WHAT DOES “STATE” MEAN IN

CONFLICT OF LAWS CONFLICT OF LAWS?

(PRIVATE It includes not only foreign sovereign countries or
states but also political subdivisions of states or
INTERNATIONAL countries which have their own legal systems (Id. at
LAW) 3).

BASIC CAUSE FOR CONFLICT OF

LAWS CASE
CONFLICT OF LAWS OR PRIVATE They come into being through variance in the
INTERNATIONAL LAW municipal laws of the countries involved. Even
Conflict of Laws is that part of the municipal law of a assuming that laws in various countries are
state which directs its courts and administrative uniformly the same, different municipal tribunals may
agencies, when confronted with a legal problem still give identical laws varying interpretations
involving a foreign element, whether or not they (PARAS, Conflict, supra at 6).
should apply a foreign law(s) (PARAS, Philippine
Conflict of Laws (1996), p. 2 [hereinafter, PARAS, THREE-FOLD FUNCTIONS OF PRIVATE
Conflict]). INTERNATIONAL LAW:
1. Question of Jurisdiction
The law concerning the rights of persons within the – prescribes the conditions under which a court
territory and dominion of one nation, by reason of or agency is competent to entertain
acts, private or public, done within the dominion of proceedings with foreign elements.
another nation (Hilton v. Guyot, 159 U.S. 113, June
3, 1895).
2. Question of Applicability of a Foreign
It is fundamentally a problem of choice of law Judgment
between foreign law and local or municipal law, by – specifies the circumstances in which foreign
the forum court, with local or municipal law as its judgment will be recognized as valid and
starting point (AGPALO, Conflict of Laws (2004), binding in the forum.
p.11 [hereinafter, AGPALO, Conflict]).
3. Question of Choice of Law
– determines the particular system of law for
CONFLICT OF LAWS CASE
each class of cases to ascertain the rights of
Any case involving facts occurring in more than one parties (PARAS, Conflict, supra at 8).
state or nation that must choose between the laws
of different states or countries in deciding the case
(SEMPIO-DIY, Handbook on Conflict of Laws
ELEMENTS OF CONFLICT OF LAWS:
(2004), p. 1 [hereinafter, SEMPIO-DIY, Conflict]). 1. Legal problem or case involving a
foreign element; and

NOTE: Foreign element – factual situation

cutting across territorial lines, affected by
diverse laws of two or more States. The

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
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for Secretariat | ARVY KEITH CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice Chairperson for
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PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
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Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
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Atty. LYAN DAVID M. JUANICO and Dean ULPIANO P. SARMINETO III

 presence of foreign element in a case
PUBLIC PRIVATE
determines the existence of a Conflict of Laws
INTERNATIONAL INTERNATIONAL
situation. Where there is no foreign element, no
LAW LAW
Conflict of Laws exists (AGPALO, Conflict,
supra at 12). As to Persons Involved
A foreign element is anything which is not
domestic and has a foreign component to it. It Sovereign states and Private individuals or
can be a foreigner, a foreign corporation, an entities possessed of corporations
incident happening in a foreign country, or a international personality,
foreign law chosen by the parties. Without a exceptionally, individuals,
foreign element, the case is only a domestic too
problem (PE BENITO, Conflict of Laws (2016),
p. 11 [hereinafter, PE BENITO, Conflict]). As to Transactions Involved

2. Determination of whether the law or Transactions entered into Strictly private in

judgments of other State/s will govern which generally affect nature
public interest;
and if so, the extent of its
transactions in which
recognition/application in the forum sovereign States are
(COQUIA & AGUILING-PANGALANGAN, interested
Conflict of Laws: Cases Materials and
Comments (2000) p. 57 [hereinafter, COQUIA, As to Remedies Applied
Conflict]).
In case of violation of Resort to municipal
REMEDIES OF CONFLICT OF LAWS International Law, resort tribunals
1. The enforcement of rights accrued in a foreign may be peaceful or
country in the form of an action filed in Philippine forcible:
courts by a citizen or aggrieved person; and
2. Recognition and enforcement of foreign Peaceful remedies:
judgment (AGPALO, Conflict, supra at 6). Diplomatic negotiation,
tender and exercise of
good offices, mediation,
PUBLIC INTERNATIONAL LAW inquiry and conciliation,
AND PRIVATE INTERNATIONAL LAW, arbitration, judicial
DISTINGUISHED settlement by the
PUBLIC PRIVATE International Court of
INTERNATIONAL INTERNATIONAL Justice
LAW LAW
Forcible remedies:
As to Source Severance of diplomatic
relations, retorsions,
International conventions, Domestic and reprisals, embargo,
international custom, the municipal laws, which boycott, non-intercourse,
general principles of law includes the pacific blockades,
recognized by civilized constitution and collective measures under
nations, and judicial statutes adopted by the U.N. Charter, and
decisions and the individual countries finally, war.
teachings of the most (PE BENITO,
highly qualified publicists Conflict, supra at 2). (PARAS, Conflict, supra at 10-11).
of the various nations
(Statute of the
International Court of SOURCES:
Justice, Art. 38(1)). 1. Direct Sources:
a. Treaties and international conventions;
As to Nature or Character b. Constitutions;
c. Codifications and statutes;
International in character National, municipal, d. Judicial decisions; and
or local in character e. International customs
(PE BENITO, 2. Indirect Sources:
Conflict, supra at 2). a. Natural moral law; and
 b. Writings and treatises of thinkers, famous
writers, and jurists on the subject, among
others (SEMPIO-DIY, Conflict, supra at 7).
A formal treaty is not the lone primary source of
customary international law. Among other things,
courts consider international custom as evidence of
a general practice accepted as law. Where there is
no treaty, and no controlling executive or legislative
act or judicial decision, resort must be had to the
customs and usages of civilized nations (Abdullahi
v. Pfizer, Inc., 562 F.3d 163, January 30, 2009).
HISTORY AND DEVELOPMENT
1. 14th century (Theory of Statutes)
– Bartolus, “Father of Conflict of Laws,”
formulated the Theory of Statutes in which
Conflicts were resolved by classifying the issues
based on real, personal, and mixed statutes.
The classifications were overlapping.
2. 16th century
– Customs were used for resolving Conflicts.
3. 17 th
century (Doctrine of Comitas
Gentium)
– relied on the theory of State sovereignty;
denied that States were under any legal
obligation to apply foreign law, unless made out
of considerations of courtesy and expediency.
4. Beginning of codifications
– Conflict of Laws provisions were included in
the civil codes of the states (SALONGA, Private
International Law (1995), pp.15-17) [hereinafter,
SALONGA, Conflict].
PHASES IN CONFLICTS RESOLUTION
1. Jurisdiction
– concerns the authority of a court of law to take
cognizance of a case (Where can or should
litigation be initiated?).
2. Choice of Law
– refers to the applicable law to the problem
(Which law will the court apply?).
3. Recognition and Enforcement
– concerns the enforcement of foreign laws and
judgments in another jurisdiction (Where can the
resulting judgment be enforced?).
These three phases are separate from each other
and a defense in one phase is not a defense in other
phases (PE BENITO, Conflict, supra at 12).
In the judicial resolution of conflicts problems, three
consecutive phases are involved: jurisdiction, choice
of law, and recognition and enforcement of
judgments. Corresponding to these phases are the
following questions:
1. Where can or should litigation be initiated;
2. Which law will the court apply; and
3. Where can the resulting judgment be enforced
(Hasegawa v. Kitamura, G.R. No. 149177,
November 23, 2007).
JURISDICTION
GENERAL RULE: It is the right of a State to exercise
authority over persons and things within its
boundaries, subject to certain exceptions
(Hongkong and Shanghai Banking Corporation v.
Sherman, G.R. No. 72494, August 11, 1989).
KINDS OF JURISDICTION IN CONFLICT
OF LAWS:
1. Judicial Jurisdiction
– power or authority of a court to try a case,
render judgment and execute it in accordance
with law.
2. Legislative Jurisdiction
– ability of the State to promulgate laws and
enforce them on all persons and property within
its territory (COQUIA, Conflict, supra at 20).
Jurisdiction and choice of law are two distinct
concepts. Jurisdiction considers whether it is fair to
cause a defendant to travel to this state. Choice of
law, on the other hand, asks the further question
whether the application of a substantive law which
will determine the merits of the case is fair to both
parties. The power to exercise jurisdiction does not
automatically give a state constitutional authority to
apply forum law. While jurisdiction and the choice of
the lex fori will often coincide, the "minimum
contacts" for one do not always provide the
necessary "significant contacts" for the other. The
question of whether the law of a state can be applied
to a transaction is different from the question of
whether the courts of that state have jurisdiction to
enter a judgment(Saudi Arabian Airlines v.
Rebesencio, G.R. No. 198587, January 14, 2015).
STEPS IN DEALING WITH A PROBLEM
IN CONFLICT OF LAWS:
1. Determine whether the court has jurisdiction
over the case. If it has no jurisdiction, the case
should be dismissed on that ground.
2. If it has jurisdiction, it may:
a. Refuse to assume jurisdiction on the ground
of forum non conveniens; or
 b. Assume jurisdiction, in which case it may
either:
i. Apply the internal law of the forum (lex
fori);
ii. Apply the proper foreign law (lex
causae) (PARAS, Conflict, supra at 25).
LONG-ARM STATUTES
Legislative act which provides for personal
jurisdiction, via substituted service or process, over
persons or corporations which are non- residents of
the state and which voluntarily go into the state,
directly or by agent or communicate with persons in
the state for limited purposes, inactions which
concern claims relating to performance or execution
of those purposes. These are statutes allowing the
courts to exercise jurisdiction when there are
minimum contacts between the non-resident
defendant and the forum. (Black’s Law Dictionary,
5th Ed. 1979).
TYPES OF JUDICIAL JURISDICTION
2. Jurisdiction over the Res
1. Jurisdiction over the person
The competence or power of a court to render a
judgment that will bind the parties to a case
(SEMPIO-DIY, Conflict, supra at 5).
How Acquired:
a. Jurisdiction over the person of the plaintiff is
acquired from the moment he invokes the
aid or power of the court by instituting an
action through proper pleading.
b. Jurisdiction over the person of the defendant
is acquired through:
i. Voluntary appearance where action is in
personam (RULES OF COURT, RULE
14, Sec. 23);
ii. Coercive process through personal or
substituted service of summons where
action is in personam (RULES OF
COURT, RULE 14, Secs. 5 and 6);
iii. Constructive Service by Publication
where the identity/whereabouts of
defendant is unknown (RULES OF
COURT, RULE 14, Sec. 16);
iv. Extra-territorial Service (RULES OF
COURT, Rule 14, Secs. 17 and 18); and
v. Service upon a foreign private juridical
entity which has transacted business in
the Philippines through its resident
agent designated in accordance with
law for that purpose, or if none, the
government official designated by law to
that effect, or any of its officers, agents,
directors or trustees within the
Philippines. If the foreign private
juridical entity is not registered in the
Philippines, or has no resident agent but
has transacted or is doing business in it,
as defined by law, such service may,
with leave of court, be effected
outside of the Philippines through
any of the following means:
1.) By personal service coursed
through the appropriate court in the
foreign country with the assistance
of the department of foreign affairs;
2.) By publication once in a newspaper
of general circulation in the country
where the defendant may be found
and by serving a copy of the
summons and the court order by
registered mail at the last known
address of the defendant;
3.) By facsimile;
4.) By electronic means with the
prescribed proof of service; or
5.) By such other means as the court,
in its discretion, may direct (RULES
OF COURT, Rule 14, Sec. 14).
Jurisdiction over the particular subject matter in
controversy, regardless of the persons who may
be interested therein (PARAS, Conflict, supra at
29, SEMPIO-DIY, Conflict, supra at 7).
Referred to as in rem jurisdiction in contrast to in
personam jurisdiction, which binds only the
parties and their successors-in-interest. A
personal action, however, may be converted to
in rem by attachment of property, among others
(SEMPIO-DIY, Conflict, supra at 7).
How Acquired:
a. Seizure of property under a legal process; or
b. Institution of legal proceedings wherein,
under special provisions of law, the power of
the court over the property is recognized
and made effective (Heirs of Morales v.
Agustin, G.R. No. 224849, June 6, 2018).
Quasi in rem jurisdiction affects only the
interests of particular persons in the thing. In
such case, the court may render valid judgment
when it has jurisdiction over the particular
persons whose interests are affected (SEMPIO-
DIY, Conflict, supra at 7).
Long-arm Statute
A law that allows a plaintiff to make a claim
against a non-resident defendant, provided
there are minimum contacts with the forum to
justify its exercise of jurisdiction over him
(COQUIA, Conflict, supra at 36).
3. Jurisdiction over the Subject Matter
It is conferred by law and is the power of the
court to hear and determine cases of the general
class to which the proceedings in question
belong (SEMPIO-DIY, Conflict, supra at 5).
In Conflict of Laws, the court must consider in
determining the matter of jurisdiction the
possible enforceability of its decision in foreign
states, subject to the rights of said states (Id. at
5)
NOTE: In the Philippines, jurisdiction over the
subject matter is conferred by law, e.g., the
Constitution and the Judiciary Reorganization
Act, as amended (B.P. 129, Judiciary Act of
1948, as amended by R.A. 9252).
Test of Jurisdiction: Whether the law vests upon
the tribunal the power to enter upon the inquiry
(Salvador v. Patricia, Inc., G.R. No. 195834,
November 9, 2016).
BASIC PRINCIPLE UNDERLYING ALL
RULES OF JURISDICTION
A State does not have jurisdiction in the absence of
some reasonable basis for exercising it, whether the
proceedings are in rem, quasi in rem, or in
personam. To be reasonable, the jurisdiction must
be based on some minimum contacts that will not
offend traditional notions of fair play and substantial
justice (SALONGA, Conflict, supra at 55).
Thus, an essential element of conflict rules is the
indication of a "test" or "connecting factor" or "point
of contact". Choice-of-law rules invariably consist of
a factual relationship (such as property right,
contract claim) and a connecting fact or point of
contact, such as the situs of the res, the place of
celebration, the place of performance, or the place
of wrongdoing (Continental Micronesia, Inc. v.
Basso, G.R. Nos. 178382-83, September 23, 2015).
MINIMUM CONTACTS TEST AND
FUNDAMENTAL FAIRNESS TEST
To bind a defendant absent from the territory of the
forum to a judgment in personam, due process
requires that he should have certain minimum
contacts with it and that the maintenance of the suit
does not offend traditional notions of fair play and
substantial justice (Shaffer v. Heitner, 433 U.S. 186,
June 24, 1977).
NOTE: For in rem and quasi-in rem, due process is
satisfied when defendant is given adequate notice
and opportunity to be heard by service of summons
through publication (COQUIA, Conflict, supra at 24).
POINTS TO REMEMBER ON
JURISDICTION
1. In choosing a particular forum, the plaintiff
accepts the forum’s entire judicial machinery, so
that he must accept not only its benefits but its
burdens as well (SEMPIO-DIY, Conflict, supra at
10);
2. The jurisdiction of the court continues even if the
defendant leaves the state of the forum prior to
the final determination of the action against him
(Id. at 10);
3. The parties to a contract may stipulate on the
foreign law to govern disputes arising from the
contract (AGPALO, Conflict, supra at 30);
4. The parties may stipulate on a Jurisdiction
Clause, a contract clause which provides that
any dispute arising from the contract shall be
tried before the competent/specific court of a
particular State;
5. A court, in assuming jurisdiction over the case,
may apply the internal law of the forum (lex fori),
or the law of some other State(s) (AGPALO,
Conflict, supra at 25); and
6. The case may be dismissed for lack of
jurisdiction of the court or its refusal to assume
jurisdiction over the case pursuant to forum non
conveniens (SEMPIO-DIY, Conflict, supra at
10).
PRINCIPLE OF FORUM NON
CONVENIENS
A court's discretionary power to decline the exercise
of its jurisdiction where another court may more
conveniently hear a case (SALONGA, Conflict,
supra at 56). Accordingly, under the doctrine of
forum non conveniens, a court, in Conflict of Laws
cases, may refuse impositions on its jurisdiction
where it is not the most 'convenient' or available
forum and the parties are not precluded from
seeking remedies elsewhere.
The use of the word "may" (i.e., "may refuse
impositions on its jurisdiction") shows that the matter
of jurisdiction rests on the sound discretion of a
court. Neither the mere invocation of forum non
conveniens nor the averment of foreign elements
operates to automatically divest a court of
jurisdiction. Rather, a court should renounce
jurisdiction only "after 'vital facts are established, to
determine whether special circumstances' require
the court's desistance." As the propriety of applying
forum non conveniens is contingent on a factual
determination, it is, therefore, a matter of defense
(Saudi Arabian Airlines (Saudia) v. Rebesencio,
G.R. No. 198587, January 14, 2015).
NOTE: It relates to forum, not to the choice of
governing law (PE BENITO, Conflict, supra at 29).
Forum non conveniens is a device akin to the rule
against forum shopping. It is designed to frustrate
illicit means for securing advantages and vexing
litigants that would otherwise be possible if the
venue of litigation (or dispute resolution) were left
entirely to the whim of either party (Saudi Arabian
Airlines v. Rebesencio, G.R. No. 198587, January
14, 2015).
The doctrine should generally apply only if the
defendant is a corporation. If the defendant is an
individual, the proper forum may not be able to
acquire jurisdiction over him (i.e., he may not be
residing there), leaving the plaintiff without any
remedy (SEMPIO-DIY, Conflict, supra at 11 and 12).
INSTANCES WHERE FORUM NON
CONVENIENS MAY BE INVOKED:
A court, though it has jurisdiction over a case, may
decline to exercise it, in view of any of the following
practical reasons:
1. Evidence and witness may not be readily
available in the forum;
2. Court dockets of the forum may already be
clogged and permitting additional cases would
hamper the speedy administration of justice;
3. Belief that the matter can be better tried and
decided in another jurisdiction, either because
the main aspects of the case transpired therein
or the material witnesses have their residence
thereat;
4. To curb the evils of forum shopping;
5. Forum has no particular interest in the case;
6. Other courts are open and the case may be
better tried therein;
7. Inadequacy of the local judicial machinery; and
8. Difficulty of ascertaining the foreign law
applicable (SEMPIO-DIY, Conflict, supra at 10-
11).
NOTE: The court will not dismiss the case under the
doctrine unless the plaintiff has another forum open
to him (AGPALO, Conflict, supra at 498).
On the other hand, courts may choose to assume
jurisdiction subject to the following requisites: "(1)
that the Philippine Court is one to which the parties
may conveniently resort to; (2) that the Philippine
Court is in a position to make an intelligent decision
as to the law and the facts; and (3) that the Philippine
Court has or is likely to have power to enforce its
decision" (Philippine National Construction Corp. v.
Asiavest Merchant Bankers (M) Berhad, G.R. No.
172301, August 19, 2015).
NOTE: Jurisdiction and choice of law are two distinct
concepts. Jurisdiction considers whether it is fair to
cause a defendant to travel to this state; choice of
law asks the further question whether the application
of a substantive law which will determine the merits
of the case is fair to both parties. The power to
exercise jurisdiction does not automatically give a
state constitutional authority to apply forum law
(Hasegawa v. Kitamura, G.R. No. 149177,
November 23, 2007).
JUSTIFICATIONS FOR THE
APPLICATION OF INTERNAL LAW OF
THE FORUM (LEX FORI) TO CONFLICT
OF LAWS CASES:
1. When the local law expressly so
provides (COQUIA, Conflict, supra at 145);
a. Law governing property transactions (CIVIL
CODE, Art. 16, par. 1);
REASON: Art. 16 of the Civil Code
mandates the application of lex situs or lex
rei sitae to all properties, whether real or
personal, found and located here.
b. Law governing the order and amount of
successional rights, intrinsic validity of
testamentary provisions, and capacity to
succeed (CIVIL CODE, Art. 16, par. 2);
c. Laws governing property relations of
marriage (FAMILY CODE, Art. 80); and
d. Laws governing revocation of wills (CIVIL
CODE, Art. 829).
2. When the foreign law or judgment has
not been properly pleaded and proved
(COQUIA, Conflict, supra at 145);
REASON: Our courts do not take judicial notice
of foreign judgments and laws. Foreign
judgments and its authenticity must be proven
as a fact under our rules on evidence, together
with the alien’s applicable national law to show
the effect of the judgment on the alien himself
(Medina v. Koike, G.R. No. 215723, July 27,
2016).
3. When the case involves any of the
exceptions to the application of the
proper foreign law (C2P2-FUL)
a. The application of foreign law runs Counter
to a sound and established public policy of
the forum (i.e., incestuous marriage or joint
will) (SEMPIO-DIY, Conflict, supra at 14);
Kinds of public policy as to extent of
operations:
i. Operates no matter where the event or
transaction takes place; and
ii. One which operates only where the
event or transaction takes place in the
forum and is not offended if the
transaction is completed abroad.
NOTE: Courts may use public policy to: (a)
refuse to entertain the case and dismiss it
 without prejudice because its enforcement is
against public policy; (b) entertain the case
and apply domestic law; or (c) entertain the
case but invoke its own public policy to apply
the forum’s domestic law.
b. The foreign law is Contrary to the almost
universally conceded principles of morality
(Contra Bonos Mores) (e.g. foreign laws
recognizing prostitution) (Id. at 14);
c. The foreign law is Penal in character
(AGPALO, Conflict, supra at 67);
Exception:
When the local law adopts the penal law of
other countries as part thereof (Id.).
A “penal clause” in a contract entered into
abroad may be enforced here because such
is not criminal but civil in nature, providing
only for liquidated damages (SEMPIO-DIY,
Conflict, supra at 15).
NOTE: Enforcement of foreign penal laws
must be distinguished from their recognition;
a state may recognize foreign penal laws for
various purposes, though it will not directly
enforce such laws in its jurisdiction (Id.at
15).
d. The foreign law involves Procedural matters
(AGPALO, Conflict, supra at 66);
REASON: If foreign procedural laws were to
be applied, it would involve a making over of
the machinery for the administration of
justice in the forum. Procedural issues are
governed by forum law so as not to unduly
burden or complicate the task of the court
with the study of uncommon peculiarities
and refinements of another legal system
(COQUIA, Conflict, supra at 88).
e. Foreign law is purely Fiscal or administrative
in nature (i.e., collection of taxes by foreign
countries or relating to governmental
functions) (SEMPIO-DIY, Conflict, supra at
15);
NOTE: A sovereign has no legal duty to
assist foreign governments in the financing
of their activities.
f. The application of foreign law involves
Undeniable injustice to the citizens or
residents of the forum or endangers the
foreign relations or vital interests of the state
(Id. at 15 and 16); and
g. The case involves real or personal property
Located in our country (CIVIL CODE, Art.
16, par. 1).
INSTANCES EXEMPTING THE
APPLICATION OF INTERNAL LAW TO
CONFLICT OF LAWS CASES
1. A foreign sovereign, diplomatic official, or public
vessel or property of another state is involved
(SALONGA, Conflict, supra at 63);
2. The State accepted a limitation upon its
jurisdiction over certain persons or things of
another State through a treaty (Id.); or
3. Foreign law has been pleaded and proved
(RULES OF COURT, RULE 132, Sec. 25).
MANNER OF PROVING FOREIGN LAWS
GENERAL RULE: In this jurisdiction, courts are not
authorized to "take judicial notice of foreign laws."
The laws of a foreign country must "be properly
pleaded and proved" as facts, in accordance with the
Rules on Evidence. Otherwise, under the doctrine of
processual presumption, foreign law shall be
presumed to be the same as domestic law (Chiquita
Brands, Inc. v. Omelio, G.R. No. 189102, June 7,
2017).
1. Written Law
a. By official publication (SEMPIO-DIY,
Conflict, supra at 13);
b. Copy attested by officer having legal
custody thereof. If the record is not kept in
the Philippines, a certificate with seal from a
secretary of the embassy, legation, consul
general, consul, vice consul, consular
agent, or any officer in the foreign service of
the Philippines stationed in the foreign
country to the effect that said officer has
custody is required (RULES OF COURT,
RULE 132, Sec. 24); and
c. A published treatise on the subject law
provided that the court takes judicial notice
of the competence of the writer, or evidence
is introduced to establish the author’s
competence (RULES OF COURT, RULE
130, Sec. 48).
There can be no summary judgment where
questions of fact are in issue or where material
allegations of the pleadings are in dispute. The
resolution of whether a foreign law allows only
the recovery of actual damages is a question of
fact as far as the trial court is concerned since
foreign laws do not prove themselves in our
courts. Foreign laws are not a matter of judicial
notice. Like any other fact, they must be alleged
and proven (Manufacturers Hanover Trust Co. v.
Guerrero, G.R. No. 136804, February 19, 2003).
2. Unwritten Law
a. By oral testimony of expert witnesses
(SEMPIO-DIY, Conflict, supra at 13); or
NOTE: The existence of a foreign law may
be established through a testimony under
oath of an expert witness such as an
attorney-at-law in the country where the
foreign law operates wherein he quotes
verbatim a section of the law and states that
the same was in force at the time material to
the facts at hand (Sobejana-Condon v.
Commission on Elections, G.R. No. 198742,
August 10, 2012).
Sec. 25, Rule 132 of the Rules of Court does
not exclude the presentation of other
competent evidence to prove the existence
of a foreign law (Asiavest Limited v. CA,
G.R. No. 128803, September 25, 1998).
b. By printed and published books of reports of
decisions of the country involved, if proved
to be commonly admitted in its courts
(RULES OF COURT, RULE 130, Sec. 47).
EXCEPTIONS TO THE PROCEDURAL
REQUIREMENTS FOR PROVING
FOREIGN LAW:
1. Presentation of a foreign-licensed attorney who
will testify in open court concerning her
knowledge of the law in question (Mercantile
Insurance Co., Inc. v. Yi, G.R. No. 234501,
March 18, 2019);
2. Administrative agencies recognizing foreign
laws without proof thereof;
3. Lack of objection to the improper presentation
by one party of proof of foreign law; and
4. Laws appearing in official websites of
government agencies which have custody of
laws (PE BENITO, Conflict, supra at 80).
In International Law, jurisdiction is often defined as
the right of a State to exercise authority over persons
and things within its boundaries subject to certain
exceptions. Thus, a State does not assume
jurisdiction over traveling sovereigns, ambassadors
and diplomatic representatives of other States, and
foreign military units stationed in or marching
through State territory with the permission of the
latter's authorities. This authority, which finds its
source in the concept of sovereignty, is exclusive
within and throughout the domain of the State. A
State is competent to take hold of any judicial matter
it sees fit by making its courts and agencies assume
jurisdiction over all kinds of cases brought before
them (Hongkong and Shanghai Banking Corp. v.
Sherman, G.R. No. 72494, August 11, 1989).
EFFECT OF FAILURE TO PLEAD OR
PROVE FOREIGN LAW:
1. Defendant may move for Demurrer to Evidence
if plaintiff’s cause of action rests on unproven
foreign law, resulting in no cause of action to the
plaintiff’s case. If the defense rests on unproven
foreign law, the defense fails (AQUINO,
Elements of Private International Law (2006) p.
101 [hereinafter, AQUINO, Elements of Private
International Law]).
2. The case will not be dismissed; the doctrine of
processual presumption will become operative
(Chiquita Brands, Inc. v. Omelio, G.R. No.
189102, June 7, 2017).
DOCTRINE OF PROCESSUAL
PRESUMPTION OR PRESUMED-
IDENTITY APPROACH
In the absence of pleading and proof, the laws of the
foreign country or state will be presumed to be the
same as our local or domestic law. This is known as
processual presumption (Nedlloyd Lijnen B.V.
Rotterdam v. Glow Laks Enterprise, Ltd., G.R. No.
156330, November 19, 2014).
CHOICE OF LAW
QUESTIONS THAT CHOICE-OF-
APPLICABLE-LAW SEEKS TO
ANSWER:
1. What legal system should control a given
situation where some of the significant facts
occurred in two or more states; and
2. To what extent should the chosen system
regulate the situation (COQUIA, Conflict, supra
at 57).
NOTE: Foreign law has no extraterritorial effect and
any exception to this right must be traced to the
consent of the nation (AGPALO, Conflict, supra at
16).
It is appropriate to assume that Congress had
domestic concerns in mind. This assumption is
similar to the legal presumption that Congress
ordinarily intends its statutes to have domestic, not
extraterritorial application. The Court assumes a
congressional intent that the phrase “convicted in
any court” applies domestically, not extraterritorially,
unless the statutory language, context, history, or
purpose shows the contrary (Small v. United States,
544 U.S. 385, April 26, 2005).
THEORIES IN JUSTIFYING THE
APPLICATION OF FOREIGN LAW IN
CONFLICTS CASES: (CVL-JH)
1. Theory of Comity
The application of foreign legal systems in cases
involving foreign element is proper, otherwise,
the non-application would constitute a disregard
of foreign sovereignty or lack of comity towards
other States (PARAS, Conflict, supra at 65).
Comity
It is the recognition which one nation allows
within its territory, to the legislative, executive, or
judicial acts of another nation, having due regard
to both international duty and convenience and
to the rights of its own citizens, of other persons
who are under the protection of its laws (Sison
v. the Board of Accountancy, G.R. No. L-
2529, December 31, 1949, citing Hilton v.
Guyot).
Two Principles upon which Theory of Comity
Rests:
a. Comity based on reciprocity; and
NOTE: If the laws and judgments of the
forum are recognized in a foreign state, the
forum in turn will recognize the laws and
judgments emanating from said foreign
state (Hilton v. Guyot, 159 U.S. 113, June 3,
1895).
b. Comity based on the persuasiveness of a
foreign judgment.
NOTE: If the forum is persuaded that a
foreign judgment is meritorious and has
been rendered by a court of competent
jurisdiction, it will not hesitate to enforce that
foreign judgment in the forum even if the
foreign forum does not reciprocate
(Johnston v. Compagnie Generale
Transatlantique, 243 N.Y. 541, July 11,
1924).
A foreign final judgment or final order “is
presumptive evidence of a right as between
the parties and their successors in interest
by subsequent title” and “may be repelled by
evidence of a want of jurisdiction, want of
notice to the party, collusion, fraud, or clear
mistake of law or fact” (RULES OF COURT,
Rule 39, Sec. 48).
2. Vested Rights Theory
Courts enforce not the foreign law or foreign
judgment but the right/s vested under such law
or judgment. Thus, rights acquired in one
country must be recognized and legally
protected in other countries. The forum will not
apply the foreign law but will simply recognize
the right vested by said law (SALONGA,
Conflict, supra at 72).
3. Local Law Theory
This involves the appropriation of a foreign rule
by the State of the forum and transforming it into
a domestic rule. A foreign law is applied because
our own law, by applying a similar rule, requires
us to do so, as if the foreign law has become part
of our own internal or domestic law (SEMPIO-
DIY, Conflict, supra at 20).
Illustration: Art. 16, par. 2 of the Civil Code
requires the application of the national law of the
deceased in the matter of his testate or intestate
succession (Id. at 20).
4. Theory of Justice (Caver’s Principles of
Preference)
The thesis of Prof. David F. Cavers’ article
entitled “A Critique of the Conflict of Laws
Problem” was that choice of law should be
determined by “considerations of justice and
social expediency” and should not be the result
of mechanical application of the rule or principle
of selection (COQUIA, Conflict, supra at 66).
Foreign law should not be applied when its
application would work undeniable injustice to
the citizens or residents of the forum. A law or
judgment or contract that is obviously unjust
negates the fundamental principles of Conflict of
Laws (Continental Micronesia, Inc. v. Basso,
G.R. Nos. 178382-83, September 23, 2015).
5. Harmony of Laws Theory
Identical or similar problems should be given
identical or similar solutions, thus resulting in
harmony of laws. The application of the same or
similar solution prevents the bad practice of
forum shopping (SEMPIO-DIY, Conflict, supra at
20).
NOTE: The foregoing theories do not mutually
exclude another; perhaps, the truth may be
found in their combination (PARAS, Conflict,
supra at 73).
 countries following the domiciliary theory (SEMPIO-
NATURE, DIY, Conflict, supra at 38).

COMPOSITION & PARTS OF CONFLICT RULES

CHARACTERIZATION 1. Object or the Factual Situation
– the set of facts or situation presenting a
OF CONFLICTS RULES Conflicts problem because there is a foreign
element involved (Id. at 24).

CONFLICT RULES 2. Legal Consequences or the Point of

Contact or Connecting Factor
A provision found in our own law which governs a
– the law of the country with which the factual
factual situation possessed of a foreign element. It is
situation is most intimately connected (Id. at 24).
usually expressed in the form of an abstract
proposition that a given legal question is governed
by the law of a particular country (which may be an
CHARACTERIZATION OR DOCTRINE OF
internal law or the proper foreign law), to be QUALIFICATION OR CLASSIFICATION
ascertained in the manner indicated in the provision Before a choice of applicable law can be made, it is
(SEMPIO-DIY, Conflict, supra at 22). necessary to determine under what category a
certain set of facts or rules fall. This determination
ORDINARY INTERNAL RULES AND process is known as "characterization", or the
"doctrine of qualification". It is the "process of
CONFLICT RULES, DISTINGUISHED deciding whether or not the facts relate to the kind of
ORDINARY CONFLICT RULES question specified in a conflicts rule." The purpose
INTERNAL RULES of "characterization" is to enable the forum to select
the proper law (Saudi Arabian Airlines v. Court of
Authorize, command, or Decides on which law Appeals, G.R. No. 122191, October 8, 1998).
prohibit certain mode of or jurisdiction will give
conduct (e.g., Art. 796 of the final solution to the The law chosen should be applied only insofar as it
the Civil Code). Its legal question (e.g., Art. 16, brings about the good it intended to bring. The
effects are immediately par. 1 and Art. 17, par. selected proper law is applied to the factual situation
indicated (e.g., Express 2 of the Civil Code). to decide: (1) legal consequences resulting from the
prohibition). situation; or (2) interests created in the thing in
(Id. at 22) question.

TWO KINDS OF CONFLICT RULES STEPS IN CHARACTERIZATION:

1. One-sided rule
– indicates when Philippine law will apply, e.g.,
Art. 15 and Art. 818 of the Civil Code only apply
to Filipinos (SEMPIO-DIY, Conflict, supra at 23).
2. All-sided or multilateral rule
– indicates whether to apply the local law or the
proper foreign law, e.g., First paragraphs of Art.
16 and Art. 17, Art. 1763 and Art. 1039 of the
Civil Code (Id. at 23).
NOTE: Justice Sempio-Diy observes that while Art.
15 of the Civil Code applies only to Filipinos and is
actually a one-sided rule, the Supreme Court has
given it a multi-lateral application when it held that
foreigners, in their status and legal capacities, are
governed by their national laws (Gibbs v. The
Government of the Philippine Islands., G.R. No. L-
35694, December 23, 1933).
The nationality theory has been applied by the
Supreme Court even to persons who are citizens of
(FSR-PProPleA)
1. The determination of the Facts involved;
2. The characterization of the factual Situation;
3. The determination of the conflicts Rule which is
to be applied;
4. The characterization of the Point of contact
where the connecting factor;
5. The characterization of the Problem as
procedural or substantive;
6. The Pleading and proving of the proper foreign
law; and
7. The Application of the proper foreign law to the
problem (PARAS, Conflict, supra at 88).
NOTE: Only steps 2-5 concern themselves with
characterization proper (PARAS, Conflict, supra at
88).
NOTE: As to the first step, the starting point of
analysis is not a legal relation, but a factual situation,
event, or operative fact. An essential element of
conflict rules is the indication of a "test" or
"connecting factor" or "point of contact." One or more
circumstances may be present to serve as the
possible test for the determination of the applicable
law.
These "test factors" or "points of contact" or
"connecting factors" could be any of the following:
1. The nationality of a person, his domicile, his
residence, his place of sojourn, or his origin;
2. The seat of a legal or juridical person, such as a
corporation;
3. The situs of a thing, that is, the place where a
thing is, or is deemed to be situated. In
particular, the lex situs is decisive when real
rights are involved;
4. The place where an act has been done, the
locus actus, such as the place where a contract
has been made, a marriage celebrated, a will
signed or a tort committed. The lex loci actus is
particularly important in contracts and torts;
5. The place where an act is intended to come into
effect, e.g., the place of performance of
contractual duties, or the place where a power
of attorney is to be exercised;
6. The intention of the contracting parties as to the
law that should govern their agreement, the lex
loci intentionis;
7. The place where judicial or administrative
proceedings are instituted or done. The lex fori
— the law of the forum — is particularly
important because matters of 'procedure' not
going to the substance of the claim involved are
governed by it; and because the lex fori applies
whenever the content of the otherwise
applicable foreign law is excluded from
application in a given case for the reason that it
falls under one of the exceptions to the
applications of foreign law; and
8. The flag of a ship, which in many cases is
decisive of practically all legal relationships of
the ship and of its master or owner as such. It
also covers contractual relationships particularly
contracts of affreightment (Saudi Arabian
Airlines v. Court of Appeals, supra).
SINGLE-ASPECT METHOD
In order to connect the case to a particular legal
community, choice-of-law theories have
concentrated on one element of a situation to foster
simplicity, convenience, and uniformity of results
(COQUIA, Conflict, supra at 82).
TWO TYPES OF CHARACTERIZATION
UNDER THE SINGLE-ASPECT METHOD
1. Subject-matter Characterization
Calls for classification by a court of a factual
situation into a legal category. It is relevant in a
single-aspect method because the legal
category to which an issue is assigned
determines the governing law (Id. at 84).
2. Substance-Procedure Characterization
Directs the court to the extent it will apply foreign
law. If the issue is substantive, the court may
apply foreign law but if it is procedural, it is
supposed to follow the law of the forum (Id. at
88).
RULES ON CHARACTERIZATION OF
PROCEDURAL AND SUBSTANTIVE
RULES
GENERAL RULE: If an issue is substantive, apply
foreign law. If it is procedural, apply the forum law or
lex fori.
DETERMINANTS OF AN ISSUE AS
PROCEDURAL OR SUBSTANTIVE
1. Questions of Evidence
– procedural
2. Statute of Frauds
a. Substantive if the law forbids the obligation.
i.e., void contracts.
b. Procedural if the law forbids the
enforcement of the obligation. i.e.,
unenforceable contracts, Art. 1403 of Civil
Code (Id. supra at 92).
3. Borrowing Statutes and Statute of
Limitations
Borrowing Statutes
Directs the state of the forum to apply the foreign
statute of limitations to the pending claims based
on a foreign law (LWV Construction Corp. v.
Dupo, G.R. No. 172342, July 13, 2009).
Statute of Limitations
Specificity Test – Limitation is substantive
when it is directed at the newly created liability,
warranting a qualification of the right (Bournias
v. Atlantic Maritime Co., Ltd., 220 F. 2d 152,
February 10, 1955).
Limitation is procedural if it operates to bar only
the legal remedy, without impairing the
substantive right involved.
The characterization of a statute of limitation into
procedural or substantive becomes irrelevant
when the country of the forum has a borrowing
statute, which has the practical effect of treating
the foreign statute of limitation as one of
substantive law (GOODRICH, Conflict of Laws
(1938), p. 152-153).
NOTE: A law on prescription is sui generis in
Conflict of Laws as it may be viewed as
procedural or substantive, depending on the
characterization given (Cadalin v. Administrator,
 Philippine Overseas Employment
Administration, G.R. No. 104776, December 5,
1994).
The modern trend is to consider the prescriptive
periods or the Statute of Frauds that the parties
had in mind at the time the transaction took
place (SEMPIO-DIY, Conflict, supra at 27).
DÉPEÇAGE
From the French "deceper” meaning “to dissect”.
The different aspects of the case involving a foreign
element may be governed by different systems of
law (LIPSTEIN, General Principles of Private
International Law, (1972), p. 214, 135 Recuile des
Cours).
Process whereby different issues in a single case
arising out of a single set of facts may be decided
according to the laws of different states, the
procedural matters being governed by forum law and
substantive matters by some other law (Buchanan v.
Doe, 246 Va. 67, June 11, 1993).
PROPOSED SOLUTIONS TO THE
PROBLEM OF CHARACTERIZATION:
1. The Lex Fori Solution
GENERAL RULE: The facts and issues are
characterized based on forum’s own law.
Thereafter, the foreign or domestic law is
applied to the lex fori-based characterization.
REASON: Lex fori determines characterization
because of practical necessity.
EXCEPTION: When lex fori characterization will
result in clear injustice, lex fori characterization
will not apply (SEMPIO-DIY, Conflict, supra at
27).
2. The Lex Causae Solution
The characterization will depend on the
governing law.
3. The Analytic Jurisprudence and
Comparative Law Solution
The court determines the common patrimony of
juridical concepts and employs universal or
quasi-universal characterization.
4. The Double Characterization Solution
It couples the lex fori and lex causae solution.
5. Substance v. Procedure Principle
Matters of Procedure – governed by the law of
the forum where the case is filed.
Matters of Substance – governed by the law of
the country where the action arose (AGPALO,
Conflict, supra at 37).
As a general rule, a foreign procedural law will
not be applied in the forum. Procedural matters,
such as service of process, joinder of actions,
period and requisites for appeal, and so forth,
are governed by the laws of the forum. This is
true even if the action is based upon a foreign
substantive law (Cadalin v. Administrator,
Philippine Overseas Employment
Administration, G.R. No. 104776, December 5,
1994).
The characterization of a statute into a
procedural or substantive law becomes
irrelevant when the country of the forum has a
"borrowing statute." Said statute has the
practical effect of treating the foreign statute of
limitation as one of substance (Cadalin v.
Administrator, Philippine Overseas Employment
Administration, G.R. No. 104776, December 5,
1994).
6. Center of Gravity Doctrine (Grouping of
Contracts Principle or State of the Most
Significant Relationship Theory)
Application of the law of the jurisdiction which
has the most significant relationship to or
contact with the event, parties, and issues (Id. at
37).
7. The Autonomous Theory
Forum considers the characterization of the
country referred to in lex causae (PARAS,
Conflict, supra at 99).
8. Totality Theory
Determines the intended law of the parties and
applies the characterization given by the
intended law (Id.).
PERSONAL LAW
The law which attaches to a person wherever he
may go and generally governs his status, capacity,
condition, family relations, and the consequences of
his actuations (SEMPIO-DIY, Conflict, supra at 36).
It allows courts to exercise jurisdiction or determine
the governing choice-of-law rule on a specific
situation or transaction involving a person wherever
he may be (COQUIA, Conflict, supra at 88).
DIFFERENT THEORIES OF PERSONAL
LAW
1. The Nationality Theory or Personal
Theory
– the status and capacity of a person is
determined by the law of his nationality or
national law (SEMPIO-DIY, Conflict, supra at
30).
NOTE: The Philippines follows the Nationality
Theory (Id. at 30-31).
2. The Domiciliary Theory or Territorial
Theory
– the status and capacity of a person is
determined by the law of his domicile (Id.).
NOTE: The United States, like other common
law countries, follows the domiciliary theory (Id.
at 30-31).
3. The Situs or Eclectic Theory
– the particular place or situs of an event or
transaction is generally the controlling law (Id. at
30).
JUSTIFICATION OF PERSONAL LAW
Prof. R.H Graveson, a Professor Emeritus in the
University of London, writes that: “The idea of the
personal law is based on the conception of man as
a social being, so that those transactions of his daily
life, which affect him most closely in a personal
sense, such as marriage, divorce, legitimacy, many
kinds of capacity, and succession maybe governed
universally by that system of law most suitable in
adequate for the purpose.” (1974)
NATIONALITY OR PERSONAL THEORY
OR LEX NATIONALII
It is the theory by virtue of which the status and
capacity of an individual are generally governed by
the laws of his nationality (PARAS, Conflict, supra at
104).
The personal law of an individual is his national law.
This theory is adopted mostly by civil law countries
like the Philippines where the identity and legal
position of their citizens are guaranteed by a
consistent application by their national laws on
status and family relations wherever they may go
(SEMPIO-DIY, Conflict, supra at 31).
Laws relating to family rights and duties, or to the
status, condition, and legal capacity of persons are
binding upon citizens of the Philippines even though
living abroad (CIVIL CODE, Art. 15).
NATIONALITY
It refers to the membership in a political community,
one that is personal and more or less permanent. In
Conflict of Laws, nationality and citizenship are used
interchangeably (SEMPIO-DIY, Conflict, supra at
31).
STATUS
Refers to the place of an individual in society and
consists of more or less permanent personal
qualities and relationships with which the state and
community are concerned (Id. at 29).
CAPACITY
It is a part of one’s status and is the sum total of
one’s rights and obligations (Id. at 30).
ACQUISITION OF NATIONALITY
1. Birth
– Natural-born citizens are citizens of the
Philippines from birth without having to perform
any act to acquire or perfect citizenship (Id. at
34).
a. Jus Soli – citizenship is acquired by being
born within the territorial boundaries of a
state (PE BENITO, Conflict, supra at 138).
b. Jus Sanguinis – citizenship is acquired
through blood relationship with the parent
(Id.).
Foundlings, or those abandoned children with
no known natural parents, are natural-born
citizens because they are not an excluded class
under the Constitution. So long as there is a high
probability that the foundling’s parents are
Filipinos, that person will be considered natural-
born (Poe-Llamanzares v. COMELEC, G.R.
Nos. 221697-221700, March 8, 2016).
REASON: To deny full Filipino citizenship to all
foundlings and render them stateless just
because there may be a theoretical chance that
one among the thousands of these foundlings
might be the child of not just one, but two,
foreigners is downright discriminatory, irrational,
and unjust (Id).
2. Naturalization
It is the process of confirming on an alien the
citizenship of another country, by any of the
means provided by law (SEMPIO-DIY, Conflict,
supra at 44).
Naturalization is a mode for both acquisition and
reacquisition of Philippine citizenship. As a
mode of initially acquiring Philippine citizenship,
naturalization is governed by Commonwealth
Act No. 473, as amended. Naturalization as a
mode for reacquiring Philippine citizenship is
governed by Commonwealth Act No. 63
(Bengson III v. House of Representatives
Electoral Tribunal, G.R. No. 142840, May 7,
2001).
Modes of Naturalization
a. Direct Naturalization
i. Judicial Process – Commonwealth Act
No. 475 as amended by RA 530 (Id. at
45).
ii. Legislative Process – Philippine
Citizenship conferred by Congress (Id.
at 45).
iii. Administrative Process – “The
Administrative Naturalization Law of
2000” or RA 9139. A special committee
is created to approve, deny, or reject
applications for naturalization filed with
said committee (Id. at 45).
b. Derivative Naturalization
i. Wife of a naturalized husband;
ii. Minor children of naturalized father; or
iii. Alien wife of a natural-born or
naturalized citizen (Id. at 45).
If a woman is repatriated, her repatriation
does not carry with it the repatriation of the
child as the minor was never a Filipino
previously. Commonwealth Act No. 63 does
not provide that upon repatriation of a
Filipina, her children acquire Philippine
citizenship. It would be illogical to consider
his son repatriated like his mother, because
he never was a Filipino citizen and could not
have reacquired such citizenship
(Villahermosa v. Commissioner of
Immigration, G.R. No. L-1663, March 31,
1948).
If instead of repatriation, the widow had
automatically regained Philippine
citizenship, the nationality of her minor child
would follow hers (Talaroc v. Uy, G.R. No.
L-5397, September 26, 1952).
Effect of Naturalization on Wife and
Children
a. Minor born before naturalization
i. Born in the Philippines – Filipino
ii. Born outside the Philippines
1.) Residing in the Philippines at the
time of parent’s naturalization –
Filipino
2.) Residing outside the Philippines at
the time of parent’s naturalization –
Filipino only during his minority
unless he resides permanently in
the Philippines when still a minor, in
which case he will continue to be a
Filipino citizen even after becoming
of age (Commonwealth Act No.
473, Section 15).
b. Minor born after naturalization
i. Born in the Philippines – Filipino
ii. Born outside the Philippines – shall be
considered a Filipino citizen, unless
within one year after reaching the age of
majority, he fails to register himself as a
Filipino citizen in the Philippine
consulate of the country where he
resides and to take the necessary oath
of allegiance (Commonwealth Act No.
473, Section 15).
In case of children already of age at the time of
parent’s naturalization – not a Filipino unless
they themselves be naturalized (PARAS,
Conflict, supra at 128-129).
The 1987 Constitution provides that citizens of
the Philippines who marry aliens shall retain
their citizenship unless by their act or omission
they are deemed, under the law, to have
renounced it.
If she became a widow before the effectivity of
Commonwealth Act 63, which is on October 21,
1963, she immediately reacquires Philippine
citizenship (Talaroc v. Uy, G.R. No. L-5397,
September 26, 1952).
If she became a widow on or after October 21,
1963, she has to repatriate herself, otherwise
she remains a foreigner (Villahermosa v.
Commissioner of Immigration, G.R. No. L-1663,
March 31, 1948).
PROBLEMS IN APPLYING THE
NATIONALITY PRINCIPLE IN DUAL OR
MULTIPLE CITIZENSHIP
It arises from the concurrent application of jus soli
and jus sanguinis at birth or from a refusal of certain
States to accept a full application of the doctrine of
expatriation, from marriage, or from a formal and
voluntary act.
1. In matters of status, a person is usually
considered by the forum as exclusively its own
national. His additional foreign nationality is
disregarded.
2. In case litigation arises in a third country, the law
most consistently applied is that of the country
of which the person is not only a national but
where he also has his domicile or habitual
residence, or in the absence thereof, his
residence (Hague Convention on Conflict of
Nationality Laws, Art. 5).
DUAL CITIZENSHIP DISTINGUISHED
FROM DUAL ALLEGIANCE
Dual citizenship is different from dual allegiance. The
former arises when, as a result of the concurrent
application of the different laws of two or more
states, a person is simultaneously considered a
national by the said states. Dual allegiance refers to
the situation in which a person simultaneously owes,
by some positive act, loyalty to two or more states.
While dual citizenship is involuntary, dual allegiance
is the result of an individual's volition (Mercado v.
Manzano, G.R. No. 135083, May 26, 1999).
GENERAL PRINCIPLES IN DEALING
WITH CONFLICT OF NATIONALITY
LAWS
1. It is for each State to determine who are its
nationals under its own law, which shall be
recognized by other States;
2. Any question as to the possession of nationality
shall be determined in accordance with the law
of that State;
3. A person having two or more nationalities may
be regarded as a national by each of the States
whose nationality he possesses;
4. A State may not afford diplomatic protection to
one of its nationals against a State whose
nationality such person also possesses;
5. Theory of Effective Nationality - A third state
shall recognize exclusively in its territory either
the nationality of the country of which one is
habitually and principally a resident, or the
nationality of the country with which in the
circumstances one appears to be in fact most
closely connected; and
6. A person possessing two nationalities acquired
without any voluntary act on his part may
renounce one of them without the authorization
of the State whose nationality he desires to
surrender (Hague Convention on Certain
Questions Relating to the Conflict of Nationality
Laws).
CAUSES OF MULTIPLE CITIZENSHIP
(FALV)
1. A naturalized citizen’s Failure to effectively
renounce his former nationality;
2. Application of Jus Soli and Jus Sanguinis
principles;
3. The Legislative act of States; or
4. The Voluntary act of the individual concerned
(COQUIA, Conflict, supra at 195-196).
TWO SENSES OF STATELESSNESS
1. De Jure Statelessness
– A person has been stripped of his nationality
by his former government without having an
opportunity to acquire another;
2. De Facto Statelessness
– A person possessed of a nationality but whose
country does not give him protection outside its
own territory (refugees) (Id. at 200-201).
CAUSES OF STATELESSNESS (DRVB)
1. Deprivation of citizenship for any cause, e.g.,
commission of a crime;
2. Renunciation of nationality by express or implied
acts;
3. Voluntary release from original state; and
4. If Born in a country recognizing only the principle
of jus sanguinis of parents whose law
recognizes only the principle of jus soli (PARAS,
Conflict, supra at 110).
NOTE: The Convention on the Reduction of
Statelessness, adopted in 1961, mandates that
the jus sanguinis country grant its nationality to
a person born within its territory if he would
otherwise be stateless, and the jus soli country
to extend its nationality to a person who would
otherwise be considered stateless when one of
his parents is a citizen of the contracting state.
Stateless persons are generally subject to the
law of their domicile or habitual residence, and
in default thereof, to the law of their temporary
residence (Hague Conference of 1928 on
International Private Law).
CITIZENSHIP
RETENTION
AND RE-ACQUISITION
ACT OF 2003
(R.A. NO. 9225)
R.A. 9225 was enacted to allow the re-acquisition
and retention of Philippine citizenship by:
1. Natural-born citizens who were deemed to have
lost their Philippine citizenship by reason of their
naturalization as citizens of a foreign country;
and
2. Natural-born citizens of the Philippines who,
after the effectivity of the law, became citizens of
a foreign country.
The law provides that they are deemed to have re-
acquired or retained their Philippine citizenship upon
taking the oath of allegiance (Maquiling v.
Commission on Elections, G.R. No. 195649, April
16, 2013).
SEC. 2 DECLARATION OF POLICY
All Philippine citizens of another country shall be
deemed not to have lost their Philippine citizenship
under the conditions of this Act.
SEC. 3 RETENTION OF PHILIPPINE
CITIZENSHIP
Any provision of law to the contrary notwithstanding,
natural-born citizenship by reason of their
naturalization as citizens of a foreign country are
hereby deemed to have re-acquired Philippine
citizenship upon taking the oath of allegiance to the
Republic.
Natural-born citizens of the Philippines who, after the
effectivity of this Act, become citizens of a foreign
country shall retain their Philippine citizenship upon
taking the aforesaid oath.
Re-acquisition Distinguished from Retention
Although the heading of Section 3 is "Retention of
Philippine Citizenship," the authors of the law
intentionally employed the terms "re-acquire" and
"retain" to describe the legal effect of taking the oath
of allegiance to the Republic of the Philippines. This
is also evident from the title of the law using both re-
acquisition and retention. The reacquisition will apply
to those who lost their Philippine citizenship by virtue
of Commonwealth Act 63. The second aspect is the
retention of Philippine citizenship applying to future
instances (David v. Agbay, G.R. No. 199113, March
18, 2015).
SEC. 4 DERIVATIVE CITIZENSHIP
The unmarried child, whether legitimate, illegitimate,
or adopted, below eighteen (18) years of age, of
those who reacquire Philippine citizenship upon
effectivity of this Act shall be deemed citizens of the
Philippines.
SEC. 5 CIVIL AND POLITICAL RIGHTS
AND LIABILITIES
Those who retain or re-acquire Philippine citizenship
under this Act shall enjoy full civil and political rights
and be subject to all attendant liabilities and
responsibilities under existing laws of the Philippines
and the following conditions:
1. Those intending to exercise their right of
suffrage must meet the requirements under Sec.
1, Article V of the Constitution, Republic Act
9189, otherwise known as "The Overseas
Absentee Voting Act of 2003" and other existing
laws;
2. Those seeking elective public office in the
Philippines shall meet the qualifications for
holding such public office as required by the
Constitution and existing laws and, at the time of
the filing of the certificate of candidacy, make a
personal and sworn renunciation of any and all
foreign citizenship before any public officer
authorized to administer an oath;
In Sobejana-Condon v. COMELEC, et al. (G.R.
No. 198742, August 10, 2012), the Supreme
Court ruled that Section 5(2) of Republic Act No.
9225 compels natural-born Filipinos, who have
been naturalized as citizens of a foreign country,
but who reacquired or retained their Philippine
citizenship (1) to take the oath of allegiance
under Section 3 of Republic Act 9225, and (2)
for those seeking elective public offices in the
Philippines, to additionally execute a personal
and sworn renunciation of any and all foreign
citizenship before an authorized public officer
prior or simultaneous to the filing of their
certificates of candidacy, to qualify as
candidates in Philippine elections. The rule
applies to all those who have re-acquired their
Filipino citizenship, without regard as to whether
they are still dual citizens or not. It is a pre-
requisite imposed for the exercise of the right to
run for public office.
Note however, in Maquiling v. COMELEC (G.R.
No. 195649, April 16, 2013), petitioner was
repatriated under R.A. 9225 and made his oath
of allegiance and renunciation of US citizenship.
Thereafter, he repeatedly used his US Passport.
The Supreme Court ruled that the repeated use
of the US passport is a positive declaration that
he is a US citizen, reverting him back to the
status as if no oath of renunciation was made,
thus rendering him disqualified to run for public
office.
3. Those appointed to any public office shall
subscribe and swear to an oath of allegiance to
the Republic of the Philippines and its duly
constituted authorities prior to their assumption
of office, provided, that they renounce their oath
of allegiance to the country where they took that
oath;
4. Those intending to practice their profession in
the Philippines shall apply with the proper
authority for a license or permit to engage in
such practice; and
5. That right to vote or be elected or appointed to
any public office in the Philippines cannot be
exercised by, or extended to, those who:
a. Are candidates for or are occupying any
public office in the country of which they are
naturalized citizens; and/or
 b. Are in active service as commissioned or
non-commissioned officers in the armed
forces of the country which they are
naturalized citizens.
R.A. No. 9225 provides for a deeper effect by
declaring it a State policy that under its terms "all
Philippine citizens of another country shall be
deemed not to have lost their Philippine citizenship"
under the conditions provided therein (Arnado v.
Commission on Elections, G.R. No. 210164, August
18, 2015).
DOMICILIARY OR TERRITORIAL
THEORY/LEX DOMICILII
The person’s status, condition, rights, obligations
and capacity are determined by the law of his
domicile (SEMPIO-DIY, Conflict, supra at 51).
It assumes that the attributes which make up one’s
status and personal relations are intimately
connected with the country where they have made
their home (Id. at 31 and 32).
DOMICILE
conduct indicative of such intention (Romualdez-
Marcos v. Commission on Elections, G.R. No.
119976, September 18, 1995).
LEGAL CLASSIFICATION OF DOMICILE
1. Domicile of Origin or Birth
– the domicile assigned by law to a person at
the moment of his birth (SEMPIO-DIY, Conflict,
supra at 53);
a. Minors
i. Legitimate – that of his parents at the
same time of child’s birth; if the parents
are separated, the domicile of the
custodial parent.
ii. Illegitimate – that of the mother at the
time of child’s birth.
iii. Legitimated – domicile of the father at
the time of his birth controls, as the
effects of legitimation retroacts to the
time of the child's birth (FAMILY CODE,
Art. 180).
iv. Adopted Child – domicile of real parents
at the time of his birth, not the domicile
of the adopters (SEMPIO-DIY, Conflict,
supra at 54).
v. Foundling – domicile is the country
where foundling was found.

b. Married Women
DOMICILE The husband and wife shall fix the family
domicile. In case of disagreement, the court
It is the place wherein a person has a settled shall decide (FAMILY CODE, Art. 69).
connection for certain legal purposes, either
because his home is there or it is the place assigned
2. Constructive Domicile or Domicile by
to him by law (Id. at 51).
Operation of Law
– the domicile assigned by law to persons after
DOMICILE V. RESIDENCE V. birth on account of legal disability (i.e., minors,
CITIZENSHIP mentally disabled) (SEMPIO-DIY, Conflict,
DOMICILE RESIDENCE CITIZENSHIP supra at 53);

Fixed, Place of Indicates ties a. Minors

permanent abode, of allegiance i. Legitimate – the domicile of both
residence to whether and loyalty parents. In case of disagreement, that of
which, when permanent or the father, unless there is a judicial order
absent, one has temporary to the contrary (FAMILY CODE, Art.
the intention of 211).
returning ii. Illegitimate – domicile of the mother
(FAMILY CODE, Art. 176).
(Id. at 51-52).
In case of absence or death of either
NOTE: For political purposes the concepts of
parent, the domicile of the present
residence and domicile are dictated by the peculiar
parent shall fix the domicile. Even in
criteria of political laws. As these concepts have
case of the remarriage of the surviving
evolved in our election law, what has clearly and
parent, still his domicile determines the
unequivocally emerged is the fact that residence for
constructive domicile of the minor child
election purposes is used synonymously with
(SEMPIO-DIY, Conflict, supra at 55).
domicile, meaning that a person must not only intend
to reside in a particular place but must also have
personal presence in such place coupled with
 iii. Adopted – domicile of choice of the DOMICILE OF ORIGIN V.
adopter is the child's constructive CONSTRUCTIVE DOMICILE
domicile.
DOMICILE OF CONSTRUCTIVE
b. Insane, Idiots, Imbecile ORIGIN DOMICILE
They cannot select their own domicile. If the
insane, idiot or imbecile is: As to Acquisition
i. Below age of majority – rules on minors
Acquired at birth. Assigned after birth.
apply.
ii. Of age and has guardians – follow the As to Scope
domicile of choice of guardians.
iii. Does not have guardians – constructive Assigned only to Assigned to persons
domicile is his domicile of choice before infants. under legal disabilities.
he became insane (Id. at 55).
As to Nature
c. Married Women
If the marriage is valid, constructive Never changes. May change from time to
domicile of the wife is domicile of both time.
spouses, unless the law allows the wife to (Id. at 53-54).
have a separate domicile for valid and
compelling reasons (FAMILY CODE, Art. 3. Domicile of Choice or Voluntary
69).
i. If there is legal separation or
Domicile
– Place freely chosen by a person sui juris as his
separation de facto, the wife can have
home and to which, whenever he is absent, he
her own domicile of choice (De La Vina
intends to return (Id. at 53).
v. Villareal, G.R. No. 13982, July 31,
1920).
Requirements:
ii. If the marriage is voidable, apply the
a. Residence or bodily presence in a new
same rules as when the marriage is
locality;
valid. After annulment, the wife can
b. An intention to remain there (animus
freely select her own domicile of choice
manendi); and
(SEMPIO-DIY, Conflict, supra at 56).
c. An intention to abandon the old domicile
iii. If the marriage is void, as there is really
(animus non revertendi) (Romualdez v.
no marriage, the wife can have a
RTC, Branch 7, Tacloban City, G.R. No.
domicile separate from the husband (Id.
104960, September 14, 1993).
at 56).

d. Other Persons DOMICILE CONSTRUCTIVE DOMICILE OF

i. Convict or prisoner – he is not free to OF DOMICILE CHOICE
have a domicile of choice; his domicile ORIGIN
is that which he had possessed prior to
his incarceration. Assigned Assigned by law. Result of the
ii. Soldiers – since they are compelled to by law. voluntary will
follow the dictates of the military, and action of
domicile is that before their enlistment. the person
iii. Public officials or employees abroad like concerned.
diplomats, consular officials, etc. – since (SEMPIO-DIY, Conflict, supra at 54).
their stay abroad is in their official and
not in their personal capacity, their NOTE: Domicile of origin is not easily lost. To
domicile is the one before they were successfully effect a change of domicile, one must
assigned elsewhere, unless they demonstrate:
voluntarily adopt their place of 1. An actual removal or an actual change of
employment as their permanent domicile;
residence (SEMPIO-DIY, Conflict, 2. A bona fide intention of abandoning the former
supra at 56). place of residence and establishing a new one;
and
3. Definite acts which correspond with the purpose
(Romualdez-Marcos v. Commission on
Elections, G.R. No. 119976, September 18,
1995; Neo v. Yapha, Jr., G.R. No. 209285
(Notice), June 28, 2016).
In other words, there must basically be animus
manendi coupled with animus non revertendi. The
purpose to remain in or at the domicile of choice
must be for an indefinite period of time; the change
of residence must be voluntary; and the residence at
the place chosen for the new domicile must be actual
(Poe-Llamanzares v. Commission on Elections,
G.R. Nos. 221697-221700, March 8, 2016).
VENUE IN ESTATE PROCEEDINGS
The actual residence or place of abode of a person,
instead of his domicile, is significant in determining
the venue of estate proceedings and ordinary civil
actions (Jao v. CA, G.R. No. 128314, May 29, 2002).
For purposes of fixing venue under the Rules of
Court, the "residence" of a person is his personal,
actual or physical habitation, or actual residence or
place of abode, which may not necessarily be his
legal residence or domicile provided he resides
therein with continuity and consistency (San Luis v.
San Luis, G.R. No. 133743, February 6, 2007).
SITUS OR ECLECTIC THEORY
The capacity, condition, or status of a person is
governed by the law of the place (situs) where an
important element of the problem occurs or is
situated (SEMPIO-DIY, Conflict, supra at 57).
TWO KINDS OF PARTICIPATION OF THE
INDIVIDUAL CONCERNED
1. Active
– If the person acts voluntarily, the governing law
is the law of the actual situs of the transaction or
event; and
2. Passive
– When the effects of the act are set forth or
determined by law, the governing law is the law
of the legal situs, i.e., the domicile of the
individual concerned (Id. at 57).
GENERAL RULES ON DOMICILE:
1. No person shall be without domicile.
2. A person cannot have two simultaneous
domiciles.
3. Every natural person, as long as he is free and
sui juris, may change his domicile at his
pleasure.
4. Domicile, once acquired, is retained unless a
new one is gained.
5. The presumption is in favor of the continuance
of domicile. The burden of proof is on the one
who alleges that a change of domicile has taken
place.
6. To acquire a fresh domicile, residence and
intention must concur; to retain an existing
domicile, either residence there or intention to
remain must be present; to abandon a domicile,
residence in a new place and intention to
abandon the old place must concur (Gallego v.
Verra, G.R. No. 48641, November 24, 1941).
RENVOI
RENVOI
A procedure whereby a jural matter presented is
referred by the Conflict of Laws rules of the forum to
a foreign state, the Conflict of Laws rule of which in
turn refers the matter back to the law of the forum
(remission) or a third state (transmission) (COQUIA,
Conflict, supra at 102).
It is sometimes called “table tennis” theory, as the
law is being referred back and forth from the forum
law to the law of domicile of the foreign party which
involves a Conflict of Laws rule, pointing back to the
forum law as applicable law (AGPALO, Conflict,
supra at 38).
It is a French word which means “refer back” or
“return”. In Anglo-American countries, the term used
is “remission”, meaning to refer a matter for
consideration or judgment (SEMPIO-DIY, Conflict,
supra at 59).
In jurisdictions which have recognized the use of
renvoi in choice-of-law analysis, it has been
employed in cases where the domiciliary and
nationality laws are applied to the individual in issues
involving succession, domestic relations, and real
properties (COQUIA, Conflict, supra at 102).
The recognition of the renvoi theory implies that the
rules of the Conflict of Laws are to be understood as
incorporating not only the ordinary or internal law of
the foreign state or country, but its rules of the
Conflict of Laws as well. According to this theory 'the
law of a country' means the whole of its law (Aznar
v. Garcia, G.R. No. L-16749, January 31, 1963).
FOUR WAYS OF TREATING THE thru Philippine Law, ultimately applies Italian law
RENVOI PROBLEM (Id.).
1. Rejection (Internal Law Solution)
– If the Conflict rules of the forum refer the case RENVOI OR DOUBLE
TRANSMISSION
to the law of another state, it is deemed to mean REMISSION RENVOI
only the internal law of that state. Thus, the court
will apply the foreign law (PARAS, Conflict, Reference is Reference is That which
supra at 216). made back to made to a third occurs when
the law of state; involves the local
forum; three laws. court, in
2. Acceptance (Single Renvoi or Single
involves two adopting the
Transmission) laws. foreign court
– If the Conflict rules of the forum refer the case theory,
to the law of another state, it is deemed to discovers
include the totality of the foreign law (internal law that the
and Conflict of Laws rules). Thus, the court will foreign court
recognize the referral back and apply local law accepts the
(Id.). renvoi.
3. Desistment Theory (Mutual Disclaimer of (SEMPIO-DIY, Conflict of Laws, supra at 62).
Jurisdiction Theory)
– The forum court upon reference to another HOW TO RESOLVE RENVOI PROBLEM
state’s law sees that such law is limited in IN THE ABSENCE OF DEFINITIVE LAWS
application to its own nationals domiciled in its ON THE MATTER
territory and has no provision for application to
The theory to be adopted should be that which,
nationals domiciled outside of the territory.
considering the circumstances of a given situation,
Hence, the local court will apply local law.
will best result in fairness, equity, and justice (Id. at
217).
This has the same result as the acceptance of
the renvoi doctrine but the process used by the
forum court is to desist applying the foreign law WAIVER OF RENVOI
(Id.). To prevent complications, parties may even waive
the application of renvoi in case the same is provided
4. Foreign Court Theory for by a foreign law. Rules of private international law
– Forum court assumes the same position that will find no application once a foreign law is chosen
the foreign court would take if the case is by the parties (PE BENITO, Conflict, supra at 96).
litigated in the foreign state (Id.).

DOUBLE RENVOI
– that which occurs when the local court, in adopting PERSONAL STATUS
the foreign court theory, discovers that the foreign AND CAPACITY
court accepts the renvoi (SEMPIO-DIY, Conflict,
supra at 62).

TRANSMISSION To restate, Status refers to the place of an individual

– the process of applying the law of a foreign state in society and consists of more or less permanent
through the law of a second foreign state (Id. at 62). personal qualities and relationships with which the
state and community are concerned (PARAS,
It is not the same as renvoi. Renvoi involves two (2) Conflict, supra at 222).
laws while transmission involves three (3) laws
(PARAS, Conflict, supra at 215). RULES ON STATUS
FACTUAL SITUATION POINT OF CONTACT
Illustration: An Italian domiciled in the Philippines
dies in England. If the case is tried in England, the Beginning of personality
English court (following the domiciliary theory) refers of natural persons
to the law of the Philippines, but discovers that the National law of the Child
Age of Majority
Philippines, in turn, refers the matter to Italy (CIVIL CODE, Art. 15)
(following our nationality theory). Hence, England, Use of Names and
Surnames
 FACTUAL SITUATION POINT OF CONTACT
Use of Titles of Nobility
Absence
Presumptions of Death Lex Fori
and Survivorship
(Id. at 222)
As stated above, Capacity is a part of one’s status
and is the sum total of one’s rights and obligations
(Id.).
KINDS OF CAPACITY:
1. Capacity to Act
– power to do acts with legal effect; and
2. Juridical Capacity
– the fitness to be the subject of legal relations.
In the determination of status and capacity of
persons, our Civil Code follows the nationality
principle when dealing with Filipinos (SEMPIO-DIY,
Conflict, supra at 70).
When dealing with aliens, it depends on which
principle their country follows, but if the alien is in the
Philippines, the nationality theory is applied by
implication (Id. at 70).
A person's capacity to contract is governed by his
personal law, whether it is the lex nationalii or the lex
domicilii. The exception in the Philippines are
contracts involving real or personal property in which
cases the lex situs or lex rei sitae applies (Id. at 70).
Illustration: A citizen of state X wants to apply for
Philippine naturalization. In state X, he is already
considered of major age, being 15 years old.
Philippine naturalization laws explicitly state that he
must be 18 years old in order to be naturalized. At
the age of 15, may he already file his petition to be a
Filipino citizen?
Answer: Yes, provided that at the time of the
hearing of the petition he is already 18 years old. If
at the said time he is not yet 18 years of age, the
hearing of the petition will have to be postponed,
notwithstanding the fact that in his own country, he
has already reached the age of majority (PARAS,
Conflict, supra at 226).
FAMILY RELATIONS
Under the Civil Code, questions of family rights,
duties, status, conditions, and capacity are governed
by lex nationalii (CIVIL CODE, Art. 15).
MARRIAGE
Marriage is a union of one man with one woman or
the reciprocal blessings of a domestic home life, and
for the birth, rearing, and education of children
(PARAS, Conflict, supra at 232).
Of all domestic relations, marriage is the most
important. The validity of a marriage contracted in
one State may be at issue in another State in cases
of annulment, actions for support and custody of
children, proceedings involving legitimacy of
children, tax cases, divorce suits, inheritance
problems, or criminal prosecution for bigamy
(SALONGA, Conflict, supra at 255).
1. MARRIAGE AS A CONTRACT
a. Extrinsic Validity – governed by lex loci
celebrationis.
REASON: The predictability and the
interstate order arising from society’s
interest in marriage (PE BENITO, Conflict,
supra at 265).
Formal Requisites of Marriage under
Philippine Law:
i. Authority of the solemnizing officer;
ii. Valid marriage license except in the
cases provided for in Chapter 2 of Title
I; and
iii. A marriage ceremony which takes place
with the appearance of the contracting
parties before the solemnizing officer
and their personal declaration that they
take each other as husband and wife in
the presence of not less than two
witnesses of legal age (FAMILY CODE,
Art. 3).
GENERAL RULES:
i. All states recognize as valid those
marriages celebrated in foreign
countries if they comply with the
formalities prescribed therein (Hague
Convention).
ii. The forms and solemnities of contracts,
wills, and other public instruments shall
be governed by the laws of the country
in which they were executed (CIVIL
CODE, Art. 17).
 iii. All marriages solemnized outside the
Philippines, in accordance with the laws
in force in the country where they were
solemnized, and valid there as such,
shall also be valid in this country
(FAMILY CODE, Art. 26).
EXCEPTIONS:
The following are void marriages in the
Philippines even if valid in the foreign
country where celebrated:
i. Same-sex marriages, as contracting
parties must be male and female
(FAMILY CODE, Art. 2);
ii. When either or both parties are below
18 years of age even with parental
consent (FAMILY CODE, Art. 35, par.
1);
iii. Bigamous and polygamous marriages
(FAMILY CODE, Art. 35, par. 4);
iv. Mistake as to identity of a contracting
party (FAMILY CODE, Art. 35, par. 5);
v. A subsequent marriage performed
without recording in the Civil Registry
the judgment of annulment or
declaration of nullity, partition and
distribution of properties, and the
delivery of the children’s presumptive
legitimes (FAMILY CODE, Art. 53);
vi. Marriages where either spouse is
psychologically incapacitated (FAMILY
CODE, Art. 36);
vii. Incestuous marriages (FAMILY CODE,
Art.37); and
viii. Void marriages by reason of public
policy (FAMILY CODE, Art. 38).
NOTE: These exceptions put into issue the
capacity of the parties to enter into the
marriage and relate to the substantive
requirement for marriage. Since the
personal law of the parties, e.g., the national
law of Filipinos, governs the questions of
intrinsic validity of marriages between
Filipinos abroad, the above enumerations
are exceptions to lex loci celebrationis
precisely because they are controlled by lex
nationalii (SEMPIO-DIY, Conflict, supra at
77).
b. Intrinsic Validity – controlled by the parties’
personal laws, i.e., either domiciliary or
nationality.
Intrinsic Requirements of Marriage under
Philippine Law (FAMILY CODE, Art. 2):
i. Legal capacity of the contracting parties
who must be male and female; and
ii. Consent freely given in the presence of
the solemnizing officer.
Marriage Contracted Outside the Philippines
The Philippines follows the imperative or
compulsory rule which means that a marriage
formally valid where celebrated is valid
elsewhere (CIVIL CODE, Art. 17(1); FAMILY
CODE, Art. 26).
Marriage performed by a consular or diplomatic
agent empowered by the sending state to
officiate marriage is valid in the receiving state,
only if the latter has agreed to his acting in that
capacity (SALONGA, Conflict, supra at 263).
REASON: When the parties choose a place as
the loci celebrationis of their marriage, they are
considered to have subjected all questions of
form to the law of that place, and if valid there it
should be considered valid everywhere (Id.).
Illustration:
a. Filipino first cousins got married in
California, where the marriage is considered
valid. Will their marriage be recognized in
the Philippines?
Answer: No, because such marriage is
incestuous as determined by Philippine Law
(PARAS, Conflict, supra at 236).
b. A Filipino step-brother wanted to marry his
Filipino step-sister in the Philippines, but
because in our country, a step-brother
cannot validly marry his step-sister, the two
decided to get married in California, where
the marriage is valid. Will our country
recognize the validity of their marriage
abroad?
Answer: Yes, because it is valid in the place
of celebration and the marriage is neither
bigamous, polygamous, or incestuous as
determined by Philippine law (Id. at 236;
FAMILY CODE, Art. 26).
Note: If this marriage has been performed
inside the Philippine consulate in San
Francisco by our consul or vice-consul, the
marriage will be deemed to have taken
place in the Philippines, and will therefore be
considered void (PARAS, Conflict, supra at
237).
RULES ON EXTRINSIC VALIDITY OF
CERTAIN SITUATIONS:
a. Proxy Marriages
GENERAL RULE: Where permitted by the
law of the place where the proxy participates
in the marriage ceremony, they are entitled
to recognition in countries adhering to lex
 loci celebrationis rule, at least insofar as b. Marriage between a Filipino and a
formal validity is concerned (SEMPIO-DIY, Foreigner in the Philippines
Conflict, supra at 77). – Philippine law should be followed;
otherwise, public policy would be violated
NOTE: Philippine law does not sanction (Id. at 78).
proxy marriages; but if celebrated in a
foreign state in accordance with the RULES ON MARRIAGE IF
formalities prescribed by its laws, it may be
recognized in the Philippines under the lex CELEBRATED ABROAD
loci celebrationis rule (Id. at 77). OR IN THE PHILIPPINES
FACTUAL
POINT OF CONTACT
b. Common Law Marriages SITUATION
If valid in the State where the parties
cohabited while holding themselves out as If Celebrated Abroad
man and wife, it is given recognition in sister Between Lex loci celebrationis without
States which do not permit this informal Filipinos prejudice to the exceptions
method of entering into the marital status. under Arts. 26, 35 (1), (4), (5),
and (6), 36, 37, and 38 of the
NOTE: Common law marriages are not FAMILY CODE (bigamous,
recognized under Philippine law (PARAS, polygamous, and incestuous
Conflict, supra at 235). marriages), and consular
marriages.
c. Marriage on Board a Vessel on High
Seas Between Lex loci celebrationis except if
Since the nation whose flag the ship is flying foreigners the marriage is:
has jurisdiction over the ship, compliance 1. Highly immoral (like
with this law is required for a marriage to be bigamous and polygamous
validly contracted (Id. at 77). marriages); or
2. Universally considered
incestuous.
d. Consular Marriages
Marriages between Filipino citizens abroad Mixed Apply above (number 2) – to
may be solemnized by a consul-general, uphold the validity of the
consul, or vice-consul of the Philippines marriage.
(FAMILY CODE, Art. 10).
If Celebrated in the
e. Plural Marriages Philippines
If the parties or at least the husband is a Between National law (Art. 21, FAMILY
Muslim (whose religion allows plural foreigners CODE), provided the marriage
marriages), it is believed that we would is not highly immoral or
recognize up to four marriages of the same universally considered
husband (as recognized by the Philippine incestuous.
Muslim Code on Personal Laws) to protect
the rights of the wives and children Mixed National law of the Filipino
(SEMPIO-DIY, Conflict, supra at 77). (otherwise, public policy may be
militated against).
MIXED MARRIAGES: Marriage by Lex loci celebrationis (with
a. Marriage Between a Filipino and a proxy prejudice to the foregoing
Foreigner abroad rules).
– If the marriage is valid under the law of one NOTE: A
of the spouses while void under the law of marriage by
the other, we should uphold the validity of proxy is
the marriage, unless the marriage is considered as
universally incestuous or highly immoral (Id. celebrated where
at 77). the proxy
appears.
NOTE: Same rule as to foreigners who
marry abroad. (PARAS, Conflict, supra at 233-234).
2. MARRIAGE AS A STATUS FACTUAL SITUATION POINT OF CONTACT
Marriage is not a mere contract but an inviolable
the wife's rights
social institution. Its nature, consequences, and
(SEMPIO-DIY,
incidents are governed by law and not subject to
Conflict, p. 80).
stipulation (FAMILY CODE, Art.1).
Property relations The Hague Convention
RULES ON NATURE, CONSEQUENCES, between husband and declares that the
AND INCIDENT OF MARRIAGE wife. governing law on
matrimonial property
FACTUAL SITUATION POINT OF CONTACT regime is:
Personal rights and National law of the 1. The internal law
obligations between husband. designated by the
husband and wife (mutual spouses before the
fidelity, cohabitation, Effect of subsequent marriage;
respect, assistance and change of nationality: 2. In the absence
support; right of wife to 1. If both will have a thereof, the internal
use husband's name; new common law of the state in
duty to follow husband's nationality – the new which the spouses
residence) one. fix their 1st habitual
2. If only one will residence.
change – the last
common nationality. NOTE: Effect of
3. If the spouses retain change of nationality –
their different no effect. This is the
nationalities after doctrine of
the marriage, it has immutability in the
been suggested that matrimonial property
the national law of regime.
both spouses (PARAS, Conflict, supra at 243-244)
should govern.
REASON: When the woman marries a foreigner,
Another writer she usually loses her nationality and instead follows
suggests that the that of the husband. Moreover, the husband is
law of the husband usually the head of the family, so the husband’s
at the time of the personal law governs the personal relations of the
marriage should be spouses (SEMPIO-DIY, Conflict, supra at 79).
applied.
In the Philippines, personal relations of the spouses
Reason: It will not are governed by Philippine law since we follow the
necessarily be nationality theory. In countries that follow the
unfair to the wife, domiciliary theory, the law of their domicile governs.
because the
national law of the It is the national law of the wife or Philippine law that
husband may be would govern the spouses’ personal relations by
even more favorable parity of reasoning with Art. 80 of the Family Code
to her. (Id. at 79).

Some exceptions to the The marriage of an alien woman to a Filipino

above rule are: husband does not ipso facto make her a Filipino
1. If the national law of citizen and does not excuse her from her failure to
the husband depart from the country upon the expiration of her
violates the public extended stay here as an alien (Djumantan v.
policy of the forum; Domingo, G.R. No. 99358, January 30, 1995).
or
2. The national law of PHILIPPINE RULE ON PROPERTY
the wife happens to
be the law of the
RELATIONS
forum, as it is In the absence of a contrary stipulation in the
intended to protect marriage settlements, the property relations of the
spouses shall be governed by Philippine laws,
regardless of the place of the celebration of the
FACTUAL SITUATION POINT OF CONTACT
marriage and their residence (SEMPIO-DIY,
Conflict, supra at 81). If obtained abroad National Law (if valid in
between foreigners the state granting it and
This rule shall NOT apply: valid according to the
1. Where both spouses are aliens, in which cases national law of the
the general rule in Conflict of Laws will apply (Id. parties, it will be valid
at 82); here)
2. With respect to the extrinsic validity of contracts
affecting property not situated in the Philippines If obtained abroad If valid in the state
and executed in the country where the property between a Filipino and granting it and valid
is located; and a foreigner according to the
3. With respect to the extrinsic validity of contracts national law of the
entered into in the Philippines but affecting foreigner, it will be valid
property situated in a foreign country whose here (See Republic v.
laws require different formalities for their Manalo, G.R. No.
extrinsic validity (FAMILY CODE, Art. 80). 221029, April 24, 2018).
(PARAS, Conflict, supra at 263).
DOCTRINE OF IMMUTABILITY OF
MATRIMONIAL PROPERTY REGIME THE HAGUE CONVENTION ON THE
Regardless of the change of nationality by either or RECOGNITION OF DIVORCE AND
both of the spouses, the original property regime
existing at the start of their marriage prevails LEGAL SEPARATION
(SEMPIO-DIY, Conflict, supra at 82). A foreign divorce will be recognized in contracting
states if, at the date of the filing of the proceedings:
REASONS: 1. The petitioner or the respondent had habitual
1. Marital peace in the spouses' property relations residence in the state where the divorce was
is more or less guaranteed; obtained;
2. The spouses will not be able to prejudice 2. Both spouses were nationals of said state; or
creditors, who in turn can jeopardize the 3. Although the petitioner was a national of another
interests of the spouses; and country, he or she had his or her residence in
The spouses may protect themselves from each the place where the divorce was obtained
other (Id. at 82). (CONVENTION OF 1 JUNE 1970 ON THE
RECOGNITION OF DIVORCES AND LEGAL
ABSOLUTE DIVORCE (A VINCULO SEPARATIONS, Art. 2).
MATRIMONII)
RULES ON DIVORCE IN THE
The Hague Convention provides that the granting of
divorce or separation must comply with the national PHILIPPINES
law of the spouses and the law of the place where GENERAL RULE: We only observe relative divorce
the application for divorce is made. or legal separation (a mensa et thoro) in the
Philippines.
DIVORCE
EXCEPTIONS:
The legal dissolution of marriage bond rendered by 1. Where a marriage between a Filipino citizen and
a competent court for causes defined by law which a foreigner is validly celebrated and a divorce is
arose after a valid marriage (AGPALO, Conflict, p. thereafter validly obtained abroad capacitating
324). the alien spouse to remarry, the Filipino spouse
shall have capacity to remarry under Philippine
RULES ON DIVORCE law (FAMILY CODE, Art. 26);
FACTUAL SITUATION POINT OF CONTACT
Severing marital ties between parties in a mixed
If sought in the Lex Fori (will not be marriage and capacitating the Filipino spouse to
Philippines (whether by granted) remarry as a necessary consequence of
Filipinos or foreigners) Exception: Muslim upholding the validity of a divorce obtained
Divorce abroad by the alien spouse. If the foreigner
obtains a valid foreign divorce, the Filipino
If obtained abroad National Law (thus, not spouse shall have capacity to remarry under
between Filipinos valid here even if valid Philippine law. (San Luis v. San Luis, G.R. Nos.
abroad) 133743, February 6, 2007).

2. Valid divorce obtained abroad between
foreigners whose national laws allow divorce.
NOTE: The reckoning point is not the citizenship of
the parties at the time of the celebration of the
marriage, but their citizenship at the time a valid
divorce is obtained abroad by the alien spouse
capacitating the latter to remarry (Republic v.
Orbecido III, G.R. No. 154380, October 5, 2005).
Even if the marriage is not a mixed marriage, i.e.,
both are Filipino citizens at the time of celebration of
marriage, if one of the spouses later becomes a
foreign citizen and obtains a valid foreign divorce
decree, the spouse who did not change his/her
citizenship, i.e., Filipino, will be considered
capacitated to remarry (Republic v. Orbecido III,
G.R. No. 154380, October 5, 2005).
LIMITED RECOGNITION OF DIVORCE
OBTAINED ABROAD
If the non-recognition of divorce will work injustice
and unfairness to Philippine nationals, the same may
be given limited recognition in our jurisdiction (PE
BENITO, Conflict, supra at 283).
A divorce abroad is considered valid in the
Philippines, even if it is the Filipino spouse who files
for divorce abroad. Based on a clear and plain
reading of the provision, Art. 26, Par. 2 of the Family
Code only requires that there be a divorce validly
obtained abroad. The letter of the law does not
demand that the alien spouse should be the one who
initiated the proceeding wherein the divorce decree
was granted. It does not distinguish whether the
Filipino spouse is the petitioner or the respondent in
the foreign divorce proceeding. The Court is bound
by the words of the statute; neither can we put words
in the mouths of the lawmakers (Republic v. Manalo,
G.R. No. 221029, April 24, 2018).
Owing to the nationality principle embodied in Article
15 of the Civil Code, only Philippine nationals are
covered by the policy against absolute divorces the
same being considered contrary to our concept of
public policy and morality. However, aliens may
obtain divorces abroad, which may be recognized in
the Philippines, provided they are valid according to
their national law (Van Dorn v. Romillo, Jr., G.R. No.
L-68470, October 8, 1985).
RECOGNITION OF FOREIGN DIVORCE
While the law requires the entry of the divorce
decree in the civil registry, the law and the
submission of the decree by themselves do not ipso
facto authorize the decree's registration. The law
should be read in relation with the requirement of a
judicial recognition of the foreign judgment before it
can be given res judicata effect (Corpuz v. Sto.
Tomas, G.R. No. 186571, August 11, 2010).
NATURE OF RECOGNITION OF
DIVORCE PROCEEDINGS
A petition for recognition of foreign judgment is a
special proceeding, which "seeks to establish a
status, a right or a particular fact," and not a civil
action which is "for the enforcement or protection of
a right, or the prevention or redress of a wrong"
(Fujiki v. Marinay, G.R. No. 196049, June 26, 2013).
The recognition of the foreign divorce decree may be
made in a Rule 108 proceeding itself, as the object
of special proceedings (such as that in Rule 108 of
the Rules of Court) is precisely to establish the
status or right of a party or a particular fact (Fujiki v.
Marinay, G.R. No. 196049, June 26, 2013).
CORRECTION OF ENTRY
Article 412 of the Civil Code declares that "no entry
in a civil register shall be changed or corrected,
without judicial order." The Rules of
Court supplements Article 412 by specifically
providing for a special remedial proceeding by which
entries in the civil registry may be judicially cancelled
or corrected. This ruling should not be construed as
requiring two separate proceedings for the
registration of a foreign divorce decree in the civil
registry — one for recognition of the foreign decree
and another specifically for cancellation of the entry
under Rule 108 of the Rules of Court (Corpuz v. Sto.
Tomas, G.R. No. 186571, August 11, 2010).
EFFECTS OF DIVORCE OBTAINED
ABROAD BY THE FOREIGNER SPOUSE
1. The foreign national may not go against the
Filipino spouse for accounting of conjugal
property after the issuance of a divorce decree
(Van Dorn v. Romillo, G.R. No. L-68470,
October 8, 1985);
2. The foreign spouse can no longer claim to be the
spouse of his or her Filipino partner (PE
BENITO, Conflict, supra at 283);
3. The foreign spouse cannot maintain a criminal
case of adultery and concubinage against the
former spouse (Pilapil v. Ibay-Somera, G.R. No.
80116, June 30, 1989);
4. The Filipino spouse is endowed with capacity to
remarry, and his/her subsequent spouse can file
a petition for letters of administration (San Luis
v. San Luis, G.R. No. 133743, February 6,
2007); and
5. The legal effects of the divorce on custody, care
and support of the children must still be
determined by our courts (Roehr v. Rodriguez,
G.R. No. 142820, June 20, 2003).
RIGHT TO RE-MARRY AFTER DIVORCE
Filipinos are allowed to remarry once their foreign
spouses are capacitated to remarry by a divorce
decree (FAMILY CODE, Art. 26, par. 2). However,
the divorce must be judicially recognized first by
Philippine courts and annotated in the local civil
registry before the Philippine national can remarry
(PE BENITO, Conflict, supra at 292).
NOTE: Whether the Filipino spouse initiated the
foreign divorce proceeding or not, a favorable
decree dissolving the marriage bond and
capacitating his or her alien spouse to remarry will
have the same result: the Filipino spouse will
effectively be without a husband or wife. A Filipino
who initiated a foreign divorce proceeding is in the
same place and in like circumstance as a Filipino
who is at the receiving end of an alien-initiated
proceeding. Therefore, the subject provision (Article
26, par. 2 of the Family Code) should not make a
distinction (Republic v. Manalo, G.R. No. 221029,
April 24, 2018).
LEGAL SEPARATION OR RELATIVE
DIVORCE (A MENSA ET THORO)
CONFLICT RULES ON LEGAL SEPARATION:
1. Parties of the Same Nationality
– grounds for legal separation are those given
by their personal law (SEMPIO-DIY, Conflict,
supra at 90).
2. Parties are of Different Nationalities
– grounds available under the personal law of
both spouses are all available grounds for
granting legal separation (Hague Convention on
Legal Separation, Art. 8).
SOME GROUNDS FOR LEGAL SEPARATION
FACTUAL
POINT OF CONTACT
SITUATION
Grounds for legal National law of the parties
separation: 1. If of the same or common
1. Adultery nationality – national law
2. Concubinage governs
3. Attempt by one 2. If of different nationalities
spouse against – the grounds given by
the life of the both national laws should
other all be considered proper
grounds (Hague
Convention on Legal
Separation, Art. 8).
WHERE LEGAL SEPARATION SHOULD
BE FILED:
1. In the case of aliens, jurisdiction is not assumed
by the forum unless the national law of the
parties is willing to recognize its jurisdiction;
2. In the Philippines, foreigners may ask for legal
separation here, even if they did not get married
in this country. What is important is that the court
has jurisdiction over both parties;
3. Most countries assume jurisdiction over cases
for legal separation on the basis of the domicile
of one of the parties or the matrimonial domicile
(SEMPIO-DIY, Conflict, supra at 91).
NOTE: It is not necessary that the cause for legal
separation takes place in this country for our courts
to have jurisdiction over the case. What is important
is that the court has jurisdiction over the parties and
that the procedural requirements of the Rules of
Court are complied with (Id. at 91).
ANNULMENT AND DECLARATION OF
NULLITY
ANNULMENT
– remedy if the marriage is voidable; grounds are
those provided for by the law alleged to have been
violated (Id. at 83).
DECLARATION OF NULLITY
– remedy if the marriage is void ab initio; grounds
are the exceptions to the Lex Loci Celebrationis in
Family Code, Art. 26.
NOTE: The above rules do not apply to consular
marriages to which either the national law or the law
of the domicile of the parties, as the case may be,
applies (Id. at 86).
JURISDICTION TO ANNUL
It is vested in the court of the nationality or domicile
of the parties, not the place of celebration of
marriage or the locus celebrationis (AGPALO,
Conflict, supra at 333).
REASON: It is the State of the domicile that has the
greatest interest in the domestic relations of the
parties (SALONGA, Conflict, supra at 278).
NOTE: Under Rule 14, Section 17 of the Rules of
Court, when the defendant is not a resident of the
Philippines and the action affects the personal status
of the plaintiff, summons may be served by
publication in a newspaper of general circulation.
GOVERNING LAW
Lex loci celebrationis determines the consequences
of any defect to form (SEMPIO-DIY, Conflict, supra
at 85).
Generally, the same applies with reference to
substantive or intrinsic validity. But with regard to
capacity of the parties to marry, their national law is
determinative.
PHILIPPINE RULE
Since we follow the nationality theory, our courts
have jurisdiction over annulment and nullity suits in
marriage in cases of Filipino litigants. Philippine
domiciliaries can also file such suits in the
Philippines (Id. at 86).
STATUS OF CHILDREN
1. LEGITIMACY AND ILLEGITIMACY
Determination of Legitimacy of a Child
Governed by the common personal law of the
parents, either domiciliary or nationality. In most
countries, the personal law of the father is
applied to determine the legitimate relationship
(COQUIA, Conflict, supra at 289).
Philippine Rule for Status and Personal Law
Governing Rights and Duties between Child
and Parents
a. Legitimacy governed by parents’ national
law (SEMPIO-DIY, Conflict, supra at 94).
b. Legitimacy governed by the national law of
the father, if parents have different
nationalities (Id. at 94).
c. Personal law of the illegitimate child is the
mother’s personal law, unless the child is
recognized by the father, in which case the
personal law of the father applies (Id. at 96).
NOTE: However, in the case of Tecson v.
COMELEC, Ronald Allan Kelly Poe and Fornier,
G.R. No. 161434, March 3, 2004, the Supreme
Court held that providing neither conditions nor
distinctions, the 1935 Constitution (the
fundamental law prevailing on the day, month
and year of birth of respondent FPJ), states that
among the citizens of the Philippines are those
whose fathers are citizens of the Philippines,
regardless of whether the children are legitimate
or illegitimate.
Doctrine of Immutability of Status
The status of the legitimate or illegitimate child
is not affected by a subsequent change of
nationality of the parents. If the child is later
legitimated, the personal law of the child follows
that of the father (SEMPIO-DIY, Conflict, supra
at 96).
However, the rights and duties of parent and
child would be governed by the new national law
of the parents, and thus, may be mutable (Id. at
96).
Parental Authority over the Child
Derived from the Roman law concept of patria
potestas, a principle wherein the personal law of
the father controls the rights and duties of
parents and children (COQUIA, Conflict, supra
at 291).
NOTE: Reference to the personal law of the
father may result in joint exercise of parental
authority over the property of the child by the
father and the mother (i.e., Art. 221, Family
Code). Father’s personal law could also grant
parental authority to the mother of the
illegitimate children (i.e., Art. 176, Family Code).
2. LEGITIMATION
It is a process whereby children who in fact were
not born in a lawful wedlock, and should be
ordinarily considered illegitimate children, are by
fiction of law and upon compliance with certain
legal requirements regarded by law as
“legitimate”, it being supposed that they were
born after their parents had already been validly
married (SEMPIO-DIY, Conflict, supra at 97).
The requisites of legitimation are those
prescribed by the national law of the parents. If
the parents have different national laws, the
national law of the father is determinative (Id. at
97).
If the personal law of the parents or of the father
changes, the legitimation of the child is not
affected as legitimation creates a permanent,
immutable status of the child (SALONGA,
Conflict, supra at 326).
NOTE: Once legitimacy is created under the law
of the parent, either by birth of the child or
legitimation, it is already a permanent status. But
the nature and extent of the rights and duties
flowing as incidents from the status of legitimacy
may be modified by a change of the personal law
deemed to be decisive for the child’s status. In
short, the child’s legitimacy is immutable; but the
incidents of his status are mutable (Id. at 326).
3. ADOPTION
A juridical act, a proceeding in rem, which
creates between two persons a relationship
similar to that which results from legitimate
paternity and filiation (AGPALO, Conflict, supra
at 277).
The creation of a parent–child relationship by
judicial order between two parties who usually
are unrelated (BLACK’S LAW DICTIONARY, 8th
ed., 2004).
 The determinative law as to whether the
relationship of adoption has been created or not
is as follows:
a. The child’s personal law, to protect his well-
being;
b. If the child does not reside in the country of
his citizenship, the personal law of the
adopter will govern, or the personal law of
the adopter and that of the child will be
applied concurrently (SEMPIO-DIY,
Conflict, supra at 100).
GENERAL RULE: The legal effect of the
adoption is determined by the same law that
created the relationship of adoption (Id. at 100).
EXCEPTION: Where public policy or the
interests of its inhabitants forbid its enforcement
and demand the substitution of the lex fori
(AGPALO, Conflict, supra at 279).
Legal Effects that Flow from Adoption:
a. The successional rights of the adopted child;
b. The parental authority of the adopter over
the adopted child; and
c. The entitlement of the adopted child to all
the rights and obligations provided by law to
legitimate children (R.A. No. 8552, Sections
16-18).
Under the Domestic Adoption Act of 1998 (R.A.
No. 8552), an Alien (Who is Not a Former Filipino
Citizen) May Adopt, Provided that he is:
a. Of legal age;
b. In possession of full civil capacity and legal
rights;
c. Of good moral character;
d. Not convicted of any crime involving moral
turpitude;
e. Emotionally and psychologically capable of
caring for children;
f. At least sixteen (16) years older than the
adoptee;
g. In a position to support and care for his children;
h. His country has diplomatic relations with the
Philippines;
i. A resident in the Philippines for at least three
continuous years prior to the filing of the
application for adoption and he maintains such
residence until the adoption decree is entered;
j. Issued a certificate of legal capacity to adopt in
his country by his diplomatic or consular office;
and
k. His government allows the adoptee to enter his
country as his adopted son/daughter (R.A. 8552,
Sec. 7).
The Requirement on Residency and Certificate
of Qualification to Adopt may be Waived for the
following:
a. A former Filipino citizen who seeks to adopt a
relative within the fourth (4th) degree of
consanguinity/affinity;
b. One who seeks to adopt the legitimate
son/daughter of his/her Filipino spouse; or
c. One who is married to a Filipino citizen and
seeks to adopt jointly with his/her spouse a
relative within the fourth (4th) degree of
consanguinity or affinity of the Filipino spouse
(R.A. 8552, Sec. 7).
NOTE: R.A. 8552 still requires that the husband and
wife must jointly adopt. Where the spouses are
legally separated, the husband or the wife can adopt
alone and the consent of the other spouse is no
longer necessary (SEMPIO-DIY, Conflict, supra at
102).
The requirement of sixteen (16) years difference
between the adopter and the adoptee may be
waived if the adopter is:
a. The biological parent of the adoptee; or
b. The spouse of the adoptee’s parent (R.A. 8552,
Sec. 7).
NOTE: Justice Sempio-Diy is of the opinion that
under Sec. 48, Rule 39 of the Rules of Court, the
Philippines can recognize a foreign decree of
adoption provided:
a. The foreign court had jurisdiction to render said
decree, and
b. There was no want of notice, collusion, extrinsic
fraud, or clear mistake of law or fact leading to
the foreign decree of adoption (SEMPIO-DIY,
Conflict, supra at 104).
Inter-Country Adoption
A socio-legal process of adopting a Filipino child by
a foreigner or a Filipino citizen permanently residing
abroad where the petition is filed, the supervised trial
custody is undertaken, and the decree of adoption is
issued outside the Philippines. This is an alternative
means of child-care if the child cannot be cared for
in any suitable manner in the Philippines (R.A. No.
8043, Sec. 3).
NOTE: Adoption is not one of the ways prescribed
by law for the acquisition of Filipino citizenship.
Adoption does not confer on the adopted child the
citizenship of the adopter. Adoption is political, and
not civil, in nature, and the ways in which it should
be conferred lay outside the ambit of the Civil Code
(In re Malkinson v. Agrava, G.R. No. L-36309,
November 26, 1973).
Law Governing the Adoption Proceeding RULES ON FUNERALS
An alien qualified to adopt under the Child and Youth
Welfare Code, which was in force at the time of the FACTUAL SITUATION POINT OF CONTACT
filing of the petition, acquired a vested right which Funerals – incidents Where the body is
could not be affected by the subsequent enactment thereof buried
of a new law disqualifying him. Consequently, the
enactment of the Family Code, effective August 3, (SEMPIO-DIY, Conflict, supra at 303)
1988, will not impair the right of respondents who are
aliens to adopt a Filipino child because the right has
become vested at the time of filing of the petition for
adoption and shall be governed by the law then in
force (Republic v. Miller, G.R. No. 125932, April 21,
PROPERTY
1999).

Recording of Foreign Adoptions Not Inimical to

Private International Law ELEMENTS OF CONFLICT OF LAWS ON
Private International Law offers no obstacle to PROPERTY OWNERSHIP:
recognition of foreign adoption, the principle being 1. There is a dispute over the title or ownership of
that the status of adoption, created by the law of a a property, such that the capacity to take and
State having jurisdiction to create it, will be given the transfer, the formalities of conveyance, the
same effect in another state as is given by the latter essential validity and effect of the transfer, or the
state to the status of adoption when created by its interpretation and effect of conveyance, are to
own law. The status of adoption, once created under be determined; and
the proper foreign law, will be recognized in this 2. A foreign law on ownership and conveyance is
country except where public policy or the interests of asserted to Conflict with a domestic law on the
its inhabitants forbid its enforcement and demand same matters (PE BENITO, Conflict, supra at
the substitution of the lex fori. Implicit in Art. 15 of the 250).
Civil Code is that the exercise of incidents to foreign
adoption remains subject to the local law (Marcaida Lex situs or lex rei sitae – real property as well as
v. Aglubat, G.R. No. L-24006, November 25, 1967). personal property is subject to the law of the country
where it is situated (CIVIL CODE, Art. 16).
(Please see Remedial Law Memory Aid for the
Procedure for Adoption and Persons and Family
RULES ON PROPERTY
Relations under this Book on the Domestic and Inter-
Country Adoption Laws.) FACTUAL
POINT OF CONTACT
SITUATION
RULES ON GUARDIANSHIP
Real Property Lex Rei Sitae (CIVIL CODE,
FACTUAL SITUATION POINT OF CONTACT Art. 16, par. 1).
EXCEPTIONS:
1. Over the person 1. Court of the domicile 1. Contracts not
a. Appointing court of the ward dealing with title
b. Powers of 2. Coextensive with over real
guardianship those of the property – Lex
appointing court Loci Voluntatis
(law of the or Lex Loci
appointing state) Intentionis.
2. Real property is
2. Over the property 1. Court where the
given as
a. Appointing court property is found
security –
b. Powers of (lex rei sitae)
mortgage
guardianship 2. Co-extensive with
governed by lex
those of the
rei sitae,
appointing court
principal
(law of the
contract
appointing state)
governed by
c. Over the person and Same as above proper law of
over the property the contract.
(general guardian)
 FACTUAL FACTUAL
POINT OF CONTACT POINT OF CONTACT
SITUATION SITUATION

Tangible Lex Rei Sitae Intangible 1. Voluntary transfer or

Personal Personal assignment of choses in
Property (Choses EXCEPTION: Artificial or Property (Choses action – Personal law of
in Possession) Constructive Situs is given in Action) the parties, law of the
Same Exceptions to those which do not have a place of execution of
under Real fixed situs (usually in assignment, law of place
Property but motion). where debt is
security is pledge, recoverable.
not mortgage. 2. Involuntary transfer of
choses in action, e.g.,
Means of Sea Going Vessels – Law of garnishment – law of the
transportation the flag. state where debtor may
be served summons.
In states consisting of 3. Debt for Taxation
several countries, e.g., Purposes – domicile of
United Kingdom, Law of the creditor, where the
place of registry, or Law of collectible credit may be
the depot. taxed.
4. Administration of debts –
Thing in Transitu Loss, destruction, where the assets of the
Loss, destruction, deterioration - Law of the debtor are usually
deterioration, destination (CIVIL CODE, situated.
validity/effect of Art. 1753).
seizure, Capacity to 1. Lex situs
disposition/ Seizure and arrest – Where transfer or EXCEPTION: Voluntary
alienation. the owner’s creditor seizes acquire property transfer of interests in
the goods in transit, the chattels (other than
result is that the transport is assignment for the benefit
discontinued and a of creditors) – validity and
temporary resting place is effect of conveyance
thereby created. The law of between the parties
this place will depend on determined by the local
whether the seizure was law of the State which has
lawful or whether he has the most significant
acquired a lien, pledge, relationship to the parties
privilege, or a similar right or with respect to the
what pertains to that right. particular issue;
2. Goodwill
Disposition of goods – Governed by the law of
questions arising from the principal place of
transactions involving business
movables in transit may be
resolved by law of any place Negotiability or The law governing the rights
having substantial non-negotiability embodied in the instrument
connection with the of an instrument
transaction which will uphold
its validity. The owner is thus Validity of In general, situs of the
permitted to choose between transfer, delivery instrument at the time of
several legal systems: or negotiation of transfer, delivery or
1. Law of the temporary the instrument negotiation
resting place (e.g., interim
port); Effect on a Law of the place of
2. Lex loci actus; corporation of incorporation
3. Law of the place of the sale of
destination; or corporate shares
4. Law of the last real situs of
goods.
 – the court may look into the law of another
FACTUAL
POINT OF CONTACT state which has a real interest in applying its
SITUATION
law;
Effect between Lex loci voluntatis or lex loci
the parties of the intentionis (proper law of the f. The validity of the contract to transfer an
sale of corporate contract) – for this is really a immovable;
shares contract; usually this is the
place where the certificate is g. Negotiable Instruments
delivered. i. Negotiability – law governing the rights
in the instrument
Taxation on the Law of the place of ii. Validity of the transfer, delivery, or
dividends of incorporation negotiation – law of the situs of the
corporate shares instrument at the time of transfer,
delivery, or negotiation;
Taxation on the Law of the place where the
income from the sale was consummated h. Corporate shares;
sale of corporate i. As against the corporation and third
shares persons – law of the place of
incorporation.
Franchises Law of the place that granted ii. As between the assignor and
them assignees – law most closely
connected to the transaction.
Goodwill of the Law of the place where the iii. Taxation on dividends received by
business & business is carried on corporate shares is governed by the
taxation thereto law of the place of incorporation
(SEMPIO-DIY, Conflict, supra at 119).
Patents, In the absence of a treaty,
iv. Sale of corporate shares between
copyrights, they are protected only by
parties – proper law of the contract, i.e.,
trademarks, trade the State that granted them
the lex loci voluntatis or lex loci
names
intentionis, which in many cases, is the
(PARAS, Conflict, supra at 318-322). place where the certificate is delivered
to the buyer.
RULES ON CONVEYANCE OF
PROPERTY i. Franchises – subject to the law of the state
that granted them; and
1. Interpretation and Effect of Conveyance
– Lex situs. j. Intellectual Properties
GENERAL RULE: Patents, copyrights,
2. Extrinsic and Intrinsic Validity of trademarks, trade names, and service
Conveyances marks are protected only by the state that
GENERAL RULE: Lex Situs granted/recognized them.

EXCEPTIONS: EXCEPTION: When a treaty provides

a. Art. 16, par. 2 of the Civil Code; otherwise.

b. Subject matter of contract is land, but issue
pertains to contractual rights and liabilities of
the parties;
c. Security is immovable property but issue is
the validity and effect of the obligation which
the property secures;
d. Under a policy-centered approach, when the
situs of the movable at the time of the
transfer was insignificant or accidental;
e. When the issue involves consideration other
than the validity and effect of the transfer
Trade name, meaning, a corporate name, shall be
protected in all the countries of the Union without the
obligation of filing of registration whether or not it
forms part of the trade name (Union Convention for
the Protection of Industrial Property, Art. 8).
The ownership of a trademark is acquired by its
registration and its actual use by the manufacturer or
distributor of the goods made available to the
purchasing public (UFC Philippines v. Barrio Fiesta
Manufacturing Corp., G.R. No. 198889, January 20,
2016).
Under Sec. 160 of R.A. 8293 (Intellectual Property
Code, hereinafter IPC), a foreign corporation, even
if it is not engaged in business in the Philippines,
may bring a civil or administrative action for
opposition, cancellation, infringement or unfair
competition. Sec. 156 of the same Act also provides
that only owners of registered marks may recover
damages from any person who infringes their rights
(SEMPIO-DIY, Conflict, supra at 121).
PARIS CONVENTION FOR THE
PROTECTION OF INDUSTRIAL
PROPERTY (PHILIPPINES IS A MEMBER
COUNTRY)
Nationals of member countries shall be entitled to:
1. Rights provided by the Paris Convention in the
Philippines which are consistent with Philippine
Laws; and
2. Enjoy the privileges that Philippine laws grant or
may grant to its nationals (AGPALO, Conflict,
supra at 366).
SOURCE OF RIGHTS OF FOREIGN
NATIONALS
1. Reciprocity
– The law of the alien’s country extends
reciprocal rights to Filipino citizens; and
2. Convention, treaty, or agreement where
the Philippines is also a party.
NOTE: Trademark protection has its source in, and
is subject to the limitations of Philippine law, not the
law of the foreign national’s own country (Id. at 398).
SOURCES OF RIGHT AND LEGAL
REMEDIES FOR TRADEMARKS
1. Prior use in commerce of the mark or trade
name in the Philippines from which grows
property rights thereto (INTELLECTUAL
PROPERTY CODE, Sec. 123.2); and
2. The trademark’s registration with the Intellectual
Property Office (INTELLECTUAL PROPERTY
CODE, Sec. 122).
RIGHTS OF FOREIGN NATIONALS
PERTAINING TO TRADEMARKS
1. Sue in trademark or service mark
enforcement action (INTELLECTUAL
PROPERTY CODE, Sec. 160);
2. Register their marks or trade names
under the same terms and conditions as
those applicable to local applicants or to
base their applications on their home
registrations, or to claim priority rights in
connection with pending foreign
applications;
Grounds for Refusal of Registration
a. Mark constitutes a reproduction of a well-
known mark.
b. Mark is an armorial bearing, flag, etc.
c. Mark infringes rights of others, is devoid of
distinctiveness, or is contrary to public
morals.
Territoriality or Independence of
Registration
The Paris Convention provides that a “mark duly
registered in a country of the Union shall be
regarded as independent of marks registered in
the other countries of the Union, including the
country of origin” (Paris Convention for the
Protection of Industrial Property, Art. 6).
3. File an action for infringement or unfair
competition;
4. Oppose or cancel the registration of an
identical mark or substantially similar to
their own marks or trade names;
NOTE: For the enjoyment of these rights, it is
necessary that foreign nationals submit proof
that their country grants substantially similar
rights and privileges to citizens of the Philippines
and their marks should have been previously
registered in the Intellectual Property Office or
are well-known marks or trade names.
5. Protection in the Philippines against
unfair competition;
6. Right of Priority, subject to certain
conditions;
Right of Priority
Right accorded to an applicant who has
previously filed an application in any of the
member countries. His application filed in the
Philippines is considered as if it were filed on the
date the first application was filed in the country
of origin (AGPALO, Conflict, supra at 391).
7. Assign trademark and protect trade
names;
NOTE: The Paris Convention requires the
protection of trade names even without
registration. Sec. 165 of IPC incorporated this
requirement by protecting trade names even
prior to registration.
8. Right to protect collective marks; and
Collective Marks
Any visible sign designated as such in the
application for registration and capable of
distinguishing the origin or any other common
characteristics, including the quality of goods or
services of different enterprises which use the
sign under the control of the registered owner of
the collective mark (INTELLECTUAL
PROPERTY CODE, Sec. 121.2).
9. Right to protect service marks
Service marks
Any visible sign capable of distinguishing the
services of an enterprise (INTELLECTUAL
PROPERTY CODE, Sec. 121.1).
LEGAL REMEDIES OF FOREIGN
NATIONALS
1. Action for damages and injunction based on
infringement, unfair competition or false
designation, and false description;
2. Petition to oppose and cancel registration; and
3. Petition for seizure of prohibited goods
(INTELLECTUAL PROPERTY CODE, Sec.
160).
RIGHTS PERTAINING TO PATENTS
1. Nationals of member countries enjoy in other
member countries the advantages that their
respective laws grant on nationals;
2. The inventor shall have the right to be mentioned
as such in the patent;
3. The grant of a patent shall not be refused and a
patent shall not be invalidated on the ground that
the sale of the patent product or of the product
obtained by the patented process is subject to
restrictions or limitations resulting from domestic
law;
4. The importation by the patentee into the country
where the patent has been granted of articles
manufactured in any of the countries of the union
shall not entail forfeiture of the patent;
5. Industrial designs shall be protected in all
countries of the Union (AGPALO, Conflict, supra
at 444); and
6. Entitled to file a suit for infringement of a patent.
REQUIREMENTS FOR FOREIGN
PATENTEE’S RIGHT TO FILE AN
INFRINGEMENT SUIT
1. He is a national or is domiciled or has a real and
effective industrial establishment in any of the
member countries of the Paris Convention; and
2. If he is engaged in business in the Philippines,
he must first secure a license to do business as
a prerequisite to filing and maintaining the
infringement suit (Id. at 446).
RIGHTS GUARANTEED BY THE BERNE
CONVENTION FOR COPYRIGHT
HOLDERS
1. Authors shall enjoy in countries of the Union,
other than the country of origin, the rights which
their respective laws do now or hereafter grant
to their nationals, as well as rights specifically
granted by the Berne Convention;
2. The enjoyment and exercise of these rights shall
not be subject to any formality and such
enjoyment and such exercise shall be
independent of the existence of protection in the
country of origin of the work; and
3. Where the author is not a national of the country
of origin of the work for which he is protected
under the Convention, he shall enjoy in that
country the same right as national authors
(BERNE CONVENTION, Art. 5).
CONTRACTS
CONTRACT
From the viewpoint of Conflict of Laws, a discussion
of contracts only includes those which are purely civil
or commercial in nature. It excludes those which
create a status (e.g., marriage) or those transferring
real rights (PARAS, Conflict, supra at 374 and
SEMPIO-DIY, Conflict, supra at 122).
INSTANCES OF FOREIGN ELEMENT IN
CONTRACTS:
1. An alien individual becoming a party to the
contract;
2. Parties choosing a foreign law as their choice of
law; and
3. The places of execution and performance are
different from each other (PE BENITO, Conflict,
supra at 87).
PRIMACY OF CONTRACTUAL
STIPULATIONS
The contracting parties may establish such
stipulations, clauses, terms and conditions as they
may deem convenient, provided they are not
contrary to law, morals, good customs, public order,
or public policy (CIVIL CODE, Art. 1306).
Counter-balancing the principle of autonomy of
contracting parties is the equally general rule that
provisions of applicable law, especially provisions
relating to matters affected with public policy, are
deemed written into the contract. The governing
principle is that parties may not contract away
applicable provisions of law especially peremptory
provisions dealing with matters heavily impressed
with public interest. The law relating to labor and
employment is clearly such an area and parties are
not at liberty to insulate themselves and their
relationships from the impact of labor laws and
regulations by simply contracting with each other
(Pakistan International Airlines Corp. v. Ople, G.R.
No. 61594, September 28, 1990).
NOTE: Even if there is a choice of law stipulated in
the contract, the law of the place of performance will
always find applicability to ensure that local laws
thereof are not violated or public policy infringed by
the execution of the contract (PE BENITO, Conflict,
supra at 87).
Generally, in a conflict-of-laws situation, a court must
determine at the outset the nature of the problem
presented to it for solution, specifically, if it relates to
torts, contracts, property, or some other field, or to a
matter of substance or procedure (Erie Insurance
Exchange v. Heffernan II, Misc. No. 2, June 13,
2007).
EFFECT OF INDETERMINATE
APPLICABILITY OF CHOICE OF LAW
If the parties do not specify the extent of the
applicability of their chosen law, the chosen law will
normally apply to the following concerns:
1. Interpretation;
2. Rights and obligations arising from the contract;
3. Performance and the consequences of non-
performance including the assessment of
damages;
4. Various ways of extinguishing obligations, and
prescription and limitation periods;
5. Validity and the consequences of invalidity of the
contract;
6. Burden of proof and legal presumption; and
7. Pre-contractual obligations (The Hague
Principles on Choice of Law in International
Commercial Contracts, Art. 9).
ELEMENTS TO CONSIDER: (ECI)
1. Formal or Extrinsic Validity;
2. Capacity to enter into contracts; and
3. Intrinsic validity (PARAS, Conflict, supra at 374).
EXTRINSIC VALIDITY
– governed by lex loci celebrationis or lex loci
contractus (CIVIL CODE, Art. 17).
Variations:
1. A contract entered into by the parties in two
different countries by cablegram, telex or fax is
presumed to have been entered in the place
where the offer was made (CIVIL CODE, Art.
1319, par. 2); or
2. If the place of execution was merely casual or
accidental, the law which has the most
significant relationship to the transaction should
be applied.
Rule on Validation
Parties entering into a contract upon equal terms
intend their agreement to be binding under any law
whose application the parties can reasonably be
assumed to have taken into account. Philippine
courts may adopt this in interpreting Article 17 of the
Civil Code, in cases where execution cannot be
localized due to multi-state contracts (SALONGA,
Conflict, supra at 344).
INTRINSIC VALIDITY
– the policy of our law is to give effect to the intention
of the parties (CIVIL CODE, Art. 1306).
Thus, we should apply the proper law of the contract,
i.e., the lex loci voluntatis (the law expressly agreed
upon by the parties) or the lex loci intentionis (the
law impliedly agreed upon by the parties) (SEMPIO-
DIY, supra at 126).
THREE POSSIBLE LAWS THAT MAY
GOVERN INTRINSIC VALIDITY:
1. Lex loci contractus
– Law of the place where the contract is made
or executed
Reason: The parties’ mindsets are usually
focused on the law of the place of execution
when they enter into contracts (PE BENITO,
Conflict, supra at 98).
The rule that lex loci contractus, the law of the
place where the contract is made, governs in this
jurisdiction. Courts of the forum will not enforce
any foreign claim obnoxious to the forum's public
policy. Here in the Philippines, employment
agreements are more than contractual in nature.
The Constitution itself, in Article XIII, Section 3,
guarantees the special protection of workers
(Princess Talent Center Production, Inc. v.
Masagca, G.R. No. 191310, April 11, 2018).
2. Lex loci celebrationis
– Law of the place of performance or
celebration
REASON: Since a contract is to be performed in
a particular place or state, it is proper that the
law of that state govern the relationship of the
parties (PE BENITO, Conflict, supra at 102).
3. State of the Most Significant Debtor may agree to be subject to the
Relationship Rule or the Center of jurisdiction of a specific court(s) in case of
Gravity Doctrine or the Grouping-of- contractual breach (COQUIA, supra at 379).
Contacts Theory
– Law of the place with the most connection to 2. Arbitration Clause
the dispute (Id.). A multistate or multinational contract that
contains an arbitration clause gives rise to the
REASON: Convenience and practicality. issue of whether one of the parties can compel
the other to submit to arbitration.
Factual contacts to consider: (CNPSB)
a. Place of Contracting; In the Philippines, the Civil Code and the
b. Place of Negotiating; Arbitration Law (R.A. 876) embody a clear
c. Place of Performance; legislative policy in favor of settling
d. Situs of the subject matter of the contract; controversies by a method considered more
and expeditious, less expensive, and with greater
e. Parties’ Bomicile, residence, nationality, chance in some cases for substantial justice.
place of incorporation, place of business.
3. Adhesion Contracts
These contacts are evaluated depending on GENERAL RULE: Adhesion contracts are not
their relative importance to the issue at hand entirely prohibited. It is valid in the absence of
(Restatement (Second) of Conflict of Laws, proof of arbitrariness, abuse of power, or gross
Section 188). negligence and if it is fairly and freely agreed
upon, reasonable, and just under the
CAPACITY TO ENTER INTO circumstances. One who agrees to it is free to
reject it entirely; if he adheres, he gives his
CONTRACTS consent.
GENERAL RULE: Capacity to enter into contracts is
determined by the personal laws of the contracting EXCEPTION: When there is an oppressive use
parties, either nationality or domiciliary. of superior bargaining power, a Philippine court
may be justified in refusing to apply the contract
EXCEPTIONS: Contracts involving alienation or or a stipulation on the ground that there is no real
encumbrance of real or personal properties wherein arm’s-length transaction between the
lex situs governs the capacity of the contracting contracting parties.
parties.
4. Special Contracts
In the Philippines, capacity is governed by the
nationality theory pursuant to Art. 15 of the Civil
Code (SEMPIO-DIY, Conflict, supra at 124).
RULES ON SPECIFIC CONTRACTS
FACTUAL POINT OF CONTACT
CHOICE OF LAW ISSUES IN CONFLICTS SITUATIONS
CONTRACT CASES Sales and Barter, Lease of Property, and
Questions on the validity of choice of law regarding Commodatum
venue in litigation, arbitration and contracts with
adhesion clauses. 1. Extrinsic validity 1. Lex situs
2. Capacity of parties 2. Lex situs
1. Choice of Forum Clause 3. Intrinsic validity 3. Lex situs
GENERAL RULE: Stipulation on the venue of
suit for litigation concerning the contract will be Lease of Services and Simple Loan or
given effect. Litigation in forum stipulated takes Mutuum
place only if parties specified the choice of forum
as the only venue. 1. Extrinsic validity 1. Lex loci celebrationis
2. Capacity of parties 2. National law
EXCEPTION: Choice of Forum clause will not 3. Intrinsic validity 3. Lex loci voluntatis or
be given effect when there is fraud or the lex loci
overreaching, and said clause would be intentionis situs
unreasonable and unjust.
Contract of Agency
Cognovit Clause or Confession-of-Judgment 1. Extrinsic validity 1. Lex loci celebrationis
 3. Several laws may be selected, each of which will
FACTUAL POINT OF CONTACT
govern different elements of the transaction.
SITUATIONS
4. If under the selected law, the contract is legal,
2. Capacity of parties to 2. National law of the but in the place of performance, it is illegal, the
be a principal or an parties selected law should prevail and the contract
agent 3. Lex loci voluntatis or should be considered legal.
3. Intrinsic validity lex loci intentionis 5. If the law of the performance can be ascertained,
the substantial and essential validity should still
EXCEPTION TO 1-3: be governed by the proper law of the contract.
Lex situs if agency 6. Choice of law should not be interpreted to oust
deals with conveyance the jurisdiction, which the court has already
or encumbrance of acquired over the parties and the subject matter.
property and the 7. The parties cannot contract away provisions of
property applies law especially peremptory provisions heavily
impressed with public interest.
Pledge, Chattel Mortgage, Real Mortgage, and 8. Cognovit clause (confession of judgment) is
Antichresis valid only if the parties were of equal bargaining
power and the debtor agreed to it voluntarily
1. Extrinsic validity 1. Lex situs (SEMPIO-DIY, Conflict, supra at 126-127).
2. Capacity of parties 2. Lex situs
3. Intrinsic validity 3. Lex situs TRANSPORTATION BY SEA
1. Philippine ports to Foreign ports
NOTE: Invalidity of the
– law of the country of destination (CIVIL CODE,
principal contract
Art. 1753).
results in invalidity of
this accessory.
2. Foreign ports to Philippine ports
Guaranty and suretyship a. Civil Code (primary law);
b. Code of Commerce; and
1. Extrinsic validity 1. Lex loci celebrationis c. Carriage of Goods by Sea Act (AQUINO &
2. Capacity of parties 2. National law HERNANDO, Essentials of Transportation
3. Intrinsic validity 3. Lex loci voluntatis or and Public Utilities Law, (2016), p.39
the lex loci [hereinafter, AQUINO & HERNANDO,
intentionis Transportation Law]).

Same Note as above. INTERNATIONAL AIR

TRANSPORTATION
Contract of Common Carrier of Goods
Warsaw Convention applies to all international
1. Extrinsic validity 1. Fixed situs of the carriage of persons, baggage, or goods performed
2. Capacity of parties carrier (depot or by aircraft for hire on the liability of airline in case of
3. Intrinsic validity resting place) death, injury to passengers, or loss or damage to
4. Liability for loss, 2. Fixed situs of the cargo, but not to carriage of mail and postal
destruction, or carrier packages (WARSAW CONVENTION, Art. 1, 2, 17 &
deterioration of 3. Fixed situs of the 18).
goods in transitu carrier
4. Law of the Recognition of the application of the Warsaw
destination (Art. Convention does not preclude the operation of the
1753, Civil Code). Civil Code and other pertinent laws in the
determination of the extent of the liability of the
(PARAS, Conflict, supra at 370 – 371). common carrier (Philippine Airlines v. CA, G.R. No.
119706, March 14, 1996).
LIMITATION ON CHOICE OF LAW
1. Generally, the parties cannot select a law, which GENERAL RULE: The limit of liability for baggage
has no connection at all with the transaction or lost is $1,000 and for death of passenger is
the parties. $100,000. However, the parties may stipulate a
2. If the law selected should change, it is the new higher limit of liability (Alitalia v. IAC and Pablo, G.R.
law that should be applied except if the change No. 71929, December 4, 1990).
is so revolutionary that it could never have been
contemplated by the parties. EXCEPTION: The carrier is liable for damages
beyond those limited by the Warsaw convention if
there is malice, gross negligence, bad faith, or
improper discrimination by carrier or its agents
(Lopez v. Pan Am, G.R. No. L-22415, March 30,
1966, KLM Royal Dutch Airlines v. CA, G.R. L-
31150, July 22, 1975).
Limits of liability shall not apply if it is proved that
damage resulted from an act or omission of the
carrier or its servants/agents, with intent to cause
damage or done recklessly, with knowledge that
damage would probably result, provided it is proved
that the servant/ agent was acting within the scope
of the employment (WARSAW CONVENTION, Art.
25).
It does not operate as an exclusive enumeration of
instances when a carrier shall be liable for breach of
contract or as an absolute limit of the extent of
liability nor does it regulate or exclude liability for
other breaches of contract by the carrier, misconduct
of its employees, or for some particular or
exceptional type of damage (Lufthansa German
Airlines v. Intermediate Appellate Court, G.R. No.
71238, March 19, 1992).
PERIOD OF RESPONSIBILITY
Includes the time the baggage or goods are in the
charge of the carrier, wherever it may be (WARSAW
CONVENTION, Art. 18).
VENUE OF SUITS AT OPTION OF
PLAINTIFF-PASSENGER
1. Domicile of the carrier;
2. Principal place of business of the carrier;
3. Where the carrier has a place of business
through which the contract was made; or
4. Place of destination (WARSAW CONVENTION,
Art. 28).
ACTION WILL PRESCRIBE IF NOT
BROUGHT WITHIN TWO (2) YEARS
FROM THE:
1. Date of arrival at the destination;
2. Date on which the aircraft ought to have arrived;
or
3. Date on which the transportation stopped
(WARSAW CONVENTION, Art. 29).
NOTE: Method of counting the period of limitation is
determined by the law of the forum or lex fori.
TRANSPORTATION BY SUCCESSIVE
CARRIERS
– a carriage to be performed by several successive
carriers is deemed to be one undivided carriage, if it
has been regarded by the parties as a single
operation, whether it had been agreed upon under
the form of a single contract or of a series of
contracts, and it does not lose its international
character merely because one contract or a series
of contracts is to be performed entirely within a
territory subject to the sovereignty of the same High
Contracting Party (WARSAW CONVENTION, Art.
1).
Each of the carrier who accepts the passengers or
baggage shall be subject to the rules set out in the
convention and shall be deemed as one of the
contracting parties insofar as the contract deals with
that part of the transportation which is performed
under his supervision (WARSAW CONVENTION,
Art. 30).
The passenger or representative can take action
only against the carrier who performed the
transportation during which the accident or delay
occurred, unless by express agreement the first
carrier has assumed the responsibility for the entire
journey (WARSAW CONVENTION, Art. 30).
With regard to baggage or goods, the passenger or
consignor shall have a right of action against the first
carrier, and the passenger or consignee shall have
the right of action against the last carrier. Each may
take an action against the carrier who performed the
transportation during which the loss, damage or
delay took place. These carriers shall be jointly and
severally liable to the passenger, or to the consignor
or consignee (WARSAW CONVENTION, Art. 30).
In cases where the convention does not apply, the
Second Restatement holds that the validity of the
contract of carriage as well as the rights created
thereby are determined, in the absence of an
effective choice of law by the parties, by the local law
of the state from which the passenger departs or the
goods are dispatched, unless with respect to the
particular issue, some other State has a more
significant relationship to the contract and to the
parties.
ENFORCEMENT OF A FOREIGN
CONTRACT CLAIM
Philippine courts may assume jurisdiction as long as
there is jurisdiction over the person of the defendant
as a personal action is involved (SALONGA,
Conflict, supra at 385).
 FACTUAL POINT OF CONTACT
WILLS AND SITUATIONS
ADMINISTRATION OF or lex loci celebrationis
ESTATE (CIVIL CODE, Art. 819)

Made by a Filipino Void because of lex

abroad nationalii (CIVIL CODE,
TWO THEORIES IN DETERMINING THE Art. 819)
PROPER LAW FOR THE Made by an alien in the Lex loci celebrationis,
TRANSMISSION OF SUCCESSIONAL Philippines therefore void even if
RIGHTS: apparently allowed by
1. Unitary or Single System Art. 817 because the
Only one law determines transmission of real prohibition on joint wills
and personal properties, e.g., in countries is a clear expression of
following lex nationalii like the Philippines, our public policy
deceased’s national law governs (CIVIL CODE,
Made by an alien and a Valid as to the alien if
Art. 16); in common law countries or those that
Filipino abroad his national law or law of
follow lex domicilii, the law of deceased’s
his domicile, or the lex
domicile governs.
loci celebrationis allows
it, but void as to the
2. Split or Scission System Filipino, the same being
a. Succession to real property – lex situs against our public policy
b. Succession to personal property – law of the on joint wills (SEMPIO-
domicile of deceased at the time of death DIY, Conflict, supra at
(Adopted by Great Britain and United 143)
States).
Intrinsic Validity of Wills
RULES ON WILLS, SUCCESSION,
AND ADMINISTRATION Including order of Lex nationalii of the
succession, amount of deceased for countries
FACTUAL POINT OF CONTACT successional rights, and that follow the
SITUATIONS intrinsic validity of the nationality theory
provisions of the will regardless of the
Extrinsic Validity of Wills location and nature of
the property (CIVIL
Made by an alien Lex nationalii or lex
CODE, Art. 16 par. 2)
abroad domicilii or Philippine
law (CIVIL CODE, Art.
Lex domicilii at the time
816), or lex loci
of death, in countries
celebrationis (CIVIL
that follow the
CODE, Art. 17, par. 1)
domiciliary theory
Made by a Filipino Lex nationalii or lex loci Note: In case of
abroad celebrationis (CIVIL Conflict between lex
CODE, Art. 815) nationalii and lex
domicilii, case can be
Made by an alien in the Lex nationalii or lex loci treated as renvoi to
Philippines celebrationis (CIVIL apply Philippine law
CODE, Art. 817) even if deceased was
citizen of another
Note: Extrinsic validity is dependent on the country (SEMPIO-DIY,
observance of law in force at the time it is made. Conflict, supra at 107)

Extrinsic Validity of Joint Wills (made in the Capacity to Succeed

same instrument)
Capacity to Succeed Lex nationalii of the
Made by an alien Valid in the Philippines deceased – not that of
abroad if valid according to lex the heir (CIVIL CODE,
nationalii, lex domicilii Art. 1039)
 FACTUAL POINT OF CONTACT FACTUAL POINT OF CONTACT
SITUATIONS SITUATIONS

Probate of wills made abroad Philippines or in some

General Rule: lex fori because other country.
allowance/disallowance of a will is essentially
procedural If revocation takes Philippine laws.
place outside the
If not yet probated Lex fori of the Philippines, by a
abroad Philippines applies as to testator domiciled in the
procedural aspects – Philippines.
that is – the will must be
fully probated here and Revocation done 1. Law of the place
due execution must be outside the Philippines, where the will was
shown by a testator who does made; or
not have his domicile in 2. Law of the place in
If already probated Lex fori of the this country. which the testator
abroad Philippines again had his domicile at
applies as to the the time of
procedural aspects – revocation.
the will must also be
probated here because, Executors and Administrators
as a general rule, a
foreign judgment Where appointed Place of domicile of the
cannot have deceased at time of
extraterritorial effect. death or in case of non-
But instead of proving domiciliary, where
due execution, assets are found.
generally it is enough to
Powers Co-extensive with the
ask for the enforcement
qualifying or the
here of the foreign
appointing court – that
judgment of the probate
is – powers may be
abroad
exercised only within
Note: Wills proved and allowed in a foreign the territorial jurisdiction
country, according to the laws of each country, of the court concerned.
may be allowed, filed, and recorded by the proper
court in the Philippines (RULES OF COURT, Note: These rules also
RULE 77, Sec. 1). apply to principal
domiciliary, or ancillary
The foreigner may dispose after his death of his administrators and
property in the Philippines by testament and is not receivers even in non-
obliged to grant it in the Philippines; You can do it succession cases.
in your own country or in another, but in (PARAS, Conflict, supra at 344 - 345).
accordance with the laws of the country in which it
is granted. Article 635 of the Code of Civil OTHER RULES IN PHILIPPINE
Procedure, respecting the freedom of the testator
to grant his will in any place, provides that the
CONFLICTS LAW
testament that can be legalized in a foreign
country in accordance with the laws of that country INTERPRETATION OF WILLS
can also be legalized in the Philippines (Dalton v. 1. In accordance with the testator's intention;
Giberson, G.R. No. L-4113, June 30, 1952). 2. Verba legis if terms are clear and unambiguous;
3. Interpretation of ambiguous words made in
Revocation of wills accordance with the law which was most
probably in the mind of testator when he used
If revocation takes Philippine laws. those words and with which he is presumed to
place in the Philippines, be most familiar (SEMPIO-DIY, Conflict, supra
whether the testator is at 109);
domiciled in the 4. If the will admits of different interpretations, that
which will make the dispositions operative shall
 be preferred;
5. The interpretation that will give the will the most
favorable construction to accomplish its purpose
shall be made;
6. Every effort should be made to prevent intestacy
in keeping with the policy of respecting the will
of the testator, provided that this can be
ascertained; or
7. The national law of the deceased should apply
since we may reasonably presume that this was
the testator's intent (PARAS, Conflict, supra at
356).
REVOCATION OF WILLS
1. If revocation takes place in the Philippines,
whether the testator is domiciled in the
Philippines or in some other country, it is valid if
in accordance with Philippine laws (PARAS,
Conflict, supra at 356).
2. If revocation takes place outside the Philippines,
by a testator domiciled in the Philippines, it is
valid when it is in accordance with the laws of
the Philippines (Id.).
3. Revocation done outside the Philippines, by a
testator who does not have his domicile in this
country, is valid when it is done according to the:
a. Law of the place where the will was made;
or
b. Law of the place in which the testator had
his domicile at the time of revocation (Id. at
357).
ADMINISTRATION OF ESTATES
Like probate, administration is procedural in nature.
Philippine law and procedure follow the main
principle of territorialism. The law of the domicile
governs distribution but the law of the State
appointing the administrator or executor governs
administration. Administration is governed by the
law where administration takes place, and that is the
law of the country from which the administrator
derives his authority (SEMPIO-DIY, Conflict, supra
at 110).
NOTE: The Administration extends only to the
assets of the decedent found within the state or
country where it was granted. To administer the
property situated in a foreign state, the administrator
must be re-appointed, or a new one named in that
state (Id. at 110).
PRINCIPAL DOMICILIARY
ADMINISTRATION
Administration granted in the country of the
deceased's last domicile.
ANCILLARY ADMINISTRATION
Administration in other countries where the
deceased also left properties.
Ancillary administration is proper, whenever a
person dies, leaving in a country other than that of
his last domicile, property to be administered in the
nature of assets of the deceased liable for his
individual debts or to be distributed among his
heirs (Tayag v. Benguet Consolidated, Inc., G.R.
No. L-23145, November 29, 1968).
REASON: Grant of administration does not ex
proprio vigore have any effect beyond the limits of
the country in which it is granted. Hence, an
administrator appointed in a foreign state has no
authority in the Philippines (Tayag v. Benguet
Consolidated, Inc., G.R. No. L-23145, November
29, 1968).
NOTE: It is a general rule universally recognized
that administration, whether principal or ancillary,
certainly extends to the assets of a decedent found
within the state or country where it was granted,
the corollary being "that an administrator
appointed in one state or country has no power
over property in another state or country" (Tayag
v. Benguet Consolidated, Inc., G.R. No. L-23145,
November 29, 1968).
DISTRIBUTION OF ESTATES
– regulated according to the national law of the
person whose succession is under consideration
(CIVIL CODE, Art. 16 par. 2).
Domiciliary administration of the estate of a
deceased American citizen in the U.S. has no power
over and is not entitled to the possession of the stock
certificates of shares of stock owned by the
deceased in a Philippine corporation, which
certificates must be delivered to the ancillary
administration of the deceased's estate in the
Philippines, to be administered by the latter in the
nature of assets of the deceased liable for his debt
or to be distributed among his heirs (SEMPIO-DIY,
Conflict, supra at 111, Tayag v. Benguet
Consolidated, Inc., G.R. No. L-23145, November 29,
1968).
HOLOGRAPHIC WILLS
Must be entirely written, dated, and signed by the
hand of the testator himself. It is subject to no other
form, and may be made in/out of the Philippines, and
need not be witnessed (CIVIL CODE, Art 810,
SEMPIO-DIY, Conflict, supra at 106).
CONFLICT RULES IF A PERSON DIES
INTESTATE
Civil Law Countries (Philippines)
– lex nationalii
Common Law Countries
– split or scission system, i.e., lex domicilii of the
deceased at the time of death as to personality, and
lex situs as to real property (SEMPIO-DIY, Conflict,
p. 105).
CADUCIARY RIGHTS
Two Theories Adopted by States to Claim
Properties Left by Deceased with No Heirs and
No Will
1. England and Most American States
Said properties become bona vacantia or
ownerless and should revert to the state where
they are situated by escheat (Id. at 111).
2. Some Civil Law Countries (Philippines)
The State is the last heir of a deceased person.
Hence, the State succeeds to the properties left
by the said deceased as an heir (Id. at 111).
TORTS
GENERAL RULE:
Lex loci delicti comissi or law of the place where the
tort was committed will govern (WEBSTER’S NEW
WORLD LAW DICTIONARY, 1st ed., 2006).
Under this presumption, the court applies the
substantive laws of the state where the last event
necessary to make an actor liable for the alleged
wrong takes place (Shaw v. LDC Enterprises, 863
N.E. 2d 424, March 30, 2007).
In one case involving torts, the "connecting factor" or
"point of contact" could be the place or places where
the tortious conduct or lex loci actus occurred.
Philippines could be said as a situs of the tort, the
places where the alleged tortious conduct took
place. That certain acts or parts of the injury
allegedly occurred in another country is of no
moment. For, what is important here is the place
where the over-all harm or the totality of the alleged
injury to the person, reputation, social standing and
human rights of complainant, had lodged (Saudi
Arabian Airlines v. Court of Appeals, G.R. No.
122191, October 8, 1998).
BASIS: Vested rights theory, since the rights of the
parties vested are in the place of injury and nowhere
else (PE BENITO, Conflict, supra at 116).
REASONS:
1. The state where the social disturbance occurred
has the primary duty to redress the wrong and
determine the effects of the injury; and
2. To compensate the victim for the damage or
injury suffered (SEMPIO-DIY, Conflict, supra at
131).
EXCEPTION:
When the place of the tort is an insignificant contact,
the factors that must be evaluated are:
1. The place where the conduct causing the injury
occurred;
2. The residence or place of business of the
parties; and
3. The place where the relationship is centered
(Melton v. Stephens, 13 N.E. 3d 533, July 22,
2014).
CONCEPTS OF PLACE OF
WRONG/LOCUS DELICTIS
Illustration: A was hunting in State X, near the
boundary of State Y. A accidentally shot B, who was
standing in State Y.
1. Common Law Concept
– place where the wrongful act became
effective, e.g., last event necessary to make an
actor liable for an alleged tort occurs. Locus
Delicti is State Y.
REASONS:
a. Without an injury, there is nothing to protect
and there is no necessity for judicial relief
(SEMPIO-DIY, Conflict, supra at 132);
b. Vested rights theory, i.e., if the harm does
not take place then the tort is not completed
(COQUIA, Conflict, supra at 409).
2. Civil Law Rule
– place where the tortuous act began. Locus
Delicti is State X.
Reason: The legality or illegality of one’s act
should be determined by the law of the state
where he is at the time he does the act (Id.).
3. Theory of Dr. Rabel (jurist recognized in
comparative law)
– place where the important and substantial acts
leading to the tortuous act were committed/
place having the most substantial connection
with the wrongful act, e.g., situs of radio station
where libelous broadcast was made is the locus
delicti, even if broadcast is heard in many
places (Id.).
OBLIGATION THEORY
The tortuous act gives rise to an obligation, which is
transitory and follows the person committing the
tortuous act and may be enforced wherever he may
be found (Id.).
MODERN THEORIES IN DETERMINING
LIABILITY FOR TORTS
1. Theory of Most Significant Relationship
(MSR)
An action for tort may be filed in the country that
has the most significant relationship to the
occurrence and the parties and thus, has the
greatest concern with the specific issue of the
case.
Two-step analysis for the significant
relationship inquiry:
a. Courts will continue to evaluate the contacts
with each interested jurisdiction; and
b. Courts will continue to evaluate the interests
and public policies of potentially concerned
jurisdictions (Restatement (Second) of
Conflict of Laws, Section 145).
2. The Interest-Analysis Approach
Considers the relevant concerns that two or
more states may have in the case and their
respective interests in applying their laws to it.
The State which has the more relevant and
weighty interests in the case should be
considered the locus delicti.
3. Caver’s Principle of Preference
A higher standard of conduct and financial
protection given to the injured party by one State
is applied by the State where the injury
happened, if the latter State adopts a lower
standard of conduct and financial protection to
the injured (SEMPIO-DIY, Conflict, supra at 132-
134).
4. German Rule or Elective Concurrence
The injured person may choose to sue either
under the law of:
a. The place where the actor engages in his
tortuous conducts; or
b. The place where the effects of his conduct
occur.
NOTE: He cannot cumulate the benefits flowing
from more than one law.
COMPARATIVE IMPAIRMENT TEST
Also known as the governmental interest test, it
determines the impairment of policy resulting from
the non-application of the laws of a State and then
compares the impairment to determine who stands
to lose more. The jurisdiction that loses more is the
jurisdiction that can be said to have the greatest
interest (AQUINO, Elements of Conflict, supra at
295).
It is a three-tiered approach that involves an
examination of whether there is a difference in the
law of the jurisdictions involved, whether there is a
true Conflict of Law, and if a true Conflict exists, the
court will apply the law of the state whose interests
is more impaired (PE BENITO, Conflict, supra at
119).
STEPS IN COMPARATIVE IMPAIRMENT
TEST:
1. The court determines whether the relevant law
of the affected jurisdictions with regard to the
issue in question is the same or different.
2. If there is a difference, the court examines each
jurisdiction’s interest in the application of its own
law to determine whether a true Conflict exists.
3. If the court finds that there is a true Conflict, it
carefully evaluates and compares the nature
and strength of the interest of each jurisdiction
to determine which state’s interest would be
more impaired if its policy were subordinated to
the policy of the other state (Id. at 68).
CHOICE-INFLUENCING
CONSIDERATIONS APPROACH
To determine the applicable law, the following
factors are considered:
1. Predictability of result;
2. Maintenance of the interstate and international
order;
3. Simplification of the judicial task;
4. Advancement of the forum’s governmental
interest; and
5. Application of the better rule of law (Dowis et al.
v. Mud Slingers, 279 Ga. 808, October 24, 2005)
KILBERG DOCTRINE
Where a wrongful death occurred in A state and the
action for damages is brought in B state, B is not
bound by A’s laws on any limitation of liability arising
from the death where the set limitations on damages
are procedural. The law of the forum (B) should be
applied (Kilberg v. Northeast Airlines, Inc., 9 N.Y.2d
34, 211 N.Y.S.2d, 133, 172 N.E.2d 526).
LEX LOCI DELICTI COMMISSII ON
MARITIME TORTS
1. Law of the flag
– torts committed aboard a public vessel,
whether on the high seas or in foreign territorial
waters;
2. Law of the registry
– torts committed aboard a private or merchant
vessel on the high seas; and when two vessels
from the same state collide;
3. Identical Law
– applied if the vessels come from different
states with identical laws; and
4. General maritime law as understood and
applied by the forum where the case is
filed
– vessels come from different states with
different laws (SEMPIO-DIY, Conflict, supra at
134-135).
ENFORCEMENT OF CLAIM FOR
FOREIGN TORT
An action for a foreign tort may be brought in any
place where the tortfeasor may be found so that he
can be subjected to the jurisdiction of the Court
(SALONGA, Conflict, supra at 424).
The officials may be held liable for damages in a tort
suit filed against them in the United States for acts
of torture committed against political detainees or
prisoners in the Philippines in violation of
international and municipal law (In re Estate of
Ferdinand Marcos, Human Rights Litigation,
Maximo Hilao, et.al., Class Plaintiff No. 92-15526,
U.S. Court of Appeals for the 9th Circuit; June 16,
1994).
CONDITIONS FOR THE ENFORCEMENT
OF TORT CLAIMS
1. The foreign tort is based on a civil action and not
on a crime;
2. The enforcement of the tort would not infringe
the public policy of the forum; and
3. The judicial machinery of the forum is adequate
for its proper enforcement (SEMPIO-DIY,
Conflict, supra at 135).
NOTE: While all procedural matters are governed by
the lex fori, all substantive matters are governed by
lex loci delicti commissii (Id. at 135).
ALIEN TORT CLAIMS ACT OF THE
UNITED STATES
Grants US district courts original jurisdiction over
any civil action filed by an alien for a tort committed
in violation of law of nations/treaty of the United
States. Applying said act, the US Court of Appeals
upheld a Hawaiian district court’s jurisdiction over a
class action for damages brought by thousands of
Filipino victims of human rights and torture allegedly
committed by the late President Marcos and his
officials (Trajano v. Marcos-Manotoc, 125 L. Ed. 2d
661, 113 S. Ct. 2959).
CRIMES
RULE OF GENERALITY IN CRIMINAL
LAW
Penal laws and those of public security shall be
obligatory upon all who live or sojourn in the
Philippine territory subject to the principles of Public
International Law and to treaty stipulations (CIVIL
CODE, Art. 14).
GENERAL RULE: Lex loci delicti or the law of the
place where the crime was committed will govern.
EXCEPTIONS:
1. Theory of State Immunity
– Crimes committed by heads of state/ state
officials, diplomatic representatives, and
administrative officers attached to the diplomat
or attaché and officials of recognized
international organizations (CONST. Art. XVI,
Sec. 3).
2. French Rule
– Crimes committed on board a foreign vessel
even if within the territorial waters of the coastal
state, as long as the effect of such crime does
not affect the peace and order of the coastal
state. This is based on the Nationality Theory
(SEMPIO-DIY, Conflict, supra at 141).
NOTE: The Philippines adopts the English Rule,
pursuant to the Territorial Theory. The territory
where the crime was committed will have
jurisdiction except on matters: (1) in relation to
the internal order and discipline of the vessel;
and (2) solely affecting the ship and its
occupants such as minor or petty criminal
offenses committed by members of the crew (Id.
at 141).
3. Extraterritoriality
– Crimes punishable under the local law,
although committed by Philippine nationals
abroad, pursuant to the protective principle of
criminal jurisdiction (REVISED PENAL CODE,
Art. 2).
THEORIES ON JURISDICTION TO TRY
CRIMINAL CASES/THEORIES ON
EXTRATERRITORIAL COMPETENCE
1. Territorial theory
– The State where the crime was committed has
jurisdiction to try the case (PARAS, Conflict,
supra at 403).
 Two kinds:
FACTUAL POINT OF CONTACT
a. Subjective Territorial Principle – the state
SITUATIONS
where the crime began may prosecute the
same even though the crime was completed pursuant to the
in another state (Id. at 404). Protective Theory.
b. Objective Territorial Principle – The state
can prosecute crimes that began abroad but The Locus Delicti of Certain Crimes
were completed within its territory (Id.).
Offense Committed Locus Delicti
2. Nationality or Personal Theory/Active
Nationality Theory Frustrated and Where the victim was
– The country of which the criminal is a citizen consummated homicide, injured (not where the
or a subject has jurisdiction to try him for the murder, infanticide, and aggressor wielded the
offense he is supposed to have committed, parricide weapon)
whether the effectuation of the act be inside or Attempted homicide, Where the intended
outside its territory, provided that the act is a
murder, infanticide, and victim was (not where
crime under his country’s penal law (Id.).
parricide the aggressor was
situated) – so long as
3. Protective Theory the weapon or the
– Any State whose national interests may be bullet either touched
jeopardized has jurisdiction over criminal him or fell inside the
offenses, even if committed outside its territory, territory where he was
and even if committed by an alien in order that it
may protect itself (Id. at 405). Bigamy Where the illegal
marriage was
4. Real Theory/Eclectic Theory performed
– Any State whose penal code has been
transgressed upon has jurisdiction to bring Theft and robbery Where the property
justice to the perpetrators of the offense, was unlawfully taken
whether the crime was committed inside or from the victim (not the
outside its own territory (Id.). place to which the
criminal went after the
5. Cosmopolitan or University Theory commission of the
– Any State where the criminal is found or which crime)
has custody over him is vested with jurisdiction
to try him for the crime he is alleged to have Estafa or swindling Where the object of the
committed – unless extradition is possible (Id.). through false crime was received
representations (not where the false
representations were
6. Passive Personality Theory/Passive
made)
Nationality Theory
– The state of which the victim is a citizen or Conspiracy to commit Where the conspiracy
subject has jurisdiction (PARAS, Conflict, supra treason, rebellion, or was formed (not where
at 403-406). sedition (Note: other the overt act of treason,
conspiracies are not rebellion, or sedition
RULES ON CRIMES penalized by our laws) was committed
FACTUAL POINT OF CONTACT
Libel Where published or
SITUATIONS
circulated
Essential elements of a Generally, where
Continuing crimes Any place where the
crime and its penalties committed
offense begins, exists,
or continues
NOTE: In the
Philippines, we follow Complex crimes Any place where any of
the Territorial Theory the essential elements
in general; by way of of the crime took place
exception, Art. 2 of the
Revised Penal Code (PARAS, Conflict, supra at 399 – 401).
on Extraterritoriality
 FACTUAL SITUATIONS POINT OF CONTACT
BUSINESS Kind of stocks; transfer of
ASSOCIATIONS stocks to bind the
corporation; issuance,
amount, and legality of
dividends; powers and
RULES ON JURIDICAL PERSONS duties of members,
FACTUAL SITUATIONS POINT OF CONTACT stockholders, and officers

Corporations Validity of corporate acts Law of the place of

and contracts (including incorporation and law of
Existence, legal General Rule: the law ultra-vires acts) the place of performance
character, capacity, of the place of (the act or contract must
powers and liabilities incorporation. be authorized by BOTH
LAWS).
Exceptions:
1. Constitutional and Right to sue and
Statutory amenability to court
Lex fori
Restrictions processes and suits
(CONST. Art. XI). against it
Manner and effect of Law of the place of
For constitutional dissolution incorporation provided
purposes – even if it that the public policy of
is incorporated in the the forum is not
Philippines, it is not mitigated against
deemed a Filipino
corporation and Domicile If not fixed by the law
cannot acquire land, creating or recognizing
exploit our natural the corporation or by any
resources, and other provision – the
operate public domicile is where its
utilities unless 60% legal representation is
of the capital is established or where it
Filipino owned exercises its principal
(CONST. Art. XII, functions (CIVIL CODE,
Sec. 2, 10, and 11). Art. 51).
Receivers (appointment Principal receiver is
2. Control Test During and powers) appointed by the courts
Wartime – the veil of of the state of
corporate identity is incorporation; ancillary
pierced and the receivers, by the courts
nationality of the of any state where the
controlling corporation has assets
stockholders is used (authority of receivers is
to determine if a CO-EXTENSIVE with
corporation is an the authority if the
enemy corporation or appointing court).
not (the Control
Test) (Davis Winship Partnership
v. Phil. Trust Co., L-
The existence or non- The personal law of the
3869, January 31,
existence of legal partnership – that is –
1952).
personality of the firm; the law of the place
Alteration of Charter Law of the place of capacity to contract; where it was created.
incorporation. liability of the firm and the (CODE OF
Internal Organization partners to third persons COMMERCE, Art. 15).
Merger and Consolidation Subject, however, to the
exceptions given above
Formation of the as in the case of
corporation (requisites); corporations.
 FACTUAL SITUATIONS POINT OF CONTACT power of restriction and supervision is the fact of
transacting or doing business in the Philippines (Id.).
Creation of branches in Philippine Law (law of
the Philippines; validity the place where the CORPORATION/PARTNERSHIP
and effect of branches' branches were created)
THEORIES ON THE PERSONAL OR
commercial transaction; (CODE OF
and the jurisdiction of COMMERCE, Art. 15). GOVERNING LAW OF A CORPORATION
courts 1. Law of the place of incorporation
– Law adopted by the Philippines;
Dissolution, winding up, Philippine law (CODE
and termination of OF COMMERCE, Art. 2. Law of the place or center of management or
branches in the 15). Central Office Principle/Centre of administration
Philippines or siège social; and
Domicile The place where their
legal representation is 3. Place of Exploitation/exploitation centre or siège
established or where d'exploitation (PARAS, Conflict, supra at 420
they exercise their and 421).
principal functions.
DOMICILE OR RESIDENCE OF FOREIGN
Receivers Philippine law insofar as
the assets in the
CORPORATIONS
Philippines are When not fixed by the law creating them, it shall be
concerned (authority of understood to be the place where their legal
such receivers can be representation is or where they exercise their
exercised as such only principal functions (SEMPIO-DIY, Conflict, supra at
in the Philippines. 143).

Foundations The same principle is recognized in American law:

Foundations (combination Personal law of the that the residence of a corporation, if it can be said
of capital independent of foundation (place of the to have a residence, is necessarily where it
individuals, usually not for principal center of exercises corporate functions; that it is considered
profit) administration). as dwelling in the place where its business is done;
as being located where its franchises are exercised;
(PARAS, Conflict, supra at 416 – 419). and as being present where it is engaged in the
prosecution of the corporate enterprises; that a
EFFECT OF RECOGNITION OF foreign corporation licensed to do business in
FOREIGN BUSINESS ASSOCIATION a state is a resident of any country where it
Merely admits or affirms its legal existence created maintains an office or agent for transaction of its
under the law of one State but does not involve the usual and customary business for venue purposes
rights of the corporation “to do” or “transact (State Investment House, Inc. v. Citibank, N.A., G.R.
business”. Nos. 79926-27, October 17, 1991).

NOTE: A foreign corporation granted license to

THEORIES OF RECOGNITION
1. Territorial Theory
– a company has no legal existence beyond its
sovereignty by which it was created;
2. International Theory
– a foreign corporation is immediately
recognized without further formality; and
3. Restricted Admission Theory
– a State imposes comprehensive examination,
supervision, and control of foreign corporations
(SALONGA, Conflict, supra at 458).
The principle recognized in the Philippines is that
every State may impose conditions on the exercise
by foreign corporations of activities within its
territory. The minimum contract required for the
operate in the Philippines acquires domicile therein
(COQUIA, Conflict, supra at 456).
VALIDITY OF CORPORATE ACTS AND
CONTRACTS
To be valid and binding, corporate acts or contracts
must be authorized both by:
1. The law of the place of incorporation; and
2. The law of the place of performance.
Otherwise, their validity is doubtful and they may not
be given effect, without prejudice to the principle of
estoppel (SEMPIO-DIY, Conflict, supra at 146).
MULTINATIONAL OR TRANSNATIONAL
CORPORATIONS
Branches of a big mother corporation that have been
incorporated under the local law of each country or
state where it has extended its business are
separate entities governed by the said local laws (Id.
at 148).
JURISDICTION OVER FOREIGN
CORPORATIONS
CONSENT DOCTRINE
A foreign corporation will be recognized and will be
allowed to transact business in any state which gives
its consent. This doctrine is established in Secs.
140-153, Title XV of the Revised Corporation Code
of the Philippines.
NOTE: A foreign corporation lawfully doing business
in the Philippines shall be bound by all laws, rules
and regulations applicable to domestic corporations
of the same class, except those which provide for the
creation, formation, organization or dissolution of
corporations or those which fix the relations,
liabilities, responsibilities, or duties of stockholders,
members, or officers of corporations to each other or
to the corporation (CORPORATION CODE OF THE
PHILIPPINES, Sec. 146).
A foreign corporation may be sued after it withdrew
from business in the Philippines on contracts
previously entered into by it. The same rule applies
to contracts entered into prior to the revocation of a
foreign corporation’s license (SEMPIO-DIY, Conflict,
supra at 148).
PARENT AND SUBSIDIARY
CORPORATIONS
Jurisdiction over the parent corporation can be
acquired when the separate existence of the
subsidiary has not been fully maintained or if the
parent has acted within the state as the subsidiary’s
agent (COQUIA, Conflict, supra at 524).
However, if the local counterpart is a subsidiary with
an entirely distinct personality, jurisdiction over the
local counterpart is not jurisdiction over the parent
company (Id.).
RIGHT OF A FOREIGN CORPORATION
TO BRING SUIT
GENERAL RULE:
No foreign corporation transacting business in the
Philippines without a license, or its successors or
assigns, shall be permitted to maintain or intervene
in any action, suit or proceeding in any court or
administrative agency of the Philippines; but such
corporation may be sued or proceeded against
before Philippine courts or administrative tribunals
on any valid cause of action recognized under
Philippine laws (REVISED CORPORATION CODE
OF THE PHILIPPINES, Sec. 150).
EXCEPTIONS:
1. Isolated transactions (Lorenzo Shipping Corp. v.
Chubb and Sons, Inc., G.R. No. 147724, June 8,
2004);
2. Action to protect trademark, trade name,
goodwill, patent or for unfair competition;
3. To enforce a right not arising out of a business
transaction, e.g., tort that occurred in the
Philippines;
4. When the parties have contractually stipulated
that the Philippines is the venue of actions;
5. When the party sued is barred by the principle of
estoppel and/or principle of unjust enrichment
from questioning the capacity of the foreign
corporation;
6. Recovery of misdelivered property (DE LEON &
DE LEON Jr., CORPORATION CODE (2013)
supra at 798-801);
7. Agreements or transactions fully transacted
outside the Philippines (B. Van Zuiden v. GTVL
Manufacturing Industries Inc., G.R. No. 147905,
May 28, 2007); and
8. Petition filed is merely a corollary defense in a
suit against it.
EFFECT OF FAILURE TO SECURE A
LICENSE TO TRANSACT BUSINESS
1. The foreign corporation which does business in
the Philippines without a license has no right to
sue in the Philippines, but it can still be sued
(CORPORATION CODE, Sec. 150); and
2. The contracts entered into are valid as between
the parties, but they may not be enforced in the
Philippine courts (COQUIA, Conflict, supra at
517).
FOREIGN CORPORATIONS AND
COMPULSORY COUNTERCLAIMS
1. When a foreign corporation is sued, it may
interpose a counterclaim which would defeat the
complaint.
2. If the foreign corporation is suing on an isolated
contract or is exempt from the license
requirement, a local defendant can file a
counterclaim.
NOTE: In either case, the foreign corporation is not
maintaining a suit. Further, such counterclaim may
embrace only compulsory counterclaim, not a
permissive one, for the former is deemed waived if
not raised (AGPALO, Conflict, supra at 475).
TRUSTS REQUISITES FOR RECOGNITION OR
When the trust contains an express choice-of-law ENFORCEMENT: (NOPD-BAFC-FCM-C)
provision, that law shall apply. In the absence of an 1. The defendant has been given reasonable
express provision, the courts will deem as controlling Notice and Opportunity to be heard;
the law that will sustain the validity of the trust. 2. There is adequate Proof of foreign judgment;
3. The foreign judgment must have Disposed of the
RECOGNITION AND ENFORCEMENT controversy on the merits and must be res
OF FOREIGN JUDGMENTS, judicata, i.e., judgment on the merits is final,
DISTINGUISHED issued by a foreign court having jurisdiction over
the subject matter and parties, and there was
RECOGNITION OF ENFORCEMENT OF identity of parties, subject matter, and cause of
FOREIGN JUDGMENT FOREIGN JUDGMENT action
4. It must not be Barred by prescription both in the
The defendant or The plaintiff or petitioner State where it was promulgated and where it is
respondent is wants the court to sought to be enforced;
presenting the foreign positively carry out and 5. State where the foreign judgment was obtained
judgment merely as a make effective the Allows recognition or enforcement of Philippine
defense, on the basis of foreign judgment. judgments;
res judicata. 6. If judgment is for a sum of money, it must be
Fixed;
Invokes merely a sense Implies an act of
7. Foreign judgment must not be Contrary to the
of justice (Perkins v. sovereignty.
public policy or good morals of the country
Benguet Consolidated
where it is to be enforced;
Mining, G.R. No. L-
8. Judgment must not have been obtained by
1981, May 28, 1954).
Fraud, Collusion, Mistake of fact or law; and
Needs no proceeding or Requires a separate 9. It must be a judgment on Civil or commercial
action but implies that action brought precisely matters, including questions of status, not on a
the same has already to make the foreign criminal, revenue, or administrative matter.
been filed against the judgment effective.
defendant who is PHILIPPINE RULE ON THE EFFECT OF
invoking the foreign FOREIGN JUDGMENT
judgment. The effect of a judgment or final order of a tribunal of
a foreign country, having jurisdiction to render the
Recognition is a Enforcement is an judgment or final order, is as follows:
passive effect of foreign active recognition and 1. In a judgment or final order upon a specific
judgment. implementation of the thing, the judgment or final order is conclusive
foreign judgment from upon the title to the thing; and
the local court, 2. In a judgment or final order against a person,
rendering the foreign the judgment or final order is presumptive
judgment as a domestic evidence of a right as between the parties and
judgment and seeking their successors in interest by a subsequent title.
its enforcement by the
sheriff in accordance In either case, the judgment or final order may be
with the Rules of Court. repelled by evidence of a want of jurisdiction, want
(SEMPIO-DIY, Conflict, supra at 151-152). of notice to the party, collusion, fraud, or clear
mistake of law or fact (RULES OF COURT, Rule 39,
NOTE: Enforcement necessarily implies recognition; Sec. 48).
recognition does not necessarily imply enforcement.
NOTE: The judgment in the foreign court does not
constitute res judicata as basis for its enforcement
EXAMPLES OF FOREIGN JUDGMENTS
without giving the losing party the opportunity to
WHICH CAN ONLY BE RECOGNIZED: dispute it (AGPALO, Conflict, supra at 586).
1. Declaratory judgments;
2. Judgments which give no affirmative relief; and THREE MODES OF ENFORCEMENT OF
3. Judgments which determine the parties’
interests in a thing or status.
JUDGMENT:
1. By filing a petition in the court where the
judgment is sought to be recognized for the
recognition of the judgment;
2. By a summary procedure known as exequatur
proceedings (a summary procedure outlined in
the statutes of some civil law countries such as
France, Italy, Switzerland, and Austria for the
enforcement of foreign judgments that have no
automatic effect or authority in themselves); and
3. By registration of the foreign judgment in a
registry of judgments in the forum where it is with
or without judicial supervision (COQUIA,
Conflict, supra at 561-563).

REASONS FOR REFUSAL BY A LOCAL

COURT TO RECOGNIZE OR ENFORCE A
FOREIGN JUDGMENT:
1. The requisite proof of the foreign judgment may
not have been presented (Note: The manner of
proving a foreign judgment is the same as
proving a foreign law (RULES OF COURT, Rule
132, Sec. 25).
2. The foreign judgment may contravene a
recognized and established policy in our
country, e.g., foreign decree of divorce obtained
by a Filipino from his/her Filipino spouse abroad;
or
3. The administration of justice in the country
where the foreign judgment came from may be
shockingly corrupt or not beyond reproach.

PROCEDURE OF ENFORCEMENT OF
JUDGMENT IN THE PHILIPPINES:
1. Filing of petition in the proper court attaching an
authenticated copy of the foreign judgment; and
2. Authentication calls for the Philippine consul
assigned to the country where the foreign
judgment was decreed to certify that such
judgment was rendered by a court of competent
jurisdiction (COQUIA, Conflict, supra at 561).

FOREIGN JUDGMENT MUST CONFORM

WITH THE CONSTITUTIONAL
REQUIREMENTS
The requirement that a judgment must state the facts
and the law upon which it is based is embodied in
Section 14 of Article VIII of the Constitution. Any
foreign law, whether substantive or procedural,
cannot overrule or prevail over this constitutional
provision (AGPALO, Conflict, supra at 644).
 2. Takes effect immediately
EFFECT AND – It shall take effect immediately after publication
with the 15-day period being dispensed with
APPLICATION OF LAWS (Tañada v. Tuvera,supra).

3. No provision as to its effectivity

– It takes effect after 15 days following its
The Civil Code took effect on August 30, 1950.
publication (CIVIL CODE, Art. 2; 1 PARAS, Civil
Code of the Philippines Annotated (2016), p. 14
[hereinafter 1 PARAS]).
EFFECTIVITY OF LAWS NOTE: If the law declares that it shall be effective
(ART. 2) “15 days after its publication”, it means that its
effectivity is on the 15th day after such publication.

If the law declares that it shall be effective “after 15

GENERAL RULE: Laws shall take effect after 15
days following the completion of their publication in
the Official Gazette, or in a newspaper of general
circulation in the Philippines (CIVIL CODE, Art. 2 as
amended by E.O. No. 200 (1987)).
No one shall be charged with notice of the statute’s
provision until publication is completed and the 15-
day period has expired (Nagkakaisang Maralita ng
Sitio Masigasig Inc. v. Military Shrine Service, G.R.
No. 187587, June 5, 2013).
EXCEPTION: Unless otherwise provided by the
law (CIVIL CODE, Art. 2).
NOTE: The date of effectivity of Municipal
Ordinances is NOT covered by this rule but by the
Local Government Code (Tañada v. Tuvera, G.R.
No. L-63915 April 24, 1985).
RULES ON PERIOD PROVIDED BY
STATUTE:
1. Shorter/longer period than the 15-day
period
– the period provided in the statute shall prevail
(STA. MARIA, Persons and Family Relations
Law (2015), p. 4) [hereinafter STA. MARIA]].
days following its publication,” its effectivity is on the
16th day thereafter (RABUYA, The Law on Persons
and Family Relations (2017), p. 4-5 [hereinafter
RABUYA]).
INDISPENSABILITY OF PUBLICATION
The clause “unless it is otherwise provided” in Art. 2
solely refers to the 15-day period and not to the
requirement of publication. Publication is an
indispensable requisite; the absence of which will
violate due process as it would deny the public
knowledge of the laws that are supposed to govern
it (Nagkakaisang Maralita ng Sitio Masigasig Inc v.
Military Shrine Services, G.R. No. 187587, June 5,
2013).
COVERAGE: (PLAC3E)
1. Presidential Decrees;
2. Laws which refer to all statutes, including local
and private laws;
3. Administrative rules and regulations, the
purpose of which is to enforce/implement
existing laws pursuant to a valid delegation;
4. Charter of a city;
5. Circulars issued by the Monetary Board, the
purpose of which is not merely to interpret but
to fill in the details of the Central Bank Act;

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA TAMPUS, Vice Chairperson
for Secretariat | ARVY KEITH CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice Chairperson for
Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Dean MARCIANO G. DELSON, Dean ULPIANO P. SARMIENTO III, and Atty. FRANCESCA LOURDES M. SEÑGA
6. Circulars and regulations which prescribe a
penalty for their violation (People v. Que Po Lay,
G.R. No. L-6791, March 29, 1954); and
7. Executive Orders (Tañada v. Tuvera, supra).
PUBLICATION NOT REQUIRED: (SILI)
1. Supreme Court decisions (De Roy v. CA, G.R.
No. 80718, January 29, 1988);
2. Interpretative regulations (Securities
and Exchange Commission v. GMA Network,
Inc.,G.R. No. 164026. December 23, 2008);
3. Letters of Instructions issued by administrative
superiors on rules/guidelines to be followed by
subordinates in the performance of their duties
(National Power Corp. v. Pinatubo Commercial,
G.R. No. 176006, March 26, 2010); and
4. Those Internal in nature, regulating only the
personnel of the administrative agency (Tañada
v. Tuvera, supra).
NOTE: Administrative rules and regulations must
also be published if their purpose is to enforce or
implement existing law pursuant also to a valid
delegation (Manila Public School Teachers'
Association v. Garcia, G.R. No. 192708, October 2,
2017).
NEWSPAPER OF GENERAL
CIRCULATION
To be a newspaper of general circulation, it is
enough that it is published for the dissemination of
local news and general information; that it has a
bona fide subscription list of paying subscribers: that
it is published at regular intervals (Fortune Motors
Phils. Inc. v. Metropolitan Bank and Trust Company,
G.R. No. 115068, November 28,1996).
The term “newspaper of general circulation” does
not mean that it is a newspaper with the largest
circulation. The fact that there are other newspapers
having larger circulation is unimportant (Basa v.
Mercado, G.R. No. L-42226, July 26, 1935).
IGNORANCE OF THE
LAW EXCUSES NO ONE
(ART. 3)
IGNORANTIA LEGIS NON EXCUSAT
“Ignorance of the law excuses no one.” A mistake of
law cannot be utilized as a lawful justification,
because everyone is presumed to know the law and
its consequences (In Re: Petition to Sign in the Roll
of Attorneys, B.M. No. 2540, September 24, 2013).
It is founded not only on expediency and policy but
also on necessity (Zulueta v. Zulueta, G.R. No. 428,
April 30, 1902).
CONCLUSIVE PRESUMPTION
Every person is presumed to know the law even if he
has no actual knowledge of the law (Tañada v.
Tuvera, supra).
NOTE: It applies only to mandatory and prohibitory
laws. This may be deduced from the language of the
provision, which, notwithstanding a person’s
ignorance, does not excuse his or her
compliance with the laws (D.M. Consunji, Inc. v. CA,
G.R. No. 137873, April 20, 2001).
This applies to all kinds of domestic laws, whether
civil or penal (Luna v. Linatoc, G.R. No. L-22378,
June 29, 1968), and whether substantive or remedial
(Zulueta v. Zulueta, supra).
FOREIGN LAW NOT INCLUDED
The presumption does not apply to foreign laws
because there is no judicial notice of such foreign
laws; such laws must be proved like any other matter
of fact. (Ching Huat v. Co Heong, G.R. No. L-1211,
January 30, 1947).
JUDICIAL NOTICE
Refers to the act of the court in taking cognizance of
matters as true or as existing without the need of the
introduction of evidence, or the authority of the court
to accept certain matters as facts even if no
evidence of their existence has been presented.
DOCTRINE OF PROCESSUAL
PRESUMPTION
Where a foreign law is not pleaded or, even if
pleaded, is not proved, the presumption is that the
foreign law is the same as ours (EDI-Staffbuilders
Int’l. Inc. v. NLRC, G.R. No. 145587, October 26,
2007; Industrial Personnel & Management Services,
Inc. v. De Vera, G.R. No. 205703, March 7, 2016).
MISTAKE IN THE APPLICATION OR
INTERPRETATION OF DIFFICULT OR
DOUBTFUL PROVISIONS OF LAW
A mistake in the application or interpretation of
difficult or doubtful provisions of law may be the
basis of good faith and has been given the same
effect as a mistake of fact, which may excuse one
from the legal consequences of his conduct (CIVIL
CODE, Art. 526, par. 3 and Art. 2155).
 NON-RETROACTIVITY
OF LAWS (ART. 4)
RETROACTIVE LAW
It is one intended to affect transactions which
occurred, or rights which accrued, before it becomes
operative, and which ascribes to them effects not
inherent in their nature, in view of the law in force at
the time of their occurrence (RABUYA, supra at 12).
GENERAL RULE: Laws shall have no retroactive
effect (CIVIL CODE, Art. 4).
RATIONALE: Statutes, including administrative
rules and regulations, operate prospectively unless
the legislative intent to the contrary is manifest by
express terms or by necessary implication because
the retroactive application of a law usually divests
rights that have already become vested. This is
based on the Latin maxim: Lex prospicit non respicit
(the law looks forward, not backward) (Lintag v.
NAPOCOR, G.R. No. 158609, Julay 27, 2007).
EXCEPTIONS: (P2UT-NICE)
1. Procedural or remedial laws (Araneta v.
Doronila, G.R. No. L-34882, August 24, 1976);
2. Penal laws favorable to the accused; provided
that the accused is not a habitual delinquent
(REVISED PENAL CODE, Art. 22; People v.
Quiachon, G.R. No. 170236, August 31, 2006);
3. Unless the law otherwise provides;
4. Tax laws when expressly declared or is clearly
the legislative intent (Cebu Portland Cement v.
CIR, G.R. No. L-18649, February 27, 1965);
5. Laws creating New rights (Bustamante v.
Cayas, G.R. Nos. L-8562, December 17, 1955);
6. Interpretative statutes (BPI Leasing Corp. v. CA,
G.R. No. 127629, November 18, 2003);
7. Curative or remedial statutes (People v. Zeta,
G.R. No. L-7140, December 22, 1955); and
8. Emergency laws (Santos v. Alvarez, G.R. No. L-
332, June 18, 1947).
EXCEPTIONS TO THE EXCEPTIONS: (EL)
1. Ex Post Facto Laws; and
2. Laws that impair obligation of contracts (Asiatic
Petroleum Co. (P.I.), Ltd. v. Llanes, G.R. No.
25386, October 20, 1926).
ACTS CONTRARY TO
LAW (ART. 5)
GENERAL RULE:
Acts contrary to mandatory or prohibitory laws are
void (CIVIL CODE, Art. 5).
MANDATORY OR POSITIVE LAWS
Laws the violation of which, tenders the act or
proceeding illegal and void (1 TOLENTINO,
Commentaries and Jurisprudence on the Civil Code
of the Philippines (1990), p. 26 [hereinafter 1
TOLENTINO]). If the law demands something to be
done, it is mandatory (RABUYA, supra at 19).
PROHIBITORY OR NEGATIVE LAWS
Laws which, if omitted, renders the proceeding or
acts relating to it generally illegal or void. The law
commands that something should not be done (In re
Brehm v. Republic, G.R. No. L-18566, September
30, 1963.).
EXCEPTIONS: (PAVE)
1. The law makes the act valid but Punishes the
violator (e.g. Marriage solemnized by a person
without legal authority);
2. The law itself Authorizes its validity (e.g., Lotto,
sweepstakes);
3. The law makes the act only Voidable (e.g.,
Voidable contracts where consent is vitiated);
and
4. The law declares the nullity of an act but
recognizes its Effects as legally existing (e.g.,
Child born after annulment of marriage is
considered legitimate) (1 PARAS, supra at 36).
WAIVER OF RIGHTS
(ART. 6)
WAIVER
It is the intentional relinquishment of a known right
or such conduct as warrants an inference of
relinquishment of such right (Christensen v.
Carleton, 69 Vt. 91; Castro v. Del Rosario, G.R. No.
L-17915, January 31, 1967).
NOTE: A waiver to be valid and effective must, in the
first place, be couched in clear and unequivocal
terms which leave no doubt as to the intention of a
party to give up a right or benefit which legally
pertains to him. (Thomson v. Court of Appeals, G. R.
No. 116631, October 28, 1998).
REQUISITES OF A VALID WAIVER:
(CUE–CPF)
1. Full Capacity to make the waiver;
2. Waiver must be Unequivocal;
3. Right must Exist at the time of the waiver;
4. It must not be Contrary to law, public policy,
morals or good customs;
5. It must not be Prejudicial to a third person with a
right recognized by law; and
6. When Formalities are required, the same must
be complied with (1 PARAS, supra at 39).
GENERAL RULE: Rights may be waived (ALBANO,
Family Code of the Philippines (2017), p. 21)
[hereinafter ALBANO].
EXCEPTIONS: (WARN)
Rights that cannot be waived under any of the
following circumstances:
1. When the Waiver is prejudicial to a third person
with a right recognized by law (CIVIL CODE, Art.
6);
2. Alleged rights, which really do not exist yet;
3. Those the Renunciation of which would infringe
upon public policy (CIVIL CODE, Art. 6); and
4. Natural rights, such as the right to life (Id. at 40-
41).
RIGHT
The power or privilege given to one person and, as
a rule, is demandable of another. It denotes an
interest or title in an object or property (Black’s Law
Dictionary, p. 1558).
ELEMENTS OF RIGHTS:
1. Active subject
– one who is entitled to demand enforcement of
the right; and
2. Passive subject
– one who is duty-bound to suffer its enforcement
(RABUYA, supra at 18).
KINDS OF RIGHTS:
1. Political Rights
– those rights referring to the participation of
persons in the government of the State; and
2. Civil Rights
– include all others; they are further classified
into:
a. Rights of personality – cannot be waived;
b. Family rights – cannot be waived; and
c. Patrimonial rights – may be waived (Id. at
18-19).
TYPES OF PATRIMONIAL RIGHTS
1. Real Right (jus in re/ jus in rem)
The power over a specific thing without a passive
subject individually determined against whom such
right may be personally exercised; it is enforceable
against the whole world.
2. Personal Right (jus in personam/ jus ad
rem)
The power belonging to one person to demand of
another, as a definite passive subject, the fulfillment
of a prestation to give, to do or not to do (Id.).
REPEAL OF LAWS
(ART.7)
REPEAL OF A LAW
It is the legislative act of abrogating through a
subsequent law the effects of a previous statute or
portions thereof (STA. MARIA, supra at 11).
TYPES OF REPEAL:
1. Express
– one which is literally declared by a new law,
either in specific terms, as where particular laws
and provisions are named, identified, and
declared to be repealed, or in general terms
(Id.).
2. Implied
– takes place when a new law contains
provisions contrary to or inconsistent with those
of a former law without expressly repealing them
(STA. MARIA, supra at 11).
REQUISITES OF AN IMPLIED REPEAL
1. The laws cover the same subject matter; and
2. The latter is repugnant to the other (Agujetas v.
CA, G.R. No. 106560, August 23, 1996).
NOTE: Implied repeals are not looked upon with
favor (US v. Palacio, G.R. No. 11002, January 17,
1916). If both statutes can stand together, there is
no repeal (Lichauco v. Apostol, G.R. No. 19628,
December 4, 1922). When statutes are in pari
materia, they should be construed together. A law
cannot be deemed repealed unless it is clearly
manifested that the legislature so intended it (Lledo
v. Lledo, A.M. No. P-95-1167 (Resolution),
February 9, 2010).
A repealing clause in an Act which provides that “all
laws and parts thereof inconsistent with the
provisions of this Act are hereby repealed or
modified accordingly” is certainly not an express
repealing clause because it fails to identify or
designate the Act or Acts that are intended to be
repealed. Rather, it is a clause which predicates the
intended repeal upon the condition that substantial
conflict must be found in existing and prior acts (Iloilo
Palay and Corn Planters Association, Inc. v.
Feliciano, G.R No. L-24022, March 3, 1965).
RULE IN CASE OF CONFLICT BETWEEN
A GENERAL LAW AND A SPECIAL LAW
1. If the general law was enacted PRIOR to the
special law, the latter is considered the
exception to the general law (1 PARAS, supra at
47).
2. If the general law was enacted AFTER the
special law, the special law remains, unless:
a. There is an express declaration to the
contrary; or
b. There is a clear, necessary, and
irreconcilable conflict; or
c. The subsequent general law covers the
whole subject and is clearly intended to
replace the special law on the matter (Ibid).
EFFECT IF THE REPEALING LAW IS
ITSELF REPEALED
1. When a law which expressly repeals a prior law
is itself repealed, the law first repealed shall not
be thereby revived, unless expressly so
provided.
Example: Law A is expressly repealed by Law
B. If Law B is itself repealed by Law C, Law A is
not revived, unless Law C expressly so
provides.
2. When a law which impliedly repeals a prior law
is itself repealed, the prior law shall thereby be
revived unless the language of the repealing
statute provides otherwise.
Example: Law A is impliedly repealed by Law
B. Law B is later repealed by Law C. Law A is
revived unless Law C provides otherwise (Id. at
49).
UNCONSTITUTIONAL STATUTES
The Constitution is the supreme, organic, and
fundamental law of the land. It is axiomatic that no
ordinary statute can override a constitutional
provision (Floresca v. Philex Mining Corp., G.R. No.
L-30642, April 30, 1985).
The constitutionality of a law or administrative order
may not be collaterally attacked, and they shall be
deemed valid unless declared null and void by a
competent court (NAWASA v. Reyes, G.R. No. L-
28597, February 29, 1968).
OPERATIVE FACT DOCTRINE
Before an act is declared unconstitutional, it is an
“operative fact” which can be the source of rights and
duties (RABUYA, supra at 26). The actual existence
of a statute, prior to such a determination [of
unconstitutionality], is an operative fact and may
have consequences which cannot justly be ignored.
The past cannot always be erased by a new judicial
declaration (De Agbayani v. PNB, G.R. No. L-
23127, April 29,1971). In short, it nullifies the void
law or executive act but sustains its effects.
Thus, a legislative or executive act, prior to its being
declared as unconstitutional by the courts, is valid
and must be complied with (Chavez v. NHA, G.R.
No. 164527, August 15, 2007).
RULES AND REGULATIONS,
EXECUTIVE AND ADMINISTRATIVE
ACTS
Rules and regulations when promulgated in
pursuance of the procedure or authority conferred
upon the administrative agency by law, partake of
the nature of a sanction provided in the law. These
regulations must be in harmony with the provisions
of the law (STA. MARIA, supra at 13-14).
JUDICIAL DECISIONS
FORM PART OF LEGAL
SYSTEM OR DOCTRINE
OF STARE DECISIS
(ART. 8)
Judicial decisions applying or interpreting the laws or
the Constitution shall form part of the legal system of
the Philippines (CIVIL CODE, Art. 8).
STARE DECISIS ET NON QUIETA
MOVERE
“To adhere to precedents, and not to unsettle things
which are established” (Tala Realty ServicesCorp.,
Inc. v. Banco Filipino Savings & Mortgage Bank,
G.R. No. 181369, June 22, 2016).
DOCTRINE OF STARE DECISIS
When the Supreme Court has once laid down a
principle of law as applicable to a certain state of
facts, it will adhere to that principle, and apply it to all
future cases, where facts are substantially the
same; regardless of whether the parties and
property are the same (Light Rail Transit Authority
v. Pili, G.R. No. 202047, June 8, 2016).
The Doctrine of Stare Decisis is one of policies
grounded on the necessity for securing certainty
and stability of judicial decisions (Tala Realty
Services Corp., Inc. v. Banco Filipino Savings &
Mortgage Bank, supra).
NOTE: The law of the case doctrine has been
defined as the opinion delivered on a former appeal.
It means that whatever is once irrevocably
established as the controlling legal rule or decision
between the same parties in the same case
continues to be the law of the case, whether correct
on general principles or not, so long as the facts on
which such decision was predicated continue to be
the facts of the case before the court. (De La Salle
University v. De La Salle University Employees
Association - NAFTEU, G.R. No. 169254, August 23,
2012).
LEGAL EFFECTS OF JUDICIAL
DECISIONS
1. No publication required (De Roy v. CA, G.R.
No. 80718, January 29, 1988);
2. Conclusive and binding between parties after
the lapse of appeal period (City of Cebu v.
Apolonio M. Dedamo, G.R. No. 172852, January
30, 2013); and
3. Bind all future cases with identical facts, until
reversed by SC (De Mesa v. Pepsi Cola Product
Phils. Inc., G.R. Nos. 153063-70, August 19,
2005 citing Kilosbayan, Inc. et al. v. Morato, G.R.
No. 118910, July 17, 1995).
Judicial decisions, although in themselves are not
laws, constitute evidence of what the laws mean
(People v. Licera, G.R. No. L-39990, July 22, 1975).
The application or interpretation placed by the Court
upon a law is part of the law as of the date of
enactment of said law because the Supreme Court’s
interpretation merely establishes the
contemporaneous legislative intent that the
construed law purports to carry into effect (People
v. Licera, supra).
NOTE: Only the decisions of the Supreme Court
establish jurisprudence or doctrines in this
jurisdiction (Vda. de Miranda v. Imperial, G.R. No. L-
49090, February 28, 1947).
NO RETROACTIVE EFFECT
When a doctrine of the Supreme Court is overruled
and a different view is adopted, the new doctrine
should be applied prospectively and should not
prejudice parties who relied on the old doctrine
(People v. Jabinal, G.R. No. L-30061, February 27,
1974).
HOW JUDICIAL DECISIONS MAY BE
ABROGATED
1. By contrary ruling of the Supreme Court itself;
and
2. By corrective legislative acts of Congress,
although said laws cannot adversely affect those
favored prior to Supreme Court decisions (1
PARAS, supra at 69).
ADMINISTRATIVE DECISIONS
Although it is recognized that judicial decisions
applying or interpreting statutes are part of the legal
system of the country, such level of recognition is not
afforded to administrative decisions (International
Management Services v. Logarta, G.R. No. 163657,
April 18, 2012).
DUTY OF JUDGES
(ART. 9)
No judge or court shall decline to render judgment
by reason of the silence, obscurity or insufficiency of
the laws (CIVIL CODE, Art. 9).
DUTY OF JUDGES
Judges must not evade performance of this
responsibility just because of an apparent non-
existence of any law governing a particular legal
dispute or because the law involved is vague or
inadequate (STA.MARIA, supra at 16).
NOTE: Whenever a court has knowledge of any act
which it may deem proper to repress and which is
not punishable by law, it shall render the proper
decision, and shall report to the Chief Executive,
through the Department of Justice, the reasons
which induce the court to believe that said act should
be made the subject of penal legislation(REVISED
PENAL CODE, Art. 5, par. 1).
In the same way, the court shall submit to the Chief
Executive, through the Department of Justice, such
statement as may be deemed proper, without
suspending the execution of the sentence, when a
strict enforcement of the provisions of the Revised
Penal Code would result in the imposition of a clearly
excessive penalty, taking into consideration the
degree of malice and the injury caused by the
offense (REVISED PENAL CODE, Art. 5, par. 2).
IF THE LAW IS SILENT, OBSCURE, OR
INSUFFICIENT, A JUDGE MAY BASE HIS
JUDGMENT ON ANY OF THE
FOLLOWING: (CD-OSP)
1. Customs which are not contrary to law, public
order, or public policy (CIVIL CODE, Art. 11);
2. Decisions of foreign and local courts on similar
cases;
3. Opinions of highly qualified writers
and professors;
4. Rules of Statutory construction; and
5. Principles laid down in analogous instances (1
PARAS, supra at 83).
JUDICIAL LEGISLATION
The judiciary is tasked with resolving legal
controversies and interpreting statutes. The
judiciary cannot legislate. However, even the
legislator himself, through Article 9 of the Civil Code,
recognizes that in certain instances, the court “must
legislate” to fill in the gaps in the law, because the
mind of the legislator is finite and therefore cannot
envisage all possible causes to which the law may
apply. (STA. MARIA, supra at 17).
DOUBT IN THE
INTERPRETATION AND
APPLICATION OF LAWS
(ART. 10)
In case of doubt in the interpretation or application of
laws, it is presumed that the lawmaking body
intended right and justice to prevail (Article 10, Civil
Code).
CUSTOMS
(ARTS. 11 AND 12)
CUSTOMS
Rules of conduct formed by repetition of acts
uniformly observed as a social rule. They are legally
binding and obligatory (STA. MARIA, supra at 18)
The law requires that "a custom must be proved as
a fact, according to the rules of evidence" (Article 12,
Civil Code) On this score the Court had occasion to
state that "a local custom as a sourceof right cannot
be considered by a court of justice unless such
custom is properly established by competent
evidence like any other fact. The same evidence, if
not one of a higher degree, should be required of a
foreign custom (Yao Kee v. Sy- Gonzales, G.R. No.
55960, November 24, 1988).
GENERAL RULE: Customs must be proved as a
fact according to the rules of evidence (In the Matter
of the Petition for Authority to Continue use of the
Firm name “Ozaeta, Romulo, etc.”, G.R. No. X92-1,
July 30, 1979).
EXCEPTION: If there is already a decision
rendered by the same court recognizing the
custom, it becomes an official act of the
judicial department which courts may take judicial
notice (RULES OF COURT, RULE 129, Sec. 2).
REQUISITES TO MAKE A CUSTOM AN
OBLIGATORY RULE (POPTUN)
1. Plurality or repetition of acts;
2. The community accepts it as a proper way of
acting, such that it is considered as Obligatory
upon all;
3. Practiced by the great mass of the social group;
4. Continued practice for a long period of Time
(ALBANO, supra at 38-39);
5. Uniformity, or identity of acts or various solutions
to the juridical question; and
6. The practice must Not be contrary to law,
morals, or public order (RABUYA, supra at 37).
RULE ON PERIODS
(ART. 13)
RULE ON PERIODS
1. Year
– 12 calendar months (E.O. 292 (1987),Book
I, Sec.31).
NOTE: Art. 13 has been superseded by E.O. No.
292 or the Revised Administrative Code of 1987.
Calendar month is "a month designatedin the
calendar without regard to the number of days it
may contain" (CIR v. Primetown Property
Group, Inc., G.R. No. 162155, August 28, 2007).
2. Month
– 30 days, unless month is identified;
If months are designated by their name, they
shall be computed by the number of days which
they respectively have (CIVIL CODE, Art. 13).
3. Day
– 24 hours;
4. Night
– Sunset to sunrise;
5. Calendar week
– Sunday to Saturday;
6. Week
– Count 7 days as indicated, notnecessarily
Sunday to Saturday.
NOTE: To count the period, First day is Excluded,
Last day is Included (FELI) (CIVIL CODE, Art. 13).
EXCEPTION: Rule does NOT apply to the
computation of age; each year is counted based on
birth anniversary (Garvida v Sales, G.R. No. 124893,
April 18, 1997).
POLICY IF THE LAST DAY IS A SUNDAY
OR A LEGAL HOLIDAY
1. The last day will automatically be considered the
next working day, if the act to be performed
within the period is prescribed or allowed by:
a. the Rules of Court;
b. an order of the court; or
c. any other applicable statute; and
2. If the act to be performed within the periodarises
from a contractual relationship, the act will
become due despite the fact that the last day
falls on a Sunday or Holiday (1 PARAS, supra at
96).
PROVISIONS ON
CONFLICT OF LAW
(ARTS. 14-18)
1. PENAL LAWS AND LAWS OF PUBLIC
SECURITY:
Territoriality rule governs regardless of the
nationality but subject to principles of
international law and to treaty stipulations (CIVIL
CODE, Art. 14).
2. LAWS RELATING TO FAMILY RIGHTS AND
DUTIES, OR TO THE STATUS, CONDITION
AND LEGAL CAPACITY OF PERSONS:
Nationality rule applies to citizens of the
Philippines even though living abroad (CIVIL
CODE, Art. 15).
RULES ON PERSONAL LAW:
a. Domiciliary Rule
– The basis for determining personal law of an
individual is his domicile.
b. Nationality Rule
– The basis for determining personal law is his
citizenship (RABUYA, supra at 42).
Thus, a Filipino spouse cannot obtain a valid divorce
abroad because his or her capacity and status are
governed by Philippines Laws.
EXCEPTION: Divorce validly obtained abroad by
alien spouse capacitating him or her to remarry; the
Filipino spouse shall have capacity to remarry under
Philippine law (FAMILY CODE, Art. 26, par. 2, as
amended by E.O. 227
(1987)).
Likewise, a Filipino citizen who initiated a divorce
proceeding abroad, has the capacity to remarry
under Philippine law after obtaining a favorable
judgment against his or her alien spouse who is
capacitated to remarry (Republicv. Manalo, G.R. No.
221029, April 24, 2018).
3. LAWS ON PROPERTY (REAL AND
PERSONAL)
LEX REI SITAE: The law of the country where the
property is situated shall govern the property (CIVIL
CODE, Art. 16, par. 1).
EXCEPTION: Intestate and testamentary
succession particularly (CIAO)
a. Capacity to succeed;
b. Intrinsic validity of testamentary provisions;
c. Amount of successional rights; and
d. Order of succession (CIVIL CODE, Art. 16,
par. 2).
Renvoi Doctrine
Literally means referring back (RABUYA, supra at
52); Occurs when a citizen of another country dies
as a domiciliary of another country. Where the
conflict rules of the forum refer to a foreign law, and
the latter refers it back to the internal law, the law of
the forum shall apply (In Re: Testate Estate of
Edward E. Christensen, G.R. No. L-16749, January
31, 1963).
Transmission Theory
As to coverage
If the foreign law refers it to a third country, the said
country’s law shall govern (SEMPIO-DIY, Conflicts
Family rights Real and Forms and
of Law (2004), p. 62) [hereinafter SEMPIO-DIY]).
and duties, personal solemnities
status, property (extrinsic validity)
Doctrine of Processual Presumption
condition, and
If the foreign law is not properly alleged and proved,
legal capacity
the presumption is that it is the same as our law (EDI-
ofpersons
Staff Builders Int’l, Inc. v. NLRC, G.R. No. 145587,
Oct. 26, 2007).
RULE ON PROHIBITIVE LAWS
4. LAWS ON FORMS AND SOLEMNITIES GENERAL RULE: Prohibitive laws concerning
persons, their acts or property, and those which
Lex Loci Celebrationis have for their object public order, public policy or
Forms and solemnities of contracts, wills, and other good customs are not rendered ineffective by laws
public instruments (extrinsic validity) shall be or judgments promulgated or by determinations or
governed by the laws of the country in which they conventions agreed upon in a foreign country (CIVIL
are executed (CIVIL CODE, Art. 17). CODE, Art. 17, par. 3).

EXCEPTION: EXCEPTION: Art. 26, par. 2 of the Family Code

a. Acts executed before diplomatic or consular (Divorce obtained abroad between an alien and a
officials. Filipino)
Intrinsic Validity of Contracts
SUPPLETORY APPLICATION
Validity is determined by the following rules:
i. The law stipulated by the parties shall be In matters which are governed by the Code of
applied; Commerce and special laws, their deficiency shall
ii. In default thereof, and the parties are ofthe same be supplied by the provisions of this Code (CIVIL
nationality, their national lawshall be applied; CODE, Art. 18).
iii. If the parties are not of the same nationalities,
the law of the place of the perfection of the
obligation shall govern its fulfillment; or
iv. If the above places are not specified and they HUMAN RELATIONS
cannot be deduced from the nature and
circumstances of the obligation, then the law of
(ARTS. 19-21)
the passivesubject shall apply (1 TOLENTINO,
supra at 57).
ABUSE OF RIGHT (CIVIL CODE, ART. 19)
LEX NATIONALII V. LEX REI SITAE V. The principle of abuse of rights departs from the
LEX LOCI CELEBRATIONIS classical theory that “he who uses a right injures no
LEX LEX REI LEX LOCI one.” The modern tendency is to depart from the
NATIONALII SITAE CELEBRATIONIS classical and traditional theory, and to grant
(ART. 15) (ART. 16) (ART. 17) indemnity for damages in cases where there is an
abuse of rights, even when the act is not illicit
(RABUYA, supra at 66 & 67).
As to basis
NOTE: Abuse of rights is actionable. This is based
Citizenship Where Where the contract on the famous maxim suum jus summa injuria (the
the wasexecuted abuse of a right is the greatest possible wrong).
property (JURADO, Civil Law Reviewer (2019), p. 34)
is situated [hereinafter JURADO, Civil Law Reviewer]).

THE FOLLOWING ELEMENTS MUST

CONCUR: (LEP)
1. Existence of a Legal right or duty;
2. Which is Exercised in bad faith;
3. For the sole intent of Prejudicing or injuring
another (Padillo v. Rural Bank of Nabunturan,
Inc., G.R. No. 199338, January 21, 2013).c
EXERCISE OF RIGHTS
The exercise of a right must be in accordance with
the purpose for which it was established and must
not be excessive or unduly harsh; there must be no
intention to harm another (Ardiente v. Sps.
Pastorfide, G.R. No. 161921, July 17, 2013).
DOCTRINE OF VOLENTI NON FIT
INJURIA (TO WHICH A PERSON
ASSENTS IS NOT ESTEEMED IN LAW
AS INJURY)
It refers to self-inflicted injuries or to the consent to
injury which precludes the recovery of damages by
one who has knowingly and voluntarily exposed
himself to danger, even if he is not negligent in doing
so (Pantaleon v. American Express International,
Inc., G.R. No. 174269 (Resolution), August 25,
2010).
DAMNUM ABSQUE INJURIA (DAMAGE
WITHOUT INJURY)
A person who exercises his legal right does noinjury.
However, it cannot be said that a person exercises
a right when he unnecessarily prejudices another or
offends morals or good customs. When damages
result from a person’s exercise of rights, it is damnum
absque injuria (ABS-CBN v. CA, G.R. No. 128690,
January 21, 1999).
ACTS CONTRARY TO LAW
Every person who, contrary to law, willfully or
negligently causes damage to another, shall
indemnify the latter for the same (CIVIL CODE, Art.
20).
ACTS CONTRA BONUS MORES
(AGAINST GOOD MORALS)
Any person who willfully causes loss or injury to
another in a manner that is contrary to morals good
customs or public policy shall compensate the latter
for the damage (CIVIL CODE, Art. 21).
ELEMENTS: (LCD)
1. Act which is Legal;
2. The act is Contrary to morals, good customs,
public order or public policy; and
3. The act is Done with intent to injure (Mendoza
v. Spouses Gonez, G.R. No. 160110, June 18,
2014).
NOTE: Damages are recoverable even if no
positive law was violated (DE LEON, Torts and
Damages, supra at 361).
BREACH OF PROMISE TO MARRY,
GENERALLY NOT ACTIONABLE
It is not by itself an actionable wrong (Hermosisima
v. CA, G.R. No. L-14628, September 30, 1960).
One cannot seek specific performance to compel
marriage.
BREACH OF PROMISE TO MARRY,
WHEN ACTIONABLE
There must be another act independent of the
breach of promise to marry which gives rise to
liability as where there was fraud or deceit, financial
damage, social humiliation, and moral seduction
(RABUYA, supra at 74 and 75).
Examples of Actionable Breach of Promise to
Marry:
1. Mere breach of promise to marry is not an
actionable wrong. However, to formally set a
wedding and go through all the preparations
and publicity, only to walk out of it when the
matrimony is about to be solemnized, is
palpably and unjustifiably contrary to good
customs for which defendant must be held
answerable in damages pursuant to Art. 21
of the Civil Code (Wassmer v. Velez, G.R.
No. L- 20089, December 26, 1964).
2. Where a man’s promise to marry was the
proximate cause of giving herself unto him in
sexual congress and there is that proof he had
no intention of marrying her, the promise being
a deceptive device, damages may be awarded
pursuant to Art. 21 of the Civil Code because of
the fraud and deceit behind it and the willful
injury to her honor and reputation (Baksh v.
Court of Appeals, G.R. No. 97336, February19,
1993).
3. Where the man forcibly abducted a woman and
had carnal knowledge with her against her will,
and thereafter promised to marry her in order to
escape criminal liability, only to thereafterrenege
on such promise after cohabiting with her for 21
days, such acts irremissibly constitute acts
contrary to morals and good customs (Buṅag v.
CA, G.R. No. 101749, July 10, 1992).
MALICIOUS PROSECUTION
An action for damages brought by one against whom
a criminal prosecution, civil suit or other legal
proceeding has been instituted maliciously and
without probable cause, after the termination of such
prosecution, suit, or other proceeding in favor of the
defendant therein (Diaz v. Davao Light and Power
Co., Inc., G.R. No. 160959, April 4, 2007).
BASIS OF ACTION
An action for damages arising from malicious
prosecution is anchored on the provisions of Arts.
21, 2217, and 2219(8) of the New Civil Code. One
cannot be held liable in damages for maliciously
instituting a prosecution where he acted with
probable cause. Malice and want of probable cause ACCION IN REM VERSO V. SOLUTIO
must both exist in order to justify a suit for malicious INDEBITI
prosecution (RABUYA, supra at 79).
ACCION IN REM SOLUTIO INDEBITI
REQUISITES: VERSO (ART. 2154)
1. The fact of prosecution and the further fact
that the defendant (respondent) was himself It is not necessary that Payment made by
the prosecutor, and that the action finally the payment was made mistake is an essential
terminated with an acquittal; by mistake; payment element to maintain the
2. That in bringing the action, the prosecutor could have been made action for recovery.
acted without probable cause; and knowingly and
3. That the prosecutor was actuated or voluntarily.
impelledby legal malice, that is, by improper Nevertheless, there
or sinister motive (Diaz v. Davao Light and would be recovery of
Power Co., Inc., G.R. No.160959, April 4, what has been paid.
2007). (1 TOLENTINO, supra at 83-84).
NOTE: Arts. 19, 20 and 21 are related to one REQUISITES: (JELACI)
another and under these articles, an act which 1. Enrichment is without Just or legal ground;
causes injury to another may be made the basis for 2. Defendant has been Enriched;
an award of damages. Arts. 19 and 21 refer to 3. Plaintiff has suffered Loss;
intentional acts while Art. 20 pertains either to 4. He has no other Action based on contract,
willful or negligent acts, which must be contrary to quasi–contract, crime or quasi–delict (Id. at 76).
law (Sesbreño v. Court of Appeals, G.R. No. 5. There must be a Causal relation between the
160689, March 26, 2014). two; and
6. The Indemnity cannot exceed the loss or
enrichment, whichever is less (1 PARAS, supra
at 148).
PRINCIPLE OF UNJUST
ENRICHMENT Even when an act or event causing damage to
another’s property was not due to the fault or
(ART. 22) negligence of the defendant, the latter shall be liable
for indemnity if through the act or event he was
benefited (CIVIL CODE, Art. 23).

MEMO CUM ALTERIUS DETER For a more comprehensive discussion of Arts. 19-
DETREMENTO PROTEST 35, please see discussion thereof under Torts and
No person should unjustly enrich himself at the Damages.
expense of another (Frenzel v. Catito, G.R. No.
143958, July 11, 2003).

ACCION IN REM VERSO PREJUDICIAL

If a person acquires or comes into possession of
something at the expense of another without just or
legal ground through an act or performance by
another or any other means has the obligation to
return the same. It is an action for recovery of what
has been paid without just cause (RABUYA, supra
at 80).
Application:
1. When a thing is acquired by or comes into
possession of another (delivery or acquisition of
things); and
2. The acquisition be undue and at the expense of
another, (without just or legal ground).
QUESTION
(ART. 36)
PREJUDICIAL QUESTION
Arises where the resolution of a case is dependent
on the resolution of an issue involved in another
case and assumed by a different tribunal. The issue
involved in the latter case is the logical antecedent
of the issue involved in the former case. (Sps.
Gaditano v. San Miguel Corp., G.R. No. 188767,
July 24, 2013).
GENERAL RULE: If both criminal and civil cases
arising from the same facts are filed in court, the
criminal case takes precedence.
EXCEPTIONS:
1. PREJUDICIAL QUESTIONS
The prejudicial question must be determinative
of the case before the court, but the jurisdiction
to try and resolve the question must be lodged
in another court or tribunal (Ching v. Court of
Appeals, G.R. No. 110844, April 27, 2000).
Elements:
a. The previously instituted civil action
involves an issue similar or intimatelyrelated
to the issue raised in the subsequent
criminal action; and
b. The resolution of such issue determines
whether or not the criminal action may
proceed. (RULES OF COURT, RULE 111,
Sec. 7).
It generally comes into play in a situation where
a civil action and a criminal action are both
pending and there exists in the former an issue
which must be preemptively resolved beforethe
latter may proceed, because howsoever the
issue raised in the civil action is resolved would
be determinative juris et de jure of the guilt or
innocence of the accused in the criminal case
(Sps. Gaditano v. San Miguel Corp., G.R. No.
188767, July 24, 2013).
NOTE: The rule authorizes only the suspension
of the criminal action and not its dismissal by
reason of a prejudicial question (RULES OF
COURT, RULE 111, Sec. 6).
Where to File Petition to Suspend
A petition for suspension of the criminal action
based upon the pendency of a prejudicial
question in a civil action may be filed in the office
of the prosecutor of the court conducting the
preliminary investigation. When the criminal
action has been filed in court for trial, the petition
to suspend shall be filed in the same criminal
action at any time before the prosecution rests
(RULES OF COURT, RULE 111, Sec. 6).
NOTE: There is no prejudicial question where
one case is administrative and the other is civil
(Te v. Court of Appeals, G.R. No. 126746,
November 29, 2000).
2. INDEPENDENT CIVIL ACTIONS
GRANTED BY LAW: (CD-RQ)
a. Breach of Constitutional and other rights
(CIVIL CODE, Art. 32);
b. Defamation, fraud, physical injuries (CIVIL
CODE, Art. 33);
c. Refusal or failure of city or municipal police
to give protection (CIVIL CODE, Art. 34);
and
d. Quasi-delict or culpa-aquiliana (CIVIL
CODE, Art. 2177).
Criminal Prosecution Does Not Constitute
Prejudicial Question to Administrative
Proceeding for Disbarment or Suspension of a
Lawyer
A criminal prosecution will not constitute a prejudicial
question even if the same facts and circumstances
are attendant in the administrative proceedings for
the disbarment or suspension of a member of the bar
because administrative cases against lawyers
belong to a class of their own. They are distinct from
and they may proceed independently of civil and
criminal cases (Wilson Po Cham v. Pizarro, A.C. No.
5499, August 16, 2005).
CIVIL PERSONALITY
(ART. 37)
CIVIL PERSONALITY
It is the aptitude of being the subject, active or
passive, of rights and obligations (ALBANO, supra
at 166).
PERSON
Any being, natural or artificial, capable of possessing
legal rights and obligations (1 PARAS, supra at 221).
A person is any being susceptible of rights and
obligations or more specifically, it is every physical
or moral, real or juridical and legal being susceptible
of rights and obligations or being the subject of legal
relations (RABUYA, supra at 128).
NOTE: Estate of a decedent is considered by law as
a person. Hence, a forgery committed after the
death of a man whose name purports to be signed
to the instrument may be prosecuted as with intent
to defraud the estate (Limjoco v. Estate of Pedro
Fragante, G.R. No. L-770, April 27, 1948).
TWO KINDS OF PERSONS
1. Natural persons
– human beings created byGod through the
intervention of parents; and
2. Juridical persons
– those created by law (1 PARAS, supra at
221).
 JURIDICAL CAPACITY V. circumstances where those that are expressly
CAPACITY TO ACT the capacity to act is conferred upon them or
JURIDICAL CAPACITY TO ACT restrained. those which can be
CAPACITY (CAPACIDED DE implied therefrom or
(CAPACIDAD OBRAR) incidental thereto.
JURIDICA)
RESTRICTIONS ON CAPACITY TO ACT:
As to Nature (MI2D-PC)
1. Minority;
Fitness to be the Power to do acts with
Minority does not exempt the minor from certain
subject of legal legal effects (CIVIL
obligations. If he does an act without theconsent
relations (CIVIL CODE, CODE, Art. 37).
of his parents or guardian, the contract is not
Art. 37).
void but is merely voidable, that is valid until
As to Status annulled. In other words, it is not that a minor
has no capacity but that his capacity is restricted
Passive. Active. (1 PARAS, supra at 223).

As to Acquisition 2. Insanity;
Inherent. Merely acquired. 3. Imbecility;

As to Condition of the Subject 4. State of being Deaf mute;

Deaf mute may either be sane or insane.
Static. Dynamic.
5. Prodigality;
As to Effect of Death It is the state of squandering money or property
with a morbid desire to prejudice the heirs of a
Lost only through Lost through death and person (Martinez v. Martinez, G.R. No. 445,
death. restricted by other March 31, 1902).
causes.

As to Existence 6. Civil interdiction (CIVIL CODE, Art. 38; 1

PARAS, supra at 237).
Can exist without Always exists with A person who suffers civil interdiction is deprived
capacity to act. juridical capacity. of: (PGDM)
a. Having Parental or marital authority.
(1 PARAS, supra at 222). b. Being the Guardian of the person and
property of a ward.
c. Disposing of his property by an act inter
FULL/COMPLETE CIVIL CAPACITY
vivos (he cannot donate, for this is an act
The union of the two kinds of capacity (Id. at 222). inter vivos; but he can make a will, for this
is a disposition mortis causa).
NOTE: A person is presumed to have capacity to act d. Managing his own property (REVISED
(Standard Oil Co. v. Arenas, G.R. No. 5921, July25, PENAL CODE, Art. 34; 1 PARAS, supra at
1911). 223)

THEORIES ON CAPACITY TO ACT NOTE: The penalty of civil interdiction is

given to a criminal punished by
THEORY OF THEORY OF
imprisonment for 12 years and 1 day or
GENERAL SPECIAL
more (REVISED PENAL CODE, Art. 41).
CAPACITIES CAPACITIES

As to Whom it is Applied The same do not exempt the incapacitated

person from certain obligations as when the
Applies persons to Applies persons to latter arise from his acts or from property
natural juridical relations such as easements (CIVIL CODE,
Art. 38).
As to Limitations

Effects apply except This limits the power of

only in those specific juridical persons only to
MODIFICATIONS/LIMITATIONS ON EXCEPTION: If the fetus had an intra-uterine life of
CAPACITY TO ACT: (IF-I-PAID-TAPA) less than 7 months, it is not deemed born if it dies
within 24 hours after its complete delivery from the
1. Insanity;
maternal womb (CIVIL CODE, Art. 41).
2. Family relations;
3. Imbecility;
Illustration:
4. Penalty;
5. Age; Intra-Uterine Life When Considered Born
6. Insolvency;
7. State of being Deaf-mute; 7 months or more Alive upon complete
8. Trusteeship; (Ordinary) delivery – even if the child
9. Alienage; dies within 24 hours
10. Prodigality; and
11. Absence (CIVIL CODE, Art. 39). Less than 7 months Alive upon complete
(Extraordinary) delivery and at least 24
hours thereafter (1
PARAS, supra at 231).
NATURAL PERSONS
HOW CIVIL PERSONALITY IS
(ARTS. 40-43) EXTINGUISHED
Civil personality is extinguished by death. The effect
of death upon the rights and obligations of the
BEGINNING OF PERSONALITY deceased is determined by law, by contract and by
will (CIVIL CODE, Art. 42).
GENERAL RULE: Birth determines personality
(actual personality) (CIVIL CODE, Art. 40).
NOTE: Civil Interdiction merely restricts, not
extinguishes, capacity to act (1 PARAS, supra at
EXCEPTION: The civil personality of the child shall
232).
commence from the time of its conception, for all
purposes favorable to him, subject to the
requirements of Art. 41 of the Civil Code (P.D. No. NO PRESUMPTION OF SURVIVORSHIP
603, Art. 5). This personality at conception is called IN SUCCESSION
presumptive personality. If there is doubt as to whom, between or amongtwo
or more persons called to succeed each other, died
The law considers the conceived child as born for first, the following rules shall apply:
all purposes favorable to it if born alive. Therefore, 1. Whoever alleges the death of one prior to the
the child has a presumptive personality, which has other shall prove the same; and
two characteristics: 2. In the absence of proof, it shall be presumed that
1. Limited; and they died at the same time. There shall be no
2. Provisional or conditional (Quimiguing v. Icao, transmission of rights from one another (CIVIL
G.R. No. L-26795, July 31, 1970). CODE, Art. 43).

NOTE: The concept of provisional personality
CANNOT be invoked to obtain damages for and in
behalf of an aborted child (Geluz v. CA, G.R. No. L-
16439, July 20, 1961).
A conceived child is already entitled to support from
its progenitors (Quimiguing v. Icao, G.R. No. L-
26795, July 31, 1970) and can be acknowledged
even before it is born (De Jesus v. Syquia, G.R. No.
39110, November 28, 1933).
WHEN IS A CHILD CONSIDERED BORN
GENERAL RULE: For civil purposes, the fetus is
considered born if it is alive at the time it is
completely delivered from the mother’s womb (CIVIL
CODE, Art. 41).
NOTE: Art. 43 applies when the case involves two
or more persons who are called to succeed each
other. But if the parties are not called to succeed
each other, Rule 131, Sec. 3 (jj) of the Rules of Court
applies. Both are to be applied only in the absence
of facts (1 PARAS, supra at 235).
PRESUMPTION OF SURVIVORSHIP IN
CASE TWO PERSONS WHO ARE NOT
CALLED TO SUCCEED DIED IN THE
SAME ACCIDENT:
That except for purposes of succession, when two
persons perish in the same calamity, such as
wreck, battle, or conflagration, and it is not shown
who died first, and there are no particular
circumstances from which it can be inferred, the
survivorship is determined from the probabilities
resulting from the strength and the age of thesexes,
according to the following rules:
1. <15 y.o. vs. <15 y.o. – the older;
2. >60 y.o. vs. >60 y.o. – the younger;
3. <15 y.o. vs. >60 y.o. – the younger;
4. Both > 15 y.o. and <60 y.o. – male if different
sexes; if the same, the older;
5. <15 y.o. or >60 y.o. vs. 15 y.o. to 60 y.o.- the
latter (RULES OF COURT, RULE 131, Sec. 3
(jj)).
NOTE: If there is a doubt, as between two or
more persons who are called to succeed each
other, as to which of them died first, whoever
alleges the death of one prior to the other, shall
prove the same; in the absence of proof, they
shall be considered to have died at the same
time (RULES OF COURT, RULE 131, Sec. 3
(kk)).
JURIDICAL PERSONS
(ARTS. 44-47)
JURIDICAL PERSON
A being of legal existence susceptible of rights and
obligations, or of being the subject of juridical
relations (Roldan v. Philippine Veterans Board, G.R.
No. L-11973, June 30, 1959).
THE FOLLOWING ARE JURIDICAL
PERSONS:
1. State and its political subdivisions (Public
Corporations);
NOTE: For a local government unit, the
corporate existence shall commence upon the
election and qualification of its chief executive
and a majority of the members of its sanggunian,
unless some other time is fixed therefor by the
law or ordinance creating it (LOCAL
GOVERNMENT CODE, Sec. 14).
2. Corporations for public interest (Quasi – Public
Corporations) – governed either by the
Corporation Code or their special charters
passed by the legislature;
For quasi-public corporations, their personality
begins as soon as they have been constituted
according to law.
3. Corporations, partnerships and associations for
private interest.
CORPORATIONS
A corporation is an artificial being created by
operation of law, having the right of succession and
the powers, attributes, and properties expressly
authorized by law or incidental to its existence
(REVISED CORPORATION CODE, Sec. 2).
PARTNERSHIPS
By a contract of partnership, two or more persons
bind themselves to contribute money, property or
industry to a common fund, with the intention of
dividing the profits among themselves; or for the
exercise of a profession (CIVIL CODE, Art. 1767).
Partnerships are governed by the contract between
partners and the provisions of the Civil Code on
Partnership.
NOTE: A sole proprietorship does not possess a
juridical personality separate and distinct from the
personality of the owner of the enterprise (Mendez
v. People, G.R. No. 179962, June 11, 2014).
RULES GOVERNING JURIDICAL
PERSONS
Juridical persons mentioned in Nos. 1 and 2 are
governed by the laws creating or recognizing them.
Private corporations are regulated by laws of
general application on the subject.
Partnerships and associations for private interest or
purpose are governed by the provisions of this Code
concerning partnerships (CIVIL CODE, Art. 46).
RIGHTS OF JURIDICAL PERSONS
1. To acquire and possess property of all kinds;
2. To incur obligations; and
3. To bring civil or criminal actions (1 PARAS,supra
at 241).
CITIZENSHIP AND
DOMICILE
(ARTS. 48)
CITIZENSHIP
It is the status of being a citizen, or of owing
allegiance to a state for the privilege of being under
its protection (Id. at 264).
NOTE: Article IV of the 1987 Philippine Constitution
enumerates the following citizens of the Philippines:
1. Those who are citizens of the Philippines at the
time of the adoption of this Constitution;
2. Those whose fathers or mothers are citizens of RESIDENCE IN CIVIL LAW VS.
the Philippines; RESIDENCE IN POLITICAL LAW
3. Those born before January 17, 1973, of Filipino
mothers, who elect Philippine citizenship upon The term residence may mean one thing in civil law
reaching the age of majority; and and quite another thing in political law.
4. Those who are naturalized in accordance with
What stands clear is that insofar as the Civil Code
law.
is concerned — affecting the rights and obligations
of husband and wife — the term residence should
COMMON MODES OF ACQUIRING only be interpreted to mean "actual residence."
CITIZENSHIP (Romualdez-Marcos v. COMELEC, G.R. No.
1. By Birth 119976, September 18, 1995).
a. Jus sanguinis – citizenship by blood,
wherever he may be born; In election cases, the Court treats domicile and
b. Jus soli – citizenship is determined by place residence as synonymous terms. Thus, the term
of birth; and ‘residence’ as used in the election law is
synonymous with ‘domicile,’ which imports not only
2. By Naturalization an intention to reside in a fixed place but also
– artificial means (judicial or administrative) by personal presence in that place, coupled with
which a state adopts an alien and gives him conduct indicative of such intention.’ ‘Domicile’
imprint and endowment of a citizen of that denotes a fixed permanent residence to which when
country (ALBANO, supra at 183). absent for business or pleasure, or for like reasons,
one intends to return (Romualdez v. Regional Trial
Court, G.R. No. 104960, September 14, 1993).
DOMICILE
For the exercise of civil rights and the fulfillment of
ELEMENTS OF DOMICILE: (PI)
civil obligations, the domicile of natural persons is
the place of their habitual residence (CIVIL CODE, 1. Physical Presence in a fixed place;
Art. 50). 2. Intention to remain permanently in said place
(animus manendi) (Romualdez-Marcos v.
COMELEC, G.R. No. 119976, September 18,
RESIDENCE V. DOMICILE 1995).
RESIDENCE DOMICILE
KINDS OF DOMICILE
As to Definition
1. Domicile of origin
Indicates a place of Denotes a fixed – That acquired by every person at birth. It is
abode, whether permanent residence, usually the place where thechild's parents reside
permanent or which when absent, one and continues until the same is abandoned by
temporary. has the intention of acquisition of new domicile (Coquilla v.
returning. Commission on Elections, G.R. No. 151914,
July 31, 2002);
As to Number
2. Domicile of choice
There can be several There can only be one – That which is chosen by a person as his more
or less permanent home; that to which,
places of residence. place of domicile.
whenever he is absent, he intends to return (In
re: Uytengsu v. Republic, G.R. No. L-6379,
As to Intention to Remain September 29, 1954); and
No length of residence It is residence coupled NOTE: Three basic rules on domicile of choice:
without intention of with intention to remain a. A man must have a domicile somewhere;
remaining will constitute for an unlimited time. b. Domicile, once established, remains until a
domicile. new one is validly acquired; and
(Romualdez-Marcos v. COMELEC, G.R. No. c. A man can have but one domicile at any
119976, September 18, 1995). given time (Ugdoracion v. COMELEC, G.R.
No. 179851, April 18, 2008).

3. Domicile by operation of law

(Constructive Domicile)
– That which the law attributes to a person
independently of his own intention or actual
 residence, ordinarily resulting from legal
domestic relations, as that of the wife arising
from marriage, or the relationof a parent and a
child (Ugdoracion v. COMELEC, G.R. No.
179851, April 18, 2008).
REQUIREMENTS FOR THE
ACQUISITION OF NEW DOMICILE
1. Bodily presence in a new locality
– actual removal or actual change of domicile;
2. Intention to remain therein (animus manendi);
and
3. Intention to abandon the old domicile (animus
non revertendi) (Romualdez v. RTC, Br. 7,
Tacloban City, G.R. No. 104960, September14,
1993; Poe v. COMELEC, G.R. No. 221697, April
5, 2016).
RULES IN DETERMINING THE
DOMICILE OF JURIDICAL PERSONS:
1. Place of Incorporation (Fixed by the law creating
or recognizing them);
2. Place where their legal representation is
established or where they exercise their
principal functions (CIVIL CODE, Art. 51).
If the corporation has a head office and branch
offices, the domicile is the location of the headoffice
(1 PARAS, supra at 366).
RIGHTS AND
OBLIGATIONS OF
COUPLES IN INTIMATE
RELATIONSHIPS
(REP. ACT NO. 9262)
THE ANTI-VIOLENCE AGAINST WOMEN
AND THEIR CHILDREN ACT (MARCH 27,
2004)
Not Violative of Equal Protection Clause
Rosalie Jaype-Garcia, determined to separate from
her husband but fearing he would take her children
from her and deprive her of financial support, filed
for herself and her children a Temporary Protection
Order against her husband Jesus C. Garcia
pursuant to the Anti-Violence Against Women and
Children Act (R.A. No. 9262). Petitioner Jesus C.
Garcia raised the constitutionality of R.A. No. 9262
for being violative of the equal protection and due
clauses. Here, the Supreme Court upheld the
constitutionality of the law, stating that R.A. 9262
does not violate the guaranty of equal protection of
the laws. It rests on substantial distinctions. The
unequal power relationship between women and
men; the fact that women are more likely than men
to be victims of violence; and the widespread gender
bias and prejudice against women all make for real
differences justifying the classification under the law
(Garcia v. Drilon, G.R No. 179276).
VIOLENCE AGAINST WOMEN AND
THEIR CHILDREN (VAWC)
It refers to any act or a series of acts committed by
any person against the following, within or without
the family abode, which result in or is likely to result
in physical, sexual, psychological harm or suffering,
or economic abuse including threats of such acts,
battery, assault, coercion, harassment or arbitrary
deprivation of liberty (R.A. No. 9262, Sec. 3(a)):(W-
WFRCom-C)
1. A Woman -
a. Who is his Wife;
b. Who is his Former wife;
c. With whom the person has or hada sexual
or dating Relationship;
d. With whom he has a Commonchild; or
2. Her Child whether legitimate or
illegitimate.
WHO ARE LIABLE
1. Husband;
2. Former Husband;
3. Any person with whom the woman has
or had a sexual or dating relationship;
a. Dating Relationship
– a situation wherein the parties live as
husband and wife without the benefit of
marriage or are romantically involved over
time and on a continuing basis during the
course of the relationship (R.A. No. 9262,
Sec. 3(e)).
NOTE: A casual acquaintance or ordinary
socialization between two individuals in a
business or social context is not a dating
relationship.
b. Sexual Relations
– a single sexual act which may or may
not result in the bearing of a common child
(R.A. No. 9262, Sec. 3(f)).
NOTE: There is no qualification as to the
sex of the partner in the use of “any person”.
 Hence, it is possible for a woman in a
relationship with another woman to be
charged of violating VAWC Law.
4. Any person with whom the woman has a
common child; or
5. Any person committing the acts or
series of acts of violence against her
child, whether legitimate or illegitimate.
Children – those below eighteen (18) years of
age or older but are incapable of taking care of
themselves as defined under Republic Act No.
7610, including the biological children of the
victim or other children in her care.
KINDS OF VIOLENCE UNDER VAWC
1. Physical violence
– acts that include bodily or physical harm;
2. Sexual Violence
– act which is sexual in nature, committed
against a woman or her child, including but not
limited to:
a. Rape, sexual harassment, acts of
lasciviousness, treating a woman or her
child as a sex object, making demeaning
and sexually suggestive remarks, physically
attacking the sexual parts of the victim's
body, forcing her/him to watch obscene
publications and indecent shows or forcing
the woman or her child to do indecent acts
and/or make films thereof, forcing the wife
and mistress/lover to live in the conjugal
home or sleep together in the same room
with the abuser;
b. Acts causing or attempting to cause the
victim to engage in any sexual activity by
force, threat of force, physical or other harm
or threat of physical or other harm or
coercion;
c. Prostituting the woman or her child.
3. Psychological Violence
– acts or omissions causing or likely to cause
mental or emotional suffering of the victim (i.e.
intimidation, harassment, stalking, damage to
property, public ridicule or humiliation, repeated
verbal abuse and marital infidelity), including:
a. Causing or allowing the victim to witness the
physical, sexual or psychologicalabuse of a
member of the family to which the victim
belongs,
b. Causing or allowing the victim to witness
pornography in any form or to witness
abusive injury to pets or to unlawful or
unwanted deprivation of the right tocustody
and/or visitation of common children.
4. Economic Abuse
– acts that make or attempt to make a woman
financially dependent which includes, but is not
limited to:
a. Withdrawal of financial support or
preventing the victim from engaging in any
legitimate profession, occupation, business
or activity, except in cases wherein the other
spouse/partner objectson valid, serious and
moral grounds as defined in Article 73 of the
Family Code;
b. Deprivation or threat of deprivation of
financial resources and the right to the use
and enjoyment of the conjugal, community
or property owned in common;
c. Destroying household property;
d. Controlling the victim's own money or
properties or solely controlling the conjugal
money or properties (R.A. No. 9262, Sec.
3(a)).
ACTS OF VIOLENCE AGAINST WOMEN
AND THEIR CHILDREN (R.A. NO. 9262,
SEC. 5)
1. Causing physical harm to the woman or her
child;
2. Threatening to cause the woman or her child
physical harm;
3. Attempting to cause the woman or her child
physical harm;
4. Placing the woman or her child in fear of
imminent physical harm;
5. Attempting to compel or compelling the woman
or her child to engage in conduct which the
woman or her child has the right to desist from
or desist from conduct which the woman or her
child has the right to engage in, or attempting to
restrict or restricting the woman's or her child's
freedom of movement or conduct by force or
threat of force, physical or other harm or threat
of physical or other harm, or intimidation
directed against the woman or child. This shall
include, but shall not be limited to, the following
acts committed with the purpose or effect of
controlling or restricting the woman's or her
child's movement or conduct:
a. Threatening to deprive or actually depriving
the woman or her child of custody to her/his
family;
b. Depriving or threatening to deprive the
woman or her children of financial support
legally due her or her family, or deliberately
 providing the woman's children insufficient
financial support;
NOTE: In one case where a foreign national who
refused to support his minor child and claimed
he was not obliged to support said son
altogether under Art. 195 of the Civil Code as he
was not a Filipino citizen, the Supreme Court
held that the respondent foreign national was
criminally liable under Sec. 5(e)(2) of R.A. No.
9262 for his unjustified failure to support his
minor child when the respondent foreign
national failedto allege and prove the foreign law
applicable to him, thus allowing the doctrine of
processual presumption to govern. The Court
reiterated its earlier ruling where it stated that
when the foreign law, judgment or contract is
contrary to a sound and established public policy
of the forum, the said foreign law, judgment or
order shall not be applied (See Del Socorro v.
Van Wilsem, G.R. no. 193707, December 10,
2014).
c. Depriving or threatening to deprive the
woman or her child of a legal right; and
d. Preventing the woman in engaging in any
legitimate profession, occupation, business
or activity or controlling the victim's own
money or properties, or solely controlling the
conjugal or common money, or properties;
6. Inflicting or threatening to inflict physical harm
on oneself for the purpose of controlling her
actions or decisions;
7. Causing or attempting to cause the woman or
her child to engage in any sexual activity which
does not constitute rape, by force or threat of
force, physical harm, or through intimidation
directed against the woman or her child or her
immediate family;
8. Engaging in purposeful, knowing, or reckless
conduct, personally or through another that
alarms or causes substantial emotional or
psychological distress to the woman or her child.
This shall include, but shall not be limited to, the
following acts:
a. Stalking or following the woman or her child
in public or private places;
b. Peering in the window or lingering outside
the residence of the woman or her child;
c. Entering or remaining in the dwelling or on
the property of the woman or her child
against her/his will;
d. Destroying the property and personal
belongings or inflicting harm to animals or
pets of the woman or her child; and
e. Engaging in any form of harassment or
violence;
9. Causing mental or emotional anguish, public
ridicule or humiliation to the woman or her child,
including, but not limited to, repeated verbal and
emotional abuse, and denial of financial support
or custody of minor children of access to the
woman's child/children.
ELEMENTS OF PSYCHOLOGICAL
VIOLENCE UNDER SECTION 5(I)
1. The offended party is a woman and/or her child
or children;
2. The woman is either the wife or former wife of
the offender, or is a woman with whom the
offender has or had a sexual or dating
relationship, or is a woman with whom such
offender has a common child.As for the woman's
child or children, they may be legitimate or
illegitimate, or living within or without the family
abode;
3. The offender causes on the womanand/or child
mental or emotional anguish; and
4. The anguish is caused through acts of public
ridicule or humiliation, repeated verbal and
emotional abuse, denial of financial support or
custody of minor children or access to the
children or similar such acts or omissions.
To establish psychological violence as an element of
the crime, it is necessary to show proof of
commission of any of the actsenumerated in Section
5 (i) or similar suchacts. And to establish mental or
emotional anguish, it is necessary to present the
testimony of the victim as such experiences are
personal to this party.
NOTE: Neither the physical injuries suffered by the
victim nor the actual physical violence done by the
perpetrator are necessary to prove the essential
elements of the crime as defined in Section 5 (i) of
RA 9262. The only exception is, as in the case at
bar, when the physical violence done by the accused
is alleged to have caused the mental and emotional
suffering; in which case, such acts of physical
violence must be proven. (Dinamling v. People, G.R.
No. 199522, June 22, 2015).
NOT MARITAL INFIDELITY PER SE
What R.A. No. 9262 criminalizes is not the marital
infidelity per se but the psychological violence
causing mental or emotional suffering on the wife.
Otherwise stated, it is the violenceinflicted under the
said circumstances that the law seeks to outlaw.
Marital infidelity as citedin the law is only one of the
various acts by which psychological violence may be
committed (AAA v. BBB, G.R. No. 212448,January
11, 2018).
PRESCRIPTIVE PERIOD
1. Acts falling under Sections 5(a) to 5(f) –
within 20 years.
2. Acts falling under Sections 5(g) to 5(i) –
within10 years (R.A. No. 9262, Sec. 24).
PUBLIC CRIME
Violence against women and their children shall be
considered a public offense which may be
prosecuted upon the filing of a complaint by any
citizen having personal knowledge of the
circumstances involving the commission of the crime
(R.A. No. 9262, Sec. 24).
COOLING-OFF PERIOD DOES NOT
APPLY
In cases of legal separation, where violence as
specified in R.A. 9262 is alleged, Art. 58 of the
Family Code on the 6 months cooling-off period shall
not apply. The court shall proceed on the main case
and other incidents of the case as soon as possible.
The hearing on any application for a protection order
filed by the petitioner must be conducted within the
mandatory period specified (R.A. No. 9262, Sec.
19).
BATTERED WOMAN SYNDROME AS A
DEFENSE IN CRIMINAL AND CIVIL
CASES AGAINST VICTIMS-SURVIVORS
Battered Woman Syndrome is a scientifically
defined pattern of psychological and behavioral
symptoms found in women living in battering
relationships as a result of cumulative abuse (R.A.
No. 9262, Sec. 3(c)).
BWS CHARACTERIZED BY A CYCLE OF
VIOLENCE:
1. Tension-building Phase
– where minor battering occurs, by verbal or
slight physical abuse or another form of hostile
behavior; The woman usually tries to pacify the
batterer through a show of kind, nurturing
behavior; or by simply staying out of his way.
What actuallyhappens is that she allows herself
to be abused in ways that, to her, are
comparatively minor. All she wants is to prevent
the escalation of the violence exhibited by the
batterer.
2. Acute Battering Incident
– characterized by brutality, destructiveness
and, sometimes, death. It is unpredictable, and
such incidents are often very savage and out of
control, such that innocent bystanders or
intervenors are likely to get hurt.
3. Tranquil, Loving or Non-Violent Phase
– this begins when the acute battering incident
ends. The couple experience profound relief.
The batterer may show a tender and nurturing
behavior towards his partner. He knows that he
has been viciously cruel and tries to make up for
it, begging for her forgiveness and promising
never to beat her again. On the other hand, the
battered woman also tries to convince herself
that the battery will never happen again; that her
partner will change for the better; and that this
"good, gentle and caring man" is the real person
whom she loves (People v. Genosa, G.R. No.
135981, January 15, 2004).
NOTE: People v. Genosa was decided prior
to the enactment of R.A. No. 9262.
Victim-survivors who are found by courts to be
suffering from BWS do not incur any criminal and
civil liability notwithstanding absence of any of the
elements for justifying circumstances under the
Revised Penal Code. The courts shall be assisted by
expert psychiatrists/psychologists (R.A. No. 9262,
Sec. 26).
PROTECTION ORDER
A protection order is an order issued for the purpose
of preventing further acts of violence against a
woman or her child specified in Section 5 of this Act
and granting other necessary relief.
PURPOSE: Safeguarding the victim from further
harm, minimizing any disruption in the victim's daily
life, and facilitating the opportunity and ability of the
victim to independently regain control over her life.
The provisions of the protection order shall be
enforced by law enforcement agencies (R.A. No.
9262, Sec. 8).
KINDS OF PROTECTION ORDERS
1. Barangay Protection Order (BPO)
– issued by the Punong Barangay and effective
for 15 days (Sec. 14);
2. Temporary Protection Order (TPO)
– issued by the court and effective for 30 days,
but may be extended or renewed for a period of
30 days at each particular time until final
judgment (Sec. 15 and 16).
3. Permanent Protection Order (PPO)
– issued by the court and effective until revoked
by the court upon application of the person in
whose favor it was issued (Sec. 16).
NOTE: Issuance of a BPO or pendency of an
application for BPO shall not preclude application
or granting of a TPO or PPO (R.A. No. 9262, Sec.
8).

WHO MAY FILE PETITION FOR
PROTECTION ORDERS
1. Offended party;
2. Parents or guardians of offended party;
3. Ascendants, descendants, or collateral relatives
within the fourth civil degree of consanguinity or
affinity;
4. Officers or social workers of the DSWD or social
workers of LGUs;
5. Police officers, preferably those in charge of
women and children’s desks;
6. Punong Barangay or Barangay Kagawad;
7. Lawyer, counselor, therapist, or healthcare
provider of petitioner; or
8. At least two (2) concerned responsible citizens
of the city or municipality where the violence
against women and their children occurred and
who has personal knowledge of the offense
committed (R.A. No. 9262, Sec. 9).
VENUE
Original and exclusive jurisdiction lies with the RTC
designated as a Family Court. In its absence, the
case shall be filed in the Regional Trial Court where
the crime or any of its elements was committed at
the option of the complainant (R.A. No. 9262, Sec.
7).
RELIEFS OFFERED BY PROTECTION
ORDERS
(a) Prohibition of the respondent from threatening to
commit or committing, personally or through
another, any of the acts mentioned in Section5
of this Act;
(b) Prohibition of the respondent from harassing,
annoying, telephoning, contacting or otherwise
communicating with the petitioner, directly or
indirectly;
(c) Removal and exclusion of the respondent from
the residence of the petitioner, regardless of
ownership of the residence, either temporarily
for the purpose of protecting the petitioner, or
permanently where no property rights are
violated, and, if respondent must remove
personal effects from the residence, the court
shall direct a law enforcement agent to
accompany the respondent to the residence,
remain there until respondent has gathered his
things and escort respondent from the residence
(d) Directing the respondent to stay away from
petitioner and any designated family or
household member at a distance specified by
the court, and to stay away from the residence,
school, place of employment, or any specified
place frequented by the petitioner and any
designated family or household member;
(e) Directing lawful possession and use by
petitioner of an automobile and other essential
personal effects, regardless of ownership, and
directing the appropriate law enforcementofficer
to accompany the petitioner to the residence of
the parties to ensure that the petitioner is safely
restored to the possession of the automobile
and other essential personal effects, or to
supervise the petitioner's or respondent's
removal of personal belongings
(f) Granting a temporary or permanent custody of a
child/children to the petitioner;
(g) Directing the respondent to provide support to
the woman and/or her child if entitled to legal
support. Notwithstanding other laws to the
contrary, the court shall order an appropriate
percentage of the income or salary of the
respondent to be withheld regularly by the
respondent's employer for the same to be
automatically remitted directly to the woman.
Failure to remit and/or withhold or any delay in
the remittance of support to the woman and/or
her child without justifiable cause shall render
the respondent or his employer liable for indirect
contempt of court;
(h) Prohibition of the respondent from any use or
possession of any firearm or deadly weapon and
order him to surrender the same to the court for
appropriate disposition by the court, including
revocation of license and disqualification to
apply for any license to use or possess a firearm.
If the offender is a law enforcement agent, the
court shall order the offender to surrender his
firearm and shall direct the appropriate authority
to investigate on the offender and take
appropriate action on the matter;
(i) Restitution for actual damages caused by the
violence inflicted, including, but not limited to,
property damage, medical expenses, childcare
expenses and loss of income;
(j) Directing the DSWD or any appropriate agency
to provide petitioner temporary shelter and other
social services that the petitionermay need; and
(k) Provision of such other forms of relief as the
court deems necessary to protect and provide
for the safety of the petitioner and any
designated family or household member,
provided petitioner and any designated family or
household member consents to such relief (R.A.
No. 9262, Sec. 8).
RIGHTS OF VICTIMS UNDER VAWC
(CIL-PADME)
1. To have Custody of children;
Children below 7 years old or older but with
mental or physical disabilities are automatically
given to the mother, with right to support,
unless the court finds compelling reasons to
order otherwise (R.A. No. 9262, Sec. 28).
A victim of Battered Woman Syndrome shall not
be disqualified from having custody of her
 children. In no case shall custody of minor
children be given to perpetrator of a woman
suffering from BWS (R.A. No. 9262, Sec. 28).
2. To be Informed of their rights, remedies
available and procedures, and privileges
for indigent litigants;
Prosecutors and court personnel should
communicate with the victim in a language
understood by the woman or her child. (R.A. No.
9262, Sec. 29).
3. Entitlement to Leave;
Victims are entitled to take a paid Leave of
Absence up to 10 days, in addition to their paid
leaves under the Labor Code and Civil Service
Rules and Regulations extendible when the
necessity arises as specified in the protection
order. (R.A. No. 9262, Sec. 43).
4. To Privacy and Confidentiality;
All records pertaining to cases of violence
against women and their children including
those in the barangay shall be confidential and
all public officers and employees and public or
private clinics and hospitals shall respect the
right to privacy of the victim. Whoever publishes
or causes to be published, in any format, the
name, address, telephone number, school,
business address, employer, or other identifying
information of a victim or an immediate family
member, without the latter's consent, shall be
liable to the contempt power of the court (R.A.
No. 9262, Sec. 44).
5. Additional rights (R.A. No. 9262, Sec. 35)
Additional Rights of Victims (RD-LSFI)
a. To be treated with Respect and Dignity;
b. To avail of Legal assistance from PAO or
any public legal assistance office;
c. To be entitled to Support services from
DSWD and LGUs;
d. To be entitled to all legal remedies and
support provided for under the Family
Code; and
e. To be Informed of their rights and services
available to them including their right to
apply for a protection order (R.A. No. 9262,
Sec. 35).
6. Entitled to Damages (actual,
compensatory, moral and exemplary)
(R.A. No. 9262, Sec. 36);
7. Mandatory programs and services for
victims; and
The DSWD, and LGUs shall provide the victims
temporary shelters, provide counseling, psycho-
social services and/or, recovery, rehabilitation
programs and livelihood assistance. The DOH
shall provide medical assistance to victims (R.A.
No. 9262, Sec. 40).
8. Exemption from payment of docket fees
and other expenses;
a. If the victim is indigent; or
b. If there is an immediate necessity due to
imminent danger or threat of danger to act
on an application for a protection order,
The court shall accept the application without
payment of the filing fee and other fees and of
transcript of stenographic notes (R.A. No. 9262, Sec.
39).
FAMILY CODE
Executive Order No. 209 otherwise known as Family
Code of the Philippines took effect on August 3,
1988.
MARRIAGE
(ARTS. 1-25)
MARRIAGE
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
(FAMILY CODE, Art. 1).
In Republic v. Nolasco, G.R. No. 94053, March 17,
1993, the Supreme Court stressed the strong need
to protect “…the basic social institutions of marriage
and the family in the preservation of which the State
has the strongest interest”; the public policy here
involved is of the most fundamental kind.
In Article II, Section 12 of the Constitution, there is
set forth the following basic state policy: “The State
recognizes the sanctity of family life and shall protect
and strengthen the family as a basic autonomous
social institution”. The same sentiment has been
expressed in the Family Code of the Philippines in
Art. 149: ‘The family, being the foundation of the
nation, is a basic social institution which public policy
cherishes and protects. Consequently, family
relations are governed by law and no custom,
practice or agreement destructiveof the family shall
be recognized or given effect (Republic v. Nolasco,
G.R. No. 94053, March 17, 1993).
Marriage shall not be a reason to disqualify a MARRIAGE V.
female employee from work ORDINARY CONTRACT
Where a company’s policy disqualified from work
any woman worker who contracts marriage, the MARRIAGE ORDINARY
Supreme Court invalidated such policy as it notonly CONTRACT
runs afoul of the constitutional provision on equal
protection but also on the fundamental policy of the As to Parties
State toward marriage (Philippine Telegraph and
Contracting parties must Two or more
Telephone Company v. NLRC, G.R. No. 118978,
only be two persons – parties regardless of
May 23, 1997).
one man and one gender.
woman.
Absence of Real Intention to Establish a Life
Together is Insufficient to Nullify the Marriage As to Duration
In Republic v. Albios, G.R. No. 198780,October
16, 2013, the Supreme Court said that, “the Permanent contract. Parties can fix a period
possibility that the parties in a marriage mighthave for its efficacy to be
no real intention to establish a life together is, ineffective after a few
however, insufficient to nullify a marriage freely years.
entered into in accordance with law. There is no
law that declares a marriage void if it is entered into As to Actions for Breach
for purposes other than what the Constitution or law
declares, such as the acquisition of foreign Breach of obligations of Breach of ordinary
citizenship”. husband and wife does contracts gives rise to
not give rise to an action anaction for damages.
NOTE: Contracting parties must be of different sex. for damages. The law
The first article of the Family Code explicitly provides provides penal and civil
that marriage should be between a man and a sanctions such as
woman (STA.MARIA, supra at 113). prosecution for adultery
or concubinage and
Effect of Sex Change proceedings for legal
A person who had a biological sex change from male separation, action for
to female through gender re-assignment surgery support, etc.
and sought the amendment of his birth certificate to
reflect the change in sex as a preliminary step to get As to Termination
married to his partner remains to be a male. The
Can be dissolved only Can be dissolved by
Supreme Court ruledthat sex determined visually by
by death or annulment, mutual agreement and
looking at the genitals of a baby at the time of birth
not by mutual by other legal causes.
is immutable and that there is no law legally
agreement.
recognizing gender sex re-assignment (Silverio v.
Republic, G.R. No. 174689, October 19, 2007). As to Kind
However, if a person was found out to have Special contract. Merely a contract.
Congenital Adrenal Hyperplasia which is a
condition where the person afflicted has both male As to Nature
and female characteristics and organs and where
through expert evidence, it was shown that the Both a contract and an Merely a contract.
person, though genetically female, secreted male inviolable social
hormones and not female hormones, the Supreme institution.
Court considered the person as an “intersex
individual” and granted the preference of the As to Governing Law
person to be considered as a male person, allowing
Governed by law Governed by law on
the correction of the entry in his birth certificate from
marriage contracts
female to male and the change of his name from
Jennifer to Jeff (Republic v. Cagandahan, G.R. No. As to Stipulation by the Parties
166676,September 12, 2008).
Not subject to Generally subject to
stipulations except in stipulations
property relations
 MARRIAGE ORDINARY ESSENTIAL REQUISITES OF
CONTRACT MARRIAGE: (LC)
1. Legal capacity of the contracting parties, who
As to Legal Capacity must be a male and a female; Eighteen (18) years
old or above; and not under any impediment
Personal legal capacity Minors may contract mentioned in Arts. 37 and 38 (FAMILY CODE,
is required. through their parents or Art. 5); and
guardians or in some 2. Consent freely given in the presence of a
cases by themselves. solemnizing officer (FAMILY CODE, Art. 2).
(1 PARAS, supra at 334).
NOTE: Consent is different from motive. A freely
RIGHT TO PRIVACY PRESERVED given consent requires that the contracting parties
willingly and deliberately enter into the marriage.
The intimacies between husband and wife do not
Motives, such as acquiring foreign citizenship
justify any one of them in breaking the drawers and
(Republic v. Albios, G.R. No. 198780, October 16,
cabinets of the other and in ransacking them for any
2013) or out of reverence for the other spouse's
telltale evidence of marital infidelity. A person, by
parents (Republic v. Romero II, G.R. Nos. 209180
contracting marriage, does not shed his/her integrity
& 209253, February 24, 2016), are immaterial for
or his right to privacy as an individual and the
the determination of the validity of marriage.
constitutional protection is ever available to him or to
her (Zulueta v. CA, G.R. No. 107383, February 20,
1996). FORMAL REQUISITES OF MARRIAGE:
(ALM)
Marriage is an inviolable social institution. In 1. Authority of the solemnizing officer;
marriage, the parties assume new relations to each 2. Valid Marriage License; and
other and the State touching nearly everyaspect of 3. Marriage ceremony where the contracting
life and death. In a real sense, there are three parties parties appear before the solemnizing officer
to every civil marriage: two willing spouses and an and personally declare that they take each other
approving State (Manuel v. People, G.R. No. as husband and wife in the presence of not less
165842, November 29, 2005). than 2 witnesses of legal age (FAMILY CODE,
Art. 3).
The State is a party at interest to the marriage
together with the husband and wife. Therelationship EFFECTS OF NONCOMPLIANCE WITH
is one in which the State is deeply concerned, and THE REQUISITES
over which the State exercises a jealous and
exclusive dominion (RABUYA, supra at167).
(FAMILY CODE, ART. 4)
ESSENTIAL FORMAL
MARRIAGE IS GOVERNED BY LAW AND Void ab initio
CANNOT BE SUBJECT TO (e.g., Essential: Marriage of a minor;
Absence
STIPULATIONS Formal: Marriage with expired license)
GENERAL RULE: The law declares that the nature,
consequences, and incidents of marriage are to be Voidable
governed by law and cannot be subject to (e.g., consent
stipulations (FAMILY CODE, Art. 1). obtained through
Defect force and
EXCEPTION: Marriage settlements may fix the intimidation;
property relations of the spouses during the (FAMILY CODE,
marriage (Id.). Arts. 45 and 46)
Valid, but the
But even this freedom “to fix the property relations person
during the marriage” is not absolute as the same responsible for
must be exercised “within the limits provided by this the irregularity
Code” (RABUYA, supra at 167). shall be civilly,
administratively,
and criminally
liable. If the
Irregularity
irregularity was
caused by the civil
registrar, he shall
 ESSENTIAL FORMAL fraudulent for the purposes of immigration, is not
void ab initio and continues to be valid and
also be subsisting (Republic v. Albios, G.R. No. 198780,
administratively October 16, 2013).
liable.
COMMON LAW MARRIAGE
(Example of
A non-ceremonial or informal marriage by
irregularity:
agreement, entered into by a man and a woman
1. No witnesses having capacity to marry, ordinarily without
of legal age; compliance with such statutory formalities as those
2. Only one pertaining to marriage licenses. Common law
witness of marriages are not recognized in the Philippines
legal age; (STA.MARIA, supra at 127).
3. Witnesses but
not of legal FORMAL REQUISITES OF MARRIAGE:
age during the
marriage A. AUTHORITY OF SOLEMNIZING
ceremony OFFICER
(STA.MARIA,
supra at 128); It is not the presence of the solemnizing officer
or which constitutes the formal requirement but the
4. Issuance of presence of the solemnizing officer’s authority at the
marriage time of the solemnization of the marriage.
license despite
absence of PERSONS WHO MAY SOLEMNIZE MARRIAGE:
publication (PICC-CM)
prior to the a. Priest, rabbi, imam or minister of any church or
completion of religious sect;
the 10-day i. Duly authorized by his church or religious
period for sect;
publication ii. Registered with the office of the civil
(Alcantara v. registrar general;
Alcantara, iii. Acting within the limits of the written
G.R. No. authority granted; and
167746, iv. At least 1 of the parties belongs to the
August 28, solemnizing officer’s church or religious sect
2007). (FAMILY CODE, Art. 7).

(STA.MARIA, supra at 126). A priest who is commissioned and allowed by

NOTE: When either or both of the spouses is/are
over 18 but below 21 years old, failure to obtain
parental consent, will render the marriage voidable
(FAMILY CODE, Art. 14).
his local ordinary to marry the faithful, is
authorized to do so only within the area of the
diocese or place allowed by his Bishop (Navarro
v. Domagtoy, A.M. No. MTJ-96-1088, July 19,
1996).

b. Incumbent member of the judiciary within the

MARRIAGE IN JEST IS VOID FOR LACK
OF CONSENT
A pretended marriage, legal in form but entered into
as a joke, with no real intention of entering into the
actual marriage status, and with a clear
understanding that the parties would not be bound.
The ceremony is not followed by any conduct
indicating a purpose to enter into such a relation.
Marriages in jest are void ab initio, not for vitiated,
defective, or unintelligent consent, but for a
complete absence of consent (1 TOLENTINO, supra
at 231).
But a marriage entered into solely for the purpose of
acquiring American Citizenship, therefor sham or
court’s jurisdiction (FAMILY CODE, Art.7);
An appellate court Justice or a Justice of
Supreme Court has jurisdiction over the entire
Philippines to solemnize marriages, regardless of
the venue, as long as the requisites of the law are
complied with. However, judges who are appointed
to specific jurisdictions, may officiate in weddings
only within said areas and not beyond. Where a
judge solemnizes a marriage outside his court's
jurisdiction, there is a resultant irregularity in the
formal requisite laid down in Article 3, which while it
may not affect the validity of the marriage, may
subject the officiating official to administrative liability
(Navarro v. Domagtoy, A.M. No. MTJ-96-1088, July
19, 1996). It is however believed that this is a non-
binding obiter dictum as the Supreme Court declared
that “in as much as respondent judge’s jurisdiction
covers the municipalities of Sta Monica and Burgos,
he was not clothed with authority to solemnized a
marriage in the Municipality of Dapa, Surigao Del
Norte.” (See similar ruling in Keuppers v. Judge
Murica, AM No. MTJ-15-1860, April 3, 2018).
NOTE: The jurisdiction of the members of the
Supreme Court, the Court of Appeals, the
Sandiganbayan, and the Court of Tax Appeals to
solemnize marriages is the entire country (SEMPIO
– DIY, Handbook on the Family Code of the
Philippines (1995), p. 12) [hereinafter SEMPIO –
DIY].
c. Ship Captains or airplane chiefs;
i. The marriage must be in articulo mortis
(one of the parties is at the point of death);
ii. The marriage must be between
passengers or crew members;
iii. The ship must be at sea or the plane must
be in flight; including stopovers at ports of
call (FAMILY CODE, Arts. 7 and 31).
NOTE: Such marriages can be solemnized
during stopovers at ports of call, wherein the
voyage is not yet terminated and includes
instances when there are transit passengers
which the others affirmed (Minutes of the 147th
joint Civil Code and Family Law committees held
on July 19, 1986, page 10).
d. Commander of a military unit, in theabsence of
chaplain;
i. He or she must be a militarycommander of
a unit;
NOTE: Unit refers to a battalion under the
present table of organization and not a mere
company (MINUTES OF THE CIVIL CODE
REVISION, p. 4).
ii. He or she must be a commissionedofficer;
NOTE: Rank should start from 2nd
Lieutenant, ensign, or above (STA. MARIA,
supra at 142).
iii. A chaplain must be assigned to suchunit;
iv. Such chaplain is absent at the time ofthe
marriage;
v. Marriage must be in articulo mortis;and
vi. The contracting parties, whether members
of the armed forces or civilians, must be
within the zone of military operation
(FAMILY CODE, Arts. 7 and 32).
e. Consul generals, consuls or vice–consuls of the
Republic of the Philippines abroad;
i. The marriage must be between Filipino
Citizens;
ii. Only said officials have the authority to
solemnize marriages abroad;
iii. These officials must also perform the duties
of an LCR (i.e., issuance of marriage
license) (FAMILY CODE, Arts. 7 and 10).
The solemnities established by Philippine laws
shall be observed in their execution (CIVIL
CODE, Art. 17).
f. Municipal and city Mayors (R.A. No. 7160
otherwise known as Local Government Code of
1991, Secs. 444(b)(1)(xviii) - 445).
NOTE: An “Acting Mayor” or a “Vice Mayor Acting as
Mayor” may also solemnize marriages (People v.
Bustamante, citing Laxamana v. Baltazar, G.R. No.
11598, January 27, 1959)(See also Sec 445(a)(4) of
the Local Government Code).
GENERAL RULE: Marriages solemnized by any
person not legally authorized to perform marriages
are void (FAMILY CODE, Art. 35, par. 2).
EXCEPTION: Marriages that were contracted with
either or both parties believing in goodfaith that the
solemnizing officer had the legal authority to do so
(FAMILY CODE, Art. 35, par. 2).
AUTHORIZED VENUES OF MARRIAGE
GENERAL RULE: Must be solemnized publicly,and
not elsewhere, in the:
a. Chambers of the judge or in open court;
Article 8 of the Family Code requires that
marriage by a judge should only be in his office
or courtroom (Keuppers v. Judge Murica, AM
No. MTJ-15-1860, April 3, 2018).
Article 8 of the Family Code clearly states that a
marriage can be held outside the judge's
chambers or courtroom only in the following
instances:
1) At the point of death;
2) In remote places in accordance with Article
29; or
3) Upon the request of both parties in writing in
a sworn statement to this effect (Keuppers
v. Judge Murcia, AM No. MTJ-15-1860,
April 3,2018).
b. Church, chapel or temple; or
c. Office of consul–general, consul or vice–
consul (FAMILY CODE, Art. 8).
EXCEPTIONS: (HAR)
a. Marriage at a House or place designated by the
parties in a sworn statement to that effect, with
 the written request of both parties to the
solemnizing officer;
b. Marriage in Articulo mortis; and
c. Marriage in Remote places (FAMILY CODE,
Art. 8; STA.MARIA, supra at 146).
NOTE: This provision is directory and non-
compliance with the requirement that the marriage
be solemnized publicly inspecific places will only be
an irregularity that will not affect the validity of the
marriage.
B. VALID MARRIAGE LICENSE
Issued by the Local Civil Registrar (LCR) of the city
or municipality where either of the contracting party
habitually resides (FAMILY CODE, Art. 9).
enable such party to appear personally
before the LCR; and
ii. That he took the necessary steps to
ascertain the ages and relationship of
the contracting parties and the absence
of legal impediment to the marriage
(FAMILY CODE, Art. 29).
b. In cases of marriage between a man and a
woman living together as husband and wifefor at
least 5 years without legal impediment to marry
each other, the solemnizing officer must state
under oath that he ascertained the qualifications
of the contracting parties and found no legal
impediment to the marriage (FAMILY CODE,
Art. 34).

GENERAL RULE: The LCR, even if he finds an PARENTAL CONSENT V. PARENTAL

impediment in the impending marriage, must ADVICE
nevertheless issue the marriage license (FAMILY
PARENTAL CONSENT PARENTAL ADVICE
CODE, Art. 18).
As to Definition
EXCEPTIONS:
a. Where he is judicially restrained fromissuing the The consent given by The advice given by
marriage license as ordered otherwise by a the father, mother, the parents or
competent court at his own instance or that of surviving parent, guardian of any
any interested party (FAMILY CODE, Art. 18). guardian, or persons contracting party
b. Where the law clearly provides that, as to the having legal charge of between ages of 21
foreigner, the certificate of legal capacity is a them, in the order to 25 upon the
necessary requisite before a marriage license mentioned, to his or her intended marriage
can be obtained by him or her (STA.MARIA, child or ward, who is at (FAMILY CODE, Art.
supra at 157). least 18 years old and 15).
below 21 years of age,
A marriage license is required in order to notify before obtaining a While it is not an
the public that two persons are about to be marriage license essential nor a formal
united in matrimony and that anyone who is (STA.MARIA, supra at requisite, it is a vehicle
aware or has the knowledge of any impediment 150). to induce further and
to the union of the two shall make it known to more mature
the local civil registrar (Niñal v. Bayadog, G.R. deliberation over the
No. 133778, March 14, 2000). decision to get
married (Minutes of
DUTY OF THE SOLEMNIZING OFFICER the 185th Meeting of
The solemnizing officer is not duty bound to the Civil Code and
investigate whether the marriage license was Family Law
regularly issued. He must only determine if it was committees, June 27,
issued by a competent official (Alcantara v. 1987, supra at 6).
Alcantara, G.R. No. 167746, August 28, 2007).
As to Effect of Absence
DUTIES OF THE SOLEMNIZING OFFICER WHEN
MARRIAGE LICENSE NOT REQUIRED Absence of parental Absence of parental
a. In cases of marriage in articulo mortis and consent renders the advice does not affect
marriage in remote places, the solemnizing marriage voidable the validity of the
officer must: (FAMILY CODE, Art. 45). marriage
i. State in an affidavit executed beforethe (STA.MARIA, supra at
LCR or any person authorized to 153).
administer oaths that the marriage was
performed in articulo mortis or that the However, the
residence of either party, specifying the marriage license shall
barrio or barangay, is so located that not be issued until
there is no means of transportation to after three months

PARENTAL CONSENT PARENTAL ADVICE
following the
completion of the
publication of the
application therefor
(FAMILY CODE, Art.
15).
Marriage Counseling
This is a new requirement for the issuance of a
marriage license under the Family Code in cases
where the parties need parental consent or parental
advice. This is to enable the parties to find out if they
are compatible before they get married. The lack of
the certificate of marriage counseling has the same
effect as the lack of parental advice (SEMPIO-DIY,
supra at 21; FAMILY CODE, Art. 16).
RULES ON THE VALIDITY OF LICENSE
a. The license shall be valid in any part of the
Philippines;
b. Valid for a period of one hundred (120) days
from the date of issue;
c. It shall be deemed automatically cancelled upon
the expiration of said period if the contracting
parties have not made use of it; and
d. Said expiry date shall be stamped in bold
characters on the face of every license issued
(FAMILY CODE, Art. 20).
NOTE: Even if the license is obtained elsewhere,
not in the local civil registrar of the city or municipality
where either contracting party habitually resides, the
validity of the marriage is not affected since this is a
mere irregularity in the issuance of the said license
(RABUYA, supra at 218).
To be considered void on the ground of absence of
a marriage license, the law requires that the absence
of such marriage license must be apparent on the
marriage contract, or at the very least, supported by
a certification from the local civil registrar that no
such marriage license was issued to the parties
(Alcantara v. Alcantara, G.R. No. 167746, August
28, 2007; Kho v. Republic, G.R. No. 187462, June
1, 2016).
Solemnization of a Marriage Involving a Foreign
Contracting Party in the Philippines
When either or both parties are foreign citizens, they
must first submit a certificate of legal capacity to
marry issued by their diplomatic/consular officials
before marriage license can be obtained (FAMILY
CODE, Art. 21).
A certificate of legal capacity is necessary because
the Philippines, insofar as marriage is concerned,
adheres to the national law of the contracting parties
with respect to their legal capacity to contract
marriage. Without this certification of legal capacity,
the LCR will not issue the marriage license
(STA.MARIA, supra at 157).
NOTE: If without the certificate of legal capacity, the
marriage license was nevertheless issued, the
marriage celebrated on the basis of such marriage
license will still be considered valid as this is merely
an irregularity in complying with a formal
requirement of the law in procuring a marriage
license (Garcia v. Recio, G.R. No. 138322, October
2, 2001; FAMILY CODE, Art. 4).
The capacity of a foreigner to get marriedin the
Philippines is governed by hisnational law, a foreign
law, thus, government offices and courts cannot take
judicial notice of said law (SEMPIO – DIY, supra at
26).
Stateless Persons or Refugees
Stateless persons or refugees from othercountries
shall submit an affidavit stating circumstances to
show capacity to contract marriage before a
marriage license can be obtained (FAMILY CODE,
Art. 21, par. 2).
EXCEPTIONS TO THE LICENSE REQUIREMENT:
(ARMZ-5)
1. Marriage in Articulo mortis between passengers
or crew members may be solemnized by a ship
captain or by an airplane pilot not only while the
ship is at sea or the plane is in flight, but also
during stopovers at ports of call (FAMILY CODE,
Art. 31);
2. In Remote place
– residence of either party is so located that
there is no means of transportation to enable
them to personally appear before the LCR
(FAMILY CODE Art. 28);
3. Among Muslims or members of ethnic cultural
communities solemnized in accordance with
their customs, rites, or practices (FAMILY
CODE, Art. 33);
4. Marriage in articulo mortis between persons
within the Zone of military operation, whether
members of the armed forces or civilians may be
solemnized by a military commander of a unit,
who is a commissioned officer (FAMILY CODE,
Art. 32);
5. Marriage between a man and a woman who
have lived together as husband and wife for at
least five (5) years and without legal impediment
to marry each other(FAMILY CODE, Art. 34).
 Requisites: (5-NPAS)
a. The man and woman must have been living
as husband and wife for at least 5 years
before the marriage;
b. The parties must have No legal impediment
to marry each other;
c. The fact of absence of legal impediment
between the parties must be Present at the
time of marriage;
d. The parties must execute an Affidavit before
any person authorized by law to administer
oaths stating that they have lived together
for at least 5 years (and are without legal
impediment to marry each other); and
e. The solemnizing officer must execute a
Sworn statement that he had
ascertained the qualifications of the
parties and that he had found no legal
impediment to their marriage (Borja-
Manzano v. Sanchez, A.M. No. MTJ–
00–1329, March 8, 2001).
NOTE: The solemnizing officer is duty bound to
ascertain the qualifications of the contracting parties
(STA. MARIA, supra at 121).
COMPUTATION OF 5–YEAR COHABITATION
PERIOD
The 5–year period should be computed on thebasis
of cohabitation as husband and wifewhere the only
missing factor is the marriagecontract to validate
the union (e.g. if both cohabited at the age of 17,
counting startswhen parties reach 18 years old as
suggested in the case of OCA vs Judge Necessario,
A.M. MTJ07-1691, April 2, 2013).
This 5–year period should be the years immediately
before the day of the marriage and it should be a
period of cohabitation characterized by:
1. Exclusivity
– no legal impediment was present at any time
within the 5 years; and
2. Continuity
– that is unbroken (Republic v. Dayot, G.R. No.
175581, March 28, 2008; Niñal v. Bayadog, G.R.
No. 133778, March 14, 2000).
NOTE: The five-year common-law cohabitation
period under Article 76 means a five-year period
computed back from the date of celebration of
marriage, and refers to a periodof legal union had
it not been for the absenceof a marriage. It covers
the years immediately preceding the day of the
marriage, characterized by exclusivity — meaning
no third party was involved at any time within the five
years — and continuity that is unbroken (Republic v.
Dayot, G.R. No. 175581, March28, 2008).
The falsity of an affidavit of marital cohabitation,
where the parties have in truth fallen short of the
minimum five-year requirement, effectively renders
the marriage void ab initio for lack of a marriage
license (Republic v. Dayot, G.R. No. 175581, March
28, 2008).
Marriage Certificate
Best documentary evidence of the existence of a
marriage (Tenebro v. CA, G.R. No. 150758,
February 18, 2004; FAMILY CODE, Art. 22).
NOTE: The mere fact that no record of the marriage
exists in the registry of marriage does not invalidate
said marriage, as long as in the celebration thereof,
all requisites for its validity are present (People v.
Borromeo, G.R. No. 61873, October 31, 1984).
Photostat Copy of Marriage Certificate
A mere photostat copy of a marriage certificate is a
worthless piece of paper (Vda. De Chua v. CA, G.R.
No. 116835, March 5, 1998) but if such photostat
copy emanated from the Office of the Local Civil
Registrar and duly certified by the LCR as an
authentic copy of the records in his office, such
certified photostat copy is admissible as
evidence (STA.MARIA, supra at 160).
NOTE: If the photostat copies, though not certified
by the Office of the Local Civil Registrar, are
presented in court without objection from the
opposing parties and consequently admitted by the
court, the said photostat copies are deemed
sufficient proof of the facts contained therein and
therefore canbe proof of marriage (Sy v. Court of
Appeals, G.R. No. 127263, April 12, 2000).
Testimonial Evidence
Testimony of one of the parties to the marriage,
witnesses or solemnizing officer is admissibleto
prove the fact of marriage (People v.Velasco, G.R.
Nos. 135231-33, February 28,
2001).
Cohabitation as Insufficient Proof
Mere cohabitation is not a direct proof of marriage,
and it must be proved by proper documents or by
oral testimony in case they have been lost (STA.
MARIA, supra at 164, citing US v. Evangelista, G.R.
No. 9841,January 9, 1915).
PRESUMPTION OF MARRIAGE
A man and a woman deporting themselves as
husband and wife are presumed to have entered into
a lawful contract of marriage (RULES OF COURT,
RULE 131, Sec. 3 (aa)).
Semper praesumitur pro matrimonio — Always
presume marriage. However, this presumption may
be contradicted by a party and overcome by other
evidence (Uy v. Sps. Lacsamana, G.R. No. 206220, MARRIAGE LICENSE V.
August 19, 2015). MARRIAGE CONTRACT
REASON: Marriage in this jurisdiction is not only a MARRIAGE MARRIAGE
civil contract, but it is a new relation, an institution in LICENSE CONTRACT
the maintenance of which the public is deeply
interested. Every intendment of the law leans As to Necessity
towards legalizing matrimony.
Formal requisite. Not essential for the
Persons dwelling together in apparent matrimony validity of the marriage.
are presumed, in the absence of counter-
As to Effect of Absence
presumption or evidence special to the case, to be
in fact married. The reason is that such is the Absence renders Best evidence to prove
common order of society, and if the parties were not marriage void ab initio existence (not validity)
what they thus holdthemselves out as being, they except in the cases of marriage.
would be living inthe constant violation of decency provided under Arts.
and of law. Once a man and a woman have lived as 27 to 34.
husband and wife and such relationship is not
denied nor contradicted, the presumption of their As to Issuing Authority
being married must be admitted as a fact (Adong v.
Cheong Seng Gee, G.R. No. L- 18081, March 3, Issued by the Issued by the person
1922; Alavado v. City Government of Tacloban, G.R. LCR (FAMILY CODE, solemnizing the
No. L-49084,October 10, 1985; Vda. de Avenido v. Art. 19). marriage (FAMILY
Avenido, G.R. No. 173540, January 22, 2014). CODE, Art. 23).

Effect of Presumption of Marriage As to Time Issued

Once the presumption of marriage arises, other
evidence may be presented in support thereof. The
evidence need not necessarily or directly establish
the marriage but must at least be enough to
strengthen the presumption of marriage. Every
intendment of law leans towardlegitimizing marriage
(Delgado vda. de De la Rosa v. Heirs of Marciana
vda. de Damian, G.R. No. 155733, January 27,
2006).
Competent Evidence to Prove Marriage
The Supreme Court ruled in Trinidad v. CA, G.R.
No. 118904, April 20, 1998, that when the
question of whether a marriage has been
contracted arises inlitigation, said marriage may
be proven by relevant evidence. To prove the
fact of marriage, the following would constitute
competent evidence:
1. The testimony of a witness to the matrimony;
2. The couple’s public and open cohabitation as
husband and wife after the alleged wedlock;
3. The birth and the baptismal certificates of
children born during such union; and
4. The mention of such nuptial in subsequent
documents (Trinidad v. CA, supra).
5. A solemn statement in the will of a deceased as
to the fact of his marriage is also admissible
proof of such marriage (Son Cui v. Guepangco
y Lim, G.R. No. 6163, March 14, 1912).
Issued before the Issued after the
marriage. marriage.
C. MARRIAGE CEREMONY
No prescribed form or religious rite for solemnization
of marriage is required (FAMILY CODE, Art. 6).
It is not sufficient that the parties enter into an
agreement “that they take each other as husband
and wife” or that consent be given. Article 2(2) of the
Family Code requires that such consent must be
given “in the presence of the solemnizing officer”
(RABUYA, supra at 186-187).
Absence of Two Witnesses
The absence of 2 witnesses of legal age is merely
an irregularity but the party responsible for the
irregularity shall be civilly, criminally, and
administratively liable (FAMILY CODE, Art. 4).
Marriages by Proxy
a. If it was solemnized in the Philippines, the
marriage is VOID because physical appearance
is required under Art. 6;
b. If performed abroad, whether betweenFilipinos
or foreigners or mixed, the controlling article is
Art. 26 of the Family Code.(1 PARAS, supra at
347).
NOTE: The mere private act of signing a marriage
contract bears no semblance to a valid marriage and
thus, needs no judicial declaration of nullity. Such act
alone, without more, cannot be deemed toconstitute
an ostensibly valid marriage for which petitioner
might be held liable for bigamy unless he first
secures a judicial declaration of nullity before he
contracts a subsequent marriage (Morigo y Cacho v.
People, G.R. No. 145226, February 6, 2004).
MARRIAGE
CELEBRATED OUTSIDE
THE PHILIPPINES
(ART. 26)
VALIDITY OF MARRIAGE
GENERAL RULE: Marriages contracted outside the
Philippines in accordance with the laws in force in
the country where they were solemnized are valid
in this country (FAMILY CODE, Art. 26, Par. 1).
In case a Filipino contracts a foreign marriage which
is null and void in the place where it was solemnized,
the same shall also be null and void in the
Philippines even if such was valid if celebrated under
Philippine laws.
NOTE: The rule on the validity of foreign marriages
under Art. 26 applies only to Filipinos (SEMPIO-
DIY, supra at 29).
FOREIGN MARRIAGES, EVEN IF VALID
WHERE SOLEMNIZED, SHALL NOT BE
VALID IN THE PHILIPPINES IF:
(BIMBAP2)
1. Contracted by a national who is Below 18 years
of age (no legal capacity to contract marriage)
(FAMILY CODE, Art. 35 (1));
REASON: The Philippines adheres to the rule
that the marrying capacity of the contracting
parties is governed by the national law of that
party, which is the Philippine Law (STA.MARIA,
supra at 169).
2. Incestuous marriages (FAMILY CODE, Art. 37);
3. Contracted through Mistake of one party as to
the identity of the other (FAMILY CODE, Art. 35
(5));
4. Bigamous or polygamous except as provided in
Art. 41 (FAMILY CODE, Art. 35 (4));
5. Contracted following the Annulment or
declaration of nullity of a previous marriage but
before the requirement of recording under
Article 52 (FAMILY CODE, Art.35 (6));
6. When any party is Psychologically incapacitated
when the marriage was celebrated (FAMILY
CODE, Art. 36); and
7. Marriage is void by reason of Public policy
(FAMILY CODE, Art. 38).
NOTE: Common-law marriages obtained abroad by
Filipinos are not valid in the Philippines
(STA.MARIA, supra at 172).
COURT CANNOT TAKE JUDICIAL
NOTICE OF FOREIGN LAW
It is necessary to prove the foreign law as a question
of fact and then to prove the celebration ofmarriage
pursuant thereto by
(STA.MARIA, supra at 177).
convincing evidence
Philippine courts cannot take judicial notice of
foreign laws. Like any other facts, they must be
alleged and proved. Australian marital laws are not
among those matters that judges are supposed to
know by reason of their judicial function. The power
of judicial notice must be exercised with caution, and
every reasonable doubt upon the subject should be
resolved in the negative (Garcia v. Recio , G.R. No.
138322, October 2, 2001).
SAME SEX MARRIAGE OF FILIPINOS
ABROAD
It is invalid. The Family Code mandates that only a
male and a female can marry each other. This is,
therefore, a public policy matter which cannot be
rendered ineffective by any foreign law(STA.MARIA,
supra at 176-177; FAMILY CODE, Art. 2(1); CIVIL
CODE, Arts.15 and 17).
DIVORCE
GENERAL RULE: Divorce is not allowed in the
Philippines (Cang v. Court of Appeals, G.R. No.
105308, September 25, 1998).
EXCEPTIONS:
1. Between 2 aliens – if valid in their national laws
even if marriage was celebrated in the
Philippines; and
2. Between a Filipino and an alien – if:
a. There is a valid marriage celebrated
between a Filipino citizen and a foreigner;
and
b. A valid divorce according to the national law
of the foreigner is obtained abroad by the
alien spouse capacitating him or her to
remarry (FAMILY CODE, Art. 26, Par. 2 as
amended by E.O. No. 227 (1987)); and
c. At the time of the divorce, one is a Filipino
and the other is a Foreigner.
A FOREIGN DIVORCE SECURED BY A
FILIPINO AGAINST A FOREIGN SPOUSE
IS RECOGNIZED IN THE PHILIPPINES
A Filipino citizen has the capacity to remarry under
Philippine law after initiating a divorce proceeding
abroad and obtaining a favorable judgment against
his or her alien spouse who is capacitated to remarry
(Republic v. Manalo, G.R. No. 221029, April 24,
2018).
NOTE: The purpose of Paragraph 2 of Article
26 is to avoid the absurd situation where the
Filipino spouse remains married to the alien
spouse who, after a foreign divorce decree that
is effective in the country where it was
rendered, is no longer married to the Filipino
spouse. The provision is a corrective measure
to address an anomaly where the Filipino
spouse is tied to the marriage while the foreign
spouse is free to marry under the laws of his or
her country (Republic v. Manalo, G.R. No.
221029, April 24, 2018).
Whether the Filipino spouse initiated the foreign
divorce proceeding or not, a favorable decree
dissolving the marriage bond and capacitating his
or her alien spouse to remarry will have the same
result: the Filipino spouse will effectively be without
a husband or wife. A Filipino who initiated a foreign
divorce proceeding is in the same place and in "like
circumstance as a Filipino who is at the receiving
end of an alien-initiated proceeding. Therefore, the
subject provision should not make a distinction. In
both instances, it is extended as a means to
recognize the residual effect of the foreign divorce
decree on Filipinos whose marital ties to their alien
spouses are severed by operation of the latter's
national law (Republic v. Manalo, G.R. No. 221029,
April 24, 2018).
A foreign divorce may be recognized in this
jurisdiction as long as it is validly obtained,
regardless of who among the spouses initiated the
divorce proceedings (Racho v. Tanaka, G.R. No.
199515, June 25, 2018).
Foreign divorce decrees obtained to nullify
marriages between a Filipino and an alien citizen
may already be recognized in this jurisdiction,
regardless of who between the spouses initiatedthe
divorce; provided, of course, that the party
petitioning for the recognition of such foreign divorce
decree — presumably the Filipino citizen — must
prove the divorce as a fact and demonstrate its
conformity to the foreign law allowing it
(Morisono v. Morisono, G.R. No. 226013, July 2,
2018).
NON-APPLICABILITY OF A.M. NO. 02-11-
10-SC
The provisions of A.M. No. 02-11-10-SC (Proposed
Rule on Declaration of Absolute Nullity of Void
Marriages and Annulment of Voidable
Marriages) do not apply in a case involving
recognition of a foreign decree of divorce. A decree
of absolute divorce procured abroad is different from
annulment as defined by our family laws. A.M. No.
02-11-10-SC only covers void and voidable
marriages that are specifically cited and enumerated
in the Family Code of the Philippines (Republic v.
Cote, G.R. No. 212860, March 14, 2018).
PROOF OF DIVORCE
Party pleading it must prove divorce as a fact and
demonstrate its conformity to the foreign law
allowing it, which must be proved as courts cannot
take judicial notice of foreign laws. If a valid divorce
decree has been obtained abroad, there is no more
need to file an action to nullify the marriage (Felicitas
Amor-Catalan v. CA, G.R. No. 167109, February 6,
2007).
RULES OF COURT WILL GOVERN
RECOGNITION OF FOREIGN
JUDGMENT DECLARING A MARRIAGE
VOID
Philippine courts will only determine:
1. Whether the foreign judgment is inconsistent
with an overriding public policy in the Philippines
and;
2. Whether any alleging party is able to prove an
extrinsic ground to repel the foreign judgment,
i.e., want of jurisdiction, want of notice to the
party,collusion, fraud, or clear mistake of law or
fact (Fujiki v. Marinay, G.R. No. 196049, June
26, 2013).
CAPACITY OF THE FOREIGNER
SPOUSE TO REMARRY MUST BE
STATED IN THE DECREE OF DIVORCE
There must be a showing that the divorce decree
gave the foreigner spouse legal capacity to remarry
because in some jurisdictions, remarriage may be
limited or prohibited (Garcia v. Recio, G.R. No.
138322, October 2, 2001).
ARTICLE 26 (2) PROVIDES A REMEDY
ONLY TO FILIPINOS BUT NOT TO
FOREIGNERS
The legislative intent is for the benefit of the Filipino
spouse, by clarifying his or her marital status,
settling the doubts created by the divorce decree.
Essentially, Art. 26 (2) of the Family Code provided
the Filipino spouse a substantive right to have his or
her marriage to the alien spouse considered as
dissolved, capacitating him or her to remarry
(Corpuz v. Sto. Tomas, G.R. No. 186571, August 11,
2010).
VOID MARRIAGES
(ART. 35)
VOID MARRIAGE
A void marriage is that which is not valid from its
inception (STA.MARIA, supra at 206).
A marriage that is void ab initio is considered as
having never to have taken place and cannot be
the source of rights. It can never be ratified (Niñal v.
Bayadog, G.R. No. 133778, March 14, 2000).
RTC HAS EXCLUSIVE JURISDICTION IN
ALL ACTIONS INVOLVING THE
CONTRACT OF MARRIAGE
RTC has jurisdiction to rule on the validity of
marriage solemnized and celebrated by the Church
pursuant to the provision of the Family Code.
Although, marriage is considered a sacrament inthe
Catholic Church, it has civil and legal consequences
which are governed by the Family Code. As
petitioner correctly pointed out, the instant petition
only seeks to nullify the marriage contract between
the parties as postulated in the Family Code of the
Philippines; and the declaration of nullity of the
parties' marriage in the religious and ecclesiastical
aspect is another matter. Notably, the proceedings
for church annulment which is in accordance with the
norms of Canon Law is not binding upon the State
as the couple is still considered married to each
other in the eyes of the civil law. Thus, the principle
of separation of the church and state finds no
application in this case (Tilar v. Tilar, G.R. No.
214529, July 12, 2017).
KINDS OF VOID MARRIAGES (APICS):
1. Absence of essential or formal requisites;
2. Either of the parties is
Psychologically incapacitated;
3. Incestuous marriages; and
4. Contrary to public policy;
5. Void Subsequent marriages
GENERAL RULE: Good faith and bad faith are
immaterial in determining whether or not a marriage
is null and void. The party who knew that he or she
was entering a void marriage before its
solemnization may be held liable for damages by the
other contracting party under Arts. 19, 20 and 21
of the Civil Code.
NOTE: This means that the nullity of a marriage can
be asserted even if it is not the main or principal
issue of a case. No previous judicial declaration of
nullity is required by law with respect to any other
matter where the issue of the voidness of a marriage
is pertinent or material, either directly or indirectly
(STA.MARIA, supra at 211).
EXCEPTIONS:
1. Art. 35 (2): Either of the contracting parties is in
good faith in believing that the solemnizing
officer has authority although he has none in
fact; and
2. Art. 41: A person whose spouse disappears for
4 consecutive years, or two years where there
was danger of death, the present spouse may
validly marry again if he or she:
a. Has a well-founded belief that his or her
spouse is dead;
b. Procures a judicial declaration of
presumptive death; and
c. At the time of the subsequent marriage
ceremony, is in good faith.
In these two cases, the good faith even of only one
of the contracting parties shall make the marriage
valid. To be void, both of the contracting parties must
be in bad faith (FAMILY CODE, Art. 44; STA.
MARIA, supra at 210).
IMPRESCRIPTIBILITY OF ACTION FOR
DECLARATION OF NULLITY
The action or defense for the declaration of absolute
nullity of a marriage shall not prescribe (FAMILY
CODE, Art. 39, as amended by R.A. No. 8533).
ONLY THE SPOUSES CAN FILE
PETITION FOR DECLARATION OF
NULLITY
Pursuant to A.M. No. 02-11-10-SC (SC Resolution
which took effect on March 15, 2003), a petition for
declaration of absolute nullity of void marriage may
be filed solely by the husband or the wife. Thus,
compulsory or intestate heirs can question the
validity of the marriage of the spouses, not in a
proceeding for declaration of nullity, but upon the
death of a spouse in a proceeding for the settlement
of the estate of the deceased spouse filed in the
regular courts (Enrico v. Heirs of Medinaceli, G.R.
No. 173614, September 28,
2007).
EXCEPTION: Cases for nullity of marriage
solemnized PRIOR to the Family Code and actions
commenced PRIOR to March 15, 2003 by persons
other than the husband and wife (Carlos v.
Sandoval, G.R. No. 179922, December 16, 2008).
DECLARATION OF NULLITY NOT A
PREJUDICIAL QUESTION
The pendency of the civil action for nullity of the first
marriage does not pose a prejudicial question in a
criminal case for concubinage (Beltran v. People,
G.R. No. 137567, June 20, 2000). By analogy, this
ruling applies in a case for bigamy since both crimes
presuppose the subsistence of a marriage (Bobis v.
Bobis, G.R. No.138509, July 31,2000).
Respondent cannot be permitted to use his own
malfeasance to defeat the criminal action against
him when it was respondent’s clear intent to obtain
a judicial declaration of nullity of his first marriage
and thereafter to invoke that very same judgment to
prevent his prosecution for bigamy. He cannot have
his cake and eat it too. Otherwise, all that an
adventurous bigamist has to do is to disregard Art.
40 of the Family Code, contract a subsequent
marriage and escape a bigamy charge by simply
claiming that the first marriage is void and that the
subsequent marriage is equally void for lack of a
prior declaration of nullity of the first (Bobis v. Bobis,
G.R. No.138509, July 31, 2000).
ATTACKING A VOID MARRIAGE
GENERAL RULE: A void marriage can be attacked
collaterally (STA. MARIA, supra at 192).
NOTE: In a case for concubinage, the accused need
not present a final judgment declaring his marriage
void, for he can adduce evidence in the criminal case
of the nullity of his marriage other than proofof a
final judgment declaring his marriage void (Beltran
v. People, G.R. No. 137567, June 20, 2000).
EXCEPTIONS:
Direct attack, not a collateral attack, on the nullity of
a marriage must first be undertaken when:
1. A person in a void marriage wants to remarry;in
such circumstance, he must first file a civil case
to obtain a judicial declaration of nullity of the
first marriage (FAMILY CODE, Art. 40);
2. If a donor desires to revoke a donation propter
nuptias (in consideration of the marriage) given
to one or both the spouses on the ground that
the marriage is void (FAMILY CODE, Art. 50 in
relation to Arts. 43, par. 3 and 86, par. 1).
JUDICIAL DECLARATION OF NULLITY
The absolute nullity of a previous marriage may be
invoked for purposes of remarriage on the basis
solely of a final judgment declaring such previous
marriage void (FAMILY CODE, Art. 40).
NOTE: Other than for purposes of remarriage, no
judicial action is necessary to declare a marriage an
absolute nullity. For other purposes, such as but not
limited to determination of heirship, legitimacy or
illegitimacy of a child, settlement of estate,
dissolution of property regime, or a criminal case
for that matter, the court may pass upon the validity
of marriage even in a suit not directly instituted to
question the same so long as it is essential to the
determination of the case. (Niñal v. Bayadog, G.R.
No. 133778, March 14, 2000).
REASON: Parties to a marriage should not be
permitted to judge for themselves its nullity, only
competent courts having such authority. Prior tosuch
declaration of nullity, the validity of the first marriage
is beyond question (Montañez v. Cipriano,G.R. No.
181089, October 22, 2012).
GUILTY OF BIGAMY
Elements of Bigamy: (LDCE)
1. The offender has been Legally married.
2. The marriage has not been legally Dissolved or
in case his or her spouse is absent, the absent
spouse could not yet be presumed dead
according to the Civil Code.
3. The offender Contracts a second or subsequent
marriage; and
4. The second or subsequent marriage has all the
Essential requisites for validity (2 REYES, The
Revised Penal Code (2012), p. 972).
GENERAL RULE: One who enters into a
subsequent marriage without first obtaining such
judicial declaration is guilty of bigamy. This principle
applies even if the earlier union is characterized by
statute as “void” (Manuel v. People, G.R. No.
165842, November 29, 2005).
The requirement for a declaration of absolute nullity
of a marriage is also for the protection of the spouse
who, believing that his or her marriage is illegal and
void, marries again. With the judicial declaration of
the nullity of his or her marriage, the person who
marries again cannot be charged with bigamy. A
judicial declaration of nullity is required before a valid
subsequent marriage can be contracted; or else,
what transpires is a bigamous marriage,
reprehensible and immoral (Teves v. People, G.R.
No.188775, August 24, 2011; Iwasawa v. Gangan,
G.R. No. 204169, September 11, 2013).
EXCEPTION: A judicial declaration of nullity is
not needed where no marriage ceremony at all
was performed by a duly authorized solemnizing
officer, as where the parties merely signed a
marriage contract on their own without the presence
of the solemnizing officer (Morigo v. People, G.R.
No. 145226, February 6, 2004).
(N.B. In Pulido v. People, G.R. No. 220149, July 27,
2021, the Supreme Court En Banc ruled that the
accused in a bigamy case can collaterally attack the
validity of a prior void marriage in the same criminal
proceedings for bigamy. No need to obtain a judicial
declaration of absolute nullity in order to raise it as a
defense in a bigamy case.)
Note: According to Bar Bulletin No. 15, S. 2020, this
ruling is not covered by the 2020/2021 Bar because
the scope and cutoff of canonical jurisprudential
doctrines shall be until September 30, 2020 only.
1. VOID MARRIAGES DUE TO
ABSENCE OF ANY OF THE
ESSENTIAL OR FORMAL
REQUISITES (FAMILY CODE, ART.
35): (18-ALBI-53)
a. Those contracted by any party below eighteen
(18) years of age even with the consent of
parents or guardians;
b. Those solemnized by any person not legally
Authorized to perform marriages unless such
marriages were contracted with either or both
parties believing in good faith that the
solemnizing officer had the legal authority to do
so;
c. Those solemnized without License, except
those covered by the preceding Chapter;
d. Those Bigamous or polygamous marriages
not failing under Article 41;
e. Those contracted through mistake of one
contracting party as to the Identity of the other;
and
f. Those subsequent marriages that are void
under Article 53 (FAMILY CODE, Art. 35).
GENERAL RULE: A marriage contracted by any
person during the subsistence of a previous valid
marriage shall be null and void (FAMILY CODE, Art.
41; Gomez v. Lipana, G.R. No. L– 23214, June 30,
1970; Republic v. Narceda,
G.R. No. 182760, April 10, 2013).
EXCEPTION: Before the celebration of the
subsequent marriage, a declaration of presumptive
death may be obtained after complying with the
following requirements:(SAB)
a. Present spouse must file a Summaryproceeding
for the declaration of the presumptive death of
the absentee without prejudice to the latter’s
reappearance;
b. Absence of the other spouse must have been
for 4 consecutive years, or 2 years where there
was danger of death under circumstances laid
down in Art. 391 of the NCC; and
c. Well-founded Belief of the present spouse who
wishes to remarry that absent spouse is already
dead (FAMILY CODE, Art. 41).
NOTE: The well-founded belief in the absentee’s
death requires the present spouse to prove that
his/her belief was the result of diligent and
reasonable efforts to locate the absent spouse and
that based on these efforts and inquiries, he/she
believes that under the circumstances, the absent
spouse is already dead. It necessitates exertion of
active effort, not a passive one (Republic v. Cantor,
G.R. No. 184621, December 10, 2013; Republic v.
Tampus, G.R. No. 214243, March 16, 2016).
REASON: This is intended to protect the present
spouse from criminal prosecution for bigamy under
Art. 349 of the Revised Penal Code. However, if the
bigamous marriage was committed abroad, the
guilty party cannot be criminally prosecuted for
bigamy in the Philippines as our penal statutes are
territorial in nature (STA.MARIA, supra at 375).
If both spouses of the subsequent marriage acted in
bad faith, said marriage shall be void ab initio and all
donations made by one in favor of the other are
revoked by operation of law (FAMILY CODE, Art.
44).
Effect of Reappearance of Absent Spouse
The subsequent bigamous marriage under Art. 41 of
the Family Code remains valid despite
reappearance of theabsentee spouse.
Subsequent marriage is automatically terminated if
the reappearance was recorded in a sworn
statement in the civil registry of the residence of the
parties to the subsequent marriage at the instance
of any interested person with due notice to said
spouses, without prejudice to the fact of
reappearance being judicially determined in case
such fact is disputed (FAMILY CODE, Art.42).
The subsequent marriage still subsists in the
following:
a. If the first marriage has already been annulled
or has been declared a nullity (FAMILY CODE,
Art.42, par. 2);
b. If the sworn statement of the reappearanceis not
recorded in the civil registry of the subsequent
spouses' residence;
c. If there is no notice to the subsequent spouses;
or
d. If the fact of reappearance is disputed in the
proper courts of law, and no judgmentis yet
rendered confirming such fact of reappearance
(Santos v. Santos, G.R. No. 187061, October 8,
2014).
NOTE: If the absentee reappears, but no step is
taken to terminate the subsequent marriage either
by affidavit or by court action, the absentee’s mere
reappearance even if made known to the spouses
in the subsequent marriage will not terminate such
marriage (SSS v. Bailon, G.R. No. 165545, March
24, 2006).
Declaration of presumptive death immediately
executory
By express provision, the judgment of the court in a
summary proceeding declaring presumptive death
shall be immediately final and executory (FAMILY
CODE, Art. 247). Therefore, since the judgment is
immediately final and executory, appeal is not an
available remedy. An aggrieved party may file a
petition for certiorari to question abuse of discretion
amounting to lack of jurisdiction. Such petition
should be filed in the Court of Appeals in accordance
with the Doctrine of Hierarchy of Courts (Republic v.
Tango, G.R. No. 161062, July 31, 2009).
2. PSYCHOLOGICAL INCAPACITY
A malady that is so grave and permanent as to
deprive one of awareness of the duties and
responsibilities of the matrimonial bond one is about
to assume (Del Rosario v. Del Rosario, G.R. No.
222541, February 15, 2017).
Psychological incapacity must refer to the most
serious cases of personality disorders clearly
demonstrative of an utter insensitivity or inability to
give meaning and significance to the marriage
(Republic v. De Gracia, G.R. No. 171557, February
12, 2014).
'Psychological incapacity,' as a ground to nullify a
marriage under Article 36 of the Family Code, should
refer to no less than a mental — not merely physical
— incapacity that causes a party to be truly
incognitive of the basic marital covenants that
concomitantly must be assumed and discharged by
the parties to the marriage which, as so expressed
in Article 68 of the Family Code, among others,
include their mutual obligations to live together,
observe love, respect and fidelity and render help
and support. (Espina-Dan v. Dan, G.R. No. 209031,
April 16, 2018)
Psychological incapacity is not a medical but a legal
concept. It refers to a personal condition that
prevents a spouse to comply with fundamental
marital obligations only in relation to a specific
partner that may exist at the timeof the marriage
but may have revealed through behavior
subsequent to the ceremonies. It need not be a
mental or personality disorder. It need not be a
permanent and incurable condition. Therefore, the
testimony of psychologist or psychiatrist is not
mandatory in all cases. The totality of the evidence
must show clear and convincing evidence to cause
the declaration of nullity of marriage (Tan-Andal v.
Andal, G.R.No. 196359, May 11, 2021).
Article 36 of the Family Code must not be confused
with a divorce law that cuts the marital bond at the
time the grounds for divorce manifest themselves;
rather, it must be limited to cases where there is a
downright incapacity or inability to assume and fulfill
the basic marital obligations, not a mere refusal,
neglect or difficulty, much less, ill will, on the part of
the errant spouse (Republic v. Romero II, G.R. Nos.
209180 & 209253, February 24, 2016).
Requisites of Psychological Incapacity: (GAI)
a. Gravity
– Must be grave/serious such that the party
would be incapable of carrying out the ordinary
duties required in a marriage;
b. Juridical Antecedence
– Must be rooted in the history of the party
antedating the marriage, although the overt
manifestations may emerge only after the
marriage; and
c. Incurability
– Must be incurable or, even if itwere otherwise,
the cure would be beyond the means of the party
involved (Espina- Dan v. Dan, G.R. No. 209031,
April 16,2018).
The Court ruled that THERE IS psychological
incapacity in the following instances:
a. A senseless, protracted, and constant refusal to
comply with the essential marital obligations by
one or both of the spouses although he, she, or
they are physically capable of performing such
obligations (Chi Ming Tsoi v. CA, G.R. No.
119190, January16, 1997);
b. A person who is unable to distinguish between
fantasy and reality would be unable to
comprehend the legal nature of the marital bond
much less its psychic meaning and the
obligations attached to the marriage, including
parenting. One unable to adhere to reality
cannot be expected to adhere as well to any
legal or emotional commitments (Antonio v.
Reyes, G.R. No. 155800, March 10, 2006);
c. A person who brings her children to her mahjong
sessions exposed them to gambling that erode
their moral fiber; hence, she is suffering from
psychological incapacity (Kalaw v. Fernandez,
G.R. No. 166357, January 14, 2015);
d. A person with paranoid personality disorder,
more severe than borderline and narcissistic
personality disorders, madehim distrustful and
prone to jealousy and paranoia so extreme and
severe that these caused him to poke a gun at
petitioner's head, and acts of depravity,
incapacitating him to fully comprehend and
assume the essential obligations of marriage
(Tani-De La Fuente v. De La Fuente, Jr., G.R.
No. 188400, March 8, 2017); and
e. Respondent Martin was diagnosed with
Narcissistic Personality Disorder, with
tendencies toward sadism. This adversely
affected Martin in such a manner that he formed
unrealistic values and standards on his own
 marriage and proposed unconventional sexual
practices. (Republic v. Javier, G.R. No. 210518,
April 18, 2018).
The Court ruled that THERE IS NO psychological
incapacity in the following instances:
a. The spouses’ disagreement on money matters
are common and even normal occurrences
between husbands and wives (Tongol v. Tongol,
G.R. No. 157610, October 19, 2007);
b. The spouses’ frequent squabbles and
respondent’s refusal to sleep with petitioner and
be supportive to him; and their bickering and
arguments even before their marriage and
respondent’s scandalous outbursts in public, at
most, show their immaturity, and immaturity
does not constitute psychological incapacity
(Navarro v. Cecilio-Navarro, G.R. No. 162049,
April 13, 2007);
c. The interpersonal problem with her co- workers
does not suffice to support the conclusion that
she was psychologically incapacitated to enter
into a marital union as they are poles apart from
their marital relationship. While both spring from
human relationship, their relatedness and
relevance to one another should be fully
established for them to be compared or to serve
as measures of comparison with one another
(Republic v. Encelan, G.R. No. 170022, January
9, 2013);
d. Sexual infidelity or perversion and abandonment
do not, by themselves, constitute grounds for
declaring a marriage void based on
psychological incapacity (Mallilin v.
Jamesolamin, G.R. No. 192718, February 18,
2015; see also Republic v. Tecag, G.R. No.
229272, November 19, 2018);
e. Emotional immaturity, irresponsibility, sexual
promiscuity, or other behavioral disorders, by
themselves, are nottantamount to psychological
incapacity (DelRosario v. Del Rosario, G.R. No.
222541, February 15, 2017);
f. Failings as husband and father are not
tantamount to psychological incapacity to
declare the marriage null and void. The intent of
the law has been to confine the meaning of
psychological incapacity tothe most serious
cases of personality disorders (Garlet v. Garlet,
G.R. No. 193544; August 2, 2017);
g. Mere showing of 'irreconcilable differences' and
'conflicting personalities' in no wise constitutes
psychological incapacity (Lontoc-Cruz v. Cruz,
G.R. No. 201988,October 11, 2017); and
h. Petitioner’s bare claim that respondent is a
pathological gambler, is irresponsible, and is
unable to keep a job, does not necessarily
translate into unassailable proof that
respondent is psychologically incapacitated to
perform the essential marital obligations
(Singson v. Singson, G.R. No. 210766, January
8, 2018).
i. Abandonment of the family does not
automatically justify a conclusion of
psychological incapacity under Article 36 of the
Family Code (Matudan v. Republic, G.R. No.
203284, November 14, 2016).
Award of Moral Damages
Petitioner is not entitled to moral damages based on
declaration of psychological incapacity because the
award of moral damages should be predicated, not
on the mere act of entering into the marriage, but on
specific evidence that it was done deliberately and
with malice by a party who had knowledge of his or
her disability and yet willfully concealed the same
(Buenaventura v. CA, G.R.No. 127358, March 31,
2005).
MOLINA DOCTRINE
Jurisprudential Guidelines: (PROBE-PIG)
a. Incapacity must be Permanent or incurable;
b. Root cause of the psychological incapacitymust
be:
i. Medically or clinically identified;
ii. Alleged in the complaint;
1.) Sufficiently proven by expert; and
2.) Clearly explained in the decision
c. Marital Obligations refer to Arts. 68–71, 220,
221 and 225 of the Family Code;
d. Plaintiff has Burden of proof;
e. Incapacity proven to be Existing at the timeof the
celebration of marriage;
f. Trial court must order the Prosecuting
attorney or fiscal and the Solicitor General
to appear for the state;
g. Interpretations of the National Appellate
Matrimonial Tribunal of the Catholic Church of
the Philippines while not controlling should be
given great respect; and
h. Illness is Grave enough to bring about disability
to assume essential marital obligations
(Republic v. CA and Molina, G.R. No. 108763,
February 13, 1997).
In ruling that the doctrine in Republic v. CA and
Molina (1997) was inapplicable, the Court declared
that cases of psychological incapacity should be
decided not on the basis of a priori assumptions,
predictions or generalizations but according to its
own facts. Courts should interpret the provision on a
case-to-case basis; guided by experience, the
findings of experts and researchers in psychological
disciplines, and by decisions of church tribunals.
While it was not suggesting the abandonment of the
Molina doctrine, it ruled that said doctrine has
become a strait-jacket, forcing all sizes to fitinto and
be bound by it, and in conveniently applying said
doctrine, has allowed diagnosed sociopaths,
schizophrenics, nymphomaniacs, narcissists and
the like, to continuously debase and pervert the
sanctity of marriage (Edward Kenneth Ngo Te v.
Rowena Ong Gutierrez Yu- Te, G.R. No. 161793,
February 13, 2009).
NOTE: There was no abandonment of the Molina
Guidelines, rather Ngo Te simply suggested the
relaxation of its stringent requirements (RABUYA,
Civil Law Reviewer (2017), p. 88 [hereinafter
RABUYA, Civil Law Reviewer]).
Weight of Expert Opinion
By the very nature of cases involving the application
of Article 36, it is logical and understandable to give
weight to the expert opinions furnished by
psychologists regarding the psychological
temperament of parties in order to determine the root
cause, juridical antecedence, gravity and incurability
of the psychological incapacity. However, such
opinions, while highly advisable, are not conditions
sine qua non in granting petitions for declaration of
nullity of marriage. At best, courts must treat such
opinions as decisive but not indispensable evidence
in determining the merits of a given case. In fact, if
the totality of evidence presented is enough to
sustain a finding of psychological incapacity, then
actual medical or psychological examination of the
person concerned need not be resorted to. The trial
court, as in any other given case presented before it,
must always base its decision not solely on the
expert opinions furnished by the parties but also on
the totality of evidence adduced in the course of the
proceedings (Mendoza v. Republic, G.R. No.
157649, November 12, 2012).
Alcoholism, Abuse, and Jealousy
Similarly, the husband’s alleged alcoholism,
drunkenness, his habitual verbal and physical abuse
of the wife, failure to support the latter and her
children, and unbearable jealousy, do not constitute
psychological incapacity (Republic v. Melgar, G.R.
No. 139676, March 31, 2006).
Totality of Evidence
Psychological incapacity may be established by the
totality of the evidence presented. The facts alleged
in the petition and the evidence presented,
considered in totality, should be sufficient to
convince the court of the psychological incapacity of
the party concerned (Republic v. Javier, G.R. No.
210518, April 18, 2018).
"What is important is the presence of evidence that
can adequately establish the party's psychological
condition." "The complete facts should allege the
physical manifestations, if any, as are indicative of
psychological incapacity at the time of the
celebration of the marriage" such that "If the totality
of evidence presented is enough to sustain a finding
of psychological incapacity, then actual medical
examination of the person concerned need not be
resorted to." (Espina-Dan v. Dan, G.R. No. 209031,
April 16, 2018).
While the Court has declared that there is no
requirement that the person to be declared
psychologically incapacitated should be personally
examined by a physician, much less be subjected to
psychological tests, this rule finds application only if
the totality of evidence presented is enough to
sustain a finding of psychological incapacity
(Bakunawa III v. Bakunawa, G.R. No. 217993
(Resolution),August 9, 2017).
Personal Examination by Physician NotRequired
for a Declaration of Psychological Incapacity
There is no requirement that the person sought to be
declared psychologically incapacitated should be
personally examined by a physician or psychologist
as a condition sine qua non to arrive at such
declaration. It can be proven by independent means
that one is psychologically incapacitated; there is no
reason why the same should not be credited
(Republic v. Tanyag-SanJose and San Jose, G.R.
No. 168328, February28, 2007).
However, "psychological incapacity" does not mean
to grasp "all such possible cases of psychoses."
The ponencia, citing Santos v. Court of Appeals,
reiterated that "psychological incapacity"
deliberately pertains to "the most serious cases of
personality disorders clearly demonstrative of an
utter insensitivity or inability to give meaning and
significance to the marriage." (Castillo v. Republic,
G.R. No. 214064, February 6, 2017).
The evidence need not necessarily come from the
allegedly incapacitated spouse, but can come from
persons intimately related to the spouses, i.e.
relatives and close friends, who could clearly testify
on the allegedly incapacitated spouse's condition at
or about the time of the marriage (Bakunawa v.
Reyes Bakunawa, G.R. No. 217993, August 9,
2017).
While the Court has consistently followed the
parameters in Republic v. Molina, these guidelines
are not meant to straightjacket all petitions for
declaration of nullity of marriage. The merits of each
case are determined on a case-to-case basis, as no
case is on all fours with another (Republic v. Javier,
G.R. No. 210518, April 18, 2018).
Applicability of Res Judicata
Final judgment denying a petition for nullity on the
ground of psychological incapacity bars a
subsequent petition for declaration of nullity on the
ground of lack of marriage license (Mallion
v. Alcantara, G.R. No. 141528, October 31, 2006).
Burden of Proof
In petitions for the declaration of nullity of marriage,
the burden of proof to show the nullity of marriage
lies with the plaintiff. Unless the evidence presented
clearly reveals a situation where the parties, or one
of them, could not have validly entered into a
marriage by reason of a grave and serious
psychological illness existing at the time it was
celebrated, we are compelled to uphold the
indissolubility of the marital tie (Republic v. Galang,
G.R. No. 168335, June 6, 2011).
Who may File Petition to Nullify Marriage onthe
Ground of Psychological Incapacity
Even the psychologically incapacitated can file the
action to declare the marriage void(SEMPIO – DIY,
supra at 47).
3. INCESTUOUS MARRIAGES,
WHETHER THE RELATIONSHIP IS
LEGITIMATE OR ILLEGITIMATE,
BETWEEN:
a. Ascendants & Descendants of any degree; and
b. Brothers & Sisters whether full or half-blood
(FAMILY CODE, Art. 37).
4. THOSE CONTRARY TO PUBLIC
POLICY CONTRACTED BETWEEN:
(COS-PAAS2A-K)
a. Collateral blood relatives whether legitimate or
illegitimate up to the 4th civil degree;
b. Step-parents & step children;
c. Parents-in-law & children-in-law;
d. Adopting parent & adopted child;
e. Adopted child & a legitimate child of the
adopter;
f. Surviving spouse of the adopting parent &the
adopted child;
g. Surviving spouse of the adopted child &
adopter;
h. Adopted children of the same adopter; and
i. Parties wherein one, with the intention to marry
the other, Killed the latter’s spouse, or his/her
spouse (FAMILY CODE, Art. 38).
NOTE: There is no need for conviction in a criminal
case of the guilty party. The fact of killing committed
by one of the parties to the marriage can be proved
in a civil case (STA.MARIA, supra at 254).
The following can now marry each other:
(LSG-CAC)
a. Brother–in–Law and sister–in–law;
b. Stepbrother and stepsister;
c. Guardian and ward;
d. Parties who have been Convicted of adultery or
concubinage; and
e. Adopted and illegitimate child, parents and
relatives by consanguinity or affinity of the
adopter (SEMPIO-DIY, supra at 45).
Determination if Two Persons are Relativesup
to the 4th Civil Degree:
a. Consider the nearest and immediate common
ascendant; and
b. Count the number of degrees from one of them
to the common ascendant and from the common
ascendant to the other one (STA.MARIA, supra
at 260).
Thus, a person (X) is 2 degrees removed from his
brother/sister, 3 from his uncle/aunt, who is the
brother/sister of his father/mother, 4 from his
cousin, and so forth (RABUYA, supra at345).
NOTE: Relationship by consanguinity is in itself
not capable of dissolution. Hence, the mere fact
that a common ascendant, a grandfather for
example, died does not sever the blood
relationship of first cousins (STA.MARIA, supra
at 244).
Views on Termination of Marriage on the“Affinity
Prohibition”
a. Relationship by affinity is not terminated by the
termination of the marriage whether there are
children or not in the marriage.
b. Relationship by affinity is dissolved if one of the
spouses dies and the spouses have no living
issues or children; it does not cease if there are
living issues or children of the marriage ‘in
whose veins the blood of the parties are
commingled, since the relationship of affinity
was continued through the medium of the issue
of marriage (STA.MARIA, supra at 266-268).
c. “Continuing affinity view” VOID MARRIAGE V. VOIDABLE
The Philippines follows the continuing affinity MARRIAGE
view, which means that the death of one spouse
does not terminate the relationship by affinity VOID VOIDABLE
regardless of whether or not there are children
produced under the marriage (Intestate Estate As to Nature
of Vda. Carungcong v. People, G.R. No.
Always void. Valid until annulled
181409, February 11, 2010).
(STA. MARIA, supra at
NOTE: The Continuing affinity view in Intestate 291).
Estate of Vda. Carungcong v. People is As to Susceptibility for Convalidation
discussed in light of the language and spirit of
Article 332(1) of the Revised Penal Code. Incapable of being Can be convalidated by
convalidated or free cohabitation or
5. VOID SUBSEQUENT MARRIAGES ratified (VITUG, prescription (VITUG, supra
a. Without judicial declaration of nullity of previous supra at 273). at 283).
void marriage (FAMILY CODE, Art. 40)
As to Impugnation
b. Without judicial declaration of presumptive
death of absent spouse (FAMILY CODE, Art. Can be attacked Can only be attacked
41) directly or through a direct action filed
collaterally in an in court.
NOTE: No judicial proceeding to annul a action filed or by way
subsequent marriage contracted under Art. 41 of defense.
is necessary. Also, the termination of the
As to Impugnation After Death of Either Party
subsequent marriage by affidavit provided for
in Art. 42 does not preclude the filing of an Can still be Can no longer beimpugned
action in court to prove the reappearance of the impugned even after after death of one of the
absentee and obtain adeclaration of dissolution death of parties parties.
or termination of the subsequent marriage
(SSS v. Vda. De Ballon, G.R. No. 165545, As to Property Relations
March 24, 2006).
Co–ownership of Generally Conjugal
c. Where the absent spouse was presumed dead, properties through Partnership or Absolute
and both the present spouse and would–be joint actual Community.
spouse were in bad faith in contracting marriage contributions except
(FAMILY CODE, Art. 44); and void marriage under
Art. 40
d. Failure to comply with Art. 52 requiring the
partition and distribution of properties and As to Liquidation of Property
delivery of children’s presumptive legitimes
which should be recorded in the appropriate Properties are Properties are liquidated in
civil registry and registry of property after liquidated in accordance with the rules
obtaining judgment for declaration of nullity or accordance with the provided under the
annulment (FAMILYCODE, Art. 53). ordinary rules of co- chapters in the absolute
ownership except community of property and
NOTE: Failure to record in the civil registry and void marriage under the conjugal partnership of
registry of property the judgment ofannulment or Art. 40 gains.
of absolute nullity of the marriage, partition and
As to Prescription
distribution of the property of the spouses and
the delivery of the children’s presumptive Action for Action prescribes.
legitimes shall not affect third persons (FAMILY declaration of nullity
CODE,Arts. 52–53). does not prescribe.

As to Decree Issued

Decree of nullity. Decree of annulment.

(See Comparative Chart on Effects of Declaration
of Nullity, Annulment and Termination of Marriage
in Art. 41 and Legal Separation).

VOIDABLE MARRIAGES
(ART. 45)
VOIDABLE MARRIAGES
A marriage is voidable if there is a defect in any of
its essential requisites (legal capacity and consent).
It is considered valid and produces all its civil effects
until it is set aside by final judgment of a competent
court in an action for annulment (RABUYA, supra at
448).
RATIFICATION/CONFIRMATION
Ratification or confirmation is the act by which a
person, entitled to bring an action for annulment,
with knowledge of the cause of annulment and after
it has ceased to exist, validates the contract either
expressly or impliedly (4 TOLENTINO,
Commentaries and Jurisprudence on the Civil Code
of the Philippines (1992), p. 600 [hereinafter 4
TOLENTINO]).
GROUNDS FOR ANNULMENT OF
VOIDABLE MARRIAGES
NOTE: Grounds must exist at the time of
marriage
(AUFFIS):
1. Absence of consent to contract marriage
from the parents, guardian or person
exercising substitute parental authority
(in that order) over one or both of the
parties between 18 years old to 21 years
old;
The marriage is ratified if the party whose parent
did not give consent, after reaching the age of
21 freely cohabits with the other and both lives
together as husband and wife(FAMILY CODE,
Art. 45, par. 1).
2. Unsound mind of either party;
The test is whether the party at the time of the
marriage was capable of understanding the
nature and consequences of the marriage (1
TOLENTINO, supra at 289).
The true test is whether the party concerned
could intelligently consent; that is, that he knew
what contract he was entering into (Hoadley v.
Hoadley, 244 N.Y. 424).
Presumption: A person is presumed to be of
sound mind at any particular time and the
condition is presumed to exist, in the absence
of proof to the contrary (Almeda v. Heirs of
Ponciano Almeda, G.R. No. 194189,
September 14,2017).
The marriage may be ratified by the insaneperson,
after gaining sanity, by freely cohabitating with the
other as husband andwife (FAMILY CODE, Art. 45,
par. 2).
3. Consent of either party obtained by
Fraudulent means as enumerated in Art.
46 of the Family Code; (NPSD)
a. Non–disclosure of a previous conviction
by final judgment of the other party of a
crime involving moral turpitude;
b. Concealment by the wife of the fact that
at the time of the marriage, she was
Pregnant by a man other than her
husband;
The marriage may be ratified by the
injured party by freely cohabitating with
the guilty spouse as husband and wife
after gaining full knowledge of the facts
constituting the fraud (FAMILY CODE,
Art. 45(3)).
NOTE: Concealment must be in bad
faith. If the woman did not expressly
inform the man of her pregnancy but
such physical condition was readily
apparent to the man, he cannot claim
lack of knowledge thereof (Buccat v.
Buccat, G.R. No. 47101, April 25,
1941).
c. Concealment of a Sexually
transmissible disease, regardless of its
nature, existing at the time of the
marriage;
NOTE: Nature or gravity of disease is
irrelevant; it is enough that there was
concealment at the time of the
ceremony (RABUYA, supra at 458).
d. Concealment of Drug addiction, habitual
alcoholism, homosexuality or
lesbianism existing at the time of the
marriage.
Fraud
There is fraud when, through insidious
words or machinations of one of the
contracting parties, the other is induced to
enter into a contract which, without them, he
would not have agreed to (CIVIL CODE, Art.
1338).
Enumeration Exclusive
The enumeration in Art. 46 is exclusive.
 Hence, misrepresentation as to character,
health, rank, fortune or chastity is not a
ground for annulment (Anaya v. Palaroan,
G.R. No. L–27930, November 26, 1970).
Mere non-cohabitation is also not a ground
for annulment of marriage (Villanueva v. CA,
GR No. 132955, October 27, 2006).
Entering into a marriage for the sole purpose
ofevading immigration laws does not qualify
as a ground of fraud under any of the listed
circumstances (Republic v. Albios, G.R. No.
198780, October 16, 2013).
4. Vitiated consent of either party through
Force, intimidation or undue influence;
NOTE: Criminal liability attaches to anyone who
uses violence, intimidation and fraud in
contracting a marriage (REVISED PENAL
CODE, Art. 350).
Violence
When in order to wrest consent, serious or
irresistible force is employed (CIVIL CODE, Art.
1335, Par. 1).
Intimidation
When one of the contracting parties is
compelled by a reasonable and well-grounded
fear of an imminent and grave evil upon his
person or property, or upon the person or
property of his spouse, descendants or
ascendants, to give his consent (CIVIL CODE,
Art. 1335, Par. 2).
Factors to consider in violence and intimidation:
(ASC)
a. Age;
b. Sex; and
c. Condition of the person.
NOTE: A threat to enforce one’s claim through
competent authority, if the claim is just or legal,
does not vitiate consent (CIVIL CODE. Art.
1335, pars. 3 and 4).
Undue influence
It is when a person takes improper advantage
of another, depriving the latter of reasonable
freedom of choice (CIVIL CODE, Art. 1337).
Factors to Consider: the confidential, family,
spiritual and other relations between the parties
or the fact that the person alleged to have been
unduly influenced was suffering from mental
weakness or was ignorant or in financial distress
(CIVIL CODE, Art. 1337).
The marriage may be ratified by the injured party
by freely cohabiting with the guilty spouse as
husband and wife after the disappearance or
cessation of force, intimidation or undue
influence (FAMILY CODE, Art. 45, par. 4).
5. Physical incapability of either party to
consummate the marriage with the
other, and such incapacity continues
and appears to be incurable;
NOTE: Art. 45, Par. 5 of the Family Code refers
to lack of power to copulate. Incapacity to
consummate the marriage denotes the
permanent inability on the part of the spouses
to perform the complete act of sexual
intercourse. Non-consummation of a marriage
may be on the part of the husband or of the wife
and may be caused by a physical or structural
defect in the anatomy of one of the parties or it
may be due to chronic illness and inhibitions or
fears arising in whole or in part from
psychophysical conditions. It may be caused by
psychogenic causes, where such mental block
or disturbance has the result of making the
spouse physically incapable of performing the
marriage act (Alcazar v. Alcazar, G.R.
No.174451, October 13, 2009).
Impotence
Impotency refers to lack of power to copulate,
not to mere sterility (SEMPIO-DIY, supra at 71).
Impotency being an abnormal condition should
not be presumed. The presumption is in favor
of potency (People v. Benjamin Lim Y Beltran,
G.R. Nos. 131861, August 17, 1999). It refers
to the physical inability to have sexual
intercourse and is not synonymous with sterility.
Subsequently, sterility refers to the inability to
procreate (Macadangdang v. CA, G.R. No. L-
49542, September 12, 1980).
Impotency caused by a supervening infirmity
does not invalidate the marriage (RABUYA,
supra at 462).
Requisites for Annulment due to Impotence:
(Not-U-PIE)
a. It Exists at the time of the celebration of the
marriage;
b. It is Permanent;
c. It is Incurable
d. It is Unknown to the other spouse; and
e. The other spouse must Not also be impotent
(STA.MARIA, Persons, supra at 322-323).
The marriage is not subject to ratification by the
continued cohabitation as husband and wife
because there has been an entire and complete
 failure of the consideration of the marriage ACTION FOR ANNULMENT OF
contract. However, the defect may still be barred VOIDABLE MARRIAGES
by prescription (RABUYA, supra at 464).
Grounds Persons Prescrip- Ratifica-
Doctrine of Triennial Cohabitation (AUFFIS) Who May tive tion
The presumption that the husband is impotent if Sue Period
the wife remains a virgin for at least 3 years from
the time spouses started cohabiting (Tompkins Parent/ Any time
v. Tompkins, 92 NJ 113 as cited in STA.MARIA, legal before the
supra at 324; 1 PARAS, supra at 472). guardian parties
Absence having reach 21
Refusal on the part of a Filipino girl to submit to of charge of Free
a physical examination to determine impotency Parental the parties cohabita-
does not raise the presumption of impotency Consent tion after
Parties to Within 5 reaching
because of the natural modesty of our native
the years after age of 21
girls (Jimenez v. Canizares, G.R. No. L-12790,
marriage reaching
August 31, 1960).
21
6. Sexually transmissible disease of either Sane Any time Free
party found to be serious and appears to spouse before the cohabita-
be incurable. who has death of tion after
no either insane
Elements: (SEASU) knowledge party regains
a. Sexually transmissible disease; of the sanity
b. Existing at the time of marriage; insanity
c. Appears incurable;
d. It is Serious; and Relative Any time
e. Unknown to the other party at the time guardian before the
ofthe marriage (RABUYA, supra at 465). Unsound or persons death of
mind having either
The marriage is not subject to ratification by the legal party
continued cohabitation but the defect may still charge of
be barred by prescription (Id.). the insane

NOTE: Whichever comes first between Insane During

cohabitation or prescription may convalidate the spouse lucid
marriage. The term “convalidate” in Roman interval or
Catholic canon law is the making of a putative after
marriage valid following the removal of some regaining
impediment. sanity

Injured Within 5 Free

party Years from cohabita-
the tion even
Fraudu- discovery with full
lent of fraud knowledge
means of facts
constitu-
ting the
fraud

Injured Within 5 Free

party years from cohabita-
Force, the time tion after
inti- the force, disappear-
midation, intimida- rance of
or undue tion, or force,
influence undue intimida-
influence tion/ undue
ceased influence,
 between the contending parties is not fatal to the
Grounds Persons Prescrip- Ratifica-
validity of the proceedings in the trial court (Tuason
(AUFFIS) Who May tive tion
v. CA, G.R. No. 116607, April 10, 1996).
Sue Period

respec- NOTE: If the defendant spouse fails to answer the

tively complaint, the court cannot declare him or her in
default; instead, it should order the public prosecutor
Injured Within 5 No to determine if collusion exists between the parties
party years after ratification (RULES OF COURT, RULE 18, Secs. 6 and 13 (b);
the since defect Supreme Court En Banc Resolutionsupra).
Impotency
celebra- is perma-
tion of the nent PENDENCY OF ACTION FOR
marriage
ANNULMENT
Injured Within 5 No During the pendency of the action and in the
party years after ratification absence of adequate provisions in a written
STD the celebra- since defect agreement between the spouses, the court shall:
tion of the is 1. Provide for the support of the spouses and the
marriage permanent custody and support of common children;
(FAMILY CODE, Arts. 45 and 47). 2. Give paramount consideration to the moral and
material welfare of the said children and their
choice of the parent with whom they wish to
remain; and
ADDITIONAL 3. Provide for appropriate visitation
(FAMILY CODE, Art. 49).
rights

REQUIREMENTS FOR
ANNULMENT OR NOTE: Visitation rights flow from the natural right of
both parents to each other’s company. There being
DECLARATION OF no such parent-child relationship between them,
Gerardo, who is the father of Mario, has no
NULLITY (ART. 48, PAR. demandable right to visit the child of Mario with
1; SUPREME COURT EN Theresa (Concepcion v. CA, G.R. No. 123450,
August 31, 2005).
BANC RESOLUTION A.M.
02-11-10-SC) DECISION ON THE NULLIFICATION OF
THE MARRIAGE
No judgment shall be based upon stipulation offacts
or confession of judgment (FAMILY CODE, Art. 48,
PROSECUTING ATTORNEY OR FISCAL Par. 2).
SHOULD:
STIPULATION OF FACTS
1. Appear on behalf of the state;
2. Take steps to prevent collusion between the An admission by both parties made in court agreeing
parties; and to the existence of the act constituting the ground for
3. Take care that evidence is not fabricated or annulment or for the declaration of nullity
suppressed (FAMILY CODE, Art 101). (STA.MARIA, supra at 335).

COLLUSION CONFESSION OF JUDGMENT

There would be collusion if the parties had arranged
to make it appear that a matrimonial offense had
been committed although it was not, orif the parties
had connived to bring about a legal separation even
in the absence of grounds therefor (De Ocampo v.
Florenciano, G.R. No. L–13553,February 23, 1960).
However, petitioner’s vehement opposition to the
annulment proceedings negates the conclusion that
collusion existed between the parties. Under these
circumstances, the non–intervention of a matters had been adjudicated in previous
prosecuting attorney to assure lack of collusion
The admission made in court by the respondent
admitting fault as invoked by the plaintiff to sever the
marriage ties (Id.).
After the court grants the petition, it shall issue the
decree of absolute nullity or annulment only after
compliance with the following: (LiPaDi-Le-Re2)
1. Liquidation, Partition, and Distribution of the
properties of the spouses including custody and
support of the common children unless such
judicial proceedings;
2. Delivery of the children’s presumptive Legitimes
in cash, property or sound securities unless
otherwise mutually agreed upon and judicially
approved;
NOTE: Delivery shall in no way prejudice the
ultimate successional rights of the children
accruing upon the death of either or both
parents. The value of the properties received
shall be considered as advances on their
legitime (FAMILY CODE, Art. 51).
3. Registration of the entry of judgment granting
petition for declaration of absolute nullity or
annulment in the Civil Registry where the
marriage was celebrated and in the Civil
Registry where the marriage was recorded; and
4. Registration of approved partition and
distribution of properties of the spouses in the
proper Registry of Deeds where the real
properties are located (FAMILY CODE, Arts.50-
52).
EFFECTS OF THE DECREE OF
ANNULMENT
1. Termination of the marital bond but effects
thereof are not totally wiped out (RABUYA,
supra at 313).
2. Either of the former spouses may re-marry after
complying with the requirements of Art. 52
(FAMILY CODE, Art. 53).
3. On Children (FAMILY CODE, Art. 54)
a. Those conceived or born before the
judgment or annulment or absolute nullity
of the marriage under Art. 36 has become
final and executory, shall be considered
legitimate.
b. Those conceived or born of the subsequent
marriage under Art. 53 shall likewise be
legitimate.
4. If the marriage is governed by Absolute
Community of property or Conjugal Partnership
of Gains, the same shall be terminated or
dissolved and the same shall be liquidated in
accordance with the provisions of Art. 102 and
129, respectively, of the Family Code (RABUYA,
supra at 493).
a. Unless the parties agree to a complete
separation of property in a marriage
settlement entered into before the
marriage (Dino v. Dino G.R. No. 178044,
January 19, 2011).
b. If either spouse contracted the marriage in
bad faith, the rules in Art. 43, par. 2 in
relation to Art. 50 of the Family Code shall
apply.
5. The custody and support of the common
children together with the delivery of the
common children’s presumptive legitimes shall
also be made, unless such matters had been
adjudicated in previous judicial proceedings
(FAMILY CODE, Art. 50, par. 2).
6. Donations by reasons of marriage shall remain
valid except if the donee contracted the
marriage in bad faith, in which case the donor
may revoke the donation (FAMILY CODE, Art.
86, par. 3).
7. The spouse who contracted the subsequent
marriage in bad faith shall be disqualified to
inherit from the innocent spouse by testate and
intestate succession (FAMILY CODE, Art. 43,
par. 5 in relation to Art. 50).
If the wife is the guilty spouse, she shall resume her
maiden name and surname. If she is the innocent
spouse, she may resume her maiden name and
surname. She may continue to employ her former
husband’s surname unless: (a) the court decrees
otherwise; or (b) she or the former husband is
married again to another person (CIVIL CODE, Art.
371).
NOTE: In both instances under Arts. 40 and 45, the
marriages are governed either by absolute
community of property or conjugal partnership of
gains unless the parties agree to a complete
separation of property in a marriage settlement
entered into before the marriage. Since the property
relations of the parties is governed by absolute
community of property or conjugal partnership of
gains, there is a need to liquidate, partition and
distribute the properties (Diṅo v. Diṅo, G.R. No.
178044, January 19, 2011).
LEGAL SEPARATION
(ART. 55)
A legal separation involves nothing more than bed-
and-board separation of the spouses (Lapuz Sy v.
Eufemio, G.R. No. L-30977, January 31, 1972).
A decree of legal separation or relative divorce does
not affect the marital status, there being no
severance of the vinculum (Laperal v. Republic,G.R.
No. L-18008, October 30, 1962).
EXCLUSIVE AND RESTRICTIVE
GROUNDS FOR LEGAL SEPARATION:
(RPC-6-ADL-BS-LA)
The grounds enumerated by law to warrant a judicial
decree of legal separation are only those
enumerated in Art. 55. They may or may not exist
at the time of the marriage ceremony. As a general
rule, they usually occur after the celebration of the
marriage. No other grounds can be invoked by any
party other than those stated by law (STA.MARIA,
supra at 370).
NOTE: This is in furtherance of the policy of
the State to foster unity in and to preserve the
marital relations as the same is essential to
public welfare (Id.).
1. Repeated physical violence or grossly
abusive conduct directed against the
petitioner, a common child, or a child of
the petitioner;
Repeated Physical Violence means the unjust or
unwarranted exercise of force by a spouse
against the other spouse or their common child
or the child of the other spouse, repeatedly
(RAMIREZ, Law on Marriage (2003), p. 171).
NOTE: Violence need not be physical, it is
submitted that psychological and sexualviolence
and repeated verbal abuse may qualify as
grossly abusive conduct (RABUYA, supra at
352).
The same is also punishable under R.A. No.
9262 (Anti-Violence Against Women and their
Children Act of 2004), (Sec. 3(a)).
Please see Acts of Violence under VAWC under
Rights and Obligations of Couples in Intimate
Relationships in page 67.
2. Physical violence or moral Pressure to
compel petitioner to change religious or
political affiliation.
3. Attempt of the respondent to Corrupt or
induce the petitioner, a common child, or
a child of the petitioner, to engage in
prostitution, or connivance in such
corruption or inducement;
NOTE: Refers to prostitution only, and
irrespective of the age of the child (STA.MARIA,
supra at 373).
The law does not give a cause of action to the
petitioner to file a case for legal separation on
the ground that the respondent-spouse
committed the ground provided in Art. 55, par.
3 upon his or her own child with another person.
However, such act may be a cause to suspend
or terminate, depending on the severity, the
parental authority of the respondent over his
own child pursuant to Art. 231, pars. 2 and 4
of the Family Code(STA.MARIA, supra at 373-
374).
4. Final judgment sentencing the
respondent to imprisonment of more
than 6 years even if pardoned;
These requisites must concur: (6A)
a. The sentence imposed is imprisonment of
more than 6 years; and
b. The conviction occurs only After the
celebration of the marriage.
NOTE: If the respondent is convicted prior to the
celebration of the marriage, it will already be a
ground for annulment if the crime involves moral
turpitude and that fact of conviction is not
disclosed to the other party (RABUYA, supra at
353).
5. Habitual Alcoholism or Drug Addiction
of the respondent;
NOTE: If the same was present during the
celebration of the marriage but the same is
concealed from the other party, there is fraud
which constitutes a ground for annulment.
(FAMILY CODE, Art. 46(4))
6. Lesbianism or homosexuality of the
respondent. (FAMILY CODE, Art. 55).
7. Contracting by respondent of a
subsequent Bigamous marriage;
So long as there has been a second bigamous
marriage, wherever celebrated, a legal
separation decree may issue (STA.MARIA,
supra at 375).
NOTE: If the bigamous marriage were
committed abroad, the guilty party cannot be
criminally prosecuted for bigamy in the
Philippines as our penal statutes are territorial
in nature (Id.).
8. Sexual infidelity or perversion
NOTE: Sexual perversion includes engaging in
such behavior not only with third persons but
also with the spouse (Id. at 376).
Where there is evidence of the adultery
 independently of the defendant's statement
agreeing to the legal separation, the decree of
separation should be granted, since it would not
be based on the confession but upon the
evidence presented by the plaintiff. What the
law prohibits isa judgment based exclusively on
defendant's confession (De Ocampo v.
Florenciano, G.R. No. L–13553, February 23,
1960).
9. Attempt by the respondent against the
Life of the petitioner;
NOTE: The attempt on the life of the spouse
must proceed from an evil design and not from
any justifiable cause like self-defense or from
the fact that the spouse caught the other in
flagrante delicto having carnal knowledge with
another man or woman (STA.MARIA, supra at
376-377).
10. Abandonment of the petitioner by the
respondent without justifiable cause for
more than 1 year;
NOTE: There must be absolute cessation of
marital relations, duties, and rights, with the
intention of perpetual separation (Partosa-Jo v.
CA, G.R. No. 82606, December 18, 1992).
Abandonment implies total renunciation of
2. Consent to commission of offense or act
duties. Physical separation alone is not the full
meaning of the term abandonment (Dela Cruz
v. Dela Cruz, G.R. No. L-19565, January 30,
1968).
PREPONDERANCE OF EVIDENCE
Mere preponderance of evidence will suffice to
prove the existence of these grounds, except the
4th ground where previous criminal conviction is
essential in view of the necessity of a “final
judgment” (1 PARAS, supra at 503).
A decree of legal separation, on the ground of
concubinage, may issue upon proof of
preponderance of evidence in the action for legal
separation. No criminal proceedings or conviction is
necessary (Gandionco v. Hon. Peṅaranda, G.R. No.
79284, November 27, 1987).
DEFENSES OR GROUNDS FOR
DENIAL OF PETITION
(FAMILY CODE, ART. 56): (C3MC-PDR)
1. Condonation of the offense or act
complained of;
Condonation
It is the act of forgiving the offense after its
commission. It implies a condition of future good
behavior by the offending spouse. Subsequent
offense on the offending spouse’s part revokes
or nullifies the condonation and revives the
original offense (STA.MARIA, supra at 379).
Failure of the husband to look for his adulterous
wife is not condonation to wife's adultery
(Ocampo v. Florenciano, G.R. No. L–13553,
February 23, 1960).
Sexual intercourse is implied condonation
It has been held that 'condonation is implied
from sexual intercourse after knowledge of the
other’s infidelity. Such acts necessarily implied
forgiveness. It is entirely consonant with reason
and justice that if the wife freely consentsto
sexual intercourse after she has fullknowledge
of the husband's guilt, her consent should
operate as a pardon of his wrong.
It has been held in a long line of decisions ofthe
various supreme courts of the different states of
the U.S. that 'a single voluntary actof sexual
intercourse by the innocent spouse after
discovery of the offense is ordinarily sufficient to
constitute condonation, especially as against the
husband' (Busuego v. Office of the
Ombudsman, G.R. No. 196842, October 9,
2013).
complained of;
Consent
There is consent when either of the spouses
agreed to or did not object, despite full
knowledge, to the act giving rise to a ground for
legal separation, before such act was in fact
committed (STA.MARIA, supra at 380).
Consent is prior to the act; Condonation comes
after (People v. Schneckenburger, G.R. No.
48183, November 10, 1941). It may be
expressed or implied.
Where the spouses entered into an agreement
that each could live with and have carnal
knowledge with other persons without
interference from each spouse, the agreement
is null and void being contrary to law and good
morals, but it may be considered consent which
bars an action for legal separation (People v.
Schneckenburger, G.R. No. 48183, November
10, 1941).
3. Connivance between parties in
commission of an offense or act
constituting a ground for denial of the
petition;
Connivance or procurement
Denotes direction, influence, personal exertion,
or other action with knowledge and belief that
such action would produce certain results and
which results are produced (Cohen, Divorce
and Alimony in North Carolina, 59, IV, p. 98 as
cited in STA.MARIA, supra at 380).
Example: If a husband hires a detective to spy
on his wife, and tells him to have sexual
intercourse with her in order to have evidence
(Keeze, Marriage and Divorce, pp. 550-551, as
cited in PARAS, supra at p. 492).
4. Mutual guilt or where both parties have
given ground for legal separation;
5. Collusion between parties;
Collusion
It means that the spouses agree to make it
appear in court that one of them has committed
a ground for legal separation, or to suppress
evidence of a valid defense to such action, for
the purpose of enabling the other to obtain a
decree of legal separation (SEMPIO – DIY,
supra at 104-105).
Difference between Collusion and
Connivance
Collusion is a corrupt agreement, while
connivance is a corrupt consenting
(STA.MARIA, supra at p. 364).
6. Prescription;
Five-year prescriptive period
An action for legal separation shall be filed within
5 years from time of occurrence of the cause
(FAMILY CODE, Art. 57)
7. Death of either party during the
pendency of the case (Lapuz–Sy v.
Eufemio, G.R. No. L- 30977, January 31,
1972); and
8. Reconciliation of the spouses during the
pendency of the case.
PROCEDURES IN LEGAL SEPARATION
1. Who may file the action
A petition for legal separation may be filed only
by the husband or the wife (A.M. No. 02-11- 11-
SC, Sec. 2).
2. When to file the action
A petition for legal separation may be filed only
within five years from the occurrence of any of
the causes of legal separation (A.M. No. 02- 11-
11-SC, Sec. 2).
3. Venue
The petition shall be filed in the Family Court
of the province or city where the petitioner or
respondent has been residing for at least six
months prior to the date of filing or in the case of
a non-resident respondent, where he may be
found in the Philippines, at the election of the
petitioner (A.M. No. 02-11-11-SC, Sec. 2(c)).
4. Prohibited Compromise (CVL-SJL)
The court shall not allow compromise on
prohibited matters such as:
a. The Civil status of persons;
b. The Validity of a marriage or of a legal
separation;
c. Any ground for Legal separation
d. Future Support;
e. The Jurisdiction of courts; and
f. Future Legitime.
NOTE: A compromise comprises only those
objects which are definitely stated therein, or
which by necessary implication from its terms
should be deemed to have been included inthe
same. Where a compromise agreementmakes
no mention of the marital ties between spouses
but is limited only to their property relations vis-
à-vis their children, the Court held it was not
prohibited (Santos v. Santos, G.R. No. 214593,
July 17, 2019).
Please refer to Summary Judicial Proceedings in
page 149 for further discussions.
COOLING–OFF PERIOD
6-month period from the filing of the petition
designed to give the parties enough time to further
contemplate their positions with the end in view of
attaining reconciliation between them. No action for
legal separation shall be tried during such period
(FAMILY CODE, Art. 58). It is a mandatory
requirement and its non-compliance makes the
decision infirm (Pacete v. Carriaga, Jr., G.R. No.
53880, March 17, 1994).
NOTE: The cooling-off period can be dispensed with
if the ground for legal separation involves violence
against the woman or the child under R.A. 9262.
Even during the 6-month period, however, the court
must still provide for the support of the spouses and
the children as well as the custody of the children
(Araneta v. Concepcion and Benitez – Araneta, G.R.
No. L-9667, July 31, 1956).
A writ of preliminary mandatory injunction for the
return of the wife’s paraphernal property can in the
meantime, be heard and granted during the 6-
month period (Somosa-Ramos v. Vamenta, Jr., G.R.
No. L-34132 July 29, 1972).
EFFECTS OF FILING PETITION FOR
LEGAL SEPARATION: (LDS)
1. The spouses shall be entitled to
Live separately from each other;
2. In the absence of an agreement between the
parties, the court shall Designate the husband,
the wife, or a third person to manage the
absolute community or conjugal partnership of
gains property (FAMILY CODE, Art. 61); and
3. The husband shall have no more right to have
Sexual intercourse with his wife (SEMPIO-DIY,
supra at 110).
EFFECTS OF DECREE OF LEGAL
SEPARATION (LDC-DR- DDS):
1. The spouses shall be entitled to Live separately
from each other, but the marriage bonds shall
not be severed;
NOTE: The wife who has been granted legal
separation cannot petition to be allowed to revert
to her maiden name (CIVIL CODE, Art. 372).
2. The ACP or CPG shall be Dissolved and
liquidated but the offending spouse shall have
no right to any share of the net profits earned by
the ACP or CPG, which shall be forfeited in
accordance with the provisions of Article 43(2);
3. The Custody of the minor children shall be
awarded to the innocent spouse, subject to the
provisions of Article 213 of the Family Code;
4. The offending spouse shall be Disqualified from
inheriting from the innocent spouse by intestate
succession. Moreover, provisions in favor of
the offending spouse in the will of the innocent
spouse shall be Revoked by operation of law
(FAMILY CODE, Art. 63).
5. The innocent spouse may revoke theDonations
made by him or by her in favor ofthe offending
spouse
NOTE: The action for revocation must be
brought within 5 years from the time the decree
of legal separation has become final (FAMILY
CODE, Art. 64)
6. The innocent spouse may revoke the
Designation of the latter as a beneficiary in any
insurance policy, even if such designation be
stipulated as irrevocable (FAMILY CODE, Art.
64).
7. The obligation of mutual Support between the
spouses ceases (FAMILY CODE, Art. 198).
NOTE: In case of legal separation, the court
may order that the guilty spouse shall give
support to the innocent one, specifying the terms
of such order (FAMILY CODE, Art. 198).
RECONCILIATION OF LEGALLY
SEPARATED SPOUSES
If the spouses should reconcile, the corresponding
joint manifestation under oath duly signed by them
shall be filed with the court in the same proceeding
for legal separation (FAMILY CODE, Art. 65).
EFFECTS OF RECONCILIATION OF THE
SPOUSES
1. The legal separation proceedings, if still
pending, shall thereby be terminated at
whatever stage.
2. The final decree of legal separation shall be set
aside, but the separation of property and any
forfeiture of share of the guilty spouse already
affected shall subsist, unless the spouses agree
to revive their former property regime(FAMILY
CODE, Art. 66).
REVIVAL OF PROPERTY REGIME
Agreement of revival and motion for its approval
shall be filed in court in the same proceeding for
legal separation and shall be executed under oath,
where it shall specify:
1. Properties to be contributed anew to restored
regime;
2. Those to be retained as separated properties of
each spouse; and
3. Names of all known creditors, addresses, and
amounts owing to each (FAMILY CODE, Art.
67).
After due hearing, the court shall take measures to
protect the interest of creditors and such order shall
be recorded in the proper registries of properties but
the same shall not prejudice creditors not listed or
notified, unless the debtor-spouse has sufficient
separate properties to satisfy the creditor’s claim
(FAMILY CODE, Art. 67). While the Family Code
mentions only the revival of the former property
regime, A.M. No. 0211-SC allows the spouses to
adopt a different property regime.
EFFECT OF DEATH OF ONE OF THE
PARTIES
In case a party dies at any stage of the proceedings
before the entry of judgment, the court shall order
the case closed and terminated, without prejudice
to the settlement of the estate in proper proceedings
in the regular courts (A.M. No. 02-11- 11-SC, Sec.
42).

Death of one party to the action causes the death

of the action itself — actio personalis moritur cum
persona. When one of the spouses is dead, there is
no need for divorce, because the marriage is
dissolved. (Lapuz–Sy v. Eufemio, G.R. No. L-
30977, January 31, 1972).
 EFFECTS OF THE PETITION FOR DECLARATION OF
PRESUMPTIVE DEATH, NULLITY OF MARRIAGE,
ANNULMENT, AND LEGAL SEPARATION

TERMINATION DECLARATION OF NULLITY ANNULMENT LEGAL

(ART. 41) (ART. 40) (ART. 45) SEPARATION
(ART. 55)

Rendering Judgment on the Petition

Summary proceeding; No motion to dismiss shall be allowed except if the ground is lack of jurisdiction.
judgment may be
rendered based on The grounds alleged must be proved. No judgment on the pleadings, summary
affidavits, judgment or confession of judgment shall be allowed.
documentary evidence
or oral testimonies at NOTES:
the sound discretion of Stipulation of Facts
the court (FAMILY - an admission by both parties made in court agreeing to the existence of the act
CODE, Art.246). constituting the ground for annulment or for the declaration of nullity.

Confession of Judgment
- the admission made in court by the respondent admitting fault as invoked by the
plaintiff to sever the marriage ties (STA.MARIA, supra at 335).

In legal separation cases, no decree shall be issued unless the Court has taken steps
toward reconciliation of the spouses and is fully satisfied, despite such efforts,that
reconciliation is highly improbable (FAMILY CODE, Art. 59).

Procedural Requirements After Judgment, Before Issuance of Decree

Summary proceeding; 1. Liquidation, partition, delivery of properties, including custody and support of
judgment may be common children unless such matters had been adjudicated in previous judicial
rendered based on proceedings;
affidavits, 2. Delivery of children’s presumptive legitimes;
documentary evidence 3. Registration of the entry of judgment granting the petition in the Civil Registry
or oral testimonies at where the marriage was celebrated AND in the Civil Registry of the place where
the sound discretion of the family court is located; and
the court (FAMILY 4. Registration of approved partition and distribution of properties in the Registry of
CODE, Art.246). Deeds where the real properties are located.

Marital Status

Subsequent marriage Previous marriage, void ab Valid until annulledor No dissolution of

automatically initio. terminated. marriage, only
terminated by affidavit separation of bed-
ofreappearance. and-board; entitled to
live separately.

Status of Children Born/Conceived Before Termination

Legitimate Illegitimate except those under Legitimate Legitimate

Arts. 36 and 53
 TERMINATION DECLARATION OF NULLITY ANNULMENT LEGAL
(ART. 41) (ART. 40) (ART. 45) SEPARATION
(ART. 55)

Custody of Children

Custody in case of During pendency:

dispute shall be 1. Written agreement
decidedby the court in 2. Absence thereof, the court decides based on best interest of child and may
separate proceeding award it in the following order of preference:
for custody but same a. Both parents jointly;
considerations as in b. Either parent, may consider choice of child over 7 years unless parent chosen
Declaration of Nullity. is unfit;
c. Surviving grandparent, if several then choice of child over 7 years unless
grandparent chosen is unfit/disqualified;
d. Eldest brother/sister over 21 unless unfit/disqualified; or
e. Any other person deemed suitable by court.

After decree:
To the innocent spouse, but no child under 7 shall be separated from the mother
unless there are compelling reasons.

NOTE: The matter of custody is not permanent and unalterable. If the parent who was given custody suffers a
future character change and becomes unfit, the matter of custody can always be re-examined and adjusted.
To be sure, the welfare, the best interest, the benefit, and the good of the child must be determined as of the
time that either parent is chosen to be the custodian (Beckett v. Sarmiento, Jr., A.M. No. RTJ-12-2326, January
10, 2013).

Child Support

Support in case of During pendency:

dispute shall be 1. Written agreement;
decided by the court in 2. In the absence thereof, from properties of the absolute community of property
a separate proceeding (ACP) or conjugal partnership (CP).
for custody but with
the same After Decree:
considerations as in Either parent or both may be ordered by the court to give an amount necessary for
Declaration of Nullity. support in proportion to resources/means of the giver and necessities of the recipient

Spousal Support

Spousal Support During pendency:

during the pendency of 1. Written agreement;
action (FAMILY 2. In the absence thereof, from properties of the ACP or CP, considered asadvance
CODE, Art. 49). to be deducted from share during liquidation; and
3. Restitution if after final judgment court finds that person providing support
pendente lite is not liable therefor (RULES OF COURT, RULE 61, Sec. 7).

Property Relations

1. ACP or CP shall be 1. ACP or CP shall be 1. ACP or CP shall be 1. ACP or CP shall

dissolved dissolved andliquidated; dissolved and be dissolved and
2. If either spouse contracted liquidated; liquidated;
andliquidated; marriage in bad faith, he or 2. If either spouse 2. Offending
2. If either spouse she hasno right to any share contracted marriage in spouse has no
contracted of the net profits earned by bad faith, he or she right to any share
marriage in bad ACP or CP; and has no right to any of net profits
faith, he or she 3. Net profits shall be forfeited share of the net profits earned by ACP
has no right to any in favor of common children, earned by ACP or CP; or CP; and
share of the net or if none, children of guilty and 3. Net profits shall
 TERMINATION DECLARATION OF NULLITY ANNULMENT LEGAL
(ART. 41) (ART. 40) (ART. 45) SEPARATION
(ART. 55)

profits earned by spouse by previous 3. Net profits shall be be forfeited in

ACP or CP; and marriage, or in default forfeited in favor of favor of common
3. Net profits shall be thereof, the innocent common children, or if children, or if
forfeited in favor of spouse. none, children of guilty none, children of
common children, spouse by previous guilty spouse by
or if none, children In all other cases of void marriage, or in previous
of guilty spouse by marriage, Art. 147 and 148 default thereof, the marriage, or in
previous marriage, applies. innocent spouse. default thereof,
or in default the innocent
thereof, the In addition, for marriages under spouse.
innocent spouse. Art. 40 and 45:
1. All creditors of spouses and
of the ACP or CP shall be
notified of the proceedings
forliquidation;
2. Conjugal dwelling and lot on
which it is situated shall be
adjudicated pursuant to Art.
102 and 129.

Donation Propter Nuptias

1. Shall remain valid, 1. Shall remain valid, unless 1. Shall remain valid, Donor is given option
unless donee donee contracted marriage unless doneecontracted to revoke; if donor
contracted in bad faith, in which case, marriage in bad faith, decides to revoke,
marriage in bad donation is revoked by in which case, donation must do so within 5
faith, in which operation of law. is revoked by operation years from finality of
case, donation is 2. If both spouses of of law(Art. 43, par. 3). decree
revoked by subsequent marriage acted 2. No conflict with Art. 86,
operation of law. in bad faith, donations par. 2 as such does not
2. If both spouses of propternuptias made by one require that marriage be
subsequent in favor of the other are annulled first before
marriage acted in revoked by operation of law donor may revoke
bad faith,donations (FAMILY CODE, Art. 44). donation – donor has 5
propter nuptias 3. If both spouses are in good years from time he had
made by one in faith, the donor after finality knowledge of lack of
favor of the other of decree may revoke consent; cannot revoke
are revoked by pursuant to Art. 86(1). if there was knowledge
operation oflaw. before the
marriage.
3. Conflict with Art.86, par.
3 but Art. 43, par. 3
prevails– more in
harmony with general
purpose/intent ofact.

Insurance Policy

Innocent spouse may revoke the designation of the other spouse who acted in bad Innocent spouse may
faith as beneficiary even if the designation is stipulated as irrevocable (FAMILY CODE, revoke designation of
Art. 43, par. 4). the guilty spouse as
beneficiary even if
stipulated as
irrevocable (FAMILY
CODE, Art. 64).
 TERMINATION DECLARATION OF NULLITY ANNULMENT LEGAL
(ART. 41) (ART. 40) (ART. 45) SEPARATION
(ART. 55)

Revocation takes
effect upon written
notice to the insured
(insurer).

Succession

Spouse in bad faith disqualified to inherit from innocent spouse by testate or intestate1. Offending spouse
succession. If both spouses of subsequent marriage acted in bad faith, testamentary disqualified from
dispositions made by one in favor of the other are revoked by operation of law (FAMILY inheriting from
CODE, Art. 43). innocent spouse by
intestate succession.
Provisions in favor of
offending spouse
made in the will of
innocent spouse are
revoked by operation
of law (FAMILY
CODE, Art.63(4)).

RIGHTS AND
OBLIGATIONS
BETWEEN THE
HUSBAND AND THE
WIFE (ARTS. 68-73)
RIGHTS AND OBLIGATIONS
BETWEEN HUSBAND AND WIFE
(LORD-SM)
1. Duty to Live together;
Extent of the Duty
While the law provides that the husband and the
wife are obliged to live together, observe mutual
love, respect and fidelity (Art. 68, Family Code),
the sanction therefor is actually the
"spontaneous, mutual affection between
husband and wife and not any legal mandate or
court order (Chi Ming Tsoi v. CA, G.R. No.
119190, January 16, 1997).
NOTE: Cohabitation or the obligation to live
together is the public assumption by a man and
a woman of the marital relation and dwelling
together as husband and wife, thereby holding
themselves out to the public as such (Bitangcor
v. Tan, A. M. No. 528-SBC, February 25, 1982).
2. Duty to Observe mutual love, respect
and fidelity;
3. Duty to Render mutual help & support
(FAMILY CODE, Art. 68);
4. Duty to Fix the family Domicile;
Rule in Fixing the Family Domicile
a. Both husband and wife shall fix the
family domicile. In case of disagreement,
the court shall decide.
b. The court may exempt one spouse from
living with the other if the latter should
live abroad or there are other valid and
compelling reasons for the exemption.
However, such exemption shall not
apply if the same is not compatible with
the solidarity of the family (FAMILY
CODE, Art.69).
5. Joint responsibility for the Support of
the family; and
6. Expenses shall be paid from the
community property;
a. In the absence thereof, from income or fruits
of their separate properties;
b. In the absence or insufficiency thereof, from
their separate properties (FAMILY CODE,
Art. 70).
7. Joint Management of the household
NOTE: Expenses for such management shall be
paid in accordance with Art. 70 (FAMILY CODE,
Art. 71).
EFFECT OF NEGLECT OF DUTY
When one of the spouses neglects his or her duties
to the conjugal union or commits acts which tend to
bring danger, dishonor or injury to the other or to
the family, the aggrieved party may apply to the court
for relief (FAMILY CODE, Art. 72).
The relief may take on many forms:
1. Filing a case for legal separation if there are
grounds for the same;
2. Filing an action for declaration of nullity based
on Art. 36 if the neglect is such that it does not
create a functional marital life; and
3. Petitioning the court for receivership, for judicial
separation of property, or for authority to be the
sole administrator of community property or
conjugal partnership (STA.MARIA, supra at
427).
NOTE: Marital rights including coverture and living in
conjugal dwelling may not be enforced by the extra-
ordinary writ of habeas corpus. No court is
empowered as a judicial authority to compel a
husband to live with his wife. Coverture cannot be
enforced by compulsion of a writ of habeas corpus
carried out by sheriffs or by any other mesne
process. That is a matter beyond judicial authority
and is best left to the man and woman's free choice
(Ilusorio v Bildner, G.R. Nos. 139789 & 139808, May
12, 2000).
EXERCISE OF PROFESSION
GENERAL RULE: Either spouse may exercise any
legitimate profession, occupation, business or
activity without the consent of the other (R.A. No.
10572, Sec. 1 amending Art. 73 of the FAMILY
CODE).
EXCEPTION: The other spouse may object only on
valid, serious and moral grounds (R.A. No. 10572,
Sec. 1 amending Art. 73 of the FAMILY CODE).
RULE IN CASE OF DISAGREEMENT
In case of disagreement, the court shall decide
whether: (1) the objection is proper; and (2) the
benefit accrued to the family prior to the objection
or thereafter (R.A. No. 10572, Sec. 1 amending Art.
73 of the FAMILY CODE). Such is summary in
nature (STA.MARIA, supra at 429).
1. Benefit accrued to family before
objection to an immoral or unlawful
profession
– if the benefit accrued prior to the objection, the
resulting obligation shall be enforced against
the community property (R.A. No. 10572, Sec.
1, Par. 2, amending Art. 73 of the FAMILY
CODE).
2. Benefit accrued after objection
– If the benefit accrued thereafter, such
obligation shallbe enforced against the separate
property of the spouse who has not obtained
consent (R.A. No. 10572, Sec. 1, Par. 2
amending Art. 73 of the FAMILY CODE).
3. Creditors who acted in good faith are
protected
– if spouse transacted with creditor without the
consent of the other but creditor had no
knowledge thereof, the absolute community of
property (ACP) or conjugal partnership of gains
(CPG) shall be liable (R.A. No. 10572, Sec. 1
amending Art. 73 of theFAMILY CODE).
EFFECT OF COMPULSION
If a husband compels the wife to desist from
pursuing a profession or any other conduct which the
wife has the right to engage in, this can be
considered acts of violence against women under
R.A. 9262 (STA.MARIA, supra at 428).
PROPERTY RELATIONS
BETWEEN THE
HUSBAND AND THE
WIFE (ARTS. 74-87)
GOVERNED BY:
1. Marriage settlements (MS) executed before the
marriage or ante nuptial agreements;
2. Provisions of the Family Code;
3. Local customs when spouses repudiate ACP
(FAMILY CODE, Art. 74); and
NOTE: Applies when parties stipulate in their MSthat
local custom shall apply or that ACP regime shall
not govern but fail to stipulate what property regime
will be applied (STA.MARIA, supra at 439).
4. Rules on co-ownership will apply in theabsence
of local customs.
COMMENCEMENT
It commences at the precise moment of the
celebration of the marriage. Any stipulation to the
contrary shall be void (FAMILY CODE, Art. 88 for
ACP and 107 for CPG).
MARRIAGE SETTLEMENT (MS)
It is a contract entered into by the future spouses
fixing the property regime that will govern their
present and future properties during their marriage
(SEMPIO – DIY, supra at 135).
In the absence of a marriage settlement or when
the regime agreed upon is void, ACP shall govern
(FAMILY CODE, Art. 75).
REQUISITES: (B-Not2-FAWS)
1. Made Before celebration of marriage
(FAMILY CODE, Art. 76);
2. In Writing (even modifications) (FAMILY
CODE, Art. 77);
The GENERAL RULE is that, in order that any
modification in the marriage settlements may be
valid, it must be made before the celebrationof
the marriage, in writing and signed by the
parties. By way of exception, modification can
be made after the marriage ceremony, but such
modification shall need judicial approval and
should only refer to the instances provided in
Articles 66, 67, 128, 135 and 136 of the Family
Code. (STA.MARIA, supra at 422).
An oral marriage settlement is void and cannot
be ratified by any claim of partial execution or
absence of objection (STA.MARIA, supra at
417).
EXCEPTION: If marriage is terminated by death
of one of the spouses and the surviving spouse
marries again without initiating settlement of
properties of previous marriage within one (1)
year from death of deceased spouse, mandatory
regime of complete separation ofproperty shall
govern property relations of the subsequent
marriage (FAMILY CODE, Arts. 103 and 130).
3. Signed by the parties (FAMILY CODE, Art.
77);
4. Will Not prejudice third persons unless
registered in the civil registry and proper
registries of property (STA.MARIA, supra at
437-438);
5. Shall Fix terms and conditions of their
property relations;
6. Must Not contain provisions contrary
to law, good morals, good customs,
public order, and public policy, or
against the dignity of either spouse; and
7. Additional signatories/ parties in case of
civil interdiction or other disability where
it is indispensable for the guardian
appointed by court to be made a party to
the marriage settlement (FAMILY CODE,
Art. 79).
EFFICACY OF MARRIAGE
SETTLEMENTS
1. The consideration is the marriage itself.
If the marriage does not take place, the
marriage settlement is generally void.
EXCEPTION: Stipulations in the marriage
settlement that do not depend upon the
celebration of the marriage shall be valid
(FAMILY CODE, Art. 81) (e.g., recognition of
child).
2. In the absence of contrary stipulation in
a marriage settlement, the property
relations shall be governed by Philippine
laws, regardless of the place of the
celebration of the marriage or the
parties’ residence.
EXCEPTIONS:
a. If both spouses are aliens, even if
marriedin the Philippines.
b. As to extrinsic validity of contracts
affectingproperty:
i. Not situated in the Philippines and
executed in the country where the
property is located; and
ii. Situated in a foreign country whose
laws require different formalities for
extrinsic validity entered into in the
Philippines (FAMILY CODE, Art.
80).
MODIFICATION IN MARRIAGE
SETTLEMENTS
GENERAL RULE: It must be made before the
marriage, in writing, signed by the parties.
EXCEPTIONS: Modifications made through
judicial decree during the marriage:
1. In case of revival of former property regime
between reconciling spouses after decree of
legal separation has been issued (FAMILY
CODE, Arts. 66 and 67);
2. When abandoned spouse files petition for
judicial separation of property under Art. 128;
3. When a spouse files petition for judicial
separation of property for sufficient cause
under Art. 135 of the Civil Code; and
4. Petition for voluntary dissolution of property
regime under Art. 136 of the Civil Code.
DONATION BY REASON OF MARRIAGE
(DONATIONS PROPTER NUPTIAS)
Donations by reason of marriage are those which
are made before its celebration, in consideration of
the same, and in favor of one or both of the future
spouses (FAMILY CODE, Art. 82).
It is without onerous consideration, the marriage
being merely the occasion or motive for the
donation, not its causa. Being liberalities, they
remain subject to reduction for inofficiousness upon
the donor’s death, should they infringe the legitime
of a forced heir (Mateo v. Lagua, G.R. No. L-26270,
October 30, 1969).
NOTE: Donations propter nuptias can be contained
in a marriage settlement. (STA.MARIA, supra at
444).
Requisites: (COB)
1. In Consideration of marriage;
2. In favor of One or both of the future
spouses;and
3. Made Before celebration of marriage
(FAMILYCODE, Art. 82).
NOTE: If one of the requisites is not complied with,
it may still be valid as an ordinary donation (provided
that all other essential requisites are complied with)
(PARAS, supra at p. 522).
REQUISITES OF A VALID DONATION BY
THE WOULD-BE SPOUSES TO EACH
OTHER IN THE MARRIAGE
SETTLEMENTS: (MOAC)
1. There must be a valid Marriage
settlement stipulating a property regime
other than ACP (FAMILY CODE, Art. 84).
REASON: A donation propter nuptias would
be useless if the property regime is ACP,
where spouses become co-owners, with
exception to matters under Art. 92
(Properties excluded from the community
 property) and those stipulated inthe marriage DONATIONS PROPTER NUPTIAS V.
settlement (STA. MARIA, supra at p. 492). ORDINARY DONATIONS
2. GENERAL RULE: Donation in Marriage Donations Propter Ordinary Donations
settlement not more than One-fifth (1/5) Nuptias
of present property (FAMILY CODE, Art. As to Governing Law
84).
Governed by provisions Governed by Civil Code
NOTE: Any excess shall be considered void and of DPN of the Family provisions on ordinary
the donation will be reduced to 1/5 (FAMILY Code. donations.
CODE, Art. 84).
As to Acceptance
3. Accepted by would-be spouse; and
Does not require Express acceptance is
NOTE: Donee must accept the donation expressacceptance. necessary.
personally, or through an authorized person
with special power for the purpose, or with a As to Future Property
general or sufficient power; otherwise, the
May include future Cannot include
donation shall be void (CIVIL CODE, Art. 745;
property. futureproperty.
STA.MARIA, supra at 444). Acceptance must be
made during the lifetime of the donor and the As to Limitations
donee (CIVIL CODE, Art. 746; STA.MARIA,
supra at 444). If present property is There is no limit to
donated and the donation of present
4. Complies with requisites in Title II of property regime is not property provided
Book II of Civil Code on Donations. ACP, donation is limited legitimes are not
to 1/5 of the property. impaired.
For donation of present property to be valid, the
rules governing ordinary donations under Title III As to Grounds for Revocation
of Book III of the Civil Code must be observed.
Grounds for revocation Grounds for revocation
Please refer to Property Law on requisites of are found in Art. 86 of are found in Chapter 4,
valid donations. the Family Code. Title III, Book III of the
Civil Code.
DONATION PROPTER NUPTIAS OF (SEMPIO – DIY, supra at 145).
FUTURE PROPERTY
Donation propter nuptias (DPN) of future property is EXCLUDED DONATIONS:
allowed by way of exception to Art. 751 of Civil
1. Those made in favor of the spouses after the
Code, which provides that donations cannot
celebration of the marriage;
comprehend future property. It is governed by the
2. Those executed in favor of the future spouses
law on testamentary succession both as to intrinsic
but not in consideration of marriage; and
and extrinsic validity (FAMILY CODE, Art. 84, Par. 2).
3. Those granted to persons other than the
spouses even though they may be founded on
DONATION PROPTER NUPTIAS OF the marriage (Serrano v. Solomon, G.R. No. L-
ENCUMBERED PROPERTY 12093, June 29, 1959).
The donation is valid because the donor is still the
owner, even if it is encumbered. If mortgage is VOID DONATIONS BETWEEN SPOUSES
foreclosed and sold at a lesser price, donee is not 1. Before marriage
liable for deficiency but if sold for more, donee is – if the future spouses agreeupon a regime other
entitled to excess (FAMILY CODE, Art. 85). than ACP, they cannot donate to each other in
their marriage settlements more than 1/5 of their
property. Any excess shall be void (FAMILY
CODE, Art. 84).

EXCEPTION: If the donation propter nuptias is

contained in a separate deed, the “not more than
one-fifth” limitation will not apply. The general
rules on donation under Article 750 of the Civil
 Code shall govern (STA.MARIA, supra at. 430).
2. During marriage
– every donation or grant of gratuitous
advantage, direct or indirect, between the
spouses, shall be void (FAMILY CODE, Art.
87).
Exceptions:
a. Moderate gifts on occasions of family
celebrations
NOTE: The degree of being moderate
depends upon the financial capacity or
condition of the spouses.
b. Donations mortis causa.
NOTE: This rule also applies to persons
living together as husband and wifewithout
a valid marriage (FAMILY CODE, Art. 87).
REASON:
i. To protect secured creditors;
ii. To prevent the weaker spouse from
beinginfluenced by the stronger spouse;
iii. To prevent an indirect violation of the
rule prohibiting modifications of the
marriage settlement during the
existence of the marriage (1 PARAS,
supra at 545).
Beneficiary of Insurance Contract
The prohibition does not include a spouse being
thebeneficiary of an insurance contract over the
life of the other spouse (Gercio v. Sunlife
Assurance Co. of Canada, G.R. No. 23703,
September 28, 1925).
GROUNDS FOR REVOCATION OF
DONATION PROPTER NUPTIAS: (Not-
VP-ARAL)
1. Marriage Not celebrated or declared Void ab
initio, except those donations made in the
marriage settlements which shall be void if
marriage is not celebrated;
NOTE: If made by a stranger, action for
revocation may be brought under the ordinary
rules on prescription: if in writing, brought within
ten (10) years and if oral, within six (6) years
(ALBANO, supra at 436-437).
2. Marriage takes place without Parental consent,
as required by law;
3. Marriage is Annulled and donee is in bad faith;
4. Upon Legal separation, the donee being the
guilty spouse;
5. Donation is with a Resolutory condition and the
condition was complied with; and
6. Donee commits Acts of ingratitude as specified
by Art. 765 of Civil Code (FAMILY CODE, Art.
86).
SYSTEMS OF PROPERTY
REGIME
(ARTS. 88-148)
1. ABSOLUTE COMMUNITY OF
PROPERTY (ACP)
The property regime of the spouses in the absence
of a marriage settlement or when the marriage
settlement is void (1 PARAS, supra at529).
It commences at the precise moment the marriage
is celebrated; any stipulation for the commencement
thereof at any other time isvoid (FAMILY CODE, Art.
88). The same applies to CPG (FAMILY CODE, Art.
107).
Provisions on co-ownership apply to ACP in all
matters not provided by the Chapter on ACP
(FAMILY CODE, Art. 90).
GENERAL RULE: Community property shall consist
of all property owned by the spouses at the time of
the marriage or acquired thereafter (FAMILY CODE,
Art. 91).
EXCEPTIONS: (BEG-O)
a. Property, including fruits and income thereof,
acquired Before the marriage by either spouse
who has legitimate descendants by a former
marriage;
b. Property for personal and Exclusive use except
jewelry;
c. Property acquired during the marriage by
Gratuitous title, including fruits and income
thereof, except when the donor, testator or
grantor expressly provides otherwise (FAMILY
CODE, Art. 92); and
d. Property otherwise classified as separate in the
marriage settlements (FAMILY CODE, Art. 91).
Presumption: Property acquired during the
marriage is presumed to belong to the community,
unless otherwise proven (FAMILY CODE, Art. 93). It
is not rebutted by the mere fact that the Certificate of
Title is in the name of only one spouse (Sideco v.
Aznar, G.R. No. L- 4831, April 24, 1953).
NOTE: No waiver of rights is allowed during the
marriage except in case of judicial separation of
property. The waiver must be in a public instrument
and recorded in the office of thelocal civil registrar
where the marriage contract was recorded as well
as in the proper registry of property (FAMILY CODE,
Arts. 89 and 77). The same applies to CPG (FAMILY
CODE, Art.107).
Alien Married to Filipino Spouse cannot have an
interest on land acquired during the marriage
An alien married to a Filipino cannot have any
interest in the community or partnership property.
(STA.MARIA, supra at 463, citing Matthews v.
Taylor, G.R. No. 164584, June 22, 2009).
Rule on Games of Chance
Loss: Shall be borne by the loser-spouse and shall
not be charged to the community property.
Winnings: Shall form part of the community
property.
EXCEPTION: If said ticket was given to a spouse by
a friend, it shall be considered as a donation under
Art. 92, par. 1. The winnings will not be part of the
ACP unless expressly so providedby the donor of
the ticket (FAMILY CODE, Art. 95 and Art. 92, par.
(1)).
NOTE: The same applies to CPG (FAMILY CODE,
Art. 123).
2. CONJUGAL PARTNERSHIP OF
GAINS (CPG)
It is that formed by a husband and wife whereby
they place in a common fund the proceeds,
products, fruits and income of their separate
properties, and those acquired by either or both
spouses through their efforts orby chance, the net
gains or profits obtained by either or both spouses to
be divided between them equally (as a general rule)
upon the dissolution of the marriage or the
partnership (FAMILY CODE, Art. 106).
Should the spouses agree upon the CPG, its
application shall commence at the precise moment
when the marriage ceremony is celebrated. What is
considered is the hour and not the date of the
marriage (FAMILY CODE, Art. 107; STA.MARIA,
supra at 517.
The CPG shall be governed by the rules on the
contract of partnership in all that is not in conflict
with what is provided in the chapter on CPG or by
the spouses in their MS (FAMILY CODE, Art. 108).
Presumption in Favor of Conjugal Partnership
Property
All property acquired during the marriage, whether
the acquisition appears to have been made,
contracted or registered in the name of one or both
spouses, is presumed to be conjugal unless the
contrary is proved (FAMILYCODE, Art. 116)
Proof of Acquisition during the Marriage
Proof of acquisition during the coverture is a
condition sine qua non for the operation of the
presumption in favor of conjugal partnership. The
party who asserts this presumption must first prove
said time element. The presumption does not
operate when there is no showing as to when the
property alleged to be conjugal was acquired. If
there is no showing as to when the property in
question was acquired, the fact that the title is in the
name of the wife alone is determinative of its nature
as paraphernal, i.e., belonging exclusively to said
spouse. (Jorge v. Marcelo, G.R. No. 232989, March
18, 2019).
Although it is not necessary to prove that the
property was acquired with funds of the partnership,
proof of acquisition during the marriage is an
essential condition for the operation of the
presumption in favor of the conjugal partnership
(Jorge v. Marcelo, supra).
The presumption that property acquired during
marriage is conjugal, does not apply where there is
no showing as to when the property alleged to be
conjugal was acquired. The presumption cannot
prevail when the title is in the name of only one
spouse and the rights of innocent third parties are
involved (Tan v. Andrade, G.R. No. 171904, August
7, 2013).
Properties under Conjugal Partnership: (L2C2
FONTI)
a. Obtained from Labor, industry, work or
profession of either or both spouses;
b. Livestock existing upon dissolution of
partnership in excess of number of each kind
brought to the marriage by either spouse;
c. Acquired by Chance such as winnings from
gambling, but losses therefrom shall be borne
exclusively by loser-spouse;
d. Acquired during the marriage by onerous title
with Conjugal funds;
NOTE: Although the property appears as
registered in the name of the husband, if it was
acquired for a valuable consideration during the
marriage, it bears the character of conjugal
property, whether the acquisition is made for the
partnership, or for one of the spouses only
(Marigsa v. Macabuntoc, G.R. No. 4883,
September 27, 1910).
Rule on Award of Damages
Damages for physical injuries inflicted by a third
person are exclusive property (Lilius v. Manila
Railroad Co. G.R. No. 42551 September 4,
 1935).
e. Fruits of the conjugal property during the
marriage;
f. Acquired through Occupation such as
fishing or hunting;
g. Net fruits of their exclusive property;
h. Share of either spouse in hidden Treasure
(FAMILY CODE, Art. 117); and
i. Interest falling due during the marriage on
principal amount of credit belonging to one
spouse which is payable in partial payments/
installments and collected during the marriage
(FAMILY CODE, Art. 119).
Disposition of CPG
A wife’s consent to the husband’s disposition of
conjugal property does not always have to be explicit
or set forth in any particular document, so long as it
is shown by the acts of the wife that such consent
was indeed given (Pelayo v. Perez, G.R. No.
141323, June 8, 2005).
The absence of the consent of one spouse to a sale
renders the entire sale null and void, including
the portion of the conjugal property pertaining to the
spouse whocontracted the sale (Orpiano v. Spouses
Tomas, G.R. No. 178611, January 14, 2013).
Exclusive Property of each Spouse: (OGREC)
a. That which is brought to the marriage as his/her
Own (even if with legitimate descendants by a
former marriage);
b. Acquired during the marriage by Gratuitoustitle;
Exclusive Property of each Spouse
Property donated/left by will to spouses,jointly
with designation of determinate shares, shall
pertain to donee-spouse as his/her exclusive
property; in the absence of designation,
property shall be dividedbetween them but shall
belong to themexclusively (FAMILY CODE, Art.
113).
Non-acceptance vis-à-vis accretion
If spouse does not accept his/her part of the
donation, accretion sets in favor of the other
spouse who will own all of property donated as
separate property (FAMILY CODE, Art. 113).
NOTE: Accretion will not apply if donor so
provides or if donation is not joined as when the
wife was given a house and the husband was
given a car.
Onerous Donations
If donation is onerous, charges shall be borne by
exclusive property of donee- spouse, whenever
advanced by the CPG (FAMILY CODE, Art.
114).
Pensions and Annuities
Retirement benefits, pensions, annuities,
gratuities, usufructs, and similar benefits
acquired by gratuitous title are exclusive
properties; if by onerous title during marriage
(i.e. contributions to pension funds or deduction
from salaries of common funds) they are CP
(FAMILY CODE, Art. 115).
Unearned Increments
Unearned increment (such as increase in the
value of the paraphernal property) belongs to
the spouse concerned.
c. Acquired by right of Redemption, barter or
exchange with property belonging to either
spouse;
When exclusive property was redeemed
through conjugal funds
Ownership still belongs to person who has right
of redemption, even if conjugal funds are used
to redeem, subject to reimbursement. (Santos v.
Bartolome, G.R. No. L-18032, November 23,
1922).
d. Purchased with Exclusive money of either
spouse (FAMILY CODE, Art. 109); and
When new property was acquired through
separate property and conjugal funds
If separate property in addition to conjugal funds
were used as part of the purchase price of a new
property, the new property shall be considered
conjugal.
e. Principal amount of Credit belonging to one
spouse payable in partial payments/
installments, which will be fully paid during the
marriage (FAMILY CODE, Art. 119).
Use of Exclusive Properties: (PISI)
a. Payment of Personal debts;
b. Fines and Indemnities;
c. Support of illegitimate children of the owner-
spouse; and
d. In case of Insufficiency of the CPG (STA.MARIA,
supra at 522-523)
Dominion over Exclusive Properties
The spouses retain the ownership, possession,
administration and enjoyment of their exclusive
properties (FAMILY CODE, Art. 110).
Either spouse may mortgage, encumber, alienate or
otherwise dispose of his or her exclusive property CHARGES UPON AND OBLIGATIONS
(R.A. No. 10572, Sec. 2). OF ACP AND CPG
Property Bought on Installment ACP (Art. 94) CPG (Art. 121)
Property bought on installments paid partly from
exclusive funds of either or both the spouses and Support of the spouses, their common children,
partly from conjugal funds: and legitimate children of either spouse by a
a. If full ownership was vested before the marriage previous marriage.
– it shall belong to the buyer- spouse
(Illustration: contract of sale was perfected For illegitimate For illegitimate
before the marriage and full payment was made children, support from children, support from
during marriage using CP); or separate property of separate property of
person obliged to give person obliged to give
b. If full ownership was vested during the marriage support. In case of support. In case of
– it shall belong to the conjugal partnership insufficiency or insufficiency or
(Illustration: contract to sell entered into before absence of separate absence of separate
the marriage but ownership was transferred property, ACP shall property, CP shall
during marriage) advance advance support,
suppo chargeable to share of
In both cases, there is reimbursement upon rt,chargeable to share parent upon
liquidation. In (1), owner-spouse reimburses the CP. of parent upon liquidation, but only
In (2), CP shall reimburse the buyer- spouse liquidation. after obligationsin Art.
(FAMILY CODE, Art. 118). 121 have been
covered.
Improvement of Exclusive Property using CPG
Funds /Reverse Accession Debts and Obligations Contracted During
If the cost of the improvement and any resulting Marriage
increase in value are more than the value of the 1. By the administrator spouse designated in
principal property at the time of the improvement, MS/appointed by court/one assuming sole
the entire property shall belongto CPG subject to administration;
reimbursement of the valueof the principal property 2. By one without the consent of the other;
at the time of the improvement to the owner-spouse 3. By one with the consent of other; and
(e.g.: the CP built a 10-million peso house in a 5- 4. By both spouses.
million peso(exclusive property) land and as a result
the value of the property went up to P18M) (FAMILY For (1) and (2), creditor has burden of proving
CODE, Art. 120, Par. 2). benefit to family and ACP/CPG chargeable to
extent of benefit proven, otherwise, chargeable
Accession to separate property of obligor spouse.
If the cost of the improvement and plus value is equal
to or is less than the value of the principalproperty at For (3) and (4), benefit to family presumed.
the time of the improvement, the entire property
remains the exclusive property of the spouse, All taxes, liens, charges and expenses upon
subject to reimbursement of the cost of improvement thecommunity or conjugal property.
(e.g.: the CP built a 10-million peso house in a 15-
millionpeso (exclusive property) land and as a result Taxes and Expenses Taxes and Expenses
the value of the property went up to P25M). for mere preservation for mere preservation
during marriage upon during marriage upon
The obligation to reimburse rests on the spouseupon separate property of separate property of
whom ownership of the entire property is vested, but either spouse used by either spouse,
there is no obligation on the part of the purchaser of family. regardless of whether
the property in case the property is sold by the or not used by family
owner-spouse (Ferrer v. Ferrer, G.R. No. 166496, because use and
November 29, 2006). enjoyment of separate
property of the
spouses belong to the
partnership.

Expenses to enable either spouse to

commence/complete a professional, vocational
or other activity for self-improvement.
 ACP (Art. 94) CPG (Art. 121) PROVISIONS COMMON TO ACP AND
CPG
Value donated/promised by both spouses in a. Administration of Property (FAMILY
favor of common legitimate children for CODE, ACP: Art. 96-98/ CPG: Art. 124-125)
exclusive purpose of commencing or completing
professional or vocational course or other activity GENERAL RULE: Administration shall belong
for self- improvement. to both spouses jointly (FAMILY CODE, Art.
96).
Expenses of litigation between spouses unless
suitfound to be groundless. EXCEPTIONS:
i. In case of disagreement, husband’s
1. Ante-Nuptial Debts For Ante-Nuptial Debts, decision shall prevail, subject torecourse to
Chargeable to ACP same as ACP but in the court by the wife for proper remedy
if redounded to case of insufficiency of within 5 years from date of contract
benefit of family; separate property, implementing such decision;
2. Personal debts not obligations enumerated ii. In case one spouse is incapacitated or
redounding in Art. 121 must first be unable to participate in theadministration of
to benefit of family satisfied before such the common properties, the other spouse
such as liabilities debts may be may assume sole powers of administration
incurred by reason chargeable to the CP. (FAMILY CODE, Art. 96 par. 2).
of crime or quasi-
delict, chargeable to These powers do not include:
separate property of 1.) Disposition; and
debtor spouse; 2.) Encumbrance.
3. In case of
insufficiency of Written consent of other spouse or authority
separate property, of the court is required; otherwise,
chargeable to ACP disposition or encumbrance is void
but considered (FAMILY CODE, Art. 96 par. 2).
advances
deductible from Spouses are Joint Administrators
share of debtor- The husband and wife are the joint
spouse upon administrators of their properties forming part
liquidation. of the conjugal partnership and absolute
community of properties. The rightvested upon
NOTE: The spouses shall be solidarily liable with them to one-half (½) of the conjugal assets
their separate properties for the obligations if the does not vest until the dissolution and
community or conjugal properties are insufficient. liquidation of the conjugal partnership. The sale
by the husband of property belonging to the
Benefits that might accrue to a husband in his conjugal partnership or the absolute
signing a surety or guarantee agreement not infavor community without the consent of the wife or
of the family, but in favor of his employer corporation, authority of the court is void (Abalos v.
are not benefits that can be considered as giving a Macatangay,G.R. No. 155043, September 30,
direct advantage accruing to the family. Hence, the 2004).
creditors cannot go against the conjugal partnership
property in satisfying the obligation subject of the Contract is void when made without
surety agreement. A contrary view would put in peril consent and knowledge of one spouse; and
the conjugal partnership property by allowing it to be annullable when made with knowledge but
given gratuitously similar to cases of donation of without consent
conjugal partnership property, which is prohibited If the husband, without knowledge and consent
(Security Bank v. Mar Tierra Corp., G.R. No. of the wife, sells conjugal property, such sale is
143382, November 29, 2006). void. If the sale was with the knowledge but
without the approval of the wife, thereby
resulting in a disagreement, such sale is
The conjugal partnership is not liable for an annullable at the instance of the wife who is
indemnity agreement entered into by the husband given five (5) years from the date the contract
to accommodate a third party (Security Bank v. Mar implementing the decision of the husband to
Tierra Corp., G.R. No. 143382, November 29, 2006). institute the case (Ravina v. Villa Abrielle, G.R.
No. 160708, October 16, 2009).
 Continuing offer
The transaction, however, shall be construed
as a continuing offer on the part of the
consenting spouse and the third person, until
acceptance by the other spouse or
authorization by the court before the offer is
withdrawn by either or both offerors (FAMILY
CODE, ACP: Art. 96, par. 2; CPG: Art. 124,
par. 2; Flores v. Sps. Lindo, G.R. No. 183984,
April 13, 2011).
Prohibition on Donation
Neither spouse may donate any community
property without the consent of the other but
either may, without the other’s consent, make
moderate donations for charity or on occasions
of family rejoicing or family distress (FAMILY
CODE, ACP: Art. 98; CPG: Art. 125).
The prohibition also applies to parties living
together as husband and wife without valid
marriage (SEMPIO – DIY, supra at 174).
EXCEPTION: In ACP, either spouse may
dispose by will of his or her interest in the ACP
(FAMILY CODE, Art. 97).
b. Remedies of Present Spouse in Case of
Abandonment by The Other Spouse or
Failure to Comply with Obligations:
(RJA)
i. Receivership;
ii. Judicial separation of property; and
iii. Authority to be the sole administrator of the
community or conjugal property. (FAMILY
CODE, ACP: Art. 101; CPG: Art. 128).
Presumption of Abandonment
A spouse is deemed to have abandoned the
other when he or she has left the conjugal
dwelling without any intention of returning. Three
(3) months disappearance or failure to give
within the same period any information as to a
spouse’s whereabouts prima facie raises a
presumption that the absent spouse has no
intention of returning(FAMILY CODE, ACP: Art.
101 par. 3; CPG: Art. 128, par. 3).
c. Grounds for Dissolution (FAMILY CODE,
[ACP] Art. 99-101; [CPG] Art. 126-128):
(SAD-JR)
i. When there is a decree of legal
Separation;
ii. When the marriage is Annulled or
declared void;
iii. Upon the Death of either spouse;
iv. In case of Judicial separation of property
during the marriage under Articles 134 to
138 (FAMILY CODE, Art. 99); or
v. Upon the filing of an affidavit of
Reappearance of the absent spouse.
Liquidation after affidavit of
Reappearance
Another instance when an absolute
community of property or a conjugal
partnership of gains is dissolved is when a
reappearing spouse or an interested person
under Art. 41 files an affidavit of
appearances to terminate the subsequent
marriage of the present spouse contracted
with another person. According to Art. 43 the
termination of subsequent marriage shall
result in the dissolution of the absolute
community property or conjugalpartnership
of gains of such subsequent marriage
(STA.MARIA, supra at 497)
Separation in Fact (De Facto Separation)
(FAMILY CODE, ACP: Art. 100; CPG: Art. 127).
The separation in fact between husband and
wife shall not affect the regime of ACP/CPG
(FAMILY CODE, Art. 100 par.1).
Rules Applicable when there is De Facto
Separation:
i. The spouse who leaves the conjugal home
or refuses to live therein, without just cause,
shall not have the right to be supported;
ii. When the consent of one spouse to any
transaction of the other is required by law,
judicial authorization shall be obtained in a
summary proceeding; and
iii. In the absence of sufficient community
property, the separate property of both
spouses shall be solidarily liable for the
support of the family. The spousepresent
shall, upon proper petition in a summary
proceeding, be given judicial authority to
administer or encumber any specific
separate property of the other spouse and
use the fruits or proceeds thereof to satisfy
the latter's share (FAMILY CODE, Art. 100).
d. Steps in Liquidation of ACP and CPG
(FAMILY CODE, Art. 102 and 129)
i. Inventory of ACP or CPG properties and
exclusive property of each spouse;
Reason: Separate property is included
because if the community property is not
enough the spouses are liable solidarily with
their separate property (1PARAS, supra at
551; RABUYA, supra at 448).
Receivable from Each Spouse Should
Also Include Receivables from Each
Spouse For:
1.) Amounts advanced for personal debts
 of each spouse;
2.) Support of illegitimate children of either
spouse; and
3.) For CPG, include value of
improvements constructed on separate
property.
ii. Payment of ACP or CPG debts;
Must first pay out of the ACP or CPG
property, if insufficient, spouses are
solidarily liable with separate properties.
iii. For CPG, must first reimburse spouse for
separate property acquired by CP due to
improvements thereon using CPG funds;
iv. For CPG, unless owner is indemnified from
whatever source, payment for the loss or
deterioration of movables belonging to
either spouse that was used for the benefit
of the family shall be made even if due to
fortuitous event;
v. Division of net assets (for ACP) or net profits
(CPG), which are not subject to forfeiture;
vi. Delivery of presumptive legitime, if any, to
the children; and
vii. Adjudication of conjugal dwelling and lot.
e. Termination Caused by Death of Either
Spouse (FAMILY CODE, Art. 103 and
130)
i. ACP and CPG shall be liquidated in a
proceeding for settlement of estate of the
deceased spouse;
ii. If no judicial settlement proceeding is
instituted, the ACP or CPG shall be,
judicially or extra-judicially, liquidatedby the
surviving spouse within 1 year from the
death of the deceased spouse.
If there are debts to be paid, the surviving
spouse must file a proceeding for the
settlement of estate;
iii. If the 1-year period has already
lapsed and no liquidation was made, any
disposition or encumbrance of the ACP or
CPG shall be void; or
iv. If the surviving spouse contract a
subsequent marriage withoutliquidating the
ACP or CPG, mandatoryregime of complete
separation of property shall govern the
property relations of the subsequent
marriage.

COMPARISON OF ACP AND CPG

ABSOLUTE COMMUNITY OF PROPERTY CONJUGAL PARTNERSHIP OF GAINS

As to Commencement & Waiver

The absolute community of property shall commence
at the precise moment that the marriage is celebrated.
Any stipulation, express or implied, for the
commencement of the community regime at any other
time shall be void (FAMILY CODE, Art. 88).
The conjugal partnership of gains shall commence at
the precise moment that the marriage is celebrated.
Any stipulation, express or implied, for the
commencement of the community regime at any other
time shall be void.

No waiver of rights, interests, shares and effects of the No waiver of rights, interests, shares and effects of the
absolute community property during the marriage can conjugal partnership of gains during the marriage can
be made except in case of judicial separation of be made except in case of judicial separation of
property (FAMILY CODE, Art. 89 par. 1). property (FAMILY CODE, Art. 107).

As to Inclusion in the Property Regime

Unless otherwise provided in this Chapter or in the
marriage settlements, the community property shall
consist of all the property owned by the spouses at the
time of the celebration of the marriage or acquired
thereafter (FAMILY CODE, Art. 91).
All property acquired during the marriage, whether the
acquisition appears to have been made, contracted or
registered in the name of one or both spouses, is
presumed to be conjugal unless the contrary is proved
(FAMILY CODE, Art. 116).

Property acquired during the marriage is presumed to The following are conjugal partnership properties:
belong to the community, unless it is proved that it is 1. Those acquired by onerous title during the marriage
one of those excluded therefrom (FAMILY CODE, Art. at the expense of the common fund, whether the
93). acquisition be for the partnership, or for only one of
the spouses;
2. Those obtained from the labor, industry, work or
 ABSOLUTE COMMUNITY OF PROPERTY CONJUGAL PARTNERSHIP OF GAINS

profession of either or both of the spouses;

3. The fruits, natural, industrial or civil, due or received
during the marriage from the common property, as
well as the net fruits from the exclusive property of
each spouse;
4. The share of either spouse in the hidden treasure
which the law awards to the finder or owner of the
property where the treasure is found;
5. Those acquired through occupation such as fishing
or hunting;
6. Livestock existing upon the dissolution of the
partnership in excess of the number of each kind
brought to the marriage by either spouse; and
7. Those which are acquired by chance, such as
winnings from gambling or betting. However, losses
therefrom shall be borne exclusively by the loser-
spouse (FAMILY CODE, Art. 117).

Property bought on installment paid partly from the

exclusive funds of either or both spouses and partly
from the conjugal funds conjugal funds belongs to the
buyer or buyers if full ownership was vested before the
marriage and to the conjugal partnership if such
ownership was vested during the marriage (FAMILY
CODE, Art. 118).

Interests falling due during marriage on the principal

credit belonging to one spouse (FAMILY CODE, Art.
119).

As to Exclusive Property of the Spouses

1. Property acquired during the marriage by
gratuitous title by either spouse, and the fruits as
well as the income thereof, if any, unless it is
expressly provided by the donor, testator or grantor
that they shall form part of the community property;
2. Property for personal and exclusive use of either
spouse. However, jewelry shall form part of the
community property;
3. Property acquired before the marriage by either
spouse who has legitimate descendants by a
former marriage, and the fruits as well as the
income, if any, of such property (FAMILY CODE,
Art. 92).
1. That which is brought to the marriage as his or her
own;
2. That which each acquires during the marriage by
gratuitous title;
3. That which is acquired by right of redemption, by
barter or by exchange with property belonging to
only one of the spouses; and
4. That which is purchased with exclusive money of
the wife or of the husband (FAMILY CODE, Art.
109).

As to Games of Chance

Whatever may be lost during the marriage in any game of chance, betting, sweepstakes, or any other kind of
gambling, whether permitted or prohibited by law, shall be borne by the loser and shall not be charged to the
community/conjugal partnership but any winnings therefrom shall form part of the community/conjugal
partnership property (FAMILY CODE, APC-Art. 95, CP- Art. 123).

As to Administration

The administration and enjoyment of the community property/conjugal partnership property shall belong to both
 ABSOLUTE COMMUNITY OF PROPERTY CONJUGAL PARTNERSHIP OF GAINS

spouses jointly. In case of disagreement, the husband’s decision shall prevail, subject to the recourse to the
court by the wife for a proper remedy, which must be availed of within five years from the date of the contract
implementing such decision (FAMILY CODE, ACP – Art. 96, CP- Art. 124).

Neither spouse may donate any community property/conjugal partnership property without the consent of the
other. However, either spouse may, without the consent of the other, make moderate donations from the
community property for charity or on occasion of family rejoicing or family distress (FAMILY CODE, Art. 98, Art.
125).

Either spouse may dispose by will of his or her interest in the community property (FAMILY CODE, Art. 97).

As to Termination

1. Upon the death of either spouse;

2. When there is a decree of legal separation;
3. When the marriage is annulled or declared void; or
4. In case of judicial separation of property during marriage under Arts. 134-138 (FAMILY CODE, ACP- Art.
99,CP – Art. 126).

As to Effect of Separation in Fact to the Property Regime

1. The spouse who leaves the conjugal home or refuses to live therein, without just cause shall not have the
right to be supported;
2. When the consent of one spouse to any transaction of the other is required by law, judicial authorization
shall be obtained in a summary proceeding;
3. In the absence of sufficient community property, the separate property of both spouses shall be solidarily
liable for the support of the family. The spouse present shall, upon proper petition in a summary proceeding,
be given judicial authority to administer or encumber any specific or separate property of the other spouse
and use the fruits or proceeds thereof to satisfy the latter’s share (FAMILY CODE, ACP- Art. 100, CP- Art.
127).

As to Remedy in Case of Abandonment

If a spouse without just cause abandons the other or fails to comply with his or her obligations to the family, the
aggrieved spouse may petition the court for receivership, for judicial separation of property or for authority to
be the sole administrator of those absolute community/conjugal partnership property, subject to such
precautionaryconditions as the court may impose (FAMILY CODE, ACP- Art. 101 par.1, CP- Art. 128 par.1).

As to Procedure on the Dissolution of Property Regime

1. An inventory shall be prepared, listing separately
allthe properties of the absolute community and
the exclusive properties of each spouse;
2. The debts and obligations of the absolute
community shall be paid out of its assets. In case
ofinsufficiency of said assets, the spouses shall
be solidarily liable for the unpaid balance with
their separate properties in accordance with the
provisions of the second paragraph of Art. 94;
3. Whatever remains of the exclusive properties of
thespouses shall thereafter be delivered to each
of them;
4. The net remainder of the properties of the
absolute community shall constitute its net assets,
which shall be divided equally between husband
and wife,unless a different proportion or division
was agreed upon in the marriage settlements, or
unless there has been a voluntary waiver of such
share as provided in this Code. For purposes of
1. An inventory shall be prepared, listing separately
all the properties of the conjugal partnership and
the exclusive properties of each spouse;
2. Amounts advanced by the conjugal partnership in
payment of personal debts and obligations of either
spouse shall be credited to the conjugal
partnershipas an asset thereof;
3. Each spouse shall be reimbursed for the use of his
or her exclusive funds in the acquisition of property
or for the value of his or her exclusive property, the
ownership of which has been vested by law in the
conjugal partnership;
4. The debts and obligations of the conjugal
partnership shall be paid out of the conjugal
assets.In case of insufficiency of said assets, the
spouses shall be solidarily liable for the unpaid
balance with their separate properties, in
accordance with the provisions of paragraph (2) of
Art. 121;
 ABSOLUTE COMMUNITY OF PROPERTY CONJUGAL PARTNERSHIP OF GAINS

computing the net profits subject to forfeiture in
accordance with Arts.43, No. (2) and 63, No. (2),
the said profits shall be the increase in value
between the market value of the community
property at the time of the celebration of the
marriage and the market value at the time of its
dissolution;
5. The presumptive legitimes of the common
children shall be delivered upon partition, in
accordance withArt. 51; and
6. Unless otherwise agreed upon by the parties, in
the partition of the properties, the conjugal
dwelling andthe lot on which it is situated shall be
adjudicated to the spouse with whom the majority
of the common children choose to remain.
Children below the age of seven years are
deemed to have chosen the mother, unless the
court has decided otherwise. In case there is no
such majority, the court shall decide, taking into
consideration the best interests of said children
(FAMILY CODE, Art. 102).
5. Whatever remains of the exclusive properties of
thespouses shall thereafter be delivered to each of
them;
6. Unless the owner had been indemnified from
whatever source, the loss or deterioration of
movables used for the benefit of the family,
belonging to either spouse, even due to fortuitous
event, shall be paid to said spouse from the
conjugal funds, if any;
7. The net remainder of the conjugal partnership
properties shall constitute the profits, which shall
be divided equally between husband and wife,
unless a different proportion or division was
agreed uponin the marriage settlements or unless
there has been a voluntary waiver or forfeiture of
such share as provided in this Code;
8. The presumptive legitimes of the common children
shall be delivered upon partition in accordance with
Art. 51; and
9. In the partition of the properties, the conjugal
dwelling and the lot on which it is situated shall,
unless otherwise agreed upon by the parties, be
adjudicated to the spouse with whom the majority
of the common children choose to remain. Children
below the age of seven years are deemed to have
chosen the mother, unless the court has decided
otherwise. In case there is no such majority, the
court shall decide, taking into consideration the
best interests of said children (FAMILY CODE, Art.
129).

As to Procedure in Case of Termination of Marriage by Death

Upon the termination of the marriage by death, the conjugal partnership property shall be liquidated in the same
proceeding for the settlement of the estate of the deceased.

If no judicial proceeding is instituted, the surviving spouse shall liquidate the community or conjugal partnership
property either judicially or extra-judicially within one year from the death of the deceased spouse. If upon the
lapse of the one-year period no liquidation is made, any disposition or encumbrance involving the conjugal
partnership property of the terminated marriage shall be void.

Should the surviving spouse contract a subsequent marriage without compliance with the foregoing
requirements, a mandatory regime of complete separation of property shall govern the property relations of
thesubsequent marriage (FAMILY CODE, ACP- Art. 103, CP – Art. 130).

Rule on Marriages Prior to the Family Code

Whenever the liquidation of the community or conjugal partnership properties of two or more marriages
contracted by the same person before the effectivity of this Code is carried out simultaneously, the respective
capital, fruits and income of each community or partnership shall be determined upon such proof as may be
considered according to the rules of evidence. In case of doubt as to which community or partnership the
existing properties belong, the same shall be divided between or among the different communities or
partnerships in proportion to the capital and duration of each (FAMILY CODE, ACP: Art. 104, CPG: Art. 131).
3. REGIME OF SEPARATION OF
PROPERTY
It may refer to present or future property or both,total
or partial. If partial, ACP shall govern properties not
agreed upon as separate (FAMILY CODE, Art. 144).
a. Each spouse shall own, dispose of,
possess, administer and enjoy his or her
own separate estate, without need of the
consent of the other. To each spouse shall
belong all earnings from his or her
profession, business or industry and all
fruits, natural, industrial or civil, due or
received during the marriage from his or her
separate property (FAMILY CODE, Art.
145).
b. Both spouses shall bear the family
expenses in proportion to their income, or,
in case of insufficiency or default thereof, to
the current market value of their separate
properties. The liabilities of the spouses to
creditors for family expenses shall,
however, be SOLIDARY. (FAMILY CODE,
Art. 146).
c. Without legal separation, a wife convicted of
adultery is not disqualified from sharing in
the conjugal partnership properties. A
Compromise Agreement which was
judicially approved is exactly such a
separation of property allowed under the
law. However, voluntary separation of
property is subject to the rights of all
creditors of the conjugal partnership of gains
and other persons with pecuniary interest
pursuant to Art. 136 of the Family Code
(Maquilan v. Maquilan, G.R. No. 155409,
June 8, 2007).
d. The requirement under R.A. No. 6713 and
similar laws that the SALN to be filed by
every government official must include
assets, liabilities, and net worth of the
spouse of the filer is construed not to include
the assets, liabilities, and net worth of
spouses whose property regime during the
marriage is by law or by agreementprior to
the marriage one of complete separation of
property. Article 38 of the Code of Muslim
Personal Laws specifically defines their
regime of property relations as Muslims
to be one of complete separation of
property. In view of Section 38 of the Code
of Muslim Personal Laws, the exemption of
Babano from the disclosure requirement
should be clear and undisputed (Abid-
Babano v. Executive Secretary, G.R. No.
201176, August 28, 2019).
NOTE: This should also apply to the Family Code
provisions on Complete Separation of Property.
4. SEPARATION OF PROPERTY AND
ADMINISTRATION OF COMMON
PROPERTY BY ONE SPOUSE
DURING THE MARRIAGE
In the absence of an express declaration in the
marriage settlements, separation of property during
the marriage shall not take place except by a judicial
order. Such judicial separation of property may
either be voluntary or for sufficient cause (FAMILY
CODE, Art. 134).
Causes of Judicial Separation of Property:
(SCALOP)
a. That at the time of the petition, the spouses have
been Separated in fact for at leastone (1) year
and reconciliation is highly improbable;
b. That the spouse of the petitioner has been
sentenced to a penalty which carries with it Civil
interdiction;
c. That the spouse of the petitioner has been
judicially declared an Absentee;
d. That Loss of parental authority of the spouse of
petitioner has been decreed by the court;
e. That the spouse of the petitioner has abandoned
the latter or failed to comply with his or her
Obligations to the family as provided for in Article
101; and
f. That the spouse granted the Power of
administration in the marriage settlements has
abused that power (FAMILY CODE, Art. 135).
NOTE: In the cases provided for in b, c, d above,
presentation of final judgment against guilty or
absent spouse shall be enough basis for grant
of decree of judicial separation of property
(FAMILY CODE, Art. 135).
Effects of Judicial Separation of Property
a. Dissolution and liquidation of ACP/CPG
(FAMILY CODE, Art. 137);
b. Liability of the spouses to creditors shall be
solidary with their separate properties;
c. Mutual obligation to support each other
continues except when there is legal separation;
and
d. Rights previously acquired by creditors are not
prejudiced (FAMILY CODE, Art. 140).
REVIVAL OF FORMER PROPERTY REGIME
(CAT-PALS)
It shall be governed by Art. 67 and may be filedin the
same proceedings where separation of property was
decreed in any of the following instances:
a. When the Court, being satisfied that the
spouse granted the power of administration
in the marriage settlements will not again
abuse that power, authorizes the
resumption of said administration;
b. When the Absentee spouse reappears; 5. PROPERTY REGIME OF UNIONS
c. When the civil interdiction Terminates; WITHOUT MARRIAGE
d. When Parental authority is judiciallyrestored
to the spouse previously deprived thereof;
e. When after voluntary dissolution of the ART. 147 v. ART. 148
absolute community of property or conjugal UNIONS BETWEEN UNIONS
partnership has been judicially decreed PERSONS BETWEEN
upon the joint petition of the spouses, they CAPACITATED TO PERSONS NOT
Agree to the revival of the former property MARRY CAPACITATED
regime. No voluntary separation of property (ART. 147) TO MARRY
may thereafter be granted; (ART. 148)
f. When the spouse who has Left the conjugal
home without a decree of legal separation As to Applicability
resumes common life with the other; or
g. When the spouses who have Separated in The following must 1. In cases of
fact for at least one year, reconcile and concur: cohabitation not
resume common life (FAMILY CODE, Art. 1. Parties must be falling under Art.
141). both capacitated to 147.
marry each other;
Administration of Exclusive Property 2. They live Parties are not
(FAMILY CODE, Art. 142) exclusively with capacitated to
a. The administration of all classes of each other as marry each other
exclusive property of either spouse may be husband and wife; due to some legal
transferred by the court to the other spouse 3. Without the benefit impediments,
(GACH): of marriage or although it may
i. When one spouse becomes under a void also fall under a
the Guardian of the other marriage (par. 1): void marriage.
ii. When one spouse is judicially a. Void marriages
declared an Absentee; under Art. 35; 2. Incestuous
iii. When one spouse is sentenced to a i. Those marriages under
penalty which carries with it Civil solemnized Art. 37;
interdiction; or by any 3. Void marriages
iv. When one spouse becomes a person not against public
fugitive from justice or is in Hiding as legally policy under Art.
an accused in a criminal case (par. authorized 38;
1). to perform 4. Void marriages
marriages; under Art. 35,
b. If the other spouse is not qualified by reason ii. Those Pars. 1(below 18)
of incompetence, conflict of interest, or any solemnized and 4 (bigamous
other just cause, the court shall appoint a without a or polygamous);
suitable person to be the administrator (par. license; 5. Void Marriages
2). iii. Mistake in under Article 44
identity.

b. Void marriages
based on
psychological
incapacity
under Art. 36; or

c. Marriages that
are void under
4. Art. 53 when either
of the former
spouses marries
again without
complying with the
requirements of
registration of
judgment of
 UNIONS BETWEEN UNIONS UNIONS BETWEEN UNIONS
PERSONS BETWEEN PERSONS BETWEEN
CAPACITATED TO PERSONS NOT CAPACITATED TO PERSONS NOT
MARRY CAPACITATED MARRY CAPACITATED
(ART. 147) TO MARRY (ART. 147) TO MARRY
(ART. 148) (ART. 148)

annulment, the other until after the

partition, and termination of their
delivery of cohabitation (par.3).
presumptive
legitimes. As to Forfeiture

As to Salaries and Wages When only one of the 1. If one of the parties
parties to a void is validly married to
Owned in equal shares Separately owned by marriage is in good faith, another, his or her
(par. 1). the parties. If any of the share of party in bad share in the co-
them is married, faith in the co- ownership shall
his/her salary is the ownership shall be accrue to the ACP
property of the ACP or forfeited: or CPG existing in
CPG of the legitimate 1. In favor of their such valid
marriage (par.2). common children; marriage;
2. In case of default or 2. If the party who
As to Property Acquired by Own Funds waiver by any or all acted in bad faith is
common children or not validly married
Belongs to such party Belongs to such party. their descendants to another, his/her
subject to proof of each vacant share share shall be
acquisition by exclusive shall belong to the forfeited in the
funds (par.1). respective surviving same manner
As to Property Acquired Through Their Joint descendants; or provided for in Art.
Work/Industry 3. In their absence, to 147; and
the innocent party. 3. The above rules
Governed by rules on Owned by them in apply even if both
co-ownership (par.1). common in proportion In all cases, forfeiture parties are in bad
to respective actual takes place upon faith (par.2).
joint contributions termination of
(par.1) cohabitation (par.4).

As to Property Acquired While Living

Tender Loving Care Doctrine
Together
The relationship between a man and a woman
Presumed to be No presumption of joint whose marriage was subsequently declared null and
obtained by their joint acquisition. When void on the ground of psychological incapacity is
efforts, work, or industry there is evidence of governed by Art. 147 of the Family Code. Under this
and shall be owned by joint acquisition but provision, there exists a presumption that
them in equal shares. none as to the extent of contributions made during the marriage are equal.
Efforts in care and actual contribution, Even if one of the parties did not contribute
maintenance of family there is a presumption materially to the common fund, but the said party
and household of equal contributions took care of the household, the other party and their
considered contribution and shares (par.1). common children, these acts are considered the said
in acquisition (par.2). party’s contribution to the common fund
(Buenaventura v. CA, G.R. Nos. 127358 & 127449,
NOTE: Neither party March 31, 2005).
can encumber or
dispose by acts inter NOTE: In contrast, Art. 148 provides no presumption
vivos of his or her share of joint acquisition. It must be stressed that actual
in the property acquired contribution is required by this provision, as opposed
during cohabitation and to Art. 147 which states that efforts in the care and
owned in common maintenance of the family and household, are
without the consent of regarded as contributions to the acquisition of
common property by one who has no salary or
income or work or industry. Under Art. 148, if the
actual contribution of the party is not proved, there
will be no co-ownership and no presumption of equal
shares (Agapay v. Palang, G.R. No. 116668, July
28, 1997). Hence, mere cohabitation without proof of
contribution will not result in a co-ownership (Tumlos
v. Sps. Fernandez, G.R. No. 137650, April 12,
2000).
Only properties acquired by them through their
actual joint contribution of money, property, or
industry shall be owned by them in common in
proportion to their respective contributions. The
words “married to” preceding the name of spouse
are merely descriptive of the civil status of the
registered owner. Such words do not prove co-
ownership. Without proof of actual contribution from
either or both spouses, there can be no co-
ownership under Art. 148 of the Family Code (Go-
Bangayan v. Bangayan, Jr., G.R. No. 201061, July
3, 2013).
THE FAMILY
(ARTS. 149-162)
The family, being the foundation of the nation, is a
basic social institution which public policy cherishes
and protects (FAMILY CODE, Art. 149); therefore,
no suit between members of the same family shall
prosper unless earnest efforts for a compromise
between the parties have failed (FAMILY CODE, Art.
151, par.1). Family relations are governed by law
and no custom, practice or agreement destructive of
the family shall be recognized or given effect
(FAMILY CODE, Art. 149).
FAMILY RELATIONS INCLUDE:
(HW-PC-AD-BS)
1. Between Husband and Wife;
2. Between Parents and Children;
3. Among other Ascendants and Descendants;
and
4. Among Brothers and Sisters whether full orhalf–
blood (FAMILY CODE, Art. 150).
MANDATORY PRIOR RECOURSE TO
COMPROMISE
GENERAL RULE: No suit between members of
the same family shall prosper unless it should
appearfrom the verified complaint or petition that
earnest efforts toward a compromise have been
made, butthat the same have failed. If it is shown
that no such efforts were in fact made, the same
case mustbe dismissed (FAMILY CODE, Art. 151,
par. 1).
EXCEPTIONS:
1. When a stranger is involved in the suit;
REASON: The interest of such stranger may
differ from the interest of members of the same
family (STA.MARIA, supra at 620).
2. In cases where a compromise is not
allowed: (F2AC-J-VHSG)
a. Future support;
b. Future legitime;
c. Any ground for legal separation;
d. Civil status of persons;
e. Jurisdiction of courts
f. Validity of marriage or a legal separation
(CIVIL CODE, Art. 2035);
g. Petition for Habeas corpus (Tribiana v.
Tribiana, G.R. 137359, September 13,
2004); and
h. Petition for Settlement of estate
i. Guardianship and custody of children
(Martinez v. Martinez, G.R. No. 162084,
June 28, 2005) (STA. MARIA, supra at
620).
NOTE: For Article 151 of the Family Code to apply,
the suit must be exclusively between or among
"members of the same family" (Moreno v. Kahn,G.R.
No. 217744, July 30, 2018).
Term “Suit” Limited to Civil Action or Civil
Liability
The term “suit” provided by law clearly implies only
civil actions (Manalo v. CA, G.R. No. 129242,
January 16, 2001).
On the other hand, Art. 332 of the Revised Penal
Code provide for exemption from criminal, but not
civil liability, for the crimes of theft, swindling or
malicious mischief committed or caused by the
following:
1. Spouses, ascendants and descendants, or
relative by affinity in the same line;
2. The widowed spouse with respect to the
property which belonged to the deceased
spouse before the same shall have passed into
the possession of another; and
3. Brothers and sisters and brothers-in-law and
sisters-in-law, if living together.
NOTE: The exemption established by Article 332 of
the Revised Penal Code shall not be applicable to
strangers participating in the commission of the
crime (STA. MARIA, supra at 620-621).
RUNNING OF PRESCRIPTIVE PERIODS
Unless otherwise provided by the Family Code and
other laws, Art. 1109 of the Civil Code provides that
prescription does not run between:
1. Husband and wife, even though there be a
separation of property agreed upon in the
marriage settlements or by judicial decree;
2. Parents and children during the latter’s minority
or insanity; and
3. Guardian and ward during the continuance of
the guardianship (STA.MARIA, supra. at 624).
FAMILY HOME
It is constituted jointly by the husband and the wife
or by an unmarried head of the family. It is the
dwelling house where they and their family reside,
and the land on which it is situated. (FAMILY CODE,
Art. 152).
The requirement of a house and land as constitutive
of a family home stresses the element of
permanence. Hence, a boat on a water cannot be
constituted a family home. The occupancy must be
actual and not constructive. One cannot claimthat
he or she has occupied the premises at the time his
or her overseer, maid, houseboy or driver has lived
in the said place because occupancy by the one
claiming the house as a family home must be actual
and not constructive (STA.MARIA, supra at 625).
GENERAL RULE: The family home is exempt from
execution, forced sale or attachment (FAMILY
CODE, Art. 155).
COMMENCEMENT OF EXEMPTION:
Exemption is effective from the time of the
constitution of the family home as such and lasts so
long as any of its beneficiaries actually resides
therein (Spouses Kelley, Jr. v. Planters Products,
Inc., G.R. No. 172263 (Resolution), July 9, 2008).
REASON: When the creditors seize the family
house, they virtually shatter the family itself (1
PARAS, supra at 663).
EXCEPTIONS: (P-LMT)
1. Debts incurred Prior to constitution of the family
home (FAMILY CODE, Art. 155);
As a rule, the family home is exempt from
execution, forced sale or attachment. However,
Art. 155(3) of the Family Code explicitly allows
the forced sale of a family home “for debts
secured by mortgages on the premises before
or after such constitution” (Sps. Fortaleza v.Sps.
Lapitan, G.R. No. 178288, August 15, 2012).
NOTE: Art. 153 cannot be given retroactive
effect to shield the homes of debtors from
execution of judgment arising from debts which
became due and demandable prior to the
effectivity of the Family Code. To be able to avail
of the benefits of a family home in relation to
debts which matured prior to August 3, 1988, it
must be shown that the home was constituted
either judicially or extrajudicially pursuant to the
old Civil Code (STA.MARIA, supra at 627).
2. Debts due to Laborers, mechanics, architects,
builders, materialmen and others who have
rendered service or furnished materials for the
construction of the building;
3. Debts secured by Mortgages on the premises
before or after constitution of the family home;
and
4. Non–payment of Taxes (FAMILY CODE, Art.
155).
Exemption must be timely raised as a defense
against execution
While it is true that the family home is constituted
on a house and lot from the time it is occupied as a
family residence and is exempt from execution or
forced sale under Article 153 of the Family Code,
such claim for exemption should be set up and
proved to the Sheriff before the sale of the property
at public auction. Failure to do so would estop the
party from later claiming the exemption (Honrado v.
CA, G.R. No. 166333, November 25, 2005; see also
Sps. Araceli & Ernesto de Mesa v. Sps. Acero, G.R.
No. 185064, January 16, 2012).
Remedy against Execution is a motion to quash
A motion to quash is available where the writ of
execution varies the terms of the judgment, or where
it is sought to be enforced against property exempt
from execution (1 REGALADO, Remedial Law
Compendium, (2010) p.453 [hereinafter
REGALADO, Remedial Law]).
OUTLINE OF PROVISIONS REGARDING
THE FAMILY HOME:
1. It is constituted on the dwelling house of the
family and the land on which the house is
situated (FAMILY CODE, Art. 152);
2. Deemed constituted from time of actual
occupation as a family residence (FAMILY
CODE, Art. 153);
3. Continues to be such as long as any of its
beneficiaries actually resides therein (FAMILY
CODE, Art. 153);
4. Must be part of the properties of the absolute
community or the conjugal partnership or own
by person constituting it (may beeither or both
spouses or the unmarried head of a family)
(FAMILY CODE, Art. 156 par. 1);
5. Property that is the subject of a conditional sale
on installments where ownership is reserved by
the vendor only to guarantee payment of the
purchase price may be constituted as a family
 home. (FAMILY CODE, Art. 156, par. 2)
6. There must be a fixed and permanent
connection with the persons constituting it
(STA.MARIA, supra at 631).
7. Rule applies to valid and voidable marriages and
even to common-law spouses under Arts. 147
and 148 of the Family Code; and
8. Continues despite death of one or both spouses
or unmarried head of the family for 10 years, or
as long as a minor beneficiary lives therein.
Heirs cannot partition the same unless the court
finds compelling reasons therefor. This rule
shall apply regardless of whoever owns the
property or constituted the family home (FAMILY
CODE, Art. 159).
Note: If after 10 years from death and a minor
beneficiary still lives therein, the family home
shall be preserved only until that minor
beneficiary reaches the age of majority. The
intention of the law is to safeguard and protect
the interests of the minor beneficiary until he
reaches the age of majority (Patricio v. Dario III,
G.R. No. 170829, November 20, 2006).
Family Home Shielded from Partition
The family home is shielded from immediate
partition under Art. 159 regardless of its
ownership. This signifies that even if the family
home has passed by succession to the co-
ownership of the heirs, or has been willed to
any one of them, this fact alone cannottransform
the family home into an ordinary property, much
less dispel the protection cast upon it by the law.
The rights of the individual co-owner of the
family home cannot subjugate the rights granted
under Art. 159 to the beneficiaries of the family
home (Arriola v. Arriola, G.R. No. 177703,
January 28, 2008).
9. To be a beneficiary (other than the husband
and the wife or an unmarried person who is the
head of the family), the following requisites must
concur:
a. Must be parent, ascendant, descendant,
brother or sister whether legitimate or
illegitimate (FAMILY CODE,Art. 154 par. 2).
b. Must live in the family home (actual
occupancy) (Salazar v. Felias, G.R. No.
213972, February 5, 2018).
c. Must be dependent for legal support upon
the head of the family.
NOTE: A grandson was not considered a
beneficiary of a family home owned by his
grandparent because, while the said grandchild
was living in the said family home, he was not
dependent for support on the grandparent, who
was the head of the family where the grandchild
lived, but on his father (Patricio v. Dario III, G.R.
No. 170829, November 20, 2006).
The enumeration in Article 154 of the Family
Code may include in-laws provided the home is
jointly constituted by husband and wife. But the
law definitely excludes maids and overseers
(Patricio v. Dario III, G.R. No. 170829,
November 20, 2006).
10. A person may constitute or be the beneficiary of
1 family home only (FAMILY CODE, Art. 161).
11. May be alienated, sold, donated, assigned or
encumbered by the owners provided the written
consent of the following are obtained:
a. The person who constituted the same;
b. His or her spouse; and
c. Majority of the beneficiaries of legal age
(FAMILY CODE, Art. 158).
NOTE: In case of conflict, the court shall decide
(FAMILY CODE, Art. 158).
PATERNITY AND
FILIATION
(ARTS. 163-182)
PATERNITY
It is the civil status or relationship of the father to
the child (SEMPIO-DIY, supra at 255).
FILIATION
It is the civil status or relationship of the child to the
father or mother (Id.).
The filiation of children may be by nature or by
adoption. Natural filiation may be legitimate or
illegitimate (FAMILY CODE, Art. 163).
NOTE: Legitimate or illegitimate filiation is fixed by
law and cannot be left to the will of the parties or the
declaration of any physician or midwife (Angeles v.
Maglaya, G.R. No. 153798. September 2, 2005).
LEGITIMATE CHILDREN (MA²VS)
1. Those conceived or born before the judgment
of Annulment or absolute nullity of marriage
under Article 36 has become final and executory
(FAMILY CODE, Art. 54);
2. Product of Artificial insemination of the wife with
the sperm of the husband or that of adonor or
both provided both spouses authorized or
ratified such procedure in a written instrument,
executed and signed before birth of child and
 recorded in the civil registry together with the
birth certificate of the child (FAMILY CODE, Art.
164 par. 2);
3. Those conceived or born during a Valid
marriage (FAMILY CODE, Art. 164 par. 1);
Although the mother may have declared against
its legitimacy or was sentenced as an adulteress
(FAMILY CODE, Art. 167); and
4. Those born in a Subsequent void marriage due
to failure to comply with Arts. 52 and 53
(FAMILY CODE, Art. 54).
ILLEGITIMATE CHILDREN
Conceived and born outside a valid marriage or
inside a void ab initio marriage such as bigamous
and incestuous marriages and marriage declared
void for being contrary to law and public policy
(FAMILY CODE, Art. 165).
LEGITIMATE CHILDREN V.
ILLEGITIMATE CHILDREN
LEGITIMATE ILLEGITIMATE
As to Use of Surname
Right to bear father’s Generally required to
surname. use mother’s surname.
EXCEPTION:
If child’s filiation has
been expressly
recognized by the
father through the
record of birth
appearing in the civil
register, or when an
admission in a public
document or private
handwritten instrument
is made by the father
(R.A. No. 9255, Sec.
1).
As to Parental Authority
Joint authority of Sole parental authority
parents (FAMILY of mother (FAMILY
CODE, Art.211). CODE, Art. 176). But
joint if mother and
father are living
together (FAMILY
CODE, Art. 211).
As to Support
Entitled to receive Entitled to receive
support from any of his support only up to his
or her direct ascendants or her grandparents or
and descendants in grandchildren as
accordance with the provided for in Art. 195,
LEGITIMATE ILLEGITIMATE
priority set by law in Art. pars. 2 and 3
195 and 199 of Family (STA.MARIA, supra. at
Code (STA.MARIA, p. 686).
supra at 686). Entitled to
support from brothers Support from legitimate
and sisters sibling subject to the
condition in Article 196.
Preferential right to No such preference.
support over mother if
father has no sufficient Conjugal partnership/
means to meet both absolute community
claims. property is only
secondarily liable for
Conjugal partnership of the support of
gains and absolute illegitimate children
community of property since primary
are primarily liable responsibility falls on
(FAMILY CODE, Arts. the parent’s
94, par. 1 and Art 121, exclusive
par. 1). property (FAMILY
CODE, Arts. 94, par. 9
and 122, par. 3).
As to Successional Right
Entitled to a legitime of Legitime is 1/2 of the
½ of the hereditary legitime of a surviving
estate of the father and legitimate child (CIVIL
of the mother (CIVIL CODE, Art. 991).
CODE, Art. 888).
As to Right under the SSS (R.A. 8282) and
GSIS (R.A. 8291)
Primary beneficiary. Not primary
beneficiaries.
As to Effect of Paternity Leave under R.A. No.
8187 (Paternity Leave Act of 1996)
Father is entitled to No such benefit.
paternity leave of 7 days
with full pay.
As to Prohibition of Marriage with Adopted
Children
A marriage between an No such prohibition
adopted child and a between a marriage
legitimate child of the between an adopted
adopter is void as child and an illegitimate
against public policy child of the adopter.
(FAMILY CODE, Art. 38,
par. 7).
ARTIFICIAL INSEMINATION
It is the impregnation of a female with semen from
a male without sexual intercourse. The semen may
be that of a husband, that of a donor, or a
combination of the husband’s and a donor’s semen
(SEMPIO-DIY, supra at 259).
RULE ON CHILDREN CONCEIVED AS A
RESULT OF ARTIFICIAL INSEMINATION
The status of the child is legitimate if all the
requirements under Art. 164 are complied with
namely: (BAR)
1. Both spouses authorize or ratify such
insemination;
2. The Authorization or ratification is in a written
instrument signed by them before the birth of the
child; and
3. The instrument is Recorded in the civil registry
together with the birth certificate of the child.
Note: Even if the above requirements are not
complied with and the husband does not impugn
the legitimacy of the child on grounds provided by
Art. 166 within the prescriptive period, the childshall
still be considered legitimate because the child has
been conceived or born during the valid marriage of
the parents pursuant to Art. 164, par. 1.
RULES ON IMPUGNING LEGITIMACY
Arts. 166 and 167 of the Family Code necessarily
applies only to a situation where the child has been
delivered by a woman who is the child’s natural
mother (STA.MARIA, supra at 645). It does notapply
where the child is alleged not to be the biological
child of a certain couple (Geronimo vs. Santos, G.R.
No. 197099, September 28, 2015).
In the event that any of the grounds enumerated in
Art. 166 is proven, the child will neither be
legitimate nor illegitimate in so far as the husband
is concerned. Simply, the husband and the child will
not be related to each other in any manner
considering that the husband did not participate in
any way as to the child’s procreation. In so far as the
mother is concerned, the child will be considered
illegitimate (Id.).
GROUNDS FOR IMPUGNING
LEGITIMACY: (PBC)
1. Physical impossibility of the husband
to have sexual intercourse with his wife
within the first 120 days of the 300 days
immediately preceding the child’s birth,
due to:
a. Physical incapacity of the husband;
Impotency
Impotency refers to physical inability of male
organ to copulate while sterility is failure to have
a child (1 PARAS, supra at 676).
When Art. 166 speaks of physical incapacity of
the husband to have sexual intercourse with the
wife, the law is referring to impotency, which
imports a total want of power of copulation and,
as a necessary incident thereto, the inability to
procreate. As a result of which, sexual
intercourse or access is physically impossible
(RABUYA, supra at 539).
NOTE: Must be proved by convincing and
persuasive evidence hence, the fact that a
husband, who was never separated from his
wife, has been absolutely stiff in the hips at the
time of the conception of the child has been held
as not conclusive enough to overturn the
presumption of legitimacy (STA.MARIA, supra
at 652).
NOTE: The fact that the husband had
undergone vasectomy is not sufficient proof to
rebut the presumption of legitimacy of a child of
his wife
Vasectomy involves the removal of about an
inch of the tubes or vas deferens which is the
passage way of the sperm from the testicle to
the urethra and tying the remaining ends. The
sperm can re-channel itself and effect a
fertilization (STA.MARIA, supra at 654).
The fact of vasectomy must be coupled with
concrete proof that the husband was entirely
sterile, and that re-channelization did not occur
(Id.).
b. Husband and the wife were
livingseparately in such a way that
intercourse was not possible;
Note: Mere remoteness of the wife from
the husband is not sufficient to disavow
paternity. Hence, the bare testimony by the
husband that he and his wife were living
thirty miles away from each other at thetime
of the conception of the child is not enough
to show the illegitimacy of the child without
any showing that the sexual intercourse with
the wife was not possible (STA.MARIA,
supra at 652).
c. Serious illness of the husband which
absolutely prevented sexual intercourse
Note: Must be such as to absolutely prevent
him from engaging in sexual intercourse.
 Thus, in Andal v. Macaraig, G.R. No. L-
2474, May 30, 1951, the Court ruled that the
fact that the husband was seriously sick with
tuberculosis was not sufficient to overcome
the presumption of legitimacy. Impossibility
of access by husband to wife would include
absence during the initial period of
conception; impotence which is patent,
continuing and incurable; and
imprisonment, unless it can be shown that
cohabitation took place through corrupt
violation of prison regulations.
2. Biological or scientific proof that the
child could not have been that of the
husband; and
NOTE: Racial dissimilarity may be considered
sufficient scientific proof (STA.MARIA, supra at
653).
For sterility to constitute proof of non-paternity,
the husband must be shown to be completely
sterile at the time when the child was conceived
(STA. MARIA, supra at 654).
3. Vitiated Consent in artificial
insemination
NOTE: The mistake, fraud, violence,
intimidation or undue influence can be exerted
not only by the spouses against each other, but
also by third persons on both of the spouses or
on any one of them. In any case, only the
husband as provided in Art. 170 can impugn the
legitimacy of the child, or his heirs in special
cases provided in Art. 171.
PRESCRIPTIVE PERIODS TO IMPUGN
LEGITIMACY:
1. One year from knowledge of birth or recording in
the civil register, if husband or heirs live inthe
SAME city/municipality where the birth took
place or was recorded.
2. Two years, if both reside in the Philippines
3. Three years, if the child’s birth took place orwas
recorded in the Philippines while the husband
has his residence abroad (FAMILY CODE, Art.
170).
LEGITIMACY NOT SUBJECT TO
COLLATERAL ATTACK
Well-settled is the rule that the issue of legitimacy
cannot be attacked collaterally. The rationale for
these rules has been explained in this wise: “The
presumption of legitimacy in the Family Code
actually fixes a civil status for the child born in
wedlock, and that civil status cannot be attacked
collaterally. The legitimacy of the child can be
impugned only in a direct action brought for that
purpose, by the proper parties, and within the period
limited by law (Geronimo vs. Santos, G.R. No.
197099, September 28, 2015 see also Tison vs.
Court of Appeals, G.R. No. 121027, July 31, 1997).
PARTIES WHO CAN IMPUGN
LEGITIMACY OF A CHILD
GENERAL RULE: Only the husband may impugn.
Impugning the legitimacy of the child is a strictly
personal right of the husband. It is only in
exceptional cases that his heirs are allowed to
contest such legitimacy. Outside of these cases,
none—even his heirs—can impugn legitimacy; that
would amount to an insult to his memory (Liyao Jr.
v. Liyao, G.R. No. 138961, March 7, 2002).
EXCEPTION: The heirs may impugn within the
sameperiod in the following cases:
1. If the husband dies before the expiration of the
period fixed for bringing his action;
2. If he should die after the filing of the complaint
without having desisted therefrom; or
3. If the child was born after the husband’s death
(FAMILY CODE, Art. 171).
MOTHER HAS NO RIGHT TO DISAVOW
An assertion by the mother against the legitimacy
of her child cannot affect the legitimacy of the child
born or conceived within a valid marriage. A mother
has no right to disavow a child because maternity is
never uncertain (Concepcion v. CA, G.R. No.
123450, August 31, 2005).
DNA TESTING IN CASE OF DEATH OF
FATHER
The death of the putative father does not ipso facto
negate the application of DNA testing for as long as
appropriate biological samples of his DNA exist. In
such a case the petitioner must show the
impossibility of obtaining an appropriate biological
sample that can be utilized for the conduct of DNA
testing (Estate of Rogelio Ong v. Diaz, G.R. No.
171713, December 17, 2007).
STATUS OF CHILDREN BORN WITHIN
THREE HUNDRED (300) DAYS FROM
THE TERMINATION OF A FIRST
MARRIAGE AND THE CELEBRATION
OF A SUBSEQUENT MARRIAGE
Requisites: (TS–WBN)
1. First marriage was Terminated;
2. Mother contracted a Subsequent marriage;
3. Subsequent marriage was contracted Within
300 days after termination of previous marriage;
4. Child was Born within 300-day period;
5. No evidence as to status of child (FAMILY
 CODE, Arts. 168 and 169).
Illustration:
- Termination of first marriage: October 1, 2011
- Celebration of second marriage: January 1, 2012
- 300th day from termination of first marriage: July 26,
2012
- 180th day from celebration of second marriage:
June 28, 2012
Hence, a child born on or before June 28, 2012 is
presumed to be filiated to the first husband. A child
born at any time after June 28, 2012 (even if before
July 26, 2012) is presumed to be filiated with the
second husband.
No Presumption of Legitimacy After 300 days
The law does not give a status to a child born after
300 days following the termination of the marriage
(SEMPIO – DIY, supra at 283). The legitimacy or
illegitimacy of a child born 300 days following the
termination of the marriage shall be proved by
whoever alleges such legitimacy or illegitimacy
(FAMILY CODE, Art. 169).
NOTE: Art. 169 negates any presumption of filiation
for a child born after 300 days from the termination
of a marriage, in the absence of a subsequent
marriage (STA.MARIA, supra at 662).
PROOF OF FILIATION PROCEEDING
Is a special statutory proceeding to enforce a civil
obligation or duty specifically for the purpose of
establishing parentage and the putative father’s
duty to support his child (1 PARAS, supra at 684).
Filiation proceedings do not merely resolve the
matter of relationship with a parent but also secure
the legal rights associated with that relationship:
citizenship, support, and inheritance, among others.
An integrated determination of filiation is “entirely
appropriate” to the action for support filed by
petitioner Richelle for her child. An action for support
may very well resolve that ineluctable issue of
paternity if it involves the same parties, is brought
before a court with the proper jurisdiction, prays to
impel recognition of paternal relations, and invokes
judicial intervention to do so (Abella v. Cabañero,
G.R. No. 206647, August 9, 2017).
GENERAL RULE:
According to Art. 172 of the Family Code, filiation of
legitimate (or illegitimate) children is established by
any of the following: (RJA)
1. The Record of birth appearing in the civil
registry or a final Judgment; or
NOTE: In disregarding a birth certificate signed
by an attending physician as proof of filiation,
the Supreme Court said: Jurisprudence teaches
that a birth certificate, to be considered as
validating proofof paternity and as an instrument
ofrecognition, must be signed by the father and
mother jointly, or by the mother alone if the
father refuses (Angeles v. Maglaya, G.R. No.
153798, September 2, 2005).
NOTE: A final judgement however based on a
compromise agreement where the parties
stipulated and agreed on the status of a person
is void. Contractually agreeing and establishing
the civil status of a person is against the law and
public policy (STA. MARIA, supra at 673.)
2. An Admission of legitimate (or
illegitimate) filiation in a public
document or a private handwritten
instrument and signed by the parent
concerned.
Note: If it is a mere instrument, not in the
handwriting of the supposed parent or not a
public instrument it will not qualify under the law
(Id.).
EXCEPTIONS:
In the absence of any of the foregoingevidence, such
legitimate or illegitimate filiation shall be proved by:
(OA)
1. Open and continuous possession of the
status of a legitimate or illegitimate
child;
“Continuous” does not mean that the
possession of status shall continue forever, but
only that it shall not be of an intermittent
character while it is continuous. The
possession of such status means that the father
has treated the child as his own, directly and not
through others, spontaneously, and without
concealment, though without publicity. There
must be a showing of permanent intention of the
supposed father to consider the child as his own
by continuous and clear manifestation of
paternal affection and care (Mendoza v. CA,
G.R. No. 86302, September 24, 1991).
2. Any other means allowed by the Rules of
Court and special laws (FAMILY CODE,
Art. 172):
a. An act or declaration concerning pedigree
(RULES OF COURT, RULE 130, Sec. 33);
b. Family reputation or tradition concerning
pedigree (RULES OF COURT, RULE 130,
Sec. 40);
c. Common reputation respecting pedigree
 (RULES OF COURT, RULE 130, Sec. 41);
d. Judicial admission (RULES OF COURT,
RULE 129, Sec. 2);
e. Admission of a party (RULES OF COURT,
RULE 130, Sec. 22); and
f. Admission by silence (RULES OF COURT,
RULE 130, Sec. 32).
OTHER EVIDENCE OF FILIATION
Baptismal certificate, judicial admission, familybible,
evidence of pedigree, admission by silence,
testimonies of witnesses and other pieces of
evidence under Rule 130 of the Rules of Court may
be proofs of filiation (Salas v. Matusalem, G.R. No.
180284, September 11, 2013).
HANDWRITTEN AUTOBIOGRAPHY
In Dela Cruz v. Gracia (G.R. No. 177728, July 31,
2009), a handwritten autobiography of the father was
recognized as evidence of filiation although not
signed. The Court ruled that “where the private
handwritten instrument is accompanied by other
relevant and competent evidence, it suffices that the
claim of filiation therein be shown to have been
made and handwritten by the acknowledging parent
as it is merely corroborative of such other evidence.”
BAPTISMAL CERTIFICATE
However, in the subsequent case of Makati Shangri-
La & Resort, Inc. v. Harper, (G.R. No. 189998,
August 29, 2012), the Court held that, as a rule,
baptismal certificate, being hearsay, is not
conclusive proof of filiation.
While a baptismal certificate may be considered a
public document, it can only serve as evidence of the
administration of the sacrament on the datespecified
but not the veracity of the entries with respect to the
child’s paternity; and that baptismal certificates were
"per se inadmissible in evidence as proof of
filiation," and thus "cannot be admitted indirectly as
circumstantial evidence to prove filiation (Heirs of
Arado v. Alcoran, G.R. No. 163362, July 8, 2015).
A baptismal certificate is "no proof of the
declarations in the record with respect to the
parentage of the child baptized, or of prior and
distinct facts which require separate and concrete
evidence" (Heirs of Roldan v. Heirs of Roldan, G.R.
No. 202578, September 27, 2017).
SOCIAL SECURITY SYSTEM (SSS)
FORM
In Aguilar v. Siasat, G.R. No. 200169, January 28,
2015, petitioner’s SSS Form E-1 satisfies the
requirement for proof of filiation and relationship to
the Aguilar spouses under Art. 172 of the Family
Code; by itself, said document constitutes an
“admission of legitimate filiation in a public document
or a private handwritten instrument signed by the
parent concerned”.
NOTE: In the aforementioned case, petitioner has
shown that he cannot produce his Certificate ofLive
Birth since all the records covering the period 1945-
1946 of the LCR of Bacolod City were destroyed,
which necessitated the introduction of other
documentary evidence – particularly his SSS Form
E-1 – to prove filiation (Id.).
DNA TESTING TO PROVE PATERNITY
DNA evidence can be used to prove paternity for the
first time. In upholding the validity of the order
requiring DNA testing to prove paternity, the Court
provided that: it has long believed in the merits of
DNA testing and have repeatedly expressed as
much in the past. This case comes at a perfect time
when DNA testing has finally evolved into a
dependable and authoritative form of evidence
gathering. We therefore take this opportunity to
forcefully reiterate our stand that DNA testing is a
valid means of determining paternity (Agustin vs.
Court of Appeals, G.R. No. 162571, June 15, 2005).
ACTION TO CLAIM LEGITIMACY WHO
MAY CLAIM:
1. Child
– exclusive and personal right of childwhich
may be brought during his lifetime.
NOTE: If the proofs to be used by the illegitimate
child are those under the first paragraph of Art.
172, he or she has his or her whole lifetime to
bring the action to claim his or her illegitimate
status.
However, if the proofs used are those mentioned
in the second paragraph of Art. 172, the
illegitimate child may only bring the action during
the lifetime of his alleged parent (STA. MARIA,
supra at 692; see also Ara v. Pizarro,G.R. No.
187273, February 15, 2017).
ART 172(1) V. ART 172(2)
ART 172, PAR. 1 ART 172, PAR. 2
As to Proof
Record of birth1. Open and continuous
appearing in the civil possession of the
register or a final status of a legitimate
judgment; or an child; or
admission of legitimate2.
filiation in a public3. Any other means
document or a private allowed by the Rules of
handwritten instrument Court and special laws.

ART 172, PAR. 1 ART 172, PAR. 2
and signed by the parent
concerned.
As to Prescriptive Period
During the lifetime ofthe During the lifetime of
child. the child and the
putative parent.
2. Guardian
– if the child is a minor, or incapacitated, or
insane (SEMPIO-DIY, supra at 291).
3. Transmitted to heirs of the child within a
period of 5 years in case:
a. Child dies during minority;
b. Child dies in a state of insanity; and
c. Child dies after action has already been
instituted (FAMILY CODE, Art. 173).
ACTION TO CLAIM ILLEGITIMACY
Illegitimate children may establish their illegitimate
filiation in the same way and on the same evidence
as legitimate children (FAMILY CODE, Art. 175).
1. If illegitimate filiation is established by a record
of birth in the civil register or a final judgment,
or an admission of filiation in a public document
or a private handwritten instrument signed by
the parent concerned, the action for recognition
may be brought by the child during his lifetime
(Guy v. CA, G.R. No. 163707, September 15,
2006).
2. If the action is based upon open and continuous
possession of the status of an illegitimate child,
or any other means allowed by the rules or
special laws, it may be only brought during the
lifetime of the alleged parent(Id.).
Pure Act of Charity not Sufficient
The paternal affection and care must not be
attributed to pure charity. “Such acts must be of such
a nature that they reveal not only the conviction
of paternity, but also the apparent desire to have and
treat the child as such in all relations in society and
in life, not accidentally, but continuously” (Perla v.
Baring, G.R. No. 172471, November 12, 2012).
When record of birth is unsigned
Under the Family Code, filiation can be established
by, among others, the record of birth appearing in
the civil register, yet the rule is where the birth
certificate presented was not signed by the father
against whom filiation is asserted, such may not be
accepted as evidence of the alleged filiation. (People
vs. Delantar, G.R. No. 169143, February 2, 2007).
NOTE: Illegitimate child is under the sole parental
authority of the mother, who is entitled to keep the
child in her company. Recognition of the child by
the father could be a ground for ordering him togive
support to, but not to the custody of the child.
However, he is entitled to visitorial rights over the
child (Briones v. Miguel, G.R. No. 156343, October
18, 2004).
However, if the alleged father admits that the child
is his and lives with the child and the mother under
a void marriage or without the benefit of marriage,
both parents exercise parental authority (Dempsey
v. RTC, G.R. No. 77737, August 15, 1988).
ILLEGITIMATE CHILDREN MAY USE
THE SURNAME OF THEIR FATHER IF:
(EA)
1. Their filiation has been Expressly recognized by
the father through the record of birth appearing
in the civil register; or
2. When an Admission in a public document or
private handwritten instrument is made by the
father; provided, that the father has the right to
institute an action before the regular courts to
prove non-filiation during his lifetime (R.A. No.
9255, Sec. 1).
NOTE: An acknowledged illegitimate child is under
no compulsion to use the surname of his illegitimate
father. It is not the father or the mother who is
granted by law the right to dictate the surname of
their illegitimate children (Grande v. Antonio, G.R.
No. 206248, February 18, 2014).
LEGITIMATED CHILDREN
Children conceived and born outside of wedlock of
parents who, at the time of conception of the former,
were not disqualified by any impediment to marry
each other, or were so disqualified only because
either or both of them were below 18 years of age
and had subsequently married (FAMILY CODE, Art.
177 as amended).
LEGITIMATION
It is a remedy by means of which those who in fact
were conceived and born outside of wedlock and
should therefore be considered illegitimate are by
legal fiction considered legitimate. It shall take place
only by the subsequent valid marriagebetween the
biological parents (SEMPIO-DIY, supra at 284). It is
purely a statutory creation (STA.MARIA, supra at
696).
Requisites: (MIN)
1. There is a valid Marriage subsequent to the
child’s birth (FAMILY CODE, Art. 178);
2. The child is Illegitimate; and
3. The parents at the time of the child’s conception
 are Not disqualified by any impediment from
marrying each other or were so disqualified only
because either or both of them were below 18
years of age (FAMILY CODE, Art. 177, as
amended by R.A. 9858);
LEGITIMATION IS AUTOMATIC
Children born out of wedlock to parents who were
not allowed by law to marry for being minors are now
qualified for legitimation. This has been made
possible by R.A. No. 9858 (Legitimization ofChildren
Born to Minor Parents), approved on December 20,
2009 and has amended Art. 177 of the Family Code
of the Philippines. Before R.A. No. 9858, Art. 177
stated that only children born out of wedlock to
parents who were not disqualified from getting
married at the time of conception could be
legitimized. Under the present law, legitimation
would automatically take place upon marriage ofthe
parents. Moreover, couples who had children when
they were below the marrying age need not go
through the process of having to adopt their own
offspring just so their children could enjoy the rights
of legitimate children.
PERSONS ENTITLED TO QUESTION
LEGITIMATION
Generally, refer to those who would
suffer economic or material injury by legitimation
such astestamentary or intestate heirs (Id. at 700).
PRESCRIPTIVE PERIOD OF IMPUGNING
LEGITIMATION
Legitimation may be impugned within 5 years from
the time their cause of action accrues, that is, from
the death of the putative parent (FAMILY CODE, Art.
182).
GROUNDS FOR IMPUGNATION
Legitimation may be impugned on grounds like:
1. The subsequent marriage of the child’s parents
is void;
2. The child allegedly legitimated is not natural; or
3. The child is not really the child of the alleged
parents (SEMPIO – DIY, supra at 288).
ADOPTION
(RA 8552 AND RA 8043)
The process of making a child, whether related or
not to the adopter, possess in general, rights
accorded to a legitimate child (1 PARAS, supra at
711).
BEST INTEREST OF THE CHILD
Adoption statutes, being humane and salutary, hold
the interest and welfare of the child to be of
paramount consideration and are designed to
provide homes, parental care, and education for
unfortunate, needy, or orphaned children and give
them the protection of society and family in the
person of the adopter as well as to allow childless
couples to experience the joys of parenthood and
give them legally a child in the person of the adopted
for the manifestation of their natural parental
instincts. Every reasonable intendment should be
sustained to promote and fulfill these noble and
compassionate objectives of the law (In Re: Petition
for adoption of Michelle P. Lim, G.R. Nos. 168992,
May 21, 2009).
NATURE OF ADOPTION PROCEEDINGS
The prevailing laws on adoption are the Domestic
Adoption Act (R.A. 8552) and the Inter-Country
Adoption Act (R.A. No. 8043). Relevant also is the
Family Code, which repealed the substantive
provisions of P.D. No. 603 and E.O. No. 91 on
adoption (DE LEON & WILWAYCO, Special
Proceedings (Essential for the Bench and the Bar),
(2015), p. 286 [hereinafter DE LEON & WILWAYCO,
Special Proceedings]).
1. Adoption is a juridical act. Only an adoption
made through the court, or in pursuance of
Republic Act No. 8552 (RA 8552) is valid in this
jurisdiction.
Adoption is not of natural law at all, but is wholly
and entirely artificial. To establish the relation,
the statutory requirements must be strictly
carried out otherwise, the adoption is an
absolute nullity (Lazatin v. Campos, G.R. Nos.
L-43955-56, July 30, 1979). It cannot begranted
administratively.
2. Adoption proceedings are proceedings inrem,
and publication serves as constructive notice to
the whole world. Such publication is enough
where the residence of the parents is unknown
(Santos v. Aranzanso, G.R. No. L- 23828,
February 28, 1966).
DOMESTIC ADOPTION ACT OF 1998
(R.A. NO. 8552)
PRE–ADOPTION SERVICES (SEC. 4-6)
The DSWD shall provide for the following services
of licensed social workers to the following:
1. Counseling services for –
a. Biological parents (Sec. 4, par. a),
NOTE: No binding commitment for an adoption
 plan shall be permitted before the birth of his or
her child.
A period of 6 months shall be allowed for the
biological parent(s) to reconsider any decision to
relinquish his/her child for adoption before the
decision becomesirrevocable.
b. Prospective adoptive parents (Sec. 4, par.
b); and
c. Prospective adoptee (Sec. 4, par. c).
2. Exhaust all efforts to locate the
unknown biological parents.
NOTE: If efforts fail, child shall be listed as a
foundling and subsequently be the subject of
legal proceedings where he/she will be declared
abandoned (Sec. 5).
WHO MAY ADOPT:
1. Filipino citizen: (LPG-CONE)
a. Of Legal age;
b. In a Position to support and care for his/her
children in keeping with the means of the
family;
c. Good moral character;
d. In possession of full Civil capacity or legal
rights;
e. At least 16 years Older than the adoptee;
EXCEPTIONS: (BS)
i. Adopter is the Biological parent of the
adoptee; and
ii. Adopter is the Spouse of the adoptee’s
parent.
f. Has Not been convicted of any crime
involving moral turpitude; and
g. Emotionally and psychologically capable of
caring for children (Sec. 7, par. a).
2. Alien: (S-DELL)
a. Same qualifications as a Filipino Adopter;
b. Country has Diplomatic relations with the
Philippines;
c. His or her government allows the adoptee to
Enter his or her country as an adopted child;
d. Has been Living in the Philippines for at
least 3 continuous years prior to the
application for adoption and maintains such
residence until the adoption decree is
entered; and
Exception to (d): Temporary absences for
professional, business, health, or
emergency reasons not exceeding 60 days
in 1 year does not break the continuity
requirement (PROCEDURAL RULE ON
ADOPTION, A.M. No. 02-6-02-SC).
e. Certified to have Legal capacity to adopt by
his/her diplomatic or consular office but
certification may be waived in the same
instances for waiver of residency
requirement in (c) (R.A. 8552, Sec. 7, par.
b).
NOTE: Requirements of residency and
certificate of legal capacity may be waived if the
alien is:
a. A former Filipino citizen who seeks to adopt
a relative within the 4th degree of
consanguinity or affinity;
b. One who seeks to adopt the legitimate
son/daughter of his/her Filipino spouse; and
c. One who is married to a Filipino citizen and
seeks to adopt jointly with his/her spouse a
relative within the 4th degree of
consanguinity or affinity of the Filipino
spouse.
Foreign Adoptee does not Automatically
Acquire Citizenship
If a Filipino adopts an alien, the adopted alien
does not acquire Philippine citizenship because
such acquisition of citizenship acquires the
character of naturalization which is regulated,
not by the Civil Code or the Family Code, but by
special law (Ching Leng v. Galang, G.R. No.L-
11931, October 27, 1958).
3. Guardian: (TC)
a. After Termination of the guardianship, with
respect to the ward; and
b. Clearance of his/her financial
accountabilities (R.A. 8552, Sec. 7, par. c).
RULE ON ADOPTION BY SPOUSES
GENERAL RULE: The husband and the wife shall
jointly adopt (R.A. 8552, Sec. 7).
REASON: For the maintenance of harmony within
the family (STA.MARIA, supra at 721).
EXCEPTIONS: (LIS)
1. One spouse seeks to adopt the Legitimate child
of the other spouse;
2. One spouse seeks to adopt his/her own
Illegitimate child with the consent of the other
spouse; and
3. The spouses are legally Separated (Id.).
OTHER FACTORS TO BE CONSIDERED
IN EVALUATING PROSPECTIVE
PARENTS: (PEQ-F2M)
1. Total Personality of the applicants;
2. Emotional maturity;
3. Quality of marital relationship;
4. Feeling about children;
5. Feeling about childlessness and readiness to
adopt; and
6. Motivation (STA.MARIA, supra at 718).
WHO MAY BE ADOPTED: (B2-RILL)
1. Child whose Biological or adoptive parent(s)
have died, provided that no proceedings shall be
initiated within 6 months from the time of death
of said parent(s);
2. Any person Below 18 years of age or a person
under Sec. 2(2) and Sec. 2(5) of R.A. 9523;
3. Child whose adoption has been previously
Rescinded;
4. Illegitimate child of a qualified adopter to
improve the child’s status to that of legitimacy;
5. Legitimate child of the other spouse; and
6. A person of Legal age, who, prior to the
adoption, has been consistently considered by
the adopter as his/her own child since minority
(R.A. 8552, Sec. 8).
CONSENT IN ADOPTION (A-BiLIS)
The written consent of the following is required:
1. The Adoptee, if he is 10 years of age or over;
2. Known Biological parent(s) or legal guardians or
proper government instrumentality which has
legal custody of the child;
3. Legitimate/adopted children, 10 years old or
over, of the adopter(s) and adoptee;
4. The Illegitimate children, 10 years old or over,
of the adopter if living with the adopter and the
latter's spouse, if any; and
5. Spouse, if any, of the adopter and adoptee
(R.A. 8552, Sec. 9).
ADOPTER IN A POSITION TO SUPPORT
An alleged capability to support an adoptee through
the help of other persons is not enough to support a
petition for adoption. According to the Supreme
Court, adoption is personal between the adopter and
adoptee; the adopter should be in a position to
support the would-be adopted child in keeping with
the means of the family (Landingin v. Republic,G.R.
No 164948, June 27, 2006).
WRITTEN CONSENT OF BIOLOGICAL
PARENTS
Sec. 9 of R.A. 8552 provides that if the written
consent of the biological parents cannot be
obtained, the consent of the legal guardian must be
sought. To dispense with the requirement of written
consent, the abandonment must be shown to have
existed at the time of adoption and evinces a settled
purpose to forego all parental duties. The written
consent of the biological parents is indispensable for
the validity of a decree ofadoption. The natural right
of a parent to his child requires that consent be
obtained before parental rights and duties may be
terminated and re- established in adoptive parents
(Landingin v. Republic, G.R. No 164948, June 27,
2006).
A period of 6 months from the time the biological
parents made their decision shall be allowed for the
biological parent/s to reconsider any decision for
adoption subject to the paramount interest of the
child (STA. MARIA, supra at 725).
EFFECTIVITY OF DECREE OF
ADOPTION
A decree of adoption shall be effective as of the date
the original petition was filed. This applies also in
case the petitioner dies before the issuance ofthe
adoption decree, to protect the interest of the
adoptee (R.A. 8552, Sec. 13).
EXCEPTION TO RETROACTIVE EFFECT
In Tamargo v. CA, G.R. No. 85044, June 3, 1992,
where the petition for adoption was granted after
the child had shot and killed a girl, the SC did not
consider the retroactive effect of the decree of
adoption so as to impose a liability upon the adopting
parents accruing at the time when they had no actual
or physical custody over the adopted child. It held
that retroactive effect may be given where such is
essential to permit the accrual of some benefit or
advantage in favor of the adopted child. To hold that
parental authority had been retroactively lodged in
the adopting parents so as to burden them with
liability for a tortuous act that theycould neither have
foreseen nor prevented would be unfair and
unconscionable. To rule otherwise would be
contrary to the doctrine of vicarious liability.
MIDDLE NAME OF ADOPTED CHILD
The illegitimate child subsequently adopted by
his/her natural father is permitted to use as her
middle name the surname of her natural mother for
the following reasons:
1. It is necessary to preserve and maintain the
child’s filiation with her natural mother because
under Art. 189 of the Family Code, she remains
to be an intestate heir of the latter. To prevent
any confusion and needless hardship in the
future, her relationship or proof of that
relationship with her natural mother should be
maintained;
2. There is no law expressly prohibiting the
adopted to use the surname of her natural
mother as her middle name. What the law does
not prohibit, it allows; and
3. It is customary for every Filipino to have a middle
name, which is ordinarily the surname of the
mother (In the Matter of the Adoption of
Stephanie Nathy Astorga Garcia, G.R. No.
148311, March 31, 2005).
EFFECTS OF ADOPTION: (SAL)
1. Severance of legal ties between the biological
parents and the adoptee, which shall be vested
in the adopters;
EXCEPTION: If the biological parent is the
spouse of the adopter (R.A. 8552, Sec. 16).
NOTE: Biological parents of the covered person
qualify as the deceased’s dependent parent
and, thus, entitled to the death benefits under
the government’s Employees’ Compensation
Program (ECP). This ruling finds support on the
fact that even though parental authority is
severed by virtue of adoption, the ties between
the adoptee and the biological parents are not
entirely eliminated. To demonstrate, the
biological parents, in some instances, are able
to inherit from the adopted, as can be gleaned
from Art. 190 of the Family Code (Bartolome v.
SSS, G.R. No. 192531, November 12, 2014)
2. The Adoptee shall be considered as a
legitimate child of the adopter(s) for all intents
and purposes (Id. Sec. 17); and
3. In Legal or intestate succession, the adoptee
and the adopter(s) shall have reciprocal rights
of succession without distinction from legitimate
filiation. However, if there is a will, the rules on
testamentary succession shall be followed (Id.
Sec. 18).
Section 18 of RA 8552 provides that, in legal and
intestate succession, the rights of the adopter(s)
and the adoptee refer only to their “reciprocal
rights of succession without distinction from
legitimate filiation.” By using the term
“reciprocal,” the limitation is clear that the rights
only pertain to those existing and applicable
solely between them in their relationship as
parent and child. Thus, the adoptee is
considered a stranger as to the adopter’s
parents. The link is personal and limited to the
adoptee and adopter only.
It is a rule that successional rights of the adopted
and the adopter are purely statutory. Unless
provided by the adoption statute, the adopted
child does not inherit from the lineal or collateral
kindred of the adoptive parents (STA. MARIA,
supra at 738).
DECREE OF ADOPTION, NOT SUBJECT
TO COLLATERAL ATTACK
Once an adoption decree is issued, it cannot be
attacked collaterally as in the action for partition,
but in a direct proceeding frontally addressing the
issue (Sayson v. CA, G.R. Nos. 89224, January 23,
1992; see also Labagala v. Santiago, G.R. No.
132305, December 4, 2001).
RESCISSION OF ADOPTION
– decree of adoption may be rescinded by the
ADOPTEE only (R.A. 8552, Sec. 19).
GROUNDS: (PASA)
1. Repeated Physical or verbal maltreatment by
the adopter(s) despite having undergone
counseling;
2. Attempt on the life of the adoptee;
3. Sexual assault or violence;
4. Abandonment and failure to comply with
parental obligations (R.A. 8552, Sec. 19).
ADOPTER MAY ONLY DISINHERIT
ADOPTEE
Adoption shall not be subject to rescission by the
adopters. However, the adopters may disinherit the
adoptee for causes provided under Art 919 of the
Civil Code (R.A. 8552, Sec. 19).
An adoptee refused to use the surname of the
adopter though already adopted. The adopter
sought to rescind/ revoke the Decree of Adoption
(DOA), but the Domestic Adoption Act (R.A. 8552)
which removes the right of adopter to challenge the
validity of the DOA became effective. SC held that
the adopter may disinherit the adoptee, and that the
latter has the sole right to challenge the DOA
(Lahom v. Sibulo, G.R. No 143989, July 14, 2003).
DISINHERITANCE OF ADOPTEE BY
ADOPTER
GROUNDS: (GAMM-CARD)
1. Groundless accusation against the testator of a
crime punishable by 6 years or more of
imprisonment;
2. Found guilty of an Attempt against the life of
the testator, his/her spouse, descendants or
ascendants;
3. Causes the testator to Make or change a
testator’s will through fraud, violence,
intimidation, or undue influence;
4. Maltreatment of the testator by word or deed;
5. Conviction of a crime which carries the penalty
of civil interdiction;
6. Adultery or concubinage with testator’s spouse;
7. Refusal without justifiable cause to support the
parent or ascendant; and
8. Leads a Dishonorable or disgraceful life (CIVIL
CODE, Art. 919).
EFFECTS OF RESCISSION: (PaRAS)
1. Parental authority of adoptee’s biological
parent(s) or legal custody of DSWD shall be
restored if adoptee is still a minor or
incapacitated;
2. Reciprocal rights and obligations of the
adopter(s) and the adoptee to each other shall
be extinguished;
3. Amended certificate of birth of the adoptee shall
be cancelled and its original shall be restored;
and
4. Succession rights shall revert to their statusprior
to the adoption, but vested rights shall be
respected (R.A. 8552, Sec. 20).
ADOPTEE REMAINS AN HEIR OF THE
NATURAL PARENTS
Being a legitimate child only by virtue of adoption, it
follows that the child is entitled to all the rights
provided by law to a legitimate child. The adopted
child remains an intestate heir of his/her biological
parents. Hence, she can well assert her hereditary
rights from her natural mother in the future (In the
matter of adoption of Stephanie Nathy Astorga
Garcia, G.R. No. 148311, March 31, 2005).
SIMULATION OF BIRTH
It is the tampering of the civil registry making it
appear in the birth records that a certain child was
born to a person who is not his/her biological mother,
causing such child to lose his/her true identity and
status (R.A.8552, Art. 1, Sec. 3, par. j).
It is a crime defined and punished by Sec. 21 (b) of
R.A. 8552 committed by any person who shall cause
the fictitious registration of the birth of a child under
the names of persons who are not his/her biological
parents.
NOTE: Sec. 22 of R.A. 8552 on Rectification of
Simulated Births has been repealed by R.A. 11222
otherwise known as “An Act Allowing the
Rectification of Simulated Birth Records and
Prescribing Administrative Adoption Proceedings
for the Purpose” which has been signed into law on
February 21, 2019 and took effect on March 29,
2019.
SIMULATED BIRTH RECTIFICATION
ACT (R.A. 11222)
Grants amnesty and allows the rectification of the
simulated birth of a child where the simulation was
made for the best interest of the child, and that
such child has been consistently considered and
treated by the person or persons who simulated
such birth as her, his, or their own daughter or son
and exempts from criminal, civil, and administrative
liability those who simulated the birth record of a
child prior to the effectivity of the law (R.A. 11222,
Sec. 2).
Notwithstanding any provision of law to the contrary,
a person or persons who, prior to theeffectivity of
this Act, simulated the birth of a child, and those
who cooperated in the execution of such simulation,
shall not be criminally, civilly, or administratively
liable for such act: Provided, That the simulation of
birth was made for the best interest of the child and
that the child has been consistently considered and
treated by such personor persons as her, his, or their
own daughter orson: Provided, further, That such
person or persons has or have filed a petition for
adoption with an application for the rectification of
the simulated birthrecord within ten 10 years from
the effectivity of this Act: Provided, finally, That all
the benefits of this Act shall also apply to adult
adoptees (R.A. 11222, Sec.4).
EXEMPTION FROM CRIMINAL, CIVIL
AND ADMINISTRATIVE LIABILITY
A person or persons who, prior to the effectivity of
R.A. 11222, simulated the birth of a child, and those
who cooperated in the execution of such simulation,
shall not be criminally, civilly, or administratively
liable for such act provided that:
1. That the simulation of birth was made for the
best interest of the child and that the child has
been consistently considered and treated by
such person or persons as her, his, or their own
daughter or son;
2. That such person or persons has or have filed
a petition for adoption with an application for
the rectification of the simulated birth record
within ten (10) years from the effectivity of this
Act; and
3. That all the benefits of this Act shall also apply
to adult adoptees (R.A. 11222 Sec. 4).
INTER-COUNTRY ADOPTION ACT OF
1995 (R.A. 8043)
The socio-legal process of adopting a Filipino child
by a foreigner or a Filipino citizen permanently
residing abroad where the petition is filed, the
supervised trial custody is undertaken, and the
decree of adoption is issued outside the Philippines
(R.A. 8043, Sec. 3, par. a).
Who May Be Adopted
Only a “legally-free child” may be the subject of inter-
country adoption (R.A. 8043, Sec. 8).
A child for the purpose of the act is any person below
fifteen years of age or unless sooner emancipated
by law (R.A. 8043, Sec. 3 par. b).
Child Legally Available for Adoption
A child in whose favor a certification was issued by
the DSWD that he/she is legally available for
adoption after the fact of abandonment or neglect
has been proven through the submission of pertinent
documents, or one who was voluntarily committed
by his/her parent(s) or legal guardian (Sec 2 (5)
R.A. 9523).
There shall be no physical transfer of a voluntarily
committed child earlier than 6 months from the date
of execution of Deed of Voluntary Commitment
except:
1. Adoption by a relative; and
2. Children with special medical conditions (R.A.
8043, Sec. 26).
Deed of Voluntary Commitment
A deed signed by the parents with DSWD that a child
is being voluntarily submitted for adoption (R.A.
8043, Sec. 3, par. s).
Who may adopt:
1. Any alien; or
2. Filipino citizen, both permanently residing
abroad (R.A. 8043, Sec. 27).
Conditions: (JAC-NERD-PQ)
1. If married, his/her spouse must Jointly file for the
adoption;
2. At least 27 years of Age and at least 16 years
older than the child to be adopted, at the time
of the application unless the adopter is:
a. Parent by nature of the child to be adopted;
or Spouse of such parent
3. Capacity to act and assume all rights and
responsibilities incidental to parental authority
under his/her national laws, and has undergone
the appropriate counseling from an accredited
counselor in his/her country;
4. Has Not been convicted of a crime involving
moral turpitude;
5. Eligible to adopt under his/her national law;
6. Agrees to uphold the basic Rights of the child
as embodied under Philippine laws, the U.N.
Convention on the Rights of a Child, and to
abide by the rules and regulations issued to
implement the Inter–Country Adoption Act;
7. Comes from a country with whom the
Philippines has Diplomatic relations and whose
government maintains a similarly authorized
and accredited agency and that adoption is
allowed under his/her national laws;
8. In a Position to provide the proper care and
support and to give the necessary moral values
and examples to all his children, including the
child to be adopted; and
9. Possesses all the Qualifications and none of the
disqualifications under the Inter–Country
Adoption Act and other applicable Philippine
laws (Implementing Rules of R.A. No. 8043, as
amended).
Filing of Application
Either with the Philippine RTC having jurisdiction
over the child OR with the Inter-Country Adoption
Board, through an intermediate agency (R.A. 8043,
Sec. 10).
Inter-Country Adoption Board
It acts as the central authority in matters relating to
inter-country adoption (Sec. 3, par. h).
The Board shall ensure that all possibilities for the
adoption of the child under the Family Code have
been exhausted and that inter–country adoption is in
the best interest of the child.
Family Selection and Matching
The matching of the child with an applicant shall be
carried out during a matching conference by the
committee together with the head or social worker
of the agency or the Secretariat social worker of the
inter-country adoption board. The Board shall set the
guidelines for the manner by which the matching
process shall be conducted (R.A. 8043, Sec. 11).
Supervision of Trial Custody
The foreign governmental or an accredited agency
shall be responsible for the pre-adoptive placement,
care and family counseling of the child for at least 6
months from his/her arrival in the residence of the
applicant/s, when applicable. During the pre-
adoptive placement, the foreign authority/agency
shall furnish the Board with quarterly reports on the
child’s health, psycho-social adjustment, and
relationship with the applicant/s. The report shall
also include updated information regarding the
applicants’ personal circumstances, if any (Sec. 44).
1. Starts upon actual physical transfer of the child
to the applicant who, as actual custodian, shall
exercise substitute parental authority over the
person of the child (Implementing Rules of R.A.
8043, Sec. 42);
2. The adopting parent(s) shall submit to the
governmental agency or authorized and
accredited agency, which shall in turn transmita
copy to the Board, a progress report of the
child’s adjustment.
Remedy in case of Disruption and Termination of
Placement:
In the event of serious damage in the relationship
between the child and applicant; or when the
continued placement is no longer in the best
interests of the child:
1. The Board through the Central Authority shall
take necessary measures to protect the child,
in particular cause the child to be withdrawn
from the applicant and arrange for his
temporary care;
2. The Central Authority shall exhaust all means
to remove cause of unsatisfactory relationship;
3. The Central Authority shall submit a complete
report to the Board as to the actions taken as
well as recommendations; and
4. Based on the report submitted by the Central
 Authority, the Board may terminate the pre- DOMESTIC ADOPTION V.
adoptive relationship (Implementing Rules of INTERCOUNTRY ADOPTION
R.A. 8043, Sec. 47).
DOMESTIC ADOPTION INTERCOUNTRY
NOTE: If a satisfactory pre-adoptive relationship is (R.A. 8552) ADOPTION(R.A.
formed between the applicant and the child, the 8043)
Board shall transmit an Affidavit of Consent to the
Adoption executed by the Department to theCentral As to Type of Proceeding
Authority and/or the Foreign Adoption Agency (FAA) Judicial Adoption Extrajudicial Adoption
within 15 days after receipt of the last post
placement report (Implementing Rules of R.A. 8043, As to Where to File
Sec. 50).
Family Court of the place Family Court where the
A copy of the final decree of adoption, including the where adopter(s) adoptee resides or
Certificate of Citizenship/Naturalization, whenever reside(s). may be found, or
applicable, shall be transmitted by the Central Intercountry Adoption
Authority and/or the FAA to the Board within 1month Board, through an
after its issuance. The Board shall require the intermediate agency,
recording of the final judgment in the appropriate whether governmental
Philippine Civil Registry (Implementing Rules of R.A. or an authorized
8043, Sec. 52). and accredited
agency, in the country
In the event of termination of the pre-adoptive of the prospective
relationship, the Board shall identify from the Roster adoptive parents (Sec.
of Approved Applicants a suitable family with whom 30 and 51).
to place the child. The Central Authority and/or the
FAA may also propose a replacement family whose As to Who May Adopt
application shall be filed for the approval of the
Board. No adoption shall take place until after the 1. Any Filipino citizen; Foreign nationals and
Board has approved the application of such 2. Any alien Filipino citizens
replacement family (Implementing Rules of R.A. possessing the permanently residing
8043, Sec. 48). same qualifications abroad.
forFilipino nationals,
Presumption of Illegal adoption: (CPEN) (see discussion
1. Consent for adoption was acquired through or regarding
attended by coercion, fraud, improper material qualifications); and
inducement; 3. The guardian with
2. Procedures and safeguards provided by law for respect to the ward
adoption were not complied with; after the termination
3. Has Exposed or subjected the child to be of the guardianship
adopted to danger, abuse or exploitation; and and clearance of
4. No authority to effect adoption from the Board this financial
(Implementing Rules of R.A. 8043, Sec. 57). accountabilities.

As to Who May Be Adopted

1. Any person below 18 Only a legally free child

years of age who may be legally adopted
has been voluntarily under the inter-country
committed; adoption act (Sec 8).
2. The legitimate
son/daughter of one Child Legally Available
spouse by the other for Adoption refers to a
spouse; child in whose favor a
3. An illegitimate certification was issued
son/daughter by a by the DSWD that
qualified adopter to he/she is legally
improve his/her available for adoption
status to that of after the fact of
legitimacy; abandonment or
4. A person of legal neglect has been KINDS: (LJC)
age regardless of proven through the 1. Legal
civil status if, prior to submission of pertinent – one required or given by law;
adoption, said documents, or one who
person has been was voluntarily 2. Judicial
consistently committed by his/her – required by the court to be given whether
considered and parent(s) or legal pendente lite or in a final judgment; and
treated by the guardian (Sec 2 (5)
adopter(s) as his/her R.A. 9523). 3. Conventional
own child since – given by agreement.
minority;
5. A child whose CHARACTERISTICS: (MR-P2INE)
adoption has been 1. Mandatory;
previously 2. Reciprocal on the part of those who are by law
rescinded; or bound to support each other;
6. A child whose 3. Personal;
biological or 4. Provisional character of support judgment;
adoptive parent(s) 5. Intransmissible;
has died: provided 6. Not subject to waiver or compensation; and
that no proceedings 7. Exempt from attachment or execution
shall be initiated (1TOLENTINO, supra at 575).
within 6 months from
time of death of said PERSONS OBLIGED TO SUPPORT
parents (Sec. 8)
7. A Child not
EACH OTHER: (SP²L²)
otherwise 1. Spouses;
disqualified by law or a. The duty to support and the right to be
the rules. supported presuppose a valid marriage
between the parties. However, it has been
As to Supervised Trial Custody held that the adultery of the wife is a valid
defense against an action for support
At least six months, but At least six months. initiated by the wife claiming support
the court may reduce the (Quintana v. Lerma, G.R. No. 7426,
period or exempt parties Within the country of February 5, 1913).
from trial custody (Sec. theadopter.
12). NOTE: It is suggested that while adultery
may be a defense in an action for personal
Within the Philippines. support, that is, support of the wife by the
husband from his own funds, it is not a
As to Issuance of Decree of Adoption defense when the support is to be taken
from the conjugal partnership property
By the Family Court in By the Accredited
(Lerma v. CA, G.R. No. L-33352, Dec. 20,
the Philippines Agency Abroad
1974).
(DELEON & WILWAYCO, supra at 286).
b. Also, a spouse who leaves the conjugal
home or refuses to live therein, without just
cause, shall not have the right to be
SUPPORT supported from the conjugal properties or
the absolute community of properties
(ARTS. 194-208) (FAMILY CODE, Arts. 100 and 127).

2. Parents and their legitimate children, and the

legitimate and illegitimate children of the latter;
SUPPORT:(SDC-MEDET)
It comprises everything indispensable for 3. Parents and their illegitimate children, and the
Sustenance, Dwelling, Clothing, Medical legitimate and illegitimate children of the latter;
attendance, Education and Transportation in
keeping with the financial capacity of the family 4. Legitimate ascendants and descendants; and
(FAMILY CODE, Art. 194).
5. Legitimate brothers and sisters whether full or
 half-blood provided, brothers and sisters not
legitimately related whether full or half-bloodare
likewise entitled to support to the full extent
under Art. 194 except when the need for support
of the brother or sister, being of age, is due to a
cause imputable to claimant’s fault or
negligence (FAMILY CODE, Arts. 195-196).
NOTE: Art. 197 providing for the source from where
the support should be taken out highlight the fact that
the people enumerated in Art. 195 have a personal
obligation to support each other (STA. MARIA, supra
at 798).
OBLIGATION TO SUPPORT A CHILD IS
A MATTER OF PUBLIC POLICY
As a rule, the obligation to give support is governed
by the national law the person obliged to give
support. In Del Socorro v. Van Wilsem, the Supreme
Court held that “The obligation to give support to a
child is a matter that falls under family rights and
duties. Since the respondent is a citizen of Holland
or the Netherlands, he is subject to the laws of his
country, not to Philippine law, as to whether he is
obliged to give support to his child, as well as the
consequences of his failure to do so.” However,
since the law of the Netherlands as regards the
obligation to support has not been properly pleaded
and proved in the instant case, itis presumed to be
the same with Philippine law, which enforces the
obligation of parents to support their children and
penalizing the non-compliance therewith.
Additionally, when the foreign law, judgment or
contract is contrary to a sound and established
public policy of the forum, the said foreign law,
judgment or order shall not be applied. Thus, even if
the laws of the Netherlands neither enforce a
parent’s obligation to support his child nor penalize
the noncompliance therewith, suchobligation is still
duly enforceable in the Philippines because it would
be of great injustice to the child to be denied of
financial support when the latter is entitled thereto
(G.R. No. 193707, December 10, 2014).
For support of legitimate ascendants, descendants
(legitimate/illegitimate), brothers, and sisters
(legitimate/illegitimate), only separate property of the
person obliged to give support shall be answerable.
In the absence of separate property, the CPG or
ACP shall advance the support deductible from the
share of spouse obliged upon liquidation (FAMILY
CODE, Art. 197).
In case of legitimate descendants (common children
of the spouse or the legitimate children of either
spouse), the ACP or CPG shall be principally
charged for their support as mandated by law in
Arts. 94, par. 1 and 121, par. 1. This is different from
personal support owing to them from the father or
mother as provided in Arts. 195 and 197.
Recognition by the Alleged Father Required
Before a child may be entitled to support, he must
be recognized by the alleged father (Perla v.
Baring, G.R. No. 172471, November 12, 2012).
ORDER OF LIABILITY IF SEVERAL
PERSONS ARE OBLIGED TO GIVE
SUPPORT: (SDAB)
1. Spouse;
2. Descendants in the nearest degree;
3. Ascendants in the nearest degree; and
4. Brothers and sisters (FAMILY CODE, Art. 199).
If the obligation to give support falls upon two or
more persons, payment shall be divided between
them in proportion to their resources. In case of
urgent need and special circumstances, the court
may order only one of them to furnish support
provisionally subject to the right to claim from the
others the share due them (FAMILY CODE, Art. 200,
par. 1-2).
INSUFFICIENCY OF MEANS TO GIVE
SUPPORT
When two or more recipients at the same time claim
for support and the person legally obliged to give
does not have sufficient means to satisfy all claims:
1. The order of liability provided by law shall be
followed; and
2. If the concurrent obligees should be the spouse
and a child subject to parental authority, the
child shall be preferred (FAMILY CODE, Art.
200).
In Mangonon v. CA, G.R. No. 125041, June 30,
2006, the Supreme Court ordered the grandfather,
who was proven to be well-off to support his
grandchildren on the basis of Art. 199, considering
that their parents were not capable of supporting
the children.
SUPPORT BY A STRANGER SHALL BE
REIMBURSABLE UNDER ART. 206 IF:
(IN)
1. Stranger gives support to another person with
the Intention to be reimbursed; and
2. Person obliged to give support to the recipient
does Not have knowledge of the stranger’s act
UNDER ART. 207 IF: (UFU)
1. There is an Urgent need to be supported on the
part of the recipient;
2. A third person Furnishes the support to the
needy individual; and
3. The person obliged to support Unjustly refuses
or fails to give the support.
APPLICATION OF THE PRINCIPLE OF
UNJUST ENRICHMENT
In Lacson v. Lacson, G.R. No. 150644, August 28,
2006, the Supreme Court ruled that the sisters
would, through their mother, turn to their uncle Noel
Daban for their sustenance and education when
petitioner (their father) failed to give the same, a
failing which stretched from their pre-schooling days
to their college years. Since such failure has been
established, it is not amiss to deduce, that Noel
Daban who, owing to consideration of kinship, had
reasons to help, indeed lent his sister Lea money to
support her children. Mention may alsobe made
that, contextually, the resulting juridical relationship
between the petitioner and Noel Daban is a quasi-
contract, an equitable principle enjoining one from
unjustly enriching himself at the expense of another.
AMOUNT OF SUPPORT
It shall be in proportion to the resources or means
of the giver and to the necessities of the recipient
(FAMILY CODE, Art. 201; Lam v. Chua, G.R.
No.131286, March 18, 2004). It shall be increased or
reduced proportionately, according to the increase
or reduction of necessities of the recipient and the
resources or means of the person obliged (FAMILY
CODE, Art. 202).
The law on support is rooted on the fact that the right
and duty to support, especially the right to education,
subsists even beyond the age of majority (Estate of
Hilario M. Ruiz v. CA, G.R. No. 118671, January 29,
1996).
DEMAND FOR SUPPORT (ART. 203)
The obligation to give support shall be demandable
from the time the person who has a right to receive
the same needs it for maintenance, but it shall not
be paid except from the date of judicial or
extrajudicial demand (Sy v. CA, G.R. No. 124518,
December 17, 2007).
PAYMENT OF SUPPORT STARTS FROM
THE TIME WHEN DEMAND WAS MADE
Payment of the amount for support starts only from
the time support has been judicially or extra-
judicially demanded for the right to support does not
arise from the mere fact of relationship, but from
imperative necessity without which it cannot be
demanded, and the law presumes that such
necessity does not exist, unless support is
demanded (Jocson v. Empire Insurance Co., G.R.
No. L-10792, April 30, 1958).
PERFORMANCE OF OBLIGATION TO
SUPPORT (PM)
The person obliged to give support shall have the
following options:
1. Pay the allowance fixed; or
2. Receive and Maintain in the family dwelling the
person who has a right to receive support
provided that there is no moral or legal obstacle
to do so (FAMILY CODE, Art. 204).
NOTE: The latter alternative cannot be availed
of in case there is a moral or legal obstacle
thereto, such as the strained relationship
between the parties (Mangonon v. CA, supra).
SUPPORT EXEMPTED FROM
ATTACHMENT AND EXECUTION
The right to receive support as well as money or
property obtained as such support shall not be levied
upon on attachment or execution (FAMILY CODE,
Art. 205). But in case of contractual support or that
given by will, the excess in amount beyond that
required for legal support shall be subject to levy on
attachment or execution (FAMILY CODE, Art. 208).
Only salary "due" the judgment debtor is subject to
attachment and execution, and then only if it is not
made to appear by the affidavit of the debtor or
otherwise that such earnings are necessary for the
support of his family. Under the Rules of Court, so
much of the earnings of the debtor for his personal
services within the month preceding the levy as are
necessary for the support of his family (RULE 39,
Sec. 122) is exempt from execution (Avendaño v.
Alikapala, G.R. No. L-21189, November 28, 1964).
CONTRACTUAL SUPPORT VIS-À-VIS
LEGAL SUPPORT
Contractual support is one entered into by the
parties usually with reciprocal duties andobligations
and is not mandated by law. However, legal support
is that which is mandated by law to begiven and that
which is provided in Art. 194 (STA.MARIA, supra
at 826).
WHEN OBLIGATION TO SUPPORT
CEASES
The obligation to furnish support ceases upon the
death of the obligor, even if he may be bound to give
it in compliance with a final judgement. The
obligation to give support shall also cease: (DREM)
1. Upon the Death of the recipient;
2. When the resources of the obligor have been
Reduced to the point where he cannot give the
support without neglecting his own needs and
those of his family;
3. When the recipient may Engage in a trade,
profession, or industry, or has obtained work, or
 has improved his fortune in such a way that he
no longer needs the allowance for his
subsistence;
4. Upon annulment of the Marriage.
Procedures in Application for Support
The Family Courts shall have exclusive original
jurisdiction to hear and decide Petitions for support
and/or acknowledgment (R.A. No.8369, Sec. 5 (e)).
In cases of violence among immediate family
members living in the same domicile or household,
the Family Court may issue a restraining order
against the accused or defendant upon verified
application by the complainant or the victim for relief
from abuse. The court may order the temporary
custody of children in all civil actions for their
custody. The court may also order support pendente
lite, including deduction from the salary and use of
conjugal home and other properties in all civil
actions for support (R.A. No.8369, Sec. 7).
SUPPORT PENDENTE LITE
During the proceedings for legal separation or for
annulment of marriage, and for declaration of nullity
of marriage, the spouses and their children shall be
supported from the properties of the absolute
community or the conjugal partnership.
Mutual support between the spouses ceases after
final judgment.
In case of legal separation, the court may order the
guilty spouse to support the innocent spouse
(FAMILY CODE, Art. 198 in relation to Rule 61 of the
Rules of Court).
In determining the amount to be awarded as support
pendente lite, it is not necessary to go fully into the
merits of the case, it being sufficient thatthe court
ascertain the kind and amount of evidence it may
deem sufficient to enable it to justly resolve the
application, one way or the other, in view of the
merely provisional character of the resolution to be
entered. Mere affidavits may satisfy the court to
pass upon the application for support pendente
lite. It is enough that the facts be established by
affidavits or other documentary evidence appearing
in the record (Reyes v. Ines- Luciano, G.R. No. L-
48219, February 28, 1979).
PARENTAL AUTHORITY
(ARTS. 209-233)
PARENTAL AUTHORITY (PATRIA
POTESTAS)
It is the sum total of the right of the parents over the
persons and property of their unemancipated
children. It is pursuant to the natural right and duty
of parents over the same and it includes caring for
and rearing of such children for civic consciousness
and efficiency and the development of their moral
and physical character and well-being (FAMILY
CODE, Art. 209).
CHARACTERISTICS OF PARENTAL
AUTHORITY: (NARD- RTW- JPT)
1. A Natural Right and Duty of the parents
(FAMILY CODE, Art. 209);
2. It cannot be Renounced, Transferred, or
Waived except in the cases authorized by law
(FAMILY CODE, Art. 210).
3. It is Jointly exercised by the father and mother
(FAMILY CODE, Art. 211, par. 1);
4. It is Purely personal and cannot be exercised
through agents.; and
5. It is Temporary and will end when the child is
emancipated or can otherwise take care of
himself and his property, or the parent is unable
to properly exercise the authority (SEMPIO-
DIY, supra at 351).
PARENTAL PREFERENCE RULE
The natural parents, who are of good moral
character and who can reasonably provide for the
child, are ordinarily entitled to custody as against all
other persons (STA.MARIA, supra at 838).
MATERNAL PREFERENCE RULE
The law favors the mother if she is a fit and proper
person to have custody of her children so that they
may not only receive her attention, care,supervision
and kindly advice, but also may have the advantage
and benefit of a mother’s love and devotion for which
there is no substitute (STA. MARIA, supra at 839,
citing Cooke v. Cooke, 70 ALR 3d 255).
The general rule that children under seven years of
age shall not be separated from their mother finds its
raison d’être in the basic need of minor children for
their mother’s loving care (Pablo-Gualberto vs.
Gualberto, G.R. No. 154994, June 28, 2005).
EXEMPTION TO MATERNAL
PREFERENCE RULE
Maternal preference is not an absolute rule. It is
intended to service only the function of a tie- breaker
in those rare instances when parental qualities are
so equally balanced between litigants that resort to
preference is necessary (STA. MARIA, supra at
844). The Court may decide to separate the mother
from the child in exceptional cases where there are
compelling reasons to do so under Art. 213.
PARENTAL AUTHORITY IS PURELY
PERSONAL
Parental authority and responsibility are inalienable
and may not be transferred or renounced except in
cases authorized by law. The right attached to
parental authority, being purely personal, the law
allows a waiver of parental authority only in cases
of adoption, guardianship and surrender to a
children’s home or an orphan institution. When a
parent entrusts the custody of a minor to another,
such as a friend or godfather, even in a document,
what is given is merely temporary custody and it
does not constitute a renunciation of parental
authority. Even if a definite renunciation is manifest,
the law still disallows the same. The father and
mother, being the natural guardians of
unemancipated children, are duty-bound and
entitled to keep them in their custody and company
(Sagala-Eslao v. CA, G.R. No. 116773, January 16,
1997).
The right of custody accorded to parents springfrom
the exercise of parental authority (Santos v. CA,
G.R. No. 113054, March 16, 1995).
RULES ON THE EXERCISE OF
PARENTAL AUTHORITY
Joint parental authority by the father and mother
over the persons of their common children, whether
legitimate or illegitimate. In case of disagreement,
the father’s decision shall prevail unless there is a
judicial order to the contrary (FAMILY CODE, Art.
211, par. 1).
Under Art. 176, parental authority of illegitimate
children is generally with the mother. To harmonize
Art. 176 with Art. 211, joint parental authority may be
exercised over illegitimate children if:
1. The father is certain; and
2. The illegitimate children are living with the said
father and mother who are cohabiting without
the benefit of marriage or under a void marriage
not falling under Arts. 36 and 53 (STA.MARIA,
supra at 830-831).
NOTE: The recognition by the father could be a
ground for ordering him to give support, but not
custody of the child. Only if the mother defaults can
the father assume such custody or authority. Only
the most compelling of reasons, such as the
mother’s unfitness to exercise sole parental
authority shall justify deprivation of her parental
authority and the award of custody to someone else
(Briones v. Miguel, G.R. No. 156343, October 18,
2004).
RIGHTS OF PARENTS WITH PARENTAL
AUTHORITY
The parents may exercise the following rights over
the person and properties of their children: (C2OIL-
U)
1. The right to have them in their company
(Custody);
2. The right to withhold or give Consent in certain
matters;
3. The right to be Obeyed and respected;
4. The right to Impose discipline on them as may
be required under the circumstances;
5. The right to exercise Legal guardianship over
the property of unemancipated common
children; and
6. The limited right of Usufruct over the child’s
property (RABUYA, supra at 656).
Duties of Children towards their Parents: (RO)
1. To observe Respect and reverence toward their
parents; and
2. To Obey their parents as long as they are
under their parental authority.
RULE OF FILIAL PRIVILEGE
GENERAL RULE: No descendant shall be
compelled, in a criminal case, to testify against his
parents and grandparents.
EXCEPTION: When such testimony is
indispensable in a crime against the descendant or
by one parent against the other (FAMILY CODE, Art.
215, in relation to Sec. 25, RULE 130 of the Rules
on Evidence).
FILIAL PRIVILEGE APPLIES ONLY TO
DIRECT ASCENDANTS AND
DESCENDANTS
In Lee v. CA, G.R. No. 177861, July 13, 2010, the
person (Tiu) who invoked the filial privilege claims
that she is the stepmother of petitioner Lee. The
privilege cannot be applied because the rule applies
only to “direct” ascendants and descendants, a
family tie connected by a common ancestry. A
stepdaughter does not have common ancestry to her
stepmother. Relative thereto, Art. 965 of the Civil
Code provides that the direct line is either
descending or ascending. The former unites the
head of the family with those who descend fromhim.
The latter binds a person with those from whom he
descends. Consequently, Tiu can be compelled to
testify against petitioner Emma Lee.
CAUSE OF EFFECT ON PARENTAL
ABSENCE OF AUTHORITY
This rule is not strictly a rule on disqualification
PARENTS
because a descendant is not incompetent or
disqualified to testify against an ascendant. Therule Legal PA shall be exercised by the
refers to a privilege not to testify, which can be separation of parent designated by the court.
invoked or waived like other privileges. As correctly parents.
observed by the lower court, Elven was not EXCEPTION:
compelled to testify against his father; he chose to If the child is under seven years
waive that filial privilege when he voluntarily testified old, the mother shall have
against Artemio. Elven declared that he was custody over said child.
testifying as a witness against his father of his own
accord and only "to tell the truth” (People v. EXCEPTION TO THE
Invencion, G.R. No. 131636, March 5, 2003). EXCEPTION:
Unless the court finds
MARITAL PRIVILEGE compelling reasons to order
In line with the filial privilege under Art. 215 of the otherwise.
Family Code is the marital privilege provided for
under the Rules of Court which states that: Death, Substitute parental authority
absence or shall be exercised by the
The husband or the wife, during or after the unsuitability of surviving grandparent. In case
marriage, cannot be examined without the consent both parents. several survive, the one
of the other as to any communication received in designated by the court shall
confidence by one from the other during the exercise such, taking into
marriage except in a civil case by one against the account the best interest of the
other, or in a criminal case for a crime committed child.
by one against the other or the latter's direct
descendants or ascendants (RULES OF COURT,
Sec. 24(a)).
DOCTRINES REGARDING THE
RULES IN CASE PARENTAL MATERNAL PREFERENCE GRANTED
AUTHORITY CANNOT BE EXERCISED BY ART. 213, PAR. 2.
JOINTLY 1. Maternal preference cannot be subjected
CAUSE OF EFFECT ON PARENTAL to an agreement between the separated
ABSENCE OF AUTHORITY spouses
PARENTS
The separated parents cannot contract away the
Absence or PA continued by the present provision in the Family Code on the maternal
death of either parent or survivingparent. custody of children below 7 years any more than
parent. they can privately agree that a mother who is
unemployed, immoral, habitually drunk, a drug
In case of PA continued to beexercised by addict, insane, or afflicted with a communicable
remarriage of surviving parent unless the court disease will have sole custody of a child under
the surviving appoints another person as seven as these are reasons deemed compelling
parent. guardian to preclude the application of the exclusive
maternal custody regime under the second
NOTE: The new spouse, by paragraph of Art. 213.
virtue of his or her marrying the
surviving parent, does not Any agreement of the parties unduly depriving
automatically possess parental the mother of custody of their children under 7
authority over the children of the years of age in the absence of compelling
surviving parent unless such reasons determined by courts is null and void.
new spouse adopts the children (STA.MARIA, supra at 841).
(STA.MARIA, supra at 833).
2. As to the bias favoring the mother over
the father in case of separation
At any rate, the rule’s seeming harshness or
undesirability is tempered by ancillary
agreements the separated parents may wish to
 enter, such as granting the father visitation and
other privileges. These arrangements are not
inconsistent with the regime of sole maternal
custody under the second paragraph of Art. 213
which merely grants to the mother final
authority on the care and custody of the minor
under 7 years of age, in case of disagreements
(Dacasin v. Dacasin, G.R. No. 168785, February
5, 2010).
3. As to the limited period of application of
preference
Further, the imposed custodial regime underthe
second paragraph of Art. 213 is limited in
duration, lasting only until the child’s 7th year.
From the 8th year until the child’s emancipation,
the law gives the separated parents freedom,
subject to the usual contractual limitations, to
agree on custody regimes they see fit to adopt
(Dacasin v. Dacasin, G.R. No. 168785, February
5, 2010).
WRIT OF HABEAS CORPUS IN CHILD
CUSTODY CASES
Habeas corpus may be resorted in cases where
rightful custody is withheld from a person entitled
thereto (Salientes v. Abanilla, G.R. No. 162734,
August 29, 2006).
CONSIDERATION IN CHILD CUSTODY
CASES
The controversy does not involve the question of
personal freedom, because an infant is presumedto
be in the custody of someone until he attains
majority age. In passing on the writ in a child custody
case, the court deals with a matter of an equitable
nature. Hence, the court is not bound to deliver a
child into the custody of any claimant or of any
person, but should, in the consideration of the facts,
leave it in such custody as its welfare at the time
appears to require. In short, the child’s welfare is the
supreme consideration (Sombong v. CA, G.R. No.
111876, January 31, 1996).
MATERNAL PREFERENCE/TENDER
YEARS RULE
GENERAL RULE: No child under 7 years of age
shall be separated from the mother.
EXCEPTION: When the court finds compelling
reason to order otherwise. The welfare and well-
being of the child is the paramount consideration in
awarding custody (FAMILY CODE, Art. 213).
SUBSTITUTE PARENTAL AUTHORITY
Persons who will exercise parental authority in
default of parents or a judicially appointed guardian,
in the order indicated: (SOC)
1. Surviving grandparent;
2. Oldest brother or sister, over 21 years of age,
unless unfit or disqualified; and
3. Actual Custodian over 21 years of age unless
unfit or disqualified (FAMILY CODE, Art. 216).
NOTE: The same order of preference shall be
observed when the appointment of a guardian
over the property of a child becomes necessary.
NOTE: The person exercising substitute
parental authority shall have the same authority
over the person of the child as the parents
(FAMILY CODE, Art. 233, par. 1).
In the Absence of the Legitimate Mother, the
Legitimate Father is still preferred over the
Grandparents
Notwithstanding the fact that private respondents'
(grandparents) demonstrated love and affection for
the boy, the legitimate father is still preferred over
the grandparents. The latter's wealth is not a
deciding factor, particularly because there is no
proof that at the present time, petitioner is in no
position to support the boy. The fact that he was
unable to provide financial support for his minor son
from birth up to over three years when he took the
boy from his in-laws without permission, should not
be sufficient reason to strip him of his permanent
right to the child's custody (Santos v. CA, G.R. No.
113054, March 16, 1995).
RULE IN CASE OF FOUNDLINGS,
ABANDONED, NEGLECTED OR
ABUSED CHILDREN AND OTHER
CHILDREN SIMILARLY SITUATED:
FOUNDLING
Newborn child abandoned by its parents who are
unknown (Bouvier’s Law Dictionary, 3rd Revision, p.
1293).
ABANDONED CHILD
One who has no proper parental care or
guardianship, or those whose parents or guardians
have deserted him for a period of at least 6
continuous months (P.D. 603, Art. 141, par. 2).
NEGLECTED CHILD
One whose basic needs have been deliberately
unattended or inadequately attended and may be
done through physical or emotional neglect (P.D.
603, Art. 141, par. 3). An abused child can come
within the emotionally-neglected child (STA.MARIA,
supra at 853).
PARENTAL AUTHORITY SHALL BE and its heads and teachers exercise over the pupils
ENTRUSTED IN SUMMARY JUDICIAL and students for as long as they are at attendance in
the school, including recess time.There is nothing in
PROCEEDING TO HEADS OF: (COS) the law that requires that for such liability to attach,
1. Children’s homes; the pupil or student who commits the tortious act
2. Orphanages; or must live and board in the school. In the view of the
3. Similar institutions duly accredited by the proper Court, the student is inthe custody of the school
government agency (FAMILY CODE, Art. 217). authorities as long as he is under the control and
SPECIAL PARENTAL AUTHORITY influence of the school and within its premises,
(ARTS. 218 AND 219) whether the semester has not yet begun or has
Can only be exercised by the school, already ended.
its administrators and teachers, or the individual,
entityor institution engaged in childcare over minors SPECIAL PARENTAL AUTHORITY V.
while under their supervision, instruction or SUBSTITUTE PARENTAL AUTHORITY
custody. The authority and responsibility alsoattach
to all authorized activities whether inside oroutside SPECIAL SUBSTITUTE
the premises of the school, entity or institution. PARENTAL PARENTAL
AUTHORITY AUTHORITY
The following shall be held principally and solidarily
As to When Exercised
liable for damages caused by the acts or omissions
of the unemancipated minor: (SAC) Rests on the theory that Exercised in case of
1. School; No distinction between academic or while the child is in the death, absence, or
non-academic (arts and trades). care and custody of the unsuitability of parents
2. Administrators and teachers; and person/s exercising (FAMILY CODE, Art.
3. Individual, entity or institution engaged in child special parental 216).
Care. authority, the parents
temporarily relinquish
NOTE: In no case shall the persons exercising parental authority.
special parental authority inflict corporal punishment
upon the child (FAMILY CODE, Art.233, par. 2).
As to Concurrence with Pa
ARTICLE 2180 OF THE CIVIL CODE
APPLIES IF THE STUDENT IS NO Concurrent with NOT exercised
parental authority. concurrently with the
LONGER A MINOR parents.
In Amadora v. CA, G.R. No. L-47745, April 15, 1988,
it was held that- where the school is academic rather
than technical or vocational in nature, responsibility As to Extent of Liability
for the tort committed by the student will attach to the
teacher in – charge of such student, following the Liability is principal and 1. Liability is direct
first part of the provision. This is the general rule. In solidary. and primary (See
the case of establishments of arts and trades, it is FAMILY CODE,
the head thereof, and only he, who shall be held Art. 219, par. 3 in
liable as an exception to the general rule. In other relation to FAMILY
words, teachers in general shall be liable for the acts CODE, Art. 221
of their students except where the school is technical and CIVIL CODE,
in nature, in which case it is the head thereof who Art. 2180).
shall be answerable. Following the canon of 2. If there are
reddendo singula singulis, "teachers" should apply persons exercising
to the words "pupils and students" and "heads of special parental
establishments of arts and trades" to the word authority – Liability
"apprentices". is only subsidiary
(i.e., only if the
PROTECTIVE AND SUPERVISORY persons with
special parental
CUSTODY authority cannot
As held in the case of Palisoc v. Brillantes, G.R. No. satisfy their
L-29025, October 4, 1971, the phrase "so long as liability).
(the students) remain in their custody" means the
protective and supervisory custody that the school
 self-discipline, self-reliance, industry and thrift,
SPECIAL SUBSTITUTE
stimulate their interest in civic affairs, and inspire
PARENTAL PARENTAL
in them compliancewith the duties of citizenship;
AUTHORITY AUTHORITY
d. To Enhance, protect, preserve, and
As to Defense of Exercise of Due Diligence maintain their physical and mental health at all
times;
Exercise of proper Exercise of diligence of e. To Furnish them with good and wholesome
diligence required a good father of a educational materials, supervise their activities,
under the particular family may be invoked recreation and association with others, protect
circumstances may FAMILY CODE, Art. them from bad company,and prevent themfrom
extinguish the principal 221) (Tamargo v. acquiring habits detrimental to their health,
and solidary liability Court of Appeals, G.R. studies and morals;
(FAMILY CODE, Art. 85044, June 3, 1992). f. To Demand from them respect and obedience
219). g. To Represent them in all matters affecting
their interests;
h. To Impose discipline on them as may be
PRINCIPLE OF PARENTAL LIABILITY required under the circumstances; and
The principle of parental liability (under Art. 221) is i. To Perform such other duties as are
a species of vicarious liability, or the doctrine of imposed by law upon parents and guardians
imputed negligence where a person is not only liable (FAMILY CODE, Art. 220).
for torts committed by himself, but also for torts
committed by others with whom he has a certain DUTIES OF PARENTS UNDER P.D. NO. 603:
relationship and for whom he is responsible. Parental (GESIS-PAGA)
liability is, in other words, anchored upon the a. To Give him affection, companionship and
parental authority coupled with the presumed understanding;
parental dereliction in the discharge of the duties b. To Extend to him the benefits of moral
accompanying such authority (Tamargo v. CA, G.R. guidance, self-discipline and religious
No. 85044, June 3, 1992). instruction;
c. To Supervise his activities, including his
VICARIOUS LIABILITY OR IMPUTED recreation;
NEGLIGENCE d. To Inculcate in him the value of industry, thrift
and self-reliance;
Parents and other persons exercising PA shall be e. To Stimulate his interest in civic affairs, teach
civilly liable for injuries and damages caused by him the duties of citizenship, and develop his
acts or omissions of their unemancipated children commitment to his country;
living in their company and under their PA subject f. To Provide him with adequate support, as
to appropriate defenses provided by law (FAMILY defined in Art. 194 of the Family Code;
CODE, Art. 221). g. To Advise him properly on any matter
affecting his development and well-being;
The parents may show that they exercised the h. To always set a good example; and
diligence of a good father of a family to remove i. To Administer his property, if any,according to
themselves from liability under Art. 221(STA.MARIA, his best interests, subject to the provisions of
supra at 869). Art. 225 of the Family Code (P.D. 603, Art. 46).

EFFECTS OF PARENTAL AUTHORITY PROCEDURE FOR IMPOSING DISCIPLINE ON

1. UPON THE PERSON OF THE
CHILDREN
RIGHTS AND DUTIES OF PARENTS AND THOSE
EXERCISING PARENTAL AUTHORITY: (KeG-
PEF- DRIP)
a. To Keep them in their company, to support,
educate and instruct them by right precept and
good example, and to provide for their
upbringing in keeping with their means;
b. To Give them love and affection, advice and
counsel, companionship, andunderstanding;
c. To Provide them with moral and spiritual
guidance, inculcate in them honesty, integrity,
THE CHILD
a. Parent or person exercising parental authority,
may petition the proper court of the place where
the child resides, for an order providing for
disciplinary measures over the child (FAMILY
CODE, Art. 223).
i. Relief prayed for may includecommitment in
entities or institutions engaged in child care
or in children’shomes duly accredited by the
proper government agency for not more
than 30 days.
ii. If petition is granted, parent shall not
interfere with the implementation of the
decision but shall continue to provide for his
support (FAMILY CODE, Art. 224).

b. There will be a summary hearing and the child
shall be entitled to the assistance of counsel,
either of his choice or appointed by the court
(FAMILY CODE, Art. 223).
c. If in the same proceeding the court findsthe
petitioner at fault, irrespective of the merits of
the petition, or when the circumstances so
warrant, the court may also order the
deprivation or suspension of parental authority
or adopt such other measures as it may deem
just and proper (FAMILY CODE, Art. 223).
d. The court may terminate the commitmentof
the child whenever just and proper (FAMILY
CODE, Art. 224).
2. UPON THE PROPERTY OF THE
CHILDREN
Administration of the Child’s Property by the
Parents
The father and the mother shall jointly exercise legal
guardianship over the property of the
unemancipated common child without the necessity
of a court appointment. In case of disagreement, the
father's decision shall prevail, unless there is a
judicial order to the contrary (FAMILY CODE, Art.
225).
NOTE: There are cases where a parent cannot be
the administrator of the property of his children
under the provisions on succession,Art. 923 and Art.
1035 of the Civil Code, on disinherited parent.
Bond Requirement
Parents are required to file a bond where the market
value of the property or the annual income of the
child exceeds P50,000. The bondshall not be less
than ten per centum (10%) of the value of the
property or annual income, to guarantee the
performance of the obligations prescribed for
general guardians (FAMILY CODE, Art. 225).
Fruits and Profits of Industry of Child:
a. Owned by the child;
b. Shall be devoted exclusively to the child’s
support and education unless the title or transfer
provides otherwise;
c. Parent may only use such fruits and income
primarily to the child's support and secondarily
to the collective daily needs of the family
(FAMILY CODE, Art. 226).
Administration or Management of Parents’
Property by Unemancipated Child
a. The net proceeds of such property shallbelong
to the parents-owner.
b. The child shall be given a reasonable monthly
allowance in an amount not less than that which
the owner would have paid if the administrator
were a stranger, unless the owner grants the
entire proceeds to the child.
c. The proceeds given in whole or in part shall not
be charged to the child's legitime (FAMILY
CODE, Art. 227).
NOTE: The courts may appoint a guardian of the
child’s property, or a guardian ad litem when the best
interests of the child so require (FAMILY CODE, Art.
222).
SUSPENSION AND TERMINATION OF
PARENTAL AUTHORITY
Grounds for suspension: (CEO-BAN)
1. Conviction of a crime with the penalty of civil
interdiction; (FAMILY CODE, Art. 230).
2. Excessively harsh or cruel treatment against
the child;
3. Orders, counsel or example which are
corrupting, given by the person exercising
authority;
4. Child is compelled to Beg;
5. Subjecting child or allowing child to be
subjected to Acts of lasciviousness; or
6. Negligence, which is culpable, committed by
the person exercising authority (FAMILY
CODE, Art. 231).
Necessity of Court Order for Suspension,
Revocation, and Revival of Parental Authority
GENERAL RULE: The suspension or deprivation
maybe revoked and parental authority revived if the
court finds that the cause has ceased and will not
be repeated (FAMILY CODE, Art. 231, par. 4).
EXCEPTION: In case of conviction for a crime which
carries with it the penalty of civil interdiction, the
authority is automatically reinstated upon service of
penalty or pardon or amnesty of the offender
(FAMILY CODE, Art. 230).
GROUNDS FOR TERMINATION OF
PARENTAL AUTHORITY
PERMANENT TERMINATION: (DEDS)
1. Death of the parents;
2. Emancipation of the child;
3. Death of the child; and
4. If the person exercising parental authority has
subjected the child or allowed him to be
subjected to Sexual abuse (FAMILY CODE, Art.
228; Art. 232).
OTHER GROUNDS FOR TERMINATION OF
PARENTAL AUTHORITY: (I-DAGA)
1. Upon Adoption of the child;
2. Upon appointment of a General guardian;
3. Upon judicial declaration of Abandonment ofthe
child in a case filed for the purpose;
4. Upon final judgment of a competent court
Divesting the party concerned of parental
 authority; or
5. Upon judicial declaration of absence or
Incapacity of the person exercising parental
authority (FAMILY CODE, Art. 229).
LOSS OF PARENTAL AUTHORITY
UNDER THE REVISED PENAL CODE
Any parent of a child under sixteen years of age, who
shall deliver such child gratuitously or in
consideration of any price, compensation or
promise to any person being an acrobat, gymnast,
rope-walker, diver, wild-animal tamer or circus
manager or engaged in a similar calling who
employs said child in exhibitions or to any habitual
vagrant or beggar may be deprived, temporarily or
perpetually, in the discretion of the court, of their
parental authority (REVISED PENAL CODE, Art.
278, par. 4).
LOSS OF PARENTAL AUTHORITY
UNDER R.A. NO. 7610
Sec. 10 (c) of R.A. 7610 provides as penalty,
among others, the loss of parental authority to any
ascendant, stepparent, or guardian of a minor, who
shall induce, deliver or offer such minor under his
custody to persons prohibited by this Act to keep
persons described and enumerated in Sec. 10 (b).
Sec. 10 (b) of the R.A. No. 7610 punishes anyperson
who shall keep or have in his company a minor:
1. Who is 12 years old or younger in any public or
private place, hotel, motel, beer joint,
discotheque, cabaret, pension house, sauna or
massage parlor, beach, and/or other tourist
resort or similar places; or
2. Who is 10 or more years his junior, in the places
enumerated in (1).
NOTE: The same provision does not apply to any
person who is related to the minor within the fourth
degree of consanguinity or affinity or any bond
recognized by law, local customand tradition or acts
in the performance of a social, moral, or legal duty.
R.A. NO. 8972: SOLO PARENTS’
WELFARE ACT OF 2000 (EFFECTIVE
NOVEMBER 28, 2000)
DEFINITION OF TERMS
SOLO PARENT refers to any individual who falls
underany of the following categories: (RaDe-DISNA-
Un- OF)
1. A woman who gives birth as a result of Rape and
other crimes against chastity even without a final
conviction of the offender: Provided, That the
mother keeps and raises the child;
2. Parent left solo or alone with the responsibility of
parenthood due to Death of spouse;
3. Parent left solo or alone with the responsibility of
parenthood while the spouse is Detained or is
serving sentence for a criminal conviction for at
least one (1) year;
4. Parent left solo or alone with the responsibility of
parenthood due to physical and/or mental
Incapacity of spouse as certified by a public
medical practitioner;
5. Parent left solo or alone with the responsibility of
parenthood due to legal separation or de facto
Separation from spouse for at least one (1) year,
as long as he/she is entrusted with the custody
of the children;
6. Parent left solo or alone with the responsibility of
parenthood due to declaration of Nullity or
annulment of marriage as decreed by a court or
by a church as long as he/she is entrusted with
the custody of the children;
7. Parent left solo or alone with the responsibility of
parenthood due to Abandonment of spouse for
at least one (1)year;
8. Unmarried mother/father who has preferred to
keep and rear her/his child/children instead of
having others care for them or give them up to a
welfare institution;
9. Any Other person who solely provides parental
care and support to a child or children;
10. Any Family member who assumes the
responsibility of head of family as a resultof
the death, abandonment, disappearance or
prolonged absence of the parents or solo
parent for at least 1 year (R.A. No. 8972, Sec. 3,
par. (a)).
CHILDREN refer to those living with and dependent
upon the solo parent for support who are unmarried,
unemployed, and not more than 18 years of age, or
even over 18 years but are incapable of self-support
because of mental and/or physical defect/disability
(R.A. No. 8972, Sec. 3. Par (b)).
PARENTAL RESPONSIBILITY, with respect to
their minor children, shall refer to the rights and
duties of the parents as defined in Article 220 of
Executive Order No. 209, as amended, otherwise
known as the “Family Code of the Philippines” (R.A.
No. 8972, Sec. 3. Par (c)).
BENEFITS OF A SOLO PARENT
1. Leave Benefit
In addition to leave privileges under existing
laws, parental leave of not more than 7 working
days every year shall be granted to any solo
parent employee who has rendered service of at
least 1 year. The7-day parental leave shall be
non-cumulative (IRR of R.A. No. 8972, Sec.
18).
2. Flexible Work Schedule
The employer shall provide for a flexible work
schedule for solo parents. The schedule should
not, however, affect theindividual and company
productivity (R.A. No. 8972, Sec. 6).
3. Educational Benefits
The DECS, CHED and TESDA shall provide the
following benefits and privileges: scholarship
programs for qualified solo parents and their
children in institutions of basic, tertiary and
technical/skills education; and nonformal
education programs appropriate for solo parents
and their children (R.A. No. 8972, Sec. 9).
4. Housing Benefits
Solo parents shall be given allocation in housing
projects and shall be provided with liberal terms
of payment on said government low-cost
housing projects in accordance with housing law
provisions prioritizing applicants below the
poverty lineas declared by the NEDA (R.A. No.
8972, Sec. 10).
5. Medical Assistance
The DOH shall develop a comprehensive health
care program for solo parents and their children.
The program shall be implemented by the DOH
through their retained hospitals and medical
centers and the local government units (LGUs)
through their provincial/district/city/municipal
hospitals and rural health units (RHUs) (R.A. No.
8972, Sec. 11).
EMANCIPATION
(ARTS. 234-237)
Emancipation takes place by the attainment of the
age of majority. Unless otherwise provided, majority
commences at the age of 18 years (FAMILY CODE,
Art. 234 as amended by R.A. 6809).
EFFECT OF EMANCIPATION
Emancipation for any cause shall terminate parental
authority over the person and property of the child
who shall then be qualified and responsible for all
acts of civil life, save the exceptions established by
existing laws in special cases (FAMILY CODE, Art
236 as amended by R.A. 6809).
Upon the effectivity of this Act on December 13,
1989, existing wills, bequests, donations, grants,
insurance policies, and similar instruments
containing references and provisions favorable to
minors will not retroact to their prejudice (R.A. No.
6809, Sec. 4).
SUMMARY JUDICIAL
PROCEEDINGS IN THE
FAMILY LAW
(ARTS. 238-253)
ACTIONS REQUIRING SUMMARY
JUDICIAL PROCEEDINGS UNDER THE
FAMILY CODE:
1. Obtaining a judicial declaration of presumptive
death for the purpose of contracting a
subsequent marriage (FAMILY CODE, Art. 41);
2. In case of legally separated spouses, when the
consent of one spouse to any transaction of the
other is required by law, judicial authorization
shall be obtained in a summary proceeding
(FAMILY CODE, Art. 100, par. 2);
3. In case of legally separated spouses, when the
community property is not sufficient for the
support of the family each spouse is liable with
his/her separate property. The spouse present
shall file before the court a petition for the
administration of the specific separate property
of the other spouse and the use of the fruits or
proceeds to satisfy the latter’s share (FAMILY
CODE, Art. 100, par. 3);
4. Entrusting parental authority over foundlings,
abandoned, neglected, and abused children to
heads of children’s homes and orphanages
(FAMILY CODE, Art. 217);
5. Providing for disciplinary measures over the
child at the motion of the parents or any person
exercising parental authority (FAMILY CODE,
Art. 223);
6. For the filing of a bond to enable the parents of
a minor to exercise legal guardianship over the
latter’s properties, when the value of said
properties exceeds P50,000 (FAMILY CODE,
Art. 225);
7. Determination of the value of the presumptive
legitimes in cases of partition of the conjugal
dwelling (FAMILY CODE, Art. 51);
8. In case of disagreement in fixing the family
domicile (FAMILY CODE, Art. 69);
9. In case of objection to a spouse’s exercise of
legitimate profession (FAMILY CODE, Art. 73);
10. In case of disagreement in the administration
and enjoyment of the community
property/conjugal partnership (FAMILY CODE,
Art. 96; Art. 124);
11. When a husband and wife are separated infact,
or one has abandoned the other and one of
 them seeks judicial authorization for
transaction (FAMILY CODE, Art. 239).
PROCEDURE: (F-NOPE-DJ)
1. Upon Filing of a verified petition in the family
court where the spouses reside (or in the RTC,
if there is no family court), jurisdiction of said
court over the petition shall attach upon proof of
notice to the other spouse.
2. Notice to the non-petitioning spouse shall
include a show cause order why the petition
should not be granted
3. The non-petitioning spouse is given the
Opportunity to answer on or before the date set
for the initial conference as indicated in the
notice.
4. The Preliminary conference shall be conducted
by the judge personally, and the spouses shall
not be assisted by counsel. After the initial
conference, the spouses may be assisted by
counsel at the court’s discretion.
5. The court may proceed Ex parte and render
judgment if despite all efforts, the non-
petitioning spouse does not appear.
6. If both spouses are present during the initial
conference and the petition is not resolved then,
the petition shall be Decided in a summary
hearing on the basis of affidavits submitted.
7. The Judgment of the court shall be immediately
final and executory (FAMILY CODE, Arts. 239-
248).
RULE ON DECLARATION
OF ABSOLUTE NULLITY
OF VOID, MARRIAGES
AND ANNULMENT OF
VOIDABLE MARRIAGES
(A.M. NO. 02-11-10-SC)
This Rule became effective on March 15, 2003 (A.M.
No. 02-11-10-SC, Sec. 25) and governs petition for
declaration of absolute nullity of void marriages and
annulment of voidable marriages (A.M. No. 02-11-
10-SC, Sec. 1). This rule covers marriages under the
Family Code of the Philippines and is prospective in
its application (Enrico vs. Heirs of Sps. Eulogio B.
Medinaceli and Trinidad Catli-Medinaceli, G.R. No.
173614, September 28, 2007).
NATURE OF AN ACTION FOR
ANNULMENT OF MARRIAGE
This is an action in rem, for it concerns the status of
a the parties herein, and status affects or binds the
whole world. The court has jurisdiction over the
res, in an action for annulment of marriage,
provided, at least, one of the parties is domiciled in,
or a national of, the forum (Rayray vs. Chae Kyung
Lee, No. L-18176, October 26, 1966).
ACTION TO NULLIFY MARRIAGE MUST
BE MADE IN A DIRECT ACTION
A petition for correction or cancellation of an entry
in the civil registry cannot substitute for an action to
invalidate a marriage. A direct action is necessary
to prevent circumvention of the substantive and
procedural safeguards of marriage under the Family
Code, A.M. No. 02-11-10-SC and other related laws
(Republic vs. Olaybar, G.R. No. 189538, February
10, 2014).
It was reiterated in a criminal case for falsification of
public documents (marriage certificate) where the
court held that the validity of marriage cannot be
collaterally attacked since under existing laws and
jurisprudence, the same may be questioned only in
a direct action. A direct action is necessary to
prevent circumvention of the substantive and
procedural safeguards of marriage (Corpuz, Jr. vs.
People, G.R. Nos. 212656-57, November 23, 2016).
A.M. NO. 02-11-10-SC RULE DOES NOT
APPLY TO RECOGNITION OF FOREIGN
DIVORCE
The procedure in A.M. No. 02-11-10-SC does not
apply in a petition to recognize a foreign judgment
annulling a bigamous marriage where one of the
parties is a citizen of the foreign country. A petition
for recognition does not require a re-litigation of the
case as if it were a new petition for declaration of
nullity of marriage (Fujiki vs. Marinay, G.R. No.
196049, June 26, 2013).
WHO MAY FILE A PETITION FOR
DECLARATION OF ABSOLUTE NULLITY
OF VOID MARRIAGE
A petition for declaration of absolute nullity of void
marriage may be filed solely by the husband or the
wife (A.M. No. 02-11-10-SC, Sec. 2).
NOTE: Section 2(a) of A.M. No. 02-11-10-SC does
not preclude a spouse of a subsisting marriage to
question the validity of a subsequent marriage on the
ground of bigamy. On the contrary, when Section
2(a) states that “[a] petition for declaration of
absolute nullity of void marriage may be filed solely
by the husband or the wife” — it refers to the
husband or the wife of the subsisting marriage (Fujiki
vs. Marinay, G.R. No. 196049 June 26, 2013).
Only an aggrieved or injured spouse may file a
petition for annulment of voidable marriages or
declaration of absolute nullity of void marriages.
Such petition cannot be filed by compulsory or
intestate heirs of the spouses or by the State (Enrico
vs. Heirs of Sps. Eulogio B. Medinaceli and Trinidad
Catli-Medinaceli, G.R. No. 173614, September 28,
2007).
PROHIBITION AGAINST HEIRS TO FILE
THE PETITION DOES NOT APPLY IF THE
CASE IS FILED BEFORE EFFECTIVITY
OF THE RULE
The Rule does not apply to cases already
commenced before March 15, 2003 although the
marriage involved is within the coverage of the
Family Code. This is so, as the new Rule which
became effective on March 15, 2003 is prospective
in its application (Carlos vs. Sandoval, G.R. No.
179922, December 16, 2008).
While the Family Code is silent with respect to the
proper party who can file a petition for declaration
of nullity of marriage prior to A.M. No. 02-11-10-SC,
it has been held that in a void marriage, in which no
marriage has taken place and cannot be the source
of rights, any interested party (an heir) may attack
the marriage directly or collaterally without
prescription, which may be filed even beyond the
lifetime of the parties to the marriage (Juliano-Llave
vs. Republic, G.R. No. 169766, March 30, 2011).
RECOURSE OF HEIRS IN QUESTIONING
THE VALIDITY OF MARRIAGE
While A.M. No. 02-11-10-SC declares that apetition
for declaration of absolute nullity of marriage may
be filed solely by the husband or the wife, it does not
mean that the compulsory or intestate heirs are
without any recourse under the law. Compulsory or
intestate heirs can still question the validity of the
marriage of the spouses, not in a proceeding for
declaration of nullity but upon the death of a spouse
in a proceeding for the settlement of the estate of
the deceased spouse filed in the regular courts
(Carlos vs. Sandoval, G.R. No. 179922, December
16, 2008).
WHO MAY FILE A PETITION FOR
ANNULMENT OF VOIDABLE
MARRIAGE: (CIF-FCS)
1. The contracting party whose parent, or
guardian, or person exercising substitute
parental authority did not give his or her
Consent, within five years after attaining theage
of twenty-one unless, after attaining theage of
twenty-one, such party freely cohabitated with
the other as husband or wife; or the parent,
guardian or person having legal charge of the
contracting party , at any time before such party
has reached the age of twenty-one;
2. The sane spouse who had no knowledge of the
other's Insanity; or by any relative, guardian, or
person having legal charge of the insane, at any
time before the death of either party; or by the
insane spouse during a lucid interval or after
regaining sanity, provided that the petitioner,
after coming to reason, has not freely cohabited
with the other as husband or wife;
3. The injured party whose consent was obtained
by Fraud, within five years after the discovery of
the fraud, provided that said party, with full
knowledge of the facts constituting the fraud,
has not freely cohabited with the other as
husband or wife;
4. The injured party whose consent was obtained
by Force, intimidation, or undue influence,
within five years from the time the force
intimidation, or undue influence disappeared or
ceased, provided that the force, intimidation, or
undue influence having disappeared or ceased,
said party has not thereafter freely cohabited
with the other as husband or wife;
5. The injured party where the other spouse is
physically incapable of Consummating the
marriage with the other and such incapability
continues and appears to be incurable, within
five years after the celebration of marriage; and
6. The injured party where the other party was
afflicted with a Sexually-transmissible disease
found to be serious and appears to be incurable,
within five years after the celebration of marriage
(A.M. No. 02-11-10-SC, Sec. 3).
VENUE OF THE PETITION
The Petition shall be filed in the Family Court of the
province or city where the petitioner or the
respondent has been residing for at least six months
prior to the date of filing. Or in the case of non-
resident respondent, where he may be found in the
Philippines, at the election of the petitioner (A.M.
No. 02-11-10-SC, Sec. 4).
IN CASE THE RESPONDENT FAILS TO
ANSWER, THE PROSECUTOR SHALL
INVESTIGATE WHETHER THERE IS A
COLLUSION
Where no answer is filed or if the answer does not
tender an issue, the court shall order the public
prosecutor to investigate whether collusion exists
between the parties (A.M. No. 02-11-10-SC, Sec. 8).
CERTIFICATION FROM THE SOLICITOR
GENERAL NO LONGER REQUIRED IN
AN ACTION FOR NULLITY UNDER
ARTICLE 36
The requirement in Molina that the Solicitor General
must issue a certification stating his reasons for his
agreement or opposition to the petition was
dispensed with following the implementation of A.M.
No. 02-11-10-SC, or the Rule on Declaration of
Absolute Nullity of Void Marriages and Annulment of
Voidable Marriages. Still, Article 48 of the Family
Code mandates that the appearance of the
prosecuting attorney or fiscal assigned be on behalf
of the State to take steps to prevent collusion
between the parties and to take care that evidence
is not fabricated or suppressed (Antonio vs. Reyes,
G.R. No. 155800, March 10, 2006)
NOTE: Nevertheless, the court may require the
parties and the public prosecutor, in consultation
with the Office of the Solicitor General, to file their
respective memoranda in support of their claims
within fifteen days from the date the trial is
terminated. It may require the Office of the Solicitor
General to file its own memorandum if the case is
of significant interest to the State (A.M. No. 02-11-
10-SC, Sec. 18).
PROHIBITED COMPROMISE (CVL-SJL)
1. The Civil status of persons;
2. The Validity of a marriage or of a legal
separation;
3. Any ground for Legal separation;
4. Future Support;
5. The Jurisdiction of courts; and
6. Future Legitime (A.M. No. 02-11-10-SC,
Sec.16).
MOTION FOR RECONSIDERATION
REQUIRED BEFORE AN APPEAL
No appeal from the decision shall be allowed unless
the appellant has filed a motion for reconsideration
or new trial within fifteen days from notice of
judgment (A.M. No. 02-11-10-SC, Sec. 18,par. 1).
FINALITY OF DECISION
The decision becomes final upon the expiration of
fifteen days from notice to the parties. Entry of
judgment shall be made if no motion for
reconsideration or new trial, or appeal Is filed by any
of the parties, the public prosecutor, or the Solicitor
General (A.M. No. 02-11-10-SC, Sec. 19, par. 3).
EFFECT OF DEATH OF ONE OF THE
PARTIES
1. In case a party dies at any stage of the
proceedings before the entry of judgment, the
court shall order the case closed and
terminated, without prejudice to the settlement
of the estate in proper proceedings in the regular
courts (A.M. No. 02-11-10-SC, Sec. 24, par.1).
2. If the party dies after the entry of judgment of
nullity or annulment, the judgment shall be
binding upon the parties and their successors
in interest in the settlement of the estate in the
regular courts (A.M. No. 02-11-10-SC, Sec. 24,
par. 2).
SERVICE AND EFFECT OF DECISION
GRANTING PETITION
1. The parties, including the Solicitor General and
the public prosecutor, shall be served with
copies of the decision personally or by
registered mail. If the respondent summonedby
publication failed to appear in the action, the
dispositive part of the decision shall be
published once in a newspaper of general
circulation (A.M. No. 02-11-10-SC, Sec. 19, par.
2).
2. Upon the finality of the decision, the court shall
forthwith issue the corresponding decree if the
parties have no properties (A.M. No. 02-11-10-
SC, Sec. 19, par. 4).
3. If the parties have properties the parties shall
proceed with the liquidation, partition and
distribution of the properties of the spouses,
including custody, support of common children
and delivery of their presumptive legitimes
pursuant to Articles 50 and 51 of the Family
Code unless such matters had been
adjudicated in previous judicial proceedings
(A.M. No. 02-11-10-SC, Sec. 21).
NOTE: Decree of nullity will be issued by the court
only after compliance with Articles 50 and 51 (A.M.
No. 02-11-10-SC, Sec. 19, par. 1). If the parties have
no properties, upon finality of the decision, the court
will issue the corresponding decree (A.M. No. 02-11-
10-SC, Sec. 19, par. 4).
DECREE WILL BE REGISTERED IN THE
CIVIL REGISTRY
The prevailing party shall cause the registration of
the Decree in the Civil Registry where the marriage
was registered, the Civil Registry of the place
where the Family Court is situated, and in the
National Census and
Statistics Office. He shall report td the court
compliance with this requirementwithin thirty days
from receipt of the copy of theDecree (A.M. No.
02-11-10-SC, Sec. 23, par. 1).
WHEN PUBLICATION OF DECREE IS
REQUIRED
In case service of summons was made by
publication, the parties shall cause the publication
of the Decree once in a newspaper of general
circulation (A.M. No. 02-11-10-SC, Sec. 23, par. 2).

RULE ON LEGAL
SEPARATION
(A.M. NO. 02-11-11-SC)
WHO MAY FILE:
The husband or the wife (A.M. No.02-11-11-SC,
Sec. 2 (a)).
WHEN TO FILE:
The petition for legal separation may be filed within
five (5) years from the time of the occurrence of any
of the following grounds: (VP-61- BALIDS)
1. Repeated physical Violence or grossly abusive
conduct directed against the petitioner, a
common child, or a child of the petitioner;
2. Physical violence or moral Pressure to compel
the petitioner to change religious or political
affiliation;
3. Final judgment sentencing the respondent to
imprisonment of more than six (6) years, even if
pardoned;
4. Abandonment of petitioner by respondent
without justifiable cause for more than one (1)
year;
5. Contracting by the respondent of a subsequent
Bigamous marriage, whether in or outside the
Philippines;
6. Attempt on the life of petitioner by the
respondent;
7. Lesbianism or homosexuality of the
respondent;
8. Attempt of respondent to corrupt or Induce the
petitioner, a common child, or a child of the
petitioner, to engage in prostitution, or
connivance in such corruption or inducement;
and
9. Drug addiction or habitual alcoholism of the
respondent; and
10. Sexual infidelity or perversion of respondent
(A.M. No. 02-11-11-SC, Sec. 2 (a)).
MOTION TO DISMISS
No motion to dismiss the petition shall be allowed
except on the ground of lack of jurisdiction over the
subject matter or over the parties (A.M. No. 02-11-
11-SC, Sec. 4).
LIQUIDATION, PARTITION AND
DISTRIBUTION, CUSTODY, AND
SUPPORT OF MINOR CHILDREN
Upon entry of the judgment granting the petition, or,
in case of appeal, upon receipt of the entry of
judgment of the appellate court granting the petition,
the Family Court, on motion of either party, shall
proceed with the liquidation, partition and distribution
of the properties of the spouses, including custody
and support of common children, under the Family
Code unless such matters had been adjudicated in
previous judicial proceedings (A.M. No. 02-11-11-
SC, Sec. 18).
WHEN MAY THE COURT ISSUE A
DECREE OF LEGAL SEPARATION
1. After registration of the entry of judgment
granting the petition tor legal separation in the
Civil Registry where the marriage was
celebrated and in the Civil Registry where the
Family Court is located; and
2. After registration of the approved partition and
distribution of the properties of the spouses, in
the proper Register of Deeds where the real
properties are located (A.M. No. 02-11-11-SC,
Sec. 19).
PETITION FOR REVOCATION OF
DONATIONS
WHEN TO FILE: Within five (5) years from the date
the decision granting the petition for legal
separation has become final, the innocent spouse
may file a petition under oath in the same proceeding
for legal separation to revoke the donations in favor
of the offending spouse.
WHERE RECORDED: The revocation of the
donations shall be recorded in the Register of
Deeds in the places where the properties are
located.
NOTE: Alienations, liens, and encumbrances
registered in good faith before the recording of the
petition for revocation in the registries of property
shall be respected.
After the issuance of the Decree of Legal
Separation, the innocent spouse may revoke the
designation of the offending spouse as a beneficiary
in any insurance policy even if suchdesignation be
stipulated as irrevocable. The revocation or change
shall take effect upon written notification thereof to
the insurer (A.M. No. 02-11- 11-SC, Sec. 22).
DECREE OF RECONCILIATION
1. If the spouses had reconciled, a joint
manifestation under oath, duly signed by the
spouses, may be filed in the same proceeding
for legal separation.
2. If the reconciliation occurred while the
proceeding for legal separation is pending, the
court shall immediately issue an order
terminating the proceeding.
3. If the reconciliation occurred after the rendition
of the judgment granting the petition for legal
 separation but before the issuance of the
Decree, the spouses shall express in their
manifestation whether or not they agree to
revive the former regime of their property
relations or choose a new regime.
The court shall immediately issue a Decree of
Reconciliation declaring that the legalseparation
proceeding is set aside and specifying the
regime of property relations under which the
spouses shall be covered.
4. If the spouses reconciled after the issuance of
the Decree, the court, upon proper motion, shall
issue a decree of reconciliation declaring therein
that the Decree is set aside but theseparation of
property and any forfeiture of the share of the
guilty spouse already effected subsists, unless
the spouses have agreed to revive their former
regime of property relations or adopt a new
regime.
5. If the reconciled spouses choose to adopt a
regime of property relations different from that
which they had prior to the filing of the petition
for legal separation, the spouses shall comply
with Section 24 by filing a verified motion for
revival indicating the property to be contributed
or retained and the names, addresses and
amounts owing to creditors.
6. The decree of reconciliation shall be recorded
in the Civil Registries where the marriage and
the Decree had been registered (A.M. No. 02-
11-11-SC, Sec. 23).
RULE ON PROVISIONAL ORDERS (A.M.
NO. 02- 11-12-SC)
RULES FOR SPOUSAL SUPPORT
In determining support for the spouses, the court
may be guided by the following rules:
1. It is based on written agreement between the
spouses;
2. In the absence of (1), the spouses may be
supported from the properties of the absolute
community or the conjugal partnership;
3. The court may award support to either spouse in
such amount and for such period of time as the
court may deem just and reasonable based on
their standard of living during the marriage; and
The court may likewise consider the
following factors:
a. whether the spouse seeking support is the
custodian of a child whose circumstances
make it appropriate for that spouse not to
seek outside employment;
b. the time necessary to acquire sufficient
education and training to enable the spouse
seeking support to find appropriate
employment, and that spouse's future
earning capacity;
c. the-duration of the marriage;
d. the comparative financial resources of the
spouses, including their comparative
earning abilities in the labor market;
e. the needs and obligations of each spouse;
f. the contribution of each spouse to the
marriage, including services rendered in
home-making, child care, education, and
career building of the other spouse;
g. the age and health of the spouses;
h. the physical and emotional conditions ofthe
spouses;
i. the ability of the supporting spouse to give
support, taking into account that spouse's
earning capacity, earned and unearned
income, assets, and standard of living; and
j. any other factor the court may deem just and
equitable.
4. The Family Court may direct the deduction of the
provisional support from the salary of the spouse
(A.M. No. 02-11-12-SC, Sec. 2).
DETERMINATION OF THE AMOUNT OF
PROVISIONAL CHILD SUPPORT
The common children of the spouses shall be
supported from the properties of the absolute
community or the conjugal partnership.
The Following Factors Are Considered:
1. The financial resources of the custodial andnon-
custodial parent and those of the child;
2. The physical and emotional health of the child
and his or her special needs and aptitudes;
3. The standard of living the child has been
accustomed to;
4. The non-monetary contributions that theparents
will make toward the care and well- being of the
child.
The Family Court may direct the deduction of the
provisional support from the salary of the parent
(A.M. No. 02-11-12-SC, Sec. 3).
CONSIDERATION IN DETERMINING THE
RIGHT PARTY TO WHOM CHILD
CUSTODY WILL BE AWARDED
In determining the right party or person to whom
the custody of the child of the parties may be
awarded pending the petition, the court shall
consider the best interests of the child and shall give
paramount consideration to the material and moral
welfare of the child (A.M. No. 02-11-12-SC, Sec. 4).
ORDER OF PREFERENCE IN
DETERMINING CHILD CUSTODY
1. To both parents jointly;
2. To either parent taking into account all relevant
considerations under the foregoing paragraph,
especially the choice of the child over seven
years of age, unless the parent chosen is unfit;
3. To the surviving grandparent, or if there are
several of them, to the grandparent chosen by
the child over seven years of age and of
sufficient discernment, unless the grandparent is
unfit or disqualified;
4. To the eldest brother or sister over twenty-one
years of age, unless he or she is unfit or
disqualified;
5. To the child's actual custodian over twenty-one
years of age, unless unfit or disqualified; or
6. To any other person deemed by the court
suitable to provide proper care and guidance
for the child (A.M. No. 02-11-12-SC, Sec. 4).
VISITATION RIGHTS
Appropriate visitation rights shall be provided to the
parent who is not awarded provisional custody
unless found unfit or disqualified by the court (A.M.
No. 02-11-12-SC, Sec. 5).
ADMINISTRATION OF COMMON
PROPERTY IN CASE OF
ABANDONMENT
If a spouse without just cause abandons the other
or fails to comply with his or her obligations to the
family, the court may, upon application of the
aggrieved party under oath, issue a provisional order
appointing the applicant or a third person as receiver
or sole administrator of the common property subject
to such precautionary conditions it may impose
(A.M. No. 02-11-12-SC, Sec. 8).
NOTE: The receiver or administrator may not
dispose of or encumber any common property or
specific separate property of either spouse without
prior authority of the court (A.M. No. 02-11-12-SC,
Sec. 8).
USE OF SURNAMES
(ARTS. 364-380)
NAME
It is a word or combination of words by which a
person is known and identified, and as distinguished
from others, for the convenience of the world at large
in addressing him, or in speaking of or dealing with
him (1 TOLENTINO, supra at 672). The surname or
family name is that which identifies the family to
which he belongs and is continued from parent to
child. The given name may be freely selected by the
parents for the child, but the surname to which the
child is entitled is fixed by law (In the matter of the
adoption of Stephanie Nathy Astorga Garcia, G.R.
No. 148311,March 31, 2005).
NOTE: The right to a surname is not exclusive. It
does not pertain in ownership to any determinate
person (Id. at 673).
RULES ON THE SURNAME OF A
MARRIED WOMAN
1. A married woman may use:
a. Her maiden first name and surname and
add her husband's surname (e.g., Aurora
Aragon - Quezon); or
b. Her maiden first name and her husband's
surname (e.g.: Aurora Quezon); or
c. Her husband's full name, but prefixing a
word indicating that she is his wife, such as
"Mrs.” (e.g.: Mrs. Manuel Quezon) (CIVIL
CODE, Art. 370).
d. Her maiden name upon marriage (e.g.,
Aurora Aragon) (Remo v. Sec. of Foreign
Affairs, G.R. No. 169202, March 5, 2010).
A married woman has an option but not a duty
to use the surname of the husband. She is
therefore allowed to use not only any of the three
names provided in Article 370, but also her
maiden name upon marriage. She is not
prohibited from continuously using her maiden
name once she is married because when a
woman marries, she does not change her name
but only her civil status (Remo v. Sec. of Foreign
Affairs, G.R. No. 169202, March 5, 2010).
NOTE: Once a married woman opted to adopt
her husband’s surname in her passport, she
may not revert to the use of her maiden name,
except in the cases enumerated in Section 5(d)
of RA 8239:
1) Death of husband;
2) Divorce;
3) Annulment; or
4) Nullity of marriage.
2. In case of annulment of marriage
a. If the wife is the guilty party, she shall
resume her maiden name and surname.
b. If she is the innocent spouse, she may
resume her maiden name and surname.
However, she may choose to continue
employing her former husband's surname,
unless:
i. The court decrees otherwise, or
ii. She or the former husband is married
 again to another person (CIVIL CODE,
Art. 371).
3. When legal separation has been
granted, the wife shall continue using
her name and surname employed
before the legal separation (CIVIL CODE,
Art. 372).
NOTE: The language of the statute is
mandatory that the wife, even after the legal
separation has been decreed, shall continue
using her name and surname employed before
the legal separation. This is so because her
married status is unaffected by the separation,
there being no severance of the vinculum. It
seemsto be the policy of the law that the wife
should continue to use the name indicative of
her unchanged status for the benefit of all
concerned (Laperal v. Republic, G.R. No. L-
18008, October 30, 1962).
4. A widow may use the deceased
husband's surname as though he were
still living, in accordance with Art. 370
(CIVIL CODE, Art.373).
USE OF SURNAME BY THE CHILD
CHILD SURNAME
Legitimate Surname of father, principally
(CIVIL CODE, Art. 364).
Legitimated Surname of father, principally
(CIVIL CODE, Art. 364).
Conceived Surname of father (CIVIL
before the CODE, Art. 369).
decree
annulling a Grandsons and other direct male descendants
voidable
marriage
Illegitimate Generally, surname of mother
(CIVIL CODE, Art. 368).
NOTE: “Principally” used in Article 364 is not
equivalent to “exclusively”, so that there is no legal
obstacle if a legitimate or legitimated child should
choose to use the surname of the mother to whichit
is legally entitled (Alfon v. Republic, G.R. No. L-
51201, May 29,1980).
Reading Article 364 of the Civil Code together with
the State's declared policy to ensure the
fundamental equality of women and men before the
law, a legitimate child is entitled to use the surname
of either parent as a last name (Alanis III vs Court of
Appeals, G.R. No. 216425, November 11, 2020).
USE OF THE MOTHER’S SURNAME AND
SIGNATURE IS REQUIRED FOR HER
ILLEGITIMATE CHILDREN’S BIRTH
CERTIFICATES
The IRR of R.A. No. 9255 states that illegitimate
children shall use the surname and shall be under
the parental authority of their mother. The
discretion on the part of the illegitimate childto use
the surname of the father is conditional uponproof of
compliance with R.A. No. 9255 and its IRR.
It is mandatory that the mother of an illegitimate
child signs the birth certificate of her child in all
cases, irrespective of whether the father recognizes
the child as his or not. The only legally known parent
of an illegitimate child, by the fact of illegitimacy, is
the mother of the child who conclusively carries the
blood of the mother (In re: Yuhares Jan Barcelote
Tinitigan, G.R. No. 222095, August 7, 2017).
IDENTITY OF NAMES AND SURNAMES
1. The younger person shall be obliged to use such
additional name or surname as will avoid
confusion (CIVIL CODE, Art. 374).
2. Between ascendants and descendants, the
word "Junior" can be used only by a son.
shall either:
a. Add a middle name or the mother's
surname, or
b. Add the Roman Numerals II, III, and so on
(CIVIL CODE, Art. 375).

May use surname of father if
filiation has been expressly
recognized by the father through
the record of birth appearing in
the civil register, or when an
admission in a public document
or private handwritten
instrument is made by the father
(CIVIL CODE, Art. 282).
Adopted Surname of adopter
(CIVILCODE, Art. 365).
Art. 375 restricts the use of “Junior” but social usage
allows the use of “Junior” also for daughters,not for
granddaughters (1 PARAS, supra at 875).
NOTE: Article 376 on the change of name or
surname has been repealed by R.A. No. 9048
(2001).
CHANGE OF NAME
Change of name is a matter of public interest. It is
not a right. It is a privilege. The court may give or
withhold its consent (In the Matter of the Petition for
Change of Name, Go Chiu Beng v. Republic of the
Philippines, G.R. No. L-29574, August 19, 1972).
APPLICATION FOR CHANGE OF NAME
Change of name is a judicial proceeding in rem.
Jurisdiction to hear and determine a petition
therefore, by law, is acquired after publication
hearing thereof – for 3 successive weeks in a
newspaper of general circulation. But, for that
publication to be effective, it must give correct
information.
For purposes of an application for change of name
under Art. 376 of the Civil Code, the only name that
may be changed is the true or official name recorded
in the civil register. In addition, for a publication of
a petition for a change of name to be valid, the title
thereof should include, first, his real name, and
second, his aliases, if any (Jesus Ng Yao Siong v.
Republic, G.R. No. L-20306, March 31, 1966).
GROUNDS TO WARRANT A CHANGE
OF NAME
Jurisprudence has recognized certain justifying
grounds to warrant a change of name: (W-PACE)
1. The name is ridiculous, dishonorable or
extremely difficult to Write or Pronounce;
2. The change will Avoid confusion;
3. One has been continuously used and been
known since Childhood by a Filipino name,
unaware of alien parentage;
4. The surname causes Embarrassment and there
is no showing that the desired change of name
was for a fraudulent purpose or that the change
of name will prejudice public interest (Republic
v. Bolante, G.R. No. 160597, July 20, 2006).
GROUNDS FOR CHANGE OF FIRST
NAME OR NICKNAME UNDER RA 9048
1. Petitioner finds the first name or nickname to be
ridiculous, tainted with dishonor or extremely
difficult to write or pronounce;
2. The new name or nickname has been habitually
and continuously used by petitioner and he has
been publicly known by that first name or
nickname in the community;
3. The change will avoid confusion (R.A. 9048,
Sec. 4)
USURPATION OF A NAME
Usurpation of a name and surname may be the
subject of an action for damages and other relief
(CIVIL CODE, Art. 377). Consequently, the
unauthorized or unlawful use of another person's
surname gives a right of action to the latter (CIVIL
CODE, Art. 378).
ELEMENTS: (AUDI)
1. There is an Actual use of another’s name by the
defendant;
2. The use is Unauthorized; and
3. The use of another’s name is to Designate
personality or Identify a person (Tolentino v. CA,
G.R. No. L-41427, June 10, 1988).
GENERAL RULE: No person shall use different
names and surnames (CIVIL CODE, Art. 380).
EXCEPTION: Use of pen names or stage names is
permitted, provided it is done in good faith andthere
is no injury to third persons (CIVIL CODE, Art.379).
ABSENCE
(ARTS. 381-396)
The legal status of a person who has absented
himself from his domicile and whose whereabouts
and fate are unknown, it not being known with
certainty whether he is still living or not (JURADO,
supra at 260).
KINDS OF ABSENCE: (PD)
1. Provisional absence (CIVIL CODE, Art.
381)
– When a person disappears from his domicile,
his whereabouts being unknown, without
leaving an agent to administer his property.
a. There is no declaration of absence yet but
legal representative may be appointed only
when urgent representation is necessaryand
applies only if no agent has been appointed
to represent the absentee or agent’s
authority has expired (1 PARAS, supra at
874);
b. The spouse is preferred as the legal
representative except when they are legally
separated (CIVIL CODE, Art. 383, par. 1);
and
c. If absentee left no spouse, any competent
person any be appointed (CIVIL CODE, Art.
383, par. 2).
2. Declared absence (CIVIL CODE, Art. 384)
a. Without administrator - When a person
disappears from his domicile, and 2 years
have elapsed without any news about him, or
since the receipt of the last news.
b. With administrator – 5 years have elapsed
The following may ask for the declaration
ofabsence: (STIR)
i. Spouse present;
 ii. Testate heirs;
iii. Intestate heirs; and
iv. Other persons subordinated to Rights
over the property of absentee by death.
(CIVIL CODE, Art. 385)
The judicial declaration of absence shall nottake
effect until 6 months after its publication in a
newspaper of general circulation (CIVIL CODE,
Art. 386).
An administrator of the absentee’s property shall
be appointed by the court in accordance with
Art. 383 (CIVIL CODE, Art. 387).
NECESSITY OF JUDICIAL
APPOINTMENT
Appointment by the court is essential to capacitate
the wife to represent the absentee.Otherwise, she
cannot, for example, dispose ofconjugal property (1
PARAS, supra at 868).
If the wife is appointed as an administratrix, she
cannot alienate or encumber the husband’s property
or that of the conjugal property without judicial
authority (CIVIL CODE, Art. 388).
RIGHTS OF WIFE AS ADMINISTRATIX:
She must always obtain judicial permission or
authority in order that:
a. She can alienate or encumber
herhusband’s property.
b. She can alienate or encumber the conjugal
property (1 PARAS, supra at 876).
THE ADMINISTRATION SHALL CEASE
WHEN: (RPA)
1. Absentee Reappears personally or through an
agent;
2. Death is Proven and his testate/intestate heirs
appear; and
3. Third person appears and shows proof that he
Acquired absentee’s property when absentee
was still alive (CIVIL CODE, Art. 389).
PRESUMPTIVE DEATH
When the absentee is presumed dead (CIVIL
CODE, Arts. 390-391).
KINDS OF ABSENCE VIS-À-VIS
PRESUMPTION OF DEATH:
1. Ordinary
– it is when after an absence of 7 years, it being
unknown whether or not the absentee still lives
(CIVIL CODE, Art. 390).
2. Extraordinary or Qualified
– the following shall be presumed dead for all
purposes:
a. A person on board a vessel lost during a sea
voyage, or an aeroplane which is missing,
who has not been heard of for 4 years
since the loss of the vessel or aeroplane;
b. A person in the armed forces who has taken
part in war, and has been missing for 4
years;
c. A person who has been in danger of death
under other circumstances and his
existence has not been known for 4 years
(CIVIL CODE, Art. 391).
PRESUMPTION OF DEATH
(CIVIL CODE, ARTS. 390 TO 392)
Absence under Ordinary Circumstances
(Art. 390)
Presumed dead for all purposes
7
years EXCEPTION:
For purposes of opening succession
Presumed dead for purposes of opening
succession
10 EXCEPTION:
years If at the time of disappearance, the person
was already 75 years old, 5 years of
absence is sufficient for this presumption
to apply.
4 Presumed dead for purposes of
years remarriage of the spouse present (FAMILY
CODE, Art. 41)
Absence under Extraordinary Circumstances/
Qualified absence (Art. 391)
4 Presumed dead for all purposes
years includingopening of succession.
2 Presumed dead for purposes of
years remarriage (FAMILY CODE, Art. 41).
EFFECT OF APPEARANCE BY
ABSENTEE
If the absentee appears, or without appearing his
existence is proved, he shall recover his property in
the condition in which it may be found, and the price
of any property that may have been alienated or the
property acquired therewith; but he cannot claim
either fruits or rents (CIVIL CODE, Art. 392).
PRESUMPTION OF DEATH OF ABSENT
SPOUSE
A well-founded belief that the absentee is already
dead is required before an absent spouse may be
declared presumably dead. The requisites are: (4-
RBF)
1. The absent spouse has been missing for 4 years
or 2 consecutive years if the disappearance is
under extraordinary circumstances stated in Art.
91 of the Civil Code;
2. The present spouse wishes to Remarry;
3. The present spouse has a well-founded Belief
that the absent spouse is dead; and
4. The present spouse Files a summary
proceeding for the declaration of presumptive
death of the absent spouse (Republic v.
Nolasco, G.R. No. 94053, March 17, 1993).
NOTE: The legal requirement on the need for judicial
declaration of presumptive death does not apply to
a marriage celebrated under the (Old) Civil Code
as the law itself presumed as dead the spouse who
disappeared for a period of 7 years where the
present spouse has no news of the absentee being
alive, or for less than 7 years where the absentee
was generally presumed dead. Hence, proof of
“well-founded” belief is not required. Petitioner
could not have been expected to comply with this
requirement since the Family Code was not yet in
effect at the time of her marriage (Valdez v.
Republic, G.R. No. 180863, September 8, 2009).
Claims based on bare assertions, uncorroborated by
any kind of evidence, falls short of the diligence
required to engender a well-founded belief that the
absentee spouse is dead (Republic v. Catubag,G.R.
No. 210580, April 18, 2018).
WELL-FOUNDED BELIEF
The "well-founded belief" in the absentee's death
requires the present spouse to prove that his/her
belief was the result of diligent and reasonable
efforts to locate the absent spouse and that based
on these efforts and inquiries, he/she believes that
under the circumstances, the absent spouse is
already dead. It necessitates exertion of active
effort, not a passive one. As such, the mere absence
of the spouse for such periods prescribed under the
law, lack of any news that such absentee spouse is
still alive, failure to communicate, or general
presumption of absence under the Civil Code would
not suffice (Republic v. Tampus, G.R. No. 214243,
March 16, 2016).
GENERAL RULE: Any marriage contracted by a
person during the subsistence of a previousmarriage
shall be null and void (FAMILY CODE, Arts. 41 and
35 (4)).
EXCEPTIONS:
1. Before the celebration of the subsequent
marriage, the prior spouse had been absent for
four consecutive years and the spouse present
has a well-founded belief that the absent spouse
was already dead; or
2. In case of disappearance where there is danger
of death under the circumstances set forth inthe
provisions of Article 391 of the Civil Code, an
absence of only two years shall be sufficient
(FAMILY CODE, Art. 41).
NOTE: Article 41 of the Family Code only applies
when the petitioner seeks to remarry (Tadeo-Matias
v. Republic, G.R. No. 230751, April 25, 2018).
CIVIL REGISTRAR
(ARTS. 407-413)
Acts, events and judicial decrees concerning the civil
status of persons shall be recorded in the civil
register (CIVIL CODE, Art. 407). This includes:
(BMD-LAVLA2-NEC-JC)
1. Births;
2. Marriages;
3. Deaths;
4. Legal separations;
5. Judgments of Annulment of marriage;
6. Judgment declaring marriages Void from the
beginning;
7. Legitimations;
8. Adoptions;
9. Acknowledgments of natural children;
10. Naturalization;
11. Election, loss or recovery of citizenship;
12. Civil interdiction;
13. Judicial determination of filiation; and
14. Change of name (CIVIL CODE, Art. 408).
NOTE: These are entries subject to cancellation or
correction upon good and valid grounds (RULES OF
COURT, RULE 108, Sec. 2).
DUTY OF THE CLERK OF COURT
To ascertain whether the decree has been
registered, and if this has not been done, to send a
copy of said decree to the civil registry of the city or
municipality where the court is functioning (CIVIL
CODE, Art. 409).
NATURE OF THE BOOKS OF THE
CIVIL REGISTER AND RELATED
DOCUMENTS
1. Considered public documents; and
2. Prima facie evidence of the facts contained
therein (CIVIL CODE, Art. 410).
UNLAWFUL ALTERATION
GENERAL RULE: Every civil registrar shall be civilly
responsible for any unauthorized alteration made in
any civil register, to any person suffering damage
thereby (CIVIL CODE, Art. 411).
EXCEPTION: If the civil registrar proves that he has
taken every reasonable precaution to prevent the
unlawful alteration, he may exempt himself from
liability (CIVIL CODE, Art. 411).
FURTHERANCE OF AUTHORITY OF
THE CIVIL REGISTRAR TO CORRECT
CLERICAL AND TYPOGRAPHICAL
ERRORS UNDER R.A. NO. 10172
(An Act further Authorizing the City or Municipal Civil
Registrar or the Consul General to Correct Clerical
or Typographical Errors in the Day and Month in the
Date of Birth or Sex ofa Person Appearing in the
Civil Register without Need of a Judicial Order,
Amending For This Purpose Republic Act Numbered
Ninety Forty- Eight).
AUTHORITY TO CORRECT CLERICAL
OR TYPOGRAPHICAL ERROR AND
CHANGE OF FIRST NAME OR
NICKNAME
GENERAL RULE: No entry in a civil register shall
be changed or corrected without a judicial order
(CIVILCODE, Art. 412).
EXCEPTION: Administrative proceeding for clerical
or typographical errors and change of name or
nickname, the day and month in the date of birth or
sex of a person where it is patently clear that there
was a clerical or typographical error or mistake in the
entry (R.A. No. 10172, Sec. 1).
Clerical or Typographical Error
Refers to a mistake committed in the performance
of clerical work in writing, copying, transcribing or,
typing an entry in the civil register that is harmless
and innocuous, such as misspelled name or
misspelled place of birth, mistake in the entry of
day and month in the date of birth or sex of the
person or the like, which is visible to the eyes or
obvious to the understanding, and can be corrected
or changed only by reference to other existing record
or records (R.A. No. 10172, Sec. 2, par. 3).
EXCEPTIONS TO THE EXCEPTION: (ANS)
1. Age
2. Nationality
3. Status (R.A. No. 10172 Implementing Rulesand
Regulations, Rule 2.1).
NOTE: Correction or change can be made by the
concerned city or municipal civil registrar or consul
general in accordance with the provisions of this Act
and its implementing rules and regulations.
CHANGE OF NAME IS A PRIVILEGE
The State has an interest in the names borne by
individuals and entities for purposes of
identification. A change of name is a privilege, not a
right. Petitioner must show proper or reasonable
cause or any compelling reason which may justify
such change (Silverio v. Republic, G.R. No. 174689,
October 22, 2007).
A change of name is a privilege and not a matter of
right; a proper and reasonable cause must exist
before a person may be authorized to change his
name. "In granting or denying petitions for change
of name, the question of proper and reasonable
cause is left to the sound discretion of the court.
What is involved is not a mere matter of allowance
or disallowance of the request, but a judicious
evaluation of the sufficiency and propriety of the
justifications advanced in support thereof, mindful
of the consequent results in the event of its grant and
with the sole prerogative for making such
determination being lodged in the courts (Gan v.
Republic, G.R. No. 207147, September 14, 2016).
GROUNDS FOR CHANGES OF NAME:
(C2LEAR)
1. When the change will avoid Confusion;
2. Having Continuously used and been known
since childhood by a Filipino name, unaware of
her alien parentage;
3. When the change results as a Legal
consequence;
4. When the surname causes Embarrassment and
there is no showing that the desired change of
name was for a fraudulent purposeor that the
change of name would prejudice public interest;
5. A sincere desire to adopt a Filipino name to
erase signs of former Alienage, all in good faith
and without prejudicing anybody; and
6. When the name is Ridiculous, dishonorable or
extremely difficult to write or pronounce
(Republic v. CA G.R. No. 97906, May 21, 1992).
FIRST NAME
It refers to a name or nickname given to a person
which may consist of one or more names in addition
to the middle and last names (R.A. No. 9048, Sec.
2(6), as amended).

GROUNDS FOR CHANGE OF FIRST
NAME OR NICKNAME (R.A. NO. 9048):
(HAR)
1. New first name or nickname has been Habitually
and continuously used by the petitioner and he
has been publicly known by that first name or
nickname in the community;
2. The change will Avoid confusion; or
3. First name or nickname is Ridiculous, tainted
with dishonor or extremely difficult to write or
pronounce (R.A. No. 9048, Sec. 4, as
amended).
NOTE: R.A. 9048 (as amended by R.A. 10172) does
NOT sanction a change of first name on the ground
of sex reassignment. To rule otherwise may create
grave complications in the civil registry and public
interest (Silverio v. Republic, G.R. No. 174689,
October 22, 2007).
WHO MAY FILE A PETITION FOR THE
CORRECTION OF A CLERICAL OR
TYPOGRAPHICAL ERROR IN AN ENTRY
AND/OR CHANGE OF FIRST NAME OR
NICKNAME
Any person having direct and personal interest in the
correction of a clerical or typographical error in an
entry and/or change of first name or nickname in the
civil register may file, in person, a verified petition
with the local civil registry office of the city or
municipality where the record being sought to be
corrected or changed is kept (R.A. No. 9048, Sec.
3, par. 1, as amended).
NOTE: All petitions for the clerical or typographical
errors and/or change of first names or nicknames
may be availed of only once (R.A. No. 9048, Sec.
3, par. 5, as amended).
VENUE OF PETITION
1. Petitioner has already migrated to another
place in the Philippines
In case the petitioner has already migrated to
another place in the country and it would not be
practical for such party, in terms of
transportation expenses, time and effort to
appear in person before the local civil registrar
keeping the documents to be corrected or
changed, the petition may be filed, in person,
with the local civil registrar of the place where
the interested party is presently residing or
domiciled. The two (2) local civil registrars
concerned will then communicate to facilitate the
processing of the petition.
2. Petitioner is a citizen of the Philippines
presently residing in a foreign country
Citizens of the Philippines who are presently
residing or domiciled in foreign countries may
file their petition, in person, with the nearest
Philippine Consulates (R.A. No. 9048, Sec. 3,
pars. 2 and 3, as amended).
CHANGE OF MIDDLE NAME
Middle names serve to identify the maternal lineage
or filiation of a person, as well as further distinguish
him from others who may have the same given name
and surname as he has. Dropping the middle name
of a minor so that he will not be different from his
classmates in Singapore and on the additional
ground that it would cause confusion and difficulty
in its pronunciation in Singapore does not constitute
proper and reasonable cause to drop it from his
registered complete name. As he is of tender age,
he may not yet understand and appreciate the value
of the change of his name and granting of the same
at this point may just prejudice him in his rights under
our laws (In Re: Petition for Change of Name and/or
Correction/Cancellation of Entry in Civil Registry of
Julian Lin Carulasan Wang v. Cebu City Civil
Registrar, G.R. No. 159966, March 30, 2005).
Please refer to Remedial Law Memory Aid for a
comprehensive discussion of the procedural
aspects of change of name.
CANCELLATION OR CORRECTION OF
ENTRIES IN THE CIVIL REGISTRY
WHO MAY FILE: Any person interested in any act,
event, order or decree concerning the civil status of
persons which has been recorded in the civil
register, may file a verified petition for the
cancellation or correction of any entry relating
thereto, with the Court of First Instance (Regional
Trial Court) of the province where the corresponding
civil registry is located (RULES OF COURT, RULE
108, Sec 1).
The Civil Registrar and all persons who have or
claim any interest which would be affected thereby
shall be made parties to the proceeding (RULES OF
COURT, RULE 108, Sec. 3).
UPON THE FILING OF THE PETITION,
THE COURT SHALL: (FRO)
1. Fix the time and place for the hearing of the
same;
2. Cause Reasonable notice thereof to be given
to the persons named in the petition; and
3. Cause the Order to be published once a week
for 3 consecutive weeks in a newspaper of
general circulation in the province (RULES OF
COURT, RULE 108, Sec. 4).
OPPOSITION TO THE PETITION
Opposition may be filed by the civil registrar and any
person having or claiming any interest under the
entry whose cancellation or correction is sought
within 15 days from notice of the petition, or from the
last date of publication of such notice (RULES OF
COURT, RULE 108, Sec. 5).

ORDERS OF EXPEDITING
PROCEEDINGS
Orders expediting the proceedings and preliminary
injunction for the preservation of the rights of the
parties pending such proceedings may be granted
by the court (RULES OF COURT, RULE 108, Sec.
6).

DISMISSAL OF PETITION
After hearing, the court may either dismiss the
petition or issue an order granting the cancellation or
correction prayed for. In either case, a certified copy
of the judgment shall be served upon the civil
registrar concerned who shall annotate the same in
his record (RULES OF COURT, RULE 108, Sec. 7).
 CLASSIFICATION OF THINGS:
PROPERTY 1. Res Nullius
– “belonging to no one”

REASON: They have not yet been appropriated.

PROPERTY AS A SUBJECT
It is a branch of civil law which classifies and defines
the different kinds of appropriable objects, their
acquisition and loss, and in general, treats of the
nature and consequences of real rights (PARAS, Civil
Code of the Philippines Annotated Volume II, (2016),
p. 1 [hereinafter 2 PARAS]).
a. Res Derelictae – abandoned by the owner
with the intention of no longer owning them;
b. Ferae Naturae – free in their natural habitat
2. Res Communes
– “belonging to everyone”; their use and
enjoyment are given to all mankind.

PROPERTY NOTE: They are not capable of appropriation in

All things which are or may be the object of
appropriation (CIVIL CODE, Art. 414).
Under civil law, property comprehends every species
of title, inchoate or complete, legal or equitable
(China Banking Corporation v. CA, G.R. No. 129644,
March 7, 2000).
THING V. PROPERTY
their entirety as such although they may be
appropriated under certain conditions in a limited
way (Id. at 2).
3. Res Alicujus
– “belonging to someone”; objects, tangible or
intangible, which are owned privately, either in a
collective or individual capacity (2 PARAS, supra
at 2).

THING (COSA) PROPERTY (BIENES) REQUISITES/CLASSIFICATIONS OF

Any object which Anything which is PROPERTY: (USA)
exists and is capable already an object of 1. Utility
of satisfying human appropriation or found – capacity to satisfy some human want. This
needs, including those in the possession of utility, which is generally economic, endows
already possessed, man. It must be property with value susceptible of pecuniary
those susceptible of susceptible of estimation (DE LEON, Property, supra at 2);
appropriation, and appropriation.
common things which 2. Substantivity or individuality
are physically or – quality of having existence apart from any other
legally impossible to thing. Thus, parts of the human body such as
possess. hair, blood, and teeth cannot exist by themselves
(DE LEON, Comments and Cases on Property, independent of the body; they become property
(2015), p. 1 [hereinafter DE LEON, Property]). only when separated from the body of the person
to whom they belong (Id.); and
NOTE: Strictly speaking, “thing” is not synonymous 3. Appropriability
with “property”. However, the Civil Code uses these – susceptibility of being possessed by men (Id.).
terms interchangeably (Id.).

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA TAMPUS, Vice Chairperson
for Secretariat | ARVY KEITH CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice Chairperson for
Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. JOSEPH FERDINAND DECHAVEZ and Dean EDUARDO J.F. ABELLA

 CLASSIFICATION OF
PROPERTY
(ART. 414)
KINDS OF PROPERTIES:
1. Immovable or Real (CIVIL CODE, Art. 415);
2. Movable or Personal (CIVIL CODE, Arts. 416 and
417); and
3. Mixed or Semi-movables
a. Movables that are rendered immovable by
reason of being immobilized by destination or
through attachment to an immovable;
b. Immovables but are treated as movables
because they can be transplanted (e.g.,
plants) or dismantled and moved to another
place (e.g., house of light materials) without
impairing their substance; and
c. Animals in animal houses, pigeon houses,
etc. (CIVIL CODE, Art. 414, Par. 6) which are
classified as immovable though transferable
from place to place or they can move by
themselves (DE LEON, Property, supra at 9-
10).
OTHER CLASSIFICATIONS OF
PROPERTIES:
1. Ownership:
a. Public dominion; and
b. Private dominion (Id. at 6-7).
2. Alienability:
a. Within the commerce of man; and
b. Outside the commerce of man (Id.).
3. Existence:
a. Present or existing property (res existentes);
and
b. Future property (res futurae) (Id.).
4. Materiality or Immateriality:
a. Tangible or Corporeal (objects which can be
seen or touched); and
b. Intangible or Incorporeal (Id.).
NOTE: Rights or credits, like the credit
represented by P1,000 Bangko Sentral (2
PARAS, supra at 3).
NOTE: Philippine peso bills when attempted to
be exported may be deemed to have been taken
out of domestic circulation as legal tender and
may therefore be treated as a commodity.
Hence, bills carried in excess of that allowed by
the Bangko Sentral may be forfeited pursuant to
CB Circular No. 37 in relation to Sec. 1363 (f) of
the Revised Administrative Code (Commissioner
of Customs v. Capistrano, G.R. No. L-11075,
June 30, 1960).
5. Dependence or Importance:
a. Principal; and
b. Accessory (DE LEON, Property, supra at 6-
7).
6. Capability of Substitution:
a. Fungible; and
b. Non-fungible (Id.).
7. Definiteness or Nature:
a. Generic or Indeterminate – referring to a
group or class; and
b. Specific or Determinate – referring to a
single, unique object (Id.).
NOTE: Under the Law on Sales, a thing is
determinate or specific when it is particularly
designated or physically segregated from all
others of the same class (CIVIL CODE, Art.
1460).
8. Divisibility:
a. Divisible; and
b. Indivisible (DE LEON, Property, supra at 6-
7).
9. Consumability (Movables):
a. Consumable; and
b. Non-consumable (Id.).
10. Whether in the Custody of the Court or Free:
a. In custodia legis – those seized by an officer
under a writ of attachment or execution; and
b. “Free” property (Id.).
Importance of Classification:
The classification of property into immovables and
movables does not assume its importance from the
fact of mobility or non-mobility, but from the fact that
different provisions of the law govern the acquisition,
possession, disposition, loss, and registration of
immovables and movables (2 PARAS, supra at 5).
1. In Private International Law, the general rule is
that immovables are governed by the law of the
country in which they are located, whereas
movables are governed by the personal law of
the owner (DE LEON, Property, supra at 8).
2. Under the law on Donation, in order for a
donation of an immovable property to be valid, it
must be made in a public document (CIVIL
CODE, Art. 749). If the donated property is a
movable one, which value exceeds P5,000.00,
both the donation and the acceptance must be in
writing (CIVIL CODE, Art. 748).
3. In Criminal Law, usurpation of property can take
place only with respect to real property; while
robbery and theft can be committed only with
respect to personal property (DE LEON,
Property, supra at 8-9).
4. In Civil Procedure, actions concerning real
property are brought in the RTC where the
property or any part thereof lies, whereas
 personal property are brought in the court where
the defendant or any of its defendants reside or
may be found, or where the plaintiff or any of the
plaintiffs reside (Id.).
5. In Contracts, only real property can be the
subject matter of real mortgage and antichresis,
while only personal property can be the subject
matter of simple loan or mutuum, and voluntary
deposit and Personal Property Security Act (Id.).
NOTE: The laws on pledges and chattel
mortgage are repealed by RA 11057
otherwise known as the Personal Property
Security Act (hereinafter PPSA). Based on
Section 68 and 26 of the PPSA, the
implementation of this act shall be
conditioned upon the establishment and
operation of the Registry.
6. Under the law on Prescription, ownership of real
property may be acquired by prescription,with
just title and in good faith for at least ten (10)
years or without need of title or of good faith for
at least thirty (30) years (CIVIL CODE, Art. 1137),
whereas in case of personal property, the period
is four (4) years, if in good faith and eight (8)
years without need of any condition (CIVIL
CODE, Art. 1132).
7. In order to affect third persons, generally,
transactions involving real property must be
recorded in the Registry of Property (CIVIL
CODE, Art. 2140; DE LEON, Property, supra at
8-9). In any tangible asset, a security interest
may be perfected by registration or possession.
A security interest in investment property and
deposit account may be perfected by registration
or control. On perfection, a security interest
becomes effective against third persons (R.A.
No. 11057, Secs. 11 and 12).
NOTE: The human body, whether alive, or dead, is
neither real nor personal property, for it is not even
property at all, in that generally, it cannot be
appropriated although there is a right of possession
over it for burial purposes. Under certain conditions,
the body of a person or parts thereof may be the
subject matter of a transaction (2 PARAS, supra at
7).
NOTE:
1. R.A. 349: An Act to Legalize Permissions to
Use Human Organs or Any Portion or
Portions of the Human Body for Medical,
Surgical, or Scientific Purposes, Under
Certain Conditions (1949), as amended by
R.A. 1056
Under this law, a person may validly grant to a
licensed physician, surgeon, known scientist, or
any medical or scientific institution including eye
banks and other similar institutions, authority to
detach at any time after the grantor's death any
organ, part or parts of his body and to utilize the
same for medical, surgical, or scientific purposes.
Similar authority may also be granted for the
utilization for medical, surgical, or scientific
purposes, of any organ, part or parts of the body
which, for a legitimate reason, would be detached
from the body of the grantor (R.A.No.349, as
amended by R.A. 1056, Sec.1).
Requisites for the validity of the
authorization: (WSS)
a. It must be in Writing;
b. It must Specify:
1. The person or institution granted the
authorization;
2. The organ, part or parts to be
detached;
3. The use or uses of the organ, part or
parts to be employed; and
c. It must be Signed by the grantor and two
disinterested witnesses (R.A. No. 349, Sec.
2).
Under R.A. No. 349, consent to organ retrieval
after the patient’s death may be given, first and
foremost, by the patient’s nearest relative or
guardian at the time of death. It is only in the
event that these relatives cannot be contacted
despite reasonable efforts that the head of the
hospital or institution having custody of the body
may give consent for organ retrieval on behalf of
the patient. Failing this, liability for damages
arises (Alano v. Magud-Logmao, G.R. No.
175540, April 7, 2014).
2. R.A. No. 7170: Organ Donation Act of 1991
Donation by way of legacy:
Under this law, any individual, at least 18 years
of age and of sound mind, may give, by way of
legacy, to take effect after his death, all or part of
his body for medical or dental education,
research, advancement of medical or dental
science, therapy or transplantation, as the case
may be.
Persons who may execute a donation on
behalf of another: (S3PG)
Any of the following persons, in the order stated
hereunder, in the absence of actual notice of
contrary intentions by the decedent or actual
notice of opposition by a member of his or her
immediate family, may donate all or any part of
the decedent’s body:
a. Spouse;
b. Son or daughter of legal age;
c. Either Parent;
d. Brother or Sister of legal age; or
e. Guardian over the person of the decedent at
the time of his death (R.A. No. 7170, Sec.
4(a)).

NOTE: The persons authorized by subsection (a)
may make the donation after or immediately
before death (R.A. No. 7170, Sec. 4, Par. b).
Possible Donees:
a. Any hospital, physician or surgeon – for
medical or dental education, research,
advancement of medical or dental science,
therapy, or transplantation;
b. Any accredited medical or dental school,
college or university – for education,
research, advancement of medical or dental
science, or therapy;
c. Any organ bank storage facility – for medical
or dental education, research, therapy, or
transplantation; and
d. Any specified individual – for therapy or
transplantation needed by him (R.A. No.
7170, Sec. 6).
3. R.A. 7719: National Blood Services Act of
1994
This act promotes voluntary blood donation to
ensure adequate supply of human blood.
NOTE: R.A. 7719 or the National Blood Services
Act of 1994 is intended primarily to safeguard the
health of the people and has mandated several
measures to attain this objective. One of these is
the phase out of commercial blood banks in the
country. The law has sufficiently provided a
definite standard for the guidance of the
Secretary of Health in carrying out its provisions,
that is, the promotion of public health by providing
a safe and adequate supply of blood through
voluntary blood donation. By its provisions, it has
conferred the power and authority to the
Secretary of Health as to its execution, to be
exercised under and in pursuance of the law
(Beltran v. Secretary of Health, G.R. No. 133640,
November 25, 2005).
IMMOVABLE
PROPERTIES
(ART. 415)
CATEGORIES: (NIDA)
1. Real by Nature
– it cannot be carried from place to place (CIVIL
CODE, Art. 415(1-2 and 8));
2. Real by Incorporation
– attached to an immovable in a fixed manner to
be an integral part thereof (CIVIL CODE, Art.
415(1-4 and 6));
3. Real by Destination
– placed in an immovable for the utility it gives to
the activity carried thereon (CIVIL CODE, Art.
415(4-7 and 9)); and
4. Real by Analogy
– it is so classified by express provision of law (2
PARAS, supra, at 12; CIVIL CODE, Art. 415(10)).
TYPES OF IMMOVABLE PROPERTIES
(CIVIL CODE, Art. 415) (LaTAS-FAMine-
MacDoCo)
1. Land, buildings, roads and constructions
of all kinds adhered to the soil
a. Land is the best example of immovable
property: However, a shovelful of land is a
personal property since this no longer
adheres to the soil but when it is used to
cover a land, it becomes immovable again (2
PARAS, supra at 13).
b. Buildings are immovables by incorporation.
Their adherence to the land must be
permanent and substantial. They are more or
less of a permanent structure, substantially
adhering to the land, and not mere
superimpositions on the land like barong-
barongs or quonset fixtures, provided there
is intent of permanent annexation (Id.).
“Constructions of All Kinds” – the
attachment must be more or less permanent;
intent to attach permanently is important (2
PARAS, supra at 18).
It should be attached to the land in such a
way it cannot be separated therefrom without
breaking the material or deterioration of the
object (Meralco Securities Industrial Corp v.
CBAA, G.R. No. L-46245, May 31, 1982).
Where a building is sold to be demolished
immediately, it is to be regarded as movable
because the subject matter of the contract is
really the materials thereof (DE LEON,
Property, supra, at 55).
Principle of Accession - the building is
immovable property whether it is erected by
the owner, usufructuary, or lessee of the land
(Evangelista v. Alto Surety & Ins. Co., Inc.,
G.R. No. L-11139, April 23, 1958).
The building and the land on which it is
erected are separate immovable properties
(Lopez v. Orosa, G.R. No. L-10817-18,
February 28, 1958).
While it is true that generally, real estate
connotes the land and the building
constructed thereon, it is obvious that the
inclusion of the building, separate and
distinct from the land, in the enumeration of
what may constitute real properties could
mean only one thing — that a building is by
itself an immovable property (Lopez v.
Orosa, Jr., G.R. Nos. L-10817-18, February
28, 1958).
A building is an immovable property
irrespective of whether or not said structure
and the land on which it is adhered to belong
to the same owner. It cannot be divested of
its character of a realty by the fact that the
land on which it is constructed belongs to
another (Associated Insurance & Surety Co.
Inc. v. Iya, G.R. No. L-10837-38, May 30,
1958).
GENERAL RULE: The execution of a chattel
mortgage on a building is null and void,
notwithstanding registration in the Chattel
Mortgage Registry (Associated Insurance &
Surety Co. Inc. v. Iya, G.R. No. L-10837-38.
May 30, 1958).
EXCEPTION: A property may have a
character different from that imputed to it by
the law, i.e., the parties to a contract may, by
agreement, treat as personal property that
which, by nature, would be real property. The
view that parties to a deed of chattel
mortgage may agree to consider it as a
personal property is good only insofar as the
contracting parties are concerned. The same
is based on the principle of estoppel
(Evangelista v. Alto Surety Co. as cited in
Navarro v Pineda and Reyes, G.R. No. L-
18456, November 30, 1963). Hence, a house
may be the object of a chattel mortgage
contract, provided that:
i. The parties to the contract so agree; and
ii. No innocent third party will be prejudiced.
NOTE: The laws on pledges and chattel
mortgage are repealed by RA 11057
otherwise known as the Personal Property
Security Act (hereinafter PPSA). Based on
Section 68 and 26 of the PPSA, the
implementation of this act shall be
conditioned upon the establishment and
operation of the Registry.
On March 25, 2021, the LRA announced the
soft launching of the Philippines Personal
Property Security Registry (PPSR). For
clarity, the operationalization of the PPSR
with respect to User Account creation shall
not mean that the Registry has been fully
established and operational, as
contemplated in Sec. 55 item d of the PPSA,
nor does this mean that the PPSR is now fully
implemented as provided in Section 8.3 item
a (ii) and 10.03 of the PPSA IRR, (LRA
Circular 11-2021 Sec 5.2).
c. Roads, whether public or private, are
immovable. They are considered integral
parts of the land.
d. Constructions. Examples of constructions
are railroads. A wall or fence is to be
regarded as a construction by incorporation
as long as there is intent to attach it
permanently although it is merely made to
rest on the land (DE LEON, Property, supra
at 13).
2. Trees, plants, and growing fruits
They are immovable property on the theory that
they derive their existence or sustenance from
the soil (Id. at 19).
a. Trees
However, when trees are detached or
uprooted, incorporation ceases and they
become movables, except in the case of
uprooted timber if the land is a timberland.
This is because it is still an integral part of an
immovable property when it constitutes the
natural product of the latter (2 PARAS, supra
at 18).
b. Growing Crops
Inasmuch as the law makes no distinction,
growing crops whether on one’s land or on
another’s, as in the case of usufructuary, a
possessor or a tenant, should be considered
as real property (Id. at 19-20).
On the other hand, once they have been
severed they become personal property.
Sale of growing crops is sale of personal
property (3 MANRESA 22 as cited in
PARAS, supra at 19) because when the
crops are sold it is understood that they are
to be gathered (2 PARAS, supra at 19-20).
3. Everything Attached to an immovable in a
fixed manner
The attachment need not be made by the owner.
The same must be such that it cannot be
separated from the immovable without breaking
 the material or deterioration of the object. The d. There is an Intention of permanent
breakage or injury, in case of separation, must be annexation or attachment, even if adherence
substantial (Id. at 20). will not involve breakage or injury – this is the
main consideration (DE LEON, Property,
Article 415 paragraphs 1 and 3 provide that real supra at 21-22).
property may consist of constructions of all kinds
adhered to the soil and everything attached to an DISTINCTIONS BETWEEN PAR. 3 AND 4
immovable in a fixed manner, in such a way that OF ART. 415
it cannot be separated therefrom without
breaking the material or deterioration of the PARAGRAPH 3 PARAGRAPH 4
object. The pipeline system in question is
indubitably a construction adhering to the soil. It Cannot be separated Can be separated from
is attached to the land in such a way that it cannot from immovable without immovable without
be separated therefrom without dismantling the breaking or breaking or
steel pipes which were welded to form the deterioration deterioration.
pipeline (Meralco v. CBAA, G.R. No. L-46245,
Need not be placed by Must be placed by the
May 31, 1982).
the owner. owner or his agent.
Where the property like a water pump and its Real property by Real property by
accessories can be separated from the incorporation. incorporation and
immovable without being broken or suffering destination.
deterioration as when such removal involved
nothing more complicated than the loosening of (2 PARAS, supra at 20).
bolts or dismantling of fasteners, the said
property is not immovable under Art. 415(3) (Yap 5. Machinery, receptacles, instruments, or
v. Tanada, G.R. No. L-32917, July 18, 1988). implements for an industry or works

Both electric lines and communication cables, in
the strictest sense, are not directly adhered to the
soil but pass through posts, relays, or landing
stations, but both may be classified under the
term "machinery" as real property under Article
415(5) of the Civil Code for the simple reason that
such pieces of equipment serve the owner's
business or tend to meet the needs of his industry
or works that are on real estate (Capitol Wireless
v. The Provincial Treasurer of Batangas, G.R.
No. 180110, May 30, 2016).
Machinery is a collective term for machines and
appliances used in the industrial arts (DE LEON,
Property, supra at 23).
Equipment covers physical facilities available for
production, including buildings, machineries, and
tools (Id.).
Implements pertain to whatever may supply to
what is lacking especially an instrument, tool, or
utensil (Id.).

Intent Material Requisites: (OBM)

The fact that the machineries were bolted or
cemented on real property mortgaged does not
make them ipso facto immovable under Article
415 (3) and (5) as the parties’ intent has to be
looked into. Even if the properties appear to be
immovable by nature, nothing prohibits the
parties from treating them as chattels to secure
an obligation under the principle of estoppel (Tsai
v. CA, G.R. No. 120098, October 2, 2001).
a. It must be placed by the Owner of the
tenement or his agent (Davao Sawmill Co. v.
Castillo, G.R. No. 40411, August 7, 1935);
b. The industry or works must be carried on in
a Building or on a piece of land (CIVIL
CODE, Art. 415(5)); and
c. They tend directly to Meet the needs of the
said industry or works (CIVIL CODE, Art.
415(5)).

4. Statues, reliefs, paintings, or other Test of Essentiality

objects for use or ornamentation
Requisites: (OPOI)
a. It is an Object of ornamentation or object of
use;
b. The property is Placed on a building or land;
c. It must be placed by the Owner of the
immovable or by his agent (buildings or
lands); and
The machineries must be an essential and
principal element of the industry or works, without
which such industry or works would be unable to
function or carry on the industrial purpose for
which it was established, and not merely
incidental (Mindanao Bus Co. v. City Assessor
and Treasurer, G.R. No. L-17870, September 29,
1962).
The equipment and living quarters of the crew,
being permanently attached to the platform,
which is also an immovable, are immovables.
This is especially so if they are intended to meet
the needs of the business and industry of the
corporation (FELS Energy, Inc. v. Province of
Batangas, G.R. No. 168557, Feb 16, 2007).
A machinery, although movable in nature,
becomes immobilized when placed on a plant by
the owner of the property but not so when placed
by a tenant, usufructuary, or a person having only
a temporary right, unless:
a. Such person acted as an agent of the owner
of the land; or
b. In the case of a tenant and he had promised
to leave the machinery on the tenement at
the end of the lease (Davao Sawmill Co. v.
Castillo, G.R. No. 40411, August 7, 1935).
The special civil action of replevin is applicable
only to personal property. It cannot be filed when
the subject machinery and equipment had
become an immovable property (Machinery &
Engineering Supplies, Inc. v. CA, G.R. No. L-
7057, October 29, 1954).
Poles and steel supports or towers of an electric
company are not real property for purpose of real
property tax, since they are merely attached to a
square metal frame by means of bolts, which
could easily be dismantled and moved from place
to place (Board of Assessment Appeals v. Manila
Electric Company, G.R. No. L-15334, January
31, 1964).
Conflicting Views on the Effect of the
Temporary Separation of Movables from
Immovables to which they are attached:
a. They continue to be regarded as immovables
as long as they are utilized or still needed in
the industry (View supported by De Leon).
b. Fact of separation determines the condition
of the object (View supported by Paras and
Tolentino).
c. Things temporarily separated from the
immovable shall continue to be regarded as
immovables if there is intent to put them back
(Partidas).
d. The material fact of incorporation or
separation is what determines the condition
of these objects; so that as soon as they are
separated from the tenement, they recover
their condition as movables irrespective of
the intention of the owner (2 NAVARRO
AMANDI, supra at 14-15).
e. If the machine is still in the building, but is no
longer used in the industry, the machine
reverts to the condition of a chattel. On the
other hand, if still needed for the industry, but
separated from the tenement temporarily, the
property continues to be an immovable (2
PARAS, supra at 23).
6. Animal houses, pigeon houses,
beehives, fishponds or breeding places
of similar nature
Requisites: (PIO)
a. Forms a Permanent part of the immovable;
b. Placed or preserves them with the Intention
of permanent attachment; and
c. Placed by the Owner (CIVIL CODE, Art.
415(6)).
The animals in these places are included as real
property (DE LEON, Property, supra at 29).
In case of alienation, if the building or tenement
in which the animals are placed is also alienated,
they are to be regarded as immovable. However,
when the animals inside the permanent animal
houses are alienated onerously or gratuitously, it
is believed that the transaction is an alienation of
personal property (2 PARAS, supra at 27).
However, animals are to be regarded as personal
property for purposes of criminal law (DE LEON,
Property, supra at 29).
Animals which are temporarily outside may still
be considered real property, as long as the intent
to return is present, as in the case of homing
pigeons (2 PARAS, supra at 27).
7. Fertilizer
This is an immovable by destination (DE LEON,
Property, supra at 29-30).
The term “actually used” means that it has been
spread over the land (2 PARAS, supra at 28).
Fertilizers kept in a barn or still in their containers
should be regarded as movables (Id.).
8. Mines, quarries and slag dumps
They are considered as realty only if the matter
remains unsevered from the soil. Once severed,
they become personalty (DE LEON, Property,
supra at 30).
Mines – mineral lands where excavations are
done to extract minerals (include minerals when
still attached thereto) (Id.).
Quarries – lands where stones are chipped off
or where sand is being extracted; once extracted
they become movables (Id.).
 Slag dumps – dirt and soil taken from a mine and
piled upon the surface of the ground (Id.).
Waters – those still attached to or running
through the soil or ground (Id.).
Waters which are immovable, such as sea, river,
or lake must not be confused with “water” itself
which is plainly movable property (Id.).
9. Docks and Structures
Since “waters either running or stagnant” are
considered immovables, it is logical that
constructions united to them in a fixed and
permanent manner are also immovable (Id.).
Vessels are considered personal property under
civil law as well as under common law, although
occasionally referred to as a peculiar kind of
personal property (Phil. Refining Co., Inc. v.
Jarque, G.R. No. 41506, March 25, 1935).
Although vessels are personal property, they
partake to a certain extent of the nature and
conditions of real property because of their value
and importance in the world of commerce
(Rubiso v. Rivera, G.R. No. 15260, August 18,
1920).
Power barges are categorized as immovable
property by destination, being the nature of
machinery and other implements intended by
the owner for an industry or work which may be
carried on in a building or on a piece of land and
which tend directly to meet the needs of said
industry or work (Fels Energy, Inc v. Province of
Batangas, G.R. No. 168557, February 16,2007).
10. Contracts for Public works, and
servitudes and other real rights
Properties referred to in Art. 415(10) are not
material things but rights, which are necessarily
intangible (3 MANRESA 11 as cited in 2 PARAS,
supra at 30).
Where the res of a real right is real property, the
right itself is real property; but where it is personal
property, the right itself is personal property.
Hence, ownership is real property if the thing
owned is immovable and personal property if
movable (DE LEON, Property, supra at 32).
Hence, a real right over a real property is also a
real property and a real right over a personal
property is also a personal property.
A personal right is always regarded as personal
property. The exception is in the case of a
contract for public works which is considered real
property (Id.).
Pursuant to Section 1 of Act No. 4166, sugar
quotas, although not physically united to the land,
are considered immovable because they are
inseparable therefrom and are real rights over
immovable property (PINEDA, Law on Property,
(2009), p. 18 [hereinafter PINEDA, Law on
Property]).
As between the Civil Code, a general law
governing property and property relations, and
the Local Government Code, a special law
granting local government units (LGUs) the
power to impose real property tax, the latter
prevails for the purpose of determining which
property is subject to real property tax. In Manila
Electric Company vs City Assessor, it was ruled
that the transformers, electric posts, transmission
lines, insulators, and electric meters of
MERALCO may qualify as “machinery” under the
Local Government Code subject to real property
tax.
MOVABLE PROPERTIES
(ARTS. 416-418)
TESTS:
1. By description
a. Whether the property can be transported or
carried from place to place; and
b. Whether such change of location can be
made without injuring the immovable to
which the object may be attached (CIVIL
CODE, Art. 416).
2. By exclusion
– Whether the object does not fall within any of
the 10 cases enumerated in Art. 415 (2 PARAS,
supra at 34).
KINDS OF MOVABLE PROPERTIES:
(AP-F-TOS)
1. Those movables susceptible of Appropriation
which are not included in Art. 415 (CIVIL CODE,
Art. 416(1)).
2. Real property which by any special provision of
law is considered as Personalty (CIVIL CODE,
Art. 416(2)).
3. Forces of nature which are brought under control
by science (CIVIL CODE, Art. 416(3)).
Examples: electricity, gas, rays, heat, light,
oxygen, atomic energy, water power, etc.

It is true that electricity is no longer, as formerly
regarded by electricians as fluid, but its
manifestations and effects like those of gas, may
be seen and felt. The true test of what is a proper
subject of theft is not whether the subject is
corporeal or incorporeal but whether it is capable
of appropriation by another than the owner (U.S.
v. Carlos, G.R. No. 6295, September 1, 1911).
4. In general, all things which can be Transported
from place to place without impairment of the real
property to which they are fixed (CIVIL CODE,
Art. 416(4)).
5. Obligations and actions which have for their
object movables or demandable sums (CIVIL
CODE, Art. 417(1)).
An action to recover a personal property like a car
is personal property by itself. But the right to
recover possession of a piece of land is real
property.
Demandable Sums – amounts which are
liquidated and determined.
6. Shares of stocks of agricultural, commercial, and
industrial entities, although they may have real
estate (CIVIL CODE, Art. 417(2)).
The term “entities” includes all juridical persons
such as partnerships, although they do not issue
shares of stocks (DE LEON, Property, supra at
36).
Stock
Participation or interest in a business is a
personal property but interest in the real property
of a business entity is a real property (Id.).
CLASSIFICATION OF MOVABLES:
1. By Nature:
a. Consumable - cannot be used according to
its nature without it being consumed (CIVIL
CODE, Art. 418); and
b. Non-consumable - any other kind of
movable property (CIVIL CODE, Art. 418).
NOTE: The classification applies to
movables or to corporeal objects only.
2. By Intention:
a. Fungible - replaceable by an equal quality
and quantity, either by nature of things or
agreement; if it is agreed that the equivalent
thing be returned, it is fungible (2 PARAS,
supra at 39); and
b. Non-fungible – irreplaceable because
identical objects must be returned; if it is
agreed that the identical thing be returned, it
is non-fungible (Id.).
Illustration: Rice is, by nature, consumable
but if the parties intended it for display, it is
non-fungible because the identical rice need
to be returned. If it is loaned for consumption,
it is both consumable and fungible (DE
LEON, Property, supra at 37).
NOTE: The Civil Code, in many instances,
uses the terms consumable and fungible
interchangeably (2 PARAS, supra at 39).
PROPERTY IN RELATION
TO WHOM IT BELONGS
(ARTS. 419-425)
PROPERTY IS EITHER OF:
1. Public dominion
– owned by the state in its public or sovereign
capacity and intended for public use and not for
the use of the state as a juridical person (DE
LEON, Property, supra at 38); or
2. Private ownership
a. Property owned by the State and its political
subdivisions in their private capacity and is
known as patrimonial property (CIVIL CODE,
Arts. 421-424); or
b. Property belonging to private persons, either
individually or collectively (CIVIL CODE, Art.
425).
Property is presumed to be owned by the State in the
absence of any showing to the contrary (Salas v.
Jarencio, G.R. No. L- 29788, August 30, 1972). All
lands not appearing to be clearly private dominion is
presumed to belong to the State (Republic v. T.A.N.
Properties, Inc., G. R. No. 154953, June 26, 2008).
Accordingly, public lands not shown to have been
classified, reclassified, or released as alienable
agricultural land or alienated to a private person by
the State remain part of the inalienable lands of public
domain. Therefore, the onus to overturn, by
incontrovertible evidence, the presumption that the
land subject of an application for registration is
alienable and disposable rests with the applicant
(Republic v. Spouses Alejandre, G.R. No. 217336,
October 17, 2018).
This principle is rooted in the Regalian doctrine under
which the state is the source of any asserted right of
ownership of land (CONST., Art. XII, Sec. 2).
PROPERTY OF PUBLIC DOMINION
CONCEPT: It does not import the idea of ownership.
It is not owned by the State but simply under its
jurisdiction and administration for the collective
enjoyment of the people. The ownership of such
properties is in the social group, whether national,
provincial or municipal (DE LEON, Property, supra at
39).
PURPOSE: to serve the citizens for the common and
public welfare and not the State as a juridical person
(Id. at 80).
CHARACTERISTICS: (OI-PEAR)
1. Outside the commerce of man except insofar as
they may be the object of repair or improvement
or other similar things;
2. Inalienable, however, when it is no longer needed
for public use or service, it may be declared as
patrimonial property;
3. It cannot be acquired by Prescription;
4. It cannot be burdened with Easements;
5. It is not subject to Attachment or Execution; and
6. It cannot be Registered under the Property
Registration Decree or P.D. No. 1529, and be the
subject of a Torrens Title (Id. at 43-44).
If erroneously included in a Torrens Title, the land
involved remains property of public dominion. The
character of public property is not affected by
possession or even a Torrens Title in favor of private
persons (Palanca v. Commonwealth, G.R. No.
46373, Jan. 29, 1940).
As a property of public dominion, the Roppongi lot is
outside the commerce of man. The fact that it has not
been used for a long time does not automatically
convert it to a patrimonial property. The conversion
happens only if the abandonment is definite and upon
a formal declaration on the part of the government to
withdraw it from public use (Laurel v. Garcia, G.R. No.
92013, July 25, 1990).
WHO MAY DECLARE WITHDRAWAL
FROM PUBLIC USE
Only the Executive and possibly the Legislative
Departments have the authority and the power to
make the declaration that the lands so gained by
action of the sea is not necessary for purposes of
public utility or for the cause of establishment of
special industries or for coast guard services
(Natividad v. Director of Lands as cited in Monteverde
v. Director of Land, G.R. No. L- 4628, May 25, 1953).
Absent any expropriation proceeding and without any
evidence that the petitioner donated or sold the
subject property to the municipal government, the
same is still private property. A municipal ordinance
does not convert the same to public property
(Gatchalian v. Flores, G.R. No. 225176, January 19,
2018).
KINDS:
1. For Public Use
– may be used by anybody and not limited to
privileged individuals. It includes roads, canals,
rivers, torrents, ports, and bridges constructed by
the State, banks, shores, roadsteads, and others
of similar character
(DE LEON, Property, supra at 40-41).
Canals – artificial waterways designed for
navigation or for irrigating or draining land (Id. at
41).
Shores – portion of the land bordering the sea
and which is subject to the ebb and flow of the
waters (Id.).
Roadstead – a place less sheltered or enclosed
than a harbor (Id.).
Torrent – amount of water which in case of
heavy rain gathers in deep places or canals
where it is supposed to flow afterwards (Id.).
NOTE: The term “ports” includes seaports and
airports. The MIAA Airport Lands and Buildings
constitute a “port” constructed by the State.
Under Art. 420, the same are properties of public
dominion and thus owned by the State (MIAA v.
CA, G.R. No. 155650, July 20, 2006).
Examples of “and others of similar
character”:
a. Public streams, natural beds of rivers, river
channels and water of rivers, creeks, and
“esteros”;
b. Accretions to the shores of the sea by action
of the water;
c. Submerged lands and reclaimed lands;
NOTE: The mere reclamation of certain
foreshore land and submerged areas by a
government agency like the Public Estate
Authority does not convert these inalienable
natural resources of the State into alienable
or disposable lands of the public domain. In
the hands of the government agency tasked
and authorized to dispose of alienable and
disposable lands of public domain, these
lands are still public, not private lands. There
must be a law or presidential proclamation
officially classifying these reclaimed lands as
 alienable or disposable and open to
disposition or concession (Chavez v. Public
Estates Authority, G.R. No. 133250, May 6,
2003; Chavez v. National Housing Authority,
G.R. No. 164527, August 15, 2007).
d. Lands that disappeared into the sea by
natural erosion due to the ebb and flow of the
tide; and
e. Foreshore lands; when the sea moved
toward an estate and the tide invaded it, the
invaded property becomes foreshore land
and passes to the realm of the public domain,
and accordingly cannot be a subject of a free
patent (Republic v. CA, G.R. No. 100709,
November 14, 1997).
Foreshore Land - a strip of land that lies
between the high and low water marks and
that is alternatively wet and dry according to
the flow of the tide (DE LEON, Property,
supra at 42).
De Facto Case of Eminent Domain or
Natural Expropriation
It is the expropriation resulting from the
actions of nature as in a case where land
becomes part of the sea. The owner loses
his property in favor of the State without any
compensation (Republic v. CA, Morato, G.R.
No. 100709, November 14, 1997).
If a river is capable, in its natural state, of
being used for commerce, it is navigable in
fact and, therefore, becomes a public river
(Taleon v. Secretary of Public Works, G.R.
No. L-24281, May 16, 1967).
2. For Public Service
– may be used only by authorized persons.
All public buildings constructed by the State for
its offices and functionaries belong to this class
(Baguio Citizen’s Action v. City Council, G.R. No.
L-27247, April 20, 1983).
3. For the Development of National Wealth
GENERAL RULE: All natural resources belong
to the State and are not subject to alienation
(CONST., Art. XII, Sec. 2).
EXCEPTION: Public agricultural land
NOTE: Before public agricultural land is made
available for disposition they are property of
public domain for the development of national
wealth.
The charging of fees to the public does not
determine the character of the property, whether
it is of public dominion or not. Art. 420 defines
property of public dominion as one “intended for
public use”. Even if the government collects toll
fees, the road is still “intended for public use” if
anyone can use it under the same terms and
conditions as the rest of the public (MIAA v. CA,
G.R. No. 155650, July 20, 2006).
DISTINCTION BETWEEN GOVERNMENT
LANDS AND PUBLIC LANDS
The term “government lands” is broader in scope. It
includes lands devoted to public use or service, as
well as public lands before and after they are made
available for private appropriation and also
patrimonial lands. While “public land” is used to
describe much of the national domain under the
legislative power of Congress as has not been
subjected to private right or devoted to public use (DE
LEON, Property, supra at 45).
CONVERSION TO PATRIMONIAL
PROPERTY
There must be:
1. Abandonment or non-use
2. Affirmative act either on the part of the executive
or the legislative, to reclassify property of the
public dominion into patrimonial property.
NOTE: If, however, public land will be classified
as neither agricultural, forest or timber, mineral or
national park, or when public land is no longer
intended for public service or for the development
of the national wealth, thereby effectively
removing the land from the ambit of public
dominion, a declaration of such conversion must
be made in the form of a law duly enacted by
Congress or by a Presidential proclamation in
cases where the President is duly authorized by
law to that effect (Heirs of Malabanan vs
Republic, G.R. 179987, September 3, 2013).
Thus, until the Executive Department exercises
its prerogative to classify or reclassify lands, or
until Congress or the President declares that the
State no longer intends the land to be used for
public service or for the development of national
wealth, the Regalian Doctrine is applicable (Heirs
of Malabanan vs Republic, G.R. 179987,
September 3, 2013).
PROPERTY OF PRIVATE OWNERSHIP
Kinds:
1. Property owned by the State and its political
subdivisions in their private capacity and is
known as patrimonial property (CIVIL CODE,
Arts. 421-424); and
2. Property belonging to private persons, either
individually or collectively (CIVIL CODE, Art.
425).
PATRIMONIAL PROPERTY OF THE
STATE
1. Property of the State owned in a private or
proprietary capacity; and
2. Patrimonial Property
2. Property of public dominion, when no longer
intended for public use or for public service, shall
form part of the patrimonial property (CIVIL
CODE, Art. 422).
NOTE: Article 422 is not self-executing and
cannot be inferred from non-use alone. There
must be a formal declaration by the executive or
possibly the legislative department that the
property of the State is no longer needed for
public use or for public service before the same
can be classified as patrimonial or private
property of the State (Manila Lodge No. 761 v.
CA, G.R. No. L-41001, September 30, 1976).
In Heirs of Mario Malabanan vs Republic, the
Court held that patrimonial property of the State
may be acquired by prescription, citing Article
1113 of the Civil Code.
If the mode of acquisition is prescription, whether
ordinary or extraordinary, proof that the land has
been already converted to private ownership
prior to the requisite acquisitive prescriptive
period is a condition sine qua non in observance
of the law (CIVIL CODE, Art. 1113) that property
of the State not patrimonial in character shall not
be the object of prescription.
CHARACTERISTICS: (PD-SC)
1. Patrimonial properties may be acquired by
private individuals or corporations through
Prescription (CIVIL CODE, Art. 1113);
2. May be Disposed by the State;
3. It exists for the State to Support the attainment of
economic needs; and
4. It can be the object of ordinary Contract (DE
LEON, Property, supra at 46).
PROPERTY OF POLITICAL
SUBDIVISIONS
1. Property for Public Use
– consists of roads, streets, squares, fountains,
public waters, promenades, and public works for
public service paid for by the LGUs; they cannot
be alienated and acquired by prescription (Id. at
50).
NOTE: The enumeration in Art. 424 is not
exclusive.
Characteristics:
a. Outside the commerce of man;
b. Cannot be acquired by prescription;
c. Not subject to attachment and execution; and
d. Cannot be burdened by any voluntary
easement (RABUYA, Property, (2008), p. 88-
89 [hereinafter RABUYA, Property]).
– all other properties possessed by LGUs
including property for public service without
prejudice to provisions of special laws; they may
be alienated and acquired by others through
prescription. (2 PARAS, supra at 75).
NOTE: When a property is owned by a political
subdivision in its public and governmental
capacity, the Congress has absolute control. But
if the property is owned in its private or
proprietary capacity, it is patrimonial and
Congress has no absolute control. The
municipality cannot be deprived of it without due
process and payment of just compensation
(Rabuco v. Villegas, G.R. No. L-24661, February
28, 1974).
Art. 423 and 424 speak of property for public use,
indicating that property for public service is
patrimonial. However, the Supreme Court, in
Province of Zamboanga Del Norte v. City of
Zamboanga categorically stated that “the Court is
not inclined to hold that municipal property held
and devoted to public service is in the same
category as ordinary private property. The
classification of municipal property devoted for
distinctly governmental purposes as public,
under the Law of Municipal Corporations, should
prevail over the Civil Code in this particular case.”
The Law of Municipal Corporations was
considered as a special law in the context of Art.
424 of the Civil Code (Province of Zamboanga
Del Norte v. City of Zamboanga, G.R. No. L-
24440, March 28, 1968).
Properties of public dominion devoted to public
use are outside the commerce of men and cannot
be disposed of or leased by the LGU to private
persons. LGUs have no authority to control or
regulate the use of public properties, unless
specific authority is vested upon them by
Congress (Macasiano v. Diokno, G.R. No.
97764, August 10, 1992).
PROPERTY OF PRIVATE
OWNERSHIP
Collective ownership includes co-ownership and
ownership by corporations, partnerships, and
other juridical entities which are allowed under
the law to acquire and possess property of all
kinds (2 PARAS, supra at 76).
A possessory information inscribed in the
Registry of Property showing possession by
private persons and their predecessors since
time immemorial demonstrates prima facie that
 the possessors of the land to which it refers are
the owners thereof (Querubin v. Alconcel, G.R.
No. L-23050, September 18, 1975).
NOTE: Foreigners cannot acquire land in the
Philippines except in case of hereditary
succession (CONST., Art. XII, Sec. 7).
In case of unconstitutional purchase, foreigners
cannot make a claim for reimbursement of the
value of purchased parcels of Philippine land.
The Court cannot, even on the grounds of equity,
grant reimbursement to the foreigner given that
he acquired no right whatsoever over the subject
properties by virtue of its unconstitutional
purchase. It is well-established that equity as a
rule will follow the law and will not permit that to
be done indirectly which, because of public
policy, cannot be done directly (Beumer v.
Amores, G.R. No. 195670, December 3, 2012).
OWNERSHIP
(ARTS. 427-437)
It is the independent and general right of a person to
control a thing particularly in his possession,
enjoyment, disposition, and recovery, subject to no
restrictions, except those imposed by the State or
private persons, without prejudice to the provisions of
the law (2 PARAS, supra at 83).
Ownership and possession are two distinct legal
concepts (Garcia v. CA, G.R. No. 133140, August 10,
1999).
NOTE: Homeowners’ Association can own properties
termed as “Common Areas” under the "Magna Carta
for Homeowners and Homeowners’ Associations".
These properties include, but are not limited to,
roads, parks, playgrounds, and open spaces as
provided in Presidential Decree No. 1216. (R.A. No.
9904, Sec. 3(f)).
“OPEN SPACES,” DEFINED
Area reserved exclusively for parks, playgrounds,
recreational uses, schools, roads, places of worship,
hospitals, health centers, barangay centers and other
similar facilities and amenities (P.D. No. 1216, Sec.
1).
KINDS OF OWNERSHIP:
1. Full ownership (dominium or jus in re
propria)
– includes all the rights of an owner;
2. Naked ownership (nuda proprietas)
– the bare title to property; where the right to the
use and fruits has been denied;
3. Beneficial ownership/Usufruct
– right to enjoy the use and fruits of a property;
where the legal title is vested in another;
NOTE: Naked ownership
+ Beneficial ownership
= Full ownership
4. Sole Ownership
– one where the ownership is vested in only one
person; and
5. Co-ownership
– when the ownership is vested in two or more
persons (DE LEON, Property, supra at 76).
SUBJECT MATTER
Ownership may be exercised over a:
1. Thing
- Usually refers to a corporeal property; or
2. Right
– Whether real or personal, usually refers to an
incorporeal property (CIVIL CODE, Art. 427).
RIGHT AS PROPERTY:
1. A real right or jus in re
– is the right or interest belonging to a person
over a specific thing without a definite passive
subject against whom such right may be
personally enforced (DE LEON, Property, supra
at 3).
Classification of Real Rights Based on
Dominion:
a. Domino pleno – the powers to enjoy and to
dispose are united (e.g., dominion; civil
possession; and hereditary right);
b. Domino menos pleno – the powers to enjoy
and to dispose are separated (e.g., surface
right; and usufruct); and
c. Domino limitado – the powers to enjoy and to
dispose, though united, are limited by a charge
(e.g. easement, tax), by a guaranty (e.g.
mortgage, pledge), or by a privilege (e.g. pre-
emption, redemption, lease record) (Id. at 4).
2. A personal right or jus in personam or jus
ad rem or right of obligation
– is the right or power of a person (creditor or
obligee) to demand from another (debtor or
obligor) as a definite passive subject, the
fulfillment of the latter’s obligation (Id. at 5).
REAL RIGHTS V. PERSONAL RIGHTS PERSONAL
REAL RIGHTS
PERSONAL RIGHTS
REAL RIGHTS
RIGHTS
to real actions (action in against a particular
As to the Number of Persons Who Take Part rem) against third person (the
in the Legal Relation persons. debtor), giving rise
to personal actions
There is a definite active There is a definite (action in
subject who has a right active subject personam) against
against all persons (creditor) and a such debtor.
generally as an indefinite definite passive (Id. at 5-6).
passive subject. subject (debtor).

As to the Subject Matter MODES OF ACQUIRING OWNERSHIP

The object is generally a
corporeal thing (objects
which can be seen or
touched).
As to the Manner in Which the Will of the
Active Subject Acts
He generally acts
directly.
As to the Causes of Their Creation
Created by concurrence
of a title and a mode of
acquisition
Note: Mode is the
specific cause which
produces dominion and
other real rights as a
result of the co-existence
of special status of
things, capacity, x x x
intention of person and
[the] fulfillment of the
requisites of law
(Spouses Stilianopoulos
v. Register of Deeds for
Legazpi City, G.R. No.
224678, July 3, 2018).
As to Mode of Their Extinction
1. Original Modes
It is always an a. Occupation
incorporeal thing. b. Work which includes Intellectual creation
2. Derivative Modes
a. Law
b. Tradition
c. Donation
d. Prescription
e. Succession (DE LEON, Property supra at
He acts indirectly
580).
through the
promise of the
NOTE: Original modes of acquiring ownership
obligor.
pertains to those independent of any pre-existing
right of another person while derivative modes are
those based on pre-existing right held by another
Created merely by person. Moreover, derivative modes are modes both
“title” for the acquisition and for transmission of ownership
and other real rights (Id. at 591).
Note: Title is the
juridical right which SEVEN ATTRIBUTES OF OWNERSHIP
gives a means to (PUF-A2-DV):
the acquisition of
1. Jus Possidendi
[such] rights
– The right to possess; it is different from
(Spouses
ownership (judgment of ownership does not
Stilianopoulos v.
include the right to possess except when claim of
Register of Deeds
possession is based upon the claim of
for Legazpi City,
ownership) (Id. at 80);
G.R. No. 224678,
July 3, 2018).
2. Jus Utendi
– The right to use and enjoy; it may also include
the right to exclude any person from enjoyment
and disposal of the thing (relate to CIVIL CODE,
Arts. 429 and 431);

Generally, it is Personal right 3. Jus Fruendi

extinguished by the loss survives the – The right to enjoy the fruits (natural, industrial,
or destruction of the thing subject matter. and civil); possessor in good faith (CIVIL CODE,
over which it is Art. 544), usufructuary (CIVIL CODE, Art. 566),
exercised. lessee of agricultural land (CIVIL CODE, Art.
1676), and antichretic creditor (CIVIL CODE, Art.
As to the Nature of the Actions Arising from 432) are entitled to the fruits even if they are not
the Juridical Relation the owner;
It is directed against the It is binding or
whole world, giving rise enforceable only
4. Jus Accessionis acquire real property needed as right-of-way site
– The right to accessories; the general rule is that or location for any national government
all accessions and accessories are included in infrastructure project through donation,
the obligation to deliver a determinate thing negotiated sale, expropriation, or any other mode
although they may not have been mentioned of acquisition as provided by law (R.A. No.
(CIVIL CODE, Art. 1166); 10752, Sec. 4).

5. Jus Abutendi 2. Limitations imposed by the Owner himself;

– The right to abuse (or even destroy) or to
consume a thing by its use, subject to the 3. Specific limitations imposed by law
provisions of law (e.g. disposition of wealth to the – e.g. legal easement and non-impairment of
prejudice of others); legitime in succession;

6. Jus Disponendi 4. Inherent limitations arising from conflict with

– includes the following rights (DATE-Not): other rights such as those which take place in
a. To Destroy; accession continua; and
b. To Alienate;
c. To Transform; 5. Limitations imposed by the Party transmitting the
d. To Encumber; and property either by contract or by will (2
e. Not to dispose. TOLENTINO, supra at 59).

7. Jus Vindicandi
– right of action against the holder and possessor
of the thing or right in order to recover it (DE
LEON, Property, supra at 84).

CHARACTERISTICS: (EG-PIE)
1. Elastic
– power/s may be reduced and thereafter
automatically recovered upon the cessation of
the limiting rights;

2. General
– the right to make use of all the possibilities or
utility of the thing owned, except those attached
to other real rights existing thereon;

3. Perpetual
– ownership lasts as long as the thing exists. It
cannot be extinguished by non-use but only by
adverse possession;
4. Independent
– it exists without necessity of any other right;

5. Exclusive
– there can only be one ownership over a thing
at a time; there may be two or more owners but
only one ownership) (2 TOLENTINO, Civil Code
of the Philippines, Volume II, (1992), p. 59
[hereinafter 2 TOLENTINO]).

LIMITATIONS: (GOSIP)
1. General limitations imposed by the State for its
benefit
– power of taxation, police power, and power of
eminent domain;

NOTE: Under R.A. No. 10752, otherwise known

as “The Right-of-Way Act”, the government may
 LEGAL REMEDIES TO RECOVER POSSESSION OF
PROPERTY

REMEDIES NATURE ISSUE JURISDICTION PRESCRIPTION

Personal Property

Replevin A remedy for the recovery of Physical RTC or MTC Four (4) years (if
possession of personal Possession possession in good
property which is governed If the value of the faith) from the time
by Rule 60 of the Rules of personal property the possession
Court. does not exceed thereof was lost
1. As a form of principal P300,000.00 (or
remedy – to regain P400,000.00 in Metro Eight (8) years
possession Manila) – MTC (without other
2. As a form of provisional conditions) (CIVIL
remedy – to retain what If the value of the CODE, Art. 1132)
has been wrongfully personal property from the time the
detained pendente lite. exceeds P300,000.00 possession thereof
(or P400,000.00 in was lost
Replevin will not lie for Metro Manila) – RTC
property in custodia legis
(Chua v. CA, G.R. No.
79021, May 17, 1993).
Real Property

1. Accion A summary action to

Interdictal recover physical or material
(Ejectment possession of property
Suit)
a. Forcible An action for recovery of Possession MTC, irrespective of One (1) year from the
Entry material possession de facto the amount of date of actual entry on
(detentacion) (possession de facto) of real damages or unpaid the land when entry
property when a person rentals sought to be was made through
originally in possession was recovered force, intimidation,
deprived thereof by Force, strategy, or threat
Intimidation, Strategy,
Threat, or Stealth (FISTS). One (1) year from
discovery when entry
Reason: Irrespective of the was made through
actual condition of the title to stealth
the property, the party in
peaceable quiet possession
shall not be turned out by
strong hand, violence, or
terror (Javier v. Veridiano,
G.R. No. L-48050, October
10, 1994).

Actual possessors who can

prove prior possession can
recover such possession
even against the owner
himself. Whatever may be
REMEDIES NATURE ISSUE JURISDICTION PRESCRIPTION
the character of such
possession, if he has in his
favor priority in time, he has
the security that entitles him
to remain on the property
until he is lawfully ejected by
a person having a better
right by accion publiciana or
accion reinvindicatoria
(German Management &
Services v. CA, G.R. No. L-
76216, September 14,
1989).
b. Unlawful An action for recovery of Possession MTC One (1) year from the
detainer possession of any real de facto date of last demand to
(desahuico) property by a landlord, vacate
vendor, vendee, or other
person, against whom the If there is a fixed
possession of the same was period for termination
unlawfully withheld, after the of the lease, lease
expiration or termination of ends automatically
the right to hold possession. without need of
demand, one year
A requisite for a valid cause period is reckoned
of action in an unlawful from the expiration of
detainer case is that the lease (2 PARAS,
possession must be supra at 109).
originally lawful, and such
possession must have If the reason for
turned unlawful only upon ejectment is non-
the expiration of the right to payment of rent or
possess (Eversley Childs non-fulfillment of the
Sanitarium v. Spouses conditions of the
Perlabarbarona, G.R. No. lease, one year period
195814, April 4, 2018). is reckoned from the
Without proof that the date of demand to
possession was legal at the vacate (Id.).
outset, the action for
unlawful detainer shall be
dismissed (Javelosa v.
Tapus, G.R. No. 204361,
July 4, 2018).

A person or squatter, who

occupies the land of another
at the latter’s tolerance or
permission, without any
contract between them, is
necessarily bound by an
implied promise that he will
vacate upon demand; failing
which, a summary action for
ejectment or unlawful
detainer is the proper
remedy against him (Yu v.
de Lara, G.R. No. L-16084,
November 30, 1962).
 REMEDIES NATURE ISSUE JURISDICTION PRESCRIPTION

NOTE: An action for

unlawful detainer is
summary in nature and the
only issue that needs to be
resolved is who is entitled to
physical possession of the
premises, possession
referring to possession de
facto, and not possession de
jure. Nonetheless, where the
parties to an ejectment case
raise the issue of ownership
and such is inseparably
linked to that of possession,
the courts may pass upon
that issue to determine who
between the parties has the
better right to possess the
property. The adjudication of
the ownership issue,
however, is not final and
binding. The same is only for
the purpose of resolving the
issue of possession
(Baleares, Baleares v.
Espanto, G.R. No. 229645,
June 6, 2018).

It does not even matter if a

party's title to the property is
questionable. Where the
parties to an ejectment case
raise the issue of ownership,
the courts may pass upon
that issue to determine who
between the parties has the
better right to possess the
property (Spouses Santiago
v. Northbay Knitting Inc.
(NKI), G.R. No. 217296,
October 11, 2017).
2. Accion An ordinary civil proceeding Possession RTC or MTC Ten (10) years from
Publiciana to recover possession of real de Jure the time the cause of
property when the If the assessed value action arose
dispossession was of the real property
committed: does not exceed
1. Where the entry was not P20,000.00 (or
obtained through FISTS P50,000.00 in Metro
or failure to state that Manila) – MTC
deprivation was caused
by FISTS. This can be If the assessed value
brought as soon as the of the real property
dispossession takes exceeds P20,000.00
place, without waiting for (or P50,000.00 in
the lapse of the one (1) Metro Manila) – RTC
year period (Gutierrez v.
 REMEDIES NATURE ISSUE JURISDICTION PRESCRIPTION
Rosario, G.R. No. 4145, NOTE: Jurisdiction is
January 28, 1910; determined not only
Gumiran v. Gumiran, by the type of action
G.R. No. 6364, January filed but also by the
11, 1912); or assessed value of the
2. Where the one-year property. In accion
period for bringing publiciana and
forcible entry or unlawful reinvindiatoria, the
detainer has already assessed value of the
expired. real property is a
jurisdictional element
to determine the court
that could take
cognizance of the
action. In the absence
of any allegation in the
Complaint of the
assessed value of the
subject properties, it
cannot be determined
which court has
exclusive original
jurisdiction over
respondents’
complaint (Regalado
v. De La Peña, G.R.
No. 2012448;
December 13, 2017).
3. Accion An action to recover real Ownership RTC or MTC Four (4) years if
Reinvindica- property based on If the assessed value based on fraud from
toria ownership. of the real property the issuance of
does not exceed certificate of title over
P20,000.00 (or the property
P50,000.00 in Metro
Manila) – MTC Ten (10) years if
based on implied or
If the assessed value constructive trust
of the real property
exceeds P20,000.00 Imprescriptible
(or P50,000.00 in when plaintiff is in
Metro Manila) – RTC possession of the
property.
NOTE: Under RA
11576 (Effective on
August 20, 2021), the
jurisdiction of METC,
MTC, MCTC, MTCC
will be further
expanded. The RTC
shall exercise
exclusive jurisdiction
in all civil actions
involving the title to, or
possession of, real
property valued at
P400,000, from the
 REMEDIES NATURE ISSUE JURISDICTION PRESCRIPTION
previous P20,000 to
P50,000.

ANCILLARY REMEDIES

REMEDIES NATURE JURISDICTION PRESCRIPTION

1. Writ of Writ of execution commanding Court where the Imprescriptible

Possession the sheriff to enter into the land case is pending
and give the possession thereof
to the entitled person

2. Writ of Injunction requiring the Court where the 10 days from filing in case of
Preliminary defendant to do or refrain from case of unlawful forcible entry
Injunction doing a particular thing detainer or forcible
entry is pending. 10 days from the time the appeal
is perfected in case of unlawful
detainer
(DE LEON, Property, supra at 84-98)
 FORCIBLE ENTRY V. thing in order to recover it.” Moreover “every
UNLAWFUL DETAINER possessor has a right to be respected in his
possession, and should he be disturbed therein,
UNLAWFUL he shall be protected in or restored to said
FORCIBLE ENTRY
DETAINER possession by the means established by the laws
and the Rules of Court.” (CIVIL CODE, Art. 539,
As to When Possession Became Unlawful Par. 1; 2 PARAS, supra at 89).
Possession of the Possession is
defendant is unlawful inceptively lawful, but 2. Right to Enjoy; and
from the beginning as becomes illegal from The right to enjoy includes:
he acquires possession the time the defendant a. The right to possess;
by Force, Intimidation, unlawfully withholds b. The right to use; and
Strategy, Threat or possession, after the c. The right to the fruits (Id. at 89).
Stealth (FISTS). expiration or
termination of his right 3. Right to Dispose
thereto. The right to dispose includes:
a. The right to consume, destroy, or abuse; and
As to the Necessity of Demand b. The right to encumber or alienate (Id.)

No previous demand for Demand is PRINCIPLE OF SELF-HELP UNDER

the defendant to vacate jurisdictional.
ARTICLE 429
is necessary.
EXCEPTION: if there is The owner or lawful possessor of a thing has the right
a fixed period for the to exclude any person from the enjoyment and
termination of the lease, disposal thereof. For this purpose, he may use such
demand is unnecessary force as may be reasonably necessary to repel or
(2 PARAS, supra at prevent an actual or threatened unlawful physical
109). invasion or usurpation of his property (CIVIL CODE,
Art. 429).
As to Necessity of Proof of Prior Physical
Possession Requisites: (ROAD)
1. Reasonable force;
Plaintiff must prove that Plaintiff need not have 2. Owner or lawful possessor is the person who will
he was in prior physical been in prior physical exercise;
possession of the possession. 3. Actual or threatened physical invasion or
premises until he was usurpation; and
deprived thereof by the 4. No Delay in one’s exercise (i.e., at the time of an
defendant. actual or threatened dispossession, or
immediately after the dispossession). Once delay
As to When the One (1) Year Period is has taken place, even if excusable, the owner or
Counted lawful possessor must resort to judicial process
for the recovery of the property (CIVIL CODE,
From the date of actual From the date of last
Arts. 433 and 536; DE LEON, Property, supra at
entry on the land when demand or last letter of 105).
entry was made through demand
force, intimidation, GENERAL RULE: A person cannot interfere with the
strategy, or threat In case of a lease with a right of ownership of another (DE LEON, Property,
fixed period, the one- supra at 112).
From discovery when year period is reckoned
entry was made through from the expiration of EXCEPTION: Doctrine of Incomplete Privilege or
stealth the lease. State of Necessity (CIVIL CODE, Art. 432).
(RULES OF COURT, Rule 70).
NOTE: Art. 11 of the Revised Penal Code on self-
RIGHTS OF AN OWNER UNDER ARTICLE defense includes not only defense to a man’s person,
428: (RED) but also that of his rights to property.
1. Right to Recover or vindicate; Acts in a state of necessity are different from defense
The right to recover is given expressly in Art. 428 against unlawful aggression or defense against
which provides that “the owner has also a right of dangerous objects, although the principle which
action against the holder and possessor of the
justifies them is the same. If the danger comes from
another’s property, and the force is employed against
it, the case is one of defense against danger. But if
another’s property is used to avert danger not arising
from it, the act is essentially one in a state of
necessity; in other words, it is for the purpose or
protecting the actor himself or another person at the
expense of the owner of the property who has no part
in the state of necessity (2 TOLENTINO, supra at 68).
The actual invasion of property may consist of:
1. Mere disturbance of possession; or
2. Real dispossession (Id.).
The rules are:
a. If it is mere disturbance of possession, force may
be used against it at any time as long as it
continues, even beyond the prescriptive period
for an action of forcible entry (e.g. if a ditch is
opened by P in the land of J, the latter may close
it or cover it by force at any time) (Id. at 54).
b. If it consists of a real dispossession, force to
regain possession can only be used
immediately after the dispossession (e.g. if J,
without P’s permission, picks up a book
belonging to the latter and runs off with it, P can
pursue J and recover the book by force) (Id.).
3. There should be no delay in the use of force to
recover it; a delay, even if excusable, such as
when due to the ignorance of the dispossession,
will bar the right to the use of force. Once the
usurper’s possession has become firm by the
lapse of time, the lawful possessor must resort to
the competent authority to recover his property
(Id.).
Where a tenant is given a certain period to
vacate, the act of the owner in dragging the
tenant away is not justified under Art. 429. During
said period, the tenant is considered a lawful
possessor (Caisip v. People, G.R. No. L-28716,
November 18, 1970).
However, in another criminal case, wherein a
private corporation sought to take over a land by
fencing the same without authority or court order,
the Court sustained the use of force under Art.
429. In said case, the owner of the land fought off
and prevented the workers from constructing the
fence. The Supreme Court acquitted the owner
holding that the use of such necessary force to
protect proprietary or possessory rights
constitutes a justifying circumstance under the
penal laws (People v. Pletcha, G.R. No. 19029,
June 27, 1977).
RIGHT TO ENCLOSE OR FENCE
Every owner may enclose or fence his land or
tenements by means of walls, ditches, live or dead
hedges, or by any other means without detriment to
servitudes constituted thereon (CIVIL CODE, Art.
430).
Every owner has an absolute right over his property
and his act of fencing and enclosing the same was an
act which he may lawfully perform in the exercise of
said right. Thus, damages arising from the act of the
owner in building a fence within the latter’s lot is
considered damnum absque injuria, since it is the
owner’s legal right to do so (Custodio v. CA, G.R. No.
116100, February 9, 1996).
OBLIGATION TO RESPECT THE RIGHTS
OF OTHERS
The owner of a thing cannot make use thereof in such
manner as to injure the rights of a third person (sic
utere tuo ut alienum non laedas) (CIVIL CODE, Art.
431).
Adjoining landowners have mutual and reciprocal
duties which require that each must use his own land
in a reasonable manner, so as not to infringe upon
the rights and interests of others. The structures must
be so constructed and maintained using all
reasonable care so that they cannot be dangerous to
adjoining landowners and can withstand the usual
and expected forces of nature. If the structures cause
injury or damage to an adjoining landowner or a third
person, the latter can claim indemnification for the
injury or damage suffered (Andamo v. IAC, G.R. No.
74761, November 6, 1990).
An owner cannot be debarred from the legitimate use
of his property simply because it may cause real
damage to his neighbor (Higgins Oil & Fuel Co. v.
Guaranty Oil Co., 145 la 233, 82 So. 206, as cited in
2 TOLENTINO, supra at 67).
DOCTRINE OF INCOMPLETE PRIVILEGE
OR STATE OF NECESSITY
The owner of a thing has no right to prohibit the
interference of another with the same, if the
interference is necessary to avert an imminent
danger and the threatened damage, compared to the
damage arising to the owner from the interference, is
much greater (CIVIL CODE, Art. 432).
It authorizes the destruction of a property which is
lesser in value to avert the danger poised to another
property, the value of which is much greater (2
PARAS, supra at 150-151).
BASIS: There is no unlawful aggression when a
person or group of person acts pursuant to the right
given in a state of necessity (DE LEON, Property,
supra at 105).
Art. 432 is based on what is known as the state of
necessity, a justifying circumstance recognized in the
Revised Penal Code (Art. 11) but which does not also
exempt the offender from civil liability. It likewise
embodies the principle of “the least evil” rule, i.e., that
as between two evils, one is justified in choosing the
lesser evil (Id.).
NOTE: It is also for the purpose of protecting the
actor himself or another person at the expense of the
owner of the property who has no part in the state of
necessity (Id.).
The owner of the sacrificial property is obliged to
tolerate the act of destruction but is entitled to
reimbursement by all those who benefited through
the act or event (CIVIL CODE, Art. 432).
Basis of Reimbursement: the benefit derived from
the act.
Requisites: (ID)
1. Interference necessary to avert an imminent and
threatened danger to the actor or a third person;
and
2. Damage to another is much greater than damage
to property (DE LEON, Property, supra at 109).
Illustrations: The attacking animal, belonging to
another, may be killed by the victim; a house in the
path of a fire may be demolished; and a dike may be
destroyed at one point to prevent a flood over other
places (2 TOLENTINO, supra at 68).
DOCTRINE OF SELF-HELP VS. STATE
OF NECESSITY
The doctrine of self-help is invoked by the owner or
lawful possessor in protection of his right to prevent
other persons from interfering with his property. The
state of necessity, on the other hand, is availed of by
another person against someone else’s property for
the purpose of averting an imminent danger to
himself or to another person or to their property
(RABUYA, Property, supra at 134).
DISPUTABLE PRESUMPTION OF
OWNERSHIP
Actual possession under claim of ownership raises a
disputable presumption of ownership. The true owner
must resort to judicial process for the recovery of the
property (CIVIL CODE, Art. 433).
ACTIONS TO RECOVER
In an action to recover, the property must be
identified, and the plaintiff must rely on the strength
of his title and not on the weakness of the defendant's
claim (CIVIL CODE, Art. 434). The person who claims
that he has better right to the property must
satisfactorily prove both ownership and identity of the
same (Pang-oden v. Leonen, G.R. No. 138939,
December 6, 2006).
REQUISITES: (IT)
1. Proof of Identity of the Property
He must fix the identity of the land claimed by
describing the location, area, and boundaries
thereof.
Failure to prove the boundaries of the land – the
action to recover will necessarily fail (Santiago v.
Santos, G.R. No. L-20241, November 22, 1974).
2. Proof of Title
In an action to recover, the plaintiff must rely on
the strength of his title and not on the weakness
of the defendant’s claim (CIVIL CODE, Art. 434).
In order to successfully maintain actions for
recovery of ownership of a real property, the
complainants must prove the identity of the land
and their title thereto as provided under Article
434 of the Civil Code. They have the burden of
proof to establish the averments in the complaint
by preponderance of evidence, relying on the
strength of their own evidence and not upon the
weakness of their opponent's evidence (Arjonillo
v. Pagulayan, G.R. No. 196074, October 4,
2017).
REASONS:
a. There is a possibility that neither the plaintiff
nor the defendant is the true owner of the
property;
b. The one in possession is presumed to be the
owner, and he cannot be obliged to show or
prove a better title;
c. The possessor in the concept of an owner is
presumed to be in good faith; and
d. He who relies on the existence of a fact,
should prove that fact (2 PARAS, supra at
152-153).
RULE ON THE DEPRIVATION OF
PROPERTY
If the deprivation is in the exercise of the power of
eminent domain, no person shall be deprived of his
property except by competent authority and for public
use and always upon payment of just compensation
(CIVIL CODE, Art. 435).
The ownership of the property is transferred upon
payment. If conditional, ownership reverts to the
original owner when the property is no longer needed
for the purpose for which it was expropriated (DE
LEON, Property, supra at 121).
When any property is condemned or seized by
competent authority in the interest of health, safety,
or security, the owner thereof shall not be entitled to
compensation, unless he can show that such
condemnation or seizure is unjustified (CIVIL CODE,
Art. 436).
SURFACE RIGHTS
The owner of a parcel of land is the owner of its
surface and everything under it, and he can construct
thereon any works or make any plantations and
excavations which he may deem proper, without
detriment to servitudes and subject to special laws
and ordinances (CIVIL CODE, Art. 437).
NOTE: Horizontally: extends up to the boundaries
(RABUYA, Property, supra at 142).
Vertically: extends below the surface and above it to
the extent required by the economic interest of or
utility to the owner, in relation to the exploitation that
may be made of the property (Id.).
NOTE: Following the Doctrine of Ad Coleum,
ownership of land extends to the surface as well as
to the subsoil under it. Hence, building of
underground tunnels by a government agency
entitles the owner of the land to just compensation as
the sub-terrain portion of the property similarly
belongs to him (National Power Corp v. Ibrahim, G.R.
No. 168732, June 29, 2007).
Airspace: The owner cannot complain of the
reasonable requirements of aerial navigation (CIVIL
CODE, Art. 437).
Right to sub-surface: The rights over the land are
indivisible and the land itself cannot be half-
agricultural and half-mineral. The classification must
be categorical – the land must be either completely
mineral or completely agricultural. In the instant
case, the land which was originally classified as forest
land ceased to be so and became mineral — and
completely mineral — once the mining claims were
perfected. As long as mining operations were being
undertaken thereon, or underneath, it did not cease
to be so and become agricultural, even if only partly
so, because it was enclosed with a fence and was
cultivated by those who were unlawfully occupying
the surface (Republic v. CA, Dela Rosa, G.R. No. L-
43938, April 15, 1988).
The landowner’s right extends to such height or depth
where it is possible for them to obtain such benefit or
enjoyment, and it is extinguished beyond such limit
as there would be no more interest protected by law
(National Power Corp. v. Ibrahim, G.R. No. 168732,
June 29, 2007).
Restrictions: (S2ORP)
1. Servitudes or easements;
2. Special laws;
3. Ordinances;
4. Reasonable Requirements of aerial navigation;
and
5. Principles on human relations or rights of third
persons (2 PARAS, supra at 196).
HIDDEN TREASURE
(ARTS. 438-439)
REQUISITES FOR THE PROPERTY TO
BE CONSIDERED HIDDEN TREASURE
(HU-MoJO-L):
1. Hidden and Unknown deposit (such that finding it
would indeed be a discovery);
2. It consists of Money, Jewelry, or Other precious
objects; and
NOTE: The phrase “other precious objects” does
not include property embedded to the soil like
minerals (Id. at 206).
3. Their Lawful ownership does not appear (CIVIL
CODE, Arts. 438 and 439).
GENERAL RULE: The hidden treasure belongs to
the owner of the land, building, or other property on
which it is found (CIVIL CODE, Arts. 438).
EXCEPTIONS: The finder is entitled to one-half (½),
provided (AS-C-CoTAM):
1. Discovery was made on the property of Another,
or of the State or any of its political subdivisions;
2. The finding was made by Chance;
3. The finder is not a Co–owner of the property
where it is found;
4. The finder is not a Trespasser;
5. The finder is not an Agent of the landowner; and
6. The finder is not Married under the absolute
community or the conjugal partnership system
(otherwise his share belongs to the community)
(2 PARAS, supra at 201-203).
It is necessary that no known owner appears.
“Hence, the money found in a library, when the books
were delivered to the legatees in a testamentary
proceeding, could not be considered a treasure
because it was shown that the library had been used
by the testator and that money consisted, in greater
part, of this kind in circulation during the life of the
testator” (1 CAPISTRANO 394).
“And by chance” – “by good luck,” implying that one
who intentionally looks for the treasure is embraced
in the provision (DE LEON, Property, supra at 134).
The right by virtue of which the owner of a thing
becomes the owner of everything that is produced
thereby or which is incorporated or attached thereto,
either naturally or artificially (CIVIL CODE, Art. 440).

REASON: It is extremely difficult to find hidden In general, the right of accession is automatic,
treasure without looking for it deliberately, for in many requiring no prior act on the part of the owner of the
instances, the treasure is buried (2 PARAS, supra at principal (Arriola v. Arriola, G.R. No. 177703, January
202). 28, 2008).

Stranger – anyone who has absolutely no right over
the immovable or the thing in which the treasure is
found. The term also includes a lessee, a
usufructuary, or a paid laborer working for the owner
of the land, provided he has not been engaged
precisely to look for hidden treasure (2 TOLENTINO,
Civil Code, supra at 94).
Art. 440 does not apply to property of public domain
(Sps. Gulla v. Heirs of Labrador, G.R. No. 149418,
July 27, 2006).
Accession is not a mode of acquiring ownership. It is
merely an incidence or consequence of ownership
(DE LEON, Property, supra at 137).

In case of a usufructuary, he shall be considered a BASIS: It presupposes a previously existing

stranger with respect to hidden treasure which may ownership by the owner over the principal which is
be found on the land or tenement (CIVIL CODE, Art. not necessary in modes of acquiring ownership (Id.).
566). This means that the usufructuary does not get
a share. However, if he is the finder, he gets one-half ACCESSION V. ACCESSORIES
(½) as such finder.
ACCESSION ACCESSORIES
If the finder is a paid laborer of the landowner, a
As to Definition
distinction must be made. If he discovered the
property by chance, he gets half. If he had been The fruits of, or Things joined to or
employed precisely to look for the treasure, he will get additions to, or included with the
nothing insofar as the treasure is concerned; but he improvements upon, a principal thing for the
will get his wages or salary (3 MANRESA at 165-166 thing (principal). latter’s embellishment,
as cited in 2 PARAS, supra at 198). better use, or
completion.
Where things discovered do not qualify as a hidden
treasure, the rules on occupation, as a mode of As to Relation to the Principal
acquiring ownership, would be applicable
(DE LEON, Property, supra at 135). Not necessary to the It must go together with
principal thing. the principal.
If the finder or owner of the property where the (Id. at 134).
treasure is found is a married person, the treasure
forms part of the conjugal property (FAMILY CODE,
Art. 117(4)).
CLASSIFICATIONS:
1. Accession Discreta
Effect of Concealment – the right pertaining to the owner of a thing over
If the finder of the treasure conceals it from the owner everything produced thereby (Id. at 138).
of the land on which it is found, he does not thereby
lose his share; but he becomes liable civilly and REASON: Justice, pure and simple for one who
criminally for taking something not belonging to him, owns the thing should justly enjoy the fruits (Id.).
which is the share of the landowner. He will also be
responsible for all the consequences of possession in Requisites: (ORI)
bad faith with respect to the loss or deterioration of a. Increase or addition to the Original thing;
the thing (2 TOLENTINO, supra at 95). b. At Repeated intervals; and
c. By Inherent forces (Id.).

Fruits
ACCESSION Kinds of Fruits:
a. Natural Fruits
(ARTS. 440-475) i. Spontaneous products of the soil; and
 ii. The young and other products of animals
(CIVIL CODE, Art. 442, Par. 1).
Rule of Partus Sequitur Ventrem (the
offspring follows the dam/mother):
To the owner of the female animals also
belong the young of such animals, although
this right is lost when the owner mixes his
cattle with those of another (DE LEON,
Property, supra at 140).
REASON: First, it is not known who the male
is. Second, during the pregnancy of the
female, its owner is greatly burdened by the
consequential expenses and virtual
uselessness of the animal, and it is only fair
that when the young is born, the owner
should gain, or at least recover his loss (Id.
at 140-141).
b. Industrial Fruits
– those produced by lands of any kind
through cultivation or labor (CIVIL CODE,
Art. 442, Par. 2).
Perennial crops growing per season without
the need of replanting are natural fruits (DE
LEON, Property, supra at 141).
Annual crops planted each year are industrial
fruits (Id.).
c. Civil Fruits
i. Rents of buildings;
ii. Price of leases of lands; and
iii. The amount of perpetual or life annuities
or other similar income (CIVIL CODE,
Art. 442, Par. 3).
Bonus to planters for the risk undergone in
mortgaging property is not a civil fruit of the
mortgaged property having no immediate
relation to the property but only a remote and
accidental relation, not derived from the land
nor based on the value thereof (Bachrach
Motor Co. v. Talisay-Silay Milling Co., G.R.
No. 35223, September 17, 1931).
Right of Owner to the Fruits
GENERAL RULE: To the owner of the principal
belongs the natural, industrial, and civil fruits
(CIVIL CODE, Art. 441).
EXCEPTIONS: Instances when the owner of the
land does not own the fruits: (PULA)
a. Possessor in good faith;
b. Usufructuary;
c. Lessee of rural lands; or
d. In possession of an Antichretic creditor (2
PARAS, supra at 208).
NOTE: Fruits naturally falling upon adjacent land
belong to the owner of the said land and not to
the owner of the tree.
Obligation of Recipient of Fruits to Reimburse
Necessary Expenses of Third Persons
GENERAL RULE: Necessary (not luxurious)
expenses of production, gathering and
preservation (whether more or less than the
value of the fruits) must be borne by the receiver
of the fruits (CIVIL CODE, Art. 443).
Applies where:
a. The owner of the property recovers the same
from a possessor and the latter has not yet
received the fruits although they may have
already been gathered or harvested; or
b. The possessor had already received the
fruits but is ordered to return the same to the
owner (DE LEON, Property, supra at 143).
NOTE: The above provision is not applicable
when the planter is in good faith because in
this case, he is entitled to the fruits already
received; hence, there is no necessity of
reimbursing him (CIVIL CODE, Art. 544).
NOTE: The good or bad faith of the
possessor is material where the fruits are still
pending (ungathered) at the time he gave up
his possession. In any case, Art. 443 should
be read in connection with Articles 544 to 551
(DE LEON, Property, supra at 144).
A possessor in bad faith has no right
whatsoever to the fruits, gathered or pending,
except only necessary expenses for
gathered fruits (Id. at 389).
EXCEPTION: The rule does not apply to
pending fruits under Art. 449.
When Natural Fruits and Industrial Fruits
Deemed to Exist (CIVIL CODE, Art. 444)
Natural and industrial fruits, while still
ungathered, are real property. The following rules
shall apply in determining the time when they are
deemed to have existed:
a. Plants producing one crop only and then
perish – They are deemed to have existed
from the time their seedlings appear from the
ground;
b. Plants and trees living for years and
producing periodic fruits – They are
deemed to have existed from the time they
actually appeared on the plants or trees;
c. Animals – They are deemed to have existed
at the beginning of the maximum period of
gestation; and
 d. Fowls – the fact of appearance retroact to
the beginning of incubation (Id. at 145).
Rule for Civil Fruits as Distinguished from
Natural and Industrial Fruits
Civil fruits are easily prorated for under Art. 544
of the Civil Code, they are deemed to accrue
daily. They are considered in the category of
personal property and belong to the possessor in
good faith in that proportion while natural and
industrial fruits ordinarily cannot be prorated and
are considered real property while still growing (2
PARAS, supra at 216).
2. Accession Continua
– The right pertaining to the owner of a thing over
everything that is incorporated or attached
thereto, either naturally or artificially, by external
forces (Id. at 220).
REASONS: Economic convenience is better
attained in a state of single ownership than in a
co-ownership, and natural justice demands that
the owner of the principal should also own the
accessory (Id. at 211).
a. With respect to real property:
i. Accession industrial -- building, planting,
sowing
ii. Accession natural -- alluvium, avulsion,
change of course of rivers, formation of
islands
b. With respect to personal property:
i. Adjunction or conjunction
ii. Commixtion or confusion
iii. Specification
Basic Principles: (GONE-BAD)
a. He who is in Good faith may be held
responsible but will not be penalized;
b. To the Owner of a thing belongs the
extension or increase of such thing;
c. Bad faith of one party Neutralizes the bad
faith of the other;
d. There should be no unjust Enrichment at the
expense of others;
e. Bad faith involves liability for damages;
f. Accessory follows the principal; and
g. Accession exists only if the incorporation is
such that separation would either seriously
Damage the thing or Diminish its value (Id. at
220).
RIGHT OF ACCESSION
WITH RESPECT TO REAL
PROPERTY
(ARTS. 445-465)
GENERAL RULE: Whatever is built, planted, or sown
on the land of another and the improvements or
repairs made thereon belong to the owner of the land
subject to the provisions of Arts. 447-456 (CIVIL
CODE, Art. 445) and Article 120 of the Family Code.
The ownership of improvements, whether for utility or
adornment, made on the separate property of the
spouses at the expense of the partnership or through
the acts or efforts of either or both spouses shall
pertain to the conjugal partnership, or to the original
owner-spouse, subject to the following rules:
1. When the cost of the improvement made by the
conjugal partnership and any resulting increase
in value are more than the value of the property
at the time of the improvement, the entire
property of one of the spouses shall belong to the
conjugal partnership, subject to reimbursement
of the value of the property of the owner-spouse
at the time of the improvement;
2. Otherwise, said property shall be retained in
ownership by the owner-spouse, likewise subject
to reimbursement of the cost of the improvement.
In either case, the ownership of the entire
property shall be vested upon the
reimbursement, which shall be made at the time
of the liquidation of the conjugal partnership
(FAMILY CODE, Art. 120).
Scope of Building
The term “building” is a generic term for all
architectural work with a roof, built for the purpose of
being used as man’s dwelling, or for offices, clubs,
theaters, etc. (DE LEON, Property, supra at 183).
Scope of Planting
It is not necessary that the trees or plants should have
taken root; it is enough that they are planted in order
to belong to the owner of the land (2 TOLENTINO,
supra at 107).
Presumption: All works, sowing, and planting are
presumed made by the owner and at his expense,
unless the contrary is proved (CIVIL CODE, Art. 446).
NOTE: Art. 445 is applicable only if the owner of the
land is known (DE LEON, Property, supra at 146).
ACCESSION INDUSTRIA Builder, Owner of the
Landowner
Planter, Materials
(LO)
TABLE OF RIGHTS AND OBLIGATIONS Sower (B,P,S) (OM)
Builder, Owner of the indemnity preservation both acted in
Landowner
Planter, Materials and collect ; good faith).
(LO)
Sower (B,P,S) (OM) damages, 2. Lose 2. If B, P, S
OR improvement acquires
Good Faith Good Faith Good Faith 2. Demolition or s without right improvement
restoration, to indemnity , remove
1. Acquire 1. Right of 1. Collect and collect from LO materials if
improvement retention value of damages, or (CIVIL without injury
s and pay for materials 3. Sell to B, P or CODE, Art. (CIVIL
indemnity to necessary primarily rent to S, and 452) unless CODE, Art.
B, P, S; OR and useful from B, P, collect the LO sells 447);
2. Sell land to B expenses; S; damages; land. 3. No action
or P except if 2. Pay value subsidiarily 4. Pay against LO.
the value of of from LO if necessary
the land is materials B, P, S expenses to
considerably to OM. insolvent; B, P, S
more; and 2. Remove (CIVIL
rent to S only if CODE, Arts.
(CIVIL without 449, 450, and
CODE, Arts. injury 451).
448, 546, and (CIVIL
455); CODE,
3. Subsidiarily Arts. 455 Bad Faith
liable to OM. and 447).
Same as though all acted in good faith (CIVIL
CODE, Art. 453).
Good Faith Good Faith Bad Faith
Bad Faith Good Faith Good Faith
1. Acquire 1. Right of 1. Lose them
improvement retention without right 1. Acquire 1. Remove 1. Remove
s and pay for to indemnity improvement improvements materials if
indemnity to necessary (CIVIL
s after paying in any event; without
B, P, S; OR and useful CODE, Art.
indemnity and 2. Be injury;
2. Sell to B, P expenses; 449).
damages to indemnified 2. Collect value
except if the 2. Keep what
B, P, S; for damages; of materials,
value of land has been 2. Subsidiarily primarily
is built, liable to OM from B, P, S;
considerably planted, or
(CIVIL 3. Subsidiarily
more, forced sown
CODE, Arts. from LO
lease; without
454, 447, and (CIVIL
3. Without indemnity
455). CODE, Arts.
subsidiary to OM and 447 and
liability for collect 455).
cost of damages
material. (CIVIL
Bad Faith Bad Faith Good Faith
CODE,
Arts. 546
and 449). 1. Acquire 1. Right of 1.Collect value
improvement retention for of materials
s after necessary primarily from
Good Faith Bad Faith Bad Faith
indemnity to expenses; B, P, S;
B, P, S; OR 2. Pay value of subsidiarily
1. Acquire 1. Recover 1. Recover 2. Sell to B, P materials to from LO;
improvement necessary value from B, except: if the OM and pay 2.Collect
without expenses P, S (as if value is him damages damages;
paying for s(CIVIL
 Builder, Owner of the APPLICATION OF THE RULES
Landowner Art. 447 applies when the owner of the property
Planter, Materials
(LO) uses the materials of another -- whether
Sower (B,P,S) (OM)
personally or through another. It does not refer to
considerably CODE, Arts. 3.If B, P, S the instance when a possessor builds on the property
more; 546 and acquires of another (Macasaet vs. Macasaet, G.R. Nos.
3. Rent to S 447). improvements, 154391-92, September 30, 2004).
(CIVIL remove
CODE, Arts. materials in It contemplates a principal and an accessory, the land
453, 448, any event being considered the principal and the plantings,
546, 548, and (CIVIL CODE, constructions, or works, the accessory. The Supreme
455); Arts. 447, and Court considered buildings as the principal and the
4. Subsidiarily 455). lumber and construction materials as the accessory
liable to the (Pacific Farms, Inc. v. Esguerra, G.R. No. L-21783,
owner of November 29, 1969).
materials.
On the other hand, Article 448 applies when a
person builds, sows, or plants in good faith on
Good Faith Bad Faith Good Faith the land of another (DE LEON, Property, supra at
152); when he believes that he has the right to build,
1. Acquire w/o 1. Recover 1. Collect value plant, or sow because he thinks he owns the land or
paying necessary of materials believes himself to have a claim of title (Communities
indemnity expenses and Cagayan Inc. v. Sps. Arsenio¸ G.R. No. 176791,
and collect (CIVIL damages November 14, 2012).
damages; CODE, Art. from B, P, S
OR 452, and and Art. 448 refers to a land whose ownership is
2. Sell to B, P 443); subsidiarily claimed by two or more parties, one of whom has
and rent to S 2. Lose from LO; built some works, or sown or planted something.
and collect improvement 2. Remove It does not apply to a case where the owner of the
damages; s without materials in land is the builder, sower, or planter who then later
OR right of any event if loses ownership of the land by sale or donation.
3. Demolish or retention B, P, S Where the true owner himself is the builder of the
restore and from LO acquires works, the issue of good faith or bad faith is entirely
collect (CIVIL improvement irrelevant. The rule on good faith laid down in Art. 526
damages; CODE, Art. . of the Civil Code shall be applied to determine the
4. Pay 452) unless good faith of the builder in Art. 448 (Pecson v. CA,
necessary LO sells the G.R. No. 115814, May 26, 1995).
expenses to land.
B, P, S; Thus, although it does not appear from the records of
5. Subsidiarily the case that the appellee (owner of the buildings)
liable to OM owns the land upon which the buildings were erected,
(CIVIL the appellee must bear the obligation to pay for the
CODE, Arts. value of the construction materials; the appellant has
449, 450, and the corresponding right to recover the value of the
451). unpaid lumber and construction materials (Pacific
Farms, Inc. v. Esguerra, G.R. No. L-21783,
Bad Faith Good Faith Bad Faith November 29, 1969).

1.Acquire 1.Indemnity for 1.No indemnity When Co-Ownership is Terminated by Partition

improvements damages
pay indemnity 2.Remove
& damages to improvements
B, P, S (CIVIL in any event
CODE, Arts. (CIVIL CODE,
454, and 447). Arts. 454 and
447).
2.Lose The provisions of Art. 448 should apply to determine
materials the respective rights of the parties when it appears
(CIVIL that the house of an erstwhile co-owner has
CODE, Art. encroached upon a portion pertaining to another co-
449). owner which was however made in good faith (Ignao
v. IAC, G.R. No. 72876, January 18, 1991).
The provision on indemnity in Art. 448 may be applied
by analogy considering that the primary intent of the
law is to avoid a state of forced co–ownership
especially where the parties agree that Arts. 448 and
546 are applicable and indemnity for the
improvements may be paid although they differ as to
the basis of the indemnity. It is the current market
value of the improvements which should be made the
basis of reimbursement to the builder in good faith
(Pecson v. CA, G.R. No. 115814, May 26, 1995).
Property Sold by the Government due to
Delinquency
If a property was caused to be sold at a public auction
due to non-payment of taxes and the buyer at the
public auction moved not only for the delivery of the
lot but also of the improvements therein, the former
owner of the property is entitled to be reimbursed by
the buyer (Spouses Nuguid v. CA, G.R. No. 151815,
February 23, 2005).
REASON: He is a builder in good faith. He was still
the owner of the lot when he constructed the
improvement (Spouses Nuguid v. CA, G.R. No.
151815, February 23, 2005).
Cases NOT Covered:
1. Other provisions of law (e.g. usufruct, lease,
agency, co-ownership);
EXCEPTION: In case of termination of co-
ownership, rights provided in Art. 448 may apply
(Ignao v. IAC, G.R. No. 72876, January 18,
1991).
Art. 448 does not apply where one’s interest in
the land is merely that of a holder such as a mere
lessee under a rental contract (Balucanag v.
Francisco, G.R. No. L-33422, May 30, 1983), an
agent, or a usufructuary (Macasaet vs.
Macasaet, G.R. Nos. 154391-92, September 30,
2004).
Jurisprudence is replete with cases which
categorically declare that Article 448 covers only
cases in which the builders, sowers, or planters
believe themselves to be owners of the land or,
at least, have a claim of title thereto, but not when
the interest is merely that of a holder, such as a
mere tenant, agent or usufructuary. A tenant
cannot be said to be a builder in good faith as he
has no pretension to be owner. In a plethora of
cases, this Court has held that Articles 448 of the
Civil Code, in relation to Article 546 of the same
Code, which allows full reimbursement of useful
improvements and retention of the premises until
reimbursement is made, applies only to a
possessor in good faith, i.e., one who builds on
land with the belief that he is the owner thereof. It
does not apply where one's only interest is that of
a lessee under a rental contract; otherwise, it
would always be in the power of the tenant to
"improve" his landlord out of his property (Parilla
v. Pilar, G.R. No. 167680, November 30, 2006).
Lessees came into possession of the lot by virtue
of a contract of lease. They are then estopped to
deny their landlord’s title or to assert a better title
not only in themselves, but also in some third
person while they remain in possession of the
land until they surrender such possession to the
landlord (Munar v. CA, G.R. No. 100740,
November 25, 1994).
The estoppel applies even though the lessor had
no title at the time. The relation of lessor and
lessee may also be asserted by the successors
of the original lessor to the latter’s title (Feliciano
v. Sps. Zaldivar, G.R. No. 162593, September
26, 2006).
2. Improvement constructed on one’s own land
subsequently sold (Id. at 165-167);
3. Builder, a belligerent occupant (Id. at 166);
4. Constructions not in the nature of buildings (Id. at
167); and
5. Property of public dominion (Id.).
OPTIONS OF THE LANDOWNER
The landowner can choose between appropriating
the building by paying the proper indemnity or
obliging the builder to pay the price of the land, unless
its value is considerably more than that of the
structures, in which case the builder in good faith
shall pay reasonable rent. If the parties cannot come
to terms over the conditions of the lease, the court
must fix the terms thereof (Rosales v. Castelltort,
G.R. No. 157044, October 5, 2005).
The landowner may not refuse both to pay the
building and to sell the land, and, instead seek to
compel the owner of the building to remove the
building from the land. He is entitled to such removal
only when, after having chosen to sell the land, the
other party fails to pay for said land (Ignacio v. Hilario,
G.R. No. L-175, April 30, 1946).
Should no other arrangement be agreed upon, the
owner of the land does not automatically become the
owner of the improvement (Filipinas Colleges Inc. v.
Timbang, G.R. No. L-12812, September 29, 1959).
Right to Choose: The option to appropriate the
building or sell the land belongs to the landowner.
The only right of the builder in good faith is the right
to reimbursement, not to compel the owner of the
land to sell. The option is not to buy but to sell.
(Quemuel v. Olaes, G.R. No. L-11084, April 29,
1961).
Reasons Why the Option is Given to the
Landowner:
1. His right is older; and
2. By the principle of accession, he is entitled to the
ownership of the accessory thing (Communities
Cagayan Inc. v. Sps. Arsenio, G.R. No. 176791,
November 14, 2012).
NOTE: Where the builder, planter or sower has acted
in good faith, a conflict of rights arises between the
owners, and it becomes necessary to protect the
owner of the improvements without causing injustice
to the owner of the land. In view of the impracticability
of creating a state of forced co-ownership, the law
has provided a just solution (Depra v. Dumlao, G.R.
No. L-57348, May 16, 1985).
In view of the impracticability of creating a state of
forced co-ownership, the law has provided a just
solution by giving the owner of the land the option to
acquire the improvements after payment of the
proper indemnity, or to oblige the builder or planter to
pay for the land and the sower the proper rent. He
cannot refuse to exercise either option (Communities
Cagayan Inc. v. Sps. Arsenio, G.R. No. 176791,
November 14, 2012).
Not even a declaration of the builder’s bad faith shifts
the option to him as provided in Art. 450 of the Civil
Code (Sps. Benitez v. CA, G.R. No. 104828, January
16,1997).
Once the choice is made by the landowner, it is
generally irrevocable (Tayag v. Yuseco, G.R. No. L-
8139, October 24, 1955).
The so-called “workable solution” suggested in the
case of Grana v. CA (G.R. No. L-12486, August 31,
1960) where the Court ordered the owner of the land
to sell to the builder, etc. the part of the land intruded
upon thereby depriving him of his right to choose
because it would be impractical to choose the first
alternative for the whole improvement might be
rendered useless, is contrary to the explicit provisions
of Art. 448 to the effect that, "(t)he owner of the
land…shall have the right to appropriate…or to oblige
the one who built…. to pay the price of the land…"
The law is clear and unambiguous when it confers the
right of choice upon the landowner and not upon the
builder and the courts (Ignao v. IAC, G.R. No. 72876,
January 18, 1991).
NOTE: Art. 448 is not mandatory. There is nothing,
however, in the law to prevent the parties from
agreeing to adjust their rights in some other way.
REMEDIES OF THE PARTIES
The following are the remedies of the parties should
the builder in good faith is unable to pay the value of
the land as demanded by the landowner:
1. The parties may decide to leave things as they
are and assume the retention of lessor and
lessee, and should they disagree as to the
amount of rental, then they can go to the court to
fix that amount;
2. Should the parties not agree to assume the
relation of lessor and lessee, the owner of the
land is entitled to have the improvement
removed; and
3. The land and the improvement may be sold at
public auction, applying the proceeds thereof first
to the payment of the value of the land and the
excess, if any to be delivered to the owner of the
improvement in payment thereof (Filipinas
Colleges, Inc. v. Timbang, G.R. No. L-12812,
September 29, 1959).
NOTE: These alternative remedies shall be
resorted to by the parties when the builder in
good faith fails to pay the value of the land when
such is demanded by the landowner. Take note
too that the options of the landowner under Art
448 are alternative and exclusive. (Filipinas
Colleges, Inc. v. Timbang, G.R. No. L-12812,
September 29, 1959).
WHO IS A BUILDER IN GOOD FAITH?
To be considered a builder in good faith, it is essential
that a person asserts title to the land in which he
builds, i.e., that he be a possessor in the concept of
an owner and that he be unaware that there exists in
his title or mode of acquisition any flaw which
invalidates it (Spouses de Vera v. Spouses
Mayandoc, G.R. No. 211170, July 3, 2017).
The terms builder, planter, or sower in good faith as
used in reference to Article 448 of the Civil Code,
refer to one who, not being the owner of the land,
builds, plants, or sows on that land believing himself
to be its owner and unaware of the defect in his title
or mode of acquisition. The essence of good faith lies
in an honest belief in the validity of one's right,
ignorance of a superior claim, and absence of
intention to overreach another. On the other hand,
bad faith may only be attributed to a landowner when
the act of building, planting, or sowing was done with
his knowledge and without opposition on his part
(Delos Santos v. Abejon, G.R. No. 215820, March 20,
2017).
Good Faith May co-exist with Negligence
Good faith does not necessarily preclude negligence,
for, in fact, in negligence there is no intention to do
wrong or cause damage unlike in bad faith which
presupposes such intention (DE LEON, Property,
supra at 177).
Articles 448 and 546 on builders in good faith is
not applicable to cases covered by the
Condominium Code
Articles 448 and 546 of the Civil Code on builders in
good faith are inapplicable in cases covered by the
Condominium Act where the owner of the land and
the builder are already bound by specific legislation
on the subject property (the Condominium Act), and
by contract (the Master Deed and the By-Laws of the
condominium corporation). The raison d'etre for this
is where the builder, planter or sower has acted in
good faith, a conflict of rights arises between the
owners, and it becomes necessary to protect the
owner of the improvements without causing injustice
to the owner of the land (Leviste Management
System, Inc., vs. Legaspi Towers 200, Inc., G.R. No.
199353, April 4, 2018).
ACCESSION NATURAL
1. ALLUVION OR ALLUVIUM (CIVIL CODE,
Arts. 457 and 458)
– increment gradually received by lands abutting
rivers as a result of the current of the waters
Accretion – the process by which a riparian land
gradually and imperceptibly receives addition
made by the water to which the land is contiguous
Riparian owner – the owner of the land adjacent
to the river bank
Littoral owner – the owner of lands bordering
the shore of the sea or lake or other tidal waters
If the increment is formed by the action of the sea,
the same is not called alluvium/accretion but
foreshore land. As such, it is part of the public
domain (Heirs of E. Navarro v. IAC, G.R. No.
68166, February 12, 1997).
ALLUVION V. ACCRETION
ALLUVION ACCRETION
As to Concept
Soil deposited on the Process by which the
estate fronting the river soil is deposited.
bank.
As to Application
Applies only to the soil Broader term.
deposited on river banks.
(2 PARAS, supra at 265-266).
Requisites of Alluvion or Accretion (G-Cae):
a. The deposit or accumulation of soil or
sediment must be Gradual and imperceptible
(increase must be comparatively little);
b. The accretion must result from the effects or
action of the Current of the water;
c. The land where Accretion takes place is
adjacent to the bank of the river; and
d. The river must continue to Exist (2 PARAS,
supra at 266).
REASONS FOR THE RULE:
a. To compensate the owner for losses which
they may suffer by erosion;
b. To compensate them for the burdens of legal
easements, which are imposed upon them;
c. Because it is the owner of the contiguous
land who can utilize the increment to the best
advantage; and
d. Because this is the only feasible solution,
since the previous owners can no longer be
identified (Id. at 267-268).
Effects of Accretion on Registered Lands
a. In case of diminution of area
Registration under Torrens System does not
protect the riparian owners against the
diminution of the area of his registered land
(Viajar v. CA, G.R. No. 77294, December 12,
1988).
b. In case of increase of area
An alluvion is automatically owned by the
riparian owner from the moment the soil
deposit can be seen, but the additional area
does not automatically become registered
land just because the lot which receives such
accretion is covered by a Torrens title. The
riparian owner must register the additional
area within 50 years (Heirs of E. Navarro v.
IAC, G.R. No. 68166, February 12, 1997).
 NOTE: Ownership of a piece of land is one
thing; registration under the Torrens system
of that ownership is another (Delos Reyes v.
Municipality of Kalibo, Aklan, G.R. No.
214587, February 26, 2018).
Article 84 of the Spanish Law of Waters of
1866 specifically covers ownership over
alluvial deposits along the banks of a creek.
It reads: ART. 84. Accretions deposited
gradually upon lands contiguous to creeks,
streams, rivers, and lakes, by accessions or
sediments from the waters thereof, belong to
the owners of such lands. Interestingly,
Article 457 of the Civil Code states: Art. 457.
To the owners of lands adjoining the banks
of rivers belong the accretion which they
gradually receive from the effects of the
current of the waters. It is therefore explicit
from the foregoing provisions that alluvial
deposits along the banks of a creek do not
form part of the public domain as the alluvial
property automatically belongs to the owner
of the estate to which it may have been
added. The only restriction provided for by
law is that the owner of the adjoining property
must register the same under the Torrens
system; otherwise, the alluvial property may
be subject to acquisition through prescription
by third persons (Office of the City Mayor of
Parañaque City v. Ebio, G.R. No. 178411,
June 23, 2010).
NOTE: Lands acquired by accretion as provided
in Art. 457 is not lost upon the sudden and
abrupt change of course by the river and
separated to the other side (Agustin v. IAC, G.R.
Nos. L-66075, July 5, 1990). In the absence of
evidence that the change in the course of the
river was sudden, the presumption is that the
change was gradual and was caused by alluvium
and erosion (Payatas-Estate Improvement Co. v.
Tuason, G.R. No. 30067, March 23, 1929).
NOTE: In the absence of evidence that the
change in the course of the river was sudden or
that it occurred through avulsion, the
presumption is that the change was gradual and
was caused by alluvium and erosion (Bagaipo v.
Court of Appeals, G.R. No. 116290, December 8,
2000).
Deposit Caused by Human Intervention Not
Covered
A riparian owner does not acquire the addition to
his land caused by special works (e.g. dikes)
expressly intended by him to bring about
accretion (i.e., for reclamation purposes) and not
to protect his property from the destructive force
of the waters of the river (Republic v. CA, G.R.
No. L-61647, October 12, 1984).
Art. 457 excludes all deposits caused by human
intervention. Alluvion must be the exclusive work
of nature (Vda. De Nazareno, et al. V. CA, G.R.
No. 98405, June 26, 1996).
Effect of Public Service Constructions or
Easements on River Banks
a. If a public service construction, like a railroad
or a road, is made on a river bank, it is the
government or the railroad company which
will own the accretion.
b. If instead of a public service construction,
there is only an easement for the benefit of
navigation, floatage, fishing, and salvage, the
right of the riparian owner subsists because
in easements, the owner of the servient
estate does not lose his ownership over the
portion covered (2 PARAS, supra at 269-
270).
Estates Adjoining Ponds or Lagoons
The owners of estates adjoining ponds or
lagoons do not acquire the land left dry by the
natural decrease of the waters, or lose that
inundated by them in extraordinary floods (CIVIL
CODE, Art. 458).
Definitions:
a. Pond
– a body of stagnant water without an outlet
b. Lagoon
– a small lake, ordinarily of fresh water and
not very deep, fed by floods, the hollow bed
of which is bounded by the elevation of the
land
c. Lake
– a body of water formed in depressions of
the earth, ordinarily fresh water, coming from
rivers, brooks, or springs and connected by
them to sea
NOTE: This provision refers to ponds and
lagoons, and therefore has no application to
lakes (2 TOLENTINO, supra at 129).
2. AVULSION
The transfer of a known portion of land from one
tenement to another by the force of the current.
The portion of land must be such that it can be
identified as coming from a definite tenement
(CIVIL CODE, Art. 459).
Also called “force of the river” since it implies a
violent tearing or breaking away.
It may also be referred as “delayed accession” in ALLUVIUM V. AVULSION
the sense that if the owner abandons the soil
involved or fails to remove the same within two ALLUVIUM AVULSION
years, the land to which it has been attached
As to Process
acquires ownership thereof (2 PARAS, supra at
271). Gradual and Sudden or abrupt
imperceptible process
Art. 459 can be applied by analogy in case a
known portion of a land is transferred from one
estate to another by forces of nature other than As to Identity of Soil
the current of a river (DE LEON, Property, supra
at 178). Soil cannot be Identifiable and
identified verifiable

As to Ownership

Belongs to the owner Belongs to the owner

of the property to from whose property it
which it is attached was detached

(2 PARAS, supra at 275).

Removal Within Two (2) Years: The owner

must remove (not merely claim) the transported
portion within two years to retain ownership
(CIVIL CODE, Art. 459).

Reasons for Removal

Requisites (CSK):
a. The segregation and transfer must be
caused by the Current of a river, creek or
torrent;
b. The segregation and transfer must be
Sudden or abrupt; and
c. The portion of land transported must be
Known or identified (Id. at 189).
Current – the continuous movement of a body of
water, often horizontal, in a certain direction (Id.
at 190).
River – a natural stream of water, of greater
volume than a creek or rivulet flowing, in a more
or less permanent bed or channel, between well-
defined banks or walls, with a current which may
either be continuous in one direction or affected
by the ebb and flow of the tide (Id.).
Creek – a small stream less than a river; a recess
or inlet in the shore of a river, and not a separate
or independent stream though it is sometimes
used in the latter meaning (Id.).
Torrent – a violent, rushing, and turbulent stream
a. The segregated portion is usually very small;
b. If the area is large there is a need to claim for
its value within two (2) years;
c. If there is no need for claim, ill feeling may
arise between the neighbors;
d. To prevent legal absurdities;
e. To prevent permanent attachment; and
f. The principle is similar to that underlying Art.
460 (2 PARAS, supra at 276-277).
Rule on Uprooted Trees
Trees uprooted and carried away by the current
of the waters belong to the owner of the land
upon which they may be cast, if the owners do
not claim them within 6 months (CIVIL CODE,
Art. 460).
If such owner claims them, they shall pay the
expenses incurred in gathering them or putting
them in a safe place (CIVIL CODE, Art. 460).
The 6-month period is a condition precedent and
not a prescription. After a claim is made within 6
months, an action may be brought within the
prescription period provided under Art. 1140.
 If he has incurred expenses for preserving them, as
when he gathered them in a safe place for eventual
return, or when he transplants them, only for
preservation purposes, he is entitled to
indemnification.

If he has done nothing, he cannot demand

indemnification unless he has suffered in any way
and the real owner benefited (2 PARAS, supra at
280).

In case of uprooted trees, the owner retains

ownership if he makes a claim within six (6) months.
This does not include trees which remain planted on
a known portion of land carried by the force of the
waters. In the latter case, the trees are regarded as
accessions of the land through gradual changes in
the course of adjoining stream (Payatas Estate
Improvement Co. v. Tuason, G.R. No. 30067, March
23, 1929).
If the owner of the land upon which the trees have NOTE: If the tree is still attached to the portion of the
been cast, transplanted them on his own land, the land transferred to the other estate, Art. 459 on
former owner may still recover the same within the avulsion applies and not Art. 460.
period of 6 months (3 MANRESA, 244 as cited in 2
PARAS, supra at 273).

Indemnification of Owner of the Land Upon Which

Uprooted Trees may have been Cast
Trees uprooted and carried away by the current of the
waters belong to the owner of the land upon which
they may be cast, if the owners do not claim them
within six months. If such owners claim them, they
shall pay the expenses incurred in gathering them or
putting them in a safe place (CIVIL CODE, Art. 460).
3. CHANGE OF COURSE OF RIVERS
The owner of estate A owns the old river bed in
proportion to the area lost or occupied by the new
bed on his land.
Rules:
a. River beds which are abandoned through the
natural change in the course of the waters
ipso facto belong to the owners whose lands
are occupied by the new course in proportion
to the area lost;
“Ipso facto” - the prejudiced owner
automatically becomes the owner of the
abandoned river bed (DE LEON, Property,
supra at 191).
b. The owners of the land adjoining the old bed
shall have the right to acquire the same by
paying the value thereof, which value shall
not exceed the value of the area occupied by
the new bed (CIVIL CODE, Art. 461); and
c. Whenever a river, changing its course by
natural changes, opens a new bed through a
private estate, this bed shall become of
public dominion (CIVIL CODE, Art. 462).
Requisites: (CA2PE)
a. There must be a natural Change in the
course of the waters of the river; otherwise,
the bed may be the subject of a State grant
(REYES–PUNO, An Outline of the Philippine
Civil Law, (1964), p.54 [hereinafter REYES-
PUNO, Philippine Civil Law]);
b. The change must be Abrupt or sudden;
c. There must be Abandonment by the owner
of the bed i.e., a decision not to bring back
the river to the old bed (Id. at 53);
d. The change must be Permanent; the rule
does not apply to temporary overflowing; and
e. The river continues to Exist (2 PARAS, supra
at 283-284).
“River beds which are abandoned” means that
where there is abandonment by the government
of its right over the old bed, the owner of the
invaded land automatically acquires ownership of
the same without the necessity of any formal act
on his part. No positive act is needed on their
part, as it is subject thereto ipso jure from the
moment the mode of acquisition becomes
evident (2 TOLENTINO, supra at 137).
“In proportion to the area lost” contemplates
two or more owners whose lands are occupied by
the new bed. If only one owner has lost, he gets
the entire abandoned river bed (2 PARAS, supra
at 281).
It does not apply to cases where the river simply
dries up because there are no persons whose
lands are occupied by the waters of the river. The
new river bed thus formed become of public
dominion (Id.).
4. FORMATION OF ISLAND BY THE
BRANCHING OFF OF A RIVER
Whenever the current of a river divides itself into
branches, leaving a piece of land or part thereof
isolated, the owner of the land retains his
ownership. He also retains it if a portion of land is
separated from the estate by the current (CIVIL
CODE, Art. 463).
There is isolation where the portion has not
physically moved. There is separation when
such portion has physically moved (2 PARAS,
supra, at 233).
NOTE: The piece of land formed by isolation or
separation belongs to the owner of property B
since no accession takes place. He retains
ownership over the land (Id.).
5. FORMATION OF ISLANDS BY
SUCCESSIVE ACCUMULATION OF
ALLUVIAL DEPOSITS
a. If formed on the sea:
i. Within territorial waters – the island/s
belong/s to the state; said island/s is/are
considered patrimonial property (CIVIL
CODE, Art. 464).
ii. Outside territorial waters – to the first
occupant; this is in accordance with the
principles of Public International Law for
discovery and occupation considered as
a definite mode of acquiring territory.
b. If formed in lakes, or navigable or floatable
rivers – State; also a patrimonial property
(CIVIL CODE, Art. 464).
Navigable or floatable river – if useful for
floatage and commerce, whether the tides
affect the water or not; should benefit trade
and commerce (2 PARAS, supra at 233).
c. If formed on non–navigable or non–floatable
rivers:
i. If nearer to one margin or bank – to the
nearer riparian owner (CIVIL CODE, Art.
465).
REASON: The nearer margin has the
better chances of developing the island
in the interest of agriculture (2 PARAS,
supra at 244).
ii. If equidistant from both banks – to the
riparian owners, by halves (CIVIL CODE,
Art. 465).
RIGHT OF ACCESSION
WITH RESPECT TO
PERSONAL PROPERTY
(ARTS. 466-475)
Basic Principle: Whenever the things united can be
separated without injury, their respective owners may
demand their separation (CIVIL CODE, Art. 469).
Accession exists only if separation is not feasible.
KINDS:
1. ADJUNCTION/CONJUNCTION (CIVIL
CODE, Arts. 466-471)
– The union of two movable things belonging to
different owners, in such a manner that they
cannot be separated without injury, thereby
forming a single object (DE LEON, Property,
supra at 197).
Requisites: (MUI)
a. There are two Movables belonging to
different owners;
b. They are United in such a way that they form
a single object; and
c. They are so Inseparable that their separation
would impair their nature or result in
substantial injury to either component (Id. at
198).
NOTE: The application of the rule of accessorium
sequitur principale (“the accessory follows the
principal”) must give way to any express or
implied agreement of the owners as to the
ownership of the new object (2 TOLENTINO,
supra at 142).
Kinds: (ISEPT)
a. Inclusion or engraftment (e.g. when a
diamond is set on a gold ring);
b. Soldadura or soldering (e.g. when lead is
united or fused to an object made of lead);
i. Ferruminacion – if both the accessory
and principal objects are of the same
metal; or
ii. Plumbatura – if the accessory and
principal objects are of different
materials.
c. Escritura or writing (e.g. when a person
writes on a paper belonging to another);
d. Pintura or painting (e.g. when a person paints
on a canvas belonging to another); and
e. Tejido or weaving (e.g. when threads
belonging to different owners are used in
making textile) (DE LEON, Property, supra at
198).
Tests to Determine Principal in Adjunction:
a. Test of Intention – the principal thing, as
between two things incorporated, is deemed
to be that to which the other (accessory) has
been united as an ornament or for its use or
perfection (CIVIL CODE, Art. 467);
b. If it cannot be determined by the rule given in
Art. 468:
If the two things are of unequal values – the
thing of greater value shall be considered the
principal;
If they are of equal values – the thing of
greater volume shall be considered the
principal (CIVIL CODE, Art. 468).
NOTE: In all cases, sentimental value shall be
duly appreciated (CIVIL CODE, Art. 475).
With reference to a motor vehicle, the engine
may be considered as the principal, all the other
parts of the vehicle being regarded as mere
accessories (2 PARAS, supra at 293).
SPECIAL RULE: In painting and sculpture,
writings, printed matter, engraving and
lithograph, the board, metal, stone, canvas,
paper, or parchment, shall be deemed the
accessory thing (CIVIL CODE, Art. 468). This is
based on the consideration that what is painted,
etc. is of greater value or importance than the
board, etc. (DE LEON, Property, supra at 199).
NOTE: Since the special rule specifies the
special cases, analogous cases which are not
enumerated should not be solved analogously,
but in accordance with the general tests provided
for in Arts. 476 and 468, first paragraph (2
PARAS, supra at 293).
2. MIXTURE
Rules on who is Entitled:
a. Adjunction in good faith by either owner
GENERAL RULE: Accessory follows the
principal.
EXCEPTIONS (SP):
i. If the accessory can be Separated
without injury, their respective owners
may demand their separation (CIVIL
CODE, Art. 469); and
ii. If the accessory is much more Precious
than the principal, the owner of the
accessory may demand the separation
even if the principal suffers some injury
(CIVIL CODE, Art. 469).
b. Adjunction in bad faith by the owner of
the principal
The owner of the accessory thing shall have
a right to choose between:
i. The principal paying him its value; or
ii. The thing (accessory) belonging to him
be separated, even though for this
purpose it be necessary to destroy the
principal thing (CIVIL CODE, Art. 470).
In either case, the principal shall be liable
for damages (CIVIL CODE, Art. 470).
c. Adjunction in bad faith by the owner of
the accessory
Whenever the owner of the accessory thing
has made the incorporation in bad faith:
i. He shall lose the thing (accessory)
incorporated; and
ii. He shall have the obligation to indemnify
the owner of the principal thing for the
damages he may have suffered (CIVIL
CODE, Art. 470).
d. Adjunction in bad faith by both owners
If either one of the owners has made the
incorporation with the knowledge and without
the objection of the other, their respective
rights shall be determined as though both
acted in good faith (CIVIL CODE, Art. 470).
In such case, apply Arts. 466 to 499.
Form of Indemnity to Owner of Material
Whenever the owner of the material employed
without his consent has a right to an indemnity,
he may demand that this consists in the:
1. Delivery of a thing equal in kind and value;
2. Payment of price as appraised by experts
(CIVIL CODE, Art. 471).
– It takes place when 2 or more things belonging
to different owners are mixed or combined with
the respective identities of the component parts
destroyed or lost (DE LEON, Property, supra at
203).
NOTE: As distinguished from adjunction, there is
in mixture greater inter-penetration or
decomposition of the objects that have been
mixed (Id.).
Kinds:
a. Commixtion – mixture of solids
b. Confusion – mixture of liquids
Rules:
a. Mixture by will of the owners:
i. Primarily, their rights should be governed
by their stipulations (Id. at 203-204);
 ii. In the absence of any stipulation, each the following option with a right to indemnity
owner shall acquire a right proportional for damages:
to the part belonging to him, bearing in i. Appropriate the new thing without paying
mind the value of the things mixed or the owner of the material; or
confused (CIVIL CODE, Art. 472). ii. Require the owner of the material to pay
b. Mixture caused by an owner in good faith or him the value of the thing or value of his
by chance: Each owner shall acquire a right work or labor (DE LEON, Property, supra
proportional to the part belonging to him, at 210).
bearing in mind the value of the things mixed
or confused (CIVIL CODE, Art. 472). c. Owner of the principal (worker) in bad faith,
c. By one owner in bad faith: the owner of the material has the option:
i. He loses all his rights to his own material; i. To appropriate the work to himself
and without paying anything to the maker; or
ii. He is liable for damages (CIVIL CODE, ii. To demand of the maker that he
Art. 473). indemnify him for the value of the
d. With the knowledge and without the objection material and the damages that he may
of owner: As though both acted in good faith have suffered (CIVIL CODE, Art. 474).
(DE LEON, Property, supra at 203-204);
e. By the negligence of one of the parties: The EXCEPTION TO THE EXCEPTION: The owner
negligent owner is liable for damages (Id.). of the material cannot appropriate the work in
case the value of the latter, for artistic or scientific
3. SPECIFICATION reasons, is considerably more than that of the
One who in good faith employs the material of material (CIVIL CODE, Art. 474).
another in whole or in part in order to make a
thing of a different kind shall appropriate the thing Form of Indemnity to Owner of Material
thus transformed as his own, indemnifying the Whenever the owner of the material employed
owner of the material for its value (CIVIL CODE, without his consent has a right to an indemnity,
Art. 474). he may demand that this consist in the:
1. Delivery of a thing equal in kind and value;
The transformation of another’s material by the 2. Payment of price as appraised by experts
application of labor. The material becomes a (CIVIL CODE, Art. 471).
thing of different kind. Labor is the principal (2
PARAS, supra at 299). NOTE: In determining the value, sentimental
value must be taken into account (CIVIL CODE,
Example: Using the paint of another to make a Art. 475).
painting on your own canvas (Id.).
ADJUNCTION V. MIXTURE V.
NOTE: If you use your own paint on the canvas SPECIFICATION
of another, this is adjunction. Reason: the canvas
is considered the accessory in Art 468 on ADJUNCTION MIXTURE SPECIFICATION
adjunction (Id.).
As to Number of Things Involved
GENERAL RULE: Involves at Involves at May involve
a. Owner of the principal (worker) in good faith: least two (2) least two (2) one (1) thing
i. Maker acquires the new thing; and things. things. (or more) but
ii. He must indemnify the owner of the form is
material (Id.). changed.
EXCEPTION:
If the material is more precious than the As to Ownership
transformed thing or is of more value, its
owner may, at his option: Accessory Co- Accessory
i. Appropriate the new thing to himself, follows the ownership follows the
after first paying indemnity for the principal. results. principal.
value of the work; or
ii. Demand indemnity for the material As to Nature of the Things
(CIVIL CODE, Art. 474).
Things Things The new
b. Owner of the principal (worker) in good faith joined retain mixed or object retains
but owner of material in bad faith. Applying their nature. confused or preserves
Art. 470, Par. 2 by analogy, the worker has may either the nature of

retain or lose the original
their object.
respective
natures.
(DE LEON, Property, supra at 212-213).
QUIETING OF TITLE
(ARTS. 476-481)
ACTION TO QUIET TITLE
An action for quieting of title is essentially a common
law remedy grounded on equity. The competent court
is tasked to determine the respective rights of the
complainant and other claimants, not only to place
things in their proper place, to make the one who has
no rights to said immovable respect and not disturb
the other, but also for the benefit of both, so that he
who has the right would see every cloud of doubt over
the property dissipated, and he could afterwards
without fear introduce the improvements he may
desire, to use, and even to abuse the property as he
deems best (Mananquil, et. al. v. Moico, G.R. No.
180076, November 12, 2012).
PURPOSE: To secure an adjudication that a claim of
title to or an interest in property, adverse to that of
complainant is invalid, so that the complainant and
those claiming under him may be forever afterward
free from any danger of hostile claim (2 PARAS,
supra at 301).
CLOUD ON TITLE
A semblance of title, either legal or equitable, or a
claim or a right in real property, appearing in some
legal form but which is, in fact, invalid or which would
be inequitable to enforce (DE LEON, Property, supra
at 215).
REQUISITES FOR THE EXISTENCE OF
CLOUD ON TITLE (IRCEP-VIP):
1. There is an Instrument, Record, Claim,
Encumbrance, or Proceeding (IRCEP);
2. The instrument, claim, encumbrance, or
proceeding is apparently Valid or effective;
3. Such instrument, etc. is in truth and in fact,
Invalid, ineffective, voidable, or unenforceable, or
has been extinguished or terminated, or has
been barred by extinctive prescription; and
4. Such instrument, etc. may be Prejudicial to said
title (CIVIL CODE, Arts. 476 and 478).
GENERAL RULE: Only real property could be the
subject matter of quieting of title (DE LEON, Property,
supra at 217).
EXCEPTION: Certain personal properties like
vessels may be the object of quieting of title (Id.).
NATURE: Actions for quieting of title are neither suits
in rem nor suits in personam. They are suits against
a particular person in respect to the res and the
judgment will apply only to the property in dispute.
They are suits quasi in rem (Realty Sales Enterprise,
Inc. v. IAC, G.R. No. L-67451, September 28, 1987).
Actions quasi in rem deal with the status, ownership
or liability of a particular property but which are
intended to operate on these questions only as
between the particular parties to the proceedings and
not to ascertain or cut off the rights or interests of all
possible claimants. The judgments therein are
binding only upon the parties who joined in the action
(Spouses Pozon v. Lopez, G.R. No. 210607, March
25, 2019).
KINDS OF ACTION REFERRED TO (REP):
1. Remedial
– An action to remove the cloud or to quiet title to
real property or an interest therein (CIVIL CODE,
Art. 476, par. 1);
2. Extinctive
– An action to quiet title or remove cloud
therefrom when the contract, instrument, other
obligation has been extinguished or has been
terminated or has been barred by extinctive
prescription (CIVIL CODE, Art. 478); and
3. Preventive
– An action to prevent a future cloud or doubt
from being cast upon the title to real property or
an interest therein (CIVIL CODE, Art. 476, par.
2).
REASONS FOR ALLOWING THE
ACTION:
1. The prevention of litigation;
2. The protection of the true title and possession;
and
3. The promotion of right and justice (2 PARAS,
supra at 486).
REQUISITES FOR AN ACTION TO QUIET
TITLE TO PROSPER: (LCD)
1. Plaintiff must have a Legal or equitable title to, or
interest in the real property, which is the subject
matter of the action, but he need not be in
possession of the property (CIVIL CODE, Art.
477).
 QUIETING OF TITLE V. REMOVING OF
In order that an action for quieting of title may CLOUD V. PREVENTING A CLOUD
prosper, the plaintiff must have legal or equitable
title to, or interest in, the property which is the QUIETING OF REMOVING PREVENTING
subject matter of the action. While legal title TITLE OF CLOUD A CLOUD
denotes registered ownership, equitable title
means beneficial ownership. In the absence of As to Purpose
such legal or equitable title, or interest, there is
To put an end To procure the To remove
no cloud to be prevented or removed. Likewise,
to vexatious cancellation, possible
the plaintiff must show that the deed, claim,
litigation with delivery, foundation of
encumbrance, or proceeding that purportedly
respect to the release of an a future
casts a cloud on their title is in fact invalid or
property instrument, hostile claim.
inoperative despite its prima facie appearance of
involved. encumbrance
validity or legal efficacy (Delos Reyes v.
or claim, which
Municipality of Kalibo, Aklan, G.R. No. 214587,
constitutes a
February 26, 2018).
claim in
plaintiff’s title,
In the absence of such legal or equitable title, or
and which may
interest, there is no cloud to be prevented or
be used to
removed (Spouses Basa v. De Senly Loy, G.R.
injure or vex
No. 204131, June 4, 2018).
him in his
enjoyment of
The Court ruled that a judgment debtor who failed
his title.
to redeem the property within the time provided
for had lost whatever right he had over the land As to Nature of Action
in question. Certainly, he no longer possessed
any legal or equitable title to or interest over the Remedial in Preventive in Preventive in
parcels of land; hence, he cannot validly maintain nature, nature, in nature, in
an action for quieting of title (Lucasan v. involves a order to order to
Philippine Deposit Insurance Corporation G.R. present remove cloud prevent a
No. 176929, July 4, 2008). adverse which may be future cloud.
claim. used for future
2. There must be a Cloud in such title; actions.

3. Such cloud must be Due to some instrument, As to Nature of Claims

record, claim, encumbrance or proceeding which
is apparently valid or effective but is in truth Plaintiff Plaintiff No claim yet.
invalid, ineffective, voidable or unenforceable, asserts own declares his
and is prejudicial to the plaintiff’s title (CIVIL claim and own claim and
CODE, Art. 476). declares that title, and at the
the claim of same time
There may also be an action to quiet title or remove the defendant indicates the
a cloud there from when the contract, instrument or is unfounded source and
other obligation has been extinguished or has and calls on nature of
terminated, or has been barred by extinctive the defendant defendant’s
prescription (CIVIL CODE, Art. 478). to justify his claim, pointing
claim on the its defect and
REQUISITES FOR AN ACTION TO property for praying for the
the court to declaration of
PREVENT A CLOUD ON TITLE (TBA): determine the its invalidity.
1. Plaintiff has a Title to a real property or interest same.
therein;
2. Defendant is Bent on creating a cloud on the title Filed Against Whom
or interest therein. The danger must not be
merely speculative or imaginary but imminent; Filed against Filed against No claim yet.
and people who defendants
3. Unless the defendant is restrained or stopped, have who assert
the title or interest of the plaintiff will be prejudiced claims which claims based
or Adversely affected (DE LEON, Property, supra are more on an invalid
at 217). instrument

general in (but not
nature. apparent).
(Id. at 223-229).
Not a collateral attack on title
Raising the invalidity of a certificate of title in an action
for quieting of title is NOT a collateral attack because
it is central, imperative, and essential in such an
action that the complainant shows the invalidity of the
deed which casts cloud on the title (Filipinas Eslon
Manufacturing Corp. vs Heirs of Basilio Llanes, G.R.
No. 194114, March 27, 2019).
PRESCRIPTIVE PERIOD:
1. Plaintiff in possession
– Imprescriptible, because the owner is given the
continuing aid by the court to ascertain and
determine the nature of such claim and its effect
on his title. He can wait until his possession is
disturbed and attacked before taking steps to
vindicate his right (Coronel v. IAC, G.R. No.
70191, October 29, 1987).
2. Plaintiff not in possession
– 10 years (ordinary) or 30 years (extraordinary)
or estoppel by laches will be applicable (DE
LEON, Property, supra at 225).
An action for reconveyance based on implied
trust partakes the nature of an action for quieting
of title if the plaintiff remains in possession of the
subject property, thereby making the action
imprescriptible
The Court, in a catena of cases, has permitted the
filing of an action for reconveyance despite the lapse
of more than ten (10) years from the issuance of title.
The common denominator of these cases is that the
plaintiffs therein were in actual possession of the
disputed land, converting the action from
reconveyance of property into one for quieting of title.
Imprescriptibility is accorded to cases for quieting of
title since the plaintiff has the right to wait until his
possession is disturbed or his title is questioned
before initiating an action to vindicate his right
(Ocampo v. Ocampo, Sr., G.R. No. 227894, July 5,
2017).
THE ACTION TO QUIET TITLE DOES NOT
APPLY (BIC-SIQ):
1. To Boundary disputes;
The courts cannot, in an action for quieting of title,
order the determination of the boundaries of the
claimed property, as that would be tantamount to
awarding to one or some of the parties the
disputed property in an action where the sole
issue is limited to whether the instrument, record,
claim, encumbrance or proceeding involved
constitutes a cloud upon the petitioners’ interest
or title in and to said property (Vda. de Aviles v.
CA, G.R. No. 95748, November 21, 1996).
2. To questions involving Interpretation of
documents;
3. To mere written or oral assertions of Claims,
except if made in a legal proceeding;
4. If it is being asserted that the instrument or entry
in plaintiff’s favor is not what it purports to be;
5. To deeds by Strangers to the title unless
purporting to convey the property of the plaintiff;
6. To instruments Invalid on their face; and
7. Where the validity of the instrument involves pure
Questions of law (2 PARAS, supra at 315).
NOTE: The possession of the actual possessor must
be respected during the pendency of the case for
quieting of title (Balbecino v. Judge Ortega, G.R. No.
L-14231, April 28, 1962).
Duty of Plaintiff to Return Benefits and Expenses:
The plaintiff must return to the defendant all benefits
he may have received from the latter, or reimburse
him for expenses that may have redounded to the
plaintiff’s benefit (CIVIL CODE, Art. 479).
Restoration is required whenever the complainant is
shown to be morally bound to reimburse the
defendant. Even if the debt is not enforceable by
reason of the statute of limitations, payment may be
required by the court (DE LEON, Property, supra at
229).
REASON: “He who seeks equity must do equity”
(Id.).
PURPOSE: To quiet title, not to obtain pecuniary
interest (Id.).
RUINOUS BUILDINGS
AND TREES IN DANGER
OF FALLING
(ARTS. 482-483)
AS TO BUILDINGS:
If a building, wall, column, or any other construction
is in danger of falling, the owner shall be obliged to
demolish it or to execute the necessary work in order
to prevent it from falling. (CIVIL CODE, Art. 482, Par.
1).
If the proprietor does not comply with this obligation,
the administrative authorities may order the
demolition of the structure at the expense of the
owner, or take measures to insure public safety
(CIVIL CODE, Art. 482, Par. 2).
The complainant must show that his property is
adjacent to the dangerous construction, or must have
to pass by necessity in the immediate vicinity.
the entire land or thing. (Uy v. Estate of Vipa
Fernandez, G.R. No. 200612, April 5, 2017).
The nature of possession of a co–owner is like that of
a trustee and shall not be regarded as adverse to the
other co–owner but in fact beneficial to all of them
(Salvador v. CA, G.R. No. 109910, April 5, 1995).

Lack of knowledge of the falling condition of the
structure will not excuse the owner from liability.
The proprietor of a building or structure is responsible
for the damages resulting from its total or partial
collapse, if it should be due to the lack of necessary
repairs. (CIVIL CODE, Art. 2190).
For damages caused by defects in the construction,
the contractor is responsible for the damages within
15 years from the completion of the same (CIVIL
CODE, Art. 1723).
As the right of common dominion which two or more
persons have in a spiritual part of a thing not
materially or physically divided (Sanchez v. CA, GR
No. 108947, September 29, 1997).
REQUISITES: (POL)
1. Plurality of owners;
2. The Object of ownership must be a thing or right
which is undivided; and
3. Each co–owner’s right must be Limited only to his
ideal share of the physical whole (DE LEON,
Property, supra at 233).

AS TO TREES: CHARACTERISTICS: (PNoCS-LeG)

Whenever a large tree threatens to fall in such a way
as to cause damage to the land or tenement of
another or to travelers over a public or private road,
the owner of the tree shall be obliged to fell and
remove it; and should he not do so, it shall be done
at his expense by order of the administrative
authorities. (CIVIL CODE, Art. 483).
If damages were caused by the falling of trees
situated at or near highways or lanes, the owner of
the tree is liable for damages under the law on quasi-
delict if it is not caused by force majeure (CIVIL
CODE, Art. 2191, Par. 3).
1. Plurality of subjects/owners;
2. There is No mutual representation by the co–
owners;
3. It exists for the Common enjoyment of the co–
owners;
4. There is a Single object which is not materially
divided;
5. It has no distinct Legal personality; and
6. It is Governed first of all by the contract of the
parties; otherwise, by special legal provisions;
and in default of such provisions, by the
provisions of Title III on co–ownership (Id. at
234).

SOURCES: (C2LOST)
CO-OWNERSHIP 1.
2.
Contract;
Chance;
(ARTS. 484-501) 3. Law;
4. Occupation;
5. Succession; and
6. Testamentary disposition or donation inter vivos
CO-OWNERSHIP (Id. at 236-237).
There is co-ownership whenever the ownership of an
undivided thing or right belongs to different persons CO–OWNERSHIP V. PARTNERSHIP
(CIVIL CODE, Art. 484). CO–OWNERSHIP PARTNERSHIP
By the nature of co–ownership, a co–owner cannot As to Creation
point to any specific portion of the property owned in
common as his own because his share in it remains Can be created Can be created only by
intangible and ideal (Avila v. Sps. Barabat, G.R. No. without the formalities contract, express or
141993, March 17, 2006). of a contract. implied.

Before the partition of a land or thing held in common, As to Juridical Personality

no individual or co-owner can claim title to any
definite portion thereof. All that the co-owner has is Has no juridical or Has juridical personality
an ideal or abstract quota or proportionate share in legal personality. distinct from the partners.
 CO–OWNERSHIP PARTNERSHIP CO–OWNERSHIP JOINT OWNERSHIP

As to Purpose As to Right to Dispose Share

Purpose is collective Purpose is to obtain Each co-owner may Each joint-tenant cannot
enjoyment of the thing. profits. dispose of his ideal dispose of his own share
share without the without the consent of all
consent of the others. the others.
As to Disposition of Shares
As to Effect of Death
Co–owner can A partner, unless
dispose of his shares authorized, cannot In case of death, the In case of death, the
without the consent of dispose of his share and share of the co-owner share of the joint-tenant
the others with the substitute another as a descends to his goes or accrues to the
transferee partner in his place. estate. other joint-tenants.
automatically
becoming a co–owner. As to Prescription

As to Existence of Mutual Agency Prescription runs Prescription does not run

against all co-owners, against all the joint-
There is no mutual A partner can generally even if one of them tenants, if one of them is
representation. bind the partnership. happens to be a a minor or is under legal
minor. disability.
As to Distribution of Profits
(Id. at 237-238).
Distribution of profits Distribution of profits is
must be proportional subject to the stipulation RIGHTS OF EACH CO–OWNER AS TO
to the respective of the parties. THE THING OWNED IN COMMON:
interests of the co– (US-BRA-PLDP)
owners.
1. To Use the thing owned in common (CIVIL
As to Effect of Death or Incapacity CODE, Art. 486).

A co–ownership is not Death or incapacity Limitations:

dissolved by the death dissolves the partnership a. The co-owner must do so in accordance with
or incapacity of a co– the purpose for which it is intended; and
owner.
NOTE: Mere tolerance on the part of the co-
As to Formal Requisites owners cannot legalize the change in the use
of a thing from that intended by the parties.
No public instrument May be made in any form
needed even if real except when real b. In such a way as not to injure the interest of
property is the object property is contributed. the co-ownership or prevent the other co-
of the co–ownership.
owners from using it according to their rights
As to Agreement on the Period (CIVIL CODE, Art. 486).

An agreement to keep There may be agreement Illustration: A and B owned in common a two-
the thing undivided for as to a definite term story house. The upper floor was used as a
a period of more than without limit set by law. dwelling; the lower was available for rent by
ten (10) years is void. stores. If A, lives in a room on the upper floor, and
uses a room on the lower floor as an office, can
(Id. at 238-239). B demand rent?
a. No rent for the upper floor can be demanded,
CO-OWNERSHIP V. JOINT OWNERSHIP for A was exercising her right as co-owner,
CO–OWNERSHIP JOINT OWNERSHIP without prejudicing B who, had she wanted,
could have also lived in another room of said
As to Extent of Ownership floor, and who therefore could not have been
prejudiced.
Each co-owner owns Each joint-tenant and all b. Half-rental may be demanded for the use of
his ideal share in the of them own the whole the lower floor. Rent could be asked because
whole property. property. others could have rented the same, but only
half should be given because A was a co-
 owner (Pardell v. Bartolome, G.R. No. 4656,
November 18, 1912).
2. To Share in the benefits and charges in
proportion to the interest of each. Any
stipulation to the contrary is void (CIVIL
CODE, Art. 485).
REASON: It is contrary to the essence of co-
ownership (2 PARAS, supra at 323).
The interests of the co-owners are presumed
equal unless the contrary is proved (CIVIL
CODE, Art. 485).
NOTE: Art. 485 speaks of “stipulation in a
contract.” If the co-ownership is created other
than by a contract, such as by will or by donation,
the share of the co-owners need not be
proportionate to their respective interests (2
PARAS, supra at 322).
If a co-owner has paid the taxes to prevent
forfeiture of the common property for tax
delinquency, he could compel contribution from
his co-owners (Id. at 323).
3. To the Benefits of prescription:
prescription by one co–owner benefits all
(DE LEON, Property, supra at 267).
4. Repairs and taxes: Each co-owner shall
5. To consent to Alterations: None of the co-
have a right to compel the other co-
owners to contribute to the expenses of
the preservation of the thing or right
owned in common and to the taxes (CIVIL
CODE, Art. 488).
Repairs for preservation may be made at will of
one of the co-owners, but he must, if practicable,
first notify his co-owners of the necessity for such
repairs (CIVIL CODE, Art. 489).
The co-owners who should have been notified
will not be required to contribute to expenses
which are excessive. They may show, for
instance, that if the required notice had been
given, they could have obtained other means of
effecting the repairs which are not as costly as
that availed of by the co-owner who made or
ordered them (2 TOLENTINO, supra at 179).
Any one of the co-owners may exempt himself
from this obligation by renouncing so much of his
undivided interest as may be equivalent to his
share of the expenses and taxes (CIVIL CODE,
Art. 488).
NOTE: No such waiver shall be made if it is
prejudicial to the co-ownership (CIVIL CODE, Art.
488).
Renunciation is not allowed if the co-ownership
will be prejudiced, as in the case of a house which
is badly in need of repairs in order to prevent a
collapse, the waiver in this case is void, in which
case the other co-owner may proceed to have it
repaired, and the co-owner who has made a
previous renunciation would still be liable (2
TOLENTINO, supra at. 177).
Rules on Renunciation:
a. If the renunciation is in favor of the co-owner
creditor who has not yet been paid, said
creditor must give consent. This is a case of
dacion en pago;
b. If the renunciation is made in favor of the co-
owner/s, a novation (in the form of
substitution of debtor/ subjective novation)
would result. Thus, consent of said other co-
owner/s and of the creditor is required (2
PARAS, supra at 333).
Note: The creditor's consent would be needed
only if expenses have already been incurred,
otherwise, there would be as yet no creditor (DE
LEON, 2011, Property, supra at 245).
Reimbursement covers only necessary expenses
(2 PARAS, supra at 333).
owners shall, without the consent of the
others, make alterations in the thing
owned in common, even though benefits
for all would result therefrom (CIVIL CODE,
Art. 491).
However, if the withholding of the consent by one
or more of the co-owners is clearly prejudicial to
the common interest, the courts may afford
adequate relief (CIVIL CODE, Art. 491).
Alteration
An act by virtue of which a co–owner changes the
thing from the state in which the others believe it
should remain, or withdraws it from the use to
which they desire it to be intended. It is not limited
to material or physical changes (2 TOLENTINO,
supra at 192).
NOTE: However, it should not be understood to
include any change which a co-owner may make
in the common property, but only that which
modifies and limits, and above all, prejudices the
condition of the thing or its enjoyment by the
others (Id.).
 For the purpose of legalizing the alteration of the
common property, the consent may be either
express or tacit. A co-owner who knows the
alteration but does not interpose any objection is
deemed to tacitly consent to such alteration (Id.).
Effects of an Illegal Alteration:
A co-owner who makes alteration without the
express or implied consent of the other co-
owners acts in bad faith because he does so as
if he were the sole owner. Thus,
a. The co-owner responsible may lose what he
has spent;
b. Demolition can be compelled;
c. He would be liable for losses and damages;
and
d. Whatever benefits the co-ownership derives
will belong to it (3 MANRESA as cited in 2
PARAS, supra at 349).
6. To Protest against seriously prejudicial
decisions of the majority (CIVIL CODE, Art.
492).
7. Legal redemption: to be exercised within
30 days from written notice of sale of an
undivided share of another co–owner to a
stranger (CIVIL CODE, Arts. 1620 and 1623).
8. To Defend the co–ownership’s interest in
court (DE LEON, Property, supra at 253-255).
Anyone of the co-owners may bring an action for
ejectment (CIVIL CODE, Art. 487).
Art. 487 allows a co-owner to bring an action for
ejectment which covers all kinds of actions for the
Recovery of Possession, including Forcible Entry
and Unlawful Detainer, without the necessity of
joining all the other co-owners as co-plaintiffs
because it is deemed to be instituted for the
benefit of all (2 PARAS, supra at 329; Heirs of
Ampil v. Manahan, G.R. No. 175990, October 11,
2012).
Only one of the co-owners, namely the co-owner
who filed the suit for the recovery of the co-owned
property, is an indispensable party thereto. The
other co-owners are not indispensable parties.
They are not even necessary parties, for a
complete relief can be afforded in the suit even
without their participation, since the suit is
presumed to have been filed for the benefit of all
co-owners (Catedrilla v. Lauron, G.R. No.
179011, April 15,2013).
If the action is for the benefit of the plaintiff alone,
such that he claims the possession for himself
and not for the co-ownership, the action will not
prosper (Adlawan v. Adlawan, G.R. No. 161916).
9. To demand Partition at any time (CIVIL
CODE, Art. 494).
GENERAL RULE: Partition is demandable by
any of the co–owners as a matter of right at any
time (CIVIL CODE, Art. 494).
EXCEPTIONS: (SC-LUPA)
a. When there is a Stipulation against it; but not
to exceed 10 years. However, the term may
be extended as many times as the co-owners
may stipulate but every extension must not
exceed 10 years (CIVIL CODE, Art. 494);
b. When the Condition of indivision is imposed
by the donor or testator; but not to exceed 20
years (CIVIL CODE, Art. 494);
c. When the Legal nature of the community
prevents partition;
d. When partition would render the thing
Unserviceable (CIVIL CODE, Art. 495);
e. When partition is Prohibited by law (CIVIL
CODE, Art. 494); and
f. When Another co–owner has possessed the
property as an exclusive owner for a period
sufficient to acquire it by prescription.
PERPENDICULAR OWNERSHIP
One where the different stories of a building belong
to different persons, as distinguished from an
ordinary case of co-ownership where all the floors
and everything else belong to all co-owners (CIVIL
CODE, Art. 490).
NOTE: The above form of ownership is different from
condominium (DE LEON, Property, supra at 252). A
horizontal co-ownership is one where various units
are in one plane as when one-story units all set on
the ground (2 PARAS, supra at 332).
RULES IN THE ABSENCE OF CONTRARY
PROVISION IN THE TITLES OF
OWNERSHIP OR AGREEMENT (CIVIL
CODE, Art. 490):
1. Proportionate contribution is required for the
preservation of:
a. The main walls;
b. The party walls;
c. The roof; and
d. Other things or areas used in common.
2. Each floor owner must bear the expenses of his
floor.
3. Expenses of all owners pro rata:
a. The floor of the entrance;
b. The front door;
 c. The common yard;
d. Sanitary works common to all; and
e. Stairs from the entrance to the first story.
4. Stairs are to be maintained from story to story, by
the users (stairs from entrance to first story at the
expense of all owners aside from the owner of the
ground floor, the stairs from the second story at
the expense of all except the owner of the ground
floor and first story, and so on).
NOTE: Ground floor, if any, is distinguished from
the first story (2 PARAS, supra at 337).
Ground Floor – The floor of a building most nearly
on a level with the ground (MERRIAM-
WEBSTER, 2017).
First Floor – The floor next above the ground floor
(Id.).
THE FOLLOWING QUESTIONS ARE
DETERMINED BY THE MAJORITY OF
INTERESTS:
1. Administration or Management;
Characteristics:
a. Those that do not involve an alteration;
b. Are renewable from time to time;
c. Do not bind the community for a long time in
the future (transitory effect);
d. Do not give rise to a real right over the thing
owned in common (REYES-PUNO,
Philippine Civil Law, supra at 73);
e. Do not affect the substance or nature of the
thing; and
f. For the common benefit of all (2 PARAS,
supra at 357).
NOTE: Minority may appeal to the court against
the majority’s decision if the same is seriously
prejudicial (CIVIL CODE, Art. 492).
ADMINISTRATION V. ALTERATION
ADMINISTRATION ALTERATION
As to Nature
Refers to the enjoyment Has a more permanent
of a thing and is of a result and relate to the
transitory character. substance or form of
the thing.
As to Necessity of Modification
When nature of a thing When nature of the
requires modification or thing does not require
changes (such as an modification or
industry or business),
modifications made are changes, modifications
simple administration. made are alterations.
(2 TOLENTINO, supra at 195).
2. Enjoyment; and
3. Improvement or embellishment (DE LEON,
Property, supra at 255).
Majority
Consists of co-owners who represent the controlling
interest in the object of the co-ownership (CIVIL
CODE, 492) i.e., at least more than 50% of the
financial interest (DE LEON, Property, supra at 256).
LIMITATIONS:
1. Before a decision is made, there should first be a
notice to the minority so that they can be heard;
2. The majority would be justified in proceeding only
when the urgency of the case and the difficulty of
meeting with them render impracticable the
giving of such notice; and
3. Minority may appeal to the court when:
a. There is no real majority;
b. Decision is seriously prejudicial to individual
rights of co-owners;
c. There is fraud;
d. Alteration is agreed upon; and
e. Refusal to correct abuse of administration
(2 PARAS, supra, at 357).
ACTIONS REQUIRING THE CONSENT
OF CO-OWNERS
ACTIONS CONSENT NEEDED
Repairs, ejectment One co-owner (CIVIL
actions CODE, Art. 489)
Alterations or Acts of All of the co-owners
Ownership (CIVIL CODE, Art. 491)
All others (e.g. useful Financial majority of the
improvements, co-owners (CIVIL
embellishments, CODE, Arts. 489 and
administration and 492).
better enjoyment).
RIGHTS AS TO THE IDEAL SHARE OF
EACH CO–OWNER (CIVIL CODE, ART.
493)
1. Each has full ownership of his part and of his
share of the fruits and benefits;
2. Right to substitute another person in its
enjoyment, EXCEPT when personal rights are
involved or for the purpose of giving the thing a
different use from that agreed upon;
 Personal rights – used in its real meaning and not
in its legal or technical sense; it is the right which
cannot be transferred because it affects the
personal relations of the co-owners with one
another.
3. Right to alienate, assign, or mortgage, dispose or
encumber;
4. Right to exempt himself from necessary
expenses and taxes by renouncing part of his
interest in the co-ownership (2 PARAS, supra at
359-360); and
5. He may demand partition of the thing owned in
common, in so far as his share is concerned
(DE LEON, Property, supra at 257).
NOTE: This right is without prejudice to the
exercise by the others of the right of legal
redemption under Art. 1620.
SALE OR MORTGAGE OF COMMON
PROPERTY
1. Undivided portion
– transferee does not acquire any specific or
determinate physical portion of the whole
property (Id. at 258).
2. Definite portion
– valid; subject to the interest of the vendor (Id. at
259).
3. Whole property
– valid only insofar as the co-owner’s share is
concerned, unless the sale is authorized by the
other co-owners’ right to renounce part of his
interest to reimburse necessary expenses
incurred by another co–owner (Id. at 260).
4. Transactions entered into by each co–
owner only affect his ideal share (Id.).
When a co-owner sells the whole property as his,
the sale affects only the seller’s share pro indiviso
and the transferee gets only what corresponds to
his grantor’s share in the partition of the property
owned in common. Since a co-owner is entitled
to sell his undivided share, a sale of the entire
property by one co-owner without the consent of
the other co-owners is not null and void; only the
rights of the co-owners/seller are transferred,
thereby making the buyer a co-owner of the
property (Oesmer v. Paraiso Development Corp.,
G.R. No. 157493, February 5, 2007).
The effect of the alienation or the mortgage, with
respect to the co-owners, shall be limited to the
portion which may be allotted to him in the
division upon the termination of the co-ownership
(Magsano v. Pangasinan Savings and Loan
Bank, Inc., G.R. No. 215038, October 17, 2016).
In such cases, the remedy is to ask for partition,
not to ask for the nullity of the sale (Aguirre, et. al
v.CA, G.R. No. 122249, January 29, 2004).
Forged Special Power of Attorney to mortgage a
real property made by a co-owner shall be valid
only insofar as the share of the forging co-owner
(Rural Bank of Cabadbaran, Inc. v. Melecio-Yap,
G.R. No. 178451, July 30, 2014).
DONATION OF CONJUGAL PROPERTY
The spouses are the absolute owners of their
undivided one-half interest over a conjugal property.
The donation by one spouse of a conjugal property
without the consent of the other spouse will transfer
title only to the extent of the one-half undivided
portion of that property by the donor-spouse. The
donation is not wholly void ab initio. Accordingly,
vendees in the subsequent sale of the subject
property, is confined only to the one-half undivided
portion thereof (Spouses Carlos v. Tolentino, G.R.
No. 234533, June 27, 2018).
RIGHT OF A CO-OWNER TO DEMAND
PARTITION
No co-owner shall be obliged to remain in the co-
ownership. Each co-owner may demand at any time
the partition of the thing owned in common, insofar as
his share is concerned (CIVIL CODE, Art.494).
REASONS:
1. Law discourages co-ownership; and
2. To remain in the co-ownership is to subject a
person to the desires of the rest; conflicts in
management being bound to arise (2 PARAS,
supra at 362).
PROHIBITION TO PARTITION BECAUSE
OF AN AGREEMENT (CIVIL CODE, Art.494):
1. Period must not extend more than 10 years;
2. If it exceeds 10 years, the stipulation is valid only
insofar as the first 10 years;
3. There can be an extension but only after the
original period has expired; and
4. After the first extension, there can be another,
and so on indefinitely, as long as for each
extension, the period of 10 years is not exceeded
(3 MANRESA as cited in 2 PARAS, supra at 362).
PARTITION
Partition is the separation, division, and assignment
of a thing held in common among those to whom it
may belong. It may be effected extrajudicially by the
heirs themselves through a public instrument filed
before the register of deeds (Espinas-Lanuza v.
Luna, Jr., G.R. No. 229775, March 11, 2019).
An action for partition is at once an action for
declaration of co-ownership and for segregation and
conveyance of a determinate portion of the properties
involved (Balo v. CA, G.R. No. 129704, September
30, 2005).
REASON: The policy of the law is not to favor co-
ownership because it is not conducive to the
development of the community property particularly
where it involves real estate (DE LEON, Property,
supra at 272).
NOTE: The thing itself may be physically divided, or
if not, its value may be partitioned (7 MANRESA as
cited in 2 PARAS, supra at 362; Art. 1079). Partition
is governed primarily by the Civil Code and
suppletorily by the pertinent provisions of the Rules
of Court particularly Rule 69.
GENERAL RULE: Under Art. 494, Par. 5 of the Civil
Code, prescription does not run in favor of or against
a co-owner or co-heir.
REASON: Possession of the co-owner or co-heir is
ordinarily not adverse to the others, but, in fact,
beneficial to all of them. The possession of a co-
owner is similar to that of a trustee (DE LEON,
Property, supra at 267).
EXCEPTION: Where a co-owner or co-heir
repudiates the co-ownership or co-heirship,
prescription begins to run from the time of
repudiation, subject to the concurrence of following
conditions: (PUKE)
1. His Possession is open, continuous, exclusive,
and notorious;
2. The co-owner has performed Unequivocal acts of
repudiation amounting to an ouster of the other
co-owners;
3. Such positive acts of repudiation have been
made Known to the other co-owners; and
4. The Evidence thereof is clear and convincing
(Robles v. CA, G.R. No. 123509, March 14,
2000).
NOTE: A co-owner cannot, without the conformity of
the other co-owners or a judicial decree pursuant to
Rule 69 of the Rules of Court, adjudicate to himself in
fee simple a determinate portion of the lot owned in
common, to the exclusion of other co-owners (Del
Blanco v. IAC, G.R. No. 72694, December 1, 1987).
An agreement of partition, though oral, is valid and
consequently binding upon the parties (Caro v. CA,
G.R. No. L-46001, March 25, 1982).
As between the parties, a public instrument is neither
constitutive nor an inherent element of a contract of
partition. Since registration serves as constructive
notice to third persons, an oral partition by the heirs
is valid if no creditors are affected. Moreover, even
the requirement of a written memorandum under the
statute of frauds does not apply to partitions effected
by the heirs where no creditors are involved
considering that such transaction is not a conveyance
of property resulting in change of ownership but
merely a designation and segregation of that part
which belongs to each heir (Espinas-Lanuza v. Luna,
Jr., G.R. No. 229775, March 11, 2019).
Mere receiving of rents or profits, payment of taxes,
or construction of a fence or building would not be
sufficient proof of exclusive or adverse possession
because anyone in the co-ownership may do it
(Laguna v. Levantino, G.R. No. L-47386, April 18,
1941).
The act of executing the affidavit of self–adjudication
did not constitute sufficient act of repudiation. In fact,
there was bad faith of the co–heir in feigning sole
ownership of the property to the exclusion of the other
co–heirs (Galvez v. CA, G.R. No. 157954, March 24,
2006).
While it is true that registration under the Torrens
system is constructive notice of title, the Torrens title
does not furnish a shield for fraud. Thus, where one
registered the property in question in his name in
fraud of his co–heirs, prescription can only be
deemed to have commenced from the time the latter
discovers the fraudulent act (Adille v. CA, G.R. No. L-
44546, January 29, 1988).
Redemption of the whole property by the co-owner
does not vest in him sole ownership over the said
property. Redemption duly made within the period
prescribed by law inures to the benefit of the co-
ownership and does not put an end to its existence
(Mariano v. CA, G.R. No. 101522, May 28, 1993).
RIGHTS/PARTICIPATION OF
CREDITORS AND ASSIGNEES OF THE
CO-OWNERS IN THE PARTITION (CIVIL
CODE, ART. 497)
1. Scope of Creditors or Assignees
As the law does not distinguish, creditors include
all kinds of creditors provided they became so
during the existence of the co-ownership.
Assignees are transferees of interests of one or
more of the co-owners (DE LEON, Property,
supra at 277).
 Illustration: A, B, and C are co-owners. A sold
his share to X. Who is entitled to participate in the
partition, A or X?
Answer: It depends.
a. If A had sold his whole interest, and has
delivered same, then X should participate (X
is participating as a co-owner).
b. If A had sold only part of his share, or even
if he sold his entire share, he has not yet
delivered same to X, both A and X are
allowed to participate in the partition. (A
participating as co-owner and X as assignee)
(2 PARAS, supra at 382 - 383).
2. Right of notice of partition
While the law does not expressly require
previous notice of the proposed partition be given
to the creditors and assignees, since they are
granted the right to participate, they have also the
right to be notified thereof, such that in the
absence of such notice, the partition will not be
binding on them (De Santos v. Bank of the
Philippine Islands, G.R. No. 44065, July 30,
1938).
3. Right to object to or impugn
a. If notice is given, it is their duty to appear and
make known their position; they may concur
with proposed partition or object to its being
affected.
b. If no notice is given, the creditors or
assignees may question the partition already
made (DE LEON, Property, supra at 278-
279).
However, they cannot impugn any partition
already executed, unless:
a. There has been fraud; or
b. The partition was made notwithstanding a
formal opposition presented to prevent it
(CIVIL CODE, Art. 497).
NOTE: The debtor or assignor has always the
right to maintain its validity of the partition (DE
LEON, Property, supra at 279).
PARTITION IN CASE CO-OWNERS
CANNOT AGREE/THING IS
ESSENTIALLY INDIVISIBLE (CIVIL CODE,
ART. 498)
Whenever the thing is essentially indivisible and
the co-owners cannot agree:
Firstly, the property may be adjudicated to one of the
co-owners, who shall indemnify the other.
Otherwise, it shall be sold, and the proceeds
distributed (DE LEON, Property, supra at 280).
NOTE: The sale shall be resorted to only when the
property cannot be divided without prejudice to the
co-owners, and the co-owners cannot agree (DE
LEON, supra at 267).
PROTECTION ON THE RIGHTS OF THIRD
PERSONS
The partition of a thing owned in common shall not
prejudice third persons, who shall retain the rights of
mortgage, servitude or any other real rights belonging
to them before the division was made. Personal rights
pertaining to them against the co-ownership shall
also remain in force, notwithstanding the partition
(CIVIL CODE, Art. 499).
EFFECTS OF PARTITION (CIVIL CODE,
ARTS. 500 AND 501)
1. Mutual accounting for the benefits received
(CIVIL CODE, Art. 500);
2. Mutual reimbursements for expenses (i.e.,
necessary expenses, taxes, and others in proper
cases) (CIVIL CODE, Art. 500);
3. Indemnity for damages caused in case of
negligence or fraud (CIVIL CODE, Art. 500);
4. Reciprocal warranty for defects of title or quality
of the portion assigned to a co-owner (CIVIL
CODE, Art. 501);
5. Each former co-owner is deemed to have had
exclusive possession of the part allotted to him
for the entire period during which the co-
possession lasted (CIVIL CODE, Art. 543); and
6. Partition confers upon each, the exclusive title
over his respective share (CIVIL CODE, Art.
1091).
GROUNDS FOR THE EXTINGUISHMENT
OF CO-OWNERSHIP: (JEx-CoS-M-LEx-
T2)
1. Judicial partition;
2. Extrajudicial partition;
NOTE: The possession of a co-owner cannot
ripen into ownership because the possession is
merely in the concept of a trustee for the other
co-owners (Salvador v. CA, G.R. No. 55691, May
21, 1992).
There is juridical dissolution of co-ownership
when the thing is sold, either publicly or privately,
to a third person (Republic v. Baltazar-Ramirez,
GR. No. 148103, July 27, 2006).
3. When by prescription, one Co-owner has
acquired the whole property by adverse
possession as against all the others, and
repudiating unequivocally the ownership of the
other;
4. When a Stranger acquired by prescription the
thing owned in common;
5. Merger in one co-owner;
6. Loss or destruction;
7. Expropriation (PARAS, Property, supra at 348);
8. By the Termination of the period agreed upon or
imposed by the donor or testator, or of the period
allowed by law (CIVIL CODE, Art. 494, Pars. 2
and 3); and
9. By the sale by the co-owners of the thing to a
Third person and the distribution of its proceeds
among them (CIVIL CODE, Art. 498).
SOME SPECIAL
PROPERTIES
(ARTS. 502-522)
WATERS (CIVIL CODE, Arts. 502-518)
Laws Governing Waters:
1. Civil Code of the Philippines;
2. Spanish Law on Waters of August 3, 1866;
3. The Irrigation Acts, Act 2152 and its
amendments;
4. Water Power Act No. 4062;
5. Art. XII, Sec. 2 of the 1987 Constitution; and
6. Water Code of the Philippines (P.D. No. 1067).
Classification:
1. Waters public per se (water is the principal); the
bed follows the character of the water.
Running water (CIVIL CODE, Art. 502).
2. Waters public or private according to their bed
(water is accessory to bed).
a. Subterranean waters (CIVIL CODE, Arts.
502 and 503);
b. Subterranean waters rising to the surface
continuously or intermittently (CIVIL CODE,
Arts. 502 and 503);
c. Non-running water (CIVIL CODE, Arts. 502
and 503); and
d. Rain water (CIVIL CODE, Arts. 502 and 503).
3. Waters public by special provision.
a. Waters within the zone of public works, even
if constructed under a contract (CIVIL CODE,
Art. 502);
b. Private water after leaving the estate of origin
(CIVIL CODE, Arts. 502, 507 and 514); and
c. Waste water of fountains, sewers, and public
establishments (CIVIL CODE, Art. 502).
MINERALS (CIVIL CODE, Art. 519)
Laws Governing Minerals:
1. Before 1902: R.D. Sobre Mineria 1867;
2. Between 1902-1906: The Philippine Bill of 1902
and Legislative Acts;
3. Art. XII of the 1987 Constitution; and
4. Present: Mineral Resources Development
Decree of 1974 (P.D. No. 463) and the Civil Code
of the Philippines.
Minerals
All inorganic substances found in nature, whether in
solid, liquid, gaseous, or any intermediate state, with
the exception of soil which supports the organic life,
and of ordinary earth, gravel, sand, and stone which
are used for building or construction purposes (C.A.
No. 137, Sec. 7).
Mineral Lands
Are those in which minerals exist in sufficient quantity
or quality to justify the necessary expenditures to be
incurred in extracting and utilizing such materials
(P.D. No. 463, Sec. 2).
TRADEMARK AND TRADE NAMES (CIVIL
CODE, Arts. 520 and 523)
Mark
Is any visible sign capable of distinguishing the goods
or services of an enterprise and shall include a
stamped or marked container of goods (R.A. No.
8293, Sec. 121).
Service mark is used in the sale or advertising of
services to identify the services of one person and
distinguish them from services of others, and includes
without limitation the marks, names, symbols, titles,
designations, slogans, character names, distinctive
features of radio or other advertising (DE LEON,
Property, supra at 327).
Trade Name
Is a name or designation identifying or distinguishing
an enterprise (R.A. No. 8293, Sec. 121).
Laws Governing Trademarks and Trade names:
1. Intellectual Property Code (R.A. No. 8293); and
2. Civil Code of the Philippines

POSSESSION
(ARTS. 523-561)
CONCEPT:
1. As an act
– (holding) the holding of a thing or the enjoyment
of a right with the intention to possess in one’s
own right (CIVIL CODE, Art. 523).
2. As a fact
– (existence) when there is holding or enjoyment
(CIVIL CODE, Art. 523).
The fact of possession gives rise to certain rights
and presumptions, such as the right to be
respected in his possession, and should he be
disturbed therein, he shall be protected in or
restored to said possession (CIVIL CODE, Art.
539).
Possession is not a definitive proof of ownership
nor is non-possession inconsistent therewith
(Heirs of G. Bofill v. CA, G.R. No. 107930,
October 7, 1994). It is well-established that
ownership and possession are two entirely
different legal concepts (Heirs of Spouses Arcilla
v. Teodoro, G.R. No. 162886, August 11, 2008).
3. As a right
– (consequences) the right of a person to hold or
enjoy to the exclusion of all others having better
right than the possessor.
a. Jus possidendi– right to possession which
is incidental to or included in the right of
ownership. (e.g., I own a house; therefore, I
am entitled to possess it) (PARAS, supra at
456); or
b. Jus possessionis – right of possession
independent from the right of ownership.
(e.g., I am renting a house form C. Although
I am not the owner, still by virtue of the lease
contract, I am entitled to possess the same)
(Id.).
Requisites (RIO):
i. Occupancy, apprehension, or taking of a
thing or right (possession in fact) which
may be actual or constructive (Id. at
457);
ii. Deliberate Intention to possess (animus
possidendi); and
NOTE: An insane or demented person
cannot acquire possession as they are
incapable of understanding the import of
their actions (Id.).
iii. By virtue of one’s own Right – in his own
name or in that of another (Id.).
POSSESSION DISTINGUISHED FROM
OWNERSHIP
1. A person may be declared the owner but he may
not be entitled to possession.
2. A person may have introduced improvements
thereon of which he may not be deprived without
due hearing. He may have other valid defenses
to resist surrender of possession.
3. Judgment for ownership does not necessarily
include possession as a necessary incident. (Id.
At 458).
There is ownership when a thing pertaining to one
person is completely subjected to his will in a manner
not prohibited by law and consistent with the rights of
others. Possession is the holding of a thing or the
enjoyment of a right. Literally, to possess means to
actually and physically occupy a thing with or without
right (DE LEON, Property, supra at 325).
DEGREES:
1. Grammatical Degree
Possession without any title whatsoever – mere
holding without any right at all (e.g., thief or
squatter) (Id. at 339);
2. Juridical Possession
Possession with juridical title – predicated on
juridical relation existing between the possessor
and the owner (e.g., lessee, usufructuary,
depositary, agent, pledgee and trustee) (Id.);
3. Real Possessory Right
Possession with just title – the possession of an
adverse claimant whose title is sufficient to
transfer ownership but is defective (e.g., when
the seller is not the true owner or could not
transmit his rights thereto to a possessor who
acted in good faith) (Id.); or
4. Dominium
Possession with a title in fee simple – derived
from the right of dominion or possession of an
owner; the highest degree of possession (Id.).
CLASSES:
1. According to Names under which
Possession May be Exercised
a. In one’s own name (CIVIL CODE, Art. 524) –
where possessor claims the thing for himself;
and
 b. In the name of another (CIVIL CODE, Art.
524) – for whom the thing is held by the
possessor.
i. Voluntary – as when an agent possesses
for the principal (by virtue of an
agreement);
ii. Necessary or Legal – when exercised by
virtue of law, such as possession in
behalf of incapacitated persons, a
mother for her child and juridical entities;
or
iii. Unauthorized – This will become the
principal’s possession only after there
has been ratification without prejudice to
the effects of negotiorum gestio (2
PARAS, supra at 461).
NOTE: Landlord is in actual possession
through the tenant. Hence, he can also bring
a suit against an intruder (Simpao v. Dizon,
G.R. No. 452, April 30, 1902).
2. According to the Concept of Possession
a. In the concept of owner (enconcepto de
dueno) – possessor of thing or right, by his
actions, is considered or believed by others
as the owner, regardless of good or bad faith
of the possessor, recognizing no title of
ownership in another (CIVIL CODE, Art.
525).
Only the possession acquired and enjoyed in
the concept of owner can serve as a title for
acquiring dominion (CIVIL CODE, Art. 540).
Such possessor is presumed to possess just
title and cannot be obliged to show or prove
it (CIVIL CODE, Art. 541).
NOTE: It is essential that such flaw or defect
in the title must be such that it will have the
effect of invalidating the title. If flaw or defect
does not result in invalidation of title, he is not
merely a possessor in good faith but the
owner. The phrase possessor in good faith
presupposes ownership of another (Pershing
Tan Cueto v. CA, G.R.No. L-35648, February
27, 1987).
The Court unequivocally stated that laches
can only apply to one whose possession of
the property was open, continuous,
exclusive, adverse, notorious, and in the
concept of an owner for a prolonged period
of time. Additionally, physical possession
must be coupled with intent to possess as an
owner in order for it to be considered as
adverse. Therefore, the petitioner's claim that
their possession of the subject lot was
adverse and in the concept of an owner, must
fail. Being the owners of the subject property,
respondents have the right to recover
possession from the petitioner because such
right is imprescriptible. Even if the
Department of Education has been
occupying the subject property for a
considerable length of time, respondents, as
lawful owners, have the right to demand the
return of their property at any time as long as
the possession was only through mere
tolerance (Department of Education vs. Heirs
of Banguila, G.R. No. 230399, June 20,
2018).
b. In the concept of holder, possessor holds it
merely to keep or enjoy it, the ownership
pertaining to another person (CIVIL CODE,
Art. 525).
Possessor acknowledges in another a
superior right which he believes to be
ownership, whether his belief be right or
wrong (Carlos v. Republic, G.R. No. 164823,
August 31, 2005).
NOTE: There can be possession in concept
of both owner and holder or in neither (DE
LEON, Property, supra at 334).
Although the taxable person who has actual
and beneficial use and possession of a
property may be charged with the payment of
unpaid realty tax due thereon, such
assumption of liability does not clothe the
said person with the legal title or interest over
the property. To rule otherwise would be to
defeat the true owner's rights by allowing
lessees or other occupants of a property to
assert ownership by the simple expedient of
redeeming the same at a tax delinquency
sale (Onstott v. Upper Tagpos Neighborhood
Association Inc., G.R. No. 221047,
September 14, 2016).
3. According to the Condition of the Mind
a. In good faith, the possessor is not aware that
there is in his title or mode of acquisition a
flaw that invalidates it (CIVIL CODE, Art.
526).
Requisites: (OVI)
i. Ostensible title or mode of acquisition;
ii. Vice or defect in the title; and
iii. Possessor is Ignorant of the vice or
defect and must have an honest belief
that the thing belongs to him (CIVIL
CODE, Art. 526).
 Mistake upon a doubtful or difficult question
of law may be the basis of good faith (CIVIL
CODE, Art. 526).
Mistake upon a doubtful or difficult question
of law, which may be the basis of good faith
under Art. 526, refers to honest error in the
application of the law or interpretation of
doubtful or conflicting legal provisions or
doctrines, but is different from “ignorance of
the law,” as when a person acquired property
by a deed which is absolutely void because it
is in violation of prohibitory laws (DE LEON,
Property, supra at 351).
b. In bad faith (CIVIL CODE, Art. 526) –
possessor is aware of the flaw that
invalidates his title.
Bad faith does not simply connote bad
judgment or negligence; it contemplates a
state of mind affirmatively operating with
furtive design or some motive of self-interest
or ill-will for ulterior purposes (Villanueva v.
Sandiganbayan, G.R. No. 105607, June
21,1993).
Only personal knowledge of the flaw in one’s
title or mode of acquisition can make him a
possessor in bad faith. It is not transmissible
even to an heir (DE LEON, Property, supra
at 354).
The distinction between possession in good
faith and possession in bad faith is of
importance principally in connection with the
receipt of fruits and the payment of expenses
and improvements under Arts. 544 – 553;
and the acquisition of ownership by
prescription under Art. 1127. However, such
distinction is immaterial in the exercise of the
right to recover under Art. 539 which speaks
of every possessor (Id. at 347).
Bad faith is personal. Just because a person
is in bad faith does not mean that his
successors-in-interest are also in bad faith
(Id. at 364).
A lessee who continues to stay on the
premises after the expiration of the lease
contract is deemed a usurper; as such he has
become a possessor in bad faith (Republic v.
Diaz, G.R. No. L-36486, August 6, 1979).
Possession in good faith is converted to
possession in bad faith from the moment
facts exist showing the possessor’s
knowledge of the flaw (CIVIL CODE, Art.
528).
Article 528 of the New Civil Code provide that
possession acquired in good faith does not
lose his character, except in a case and from
the moment facts exist which show that the
possessor is not unaware that he possesses
the thing improperly or wrongfully.
Possession in good faith ceases from the
moment defects in the title are made known
to the possessors, by extraneous evidence or
by suit for recovery of the property by the true
owner. Whatever may be the cause or the
fact from which it can be deduced that the
possessor has knowledge of the defect of his
title or mode of acquisition, it must be
considered sufficient to show bad faith (Pen
Development Corporation and Las Brisas
Resort Corporation vs. Martinez Leyba Inc.,
G.R. No. 211845, August 9, 2017).
In the absence of other facts showing the
possessors knowledge, good faith is
interrupted from the receipt of service of
judicial summons (DE LEON, Property,
supra at 354).
If date of service of summons cannot be
determined, then good faith is deemed
interrupted at the date of filing an answer
(Id.).
EXTENT OF POSSESSION:
1. Actual possession
– Occupancy in fact of the whole or at least
substantially the whole property; and
2. Constructive possession
– Occupancy of part, in the name of the whole,
under such circumstances that the law extends
the occupancy to the possession of the whole (Id.
at 340).
DOCTRINE OF CONSTRUCTIVE
POSSESSION
Possession in the eyes of the law does not mean that
a man has to have his feet on every square meter of
ground before it can be said that he is in possession
(Ramos v. Director of Lands G.R. No. 13298,
November 19, 1918).
Possession can be acquired not only by material
occupation, but also by the fact that a thing is subject
to the action of one's will or by the proper acts and
legal formalities established for acquiring such right.
Possession can be acquired by juridical acts. These
are acts to which the law gives the force of acts of
possession. In one case, this Court has considered a
claimant's act of assigning a caretaker over the
disputed land, who cultivated the same and built a hut
thereon, as evidence of the claimant's possession of
the said land (Municipal Rural Bank of Libmanan,
Camarines Sur v. Ordoñez, G.R. No. 204663, ACQUISITION OF
September 27, 2017).
POSSESSION
Jurisprudence states that the law does not
require a person to have his feet on every square
(ARTS. 531-538)
meter of the ground before it can be said that he
is in possession thereof. In Bunyi vs. Factor, the
Court held that "visiting the property on
ESSENTIAL REQUIREMENTS FOR
weekends and holidays is evidence of actual or
physical possession. The fact of her residence ACQUIRING POSSESSION: (CI)
somewhere else, by itself, does not result in loss 1. Corpus (or thing physically detained); and
of possession of the subject property” (Spouses 2. Intent to possess (expressly or impliedly) (DE
Fahrenbach v. Pangilinan, G.R. No. 224549, LEON, Property, supra at 337).
August 8, 2017).
MANNER OF ACQUIRING POSSESSION
PRESUMPTIONS IN FAVOR OF THE (CIVIL CODE, ART. 531):
POSSESSOR: 1. Material occupation of the thing or
1. Good faith (CIVIL CODE, Art. 527); exercise of a right
2. Continuity of initial good faith (CIVIL CODE, Art. – Includes both actual delivery and constructive
528); delivery (traditio brevi manu and constitutum
3. Enjoyment in the same character in which possessorium);
possession was acquired until the contrary is
proved (CIVIL CODE, Art. 529); 2. Subjection to our will
4. Non–interruption in favor of the present – This includes tradition longa manu and traditio
possessor (CIVIL CODE, Art. 554) and of symbolica; or
hereditary property (CIVIL CODE, Art. 533);
5. Continuous possession by the one who recovers 3. Proper acts and legal formalities
possession of which he was wrongfully deprived established for acquiring such right
(CIVIL CODE, Art. 561); (DE LEON, Property, supra at 358).
6. Extension of possession of real property to all
movables contained therein (CIVIL CODE, Art.
542);
RULES IN THE ACQUISITION OF
7. Just title (CIVIL CODE, Art. 541); POSSESSION:
8. Continuity of possession of property unjustly lost 1. Personally or by the same person who is to enjoy
but legally recovered (CIVIL CODE, Art. 561); it;
9. Possession during intervening period (CIVIL Requisites (ICO):
CODE, Art. 1138, Par. 2); and a. Intent to possess;
10. Exclusive possession of common property by b. Capacity to possess; and
each one of the participants of their allotted share c. Object must be capable of being possessed
upon division (CIVIL CODE, Art. 543).
2. Through an authorized person or by his legal
OBJECT OF POSSESSION representative or agent; and
Requisites (PIA):
GENERAL RULE: All things and rights susceptible of
a. Intent to possess for principal;
being appropriated may be the object of possession
b. Authority or capacity to possess; and
(CIVIL CODE, Art. 530).
c. Principal has intent and capacity to possess.
EXCEPTIONS: (PREP)
3. Through an unauthorized person or by any
1. Property of public dominion;
persons without any power or authority
2. Res communes;
whatsoever.
3. Easement; and
Requisites (RIC):
4. Prohibited by law (2 PARAS, supra at 482).
a. Intent to possess for another – principal;
b. Capacity of principal to possess; and
c. Ratification by principal (2 PARAS, supra at
486).

NOTE: In No. 3, possession shall not be considered

as acquired until the person in whose name the act of
possession was executed has ratified the same,
without prejudice to the juridical consequences of
negotiorum gestio in the proper case (Id.).
ACQUISITION BY SUCCESSION (MORTIS
CAUSA)
The rights to succession are transmitted from the
moment of the death of the decedent. (CIVIL CODE,
Art. 777).
1. Time of Acquisition – If the inheritance is
accepted, the estate is transmitted without
interruption from the death of the predecessor.
But the heir who repudiates is deemed never to
have acquired possession (CIVIL CODE, Art.
533).
Note: An heir can sell whatever right, interest or
participation he may have in the property under
administration, subject to the result of said
administration (DE LEON, Property, supra at
362).
From the moment of death of the decedent, each
of his heirs becomes the undivided owner of the
whole estate left with respect to that portion
which might be adjudicated to him (Id.).
2. If the inheritance is validly renounced, the heir
is deemed never to have possessed the same
(CIVIL CODE, Art. 533).
3. Effect of bad faith of the decedent – One who
succeeds by hereditary title shall not suffer the
consequences of the wrongful possession of the
decedent unless it is shown that he had
knowledge of the defects affecting it; but the
effects of possession in good faith shall not
benefit him except from the death of the decedent
(CIVIL CODE, Art. 534).
Tacking of Possession: The latter part of Art
534 is not applicable if the father (or decedent)
had been in good faith, for the son (or heir) would
not suffer. In such a case, the possession of the
father in good faith is added to the possession of
the son in good faith, and we cannot say that the
effects of possession in good faith shall
commence only from the decedent’s death.
ACQUISITION BY MINORS AND
INCAPACITATED PERSONS
Minors and incapacitated persons may acquire the
possession of things, but they need the assistance of
their legal representatives in order to exercise the
rights which from the possession arise in their favor
(CIVIL CODE, Art. 535).
NOTE: Minors and incapacitated persons may
acquire property or rights by prescription, either
personally or through their parents, guardians, or
legal representatives (CIVIL CODE, Art. 1107).
MODES THROUGH WHICH POSSESSION
CANNOT BE ACQUIRED: (FTC)
1. Through Force or intimidation, AND as
long as there is a possessor who objects
thereto (CIVIL CODE, Art. 536);
For all intents and purposes, a legal possessor,
even if physically ousted, is still deemed the legal
possessor because possession cannot be
acquired through force or violence (Cequeña v.
Bolante, G.R. No. 137944, April 6, 2000).
2. Through mere Tolerance (CIVIL CODE, Art.
537); and
Acts merely tolerated are those which by reason
of neighbourliness or familiarity, the owner of
property, allows his neighbour or another person
to do on the property (2 TOLENTINO, supra at
268).
It is difficult to draw a dividing line between
tolerance of the owner and abandonment of his
rights when the acts of the possessor are
repeated, especially when the lapse of time has
consolidated and affirmed a relation the legality
of the origin of which can be doubted. When there
is license or permission, the proof is easy. It is for
the court to decide in each case whether there
exists mere tolerance or an abandonment of
rights on the part of the owner (4 MANRESA 196-
197 as cited in 2 TOLENTINO, supra at 269).
Silence or inaction is negligence, not tolerance.
But where a person occupies another’s land with
the latter’s permission (tolerance), the occupier,
no matter how long he may remain, can never
acquire ownership, because he never had
possession (2 PARAS, supra at 497).
Possession by mere tolerance is not adverse.
Thus, it does not start the running of the period of
acquisitive prescription (Id.).
3. Through Clandestine efforts, secret
possession, and without the knowledge
of the possessor of a thing (CIVIL CODE,
Art. 537).
Requisites:
a. The acts are not public; and
b. It must be unknown to the possessor or
owner.
NOTE: A person who believes himself entitled to
the possession of property may not take the law
 into his hands (Spouses Antazo v. Doblada, G.R.
No. 178908, February 4, 2010) or else he will be
made to suffer the consequences of his
lawlessness (Santiago v. Cruz,G.R. No. L-31919,
March 24, 1930). For this reason, Article 536
mandates that he must invoke the aid of the
competent court, if the holder should refuse to
deliver the thing.
CONFLICT BETWEEN SEVERAL
CLAIMANTS:
GENERAL RULE: Possession as a fact cannot be
recognized at the same time in two different
personalities (CIVIL CODE, Art. 538).
EXCEPTIONS: In case of co–possession when there
is no conflict and possession in different concepts or
different degrees (DE LEON, Property, supra at 371).
Criteria in Case of Dispute:
1. Present/actual possessor shall be preferred;
2. If there are two possessors, the one longer in
possession;
3. If the dates of possession are the same, the one
with a title; and
4. If all the above are equal, the fact of possession
shall be judicially determined, and in the
meantime, the thing shall be placed in judicial
deposit (CIVIL CODE, Art. 538).
EFFECTS OF
POSSESSION
(ARTS. 539-554)
RIGHTS OF EVERY POSSESSOR
(WHETHER IN THE CONCEPT OF AN
OWNER OR A HOLDER):
1. To be respected in his possession; and
2. To be protected in or restored to said possession
by legal means should he be disturbed therein
(CIVIL CODE, Art. 539).
A possessor deprived of his possession through
forcible entry may within ten (10) days from the
filing of the complaint present a motion to secure
from the competent court, in the action for forcible
entry, a writ of preliminary mandatory injunction
to restore him in his possession (CIVIL CODE,
Art. 539).
REASON: There are many prolonged litigations
between the owner and the usurper and the
former is frequently deprived of his possession.
NOTE: A squatter has no possessory rights of
any kind against the owner of the land into which
he has intruded (Banez v. CA, G.R. No. L-30351,
September 11, 1974).
POSSESSION IN THE CONCEPT OF AN
OWNER OR EN CONCEPTO DE DUENO
Only possession acquired and enjoyed in the concept
of owner can serve as a title for acquiring dominion
(CIVIL CODE, Art. 540) even if he acted in bad faith.
A possessor in the concept of an owner has in his
favor the legal presumption that he possesses with a
just title and he cannot be obliged to show or prove it
(CIVIL CODE, Art. 541).
Presumption of just title does not apply in acquisitive
prescription. The adverse possessor must prove his
just title (DE LEON, Property, supra at 387).
KINDS OF TITLES:
1. True and Valid Title (Titulo Verdadero y
Valido)
– There was a mode of transferring ownership
and the grantor was the owner (Id. at 386-387);
2. Colorable Title (Titulo Colorado)
– There was such mode of transferring
ownership, BUT the grantor, whom the buyer
believes to be the owner, was, in fact, not the
owner (Id.); and
3. Putative Title (Titulo Putativo)
– That title although a person believes himself to
be the owner, he nonetheless is not because
there was no mode of acquiring ownership (Id.).
NOTE: Titulo colorado is what is meant by “just title”
in the law of prescription, and not titulo verdadero y
valido, for if it were the latter, there could be no
necessity of still acquiring ownership through
prescription, the grantee being already the owner
(Solis v. CA, G.R. No. L-46753, August 25, 1989).
POSSESSION IN THE CONCEPT OF
HOLDER:
1. Lessees;
2. Trustees, including: parents over the properties
of their children; and husband and wife over each
other’s property;
3. Antichretic creditors;
4. Agents;
5. Attorney’s regarding their client’s properties;
6. Depositaries; and
7. Co-owners (2 PARAS, supra at 523).
NOTE: Possession of real property presumes that of
the movables therein, so long as it is not shown or
proved that they should be excluded (CIVIL CODE,
POSSESSOR IN POSSESSOR IN BAD
Art. 542).
GOOD FAITH FAITH
Presumption applies whether the possessor be in As to Fruits Pending and Charges
good faith or bad faith, in one’s own name, or in
another’s and in concepto de dueno or in the concept Prorated according to To owner.
of holder (2 PARAS, supra at 530). time of possession of
owner and possessor.
RULES ON CO-POSSESSION:
As to Production Expenses of Pending Fruits
1. Each one of the participants of a thing possessed
in common shall be deemed to have exclusively Indemnity pro-rata to No indemnity.
possessed the part which may be allotted to him possessor (owner’s
upon division thereof, for the entire period during option) in money, or by
which the co-possession lasted; allowing full cultivation
2. Interruption in the possession of the whole or a and gathering of all
part of a thing possessed in common shall be to fruits.
the prejudice of all possessors; and
3. In case of civil interruption, the Rules of Court As to the Necessary Expenses
shall apply (CIVIL CODE, Art. 543.).
Reimbursed to Reimbursed to
Possession is interrupted for purposes of prescription possessor; retention. possessor; No
either naturally or civilly (CIVIL CODE, Art. 1120). retention.
Possession is naturally interrupted when through any
cause it should cease for more than one year (CIVIL As to the Useful Expenses
CODE, Art. 1121).
1. Reimbursement and No reimbursement.
retention; or Right of removal
CIVIL INTERRUPTION 2. May remove useful provided that the thing
When interruption is produced by judicial summons improvements if no suffers no injury and
to the possessor, only those possessors served with reimbursement, and lawful possessor does
judicial summons are affected (DE LEON, Property, no damage is not prefer to retain
supra at 390). caused to the them by paying the
principal by the value they may have at
NOTE: Judicial summons shall be deemed not to removal with right of the time he enters into
have been issued and shall not give rise to retention (CIVIL possession. (CIVIL
interruption: CODE, Art. 546). CODE, Art. 549).
1. If it should be void for lack of legal solemnities;
2. If the plaintiff should desist from the complaint or As to the Ornamental Expenses
should allow the proceedings to lapse; and
3. If the possessor should be absolved from the 1. No reimbursement; 1. No reimbursement;
complaint. and and
2. Removal without 2. Removal without
In all these cases, the period of interruption shall be injury or injury or
counted for the prescription (CIVIL CODE, Art. 1124; reimbursement of reimbursement of
2 PARAS, supra at 525). amount expended at value at time of
option of lawful recovery at option of
RIGHTS OF A POSSESSOR IN GOOD FAITH possessor. lawful possessor.
V. POSSESSOR IN BAD FAITH As to the Taxes and Charges
POSSESSOR IN POSSESSOR IN BAD (1. On Capital, 2. On Fruits and 3. On
GOOD FAITH FAITH Charges)

As to Fruits Gathered Taxes and charges Taxes and charges

1. Charged to owner; 1. Charged to owner;
To possessor. To owner. 2. Charged to 2. Charged to owner;
possessor; 3. To owner.
As to Cultivation Expenses of Gathered 3. Prorated.
Fruits
As to Improvements No Longer Existing
Not reimbursed to Reimbursed to
possessor. possessor. No reimbursement. No reimbursement.
 summary action, but he may still bring an
POSSESSOR IN POSSESSOR IN BAD
action publiciana or reivindicatoria.
GOOD FAITH FAITH

As to Liability for Accidental Loss or e. By reason of the object

Deterioration i. Destruction or total loss of the things;
and
Only if acting with Liable in every case. ii. Withdrawal from commerce
fraudulent intent or
negligence, after ACTS NOT CONSTITUTING LOSS OF
summons (CIVIL POSSESSION (CIVIL CODE, Arts. 537–
CODE, Art. 552).
538)
NOTE: Before receipt of 1. Acts executed by stealth and without knowledge
judicial summons, of the possessor;
possessor not liable. 2. Acts merely tolerated either by the possessor or
(PARAS,supra at 537). by his representative or holder in his name unless
authorized or ratified;
As to Improvements Due to Time or Nature 3. Violence; and
4. Temporary ignorance of the whereabouts of
To owner or lawful To owner or lawful movable property.
possessor. possessor.
(DE LEON, Property, supra at 406 to 408). The possessor who recovers possession is
considered as having had uninterrupted
Necessary Expenses possession despite these acts of violence,
Those made for the preservation of the thing stealth, and tolerance; but he must recover
(2 PARAS, supra at 539). possession by due process and not otherwise
(CIVIL CODE, Arts. 561, 536, 539).
Useful Expenses
Those that add value to property or increase the Possessory acts of mere holder do not bind or
object’s productivity (Id. at 541). prejudice the possessor in the concept of owner,
unless said acts were previously authorized or
Ornamental/Luxury Expenses ratified by the latter (CIVIL CODE, Art. 558).
Those that add value to the thing only for certain
persons in view of their particular whims; neither POSSESSION OF MOVABLES (CIVIL
essential for preservation nor useful to everybody in CODE, ART. 559)
general (Id. at 549).
THEORY OF IRREVINDICABILITY
GENERAL RULE: Possession of movable property
LOSS OF POSSESSION acquired in good faith is equivalent to a title (CIVIL
CODE, Art. 559).
(ARTS. 555)
NOTE: Possession in good faith does not really
amount to title, for the reason that Art. 1132 of the
Code provides for a period of acquisitive prescription
GENERAL CAUSES: for movables through 'uninterrupted possession for
1. By the will of the possessor four years in good faith' (xxx), so that many Spanish
a. Abandonment; and writers, including Manresa, Sanchez Roman,
b. Assignment Scaevola, De Buen, and Ramos, assert that under
2. Against the will of the possessor Art. 464 of the Spanish Code (Art. 559 of the New
a. Eminent domain; Civil Code), the title of the possessor in good faith is
b. Acquisitive prescription; not that of ownership, but is merely a presumptive title
c. Judicial decree in favor of one who has a sufficient to serve as a basis for acquisitive
better right; prescription (De Garcia v. Court of Appeals, G.R. No.
d. Possession of another for more than one L-20264, January 30, 1971).
year;
Illustration: If X buys in good faith books from Y, an
NOTE: This refers to possession de facto impostor, who succeeded in purchasing the books
where the possessor loses the right to a from Z by falsely identifying himself and paying the
price by means of a check which was dishonored, the
law establishes an actual right thereto in favor of X.
The subsequent dishonor of the check merely
amounted to a failure of consideration which does not
render the contract of sale void, but merely allows the
prejudiced party to sue for specific performance or
rescission of the contract and to prosecute the
impostor for estafa under Art 315 of the Revised
Penal Code. (EDCA Publishing v. Santos, G.R. No.
80298, April 26, 1990).
Requisites: (GOV)
1. Possession is in Good faith;
2. Possessor is in the concept of Owner; and
3. The owner has Voluntarily parted with the
possession of the thing (DE LEON, Property,
supra at 411-412).
EXCEPTION: One who has lost or has been
unlawfully deprived of a movable may recover it from
whoever possesses it without reimbursement. The
owner of the thing must prove: (a) ownership of the
thing; and (b) loss or unlawful deprivation; or bad faith
of the possessor (Id. at 420-421).
If the owner has lost a thing, or if he has been
unlawfully deprived of it, he has a right to recover it,
not only from the finder, thief or robber, but also from
third persons who may have acquired it in good faith
from such finder, thief or robber (Aznar v.Yapdiangco,
G.R. No. L-18536, March 31, 1965).
NOTE: “Unlawful deprivation” includes all cases of
taking that constitute a criminal offense (DE LEON,
Property, supra at 416).
EXCEPTIONS TO THE EXCEPTION: (NG)
1. Where the owner acts Negligently or voluntarily
parts with the thing owned, he cannot recover it
from the possessor; and
2. If the possessor of the movable acquired it in
Good faith at a public sale, the owner cannot
obtain its return without reimbursing the price
paid therefore keeper (CIVIL CODE, Art. 559,
Par. 2).
NOTE: In the following public sale transactions,
the owner cannot recover:
a. Where the owner of the movable is, by his
conduct, precluded from denying the seller’s
authority to sell; and
b. Where the law enables the apparent owner
to dispose of the movable as if he were the
true owner thereof, i.e., Civil Code (Art. 1507-
1520), the Property Registration Decree
(P.D. No. 1525), the Negotiable Instruments
Law (Art. 2031), and the Warehouse
Receipts Law (Act No. 2137);
c. Where the sale is sanctioned by statutory or
judicial authority;
d. Where the sale is made at merchant’s stores,
fairs or markets (CIVIL CODE, Art. 1505);
e. Where the seller has a voidable title, which
has not been avoided at the time of the sale
to the buyer in good faith for value and
without notice of the seller’s defect if title
(CIVIL CODE, Art. 1506);
f. Where recovery is no longer possible
because of prescription (CIVIL CODE, Art.
1132); and
g. Where the possessor becomes the owner of
the thing in accordance with the principle of
finder’s keeper (CIVIL CODE, Art. 719) (DE
LEON, Property, supra at 415).
SUMMARY OF RECOVERY OR NON-
RECOVERY PRINCIPLE
1. Owner may recover without reimbursement:
a. From possessor in bad faith; and
b. From possessor in good faith (if owner had
lost the property or been unlawfully deprived
of it and the acquisition being from a private
person);
2. Owner may recover but should reimburse: if
possessor acquired the object in good faith at
public sale or auction
3. Owner cannot recover, even if he offers to
reimburse:
a. If possessor had acquired it in good faith by
purchase from a merchant’s store, or in fairs
or markets in accordance with the Code of
Commerce and special laws;
b. If owner is by his conduct precluded from
denying the seller’s authority to sell; and
c. If the possessor had obtained the goods
because he was an innocent purchaser for
value and a holder of a negotiable document
of title to the goods (2 PARAS, supra at 566).
POSSESSION OF ANIMALS
Wild animals are possessed only while they are under
one’s control; domesticated or tamed animals are
considered domestic or tame, if they retain the habit
of returning to the premises of the possessor (CIVIL
CODE, Art. 560).
Animals may be:
1. Wild animals
– Those living in a state of nature independently
of and without the aid and care of man (DE
LEON, Property, supra at 423).
2. Domesticated or tamed animals
a. Wild or savage by nature but have been
subdued and became accustomed to live in
a tamed condition;
b. Domestic animals - born and reared under
the control and care of man, lacking the
instinct to roam freely (Id.).
NOTE: The possessor or owner of domesticated CHARACTERISTICS: (TRECT)
animals has a period of 20 days counted from the 1. Of Temporary duration;
occupation by another person within which to reclaim
them. 2. Real right of the use and enjoyment of the
property whether or not the same be registered
in the Registry of Property;

USUFRUCT NOTE: It must be registered in the Registry of

(ARTS. 562-612) Property to prejudice third persons (CIVIL CODE,
Art. 709).

3. Purpose is to Enjoy the benefits and derive all

advantages from the thing due to normal
USUFRUCT exploitation;
Usufruct gives a right to enjoy the property of another
with the obligation of preserving its form and 4. May be Constituted on real or personal property,
substance, unless the title constituting it or the law consumable or non–consumable, tangible or
otherwise provides (CIVIL CODE, Art. 562). intangible, the ownership of which is vested in
another; and
THREE (3) FUNDAMENTAL RIGHTS
PERTAINING TO OWNERSHIP (DUF) NOTE: A person cannot create a usufruct over his
1. Jus Disponendi own property and at the same time retain ownership
– Right to dispose, alienate, encumber, of the same for usufruct is essentially jus in re
transform, and destroy; aliena; and to be a usufructuary of one’s own
property is, in law, a contradiction in terms and a
conceptual absurdity (Gaboya v. Cui, G.R. No. L-
2. Jus Utendi
19614 March 27, 1971).
– Right to use; and
5. Transmissible (DE LEON, Property, supra at
3. Jus Fruendi 426).
– Right to the fruits.

DIFFERENCE IN RIGHTS BETWEEN REQUISITES OF USUFRUCT:

USUFRUCT AND NAKED OWNERSHIP 1. Essential
– The real, temporary right to enjoy another’s
NAKED property.
USUFRUCT
OWNERSHIP
Jus Utendi and Jus Jus Disponendi 2. Natural
Fruendi – The obligation to preserve its form or
substance.
(2 PARAS, supra at 578).
NOTE: Ordinarily this is present, but a contrary
FORMULA: stipulation can eliminate it because it is not
essential (2 PARAS, supra at 578). The
1. Full Ownership = Naked Ownership + Usufruct;
obligation being merely a natural requisite, the
2. Naked Ownership = Full Ownership - Usufruct;
title or law may provide otherwise (CIVIL CODE,
3. Usufruct = Full Ownership - Naked Ownership
Art. 562), giving rise to abnormal, irregular or
(Id.).
imperfect usufruct (2 PARAS, supra at 579).
Usufruct, in essence, is nothing else but the right to
enjoy another's property. While this right to enjoy the 3. Accidental
property of another temporarily includes both the jus – Those which may be present or absent
utendi and the jus fruendi, the owner retains the jus depending upon the stipulation of the parties. (Id.
disponendi or the power to alienate the same (Heirs at 579).
of Jarque v. Jarque, G.R. No. 196733, November 21,
2018). CLASSIFICATIONS OF USUFRUCT
1. As to Origin (CIVIL CODE, Art. 563):
a. Legal – Constituted by law.

Example: Usufruct of the parents over the

property of their unemancipated children
 limited primarily to the child's support and
secondarily to the collective daily needs of
the family. (FAMILY CODE, Art. 226);
b. Voluntary – Constituted by the will of private
persons expressed in acts inter vivos or in a
last will and testament; and
c. Mixed – Constituted by prescription (i.e.,
created both by law and by the act of a
person);
Illustration: Usufruct acquired by
prescription such as when believing himself
to be the owner of the property of an
absentee, gave in his will the usufruct of the
property for the requisite prescriptive period
to his wife, who possessed it in good faith as
usufructuary, and naked ownership to his
brother (DE LEON, Property, supra at 425).
2. As to Extent of Coverage:
a. Total – constituted on the whole of the fruits
of the thing; and
b. Partial – a part of the fruits of the thing (CIVIL
CODE, Art. 564).
3. As to Kind of Object:
a. Over a right, if it involves intangible property
provided it is not strictly personal or
intransmissible; and
b. Over things, if it involves tangible property
(CIVIL CODE, Art. 564).
4. As to Number of Persons Enjoying the
Right
a. Singular – in favor of one person; and
b. Multiple – two or more persons
i. Simultaneously, i.e., at the same time or
ii. Successively, i.e., one after the other.
(CIVIL CODE, Art. 564).
NOTE: A usufruct constituted in favor of
several persons living at the time of its
constitution shall not be extinguished until the
death of the last survivor (CIVIL CODE, Art.
611).
5. As to Term or Conditions
a. Pure;
b. With a Term or Period;
a. Ex die – from a certain day;
b. In diem – up to a certain day; and
c. Ex die in diem – from a certain day up to
a certain day.
c. Conditional (CIVIL CODE, Art. 564).
6. As to the Extent of Owner’s Patrimony
(CIVIL CODE, Arts. 598-599):
a. Universal – if over the entire patrimony; and
b. Singular or Particular – if only individual
things are included.
7. As to Whether or Not Impairment of
Object is Allowed (CIVIL CODE, Art. 562).
a. Normal (or Perfect or Regular) – that which
involves non-consumable things which the
usufructuary can enjoy without altering their
form or substance; and
b. Abnormal (or Imperfect or Irregular) – that
which involves things which would be
useless to the usufructuary unless they are
consumed or expended.
RULES GOVERNING USUFRUCT:
1. The rights and obligations of the usufructuary
shall be those provided in the title constituting the
usufruct; or
2. In default of such title, or in case it is deficient, the
provisions contained in the Civil Code regarding
usufruct shall apply (CIVIL CODE, Art. 565).
OBLIGATION TO PRESERVE THE
OBJECT OF THE USUFRUCT
GENERAL RULE: Usufructuary is bound to preserve
the form and substance of the thing in usufruct (CIVIL
CODE, Art. 562).
EXCEPTIONS:
1. When the law or the title creating the usufruct
provides that the usufructuary is not so obliged
(CIVIL CODE, Art. 565);
2. When the usufruct includes things which, without
being consumed, gradually deteriorate through
wear and tear (CIVIL CODE, Art. 573); and
3. When the usufruct includes things which cannot
be used without being consumed (quasi-usufruct)
(CIVIL CODE, Art. 574).
USUFRUCT V. LEASE
USUFRUCT LEASE
As to Nature of Right
Always a real right. Generally, a personal
right; However, a
registered lease on
land is a real right.
As to Creator of Right
Person creating the Lessor may not be the
usufruct should be the owner, i.e., sub-lessor,
owner or his duly usufructuary.
authorized agent.
As to Origin
May be created by law, Generally created by
by contract, by will of the contract.
 do so, he should pay its value at the time the
USUFRUCT LEASE
usufruct ceases (Id.).
testator, or by b. If deterioration is due to an event or act that
prescription. EXCEPTION: by law, endangers their preservation (fortuitous
i.e., implied new lease. event) (CIVIL CODE, Art. 1174), the
usufructuary is not responsible. He is,
As to Scope however, obliged to make the necessary or
ordinary repairs (CIVIL CODE, Art. 592).
Usufruct generally Lease generally refers
covers all the fruits and to uses only, i.e., those NOTE: Ordinary repairs are understood such
all the uses and benefits stipulated. as are required by the wear and tear due to
of the entire property. the natural use of the thing and are
indispensable for its preservation (CIVIL
As to Cause CODE, Art. 592).
Involves a more or less Lease involves a more
c. If deterioration is due to fraud (dolo incidente
passive owner who active owner or lessor
or fraud amounting to an evasion of the
allows the usufructuary who makes the lessee
obligation to preserve) or negligence (CIVIL
to enjoy the object given to enjoy the thing
CODE Art. 1174), the usufructuary shall be
in usufruct. leased.
obliged to indemnify the owner for any
As to Repairs and Taxes deterioration they may have suffered by
reason of his fraud or negligence (CIVIL
Usufructuary pays for Lessee is not generally CODE, Art. 573).
ordinary repairs and under obligation to
taxes on the fruits (CIVIL undertake repairs or NOTE: Such liability however may be set-off
CODE, Art. 592). pay taxes. against the improvements he may have
made (CIVIL CODE, Art. 580).
(DE LEON, Property, supra at 428-429).
3. Of consumable property
SPECIAL USUFRUCTS Whenever the usufruct includes things which
1. On Rent, Pension or Benefits cannot be used without being consumed, the
Whenever a usufruct is constituted on the right to usufructuary shall have the right to make use of
receive a rent or periodical pension, whether in them under the obligation of paying their
money or in fruits, or in the interest on bonds or appraised value at the termination of the usufruct,
securities payable to bearer, each payment due if they were appraised when delivered (CIVIL
shall be considered as the proceeds or fruits of CODE, Art. 574).
such right (civil fruits) (CIVIL CODE, Art. 570) and
shall be deemed to accrue proportionately to the In case they were not appraised, he shall have
usufructuary, from the time the usufruct lasts the right to return the same quantity and quality
(CIVIL CODE, Art. 569). or pay their current price at the time the usufruct
ceases (CIVIL CODE, Art. 574).
Those that accrue after the termination of the
usufruct belong to the owner (DE LEON, NOTE: This is another instance of abnormal
Property, supra at 437). usufruct and is sometimes referred to as a
quasi-usufruct because the form is not really
2. Over things which gradually deteriorate preserved. Thus, this is really a simple loan (2
Art. 573 deals with abnormal or imperfect PARAS, supra at 599).
usufruct. It deals with things that deteriorate
much faster than others such as clothes, 4. On fruit bearing trees and shrubs
vehicles, and computers (2 PARAS, supra at The usufructuary may make use of the dead
597). trunks, and even of those cut off or uprooted by
accident, under the obligation to replace them
Effect of the Deterioration on the with new plants (CIVIL CODE, Art. 575).
Usufructuary’s Liability:
a. If deterioration is due to normal use (wear NOTE: No such obligation exists with respect to
and tear), the usufructuary is not responsible. those dead trees or shrubs already existing at the
Nor is he required to make any repairs to beginning of the usufruct (CIVIL CODE, Art. 575
restore it to its former condition. He may in relation to Art. 562).
return them in the condition they might be in
at the termination of the usufruct. If he fails to
 Effect of a Calamity on the Trees and Shrubs
a. If it is impossible or too burdensome to
replace them, the usufructuary may either:
i. Use the trunks but should replace them
(CIVIL CODE, Art. 575); or
ii. Leave the dead, fallen, uprooted trunks
at the owner’s disposal, and demand that
the latter remove them and clear the land
(CIVIL CODE, Art. 576).
b. If it is not “too burdensome” to replace them,
he must replace them (whether he uses the
trunks or not), and he cannot demand
clearance of the land by the owner (DE
LEON, Property, supra at 428).
5. On woodlands and nurseries
The usufructuary of woodland may enjoy all the
benefits which it may produce according to its
nature (CIVIL CODE, Art. 577).
In case of usufruct over a woodland which is a
copse or consists of timber for building, in
cutting or feeling the trees, he must:
a. Follow the owner’s habit or practices;
b. In default thereof, the customs of the place
as to manner, amount, and season; and
c. If there be no customs, the only time the
usufructuary can cut down trees will be for
repair or improvement, but the owner must
first be informed (2 PARAS, supra at 602).
6. On a right to recover by court action
The usufructuary of an action to recover real
property or a real right or any movable property
has the right to bring the action and to oblige the
owner thereof to give him:
a. Authority to bring the action (through SPA);
and
b. Furnish him whatever proof the owner may
have (CIVIL CODE, Art. 578).
The Action May Be Instituted in the
Usufructuary’s Name, Subject to the
Following:
a. If the purpose is the recovery of the
property or right, he is still required to
obtain the naked owner’s authority; or
b. If the purpose is to object to or prevent
disturbance over the property, no special
authority from the naked owner is needed (2
PARAS, supra at 605).
Effect of Judgment
If in consequence of the enforcement of the
action the usufructuary acquires the thing
claimed:
a. The usufruct shall be limited to the fruits; and
b. The dominion remains with the owner (CIVIL
CODE, Art. 578).
NOTE: After a successful judgment, the usufruct
is now over the thing awarded and not on the right
to recover (2 PARAS, supra at 605).
7. On property owned in common
A co-owner may give the usufruct of his share to
another, even without the consent of others,
unless personal considerations are present
(CIVIL CODE, Art. 582 in relation to Art. 493).
The usufructuary in such a case takes the
owner’s place as to:
a. Administration (management); and
b. Collection of fruits or interest (CIVIL CODE,
Art. 582).
Effect of Partition:
a. If there be a partition, the usufructuary
continues to have the usufruct of the part
allotted to the co-owner concerned (CIVIL
CODE, Art. 582).
b. If the partition was done without the
intervention of the usufructuary, the partition
binds the usufructuary. However, the naked
owner must respect the usufruct (Pichay v.
Querol, G.R. No. 4452, October 1, 1908).
8. Of fruitful or productive livestock
(livestock)
If the usufruct be constituted on a flock or herd of
livestock, the usufructuary shall be obliged to
replace with the young thereof the animals that
die each year from natural causes, or are lost due
to the rapacity of beasts of prey (CIVIL CODE,
Art. 591).
NOTE: This article applies only when the usufruct
is on a FLOCK and HERD of livestock (not
merely two or three animals) (2 PARAS, supra at
620).
There is Obligation to Replace:
a. If some animals die from natural causes; or
b. If some animals are lost due to rapacity of
beasts of prey (Id.).
NOTE: There is the duty to replace even though
the cause is fortuitous. Replacement should be
made from the young produced (Id.).
Illustration: If 15 cattles died, but only
3 were produced, only 3 must be replaced; hence
also, if 15 died, but 20 were produced, the excess
of 5 belong to the usufructuary since they are
fruits (Id.).
There is NO Obligation to Replace:
a. If there is total loss of the animals because of
some unexpected or unnatural loss; or
b. If there is a partial loss (Id. at 621).
 In both of the foregoing instances, the
usufructuary must have no fault resulting in the
loss (Id.).
NOTE: The remains, not the remainder should go
to the naked owner. The usufruct continues on
the remainder, provided that the loss be by
accident and without fault of the usufructuary
(Id.).
In case of sterile animals, since there are no
young, the rule of usufruct over fungibles applies
(CIVIL CODE, Art. 574).
9. Over the entire patrimony
In case of a universal usufruct, as when the
usufruct involves the entire patrimony and if at
the time of its constitution, the owner has debts,
or is obliged to make periodical payments, even
if there should be no known capital, the
provisions of Arts. 758 and 759 shall be applied
both with respect to the maintenance of the
usufruct and to the obligation of the usufructuary
to pay such debts (CIVIL CODE, Art. 598). Thus:
a. If there is a stipulation for the payment by the
usufructuary of the debts of the owner, the
former is liable only for debts contracted by
the latter before the constitution of the
usufruct (CIVIL CODE, Art. 758).
b. If there is no stipulation regarding the
payment of debts, the usufructuary shall be
responsible only when the usufruct has been
made in fraud of creditors (CIVIL CODE, Art.
759).
10. On mortgaged property
The usufructuary of a mortgaged immovable
shall not be obliged to pay the debt for the
security of which the mortgage was constituted.
Should the immovable be attached or sold
judicially for the payment of the debt, the owner
shall be liable to the usufructuary for whatever
the latter may lose by reason thereof (CIVIL
CODE, Art. 600).
Here, the usufruct is particular, constituted by
will or by acts inter vivos, whether by onerous or
gratuitous title. If the usufruct is universal,
covering all the property of the owner, all or some
of which are mortgaged, the liability of the
usufructuary to pay for the mortgage is governed
by Art. 598 (DE LEON, Property, supra at 491).
NOTE: Since usufruct is a real right, the usufruct
(as distinguished from the property itself) may be
mortgaged, not by the naked owner, but by the
usufructuary. In such a case, it is the usufructuary
who should pay his own debt (2 PARAS, supra at
631).
Liability of the Naked Owner May Be
Extinguished:
a. By constituting a usufruct over an equivalent
estate;
b. By payment of a periodical pension
equivalent to the loss; or
c. Any other similar way (Id.).
NOTE: It is believed that Art. 600 can also apply,
by analogy, to a pledged movable, provided that
the movable is in the usufructuary possession
(Id. at 632).
RIGHTS OF THE
USUFRUCTUARY
(ARTS. 566-582)
SUMMARY OF RIGHTS OF A
USUFRUCTUARY
1. As to the thing and its fruits
a. To receive and benefit from all the fruits –
natural, industrial and civil fruits (CIVIL
CODE, Art. 566);
b. To the half of the hidden treasure he
accidentally finds (CIVIL CODE, Art. 566 in
relation to Art. 438);
c. To enjoy any increase through accessions,
servitudes, easements, and all benefits
inherent in the property (CIVIL CODE, Art.
571);
d. To lease the thing, generally, for the same or
shorter period as the usufruct (CIVIL CODE,
Art. 572);
e. To make on the property in usufruct such
improvement or expenses he may deem
proper and to remove the improvements
provided no damage is caused to the
property (CIVIL CODE, Art. 579);
f. Right to set–off the improvements he may
have made on the property against any
damage to the same (CIVIL CODE, Art. 580);
and
g. To retain the thing until he is reimbursed for
advances for extraordinary expenses and
taxes on the capital (CIVIL CODE, Art. 612).
2. As to the usufruct itself
a. To alienate the usufructuary right (except
parental usufruct) (CIVIL CODE, Art. 572 in
relation to FAMILY CODE, Arts. 225 and
226);
b. To bring action and oblige owner thereof to
give him proper authority and necessary
 proof in a usufruct to recover property or a
real right (CIVIL CODE, Art 578);
c. To exercise all the rights pertaining to the co-
owner with respect to the administration and
collection of fruits or interests from the
property in a usufruct of part of a common
property (CIVIL CODE, Art. 582);
d. Right to make use of the land and materials,
when building forming part of the usufruct on
immovable has been destroyed in any
manner (CIVIL CODE, Art. 607);
e. If usufructuary shares in insurance of
tenement in usufruct, and it was lost, he shall
continue in enjoyment of the new one if one
be constructed or receive interest on the
insurance indemnity (CIVIL CODE, Art. 608);
and
f. To remove improvements made by him if the
same will not injure the property (CIVIL
CODE, Art. 579).
3. As to advances and damages
a. To be reimbursed for indispensable
extraordinary repairs made by him in an
amount equal to the increase in value which
the property may have acquired by reason of
such repairs (CIVIL CODE, Art. 594);
b. To be reimbursed for taxes on capital
advanced by him (CIVIL CODE, Art. 597);
and
c. To be indemnified for damages caused to
him by the naked owner (CIVIL CODE, Art.
581).
RIGHTS OF THE USUFRUCTUARY:
1. As to the thing and its fruits
a. To receive and benefit from all the fruits –
natural, industrial and civil fruits (CIVIL
CODE, Art. 566);
The usufructuary has the right to receive all
the fruits except:
i. Where the usufruct is constituted
only on a part of the fruits of a thing
(CIVIL CODE, Art. 564); or
ii. Where there is an agreement to the
contrary (CIVIL CODE, Art. 565).
RIGHTS TO THE FRUITS
OBJECT OWNER USUFRUCTUARY
Dividends
Products which
diminish
capital
OBJECT OWNER USUFRUCTUARY
Fruits growing
at the
beginning of
the usufruct
Fruits growing
at the
termination of
then usufruct
A dividend, whether in the form of stock, is
income and, consequently, should go to the
usufructuary, taking into consideration that a
stock dividend as well as a cash dividend can
be declared only out of profits of the
corporation (DE LEON, Property, supra at
430).
Since it is the obligation of the usufructuary
to preserve the form and substance of the
property unless the contrary is provided,
products (e.g., minerals extracted from
mines) which when taken from the
property diminishes its substance are not
to be treated as fruits. They form part of the
capital and belong to the naked owner (Id.).
Rules on Pending Natural or Industrial
Fruits (Art. 567)
i. Fruits pending at the beginning of
usufruct:
1.) Belong to the usufructuary;
2.) No necessity to refund the owner for
expenses incurred;
3.) But without prejudice to the right of
third persons.
ii. Fruits pending at the termination of
usufruct:
1.) Belong to the owner;
2.) But the owner must reimburse the
usufructuary for ordinary cultivation
expenses and for the seeds and
similar expenses, from the proceeds
of the fruits;
3.) Rights of innocent third parties
should not be prejudiced in relation
to Art. 546 and 443 of the Civil Code
(2 PARAS, supra at 589-590).
NOTE: If the expenses are greater than the
proceeds of the fruits, the owner has no
obligation to reimburse the difference (Id.).
REASON: There is no proceeds of fruits from
which the expenses should be paid (DE
LEON, Property, supra at 435).
b. To the half of the hidden treasure, he
accidentally finds (CIVIL CODE, Art. 566 in
relation to Art. 438);
NOTE: The usufructuary is not entitled to any
hidden treasure which may be found on the
property because it does not fall under the
term “fruits’’. He shall be considered a
stranger, i.e., if he is the finder, he is entitled
to 1/2 of the treasure with the other half
pertaining to the owner; if another person is
the finder, such person gets 1/2 as finder,
and the owner gets the other half as owner
(DE LEON, Property, supra at 430). If
somebody else is the finder, the usufructuary
gets nothing (4 MANRESA, supra at 386-
387).
c. To enjoy any increase through accessions,
servitudes, easements, and all benefits
inherent in the property (CIVIL CODE, Art.
571);
REASON: Usufruct covers the entire jus
fruendi and the entire jus utendi (2 PARAS,
supra at 594).
d. To lease the thing, generally, for the same or
shorter period as the usufruct (CIVIL CODE,
Art. 572);
The usufructuary may lease it even without
the owner’s consent but, not being the owner,
the usufructuary, cannot alienate, pledge or
mortgage the thing itself (CIVIL CODE, Art.
572).
He may sell future crops subject to the rule
that those ungathered at the time when the
usufruct terminates belong to the owner.
When the things given in usufruct cannot be
used without being consumed or were
appraised when delivered, the usufructuary
may dispose of them (DE LEON, Property,
supra at 466).
2. As to the usufruct itself
If the lessee should damage the property,
the usufructuary shall answer to the owner.
(CIVIL CODE, Art. 590) subject to the latter’s
right to demand reimbursement from the
former. If the usufructuary cannot pay the
damage to the naked owner, his bond shall
be liable (CIVIL CODE, Art. 583(2)).
NOTE: All contracts entered into by the
usufructuary shall terminate upon the
expiration of the usufruct or earlier, except
rural leases which continue during the
agricultural year (CIVIL CODE, Art. 572 in
relation to Art.1682).
e. To make such improvement or expenses he
may deem proper on the property which is
the subject of the usufruct (CIVIL CODE, Art.
579);
NOTE: The usufructuary has the right to
make useful improvements or expenses for
mere pleasure provided that he must not
alter the form or substance of the property in
usufruct but he shall have no right to be
indemnified therefor but he may either:
i. Remove the improvements if no
substantial damage to the property is
caused; or
ii. Set-off the improvements against
damages for which he may be liable
under Art. 580 (CIVIL CODE, Art. 579 in
relation to Art. 580).
f. Right to set–off the improvements he may
have made on the property against any
damage to the same (CIVIL CODE, Art. 580);
and
Requisites Before Set-off Can Be Made:
i. Damage must have been caused by the
usufructuary; and
ii. Improvements must have augmented the
value of the property (2 PARAS, supra at
608).
Rules Governing Art. 580:
i. If damage exceeds the value of the
improvements, usufructuary is still liable
for the difference;
ii. If the value of the improvements exceed
the damage, the difference does not go
to the usufructuary, but accrues in favor
of the naked owner, in the absence of
stipulation to the contrary (Id. at 601).
g. To retain the thing until he is reimbursed for
advances for extraordinary expenses and
taxes on the capital (CIVIL CODE, Art. 612).
a. To alienate the usufructuary right (except
parental usufruct) (CIVIL CODE, Art. 572 in
relation to FAMILY CODE, Arts. 225 and
226);
GENERAL RULE: The usufructuary may
pledge or mortgage the usufructuary right
(because he owns said right) but he cannot
pledge or mortgage the thing itself because
he does not own the thing (CIVIL CODE, Art.
572 in relation to Art. Art. 2085 (2)).
 EXCEPTIONS:
i. The legal usufruct of the parent over his
or her children cannot be alienated,
pledged, or mortgaged for the right is
personal and intransmissible burdened
as it is by important obligations of the
parent for the benefit of said children
(CIVIL CODE, Art. 572 in relation to
FAMILY CODE, Arts. 225 and 226); and
ii. A usufruct given in consideration of the
person of the usufructuary to last during
his lifetime is also personal and,
therefore, intransmissible (2 PARAS,
supra at 424).
NOTE: All contracts entered into by the
usufructuary shall terminate upon the
expiration of the usufruct or earlier, except
rural leases which continue during the
agricultural year (CIVIL CODE, Art. 572 in
relation to Art.1682).
b. To bring action and oblige owner thereof to
give him proper authority and necessary
proof in a usufruct to recover property or a
real right (CIVIL CODE, Art. 578);
(See prior discussion on Special Usufructs,
particularly on Art. 578).
c. To exercise all the rights pertaining to the co-
owner with respect to the administration and
collection of fruits or interests from the
property in a usufruct of part of a common
property (CIVIL CODE, Art. 582);
(See discussion on Special Usufructs,
particularly on Art. 582).
d. Right to make use of the land and materials:
i. if the usufruct is constituted on
immovable property of which a building
forms part, and the latter should be
destroyed in any manner whatsoever
(usufruct on both the building and the
land); or
ii. if the usufruct is constituted on a building
only and the same should be destroyed
(usufruct on the building only) (CIVIL
CODE, Art. 607).
e. If usufructuary shares in insurance of
NOTE: In this case, if the owner should
wish to construct another building, he
shall have a right to occupy the land and
to make use of the materials, being
obliged to pay to the usufructuary, during
the continuance of the usufruct, the
interest upon the sum equivalent to the
value of the land and of the materials
(CIVIL CODE, Art. 607). Precisely
because there was no usufruct on the
land, the naked owner has preferential
right to its use (2 PARAS, supra at 634).
Usufruct on a Building and/or the
Land Concerned (CIVIL CODE, Art.
607)
Rules:
1.) Usufruct on both building and land
(but the building is destroyed in any
manner whatsoever before the
expiration of the period of the
usufruct):
a.) The usufruct on the building
ends, but the usufruct on the
land continues;
b.) Therefore, the usufructuary is
still entitled to the use of the land
and the use of whatever
materials of the house remain;
c.) If the naked owner wants to
rebuild but the usufructuary
refuses, it is the usufructuary
who prevails for the use of the
land is still his for the remainder
of the period (2 PARAS, supra at
640-641).
2.) Usufruct on the building alone (but
the building is destroyed before the
termination of the period):
a.) The usufruct on the building
ends, but the usufructuary can
still make use of whatever
materials of the house remain;
b.) The usufructuary is entitled to
the use of the land;
c.) Because there was no usufruct
on the land, the naked owner
has preferential right to its use
(Id. at 634-635).
NOTE: While the usufruct on a
building does not expressly include
the land on which it is constructed,
the land should be deemed included,
because there can be no building
without land (DE LEON, Property,
supra at 472).
tenement in usufruct, and it was lost, he shall
continue in enjoyment of the new one if one
be constructed or receive interest on the
insurance indemnity (CIVIL CODE, Art. 608);
What constitutes as “sharing”
i. According to Manresa, the amount
respectively given is immaterial, and that
as long as both shared in paying the first
 paragraph of Art. 608 applies, except if
there be a stipulation between them to
the contrary.
ii. A better solution perhaps would be to
make the sharing of the premiums
proportionate to the respective insurable
interests, the premium of the naked
owner being based on the insurable
interest of the naked ownership; that of
the usufructuary being based on the
insurable interest of the usufruct (2
PARAS, supra at 636).
NOTE: Article 608 is silent where the
usufructuary alone pays the insurance or,
where both share in the payment thereof, as
to the proportion of their contribution to the
insurance (DE LEON, Property, supra at
502).
Rules applicable to Art. 608:
i. The insurance indemnity (which cannot
be more than the value of the usufruct)
goes to the usufructuary alone, with no
obligation on his part to share the
indemnity with, nor to give legal interest
thereon to, the naked owner;
ii. The usufruct continues on the land for
the remaining period of the usufruct
(unless the usufruct had been
constituted on the building alone); and
iii. The usufructuary has no obligation to
construct a new building or to rebuild
(whether the usufruct was constituted on
the building alone, or on both the building
and the land). The usufructuary surely
cannot be compelled to rebuild because
the insurance indemnity will be much
less than the cost of the building (2
PARAS, supra at 634).
NOTE: A contrary stipulation between
the
parties will prevail over the foregoing
rules (Id.).
Payment of Insurance on the Tenement Held
in Usufruct (CIVIL CODE, Art. 608)
a. If the naked owner and usufructuary share in
the premiums (and the property is
destroyed):
i. If the owner constructs a new building,
the usufruct continues on the new
building.
1.) If the cost of the building is less than
the insurance indemnity, the
usufructuary should get legal
interests on the difference.
2.) If the cost is more than the insurance
indemnity, the usufructuary enjoys
the new building completely, with no
obligation to give interest on the
additional cost of the naked owner (4
MANRESA 542-543 as cited in 2
PARAS, supra at 542-543).
ii. If the naked owner does not construct a
new building or rebuild, the naked owner
gets the insurance indemnity but should
pay the interest thereon to the
usufructuary (Id. at 643).
b. If the naked owner alone pays the insurance
and the usufructuary refused to share:
i. The naked owner gets the whole
indemnity (with the obligation to give the
interest thereon to the usufructuary).
ii. If the usufruct was on the building and
the land, the usufruct continues on the
land and the materials (CIVIL CODE, Art.
644).
iii. If the usufruct was on the building alone
the naked owner may rebuild, with or
without the approval of the usufructuary,
but he must pay interest on the value of
the land and the old materials that may
have been used (CIVIL CODE, Art. 607;
2 PARAS, supra at 638).
c. If the naked owner alone paid for the
insurance but there is failure or omission of
usufructuary to share (Id. at 644).
NOTE: The effect is the same as if there was
a sharing, but the usufructuary must
reimburse the naked owner of the
usufructuary’s share of the insurance
premium (4 MANRESA 546 as cited in 2
PARAS, supra at 644).
d. If the usufructuary alone pays the insurance
premium:
i. The insurance indemnity goes to the
usufructuary alone, with no obligation on
his part to share the indemnity with, nor
to give legal interest thereon to, the
naked owner.
ii. The usufruct continues on the land for
the remaining period of the usufruct.
iii. The usufructuary has no obligation to
construct a new building or to rebuild (Id.
at 644).
3. As to advances and damages
a. To be reimbursed for indispensable
extraordinary repairs made by him in an
amount equal to the increase in value which
the property may have acquired by reason of
such repairs (CIVIL CODE, Art. 594);
 What constitutes as “extraordinary
repairs”
i. Those required by the wear and tear due
to the natural use of the thing but not
indispensable for its preservation;
ii. Those required by the deterioration of or
damage to the thing caused by
exceptional circumstances but not
indispensable for its preservation; and
iii. Those required by the deterioration of or
damage to the thing caused by
exceptional circumstances and are
indispensable for its preservation (DE
LEON, Property, supra at 444).
Requisites before the usufructuary may
make extraordinary repairs: (No-FaiN)
c. There must be due Notification to naked
owner of urgency;
d. The naked owner Failed to make them;
and
e. The repair is Needed for preservation (2
PARAS, supra at 618).
Right of Usufructuary Who Has Made
Extraordinary Repairs:
i. Get increase in value (CIVIL CODE, Art.
594) or get reimbursement of expenses
(CIVIL CODE, Art. 612); and
ii. Right of retention until paid (CIVIL
CODE, Art. 612).
b. To be reimbursed for taxes on capital
advanced by him (CIVIL CODE, Art. 597);
The naked owner pays for taxes imposed
directly on the capital (provided they are not
annual — example, the estate tax) (2
PARAS, supra at 621).
If advanced (in the meantime) by the
usufructuary, said usufructuary:
i. Should be reimbursed the amount paid
without legal interest:
1.) If the advance was made voluntarily
the reimbursement shall be made at
the termination of the usufruct; or
2.) If the usufructuary was forced to pay,
the reimbursement should be made
thereafter (Id.).
ii. Is entitled to retention until paid (CIVIL
CODE, Art. 612; 2 PARAS, supra at
621).
c. To be indemnified for damages caused to
him by the naked owner (CIVIL CODE, Art.
581); and
The naked owner may alienate the property
in usufruct because the title (dominium
directum) remains vested in him but he
cannot:
i. Alter the form or substance of the
property; and
ii. Do anything thereon which may cause a
diminution in the value of the usufruct or
be prejudicial to the rights of the
usufructuary.
Otherwise, he would be liable for damages
under Art. 581.
Illustration:
i. In case of double sale of the usufructuary
right, Art. 1544 relating to a double sale
applies. Thus, if the second buyer in
good faith registers the usufruct, he can
oust the first buyer who did not register,
even though the latter be in possession.
The right of the first usufructuary
would be to proceed against the naked
owner for breach of the warranty against
eviction;
ii. In case of succession, if the naked owner
bequeaths (if personal property) or
devises (if real property) to another
through a will, the legatee or devisee
should respect the usufruct;
iii. In case the property subject of the
usufruct is sold to another, the buyer
must respect the usufruct in case it is
registered or known to him, otherwise, he
can oust the usufructuary, who can then
look to the naked owner for damages (2
PARAS, supra at 601-602).
d. To remove improvements made by him if the
same will not injure the property (CIVIL
CODE, Art. 579).
NOTE: While a possessor in good faith is
entitled to a refund for useful improvements,
a usufructuary is not (2 PARAS, supra at
600).

OBLIGATIONS OF THE
USUFRUCTUARY
(ARTS. 583-602)
SUMMARY OF THE OBLIGATIONS OF
THE USUFRUCTUARY:
1. Before the duration of the usufructuary:
a. To make an inventory of the property (CIVIL
CODE, Art. 583); and
b. To give security (CIVIL CODE, Art. 583).
2. During the usufructuary:
a. To take care of the property as a good father
of a family (CIVIL CODE, Art. 589);
b. To answer for the acts of the substitute
(CIVIL CODE, Art. 590) without prejudice to
his right of action against latter;
c. To replace with the young thereof animals
that die or are lost when the usufruct is
constituted on flock or herd of livestock
(CIVIL CODE, Art. 591);
d. To make ordinary repairs (CIVIL CODE, Art.
592, Par.1);
e. To permit works and improvements by the
naked owner not prejudicial to the usufruct
(CIVIL CODE, Art. 595);
f. To pay annual taxes and charges on the
fruits (CIVIL CODE, Art. 596);
g. To pay interest on taxes on capital paid by
the naked owner (CIVIL CODE, Art. 597);
h. To pay debts when the usufruct is constituted
on the whole patrimony (CIVIL CODE, Art.
598);
i. To secure the naked owner’s or court’s
approval to collect credits in certain cases.
(CIVIL CODE, Art. 599);
j. To notify the owner of any prejudicial act
committed by third persons (CIVIL CODE,
Art. 601); and
k. To pay expenses, costs, and liabilities in suits
brought with regard to the usufruct (CIVIL
CODE, Art. 602).
3. At the termination of the usufruct:
a. To return the thing in usufruct to the owner
unless there is a right of retention (CIVIL
CODE, Art. 612);
b. To pay legal interest on the amount spent by
the owner for extraordinary repairs or taxes
on the capital (CIVIL CODE, Arts. 594 and
597); and
c. To indemnify the owner for any loss due to
his negligence or of his transferees (CIVIL
CODE, Arts. 589 and 590).
OBLIGATIONS OF THE USUFRUCTUARY
BEFORE EXERCISING THE USUFRUCT:
1. To make an inventory of all the property
(CIVIL CODE, Art. 583(1)); and
The usufructuary, before entering upon the
enjoyment of the property, is obliged to make,
after notice to the owner or his legitimate
representative, an inventory of all the property,
which shall contain an appraisal of the movables
and a description of the condition of the
immovables (CIVIL CODE, Art. 583(1)).
NOTE: The inventory is merely a condition to be
complied with before the usufructuary may enter
into possession and enjoyment of the property (2
PARAS, supra at 604).
Requirements for the making of inventory:
(NDMAE)
a. The owner (or his legitimate representative)
must be previously Notified to enable him to
correct errors in the inventory, if he desires;
NOTE: The law says legitimate, not legal
representative, so that notice may be given
in proper cases to the owner’s parents,
spouse, guardian, administrator, or agent
(DE LEON, Property, supra at 449).
Effect of Non-Notification: The inventory
can go on but the naked owner may later
point out discrepancies and omissions in the
inventory (4 MANRESA 450-452 as cited in
DE LEON, Property, supra at 450).
b. The condition of the immovables must be
Described;
c. The Movables must be Appraised;
d. Expenses are to be borne by the
usufructuary, since the duty is his (2 PARAS,
supra at 611).
As a rule, no form is required except that
when there are real properties, Art. 1358
demands a public instrument to affect third
parties (Id.).
When Inventory is NOT Required:
a. When no one will be injured thereby (CIVIL
CODE, Art. 585), provided the naked owner
consents;
b. In case of waiver by the naked owner or the
law; or
c. When there is stipulation in a will or contract
(2 PARAS, supra at 612).
2. To give security (CIVIL CODE, Art. 583)
The usufructuary, before entering upon the
enjoyment of the property, is obliged to give
security, binding himself to fulfill the obligations
imposed upon him (CIVIL CODE, Art. 583).
This article does not apply if the usufructuary is
exempted from giving security. It applies only if
he is required but cannot afford to give security
(2 PARAS, supra at 618).
NOTE: Since the law does not specify what
kind of security should be given, it follows that
any kind of sufficient security should be allowed
— such as a cash or personal bond, mortgage,
etc. (Id.).
GENERAL RULE: The usufructuary has the
obligation to give security, binding himself to fulfill
the obligations imposed upon him in accordance
with the Civil Code.
EXCEPTIONS:
a. When no one will be injured thereby (CIVIL
CODE, Art. 585);
b. When there is waiver by the naked owner,
(4 MANRESA, supra at 464-467) or there is
a stipulation either in a will or by contract;
c. When the usufructuary is the donor of the
property who has reserved the usufruct
(CIVIL CODE, Art. 584);
d. When there is a parental usufruct, i.e., in the
case of parents who are usufructuaries of
their children’s property (FAMILY CODE, Art.
225); and
e. In cases of caucion juratoria (CIVIL CODE,
Art. 587; 2 PARAS, supra at 617).
Caucion juratoria is a promise under oath to
take good care of the property and return the
same at the end of the usufruct. It takes the
place of a bond or security and is based on
necessity and humanity (Id.).
NOTE: In this kind of usufruct, the
usufructuary has no right to alienate his
usufructuary right or lease the same for that
would mean that he does not need the house
or the furniture or the implements (Id.).
Requisites Before Caucion Juratoria is
Allowed: (PANS)
i. Proper court petition;
ii. Approval of the court;
iii. Necessity for delivery of furniture,
implements or house included in the
usufruct; and
iv. Sworn promise (Id.).
Retroactive Effect of Security
After the security has been given by the
usufructuary, he shall have a right to all the
proceeds and benefits from the day on which, in
accordance with the title constituting the usufruct,
he should have commenced to receive them
(CIVIL CODE, Art. 588).
Illustration: If the usufruct commences January
3, 2014 but security is given March 3, 2014, the
usufructuary is entitled to all the proceeds and
benefits of the usufruct from January 3, 2014.
EFFECTS OF FAILURE TO GIVE
SECURITY IF NOT EXEMPTED (CIVIL
CODE, ART. 586):
a. On the rights of the naked owner
i. He may deliver the property to the
usufructuary;
ii. He may choose retention of the property
as administrator;
iii. He may demand receivership or
administration (by another) of the real
property, sale of movable, conversion or
deposit of credit instruments, or
investment of cash or profits (2 PARAS,
supra at 609);
iv. He may demand that the movables be
sold;
v. He may demand that the credit
instrument be converted into regular
certificate of deposit; or
vi. He may demand that the cash and
credits be invested in safe securities
(DE LEON, Property, supra at 452).
b. On the rights of the usufructuary
i. He cannot possess the property until he
gives security;
ii. He cannot administer the property;
hence, he cannot execute a lease
thereon (2 PARAS, supra at 616);
iii. He cannot collect credits that have
matured, nor invest them unless the
Court or the naked owner consents
(CIVIL CODE, Art. 599);
iv. But the usufructuary can alienate his
right to the usufruct. The grantee may
possess the same from the moment he
gives security (2 PARAS, supra at 616).
NOTE: If the movable be sold, the cash
belongs to the naked owner, but the interest
thereon (6% per annum) belongs to the
usufructuary (Id.).
OBLIGATIONS OF THE USUFRUCTUARY
DURING THE USUFRUCT
1. To take care of the property as a good
father of a family (CIVIL CODE, Art. 589);
The usufructuary shall take care of the things
given in usufruct as a good father of a family
(CIVIL CODE, Art. 589).
 Effect of Bad Use of the Property Held in
Usufruct (CIVIL CODE, Art. 610):
a. If bad use does not cause considerable injury
to the naked owner, usufruct continues, and
the naked owner cannot demand
administration by himself.
b. If bad use causes considerable injury to the
naked owner, usufruct continues but the
naked owner can demand delivery to and
administration by him, but he will be obliged
to pay net proceeds to the usufructuary (2
PARAS, supra at 646).
Being merely an administrator, he cannot sell or
alienate the right to the usufruct, though he may
still alienate the property, without prejudice to the
usufruct (Id. at 647).
NOTE: The Court will determine whether or not
there is considerable injury to the naked owner (4
MANRESA, supra at 548-549 as cited in 2
PARAS, supra at 647).
2. To make ordinary repairs (CIVIL CODE, Art.
592, Par.1);
The usufructuary is obliged to make the ordinary
repairs needed by the thing given in usufruct
(CIVIL CODE, Art. 592, Par. 1).
Ordinary repairs are understood such as are
required by the wear and tear due to the natural
use of thing and are indispensable for its
preservation (CIVIL CODE, Art. 592, Par. 2).
For the usufructuary to be responsible for
ordinary repairs, the following must concur:
(NPOF)
a. They are required by the wear and tear due
to the Normal or natural use of the thing;
b. They are indispensable for Preservation;
c. They must have Occurred during the
existence of the usufruct; and
d. They must have happened with or without the
Fault of the usufructuary (2 PARAS, supra at
622).
NOTE: If naked owner had demanded the repair,
and the usufructuary still fails to do so, the owner
may make them (personally or through another)
at the expense of the usufructuary (CIVIL CODE,
Art. 592, Par.2).
Exemption from the duty to make or pay for
the necessary repairs by renouncing the
usufruct:
a. If the usufructuary had no fault, he can
renounce, but he must surrender the fruits
received.
b. If he had fault, he cannot renounce. He would
still be liable for damages (2 PARAS, supra
at 622).
3. To notify the owner of urgent extra-
ordinary repairs (CIVIL CODE, Art. 593);
Extraordinary repairs shall be at the expense of
the owner. The usufructuary is obliged to notify
the owner when the need for such repairs I urgent
(CIVIL CODE, Art. 593).
Kinds of extra-ordinary repairs:
a. Those caused by natural use but not needed
for preservation.
i. The naked owner should be held liable,
whether or not he is notified by the
usufructuary.
ii. The law does not require the naked
owner to make them; what is important is
that he will bear the expenses made by
the usufructuary (2 PARAS, supra at
624).
b. Those caused by abnormal or exceptional
circumstances and needed for
preservation.
i. The naked owner shall be held liable.
ii. The usufructuary is allowed to make
them, with the right to get the increase in
value and the right of retention (until
paid) at the termination of the usufruct,
provided that there was notification by
the usufructuary and failure to repair by
the naked owner (Id.).
c. Those caused by abnormal or exceptional
circumstances but are not needed for
preservation.
i. The naked owner is responsible.
ii. The usufructuary cannot compel the
naked owner to make such repairs and
he is not allowed to make them even if
the naked owner has failed to make them
(Id.).
4. To answer for the acts of the substitute
(CIVIL CODE, Art. 590) without prejudice
to his right of action against latter;
A usufructuary who alienates or leases his right
of usufruct shall answer for any damage which
the things in usufruct may suffer through the fault
or negligence of the person who substitutes him
(CIVIL CODE, Art. 590).
REASON: It is the duty of the usufructuary to
preserve the form and substance of the thing in
usufruct (DE LEON, Property supra at 455).
NOTE: Even when there is a sub-usufructuary, it
is still the usufructuary who answers to the naked
owner for ordinary repairs, taxes on the fruits, etc.
(2 PARAS, supra at 619).
5. To replace with the young thereof
animals that die or are lost from natural
causes or due to rapacity of beasts or
prey when the usufruct is constituted on
flock or herd of livestock (CIVIL CODE, Art.
591);
If the usufruct be constituted on a flock or herd of
livestock, the usufructuary shall be obliged to
replace with the young thereof the animals that
die each year from natural causes or are lost due
to the rapacity of beasts of prey (CIVIL CODE,
Art. 591).
REASON: This obligation is related to the need
to preserve the form and substance of the
animals, i.e., the same number and condition (DE
LEON, Property, supra at 484).
NOTE: Sterile animals cannot be replaced and
shall be treated as fungible (CIVIL CODE, Art.
591, Par. 4).
(For further discussion, see the section on
Special Usufructs, particularly on Art. 591).
6. To permit works and improvements by
the naked owner not prejudicial to the
usufruct (CIVIL CODE, Art. 595);
The owner may construct any works and make
any improvements of which the immovable in
usufruct is susceptible, or make new plantings
thereon if it be rural, provided that such acts do
not cause a diminution in the value of the usufruct
or prejudice the rights of the usufructuary (CIVIL
CODE, Art. 595).
Although the property is in the possession of the
usufructuary, the naked owner may still —
a. Construct works;
b. Make improvements; and
c. Make new plantings (if rural)
Provided:
a. The value of the usufruct is not diminished;
or
b. The right of the usufructuary is not prejudiced
(CIVIL CODE, Art. 595).
Effect of Increase in the Value of the Usufruct
a. The usufructuary’s profits will increase (for he
will be entitled to the use and profits thereof);
b. The usufructuary does not have to pay legal
interest on the improvement (2 PARAS,
supra at 619).
7. To pay annual taxes and charges and of
those considered as a lien on the fruits
(CIVIL CODE, Art. 596);
The payment of annual charges and taxes and of
those considered as a lien on the fruits, shall be
at the expense of the usufructuary for all the time
that the usufruct lasts (CIVIL CODE, Art. 596).
CHARGES OR TAXES TO BE PAID
CHARGE OWNER USUFRUCTUARY
Expenses
affecting the
fruits
Land taxes
Taxes levied
on the capital
What Charges or Taxes the Usufructuary
Must Pay:
a. The annual charges (in the fruits);
b. The annual taxes on the fruits; and
c. Theoretically, annual taxes on the land
(including real estate tax) should also be paid
by the usufructuary (2 PARAS, supra at 626-
627).
NOTE: A real property tax, being a burden upon
the capital, should be paid by the owner of the
land, and not by a usufructuary (Board of
Assessment Appeals of Zamboanga del Sur v.
Samar Mining Company, G.R. No. L-28034,
February 27, 1971).
Other Charges on the Fruits the Usufructuary
Must Pay:
a. Ordinary repairs; and
b. Necessary cultivation expenses (2 PARAS,
supra at 621).
8. To pay interest on taxes on capital paid
by the naked owner (CIVIL CODE, Art.
597);
The taxes which, during the usufruct, may be
imposed directly on the capital, shall be at the
expense of the owner.
If the latter has paid them, the usufructuary shall
pay him the proper interest on the sums which
may have been paid in that character; and, if the
said sums have been advanced by the
usufructuary, he shall recover the amount thereof
at the termination of the usufruct (CIVIL CODE,
Art. 597).
 The naked owner pays for the taxes imposed
directly on the capital provided they are not
annual (2 PARAS, supra at 626).
Rules regarding payment of interest on taxes
on capital:
a. If paid by the naked owner, he can demand
legal interest on the sum paid (CIVIL CODE,
Art. 597, Par. 2);
b. If advanced (in the meantime) by the
usufructuary, said usufructuary –
i. Should be reimbursed the amount paid
without legal interest.
ii. Is entitled to retention until paid (CIVIL
CODE, Art. 612).
9. To pay debts when the usufruct is
constituted on the whole patrimony
(CIVIL CODE, Art. 598);
NOTE: See discussion on Special Usufructs,
particularly on Art. 598.
10. To secure the naked owner’s or court’s
approval to collect credits in certain
cases (CIVIL CODE, Art. 599);
The usufructuary may claim any matured credits
which form a part of the usufruct if he has given
or gives the proper security. If (1) he has been
excused from giving security or (2) has not been
able to give it, (3) or if that given is not sufficient,
he shall need the authorization of the owner, or
of the court in default thereof, to collect such
credit (CIVIL CODE, Art. 599).
Rules:
a. If the usufructuary has given security,
collection and investment can be done
without the approval or the court or of the
naked owner.
b. If he has not given security, or when he is
exempted or when there was only a caucion
juratoria, collection and investment can be
done only with the approval of the court or
the naked owner.
If the credit is collected, the same belongs to the
naked owner, but the usufructuary gets its
usufruct.
Failure to collect due to usufructuary’s fault or
negligence makes the usufructuary liable if the
credit has matured (2 PARAS, supra at 624).
11. To notify the owner of any prejudicial act
committed by third persons (CIVIL CODE,
Art. 601); and
The usufructuary shall be obliged to notify the
owner of any act of a third person, of which he
may have knowledge that may be prejudicial to
the rights of ownership, and he shall be liable
should he not do so, for damages, as if they had
been caused through his own fault (CIVIL CODE,
Art. 601).
12. To pay for court expenses and costs
regarding usufruct (CIVIL CODE, Art.
602).
The expenses, costs, and liabilities in suits
brought with regard to the usufruct shall be borne
by the usufructuary (CIVIL CODE, Art. 602).
This article particularly applies only when the
usufructuary has lost the case (2 PARAS, supra
at 626).
NOTE: Since the expenses, costs and liabilities
mentioned are incurred in connection with
litigation over the possession, use and enjoyment
of the thing in usufruct affecting the rights of the
usufructuary, it is just that they are borne by him.
Of course, if the litigation involves only the naked
ownership, the owner should assume them (DE
LEON, Property, supra at 492).
OBLIGATIONS AT THE TERMINATION
OF THE USUFRUCT: (RPI)
1. To Return the thing in usufruct to the owner
unless there is a right of retention (CIVIL CODE,
Art. 612);
2. To Pay legal interest on the amount spent by the
owner for extraordinary repairs or taxes on the
capital (CIVIL CODE, Arts. 594 and 597); and
3. To Indemnify the owner for any losses due to his
negligence or of his transferees (CIVIL CODE,
Arts. 589 and 590).
RIGHTS AND
OBLIGATIONS OF THE
NAKED OWNER
RIGHTS OF THE OWNER DURING THE
USUFRUCT: (RAC)
1. He Retains title;
2. He may Alienate the property, but he may not:
a. Alter the form or substance of the thing; or
b. Do anything prejudicial to the usufructuary
(CIVIL CODE, Art. 581).
3. He may Construct buildings, make improvements
and plantings, provided:
a. That such acts do not cause a diminution in
the value of the usufruct; or
b. That such acts do not prejudice the right of
the usufructuary (CIVIL CODE, Art. 595).
OBLIGATIONS OF THE OWNER DURING
THE USUFRUCT: (RCR)
1. To make Reimbursement for advances of the
usufructuary (CIVIL CODE, Art. 597);
2. To Cancel the security, upon discharge of the
usufructuary’s obligations (CIVIL CODE, Art.
612); and
3. To Respect leases of rural lands by the
usufructuary for the balance of the agricultural
year (CIVIL CODE, Art. 572).
EXTINGUISHMENT OF
USUFRUCT
(ARTS. 603-612)
SUMMARY OF EXTINGUISHMENT OF
USUFRUCT:
Usufruct is extinguished: (DEM-RTT-P)
1. By the Death of the usufructuary, unless a
contrary intention clearly appears;
2. By the Expiration of the period for which it was
constituted, or by the fulfillment of any resolutory
condition provided in the title creating the
usufruct;
3. By Merger of the usufruct and ownership in the
same person;
4. By Renunciation of the usufructuary;
5. By the Total loss of the thing in usufruct;
6. By the Termination of the right of the person
constituting the usufruct; or
7. By Prescription (CIVIL CODE, Art. 603).
MODES OF EXTINGUISHMENT OF
USUFRUCT: (DEM-RTT-PO) (CIVIL CODE,
Art. 603):
1. Death of the usufructuary.
GENERAL RULE: Death of the usufructuary
generally ends the usufruct.
This is true even if a resolutory condition or period
has been stipulated and death occurs before the
expiration of the period or fulfillment of the
condition (DE LEON, Property, supra at 465).
NOTE: It is the death of the usufructuary which
generally results in the termination of the
usufruct. Hence, the death of the naked owner
will not extinguish the usufruct unless the parties
expressly so stipulate (RABUYA, Property, supra
at 497).
EXCEPTIONS:
a. A usufruct constituted in favor of several
persons living at the same time shall not be
extinguished until the death of the last
survivor (CIVIL CODE, Art. 611);
Rule in Case of Multiple Usufruct (CIVIL
CODE, Art. 611)
i. If constituted simultaneously, it is
evident that all the usufructuaries must
be alive at the time of the constitution.
The death of the last survivor
extinguishes the usufruct.
ii. If constituted successively, Art. 611
also applies. However, to constitute
successive usufructs, it is essential that:
1.) If the successive usufructs were
constituted by virtue of a donation,
all the donee-usufructuaries must be
living at the time of the constitution-
donation of the usufruct (CIVIL
CODE, Art. 756).
2.) If the successive usufructs were
constituted by virtue of a last will,
there should be only 2 successive
usufructuaries; and both must have
been alive at the time of the
testator’s death (CIVIL CODE, Arts.
863 and 869; 2 PARAS, supra at
647-648).
NOTE: The owner of the property imposed
as condition for the continuation of the
usufruct over the property by his kins that
they should maintain an atmosphere of
cooperation, live in harmony and avoid
bickering. There was a continuing animosity
among the kins, hence, it is a ground for
termination of the usufruct. The deterioration
of the relations of the kins to an almost
irretrievable level is a good reason for the
termination of the usufruct (Moralidad v.
Pernes, G.R. No. 152809, August 3, 2006).
b. In case there is a period fixed based on the
number of years that would elapse before a
person would reach a certain age, unless the
period was expressly granted only in
consideration of the existence of such
person, in which case it ends at the death of
said person (CIVIL CODE, Art. 606); and
c. In case the contrary intention clearly appears
(4 MANRESA 525-528 as cited in 2 PARAS,
supra at 635).
2. Expiration of the period or fulfillment of
the resolutory condition.
If the usufructuary is a juridical person, the term
should not exceed 50 years (CIVIL CODE, Art.
605).
 Premature abandonment or dissolution of the
juridical entity extinguishes the usufruct (CIVIL
CODE, Art. 605).
3. Merger of the usufruct and ownership in
the same person.
Takes place when the rights of usufruct and
owner are acquired by one and the same person
who becomes the absolute owner of the property
(DE LEON, Property, supra at 467).
Illustration: H was the usufructuary of land
owned by X. X died, leaving in his will, the naked
ownership of the land to H. The usufruct is
extinguished because now, H is both the naked
owner and the usufructuary (2 PARAS, supra at
629).
4. Renunciation of the usufructuary.
The surrender of the rights as usufructuary refers
to a voluntary surrender of the very rights which
the usufructuary has, made by him with the intent
to so surrender them (City of Manila v. Monte de
Piedad, G.R. No. 1975, Nov. 10, 1905).
NOTE: It is really an abandonment by the
usufructuary of his right and does not, therefore,
require the consent of the naked owner but it is
subject to the rights of creditors (DE LEON,
Property, supra at 496).
5. Total loss of the thing.
GENERAL RULE: A total loss would result to the
extinguishment of the usufruct. A thing is lost
when it perishes, or goes out of commerce, or
disappears in such a manner that its existence is
unknown or it cannot be recovered. Hence, loss
may either be physical or juridical (RABUYA,
Property, supra at 499).
EXCEPTIONS:
a. If the usufruct is constituted on a building and
the latter is destroyed without the fault of the
usufructuary, the usufruct is not extinguished
and Arts. 607-608 would apply; and
b. If the property held in usufruct was
expropriated for public use, the usufruct is
not extinguished.
Rule in Case of Expropriation (CIVIL CODE,
Art. 609):
a. If the naked owner alone was given the
indemnity, he has the option to:
i. Replace with equivalent thing; or
ii. Pay to the usufructuary legal interest on
the indemnity, with the obligation to give
security for the payment of interest.
b. If both the naked owner and the usufructuary
were separately given indemnity, each own
the indemnity given to him, the usufruct being
totally extinguished.
c. If the usufructuary alone was given the
indemnity, he must give it to the naked owner
and compel the latter to return either the
interest or to replace the property. He may
even deduct the interest himself, if the naked
owner fails to object (2 PARAS, supra at 645
- 646).
NOTE: A usufruct is not extinguished by bad use
of the thing held in usufruct (RABUYA, Property,
supra at 500).
6. Termination of right of the person
constituting the usufruct.
The termination refers to the right of the person
constituting the usufruct, not to a condition
imposed upon the usufruct itself. Thus, if a
person constituted the usufruct with the belief
that he was the owner but was later defeated in
an action concerning its ownership, it follows that
the usufruct must also terminate (DE LEON,
Property, supra at 497).
a. If the usufructuary has a sub-usufructuary,
the latter ends at the time the usufruct is
extinguished;
b. Death of the naked owner does not
extinguish the usufruct for the rights of the
naked owner are transmitted to his own heirs
(2 PARAS, supra at 637).
7. Prescription.
a. This refers to the acquisitive prescription
(CIVIL CODE, Arts. 1006 and 1117) by a
stranger either of the usufruct or of the naked
ownership (CIVIL CODE, 603(7)).
b. Mere non-use of the usufructuary does not
terminate the usufruct, unless it is also a
renunciation (2 PARAS, supra at 631).
8. Other causes
a. Annulment/rescission of contract;
b. Mutual consent;
c. Attainment of age of majority of a child whose
property is under parental usufructuary
(FAMILY CODE, Arts. 225 and 226); and
d. Other legal causes resulting in the
termination of the usufruct (2 PARAS, supra
at 631).

EASEMENT OR
SERVITUDE
(ARTS. 613-693)
EASEMENT
An easement or servitude is an encumbrance
imposed upon an immovable for the benefit of
another immovable belonging to a different owner
(CIVIL CODE, Art. 613). However, servitudes may
also be established for the benefit of a community, or
of one or more persons to whom the encumbered
estate does not belong (CIVIL CODE, Art. 614).
2. It is enjoyed over another immovable,
The other aspect of easement or servitude refers to
the right of servitude (jus servitutes), or the right
which corresponds to the burden imposed. From
this viewpoint, an easement or servitude may thus be
defined as “a real right, constituted on the corporeal
immovable property of another, by virtue of which the
owner has to refrain from doing, or must allow
someone to do, something on his property, for the
benefit of another thing or person” (RABUYA,
Property, supra at 502).
While Article 613 speaks of a real easement,
Article 614 speaks of a personal easement. Both
however are real rights, but will prejudice third
persons only if duly registered (2 PARAS, supra at
652).
EASEMENT V. SERVITUDE
EASEMENT SERVITUDE
As to Origin
Derived from Common Derived from Roman
3. It involves two neighboring estates (in
law. Law.
As to Recipient of Benefit
Always real. May be real or
personal.
As to Concept
Right enjoyed by one. Burden imposed upon
the other.
(Id. at 651; RABUYA, Property, supra at 502).
4. It is inseparable from the estate to which
NOTE: As used in the Civil Code, easement is
equivalent to servitude (2 PARAS, supra at 650).
CHARACTERISTICS:
1. It is a real right but will affect third persons
only when duly registered;
NOTE: Easement is a real right since the right is
constituted on the thing itself and not upon its
owner or its occupant (RABUYA, Property, supra
at 502).
As a consequence, the right avails against every
person whomsoever, who may happen, for the
time being, to have any interest in the thing, or,
as adverse possessor, to exercise a right of
dominion over it. The right consists of a limited
use and enjoyment of the thing without
possession and gives rise to an action in rem in
favor of the owner of the tenement of the
easement and against any possessor of the
servient estate (Id.).
never on one’s own property;
It operates as a limitation on the title of the owner
of the servient estate, specifically, his right to
use (jus utendi). Inasmuch as every easement
or servitude is a limitation upon one’s ownership,
it follows that no man has a right of servitude in a
thing of which he is the owner: Nulli res sua servit.
For if he had, he would have a right in the thing
against himself: which is, of course, absurd
because things serve their owner by reason of
ownership and not because of any servitude (Id.
at 503).
Note: The term “immovable,’’ as used in the
law, must be understood in its common and not
in its legal sense. What the law treats of are not
all immovables as defined by the Civil Code, but
only those which are so by their nature (are really
incapable of being moved), such as lands, roads,
buildings, and constructions adhering to the soil
(DE LEON, Property, supra at 507).
case of real easements) - the dominant and
the servient estate (CIVIL CODE, Art. 613);
Dominant Estate
The immovable in favor of which the easement is
established (CIVIL CODE, Art. 613).
Servient Estate
That which is subjected to easement (CIVIL
CODE, Art. 613).
it is attached, and, therefore, cannot be
alienated or mortgaged independently of the
estate (CIVIL CODE, Art 617);
5. It is indivisible for it is not affected by the EASEMENT V. USUFRUCT
division of the estate between two or more
EASEMENT USUFRUCT
persons. (CIVIL CODE, Art. 618);
As to Scope
As a consequence, even if the servient and
dominant estates are divided between two or Imposed only on real May involve either real
more persons, the easement or the servitude property. or personal property.
continues to attach to the estates originally
affected (RABUYA, Property, supra at 515).
As to Use of Property
6. It is a right limited by the needs of the
Limited to particular or Includes all the uses
dominant owner or estate, without
specific use of the and the fruits of the
possession; servient estate. property.
7. It cannot consist in the doing of an act
unless the act is accessory in relation to a As to Right of Possession
real easement; and
8. It is a limitation on the servient owner’s rights A non–possessory right Involves a right of
of ownership for the benefit of the dominant over an immovable. possession in an
immovable or movable.
owner; and therefore, it is not presumed (DE
LEON, Property, supra at 478-479). As to Extinguishment
NOTE: It is an abnormal restriction on the Not extinguished by the Extinguished by the
property rights of the servient owner. Thus, it is death of the dominant death of the
incumbent upon the dominant estate owner to owner. usufructuary.
establish the presence of all the preconditions for
easement (Cristobal v. CA, G.R. No. 125339, As to Alienability
June 22, 1998).
Cannot be alienated. Generally, can be
EASEMENT V. LEASE alienated.

EASEMENT LEASE (Id. At 482; 2 PARAS, supra at 652).

As to Consideration Whether a Real Right SUMMARY OF EASEMENT

CLASSIFICATION
Real right, whether Real right only when it is
1. As to Recipient of Benefit:
registered or not. registered, or when its
a. Real/Predial; or
subject matter is real
b. Personal.
property and the
2. As to Source:
duration exceeds one
a. Voluntary;
year.
b. Legal; or
As to Scope c. Mixed.
3. As to Exercise
Imposed only on real May involve either real a. Continuous; or
property. or personal property. b. Discontinuous.
4. As to Indication of their existence
As to Limitation a. Apparent; or
b. Non-apparent.
There is a limited right Limited right to both the 5. As to the Duty of the Servient Estate
to the use of real possession and use of a. Positive; or
property of another but another’s property. b. Negative.
without the right of 6. As to the Right Given
possession. a. Partial use of servient estate;
(DE LEON, Property, supra at 481). b. Participation in ownership;
c. Prevention of servient estate from performing
a specific act of ownership; or
d. Acquisition of specific materials or objects
from the servient estate.
CLASSIFICATION OF EASEMENTS: intervention of any act of man (CIVIL CODE,
Art. 615).
1. As to recipient of benefit:
a. Real/ Predial – imposed upon an immovable
Example: Easement of aqueduct (CIVIL
for the benefit of another immovable
CODE, Art. 646)
belonging to a different owner (CIVIL CODE,
Art. 613).
NOTE: For an easement to be considered
“continuous,” its use does not have to be
Illustration: Easement of water where lower
incessant; it is enough that the use may be
estates are obliged to allow water naturally
incessant (DE LEON, Property, supra at
descending from upper estates to flow into
486).
them (CIVIL CODE, Art. 637).
b. Discontinuous Easements – those which
b. Personal – established for the benefit of a
are used at intervals and depend upon the
community, or of one or more persons to
acts of man (CIVIL CODE, Art. 615).
whom the encumbered estate does not
belong (CIVIL CODE, Art. 614).
Example: Easement of right of way which is
used at intervals, because it can be
Example: Easements of the right of way for
exercised only if a man passes over
the passage of livestock (CIVIL CODE, Art.
somebody else’s land (CIVIL CODE, Art.
657)
649, Par. 3; 2 PARAS, supra at 656)
NOTE: In a personal servitude, there is no
NOTE: The easement itself exists
“owner of a dominant tenement” to speak of,
continuously but its exercise may be
and the easement pertains to persons
continuous or discontinuous or there may be
without a dominant estate, in this case, the
no exercise at all (DE LEON, Property, supra
public at large (Solid Manila Corp. v. Bio
at 486).
Hong Co., Inc., G.R. No. 90596, April 8,
1991).
For legal purposes, the easement of
aqueduct is considered continuous, even
i. Public – if it is vested in the public at
though the flow of water may not be
large or in some class of indeterminate
continuous, or its use depends upon the
individuals.
needs of the dominant estate, or upon a
ii. Private – if it is vested in a determinate
schedule of alternate days or hours (CIVIL
individual or certain persons (DE LEON,
CODE, Art. 646).
Property, supra at 484).
NOTE: When the court says that an
2. As to its source: easement exists, it is not creating one
a. Voluntary – when the easement is (hence, there are no judicial easements). It
established by the will or agreement of the merely declares the existence of an
parties or by a testator (CIVIL CODE, Art. easement created by law or by the parties or
619; 2 PARAS, supra at 658); testator (La Vista Association, Inc. v. CA,
G.R. No. 95252, September 5, 1997).
Note: Voluntary easements must be
recorded in the Registry of Property to
4. As to the indication of their existence:
prejudice third persons (CIVIL CODE, Art.
a. Apparent Easements – those which are
708).
made known and are continually kept in view
by external signs that reveal the use and
b. Legal – when it is imposed by law either for
enjoyment of the same (CIVIL CODE, Art.
public use or in the interest of private persons
615).
(CIVIL CODE, Art. 619; 2 PARAS, supra at
658); and
Example: Easement of aqueduct, the
easement of aqueduct is always apparent,
c. Mixed – when it is created partly by will or
whether or not it can be seen (CIVIL CODE,
agreement and partly by law (CIVIL CODE,
Art. 646).
Art. 619; 2 PARAS, supra at 658).
NOTE: The mark or sign need not be seen
3. As to its exercise: but should be susceptible of being seen (DE
a. Continuous Easements – those the use of LEON, Property, supra at 486).
which are or may be, incessant without the
 b. Non–apparent Easements – those which
show no external indication of their existence
(CIVIL CODE, Art. 615).
Example: Easement of lateral and subjacent
support (2 PARAS, supra at 657)
5. As to duty of servient owner:
a. Positive – one which imposes upon the
owner of the servient estate the obligation of
allowing something to be done or of doing it
himself (CIVIL CODE, Art. 616).
Example: Easement of right of way which
imposes upon the owner of the servient
estate the duty to allow the use of said way.
b. Negative – one which prohibits the owner of
the servient estate from doing something
which he could lawfully do if the easement
did not exist (CIVIL CODE, Art. 616).
Example: Easement of light and view if
made on one’s own wall and the wall does
not extend over the property of another (DE
LEON, Property, supra at 488)
6. As to the right given:
a. Right to partially use the servient estate;
Example: Right of way
b. Right to get specific materials or objects from
the servient estate;
Example: Easement of drawing water
c. Right to participate in ownership; or
Example: Easement of party wall
d. Right to impede or prevent the neighboring
estate from performing a specific act of
ownership
Example: Easement of intermediate distances
as when the servient estate cannot plant trees
without observing certain distances (2 PARAS,
supra at 657-658).
MODES OF ACQUIRING
EASEMENT
(ARTS. 620-626)
MODES OF ACQUISITION: (TPDFA)
1. By Title
By “title’’, it does not necessarily mean document.
It refers to the juridical act or law sufficient to
create the encumbrance, such as law, donation,
contract, and will of the testator (2 PARAS, supra
at 665).
NOTE: The following easements may be
acquired only by title:
a. Continuous non-apparent easements;
b. Discontinuous apparent easements; and
c. Discontinuous non-apparent easements
(Id.).
2. By Prescription of 10 years irrespective of
the good or bad faith of the possessor and
whether or not he has just title. The only
requirement is adverse possession.
NOTE: Only continuous and apparent
easements can be acquired by prescription
(CIVIL CODE, Art. 620). They are the only ones
the possession of which fulfills two important
requisites required by law for prescription, to wit:
that the possession be public and continuous.
a. Positive servitude – computed from the day
on which the owner of the dominant estate,
or the person who may have made use of the
easement, commenced to exercise it upon
the servient estate (CIVIL CODE, Art. 621).
b. Negative servitude – computed from the
day on which the owner of the dominant
estate forbade, by an instrument
acknowledged before a notary public, the
owner of the servient estate, from executing
an act which would be lawful without the
easement (CIVIL CODE, Art. 621).
There must be a notarized document
executed by anyone who desires to establish
the easement. Thus, there is no easement for
as long as the dominant owner does not
exercise his right to prohibit servitude (CIVIL
CODE, Art. 621).
3. By Deed of recognition
The absence of document or proof showing origin
of an easement which cannot be acquired by
 prescription may be cured by a deed of
recognition by the owner of the servient estate or
by final judgment (CIVIL CODE, Art. 623).
c.
Easement exists even if acquired by oral contract
or by virtue of some document that has been lost
(DE LEON, Property, supra at 496).
(Resolme v. Lazo, G.R. No. L-8654, March
30, 1914);
To Renounce totally the easement if he
desires to exempt himself from contribution
to necessary expenses (CIVIL CODE, Art.
628; 2 PARAS, supra at 675); and

4. By Final judgment
NOTE: If the owner of the servient estate refuses
to execute the deed of recognition, the court may,
in its judgment, declare the existence of the
easement (Id. at 492).
5. By Apparent sign established by the owner
of two adjoining estates, unless at the time
the ownership of the two estates is divided:
a. There are contrary stipulations in the title of
conveyance of either of them; or
b. The sign is removed before the execution of
the deed (CIVIL CODE, Art. 624).
RIGHTS AND
OBLIGATIONS OF THE
PARTIES TO EASEMENTS
(ARTS. 627-630)
PARTIES:
1. Dominant owner
The owner of the immovable in favor of which the
easement is established (CIVIL CODE, Art. 613).
2. Servient owner
The owner of the immovable whose property is
subject to easement for the benefit of the
dominant owner (CIVIL CODE, Art. 613).
RIGHTS OF PARTIES:
1. Rights of a dominant owner: (MARE)
a. To Make on the servient estate all the works
necessary for the use and preservation of the
servitude, provided:
i. This must be at his own expense;
ii. He must notify the servient owner;
iii. Select most convenient time and manner
so as to cause the least inconvenience to
the servient owner; and
iv. He must not alter the easement nor
render it more burdensome (CIVIL
CODE, Art. 627).
b. To Ask for mandatory injunction to prevent
impairment of his use of the easement
d. To Exercise all the rights necessary for the
use of the easement (CIVIL CODE, Art. 625).
NOTE: If there be several owners of
dominant estate, expenses that will be
incurred in making the work shall be borne in
by all in proportion to the benefits which each
may derive therefrom (RABUYA, Property,
supra at 530).
OBLIGATIONS OF PARTIES
1. Obligations of a dominant owner:
(ABOUNCE)
a. He cannot Alter the easement or render it
more burdensome (CIVIL CODE, Art. 627);
b. He cannot use the easement except for the
Benefit of the immovable originally
contemplated (CIVIL CODE, Art. 626);
c. He cannot exercise the easement in any
Other manner than that previously
established (CIVIL CODE, Art. 626);
d. He may make any works or construct
anything which is necessary for the Use and
preservation of the servitude (CIVIL CODE,
Art 627, Par. 1);
e. He shall Notify the servient owner of works
necessary for the use and preservation of the
servitude (CIVIL CODE, Art. 627, Par. 2);
f. He must Choose the most convenient time
and manner in making the necessary works
as to cause the least inconvenience to the
servient owner (CIVIL CODE, Art. 627, Par.
2); and
g. He must contribute to the necessary
Expenses if there are several dominant
estates (CIVIL CODE, Art. 628, Par. 1).
NOTE: He may only exercise rights
necessary for use of easement (DE LEON,
Property, supra at 500).
2. OBLIGATIONS OF A SERVIENT OWNER:
(ICoRP)
a. He cannot Impair the use of the easement
(CIVIL CODE, Art. 629, par. 1);
b. Contribute to the necessary expenses in
case he uses the easement, unless there is
an agreement to the contrary (CIVIL CODE,
Art. 628, Par. 2);
 c. In case of impairment, to Restore conditions
to the status quo at his expense, plus
damages (3 SANCHEZ ROMAN, supra at
609); and
d. To Pay for the expenses incurred for the
change of location (CIVIL CODE, Art. 629,
par. 2).
EXTINGUISHMENT OF
EASEMENTS
(ARTS. 631-633)
MODES OF EXTINGUISHMENT OF
EASEMENTS IN GENERAL: (REMAIN-
BREW)
1. Redemption agreed upon between the
owners of the dominant and servient estates;
NOTE: Pertains to voluntary redemption.
2. Expiration of the term or fulfillment of the
resolutory condition;
Example: An easement was agreed upon to last
until the owner of the dominant easement
becomes a lawyer. When the condition is fulfilled,
the easement ceases (Id. at 686).
3. Merger of the ownership of the dominant and
servient estates;
A merger exists when ownership of the dominant
and servient estates is consolidated in the same
person. Merger then, as can be seen, requires
full ownership of both estates (Solid Manila
Corporation v. Bio Hong Co. Inc., G.R. No.
90596, April 8, 1991).
The merger must be absolute, complete, not
temporary (if it is temporary, there is only
suspension of easement) (4 MANRESA 467 as
cited in 2 PARAS, supra at 677).
4. Annulment of the title to the servitude;
5. Permanent Impossibility to use the
easement;
Mere impossibility to use the easement merely
suspends the same (RABUYA, Property, supra at
633).
To be permanent, the causes of the impossibility
of the use must be irreparable. If they are
reparable, the easement may still be
extinguished if the 10-year period by non-user
has already lapsed (Id.).
6. Non–use for 10 years;
Reckoning period:
a. Discontinuous easement - counted from
the day the easement ceased to be used
(CIVIL CODE, Art. 631 Par. 2).
b. Continuous easement - counted from the
day an act adverse to the exercise of
easement took place (CIVIL CODE, Art. 631,
Par. 2).
This mode is applicable only to easements that
have been in use and later abandoned, for one
cannot discontinue using what one has never
used (DE LEON, Property, supra at 507).
The proof of non-user must be indubitable and
this is particularly true if the easement of right of
way was annotated in the Torrens Title
(Benedicto v. CA, G.R. No. L-22733, September
25, 1968).
The non-user must be due to the dominant
owner’s voluntary abstention and not to fortuitous
event; otherwise, there is only suspension of
easement (2 TOLENTINO, Civil Code, supra at
376).
The running of the 10-year period will be
prevented by the use of the easement of any of
the co-owners of the dominant estate (CIVIL
CODE, Art. 633).
7. Bad condition
– when either or both estates fall into such a
condition that the easement could not be used;
NOTE: This merely suspends since possibility of
use revives the easement (CIVIL CODE, Art. 631
Par. 3).
8. Resolution of the right to create the
servitude, (i.e., in case of pacto de retro, when
the property is redeemed);
9. Expropriation of the servient estate; and
10. Waiver or renunciation by the dominant
owner.
Waiver or renunciation must be express, clear,
and specific (DE LEON, Property, supra at 504).
The mere fact that it has not been used at all
cannot give rise to the conclusion that there has
been a waiver (2 PARAS, supra at 680).
The sale of the dominant estate does not
extinguish the easement. There must be a
statement abolishing or extinguishing it. Hence,
 the use of the servient estate is continued by
operation of law (Tanedo v. Hon. Bernad, G.R.
No. 66520, August 30, 1988).
OTHER CAUSES FOR EXTINGUISHMENT
OF EASEMENT
1. Registration of the servient estate as free, i.e.,
although the servient estate was registered under
the Torrens system, the easement thereon was
not registered, unless there is a stipulation or
actual knowledge of the existence of easement
on the part of the transferee (Cid v. Irene P.
Javier, G.R. No. L-14116, June 30, 1960);
2. In the case of the legal easement of right of way,
the opening of an adequate outlet to the highway
extinguishes the easement, if the servient owner
makes a demand for such extinguishment (CIVIL
CODE, Art. 655).
LEGAL EASEMENTS
(ARTS. 634-687)
These are easements imposed by law which have for
their object either public use or the interest of private
persons (CIVIL CODE, Art. 634).
KINDS OF LEGAL EASEMENTS:
1. Public legal easements
– Those for public or communal use and
governed primarily by special laws and by the
Civil Code; and
2. Private legal easements
– Those for the interest of private persons or for
private use and governed
a. Primarily by the agreement of the interested
parties;
b. In the absence thereof, by the provisions of
general or local laws and ordinances; and
c. In default of (a) and (b), by Articles 634-687
of the Civil Code (DE LEON, Property, supra
at 514).
CLASSES OF PRIVATE LEGAL
EASEMENTS: (WaR-PaL- DraDiNuSu)
1. Easement relating to Waters (CIVIL CODE, Art.
637-648): (DARAD)
a. Easement of Drainage of waters (CIVIL
CODE, Art. 637; P.D. No. 1067, otherwise
known as Water Code of the Philippines, Art.
50 [hereinafter WATER CODE]);
b. Easement of Abutment of dam (CIVIL CODE,
Art. 639);
c. Easement on Riparian property (CIVIL
CODE, Art. 638; P.D. No. 1067, Art. 51);
d. Easement of Aqueduct (CIVIL CODE, Art.
642-646); and
e. Easement for Drawing water (CIVIL CODE,
Art. 640 and 641).
2. Easement of Right of way (CIVIL CODE, Art. 649-
657);
3. Easement of Party wall (CIVIL CODE, Art. 658-
666);
4. Easement of Light and view (CIVIL CODE, Art.
667-673);
5. Easement of Drainage of buildings (CIVIL CODE,
Art. 674-676);
6. Easement of Distances (CIVIL CODE, Art. 677-
681);
7. Easement of Nuisance (CIVIL CODE, Art. 682-
683); and
8. Easement of lateral and subjacent Support
(CIVIL CODE, Art. 684-687).
1. EASEMENT OF DRAINAGE OF
WATERS
NOTE: Art. 637 of the Civil Code has already
been superseded by Art. 50 of the Water Code.
Lower estates (servient estates) are obliged to
receive the waters which naturally and without
the intervention of man flow from the higher
estate (dominant estate), as well as the stone or
earth which they carry with them (WATER
CODE, Art. 50).
The owner of the lower estate cannot construct
works which will impede this natural flow, unless
he provides an alternative method of drainage
(WATER CODE, Art. 50).
Neither can the owner of the higher estate make
works which will increase this natural flow (DE
LEON, Property, supra at 515).
Right of higher estate to drain water
The owner of the higher estate has the right to
employ artificial means to drain water from higher
to lower land provided that:
a. He shall select the routes and methods that
will cause the minimum damage to the lower
lands; and
b. Pay just compensation (WATER CODE, Art.
46).
NOTE: Water right, such as the right to use a
drainage ditch for irrigation purposes, which are
appurtenant to a parcel of land, pass with
conveyance of the land, although not specifically
mentioned in the conveyance (Valisno v.
Adriano, G.R. No. L-37409, May 23, 1988).
 Q: X owns an agricultural land planted mostly
with fruit trees. Y owns an adjacent land devoted
to his piggery business, which is two (2) meters
higher in elevation. Although Y has constructed a
waste disposal lagoon for his piggery, it is
inadequate to contain the waste water containing
pig manure, and it often overflows and inundates
the plantation of X. This has increased the acidity
of the soil in the plantation, causing the trees to
wither and die. X sues for damages caused to
his plantation. Y invokes his right to the benefit of
a natural easement in favor of his higher estate,
which imposes upon the lower estate of X the
obligation to receive the waters descending from
the higher estate. Is Hernando correct?
ANS: No, Y is incorrect. As worded, Art. 637 of
the Civil Code in relation to Art. 50 of the Water
Code, imposes a natural easement upon the
`lower estate to receive the waters which
naturally and without the intervention of man
descend from higher states. However, where
the waters which flow from a higher state are
those which are artificially collected in man-
made lagoons, any damage occasioned
thereby entitles the owner of the lower or
servient estate to compensation. (Remman
Enterprises Inc. v. CA, G.R. No. 125018, April 6,
2000).
2. EASEMENT ON RIPARIAN
PROPERTY
4. EASEMENT FOR DRAWING WATER
NOTE: Art. 638, Par. 1 of the Civil Code has been
modified by Art. 51 of the Water Code. Article 51
of the Water Code states that the banks of rivers
and streams and the shores of the seas and lakes
throughout their entire length and within a zone
of three (3) meters in urban areas, twenty (20)
meters in agricultural areas, and forty (40)
meters in forest areas along their margins are
subject to the easement of public use in the
interest of recreation, navigation, floatage, fishing
and salvage.
Limitation: No person shall be allowed to stay in
this zone longer than what is necessary for
recreation, navigation, floatage, fishing or
salvage or to build structures of any kind
(WATER CODE, Art. 51).
Real Party in Interest
The proper party entitled to institute a case with
respect to the 3-meter strip/zone of Mahabang
Ilog Creek was the Republic of the Philippines
through the OSG and the local government of
Las Pinas City and not the subdivision developer
(Pilar Development Corp. v. Dumadag, G.R. No.
194336, March 11, 2013).
3. EASEMENT OF ABUTMENT OR
BUTTRESS OF A DAMOR ESTRIBO
DE PRESA (CIVIL CODE, Art. 639)
Whenever for the diversion of taking of water
from a river or book, or for the use of any
continuous or discontinuous stream, it should be
necessary to build a dam, and the person who is
to construct it is not the owner of the banks, or
lands which must support it, he may establish the
easement of abutment of a dam, after payment of
the property indemnity (CIVIL CODE, Art. 639).
A person may establish the easement of
abutment of a dam, provided that: (PIN2S)
a. The Purpose is to divert or take water from a
river or brook, or to use any other continuous
or discontinuous stream;
b. Payment of the proper Indemnity is made;
c. It is Necessary to build a dam;
d. The person to construct it is Not the owner of
the banks or lots which must support it; and
e. He must Seek the permission of the owner,
and in case of the latter’s refusal, he must
secure authority from the proper
administrative agency.
If the construction of the dam is unauthorized, it
can be considered a private nuisance; thus, it can
be lawfully removed (DE LEON, Property, supra
at 517).
AND WATERING ANIMALS (CIVIL
CODE, Arts. 640 and 641)
Compulsory easements for drawing water or for
watering animals can be imposed only for
reasons of public use in favor of a town or village,
after payment of the proper indemnity (CIVIL
CODE, Art. 640).
Requisites: (WIFIS)
a. The right of Way should have a maximum
width of 10 meters (4 MANRESA, supra at
722-723);
b. Must be Imposed for reasons of public use;
c. Must be in Favor of a town or village;
d. Indemnity must be paid; and
NOTE: The indemnity for easement of right
of way must also be included, because the
easement for drawing water carries with it the
easement of right of way (RABUYA,
Property, supra at 539).
e. Must be Sought not by one individual, but by
the town or village, through its legal
representation (4 MANRESA, supra at 722-
723).
5. EASEMENT OF AQUEDUCT (CIVIL
CODE, Arts. 642-646)
Any person who may wish to use upon his own
estate any water of which he can dispose shall
have the right to make it flow through the
intervening estates, with the obligation to
indemnify their owners, as well as the owners of
the lower estates upon which the waters may
filter or descend (CIVIL CODE, Art. 642).
Requisites: (SIC2)
a. He must prove that the water is Sufficient for
the intended use;
b. Indemnity must be paid;
c. Dominant owner must prove that he has the
Capacity to dispose of the water; and
d. The course is most Convenient, and least
onerous to the third person (CIVIL CODE,
Arts. 642 and 643).
Limitation:
The easement of aqueduct for private interest
cannot be imposed on buildings, courtyards,
annexes, or outhouses, or on orchards or
gardens already existing (CIVIL CODE, Art. 644).
NOTE: Notwithstanding the easement of
aqueduct, the servient owner may close or fence
his estate, or build over the aqueduct so long as
no damage is caused to the aqueduct or the
necessary repairs and cleanings of the same are
not rendered impossible (CIVIL CODE, Art. 645).
For legal purposes, easement of aqueduct is
apparent and continuous, and thus, susceptible
of acquisitive prescription (CIVIL CODE, Art.
646).
When the use, conveyance or storage of water
results in damage to another, the person
responsible for the damage shall pay
compensation (WATER CODE, Art. 47).
6. EASEMENT FOR THE
CONSTRUCTION OF A STOP LOCK
OR SLUICE GATE (CIVIL CODE, Art.
647)
One who for the purpose of irrigating or improving
his estate, has to construct a stop lock or sluice
gate in the bed of the stream from which the
water is to be taken, may demand that the owners
of the banks permit its construction, after
payment of damages, including those caused by
the new easement to such owners and to the
other irrigators (CIVIL CODE, Art. 647).
PURPOSE: To take water for irrigation or to
improve an estate
Requisites: (TIDEs)
a. Third persons should not be prejudiced;
b. Purpose must be for Irrigation or
improvement;
c. Damages must be paid; and
d. The construction must be on the Estate of
another (CIVIL CODE, Art. 647).
7. EASEMENT OF RIGHT OF WAY
Modes of Acquisition:
a. By a voluntary title (voluntary easement)
– it is constituted by covenant and does not
require that the dominant estate be isolated
and without an adequate outlet to a public
highway (CIVIL CODE, Arts. 688-693); and
b. By a compulsory title (compulsory
easement)
– if an estate is so isolated and without an
adequate outlet to a public highway, the grant
thereof is legally demandable (CIVIL CODE,
Arts. 649-657; RABUYA, Property, supra at
642).
Who may Demand Compulsory Right of
Way: (OUR)
i. Owner of the dominant estate
ii. Persons with Real right to use the
dominant estate; and
iii. Usufructuary (Id. at 550).
NOTE: A mere lessee is not entitled to
demand a right of way; his action is against
the lessor (Id.).
Requisites of Compulsory Right of Way:
(CD-RIPE)
i. Claimant must be the owner of the
enclosed immovable or one with real
right;
ii. The Dominant estate is surrounded by
other immovables and there must be no
adequate outlet to a public highway;
iii. Right of way must be absolutely
necessary;
iv. Isolation must not be due to the
claimant’s own act;
v. Payment of proper indemnity; and
1.) If passage is continuous and
permanent:
Indemnity = value of land occupied +
amount of damages caused to the
servient estate; and
2.) If passage is temporary:
Indemnity = payment of damage
caused (DE LEON, Property, supra
at 512-522).
vi. Easement must be established at the
point least prejudicial to the servient
estate; and insofar as consistent with
 this rule, where the distance from the
dominant estate to the public highway
may be the shortest (DE LEON,
Property, supra at 512-522).
The following are the requisites in order that the
dominant estate may validly claim a compulsory
permanent right of way under Articles 649 and
650 of the Civil Code (1) the dominant estate is
surrounded by other immovables; (2) it is without
adequate outlet to a public highway; (3) after the
proper indemnity has been paid; (4) the isolation
was not due to the proprietor of the dominant
estate's own acts; (5) the right of way claimed is
at a point least prejudicial to the servient estate;
and (6) the right of way must be absolutely
necessary for the normal enjoyment of the
dominant estate by its owner (AMA Land Inc. vs.
Wack Wack Residents’ Association Inc., G.R.
No. 202342, July 19, 2017).
GENERAL RULE: The least prejudice criterion
and the shortest distance criterion must concur
(Calimoso v. Roullo, G.R. No. 198594, January
25, 2016).
EXCEPTION: If the two criteria do not concur, the
criterion of least prejudice to the servient estate
must prevail over the criterion of shortest
distance (Calimoso v. Roullo, G.R. No. 198594,
January 25, 2016).
NOTE: The easement of right of way cannot be
acquired by prescription, because it is
discontinuous or intermittent (Ronquillo v. Roco,
G.R. No. L-10619, February 28, 1958). On the
other hand, an easement of light and view can be
acquired through prescription counting from the
time when the owner of the dominant estate
formally prohibits the adjoining lot owner from
blocking the view of a window located within the
dominant estate (Alolino v. Flores, G.R. No.
198774, April 04, 2016).
Burden of Proof
The burden of proving the existence of the
prerequisites to validly claim a compulsory right
of way lies in the owner of the dominant estate
(Costabella Corp. v. CA, G.R. No. 80511,
January 25, 1991).
Adequacy Test
The true standard for the grant of the legal right
of easement of right of way is adequacy. If there
is already an existing outlet from the dominant
estate to a public highway, even if inconvenient,
the need to open another is unjustified (Dichoso
v. Marcos, G.R. No. 180282, April 11, 2011).
Where the Buyer’s Land is Enclosed
Whenever a piece of land acquired by sale,
exchange, or partition is surrounded by other
estates of the vendor, exchanger, or co-owner,
he shall be obliged to grant a right of way without
indemnity (CIVIL CODE, Art. 652).
NOTE: In case of simple donation, the donor
shall be indemnified by the donee for the
establishment of the right of way (CIVIL CODE,
Art. 652).
Where the Seller’s Land is Enclosed
If it is the land of the grantor (seller, barterer or
co-owner) that becomes isolated, he may
demand a right of way after paying an indemnity.
However, the donor shall not be liable for
indemnity (CIVIL CODE, Art. 653).
Rules if Grantor’s or Grantee’s Land is
Enclosed (CIVIL CODE, Arts. 652 and 653)
a. If the enclosing estate is that of the grantor
(seller, barterer, or co-owner but not donor),
the grantee does not pay indemnity for the
easement.
b. If the enclosed estate is that of the grantor,
the grantor must pay indemnity (2 PARAS,
supra at 711).
Width of the Easement
The width of the easement of right of way shall
be that which is sufficient for the needs of the
dominant estate, and may accordingly be
changed from time to time (CIVIL CODE, Art.
651).
It may be modified from time to time depending
upon the reasonable needs of the dominant
estate (2 PARAS, supra at 710).
The right of way for cattle should not be more
than 10 meters wide unless a greater width was
a vested right under laws prior to the Civil Code
of 1889 (CIVIL CODE, Art. 657).
Q: Tomas Encarnacion's 3,000 square meter
parcel of land, where he has a plant nursery, is
located just behind Aniceta Magsino's two-
hectare parcel land. To enable Tomas to have
access to the highway, Aniceta agreed to grant
him a road right of way a meter wide through
which he could pass. Through the years Tomas'
business flourished which enabled him to buy
another portion which enlarged the area of his
plant nursery. But he was still landlocked. He
could not bring in and out of his plant nursery a
jeep or delivery panel much less a truck that he
needed to transport his seedlings. He now asked
Aniceta to grant him a wider portion of her
property, the price of which he was willing to pay,
to enable him to construct a road to have access
to his plant nursery. Aniceta refused claiming that
she had already allowed him a previous road
right of way. Is Tomas entitled to the easement
he now demands from Aniceta? (BAR 1993)
ANS: Yes. Art. 651 of the Civil Code provides that
the width of the easement must be sufficient to
meet the needs of the dominant estate, and may
accordingly change from time to time. It is the
need of the dominant estate which determines
the width of the passage. These needs may vary
from time to time. As Tomas' business grows, the
need for use of modern conveyances requires
widening of the easement. The facts show that
the need for a wider right of way arose from the
increased production owing to the acquisition by
Tomas of an additional area. Under Art. 626 of
the Civil Code, the easement can be used only
for the immovable originally contemplated.
Hence, the increase in width is justified and
should have been granted.
The facts in this case is the same as that of the
case of Encarnacion v. CA (G.R. No. 77628,
March 11, 1991) where the Court held that: “To
force Tomas to leave his jeepney in the highway,
exposed to the elements and the risk of theft
simply because it could not pass through the
improvised pathway, is sheer pigheadedness on
the part of the servient estate. Tomas should not
be denied a passageway wide enough to
accommodate his jeepney since that is
reasonable and necessary aspect of the plant
nursery business.”
Rules if the Right of Way is Permanent
As for the servient estate: The path belongs to
the servient estate, and he pays all the taxes.
As for the dominant estate: It should pay for the
repairs and should pay proportionate share of
taxes to the servient estate (CIVIL CODE, Art.
654; 2 PARAS, supra at 712).
NOTE: The word “proportionate” means the
whole tax for the whole estate.
Temporary Easement of Right of Way
Requisites: (In-C2R-In)
a. The easement must be Indispensable:
i. For the Construction, repair,
improvement, alteration, or beautification
of a building;
ii. To Carry materials through the estate of
another; or
iii. To Raise thereon scaffolding or other
objects necessary for the work (CIVIL
CODE, Art. 656).
NOTE: “Indispensable” is not to be construed
literally. Causing great inconvenience is
sufficient (DE LEON, Property supra at 530).
b. Payment of proper Indemnity to owner of the
estate for damaged caused (CIVIL CODE,
Art. 656).
NOTE: The word “owner” comprehends the
usufructuary who may make use of the right
granted (4 MANRESA 753 as cited in DE
LEON, supra at 520).
8. EASEMENT OF RIGHT OF WAY FOR
THE PASSAGE OF LIVESTOCK OR
SERVIDUMBRES PECUARIAS
Easements of the right of way for the passage of
livestock known as animal path, animal trail, or
any other, and those for watering places, resting
places, and animal folds shall be governed by the
ordinances and regulations relating thereto, and
in their absence, by the usages and customs of
the place (CIVIL CODE, Art. 657).
Maximum Width:
a. Animal path - 75 meters
b. Animal trail - 37 meters and 50 centimeters
c. Cattle - 10 meters (unless prior to the Old
Civil Code, vested rights had been acquired
to a greater width) (2 PARAS, supra at 714).
NOTE: If the easement established is
compulsory, the width shall not exceed 10 meters
(DE LEON, Property, supra at 531).
9. EASEMENT OF PARTY WALL OR
SERVIDUMBRE DE MEDIANERA
(CIVIL CODE, Arts. 658–666)
This refers to all those mass of rights and
obligations emanating from the existence and
common enjoyment of wall, fence, enclosure, or
hedges by the owners of adjacent buildings and
estates separated by such objects (2 CASTAN,
supra at 532).
Party Wall
Common wall which separates 2 estates built by
a common agreement at the dividing line such
that it occupies a portion of both estates on equal
parts (DE LEON, Property, supra at 712).
NOTE: Although called a legal easement, it is a
compulsory kind of co-ownership or forged
indivision where the shares of each owner cannot
be separated physically without destroying the
wall. Thus, each co-owner owns the half nearest
to him (2 PARAS, supra at 715).
 PARTY WALL AND CO–OWNERSHIP b. In dividing walls of gardens and yards
DISTINGUISHED situated in cities, towns, or in rural
communities;
PARTY WALL CO–OWNERSHIP

As to Physical Division of Shares

Shares of parties Shares of the co–owners

cannot be physically can be divided and
segregated but they separated physically but
can be physically before such division, a
identified. co–owner cannot point to
any definite portion of the
property as belonging to
him.
c. In fences, walls and live hedges dividing rural
As to Limitation on the Use of the Wall lands;

No limitation as to use None of the co–owners

of the party wall for may use the community
exclusive benefit of a property for his exclusive
party. benefit.

As to the Right to Exercise Renunciation

Owner may free Partial renunciation is

himself from allowed.
contributing to the cost
of repairs and
construction of a party
wall by renouncing all
his rights thereto.
(DE LEON, Property, supra at 536).
d. In ditches or drains opened between two
NOTE: Not all common walls are party walls. estates
Thus, a wall built on a lot co-owned by two
persons is a common wall but not a party wall
(Id.).

Presumptions of Existence (Juris Tantum)

(CIVIL CODE, Arts. 659 and 661):
The existence of an easement of party wall is
presumed, unless there is a title, or exterior sign,
or proof to the contrary:

a. In dividing walls of adjoining buildings, up to

point of common elevation;

NOTE: If the earth or dirt removed to open the

ditch or to clean it is only on one side, the
ownership of the ditch belongs exclusively to the
owner of the land having this exterior sign in its
favor (CIVIL CODE, Art. 661).

Rebuttal of Presumption:
a. By title;
b. By proof to the contrary (Valenzuela v.
Unson, G.R. No. L-10266, Oct. 20, 1915); or
c. By exterior signs to the contrary (CIVIL
CODE, Arts. 660 and 661).
NOTE: If one owner has signs in his favor, and
some against him, they generally cancel each
other, unless it can be shown from the purpose of
the wall that it had been made for the exclusive
benefit of one (PARAS, Property, supra at 710-
711).

Exterior Signs Rebutting the Existence of a

Party Wall (CIVIL CODE, Art. 660)
It is understood that there is an exterior sign,
contrary to the easement of party wall:

a. Whenever in the dividing wall of buildings
there is a window or opening;
B(in his favor)
d. Whenever the dividing wall bears the burden
of the binding beams, floors and roof frame
of one of the buildings, but not those of the
others;

b. Whenever the dividing wall is, on one side,

straight and plumb on all its facement, and on e. Whenever the dividing wall between
the other, it has similar conditions on the courtyards, gardens, and tenements is
upper part, but the lower part slants or constructed in such a way that the coping
projects outward; sheds the water upon only one of the estates;

(in his favor)

(in his
favor)

c. Whenever the entire wall is built within the

boundaries of one of the estates; f. Whenever the dividing wall, being built of
masonry, has stepping stones, which at
(in his certain intervals project from the surface on
favor) one side only, but not on the other;
g. Whenever lands enclosed by fences or live
hedges adjoin others that are not enclosed;
and
h. Whenever the earth or dirt removed to open
the ditch or to clean it is only on one side
thereof. The ownership of the ditch shall
belong to the owner of the land having this
exterior sign in his favor (CIVIL CODE, Art.
661).
The deposit of earth or dirt is on one side
alone is an exterior sign that the owner of that
side is the owner of the ditch or drain (DE
LEON, Property, supra at 537).
(in his favor)
NOTE: In all these cases, the ownership of the
walls, fences, or hedges shall be deemed to
belong exclusively to the owner of the property or
tenement which has in its favor the presumption
based on any one of these signs (CIVIL CODE,
Art. 660).
Rights of Part Owners: (UID)
a. To make Use of the wall in proportion to their
respective interests (CIVIL CODE, Art. 666),
rest buildings on it, or insert beams up to
one–half of the wall’s thickness;
b. To Increase the height of the wall (CIVIL
CODE, Art. 664). He must (DPaBe-Pay-
ReAdd):
i. Do so at his expense;
ii. Pay for any damage which may be
caused by the work, even though such
damage may be temporary;
iii. Bear the costs of maintenance of the
portion added;
iv. Pay for the increased cost of
preservation;
v. Reconstruct if original wall cannot bear
the increased height; and
vi. Give Additional space necessary, if the
wall is to be thickened (2 PARAS, supra
at 720).
c. To Demolish the building being supported by
a party wall provided the cost of all repairs
and work necessary to prevent any damage
which the demolition may cause to the party
wall shall be borne by him (CIVIL CODE, Art.
663).
NOTE: He may also renounce his part
ownership of the wall (CIVIL CODE, Art.
663).
Obligations of Each Part–Owner:
a. To contribute proportionately to the repair
and maintenance unless he renounces his
part–ownership (CIVIL CODE, Art. 662);
b. If one part-owner raises the height of the wall,
he must (MECA):
i. Bear the cost of Maintenance of the
additions;
ii. Bear the increased Expenses of
preservation;
iii. Bear the Cost of construction; and
iv. Give Additional land, if necessary, to
thicken the wall (CIVIL CODE, Art. 664).
NOTE: The other owners who have not
contributed in giving the height, depth, or
thickness to the wall may, nevertheless, acquire
the right of part-ownership therein, by paying
proportionally the value of the work at the time of
the acquisition and of the land used for its
increased thickness (CIVIL CODE, Art. 665).
10. EASEMENT OF LIGHT AND VIEW
(CIVIL CODE, Arts. 667–673)
Easement of Light (jus luminum)
The right to admit light from the neighboring
estate by virtue of the opening of a window or the
making of certain openings (2 CASTAN, supra at
536).
Easement of View (jus prospectus)
The right to make openings or windows, to enjoy
the view through the estate of another and the
power to which would obstruct such view or make
the same difficult. It necessarily includes
easement of light (Id.).
No part-owner, without the consent of the others,
open through the party wall any window or
aperture of any kind (CIVIL CODE, Art. 667).
Effect: If the opening is done without consent,
the other co-owners may demand that what has
been done be undone solely at the part-owner’s
expense (RABUYA, Property, supra at 558).
10-Year Period of Prescription for Acquisition
of Easement of Light and View (CIVIL CODE,
Art. 668):
The period of prescription for the acquisition of an
easement of light and view shall be counted:
a. Where the easement is positive (if made
through a party wall), from the time of the
opening of the window; or
b. Where the easement is negative (if made
through a wall on the dominant estate), from
the time of the formal prohibition upon the
adjoining owner (CIVIL CODE, Art. 668).
Rules for Regular Windows (CIVIL CODE, Art.
670):
a. For windows having DIRECT VIEWS (face to
face), observe at least 2 meters distance
between the wall having the windows and the
boundary line.
b. For windows having side or oblique views
observe a distance of at least 60 cm.
between the boundary line and the nearest
edge of the window.
NOTE: Oblique view means that from direct
view, one must turn his head to the right or to
the left to view the adjoining land.
NOTE: The non-observance of these
distances does not give rise to prescription
(CIVIL CODE, Art. 670, Par. 3).
Where the Above Distances are NOT
Applicable:
a. To buildings separated by a public way or
alley, which is not less than 3 meters wide
(CIVIL CODE, Art. 672);
EXCEPTION: Unless a special regulation
and local ordinance provide the contrary
(CIVIL CODE, Art. 672).
b. Whenever by any title (such as by contract,
will, donation, or prescription) a right has
been acquired to have direct views,
balconies, or belvederes overlooking an
adjoining property. The servient estate
cannot build thereon if the direct view is less
than a distance of 3 meters from the wall
(CIVIL CODE, Art. 673); and
Balcony – a platform that projects from the
wall of a building and is enclosed by a
parapet or railing.
Belvedere – a structure (such as a cupola or
a summerhouse) designed to command a
view.
NOTE: Art. 673 speaks of a true servitude
(servitude of restraint or abstention) unlike
Arts. 669 and 670 which do not really refer to
easements since both owners are prohibited
(2 PARAS, supra at 728).
c. Restricted Windows, when the above
distances are not observed (CIVIL CODE,
Art. 669).
11. DRAINAGE OF BUILDINGS (CIVIL
When the foregoing distances are not
observed, only restricted windows may be
made by the owner of a wall which is not a
party wall, subject to the following
requirements: (WISH-Pu)
i. There must be a Wire screen;
ii. There must be an Iron grating imbedded
in the wall;
iii. Maximum Size is 30 cm. square;
iv. The opening must be at the Height of the
ceiling joists (beams) or immediately
under the ceiling (techo); and
v. The window must be for the Purpose of
admitting light and air only, but not of
view.
Ceiling joists
Commonly called beams laid horizontally
intended to serve as connection and main
support of the timbers of different floors that
separate the stories of a building.
There may be several openings provided, the
restrictions are complied with for every opening.
There can also be several openings in every floor
or story, for each floor or story has a ceiling
(Choco v. Santamaria, G.R. No. 6076, December
29, 1911).
Remedies of the abutting owner in case of
restricted windows (CB):
a. Close the openings if the wall becomes a
party wall; or
b. Block the light by building or erecting his own
wall unless a servitude is acquired by title or
prescription (CIVIL CODE, Art. 669).
NOTE: He may also ask for the reduction of the
opening to the proper size.
CODE, Arts. 674-676)
The owner of a building shall be obliged to
construct its roof or covering in such manner that
the rain water shall fall on his own land or on a
street or public place, and not on the land of his
neighbor (CIVIL CODE, Art. 674).
The owner of a tenement or a piece of land,
subject to the easement of receiving water falling
from roofs, may build in such manner as to
receive the water upon his own roof or give it
another outlet in accordance with local
ordinances or customs, and in such a way as not
to cause any nuisance or damage whatever to
the dominant estate (CIVIL CODE, Art. 675).
Whenever the yard or court of a house is
surrounded by other houses, and it is not
possible to give an outlet through the house itself
to the rain water collected thereon, the
establishment of an easement of drainage can be
demanded (CIVIL CODE, Art. 676).
a. Easement of drainage of buildings – the
right to divert or empty the rain waters from
one’s own roof or shed to the neighbor’s
estate either drop by drop or through
conduits (2 CASTAN, supra at 539).
Art. 674 does not really create an easement
for it merely regulates the use of a person’s
property insofar as rain water is concerned (4
MANRESA 810 as cited in PARAS, supra at
730).
NOTE: Art. 674 provides an exception to Art.
637 which obliges lower estates to receive
water naturally flowing from higher estates
(DE LEON, Property, supra at 551).
b. Easement to receive falling rain waters –
deals not with legal easement but with a
voluntary easement to receive rain water
falling from the roof of an adjoining building
(Id. at 552).
c. Easement giving outlet to rain water
where house surrounded by other
houses.
NOTE: This is similar to the legal easement
of right of way (2 PARAS, supra at 731).
 Requisites (DINE):
a. Least possible Damage caused;
b. There must be payment of proper
Indemnity (Id.);
c. There must be No adequate outlet to the
rain water because the yard or court of a
house is surrounded by other houses
(enclosure) (CIVIL CODE, Art. 676); and,
d. The outlet to the water must be at the
point where Egress is easiest and
establishing a conduit for drainage
(CIVIL CODE, Art. 676; 2 PARAS, supra
at 731-732).
Ownership of Rain Waters
Rain waters falling on private lands shall
belong to the State. However, any person
who collects water by means of cisterns,
tanks, or pools shall have exclusive control
over the same and shall have the right to
dispose it only for domestic purposes
(WATER CODE, Arts. 6-7; RABUYA,
Property, supra at 661).
12. INTERMEDIATE DISTANCES AND
WORKS FOR CERTAIN
CONSTRUCTIONS AND PLANTINGS
(CIVIL CODE, Arts. 677–681)
No constructions can be built or plantings made
near fortified places or fortresses without
compliance with the conditions required in
special laws, ordinances, and regulations relating
thereto (CIVIL CODE, Art. 677).
NOTE: Art. 677, in effect establishes an
easement in favor of the State (DE LEON,
Property, supra at 549). The prohibitions
prescribed by law cannot be altered or renounced
by stipulation of the parties (CIVIL CODE, Art.
678).
REASON: National security and safety
specifically to prevent intrusion into neighboring
estates (2 PARAS, supra at 732).
a. Constructions (examples: wells, sewers,
etc.)
Rules (OC-P2V):
i. Follow distances fixed by Ordinances
and Customs;
ii. Protective structures prescribed by
ordinances or custom must be erected;
iii. If none, Precautions must be taken to
avoid damage to neighboring estates;
and
iv. Violation causes responsibility for
damages caused (DE LEON, Property,
supra at 550).
b. Plantings
Rules (OC-2-50):
i. Follow distances as prescribed by
Ordinances;
ii. In the absence of ordinances, Customs
must be observed;
iii. If none the following rule shall be
observed:
1.) For large trees: at least 2m from
boundary; and
2.) For shrubs: at least 50cm from the
center of the tree (2 PARAS, supra
at 733).
Remedy for Violation
Every landowner shall have the right to
demand that the plant be uprooted (CIVIL
CODE, Art. 679).
The provision covers:
i. Planted in violation of the rule; and
ii. Tree grows spontaneously at shorter
distance than mentioned (CIVIL CODE,
Art. 679).
NOTE: In case of disagreement, the court
shall determine when trees are to be
classified as “tall” or “small” (DE LEON,
Property, supra at 551).
c. Intrusions:
Rules:
i. Of branches: the owner of the tree may
be compelled to cut intruding branches at
the boundary.
NOTE: If the demand is not acted, the
owner of invaded tenement must seek
authority from the court before cutting
(CIVIL CODE, Art. 680).
ii. Of roots: the owner of the invaded
tenement may cut them himself at the
boundary (2 CASTAN 285, as cited in 2
PARAS, supra at 734).
Reason: By incorporation, the intruding
roots belong to the owner of the land
where they are found (2 CASTAN, supra
at 596-597).
NOTE: The right of the abutting owner
does not prescribe, unless he was
prohibited to cut, in such case, the 10-
year prescriptive period will run (CIVIL
CODE, Art. 621).
iii. Fruits falling naturally belong to the
owner of the land (CIVIL CODE, Art.
681).
 REASON: To compensate for
inconvenience caused (DE LEON,
Property, supra at 551).
NOTE: If a fruit fell on a public property,
then the owner of the tree retains
ownership (Id. at 552).
13. EASEMENT AGAINST NUISANCE
(CIVIL CODE, Arts. 682-683)
Every building or piece of land is subject to the
easement which prohibits the proprietor or
possessor from committing nuisance through
noise, jarring, offensive odor, smoke, heat, dust,
water, glare, and other causes (CIVIL CODE, Art.
682).
Subject to zoning, health, police, and other laws
and regulations, factories and shops may be
maintained provided the least possible
annoyance is caused to the neighborhood (CIVIL
CODE, Art. 683).
The servient owner in an easement against
nuisance is the proprietor or possessor of the
building or piece of land, who commits the
nuisance thru noise, jarring, offensive odor, etc.
(2 PARAS, supra at 736-737).
The general public, or anybody injured by the
nuisance is the dominant owner in an easement
against nuisance (Id.).
14. LATERAL AND SUBJACENT
SUPPORT (CIVIL CODE, Arts. 684-687)
No proprietor shall make such excavations upon
his land as to deprive any adjacent land or
building of sufficient lateral or subjacent support
(CIVIL CODE, Art. 684).
Lateral support
When the supported and supporting lands are
divided by a vertical plane; on the same plane
(DE LEON, Property, supra at 553).
Subjacent support
When the supported land is above and the
supporting land is beneath (Id.).
NOTE: There exists a doubt as to whether
easements against nuisance and lateral and
subjacent support may be categorized as legal
easements (REYES-PUNO, Philippine Civil Law,
supra at 188-189). While they are restrictions on
ownership, still even without a prohibition by the
dominant estate, the elimination of such support
would be unlawful (2 PARAS, supra at 739).
The duty of an adjacent owner making
excavations upon his land not to deprive any
adjacent land of sufficient lateral or subjacent
support is an absolute one. It does not depend
upon the degree of care and precaution made by
the proprietor in making the excavation or
building in his land (De Jesus v. Howmart Corp.,
G.R. No. 44191-R, August 28, 1974).
Any stipulation or testamentary provision
allowing such kind of excavation is void (CIVIL
CODE, Art. 685).
Remedy: Injunctive relief and damages (DE
LEON, Property, supra at 558).
Between two adjacent landowners, each has an
absolute property right to have his land laterally
supported by the soil of his neighbor, and if either,
in excavating on his own premises, he so disturbs
the lateral support of his neighbor’s land as to
cause it, or, in its natural state, by the pressure of
its own weight, to fall away or slide from its
position, the one so excavating is liable (Castro
v. Monsod, G.R. No. 183719, February 02,
2011).
EXTINGUISHMENT OF LEGAL
EASEMENTS
Special Rules on the Extinguishment of the
Easement of Right of Way
Special causes of extinction (CIVIL CODE, Art.
655)
If the right of way granted to a surrounded estate
ceases to be necessary because its owner has joined
it to another abutting on a public road, the owner of
the servient estate may demand that the easement
be extinguished (CIVIL CODE, Art. 655, Par. 1).
The owner of the servient estate may likewise
demand that the easement be extinguished in case a
new road is opened giving access to the isolated
estate (CIVIL CODE, Art. 655, Par. 2).
The owner of the servient estate may demand the
extinguishment in the following instances:
1. The opening of a public road; or
2. Joining the dominant tenement to another with
exit on a public road (2 PARAS, supra at 713).
NOTE: The opening extinguishes only compulsory
easements, not voluntary easements that are
extinguished only by mutual agreement or
renunciation by the dominant owner (Unisource Corp.
v. Chung, G.R. No. 173252, July 17, 2009).
In either case, the owner of the servient estate must
return what he may have received by way of
indemnity (CIVIL CODE, Art. 655, Par. 1) and the
public highway must substantially meet the needs of
the dominant estate in order that the easement may
be extinguished (CIVIL CODE, Art. 655, Par. 3).
REQUISITES FOR THE
EXTINGUISHMENT OF THE EASEMENT
OF A RIGHT OF WAY: (PAD)
1. The owner of the surrounded estate joined it to
another abutting on a Public road (CIVIL CODE,
Art. 655, Par. 2) or a new road is opened giving
access to the isolated estate (CIVIL CODE, Art.
655, Par. 2);
2. The new outlet is Adequate in either case (CIVIL
CODE, Art. 655, Par. 3); and
3. The servient owner must Demand for release of
his estate coupled with return of indemnity
received without interest (DE LEON, Property,
supra at 529).
NOTE: The interest on the indemnity shall be
deemed to be in payment of rent for the use of
the easement (CIVIL CODE, Art. 655, Par. 1).
NOTE: The extinction is not automatic. There
must be a demand for extinction coupled with
tender of indemnity by the servient owner (DE
LEON, Property, supra at 529; 2 PARAS, supra
at 713).
In case of temporary or discontinuous easement,
nothing has to be paid (DE LEON, Property,
supra at 529).
The easement of right of way is discontinuous
because it is exercised only if a person passes or
sets foot on somebody else’s land. The presence
of more or less permanent railroad tracks does
not change this. It is not the presence of apparent
signs or physical indications showing the
existence of an easement, but rather the manner
of exercise thereof, that categorizes such into
continuous or discontinuous (Bogo-Medellin
Milling Co., Inc. v. CA, G.R. No. 124699, July 31,
2003).
Like a road for the passage of vehicles or
persons, an easement of right of way of railroad
tracks is discontinuous because the right is
exercised only if and when a train operated by a
person passes over another's property. In other
words, the very exercise of the servitude
depends upon the act or intervention of man
which is the very essence of discontinuous
easements (Bicol Agro Industrial Producers
Cooperative v. Obias, G.R. No. 172077, October
09, 2009).
If the owner of the servient estate demands that
the easement be extinguished, he should return
what he may have received by way of indemnity;
the amount to be returned must consist of the
value of the land occupied and the damages
caused to the servient estate (DE LEON,
Property, supra at 530).
VOLUNTARY
EASEMENTS
(ARTS. 688-693)
VOLUNTARY EASEMENTS (CIVIL CODE,
ARTS. 688-693)
These are easements constituted by will of the parties
or of a testator.
Every owner of a tenement or piece of land may
establish thereon the easements which he may deem
suitable, and in the manner and form for which he
may deem best, provided he does not contravene the
laws, public policy, or public order (CIVIL CODE, Art.
688).
REMEDY FOR IMPAIRMENT
Ask for the destruction of such works and the
restoration of the things to their condition before the
impairment was committed, with indemnity for
damages suffered (3 SANCHEZ ROMAN, supra at
609).
The owner possessing capacity to encumber
property may constitute a voluntary servitude. If there
are various owners, all must consent; but consent
once given is not revocable (Id.).
RULES GOVERNING VOLUNTARY
EASEMENTS:
1. If created by title, such as contract or will, then by
such title;
2. If created by prescription, by the form and
manner of possession of the easement; or
3. In default of any of the above, by the provisions
of the Civil Code on easements (2 PARAS, supra
at 741).
WHEN THERE IS A USUFRUCT:
1. The owner of a tenement or piece of land may
impose thereon, without the consent of the
usufructuary, any servitudes which will not
injure the right of usufruct (CIVIL CODE, Art.
689).
2. When a usufruct exists, the beneficial owner may
by himself create a temporary easement
compatible with the extent of his beneficial
dominion (4 MANRESA 838 as cited in 2 PARAS,
supra at 737).
NOTE: If the easement is perpetual, both the
naked and beneficial owners must consent
(CIVIL CODE, Art. 690).
WHEN THERE IS CO-OWNERSHIP
In order to impose an easement on an undivided
tenement, or piece of land, the consent of all the co-
owners shall be required (CIVIL CODE, Art. 691).
REASON: The creation of the voluntary easement is
an act of ownership (2 PARAS, supra at 743-744).
NOTE: However, the consent need not be given
simultaneously; they can be given successively (4
MANRESA 838-839 as cited in PARAS at 744).
The consent given by one of the co-owners
separately from the others shall bind the grantor and
his successors (CIVIL CODE, Art. 691, Par. 3).
NOTE: Once a co-owner gives the consent, he
cannot later on revoke his consent, unless it is a
vitiated consent. In fact, his own successors cannot
ordinarily revoke the consent he had given (3
SANCHEZ ROMAN, supra at 640).
VOLUNTARY EASEMENTS ARE
ESTABLISHED IN FAVOR OF:
1. Predial servitudes:
a. For the owner of the dominant estate; or
b. For any other person having any juridical
relation with the dominant estate, if the owner
ratifies it.
2. Personal servitudes: for anyone capacitated to
accept (CIVIL CODE, Art. 613).
ABANDONMENT OF PROPERTY
If the owner of the servient estate should have bound
himself, upon the establishment of the easement, to
bear the cost of the work required for the use and
preservation thereof, he may free himself from this
obligation by renouncing his property to the owner of
the dominant estate (CIVIL CODE, Art. 693).
NOTE: The abandonment must appear in a public
document for convenience only (CIVIL CODE, Art.
1358 (1)).
NOTE: The abandoner must comply with the proper
juridical form for the transmission of the ownership of
real property. Thus, implied abandonment is not
allowed (4 MANRESA 843 as cited in PARAS at 746).
EXTINGUISHMENT OF VOLUNTARY
EASEMENTS
GROUND: Only by mutual agreement
NOTE: A voluntary easement could be extinguished
only by mutual agreement or by renunciation of the
owner of the dominant estate. The opening of an
adequate outlet to a highway can extinguish only
legal or compulsory easements, not voluntary
easements. The fact that an easement by grant may
have also qualified as an easement by necessity
does not detract from its permanency as a property
right, which survives the termination of the necessity.
(Unisource Commercial & Dev. Corp v. Chung, G.R.
No. 173252, July 17, 2009).
It is generally effective between the parties, their heirs
and assigns, except in case where the rights and
obligations under the contract are not transmissible
by their nature (CIVIL CODE, Art. 1311). When the
easement in this case was established by contract,
the parties unequivocally made provisions for its
observance by all whom in the future might succeed
them in dominion (La Vista v. CA, G.R. No. 95252,
September 5, 1997).
NUISANCE
(ARTS. 694-707)
A nuisance is any act, omission, establishment,
business, condition of property or anything else
which: (ISA-HO)
1. Injures or endangers the health or safety of
others;
2. Annoys or offends the senses;
 NOTE: The determining factor is not its intensity CLASSES OF NUISANCE:
or volume. It is that the noise is of such character
As to the object it affects:
as to produce actual physical discomfort and
1. Public
annoyance to a person of ordinary sensibilities
– Affects the community or a considerable
rendering adjacent property less comfortable and
number of persons (although the extent of
valuable (2 PARAS, supra at 750).
annoyance or danger be unequal) (2 PARAS,
supra at 751);
3. Shocks, defies or disregards decency or morality;
4. Obstructs or interferes with the free passage to
Example: A noisy or dangerous factory in a
any public highway or street, or body of water; or
residential district
5. Hinders or impairs the use of property (CIVIL
CODE, Art. 694).
2. Private
– Affects only a person or a small number of
NOTE: Operates as a restriction upon the right of
persons; and
the owner of the property to make such use of it
as he pleases (DE LEON, Property, supra at
Example: An illegally constructed dam partially
564). But if the hindrance is just, authorized and
resting on another’s estate
necessary, it is not a nuisance (2 PARAS, supra
at 749).
3. Mixed
– Nuisance may be both public and private in
Nuisance is so comprehensive that it has been
character (DE LEON, Property, supra at 564-
applied to almost all ways which have interfered with
565).
the rights of the citizens, either in person, property,
the enjoyment of his property, or his comfort (Cruz v.
Pandacan Hiker’s Club, G.R. No. 188213, January
As to its susceptibility to summary
11, 2016). abatement
1. Per se (nuisance at law)
– Nuisance at all times and under all
NEGLIGENCE V. NUISANCE circumstances regardless of location and
NEGLIGENCE NUISANCE surrounding; and

As to Basis 2. Per accidens (nuisance in fact)

– Nuisance by reason of circumstances, location,
Liability is based on Liability is based on or surroundings (ALBANO, Torts and Damages
lack of proper care or resulting injury to others, (2016), p.687 [hereinafter ALBANO, Torts and
diligence. regardless of the degree Damages]).
of care or skill exercised
to avoid injury.
NUISANCE PER SE V. NUISANCE PER
As to the Condition of the Act ACCIDENS
NUISANCE PER
Act complained of is There is continuing harm NUISANCE PER SE
ACCIDENS
already done which being suffered by the
caused injury to the aggrieved party by the As to Proof
plaintiff. maintenance of the act
or thing which The thing becomes a The thing becomes a
constitutes the nuisance as a matter of nuisance as a question
nuisance. law. of fact.

As to Abatement As to Abatement

Abatement is not Abatement without May be summarily A reasonable notice to

available as a remedy. judicial proceedings is abated. the person allegedly
The action is for allowed to suppress the maintaining the same is
damages. nuisance. required.
(DE LEON, Property, supra at 562). As to Injury Caused

Injury in some form is Injury is contingent until

certain to be inflicted. it actually occurs
(Id.).
NUISANCE V. TRESPASS
In trespass, there is entry into another’s property, this
is not necessarily so in nuisance. In trespass, the
injury is direct and immediate; in nuisance, it is only
consequential (2 PARAS, supra at 748).
DOCTRINE OF ATTRACTIVE NUISANCE
One who maintains on his premises dangerous
instrumentalities of a character likely to attract
children in play and who fails to exercise ordinary
care to prevent children from playing therewith or
resorting thereto is liable to a child of tender years
who is injured thereby, even if the child is technically
a trespasser in the premises (Hidalgo Enterprises v.
Balandan, G.R. No. L-3422, June 13, 1952).
A swimming pool or water tank is not an attractive
nuisance unless there is some unusual condition or
artificial feature other than the mere water and its
location (DE LEON, Property, supra at 566).
NOTE: Every successive owner or possessor of
property who fails or refuses to abate a nuisance in
that property started by a former owner or possessor
is liable therefore in the same manner as who created
it (CIVIL CODE, Art. 696).
REASON: Injurious effect is a continuing one
(DE LEON, Property supra at. 567).
The Doctrine of Comparative Utility or Balancing
of Utilities Doctrine provides that there is only a
nuisance if the annoyance outweighs the utility to the
actor and to society as a whole (RABUYA, Property,
at 681-682).
REMEDIES AGAINST PUBLIC
NUISANCE: (PCE)
1. Prosecution under the RPC or local ordinance;
2. Civil Action; and
3. Extrajudicial Abatement (CIVIL CODE, Art. 699).
REMEDIES AGAINST PRIVATE
NUISANCE: (CE)
1. Civil Action; and
2. Extrajudicial Abatement (CIVIL CODE, Art. 705).
EXTRAJUDICIAL ABATEMENT
Any private person may abate a public nuisance
which is especially injurious to him by removing, or if
necessary, by destroying the thing which constitutes
the same, without committing a breach of peace, or
doing unnecessary injury (CIVIL CODE, Art. 704).
Requisites: (INDRAV)
1. Nuisance must be especially Injurious to the
person affected;
2. No breach of peace or unnecessary injury must
be committed;
3. Prior Demand;
4. Prior demand has been Rejected;
5. Approval by district health officer and assistance
of local police; and
6. Value of destruction does not exceed P3,000
(CIVIL CODE, Art. 704).
The action to abate a public/private nuisance is not
extinguished by prescription except in easements
which are extinguished by obstruction and non-user
for 10 years (2 PARAS, supra at 748). Since the right
was extinguished by prescription, it ceased to be a
nuisance anymore (Ongsiaco v. Ongsiaco, G.R. No.
L-7510, March 30, 1957).
Unless a Nuisance is a Nuisance Per se, it May
Not be Summarily Abated
A nuisance per accidens (or that which depends upon
certain conditions and circumstances), its existence
being a question of fact, cannot be abated without
due hearing thereon in a tribunal authorized to decide
whether such a thing does in law constitute a
nuisance (Rana v. Lee Wong, G.R. No. 192861-62,
June 30, 2014).
Generally, LGUs have no power to declare a
particular thing as a nuisance unless such a thing is
a nuisance per se (Aquino v. Municipality of Malay
Aklan, G.R. No. 211356, September 29, 2014).
However, mayors are empowered to order the
closure and removal of illegally constructed
establishments for failing to secure the necessary
building permits, whether the building constituted a
nuisance per se or nuisance per accidens (Aquino v.
Municipality of Malay Aklan, G.R. No. 211356,
September 29, 2014).
DEFENSES IN ACTIONS FOR DAMAGES
BASED ON NUISANCE (PE):
1. Public necessity; and
2. Estoppel (ALBANO, Torts and Damages, supra
at 398).
ROLES OF OFFICERS WITH RESPECT
TO PUBLIC NUISANCE
1. District health officer is charged with the duty to
see to it that one or all of the remedies against a
public nuisance are availed of (CIVIL CODE,
Arts. 700-702). His power is simply to determine
whether or not the abatement, without judicial
proceedings, is the best remedy (DE LEON,
Property, supra at 575); and
2. The action must be commenced by the city or
municipal mayor (Id. at 570-571).
 NOTE: A private person may also file an action if
the public nuisance is especially injurious to him DIFFERENT MODES OF
(CIVIL CODE, Art. 703).
ACQUIRING
NOTE: Under the Revised Charter of Manila, the
proper official insofar as illegal construction of
OWNERSHIP
houses or public streets are concerned, is the (ART. 712)
City Engineer (Sitchon v. Aquino, G.R. No. L-
8191, February 27, 1956).

MODE
This is the proximate cause of the acquisition; the
REGISTRY OF actual process of acquisition or transfer of ownership
PROPERTY over a thing in question (3 SANCHEZ ROMAN, supra
at 199-200).
(ARTS. 708-711)
TITLE
This is the remote cause of the acquisition; the
juridical justification for the acquisition or a transfer of
REGISTRATION ownership or other real right. (Acap v. CA, G.R. No.
It is any entry made in a book or public registry of 118114, December 7, 1995).
deeds (DE LEON, Property, supra at 578).
MODE V. TITLE
SYSTEMS OF REGISTRATION: MODE TITLE
1. Former registration systems:
a. Spanish Mortgage Law of 1893; As to Existence of Real Right
b. Torrens System established by the Land
Registration Act (Act. No. 496); and Directly and Serves merely to give
c. Sec. 194 - Revised Administrative Code; immediately produces a the occasion for its
real right. acquisition or existence.
2. Present registration system - Property
Registration Decree (P.D. No. 1529).
As to Cause
EFFECTS OF REGISTRATION: The cause or the The means or the
1. Operates as constructive notice; proximate cause. remote cause.
2. Does not validate or cure defective instrument;
3. Cannot bind property where it is legally As to Essence of the Right
ineffective;
4. Does not vest title; and Essence of the right Means whereby that
5. Rule of first in time, first in right (DE LEON, which is to be created essence is transmitted.
Property, supra at 579-581). or transmitted.

PURPOSES OF REGISTRATION: (DE LEON, Property supra at 579).

1. Gives true notice of the true status of the real
property and the real rights thereto; DIFFERENT MODES AND TITLES
2. Prejudices third persons; and OF ACQUIRING OWNERSHIP
3. Prevents commission of frauds, thus, insuring the
effectivity of real rights over real property (2 MODES OF TITLES OF
PARAS, supra at 761-762). ACQUIRING ACQUIRING
OWNERSHIP OWNERSHIP

Original Modes

Occupation Condition of being

without known owner

Work which includes Creation, discovery, or

Intellectual creation invention
 NOTE: The critical factor in the different modes
MODES OF TITLES OF
of effecting delivery which gives legal effect to the
ACQUIRING ACQUIRING
act, is the actual intention of the vendor to deliver,
OWNERSHIP OWNERSHIP
and its acceptance by the vendee. Without that
Derivative Modes intention, there is no tradition (Union Motor v. CA,
G.R. No. 117187, July 20, 2001).
Law Existence of required
conditions KINDS: (RCQM)
1. Real Tradition
Examples: CIVIL – Actual delivery;
CODE, Art. 624; Art.
681; Art. 1434
2. Constructive Tradition
Tradition Contract of the parties – Delivery of the thing, not real or material, but
consists merely in certain facts indicative of the
Donation Contract of the parties same
a. Traditio Symbolica – parties make use of a
Prescription Possession in the token or symbol to represent the thing
concept of owner delivered;
b. Traditio Longa Manu – by mere consent of
Succession Death the parties if the thing sold cannot be
(DE LEON, Property supra at 580). transferred to the possession of the vendee
at the time of the sale;
LAW c. Traditio Brevi Manu – when the vendee
already has possession of the thing sold by
Those special legal provisions which directly vest
virtue of another title;
ownership or real rights in favor of certain persons, d. Traditio Constitutum Possessorium –
independently of the other modes of acquiring and when the vendor continues in possession of
transmitting ownership or other real rights. the thing sold not as owner but in some other
capacity; and
Examples: e. Tradition by public instrument – the
1. Fruits naturally falling upon adjacent land
execution is equivalent to the delivery of the
belong to the owner of said land; and thing, object of the contract.
2. When a person who is not the owner of a
thing sells or alienates and delivers it, and NOTE: The execution of a public instrument
later the seller or grantor acquires title gives rise only to a prima facie presumption
thereto, such title passes by operation of law of delivery which is destroyed when the
to the buyer or grantee (CIVIL CODE, Art.
instrument expresses that delivery was not
1434) intended, or by other means showing that
delivery was not effected because a third
TRADITION OR DELIVERY person was in actual possession thereof
It is a mode of acquiring ownership as a consequence (Equatorial Realty v. Mayfair Theater, G.R.
of certain contracts by virtue of which the object is No. 133879, November 21, 2001).
placed in the control and possession of the
transferee, actually or constructively. It is a derivative 3. Quasi–tradition
mode of acquiring ownership and other real rights by – Exercise of the right of the grantee with the
virtue of which, there being an intention and capacity consent of the grantor; and
on the part of the grantor and grantee and the pre-
existence of said rights in the estate of the grantor, 4. Tradicion por Ministerio de la ley
they are transmitted to the grantee through a just title – Delivery by operation of law (DE LEON,
(Id. at 593). Property, supra at 594- 595).
Requisites (ARTI):
1. Transmission should be manifested by some Act
MODES OF LOSING OWNERSHIP AND
which should be physical, symbolical or legal; OTHER REAL RIGHTS:
2. Right transmitted should have previously existed 1. Voluntary Modes
in the patrimony of the grantor; – Those that depend upon the will of the owner:
3. Transmission should be by just title; and a. Abandonment – to be valid, requires that the
4. Grantor and grantee should have Intention and holder have legal capacity and intention to
capacity to transmit and acquire (Id.). renounce the right.
 b. Alienation – transfer of right to another by
acts mortis causa or inter vivos, either
onerous or gratuitous.
2. Involuntary Modes
– Those independent of the will of the owner:
a. Destruction of the thing which may be
physical or juridical (e.g., the thing goes out
of commerce);
b. Revocatory acts (e.g., nullity, rescission,
revocation, or resolution);
c. Extinguishment by legal precept and by
virtue of the owner or third persons’ acts
(e.g., accession or acquisitive prescription);
d. Extinguishment by juridical decree (e.g.,
confirmation of judicial sale); or
e. Extinguishment by act of the State (e.g.,
confiscation of effects of crime or
expropriation) (2 CAGUIOA, supra at 351-
352).
OCCUPATION
(ARTS. 713-724)
OCCUPATION
Things appropriable by nature which are without an
owner, such as animals that are the object of hunting
and fishing, hidden treasure, and abandoned
movables, are acquired by occupation (CIVIL CODE,
Art. 713).
It is a mode of acquiring ownership by the seizure of
corporeal things that have no owner, with the
intention of acquiring them, and according to the rules
laid down by law (3 SANCHEZ ROMAN, supra at
210).
Requisites: (CARISO)
1. The thing seized must be Corporeal personal
property;
2. The thing must be susceptible of Appropriation
by nature;
3. Requisites laid down by law must be complied
with;
4. There must be an Intention to appropriate;
5. There must be Seizure of a thing; and
6. The thing must be without an Owner (DE LEON,
Property, supra at 602).
NOTE: Material holding is not essential as long
as the possessor considers the thing as
subjected to his control or disposition (Id. at 604).
Specific Instances:
1. Hunting and fishing;
2. Finding of movables which do not have an owner;
3. Finding of abandoned movables (Id. at 598);
A thing is considered abandoned when:
a. Spes recuperandi (expectation to recover) is
gone; and
b. Animo revertendi (intention to return or have
it returned) has been given up by the owner
(2 PARAS, supra at. 790).
NOTE: A thing that has been lost or taken by
force is not ipso facto converted to res nullius for
it to belong to the person who takes possession
of the same without the necessity of proving the
mode of his acquisition and it may thus be
recovered by the original owner (CIVIL CODE,
Art. 559). Such thing cannot be acquired by
prescription even if extraordinary (2 PARAS,
supra at. 790).
4. Finding of hidden treasure (CIVIL CODE, Arts.
438 and 439);
5. Catching of swarm of bees that has escaped from
its owner, under certain conditions (CIVIL CODE,
Art. 716);
6. Catching of domesticated or tamed animals that
have escaped from their owners, under certain
conditions (2 PARAS, supra at 789);
7. Transfer of pigeons to another breeding place
without fraud or artifice (CIVIL CODE, Art. 717);
and
8. Transfer of fish to another breeding place without
fraud or artifice (CIVIL CODE, Art. 717).
Land Ownership Cannot be Acquired by
Occupation (CIVIL CODE, Art 714)
The ownership of a piece of land cannot be acquired
by occupation (CIVIL CODE, Art. 714).
REASON: When the land is without owner, it pertains
to the State pursuant to Regalian Doctrine (2
PARAS, supra at. 791).
NOTE: The State need not acquire abandoned lands
by occupation because once the requisites of
abandonment had been fulfilled; reversion operates
automatically (PINEDA, Law on Property, supra at
49).
RULE ON ABANDONED PRIVATE LAND
There is no law which categorically provides that such
land becomes the property of the State. Since Art.
714 makes no distinction between land which never
had an owner and a land originally with an owner but
later abandoned, it would seem that the land cannot
be acquired by occupation. However, there are Civil
Law authorities who are of the view that such
interpretation would result in the absurd situation of
an abandoned land remaining perpetually res nullius 2. One who buys the property from the finder
and not capable of being acquired by prescription. knowing that he is buying lost property has the
Thus, it is submitted that the abandoned land duty to return although he is not the finder;
becomes patrimonial land of the State susceptible of 3. Thing cannot be acquired by prescription even if
acquisition through acquisitive prescription (2 extraordinary;
PARAS, supra at 792). 4. Law requires the finder to deliver the movable to
the mayor where the finding has taken place
OCCUPATION V. POSSESSION (CIVIL CODE, Art. 719, Par. 1);
5. Abandonment must be voluntary and intentional
OCCUPATION POSSESSION to be effective;
6. If the owners should appear in time, he is obliged
As to Concept
to give the finder a 10% reward based on the sum
Mode of acquiring Merely raises the or the price of the thing found (CIVIL CODE, Art.
ownership. presumption of 720); and
ownership when it is 7. The expenses must be reimbursed by the finder
exercised in the concept or the owner in case the latter claims the movable
of an owner. (CIVIL CODE, Art. 719, Par. 4; DE LEON,
Property, supra at 609-610).
As to Property Covered
NOTE: The rights and obligations of the finder of lost
Refers only to May be exercised over personal property are based on the principle of quasi-
corporeal personal any kind of property contract. The duty imposed on the finder by Art. 719
property. whether real or personal, is based on the fact that one who lost his property
corporeal or incorporeal. does not necessarily abandon it. If there is no
abandonment, the lost thing has not become res
As to Ownership of the Object nullius (DE LEON, Property supra at 609).
Requires that the Refer to a property
object thereof be owned by somebody.
without an owner.
DONATION
As to Intent to Acquire (ARTS. 725-773)
Requires that there be May be had in the
an intent to acquire concept of a mere
ownership. holder. DONATION
As to Existence It is an act of liberality whereby a person disposes
gratuitously of a thing or right in favor of another who
May not take place May exist without accepts it (CIVIL CODE, Art. 725).
without form of occupation.
possession. Requisites: (CIDA)
1. Donor must have Capacity to make the donation
As to Duration at the time of the perfection of the contract;

Of short duration. Generally of longer NOTE: Donation is valid even if the person has
duration. schizophrenia. A person suffering from such
sickness is presumed capable of attending to his
As to Effect
property rights. There is no total loss of control of
By itself cannot lead to May lead to another form his mental facilities (Catalan v. Basa, G.R. No.
another form of which is prescription. 159567, July 31, 2007).
acquisition.
2. He must have donative Intent (animus donandi);
(DE LEON, Property, supra at 603).
3. There must be Delivery; and
RULES AS TO LOST MOVABLES:
1. Theft is committed by any person, having found 4. Donee must Accept or consent to the donation.
lost property, shall fail to deliver the same to the
local authorities or to its owner (REVISED NOTE: In certain donations, the form prescribed
PENAL CODE, Art. 308(1)); by law must be followed (CIVIL CODE, Arts. 748
and 749; DE LEON, Property, supra at 627).

ESSENTIAL FEATURES/ELEMENTS OF
A TRUE DONATION (INTER VIVOS): (AI-
AR)
1. Alienation of property by the donor during his
lifetime, which is accepted;
2. Irrevocability (except for legal causes);
3. Animus Donandi (Intent to benefit the donee);
and
4. Resultant decrease in the assets or patrimony of
the donor (2 PARAS, supra at 881-882).
PERFECTION OF DONATION
The donation is perfected from the moment the donor
knows of the acceptance by the donee (CIVIL CODE,
Art. 734).
NOTE: Acceptance must be made during the lifetime
of the donor and of the donee (CIVIL CODE, Art. 746)
1. In case of donation inter vivos, acceptance takes
effect during the lifetime of the donor and the
donee.
2. In case of donation mortis causa, acceptance is
made only after the donor’s death because
they partake of the nature of a will and thus
governed by the rules on succession (CIVIL
CODE, Art. 728).
Acceptance is indispensable because nobody is
obliged to receive a benefit against his will. Its
absence makes the donation null and void (DE
LEON, Property, supra at 653).
Prior to learning of the acceptance, there is as yet no
perfected donation, in which case the donor may give
the property to somebody else. Once a valid donation
is perfected, it cannot be revoked without the consent
of the donee except on the grounds provided by law
such as inofficiousness, failure of the donee to
comply with the charges imposed in the donation or
by reason of ingratitude (Id. at 653-654).
ACCEPTANCE MAY BE IN:
1. Same instrument in which case there is already
knowledge of the acceptance, hence the
donation is already perfected (Laureta v. Mata,
G.R. No. L-19740, March 22, 1923); or
2. Separate instrument (Lagazo v. CA, G.R. No.
112796, March 5, 1998).
There must be proof that a formal notice of such
acceptance was received by the donor. If real
property is involved, it must be noted in both the deed
of donation and separate instrument (Lagazo v. CA,
G.R. No. 112796, March 5, 1998).
In Sumipat v. Banga, this Court declared that title to
immovable property does not pass from the donor to
the donee by virtue of a Deed of Donation until and
unless it has been accepted in a public instrument
and the donor duly notified thereof. The acceptance
may be made in the very same instrument of
donation. If the acceptance does not appear in the
same document, it must be made in another. Where
the Deed of Donation fails to show the acceptance,
or where the formal notice of the acceptance, made
in a separate instrument, is either not given to the
donor or else not noted in the Deed of Donation and
in the separate acceptance, the donation is null and
void (Arangote v. Spouses Maglunob, G.R. No.
178906, February 18, 2009).
CLASSIFICATION:
1. As to effectivity:
a. Inter vivos;
b. Mortis causa; and
c. Propter nuptias – made by reason of
marriage and before its celebration, in
consideration of the same and in favor of one
or both of the future spouses (DE LEON,
Property, supra at 635-636).
2. As to perfection/ extinguishment:
a. Pure;
b. Conditional; and
c. With a term (Id.).
3. As to consideration:
a. Simple – the cause of which is the pure
liberality of the donor in consideration of the
donee’s merits;
b. Remuneratory or Compensatory – that
which is given out of gratitude on account of
the services rendered by the donee to the
donor, provided they do not constitute a
demandable debt;
c. Modal or Conditional – imposes upon the
donee a burden which is less than the value
of the thing donated (DE LEON, Property,
supra at 629-632); and
d. Onerous – imposes upon the donee a
reciprocal obligation or, to be more precise,
this is the kind of donation made for a
valuable consideration, the cost of which is
equal to or more than the thing donated
(Province of Camarines Sur v. Bodega
Glassware, G.R. No. 194199, March 22,
2017).
NOTE: Illegal or impossible conditions in simple
and remuneratory donations shall be considered
as not imposed (CIVIL CODE, Art. 727). Only
such conditions are disregarded, but the donation
itself remains valid (RABUYA, Property, supra at
760).
Donations with an onerous cause are governed
not by the law on donations but by the rules on
 contracts. Hence, on the matter of prescription of vivos or mortis causa depends upon the nature of the
actions for the revocation of onerous donation, it disposition made (Reyes v. Mosqueda, G.R. No.
was held that the general rules on prescription 45262, July 23, 1990).
applies (De Luna v. Abrigo, G.R. No. L-57455,
January 18, 1990). That the document in question in this case was
captioned "Donation Mortis Causa" is not controlling.
A stipulation in the donation that it was made for This Court has held that, if a donation by its terms is
and in consideration of the “love and affection inter vivos, this character is not altered by the fact that
which the donee inspires in the donor, and as an the donor styles it mortis causa (Del Rosario v.
act of liberality and generosity” is sufficient cause Ferrer, G.R. No. 187056, September 20, 2010).
for a donation (Quilala v. Alcantara, G.R. No.
132681, December 3, 2001). DONATION INTER VIVOS V. DONATION
MORTIS CAUSA
SIMPLE OR REMUNERATORY
DONATION INTER DONATION MORTIS
DONATION V. VIVOS CAUSA
ONEROUS DONATION
SIMPLE/ ONEROUS As to the Time of Taking Effect
REMUNERATORY
Takes effect Takes effect only upon
As to Governing Law independently of the the death of the donor
donor’s death. (CIVIL CODE, Art.
Primarily, the law on The law on contracts 777).
donations governs; governs.
while the law on As to the Intention of Making Donation
contracts may apply NOTE: In modal
Made out of the donor's Made in contemplation
suppletorily. donations, the law on
pure generosity. of his death without the
contracts governs up to
intention to lose the
extent of the burden;
thing or its free disposal
while the law on
in case of survival.
donations on the portion
that exceeds the value As to the Time the Title is Conveyed
of the burden.
Title conveyed to the Title conveyed to the
As to Legal Formalities donee before the donee upon the donor's
donor’s death. death.
Arts. 748 and 749 must Arts. 748 and 749 are
be complied. not applicable. As to its Validity
As to Effect of Illegal or Impossible Valid if the donor Void if donor survives
Conditions survives the donee. donee.
The illegal or The obligation with As to its Revocability
impossible conditions illegal or impossible
are considered as not conditions shall be Generally irrevocable Always revocable at
imposed but the annulled under Art. during the donor's any time and for any
donation remains valid. 1183. lifetime except for reason before the
(RABUYA, Property, supra at 760). grounds provided by law donor’s death (CIVIL
(CIVIL CODE, Arts. 760, CODE, Art. 828).
and 765).
DONATION MORTIS CAUSA GOVERNED
BY RULES ON WILLS AND SUCCESSION The express
Donations which are to take effect upon the death of "irrevocability" of the
the donor partakes of the nature of testamentary donation is the
provisions and shall be governed by the rules "distinctive standard
established in the Title on Succession (CIVIL CODE, that identifies the
Art. 728). document as a donation
inter vivos." Here, the
The title given to a Deed of Donation is not the donors plainly said that
determinative factor which makes the donation “inter it is "our will that this
vivos” or “mortis causa.” Whether a donation is inter Donation Mortis Causa
 donation shall pertain to the donee (CIVIL CODE, Art.
DONATION INTER DONATION MORTIS
729).
VIVOS CAUSA

shall be irrevocable and Art. 729 speaks of donations in praesenti which take
shall be respected by effect during the lifetime of the donor but the property
the surviving spouse." shall be delivered only after the donor’s death. Such
The intent to make the donations are inter vivos although the subject matter
donation irrevocable is not delivered at once, or the delivery is to be made
becomes even clearer post mortem, which is a simple matter of form and
by the proviso that a does not change the nature of the act (Vita v.
surviving donor shall Montanano G.R. No. L-50553, February 19, 1991).
respect the irrevocability
of the donation. Conditions beyond the natural expectation of life
Consequently, the of the donor
donation was in reality a The fixing of an event or the imposition of a
donation inter vivos (Del suspensive condition, which may take place beyond
Rosario v. Ferrer, G.R. the natural expectation of life of the donor, does not
No. 187056, September destroy the nature of the act as a donation inter vivos,
20, 2010). unless a contrary intention appears (CIVIL CODE,
Art. 730).
As to its Legal Formalities
REASON: Fulfillment of the suspensive condition is
Must comply with the Must comply with the retroactive to the making of the donation (CIVIL
formalities required by formalities required by CODE, Art. 1187).
Arts. 748 and 749 of the law for the execution of
Code. wills. When a person donates something, subject to the
resolutory condition of the donor’s survival, there is a
As to the Date of its Acceptance donation inter vivos (CIVIL CODE, Art. 731).
Must be accepted by the The validity of automatic reversion upon the
Can only be accepted
donee during his
after the donor’s death. happening of the resolutory condition of non-
lifetime. compliance is valid (De Luna v. Abrigo, G.R. No. L-
57455, January 18, 1990). However, where one of
As to its Tax Implication
the parties contests or denies the rescission, “only the
Subject to donor’s tax. Subject to estate tax. final word of the court of competent jurisdiction can
conclusively settle whether resolution is proper or
(2 PARAS, supra at 882-885). not” (UP v. De los Angeles, G.R. No. L-28602,
September 29, 1970).
In case of doubt, inter vivos
In case of doubt, the conveyance should be deemed INSTANCES OF DONATIONS INTER
donation inter vivos rather than mortis causa, in order
to avoid uncertainty as to the ownership of the VIVOS:
property subject of the deed (Puig v. Peñaflorida, 1. A donation where the causes of revocation have
G.R. No. L-15939, January 31, 1966). been specified (Zapanta v. Posadas, G.R. No. L-
29204, December 29, 1928);
The legal principle that in case of doubt as to 2. A donation where the donor reserved for himself
gratuitous contracts, construction must effect “the a lifetime usufruct of the property, for if he were
least transmission of rights and interests” (CIVIL still the owner, there would be no need of said
CODE, Art. 1378). reservation (Balaqui v. Dongso, G.R. No. L-
31161, October 28, 1929);
DONATIONS IN PRAESENTI 3. A donation where the donor warrants the title to
the thing which he is donating (Balaqui v.
When the donor intends that the donation shall take
Dongso, G.R. No. L-31161, October 28, 1929) –
effect during the lifetime of the donor, though the
there would be no need of warranty were he not
property shall not be delivered till after the donor’s
be transferring the title;
death, this shall be a donation inter vivos (CIVIL 4. Where the donor immediately transferred the
CODE, Art. 729). ownership, possession, and administration of the
property to the donee, but stipulated that the right
Unless the donor provides otherwise, the fruits of the
of the donee to harvest and alienate the fruits
property from the time of the acceptance of the
would begin only after the donor’s death (De
Guzman v. Ibea, G.R. No. L-45724, April 27,
 1939). However, if what had been transferred in
the meantime was only the administration of the
property, the donation is mortis causa (Carino v.
Abaya, G.R. No. 46706, June 26, 1940);
5. Where the donor stated that while he is alive he
would not dispose of the property or take away
the land “because I am reserving it to him (the
donee) upon my death” (Cuevas v. Cuevas, G.R.
No. L-8327, December 14, 1955); and
6. One where the donees “should not as yet get the
possession until our demise”, the administration
remaining with the donor spouses, or either one
surviving (Guarin v. De Vera, G.R. No. L-8577,
February 28, 1957).
INSTANCES OF DONATIONS MORTIS
CAUSA:
1. One where the registration of the deed before the
donor’s death is prohibited (Puig v. Penaflorida,
G.R. No. L-15939, January 31, 1966);
2. Donation which will take effect and pass title only
by and because of death (Howard v. Padilla, G.R.
No. L-7064, April 22, 1955);
3. If the donor retains full and naked ownership and
control over the property while he is still alive
(Heirs of Bonsato v. CA, G.R No. L-6600, July 30,
1954);
4. One where properties will be delivered after
donor’s death (Cariño v. Abaya, G.R. No. 46706,
June 26, 1940);
5. Where the right to dispose and enjoy is reserved
by the donor (Austria-Magat v. CA, G.R. No.
106755, February 1, 2002); and
6. Donation which makes no actual conveyance
before the donor’s death (David v. Sison, G.R.
No. 49108, March 28, 1946).
DONORS
The donor must have both the capacity to contract
and to dispose (CIVIL CODE, Art. 735), and is not
specifically prohibited to make a donation (CIVIL
CODE, Art. 739).
NOTE: Donor’s capacity shall be determined as of
the time of the making of the donation (CIVIL CODE,
Art. 737).
“Making” means “perfection” of the donation,
otherwise if “making” means “giving,” Art. 737 would
in some cases be inconsistent with Art. 734 which
states that “the donation is perfected from the
moment the donor knows of the acceptance by the
donee.” To avoid a contradiction, the rule may be
stated thus: “at the time the donation is perfected,
both the donor and the donee must be capacitated.”
The subsequent incapacity of the donor does not
affect the validity of the donation (2 PARAS, supra at
902).
DONATION BETWEEN SPOUSES
Under Art. 85 of the Family Code, every donation
between spouses during the marriage shall be void
except moderate gifts on the occasion of family
rejoicing. The prohibition applies also to persons
living together as husband and wife without benefit of
marriage (Ching v. Goyanko, G.R. No. 165879,
November 10, 2006).
DIFFERENCES OF CAPACITIES
BETWEEN THE HUSBAND AND WIFE TO
DONATE CONJUGAL PROPERTY:
Husband: He is capacitated to enter into a valid
contract if he is sui juris. He can donate conjugal
property without wife’s consent if these are:
1. Moderate donations given for charity or for times
of family rejoicing or distress; or
2. Donations to common legitimate children for
purposes of commencing a professional or
vocational course or other activity for self-
improvement (2 PARAS, supra at 898-899).
Wife: Unless she is the administratrix of the conjugal
partnership, she cannot donate conjugal property
without the consent of her husband (Id. at 899).
PROHIBITION OF DONATION BY
CORPORATION TO POLITICAL PARTY
Under Sec. 36 the Corporation Code (now Sec. 35 of
the Revised Corporation Code), every corporation
has the power and capacity, inter alia, to make
reasonable donations, including those for the public
welfare or for hospital, charitable, cultural, scientific,
civic, or similar purposes. However, foreign
corporations cannot give donations in aid of any
political party or candidate or for purposes of partisan
political activity (REVISED CORPORATION CODE,
Sec. 35).
NOTE: Donations inter vivos made by incapacitated
donors are merely voidable. Same rule applies where
consent is vitiated (2 PARAS, supra at 899).
GUARDIANS AND TRUSTEES CANNOT
ALIENATE PROPERTY ENTRUSTED TO
THEM (CIVIL CODE, ART 736):
1. This prohibition is not absolute. It is applicable
only in case of simple donation, but not where the
donation is onerous and is beneficial to the
beneficiary (DE LEON, Property, supra at 661).
2. Trustees, who have repudiated the trust and
have acquired the properties by prescription, are
allowed to donate said properties (2 PARAS,
supra at 900).
DONEES
GENERAL RULE: All those who are not specially
disqualified by law may accept donation (CIVIL
CODE, Art. 738).
EXCEPTIONS: Donations may be made to
incapacitated persons such as:
1. Minors, and others who cannot enter into a
contract, but acceptance shall be done through
their parents or legal representatives (CIVIL
CODE, Art. 741); and
2. Conceived and unborn children, acceptance of
which may be made by those persons who would
legally represent them if they were already born
(CIVIL CODE, Art. 742), provided it be for
purposes that are favorable to it (CIVIL CODE,
Arts. 40 and 41). Otherwise, it is as if the
conceived child possessed no juridical
personality (2 PARAS, supra at 908).
NOTE: The donee must accept the donation
personally, or through an authorized person with
a special power for the purpose, or with a general
and sufficient power; otherwise, the donation
shall be void (CIVIL CODE, Art. 745).
Concept of innocent purchaser for value does not
apply to gratuitous transfers
Under Section 53 of Presidential Decree No. 1529,
known as the Property Registration Decree, in all
cases of registration procured by fraud, the owner
may pursue all his legal and equitable remedies
against the parties to such fraud without prejudice,
however, to the rights of any innocent holder for value
of a certificate of title. Here, a donee is not an
innocent holder for value for the reason that he
acquires property gratuitously by a Deed of Donation
and not by purchase. Hence, the concept of an
innocent purchaser for value cannot apply to him
(Gambito v. Bacena, G.R. No. 225929, January 24,
2018).
DONATION PROHIBITED BY LAW:
(ACOP-WIG-PUS)
1. Those made between persons who were guilty of
Adultery or concubinage at the time of the
donation (CIVIL CODE, Art. 739(1));
NOTE: Previous criminal conviction is not
necessary; the guilt may be proven in a civil
action for declaration of nullity of donation
personality (2 PARAS, supra at 909).
2. Those made between persons found guilty of the
same Criminal offense in consideration thereof
(CIVIL CODE, Art. 739(2));
NOTE: Previous criminal conviction is necessary
(2 PARAS, supra at 912).
3. Those made to a public Officer or his/her spouse,
descendants, or ascendants in consideration of
his/her office (CIVIL CODE, Art. 739(3));
4. Those made to the Priest who heard the
confession of the donor during the latter’s last
illness, or the minister of the gospel who
extended spiritual aid to him during the same
period, or to the relatives of such priest or
minister of the gospel within the fourth (4th) civil
degree or the church to which such priest or
minister belongs (CIVIL CODE, Art. 1027-1032);
5. Those made to an attesting Witness to the
execution of donation, his spouse, parents, or
children, or anyone claiming under such witness,
spouse, parents, or children (CIVIL CODE, Art.
1027);
6. Those made to Individuals, associations or
corporations not permitted by law to inherit (CIVIL
CODE, Art. 1027);
7. Those made by a ward to his or her Guardian
before the approval of the final accounts of the
guardianship (CIVIL CODE, Art. 1027);
8. Those made to a Physician, surgeon, nurse,
health officer or druggist who took care of the
donor during his/her last illness (CIVIL CODE,
Art. 1027);
9. Donations void by reason of Unworthiness of
donee under Art. 740 in re Art. 1032. However, if
the donor had knowledge, or subsequently knew
of the act of unworthiness of donee and
condoned the same in writing, the donation is
valid (CIVIL CODE, Art. 1033); and
10. Made by Spouses to each other during the
marriage or to persons of whom the other spouse
is a presumptive heir (CIVIL CODE, Art. 1027).
FORMS OF DONATIONS (CIVIL CODE,
ARTS. 748 AND 749)
1. Donations of movable property:
a. If value of property exceeds P5,000,
donation and acceptance must always be in
writing; otherwise, the same is void (2
PARAS, supra at 919-920).
NOTE: Simultaneous delivery of property
donated is not required (Id.).
b. If value of property is less than P5,000,
donation may be made orally or in writing
i. If orally, simultaneous delivery is
required (actual or constructive) for
validity; or
ii. If in writing, donation is valid although no
simultaneous delivery (Id.).
 NOTE: Acceptance may be made orally or in
writing (DE LEON, Property, supra at 672-
673).
2. Donation of immovable property:
a. Must always be in a public instrument
specifying the property donated and the
burdens assumed by donee, regardless of
value.
b. Acceptance must be either:
i. In the same instrument; or
ii. In another public instrument, notified to
the donor in authentic form, and noted in
both deeds (CIVIL CODE, Art. 749).
NOTE: Article 749 does not apply to onerous
donations, which are governed by the rules on
obligations and contracts (CIVIL CODE, Art. 733).
Expression of gratitude to the donor without express
acceptance was held a sufficient acceptance
(Cuevas v. Cuevas G.R. No. L-8327, December 14,
1955).
A donation of immovable to be valid must be in a
public instrument. However, even if void, it can be the
basis of acquisitive prescription for as long as there
is adverse possession in the concept of an owner
(Bautista v. Poblete, G.R. No. 141007, September
13, 2005).
It is settled that a defective notarization will strip the
document of its public character and reduce it to a
private instrument. Article 749 of the Civil Code
requires that donation of real property must be made
in a public instrument to be valid. Donation of real
property is void without the formalities specified in the
foregoing provision. Here, the purported Deed of
Donation submitted by the City cannot be considered
a public document. While it contains an
Acknowledgment before a notary public, the same is
manifestly defective as it was made neither by the
alleged donors and their respective spouses, or by
the done (Heirs of. Mariano v. City of Naga, G.R. No.
197743, March 12, 2018).
Although the non-registration of a deed of donation
shall not affect its validity, the necessity of registration
comes into play when the rights of third persons are
affected (Gonzales v. CA, G.R. No. 110335, June 18,
2001).
LIMITATIONS ON DONATION OF
PROPERTY:
1. Donation may comprehend all the
present property of the donor, provided
that:
a. If the donor has forced heirs: he cannot
give or receive by donation more than what
he can give or receive by will (CIVIL CODE,
Art. 752); and
b. If the donor has no forced heirs: donation
may include all present property provided he
reserves in full ownership or in usufruct:
i. The amount sufficient to support him and
those relatives entitled to support from
him (CIVIL CODE, Art. 750); and
ii. Property sufficient to pay the donor’s
debt contracted prior to the donation
(CIVIL CODE, Art. 759).
NOTE: Without such reservation, the
donation shall be reduced on petition of any
persons affected. Donation is still valid (DE
LEON, Property, supra at 685).
The limitation applies only to simple,
remunerative, and modal donations, but not to
onerous ones, which are governed by the law on
contracts (Id. at 686).
Donations propter nuptias cannot exceed more
than 1/5th of the present property of the future
spouses, under a regime other than the absolute
community of property (FAMILY CODE, Art. 84).
2. Donations cannot comprehend future
property (CIVIL CODE, Art. 751);
Future property
Anything which the donor cannot dispose of at
the time of the donation (CIVIL CODE, Art. 751).
NOTE: Future inheritance cannot be the object of
donation, but present or accrued inheritance may
be, even if the properties have not yet been
delivered (2 PARAS, supra at 929).
NOTE: Upon the death of his predecessor, the
share in an existing inheritance is present
property although the heir has not yet entered
into possession of the same (Osorio v. Osorio,
G.R. No. 16544, March 30, 1921). This is based
on the principle of law that nobody can dispose of
that which does not belong to him (DE LEON,
Property, supra at 687).
3. Donation should not prejudice creditors
(CIVIL CODE, Art. 759); and
4. Donee must reserve sufficient means for
his support and for his relatives which
are entitled to be supported by him (CIVIL
CODE, Art. 750).
EFFECTS OF DONATION:
1. When the donation is made to several persons
jointly, it is understood to be in equal portions,
without accretion among them, unless the donor
has otherwise provided (CIVIL CODE, Art. 753,
Par. 1).
Generally, there is no accretion. By virtue of
accretion, the share of the donee who dies ahead
of the donor before perfection, or who is
incapacitated, or who repudiates or refuses the
donation, goes to the co-donees, provided that
accretion is proper (CIVIL CODE, Art. 1015).
Thus, when a donation was given to A and B, and
the former refuses to accept, B will not get A’s
share unless the donor has provided otherwise.
NOTE: There is a right of accretion in donations
made between husband and wife jointly, if the
contrary has not been provided by the donor
(CIVIL CODE, Art. 753, Par. 2).
2. Donee may demand the delivery of the thing
donated;
3. Donee is subrogated to all the rights and actions
which in case of eviction would pertain to the
donor (CIVIL CODE, Art. 754);
4. Donor’s warranty exists if (EPOB):
a. Expressed
b. Donation is Propter nuptias
c. Donation is Onerous, thus if simple or
remunerative, the donor is not liable for
eviction or hidden defects
d. Donor is in Bad faith (CIVIL CODE, Art. 754).
5. In donations propter nuptias, the donor must
release the property from encumbrances, except
servitudes.
DONATION WITH RESERVATIONS ON
THE RIGHT TO DISPOSE
The right to dispose of some of the things donated, or
of some amount which shall be a charge thereon,
may be reserved by the donor. However, if he should
die without having made use of this right, the property
or amount reserved shall belong to the done (CIVIL
CODE, Art. 755).
DONATION OF NAKED OWNERSHIP
(DOMINIUM DIRECTUM) AND USUFRUCT
(DOMINIUM UTILE)
The ownership of property may also be donated to
one person and the usufruct to another or others,
provided all the donees are living at the time of the
donation (CIVIL CODE, Art. 756).
NOTE: In fidei commissary substitution, a similar
limitation is imposed (See CIVIL CODE, Art. 863).
If the property donated is immovable, the formalities
for donations of real property must be made in a
public instrument and complied with (CIVIL CODE,
Art. 749).
REASON: The naked ownership and usufruct over
real property are real properties themselves (CIVIL
CODE, Art. 749).
CONVENTIONAL REVERSION
Reversion may be validly established in favor of only
the donor for any case and circumstances, but not in
favor of other persons unless they are all living at the
time of the donation (CIVIL CODE, Art. 757).
Any reversion stipulated by the donor in favor of third
person in violation of this provision shall be void, but
shall not nullify the donation (CIVIL CODE, Art. 757).
A reversion in favor of an unconceived child is void,
but such nullity shall not invalidate the donation (See
CIVIL CODE, Art. 1230).
REASON: A reversion is merely an accessory clause
that may be disregarded. The nullity of the donation
itself carries with it that of the reversion (DE LEON,
Property, supra at 692).
PAYMENT OF THE DONOR’S DEBT BY THE
DONEE:
1. If there is express stipulation: the donee is to
pay only debts contracted before the
donation, if not otherwise specified. He shall
answer only for the debts up to the value of the
property donated unless the contrary is
stipulated (Id. at 693).
2. If there is no stipulation: the one is answerable
for the debts of the donor only in case of fraud
against creditors (Id.).
The donation is always presumed to be in fraud
of creditors, when at the time thereof, the donor
did not reserve sufficient property to pay his
debts prior to the donation. Presumption is
rebuttable (Id.).
Remedy of Creditors: Exercise subsidiary right
of rescission (CIVIL CODE, Art. 1381, Par. 1.).
GROUNDS FOR REVOCATION OF
DONATION (BA2NI)
1. Birth, Appearance, or Adoption of a child
(CIVIL CODE, Art. 760);
Every donation inter vivos, made by a person
having no children or descendants, legitimate or
legitimated by subsequent marriage, or
illegitimate, may be revoked or reduced by the
happening of any of these events:
a. If the donor, after the donation, should have
legitimate or legitimated or illegitimate
children, even though they be posthumous;
b. If the child of the donor, whom the latter
believed to be dead when he made the
donation, should turn out to be living; and
c. If the donor subsequently adopts a minor
child (CIVIL CODE, Art. 760).
. where donee denies donor’s right to rescind
Applies to all donations inter vivos, and not to
donation mortis causa, onerous donations, and
donations propter nuptias (2 PARAS, supra at
945-946).
This contemplates a situation wherein the donor,
at the time he made the donation, did not have
any child or descendant or erroneously thought
he had no more. If the donor had at least one
child already at the time he made the donation,
apply Arts. 771 and 752 (Id.).
The action for revocation under this ground
shall prescribe after four (4) years from:
a. The birth of the first child;
b. His legitimation, recognition or adoption;
c. The judicial declaration of filiation; or
d. The time information was received regarding
the existence of the child believed dead
(CIVIL CODE, Art. 763).
NOTE: The donee shall not return the fruits,
except from the filing of the complaint (CIVIL
CODE, Art.768).
“First child” in the first instance refers to first
legitimate child (2 PARAS, supra at 948).
NOTE: If the cause or ground disappears, such
as when the child dies before the action to reduce
is judicially commenced, the donation should
remain valid (3 Navarro Amandi 59 as cited in 2
PARAS, supra at 949).
2. Non-fulfillment of a condition (CIVIL CODE,
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 (CIVIL CODE, Art. 764).
Condition shall refer to any obligation, charge, or
burden imposed by the donor in his favor or that
of another. It may be resolutory (CIVIL CODE,
Art. 732), but not suspensive, for non-fulfillment
means the donation never became effective
(Parks v. Province of Tarlac, G.R. No. 24190,
July 13, 1926).
In the absence of affirmative proof to the
contrary, the presumption is that the donee has
complied with his obligation under the deed of
donation. The claim that the donee failed to do so
is a matter of defense which the donor is duty
bound to established by competent evidence (DE
LEON, Property, supra at 699).
Automatic Reversion/Revocation Clause
Judicial intervention is not necessary, except
(Roman Catholic Archbishop of Manila v. CA,
G.R. No. 77425, June 19, 1991).
As reiterated in Roman Catholic Archbishop of
Manila that where a donation has an automatic
revocation clause, the occurrence of the
condition agreed to by the parties as to cause the
revocation, is sufficient for a party to consider the
donation revoked without need of any judicial
action. A judicial finding that the revocation is
proper is only necessary when the other party
actually goes to court for the specific purpose of
challenging the propriety of the revocation.
Nevertheless, even in such a case, "x xx the
decision of the court will be merely declaratory of
the revocation, but it is not in itself the revocatory
act." (Province of Camarines Sur v. Bodega
Glassware, G.R. No. 194199, March 22, 2017).
Necessity of court action
In absence of such automatic reversion/
revocation clause, judicial intervention is
necessary (De Luna v. Abrigo, G.R. No. L-57455,
January 18, 1990).
Revocation at the instance of the donor or his
heirs (CIVIL CODE, Art. 770).
Only the final word of the court of competent
jurisdiction can conclusively settle whether
resolution is proper or not (UP v. de los Angeles,
G.R. No. L-28602, September 29, 1970).
Rules:
a. The property donated shall be returned to
the donor (CIVIL CODE, Art. 764);
b. If the property is sold, donated or mortgaged,
the alienation or encumbrance will be
considered void, unless the grantee be an
innocent third party (CIVIL CODE, Art. 764);
 c. The actions shall prescribe after 4 years
from the non-compliance with the condition
(CIVIL CODE, Art. 764);
d. Said action may be transmitted to the heirs
of the donor, and may be exercised against
the donee’s heirs (CIVIL CODE, Art. 764);
and
e. The donee shall return not only the property
but also the fruits thereof which he may have
received after having failed to fulfill the
condition (CIVIL CODE, Art. 768).
3. Ingratitude of the Donee;
Acts of Ingratitude:
a. If the donee should commit some offense
against the person, the honor or property
of the donor, or of his wife or children under
his parental authority;
NOTE: “Offense” includes both crimes and
non-crimes; no criminal conviction is
required. Mere preponderance of evidence
would be sufficient (2 PARAS, supra at 955).
b. He imputes to the donor any criminal
offense, or any act involving moral
turpitude, even though he should prove it,
unless the crime or the act has been
committed against the donee himself, his
wife or children under his authority; and
c. He unduly refuses him support when the
donee is legally or morally bound to give
support to the donor (CIVIL CODE, Art. 765).
NOTE: Art. 765 is exclusive and must have been
committed by the donee personally (DE LEON,
Property, supra at 789).
All crimes which affect the donor show ingratitude
and are causes for revocation (Sps. Eduarte v.
CA, G.R. No. 105944, February 9, 1996).
Falsification of a deed of donation is an act of
ingratitude (Noceda v. CA, G.R. No. 119730,
September 2, 1999).
Where the certificate of title was already
transferred from the name of the true owner to
the forger, and while it remained that way, the
land was subsequently sold to an innocent
purchaser. For then, the vendee had the right to
rely upon what appeared in the certificate (Sps.
Eduarte v. CA, G.R. No. 105944, February 9,
1996).
Although the donation is revoked on account of
ingratitude, the alienations and mortgages
effected before the notation of the complaint for
revocation in the Registry of Property shall
subsist. Later ones shall be void (CIVIL CODE,
Art. 766).
Ingratitude of donee finds no application if the
donation is onerous (Calasan v. Donorito, G.R.
No. 171937, November 25, 2013).
For alienations and mortgages effected
before notation of the complaint, the donor
shall have a right to demand from the donee:
a. The value of the property alienated which he
cannot recover from third persons; or
b. The sum for which the same has been
mortgaged (CIVIL CODE, Art. 767).
The donee shall not return the fruits, except from
the filing of the complaint (CIVIL CODE, Art. 768).
The action granted to the donor by reason of
ingratitude cannot be renounced in advance.
Said action prescribes in 1 year, to be counted
from the time the donor had knowledge of the fact
and it was possible for him to bring the action.
Thus, if immediately after knowledge of the fact,
the donor becomes unconscious for 6 months,
the period of 6 months shall not be counted (DE
LEON, Property, supra at 712-713).
REVOCATION OF ONEROUS
DONATIONS
The action for revocation of an onerous donation
does not prescribe in 4 years. It is governed by the
law on contracts. It prescribes in 10 years (Sec. of
Education v. Heirs of Rufino Dulay, G.R. No. 164748,
January 27, 2006).
GROUNDS FOR REDUCTION OF
2
DONATION: (BA SDI)
1. Birth, Appearance, or Adoption of a child (CIVIL
CODE, Art. 760);
2. Failure of the donor to reserve sufficient means
for Support of himself or dependent relatives
(CIVIL CODE, Art. 750);
3. Failure of the donor to reserve sufficient property
to pay off his existing Debts (CIVIL CODE, Art.
759); and
4. Inofficious, that is, the donation exceeds that
which the donor can give by will (CIVIL CODE,
Arts. 752 and 771).
a. For purposes of reduction, the value of the
estate is that which it had, at the time of
donor’s death, and at the time of the
donation.
 Formula:
Net Hereditary Estate = property left minus
debts and charges plus the value of the
donation.
b. The donee shall not return the fruits, except
from the filing of the complaint (CIVIL CODE,
Art.768).
NOTE: If a Deed of Donation expressly provides
for automatic reversion of the property donated in
case of violation of a condition therein, a judicial
declaration revoking the same is not necessary.
The rules on contracts and the general rules on
prescription 10 years to recover in case of written
contracts should apply and not the 4-year
prescriptive period under Art. 764 of the Civil
Code (Roman Catholic Archbishop of Manila v.
CA, G.R. No. 77425, June 19, 1991).

SUMMARY ON RULES OF REVOCATION

BASED ON BIRTH, APPEARANCE, BASED ON NON-COMPLIANCE BASED ON ACTS OF
OR ADOPTION OF A CHILD WITH CONDITION/S INGRATITUDE
(CIVIL CODE, ART. 760) (CIVIL CODE, ART. 764) (CIVIL CODE, ART. 765)

As to Time of Action

Within four (4) years from birth of the Within four (4) years from non- Within one (1) year from the time
first child, or from his legitimation compliance. the donor had knowledge of the
(recognition), or adoption, or from fact and it was possible for him to
judicial declaration of filiation, or from bring the action.
receipt of information on existence of
the child believed dead (CIVIL CODE,
Art. 763, Par. 1).

As to Transmissibility of Action

The action is transmitted to children and The action is transmitted to Generally, not transmissible, nor
descendants of donor upon his death donor’s heir and may be exercised can the action be filed against
(CIVIL CODE, Art. 763, Par. 2). against the donee’s heir (CIVIL heirs of done (CIVIL CODE, Art.
CODE, Art. 764). 770).

As to Effect of Revocation

The property affected shall be: The property donated shall be: The property donated shall be:
1. Returned; 1. Returned to the donor; and 1. Returned but the alienations;
2. Its value if donee has sold the same; 2. The alienations and mortgages and
or are void, subject to the rights of 2. Mortgages effected before
3. The donor may redeem the innocent third persons (CIVIL the notation of the complaint
mortgage on the property, with a CODE, Art. 764 Par. 2). for revocation in the Registry
right to recover (CIVIL CODE, Art. of Property shall subsist
762, Par. 2). (CIVIL CODE, Art. 766)

As to Liability for Fruits

The donee shall return the fruits The donee shall return the fruits Same in Art. 768, Par. 1.
accruing from the filing of the complaint which he may have received after
(CIVIL CODE, Art. 768, Par. 1). having failed to fulfill the condition
(CIVIL CODE, Art. 768, Par. 2).
 SUMMARY ON RULES ON REDUCTION
BASED ON FAILURE BASED ON BIRTH, BASED ON BEING BASED ON FRAUD
OF DONOR TO APPEARANCE OR INOFFICIOUS, IN AGAINST CREDITORS
RESERVE SUFFICIENT ADOPTION OF A CHILD EXCESS OF WHAT (CIVIL CODE, ART. 759)
MEANS FOR SUPPORT (CIVIL CODE, ART. 760) DONOR MAY GIVE BY
(CIVIL CODE, ARTS. WILL (CIVIL CODE,
750) ARTS. 750, 711)

As to Time of Action

By donor: at any time Within five (5) years after The action for rescission
donor’s death (CIVIL must be brought within
By those entitled to support: during donor’s lifetime. CODE, Arts. 771 and four (4) years under Art.
1149). 1389.

As to Transmissibility of Actions

Not transmissible for right to support is personal in Transmitted to the donor’s Transmitted to the
nature (FAMILY CODE, Art. 195). heirs as the donation shall creditor’s heirs or
be reduced as regards the successors-in-interest
excess (CIVIL CODE, Art. (CIVIL CODE, Art. 1389).
771).

As to Effect of Reduction

To the extent necessary to provide for support (CIVIL The donation takes effect
CODE, Art. 750). during the lifetime of the
donor subject to reduction
only upon his death with
regard to the excess
(CIVIL CODE, Art. 771).
Property affected shall be
returned by the done for
the benefit of the creditor,
subject to the rights of
innocent third persons
(CIVIL CODE, Art. 1387).

As to Right to/Liability for fruits

Donee is entitled to the
fruits as owner of property
donated (CIVIL CODE,
Art 729).
Donee as owner, is not Donee appropriates fruits The fruits shall be
affected by reduction as owner (CIVIL CODE, returned if done in bad
(CIVIL CODE, Art. 441) Art. 441). faith, and if it is impossible
but with regard to excess, to return the property, to
he shall be liable only for be held liable for damages
those accruing from the (CIVIL CODE Art. 1388,
filing of the complaint Par. 1).
(CIVIL CODE Art. 768,
Par. 1).
 iv. Lapse of Time provided by law (DE
PRESCRIPTION LEON, Property, supra at 723).

(ARTS. 1106-1155) 2. Extinctive prescription (Article 1106, Par.

2)
– rights and actions are lost through the lapse of
time in the manner and under the conditions laid
Concept: It is a means of acquiring ownership and
down by law. It is also called limitation of actions
other real rights or losing rights or actions to enforce
(DE LEON, Property, supra at 723).
such rights through the lapse of time (DE LEON,
Property, supra at. 721).
ACQUISITIVE V. EXTINCTIVE
TYPES OF PRESCRIPTION: PRESCRIPTION
1. Acquisitive prescription ACQUISITIVE EXTINCTIVE
– one acquires ownership and other real rights PRESCRIPTION PRESCRIPTION
through the lapse of time in the manner and
under the conditions laid down by law (CIVIL As to the Operative Act
CODE, Art. 1106).
Relationship between One does not look to
a. Ordinary acquisitive prescription: requires the occupant and the the act of the
possession of things in good faith and with land in terms of possessor but to the
just title for the time fixed by law (CIVIL possession is capable of neglect of the owner.
CODE, Art. 1117, Par. 2). producing legal
consequences; it is the
NOTE: Just title here means merely possessor who is the
colorable title, i.e., although there was a actor.
mode of transferring ownership, the grantor
As to Requisites
was not the owner (Doliendo v. Biarnesa,
G.R. No. 2765, Dec. 27, 1906). Requires possession by Requires inaction of
a claimant who is not the the owner or neglect of
The Court accepted the opinion of a learned owner. one with a right to bring
Spanish law writer who holds that the "titulo his action.
verdadero y valido" as used in this article of
the code prescribes a "titulo Colorado" and As to its Applicability
not merely "putativo;" a "titulo Colorado"
being one 'which a person has when he buys Applicable to ownership Applies to all kinds of
a thing, in good faith, from one whom he and other real rights. rights, whether real or
believes to be the owner,' and a "titulo personal.
putativo" "being one which is supposed to
have preceded the acquisition of a thing, As to its Legal Effect
although in fact it did not, as might happen
Vests ownership or Produces the extinction
when one is in possession of a thing in the
other real rights in the of rights or bars a right
belief that it had been bequeathed to
occupant. of action.
him."(Aguirre v. Court of Appeals, G.R. No.
122249, January 29, 2004).
Results in the Results in the loss of a
acquisition of ownership real or personal right,
b. Extraordinary acquisitive prescription:
or other real rights in a or bars the cause of
acquisition of ownership and other real rights
person as well as the action to enforce said
without need of title or of good faith or any
loss of said ownership or right.
other condition (CIVIL CODE, Art. 1137).
real rights in another.
Requisites (CTPT): As a Defense
i. Capacity to acquire by prescription
(National Power Corporation v. Campos Can be proven under the Should be affirmatively
Jr., G.R. No. 143643, June 27, 2003); general issue without its pleaded and proved to
ii. A Thing capable of acquisition by being affirmatively bar the action or claim
prescription; pleaded. of the adverse party.
iii. Possession of thing under certain
conditions; and (Id. at 724).
RATIONALE OF PRESCRIPTION:
1. Prescription is of purely statutory origin and is
founded on ground of public policy. Time limit is
imposed for a party to enforce his claim so that
titles to property and other rights will be
stabilized. It protects the diligent and vigilant, not
the person who sleeps on his rights (Id. at 725).
Without a time limit within which a party may
enforce his claim, titles to property and other
rights will remain unstable for a long time and
wasteful litigations will be fostered (Id. at 726).
2. Prescription is rightly regarded as a statute of
repose whose object is to suppress fraudulent
and stale claims. Our laws favor not property
rights hanging in the air for an uncertain time
(Multi-Realty Dev. Corp v. Makati Tuscany, G.R.
No. 146726, June 16, 2006).
PRESCRIPTION AS A MATTER OF
DEFENSE
Burden of proof: Rests on the party laying claim to
it (Id. at 729).
Effect of failure to plead prescription:
Failure to plead constitutes waiver of the defense
and cannot be raised for the first time at the trial or on
appeal (Id.).
GENERAL RULE: The issue of prescription is one
involving evidentiary matters requiring a full-blown
trial on the merits and cannot be determined in a
mere motion to dismiss (Id. at 730).
EXCEPTIONS:
1. When the plaintiff’s complaint on its face or the
evidence he presented shows clearly that indeed
the action has prescribed at the time it was filed.
2. If, before trial, a party has no means of knowing
that opponent’s claim has already lapsed,
prescription as a defense may be pleaded later
as soon as the true nature of the claim is
discovered (Id.).
LACHES
Failure or neglect for an unreasonable and
unexplained length of time, to do that which, by
exercising due diligence, one could or should have
done earlier (Tijam v. Sibonghanoy, G.R. No. L-
21450, April 15, 1968). It should be stressed that
laches is not concerned only with the mere lapse of
time (Oropeza v. Allied Banking Corp., G.R. No.
222078, April 1, 2019).
The elements of laches are (CoDeLIP):
1. Conduct on the part of the defendant, or one
under whom he claims, giving rise to the situation
that led to the complaint and for which the
complaint seeks a remedy;
2. Delay in asserting the complainant's rights,
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; and
4. Injury or Prejudice to the defendant in the event
relief is accorded to the complainant, or the suit
is not held barred (Espinas-Lanuza v. Luna, Jr.,
G.R. No. 229775, March 11, 2019).
NOTE: Laches is recourse in equity. Equity, however,
is applied only in the absence, never in contravention,
of statutory law. Thus, laches, cannot, as a rule, be
used to abate a collection suit filed within the
prescriptive period mandated by the Civil Code (De
Castro v. CA, G.R. No. 115838, July 18, 2002).
It applies even to imprescriptible actions (e.g., action
to annul a void contract may be barred by laches). Its
elements must be proved positively. Laches is
evidentiary in nature (Gochan v. Heirs of Baba, G.R.
No. 138945, August 13, 2005).
Where the law provides the period within which to
assert a claim or file an action in court, the assertion
of the claim or the filing of the action in court at any
time within the prescriptive period is generally
deemed reasonable, and thus, does not call for the
application of laches. Unless reasons of inequitable
proportions are adduced, any imputed delay within
the prescriptive period is not delay in law that would
bar relief (Phil-Air Conditioning Center v. RCJ Lines,
G.R. No. 193821, November 23, 2015).
PRESCRIPTION V. LACHES
PRESCRIPTION LACHES
As to What is Considered
Concerned with the Concerned with the effect
fact of delay. of delay.
As to Question Raised
A question or matter of A question of inequity of
time. permitting a claim to be
enforced (this inequity
being founded on some
subsequent change in the
condition or relation of the
parties).
As to Source
Statutory. Not statutory.
 required for prescription, it follows that things which
PRESCRIPTION LACHES
are not susceptible of being appropriated cannot be
As to Applicability the object of prescription (DE LEON, Property, supra
738).
Applies at law. Applies in equity.
Property of the State or any of its subdivisions not
patrimonial in character shall not be the object of
As to Availability prescription (CIVIL CODE, Art. 1113).
Cannot be availed of Need not be specifically
NOTE: Patrimonial property of the State may be
unless it is especially pleaded; court may
acquired as they are treated the same way as
pleaded as an consider it in its own
property of private individuals (DE LEON, Property,
affirmative allegation. initiative to prevent
supra at 730).
inequity.
Period of possession of public land before it became
As to Basis patrimonial is not counted for the purposes of
completing the prescriptive period (Heirs of
Based on a fixed time. Not based on a fixed Malabanan v. Republic, G.R. No. 179987, April 9,
time. 2009).
(DE LEON, Property, supra 728-729; Espinas-
Lanuza v. Luna, Jr., G.R. No. 229775, March 11, Res nullius (property without an owner) is acquired by
2019). occupation and not by prescription because
prescription presupposes a previous owner (Yu v. De
Lara, G.R. No. 16084, November 30, 1962).
CAPACITY TO ACQUIRE BY
PRESCRIPTION (CIVIL CODE, ART. 1107) Exceptions (ReSMo):
Persons who are capable of acquiring property or 1. Lands Registered under the Torrens system
rights by the other legal modes may acquire the same (P.D. No. 1529, Sec. 47);
by means of prescription (CIVIL CODE, Art. 1107, 2. Properties of Spouses, parents and children and
Par. 1). guardians and wards under certain conditions as
between themselves (CIVIL CODE, Art.1109);
Minors and other incapacitated persons may acquire and
property or rights by prescription, either personally or 3. Movables possessed through a crime (CIVIL
through their parents, guardians, or legal CODE, Art.1133).
representatives (CIVIL CODE, Art. 1107, Par. 2).
Possession has to be in the concept of an owner,
GENERAL RULE: A person must have the legal public, peaceful, and uninterrupted (CIVIL CODE,
capacity to acquire property or rights by the other Art. 1118).
legal modes in order that he may acquire the same
by means of prescription (DE LEON, Property, supra CHARACTERISTICS OF POSSESSION
at 730-731). TO BE THE BASIS OF PRESCRIPTION
EXCEPTION: Minors and other incapacitated
persons may acquire property or rights by (CIVIL CODE, ART. 1118): (OPPU)
prescription, either personally or through their 1. Concept of Owner
parents, guardians, or legal representatives (Id. at Only the possession acquired and enjoyed in the
731-732). concept of owner can serve as a title for acquiring
dominion (CIVIL CODE, Art. 540).
Unlike donation, prescription does not require
consent. It is not necessary that they have capacity Acts of a possessory character which are merely
to act as long as they have juridical capacity (Id. at tolerated by the possessor or which are due to his
732). license, do not constitute possession (DE LEON,
Property, supra at 743-745).
OBJECT OF PRESCRIPTION
License
GENERAL RULE: All things within the commerce of
Positive act of the owner in favor of the holder of
men may be acquired by prescription, unless
the thing (Id.).
otherwise provided (CIVIL CODE, Art. 1113).
Tolerance
NOTE: The objects of possession are things and
Passive acquiescence of the owner to acts being
rights which are susceptible of being appropriated
performed by another which appear to be
under Art. 530 of the Civil Code. Since possession is
 contrary to the rights of the former (Id.).
AGAINST WHOM AGAINST WHOM
PRESCRIPTION RUNS PRESCRIPTION
Tenants cannot acquire tenanted lands by
DOES NOT RUN
prescription, nor can an antichretic creditor the
land of his debtor (Id.). appointed by the courts before their
(CIVIL CODE, Art. 1108). appearance or
2. Public appointed by the
When the acts of enjoyment are executed in such courts (CIVIL CODE,
a manner as to be manifest or visible to all, Art. 1108).
especially to the person against whom the
possession is being adversely asserted (Id.). Persons living abroad, Persons living abroad,
who have managers or who do not have
In order for possession to be public, it must be administrators (CIVIL managers or
known to the owner of the thing (Id.). CODE, Art. 1108). administrators (CIVIL
CODE, Art. 1108).
3. Peaceful
It is acquired and maintained without any Juridical persons State and its
violence, physical, or moral (Id.). (including the State but subdivisions (only with
only with regard to regard to properties of
The possession continues to be peaceful even if patrimonial property) public dominion)
the possessor should use such force as is (CIVIL CODE, Art. 1108). (CIVIL CODE, Art.
reasonably necessary to repel or prevent an 1108).
actual or physical invasion of the property (Id.).
Married woman (CIVIL Between husband and
CODE, Art. 1110). wife during the
4. Uninterrupted marriage even though
When the possessor has never ceased to there be a separation
manifest with external acts his intention to of property agreed
exercise a right over the thing, which upon in the marriage
presupposes that he has never in fact ceased to settlements or by
exercise the right (Id.). judicial decree (CIVIL
CODE, Art. 1109).
Continuity is not understood in an absolute
sense. Possession is uninterrupted if there have - Between parents and
been no acts of deprivation of enjoyment of the children during the
things by a third person, or any other act which minority or insanity of
interrupts prescription (Id.). the latter (CIVIL
CODE, Art. 1109).
Interruption is distinct from discontinuity; the
former is a positive act of third person, while the - Between guardian
latter is a negative act or abstention on the part and ward during the
of the possessor himself (Id.). continuance of the
guardianship (CIVIL
AGAINST WHOM AGAINST WHOM CODE, Art. 1109).
PRESCRIPTION RUNS PRESCRIPTION - In favor of a co-owner
DOES NOT RUN or co-heir against his
Minors and other Minors and other co-owners or co-heirs
incapacitated persons incapacitated persons as long as the co-
who have parents, who do not have ownership is
guardians, or other legal parents, guardians, or recognized (CIVIL
representatives (CIVIL other legal CODE, Art. 494,
CODE, Art. 1108). representatives Par.5).
(CIVIL CODE, Art.
1108). NOTE: Under the Constitution, an alien cannot
acquire any land in the Philippines even by
Absentees who have Absentees who do prescription (CONST, Art. XII, Sec. 3, Par. 1, and
administrators, either not have Sec.7).
appointed by them before administrators, either
their appearance or appointed by them
Prescription Does Not Run Against the State and
Its Subdivisions Regardless of the Nature of the
Government Property (whether Real or Personal)
Article 1108 (4) of the Civil Code expressly provides
that prescription does not run against the State and
its subdivisions. This rule has been consistently
adhered to in a long line of cases involving reversion
of public lands, where it is often repeated that when
the government is the real party in interest, and it is
proceeding mainly to assert its own right to recover
its own property, there can, as a rule, be no defense
grounded on laches or prescription. We find that this
rule applies, regardless of the nature of the
government property. Article 1108 (4) does not
distinguish between real or personal properties of the
State (Ramsical Jr. v. Commission on Audit, G.R. No.
213716, October 10, 2017).
The rule that prescription does not run against the
State does not apply to corporations created by the
State for special purposes, it being said that when the
title of the Republic has been divested, its grantees,
although artificial bodies of its own creation, are in the
same category as ordinary persons (Shipside Inc. v.
CA, G.R. No. 143377, February 20, 2001).
RENUNCIATION OF PRESCRIPTION
ALREADY ACQUIRED:
Persons with capacity to alienate property may
renounce prescription already obtained, but not the
right to prescribe in the future (CIVIL CODE, Art.
1112, Par. 1).
Prescription is deemed to have been tacitly
renounced when the renunciation results from acts
which imply the abandonment of the right acquired
(CIVIL CODE, Art. 1112, Par. 2).
Requisites (C-PORK):
1. The person renouncing must have Capacity to
alienate property;
REASON: Renunciation involves the disposition
of property;
2. The renunciation must refer to Prescription
already obtained;
REASON: Art. 6 of the Civil Code (rights may be
waived) but not the right to prescribe in the future
because it is contrary to public order or public
policy;
3. It must be made by the Owner of the right;
REASON: An administrator, executor, agent, etc.
cannot renounce unless given Special Power of
Attorney (DE LEON, Property, supra at 736).
4. It must not prejudice the Rights of creditors (while
rights may be waived, it must not be prejudicial to
the rights of a third person with a right recognized
by law (CIVIL CODE, Art. 6); and
5. The person renouncing must have Knowledge of
the existence of the right (DE LEON, Property,
supra at 736-737).
Kinds:
1. Express; and
2. Implied/Tacit
– when renunciation results from acts which
imply the abandonment of the right acquired (Id.).
Where the party acknowledges the correctness of the
debt and promises to pay it after the same has
prescribed and with full knowledge of the prescription,
he thereby waives the benefit of prescription
(Development Bank of the Philippines v. Adil, G.R. L-
48889, May 11, 1989).
NOTE: But a simple promise which contains new and
positive promise to pay the debt which has
prescribed, such as a promise to pay only one-half or
even a part payment, does not amount to a
renunciation of prescription (DE LEON, Property,
supra at 737).
Advance Renunciation is Void
A renunciation of prescription in advance is void. An
agreement that the obligation arising from the
contract shall not be subject to prescription is not
binding (Id. at 736).
Renunciations by Representatives
Only persons with capacity to alienate property can
renounce prescription already obtained, not
guardians, executors, administrators (Id.).
Effect of Renunciation to Creditors
Notwithstanding the express or tacit renunciation by
a person of a prescription already obtained, his
creditors and all other persons interested in making
the prescription effective, may still plead prescription
for themselves to the extent of their credit (CIVIL
CODE, Art. 1114).
INTERRUPTION OF POSSESSION (CIVIL
CODE, Arts. 1120 to 1124)
Possession is interrupted for the purposes of
prescription, naturally or civilly (CIVIL CODE, Art.
1120).
KINDS OF INTERRUPTION OF
POSSESSION:
1. Natural
– Possession is naturally interrupted when
through any cause it should cease for more than
one year (CIVIL CODE, Art. 1121).
NOTE: In case of natural interruption, the old
possession loses all its juridical effects, and even
if the possession if reacquired, the old
possession cannot be tacked to the new
possession for the purpose of prescription (DE
LEON, Property, supra at 746-747).
2. Civil
– Civil interruption is produced by judicial
summons to the possessor (CIVIL CODE, Art.
1123).
NOTE: In the case of civil interruption, there is
unanimity between the law and the
commentators in the view that if the possession
is recovered, it can be connected to the time that
has elapsed as if it were in fact continuous, the
period of interruption is to be counted for the
prescription (DE LEON, Property, supra at 746-
747).
When judicial summons does not constitute
interruption:
a. If it should be void for lack of legal
solemnities;
b. If the plaintiff should desist from the
complaint or should allow the proceedings
to lapse; or
c. If the possessor should be absolved from
the complaint (CIVIL CODE, Art. 1124).
EFFECT OF INTERRUPTION
All the benefits acquired so far from the possession
cease. When the prescription runs again, it will be an
entirely new one (DE LEON, Property, supra at 746-
747).
DISTINGUISH PRESCRIPTION FROM
SUSPENSION
If prescription is merely suspended, (as
distinguished from interruption), the old possession
will be added. This may happen when during war, the
civil courts are not open (CIVIL CODE, Art. 1136) or
when there is a moratorium on the payment of debts
(Talens. v. Chuakay and Co., G.R. No. L-10127, June
30, 1958).
Possession de facto – lost if new possession of
another has lasted longer than 1 year.
Real right of possession – not lost until after the
lapse of 10 years.
RECOGNITION BY THE POSSESSOR
Rule: Any express or implied recognition or
acknowledgment which the possessor may make
with regard to the right of owner will also interrupt the
continuity of possession (CIVIL CODE, Art. 1125).
Requisites: (PT-VaB)
1. Recognition must be made by the Possessor
himself, or if made by a Third person, the
recognition must be authorized or ratified by the
possessor;
2. Recognition must be Valid and efficacious in law;
and
NOTE: When the act of recognition was obtained
through violence, intimidation, fraud, or any other
cause which vitiates consent, it will not interrupt
possession.
3. Recognition must have been made Before
prescription has already been obtained (DE
LEON, Property, supra at 747).
PRESCRIPTION OF ACTION
Concept: Prescription of action/limitation of action is
the time within which an action may be brought or
some act done to preserve the right (Id. at 761).
Legal and not natural cause of the extinguishment of
obligations (Id.).
STATUTES OF LIMITATIONS
Acts limiting the time within which actions shall be
brought. Statutes of limitation do not confer any right
of action, but are enacted to restrict the period within
which the right, otherwise limited, might be asserted
(Id.).
STATUTES OF REPOSE
The object of which is to suppress fraudulent and
stale claims from springing up at great distances of
time and surprising the parties of their
representatives when all the proper vouchers and
pieces of evidence are lost or the facts have become
obscure from the lapse of time of the defective
memory of death or removal of witnesses.
Not substantive right but only a matter of defense
(Id.).
PURPOSE: To protect the diligent and vigilant, not
those who sleep on their rights (Tagarao v. Garcia, G.
R. No. L-40064, December 4, 1934).
EFFECT OF LAPSE OF TIME
Actions prescribe by the mere lapse of time fixed by
law (CIVIL CODE, Art. 1139). It extinguishes the
action.
But there is no extinctive prescription unless the
period provided by law expires.
Mere delay in the enforcement of a claim does not
result in any reduction or loss of right, unless the full
period required by law for prescription has expired.
PRESCRIPTION TO BE PLEADED
Obligation subsists until he avails himself of
prescription, the courts of justice cannot supply the
defense if the debtor himself does not do so.
Right to prescription may be waived or renounced. It
is deemed waived if not timely raised or pleaded
before or during the hearing of the case.
It has been held that even if not pleaded, if it is
apparent on the face of the complaint, it may be
favorably considered, even after evidence is
adduced.
PERIOD OF PRESCRIPTION
MOVABLES IMMOVABLES
Good Faith
Four (4) years (CIVIL
Ten (10) years (CIVIL
CODE, Art. 1132, Par.
CODE, Art.1134).
1).
Bad Faith
Eight (8) years (CIVIL
Thirty (30) years (CIVIL
CODE, Art. 1132,
CODE, Art. 1137).
Par.2).
RULES ON COMPUTATION OF PERIOD:
1. The present possessor may complete the period
necessary for prescription by tacking his
possession to that of his grantor or predecessor;
NOTE: However, tacking of possession is
allowed only when there is a privity of contract
or relationship between the previous and
present possessors. In the absence of such
privity, the possession of the new occupant
should be counted only from the time it actually
began and cannot be lengthened by connecting
it with the possession of the former possessors
(South City Homes v. Republic of the Philippines,
G.R.76564, May 25, 1990).
2. It is presumed that the present possessor who
was also the possessor at a previous time, has
continued to be in possession during the
intervening time, unless there is proof to the
contrary; and
3. The first day shall be excluded and the last day
included (CIVIL CODE, Art. 1138).
Computation of Period in Case Possession
Begins in Good Faith but is Later Converted to
Bad Faith
The prescription will be extraordinary but the
possession in good faith shall be computed in the
proportion that the period of extraordinary
prescription bears to that of ordinary prescription (DE
LEON, Property, supra at 758).
Illustration: If the possessor had possessed a
movable for three years in good faith, before his
possession was converted into bad faith, the 3 years
will be computed as double (6 years).
RIGHTS NOT EXTINGUISHED BY
PRESCRIPTION: (RAPE-IT-RIPS)
1. To demand a Right of way;
2. To bring an Action to abate a public of private
nuisance;
3. To demand Partition of co-ownership;
4. To demand Easement of light and view through
observance by servient owner of distances for
direct or oblique view;
5. To declare the Inexistence of contract or the
nullity of a void judgment;
6. To compel a Trustee to reconvey property
registered in his name for the benefit of the cestui
que trust; and
7. To compel Reconveyance of land registered in
bad faith provided it has not yet passed to an
innocent purchaser for value;
NOTE: An action for reconveyance can be barred
by prescription (DBT Mar-Bay Construction Inc.
v. Panes, G.R. No. 167232, July 31, 2009).
The prescriptive period applies only if there is an
actual need to reconvey the property as when the
plaintiff is not in possession of the property. If the
plaintiff, as the real owner of the property also
remains in possession of the property, the
prescriptive period to recover title and
possession of the property does not run against
him. In such a case, an action for reconveyance,
if nonetheless filed, should be in the nature of a
suit for quieting of title, an action that is
imprescriptible (Estate of Deceased Spouses
Francia v. Tan, G.R. No. 225687 (Notice),
November 21, 2018).
When the action for reconveyance is based on a
void deed or contract, the action is imprescriptible
under Article 1410 of the New Civil Code. As long
as the land wrongfully registered under the
 Torrens system is still in the name of the person
PRESCRIPTION PERIODS
who caused such registration, an action in
personam will lie to compel him to reconvey the ACTIONS MOVABLE IMMOVABLE
property to the real owner (Spouses Yu Hwa Ping
v. Ayala Land, Inc., G.R. No. 173120, July 26, on the birth,
2017). appearance or
adoption of a
8. To seek Issuance of a writ of possession; child (CIVIL
9. To Probate a will; and CODE, Art. 763);
10. Recovery by the State of non-registrable land 4. Revoke donation
(DE LEON, Property, supra at 767-768). based on non-
compliance with a
SUMMARY OF PRESCRIPTIVE PERIODS condition (CIVIL
CODE, Art. 764);
PRESCRIPTION PERIODS 5. Rescission of
ACTIONS MOVABLE IMMOVABLE contracts (CIVIL
CODE, Art. 1389,
Action to recover 8 years 30 years Par. 1); and
(CIVIL CODE, Art. from the 6. Annul a contract
1140 and 1141). time (CIVIL CODE,
possession Art. 1391, Par. 1).
is lost.
1. Forcible entry and 1 year
Foreclosure of 10 years detainer (CIVIL
Mortgage (CIVIL CODE, Art.
CODE, Art. 1142). 1147);
2. Defamation
All other actions Within 5 years from the time (CIVIL CODE,
whose periods are the right of action accrues. Art. 1147);
not fixed in the Code 3. Recover
(CIVIL CODE, Art. possession de
1149). facto (CIVIL
CODE, Art.
1. Upon a written 10 years from the time the 1147);
contract; right of action accrues. 4. Revoke a
2. Upon an donation on the
obligation created ground of
by law; and ingratitude (CIVIL
3. Upon a judgment CODE, Art. 769);
(CIVIL CODE, 5. Rescind or
Art. 1144). recover damages
if immovable is
1. Upon an oral 6 years sold with non-
contract; and apparent burden
2. Upon a quasi- or servitude
contract (CIVIL (CIVIL CODE,
CODE, Art. Art. 1560); and
1145). 6. Enforce warranty
1. Upon an injury to 4 years of solvency in
the rights of the assignment of
plaintiff (CIVIL credits (CIVIL
CODE, Art.
CODE, Art.
1146); 1629).
2. Upon a quasi-
delict (CIVIL ACCRUAL OF CAUSE OF ACTION
CODE, Art. Cause of action arises when that which should have
1146); been done is not done or that which should not have
3. Revoke or reduce been done is done (DE LEON, Property, supra at
donation based 762).
 RECKONING POINT
ESSENTIAL ELEMENTS OF A GOOD OF COMPUTATION OF
CAUSE OF ACTION: ACTION PERIOD OF
1. Existence of legal right a plaintiff; PRESCRIPTION
2. With a corresponding legal duty in the
defendant; and From the date when said
3. Violation or breach of that right or duty with Action arising from result was recognized by
consequential injury or damage to the plaintiff, for the result of the agreement of the
which he may maintain an action for appropriate accounting interested parties (CIVIL
relief (China Banking Corporation v. CA, G.R. CODE, Art. 1154).
153267, June 23, 2005).
INTERRUPTION OF PRESCRIPTION OF
NOTE: The moment the breach of right or duty
ACTIONS:
occurs, then the right of action accrues, therefore,
period of prescription begins to run (Solid Homes Inc. 1. Filing of an action in court (DE LEON,
v. Tan, G.R. Nos. 145156-57, July 29, 2005). Property, supra at 783).

RIGHT OF ACTION DISTINGUISHED NOTE: Interrupts extinctive prescription as to the

parties-defendants therein (Id.).
FROM CAUSE OF ACTION
The former is the right to commence and maintain an Filing of a motion for reconsideration continues
action. It springs from the cause of action, but does the suspension of the running of prescription
not accrue until all facts which constitute the cause period, which runs again after the court
have occurred (Multi-Realty v. Makati Tuscany, G.R. proceedings have finally been terminated
No. 146726, June 16, 2006). (Caniza v. People, G.R. No. L-53776, March 18,
1988).
DIFFERENT KINDS OF ACTION AND
CORRESPONDING RECKONING POINT When the prescription is interrupted by a judicial
OF COMPUTATION demand, the full period for the prescription must
be reckoned from the cessation of the
OF PRESCRIPTION PERIOD interruption (Permanent Savings and Loan Bank
RECKONING POINT v. Velarde, G.R. No. 140608, September 23,
OF COMPUTATION OF 2004).
ACTION PERIOD OF
PRESCRIPTION 2. Written extrajudicial demand by the
creditor
When there is no From the day they may The demand must be in writing and made before
special provision be brought (CIVIL the expiration of the period fixed by law (DE
which ordains the CODE, Art. 1150). LEON, Property, supra at 784).
time for prescription
for all kinds of action
Petitioner's action for collection of a sum of
Actions which have From the last payment of money was based on a written contract and
for their object the the annuity or of the prescribes after ten years from the time its right
enforcement of interest (CIVIL CODE, of action arose. The prescriptive period is
obligations to pay Art. 1151). interrupted when there is a written extrajudicial
principal with demand by the creditors. The interruption of the
interest or annuity prescriptive period by written extrajudicial
demand means that the said period would
Actions to demand From the time judgment commence anew from the receipt of the demand.
fulfillment of became final (CIVIL A written extrajudicial demand wipes out the
obligations declared CODE, Art. 1152). period that has already elapsed and starts anew
by a judgment the prescriptive period (Permanent Savings and
Loan Bank v. Velarde, G.R. No. 140608,
From the day the September 23, 2004).
persons who should
Actions to demand
render the same cease
accounting
in their functions (CIVIL
CODE, Art. 1153).
3. Written acknowledgment of the debt by
the debtor
NOTE: In extinctive prescription, the interruption
through the acknowledgment of debt of the
creditor’s right can only take place when such
acknowledgment is in writing (DE LEON,
Property, supra at 784).
It can be implied therefrom, but it must be in
writing. If not coupled with a communication
signed by the payor, would not interrupt the
running of the period of prescription (PNB v.
Osete, G.R. No. L-24997, July 18, 1968).
The acknowledgment must be such as to apply
to a particular and specific debt to interrupt
prescription (DE LEON, Property, supra at 782-
785).
Acknowledgement can be made by a legal
representative (Id.).
The acknowledgment of debt before period of
prescription will interrupt the expiration of the
period of prescription, but a mere
acknowledgment of the obligation after it has
already prescribed is not sufficient to renew the
period of prescription (Id.).
THE
CONDOMINIUM ACT
(R.A. NO. 4726)
CONDOMINIUM
An interest in real property consisting of a separate
interest in a unit in a residential, industrial, or
commercial building and an undivided interest in
common, directly or indirectly, in the land on which it
is located and in other common areas of the building
(R.A. No. 4726, Sec. 2).
UNIT
A part of the condominium project intended for any
type of independent use or ownership, including one
or more rooms or spaces located in one or more
floors (or part/s of floors) in a building or buildings and
such accessories as may be appended thereto (R.A.
No. 4726, Sec. 3).
PROJECT
The entire parcel of real property divided or to be
divided in condominiums, including all structures
thereon (R.A. 4726, Sec.3(c)).

If the period has already expired, there must be a CONDOMINIUM CORPORATION

renunciation of the prescription already acquired,
A corporation which holds title to the common areas,
in order action may be acquired (Id.).
including the land, or the appurtenant interests in
such areas, in which the holders of separate interest
Mere acknowledgment of debt does not
shall automatically be members or shareholders, to
constitute renunciation of prescription already
the exclusion of others, in proportion to the
acquired (Id.).
appurtenant interest of their respective units in the
common areas (R.A. No. 4726, Sec. 2).
By acknowledgment of debt, the debtor may
renew the obligation and interrupt the
NOTE: Any transfer or conveyance of a unit or an
prescription so as to make it run only from the
apartment, office or store, or other space therein,
date of the acknowledgment (Id.).
shall include transfer or conveyance of the undivided
interest in the common areas or, in a proper case, the
A mere offer to compromise a suit upon a
membership or shareholdings in the condominium
supposed debt is not an admission that anything
corporation: Provided, however, that where the
is due and cannot be used as evidence against
common areas in the condominium project are held
the defendant (Lichauco v. Limjuco, G.R. No.
by the owners of separate units as co–owners
6189, March 11, 1911).
thereof, no condominium unit therein shall be
conveyed or transferred to persons other than Filipino
This simply means that the period of prescription,
citizens or corporations at least 60% of the capital
when interrupted by such a written
stock of which belong to Filipino citizens, except in
acknowledgment, begins to run anew; and
cases of hereditary succession (R.A. No. 4726, Sec.
whatever time of limitation might have already
5).
elapsed from the accrual of the cause of action is
thereby negated and rendered inefficacious
Ownership over a condominium unit is acquired by
(Philippine National Railways v. NLRC, G.R.
the buyer only after he had fully paid the purchase
81231, September 19, 1989).
price (Sunset View Condominium Corp. v. Campos,
Jr., G.R. No. L-52361, April 27, 1981).
DOCUMENTS TO CONSIDER:
1. Enabling or Master Deed
– Which shall contain, among others, the
following:
a. Description of the land on which the building
or buildings and improvements are or are to
be located;
b. Description of the building or buildings,
stating the number of stories and basements,
the number of units and their accessories, if
any;
c. Description of the common areas and
facilities;
d. A statement of the exact nature of the interest
acquired or to be acquired by the purchaser
in the separate units and in the common
areas of the condominium project. Where title
to or the appurtenant interests in the common
areas is or is to be held by a condominium
corporation, a statement to this effect shall be
included;
e. Statement of the purposes for which the
building or buildings and each of the units are
intended or restricted as to use;
f. A certificate of the registered owner of the
property, if he is other than those executing
the master deed, as well as of all registered
holders of any lien or encumbrance on the
property, that they consent to the registration
of the deed;
g. The following plans shall be appended to the
deed as integral parts thereof:
i. A survey plan of the land included in the
project, unless a survey plan of the same
property had previously been filed in said
office; and
ii. A diagrammatic floor plan of the building
or buildings in the project, in sufficient
detail to identify each unit, its relative
location and approximate dimensions;
h. Any reasonable restriction not contrary to
law, morals or public policy regarding the
right of any condominium owner to alienate
or dispose of his condominium (R.A. No.
4726, Sec. 4).
2. Declaration of Restrictions (R.A. No. 4726,
Sec. 6); and
3. Articles and By-Laws of the
Condominium Corporation or the
association where applicable.
RIGHTS AND OBLIGATIONS OF
CONDOMINIUM OWNERS/INCIDENTS OF
A CONDOMINIUM GRANT
1. The boundary of the unit granted are the interior
surfaces of the perimeter walls, floors, ceilings,
windows, and doors thereof;
2. There shall pass with the unit, as an
appurtenance thereof, an exclusive easement for
the use of the air space encompassed by the
boundaries of the unit as it exists at any particular
time and as the unit may lawfully be altered or
reconstructed from time to time. Such easement
shall be automatically terminated in any air space
upon destruction of the unit as to render it
untenantable;
3. Unless otherwise, provided, the common areas
are held in common by the holders of units, in
equal shares, one for each unit;
4. A non-exclusive easement for ingress, egress
and support through the common areas is
appurtenant to each unit and the common areas
are subject to such easements;
5. Each condominium owner shall have the
exclusive right to paint, repaint, tile, wax, paper
or otherwise refinish and decorate the inner
surfaces of the walls, ceilings, floors, windows
and doors bounding his own unit;
6. Each condominium owner shall have the
exclusive right to mortgage, pledge, or encumber
his condominium and to have the same
appraised independently of the other
condominiums but any obligation incurred by
such condominium owner is personal to him; and
7. Each condominium owner has also the absolute
right to sell or dispose of his condominium unless
the master deed contains a requirement that the
property be first offered to the condominium
owners within a reasonable period of time before
the same is offered to outside parties (R.A. No.
4726, Sec. 6).
COMMON AREAS
The entire project except all units separately granted
or held or reserved (R.A. No. 4726, Sec. 3).
GENERAL RULE: Common areas shall remain
undivided, and there shall be no judicial partition
thereof (R.A. No. 4726, Sec 7).
EXCEPTIONS/GROUNDS FOR PARTITION:
Where several persons own condominiums in a
condominium project, an action may be brought by
one or more such persons for partition thereof by sale
of the entire project, as if the owners of all of the
condominiums in such project were co-owners of the
entire project in the same proportion as their interests
in the common areas (R.A. No. 4726, Sec. 8) in the
following cases:
1. That three years after damage or destruction
to the project which renders material part thereof
unfit for its use prior thereto, the project has not
been rebuilt or repaired substantially to its state
prior to its damage or destruction;
2. That damage or destruction to the project has
rendered one-half or more of the units therein
untenantable and that condominium owners
 holding in aggregate more than thirty percent
(30%) interest in the common areas are
opposed to repair or restoration of the project;
3. That the project has been in existence in excess
of fifty (50) years, that it is obsolete and
uneconomic, and that condominium owners
holding in aggregate more than fifty percent
(50%) interest in the common areas are
opposed to repair or restoration or remodeling or
modernizing of the project;
4. That the project or a material part thereof has
been condemned or expropriated and that the
project is no longer viable, or that the
condominium owners holding in aggregate more
than seventy percent (70%) interest in the
common areas are opposed to continuation of
the condominium regime after expropriation or
condemnation of a material portion thereof; or
NOTE: If the Court finds that the conditions
provided for in this Act or in the declaration of
restrictions have not been met, the Court may
decree a reorganization of the project, declaring
which portion or portions of the project shall
continue as a condominium project, the owners,
and the respective rights of said remaining
owners and just compensation, if any, that a
condominium owner may be entitled to due to
deprivation of his property (R.A. No. 4726, Sec.
23).
5. That the conditions for such partition by sale set
forth in the declaration of restrictions, duly
registered in accordance with the terms of this
Act, have been met (R.A. No. 4726, Sec. 8 (e)).
The owner of a project shall, prior to the
conveyance of any condominium therein, register
a declaration of restrictions relating to such
project, which restrictions shall constitute a lien
upon each condominium in the project, and shall
insure to and bind all condominium owners in the
project. Such liens, unless otherwise provided,
may be enforced by any condominium owner in
the project or by the management body of such
project (R.A. No. 4726, Sec. 9).
CONDOMINIUM CORPORATION
Whenever the common areas in a condominium
project are held by a condominium corporation, such
corporation shall constitute the management body
of the project.
The corporate purposes of such a corporation shall
be limited to the holding of the common areas, either
in ownership or any other interest in real property
recognized by law, to the management of the project,
and to such other purposes as may be necessary,
incidental or convenient to the accomplishment of
said purposes.
Membership in a condominium corporation,
regardless of whether it is a stock or non-stock
corporation, shall not be transferable separately from
the condominium unit of which it is an appurtenance.
When a member or stockholder ceases to own a unit
in the project in which the condominium corporation
owns or holds the common areas, he shall
automatically cease to be a member or stockholder
of the condominium corporation (R.A. No. 4726, Sec.
10).
The term of a condominium corporation shall be co-
terminus with the duration of the condominium
project, the provisions of the Corporation Law to the
contrary notwithstanding (R.A. No. 4726, Sec. 11).
In case of involuntary dissolution of a condominium
corporation for any of the causes provided by law, the
common areas owned or held by the corporation
shall, by way of liquidation, be transferred pro-indiviso
and in proportion to their interest in the corporation to
the members or stockholders thereof, subject to the
superior rights of the corporation creditors.
Such transfer or conveyance shall be deemed to be
a full liquidation of the interest of such members or
stockholders in the corporation.
After such transfer or conveyance, the provisions of
this Act governing undivided co-ownership of, or
undivided interest in, the common areas in
condominium projects shall fully apply (R.A. No.
4726, Sec. 12).
Until the enabling or the master deed of the project in
which the condominium corporation owns or holds
the common area is revoked, the corporation shall not
be voluntarily dissolved through an action for
dissolution under Rule 104 of the Rules of Court
except upon a showing of the conditions provided in
Sec. 8 of R.A. 4726 (R.A. No. 4726, Sec. 13).
The condominium corporation may also be dissolved
by the affirmative vote of all the stockholders or
members thereof at a general or special meeting duly
called for the purpose; Provided, that all the
requirements of Section sixty-two of the Corporation
Law are complied with (R.A. No. 4726, Sec. 14).
The corporation shall be deemed to hold a power of
attorney from all the members or stockholders to sell
and dispose of their separate interests in the project
and liquidation of the corporation shall be effected by
a sale of the entire project as if the corporation owned
the whole thereof, subject to the rights of the
corporate and of individual condominium creditors,
unless otherwise provided for in the declaration of
restrictions upon voluntary dissolution of a
condominium corporation (R.A. No. 4726, Sec. 15).
A condominium corporation shall not, during its
existence, sell, exchange, lease, or otherwise
dispose of the common areas owned or held by it in
the condominium project unless authorized by the
affirmative vote of all the stockholders or members
(R.A. 4726, Sec. 16).

The management body, unless otherwise

provided for by the declaration of restrictions,
may acquire and hold, for the benefit of the
condominium owners, tangible and intangible
personal property and may dispose of the same
by sale or otherwise; the beneficial interest in
such personal property shall be owned by the
condominium owners in the same proportion as
their respective interests in the common areas. A
transfer of a condominium shall transfer to the
transferee ownership of the transferor's
beneficial interest in such personal property (R.A.
No. 4726, Sec. 22).
 3. Eclectic Theory
SUCCESSION This theory tries to harmonize the two principles
– individual and social. In either of these
principles, the basis of succession is the
recognized necessity of perpetuating man’s
GENERAL PROVISIONS patrimony beyond the limits of human existence
(Id. at 2-3).
(ARTS. 774-782)
SUCCESSION V. INHERITANCE
SUCCESSION INHERITANCE
SUCCESSION Refers to the legal Refers to the
A mode of acquisition by virtue of which the property, mode by which universality of all the
rights and obligations to the extent of the value of the inheritance is property, rights and
inheritance, of a person are transmitted through his transmitted to the obligations of a
death to another or others either by his will or by persons entitled to it decedent, which are not
operation of law (CIVIL CODE, Art. 774). (CIVIL CODE, Art. 774). extinguished by his
death (CIVIL CODE,
BASES OF SUCCESSION: Art. 776).
1. Right to dispose Private Property
If man has the right to own private property, he NOTE: Inheritance is
has the power to dispose of such property freely, the objective element of
imposing such licit terms and conditions as he succession. (JURADO,
may deem convenient. Consequently, he may Succession, supra at 5).
distribute them by means of a testament, since
a testament is nothing more than an instrument KINDS OF SUCCESSION:
of alienation conditioned upon his death
(JURADO, Comments and Jurisprudence on 1. As to whether a will exists or not:
Succession, (2009), p. 2 [hereinafter, JURADO, a. Testamentary or Testacy – by a will
Succession]). executed in the form prescribed by law
(CIVIL CODE, Art. 779);
NOTE: This is the basis of testamentary b. Legal or Intestacy – by operation of law
succession. based on the decedent’s presumed will
(CIVIL CODE, Art. 960); and
c. Mixed – partly testamentary and partly legal
2. Family Co-ownership
(CIVIL CODE, Art.780).
If the family is recognized as the heart and soul
of society, the idea of succession must,
therefore, revolve around it. Hence, the basis of 2. As to effectivity:
succession rests upon family co-ownership (Id.). a. Inter vivos – takes effect during the lifetime
of the source of the property (e.g., donation)
NOTE: This is the basis of intestate succession. b. Mortis causa – takes effect after the death
of the source of the property

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA TAMPUS, Vice Chairperson
for Secretariat | ARVY KEITH CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice Chairperson for
Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. JOSEPH FERDINAND DECHAVEZ

3. As to extent:
a. Universal – covers all the property, rights,
and obligations of the decedent, that is all the
relations in which the decedent was involved
b. Particular – limited to certain specific items
4. As to part of property transmitted:
a. Forced or compulsory – takes place with
respect to the legitime
b. Voluntary – takes place with respect to the
free portion
5. Contractual
– deducible from the provision of Art. 130 of the
Civil Code which is contractual in character and
applicable only to donations of future property by
reason of marriage made by one spouse to the
other (JURADO, Succession, supra at 14; DE
LEON, Comments and Cases on Succession,
(2017), p. 34-35 [hereinafter, DE LEON,
Succession]).
REQUISITES FOR TRANSMISSION OF
SUCCESSIONAL RIGHTS: (DAT)
1. That indeed there has been Death (actual or
presumed);
2. That the rights or properties are indeed
Transmissible or discernible; and
3. That the transferee is still Alive (no predecease),
is willing (no repudiation), and is capacitated to
inherit (3 PARAS, Civil Code of the Philippines
Annotated, (2016), p. 12-13) [hereinafter, 3
PARAS].
ELEMENTS:
1. Subjective Elements: Decedent and
Successors
a. Decedent
The person whose property is transmitted
through succession, whether or not he left a
will (CIVIL CODE, Art. 775):
i. Testator – if he left a will.
ii. Decedent – if he left no will.
b. Successors (Transferees or Causa
habientes)
i. Heirs – Those who are called to the
whole or to an aliquot portion of the
inheritance either by will or by operation
of law (CIVIL CODE, Art. 782).
(1) Compulsory/Forced – Those who
succeed by force of law to some
portion of the inheritance in an
amount predetermined by law known
as legitime (CIVIL CODE, Art. 886).
(2) Voluntary – Those who succeed by
virtue of the will of the testator, to the
whole or aliquot part of the
disposable free portion of the
hereditary estate. They exist only in
testamentary succession (JURADO,
Succession, supra at 185); and
NOTE: A person may be a compulsory
and voluntary heir at the same time, in
the same will (dual status as an heir).
This happens when in a will, a
compulsory heir is given more than his
legitime. Insofar as his legitime is
concerned, he is a compulsory heir.
Insofar as the excess is concerned, he
is a voluntary heir (3 PARAS, supra at
35).
(3) Legal/Intestate – Those who
succeed by operation of law when
legal or intestate succession takes
place. They are classified as:
(a) Those who inherit in their own
right; and
(b) Those who inherit by right of
representation.
ii. Devisees – persons to whom gifts of real
property are given by virtue of a will (CIVIL
CODE, Art. 782).
iii. Legatees – persons to whom gifts of
personal property are given by virtue of a will
(CIVIL CODE, Art. 782).
HEIRS V. DEVISEES OR LEGATEES,
DISTINGUISHED
HEIRS DEVISEES OR
LEGATEES
As to Title
Universal title; Particular title;
Succeed to an Succeed to individual
indeterminate or aliquot items of property.
portion.
As to Means of Succession
Succeed by means of a Succeed by means of a
will or by operation of will only (CIVIL CODE,
law (CIVIL CODE, Art. Art. 782).
782).
As to Portion of Estate
Distinction must be As a rule, the devises or
made between heirs in legacies are chargeable
testate succession against the free portion.
(compulsory and
voluntary) and heirs in
intestate succession
(legal or intestate heirs)
 HEIRS DEVISEES OR VOLUNTARY DEVISEES
LEGATEES HEIRS /LEGATEES

to determine the portion prejudiced (CIVIL

of the estate. CODE, Art. 918).

As to Extent of Inheritance As to Properties Acquired by Testator After

Execution of The Will
Inherits an aliquot part Must be specified by the
of the indeterminate testator. Inherit everything at the After-acquired
portion of the estate. time of the testator’s properties shall only
death (JURADO, pass thereby, as if the
As to Representation of Decedent’s Juridical Succession, supra at testator had possessed
Person 36). it at the time of the
making of the will,
Represents the juridical Does not represent the
should it expressly
personality of the personality of the
appear by the will that
deceased and acquires deceased regardless of
such was his intention.
his rights, properties, the quantity or value of
(CIVIL CODE, Art. 793).
and obligations not the devise or legacy.
extinguished by death
REASON: It does not
to the extent of the
apply to the heirs
value of the inheritance.
because the heirs
As to Who May Succeed inherit everything at the
time of the testator’s
The heir who succeeds The devisee or legatee death. The time of death
by operation of law must may be a relative or not. is the determining point
be a relative of the properties, which
the heirs will inherit, not
(JURADO, Succession, supra at 27-28; DE LEON,
the making of the will
Succession, supra at 40-41).
(See CIVIL CODE, Arts.
776 and 781).
NOTE: The distinction between heirs and
devisees/legatees are significant in the following
cases: (PIA) Illustration: X designated A to ½ of his estate. He
a. Preterition (CIVIL CODE, Art. 854); also designated to B his car with plate number GVG-
b. Imperfect disinheritance (CIVIL CODE, Art. 101. Who is the heir? Who is the legatee?
918); and
c. After–acquired properties (CIVIL CODE, Answer: A is an heir because he will succeed to an
Art. 793). undivided portion of the estate (½ of X’s estate). B is
a legatee because he will succeed to a specified
VOLUNTARY HEIRS V. DEVISEES OR property (a car with plate no. GVG-101).
LEGATEES, DISTINGUISHED Illustration: X executed a will in 2008. In his will, X
VOLUNTARY DEVISEES gave Y all of his cars. X died in 2021. At the time of
HEIRS /LEGATEES the execution of the will, X had only 2 cars.
Assuming that in 2021 X already has 20 cars, how
As to Effect of Preterition or Pretermission many cars will Y inherit?
Annul entirely the Valid insofar as they are Answer: Y, a legatee, will only get 2 cars because
institution of heirs not inofficious (CIVIL the remaining cars are after-acquired properties. As
(CIVIL CODE, Art. 854). CODE, Art. 854). a rule, after-acquired properties shall only pass, as if
the testator had possessed at the time of the making
As to Effect of Imperfect or Defective
of the will, should it expressly appear by the will that
Disinheritance
such was his intention. (CIVIL CODE, Art. 793).
Annul the institution of Valid insofar as they are Here, it does not expressly appear that it was X’s
heirs to the extent that not inofficious (CIVIL intention to pass even his after-acquired properties.
the legitime of the CODE, Art. 918). Hence, Y shall only get 2 cars.
disinherited heir is
2. Causal Element: Death
When right to succession is transmitted
The rights to the succession are transmitted
from the moment of the death of the decedent
(CIVIL CODE, Art. 777). This rule applies to the
2 kinds of death:
a. Actual, Physical or Natural; and
b. Presumptive.
NOTE: It is not tradition (delivery) that transfers
ownership, but succession. The effects of the
acceptance of inheritance retroact to the
moment of death (3 PARAS, supra at 16).
Before Death
No heir may enter into a contract with respect to
his future share in the inheritance because at
this point the heirs have only a mere hope or
expectancy, absolutely inchoate in character, to
their share in the inheritance (JURADO,
Succession, supra at 9).
Any contract entered into with respect to future
inheritance would have no object whatsoever,
and as a consequence, would be inexistent from
the beginning (Id.; read in connection with par. 2
of Art. 1347 of the Civil Code).
GENERAL RULE: No contract may be entered
into upon future inheritance except in cases
expressly authorized by law (CIVIL CODE, Art.
1347 par. 2).
EXCEPTIONS:
a. Donations propter nuptias by the future
spouses to each other of future property
(JURADO, Succession, supra at 9); and
b. Partitions inter vivos made by a person of
his estate among his heirs (CIVIL CODE,
Art. 1080).
After Death
After death, the heirs own the property, subject
to the decedent’s liabilities (3 PARAS, supra at
21). Hence, by virtue of their ownership, the
heirs may enter into a contract with respect to
his share in the inheritance even before partition
has been effected (JURADO, Succession, supra
at 8).
By virtue of succession, prior settlement of the
estate is not necessary for any of the heirs to
acquire legal capacity to sue. Heirs can
commence an action originally pertaining to the
decedent (Emnace v. CA, G.R. No. 126334,
November 23, 2001).
The fact that the hereditary estate is placed
under administration will not affect the
application of Art. 777 (JURADO, Succession,
supra at 12). However, an heir cannot compel
the administrator to deliver to him his respective
portion without order of the court (Id. at 13).
No judicial declaration of heirship is necessary
in order that an heir may assert his or her right
to the property of the deceased. Under the Civil
Code and Code of Civil Procedure, the title to
the property owned by a person who dies
intestate passes at once to his heirs. Such
transmission is subject to the claims of
administration and the property may be taken
from the heirs for the purpose of paying debts
and expenses. Without some showing that a
judicial administrator had been appointed in
proceedings to settle the estate, the right of the
heirs to maintain such action is established
(Gloria-Payduan v. Builders Savings and Loan
Association, G.R. No. 202324, June 4, 2018).
Unless there is a pending special proceeding for
the settlement of the decedent's estate or for the
determination of heirship, the compulsory or
intestate heirs may commence an ordinary civil
action to declare the nullity of a deed or
instrument, and for recovery of property, or any
other action in the enforcement of their
ownership rights acquired by virtue of
succession, without the necessity of a prior and
separate judicial declaration of their status as
such. The ruling of the trial court shall only be in
relation to the cause of action of the ordinary civil
action, i.e., the nullification of a deed or
instrument, and recovery or reconveyance of
property, which ruling is binding only between
and among the parties (Reyes v. Larlar, G.R.
No. 232579, September 8, 2020).
Determination of the Time of Death in Case
of Presumptive Death
General Rule: The time when the absentee
actually died must be proved in accordance with
the ordinary rules of evidence (JURADO,
Succession, supra at 11).
Exceptions:
a. Ordinary Absence
For purposes of opening one’s succession,
an absentee is presumed dead at the time
of the expiration of the period of absence
designated by law:
i. 10 years – if he disappeared at the age
of 75 or below.
ii. 5 years – if he disappeared after the age
of 75 (CIVIL CODE, Art. 390, par. 2).
NOTE: The death is presumed to have
occurred at the end of the 10-year or 5-
 year period (JURADO, Succession, supra
at 11).
b. Qualified or Extraordinary Absence
A person shall be presumed dead for all
purposes, including the division of the
estate among the heirs, under the
following circumstances: (VAD)
i. If he is on board a Vessel lost during a
sea voyage, or an aeroplane which is
missing, who has not been heard of for
4 years since the loss of the vessel or
aeroplane;
ii. If he is in the Armed forces who has
taken part in war, and has been missing
for 4 years; or
iii. If he has been in Danger of death under
other circumstances and his existence
has not been known for 4 years (CIVIL
CODE, Art. 391).
NOTE: The person is presumed to have
died at the time of the disappearance, i.e.,
at the time the calamity took place, and not
at the end of four (4) years (JURADO,
Succession, supra at 12).
The succession really took place four years
before (on the day of the disappearance),
but actual division will only be at the end of
four years. In other words, from the
beginning of the said four years, the heir
shall be considered the owner and
possessor of the property, and not only from
the end thereof (3 PARAS, supra at 18).
In both cases, the succession is only of
provisional character because there is
always the chance that the absentee may
still be alive (Id.).
Time of Death of Two or more Persons
who are called to succeed each other
If there is doubt, as between two or more
persons who are called to succeed each
other, as to which of them died first, whoever
alleges the death of one prior to the other
shall prove the same; in the absence of
proof, it is presumed that they died at the
same time and there shall be no
transmission of rights from one to the other
(CIVIL CODE, Art. 43).
Effect of Absentee’s Return or
Appearance
The absentee shall recover his property in
the condition in which it may be found, and
the price of any property that may have been
alienated or the property acquired therewith;
but he cannot claim either fruits or rents.
(CIVIL CODE, Art. 392). If the heir had
already spent the money there is no
obligation to reimburse, in as much as the
consumption had been made in good faith
(3 PARAS, supra at 18-19).
3. Objective Element: Inheritance
Scope of Inheritance:
a. All properties of the decedent existing at the
time of his death to the extent of the value of
the inheritance (CIVIL CODE, Art. 776 and
Art. 1311).
Restricted Concept of Inheritance
Until a final liquidation is made and all debts
left by the decedent are fully paid, the right
of the heirs to inherit remains inchoate or is
a mere hope or expectancy. Liquidation is
necessary to determine whether the
decedent has left assets which may be
transmitted to his heirs (JURADO,
Succession, supra at 5).
NOTE: The mortal remains of the decedent
is not a property, hence, does not form part
of the inheritance. However, under R.A. 349,
as amended by R.A. 1056, a person may
validly grant to a licensed physician,
surgeon, scientist or any medical or
scientific institution, the authority to detach
at any time after his death any organ of his
body (Id. at 17-18).
R.A. No. 7170 authorizes the legacy or
donation of all or part of a human body after
death for specified purposes (DE LEON,
Succession, supra at 10).
b. All transmissible rights and obligations
existing at the time of decedent’s death to
the extent of the value of inheritance (CIVIL
CODE, Art. 776 and Art. 1311).
PATRIMONIAL RIGHTS VS. PURELY
PERSONAL RIGHTS
PATRIMONIAL PURELY PERSONAL
RIGHTS RIGHTS
Relates to
Property Persons and family
Whether Extinguished by Death
GENERAL RULE: Extinguished by death
Not extinguished by because they are
death inseparable from their
holder or owner

PATRIMONIAL PURELY PERSONAL
RIGHTS RIGHTS
EXCEPTION:
Otherwise provided by
law or will
Whether Transmissible
Transmissible. Hence, Intransmissible by their
they may be included in nature and purpose (not
the inheritance. by contract). They are
not included in the
inheritance.
(DE LEON, Succession, supra at 11-13).
Obligations not extinguished by death
which form part of the estate
GENERAL RULE: Obligations are by
nature transmissible and may constitute part
of the inheritance.
EXCEPTIONS:
i. Personal obligations;
ii. Those arising from a contract for a
piece of work; and
iii. Those that are made intransmissible
by express agreement or by will of the
testator or by express provision of law
(Id. at 14).
Rights and Obligations NOT
extinguished by death:
i. Right to bring or continue an action for
forcible entry or unlawful detainer;
ii. Right to compel the execution of a
document necessary for convenience,
provided the contract is valid and
enforceable;
iii. Right to continue a lease contract;
iv. Property right in an insurance policy
with an irrevocable designation (3
PARAS, supra at 7);
v. Civil liability arising from crime;
vi. Obligation to deliver to the vendee
property sold by their parents; and
vii. Rights and obligations arising from
contract or negligence (DE LEON,
Succession, supra at 13-14).
Rights and Obligations extinguished by
death and are not transmissible:
i. Rights and obligations between
husband and wife;
ii. Property relations between husband
and wife;
iii. Action for legal separation or to annul a
marriage;
iv. Action to compel acknowledgment of a
natural child;
v. Action to obtain judicial declaration of
illegitimate filiation of an illegitimate
child who is not natural;
vi. Parental authority or patria potestas;
vii. Rights of a guardian;
viii. Right to receive and the obligation to
give support;
ix. Right to hold a public office as well as
the right to exercise a profession or
vocation;
x. Right of usufruct;
xi. Right of personal easement;
xii. Rights and obligations arising from a
contract of partnership or agency; and
xiii. Criminal responsibility (JURADO,
Succession, supra at 19).
NOTE: The rights and obligations
extinguished by death are not transmissible
by their nature, or by stipulation or by
provision of law (CIVIL CODE, Art. 1311).
The rights and obligations the deceased had
by virtue of the subject Codicil were
transmitted to his forced heirs, at the time of
his death (Rabadilla v. CA, G.R. No.113725,
June 29, 2000).
Section 5 of Rule 86 of the Rules of Court
expressly allows the prosecution of money
claims arising from a contract against the
estate of a deceased debtor. Hence, money
claims are not actually extinguished.
Whatever monetary liabilities or obligations
the deceased had under his contracts with
creditors were not intransmissible by their
nature, by stipulation, or by provision of law.
Hence, his death did not result in the
extinguishment of those obligations or
liabilities, which merely passed on to his
estate (Stronghold Insurance Co., Inc. v.
Republic-Asahi Glass Corp., G.R. No.
147561, June 22, 2006 citing Pavia v. De La
Rosa, G.R. No. L-3083, March 18, 1907).
With respect to obligations arising from
contracts, while the same is transmissible to
the heirs, the latter’s liability shall, however,
be limited only up to the value of the
property they received from the decedent (1
RABUYA, Civil Law Reviewer, (2017), p.
714 [hereinafter 1 RABUYA]).
The right of action for the acknowledgement
of a natural child is extinguished by his
death because no express provision like that
of Art. 118 of the then Civil Code on the
 acknowledgement of legitimate children
exists. As such, the right of action cannot be
transmitted to and enforced by his mother
(Conde v. Abaya, G.R. No. 4275, March 23,
1909).
NOTE: It must be remembered, however,
that the Family Code limits the classification
of children only to legitimate and illegitimate
children (JURADO, Succession, supra at
292).
The action to claim legitimacy for both
legitimate and illegitimate children may be
brought by the child during his/her lifetime
and shall be transmitted to the heirs should
the child die during minority or in a state of
insanity. In these cases, the heirs shall have
a period of five (5) years within which to
institute the action (FAMILY CODE, Art.
173).
c. Those which have accrued thereto since the
opening of the succession; such as alluvium
(CIVIL CODE, Art. 781).
NOTE: The accretions or accessions are not strictly
inherited for they form part of the estate only after
the heirs become the owners thereof; hence,
properly speaking they are acquired by accretion (as
an incident of ownership under the LAW), not by
succession (3 PARAS, supra at 33).
TESTAMENTARY
SUCCESSION
(ARTS. 783-959)
It is one which results from the designation of an heir
made in a will executed in the form prescribed by law
(CIVIL CODE, Art. 779).
WILL
An act whereby a person is permitted, with the
formalities prescribed by law, to control to a certain
degree the disposition of his estate, to take effect
after his death (CIVIL CODE, Art. 783).
The right to make a testamentary disposition of one's
property is purely of statutory creation, and is
available only upon the compliance with the
requirements of the statute. The formalities which
the Legislature has prescribed for the execution of a
will are essential to its validity, and cannot be
disregarded. The mode so prescribed is the
measure for the exercise of the right, and the heir
can be deprived of his inheritance only by a
compliance with this mode (Herreros v. Gil, G.R. No.
L-3362, March 1, 1951).
KINDS:
1. Notarial or Ordinary; and
2. Holographic.
MODES:
1. By will; or
2. By codicil.
CHARACTERISTICS (PFV-DRUM):
1. Strictly Personal Act
It cannot be left in whole or in part to the
discretion of a third person, or accomplished
through the instrumentality of an agent or
attorney (CIVIL CODE, Art. 784).
The mere act of drafting a will does not fall within
the purview of the prohibition because the
person doing the mechanical work of writing the
will is a matter of indifference. Thus, the fact that
the will was typewritten in the office of a lawyer
is of no consequence (Castañeda v. Alemany,
G.R. No. 1439, March 19, 1904).
Acts which may not be left to the discretion
of a third person: (DEPO)
a. Duration of the designation of heirs,
devisees or legatees (CIVIL CODE, Art.
785);
b. Efficacy of the designation of heirs, devisees
or legatees (CIVIL CODE, Art. 785);
c. Determination of the Portions which they are
to take, when referred to by name (CIVIL
CODE, Art. 785); and
REASON: Those acts are testamentary in
character (JURADO, Succession, supra at
31).
d. Determination of whether or not the
testamentary disposition is to be Operative
(CIVIL CODE, Art. 787).
REASON: While the act determining
whether a testamentary disposition is to be
operative or not is not exactly testamentary
in character, it is nonetheless prohibited
because it would be tantamount to allowing
a third person substitute the will of the
testator for his own (JURADO, Succession,
supra at 32).
Illustration: X declared in his will “I hereby
make A, B, and C, children of Hospicio de San
Jose, as my legal heirs and declare my lawyer
 to determine the amount which they are to
receive.” Is the provision valid?
Answer: No. Art. 785 will apply because the
heirs were referred to by name. Furthermore,
the amount was not specified by the testator. It
is the lawyer who determines the amount.
Acts which may be entrusted to a third
person (CIVIL CODE, Art. 786):
a. Distribution of specific property or sums of
money that the decedent may leave in
general to specified classes or causes; and
b. Designation of the persons, institutions or
establishments to which such property or
sums are to be given or applied.
Illustration: What if X declared in his will: “I give
P10 million to the street children of Manila and
hereby designate my lawyer to take care of the
distribution of the said amount.” Is the provision
valid?
Answer: Yes. Art. 786 applies. The beneficiary
is a specified class and the amount was in a
specified amount of money.
2. Formal and Solemn Act
It must be executed in accordance with the
formalities required by law (3 PARAS, supra at
44).
3. Free and Voluntary Act
It must have been executed freely, knowingly, or
ambulatory; otherwise, it will be disallowed (Id.).
4. Disposition of Property
Disposition can be done either:
a. Directly – by the institution of heirs or
designation of devisees or legatees and the
property or share they are to receive; or
b. Indirectly – by validly disinheriting those
who would otherwise inherit by operation of
law (1 RABUYA, supra at 725).
A document which initially comes across as a
mere disinheritance is considered a will. An
intent to dispose mortis causa can be clearly
deduced from the terms of the instrument, and
while it does not make an affirmative disposition
of the testator’s property, the disinheritance of
an heir, nonetheless, is an act of disposition in
itself. The disinheritance results in the
disposition of the property of the testator in favor
of those who would succeed in the absence of
the disinherited heir. (Seangio v. Hon. Reyes,
G.R. Nos. 140371–72, November 27, 2006).
5. Ambulatory and Revocable During the
Testator’s Lifetime
The testator can alter, revise, or revoke it at any
time before his death.
6. Unilateral and Individual Act
– This means that no acceptance by the
transferee is needed while the testator is still
alive; any acceptance made prematurely is
useless (3 PARAS, supra at 44).
Two or more persons cannot make a single joint
will, either for their reciprocal benefit or for
another person. However, separate or
individually executed wills, although containing
reciprocal provisions (mutual wills), are not
prohibited, subject to the rule on disposicion
captatoria (CIVIL CODE, Art. 875).
7. Act Mortis causa
It takes effect only after the death of the testator
(3 PARAS, supra at 44).
INTERPRETATION OF
WILLS
(ARTS. 787-795)
All rules of construction are designed to ascertain
and give effect to the intention of the testator. It is
only when the intention of the testator is contrary to
law, morals, or public policy that it cannot be given
effect (JURADO, Succession, supra at 34).
DISPOSITIONS SUSCEPTIBLE OF
DIFFERENT INTERPRETATIONS
In case of doubt, that interpretation by which the
disposition is to be operative or will sustain and
uphold the will in all its parts shall be adopted,
provided that it can be done consistently with the
established rules of law (CIVIL CODE, Art. 788).
REASON: Testamentary succession is preferred
over intestacy. As much as possible, a testator's will
is treated and interpreted in a way that would render
all of its provisions operative.14 Hence, there is no
basis to apply the provisions on intestacy when
testate succession evidently applies (Hacbang v.
Alo, G.R. No. 191031, October 05, 2015).
RULE ON MISTAKES AND OMISSION
1. When there is an imperfect description or when
no person or property exactly answers the
description, mistakes and omissions must be
corrected by ascertaining the testator’s intention
 using either intrinsic or extrinsic evidence, or
both (JURADO, Succession, supra at 35).
2. When there is uncertainty on the face of the will,
as to the application of any of its provision, the
testator’s intention is to be ascertained from the
words of the will, taking into consideration the
circumstances under which it was made (Id.).
In both instances, the oral declarations of the
testator as to his intentions are to be excluded
(CIVIL CODE, Art. 789).
KINDS OF AMBIGUITIES:
1. Patent or extrinsic ambiguities
– Those which appear on the face of the will
itself.
Example: “I hereby institute some of my seven
(7) brothers…” It is evident that there is an
uncertainty as to how many brothers are being
instituted.
2. Latent or intrinsic ambiguities
– those which do not appear on the face of the
will and are discovered only by extrinsic
evidence.
Example: “I institute my brother-in-law…” It was
discovered that there are two (2) brothers-in-law
(3 PARAS, supra at 49-50).
WHEN AMBIGUITY ARISES
1. When there is an imperfect description of the
heir, legatee, or devisee;
2. When there is an imperfect description of the gift
being given; and
3. When only one recipient is designated but it
turns out that there are two or more who fit the
description (Gilmer v. Stone, 120 U.S. 586).
HOW AMBIGUITIES ARE CURED
GENERAL RULE: Intrinsic or extrinsic evidence
may be used to ascertain the intention of the
testator.
EXCEPTION: The oral declarations of the testator
as to his intentions must be excluded (CIVIL CODE,
Art. 789).
REASON: The oral declarations of the testator are
merely HEARSAY. The testator can no longer refute
the testimonies of lying witnesses (JURADO,
Succession, supra at 35).
INVALIDITY OF A DISPOSITION IN A
WILL
The invalidity of one of several dispositions
contained in a will does not result in the invalidity of
the other dispositions, unless it is to be presumed
that the testator would not have made such other
dispositions if the first invalid disposition had not
been made (CIVIL CODE, Art. 792).
EXCEPTION: When various dispositions or
provisions are indivisible in nature and intent.
AFTER-ACQUIRED PROPERTY
Property acquired after the making of a will shall only
pass thereby, as if the testator had possessed it at
the time of making the will, should it expressly
appear by the will that such was his intention (CIVIL
CODE, Art. 793).
NOTE: The rule applies only to devises and legacies
and not to institution of heirs. (JURADO,
Succession, supra at 36).
EXTENT OF INTEREST THAT THE
TESTATOR MAY DISPOSE OF
Every devise or legacy shall convey all the interest
which the testator could devise or bequeath in the
property disposed of, unless it clearly appears from
the will that he intended to convey a less interest
(CIVIL CODE, Art. 794).
Illustration: X and Y co-own a parcel of land. X then
instituted in his will that he made Z the devisee as to
the parcel of land. Up to what extent of the land could
he convey to Z?
Answer: X, as co-owner of the property, may only
convey his share in the co-ownership no more, no
less.
LAW GOVERNING FORM OF WILLS
The validity of a will as to its form depends upon the
observance of the law in force at the time it is made
(CIVIL CODE, Art. 795).
KINDS OF VALIDITY
1. Extrinsic Validity
– Refers to the forms and solemnities needed.
2. Intrinsic Validity
– Refers to the legality of the provision in an
instrument, contract, or will.
EFFECTS OF A NEW LAW CHANGING
THE FORMALITIES OF A WILL
1. Before the death of the testator but after the
execution of the will, the new law has no
 retroactive effect (JURADO, Succession, supra of the Philippines Annotated, (2003) p. 117
at 38). [hereinafter, 3 TOLENTINO]).

EXCEPTION: When a retroactive effect is: b. Alien Testator

a. Expressly declared by the statute itself; or
b. Necessarily implied from the language used
therein (CIVIL CODE, Art. 4).
2. After the death of the testator, the rules have no
effect because the heirs already have a vested
right (JURADO, Succession, supra at 38).
NOTE: A will totally void at the time of its execution
cannot be validated by a subsequent legislation
(Severina A. Vda. De Enriquez v. Abadia, G.R. No.
L-7188, August 9, 1954).
GOVERNING LAW ON FORMALITIES
1. As to Time:
a. Extrinsic validity - Depends upon the
observance of the law in force at the time it
is made (CIVIL CODE, Art. 795).
b. Intrinsic validity - Judged at the time of the
decedent’s death by the law of his
nationality (3 PARAS, supra at 62).
2. As to Place (CIVIL CODE, Arts. 815 – 817):
The formal validity of a will shall be governed by
the law of the country in which it was executed
(CIVIL CODE, Art. 17).
a. Filipino testator
i. Executing a will in the Philippines or
before the diplomatic or consular
officials of the Republic of the
Philippines in a foreign country –
Philippine law.
ii. Executing a will outside of the
Philippines – either:
(1) The law of the country in which it is
executed or in which he may be
(CIVIL CODE, Arts. 17 and 815); or
(2) The law of the Philippines.
i. Executing a will in the Philippines –
either (CIVIL CODE, Arts. 17 and 817):
(1) The law of the Philippines; or
(2) The law of the country of which he
is a citizen or subject.
ii. Executing a will outside of the
Philippines – either (CIVIL CODE, Arts.
17 and 816):
(1) The law of the place where it is
executed;
(2) The law of the place in which he
resides;
(3) The law of his country; or
(4) The law of the Philippines.
ASPECTS OF THE WILL GOVERNED BY
NATIONAL LAW OF THE DECEDENT
(CIVIL CODE, Arts. 1039 and 16): (AICO)
1. Amount of successional rights;
2. Intrinsic validity;
3. Capacity to succeed; and
4. Order of succession.
DOCTRINE OF PROCESSUAL
PRESUMPTION
If the foreign law is not properly pleaded or proved,
our Courts will presume that the foreign law is the
same as our local or domestic law (Del Socorro v.
Wilsem, G.R. No. 193707, December 10, 2014).
TESTAMENTARY CAPACITY
(ARTS. 796-803)

Illustration: X, a Filipino citizen domiciled in TESTAMENTARY CAPACITY V.

Hong Kong, executed a will in Singapore. TESTAMENTARY POWER
Can the will be governed by the laws of the TESTAMENTARY TESTAMENTARY
Philippines? CAPACITY POWER
Answer: Yes. The Civil Code did not mean It refers to the ability as It refers to the privilege
to invalidate the will of a Filipino, executed well as the power to granted to the testator
in a foreign country, when it is made in make a will. to designate the person
conformity with our law and not in conformity or persons who are to
with the law of the place of execution. Arts. succeed him in his
816 and 817 permits an alien who executed inheritance.
a will in a foreign country other than his own
(JURADO, Succession, supra at 39).
to follow his national law or the formalities
prescribed by our law. It cannot be assumed
that the Civil Code places the Filipino citizen WHO CAN MAKE A WILL: (PS-18)
in a worse position than the alien in relation 1. All persons who are not expressly Prohibited by
to our own law (3 TOLENTINO, Civil Code law may make a will (CIVIL CODE, Art. 796).
 These persons shall only refer to natural judicial order has been set aside (3 PARAS,
persons, not juridical ones (3 PARAS, supra at supra at 78);
74). 3. He was under Guardianship at the time of
making his will (Torres and Lopez de Bueno v.
A convict under civil interdiction is allowed to Lopez, G.R. No. L-25966, November 1, 1926).
make a will because civil interdiction prohibits a
disposition of property inter vivos, not mortis The following circumstances do NOT affect
causa (REVISED PENAL CODE, Art. 34). testamentary capacity: (CAPIFO)
1. Civil Interdiction;
Spendthrifts or prodigals, even if under 2. Alienage;
guardianship, can make a will provided they are 3. Prodigality;
at least 18 years old and are of sound mind (3 4. Insolvency; and
PARAS, supra at 74). 5. Family Relations
6. Others of similar nature (JURADO, Succession,
2. At least 18 years of age (CIVIL CODE, Art. 797); supra at 39-40).

NOTE: A person is deemed to have reached the EFFECT OF CERTAIN INFIRMITIES

required age at the commencement of the day
1. Old Age
which is known as his birthday (CIVIL CODE,
Mere senility or infirmity of old age does not
Art. 13; DE LEON, Succession, supra at 67).
necessarily imply that a person lacks
testamentary capacity (Ortega v. Valmonte,
3. Of Sound mind (CIVIL CODE, Art. 798);
G.R. No. 157451, December 16, 2005).
NOTE: It is not necessary that the testator be in
Senile Dementia
full possession of all his reasoning faculties, or
It is the peculiar decay of the mental faculties
that his mind be wholly unbroken, unimpaired, or
whereby the person afflicted is reduced to
unshattered by disease, injury or other cause. It
second childhood. It is senile dementia and not
shall be sufficient if at the time of making the will,
senility that produces testamentary incapacity
he knows: (NOC)
(JURADO, Succession, supra at 46).
a. The Nature of the estate to be disposed of
(character, ownership of what he is giving);
To constitute complete senile dementia there
b. The proper Objects of his bounty (by
must be such failure of the mind as to deprive
persons who for some reason expect to
the testator of intelligent action. In the first
inherit something from him – like his
stages of the diseases, a person may possess
children); and
reason and have will power. If the testator still
c. The Character of the testamentary act (that
possessed the spark of reason and of life, that
it is really a will, that it is a disposition mortis
strength of mind to form a fixed intention and to
causa, that it is essentially revocable) (CIVIL
summon his enfeebled thoughts to enforce that
CODE, Art. 799; 3 PARAS, supra at 76).
intention, he is considered to possess
"testamentary capacity" (Torres and Lopez de
PRESUMPTION OF SOUND MIND Bueno v. Lopez, G.R. No. L-24569, February 26,
The law presumes that the testator is of sound mind. 1926).
Thus, the burden of proof that the testator was not of
sound mind at the time of making his disposition is 2. Infirmity or Disease
on the person who opposes the probate of the will Physical infirmity or disease is not inconsistent
(CIVIL CODE, Art. 800). with testamentary capacity

No presumption of insanity arises from the presence EXCEPTION: In case the testator, at the time of
of mere delirium, since this is temporary, nor from the execution of the will, is already in comatose
intoxication, for the same reason (3 PARAS, supra or semi-comatose condition (JURADO,
at 78). Succession, supra at 47).

Exceptions to Presumption of Sanity 3. Mental Disease or Insanity

The burden of proving sanity is cast upon the There may be mental incapacity to make a will
proponents of the will when (1-IG): without actual insanity.
1. The testator, one (1) month or less, before
making his will, was publicly known to be insane Persons suffering from idiocy (those
(CIVIL CODE, Art. 800 par. 2); congenitally deficient in intellect), and imbecility
2. If the testator made the will after he had been (those who are mentally deficient as a result of
judicially declared to be Insane and before such
 disease) do not possess the necessary mental
capacity to make a will (Id. at 48).
4. Mental Delusion
An insane delusion, which will render one
incapable of making a will, may be defined as a
belief in things which do not exist, and which no
rational mind would believe to exist
To justify the setting aside of a will, it must be
shown that the will was the product or offspring
of the delusion, or at least, that it was influenced
by the delusion (Id. at 49).
5. Belief in the Supernatural
Belief in spiritualism is not in itself sufficient
evidence of testamentary incapacity.
However, a will executed by one under such an
extraordinary belief in spiritualism that he
follows, blindly and implicitly, supposed
directions of spirits in constructing the will is not
admissible to probate (Id. at 49-50).
6. Drunkenness
GENERAL RULE: The admission of a will to
probate will not be denied merely on proof that
the testator was addicted to the excessive use
of alcoholic liquors or drugs (Id. at 50).
EXCEPTION: If at the time of the making of the
will, the testator was so much under the
influence of the intoxicants or drugs as to be
unable to bring to the business at hand the calm
judgment which the law requires of a testator (Id.
at 50).
7. Deaf-mute and Blind Person can make a
will (CIVIL CODE, Arts. 807-808).
SUPERVENING INCAPACITY
Supervening incapacity does not invalidate an
effective will, nor is the will of an incapable validated
by the supervening of capacity (CIVIL CODE, Art.
801).
FORMALITY OF WILLS AND
WITNESSES TO WILLS
(ARTS. 804-824)
KINDS OF WILLS
1. Ordinary or Notarial Will
That which requires, among other things, an
attestation clause, and an acknowledgment
before a notary public (3 PARAS, supra at 80).
Formal Requirements: (W2-SAMPAL)
a. In Writing;
b. Executed in a Language or dialect known to
the testator;
c. Subscription – Subscribed at the end thereof
by the testator himself or by testator’s name
written by some other person in his
presence and by his express direction;
d. Attested and subscribed by 3 or more
credible Witnesses in the presence of the
testator and of one another;
e. Marginal signature – All of the pages are
signed, except the last, on the left margin by:
i. The testator or the person requested by
him to write his name, in the presence
of the witnesses; and
ii. The instrumental witness, in the
presence of the testator and of one
another;
f. Page numbering – All the pages are
numbered correlatively in letters placed on
the upper part of each page;
g. Attestation clause executed by the
witnesses; and
h. Acknowledgment – Properly acknowledged
before a notary public by the testator and the
said witnesses (CIVIL CODE, Arts. 804-
806).
2. Holograph or Holographic Will
That which is entirely written, dated, and signed
by the hand of the testator himself (CIVIL CODE,
Art. 810).
NOTE: Nuncaptive wills – wills orally made by the
testator in contemplation of death, and before
competent witness. Our new Civil Code does not
recognize the validity of nuncaptive wills. Art. 804
does not recognize oral wills (3 PARAS, supra at
81).
OBJECTS OF FORMALITIES OF WILLS:
(CAG)
1. To Close the door against bad faith and fraud;
2. To Avoid substitution of wills and testaments;
and
3. To Guarantee their truth and authenticity
(JURADO, Succession, supra at 52).
So when an interpretation already given assures
such ends, any other interpretation whatsoever, that
adds nothing but demands more requisites entirely
unnecessary, useless and frustrative of testator’s
will, must be disregarded (Herreros v. Gil, G.R. No.
L-3362, March 1, 1951)
COMMON FORMALITIES BETWEEN
HOLOGRAPHIC AND NOTARIAL WILLS
1. Will must be in writing (CIVIL CODE, Art.
804).
If the will is ordinary, it does not matter on what
material it is written. It may be written by hand or
typewritten, or printed from plates or type
(JURADO, Succession, supra at 53).
Article 810 provides that in the case of
holographic wills, it must be written entirely in the
handwriting of the testator himself. It is only in
the case of ordinary wills that whoever performs
the mechanical act of writing or drafting the will
becomes a matter of indifference (Castañeda v.
Alemany, G.R. No. 1439, March 19, 1904).
2. Executed in a language or dialect known
to the testator (CIVIL CODE, Art. 804).
Testator’s knowledge or understanding of the
language/dialect need not be expressly stated
either in the body of the will or in the attestation
clause (JURADO, Succession, supra at 53).
NOTE: Donations mortis causa partake of the nature
of testamentary provisions (CIVIL CODE, Art. 728)
and as such, said deeds must be executed in
accordance with the requisites on solemnities of wills
and testaments under Arts. 805 and 806 (Maglasang
v. Heirs of Cabatingan, G.R. No. 131953; June 5,
2002).
NOTARIAL OR ORDINARY WILL (CIVIL
CODE, ART. 805): (SAM-PAA)
1. Subscription
The manual act by the testator and his
instrumental witnesses of affixing their signature
to the instrument (JURADO, Succession, supra
at 55).
PURPOSES:
a. To identify the testator; and
b. To authenticate the document (Id. at 55).
Forms:
a. Subscription by Testator
i. Manner of Signing
A sufficient signature to a will depends
largely on the custom of the time and
place, the habit of the individual, and the
circumstances of each particular case,
but it should be manifest that whatever
is used is actually intended as a
b. Signature by another
signature (Id. at 55).
NOTE: A complete signature is not
essential to the validity of a will (Id. at
56).
A will is not invalidated by the
misspelling of the testator’s name in the
signature, where it is clear that the
testator intended to execute the
instrument by the signature affixed (DE
LEON, Succession, supra at 98).
ii. Signature by Mark
Any mark or combination of marks
placed on a will by the testator is a
sufficient compliance, even if at the time
of placing it, the testator knew how to
write and is able to do so (JURADO,
Succession, supra at 56).
If the signature is only a mere cross, it is
acceptable as a valid signature,
provided it can be properly established
that it is the testator’s usual signature or
at least one of the ways by which he had
signed his name before (Leaño v.
Leaño, G.R. No. L-9150, March 31,
1915).
The requirement of the statute that the
will shall be "signed" is satisfied not only
the customary written signature but also
by the testator's or testatrix' thumbmark.
Expert testimony as to the identity of
thumbmarks or fingerprints is of course
admissible. However, where thumb
impressions are blurred and many of the
characteristic marks far from clear, thus
rendering it difficult to trace the features
enumerated by experts as showing the
identity or lack of identity of the
impressions, the court is justified in
refusing to accept the opinions of
alleged experts and in substituting its
own opinion that a distinct similarity in
some respects between the admittedly
genuine thumbmark and the questioned
thumbmarks, is evident (Dolor v.
Diancin, G.R. No. L-33365, December
20, 1930).
If writing a mark is a sufficient indication
of an intention to make a will then writing
a portion of all of her name is accepted
as a clear indication of her intention. In
this case the decedent used her first
name "Tomasa" (Yap Tua v. Yap
CaKuan, G.R. No. 6845, September 1,
1914).
Requisites: (TPEAW)
i. It is the testator’s name that must have
been written by the Third person;
ii. The testator’s name must have been
written in his Presence;
 iii. The third person must have affixed the
testator’s name at his Express direction;
iv. This fact should be stated in the
Attestation clause; and
v. It should take place in the presence of
the instrumental Witnesses (JURADO,
Succession, supra at 57).
NOTE: Neither the notary nor any of the
attesting witnesses can sign in behalf of the
testator (3 PARAS, supra at 89).
The testator need not be physically
incapacitated, to ask a third person to sign the
will for him, provided, that the fact of the signing
by the third person in his presence and under his
express direction, shall be stated in the
attestation clause (Garcia v. Lacuesta, G.R. No.
L-4067; November 29, 1951).
Place of signature (either by the testator or by
another): End of the will, otherwise, void
(JURADO, Succession, supra at 59).
End of Will
Refers to the logical end, which is the point
where the testamentary dispositions terminate
(3 TOLENTINO, supra at 70).
When Article 805 of the Civil Code requires the
testator to subscribe at the end of the will, it
necessarily refers to the logical end thereof,
which is where the last testamentary disposition
ends. In this case, the last page of the will does
not contain any testamentary disposition; it is but
a mere continuation of the Acknowledgment
(Mitra v. Sablan-Guevarra, G.R. No. 213994,
April 18, 2018).
Example: If a will starts on the first page,
continues on the third page, but is concluded on
the second page, the latter is the logical end (3
PARAS, supra at 87).
NOTE: If the testator’s first name appears,
without the surname, the will is valid (Yap Tua v.
Yap Ca Kuan, G.R. No. 6845, September 1,
1914). The will remains valid even though the
testator’s name is misspelled, abbreviated, or is
indicated only by nickname, or by “Father” or
“Mother,” or in an assumed name, provided the
testator intended the same to be his signature (3
PARAS, supra at 87-88).
PURPOSES:
a. To show that the testamentary purpose
therein expressed is completed;
b. To prevent any opportunity for fraud or
interpolations between the written matter
and signature; and
c. The position of the signature is an internal
evidence of finality or completion of intent
(JURADO, Succession, supra at 59).
2. Attestation and Subscription
Attestation is the act of three (3) or more
credible witnesses of witnessing the execution
of the will in the presence of the testator and of
one another in order to see and take note
mentally that such will has been executed in
accordance with the requirements prescribed by
law. Strictly speaking, it is the act of the
witnesses and not that of the testator.
Subscription consists in the manual act of the
instrumental witnesses in affixing their
signatures to the instrument for the purpose of
identification (Id. at 59-60).
Purposes of Requiring Witness to Attest and
to Subscribe to a Will: (PIPA)
a. Protection of the testator from fraud and
deception;
b. Identification of the instrument;
c. To render available Proof during probate
proceedings that the will has been executed
in accordance with the requirements
prescribed by law and that the instrument
offered for probate is authentic; and
d. The Ascertainment of the testamentary
capacity of the testator (Id. at 60-61).
ATTESTATION V. SUBSCRIPTION
ATTESTATION SUBSCRIPTION
As to What Performs the Act
An act of the senses. An act of the hand.
As to Nature of the Act
Mental act. Mechanical act.
As to Purpose
Purpose is to render Purpose is for
available proof during identification.
probate of will, not only
of the authenticity of the
will, but also of its due
execution.
As to Where in the Will Should It Be Place
Attestation clause may Subscription must
be placed at the always be at the logical
beginning of the will. end of the will.
Placing it at the end is
only for convenience.
(Id. at 60).
Order of Signing
As long as the signing is done within the
presence of one another, it really does not
matter much whether the witnesses signed
ahead of or after the testator as long as the
signing is sufficiently contemporaneous (Id. at
60-61).
“In the presence”
The execution of a will cannot be legally effective
if the various participants signed on various days
or occasions and in various combinations of
those present (Andalis v. Pulgueras, G.R. No.
39209, March 10, 1934).
While it may be true that the attestation clause
is indeed subscribed at the end thereof and at
the left margin of each page by the three,
attesting witnesses, it certainly cannot be
conclusively inferred therefrom that the said
witnesses affixed their respective signatures in
the presence of the testator and of each other
since, as petitioners correctly observed, the
presence of said signatures only establishes the
fact that it was indeed signed, but it does not
prove that the attesting witnesses did subscribe
to the will in the presence of the testator and of
each other. The execution of a will is supposed
to be one act so that where the testator and the
witnesses sign on various days or occasions
and in various combinations, the will cannot be
stamped with the imprimatur of effectivity
(Cañeda v. Court of Appeals, G.R. No. 103554,
May 28, 1993).
The phrase does not necessarily require actually
seeing, but the possibility of seeing without any
physical obstruction. When a person merely has
his back turned, the signing is done in his
presence since he could have cast his eyes in
the proper direction (Jaboneta v. Gustilo, G.R.
No. 1641, January 19, 1906).
The attaching of signatures was not done “in the
presence” of the witness if his line of vision to
the testator and the other subscribing witnesses
was impeded by a curtain separating them at the
moment of inscription of each signature (Nera v.
Rimando, G.R. No. L-5971, February 27, 1911).
In case the testator is blind, the presence may
be complied with if the signing or action is within
the range of the other senses like hearing, touch,
etc., of the testator (3 PARAS, supra at 89).
Test of Presence
The true test of vision is not whether the testator
actually saw the witness sign, but whether he
might have seen him sign, considering his
mental and physical condition and position at the
time of the subscription (Jaboneta v. Gustilo
et.al., G.R. No. 1641, January 19, 1906 supra).
It is not whether they actually saw each other
sign, but whether they might have seen each
other sign had they chosen to do so, considering
their mental and physical condition and position
with relation to each other at the moment of
inscription of each signature (Neyra v. Neyra,
C.A. No. 8075, March 25, 1946).
Number of Witnesses
The will must be attested and subscribed by 3 or
more credible witnesses (CIVIL CODE, Art.
805). This requirement is mandatory and if less
than 3 witnesses attested and subscribed
thereto, the will is void (Alaud v. Alaud, G.R. No.
176943, October 17, 2008).
If the attestation clause does not indicate the
number of witnesses, but the will clearly shows
four signatures: that of the testator and of the 3
other persons, it is reasonable to conclude that
there are 3 witnesses to the will (Testate Estate
of the Late Alipio Abada v. Abaja, G.R. No.
147145, January 31, 2005).
If the third witness is the notary public himself
before whom the will was supposed to have
been acknowledged, the requirements of
Articles 805 and 806 of the Civil Code are not
satisfied. The notary public before whom the will
was acknowledged cannot be considered as the
third instrumental witness since he cannot
acknowledge before himself his having signed
the will. He cannot split his personality into two
so that one will appear before the other to
acknowledge his participation in the making of
the will (Cruz v. Villasor, G.R. No. L-32213,
November 26, 1973).
3. Marginal Signatures
GENERAL RULE: Each and every page of the
will, except the last, shall be signed on the left
margin:
a. By the testator or the person requested by
him to write his name in the presence of the
witnesses; and
b. By the instrumental witnesses in the
presence of the testator and of one another
(CIVIL CODE, Art. 805).
There is a mandatory and directory part to this
requirement (1 RABUYA, supra at 762 and 764):
a. Mandatory part – the signing on every page
by the testator or the person requested by
him to write his name in the witnesses’
presence and the signing on every page by
the instrumental witnesses in the presence
of the testator and of one another
b. Directory part – the place of signing, i.e. the
left margin; can also be on the right margin,
provided, that the will contained the
necessary signatures on each page,
whereby each page of the will was
authenticated and safeguarded against any
possible alteration (Avera v. Garcia, G.R.
No. 15566, September 14, 1921).
EXCEPTIONS:
a. The last page need not be signed on the left
margin because, being the page where the
end of the will is, it contains the testator’s
signature (1 RABUYA, supra at 764);
b. When the will consists of only one page; and
c. When the will consists of two pages, the first
page contains all the testamentary
dispositions and is signed at the bottom by
the testator and the witnesses, and the
second contains only the attestation clause
signed at the bottom by the witnesses. As
the attestation clause appertains only to the
witnesses and not to the testator, it need be
signed only by them (Abangan v. Abangan,
G.R. No. 13431, November 12, 1919).
Failure to have the marginal signatures of the
testator and of the witnesses, when needed, is a
fatal defect that constitutes an obstacle of its
probate (In re: Will of Prieto, G.R. No. L-17761,
April 28, 1922).
The inadvertent failure of one witness to affix his
signature on one page of a testament, due to the
simultaneous lifting of two pages in the course
of signing, is not per se sufficient to justify denial
of probate (Icasiano v. Icasiano, G.R. No. L-
18979, June 30, 1964).
NOTE: This case must be applied only to cases
with similar facts. In Icasiano v. Icasiano, the
failure of the witness to sign one page was
entirely through oversight, as shown by his own
testimony as well as by the original duplicate
copy of the will, which was submitted to the court
and which bore a complete set of signatures in
every page (Icasiano v. Icasiano, G.R. No. L-
18979, June 30, 1964).
Page of the Will
The law refers expressly to “page” and not to
sheet or leaf or folio. A sheet has two pages, the
front and revers. If both pages of the sheet or
leaf are used, it is therefore necessary that both
front and reverse sides should bear the
signatures of the testator and of each of the
witnesses (3 TOLENTINO, supra at 85).
4. Page Numberings
All the pages of the will shall be numbered
correlatively in letters placed on the upper part
of each page (CIVIL CODE, Art. 805).
There is a mandatory and directory part to this
requirement:
a. Mandatory part – Pagination by means of a
conventional system.
b. Directory part – Pagination which shall be
numbered correlatively in letters placed on
the upper part of each page. Thus, the
pages may be numbered by mere
alphabetical letters, or by Arabic Numerals,
or by any form of identification. If the paging
be placed in the lower part, the testament is
not void for this sole reason (1 RABUYA,
supra at 769).
This is not necessary when the will is written on
one sheet only (Abangan v. Abangan, G.R. No.
L-13431, November 12, 1919).
Substantial compliance with the statutory
requirement is sufficient (JURADO, Succession,
supra at 73).
PURPOSES: (FIDS)
a. To guard against Fraud;
b. To prevent any Increase or decrease in the
pages;
c. To afford means of Detecting the loss of any
of its pages; and
d. To forestall any attempt to Suppress or
substitute any of the pages (DE LEON,
Succession, supra at 119).
NOTE: The law says “page” not sheet (a sheet
has two pages, the front and the reverse sides.
If both are used, both must be paged) (3
PARAS, supra at 87-88).
5. Attestation Clause (AC)
Memorandum or record of facts wherein the
witnesses certify that the will has been executed
before them, and that it has been executed in
accordance with the formalities prescribed by
law (JURADO, Succession, supra at 74).
NOTE: It must be signed by the witnesses, not
by the testator (Id.).
PURPOSE: It is made for the purpose of
preserving in a permanent form a record of the
facts that attended the execution of a particular
will, so that in case of failure of the memory of
the attesting witnesses, or other casualty, such
facts may still be proved (Cañeda v. CA, G.R.
No. 103554, May 28, 1993).
Contents (CIVIL CODE, Art. 805): (SAN)
a. The Number of pages used
GENERAL RULE: The failure to state the
number of pages on which the will was
written in the attestation clause is a fatal flaw
(Azuela v. CA, G.R. no. 122880, April 12,
2006).
EXCEPTION: There is substantial
compliance with the requirement if the will
states elsewhere in it, how many pages it is
comprised of, such as when the
acknowledgement itself states the same
(Mitra v. Sablan-Guevarra G.R. No. 213994,
April 18, 2018, citing Taboada v. Rosal, G.R.
No. L-36033 November 5, 1982).
There is no substantial compliance with Art.
809 if there is a discrepancy between the
number of pages stated in the
acknowledgment and the actual number of
pages of the will as it cannot be explained
by mere examination of the will itself but
through the presentation of evidence
aliunde (Lopez v. Lopez, G.R. No. 189984
(Resolution), November,12, 2012).
But if the number of pages is not stated in
any part of the will, and the will does not
contain any notarial acknowledgment
wherein the number of pages of the will
should be stated, the doctrine set forth in
Taboada v. Rosal is not applicable (Azuela
v. CA G.R. no. 122880, April 12, 2006).
PURPOSE OF THE RULE: To safeguard
against possible interpolation or omission of
one or some of its pages and to prevent any
increase or decrease in the pages (Azuela
v. CA, G.R. no. 122880, April 12, 2006).
NOTE: When the attestation clause
erroneously states the number of pages of
the will, the Court held that the error was not
material since the pagination in letters was
a sufficient safeguard of the will’s integrity
(Celada v. Avena, G.R. No. 145545, June
30, 2008).
b. The fact that the testator Signed the will and
every page thereof, or caused some other
person to write his name, under his express
direction, in the presence of the
instrumental witnesses; and
c. The fact that the witnesses witnessed and
signed the will and all the pages thereof in
the presence of the testator and of one
Another.
NOTE:
i. The attestation clause is the affair of the
witnesses; therefore, it need not be
signed by the testator (Fernandez v.
Vergel de Dios, G.R. No. L-21151,
February 25, 1924).
ii. The attestation clause need not be
written in a language or dialect known to
the testator nor to the attesting
witnesses since it does not form part of
the testamentary disposition (JURADO,
Succession, supra at 91).
NOTE: If the attestation clause is in a
language not known to the witnesses, it
shall be interpreted to them (CIVIL
CODE, Art. 805).
iii. The witnesses must sign at the bottom
of the attestation clause.
NOTE: If the page containing the
attestation clause is signed by the
witnesses on the left-hand margin but
their signatures do not appear at the
bottom of the attestation clause, the will
is fatally defective because the same
cannot be considered to have been
validly attested to by the instrumental
witnesses, as they failed to sign the
attestation clause (Azuela v. CA, G.R.
no. 122880, April 12, 2006).
The signatures on the left-hand corner
of every page signify, among others,
that the witnesses are aware that the
page they are signing forms part of the
will. On the other hand, the signatures
to the attestation clause establish that
the witnesses are referring to the
statements contained in the attestation
clause itself (1 RABUYA, supra at 758).
iv. The fact that the attestation clause was
written on a separate page has been
held to be a matter of “minor
importance” and apparently will not
affect the validity of the will (Villaflor v.
Tobias, G.R. No. 27440, December 24,
1927).
v. An attestation clause is mandatory for
attested wills. It is separate and distinct
from the acknowledgment clause
(certification of acknowledgment).
These two cannot be merged (Echavez
v. Dozen Construction, G.R. No.
192916, October 11,2010).
 vi. Absence of this clause will render the
will a nullity (JURADO, Succession,
supra at 74).
Effects of Defects or Imperfections in the
Attestation Clause
GENERAL RULE: The will shall be invalidated
if the defect of the attestation clause is
substantial in character. The defect is
substantial when it:
a. Goes into the very essence of the clause
itself; or
b. Consists in the omission of one, some, or all
of the essential facts which must be stated
in such clause, and such omission cannot
be cured by an examination of the will itself
(Id. at 76).
EXCEPTION: Doctrine of Liberal
Interpretation
Omissions or non-compliance with statutory
provisions as to form would not be fatal provided
that it can be established or deduced from an
examination of the will itself that all of the
statutory requirements have been complied with
(Id. at 83-84).
Requisites to avail of the Doctrine of Liberal
Interpretation:
a. Defects and imperfections must be in the
form of the attestation or in the language
used therein;
b. There must be no bad faith, forgery, fraud,
or undue and improper pressure and
influence, in the execution of the attestation
clause; and
c. It must be proved that the will was in fact
executed and attested in substantial
compliance with all the requirements of Art.
805 (Id. at 78; CIVIL CODE, Art. 809).
It may thus be stated that the rule, as it now
stands, is that omissions which can be supplied
by an examination of the will itself, without the
need of resorting to extrinsic evidence, will not
be fatal and, correspondingly, would not obstruct
the allowance to probate of the will being
assailed. However, those omissions which
cannot be supplied, except by evidence aliunde,
would result in the invalidation of the attestation
clause and ultimately, of the will itself (Cañeda
v. CA, G.R. No. 103554, May 28, 1993).
The rule must be limited to disregarding those
defects that can be supplied by an examination
of the will itself:
a. Whether all the pages are consecutively
numbered;
b. Whether the signatures appear in each and
every page; whether the subscribing
witnesses are three; and
c. Whether the will was notarized (Cañeda v.
CA, G.R. No. 103554, May 28, 1993).
All these are facts that the will can reveal, and
defects or even omissions concerning them in
the attestation clause can be safely disregarded.
But the total number of pages, and whether all
persons required to sign did so in the presence
of each other must substantially appear in the
attestation clause, being the only check against
perjury in the probate proceedings (Cañeda v.
CA, G.R. No. 103554, May 28, 1993).
6. Notarial Acknowledgment
Done before a notary public by the testator and
the instrumental witnesses (CIVIL CODE, Art.
806).
Acknowledgment is the act of one who has
executed a deed in going before some
competent officer or court and declaring it to be
his act or deed. It involves an extra step
undertaken whereby the signatory actually
declares to the notary public that the same is his
or her own free act and deed (Lee v. Tambago,
A.C. No. 5281, February 12, 2008).
The acknowledgment in a notarial will has a two-
fold purpose:
a. To safeguard the testators wishes long after
his demise; and
b. To assure that his estate is administered in
the manner that he intends it to be done
(Lee v. Tambago, A.C. No. 5281, February
12, 2008).
A notarial will that is not acknowledged before a
notary public by the testator and the witnesses
is fatally defective, even if it is subscribed and
sworn to before the notary public (Azuela v. CA,
G.R. No. 122880, April 12, 2006).
A will which contains a mere jurat and does not
contain an acknowledgment is fatally defective
because Art. 806 requires that the will be
“acknowledged” and not merely subscribed and
sworn to (Azuela v. CA, G.R. no. 122880, April
12, 2006).
The notary public must be duly commissioned
for the locality where the acknowledgment is
made. Otherwise, the notarization – and the will
– will be void. An acknowledgement taken
outside the territorial limits of the officer’s
jurisdiction is void as if the person taking it were
wholly without official character (Guerrero v.
Bihis, G.R. No. 174144, April 17, 2007).
 The Civil Code does not require that the signing
of the testator, witnesses and notary should be
accomplished in one single act (Javellana v.
Ledesma, G.R. No. L-7179, June 30, 1955).
Affixing of documentary stamp is not required for
validity (Gabucan v. Manta, G.R. No. L-51546,
January 28, 1980).
The requirement in Art. 806 does not apply to
holographic wills because the latter are not
required to be witnessed (1 RABUYA, supra at
785).
ADDITIONAL POINTERS ON
FORMALITIES OF NOTARIAL OR
ORDINARY WILL
1. Date of Will
NOT an essential part (3 TOLENTINO, supra at
100).
REASON: It would still be dated in its notarial
acknowledgment.
Conflict between the dates appearing on the will
does not invalidate the document because the
law does not even require that a notarial will be
executed and acknowledged on the same
occasion (Ortega v. Valmonte, G.R. No. 157451,
December 16, 2005).
2. Additional Requirements for Special
Cases
a. Deaf or Deaf–Mute Testator
i. Personal reading of the will, if able to do
so; or
ii. If not possible, designation of two (2)
persons to read the will and
communicate to him, in some
practicable manner, the contents
thereof (CIVIL CODE, Art. 807).
b. Blind Testator
Double–reading requirement:
i. First, by one of the subscribing
witnesses; and
ii. Second, by the notary public before
whom the will is acknowledged (CIVIL
CODE, Art. 808).
Art. 808 of the Civil Code applies not only to
blind testators, but also to those who for one
reason or another are incapable of reading their
wills (Alvarado v. Gaviola, G.R. No. 74695,
September 14, 1993).
In a case where the testator did not read the final
draft of the will, but the lawyer who drafted the
document read the same aloud in the presence
of the testator, three (3) witnesses, and notary
public, the Court held that the formal
imperfections should be brushed aside when the
spirit behind the law was served though the letter
was not (Alvarado v. Gaviola, G.R. No. 74695,
September 14, 1993).
NOTE: The facts required in Articles 807 and
808 are not required to be stated in the
attestation clause. The same may be proved by
extrinsic evidence (1 RABUYA, supra at 789).
3. Witness to Notarial Wills
Requisites: (D-CRABS)
a. Any person of Sound mind and
b. At the Age of eighteen (18) years or more;
c. Not Blind, deaf or dumb;
d. Able to Read and write, may be a witness to
the execution of a will mentioned in Article
805 of the Civil Code (CIVIL CODE, Art.
820).
e. Domiciled in the Philippines; and
f. Has not been Convicted by final judgment of
falsification of a document, perjury, or false
testimony (CIVIL CODE, Art. 821).
NOTE: A witness need not know the contents of
the will, and need not be shown to have had a
good standing in the community where he lives
(JURADO, Succession, supra at 110).
The requirement that the witnesses must be
domiciled in the Philippines applies only if a
Filipino citizen executes his will in the
Philippines (1 RABUYA, supra at 797).
Interested Witness
A person attesting the execution of a will to
whom or to whose spouse, parent, or child, a
devise or legacy is given (CIVIL CODE, Art.823).
Effects of being an interested Witness:
a. He shall be admitted as a witness; but
b. The devise or legacy, so far only as
concerns him, his spouse, parent or child, or
any one claiming under any of them, shall
be void, unless there are three other
competent witnesses to such will (CIVIL
CODE, Art. 823).
NOTE: The persons named in Art. 823 are
incapacitated to inherit but not incapacitated as
witnesses (3 PARAS, supra at 130).
The disqualification is not limited to the devisee
or legatee but extends to one succeeding by will
(3 TOLENTINO, supra at 125). Those who are
incapable of succeeding by will includes, among
others, any attesting witness to the execution of
a will, the spouse, parents, or children, or any
 one claiming under such witness, spouse,
parents, or children (CIVIL CODE, Art. 1027,
par. 4).
Credible Witness
It means competent witness, that is, such
person as are not legally disqualified from
testifying in courts of justice by reason of mental
incapacity, interest, or the commission of
crimes, or other causes excluding them from
testifying generally (JURADO, Succession,
supra at 111).
Creditor Witness
A mere charge on the estate of the testator for
the payment of debts due at the time of the
testator’s death does not prevent his creditors
from being competent witnesses to his will
(CIVIL CODE, Art. 824).
NOTE: A person who is qualified to make a will
is not necessarily qualified to be a witness to the
will of another (JURADO, Succession, supra at
113).
Effect of Subsequent Incompetency
If the witnesses attesting the execution of a will
are competent at the time of attesting, their
becoming subsequently incompetent shall not
prevent the allowance of the will (CIVIL CODE,
Art. 822).
The competency of a witness to a will is to be
determined as of the time of the execution of the
instrument, and not as of the time when the will
is presented for probate (JURADO, Succession,
supra at 113).
HOLOGRAPHIC WILL
A holographic will is one entirely written, dated, and
signed by the hand of the testator himself. It is
subject to no other form, and may be made in or out
of the Philippines, and need not be witnessed (CIVIL
CODE, Art. 810).
The Doctrines of Liberal Interpretation and
Substantial Compliance, as applied to ordinary or
notarial wills, cannot be applied to holographic wills
(JURADO, Succession, supra at 94).
REASON: The law exacts literal compliance with the
requirements of Article 810 (Id.).
PURPOSES OF STRICT COMPLIANCE:
1. Safeguard the authenticity of the will, and
2. Deter or prevent any possible insertion or
interpolation by others or any possible forgery
(Id.).
FORMALITIES: (WDSL)
1. Entirely Written by the Hand of the
Testator;
Effects of Insertions or Interpolations by Third
Persons (3 TOLENTINO, supra at 111-112):
a. If made after the execution of the will
without the consent of the testator, such
insertion is considered as not written.
REASON: The validity of the will cannot be
defeated by the malice or caprice of third
persons.
b. If made after the execution of the will with
the consent of the testator, the will remains
valid but the insertion is void.
c. If made after the execution of the will, and
the insertion is validated by the testator by
his signature thereon, the insertion
becomes part of the will and the will is void.
REASON: Non-compliance with the
requirement that it must be entirely written
by the hand of the testator.
d. If made contemporaneous to the execution
of the will, the will is void.
REASON: Will is not entirely written by the
hand of the testator.
2. Entirely Dated by the Hand of the
Testator;
Date Format
The “date” in a holographic will should include
the day, month, and year of its execution.
However, when there is no appearance of fraud,
bad faith, undue influence and pressure, and the
authenticity of the will is established, and the
only issue is whether or not the date “FEB. 1961”
appearing on the will is a valid compliance with
Art. 810, probate of the holographic will should
be allowed under the principle of substantial
compliance (Roxas v. De Jesus, Jr., G.R. No. L-
38338, January 28, 1985). This is an essential
part of a holographic will.
Reason for the Date Requirement: So that in
case of a revision of the will, that of the later date
should be preferred as expressing truly the last
will and testament (3 PARAS, supra at 110).
NOTE: Failure or error to state the place of
execution will not invalidate the will (3
TOLENTINO, supra at 101).
The law does not specify a particular location
where the date should be placed in the will. The
 only requirements are that the date be in the will
itself and executed in the hand of the testator
(Labrador v. CA, G.R. No. 83843-44, April 5,
1990).
3. Entirely Signed by the Hand of the
Testator;
GENERAL RULE: Art. 810 does NOT require
that the testator must sign the will with his full
signature.
it is a matter that may be established by proof
aliunde (JURADO, Succession, supra at 53).
But where a will is drawn up in the dialect of a
certain locality and it is established that the
testator was living in or was a resident of that
locality, there arises a presumption that the will
is drawn up in a language or dialect known to the
testator, in the absence of evidence to the
contrary (Id.).

NOTE: Signing by means of thumbprint is not Rules in Cases of Subsequent Dispositions

allowed because the law requires that the will be 1. The dispositions of the testator written below his
“signed by the hand of the testator” (1 RABUYA, signature must be dated and signed by him in
supra at 791). order to make them valid as testamentary
dispositions (CIVIL CODE, Art. 812)
EXCEPTION: In case of any insertion, 2. When a number of dispositions appearing in a
cancellation, erasure or alteration in a holographic will are signed without being dates,
holographic will, the testator must authenticate and the last disposition has a signature and a
the same by his FULL SIGNATURE (CIVIL date, such date validates the dispositions
CODE, Art. 814). preceding it, whatever be the time of prior
dispositions (CIVIL CODE, Art. 813).
Ordinarily, when a number of erasures,
corrections, and interlineations made by the RULES FOR CURING DEFECTS
testator in a holographic will has not been noted
SCENARIO STATUS
under his signature, the will is not thereby
invalidated as a whole, but at most only as Several dispositions Valid
respects the particular words erased, corrected, were signed but NOT
or interlined (Kalaw v. Relova, G.R. No. L- dated, and the last REASON: The date of
40207, September 28, 1984). disposition is signed the last disposition cures
and dated. the defect (CIVIL CODE,
However, when as in this case, the holographic Art. 813).
Will in dispute had only one substantial
provision, which was altered by substituting the Several dispositions Void
original heir with another, but which alteration were NOT signed and
did not carry the requisite of full authentication NOT dated, but the last EXCEPTION: They were
by the full signature of the testator, the effect disposition is signed written on the same date
must be that the entire Will is voided or revoked and dated. and occasion as the
for the simple reason that nothing remains in the latter disposition
Will after that which could remain valid. To state
that the Will as first written should be given Several dispositions Void
efficacy is to disregard the seeming change of were NOT signed but
mind of the testatrix. But that change of mind can dated, and the last REASON: They are
neither be given effect because she failed to disposition is signed considered independent
authenticate it in the manner required by law by and dated. of the will.
affixing her full signature (Kalaw v. Relova, G.R.
No. L-40207, September 28, 1984).
The last disposition is Void
Location of the Signature signed but NOT dated.
At the end of the will. This is evident from Article REASON: Art. 810
812 (DE LEON, Succession, supra at 152). requires the holographic
will to be dated.
4. Executed in a Language or Dialect (DE LEON, Succession, supra at 160).
known to the Testator.
There is no statutory requirement that the NOTE: If the testator fails to sign and date some of
testator’s knowledge or understanding of the the dispositions, the result is that these dispositions
language or dialect in which the will is executed cannot be effectuated. Such failure, however, does
should be expressed either in the body of the will not render the whole testament void (Ajero v. CA,
itself or in the attestation clause. Consequently, G.R. No. 106720, September 15, 1994).
ADDITIONAL POINTERS ON JOINT WILLS
HOLOGRAPHIC WILL A single testamentary instrument which contains the
1. Probate of Holographic Will (CIVIL wills of two or more persons, jointly executed by
CODE, Art. 811) them, either for their reciprocal benefit or for the
GENERAL RULE: The original of the benefit of a third person (JURADO, Succession,
holographic will should be presented to the supra at 106).
probate court for visual examination. The law,
considering the special nature of holographic Joint wills executed by Filipino citizens are void
wills as well as the special requirements for their whether executed in the Philippines or abroad and
probate, regards the document itself as material even though authorized by the laws of the country
proof of authenticity (JURADO, Succession, where they may have been executed (CIVIL CODE,
supra at 98). Arts. 818 and 819).

EXCEPTION: A photostatic or xerox copy of a NOTE: The prohibition does not apply to joint wills
lost or destroyed holographic will may be executed by aliens (CIVIL CODE, Art. 819).
admitted. The authenticity of the handwriting of
the deceased can be determined by the probate Kinds:
court, as comparison can be made with the 1. Mutual Wills
standard writings of the testator (Gan v. Yap, – Executed pursuant to an agreement between
G.R. No. L-12190, August 30, 1958; Rodelas v. two or more persons to dispose of their property
Aranza, G.R. No. L-58509, December 7, 1982). in a particular manner, each in consideration of
the other (JURADO, Succession, supra at 106).
2. Witnesses (CIVIL CODE, Art. 811)
2. Reciprocal Wills
a. If uncontested, it shall be necessary that at
– The testators name each other as
least one (1) witness who knows the
beneficiaries under similar testamentary plans
handwriting and signature of the testator
(Id.).
explicitly declare that the will and signature
are in the handwriting of the testator.
NOTE: Mutual or reciprocal wills are NOT prohibited
b. If contested, at least three (3) of such
provided they are contained in separate instruments.
witnesses shall be required.
The prohibition under Art. 818 is the execution of a
c. In the absence of any competent witness,
joint will or a will contained in the SAME instrument,
and if the court deems it necessary, expert
either for reciprocal benefit or for the benefit of a third
testimony may be resorted to.
person (Id.).
NOTE: In one case, the Supreme Court held that
REASONS (3 PARAS, supra at 124):
the provisions of Art. 811 are mandatory. Thus,
1. A will is a purely personal and unilateral act.
the production of three witnesses, in case the
2. Contrary to the revocable character of a will.
will is contested, cannot be dispensed with
3. May expose the testator to undue influence, and
(Codoy v. Calugay, G.R. No. 123486, August
may even induce one of the testators to kill the
12, 1999).
other.
The opposition was filed by a mere stranger who
had no personality to contest the wills. Thus, his
opposition thereto did not have the legal effect
of requiring the three witnesses (Rivera v. IAC, CODICIL AND
G.R. No. 75005, February 15, 1990). INCORPORATION BY
Matters to be Proved by the Testimony of the REFERENCE
Witness
1. He knows the handwriting and signature of the
(ARTS. 825-827)
testator;
2. The will is in the handwriting of the testator; and
3. The signature is in the handwriting of the testator
(CIVIL CODE, Art. 811).
CODICIL
A supplement or addition to a will, made after the
Governing Law on Formalities execution of a will and annexed to be taken as part
(Please refer to p. 268 for full discussion on thereof, by which any disposition made in the original
Governing Law on Formalities). will is explained, added to, or altered (CIVIL CODE,
Art. 825).
It always refers to the original will. If there is entirely
no reference at all, then it is considered as the new
will. If the later instrument makes dispositions
independent of those in the original will, without
explaining or modifying such original will, then it is a
new will, not a codicil. A codicil is always related to
some prior will (3 TOLENTINO, supra at 126).
Its execution has the effect of republishing the will as
modified by the codicil (CIVIL CODE, Art. 836).
In order to operate as a republication of the will, it is
sufficient if the codicil refers to the will in such a way
as to leave no doubt as to the identity of that
instrument (JURADO, Succession, supra at 115).
To be effective, it shall be executed as in the case of
a will (CIVIL CODE, Art. 826). The form of a codicil
need not follow the form of the prior will to which it
relates. A notarial codicil can modify a holographic
will and a holographic codicil can modify a notarial
will. What is important is that it is executed with all
the formalities of a will (DE LEON, Succession,
supra at 178).
In case of conflict, the codicil prevails, it being the
later expression of the testator's will (3 PARAS,
supra at 132).
NOTE: A notarial and a holographic will may be
revoked by either a notarial or holographic codicil (Id.
at 133). A valid will can never be revoked, expressly
or impliedly, by an invalid codicil (Id.).
CODICIL V. SUBSEQUENT WILL
CODICIL SUBSEQUENT WILL
As to Effect
Forms part of the A new or separate will.
original will.
As to Purpose
Supplements the Makes dispositions
original will, explaining, without reference to and
adding to, or altering independent of the
any of its dispositions. original will.
As to Revocation of the Prior Will
Does not, as a rule, If it provides for a full
revoke entirely the prior disposition of the
will. testator’s estate, it may
revoke the whole prior
will by substituting a
new and last disposition
for the same.
CODICIL SUBSEQUENT WILL
As to Construction
A will and codicil thereto A prior will and a
being regarded as a subsequent will, being
single instrument, are to two separate wills, may
be construed together. be construed
independently of each
other.
(DE LEON, Succession, supra at 177).
INCORPORATION BY REFERENCE
The incorporation of an extrinsic document or paper
into a will by reference therein so as to become a
part thereof and probated as such (Id. At 178).
If a will, executed as required by the Civil Code,
incorporates into itself by reference any document or
paper, such document or paper shall not be
considered a part of the will unless the requisites for
a valid incorporation by reference are present (CIVIL
CODE, Art. 827).
Requisites for a Valid Incorporation by
Reference: (EDIS or SIDE)
1. The document or paper referred to in the will
must be in Existence at the time of the execution
of the will;
2. The will must clearly Describe and identify the
same, stating among other things the number of
pages thereof;
3. It must be Identified by clear and satisfactory
proof as the document or paper referred to
therein; and
4. It must be Signed by the testator and the
witnesses on each and every page, except in
case of voluminous books of account or
inventories (CIVIL CODE, Art. 827).
REASON FOR PROVISION
This is allowed only with respect to provisions in a
will that are not in the nature of testamentary
dispositions and also provisions which may be
incorporated to the will merely for convenience or
reference (DE LEON, Succession, supra at 179).
NOTE: The exception in the fourth requisite refers
only to the signing of all pages; while not every page
has to be signed, there must be a signature on at
least several pages (3 PARAS, supra at 134).
When, in a will, reference is made to an inventory of
the properties of the testator, which has thus been
made part of the will, and the will has an attestation
clause that meets the requirements of the law, no
attestation clause is necessary for the said inventory
(Unson v. Abella, G.R. No. 17857, June 12, 1922).
Provisions which are in the nature of testamentary
dispositions must be contained in the will itself.
Parol evidence may be admitted to prove the identity
of the document as incorporated (3 TOLENTINO,
supra at 127).
From the fact that Art. 827 (4) of the Civil Code
speaks of “witnesses,” it is reasonable to believe that
as a rule, only notarial wills can have this
incorporation by reference. However, it is submitted
that:
1. If a holographic will happens to have at least
three credible and qualified witnesses, there can
be a proper incorporation by reference; or
2. If a holographic will (with NO witnesses) refers
to a document entirely written, dated, and signed
in the handwriting of the testator, there can also
be a proper incorporation by reference (3
PARAS, supra at 135).
REVOCATION OF WILLS
AND TESTAMENTARY
DISPOSITION
(ARTS. 828-834)
REVOCATION
It is an act of the mind, terminating the potential
capacity of the will to operate at the death of the
testator, manifested by some outward or visible act
or sign, symbolic thereof (JURADO, Succession,
supra at 116).
A will may be revoked by the testator at any time
before his death. Any waiver or restriction of this
right is void (CIVIL CODE, Art. 828).
After a will has been probated during the lifetime of
the testator, it does not necessarily mean that he
cannot alter or revoke the same (Palacios v.
Palacios, G.R. No. L-12207, December 24, 1959).
NATURE AND EFFECT OF
REVOCATION
Upon revocation, the will or testamentary disposition
intended to be revoked ceases to exist and is
inoperative as if it has never been written. A will
being a unilateral disposition of property, acquires
binding force only at the death of the testator, it
follows that no present rights are conferred at the
time of its execution, and no title vests in the
beneficiary during the life of the testator (JURADO,
Succession, supra at 117).
NOTE: The recognition of an illegitimate child does
not lose its legal effect, even though the will wherein
it was made should be revoked (CIVIL CODE, Art.
834).
GOVERNING LAWS FOR REVOCATION
1. If revocation is made in the Philippines –
Philippine Law
2. If revocation is made outside the Philippines
a. If testator is not domiciled in the Philippines:
i. Law of the place where the will was
made or
ii. Law of the place where the testator was
domiciled at the time of the revocation
(CIVIL CODE, Art. 829).
b. If testator domiciled in the Philippines
i. Philippine law – the Philippines being
his domicile; or
ii. Law of the place of revocation (CIVIL
CODE, Art. 17)
iii. Follow the law of the place where the
will was made (by analogy with the rules
on revocation where the testator is a
non-Philippine domiciliary) (BALANE,
Jottings and Jurisprudence in Civil Law
(Succession), (2016), p. 184
[hereinafter, BALANE, Succession]).
MODES OF REVOCATION: (LID)
1. By Implication of Law (CIVIL CODE, Art.
830) (PUJ-BALAT)
The kind of revocation produced by operation of
law when certain acts or events take place after
a will has been made, rendering void or useless
either the whole will or certain testamentary
dispositions therein (3 PARAS, supra at 138).
a. Preterition shall annul the institution of heir
(CIVIL CODE, Art. 854);
b. Act of Unworthiness by an heir,
devisee/legatee revokes testamentary
provisions in his favor (CIVIL CODE, Art.
1032);
c. Judicial action for recovery of debt revokes
a legacy of credit/remission of debt (CIVIL
CODE, Arts. 935 and 936);
d. If both spouses of the subsequent marriage
in Art. 41 (Family Code) acted in Bad faith,
said marriage shall be void ab initio and
testamentary dispositions made by one in
favor of the other are revoked by operation
of law (FAMILY CODE, Art. 44);
e. Alienation, transformation, or loss of
bequeathed property revokes a legacy of
such property (CIVIL CODE, Art. 957);
f. When there is a decree of Legal separation
(FAMILY CODE, Art. 63, Par. 4);
 NOTE: In legal separation, a spouse may still
inherit from the other spouse, unless found
guilty of the legal grounds of legal
separation (FAMILY CODE, Art. 63, Par. 4).
g. Annulled or void ab initio marriages revoke
testamentary dispositions made by one
spouse in favor of the other (FAMILY CODE,
Art. 50 in relation to Art. 43, par. 5);
h. The Termination of the subsequent
marriage in Art. 41 (Family Code) revokes
testamentary dispositions made by the
innocent spouse in favor of the guilty spouse
(FAMILY CODE, Art. 43 Par. 5).
2. By Subsequent Instrument (CIVIL CODE,
Art. 830)
Requisites for a Valid Revocation by a
Subsequent Instrument (DE LEON,
Succession, supra at 184-185): (FACE)
a. The subsequent instrument must comply
with the Formal requirements of a will; (Molo
v. Molo, G.R. No. L-2538, September 21,
1951, citing Samson v. Naval, G.R. No. L-
11823, February 11, 1918);
b. The subsequent instrument must be
Admitted to probate;
c. The testator must possess testamentary
Capacity; and
d. The subsequent instrument must either
contain an Express revocatory clause or be
incompatible with the prior will (CIVIL
CODE, Art. 831; DE LEON, Succession,
supra at 184-185).
i. Express – there is a revocatory clause
expressly revoking the previous will or a
part thereof. It may be effected by:
(1) Subsequent will
(2) Codicil
If the revocation is partial, it will
have the effect of republishing the
will as of the date of the codicil with
respect to all parts not revoked. If
the revocation is total, there is no
republication (JURADO,
Succession, supra at 121).
(3) Non–testamentary writing executed
as in case of wills – does not contain
an affirmative disposition of the
property, thus it cannot impliedly
revoke a will as it cannot be said to
be inconsistent with the dispositions
contained in the will (Id. at 122).
In all of the three ways of express
revocation, the revocatory clause must
clearly and unmistakably manifest the
intention of the testator to revoke the
previous will (Id. at 121).
An invalid revoking will cannot revoke,
but a valid though ineffective will can
revoke (3 PARAS, supra at 146).
ii. Implied – when the provisions thereof
are partially or absolutely inconsistent
with those of the previous wills. May be
effected only by:
(1) Subsequent will
(2) Codicil
Subsequent wills which do not revoke the
previous ones in an express manner, annul
only such dispositions in the prior wills as
are inconsistent with or contrary to those
contained in the later wills (CIVIL CODE,
Art. 831).
Two separate and distinct wills may be
probated if one does not revoke the other
and provided that the statutory requirements
relative to the execution of wills have been
complied with (Merza v. Porras, G.R. No. L-
4888, May 25, 1953).
3. By Destruction of the Will (CIVIL CODE,
Art. 830)
Requisites (DE LEON, Succession, supra at
185): (TITO-C)
a. Performed by the Testator himself or by
some other person in his presence, and by
his express direction;
Effect of Unauthorized Destruction
A will may still be proved as lost or
destroyed. However, this is possible only if
the will is attested; if the will is holographic,
it cannot be probated if it is lost, even if the
loss or destruction was unauthorized (Gan
v. Yap, G.R. No. L-12190, August 30, 1958),
unless a copy survives.
Ratification of an unauthorized destruction
is however permissible, provided sufficient
proof of this is presented (3 PARAS, supra
at 140).
NOTE: If burned, torn, cancelled, or
obliterated by some other person, without
the express direction of the testator, the will
may still be established, and the estate
distributed in accordance therewith,
provided the following are established:
(CDF)
i. Contents;
 ii. Due execution; and
iii. Fact of unauthorized destruction (3
TOLENTINO, supra at 138)
b. Testator must have Testamentary capacity
at the time of performing the act of
destruction;
c. Intent to revoke (animus revocandi)
The intention to revoke must appear clearly
and unequivocally. An act of destruction
which is done accidentally, by mistake, or as
a result of fraud, undue influence, does not
operate as a revocation (JURADO,
Succession, supra at 123).
The intention to revoke must concur with an
overt act, manifesting the intention. Neither
destruction without intention nor intention
without destruction would result to
revocation of the will (Id.).
d. The act must be any of the Overt acts
specified;
It must be a mental process demonstrated
by some outward and visible sign
(JURADO, Succession, supra at 123-124).
e. It must be a Completed act
The act is still deemed to be in the
subjective phase if the testator intends to do
a further act.
Burning
There must be at least a burning of a part of the
paper on which the will is written, although a very
slight burn will suffice (JURADO, Succession,
supra at 126).
It is sufficient if a small part of the instrument
itself be burned even though the entire writing
itself be left untouched (3 PARAS, supra at 140).
If the document itself is not burned, even
partially, but only the envelope in which it was
placed was burned, there is no revocation of the
will. But where the maker of the will threw it upon
the fire with the intent to revoke, and it was
burned through in three places, this was
considered a revocation, although the writing
remained intact, and although it was rescued
and preserved without the knowledge of the
testator (3 TOLENTINO, supra at 135).
Tearing
A slight act of tearing is generally held sufficient;
although the greater the degree of tearing the
stronger is the presumption that the instrument
was torn with animus revocandi (JURADO,
Succession, supra at 126).
The act of tearing must be a COMPLETE ACT.
Otherwise, if the testator desists voluntarily or
through the persuasion of others before the act
of destruction could be consummated, the act of
revocation has not also been consummated.
Hence, it produces no effect (Id.).
Tearing of even the signature alone constitutes
revocation, provided the other requisites are
present. This is because the signature goes to
the very heart of the will (3 PARAS, supra at
142).
Humpty Dumpty Rule
Once a will has been torn and revoked it can no
longer be revived by putting the pieces together
(Pier 66 Co. v. Poulos, 542 So. 2d 377).
NOTE: The mere act of “crumpling'': or the
removal of the “fastener” binding the pages of a
will does not constitute revocation, even though
there be animus revocandi. However, in Roxas
v. Roxas, 48 O.G. 2177, the court impliedly
allowed crumpling as one of the overt acts,
provided there is animo revocandi (3 PARAS,
supra at 142).
Cancelling
Effected by diagonal or horizontal lines, or criss-
crosses, or the word “cancelled”, written upon
the face of the will or upon any part thereof
(JURADO, Succession, supra at 127-128).
Marks made upon a will by the testator are
effective as a revocation by cancellation,
regardless of their depth, faintness, or other
characteristics, if they were placed there for the
purpose of canceling the will (Id.).
The cancellation need not render the will illegible
(Id.).
Obliterating
Effected by erasing or scraping off any word or
disposition, which the testator intends to revoke.
Obliteration renders the will illegible (Id.).
NOTE: Revocation by cancellation or
obliteration may be partial or total as opposed to
Revocation by Burning or Tearing which is
always total. The revocation is partial if it is
directed against a nonessential part of the will
and total if it is directed against an essential part
thereof (Id.).
Illustration: X, the testator, asked his friend Y
to get his will and burn it for him. Y then burned
 the will in a separate room and returned with
only the ashes. Is there a valid revocation?
Answer: The revocation was not valid. It was
not done in the presence of the testator as
provided for by Article 830(3) of the Civil Code.
DOCTRINE OF PRESUMED
REVOCATION
In the absence of other evidence, it shall be
presumed that the testator destroyed the will with
animus revocandi:
1. Where the will cannot be found following the
death of the testator and it is shown that it was
in the testator’s possession when last seen;
2. Where the will cannot be found following the
death of the testator and it is shown that the
testator had ready access to it; and
3. Where it is shown that the will was in the custody
of the testator after its execution, and
subsequently, it was found among the testator’s
effects after his death in such state of mutilation,
cancellation or obliteration as represents a
sufficient act of revocation within the meaning of
the applicable statute (Id. at 128-129).
The efficacy of the revocatory clause does not
depend on the testamentary dispositions of the
revoking will, unless the testator so provides.
Revocation is, generally speaking, an absolute
provision, independent of the acceptance or
capacity of the new heirs (BALANE, Succession,
supra at 193-194).
Example: X executes a will, naming A as his
universal heir. Two years later, X executes a second
will revoking the first and naming B as his universal
heir. X then dies and B renounces the inheritance.
The first will remains revoked (Id.).
DOCTRINE OF DEPENDENT RELATIVE
REVOCATION
If a testator revokes a will with a present intention of
making a new one immediately and as a substitute,
and the new will is not made, or if made, fails to take
effect for any reason, it will be presumed that the
testator preferred the old will than intestacy, and the
old one will be admitted to probate in the absence of
evidence overcoming the presumption, provided its
contents can be ascertained (JURADO, Succession,
supra at 129).
Being merely a presumed intention, it does not
prevail as against actual evidence of the testator’s
intention (Id. at 130).
NOTE: Where the act of destruction is connected
with the making of another will so as to fairly raise
the inference that the testator meant the revocation
of the old to depend upon the efficacy of the new
disposition intended to be substituted, the revocation
will be conditional and dependent upon the efficacy
of the new disposition; and if for any reason, the new
will intended to be made as a substitute is
inoperative, the revocation fails and the original will
remain in full force (Vda. De Molo v. Molo, G.R. No.
L-2538, September 21, 1951).
The earlier will can still be admitted to probate under
the principle of "dependent relative revocation". The
theory on which this principle is predicated is that the
testator did not intend to die intestate. And this
intention is clearly manifest where he executed two
wills on two different occasions (Vda. de Molo v.
Molo, G.R. No. L-2538, September 21, 1951).
REVOCATION BY MISTAKE
A revocation of a will based on a false cause or an
illegal cause is null and void (CIVIL CODE, Art. 833).
The false or illegal cause must appear upon the face
of the will.
However, where the facts alleged by the testator
were peculiarly within his knowledge, or the testator
must have known the truth of the facts alleged by
him, it does not matter whether they are true or not;
the revocation is absolute (3 TOLENTINO, supra at
142).
NOTE: The recognition of an illegitimate child does
not lose its legal effect, even though the will wherein
it was made should be revoked (CIVIL CODE, Art.
834). The revoked will is still an "authenticated
writing" under Art. 278.
Illustration: X instituted Y, his friend, as heir for the
free portion of his estate. X then revoked the will.
May Y subsequently contest the will?
“I revoke the will for Y”
“I revoke the will for Y as he is already dead”
“I revoke the will for Y because we are not
friends anymore”
Answer: Yes, but only in so far as reason “B” (or for
the reason that he is dead) for being untrue. In such
case, the revocation is null and void, and will not take
effect.

REPUBLICATION AND
REVIVAL OF WILLS
(ARTS. 835-837)
REPUBLICATION
It is an act of the testator whereby he reproduces in
a subsequent will the dispositions contained in a
previous will which is void as to its form or executes
a codicil to his will (JURADO, Succession, supra at
132).
KINDS:
1. Express or Republication by Re-execution
(CIVIL CODE, Art. 835)
If the testator reproduces in a subsequent will
dispositions contained in a previous one which
is void as to its form. The purpose of
republication is to cure the will of its formal
defects.
2. Constructive or Republication by Reference
(CIVIL CODE, Art. 836)
If the testator for some reason or another
executes a codicil to his will.
NOTE: Art. 836 must be considered as the general
rule and Art. 835 as the exception. Reproduction in
the codicil is required only when the original will is
void as to its form; in all other cases, reference to the
original will suffice to republish it through the codicil.
Thus, a codicil may republish and validate a will
which was originally void for want of testamentary
capacity or on account of undue influence upon the
testator (3 TOLENTINO, supra at 144).
Illustration: X made a will in 2010 but only two
witnesses were present. In 2018, he modified the will
by a codicil. If he dies, should the will be allowed?
Answer: No. The 1985 will was void as to its form
because it only has two witnesses and therefore Art.
835 should apply. The testator must reproduce in a
subsequent will the dispositions contained in the
1985 will. He cannot merely use a codicil.
NOTE: The word “form” in Art. 837 refers to those
covered by Art. 805 like defect in the number of
witnesses, lack of or fatal defect in the attestation,
lack of acknowledgement etc., but not to vitiated
consent or to lack of testamentary capacity (3
PARAS, supra at 152).
EFFECTS OF REPUBLICATION BY
VIRTUE OF A CODICIL:
1. Codicil revives the previous will (DE LEON,
Succession, supra at 197); and
2. The old will is republished as of the date of the
codicil, and makes it effective, as it were, from
the new and later date (3 PARAS, supra at 210).
3. A will republished by a codicil is governed by a
statute enacted subsequent to the execution of
the will, but which was operative when the codicil
was executed (Id.).
REVIVAL
Restoration to validity of a previously revoked will by
operation of law (JURADO, Succession, supra at
133).
REPUBLICATION V. REVIVAL
REPUBLICATION REVIVAL
As to How It Takes Place
Takes place by an act Takes place by
of the testator operation of law
As to Purpose
Corrects extrinsic and
Restores a revoked will
intrinsic defects.
(Id. at 133).
EXAMPLES OF REVIVAL
1. While omission of a compulsory heir in the
institution of heirs annuls the institution, still if the
omitted heir dies ahead of the testator, the
institution is revived, without prejudice to the
right of representation (CIVIL CODE, Art. 854).
2. If after making a will, the testator makes a
second will impliedly revoking the first, the
revocation of the second will revives the first will
as implied from Art. 837 (3 PARAS, supra at
153).
KINDS:
1. Express Revocation of the First Will
If after making a will, the testator makes a
second will expressly revoking the first, the
revocation of the second will does not revive the
first will, which can be revived only by another
will or codicil (CIVIL CODE, Art. 837).
2. Implied Revocation of the First Will
Where there is merely an inconsistency between
two wills, but there is no revocatory clause, upon
destruction of the second will, the first is
automatically revived, regardless of the
intention of the testator, provided that the first
 will has been preserved undestroyed (JURADO,
Succession, supra at 133).
Illustration: Suppose, however, that instead of
an express revocatory clause, the dispositions
found in the second will are merely
INCONSISTENT with those found in the first —
shall the express revocation of the second will
by a third will or a codicil result in the revival of
the first will?
Answer: The Code does not provide for the
effect of the revocation of the second will in case
the second will merely impliedly revoked the first
will (Id.).
NOTE: If the revoking will be disallowed
because it is not valid, it cannot produce the
effect of annulling the previous will (Samson v.
Naval, G.R. No. 11823; February 11, 1918).
Illustration: Assuming that Will No. 1 was
expressly revoked by Will No. 2, Will No. 2 was
subsequently revoked by Will No. 3. What is the
effect of the revocation of Will No. 2 if Will No. 3
contains a revocatory clause but no
testamentary disposition and how will the estate
be distributed?
Answer: The estate would be distributed as if
the decedent died intestate. A will (Will No. 1)
expressly revoked by a 2nd will (Will No. 2)
cannot be revived by the revocation of the will
(Will No. 3) revoking it (Will No. 2). (CIVIL
CODE, Arts. 837 in relation to Arts. 830, par. 2
and 960, par. 1).
PRINCIPLE OF INSTANTER
When there is an express revocation of the first will
by the second will, the third will cannot revive the
first will. Express revocation is always final and
executory.
The revoking clause in the second will is not
testamentary in character, but operates to revoke
the prior will upon the execution of the will
containing it; hence, the revocation of the second
will does not revive the first will which has already
become a nullity (3 TOLENTINO, supra at 144-
145).
ALLOWANCE AND
DISALLOWANCE OF
WILLS
(ARTS. 838-839)
PROBATE
A special proceeding mandatorily required for the
purpose of establishing the validity of a will. The
procedure to be followed is that which is provided for
in the New Rules of Court (JURADO, supra at 134-
135).
NOTE: Probate is one thing; the validity of the
testamentary provision is another. The first decides
the execution of the document and the testamentary
capacity of the testator; the second deals with
descent and distribution (Sumilang v. Ramagosa,
G.R. No. L-23135, December 26, 1967).
WHEN PROBATE IS COMMENCED
1. Ante Mortem; during the lifetime of the
testator
– The testator himself may, during his lifetime,
petition the court having jurisdiction for the
allowance of his will (CIVIL CODE, Art. 838).
NOTE: After a will has been probated during the
lifetime of the testator, it does not necessarily
mean that he cannot alter or revoke the same
before his death (Maloles II v. De los Reyes,
G.R. Nos. 129505 & 133359, January 31, 2000).
2. Post Mortem; after the death of the
testator
– By any person interested in the estate.
NOTE: Formal validity is the only legal issue in
probate of a will (DE LEON, Succession, supra at
200).
It is not necessary that the original of the will be
attached to the petition [for probate]. That the
annexing of the original will to the petition is not a
jurisdictional requirement is clearly evident in
Section 1, Rule 76 of the Rules of Court which allows
the filing of a petition for probate by the person
named therein regardless of whether or not he is in
possession of the will, or the same is lost or
destroyed (Heirs of Fran v. Salas, G.R. No. 53546,
June 25, 1992).
If the holographic will has been lost or destroyed and
no other copy is available, the will cannot be
probated because the best and only evidence is the
handwriting of the testator in said will. However, a
photostatic copy or xerox copy of the holographic will
may be allowed because comparison can be made
with the standard writings of the testator(In Re:
Bonilla v. Aranza, G.R. No. L-58509, December 7,
1982).
NECESSITY OF PROBATE
1. The law expressly requires it. No will shall pass
either real or personal property unless it is
proved and allowed in accordance with the
Rules of Court (CIVIL CODE, Art. 838). Even if
only one heir has been instituted, there must still
be the judicial order of adjudication (Lopez v.
Gonzaga, G.R. No. L-18788, January 31, 1964).
2. Probate is a proceeding in rem and therefore
cannot be dispensed with or substituted by any
other proceeding, judicial or extrajudicial without
offending public policy (JURADO, Succession,
supra at 135).
3. The right of a person to dispose of his property
by virtue of a will may be rendered nugatory (In
the matter of the Testate Estate of the late
Agustin Del Valle, G.R. No. L-11609, September
24, 1959); and
4. Because absent legatees and devises, or such
of them as may have no knowledge of the will,
could be cheated of their inheritance thru the
conclusion of some of the heirs who might agree
to the partition of the estate among themselves
to the exclusion of others (In the matter of the
Testate Estate of the late Agustin Del Valle, G.R.
No. L-11609, September 24, 1959).
VENUE:
1. Resident citizen or alien
– RTC in the province in which he resides at the
time of his death.
2. Non-resident citizen or alien
– RTC in which his estate is located (RULES OF
COURT, Rule 73, Sec. 1).
Residence
Actual or physical place of abode of the deceased as
distinguished from his legal residence or domicile
(Fule v. CA, G.R. no. L-40502, November 29, 1976).
NOTE: The first court taking cognizance of the
settlement of the estate of a decedent shall exercise
jurisdiction to the exclusion of all other courts
(RULES OF COURT, Rule 73, Sec.1).
IMPRESCRIPTIBILITY OF PROBATE
The statute of limitations is not applicable to probate
of wills (JURADO, Succession, supra at 137).
RATIONALE: Probate proceedings are not
established in the interest of the surviving heirs, but
primarily for the protection of the expressed wishes
of the testator (Id.).
It is true that the rights of the parties should not be
left hanging in uncertainty for periods in excess of
the maximum period of ten (10) years allowed by
law, but the remedy is for the other interested person
either:
1. To petition for the production of the will and for
its probate (Id.);
2. To inflict upon the guilty party the penalties
prescribed by Rule 75 of the Rules of Court (Id.);
or
3. To declare the unworthiness of the heir under
Art. 1032 of the Civil Code for concealing or
suppressing the will (Guevara v. Guevara, G.R.
No. L-5405, January 31, 1956).
The will and the codicil may or may not be probated
simultaneously.
One who has or can have no interest in succeeding
a decedent cannot oppose the probate of his alleged
will (Butiong v. Surigao Consolidated Mining, G.R.
No. L-13938, July 31, 1968).
ESTOPPEL NOT APPLICABLE TO
PROBATE PROCEEDINGS
The rule of estoppel does not apply to probate
proceedings for they are invested with public
interest, and if estoppels would be applied, the
ascertainment of the truth may be blocked (Alsua-
Betts v. Court of Appeals, G.R. No. L-46430, July 30,
1979).
EFFECT OF ALLOWANCE OF WILL
A judgment or decree of a court with jurisdiction to
probate a will is:
1. Conclusive as to the validity of the will;
NOTE: Especially the testamentary capacity
and due execution of the will (3 PARAS, supra
at 164).
2. Not subject to collateral attack, but stands as
final, if not modified, set aside, or revoked by a
direct proceeding, or reversed on appeal to a
higher court; and
3. Conclusive to the whole world (JURADO,
Succession, supra at 142).
NOTE: Formal notice is an idle ceremony where the
adverse party had actual knowledge.
Fraud as a ground for relief must be based on
extrinsic fraud.
Where part of the estate is not distributed, recourse
is not to re-open probate proceedings, but motion for
execution or action for reconveyance (Heirs of the
Late Jesus Fran v. Salas, G.R. No. L-53546, June
25, 1992).
INSTANCES WHEN ALLOWANCE MAY
BE SET ASIDE
GENERAL RULE: Since a proceeding for the
probate of a will is essentially one in rem, a judgment
allowing a will shall be conclusive as to its due
execution (JURADO, Succession, supra at 144).
EXCEPTIONS: (ARSA)
1. By means of an Appeal (CIVIL CODE, Art. 838
par. 4);
2. By means of a petition for Relief from judgment
by reason of fraud, accident, mistake, or
excusable negligence (RULES OF COURT,
Rule 38, Sec. 2);
3. By means of a petition to Set aside the judgment
by reason of lack of jurisdiction or lack of
procedural due process; or
4. By means of an action to Annul judgment by
reason of extrinsic or collateral fraud (JURADO,
Succession, supra at 144).
SCOPE OF PROBATE PROCEEDINGS
GENERAL RULE: In probate proceedings, the
probate court cannot inquire into the intrinsic validity
of testamentary provisions. The only questions that
may be determined by the probate court are the
following: (ICE)
1. Identity of the will (whether the will presented is
the last will and testament of the testator);
2. Testamentary Capacity of the testator at the
time of the execution of the will; and
3. Due Execution of the will (whether there was
compliance with the requisites and solemnities
prescribed by law (Id. at 138-139).
NOTE: The probate or administration court may
decide prima facie the ownership of the property, but
such determination is not final and is without
prejudice to the right of interested parties to ventilate
the question of ownership in a proper action (Teng
v. Ting, G.R. No. 184237, September 21, 2016).
The [probate] court had jurisdiction to act in the
intestate proceedings with the caveat that, due to its
limited jurisdiction, it could resolve questions of title
only provisionally. It is hornbook doctrine that "in a
special proceeding for the probate of a will, the
question of ownership is an extraneous matter which
the probate court cannot resolve with
finality (Sanchez v. Court of Appeals, G.R. No.
108947, September 29, 1997).
EXCEPTION: Practical considerations
In Reyes v. Court of Appeals (G.R. No. 12099,
October 30, 1997), the Supreme Court held that,
when the defect of the will is apparent on its face and
the probate of the will may become a useless
ceremony if it is intrinsically invalid. The intrinsic
validity of a will may be passed upon because
"practical considerations" demanded it as when
there is preterition of heirs or the testamentary
provisions are of doubtful legality. Where the parties
agree that the intrinsic validity be first determined,
the probate court may also do so.
In Nuguid v. Nuguid (G.R. No. L-23445, June 23,
1966), the Supreme Court held that, if the case was
to be remanded for probate of the will, nothing will
be gained. On the contrary, this litigation would be
protracted. And for aught that appears in the record,
in the event of probate or if the court rejects the will,
probability exists that the case will come up once
again before us on the same issue of the intrinsic
validity or nullity of the will – thus resulting to a waste
of time, effort, expense, plus added anxiety.
In Nepomuceno v. CA (G.R. No. L-62952, October
9, 1985), the Court ruled that “the court can inquire
as to the intrinsic validity of the will because there
was an express statement that the beneficiary was
a mistress. In Article III of the disputed Will, the
testator stated that respondent was his legal wife
from whom he had been estranged "for so many
years." In Article IV, he stated that he had been living
as man and wife with the petitioner since 1952.
There is no question about the fact of a prior existing
marriage when the testator executed his Will. There
is also no dispute that the petitioner and Mr. Jugo
lived together in an ostensible marital relationship for
22 years until his death.
Criminal action will not lie against the forger of a will
which had been duly admitted to probate by a court
of competent jurisdiction (Mercado v. Santos, G.R.
No. 45629, September 22, 1938).
The fact that the will has been allowed without
opposition and the order allowing the same has
become final and executory is not a bar to the
presentation of a codicil provided it complies with all
the formalities for executing a will. It is not
necessary that the will and codicil be probated
together as the codicil may be concealed by an
interested party. They may be probated one after the
other (Macam v. Gatmaitan, G.R. No. 40445, August
17, 1934).
The Probate Court may pass upon the title to a
property, but such determination is provisional, not
conclusive, and is subject to the final decision in a
separate action to resolve title (Valero Vda. de
Rodriguez vs. Court of Appeals, G.R. No. L-39532,
July 20, 1979).
GROUNDS FOR DISALLOWANCE OF A depriving the latter of a reasonable freedom of
WILL: (F2UMIS) choice (CIVIL CODE, Art. 1337).
1. Formalities required by law have not been
Fair arguments, persuasion, appeal to emotions,
complied with;
and entreaties which, without fraud or deceit or
2. Will was executed through Force or under
actual coercion, compulsion or restraint do not
duress, or the influence of fear, or threats;
constitute undue influence sufficient to invalidate a
3. Will was procured by Undue and improper
will (Barreto v. Reyes, G.R. No. L-5830, January 31,
pressure and influence on the part of the
1956).
beneficiary or of some other person;
4. Testator acted by Mistake or did not intend that
To be sufficient to avoid a will, the influence exerted
the instrument he signed should be his will at the
must be of a kind that so overpowers and subjugates
time of affixing his signature thereto;
the mind of the testator as to destroy his free agency
5. Testator was Insane, or otherwise mentally
and make him express the will of another rather than
incapable of making a will, at the time of its
his own (Pascual v. De la Cruz, G.R. No. L-24819,
execution; and
May 30, 1969).
6. Signature of the testator was procured by fraud
(CIVIL CODE, Art. 839).
The contention that a will was obtained by undue
influence or improper pressure cannot be sustained
NOTE: The list is exclusive (Ajero v. CA, G.R. No.
on mere conjecture or mere suspicion, as it is not
106720 September 15, 1994).
enough that there was an opportunity or a possibility
to exercise undue influence, or that it might have
If any of the above grounds for disallowance is
been exercised (Pascual v. De la Cruz, G.R. No. L-
proved, the will shall be set aside as void. Even if the
24819, May 30, 1969).
grounds for disallowance is that the testator was not
of sound mind or below 18 at the time of the
Allegations of fraud and undue influence cannot co–
execution of the will, the will shall be void and not
exist because they mutually oppose and exclude
merely voidable (1 RABUYA, supra at 820).
each other that their joining as grounds for opposing
probate shows absence of definite evidence against
NOTE: Article 834 of the Civil Code which provides
the validity of the will (Icasiano v. Icasiano, G.R. No.
that the recognition of an illegitimate child does not
L-18979, June 30, 1964).
lose its legal effect, even though the will wherein it
was made should be revoked - shall likewise apply
to a disallowed will. REVOCATION V. DISALLOWANCE
REVOCATION DISALLOWANCE
Violence – there is violence when in order to wrest
consent, serious or irresistible force is employed As to the Nature of the Act
upon the testator (CIVIL CODE, Art. 1335).
Voluntary act of the Given by judicial
Intimidation – when the testator is compelled by a testator. decree.
reasonable and well-grounded fear of an imminent
As to the Need for a Legal Cause
and grave evil upon his person or property, or upon
the person or property of his spouse, descendants With or without cause. Must always be for a
or ascendants, to execute the will (CIVIL CODE, Art. legal cause.
1335).

Mistake –pertains to “Mistakes of Execution” which As to Whether It Can Be Partial or Total

may either be:
1. A mistake as to identity or character of the May be partial or total. Always total except:
instrument which he signed; or when the ground of
2. A mistake as to the contents of the will itself fraud or influence for
(JURADO, Succession, supra at 158). example affects only
certain portions of the
Fraud – if by misrepresentation and deception the will.
testator is led into making a will different from that he
would have made but for the misrepresentation and As to When it Takes Place
deception (Id. at 157). Take place during the Disallowance is usually
lifetime of the testator. invoked after the
Undue Influence – when a person takes improper testator’s death.
advantage of his power over the will of another,
(DE LEON, Succession, supra at 232).
RATIFICATION
1. Ratification is not possible
– With respect to a will which does not comply
with the formalities prescribed by law (CIVIL
CODE, Art. 839 pars. 1-2; JURADO,
Succession, supra at 158). This is because a
void will cannot be ratified.
2. Ratification is possible
– With respect to a will which was executed
through violence, intimidation, undue influence,
fraud or mistake (CIVIL CODE, Art. 839 pars. 3-
6 (Id.).
INSTITUTION OF HEIRS
(ARTS. 840-856)
INSTITUTION
An act by virtue of which a testator designates in his
will the person or persons who are to succeed him in
his property and transmissible rights and obligations
(CIVIL CODE, Art. 840).
NOTE: A child already conceived at the time of the
death of the decedent is capable of succeeding
provided it be born later under the conditions
prescribed in Article 41 (CIVIL CODE, Art. 1025,
par.2).
For civil purposes, the fetus is considered born if it is
alive at the time it is completely delivered from the
mother’s womb. However, if the fetus had an intra-
uterine life of less than seven months, it is not
deemed born if it dies within twenty-four hours after
its complete delivery from the maternal womb (CIVIL
CODE, Art. 41).
FUNDAMENTAL BASIS OF THE LAW OF
TESTAMENTARY SUCCESSION
The doctrine that the will of the testator, freely
expressed in his last will and testament, is, as a
general rule, the supreme law which governs the
succession (JURADO, Succession, supra at 159).
ORDER OF PREFERENCE: (ISRAI)
1. Institution of heir (CIVIL CODE, Art. 840);
2. Substitution of heir (CIVIL CODE, Art. 857);
3. Right of Representation (CIVIL CODE, Art. 970);
4. Right of Accretion (CIVIL CODE, Art. 1015); and
5. Intestacy (CIVIL CODE, Art. 960)
REQUISITES FOR A VALID
INSTITUTION:
1. The will must be extrinsically valid, meaning:
a. The testator must be capacitated;
b. The formalities must be observed;
c. There must be no vitiated consent;
d. The will must have been duly probated; and
e. The will must have been the personal act of
the testator.
2. The institution must be intrinsically valid,
meaning:
a. The legitime must not be impaired;
b. The heir must be certain or ascertainable;
and
c. There should be no preterition.
3. The institution must be effective, meaning:
a. There must be no predeceased heir;
b. There must be no repudiation by the heir;
and
c. There must be no incapacity of the heir
(3 PARAS, supra at 197).
LACK OF INSTITUTION DOES NOT
INVALIDATE A WILL
A will is valid, even though:
1. It does not contain an institution of an heir;
2. The institution does not comprise the entire
estate; or
3. The heir instituted does not accept the
inheritance or is incapacitated to succeed (CIVIL
CODE, Art. 841).
The testamentary dispositions made in accordance
with the law shall be complied with and the
remainder of the estate shall pass to the legal heirs
(CIVIL CODE, Art. 841). In other words, there is
mixed succession.
FREEDOM OF DISPOSITION (CIVIL
CODE, ART. 842):
1. If the testator has no compulsory heirs, his
freedom of disposition is absolute in character.
The whole estate is disposable.
NOTE: The testator must still respect the
restriction imposed by special laws (Arayata v.
Joya, G.R. No. 28067; March 10, 1928).
2. If the testator has compulsory heirs, his freedom
of disposition shall extend only to the disposable
free portion of his estate, but not to the legal
portion or legitime (JURADO, Succession, supra
at 162).
REASON: Under our system of compulsory
succession, there is always a portion of the
testator’s estate known as the legitime which is
reserved by operation of law for the benefit of certain
heirs who are therefore called compulsory heirs, and
over which the testator as a general rule can have
no testamentary control (Id. at p.161).
RESTRICTIONS ON DISPOSITION:
1. The estate of the testator shall be liable for the
latter’s obligations; and
2. The testator cannot dispose of or encumber the
legitime of the compulsory heirs (DE LEON,
Succession, supra at 235).
FORMS OF INSTITUTION:
The testator shall designate the heir by his name and
surname. However, this form is not mandatory. The
designation may be made in any other form, as long
as there will be no doubt as to the identity of the
heir/s instituted (CIVIL CODE, Art. 843).
Dispositions in favor of an unknown person (persona
incierta) shall be void, unless by some event or
circumstances his identity becomes certain (CIVIL
CODE, Art. 845).
NOTE: A persona incierta is one who is not
determined or individualized, thus making it
impossible to know who is meant by the decedent (3
TOLENTINO, supra at 176).
An “Unknown Person” means one who cannot be
identified from the will; not one who is a stranger to
the testator (Id.).
The institution of an unknown person will still be void
even if by some future event he can be determined
when the determination of the heir is delegated by
the testator to another. It is void under Art. 785 of the
Civil Code (3 TOLENTINO, supra at 177).
A disposition in favor of a definite class or group of
persons shall be valid (CIVIL CODE, Art. 845).
SPECIAL KINDS OF CLASS
INSTITUTIONS
1. Poor in General (CIVIL CODE, Art. 1030)
2. Relatives of the Testator (CIVIL CODE, Art. 959)
3. A Person and his Children (CIVIL CODE, Art.
849)
4. Brothers and Sisters of the Full and Half-Blood
(CIVIL CODE, Art. 848)
5. Institution of descendants and relatives of a
legatee
NOTE: The rule of nearest excludes the farther will
not apply here. Therefore, all the descendants and
relatives will inherit per capita (Belen v. BPI, G.R.
No. L-14474; October 31, 1960).
TEST TO DETERMINE THE VALIDITY OF
INSTITUTION
The proper test in order to determine the validity of
an institution of heir is the possibility of finally
ascertaining the identity of the instituted heir either
by intrinsic or extrinsic evidence (JURADO, supra at
163).
The test is specifically applicable to the following
cases:
1. If the name and surname of the instituted heir
has been omitted by the testator (CIVIL CODE,
Art. 843);
2. If there has been an error with respect to the
name, surname, or circumstances of the
instituted heirs (CIVIL CODE, Art. 844);
3. If the name, surname, and circumstances of the
instituted heir are the same as those of other
persons (CIVIL CODE, Art. 844); and
4. If an unknown or uncertain person has been
instituted. (CIVIL CODE, Art. 845).
NOTE: If the doubt as to who is instituted cannot be
resolved, then it is the same as if the testator has not
expressed his will (3 TOLENTINO, supra at 173).
PRESUMPTIONS ON INSTITUTION OF
HEIRS: (EIS)
1. Presumption of Equality
When heirs were instituted without designation
of shares, they are deemed to inherit in equal
parts (CIVIL CODE, Art. 846).
NOTE: This applies only when all of the heirs are
of the same class or juridical condition. The
proper interpretation is that: if the testator has no
compulsory heirs, apply the provision literally;
however, if he has compulsory heirs, first satisfy
their legitime, then apply the rule with respect to
the disposable free portion (JURADO,
Succession, supra at 165-166).
Illustration: X stated in his will: “I give A, B, and
C as my heirs, my entire estate.” The net value
of the estate is P120,000. How much is each
entitled?
Answer: A, B, and C shall equally divide the
P120,000. Hence, each shall be entitled to
P40,000 (CIVIL CODE, Art. 846).
2. Presumption of Individuality
When the testator institutes some heirs
individually and others collectively, those
collectively designated shall be considered as
individually instituted, unless it clearly appears
that the intention of the testator was otherwise
(CIVIL CODE, Art. 847).
 Illustration: Testator said in his will: “I hereby
give my entire estate to A and B and the children
of C (D and E).” The net value of the estate is
P120,000. How much will each be entitled?
Answer: A, B, D, and E shall be entitled to
P30,000 each (CIVIL CODE, Art. 847).
3. Presumption of Simultaneity
When the testator calls to the succession a
person and his children, they are all deemed to
have been instituted simultaneously and not
successively (CIVIL CODE, Art. 849).
NOTE: “His children” refers not to the children
of the testator but to the children of the person
instituted as an heir (3 PARAS, supra at 210).
Illustration: Testator said in his will: “I hereby
give my entire estate to C and his children, D
and E. The net value of the estate is P120,000.
How much will each be entitled?
Answer: C, D, and E shall each get P40,000
(CIVIL CODE, Art. 849).
INSTITUTION OF BROTHERS AND
SISTERS
In case some of full blood and others of half-blood:
1. Testate Succession
The inheritance shall be distributed equally,
unless a different intention appears (CIVIL
CODE, Art. 848).
2. Intestate Succession
Brothers and sisters of the full blood shall be
entitled to a share double that of the brothers
and sisters of the half-blood (CIVIL CODE, Art.
1006).
INSTITUTION BASED ON A FALSE
CAUSE (CIVIL CODE, ART. 850)
GENERAL RULE: The statement of a false cause
for the institution of an heir shall be considered as
NOT written.
Illustration: “I hereby institute my student X as my
heir for having topped the bar examination of 2018.”
If X was not the top-notcher, would he still inherit?
Answer: Yes, because the false cause or reason is
considered as not written.
REASON FOR THE LAW: The real cause is the
testator’s liberality, the mention of the bar topping
being merely incidental, for even if had X topped the
bar, the testator would not have been bound to
reward him, were it not for the provision in the will.
EXCEPTION: When it appears from the will that the
testator would not have made the institution if he had
known the falsity of such cause (CIVIL CODE, Art.
850).
REQUISITES FOR THE ANNULMENT OF
INSTITUTION OF HEIRS: (SF2)
1. Cause of institution of the heirs must be Stated
in the will;
2. Cause must be shown to be False; and
3. It must appear from the Face of the will that the
testator would not have made the institution had
he known the falsity of the cause (Austria v.
Reyes, G.R. No. L-23079, February 27, 1970).
INSTITUTION IN ALIQUOT PARTS:
1. Rule if the entire inheritance is not
covered:
a. Testator has no intention to make heirs as
sole heirs– mixed succession (CIVIL CODE,
Art. 851).
Example:
A= 2/5; B=1/5; C= 1/5
The remainder of 1/5 shall pass to the legal
heirs.
b. Testator intends to make the heirs as sole
heirs– each part shall be increased
proportionately (CIVIL CODE, Art. 852).
It is, therefore, evident that the rule stated in
Art. 852 constitutes an EXCEPTION to the
rule stated in the second paragraph of Art.
851. It enunciates the principle that when
there is a conflict between the intention of
the testator and his mathematical
computation, the former shall prevail
(JURADO, Succession, supra at 171).
2. Rule if the parts together exceed the
inheritance
Each part shall be reduced proportionately.
(CIVIL CODE, Art. 853.)
Formula of Share:
(Aggregate Amount of the Estate x Amount of
Share) ÷ Total Amount of Share
ILLUSTRATION OF INSTITUTION OF
HEIRS UNDER ARTS. 852 AND 853
1. Testator X stated in his will, “I institute A and B
as my heir. A to ½ and B to ¼ of my estate. The
net value of the estate of X is P120,000. How will
the estate be distributed, assuming that A and B
were intended to be the sole heirs of the whole
estate. (Article 852)
 First step: Compute the aggregate share of all Hence:
heirs (according to the will):
A = 60T - 12T = 48T
A =½ of 120T = 60T B = 30T - 6T = 24T
B = ¼ of 120T = 30T C = 60T - 12T = 48T
TOTAL 90T TOTAL 120T

Second step: Compute the remaining free PRETERITION

portion: Omission in the testator’s will of one, some, or all of
the compulsory heirs in the direct line, whether
Net estate = 120T living at the time of the execution of the will or born
Share (will) = (90T) after the death of the testator (CIVIL CODE, Art.
TOTAL 30T 854).
Third step: Distribute proportionately among the It is essential that the omission of the compulsory
heirs: heir must be complete and total in character so that
he receives nothing from the testator at all.
A= 60T x 30T = 20T Consequently, if the testator leaves any property to
90T the heir who is alleged to have been omitted by any
title whatsoever, there can be no preterition
B= 30T x 30T = 10T (JURADO, Succession, supra at 177).
90T
Requisites: (CTS)
Hence: 1. The heir omitted must be a Compulsory heir in
the direct line, such as:
A = 60T + 20T = 80T a. Legitimate children and descendants (LCD),
B = 30T +10T = 40T with respect to their legitimate parents and
TOTAL 120T ascendants (LPA);
b. LPA, with respect to their LCD;
2. Testator X stated in his will, “I will give A ½ of my c. Illegitimate children (IC);
estate, B ¼ and C ½. The net value of the estate d. Father and mother of IC; and
of X is P120,000. How will the estate be e. Adopted child (AC).
distributed? (Article 853)
2. The omission must be complete and Total in
First step: Compute the aggregate share of all character (that the omitted heir does not and has
heirs (according to the will): not received anything at all from the testator by
any title whatsoever); and
A =½ of 120T = 60T
B = ¼ of 120T = 30T 3. The compulsory heir omitted must Survive the
C = ½ of 120T = 60T testator (JURADO, Succession, supra at 174).
TOTAL 150T
Second step: Compute the excess: NOTE: The grandson born one year after the
decedent’s death has no capacity to succeed,
Net estate = 120T because, at the time of the latter’s death, the
Share (will) = (150T) grandson was not yet born, nor was he even
EXCESS (30T) conceived (CIVIL CODE, Arts. 40 and 41).
Third step: Deduct the excess proportionately The law considers as preterition the omission of
among the heirs: a compulsory heir in the direct line, whether
living at the time of the execution of the will or
A= 60T x 30T =(12T) born after the death of the testator or those born
150T after the execution of the will and before the
death of the testator so long as they are alive at
B= 30T x 30T =(6T) the time of the death of the testator (DE LEON,
150T Succession, supra at 251).
C= 60T x 30T =(12T) There is NO Total Omission when:
150T 1. A devise/legacy has been given to the heir by
the testator;
2. A donation inter vivos has been previously given preterition and when there is no preterition (3
to the heir by the testator; or PARAS, supra at 224).
3. Anything is left from the inheritance which the
heir may get by way of intestacy (DE LEON, PRETERITION V. DISINHERITANCE
Succession, supra at 248-249).
PRETERITION DISINHERITANCE
NOTE: The remedy of the affected heir in these
As to Voluntariness
circumstances is the completion of legitime
under Art. 906 of the Civil Code, in case the Ma be intentional but is Always voluntary.
value of the property received is less than the presumed to be
value of the legitime (JURADO, Succession, involuntary.
supra at 177).
As to Omission
Effects:
1. Preterition annuls the institution of heir; The law presumes that Done with legal cause
there has been merely or reason.
NOTE: Preterition does not annul the institution some mistake or
of heir if the omitted compulsory heir should die oversight.
before the testator. The institution shall be
effectual, without prejudice to the right of As to Nullity
representation (CIVIL CODE, Art. 854, par. 2).
Nullity of the institution Nullity is partial, i.e.,
2. The devises and legacies are valid insofar as
is total resulting in total only insofar as it may
they are not inofficious (CIVIL CODE, Art. 854,
intestacy, saving prejudice the heir
par. 1);
devises and legacies. disinherited.
3. Intestate succession ensues (Id; 3 PARAS,
supra at 221-222). As to Effect
Where a one–sentence will institutes the The omitted compulsory If disinheritance is valid,
petitioner as the sole, universal heir and preterits heir gets his share from the compulsory heir is
the parents of the testatrix, and it contains no the entire estate, i.e., merely restored to his
specific legacies or bequests, such universal not only his share of the legitime, and
institution of petitioner, by itself, is void (Nuguid legitime but also of the testamentary
v. Nuguid, G.R. No. L-23445, June 23, 1966). free portion not dispositions which are
disposed of by way of inofficious are reduced.
NOTE: Omission of the surviving spouse (SS) does devises and legacies.
not constitute preterition. SS is not a compulsory heir
in the direct line. Therefore, the only effect of her As to Heir Affected
omission is a partial annulment of the institution of
heirs to the extent that her legitime is prejudiced; in Compulsory heir in the Compulsory heir may
other words, SS is still entitled to her legitime (DE direct line is omitted. be disinherited though
LEON, Succession, supra at 250). not in the direct line.
(DE LEON, Succession, supra at 254-255).
Omission of the adopted child in the testator's will
constitutes preterition since he is by legal fiction Illustration: A, B and C are the legitimate children
considered a compulsory heir in the direct line. This of X. When X executed his will, he instituted as heir
is clear from the provisions of Arts. 979 and 984 to his entire estate A, B and his friend F. He also
which speak of the share of the adopted child in legal gave G a legacy of 30T. The value of the net estate
or intestate succession (JURADO, supra at 176). is 120T. (a) Is there preterition? (b) What is the effect
of preterition on the institution of heirs? (c) What
REASON: Adopted child has the same rights as that about the legacy given to G? (d) How will the estate
of a legitimate child (R.A. 8552, Sec. 18). be distributed?

NOTE: The share of the compulsory heir omitted in Answer:

a will must first be taken from the part of the estate
not disposed of by the will, if any; if that is not
sufficient, so much as may be necessary must be
taken proportionally from the shares of the other
heirs given to them by will (CIVIL CODE, Art. 855).
This article can apply both to cases when there is
1. There is preterition because C was not
mentioned in the will, nor was he given anything.
2. The institution of F will be annulled.
3. The legacy given to G is effective because it can
be contained within the free portion. In this case,
the free portion is (½ of 120T) 60T. The legacy
 given to G in the amount of 30T can be Step 2: Reduction of the heirs’ shares.
contained therein.
4. The estate will be distributed as follows: Formula:
Voluntary share x Amount to be reduced
Heir/ Aggregate amount of voluntary share
Voluntary Amount
Devisee/ Legitime
Share Received A= (10,000 x 10,000)/ 70,000 = 1,428.57
Legatee
F= (60,000 x 10,000)/ 70,000 = 8, 571.43
A 20,000 10,000 30,000
Therefore:
B 20,000 10,000 30,000
Increase/ Amount
Heir Institution
C 20,000 10,000 30,000 Reduction Received

G 30,000 30,000 A 30,000 -1,428.57 28, 571.43

F Institution is annulled B 12,000 +8,000 20,000

Total 60,000 60,000 120,000 C +20,000 20,000

F 60,000 -8,571.43 51, 428.57

Illustration: Testator has three (3) legitimate
children, A, B, and C. In his will, he provided: “I
hereby give ¼ of my estate to A; 1/10 to B; and ½ of SURVIVAL OF OMITTED HEIR
my estate to my friend F. The net value of the estate It is also an essential condition that the compulsory
is P120T. (a) Is there preterition? (b) How should the heir who is omitted in the testator’s will should
estate be distributed? survive the testator (JURADO, Succession, supra at
180).
Answer:
1. There is no preterition because there is still a If the Omitted Compulsory Heir Dies Before the
portion of the estate from which the share of C Testator
may be taken from. Concurring views
2. The estate shall be distributed as follows: According to the second paragraph of Art. 854, the
institution shall be effectual, but without prejudice to
Under Art. 855: “the share of a child or descendant the right of representation when it properly takes
omitted in a will must first be taken from the part of place. Hence, when there is a surviving
the estate not disposed of by the will, if any; if that is representative of the deceased compulsory heir who
not sufficient, so much as may be necessary must has been omitted in testator’s will, such as a child,
be taken proportionally from the shares of the other the effect is that such child shall succeed to the
compulsory heirs,” hence: legitime which would have gone to the heir omitted
(JURADO, Succession, supra at 180).
Step 1: Determination of the amount to be
reduced. If a compulsory heir who has been preterited dies
before the testator, it is the same as if there had been
Voluntary Total per
Heir Legitime no preterition. However, the right to representation
Share person
should not be lost sight of. If the preterited heir has
A 20,000 10,000 30,000 legitimate children and descendants entitled to
represent him, and they have been also left out of
B 20,000 -- 20,000 the will, the institution shall be annulled just the
same, even if the preterited heir dies before the
C 20,000 -- 20,000 testator (3 TOLENTINO, supra at 190).
F 60,000 60,000
EFFECTS OF PREDECEASE OR
Total per 60,000 70,000 130,000 INCAPACITY
type of 1. Voluntary Heir: Transmits no right to his heirs.
share 2. Compulsory Heir: Transmits to his
representatives his right to the legitime but not
130,000 – 120,000 = 10,000 (Amount to be reduced) to the free portion (CIVIL CODE, Art. 856).
EFFECT OF REPUDIATION
Whether voluntary or compulsory, the heir who
repudiates his inheritance cannot transmit any right
to his own heirs (CIVIL CODE, Art. 856).
NOTE: The rule is absolute.
In case of predecease, incapacity or repudiation, the
vacancy is filled up either by substitution,
representation, accretion, or intestate succession
(JURADO, Succession, supra at 187).
Illustration: Z has an estate amounting to
P500,000. X and Y are legitimate children of Z, while
A is the child of X. Z then instituted X and Y as his
heirs.
1. If X predeceased Z, how will the estate be
distributed?
2. If X repudiated his inheritance, how will the
estate be distributed?
3. In the same case as (1), what if A is an adopted
child?
Answer:
1. A would only be entitled to the amount of
P125,000 (or the amount of the legitime of X
from Z) by right of representation. Y on the other
hand shall receive the amount of P375,000
(P125,000 (Y’s legitime) and P250,000 (from the
free portion)) (in accordance with Articles 856
and 972 of the CIVIL CODE).
2. Y would inherit the whole P500,000 from Z. X
having repudiated his share may not be
represented (CIVIL CODE, Art.977).
3. A would not inherit from Z even by right of
representation. The relationship (by legal fiction)
between A and X does not extend to Z. Thus, Y
would inherit P500, 000 from Z.
SUBSTITUTION OF
HEIRS
(ARTS. 857-870)
SUBSTITUTION
It is the appointment of another heir so that he may
enter into the inheritance in default of or subsequent
to the heir originally instituted (CIVIL CODE, Art.
857).
There may also be substitution of legatees and
devisees (3 PARAS, supra at 228).
GENERAL LIMITATION
If the heir for whom a substitute is appointed is a
compulsory heir, the rule is that the substitution
cannot affect the legitime of such heir (JURADO,
Succession, supra at 189).
PURPOSES:
1. To avoid intestate succession;
2. To prevent the descent of the estate to those
persons to whom the testator does not want to
succeed him in his property; and
3. To give the testator greater freedom to dispose
of his property (3 PARAS, supra at 229).
If there is no statement of the case or cases to which
the substitution refers, the presumption is that it shall
comprise all of the three (CIVIL CODE, Art. 859).
If the testator specifies the particular case when the
substitution shall take place, it is clear that it cannot
take place for any other cause not specified by the
testator. When however, he does not specify any of
these causes, but orders the substitution in general
terms, all of the three causes are deemed included,
i.e., any of the three instances may be a cause for
substitution (3 TOLENTINO, supra at 205).
Illustration: X said in his will “I hereby institute A as
heir and B as substitute in case A predeceased me.
A did not die, but was incapacitated, can B inherit?
Answer: No, since it was expressly stated that the
substitution shall take place only in case A
predeceased X.
EFFECT OF SUBSTITUTION
GENERAL RULE: The substitute shall not only take
over the share that would have passed to the
instituted heir, but he shall be subject to the same
charges and conditions imposed upon such
instituted heir (CIVIL CODE, Art. 862).
REASON: We presume that the testator intended
the substitute to stand on the same footing as the
original heir (3 PARAS, supra at 238).
EXCEPTIONS: (EP)
1. When the testator has Expressly provided the
contrary; and
2. When the charges or conditions are Personally
applicable only to the heir instituted (JURADO,
Succession, supra at 193).
SOME INSTANCES WHEN THE
SUBSTITUTION IS RENDERED
INEFFECTIVE:
1. When the substitute predeceases the testator;
2. When the substitute is incapacitated;
3. When the substitute renounces the inheritance; Answer:
4. When the institution of heir is annulled (e.g., Formula:
preterition); Share of heir x Amount to be shared
5. When the institution or the substitution is Aggregate amount of institution
revoked by the testator; and
6. When a will is void or disallowed or revoked (3 A =½ of 600T = 300T
PARAS, supra at 233). B = ¼ of 600T = 150T
C = ¼ of 600T = 150T
KINDS OF SUBSTITUTION:
1. Simple or Common or Vulgar (CIVIL A= 300T x 150T = 100T
CODE, Art. 859, par. 1) 450T
That which takes place when the testator
designates one or more persons to substitute C= 150T x 150T = 50T
the heir/s instituted in case such heir/s should 450T
die before him, or should not wish to accept the
inheritance, or should be incapacitated to accept Instituted Share from Amount
Heir
the inheritance. Amount Substitution Received

2. Brief or Compendious (CIVIL CODE, Art. A 300T 100T 400T

860)
C 150T
Some commentators make a distinction
between brief and compendious, viz: Total
a. Brief – there are 2 or more persons
designated by the testator to substitute for
only one heir.
b. Compendious – one heir is designated to
take the place of two or more heirs.
The majority of commentators, however, make
no such distinction, and certainly the law uses
the terms interchangeably.
If one of the two is preterited, renounced or
incapacitated, the inheritance accrues to the
original heir and not to the substitute UNLESS
the testator provides otherwise. Substitution will
take place only if all the original heirs are
disqualified (BALANE, Succession, supra at
294).
50T 200T
450T 150T 600T
4. Fideicommissary or Indirect
Substitution
Sustitucion fideicomisoria; That which takes
place when the fiduciary or first heir
instituted is entrusted with the obligation to
preserve and transmit to a second heir the
whole or part of the inheritance provided
such substitution does not go beyond one
degree from the heir originally instituted, and
provided further, that the fiduciary or first
heir and the second heir are living at the
time of the death of the testator (CIVIL
CODE, Arts. 863–865).

Example: X makes the following provision in his

will: “I institute A and B to 1/3 of my estate and
nominate C as their substitute.” If A
predeceases B, the 1/3 portion, upon X’s death
goes to B; there is no substitution by C.
Substitution occurs only if both A and B are
disqualified.

3. Reciprocal (CIVIL CODE, Art. 861) Distinction from simple substitution

Sustitucion reciproca; When 2 or more
persons are not only instituted as heirs, but are
also designated mutually as substitute for each
other.
Illustration: X instituted A to ½ of his estate, B
to ¼ of his estate and C to the remaining ¼. X
designated all of them as reciprocal substitutes
of each other. B predeceased X. The valued of
the estate is 600T. Distribute.
In simple substitution only one inherits; in
fideicommissary, both heirs inherit the property
or right to it simultaneously, although the
enjoyment and possession are successive (3
PARAS, supra at 239).
Requisites of Fideicommissary Substitution:
(ESO)
a. There must be a first heir (fiduciary)
primarily called to the Enjoyment of the
estate.
 He is recognized as an instituted heir, and
not a mere administrator of the property.
The first heir is indeed almost like a
usufructuary, with the right to enjoy the
property. Thus, like a usufructuary, he
cannot alienate the property. But unlike a
usufructuary, he is not required to furnish a
bond. Also, unlike a usufructuary, he is
entitled to a refund of useful improvements
(3 PARAS, supra at 242)
Pending the transmission or delivery, he
(fiduciary) possesses the beneficial
ownership of the property, although the
naked ownership is vested in the
fideicommissary (JURADO, Succession,
supra at 201).
Unless the testator provides otherwise, the
following are the deductions allowed:
i. Legitimate expenses;
ii. Legitimate credits; and
iii. Legitimate improvements (DE LEON,
Succession, supra at 279).
b. There must be a Second heir
(fideicommissary) to whom the property is
transmitted by the first heir.
He is a sort of naked owner. Upon
transmission to him of the property, full
ownership is consolidated in him (3 PARAS,
supra at 244).
The second heir inherits not from the first
heir but from the testator (Perez v.
Garchitorena, G.R. No. L-31703, February
13, 1930). As such, he shall acquire a right
to the succession from the time of the
testator’s death, even though he (second
heir) should die before the fiduciary. His
right shall pass to his heirs (CIVIL CODE,
Art. 866).
Said second heir must be capacitated to
succeed not the first heir but the testator (3
PARAS, supra at 244).
c. An Obligation clearly and expressly
imposed by the testator (fideicomitente)
upon such first heir to preserve the estate
and to transmit it to the second heir.
The obligation to preserve and transmit
must be given clearly and expressly, either
by giving the substitution this name of
“fideicommissary substitution,” or by
imposing upon the first heir the absolute
obligation to deliver the property to a second
heir (CIVIL CODE, Ar. 867, par. 1). If the
obligation is conditional, there is no
fideicommissary substitution (3 PARAS,
supra at 242).
If a mere suggestion, advice, or request is
made instead of an obligation, there is no
fideicommissary substitution. In such case,
there will be a simple institution of the first
heir, and the second heir gets nothing (3
PARAS, supra at 242).
Without the obligation clearly imposing upon
the first heir the preservation of the property
and its transmission to the second heir,
there is no fideicommissary substitution
(Rabadilla v. CA, G.R. No. 113725, June 29,
2000).
The 1st and 2nd heir must be only one degree
apart (CIVIL CODE, Art. 863)
By providing that the substitution shall not
go beyond one degree "from the heir
originally instituted”, the present Code has
obviously followed the interpretation of the
word “degree” as generation. The Code thus
clearly indicates that the second heir must
be related to and be one generation from the
first heir (Ramirez v. Vda. De Ramirez, G.R.
No. L-27952, February, 15, 1982).
Both the fiduciary and fideicommissary must
be living (or at least conceived) at the time
of the death of the testator (CIVIL CODE,
Art. 863).
Limitations of Fideicommissary Substitution:
(LOBE)
1. Fiduciary and fideicommissary must be Living at
the time of the death of the testator;
a. Living – this requisite is defined in Art. 40-41
of the Civil Code
b. Qualified – this requisite is governed by Art.
1024-1034 of the Civil Code
2. Substitution must NOT go beyond One degree
from the heir originally instituted;
2 Views as to the meaning of “one degree”
a. Traditional view (degree of relationship)
– When the law says that the substitution
must not go beyond one degree from the
heir originally instituted, what is meant is
that the fideicommissary substitute must not
be beyond one degree of relationship from
the fiduciary heir. Consequently, only the
child or parent of the latter can be appointed
as fideicommissary heir.
 b. Modern view (designation or
transmission/ llamamiento) – When the
law says that the substitution must not go
beyond one degree from the heir originally
instituted, what is meant is that the
substitution must not extend beyond one
degree of designation from the heir originally
instituted. Consequently, any person,
whether natural or juridical, or any entity not
disqualified by law to inherit from the testator
can be appointed as fideicomissary heir
(JURADO, Succession, supra at 197-198).
By providing that the substitution shall not
go beyond one degree "from the heir
originally instituted”, the present Code has
obviously followed the interpretation of the
word “degree” as generation. The Code thus
clearly indicates that the second heir must
be related to and be one generation from the
first heir (Ramirez v. Vda. De Ramirez, G.R.
No. L-27952, February, 15, 1982).
One degree means one generation (3
PARAS, supra at 244).
A fideicommissary substitution is void if the
first heir is not related in the 1st degree to the
second heir (Ramirez v. Vda. De Ramirez,
supra).
3. Substitution must not Burden the legitime of
compulsory heirs; and
The legitime is expressly reserved for the
compulsory heirs (CIVIL CODE, Art. 886).
4. Substitution must be made Expressly (JURADO,
Succession, supra at 197):
a. By giving it the name of a fideicommissary
substitution; or
b. By imposing upon the fiduciary the absolute
obligation to preserve and to deliver the
property to the fideicommissary.
Time When Inheritance Shall be Transmitted to
the Fideicomissary
1. Time chosen by testator; or
2. If testator does not fix a period, discretion of
fiduciary; or
3. In case of doubt, after the death of fiduciary (Id.
at 202).
Illustration: A, who died in 2006, devised a house
and lot to his friend, F, as fiduciary heir and to G, the
eldest son of F, as fideicommissary substitute or
second heir (F has 3 sons – G, H and I). In 2013, G
died; he was survived by his two legitimate children,
J and K. In 2018, F died intestate survived by his two
remaining sons, H and I, and his two grandchildren
J and K.
1. Who has a right over the house and lot?
2. What if H and I claim their legitime alleging that
the house and lot belongs to their father’s
estate?
Answer:
1. J and K. Upon the death of the testator A, G
acquired a right to succession even though he
predeceased F, the fiduciary. The right of the
second heirs shall pass to his heirs (CIVIL
CODE, Art. 866). J and K being the heirs of G
are entitled to the house and lot.
2. H and I cannot claim their right to legitime over
the house and lot because they do not form part
of the estate of F (their father), the latter being a
fiduciary who merely has usufructuary rights
over the subject property. It is G
(fideicommissary) who holds naked ownership
of the house and lot.
Illustration: T instituted his friend A as fiduciary and
B as fideicommissary. A has 2 sons, B and C. B also
has 2 sons, D and E. B died in 2015, while T died in
2020.
1. Is there a valid fideicommissary substitution?
2. Will A inherit from T?
Answer:
1. No. The law requires that both the fiduciary and
fideicommissary must be living at the time of the
testator’s death (CIVIL CODE, Art. 863). Here,
B, the fideicommissary, predeceased the
testator.
2. Yes. The nullity of the fideicommissary
substitution does not prejudice the validity of the
institution of the heirs first designated; the
fideicommissary clause shall simply be
considered as not written (CIVIL CODE, Art.
868).
When the substitution is conditional, the
fideicommissary has only a mere hope or
expectancy pending the fulfillment of the condition,
but once the condition is fulfilled, the obligation to
transmit or deliver the property arises (JURADO,
Succession, supra at 202).
Fideicomiso
There is really one heir. Between the testator and the
heir was a middle man or agent whose function was
in many cases, to intervene only in order that an
incapacitated person (the heir) could succeed from
the testator (3 PARAS, supra at 249).
VOID SUBSTITUTIONS: (EPIC)
1. Fideicommissary substitutions which are not
made in an Express manner.
2. Provisions which contain a Perpetual prohibition
to alienate, and even a temporary one beyond
the limit fixed in Art. 863.
The prohibition to alienate is good only for 20
years, beyond that is void (CIVIL CODE, Art.
870).
REASONS:
a. To give more impetus to the socialization of
the ownership of property; and
b. To prevent the perpetuation of large
holdings, which give rise to agrarian troubles
(JURADO, Succession, supra at 208).
NOTE: If the period fixed is the lifetime of the
heir, e.g., “as long as he lives,” there would really
be 2 period limitations, whichever comes first:
(1) 20 years, if the heir lives for more than that
period, or (2) the period before the expiration of
20 years, if he dies earlier (DE LEON,
Succession, supra at 285).
Illustration: A was given his legitime in the form
of a house. In the will, A was prohibited to sell
the house within a period of 20 years. Can A sell
the house even before the expiration of said
period?
Answer: Yes. This prohibition, even if less than
20 years, cannot be applied to the legitime
(CIVIL CODE, Art. 904 par. 2; 3 PARAS, supra
at 260).
NOTE: Article 870 does not apply if there is a
fideicommissary substitution, for this must be
governed by Art. 867(2) (Id.).
Article 870 is limited to the free portion, for the
legitime, as a general rule, cannot be burdened
by the testator with any charge, condition or
substitution (DE LEON, Succession, supra at
284).
If it so happens that in addition to the prohibition
to alienate there is a fideicomissary substitution
expressly made, such prohibition shall not only
be limited to twenty years but it shall have to be
complemented by another mandate of the
testator — the obligation of the first heir to
preserve the property for the benefit of the
second heir. Consequently, there can be no
conflict between the provision of this article and
that of No. 2 of Art. 867 (JURADO, Succession,
supra at 208).
3. Those which leave to a person the whole or part
of the hereditary property in order that he may
apply or Invest the same according to secret
instructions communicated to him by the testator
(also called “tacit fideicommissum”); and
4. Those which impose upon the heir the Charge
of paying to various persons successively,
beyond the limit fixed in Art. 863, a certain
income or pension (CIVIL CODE, Art. 867).
Illustration: X instituted F to the free portion of
his estate. X also provided that the land shall be
inalienable for a period of 20 years after his
death. X died in 2008. 10 years after F died
leaving the property to his son, A. After 2 years,
A died, leaving the property to his son B. May B
alienate the property?
Answer: B may alienate the property. While it is
true that only 12 years have passed since the
death of X (the prohibition to alienate is 20
years), B can now alienate the property because
he no longer falls within the “one-degree
limitation” (Art. 867, par.2 in relation to Art. 863).
B is already two degrees away from the heir (F)
originally instituted and is thus not covered by
the same charges and conditions of the
fideicommissary substitution.
NOTE: The nullity of the fideicommissary
substitution does not prejudice the validity of the
institution of the heirs first designated; the
fideicommissary clause shall simply be
considered as not written (CIVIL CODE, Art.
868).
DISPOSITION OF USUFRUCT TO
VARIOUS PERSONS
A provision whereby the testator leaves to a person
the whole or part of the inheritance, and to another
the usufruct, shall be valid. If he gives the usufruct to
various persons, not simultaneously, but
successively, the provisions of Art. 863 shall apply
(CIVIL CODE, Art. 869).
Illustration: X said in his will: “I give my property in
Manila to my friend A, but F will have the usufruct for
10 years; F’s son B for two (2) years; and B’s son C
for two (2) years. Is this valid?
Answer: The usufruct is valid only from F to B. When
it comes to C, the usufruct is no longer valid because
C is already two degrees away from F. Therefore,
after B’s death, the ownership of the property will
now be consolidated to A. C will no longer enjoy the
usufruct.
RIGHTS OF FIDUCIARY: (APD)
1. To Acquire the rights of a usufructuary until
delivery to the fideicommissary;
2. To Possess beneficial ownership pending the
delivery while naked ownership is vested in the
fideicommissary (JURADO, Succession, supra
at 201); and
3. To Deduct the amount of legitimate expenses,
credits, and improvements, save in the case
where the testator has provided otherwise
(CIVIL CODE, Art. 865, par. 2).
“Legitimate expenses” as used in the second
paragraph of Art. 865, refer to those which were
made for the acquisition and preservation of the
property or inheritance.
“Improvements,” on the other hand, refer to
necessary as well as to useful expenses.
Other expenses, such as those for pure luxury
or mere pleasure, are excluded.
NOTE: The amount of the deductions to which
the fiduciary is entitled, however, is not the
actual amount of the expenses, but the increase
in value of the property or inheritance.
Consequently, the property is really preserved
(JURADO, Succession, supra at 202).
NOTE: More can be deducted if so provided by the
testator (Id.). Deterioration caused by the fiduciary’s
malice or negligence must of course be shouldered
by him.
If the property is destroyed by a fortuitous event, the
obligation is generally extinguished (3 PARAS,
supra at 253).
Obligations of Fiduciary: (PDI)
1. To Preserve the inheritance;
2. To Deliver the inheritance;
3. To make an Inventory of the inheritance (DE
LEON, Succession, supra at 278-279).
CONDITIONAL, MODAL
TESTAMENTARY
DISPOSITIONS AND
TESTAMENTARY
DISPOSITIONS WITH A
TERM
(ARTS. 871-885)
FREEDOM OF DISPOSITION
Art. 871 is a restatement of the testator’s freedom of
disposition.
NOTE: Although the article speaks only of institution
of heirs, there is no reason why the provision cannot
be applied to any kind of testamentary disposition.
The institution of an heir may be:
1. Pure or simple;
2. Conditional;
3. For a term; or
4. For a certain purpose or cause (modal)
NOTE: Conditions, terms, and modes are not
presumed; they must be clearly expressed in the will.
Otherwise, they shall be considered pure (3 PARAS,
supra at 265).
LIMITATIONS: (UIM)
1. Principle of Untouchability of the
Legitime
GENERAL RULE: The testator cannot impose
any charge, burden, encumbrance, condition, or
substitution whatsoever upon the legitime of the
compulsory heirs. Should he do so, the same
shall be considered as not imposed (CIVIL
CODE, Art. 872).
EXCEPTION:
The testator can validly impose a prohibition
against the partition of the legitime for a period
not exceeding twenty (20) years (CIVIL CODE,
Art. 1083, par. 1).
There is only one instance under our law where
the testator is allowed to impose a charge upon
the legitime of compulsory heirs and that is when
the testator declares that the hereditary estate
shall not be partitioned for a period which shall
not exceed twenty years. According to Art. 1083
of the Code, this power of the testator to prohibit
the division of the estate applies even to the
legitime of compulsory heirs. (JURADO,
Succession supra at 210).
2. Impossible Conditions
Impossible conditions and those contrary to law
or good customs are considered as not imposed
(CIVIL CODE, Art. 873). It is presumed that the
condition is due to a mistake or oversight, or
merely a whim or caprice of the testator. Such
impossibility is to be determined at the time
when the condition is to be fulfilled (JURADO,
Succession, supra at 211).
Here, the condition is considered void and
unwritten but the institution and testamentary
disposition will be considered as valid (3
PARAS, supra at 266).
A condition is considered impossible if it is not
possible of realization because it is contrary to
either physical, juridical or moral laws
(JURADO, Succession, supra at 211).
Article 1183 provides for the annulment of the
obligation which depends upon impossible
conditions. Article 873 only makes the condition
void, but the disposition remains valid (Id.).
A condition prohibiting the contest of the will is
void (3 TOLENTINO, supra at 229).
3. Prohibitions on Marriage
Rules on Prohibitions on Marriage:
a. Absolute Prohibition
i. To contract first marriage – void
(contrary to good morals and public
policy) (CIVIL CODE, Art. 874).
NOTE: There is no exception here (3
PARAS, supra at 268).
ii. To remarry
GENERAL RULE: Absolute
prohibitions to marry as a condition to be
instituted as an heir are void (CIVIL
CODE, Art. 874, par. 1).
EXCEPTIONS:
(1) When imposed on the widow or
widower by the deceased person; or
(2) When imposed on the widow or
widower by the ascendants or
descendants of the deceased spouse
(CIVIL CODE, Art. 874, par. 1).
An absolute condition not to contract
marriage when validly imposed is
resolutory in character. Even so,
however, the legitime of the surviving
spouse cannot be impaired (BALANE,
Succession, supra at 322).
b. Relative Prohibition
Relative prohibitions on the following are
considered valid unless it becomes so
onerous or burdensome, or the prohibition
really amounts to an absolute one:
i. To contract first marriage; or
ii. To remarry.
If the prohibition is relative with respect to
persons, time or place, the rule does NOT
apply; hence, the prohibition is valid. The
following relative conditions regarding
marriage have been considered as valid and
binding:
i. Generic condition to contract marriage;
ii. Specific condition to contract marriage
with a determinate person; and
iii. Specific condition not to contract
marriage with a determinate person.
Nature of condition when validly
imposed
The absolute condition not to contract
marriage when validly imposed is
resolutory in character.
Relative Conditions Regarding Marriage
It must be noted that the general rule stated
in Art. 874 is applicable only when the
prohibition to contract a first or subsequent
marriage is absolute in character.
Consequently, if the prohibition is relative
with respect to persons, time or place, the
rule does not apply; in other words, the
prohibition or condition is valid (Id. at
219-221).
c. A stopping of a usufruct, allowance, or
personal prestation the moment the heir,
legatee, or devisee marries or remarries is
justified since the law allows their giving for
the time during which the person remains
unmarried or in widowhood (CIVIL CODE,
Art. 874).
d. Disposicion Captatoria
Any disposition made upon the condition
that the heir shall make some provisions in
his will in favor of the testator or of any other
person shall be void (CIVIL CODE, Art. 875,
par. 2).
REASON: It impairs freedom of
testamentary disposition (JURADO,
Succession, supra at 221).
REASONS FOR THE PROHIBITION:
i. The captatoria converts testamentary
grants into contractual transactions;
 ii. It deprives the heir testamentary
freedom;
iii. It gives the testator the power to dispose
mortis causa not only of his property, but
also that of his heir’s (BALANE,
Succession, supra at 322).
NOTE: In Art. 875 (disposicion captatoria),
the testamentary disposition itself is void,
while in Arts. 873 and 874 the condition is
void but the testamentary disposition is valid
because testamentary succession is an act
of liberality and not a contractual agreement
(JURADO, Succession, supra at 221).
e. Conditions imposed by the testator upon the
heirs shall be governed by the rules
established for conditional obligations in all
matters not provided for by the law on
succession (CIVIL CODE, Art. 884).
CONDITION
Any future and uncertain fact or past event unknown
to the parties, upon which the performance of an
obligation depends (CIVIL CODE, Art. 1179).
KINDS OF CONDITION:
1. As to the cause upon which the
fulfillment depends:
a. Potestative – fulfillment depends
exclusively upon the will of the heir, devisee,
or legatee, and must be performed by him
personally. It may either be:
i. Positive – when it consists of the doing
or giving of something.
ii. Negative – when it consists of not doing
or giving anything.
GENERAL RULE: It must be fulfilled as
soon as the heir learns of the testator’s
death.
EXCEPTIONS:
i. If the condition was already complied
with at the time the heir learns of the
testator’s death; and
ii. Constructive compliance – the condition
is deemed fulfilled (CIVIL CODE, Art.
883 par. 2)
Heir must give security to guarantee
(caucion muciana) the return of the value of
property, fruits, and interest, in case of
contravention (BALANE, Succession, supra
at 324).
b. Casual – fulfillment depends exclusively
upon chance and/or upon the will of a third
person.
GENERAL RULE: It may be fulfilled at any
time (before or after the testator’s death),
unless testator provides otherwise.
Qualifications:
If already fulfilled at the time of execution of
will:
i. If testator is unaware of the fact of
fulfillment – it is deemed fulfilled
ii. If testator is aware thereof-
1.) if can no longer be fulfilled again –
deemed fulfilled
2.) if it can be fulfilled again – must be
fulfilled against
c. Mixed – fulfillment depends jointly upon the
will of the heir, devisee, or legatee and upon
chance and/or will of a third person.
2. As to the effects:
a. Suspensive or Ex Die - a condition upon
the fulfillment of which successional rights
are acquired.
The heir should be living and qualified to
succeed both at the time of testator’s death
and at the time of the happening of the event
(CIVIL CODE, Art. 1034 par. 3)
Pending its fulfillment, the estate shall be
placed under administration until the
condition is fulfilled, or it becomes certain
that it cannot be fulfilled (CIVIL CODE, Art.
880, par. 1).
b. Resolutory or In Diem - a condition upon
the fulfillment of which rights already
acquired are extinguished.
If the suspensive condition is not fulfilled or
if the resolutory condition is fulfilled, as the
case may be, the estate shall pass to the
legal heirs (JURADO, Succession, supra at
227).
TERM
It is the day or time when a testamentary disposition
either becomes demandable or terminates (CIVIL
CODE, Art. 1193).
KINDS OF TERM:
1. Suspensive
Rights are suspended until the arrival of the date
or time designated by the testator.
The legal heir shall be considered as called to
the succession until the arrival of the period. But
he shall not enter into possession of property
until after having given sufficient security, with
the intervention of the instituted heir. In the
 absence of a bond, said property shall be under
administration (CIVIL CODE, Art. 885, par. 2).
NOTE: The words “or term” in line 2, and “or until
the arrival of the term” in lines 4 and 5 at the end
of 1st par. of Art. 880 must be eliminated as it
conflicts with Art. 885. In the protoype, Art. 805
(Now Art. 880) was limited to suspensive
conditions only since periods were governed by
Art. 885. However, some unknown person
inserted “or term” in Art. 880 which created a
contradiction (JURADO, Succession, supra at
231).
Other instances where caucion muciana is
required:
a. Art. 885 par. 2, Civil Code; and
b. Art. 882, Civil Code
NOTE: This must not be confused with caucion
juratoria, a bond required in usufruct.
2. If the Condition is Casual or Mixed
It shall be sufficient if it happens or be fulfilled at
any time before or after the death of the testator,
UNLESS he has provided otherwise (CIVIL
CODE, Art. 877, par. 1).

If the heir, devisee or legatee should have died Two Secondary Rules
after the death of the testator, but before the a. If the condition had already been fulfilled at
expiration of the term, his right shall be the time of the execution of the will and the
transmitted to his own heirs (CIVIL CODE, Art. testator was unaware thereof, it shall be
878). deemed to have been complied with.
b. If the condition has already been fulfilled at
2. Resolutory Term the time of the execution of the will and the
Rights are immediately demandable but subject testator had knowledge thereof, the
to extinguishment upon the arrival of the date or condition shall, as a rule, still have to be
time designated by the testator (CIVIL CODE, complied with, unless it is of such a nature
Art. 1193). that it can no longer exist or be complied
with again (JURADO, Succession, supra at
TIME OF FULFILLMENT 223-224).
1. If the Condition is Purely Potestative
a. Positive Potestative Condition TERM V. CONDITION
The heir must fulfill it as soon as he learns CONDITION TERM
of the testator’s death, unless the condition
is already complied with and cannot be As to Uncertainty of an Event
fulfilled again (CIVIL CODE, Art. 876).
An uncertain event Sure to happen or to
which may or may not arrive, even if the exact
b. Negative Potestative Condition happen. date of such happening
The right of the heir, devisee or legatee does or arrival may be
not have to be held in suspense. uncertain.
He acquires his right as a matter of course
without any limitation other than that of not As to the Acquisition of the Right
doing or not giving something (CIVIL CODE,
Art. 879). The acquisition of the The right is already
right depends upon the transmitted to the heir
Caucion Muciana happening of the upon the death of the
The bond or security referred to in Art. 879 is condition, such that if testator; the term
called a caucion muciana (6 Manresa, 6th ed., p. the condition does not merely serves to
201). The bond or security should be given in happen, the heir does determine the
favor of those who would get the property IF the not succeed. demandability of such
condition be not complied with (like the intestate right already acquired.
heirs of the substitute, etc.). The favored (3 TOLENTINO, supra at 236).
persons are naturally the ones who can demand
the constitution of the security (6 Sanchez MODAL INSTITUTION (INSTITUCION
Roman, p. 616).
SUB MODO)
It may be demanded in favor of those to whom Attachment by the testator to an institution of heir, or
the property would pass if not complied (3 to a devise or legacy, of a statement of the:
TOLENTINO, supra at 239). 1. Object of the institution;
1. Application of the property left by testator; or
2. Charge imposed by him (JURADO, Succession,
supra at 228).
That which has been left in this manner may be
claimed at once provided that the instituted heir or
his heirs give security for compliance with the wishes
of the testator and for the return of anything he or
they may receive, together with its fruits and
interests, if he or they should disregard this
obligation (CIVIL CODE, Art. 882, par. 2).
Illustration: X makes a legacy of P1,000,000 to Y
who was instructed to build a house and to deliver
the same to Z. Is there a modal institution?
Answer: Yes, there is a modal institution. There is a
direction to build a house. The answer would be
different however if Y was instructed to use the
money to buy a particular thing as the statement
turns into a condition.
NOTE: In case of doubt, the institution should be
considered modal and not conditional; and where
there is doubt whether a statement is a mode or it is
a mere suggestion, observation, or expression of
certain desires by the testator, it should be
understood in the latter sense (DE LEON,
Succession, supra at 308).
A mode obligates but does not suspend, while a
condition suspends but does not obligate (JURADO,
supra at 228).
DOCTRINE OF CONSTRUCTIVE
FULFILLMENT
When without the fault of the heir, an institucion sub
modo cannot take effect in the exact manner stated
by the testator; it shall be complied with in a manner
most analogous to and in conformity with his wishes
(CIVIL CODE, Art. 883, par. 1).
If the condition is casual, the doctrine is not
applicable since the fulfillment of the event which
constitutes the condition is independent of the will of
the heir, devisee/legatee. If the condition is
potestative or mixed, the doctrine is applicable
(JURADO, Succession, supra at 229).
LEGITIME
(ARTS. 886-914)
LEGITIME
That part of the testator’s property which he cannot
dispose of because the law has reserved it for
certain heirs who are, therefore, called compulsory
heirs (CIVIL CODE, Art. 886).
The Civil Code adheres to the System of Partial
Reservation wherein the inheritance is divided into
the free portion and the legitime. The distribution
may be by law, or by the testator’s will or by both (3
PARAS, supra at 296-297).
PURPOSE OF LEGITIME
To protect the compulsory heirs for whom the
testator is presumed to have a parental, filial or
conjugal obligation to reserve portions of his estate
for the benefit of such heirs from his anger or neglect
(JURADO, Succession, supra at 233).
The cause of action to enforce a legitime accrues
upon the death of the donor-decedent since it is only
then that the net estate may be ascertained and on
which basis, the legitime may be determined
(Imperial v. CA, G.R. No. 112483, October 8, 1999).
PRINCIPAL SYSTEMS OF
DISTRIBUTION OF HEREDITARY
PROPERTY
1. System of Absolute Freedom of
Disposition
The testator may freely dispose of his property
without any limitation imposed by law;
2. System of Total Revocation
The testator cannot freely dispose of any portion
of his estate as long as there are compulsory
heirs for whom the law reserves his estate. He
has free disposition only when he has no
compulsory heirs; and
3. System of Partial Reservation
This is the system of legitime. A certain portion
of the estate is reserved by law for compulsory
heirs and the rest is the free portion over which
the testator has absolute freedom of disposition
(DE LEON, Succession, supra at 317).
KINDS OF LEGITIME:
1. Fixed
The aliquot part of the testator’s estate to which
a certain class of compulsory heirs is entitled by
operation of law is always the same whether
they survive alone or with other classes of
compulsory heirs.
2. Variable
The aliquot part changes depending upon
whether they survive alone or with other classes
of compulsory heirs (JURADO, Succession,
supra at 234).
COMPULSORY HEIRS (CH)
Those heirs for whom the law has reserved that part
of the testator’s estate known as legitime. As such,
testator cannot deprive them of their legitime except
by disinheritance properly effected (JURADO,
Succession, supra at 234-235).
The birth of a compulsory heir gives a vested right to
the heir to acquire the inheritance which is inherent
from his legitimate filiation (Rocha v. Tuason, G.R.
No. 14254, August 5, 1919).
NOTE: The fact of being a compulsory heir imposes
no obligation to accept or receive the legitime. The
law on legitime is a restriction, not on the freedom of
the heir to accept or repudiate the inheritance, but
on the freedom of the testator to dispose of his
property (3 TOLENTINO, supra at 252). They are
called compulsory, only because the testator cannot
disregard them (3 PARAS, supra at 301).
KINDS OF COMPULSORY HEIRS:
1. Primary
Those who are always entitled to their legitime
regardless of the class of compulsory heirs with
which they may concur (e.g., LCD).
2. Secondary
Those who may be excluded by other CH and
succeed only in the absence of the primary CH
(e.g., LPA or IP).
3. Concurring
Those who succeed together with the primary or
secondary CH (e.g., ICD and SS).
NOTE: For illegitimate children to be compulsory
heirs, they must be recognized (3 PARAS, supra at
301). Mere proof of filiation is not enough, what is
important is recognition of that filiation (Noble v.
Noble, G.R. No. 17742, December 17, 1966).
COMPULSORY HEIRS
1. If Testator is a Legitimate Person
a. Legitimate Children and Descendants
(LCD);
b. In default of the foregoing, Legitimate
Parents and Ascendants (LPA);
c. Surviving Spouse (SS);
d. Illegitimate Children and Descendants (ICD)
NOTE: (c) and (d) are NOT excluded by (a) &
(b) neither do they exclude one another
(JURADO, Succession, supra at 234).
2. If Testator is an Illegitimate Person
a. Legitimate Children and Descendants
(LCD);
b. Illegitimate Children and Descendants
(ICD);
c. In default of the foregoing, Illegitimate
Parents (IP) only;
d. Surviving Spouse (SS) (CIVIL CODE, Art.
887).
SUMMARY OF GENERAL RULES
1. Direct descending line
a. Rule of preference between lines
b. Rule of proximity
c. Right of representation ad infinitum in case
of predecease, incapacity, or disinheritance
(If testator is a legitimate person: LCD only
can represent; If testator is an illegitimate
person: both LCD and ICD can represent)
d. If all the LCD repudiate their legitime, the
next generation of LCD succeeds in their
own right.
2. Direct ascending line
a. Rule of division by lines
b. Rule of equal division
3. Non–impairment of legitime
 TABLE OF LEGITIMES

Legends:
LCD = Legitimate Children and Descendants
ICD = Illegitimate Children and Descendants
SS = Surviving Spouse
LPA = Legitimate Parents or Ascendants
IP = Illegitimate Parents
AC = Adopted Child
FP/RFP = Free Portion/Remaining Free Portion

ILLUSTRATION
SURVIVOR LEGITIME NOTES Assume that X’s estate =
P20 million
1. Divide by the # of LCD, whether they survive a. 4 legitimate children –
1/2
alone or with concurring CH. 2.5 million each
LCD (CIVIL CODE,
2. The remaining 1/2 shall be at the free disposal b. FP – 10 million
Art. 888).
of the testator.
1/2; 1. The legitime of the SS shall be taken only from a. Legitimate daughter –
1/4 the free portion (CIVIL CODE, Art. 892). 10 million
1 LCD;
(CIVIL CODE, 2. In case of legal separation, the surviving spouse b. Wife – 5 million
SS
Art. 892, par. may inherit if it was the deceased who had given c. RFP – 5 million
1). cause for the same (CIVIL CODE, Art. 892).
1. Divide 1/2 of the estate by the number of LCD a. 2 legitimate daughters –
1/2; 2. If there are two or more LCD, the legitime of SS 5 million each
Same as that is the same as that of each LCD and it shall be b. Husband – 5 million
2 or more
of each LCD taken from the free portion (CIVIL CODE, Art. c. RFP – 5 million
LCD;
(CIVIL CODE, 892).
SS
Art. 892, par. 3. After deducting the legitime of the SS, the
2). remaining shall be at the free disposal of the
testator.
1. The legitime of the ICD shall be taken from the a. Legitimate son – 10
1/2; free portion (CIVIL CODE, Art. 888). million
1/2 of 1 LCD 2. In case of several IC: b. 5 illegitimate children –
LCD;
(CIVIL CODE, a. If free portion is sufficient, each IC gets 1/2 of 2 million each
ICD
Art. 895, share of 1LCD.
par.1). b. If free portion is insufficient, divide it among
the ICD equally.
1. If there are 2 or more LCD, the legitime of the SS a. 1 legitimate daughter –
is the same as that of each LCD and it shall be 10 million
taken from the free portion (CIVIL CODE, Art. b. Spouse – 5 million
892). c. 4 illegitimate children –
1/2; 2. The legitime of the ICD shall be taken from the 1.25 million each
1/4; free portion provided that the total legitime of
LCD;
1/2 of 1 such ICD shall not exceed the free portion and
SS;
LC(CIVIL that the legitime of the SS must first be fully
ICD
CODE, Art. satisfied (CIVIL CODE, Art. 895, par. 3).
895, Par. 1). 3. In case of several ICD:
a. If free portion is sufficient, each IC gets 1/2 of
1LC.
b. If free portion is insufficient, divide it among
the ICD equally.
1. This rule applies whether they survive alone or If there is no LCD,
1/2
with other classes of CH. a. Legitimate father – 10
LPA (CIVIL CODE,
2. They inherit in default of LCD of testator, million
Art. 889).
otherwise they are excluded.
 ILLUSTRATION
SURVIVOR LEGITIME NOTES Assume that X’s estate =
P20 million
If there is LCD,
a. Legitimate father – none
b. Legitimate son – 10
million
1. The 1/4 to which ICD is entitled is taken from the a. Legitimate mother – 10
1/2; free portion (CIVIL CODE, Art. 896). million
LPA; 1/4 2. The 1/4 shall be divided in equal shares among b. 8 Illegitimate children –
ICD (CIVIL CODE, several ICD. 625,000 each
Art. 896). 3. The remaining 1/4 shall be at the free disposal c. RFP – 5 million
of the testator.
1/2; 1. The legitime of the SS shall be taken from the a. Legitimate mother – 10
LPA; 1/4 free portion. million
SS (CIVIL CODE, 2. The remaining 1/4 shall be at the free disposal b. Spouse – 5 million
Art. 893). of the testator. c. RFP – 5 million
1. The legitime of the SS and ICD shall be taken a. Legitimate father – 10
1/2; from the free portion provided that the total million
LPA; 1/8; legitime of such ICD shall not exceed the free b. Spouse – 2.5 million
SS; 1/4 portion, and that the legitime of the SS must first c. 5 illegitimate children –
ICD (CIVIL CODE, be fully satisfied (CIVIL CODE, Art. 895 par. 3). 1 million each
Art. 899). 2. The remaining 1/8 may be freely disposed of by d. FP – 2.5 million
the testator (CIVIL CODE, Art. 899).
1. If there are more than 1 ICD divide equally a. 10 illegitimate children –
1/2
among them. 1 million each
ICD (CIVIL CODE,
2. The remaining 1/2 shall be at the free disposal b. FP – 10 million
Art. 901).
of the testator.
1/3; The remaining 1/3 shall be at the free disposal of a. Husband – 6.67 million
SS; 1/3 the testator (CIVIL CODE, Art. 894). b. 3 illegitimate children –
ICD (CIVIL CODE, 2.22 million each
Art. 894). c. FP – 6.67 million
1. One third (1/3) if marriage is in articulo mortis If marriage is in
and the testator spouse died within 3 months articulo mortis and
after the marriage. NOTE: Applies only if it was testator dies within 3
the deceased who was the party in danger of months,
death at the time of marriage; and if the cause of a. Spouse – 6.67 million
death is the SAME as the sickness, illness or
injury existing at the time of marriage – the If living together as
1/3;
purpose of the law being to avoid a marriage husband and wife for
1/2;
purely for financial gain. This rule applies only to more than 5 years
SS 1/2
a case of testamentary succession (3 PARAS, before marriage in
(CIVIL CODE,
supra at 350). articulo mortis,
Art. 900).
2. One half (1/2) when they have been living as a. Spouse – 10 million
husband and wife for more than 5 years before b. FP – 10 million
marriage in articulo mortis
3. If marriage is not in articulo mortis, SS shall If marriage is not in
inherit 1/2 of the estate articulo mortis,
4. The remaining one half 1/2 in (b) and (c) herein a. Spouse – 10 million
shall be at the free disposal of the testator b. FP – 10 million
1/2 The remaining 1/2 shall be at the free disposal of a. Illegitimate father – 10
IP (CIVIL CODE, the testator. million
Art. 903). b. FP – 10 million
 ILLUSTRATION
SURVIVOR LEGITIME NOTES Assume that X’s estate =
P20 million
Children inherit in the amounts established in the a. Illegitimate mother –
Excluded; foregoing rules. none
IP;
It depends b. Legitimate son – 10
Any child
(CIVIL CODE, million
(LCD/ICD)
Art. 903). c. Illegitimate daughter – 5
million
IP; Only the parents of IC are included. Grandparents a. Illegitimate father – 5
1/4;
SS and other ascendants are excluded. million
1/4
b. Wife – 5 million
(CIVIL CODE,
c. Illegitimate grandfather
Art. 903).
- none
1/2; When parents (legitimate or illegitimate), or the a. Legitimate parents – 10
LPA/IP of
1/2 legitimate ascendants of the adopted concur with million or 5 million each
the
(FAMILY the adopters, 1/2 shall be inherited by the parents b. Adopters – 10 million
adopted;
CODE, Art. or ascendants and the remaining half by the
Adopters
190, Par. 3). adopters.
Same share As a rule, adopted children are entitled to the same a. Adopted daughter – 2.5
AC; as LCD successional right as legitimate children. million
LCD (CIVIL CODE, b. 3 legitimate sons – 2.5
Art. 979). million each
(JURADO, Succession, supra at 324-325).
Rule of proximity applies where the relative
NOTE: There are conflicting views as to the nearest in degree excludes the more distant
applicability of Art. 190 of the Family Code to ones, saving the right of representation when it
instances where both the adopters and the LP/IP properly takes place (i.e., grandchildren are
concur after the death of the adopted child. excluded by the presence of their parents in the
estate of their grandparents) (CIVIL CODE, Art.
One view is that the Sec. 18 of R.A. 8552 amended 962, par. 1).
the provisions of Art. 190 of the Family Code. Under
Sec. 18, the adopted and his/her parents by nature Rule in case of Adopted Child
may only succeed from each other by way of The adopted shall be deemed to be a legitimate
testamentary succession. The Domestic Adoption child of the adopters (R.A. No. 8552, Sec. 17).

Act extinguished the reciprocal rights of succession
that exist between the two, including the right to the
legitime and rights arising from legal or intestate
succession (RABUYA, The Law on Persons and
Family Relations (2006), p. 616).
Another view is that Art. 190 of the Family Code
continues to apply, and that the adopter and the
LP/IP shall divide the entire estate, that is, one-half
to be inherited by the parents or ascendants and the
other half by the adopters (JURADO, Succession,
supra at 241).
1. LEGITIME OF LEGITIMATE
DESCENDANTS
Consists of 1/2 of the hereditary estate of their
legitimate parents or ascendants, while the other
half is at the latter’s free disposal (CIVIL CODE,
Art. 888).
A ward (ampon), without the benefit of formal
(judicial) adoption, is neither a compulsory nor a
legal heir (Manuel v. Ferrer, G.R. No. 117246,
August 21, 1995).
EXCEPTIONS:
a. When the adoptee and his/her biological
parent(s) had left a will, the law on
testamentary succession shall govern
(FAMILY CODE, Art. 189 in rel. to Secs. 17
and 18 of R.A. No. 8552 or the Domestic
Adoption Act of 1998).
b. When the adopter dies before his LPA, or is
incapacitated to inherit from said LPA, or is
disinherited by his LPA, the adopted cannot
inherit by right of representation (JURADO,
Succession, supra at 236).
 Actio Ad Supplendam Legitimam (Right of
Completion of Legitime)
If some heirs are genuinely interested in
securing that part of their late father’s property
which has been reserved for them in their
capacity as compulsory heirs, then they should
simply exercise their right of completion of
legitime (Gala v. Ellice Agro-Industrial Corp.,
G.R. No. 156819, December 11, 2003).
2. LEGITIME OF LEGITIMATE
ASCENDANTS
Consists of 1/2 of the hereditary estate of their
children and descendants (CIVIL CODE, Art.
889, par. 1).
They are excluded from the succession if they
concur with legitimate children or descendants.
(JURADO, Succession, supra at 244).
Rules of Division for Legitimate Parents and
Ascendants:
a. The legitime shall be divided between the
LPA equally.
b. If one of the LPA dies before the testator, the
whole shall pass to the survivor.
c. If both LP dies before the testator but:
i. Survived by ascendants of equal
degree, legitime shall be divided equally
between the paternal and maternal line.
ii. Survived by ascendants of different
degrees, legitime shall pertain entirely
to the nearest degree (CIVIL CODE, Art.
890; JURADO, Succession, supra at
245-246).
Illustration: X, the testator, has an estate
amounting to P240,000. X was survived by his
father F, mother M, paternal grandfather PGF,
paternal grandmother PGM, maternal
grandfather MGF, and maternal grandmother
MGM.
a. How shall his estate be divided?
b. If F predeceased X?
c. If F, M, and PGM predeceased X?
Answer:
a. F and M shall both be entitled to P120,000
each. The legitime reserved for the
legitimate parents shall be divided between
them equally (CIVIL CODE, Art. 890).
b. M shall be entitled to P240,000 in
accordance with the rule of proximity. M
shall exclude those farther in degree. Also
Art. 890 of the Civil Code provides that “if
one of the parents should have died, the
whole shall pass to the survivor.”
c. PGF shall be entitled to P120,000 while
MGF and MGM shall be entitled to P60,000
each. If the testator leaves neither father or
mother, but is survived by ascendants of
equal degree of the paternal and maternal
lines, the legitime shall be divided equally
between both lines (CIVIL CODE, Art.890
par. 2).
Right to Receive Benefits from the Adoptee
in Case of Death of the Adopter
Adoption, without more, does not deprive the
biological parent of the right to receive the
benefits stemming from the adoptee’s death as
a dependent parent given the adopter’s untimely
demise during the adoptee’s minority. Since the
parent by adoption already died, then the death
benefits under the Employee’s Compensation
Program shall accrue solely to the biological
parent, the adoptee’s sole remaining beneficiary
(Bartolome v. SSS, G.R. No. 192531, November
12, 2014).
3. LEGITIME OF SURVIVING SPOUSE
Entitled to a legitime the amount of which is
variable depending upon whether he or she
survives alone or concurrently with other
compulsory heirs (JURADO, Succession, supra
at 285).
The condition of being a surviving spouse
requires that there should have been a valid
marriage between the deceased and the
survivor (DE LEON, Succession, supra at 326).
Annulment of voidable marriage
Voidable marriages are valid until they are set
aside by final judgment of a competent court in
an action for annulment (Diño v. Diño, G.R. No.
178044, January 19, 2011).
In case of death of a party during the
annulment proceedings, the survivor is
entitled to a legitime, because marriage can no
longer be annulled after the death of one of the
parties (Niñal v. Bayadog, G.R. No. 133778,
March 14, 2000).
If the party dies after the entry of judgment of
nullity or annulment, the judgment shall be
binding upon the parties and their successors-
in-interest in the settlement of the estate in the
regular courts (A.M. No. 02-11-10-SC, Sec.
24(b)) The survivor is no longer the spouse
entitled to a legitime.
Legal Separation
The widow or widower will be entitled to succeed
only when he or she is the innocent spouse
(FAMILY CODE, Art. 63, par. 4).
If death occurred during the pendency of the
legal separation proceedings, the effect shall
depend on which spouse died.
 a. If it was the plaintiff (innocent spouse) who A: No, because of the barrier between the
died, the proceeding shall continue to legitimate family (CIVIL CODE, Art. 992).
determine whether or not there is ground for
legal separation which shall justify the When representatives are of different classes
exclusion of the surviving spouse from (legitimate or illegitimate), they inherit naturally
inheritance (DE LEON, Succession, supra in the same proportions as in Art. Art. 895 since
at 327). this is also the rule in legal succession (3
b. If it was the defendant (guilty spouse) who PARAS, supra at 353-354).
died, the legal separation proceedings
should be terminated (FAMILY CODE, Art. Illustration: T has an illegitimate child A, who in
63; JURADO, Succession, supra at 236). turn has a legitimate child B, and an illegitimate
child C. If A predeceases T, both B and C will
In case of reconciliation under Art. 66(1) of the inherit by representation in the proportion of 2 is
Family Code, when one of the spouses should to 1 (Id.).
die, the legal separation proceedings which is
still pending shall be terminated at whatever 5. LEGITIME OF ILLEGITIMATE
stage (FAMILY CODE, Arts. 63 and 66). The PARENTS
survivor gets his or her legitime, regardless of
The illegitimate parents are entitled to 1/2 of the
whether he or she is the guilty party.
illegitimate child’s hereditary estate when he is
survived by neither legitimate descendant, nor
Legacy or devise to surviving spouse
surviving spouse, nor illegitimate children.
Any devise or legacy given to the surviving
(CIVIL CODE, Art. 903).
spouse should be considered as being in
addition to his or her legitime, and must
If the illegitimate child leaves a descendant,
therefore be charged to the free portion. Such
legitimate or illegitimate, the parents have no
devise or legacy should be considered in the
legitime (DE LEON, Succession, supra at 386).
same footing as those given to strangers (3
PARAS, supra at 343).
NOTE: Brothers and sisters are not compulsory
heirs but they may be instituted as voluntary heirs (3
4. LEGITIME OF ILLEGITIMATE PARAS, supra at 307).
DESCENDANTS
The amount of their legitime is variable RESERVA TRONCAL (OR RESERVA
depending upon whether they inherit alone or as EXTRAORDINARIA/ LINEAL)
a class or concurrently with other classes of
The reservation by virtue of which an ascendant who
compulsory heirs (JURADO, Succession, supra
inherits from his descendant any property which the
at 290).
latter may have acquired by gratuitous title from
another ascendant or a brother or sister, is obliged
Under the Family Code, there is no more
to reserve such property as he may have acquired
distinction between acknowledged natural
by operation of law for the benefit of relatives who
children and illegitimate children. They are all
are within the 3rd degree and who belong to the line
considered as illegitimate. Thus, the 5:4 ratio
from which such property came (CIVIL CODE, Art.
no longer applies (Id. at 292).
891).
When an illegitimate child dies before the
PURPOSES:
testator, his rights to the legitime are transmitted
1. To prevent persons who are strangers to the
to his own heirs. Representatives may either be
family from acquiring, by some chance or
legitimate or illegitimate descendants (CIVIL
accident, property which otherwise would have
CODE, Art. 902; JURADO, Succession, supra at
remained with the said family (JURADO,
301).
Succession, supra at 247); and
2. To maintain a separation between the paternal
Reason: Illegitimate children are considered
and maternal lines (3 TOLENTINO, supra at
innocent, and therefore despite the moral lapse
270).
of their parents, they are still given a legitime,
but precisely because they are born outside
Nature: It is an exception to both the system of
marriage, their legitime are less than those given
legitime and the order of intestate succession
to legitimate children (6 MANRESA, supra at
(JURADO, Succession, supra at 247).
570).

Q: Can illegitimate descendants of legitimate

children inherit by right of representation?
The reserva creates a double resolutory condition
to which the right of ownership of the person obliged
to reserve is subjected (Id. at 276).
The Resolutory Conditions are:
1. The death of the ascendant obliged to reserve;
and
2. Survival of relatives of the descendant-
propositus who are within the third degree, and
who belong to the line from which the property
came (Id.).
If the conditions are fulfilled: the property passes
in accordance with this special order of succession
to such relatives; automatic conversion into an
absolute right of ownership of the reservatario
(JURADO, Succession, supra at 250).
If the conditions are NOT fulfilled: property is
released and will be adjudicated in accordance with
the regular order of succession (Id.).
Requisites: (GOLD)
1. The property should have been previously
acquired by Gratuitous title by the descendant
from another ascendant or from a brother or
sister (CIVIL CODE, Art. 891);
2. The property should have been acquired by
Operation of law by an ascendant from his
descendant upon the death of the latter (CIVIL
CODE, Art. 891);
3. The descendant should have died without any
Legitimate issue in the direct descending line
who could inherit from him; and
4. There are relatives of the Descendant-
propositus who are within the 3rd degree and
who belongs to the line from which the property
came (Id.).
NOTE: The fourth requisite is sometimes added but
it is submitted to be merely a resolutory condition,
not a requisite (Id.).
NOTE: Reserva troncal contemplates legitimate
relationship. Illegitimate relationship and relationship
by affinity are excluded (Gonzalez v. Court of First
Instance of Manila, G.R. No. L-34395, May 19,
1981). Preference is given to the direct line as
against the collateral line, and the rule of “nearer
excludes the farther” also applies (Florentino v.
Florentino, G.R No. 14856, November 15, 1919).
Illustration: Before GF’s death in 2003, he donated
a parcel of land to his grandson, P, the only child of
his deceased son F. P died intestate in 2020 without
any heir in the direct descending line. As a
consequence of which, the land passed to his
mother M in accordance with intestate succession.
GF ORIGIN
B S +F
M
RESERVATARIOS RESERVISTA
+P
PROPOSITUS
It is reservable. M, upon P’s death, is obliged to
reserve it for the benefit of P’s relatives who are
within the third degree and who belong to the line
from which the property came.
The reservable character will terminate upon the
death of M. Therefore, B and S can claim the
property as their own (JURADO, Succession, supra
at 249).
PERSONAL ELEMENTS:
1. Origin/Origin of the Property
The Ascendant, or Brother or Sister (ABS) from
whom the propositus had acquired the property
by gratuitous title (e.g. donation, remission,
testate or intestate succession) (Id. at 252).
The property should have belonged to the
originator at the time of its acquisition by the
propositus. The source of the property prior to
the acquisition by the originator is immaterial (3
TOLENTINO, supra at 276).
The transmission from the origin to the
propositus must be by gratuitous title (3 PARAS,
supra at 321).
While the origin owns the property, there is no
reserva yet, and therefore, the origin has the
perfect right to dispose of it, in any way he
wants, subject, however, to the rule on
inofficious donations (3 PARAS, supra at 322).
If the origin of the property is a brother or sister
of the full-blood, the question of line is
unimportant. However, if the origin is a brother
or sister of the half-blood, the common parent or
ascendant must always be considered. If the
common ascendant is the father, the property is
reserved only for the relatives on the father’s
side; if the common ascendant is the mother, the
property is reserved only for the relatives on the
mother’s side (JURADO, Succession, supra at
264-265).
2. Propositus
The descendant (brother or sister) who died,
and from whose death the ascendant-reservista
in turn had acquired the property by operation of
law (JURADO, Succession, supra at 253; 3
PARAS, supra at 324).
The propositus should have died without any
legitimate issue in the direct descending line
who could inherit from him. Otherwise, it would
not be possible for the property to pass by
operation of law to an ascendant-reservista
(JURADO, Succession, supra at 260).
The term “by operation of law” applies to the
transmission of the legitime in case of
testamentary, and to the entire inheritance in
case of intestate succession (3 TOLENTINO,
supra at 282).
The property should be acquired by gratuitous
title from an ascendant, brother or sister (CIVIL
CODE, Art. 891).
Prior charges on the property do not negate the
gratuitous character of the transmission (Chua
v. Court of First Instance of Negros Occidental,
G.R. No. L-29901, August 31, 1977).
If the property is acquired by virtue of a
compromise involving hereditary properties, it
can be truthfully said that the property was
acquired, not by document of compromise but
by inheritance. Hence, the acquisition is by
gratuitous title (Cabardo v. Villanueva, G.R. No.
19003, December 13, 1922).
Propositus as “arbiter of the fate of reserva
troncal”
As long as the propositus is still alive, there is no
reserve yet, therefore he is the absolute owner
of the property acquired by him gratuitously from
the origin, with full freedom to alienate or
encumber (3 PARAS, supra at 323).
In case he sells the property and because of
such sale he receives cash, there is no reserva
even if the cash is later on inherited by the
ascendant by operation of law since the cash is
not the same property that he had acquired
gratuitously (Id.).
A will may prevent the constitution of a reserva.
In case of testate succession, only the legitime
passes by operation of law. The propositus may,
by will, opt to give the legitime of his ascendant
without giving to the latter properties he had
acquired by gratuitous title from another
ascendant, or brother or sister. In such case, a
reserva troncal is avoided (Id. at 288).
3. Reservista
The other ascendant who is obliged to reserve
the property for the benefit of the relatives of the
descendant-propositus who are within the 3rd
degree and who belong to the line from which
said property came (JURADO, Succession,
supra at 253).
He must have acquired the property by
operation of law (Id. at 260). If he inherited the
property from the descendant not by legal
succession nor by virtue of the legitime, there is
no obligation to reserve. This happens when he
inherits the free portion by virtue of a will (3
PARAS, supra at 324).
The person obliged to reserve the property
should be an ascendant of the descendant-
propositus (Mendoza v. Delos Santos, G.R. No.
176422, March 20, 2013). A collateral relative
cannot be a reservista.
Rights of Reservista
Upon the death of the descendant-propositus,
the reservista acquires all of the attributes of the
right of ownership, such as enjoyment, disposal,
and recovery, although conditional and
revocable. Thus, he can alienate or encumber
the property. However, the acquirer will only
receive a limited and revocable title which the
reservatarios may then rescind after the death of
the reservista (JURADO, Succession, supra at
273).
Reservatario cannot, as long as the reservista is
alive, impugn or annul any alienation or
encumbrance effected by the reservista,
whether the same be on personal or real
property (Edroso v. Sablan, G.R. No. 6878,
September 13, 1913).
If the property subject to reserva is personal
property, the reservista, being the full owner
thereof, may donate, sell, or pledge them, and
the donee-purchaser becomes full owner of the
property. This is without prejudice to the right to
reimbursement of the reservatario (should they
survive the reservista) from the estate of the
reservista for whatever they have lost by virtue
of such donation, sale or pledge (3 PARAS,
supra at 326).
If it is a reservable real property, the reservista
may alienate it subject to reserva troncal i.e.,
reservatario can recover the real property from
the transferee as soon as ownership is
transferred to such reservatario, without
prejudice of course to the Land Registration Act.
Thus, if reservable land is registered under the
Torrens System as free, an innocent purchaser
 for value will be preferred over a reservatario.
However, the estate of the reservista will have to
indemnify the reservatario (Id.).
Obligations of Reservista/Rights of
Reservatario: (ASIA)
a. To Annotate in the Registry of Property the
reservable character of all reservable
immovable property;
b. To Secure by mortgage: (a) restitution of
movables not alienated, (b) payment of
damages caused by his fault or negligence,
(c) return of price received for movables
alienated or pay its value if made
gratuitously, and (d) payment of value of
immovable alienated;
c. To make an Inventory of all reservable
property; and
NOTE: Reservista has a period of 90 days,
from the time the reserve arises, in which to
register the reservable character of the
property, if he does not voluntarily cause the
registration, reservatarios may judicially
demand that he be compelled to make it (3
TOLENTINO, supra at 292).
d. To Appraise value of all reservable movable
property (JURADO, Succession, supra at
274).
4. Reservatarios
The relatives of the descendant-propositus
within the 3rd degree and who belong to the line
from which the property came and for whose
benefit the reservation is constituted (Id. at 253).
Conditions:
a. They must be legitimate relatives of the
descendant-propositus within the 3rd degree
(Id. at 262);
The degree of relationship must be counted
from the descendant-propositus, because it
is only upon his death that the property
becomes reservable (Id.).
PERSONS WHO CAN QUALIFY AS
RESERVATARIOS
DEGREE OF
RELATIVES INCLUDED
RELATIONSHIP
1st degree Legitimate father or mother
relatives
2nd degree 1. Grandparents; and
relatives 2. Brothers or sisters (of the
full or half-blood) belonging
to the line from which the
reservable property came.
3rd degree 1. Great grandparents;
relatives 2. Uncles or aunts (brothers
or sisters of the full or half-
blood of the prospositus’
father or mother); and
3. Nephews or nieces
(children of propositus’
brothers or sisters of the
full or half-blood)
(Id. at 263).
NOTE: The origin may be a reservatario.
Under Art. 189, par. 1 of the Family Code,
the adopted shall be deemed to be a
legitimate child of the adopters and both
shall acquire the reciprocal rights and
obligations arising from the relationship of
parent and child. So, adopted children may
now claim the benefit of reserva troncal in
their favor (DE LEON, Succession, supra at
358).
First cousins of the propositus are 4th degree
relatives and are not reservatarios
(Mendoza v. Delos Santos, G.R. No.
176422, March 20, 2013).
b. They must belong to the line from which the
reservable property came (JURADO,
Succession, supra at 262); and
“Line from which the property came”
refers to the paternal line as opposed to the
maternal line, or vice versa and not to that
which is constituted by a series of degrees
which may be either direct or collateral (Id.
at 263).
Illustration:
Origin: Paternal grandfather
Reservista: Mother
Reservatario: Paternal grandmother
Considering the case, does the
grandmother come from the line from which
the property came?
Two views:
First view: It is advocated by Manresa that
since the law merely states that the
reservatario should belong to the line from
which the reservable property came without
any qualification whatsoever, it is clear that
she would be entitled to the property (Id. at
264).
 Second view: Sanchez Roman, with whose
view Justice Jurado agreed, advocated that
since the grandmother is not related by
consanguinity to the origin of the property
but only by affinity, she cannot be
considered as belonging to the line from
which the property came (Id.).
Otherwise stated, the reservatario must not
only be a relative by consanguinity of the
descendant-propositus within the 3rd
degree, but he must also be a relative by
consanguinity of the source or origin of the
property (Id.).
i. If the origin is a brother or sister of
the full blood – the question of line is
unimportant because there is no way by
which we would be able to determine
the “line from which the property came”
(Id.).
ii. If the origin is a brother or sister of
the half-blood – the common parent or
ascendant must always be considered
(Id. at 265).
c. They must survive the ascendant-reservista
(Id. at 262).
If the ascendant-reservista is survived by
several relatives of the descendant-
propositus and all of them are within the 3rd
degree belonging to the line from which the
reservable property came, the rules of legal
or intestate succession shall apply (Id. at
267).
A 3rd degree reservatario was still alive at
the time the reservista died. Said
reservatario, even if he dies, before claiming
the property nevertheless transmits rights to
his own heirs for after all, he survived the
reservista (3 PARAS, supra at 338).
TWO TESTS TO DETERMINE WHO CAN
QUALIFY AS RESERVATARIO:
If there are several claimants:
1. Is the claimant a relative of the descendant-
propositus within the 3rd degree?
2. Does he belong to the line from which the
reservable property came? (JURADO,
Succession, supra at 265).
During the whole period between the constitution of
the reserva and the extinction thereof, the
reservatarios only have an expectation to the
property, an expectation which cannot be
transmitted to their own heir, unless these heirs are
also within the 3rd degree (Id. at 250).
The reserve instituted by law in favor of the heirs
within the third degree belonging to the line from
which the reservable property came, constitutes a
real right which the reservee may alienate and
dispose of, albeit conditionally, the condition being
that the alienation shall transfer ownership to the
vendee only if and when the reservee survives the
person obliged to reserve (Sienes v. Esparcia, G.R.
No. L-12957, March 24, 1961).
Even during the reservista’s lifetime, the
reservatarios who are ultimate acquirers of the
property can already assert the right to prevent the
reservista from doing anything that might frustrate
their reversionary right. They may compel the
annotation of their right in the Registry of Property
(Gonzalez v. Court of First Instance of Manila, G.R.
No. L-34395, May 19, 1981).
NOTE: The person obliged to reserve is a legitimate
ascendant who inherits from a descendant property
which proceeds from the same legitimate family
(Nieva v. Alcala, G.R. No. 13386, October 27, 1920)(
JURADO, Succession, supra at 253).
SUMMARY OF RULES:
1. Reserva troncal merely determines the group of
relatives (reservatarios) to whom the property
should be returned; and
2. Within that group, the individual right to the
property should be decided by the applicable
rules of ordinary intestate succession (Padura v.
Baldovino, G.R. No. L-11960, December 27,
1958).
PROPERTY SUBJECT TO
RESERVATION
GENERAL RULE: It must be the same property
which the reservista had acquired by operation of
law from propositus upon the death of the latter and
which the latter in turn had acquired by gratuitous
title during his lifetime from another ascendant,
brother or sister (3 TOLENTINO, supra at 282).
EXCEPTION: Substitution of the reservable
property through unavoidable necessity: (CLAD)
1. Property is Consumable;
2. Lost/destroyed through the fault of the
reservista;
3. Deteriorated through the same cause; and
4. It has been Alienated (JURADO, Succession,
supra at 273).
REMEDIES OF RESERVATARIOS WHEN
THERE IS SUBSTITUTION OF THE
RESERVABLE PROPERTY THROUGH
UNAVOIDABLE NECESSITY:
1. To recover the value of the property;
2. To seek the ownership or return thereof; and
3. If the reservable property is a sum of money –
the ordinary rules for the collection of credit
apply (Id.).
If the reservable property consists of sum of
money and the reservista died with no cash, the
reservatarios can either, select equivalent
property from the estate or demand the sale of
sufficient property in order to raise the
necessary amount (Id.).
THEORIES ON THE VALUE OF
RESERVA
1. Reserva Maxima
The reserve should apply to the property that
has been gratuitously acquired from some
ascendant, brother or sister that can be included
within the legitime of the reservista, or 1/2 of the
estate (3 TOLENTINO, supra at 284).
This is based on general principles of law and is
more equitable. It is more in line with the
philosophy of the present code of socialization
of property (Id. at 284-285).
2. Reserva Minima (Proportional Reserva)
All the property passing to the reservista must
be considered as passing partly by operation of
law and partly by will of the descendant, and
therefore, one-half of the properties acquired
gratuitously by the descendant from another
ascendant, or brother or sister, should be
reservable, and the other half should be free
(Id.).
Illustration: The descendant-propositus died
with a will wherein his mother is instituted as
universal heir. The net value of his hereditary
estate is P40,000. One-half of this estate (20T)
had been acquired gratuitously from his
deceased father, while the other half (20T) had
been acquired through his own efforts or
industry.
a. Reserva maxima – all of the properties
acquired from the father are reservable
because they can be contained in the
mother’s legitime. Therefore, the entire 20T
is reservable.
b. Reserva minima – one-half of said
properties acquired from the deceased
father shall be included in the legitime of the
mother which shall be considered as
reservable, while the other half shall be
included in the free portion. Therefore, only
half of 20T (10T) is reservable (JURADO,
Succession, supra at 261-262).
EFFECTS WHEN RESERVATARIO
ACQUIRES RIGHT
Upon the death of the reservista, the reservatario
nearest in degree to the descendant-propositus
becomes, automatically and by operation of law, the
absolute owner of the reservable property.
Consequently, the property is withdrawn
automatically from the estate of the reservista. It
cannot be sold for the payment of his debts (Id. at
276-277).
CAUSES FOR EXTINGUISHMENT OF
RESERVA TRONCAL: (RP2-LAW)
1. Registration by the reservista of the property as
free property under the Land Registration Act;
2. Prescription of the right of the reservatarios,
when the reservista holds the property adversely
against them in the concept of an absolute
owner (10 years from the death of the
propositus);
3. Death of all relatives of Propositus within the
third 3rd degree who belong to the line from
which the property came;
4. Loss of the reservable property for causes not
due to the fault or negligence of the reservista;
5. Death of Ascendant reservista; and
6. Waiver or renunciation by the reservatarios (Id.
at 277-283).
TRANSMISSIBILITY OF RIGHTS
1. The rights of illegitimate children are transmitted
upon their death to their descendants, whether
legitimate or illegitimate (CIVIL CODE, Art. 902).
NOTE: An illegitimate child has no right to inherit
ab intestato from the legitimate children and
relatives of his father or mother; nor shall such
children or relatives inherit in the same manner
from the illegitimate child. (CIVIL CODE, Art. 992
or the Rule of Barrier between the Legitimate
and Illegitimate Family a.k.a. “Iron Curtain or Iron
Clad Rule”).
2. In the case of legitimate children, the person/s to
whom the right is transmitted must be legitimate
descendants (JURADO, Succession, supra at
301).
Thus:
1. Illegitimate children have no right of
representation with respect to their legitimate
parents.
2. Illegitimate children of illegitimate parents can
represent the latter in the inheritance of their
grandparents’ estate (CIVIL CODE, Art. 992).
PRINCIPLE OF UNTOUCHABILITY OF
LEGITIME
GENERAL RULE: The testator cannot deprive his
compulsory heirs of their legitime. Neither can he
impose any burden, encumbrance, condition, or
substitution of any kind whatsoever (CIVIL CODE,
Art. 904).
Should there be any charge, condition, substitution
or encumbrance upon the legitime, said charge, etc.
shall be considered as not imposed (CIVIL CODE,
Art. 872).
EXCEPTIONS:
1. Valid disinheritance (CIVIL CODE, Art. 915);
2. Reserva Troncal (CIVIL CODE, Art. 891);
3. Family Home (FAMILY CODE, Art. 159); and
4. When the testator expressly forbids the division
of the estate but not to exceed 20 years (CIVIL
CODE, Art. 1083).
If the testator has compulsory heirs, he can dispose
of his property provided he does not impair their
legitimes (Hacbang v. Alo, G.R. No. 191031,
October 5, 2015).
Renunciation or compromise as regards future
legitime between the person owning it and his
compulsory heir is void (CIVIL CODE, Art. 905).
REASONS:
1. The rights of the heirs are merely inchoate
because it is only perfected upon the testator’s
death. Hence, there is still nothing to renounce
or compromise (JURADO, Succession, supra at
306).
2. No contract maybe entered into with respect to
future inheritance except in cases expressly
authorized by law (CIVIL CODE, Art. 1347, Par.
2).
WHO MAY CLAIM NULLITY OF
RENUNCIATION OR COMPROMISE
1. Compulsory heir who renounced or
compromised his legitime; or
2. Any co-heir who may be prejudiced by such
renunciation or compromise (JURADO,
Succession, supra at 307).
However, if the claim for nullity is made only after the
death of the testator, it is required that the heir who
is filing the claim must bring to collation whatever he
might receive by virtue of the renunciation or
compromise (Id.).
INCOMPLETE LEGITIME V.
PRETERITION
ART. 906
ART. 854
(INCOMPLETE
(PRETERITION)
LEGITIME)
As to the Nature of Omission
Heir not entirely Total omission of the
forgotten. heir.
As to the Amount of Deprivation
Less than the portion of Total deprivation of
the legitime. legitime.
As to the Remedy
Remedy is to demand Effect is the total
for completion of annulment of the
legitime. institution of heirs.
(Id. at 306).
Any compulsory heir to whom the testator has left by
any title less than the legitime belonging to him may
demand that the same be fully satisfied (CIVIL
CODE, Art. 906). This is their action ad supplendam
legitimam, or their right of completion of legitime.
Such relief must be sought during the distribution
and partition stage of a case for settlement of the
estate of their deceased parent (Gala v. Ellice Agro-
Industrial Corp., G.R. No. 156819, December 11,
2003).
NOTE: “Any title” means, for example, donation,
intestate succession, remission, since a donation or
a remission is merely an advance of the legitime. If
there is a real preterition, as when absolutely nothing
is given, the heir concerned is entitled not only to a
completion of his legitime, but also to the annulment
of the institution (3 PARAS, supra at 357).
REDUCTION OF INOFFICIOUS
TESTAMENTARY DISPOSITIONS
Testamentary dispositions that impair or diminish
the legitime of the compulsory heirs shall be reduced
on petition of the same, insofar as they may be
inofficious or excessive (CIVIL CODE, Art. 907).
EFFECT OF INOFFICIOUS DONATIONS:
Donations inter vivos are to be reduced if found
inofficious (i.e. if they exceed the free portion) for no
person may give by way of donation more than he
may give by will (CIVIL CODE, Art. 752). The
donation is considered inofficious in all that it may
exceed this limitation (3 PARAS, supra at 300).
An alienation, however, which is for an onerous or
valuable consideration (as a sale) would be proper
since in this case, there merely is the substitution of
one kind of property for another (Id.).
STEPS IN DISTRIBUTION OF ESTATE IF
THERE ARE DONATIONS:
1. Determination of the gross value of the
estate at the time of the death of the
testator (CIVIL CODE, Art. 908);
Gross value
a. If there is an administration proceeding:
it is the executor or administrator who, within
3 months after his appointment, shall return
to the court a true inventory or appraisal of
all the real and personal estate of the
deceased which have come to his
possession or knowledge.
b. If there is no administration proceeding:
it is the actual value of the estate
c. The valuation or appraisal may be made by
common agreement (JURADO,
Succession, supra at 314).
2. Determination of all debts and charges
which are chargeable against the estate
(CIVIL CODE, Art. 908);
NOTE: Refers to the pre-existing obligations of
the testator during his lifetime, and not to the
charges or burdens which are created by the
testamentary dispositions found in the will
because the latter are chargeable against the
portion at the testator’s free disposal (JURADO,
Succession, supra at 314).
3. Determination of the net value of the
estate by deducting all the debts and
charges from the gross value of the
estate (CIVIL CODE, Art. 908, par. 1);
4. Collation or addition of the value of all
donations inter vivos to the net value of
the estate (CIVIL CODE, Art. 908, par. 2);
Value to be collated is the value of the donation
at the time the donation was made. Any loss,
deterioration, or improvement of the thing from
the time when the donation was made up to the
time of the settlement of the estate shall be for
the account or benefit of the donee (JURADO,
Succession, supra at 315).
Proceeds of an insurance policy where the
beneficiary is a third person or even a
compulsory heir belongs exclusively to the
beneficiary and not to the estate of the insured.
Hence, not subject to collation (Del Val v. Del
Val, G.R No. 9374, February 16, 1915).
In case of premiums, although they partake of
the nature of donations, it is submitted that so
long as they are paid from the income of the
insured and are not excessive, they are not
subject to collation (JURADO, Succession,
supra at 316).
5. Determination of the amount of the
legitime from the total thus found (CIVIL
CODE, Art. 908);
6. Imputation of the value of all donations
inter vivos made to compulsory heirs
against their legitime and of the value of
all donations inter vivos made to
strangers against the disposable free
portion and restoration to the hereditary
estate if the donation is inofficious (CIVIL
CODE, Art. 909); and
Imputation is merely a mathematical process of
determining whether the value of donation can
be contained in the legitime or disposable
portion, as the case may be, or not (JURADO,
Succession, supra at 317).
7. Distribution of the residue of the estate
in accordance with the will of the testator
(Id. at 310-311).
MEANING OF COLLATION
1. Fictitious mathematical process of adding the
value of the thing donated to the net value of the
hereditary estate (CIVIL CODE, Art. 908 and
Arts. 1061–1077).
PURPOSE: To compute the legitime of
compulsory heirs (JURADO, Succession, supra
at 315).
2. Act of charging or imputing such value against
the legitime of the compulsory heir to whom the
thing was donated (CIVIL CODE, Arts. 1061–
1077).
PURPOSE: To take the donations in the
account of partition in order to equalize the
shares of the compulsory heirs as much as
possible (JURADO, Succession, supra at 315).
3. Actual act of restoring to the hereditary estate
that part of the donation which is inofficious in
order not to impair the legitime of compulsory
heirs (Id.).
REDUCTION OF TESTAMENTARY 4. However, the amount left out of the disposable
DISPOSITIONS AND DONATIONS portion will only be 15T which is less than the
amount of legacies made in favor of Y and Z.
The order of preference is:
Hence, pro rata reduction is necessary.
1. Legitime of compulsory heirs
5. Thus, to determine the legacy in favor of Y,
2. Donations inter vivos
Let: X = reduced legacy
In case of two or more donations where the
a. 15T = disposable free portion left out
disposable portion is not sufficient to satisfy
b. 10T = legacy to Y to be reduced
them, those of the recent date shall be reduced
c. 20T = total of all legacies in favor of Y and Z
(CIVIL CODE, Art. 773).
10T(15 150
3. Preferential legacies or devises X 10T
X T) T P7,5
4. All other legacies and devises (CIVIL CODE, = = =
15 = 20T 00
Art. 911). 20T 20T
T
NOTE: The reverse order of the foregoing shall be
6. Hence, Y is entitled to 7,500. Using the same
followed in case reduction shall be necessary (3
formula, Z is also entitled to 7,500 for a total of
PARA, supra at 369).
15T (JURADO, Succession, supra at 322).
If after satisfying the legitime of compulsory heirs,
NOTE: Article 911 applies when aside from the
the disposable portion is sufficient to cover
various legacies and devises, there are legitimes to
donations inter vivos, but not the legacies and
be preserved (Id. at 363).
devises, the rule is that such legacies and devises
will be reduced pro rata, after satisfying those
Article 950 applies when there are no compulsory
preferential ones (JURADO, Succession, supra at
heirs or when there are no inofficious donations inter
321).
vivos (Id.).
Donations inter vivos are preferred over dispositions
mortis causa because the former are irrevocable by
their very nature. They have been perfected upon
the knowledge of the donor that the donee has DISINHERITANCE
accepted the donation (Id.). (ARTS. 915-923)
On the other hand, testamentary dispositions are
unilateral in character and produce juridical effects
only after the testator’s death (Id.). DISINHERITANCE
It is the act of the testator in depriving a compulsory
Formula for Pro Rata Reduction:
heir of his legitime for causes expressly stated by
𝑅𝑒𝑑𝑢𝑐𝑒𝑑 𝐿𝑒𝑔𝑎𝑐𝑦 𝐿𝑒𝑔𝑎𝑐𝑦 𝑡𝑜 𝑏𝑒 𝑅𝑒𝑑𝑢𝑐𝑒𝑑 law (Id. at 327).
=
𝐷𝑖𝑠𝑝𝑜𝑠𝑎𝑏𝑙𝑒 𝑃𝑜𝑟𝑡𝑖𝑜𝑛 𝑇𝑜𝑡𝑎𝑙 𝑜𝑓 𝑎𝑙𝑙 𝐿𝑒𝑔𝑎𝑐𝑖𝑒𝑠 It is the only instance recognized by the Civil Code
by which a compulsory heir may be deprived of his
Illustration: The net value of the testator’s estate is legitime by the testator (Id.).
40T. During his lifetime, he donated to X 10T. In his
will, he bequeathed 10T each to Y and Z. He has a
son S. Distribute his estate.
PURPOSE:
To punish the ungrateful, the culpable, the cruel, the
Answer: unnatural heir or an unfaithful spouse. The purpose
The estate shall be distributed as follows: of disinheritance is not vengeance but retribution (3
1. Collate or add the donation in favor of X to the PARAS, supra at 378).
estate. [10T + 40T = 50T]
2. Determine the legitime of his compulsory heir, REQUISITES: (LV-CUTS-RED)
and subtract it to the net value. In this case, S 1. For a cause expressly stated by Law;
as the son is entitled to ½ of the estate. [50T x 2. Effected only through a Valid will;
½ = 25T]. Leaving a disposable free portion of 3. Cause must be Certain and true;
25T. [50T – 25T (legitime) = 25T]. 4. Unconditional;
3. Since the 10T donation in favor of X can be 5. Total or complete;
imputed to the disposable free portion, it will not 6. Cause must be Stated in the will itself;
be reduced. 7. The will must not have been Revoked;
8. For an Existing cause; and
9. The heir disinherited must be designated in such
a manner that there can be no Doubt as to his
identity (Id. at 381).
The last will of the testator may be embodied in
several documents. Taken together, they constitute
his last will and testament (JURADO, Succession,
supra at 328).
Thus, if a compulsory heir is disinherited in one will
without a specification of the cause, the same may
be cured if the cause thereof shall be specified in
another will (Id.).
Since compulsory heirs may be disinherited only for
lawful causes, the courts may properly inquire into
the validity of a disinheritance (3 PARAS, supra at
379).
EFFECTS OF DISINHERITANCE:
1. Deprivation of the compulsory heir who is
disinherited of any participation in the
inheritance including the legitime and free
portion;
2. The children/descendants of the person
disinherited shall take his or her place and shall
preserve the rights of compulsory heirs with
respect to the legitime; and
3. The disinherited parent shall not have the
usufruct or administration of the property which
constitutes the legitime (JURADO, Succession,
supra at 343).
Illustration: T has a son A. In his will, T said, “If A
tries to kill me, I will disinherit him”. Later A really
tried to kill T and was duly convicted therefor. T,
however, never made any other will.
1. Has A been validly disinherited?
2. Will A inherit anything?
Answer:
1. No, A has not been validly disinherited, because
the disinheritance was conditional, and for a
cause that had not yet occurred at the time the
will was executed.
2. No, A will not inherit, not because of
disinheritance, but because he is incapacitated
to succeed, by virtue of Art. 1032(2), which
provides that any person who has been
convicted of an attempt against the life of the
testator is incapable of succeeding by reason of
unworthiness (3 PARAS, supra at 381)
Revocation of the disinheritance may be conditional
(Id.).
INSTANCES OF IMPERFECT
DISINHERITANCE
1. Disinheritance has no specification as to the
cause;
2. Disinheritance for a cause, the truth of which, if
contradicted is not proved;
3. Cause is not one of those set forth in the Civil
Code; and
4. When one or more of the requisites for a valid
act of disinheritance is/are lacking (CIVIL
CODE, Art. 918).
EFFECTS OF IMPERFECT
DISINHERITANCE:
1. If testator had made a disposition of the
entire estate:
The institution of heirs is annulled insofar as it
may prejudice the person disinherited; does not
affect the dispositions of the testator with
respect to the free portion.
Devises, legacies and other testamentary
dispositions shall be valid to such extent as will
not impair the legitime (3 PARAS, supra at 385).
Illustration: A disinherited B, and instituted C
and D as his heirs. B, C, and D are all A’s
legitimate children. The disinheritance of B was
invalid because it was for a cause not provided
by law. The hereditary estate is P900,000. How
much will each of the children receive?
Answer:
B’s legitime is P150,000 (he gets this)
C gets P375,000
D gets P375,000
P900.000
The institution of heirs remains valid, but the
shares of the instituted heirs will be decreased
to give B his legitime (Id.).
2. If testator did not dispose of the free
portion:
The compulsory heir is given all that he is
entitled to receive as if the disinheritance has
not been made, without prejudice to lawful
dispositions made by the testator in favor of
others (Id. at 386).
Illustration: T has two legitimate children, A
and B. His estate is 1 million. In his will, T gave
A his legitime of ¼ and ineffectively disinherited
B. How much will B get?
Answer: B gets P250,000 as legitime, and a
half share as intestate share in the free portion
of P500,000 (or P250,000). Thus, he gets a total
of P500,000 (Id at 385).
 IMPERFECT DISINHERITANCE V. As to Existence of a Will
PRETERITION
A will is always May exist with or
IMPERFECT required. without a will (as when
PRETERITION
DISINHERITANCE everything is given to
only one of the
As to Who is Omitted compulsory heirs by
way of donation inter
The person disinherited The person omitted
vivos).
may be any compulsory must be a compulsory
heir. heir in the direct line. As to Validity
As to Whether Express or Implied May be VALID when all The institution is always
of the requirements of VOID, except when the
Always express. Always implied.
the law are met. preterited heir
As to Whether Intentional or Not predeceased the
testator.
Always intentional. May be intentional or (Id. at 327-328; 343-344).
unintentional.
Illustration: X died leaving his instituted heirs
As to its Effect
namely: his wife W, and his 2 daughters A & B
Partial annulment of Total annulment of without designating their respective shares. His 3rd
institution of heirs. institution of heirs. daughter, C, however, was omitted entirely without
being disinherited. In the will, X also bequeathed a
As to Validity of Institution legacy of P20,000 to A. The net value of the estate
is P240,000. How shall such estate be distributed?
Institution remains Institution is completely
valid, but must be annulled. Answer: There was preterition in this case. Thus,
reduced insofar as the the rules of intestacy shall be applied. The P20,000
legitime has been was not inofficious because it can easily be
impaired. contained in the disposable free portion. The
distribution shall be as follows:
(JURADO, Succession, supra at 329).

VALID DISINHERITANCE V.
Free Amount
PRETERITION Heir Legitime Legacy
Portion Received
VALID
PRETERITION A 40,000 15,000 20,000 75,000
DISINHERITANCE
B 40,000 15,000 -- 55,000
As to Whether Intentional or Not
C 40,000 15,000 -- 55,000
Always intentional May be intentional or
unintentional. W 40,000 15,000 -- 55,000

As to Cause However, if there was imperfect disinheritance in the

abovementioned problem such that there was
The cause must always May be with or without a disinheritance without any specification of the cause,
be stated in the will and cause. the estate shall be distributed as follows:
it must be true and
legal.
Free Amount
Heir Legitime Legacy
As to Effect Portion Received

The disinherited heir Preterition annuls the A 40,000 20,000 20,000 80,000
inherits nothing. institution, therefore the B 40,000 20,000 -- 60,000
omitted heir inherits.
C 40,000 -- -- 40,000
W 40,000 20,000 -- 60,000
The disinheritance of C was defective for failure to
state the cause or ground of disinheritance. C will not
get a part of the free portion because the effect of
imperfect disinheritance is only to annul the
institution of heirs insofar as it prejudices the legitime
of the disinherited. The effect differs from preterition
where the annulment of the institution of heirs is total
(Id. at 330-331).
A document, entitled “Kasulatan ng Pag-Alis ng
Mana,” although it may initially come across as a
mere disinheritance document, is considered a will if
it conforms to the formalities prescribed by law.
While it does not make an affirmative disposition of
the testator’s property, the disinheritance of an heir,
nonetheless, is an act of disposition in itself (Dy
Yieng Seangio v. Reyes, G.R. Nos. 140371-72,
November 27, 2006).
There is no preterition when the document merely
mentions the name of one of the heirs, and does not
operate to institute him as the universal heir. In this
case, there is no institution of an heir “to the
exclusion of other compulsory heirs” (Dy Yieng
Seangio v. Reyes, G.R. Nos. 140371-72, November
27, 2006).
COMMON CAUSES FOR
DISINHERITANCE OF CHILDREN OR
DESCENDANTS, PARENTS OR
ASCENDANTS, AND SPOUSE: (AFAR)
1. When the heir has been found guilty of
an Attempt against the life of the
testator, his/her descendants or
ascendants, and spouse in case of
children and parents;
Requisites:
a. The disinherited heir must have committed
either attempted or frustrated parricide
against the testator; and
b. He must have been convicted by final
judgment of said criminal offense.
Applicable whether as principal, accessory
or accomplice (Id. at 333).
NOTE: If the attempt is made by the spouse,
conviction is not necessary (Id. at 342).
Even if there is no previous criminal
conviction, the attempt, if it is made against
the life of the testator, will constitute a valid
ground for disinheritance under Art. 919(6)
(maltreatment of the testator by word or
deed) of the Civil Code; provided all the
requisites for said ground are present (Id. at
333).
If after conviction there is pardon,
disinheritance is still proper, unless, the
pardon be based on the heir’s complete
innocence (3 PARAS, supra at 30).
Conviction for “homicide thru reckless
imprudence” is not a ground under par. (1)
in view of the absence of intent to kill (Id.).
2. When the heir by Fraud, violence,
intimidation, or undue influence causes
the testator to make a will or to change
one already made;
3. When the heir has Accused the testator
of a crime for which the law prescribes
imprisonment for 6 years or more, if the
accusation has been found groundless;
and
Requisites:
a. Heir accused the testator of a crime;
b. Penalty for the crime is imprisonment for 6
years or more; and
c. Accusation must have been found to be
groundless (JURADO, Succession, supra at
333-334).
The heir shall make the accusation either in the
capacity of a complainant or of a witness (Id. at
334).
There must be a judicial declaration that the
accusation has been found groundless (3
TOLENTINO, supra at 362).
Acquittal of the testator on the ground of lack of
proof of guilt beyond reasonable doubt, or lack
of criminal intent does not necessarily mean that
the accusation was groundless (Javier v.
Lucero, G.R. No. L-6706, March 29, 1954). In
other words, the testator would not have the right
to disinherit the accusing heir (3 PARAS, supra
at 390.
4. Refusal without justifiable cause to
support the testator who disinherits
such heir
Judicial demand for support is not necessary (3
TOLENTINO, supra at 362). However, the
refusal must be without justifiable cause (Id. at
363). If with justifiable cause, the disinheritance
is imperfect or ineffectual (JURADO,
Succession, supra at 334).
Examples of justifiable reasons include: reduced
resources resulting in the neglect even of his
own needs, and the testator’s fortune improved
that he no longer needs support (Id.).
PECULIAR CAUSES FOR
DISINHERITANCE
1. Children/Descendants: (C-MAD)
a. Conviction of a crime which carries with it a
penalty of civil interdiction;
b. Maltreatment of the testator by word or deed
by the child/descendant;
NOTE: Must be intentional or voluntary (Id.
at 335).
NOTE: Maltreatment by an ascendant of a
descendant does not constitute a ground for
disinheritance as it is generally in the
exercise of a power. The reverse is,
however, repugnant to natural law and
therefore a ground for disinheritance (3
PARAS, supra at 393).
c.
c. When the child/descendant has been
convicted of Adultery or concubinage with
the spouse of the testator; and
NOTE: Final judgment of conviction is an
essential requisite (JURADO, Succession,
supra at 334).
d. When the child/descendant leads a
Dishonorable or disgraceful life (it includes
both male and female descendants) (CIVIL
CODE, Art. 919, par. 7).
NOTE: In this ground, final conviction is not
necessary (DE LEON, Succession, supra at
427). It may cover adultery or concubinage
without conviction (JURADO, Succession,
supra at 334).
NOTE: The Code Commission broadened
the scope of Art. 853 of the Old Civil Code
which only covered the act of prostitution by
a daughter (3 PARAS, supra at 393).
A single act is not ordinarily sufficient, for
“leading a life” implies continuity to be a
sufficient cause for disinheritance (Id.).
2. Parents/Ascendants: (CALA)
a. When the parent/ascendant has been
convicted of adultery or Concubinage with
the spouse of the testator;
b. When the parents have Abandoned their
children or induced their daughters to live a
corrupt or immoral life, or attempted against
their virtue;
Abandonment – refers to the failure of the
parents to give their children due care,
instruction and support (JURADO,
Succession, supra at 337). It means neglect
or refusal to perform the natural and legal
obligations of care and support which
parents owe to their children (Santos v.
Aranzanso, G.R. No. L-23828, February 28,
1966)
Inducing their daughters to live a corrupt
and immoral life comprehends the act of
the parents in inducing their daughters or
granddaughters, by advice, force,
intimidation or any other positive act, to live
a life of corruption and immorality (JURADO,
Succession, supra at 337).
Attempt against their virtue includes any
criminal act against the child’s chastity by
the parent/s either as principals, co-
principals or accomplices (Id.).
Loss of parental authority for causes
specified in the Code; and
NOTE: There must be an actual loss
effected by final judgment (Id. at 338).
Two Views on the Effect of Restoration of
Parental Authority
1st View: No effect on the disinheritance
because the ground or basis for the
disinheritance is not the loss of parental
authority but the offense committed by the
offender (Id. at 339).
2nd View: The testator would be deprived
of his right to disinherit his parent or
ascendant, or it would render the
disinheritance ineffectual because the legal
basis for disinheritance would no longer
exist (Id.).
Reconciliation of the Two Views:
Even if there is a restoration of the parental
authority brought about by absolute pardon
or by the spouses or reconciliation, it cannot
erase the existence of the offense against
the testator. The law allows the testator to
punish not the consequence of the offense
but the offense itself (Id. at 340).
Grounds for Loss of Parental Authority in
Relation to Disinheritance: (CLEB)
i. Treats the child with Excessive
harshness or cruelty;
ii. Gives the child Corrupting orders,
counsel, or example;
iii. Compels the child to Beg; or
iv. Subjects the child or allows him to be
subjected to acts of Lasciviousness.
 The grounds enumerated above are
deemed to include cases which have
resulted from culpable negligence of the
parent or the person exercising parental
authority (Id. at 338-339; FAMILY CODE,
Art. 231).
d. Attempt by one of the parents against the
life of the other, unless there has been
reconciliation between them (CIVIL CODE,
Art. 920, Par.2).
NOTE: Final judgment of conviction is not
necessary (JURADO, Succession, supra at
340).
3. Spouse: (LP)
a. When the spouse has given cause for Legal
separation (FAMILY CODE, Art.55); and
NOTE: Criminal conviction is not a condition
sine qua non (JURADO, Succession, supra
at 342), Neither is a decree of legal
separation (3 PARAS, supra at 399).
b. When the spouse has given grounds for the
loss of Parental authority (CIVIL CODE, Art.
921).
GROUNDS FOR REVOCATION OF
DISINHERITANCE: (RIN)
1. Reconciliation;
2. Making of new will making the disinherited heir
an Instituted heir.; and
3. Nullity of the will which contains the
disinheritance (3 PARAS, supra at 402).
The fact that a void will containing a disinheritance
is denied probate cannot be said to revoke a
disinheritance for there never was a valid
disinheritance. Hence, there is nothing to revoke
(Id.).
Once disinheritance has been revoked or rendered
ineffectual, it cannot be renewed except for causes
subsequent to the revocation or based on new
grounds (3 TOLENTINO, supra at 373).
RECONCILIATION
It is either an express pardon extended by the
testator to the offending heir or unequivocal conduct
of the testator towards the offending heir which
reveals the testator’s intent to forgive the offense
(BALANE, Succession, supra at 402).
It implies mutual restoration of feelings to the status
quo, that is, to the relationship existing prior to the
commission of the act which strained said
relationship (3 PARAS, supra at 399).
If the parents should again live together in the same
house, reconciliation between them is thereby
presumed (Id. at 399).
Reconciliation = Pardon + Acceptance of Pardon
Pardon by the testator must have been accepted by
the offender, thus resulting in a reconciliation
between the two (JURADO, Succession, supra at
343).
1. If express pardon – A general pardon extended
by the testator on his deathbed to all who have
offended him will not suffice; it must be a pardon
expressly and concretely extended to the
offender, who accepts it (BALANE, Succession,
supra at 402 citing 6 Manresa, Op. Cit., p. 567).
2. If conduct – the intent to forgive must be clear.
This is ultimately “a question of fact (which) will
be resolved, in case of controversy, by the
courts” (Id.).
No particular form is required. It may be made
expressly or tacitly (3 PARAS, supra at 401).
Effects of Subsequent Reconciliation:
1. Deprives the offended party of the right to
disinherit; and
2. Renders ineffectual any disinheritance that may
have been made (CIVIL CODE, Art. 922).
Effect of Subsequent Reconciliation if ground for
Disinheritance is Unworthiness to Succeed
1. If disinheritance has been made: Rule on
reconciliation applies. The disinheritance
becomes ineffective (CIVIL CODE, Art. 922).
NOTE: If the cause of unworthiness was made
a ground for disinheritance and there is
reconciliation, the mere fact of reconciliation
extinguishes the unworthiness and no written
document is needed for a condonation (3
PARAS, supra at 402).
2. If disinheritance has not been made: Rule on
reconciliation does not apply. If the cause of the
disinheritance is also a cause of unworthiness,
the heir continues to be incapacitated to
succeed unless pardoned by the testator under
Art. 1033 of the Civil Code (Id.).
RIGHT OF REPRESENTATION IN
DISINHERITANCE
The children and descendants of the person
disinherited shall take his or her place and shall
preserve the rights of compulsory heirs with respect
to the legitime only (CIVIL CODE, Art. 923).
NOTE: The right of representation extends only to
the legitime. If the disinherited person had been
given any legacy, devise, or part of the free disposal,
same will go to the substitutes, if any; if none, to the
other heirs, legatees, or devisees by accretion if
proper; if accretion is not proper, same should go to
the legal heirs by intestacy (3 PARAS, supra at 404).
In testamentary succession, the right of
representation can take place only in the direct
descending line, but never in the ascending
(JURADO, Succession, supra at 344).
LEGACIES AND DEVISES
(ARTS. 924-959)
PERSONS CHARGED WITH LEGACIES
AND DEVISES:
1. Compulsory heir;
2. Voluntary heir;
3. Legatee or devisee; and
4. Estate (JURADO, Succession, supra at 345).
If the will is silent as to who shall pay or deliver the
legacy/devise:
1. If there is an administration proceeding, it
constitutes a charge upon the estate.
2. If there are no administration proceedings, it is a
charge upon the heirs (Id.).
NOTE: A legacy is “bequeathed”; while a devise is
“devised” (3 PARAS, supra at 404).
EXTENT OF LIABILITY OF
LEGATEES/DEVISES
The legatees/devisees shall be liable for the charge
to the extent of the value of the legacy/devise
received (JURADO, Succession, supra at 345-346).
LIABILITY WHEN NO ONE IS CHARGED
Should the testator not charge any legatee or
devisee in particular, all shall be liable in the same
proportion in which they may inherit (Id at 346).
The payment of a legacy provided for in a will cannot
be ordered by the court unless the estate of the
deceased has first been liquidated, i.e., the assets
determined and all debts, taxes and expenses have
been paid (Pastor, Jr. v. Court of Appeals, G.R. No.
L-56340, June 24, 1983).
PRINCIPLE OF UNTOUCHABILITY OF
THE LEGITIME OF COMPULSORY HEIR
The compulsory heir shall not be liable for the charge
beyond the disposable portion given to him (CIVIL
CODE, Art. 925, par. 2). It should not affect his
legitime.
Compulsory heirs charged with a sub-legacy are
liable in proportion not to how much each actually
inherits, but only in proportion to their institution to
the free disposal (3 PARAS, supra at 407).
Illustration: T has an estate of P1 million. A and B,
T’s legitimate children, were instituted in this way: A
to 3/5 and B to 2/5. However, they were required to
give F a legacy of P50,000. How much should each
contribute?
A: A was given P600,000 (250,000 as legitime and
P350,000 as free portion); B was given P400,000
(P250,000 as legitime and P150,000 as free
portion). Since their institution to the free portion is
in proportion of P350,000 to P150,000 (or 35 to 15),
it follows that of the P50,000 sub-legacy, A must give
P35,000 and B must give P15,000 (Id.).
Example of Sub-legacy or Sub-devises
The testator said, “I give my car to L, but I want L to
give P500,000 to X”.
NOTE: The legacy of the car to L is an ordinary
legacy; but the legacy of P500,000 to X is a sub-
legacy having been imposed upon L (Id.).
LIABILITY FOR EVICTION
1. If devise or legacy is indeterminate or
generic: The heir who is charged with the
payment or delivery of the devise or legacy shall
be liable in case of eviction.
2. If devise or legacy is determinate or specific:
The heir who is charged cannot be held liable in
case of eviction (JURADO, Succession, supra
at 346-347).
NOTE: If the legacy or devise is a burden not on the
heir but on the estate itself, there is no warranty
against eviction, whether the legacy be specific or
generic, if there were court proceedings which
ordered the giving of such legacy or device. In this
case, there was court approval (3 PARAS, supra at
409).
SOLIDARY LIABILITY OF HEIRS WHO
TAKE POSSESSION
If two or more heirs take possession of the estate,
they shall be solidarily liable for the loss or
destruction of a thing devised or bequeathed, even
though only one of them should have been negligent
(CIVIL CODE, Art. 927).
LEGACY/DEVISE OF THINGS
BELONGING TO ANOTHER
1. If there was an erroneous belief on the
part of the testator that the property or
thing bequeathed was his:
The legacy or devise shall be void because you
cannot give what you do not possess or own
(JURADO, Succession, supra at 349).
NOTE: But if the thing bequeathed, though not
belonging to the testator when he made the will,
afterwards becomes his, by whatever title, the
disposition shall take effect (CIVIL CODE, Art.
930). The acquisition by subsequent title is an
example of an acquisition between the time of
the making of the will, and the testator’s death.
This would be justified since after all, the will
becomes effective only at the time the testator
dies (3 PARAS, supra at 412).
2. If the testator knew that the property or
thing belonged to another:
The legacy or devise shall be valid.
Consequently, there shall be a presumption that
the thing must be acquired by the executor or
administrator or by an heir expressly charged
with such obligation (JURADO, Succession,
supra at 349-350).
LEGACY/DEVISE OF THINGS
BELONGING PARTLY TO ANOTHER
GENERAL RULE: The legacy or devise shall be
understood to be limited to the testator, heir, or
legatee’s part or interest (CIVIL CODE, Art. 929).
EXCEPTION: Testator may expressly declare that
he bequeaths or devises the thing in its entirety
(JURADO, Succession, supra at 347).
Requisites: (EK)
1. An Express declaration to that effect appearing
in the will itself; and
2. Knowledge on the part of the testator that the
thing belongs partly to a third person (can be
proven from the context of the will or from
extrinsic evidence) (Id.).
NOTE: For the exception to apply, the testator must
“expressly declare that he gives the thing in its
entirety.” This clause has been interpreted to mean
that the whole is being given despite the testator’s
knowledge that he does not own the entire thing. If
the testator thought he owned the whole thing, and
he says that he gives the whole thing, only the part
that he owns should be given, the rest being a void
legacy, unless of course, subsequent to the making
of the will, he becomes the owner of said remainder
– “by whatever title” (3 PARAS, supra at 410).
An order to acquire the unowned part is not essential
for it is sufficient for the declaration to be express
(Id.).
EFFECTS OF PARTITION
In case of subsequent division or partition between
the owners in common:
1. If the thing is physically divisible or
convenient of division: Art. 929 of the Civil
Code applies.
2. If the thing is physically indivisible or
inconvenient of division: the rules applicable
shall depend upon whether the thing is finally
adjudicated to the testator or to the other owner
applying the provisions of Arts. 929 and 930 of
the Civil Code (JURADO, Succession, supra at
347-348).
EFFECTS OF PARTITION WHEN THE
PROPERTY IS NOT DIVISIBLE:
1. Adjudication to the testator
a. If testator did not bequeath the entire
property: the legacy or devise shall be
effective only as to the part formerly
belonging to the testator before the partition;
b. If testator bequeathed the entire
property: the whole property shall pass to
the heir, devisee or legatee (JURADO,
Succession, supra at 348).
2. Adjudication to a third person
a. If testator did not bequeath the entire
property: the legacy or devise shall be
without effect (CIVIL CODE, Art. 957).
b. If testator bequeathed the entire
property: the legacy or devise shall be
without effect only as to the part formerly
belonging to the testator but shall still be
effective with respect to the part of the third
person (JURADO, Succession, supra at
348).
In Art. 929, the stranger PARTIALLY owns the
property. In Art. 930, the stranger WHOLLY owns
the property (3 PARAS, supra at 412).
WHEN TESTATOR ORDERS
ACQUISITION
The heir upon whom the obligation is imposed or the
estate must acquire it and give the same to the
legatee or devisee; but if the owner refuses, or
demands an excessive price, the heir or estate shall
only be obliged to give the just value to the
legatee/devisee (CIVIL CODE, Art. 931).
NOTE: In Art. 931, the testator knows that he is not
the owner of the thing being given (3 PARAS supra
at 413).
LEGACY OF THINGS BELONGING TO
LEGATEE
The legacy or devise of a thing which at the time of
the execution of the will already belonged to the
legatee or devisee shall be ineffective even though
another person may have some interest therein
(CIVIL CODE, Art. 932, par. 1).
EFFECT OF ACQUISITION BY LEGATEE
(JURADO, SUCCESSION, SUPRA AT
351-352):
1. If the thing belonged to a third person at
the time of the execution of the will;
a. If the testator erroneously believed that
it was his: the legacy or devise shall be void
and the subsequent acquisition shall have
no effect.
b. If the testator had knowledge that it was
not his: the second paragraph of Art. 933 is
applicable.
i. If the legatee or devisee acquires it
gratuitously, he can claim nothing by
virtue of the legacy or devise.
ii. If the legatee or devisee acquires it by
onerous title, he can demand
reimbursement.
2. If the thing belonged to the testator at the
time of the execution of the will; and
a. If thing is alienated in favor of a third
person: legacy or devise is revoked by Art.
957 and the subsequent acquisition cannot
revive the legacy or devise.
b. If the thing is alienated in favor of the
devisee or legatee: there is no revocation.
3. If the thing belonged to the beneficiary at
the time of the execution of the will: the
legacy or devise shall be without effect,
even though it may have been
subsequently alienated by him (CIVIL
CODE, Art. 933, par. 1).
a. If the legatee or devisee acquires it
gratuitously after the execution of the will, he
can claim nothing by virtue of the legacy or
devise;
b. If it has been acquired by onerous title after
the execution of the will, he can demand
reimbursement from the heir or the estate
(CIVIL CODE, Art. 933, par. 2).
DISPOSITIONS IN GENERAL TERMS
A disposition made in general terms in favor of the
testator's relatives shall be understood to be in favor
of those nearest in degree (CIVIL CODE, Art. 959).
PLEDGED OR MORTGAGED
LEGACIES/DEVISES
When the thing bequeathed has been given as a
security for a recoverable debt, the estate shall be
obliged to pay the debt, unless a contrary intention
of the testator appears (CIVIL CODE, Art. 934, pars.
1-2). The legatee/devisee should receive it free from
the encumbrance (3 PARAS, supra at 418).
Any other charge, perpetual or temporary with which
the legacy/devise is burdened, passes to the
legatee/devisee (e.g. usufructs, easements, leases
which are real rights) (CIVIL CODE, Art. 934, par. 3).
LEGACY OF CREDIT AND REMISSION
OF DEBT
Legacy of Credit – takes place when the testator
bequeaths to the legatee a credit which he has
against a third person (CIVIL CODE, Arts. 935-937;
3 PARAS, supra at 421).
There is, in effect, a novation of the credit by
subrogating the legatee in the rights of the original
creditor (JURADO, Succession, supra at 354). If the
third person pays to the testator, the legacy or devise
shall be deemed to have been extinguished.
Example: T is D’s creditor for P1 Million. In his will,
T gave this credit to L (3 PARAS, supra at 421).
Legacy of Remission of Debt – waiver of a debt
existing at the time the will was made and in the
amount outstanding at the time of the death of the
testator (CIVIL CODE, Arts. 935-937; 3 PARAS,
supra at 422).
Example: T is D’s creditor for P1 Million. In his will,
was remitted this debt of D (3 PARAS, supra at 421).
NOTE: Effective only as regards to credit or debt
existing at the time of the death of the testator (CIVIL
CODE, Art. 935, par.1).
Kinds of Legacy of Remission of Debt
1. Generic – comprises all debts existing at the
time of the execution of the will but not
subsequent ones.
2. Specific – comprises only the debt which is
specifically mentioned in the will.
3. Legacy to the debtor of the thing pledged by him
(JURADO, Succession, supra at 354).
Revocation of Legacy
It takes place when the testator, after having made
the legacy of credit or remission of debt, brings a
judicial action against the debtor even if payment
should not have been effected at the time of death
(CIVIL CODE, Art. 936, par.1).
The legacy of credit shall be considered revoked
if the testator shall:
1. Bring an action against the debtor for payment
of his debt; and
2. There must be a judicial demand, hence an
extrajudicial demand shall not be sufficient to
revoke the legacy (JURADO, Succession, supra
at 355).
LEGACY TO CREDITORS
Legacy/devise made to creditor shall not be applied
to his credit, unless the testator provides otherwise
(CIVIL CODE, Art. 938).
ALTERNATIVE LEGACIES/DEVISES
Those where the testator bequeaths or devises two
or more things but which can be complied with by the
delivery of only one of them to the beneficiary
(JURADO, Succession, supra at 356).
To Whom Choice is Given:
1. The heir, upon whom the obligation to give the
legacy or devise is imposed; or
2. The executor or administrator, if no heir is
obliged (CIVIL CODE, Art. 940, par. 1).
NOTE: Choice will have to be made upon the death
of the testator. Once the choice is made, it is
irrevocable, and the legacy becomes simple
(JURADO, Succession, supra at 356).
If the heir, legatee or devisee dies before making the
choice, this right shall pass to their respective heirs
(Id. at 357).
The choice must be communicated to the recipient,
after which the communication the alternative legacy
becomes a simple one (3 PARAS supra at 427).
GENERIC LEGACIES AND GENERIC
DEVISES
Generic Legacy – legacy consisting of personal
property designated merely by its class or genus
without any particular or physical segregation from
all others of the same class (JURADO, Succession,
supra at 357-358).
Example: The testator bequeaths “10 horses” to A.
A legacy of generic personal property is valid even if
there be no such things of the same kind in the
estate (CIVIL CODE, Art. 941, par. 1).
Generic Devise – refers to a devise consisting of
real property designated merely by its class or genus
without any particular designation or physical
segregation from all others of the same class
(JURADO, Succession, supra at 358).
Example: The testator bequeaths 5 hectares of “rice
lands” to A.
A devise of indeterminate real property is valid only
if there be immovable property of its kind in the
estate (CIVIL CODE, Art. 941, par. 2).
WHEN RIGHT TO DEVISE OR LEGACY IS
TRANSMITTED
1. If specific – from the testator’s death
2. If generic – from the time a selection has been
made, so as to make the property specific
3. If alternative – from the time the choice has been
made
4. If acquired from a stranger by virtue of an order
by the testator – from the moment of such
acquisition (JURADO, Succession, supra at
360-362).
LEGACY FOR EDUCATION AND
SUPPORT (CIVIL CODE, ART. 944)
A legacy for education lasts until the legatee is of
age, or beyond the age of majority in order that the
legatee may finish some professional, vocational or
general course, provided he pursues his course
diligently.
A legacy for support lasts during the lifetime of the
legatee, if the testator has not otherwise provided.
If the testator has not fixed the amount of such
legacies, it shall be fixed in accordance with the
social standing and the circumstances of the legatee
and the value of the estate.
If the testator or during his lifetime used to give the
legatee a certain sum of money or other things by
way of support, the same amount shall be deemed
bequeathed, unless it be markedly disproportionate
to the value of the estate.
LEGACY/DEVISE SUBJECTED TO
SUSPENSIVE TERM
What is suspended by the term or period is not the
acquisition of the right but merely the demandability
of the right (JURADO, supra at 360).
LEGACY/DEVISE SUBJECTED TO A
SUSPENSIVE CONDITION
What is acquired upon the death of the testator by
the legatee/devisee is only a mere hope or
expectancy. Such hope or expectancy is converted
into a perfected right only from the moment of the
fulfillment of the condition (Id.).
If the legatee/devisee, after the death of the testator,
dies before the fulfillment of the condition, he cannot
transmit his expectancy to his own heirs (Id.).
CLASSIFICATION OF LEGACIES Effect on the
Status of Property Given by
1. As to effect Legacy/
Legatee/Devisee
Effect on the Devise
Status of Property Given by
Legacy/ a third person and the by virtue of the
Legatee/Devisee
Devise legatee/devisee acquired the legacy/devise
Belonging to the testator at the Effective property gratuitously after the
time of the execution of the will execution of the will (CIVIL
until his death. CODE, Art. 933).

Belonging to the testator at the Revoked Testator had knowledge that the Legatee/devisee
time of the execution of the will thing bequeathed belonged to a can demand
but alienated in favor of a third third person and the reimbursement
legatee/devisee acquired the from the heir or
person (CIVIL CODE, Art. 957).
property by onerous title (CIVIL estate
Belonging to the testator at the No revocation. CODE, Art. 933).
time of the execution of the will There is a clear
but alienated in favor of the intention to comply 2. As to validity
legatee/devisee gratuitously with legacy or
(JURADO, Succession, supra devise. Valid
at 352).
1. Within the commerce of man
Belonging to the testator at the Legatee/devisee 2. Owned by testator
time of the execution of the will can demand 3. Owned by stranger if there is an order, express
but alienated in favor of the reimbursement or implied, to acquire it from him
legatee or devisee onerously from the heir or 4. Given because of moral obligation
(Id). estate 5. Given as natural obligation
6. Generic personal property – even if there be
Not belonging to the testator at Effective
none in the estate
the time the will is executed but
he has ordered that the thing be Void ab initio
acquired in order that it be given
to the legatee/devisee (CIVIL 1. Outside the commerce of man
CODE, Art. 931). 2. Owned by stranger but mistakenly believed by
Not belonging to the testator at Void testator to be owned by the latter (unless later
the time the will is executed and owned by the latter)
the testator erroneously 3. Legacy in a void will
believed that the thing pertained 4. Generic real property if there be none of its kind
to him (CIVIL CODE, Art. 930). in the estate
5. If totally inofficious
Not belonging to the testator at Effective
the time the will is executed but Inoperative
afterwards becomes his by
whatever title (CIVIL CODE, Art. 1. Those revoked expressly
930). 2. Those revoked impliedly as when same
(legacy) is given to another by a subsequent
Already belonged to the Ineffective will
legatee/devisee at the time of 3. Those revoked by implication of law –
the execution of the will even transformation, alienation by testator except
though another person may when reacquired by right of repurchase or
have interest therein (CIVIL judicial demand
CODE, Art. 932). 4. Destruction or loss thru a fortuitous event
5. Intentional destruction by testator
Already belonged to the legatee Ineffective
6. Predecease, repudiation, incapacity of legatee
or devisee at the time of the
7. Disinheritance if legatee is compulsory heir
execution of the will even
though it may have been (3 PARAS, supra at 455-456).
subsequently alienated by him
(CIVIL CODE, Art. 933).
Testator had knowledge that the Legatee/devisee
thing bequeathed belonged to can claim nothing
 RULES ON PREFERENCE Form is the external appearance while
denomination is the name by which it is known
ART. 911 ART. 950 by all (JURADO, Succession, supra at 373).
Order of Preference
The transformation must be both with respect
(LIPO) (RPSESO) to the form and denomination (Id.).
1. Legitime of 1. Remuneratory L/D
compulsory heirs 1. Preferential L/D When the testator donates or sells the property
2. Donations Inter 2. L for Support bequeathed, there is implied revocation of the
vivos 3. L for Education disposition. The presumption under the law is
3. Preferential legacies 4. L/D of a Specific, that there has been a change of intention (3
or devices determinate thing PARAS, supra at 450-451).
4. All Other legacies or which forms a part
devices pro rata of the estate There arises a presumption that the testator’s
5. All Others pro rata. intention has changed (Id.).

Application 2. Revocation by Alienation

When the testator by any title or for any cause
1. When the reduction 1. When there are no alienates the thing bequeathed, or any part
is necessary to compulsory heirs thereof, it being understood that in the latter
preserve the and the entire estate case the legacy or devise shall be without effect
legitime of is distributed by the only with respect to the part alienated (CIVIL
compulsory heirs testator as legacies CODE, Art. 957, par.2).
from impairment or devises; or
whether there are 2. When there are GENERAL RULE: If the thing alienated should
donations inter vivos compulsory heirs but again belong to the testator even it be due to the
or not; or their legitime has nullity of the contract, there can be no revival of
2. When, although the already been the legacy/devise (CIVIL CODE, Art. 957, par.2).
legitime has been provided for by the
preserved by the testator and there EXCEPTION: The reacquisition was effected by
testator himself, are no donations the exercise of the right of
there are donations inter vivos (Id.). repurchase/redemption (CIVIL CODE, Art. 957,
inter vivos par.2).
(JURADO,
Succession, supra 3. Revocation by Loss or Destruction
at 363). Thing bequeathed is totally lost during the
lifetime of the testator, or after his death without
NOTE: In case of reduction in the above cases, the the fault of the heir/s (CIVIL CODE, Art. 957, par.
inverse order of payment should be followed. 3).

EFFECT OF INEFFECTIVE “Loss” refers both to both physical loss and legal
or juridical loss, as in expropriation proceedings
LEGACIES/DEVISES (3 PARAS supra at 453).
GENERAL RULE: In case of repudiation, revocation
or incapacity of the legatee or devisee, the 4. Revocation by bringing an action
legacy/devise shall be merged with the mass of the
hereditary estate.
against the debtor for payment of debt
(CIVIL CODE, Art. 936, par. 1).
EXCEPTION: In cases of substitution or accretion
(CIVIL CODE, Art. 956). 5. Other causes:
a. Nullity of the will;
b. Noncompliance with suspensive conditions
GROUNDS FOR REVOCATION OF affecting the bequests;
LEGACIES AND DEVISES c. Sale of the thing to pay the debts of the
1. Revocation by Transformation deceased during the settlement of his
When the testator or his agent transforms the estate; or
thing bequeathed in such a manner that it does d. Revocation of legacy of credit/remission of
not retain either the form or the denomination it debt (CIVIL CODE, Art. 957 in relation to Art.
had (CIVIL CODE, Art. 957, par.1). 830, par. 1).
 NOTE: The list is NOT exclusive (3 INTESTATE SUCCESSION VS.
TOLENTINO, supra at 428). COMPULSORY OR FORCED
A mistake in the name of the thing bequeathed SUCCESSION
or devised, is of no consequence, if it is possible
to identify the thing intended by the testator INTESTATE COMPULSORY
(CIVIL CODE, Art. 958). SUCCESSION SUCCESSION

A disposition made in general terms in favor of

the testator’s relatives shall be understood to be Founded on provisions Obligatory, regardless of
in favor of those nearest in degree (CIVIL of law as expressing the decedent’s desires or
CODE, Art. 959). the presumed will of wishes
the decedent
“Relatives” must be within the 5th degree, since
persons farther than this are no longer Suppletory to testate Takes place whether the
considered relatives. It is evident that relatives succession and takes deceased has left a will
by affinity are excluded (3 PARAS supra at 453). place only in default of or not and is therefore
the latter superior to and
independent of
testamentary succession
LEGAL OR INTESTATE Suppletory to and Superior to and
SUCCESSION takes place only in independent of testate
default of testate succession
(ARTS. 960-1014) succession

The heirs are called Heirs are called

LEGAL OR INTESTATE SUCCESSION
A mode of transmission mortis causa which takes
place in the absence of the expressed will of the
decedent embodied in a testament (3 TOLENTINO,
supra at 431).
CHARACTERISTICS:
1. Legal
– because it takes effect by operation of law.
2. Intestate
– because it takes place in the absence or in
default of a last will of a decedent (JURADO,
Succession, supra at 377).
BASIS: The law has put itself in the place of the
deceased and made what it presumes he would
have done if he had been able to express his will. It
has made the presumed will of the deceased the
basis of intestate succession, taking into
consideration human affection or love and blood
relationship (3 TOLENTINO, supra at 431-432).
legal or intestate heirs, compulsory heirs and
but they are not they are all legal heirs
necessarily
compulsory heirs (e.g.,
brothers and sisters)
(DE LEON, Succession, supra at 488-489;
CAGUIOA, Comments and Cases on Civil Law, p.
346 [hereinafter CAGUIOA, Civil Law]).
Causes of Intestacy: (SWIPER-P2AIR)
1. Non–fulfillment of Suspensive condition
attached to the institution of heir;
2. If a person dies without a Will, or with a void will,
or one which has subsequently lost its validity;
3. Incapacity of instituted heir;
4. Predecease of the instituted heir;
5. Expiration of term or period of institution;
6. Repudiation by the instituted heir;
7. Partial institution of heir, in which case, intestacy
takes place as to the undisposed portion (mixed
succession);
8. Preterition, in which case intestacy may be total
or partial depending on whether or not there are
legacies/devises;
9. Absence of an instituted of heir;
10. Non-compliance or Impossibility of compliance
with the will; and
11. Fulfillment of Resolutory condition (CIVIL
CODE, Art. 960; JURADO, Succession, supra at
378-379).
In all cases, where there has been an institution of
heirs, follow the (I.S.R.A.I.) order:
1. If the Institution fails, Substitution occurs.
2. If there is no substitute, the right of
Representation applies in the direct descending
line to the legitime if the vacancy is caused by
predecease, incapacity, or disinheritance.
3. The right of Accretion applies to the free portion
when the requisites in Art. 1016 are present.
4. If there is no substitute, and the right of
representation or accretion does not apply, the
rules on Intestate succession shall take over.
RULES ON INTESTATE SUCCESSION:
1. Rule of Preference Between Lines
Those in the direct descending line shall exclude
those in the direct ascending and collateral
lines, and those in the direct ascending line
shall, in turn, exclude those in the collateral line
(Id. at 380).
2. Rule of Proximity
The relative nearest in degree excludes the
more distant ones, saving the right of
representation when it properly takes place
(CIVIL CODE, Art. 962, par. 1).
This rule presupposes that all of the relatives
belong to the same line. It is subordinated to the
rule of preference between lines (e.g., although
the son and the father of the decedent are both
one (1) degree removed from the latter, the son
shall exclude the father) (JURADO, Succession,
supra at 381).
3. Rule of Representation
It modifies the Rule of Proximity. The more
distant relatives belonging to the same class as
the person represented are raised to the place
and degree of such person and acquire the
rights which the latter would have acquired if he
were living or if he could have inherited (Id. at
389).
It is the means by which the descendants of a
child, in default of the latter because of prior
death, disinheritance, or incapacity, can take his
degree or place. It is superior to right of accretion
(Id.).
Illustration: If the decedent is survived by his
son, A, and by his grandchildren, C and D,
children of a deceased, or incapacitated, or
disinherited child, B, under the law, C and D are
not excluded by A in the succession in spite of
the rule of proximity, because, by right of
representation, they are raised to the place and
degree of their deceased or incapacitated, or
disinherited father.
As a general rule, nephews and nieces are
excluded by a brother, but such exclusion is
nullified by representation. Thus if the decedent
is survived by his brother, X, and his nephews,
A and B, children of a deceased brother, Y, such
nephews shall still participate in the succession
by right of representation (Id. at 381).
4. Rule of Equal Division
Relatives in the same degree shall inherit in
equal shares (CIVIL CODE, Art. 962).
EXCEPTIONS:
a. Division in the ascending line (between
paternal and maternal grandparents);
b. Division among brothers and sisters, some
of whom are of the full and others of half-
blood;
c. Division in cases where the right of
representation takes place; and
d. Division between legitimate and illegitimate
children (DE LEON, Succession, supra at
497).
NOTE: This rule is subject to the rule of
preference between lines (JURADO,
Succession, supra at 381).
Illustration:
X is survived by his son, A, and his
grandchildren, D, E and F. D is the child of a
deceased son of X (B); E and F are the children
of another deceased son of (C).
It is clear that A shall inherit in his own right,
while the grandchildren shall inherit by right of
representation. D shall receive the share that
would have gone to his father if the latter were
alive; E and F shall also receive the share that
would have gone to their father if the latter were
also alive. Hence, although they are all two
degrees removed from the decedent, D shall
receive twice as much as either E or F (Id. at
382-383).
5. Rule of Barrier between the Legitimate incapacitated heir or heirs by right of accretion
Family and the Illegitimate Family (Iron (CIVIL CODE, Art. 968).
Curtain Rule)
The illegitimate family cannot inherit by intestate EXCEPTION: If the incapacitated heir happens to be
succession from the legitimate family and vice– a child or descendant of the decedent and he has
versa (CIVIL CODE, Art. 992). children or descendants of his own, then the share
which is rendered vacant by reason of incapacity
6. Rule of Double Share for Full Blood shall pass to such children or descendants by right
of representation (JURADO, Succession, supra at
Collaterals
386).
Should brothers and sisters of the full blood
survive together with brothers and sisters of the
half blood, the former shall be entitled to a share REPUDIATION
double that of the latter (CIVIL CODE, Art. 1. If by one or some of the relatives: his/their
1006). portion shall accrue to the others of the same
degree, save the right of representation when it
Children of brothers and sisters of the half-blood should take place (CIVIL CODE, Art. 968).
shall succeed per capita or per stirpes, in
accordance with the rules laid down for brothers 2. If by all of the relatives: those of the following
and sisters of the full blood (CIVIL CODE, Art. degree shall inherit in their own right. The
1008). inheritance shall be distributed among them per
capita (CIVIL CODE, Art. 969).
7. Rule of Division of Line
Decedent is survived by two (2) grandparents NOTE: In both instances, the right of representation
(GP) in the paternal line and one (1) GP in cannot be applied (JURADO, Succession, supra at
maternal, the inheritance shall be divided one 386).
half (½) to GPs in the paternal line, while one
half (½) to GP in the maternal line (CIVIL CODE, REASON: An heir who repudiates his inheritance
Art. 987). may not be represented (JURADO, Succession,
supra at 386).
RULES ON RELATIONSHIP:
Illustration (DE LEON, Succession, supra at 505):
1. Number of generations determines proximity;
2. Each generation forms a degree;
3. A series of degrees forms a line;
4. A line may be direct or collateral;
a. Direct Line
Constituted by the series of degrees among
ascendants and descendants (ascending
and descending).
b. Collateral Line
A, B, and C are the legitimate children of D. X and Y
Constituted by the series of degrees among
are the legitimate children of A; W, the legitimate
persons who are not ascendants or
child of B; and Z, the legitimate child of C. The value
descendants, but who come from a common
of the hereditary estate is P120,000.
ancestor.
1. If only B repudiates: A and C will get P60,000
5. Full blood (same father and mother) and half-
each. W is excluded because there is no right of
blood (only one of either parent is the same);
representation in case of repudiation (CIVIL
and (CIVIL CODE, Arts. 963 – 967).
CODE, Art. 977). X and Y are excluded by A,
6. In legal and intestate succession, the adopter(s)
and Z by C, because the nearer in degree
and the adoptee shall have reciprocal rights of
exclude the more distant (CIVIL CODE, Art.
succession without distinction from legitimate
962).
filiation. However, if the adoptee and his/her
biological parent(s) had left a will, the law on
2. If A, B, and C repudiate the inheritance: There
testamentary succession shall govern (R.A.
being no right of representation, the estate will
8552, Sec. 18).
be divided among the four grandchildren
P30,000 each in their own right (CIVIL CODE,
INCAPACITY Art. 977).
GENERAL RULE: The share or shares which are
rendered vacant shall pass to the co-heirs of the
3. If A, B, and C are all incapacitated or
predeceased: The grandchildren will inherit by
right of representation and not in their own right.
Hence, X and Y will each get P20,000. W gets
P40,000 and Z gets P40,000. (CIVIL CODE, Art.
974 and Art. 982).
RIGHT OF ACCRETION
If there are several relatives of the same degree, and
one or some of them are unwilling or incapacitated
to succeed, his portion shall accrue to the others of
the same degree, save the right of representation
when it should take place (CIVIL CODE, Art. 968).
Illustration (DE LEON, Succession, supra at 503):
A, B, and C are legitimate children of D. X and Y are
A’s legitimate children. The value of the hereditary
estate is P60,000.
If A is incapacitated: A’s share of P20,000 shall
accrue to B and C unless a substitute has been
appointed by D in which case, the substitute shall get
P10,000, A’s share of the free portion. Hence, B and
C will each get P20,000 in his own right and P5,000
by virtue of accretion.
A right created by fiction of law, by virtue of which
the representative is raised to the place and degree
of the person represented, and acquires the rights
which the latter would have if he were living or if he
could have inherited (CIVIL CODE, Art. 970).
By virtue of this right, the relative nearest in degree
does not always exclude the more remote ones
(JURADO, Succession, supra at 389).
The representative does not succeed the person
represented but the one whom the person
represented would have succeeded (JURADO,
Succession, supra at 390).
CONSEQUENCES:
1. Representative must be capable of succeeding
the decedent;
2. Even if the representative is incapable of
succeeding the person represented, he can still
inherit by right of representation so long as he is
capable of succeeding the decedent; and
3. Even if the representative had repudiated his
inheritance coming from the person
represented, he can still inherit from the
decedent by right of representation (JURADO,
Succession, supra at 390).
NOTE: The subrogation or the representation
obtains degree by degree, the inferior one
representing the relative immediately higher in
degree. No jump is made.
There is transmission only with respect to
inheritance conferred by law.
In testamentary succession, it takes place only with
respect to the legitime (JURADO, Succession, supra
at 395).
WHEN REPRESENTATION TAKES
PLACE: (PID)
1. Predecease (testate and intestate);
2. Incapacity (testate and intestate); and
3. Disinheritance (testate succession) (JURADO,
Succession, supra at 390).
In testamentary succession, since a vacancy in the
inheritance occurs, the children or descendants of
the person represented are called to succeed by
right of representation. The person represented
must be a compulsory heir of the testator in the direct
descending line. (JURADO, Succession, supra at
390)
In legal or intestate succession, the basis, like that
of other rights of succession which take effect by
operation of law, is the presumed will of the
decedent (JURADO, Succession, supra at p. 391)
CHARACTERISTICS:
1. It is a right of subrogation;
2. It is an exception to the rule on proximity and
equal division among relatives of the same class
and degree;
3. The representative is called to the succession by
the law and not by the person represented;
4. The representative succeeds the decedent not
the person represented;
5. The representative must himself be capable of
inheriting from the deceased (3 PARAS, supra
at 477)
6. It can only take place when there is a vacancy in
the inheritance brought about by either
predecease, or incapacity, or disinheritance of
an heir; and
7. The right can be exercised only by the
grandchildren or descendants of the decedent
(JURADO, Succession, supra at 389-390).
REPRESENTATION IN DIRECT
DESCENDING LINE
It takes place in the direct descending line, but never
in the ascending line (CIVIL CODE, Art. 972).
Occurs in the Following Cases:
1. Children concur with grandchildren, the latter
being the children of other children who died
before the decedent or who are incapable of
succeeding the decedent;
2. All children are dead or are all incapable of
succeeding the decedent and grandchildren
concur with great-grandchildren, the latter being
the children of other grandchildren who died
before the decedent or who are incapable of
succeeding the decedent; and
3. All children are dead or are all incapable of
succeeding the decedent leaving children or
descendants of the same degree (JURADO,
Succession, supra at 392).
NOTE: In the descending line, the right of
representation is unlimited with regard to the
descendants who may succeed (3 TOLENTINO,
supra at 450).
REPRESENTATION IN COLLATERAL
LINE
An exceptional case where the right does not take
place in the direct descending line but in the
collateral line in favor of children of brothers and
sisters of the decedent, whether they may be of full
blood or half-blood (JURADO, Succession, supra at
392).
LIMITATIONS:
1. The right can be exercised only by nephews and
nieces of the decedent, whether they be of the
full blood or half-blood;
2. The right can be exercised by the nephews or
nieces of the decedent if they will concur with at
least one brother or sister of the decedent (CIVIL
CODE, Art. 975);
3. If the nephews and nieces are the only survivors,
they shall inherit in their own right and not by
right of representation (CIVIL CODE, Art. 972);
and
4. The right is possible only in intestate succession
(JURADO, Succession, supra at 392-393).
5. The right cannot be exercised by grandnephews
and grandnieces (Delgado Vda. De Dela Rosa
vs. Heirs of Marciana Rustia, G.R. No. 155733,
January 27, 2006).
Illustration: A and B are C’s brothers. D is the child
of A, and E
of B, while F is the child of D. C died without leaving
a will. A, B and D are likewise dead. May F inherit
from C?
Answer: F cannot inherit from C. True, he is a fourth
degree relative by blood of the decedent, but he is
excluded by E, a nephew, and therefore, a third
degree relative by blood of said decedent.
The right of representation does not take place in the
instant case. In the collateral line, representation
takes place only in favor of the children of brothers
and sisters, whether they be of the full or half blood
(CIVIL CODE, Art. 972), and only if they survive with
at least one uncle or aunt who is a brother or sister
of the decedent (CIVIL CODE, Art. 975). Both
conditions are not present here.
F is a grandnephew of the decedent C, not a
nephew. He concurs with a nephew of the decedent,
not with a brother or sister. Therefore, the only way
by which he can inherit would be in his own right.
Unfortunately for him, under the principle of
proximity recognized in Art. 962, he is excluded by E
(JURADO, Succession supra at p. 393).
REPRESENTATION BY ILLEGITIMATES
By virtue of Arts. 989 and 990, illegitimate child can
represent only when the parent represented is an
illegitimate child of the decedent (the representative,
the person represented, and the decedent are all
related to each other by illegitimate filiation
(JURADO, Succession, supra at 417).
An illegitimate descendant of a legitimate child
cannot represent the latter for Article 992 prevents
intestate succession between an illegitimate child
and the legitimate relatives of his father or mother
(DE LEON, Succession, supra at 971).
REPRESENTATION IN ADOPTION
GENERAL RULE: Adopted child succeeds to the
property of the adopter in the same manner as a
legitimate child.
If the adopting parent should die before the adopted
child, the latter cannot represent the former in the
inheritance from the parents or ascendants of the
adopter
The adopted child is not related to the parents or
ascendants of the adopter. Because the filiation
created by fiction of law is exclusively between the
adopter and the adopted (3 TOLENTINO, supra at
448).
The legitimate children and descendants of the
adopted child cannot represent him in the
succession to the estate of the adopting parent (Id.
at 448-449).
EXCEPTIONS (CIVIL CODE, Arts. 971 And 973):
1. An adopted cannot inherit from the legitimate
parents or ascendants of the adopter either by
representation or in his own right; and
2. The legitimate children or descendants of the
adopted cannot also inherit from the adopter
either by representation or in their own right (Id.
at 449).
The relationship established by adoption is limited when subsequently his grandfather dies (JURADO,
solely to the adopter and the adopted and does not Succession, supra 399-400).
extend to the relatives of the adopting parents or of
the adopted child except only as expressly provided REGULAR/NORMAL ORDER OF
for by law (Teotico v. Del Val, G.R. No. L-18753, SUCCESSION (DECEDENT IS A
March 26, 1965).
LEGITIMATE PERSON):
1. Legitimate children or descendants (LCD);
EFFECT UPON DIVISION OF ESTATE
2. Legitimate parents or ascendants (LPA);
Whenever there is succession by representation, the 3. Illegitimate children or descendants (ICD);
division of the estate shall be made per stirpes, in 4. Surviving spouse (SS);
such manner that the representatives shall not 5. Brothers and sisters, nephews and nieces
inherit more than what the person they represent (BS/NN);
would inherit, if he were living or could inherit (CIVIL 6. Other collateral relatives within the 5th degree
CODE, Art. 974). (C5); and
7. State (JURADO, Succession, supra at 401).
TESTAMENTARY INTESTATE
SUCCESSION SUCCESSION IRREGULAR/ABNORMAL ORDER OF
SUCCESSION (DECEDENT IS AN
The representative He acquires all of the
acquires all of the rights rights which the person ILLEGITIMATE PERSON):
which the person represented had with 1. Legitimate children or descendants (LCD);
represented had with respect to his entire 2. Illegitimate children or descendants (ICD);
respect to his legitime. legal portion. 3. Illegitimate parents (IP);
4. Surviving spouse (SS);
(JURADO, Succession, supra at 395) 5. Brothers and sisters, nephews and nieces
(BS/NN); and
SUCCESSION BY NEPHEWS AND 6. State (Id. at 401-402).
NIECES
When children of one or more brothers or sisters of The order of intestate succession is based both on
the deceased survive, they shall inherit from the the principle of exclusion and the principle of
latter by representation, if they survive with their concurrence (Id. at 403).
uncles or aunts. But if they alone survive, they shall
inherit in equal portions (CIVIL CODE, Art. 975). PRINCIPLE OF EXCLUSION
Where nephews or nieces concur with their uncles The heirs higher in the order of succession exclude
or aunt, the former inherit by right of representation those who were lower in that order of succession,
(per stirpes), while the latter in their own right (per except that when the latter are compulsory heirs they
capita) (DE LEON, Succession at 512). preserve their rights to legitime (3 TOLENTINO,
supra at 457).
Where nephews or nieces alone survive, without any
uncle or aunt, they inherit in their own right, and The principle of exclusion is still applied literally to
therefore, the division among them is per capita (Id.). the case of parents or ascendants, collateral
relatives, and the State. In the case of others, the
PER STIRPES PER CAPITA principle of concurrence applies (JURADO,
Succession, supra at 403).
Succession is by group, Succession is by head
with all those in the or one’s own rights, with PRINCIPLE OF CONCURRENCE
same degree within the descendants in the Under the principle of concurrence, the illegitimate
group inheriting in equal same degree inheriting children and the surviving spouse, who are not only
shares. equally. legal or intestate heirs but are also primary
(Id. at 511) compulsory heirs, even when they concur with
legitimate children and descendants or with
legitimate parents and ascendants, are not only
REPUDIATION BY REPRESENTATIVE entitled to their legitime, but are also given a share
A person may represent him whose inheritance he in the disposable free portion (Id.).
has renounced (CIVIL CODE, Art. 976).
Illustration: X is the testator. He has A & B as his
If a child renounces or repudiates his inheritance legitimate children and C as an illegitimate child. His
when his father died, he may still represent the latter, net estate is P80,000.
Following the rules on intestate succession, A & B SURVIVOR INTESTATE DIVISION
shall jointly receive half of the estate which is SHARE
P40,000 so each will get P20,000. C, on the other
hand, being an illegitimate child shall only receive insufficient,
P10,000. There shall be an excess of P30,000. How reduction must
shall the P30, 000 be divided? be made
according to
1. Exclusion theory: The P30,000 shall be divided the rules on
by A & B only. legitime. The
2. Concurrence theory: The P30,000 shall be legitime of LCD
divided among A, B & C. and SS shall
always be first
TABLE OF INTESTATE SHARES satisfied in
SURVIVOR INTESTATE DIVISION preference to
SHARE that of the ICD.

Any class Entire estate Rule of Proximity NOTE: The

alone (Art. 962 of the legitime of each
Civil Code) illegitimate
child shall
LCD; Entire estate; Rule of Proximity consist of 1/2 of
LPA Excluded (Art. 962 of the the legitime of
Civil Code) a legitimate
child (Art. 176,
1 LCD; 1/2; (Arcenas v. Cinco, Family Code)
SS 1/2 G.R. No. L-29288,
November 29, 2 or more First, satisfy the Concurrence or
1976) LCD; legitime. In Exclusion Theory
SS; case of excess
2 or more Consider SS as Concurrence ICD in the estate,
LCD; 1 LCD, and Theory distribute such
SS then divide excess in the
estate by total proportion
number. 2:2:1, in
accordance
LPA; 1/2; Art. 997 of the with the
SS 1/2 Civil Code concurrence
LPA; 1/2; Art. 991 of the theory.
ICD 1/2 Civil Code
1. DESCENDING DIRECT LINE
ICD; 1/2; Art. 998 of the
SS 1/2 Civil Code Includes Legitimate CD, Legitimated CD and
adopted children (JURADO, Succession, supra
LPA; 1/2; Art. 1000 of the at 404).
SS; 1/4; Civil Code
ICD 1/4 Legitimate children from the first and second
marriages are entitled to inherit, and failure to
IP; 1/2; The law is silent. include anyone of them makes the extrajudicial
SS 1/2 Apply settlement void (Neri v. Heirs of Uy, G.R. No.
concurrence 194366; October 10, 2012).
theory (JURADO,
Succession, Rules of Division
supra at 410). If the decedent is survived by legitimate children
or descendants, the rules are as follows:
SS; 1/2; Art. 1001 of the a. If all of the survivors are legitimate children,
BS/NN 1/2 Civil Code such children shall inherit in their own right.
Consequently, the inheritance shall be
1 LCD; First, satisfy the Concurrence or
divided among them per capita or in equal
SS; legitime. If Exclusion Theory
shares.
ICD estate would be
 b. If some of the survivors are legitimate TABLE OF INTESTATE SHARES IN THE
children and the others are legitimate ESTATE OF AN ADOPTED
descendants of other legitimate children
who died before the decedent, the former SURVIVOR INTESTATE SHARE
shall inherit in their own right and the latter
shall inherit by right of representation. LCD; Ordinary rules of
Consequently, the inheritance shall be ICD; intestate succession.
divided among them per stirpes. SS 2:2:1
c. If all of the survivors are legitimate
LPA/IP; 1/2;
grandchildren, such grandchildren shall
Adopter 1/2
inherit by right of representation. Similarly, if
some of the survivors are legitimate SS; 1/2;
grandchildren and the others are legitimate Adopters 1/2
children or descendants of other legitimate
grandchildren who died before or who are ICD; 1/2;
incapable of succeeding the decedent, such Adopters 1/2
grandchildren and descendants shall inherit
by right of representation (JURADO, ICD; 1/3;
Succession, supra at 405-406). SS; 1/3;
Adopters 1/3
Illustration (DE LEON, Succession, supra at 521):
Adopters alone Entire

Ordinary rules of
Collateral alone
intestate succession.
(FAMILY CODE, Art. 190).

NOTE: Art. 984 of the Civil Code has been

A is the decedent. B, C, D are his children. E, F, G,
H and J are the grandchildren. K and L are J’s
children. Estate is P900,000. B, C, D, and J
predeceased A. Divide the property.
Answer: E, F and G will divide B’s share of
P300,000 equally. Each will get P100,000.
superseded by Art. 190 of the Family Code. Art.
190 of the Family Code applies only in legal or
intestate succession (DE LEON, Succession,
supra at 523-524).
2. ASCENDING DIRECT LINE
In default of legitimate children and descendants
of the deceased, his parents and ascendants
shall inherit from him, to the exclusion of
collateral relatives (CIVIL CODE, Art. 985).

H will get C’s share of P300,000.
K, L, and M will divide D’s share of P300,000, as
follows: K – P150,000, and L and M – P75,000 each.
a. Adopted Children
An adopted child succeeds to the property of the
adopting parents in the same manner as a
legitimate child (CIVIL CODE, Art. 979).
An adopted child is entitled to all the rights and
obligations provided by law to a legitimate
sons/daughters born to the adopters without
discrimination of any kind (R.A. No. 8552 or the
Domestic Adoption Act of 1998, Sec. 17).
The adopter(s) and the adoptee shall have
reciprocal rights of succession without
distinction from legitimate filiation in legal and
intestate succession (R.A. No. 8552 or the
Domestic Adoption Act of 1998, Sec. 18).
The share of the parents or ascendants may be
subject to reserva troncal in cases where the
requisites are present.
Rules of Division
a. In default of the mother and father, the rule
of proximity shall be applied. In other words,
the ascendants nearest in degree shall
inherit.
b. Should there be more than one equal
degree belonging to the same line, they
shall divide the inheritance per capita
(JURADO, Succession, supra at 415).
Illustration: If descendant is survived only by A,
paternal grandfather, and B and C, maternal
grandparents, ½ of the entire inheritance is
given to A, while the other half shall be given to
B and C, which they shall divide per capita (Id.).
3. ILLEGITIMATE CHILDREN b. E cannot represent B in the succession from
Illegitimate children exclude collaterals, in this A’s estate (CIVIL CODE, Art. 992).
sense, they are superior to the surviving spouse c. Both F and G can represent C who is
(Id. at 416). illegitimate (CIVIL CODE, Art. 990).

Principle of Absolute Separation Between 4. SURVIVING SPOUSE

the Legitimate Family and the Illegitimate He or she shall always inherit. The universal rule
Family (Barrier or Iron Curtain Rule) is that a legal heir who is also a primary
An illegitimate child has no right to inherit ab compulsory heir (surviving spouse) at the same
intestato from the legitimate children and time is always entitled to the legitime which the
relatives of his father or mother; neither shall law has reserved (JURADO, Succession, supra
such legitimate children or relatives inherit in the at 426).
same manner from the illegitimate child (CIVIL
CODE, Art. 992). Surviving spouse is placed in the same category
as each of the legitimate children state (Id.).
An impassable barrier exists separating or
dividing the members of legitimate family from TABLE OF SHARES (SURVIVING
those of the illegitimate family (JURADO, SPOUSE/SS)
Succession, supra at 419).
SS SURVIVES WITH INTESTATE SHARE
REASON: Intervening antagonism and
incompatibility between members of the SS gets the same share
legitimate family and those of the illegitimate LCD as that of each child
family (Id). (CIVIL CODE, Art. 996).

1. SS: ½
NOTE: Succession to the estate does not go
2. Parents/ascendants:
beyond the parents by nature (Id. at 422). LPA
½ (CIVIL CODE, Art.
997).
When the law speaks of brothers and sisters,
nephews and nieces, as legal heirs of an 1. SS: ½
illegitimate child, it refers to illegitimate brothers 2. Illegitimate children
and sisters as well as the child whether lCD or ICD’s
or illegitimate
legitimate or illegitimate of such brothers and descendants (whether
children’s
sisters legitimate or
descendants: ½
illegitimate)
(CIVIL CODE, Art.
In default of brothers and sisters, nephews and 998).
nieces, the law does not go any farther, other
collaterals are not allowed to inherit by intestate 1. LCD/s: ½
succession from the illegitimate child, the entire LCD/s and ICD/s or 2. SS:1 LCD;
estate shall pass to the state (JURADO, their descendants 3. ICD: ½ of 1 LCD
Succession, supra at 425). (whether legitimate or
illegitimate) If only 1 LCD: 2:2:1
Illustration (DE LEON, Succession, supra at (CIVIL CODE, Art. 999).
533):
1. LPA: ½
2. SS: ¼
LPA and IC
3. ICD: ¼ (CIVIL
CODE, Art. 1000).

1. SS: ½
BS/NN 2. BS/NN: ½ (CIVIL
CODE, Art. 1001).

In case of a legal separation, if the surviving

B and C predecease A, decedent. D, E, F, and
G are the four grandchildren who survived.
a. D can represent his father B in the
succession from X’s estate.
spouse gave cause for the legal separation, he
or she shall not have any of the rights granted in
the preceding articles (CIVIL CODE, Art. 1002).
Illustration: If the decedent, for instance, is
survived by his widow and four legitimate
 children, and the inheritance is P60,000, the
method of distribution would be merely to divide
the P60,000 by five. The result would be
P12,000 for each, of the survivors (JURADO,
Succession, supra at 426).
5. COLLATERAL RELATIVES
They can only refer to those within the fifth
degree (CIVIL CODE, Art. 1010).
Rule of Proximity (CIVIL CODE, Art. 962).
GENERAL RULE: Where two (2) or more
collaterals concur in the succession, the nearest
in degree shall exclude the more remote one.
EXCEPTION: Right of Representation in the
collateral line is recognized but extended only to
nephews and nieces.
Rule of Preference
Where survivors are of the same degree, the
Rule of Preference by reason of relationship by
the whole blood is also recognized but can be
applied only to brothers and sisters or nephews
and nieces and not to other collaterals
(JURADO, Succession, supra at 445). This
means that should brothers and sisters of the full
blood survive together with brothers and sisters
of the half blood, the former shall be entitled to a
share double that of the latter (CIVIL CODE, Art.
1006).
Should brothers and sisters survive together
with nephew and nieces, who are children of the
decedent’s brothers and sisters of the full blood,
the former shall inherit per capita, and the latter
per stirpes (CIVIL CODE, Art. 1005).
If the only survivors are nephews and nieces of
the full or of the half blood, they shall succeed to
the entire inheritance in their own right. The rule
of preference by reason of blood relationship
may be applied (JURADO, Succession, supra at
449). Which also means that nephews and
nieces of the full blood shall be entitled to a
share double that of the half-blood (CIVIL
CODE, Art. 1008).
6. STATE
Illustration (JURADO, Succession, supra at
448):
X is the decedent who is survived by:
a. A, a brother of the full blood;
b. D and E, nephews of the full blood, children of
B, another brother of the full blood who had
predeceased X; and
c. F and G, nephews of the half blood, children
of C, a brother of half-blood, who also had
predeceased X.
The decedent’s estate is P25,000. How shall it
be distributed?
Answer: The P25,000 shall be divided into three
shares in the proportion of 2:2:1 (CIVIL CODE,
Arts. 975, 1005, and 1006).
A shall be entitled to 2/5 of P25,000, or P10,000;
D and E shall also be entitled to 2/5 of P25,000
or P10,000, by right of representation; while F
and G shall be entitled to only 1/5, or P5,000, by
right of representation.
Consequently, the distribution shall be as
follows:
A = P10,000, in his own right
D = P5,000, by right of representation
E = P5,000, by right of representation
F = P2,500, by right of representation
G = P2,500, by right of representation
P25,000
Should there be neither brothers and sisters, nor
children of brothers and sisters, the other
collateral relatives shall succeed to the estate.
They shall succeed without distinction of lines or
preference among them by reason of
relationship by the whole blood (CIVIL CODE,
Art. 1009).
In default of LCD, PA, ICD, SS and collateral
relatives within the 5th degree (CIVIL CODE, Art.
1003).
In order that the State may take possession of
the property of the decedent, the procedure for
 Escheat (RULES OF COURT, Rule 91) must be Within five years from the date of the judgment
observed. (RULES OF COURT, Rule 91, Sec. 4).

Escheat CARDINAL PRINCIPLES OF INTESTATE

A proceeding, unlike that of succession or SUCCESSION
assignment, whereby the state, by virtue of its
1. Even if there is an order of intestate succession,
sovereignty, steps in and claims the real or
the Compulsory Heirs (CH) are never excluded.
personal property of a person who dies intestate
2. Right of Representation (RR) in the collateral
leaving no heir (Republic v. CA and Solano, G.R.
line occurs only in intestate succession; never in
No. 143483, January 31, 2002).
testamentary succession because a voluntary
heir cannot be represented as provided in Art.
Requisites for Escheat: (IP-No)
856 (1).
a. The decedent died Intestate;
3. The intestate shares are either equal to or
b. He dies seized of real and/or personal
greater than the legitime.
property located in the Philippines; and
4. GENERAL RULE: Grandchildren always inherit
c. He leaves no heir or person entitled to such
by RR, provided representation is proper.
real and personal property (JURADO,
EXCEPTION: Whenever all the children
Succession, supra at 453-454).
repudiate, the grandchildren inherit in their own
right because RR would not be proper.
PURPOSE: In the absence of a lawful owner, a
property is claimed by the state to forestall an
5. Nephews and nieces inherit either by RR or in
open "invitation to self-service by the first
their Own Right (OR).
comers” (RCBC v. Hi-Tri Development
a. RR: when they concur with aunts and uncles
Corporation, G.R. No. 192413, June 13, 2012).
(provided that RR is proper).
b. OR: when they do not concur with aunts and
Assignment of Property
uncles.
If personal property, it is the city or municipality
where the deceased last resided in the Philippines
6. ICD of legitimates cannot represent because of
(CIVIL CODE, Art. 1013).
the barrier, but both the ICD and LCD of
illegitimates can.
If real property, it is the city or municipality in which
7. There can be reserva troncal in intestate
the property is situated (CIVIL CODE, Art. 1013).
succession.
8. A renouncer can represent, but cannot be
EXCEPTION: If the deceased never resided in the
represented (CIVIL CODE, Art. 976).
Philippines – respective cities or municipalities
9. A person who cannot represent a near relative
where the real or personal property is located (CIVIL
cannot also represent a relative farther in degree
CODE, Art. 1013).
(3 PARAS, supra at 531-533).
NOTE: Such estate shall be for the benefit of public
schools and public charitable institutions and
centers in such municipalities or cities. The court
shall distribute the estate as the respective needs of MIXED SUCCESSION
each beneficiary may warrant (CIVIL CODE, Art.
1013).
AND PARTIAL
INTESTACY
The court, at the instance of an interested party, or
on its own motion, may order the establishment of a
permanent trust, so that only the income from the
property shall be used (CIVIL CODE, Art. 1013). MIXED SUCCESSION
Succession that is effected partly by will and partly
When to File a Claim by operation of law (CIVIL CODE, Art. 780).
A person who is legally entitled to the estate of the
deceased may, within five years from the date the In other words, if the testator makes a will which
property was delivered to the State, file a claim for does not dispose all of his property, the result is what
the possession of the same, or if sold, the city or is known as mixed succession (JURADO,
municipality shall be accountable to him for such part Succession, supra at 16).
of the proceeds as may not have been lawfully spent
(CIVIL CODE, Art. 1014). The rules of legal intestate succession shall be
applied with respect to those properties not disposed
of (Id. at 378).
Rules:
1. The legitimes of compulsory heirs shall be
applied even in mixed succession. One who has
compulsory heirs may dispose of his estate
provided he does not contravene the provisions
of this code with regard to the legitime of said
heirs (CIVIL CODE, Art. 842, par. 2).
2. In case the testamentary disposition reduces the
legitime, the reduction shall be borne pro rata by
all intestate heirs from their shares in the
disposable portion but never from the legitimes
(3 PARAS, supra at 479).
Illustration:
If among the concurring intestate heirs there are
compulsory heirs whose legal or intestate
portions exceed their respective legitimes, then
the amount of the testamentary disposition must be
deducted from the disposable free portion to be
borne by all the intestate heirs in the proportions that
they are entitled to receive from such disposable free
portion as intestate heirs.
If the intestate share of a compulsory heir is
equal to his legitime, then the amount of the
testamentary disposition must be deducted only
from the intestate shares of the others, in the
proportions stated above.
devise, or to the same portion thereof, pro
indiviso; and
b. There must be a Vacancy in the inheritance,
legacy or devise (caused by predecease,
incapacity, repudiation, non-fulfillment of
suspensive condition, or void or ineffective
testamentary dispositions) (CIVIL CODE,
Art. 1016; JURADO, Succession, supra at
464).
Requisites of Art. 1016, No. 1 (Pro Indiviso):
(UPA)
a. Unity in the object, that is, a single thing
whether it be an inheritance, a portion of an
inheritance, or a specific thing;
b. Plurality in the subject matter, that is,
several persons, heirs or legatees called to
that single thing; and
c. Absence of any designation as to the share
of each in the thing (CAGUIOA, Civil Law,
supra at 413)
How to Avoid Accretion:
a. By expressly designating a substitute; and
b. By expressly providing that although
accretion may take place, decedent does
not want accretion to occur (3 PARAS,
supra at 537).

If the testamentary dispositions consume the
entire disposable free portion, then the intestate
heirs who are compulsory heirs will get only their
legitime, and those who are not compulsory heirs will
get nothing.
NOTE: Accretion is a right (CIVIL CODE, Art.
1015), not an obligation, and may therefore be
accepted or repudiated by those entitled. This is
true in both testate and legal succession (Ynza
v. Rodriguez, et al., G.R. No. L-6395, June 30,
1954).

Effects of Predecease, Incapacity,

PROVISIONS COMMON Disinheritance, or Repudiation in both
Testamentary and Intestate Succession
TO INTESTATE AND
TESTATE SUCCESSION Legend:
RR – Right of Representation
(ARTS. 1015-1105) A – Right of Accretion
IS – Intestate Succession
S – Substitution

1. RIGHT OF ACCRETION Testamentary

When two (2) or more persons are called to the Intestate
Cause of Succession Successi
same inheritance, devise or legacy, the part
assigned to the one who renounces or cannot Vacancy Free on
receive his share, or who died before the Legitime
Portion
testator, is added or incorporated to that of his
co-heirs, co-devisees, or co-legatees (CIVIL 1. RR 1. A 1. RR
Predecease
CODE, Art. 1015). 2. IS 2. IS 2. IS

Requisites of Right of Accretion: (2V)

a. Two (2) or more persons must have been
called to the same inheritance, legacy or

Testamentary Intestate
Cause of Succession Successi
Vacancy Free on
Legitime
Portion
1. RR 1. A
Incapacity -
2. IS 2. IS
Disinheritanc 1. RR
_ _
e 2. IS
Repudiation 1. IS 1. A 1. A
(JURADO, Succession, supra at 470).
Summary of the Effects
a. Testamentary Succession
i. Legitime
(1) In case of predecease of an heir,
there is representation if there are
children or descendants; if none, the
others inherit in their own right.
(2) In case of incapacity, results are the
same as in predecease.
(3) In case of disinheritance, results are
the same as in predecease.
(4) In case of repudiation by an heir, the
others inherit in their own right.
ii. Disposable free portion
Accretion takes place when requisites in
Art. 1016, Civil Code are present; if not,
the others inherit in their own right.
b. Intestate Succession
i. In case of predecease, there is
representation if there are children or
descendants; if none, the others inherit
in their own right.
ii. In case of incapacity, results are the
same as in predecease.
iii. In case of repudiation, there is always
accretion (Id.).
NOTE: Whether the succession is testamentary
or intestate, if the right of accretion takes place,
the heirs to whom the vacant share or portion is
assigned shall divide it in the same portion that
they inherit (Id. at 468).
In testamentary succession, where the share
rendered vacant is the share of a compulsory
heirs, only that part of the share which is taken
from the disposable free portion shall pass to the
co-heirs by right to accretion.
In intestate succession, the entire share which is
rendered vacant shall pass to the co-heirs by
right of accretion (Id. at 468-469).
Illustration:
Testate Succession
Decedent D who has an estate of P3,000,000 is
survived by:
a. wife W;
b. children A, B, C;
c. parents, F and M;
d. illegitimate child IC, his child with girlfriend;
and
e. paternal grandfather and maternal
grandmother.
A has children, E and F while C has children, G,
H, and I. D instituted A to 1/2, B to 1/4 and C to
1/4 (to the free portion).
Assuming that C died, in case of predecease, his
share in the legitime will be given to G, H, I by
right of representation.
Will C’s share in the free portion be given to A
and B by right of accretion?
Answer: No. Art. 1016 requires that 2 or more
heirs must be called in the same inheritance pro
indiviso (jointly instituted). C’s share in the free
portion will go to D’s legal heirs pursuant to Art.
1022 of the Civil Code, which provides that in
testamentary succession, when the right of
accretion does not take place, the vacant portion
of the instituted heirs, if no substitute has been
designated, shall pass to the legal heirs of the
testator, who shall receive it with the same
charges and obligations.
If C is incapacitated to succeed under Art. 1028
or 1027, to whom shall you give the 500k
legitime? Will it be given to G, H, I?
Answer: No. C will still receive his legitime, if he
is incapacitated under Art. 1027 or 1028; he will
only be rendered incapacitated as to the free
 portion. The free portion shall be distributed (1) Testamentary disposition in favor of
pursuant to Art. 1022. associations for religious, scientific,
cultural, educational, or charitable
If the incapacity is under Art. 1032, his share will purposes (CIVIL CODE, Art. 1026).
now be given to G, H, I because unworthiness (2) Testamentary disposition in favor of
now affects both the legitime and free portion. a church or denomination to which
the testator may belong for prayers
Intestate Succession or pious works (CIVIL CODE, Art.
1029).
(3) Testamentary disposition in favor of
the poor in general (CIVIL CODE,
Art. 1030).
(4) When the child although not yet born
is already conceived at the time of
the death of the decedent and it is
born later under the conditions
prescribed in the Civil Code, Art. 41.
ii. Those who cannot be identified –
uncertain persons (Persona Incierta)
(CIVIL CODE, Art. 845).
iii. Those who are not permitted by law to
inherit (CIVIL CODE, Art. 1027, par. C,
No. 6).
Decedent D who has an estate of P3,000,000 is
survived by his wife W, children A, B, C, and
b. Relative Incapacity– by reason of special
parents, F and M. A has children, E and F while
relation.
C has children, G, H, and I.
i. Based on Undue Influence or
Interest: (PR-GAP)
If C repudiates, A and B will get 1.5M each by
1. Priest who heard the confession of
right of accretion. C, who repudiated, cannot be
the testator during his last illness, or
represented (CIVIL CODE, Arts. 687 and 977).
the minister of the gospel who
extended spiritual aid to him during
If C predeceases, his share will go to G, H, I by
the same period (CIVIL CODE Art.
right of representation (CIVIL CODE, Art. 968
1027, par. 1).
and 972).
Requisites: (EDI)
If I predeceases, his share will go to G and H by
a. The will must have been
right of accretion (CIVIL CODE, Art. 968).
Executed during the last illness
and after the confession
Now for the ascending line, assuming this time
because if it were before, the
that there is also paternal grandfather GF and
reason for the incapacity does
maternal grandmother MGM. If F predeceases,
not exist;
by right of accretion,
b. That the testator Died of the
illness wherein the confession
2. CAPACITY TO SUCCEED BY WILL was made even though there
OR INTESTACY should exist an interval
Requisites: (LE-Not-ID) between the confession and the
a. The heir, legatee/devisee must be Living or death or that the death proceed
in Existence at the moment the succession from an accident which may or
opens; and may not proceed from said
b. He must not be Incapacitated or illness; and
Disqualified by law to succeed (JURADO, c. That the disposition in the will
Succession, supra. at 481). should be In favor of said priest
or minister, his relative within
Kinds of Incapacity to Succeed: the fourth (4th) degree or his
a. Absolute Incapacity– incapacitated to church (CAGUIOA, Civil Law,
succeed in any form. supra at 425).
i. Those not living at the time of death,
except: The basis of disqualification is
the presumption that at the
 threshold of death the testator
becomes an easy prey to the
scheming priest or minister
(JURADO, Succession, supra
at 484).
According to Sanchez Roman,
should the testator recover from
his last illness and does not
revoke the disposition, the
disposition is still invalid. The
only way to make it valid is to
reproduce the invalid
disposition to a new will.
Contrary views, however, state
that if the testator fully
recovered from his last illness
and there is sufficient time for
him to revoke the will and yet he
did not do so, the same shall be
considered as valid (CAGUIOA,
Civil Law, supra at 424).
2. Relatives of such priest or minister of
the gospel within the 4th degree, the
church, order, chapter, community,
organization or institution to which such
priest or minister may belong (CIVIL
CODE, Art. 1027, par. 2).
The law does not include among the
persons disqualified the spouse of the
priest or minister (JURADO,
Succession, supra at 485).
3. Guardian with respect to testamentary
dispositions given by a ward in his favor
before the final accounts of the
guardianship have been approved,
even if the testator should die after the
approval thereof; nevertheless, any
provision made by the ward in favor of
the guardian when the latter is his
ascendant, descendant, brother, sister,
or spouse, shall be valid (CIVIL CODE,
Art. 1027, par. 3).
Not applicable if the guardian is an
ascendant, descendant, brother, sister,
or spouse of the testator (JURADO,
Succession, supra at 485).
Requisites:
a. The will was executed by the ward
in favor of the guardian; and
b. It was executed before the final
accounts of the guardianship have
been approved; even if the testator
should die after the approval thereof
(3 PARAS, supra at 573).
Characteristics:
a. Possible only in testamentary
succession;
b. Relative in character; and
c. Partial, in the sense that if the heir
who is incapacitated or disqualified
is a compulsory heir, only the free
portion given to him is affected, but
not his legitime (JURADO,
Succession, supra at 483-484).
NOTE: The incapacity of the guardian
only exists prior to the rendition of final
accounts and the approval thereof since
the law wants to prevent the guardian
from aspiring to the inheritance to cover
up any mismanagement during his
guardianship. Therefore, the
determining factor is the final approval
of the final accounts. If there is such
approval, the guardian is not
incapacitated but if there is no such
approval, the guardian is incapacitated
(CAGUOIA, Civil Law, supra at 425).
4. Attesting witness to the execution of a will,
the spouse, parents or children, or any one
claiming under such witness, spouse,
parents, or children (CIVIL CODE, Art. 1027,
par. 4).
Such disqualification does not apply “if there
are three other competent witness” to the
execution of the will (CIVIL CODE, Art. 823).
5. Physician, surgeon, nurse, health officer or
druggist who took care of the testator during
his last illness (CIVIL CODE, Art. 1027, par.
5).
The disqualification does not extend to the
relatives of the physician or nurse, or to the
organization or institution to which such
physician or nurse may belong (JURADO,
Succession, supra at 486).
Not applicable if the one who took care of
the testator is his spouse, ascendant or
descendant (Id.).
ii. Based on Morality or Public Policy
The provisions mentioned in Art. 739 of
the Civil Code, concerning donation
inter vivos shall apply to testamentary
provisions (CIVIL CODE, Art. 1028).
The following donations are VOID:
(ACP)
(1) Those made in favor of a person
with whom the testator was guilty of
 Adultery or concubinage at the time
of the making of the will
(Nepomuceno v. CA, G.R. No. L-
62952, October 9, 1985; Joaquino
v. Reyes, G.R. No. 154645, July
13, 2004);
NOTE: Previous criminal conviction
is NOT necessary (JURADO,
Succession, supra at 487).
(2) Those made in consideration of a
Crime of which both the testator
and the beneficiary have been
found guilty; and
NOTE: Previous criminal conviction
is necessary (Id.).
(3) Those made in favor of a Public
officer or his spouse, descendants
and ascendants, by reason of his
public office (CIVIL CODE, Art.
739).
Characteristics:
1.) Possible only in testamentary
succession;
2.) Relative in character; and
3.) Partial, in the sense that if the heir
who is incapacitated or disqualified
is a compulsory heir, only the free
portion given to him is affected, but
not his legitime (JURADO,
Succession, supra at 484).
iii. Based on Acts of Unworthiness
(A4F3P)
(1) Parents who have Abandoned their
children or induced their daughters
to lead a corrupt or immoral life, or
attempted against their virtue;
(2) Any person who has been convicted
of an Attempt against the life of the
testator, his/her spouse,
descendants or ascendants;
(3) Any person who has Accused the
testator of a crime for which the law
prescribes imprisonment for 6 years
or more, if the accusation has been
found groundless;
(4) Any heir of full age who, having
knowledge of the violent death of the
testator, should Fail to report it to an
officer of the law within a month,
unless the authorities have already
taken action; this prohibition shall not
apply to cases wherein, according to
law, there is no obligation to make an
accusation;
Deaths occasioned by crime
(violent deaths) are prosecuted de
oficio or at the instance of the
government, and thus no one is
required to make any accusation (3
TOLENTINO, supra at 529).
In this jurisdiction, there is no
obligation imposed by the law to
make an accusation in such cases
(JURADO, Succession, supra at
492).
(5) Any person convicted of Adultery or
concubinage with the spouse of the
testator;
The spouse is not included. The
only time the guilty spouse shall not
inherit is when the offended spouse
act positively either by securing a
decree of legal separation or by
disinheriting him or her (Id.).
(6) Any person who by Fraud, violence,
intimidation, or undue influence
should cause the testator to make a
will or to change one already made;
(7) Any person who by the same
means Prevents another from
making a will, or from revoking one
already made, or who supplants,
conceals, or alters the latter's will;
and
(8) Any person who Falsifies or forges
a supposed will of the decedent
(CIVIL CODE, Art. 1032).
Characteristics:
(1) Based on offenses committed by
the disqualified person against
the decedent which renders him
unworthy to succeed;
(2) Applicable BOTH in testamentary
and legal succession; and
(3) Although relative in character, it is
total in the sense that it extends
not only to the free portion but
also to the legitime (JURADO,
Succession, supra at 491).
iv. By Operation of Law (LIP)
(1) Incapacity of the guilty spouse to
inherit from the innocent spouse if
there is a decree of Legal
separation (FAMILY CODE, Art.
63, par.4);
(2) Incapacity of Illegitimate children
and legitimate relatives of the
 decedent to inherit from each As to When it Takes Place
other (CIVIL CODE, Art. 992);
(3) Individuals, associations and Can take place in either Can take place only in
corporations not Permitted by law testamentary or testamentary
to inherit (CIVIL CODE, Art. 1027, intestate succession. succession.
par. 6).
As to Whether it Can Be Revoked
Pardon of Acts of Unworthiness
Reconciliation between the testator and the Cannot be revoked. Revoked when the
offender will render the disinheritance testator revokes the will
ineffective, and the heir will be restored to his or the institution.
inheritance. But if the testator has not made an (JURADO, Succession, supra at 493-494).
express disinheritance, then the laws on
disinheritance cannot operate; the rules on Effect of Pardon
unworthiness must apply, and the capacity of The heir is restored to full capacity to succeed
the heir can be restored only by the means of the decedent, as if the cause of unworthiness
pardon (3 TOLENTINO, supra at 538). had never existed (DE LEON, Succession,
supra at 594).
Only the decedent himself can erase the effects
of acts of unworthiness (JURADO, Succession, Time to Determine the Capacity
supra at 493). GENERAL RULE: At the moment of the death
of the decedent.
The act of the decedent in pardoning an act of
unworthiness must not be confused with EXCEPTIONS:
reconciliation. The first is a unilateral act, while
the second is a bilateral act requiring the TIME TO DETERMINE
DISQUALIFIED HEIR
concurrence of the offender. Under the Civil CAPACITY
Code, a subsequent reconciliation between the Under Art. 1032 of the Necessary to wait until
offender and the offended person deprives the Civil Code: final judgment is
latter of the right to disinherit, and renders 1. Par. (2) –Any person rendered.
ineffectual any disinheritance that may have who has been
been made. It cannot, however, erase the convicted of an
effects of an act of unworthiness (Id. at 494). attempt against the
life of the testator,
Executive clemency, or pardon by the President his or her spouse,
does not erase the unworthiness or incapacity of descendants,
the heir (3 TOLENTINO, supra at 537; 5 ascendants.
Valverde 450; 2 Camus 124). 2. Par. (3) –Any person
who has accused the
EXPRESS V. IMPLIED PARDON testator of a crime for
EXPRESS IMPLIED which the law
PARDON PARDON prescribes
imprisonment for 6
As to How it is Made years or more, if the
accusation has been
Made by the execution Effected when testator found groundless
of a document or any makes a will instituting 3. Par. (5) –Any person
writing in which the the unworthy heir with convicted of adultery
decedent condones the knowledge of the cause and concubinage
cause of incapacity. of incapacity. with the spouse of
the testator.

Under Art. 1032 of the Necessary to wait for 1

Civil Code: month.

Par. (4) Any heir of full

age who, having
knowledge of the violent
death of the testator,
should fail to report it to
 TIME TO DETERMINE 3. ACCEPTANCE AND REPUDIATION
DISQUALIFIED HEIR
CAPACITY OF INHERITANCE
ACCEPTANCE
an officer of the law The act by virtue of which an heir, legatee or
within a month. devisee manifests his desire in accordance with
the formalities prescribed by law to succeed to
If the institution of the Time of the compliance
the inheritance, legacy or devise (JURADO,
heirs, legacy or devise is with the condition shall
Succession, supra at 501).
conditional. be considered.
(JURADO, Succession, supra at 495-496). REPUDIATION
The act by virtue of which an heir, legatee or
Prescription: The action for a declaration of devisee manifests his desire in accordance with
incapacity and recovery of the inheritance, the formalities prescribed by law NOT to
devise or legacy shall be five (5) years from the succeed to the inheritance, legacy or devise
time the disqualified person took possession (Id.).
thereof. It may be brought by anyone who may
have an interest in the succession (CIVIL
CODE, Art. 1040). Characteristics: (VIR)
a. Voluntary and free (CIVIL CODE, Art. 1041);
Effect of Incapacity upon Compulsory Heirs b. Irrevocable, except if there is vitiation of
a. Incapacity based on Undue Influence consent or an unknown will appears (CIVIL
(CIVIL CODE, Art. 1027) and Morality or CODE, Art. 1056); and
Public Policy (CIVIL CODE, Art. 739) c. Retroactive (CIVIL CODE, Art. 1042).
Only the free portion given to the heir is
affected, but not his legitime (JURADO, Requisites:
Succession, supra at 496). a. Certainty of the Death of the decedent; and
b. Incapacity based on act of unworthiness b. Certainty of the Right to the inheritance
(CIVIL CODE, Art. 1032) (CIVIL CODE, Art. 1043).
Disqualifies a compulsory heir from
succeeding even to his legitime. ACCEPTANCE V. REPUDIATION
i. In Testamentary Succession: ACCEPTANCE REPUDIATION
Children or descendants of the
As to the Effect of Transmission of Rights
unworthy child or descendant shall
acquire his right to the legitime. Acceptance involves Repudiation renders
ii. In Intestate Succession: Children or the confirmation or such transmission
descendants of the unworthy child or transmission of ineffective.
descendant shall succeed to the entire successional rights.
share which is rendered vacant.
As to the Nature of the Act
NOTE: Both (i) and (ii) applies only if the
compulsory heir is a child or descendant of Acceptance can be Repudiation is
the decedent. presumed from equivalent to an act of
disposition, as an disposition and
Remedies Against Disqualified Heir incident of ownership. alienation.
In case the disqualified heir, devisee or legatee
has already taken possession of the property, As to Whether it May Be Presumed or Not
the remedy is an action for:
a. Declaration of incapacity; As it is more usual to Repudiation being, in
b. Recovery of the inheritance, devise or accept than to reject an effect, an act or
legacy (CIVIL CODE, Art. 1040); advantage or benefit, disposition, requires
c. The disqualified heir shall be considered as acceptance may be greater capacity and
possessor in bad faith; hence, he is obliged presumed. more formalities than
to return the hereditary property together acceptance.
with its accessions; and (JURADO, Succession, supra at 506-507).
d. Being in bad faith the disqualified heir shall
always be liable for damages (3 PARAS, Similarities between Acceptance and
supra at 574). Repudiation
a. Being free and voluntary acts, the presence
of any of the causes which vitiate consent
 (i.e. mistake, violence, intimidation, undue
Kinds of Acceptance Repudiation
influence, or fraud) will render them without
Heirs
effect;
b. Both are subsequent to the death of the May accept May repudiate
decedent but their effect retroacts to the Married without her without her
moment of said death; and Woman husband’s husband’s
c. There can be partial acceptance and consent consent
repudiation, since the law does not prohibit
this. If the devisee or legatee may accept or If literate, by If literate, by
repudiate partially, then an heir may also do themselves or themselves or
so provided only that he may not accept the through an through an
gratuitous part and repudiate the onerous agent. agent.
part (3 PARAS, supra at 579). Deaf-Mutes
If illiterate, by If illiterate, by
their guardian their guardian
WHO MAY ACCEPT OR REPUDIATE WITH judicial
INHERITANCE approval
Kinds of Acceptance Repudiation If the heir Creditors may
Heirs repudiates the not repudiate
inheritance,
Any person Any person creditor may
having the free having the free petition the
In General
disposal of his disposal of his court to
property property authorize them
Heir’s
to accept it in
Guardian or Guardian or Creditors
the name of the
Minors & legal legal
heir only to the
Incapacitated representative representative
extent
(e.g., deaf- WITH judicial
sufficient to
mute who authorization cover the
cannot read amount of their
and write,
credits.
under civil
interdiction)
Manner of Acceptance
1. Express Acceptance
– One made in a public or private document.
Person Beneficiaries
designated by themselves 2. Tacit Acceptance
the testator to once they are – One resulting from acts by which the intention
determine the determined to accept is necessarily implied or which one
If the
beneficiaries (CIVIL CODE, would have no right to do except in the capacity
Beneficiary is
and to Art. 1044) of an heir (CIVIL CODE, Art. 1049).
the Poor
distribute the
property. Tacit acceptance is presumed from certain acts
In default, the of the heir as: (SR2-DAP-C2E2F)
executor. 1. If he Sells, donates, or assigns his right;
2. If he Renounces it, even though gratuitously, for
If the Legal Legal the benefit of one or more his co-heirs;
Beneficiary is representative representative 3. If he Renounces it for a price in favor of all his
a WITH judicial co-heirs indiscriminately; and
Corporation, authorization
Association, NOTE: These are acts of disposition, acts which
Institution, or only the owner is empowered to perform.
Entity (JURADO, Succession, supra at 506).
Public Official With the With the 4. Other acts of tacit acceptance:
Establishmen government’s government’s a. Heir Demands partition of the inheritance;
t approval approval b. Heir Alienates some objects of the
inheritance;
 c. Acts of Preservation or administration if,
through such acts, the title or capacity of heir
has been assumed;
d. Filing of a Complaint for the partition of
inheritance;
e. Compromises regarding objects and rights
included in the inheritance;
f. Exercise of any action which pertained to
the decedent during his lifetime and which
survives;
g. Enjoyment of the inheritance itself; and
h. Under Art. 1057, Failure to signify
acceptance or repudiation within thirty (30)
days after an order of distribution by the
probate court (Id.).
Manner of Repudiation (PAB-JA)
a. Public instrument (acknowledged before a
notary public).
b. Authentic document (equivalent of an
indubitable writing; or a writing whose
authenticity is admitted or proved); or
c. By petition presented to the court having
jurisdiction over the testamentary or
intestate proceeding (Id.).
d. In case of inheritance left to minors or
incapacitated persons, parents or guardians
may repudiate the inheritance left to their
wards only by Judicial Authorization (CIVIL
CODE, Art. 1044).
Heir in Two Capacities
An heir who is such by will and by law, and who
repudiates the inheritance as a testamentary
heir, will be considered to have repudiated the
inheritance in both capacities. But when an heir
repudiates as a legal heir without knowledge of
his being a testamentary heir, he may later on
accept as a testamentary heir (CIVIL CODE, Art.
1055; JURADO, Succession, supra at 509).
Effect of Acceptance and Repudiation
GENERAL RULE: Irrevocable
EXCEPTIONS:
a. If made through any of the causes that
vitiates consent (e.g. mistake, violence,
intimidation, undue influence and fraud);
and
b. When an unknown will appears, provided
that such will substantially changes the
rights of a person who has repudiated or
accepted (CAGUIOA, Civil Law, supra at
449).
4. COLLATION
An act of returning or restoring to the common
mass of the estate, either actually or fictitiously,
any property which a person may have received
from the decedent during the latter’s lifetime, but
which is understood for legal purposes as an
advance from the inheritance (JURADO,
Succession, supra at 511).
Operations Related to Collation: (CIR2)
a. Collation – adding to the mass of the
hereditary estate the value of the donation
or gratuitous disposition;
b. Imputing or Charging– crediting the
donation as an advance on the legitime (if
the donee is a compulsory heir) or on the
free portion (if the donee is a stranger).
c. Reduction – determining to what extent the
donation will remain and to what extent it is
excessive or inofficious.
d. Restitution – return or payment of the
excess to the mass of hereditary estate.
Concepts of Collation (FIR)
a. Fictitious mathematical process of adding
the value of the thing donated to the net
value of the hereditary estate;
PURPOSE: To compute the legitime of
compulsory heirs.
b. Act of charging or Imputing such value
against the legitime of the compulsory heir
to whom the thing was donated; and
PURPOSE: To take the donations in the
account of partition in order to equalize the
shares of the compulsory heirs as much as
possible.
c. Actual act of Restoring to the hereditary
estate that part of the donation which is
inofficious in order not to impair the legitime
of compulsory heirs (JURADO, Succession,
supra at 315).
Obligation to Collate
Every compulsory heir, who succeeds with other
compulsory heirs must bring into the mass of the
estate any property or right which he may
receive from the decedent, during the lifetime of
the latter, by way of donation, or any other
gratuitous title, in order that it may be computed
in the determination of the legitime of each heir,
and in the account of partition (CIVIL CODE, Art.
1061).
NOTE: Express provision by the testator
exempting an heir from collation does not mean
no collation at all. The heir is merely considered
as a stranger and what he has received from the
testator must be charged from the free portion (3
TOLENTINO, supra at 572-573).
Persons Obliged to Collate:
a. GENERAL RULE: Compulsory heirs
EXCEPTIONS:
i. When the testator should have so
expressly provided; and
ii. When the compulsory heir should have
repudiated his inheritance (CIVIL
CODE, Art. 1062).
In these cases, the donation shall be
charged to the free portion and not to the
legitime (3 PARAS, supra at 612).
REASON: The legitime of compulsory heirs
must never be impaired (JURADO,
Succession, supra at 516).
When the law says that “collation shall not
take place,” what it actually meant is that the
value of the thing donated shall not be
imputed against the legitime of the
beneficiary; instead, it shall be imputed
against the disposable free portion (Id. at
514).
b. Grandchildren who survive with their uncles,
aunts, or first cousins, and inherit by right of
representation.
What to Collate:
a. Any property or right received by way of
donation or any other gratuitous title during
the testator’s lifetime (CIVIL CODE, Art.
1061).
b. In case of grandchildren:
i. All that they may have received from the
decedent during his lifetime.
ii. All that their parents, if alive, would have
brought to collation (CIVIL CODE, Art.
1064).
c. Any sums paid by a parent in satisfaction of
the debts of his children, election expenses,
fines, and similar expenses (CIVIL CODE,
Art. 1069).
NOTE: Only the value of the thing donated shall
be brought to collation. This value must be the
value of the thing at the time of the donation,
even though its just value may not then have
been assessed (JURADO, Succession, supra at
523).
The subsequent increase or deterioration and
even the total loss or destruction of the thing, be
it accidental or culpable, shall be for the benefit
or account and risk of the donee (CIVIL CODE,
Art. 1071).
Properties NOT Subject to Collation:
a. Parents are not obliged to bring to collation
in the inheritance of their ascendants any
property which may have been donated by
the latter to their children (CIVIL CODE, Art.
1065);
b. Donations to the spouse of the child (CIVIL
CODE, Art. 1066);
c. Expenses for support, education
(elementary and secondary only), medical
attendance, even in extraordinary illness,
apprenticeship, ordinary equipment, or
customary gifts (CIVIL CODE, Art. 1067);
d. Expenses incurred by parents in giving their
children professional, vocational or other
career unless the parents so provide, or
unless they impair the legitime (CIVIL
CODE, Art. 1068); and
e. Wedding gifts by parents and ascendants
consisting of jewelry, clothing, and outfit
except when they exceed 1/10 of the sum
disposable by will (CIVIL CODE, Art. 1070).
Illustration:
(a) During A’s lifetime, A gave B a house. That house
was later on donated by B to L, a friend. If B
predeceases A, then E will represent B, and together
with C and D will inherit from A. E will be obliged to
collate the value of the house, even if E himself has
not inherited said property. This is so because, had
B been alive, he would have been obliged to bring to
collation the value of said house. Since E merely
takes his (B’s) place, it naturally follows that collation
by him (E) is in order.
In the example given in (a), if A had given E a house
during A’s lifetime, the value of said house should
also be collated (considered an advance of his
inheritance) unless of course the testator has
provided otherwise.
However, even if there is such a contrary provision,
the legitime of the co-heirs must not be prejudiced.
Hence, even if the testator has stated that the house
should not be considered as an advance of the
legitime of E (meaning that aside from the legitime,
E would get also the house), still this will not be the
case if by such means, the legitime of the co-heirs is
impaired.
5. EQUALIZATION OF SHARES
GENERAL RULE: Co-heirs shall receive an
equivalent, as much as possible, in property of
the same nature, class and quality (CIVIL
CODE, Art. 1073).
EXCEPTIONS:
If it would be impracticable to give the co-heirs
an equivalent in property and:
1. If the property donated was immovable, give
the co-heirs its equivalent in cash or
securities at the rate of quotation; and if
impossible and impracticable, sell at public
auction as much of the other property as
may be necessary (CIVIL CODE, Art. 1074,
Par. 1); or
2. If the property donated was movable, co-
heirs shall only have a right to select an
equivalent of other personal property of the
inheritance at its just price (CIVIL CODE,
Art. 1074, Par. 2).
6. PARTITION AND DISTRIBUTION OF
THE ESTATE PARTITION
It is the separation, division and assignment of a
thing held in common among those to whom it
may belong. It includes every act which is
intended to put an end to indivision among co–
heirs and legatees or devisees, although it
should purport to be a sale, an exchange,
compromise, or any other transaction. It is not
subject to any form (CIVIL CODE, Art. 1079 and
1082).
Nature of Property Before Partition
There is co-ownership between or among heirs
(CIVIL CODE, Art. 1079).
Kinds of Partition Under the Rules of Court:
a. Ordinary or Judicial Action for Partition
(RULES OF COURT, Rule 69); and
b. Extrajudicial Settlement (RULES OF
COURT, Rule 74, Sec. 1)
Requisites: (IDAP2)
i. The decedent died Intestate;
ii. The estate has no outstanding Debts at the
time of the settlement;
iii. Decedent's heirs are all of Age or the
minors are represented by their judicial or
legal representatives;
iv. The settlement was made by means of a
Public instrument or affidavit filed with the
Register of Deeds; and
NOTE: There is no law that requires
partition among heirs to be in writing to be
valid. There is nothing in Section 1 of Rule
74 of the Rules of Court from which it can
be inferred that a writing or other formality
is an essential requisite to the validity of
the partition. Accordingly, an oral partition
is valid (Vda. De Reyes vs. CA (GR No.
92436, July 26, 1991).
REASON: The requirement that a partition
be put in a public document and registered
has for its purpose the protection of
creditors and at the same time the
protection of the heirs themselves against
tardy claims. The object of registration is to
serve as constructive notice to others. It
follows then that the intrinsic validity of
partition not executed with the prescribed
formalities does not come into play when
there are no creditors or the rights of
creditors are not affected (Hernandez vs.
Andal, GR No. L-273, March 29,1947)
v. The fact of such judicial settlement must
be Published in a newspaper of general
circulation in the province once a week for
three (3) consecutive weeks (FESTIN,
Special Proceedings, (2020), p. 31)
[hereinafter, FESTIN, Special
Proceedings]); and
vi. Filing of a bond equivalent to the value of
personal property posted with Register of
Deeds (DE LEON & WILWAYCO, Special
Proceedings: Essential for Bench and Bar,
(2020), p. 32 [hereinafter, DE LEON &
WILWAYCO, Special Proceedings]).
The fact that the document was not
notarized is no hindrance to its effectivity.
The partition of inherited property need not
be embodied in a public document
(Alejandrino v. CA, G.R. No. 114151,
September 17, 1998). Partition among co-
owners may thus be evidenced even by the
overt act of a co-owner of renouncing his
right over the property regardless of the form
it takes." The Court based this assertion on
Article 1082 of the Civil Code (Heirs of
Morales v. Agustin, G.R. No. 224849, June
6, 2018).
Extrajudicial partition cannot constitute a
partition of the property during the lifetime of
its owner. Partition of future inheritance is
prohibited by Art. 1347 of the New Civil Code
(JURADO, Succession, supra at 528).
MODES OF SETTLEMENT OF ESTATE
1. Extrajudicial Settlement
Where the decedent left no will and no debts
a. Deed of Extrajudicial Settlement;
b. Partition; or
c. Affidavit of Self-adjudication (ROC, RULE
74, Sec. 1)
2. Judicial Settlement
a. Partition – Ordinary action of partition (ROC,
RULE 69);
b. Summary of Settlement of Estate of Small
Value (ROC, RULE 74, Sec. 2);
c. Probate of Will (ROC, RULES 75-59); or
d. Petition for Letters of Administration (ROC,
RULE 79)
WHO MAY EFFECT PARTITION:
1. Decedent himself during his lifetime by an act
inter vivos or by will;
2. Third person designated by the decedent;
3. Heirs themselves; or
4. Competent court (JURADO, Succession, supra
at 528).
PARTITION BY DECEDENT
Under Art. 1080. there are two ways by which a
person may affect the partition of his own property
or estate – by an act inter vivos or by will. In both
cases, the legitime of compulsory heirs must not be
prejudiced (Id. at 529).
Two Ways of Partition by the Decedent:
1. By an Act inter vivos (Partition Inter Vivos)
(CIVIL CODE, Art. 1080)
It may be oral or written and need not be in the
form of a will, provided that the partition does not
prejudice the legitime of compulsory heirs. This
constitutes an exception to the rule declared in
Art. 1347, par. 2 of the Code that no person can
enter into a contract with respect to future
inheritance (Id. at 529-530).
In partition inter vivos, the rules regarding
ordinary conveyance of personal and real
properties must be followed such as when
conveyance through a public instrument is
required (Id. at 530).
NOTE: The testator may still revoke the partition
done by his own act inter vivos because during
such time, that is, before his death, he is still the
owner of the property (3 TOLENTINO, supra at
598-599).
Rationale: The rights to the succession are
transmitted from the moment of death of the
decedent (CIVIL CODE, Art. 777).
2. By Will (Partition Mortis Causa) (CIVIL
CODE, Art. 1080) It must be effected by a valid
will duly executed in accordance with the
formalities prescribed by law (JURADO,
Succession, supra at 529).
A partition agreement which was executed
pursuant to a will that was not probated cannot
be given effect. Before any will can have any
force or validity it must be probated - this cannot
be dispensed with and is a matter of public policy
(Rodriguez v. Rodriguez, G.R. No. 175720,
September 11, 2007).
PARTITION BY THIRD PERSON
A person may, by an act inter vivos or mortis causa,
intrust the mere power to make the partition after his
death to any person who is not one of the co-heirs
(CIVIL CODE, Art. 1081, par. 1).
What is entrusted is the mere power of partition, not
the power to distribute the hereditary estate. Hence,
the act of the person delegated with such power is
that of a mere agent or mandatory (JURADO,
Succession, supra at 530).
WHO CAN DEMAND PARTITION: (CLAV)
1. Compulsory heir;
2. Legatee or devisee;
3. Any person who has acquired an interest in the
estate; and
4. Voluntary heir (Id. at 531).
WHEN PARTITION CANNOT BE
DEMANDED: (PAPUF)
1. When expressly Prohibited by the testator
himself for a period not exceeding 20 years;
2. When the co–heirs Agreed that the estate shall
not be divided for a period not exceeding 10
years, renewable for another 10 years;
3. When Prohibited by law (i.e. party wall);
4. When to partition the estate would render it
Unserviceable for the use for which it is
intended; and
5. When the property owned in common by co-
heirs is a Family home and the testator has not
ordered its dissolution (Id.).
PROVISIONAL PARTITION
Voluntary heir upon whom some condition has been
imposed cannot demand partition until the condition
has been fulfilled; but the other co-heirs may
demand it by giving sufficient security for the rights
which the former may have in case the condition
should be complied with, and until it is known that
the condition has not been fulfilled or can never be
complied with, the partition shall be understood to be
provisional (CIVIL CODE, Art. 1084).
The partition will become permanent after:
1. The condition was fulfilled; and
2. It is known that the condition has not been
fulfilled or can never be complied with (CIVIL
CODE, Art. 1084).
CONSTRUCTIVE PARTITION
Where thing owned in common is indivisible or a
division thereof would impair its value or render it
unserviceable for the use for which it is intended, it
may be adjudicated to one of the heirs who shall pay
the others the excess in cash. Nevertheless, if any
of the heirs should demand that the thing be sold at
public auction and strangers be allowed to bid, this
must be done (CIVIL CODE, Art. 1086).
RULE WHEN A CO-OWNER SELLS HIS
SHARE BEFORE PARTITION
Before the property is partitioned, the heirs are co-
owners of the property and they cannot alienate the
shares that do not belong to them (CIVIL CODE, Art.
493).
Should any of the heirs sell his hereditary rights to a
stranger before the partition, any or all of the co-heirs
may be subrogated to the rights of the purchaser by
reimbursing him for the price of the sale, provided
they do so within the period of one month from the
time they were notified in writing of the sale by the
vendor (CIVIL CODE, Art. 1088).
Any sale by one heir of the rest of the property will
not affect the rights of the other heirs who did not
consent to the sale. Such sale is void with respect
to the shares of the other heirs (Heirs of Gregorio
Lopez vs. DBP, G.R. No. 193551, November 19,
2014).
REQUISITES OF LEGAL REDEMPTION:
(S2-BO-1R)
1. There must be Several co-heirs;
2. One of them Sells his right to a stranger;
3. The sale is made Before the partition;
4. The right of redemption must be exercised by
only One or more of the co-heirs;
5. It must be 1 month from the time they were
notified in writing by the co-heir vendor; and
6. The vendee is Reimbursed for the price of the
sale (3 PARAS, supra at 649).
NOTE: The redemption can be exercised only by a
co-heir (Id.).
EFFECTS OF PARTITION:
1. A partition legally made confers upon each heir
the exclusive ownership of the property
adjudicated (CIVIL CODE, Art. 1091); and
2. Obligation of Warranty – After the partition, the
co-heirs shall be reciprocally bound to warrant
the title to (warranty against eviction) and the
quality of (warranty against hidden defects) each
property adjudicated (CIVIL CODE, Art. 1092).
RULE ON OBLIGATION OF WARRANTY
The obligation is proportionate to the respective
hereditary shares of the co-heir but if any of them
becomes insolvent, the others shall be liable also for
his part in the same proportion, deducting the part
corresponding to the one to be indemnified, without
prejudice to their right of reimbursement should the
financial condition of the insolvent heir improve
(CIVIL CODE, Art. 1093).
RULE WHEN WARRANTY OF CREDIT
ASSIGNED
When a credit is assigned to a co-heir as good or
collectible, the other co-heir is liable in case of
insolvency of the debtor of the estate if such
insolvency existed at the time the partition was made
(CIVIL CODE, Art. 1095, par. 1).
NOTE: There is no warranty as to bad debts
assigned to a co-heir if so known and accepted by
the latter. If the bad debts which have not been
allotted to a co-heir are paid, all shall share
proportionately the amount collected (CIVIL CODE,
Art. 1095, par. 3).
Prescriptive Period to Enforce Warranty Among
Co-heir: 10 years from the date the right of action
accrues (CIVIL CODE, Art. 1094)
Prescriptive Period of Warranty for Solvency of
Debtor:
5 years from partition (CIVIL CODE, Art. 1095, par.
2)
The Obligation of Warranty shall cease in the
following Cases: (PSE)
1. When the testator himself has made the
Partition unless his intention was otherwise, but
the legitime shall always remain unimpaired;
2. When it has been expressly Stipulated in the
agreement of partition, unless there has been
bad faith; and
3. When the Eviction is due to a cause subsequent
to the partition, or has been caused by the fault
of the distributee of the property (CIVIL CODE,
Art. 1096).
RESCISSION AND ANNULMENT OF
PARTITION
Partition, once made, may be rescinded or annulled
for the same causes as in contracts (CIVIL CODE,
Art. 1097).
EFFECTS OF INCLUSION OF INTRUDER RESCISSION ANNULMENT
IN PARTITION any other manner
1. Between a true heir and several mistaken collect the claims due
heirs (CIVIL CODE, Art. 1105): them;
a. The partition is void; and 4. Those which refer
b. The declaration of nullity shall result in the to things under
delivery of everything that had been litigation if they have
adjudicated to the true heir. been entered into by
the defendant without
2. Between several true heirs and a the knowledge and
mistaken heir (CIVIL CODE, Art. 1105): The approval of the
transmission to a mistaken heir is void. litigants or of
competent judicial
3. Through error or mistake, share of true authority;
heir is allotted to mistaken heir (CIVIL 5. All other contracts
CODE, Arts. 1104 and 1105): specially declared by
a. The partition shall not be rescinded unless law to be subject to
there is bad faith or fraud on the part of the rescission; and
other persons interested, but the latter shall 6. Payments made in a
be proportionately obliged to pay the true state of insolvency for
heir of his share; and obligations to whose
b. The partition with respect to the mistaken fulfillment the debtor
heir is void (JURADO, Succession, supra at could not be
537). compelled at the
time they
RESCISSION V. ANNULMENT OF were effected (CIVIL
CODE, Art. 1380-
PARTITION 1382).
RESCISSION ANNULMENT
As to Definition PARTITION WITH PRETERITION
GENERAL RULE: A partition made with preterition
Rescissible contracts are Annulment is a remedy
cannot be rescinded (CIVIL CODE, Art. 1104).
valid contracts without granted by law because
any defect whatsoever of vices or defects in
EXCEPTION: When it can be proved that there was
but the law grants the consent or because of
bad faith or fraud on the part of the other persons
remedy of rescission. the incapacity of one of
interested (CIVIL CODE, Art. 1104).
the contracting parties.
As to Grounds REMEDY OF PRETERITED HEIR
1. Those which 1. Party incapable of Demand that the persons interested be
are entered into by giving consent; and proportionally liable for his share in the inheritance
guardians whenever 2. Vitiated consent (CIVIL CODE, Art. 1104).
the wards a. Mistake;
whom they b. Violence; RESCISSION OF PARTITION DUE TO
represent suffer lesion c. Intimidation; LESION
by more than 1/4 of d. Undue Influence; If in the partition, anyone of the co-heirs should
the value of the things and receive a share whose value is less, by at least 1/4
which are the object e. Fraud (CIVIL than the share to which he is entitled, considering
thereof; CODE, Art. 1390). the value of the things at the time they were
2. Those agreed upon in adjudicated, the partition, whether judicial or
representation of extrajudicial, may be rescinded on account of the
absentees, if the lesion (CIVIL CODE, Art. 1098).
latter suffer the lesion
stated in the If the lesion is less than 1/4 rescission will not lie; the
preceding number; proper action is one for damages (3 PARAS, supra
3. Those undertaken in at 664).
fraud of
creditors when the GENERAL RULE: If the partition was effected by the
latter cannot in decedent himself either by an act inter vivos or by
will, it cannot be impugned on the ground of lesion
(JURADO, Succession, supra at 536).

EXCEPTIONS:
1. When the legitime of the compulsory heir is
prejudiced; and
2. When it appears or may reasonably be
presumed that the intention of the testator was
otherwise (3 PARAS, supra at 664).

NOTE: In both cases, the lesion may be less than

1/4 (Id.).

Options for the Sued Heir:

1. Indemnify the plaintiff in cash or by the delivery
of the thing in same kind and quality as that
awarded to the plaintiff; or
2. Consent to a new partition. If a new partition is
made, it shall affect neither those who have not
been prejudiced nor those who have not
received more than their just share (CIVIL
CODE, Art. 1101).

Prescriptive Period of Partition Due to Lesion:

4 years from the date of judicial partition (CIVIL
CODE, Art. 1100).

DISTRIBUTION OF ESTATE
GENERAL RULE: No distribution shall be allowed
until the payment of the debts, funeral charges, and
expenses of administration, the allowance to the
widow, and inheritance tax, if any, chargeable to the
estate in accordance with law.

EXCEPTION: The distributees, or any of them, give

a bond, in a sum to be fixed by the court, conditioned
for the payment of said obligations within such time
as the court directs (RULES OF COURT, Rule 90,
Sec. 1).

Reading Article 777 of the Civil Code together with

the pertinent provisions of PD 1529 (Property
Registration Decree) and the Rules of Court, while
an heir may dispose and transfer his/her hereditary
share to another person, before the transferee may
compel the issuance of a new certificate of title
covering specific property in his/her name, a final
order of distribution of the estate or the order in
anticipation of the final distribution issued by the
testate or intestate court must first be had (Salitico
vs. Heirs of Resurreccion Martinez Felix, G.R. No.
240199, April 10, 2019).

OBLIGATIONS
GENERAL PROVISIONS
(ARTS. 1156-1162)
OBLIGATION
A juridical necessity to give, to do, or not to do (CIVIL
CODE, Art. 1156).
An obligation is a juridical relation whereby a person
(called the creditor) may demand from another (called
the debtor) the observance of a determinative
conduct (the giving, doing or not doing), and in case
of breach, may demand satisfaction from the assets
of the latter (Makati Stock Exchange, Inc. v. Campos,
G.R. No. 138814, April 16, 2009).
JURIDICAL NECESSITY
Obligation is a juridical necessity because in case of
non-compliance, the courts of justice may be called
upon to enforce its fulfillment or, in default thereof, the
economic value that it represents (DE LEON,
Comments and Cases on Obligations and Contracts
(2014), pp. 1-2 [hereinafter DE LEON, Obligations
and Contracts]).
Elements of an Obligation: (JAPO)
1. The Vinculum juris or Juridical tie
2. The Active Subject or obligee/creditor
3. The Passive Subject or obligor/debtor
4. The Object or Prestation
A. JURIDICAL TIE OR RELATION
The efficient cause established by the various
sources of obligations (law, contracts, quasi-
contracts, delicts and quasi-delicts).
The vinculum juris or juridical tie is that which
essentially binds the parties to the obligation. This
linkage between the parties is a binding relation that
is the result of their bilateral actions, which gave rise
to the existence of the contract (The Wellex Group,
Inc. v. U-Land Airlines, Co., Ltd., G.R. No. 167519,
January 14, 2015).
B. ACTIVE SUBJECT
The obligee or creditor, who can demand the
fulfillment of the obligation.
He is the possessor of a right; he in whose favor the
obligation is constituted (PARAS, Civil Code of The
Philippines Annotated, Vol. IV (2016). pp. 78
[hereinafter, 4 PARAS).
C. PASSIVE SUBJECT
The obligor or debtor, against whom the obligation is
juridically demandable.
D. OBJECT / PRESTATION
A prestation is the object of an obligation, and it is the
conduct required by the parties to do or not to do, or
to give (The Wellex Group, Inc. v. U-Land Airlines,
supra, citing Ang Yu Asuncion v. CA, G.R. No.
109125, December 2, 1994).
Not the thing or object, but the particular conduct of
the debtor which may consist in giving, doing, or not
giving, or not doing something (4 TOLENTINO,
Commentaries and Jurisprudence on the Civil Code
of the Philippines, (2002), p. 57 [hereinafter 4
TOLENTINO]).
KINDS OF PRESTATION:
1. To give
– a prestation which consists in the delivery of a
movable or an immovable thing in order to create
a real right, or for the use of the recipient, or for
its simple possession, or in order to return it to its
owner (e.g., sale, deposit, donation) (Iloilo Jar

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA TAMPUS, Vice Chairperson
for Secretariat | ARVY KEITH CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice Chairperson for
Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. JUN MARR M. DENILA and Dean ULPIANO P. SARMIENTO III

 Corporation v. Comglasco Corporation/ Aguila
Glass, G.R. No. 219509, January 18, 2017);
2. To do
– includes all kinds of work or service (Iloilo Jar
Corporation v. Comglasco Corporation/ Aguila
Glass, G.R. No. 219509, January 18, 2017); and
3. Not to do
– consists in abstaining from doing some act.
This obligation includes the obligation “not to
give” (4 TOLENTINO, supra at 57- 58).
FORMS OF OBLIGATION
It is settled that once perfected, a contract
[obligations arising from contracts] is generally
binding in whatever form, whether written or oral, it
may have been entered into, provided the essential
requisites for its validity are present (Kabisig Real
Wealth Dev., Inc. v. Young Builders Corporation,
G.R. No. 212375, January 25, 2017).
Obligations arising from other sources do not have
any form at all (DE LEON, Obligations and Contracts,
p. 3).
KINDS OF OBLIGATIONS:
Obligations may be classified as:
1. Viewpoint of Sanction
a. Civil Obligations – an obligation, which if not
fulfilled when it becomes due and
demandable, may be enforced in court
through an action (4 TOLENTINO, supra at
59);
b. Natural Obligations – not based on positive
law but on equity and natural law; do not
grant a right of action to enforce their
performance, but after voluntary fulfillment by
the obligor, they authorize retention of what
has been delivered or rendered by reason
thereof (CIVIL CODE, Art. 1423); and
c. Moral Obligations – those that are not
demandable in law, but only in conscience,
over which human judges have no
jurisdiction (Fisher v. Robb, G.R. No. 46274,
November 2, 1939).
2. Viewpoint of Performance
a. Positive Obligation – the obligation to give
or to do (PARAS, Obligations and Contracts
supra at 80); and
b. Negative Obligation – when the obligor
must refrain from giving or doing something
(JURADO, Comments and Jurisprudence on
Obligations and Contracts, (2010), p. 5)
[hereinafter JURADO, Obligations and
Contracts].
3. Viewpoint of Subject Matter
a. Personal Obligation (obligation to do or
not to do) – that in which the subject matter
is an act to be done or not to be done; and
b. Real Obligation (obligation to give) – that
in which the subject matter is a thing which
the obligor must deliver to the obligee (DE
LEON, supra at 9).
i. Determinate or Specific – one that is
particularly designated or physically
segregated from all others of the same
class (CIVIL CODE, Art. 1460);
ii. Indeterminate or Generic – indicated
merely by its class or genus without
being designated or distinguished from
others of the same kind; its loss does not
extinguish the obligation for genus never
perishes (genus nunquam perit); and
iii. Limited generic thing – when the generic
objects are confined to a particular class,
e.g., an obligation to deliver one of my
horses (JURADO, Obligations and
Contracts, supra at 91).
4. Viewpoint of Person Obliged
a. Unilateral – where only one party is bound;
and
b. Bilateral or Mutual – where both parties are
mutually or reciprocally bound (JURADO,
Obligations and Contracts, supra at 5)
i. Reciprocal (CIVIL CODE, Arts. 1169-
1191).
RECIPROCAL OBLIGATIONS V.
BILATERAL OBLIGATIONS
Parties may be mutually obliged to each other, but the
prestations of these obligations are not necessarily
reciprocal. The reciprocal prestations must
necessarily emanate from the same cause that gave
rise to the existence of the contract (4 TOLENTINO,
supra at p. 174).
SOURCES OF OBLIGATIONS:
1. Law;
2. Contracts;
3. Quasi-contracts;
4. Acts or omissions punished by law (Delicts); and
5. Quasi-delicts (CIVIL CODE, Art. 1157).
NOTE: The list of sources is exclusive (Sagrado
Orden v. Nacoco, G.R. No. L-3756, June 30, 1952).
A. OBLIGATION ARISING FROM LAW
(EX-LEGE)
Obligations derived from law are not presumed. Only
those expressly determined in the CIVIL CODE or in
special laws are demandable, and shall be regulated
by the precepts of the law which establishes them;
and as to what has not been foreseen, by the
provisions of Book IV of the CIVIL CODE (CIVIL one shall be unjustly enriched or benefited at the
CODE, Art. 1158). expense of another (CIVIL CODE, Art. 2142).

Every person who, contrary to law, willfully or Quasi-contracts are based on the principles that:
negligently causes damage to another, shall 1. No one must unjustly enrich himself at another’s
indemnify the latter for the same (CIVIL CODE, Art. expense;
20). 2. If one benefits, he must reimburse; and
3. Justice and equity (PARAS, Civil Code of the
B. OBLIGATIONS ARISING FROM Philippines Annotated, (2016), Vol. 5, p. 1157
CONTRACTS (EX-CONTRACTU) [hereinafter 5 PARAS]).
In other words, the law considers the parties as
Obligations arising from contracts have the force of
having entered into a contract, irrespective of their
law between the contracting parties and should be
intention, to prevent injustice (DE LEON, Obligations
complied with in good faith (CIVIL CODE, Art. 1159).
and Contracts, supra at 21).
Hence, a contracting party’s failure, without legal
Two Main Kinds Quasi-Contract:
reason to comply with contract stipulations breaches
1. Negotiorum Gestio
their contract and can be the basis for the award of
2. Solutio Indebiti.
damages to the other contracting party (Angel V.
Talampas, Jr. v. Moldex Realty, Inc., G.R. No.
NEGOTIORUM GESTIO (OFFICIOUS
170134, June 17, 2015).
MANAGEMENT)
Whoever voluntarily takes charge of the agency or
Meaning of Contract
management of the business or property of another,
A contract is a meeting of the minds between two
without any power from the latter, is obliged to
persons whereby one binds himself, with respect to
continue the same until the termination of the affair
the other, to give something or to render some
and its incidents, or to require the person concerned
service (CIVIL CODE, Art. 1305).
to substitute him, if the owner is in a position to do so
(CIVIL CODE, Art. 2144).
Binding Force of a Contract
Contracts are perfected by mere consent, and from
Requisites of Negotiorum Gestio
that moment the parties are bound to
The essential requisites of negotiorum gestio are as
1. the fulfillment of what has been expressly
follows (No-CAN-Vo):
stipulated
1. No meeting of the minds;
2. to all of the consequences which, according to
2. Taking Charge of another’s business or property;
the nature of the obligations, may be in keeping
3. Property or business must have been
with good faith, usage, and law (CIVIL CODE,
Abandoned or neglected;
Art. 1315).
4. The officious manager must Not have been
expressly or implicitly authorized; and
NOTE: Where the law requires that a contract be
5. The officious manager (gestor) must have
made in some form, it shall only bind the parties upon
Voluntarily taken charge – there must be no
compliance with the prescribed formalities (see CIVIL
vitiated consent, such as error in thinking that he
CODE, Art. 1356).
owned the property or the business (PARAS,
Civil Code of the Philippines Annotated, 2016,
Breach of Contract (Culpa Contractual)
Vol. 5, p. 1159 [hereinafter 4 PARAS]).
In culpa contractual, the mere proof of the existence
of the contract and the failure of its compliance justify,
When Negotiorum Gestio Not Present
prima facie, a corresponding right of relief. The law,
Negotiorum Gestio does not arise in either of these
recognizing the obligatory force of contracts, will not
instances:
permit a party to be set free from liability for any kind
1. When the property or business is not neglected
of misperformance of the contractual undertaking or
or abandoned (in such a case provisions of Arts.
a contravention of the tenor thereof (Gilat Satellite
1317, 1403[1], and 1404 regarding unauthorized
Networks, Ltd. v. United Coconut Planters Bank
contracts shall govern); and
General Insurance Co., Inc., G.R. No. 189563, April
2. If in fact the manager has been tacitly (implied
7, 2014).
from actions or statements) authorized by the
owner (in such a case rules on agency in Title X,
C. QUASI-CONTRACTS (QUASI EX- Book IV, shall apply) (CIVIL CODE, Art. 2144).
CONTRACTUAL)
Juridical relations arising from lawful, voluntary, and SOLUTIO INDEBITI (PAYMENT NOT DUE)
unilateral acts by virtue of which the parties become If something is received when there is no right to
bound to each other, based on the principle that no demand it, and it was unduly delivered through
mistake, the obligation to return it arises (CIVIL
CODE, Art. 2154).
Elements of Solutio Indebiti
The principle of solutio indebiti applies where:
1. A payment is made when there exists no binding
relation between the payor, who has no duty to
pay, and the person who received the payment;
and
2. The payment is made through mistake, and not
through liberality or some other cause (Spouses
Abella v. Spouses Abella, G.R. No. 195166, July
8, 2015).
ACCION IN REM VERSO V. SOLUTIO
INDEBITI
ACCION IN REM SOLUTIO INDEBITI
VERSO (ART. 2154)
It is not necessary that Payment made by
the payment was made mistake is an essential
by mistake; payment element to maintain the
could have been made action for recovery.
knowingly and
voluntarily.
Nevertheless, there
would be recovery of
what has been paid.
(1 TOLENTINO, supra at 83-84).
Obligation to Pay Interest on Payment Unduly
Received Until Returned
Whoever in bad faith accepts undue payment, shall
pay legal interest if a sum of money is involved, or
shall be liable for fruits received or which should have
been received if the thing produces fruits. He shall
furthermore be answerable for any loss or impairment
of the thing from any cause, and for damages to the
person who delivered the thing until it is recovered
(CIVIL CODE, Art. 2159).
Other Quasi-Contracts Recognized Under the
Civil Code
1. Right to claim support given by a stranger, from
the person obliged to give support (CIVIL CODE,
Art. 2164).
2. Right to reimburse the funeral expenses, borne
by a third person, from the relatives obliged to
give support to the deceased (CIVIL CODE, Art.
2165).
3. Right of reimbursement of stranger who furnishes
support to an orphan,an insane person, or other
indigent person, from the person obliged to give
support to the latter (CIVIL CODE, Art. 2166).
4. Obligation of the person injured or seriously ill to
pay for the services of the physician or other
person, who treated or helped him while he is not
in a condition to give consent (CIVIL CODE, Art.
2167).
5. Obligation of the owner of the property to pay a
just compensation to the person who saved it
from destruction (CIVIL CODE, Art. 2168).
6. Obligation of the person who failed to comply with
health or safety regulations to pay the expenses
of the government in undertaking to do the
necessary work (CIVIL CODE, Art. 2169).
7. Co-ownership of movables commingled or
confused by accident or other fortuitous event
(CIVIL CODE, Art. 2170).
8. Rights and obligations of the finder of lost
personal property (CIVIL CODE, Art. 2171).
9. Right of every possessor in good faith to
reimbursement for necessary and useful
expenses (CIVIL CODE, Art. 2172).
10. Right to beneficial reimbursement by a third
person who pays the debt of another without his
knowledge (CIVIL CODE, Art. 2173).
11. Obligation of a person benefited by measure for
protection against lawlessness, fire, flood, storm
or other calamity to pay his share of expenses
(CIVIL CODE, Art. 2174).
12. Right of reimbursement by a person constrained
to pay the taxes of another from the latter (CIVIL
CODE, Art. 2175).
NOTE: Enumeration of Quasi-Contracts in the CIVIL
CODE is NOT exhaustive nor exclusive (CIVIL
CODE, Art. 2143).
D. DELICT (EX-DELICTO OR CULPA
CRIMINAL)
Civil obligations arising from criminal offense shall be
governed by the penal laws (CIVIL CODE, Art. 1161).
Every person criminally liable for a felony is also
civilly liable (REVISED PENAL CODE, Art. 100)
Every crime gives rise to:
1. A criminal action for the punishment of the guilty
party; and
2. A civil action for the restitution of the thing, repair
of the damage, and indemnification for the losses
(Romero v. People of the Philippines, G.R. No.
167546, July 17, 2009).
Reason of Civil Liability Ex Delicto
A crime has dual character:
1. As an offense against the state because of the
disturbance of the social order; and
2. As an offense against the private person
injured by the crime (Occena v. Icamina, G.R. No.
82146, January 22, 1990).
Scope of Civil liability Ex Delicto
1. Restitution of Property taken;
2. Reparation of damage caused; or
3. Indemnification for consequential damages
(REVISED PENAL CODE, Art. 104).
No Civil Liability for “Victimless Crimes”
No civil liability arises on the part of the offender in
some crimes such as Treason, Gambling, or Illegal
Possession of Firearms, because there are no
damages to be compensated or there is no private
person injured by the crime (JURADO, Obligations
and Contracts, supra at 11).
Effect of Exempting Circumstances to Civil
Liability Ex Delicto
Under Article 12 of the Revised Penal Code, persons
exempted from criminal liability are not necessarily
exempted from civil liability except under Article 12,
par. 4. (See REVISED PENAL CODE, Art. 101).
Effect of Extinguishment of Criminal Liability on
Civil Liability
If criminal liability was extinguished on the ground
that the accused was not the author of the acts
complained of as a felony or offense, no civil liability
arises in relation thereto (see CIVIL CODE, Art. 29;
Dayap v. Sendiong, G.R. No. 177960, January 29,
2009).
If criminal liability is extinguished by some other
manner, but where it is clear that the accused was the
author of the act or omission complained of as having
caused damage or injury to a private complainant, the
civil liability is not extinguished and can be enforced
in the same action or a separate action (see CIVIL
CODE, Art. 29).
E. QUASI-DELICT
Whoever by act or omission causes damage to
another, there being fault or negligence, is obliged to
pay for the damage done. Such fault or negligence, if
there is no pre-existing contractual relation between
the parties, is called a quasi-delict (CIVIL CODE, Art.
2176).
Requisites of Quasi-delict: (DFC)
1. Damage suffered by the plaintiff;
2. Fault or negligence of the defendant; and
3. Causal connection between the fault or
negligence of defendant and the damage
incurred by the plaintiff (Guillang v. Bedania, G.R.
No. 162987, May 21 2009).
Negligence
Negligence is the omission of that diligence which is
required by the circumstances of person, place, and
time (CIVIL CODE, Art. 1173). Thus, the finding of
negligence is a question of fact (Philippine National
Railways Corporation v. Vizcara, G.R. No. 190022,
February 15, 2012).
Negligence is defined as the failure to observe for the
protection of the interest of another person that
degree of care, precaution, and vigilance which the
circumstances justly demand, whereby such other
person suffers injury (Guillang v. Bedania, G.R. No.
162987, May 21, 2009).
Test of Negligence: The test of negligence is
objective. It is measured by the act or omission of the
tortfeasor with a perspective as that of an ordinary
reasonable person who is similarly situated. The test
is whether or not the tortfeasor, under the attendant
circumstances, used that reasonable care and
caution which an ordinary reasonable person would
have used in the same situation (Makati Shangri-La
Hotel and Resort, Inc. v. Harper, G.R. No. 189998,
August 29, 2012).
Rather, did the defendant in doing the alleged
negligent act use that reasonable care and caution
which an ordinary person would have used in the
same situation? What an ordinary prudent person will
do under the circumstance can be determined by
asking the following: could a prudent man, in the case
under consideration, foresee harm as a result of the
course actually pursued? (Picart v. Smith, Jr., G.R.
No. L-12219, March 15, 1918)
Proximate Cause
The negligent act or omission must be the proximate
cause of the injury (Josefa v. Manila Electric
Company, G.R. No. 182705, July 18, 2014).
Proximate cause is defined as that cause, which, in
natural and continuous sequence, unbroken by any
efficient intervening cause, produces the injury, and
without which the result would not have occurred
(Mendoza v. Spouses Gomez, G.R. No. 160110,
June 18, 2014).
Necessity of Proving Negligence
In order for liability from negligence to arise, there
must be not only proof of damage and negligence, but
also proof that the damage was the consequence of
the negligence (Abrogar v. Cosmos Bottling
Company, G.R. No. 164749, March 15, 2017).
However, since negligence may in some cases be
hard to prove, the doctrine of res ipsa loquitor (the
thing speaks for itself) may be applied. It
recognizes that parties may establish prima facie
negligence without direct proof, thus, it follows the
principle to substitute for specific proof of negligence.
It permits the plaintiff to present along with proof of
the accident, enough of the attending circumstances
to invoke the doctrine, create an inference or
presumption of negligence and thereby place on the
defendant the burden of proving that there was no
negligence on his part (Del Carmen, Jr. v. Bacoy,
G.R. No. 173870, April 25, 2012).
The requisites of res ipsa loquitor are as follows:
1. The event is of a kind which does not ordinarily
occur unless someone is negligent;
2. The cause of the injury was under the exclusive
DELICT QUASI-DELICT
control of the person in charge; and
3. The injury suffered must not have been due to As to Employer’s Liability
any voluntary action or contribution on the part of
the person injured (Geromo v. La Paz Housing Employer’s liability is Employer’s liability is
and Dev Corp, G.R. No. 211175, January 18, subsidiary. The primary; can be sued
2017). employee must have first directly by the injured
been convicted and party and may recover
DELICT V. QUASI-DELICT sentenced to pay civil from his employee.
indemnity and it must be
DELICT QUASI-DELICT
shown that he is
As to Whom it is Committed insolvent.

Public Interest: Wrong Private Interest: wrong As to Employer’s Engagement

against the individual and against the individual.
Employer is liable only All employers whether
the State.
when he is engaged in they are engaged in
As to Existence of Criminal Intent some kind of business or some enterprise or not
industry. are liable, this includes
There is criminal or There is only house helpers.
malicious intent or negligence. (DE LEON, Obligations and Contracts, supra at 30;
criminal negligence. JURADO, Obligations and Contracts, supra at 21;
Elcano v. Hill, G.R. No. L-24803, May 26, 1977).
As to Liability

Generally, criminal and Only civil. Several Obligations Arising from Single Act or
civil. Omission
The enumeration [in Article 1157] does not preclude
As to Purpose the possibility that a single action may serve as the
source of several obligations to pay damages in
Punishment Indemnification of the accordance with the CIVIL CODE (Tankeh v.
offended party Development Bank of the Philippines, G.R. No.
171428, November 11, 2013).
As to its Scope
Example: Ejecting a passenger already seated
Not as broad as quasi- Actionable in any act inside the plane for no reason other than racial
delict; can be punished or omission wherein discrimination - (1) consequences arising from
only when there is a fault or negligence breach of contract and (2) payment of damages
penal law clearly intervenes. arising from law as a result of morally reprehensible
penalizing it. manner of breach of contract (Air France v.
Carrascoso, G.R. No. L-21438, September 28, 1966).
As to Form of Redress Prohibition from Double Recovery
Form of redress is either Either by Although a single act or omission may give rise to two
fine or imprisonment or compensation or different causes of action, the plaintiff cannot recover
both. indemnification. damages twice for the same act or omission of the
defendant (CIVIL CODE, Art. 2177).

As to Proof Required

Must be proven beyond Requires

reasonable doubt. preponderance of
evidence.

As to Compromise

Can never be Can be compromised

compromised. as any other civil
liability.

NATURE AND EFFECT OF
OBLIGATIONS
(ARTS. 1163-1178)
OBLIGATION TO GIVE
WHEN OBLIGATION TO DELIVER
ARISES
GENERAL RULE: The obligation to deliver arises
from the time of the perfection of the contract.
EXCEPTIONS:
1. If the obligation is subject to a
suspensive condition or period.
It arises upon fulfillment of the condition or arrival
of the period (CIVIL CODE, Arts. 1179, 1189, and
1193).
NOTE: The parties may make a stipulation to the
contrary as regards the right of the creditor to the
fruits of the thing.
2. If obligation is based on a source other
than contract
The specific provisions of applicable law shall
determine when the delivery of the thing shall be
effected (DE LEON, Obligations and Contracts,
supra at 37).
DELIVERY
Delivery is an act by which one party parts with the
title to and the possession of the property, and the
other acquires the right to and possession of the
same (NFF Industrial Corporation v. G&L Associated
Brokerage, G.R. No. 178169, January 12, 2015).
PURPOSE OF DELIVERY
The purpose of delivery is not only for the enjoyment
of the thing but also a mode of acquiring dominion
and determines the transmission of ownership, the
birth of the real right (Cebu Winland Development
Corporation v. Ong Siao Hua, G.R. No. 173215, May
21, 2009).
KINDS OF DELIVERY
1. Actual delivery (tradition)
In sale, for example, actual delivery of the thing
sold occurs when it is placed under the control
and possession of the vendee (The Roman
Catholic Church v. Pante, G.R. No. 174118, April
11, 2012).
2. Constructive delivery
Where although physical possession is not
placed in the hands of the obligee, it is
nevertheless irrevocably placed in his effective
control
a. Traditio symbolica (symbolic tradition) –
as when the keys of a bodega are given
NOTE: Delivery of the key to the car garage
where a car and its key are kept is symbolic
delivery. Delivery of the car keys themselves
is actual delivery.
b. Traditio longa manu – delivery by mere
consent or the pointing out of the object);
c. Traditio brevi manu– whereby the
possessor of a thing is constituted as owner
thereof;
Example: The lessee who had been living in
a house for 10 years becomes absolute
owner upon payment of the last installment of
a rent-to-own contract.
d. Constitutum possessorium – the opposite
of brevi manu where the owner is made into
a mere possessor thereof
Example: Where the original owner sells a
building to a vendee but the former continues
to possess the property in some other
manner such as a lessee.
e. Delivery of Instrument or Document of
Title – The delivery of a document
evidencing title to the thing, such as a
negotiable warehouse receipt.
OBJECT OF THE PRESTATION
The object of an obligation is not a thing but a
particular conduct of the debtor. The object of an
obligation is thus always a prestation, which may
consist in giving or doing or not doing something (4
TOLENTINO, supra at 57-58).
The obligation to deliver may be an obligation to
deliver:
1. Specific or Determinate Thing
2. Generic Thing
3. Limited Generic (Id. at 91)
SPECIFIC OR DETERMINATE THING
A thing is determinate when it is particularly
designated or physically segregated from all others of
the same class (CIVIL CODE, Art. 1460, par.1).
Thing Deemed Specific, Determination Does Not SPECIFIC V. GENERIC OBLIGATION
Require Subsequent Agreement
The requisite that a thing be determinate is satisfied SPECIFIC GENERIC
if at the time the contract is entered into, the thing is
As to Obligation to Deliver
capable of being made determinate without the
necessity of a new or further agreement between the The obligor must deliver The obligor may deliver
parties (CIVIL CODE, Art. 1460, par. 2). the very thing promised any thing from the same
(CIVIL CODE, Art. class which is neither
GENERIC OR INDETERMINATE THING 1165; 1244). superior nor inferior in
A thing is generic or indeterminate in the sense that it quality (CIVIL CODE,
is designated merely by its class or genus without any Art. 1246).
particular designation or physical segregation from all
others of the same class, the loss or destruction of As to Effect of Loss
anything of the same kind even without the debtor’s
fault and before he has incurred in delay will not have Loss of the thing Can never be affected
the effect of extinguishing an obligation. extinguishes the by loss because things
obligation to deliver, of the same class, kind,
The rule is based on the principle that the genus of a without prejudice to and quality can be
thing can never perish. Genus nunquam perit. Article 1170. delivered.
(Gaisano Cagayan, Inc. v. Insurance Company of
As to Remedy in Case of Delay or Breach
North America, G.R. No. 147839, June 8, 2006, see
also CIVIL CODE, Art. 1263). Right to compel delivery Right to compel delivery
of the thing itself or right to charge the
LIMITED GENERIC THING (Specific Performance) expense of compliance
When the generic objects are confined to a particular (CIVIL CODE, Art. by another (CIVIL
class. The class is considered in itself a determinate 1165, par. 2). CODE, Art. 1165, par.
object. 2).

Example: An obligation to deliver one of my horses,

because the thing is limited to the horses owned by
LIMITED GENERIC V. GENERIC
the debtor and he cannot deliver any horse not owned OBLIGATION
by him (4 TOLENTINO, supra at 91). LIMITED GENERIC GENERIC

NOTE: Loss of a generic thing does not extinguish As to Obligation to Deliver

the obligation, except in case of limited generic
things, where the kind itself, and the whole class The obligor must The obligor may deliver
perishes. deliver the generic any thing from the same
object from a particular class which is neither
SPECIFIC V. GENERIC OBJECT class (4 TOLENTINO, superior nor inferior in
supra at 91). quality (CIVIL CODE,
SPECIFIC GENERIC Art. 1246).
“X’s blue car” a car As an Illustration

“The P100 bill bearing P100.00 An obligation to deliver An obligation to deliver a

the autograph of one of the debtor’s cars car
celebrity pop star X”

“A healthy male horse A horse ACCESSORY OBLIGATIONS TO

from X’s stable” OBLIGATION TO DELIVER SPECIFIC
THING
“The harvest of this rice 100 sacks of jasmine
1. Obligation to Take Care of the Thing to be
land in the next harvest rice
Delivered (CIVIL CODE, Art. 1163);
season”
2. Obligation to Deliver the Fruits of the Thing
(CIVIL CODE, Art. 1164); and
3. Obligation to Deliver Accessions and
Accessories (CIVIL CODE, Art. 1166).
NOTE: An express stipulation to the contrary
between the parties shall prevail over these statutory
provisions.
OBLIGATION TO TAKE CARE OF THE
THING TO BE DELIVERED
Every person obliged to give something is also
obliged to take care of it with the proper diligence of
a good father of a family (CIVIL CODE, Art. 1163).
NOTE: The accessory obligation to take care ends
upon delivery of the thing itself.
REASON: The obligor must deliver the thing itself
and cannot compel the obligee to receive a different
one, although the latter may be of the same value as,
or more valuable than that which is due (CIVIL
CODE, Art. 1244).
The debtor must exercise diligence to insure that the
thing to be delivered would subsist in the same
condition as it was when the obligation was
contracted. Otherwise, the debtor would be able to
afford being negligent and he would not be liable
even if the property is lost or destroyed, thus
rendering illusory the obligation to give (DE LEON,
Obligations and Contracts, supra at 35).
DILIGENCE OF A GOOD FATHER OF A
FAMILY
The diligence of a good father of a family requires
only that diligence which an ordinary prudent man
would exercise with regard to his own property
(Wildvalley Shipping, Co. Ltd. v. The Court of
Appeals, G.R. No. 119602, October 6, 2000).
HIERARCHY OF STANDARDS OF
DILIGENCE
1. Extraordinary Diligence
- That extreme measure of care and caution
which persons of unusual prudence and
circumspection use for securing and preserving
their own property or rights(applies to banks and
common carriers)
2. Ordinary Diligence or Bonus Pater
Familias
– The reasonable care a prudent man can be
expected to exert to protect his own property
3. Simple Diligence
– that reasonable care a prudent man can be
expected to exert to protect another person’s
property
A different standard of care may be stipulated by
the parties
Every person obliged to give something is also
obliged to take care of it with the proper diligence of
a good father of a family, unless the law or the
stipulation of the parties requires another standard of
care (CIVIL CODE, Art. 1163). The Civil Code
provides that if the law or contract does not state the
diligence which is to be observed in the performance
of an obligation that which is expected of a good
father of the family shall only be required (Orient
Freight International Inc. v. Keihin-Everett
Forwarding Company Inc., G.R. No. 191937, August
9, 2017).
OBLIGATION TO DELIVER THE FRUITS
OF THE THING
The creditor has a right to the fruits of a thing from the
time the obligation to deliver arises (CIVIL CODE, Art.
1164).
In case of law, quasi-contracts, delicts and quasi-
delicts, the obligation to deliver arises from the time
designated by the provisions of the CIVIL CODE,
Penal Laws, or Special Laws creating or regulating
them.
In case of contracts, the obligation arises from the
time of the perfection of the contract or stipulation of
the parties unless it is subject to a suspensive
condition, suspensive term or period, or if there is a
contrary stipulation of the parties.
FRUITS
1. Natural Fruits
a. spontaneous products of the soil, and
b. the young and other products of animals
produced (CIVIL CODE, Art. 442, par. 1)
2. Industrial
Those produced by lands of any kind through
cultivation or labor (CIVIL CODE, Art. 442, par. 2)
3. Civil
Those derived by virtue of juridical relation (CIVIL
CODE, Art. 442, par. 3).
Example: Rents from lease contract; interest on
bank deposits assigned.
RIGHT TO FRUITS ACCRUES UPON
DELIVERY
The creditor has a right to the fruits of the thing from
the time the obligation to deliver it arises. However,
he shall acquire no real right over it until the same has
been delivered to him (CIVIL CODE, Art. 1164, par.
1).
Illustration: SPECIFIC V. GENERIC OBLIGATION
On May 25, 2021 X and Y entered into a contract
wherein X would deliver her only eleven month old SPECIFIC GENERIC
Dalmatian named BB on Valentine’s Day 2022.
As to Primary Obligation
Pending the delivery, BB gave birth to 101 Dalmatian
puppies on December 2021. Who is the owner of the The obligor must deliver The obligor may deliver
puppies? the very thing promised any thing from the same
(CIVIL CODE, Art. class which is neither
X is the owner of the puppies. Art. 1164 provides that 1165; 1244). superior nor inferior in
the creditor (Y) has the right to the fruits of the thing quality (CIVIL CODE,
from the time the obligation to deliver it arises. In this Art. 1246).
case, BB gave birth to the 101 Dalmatians before the
obligation to deliver it on February 14, 2022. Hence, As to Accessory Obligations
X has the right to own the fruits (puppies) of BB.
1. Obligation to Take N/A.
REAL RIGHT V. PERSONAL RIGHT Care of the Thing to
Real right over a thing pertains to all direct rights to be Delivered (CIVIL
ownership of a res (thing). It is also called jus in re or CODE, Art. 1163)
“legal title” over something. 2. Obligation to Deliver
the Fruits of the
Personal right is merely the right to the performance Thing (CIVIL CODE,
of an obligation, that is to the prestation itself and not Art. 1164)
to the object of the prestation. In the context of the 3. Obligation to Deliver
obligation to give, it is the right to “be given the thing” Accessions and
and not the right to “the thing itself.” It is also called Accessories (CIVIL
jus ad rem or a “beneficial right” over something. CODE, Art. 1166)

As to Risk of Loss of Thing Due

OBLIGATION TO DELIVER ACCESSIONS
AND ACCESSORIES GENERAL RULE: Loss, regardless of
The obligation to give a determinate thing includes Borne by Debtor until cause, does not relieve
that of delivering all of its accessions and delivered (CIVIL CODE, debtor of primary
accessories, even though they may not have been Art. 1165, par. 1, in rel. obligation to deliver
mentioned (CIVIL CODE, Art. 1166). to Art. 1170)

EXCEPTION: Loss due

ACCESSIONS
to fortuitous event
The ownership of property gives the right by (CIVIL CODE, Art.
accession to everything: 1174)
1. which is produced thereby; or
2. which is incorporated or attached thereto, either EXCEPTION TO
naturally or artificially (CIVIL CODE, Art. 440) EXCEPTION:
1. If the obligor is in
Examples: Fruits of a land still attached to the soil or delay;
plant from which they grow; Water in the swimming 2. If obligor has
pool; spoilers on a car. promised to deliver
the same thing to
ACCESSORIES two or more persons
Signifies all of those things which have for their object who do not have the
the embellishment, use or preservation of another same interest (CIVIL
thing which is more important and to which they are CODE, Art. 1165,
not incorporated or attached (JURADO, Obligations Par. 3)
and Contracts, supra at 48).

Examples: Paint on a house; Air Freshener inside a

car.
 CORRELATIVE RIGHTS OF THE CODE, Art. 1165,
CREDITOR par 3)
SPECIFIC GENERIC

As to Common Rights

Right to demand payment of damages if debtor is OBLIGATION TO DO

guilty of fraud, negligence, or delay in the OR NOT TO DO
performance of their obligation, and those in any
manner contravene the tenor thereof (CIVIL
CODE, Art. 1170).
THREE SITUATIONS CONTEMPLATED
As to Rights of Action Respecting
Primary Obligation UNDER ARTICLE 1167 WHICH REFERS
TO AN OBLIGATION TO DO:
1. Specific 1. Right to compel 1. The debtor fails to perform an obligation to do;
Performance (CIVIL delivery of a thing 2. The debtor performs an obligation to do, but
CODE, Art. 1165) which is neither of contrary to the terms thereof; or
2. Rescission of a superior nor inferior 3. The debtor performs an obligation to do but in a
Reciprocal quality (CIVIL poor manner (CIVIL CODE, Art.1167).
Obligation to Debtor CODE, Art. 1246)
in case of breach 2. Right to have the PERFORMANCE BY A THIRD PERSON
(CIVIL CODE, Art. obligation performed
A personal obligation to do, like a real obligation to
1191) by another at the
deliver a generic thing, can be performed by a third
expense of the
person (See CIVIL CODE, Art. 1165).
debtor (CIVIL CODE,
Art. 1165)
REMEDY OF SPECIFIC PERFORMANCE
As to Rights of Action Respecting Accessory NOT AVAILABLE IN PERSONAL
Obligation OBLIGATIONS
Unless otherwise N/A While the debtor can be compelled to make the
agreed: delivery of a specific thing, a specific performance
1. The right to compel cannot be ordered in a personal obligation to do
delivery of fruits because this may amount to involuntary servitude
accrued from which, as a rule, is prohibited under Section 18[2],
perfection of Art. III of the 1987 Constitution (DE LEON,
contract (CIVIL Obligations and Contracts, supra at 43).
CODE, Art. 1164)
2. The right to compel NOTE: Where the personal qualifications of the
delivery of debtor are the determining motive for the obligation
accessions and contracted (e.g., to sing in a nightclub), the
accessories present performance of the same by another would be
at perfection of impossible or would result to be so different that the
contract even if not obligation could not be considered performed.
specific in the Hence, the only remedy of the creditor is
contract (CIVIL indemnification (Id.).
CODE, Art. 1166)
3. The right to hold REMEDY IN CASE OF BREACH OF
debtor liable for loss POSITIVE PERSONAL OBLIGATION
even if resulting If a person obliged to do something fails to do it, the
from fortuitous event same shall be executed at his cost. This same rule
when loss occurred shall be observed if he does it in contravention of the
during delay or tenor of the obligation. Furthermore, it may be
when thing was decreed that what has been done poorly be undone
promised to two (CIVIL CODE, Art. 1167).
creditors with
different interests
prior to loss (CIVIL
REMEDY IN CASE OF BREACH OF NEGATIVE
POSITIVE PERSONAL
NEGATIVE PERSONAL OBLIGATION PERSONAL
OBLIGATION
When the obligation consists in not doing, and the OBLIGATION
obligor does what has been forbidden him, what has
been done may be undone at his expense (CIVIL (CIVIL CODE, Art. been done in breach
CODE, Art. 1168). 1167) of obligation, if
2. To shoulder the cost possible (CIVIL
NOTE: In obligations not to do, the duty of the obligor when some else – CODE, Art. 1168);
is to abstain from an act. Here, there is no specific a. does or 2. To pay Damages
performance. The very obligation is fulfilled in not accomplishes (CIVIL CODE, Arts.
doing what is forbidden. Hence, in this kind of what was 1170-1172, 2201-
obligation the debtor cannot be guilty of delay (DE promised 2202).
LEON, Obligations and Contracts, supra at 44). b. undoes what was
done
poorly(CIVIL
WHEN REMEDY TO COMPEL UNDOING CODE, Art.
NOT AVAILABLE: 1167);
1. Where the effects of the act which is 3. To pay Damages
forbidden are definite in character (CIVIL CODE, Arts.
Even if it is possible for the obligee to ask that the 1170-1172, 2201-
act be undone at the expense of the obligor, 2202).
consequences permanent in character and
contrary to the object of the obligation will be
DUTIES OF THE DEBTOR V. DUTIES OF
produced (JURADO, Obligations and Contracts,
supra at 55). THE CREDITOR
OBLIGATION TO DO
Illustration: For instance, should a TV star be
absolutely prohibited by his contract with his 1. To Do it (CIVIL 1. To have the
home station to appear in programs of other TV CODE, Art. obligation Executed
stations, the effects of the breach thereof can no 1167); at the cost of the
longer be undone. 2. To Shoulder the debtor (CIVIL
cost of execution CODE, Art. 1167);
2. Where it is physically or legally should he fail to do 2. To recover
impossible to undo what has been done it (Id); Damages in case of
because of the very nature of the act itself 3. To Undo what has breach (CIVIL
or of a provision of law, or because of been poorly done CODE, Art. 1170).
(Id);
conflicting rights of third persons (Id.).
4. To pay Damages in
case of breach
Note: In obligations to do or not to do, an act or
(CIVIL CODE, Art.
forbearance cannot be substituted by another act
1170).
or forbearance against the obligee’s will (CIVIL
CODE, Art. 1244, par. 2).
OBLIGATION NOT TO DO
SUMMARY OF PERSONAL
OBLIGATIONS (NSD) (UR)
1. Not to do what 1. To ask to Undo what
NEGATIVE should not be should not be done,
POSITIVE PERSONAL
PERSONAL done; at the debtor’s
OBLIGATION
OBLIGATION 2. To Shoulder the expense (CIVIL
cost of undoing CODE, Art. 1168);
As to Primary Obligation
(CIVIL CODE, Art. 2. To Recover
To do what was Not to do a specific act 1168); damages, where it
promised (CIVIL CODE, or omission (CIVIL 3. To pay Damages in would be physically
Art. 1167). CODE, Art. 1168). case of breach or legally impossible
(CIVIL CODE, Art. to undo what should
As to Liability in Case of Breach 1170). not have been done
because of the very
1. To undo what has 1. To shoulder the costs nature of the act
been poorly done of undoing what has itself, rights
 acquired by third ARTICLE 1170 OF THE CIVIL CODE
persons who acted APPLIES WHEN A BREACH OF DUTY IS
in good faith, when NEITHER PART OF A CONTRACT OR A
the effects of the QUASI-DELICT
acts prohibited are
Those liable under Art. 1170 should pay damages,
definite in character
but generally only if aside from the breach of contract,
and will not cease
prejudice or damage was caused (Berg v. Teus, G.R.
even if the thing
No. L-6453, October 30, 1964).
prohibited be
undone.
VOLUNTARY BREACH THROUGH
FRAUD OR DOLO
Fraud or dolo consists in the conscious and
intentional proposition to evade the normal fulfillment
BREACH OF of an obligation. This type of fraud, which is present
OBLIGATIONS during the performance of an obligation, must not be
confused with the causal or incidental fraud, which is
present at the time of the birth of an obligation. Under
our legal system, fraud in general may be classified
BREACH OF OBLIGATION/CONTRACT into civil and criminal fraud. Civil fraud, in turn, may
be classified into the following: first, the fraud or dolo
The failure without legal reason to comply with the
terms of the contract. It is also defined as the failure in the performance of an obligation; and second, the
fraud or dolo in the constitution or establishment of an
without legal excuse, to perform any promise which
obligation (JURADO, Obligations and Contracts,
forms the whole or part of the contract (Philippine
supra at 63).
National Bank v. Spouses Tajonera, G.R. No.
195889, September 24, 2014).
CRIMINAL FRAUD V. CIVIL FRAUD
BREACH OF OBLIGATION MAY BE: CRIMINAL FRAUD CIVIL FRAUD
1. As to Imputability of Liability
a. Voluntary – arises either by fraud, As to When Existing
negligence, delay, and in any manner Criminal fraud exists Civil Fraud exists when
contravene the tenor of the obligation (CIVIL when an act is there is a deliberate
CODE, Art. 1170); performed with malicious intent to
b. Involuntary – arises due to fortuitous events deliberate intent cause injury to another
(CIVIL CODE, Art. 1174); (REVISED PENAL person through acts or
CODE, Art. 3). omissions which are not
2. As to Magnitude normally punishable by
a. Substantial – fundamental breaches that NOTE: Criminal fraud law.
defeat the object of the parties in entering pertains to the essential
into agreement (Maglasang v. Northwestern element of malicious Civil Fraud is
Inc., G.R. No. 188986, March 20, 2013); and intent necessary to contractual where it
b. Casual – breaches which do not amount to a commit an act or relates to the creation or
fundamental injury to the contractual intent omission punishable by performance of
such as delay in payment where time is not law. contractual duty.
of the essence.
As to Effect
DIFFERENT MODES OF BREACH
Those who in the performance of their obligations are It is a mode of incurring It is a mode of incurring
guilty of: (FNDC) criminal liability. civil liability
1. Fraud (dolo)
Examples
2. Negligence (culpa)
3. Delay (mora) Intent to kill or intent to Contractual Fraud
4. Contravention of the tenor thereof (violatio) gain by taking property Intent to use
(CIVIL CODE, Art. 1170). with clear, chargeable substandard materials
knowledge that it to cut costs and obtain
belongs to another more profit under a
(RPC, Arts. 249 & 308). construction agreement
(Sps. David v. CIAC,
 b. Waiver of future fraud gives license to a
G.R. 159795, July 30,
contracting party to breach the contract
2004).
without consequence. Such a waiver
severely undermines the stability of
Tortious Fraud
contracts. It is void for being contrary to good
Deliberate invasion of
customs, morals, and public policy (CIVIL
privacy of another (Sps.
CODE, Art. 6)
Hing v. Choachuys,
G.R. No. 179736, June
26, 2013). 2. Waiver of Past Fraud generally not invalid
Rights may be waived, unless the waiver is
contrary to law, morals, or good customs (CIVIL
FRAUD IN THE CONSTITUTION OF AN CODE, Art. 6).
OBLIGATION V. FRAUD IN THE
PERFORMANCE OF AN OBLIGATION A past fraud can be the subject of a valid waiver.
Here, what is renounced is the effects of fraud,
Fraud in the Fraud in the that is, the right to indemnity of the party entitled
CONSTITUTION PERFORMANCE thereto (DE LEON, Obligations and Contracts,
of an obligation of an obligation supra at 63-64).
As to When Existing Waiver can be considered as an act of generosity
and magnanimity on the part of the party who is
Present only at the time Present only during the
the victim of the fraud (Id. at 63-64).
of the birth of the performance of a pre-
obligation. existing obligation.
CONTRACTUAL NEGLIGENCE
As to Purpose of Employment
CULPA CONTRACTUAL
Employed for the Employed for the
The fault or negligence of the obligor consists in the
purpose of securing the purpose of evading the
omission of the diligence which is required by the
consent of the other normal fulfillment of an
nature of the obligation and corresponds with the
party to enter into obligation already
circumstances of the persons, of the time and place
contract. established.
(CIVIL CODE, Art. 1173, par. 1).
As to Effect
In culpa contractual, the mere proof of the existence
Results in the vitiation Results in the non- of the contract, and the failure of its compliance,
of his consent. fulfillment or breach of justify prima facie a corresponding right of relief (FGU
the obligation. Insurance Corp. v. GP Sarmiento Trucking Corp.,
G.R. No. 141910. August 6, 2002).
As to Remedy
Negligence is conduct that creates an undue risk of
Gives rise to a right of Gives rise to a right of harm to others. It is the failure to observe that degree
the innocent party to the creditor or obligee to of care, precaution and vigilance that the
ask for the annulment of recover damages from circumstances justly demand. It is the omission to do
the contract if the fraud the debtor or obligor something which a reasonable man, guided by
is causal or to recover (CIVIL CODE, Art. considerations that ordinarily regulate the conduct of
damages if it is 1170). human affairs, would do, or doing something that a
incidental (CIVIL prudent and reasonable man would not do (Cang v.
CODE, Art. 1390). Cullen, G.R. No. 163078, November 25, 2009).
(Id. at 63).
NOTE: The effect of every infraction is to create a
new duty, that is, to make recompense to the one who
WAIVER OF FRAUD
has been injured by the failure of another to observe
1. Any waiver of action for future fraud is his contractual obligation unless he can show
void (CIVIL CODE, Art. 1171). extenuating circumstances, like proof of his exercise
of due diligence (normally that of the diligence of a
REASONS: good father of a family or, exceptionally by stipulation
a. Responsibility arising from fraud is or by law such as in the case of common carriers, that
demandable in all obligations (CIVIL CODE, of extraordinary diligence) or of the attendance of
Art. 1171). fortuitous event, to excuse him from his ensuing
liability. (Radio of the Philippines Communications, a pre-existing contract(JURADO, Obligations and
Inc. V. Verchez, G.R. No. 164349, January 31, 2006). Contracts, supra at 65);

Test of Negligence 2. Civil negligence(Culpa aquiliana; also

Did the defendant in doing the alleged negligent act called tort or quasi-delict)
use that reasonable care and caution which an – fault or negligence of a person which causes
ordinary prudent person would have used in the same damage to another where there is no pre-existing
situation? The law considers what would be reckless, contractual relation between the parties (CIVIL
blameworthy, or negligent in the man of ordinary CODE, Art. 2176);
intelligence and prudence and determines liability by
that (Philippine National Railways Corporation v. 3. Criminal Negligence (Culpa Criminal)
Vizcara, G.R. No. 190022, February 15, 2012). – fault or negligence which had it been
intentional, would constitute a felony (REVISED
PENAL CODE, Art. 365).
Factors to be considered
Negligence is a question of fact, its existence being
CULPA CONTRACTUAL V. CULPA
dependent upon the particular circumstances of each
case. The following factors must be considered: AQUILIANA V. CULPA CRIMINAL
(NaP-TiP) CULPA CULPA CULPA
1. Nature of the obligation; CONTRACTUAL AQUILIANA CRIMINAL
2. Circumstances of the Person;
3. Circumstances of Time; and As to the Character of the
4. Circumstances of the Place (CIVIL CODE, Art. Negligence of the Defendant
1173).
Negligence is Negligence is Negligence is
Standard of Diligence Required merely incidental direct, direct,
If law or contract does not state the diligence which is to the substantive, substantive,
to be observed in the performance, that which is performance of and and
expected of a good father of a family is required an obligation independent. independent.
(CIVIL CODE, Art. 1173, par. 2). already existing
because of a
If the obligor acted in good faith, he shall be liable contract.
only for natural and probable consequences of the
breach of obligation and which the parties have As to the Relationship of the Parties
foreseen or could have reasonably foreseen at the
There is always a There may or Relationship
time the obligation was constituted (CIVIL CODE,
pre-existing may not be a immaterial.
Art. 2201, par. 1; Continental Cement Corporation v.
contractual pre-existing
Asea Brown Boveri, Inc., G.R. No. 171660, October
relation. contractual
17, 2011).
relation.
Kinds of Diligence Required under Art. 1173: As to the Source of Obligation
(ARF)
1. The Agreed upon by the parties, orally or in Breach or non- Injury Defendant’s
writing; fulfillment of proximately criminal act.
2. In the absence of stipulation, that Required by contract. caused by the
law in the particular case (e.g., extraordinary negligent act or
diligence for common carriers); and omission.
3. If both contract and law are silent, then the
diligence expected of a good Father of a family As to Proof Required
(bonus pater familia) (CIVIL CODE, Art. 1173).
Requires proof Requires proof Requires
CONTRACTUAL NEGLIGENCE by by proof beyond
preponderance preponderance reasonable
DISTINGUISHED FROM OTHER TYPES of evidence. of evidence. doubt.
OF NEGLIGENCE IN LAW
1. Contractual negligence (Culpa As to the Availability of Diligence as a Defense
contractual)
Exercise of Due Exercise of Due Diligence
– fault or negligence of obligor by virtue of which
diligence is a Due diligence is not a
he is unable to perform his obligation arising from
valid defense is a valid defense
 CULPA CULPA CULPA WHEN NEGLIGENCE EQUIVALENT TO
CONTRACTUAL AQUILIANA CRIMINAL FRAUD
Where the negligence shows bad faith or is so gross
except where law defense except unless it that it amounts to malice or wanton attitude on the
or contract where law or constitutes a part of the defendant, the rules on fraud shall apply
imposes strict contract justifying or (CIVIL CODE, Art. 1173).
liability. imposes strict exempting
liability. circumstance.
FRAUD (DOLO) V. NEGLIGENCE
As to the Presumption of Fault (CULPA)
FRAUD NEGLIGENCE
Proof of Plaintiff has to Accused is
(DOLO) (CULPA)
existence of a prove presumed
contract and negligence of innocent, until As to Willfulness to Cause Damage
breach thereof the defendant. the contrary is
gives rise to a proved. Willfulness or deliberate Mere want of care or
presumption of intent to cause damage diligence and not the
fault. or injury to another voluntariness of act or
omission
PRESUMPTION OF CONTRACTUAL
NEGLIGENCE As to Mitigation of Liability
Proof that the contract (1) exists and (2) has been
breached gives rise to the presumption of negligence Liability cannot be Liability may be
on the part of the obligor such that he must show with mitigated by courts. mitigated by courts.
clear and convincing proof that he exercised due
diligence or that he was not responsible for the As to Validity of Waiver
breach.
Waiver for future fraud Waiver for future
is void. negligence:
EFFECTS OF NEGLIGENCE: 1. Valid if simple
1. Damages are demandable which the court may 2. Void if gross
regulate according to circumstances (CIVIL
CODE, Art. 1172); and As to How it is Proved
2. Invalidates defense of fortuitous event (4
TOLENTINO, supra at 130). Presumed from the Must be clearly proved.
breach of a contractual
EFFECT IF OTHER PARTY ALSO GUILTY obligation.
OF CONTRACTUAL NEGLIGENCE (4 PARAS, supra at 140).
Both parties are liable for damages to each other
resulting from their own negligence. Such mutual GROSS INEXCUSABLE NEGLIGENCE
liability may be set off against each other in It is negligence characterized by the want of even
accordance with the rules on Compensation under slight care-acting or omitting to act in a situation
Articles 1278-1290 of the CIVIL CODE. where there is a duty to act, not inadvertently but
willfully and intentionally, with a conscious
NOTE: Some authors use as basis Article 2179 of the indifference to consequences insofar as other
CIVIL CODE. It must be noted however that persons may be affected (Jaca v. People, G.R. No.
contractual negligence and negligence as an element 166967, January 28, 2013).
of quasi-delict gives rise to separate liabilities and do
not have the same effects. BREACH BY DELAY
WAIVER OF ACTION FOR FUTURE ORDINARY DELAY
NEGLIGENCE It refers to the non-fulfillment of an obligation with
An action for future negligence (not fraud) may be respect to time (J Plus Asia Development Corporation
renounced except where the nature of the obligation v. Utility Assurance Corporation, G.R. No. 199650,
requires the exercise of extraordinary diligence as in June 26, 2013).
the case of common carrier (CIVIL CODE, Art. 1173;
DE LEON, Obligations and Contracts, supra at 63). NOTE: Mere delay does not result in breach.
LEGAL DELAY OR DEFAULT OR MORA
Those obliged to deliver or to do something incur in
delay from the time the obligee judicially or extra-
judicially demands from them the fulfillment of their
obligation (CIVIL CODE, Art. 1169, par. 1).
The law contemplates legal delay. Those obliged to
deliver or to do something incur in delay from the time
the obligee judicially or extrajudicially demand from
them the fulfillment of their obligation. In reciprocal
obligations, from the moment one of the parties fulfills
his obligation, delay by the other begins (Solar
Harvest, Inc. v. Davao Corrugated Carton
Corporation, G.R. No. 176868, July 26, 2010).
Delay in the performance of the obligation, however,
must be either malicious or negligent. If delay is only
due to inadvertence without any malice or
negligence, the obligor cannot be liable under Art.
1170 of the CIVIL CODE (RCBC v. CA, G.R. No.
133107, March 25, 1999).
KINDS OF DEFAULT:
1. Mora Solvendi
– default of obligor
2. Mora Accipiendi
– default of oblige
3. Compensatio Morae
– default on the part of both debtor/obligor and
the creditor/obligee which arises in reciprocal
obligations.
A. MORA SOLVENDI
Delay on the part of the debtor by not performing his
obligation after a demand/specified time and may
either be:
1. Ex Re– obligations to give; and
2. Ex Persona– obligations to do (JURADO,
Obligations and Contracts, supra at 57).
Requisites of Mora Solvendi: (D2P)
1. The obligation is Demandable and already
liquidated;
2. The debtor Delays performance; and
3. The creditor requires Performance, judicially or
extra-judicially (Polo S. Pantaleon v. American
Express International, Inc., G.R. No. 174269,
May 8, 2009).
Where Mora Solvendi Impossible
1. In obligations not to do, non-fulfillment may take
place but delay is impossible for the debtor fulfills
by not doing what has been forbidden him (DE
LEON, Obligations and Contracts, p. 46).
2. There is also no mora in natural obligations (4
PARAS, supra at 125).
Necessity of Demand
Without demand, judicial or extra-judicial, the effect
of default will not arise (Development Bank of the
Philippines v. Guarina Agricultural and Realty Dev.
Corp., G.R. No. 160758, January 15, 2014).
Exceptions: (OLTUA)
1. When the Obligation expressly so declares;
2. When the Law expressly so provides;
3. When Time is of the essence of the contract;
4. When demand would be Useless because of
a. some act or fault of the debtor; or
b. impossibility of performance caused by
fortuitous event (CIVIL CODE, Art. 1169)
5. When the obligor has expressly Acknowledged
that he really is in default (see Estoppel, CIVIL
CODE, Art. 1431)
NOTE: Mere asking for extension of time is not
an express acknowledgment of the existence of
default on his part.
Instance Where the Law Declares demand to be
unnecessary
A partner is liable for the fruits of the thing he may
have promised to contribute to the partnership from
the time they should have been delivered without the
need of any demand (CIVIL CODE, Art. 1786; see
also Art. 1788).
Instances where Time is of the Essence
1. The delivery of souvenirs on a particular date
when a wedding ceremony will be held.
2. The making of dress where the debut is
scheduled at a certain time.
3. The delivery of perishable goods.
Presumption that Time is NOT of the Essence
When the time of delivery is not fixed or is stated in
general and indefinite terms, time is not of the
essence of the contract. In such cases, the delivery
must be made within a reasonable time. What is
reasonable time will depend upon the circumstances
of the particular case (Lorenzo Shipping Corp. v. BJ
Marthel International Inc., G.R. No. 145483,
November 19, 2004).
Valid Demand
1. Judicial demand
—as when a complaint for specific performance
is filed (Palmares v. CA, G.R. No. 126490, March
31, 1998).
2. Extra-judicial demand
– as when a demand letter is served without court
proceedings.
NOTE: A mere reminder cannot be considered a
demand for performance, because it must appear
that the tolerance or benevolence of the creditor must
have ended (Vazquez v. Ayala Corporation, G.R. No.
149734, November 19, 2004).
Grace Period
A grace period is not an obligation of the debtor, but
a right. It must not be likened to an obligation, the
non-payment of which under Art. 1169 of the CIVIL
CODE would generally still require judicial or
extrajudicial demand before default can arise. When
unconditionally conferred, it is effective without need
of demand, either for the payment of the obligation or
for the honoring of the right (Optimum Development
Bank v. Spouses Jovellanos, G.R. No. 189145,
December 4, 2013, citing Bricktown Dev’t. Corp. v.
Amor Tierra Dev’t. Corp., G.R. No. 112182,
December 12, 1994).
Effects of Mora Solvendi
1. The debtor is guilty of breach of the obligation
(CIVIL CODE, Art. 1170);
2. He is liable for loss or delay even if caused by
fortuitous event when the obligation is to deliver
a determinate thing (CIVIL CODE, Arts. 1165 and
1170); and
3. He is liable for interest in case of obligations to
pay money (CIVIL CODE, Art. 2209), or damages
in other obligations (CIVIL CODE, Art. 1170).
NOTE: When the demand is established with
reasonable certainty, the interest shall begin to
run from the time the claim is made judicially or
extrajudicially but when such certainty cannot be
so reasonably established at the time the
demand is made, the interest shall begin to run
only from the date the judgment of the court is
made (Federal Builders, Inc. v. Foundation
Specialists, Inc., G.R. No. 194507, September 8,
2014).
B. MORA ACCIPIENDI
The delay on the part of the creditor without justifiable
reason to accept the performance of the obligation
(DE LEON, Obligations and Contracts, supra at 45).
NOTE: Read in relation to Arts. 1256-1261 (Tender
of Payment and Consignation).
Requisites of Mora Accipiendi: (PCR)
1. Offer of Performance by the debtor who has the
required capacity;
2. Offer must be to Comply with the prestation, as it
should be performed; and
3. Creditor Refuses the performance without just
cause (Polo S. Pantaleon v. American Express
International, Inc., G.R. No. 174269, May 8,
2009).
Remedy of Debtor in case of Mora Accipiendi
He must either:
1. Consign it in court (expenses chargeable to
creditor); or
2. Keep it himself, here he should still exercise
diligence and care, but this time, he would not be
liable for loss due to a fortuitous event (2
MANRESA 361).
Effects of Mora Accipiendi:
1. The creditor is guilty of breach of obligation;
2. Responsibility of the debtor for the thing is
reduced and limited to fraud and gross
negligence;
3. Debtor is exempted from the risks of loss of the
thing, which automatically passes to the creditor
(CIVIL CODE, Art. 1162);
4. All expenses incurred by the debtor for the
preservation of the thing after the delay shall be
chargeable to the creditor;
5. The creditor becomes liable for damages;
6. The debtor may relieve himself of the obligation
by consignation of the thing or sum due (CIVIL
CODE, Art. 1256); and
7. If the obligation bears interest, the debtor does
not have to pay from the moment of the creditor’s
delay (4 TOLENTINO, supra at 108).
C. COMPENSATIO MORAE
In reciprocal obligations, neither party incurs delay if
the other does not comply or is not ready to comply
in a proper manner with what is incumbent upon him.
From the moment one of the parties fulfills his
obligation, delay by the other begins (CIVIL CODE,
Art.1169, par. 3).
In reciprocal obligations, no demand is generally
necessary. But when different dates for performance
of the obligations are fixed, the default for each
obligation must be determined by the rules given in
the first paragraph of Art. 1169, that is, the other parry
would incur in delay only from the moment the other
party demands fulfillment of the former’s obligation
(Solar Harvest, Inc. v. Davao Corrugated Carton
Corporation, G.R. No. 176868, July 26, 2010).
Effects of Compensatio Morae:
1. Delay of the obligor cancels delay of the obligee
and vice versa;
2. No actionable default on the part of both parties;
and
3. If delay of one party is followed by that of the
other, the liability of the first infractor shall be
equitably balanced by the courts. If it cannot be
determined which of the parties is guilty of delay,
the contract shall be deemed extinguished and
each shall bear his own damages (CIVIL CODE,
Art. 1192).
BREACH BY DEFECTIVE
PERFORMANCE
CONTRAVENTION OF TENOR
The phrase “in any manner contravene the tenor” of
the obligation includes any illicit act or omission which
impairs the strict and faithful fulfillment of the
obligation and every kind of defective performance
(Victorino D. Magat v. Hon. Leo D. Medialdea, G.R.
No. L-37120, April 20, 1983).
Examples:
1. The taxi company is duty-bound to pay the
damages to the passenger if the driver kills the former
since the taxi company has the duty to protect the
passengers with utmost care (Maranan v. Perez,
G.R. No. L-22272, June 26, 1967);
2. If a person enters into a contract where he has to
meet certain bank requirements, but is unable to
meet said requirements, he is liable for breach of
contract, if he knew from the beginning that said
requirements could not be complied by him (Arrieta v.
NARIC, G.R. No. L-15645, January 31, 1964).
FORTUITOUS EVENTS
FORTUITOUS EVENT
Fortuitous events by definition are extraordinary
events not foreseeable or avoidable. It is therefore,
not enough that the event should not have been
foreseen or anticipated, as is commonly believed but
it must be one impossible to foresee or to avoid. The
mere difficulty to foresee the happening is not
impossibility to foresee the same (Sicam v. Jorge,
G.R. No. 159617, August 8, 2007).
REQUISITES OF FORTUITOUS EVENT:
(IFIF)
1. The event must be Independent of the human will
or at least of the obligor’s will;
2. The event could not be Foreseen, or if it could be
foreseen, it must have been impossible to avoid;
3. The event must be of such a character as to
render it Impossible for the obligor to fulfill his
obligation in a normal manner; and
4. The obligor must be Free from any participation
in the aggravation of the injury resulting to the
obligee (Philippine Realty and Holdings Corp.,
G.R. No. 165548, June 13, 2011).
CLASSIFICATION OF FORTUITOUS
EVENT
1. By Nature or Acts of God
– they are those events which are totally
independent of the will of every human being
(e.g., earthquake, flood, rain, shipwreck, lighting,
eruption of volcano, etc.) and which are also
called force majeure; and
2. By Act of Man
– fortuitous event independent of the will of the
obligor but not of other human wills (e.g., armed
invasion, attack by bandits, robbery etc.) (DE
LEON, Obligations and Contracts, supra at 77-
78).
NOTE: In law, fortuitous events and force majeure
are identical in so far as they exempt an obligor from
liability. Both are independent of the will of the obligor
(Republic of the Philippines v. Luzon Stevedoring
Corporation, G.R. No. L-21749, September 29,
1967).
CONCURRENT AND PREVIOUS
NEGLIGENCE OF OBLIGOR
The principle embodied in the act of God doctrine
strictly requires that the act must be occasioned
solely by the violence of nature. Human intervention
is to be EXCLUDED from creating or entering into the
cause of the mischief. When the effect is found to be
in part the result of the participation of man, whether
due to his active intervention or neglect or failure to
act, the whole occurrence is then humanized and
removed from the rules applicable to the acts of God
(Sulpicio Lines, Inc. v. Napoleon Sesante, G.R. No.
172682, July 27, 2016).
For defense of force majeure to prosper, it is
necessary that one has committed no negligence or
misconduct that may have occasioned the loss. An
act of God cannot be invoked to protect a person who
has failed to take steps to forestall the possible
adverse consequences of such a loss. Once
negligence may have concurred with an act of God in
producing damage and injury to another;
nonetheless, showing that the immediate or
proximate cause of the damage or injury was a
fortuitous event would not exempt one from liability
(RCPI v. Alfonso Verchez, G.R. No. 164349, January
31, 2006).
NOTE: It is based on the doctrine of volenti non fit
injuria – no wrong is done to one who consents
(JURADO, Obligations and Contracts, supra at 96).
EXAMPLES OF EVENTS NOT
FORTUITOUS
1. The fluctuating movement of the Philippine peso
in the foreign exchange market is an everyday
occurrence, and the fluctuations in currency
exchange rates happen every day, thus, not an
instance of caso fortuito (Fil-Estate Properties,
Inc. v. Sps. Ronquillo, G.R. No. 185798, January
13, 2014);
2. Increase in cost of performance (U.S. v.
Varadero de la Quinta, G.R. No. 14370,
September 1, 1919);
3. Poverty (Repide v. Alzelius, G.R. No. L-13438,
November 20, 1918);
4. War between the subjects of a neutral country
and the subject of a country at war, as long as
substantial compliance can still be done (Int.
Harvester Co. v. Hamburg-American Line, G.R.
No. L-11515, July 29, 1918); and
5. Mechanical defects in vehicles used for common
carriage (Necesito v. Paras, G.R. No. L-10605,
June 30, 1958).
EXTINGUISHMENT OF LIABILITY IN
CASE OF BREACH DUE TO
FORTUITOUS EVENT
Except in cases expressly specified by law, or when
it is otherwise declared by stipulation, or when the
nature of the obligation requires the assumption of
risk, no person shall be responsible for those events
which could not be foreseen or which, though
foreseen, were inevitable (CIVIL CODE, Art. 1174).
EXCEPTIONS TO DOCTRINE OF
FORTUITOUS EVENT: (LSA)
1. When expressly declared by Law;
2. When expressly declared by Stipulation or
contract; or
3. When the nature of the obligation requires the
Assumption of risk (CIVIL CODE, Art. 1174).
SOME LAWS WHICH STIPULATE
LIABILITY DESPITE FORTUITOUS
EVENT
1. The debtor is guilty of fraud, negligence, or delay,
or contravention of the tenor of the obligation
(CIVIL CODE, Art. 1170);
2. The debtor has promised to deliver the same
(specific) thing to two or more persons who do
not have the same interest for it would be
impossible for the debtor to comply with his
obligation to two or more creditors even without
any fortuitous event taking place (CIVIL CODE,
Art. 1165);
3. The debt of a thing certain and determinate
proceeds from a criminal offense (CIVIL CODE,
Art. 1268);
4. The thing to be delivered is generic in accordance
with the principle that genus never perishes
(CIVIL CODE, Art. 1263); and
5. Others (e.g. Arts. 552[2], 1942, 2147, 2148,
2000, 2001, 1198 and 2159 of the CIVIL CODE).
ASSUMPTION OF RISK
Assumption of the risk in its primary sense arises by
assuming through contract, which may be implied,
the risk of a known danger. The defense of
assumption of risk presupposes:
1. That the plaintiff had actual knowledge of the
danger;
2. That he understood and appreciated the risk from
the danger; and
3. That he voluntarily exposed himself to such risk
(Abrogar v. Cosmos Bottling Company, G.R. No.
164749, March 15, 2017).
EFFECTS OF LOSS BY FORTUITOUS
EVENT IN REAL OBLIGATIONS
1. On determinate obligation
– the obligation is extinguished (CIVIL CODE,
Art. 1174);
2. On generic obligation
– the obligation is not extinguished (genus nun
quam peruit – genus never perishes) (CIVIL
CODE, Art. 1263);and
3. On limited generic
– the obligation will extinguish when the whole of
the class perishes.
EFFECT OF FORTUITOUS EVENT ON
PERIOD PROVIDED
Where the contract stipulated that in case of a
fortuitous event, the period provided in the contract
for delivery shall be suspended, the period of time
when the contract was suspended cannot be
deducted from the term of the contract because to
add the said years upon the resumption of the
contract would in effect be an extension of the
contract (Victorias Planters Association Inc., v.
Victorias Milling Co, G.R. No. L-6648, July 25, 1955).

REMEDIES AGAINST
BREACH OF CONTRACT
PRIMARY REMEDIES OF CREDITORS:
(PDR)
1. Action for Performance (Specific Performance or
Substituted Performance);
2. Action for Damages (exclusively or in addition to
action for performance); and
3. Action for Rescission.
SUBSIDIARY REMEDIES OF
CREDITORS: (SPO)
1. Accion Subrogatoria;
2. Accion Pauliana; and
3. Other specific remedies.
ACTIONS FOR PERFORMANCE
1. Action for Specific Performance
When what is to be delivered is a determinate
thing, the creditor, in addition to his right for
indemnification of damages, may compel the
debtor to make the delivery (CIVIL CODE, Art.
1165, par. 1).
NOTE: The debtor of a thing cannot compel the
creditor to receive a different one, although the
latter may be of the same value as, or more
valuable than that which is due (CIVIL CODE, Art.
1244).
2. Action for Substituted Performance (in
obligation to give an indeterminate thing)
If the thing is indeterminate or generic, he may
ask that the obligation be complied with at the
expense of the debtor (CIVIL CODE, Art. 1165,
par. 2).
3. Action for Substituted Performance or
Undoing of Poor Work (in obligation to
do)
If a person obliged to do something fails to do it,
the same shall be executed at his cost. This same
rule shall be observed if he does it in
contravention of the tenor of the obligation.
Furthermore, it may de decreed that what has
been done poorly be undone (CIVIL CODE, Art.
1167).
4. Action for Undoing (in obligation not to
do)
GENERAL RULE: When the obligation consists
in not doing, and the obligor does what has been
forbidden him, it shall be undone at his expense
(CIVIL CODE, Art. 1168).
EXCEPTION: When the only feasible remedy is
indemnification for the damages caused by
reason that:
a. It has become impossible to undo the thing
physically or legally; or
b. If the act is definite and will not cease even if
undone.
ACTION FOR DAMAGES
Those who in the performance of their obligations are
guilty of fraud, negligence, or delay, and those who in
any manner contravene the tenor thereof, are liable
for damages (CIVIL CODE, Art. 1170).
One injured by a breach of a contract, or by a
wrongful or negligent act or omission shall have a fair
and just compensation commensurate to the loss
sustained as a consequence of the defendant’s act
(Llorente, Jr. v. Sandiganbayan, G.R. No. 122166,
March 11, 1998).
ACTION FOR RESCISSION
The power to rescind obligations is implied in
reciprocal obligations, in case one of the obligors
should not comply with what is incumbent upon him
(CIVIL CODE, Art. 1191, par. 1).
NOTE: This applies in case of a tacit resolutory
condition.
The injured party may choose between fulfillment and
rescission of the obligation, with the payment of
damages in either case.
Should he choose fulfillment and the same should
become impossible, the injured party may still seek
for rescission.
The court shall decree the rescission claimed unless
there be a just cause authorizing the fixing of the
period (CIVIL CODE, Art. 1191).
Requisites of Action for Rescission under Art.
1191: (ReF-SuC)
1. The parties are Reciprocally obligated;
2. One of the parties Failed to comply with what is
incumbent upon him;
3. The breach is Substantial so as to defeat the
object of the parties in making the agreement;
4. The injured party Chose the remedy of rescission
instead of enforcement, or had no other remedy
because enforcement became impossible.
NOTE: Art. 1191 is taken from Art. 1124 of the Old
Civil Code, but the present Code uses the term
rescission instead of resolution. Nevertheless, the
Code uses the term synonymously.
SUBSIDIARY REMEDY
The term “subsidiary remedy” has been defined as
“the exhaustion of all remedies by the prejudiced
creditor to collect claims due him before rescission is
resorted to” (Siguan v. Lim, G.R. No. 134685,
November 19, 1999).
Rescission is not a principal remedy, but a subsidiary
one. It can only be availed of only if the injured party
proves that he has no other legal means to obtain
redress for the damage caused. (CIVIL CODE, Art.
1191, par. 1)
REMEDIES OF CREDITOR UNDER
ARTICLE 1177: (SPA2)
1. Primary Remedies
a. Specific performance, or the exact fulfillment
of the obligation with the right to damages;
b. Pursue the leviable, or to purse the property
in possession of the debtor which are not
exempt from attachment under the law;
2. Subsidiary Remedies
a. Accion Subrogatoria
b. Accion Pauliana
Pursuing the Leviable Property or Property in
Possession of the Debtor
To exhaust the property in possession of the debtor
generally by attachment, subject to exemptions
provided by law (4 PARAS, supra at 183).
NOTE: The debtor is liable with all his property,
present and future, for the fulfillment of his obligations
subject to exemptions provided by law (CIVIL CODE,
Art. 2236).
The exemptions referred to are found in:
1. Sec. 13 Rule 39 of the New Rules of Court,
2. Sec. 118 and 13 of the Public Land Law (Com.
Act No. 141), and
3. Arts. 152, 153, 154, 155, and 205 of the Family
Code.
ACCION SUBROGATORIA
(SUBROGATORY ACTION)
Action which the creditor may exercise all rights and
actions in place of the negligent debtor, except those
inherent in the person (like parental authority, right to
revoke donations on ground of ingratitude, hold
office, carry out an agency), in order to preserve or
recover for the patrimony of the debtor the product of
such action, and then obtain therefrom the
satisfaction of his own credit (4 PARAS, supra at
183).
Requisites: (IPE)
1. Debtor to whom a right of action properly pertains
must be Indebted to the creditor;
2. Creditor must be Prejudiced by the inaction or
failure of the debtor to proceed against the third
person; and
3. Creditor must have first pursued or Exhausted all
the properties of the debtor which are not
exempted for execution.
Illustration:
D is indebted to C for a sum of money in the amount
of P1M. After demand failed and a determination that
D no longer has sufficient leviable properties, C may
see if any third person may be indebted to D. If C
should find that T is indebted to D for P50, 000, and
that the debt is due and demandable, C has the right
of action to compel T to pay the P50,000 to him.
Exceptions to Accion Subrogatoria: (EP-HAS)
1. Inherent rights of the debtor, like:
a. Right to Existence;
b. Rights or relations of a Public character (like
positions in the government);
c. Rights of an Honorary character (like a
doctor’s degree, honoris causa);
d. Rights pertaining to the Affairs of the home
and the family (such as the personal rights of
husband and wife); and
e. The right to appear in court proceedings, like
the Settlement of an estate (4 PARAS, supra
at 180).
2. Only those who at the time of the donor’s death
have a right to the legitime and their successors-
in-interest may ask for the reduction or inofficious
donations (CIVIL CODE, Art. 772).
ACCION PAULIANA
Creditors have the right to impugn the acts which the
debtor may have done to defraud them (CIVIL CODE,
Art. 1177).
This provision must be read in relation to Article
1381(3) which provides that contracts executed in
fraud of creditors are rescissible.
It refers to the right available to the creditor by virtue
of which he can secure the rescission of any act of
the debtor which is in fraud and to the prejudice of his
rights as a creditor (JURADO, Obligations and
Contracts, supra at 105).
NOTE: Accion Pauliana is different from the
“rescission” contemplated under Art. 1191 of the
CIVIL CODE. The latter is a primary action and not
subsidiary (JURADO, Obligations and Contracts,
2010, supra at 105).
Requisites: (C-SOFA)
1. Plaintiff asking for rescission has Credit prior to
the alienation, although demandable later;
2. Debtor has made a Subsequent contract
conveying a patrimonial benefit to a third person;
3. Creditor has no Other legal remedy to satisfy its
claim, but would benefit by rescission of the
conveyance to the third person;
4. Act being impugned is Fraudulent; and
5. Third person who received the property
conveyed, if by onerous title, has been an
Accomplice in the fraud (Holcim Phils., Inc. v.
Losloso, G.R. No. 203871, January 15, 2014).
Accion Pauliana as Remedy of Last Resort
The action for rescission is but a subsidiary remedy
which cannot be instituted except when the party
suffering damage has no other legal means to obtain
reparation for the same (CIVIL CODE, Art. 1383).
An accion pauliana must be of last resort, availed of
only after the creditor has exhausted all the properties
of the debtor not exempt from execution or after all
other legal remedies have been exhausted and have
been proven futile (Metropolitan Bank and Trust
Company v. International Exchange Bank, G.R. No.
176008, August 10, 2011).
Presumptions of Fraud
The following are presumptions of fraud of creditors
provided under Art. 1387 of the CIVIL CODE:
1. Alienation of property by gratuitous title without
reserving sufficient property to pay debts prior to
donation; and
2. Alienation by onerous title when there is
judgment or attachment.
ACCION SUBROGATORIA V.
ACCION PAULIANA
ACCION ACCION PAULIANA
SUBROGATORIA
As to the Existence of Credit
Not essential that credit Credit must have
is prior to the acquisition existed before debtor's
of debtor’s right. fraudulent act.
As to the Creditor’s Intent to Defraud
Intent to defraud Intent to defraud
creditor is not required. creditor is required.
As to Prescription
No period of Action prescribes within
prescription. four (4) years from the
discovery of the fraud.
(JURADO, Obligations and Contracts, supra at 104-
105).
NOTE: New debts contracted by an insolvent debtor
are not included within the scope of accion pauliana
because only acts which impair the assets of the
debtor are covered by the provision and those which
merely increase his liabilities are not (4 TOLENTINO,
supra at 140).
ACCION DIRECTA
A person may directly sue another even if there is no
privity of contract between them (CIVIL CODE, Arts.
1652, 1608, 1729, 1893).
Specific cases include the following:
1. In case of SUBLEASE, the sublessee is
subsidiarily liable to the lessor for any rent due
from the lessee. However, the sublessee shall
not be responsible beyond the amount of rent due
from him, in accordance with the terms of the
sublease, at the time of the extrajudicial demand
by the lessor.
NOTE: Payments of rent in advance by the
sublessee shall be deemed NOT to have been
made, so far as the lessor's claim is concerned,
unless said payments were effected in virtue of
the custom of the place (CIVIL CODE, Art. 1652).
2. In case of CONVENTIONAL REDEMPTION, the
vendor may bring his action against every
possessor whose right is derived from the
vendee, even if in the second contract no mention
should have been made of the right to
repurchase, without prejudice to the provisions of
the Mortgage Law and the Land Registration Law
with respect to third persons (CIVIL CODE, Art.
1608).
3. In case of a CONTRACT FOR A PIECE OF
WORK, subject to the provisions of special laws,
those who put their labor upon or furnish
materials for a piece of work undertaken by the
contractor have an action against the owner up to
the amount owing from the latter to the contractor
at the time the claim is made. However, the
following shall not prejudice the laborers,
employees and furnishers of materials:
a. Payments made by the owner to the
contractor before they are due;
b. Renunciation by the contractor of any
amount due him from the owner (CIVIL
CODE, Art. 1729); and
4. In case of SUB-AGENCY under Art. 1892, the
principal may bring an action against the
substitute with respect to the obligations which
the latter has contracted under the substitution
(CIVIL CODE, Art. 1893).
TRANSMISSIBILITY OF CREDITS
GENERAL RULE: Rights acquired by virtue of an
obligation are transmissible in character (CIVIL
CODE, Art. 1178).
Consequently, they may be alienated or assigned to
third persons (JURADO, Obligations and Contracts,
supra at 105).
EXCEPTIONS: (LaNS)
1. Where they are not transmissible by operation of
Law;
2. Where they are not transmissible by their very
Nature, such as in the case of a purely personal
right; and
3. Where there is a Stipulation of the parties that
they are not transmissible (CIVIL CODE, Arts.
1178 & 1311).
OTHER PRINCIPLES OF
OBLIGATIONS
USURIOUS INTERESTS
USURY
Contracting for or receiving interest in excess of the
amount allowed by law for the loan or forbearance of
money – the taking of more interest for the use of
money than the law allows (Tolentino v. SyChiam,
G.R. No. 26085, August 12, 1927).
USURIOUS TRANSACTIONS
Usurious transactions shall be governed by special
laws (CIVIL CODE, Art. 1175).
The special law governing usury is Act No. 2655, as
amended, or the Usury Law. However, there is
currently no “legally usurious rate.” This is because
pursuant to Section 1 of the Usury Law, the Monetary
Board of the Bangko Sentral has the power to
prescribe the ceiling interest rates. Then under C.B.
Circular No. 905, the BSP lifted the ceiling rates.
Be that as it may, the Supreme Court has struck down
“usurious” rates for being unconscionable and
contrary to morals (Medel v. Court of Appeals, G.R.
No. 131622, November 27, 1998).
(See Discussion on Simple Loan or Mutuum under
Loan and Deposit)
PRESUMPTIONS OF PAYMENT
1. Presumption when there is a receipt of
the principal by the creditor
The receipt of the principal by the creditor,
without reservation with respect to the interest,
shall give rise to the presumption that said
interest has been paid (CIVIL CODE, Art. 1176,
par. 1).
2. Presumption when there is a receipt of a
later installment of a debt
The receipt of a later installment of a debt without
reservation as to prior installments, shall likewise
raise the presumption that such installment has
been paid (CIVIL CODE, Art. 1176, par. 2).
NOTE: The presumption established in this
article is prima facie. The presumption that the
interest has been paid is based on the
consideration that as payments are first applied
to the interest (CIVIL CODE, Art. 1253), the
receipt of the principal must have taken place
because the interest had already been paid.
INSTANCES WHEN PRESUMPTIONS IN
ART. 1176 OF THE CIVIL CODE DO NOT
APPLY:
1. When there is a reservation as to interest or prior
installments, made orally or in writing;
2. Receipt for a part of principal
3. If the receipt does not recite that it was issued for
a particular installment due as when the receipt
is only dated;
4. In payment of taxes; and
5. Where non-payment of the prior obligations has
been proven (DE LEON, Obligations and
Contracts, supra at 97).
DIFFERENT KINDS OF
OBLIGATIONS
(ARTS. 1179-1230)
CLASSIFICATION OF OBLIGATION
1. As to the primary classification under the
CIVIL CODE:
a. Pure and conditional (CIVIL CODE, Arts.
1179-1192);
b. Obligations with a period (CIVIL CODE, Arts.
1193-1198);
c. Alternative and facultative (CIVIL CODE,
Arts. 1199-1206);
d. Joint and solidary (CIVIL CODE, Arts. 1207-
1222);
 e. Divisible and indivisible (CIVIL CODE, Arts.
1223-1225); and
f. With a penal clause (CIVIL CODE, Arts.
1226-1230).
2. Classification of a secondary character
under the CIVIL CODE:
a. Legal, conventional, and penal (CIVIL
CODE, Arts. 1158-1162);
b. Real and personal (CIVIL CODE, Arts. 1163-
1168);
c. Determinate and generic (CIVIL CODE, Arts.
1163-1166);
d. Positive and negative (CIVIL CODE, Arts.
1167-1168);
e. Unilateral and bilateral (CIVIL CODE, Arts.
1169-1191);
f. Individual and collective (CIVIL CODE, Arts.
1207, 1223); and
g. Accessory and principal (CIVIL CODE, Arts.
1166, 1226).
3. Other Classifications
a. By their juridical quality and efficaciousness
i. Natural – the obligation is based on
equity and natural law;
ii. Civil – the obligation is in accordance
with positive law; and
iii. Mixed – the obligation is in accordance
with both natural and positive law.
b. By its relation to other obligations
i. Principal – when it is the main
undertaking; or
ii. Accessory – when it is merely an
undertaking to guarantee the fulfillment
of the principal obligation.
c. By the object of the obligation to deliver
i. Specific
ii. Generic
d. By the Number of Prestations
i. Simple – when there is only one
undertaking;
ii. Compound – when there are several
undertakings.
1.) Conjunctive - when all the
undertakings are demandable at the
same time; or
2.) Distributive - when only one
undertaking out of several is
demandable.
a.) May be Alternative or Facultative
PURE AND
CONDITIONAL
OBLIGATIONS
(ARTS. 1179-1192)
PURE OBLIGATIONS
Obligations whose performance do not depend upon
a future or uncertain event or upon a past event
unknown to the parties are demandable at once
(CIVIL CODE, Art. 1179, par. 1).
Obligations which contain no terms or conditions
whatever upon which depends the fulfillment of the
obligation contracted by the obligor (4 TOLENTINO,
supra at 143).
WHEN IS AN OBLIGATION
DEMANDABLE AT ONCE:
An obligation is demandable at once
1. When it is pure (CIVIL CODE, Art. 1179, par. 1);
2. When it is subject to a resolutory condition (CIVIL
CODE, Art. 1179 par. 2); or
3. When it is subject to a resolutory period (CIVIL
CODE, Art. 1193, par. 2).
Examples:
1. I promise to pay you P1million.
2. I’ll pay you P1million on demand.
CONDITIONAL OBLIGATIONS
Obligations in which the acquisition of rights as well
as the extinguishment or loss of those already
acquired, shall depend upon the happening of the
event which constitutes the condition (CIVIL CODE,
Art. 1181).
CONDITION
A condition may be defined as a future and uncertain
fact or event upon which an obligation is subordinated
or made to depend (JURADO, Obligations and
Contracts, supra at 108).
CONDITION MUST BE A FUTURE OR
UNCERTAIN FACT
GENERAL RULE: In order to constitute an event a
condition, it is not enough that it be future; it must also
be uncertain (DE LEON, Obligations and Contracts,
supra at 106).
A future but certain fact or event is merely a term
rather than a condition.
EXCEPTION: When the debtor binds himself to pay
when his means permit him to do so, the obligation
shall be deemed to be one with a period (CIVIL
CODE, Art. 1180).
NOTE: Past but Unknown Event
A condition may refer to a past event provided that
the happening of such fact is unknown to the parties.
The element of uncertainty, however is wanting when
the event is past or present, hence it cannot properly
be called a condition. It is more accurate to designate
it as a basis of a contract. It cannot have the quality
of suspending the effects of a juridical act. The
uncertainty exists only in the minds of the parties, but
not the event itself. What can be a condition is the
future knowledge or proof of an unknown to the
parties, but not the event itself. Thus, the PROOF of
an unknown past event may, by the will of the parties,
be established as a condition (4 TOLENTINO, supra
at 145).
A condition is really “a future AND uncertain event,”
not a “future OR uncertain event.” (J.B.L. Reyes,
Observation on the New Civil Code, Lawyer’s
Journal, January 31, 1951, pp. 47).
Example: A person promises to deliver P5,000 “if the
number of enemy soldiers killed during the World War
II exceeds 1,000.
In the above example, it is not the fact stated which
serves as a condition, but the proof of such fact, the
contract or obligation arises, not when the event
happened or the fact came into existence, which
would be in the past, but when the proof of such fact
or event is presented, which would be in the future.
CLASSIFICATIONS OF CONDITIONS:
1. As to the Effect of Obligation
a. Suspensive – when the fulfillment of the
condition results in the acquisition of rights
arising out of the obligation (CIVIL CODE,
Art. 1181);
b. Resolutory – when the fulfillment of the
condition results in extinguishment of rights
arising out of the obligation (CIVIL CODE,
Art. 1181).
2. As to the Dependence on the Will of the
Parties
a. Potestative – one which depends upon the
will of one of the contracting parties; it is in
the power of one of the parties to realize or
to prevent;
b. Casual – depends exclusively upon chance,
will of a third person, or partially by chance
and partially by will of a third person, or other
factors and not upon the will of the
contracting parties; and
c. Mixed – depends upon the will of one of the
contracting parties and other circumstances,
including the will of third persons or chance.
3. As to Possibility
a. Possible – when the condition is capable of
realization according to nature, law, public
policy or good customs; and
b. Impossible – when the condition is not
capable of realization according to nature
(physical) law, public policy, morals or good
customs (legal).
4. As to Mode
a. Positive – condition that some event happen
at a determinate time shall extinguish the
obligation as soon as the time expires or
become indubitable that the event will not
take place (CIVIL CODE, Art. 1184); and
b. Negative – the condition that some event will
not happen at a determinate time shall render
the obligation effective from the moment the
time has elapsed of it has become evident
that the event cannot occur (CIVIL CODE,
Art. 1185, par. 1).
5. As to Divisibility
a. Divisible – when the condition is susceptible
of partial realization; and
b. Indivisible – when the condition is not
susceptible of partial realization (CIVIL
CODE, Art. 1225, par. 1).
6. As to Plurality of Conditions
a. Conjunctive – there are several conditions,
which must all be realized; and
b. Alternative – there are several, but only one
must be realized.
7. As to Form
a. Express – condition is stated expressly
b. Implied – condition is stated tacitly
(JURADO, Obligations and Contracts, supra
at 110).
SUSPENSIVE OR RESOLUTORY
CONDITIONS
SUSPENSIVE CONDITION
A suspensive condition (condition precedent) is a
future and uncertain event upon the happening or
fulfillment of which rights arising out of the obligation
are acquired.
If the suspensive condition does not take place, the
parties would stand as if the conditional obligation
had never existed (The Insular Life Assurance Co.,
Ltd. v. Toyota Bel-Air, Inc., G.R. No. 137884, March
28, 2008).
Where an obligation is subject to a suspensive
condition, upon constitution of obligation, and before
fulfillment of the condition, the obligee acquires a
mere hope or expectancy, protected by law
(JURADO, Obligations and Contracts, supra at 111).
EFFECT OF FULFILMENT OF
SUSPENSIVE CONDITION
1. Before fulfillment
– Demandability and the acquisition of the rights
arising from the obligation is suspended.
Obligation of obligor to comply with the prestation
is suspended until fulfillment of condition.
Anything paid by mistake during such time may
be recovered.
2. After the fulfillment
– The obligation arises or becomes effective;
obligor can be compelled to comply with what is
incumbent upon him.
Hence, an obligation dependent upon a suspensive
condition cannot be demanded until after the
condition takes place because it is only after the
fulfillment of the condition that the obligation arises
(Catungal v. Rodriguez, G.R. No. 146839, March 23,
2011).
NATURE OF CREDITOR’S RIGHT
BEFORE FULFILLMENT OF
SUSPENSIVE CONDITION
The creditor merely has an interest in the object of the
obligation under a suspensive condition. It is an
inchoate right (mere expectancy). However, the
creditor may, before the fulfilment of the condition,
bring the appropriate actions for the preservation of
his right (CIVIL CODE, Art. 1188).
Illustration:
D owes C a sum of money in the amount of P1M
under the condition that D will pay it only when C
passes the 2021 Bar Examinations. However, on
September 2021, it became clear that D was
alienating all of his properties in the Philippines and
was preparing to abscond. C may bring an action in
court to enjoin D from alienating his property to the
extent of P1M and that it be held under a trusteeship
until it becomes certain that C will or will not pass the
bar in May 2022.
RESOLUTORY CONDITION
A resolutory condition (condition subsequent) is a
future and uncertain event upon the happening or
fulfillment of which rights which are already acquired
by virtue of the obligation are extinguished or lost
(JURADO, Obligations and Contracts, supra at 111).
Parties may validly provide for resolutory conditions
and unilateral rescission in their contract
(Multinational Village Homeowners Association Inc.
v. Ara Security & Surveillance Agency, Inc., G.R. No.
154852, October 21, 2004).
Thus, when a person donates land to another on the
condition that the latter would build upon the land a
school, the condition imposed was not a condition
precedent or a suspensive condition but a resolutory
one (Central Philippines University v. Court of
Appeals, G.R. No. 112127, July 17, 1995).
EFFECT OF FULFILMENT OF
RESOLUTORY CONDITION
1. Before fulfillment
– all rights under the obligation are acquired as if
it were a pure obligation except that such rights
are always subject to the threat or danger of
extinction.
2. After fulfillment
– The obligation is extinguished and is as if it
never existed.
Whatever may have been paid or delivered
by one or both of the parties (in case of real
obligations) shall have to be returned upon
the fulfillment of the condition (CIVIL CODE,
Art. 1190).
POTESTATIVE CONDITIONS
POTESTATIVE CONDITION
A potestative condition is a condition suspensive in
nature and which depends upon the will of one of the
contracting parties (Virginia A. Perez v. Court of
Appeals, G.R. No. 112329, January 28, 2000).
EFFECTS OF POTESTATIVE
CONDITIONS
1. In suspensive conditions, if fulfillment of the
condition depends exclusively upon the will of the
creditor – Condition and Obligation are VALID.
REASON: The creditor is naturally interested in
the fulfillment of the condition since it is only by
such fulfillment that the obligation can be
effective.
2. In suspensive conditions, if fulfillment of the
condition depends exclusively upon the will of the
debtor – Condition and Obligation are VOID.
REASON: Prohibition against potestative
conditions inferred from Art. 1182 extends only to
those which are potestative to the debtor. To
allow this is equivalent to sanctioning obligations
which are illusory. It would also be in
contravention with Art. 1308 which provides that
the validity and fulfillment of contracts cannot be
left to the will of one of the contracting parties.
EXCEPTIONS:
a. In resolutory conditions, if fulfillment of the
condition depends exclusively upon the will
 of the debtor– Condition and Obligation are
VALID.
REASON: The debtor is interested in the
fulfillment of the resolutory condition since it
is only by such fulfillment that he can
reacquire the right which have already been
vested in the obligee or creditor upon the
constitution of the obligation.
b. Potestative conditions in pre-existing
obligations, Obligation is still VALID
(JURADO, Obligations and Contracts, supra
at 115-122).
If the obligation is a pre-existing one, and,
therefore, does not depend for its existence
upon the fulfillment by the debtor of the
potestative condition, only the condition is
void leaving unaffected the obligation itself.
Here, the condition is imposed not on the
birth of the obligation but on its fulfillment
(Catungal v. Rodriguez, G.R. No. 146839,
March 23, 2011).
Example: D borrowed P10,000 from C
payable within two (2) months.
Subsequently, D promised to pay C “after D
sells his car” to which C agreed. In this case,
only the condition is void but not the pre-
existing obligation of D to pay C (DE LEON,
Obligations and Contracts, supra at 127).
Examples of Void Potestative Conditions:
1. “I will pay you if I want.”
2. “I will pay you after I recover what D owes me.”
3. The contract of lease provides that the lease shall
continue “for as long as the lessee needed the
premises and can meet and pay the 20%
increase every three years” (Lao Lim v. CA, G.R.
No. 87047, October 31, 1990; DE LEON,
Obligations and Contracts, supra at 121-122).
CASUAL CONDITION
One whose fulfillment depends exclusively upon
chance and/or will upon the will of a third person (Id.
at 115).
Effect of Casual conditions
The obligation including such condition shall take
effect (Id. at 118).
MIXED CONDITION
One whose fulfillment depends jointly upon the will of
either one of the parties to the obligation and upon
chance and/or will of a third person (Id. at 115).
Effect of Mixed conditions
The obligation including such condition shall take
effect (Id. at 118).
Example: Where the debtor promises to pay his
debts to the creditor as soon as he shall have
received funds derived from the sale of his house, it
was held that the fulfillment of the condition depends
partly upon the will of the debtor and partly upon the
will of third persons, as a consequence of which it is
perfectly valid and enforceable (Hermosa v.
Longara, G.R. No. L-5267, October 27, 1953).
Constructive Fulfillment of a MIXED Conditional
Obligation
The existing rule in mixed conditional obligation is
that when the condition was not fulfilled but the
obligor did all in his power to comply with the
obligation, the condition should be deemed satisfied
(International Hotel Corporation v. Francisco B.
Joaquin Jr., G.R. No. 158361, April 10, 2013).
IMPOSSIBLE CONDITIONS
IMPOSIBILITY
It is impossible when it is not capable of realization
either according to its nature or according to law,
good customs or public policy (JURADO, Obligations
and Contracts, supra at 122-123).
Impossible Conditions are Void
The condition not to do an impossible thing shall be
considered as not having been agreed upon (CIVIL
CODE, Art. 1183; Heirs of Severina San Miguel v.
The Honorable Court of Appeals, G.R. No. 136054,
September 5, 2001).
Impossible conditions, those contrary to good
customs or public policy and those prohibited by law
shall annul the obligation which depends upon them.
If the obligation is divisible, that part thereof which is
not affected by the impossible or unlawful condition
shall be valid (CIVIL CODE, Art. 1183).
EFFECTS OF IMPOSSIBLE CONDITIONS:
1. If the condition is to do an impossible or illegal
thing, both obligation and condition are void (4
PARAS, supra at 204).
REASON: Obligor knows his obligation cannot
be fulfilled; he has no intention to comply with his
obligation (DE LEON, Obligations and Contracts,
supra at 135).
2. If the condition is negative, that is, not to do the
impossible, it is disregarded and obligation is
rendered pure and valid (Id. at 135; CIVIL CODE,
Art. 1183).
3. Only the affected obligation is void – if the
obligation is divisible, the part not affected by the
impossible condition shall be valid (Luneta Motor
Co. v. Abad, G.R. No. L-45273, April 10, 1939).
4. Only the condition is void – if obligation is pre- a. Before July 1, 2022, the Filipino people
existing, not depending on fulfillment of the ratifies an amendment to the constitution, or
condition which is impossible for its existence, ratifies a new constitution.
only the condition is void (JURADO, Obligations Note: It is certain that the negative condition
and Contracts, supra at 123). will never be fulfilled.
5. Condition considered not imposed – if
impossible/unlawful condition is attached to a CONSTRUCTIVE FULFILLMENT
simple or remuneratory donation as well as to a
testamentary disposition, condition is considered
not imposed while the obligation is valid (CIVIL
DOCTRINE OF CONSTRUCTIVE
CODE, Art. 1183). FULFILLMENT OF SUSPENSIVE
CONDITIONS
MODE OF CONDITIONS The condition shall be deemed fulfilled when the
obligor voluntarily prevents its fulfillment (CIVIL
POSITIVE VS. NEGATIVE CONDITION CODE, Art. 1186).

POSITIVE NEGATIVE REASON: The debtor should not be allowed to profit

from his own fault or bad faith to the prejudice of the
As to the Mode of Performance obligee (DE LEON, Obligations and Contracts, supra
at 138).
Involves the Involves the
performance of an act nonperformance of an
Requisites:
or the fulfillment of an act or the nonfulfillment
1. The intent of the obligor to prevent the fulfillment
event. of an event up within a
of the condition; and
certain period of time.
2. The actual prevention of the fulfillment
As to How Fulfilled (International Hotel Corporation v. Francisco B.
Joaquin, G.R. No. 158361, April 10, 2013).
Fulfilled upon the Fulfilled from the moment
happening of the act or 1. the time indicated Mere intention of the debtor to prevent the happening
event. has lapsed; or of the condition, or to place ineffective obstacles to its
2. it has become compliance, without actually preventing the
evident that the fulfillment, is insufficient (International Hotel
event cannot occur, Corporation v. Joaquin, Jr., G.R. No. 158361, April
although the time 10, 2013).
indicated has not yet
lapsed (CIVIL Applicable to Suspensive Conditions Only
CODE, Art. 1185). Doctrine applies only to suspensive condition, not to
resolutory conditions. It can have no application to an
As to How Extinguished external contingency which is lawfully within the
control of the obligor (Taylor v. Uy Tieng Piao, G.R.
Extinguished when the Extinguished when the No. L-16109, October 2, 1922).
impossibility of the act act or event occurs at
or event ever any time before the time Article 1186 of the New Civil Code provides that "[t]he
happening becomes indicated has lapsed. condition shall be deemed fulfilled when the obligor
absolutely certain voluntarily prevents its fulfillment.” Here, the Court of
(CIVIL CODE, Art. Appeals detailed the efforts made by respondent
1184). Luwalhati and consignee Sison. It also noted
petitioner's ambiguous and evasive responses,
Illustration of Negative Condition nonchalant handling of respondents' concerns, and
“If the Philippine Constitution is not amended by the how these bogged down respondents' actions and
end of President Duterte’s term.” impaired their compliance with the required 45-day
1. It is fulfilled when: period (Federal Express Corp. v. Antonino, G.R. No.
a. On July 1, 2022, the Philippines has not 199455, June 27, 2018).
ratified any amendment to the constitution or
a new constitution. RETROACTIVE EFFECT OF
b. It has become certain that it is impossible to FULFILLMENT OF SUSPENSIVE
hold a ratification plebiscite to ratify any CONDITION
submitted amendments or a new constitution
before July 1, 2022.
2. It is extinguished when:
PRINCIPLE OF RETROACTIVITY OF
EFFECT IN SUSPENSIVE CONDITION
The effects of a conditional obligation to give, once
the condition has been fulfilled, shall retroact to the
day of the constitution of the obligation (CIVIL CODE,
Art. 1187).
RULE ON RETROACTIVITY HAS NO
APPLICATION TO: (RS)
1. Real contracts (e.g. deposit or commodatum)
because they are perfected only by delivery of the
object of the obligation. The principle only applies
to consensual contracts; and
2. Contracts in which the obligation arising
therefrom can only be realized within Successive
periods or intervals (e.g. lease, hire of service, life
annuity) (JURADO, Obligations and Contracts,
supra at 129).
RETROACTIVE EFFECT AS TO THE
FRUITS AND INTERESTS
1. Obligations to Give:
a. In Reciprocal Obligations: no retroactivity –
deemed mutually compensated during the
pendency of the condition (fruits may be
natural, industrial or civil) (CIVIL CODE, Arts.
441-442 and 1187).
b. In Unilateral Obligations: no retroactivity –
debtor shall appropriate the fruits and
interests received unless the intention was
otherwise, as inferred from nature and
circumstances (JURADO, Obligations and
Contracts, supra at 129-130).
2. Obligations to Do or Not to Do
The courts will have to determine in each case
the retroactive effect of the condition that has
been complied with. This duty of the courts
includes the power to determine whether the
effects of the fulfillment of the condition shall
retroact to the very moment of the constitution of
the obligation or only to a specified date before
fulfillment. It can even include the power to
determine whether or not there will be any
retroactivity of effects (8 MANRESA, 5th Ed., Bk.
1, p. 335).
NOTE: This rule also applies to an obligation with
a resolutory condition (CIVIL CODE, Art. 1190,
par. 3).
RIGHTS OF THE CREDITOR BEFORE
THE FULFILLMENT OF THE CONDITION
The creditor, may, before the fulfillment of the
obligation, bring the appropriate action for the
preservation of his right (CIVIL CODE, Art. 1188).
NOTE: The law says “preservation,” not “preference”
over other creditor (Jacinto v. de Leon, G.R. No. L-
26635, May 3, 1927).
RIGHTS PENDING FULFILLMENT OF
SUSPENSIVE CONDITION:
1. Rights of creditor
– The right of the creditor, which, before the
fulfillment of the condition, was a mere hope or
expectancy, is perfected, becomes effective and
demandable. The creditor may compel the debtor
to comply with what is incumbent upon him (DE
LEON, Obligations and Contracts, supra at 144).
2. Rights of debtor
– He is entitled to recover what he has paid by
mistake prior to the happening of the suspensive
condition.
REASON: This is a case of solutio indebiti where
there is payment before any legal right to receive
payment exists.
NOTE: Payment before the fulfillment of the
condition must be “by mistake;” otherwise, the
debtor is deemed to have impliedly waived the
benefit of the suspensive condition.
LOSS, DETERIORATION OR
IMPROVEMENT DURING THE
PENDENCY OF THE CONDITION
Requisites for Application of Art. 1189: (RSS-FP)
1. The obligation is a Real obligation;
2. The object is a Specific or determinate thing;
3. The obligation is subject to a Suspensive
condition;
4. The condition is Fulfilled; and
5. There is loss, deterioration, or improvement of
the thing during the Pendency of the happening
on one condition (DE LEON, Obligations and
Contracts, supra at 147).
LOSS
A thing is lost when it: (DPG)
1. Disappears in such a way that its existence is
unknown or it cannot be recovered (i.e., a thing is
stolen by unknown persons);
2. Perishes (i.e., a house is destroyed completely
by fire); and
3. Goes out of the commerce of men (i.e. a thing is
declared by law as contraband) (CIVIL CODE,
Art. 1189, par. 2).
DETERIORATION
Any reduction or impairment in the substance or
value of a thing which does not amount to loss; the
thing is less than its value when the obligation was
constituted (4 TOLENTINO, supra at 170 -171).

IMPROVEMENT
A thing is improved when its value is increased or
enhanced by nature or by time or at the expense of
the debtor or creditor (DE LEON, Obligations and
Contracts, supra at 148).
RULES ON LOSS OR CHANGE IN VALUE
OF OBJECT OF REAL OBLIGATION
BEFORE FULFILLMENT OF
SUSPENSIVE CONDITION
1. Loss
a. Debtor at fault – debtor liable to pay
Damages.
b. Debtor without fault – obligation to deliver
extinguished (CIVIL CODE, Art. 1189(1)-(2)).
2. Deterioration
a. Debtor at fault – creditor may enforce:
i. Payment of damages; and
ii. Either:
1.) Rescission of contract
2.) Specific Performance
b. Debtor without fault – obligation to deliver
extinguished (CIVIL CODE, Art. 1189(3)-(4)).
3. Improvements
a. Expense of Debtor – debtor has rights of
usufructuary with respect to improvements.
b. Without Debtor’s Expense – any increase in
value inures to the creditor (CIVIL CODE, Art.
1189(5)-(6)).
RIGHTS OF USUFRUCTUARY ON
IMPROVEMENTS
1. No right to reimbursement of value;
2. Right to remove said improvements if removal is
possible without damage to the property ;
3. Right to set off improvements with any damage
caused to the property without his fault (CIVIL
CODE, Arts. 579 & 580).
RULES ON LOSS APPLIES TO
OBLIGATION TO DELIVER AFTER
RESOLUTORY CONDITION
When the conditions have for their purpose the
extinguishment of an obligation to give, the parties,
upon the fulfillment of said conditions, shall return to
each other what they have received.
In case of the loss, deterioration or improvement of
the thing, the provisions which, with respect to the
debtor, are laid down in the preceding article shall be
applied to the party who is bound to return (CIVIL
CODE, Art. 1190).
RECIPROCAL OBLIGATIONS
Those which arise from the same cause and in which
each party is a debtor and creditor of the other, such
that the performance of one is designed to be the
equivalent and the condition for the performance of
the other (DE LEON, Obligations and Contracts,
supra at 152).
Example: Contract of Absolute Sale where Seller is
bound to deliver the thing sold in consideration of the
price while the Buyer is bound to deliver the price in
consideration of the thing sold.
Not All Bilateral Obligations are Reciprocal
X, Y’s aging mother, undertakes to deliver a gift to Y
in consideration of her love and affection. Y
undertakes to continue supporting X in consideration
of Y’s duty to support X. In such case, although X and
Y are mutually bound to each other, their obligations
are not reciprocal as they do not arise from the same
causes.
CONCEPT OF TACIT RESOLUTORY
CONDITION
Neither party incurs delay if the other does not comply
or is not ready to comply in a proper manner with what
is incumbent upon him (CIVIL CODE, Art. 1169, par.
3). Until either one fulfills his obligation, neither is
deemed in delay. To avoid delay on any of the two
parties, they must comply with their obligations
simultaneously. Effectively, the performance of each
party is a suspensive condition to the obligation of the
other.
It is tacit because it is implied in all reciprocal
obligation; conditional because not being able to
perform the obligation incumbent upon the party is
the event; and resolutory because it results to the
extinguishment of the obligation of the debtor and
creditor.
Conversely, the non-performance of one party is a
tacit resolutory condition as to the obligation of the
other. In other words, if X does not fulfill his obligation,
such non-performance may be treated as
extinguishing Y’s obligation, as if it were a resolutory
condition on Y’s obligation.
EFFECT OF FULFILLMENT OF TACIT
RESOLUTORY CONDITION
If one of the parties fails to comply with what is
incumbent upon him, there is a right on the part of the
other to rescind (or resolve) the obligation (CIVIL
CODE, Art. 1191).
The injured party may choose between the fulfillment
and the rescission of the obligation, with the payment
of damages in either case. He may also seek
rescission, even after he has chosen fulfillment, if the
latter should become impossible (CIVIL CODE, Art.
1191).
ACTION FOR “RESCISSION” OF
CONTRACT
More accurately referred to as resolution, the right of
rescission under Article 1191 is predicated on a
breach of faith that violates the reciprocity between
parties to the contract. This retaliatory remedy is
given to the contracting party who suffers the
injurious breach on the premise that it is “unjust that
a party be held bound to fulfill his promises when the
other violates his” (Golden Valley Exploration, Inc. v.
Pinkian Mining Company, G.R. No. 190080, June 11,
2014).
It can be demanded only if the plaintiff is ready,
willing, and able to comply with his own obligation and
the other is not (Seva v. Berwin, G.R. No. L-24321,
January 11. 1926), and the party who has not
performed his part of the agreement is not entitled to
sue or rescind (Sps. Cannu v. Sps. Galang, G.R. No.
139523, May 26, 2005).
It is a right which belongs to the injured party alone
(Mateos v. Lopez, G.R. No. 2391, April 28, 1906;
Universal Food Corporation v. Cam G.R. No. L-
29155, May 13, 1970). Under the rule of exceptio non
adimpleti contractus, the party who has not
performed his part of the agreement is not entitled to
sue (Marin v. Adil, G.R. No. L-47986, July 16, 1984).
REQUISITES OF ACTION OF
RESCISSION UNDER ART. 1191:
(ReF-SuC)
1. The parties are Reciprocally obligated.
2. One of the parties Failed to comply with what is
incumbent upon him;
3. The breach is Substantial so as to defeat the
object of the parties in making the agreement;
and
4. The injured party Chose the remedy of rescission
instead of enforcement, or had no other remedy
because enforcement became impossible.
SUBSTANTIAL BREACH REQUIRED
For a contracting party to be entitled to rescission (or
resolution) in accordance with Article 1191 of the
CIVIL CODE, the other contracting party must be in
substantial breach of the terms and conditions of their
contract. A substantial breach of a contract, unlike
slight and casual breaches thereof, is a fundamental
breach that defeats the object of the parties in
entering into an agreement (Maglasang v.
Northwestern University, Inc., G.R. No. 188986,
March 20, 2013).
It will not be permitted for a slight or casual breach,
but only for such substantial and fundamental
violations as would defeat the very object of the
parties in making the agreement (Golden Valley
Exploration Inc. v. Pinkian Mining Company and
Copper Valley Inc., G.R. No. 190080, June 11, 2014;
Buenviaje v. Spouses Salonga, G.R. No. 216023,
October 5, 2016).
Mere failure of a party to comply with what is
incumbent upon him does not ipso jure produce the
rescission or resolution of the obligation (JURADO,
Obligations and Contracts, supra at 137).
DECLARATION OF RESCISSION
1. If the obligation has not yet been performed,
extrajudicial declaration by the party who is ready
and willing to perform is allowed.
2. If the obligation has already been performed by
the injured party:
a. If the other party does not oppose or
impugn the extrajudicial declaration, such
will produce legal effect.
b. If the other party opposes the rescission,
the injured party cannot by his own
declaration rescind the contract. Court
action, in this case, is necessary (4
TOLENTINO, supra at 178).
JUDICIAL PERMISSION TO RESOLVE
NECESSARY
GENERAL RULE: The power to rescind an obligation
must be invoked judicially and cannot be exercised
solely on a party’s own judgment that the other has
committed a breach of the obligation (Golden Valley
Exploration Inc. v. Pinkian Mining Company and
Copper Valley Inc., G.R. No. 190080, June 11, 2014).
EXCEPTION: Where parties agree to a stipulation
allowing extra-judicial rescission, no judicial decree is
necessary for rescission to take place; the extra-
judicial rescission immediately releases the party
from its obligation under the contract, subject only to
court reversal if found improper. On the other hand,
without a stipulation allowing extra-judicial rescission,
it is the judicial decree that rescinds, and not the will
of the rescinding party. This notwithstanding,
jurisprudence still indicates that an extra-judicial
rescission based on grounds not specified in the
contract would not preclude a party to treat the same
as rescinded. The rescinding party, however, by such
course of action, subjects himself to the risk of being
held liable for damages when the extra-judicial
rescission is questioned by the opposing party in
court (Golden Valley Exploration, Inc. v. Pinkian
Mining Co., G.R. No. 190080; June 11, 2014).
RESCISSION NOT A MATTER OF RIGHT
The court shall decree the rescission claimed, unless
there be just cause authorizing the fixing of a period
(CIVIL CODE, Art. 1191, par. 3).
ARTICLE 1191 DOES NOT PROHIBIT
STIPULATION FOR EXTRA-JUDICIAL
RESCISSION
Article 1191 of the CIVIL CODE did not prohibit the
parties from entering into an agreement whereby a
violation of the terms of the contract would result to
its cancellation (Calilap-Asmeron v. Development
Bank of the Philippines, G.R. No. 157330, November
23, 2011).
EFFECTS OF EXTRAJUDICIAL
RESCISSION
1. If there is a stipulation granting the right of
rescission on the part of the aggrieved party and
he validly rescinds the contract pursuant to such
express grant, any court decision adjudging the
propriety of the rescission extra-judicially made is
not the revocatory act of rescission but merely
declaratory or an affirmation of the revocation
(De Luna v. Abrigo, G.R. No. 57455, January 18,
1990).
2. The decree of rescission shall be without
prejudice to the rights of third persons who have
acquired the thing in accordance with Art. 1385
and 1388 and Mortgage Law (CIVIL CODE, Art.
1191, par. 4).
EFFECT OF RESCISSION
It requires restitution or bringing parties back to
original status prior to the contract (Unlad Resources
Dev. Corp., v. Dragon, G.R. No. 149338, July 28,
2008).
Mutual restitution, which entails the return of the
benefits that each party may have received as a
result of the contract, is thus required. To be sure, it
has been settled that the effects of rescission as
provided for in Article 1385 of the Code are equally
applicable to cases under Article 1191 (Gotesco
Properties v. Spouses Eugenio, G.R. No. 201167,
February 27, 2013).
NOTE: There can be partial rescission or fulfillment
under Art. 1191 of the CIVIL CODE (Central Bank of
the Philippines v. CA, G.R. No. L-45710, October 3,
1985).
EFFECTS OF BREACH BY BOTH
PARTIES:
1. The liability of the first infractor shall be equitably
tempered by the courts; and
2. If it cannot be determined which of the parties first
violated the contract, the same shall be deemed
extinguished, and each shall bear his own
damages (CIVIL CODE, Art. 1192).
OBLIGATIONS WITH A
PERIOD OR A TERM
(ARTS. 1193-1198)
OBLIGATIONS WITH A PERIOD
Obligations whose fulfillment a day certain has been
fixed, shall be demandable only when that day
comes. Obligations with a resolutory period take
effect at once but terminate upon the arrival of the day
certain.
A day certain is understood to be that which must
necessarily come, although it may not be known
when. If the uncertainty consists in whether the day
will come or not, the obligation is a conditional one
(CIVIL CODE, Art. 1193).
WHEN DEEMED TO BE WITH A PERIOD
When the debtor binds himself to pay when his
means permit him, the obligation shall be deemed to
be one with a period subject to the provisions of
Article 1197 which provides that the court shall also
fix the period when it depends upon the will of the
debtor (CIVIL CODE, Art. 1197 par. 2, CIVIL CODE
in relation to Art. 1180).
TERM/PERIOD
Interval of time, which, exerting an influence on an
obligation as a consequence of a juridical act, either
suspends its demandability or produces its
extinguishment (8 MANRESA, 5th Ed., Bk. 1, p. 370).
REQUISITES: (FCP)
1. Future;
2. Certain; and
3. Possible, legally and physically (JURADO, supra
at 149).
NOTE: When the period is too short for the
prestation, as when Atoy is to build a ten-story
building in twenty-four (24) hours, the obligation
is void (4 TOLENTINO, supra at 188).
KINDS OF PERIOD/TERM: (EFEX-DESO)
1. As to Effect
a. Suspensive (Ex Die) – Obligations whose
fulfillment a day certain has been fixed, shall
be demandable only when that day comes
(CIVIL CODE, Art. 1193, par. 1).
 b. Resolutory (In Diem) – Obligations with a agreed to set the time of payment at another time
resolutory period take effect at once but (JURADO, Obligations and Contracts, supra at 160).
terminate upon arrival of the day certain
(CIVIL CODE, Art. 1193, par 2). TERM/PERIOD V. CONDITION
2. As to Expression TERM/PERIOD CONDITION
a. Express – when specifically stated; and As to Requisites
b. Implied – when it can be deduced that the
parties intended a period, such as in the case Interval of time which is Fact or event which is
of Art. 1180 of the CIVIL CODE when one future and certain. future and uncertain.
promises to pay when able.
As to Fulfillment
3. As to Definiteness
a. Definite – refers to a fixed known date or Must necessarily come, May or may not happen.
time(CIVIL CODE, Art. 1193, par 3);and although it may not be
b. Indefinite – event which will necessarily known when.
happen but the date of its happening is
unknown. Where the period is not fixed but a As to Influence on Obligation
period is intended, the courts are empowered
Exerts an influence Exerts an influence upon
by law to fix the same (CIVIL CODE, Art.
upon the time of the very existence of the
1197).
demandability or obligation itself.
extinguishment of an
NOTE: The uncertainty of the date of occurrence
obligation.
does not convert into a condition so long as there
is no uncertainty whether the event will happen As to Retroactivity of Effects
or not (JURADO, Obligations and Contracts,
supra at 147). No retroactive effect Has retroactive effect.
unless there is an
4. As to Source agreement to the
a. Conventional – stipulated by parties (CIVIL contrary.
CODE, Art. 1196);
b. Legal – period fixed by law such as Arts. As to Effect of Will of Debtor
1682 and 1687; and
c. Judicial – fixed by courts, in case of implied When it is left When it is left exclusively
and indefinite period (JURADO, Obligations exclusively to the will of to the will of the debtor,
and Contracts, supra at 147-148). the debtor, the the very existence of the
existence of the obligation is affected.
EFFECT OF SUSPENSIVE TERM obligation is not
affected; empowers the
It is only from that date that it is due and demandable
court to fix the duration
(Ullman v. Hernaez, G.R. No. L-9816, March 10,
of the obligation.
1915).
(JURADO, Obligations and Contracts, supra at 147).
What is suspended by the term is not the acquisition
of the right or the effectivity of the obligation but its EFFECT OF LOSS, DETERIORATION, OR
demandability (JURADO, Obligations and Contracts, IMPROVEMENT BEFORE ARRIVAL OF
supra at 149).
PERIOD
WHERE DURATION OF PERIOD In case of loss, deterioration or improvement of the
thing before the arrival of the day certain, the same
DEPENDS UPON THE WILL OF DEBTOR rules under Art. 1189 of the CIVIL CODE shall be
Where the debtor promises to pay when his means observed (CIVIL CODE, Art. 1194).
permit him to do so, the obligation shall be deemed
to be one with a period (CIVIL CODE, Art. 1180). If a fortuitous event supervenes, the obligor is merely
relieved of the obligation to fulfill at that time and does
NOTE: What depends upon the debtor’s will is not not stop the running of the period because in effect
whether he should pay or not. What is left only to his that would be an extension of the term of the contract
will is the duration of the period. The term only (Victorias Planters Association, Inc., v. Victorias
suspends the demandability of the obligation and not Milling Co., G.R. No. L-6648, July 25, 1955).
its existence. It is a situation where the parties merely
EFFECT OF ADVANCE PAYMENT OR
DELIVERY
In obligations to give, the obligor can recover what he
has paid or delivered with fruits and interests (CIVIL
CODE, Art. 1195).
There can be no right of recovery if the obligor
delivers the thing voluntarily or with the knowledge of
the period or term or the fact that the obligation has
not yet become due and demandable (4
TOLENTINO, supra at 193).
NOTE: Article 1195 applies only to obligations to
give. It is similar to Article 1188, paragraph 2, which
allows the recovery of what has been paid by mistake
before the fulfillment of a suspensive condition. It has
no application to obligations to do or not to do (Id. At
196).
PARTIES PRESUMED AWARE OF
PERIOD
Whenever in an obligation a period is designated, it
is presumed to have been established for the benefit
of both the creditor and the debtor, unless it should
appear that the period has been established in favor
of one or of the other (CIVIL CODE, Art. 1196).
It is important to bear in mind that in a reciprocal
contract like a lease, the period of the lease must be
deemed to have been agreed upon for the benefit of
both parties, absent language showing that the term
was deliberately set for the benefit of the lessee or
lessor alone (LL and Company Development and
Agro-Industrial Corporation v. Huang Chao Chun,
G.R. No. 142378, March 7, 2002).
EFFECT OF PERFORMANCE BEFORE
TERM
Payment before the term and the acceptance of
payment by a creditor amounts to a waiver of the
period agreed upon during which payment should not
be made.
PERIOD FOR THE BENEFIT ONLY OF
THE CREDITOR
Creditor may demand the fulfillment of the obligation
at any time but the obligor cannot compel him to
accept payment before the expiration of period (DE
LEON, Obligations and Contracts, supra at 201).
PERIOD FOR THE BENEFIT ONLY OF
THE DEBTOR
Debtor cannot be compelled to perform obligation
prematurely, but he can do so if he desires (Id. at
200).
WHEN COURT MAY FIX DURATION OF
TERM
GENERAL RULE: Courts are without power to fix
period.
REASON: Freedom to Contract (CIVIL CODE, Art
1306)
EXCEPTIONS:
1. If the obligation does not fix a period, but from its
nature and circumstances it can be inferred that
a period was intended (CIVIL CODE, Art. 1197,
par. 1);
Effect of Lack of Definite Duration of Term
The fulfillment of the obligation cannot be
demanded until after the court has fixed the
period and such period has arrived. Such
technicality [of filing a separate action in court for
fixing of the period] need not be adhered to when
a prior and separate action would be a mere
formality and would serve no other purpose than
to delay (Borromeo v. CA, G.R. No. L-22962,
September 28, 1972).
It is only after the duration has been fixed by a
proper court that any action involving the
fulfillment or performance of the obligation can be
maintained (Eleizegui v. Manila Lawn Tennis
Club, G.R. No. 967, May 19, 1903).
Thus, there can be no possibility of any breach of
contract or failure to perform the obligation unless
the period is fixed by the courts (Pages v. Basilan
Lumber Co., G.R. No. L-10679, November 29,
1958).
NOTE: The rule presupposes that there is clear
stipulation that the obligation is subject to a term
and that only the duration is not fixed.
2. If the duration of the period depends upon the will
of the debtor (CIVIL CODE, Art. 1197, par. 2);
3. If under the circumstances the parties have
contemplated a period (CIVIL CODE, Art. 1197,
par. 3); and
4. If the debtor binds himself to pay when his means
permit him to do so (CIVIL CODE, Art. 1180).
The remedy cannot be applied to a contract of
services and pure obligations. The period of
employment is understood to be implicitly fixed, in
default of express stipulation, by the period for the
payment of the salary of the employee in accordance
with customs (Barreto v. Santa Maria, G.R. No. L-
8169, December 29, 1913).
COMPUTATION OF TERM OR PERIOD 3. When by his own acts he has Impaired said
guaranties or securities after their establishment,
1. The Civil Code
and when through a Fortuitous event they
When the law speaks of years, months, days or
disappear, unless he immediately gives new
nights, it shall be understood that years are of
ones equally satisfactory;
three hundred sixty-five (365) days each; months
of thirty (30) days; days of twenty-four (24) hours;
NOTE: Should the loss of the securities be by
and nights from sunset to sunrise.
reason of a FORTUITOUS EVENT; there must
If months are designated by their name, they
be a total disappearance in order to deprive the
shall be computed by the number of days which
debtor of the benefit of the term.
they respectively have.
4. When the debtor Violates any undertaking, in
In computing a period, the first day shall be
consideration of which the creditor agreed to the
excluded, and the last day included.” (CIVIL
period; or
CODE, Art. 13).
5. When the debtor Attempts to abscond (CIVIL
If the last day of the period, as computed, falls on
CODE, Art. 1198).
a Saturday, Sunday or a legal holiday, the time
shall not run until the next working day (RULES
OF COURT, Rule 22, Sec. 1). EFFECT IF THE DEBTOR LOSES THE
RIGHT TO MAKE USE OF THE PERIOD
A year is equivalent to 365 days regardless of The term is extinguished, and the obligation is
whether it is a year or a leap year (National demandable at once (4 PARAS, supra at 263).
Marketing Corporation v. Tecson, G.R. L-29131,
August 27, 1969).

2. The Administrative Code ALTERNATIVE OR

The SC defined a calendar month as a month
designated in the calendar disregarding the
number of days it may contain. A year shall be
understood to be 12 calendar months. The SC
held that Administrative Code of 1987
impliedly repealed Art. 13 of CIVIL CODE as
the provisions are irreconcilable (CIR v
Primetown, G.R. No. 162155, August 28, 2007).
Under the Civil Code, a year is equivalent to 365
days whether it be a regular year or a leap year.
Under the Administrative Code of 1987, however,
a year is composed of 12 calendar months.
Needless to state, under the Administrative Code
of 1987, the number of days is irrelevant (CIR v.
Aichi Forging Co. G.R. No. 184823, October 6,
2010).
WHEN THE DEBTOR LOSES THE
BENEFIT OF THE PERIOD
The debtor shall lose every right to make use of the
period: (IF-IF-VA)
1. When AFTER the obligation has been
contracted, he becomes Insolvent, unless he
gives a guaranty or security for the debt;
NOTE: The insolvency need not be judicially
declared in an insolvency proceeding (JURADO,
Obligations and Contracts, supra at 164).
FACULTATIVE
OBLIGATIONS
(ARTS 1199-1206)
ALTERNATIVE OBLIGATION
A person alternatively bound by different prestations
shall completely perform one of them (CIVIL CODE,
Art. 1199, par. 1).
In an alternative obligation, there is more than one
object, and the fulfillment of one is sufficient,
determined by the choice of the debtor who generally
has the right of election (Arco Pulp and Paper Co.,
Inc. v. Dan T. Lim, G.R. No. 206806, June 25, 2014).
Limitation: The creditor cannot be compelled to
receive part of one, and part of the other undertaking
(CIVIL CODE, Art. 1199, par. 2).
Example
"A will give B this car or this ring or this fountain pen."
A does not have to give B all three things
enumerated. The giving of one is sufficient to satisfy
the obligation (4 PARAS, supra at 264).

2. When he does not Furnish to the creditor the

guaranties or securities which he has promised;
RIGHT OF CHOICE IN ALTERNATIVE
OBLIGATIONS
GENERAL RULE: Right of choice belongs to the
debtor (CIVIL CODE, Art. 1200, par. 1).
EXCEPTIONS:
1. Expressly granted to the creditor; and
2. Expressly granted to third person (JURADO,
Obligations and Contracts, supra at 168; 4
TOLENTINO, supra at 205).
NOTE: Although the CIVIL CODE does not
expressly recognize the second, there is no
reason why it cannot be allowed, since it is not
contrary to law, morals, good customs, public
order, or public policy (JURADO, Obligations and
Contracts, supra at 739).
REQUISITES FOR THE MAKING OF THE
CHOICE (PFV-DP-WW)
1. Made Properly so that the creditor or his agent
will actually know;
2. Made with Full knowledge that a selection is
indeed being made;
3. Made Voluntarily and freely;
4. Made in Due time, that is, before or upon
maturity;
5. Made to all the Proper persons;
6. Made Without conditions, unless agreed to by
the creditor; and
7. May be Waived, expressly or impliedly (4
PARAS, supra at 268-269).
LIMITATIONS UPON THE RIGHT OF
CHOICE OF THE DEBTOR
The debtor shall have no right to choose those
prestations which are: (IU-Not)
1. Impossible;
2. Unlawful; or
3. Which could Not have been the object of the
obligation (CIVIL CODE, Art.1200, par. 2), which
refers to: (ADU)
a. Those by reason of Accident or some other
cause, have acquired a new character
distinct or different from that contemplated by
the parties when the obligation was
constituted;
b. Those which are not yet Due or demandable
at the time the selection is made; or
c. Undertakings that are not included among
others from those which the obligor may
select (JURADO, Obligations and Contracts,
supra at 168-169).
WHEN NOTICE PRODUCES EFFECT
The choice shall produce effect only upon
communication of the choice to the other party (CIVIL
CODE, Art. 1201).
FORMS OF NOTICE
Notice may be made:
1. Orally;
2. In writing;
3. Expressly/Unequivocal (4 PARAS, supra at 268;
4 TOLENTINO, supra at 206); or
4. Impliedly
a. Performance by the debtor who has the right
to choose or in the acceptance of a prestation
by the creditor when he has a right of
selection (8 MANRESA 181); or
b. When the creditor sues the debtor for the
performance of one of the prestations (4
TOLENTINO, supra at 268).
CAN THE CREDITOR TO WHOM THE
SELECTION HAD BEEN DULY
COMMUNICATED IMPUGN SUCH
SELECTION?
1st view
– In an obiter dictum in Ong Guan Can v.
Century, Inc., Co., G.R. No. L-21196, February 6,
1924, it was stated by the Supreme Court that the
“object of the notice is to give the creditor or
obligee opportunity to express his consent, or to
impugn the election made by the debtor and only
after said notice shall the election take legal effect
when consented to by the creditor, or if impugned
by the latter, when declared proper by a
competent court that it shall take effect”
(JURADO, Obligations and Contracts, supra at
169).
2nd view
– It is, however, submitted that the above doctrine
is not sound. Consent or concurrence of the
creditor to the choice or selection made by the
debtor is not necessary before the choice or
selection can produce effect. A mere declaration
of the choice, communicated to the other party, is
sufficient; it is a unilateral declaration of will (4
TOLENTINO, supra at 206).
To hold otherwise would destroy the very nature
of the right to select and the alternative character
of the obligation for that matter. Thus, according
to Dean Capistrano: “The law does not require
the creditor’s concurrence to the choice; if it did,
it would have destroyed the very nature of
alternative obligations, which empowers the
debtor to perform completely one of them’’
(JURADO, Obligations and Contracts, supra at
170).
Thus, the 2nd view is more sound because
requiring the creditor’s consent would destroy the
very essence of the right to choose and the
alternative character of the obligation itself. The
only possible exception to this rule is when the
 debtor has chosen a prestation which could not
have been the object of the obligation; the
creditor’s consent would bring about a novation
of the obligation (4 TOLENTINO, supra at 206).
Correlate: Consent or concurrence of the creditor to
the choice or selection made by the debtor is not
necessary before the choice or selection can produce
effect (4 TOLENTINO, supra at 206).
EFFECT OF NOTICE OF CHOICE: (ASIL)
1. Until the choice is made and communicated, the
obligation remains Alternative.
2. Once the notice of the election has been given to
the creditor, the obligation ceases to be
alternative and becomes Simple obligation to
perform the prestation chosen;
3. Such choice once properly made and
communicated is Irrevocable and cannot,
therefore, be renounced. An election, once
made, is binding on the person who makes it, and
he will not, therefore, be permitted to renounce
his choice and take an alternative which was first
open to him (Reyes v. Martinez, G.R. No. 32226,
December 29, 1930). To allow a change in the
selection after it has been communicated to the
other party is to expose the latter to damages
arising from preparations he may make on the
assumption that the prestation selected is the
one to be performed (4 TOLENTINO, supra at
207);
4. Where the choice has been expressly given to
the creditor, such choice shall likewise produce
Legal effects upon being communicated to the
debtor (CIVIL CODE, Art. 1205, par. 1).
DELAY IN MAKING CHOICE
The right to choose is not lost by the mere fact that
the party entitled to choose delays in making his
selection. But if the debtor who has the right to
choose makes no selection before the creditor files
his action, what prestation shall be enforced?
There are two theories in foreign jurisprudence in this
case:
1. The French Theory
– The Court should give the party entitled to choose
a period in which to make the choice, with the
intimation that if he does not choose within that
period, the Court will make the choice or will give the
right to choose to the other party (4 TOLENTINO,
supra at 208). A different solution is offered by Perez
Gonzales and Alguer who believe that the judge may
make the selection for the debtor who refuses to do
so, but this is in the light of the Spanish law of
procedure (Perez Gonzales & Alguer; 2-I
Enneccerus, Kipp & Wolf 110 cited by TOLENTINO,
supra at 208).
2. The German Theory
– The right to choose passes automatically to the
other party when there is delay on the part of the party
entitled to choose (2 Gasperi 326-327). According to
Tolentino, the German Theory is the one acceptable
under our law on the ground that although the right to
choose pertains to the debtor, he cannot paralyze the
remedy of the creditor by refusing to make a
selection. If the debtor does not exercise his right to
choose, the debtor should be deemed to have waived
his right to choose in favor of the creditor who may
then exercise such right (TOLENTINO, supra at 208).
EFFECT WHEN ONLY ONE PRESTATION
IS PRACTICABLE
The debtor shall lose the right of choice when among
the prestations whereby he is alternatively bound,
only one is practicable (CIVIL CODE, Art. 1202). If all
the prestations, except one, are impossible or
unlawful, it follows that the debtor cannot choose and
perform only that one. The obligation ceases to be
alternative and is converted into a simple obligation
to perform only feasible or practicable prestation (4
TOLENTINO, supra at 209).
NOTE: Article 1202 only applies when the debtor has
the right to choose. In case where the creditor is
granted the right to choose, Article 1205 will apply
when only one prestation remains practicable, either
due to fortuitous event or due to the fault of the debtor
(Id. at 210).
ART. 1202 V. ART. 1200, PAR. 2
ART. 1202 ART. 1200, PAR. 2
As to Prestation
There is only one There are still two or
prestation which can be more which can be
performed. performed.
As to Kind of Obligation
The obligation is The obligation is still
converted into a simple alternative because the
one because the debtor debtor can still exercise
loses his right of election his right of election.
(JURADO, Obligations and Contracts, supra at 171)
WHEN DEBTOR MAY RESCIND
CONTRACT
If the debtor cannot make a choice according to the
terms of the obligation through the creditor’s act, the
former may rescind the contract with damages (CIVIL
CODE, Art. 1203).
WHEN CREDITOR IS ENTITLED TO
INDEMNITY FOR DAMAGES
When through the fault of the debtor:
1. All the things which are alternatively the object of
the obligation have been lost; or
2. Compliance of the obligation has become
impossible (CIVIL CODE, Art. 1204).
DAMAGES HOW DETERMINED
The indemnity shall be fixed based on the value of the
last thing which disappeared or that of the service
which last became impossible (CIVIL CODE, Art.
1204, par. 2).
Damages other than the above-mentioned may also
be awarded (CIVIL CODE, Art. 1204, par. 3).
Art. 1204 of the Civil Code is applicable only to a case
where the right of choice belongs to the debtor
(JURADO, Obligations and Contracts, supra at 172)
and the loss or impossibility happened before
selection was made (4 PARAS, supra at 270).
WHEN THE CREDITOR’S RIGHT TO
CHOOSE IN AN ALTERNATIVE
OBLIGATION CEASES
When the choice has been expressly given to the
creditor, the obligation shall cease to be alternative
from the day when the selection has been
communicated to the debtor (CIVIL CODE, Art. 1205,
par. 1).
EFFECTS OF LOSS OF OBJECTS OF
ALTERNATIVE OBLIGATION
1. When Choice Belongs to Debtor:
a. Due to Fortuitous Event (CIVIL CODE, Arts.
1174, 1262 and 1266 are applicable)
i. All are lost – debtor is released from the
obligation;
ii. Some but not all are lost – the debtor
shall deliver that which he shall choose
from among the remainder. Note that if
some, but not all are lost, the obligation
still subsists and retains its alternative
character
iii. Only one remains – deliver that which
remains. Note that if only one remains,
the obligation still subsists, but it ceases
to be alternative since the obligation has
become a simple obligation to deliver the
remaining object (JURADO, Obligations
and Contracts, supra at 740).
b. Debtor’s fault (CIVIL CODE, Art. 1204 is
applicable)
i. All are lost – creditor shall have a right to
indemnity for damages based on the
value of the last thing which disappeared
or service which became impossible plus
consequential damages;
ii. Some but not all are lost – the debtor
shall deliver that which he shall choose
from among the remainder without
damages since the debtor can still
comply with his obligation. Note that if
some, but not all, are lost, the obligation
still subsists retaining its alternative
character; or
iii. Only one subsists– deliver that which
remains. Note that if only one remains,
the obligation still subsists, but it ceases
to be alternative (Id. at 740-741).
2. When Choice Belongs to Creditor:
a. Due to Fortuitous Event (CIVIL CODE, Arts.
1174, 1262 and 1266 are applicable)
i. All are lost – debtor is released from the
obligation;
ii. Some but not all are lost – deliver that
which he shall choose from among the
remainder; or
iii. Only one subsists – deliver that which
remains
b. Debtor’s fault (CIVIL CODE, Art. 1205, pars.
2 and 3 are applicable)
i. All are lost – creditor may claim the
price/value of any of them plus
consequential damages; or
ii. Some but not all are lost – creditor may
claim any of those subsisting without a
right to damages OR price/value of the
thing lost with right to damages; or
iii. Only one subsists – the obligation still
subsists, but it ceases to be alternative.
If the creditor chooses the object
remaining, the debtor cannot be held
liable for damages; however, if he
chooses any of those which were lost,
the debtor is liable for the value of the
object plus damages (JURADO,
Obligations and Contracts, supra at 173).
FACULTATIVE OBLIGATION
An obligation wherein only one object or prestation
has been agreed upon by the parties to the obligation,
but which may be complied with by the delivery of
another or the performance of another prestation in
substitution (CIVIL CODE, Art. 1206, par. 1).
Communication is necessary to effect the substitution
of the other prestation. Therefore, Art. 1201 of the
Civil Code can be applied by analogy with respect to
the time/moment when the substitution will take effect
(JURADO, Obligations and Contracts, supra at 175).
EFFECT OF LOSS OF SUBSTITUTE IN ALTERNATIVE V. LIMITED GENERIC
FACULTATIVE OBLIGATION OBLIGATIONS
1. Before substitution is made: ALTERNATIVE LIMITED GENERIC
a. If due to the bad faith or fraud of obligor –
obligor is liable. As to Prestation
b. If due to the negligence of the obligor –
obligor is not liable for damages (CIVIL Several prestations Only one prestation
CODE, Art. 1206, par. 2).

2. After substitution is made: As to Delay of the Debtor

Regardless if caused by fraud or negligence,
Debtor does not incur Debtor may incur delay
obligor is liable for damages (CIVIL CODE, Art.
delay
1206, par. 2).
As to Right to Choose
ALTERNATIVE V. FACULTATIVE
OBLIGATIONS Right to choose may be Right to choose only
given to the creditor, belong to the debtor
ALTERNATIVE FACULTATIVE debtor or third person
As to the Effect of Fortuitous Loss As to Choice
Only the impossibility of Impossibility of the Choice only involves the
all the prestations due principal prestation is Choice involves the
thing/an object of
without the fault of the sufficient to extinguish prestation
prestation
debtor extinguishes the the obligation, even if the
obligation. substitute is possible. As to Loss of Prestation

Loss of substitute merely Loss of 1 or more, but Loss of prestation

extinguishes the not all prestations extinguishes the
facultative aspect. before choice is obligation
communicated does not
As to Right to Choose extinguish the
obligation
Right to choose may be Only the debtor can
given to the creditor. choose the substitute. As to Effect of Choice Made
As to Nature Choice made and Not applicable as no
communicated, need to communicate
Various prestations all Only the principal alternative obligations choice
of which constitute parts prestation constitutes the become simple
of the obligation. obligation, the accessory
being only a means to
facilitate payment.

As to the Effect of the Nullity of Prestations JOINT AND SOLIDARY

Nullity of one of the Nullity of the principal OBLIGATIONS
prestation does not prestation invalidates the
invalidate the obligation obligation
(ARTS. 1207-1222)
which is still in force
with respect to those
which have no vice.
JOINT OBLIGATION (OBLIGACIÓN
(JURADO, Obligations and Contracts, supra at 174- MANCOMUNADA)
175). The whole obligation is to be paid or fulfilled
proportionately by different debtors or demanded
proportionately by different creditors (CIVIL CODE,
Art. 1208).

Each debtor is liable only for a proportionate part of

the debt, and the creditor is entitled to demand only a
proportionate part of the credit from each debtor (AFP
Retirement and Separation Benefits System
(AFPRSBS) v. Eduardo Sanvictores, G.R. No.
207586, August 17, 2016).
SOLIDARY OBLIGATION (OBLIGACIÓN
SOLIDARIA)
Each one of the debtors is bound to render, and/or
each one of the creditors has a right to demand entire
compliance with the prestation (CIVIL CODE, Art.
1207).
Each of the debtors is liable for the entire obligation,
and each of the creditors is entitled to demand the
satisfaction of the whole obligation from any or all of
the debtors (AFPRSBS v. Eduardo Sanvictores, .R.
No. 207586, August 17, 2016).
SOLIDARY DEBTORSHIP NOT
PRESUMED
GENERAL RULE: Obligation is presumed joint if
there is concurrence of several creditors or of several
debtors or of several creditors and debtors in one and
the same obligation (CIVIL CODE, Art. 1207).
There is a solidary liability only when the obligation
expressly so states, or when the law or the nature of
the obligation requires solidarity (CIVIL CODE, Art.
1207).
It becomes incumbent upon the party alleging that the
obligation is indeed solidary in character to prove
such fact with a preponderance of evidence
(Salvador P. Escaño v. Rafael Ortigas Jr., G.R. No.
151953, June 29, 2007).
In the absence of any fact or law which would make
defendants solidarily liable, the presumption is that
they are jointly liable (Un Pak Leung v. Juan Nigorra
et al., G.R. No. L-3128, December 19, 1907).
EXCEPTIONS: (LON-Final-Test)
1. The Law requires solidarity;
Examples: Tort, quasi-contracts, liability of
principals, accomplices and accessories of a
felony, obligations of devisees and legatees,
bailees in commodatum (CIVIL CODE, Arts. 927,
1824, 1911, 2146, 2157, 2194).
2. The Obligation expressly states that there is
solidarity;
3. Nature of the obligation requires solidarity (CIVIL
CODE, Art. 1207) e.g. criminal offenses and
torts;
4. When a solidary responsibility is imputed by a
Final judgment upon several defendants; and
5. When a charge or condition is imposed upon
heirs or legatees, and the Testament expressly
makes the charge or condition in solidum
(JURADO, Obligations and Contracts, supra at
179-180).
PRINCIPAL EFFECTS OF JOINT
LIABILITY:
1. Vices of each obligation arising from the personal
defect of a particular debtor or creditor does not
affect the obligation or right of the others;
Example: A and B are joint debtors of C for
P1,000,000. A's consent was obtained by C
through fraud. B would still be liable for P500,000,
while A will not be liable, since the 2 debts are
considered distinct from each other.
2. Insolvency of one debtor does not make others
responsible for his share;
Example: A, B, and C are joint debtors of D for
P3,000,000. If A is insolvent, B should pay D only
P1,000,000, his own proportionate share.
3. Demand by the creditor on one joint debtor puts
him in default, but not the others since the debts
are distinct;
4. When the creditor interrupts the running of the
prescriptive period by demanding judicially from
one, the others are not affected;
5. Defenses of one debtor are not necessarily
available to the others (4 PARAS, supra at 286-
287; See 8 Manresa 200-201).
FACT OF INDIVISIBILITY DOES NOT
CREATE SOLIDARITY
The indivisibility of an obligation does not necessarily
give rise to solidarity. Nor does solidarity of itself
imply indivisibility (CIVIL CODE, Art. 1210).
JOINT DIVISIBLE OBLIGATION
Credits or debts shall be presumed to be divided into
as many equal shares as there are creditors or
debtors, the credits or debts considered distinct from
one another subject to the Rules of Court governing
multiplicity of suits (CIVIL CODE, Art. 1208).
NOTE: Each creditor can demand only for the
payment of his proportionate share of the credit, while
each debtor can be held liable only for the payment
of his proportionate share of the debt (CIVIL CODE,
Arts. 1207, 1208; JURADO, Obligations and
Contracts, supra at 181).
In case of breach of obligation by one of the debtors,
damages due must be borne by him alone; if there is
any defense purely personal to one of the debtors, he
alone can avail himself of such defense (Id. at 181-
182).
JOINT INDIVISIBLE OBLIGATION INDIVISIBILITY V. SOLIDARITY
Where the obligation is merely joint, but since the INDIVISIBILITY SOLIDARITY
object is indivisible, the creditor must proceed against
ALL of the joint debtors (CIVIL CODE, Art. 1209), for As to Nature
compliance is possible only if all the joint debtors
would act together (4 PARAS, supra at 290; see also Refers to the prestation Refers to the legal tie or
CIVIL CODE, Art. 1224). which constitutes the vinculum juris, and
object of the obligation, consequently to the
Example: Performance by a musical band; where a is not capable of partial subjects or parties of the
lessor is entitled to absolute possession of a building performance. obligation.
with several lessors in possession of distinct rooms.
The obligation is joint because the parties are merely As to Plurality of Subjects
proportionately liable. It is indivisible because the
object or subject matter is not physically divisible into Exists even if there is Exists only if there is more
different parts (see CIVIL CODE, Art. 1225, par. 1). only one creditor and than one creditor or more
one debtor. Thus, than one debtor. Thus,
In other words, it is joint as to liabilities of the debtors plurality of subject is plurality of subject is
or rights of the creditors but indivisible as to not required. indispensable.
compliance (see CIVIL CODE, Art. 1224; DE LEON,
As to the Rights of the Creditor
Obligations and Contracts, supra at 243).
Each creditor cannot Each creditor may
CHARACTERISTICS OF JOINT demand more than his demand the entire
INDIVISIBLE OBLIGATIONS share and each debtor prestation and each
1. No creditor can act in representation of the other; is not bound to pay debtor is bound to pay the
2. No debtor can be compelled to answer for the more than his share. entire prestation.
liability of others;
As to the Effect of Breach
3. If there are two or more debtors, the fulfillment of
or compliance with the obligation requires the Obligation is converted When the obligation is
concurrence of all the debtors, although each for into indemnity for converted into indemnity
his own share; damages; indivisibility for damages because of
4. If there are two or more creditors, the is terminated. breach, the solidarity
concurrence or collective act of all the creditors, character of the
although each for his own share, is also obligation remains.
necessary for the enforcement of the obligation
(JURADO, Obligations and Contracts, supra at As to the Liability of Debtors
184-185);
5. Demand must, therefore, be made on ALL the Only the debtors guilty All the debtors are liable
joint debtors; of breach of obligation for the breach of the
6. If any one of the debtors does not comply with his are liable for damages. obligations committed by
obligations, it is converted into one of indemnity a debtor.
for damages (CIVIL CODE, Art. 1224);
7. If any of the joint debtors be insolvent, the others As to the Effect of the Insolvency of the
shall not be liable for his share (CIVIL CODE, Art. Debtors
1209);
8. If there be joint creditors, delivery must be made Other debtors are not All debtors are
to all, and not merely to one, unless that one be liable if one debtor is proportionately liable for
specifically authorized by the others; and insolvent. the insolvency of one
9. Each joint creditor is allowed to renounce his debtor.
proportionate credit (4 PARAS, supra at 290). (JURADO, Obligations and Contracts, supra at 187;
DE LEON, Obligations and Contracts, supra at 244)

SOLIDARITY
Solidarity may exist although the creditors and the
debtors may not be bound in the same manner and
by the same periods and conditions (CIVIL CODE,
Art. 1211).

The essence of solidarity consists in the right of each

creditor to enforce the rights of all and the liability of
each debtor to answer for the liabilities of all.
Therefore, there may be a solidary obligation
although the parties may not be bound in the same
manner and by the same periods and conditions (DE
LEON, Obligations and Contracts, supra at 243).
NOTE: Every solidary obligation has these
characteristics: unity of object and plurality of ties.
The prestation due, or to which a right exists, is one
and the same thing (DE LEON, Obligations and
Contracts, supra at 234).
KINDS OF SOLIDARITY: (PUS)
1. As to Parties bound
a. Active – Solidarity of creditors; a tie or
vinculum existing among several creditors of
one and the same obligation by virtue of
which each of them, in relation to his co-
creditors, possesses the character of creditor
only with respect to his share in the
obligation, but in relation to the common
debtor or debtors, represents all of the other
creditors;
Effect: Mutual agency among the solidary
creditors by virtue of which each creditor is
empowered to exercise against the debtor or
debtors not only the rights which correspond
to him, but also all the rights which
correspond to the other creditors, with the
consequent obligation to render an
accounting of his acts to such creditors.
b. Passive – Solidarity of debtors; tie or
vinculum existing among several debtors of
one and the same obligation by virtue of
which each of them, in relation to the
common creditor or creditors, represents all
of the other debtors, and in relation to his co-
debtors, possesses the character of debtor
only with respect to his share in the
obligation, but in relation to the common
creditor or creditors, represents all of the
other debtors; and
Effect: Mutual Guarantee. Each solidary
debtor, insofar as the creditor or creditors are
concerned, is the debtor of the entire amount;
however, with respect to his co-debtors, he is
a debtor only to the extent of his share in the
obligation
c. Mixed – solidarity on the part of the debtors
and creditors, where each one of the debtors
is liable to render, and each one of the
creditors has a right to demand, entire
compliance with the obligation
(JURADO, Obligations and Contracts, supra
at 187-188).
2. As to Uniformity
a. Uniform – parties are bound by the same
stipulations; and
b. Non-uniform or Varied – where the obligors
though liable for the same prestation, are
nevertheless not subject to the same
secondary stipulations and clauses (DE
LEON, Obligations and Contracts, supra at
226; 4 PARAS, supra at 293).
3. As to Source
a. Legal – imposed by law
b. Conventional – agreed upon by the
parties (4 PARAS, supra at 291).
Effect: Creditor can commence an action against
anyone of the debtors for compliance with the
entire obligation minus the portion or share which
corresponds to the debtor affected by the
condition or period.
JOINT OBLIGATION ON ONE SIDE,
SOLIDARY ON THE OTHER
Solidarity may exist although the creditors and the
debtors may not be bound in the same manner and
by the same periods and conditions (CIVIL CODE,
Art. 1211).
An obligation may be joint on the side of the creditors
and solidary on the side of the debtors, or vice versa.
In such cases, the rules applicable to each subject of
the obligation should be applied, the character of the
creditors or the debtors determining their respective
rights and liabilities (DE LEON, Obligations and
Contracts, supra at 247).
Illustration of effect of varied conditions or
periods: If A, B, and C borrowed P60,000 from X
binding themselves jointly and severally to pay the
entire obligation, but in the promissory note executed
by them there is a stipulation that in the case of A, the
obligation shall become due and demandable on
June 15, 2022. In the case of B, it shall become due
and demandable on June 15, 2024; and in the case
of C, it shall become due and demandable on June
15, 2026.
Immediately after June 15, 2012, X brought an action
for collection of the entire obligation against A alone
because of the latter’s failure to pay despite repeated
demands, will the action prosper?
Answer: YES. The obligation here is solidary.
However, in solidary obligations of this type, the right
of the creditor is limited to the recovery of the share
owed by the debtor whose obligation has already
matured leaving in suspense his right to recover the
shares corresponding to the other debtors whose
obligations have not yet matured. Therefore, in the
instant case, X can collect only P20,000 from A,
which is the latter’s share in the obligation. He shall EFFECTS OF PREJUDICIAL AND
have to wait for June 15, 2024, when B’s obligation BENEFICIAL ACTS
shall have matured, and for June 15, 2026, when C’s
obligation shall have also matured. Each one of the solidary creditors may do whatever
may be useful or beneficial to the others, but not
On June 15, 2024, he can collect P20,000 from either anything which may be prejudicial to the latter (CIVIL
A or B. On June 15, 2026, he can again collect CODE, Art. 1212)
another P20,000 from either A or B or C.
NOTES:
1. As far as the debtor/s is/are concerned, an act
SOLIDARITY V. SURETYSHIP performed by a solidary creditor whether
PASSIVE SOLIDARY SURETY (SOLIDARY beneficial or prejudicial to the creditors is valid
DEBTOR GUARANTOR) and binding.
2. If the act is prejudicial to the creditors, the creditor
As to Liability who performed such act shall incur the obligation
of indemnifying the others for damages.
Both are solidarily liable to the creditor for the 3. In the case of remission or condonation (which is
payment of the entire obligation. prejudicial), the solidary creditor is allowed to
remit, and the obligation is extinguished, without
As to the Extent of the Liability prejudice to his liability to the other creditors (4
Liable not only for the Liable only for the share PARAS, supra at 295).
payment of the debt of of the principal debtor.
another, but also for the EFFECTS OF ASSIGNMENT OF RIGHTS
payment of a debt IN SOLIDARY OBLIGATIONS
which is properly his GENERAL RULE: A solidary creditor cannot assign
own. his rights without the consent of others (CIVIL CODE,
Art. 1213).
As to the Right of Reimbursement
REASON: Solidary creditorship is predicated upon
Has a right to demand Acquires a right of
mutual agency and mutual confidence, i.e., personal
reimbursement from his reimbursement from the
qualification of each creditor had been taken into
co-debtors of the principal debtor of the
consideration.
shares which entire amount he has
correspond to them in paid.
EXCEPTIONS: (CC)
the obligation, if he pays
1. Assignment to a Co-creditor (JURADO,
the entire amount of the Thus, the surety can be
Obligations and Contracts, supra at 196); and
obligation. reimbursed for
2. Assignment is with Consent of co-creditors (4
everything he paid.
PARAS, supra at 296).
Thus, the solidary
debtor can be
reimbursed what he has EFFECT OF UNAUTHORIZED
paid minus his own ASSIGNMENT
share. 1st View:
Article 1213 seems to imply that such assignment
As to the Effect of the Extension of Time is invalid.
In passive solidarity, an An extension of time
NOTE: This rule is unjustifiable and places an
extension of time granted by the creditor
unnecessary restriction on the rights of the
granted by the creditor to the principal debtor
solidary co-creditor upon his share. The reason
to one of the solidary would release the surety
behind it seems to be that each creditor
debtors without the from the obligation.
represents the others and, therefore, must have
knowledge of the other
the confidence of the latter.
solidary debtors would
not have the effect of
releasing the latter from 2nd View (Manresa):
obligation. A solidary creditor who assigns his rights without
the consent of his co-creditors shall answer
(JURADO, Obligations and Contracts, supra at 189; subsidiarily for any prejudice caused to the latter
4 PARAS, supra at 303-304). by the assignee in connection with the credit.
 NOTE: The representation (by each creditor) of
the solidary creditors is created by law and not by
consent or agreement of the parties. If danger is
seen in the possible misfeasance of the
assignee, the remedy is not the paralyzation of
the proprietary rights of the solidary creditor, but
to impose upon him a subsidiary responsibility for
the acts of the assignee, similar to that of the
agent for the acts of the sub-agent under Art.
1892 (DE LEON, Obligations and Contracts,
supra at 249).
TO WHOM PAYMENT MADE IN
SOLIDARY OBLIGATION
GENERAL RULE: Payment may be made to any of
the solidary creditors (CIVIL CODE, Art. 1214).
EXCEPTION: If demand, judicial or extra-judicial, has
been made by one of them, payment should be made
to him (CIVIL CODE, Art. 1214).
REASON: When one creditor makes an extrajudicial
or judicial demand for payment, the tacit
representation by the other creditors is considered
revoked and during the pendency of the action, the
creditors who did not sue lose their representation of
the others (DE LEON, Obligations and Contracts,
supra at 230).
AS TO THE EFFECT OF RES JUDICATA
TO THE OTHER CREDITORS
Under Art. 1214 of the CIVIL CODE, once an action
is filed by a solidary creditor, he represents all the
others and payment can be made only to him. If the
filing of the action consolidates in the plaintiff creditor
all the rights of the other co-creditors, the latter must
benefit from the favorable results and suffer from the
adverse consequences of such action. However, the
other creditors will not be adversely affected, if the
judgment is based on a cause personal to the plaintiff
in the first action (4 TOLENTINO, supra at 242).
NOTE: In case of mixed solidarity, a judicial or
extrajudicial demand would prohibit the debtor upon
whom the demand is made from making a payment
to any creditor other than to the one who made the
demand. This prohibition, however, does not extend
to the other debtors upon whom no demand has been
made and so each of such debtors can still validly
tender payment to a creditor other than to the creditor
who made the demand (JURADO, Obligations and
Contracts, supra at 197).
EFFECT OF DEMAND UPON A of payment; it does not create a real case of
SOLIDARY DEBTOR
The demand made against one of them shall not be
an obstacle to those which may subsequently be
directed against the others so long as the debt has
not been fully collected (CIVIL CODE, Art. 1216).
The creditor may proceed against any one of the
solidary debtors or against all of them simultaneously
(CIVIL CODE, Art. 1216).
A creditor’s right to proceed against the surety exists
independently of his right to proceed against the
principal (Palmares v. CA, G.R. No. 126490, March
31, 1998).
NOTE: If a claim from one of the solidary debtors has
been dismissed by a court on grounds other than the
extinguishment of the whole obligation or that the
claim has prescribed, it does not necessarily mean
that the solidary indebtedness cannot be claimed
against the other solidary debtors who were not
impleaded in the case or against those who were
impleaded but whose liability was found by the court
as proper (Inciong v. CA, G.R. No. 96405, June 26,
1996).
EFFECT OF PAYMENT TO A CREDITOR
If one of the solidary creditors is able to collect the
entire amount of the debt from one or some or all of
the solidary debtors, the obligation is totally
extinguished, although there arises a consequent
obligation on his part to render an account to his co-
creditors (CIVIL CODE, Art.1215, par. 2).
NOTE: Solidarity does not make a solidary obligor an
indispensable party in a suit filed by the creditor
(Operations Incorporated v. American Biscuit Co.
Inc., G.R. No. L-34767, October 23, 1987). Likewise,
the nature of the solidary obligation under the surety
does not make one an indispensable party (Living @
Sense, Inc. v. Malayan Insurance Company, Inc.,
G.R. No. 193753, September 26, 2012).
EFFECT OF PAYMENT BY A DEBTOR
Payment made by one of the solidary debtors, either
totally or partially, extinguishes the obligation
depending upon whether the entire amount of debt is
paid or only a part thereof (CIVIL CODE, Art. 1217,
par. 1).
If two or more solidary debtors offer to pay, the
creditor may choose which offer to accept (CIVIL
CODE, Art. 1217, par. 1).
Solidary debtor who made the payment merely
entitles him to claim from his co-debtors the share
which corresponds to them with interest from the time
subrogation; if payment was made before the debt is
due, no interest for the intervening period may be
demanded (CIVIL CODE, Art. 1217, par. 2).
REASON: The right of the paying co-debtor to be
reimbursed is not based on the original obligation but
upon the payment made by him (DE LEON,
Obligations and Contracts, supra at 254).
NO RIGHT OF REIMBURSEMENT WHERE
PAYMENT IS ILLEGAL
Payment by a solidary debtor shall not entitle him to
reimbursement from his co-debtors if such payment
is made after the obligation has prescribed or become
illegal (CIVIL CODE, Art. 1218).
INSOLVENCY OF A SOLIDARY DEBTOR
BORNE BY CO-DEBTORS
When one of the solidary debtors cannot, because of
his insolvency, reimburse his share to the debtor
paying the obligation, such share shall be borne by
all his co-debtors, in proportion to the debt of each
(CIVIL CODE, Art. 1217).
EFFECT OF DEATH OF PRINCIPAL
DEBTOR
Under the law and jurisprudence, the creditor may
sue, separately or together, the principal debtor and
the surety, in view of the solidary nature of their
liability. The death of the principal debtor will not work
to convert, decrease or nullify the substantive right of
the solidary creditor. Evidently, despite the death of
the principal debtor, the creditor may still sue the
surety alone in accordance with the solidary nature of
the latter’s liability under the performance bond
(Stronghold Insurance Co. v. Republic – Asahi Glass
Corp., G.R. No. 147561, June 22, 2006).
In case of death of one of the solidary debtors, the
creditor may proceed against the estate of the
deceased solidary debtor alone or against any or all
of the surviving solidary debtors whose liability is
independent of and separate from the deceased
debtor, instead of instituting a proceeding for the
settlement of the estate of the deceased debtor
wherein his claim could be filed (Imperial Insurance,
Inc. v. David, G.R. No. L-32425, November 21, 1984).
EFFECT OF NOVATION,
COMPENSATION, CONFUSION, AND
REMISSION IN SOLIDARY OBLIGATIONS
NOVATION
Novation is the change or substitution of an obligation
by another, resulting in its extinguishment or
modification, either by changing its object or principal
condition, or by substituting another in place of the
debtor, or by subrogating a third person in the rights
of the creditor(CIVIL CODE, Art. 1291).
COMPENSATION
Compensation shall take place when two persons, in
their own right, are creditors and debtors of each
other (CIVIL CODE, Art. 1278) such that the amount
of their respective debts are set off against each
other.
CONFUSION
Confusion or merger is the extinguishment of an
obligation from the time the characters of creditor and
debtor are merged in the same person (CIVIL CODE,
Art. 1275).
REMISSION
Condonation or remission is a gratuitous renunciation
by the creditor of his right to enforce the obligation
against the debtor which necessarily results in the
extinguishment of the obligation, whether wholly or in
part. Being gratuitous, it is a form of donation
requiring the acceptance of the debtor (CIVIL CODE,
Art. 1270).
EFFECT OF MODES OF EXTINGUISHING
OBLIGATIONS NOT CONSTITUTING
PAYMENT
Novation, compensation, confusion or remission of
the debt, made by any of the solidary creditors or with
any of the solidary debtors, shall extinguish the
obligation. The creditor who may have executed any
of these acts, as well as he who collects the debt,
shall be liable to the others for the share in the
obligation corresponding to them (CIVIL CODE, Art.
1215).
NOTES:
1. In other words, novation, compensation,
confusion, or remission entered into by one of the
solidary creditors will have the same effect as if
the creditor was the only creditor. To the debtors,
the obligation are extinguished to the extent
novated, compensated, confused, or remitted.
2. As novation is the only act of extinguishment
which may result to a beneficial outcome to the
solidary co-creditors, Article 1212 may also come
into operation as to allow any benefit secured by
the co-creditor to inure to them in proportion with
their interest.
3. The solidary creditor who grants a novation
prejudicial to his co-creditors, or who
compensates or confuses his own liabilities with
that of the debtors, or remits the debtor’s debt,
shall be liable to reimburse his co-creditors to the
extent that each of them shall be proportionally
prejudiced by such act (DE LEON, Obligations
and Contracts, supra at 254).
GRANT OF GRACE PERIOD ONLY
AFFECTS THE GRANTOR
GENERAL RULE: An extension of time granted by
the creditor to a solidary debtor does not amount to a
novation that will discharge the other solidary
debtors. The latter shall be liable for the whole debt
less the share of the debtor to whom the extension
was granted CIVIL CODE
EXCEPTION: In cases of suretyship, where the
sureties are bound in solidum, a different rule applies.
A material alteration of the principal contract, effected
by the creditor and the principal debtor, without the
knowledge and consent of the sureties, completely
discharges the sureties from all liabilities (4
TOLENTINO, supra at 237-238).
EFFECTS OF COMPENSATION OR
CONFUSION
Suppose that A and B are solidary debtors of X and
Y, solidary creditors, in the amount of P1000.
1. Total Compensation/Confusion
X also owes A P1000 so compensation/confusion
may occur.
a. Debtor’s Side
i. P1000 solidary debt is extinguished.
ii. Since A was only liable solidarily for
P500, but A’s credit of P1000 was used
to compensate/confused, it is as if A paid
B’s portion. Thus B must reimburse A,
P500.
b. Creditor’s Side
i. Since X only had P500 of credit but
P1000 of his debts were extinguished, it
is as if X receive P500 on behalf of Y,
thus, X must reimburse Y P500.
2. Partial Compensation/Confusion
X also owes A P700 so compensation/confusion
may occur partially
a. Debtor’s Side
i. P700 solidary debt is extinguished
(divisible obligation). P300 still
outstanding.
ii. Since A was only liable solidarily for
P500, but A’s credit of P700 was used to
compensate/confused, it is as if A paid
B’s portion for up to P200. Thus B must
reimburse A, P200.
iii. Since P300 is still outstanding, A may still
be asked to pay, without prejudice to
being reimbursed fully for the P300 if he
pays,
b. Creditor’s Side
i. Since X only had P500 of credit but P700
of his debts were extinguished, it is as if
X receive P200 on behalf of Y, thus, X
must reimburse Y P200.
ii. Since P300 is still outstanding, X may still
demand P300 without prejudice to any
duty on his part to remit the entire P300
which is ultimately Y’s share.
REMISSION GRANTED TO SOLIDARY
DEBTORS
The remission made by the creditor of the share
which affects one of the solidary debtors does not
release the latter from his responsibility towards the
co-debtors, in case the debt had been totally paid by
anyone of them before the remission was effected
(CIVIL CODE, Art. 1219).
EFFECTS OF REMISSION
Suppose that A and B are solidary debtors of X and
Y, solidary creditors, in the amount of P1000.
1. Total Remission
X forgives all P1000 debt
a. Debtor’s Side
i. P1000 solidary debt is extinguished.
ii. Even if A was the one who secured it, it
is as if it was granted to each and every
debtor (CIVIL CODE, Art 1220)
iii. A has no right to demand P500 from B
because A did not pay anything to X/Y.
b. Creditor’s Side
i. Since X only had P500 of credit, his act
prevented Y from getting paid for his
share. Thus, X must pay P500 to Y if Y
did not consent to the remission.
2. Partial Remission
X forgives a portion of A’s debt worth P500
a. Debtor’s Side
i. If the remission is intended to benefit A
only
1.) Then A’s share is extinguished.
2.) A however is still a solidary debtor to
the P500 share of B still outstanding,
except that if A pays any amount, B
must reimburse since only B is
ultimately liable.
ii. If the remission is intended to benefit
both A and B
1.) It is as if A and B are now just
solidarily indebted for P500 (or P250
each)
2.) The normal rules of solidary
debtorship apply but only for P500
debt instead of P1000
b. Creditor’s Side
i. Since X remitted P500, he did not impair
the share of Y. No obligation to
reimburse.
ii. If X remitted an amount less than P500,
then only X’s right is affected such that
he can only enforce payment on the
 difference of P500 and the amount he
remitted.
iii. If X remitted an amount exceeding P500,
then he must reimburse the amount in
excess of P500, and any future
payments received must be remitted to Y
entirely.
EFFECT OF REMISSION OF SHARE
AFTER PAYMENT
1. If payment is made first, the remission or waiver
is of no effect. There is no more obligation to
remit.
2. If remission is made previous to the payment and
payment is made, solutio indebiti arises. It is
incumbent upon the debtor whose debt is
remitted, to prove the priority of the remission to
the payment to release him from responsibility
towards his co-debtors (DE LEON, Obligations
and Contracts, supra at 259).
EFFECT OF LOSS OR IMPOSSIBILITY OF
PERFORMANCE IN SOLIDARY
OBLIGATION
1. If the thing has been lost or if the prestation has
become impossible without the fault of the
solidary debtors, the obligation shall be
extinguished (CIVIL CODE, 1221 par. 1).
2. If the loss or impossibility is due to the fault of one
of the solidary debtors (CIVIL CODE, 1221, par.
2) or due to a fortuitous event after one of the
solidary debtors had already incurred in delay,
the obligation is converted into an obligation of
indemnity for damages but the solidary character
of the obligation remains (CIVIL CODE, 1221,
par. 3).
DEFENSES AVAILABLE TO A SOLIDARY
DEBTOR: (NP-ShOt)
1. Defenses derived from the Nature of the
obligation
– total defense; all the solidary co-debtors are
benefited.
Example: Payment or performance, res judicata,
prescription, those which invalidate the contract
such as mistake, violence, and others of similar
nature.
2. Defenses Personal to the debtor
– constitutes total defense and partial defense.
Examples of Total Defense: Minority, insanity,
and other defenses which are purely personal to
the debtor.
Examples of Partial Defense: Special terms or
conditions affecting his part of the obligation.
3. Defenses pertaining to the debtor’s own
Share
– constitutes a partial defense; only the debtor is
benefited.
Example: Share of debtor is not yet due, the
creditor can only compel the share of other co-
debtors.
4. Defenses personal to the Other solidary
debtors, but only as regards that part of
the debt for which the latter are
responsible
– constitutes partial defense only for the debtor-
defendant (CIVIL CODE, Art. 1222).
Example: The co-debtor’s share is not yet due,
so the creditor can only compel the debtor to give
his share. (4 TOLENTINO, supra at 250-251;
JURADO, Obligations and Contracts, supra at
210-212).
DIVISIBLE OBLIGATIONS
(ARTS. 1223-1225)
DIVISIBLE OBLIGATIONS
Those which have as their object a prestation which
is susceptible of partial performance without the
essence of obligation being changed (JURADO,
Obligations and Contracts, supra at 212).
In determining the divisibility of an obligation, the
following factors may be considered, to wit:
1. The will or intention of the parties, which may be
expressed or presumed;
2. The objective or purpose of the stipulated
prestation;
3. The nature of the thing; and
4. Provisions of law affecting the prestation
(Spouses Lam v. Kodak Philippines, Ltd., G.R.
No. 167615, January 11, 2016).
INDIVISIBLE OBLIGATIONS
Those which have as their object a prestation which
is not susceptible of partial performance, otherwise,
the essence of the obligation will be changed or its
value will be decreased (JURADO, Obligations and
Contracts, supra at 212).
NOTE: The divisibility of an obligation should not be
confused with the divisibility of the thing which is the
object thereof (DE LEON, Obligations and Contracts,
supra at 265).
THREE KINDS OF DIVISION: 2. Obligations which are Not susceptible of partial
performance;
1. Quantitative
3. Obligations Intended by the parties to be
– the thing can be materially divided into parts
indivisible even if the thing or service is physically
and such parts are homogenous to each other;
divisible;
a. Movable– parts are actually separated from
4. Obligations provided by Law to be indivisible
each other.
even if the thing or service is physically divisible
b. Immovable–the limits of the parts are fixed
(CIVIL CODE, Art. 1225, pars. 1 and 3).
by metes and bounds.

2. Qualitative PRINCIPLE OF INDIVISIBILITY OF

– the thing can be materially divided but the parts OBLIGATIONS
are not exactly homogenous e.g., division of Creditor cannot be compelled partially to receive the
inheritance; and prestation in which the obligation consists; neither
may the debtor be required to make partial payments
3. Ideal/Intellectual (CIVIL CODE, Art. 1248).
– the thing cannot be separated into material
parts e.g., co-ownership (JURADO, Obligations EXCEPTIONS:
and Contracts, supra at 213). 1. When the obligation expressly stipulates the
contrary (CIVIL CODE, Art. 1248, par. 1);
TEST OF DIVISIBILITY 2. When the obligation is in part liquidated and in
part unliquidated (CIVIL CODE, Art. 1248, par.
Whether the prestation is susceptible of partial
2);
performance or not (CIVIL CODE, Art. 1225, par. 1).
3. When the different prestations constituting the
objects of the obligation are subject to different
The susceptibility of partial compliance should be
terms and conditions.
understood in the sense of the possibility of realizing
the end or purpose which the obligation seeks to
NOTE: When there is plurality of debtors and
attain. Hence, the purpose of the obligation is the
creditors, the effect of divisible or indivisible character
controlling circumstance. This applies not only to
of the obligation depends on whether the obligation is
obligations to give, but also to obligations to do or not
joint or solidary:
to do (JURADO, Obligations and Contracts, supra at
1. If solidary
215).
– Arts. 1211 to Art. 1222 of the CIVIL CODE
In obligations to give, even though the object may be
apply;
physically divisible, the obligation is still indivisible if it
is provided by law or it is so intended by the parties
2. If joint divisible
(CIVIL CODE, Art. 1225, par. 2).
– Art. 1208 of the CIVIL CODE is applicable;
and
INSTANCES WHEN PERSONAL
OBLIGATION IS DEEMED DIVISIBLE 3. If joint indivisible
In obligations to do, the obligation shall be considered – Arts. 1209 and 1224 of the CIVIL CODE apply
divisible when it has for its object (CIVIL CODE, Art. (JURADO, Obligations and Contracts, supra at
1225, par. 3): (EAN) 214).
1. The Execution of a certain number of days of
work; BREACH OF JOINT INDIVISIBLE
2. The Accomplishment of work by metrical units; or OBLIGATION
3. The accomplishment of analogous things which
A joint indivisible obligation gives rise to indemnity for
by their Nature are susceptible of partial
damages from the time anyone of the debtors does
performance.
not comply with his undertaking. The debtors who
may have been ready to fulfill their promises shall not
In obligations not to do, it depends upon the character
contribute to the indemnity beyond the corresponding
of the prestation in each particular case (CIVIL
portion of the price of the thing or of the value of the
CODE, Art. 1225, par. 4).
service in which the obligation consists (CIVIL CODE,
Art. 1224).
IN SUMMARY, THE INSTANCES WHEN
THE OBLIGATION IS DEEMED
INDIVISIBLE
An obligation is deemed indivisible in the following:
(D-NIL)
1. Obligations to give Definite things;
 OBLIGATIONS WITH 2. Función liquidatoria
– to liquidate the amount of damages to be
PENAL CLAUSE awarded to the injured party in case of breach of
(ARTS. 1226-1230) the principal obligation (compensatory); and

3. Función estrictamente penal

OBLIGATIONS WITH A PENAL CLAUSE
An obligation to which an accessory undertaking
(penal clause or penalty) is attached for the purpose
of insuring its performance by virtue of which the
obligor is bound to pay a stipulated indemnity or
perform a stipulated prestation in case of breach
(JURADO, Obligations and Contracts, supra at 217).
PRINCIPAL OBLIGATION
– is one which can stand by itself and does not
depend for its validity and existence upon another
obligation.
ACCESSORY OBLIGATION
– is one which is attached to a principal obligation
and, therefore, cannot stand alone.
PENAL CLAUSE
– is an accessory undertaking attached to an
obligation to assume greater liability on the part of the
obligor in case of breach of the obligation, i.e., the
obligation is not fulfilled, or is partly or irregularly
complied with (DE LEON, Obligations and Contracts,
supra at 272).
PENAL CLAUSE V. CONDITION
PENAL CLAUSE CONDITION
As to Whether it Constitutes an Obligation
– in certain exceptional cases, to punish the
obligor in case of breach of the principal
obligation (punitive). Does not resolve the
question of damages (JURADO, Obligations and
Contracts, supra at 217-218).
A penal clause has a double function: (1) to provide
for liquidated damages; and (2) to strengthen the
coercive force of the obligation by threat of greater
responsibility in the event of breach (Filinvest Land,
Inc., v. CA, G.R. No. 138980, September 20, 2005).
KINDS OF PENALTY:
1. As to Origin
a. Legal – constituted by law
b. Conventional – constituted by agreement of
the parties
2. As to Purpose
a. Compensatory – indemnity for damages
suffered by the creditor in case of breach of
obligation
b. Punitive – punishing the obligor in case of
breach of obligation
3. As to Effect
a. Subsidiary – only penalty may be demanded
b. Joint or Complementary – both penalty and
principal obligation may be demanded
(JURADO, Obligations and Contracts, supra
at 218).

Constitutes an Does not constitute an OBLIGATIONS WITH A PENAL CLAUSE

obligation. obligation. V. CONDITIONAL OBLIGATION
As to Demandability OBLIGATION WITH A CONDITIONAL
PENAL CLAUSE OBLIGATION
May become Never demandable
demandable upon As to Existence of Obligation
default of the
unperformed obligation No obligation before the
and sometimes jointly suspensive condition
There is already an
with it. happens. It is the
existing obligation from
fulfillment of the condition
(8 MANRESA, p. 244, as cited in 4 PARAS, supra at the very beginning.
that gives rise to the
325). obligation.

PURPOSE OF PENALTY: As to Dependency on Principal Obligation

1. Función coercitiva o de garantia
Penalty (an accessory Principal obligation itself
– to insure the performance of the obligation; obligation) is dependent is dependent upon the
upon the non- uncertain event.
 OBLIGATION WITH A CONDITIONAL OBLIGATIONS WITH A PENAL CLAUSE
PENAL CLAUSE OBLIGATION V. GUARANTY
OBLIGATION WITH A
performance of the GUARANTY
principal obligation. PENAL CLAUSE

(4 TOLENTINO, supra at 262-263). As to Similarity in Obligations

OBLIGATIONS WITH A PENAL CLAUSE
V. ALTERNATIVE OBLIGATION
OBLIGATION WITH A
PENAL CLAUSE
Obligation to pay the Object of the obligations
penalty is different from of the principal debtor
the principal obligation. and the guarantor is the
ALTERNATIVE same.
OBLIGATION

As to Number of Prestations As to Assumption of the Principal Obligation

There is only one Two or more obligations Principal obligation and Principal debtor cannot
prestation. are due. the penalty can be be the guarantor of the
assumed by the same same obligation.
As to Effect of Impossibility person.

Impossibility of the The impossibility of one As to Extinguishment

principal extinguishes of the obligations,
also the penalty. without the fault of the As a rule, penalty is Guaranty subsists even
debtor, leaves the other extinguished by the when the principal
subsisting. nullity of the principal obligation is voidable,
obligation. Except when unenforceable or a
As to Choice of the Debtor in Fulfilling the penal clause is natural one.
Obligation assumed by a third
person.
The obligor cannot Debtor can choose
choose to pay the which prestation to fulfill.
penalty to relieve If the penal clause is
himself of the principal, assumed by a 3rd
unless this right is person, the same
expressly granted to principle will apply as in
him. the case of a guaranty.
(Id.at 263).
(Id. at 263-264).
OBLIGATIONS WITH A PENAL CLAUSE
EFFECT OF PENALTY
V. FACULTATIVE OBLIGATION
GENERAL RULE: The penalty shall substitute the
OBLIGATION WITH A FACULTATIVE indemnity for damages and payment of interest in
PENAL CLAUSE OBLIGATION case of noncompliance (CIVIL CODE, Art. 1226, par.
1).
As to Substitution
NOTE: Proof of actual damages suffered by the
Payment of the penalty Power of the debtor to creditor is not necessary in order that the penalty may
in lieu of the principal make the substitution is be demanded. (CIVIL CODE, Art. 1228).
obligation can be made absolute.
only by express EXCEPTIONS: (SRF)
stipulation. 1. When there is a Stipulation to the
As to Demand contrary;

The creditor can The creditor can never NOTE: The law permits an agreement upon a
demand both demand both penalty apart from the interest. Should there be
prestations as may be prestations. such an agreement, the penalty does not include
granted to him. the interest and as such, the two are different and
distinct things which may be demanded
(Id.at 263). separately. A stipulation about payment of
additional rate of interest partakes of the nature
 of a penalty clause which is sanctioned by law
(DE LEON, Obligations and Contracts, supra at
277).
2. When the obligor Refuses to pay the
penalty;
3. When the obligor is guilty of Fraud (Id. at
277).
REASON: There can be no renunciation of an
action to enforce liability for future fraud because
this is against public policy and against the
express provisions of the law (CIVIL CODE, Art.
1171).
NOTE: Breach of the obligation WITHOUT fraud
cannot constitute one of the exceptions
(Cabarroguis, et al. v. Vicente, L-14304, March
23, 1960).
ENFORCEABILITY OF PENALTY
Penalty, as a stipulation in a contract, is demandable
only if there is a breach of the obligation (CIVIL
CODE, Art. 1226, par. 2).
Like all contractual stipulations, it should not be
contrary to law, morals, good customs, public order
or public policy (CIVIL CODE, Art. 1306).
Where both of the contracting parties are unable to
comply with their respective obligations, although the
breach is not willful or culpable, the penal clause
cannot be invoked by anyone of them to the prejudice
of the other (JURADO, Obligations and Contracts,
supra at 224).
WHEN PENAL CLAUSE CANNOT BE
ENFORCED:
1. The breach is the fault of the creditor;
2. A fortuitous event intervened, unless the debtor
expressly agreed on his liability in case of
fortuitous events (where he acts as “insurer”); or
3. The debtor is not yet in default (4 PARAS, supra
at 339).
LIMITATION UPON THE RIGHT OF THE
DEBTOR IN OBLIGATIONS WITH A
PENAL CLAUSE
GENERAL RULE: Debtor cannot exempt himself
from the performance of the principal obligation by
paying the stipulated penalty (CIVIL CODE, Art.
1227).
EXCEPTION: Unless this right has been expressly
reserved for him (CIVIL CODE, Art. 1227).
REASON: If the debtor is allowed to pay the penalty
in lieu of the principal obligation, this would make the
obligation an alternative one (DE LEON, supra at
258).
LIMITATIONS ON THE RIGHT OF THE
CREDITOR IN OBLIGATIONS WITH A
PENAL CLAUSE
GENERAL RULE: Creditor cannot demand the
fulfillment of the principal obligation and the
satisfaction of the penalty at the same time (CIVIL
CODE, Art. 1227).
EXCEPTIONS:
1. Where the right to demand both the principal
obligation and the penalty has been clearly
granted to him (CIVIL CODE, Art. 1227).
2. Where the creditor has demanded fulfillment of
the principal obligation but it cannot be
performed, thus in such a case, he may demand
the penalty (CIVIL CODE, Art. 1227; 4
TOLENTINO, supra at 265).
NOTE: The clause “performance thereof should
become impossible without his (creditor’s) fault” of
Art. 1227 could refer to impossibility due to fortuitous
events, in which case the principal obligation would
be extinguished, and so will the penal clause (Id. At
266).
PROOF OF ACTUAL DAMAGES
Proof of actual damages suffered by the creditor is
not necessary in order that penalty may be
demanded (CIVIL CODE, Art. 1228).
NOTE: This is applicable only to the general rule
stated in Art. 1226 of the Civil Code, and not to the
exceptions (JURADO, Obligations and Contracts,
supra at 225).
Consequently, if the penalty is fixed by the
contracting parties for the purpose of compensating
or substituting the indemnity for damages and the
payment of interests, proof of actual damages
suffered by the obligee or creditor is not necessary in
order that the penalty may be demanded. In this
sense, penalty is exactly identical with what is known
as “liquidated damages” under Art. 2226 of the Civil
Code (Id. at 225).
However, if there is stipulation to the contrary, or if the
obligor or debtor is sued for refusal to pay the agreed
penalty, or if the obligor or debtor is guilty of fraud,
then the obligee or creditor can demand not only the
satisfaction of the agreed penalty, but even damages.
In such case, in order to be able to recover such
damages in addition to the penalty, he must prove the
amount of damages which he had actually suffered
(Id. at 225).
WHEN PENALTY MAY BE REDUCED:
(PIU)
1. If the principal obligation has been Partly
complied with;
2. If the principal obligation has been Irregularly
complied with; and
3. If the penalty is iniquitous or Unconscionable
even if there has been no performance (CIVIL
CODE, Art. 1229).
The power of a judge to reduce the penalty refers only
to penalties prescribed in contracts.
EFFECT OF NULLITY OF OBLIGATION
OR PENALTY
If principal obligation is void, penal clause shall also
be void because the penalty is merely an accessory
obligation. But if the penal clause is void, principal
obligation is not affected (CIVIL CODE, Art. 1230).
EXTINGUISHMENT OF
OBLIGATIONS
(ARTS. 1231-1304)
EXTINGUISHMENT OF OBLIGATIONS:
(PLR-MCN-FRAP)
1. By Payment or performance (CIVIL CODE, Arts.
1232-1261);
2. By the Loss of the thing due (CIVIL CODE, Arts.
1262-1269);
3. By the condonation or Remission of the debt
(CIVIL CODE, Arts. 1270-1274);
4. By the confusion or Merger of the rights of the
creditor and debtor (CIVIL CODE, Arts. 1275-
1277);
5. By Compensation (CIVIL CODE, Arts. 1278-
1290);
6. By Novation (CIVIL CODE, Arts. 1291-1304);
7. Fulfillment of a resolutory condition;
8. Rescission;
9. Annulment;
10. Prescription (CIVIL CODE, Art. 1231, par. 2);
NOTE: Enumeration under Art. 1231 is NOT
exclusive (JURADO, Obligations and Contracts,
supra at 230).
OTHER FORMS OF EXTINGUISHMENT
NOT UNDER ART. 1231: (DWERC-FMI)
1. Death of one of the contracting parties in purely
personal obligations (CIVIL CODE, Art. 1311,
par. 1; JURADO, Obligations and Contracts,
supra at 230);
2. The Will of one of the contracting parties in
certain contracts (JURADO, supra at 230);
3. Expiration of the resolutory term or period (CIVIL
CODE, Art. 1193, par. 2; JURADO, supra at 230);
4. Renunciation or waiver by the obligee or creditor
(JURADO, supra at 230);
5. Compromise (CIVIL CODE, Art. 2028; JURADO,
supra at 230);
6. Fortuitous event (CIVIL CODE, Art. 1174);
7. Mutual desistance or withdrawal;
8. Impossibility of fulfillment of condition (CIVIL
CODE, Art. 1266);
PAYMENT OR
PERFORMANCE
HOW PAYMENT MADE
PAYMENT OR PERFORMANCE
Not only the delivery of money but also the
performance, in any other manner, of an obligation
(CIVIL CODE, Art. 1232).
[Delivery of a sum of money] made as consideration
for a reserved right, option or privilege is not
governed by Arts. 1232 to 1262, because such
“payment” cannot be demanded by the creditor
(Asturias Sugar Central v. Pure Cane Molasses Co.,
G.R No. L-40709, August 1, 1934).
NOTE: “Payment” is a technical term in law used
specifically to refer to the performance of an
obligation. Not all delivery of a sum of money is
considered “payment” in law.
AMOUNT CREDITED TO THE ACCOUNT
OF THE PAYEE EXTINGUISHES A
CONTRACTUAL OBLIGATION
As the transaction is for the establishment of a
telegraphic or cable transfer, the agreement to remit
creates a contractual obligation and has been termed
a purchase and sale. The purchaser of a telegraphic
transfer upon making payment completes the
transaction insofar as he is concerned, though insofar
as the remitting bank is concerned the contract is
executory until the credit is established. Thus, once
the amount represented by the telegraphic transfer
order is credited to the account of the payee or
appears in the name of the payee in the books of the
receiving bank, the ownership of the telegraphic
transfer order is deemed to have been transmitted to
the receiving bank. Chinatrust is, thus, deemed to
have fully executed the telegraphic transfer
agreement and its obligation to respondent was
extinguished. Hence, respondent could no longer ask
for rescission of the agreement (Chinatrust (Phils.)
Commercial Bank v. Turner, G.R. No. 191458, July 3,
2017).
BURDEN OF PROVING PAYMENT
When the existence of a debt is fully established by
the evidence, the settled rule is that the burden of
proving extinguishment by payment devolves upon
the debtor who pleads payment or offers such a
defense to the claim of the creditor rather than on the
latter to prove non-payment. The debtor has the
burden of showing with legal certainty that the
obligation has been discharged by payment. Only
when the debtor introduces evidence that the
obligation has been extinguished does the burden
shift to the creditor (Cham v. Paita-Moya, A.C. No.
7494, June 27, 2008).
There is a disputable presumption that money paid by
one to another was due to the latter (RULES OF
COURT, Rule 131, Sec. 3 (f)).
REQUISITES OF PAYMENT: (Pr-PeT-
CMES)
1. Payor or the person who pays;
2. Payee or the person to whom payment is made;
3. Thing or object in which payment must consist;
4. The Cause thereof;
5. Manner, time, and place of payment;
6. The imputation of Expenses occasioned by it;
and
7. The Special parts which may modify the same
and the effects they generally produce (4
TOLENTINO, supra at 274; DE LEON,
Obligations and Contracts, supra at 298-299).
KINDS OF PAYMENT:
1. Normal
– when the debtor voluntarily performs the
prestation as agreed upon.
2. Abnormal
– when debtor is forced by means of a judicial
proceeding either to comply with the prestation or
pay indemnity (4 TOLENTINO at 274-275).
CHARACTERISTICS OF A VALID
PAYMENT: (I3)
1. Identity
– only the prestation agreed upon and no other
must be complied with
2. Integrity
– the thing or service must be completely
delivered or rendered
3. Indivisibility
– payment or performance must be indivisible
(JURADO, Obligations and Contracts, supra at
247).
PRINCIPLE OF
INTEGRITY/COMPLETENESS OF
PAYMENT
A debt to deliver a thing (including money) or to
render service is not understood to have been paid
unless the thing or service has been completely
delivered or rendered, as the case may be. Partial or
irregular performance will not produce the
extinguishment of an obligation as a general rule.
Neither a late partial payment forestalls a long-
expired maturity date (Selegna Management & Dev.
Corp. v. United Coconut Planters Bank, G.R. No.
165662, May 3, 2006).
EXCEPTIONS TO PRINCIPLE OF
INTEGRITY:
1. When the obligation has been substantially
performed in good faith, the obligor may recover
as though there had been a strict and complete
fulfillment, less damages suffered by the
obligee (CIVIL CODE, Art. 1234); and
2. When the obligee accepts performance, knowing
its incompleteness or irregularity and without
expressing any protest or objection; based on the
principle of estoppel (CIVIL CODE, Art. 1235).
NOTE: This provision may be read alongside the
presumptions under Article 1176.
ELEMENTS OF SUBSTANTIAL
COMPLIANCE IN GOOD FAITH:
1. The obligor has made substantial performance,
which is determinable by the unique
circumstances of each case.
2. The obligor is in good faith (CIVIL CODE, Art.
1234)
INDIVISIBILITY OF PRESTATION
Creditor cannot be compelled partially to receive the
prestation in which the obligation consists; neither
may the debtor be required to make partial payments
(CIVIL CODE, Art. 1248).
EXCEPTIONS:
1. When the obligation expressly stipulates the
contrary (CIVIL CODE, Art. 1248, par. 1);
2. When the obligation is in part liquidated and in
part unliquidated (CIVIL CODE, Art. 1248, par.
2);
3. When the nature of the obligation is susceptible
to partial fulfilment as when:
 a. There are different prestations which are
subject to different terms or conditions; or
b. Both parties know that that obligation cannot
be reasonably expected to be performed at
one time.
4. In case of partial compensation.
INDIVISIBILITY V. INTEGRITY
There is an obligation to pay P5000.
1. Integrity refers to the extinguishment of the
obligation only upon payment of P5,000 in total.
It does not however consider if the P5,000 is
delivered in one or 2 installments.
2. The presumption of law is that any obligation is
deemed indivisible. Thus, in general, all P5,000
must be delivered in one instance of payment to
satisfy both integrity and indivisibility.
IDENTITY OF PRESTATION
“The very same thing or act must be delivered or
done”
1. Real Obligations
a. Specific Obligations
The debtor of a thing cannot compel the
creditor to receive a different one, although
the latter may be of the same value as, or
more valuable than that which is due (CIVIL
CODE, Art. 1244, par.1)
b. Generic Obligations
When the obligation consists in the delivery
of an indeterminate or generic thing, whose
quality and circumstances have not been
stated, the creditor cannot demand a thing of
superior quality. Neither can the debtor
deliver a thing of inferior quality (CIVIL
CODE, Art. 1246).
2. Personal Obligations
In obligations to do or not to do, an act or
forbearance cannot be substituted by another act
or forbearance against the obligee's will (CIVIL
CODE, Art. 1244, par. 2)
EXCEPTIONS TO THE RULE ON
IDENTITY OF PAYMENTS:
1. In case of dacion en pago, where a property is
alienated to the creditor in satisfaction of a debt
in money (CIVIL CODE, Art. 1245).
2. In case of Facultative obligations, where only one
thing is due but the debtor has reserved the right
to substitute it with another (CIVIL CODE, Art.
1206).
NOTE: In its modern concept, what actually takes
place in dacion en pago is an objective novation of
the obligation where the thing offered as an accepted
equivalent of the performance of an obligation is
considered as the object of the contract of sale, while
the debt is considered as the purchase price
(Mamerta vda. De Jayme v. CA, G.R. No. 128669,
October 4, 2002). Novation is not an exception to the
rules on payment because it is a different mode of
extinguishing obligations. Novation does not amount
to payment (See CIVIL CODE, Art. 1231).
DATION IN PAYMENT (DACION EN
PAGO)
Dation in payment, whereby property is alienated to
the creditor in satisfaction of a debt in money, shall
be governed by the law of sales (CIVIL CODE, Art
1245).
Example: If D executed a promissory note in 2021
promising to pay to C P5,000 within 4 years from the
execution of the note, and in 2024, when the
obligation became demandable, the two entered into
an agreement by virtue of which D shall deliver his
automobile to C as the equivalent of the performance
of the obligation, the effect is the transformation of the
previous contract into a contract of sale with the
automobile as the object and the loan of P5,000 as
the purchase price (JURADO, Obligations and
Contracts, supra at 246).
REQUISITES OF DACION EN PAGO:
(PDA)
1. There must be Performance of the prestation in
lieu of payment (animo solvendi) which may
consist in the delivery of a corporeal thing or a
real right or a credit against a third person;
2. There must be some Difference between the
prestation due and that which is given in
substitution (aliud pro alio); and
3. There must be an Agreement between the
creditor and debtor that the obligation is
immediately extinguished by reason of the
performance of a prestation different from that
due (Aquintey v. Tibong, G.R. No. 166704,
December 20, 2006).
DATION IS NOT A SALE
The undertaking really partakes in one sense of the
nature of sale, that is, the creditor is really buying the
thing or property of the debtor, payment for which is
to be charged against the debtor’s debt. As such, the
vendor in good faith shall be responsible, for the
existence and legality of the credit at the time of the
sale but not for the solvency of the debtor, in specified
circumstances (Lo v. KJS Eco-Formwork System
Phil., G.R. No. 149420, October 8, 2003).
NOTE: Dation in payment is NOT a sale (only
partakes of the “nature of sale”) as it is a special mode
of payment.
 SALE V. DACION EN PAGO 2. 25-centavo coin or less:
In amounts not exceeding P100.00 (Circular 537,
SALE DACION EN PAGO
Series of 2006).
As to Existence of Debt
NOTE: Notes of the Bangko Sentral, regardless of
There is no pre-existing There is pre-existing denomination, are legal tender up to whatever
credit. credit amount (See R.A. No. 7653, as amended, Sec. 52).

As to Effect INSTRUMENTS OF CREDIT ARE NOT

MONEY
Obligations are created Obligations are
1. The buyer has to extinguished Delivery of promissory notes payable to order or bills
pay the price 1. The “buyer” (creditor) of exchange or other mercantile documents shall not
2. The seller has to does not undertake produce the effect of payment (CIVIL CODE, Art.
deliver the object any obligation 1249, par. 2).
2. The “seller” (debtor)
delivers payment. Checks representing demand deposits do not have
legal tender power and their acceptance in the
payment of public and private debts is at the creditor’s
PAYMENT OF MONETARY option (R.A. No. 7653, as amended, Sec. 60).
OBLIGATIONS
The payment of debts in money shall be made in the EFFECT OF DELIVERY OF CREDIT
currency stipulated, and if it is not possible to deliver INSTRUMENTS
such currency, then in the currency which is legal In the meantime, the action derived from the original
tender in the Philippines (CIVIL CODE, Art. 1249, par. obligation shall be held in the abeyance (CIVIL
2). CODE, Art. 1249, par. 2).

All monetary obligations shall be settled in the
Philippine currency which is legal tender in the
Philippines. However, the parties may agree that the
obligation or transaction shall be settled in any other
currency at the time of payment (R.A. No. 8183, Sec.
1).
There is no longer any legal impediment to having
obligations or transactions paid in a foreign currency
as long as the parties agree to such arrangement
(DBP. v. CA, G.R. No. 138703, June 30, 2006).
NOTE: Money is a generic object. An obligation to
deliver P100 can be paid by delivering any validly
circulating Philippine legal tender with total face value
of P100 such as one 100-peso bill, or 2 50-peso bills,
or 10 10-peso coins.
LEGAL TENDER
All notes and coins issued by the BSP are fully
guaranteed by the Republic and shall be legal tender
in the Philippines for all debts, both public and private
(R.A. No. 7653, as amended, Sec. 52).
COINS CONSIDERED AS LEGAL
TENDER
Maximum amount of coins to be considered as legal
tender:
1. 1-Peso, 5-Peso and 10-Peso coins:
In amounts not exceeding P1,000.00; and
Illustration: D owes C P1M due on January 1, 2021.
On demand, D writes a check in the amount of P1M
dated February 1, 2021, delivering it on January 1,
2021. C accepted the check. Until February 1, 2021,
C cannot file an action on the ground that D is in delay
because action on the debt was held in abeyance by
the delivery and acceptance of the check dated
February 1, 2021.
WHEN DELIVERY OF CREDIT
INSTRUMENTS DEEMED PAYMENT OF
MONEY
1. When they have been cashed or credited
(collected)
a. Instruments executed by third persons and
delivered by the debtor to the creditor.
b. Note executed by the debtor himself and
delivered by the debtor to the creditor (4
TOLENTINO, supra at 301).
2. When through the fault of the creditor
they have been impaired
Credit Instruments are impaired when they are
validly discharged by some act of the creditor.
Example: By current banking practice, a check
becomes stale after more than six (6) months. In
fact a check long overdue for more than two and
one-half years is considered stale (Pacheco v.
CA, G.R. No. 1266270, December 2, 1999). Stale
check is valueless and, therefore, should not be
paid (International Corporate Bank v. Spouses
 Gueco, G.R. No. 141968, February 12, 2001).
The payee may request the drawer to issue a
new and current check in his favor to replace the
stale check or, if the drawer refuses and there
has been no prescription, the payee can pursue
a legal action to collect on the obligation of the
drawer.
EFFECT OF EXTRAORDINARY
INFLATION OR DEFLATION
In case an extraordinary inflation or deflation of the
currency stipulated should supervene, the value of
the currency at the time of the establishment of the
obligation shall be the basis of payment, unless there
is an agreement to the contrary (CIVIL CODE, Art.
1250)
INFLATION OR DEFLATION
There is inflation when there is an increase in the
volume of money and credit relative to available
goods resulting in a substantial and continuing rise in
the general price level (Huibonhoa v. CA, G.R. No.
95897, December 14, 1999).
Deflation is the reduction in volume and circulation of
the available money or credit, resulting in a decline of
the general price level; it is the opposite of inflation
(DE LEON, Obligations and Contracts, supra at 338).
REQUISITES OF EXTRAORDINARY
FLUCTUATION: (DCE)
1. There is an official Declaration of extraordinary
inflation or deflation from the Bangko Sentral ng
Pilipinas (BSP);
2. The obligation is Contractual in nature; and
3. The parties Expressly agreed to consider the
effects of the extraordinary inflation or deflation
(Equitable PCI Bank v. Sheung Ngor, G.R. No.
171545, December 19, 2007).
Even if the price index of the goods and services may
have risen during the intervening period (Sangrador
v. Valderrama, G.R. No. 79552, November 29, 1988),
this increase, without more, cannot be considered as
resulting in “extraordinary inflation” as to justify the
application of Article 1250 (Telengtan & Sons, Inc. v.
United States Lines, Inc., G.R. No. 132284, February
28, 2006).
There must be a declaration of such extraordinary
inflation or deflation by the Bangko Sentral. Without
such declaration, the creditors cannot demand an
increase, and debtors a decrease, of what is due to
or from them (Ramos v. CA, G.R. No. 119872, July 7,
1997).
WHO MAY MAKE PAYMENT
WHO MAY PAY THE OBLIGATION
The following may pay or perform the obligation:
1. The debtor himself or his legal representative;
and
2. Any third person (JURADO, Obligations and
Contracts, supra at 233; CIVIL CODE, Arts.
1236-1238).
PAYMENT MADE BY A THIRD PERSON
WHO IS AN INTERESTED PARTY
One who has an interest in the extinguishment of the
obligation, such as:
1. Co-debtors;
2. Sureties;
3. Guarantors; and
4. Owners of mortgages property (4 PARAS, supra
at 352).
NOTE: Even without the knowledge of the debtor, a
person interested in the fulfillment of the obligation
can pay (CIVIL CODE, Art. 1302, par. 3).
NOTE: The creditor cannot refuse valid tender of
payment from the abovementioned individuals
(Monte de Piedad v. Rodrigo, G.R. No. L-42928,
August 18, 1936).
EFFECTS OF PAYMENT BY INTERESTED
THIRD PERSON:
1. The obligation is extinguished (JURADO,
Obligations and Contracts, supra at 233);
2. The debtor is to fully reimburse the third person
who is an interested party; and
3. The third person interested is subrogated to the
rights of the creditor (4 PARAS, supra at 353).
PAYMENT MADE BY A THIRD PERSON
WHO IS NOT AN INTERESTED PARTY
BUT WITH DEBTOR’S CONSENT
GENERAL RULE: The creditor is not bound to
accept payment or performance by a third person
who has no interest in the fulfillment of the obligation
(CIVIL CODE, Art. 1236, par. 1).
EXCEPTION: Unless there is a stipulation to the
contrary (CIVIL CODE, Art. 1236).
EFFECTS OF AUTHORIZED PAYMENT
OF DISINTERESTED THIRD PERSON:
1. Third person is entitled to full reimbursement.
2. Third person is entitled to legal subrogation, or
the right to bring actions against the debtor as
mortgagee or against third persons, i.e. third
person steps into the shoes of the creditor (4
PARAS, supra at 360).
PAYMENT MADE BY A THIRD PERSON
WHO IS NOT AN INTERESTED PARTY
AND WITHOUT KNOWLEDGE OR
AGAINST THE WILL OF THE DEBTOR
GENERAL RULE: Whoever pays for another may
demand from the debtor what he has paid (CIVIL
CODE, Art. 1236, par. 2).
EXCEPTION: If payment was made without the
knowledge or against the will of the debtor. In such
case, he can only recover insofar as the payment has
been beneficial to the debtor, also known as
beneficial reimbursement (CIVIL CODE, Art. 1236,
par. 2; 4 PARAS, supra at 353).
EFFECT OF UNAUTHORIZED PAYMENT
BY DISINTERESTED THIRD PERSON
1. Third person can only be reimbursed insofar as
payment has been beneficial to the debtor (4
PARAS, supra at 353).
If debt or obligation has been previously
extinguished TOTALLY then the third person who
pays without knowledge/consent of the debtor
would not be able to recover anything from the
latter (JURADO, Obligations and Contracts,
supra at 236).
Remedy: Third person may proceed against the
creditor who was unduly paid, applying the
principle of unjust enrichment (Id. at 236).
If debt or obligation has been previously
extinguished PARTIALLY then third person who
pays would be able to recover only that part of
the amount which he has paid which corresponds
to the part of the obligation not yet extinguished
(beneficial reimbursement (Id. at 236).
NOTE: From the viewpoint of the debtor, the
provision of the law that the third person or payor
“can recover only insofar as the payment has
been beneficial to the debtor,” when made
against his express will, and is a defense
personal to the debtor. In order to be subject to
the said limitation, debtor must oppose payment
before or at the time the same was made (Id. at
236).
2. Third person cannot compel the creditor to
subrogate him in his rights, such as those arising
from a mortgage, guaranty, or penalty paid
(CIVIL CODE, Art. 1237).
SUBROGATION
The person who pays for the debtor is put into the
shoes of the creditor. The payer acquires not only the
right to be reimbursed for what he has paid but also
all other rights which the creditor could have
exercised pertaining to the credit either against the
debtor or against third persons, be they guarantors or
possessors of mortgages subject to stipulation in a
conventional subrogation (CIVIL CODE, Art. 1303).
In subrogation, however, there is no real extinction of
the obligation, but only a change of creditor (DE
LEON, Obligations and Contracts, supra at 310).
REIMBURSEMENT
The third person entitled by reason of payment has
merely the bare right to be refunded to the extent
provided in the second paragraph of Art. 1236 without
the right to the guarantees and securities of the
original obligation. In subrogation, however, there is
no real extinction of the obligation, but only a change
of creditor (DE LEON, Obligations and Contracts,
supra at 310).
PAYMENT MADE BY A THIRD PERSON
WHO DOES NOT INTEND TO BE
REIMBURSED BY THE DEBTOR
(GRATUITOUS PAYMENTS)
1. Presumed to be a donation. Therefore, the
consent of the debtor is necessary, as in the case
of a donee in ordinary donations;
2. Once the consent of the debtor is secured, the
rules on ordinary donations will apply;
3. If the consent is not secured, Arts. 1236 and 1237
will apply; and
4. As far as the creditor who has accepted the
payment is concerned, the debtor’s consent is
immaterial; the payment is valid in any case
(JURADO, Obligations and Contracts supra at
238).
FREE DISPOSAL OF THING DUE AND
CAPACITY TO ALIENATE REQUIRED
In obligations to give, payment by one who does not
have the free disposal of the thing due and capacity
to alienate it is not valid (CIVIL CODE, Art. 1239).
TO WHOM PAYMENT MADE
TO WHOM PAYMENT MUST BE MADE
1. The person in whose favor the obligation has
been constituted;
2. His successor in interest; or
NOTE: The debtor who, before having
knowledge of the assignment of a credit to a third
person, pays the original creditor, shall be
released from the obligation (CIVIL CODE, Art.
1626).
3. Any person authorized to receive it (CIVIL CODE,
Art. 1240).
 NOTE: Person authorized to receive payment
refers not only to a person authorized by the
creditor, but also to a person authorized by law to
do so (JURADO, Obligations and Contracts
supra at 240).
EFFECT OF PAYMENT TO THE WRONG
PERSON
When payment is made to the wrong party, the
obligation is not extinguished as to the creditor who
is without fault or negligence even if the debtor acted
in utmost good faith and by mistake as to the person
of the creditor or through error induced by fraud of a
third person (Allied Banking Corp. v. Lim Sio Wan,
G.R. No. 133179, May 27, 2008).
EXCEPTIONS:
1. Payment made to a third person but which has
redounded to the benefit of the creditor (CIVIL
CODE, Art. 1241, par. 2); and
2. Payment made in good faith to any person in
possession of the credit shall release the debtor
(CIVIL CODE, Art. 1242).
NOTE: The “possession” referred to in Article
1242 is possession of the credit itself and not
merely of the document or instrument evidencing
the credit. Hence, mere possession of the
instrument (unless transferable by delivery) does
not entitle the holder to payment nor does
payment release the debtor (DE LEON,
Obligations and Contracts, supra at 317).
THE DEBTOR IS RELIEVED FROM
PROVING BENEFIT TO THE CREDITOR
IN CASE OF:
1. Subrogation of the payer in the creditor’s rights
after the payment;
2. Ratification by the creditor of the payment to the
third person; or
3. Estoppel on the part of the creditor (CIVIL CODE,
Art. 1241 par. 2).
NOTE: In such cases, the benefit to the creditor is to
be presumed. Through estoppel, an admission or
representation is rendered conclusive upon the
person making it and cannot be denied or disproved
as against the person relying thereon (CIVIL CODE,
Art. 1431).
PAYMENT TO INCAPACITATED
PERSONS
Payment to a person who is incapacitated to
administer his property shall be valid if he has kept
the thing delivered, or insofar as the payment has
been beneficial to him.
Payment made to a third person shall also be valid
insofar as it has redounded to the benefit of the
creditor (CIVIL CODE, Art. 1241).
PAYMENT AFTER JUDICIAL ORDER OF
RETENTION
Payment made to the creditor by the debtor after the
latter has been judicially ordered to retain the debt
shall not be valid (CIVIL CODE, Art. 1243).
Such payment must be made to the proper officer of
the court issuing the writ of attachment or
garnishment in conformity with the provisions of the
Rules of Court (JURADO, Obligations and Contracts,
supra at 244).
GARNISHMENT
The proceeding for the purpose of subjecting a
debtor’s credit to the payment of his debt to another.
It is an attachment by means of which the plaintiff
seeks to subject to his claim the property of the
defendant in the hands of a third person or money
owed by such third person or garnishee to the
defendant (Manila Remnant Co., Inc. v. CA, G.R. No.
107282, May 16, 1994).
OTHER ELEMENTS OF PAYMENT
EXPENSES OF PAYMENT
Unless it is otherwise stipulated, the extrajudicial
expenses required by the payment shall be for the
account of the debtor. With regard to judicial costs,
the Rules of Court shall govern (CIVIL CODE, Art.
1247).
REASON: The debtor is the one principally benefitted
as he is freed from the obligation by reason of the
payment (PINEDA, Obligations and Contracts,
(2009), p. 278 [hereinafter PINEDA, Obligations and
Contracts]).
If the debtor changes his domicile in bad faith or after
he has incurred in delay, the additional expenses
shall be borne by him (CIVIL CODE, Art. 1251).
JUDICIAL COSTS
Judicial costs are the statutory amounts allowed to a
party to an action for his expenses incurred in the
action.
The costs of an action shall, as a rule, be paid by the
losing party (RULES OF COURT, Rule 142, Sec. 1).
The court may, however, for special reasons, adjudge
that either party shall pay the costs, or that the same
be divided, as may be equitable.
No costs are allowed against the Government, unless
otherwise provided by law (DE LEON, Obligations
and Contracts, supra at 325).

PLACE OF PAYMENT
1. Place stipulated by the parties;
2. If there is no stipulation and the obligation is to
deliver a determinate thing, payment shall be
made at the place wherever the thing might be at
the time the obligation was constituted; or
3. In any other case, the payment shall be made at
the domicile of the debtor (CIVIL CODE, Art.
1251).
NOTE: The order as above enumerated is
successive and exclusive as may be gleaned from
the provision itself (DE LEON, Obligations and
Contracts, supra at 347).
Art. 1251 governs unilateral obligations. Reciprocal
obligations are governed by special rules (JURADO,
Obligations and Contracts, supra at 267).
APPLICATION OF PAYMENTS
Designation of the debt to which the payment must
be applied when the debtor has several obligations of
the same kind in favor of the same creditor (CIVIL
CODE, Art. 1252).
NOTE: “Application of payments” is not a “special
mode of payment” but a set of rules as to how a
specific tender of payment shall be applied in cases
where a debtor is indebted under several obligations
to the same creditor.
Example: D borrowed P500 from C on January 1,
2021. He borrowed another P300 from C on February
1, 2021. These two loans are distinct obligations.
Thus, following the general rules, if D pays P300 to C
on March 1, 2021, the tender of payment must apply
to partially extinguish the first loan and not to totally
extinguish the second loan.
REQUISITES: (OSDI)
1. There must be only One debtor and only one
creditor
NOTE: This requisite does not exclude solidary
debts.
2. There must be two or more debts of the Same
kind;
3. All the debts must be Due; and
EXCEPTIONS:
a. When there is a stipulation to the contrary
b. The application of payment is made by the
party for whose benefit the term or period has
been constituted (CIVIL CODE, Art. 1196).
4. Amount paid by the debtor is Insufficient to cover
the total amount of all the debts (JURADO,
Obligations and Contracts, supra at 268).
NOTE: Otherwise, there would be no necessity
of designating the debts to which payment shall
be applied (Id. at 268).
RULES ON APPLICATION OF PAYMENT
1. The debtor has the first choice; he must indicate
at the time of making payment, and not
afterwards, which particular debt is being paid. If,
in making use of his right, the debtor applied the
payment to a debt, he cannot later claim that it
should be applied to another debt (DE LEON,
Obligations and Contracts, supra at 349);
NOTE: The right is available to him only at the
time when payment is made. If he does not
exercise such right, the same is extinguished and
the application would then be governed by the
provisions of Art. 1254, unless the creditor, in the
meantime, makes the application by giving to the
debtor, who accepts it, a receipt in which
application of the payment is made (JURADO,
Obligations and Contracts, supra at 271).
2. The right once exercised is irrevocable unless the
creditor consents (JURADO, Obligations and
Contracts, supra at 270);
3. If the creditor has not also made the application,
or if the application is not valid, the debt, which is
most onerous to the debtor among those due,
shall be deemed to have been satisfied (CIVIL
CODE, Art. 1254, par. 1);
4. If the debts due are of the same nature and
burden, the payment shall be applied to all of
them proportionately (CIVIL CODE, Art. 1254,
par. 2); and
5. If neither party has exercised its option and there
is disagreement as to debts to which payment
must be applied, the court will apply the payment
according to the justice and equity of the case,
taking into consideration all its circumstances
(Premiere Development Bank v. Central Surety &
Insurance Co., G.R. No. 176246, February 13,
2009).
NOTE: If the debtor does not apply, the creditor may
designate which debt is paid by specifying in the
receipt. Thus, the creditor has the right to propose
subject to the express or tacit approval of the debtor
(JURADO, Obligations and Contracts, supra at 271).
Limitations:
1. Creditor cannot be compelled to accept partial
payments (CIVIL CODE, Art. 1248, par. 1);
2. Generally, application of payment should be on
the interest first (CIVIL CODE, Art. 1253);
3. Debtor cannot apply payment to a debt that is not
yet liquidated (CIVIL CODE, Art. 1248, par. 2);
4. Debtor cannot choose a debt with a period for the
benefit the creditor when the period has not yet
arrived (CIVIL CODE, Art. 1252);
5. When there is an agreement as to the debts
which should be paid first, debtor cannot vary the
agreement (CIVIL CODE, Art. 1252).
INTEREST EARNED PAID AHEAD OF
PRINCIPAL
If the debt produces interest, payment of the principal
shall not be deemed to have been made until the
interests have been covered (CIVIL CODE, Art.
1253).
Art. 1253 applies only in the absence of a verbal or
written agreement to the contrary; in other words, it is
merely directory, and not mandatory. It means that
the benefits of Art. 1253 may be waived by way of
stipulation (Baltazar v. Lingayen Gulf Elec. Power
Co., G.R. No. L-16236, June 30, 1965).
NOTE: The rule under Article 1253 that payments
shall first be applied to the interest and not to the
principal shall govern if two facts exist: (1) the debt
produces interest (e.g., the payment of interest is
expressly stipulated) and (2) the principal remains
unpaid. The exception is a situation covered under
Article 1176, i.e., when the creditor waives payment
of the interest despite the presence of (1) and (2)
above. In such case, the payments shall obviously be
credited to the principal (Marquez v. Elisan Credit
Corp. G.R. No. 194642, April 6, 2015).
LEGAL APPLICATION OF PAYMENT
The debt which is most onerous to the debtor, among
those due, shall be deemed to have been satisfied
(CIVIL CODE, Art. 1254).
THE RULE APPLIES:
1. When the payment cannot be applied in
accordance with the preceding rules; or
2. If the application cannot be inferred from the
circumstances (JURADO, Obligations and
Contracts, supra at 272).
REASON FOR RULE ON THE MOST
ONEROUS DEBT IN APPLICATION OF
PAYMENTS
In making the application of payments, the law
considers particularly the interest of the debtor. It is
assumed that if the debtor had chosen the debt to be
paid, he would have relieved himself first of the most
burdensome debt.
WHICH IS MORE ONEROUS:
1. Oldest debts are more onerous than more recent
ones;
2. Interest bearing debts are more onerous than
those which do not, even if the latter were
incurred at an earlier date;
3. Between interest bearing debts, the debt with a
higher rate of interest is more onerous;
4. A secured debt is more onerous than that which
is not;
5. A debt in which the debtor is principally bound is
more onerous than that which he is merely a
guarantor or surety;
6. A debt in which he is solidarily bound is more
onerous than that which he is only a sole debtor;
7. Within a solidary obligation, the share which
corresponds to a solidary debtor would be most
onerous;
8. An obligation for indemnity is more onerous than
that which is by way of penalty; or
9. Liquidated debts are more onerous than
unliquidated ones (JURADO, Obligations and
Contracts, supra at 273-274).
NOTE: No hard and fast rule, however, can be put up
(4 PARAS, supra at 415).
REMEDY IF ONEROUSNESS NOT
CLEARLY DETERMINABLE
When it is fairly impossible to determine which of the
debts due is the most onerous or burdensome to the
debtor, or when the debts due are of the same nature
and burden, payment shall be applied proportionately
(JURADO, Obligations and Contracts, supra at 274).
Illustration: Applying both rules, should a debtor
have two debts of the same nature and burden
amounting to P100 and P200 and he pays only P100,
the same shall not be applied proportionately as the
creditor cannot be compelled to accept partial
payment. Consequently, his payment shall be fully
applied to the debt amounting to P100.
SPECIAL FORMS OF PAYMENT
There are three special forms of payment under the
CIVIL CODE, namely:
1. Dation in payment (CIVIL CODE, Art. 1245);
2. Payment by cession (CIVIL CODE, Art. 1255);
3. Tender of payment and consignation (CIVIL
CODE, Arts. 1256-1261).
PAYMENT BY CESSION
It is the process by which a debtor transfers all the
properties not subject to execution in favor of his
creditors so that the latter may sell them, and thus
apply the proceeds to their credits (4 PARAS citing
Manresa and Castan, supra at 417).
The debtor may cede or assign his property to his
DATION IN PAYMENT BY
creditors in payment of his debts. This cession,
PAYMENT CESSION
unless there is stipulation to the contrary, shall only
release the debtor from responsibility for the net Debtor is not Debtor must be partially
proceeds of the thing assigned. The agreements necessarily in state of or relatively insolvent.
which, on the effect of the cession, are made between financial difficulty.
the debtor and his creditors shall be governed by
special laws (CIVIL CODE, Art. 1255). As to Object

Requisites: (PMIAA) Thing delivered is Universality of property

1. Plurality of debts; considered as of debtor is what is
2. More than one creditor; equivalent of ceded.
3. Partial or relative Insolvency of the debtor performance.
4. Abandonment of all debtor’s property not exempt
from execution (unless exemption is validly As to Effect
waived by debtor) in favor of creditors; and
5. Acceptance of the cession by the creditors Extinguishes obligation Merely releases debtor
(JURADO, Obligations and Contracts, supra at to the extent of the for net proceeds of things
275). value of the thing ceded or assigned,
delivered as agreed unless there is contrary
upon, or as may be intention.
REMEDY IN CASE CREDITORS REFUSE proved, unless the
CESSION silence of the parties
In case the creditors do not accept the cession or signifies that they
assignment, a similar result may be obtained by consider the thing as
proceeding in accordance with the Financial the equivalent of the
Rehabilitation and Insolvency Act (FRIA) (R.A. No. performance of the
10142). obligation.

NOTE: Under the FRIA, all of the assets of an As to the Extent of Properties Involved
insolvent debtor are pooled and then sold for the
benefit of the creditors in general. Does not involve all Involves all the
properties of debtor. properties of the debtor.
EFFECT OF ASSIGNMENT IN CESSION As to the Effect to the Creditor
Unless there is a stipulation to the contrary, the
assignment does not make the creditors the owners Creditor becomes Creditor does not
of the property of the debtor and the debtor is owner of property of become the owner.
released from his obligation only up to the net debtor. Possession is only
proceeds of the sale of the property assigned (CIVIL transmitted.
CODE, Art. 1255).
(JURADO, Obligations and Contracts, supra at 275-
276).
NOTE: Cession only authorizes the creditors to sell
the properties ceded for their benefit in a public sale.
It is not a transfer of ownership to their name. If the TENDER OF PAYMENT
property is transferred to them, it is dation, not Consists in the manifestation made by the debtor to
cession (JURADO, Obligations and Contracts, supra the creditor of his decision to comply immediately with
at 275). his obligation (Id. at 277).

DATION IN PAYMENT V. PAYMENT BY Tender of payment, even if valid, does not by itself
produce legal payment, unless it is completed by
CESSION consignation (Phil. National Bank v. Relativo, G.R.
DATION IN PAYMENT BY No. L-5298, October 29, 1952).
PAYMENT CESSION
Requisites of a Valid Tender of Payment
As to Number of Parties 1. Tender of payment must comply with the rules on
payment (CIVIL CODE, Arts. 1256-1258).
One creditor. Plurality of creditors. 2. It must be unconditional and for the whole
amount.
As to Financial Condition of Parties
3. It must be actually made (DE LEON, Obligations
and Contracts, supra at 362-363).
 TWIN ACTS TO PRODUCE EFFECT OF
CONSIGNATION PAYMENT
It is the act of depositing the thing due with the court Both tender of payment and consignation must be
or judicial authorities whenever the creditor cannot validly done in order to effect the extinguishment of
accept or refuses to accept payment and it generally an obligation. Substantial compliance is not enough
requires a prior tender of payment (PINEDA, for that would render only a directory construction of
Obligations and Contracts, supra at 266; Insular Life the law (DE LEON, Obligations and Contracts, supra
Assurance Company, Ltd. v. Toyota Bel-Air, Inc., at 360).
G.R. No. 137884, March 28, 2008).
INSTANCES WHERE CONSIGNATION
Requisites of Consignation (CIVIL CODE, Arts.
1256-1258)
SHALL PRODUCE THE EFFECTS OF
The requisites of consignation are the following: (DT- PAYMENT WITHOUT PRIOR TENDER OF
NDN) PAYMENT: (AIR-CL)
1. A Debt is due; 1. Creditor is Absent or unknown, or does not
2. The creditor to whom Tender of payment was appear at the place of payment.
made refused without just cause to accept the 2. Creditor is Incapacitated to receive the payment
payment, or the creditor was absent, unknown or at the time it is due.
incapacitated, or several persons claimed the 3. When without just cause, the creditor Refuses to
same right to collect, or the title of the obligation give a receipt (tender was actually made)
was lost; 4. When two or more persons Claim the same right
3. The person interested in the performance of the to collect (as in the case of interpleader).
obligation was given Notice before consignation 5. When the title of the obligation has been Lost
was made [Prior or First Notice]; (CIVIL CODE, Art. 1256, par. 2).
4. The amount was placed at the Disposal of the
court; and PREPARATORY ACTS FOR
5. The person interested in the performance of the
obligation was given Notice after the
CONSIGNATION
consignation was made [Final Notice] (Dalton v. 1. First or Prior notice of intent to consign the thing
FGR Realty and Development Corporation, G.R. due.
No. 172577, January 19, 2011). 2. The rules on payment must be complied with
(integrity, indivisibility, identity, etc.) (CIVIL
TENDER OF PAYMENT CODE, Art. 1257).
V. CONSIGNATION
EFFECT IF NOTICE OF CONSIGNATION
TENDER OF CONSIGNATION NOT MADE
PAYMENT
In the absence of prior notice to the persons
As to Description interested in the fulfillment of the obligation (such as
guarantors, mortgagees, solidary debtors, solidary
Manifestation of the Deposit of the object of creditors), the consignation, as payment, shall be
debtor to the creditor of the obligation in a void (Valdellon v. Tengco, G.R. No. L-52326,
his decision to comply competent court in February 23, 1986).
immediately with his accordance with the rules "All interested parties are to be notified of the
obligation. prescribed by law, after consignation. Compliance with this requisite is
refusal or inability of the mandatory."
creditor to accept the
tender of payment. In Valdellon v. Tengco, the Court held that: Under Art.
1257 of our CIVIL CODE, in order that consignation
As to the Act Involved of the thing due may release the obligor, it must first
be announced to the persons interested in the
Preparatory act. Principal act. fulfillment of the obligation. The consignation shall be
ineffectual if it is not made strictly in consonance with
As to Character
the provisions which regulate payment. In said Article
Extrajudicial in Judicial in character. 1258, it is further stated that the consignation having
character. been made, the interested party shall also be notified
thereof (Dalton v. FGR Realty and Development
(JURADO, Obligations and Contracts, supra at 277- Corporation, G.R. No. 172577, January 19, 2011).
278).
Tender of payment and notice of consignation may
be done in the same act, e.g., sending a letter that
should the creditor fail to accept the payment
tendered, the debtor would consign the amount in
court (Ramos v. Sarao, G.R. No. 149756, February
11, 2005).
CONSIGNATION WITH PROPER
JUDICIAL AUTHORITY
Consignation shall be made by depositing the things
due at the disposal of judicial authority, before whom
the tender of payment shall be proved, in a proper
case, and the announcement of the consignation in
other cases (CIVIL CODE, Art. 1258).
Consignation, by depositing the thing or sum due with
the proper judicial authority (i.e., court), is necessary
to effect payment. It cannot be elsewhere (e.g., bank)
unless otherwise prescribed by special law (e.g., P.D.
No. 25, re rental).
FINAL NOTICE
The consignation having been made, the interested
parties shall also be notified thereof (CIVIL CODE,
Art. 1258).
NOTE: There is completed consignation only upon
notice. However, the effect of payment retroacts to
the time the thing due is placed in the disposal of the
court (4 TOLENTINO, supra at 331-332).
LIABILITY OF CREDITOR FOR
EXPENSES OF CONSIGNATION.
The expenses of consignation, when properly made,
shall be charged against the creditor (CIVIL CODE,
Art. 1259).
NOTE: The expenses are chargeable to the debtor if
the consignation is not properly made (DE LEON,
Obligations and Contracts, supra at 371).
EFFECTS OF CONSIGNATION:
1. If the creditor accepts the thing or amount
deposited without contesting the validity or
efficacy of the consignation, the obligation is
cancelled/extinguished (CIVIL CODE, Art. 1261).
2. If the creditor contests the validity of the
consignation or if the creditor is not interested or
unknown or is absent, the result is litigation. If
during the trial, the plaintiff-debtor is able to
establish that all the requisites of consignation
have been complied with, the obligation is
extinguished (JURADO, Obligations and
Contracts, supra at 287).
EXERCISE OF RIGHT OF REPURCHASE
In case of exercise of right of repurchase by tender of
check, such tender is valid because it is an exercise
of a right and not made as a mode of payment of an
obligation. Article 1249 is not applicable (Adelfa
Properties, Inc., v. CA, G.R. No. 111238, January 25,
1995).
NOTE: Consignation is not required.
EFFECTS OF WITHDRAWAL OF THE
OBJECT/AMOUNT DEPOSITED:
1. Before creditor has accepted consignation or
before a judicial declaration of consignation:
a. Obligation remains in force.
b. Withdrawal by the debtor at this stage is a
matter of right because he still owns the thing
(CIVIL CODE, Article 1260, par. 2).
Q: Should the debtor opt not to withdraw the thing
at this stage, can another creditor attach the
same property since the debtor still owns the
thing?
A: No. Property deposited with court is exempt
from attachment and not subject to execution; it
is said to be in custodia legis and cannot be
withdrawn without an express order from the
court (DE LEON, Obligations and Contracts,
supra at 370).
2. With consent of the creditor:
a. Creditor loses every preference which he
may have over the thing;
b. Solidary co-debtors, guarantors and sureties
are released;
c. Solidary debtors are released only from their
solidary liability but not from their shares of
their obligation; and
d. The obligation is revived, but without
prejudice to other interested parties (CIVIL
CODE, Art. 1261).
NOTE: Withdrawal by the debtor at this stage is
a matter of privilege (4 PARAS, supra at 434).
NOTE: To have the effect of payment, the law
requires the twin acts of tender of payment and
consignation. Tender of payment without
consignation only frees the debtor from the
obligation to pay interest on the outstanding
amount from the time the unjustified refusal takes
place (Go Cinco v. CA, G.R. No. 151903, October
9, 2009).
LOSS OF THE THING DUE
LOSS OF THE THING DUE
It is understood that the thing is lost when it perishes,
or goes out of commerce or disappears in such a way
that its existence is unknown or it cannot be
recovered (CIVIL CODE, Art. 1189, par. 2).
EFFECT OF LOSS IN DETERMINATE
OBLIGATION TO GIVE
GENERAL RULE: Loss of a determinate thing
through fortuitous event shall extinguish the
obligation (CIVIL CODE, Art. 1262).
REQUISITES: (DFD)
1. The thing which is lost must be Determinate;
2. The thing is lost without any Fault of the debtor;
and
3. The thing is lost before the debtor has incurred in
Delay (JURADO, Obligations and Contracts,
supra at 288).
EXCEPTIONS:
1. When the law so provides;
2. When the stipulation so provides;
3. When the nature of the obligation requires an
assumption of risk;
4. Loss of the thing occurs after the debtor incurred
in delay (CIVIL CODE, Art. 1262);
5. Loss of the thing is partly due to the fault of the
debtor (Limpangco V. Yangco Steamship, G.R.
No. L-10283, July 25, 1916);
6. When the debtor promised to deliver the same
thing to two persons who do not have the same
interest (CIVIL CODE, Art. 1165, par. 3);
7. When the obligation to deliver arises from a
criminal offense (CIVIL CODE, Art. 1268); and
8. When the obligation is generic (CIVIL CODE, Art.
1263).
If the loss is through theft, the debtor is considered
negligent having placed the thing within the reach of
thieves and not in a secure and safe place. Hence,
the debtor will be liable for damages. In theft, taking
is accomplished without the use of violence or force
(4 TOLENTINO, supra at 337).
LOSS OF GENERIC THINGS
The obligation is generic if the object thereof is
designated merely by its class or genus without any
particular designation or physical segregation from all
others of the same class (JURADO, Obligations and
Contracts, supra at 290).
GENERAL RULE: Loss of generic thing does not
extinguish obligation (CIVIL CODE, Art. 1263). Thus,
the debtor can still be compelled to deliver a thing
which must be neither of superior nor inferior quality
(CIVIL CODE, Art. 1246).
REASON: Based upon the principle that the genus of
a thing can never perish (genus nunquam perit)
(JURADO, Obligations and Contracts, supra at 290).
EXCEPTIONS:
1. Limited Generic Thing
– When there is a limitation of the generic object
to a particular existing mass or a particular group
of things, the obligation is extinguished by the
loss of the particular mass or group or limited
quantity from which the prestation has to be
taken, or by the impossibility of getting from it the
things for prestation (4 TOLENTINO, supra at
340-341).
Example: Cattle or horses of a certain ranch or
the sugar in a certain warehouse (JURADO,
Obligations and Contracts, supra at 290). If all are
lost, the obligation is extinguished.
2. Case of the Genus “goes out of
commerce”
– The obligation to deliver that generic object is
extinguished.
Example: Before the delivery of truckloads of
tobacco as an obligation, a legislation is passed
prohibiting selling of tobacco. Obligation to
supply or deliver such tobacco is thus
extinguished.
EFFECT OF PARTIAL LOSS
There is partial loss when only a portion of the thing
is lost or destroyed or when it suffers depreciation or
deterioration. Partial loss is the equivalent of difficulty
of performance in obligations to do (See CIVIL
CODE, Art. 1267) (DE LEON, Obligations and
Contracts, supra at 345).
GENERAL RULE: Partial loss does not extinguish
the obligation (CIVIL CODE, Art. 1264).
EXCEPTION: When the partial loss or destruction of
the thing is of such importance that would be
tantamount to a complete loss or destruction
(JURADO, Obligations and Contracts, supra at 291).
NOTE: In case of partial loss, the court is given the
discretion, in case of disagreement between the
parties, to determine whether under the
circumstances it is so important in relation to the
whole as to extinguish the obligation. In other words,
the court will decide whether the partial loss is such
as to be equivalent to a complete or total loss (DE
LEON, Obligations and Contracts, supra at 345).
RULE IF THE THING IS IN DEBTOR’S
POSSESSION
GENERAL RULE: If the thing is lost while in the
possession of the debtor, it shall be presumed that
the loss was due to his fault, unless there is proof to
the contrary and without prejudice to the provisions of
Art. 1165 of the CIVIL CODE (CIVIL CODE, Art. contemplated by the parties; otherwise, the same
1265). may extinguish the obligation under Art. 1267. In the
latter case, the fact that the prestation later becomes
EXCEPTION: No such presumption in case of possible does not revive the obligation (Id. at 346).
earthquake, flood, storm or other natural calamity.
DOCTRINE OF UNFORESEEN EVENTS/
EFFECT OF IMPOSSIBILITY OF DOCTRINE OF FRUSTRATION OF
PERFORMANCE IN OBLIGATION TO DO ENTERPRISE/ THEORY OF
When the obligation becomes legally or physically IMPREVISIBILITY
impossible without the fault of the debtor, obligor is When the service has become so difficult as to be
released from the obligation (CIVIL CODE, Art. manifestly beyond the contemplation of the parties,
1266). the court should be authorized to release the obligor
in whole or in part (CIVIL CODE, Art. 1267).
WHEN IMPOSSIBILITY SHOULD OCCUR
TO HAVE EFFECT OF EXTINGUISHMENT The parties stipulate in the light of certain prevailing
The impossibility must have occurred after the conditions and once these conditions cease to exist,
constitution of the obligation in order that it may be the contract also ceases to exist. Considering
extinguished. If impossibility was present before the practical needs and the demands of equity and good
obligation was constituted, there would be an faith, the disappearance of the basis of the contract
obligation which would be ineffective from its gives rise to a right to relief in favor of the party
inception (CIVIL CODE, Art. 1348). prejudiced (Naga Telephone Co., et al. v. CA, G.R.
No. 107112, February 24, 1994).
NATURAL IMPOSSIBILITY V.
NOTE: Article 1267 is similar to the common law
IMPOSSIBILITY IN FACT concept of rebus sic stantibus (Things thus standing).
NATURAL IMPOSSIBILITY IN
IMPOSSIBILITY FACT INTENTION OF PARTIES
As to the Thing
DETERMINATIVE
The intention of the parties should govern and if it
Must consist in the In the absence of appears that the service turns out to be so difficult as
nature of the thing to be inherent impossibility in to have been beyond their contemplation, it would be
done and not the the nature of the thing doing violence to the intention to hold the obligor still
inability of the party to stipulated to be responsible (JURADO, Obligations and Contracts,
do so. performed, which is only supra at 295-296).
improbable or out of the
power of the obligor. “SERVICE” REFERS TO A PRESTATION
The law speaks of "service." This term should be
As to the Effect understood as referring to the performance of an
Renders the contract Does not render the obligation or a prestation (Sps. Poon v. Prime savings
void. contract void. Bank, G.R. No. 183794, June 13, 2016).

(Jose De Leon v. Asuncion Soriano, G.R. No. L-2724,
August 24, 1950)
Natural impossibility is reckoned from the time of
constitution of the obligation. Thus, the obligation
remains void even if the prestation subsequently
becomes possible.
In case of subsequent partial impossibility, the rule in
Art.1264 of the CIVIL CODE may be applied (4
TOLENTINO, supra at 345).
IS ARTICLE 1267 LIMITED TO
PERSONAL OBLIGATIONS?
Yes. Article 1267 is limited only to personal
obligations. It speaks of a “service,”- a personal
obligation. Thus, real obligations are not within its
scope (4 PARAS, supra at 439). Justice Jurado
however is of the opinion that the word “service”
should be understood as referring to the
“performance” of the obligation (JURADO,
Obligations and Contracts, supra at 296).

Temporary impossibility does not extinguish the
obligation but merely delays its fulfillment, unless by
its nature or by the will of the parties it has to be
performed at a determinate time. This presupposes
that the duration of impossibility has been
It is not a requirement under Art. 1267 that the
contract be for future service with future unusual
change (Naga Telephone Co., et al. v. CA, G.R. No.
107112, February 24, 1994).
PRINCIPLE OF SUBJECTIVE
IMPOSSIBILITY
When there is no physical or legal loss but the object
of the obligation belongs to another, the performance
by the debtor of the obligation undoubtedly becomes
impossible. Failure of performance is imputable to the
debtor. Thus, the debtor must indemnify the creditor
for the damages suffered by the latter (4
TOLENTINO, supra at 336).
EFFECT OF LOSS IN RECIPROCAL
OBLIGATIONS
1. First view: Res Perit Domino
If an obligation is extinguished by the loss of the
thing or impossibility of performance through
fortuitous events, the counter-prestation is also
extinguished. The debtor is released from liability
but he cannot demand the prestation which has
been stipulated for his benefit. He who gives
nothing has no reason to demand (Id. at 337-
338).
2. Second view: Res Perit Creditori
The loss or impossibility of performance must be
due to the fault of the debtor. In this case, the
injured party may ask for rescission under Article
1191 plus damages. If the loss or impossibility
was due to a fortuitous event, the other party is
still obliged to give the prestation due to the other
(J.B.L. Reyes).
NOTE: The better view is Res Perit Domino
RULE IF OBLIGATION ARISES FROM
CRIMINAL OFFENSE
GENERAL RULE: Debtor shall not be exempted
from the payment of the price whatever may be the
cause for the loss (CIVIL CODE, Art. 1268).
NOTE: The rule is applicable not only to the persons
who are principally liable, but also to those who are
subsidiarily liable (JURADO, Obligations and
Contracts, supra at 297).
EXCEPTION: When the thing having been offered by
the debtor to the person who should receive it, the
latter refused without justification to accept it (CIVIL
CODE, Art. 1268; JURADO, Obligations and
Contracts, supra at 297).
NOTE: The offer referred in Article 1268 should not
be confused with consignation; the latter refers only
to the payment of the obligation, the former refers to
the extinguishment of the obligation through loss by
fortuitous event (JURADO, Obligations and
Contracts, supra at 296-297).
NOTE: When the offer is made by the debtor and the
creditor refuses to accept it without justification, he
may choose either of two courses:
1. He may make a consignation of the thing and
thereby completely relieve himself of further
liability, or
2. He may keep the thing in his possession, in which
case, the obligation shall still subsist but with this
difference — that if the thing is lost through a
fortuitous event, Arts. 1262 and 1265, and not
Art. 1268, shall govern.
It must, of course, be noted that this Article 1268 can
have no application to those cases where an offer is
not possible, since such offer by the debtor is an
essential requisite (JURADO, Obligations and
Contracts, supra at 297).
EFFECT OF EXTINGUISHMENT BY LOSS
OR IMPOSSIBILITY
The obligation having been extinguished by the loss
of the thing, the creditor shall have all the rights of
action which the debtor may have against the third
persons by reason of the loss (CIVIL CODE, Art.
1269).
NOTE: There is no need for an assignment by the
debtor. The rights of action of the debtor are
transferred to the creditor from the moment the
obligation is extinguished, by operation of law to
protect the interest of the latter by reason of the loss
(DE LEON, Obligations and Contracts, supra at 399).
CONDONATION OR
REMISSION
CONDONATION OR REMISSION OF
DEBT
An act of liberality by virtue of which the obligee,
without receiving any price or equivalent, renounces
the enforcement of the obligation, as a result of which
it is extinguished in its entirety or in that part or aspect
of the same to which the remission refers.
It is the gratuitous abandonment by the creditor of his
right; a form of donation (JURADO, Obligations and
Contracts, supra at 298).
REQUISITES OF REMISSION: (GADCIF)
1. It must be Gratuitous;
2. It must be Accepted by the obligor (bilateral act);
3. The obligation must be Demandable;
4. Parties must have the Capacity;
5. Not Inofficious (DE LEON, Obligations and
Contracts, supra at 367); and
6. Must comply with the Forms of donation should it
be express (CIVIL CODE, Arts. 748 and 749).
KINDS OF REMISSION OR
CONDONATION
1. As to Form
a. Express – when it is made in accordance
with the formalities prescribed by law for
donations.
b. Implied – when, although it is not made in
accordance with the formalities prescribed by
law for donations, it can be deduced from the
acts of the obligee or creditor.
2. As to Extent
a. Total – when the entire obligation is
extinguished.
b. Partial – when it refers only to the principal
or to the accessory obligation or to an aspect
thereof which affects the debtor (as for
instance solidarity).
3. As to Constitution
a. Inter Vivos – when it is constituted by
agreement of the obligee and the obligor
which shall be effective during their lifetime.
b. Mortis Causa – when it is constituted by last
will and testament (JURADO, Obligations
and Contracts, supra at 298-299).
REMISSION IS A FORM OF DONATION
Whether express or implied, the extent of remission
or condonation shall be governed by the rules
regarding inofficious donation (CIVIL CODE, Art.
1270, par. 2).
It is an essential characteristic of remission that it be
gratuitous -- there is no equivalent received for the
benefit given because from the moment it exists, the
nature of the act is changed, and becomes some
other form of extinguishment such as:
1. Dation in payment(CIVIL CODE, Art. 1245);
2. Cession(CIVIL CODE, Art. 1255);
3. Novation(CIVIL CODE, Art. 1291); or
4. Compromise (CIVIL CODE, Art. 2028).
APPLICATION OF THE RULES ON
DONATION
Condonation or remission is essentially a donation of
credit to the debtor. It must be subject to the rule on
donations with respect to acceptance (CIVIL CODE,
Art. 745 and 746), amount (CIVIL CODE, Art. 750 and
752) and revocation (CIVIL CODE, Art. 760, 761, 764
and 765); (4 TOLENTINO, supra at 364).
EFFECT OF LACK OF CONSENT OF
DEBTOR IN REMISSION
The creditor renounces his credit even against the will
of the debtor because Article 6 of the CIVIL CODE
provides that “Rights may be waived, unless the
waiver is contrary to law, public order, public policy,
morals or good customs, or prejudicial to a third
person with a right recognized by law.”
However, since the debtor did not accept the
remission, the creditor merely waived his right to
demand the obligation. In which case, the debt will
remain outstanding until it prescribes or unless it is
extinguished in some other manner. The creditor will
merely be in mora accipiendi and “suffer” the legal
consequences of his refusal to receive payment.
WHEN RENUNCIATION OF ACTION
AGAINST THE DEBTOR IS PRESUMED
If the creditor voluntarily delivers the private
document evidencing the credit to the debtor, there is
a presumption that he renounces his right of action
against the latter for the collection of the said credit
(CIVIL CODE, Art. 1271). When such private
document is found in possession of the debtor, it shall
be presumed that the creditor delivered it voluntarily,
unless the contrary is proved (CIVIL CODE, Art.
1272).
REQUISITES OF IMPLIED
CONDONATION OR REMISSION OF
DEBT: (DPV)
1. That the document evidencing the credit must
have been Delivered by the creditor to the debtor;
2. That the document must be a Private document;
and
3. That the delivery must be Voluntary (CIVIL
CODE, Art. 1271; JURADO, Obligations and
Contracts, supra at 307).
When the obligation is joint, and the private document
evidencing a debt is found in the possession of one
of the debtors, the presumption of remission can refer
only to the portion of the debtor who is in the
possession of the instrument. If the obligation is
solidary, Arts. 1215, 1219 and 1220 shall apply (DE
LEON, Obligations and Contracts, supra at 404).
RULES WHEN ACCESSORY
OBLIGATIONS ARE INVOLVED
If the remission refers to the principal obligation, all
the accessory obligations are extinguished.
However, if remission refers only to the accessory
obligation, the principal obligation continues to
subsist (CIVIL CODE, Art. 1273).

CONFUSION OR
MERGER
CONFUSION
It is the merger of the characters of the creditor and
the debtor in one and the same person by virtue of
which the obligation is extinguished (CIVIL CODE,
Art. 1275).
Illustration of Confusion/Merger
Atoy makes a check payable to bearer, and hands it
to Joey, who hands it to Kaye who finally hands it to
Atoy. Here Atoy owes himself and thus, his obligation
is extinguished.
If, however, the reason for the confusion ceases, the
obligation is revived. Thus, should Kaye deliver the
note to Atoy in the performance of a void obligation,
Atoy’s obligation is recreated. But the time
intervening between the merger and its revocation is
not to be computed in the determination of the period
for prescription.
REQUISITES OF MERGER: (MPC)
1. Merger of the characters of the creditor and
debtor must be in the same person (CIVIL
CODE, Art. 1275);
2. Must take place in the person of either the
Principal creditor or the principal debtor (CIVIL
CODE, Art.1276); and
3. Whether the merger refers to the entire obligation
or only part thereof, there must be Complete and
definite meeting of all qualities of creditor and
debtor in the obligation or in the part thereof
affected by the merger (JURADO, Obligations
and Contracts, supra at 307; Testate Estate of
Mora v. Serra, G.R. No. L-34581, March 31,
1932; Valmonte v. CA, G.R. No. L-41621,
February 18, 1990).
NOTE: The requisite that the merger of rights of
creditor and debtor must be complete and definite
means that whether the merger refers to the entire
obligation or only a part thereof, it must be of such a
character that there will be a complete and definite
meeting of all of the qualities of creditor and debtor in
the obligation or in the part or aspect thereof which is
affected by the merger (JURADO, Obligations and
Contracts, supra at 307).
EFFECTS OF CONFUSION/MERGER:
1. If confusion takes place in the person of
either the principal creditor or principal
debtor
– extinguishment of entire obligation; or
2. If confusion takes place in the person of
a subsidiary creditor or subsidiary debtor
(e.g. guarantor)
– no extinguishment of principal obligation; only
substitution of creditor or debtor; or
3. If confusion takes place in one of the joint
debtors – principal obligation is
extinguished up to the share which
corresponds to him; or
4. If confusion takes place in one of the
solidary debtors
– entire obligation is extinguished. However, the
debtor in whom confusion took place may claim
reimbursement from co-debtors for the shares
which correspond to them (CIVIL CODE, Art.
1276-1277; JURADO, Obligations and Contracts,
supra at 308-309).
COMPENSATION
COMPENSATION
Mode of extinguishing in the concurrent amount of the
obligation of those persons who are reciprocally
debtors and creditors of each other (JURADO,
Obligations and Contracts, supra at 309, citing
CASTAN).
Illustration:
A owes B the amount of P1,000.00; B owes A the
amount of P700.00; Both debts are due and payable
today. Here compensation takes place partially, that
is, to the concurrent amount of P700.00. So, A shall
be liable to B for only P300.00. If the two debts are of
the same amount, there is total compensation (See
CIVIL CODE, Art. 1281).
The two debts are extinguished without actual
transfer of money between the parties (DE LEON,
Obligations and Contracts, supra at 380).
COMPENSATION V. CONFUSION
COMPENSATION CONFUSION
As to the Number of Persons
Only one person in whom
Two persons who, in
the qualities of debtor
their own right, are
and creditor are merged
creditors and debtors of
each other
 COMPENSATION CONFUSION REQUISITES OF COMPENSATION:
(PS-DL-NoNo)
As to the Number of Obligations 1. There must be two (2) Parties, who, in their own
right, are principal creditors and principal debtors
There must be at least There is only one of each other (CIVIL CODE, Art. 1279) except in
two obligations obligation case of a guarantor (CIVIL CODE, Art. 1280);
As to Payment
2. Both debts must consist in Sum of money, or if
There is indirect There is impossibility of the things due are fungibles (consumables), they
payment. payment must be of the same kind and quality (CIVIL
CODE, Art. 1279);
(DE LEON, Obligations and Contracts, supra at 416-
417). GENERAL RULE: Compensation is not possible
in obligations to do because of the difference in
COMPENSATION V. PAYMENT the respective capacities of the obligors (Id. at
317).
COMPENSATION PAYMENT

As to Requisites 3. Both debts must be Due (CIVIL CODE, Art.

1279);
The requisites prescribed by law for compensation
are different from those prescribed by law for EXCEPTION: Voluntary compensation or the
payment. parties may nevertheless agree upon the
compensation of the obligations (CIVIL CODE,
As to How it Takes Effect Art. 1282).

Takes effect by Takes effect by act of the
operation of law parties
As to Necessity of Capacity to Give
Capacity to give and to Capacity to give and to
acquire is not acquire is essential
necessary
As to Divisibility
As a rule, law permits As a rule, complete and
partial extinguishment indivisible
of obligation
(JURADO, Obligations and Contracts, supra at 310).
KINDS OF COMPENSATION:
1. As to Cause
a. Legal – takes effect by operation of law from
the moment all of the requisites are present;
b. Voluntary – when parties who are mutually
creditors and debtors agree to compensate
their respective obligations, even though all
of the requisites for compensation may not
be present;
c. Judicial – takes effect by judicial decree; or
d. Facultative – when it can be set up only by
one of the parties.
2. As to Effect
a. Total – debts to be compensated are equal
in amount; or
b. Partial – debts to be compensated are not
equal in amount (Id. at 311).
4. Both debts must be Liquidated and demandable
(CIVIL CODE, Art. 1279);
Liquidated Debts – those amount of which may
be determined by a simple arithmetical operation
(Id.).
5. There must be No retention or controversy
commenced by third persons over either of the
debts and communicated in due time to the
debtor (CIVIL CODE, Art. 1279); and
NOTE: Retention consists in the application of
the credit of one of the parties to the satisfaction
of the claims of third persons while controversy
refers to a case in which a third person claims to
be the creditor (Id. at 318).
6. The compensation must Not be prohibited by law
(CIVIL CODE, Art. 1279).
Legal compensation takes effect by operation of law
only when all the requisites mentioned in article 1279
have concurred (Union Bank of the Philippines v.
Development Bank of the Philippines, G.R. No.
191555, January 20, 2014).
RIGHT OF GUARANTOR TO SET-UP
COMPENSATION
The guarantor, in case the payment of the debt is
demanded from him, may set up compensation, not
only for what the creditor owes him, but also for what
the creditor owes the principal debtor (CIVIL CODE,
Art. 1280).
NOTE: This article is an exception to the general rule
that only the principal debtor can set up against his
creditor what the latter owes him (DE LEON,
Obligations and Contracts, supra at 394).
TOTAL COMPENSATION
– results when the two debts are of the same amount.
If they are of different amounts, compensation is total
as regards the smaller debt, and partial only with
respect to the larger debt (CIVIL CODE, Art. 1281).
VOLUNTARY COMPENSATION
The parties may agree upon the compensation of
debts which are not yet due.
Example: If the obligation of A is pure, while the
obligation of B is with a term or period which has not
yet expired, the general rule is that there can be no
compensation because B’s obligation is not yet due.
However, the parties may nevertheless agree upon
the compensation of the two obligations (JURADO,
Obligations and Contracts, supra at 319).
REQUISITES OF VOLUNTARY OR
CONVENTIONAL COMPENSATION:
1. Each of the parties has the right to dispose of the
credit he seeks to compensate; and
2. They agree to the mutual extinguishment of their
credits (CKH Industrial & Development Corp. v.
CA, G.R. No. 111890, May 7, 1997).
JUDICIAL COMPENSATION
If one of the parties to a suit over an obligation has a
claim for damages against the other, the former may
set it off by proving his right to said damages and the
amount thereof (CIVIL CODE, Art. 1283).
“Judicial Compensation” is Not Contemplated by
CIVIL CODE
In reality, what is set off against the other party is a
counterclaim. “A counterclaim must be pleaded to be
effectual; whereas, a compensation takes place by
mere operation of law.’’ Hence, the counterclaim
defined by the Rules of Court is not the legal
compensation contemplated by the Code. This is so,
because by its very nature, a set off or counterclaim
can have no effect unless it is pleaded.
In addition, the claim is not liquidated; consequently,
compensation cannot take place. It is converted into
a liquidated claim by court decree, in which case
compensation shall take effect from the moment the
judgment liquidating the claim has become final
(RULES OF COURT, Rule 6, Sec. 6 ;JURADO,
Obligations and Contracts, supra at 319).
RULE IN CASE OF RESCISSIBLE OR
VOIDABLE DEBTS
When one or both debts are rescissible or voidable
obligations may be compensated against each other
before they are judicially rescinded or avoided (CIVIL
CODE, Art. 1284).
REASON: Rescissible and voidable obligations are
valid until they are judicially rescinded or avoided.
Prior to rescission or annulment, the debts may be
compensated against each other (DE LEON,
Obligations and Contracts, supra at 433).
EFFECTS OF ASSIGNMENT OF RIGHTS:
1. If with consent of debtor
– debtor cannot set-up compensation unless he
reserved his right to compensation;
2. If with knowledge but without consent of
debtor
– debtor may set-up compensation prior to the
assignment but not subsequent ones; or
3. If without knowledge of the debtor
– may set-up compensation of all credits which
he may have against the assignor and which may
have become demandable, before he was
notified of the assignment (CIVIL CODE, Art.
1285).
DEBTS WHICH CANNOT BE
COMPENSATED:
1. Debts arising from contracts of
depositum;
A deposit is constituted from the moment a
person receives a thing belonging to another with
the obligation of safely keeping it and of returning
the same (CIVIL CODE, Art. 1962).
NOTE: Article 1287 uses the word depositum
instead of “deposit” which is used for an ordinary
bank deposit. A bank deposit is not a depositum.
It is really a loan which creates the relationship of
debtor and creditor (DE LEON, Obligations and
Contracts, supra at 400).
2. Debts arising from contracts of
commodatum;
Commodatum is a gratuitous contract whereby
one of the parties delivers to another something
not consumable so that the latter may use the
same for a certain time and return it (CIVIL
CODE, Art. 1933).
3. Claims for support due by gratuitous title;
Support comprises everything that is
indispensable for sustenance, dwelling, clothing,
medical attendance, education and
 transportation, in keeping with the financial EFFECT OF COMPENSATION
capacity of the family” (FC, Art. 194). When all the requisites mentioned in Article 1279 are
present, compensation takes effect by operation of
4. Obligations arising from criminal law, and extinguishes both debts to the concurrent
offenses (CIVIL CODE, Art. 1288); and amount, even though the creditors and debtors are
not aware of the compensation (CIVIL CODE, Art.
5. Certain obligations in favor of 1290).
government (e.g., taxes, fees, duties, and
others of a similar nature (CIVIL CODE, Art. NOTE: As it takes place by mere operation of law,
1286-1287). and without any act of the parties, it is not required
that the parties have full legal capacity (CIVIL CODE,
WHEN COMPENSATION TAKES Art. 37) to give or to receive, as the case may be. On
EFFECT: the other hand, in order that there may be a valid
payment, the parties must have the free disposal of
1. Legal Compensation the thing due and capacity to alienate it (CIVIL
– from the moment all the essential requisites CODE, Art. 1239) and to receive payment (CIVIL
prescribed by law are present (CIVIL CODE, Art. CODE, Arts. 1240-1241), as the case may be (DE
1290); LEON, Obligations and Contracts, supra at 440-441).

2. Voluntary Compensation FACULTATIVE COMPENSATION

– from the moment agreed upon by the parties
(CIVIL CODE, Art. 1282); or
3. Judicial Compensation
– from the moment the judgment becomes final
and executor (CIVIL CODE, Art. 1283); or
4. Facultative Compensation
– from the moment when legal compensation
cannot take place (4 TOLENTINO, supra at 367)
Compensation which can be set up only at the option
of the creditor when legal compensation cannot take
place because of want of some legal requisites for the
benefit of the creditor. The latter can renounce his
right to oppose the compensation and he himself can
set it up. It differs from conventional compensation
because it is unilateral while the latter depends upon
the agreement of both parties (4 TOLENTINO, supra
at 367).

COMPENSATION WHERE DEBTS

PAYABLE AT DIFFERENT PLACES
Compensation takes place by operation of law, even
though the debts may be payable at different places,
but there shall be an indemnity for expenses of
exchange or transportation to the place of payment
(CIVIL CODE, Art. 1286).
The indemnity contemplated above does not refer to
the difference in the value of the things in their
respective places but to the expenses of monetary
exchange (in case of money debts) and expenses of
transportation (in case of things to be delivered).
Once these expenses are liquidated, the debts also
become compensable (DE LEON, Obligations and
Contracts, supra at 436).
RULES ON APPLICATION OF
PAYMENTS APPLICABLE TO ORDER OF
COMPENSATION
If a debtor has various debts which are susceptible of
compensation, he must inform the creditor which of
them shall be the object of compensation. In case he
fails to do so, then the compensation shall be applied
to the most onerous obligation (CIVIL CODE, Arts.
1252 & 1254).
NOVATION
NOVATION
It is the substitution or change of an obligation by
another, resulting in its extinguishment or
modification, either by changing its object or principal
conditions, or by substituting another in place of the
debtor, or by subrogating a third person in the rights
of the creditor (CIVIL CODE, Art. 1291).
REQUISITES OF NOVATION: (PCASV)
1. Previous valid and existing obligation;
2. Capacity of the contracting parties (to the new
contract);
3. Animus novandi or intent to novate (especially for
implied novation and substitution of debtors);
4. Substantial difference between the old obligation
and the new obligation (especially for implied
novation), consequently, extinguishment of the
obligation; and
5. Validity of the new obligation (JURADO,
Obligations and Contracts, supra at 326).
There can be no novation unless two distinct and
successive binding contracts take place, between the
same parties with the second designed to replace the
preceding convention. Modifications introduced
before a bargain becomes obligatory can in no sense
constitute novation in law. A loan application, before
bank approval, cannot be subsequently novated
because the first requisite, a pre-existing obligation,
is lacking (Azolla Farms v. CA, G.R. No. 138085,
November 11, 2004).
A CONTRACT “REVIVING” A
PRESCRIBED DEBT
A new contract, recognizing and assuming a
prescribed debt is a valid novation. The defense of
prescription of the right to demand payment may be
waived by the debtor. Even after the obligation has
prescribed, it subsists as a moral obligation (CCC
Insurance Corp. v. Kawasaki Steel Corp., G.R. No.
156162, June 22, 2015).
TWO-FOLD PURPOSE OF NOVATION:
1. Original obligation is extinguished; and
2. A new obligation is created (JURADO,
Obligations and Contracts, supra at 326).
KINDS OF NOVATION:
1. As to its Essence
a. Objective/Real – when the object (or cause)
or principal conditions of the obligation are
changed (CIVIL CODE, Art. 1291, par. 1);
b. Subjective/Personal – substitution of debtor
or by subrogation (CIVIL CODE, Art. 1291,
par. 2 & 3);
c. Mixed – change in the object or principal
condition and change in the persons of either
creditor and debtor of an existing obligation
(CIVIL CODE, Art. 1291).
2. As to its Form/Constitution
a. Express – when it is declared in unequivocal
terms that the old obligation is extinguished
by a new one which substitutes the same.
b. Implied – when the old and new are
incompatible with each other on every point
(JURADO, Obligations and Contracts, supra
at 327).
3. As to Extent/Effect
a. Total
b. Partial (JURADO, Obligations and
Contracts, supra at 327).
4. As to its Origin
a. Legal — that which takes place by operation
of law (CIVIL CODE, Arts. 1300, 1302); or
b. Conventional — that which takes place by
agreement of the parties (CIVIL CODE, Arts.
1300, 1301; DE LEON, Obligations and
Contracts, supra at 408).
WAYS OF EFFECTING CONVENTIONAL
NOVATION: (EI)
1. New obligation expressly declares that the old is
Extinguished; or
2. New obligation is on every point Incompatible
with the old one (Ajax Marketing & Development
Corp. v. CA, G.R. No. 118585, September 14,
1995).
NOVATION IS NEVER PRESUMED
Novation is never presumed. Unless it is clearly
shown either by express agreement of the parties or
by acts of equivalent import, this defense will never
be allowed (Ong v. Bogñalbal, G.R. No. 149140,
September 12, 2006 citing Aboitiz v. De Silva, G.R.
No. 21036, April 5, 1924).
Thus, to effect an objective novation, it is imperative
that the new obligation expressly declares that the old
obligation is thereby extinguished, or that the new
obligation be on every point incompatible with the
new one. In the same vein, to effect a subjective
novation by a change in the person of the debtor, it is
necessary that the old debtor be released expressly
from the obligation and the third person or new debtor
assumes his place in the relation. There is no
novation without such release as the third person who
assumed the debtor’s obligation becomes merely a
co-debtor or surety (Ajax Marketing & Dev’t. Corp. v.
CA, G.R. No. 118585, September 14, 1995).
NOTE: “Implicit” Novation does not mean that the
parties did not expressly agree to novate. It means
that the parties expressly agreed to a new obligation
which is incompatible with the old obligation such that
even if the parties did not “expressly” state that the
new obligation was intended to novate the old
obligation, novation exists.
IMPLIED CONSENT BY THE CREDITOR
ALLOWED
The aforecited article 1205 of the Old Civil Code (now
Art. 1293) does not state that the creditor's consent
to the substitution of the new debtor for the old be
express, or given at the time of the substitution, and
the Supreme Court of Spain, in its judgment of June
16, 1908, construing said article, laid down the
doctrine that "article 1205 of the Old Civil Code does
not mean or require that the creditor's consent to the
change of debtors must be given simultaneously with
the debtor's consent to the substitution; its evident
purpose being to preserve the creditor's full right, it is
sufficient that the latter's consent be given at any time
and in any form whatever, while the agreement of the
debtors subsists." The rule that this kind of novation,
like all others, must be express, is not absolute; for
the existence of the consent may well be inferred
from the acts of the creditor, since volition may as well
be expressed by deeds as by words. The creditor's
express consent is necessary in order that there may
be a novation of a contract by the substitution of
debtors, the impression of the word "express" does
not convey to be given an unqualified meaning (Asia
Banking Corporation v. Elser, G.R. No. 30266, March
25, 1929).
TEST OF INCOMPATIBILITY
Whether or not the old and new obligations can stand
together, each having its own independent existence.
If they can stand together, there is no incompatibility
hence, no novation. If they cannot stand together,
there is incompatibility; consequently, there is
novation (JURADO, Obligations and Contracts, supra
at 333).
NOTE: The incompatibility must affect any of the
essential elements of the obligation, such as its
object, cause or principal conditions thereof;
otherwise, the change is merely modificatory in
nature and insufficient to extinguish the original
obligation (Heirs of Servando Franco v. Sps.
Gonzales, G.R. No. 159709, June 27, 2012).
OBJECTIVE NOVATION
According to Castan, objective novation is effected
by:
1. Changing the cause of the obligation;
2. Changing the object of the obligation; or
Changing the principal or essential conditions of the
obligation (CIVIL CODE, Art. 1291, par.1).
EFFECT OF MODIFICATIONS OF
ORIGINAL OBLIGATION
1. Slight modifications and variations
– When made with the consent of the parties,
they do not abrogate the entire contract and the
rights and obligations of the parties thereto, but
the original contract continues in force except as
the altered terms and conditions of the obligation
are considered to be the essence of the
obligation itself (DE LEON, Obligations and
Contracts, supra at 418).
NOTE: The change must involve the “principal”
conditions of the obligation (CIVIL CODE, Art.
1291, par. 1).
Examples:
a. The acceptance of a partial payment by a
creditor before the maturity of the obligation
is not a novation of the contract but a waiver
of the period agreed upon during which
payment should not be made (DE LEON,
Obligations and Contracts, supra at 419).
b. The obligation to pay a sum of money is not
novated by an instrument that expressly
recognizes the old, changes only the terms of
the payment, adds other obligations not
incompatible with the old ones or the new
contract merely supplements the old contract
(Sps. Reyes v. BPI Family Savings Bank, GR
No. 149841-41, March 31, 2006).
c. The grant of a 45-day credit extension does
not novate the contract as it merely modifies
the contract by extending the time for
payment (Foundation Specialists, Inc., v.
Betonval Ready Concrete, Inc., G.R. No.
170674, August 24, 2009).
d. A change in the rate of interest is merely a
collateral agreement between the creditor
and principal debtor that did not affect the
surety. The agreement to pay the additional
interest was an additional burden upon the
debtor only. It did not in any way affect the
original contract. Thus, despite the
compounding of the interest, the liability of
the surety remains only up to the original
uncompounded interest (Garcia, Jr. v. CA,
G.R. No. L-80201, November 20, 1990).
2. Material deviations or changes.
– Where the original contract is deviated from in
material respects so that the object or principal
condition cannot reasonably be recognized as
that originally contracted for, the original contract
should be treated as abandoned (DE LEON,
Obligations and Contracts, supra at 421).
Examples:
a. Debt restructuring such that the former
principal and accrued interests are
established as a new principal amount of
debt over which a new interest rate is
applied.
b. A contract of mortgage over a parcel of land
to secure a loan is converted into a contract
of antichresis.
EFFECTS OF NOVATION UPON
ACCESSORY OBLIGATIONS
GENERAL RULE: When the principal obligation is
extinguished in consequence of a novation,
accessory obligation may subsist only insofar as they
may benefit third persons who did not give consent
(CIVIL CODE, Art. 1296).
EXCEPTION: Art. 1296 has no application to
novation effected by subrogating a third person to the
rights of the creditor. Such novation is regulated by
Arts. 1303-1304 of the CIVIL CODE (8 MANRESA,
5th Ed., Bk. 1, p. 792).
The exception refers to a case in which there is a
stipulation constituted in favor of a third person, which
may be demanded separately from the principal
obligation, although subordinated to the latter (e.g.
stipulation pour autrui) (JURADO, Obligations and
Contracts, supra at 346).
EFFECT WHERE THE NEW OBLIGATION
VOID
If the new obligation is void, the original one shall
subsist, unless the parties intended that the former
relation should be extinguished in any event (CIVIL
CODE, Arts. 1297).
If the new obligation is only voidable, novation can
take place. But the moment it is annulled, the
novation must be considered as not having taken
place, and the original one can be enforced, unless
the intention of the parties is otherwise (DE LEON,
Obligations and Contracts, supra at 474).
EFFECT WHERE THE OLD OBLIGATION
VOID OR VOIDABLE
If the original obligation was subject to a suspensive
or resolutory condition, the new obligation shall be
under the same condition, unless it is otherwise
stipulated (CIVIL CODE, Arts. 1298).
NOTE: If the condition is suspensive, and it is not
complied with, no obligation arises; and if it is
resolutory and it is complied with, the old obligation is
extinguished. In either case, one requisite of
novation, i.e., a previous valid obligation, would be
wanting (DE LEON, Obligations and Contracts, supra
at 474).
EFFECTS OF CONDITION IN NOVATION:
1. If the original obligation was subject to
suspensive or resolutory condition, the new
obligation shall be under the same condition,
unless otherwise stipulated (CIVIL CODE, Art.
1299).
2. If the new obligation and the old obligation are
subject to different conditions:
a. If the conditions can stand together:
i. If both are fulfilled – the new obligation
becomes demandable
ii. If only the condition affecting the old
obligation is fulfilled – old obligation is
revived while the new obligation loses its
force.
iii. If only the condition affecting the new
obligation is fulfilled – there is no
novation since the requisite of a previous
valid and effective obligation would be
lacking.
b. If the conditions are incompatible – the effect
is to extinguish the old obligation so that only
the new obligation remains and whose
demandability/effectivity depend upon the
fulfillment/non-fulfillment of the condition
affecting it (JURADO, Obligations and
Contracts, supra at 348-349).
SUBJECTIVE NOVATION
NOVATION BY SUBSTITUTION OF
DEBTORS
A subjective/personal novation consists in the
substitution of a new debtor in place of the original
debtor, which may be made even without the
knowledge or against the will of the latter, but not
without the consent of the creditor (CIVIL CODE, Art.
1293).
FORMS OF NOVATION BY
SUBSTITUTION OF DEBTORS:
1. Expromisión
– effected with the consent of the creditor at the
instance of the new debtor even without the
consent or even against the will of the old debtor
(beneficial reimbursement).
Requisites:
a. Initiative for substitution must emanate from
the new debtor;
b. Consent of the creditor to the substitution;
and
c. Old debtor must be released from obligation
(JURADO, Obligations and Contracts, supra
at 339).
Illustration: Atoy owes Eugene P1,000. Joey, a
friend of Atoy approaches Eugene and tells him:
“I will pay you what Atoy owes you. From now on,
consider me your debtor. Atoy is to be excused.”
Take note that in this example, there is an
agreement that Atoy will be released from the
obligation. Sans such agreement, there is no
novation and the creditor (Eugene) can still
enforce the obligation against the original debtor
(Atoy).
Note: Implied consent by the creditor is allowed
(Asia Banking Corporation v. Elser, G.R. No. L-
30266, March 25, 1929).
Kinds of Substitution by Expromisión:
a. Substitution with the knowledge and consent
of the old debtor; and
b. Substitution without the knowledge or
against the will of the old debtor (JURADO,
Obligations and Contracts, supra at 339).
2. Delegación
– effected with the consent of the creditor
(delegatario) at the instance of the old debtor
 (delegante), with the concurrence of the new
debtor (delegado) (reimbursement and
subrogation).
Requisites:
a. Initiative for substitution must emanate from
the old debtor;
b. Consent of the new debtor;
c. Acceptance by the creditor; and
d. Old debtor must be released from his
obligation (Id.).
Illustration: Atoy owes Eugene P1,000. Atoy
texted Eugene that his friend Joey will pay the
debt, and he wishes to be released from the
obligation. Both Joey and Eugene agreed to such
terms. Take note again that the substitution must
be made with the intention to release the original
debtor.
Parties in delegacion:
a. Delegante – original debtor (Atoy);
b. Delegatario – the creditor (Eugene); and
c. Delegado – the new debtor (Joey)
NOTE: In either of the two modes of substitution, the
consent of the creditor is an indispensable
requirement (Quinto v. People, G.R. No. 126712,
April 14, 1999).
RIGHTS OF NEW DEBTOR:
1. Expromisión
a. Substitution with knowledge and consent of
original debtor and payment made by new
debtor with or without knowledge and
consent of original debtor:
i. Reimbursement from the original debtor
of the entire amount paid
ii. Subrogation in all the rights of the
creditor
b. Substitution without the knowledge and
consent of the original debtor, and payment
is made by the new debtor without the
knowledge and consent of the original
debtor:
i. Reimbursement from the original debtor
only insofar as the payment has been
beneficial to such debtor
ii. No subrogation
2. Delegación
– Since substitution was effected with the
consent of all the parties, the new debtor can
demand reimbursement from the original debtor
of the entire amount which he has paid as well as
compel the creditor to subrogate him to all of his
rights (JURADO, Obligations and Contracts,
supra at 343-344).
NOTE: The mere fact that the creditor receives a
guaranty or accepts payment from a third person
who agrees to assume the obligation, when there
is no agreement that the first debtor shall be
released from responsibility, does not constitute
novation, and the creditor can still enforce the
obligation against the original debtor. If the older
debtor is not released, there is no novation; the
third person becomes merely a co-debtor, surety
or co-surety (Mercantile Insurance Co., Inc. v.
CA, GR No. 85647, April 22, 1991).
EFFECT OF INSOLVENCY OR NON-
FULFILLMENT BY THE NEW DEBTOR
1. Expromisión
– If the substitution was effected without the
knowledge and against the will of the original
debtor, the new debtor’s insolvency or
nonfulfillment shall not revive the original debtor’s
liability to the creditor.
If the substitution was effected with the
knowledge and consent of the original debtor, it
shall revive the original debtor’s liability to the
creditor (JURADO, Obligations and Contracts,
supra at 345).
2. Delegación
– The right of the creditor can no longer be
revived except in the following cases:
a. Insolvency already existing and of public
knowledge at the time when the original
debtor delegated his debt
b. Insolvency was already existing and known
to the original debtor when he delegated his
debt (JURADO, Obligations and Contracts,
supra at 345).
It is submitted that actual knowledge of the
creditor that new debtor was insolvent at the
time of delegation, will bar him from
recovering from the old debtor. He must bear
the consequences of his acts knowingly done
(CIVIL CODE, Arts. 1294-1295).
NOVATION BY SUBROGATION
A personal novation effected by subrogating a third
person in the rights of the creditor either legal or
conventional. (CIVIL CODE, Art. 1300).
Subrogation is the substitution of one person in the
place of another with reference to a lawful claim or
right, so that he who is substituted succeeds to the
right of the other in relation to a debt or claim,
including its remedies and securities. It contemplates
full substitution such that it places the party
subrogated in the shoes of the creditor, and he may
use all means which the creditor could employ to
enforce payment. (Lorenzo Shipping Corp. v. Chubb
and Sons, G.R. No. 147724, June 8, 2004).
FORMS OF NOVATION BY CONVENTIONAL ASSIGNMENT OF
SUBROGATION: SUBROGATION RIGHTS
1. Conventional
– takes place by agreement of the original As to Time of Effectivity
creditor, the third person substituting the original
The effects arises from As far as the debtor is
creditor, and the debtor (CIVIL CODE, Art. 1301).
the moment of concerned, arises from
novation/ subrogation. the moment of
2. Legal
notification.
– takes place by operation of law (CIVIL CODE,
Art. 1302). (JURADO, Obligations and Contracts, supra at 350).

CONSENT OF ALL PARTIES REQUIRED IN LEGAL SUBROGATION

CONVENTIONAL SUBROGATION GENERAL RULE: Legal subrogation is not
1. The debtor presumed (CIVIL CODE, Art. 1302).
— because he becomes liable under the new
obligation to a new creditor. EXCEPTIONS: (PAI)
1. When a creditor pays another creditor who is
2. The old or original creditor Preferred, without debtor’s knowledge;
— because his right against the debtor is
extinguished. Illustration: Atoy has two creditors, Mhik who is
a mortgage creditor for P15,000 and Jerome who
3. The new creditor is an ordinary creditor for P6,000. Jerome paid
— because he may dislike or distrust the debtor Atoy’s debt of P15,000 to Mhik. Jerome will be
(DE LEON, Obligations and Contracts, supra at subrogated to the rights of Mhik. This means that
434). Jerome will now be a mortgage creditor for
P15,000 and an ordinary creditor for P6,000.
CONVENTIONAL SUBROGATION V. 2. When a third person, not interested in the
ASSIGNMENT OF RIGHTS obligation, pays with the express or tacit
CONVENTIONAL ASSIGNMENT OF Approval of the debtor; or
SUBROGATION RIGHTS
Illustration: Atoy owes Joey P10,000 secured by
As to Rules Which Shall Govern mortgage. Eugene, a classmate of Atoy, and
having no connection with the contract paid Joey
Governed by Art. Governed by Art. 1624- with Atoy’s approval. Subrogation takes place
1300-1304. 1627. and Eugene becomes a mortgage creditor.

As to Necessity of Debtor’s Consent If Eugene pays without the knowledge or against

the will of Atoy, he is only entitled to demand
Debtor’s consent is not
Debtor’s consent is reimbursement as to the extent that Atoy has
required to fully produce been benefited by the payment. There is no
required.
the legal effect. subrogation in this case.
As to Effect upon Obligation
3. When, even without knowledge of the debtor, a
Has the effect of Has the effect of person Interested in the fulfillment of the
extinguishing the transmitting the rights of obligation pays, without prejudice to the effects of
obligation and giving the creditor to another confusion as to the latter’s share (CIVIL CODE,
rise to a new one. person without modifying/ Art. 1302).
extinguishing the
obligation. Illustration: Joey owes Cath P10,000 secured
by a mortgage and by a guaranty of Atoy. If Atoy
even without Joey’s knowledge pays Cath, Atoy
As to Effect upon Vices will be subrogated in Cath’s place. By reason of
confusion, or by reason of the fact that Atoy
Defects/ vices in the Defects/ vices in the old became a guarantor and a creditor at the same
old obligation are obligation are not cured. time, the guaranty is extinguished.
cured.
Strictly speaking, there is no legal subrogation
when a solidary debtor pays the entire obligation.
 Solidarity terminates upon the payment of the after a contract has been entered into. Hence, there
whole obligation. Thus, the paying debtor does can be no contract if there is no obligation. But an
not completely step into the shoes of the creditor, obligation may exist without a contract (DE LEON,
as he cannot demand from any of his co-debtors Obligations and Contracts, supra at
the compliance of the entire obligation but only 444).
the proportion which pertains to each (JURADO,
Obligations and Contracts, supra at 352).

EFFECTS OF SUBROGATION GENERAL PROVISIONS

(CIVIL CODE, ART. 1303-1304) (ARTS. 1305-1355)
1. Total subrogation
– Transfers to the person subrogated the credit
with all the rights the original creditor had, either
against the debtor or third persons be they ELEMENTS OF CONTRACTS:
guarantors or possessors of mortgages.
1. Essential
– those without which there can be no contract
Accessory obligations are not extinguished; the
a. Common elements – present in all contracts
person subrogated acquires all the rights the
i. Consent
original creditor had against third persons and the
ii. Object or Subject Matter
rule is absolute with respect to legal subrogation.
iii. Cause or Consideration
In conventional subrogation, accessory
b. Special elements – present only in certain
obligations may be increased or reduced upon
contracts (e.g., delivery in real contracts or
agreement of the parties (JURADO, Obligations
form in solemn ones).
and Contracts, supra at 353).
c. Extraordinary elements – peculiar to specific
contracts (e.g., price in a contract of sale)
2. Partial subrogation
– A creditor, to whom partial payment has been
2. Natural
made, may exercise his right for the remainder,
– those which are derived from the nature of the
and he shall be preferred to the person who has
contract and ordinarily accompany the same;
been subrogated in his place in virtue of the
they are presumed by law, although they can be
partial payment of the same credit.
excluded by the contracting parties if they so
desire (e.g., warranty against eviction in a
Illustration: Atoy owes Eugene P4,000. With the
contract of sale).
consent of both, Joey pays Eugene P2,000. Now
Eugene and Joey are the creditors of Atoy to the
amount of P2K. By reason of the preferential right 3. Accidental
to the remainder, Eugene is to be preferred in – those which exist only when the parties
case Atoy has only P2,000. The preference, expressly provide for them for the purpose of
however, enjoyed by Eugene is only in the assets limiting or modifying the normal effects of the
remaining with the debtor (Atoy) and not those contract (e.g. conditions, terms or modes)
already transferred to others. (JURADO, Obligations and Contracts, supra at
357).

NOTE: Contracts must not be confused with other

CONTRACTS juridical conventions such as marriage, adoption and
succession. The principal source of the rights and
obligations of the parties in contracts is their
agreement, while in the other juridical conventions, it
is the law itself (Id. at 354).
CONTRACT
A contract is a meeting of minds between two ESSENTIAL ELEMENTS OF A VALID
persons whereby one binds himself, with respect to
CONTRACT
the other, to give something or to render some
service (CIVIL CODE, Art. 1305). There is no contract unless the following requisites
concur: (COC)
1. Consent of the contracting parties;
CONTRACT AND OBLIGATION 2. Object certain which is the subject matter of the
DISTINGUISHED contract; and
While a contract is one of the sources of obligations, 3. Cause of the obligation which is established
an obligation is the legal tie or relation itself that exists (CIVIL CODE, Art. 1318).
STAGES OF CONTRACTS: (GPC)
1. Generation
– comprehends the preparation or conception. It
is the period of negotiation and bargaining,
ending at the moment of agreement of the
parties.
2. Perfection
– the moment when the parties come to agree
on the terms of the contract
3. Consummation
– it is the fulfillment or performance of the terms
agreed upon in the contract (ABS-CBN
Broadcasting Corporation v. CA, G.R. No.
128690, January 21, 1999).
CLASSIFICATION OF CONTRACTS
1. According to their relation to other
contracts
a. Preparatory– preliminary step towards the
celebration of another subsequent contract.
b. Principal – can subsist independently from
other contracts
c. Accessory – can exist only as a
consequence of, or in relation with, another
prior contract (JURADO, Obligations and
Contracts, supra at 359).
2. According to the risk involved
a. Commutative – each of the party acquires
an equivalent of his prestation.
b. Aleatory – each of the parties has to his
account the acquisition of an equivalent of his
prestation upon the happening of an event
which is uncertain – e.g., insurance
3. According to their perfection
a. Consensual – perfected by mere consent of
the parties
b. Real – requires not only consent of the
parties but also delivery of the object for their
perfection – e.g., commodatum, deposit,
mutuum (simple loan).
4. According to their purpose
a. Transfer of ownership – e.g., sale
b. Conveyance of use – e.g., commodatum
c. Rendition of service – e.g., agency
5. According to the nature of the vinculum
which they produce
a. Unilateral – give rise to an obligation for only
one of the parties
b. Bilateral – give rise to reciprocal obligations
for both parties
6. According to their form
a. Common or informal – requires no
particular form
b. Special/formal/Solemn – requires some
particular form
7. According to their cause
a. Onerous – in which each of the parties
aspires to procure for himself a benefit
through the giving of an equivalent or
compensation.
b. Gratuitous – in which one of the parties
proposes to give to the other a benefit without
any equivalent or compensation.
8. According to their subject matter
a. Things – e.g., sale, deposit
b. Services – e.g., agency, lease of services
9. According to their names
a. Nominate – have their own individuality;
regulated by special provisions of law
b. Innominate – contracts which do not have a
specific name; not regulated by special
provisions of law (Id. at 359-361).
KINDS OF INNOMINATE CONTRACTS:
1. Do ut des - I give that you give
2. Do ut facias - I give that you do
3. Facio ut des - I do that you give
4. Facio ut facias - I do that you do (DE LEON,
Obligations and Contracts, supra at 463).
NOTE: According to some authorities, do ut des is no
longer an innominate contract. It has already been
given a name of its own, i.e., barter or exchange
(CIVIL CODE, Art. 1638).
HOW INNOMINATE CONTRACTS
REGULATED
Innominate contracts shall be regulated,
successively, by:
1. The stipulations of the parties,
2. The general provisions of the CIVIL CODE on
obligations and contracts,
3. The rules governing the most analogous
nominate contracts and
4. The customs of the place (CIVIL CODE, Art.
1307).
CHARACTERISTICS OF CONTRACTS:
(MAOR)
1. Mutuality (CIVIL CODE, Art. 1308);
2. Autonomy (CIVIL CODE, Art. 1306);
3. Obligatory Force (CIVIL CODE, Art. 1159 and Art
1315); and
4. Relativity (CIVIL CODE, Art. 1311).
A. MUTUALITY OF CONTRACTS
The contract must bind both contracting parties; its
validity or compliance cannot be left to the will of one
of them (CIVIL CODE, Art. 1308).
EXCEPTION:
Validity or fulfillment may be left to:
1. The will of a third person, whose decision shall
not be binding until made known to both the
contracting parties (CIVIL CODE, Art. 1309); or
2. Chance (As sensucontrario from CIVIL CODE,
Art. 1308)
The determination shall not be obligatory if it is
evidently inequitable. In such case, the courts shall
decide what is equitable under the circumstances
(CIVIL CODE, Art. 1310).
Contract changes must be made with the consent of
the contracting parties. The minds of all the parties
must meet as to the proposed modification, especially
when it affects an important aspect of the
agreement. Thus, any change must be mutually
agreed upon; otherwise, it produces no binding effect
(Philippine Savings Bank v. Sps. Castillo, G. R. No.
193178, May 30, 2011).
Contract of Adhesion
One wherein one party imposes a ready-made form
of contract on the other. It is a contract whereby
almost all of its provisions are drafted by one party,
with the participation of the other party being limited
to affixing his or her signature or "adhesion" to the
contract. However, contracts of adhesion are not
invalid per se as they are binding as ordinary
contracts (Encarnacion Construction v. Phoenix
Ready Mix Concrete Development and Construction,
G.R. No. 225402, September 4, 2017).
NOTE: Contracts of adhesion do not violate mutuality
of contracts because the adhering party has the
freedom to reject it in its entirety. However, in case of
controversy, the contract is interpreted liberally in
favor of the adhering party (JURADO, Obligations
and Contracts, supra at 455). Condition in a contract
of adhesion if contrary to public policy should be
declared void and unenforceable to make the courts
accessible to all who may have need of their services
(Sweet Lines v. Teves, G.R. L-37750, May 19, 1978).
Contracts Cannot Be Unilaterally Cancelled
GENERAL RULE: No party can renounce the
contract unilaterally or without the consent of the
other (Landoil Resources v. Tensuan, G.R. No.
77733, December 20, 1988) just as nobody can be
forced to enter into a contract.
EXCEPTION: An agreement that a party may
terminate the contract upon reasonable period of
notice or when cancellation is by reason of breach
(CIVIL CODE, Art. 1191; Palay, Inc. v. Clave, G.R.
No. L-56076, September 21, 1983).
B. AUTONOMY
(FREEDOM TO CONTRACT)
The contracting parties may establish such
stipulations, clauses, terms and conditions as they
may deem convenient (CIVIL CODE, Art. 1306).
Freedom to contract is both a CONSTITUTIONAL
and STATUTORY right (CONST., Art. III, Sec 10;
CIVIL CODE, Art. 1306).
In contractual relations, the law allows the parties
leeway and considers their agreement as the law
between them. Contractual stipulations that are not
contrary to law, moral, good customs, public order or
public policy shall be binding and should be complied
with in good faith (Spouses Chung v. Ulanday
Construction, Inc., G.R. No. 156038, October 11,
2010).
Limitation to the Principle of Autonomy
Stipulations should not be contrary to law, morals,
good customs, public order, or public policy (CIVIL
CODE, Art. 1306).
1. Contrary to Law
Acts executed against the provisions of
mandatory or prohibitory laws shall be void,
except when the law itself authorizes their validity
(CIVIL CODE, Art. 5).
2. Contrary to Morals
The morals referred to are those principles which
are incontrovertible and are universally admitted
and which have received social and practical
recognition (JURADO, Obligations and
Contracts, supra at 363).
Example: Interest rate so high that it is so
unconscionable and shocking to the senses
(Andal v. PNB, G.R. No. 194201, November 27,
2013) and an agreement on a trial marriage is
void for being contrary to morals.
3. Contrary to Good Customs
Customs consist of habits and practices which
through long usage have been followed and
enforced by society or some part of it as binding
rules of conduct. It has the force of law when
recognized and enforced by law. A custom must
be proved as a fact, according to the rules of
evidence (CIVIL CODE, Arts. 12 & 1376).
Example: A contract providing for a penalty if one
of the parties would back out from his/her
promise to marry is against good customs
 (PINEDA, Obligations and Contracts, supra at
339).
4. Contrary to Public Order
Refers to the safety, as well as to the peace and
order, of the country or of any particular
community (JURADO, Obligations and
Contracts, supra at 364).
Example: A contract to commit rebellion.
5. Contrary to Public Policy
By public policy is intended that principle of law
which holds that no subject or citizen can lawfully
do that which has a tendency to be injurious to
the public or against the public good which may
be termed the “policy of the law,’’ or “public policy
in relation to the administration of the law’’
(Rivera v. Solidbank Corp., G.R. No. 163269,
April 19, 2006).
Examples: A quitclaim where a dismissed
employee waives action against his former
employer for any cause.
Autonomy of Contracts Submits to Fundamental
Human Rights and General Welfare
Non-impairment clause is inferior to:
1. The Police Power of the State (BF United
Homeowner’s Association, Inc. v. The City Mayor
of Parañaque, G.R. No 141010, February 7,
2007)
2. Freedom of Religion (Victoriano v. Elizalde Rope
Workers’ Union, G.R. No. L-25246, September
12, 1974).
C. OBLIGATORY FORCE
Obligations arising from contracts have the force of
law between the contracting parties and should be
complied with in good faith (CIVIL CODE, Art. 1159).
Contracts are perfected by mere consent, and from
that moment the parties are bound to the fulfillment of
what has been expressly stipulated and to all
consequences which, according to their nature, may
be in keeping with good faith, usage and law (CIVIL
CODE, Art. 1315).
NOTE: The binding force of contracts comes from the
consent of a free and unimpaired mind. Pacta sunt
servanda, “agreements must be kept”
A party cannot be allowed to renege on his obligation
under a contract simply because he changed his mind
(Morla v. Belmonte, G.R. No. 171146, December 7,
2011).
All Contracts Are Essentially Consensual
While most contracts are perfected by mere consent,
others require acts in addition to consent in order to
obtain obligatory force. These are:
1. Real contracts are not perfected until the
delivery of the object of the obligation (CIVIL
CODE, Art. 1316).
Examples: Deposit, commodatum and mutuum
(simple loan).
NOTE: This list is exclusive.
2. Solemn contracts or Formal contracts require
compliance with certain formalities prescribed by
law such prescribed form being thereby an
essential element thereof (DE LEON, Obligations
and Contracts, supra at 542).
Example: Donation of real property; Notarial Will
NOTE: In both real and solemn contracts, contractual
consent is impliedly included.
Effect of Perfection of the Contract
Until the contract is perfected, it cannot, as an
independent source of obligation, serve as a binding
juridical relation (Asuncion v. CA, G.R. No. 109125,
December 2, 1994; Amado v. Salvador, G.R. No.
171401, December 13, 2007).
Unaccepted offers and proposals remain as such and
cannot be considered as binding commitments;
hence, not demandable (Luxuria Homes, Inc. v. CA,
G.R. No. 125986, January 28, 1999).
From the moment the parties come to an agreement
on a definite subject matter and valid consideration,
they are bound not only:
1. To the fulfillment of what has been expressly
stipulated; but also,
2. To all the consequences which according to their
nature, may be in keeping with good faith, usage,
and law (CIVIL CODE, Art. 1315).
D. RELATIVITY
GENERAL RULE: Contracts take effect only
between the parties, their assigns and heirs (CIVIL
CODE, Art. 1311).
When a person assigns his credit to another person,
the latter is deemed subrogated to the rights as well
as to the obligations of the former (Fort Bonifacio
Development Corp. v. Fong, G.R. No. 209370, March
25, 2015).
When there is no privity of contract, there is likewise
no obligation or liability to speak about (Asian
Terminal, Inc. v. Padodon Stainless Steel
Corporation G.R. No. 211876, June 25, 2018).
Stipulations Pour Autrui
If a contract should contain some stipulation in favor
of a third person, a mere incidental benefit or interest
of a person is not sufficient. The contracting parties
must have clearly and deliberately conferred a favor
upon a third person (CIVIL CODE, Art. 1311, par. 2)
A beneficial stipulation or stipulation pour autrui (“for
another”) is a stipulation in a contract, clearly and
deliberately conferred by the contracting parties as a
favor upon a third person, who must have accepted it
before it could be revoked (JURADO, Obligations and
Contracts, supra at 382).
Example: A stipulation in a contract of sublease that
the sublessee’s rent shall be paid directly to the
principal lessor is a stipulation pour autrui (Limitless
Potentials, Inc. v. Quilala, G.R. No. 157391. July 15,
2005).
Test of Beneficial Stipulation
To constitute a valid stipulation pour autrui it must be
the purpose and intent of the parties to benefit the
third person. The test is whether or not the parties
deliberately inserted terms in their agreement with the
avowed purpose of conferring a favor upon such third
person (JURADO, Obligations and Contracts, at 383
citing Florentino v. Encarnacion, G.R. No. L-27696.
September 30, 1977).
Requisites of Valid and Binding Stipulation Pour
Autrui: (FP-CUAR)
1. There is a stipulation in Favor of a third person;
2. The stipulation is a Part, not the whole, of the
contract;
3. The contracting parties Clearly and deliberately
conferred a favor to the third person — the favor
is not an incidental benefit;
4. The favor is Unconditional and uncompensated;
5. The third person communicated his or her
Acceptance of the favor before its revocation;
and
6. The contracting parties do not Represent, or are
not authorized by, the third party (Republic of the
Philippines v. Legal Heirs of Jose L. Africa, G.R.
No. 205722; August 19, 2015).
Acceptance of Benefit by Third Party Required
If a contract should contain some stipulation in favor
of a third person, he may demand its fulfillment
provided he communicated his acceptance to the
obligor before its revocation (CIVIL CODE, Art. 1311,
par. 2).
REASON: Relativity of Contracts
Form of Acceptance of Beneficiary
The acceptance may be made at any time before the
favorable stipulation is revoked and that the
acceptance may be in any form it does not have to be
formal or express but may be implied (Sps. Narvaez
v. Sps. Alciso, G.R. No. 165907, July 27, 2009).
Exceptions to Relativity of Contracts:
1. Exceptionally, a contract may confer benefits to a
third person or what are otherwise known as
“stipulation pour autrui” (CIVIL CODE, Art. 1311,
par. 2);
2. In contracts creating real right, third persons who
come into possession of the object of the contract
may be bound thereby under the provisions of
mortgage laws and land registration law (CIVIL
CODE, Art. 1312);
3. Creditors are protected in cases of contracts
intended to defraud the (CIVIL CODE, Art. 1313);
4. Accion directa is allowed by law in certain cases
(CIVIL CODE, Art. 1729); and
5. Any third person who induces another to violate
his contract can be made liable for damages to
the other contracting party (CIVIL CODE, Art.
1314).
Intransmissible Contractual Rights Do Not Bind
Heirs, Assigns, and Successors-in-interest
Contractual Rights which are by law, nature, or
stipulation intransmissible cannot bind persons other
than the parties thereto.
Examples:
1. Membership in a non-stock corporation is
generally personal and intransmissible under the
Corporation Code (see REVISED
CORPORATION CODE, Sec. 89).
2. Personal obligations are intransmissible by
nature.
NOTE: Only personal obligations or those identified
with the persons themselves are extinguished by
death (Stronghold Insurance Co. v. Republic-Asahi
Glass Corp., G.R. No. 147561, June 22, 2006).
3. Right to vote.
Real Rights as to those Charged with Notice
A real right is a right belonging to a person over a
specific thing, without a passive subject individually
determined, against whom such right may be
personally enforced. Such a right, therefore, is
enforceable against the whole world (JURADO,
Obligations and Contracts, supra at 388).
A real right is binding upon third persons who are
chargeable with notice of the same.
A recorded real estate mortgage is a right in rem
(Paderes v. CA, G.R. No. 147074, July 15, 2005).
Transferees of Property Alienated In Fraud
Contracts entered into in order to defraud a creditor
are rescissible (CIVIL CODE, Art. 1381(3)).
The transferees are effectively bound to the contract
between the transferor and the charging creditor such
that any transfer of title to them are rescissible.
Tortious Interference
There is tortious interference where the third person
induces a contracting party to violate his contract.
Such third person can be held liable for damages
(CIVIL CODE, Art. 1314).
NOTE: The rule on tortious interference implies that
any person aware that a binding contract exists
between parties is bound to respect such juridical tie.
Requisites of Tortious Interference: (MIKE)
1. Existence of Malice;
2. Interference by third person without legal
justification or excuse;
3. The Existence of a valid contract; and
4. Knowledge on the part of the third person of the
existence of the contract (JURADO, Obligations
and Contracts, supra at 390).
Contracts by Agent without Authority are
Unenforceable
As a general rule, a person is not bound by the
contract of another of which he has no knowledge or
to which he has not given his consent (CIVIL CODE,
Art. 1311, par. 1).
A contract entered into in the name of another by one
who has no authority is unenforceable against the
former unless it is ratified by him before it is revoked
by the other contracting party (CIVIL CODE, Art. 1317
& 1403 (1)).
A contract entered into by an agent in excess of his
authority is unenforceable against the principal, but
the agent is personally liable to the party with whom
he contracted where such party was not given
sufficient notice of the limits of the powers granted by
the principal (CIVIL CODE, Art. 1897).
When a Person Bound by the Contract of Another
In order that a person may be bound by the contract
of another, there are two requisites:
1. The person entering into the contract must be
duly authorized, expressly or impliedly, by the
person in whose name he contracts or he must
have, by law, a right to represent him (like a
guardian or an administrator); and
2. He must act within his power.
CONSENT
CONSENT
Consent is manifested by the meeting of the offer and
the acceptance upon the thing and the cause which
are to constitute the contract. The offer must be
certain and the acceptance absolute. A qualified
acceptance constitutes a counter-offer (CIVIL CODE,
Art. 1319).
REQUISITES OF VALID CONSENT: (CCI)
1. Must be manifested by the Concurrence of the
offer and acceptance (CIVIL CODE, Arts. 1319-
1326);
2. Parties must possess the necessary legal
Capacity (CIVIL CODE, Arts. 1327-1329); and
3. Must be Intelligent, free, spontaneous, and real
(CIVIL CODE, Arts. 1330-1346).
“PARTIES” NOT SAME AS “PERSONS”
A contract must have at least two parties. However,
a party to a contract need not be a single person, nor
is it necessary that there are two or more persons to
constitute a party.
1. Auto-contracts
– a contract which is executed only by one
person except that the same person is executing
the contract in several capacities for several
parties.
Example: X is the agent of Y. X purchases a
property from Y. In the deed, X signs in his own
name as buyer. He then signs in a representative
capacity as agent of Y, signing for the Seller.
2. Collective contracts
– Contracts entered into by several persons as a
single party
Example: Collective bargaining contracts where
the collective bargaining unit, composed of many
persons who are employees of the same
employer is bound as a single party.
CONCURRENCE OF OFFER AND
ACCEPTANCE
OFFER
The proposal to make a contract (JURADO,
Obligations and Contracts, at 401).
In order to constitute a binding proposal, the offer
must be certain or definite (CIVIL CODE, Art. 1319).
REQUISITES OF VALID OFFER: (DICD)
1. It must be Definite;
2. It must be Intentional;
3. It must be Complete; and
4. It must be Directed to a person or persons with
whom the offeror intends to enter into a contract,
except definite offers which are not directed to a
particular person but to the public in general (i.e.,
public auction).
DEFINITE OFFER
An offer is definite if it is clearly stated. It must not be
vague or doubtful in its terms as to put to inquiry what
is to be accepted (4 TOLENTINO, supra at 448).
INTENTIONAL OFFER
An offer is intentional if it is seriously made with clear
intent and purpose to enter into a contract. There
must be a view of entering into an agreement.
NOTE: An offer clearly made in jest without intent to
be bound if accepted is not a valid offer (Id.at 449).
COMPLETE OFFER
An offer is complete if it is not lacking in its terms as
to require the parties to enter into subsequent
agreements. Any terms and conditions, and other
accessory stipulations must be communicated (Id.at
449).
DIRECTED OFFER
For the offer to be valid, it must be effectively
communicated to the person with whom the offeror
intends to contract with (Id.at 449).
NOTE: A written offer not delivered to the intended
recipient, but remained in a sealed envelope on the
person’s desk cannot be accepted.
WITHDRAWAL OF OFFER
Offer or proposal may be withdrawn so long as the
offeror has no knowledge of acceptance by offeree
(JURADO, Obligations and Contracts, supra at 401).
Pending the acceptance of an offer, the offeror can
perfect a contract over the same thing with another
person (4 TOLENTINO, supra at 458).
EXCEPTION: Option Contract – if it is founded upon
a consideration, as something paid or promised
(CIVIL CODE, Art. 1324).
COUNTER-OFFER
This refers to qualified acceptance; involves a new
proposal; a rejection of the original offer (JURADO,
Obligations and Contracts, supra at 401).
A qualified acceptance must, in turn, be accepted
absolutely in order that there will be a contract (DE
LEON, Obligations and Contracts, supra at 516).
COMPLEX OFFERS
When a single offer involves two or more contracts,
the perfection, where there is only partial acceptance,
will depend upon the relation of the contracts
between themselves, whether due to their nature or
due to the intent of the offeror (4 TOLENTINO, supra
at 452).
RULE ON COMPLEX OFFERS:
1. Offers are interrelated
– contract is perfected if all the offers are
accepted.
2. Offers are not interrelated
– single acceptance of each offer results in a
perfected contract unless the offeror has made it
clear that one is dependent upon the other and
acceptance of both is necessary (JURADO,
Obligations and Contracts, supra at 401).
ACCEPTANCE
The acceptance must also be certain or definite and
must be absolute in character. A qualified acceptance
constitutes a counter-offer (CIVIL CODE, Art. 1319).
It may be express or implied (CIVIL CODE, Art.
1320).
REQUISITES OF ACCEPTANCE:
(ADI-PC)
1. Absolute (no vitiation);
2. Directed to the offeror;
3. Made with the Intention to be bound (animus
contrahendi);
4. Made within the Proper time; and
5. Communicated to the offeror and learned by him
unless the offeror knows of the acceptance.
AMPLIFIED ACCEPTANCE
Under certain circumstances, a mere amplification on
the offer must be understood as an acceptance of the
original offer, plus a new offer which is contained in
the amplification. The intent of the offeree, however,
controls (4 TOLENTINO, supra at 452).
SUCCESSIVE AGREEMENTS
If the intention of one or both parties is that there be
concurrence on all points, the contract is not
perfected if there is a point of disagreement, even if
there is already agreement on the essential elements
of the contract (4 TOLENTINO, supra at 452).
Example: Either or both parties have declared that
there must be agreement on who should bear the
expenses of transportation of the thing upon delivery,
the contract is not yet perfected (4 TOLENTINO,
supra at 453).
IMPLIED ACCEPTANCE
Implied acceptance may arise from acts or facts
which reveal the intent to accept, such as the
consumption of the things sent to the offeree, or the
fact of immediately carrying out the contract offered
(4 TOLENTINO, supra at 460).
RIGHT OF THE OFFEROR TO SET
MANNER OF ACCEPTANCE
The offeror may fix the time, place, and manner of
acceptance, all of which must be complied with
(CIVIL CODE, Art. 1321).
NOTE: An acceptance which is not made in the
manner prescribed by the offeror is not effective, but
constitutes a counter-offer which the offeror may
accept (4 TOLENTINO, supra at 462).
OFFER MADE THROUGH AN AGENT
An offer made through an agent (not mere
messenger) is accepted from the time acceptance is
communicated to him (CIVIL CODE, Art. 1322).
NOTE: Art. 1322 is not applicable when an
intermediary has no power to bind either the offeror
or the offeree. Thus, the communication of the
acceptance to him does not perfect the contract (4
TOLENTINO, supra at 462).
Both the offer and acceptance are made through an
agent. If acceptance is through an agent, offer must
be authorized (DE LEON, Obligations and Contracts,
supra at 575).
THEORIES THAT DETERMINE THE
EXACT MOMENT OF PERFECTION
WHEN ACCEPTANCE IS MADE BY
LETTER OR TELEGRAM: (MERC)
1. Manifestation Theory
– perfected from the moment the acceptance is
declared or made.
Note: This is adhered to by the Code of
Commerce.
2. Expedition Theory
– perfected from the moment the offeree
transmits the notification of acceptance to the
offeror.
3. Reception Theory
– perfected from the moment that the notification
is in the hands of the offeror in such a manner
that he can, under ordinary conditions, procure
the knowledge of its contents, even if he is not
able to actually acquire such knowledge.
NOTE: This is adhered to by the E-Commerce
Act in some cases.
4. Cognition Theory
– perfected from the moment the acceptance
comes to the knowledge of the offeror. This is
adhered to by the CIVIL CODE (JURADO,
Obligations and Contracts, supra at 402).
SILENCE CONSTRUED AS CONSENT
Requisites: (DCC)
1. There is a Duty or possibility to express oneself;
2. The manifestation of the will Cannot be
interpreted in any other way; and
3. There is a Clear identity in the effect of the silence
and the undisclosed will (4 TOLENTINO, supra at
455).
OPTION CONTRACT
A preparatory contract giving a person for a
consideration a certain period and under specified
conditions within which to accept the offer of the
offeror. It is separate and distinct from the projected
main agreement or principal contract itself (subject
matter of the option) which the parties may enter into
upon the consummation of the option or which will be
perfected upon the acceptance of the offer (DE
LEON, at 527).
NOTE: The consideration need not be monetary; it
may consist of other things or undertaking but they
must be of value, in view of the onerous nature of the
contract of option (Navotas Industrial Corporation v.
Cruz, G.R. No. 159212, September 12, 2005)
Requisites:
1. It is supported by an independent consideration;
and
NOTE: If the option is without a consideration, it
is a mere offer to sell which is not binding until
accepted. If, however, acceptance is made
before a withdrawal, it constitutes a binding
contract (Sanchez v. Rigos, G.R. No. L-25494,
June 14, 1972).
2. It is exclusive (4 TOLENTINO, supra at 466).
ARTICLES 1324 AND 1479 COMPARED
Article 1324 lays down the general rule regarding
offer and acceptance. It has been interpreted as
modified by the provision of Article 1479 of the CIVIL
CODE which applies specifically to “a promise to buy
or sell” (DE LEON, Obligations and Contracts, supra
at 582).
An unconditional mutual promise to buy and sell as
long as the object is made determinate and the price
is fixed can be obligatory on the parties, and
compliance therewith may accordingly be exacted
(Asuncion v. CA, G.R. No. 109125, December 2,
1994).
A unilateral promise to buy or sell a determinate thing
not supported by any consideration distinct from the
price for which that thing was intended to be sold by
or to the promisee (offeree) does not bind the
promissor (offeror), even if accepted, and may be
withdrawn at any time (Asuncion v. CA, G.R. No.
109125, December 2, 1994).
NOTE: The optionee (holder of option) has the right,
but not the obligation, to buy or sell. Once the option
is exercised timely, i.e., the offer is accepted before a
breach of the option, a bilateral promise to buy and
sell ensues and both parties are then reciprocally
bound to comply with their respective undertakings
(Asuncion v. CA, G.R. No. 109125, December 2,
1994). In other words, a perfected contract of option
does not result in the perfection or consummation of
the sale. Only when the option is exercised may a
sale be perfected (Abalos v. Macatangay, Jr., G.R.
No. 155043, September 30, 2004).
BUSINESS ADVERTISEMENTS
GENERAL RULE: They are mere invitations to make
an offer, and not definite offers, unless it appears
otherwise (CIVIL CODE, Art. 1325).
EXCEPTION: However, if the advertisement is
complete in all the particulars necessary in a contract,
it may amount to a definite offer which, if accepted,
will produce a perfected contract (DE LEON,
Obligations and Contracts, supra at 539).
Example: For sale: 1,000 square meters lot at Green
Plains Village, Quezon City located at the corner of
Geronimo and Magallanes Streets for P5,000,000
cash. — Tel. No. 817-12-84.” This is a definite offer
(Id. at 539).
ADVERTISEMENTS FOR BIDDERS
They are simply invitations to make proposals. The
advertiser is not bound to accept the highest or lowest
bidder, unless the contrary appears (CIVIL CODE,
Art. 1326).
An advertisement to possible bidders is simply an
invitation to make proposals, and that an advertiser is
not bound to accept the lowest bidder unless the
contrary appears; respondent had the right to reject
bids, and it cannot be compelled to accept a bidder's
proposal and execute a contract in its favor. Indeed,
under Article 1326 of the Civil Code, which
specifically tackles offer and acceptance of bids,
provides that advertisements for bidders are simply
invitations to make proposals, and that an advertiser
is not bound to accept the highest bidder unless the
contrary appears (Northern Mindanao Industrial Port
and Services Corporation v. Iligan Cement
Corporation, G.R. No. 215387, April 23, 2018).
NOTE: It is not applicable to judicial sales because
the highest bid must necessarily be accepted (4
TOLENTINO, supra at 469).
LEGAL CAPACITY TO CONSENT
LEGAL CAPACITY
It refers not only to natural persons, but also to
artificial as well. The absence of legal capacity results
in legal incapacity, the causes of which are based on
positive provisions of law, and exist in opposition to,
or as limitations of, natural capacity, as in the case of
persons under civil interdiction (DE LEON,
Obligations and Contracts, supra at 543).
The capacity of the contracting parties is an
indispensable requisite of consent (JURADO,
Obligations and Contracts, supra at 417).
PERSONS INCAPACITATED TO GIVE
CONSENT ACCORDING TO THE CIVIL
CODE: (MID)
1. Minors
2. Insane or Demented
3. Deaf mutes who cannot read nor write.
CONSENT OF MINORS
Under the Civil Code, minors have a limited capacity
to consent. Consent by a minor is not an absence of
consent as to render the resulting contract void. A
minor’s consent only results in a voidable contract.
MINORS MAY CONTRACT THROUGH
THEIR GUARDIANS
Minors may validly contract without any impairing the
validity of said contract when they contract through
their natural guardians (parents) or legal guardians
(Id. at 418).
INSTANCES WHEN MINOR’S CONSENT
IS NOT DEEMED VITIATED
1. When the contract is entered into by a minor who
actively misrepresents his age (not merely
constructive representation) (Mercado v. Espiritu,
G.R. No. L-11872, December 1, 1917);
This exception is based on estoppel. Estoppel
presupposes capacity to misrepresent. The
circumstances of the minor (i.e. he appears to be
of legal age) must be of such nature that it could
 have been relied upon by the other party.
Otherwise, the contract remains voidable
(Mercado v. Espiritu, G.R. No. L-11872,
December 1, 1917).
2. When it involves the sale and delivery of
necessaries to minors (CIVIL CODE, Art. 1489,
par. 2);
3. When it involves a natural obligation and such
obligation is fulfilled voluntarily by the minor
(CIVIL CODE, Arts. 1425-1427);
CONTRACTS ENTERED INTO BY
MINORS MAY BE RATIFIED
When upon reaching the age of majority, they ratify
the same (Badillo v. Ferrer, G.R. No. L-51369, July
29, 1987).
INSANE OR DEMENTED PERSONS
An insane or demented person includes any person,
who, at the time of the celebration of the contract,
cannot understand the nature and consequences of
the act or transaction by reason of any cause
affecting his intellectual or sensitive faculties whether
permanent or temporary (JURADO, Obligations and
Contracts, supra at 421).
It is not necessary that there be a previous
declaration of mental incapacity in order that a
contract entered into by a mentally defective person
may be annulled; it is enough that the insanity existed
at the time the contract was made (4 TOLENTINO,
supra at 471).
NOTE: Mere forgetfulness without evidence that the
same has removed from a person the ability to
intelligently and firmly protect his property rights, will
not by itself incapacitate a person from entering into
contracts (Almeda v. Heirs of Ponciano Almeda, G.R.
No. 194189, September 14, 2017).
STATE OF DRUNKENNESS OR
HYPNOTIC SPELL
Contracts agreed to in a state of drunkenness or
during a hypnotic spell are voidable (CIVIL CODE,
Art. 1328).
But the same must be of a degree that obscures
completely the faculties and almost extinguishes the
consciousness of acts (JURADO, Obligations and
Contracts, supra at 422).
It is the result of the use of alcohol or drugs upon the
condition of the mind which determines whether the
user has capacity to contract at any given moment;
the mere use in itself does not incapacitate him (4
TOLENTINO, supra at 472).
LUCID INTERVAL
Contracts entered into during a lucid interval are valid
(CIVIL CODE, Art. 1328)
A person under guardianship for insanity may still
enter into a valid contract and even convey property,
provided it is proven that at the time of entering into
said contract, he was not insane or that his mental
defect, if mentally deranged, did not interfere with or
affect his capacity to appreciate the meaning and
significance of the transaction entered into by him
(JURADO, Obligations and Contracts, supra at 422).
PRESUMPTION OF CAPACITY
There is a prima facie presumption that every person
of legal age possesses the necessary capacity to
execute a contract (Id. at 423).
DEAF-MUTES WHO DO NOT KNOW HOW
TO WRITE
Being a deaf-mute is not by itself a disqualification for
giving consent. The law refers to the deaf-mute who
does not know how to write (4 TOLENTINO, supra at
471).
INCOMPETENTS
Under the Rules of Court, the following are
considered incompetents and may be placed under
guardianship:
1. Civil Interdiction
2. Hospitalized lepers
3. Prodigals (spendthrift)
4. Deaf and dumb who are unable to read and write
5. Those of unsound mind even though they have
lucid intervals
6. Those who by reason of age, disease, weak mind
and other similar causes, cannot without outside
aid, take care of themselves and manage their
property becoming thereby an easy prey for
deceit and exploitation (RULES OF COURT,
SECTION 2, Rule 92)
NOTE: Incompetents are also incapacitated from
giving unimpaired consent.
EFFECT WHERE BOTH CONTRACTING
PARTIES ARE INCAPABLE OF GIVING
UNIMPAIRED CONSENT
If both of the parties are incapable of giving consent,
the contract is unenforceable (CIVIL CODE, Art.
1403).
DISQUALIFICATION TO CONTRACT
Refers to those who are prohibited from entering into
a contract with certain persons with regard to certain
property under certain circumstances and not to
those who are incapacitated to give their consent to a. Violence;
a contract (CIVIL CODE, Arts. 1490& 1491). b. Intimidation;
c. Mistake
INCAPACITY V. DISQUALIFICATION d. Fraud; and
e. Undue influence (CIVIL CODE, Art. 1330).
INCAPACITY TO
DISQUALIFICATION TO
GIVE CONSENT 2. Vices of declaration (vicios de la
CONTRACT (CIVIL
(CIVIL CODE, ART.
CODE, ART. 1329) declaracion);
1327)

As to Restrictions 3. Simulation of contracts (CIVIL CODE, Arts.

1345-1346).
Restrains the exercise Restrains the very right
of the right to contract. itself. MISTAKE
Mistake or error is the false notion of a thing or a fact
As to Basis
material to the contract (DE LEON, Obligations and
Based upon subjective Based upon public policy Contracts, supra at 556).
circumstances of and morality.
certain persons. TWO GENERAL KINDS OF MISTAKE
MISTAKE OF FACT MISTAKE OF LAW
As to Validity
As to Existence
Voidable Void
(JURADO, Obligations and Contracts, supra at 428). One or both contracting One or both parties arrive
parties believe that a at an erroneous
PERSONS DISQUALIFIED TO fact exists when in conclusion regarding the
reality it does not or vice interpretation of a
CONTRACT versa. question of law or legal
1. Those under Civil interdiction for transactions effects of a certain act or
inter vivos (REVISED PENAL CODE, Art. 34) transaction.
2. Undischarged insolvents (INSOLVENCY LAW,
Sec. 24) As to Vitiation of Consent
3. Husband and wife cannot donate to each other to
each other(FC, Art. 87) Vitiates consent. Does not vitiate consent
4. Husband and wife cannot sell property to each except when it involves
other except when they are by consent or by mutual error as to the
judicial order under a regime of separation of effect of an agreement
property (CIVIL CODE, Art. 1490) when the real purpose is
5. Either spouse may not alienate or encumber frustrated.
community or conjugal property without the
(JURADO, Obligations and Contracts, supra at 429).
consent of the other spouse (FC, Arts 96 and
124)
6. The following cannot purchase (CIVIL CODE, REQUISITES OF MISTAKE OF FACT
Art.1491): WHICH VITIATES CONSENT: (SEM)
a. The guardian: his ward’s property 1. The error must be Substantial regarding:
b. The agent: the principal’s property a. The object of the contract (error in re) which
c. Executors and administrators: property may be:
under administration; i. Mistake as to the identity of the thing
d. Public officers: state property under their (error in corpore);
administration; ii. Mistake as to the substance of the thing
e. Justices, judges, prosecutors, clerks of court, (error in substantia);
lawyers: property attached in litigation. iii. Mistake as to the condition or state of the
thing; or
CONSENT MUST BE FREE, iv. Mistake as to the quantity of the thing
INTELLIGENT, SPONTANEOUS, REAL (error in quantitate) (Id. at 433);
b. The conditions which primarily moved or
induced one or both of the parties to enter
VICES OF CONSENT into the contract (CIVIL CODE, Art. 1331);
1. Vices of the will (vicios de la formacion c. Identity or qualifications of one of the parties
de la voluntad): (VIMFU) (error in persona), but only if such was the
 principal cause of the contract (CIVIL CODE,
Art. 1331, par. 2).
2. The error must be Excusable; and
3. The error must be a Mistake of fact, and
not of law (JURADO, Obligations and Contracts,
supra at 430-432).
ERROR IN RE
In order that mistake may invalidate consent, it should
refer to the substance of the thing which is the object
of the contract, or to those conditions which have
principally moved one or both parties to enter into the
contract (CIVIL CODE, Art. 1331, par. 1).
1. Mistake as to the identity of the thing as when the
thing which constitutes the object of the contract
is confused with another thing;
2. Mistake as to the substance of the thing (error in
substantia);
3. Mistake as to the conditions of the thing, provided
such conditions have principally moved one or
both parties to enter into the contract; and
4. Mistake as to the quantity of the thing (error in
quantitate), provided that the extent or dimension
of the thing was one of the principal reasons of
one or both of the parties for entering into the
contract.
MISTAKES WHICH DO NOT IN ANY
MANNER AFFECT THE VALIDITY OF THE
CONTRACT
1. Error with respect to accidental qualities of the
object of the contract (e.g. the quality of the
paper of a book, the adjoining owners of a piece
of land);
2. Error in the value of the thing (e.g. when a
person, having forgotten the cost price of
merchandise, erroneously sells it for less); and
3. Error which refers, not to the conditions of the
thing, but to accessory matters in the contract
foreign to the determination of the object (4
TOLENTINO, supra at 480).
ERROR IN QUANTITATE
It is important that this class of mistake should be
distinguished from a mistake of account or
calculation. In the first, there is a real mistake as to
the extent of the object of the contract; in the second,
there is only an apparent mistake, a mere mistake in
mathematical computation. As a consequence, in the
first, the contract is voidable; in the second, it is not
(JURADO, Obligations and Contracts, supra at 430).
ERROR IN PERSONA
This kind of mistake or error may refer either to the
name or to the identity or to the qualification of a
person.
The only mistake with regard to persons which will
vitiate consent are mistakes with regard to the identity
or the qualifications of one of the contracting parties.
(CIVIL CODE, Art. 1331, par. 2).
MISTAKE OF LAW
Mistake of law as a rule will not vitiate consent, except
when mutual error as to the legal effect of an
agreement when the real purpose of the parties is
frustrated, may vitiate consent (CIVIL CODE, Art.
1334).
REQUISITES OF MISTAKE OF LAW
WHICH VITIATES CONSENT: (LMF)
1. The mistake must be with respect to the Legal
effect of an agreement;
2. The mistake must be Mutual; and
3. The real purpose of the parties must have been
Frustrated (CIVIL CODE, Art. 1334).
BURDEN OF PROVING DEFENSE OF
SUFFICIENT UNDERSTANDING
There is no mistake if the party alleging it knew the
doubt, contingency or risk affecting the object of the
contract (CIVIL CODE, Art. 1333).
The obligation to show that the terms of the contract
had been fully explained to the party who is unable to
read or understand the language of the contract,
when fraud or mistake is alleged, devolves on the
party seeking to enforce it (CIVIL CODE, Art. 1332).
For Art. 1332 to apply, it must first be convincingly
established that the illiterate or disadvantaged party
could not read or understand the language in which
the contract was written, or that the contract was left
unexplained to said party (Dela Cruz v. Dela Cruz,
G.R. No. 146222, January 15, 2004).
ILLITERATE WHO SIGNS A CONTRACT
IS PRESUMED TO KNOW ITS CONTENTS
The rule that one who signs a contract is presumed
to know its contents has been applied even to
contracts of illiterate persons on the ground that if
such persons are unable to read, they are negligent
if they fail to have the contract read to them (Diampoc
v. Buenaventura, G.R. No. 200383; March 19, 2018).
It is a well-settled principle that the law will not relieve
parties from the effects of an unwise, foolish or
disastrous agreement they entered into with all the
required formalities and with full awareness of what
they were doing (Diampoc v. Buenaventura, G.R.
No. 200383; March 19, 2018).
VIOLENCE
When in order to wrest consent, serious or irresistible
force is employed (CIVIL CODE, Art. 1335).

REQUISITES FOR EXISTENCE OF
VIOLENCE SUFFICIENT TO VITIATE
CONSENT: (SD)
1. The force employed to wrest consent must be
Serious or irresistible; and
2. Must be the Determining cause for the party upon
whom it is employed in entering into the contract
(JURADO, Obligations and Contracts, supra at
436).
INTIMIDATION
There is intimidation when one of the contracting
parties is compelled by a reasonable and well-
grounded fear of an imminent and grave evil upon his
person or property, or upon the person or property of
his spouse, descendants or ascendants, to give his
consent (CIVIL CODE, Art. 1335).
REQUISITES FOR EXISTENCE OF
INTIMIDATION SUFFICIENT TO VITIATE
CONSENT: (CIRUP)
1. One party is Compelled to give his consent by a
reasonable and well-grounded fear of an evil;
2. The evil must be Imminent and grave;
3. It is the Reason why he enters the contract;
4. The evil must be Unjust (JURADO, Obligations
and Contracts, supra at 436); and
5. The evil must be upon his Person or property, or
that of his spouse, descendants, or ascendants
(DE LEON, Obligations and Contracts, supra at
566).
FACTORS THAT MAY BE CONSIDERED
IN DETERMINING INTIMIDATION
To determine the degree of intimidation, the age, sex
and condition of the person shall be borne in mind
(CIVIL CODE, Art. 1335, par. 3).
It refers principally to the person intimidated. By
condition here is meant not only the resolute or weak
character of the person intimidated, but also his other
circumstances, such as his capacity or culture, which
permits him to appreciate whether or not there is an
imminent danger, his position, by which he can
determine whether or not it gives him a chance to
thwart the danger (JURADO, Obligations and
Contracts, supra at 441).
NOTICE OR WARNING OF JUST ACTION
NOT INTIMIDATION
A threat to enforce one’s claim through competent
authority, if the claim is just or legal, does not vitiate
consent. (CIVIL CODE, Art. 1335, par. 4).
Even if it can be established that the reason or motive
of a party in entering into a contract was the threat of
the other to proceed against him through the courts,
the contract would still be perfectly valid and not
voidable (JURADO, Obligations and Contracts, supra
at 441).
The intimidation that will annul a contract has to do
with the evil or harm arising from an unlawful act. The
fear in itself does not justify the annulment of the
contract, unless such fear was induced by a
threatened wrong (4 TOLENTINO, supra at 491-492).
REVERENTIAL FEAR
If a contract is signed merely because of “fear of
displeasing persons to whom obedience and respect
are due,” the contract is still valid, for by itself,
reverential fear is not wrong (4 PARAS, supra at 639).
EXCEPTION: If in addition to such fear of causing
displeasure, there is an imposition upon the will, then
the consent will be vitiated (4 TOLENTINO, supra at
498).
NOTE: Consent given through intimidation must not
be confused with consent given reluctantly and even
against good sense and judgment. It is clear that one
acts as voluntarily and independently in the eyes of
the law when he acts reluctantly and with hesitation
as when he acts spontaneously and joyously
(JURADO, Obligations and Contracts, supra at 437
citing Vales v. Villa, G.R. No. 10028, December 16,
1916).
VIOLENCE V. INTIMIDATION
VIOLENCE INTIMIDATION
Refers to physical Refers to moral
compulsion compulsion
External or prevents the Internal or induces the
will to manifest itself performance of an act
(JURADO, Obligations and Contracts, supra at 435).
VIOLENCE NEED NOT COME FROM
PARTIES
Violence or intimidation shall annul the obligation,
although it may have been employed by a third
person who did not take part in the contract (CIVIL
CODE, Art. 1336).
UNDUE INFLUENCE
When a person takes improper advantage of his
power over the will of another, depriving the latter of
a reasonable freedom of choice (CIVIL CODE, Art.
1337).
REQUISITES FOR EXISTENCE OF
UNDUE INFLUENCE SUFFICIENT TO
VITIATE CONSENT: (IPD)
1. Improper advantage;
2. Power over the will of another; and
3. Deprivation of the latter’s will of a reasonable
freedom of choice (JURADO, Obligations and
Contracts, supra at 443).
NOTE: Undue influence must be distinguished from
intimidation, in that in intimidation there must be an
unlawful or unjust act which threatens, and which
causes consent to be given, while in undue influence,
there need not be an unjust or unlawful act (4
TOLENTINO, supra at 501).
Test of Undue Influence: Whether or not the
influence exerted has so overpowered or subjugated
the mind of a contracting party as to destroy his free
agency, making him express the will of another rather
than his own (JURADO, Obligations and Contracts,
supra at 444 citing Coso v. Fernandez Deza, G.R.
No. L-16763, December 22, 1921).
NOTE: By analogy, undue influence employed by a
third person may annul the contract (4 TOLENTINO,
supra at 503 citing Commission Memorandum to
Joint Congressional Committee on Codification,
March 8, 1951).
FRAUD IN CONTRACTS
When, through insidious words or machinations of
one of the contracting parties, the other is induced to
enter into a contract which, without them, he would
not have agreed to (CIVIL CODE, Art. 1338).
Fraud is deemed to comprise anything calculated to
deceive, including all acts, omissions, and
concealment involving a breach of legal or equitable
duty, trust, or confidence justly reposed, resulting in
damage to another, or by which an undue and
unconscientious advantage is taken of another
(Information Technology Foundation of the
Philippines v. Commission on Elections, G.R. No.
159139, June 6, 2017).
MALICIOUS INTENT IS BASIS OF
LIABILITY FOR FRAUD
As a ground for damages, malice or dishonesty is
implied. It is the element of intent and not the harm
done (JURADO, Obligations and Contracts, supra at
64).
FRAUD SYNONYMOUS WITH BAD FAITH
Bad faith does not simply connote bad judgment or
negligence; it imports a dishonest purpose or some
moral obliquity and conscious doing of a wrong, a
breach of a known duty through some motive or
interest or ill-will that partakes of the nature of fraud
(Cathay Pacific, Ltd. v. Vasquez, G.R. No. 150843,
March 14, 2003).
INSIDIOUS WORDS AND
MACHINATIONS
Constitutes deceit, including false promises,
exaggeration of hopes or benefits, abuse of
confidence, fictitious names, qualifications or
authority (4 TOLENTINO, supra at 505).
REQUISITES OF FRAUD UNDER
ARTICLE 1338: (BE-SIN)
1. It must be made in Bad faith, i.e., with knowledge
of its falsity (4 TOLENTINO, supra at 445-446);
2. One party must have Employed fraud or insidious
words or machinations;
3. It must have been Serious;
4. It Induced the other party to enter into a contract;
and
5. It must have been employed by one contracting
party upon the other and Not employed by both
contracting parties or by third persons.
FRAUD NOT PRESUMED
Bad faith and fraud are allegations of fact that
demand clear and convincing proof. They are serious
accusations that can be so conveniently and casually
invoked, and that is why they are never presumed
(Cathay Pacific Airways, Ltd., v. Sps. Vazquez, G.R.
No. 150843, March 14, 2003; DPWH v. Quica, G.R.
No. 183444, February 08, 2012).
LEGAL EXAMPLES AND
ILLUSTRATIONS OF FRAUD
1. Fraud by concealment
Failure to disclose facts, when there is a duty to
reveal them, constitutes fraud (CIVIL CODE, Art.
1339).
A neglect or failure to communicate that which a
party to a contract knows and ought to
communicate constitutes concealment. In this
case, concealment is equivalent to
misrepresentation (INSURANCE CODE, Sec.
26).
NOTE: Silence or concealment by itself does not
constitute fraud. The concealment contemplated
in Article 1339 presupposes a purpose or design
to hide facts which the other party ought to know
(DE LEON, Obligations and Contracts, supra at
641).
The injured party is entitled to cancel or annul a
contract whether the failure to disclose the
material facts is intentional or unintentional as
long as there is a duty to reveal or disclose them
 or according to good faith such disclosure should WHEN MISREPRESENTATION NOT
be made and the other party is misled or FRAUD
deceived in entering into the contract. If the
failure is unintentional, the basis of the action for Misrepresentation made in good faith is not
annulment is not fraud but mistake or error (CIVIL fraudulent but may constitute error (CIVIL CODE, Art.
CODE, Art. 1343). 1343).
MUTUAL FRAUD
If unintentional and there is no duty to make the When both parties use fraud reciprocally, neither one
disclosure, the parties are bound by their contract has an action against the other, and neither party can
(Id.). ask for the annulment of the contract (DE LEON,
Obligations and Contracts, supra at 651 citing Valdez
2. Principle of Tolerated Fraud (Dolus v. Sibal, G.R. No. L-26278, August 4, 1927).
Bonus)
The usual exaggerations in trade, when the other DISTINCTION OF FRAUD IN CONTRACTS
party had an opportunity to know the facts, are There are two types of fraud contemplated in the
not in themselves fraudulent (CIVIL CODE, Art. performance of contracts: dolo incidente or
1340). incidental fraud and dolo causante or fraud serious
enough to render a contract voidable (Tankeh v.
This is known as “tolerated fraud” which includes Development Bank of the Philippines, G.R. No.
minimizing the defects of the thing, exaggerating 171428, November 11, 2013).
its good qualities, and giving it qualities that it
does not have. They do not affect the validity of DOLO INCIDENTE V. DOLO CAUSANTE
the contract, so long as they do not go to the
extent of malice or bad faith (4 TOLENTINO, DOLO INCIDENTE DOLO CAUSANTE
supra at 510).
As to Source
Dealer’s talk or trader’s talk are representations
Referred to in Article Referred to in Article
which do not appear on the face of the contract
1344. 1338.
and these do not bind either party (DE LEON,
Obligations and Contracts, supra at 582; Puyat v. As to Character
Arce Amusement Co., G.R. No. L-47538, June
20, 1941; Philippine Steel Coating Corp. v. Not serious in character Deceptions or
Quinones, G.R. No. 194533, April 19, 2017). and without which the misrepresentations of a
other party would still serious character
3. Expression of an Opinion have entered into the employed by one party
A mere expression of an opinion does not signify contract. and without which the
fraud unless made by an expert and the other other party would not
party relied on the former’s special knowledge have entered into the
(CIVIL CODE, Art. 1341). contract.

An opinion of an expert is like a statement of a As to Cause

fact, and if false, may be considered a fraud
giving rise to annulment (4 TOLENTINO, supra at Only to some particular The essential cause of
511). or accident of the the consent.
obligation.
4. Fraud by Third Person
As to Effect
Fraud by a third person does not vitiate consent
and merely gives rise to an action for damages Person employing it Nullity of the contract
by the party injured against such third person must pay damages. and the indemnification
unless: of damages.
1. It has created a substantial mistake and the
same is mutual (CIVIL CODE, Art. 1342). (Geraldez v. Court of Appeals, G.R. No. 108253,
2. A third person makes the misrepresentation February 23, 1994).
with the complicity, or at least with the
knowledge but without the objection, of the SOME EXAMPLES OF WHAT
contracting party who is favored (JURADO, CONSTITUTE DOLO CAUSANTE OR
Obligations and Contracts, supra at 449). CAUSAL FRAUD:
1. When the seller, who had no intention to part with
her property, was "tricked into believing" that
 what she signed were papers pertinent to her
application for the reconstitution of her burned
certificate of title, not a deed of sale;
2. When the signature of the authorized corporate
officer was forged; or
3. When the seller was seriously ill, and died a week
after signing the deed of sale raising doubts on
whether the seller could have read, or fully
understood, the contents of the documents he
signed or of the consequences of his act
(Spouses Carmen S. Tongson and Jose C.
Tongson, et al., v. Emergency Pawnshop Bula,
Inc., G.R. No. 167874, January 15, 2010).
PRETENDING THAT ONE HAD THE
EXCLUSIVE FRANCHISE AND
PROMISING TO TRANSFER IT TO GET
THE OTHER PARTY'S CONSENT IS
DOLO INCIDENTE
Plaintiff Charles Woodhouse entered into a written
agreement with the defendant Fortunato Halili to
organize a partnership for the bottling and distribution
of soft drinks. However, the partnership did not come
into fruition, and the plaintiff filed a Complaint in order
to execute the partnership. The defendant filed a
Counterclaim, alleging that the plaintiff had defrauded
him because the latter was not actually the owner of
the franchise of a soft drink bottling operation. Thus,
defendant sought the nullification of the contract to
enter into the partnership.
It was concluded that plaintiff did actually represent
to defendant that he was the holder of the exclusive
franchise. The defendant was made to believe, and
he actually believed, that plaintiff had the exclusive
franchise. The record abounds with circumstances
indicative that the fact that the principal consideration,
the main cause that induced defendant to enter into
the partnership agreement with plaintiff, was the
ability of plaintiff to get the exclusive franchise to
bottle and distribute for the defendant or for the
partnership. The defendant was, therefore, led to the
belief that plaintiff had the exclusive franchise, but
that the same was to be secured for or transferred to
the partnership.
Thus, while the representation that plaintiff had the
exclusive franchise did not vitiate defendant's
consent to the contract, it was used by plaintiff to get
from defendant a share of 30 percent of the net
profits; in other words, by pretending that he had the
exclusive franchise and promising to transfer it to
defendant, he obtained the consent of the latter to
give him (plaintiff) a big slice in the net profits. This is
the dolo incidente defined in article 1270 of the
Spanish Civil Code, because it was used to get the
other party's consent to a big share in the profits, an
incidental matter in the agreement (Woodhouse v.
Halili, G.R. No. L-4811, July 31, 1953).
QUANTUM OF EVIDENCE TO PROVE
THE EXISTENCE OF FRAUD AND THE
LIABILITY OF THE PARTIES
In order to constitute fraud that provides basis to
annul contracts, it must fulfill two conditions:
1. First, the fraud must be dolo causante or it must
be fraud in obtaining the consent of the party.
In order for the deceit to be considered serious, it
is necessary and essential to obtain the consent
of the party imputing fraud. To determine whether
a person may be sufficiently deceived, the
personal conditions and other factual
circumstances need to be considered.
2. Second, this fraud must be proven by clear and
convincing evidence (Tankeh v. Development
Bank of the Philippines, G.R. No. 171428,
November 11, 2013).
SIMULATION OF CONTRACTS
It is the declaration of a fictitious will, deliberately
made by agreement of the parties, in order to
produce, for purposes of deception, the appearance
of a juridical act which does not exist or is different
from that which was really executed (4 TOLENTINO,
supra at 516).
The main characteristic of an absolute simulation is
that the apparent contract is not really desired or
intended to produce legal effect or in any way alter
the juridical situation of the parties. As a result, an
absolutely simulated or fictitious contract is void, and
the parties may recover from each other what they
may have given under the contract (Tanchuling v.
Cantela, G.R. No. 209284; November 10, 2015).
Under Article 1345 of the CIVIL CODE, simulation of
a contract may be absolute, when the parties do not
intend to be bound at all, or relative, when the parties
conceal their true agreement. The former is known as
contracto simulado while the latter is known as
contracto disimulado. An absolutely simulated or
fictitious contract is void while a relatively simulated
contract when it does not prejudice a third person and
is not intended for any purpose contrary to law,
morals, good customs, public order or public policy
binds the parties to their real agreement. Here, in
executing the Deed of Assignment, Ferrochrome
Philippines, Inc. (FPI)'s intention was not to transfer
absolutely the assigned assets to G Holdings, Inc. in
payment of FPI's obligations. It did not really intend to
divest itself of its title and control of the assigned
properties (G Holdings v. Cagayan Electric Power
and Light Company Co. (CEPALCO), G.R. No.
226213, September 27, 2017).
REQUISITES: (DAP) REQUISITES OF VALID CONTRACTUAL
1. A Deliberate declaration contrary to the will of the OBJECT: (CLRT-D)
parties; 1. Must be within the Commerce of man (CIVIL
2. Agreement of the parties to the apparently valid CODE, Art. 1347);
act; and 2. Should be Licit (CIVIL CODE, Art. 1347);
3. The Purpose is to deceive or to hide from third 3. Should be Real or possible (CIVIL CODE, Art.
persons (Loyola v. CA, G.R. No. 115734, 1348);
February 23, 2000). 4. Should be Transmissible (CIVIL CODE, Art.
1347);
ABSOLUTE V. RELATIVE SIMULATION 5. Should be Determinate, or at least possible of
determination as to its kind (CIVIL CODE, Art.
ABSOLUTE RELATIVE
1349).
(SIMULADOS) (DISIMULADOS)

As to Intention to be Bound ALL THINGS MAY GENERALLY BE

SUBJECT OF CONTRACTS
Parties do not intend to Parties have an All things or services may be the object of contracts.
be bound by the agreement which they This includes future things or rights which do not
contract at all. conceal under the guise belong to the obligor when the contract was made
of another contract(4 (CIVIL CODE, Art. 1347).
TOLENTINO, supra at
516) As a general rule, all rights may be the object of a
contract. The exceptions are when they are
As to Binding Effect
intransmissible by their nature, or by stipulation, or by
Void (JURADO, Binds the parties to their provision of law (CIVIL CODE, Art. 1311, par. 1).
Obligations and real agreement, when it
Contracts, supra at does not prejudice a third INVALID OBJECTS OF CONTRACTS:
454). person and is not (OIF-SIN)
intended for any purpose 1. Things Outside the commerce of men (CIVIL
contrary to law, morals, CODE, Art. 1347);
good customs, public 2. Intransmissible rights (CIVIL CODE, Art 1347);
order or public 3. Future inheritance;
policy(CIVIL CODE, Art. 4. Services contrary to law, morals, good customs,
1346). public order or public policy (CIVIL CODE, Art.
1306);
THIRD PERSON ACTING IN GOOD FAITH 5. Impossible things or services; and
6. Objects Not possible of determination as to their
With respect to a third person acting in good faith, the kind.
apparent contract must be considered as the true
contract. The declaration that the contract is NOTE: In order that a thing, right or service may be
simulated does not prejudice him (4 TOLENTINO, the object of a contract, it should be in existence at
supra at 519). the moment of the celebration of the contract, or at
least, it can exist subsequently or in the future (4
TOLENTINO, supra at 521).

OBJECT OF Examples:
CONTRACTS Things of public ownership such
Outside the as sidewalks, public places,
Commerce of bridges, streets, etc.; things that
Men are common to everybody such
OBJECT as air, sunlight, rain
The thing, right or service which is the subject matter
of the obligation arising from the contract (JURADO, Prohibited drugs and all illicit
Obligations and Contracts, supra at 456). objects; to kill a person, etc.
Impossible,
(illicit things or services are also
Physically or
outside the commerce of men.);
Legally
to get soil from planet Jupiter; to
construct a building in one day
 CIVIL CODE relating to testamentary succession
All the cavans of rice in a
(FC, Art. 130); and
warehouse; all the eggs in a
Determinable 2. A person may make a partition of his estate by an
basket; my land with the
Things act inter vivos, provided that the legitime of
smallest area; the land at the
compulsory heirs is not prejudiced (CIVIL CODE,
corner of a particular street
Art. 1080).
Things to be manufactured,
raised, or acquired after the IMPOSSIBLE THINGS OR SERVICES
perfection of the contract such Impossible things or services cannot be the object of
as wine that a vineyard is contracts (CIVIL CODE, Art. 1348).
expected to produce; wool that
Future Things
shall thereafter grow upon a KINDS OF IMPOSSIBILITY
or Rights
sheep; rice to be harvested next
1. Absolute or objective
harvesting season; milk that a
– when nobody can perform the service. It
cow may yield; eggs that hens
nullifies the contract; or
may lay; young animals not yet
in existence, etc.
2. Relative or subjective
Political rights such as the right – when due to the special conditions or
to vote; family, marital, and qualifications of the debtor, it cannot be
Intransmissible performed. If temporary, it does not nullify the
parental rights; right to public
Rights contract (4 TOLENTINO, supra at 526).
office, or to run for public office,
etc.
(DE LEON, Obligations and Contracts, supra at 599).
PARTIAL IMPOSSIBILITY
If the thing is partly possible and partly impossible,
the effect will depend upon the divisibility of the thing.
FUTURE THINGS If it is indivisible, by its nature or by the intention of
A future thing may be the object of a contract. Such the parties, there is no contract; the consent would be
contract may be either be: wanting. But if the thing is divisible, then the contract
1. Conditional is valid to the extent possible (4 TOLENTINO, supra
– if its efficacy should depend upon the future at 527).
existence of the thing (4 TOLENTINO, supra at
521). DIFFICULTY OF PERFORMANCE
A showing of mere inconvenience, unexpected
2. Aleatory impediments, or increased expenses is not enough to
– if one of the contracting parties should bear the
relieve a party of the obligation (JURADO,
risk that the thing will never come into existence
Obligations and Contracts, supra at 294; De Castro
(4 TOLENTINO, supra at 522).
v. Longa, G.R. No. L-2152-53, July 31, 1951).
EXCEPTION: No contract may be entered into with
The difficulty of performance should be such that the
respect to future inheritance except in cases
party seeking to be released from a contractual
expressly authorized by law (CIVIL CODE, Art. 1347,
obligation would be placed at a disadvantage by the
par. 2).
unforeseen event. Mere inconvenience, unexpected
impediments, increased expenses, or even pecuniary
ELEMENTS OF FUTURE INHERITANCE: inability to fulfil an engagement, will not relieve the
(OPE) obligor from an undertaking that it has knowingly and
1. The succession has not yet been Opened; freely contracted (Sps. Poon v. Prime Savings Bank,
2. The object of the contract forms Part of the G.R.No.183794, June 13, 2016).
inheritance; and
3. The promissor has a mere Expectancy of a right QUANTITY SHOULD BE DETERMINATE
which is purely hereditary in nature (J.L.T. Agro AS TO ITS KIND OR SPECIES
Inc. v. Balansag, G.R. No. 141882. March 11,
The fact that the quantity is not determinate shall not
2005).
be an obstacle to the existence of the contract,
provided it is possible to determine the same, without
EXCEPTIONS TO THE EXCEPTION
the need of a new contract between the parties (CIVIL
1. Future spouses may give or donate to each other
CODE, Art. 1349).
in their marriage settlement their future property
to take effect upon the death of the donor and to
The object of a contract, in order to be considered as
the extent laid down by the provisions of the
“certain,” need not specify such object with absolute
certainty as long as it is determinable (Domingo CAUSE V. MOTIVE
Realty v. CA, G.R. No. 126326, January 26, 2007).
CAUSE MOTIVE

As to Proximity
CAUSE OF CONTRACTS Direct and most Indirect/particular or
proximate/essential remote reason.
reason of a contract.

CAUSE As to Characteristic of Reason

It is the immediate, direct or most proximate reason
Objective or juridical Psychological, individual
which explains and justifies the creation of an
reason for the existence or purely personal
obligation through the will of the contracting parties
of a contract. reason.
(JURADO, Obligations and Contracts, supra at 464).
As to Contracting Parties
ESSENTIAL REQUISITES OF CAUSE:
(ELT) Always the same for Differs for each
1. Existing at the time of the celebration of the each contracting party. contracting party.
contract
As to Effect in the Validity of Contract
2. Licit or lawful; and
3. True (JURADO, Obligations and Contracts, Its legality affects the Its legality does not affect
supra at 472). existence or validity of the existence or validity
the contract. of contract.
NOTE: A promise made by one party, if made in
accordance with the forms required by law, may be a (4 TOLENTINO, supra at 466).
good cause or consideration for a promise made by
the other party (4 TOLENTINO, supra at 532). NOTE: Motive becomes causa when it predetermines
the purpose of the contract (4 TOLENTINO, supra at
CAUSE V. OBJECT 466).

CAUSE OBJECT CAUSE IN DIFFERENT CONTRACTS

As to Remuneratory Contracts CAUSE

The service or benefit The thing which is given For each contracting party, the
which is remunerated in remuneration prestation or promise of a thing or
service by the other;
As to Gratuitous Contracts NOTE: A promise made by one
party may be a sufficient cause for
The liberality of the The thing which is given Onerous a promise made by another party.
donor or benefactor or donated Contracts It is not, therefore, necessary that
the cause or consideration should
As to the Thing pass from one party to the other
Prestation or promise of The thing or service itself at the time of the execution of the
a thing or service by the contract (JURADO, Obligations
other and Contracts, supra at 468).

As to Contracting Parties The service or benefit which is

remunerated.
Different with respect of May be the same for both
each party the parties NOTE: Remuneratory contract is
one in which one of the
(4 TOLENTINO, supra at 464-465). Remuneratory
contracting parties remunerates
Contracts
or compensates the service or
benefit rendered or given by the
other party, although such service
or benefit does not constitute a
demandable debt (Id. at 471).

Gratuitous Mere liberality of the benefactor
Contracts (Id. at 472).
Accessory Same as that of the principal
Contracts contract (Id. at 469).
(CIVIL CODE, Arts. 1350 & 2052).
MORAL OBLIGATION AS CAUSE
Where the moral obligation arises wholly from ethical
considerations, unconnected with any civil
obligations, it cannot constitute a sufficient cause or
consideration to support an onerous contract
(JURADO, Obligations and Contracts, supra at 469;
see Fisher v. Robb, G.R. No. 46274, November 2,
1939).
Where such moral obligation is based upon a
previous civil obligation which has already been
barred by the statute of limitations at the time when
the contract is entered into, it constitutes a sufficient
cause or consideration to support a contract, it is then
already a natural obligation (Id. at 469-470).
EFFECTS OF LACK, ILLEGALITY,
FALSITY, OR INADEQUACY OF CAUSE
1. Total lack or absence of cause – the contract
confers no right and produces no legal effect
(CIVIL CODE, Art. 1352).
NOTE: Even if the cause is not stated in the
contract, it is presumed that it exists and is lawful,
unless the debtor proves the contrary (CIVIL
CODE, Art. 1354)
2. Illegal/Unlawful cause – the contract is null and
void (CIVIL CODE, Art. 1409 (1)).
3. False cause – the contract is void unless it should
be proved that it be founded upon another cause
which is true and lawful (CIVIL CODE, Art. 1353).
4. Inadequacy of cause/lesion – the contract is
valid. However, under certain conditions, it is
rescissible under Article 1381(1).
Even if the consideration for the contract is only
P1.00, it will not render the contract void,
because it is the absence of consideration, not
mere inadequacy which will result in a void
contract (Carantes v. CA, G.R. No. L-33360, April
25, 1977).
PRESUMPTION OF LAWFUL CAUSE
When the cause is not stated, it shall be presumed to
be in existence and lawful unless proof to the contrary
is shown (CIVIL CODE, Art.1354).
NOTE: The presumption that a contract has sufficient
consideration cannot be overthrown by a mere
assertion that it has no consideration. To overcome
the presumption, the alleged lack of consideration
must be shown by preponderance of evidence. The
burden to prove lack of consideration rests upon
whoever alleges it (Mendoza v. Sps. Palugod, G.R.
No. 220517, June 20, 2018).
FORM OF CONTRACTS
(ARTS. 1356-1358)
FORM OF CONTRACTS
Contracts shall be obligatory, in whatever form they
may have been entered into, provided all the
essential requisites for their validity are present
(CIVIL CODE, Art. 1356).
NOTE: Art. 1356 retained the “Spiritual System” of
the Spanish Code by virtue of which the law looks
more at the spirit rather than the form of contracts
(JURADO, Obligations and Contracts, supra at 479).
CONSENT IS GENERALLY SUFFICIENT
FOR VALIDITY, ENFORCEABILITY AND
EFFECTIVITY
A contract may be (1) parol or oral, or (2) in writing,
or (2) partly oral and partly in writing. If in writing, it
may be in a public or a private instrument.
A contract need not be contained in a single writing.
It may be collected from different writings which do
not conflict with each other and which when
connected, show the parties, subject matter, terms
and consideration, as in contracts entered into by
correspondence (DE LEON, Obligations and
Contracts, supra at 634).
IMPLIED-IN-FACT CONTRACT
One implied from facts and circumstances showing a
mutual intention to contract. It arises where the
intention of the parties is not expressed but
manifested by conduct and not by direct or explicit
words between parties but is to be deduced from
conduct of the parties, language used, or things done
by them, or other pertinent circumstances attending
the transaction (UP v. Philab Industries, Inc., G.R.
No. 152411, September 29, 2004).
EXCEPTIONS TO GENERAL RULE:
1. When the law requires that the contract be in a
certain form to be valid (CIVIL CODE, Art. 1356);
2. When law requires that the contract be in a
certain form to be enforceable (CIVIL CODE, Art.
1403); and
3. When required to make the contract effective as
against third parties (CIVIL CODE, Art. 1357-
1358).
CONTRACTS WHICH BY LAW MUST
APPEAR IN WRITING
1. For Validity
a. Wills (CIVIL CODE, Art 804);
b. Stipulation limiting Common carrier’s duty of
extraordinary diligence to ordinary diligence
(CIVIL CODE, Art. 1744);
c. Donation of personal property whose value
exceeds P5,000 (CIVIL CODE, Art. 748);
d. Antichresis (CIVIL CODE, Art. 2134);
e. Sale of a piece of Land or any interest therein
through an agent (CIVIL CODE, Art. 1874);
f. Agreements regarding payment of Interest in
contracts of loan (CIVIL CODE, Art. 1956);
g. Donation propter nuptias (FC, Art. 82); and
h. Sale of transfer of large cattle (P.D. No. 533,
August 8, 1974).
2. For Enforceability
a. An agreement that by its terms is not to be
performed within a year from the making
thereof;
b. A contract of guarantee
c. A contract propter nuptias
d. Sale of personal property worth more than
P500
e. Sale of real property
f. A lease for a period longer than one year
g. A representation as to the credit of a third
person.
CONTRACTS WHICH MUST APPEAR IN A
PUBLIC DOCUMENT
1. For Validity
a. Donation of immovable properties (CIVIL
CODE, Art. 749);
b. Donation of personal property, the value of
which exceeds P5,000 (CIVIL CODE, Art.
748);
c. Partnership where immovable property or
real rights are contributed to the common
fund (CIVIL CODE, Arts. 1771 &1773).
2. For Efficacy and Convenience
a. Acts and contracts which have for their
object, creation, transmission, modification
or extinguishment of real rights over
immovable property, except sale of real
property (CIVIL CODE, Art. 1358(1));
b. The cession, repudiation or renunciation of
hereditary rights or of those of the conjugal
partnership of gains (CIVIL CODE, Art.
1358(2));
c. The power to administer property, or any
other power which has for its object an act
appearing or which should appear in a public
document, or should prejudice a third person
(CIVIL CODE, Art. 1358(3)); and
d. The cession of actions or rights proceeding
from an act appearing in a public document
(CIVIL CODE, Art. 1358(4)).
3. To Bind Third Persons
a. Assignment (CIVIL CODE, Art. 1625);
b. Sale/transfer of large cattle (Anti-Cattle
Rustling Law of 1974, P.D. No. 533);
c. Matters required to be registered and
annotated on a Certificate of Title to Land
(P.D. No. 1529).
ACTION FOR EXECUTION OF FORMAL
INSTRUMENT DOES NOT CURE
INVALIDITY
If the law requires a document or other special form,
as in the acts and contracts enumerated in the
following article, the contracting parties may compel
each other to observe that form, once the contract
has been perfected. This right may be exercised
simultaneously with the action upon the contract.
(CIVIL CODE, Art. 1357).
NOTE: Because Article 1357 presupposes the
execution of a memorandum of a contract already
perfected, Article 1357 is not applicable to contracts
who require certain formalities for their validity.
SIGNING OF INSTRUMENTS
A contract may be encompassed in several
instruments even though every instrument is not
signed by the parties, since it is sufficient if the
unsigned instruments are clearly identified or referred
to and made part of the signed instruments (BF
Corporation v. CA, G.R. No. 120105, March 27,
1998).
ELECTRONIC CONTRACTS
The formal requirements to make contracts effective
as against third persons and to establish the
existence of a contract are deemed complied with,
provided that the electronic document is unaltered
and can be authenticated as to be usable for future
reference (Electronic Commerce of 2000, R.A. No.
8792, sec. 7 (a)).
PROBATIVE VALUE OF PUBLIC
DOCUMENTS
The effect of the notarization of a private document is
to convert the said document into a public one and
render it admissible in evidence in court without
further proof of its authenticity and due execution
(Nadayag v. Grageda, A.C. No. 3232, September 27,
1994).
By law, a notarial document is entitled to full faith and
credit upon its face.24 It enjoys the presumption of
regularity and is a prima facie evidence of the facts
stated therein – which may only be overcome by
evidence that is clear, convincing and more than
merely preponderant. Without such evidence, the
presumption must be upheld (Heirs of Sps. Liwagon
and Dumalagan v. Heirs of Sps. Liwagon and
Liwagon, G.R. No. 193117, November 26, 2014).
REFORMATION OF
INSTRUMENTS
(ARTS. 1359-1369)
REFORMATION OF INSTRUMENTS
The remedy through which a written instrument is
made or construed so as to express or conform to the
real intention of the parties when some error or
mistake has been committed (JURADO, Obligations
and Contracts, supra at 487).
THE PAROL EVIDENCE RULE
When the terms of an agreement have been reduced
to writing, it is considered as containing all the terms
agreed upon and there can be, between the parties
and their successors in interest, no evidence of such
terms other than the contents of the written
agreement (RULES OF COURT, Rule 130, Sec. 9,
par. 1).
The rule excludes extrinsic evidence by which a party
seeks to contradict, vary, add to or subtract from the
terms of a valid agreement or instrument.
EXCEPTION:
1. When there is an intrinsic ambiguity, mistake or
imperfection in the written agreement;
2. When there is failure of the written agreement to
express the true intent and agreement of the
parties thereto (RULES OF COURT, Rule 130,
Sec. 9, par. 2).
REFORMATION V. ANNULMENT
REFORMATION ANNULMENT
As to Validity of Contract

RATIONALE: It would be unjust to enforce a written Presupposes that there The contract was not
instrument which does not truly reflect the real is a valid contract but validly entered into as
agreement of the parties. In reforming an instrument, the when their minds did not
no new contract is created for the parties, rather, the document/instrument meet or if the consent
reformed instrument establishes the real agreement executed does not was vitiated.
between the parties (Makati Tuscany Condominium express their true
Corporation v. Multi-Realty Development intention.
Corporation, G.R. No. 185530; April 18, 2018).
As to Effect
REQUISITES: (MIMIC)
Gives life to the contract Involves a complete
1. Meeting of the minds of the parties; by making the nullification of the
2. Their true Intention is not expressed in the instrument conform to contract.
instrument; the true intention of the
3. Failure to express true intention is due to Mistake, parties.
fraud, inequitable conduct or accident
4. The facts upon which relief by way of reformation (JURADO, Obligations and Contracts, supra at 488).
of the instrument is sought are put in Issue by the
pleadings; and CAUSES/GROUNDS FOR
5. Clear and convincing proof of mistake, accident, REFORMATION: (MFCIO)
relative simulation, fraud, or inequitable conduct
1. Mutual Mistake
(DE LEON, Obligations and Contracts, supra at
– In case of mutual mistake of the parties (CIVIL
648).
CODE, Art. 1361)
NOTE: However, intentions involve a state of mind,
making them difficult to decipher; therefore, the 2. Fraud
subsequent and contemporaneous acts of the parties – When one party was mistaken and the other
must be presented into evidence to reflect the parties' party acted fraudulently (CIVIL CODE, Art. 1362).
intentions (Makati Tuscany Condominium
Corporation v. Multi-Realty Development 3. Concealment amounting to Fraud
Corporation, G.R. No. 185530; April 18, 2018). – When one party was mistaken, the other knew
or believed that the instrument does not show
their real intent but concealed that fact to the
former (CIVIL CODE, Art. 1363).

4. In case of Ignorance, lack of skill,
negligence or bad faith on the part of the
person drafting the instrument or the
clerk or typist (CIVIL CODE, Art. 1364); and
5. Equitable Mortgage
– When parties agree upon the mortgage of a real
property, but the instrument states that the
property is sold absolutely or with a right of
repurchase (CIVIL CODE, Art. 1365).
NOTE: Correlate to Article 1605.
WHO MAY ASK FOR REFORMATION
1. In case of mutual mistake, the action for
reformation may be brought by instance of either
party or their successors in interest;
2. In other cases, the action may be brought by the
instance of the injured party or his successors-in-
interest (CIVIL CODE, Art. 1368).
INSTANCES WHEN THERE CAN BE NO
REFORMATION: (SWAE)
1. Simple donations inter vivos wherein no
condition is imposed (CIVIL CODE, Art.
1366(1));
REASON: An action to reform an instrument is in
the nature of specific performance and requires a
valuable consideration – an element lacking as
between donor and donee, and between testator
and beneficiary (4 TOLENTINO, supra at 556).
2. Wills (CIVIL CODE, Art. 1366(2));
NOTE: Only imperfect or erroneous descriptions
of persons or property can be corrected, but the
manner in which the testator disposes of his
property cannot be changed by a reformation of
the instrument (4 TOLENTINO, supra at 556).
3. When the real Agreement is void (CIVIL
CODE, Art.1366(3))
NOTE: Upon the reformation of an instrument,
the general rule is that it relates back to and takes
effect from the time of its original execution as
between the parties.
If mistake, fraud, inequitable conduct or accident
has prevented a meeting of the minds of the
parties, the proper remedy is not reformation of
the instrument but annulment of the contract
(CIVIL CODE, Art. 1359, par.2).
Expediency and convenience are not grounds for
the reformation of an instrument (Multi-Ventures
Capital and Management Corp. v. Stalwart
Management Services Corp., G.R. No. 157439,
July 4, 2007).
4. When one of the parties has brought an
action to enforce the instrument, no
subsequent reformation can be asked
(Principle of Estoppel) (CIVIL CODE, Art.
1367).
INTERPRETATION OF
CONTRACTS
(ARTS. 1370-1379)
1. If the terms are clear and no doubt upon the
intention of the parties, the literal meaning of its
stipulations shall control (CIVIL CODE, Art. 1370,
par. 1).
The contract is the law between the parties and
when the words of the contract are clear and can
easily be understood, there is no room for
construction (Olivares and Robles v. Sarmiento,
G.R. No. 158384, June 12, 2008).
If the terms of a contract are clear and leave no
doubt upon the contracting parties’ intention,
such terms should be applied in their literal
meaning (Sps. Dumlao v. Marlon Realty Corp.,
G.R. No. 131491, August 17, 2007).
2. If words are contrary to the intention, the latter
shall prevail over the former (CIVIL CODE, Art.
1370, par. 2).
Well-settled is the rule that in case of doubt, it is
the intention of the contracting parties that
prevails (Marquez v. Espejo, G.R. No. 168387,
August 25, 2010).
When the true intent and agreement of the parties
is established, it must be given effect and prevail
over the bare words of the written contract (4
TOLENTINO, supra at 559-560).
3. The contemporaneous and subsequent acts of
the parties shall be considered (CIVIL CODE, Art.
1371).
4. If the terms in a contract are general, they shall
not be understood to comprehend things that are
distinct and different from those which the parties
intended (CIVIL CODE, Art. 1372).
5. If some stipulation should admit of several
meanings, it shall be understood as bearing that
import which is most adequate to render it
effectual (CIVIL CODE, Art. 1373).
6. Various stipulations shall be interpreted together
(CIVIL CODE, Art. 1374).
NOTE: A contract cannot be construed by parts,
but its clauses should be interpreted in relation to
one another. The whole contract must be
interpreted or read together in order to arrive at
its true meaning (4 TOLENTINO, supra at 563).
7. Words with different significations shall be
understood in that which is most in keeping with
the nature and object of the contract (CIVIL
CODE, Art. 1375).
8. Usage or custom of the place shall be considered
in the interpretation of the ambiguities of a
contract and shall fill the omission of stipulations
which are ordinarily established (CIVIL CODE,
Art. 1376).
9. Interpretation of obscure words or stipulations
shall not favor those who caused the obscurity
(CIVIL CODE, Art. 1377).
Rule 123 of the Rules of Court shall likewise be
observed in the construction of contracts (CIVIL
CODE, Art. 1379).
NOTE: When an instrument consists partly of
written words and partly of a printed form, and the
two are inconsistent, the former controls the latter
(RULES OF COURT, Rule 130, Sec. 15).
RULES ON SETTLING DOUBTS IN
CONTRACTS
1. Gratuitous Contracts
– when the doubts refer to its incidental
circumstances, the least transmission of rights
and interests shall prevail (CIVIL CODE, Art.
1378).
2. Onerous Contracts
– the doubt shall be settled in favor of the
greatest reciprocity of interests (CIVIL CODE,
Art. 1378).
3. Principal Object
– if the doubts are cast upon the principal object
of the contract in such a way that it cannot be
known what may have been the intention or will
of the parties, the contract shall be null and void
(CIVIL CODE, Art. 1378).
RESCISSIBLE
CONTRACTS
(ARTS. 1380-1389)
RESCISSIBLE CONTRACTS
These are contracts which are valid but are defective
because of injury or damage to either of the
contracting parties or to third persons and, as a
consequence thereof, it may be rescinded by means
of a proper action for rescission (JURADO,
Obligations and Contracts, supra at 502-503).
CONCEPT OF RESCISSION
Rescission (as contemplated in Articles 1380 to 1389
of the CIVIL CODE) is a remedy granted by law to the
contracting parties and even to third persons, to
secure the reparation of damages (lesion or
pecuniary damage) caused to them by a contract,
even if this should be valid, by restoration of things to
their condition at the moment prior to the celebration
of the contract (Buenviaje v. Spouses Salonga, G.R.
No. 216023, October 5, 2016).
REQUISITES OF RESCISSION:
(VLE-P2NR)
1. The contract must be Validly agreed upon (CIVIL
CODE, Art. 1380);
2. There must be Lesion or pecuniary prejudice or
damage to one of the parties or to a third person
(CIVIL CODE, Art. 1381);
3. The rescission must be based upon a case
Especially provided by law (CIVIL CODE, Art.
1380-1382);
4. The object of the contract must not legally be in
the Possession of third persons who did not act
in bad faith (CIVIL CODE, Art. 1385, par. 2);
5. The Period for filing the action for rescission must
not have prescribed. (CIVIL CODE, Art. 1389);
6. There must be No other legal remedy to obtain
reparation for the damage (CIVIL CODE, Art.
1383); and
7. The party asking for rescission must be able to
Return what he is obliged to restore by reason of
the contract (CIVIL CODE, Art. 1385, par. 1).
RESCISSION UNDER ART. 1911 ONLY
APPLIES IN SUBSTANTIAL BREACH
Rescission of a contract will not be permitted for a
slight casual breach, but only for such substantial and
fundamental breach as would defeat the very object
of the parties in executing the agreement (Vermen
Realty Corp. v. Court of Appeals, G.R. No. 101762,
July 6, 1993).
In order that there may be substantial performance of
an obligation, there must have been an attempt in RESOLUTION FOR
good faith to perform, without any willful or intentional RESCISSION BY
BREACH OF
departure therefrom. The deviation from the REASON OF LESIÓN
STIPULATION (CIVIL
obligation must be slight, and the omission or defect OR DAMAGE
CODE, ART. 1191)
must be technical and unimportant, and must not
pervade the whole or be so material that the object
which the parties intended to accomplish in a As to Party Who May Institute Action
particular manner is not attained. The non-
May be demanded only May be demanded by a
performance of a material part of a contract will
by a party to the third party prejudiced by
prevent the performance from amounting to a
contract. the contract.
substantial compliance (International Hotel Corp. v.
Joaquin, G.R. No. 158361, April 10, 2013). As to Power of the Courts

RESOLUTION FOR BREACH OF May be denied by court Extension of time does

STIPULATION V. RESCISSION BY when there is sufficient not affect the right to ask
REASON OF LESIÓN OR DAMAGE reason to justify the for rescission.
extension of time.
RESOLUTION FOR As to Causes
RESCISSION BY
BREACH OF
REASON OF LESIÓN
STIPULATION (CIVIL Non-performance is the Various reasons of equity
OR DAMAGE
CODE, ART. 1191) only ground for the right are grounds for
to rescission rescission
As to Nature of Action As to Contracts Which May Be Rescinded or
Principal action; Subsidiary action and Resolved
retaliatory action involves partial Applies only to Applies to either
against the other party. resolution. reciprocal obligations reciprocal or unilateral
where one party has obligations and whether
As to Basis failed to comply with the contract has been
what is incumbent upon fully fulfilled or not.
Based on breach of Based on lesion or him.
trust. economic prejudice,
rendering the contract As to Prescriptive Period
rescissible by law. Ten years Four years (CIVIL
.
CODE, Art. 1389)
A subsidiary action based
on injury to the plaintiff’s Similarities
economic interests as
described in Articles 1380 1. Both presuppose contracts validly entered into
and 1381. and existing (this distinguishes rescission from
annulment, in which there is a defect which
vitiates the contract); and
As to Effect
2. Both require mutual restitution when declared
Termination of the Abrogation of the contract
proper.
obligation and release from the beginning and
of the parties from restoration of the parties (Heirs of Sofia Quirong v. Development Bank of the
further obligations from to their relative positions Philippines, G.R. No. 173441 December 3, 2019;
each other. as if no contract has been Congregation of the Religious of the Virgin Mary,
made. et.al., v. Orola, G.R. No. 169790, April 30, 2008).

To declare the contract NOTE: The term “resolution” is based on Art. 1124 of
void at its inception and to the Old Civil Code but the present Code uses the term
put an end to it as though “rescission.”
it never was
CONTRACTS THAT ARE RESCISSIBLE:
(GAFILS)
1. Those which are entered into by Guardians
whenever the wards whom they represent suffer
lesion by more than one-fourth of the value of the
things which are the object thereof;
2. Those agreed upon in representation of
Absentees, if the latter suffer the lesion stated in
the preceding number;
3. Those undertaken in Fraud of creditors when the
latter cannot in any other manner collect the
claims due them;
4. Disposition of Property made in state of
Insolvency whose fulfillment cannot be
compelled at the time;
5. Those which refer to things under Litigation if
they have been entered into by the defendant
without the knowledge and approval of the
litigants or of competent judicial authority
6. All other contracts Specially declared by law to be
subject to rescission (CIVIL CODE, Art. 1381&
2).
CONTRACTS CAUSING LESION IN
VIOLATION OF FIDUCIARY DUTY
1. Those entered into by guardians where the ward
suffers lesion of more than one-fourth (¼) of the
value of the things which are objects thereof;
2. Those agreed upon in representation of
absentees, if the latter suffer lesion by more than
one-fourth (¼) of the value of the things which are
subject thereof (CIVIL CODE, Art. 1381, nos. 1
and 2);
LESION
The injury which one of the parties suffers by virtue of
a contract which is disadvantageous for him. To give
rise to rescission, the lesion must be known or could
have been known at the time of making of the contract
and not due to circumstances subsequent thereto or
unknown to the parties (4 TOLENTINO, supra at
574).
REQUISITES OF ACTION FOR
RESCISSION ON GROUND OF LESION
1. Contract was entered into by a guardian in
behalf of his ward or by a legal representative in
behalf of an absentee (CIVIL CODE, Art. 1381,
Nos. 1 and 2);
2. It was entered into without judicial approval
(CIVIL CODE, Art. 1386);
3. Ward or absentee suffered lesion of more than
¼ of the value of the property which is the object
of the contract (CIVIL CODE, Art. 1381, Nos. 1
and 2);
4. There is no other legal means of obtaining
reparation for the lesion (CIVIL CODE, Art.
1383);
5. Person bringing the action must be able to
return whatever he may be obliged to restore
(CIVIL CODE, Art. 1385, par. 1); and
6. Object of the contract must not be legally in the
possession of a third person who did not act in
bad faith (CIVIL CODE, Art. 1385, par. 2).
In rescission by reason of lesion or economic
prejudice, the cause of action is subordinated to the
existence of that prejudice, because it is the raison
d'être as well as the measure of the right to rescind.
Hence, where the defendant makes good the
damages caused, the action cannot be maintained or
continued, as expressly provided in Articles 1383 and
1384 (Buenviaje v. Spouses Salonga, G.R. No.
216023, October 5, 2016).
ACT OF ADMINISTRATION V. ACT OF
STRICT DOMINION
The guardian (legal representative) is only authorized
to manage the estate of his ward (absentee).
He has no power to dispose of or encumber any part
thereof (CIVIL CODE, Arts. 1647 and 1878 (8) and
FC, Arts. 96 and 124).
NOTE: A guardian is authorized only to manage the
estate of the ward; should he dispose a portion
thereof without authority from the court by way of a
contract, the same is unenforceable under Art.
1403(1], irrespective of whether there is lesion or not
(4 TOLENTINO, supra at 575).
CONTRACTS IN FRAUD OF CREDITORS
Those undertaken in fraud of creditors when the latter
cannot in any manner claim what are due them (CIVIL
CODE, Art. 1381, no. 3);
These are contracts executed with the intention to
prejudice the rights of creditors, and should not be
confused with those entered into without such
intention, even if, as a consequence thereof, some
particular damage may be caused to a creditor (4
TOLENTINO, supra at 575).
DISPOSITION OF PROPERTY IN STATE
OF INSOLVENCY
Payments made in a state of insolvency for
obligations to whose fulfillment the debtor could not
be compelled at the time they were effected are also
rescissible (CIVIL CODE, Art. 1382).
REASON: Where a debtor is insolvent and is
indebted to several debtors, a debtor cannot be
compelled to pay one of them without necessarily
causing fraud or prejudice to the others. This is
because the possibility that the other will be repaid in
the earliest possible time is impaired. There is a
presumption that the creditors who were paid ahead
of the other creditors intended to defraud the others.
REQUISITES BEFORE A CONTRACT
ENTERED INTO IN FRAUD OF
CREDITORS MAY BE RESCINDED:
(CFCP)
1. There is a Credit existing prior to the celebration
of the contract;
2. There is Fraud, or at least, the intent to commit
fraud to the prejudice of the creditor seeking
rescission;
3. Creditor cannot in any legal manner Collect his
credit; and
4. Object of the contract must not be legally in the
Possession of a third person who did not act in
bad faith (JURADO, Obligations and Contracts,
supra at 508).
CONTRACTS IN FRAUD OF CREDITORS
MAY BE VOID
Some contracts entered into to defraud creditors are
VOID and not merely rescissible, such as those
contemplated by:
1. Section 4 of Act No. 3952 (Bulks Sales Law),
2. Section 52 and 58 of R.A. No. 10142 (Financial
Rehabilitation and Insolvency Act)
TRANSFEREE OF PROPERTY MUST BE
IN BAD FAITH
For a contract to be rescinded for being in fraud of
creditors, both contracting parties must be shown to
have acted maliciously so as to prejudice the
creditors who were prevented from collecting their
claims (Union Bank of the Phils. v. Ong, G.R. No.
152347, June 21, 2006).
NOTE: The presumptions under Art. 1387 are
rebuttable and not conclusive (Buencamino v.
Bantug, G.R. No. L-37849, October 5, 1993).
If the case is NOT one for which the law establishes
a presumption of fraud(CIVIL CODE, Art. 1387), the
creditor seeking rescission must prove the existence
of such fraud (Lee v. Bangkok Bank Public Company
Limited, G.R. No. 173349, February 9, 2011).
PRESUMPTION OF FRAUD
1. Alienation by gratuitous title if the debtor has not
reserved sufficient property to pay all of his debts
contracted before alienation (CIVIL CODE, Art.
1387, par. 1);
2. Alienation by onerous title if made by a debtor
against whom some judgment has been
rendered in any instance or some writ of
attachment has been issued (CIVIL CODE, Art.
1387, par. 2).
BADGES OF FRAUD:
1. The fact of inadequate or fictitious cause or
consideration of the conveyance;
2. Transfer by a debtor after suit has been begun
and while it is pending against him;
3. Sale on credit by an insolvent debtor;
4. Evidence of large indebtedness or complete
insolvency
5. Transfer of all or nearly all of debtor’s property by
him, especially when he is insolvent or greatly
embarrassed financially;
6. Transfer between father and son, where others of
the above circumstances are present;
7. Failure of the vendee to take exclusive
possession of the property sold; and
8. Gross disparity between the price and the value
of the property
9. At the time of the conveyance, the vendee was
living with the vendor and the former knew that
there was judgment against the latter;
10. It was known to the vendee that the vendor had
no properties other than that sold to him (Cabaliw
v. Sadorra, G.R. No. L-25650, June 11, 1975);
11. The certificate of title covering the lands sold
remained in the name of the vendor who declared
them for taxation purposes (Castro v. Escutin,
G.R. No. L-27406, May 31, 1979);
12. Where the mortgagor-vendor and mortgagee-
vendee are bosom friends with long history of
trust and intimacy and the element; and
13. Where the seller and the buyer are half-brothers
and the sale was executed and registered about
one month after a decision was rendered against
the seller (Nerona v. IAC, G.R. No. L-42505,
December 26, 1984; DE LEON, Obligations and
Contracts, supra at 733).
NOTE: The above enumeration is not an exclusive
list. When clear and unmistakable, badges of fraud
will serve to destroy the camouflage of validity of a
contract. Where the sale is fictitious and fraudulent,
the action or defense for the declaration of its
inexistence does not prescribe (Id. at 733).
UNAUTHORIZED CONTRACTS OF
THINGS UNDER LITIGATION
Those which refer to things under litigation if they
have been entered into by the defendant without the
knowledge and approval of the litigants or of
competent judicial authority (CIVIL CODE, Art. 1381,
No. 4);
REQUISITES:
1. There is a suit that involves a property; and
2. The DEFENDANT entered into a contract without
the knowledge and approval of the litigants or of
competent judicial authority (JURADO,
Obligations and Contracts, supra at 509).
EXAMPLES OF OTHER CONTRACTS
DECLARED BY LAW TO BE SUBJECT TO
RESCISSION:
1. Partition of inheritance where an heir suffers
lesion of at least one-fourth (¼) of the share to
which he is entitled (CIVIL CODE, Art. 1098);
2. Deterioration of the thing through the fault of the
debtor, if the creditor chooses to rescind (CIVIL
CODE, Art. 1189, no. 4);
3. Right of unpaid seller to rescind (CIVIL CODE,
Art. 1526, no. 4);
4. Deterioration of the object of the sale before its
delivery (CIVIL CODE, Art. 1538);
5. Sale of real estate with a statement of its area, at
the rate of a certain price for a unit of measure or
number, where the vendor failed to deliver the
area stated; the vendee may ask for rescission of
the contract if the lack of area is not less than
one-tenth (1/10) of that stated (CIVIL CODE,
Art.1539, par. 2);
6. The vendee does not accede to the failure of the
vendor to deliver what has been stipulated (CIVIL
CODE, Art. 1542, par. 2);
7. When, through eviction, the vendee loses a part
of the thing sold of such importance, in relation to
the whole, that he would not have bought it
without said part (CIVIL CODE, Art. 1556, par. 1);
8. Sale of immovable encumbered with any non-
apparent burden or servitude, not mentioned in
the agreement, of such nature that it must be
presumed that the vendee would not have
acquired it had he been aware thereof (CIVIL
CODE, Art. 1560, par. 1);
9. Election of the vendee to withdraw from the
contract in the cases under Art. 1561, 1562,
1564, 1565 and 1566 (CIVIL CODE, Art. 1567);
and
10. Rescission by the aggrieved party in a contract of
lease when the other party does not comply with
Art. 1654 and 1657 (CIVIL CODE, Art. 1659).
APPARENT CONFLICT BETWEEN CIVIL
CODE ARTICLE 1382 AND ARTICLE
1198(1) IF THE OBLIGATION IS SUBJECT
TO A SUSPENSIVE PERIOD
Under Article 1382 of the CIVIL CODE, payment
made by an insolvent is rescissible. Under Article
1198(1) of the CIVIL CODE, a debtor can be
compelled to pay by the creditor even before the
expiration of the period since by his insolvency he has
already lost his right to the benefit of such period.
The conflict can easily be resolved by considering the
priority of dates between the two debts. If the
obligation with a period became due before the
obligation to the creditor seeking the rescission
became due, then the latter cannot rescind the
payment even if such payment was effected before
the expiration of the period; but if the obligation with
a period became due after the obligation to the
creditor seeking rescission became due, then the
latter can rescind the payment (DE LEON,
Obligations and Contracts, supra at 510).
ACCION PAULIANA
The action to rescind contracts in fraud of creditors is
known as accion pauliana. Consequently, accion
pauliana presupposes a judgment and an unsatisfied
execution which cannot exist when the debt is not yet
demandable at the time the rescissory action is
brought (4 TOLENTINO, supra at 576).
PARTIES WHO MAY INSTITUTE ACTION:
1. The creditor who is defrauded in rescissory
actions on ground of fraud, and other person
authorized to exercise the same in other
rescissory actions;
2. Their representatives;
3. Their heirs; and
4. Their creditors by virtue of the subrogatory action
defined in Art. 1177 of the CIVIL CODE
(JURADO, Obligations and Contracts, supra at
511).
NOTE: The action for rescission is subsidiary; it
cannot be instituted except when the party suffering
damage has no other legal means to obtain
reparation for the same (CIVIL CODE, Art. 1383).
Rescission shall be only to the extent necessary to
cover the damages caused (CIVIL CODE, Art. 1384).
EFFECT OF RESCISSION
1. As to the parties
– mutual restitution of the objects of the contract,
together with their fruits and the price with its
interest (CIVIL CODE, Art. 1385).
NOTE: This is applicable only to rescissory
actions on the ground of lesion and not to
rescissory actions on the ground of fraud (DE
LEON, Obligations and Contracts, supra at 514).
When it is no longer possible to return the object
of the contract, an indemnity for damages
operates as restitution (Coastal Pacific Trading,
Inc. v. Southern Rolling Mills, G.R. No. 118692,
July 28, 2006).
2. As to third persons
a. In bad faith or not in legal possession –
obliged to return; the creditor who is
prejudiced can run after the third person in
possession of the thing.
NOTE: It is not necessary that the transferee
should have connived with the transferor to
defraud the latter’s creditors. It is enough that
 the transferee knows of the intention of the
transferor to defraud creditors (4
TOLENTINO, supra at 594).
b. In good faith or in legal possession – no
rescission; however, indemnity for damages
may be demanded from the person causing
the loss (CIVIL CODE, Art. 1388).
EXTENT OF RESCISSION
Rescission shall be only to the extent necessary to
cover the damages caused (CIVIL CODE, Art. 1384).
The rescission shall only be to the extent of the
creditor’s unsatisfied credit. The policy of the law is to
preserve or respect the contract, not to extinguish it
(DE LEON, Obligations and Contracts, supra at 716).
PRESCRIPTIVE PERIOD FOR ACTION
FOR RESCISSION:
1. Under Art. 1381, No. 1
– within 4 years from the time of the termination
of the incapacity of the ward
2. Under Art. 1381, No. 2
– within 4 years from the time the domicile of the
absentee is known
3. Under Art. 1381 Nos. 3 and 4 as well as
Art. 1382
– within 4 years from the time of the discovery of
fraud (CIVIL CODE, Art. 1389).
NOTE: In certain cases of contracts of sale which are
specially declared by law to be rescissible, however,
the prescriptive period for the commencement of the
action is 6 months or even 40 days, counted from the
day of delivery (CIVIL CODE, Arts. 1543, 1571, and
1577).
RESCISSION IS NOT ALLOWED WHEN:
1. The party who demands rescission cannot return
what he is obliged to restore under the contract
(CIVIL CODE, Art. 1385, par. 1); and
2. The property is legally in the possession of a third
person who acted in good faith (CIVIL CODE, Art.
1385, par. 2).
VOIDABLE CONTRACTS
(ARTS. 1390-1402)
VOIDABLE CONTRACTS
Contracts where all of the essential elements for
validity are present, although the element of consent
is vitiated either by lack of legal capacity of one of the
contracting parties, or by mistake, violence,
intimidation, undue influence, or fraud. It is binding
until it is annulled by a competent court (JURADO,
Obligations and Contracts, supra at 533).
CHARACTERISTICS OF VOIDABLE
CONTRACTS: (VBC3RD)
1. The defect consists of the Vitiation of consent of
one of the contracting parties;
2. They are Binding until annulled;
3. They are susceptible of Convalidation by
ratification or prescription; and
4. The defect or voidable character cannot be
invoked by 3rd persons (Id. at 531-532).
VOIDABLE OR ANNULLABLE
CONTRACTS: (VIMFU-I)
1. Those where the consent is vitiated by Mistake,
Violence, Intimidation, Undue influence, or Fraud
2. Those where one of the parties is Incapable of
giving consent to a contract (CIVIL CODE, Art.
1390).
NOTE: If both parties are incapable of giving
consent, the contract is unenforceable (CIVIL
CODE, Art. 1403(3)).
PROPER ACTION IN COURT
Art. 1390 of the CIVIL CODE refers to a “proper action
in court.” The validity of a voidable contract may only
be attacked either by way of a direct action or by way
of defense via a counterclaim, and not by a special or
affirmative defense (JURADO, Obligations and
Contracts, supra at 531).
INJURY NOT ESSENTIAL
Even though there are no right to damages between
the contracting parties, the contracts enumerated in
Art. 1390 are still voidable (Id. at 533).
MODES TO EXTINGUISH AN ACTION
FOR ANNULMENT:
1. Prescription (CIVIL CODE, Art. 1391);
2. Ratification (CIVIL CODE, Art. 1392); or
3. Loss of the thing which is the object of the contract
through fraud or fault of the person who is entitled
to institute the action (CIVIL CODE, Art. 1401).
PRESCRIPTIVE PERIOD FOR ACTION
FOR ANNULMENT
1. Contracts entered into by incapacitated
person
– within 4 years from the time guardianship
ceases;
2. Where consent is vitiated by violence,
intimidation or undue influence
– within 4 years from the time such violence,
intimidation or undue influence ceases;
3. Where consent is vitiated by mistake or
fraud
– within 4 years from the time of the discovery of
such mistake or fraud (CIVIL CODE, Art. 1391).
NOTE: These periods apply only to the parties to the
contract and not to 3rd persons (4 TOLENTINO, supra
at 599).
The running of the prescriptive period of 4 years
cannot be interrupted by an extrajudicial demand
made by the party whose consent was vitiated
(Miailhe v. CA, G.R. No. 108991, March 20, 2001).
Mistrust of the courts and of judicial processes is no
excuse for their non-observance of the prescriptive
period set down by law (First Philippine Holdings
Corporation v. Trans Middle East (Phils.) Equities
Inc., G.R. No. 179505, December 4, 2009).
RATIFICATION
The act or means by virtue of which efficacy is given
to a contract which suffers from a vice of curable
nullity (4 TOLENTINO, supra at 600).
FORMS OF RATIFICATION:
1. Express ratification (CIVIL CODE, Art. 1393);
2. Implied ratification
– there is a tacit ratification if, with knowledge of
the reason which renders the contract voidable
and such reason having ceased, the person who
has a right to invoke it should execute an act
which necessarily implies an intention to waive
his right (CIVIL CODE, Art. 1393).
EFFECTS OF RATIFICATION:
1. Extinguishes the action for annulment of a
voidable contract (CIVIL CODE, Art. 1392);
2. Cleanses the contract of its defects from the
moment it was constituted (CIVIL CODE, Art.
1396).
REQUISITES OF RATIFICATION: (VEKD)
1. Contract is tainted with a Vice susceptible of
being cured;
2. Confirmation is Effected by the person who is
entitled to do so under the law;
3. It is effected with Knowledge of the vice or defect
of the contract; and
4. Cause of the nullity or Defect has already
disappeared (JURADO, Obligations and
Contracts, supra at 547).
NOTE: The right to ratify may be exercised by the
guardian of the incapacitated person having such
right (CIVIL CODE, Art. 1394). Ratification does not
require the conformity of the contracting party who
has no right to bring an action for annulment (CIVIL
CODE, Art. 1395).
WHO MAY INSTITUTE ACTION FOR
ANNULMENT
An action for annulment may be instituted by all who
are thereby obliged principally or subsidiarily, except
the following:
1. The party who contracts with an incapacitated
person;
2. The one who caused that which vitiates the
contract or has chargeable knowledge thereof
(CIVIL CODE, Art. 1397).
REQUISITES:
1. Plaintiff must have interest in the contract; and
2. The victim and not the party responsible for the
vice or defect must assert the same (JURADO,
Obligations and Contracts, supra at 550).
A third person who is prejudiced in his rights with
respect to one of the contracting parties, and can
show detriment which would positively result to him
from the contract in which he has no intervention may
seek annulment (Teves v. People’s Homesite &
Housing Corp., G.R. No. L-21498, June 27, 1968).
EFFECTS OF ANNULMENT:
1. If contract has not yet been
consummated
– parties shall be released from the obligations
arising therefrom;
2. If contract has already been
consummated
– rules provided in Art. 1398-1402 shall govern
(JURADO, Obligations and Contracts, supra at
552).
OBLIGATION OF MUTUAL RESTITUTION
1. Obligation to give
– The parties shall restore to each other things
which have been the subject matter of the
contract with fruits and the price with interest,
except in cases provided by law (CIVIL CODE,
Art. 1398).
EXCEPTION: When the defect of the contract
consists in the incapacity of one of the contracting
parties, the incapacitated person is not obliged to
make restitution except insofar as he has been
benefited by the thing or price received by him
(CIVIL CODE, Art. 1399).
 NOTE: The profit or benefit received by the
incapacitated person, which obliges him to make
restitution, is not necessarily a material and
permanent increase in fortune, but any prudent
and beneficial use by the incapacitated of the
thing he received for his necessities, social
disposition or discharge of his duties to others (4
TOLENTINO, supra at 610-611).
It is presumed, in the absence of proof, that no
such benefit has accrued to the incapacitated
person (JURADO, Obligations and Contracts,
supra at 553-554).
Art. 1399 cannot be applied to those cases where
the incapacitated person can still return the thing
which he has received (Id. at 554).
Innocent third parties are not bound to restore
(Peralta v. Heirs of Bernardina Abalon, G.R. No.
183448, June 30, 2014).
2. Obligation to do or not to do
– There will be an apportionment of damages
based on the value of such prestation with
corresponding interests (JURADO, Obligations
and Contracts, supra at 552-553).
EFFECTS OF FAILURE TO MAKE
RESTITUTION
Where the thing is lost:
1. Due to fault of defendant
– he shall return the fruits received and the value
of the thing at the time of loss, with interest from
the same date (CIVIL CODE, Art. 1400);
2. Due to fault or fraud of plaintiff
– the action for annulment shall be extinguished;
3. Due to fault of the incapacitated
– whether the loss occurred during the plaintiff’s
incapacity or after he had acquired capacity, the
action for annulment would still be extinguished
in accordance with Art. 1401, par. 1; and
4. Due to fortuitous event
– contract can still be annulled, but the defendant
can be held liable only for the value of the thing
at the time of loss without interest thereon
(JURADO, Obligations and Contracts, supra at
555-557).
UNENFORCEABLE
CONTRACTS
(ARTS. 1403-1408)
UNENFORCEABLE CONTRACT
Those which cannot be enforced by a proper action
in court unless they are ratified, because, either:
1. They are entered into without or in excess of
authority (CIVIL CODE, Arts. 1403, par. 1 and
1317);
2. They do not comply with the Statute of Frauds
(CIVIL CODE, Art. 1403, par. 2); or
3. Both of the contracting parties are incapable of
giving consent (CIVIL CODE, Art. 1403, par. 3).
CHARACTERISTICS OF
UNENFORCEABLE CONTRACTS:
1. They cannot be enforced by a proper action in
court (CIVIL CODE, Art. 1403);
2. They are susceptible of ratification (CIVIL CODE,
Art. 1403, 1405, 1407, 1371); and
3. They cannot be assailed by third persons (CIVIL
CODE, Art. 1408).
PRINCIPLES UNDER CONTRACTS
ENTERED INTO WITHOUT OR IN EXCESS
OF AUTHORITY:
1. No one may contract in the name of another
without being authorized by the latter or unless
he has a right to represent him. If he is duly
authorized, he must act within the scope of his
powers (CIVIL CODE, Arts. 1317 &1881);
2. A contract entered into in the name of another by
one who has no authority or legal representation,
or who has acted beyond his powers, is
unenforceable (CIVIL CODE, Arts. 1403, par. 1
and 1317); and
3. However, such contract may be ratified,
expressly or impliedly by the person in whose
behalf it has been executed, before it is revoked
by the other contracting party (CIVIL CODE, Art.
1317).
CONTRACTS COVERED BY THE
STATUTE OF FRAUDS
In the following cases, an agreement hereafter made
shall be unenforceable by action, unless the same,
or some note or memorandum thereof, be in writing,
and subscribed by the party charged, or by his agent;
evidence thereof, of the agreement cannot be
received without the writing, or a secondary evidence
of its contents: (1PM-GLSR)
1. An agreement that by its terms is not to be
performed within 1 year from the making thereof;
NOTE: Only full or complete performance by one
party within a year from the execution thereof will
take the case out of the Statute of Frauds
(JURADO, Obligations and Contracts, supra at
563-564).
2. A special Promise to answer for the debt, default
or miscarriage of another;
NOTE: If the promise is an original one or
independent one, that is, the promisor becomes
thereby primarily liable for the payment of the
debt, the promise is not within the statute. But on
the other hand, if the promise is collateral to the
agreement of another and the promisor, the
promise must be in writing (Reiss v. Memije, G.R.
No. 5447, March 1, 1910).
3. An agreement made in consideration of
Marriage, other than a mutual promise to marry
(e.g. Pre-Nuptial Agreement, Marriage
Settlements, and Donation Propter Nuptias);
NOTE: When the marriage is a mere incident,
and the end to be attained by the agreement, the
contract is not in consideration of a marriage, and
oral evidence can prove the agreement (4
TOLENTINO, supra at 622).
4. An agreement for the sale of Goods, chattels or
things in action, at a price not less than P500,
unless the buyer accepted and received such
goods and chattels or evidences or some of
them, of such things in action or pay at the time
some part of the purchase money; but when a
sale is made by auction and entry is made by the
auctioneer in his sales book, at the time of sale,
of the amount and kind of property sold, terms,
price, names of the purchasers and persons to
whose account the sale is made, it is a sufficient
memorandum;
NOTE: Where there is a purchase of a number of
articles which separately do not have a price of
P500 each but has an aggregate sum exceeding
P500, the statute is only applicable if the
transaction is inseparable (Id. at 624).
5. An agreement for the Leasing of real property for
a longer period than one (1) year;
6. An agreement for the Sale of real property or
interest (e.g. usufruct, easement) therein; and
7. A Representation as to the credit of a third
person.
This serves as the basis to an action for damages
against the party who made the representation, if
the same turns out to be false or incorrect.
NOTE: The Statute of Frauds is exclusive, that is, it
applies only to the agreements or contracts
enumerated therein (PINEDA, Obligations and
Contracts, supra at 638).
REASON FOR THE STATUTE OF FRAUDS: To
prevent fraud and perjury in the enforcement of
obligations (DE LEON, Obligations and Contracts,
supra at 763, citing Phil. National Bank v. Phil.
Vegetable Oil Co. Inc., G.R. No. L-25400, January
14, 1927).
REMOVAL FROM COVERAGE OF
STATUTE OF FRAUDS
1. Express or Implied Ratification of a party bound
by it;
2. Partial or Total Performance of the Obligations
under the Contract (Executed Contracts)
3. Execution of one or more Note or Memorandum
in written form and subscribed by the party
charged or his agent (CIVIL CODE, Art. 1403(2)
& 1405).
FULL OR PARTIAL EXECUTION
Contracts infringing the Statute of Frauds, are ratified
by the failure to object to the presentation of oral
evidence to prove the same, or by the acceptance of
benefits under them (CIVIL CODE, Art. 1405).
If a contract has been totally or partially performed,
the exclusion of parol evidence would promote fraud
or bad faith, for it would enable the defendant to keep
the benefits already delivered by him from the
transaction in litigation, and, at the same time, evade
the obligations, responsibilities or liabilities assumed
or contracted by him thereby (Mactan-Cebu
International Airport Authority v. Tudtud, GR 174012,
November 14, 2008).
NOTE: In other words, the Statute only covers
executory contracts. It no longer covers contracts
which have been partially or fully executed.
NOTE OR MEMORANDUM MUST BE
COMPLETE
For a note or memorandum to satisfy the Statute, it
must be complete in itself and cannot rest partly in
writing and partly in parol (Swedish Match, AB v. CA,
G.R. No. 128120, October 20, 2004).
The note or memorandum must contain the names of
the parties, the terms and conditions of the contract,
and a description of the property sufficient to render
it capable of identification. (Swedish Match, AB v. CA, 3. The right to set up the defense of inexistence or
G.R. No. 128120, October 20, 2004). Absolute nullity cannot be waived or renounced
(CIVIL CODE, Art. 1409);
Such note or memorandum must contain the 4. The action or defense for the declaration of their
essential elements of the contract expressed with inexistence or nullity is Imprescriptible (CIVIL
certainty that may be ascertained from the note or CODE, Art. 1410);
memorandum itself, or some other writing to which it 5. The inexistence or absolute nullity of a contract
refers or within which it is connected, without cannot be invoked by a person whose interests
resorting to parol evidence (Swedish Match, AB v. are not Directly affected (Tongoy v. CA, G.R. No.
CA, G.R. No. 128120, October 20, 2004). L-45645, June 28, 1983); and
6. The defense of illegality of contract is not
PRINCIPLES UNDER CONTRACTS available to 3rd persons whose interests are not
WHERE BOTH PARTIES ARE directly affected (CIVIL CODE, Art. 1421).
INCAPACITATED:
VOID V. INEXISTENT CONTRACTS
1. These contracts are also unenforceable (CIVIL
CODE, Art. 1403, par. 3); and INEXISTENT
VOID CONTRACTS
CONTRACTS
2. If only one of the parties is incapacitated, the
contract is voidable (CIVIL CODE Art. 1390, no. As to Requisites
1).
Those where all of the Those where one or
requisites of a contract some or all of the
3. The contract may be ratified by the parents or
are present but the requisites essential for
guardians of the contracting parties, or by the
cause, object or the validity of a contract
parties themselves upon attaining or regaining
purpose is contrary to are absolutely lacking
capacity.
law, morals, good such that it could not
a. Ratification on the part of only one of the
customs, public order or come to existence,
parties – the contract becomes voidable;
public policy, or the whether valid or void.
b. Ratification on the part of both parties – the
contract itself is
contract shall be validated from its inception
prohibited or declared
(JURADO, Obligations and Contracts, supra
void by law.
at 572).
As to Application of Pari Delicto

Principle of in pari Principle of in pari delicto

VOID OR INEXISTENT delicto is applicable. is not applicable.

CONTRACTS As to Effect
(ARTS. 1409-1422) May produce legal Cannot produce any
effects. effect.

As to Scope
VOID OR INEXISTENT CONTRACTS
Covers Art. 1409 Nos. Covers Art. 1409 Nos. 2
In general, they are those which lack absolutely either
1, 3,4,5,6, and 7. and 3.
in fact or in law one or some of the elements essential
for its validity. It has no force and effect from the very (JURADO, Obligations and Contracts, supra at 574-
beginning, as if it has never been entered into, and 575).
which cannot be validated either by time or by
ratification (JURADO, Obligations and Contracts, CONTRACTS WHICH ARE INEXISTENT
supra at 574). AND VOID AB INITIO: (ACE-PI2O)
1. Those whose cause, object or purpose is
Characteristics Of Void Contracts: Contrary to law, morals, good customs, public
(Leg-RAID-3rd) order or public policy;
1. They do not produce any Legal effect (quod 2. Those which are Absolutely simulated or
nullum est nullum producit effectum); fictitious;
2. They are not susceptible of Ratification (CIVIL 3. Those whose cause or object did not Exist at the
CODE, Art. 1409); time of the transaction;
4. Those whose object is Outside the commerce of
men;
5. Those which contemplate an Impossible service;
6. Those where the Intention of the parties relative
to the principal object of the contract cannot be
ascertained; and
7. Those expressly Prohibited or declared void by
law (CIVIL CODE, Art. 1409).
OTHER VOID AND INEXISTENT
CONTRACTS: (ICF)
1. Those which are the direct result of previous
Illegal contracts (CIVIL CODE, Art. 1422);
2. Those where there is no Concurrence between
offer and acceptance with regard to the object
and the cause of the contract; and
3. Those which do not comply with the required
Form where such form is essential for validity
(JURADO, Obligations and Contracts supra at
578).
THE FOLLOWING STIPULATIONS ARE
VOID:
1. Pactum comissorium
– a stipulation that allows the creditor to
automatically appropriate the things given by way
of mortgage or dispose of them upon default of
the obligation(CIVIL CODE, Art. 2088).
2. Pactum de non alienado
– a stipulation forbidding the owner from
alienating the immovable mortgaged (CIVIL
CODE, Art. 2130).
3. Pactum leonina
– a stipulation which excludes one or more
partners from any share of the profits or losses
(CIVIL CODE, Art. 1799).
NOTE: The above enumeration is not exclusive.
PRINCIPLE OF IN PARI DELICTO
When the defect of a void contract consists in the
illegality of the cause or object of the contract and
both of the parties are at fault or in pari delicto, the
law refuses them any remedy and leaves them where
they are (CIVIL CODE, Art. 1411).
EXCEPTIONS:
1. Payment of usurious interest (CIVIL CODE, Art.
1413);
2. Payment of money or delivery of property for an
illegal purpose, where the party who paid or
delivered repudiates the contract before the
purpose has been accomplished, or before any
damage has been caused to a third person
(CIVIL CODE, Art. 1414);
3. Payment of money or delivery of property made
by an incapacitated person, if the interest of
justice so demands (CIVIL CODE, Art. 1415);
4. Agreement or contract not illegal per se but
merely prohibited by law, and the prohibition is
designed for the plaintiff’s protection (CIVIL
CODE, Art. 1416);
NOTE: The exception should not be applied if
public policy will not thereby be enhanced or
subserved (Philippine Banking Corporation v. Lui
She, G.R. No. L-17587, September 12, 1967).
5. Payment of any amount in excess of the
maximum price of any article or commodity fixed
by law (CIVIL CODE, Art. 1417);
6. Contract whereby a laborer undertakes to work
longer than the maximum number of hours fixed
by law (CIVIL CODE, Art. 1418);
NOTE: The laborer may still demand additional
compensation for service rendered beyond the
time limit even if the contract was signed
voluntarily by the laborer (Luzon Stevedoring Co.
Inc. v. Luzon Marine Department Union, G.R. No.
L-9265, April 29, 1957.)
7. Contract whereby a laborer accepts a wage lower
than the minimum wage fixed by law (CIVIL
CODE, Art. 1419);
8. In case of divisible contracts, the legal terms may
be enforced separately from the illegal terms
(CIVIL CODE, Art. 1420); and
9. One who lost in gambling because of fraudulent
schemes practiced on him. He is allowed to
recover his losses (RPC, Art. 315 (3b)) even if
gambling is prohibited (JURADO, Obligations
and Contracts, supra at 602-603).
EFFECTS WHEN BOTH PARTIES ARE AT
FAULT AND THE ACT CONSTITUTES A
CRIMINAL OFFENSE:
1. They shall have no action against each other;
2. Both shall be prosecuted; and
3. The effects or instruments of the crime shall be
confiscated in favor of the government (CIVIL
CODE, Art. 1411).
EFFECTS WHEN ONLY ONE IS AT FAULT
AND THE ACT CONSTITUTES A
CRIMINAL OFFENSE:
1. The guilty party will be prosecuted;
2. The instrument of the crime will be confiscated;
and
3. The innocent one may claim what he has given;
or if he has not given anything yet, he shall not
be bound to comply with his promise (CIVIL
CODE, Art. 1411).

NOTE: Art. 1411, par. 1 of the CIVIL CODE is not

applicable to Art. 1409 par 2 and 3 (JURADO,
Obligations and Contracts, supra at 575).

EFFECTS WHEN BOTH PARTIES ARE AT

FAULT AND THE ACT DOES NOT
CONSTITUTE A CRIMINAL OFFENSE:
1. Neither may recover what he has given by virtue
of the contract; and

2. Neither can demand the performance of the

other’s undertaking (CIVIL CODE, Art. 1412, par.
1).

EFFECTS WHEN ONLY ONE IS AT FAULT

AND THE ACT DOES NOT CONSTITUTE
A CRIMINAL OFFENSE:
1. Guilty party cannot recover what has been given
by reason of the contract, or ask the fulfillment of
what has been promised him;

2. Innocent party may demand the return of what he

has given without any obligation to comply with
his promise (CIVIL CODE, Art. 1412, par. 2).

NOTE: In the principle of in pari delicto where

only one of the contracting parties is at fault, the
non-availability of recovery of the thing given
extends to his heirs. Thus, the heirs may not
institute an action for nullity as the principle
constitutes a bar for action (Liguez v. CA, G.R
No. L-11240, Dec. 18, 1957).
 COMPARATIVE TABLE OF DEFECTIVE CONTRACTS
RESCISSIBLE VOIDABLE UNENFORCEABLE INEXISTENT VOID

As to Defect

Defect is caused by Defect is caused by Defect is caused by lack of Defect is caused Defect is caused
injury/ damage vice of consent required form, authority, or by the absence by illegality or
either to one of the capacity of both parties, not of at least one of invalidity of any
parties or to a third cured by prescription the essential one of its
person requisites. essential
elements, or the
contract itself

As to Status of Contract

Valid and Valid and Cannot be enforced by a Do not, as a general rule, produce
enforceable until enforceable until proper action in court any legal effect
rescinded by a annulled by a
competent court competent court

As to Remedy

Rescission Annulment; Ratification Declaration of Absolute Nullity or

Ratification Inexistence

As to Prescription of Defense or Action

Action for rescission Defense or Action Corresponding action for Defense or Action for the declaration
prescribes in 4 years for annulment recovery, if there was total of nullity or inexistence do not
prescribes in 4 years or partial performance of prescribe
the unenforceable contract
under nos. 1 or 3 of Article
1403, may prescribe

As to Real Party In Interest

Contracting parties Contracting parties Contracting parties Contracting parties and a third
and a third person person whose interest is directly
who is prejudiced or affected
damaged by the
contract

As to Susceptibility of Ratification

Need not be ratified Can be ratified Can be ratified Cannot be ratified

As to How Contracts May Be Assailed

Assailed directly or Assailed directly May be assailed only by a Assailed directly or collaterally
collaterally only contracting party
 REMEDIES AVAILABLE AGAINST DEFECTIVE CONTRACTS
PARTY WHO MAY PERIOD TO BRING AN ACTION
DEFECTIVE CONTRACT
INSTITUTE AN ACTION FOR RESCISSION/ANNULMENT

Rescissible Contracts

1. Contracts entered into by guardians By ward Within four years from gaining capacity
whenever the wards whom they
represent suffer lesion by more than
¼ of the value of the things which are
objects thereof;

2. Contracts agreed upon in By absentee Within four years from knowledge of

representation of absentees, if the domicile or knowledge of fraudulent
latter suffers lesion by more than ¼ contract
of the value of the things which are
subject thereof;

3. Contracts undertaken in fraud of By creditor Within four years from knowledge of

creditors when the latter cannot in fraudulent act
any manner collect the claims due
them;

4. Payments made in a state of By creditor

insolvency for obligations whose
Within four years from knowledge of
fulfillment the debtor could not be
fraudulent contract
compelled at the time they were
effected

5. Contracts which refer to the things By party litigant

under litigation if they have been
Within four years from knowledge of
entered into by the defendant without
fraudulent contract
the knowledge and approval of the
litigants and the court

Voidable Contracts

1. Contracts where one of the parties is By party who is Within four years from gaining or
incapable of giving consent to the incapacitated regaining capacity to act
contract

2. Contracts where the consent is By party whose consent Within four years from cessation of
vitiated by mistake, violence, was vitiated force, intimidation or undue influence;
intimidation, undue influence or fraud within four years from discovery of
fraud or mistake

Unenforceable Contracts

1. Contract entered into in the name of Person in whose name the At any time whenever one party
another person without authority or in contract is entered into attempts to enforce the contract
excess of authority against another through court action

2. Contract entered into which does not By party against whom the
comply with the Statutes of Fraud contract is being enforced

3. Contract where both contracting By parents or guardians of

parties do not possess the required both parties, or both
legal capacity parties after regaining
capacity to act
 PARTY WHO MAY PERIOD TO BRING AN ACTION
DEFECTIVE CONTRACT
INSTITUTE AN ACTION FOR RESCISSION/ANNULMENT

Void or Inexistent Contracts

1. Contract whose cause, object or By innocent party; Imprescriptible

purpose is contrary to law, good By 3rd persons whose
customs, morals, public order or interests are directly
public policy affected

2. One or some of essential requisites By any of the contracting

of valid contract is lacking in fact or in parties;
law: By 3rd persons whose
a. Absolutely simulated interests are directly
b. Cause or object did not exist affected
c. Object is outside the commerce
of man
d. Contemplate an impossible
service
e. Intention of parties relative to the
principal object of contract
cannot be ascertained

3. Contracts expressly prohibited by By the party in whose

law protection the prohibition
of the law is designed;
By 3rd party whose
interests are directly
affected
 NOTE: Article 2052 provides that natural obligations
NATURAL OBLIGATIONS may be guaranteed. In principle, however, a natural
obligation cannot be guaranteed, because the
(ARTS. 1423-1430) liability of the guarantor presupposes that there must
be a prior exhaustion of the property of the principal
debtor, and that the guarantor after paying can
recover from the principal debtor – and both of this
NATURAL OBLIGATIONS cannot be legally done when the obligation is natural
Those based on equity and natural law, which do not (Id. at 651).
grant a right of action to enforce their performance,
but after voluntary fulfillment by the obligor, ILLICIT OBLIGATIONS
authorize the retention of what has been delivered or Obligations which are contrary to morals and good
rendered by reason thereof (CIVIL CODE, Art. customs do not constitute natural obligations, and,
1423). therefore, whatever is paid under such obligations
can be recovered, without prejudice to the provisions
NOTE: The binding tie of these obligations is in the of Articles 1411 and 1412 (Id. at 651).
conscience of man, for under the law, they do not
have the necessary efficacy to give rise to an action
(4 TOLENTINO, supra at 646).
NATURAL OBLIGATION
V. MORAL OBLIGATION
NECESSITY OF JURIDICAL TIE NATURAL
MORAL OBLIGATION
In order that there may be a natural obligation there OBLIGATION
must be a juridical tie which is not prohibited by law
and which in itself could give a cause of action but As to Juridical Tie
because of some special circumstances is actually
There is a juridical tie No juridical tie
without legal sanction or means of enforcing
between the parties whatsoever.
compliance by intervention of courts (4
which is not enforceable
TOLENTINO, supra at 646).
by court action
TWO CONDITIONS NECESSARY FOR As to Legal Effect of Voluntary Fulfillment
NATURAL OBLIGATIONS:
Voluntary fulfillment of Voluntary fulfillment of
1. That there be a juridical tie between two
persons; and such produces legal such does not produce
2. That this tie is not given effect by law. effects which the court any legal effect which
will recognize and the court will recognize
NOTE: The first requirement distinguishes the protect. and protect.
natural obligation from the moral, and the second As to Domain
distinguishes it from the civil (4 TOLENTINO, supra
at 646). Within the domain of Within the domain of
law. morals.
CONVERSION INTO CIVIL OBLIGATION
(4 TOLENTINO, supra at 647-649).
The promise to perform a natural obligation is as
effective as performance itself and converts the
obligation into a civil obligation (Id. at 649).
NATURAL OBLIGATION
V. CIVIL OBLIGATION
NOTE: A natural obligation may also be converted NATURAL OBLIGATION CIVIL OBLIGATION
into a civil obligation by novation or by confirmation
or ratification (Id. at 650). As to Basis

Example: Acknowledgement of a prescribed debt. Is based on equity and Based on positive

natural law. law.
EFFECT OF PARTIAL PAYMENT As to Enforceability by Court Action
As a general rule, partial payment of a natural
obligation does not make it civil; the part paid cannot Not enforceable by court Enforceable by court
be recovered but payment of the balance cannot be action. action.
enforced (Id. at 651).
(JURADO, Obligations and Contracts, supra at 635).
EXAMPLES OF NATURAL
OBLIGATIONS:
1. Performance after the civil obligation has
prescribed (CIVIL CODE, Art. 1424);
2. Reimbursement made to a third person who paid
for a debt that has prescribed (CIVIL CODE, Art.
1425);
3. Performance after action to enforce civil
obligation has failed (CIVIL CODE, Art. 1428);
4. Payment by heir of debt exceeding value of
property inherited (CIVIL CODE, Art. 1429); and
5. Payment of legacy after the will has been
declared void (CIVIL CODE, Art. 1430).
RESTITUTION BY MINOR
After a decree of annulment of a contract, the parties
are generally bound to make restitution. When the
ground for annulment, however, is the incapacity of
the plaintiff, he is not bound to make restitution
except to the extent that he was benefited.
However, he has a natural obligation to do so; hence
under Article 1426, if he voluntarily makes restitution,
he cannot recover what he has delivered, if he is a
minor over 18 years of age. A minor of such age is
deemed to have sufficient mental and moral
development to be aware of his debt of conscience
(4 TOLENTINO, supra at 652).
PAYMENT BY MINOR
Article 1427 deals with voluntary payment by minor
over 18 years of age under an annullable contract.
There is no natural obligation in the situation
contemplated by this Article; the obligation here is a
civil obligation, which exists and is enforceable
unless it is set aside or annulled by competent court
in an action for that purpose (Id. at 653).
ESTOPPEL
(ARTS. 1431-1439)
ESTOPPEL
Through estoppel, an admission or representation is
rendered conclusive upon the person making it, and
cannot be denied or disproved as against the person
relying thereon (CIVIL CODE, Art. 1431).
NOTE: Estoppel is the condition where a person is
rendered unable to deny an admission or
representation made to the person who had already
relied on such admission in good faith (PNB v. IAC,
G.R. No. 66715, September 18, 1990).
DISTINGUISHED FROM WAIVER
A waiver is a voluntary and intentional abandonment
or relinquishment of a known right. It carries no
implication of fraud. It involves the act or conduct of
only one of the parties. An equitable estoppel may
arise, however, even where there is no intention on
the part of the person estopped to relinquish any
existing right, and frequently carries the implication
of fraud. It involves the conduct of both parties (4
TOLENTINO, supra.at 657).
DISTINGUISHED FROM RATIFICATION
The party in ratification is bound because he
intended to be; in the latter, he is bound
notwithstanding the fact that there was no such
intention, because the other party will be prejudiced
and defrauded by his conduct unless the law treats
him as legally bound (Id. at 657).
Kinds of Estoppel:
1. Estoppel in pais or by conduct
– Applies to a situation where, because of
something which a person has done or omitted
to do, a party is denied the right to plead or prove
an otherwise important fact (Id. at 664).
a. Estoppel by silence (e.g., CIVIL CODE,
Art. 1437);
b. Estoppel by acceptance of benefits (e.g.,
CIVIL CODE, Art. 1438)
c. Promissory estoppel – a promise to do or
not to do results in estoppel, provided that
the promise which was intended to be relied
upon, was relied upon and the refusal to
enforce it would sanction fraud or injustice (4
TOLENTINO, supra at 658).
Elements (CIK):
a. Conduct amounting to false representation
or concealment of material facts, or at least
calculated to convey the impression that the
facts are otherwise than, and inconsistent
with, those which the party subsequently
attempts to assert;
b. Intent, or at least expectation that this
conduct shall be acted upon by, or at least
influence, the other party; and
c. Knowledge, actual or constructive, of the
real facts (Id. at 664).
2. Technical estoppels:
a. Estoppel by deed – a party to a deed is
precluded from asserting as against the
other party, any material fact asserted
therein; and
b. Estoppel by record – a party is precluded
from denying the truth of matters set forth in
a record, whether judicial or legislative
(JURADO, Obligations and Contracts, supra
at 640).
3. Estoppel by judgment
– a party to a case is precluded from denying the
facts adjudicated by a court of competent
jurisdiction (RULES OF COURT, Rule 39,
Section 47(b));
4. Estoppel by laches
– failure or neglect for an unreasonable and
unexplained length of time, to do that which, by
exercising due diligence, could or should have
been done earlier (Regalado v. Go, G.R. No.
167988, February 6, 2007).
EXAMPLES OF ESTOPPEL:
1. If a person, in representation of another sells or
alienates a thing, the former cannot
subsequently set up his title as against the buyer
or grantee (CIVIL CODE, Art. 1435).
2. A lessee or bailee is estopped from asserting
title to the thing leased or received, as against
the lessor or bailor (CIVIL CODE, Art. 1436).
Estoppel of Tenant
A tenant will not be heard to dispute his
landlord’s title. Once the contract of lease is
shown to exist between the parties, the lessor
cannot be compelled to prove his title thereto
(TOLENTINO, supra at 665).
3. When in a contract between third persons
concerning immovable property, one of them is
misled by a person with respect to the ownership
or real right over the real estate, the latter is
precluded from asserting his legal title or interest
therein, provided all the following requisites are
present: (FIUA)
a. There must be Fraudulent representation or
wrongful concealment of facts known to the
party estopped;
b. The party precluded must Intend that the
other should act upon the facts as
misrepresented;
c. The party misled must have been Unaware
of the true facts; and
d. The party defrauded must have Acted in
accordance with the misrepresentation
(CIVIL CODE, Art. 1437).
SUBSEQUENT ACQUISITION OF TITLE
Although plaintiff’s father did not obtain title to the
land until some years after he had sold such land,
his subsequent acquisition of the land would have
the effect of making his conveyance of the same to
defendant valid. A person who sells a property when
he did not have title to it, cannot deny validity to the
sale after he has acquired title (See CIVIL CODE,
Art. 1434; Inquimboy v. Cruz, G.R. No. L-13953, July
26, 1960).
ESTOPPEL AGAINST OWNER
When in a contract between third persons
concerning immovable property, one of them is
misled by a person with respect to the ownership or
real right over the real estate, the latter is precluded
from asserting his legal title or interest therein,
provided all these requisites are present:
1. There must be fraudulent representation or
wrongful concealment of facts known to the
party estopped;
2. The party precluded must intend that the other
should act upon the facts as misrepresented;
3. The party misled must have been unaware of the
true facts; and
4. The party defrauded must have acted in
accordance with the misrepresentation (CIVIL
CODE, Art. 1437).
NOTE: The rule is well-settled that the title to land or
real property may pass by an equitable estoppel
which is effectual to take the title to land from one
person and vest it in another where justice requires
that such action be done. Thus, by intentional
misrepresentation, misleading conduct, or wrongful
concealment, a person may preclude himself from
asserting his legal title to land or from enforcing an
encumbrance on, or maintaining an interest in, real
estate (DE LEON, Obligations and Contracts, supra
at 962).
ESTOPPEL BY ACCEPTANCE OF
BENEFITS
One who has allowed another to assume apparent
ownership of personal property for the purpose of
making any transfer of it, cannot, if he received the
sum for which a pledge has been constituted, set up
his own title to defeat the pledge of the property,
made by the other to a pledgee who received the
same in good faith and for value (CIVIL CODE, Art.
1438).
(The laws on pledges and chattel mortgage are
repealed by RA 11057 otherwise known as the
Personal Property Security Act (hereinafter PPSA).
Based on Section 68 and 26 of the PPSA, the
implementation of this act shall be conditioned upon
the establishment and operation of the Registry).
NOTE: Estoppel is frequently based upon the
acceptance and retention by one having knowledge
or notice of the facts, of benefits from a transaction,
contract, instrument regulation, or statute which he
might have rejected or contested. It has been said
that the case is referable, when no fraud, either
actual or constructive, is involved to the principles of
ratification (See CIVIL CODE, Arts. 1317, 1403 (1),
and 1405) rather than to those of estoppel.
The result produced, however, is clearly the same, REASON: Mutuality is an essential element of
and the distinction is not usually made. Such estoppel; and estoppel must bind both parties or
estoppel precludes one who accepts the benefits neither is bound (DE LEON, Obligations and
from repudiating the accompanying or resulting Contracts, supra at 964).
obligation, and may operate to prevent a party from
profiting by his own wrong (DE LEON, Obligations Thus, a grantor is not estopped by his deed as
and Contracts, supra at 962-963). against one who is neither a party thereto nor in
privity with a party. If anybody may be heard to
Examples: challenge the application of the doctrine of estoppel,
1. It has been held that where an employee had it is only the party against whom it may be invoked
accepted the benefits accruing from the abolition (Id. at 964).
of his office by enjoying his unused vacation and
sick leave and receiving the corresponding The government, however, is not estopped by the
gratuity, he is estopped from questioning its mistake or error on the part of its officials or agents
validity or deemed to have waived the right to (Id. at 964; Luciano v. Estrella, G.R. No. L-30306,
contest the same (Magana v. Auditor General, January 31, 1969), especially true when the
G.R. No. L-12180, April 26, 1960). government's actions are sovereign in nature (Hi-
Lon Manufacturing Inc. v. COA, G.R. No. 210669,
2. In a case, the appointees, having accepted the August 01, 2017).
acting appointments (as acting Mayor, Vice-
Mayor, and councilors of a newly created
municipality) extended to them without any
protest or reservation, and having acted LACHES
thereunder for a considerable time, the court
ruled that they “cannot now be heard to say that
such appointments were, in reality, permanent
and that, by reason of their being so, they could LACHES OR “STALE DEMANDS”
not be removed, except for cause, before the
Failure or neglect, for an unreasonable and
end of the term for which they were supposedly
unexplained length of time, to do that which, by
appointed” (Cabiling v. Pabualan, G.R. No. L-
exercising due diligence, could or should have been
21764, May 31, 1965).
done earlier; it is the negligence or omission to
assert a right within a reasonable time, warranting a
3. But the plaintiff’s acceptance of the offer of
presumption that the party entitled to assert it either
settlement of the defendant should not be
has abandoned it or declined to assert it (Tijam v.
deemed a waiver of the action where his
Sibonghanoy, G.R. No. L-21450, April 15, 1968;
acceptance was conditional and the condition
Department of Education v. Casibang, G.R. No.
was not accepted. The doctrine of estoppel
192268, January 27, 2016).
cannot, therefore, be slapped against him
(Switzerland Gen. Ins. Co., Ltd. v. Java Pacific &
NOTE: Laches operates not really to penalize
Hoegh Lines, G.R. No. L-21760, April 30, 1966).
neglect or sleeping on one's rights, but rather to
avoid recognizing a right when to do so would result
4. Quitclaims executed by laborers are commonly
in a clearly inequitable situation (Spouses Sierra v.
frowned upon as contrary to public policy and
PAIC Savings and Mortgage Bank, Inc., G.R. No.
ineffective to bar claims for the full measure of
197857; September 10, 2014).
the workers’ rights under the law. Acceptance of
benefits such as separation pay by employees
NOTE: While a person may not acquire title to the
does not amount to estoppel (Blue Bar Coconut
registered property through continuous possession,
Phils., Inc. v. NLRC, G.R. No. 95914, May 5,
the heir of the latter may lose his right to recover
1992).
back the possession of the property and the title
thereto, by reason of laches. The petitioners' laches
PERSONS AFFECTED BY ESTOPPEL extends to his heirs, since they stand in privity with
Estoppel is effective only as between the parties him (Heirs of Lacamen v. Heirs of Laruan, G.R No.
thereto or their successors in interest (CIVIL CODE, 27088, July 31, 1975).
Art. 1439).
ELEMENTS OF LACHES (CDLI):
NOTE: A stranger to a transaction is neither bound
1. Conduct on the part of the defendant, or of one
by, nor in a position to take advantage of, an
under whom he claims, giving rise to the
estoppel arising therefrom (Resuena v. CA, G.R. No.
situation of which complaint is made and for
128338, March 28, 2005).
which the complaint seeks a remedy;
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 complaint would assert the
right on which he bases his suit; and

4. Injury or prejudice to the defendant in the event

relief is accorded to the complainant, or the suit
is not held to be barred (Pangasinan v. Disonglo
Almazora, G.R. No. 200558, July 1, 2015).

PRESCRIPTION V. LACHES
PRESCRIPTION LACHES

As to its Relation to Delay

Concerned with the fact Concerned with the

of delay. effect of delay.

As to Nature

Question or matter of Question of inequity of

time. permitting the claim to
be enforced.

As to Basis

Statutory Not statutory

As to Application

Applies in law Applies in equity

As to Availability as a Defense

Cannot be availed of Being a defense in

unless it is specifically equity, it need not be
pleaded as an specifically pleaded.
affirmative allegation.

As to Basis in Respect of Fixed Time

Based on a fixed time. Not based on a fixed

time.
(JURADO, Obligations and Contracts, supra at 648-
649).
 deposit, guardianship, and agency, in that the
TRUSTS trustee has legal title to the property (Heirs of
Labanon v. Heirs of Labanon, G.R. No. 160711,
August 14, 2007).

TRUST (FIDEICOMISSO) Not all Trusts are Contracts

A trust, either express or implied, is the fiduciary
relationship between one person having an
equitable ownership of property and another person
owning the legal title to such property, the equitable
ownership of the former entitling him to the
performance of certain duties and the exercise of
certain powers by the latter (Goyanko Jr. v. United
Coconut Planters Bank, G.R. No. 179096, February
6, 2013).
In its technical legal sense, a trust is defined as the
right, enforceable solely in equity, to the beneficial
enjoyment of property, the legal title to which is
vested in another, but the word "trust" is frequently
employed to indicate duties, relations, and
responsibilities which are not strictly technical trusts
(Peñalber v. Ramos, G.R. No. 178645, January 30,
2009).
NOTE: Trust denotes “confidence,” “fiduciary
relationship,” etc. and is often used in reference to
the confidential aspect of any kind of a bailment or
possession by one person of the property of another
(DE LEON, Comments and Cases on Partnership,
Agency and Trusts (2019), p. 629, [hereinafter, DE
LEON, Partnership, Agency & Trusts]).
There is a fiduciary relation between the trustee and
the beneficiary (cestui que trust) as regards certain
property, real, personal, money or choses in action
(Peñalber v. Ramos, G.R. No. 178645, January 30,
2009).
Difference of Trust from Other Relationships of a
Fiduciary Character
This legal relationship can be distinguished from
other relationships of a fiduciary character, such as
Express trusts are created by the intention of the
trustor or of the parties (NEW CIVIL CODE, Art.
1441). Express trusts therefore comply with the
elements of a contract: consent, object, and cause
(NEW CIVIL CODE, Art. 1318).
NOTE: This is why express trusts are sometimes
referred to as conventional trusts.
Implied trusts however are created by operation of
law (NEW CIVIL CODE, Art. 1441). The obligations
between the parties in an implied trust are created
by law as a matter of equity in recognition of the trust
relation between them. They are created with or
without the consent of the parties to the relation.
GENERAL PROVISIONS
ARTS. 1440-1442
PERSONS INVOLVED IN A TRUST
1. Trustor
– The person who establishes the trust (CIVIL
CODE, Art. 1440).
2. Trustee
– The one in whom confidence is reposed as
regards property for the benefit of another
person (CIVIL CODE, Art. 1440).
3. Beneficiary or the cestui que trust
– The person for whose benefit the trust has
been created (CIVIL CODE, Art. 1440).

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA R. TAMPUS, Vice
Chairperson for Secretariat | ARVY KEITH N. CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice
Chairperson for Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. THERESA GENEVIEVE NUEVE-CO and Atty. LUIS MANUEL BUGAYONG

 NOTE: The trust may provide for more than one TRUST V. CONTRACT
beneficiary (DE LEON, Partnership, Agency &
Trusts, supra at 642). TRUST CONTRACT

Always involves A legal obligation based

TRUSTOR AS TRUSTEE OR ownership, embracing on an undertaking
BENEFICIARY a set of rights and supported by a
The trustor may establish a trust with him as the duties fiduciary in consideration, which
trustee or the beneficiary. He cannot, however, be character, which may obligation may or may
both the sole trustee and the sole beneficiary of a be created by a not be fiduciary in
single trust (Id. at 642). declaration without character.
consideration.
CHARACTERISTICS OF A TRUST (Id. at 641).
1. It is a relationship;
2. It is a relationship of fiduciary character; TRUST V. AGENCY
3. It is a relationship with respect of property not
involving merely personal duties; TRUST AGENCY
4. It involves the existence of equitable duties
imposed upon the holder of the title to the As to Transfer of Title and Control
property to deal with it for the benefit of another;
and Title and control of the Agent merely represents
5. It arises as a result of a manifestation to create property under the trust and acts for his
the relationship (Morales v. Court of Appeals, instrument passes to principal.
G.R. No. 117228, June 19, 1997). the trustee who acts in
his own name.
CHARACTER OF OFFICE OF TRUSTEE
1. As principal As to Termination
– The trustee is not an agent of the trust estate
or of the cestui que trust, but he acts for himself
Trust may ordinarily be Agency may in general
in the administration of the trust estate, although
terminated only by the be revoked at any time.
subject to the terms of the trust and the law of
fulfillment of its
trusts.
purpose.
2. As agent
– In some cases, however, a trustee has been
TRUST AGENCY
regarded as an agent of beneficiaries of the trust
at least for certain purpose, such as for the
purpose of imputing to the beneficiaries of the As to The Extent of Supervision
trust notice given to the trustee.
Trust is based on the Agency is formed with
3. As fiduciary idea of discretion in the the thought of constant
– A trustee holds an office of trust. A trustee has trustee and guidance supervision and control
a duty of loyalty. He has the obligation to avoid by the settler or cestui by the principal.
conflicts of interest with the beneficiary, and only to a limited extent
even potential conflicts of interest. He is and when expressly
expected to exercise the degree of care, provided for.
prudence and skill that a reasonably prudent (Id. at 372).
person would exercise in administering and
protecting his own property (Id. at 644-645). TRUST V. USUFRUCT
TRUST DISTINGUISHED FROM OTHER TRUST USUFRUCT
RELATIONS As to Transfer of Title
What distinguishes a trust from other relations is the
separation of the legal title and the equitable Trustor transfers legal The owner transfers only
ownership of the subject property between two or title to the trustee. He beneficial title to the
more people (Id. at 640). may retain beneficial usufructuary, retaining
title for himself, or also legal title for himself.
transfer beneficial title
to a third person.
 TRUST USUFRUCT TRUST V. LEASE
TRUST LEASE
As to Existence of Fiduciary Relationship
As to Title Transferred
There is a fiduciary There is no fiduciary
relationship between relationship between the Trustor transfers title to Lessor retains naked
a trustee and a naked owner and two persons: the trustee title, transferring only
beneficiary. usufructuary. and beneficiary, with beneficial right to use
the former acquiring and possess to the
As to the Preservation of The Property legal title and the latter lessee.
acquiring beneficial title.
It is the trustee, the It is the usufructuary who
naked title holder, who is obliged to preserve the NOTE: Trustor may
actively manages and form and substance of the also merely transfer
administers the trust property held in usufruct, naked title to the trustee
property, and the and to take care of it with while retaining
beneficiary mainly is a the diligence of a good beneficial title as
passive receiver of the father of a family for the beneficiary.
fruits and benefits benefit of the naked title
arising from the trust holder at the end of the As to Cause of Contract
property. usufruct.
Essence of the contract Essence of the contract
(VILLANUEVA, Agency &Trusts, Partnerships & is for the trustee to is the enjoyment of the
Joint Ventures, (2018), p.300 [hereinafter, manage the trust possession and use of
VILLANUEVA, Agency &Trusts, Partnerships & property as the legal the leased property.
Joint Ventures]). title holder for benefit or
interest of the
TRUST V. SALE beneficiary.
TRUST SALE As to Term of Beneficial Title
As to Perfection Benefits enjoyed by the Benefits enjoyed by the
beneficiary are usually lessee are only for a
A trust requires the Perfected by mere
of a permanent nature. limited contracted
actual delivery of the consent (CIVIL CODE,
period.
naked or legal title to the Art. 1475).
trustee. (Id. at 300).

As to Ownership of Property Holder TRUST V. DONATION

Trustee merely holds Buyer takes both legal TRUST DONATION
naked title. Beneficial and equitable
title is vested in the ownership of the As to Nature
trustor/beneficiary. property sold.
A trust is an existing Donation is a transfer of
As to Purpose of Acquisition of Legal Title legal relationship and property and involves a
involves the separation disposition of both legal
Constituted merely as a Entered into for its own legal and equitable title and equitable
preparatory end, the acquiring of (DE LEON, supra at ownership.
arrangement, a title of the subject 630).
medium, by which the matter by the buyer.
trustee is expected to As to Form of Acceptance of Benefit
pursue other juridical
acts for the benefit of Beneficiary need not The donee must comply
the beneficiary. execute any formal with the formal
acceptance in order torequirements in
(Id. at 301). enforce his rights. accepting donations
under Article 749 of the
NOTE: Acceptance of New Civil Code.
beneficiary necessary
(NEW CIVIL CODE, Art.
1446).
TRUST V. STIPULATION POUR AUTRUI
STIPULATION POUR
TRUST
AUTRUI
As to Origin
A trust may exist A stipulation pour autrui
because of legal can arise only in the
provision or because of case of contracts.
an agreement.
As to Subject Property
A trust refers to a A stipulation pour autrui
specific property. refers to specific
property or to other
things.
(4 PARAS, supra at 889).
TRUST PROPERTY
The property so held is referred to as the “trust
property” or “trust res”, which is the subject matter of
the trust. The subject matter of a trust may be any
property of value – real, personal, funds or money,
or choses in action (DE LEON, Partnership, Agency
& Trusts, supra at 642-643).
Property Must be Existing
It must consist of property actually in existence in
which the trustor has a transferable interest or title
although it may, as a rule, be any kind of transferable
property either realty or personalty including
undivided, future, or contingent interest therein. But
it cannot be a mere expectancy without right or
interest or a mere interest in the performance of a
contract although such interest is in the nature of a
property right (Id. at 643).
NATURE OF OWNERSHIP OF TRUSTEE
AND BENEFICIARY
The trust property is owned by two persons at the
same time, the relation between the two owners
being such that one of them is under an obligation to
use his ownership for the benefit of the other. The
former is called the trustee, and his ownership is
trust-ownership; the other is called the beneficiary,
and his is beneficial ownership (Id. at 643).
The ownership of the trustee is a mere matter of form
rather than substance, and nominal rather than real.
The trustee is not a mere agent, but an owner. A
trustee is a person to whom the property of someone
is fictitiously attributed by the law, to the extent that
the rights and powers thus vested in a nominal
owner shall be used by him on behalf of the real
owner (Id. at 644).
The interest of the beneficiary in the trust can, in
general, be reached by his creditors, and he can sell
or otherwise dispose of them. The beneficiary can
transfer only the interest he holds – the equitable title
(Id. at 644).
NECESSITY OF EXISTENCE OF
BENEFICIARY
A trust is not void for indefiniteness if the whole
property will go to beneficiaries who will be
determined at the termination of the trust, at the
latest (e.g., “my minor children”, “my brothers and
sisters”). It is not necessary to the creation of a trust
that the cestui que trust be named or identified or
even be in existence at the time of its creation (Id. at
646).
KINDS OF TRUSTS
Trusts are either:
1. Express Trusts
Express trusts are created by the intention of
the trustor or of the parties (NEW CIVIL CODE,
Art. 1441).
2. Implied Trusts
Implied trusts come into being by operation of
law (NEW CIVIL CODE, Art. 1441).
TYPES OF IMPLIED TRUSTS
1. Resulting trust
One in which the intention to create a trust is
presumed by law to exist from the transaction
and facts of the case.
Example: Includes those contemplated under
Articles 1448, 1449, 1451, 1452, 1453 of the
Civil Code (NEW CIVIL CODE, Art. 1447).
(Please refer to page 517 herein).
2. Constructive trust (trust ex malefacio,
trust ex delicto, and de son tort)
One imposed by law irrespective of and even
contrary to the intention of the parties. It is
designed to promote justice, frustrate fraud and
prevent unjust enrichment (DE LEON,
Partnership, Agency & Trusts, supra at 647).
Example: Includes, but is not limited to, those
contemplated under Articles 1450, 1454, 1455,
1456 of the Civil Code (NEW CIVIL CODE, Art.
1447)
(Please refer to page 518 herein).
 EXPRESS TRUST V. IMPLIED TRUST 2. As to revocability
– From the viewpoint of whether they may be
EXPRESS TRUST IMPLIED TRUST
revoked by the trustor, they may be either:
As to Creation
a. Revocable trust – one which can be revoked
Created by the intention Comes into being by or cancelled by the trustor or
of the trustor or parties operation of law (NEW another individual given the power; or
(NEW CIVIL CODE, Art. CIVIL CODE, Art. b. Irrevocable trust – one which may not be
1441). 1441). terminated during the specified term of the
trust (Id. at 647-648).
As to Proof of Trust

An express trust over an An implied trust,

immovable property or
any interest therein
whether the property
subject to trust is real or
EXPRESS TRUSTS
cannot be proved by personal may be proved ARTS. 1443-1446
parol evidence (NEW by oral evidence (NEW
CIVIL CODE, Art. CIVIL CODE, Art.
1443). 1457).
ELEMENTS OF AN EXPRESS TRUST:
As to Prescription (CORB-DA)
Imprescriptible; the Being obligations 1. Competent trustor and trustee;
property held in trust created by operation of 2. Ascertainable trust Res; and
can be recovered law, actions to enforce 3. Sufficiently certain Beneficiaries
anytime implied trusts 4. A present and complete Disposition of the trust
prescribed in 10 years property;
EXCEPTION: If there is from the time the cause 5. Establishment of some power of Administration
repudiation of express of action arises (NEW other than a mere duty to perform a contract
trust, the action for CIVIL CODE, Art. 1144 although the contract is for a third party
reconveyance (2)). beneficiary (Goyanko Jr. v. United Coconut
prescribes 10 years Planters Bank, G.R. No. 179096, February 6,
from the repudiation of 2013).
trust (AQUINO,
Reviewer on Civil Law INTENT TO CREATE A TRUST MUST BE
(2018) p. 622). DEFINITELY ESTABLISHED
A failure on the part of the settlor definitely to
As to Applicability of Doctrine of Laches describe the subject-matter of the supposed trust or
the beneficiaries or object thereof is strong evidence
An express repudiation In constructive trusts, that he intended no trust. The intent to create a
made known to the even if there is no trust must be definite and particular. It must show
beneficiary is necessary repudiation, laches may a desire to pass benefits through the medium of a
in order that laches or bar an action to enforce trust, and not through some related or similar device
acquisitive prescription an implied trust (Mindanao Development Authority v. Court of
may bar an action to Appeals, G.R. No. L-49087, April 5, 1982).
enforce an express EXCEPTION: If there is
trust. (DE LEON supra concealment (DE LEON
at 669). supra at 669-671).
COMMON TYPES OF EXPRESS
TRUSTS: (P2EAS2D)
OTHER CLASSIFICATIONS OF TRUST 1. Publicly-Regulated Trust
1. As to Effectivity – One where the State provides the vehicle by
– From the viewpoint of whether they become which institutions are allowed to administer large
effective after the death of the trustor or during funds for the benefit of the public. Among such
his life, it may be either: funds created under the law would be pension
and benefits funds administered by GSIS, SSS,
a. Testamentary trust – one which is to take and Pag-Ibig Fund (VILLANUEVA, Agency &
effect upon the trustor’s death. Trusts, Partnerships & Joint Ventures, supra at
b. Trust inter vivos (sometimes called “living 288);
trusts”) – one established effective during
the owner’s life.
2. Private Trust
– Not for the good of the public in general or
society as a whole;
3. Eleemosynary/Charitable Trust
– Designed for the benefit of a segment of the
public or the public in general;
4. Accumulation Trust
– One that will accumulate income to be
reinvested by the trustee in the trust for the
period of time specified;
5. Spendthrift Trust
– Income will be paid to the prodigal-beneficiary
only when necessary; and
6. Sprinkling Trust
– Gives the trustee the right to determine the
income of beneficiaries who should receive
income each year and the amount thereof;
7. Discretionary Trust
– Gives the trustee discretion to pay or not to pay
the income or principal (DE LEON, Partnership,
Agency & Trusts, supra at 657).
CREATION OF EXPRESS TRUST
Express trusts are intentionally created by direct and
positive acts of the trustor – by some writing, deed,
will, or oral declaration evincing an intention to
create the trust.
The creation of an express trust must be manifested
with reasonable certainty and cannot be assumed
from loose and vague declarations or circumstances
capable of other interpretations (Philippine National
Bank v. Aznar, G.R. No. 171805, May 30, 2011).
PERFECTION OF EXPRESS TRUST
Express trust is perfected at the moment that there
existed a separation of title and equitable interest
over the trust property.
FORM OF EXPRESS TRUST
GENERAL RULE: No particular words are required
for the creation of an express trust, it being sufficient
that a trust is clearly intended (NEW CIVIL CODE,
Art. 1444).
The mere fact that the word “trust” or “trustee” is
employed does not necessarily indicate or prove an
intention to create a trust (DE LEON, Partnership,
Agency & Trusts, supra at 655).
The question in each case is whether the trustor
manifested an intention to create the kind of
relationship which to lawyers is known as trust. It is
immaterial whether or not he knows that the
relationship which he intends to create is called a
trust, and whether or not he knows the precise
characteristics of the relationship which is called a
trust (Go v. Estate of de Buenaventura, G.R. No.
211972, July 22, 2015).
EXCEPTION: No express trust concerning an
immovable or any interest therein may be proved by
parol evidence (NEW CIVIL CODE, Art. 1443).
NOTE: The burden of proving the existence of the
trust is on the party alleging its existence by clear,
satisfactory and convincing proof (Ramos v. Ramos,
G.R. No. L-19872, December 3, 1974).
FORMALITIES OF EXPRESS TRUST A
MATTER OF ENFORCEABILITY
1. The requirement that the express trust over an
immovable be written is only for enforceability,
not for validity between the parties. Hence,
Article 1443 may by analogy be included under
the Statute of Frauds.
2. By implication, for a trust over personal property
an oral agreement is valid and enforceable
between the parties.
3. Regarding third persons, the trust must be in a
public instrument and registered in the Registry
of Property if it concerns real property (4
PARAS, supra at 892)
WHEN TRUSTEE DECLINES
DESIGNATION
GENERAL RULE: No trust shall fail because the
trustee appointed declines the designation.
EXCEPTION: Unless the contrary should appear in
the instrument constituting the trust (CIVIL CODE,
Art. 1445).
One designated or appointed as trustee may decline
the responsibility and thereby be free from any legal
or equitable duty or liability in the matter. Unless the
contrary intention appears in the instrument
constituting the trust, declination or refusal or
disqualification of a trustee does not operate to
defeat or void the trust; nor does it operate to vest
legal title as well as equitable title in the beneficiary
(DE LEON, Partnership, Agency & Trusts, supra at
659-660).
Where a trustee under a written instrument declines,
resigns, dies, or is removed before the objects of the
trust are accomplished, and no adequate provision
is made in such instrument for supplying the
vacancy, the proper Court of First Instance may,
after due notice to all persons interested, appoint a
new trustee to act alone or jointly with the others, as
the case may be (see RULES OF COURT, Rule 98,
Sec.3).
NOTE: There are cases in which it may appear that
the trustor intended the trust to continue only so long
as the person designated by him as trustee should
continue as such. It may be so provided by the terms
of the trust, or it may appear that the purposes of the
trust cannot be carried out unless the person named
as trustee continues to act. In such a case, the trust
will fail, if the trustee resigns, dies, is removed or
otherwise ceased to be a trustee (VILLANUEVA,
Agency & Trusts, Partnerships & Joint Ventures,
supra at 292).
TRUSTEE MUST FILE A BOND
Before entering on his duties, a trustee shall file with
the clerk of the court a bond payable to the
Government of the Philippines, sufficient and
available for the protection of any party in interest. A
trustee who neglects to file such bond shall be
considered to have declined or resigned the trust;
but the court may exempt a trustee under a will from
giving a bond when the testator has directed or
requested such exemption and may so exempt any
trustee when all persons beneficially interested in
the trust request the exemption. Such exemption
may be cancelled by the court at any time and the
trustee required to forthwith file a bond (see RULES
OF COURT, Rule 98, Sec.5).
CONDITIONS INCLUDED IN BOND
WHETHER WRITTEN THEREIN OR NOT
1. That the trustee will make and return to the
court, at such time as it may order, a true
inventory of all the real and personal estate
belonging to him as trustee, which at the time of
the making of such inventory shall have come
to his possession or knowledge;
2. That he will manage and dispose of all such
estate, and faithfully discharge his trust in
relation thereto, according to law and the will of
the testator or the provisions of the instrument
or order under which he is appointed;
3. That he will render upon oath at least once a
year until his trust is fulfilled, unless he is
excused therefrom in any year by the court, a
true account of the property in his hands and
the management and disposition thereof, and
will render such other accounts as the court
may order;
4. That at the expiration of his trust he will settle
his account in court and pay over and deliver all
the estate remaining in his hands, or due from
him on such settlement, to the person or
persons entitled to thereto.
NOTE: But when the trustee is appointed as a
successor to a prior trustee, the court may dispense
with the making and return of an inventory, if one has
already been filed, and in such case the condition of
the bond shall be deemed to be altered accordingly
(see RULES OF COURT, Rule 98, Sec.6).
APPRAISAL
When an inventory is required to be returned by a
trustee, the estate and effects belonging to the trust
shall be appraised and the court may order one or
more inheritance tax appraisers to assist in the
appraisement (see RULES OF COURT, Rule 98,
Sec.7).
COMPENSATION OF TRUSTEE
The compensation of the trustee shall be fixed by the
court, if it be not determined in the instrument
creating the trust (see RULES OF COURT, Rule 98,
Sec.7).
REMOVAL OR RESIGNATION OF
TRUSTEE
The proper Regional Trial Court may, upon petition
of the parties beneficially interested and after due
notice to the trustee and hearing, remove a trustee if
such removal appears essential in the interest of the
petitioner. The court may also, after due notice to all
persons interested, remove a trustee who is insane
or otherwise incapable of discharging his trust or
evidently unsuitable therefor. A trustee, whether
appointed by the court or under a written instrument,
may resign his trust if it appears to the court proper
to allow such resignation (see RULES OF COURT,
Rule 98, Sec.8).
ACCEPTANCE OF BENEFICIARY
NECESSARY
Acceptance by the beneficiary is necessary (NEW
CIVIL CODE, Art. 1446).
However, if the trust imposes no onerous condition
upon the beneficiary, his acceptance shall be
disputably presumed, if there is no proof to the
contrary (NEW CIVIL CODE, Art. 1446).
Form of Acceptance of Beneficiary
Even if real property is involved, acceptance by the
beneficiary need not be in a public instrument
(Cristobal v. Gomez, G.R. No. L-27014, October 5,
1927).
NOTE: Acceptance by the beneficiary of a gratuitous
trust is not subject to the rules for the formalities of
donations (4 PARAS, supra at 898).
Effect of Non-Acceptance of Beneficiary After
Legal Title has been transferred to Trustee
Author Cesar Villanueva opines as follows: “The
essential characteristic of express trust being a
preparatory contract would mean that with the
purpose of the trust no longer availing, since the
designated beneficiary has refused the trust (Filipinas Port Services Inc. v. Go, G.R. No. 161886,
relationship, the trust ceases to have an objective. March 16, 2007).
But since the naked or legal title remains with the
trustee, his obligations are to comply with the An implied trust is neither dependent upon an
instructions of the trustor, and to dispose of the trust express agreement nor required to be evidenced in
properties in accordance with the instructions of the writing, Article 1457 of our Civil Code authorizes the
trustor, which may include the designation of a new admission of parol evidence to prove their existence.
beneficiary (VILLANUEVA, Agency & Trusts, Parol evidence that is required to establish the
Partnerships & Joint Ventures, supra at 266). existence of an implied trust necessarily has to be
trustworthy and it cannot rest on loose, equivocal or
EXTINGUISHMENT OF EXPRESS indefinite declarations (Jose Juan Tong et al. v. Go
2
TRUST: (THE-MAD -BRAM) Tiat Kun et al., G.R. No. 196023, April 21, 2014).
1. Total loss of the object of the trust;
2. Happening of the resolutory condition, if one had RESULTING TRUST V. CONSTRUCTIVE
been imposed; TRUST
3. Expiration of the agreed term; RESULTING TRUST CONSTRUCTIVE
4. Mutual agreement of all parties; TRUST
5. Annulment or rescission of the trust;
6. Decision of court declaring the trust terminated; As to the Intention to Create Trust
7. Death or legal incapacity of the trustee when the
trustor intended no other person to administer The intent of the parties The trust is created
the trust (Cañezo v. Rojas, G.R. No. 148788, to create a trust is irrespective of or even
November 23, 2007); presumed or implied by contrary to the intention
8. Breach of trust; law from the nature of of the parties to promote
9. Revocation by the trustor when such power is their transaction. justice, frustrate fraud
reserved (VILLANUEVA, Agency & Trusts, and to prevent unjust
Partnerships & Joint Ventures, supra at 302); enrichment.
10. Accomplishment of the purpose of trust; and
11. Merger of the rights of the trustor and the As to Prescriptive Period
trustee, as when the trustor waived his beneficial The 10-year The 10-year
rights in favor of the trustee, or vice versa (4 prescriptive period shall prescriptive period shall
PARAS, supra at 899). be counted from the be counted from the
time repudiation is time the trustor or
made known to the beneficiary is charged
trustor or beneficiary. with constructive
IMPLIED TRUSTS knowledge of the
ARTS. 1447-1457 constructive trust.
(DE LEON, Partnership, Agency & Trusts, supra at
661-662).

IMPLIED TRUST IMPLIED TRUST RECOGNIZED BY THE

Those which, without being express, are deducible
from the nature of the transaction as matters of
intent, or which are superinduced on the transaction
by operation of law, as matters of equity
independently of the particular intention of the
parties (Philippine National Bank v. CA, G.R. No.
97995, January 21, 1993).
PROOF OF IMPLIED TRUSTS
While implied trusts may be proved by oral evidence,
the evidence must be trustworthy and received by
the courts with extreme caution, and should not be
made to rest on loose, equivocal or indefinite
declarations. The proof should be as fully
convincing as if the acts giving rise to the trust
obligation are proven by an authentic document
CIVIL CODE
Resulting trusts
1. Purchase money resulting trust (NEW CIVIL
CODE, Art. 1448);
2. Donations made to a person but the beneficial
interest is vested in another. The donee is the
trustee while the designated third person is the
beneficiary (NEW CIVIL CODE, Art. 1449);
3. Legal title to land inherited by heir placed in the
name of another (NEW CIVIL CODE, Art. 1451);
4. Legal title to property purchased taken in one co-
owner (NEW CIVIL CODE, Art. 1452); or
5. Conveyance under a promise to hold for, or
transfer to another (NEW CIVIL CODE, Art.
1453).
Constructive trusts
1. Purchase with borrowed funds and the
conveyance is made to lender to secure
payment of debt (NEW CIVIL CODE, Art. 1450);
2. Absolute conveyance to a person to secure
performance of grantor’s obligation (NEW CIVIL
CODE, Art. 1454);
3. Purchase of property with use of trust funds and
causes the conveyance to be made to the
trustee or to a third person (NEW CIVIL CODE,
Art. 1455);
4. Property acquired through mistake or fraud
(NEW CIVIL CODE, Art. 1456).
Enumeration not Exclusive
The enumeration of cases of implied trusts does not
exclude others established by the general law of
trust but the limitation laid down in Art. 1442 is
applicable (NEW CIVIL CODE, Art. 1447).
An implied trust arising from mortgage contracts is
not among the trust relationships the Civil Code
enumerates. However, the Code itself provides that
such listing "does not exclude others established by
the general law on trust.” Under the general
principles on trust, equity converts the holder of
property right as trustee for the benefit of another if
the circumstances of its acquisition makes the holder
ineligible "in good conscience to hold and enjoy it."
(Juan v. Yap, Sr., G.R. No. 182177, March 30,
2011).
The Court has recognized unconventional implied
trusts in contracts involving the purchase of housing
units by officers of tenants’ associations in breach of
their obligations, the partitioning of realty contrary to
the terms of a compromise agreement, and the
execution of a sales contract indicating a buyer
distinct from the provider of the purchase money. In
all these cases, the formal holders of title were
deemed trustees obliged to transfer title to the
beneficiaries in whose favor the trusts were deemed
created. Thus, there is no reason to bar the
recognition of the same obligation in a mortgage
contract meeting the standards for the creation of an
implied trust. (Juan v. Yap, Sr., G.R. No. 182177,
March 30, 2011).
IMPLIED RESULTING TRUSTS
The principle of a resulting trust is based on the
equitable doctrine that valuable consideration and
not legal title determines the equitable title or interest
and are presumed always to have been
contemplated by the parties (Jose Juan Tong et al.
v. Go Tiat Kun et al., G.R. No. 196023, April 21,
2014).
Trustee as merely a depositary of legal title
FACTS: Unknown to the other children of Margarita,
the mother transferred the tax declarations of her
three (3) lands to her son, Roberto, to support his
application for travel to the US.
As a trustee of a resulting trust, therefore, Roberto,
like the trustee of an express passive trust, is merely
a depositary of legal title having no duties as to the
management, control or disposition of the property
except to make a conveyance when called upon by
the cestui que trust (Estate of Cabacungan v. Laigo,
G.R. No. 175073, August 15, 2011).
Conversion of Resulting Trust to Express Trust
An implied trust can be converted into an express
trust if the implied trustee recognized the right of the
owner over the property (PINEDA, Partnership,
Agency & Trusts (2006) p.446 [hereinafter PINEDA,
Partnership, Agency & Trusts]).
A trust may have a constructive or implied nature in
the beginning, but the registered owner’s
subsequent express acknowledgement in a public
document of a previous sale of the property to
another party effectively converted the same into an
express trust (Tamayo v. Callejo, G.R. No. L-25563,
July 28, 1972).
1. Purchase Money Resulting Trust;
When property is sold, and the legal estate is
granted to one party but the price is paid by
another party for the purpose of having the
beneficial interest of the property (NEW CIVIL
CODE, Art. 1448).
GENERAL RULE: Purchase money resulting
trust occurs when there is:
a. An actual payment of money, property or
services or an equivalent, constituting
valuable consideration; and
b. Such consideration must be furnished by the
alleged beneficiary of a resulting trust
(Gabutan v. Nacalaban, G.R. Nos. 185857-
58 & 194314-15, June 29, 2016).
EXCEPTIONS:
a. If the person to whom the title is conveyed is
a child, legitimate or illegitimate, of the one
paying the price of the sale, it is disputably
presumed that there is a gift in favor of the
child; (NEW CIVIL CODE, Art. 1448);
b. Where an actual contrary intention is
proved;
c. Where the purchase is made in violation of
an existing statute and in evasion of its
express provision, no trust can result in
favor of the party who is guilty of fraud
(Morales v. Court of Appeals, G.R. No.
117228, July 19, 1997).
 No Implied Trust is Created when Purchase
is Made in Violation of Law
Where the purchase is made in violation of an
existing statute and in evasion of its express
provision, no trust can result in favor of the
party who is guilty of the fraud (Banco Filipino
and Savings and Mortgage Bank vs. Tala
Realty Services Corporation et.al., G.R. No.
181933, September 9, 2013).
2. Donation to a Person but Beneficial
Interest Vested in Another;
A trust results in favor of the person in whom it
is intended to vest the beneficial interest in the
property donated, with the done being the
trustee (DE LEON, Partnership, Agency &
Trusts, supra at 688).
3. Legal Title to Land Inherited by Heir
Placed in the Name of Another;
Where a person who has acquired land by
inheritance causes the legal title to be placed in
the name of another, a resulting trust is
presumed by law in favor of the true owner, the
heir (DE LEON, Partnership, Agency & Trusts,
supra at 690).
4. Legal Title to Property Purchased Taken
in One Co-owner; and
For Article 1452 to apply, all that a co-owner
needs to show is that there is “common consent”
among the purchasing co-owners to put the
legal title to the purchased property in the name
of the co-owner for the benefit of all. The
property must be capable of private ownership;
otherwise Article 1452 is not applicable (DE
LEON, Partnership, Agency & Trusts, supra at
691).
5. Conveyance Under a Promise to Hold
For, or Transfer to Another
Article 1453 is based on the promise or
representation of the grantee to hold the
property conveyed for, or transfer it to another or
the grantor. The grantee is estopped from
asserting ownership in himself by denying his
representation as against the person for whose
benefit the implied trust is created (Id. at 693).
CONSTRUCTIVE TRUSTS
NOTE: A constructive trust does not emanate from
or generate a fiduciary relation. Constructive trusts
are created by the construction of equity in order to
satisfy the demands of justice and prevent unjust
enrichment (Jose Juan Tong et al. v. Go Tiat Kun et
al., G.R. No. 196023, April 21, 2014).
1. Purchase with Borrowed Money;
If the price of a sale of property is loaned or paid
by one person for the benefit of another and the
conveyance is made to the lender or payor to
secure the payment of the debt, a trust arises by
operation of law in favor of the person to whom
the money is loaned or for whom it is paid. The
latter may redeem the property and compel a
conveyance thereof to him. (NEW CIVIL CODE,
Art. 1450).
NOTE: An agreement between the parties
whereby the property purchased shall be
considered sold to the trustee in case the
beneficiary fails to reimburse him is tantamount
to pactum commissorium (DE LEON,
Partnership, Agency & Trusts, supra at 689).
2. Absolute Conveyance of Property is
Made in order to Secure Performance of
Grantor’s Obligation;
If an absolute conveyance of property is made
instead in order to guarantee the performance of
an obligation of the grantor toward the grantee,
an implied trust is created by operation of law for
the benefit of the grantor (DE LEON,
Partnership, Agency & Trusts, supra at 694).
3. Purchase of Property with the Use of
Trust Funds and Causes the
Conveyance to be Made to the Trustee or
Third Person; and
The rule stands on the moral obligation to refrain
from placing one’s self in position which
ordinarily excite conflicts between self-interest
and integrity.
The rule in Article 1455 is entirely independent
of whether any fraud has intervened. No fraud,
in fact need be shown, and no excuse will be
heard from the trustee (Id. at 695).
4. Acquisition of Property through Mistake
or Fraud
Where a party acquires through mistake or fraud
a legal title to the property to which another has
a better right, there is created by law what is
termed in jurisprudence as constructive trust in
favor of the aggrieved party who is truly entitled
to it or his successors-in –interest, and grants to
the latter the right to recover his or their over the
property by way of reconveyance while the
same has not yet passed to an innocent
purchaser for value in keeping with the primary
principle of law and equity that one should not
unjustly enrich himself at the expense of another
(Id. at 696).
DISTINCTION FROM RESULTING
TRUSTS
1. Resulting trusts are essentially
contractual
a. The cases contemplated from Articles 1448
to 1454 all involve an implied intention by
the trustor to establish a trust in his own
favor or in favor of a third person.
b. The intentionality of the conveyance of
property in favor of another instead of the
equitable owner makes its contractual
nevertheless.
c. The right of the trustor or beneficiary to the
return and reconveyance of the trust
property is founded on the obligation to
restitute in case of rescission or annulment
of contract following its breach (See NEW
CIVIL CODE, Arts. 1385 and 1398).
d. The trustee has legal title to the trust
property and has no obligation to return
unless his ownership has become unlawful
or contrary to the objective of the trust.
2. Constructive Trusts are based on equity
a. Constructive Trusts as defined under Article
1456 however contemplates situation where
the conveyance of a property is by mistake
or fraud therefore lacking in an intent to
establish a trust.
b. The trust is purely a matter of equity and is
created even without any intention on the
part of the implied trustor.
c. As the basis of the trustee’s obligation is
mistake or fraud, a quasi-contract is created
instead.
d. The obligation of the trustee to reconvey the
property wrongfully conveyed to him is
based on the principle against unjust
enrichment (NEW CIVIL CODE, Art. 22;
Laureano v. Stevenson, G.R. No. 20783,
October 16, 1923).
No Fiduciary Relation Exists
A court of equity does not consider a constructive
trustee for all purposes as though he were in reality
a trustee; although it will force him to return the
property, it will not impose upon him the numerous
fiduciary obligations ordinarily demanded from a
trustee of an express trust. It must be borne in mind
that in an express trust, the trustee has active duties
of management while in a constructive trust, the duty
is merely to surrender the property (PNB v. CA &
B.P. Mata, G.R. No. 97995, January 21, 1993).
NOTES:
1. In constructive trusts, there is neither a promise
nor any fiduciary relation to speak of (Estate of
Cabacungan v. Laigo, G.R. No. 175073, August
15, 2011).
2. The so-called trustee neither accepts any trust
nor intends holding the property for the
beneficiary (Estate of Cabacungan v. Laigo,
G.R. No. 175073, August 15, 2011).
3. The implied trustee shall deliver the possession
and reconvey title to the property to the
beneficiary of the trust, and to pay to the latter
the fruits and other net profit received from such
property during the period of wrongful or
unconscionable holding, and otherwise to adjust
the equities between the trustee holding the
legal title and the beneficiaries of the trust
(Sumaoang v. Judge, RTC, G.R. No. 78173,
October 26, 1992).
INNOCENT PURCHASER FOR VALUE
The right of action in this constructive trust should
be exercised against the trustee, who caused the
fraud, and not against an innocent purchaser for
value, as the Susana Realty, Inc. This right may
also be exercised against Santiago Cruz who also
obtained title to the land with knowledge of the
fraud, but not with regard to Susana Realty, Inc.
which, as already stated, has bought the property in
good faith. The remedy in this case of the defrauded
heirs is to bring an action for damages against those
who caused the fraud or were instrumental in
depriving them of the property. Their action cannot
reach an innocent purchaser for value who is
protected by law (Avecilla v. Yatco, G.R. No. L-
11578, May 14, 1958).
ACTIONS BASED ON TRUSTS
REPUDIATION OF EXPRESS OR
RESULTING TRUST
A trustee (express trust or implied trust) cannot
acquire by prescription ownership over property
entrusted to him until and unless he repudiates the
trust (Vda. De Esconde v. Court of Appeals, G.R.
No. 103635, February 1, 1996).
The repudiation constitutes a breach of contract
which gives the trustor and/or the beneficiary a
cause of action (NEW CIVIL CODE, Art. 1170).
REQUISITES FOR VALID REPUDIATION:
(UPE)
1. The trustee has performed Unequivocal acts of
repudiation amounting to an ouster of the cestui
que trust;
2. Such Positive acts of repudiation have been
made known to the cestui que trust; and
3. Evidence thereon is clear and positive (Vda. de
Cabrera v. Court of Appeals, G.R. No. 108547,
February 3, 1997).
Repudiation Not Necessary in Constructive
Trusts
In constructive trusts, the legal title of the
constructive trustee is acquired by fraud or mistake
and is therefore adverse from the beginning. It is not
necessary for the constructive trustee to repudiate
the trust.
Trustee Cannot Repudiate Trust by Relying on
Registration of property In His Own Name
A certificate of title under the Torrens System is
aimed to protect dominion, and should certainly be
not turned into an instrument for deprivation of
ownership (Adriano v. CA, G.R. No. 124118, March
27, 2000).
NOTE: The principle that a trustee who puts a
certificate of registration in his name cannot
repudiate the trust by relying on the registration is
one of the well-known limitations upon a title. (Jose
Juan Tong et al. v. Go Tiat Kun et al., G.R. No.
196023, April 21, 2014).
NOTE: Registration of a registered land by an
innocent purchaser for value shall be respected as a
matter of public policy to protect the integrity of the
Torrens System (Avecilla v.Yatco, G.R. No. L11578,
May 14, 1958).
PRESCRIPTION OF ACTIONS TO
ENFORCE EXPRESS OR RESULTING
TRUSTS
1. Express Trusts Over Immovables
Express trusts over immovables must be written
(NEW CIVIL CODE, Art. 1443).
An action to enforce a written contract
prescribes within 10 years from the time the
cause of action accrues (NEW CIVIL CODE, Art.
1144, par. 1).
2. Express Trusts Over Personalty
a. If the trust is written: 10 years from accrual
of cause of action (NEW CIVIL CODE, Art.
1144, par. 1).
b. If the trust is oral: 6 years from accrual of
cause of action (NEW CIVIL CODE, Art.
1145, par. 1).
3. Resulting Trusts
The obligations of the implied trustee are
created by law (NEW CIVIL CODE, Art. 1441). It
follows that actions to enforce obligations
created under an implied trust prescribes within
10 years from the accrual of cause of action
(NEW CIVIL CODE, Art. 1144, par. 2).
When Cause of Action Over an Express or
Resulting Trust Accrues
The cause of action accrues from the time when the
trustee’s repudiation of the trust is communicated
and made known to the trustor or beneficiary
(Salinas v. Tuason, G.R. No. L-33626, March 2,
1931).
Prescription of Actions for Conveyance Based
on Constructive Trust
The obligation of the constructive trustee is created
by law (NEW CIVIL CODE, Art. 22). It follows that
actions to enforce obligations created under a
constructive trust prescribes within 10 years from the
accrual of cause of action (NEW CIVIL CODE, Art.
1144, par. 2).
NOTE: If the owner however is in possession of the
property wrongfully conveyed by fraud or mistake,
then the action to reconvey legal title acquired under
a constructive trust partakes in the nature of quieting
of title. In such cases, the action does not prescribe
(Heirs of Narvasa Sr. v. Imbornal, G.R. No. 182908,
August 6, 2014).
The 4-year prescriptive period under Art. 1391
applies only if the fraud does not give rise to an
implied trust, and the action is to annul avoidable
contract under Art. 1390 (Bejoc v. Cabreros, G.R.
145849, July 22, 2005).
When Cause of Action Over a Constructive Trust
Accrues
The right to seek reconveyance on an implied or
constructive trust is not absolute. It is subject to
extinctive prescription. An action for reconveyance
based on implied or constructive trust prescribes in
10 years. This period is reckoned from the date of
the issuance of the original certificate of tile or
transfer certificate of title. Since such issuances
operates as a constructive notice to the whole world
(Bejoc v. Cabreros, G.R. 145849, July 22, 2005).
In constructive trusts (that are imposed by law),
there is neither promise nor fiduciary relation; the so-
called trustee does not recognize any trust and has
no intent to hold for the beneficiary; therefore, the
latter is not justified in delaying action to recover his
property. It is his fault if he delays; hence, he may be
estopped by his own laches (Diaz v. Gorricho, G.R.
No. L-11229, March 29, 1958).
RULES ON PRESCRIPTION OF ACTION GROUND PRESCRIPTIVE PERIOD
FOR RECONVEYANCE BASED ON
IMPLIED TRUST wait until his possession is
The following are the rules on prescription and disturbed or his title is
laches in an action to recover the property held in attacked before taking steps
trust: to vindicate his right. His
undisturbed possession gives
him a continuing right to seek
GROUND PRESCRIPTIVE PERIOD the aid of a court of equity to
ascertain and determine the
If the action for The period of prescription is nature of the adverse claim of
reconveyance four (4) years from the a third party and its effect on
involves the discovery of fraud. his own title, which right can
annulment of a be claimed only by one who is
voidable contract REASON: The action for in possession (Gabutan v.
(Article 1390) annulment of voidable Nacalaban, G.R. Nos.
which became the contract shall be brought 185857-58 & 194314-15,
basis for within four years (CIVIL June 29, 2016).
fraudulent CODE, Art. 1391).
registration of the
subject property
TRUST PURSUIT RULE
Equity will pursue property that is wrongfully
If the action does The period of prescription is converted by the fiduciary, or otherwise compel
not involve an ten (10) years from the time restitution to the beneficiary. A trust will follow the
annulment of a the cause of action accrues. property through all changes in its state and form
contract, but there even into the hands of a transferee other than a
was fraud in the REASON: An action based bona fide purchaser for value, or restitution will be
registration of the upon an obligation by law enforced at the election of the beneficiary through
subject property must be brought within ten recourse against the trustee or the transferee
(10) years from the time the personally. (Estate of Margarita Cabacungan v.
right of action accrues (CIVIL Marilou Laigo, G.R. No. 175073, August 15, 2011).
CODE, Article 1144(2)).

If the action The action is imprescriptible.

involves the
declaration of the REASON: The action or
nullity or defense for the declaration of
inexistence of a the inexistence of a contract
void or inexistent does not prescribe (CIVIL
contract which CODE, Art. 1410).
became the basis
of fraudulent
registration of the
subject property

If the plaintiff or The action is imprescriptible.

the person In effect, the action for
enforcing the trust reconveyance is an action to
is in actual quiet the property title, which
possession of the does not prescribe.
property
Reason: The one who is in
actual possession of the land
claiming to be its owner may
 The absence of any of the essential elements
SALE shall negate the existence of a perfected
contract of sale (Dantis v. Maghinang Jr., G.R.
(ARTS. 1458-1637) No. 191696, April 10, 2013).

2. Natural
– Those elements which are deemed to exist in
CONTRACT OF SALE certain contracts in the absence of any contrary
By the contract of sale, one of the contracting parties stipulations (DE LEON, supra at 12).
obligates himself to transfer the ownership of and to
deliver a determinate thing, and the other to pay Examples: Warranty against eviction (CIVIL
therefor a price certain in money or its equivalent CODE, Art. 1548) and warranty against hidden
(CIVIL CODE, Art. 1458). defects (CIVIL CODE, Art. 1561).

ELEMENTS OF A CONTRACT OF SALE: 3. Accidental

1. Essential
– Those elements, without which, there can be
no valid sale.
a. Consent / Meeting of the Minds – refers to
the consent on the part of the seller or
vendor to transfer and deliver, and on the
part of the buyer or vendee to pay (CIVIL
CODE, Art. 1475).
NOTE: There may be a sale against the will
of the owner in case of expropriation of
property for public use, which is governed by
special laws (CIVIL CODE, Art. 1488).
b. Object / Subject – refers to the determinate
thing which is the object of a contract (CIVIL
CODE, Art. 1460).
c. Cause / Consideration – refers to a price
certain in money or its equivalent (CIVIL
CODE, Art. 1458). It is presumed that a
contract has sufficient consideration (DE
LEON & DE LEON JR., Comments and
Cases on Sales and Lease, (2014), p.12
[hereinafter, DE LEON]). It includes the
manner of payment.
– Those elements which may be present or
absent depending on the stipulations of the
parties (e.g., conditions, interest, penalty, time
or place of payment) (DE LEON, supra at 12).
PHASES OR STAGES OF CONTRACT
OF SALE
1. Preparation
– The period of negotiation and bargaining,
ending at the moment of agreement of the
parties.
Policitation is an unaccepted unilateral promise
to buy or sell, prior to acceptance, and does not
give rise to any obligation or right. This produces
no juridical effect and creates no legal bond.
This is a mere offer and has not yet been
converted into a contract except at the moment
it is accepted (Diamante v. CA, G.R. No. L-
51824, February 7, 1992).
2. Perfection
– Birth of contract; a contract of sale is perfected
upon the meeting of the minds of the parties:
a. To enter into a contract of sale, i.e.,
acceptance of offer;
b. Upon the thing which is the object of the
contract; and

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA R. TAMPUS, Vice
Chairperson for Secretariat | ARVY KEITH N. CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice
Chairperson for Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. THERESA GENEVIEVE NUEVE-CO and Atty. LUIS MANUEL BUGAYONG

c. On the consideration or price certain in
money or its equivalent (CIVIL CODE, Art.
1475, par. 1).
From that moment, the parties may reciprocally
demand performance, subject to the provisions
of the law governing the form of contracts (CIVIL
CODE, Art. 1475, par. 2).
EXCEPTION: When the sale is subject to a
suspensive condition, because perfection takes
place from the moment the condition is fulfilled
(Reyes v. Tuparan, G.R. No. 188064, June 1,
2011).
NOTE: Actual delivery of the subject matter or
payment of the price agreed upon are not
necessary components to establish the
existence of a valid contract of sale. Neither is
the delivery of the thing bought nor the payment
of the price necessary for the perfection of the
contract of sale (DE LEON, supra at 16); their
non-performance do not also invalidate, or
render void a sale that has begun to exist as a
valid contract at perfection (VILLANUEVA,
supra at 8). The non-performance merely
becomes the legal basis for remedies of either
specific performance or rescission, with
damages in either case (Gabelo v. CA, G.R. No.
111743, October 8, 1999).
Consent
It is manifested by the concurrence of the offer
and the acceptance upon the thing and the
cause, which are to constitute the contract
(CIVIL CODE, Art. 1319, par. 1).
Elements of Consent: (SC3)
a. Subjects / contracting parties (CIVIL CODE,
Art. 1318);
b. Concurrence of offer and acceptance (CIVIL
CODE, Arts. 1319-1326);
c. Legal Capacity of the contracting parties
(CIVIL CODE, Arts. 1327-1329); and
d. The Consent must be given intelligently,
freely, and spontaneously (CIVIL CODE,
Arts. 1330-1336).
NOTE: The contract to sell is a bilateral contract.
Where there is merely an offer by one party
without the acceptance of the other, there is no
consent. (Salonga v. Farrales, G.R. No. L-
47088, July 10, 1981).
Form of Offer
It must be certain, definite, and intentional
(CIVIL CODE, Art. 1319, par. 1).
Business Advertisements of Things for Sale
Unless it appears otherwise, they are not
definite offers but mere invitations to make an
offer (CIVIL CODE, Art. 1325).
Advertisements for Bidders
They are simply invitations to make proposals
and the advertiser is not bound to accept the
highest or lowest bidders, unless the contrary
appears (CIVIL CODE, Art. 1326).
An offer becomes ineffective upon the death,
civil interdiction, insanity, or insolvency of either
party before acceptance is conveyed (CIVIL
CODE Art. 1323).
Form of Acceptance
It must be absolute. A qualified acceptance
constitutes a counter-offer (CIVIL CODE, Art.
1319, par. 1). An acceptance may be express or
implied (CIVIL CODE, Art. 1320).
Acceptance by a letter or telegram
It does not bind the offeror except from the time
it came to his knowledge. Therefore, even if an
acceptance has been mailed or sent to the
offeror, the offeror may still withdraw his offer
any time before he has knowledge of the
acceptance (CIVIL CODE, Art. 1319, par. 2).
The person making the offer may fix the time,
place, and manner of acceptance, all of which
must be complied with (CIVIL CODE, Art. 1321).
An offer made through an agent is accepted
from the time acceptance is communicated to
him (CIVIL CODE, Art. 1322).
3. Consummation
– Death of contract; delivery/ actual transfer of
ownership of the thing together with the payment
of the price marks the consummation of the
contract of sale (Robern Development Corp. v.
People’s Landless Associated, G.R. No.
173622, March 11, 2013).
CHARACTERISTICS: (PNB-TOC2)
1. Principal
– It can stand on its own and does not depend
on another contract for its validity or existence
(VILLANUEVA, supra at 5);
2. Nominate
– It has been given a particular name by law
(CIVIL CODE, Art. 1458);
3. Bilateral
– It imposes an obligation on both parties
(VILLANUEVA, supra at 5);
a. Obligation of seller–to transfer ownership
 of and deliver a determinate thing; and
b. Obligation of buyer–to pay a price certain
in money or its equivalent.
4. Title
– Sale is merely a title that creates the obligation
on the part of the seller to transfer ownership
and deliver possession, but on its own, it is not
a mode that transfers ownership. (San Lorenzo
Development Corporation v. CA, G.R. No.
124242, January 21, 2005);
5. Onerous
– It imposes a valuable consideration, which is a
price certain in money or its equivalent (CIVIL
CODE, Art. 1458);
Consequence: All doubts in construing an
onerous contract shall be resolved in greater
reciprocity of interests (CIVIL CODE, Art. 1378).
6. Commutative
– Wherein a thing of value is exchanged for
equal value, i.e., the value of the subject matter
is equivalent to the price paid (VILLANUEVA,
supra at 11); and
7. Consensual
– It is perfected by mere consent (CIVIL CODE,
Art. 1475).
TWO MAJOR TYPES OF A CONTRACT
OF SALE:
1. Absolute Sale
– No conditions attached; transfer of ownership
is vested upon delivery (CIVIL CODE, Art.
1497); and
2. Conditional Sale
– Contemplates a contingency (CIVIL CODE,
Arts. 1461, 1462, par.2, and 1465) and subject
to certain conditions (CIVIL CODE, Art. 1503,
par. 1); ownership will not automatically transfer
to the buyer although the property may have
been previously delivered to him (Coronel v. CA,
G.R. No. 103577, October 7, 1996).
CONTRACTS OF SALE DISTINGUISHED
FROM OTHER KINDS OF CONTRACTS
A contract is what the law defines it to be, taking into
consideration its essential elements, and not what it
is called by the contracting parties (ACE Foods, Inc.
v. Micro Pacific Technologies Co., Ltd., G.R.
200602, December 11, 2013).
CONTRACT OF AGENCY
By the contract of agency a person binds himself to
render some service or to do something in
representation or on behalf of another, with the
consent or authority of the latter (CIVIL CODE, Art.
1868).
The transfer of title or agreement to transfer for a
price paid is the essence of sale. If such transfer puts
the transferee in the position of an owner and makes
him liable for the agreed price, the transaction is a
sale. On the other hand, the essence of an agency
to sell is the delivery to an agent, not as his property,
but as the property of his principal, who remains the
owner and has the right to control sales, fix the price
and terms, demand and receive the proceeds less
the agent's commission upon the sales made (Sps.
Viloria v. Continental Airlines, Inc., G.R. No. 188288,
January 16, 2012).
SALE AND AGENCY TO SELL,
DISTINGUISHED
SALE AGENCY TO SELL
As to Obligation to the Price
Buyer pays the price. Agent delivers the price,
which he got from his
buyer, to his principal.
As to Transfer of Ownership
Buyer receives the Agent receives the
goods as owner. goods as goods of the
principal who retains his
ownership over them.
As to Warranty of the Object Sold

Test: If the condition is imposed upon the seller’s Seller warrants the Agent makes no
obligation to transfer the ownership of and deliver thing sold (CIVIL warranty for which he
the thing, there is a conditional sale. (Santos v. CA, CODE, Arts. 1547, assumes personal
G.R. No. 120820, August 1, 2000). 1548, 1561, 1562, liability as long as he
1564, 1565, and 1566). acts within his authority
However, if the condition is imposed upon the and in the name of the
buyer’s obligation to pay the price, the sale is still seller.
absolute. Payment of the purchase price is part of
the consummation stage of the contract of sale.
(Heirs of J.M. Mascuñana v. CA, G.R. No. 158646,
June 23, 2005).
 SALE AGENCY TO SELL CONTRACT FOR A
SALE
PIECE OF WORK
As to the Right to Return the Thing
CODE, Arts. 1717-
Buyer, as a general Agent can return the 1718).
rule, cannot return the goods in case he is
object sold. unable to sell the same As to Object of the Contract
to a third person.
Sale of a manufactured The services dominate
As to the Right Over the Thing item; it is a sale of goods the contract even
even though the item is though there is a sale
Buyer, being the owner, The agent, in dealing manufactured by labor of goods involved (DE
can deal with the thing with the thing received, furnished by the seller LEON, supra at 55).
sold as he pleases. must act according to and upon previous order
the instructions of the of the customer (DE
principal. LEON, supra at 55).
As to Revocability As to Applicability of Statute of Frauds
Contract of sale is not Essentially revocable, Governed by the Statute Not governed by the
unilaterally revocable because it covers an of Frauds (CIVIL CODE, Statute of Frauds (DE
(VILLANUEVA supra at underlying fiduciary Art. 1483). LEON, supra at 55).
29). relationship between
the principal and the As to Existence of Thing
agent (CIVIL CODE,
Arts. 1919-1920). The thing transferred is The thing transferred
one which would have is not in existence and
(CIVIL CODE, Art. 1466; DE LEON, supra at 51-52) existed and would have would never have
been the subject of sale existed but for the
CONTRACT FOR A PIECE OF WORK to some other person, order of the party
When a factory accepts a job that requires the use even if the order had not desiring to acquire it
of extraordinary or additional equipment, or if it been given. (DE LEON, supra at
involves services not generally performed by it, the 55).
factory thereby contracts for a piece of work
(Celestino Co. v. CIR, G.R. No. L-8506, August 31, As to Rules in Determining if the Contract
1956). is One of Sale or a Piece of Work

The distinction between a contract of sale and one If ordered or If manufactured

for work, labor, and materials is tested by the inquiry manufactured in the especially for the
ordinary course of customer and upon his
whether the thing transferred is one not in existence
business (CIVIL CODE, special order, and not
and which never would have existed but for the order Art. 1467). for the general market
of the party desiring to acquire it, or a thing which (CIVIL CODE, Art.
would have existed and has been the subject of sale 1467).
to some other persons even if the order had not been
given (Del Monte PH, Inc. v. Aragones, G.R.
153033, June 23, 2005). BARTER
By the contract of barter or exchange one of the
SALE AND CONTRACT FOR A PIECE parties binds himself to give one thing in
OF WORK, DISTINGUISHED consideration of the other's promise to give another
thing (CIVIL CODE, Art. 1638).
CONTRACT FOR A
SALE
PIECE OF WORK SALE AND BARTER, DISTINGUISHED
As to Risk of Loss SALE BARTER

Borne by the buyer Borne by the worker or As to Nature

(CIVIL CODE, Arts. contractor, not by the
1189, 1480, 1538). employer [the person A thing is given in A thing is given in
who ordered] (CIVIL exchange for a price exchange for another
certain in money or its thing (CIVIL CODE, Art.
1638).
 SALE BARTER SALE AND DACION EN PAGO,
DISTINGUISHED
equivalent (CIVIL
SALE DATION IN PAYMENT
CODE, Art. 1458).

As to Applicable Law As to Existence of Credit

Law on Sales Law on Barter or There is a re-existing

No pre-existing credit.
credit.
Exchange (CIVIL
CODE, Arts. 1638- As to Payment of Price
1641).
Buyer still has to pay the The debtor receives the
As to Applicability of Statute of Frauds price. payment before the
The rules on the Statute The rules on Statute of contract is perfected.
of Frauds, which apply Frauds, which apply to As to Consideration
to the sale of real the sale of real property
property and personal and personal property On the part of the seller: On the part of the
property bought at P500 bought at P500 or the price. debtor: the
or more, apply. more, do not apply extinguishment of the
(VILLANUEVA, supra On the part of the buyer: debt.
at 18). the acquisition of the
object. On the part of the
When the Consideration is Partly in Money creditor: the acquisition
and Partly in Another Thing of the object offered in
lieu of the original
1. The transaction is characterized by the
credit.
manifest intention of the parties.
2. If there is no manifest intention – As to Determination of Price
a. Barter if the value of the thing is more
valuable than money (value of the thing > Greater freedom in Less freedom in
money) determining the price. determining the price.
b. Sale if the value of the thing is equal or less
than the amount of money (CIVIL CODE, As to Obligation
Art. 1468). (Value of the thing = or <
money). Obligations are created Obligations are
(CIVIL CODE, Art. extinguished (CIVIL
1458). CODE, Art. 1245).
RULE ON MONEY EXCHANGE
If local currency is exchanged for foreign currency, As to Governing Law
there is purchase and sale.
Law on Sales (CIVIL CODE, Art. 1245).
If the local currency is exchanged with other (DE LEON, supra at 58-59)
denominations of the same local currency, there is
barter.
LEASE
The rule is the same if a foreign currency is A contract whereby one person (lessor) binds
exchanged in the Philippines for another foreign himself to grant temporarily the enjoyment or use of
currency (5 PINEDA, Civil Code of the Philippines a thing or to render of some work or service to
Annotated V, (2010), p. 42 [hereinafter, 5 PINEDA, another (lessee) who undertakes to pay some rent,
Civil Code]). compensation or price therefor (DE LEON, supra at
703).
DATION IN PAYMENT
(DACION EN PAGO) SALE AND LEASE, DISTINGUISHED
Dation in payment is a mode of extinguishment of SALE LEASE
obligation whereby property is alienated to the
creditor in satisfaction of a debt in money. As to transfer of ownership

Ownership is No transfer of
transferred upon ownership because the
rights of the lessee are
 regarding the reservation of ownership to the
SALE LEASE
seller, it will be construed as a contract to sell if
delivery (CIVIL CODE, limited to the use and the true intent of the parties is to transfer the
Art. 1496). enjoyment of the thing ownership of the properties only upon the
leased (CIVIL CODE, buyer’s full payment of the purchase price (Sps.
Art. 1643). Orden, v. Sps. Aurea, G.R. No. 172733, August
20, 2008).
As to extent of transfer
3. There is a contract to sell when execution of a
Permanent transfer of Temporary transfer of deed of absolute sale was made dependent
ownership, unless possession (DE LEON, upon the proper court's approval of the sale of
subject to a resolutory supra at 720). the shares of the minor owners. A contract to sell
condition (CIVIL CODE, is a bilateral contract whereby the prospective
Art. 1465). seller, while expressly reserving the ownership
of the subject property despite delivery thereof
As to who may convey the property to the prospective buyer, binds himself to sell the
said property exclusively to the latter upon his
Seller must be the Lessor need not be the fulfillment of the conditions agreed upon. The
owner at the time the owner (DE LEON, fulfillment of the suspensive condition will not
property is delivered, or supra at 720). automatically transfer ownership to the buyer
at least authorized by although the property may have been previously
the owner to transfer delivered to him. The prospective seller still has
ownership (CIVIL to convey title to the prospective buyer by
CODE, Art. 1459). entering into a contract of absolute sale (Villamil
v. Sps. Erguiza, G.R. No. 195999, June 20,
As to significance of price of object
2018).
Usually, the selling The price of the object,
price is mentioned, as distinguished from the CONTRACT OF SALE AND CONTRACT
the parties involved can rent, is usually not TO SELL, DISTINGUISHED
fix it. However, the mentioned (DE LEON,
CONTRACT OF CONTRACT TO SELL
fixing of the price supra at 720).
SALE
cannot be left to the
discretion of one of the As to Effect of Perfection of Contract
contracting parties
(CIVIL CODE, Art. Gives rise to reciprocal Only gives rise to a
1473). demandable reciprocal suspensive
obligations: conditional obligation
CONTRACT TO SELL (i.e., non-demandable
1. On seller - to obligation until the
1. A bilateral contract where the prospective seller, transfer ownership condition happens) on
while expressly reserving the ownership of the and deliver the seller to transfer
subject property despite delivery thereof to the possession of the ownership only when the
prospective buyer, binds himself to sell the said thing buyer paid the price in
property exclusively to the prospective buyer full.
upon fulfillment of the condition agreed upon, 2. On buyer – to pay
that is, full payment of the purchase price. a price certain in
Failure to do so is not a breach but a situation money or its
preventing the obligation of the vendor to convey equivalent (CIVIL
title from acquiring obligatory force. Thus, for its CODE, Art. 1458).
non-fulfillment, there will be no contract to speak
of for the obligor failed to perform the suspensive
condition which enforces a juridical relation As to Transfer of Ownership
(Zamora Realty and Dev’t Corporation v. Office
of the President, G.R. No. 165724, November 2, Title passes to the Ownership will pass only
2006). buyer upon delivery of upon full payment of the
the thing sold (CIVIL price (CIVIL CODE, Art.
2. The real character of the contract is determined CODE, Art. 1496). 1478).
by the intention of the parties. Although a
document is denominated as “Deed of Absolute
Sale,” and there is no provision therein As to Effect of Non-Payment of Price
 CONTRACT OF CONTRACT TO SELL
A deed of sale is absolute in nature although
SALE
denominated as a “Deed of Conditional Sale” where
Failure to pay is a It is not a breach of the nowhere in the contract in question is a proviso or
negative resolutory contract but simply an stipulation to the effect that title to the property sold
condition, which puts event that prevents the is reserved in the vendor until the full payment of the
an end to the obligation of the vendor purchase price, nor is there a stipulation giving the
transaction (CIVIL to convey title from vendor the right to unilaterally rescind the contract
CODE, Art. 1179). acquiring a binding force from the moment the vendee fails to pay within a
(Manuel Uy & Sons, Inc. fixed period (Dignos v. CA, G.R. No. L-59266
v. Valbueco, Inc., G.R. February 29, 1988).
No. 179594, September
11, 2013). The Suspensive Condition in a Contract to Sell
is Commonly Full Payment of the Purchase Price
As to Remedy in Case of Non-Payment of A contract to sell is akin to a conditional sale where
Price the efficacy or obligatory force of the vendor's
obligation to transfer title is subordinated to the
1. Specific Action to recover happening of a future and uncertain event, so that if
performance; OR possession–if the buyer the suspensive condition does not take place, the
2. Rescission refuses to surrender the parties would stand as if the conditional obligation
thing to the seller. had never existed. The suspensive condition is
With the payment of commonly full payment of the purchase price
damages in either (Spouses Intac v. Spouses Cueto, G.R. No. 204735,
case (CIVIL CODE, February 19, 2018).
Art. 1191).
ABSOLUTE CONTRACT OF SALE AND
As to Ownership of Vendor
CONDITIONAL CONTRACT OF SALE,
Vendor has lost and Title remains in the DISTINGUISHED
cannot recover the vendor unless and until ABSOLUTE CONDITIONAL
ownership until and the vendee does not CONTRACT OF SALE CONTRACT OF SALE
unless the contract of comply with the
sale itself is resolved condition precedent. As to When Title Passes
and set aside.
Title passes to the There is a stipulation
As to Execution of Sale Document buyer upon delivery. reserving the title to the
seller until the fulfillment
Vendee becomes the Vendor still need to of the condition even if
owner of the property execute another there is delivery.
upon delivery of the instrument conveying
thing sold. the property to the As to Right to Rescind the Contract
vendee (e.g., deed of
absolute sale). Both parties have the There is a stipulation
(DE LEON, Supra at 21-23). right to rescind the that the seller may
contract. unilaterally rescind the
contract in case of non-
CONDITIONAL SALE fulfillment of the
1. In conditional obligations, the acquisition of condition.
rights, as well as the extinguishment or loss of
those already acquired, shall depend upon the (Dignos v. CA, G.R. No. L-59266, Feb. 29, 1988).
happening of the event which constitutes the
obligation (CIVIL CODE, Art. 1181);

2. There was no perfected sale of a lot if it was

conditionally or contingently awarded subject to
the approval by the city council of the proposed
consolidation subdivision plan, and the approval
of the award by the valuation committee and
higher authorities (People’s Homesite &
Housing Corp. v. CA, G.R. No. L-61623,
December 26, 1984).
 CONDITIONAL SALE AND CONTRACT It is a preparatory contract in which one party grants
TO SELL, DISTINGUISHED to the other, for a fixed period and under specified
conditions, the power to decide, whether or not to
CONDITIONAL SALE CONTRACT TO SELL enter into a principal contract. It binds the party who
has given the option not to enter into a principal
As to Reservation of Title to the Subject contract with any other person during the period
Property designated, and, within that period, to enter into such
contract with the one to whom the option was
In both cases the seller may reserve the title to
granted, if the latter should decide to use the option.
property until fulfillment of the suspensive
It is a separate agreement distinct from the contract
condition (e.g., payment) (Serrano v. Caguiat,
of sale, which the parties may enter into upon the
G.R. No. 139173, February 28, 2007).
consummation of the option (Carceller v. CA, G.R.
As to Effect of Fulfillment of Suspensive No. 124791, February 10, 1999).
Condition
CONTRACT OF SALE AND OPTION
The sale is perfected; if Ownership is not CONTRACT, DISTINGUISHED
there has been previous automatically
delivery of subject transferred to the buyer CONTRACT OF SALE OPTION CONTRACT
property to the buyer, (even if there has been
As to Kind of Contract
ownership previous delivery to
automatically transfers him) upon fulfillment of Bilateral contract. Unilateral contract. Only
to the buyer by suspensive condition the offeror has an
operation of law without (i.e., full payment of obligation
any further act on the purchase price). (VILLANUEVA, supra at
part of the seller. 125).
Seller still has to convey
title to prospective As to Consideration
buyer by entering into a
contract of absolute Consideration must be Consideration may be
sale. a price certain in money anything of value.
or its equivalent (CIVIL
As to Effect of Sale of the Subject Property to CODE, Art. 1458). Such consideration is
Third Persons separate and distinct
from the purchase price
Upon the fulfillment of There is no double sale (San Miguel Properties
suspensive condition, (because there is no Philippines, Inc. v.
sale becomes absolute previous sale of Huang, G.R. No.
which affects the property despite 137290, July 31, 2000).
seller’s title. fulfillment of suspensive
condition). As to Consent
The third person
becomes a buyer in bad The consent is the
The consent is the
faith if he possesses The third person is not a acceptance by the
acceptance of the offer
constructive or actual buyer in bad faith. offeree of the offeror’s
itself whereby the
knowledge of defect in promise to sell (or to
Prospective buyer offeree asserts his or
seller’s title. buy) the determinate
cannot seek relief of her right or privilege to
thing, i.e., the offeree
buy (or to sell), which
A subsequent buyer reconveyance of agrees to hold the right
constitutes as his or her
cannot defeat the first property. or privilege to buy (or to
consent to the sales
buyer’s title. sell) within a specified
contract.
period.
(DE LEON, supra at 29).
As to Subject Matter
OPTION CONTRACT
An option contract is an accepted promise to buy or The determinate thing the right or privilege to
to sell a determinate thing for a price certain which itself. buy (or to sell) a
is binding upon the promisor if the promise is determinate thing for a
supported by a consideration distinct from the price price certain (Philippine
(CIVIL CODE, Art. 1479). National Oil Company
v. Keppel Philippines
 Holdings, G.R. No.
202050, July 25, 2016)
ELEMENTS OF A VALID OPTION
CONTRACT: (CSP)
1. Consent;
2. Subject Matter
– An option right to an “unaccepted unilateral
offer to sell, or to buy” or an “accepted promise
to sell or promise to buy”:
a. A determinate object or determinable object;
b. For a price certain, including the manner of
payment thereof;
3. Prestation
– A consideration separate and distinct from the
purchase price for the option given
(VILLANUEVA, supra at 126).
NOTE: In an option contract, the option granted to
the offeree is for a fixed period and a determined
price. Lacking these two essential requisites, what is
involved is only a right of first refusal (DE LEON,
supra at 101).
WHEN THERE IS NO CONSIDERATION
PRESENT
The Supreme Court held that without a consideration
separate and distinct from the purchase price, an
option contract would be void as a contract, but
would still constitute a valid offer, so that if the
option is exercised prior to its withdrawal, the offer is
accepted, and a valid and binding contract of sale is
entered into (Sanchez v. Rigos, G.R. No. L-25494,
June 14, 1972).
When the offeror has allowed the offeree a certain
period to accept, the offer may be withdrawn at any
time before acceptance by communicating such
withdrawal, except when the option is founded upon
a consideration, as something paid or promised
(CIVIL CODE, Art. 1324).
Accordingly, when an option to buy or to sell is not
supported by a consideration separate from the
purchase price, the option constitutes as an offer to
buy or to sell, which may be withdrawn by the offeror
at any time prior to the communication of the
offeree's acceptance. When the offer is duly
accepted, a mutual promise to buy and to sell under
the first paragraph of Article 1479 of the Civil Code
ensues and the parties' respective obligations
become reciprocally demandable (PNOC v. Keppel
Philippines Holdings, Inc., G.R. No. 202050, July 25,
2016).
NOTE: There are other cases decided differently.
RULES WHEN A PERIOD IS GIVEN TO
THE OFFEREE WITHIN WHICH TO
ACCEPT THE OFFER (I.E., OPTION)
1. If the period itself is not founded upon or
supported by a separate consideration, the
offeror is still free and has the right to withdraw
the offer before its acceptance, or, if an
acceptance has been made, before the offeror’s
coming to know of such fact, by communicating
that withdrawal to the offeree (Sanchez
Doctrine);
2. The right to withdraw, however, must not be
exercised whimsically or arbitrarily; otherwise, it
could give rise to a damage claim under Article
19 of the Civil Code;
3. If the period has a separate consideration, a
contract of option is deemed perfected, and it
would be a breach of that contract to withdraw
the offer during the agreed period;
4. The option is an independent contract by itself
and should be distinguished from the projected
main agreement. If the optioner-offeror
withdraws the offer before its acceptance
(exercise of option) by the optionee-offeree, the
latter may not sue for specific performance on
the proposed contract (object of the option)
since there is no perfection of the option
contract. The optioner-offeror, however, is liable
for damages due to breach of the option
contract; and
5. Care should be taken of the real nature of the
consideration given, for if in fact, it has been
intended to be part of the consideration for the
main contract with a right of withdrawal on the
part of the optionee, the main contract could be
deemed perfected; a similar instance would be
an earnest money in a contract of sale that can
evidence its perfection (Ang Yu Asuncion v. CA,
G.R. No. 109125, December 2, 1994).
PROPER EXERCISE OF OPTION
The payment of the price is contingent upon the
delivery of the deed of sale. Unless and until the
owner has done this, the buyer who has the option
is not and cannot be held in default in the discharge
of his obligation to pay (Nietes v. CA, G.R. No. L-
32873, August 18, 1972). Also, since the obligation
to pay is not yet due, consignation in court of the
purchase price is not required (Heirs of Luis Bacus
v. CA, G.R. No. 127695, December 3, 2001).
PERIOD WITHIN WHICH TO ENFORCE
THE VALID EXERCISE OF AN OPTION
Even when an option is exercised within the option
period by the proper tender of the amount due,
nevertheless the action for specific performance to
enforce the option to purchase must be filed within
10 years after the accrual of the cause of action as
provided under Art. 1144 of the Civil Code (Dizon v.
CA, G.R. No. 122544, January 28, 1999).
EFFECT OF EXERCISE OF OPTION
Once an option is exercised, there arises a
reciprocal obligation. The performance of one
obligation is conditional on the simultaneous
fulfillment of the other obligation (Heirs of Luis Bacus
v. CA, G.R. No. 127695, December 3, 2001).
RIGHT OF FIRST REFUSAL
When a lease contract contains a right of first
refusal, the lessor is under a legal duty to the lessee
not to sell to anybody at any price until after he has
made an offer to sell to the latter at a certain price
and the lessee has failed to accept it. The lessee has
a right that the lessor's first offer shall be in his favor
(Tanay Recreation Center and Development Corp.
v. Fausto, G.R. No. 140182, April 12, 2005).
A deed of sale executed in favor of a third party not
deemed a purchaser in good faith, in violation of the
right of first refusal granted to the optionee is valid
but rescissible under Arts. 1380 to 1381[3] of the
New Civil Code which states that a contract which is
valid may be rescinded by reason of injury to third
persons (Riviera Filipina, Inc. v. CA, G.R. No.
117355, April 5, 2002).
In an option to buy, the basis of the right of first
refusal must be the current offer to sell of the seller
or offer to purchase of any prospective buyer. Only
after the optionee fails to exercise its right of first
priority under the same terms and within the period
contemplated could the owner validly offer to sell the
property to a third person, again, under the same
terms as offered to the optionee (Parañaque Kings
Enterprises, Inc. v. CA, G.R. No. 111538, February
26, 1997).
MUTUAL PROMISES TO BUY AND SELL
Promise to sell a determinate thing coupled with a
correlative promise to buy at a specified price is
binding as an executory agreement (CIVIL CODE,
Art. 1479).
In an agreement to buy and sell, which is an
executory contract, title to the property does not
pass to the promisee and the contracting parties are
merely given the right to demand fulfillment of the
contract in the proper cases, or damages for breach
thereof where it is not possible to carry out its terms
(Coronel v. CA, G.R. No. 103577, October 7, 1996).
EFFECT OF PROMISE
1. Accepted unilateral promise to sell or
buy (CIVIL CODE, Art. 1479, par. 2)
Only one makes the promise, which is accepted
by the other (e.g., A promise to sell to B, B
accepts the promise, but does not in turn
promise to buy).
When the offer is duly accepted, a mutual
promise to buy and to sell under the first
paragraph of Article 1479 of the Civil Code
ensues and the parties' respective obligations
become reciprocally demandable (PNOC v.
Keppel Philippines Holdings, Inc., G.R. No.
202050, July 25, 2016).
Pending notice of its withdrawal, the accepted
promise partakes the nature of an offer to sell,
which if accepted, results in a perfected contract
of sale, although the option is given without
consideration (Sanchez v. Rigos, G.R. No. L-
25494, June 14, 1972).
2. Bilateral promise to buy and sell (CIVIL
CODE, Art. 1479, par. 1).
When one party accepts the other’s promise to
buy, and the latter accepts the former’s promise
to sell a determinate thing for a price certain, it
has the same effect as a perfected contract of
sale since it is reciprocally demandable (DE
LEON, supra at 122).
Since it is reciprocally demandable, the parties
have the right to demand fulfillment or damages,
but there is no transfer of title of dominion yet. It
requires no consideration distinct from the
selling price.
The prospective seller still has to convey title to
the prospective buyer by entering into a contract
of absolute sale (Coronel v. CA, G.R. No.
103577, October 7, 1996).
RULES GOVERNING AUCTION SALES
(CIVIL CODE, Art. 1476)
1. Sales of separate lots by auction are separate
contracts of sale;
2. Sale is perfected when the auctioneer
announces its perfection by the fall of the
hammer or in other customary manner; and
Until such announcement is made:
a. Any bidder may retract his bid; and
b. The auctioneer may withdraw the goods
from the sale unless the auction has been
announced to be without reserve.
3. Seller or his agent has the right to bid in the
auction, provided:
a. Such right was reserved;
b. Notice was given that the sale was subject
to a right to bid on behalf of the seller; and
c. Right is not prohibited by law or by
stipulation.
 REASON: To avoid puffing or secret bidding by Optima Realty Corp. v. Securitron Security Services,
or on behalf of the seller (DE LEON, supra at G.R. No. 199648, January 28, 2015).
95).
EARNEST MONEY AND OPTION
The owner of the property sold at the auction may MONEY, DISTINGUISHED
provide terms under which the auction will proceed
and the same are binding upon all bidders, whether EARNEST MONEY OPTION MONEY
they knew of such conditions or not (Leoquinco v.
The Postal Savings Bank, G.R. No. L-23630, August As to Transfer of Ownership
25, 1925).
Title passes to the Ownership is reserved
buyer upon delivery of to the seller and is not
When the auction sale had already been perfected,
the thing sold. passed until full
a supplemental sale with higher consideration at the
payment.
instance of only one party could no longer be validly
executed (Dizon v. Dizon, G.R. No. 156539, As to Effect of Non-Payment
September 5, 2007).
Action for specific There can be an action
EARNEST MONEY OR “ARRAS” performance or for for specific
Something of value to show that the buyer was really rescission can be filed performance.
in earnest and given to the seller to bind the bargain by the injured party.
(DE LEON, supra at 137).
As to Consideration
It is considered as:
It is part of the purchase Money is given as a
1. Part of the purchase price (an advance or down
price. distinct consideration
payment), and earnest money is deducted from
for an option contract
the total price; and
(see CIVIL CODE, Art.
2. Proof of perfection of the contract (CIVIL CODE,
1479, Par. 2).
Art. 1482).
As to Obligation of the Buyer Upon Payment
NOTE: Option money may become earnest money of Consideration
if the parties agree, or when it is considered as such
based on other terms or words used in the contract When given, the buyer The would-be buyer is
(DE LEON, supra at 139). is bound to pay the not required to buy.
balance.
By agreement of the parties, the amount given may
be merely a deposit of what would eventually As to Perfection of Sale
become earnest money or down payment should a
contract of sale be made by them, not as a part of There is already a sale. Applies to a sale not yet
the purchase price and as a proof of the perfection perfected.
of the contract of sale but only as a guarantee that
the buyer would not back out of the sale. It is only a "Earnest money" and "option money" are not the
proof of the concurrence of all essential elements of same but distinguished thus; (a) earnest money is
a contract which establishes the existence of a part of the purchase price, while option money is the
perfected contract (Manila Metal Container Corp. v. money given as a distinct consideration for an option
PNB, G.R. No. 166862, December 20, 2006). contract; (b) earnest money given only where there
is already a sale, while option money applies to a
In a potential sale transaction, the prior payment of sale not yet perfected; and, (c) when earnest money
earnest money even before the property owner can is given, the buyer is bound to pay the balance, while
agree to sell his property is irregular and cannot be when the would-be buyer gives option money, he is
used to bind the owner to the obligations of a seller not required to buy, but may even forfeit it depending
under an otherwise perfected contract of sale. The on the terms of the option (Limson v. CA, G.R. No.
property owner-prospective seller may not be legally 135929, April 20, 2001).
obliged to enter into a sale with a prospective buyer
through the latter’s employment of questionable
EFFECT OF RESCISSION ON EARNEST
practices which prevent the owner from freely giving
his consent to the transaction; this constitutes a MONEY RECEIVED
palpable transgression of the prospective seller’s In the absence of an express stipulation, the seller
rights of ownership over his property, an anomaly cannot keep the earnest money received to answer
which the Court will certainly not condone (First for the damages sustained in the event the sale fails
due to the fault of the prospective buyer (Goldenrod,
Inc. v. CA, G.R. No. 126812, November 24, 1998).
EXPENSES OF EXECUTION AND
REGISTRATION
The expenses for the execution and registration of
the sale shall be borne by the vendor, unless there
is a stipulation to the contrary (CIVIL CODE, Art.
1487).
OBJECTS OF SALE
GENERAL RULE: A person cannot sell or convey
what he does not have or own.
EXCEPTIONS:
1. Sale of a thing having potential existence (CIVIL
CODE, Art, 1461);
2. Sale of future goods (CIVIL CODE, Art. 1462);
and
3. Contract for the delivery at a certain price of an
article which the vendor in the ordinary course of
business manufactures or procures for the
general market, whether the same is on hand at
the time or not (CIVIL CODE, Art. 1467).
1. Rights
Requisites:
a. Transmissible or personal (CIVIL CODE,
Art. 1459);
b. Licit – it should not be contrary to law,
morals, good customs, public order, or
public policy (CIVIL CODE, Arts. 1459 and
1347).
2. Things
Requisites:
a. Actual or possible (CIVIL CODE, Arts.
1461,1462 and 1465);
It must be existing, future, or subject to a
resolutory condition (CIVIL CODE, Arts.
1461, 1462, par. 2).
A thing is actual when it is existing. A thing
is possible when it has a potential existence.
NOTE: When the requisite that the thing
should be actual or possible does not exist
as to subject matter, the resulting contract of
sale would be void (CIVIL CODE, Art. 1409,
par. 3).
c.
b. Licit (CIVIL CODE, Art. 1459);
The thing must be licit, and the vendor must
have a right to transfer the ownership
thereof at the time it is delivered (CIVIL
CODE, Art. 1459).
Requisites: (Co-In-In)
i. It is not outside the Commerce of men;
ii. It is not Intransmissible; and
iii. It does not contemplate a future
Inheritance, unless expressly
authorized by law (CIVIL CODE, Art.
1347).
When the subject matter is illicit, the
resulting contract is void (CIVIL CODE, Art.
1409, par. 1).
Kinds of Illicit Things:
i. Illicit per se (of its nature); and
ii. Illicit per accidens (because of some
provisions of law declaring it illegal) (DE
LEON, supra at 31).
Examples of Void Sale Due to Being Illicit
per accidens:
i. Sale of animals suffering from
contagious diseases (CIVIL CODE, Art.
1575, par. 1).
ii. Sale of animals if the use or service for
which they are acquired has been
stated in the contract, and they are
found to be unfit therefor (CIVIL CODE,
Art. 1575, par. 2).
iii. Sale of future inheritance except in
cases expressly authorized by law
(CIVIL CODE, Art. 1347).
iv. Sale of land in violation of the
constitutional prohibition against the
transfer of lands to aliens (CONST., Art.
XII).
v. Pursuant to the Public Land Act, a
contract which purports to alienate,
transfer, convey, or encumber any
homestead within the prohibitory period
of five (5) years from the date of the
issuance of the patent (Binayug v.
Ugaddan, G.R. No. 181623, December
5, 2012).
vi. Narcotics (R.A. 6425).
vii. Wild birds or mammals (Act. 2590, Sec.
7).
viii. Rare wild plants (Act. 2983, Sec. 1).
ix. Poisonous plants or fruits (R.A. 1288).
x. Dynamited fish (R.A. 428, Sec. 1).
xi. Gunpowder and explosives (Sec. 1, Act.
2255).
xii. Firearms and ammunitions (P.D. 9).
Determinate or at Least Determinable
(CIVIL CODE, Arts. 1458 & 1460).
Determinate Thing – that which is:
i. Particularly designated; or
 ii. Physically segregated from all others of
the same class (CIVIL CODE, Art. 1460,
par. 1).
NOTE: A determinate thing is identified by
its individuality (DE LEON, supra at 36).
Illustration: A person may validly sell all the
cavans of rice inside a particular bodega but
if it is not specified and the seller has more
than one bodega, the contract shall be null
and void (DE LEON, supra at 86).
NOTE: Art. 1165 of the Civil Code provides
that if the obligation is to deliver a
determinate thing, the creditor has the right
to compel specific performance and to
recover damages for breach of the
obligation (JURADO, Obligations and
Contracts, (2010), p. 45 [hereinafter,
JURADO, Obligations and Contracts]).
NOTE: A contract of sale is also perfected
even when the exact quantity or quality of
the subject matter is not known, so long as
the source of the subject is certain and fixed
(National Grains Authority v. IAC, G.R. No.
74470, March 8, 1989).
GOODS
Includes all chattels personal but not things in action
or money of legal tender in the Philippines. The term
includes growing fruits or crops (CIVIL CODE, Art.
1636).
KINDS OF GOODS:
1. Existing goods
– Those that are owned or possessed by the
seller may be the object of sale (CIVIL CODE,
Art. 1462).
The seller must have the right to transfer
ownership at the time the thing is delivered.
Hence, it is not required that the seller is the
owner of the thing at the moment of the
perfection of the contract of sale (CIVIL CODE,
Art. 1459).
2. Future goods
– Cover goods that are to be manufactured,
raised, or acquired by the seller after the
perfection of the contract of sale (CIVIL CODE,
Art. 1462).
Property or goods which at the time of the sale
are not owned by the seller but are to be
acquired by him, cannot be the subject of an
executed sale but may be the subject of a
contract for the future sale and delivery thereof,
even though the acquisition of the goods
depends upon a contingency which may or may
not happen. In such case, the vendor assumes
the risk of acquiring the title and making the
conveyance or responding in damages for the
vendee's loss of his bargain (Martin v. Reyes,
G.R. No. L-4402, July 28, 1952).
NOTE: The sole owner of a thing may sell an
undivided interest therein (CIVIL CODE, Art. 1463).
A co-owner may sell, but the sale is limited to the
portion which may be allotted to him in the division
of the thing upon the termination of the co-ownership
(CIVIL CODE, Art. 493).
NOTE: The co-owners can dispose of their shares
even without the consent of the other co-owners
except when personal rights are involved (CIVIL
CODE, Art. 493). The effect is that the buyer
becomes a co-owner in the thing sold (DE LEON,
supra at 47).
NOTE: An undivided share of a specific mass, in
case of fungible goods, may be sold (CIVIL CODE,
Art. 1464).
Effect: The buyer becomes a co-owner with the
seller of the whole mass in the proportion in which
the definite share bought bears to the mass (CIVIL
CODE, Art. 1464).
If later on, it be discovered that the mass of fungible
goods contains less than what was sold, the buyer
becomes the owner of the whole mass, and the
seller shall supply whatever is lacking from goods of
the same kind and quality, subject to any stipulation
to the contrary (CIVIL CODE, Art. 1464).
NOTE: Things subject to a resolutory condition (e.g.
pacto de retro sale) may be the object of a contract
of sale (CIVIL CODE, Art. 1465).
NOTE: When the conditions have for their purpose
the extinguishment of an obligation to give, the
parties, upon the fulfillment of the said conditions,
shall return to each other what they have received
(CIVIL CODE, Art. 1190).
EMPTIO REI SPERATAE
(SALE OF THE THING EXPECTED)
It is the sale of a thing with potential existence,
subject to a suspensive condition that the thing will
come into existence (CIVIL CODE, Art. 1461).
If the subject matter does not come into existence,
the contract is deemed extinguished as soon as the
time expires or if it has become indubitable that the
event will not take place (CIVIL CODE, Art. 1461).
The contract of sale will not become effective. As
such, the buyer will have no obligation to pay the EMPTIO REI SPERATAE AND EMPTIO
price (DE LEON, supra at 40).
SPEI, DISTINGUISHED
Illustration: S binds himself to sell, for a specified EMPTIO REI
EMPTIO SPEI
price, to B a parcel of land if he wins a case for the SPERATAE
recovery of said land pending in the Supreme Court.
The obligation will arise if the “expected thing” (which As to Effectivity of the Contract
is the land) will come into existence (i.e. if he wins
the case). Before a decision is rendered, there is Sale is subject to the Sale is effective even if
only “the mere hope or expectancy” that thing will condition that the thing the thing does not come
come into existence (DE LEON, supra at 42). will exist; if it does not, into existence, UNLESS
there is no contract. it is a vain hope or
An emptio rei speratae covers only contracts of sale expectancy.
whose subject matter are determinate and has no
As to Uncertainty
application to determinable generic things since the
condition that they must come into existence is It is with regard to the It is with regard to the
wholly irrelevant, for generic subject matters are quantity and quality of existence of the thing.
never lost (VILLANUEVA, supra at 67). the thing and not the
existence of the thing.
EMPTIO SPEI (“SALE OF HOPE”)
Sale of a mere hope or expectancy, which is deemed As to Object of Sale
subject to a condition that the thing will come into
existence (CIVIL CODE, Art. 1461, par. 2). Future thing. Present thing which is
the hope or expectancy.
Illustration: B buys a sweepstakes ticket in the (DE LEON, supra at 42).
hope of winning a prize. Here, the object of the
contract is the hope itself, not the prize. The sale is NOTE: In case of doubt, the presumption is in favor
valid even if B does not win a prize because it is not of emptio rei speratae; it is more in keeping with the
subject to the condition that the hope will be fulfilled commutative character of the contract (Id. at 43).
(DE LEON, supra at 42).

Emptio spei typifies a situation where the

commutative nature of a contract of sale seems not
to be complied with (VILLANUEVA, supra at 76).
The sale of a vain hope or expectancy is void (CIVIL
CODE, Art. 1461). This affirms the requisite of
“possibility” of a subject matter as contrasted from
an impossible subject matter (VILLANUEVA, supra
at 67).
Illustration: Sale of a losing ticket for
sweepstakes already run.
PRICE
PRICE
The sum stipulated as the equivalent of the thing
sold and also every incident taken into consideration
for the fixing of the price, put to the debit of the
a vendee and agreed to by him (Inchausti & Co. v.
Cromwell, G.R. No. 6584, October 16, 1911).

However, the sale is valid if the ticket be a collector’s REQUISITES FOR VALID PRICE:
item (5 PARAS, Civil Code of the Philippines, (2016), (CARM2)
p. 21 [hereinafter, 5 PARAS]). 1. Certain or Ascertainable (CIVIL CODE, Art.
1458);
2. Real (CIVIL CODE, Art. 1471);
3. In Money or its Equivalent (CIVIL CODE, Arts.
1458 and 1468); and
4. Manner of payment must be agreed upon (CIVIL
CODE, Arts. 1458 and 1468).

REAL (NOT SIMULATED)

Price is real when at the perfection of the contract,
there is legal intention on the part of the buyer to pay
the price, and legal expectation on the part of the
seller to receive such price (VILLANUEVA, supra at
FALSE PRICE OR NON-PAYMENT OF
89).
CONSIDERATION PRICE
If the Price is Simulated declared, and what is
GENERAL RULE: The sale is void (CIVIL CODE, stated or declared in the
Art. 1471). sale is not the one
intended to be paid.
EXCEPTION: If it can be shown to be a donation or
another contract (CIVIL CODE, Art. 1471). As to Effect
The price is simulated when neither party had any
intention that the amount will be paid (Yu Bun Guan The statement of a false Failure to pay does not
v. Ong, G.R. No. 144735, October 18, 2001). cause or consideration make the sale null and
shall render a contract void for lack of
When a contract is void due to absence of void if it should not be consideration but
consideration, no title over the subject matter can be proved that it was results in buyer’s
conveyed. Nemo potest nisi quod de jure potest – no founded upon another default, for which the
man can do anything except what he can do lawfully cause which is true and seller may exercise his
(Traders Royal Bank v. CA, G.R. No. 93397, March lawful (CIVIL CODE, legal remedies
3, 1997). Art. 1353). (Balatbat v. CA, G.R.
No. 109410, August 26,
Requisites of Simulated Contract (FOP) If the price indicated in 1996).
1. An Outward declaration of will different from the the covering instrument
will of the parties; is false (i.e. there is REASON: Contract of
2. The False appearance must have been intended actually another price sale, being consensual,
by mutual agreement; and upon which the minds of is perfected by mere
3. The Purpose is to deceive third persons the parties have met), consent (CIVIL CODE,
(Payongayong v. CA, G.R. No. 144576, May 28, the contract of sale is Art. 1475). Delivery of
2004). valid, but the underlying the thing bought, or
deed is subject to payment of the price is
GENERAL RULE: When the price in a purported reformation to indicate not necessary for the
contract of sale is completely simulated, the in pari the real price agreed perfection of the
delicto non oritur actio shall apply, which denies all upon (CIVIL CODE, Art. contract (Alcantara-
recovery to the guilty parties inter se. Such principle 1359). Daus v Sps. De Leon.,
applies to cases where the nullity arises from the G.R. No. 149750, June
illegality of the consideration or the purpose of the There is a presumption 16, 2003.
contract (Modina v. CA, G.R. No. 109355, October that the consideration
25, 1999). exists and that it is
lawful. Even though it is
When the deed of sale states that the purchase price not stated in the
has been paid, but in fact has never been paid, the contract (CIVIL CODE,
deed of sale is null and void for lack of consideration. Art. 1354).
If no payment was actually made, this fact indicates
that its price purportedly paid was simulated (Heirs
of Ureta v. Heirs of Ureta, G.R. No. 165748, CERTAIN OR ASCERTAINABLE
September 14, 2011). 1. Certain
– Expressed and agreed in terms of specific
EXCEPTION: When the principle is invoked with pesos and/or centavos (VILLANUEVA, supra at
respect to inexistent and void contracts (Yu Bun 100).
Guan v. Ong, G.R. No. 144735, October 18, 2001).
2. Ascertainable
FALSE PRICE AND NON-PAYMENT – It is sufficient that the price is with reference
to another thing certain or that the determination
OF PRICE, DISTINGUISHED thereof be left to the judgment of a specified
FALSE PRICE OR NON-PAYMENT OF person or persons (CIVIL CODE, Art. 1469):
CONSIDERATION PRICE a. Fixed by a specified third person or persons
– if the third person or persons is unable or
As to Definition unwilling to fix the price, the contract shall
be inefficacious, unless the parties
The price is false when The failure of the buyer subsequently agree upon the price (CIVIL
there is a real price not to pay the price. CODE, Art. 1469).

If the third person or persons is prevented
from fixing the price or terms by fault of
either the seller or the buyer, the party not in
fault may have such remedies (rescission or
fulfillment, with damages in either case)
against the party in fault as are allowed the
seller or the buyer, as the case may be
(CIVIL CODE, Arts. 1469, 1191, par. 2 and
1594).
The party may demand from the courts the
fixing of a reasonable price, under the
principle that when the party prevents a
condition from happening, that condition can
be deemed fulfilled by the other party (CIVIL
CODE, Art. 1186).
Even before the fixing of the price by the
designated third person, a contract of sale is
deemed to be perfected and existing, albeit
conditional (VILLANUEVA, supra at 101).
Question: If the money paid is a counterfeit,
would the sale still be valid?
Answer: Yes, for we cannot say that the
consideration or cause of the contract is the
illegal currency. The real consideration or
cause is still the VALUE or price agreed
upon (5 PARAS, supra at 30).
b. Fixed by the courts – where the third person
or persons fixes the price in bad faith or by
mistake (CIVIL CODE, Art. 1469);
c. Fixed by reference to a definite day, or in a
particular exchange or market (CIVIL
CODE, Art. 1472).
Requisites: (MAD)
i. Meeting of the minds as to the subject
matter;
ii. Agreement that a price will be paid; and
iii. Delivery and appropriation
Price of Securities, Grains, Liquids, and Other
Things is Considered Certain When:
1. The price fixed is that which the thing would
have on a definite day, or in a particular
exchange or market (CIVIL CODE, Art. 1472);
2. An amount is fixed above or below the price on
such day, or in exchange or market, provided
said amount be certain (CIVIL CODE, Art.
1472); or
3. Fixed by reference to another thing certain
(CIVIL CODE, Art. 1469).
Article 1472 is especially applicable to fungible
things (e.g., securities, grains, liquids, etc.) the price
of which are subject to fluctuations of the market (DE
LEON, supra at 73).
Example: I can sell you today my Mont Blanc
fountain pen at the price equivalent to the stock
quotation two days from today of 100 shares of
PLDT (5 PARAS, supra at 35).
Under Art. 1469 of the Civil Code, the parties give
rise to a contract of sale when they appoint a third
party to fix the price. However, this is not allowed for
the determination of the subject matter of the sale.
REASON: The obligation to pay the price is a
fungible obligation; the price is essentially generic,
and generally, cannot be extinguished by fortuitous
event. On the other hand, the obligation to deliver a
subject matter and the title thereto is a specific
obligation, and therefore its designation cannot be
left to the will of a third party who may choose a
subject matter beyond the capacity of the seller to
comply with his obligations to deliver the same (DE
LEON, supra at 62).
FIXING OF THE PRICE BY ONE OF THE
PARTIES
The fixing of the price can never be left to the
discretion of one of the contracting parties. However,
if the price fixed by one of the parties is accepted by
the other, the sale is perfected (CIVIL CODE, Art.
1473).
Basis: The validity or compliance of a contract
cannot be made to depend upon the will of one party
(CIVIL CODE, Art. 1308).
The owner of a thing has the right to quote his own
price, reasonable or unreasonable. It is up to the
prospective buyer to accept or reject it (Cornejo v.
Calupitan, G.R. No. L-2342, October 27, 1950).
IN MONEY OR ITS EQUIVALENT
Article 1468 of the Civil Code recognizes that if the
consideration consists partly in money and partly in
another thing, the transaction can still be considered
a contract of sale when it is the manifest intention of
the parties.
NOTE: The phrase “or its equivalent” means that
there is certainty as to the price but what is given as
payment is an object (e.g., P50,000.00 worth of
Maggi noodles).
MANNER OF PAYMENT MUST BE
AGREED UPON
Before a valid and binding contract of sale can exist,
the manner of payment of the purchase price must
first be established since the agreement on the
manner of payment goes into the price, such that a
disagreement on the manner of payment is
tantamount to a failure to agree on the price (Sps.
Navarra v. Planters Development Bank, G.R. No.
172674, July 12, 2007).
GROSS INADEQUACY OF PRICE (CIVIL
CODE, Arts. 1355 and 1470)
The price must be grossly inadequate or shocking to
the conscience such that the mind revolts against it
and such that a reasonable man would neither
directly nor indirectly be likely to consent to it. It must
be stressed that the property was mortgaged by
Lasola to the Rural Bank for P100,000.00. It was
bought by the Rural Bank at the extra-judicial sale at
P108,185.34. Also, the Certificate Authorizing
Registration issued by the Bureau of Internal
Revenue to petitioners shows that the prevailing fair
market value of the property in 1989 was
P85,260.00. All these show that the price in the
amount of P150,000.00 paid by petitioners for the
purchase of the property was within reasonable
bounds (Tio v. Abayata, G.R. No. 160898, June 27,
2008).
Inadequacy of price may be a ground for setting
aside an execution sale but is not a sufficient ground
for cancellation of a voluntary contract of sale
otherwise free from invalidating effects (Babasa v.
CA, G.R. No. 124045, May 21, 1998).
1. VOLUNTARY SALES
GENERAL RULE: Mere inadequacy of price
does not affect the validity of the sale if fixed in
good faith and without fraud (Hulst v. PR
Builders, Inc., G.R. No. 156364, September 3,
2007).
EXCEPTIONS:
a. Where a low price indicates a vice of
consent, sale may be annulled (CIVIL
CODE, Art. 1355), or the contract is
presumed to be an equitable mortgage
(CIVIL CODE, Art. 1602, par. 1 (1));
b. Where the price is so low as to be “shocking
to the conscience,” sale may be set aside
(Aguilar v. Rubiato, G.R. No. L-14823,
December. 9, 1919);
c. Where the price is simulated such as when
the parties intended a donation or some
other act or contract (CIVIL CODE, Art.
1471); and
d. Where the parties did not intend to be bound
at all, the contract is simulated and void
(VILLANUEVA, supra at 131).
2. INVOLUNTARY OR FORCED SALES
GENERAL RULE: Mere inadequacy of the price
is not a sufficient ground for the cancellation of
the sale of real property (Ponce de Leon v.
Rehabilitation Finance Corporation, G.R. No. L-
24571, December 18, 1970).
EXCEPTIONS:
a. Where the price is so low as to be shocking
to the moral conscience, judicial sale of
personal property will be set aside; and
b. If in the event of a resale, a better price can
be obtained.
NOTE: The validity of the sale is not necessarily
affected where the law gives to the owner the
right to redeem, upon the theory that the lesser
the price, the easier it is for the owner to effect
redemption (The Abaca Corporation of the
Phils., v. Garcia, G.R. No. 118408, May 14,
1997).
3. RESCISSIBLE CONTRACTS OF
SALE
Inadequacy of price is a ground for rescission of
conventional sale in case of rescissible
contracts covered under Article 1381 of the Civil
Code, namely:
a. Those entered into by guardians whenever
the ward whom they represent suffer lesion
by more than one-fourth (¼) of the value of
the object of the sale; and
b. Those agreed upon in representation of
absentees, if the latter should suffer lesion
by more than one-fourth (¼) of the value of
the object of the sale.
EXISTENCE OF SALE EVEN WHEN NO
PRICE IS AGREED UPON
GENERAL RULE: When the price cannot be
determined in accordance with Articles 1469 to
1473, the contract is inefficacious (“inefficacious”
means “the inability to produce the effect wanted”).
EXCEPTION: The thing or a part thereof has been
delivered to and appropriated by the buyer, in which
case the buyer has to pay a reasonable price
therefor (CIVIL CODE, Art. 1474). It is based on the
fundamental principle that no one should enrich
himself at the expense of other.
Appropriation
“Acceptance” by the buyer, having treated the
subject matter as his own (VILLANUEVA, supra at
110).
Requisites for the Applicability of the Exception:
(MAD)
1. Meeting of the minds as to the subject matter;
2. Agreement that a price will be paid which fails to
meet the criteria of being certain or
ascertainable; and
3. Delivery by the seller and appropriation by the
buyer of the subject matter (Id. at 112).

Reasonable Price is generally the market price at
the time and place fixed by the contract or by law for
the delivery of the goods (DE LEON, supra at 74).
FORMALITIES OF
CONTRACT OF SALE
GENERAL RULE: Contracts shall be obligatory in
whatever form they may have been entered into,
provided all the essential requisite for their validity
are present (CIVIL CODE, Art. 1356).
EXCEPTION: When the law requires that a contract
be in some form in order that it may be valid or
enforceable, or that a contract be proved in certain
way, that requirement is absolute and indispensable.
(CIVIL CODE, Art. 1356).
THE FORM OF SALE WILL AFFECT THE
VALIDITY UNDER THE FOLLOWING
CIRCUMSTANCES: (PLN)
1. In a sale of a Piece of land or any interest therein
through an agent, the authority of the latter shall
be in writing; otherwise the sale shall be void
(CIVIL CODE, Art. 1874).
If the proof of capacity consists of a special
power of attorney duly notarized, mere
inspection of the face of such public document
already constitutes sufficient inquiry. If no such
special power of attorney is provided or there is
one but there appears to be flaws in its notarial
acknowledgment, mere inspection of the
document will not do; the buyer must show that
his investigation went beyond the document and
into the circumstances of its execution. Article
1874 of the Civil Code provides that "when a
sale of a piece of land or any interest therein is
through an agent, the authority of the latter shall
be in writing; otherwise, the sale shall be void."
In other words, if the subject SPA was not
proven to be duly executed and authentic, then
it cannot be said that the foregoing requirement
had been complied with; hence, the sale would
be void (Heirs of Sarili v. Lagrosa, G.R. No.
193517, January 15, 2014).
2. Sale of Large cattle must be in writing otherwise
the sale will be void; and no sale of large cattle
shall be valid unless the sale is registered with
the municipal treasurer who shall issue a
certificate of transfer (CIVIL CODE, Art. 1581;
P.D. 533).
3. Sale of land by “Non-Muslim hill tribe cultural
minorities all throughout the Philippines” is void
if not approved by the National Commission on
Indigenous Peoples (ADMINISTRATIVE CODE
OF MINDANAO AND SULU, Sec. 145).
WHEN FORM IS IMPORTANT IN
ENFORCEABILITY: (PReY Form)
The following must be in writing to be enforceable:
1. Sale of Personal property at a price not less than
Five Hundred Pesos (P500);
2. Sale of Real property or an interest therein
regardless of the price involved;
3. Sale of property or of an interest therein not to
be performed within a Year from the date thereof
regardless of the nature of the property and the
price involved; and
4. When an applicable statute requires that the
contract of sale be in a certain Form (CIVIL
CODE, Arts. 1403 par. 2, [a, d and e], and 1356).
EXCEPTIONS:
1. When there is a note or memorandum in writing
and subscribed by the party charged or his agent
(CIVIL CODE, Art. 1403);
2. When there has been partial consummation of
the sale (CIVIL CODE, Art. 1403.);
3. When there has been failure to object to the
presentation of evidence aliunde as to the
existence of a contract (Barretto v. Manila
Railroad Co., G.R. No. L-21313, March 29,
1924; VILLANUEVA, supra at 172); and
4. When sales are effected through electronic
commerce (R.A. 8792, The Electronic
Commerce Act, Sec. 6).
NOTE: Statute of Frauds is applicable only to
executory contracts and not to contracts which are
totally or partially performed (DE LEON, supra at
144).
Statute of Frauds is inapplicable in a case of a verbal
sale that had been executed (Heirs of Alido v.
Campano, G.R. No. 226065, July 29, 2019).
NOTE: Article 1358 of the Civil Code requires that
the form of a contract that transmits or extinguishes
real rights over immovable property should be in a
public document, yet the failure to observe the
proper form does not render the transaction invalid.
The necessity of a public document for said
contracts is only for convenience; it is not essential
for validity or enforceability (Diampoc v.
Buenaventura, G.R. No. 200383, March 19, 2018).
Even a sale of real property, though not contained in
a public instrument or formal writing, is nevertheless
valid and binding, for even a verbal contract of sale
or real estate; produces legal effects between the
parties. Consequently, when there is a defect in the
notarization of a document, the clear and convincing
evidentiary standard originally attached to a duly-
notarized document is dispensed with, and the
measure to test the validity of such document is
preponderance of evidence. Nevertheless, the
defective notarization of the deed does not affect the
validity of the sale of the house. Although Article
1358 of the Civil Code states that the sale of real
property must appear in a public instrument, the
formalities required by this article is not essential for
the validity of the contract but is simply for its greater
efficacy or convenience, or to bind third persons, and
is merely a coercive means granted to the
contracting parties to enable them to reciprocally
compel the observance of the prescribed form.
Consequently, the private conveyance of the house
is valid between the parties (Diampoc v.
Buenaventura, G.R. No. 200383, March 19, 2018).
IF NOTARY PUBLIC IS NOT
AUTHORIZED
If the deed of sale of land is notarized by a Notary
Public whose authority had expired, the sale would
still be valid, since for validity of the sale, a public
instrument is not even essential (Soriano v. Latoño,
G.R. No. L-3408, December 23, 1950).
IMPLIED IN FACT CONTRACT OF SALE
An Implied in Fact contract is one implied from facts
and circumstances showing a mutual intention to
contract. It is a contract, the existence and terms of
which are manifested by conduct of the parties and
not by direct or explicit words between them. To
create contracts implied in fact, circumstances must
warrant inference that one expected compensation
and the other to pay (University of the Philippines v.
PHILAB, G.R. No. 152411, September 29, 2004).
CAPACITY TO BUY OR
SELL
GENERAL RULE: All persons, whether natural or
juridical, who can bind themselves, have legal
capacity to buy and sell (CIVIL CODE, Art. 1489,
Par. 1 (1)).
EXCEPTIONS:
1. ABSOLUTE INCAPACITY
–Persons who cannot bind themselves (DE
LEON, supra at 184).
Minors, insane or demented persons, and deaf-
mutes, who do not know how to write, have no
legal capacity to contract (CIVIL CODE, Art.
1327).
The contracts entered into by such legally
incapacitated persons are not void, but merely
voidable, subject to annulment or ratification
(CIVIL CODE, Art. 1390, Francisco v. Herrera,
G.R. No. 139982, November 21, 2002).
a. Purchase by a Minor
GENERAL RULE: The contract is voidable
(CIVIL CODE, Art. 1390, par. 1).
EXCEPTION: Where necessaries are sold
and delivered to a minor or other person
without capacity to act, the incapacitated
person must pay a reasonable price therefor
(CIVIL CODE, Art. 1489, par. 2).
Necessaries cover everything
indispensable for sustenance, dwelling,
clothing, medical attendance, education,
and transportation, in keeping with the
financial capacity of the family (FAMILY
CODE, Art. 194).
b. Sale by Minor
The sale of real property made by minors
who have already passed the age of puberty
and adolescence and are near the adult age
when they pretend to have already reached
their majority, while in fact they have not,
and the other party had good reason to
believe that the minor was capable of
contracting, is valid. The parties cannot be
permitted afterwards to excuse themselves
from compliance with the obligation
assumed by them or to seek their
annulment. (RULES OF COURT, Rule 131,
Sec. 2) and the principle of estoppel applies
(Mercado and Mercado v. Espiritu, G.R. No.
L-11872, December 1, 1917).
c. Sale by Insane or Demented Persons
Contracts entered into during lucid intervals
by insane or demented persons are
generally valid. Contracts agreed to in a
state of drunkenness or during a hypnotic
spell are voidable (CIVIL CODE, Art. 1328).
2. RELATIVE INCAPACITY
–When certain persons, under certain
circumstances, cannot buy certain property
(Wolfson v. Estate of Martinez, G.R. No. L-5970,
October 13, 1911).
NOTE: Among people relatively incapacitated
are those mentioned in Articles 1490 and 1491
of the Civil Code (5 PARAS, supra at 90).
a. Husband and Wife
GENERAL RULE: A sale between husband
and wife is inexistent and void from the
beginning because such contract is
expressly prohibited by law (CIVIL CODE,
Art. 1409, par. 7).
NOTE: The prohibition applies to common-
law spouses. If the same rule is not applied,
“the condition of those who incurred guilt
would turn out to be better than those in
legal union. Here, the contract is void not
because it falls under Article 1490 but
because the Supreme Court deems such
contract as void for being contrary to morals
and public policy (Ching v. Goyangko, G.R.
No. 165879, November 10, 2006).
REASONS:
i. To prevent commission of fraud or
prejudice to third persons;
ii. To prevent one from unduly influencing
the other; and
iii. To avoid indirect donations (Medina v.
Collector of Internal Revenue, G.R. no.
L-15113, January 28, 1961).
EXCEPTIONS:
i. Regime of separation of property
governs them;
ii. A judicial separation of property under
Article 135 of the Family Code has been
decreed (CIVIL CODE, Art. 1490, par.
2);
iii. Moderate gifts on the occasion of family
rejoicing (FAMILY CODE, Art. 87).
NOTE: If the spouses had been legally
separated, there is no more prohibition for
them to sell properties to one another for
they are now governed by the regime of
separation of property (PINEDA, Sales and
Other Special Contracts, (2010), p. 108
[hereinafter PINEDA, Sales]).
Persons Permitted to Question the Sale
between Husband and Wife:
i. Persons who bear such a relationship to
the spouses or to the property itself that
such transfer interferes with their rights
or interest (Cook v. McMicking, G.R. No.
L-8913, March 3, 1914), i.e., heirs of
either spouse, as well as creditors at the
time of the transfer but not creditors who
became only such after the transaction;
and
ii. The Government is always an
interested party in all matters governing
taxable transactions (Medina v. CIR,
G.R. No. L-15113, January 28, 1961).
b. Incapacity by Reason of Relation to
Property (CIVIL CODE, Art. 1491)
The following cannot acquire property by
purchase, even at a public auction, either in
person or through the mediation of another:
(GAE-PJO)
i. Guardian, with respect to the property of
his ward;
Reason: Relationship is so intimate, the
dependence so complete and the
influence so great that any transaction
between the two (2) parties entered
while the relationship exists are
suspicious, and presumptively
fraudulent (DE LEON, supra at 194).
ii. Agents, with respect to the property
whose administration or sale may have
been entrusted to them, unless the
consent of the principal has been given;
REASON: The agent and the principal
form one juridical person (Id. at 195).
After the termination of the relationship,
the agent is not prohibited to purchase
a property belonging to the erstwhile
principal (Valera v. Velasco, G.R. No. L-
28050 March 13, 1928).
Neither is he prohibited from buying
properties of the principal, which are not
included among the properties of which
he was commissioned to sell (Moreno v.
Vilonea, 40 O.G. 2322 as cited in DE
LEON, supra at 151).
However, the agent may buy the
property placed in his hands for sale
and administration if the principal gives
his consent thereto (Cui v. Cui, G.R. No.
L-7041, February 21, 1957).
iii. Executor or administrator, with respect
to the property of the estate under
administration;
Executors do not administer hereditary
rights of any heir; hence, there is no
prohibition as to the purchase by an
executor of hereditary rights (Naval v.
Enriquez, G.R. No. 1318 April 12,
1904).
NOTE: With respect to Art. 1491 (1, 2,
and 3), the sale shall only be voidable
because in such cases only private
interests are affected (Wolfson v. Estate
 of Martinez, G.R. No. L-5970, October
13, 1911).
The defect can be cured by ratification
of the seller (CIVIL CODE, Arts. 1392-
1396).
iv. Public officers and employees, with
respect to the properties of the
government, its political subdivisions, or
GOCCs that are entrusted to them.
The prohibition includes judges and
government experts who, in any
manner, take part in the sale.
REASON: To prevent the opening of
the floodgates to abuse, as it would be
very easy for such persons to justify
gain or advantage on the part of the
persons whom they represent.
Precisely to avoid such temptation and
quibbling, Article 1491 has entirely shut
the door to such persons occupying
fiduciary positions, to even desire to
acquire, directly or indirectly, properties
of their ward, estate or principal, as the
case may be (VILLANUEVA, supra at
62).
v. Judges, justices, prosecuting attorneys,
clerks of courts, etc., with respect to
property in custodia legis; and
Prohibition with respect to Judges,
Justices
It is not required that some contest or
litigation over the property itself should
have been tried by the judge; such
property is in litigation from the moment
that it became subject to the judicial
action of the judge, such as levy on
execution (Tiangco v. Pabinguit, G.R.
No. L-10439, October 17, 1916).
Prohibition with Respect to Lawyers
For the prohibition to apply, the sale or
assignment of the property must take
place during the pendency of the
litigation involving the property. Where
the property is acquired after the
termination of the case, no violation of
paragraph 5, Article 1491 of the Civil
Code attaches (Sabidong v. Solas, A.M.
No. P-01-1448, June 23, 2013).
A thing is in litigation if there is a contest
or litigation over it in court or when it is
subject of the judicial action (Conjugal
partnership of Sps. Cadavedo v.
Lacaya, G.R. No. 173188, January 15,
2014).
The prohibition on purchase is all
embracing to include not only sales to
private individuals but also public or
judicial sales (Ramos v. Ngaseo, A.C.
No. 6210, December 9, 2004).
Violation of this prohibition would
constitute breach of professional ethics
and malpractice for which the lawyer
may be reprimanded, suspended or
disbarred from the practice of the legal
profession (Mananquil v. Villegas, A.M.
No. 2430, August 30, 1990).
While contingent fee agreements are
indeed recognized in this jurisdiction as
a valid exception to the prohibitions
under Article 1491(5) of the Civil Code .
. . this recognition does not apply to the
present case. A contingent fee
contract is an agreement in writing
where the fee, often a fixed percentage
of what may be recovered in the action,
is made to depend upon the success of
the litigation. The payment of the
contingent fee is not made during the
pendency of the litigation involving the
client’s property but only after the
judgment has been rendered in the case
handled by the lawyer (Conjugal
partnership of Sps. Cadavedo v.
Lacaya, G.R. No. 173188, January 15,
2014).
The fact that the property in question
was first mortgaged by the client to his
lawyer and only subsequently acquired
by the latter in a foreclosure sale long
after the termination of the case will not
remove it from the scope of the
prohibition for at the time the mortgage
was executed the relationship of lawyer
and client still existed. To rule otherwise
would be to countenance indirectly what
cannot be done directly (Fornilda v.
RTC, G.R. No. 72306, October 6, 1988).
Article 1491 (5) of the Civil Code
prohibits the purchase by lawyers of any
interest in the subject matter of the
litigation in which they participated by
reason of their profession. Here,
however, respondent lawyer was not
the purchaser or buyer of the property or
rights in litigation. For, in point of fact, it
was his son Julius, and not respondent
lawyer, who purchased the subject
 property (Santos v. Arrojado, A.C. No.
8502, June 27, 2018).
vi. Any Other person specially disqualified
by law (CIVIL CODE, Art. 1491).
NOTE: With respect to Art. 1491 (4, 5, and 6),
the sale shall be null and void; public interest is
involved (CIVIL CODE, Art. 1409, par. 1; Rubias
v. Batiller, G.R. No. L-35072, May 29, 1973).
NOTE: The persons disqualified to buy referred
to in Articles 1490 and 1491 are also disqualified
to become lessees of the things mentioned
thereon (CIVIL CODE, Art. 1646).
Examples of Persons Especially Disqualified by
Law:
1. Aliens who are disqualified to purchase private
agricultural lands, unless by hereditary
succession (intestate succession) (CONST. Art.
XII, Secs. 3 and 7).
Where a land is sold to an alien who later sold it
to a Filipino, the sale to the latter cannot be
impugned. In such case, there would be no more
public policy to be served in allowing the Filipino
seller or his heirs to recover the land as it is
already owned by a qualified person (Vicente
Godinez v. Fong Pak Luen, G.R. No. L-36731,
January 27, 1983).
Aliens may still be lessees even if they cannot
buy lands. Since the residence of aliens in the
Philippines is temporary, they may be granted
temporary rights such as a lease contract which
is not prohibited by the Constitution (DE LEON,
supra at 736; Krivenko v. Register of Deed, G.R.
No. L-630, November 15, 1947).
2. An unpaid seller having a right of lien or having
stopped the goods in transitu, who is prohibited
from buying the goods either directly or indirectly
in the resale of the same at a public or private
sale (CIVIL CODE, Art. 1533, par. 5).
3. The officer conducting the execution sale, or his
deputies cannot become a purchaser (RULES
OF COURT, Rule 39, Sec. 19).
NOTE: The prohibitions are applicable to sales in
legal redemption (CIVIL CODE, Art. 1619);
compromises (CIVIL CODE, Art. 2028); and
renunciations (CIVIL CODE, Arts. 6 and 1270).
SALE BY NON-OWNER
Ownership is necessary only at the time of delivery
(CIVIL CODE, Art. 1459). Thus, sale by non-owner
at time of perfection is valid.
When a person who is not the owner of a thing sells
or alienates and delivers it, and later the seller or
grantor acquires title thereto, such title passes by
operation of law to the buyer or grantee (CIVIL
CODE, Art. 1434).
PERFECTION STAGE:
1. Sale by owner
– Valid
2. Sale by non-owner
– Valid
CONSUMMATION STAGE:
1. Sale by owner
– The contract is valid; the transfer of title is also
valid.
2. Sale by non-owner
– The contract is valid because it has passed
perfection stage; the transfer of title is void (Id.
at 322-323).
GENERAL RULE: Where goods are sold by a
person who is not the owner thereof, and who
does not sell them under authority or with the
consent of the owner, the buyer acquires no
better title to the goods than the seller had
(CIVIL CODE, Art. 1505).
REASON: Nemo dat quod non habet (nobody
can dispose of that which does not belong to
him).
EXCEPTIONS: (ERJ-MTA-CU)
a. Owner is Estopped or precluded by his
conduct (CIVIL CODE, Art. 1505);
b. Sale made by the Registered or apparent
owner in accordance with registration laws
(CIVIL CODE, Art. 1505);
c. Sales sanctioned by Judicial or statutory
authority (CIVIL CODE, Art. 1505);
NOTE: The government does not warrant
the title to properties sold by the sheriff at
public auction or judicial sales (see CIVIL
CODE, Art. 1570).
 d. Purchases in Merchant's stores, fairs or
markets (CIVIL CODE, Art. 1505, par. 3;
CODE OF COMMERCE, Arts. 85-86).
NOTE: To allow recovery would retard
commerce.
e. When a person who is not the owner sells
and delivers a thing, and subsequently
acquires Title thereto (CIVIL CODE, Art.
1434);
f. When the seller has a voidable title which
has not been Avoided at the time of the sale
(CIVIL CODE, Art. 1506), provided that the
buyer acquires the goods–
a. In good faith;
b. For value; and
c. Without notice of the seller’s defect of
title.
g. Sale by Co-owner of whole property or a
definite portion thereof (CIVIL CODE, Art.
493);
NOTE: If a co-owner sells the whole
property as his, the sale will affect only his
share, but not those of the other co-owners
who did not consent to the sale. Only the
rights of the seller are transferred, thereby
making the buyer a co-owner of the property
(Tomas Claudio Memorial College, Inc. v.
CA, G.R. No. 124262. October 12, 1999).
h. Special rights of Unpaid seller (CIVIL
CODE, Arts. 1526-1533).
ARTICLE 1505 AND ARTICLE 1506,
DISTINGUISHED
Article 1505 refers to sale with void title, while
Article 1506 refers to a sale with voidable title.
SALE BY SELLER WITH VOIDABLE
TITLE
When a buyer buys a property from a seller with
voidable title to property, he acquires a good title to
the property if (CIVIL CODE, Art. 1506).
Requisites: (GFA)
1. He buys it in Good faith;
2. He buys it For value; and
3. He is not Aware of the seller’s defect of title.
REASON: Art. 1506 is predicated on the principle
that where loss has happened which must fall on one
of two innocent persons, it should be borne by him
who is the occasion of the loss (DE LEON, supra at
261).
Illustration: “A” purchased a genuine Rolex watch
from “B” who is a minor, “C” in turn purchased the
watch from “A”. Although the title of “A” is voidable
due to minority of “B”, “C” became the owner of the
watch after it was delivered to him there being no
annulment of the purchase made. The possible
remedy of “B” is to go after “A”.
TITLE AS TO MOVABLE PROPERTIES
GENERAL RULE: Possession of movable property
acquired in good faith is equivalent to title (CIVIL
CODE, Art. 559, par. 1).
EXCEPTIONS:
1. Owner lost the movable
– Owner may recover the movable without
reimbursement (CIVIL CODE, Art. 559, par. 1.);
and
2. Owner is unlawfully deprived of the movable
– Owner may recover the movable without
reimbursement (CIVIL CODE, Art. 559, par. 1).
Unlawful Deprivation
It is when the original owner has been
dispossessed without his consent (Dizon v.
Suntay, G.R. No. L-30817, September 29,
1972). It includes not only cases of theft or
robbery, but also those occasioned by swindling
or estafa (Del Rosario v. Lucena, G.R. No. L-
3546, September 13, 1907).
EXCEPTIONS TO THE EXCEPTIONS:
1. The person who possesses the movable
property has acquired the same in good faith at
a public sale (CIVIL CODE, Art. 559, par. 2);
NOTE: The owner cannot obtain its return
without reimbursing the price paid therefor
(CIVIL CODE, Art. 559, par. 2).
2. The buyer bought the movable at a merchant
store (CIVIL CODE, Art. 1505).
PUBLIC SALE
A sale of property at auction, where any and all
persons who choose are permitted to attend and
offer bids (BLACK’S LAW DICTIONARY).
Store is any place where goods are kept for sale,
whether by wholesale or retail (5 PARAS, supra at
132).

EFFECTS ON THE
CONTRACT WHEN THE
THING SOLD HAS BEEN
LOST
EFFECT OF LOSS OF THING AT THE
TIME OF SALE:
1. Thing Entirely Lost
– The contract shall be without any effect (CIVIL
CODE, Art. 1493, par. 1). Where the thing is
entirely lost at the time of perfection, the contract
is inexistent and void (CIVIL CODE, Art. 1409,
par. 3) because there is no object (CIVIL CODE,
Art. 1318, par. 2).
The thing is lost when it perishes, or goes out of
commerce, or disappears in such a way that its
existence is unknown, or it cannot be recovered
(CIVIL CODE, Art. 1189, par. 2).
2. Thing Partially Lost
– If the subject matter is only partially lost, the
vendee may elect between:
a. Withdrawing from the contract; or
b. Demanding the remaining part of the object,
paying its price in proportion to the sum
agreed upon (CIVIL CODE, Art. 1493, par.
2).
EFFECT OF LOSS IN CASE OF SPECIFIC
GOODS
Specific Goods – Goods identified and agreed
upon at the time a contract of sale is made (CIVIL
CODE, Art. 1636, par. 1).
Where the specific goods, without the knowledge of
the seller, have perished in part or have wholly or in
a material part so deteriorated in quality as to be
substantially changed in character, the buyer may:
1. Rescind or withdraw from the contract; or
2. Give it a legal effect, paying the proportionate
price of the remaining object (DE LEON, supra
at 207).
Divisible Sale: Option 2 is available only if the sale
is divisible (CIVIL CODE, Art. 1494, par. 2). A
contract is divisible when its consideration is made
up of several parts (CIVIL CODE, Art. 1420).
Indivisible Sale: It is believed that the buyer should
be made to pay only the proportionate price of the
remaining goods as provided for in Art. 1493(2) of
the Civil Code. If the sale is indivisible, the object
thereof may be considered as a specific thing (DE
LEON, supra at 207).
NEGOTIABLE
DOCUMENTS
OF TITLE
DOCUMENT OF TITLE
It is a document used in the ordinary course of
business in the sale or transfer of goods:
1. As a proof of the possession or control of the
goods; or
2. Authorizing or purporting to authorize the
possessor of the document to transfer or
receive, either by endorsement or by delivery,
goods represented by such document (CIVIL
CODE, Art. 1636).
KINDS:
1. Bill of Lading
– A document that serves as evidence of receipt
of goods for shipment issued by a common
carrier. It is an instrument of two-fold character.
It is at once a receipt and a contract. In the
former character it is an acknowledgment of the
receipt of the property on board his vessel by the
owner of the vessel. The receipt of the goods lies
at the foundation of the contract to carry and
deliver (PINEDA, Sales, supra 146);
2. Dock Warrant
– A warrant given by dock-owners to the owner
of merchandise imported and warehoused on
the dock upon the faith of the bills of lading as a
recognition of his title to the goods (DE LEON,
supra at 264);
3. Warehouse Receipt
– A document of title issued by a
warehouseman. It is a receipt wherein it is stated
that certain goods were received by the bailee to
be delivered to the bearer or to the order of any
person named in such receipt or to a specified
person (DE LEON, supra at 264); and
4. Quedan
– A warehouse receipt that covers sugar,
tobacco, rice or hemp (Philippine Legal
Encyclopedia, p. 811).
NEGOTIABLE DOCUMENT OF TITLE
A document of title in which it is stated that the goods
referred to will be delivered to the bearer, or to the
order of any person named in such document (CIVIL
CODE, Art. 1507).
HOW NEGOTIATED:
1. By Delivery
a. Where by the terms of the document, the
one issuing the same undertakes to deliver
the goods to the bearer (CIVIL CODE, Art.
1508, par. 1); or
b. Where by the terms of the document, the
one issuing the same undertakes to deliver
the goods to the order of a specified person,
and such person or a subsequent endorsee
has indorsed it in blank or to the bearer
(CIVIL CODE, Art. 1508, par. 2).
Mere delivery without indorsement is sufficient if
the document is deliverable to the bearer.
However, even though the document is
deliverable to the order of a specified person, if
the latter indorsed it in blank by simply signing
his name without specifying any person to whom
the goods are to be delivered or indorsed it to
bearer, the document may now be negotiated by
mere delivery (PINEDA, Sales, supra at 149).
2. By Endorsement and Delivery
– The endorsement may be in blank, to bearer,
or to a specified person (CIVIL CODE, Art.
1509).
If indorsed to a specified person, it may be again
negotiated by endorsement of such person in
blank, to bearer or to another specified person
(CIVIL CODE, Art. 1509).
WHO MAY NEGOTIATE:
1. The owner of the document (i.e., the person to
whom it was originally issued); or
2. Any person to whom the possession or custody
of the document has been entrusted by the
owner if:
a. By the terms of the document, the goods are
deliverable to the order of the person to
whom the possession or custody of the
document has been entrusted; or
b. By the time of such entrusting the document
is in such form that it may be negotiated by
delivery (CIVIL CODE, Art. 1512).
EFFECTS OF NEGOTIATION
A person to whom the document is negotiated
acquires:
1. Title to the goods as the person negotiating the
document to him had or had ability to convey to
a purchaser in good faith for value, and also
such title to the goods as the person to whose
order the goods were to be delivered by the
terms of the document had or had ability to
convey to a purchaser in good faith for value;
and
2. Direct obligation of the bailee issuing the
document to hold possession of the goods for
him according to the terms of the document as
fully as if such bailee had contracted directly with
him (CIVIL CODE, Art. 1513).
UNAUTHORIZED NEGOTIATION
As between the owner of a negotiable document of
title who indorsed it in blank and entrusted it to a
friend, and the holder of such negotiable document
of title to whom it was negotiated in good faith and
for value, the latter is preferred, under the principle
that as between two innocent persons, he who made
the loss possible should bear the loss (Siy Cong
Bieng v. Hongkong and Shanghai Banking Corp,
G.R. No. 34655, March 5, 1932).
A purchaser in good faith is one who has purchased
the property in good faith without notice of the defect
of the title of the seller and for valuable consideration
(Inquimboy v. Vda. De Cruz, G.R. No, L-13953, July
26, 1960).
THE VALIDITY OF THE NEGOTIATION
OF A NEGOTIABLE DOCUMENT OF
TITLE IS NOT IMPAIRED BY THE FACT:
1. That the negotiation was a breach of duty on the
part of the person making the negotiation; or
2. That the owner of the document was deprived of
the possession of the same by loss, theft, fraud,
accident, mistake, duress or conversion, if the
person to whom the document was negotiated
or a person to whom the document was
subsequently negotiated paid value therefor in
good faith without notice of the breach of duty or
loss, theft, fraud, accident, mistake, duress or
conversion (CIVIL CODE, Art. 1518).
It is in protecting the rights and contractual
expectations of a buyer in good faith that the law
encourages the public to accept by way of
negotiations and at face value negotiable
documents of title (VILLANUEVA, supra at 284).
NEGOTIABLE INSTRUMENT V.
NEGOTIABLE DOCUMENT OF TITLE
NEGOTIABLE NEGOTIABLE
INSTRUMENT DOCUMENT OF TITLE
As to Function
It operates as a It operates as proof of
substitute for money. the possession or
control of the goods.
Authorizes or purports
to authorize the
 transferee no additional right (CIVIL CODE, Art.
NEGOTIABLE NEGOTIABLE
1511).
INSTRUMENT DOCUMENT OF TITLE

possessor of the The term “negotiation” is used with respect to

document to transfer or documents negotiable in form while non-negotiable
receive, either by documents may simply be transferred thing (DE
endorsement or by LEON, supra at 269).
delivery, goods
represented by such A non-negotiable document contains terms wherein
document (CIVIL the goods are deliverable to a specified person. In
CODE, Art. 1636). contrast, the terms of a negotiable document provide
that it is deliverable to the bearer, or to the order of
As to Governing Law any person named in the document (DE LEON,
supra at 265).
Governed by the Governed by the Civil
Negotiable Instruments Code, and in some EFFECTS OF TRANSFER
Law cases, by the A person to whom the document is assigned
Warehouse Receipt acquires:
Law and the Code of 1. The title to the goods, subject to the terms of any
Commerce agreement with the transferor; and
As to Special Endorsement of a Bearer 2. The right to notify the bailee who issued the
Instrument document of the transfer and also acquire the
direct obligation of such bailee to hold
A bearer instrument is The special possession of the goods for him according to the
always a bearer endorsement of a terms of the document (CIVIL CODE, Art. 1514,
instrument even if a bearer instrument has pars. 1 and 2).
special endorsement is the effect of converting
made (NEGOTIABLE the bearer instrument NOTE: Notification is an operative act to transfer
INSTRUMENTS LAW, into an order instrument the title or possession of the goods in favor of
Sec. 40). (DE LEON, supra at the transferee.
267).
Before notification, the bailee is not bound to
As to Placing of the Words “Non-Negotiable” transfer whose right may be defeated by a levy
on the Instrument or Document or attachment or execution upon the goods by
the creditor of the transferor or by notification to
The instrument is no If words “non- such bailee of the subsequent sale of the goods
longer negotiable. negotiable” or the like (CIVIL CODE, Art. 1514, par. 3).
are placed on the
document, such There is no legal relationship between the
document may assignee and the bailee until the latter is
nevertheless be informed by the former of the assignment of the
negotiated by the holder document of title (VILLANUEVA, supra at 285).
(CIVIL CODE, Art.
1510). TRANSFER OF ORDER DOCUMENT
WITHOUT INDORSEMENT
NON-NEGOTIABLE DOCUMENT OF This article specifies the rights of a person with
TITLE whom an order document of title, which may not be
A document of title which does not state that the properly be negotiated by mere delivery, has been
goods referred to document are deliverable either to delivered, without indorsement.
bearer or to the order of any person named 1. Right to the goods as against the transferor; and
(VILLANUEVA, supra at 279). 2. Right to compel the transferor to indorse the
document.
HOW TRANSFERRED OR ASSIGNED The negotiation shall take effect as of the time when
A document of title which is not in such form that it the indorsement is actually made (CIVIL CODE, Art.
can be negotiated by delivery may be transferred by 1515).
the holder by delivery to a purchaser or donee. A
non-negotiable document cannot be negotiated and NOTE: If the Intention of the parties is that the
the endorsement of such a document gives the document should be merely transfer, the transferee
has no right to require the transferor to indorse the
document (DE LEON, supra at 277).
WARRANTIES ON NEGOTIATION OR
ASSIGNMENT
A person who negotiates or transfers a document of
title warrants that: (MINT-G)
1. The goods are Merchantable or fit for a particular
purpose;
2. He has knowledge of no fact which would Impair
the validity or worth of the document;
3. He has a legal right to Negotiate or transfer it;
4. He has a right to Transfer the title to the goods;
and
5. The document is Genuine (CIVIL CODE, Art.
1516).
The endorsement of a document of title shall not
make the endorser liable for any failure on the part
of the bailee who issued the document or previous
endorsers thereof to fulfill their respective
obligations (CIVIL CODE, Art. 1517). The
indorsement of a document of title in the law on sales
is merely a conveyance of the document by the
transferor to the holder. It is not a contract of
guaranty (DE LEON, supra at 279).
NOTE: The warranties of one who negotiates a
negotiable document of title, and one who assigns a
non-negotiable document of title are the same
(VILLANUEVA, supra at 311).
RULES ON LEVY / GARNISHMENT OF
GOODS
1. Negotiable Document of Title
Goods cannot be attached by garnishment or
levied, unless:
a. The document is first surrendered;
b. The negotiation of the document is enjoined;
or
c. The document is impounded by the court
(CIVIL CODE, Art. 1519).
A creditor whose debtor is the owner of a
negotiable document of title shall be entitled to
aid from the courts of appropriate jurisdiction by
injunction and otherwise in attaching the
document or in satisfying the claim by means
thereof as is allowed at law or in equity in regard
to property which cannot be attached or levied
upon by ordinary legal process (CIVIL CODE,
Art. 1520).
2. Non-Negotiable Document of Title
It cannot be negotiated but it can only be
transferred or assigned by delivery. Even if the
document is indorsed, the transferee acquires
no additional right.
Prior to notification of the bailee of the transfer
of document of title, the title of the transferee to
the goods may be defeated by levy of
attachment of execution (CIVIL CODE, 1514,
par. 3).
OBLIGATIONS OF THE
VENDOR
OBLIGATIONS OF THE VENDOR:
(ADDED-MENT)
1. Accord the buyer the right to examine the goods
(CIVIL CODE, Art. 1584);
2. Deliver the thing sold (CIVIL CODE, Arts. 1458
and 1495)–cannot be waived;
3. Deliver the fruits and accessories (CIVIL CODE,
Arts. 1164, 1166, and 1537);
4. Enter into a contract with the carrier on behalf of
the buyer as may be reasonable under the
circumstances (CIVIL CODE, Art. 1523);
5. Take care of the thing, upon perfection and prior
to delivery, with the proper Diligence of a good
father of a family (CIVIL CODE, Art. 1163;
VILLANUEVA, supra at 195);
6. Make warranties (CIVIL CODE, Arts. 1495,
1545-1581)–can be waived or modified;
warranty is not an essential element of the
contract of sale;
7. Pay for the Expenses for the execution and
registration of the sale, unless there is
stipulation to the contrary (CIVIL CODE, Art.
1487);
8. Notify the buyer regarding the necessity to
insure goods if it is usual to insure them (CIVIL
CODE, Art. 1523); and
9. Transfer ownership (CIVIL CODE, Arts. 1458
and 1495)–cannot be waived.
TRANSFER OF OWNERSHIP (CIVIL CODE,
Arts. 1458 and 1495)
GENERAL RULE: Ownership of the thing sold is
acquired only upon its delivery, actual or
constructive, to the buyer even if purchase was
made on credit (Alcantara-Daus v. Sps. De Leon,
G.R. No. 149750, June 16, 2003).
Payment of the purchase price is not essential to the
transfer of ownership, as long as the property sold
has been delivered (Sampaguita Pictures, Inc. v.
Jalwindor Manufacturers, Inc., G.R. No. L-43059,
October 11, 1979).
Non-payment only creates a right to demand
payment or to rescind the contract, or to criminal
prosecution in the case of bouncing checks (EDCA
Publishing and Distributing Corp. v. Santos, G.R.
No. 80298, April 26, 1990).
EXCEPTIONS (Cases Where There is
Reservation of Ownership Despite Delivery):
(PRANC)
1. Pactum reservati dominii (contractual
reservation of title)
– In sale, the general rule is that delivery of the
thing transfers ownership to the buyer (CIVIL
CODE, Art. 1477). However, the parties may
agree that the ownership shall remain with the
seller until the full payment of the purchase price
(CIVIL CODE, Art. 1478).
2. Implied Reservation of Ownership under Article
1503:
a. Where goods are shipped and, by the bill of
lading the goods are deliverable to the
seller, or his agent, or to the order of the
seller or agent–seller reserves ownership in
the goods;
b. Where goods are shipped, and by the bill of
lading the goods are deliverable to the order
of the buyer or his agent, but the possession
of the bill of lading is retained by the seller
or his agent–seller reserves a right to the
possession of the goods; and
c. Where the seller of the goods draws on the
buyer for the price and transmits the bill of
lading and bill of exchange to the buyer to
secure acceptance or payment of the bill of
exchange and the buyer does not honor the
bill of exchange. Here, the seller is the
drawer and the buyer is the drawee. If the
buyer, as drawee, does not honor the bill of
exchange, he shall return the bill of lading.
If he retains the same, he acquires no added
right thereby.
3. Sale on Acceptance/trial/approval/satisfaction
(CIVIL CODE, Art. 1502).
Ownership passes to the buyer only when:
a. He signifies his approval or acceptance to
the seller or does any act adopting the
transaction; or
b. He does not signify his approval or
acceptance but retains the goods without
giving notice of rejection, then if a time has
been fixed for the return of the goods, on the
expiration of such time, and, if no time has
been fixed, on the expiration of a reasonable
time (CIVIL CODE, Art. 1502, pars.1 and 2).
NOTE: In “Sale or Return,” ownership passes to
the buyer on delivery, but he may revest the
ownership in the seller by returning or tendering
the goods within the time fixed in the contract, or
if there is no time fixed, within a reasonable time
(CIVIL CODE, Art. 1502, par. 1). What is
reasonable is a question of fact. It depends upon
the prevailing circumstances. Moreover, the
decision to return or tender on the part of the
buyer is discretionary on his part without
reference to the quality of goods (PINEDA,
Sales, supra at 125).
4. Sale by a Non-Owner
– The contract is valid because it has passed the
perfection stage, but the transfer of title is void.
Rationale: Nemo dat quod non habet (nobody
can dispose of that which does not belong to
him) (Gochan v. Heirs of Baba, G.R. No.
138945, August 19, 2003).
5. Contract to sell (Coronel v. CA, G.R. No.
103577. October 7, 1996).
DELIVERY OF THE THING SOLD (CIVIL
CODE, Arts. 1458 and 1495)
It is a mode of acquiring ownership, as a
consequence of certain contracts such as sale, by
virtue of which, actually or constructively, the object
is placed in the control and possession of the
vendee.
Seller is bound to deliver all goods unless delivery
by installment has been agreed upon (CIVIL CODE,
Art. 1583).
Seller is bound to deliver the thing sold and its
accessions and accessories in the condition in which
they were upon the perfection of the contract (CIVIL
CODE, Art. 1537).
DELIVERY IN CASES OF EXECUTION
SALES
The judgment debtor in an execution sale is not
obliged to deliver the property sold to the buyer
immediately after the sale since he is given the right
of redemption. He can redeem the property within
one (1) year from the registration of the sale in the
Office of the Registry Property (Techico v. Serrano,
G.R. No. L- 12693, May 29, 1959).
It is only after the lapse of one (1) year from the
registration of the sale that the buyer may take
possession of the property. If the seller refuses to
surrender possession of the property, the buyer may
petition the court for a Writ of Possession (PINEDA,
Sales, supra at 113).
KINDS OF DELIVERY: (DAD-QTL)
1. Delivery through document of title (CIVIL CODE,
Arts. 1507-1520);
2. Actual or Real (CIVIL CODE, Art. 1497);
3. Delivery through carrier (CIVIL CODE, Art.
1503);
4. Quasi-tradition (CIVIL CODE, Art. 1501);
5. Tradition by operation of law (CIVIL CODE, Art.
1434); and
6. Legal or Constructive (CIVIL CODE, Art. 1498-
1500).
ACTUAL OR REAL
Placing the thing under the control and possession
of the buyer (CIVIL CODE, Art. 1497).
LEGAL OR CONSTRUCTIVE
Delivery is represented by other signs or acts
indicative thereof. It is a delivery by fiction of law.
Under Article 1496 of the Civil Code, constructive
delivery can take several forms, and may be any
“manner signifying an agreement that the
possession is transferred from the vendor to the
vendee.” The essence of most forms of constructive
delivery is the existence of an agreement between
the seller and the buyer, and that the latter is
understood to have control of the subject matter of
the sale (VILLANUEVA, supra at 200).
Requisites: (ACI)
1. The seller must have Actual possession and
control over the thing;
2. The object must be placed under Control of the
vendor; and
3. There must be an Intention to deliver the thing
for purposes of transferring ownership.
NOTE: (3I’S OF DELIVERY)
1. Identity
– The very same object must be delivered. The
absolute giving up of control and custody of the
property on the party of the vendor and the
assumption of the same by the vendee
(Equatorial Realty Development, Inc. v. Mayfair
Theater, Inc., G.R. No. 106063, November 21,
1996);
2. Integrity
– A seller’s duty is to deliver the thing sold in a
condition suitable for its enjoyment by the buyer
for the purposes contemplated (Consing v. CA,
G.R. No. 78272, August 29, 1989); and
3. Intentional
– The act of delivery must be coupled with the
intention of delivering the thing and putting the
buyer under control (Santos v. Santos, G.R. No.
133895, October 2, 2001).
NOTE: In all forms of delivery, it is necessary
that the act of delivery, whether constructive or
actual, should be coupled with the intention of
delivering the thing. The act, without the
intention, is insufficient. . . Without that intention,
there is no tradition (Union Motor Corporation v.
CA, GR 117187, July 20, 2001).
TYPES:
1. Delivery by Execution of Public
Instrument (CIVIL CODE, Art. 1498, par. 1)
– It gives rise to a prima facie presumption of
delivery, which is destroyed when actual
delivery is not effected due to legal impediment
(Ten Forty Realty v. Cruz, G.R. No. 151212,
September 10, 2003).
The notarized deed of sale has two
functions:
a. It operates as a formal or symbolic delivery
of the property sold; and
b. It authorizes the buyer to use the document
as proof of ownership (VILLANUEVA, supra
at 201).
Exceptions (Cases Where the Execution of
Public Instrument Does NOT Produce the
Effects of Delivery):
a. There is a stipulation in the instrument to the
contrary.
Instances where contrary stipulation is
present:
i. A certain date is fixed for the purchaser
to take possession of the property
subject of the conveyance;
ii. In sale by installments, where it is
stipulated that until the last installment is
made, the title to the property should
remain with the seller;
iii. When the seller reserves the right to use
and enjoy the property until the
gathering of the pending crops; or
iv. Where the seller has no control over the
thing sold at the moment of the sale,
and, therefore, its material delivery
could not have been made (Villamar v.
Mangaoil, G.R. No. 188661, April 11,
2012).
b. When at the time of the execution of the
public instrument, the subject matter was
not subject to the control of the seller or
there is an impediment that may prevent the
passing of the property.
 If, notwithstanding the execution of the
instrument, the purchaser cannot have the
enjoyment and material tenancy of the thing
and make use of it himself or through
another in his name, because such tenancy
and enjoyment are opposed by another, the
delivery has not been effected. It is not
enough for the vendor to vest unto the
vendee the ownership and the right of
possession over the property, but it must
also be placed in his control (Addison v.
Felix, G.R. No. L-12342, August 3, 1918).
c. The control or ability to transfer physical
possession and enjoyment does not subsist
for a reasonable length of time after the
execution of the instrument (Cebu Winland
Development Corporation v. Ong Siao Hua,
G.R. No. 173215, May 21, 2009).
The absence of control for a reasonable
length of time after execution would create
undue burden on the part of the buyer who
would be compelled to literally jump into the
possession of the subject matter soon after
signing the instrument, for he would then
obtain no remedy from the seller
(VILLANUEVA, supra at 207).
Since tradition is an obligation on the part of
the seller, then the burden must continue to
lie with the seller to grant the buyer a
reasonable period to take possession of the
subject matter (Vda. de Sarmiento v.
Lesaca, G.R. No. L-15385, June 30, 1960).
2. Traditio Symbolica
To effect delivery, the parties may use a token
or symbol to represent the thing delivered (e.g.,
key to a house) (CIVIL CODE, Art. 1498).
3. Traditio Longa Manu (Long Hand
Delivery)
Delivery of a thing by mere agreement where the
seller points out to the buyer the property without
the need of actually delivering (as when the thing
sold cannot be transferred to the possession of
the vendee at the time of sale) but must be within
the sight of the parties (CIVIL CODE, Art. 1499).
NOTE: The delivery “by mere consent or
agreement of the contracting parties” is qualified
by the phrase “if the thing sold cannot be
transferred to the possession of the vendee at
the time of the sale (DE LEON, supra at 231).
4. Traditio Brevi Manu (Short Hand
Delivery)
Before the contract of sale, the would-be buyer
was already in possession of the would-be
subject matter of the sale by virtue of another
title which is not ownership (e.g., as lessee), and
pursuant to a sale, he would now hold
possession in the concept of an owner (CIVIL
CODE, Art. 1499).
NOTE: Article 1499 expressly applies to
movable property. This notwithstanding, traditio
longa manu and tradition brevi manu, apply to
immovable property.
5. Traditio Constitutum Possessorium
Opposite of Traditio Brevi Manu (DE LEON,
supra at 231). The delivery consists in the
owner’s continuous possession of the property
he had already sold to another person, but his
present possession is no longer that of an owner
but under another capacity, like that of a lessee,
depository, etc. Under this kind of tradition, the
law considers all these formalities to have taken
place by agreement of the parties (Carbonell v.
CA, G.R. No. L-29972, January 26, 1976). There
is both constructive and actual delivery in
tradition constitutum possessorium (CIVIL
CODE, Art. 1500).
QUASI-TRADITIO
Delivery of rights, credits or incorporeal property,
made by:
1. Execution of a public instrument; or
2. Placing titles of ownership in the possession of
the vendee; or
3. The use and enjoyment by the buyer of the rights
pertaining to the incorporeal property, with the
seller’s consent (CIVIL CODE, Art. 1501).
TRADITION BY OPERATION OF LAW
When a non-owner who sells and delivers a thing
subsequently acquires title thereto, the title passes
by operation of law to the buyer (CIVIL CODE, Art.
1434).
DELIVERY THROUGH DOCUMENT OF
TITLE (CIVIL CODE, Arts. 1507-1520)
Please see the discussion on Negotiable
Documents of Title on page 545.
DELIVERY THROUGH CARRIER
GENERAL RULE: Where the seller is authorized or
required to send the goods to the buyer, delivery to
the carrier constitutes delivery to the buyer (CIVIL
CODE, Art. 1523).
EXCEPTIONS:
1. When a contrary intention appears (i.e., the
parties did not intend the delivery of the goods
through the carrier); or
2. Implied reservation of ownership (CIVIL CODE,
Art. 1503, pars. 1, 2 and 3).
KINDS OF DELIVERY TO CARRIER:
1. F.A.S. (Free Alongside Vessel)
The seller pays all charges and bears the risk
until the goods are placed alongside the vessel.
2. F.O.B. (Free on Board)
Goods are to be delivered free of expense to the
buyer to the point where they are F.O.B. The
point of F.O.B. (either at the point of shipment or
the point of destination) determines when the
ownership passes.
a. F.O.B. Shipping point–delivery of the
goods to the carrier is equivalent to delivery
to the buyer, and at that point the risk of loss
pertains to the buyer.
b. F.O.B. Destination–only when the vessel
has arrived at the point of destination would
there be delivery to the buyer; and prior to
that point in time, the risk of loss will be
borne by the seller.
3. C.I.F. (Cost, Insurance, Freight)
It signifies that the price fixed covers the costs of
the goods, the expenses of the freight and the
insurance all of which are to be paid by the seller
up to the point of destination.
4. C.O.D. (Collect on Delivery)
The carrier acts for the seller in collecting
purchase price, which the buyer must pay to
obtain possession of the goods (DE LEON,
supra at 293-295).
NOTE: The terms F.O.B. and C.O.D. merely make
rules of presumption, which yield to proof of contrary
intention (General Foods Corp. v. National Coconut
Corp., G.R. No. L-8717, November 20, 1956).
INSTANCES WHEN THE VENDOR IS
NOT BOUND TO DELIVER:
1. If vendee has not paid him the price (CIVIL
CODE, Art. 1524);
EXCEPTION: If parties stipulated on different
periods for delivery and payment of price,
vendor must deliver on the time agreed on
despite non-payment of price at the time of
delivery as price is considered due only upon the
expiration of the term agreed on (CIVIL CODE,
Art. 1193).
2. If no period for payment has been fixed in the
contract (CIVIL CODE, Art. 1524); or
3. A period for payment has been fixed in the
contract but the vendee has lost the right to
make use the term as provided in Article 1198
(CIVIL CODE, Art. 1536).
PLACE OF DELIVERY:
1. The place of delivery agreed upon;
2. In the absence of an agreement, place is
determined by usage of trade;
3. In the absence of an agreement and there is also
no prevalent usage, the seller’s place of
business;
4. In any other case, the place of delivery is the
seller’s residence; or
5. In case of specific goods known by the parties at
some place at the time of the perfection of sale,
such is the place of delivery, in the absence of
agreement or usage of trade to the contrary
(CIVIL CODE, Art. 1521).
Wherever the proper place of delivery may be, either
party acquires a right of action by being ready and
willing at that place to perform his legal duty, if the
other party is not present or even if present, is not
prepared to perform in a proper manner with what is
incumbent upon him (CIVIL CODE, Art. 1169, par.
3).
Where, however, the delivery was not effected at the
place specified in the contract, but the buyer
accepted the goods without complaint, the buyer
would be deemed to have waived the seller’s
failure to deliver according to the terms of the
contract and would be liable to pay the price agreed
upon (Sullivan v. Gird, 22 Ariz. 332 as cited in DE
LEON, supra at 284).
TIME OF DELIVERY:
1. Agreement of the parties; or
2. In the absence thereof, within a reasonable time
(CIVIL CODE, Art. 1521, par. 2).
Hour of delivery
The demand or tender of delivery to be effectual
must be made at a reasonable hour of the day (CIVIL
CODE, Art. 1521, par. 4)
DUTY OF SELLER TO PUT GOODS IN
DELIVERABLE CONDITION
Unless otherwise agreed, the seller bears the
expenses to place the thing in a deliverable state
(CIVIL CODE, Art. 1521, par. 5).
How does an “as-is where-is” type of sale affect
the vendor’s obligation to deliver?
The phrase “as-is where-is” basis pertains solely to
the physical condition of the thing sold, not to its
legal situation, and therefore does not amount to a
waiver on the legal defects pertaining to the subject
matter (NDC v. Madrigal Wan Hai Lines Corp., G.R. price; such sale depends upon the discretion of the
No. 148332, September 30, 2003). buyer (CIVIL CODE, Art. 1502, par. 1).

It is merely descriptive of the state of the thing sold. Rules:

Thus, the “as-is where-is” basis merely describes the
actual state and location of the property sold. The
depiction does not alter the seller’s responsibility to
deliver the property to the buyer (Asset Privatization
Trust v. T.J. Enterprises, G.R. No. 167195, May 8,
2009).
SALE ON ACCEPTANCE, TRIAL,
APPROVAL, OR SATISFACTION
A contract is in the nature of an option to purchase if
the goods prove to be satisfactory, with the approval
of the buyer being a condition precedent; the sale is
dependent upon the quality of goods (CIVIL CODE,
Art. 1502, par. 2).
1. Title passes to the buyer upon delivery;
2. Buyer bears the risk of loss;
3. The option to purchase or return the goods rests
entirely on the buyer without reference to the
quality of the goods;
4. The buyer may revest the ownership in the seller
by returning or tendering the goods within the
time fixed in the contract or within a reasonable
time if no time is fixed; and
5. The buyer must comply with the express or
implied conditions attached to the privilege;
otherwise, the sale becomes absolute and
becomes liable for the price (DE LEON, supra at
236).

Rules: SALE OR RETURN AND SALE ON

1. Title remains in the seller, until the sale TRIAL, DISTINGUISHED
becomes absolute by: SALE OR RETURN SALE ON TRIAL
a. Buyer’s approval of the goods; or
b. Buyer’s failure to comply with the express or As to Condition Imposed
implied conditions of the contract as to
giving notice of dissatisfaction or as to Subject to a resolutory Subject to a suspensive
returning the goods; or condition. condition.
c. By his doing any other act adopting the
transaction (e.g., mortgaging the property or As to Option of the Buyer to Purchase
selling it to a third person).
Depends entirely on the Depends on the
will of the buyer. character of the goods.
2. Risk of loss remains with the seller, except
when the buyer is at fault or has agreed to bear As to Transfer of Ownership
the loss;
Ownership passes to Ownership remains in
3. Buyer must give the goods a trial, except where the buyer on delivery the seller until the buyer
it is evident that it cannot perform the work and subsequent return signifies his approval or
intended; reverts ownership to acceptance to the seller.
the seller.
4. Period within which buyer must signify
acceptance runs only when all parts essential for Ownership is revested There is no revesting of
the operation of the object have been delivered; in the seller if the buyer ownership because it is
so decides. retained by the seller
5. If it is stipulated that a third person must signify until the sale becomes
approval or satisfaction, the provision is valid, absolute.
but the third person must be in good faith. If
refusal to accept is not justified, the seller may As to Risk of Loss
still sue; and
Risk of loss or injury Risk of loss remains
6. Generally, the sale and delivery to a buyer who rests upon the buyer. with the seller.
is an expert on the object purchased is not a sale (Id. at 237-238)
on approval, trial, or satisfaction (DE LEON,
supra at 236-237). SALE BY DESCRIPTION
A sale where a seller sells a thing as being of a
SALE OR RETURN certain kind, the buyer merely relying on the seller’s
Property is sold but the buyer, who becomes the representations or descriptions (CIVIL CODE, Art.
owner of the property on delivery, has the option to 1481).
return the same to the seller instead of paying the
SALE BY SAMPLE
A sale where a small quantity of a commodity is
exhibited by the seller as a fair specimen of the bulk,
which is not present and as to which there is no
opportunity to inspect or examine (Mendoza v.
David, G.R. No. 147575, October 22, 2004). This is
intended to save the parties from the time and
expense of examining the whole quantity of the
goods being purchased (DE LEON, supra at 135).
Mere exhibition of the sample does not necessarily
make it a sale by sample. The exhibition must have
been the sole basis or inducement of the sale (DE
LEON, supra at 135).
Warranty: That the bulk of the commodity will
correspond in kind, quality, and character with the
sample exhibited examine (CIVIL CODE, Arts. 1481
and 1565).
Rights of the Buyer in a Sale by Sample:
1. Return the thing and recover the money paid; or
2. Retain the thing and sue for the breach of
warranty (5 PARAS, supra at 71).
SALE BY DESCRIPTION AND SAMPLE
Must satisfy the requirements in both, and not in only
one (Id.).
Two-Fold Warranty in Sale by Sample and
Description
1. That the goods purchased matched with the
description; and
2. That the goods matched in kind, quality and
character with the samples exhibited to the
buyer (CIVIL CODE, Art. 1481, par. 1).
NOTE: The buyer shall be given a reasonable
opportunity to compare the bulk of the goods with the
description made on the sample presented. If the
buyer has failed to notice the differences, the seller
is not excused from his warranties (CIVIL CODE,
Art. 1481, par. 2).
COMPLETENESS OF DELIVERY
1. Movables (CIVIL CODE, Art. 1522)
a. Where, in relation to what is contracted to
sell, the quantity of goods delivered is:
i. Less–
Buyer has two (2) options:
1.) Reject the goods; or
2.) Accept them
a.) When the acceptance is with
knowledge that the seller is not
going to perform the contract,
the buyer shall pay at contract
rate; or
b.) When knowledge is after the
acceptance and consummation
or disposal of the goods, the
buyer is not liable for more than
the fair value to him of the
goods delivered.
“Fair value to him” is the benefit
which the buyer may have received
from the goods. It is not necessarily
the market value. Since the
defaulting seller is the wrong doer,
the buyer is not required to pay
more than the contract price if such
price for the goods is more than fair
value to him of the goods (DE
LEON, supra at 287).
ii. Larger–
Buyer has three (3) options:
1.) Accept per contract and reject the
rest;
2.) Accept the whole and pay at the
contract rate; or
3.) If indivisible, reject the whole or
accept it entirely.
iii. Mixed with Goods of Different
Description–
Buyer has two (2) options:
1.) Accept the goods which are in
accordance with the contract and
reject the rest; or
2.) If indivisible, reject the goods
entirely or accept them entirely.
2. Immovables
a. Sold Per Unit or Number (CIVIL CODE,
Art. 1539-1540)–contains a statement of the
area at the rate of a certain price for a unit
or measure or number. Art. 1539-1540 of
the Civil Code shall also apply to judicial
sales (CIVIL CODE, Art. 1541).
Rules:
i. GENERAL RULE: If the vendee should
demand, the vendor must deliver all that
may have been stated in the contract.
ii. When the entire area cannot be
delivered–the object of the contract, its
cause as far as the vendee is
concerned, is not delivered. Hence is
entitled to rescind it.
iii. If what is delivered is:
1.) Less in area OR of inferior or
different quality
Buyer may seek Rescission, if:
a.) Lack in area is at least 1/10 of
the area agreed upon;
b.) The deficiency in quality
specified in the contract
exceeds 1/10 of the price
agreed upon;
 c.) The vendee would not have
bought the immovable had he
known of its smaller area or
inferior quality; and
d.) Proportional reduction of price
in case of fulfillment.
2.) Greater in area
The vendee may accept the area
included in the contract and reject
the rest. If he accepts the whole
area, he must pay at the contract
rate (CIVIL CODE, Art. 1540).
In a lump sum contract, a vendor is
generally obligated to deliver all the
land covered within the boundaries,
regardless of whether the real area
should be greater or smaller than
that recited in the deed. However, in
case there is conflict between the
area actually covered by the
boundaries and the estimated area
stated in the contract of sale, he/she
shall do so only when the excess or
deficiency between the former and
the latter is reasonable (Arcaina v.
Ingram, G.R. No. 196444, February
15, 2017).
The SC held that the difference of
5,800 sq. m. is too substantial to be
considered reasonable. The Court
noted that only 6,200 sq. m. was
agreed upon between petitioners
and Ingram. Declaring Ingram as
the owner of the whole 12,000 sq.
m. on the premise that this is the
actual area included in the
boundaries would be ordering the
delivery of almost twice the area
stated in the deeds of sale. Surely,
Article 1542 does not contemplate
such an unfair situation to befall a
vendor-that he/she would be
compelled to deliver double the
amount that he/she originally sold
without a corresponding increase in
price (Arcaina v. Ingram, G.R. No.
196444, February 15, 2017).
b. Sold for Lump Sum (CIVIL CODE, Art.
1542)
A cuerpo cierto / por precio alzado; when
two or more real estates are sold for a single
price, the rule is the same as when the real
estate is sold for a lump sum. There shall be
no increase or decrease in the area actually
delivered and the area stated in the contract
(Rudolf Lietz, Inc. v. Court of Appeals, G.R.
NO. 122463 December 19, 2005).
Rules:
i. There shall be no increase or decrease
of the price although there be a greater
or lesser area or number than that
stated in the contract, especially with
the use of qualifying words of “more or
less” in describing the area;
ii. The same rule applies when two or
more immovable are sold for a single
price;
iii. But if, besides mentioning the
boundaries which is indispensable in
every conveyance of real estate, its
area or number should be designated in
the contract, the vendor shall be bound
to deliver all that is included within said
boundaries, even when it exceeds the
area or number specified in the contract
(VILLANUEVA, supra at 227).
NOTE: The rule does not apply if the
deficiency is so material as to go to the
essence of the contract for under such
circumstances, gross mistake may be
inferred which is the duty of a court of equity
to correct (Asiain v. Jalandoni, G.R. No. L-
20435, October 23, 1923).
PRESCRIPTION OF ACTION
Action for rescission arising from Articles 1539 and
1542 shall prescribe in six (6) months counted from
the day of delivery of the thing to the vendee (CIVIL
CODE, Art. 1543).
NOTE: The Civil Code presumes that the purchaser
had in mind a particular piece of land and that he
ascertained its area and quality before the contract
of sale was perfected. If he did not do so, or if having
done so he made no objection and consented to the
transaction, he can blame no one but himself (Teran
v. Vda. de Riosa, G.R. No. L-34697, March 26,
1932).
Where the area of the immovable is stated in the
contract based on an estimate, the actual area
delivered may not measure up exactly with the area
stated in the contract. According to Article 1542 of
the Civil Code, in the sale of real estate made for a
lump sum, there shall be no increase or decrease of
the price, although there be a greater or lesser area
or number than that stated in the contract (Feliciano
Esguerra, et al. v. Virginia Trinidad, G.R. No.
169890, March 12, 2007).
The vendor is obligated to deliver all the land
included within the boundaries, regardless of
whether the real area should be greater or smaller
than that recited in the deed (Balantakbo v. CA. G.R.
No. 108515, October 16, 1995).

If the vendor cannot deliver to the vendee all that is
included within the boundaries mentioned in the
contract, the latter has the option to (1) reduce the
price in proportion to the deficiency or (2) to set aside
the contract (CIVIL CODE, Art. 1542, par. 2).
DOUBLE SALE (CIVIL CODE, ART. 1544)
Requisites: (VIOS)
1. Two or more transactions must constitute Valid
sales;
2. Two or more buyers who are at odds over the
rightful ownership of the subject matter must
each represent conflicting Interests;
3. They must pertain exactly to the same Object or
subject matter; and
4. They must be bought from the same or
immediate Seller (Vda. de Viray v. Sps. Usi,
G.R. No. 192486, November 21, 2012).
Article 1544 applies only to purchasers in good faith
and disqualifies any purchaser in bad faith (De Leon
v. Ong, G.R. No. 170405, February 2, 2010).
Art. 1544 does not apply when:
1. Not all the elements are present;
NOTE: The principle of prior tempore, potior jure
(he who is first in time is preferred in right)
should apply.
2. Where one of the sale is totally abhorrent and
repugnant to the Philippine Constitution and is
thus, void ab initio, it stands to reason that there
can be no double sale to speak of (Magnique-
Stone v. Cattleya Land, G. R. No. 195975,
September 5, 2016);
3. The two different contracts of sale are made by
two different persons, one of them not being the
owner of the property sold (Sps. Salera v. Sps.
Rodaje, G.R. No. 135900, August 11, 2007);
4. Sales involved were initiated not by just one
vendor but by several vendors, i.e., from one of
its co-owners and the other from all the co-
owners (Sps. Manlan v. Sps. Beltran, G.R. No.
222530, October 16, 2019);
5. Sales involving unregistered lands; Under Act
No. 3344, registration of documents affecting
unregistered land is “without prejudice to a third
party with a better right;
6. Mere registration of a sale in one’s favor does
not give him any right over the land if the vendor
was not anymore, the owner of the land, having
previously sold the same to somebody else,
even if earlier sale was unrecorded
(Radiowealth Finance Co. v. Palileo, G.R. No.
83432, May 20, 1991);
NOTE: The principle of prior tempore, potior jure
(he who is first in time is preferred in right)
should also apply.
7. The first sale occurs when land is not yet
registered and the second sale is done when the
land is already registered (Dagupan Trading Co.
v. Macam, G.R. No. L-18497, May 31, 1965);
NOTE: The principle of prior tempore, potior jure
(first in time, stronger in right) should also apply.
8. When the property was already registered under
the Torrens system, the first buyer’s registration
of the sale under Act No. 3344 is not effective for
purposes of Article 1544. Thus, the second
buyer prevails over the first if the second buyer
recorded the sale in good faith with the Register
of Deeds in accordance with P.D. No. 1529
(Sps. Abrego v. De Vera, G.R. No. 154409, June
21, 2004);
9. When the owner had previously sold his
property (and dominion already transferred) and
thereafter executed a second sale in favor of
another person, the latter cannot acquire any
right. At the time of the second sale, the vendor
had no more existing right over the property
which he could lawfully dispose of (Consolidated
Rural Bank (Cagayan Valley), Inc. v. CA, G.R.
No. 132161, January 17, 2005);
10. When the earlier transaction is a pacto de retro
sale of an unregistered land and the subsequent
conveyance is a donation of the land in favor of
another by the vendor a retro (Sps. De Guzman
v. CA, G.R. No. L-46935, December 21, 1987)
11. Where there is only one valid sale, the previous
sale having been found to be fraudulent (Fudot
v. Cattleya, Inc, G.R. No. 171008, September
13, 2007); if one sale is simulated and the other
is genuine (De Leon v. Caluag, G.R. No. L-
18722, September 14, 1967);
12. Where one sale is absolute and the other is a
pacto de retro sale and the period to redeem has
not yet expired (Teodosio v. Sabala, G.R. No. L-
11522, January 31, 1957);
13. Where one of the sales is subject to a
suspensive condition, which was not complied
with and the other is an absolute sale. The
reason being a conditional sale is not a sale
before the condition had been performed
(Mendoza v. Kalaw, G.R. No. L-16420, October
12, 1921);

14. Where one is a sale and the other is an
assignment of the right to repurchase the same
property (Dichoso v. Roxas, G.R. No. L-17441,
July 31, 1962);
15. Where one transaction is a sale and the other is
a mortgage (Mamuyac v. Abena, G.R. No. L-
45742, April 12, 1939); and
16. In a contact to sell, there being no previous sale
of property, a third person buying such property
despite the fulfillment of the suspensive
condition cannot be deemed a buyer in bad faith
and the prospective buyer cannot seek relief of
reconveyance of the property (Coronel v. CA,
G.R. No. 103577, October 7, 1996).
Rules on Preference (CIVIL CODE, ART. 1544):
1. Personal Property
– first possessor in good faith
2. Real Property
a. First registrant in good faith: second buyer
must register the document in good faith;
otherwise, he does not have a better right
(Fudot v. Cattleya Land Inc., G.R. No.
171008, September 13, 2007);
b. First possessor in good faith; or
c. Person with oldest title in good faith
(Martinez v. CA, G.R. No. 123547, May 21,
2001).
Applicability of the Rule of Caveat Emptor (Buyer
Beware)
One who purchases real property, which is in actual
possession of others, should make some inquiry
concerning the rights of those in possession
(Rosaroso v. Soria, G.R. No. 194846, June 19,
2013).
Purchaser in Good Faith
One who –
1. Buys the property without notice that some other
person has a right to, or interest in, such
property; and
2. Pays a full and fair price for the same at the time
of such purchase, or before he has notice of the
claim or interest of some other person in the
property (Agricultural and Home Extension Dev’t
Group v. CA, G.R. No. 92310, September 3,
1992).
Burden of Proof
He who asserts the status of a purchaser in good
faith and for value has the burden of proving such
assertion (Mathay v. CA, G.R. No. 115788.
September 17, 1998).
Lis Pendens (Suit Pending)
A buyer cannot be considered an innocent
purchaser for value where he ignored the notice of
lis pendens on the title when he bought the lot
(Limketkai Sons Milling, Inc. v. CA, G.R. No. 118509,
December 1, 1995).
First Buyer is Always in Good Faith
Indeed, knowledge gained by the first buyer of the
second sale cannot defeat the first buyer's rights
except only as provided by law, as in cases where
the second buyer first registers in good faith the
second sale ahead of the first. Such knowledge of
the first buyer does bar her from availing of her rights
under the law, among them, first her purchase as
against the second buyer (Spring Homes
Subdivision v. Sps. Tablada, G. R. No. 200009,
January 23, 2017).
If the second buyer in a sale of land registers the
sale after he has acquired knowledge that (1) there
was a previous sale of the same land to another, or
(2) that another person claims the same land, the
registration by the second buyer will not confer any
right upon him. The first vendee who took
possession of the land in good faith is preferred
(Berico v. CA, G.R. No. 96306, August 20, 1993).
Illustration: A sold his land to B for P500,000.
Before B could fully pay the price, A sold the land to
C and took possession of the land. B learned that the
sale between A and C is not yet registered. Thus, B
registered an adverse claim over the lot with the
register of deeds. Subsequently, the deed of sale in
favor of C was registered and a TCT was issued to
her but with annotation of the adverse claim. Who
has a better right over the land?
Answer: B, the first buyer. At the time of the first
sale, B was in good faith because the title was still in
the name of A. And B could not have been aware of
any sale involving the property. B’s good faith did not
cease after he learned of the subsequent sale
between A and C. The recording of the adverse
claim was done to protect B’s rights. Consequently,
the subsequent registration by C of the sale was
done in bad faith. Although at the time of the second
sale C was a buyer in good faith, his status as such
ceased after the prior sale was made known to him
(Carbonell v. CA, G.R. No. L-29972, January 26,
1976).
Note that in all the rules there must be good faith;
otherwise, the order of preference does not apply
(Romeo Paylago and Rosario Dinaandal v. Ines
Pastrana Jorabe and the Court of Appeals, L-20046,
Mar. 27, 1968).
Examination of Certificate of Title
GENERAL RULE: A buyer may rely on the Torrens
title of the seller. The buyer is not obligated to look
beyond the certificate to investigate the title of the
seller appearing on the face of the certificate (AFP
Mutual Benefit Association, Inc. v. CA, G.R. No.
104769, March 3, 2000).
EXCEPTION: When there exist important facts that
would create suspicion in a reasonable man to go
beyond the present title and to investigate those that
preceded it (Mercado v. Allied Banking Corp., G.R.
No. 171460, July 27, 2007).
Rule Governing Banks
The rule that persons dealing with registered lands
can rely solely on the certificate does not apply to
banks because their business is one affected with
public interest keeping in trust the money belonging
to their depositors (Sps. Sarmiento v. CA, G.R. No.
152627, September 16, 2005).
When the Subject of Sale is an Unregistered
Land
The rules in double sale under Article 1544 of the
Civil Code, whereby the buyer who is able to first
register the purchase in good faith is in full accord
with Section 51 of P.D. 1529 which provides that no
deed, mortgage, lease or other voluntary instrument,
except a will purporting to convey or affect registered
land shall take effect as a conveyance or bind the
land until its registration. Thus, if the sale is not
registered, it is binding only between the seller and
the buyer but it does not affect innocent third
persons (Sps. Abrigo v. De Vera, G.R. No. 154409,
June 21, 2004).
Illustration: A sold his land to B with the right to
repurchase the same. A failed to redeem the
property, thus B registered the land in his name.
Unknown to B, A obtained a free patent over the
land. The free patent was later on cancelled by a
TCT. Meanwhile, B sold the land to C. A also sold
the land to D who registered the sale and a TCT was
issued in her name. Who has a better right?
Answer: D. Both C and D registered the sale of the
property. Since C did not know that the property was
covered by Torrens System, he registered the sale
under Act 3344; while D registered the transaction
under the Torrens system, because during the sale,
A presented the TCT covering the property. It has
been held that registration must be done in the
proper registry in order to bind the land. Since
the property in dispute was already registered under
the Torrens System, C’s registration of the sale
under Act 3344 was not effective for purposes of Art.
1544 of the Civil Code. The priority in time principle
is not applicable in this case (Sps. Abrigo v. De Vera,
G.R. No. 154409, June 21, 2004)
Registration
Any entry made in the books of registry, including
both registration in its ordinary and strict sense, and
cancellation, annotation, and even marginal notes
(Cheng v. Genato, G.R. No. 129760, December 29,
1998).
It is the entry made in the registry which records
solemnly and permanently the right of ownership
and other real rights (DE LEON, supra at 342).
Registration Requires Actual Recording
If the property was never really registered as when
the registrar forgot to do so although he has been
handed the document, there is no registration.
Registration in its juridical aspect must be
understood as the entry made in a book or public
registry of deeds (Po Sun Tun v. Price, G.R. No. L-
31346, December 28, 1929).
Bad faith on the part of one buyer amounts to
registration in favor of the innocent buyer (DE LEON,
supra at 344).
A buyer of an unregistered land acquires a better title
than a subsequent buyer, even if the latter registered
the sale in good faith after the registration of the land
by the seller because the second buyer merely steps
into the shoes of the seller who at the time of the sale
to him is no longer the owner of the property
(Radiowealth Finance Co. v. Palileo, G.R. No.
83432, May 20, 1991).
Double Donation
Art. 1544 applies to a double donation. A deed of
donation executed with all the formalities of the law
is on the same footing as a deed of sale in the form
of a public instrument (Cagaoan v. Cagaoan, G.R.
No. 17900, June 21, 1922).
Donations of the same thing to two or more different
donees shall be governed by the provisions
concerning the sale of the same thing to two or more
different persons (CIVIL CODE, Art. 744)
Possession
Possession means both actual and constructive
(The Roman Catholic Church v. Pante, G.R. No.
174118, April 11, 2012).
Possession under Art. 1544 of the Civil Code is
either material or symbolic (Ten Forty Realty v. Cruz
G.R. No. 151212, September 10, 2003).
.
Good Faith Must Concur with Registration
To be entitled to priority, the second purchaser must
not only establish prior recording of his deed, but
must have acted in good faith. Therefore, the
requirement of the law is two-fold: (1) acquisition in
good faith and (2) registration in good faith (Gabriel
v. Sps. Mabanta, G.R. No. 142403, March 26, 2003).
Act of registration must be coupled with good faith-
that is registrant must have no knowledge of the
defect or lack of title of his vendor or must not have
been aware of facts which should have put him upon
such inquiry and investigation as might be necessary
to acquaint him with the defects in the title of his
vendor (Rosaroso v. Soria, G. R. No. 194846, June
19, 2013).
Duly Registered Attachment
It is a settled rule that an attachment, which is duly
registered, takes precedence over a prior
unregistered sale.
The preference created by the levy is not diminished
even by subsequent registration of the prior sale.
The reason is that an attachment is a proceeding in
rem. It is against the particular property and is
enforceable against the whole world (Valdevieso v.
Dalamerio, G.R. No. 133303, February 17, 2005).
DELIVERY OF FRUIT AND
ACCESSORIES (CIVIL CODE, Arts. 1164, 1166
and 1537)
ACCESSIONS
It is the fruits of a thing; or additions to, or
improvements upon, a thing (e.g. young of animals,
house or trees on a land, etc.) (DE LEON, supra at.
322). The term “fruits” here includes natural,
industrial and civil fruits (Binalbagan Estate v.
Gatuslao, G.R. No. 48560, February 26, 1943).
ACCESSORIES
Anything attached to a principal thing for its
completion, ornament, or better use (e.g., picture
frame, key of a house, etc.) (DE LEON, supra at
323).
The seller is bound to deliver accessions and
accessories in the condition in which they were upon
perfection of the contract (CIVIL CODE, Art. 1537).
This means that the seller has the duty to preserve
the thing and its accessions and accessories from
the moment of perfection of the contract of sale. If
anything happens to the thing before its delivery,
(e.g., loss or deterioration, improvement), the
seller’s rights and liabilities will be governed by the
rules in Art. 1189 of the Civil Code, the seller being
considered its debtor (CIVIL CODE, Art. 1538).
The buyer has a right to the fruits of the thing from
the time the obligation to deliver it arises. However,
he shall acquire no real right over it until the same
has been delivered to him (CIVIL CODE, Art. 1164).
The fruits (natural, industrial or civil) shall pertain to
the buyer from the day on which the contract was
perfected (CIVIL CODE, Art. 1537, par. 2).
The obligation to give a determinate thing includes
the delivery of all its accessions and accessories,
even though they may not have been mentioned
(CIVIL CODE, Art. 1166).
WHEN THE VENDEE IS NOT ENTITLED
TO THE FRUITS
1. By agreement of the parties;
2. When the vendee rescinds the contract of sale
instead of exacting the fulfillment thereof (CIVIL
CODE, Art. 1385); and
3. In a contract of promise to sell since the only
right of the contracting parties is to reciprocally
demand the fulfillment of the contract (DE
LEON, supra at 324).
CONDITION
An uncertain event or contingency upon the
happening of which the obligation or right of the
contract depends. In such case, the obligation of the
contract does not attach until the condition is
performed (DE LEON, supra at 374).
NOTE: There may be a contract of sale of goods,
whose acquisition by the seller depends upon a
contingency, which may or may not happen (CIVIL
CODE, Art. 1462, par. 2).
Effect of Non-Fulfillment of Condition
1. The other party may:
a. Refuse to proceed with the contract; or
b. Proceed with the contract, waiving the
performance of the condition.
2. If the condition is in the nature of a promise that
it should happen, the non-performance of such
condition may be treated by the other party as
breach of warranty (CIVIL CODE, Art. 1545, par.
1).
Article 1545 presupposes that there is a perfected
contract between the parties and that one of them
fails in the performance of an obligation under the
contract (Dev’t Bank of the Philippines v. Medrano,
G.R. No.167004, February 7, 2011).
Distinction Between Condition Imposed on
Perfection of Contract and Condition Imposed
on Performance of Obligation:
1. Condition imposed on perfection of contract
– Prevents the juridical relation from coming into
existence.

2. Condition imposed on performance of
obligation
– Gives the option to the party either to refuse
or proceed with the contract of sale and waive
the condition (Romero v. CA, G.R. No. 107207,
November 23, 1995).
A warranty is not necessarily written. It may be oral
as long as it is not given as a mere opinion or
judgment. Rather, it is a positive affirmation of a fact
that buyers rely upon, and that influences or
induces them to purchase the product (Philippine
Steel Coating Corp. v. Quinones, G.R. No. 194533,
April 19, 2017).

The vendor is bound to transfer the ownership of and

WARRANTY V. CONDITION deliver, as well as warrant the thing which is the
object of the sale (CIVIL CODE, Art. 1495).
WARRANTY CONDITION
While warranty is not an essential element of a sale,
As to the Obligation of the Parties there can be no warranty without a sale. If the sale
Goes into the Goes into the root of is illegal, the buyer cannot maintain an action on a
performance of such the existence of the warranty accompanying it (Id. at 378).
obligation and in fact obligation.
may constitute an The decisive test is whether the seller assumes to
obligation in itself. assert a fact of which the buyer is ignorant
(Goodyear Philippines Inc. v. Sy, G.R. No. 154554,
As to Existence on Contract November 9, 2005).

May form part of the
obligation or contract by
provision of the law
without the parties
having agreed thereto.
Must be stipulated by NOTE: The buyer may make warranties as well, as
the parties in order to when he warrants that he will pay or when he makes
form part of an any affirmation or promise to induce the seller to
obligation. enter into the contract of sale (DE LEON, supra at
379).

In Relation to Subject Matter of Contract Time of Warranty

Under Article 1546, the affirmation must induce the
Whether express or May attach itself either buyer to purchase the good and the buyer purchases
implied, relates to the to the obligation of the the thing relying on the affirmation. If the warranty is
subject matter itself or to seller or of the buyer to given after the contract of sale has been perfected,
the obligations of the deliver possession and the warranty must generally, in order to be effective,
seller as to the subject transfer ownership be accompanied by a new and separate
matter of the sale. over the subject matter consideration (Id. at 380-381).
of the sale.
Intention to Make a Warranty
Effect of Non-Fulfillment It is the natural tendency of the affirmation of
promise to induce the buyer to purchase that is
Non-fulfillment of a Although it may
warranty would extinguish the important, and not the intention of the seller to
constitute a breach of obligation upon which it warrant, and in the absence of an intention to
warrant is of no consequence (Id. at 381).
contract. is based, it generally
does not amount to a
Warranty is a collateral undertaking
breach of the contract
Since an assignee merely steps into the shoes, so
of sale.
to speak, of an assignor, the assignee shall likewise
(VILLANUEVA, supra at 454). shoulder all the obligations of a vendor-assignor,
including the vendor's warranty. As a collateral
WARRANTY undertaking, it follows where the principal obligation
A warranty is a statement or representation made by goes (Koa v. CA, G.R. No. 84847, March 5, 1993).
the seller of goods - contemporaneously and as part
of the contract of sale - that has reference to the A warranty is a collateral undertaking in a sale of
character, quality or title of the goods; and is issued either real or personal property, express or implied;
to promise or undertake to insure that certain facts that if the property sold does not possess certain
are or shall be as the seller represents them incidents or qualities, the purchaser may either
(Philippine Steel Coating Corp. v. Quinones, G.R. consider the sale void or claim damages for breach
No. 194533, April 19, 2017). of warranty. An express warranty pertains to any
affirmation of fact or any promise by the seller
relating to the thing, the natural tendency of which is
to induce the buyer to purchase the same. An
implied warranty is one which the law derives by
application or inference from the nature of
transaction or the relative situation or circumstances
of the parties, irrespective of any intention of the
seller to create it (Pilipinas Makro, Inc. v. Coco
Charcoal Philippines, Inc., G.R. No. 196419,
October 4, 2017).
KINDS OF WARRANTY:
1. Express
– It is any affirmation of fact or promise by the
seller relating to the thing, inducing the buyer to
purchase the same and if the buyer purchases
the thing relying thereon (CIVIL CODE, Art.
1546).
Requisites: (AIR)
a. It must be an Affirmation of fact or any
promise by the seller relating to the subject
matter of the sale;
b. The natural tendency of such affirmation or
promise is to Induce the buyer to purchase
the thing; and
c. The buyer purchases the thing Relying on
such affirmation or promise (Philippine Steel
Coating Corp. v. Quinones, G.R. No.
194533, April 19, 2017).
The breach of an express warranty makes the
seller liable for damages (VILLANUEVA, supra
at 455).
The usual exaggerations in trade, when the
other party had an opportunity to know the facts,
are not in themselves fraudulent (CIVIL CODE,
Art. 1340).
Dealer’s or Trader’s Talk
Dealer’s talk like “excellent,” cannot be
considered as an express warranty (PARAS,
supra at 208). The law allows considerable
latitude to seller’s statement or dealer’s talk
(Tankeh v. Dev’t Bank of the Philippines, G.R.
No. 171428, November 11, 2013).
A mere expression of opinion, no matter how
positively asserted, does not import a warranty,
unless the seller is an expert and his opinion
was relied upon by the buyer (CIVIL CODE, Art.
1341).
Misrepresentation made in good faith is not
fraudulent but may constitute error (CIVIL
CODE, Art. 1343).
2. Implied
– It is that which the law derives by implication
or inference from the nature of the transaction or
the relative situation or circumstances of the
parties, irrespective of any intention of the seller
to create it (Ang v. CA, G.R. No. 177874,
September 29, 2008).
The principle of implied warranties is an
exception to the rule of caveat emptor (DE
LEON, supra at 387).
NATURE OF IMPLIED WARRANTY
It is a natural element of a contract, deemed
incorporated in the contract of sale (Id.).
It may be waived or modified by express
stipulation (e.g. warranty against eviction,
warranty against hidden defects) (Id.).
Although only a seller is bound by implied
warranties of law, nevertheless, an agent of the
seller may bind himself to such warranties, by
express contractual stipulation (Schmid and
Oberly Inc. v. RJL Martinez Fishing Corporation,
G.R. No. 75198, October. 18, 1988).
Illustrations:
a. Warranty that the seller has a right to sell;
b. Warranty against eviction;
c. Warranty against non-apparent burden or
servitudes;
d. Warranty against hidden defects or
unknown encumbrance (CIVIL CODE. Art.
1561);
e. Warranty against redhibitory defects on
animals;
f. Warranties as to fitness or merchantable
quality (CIVIL CODE, Art. 1562);
g. Warranties for consumer goods (R.A. 7394,
Art. 68).
WHEN IMPLIED WARRANTY NOT
APPLICABLE:
1. As is and where is Sale
– The vendor makes no warranty as to the
quality or workable condition of the goods and
the vendee takes them in the conditions in which
they are found and from the place they are
located (DE LEON, supra at 387).
NOTE: It does not extend to liens or
encumbrances unknown to the vendee and could
not be disclosed by a principal examination of the
goods sold (Id.).
2. Sale of Second Hand Articles
– There is no implied warranty as to the
condition, adaptation, fitness or suitability or the
quality of an article sold as a second-hand
article. Such articles might be sold under such
circumstances as to raise an implied warranty. A
certification issued by a vendor that a second-
 hand machine was in A-1 condition is an express
warranty binding on the vendor (Moles v. IAC,
G.R. No. 73913, January 31, 1989).
3. Sale by Virtue of Authority in Suit or Law
– Not applicable to a sheriff, auctioneer,
mortgagee and other person who sells by virtue
of authority in fact or law (the principle applicable
to execution sales is caveat emptor because the
purchaser acquires no better title than the
judgment debtor has) (Allure Manufacturing Inc.,
v. CA, G.R. No. 94452, July 16, 1991).
NOTE: The persons enumerated are, however,
liable for actual representations, fraud or negligence
in the exercise of their duties (DE LEON, supra at
389).
WARRANTY THAT SELLER HAS A
RIGHT TO SELL
Although Art. 1547 uses the phrase “unless a
contrary intention appears”, there can be no legal
waiver of such warranty without changing the basic
nature of the relationship, for the warranty on the
part of the seller that he has the capacity to sell, i.e.
to transfer ownership of the thing is the essence of
sale, unless it amounts to clear assumption of risk
on the part of the buyer (VILLANUEVA, supra at
497).
WARRANTY AGAINST EVICTION
The seller guarantees that he has the right to sell the
thing sold and to transfer ownership to the buyer,
who shall not be disturbed in his legal and peaceful
possession thereof (CIVIL CODE, Art. 1548).
ELEMENTS: DJ-PIS-NO
1. Vendee is Deprived, in whole or in part, of
the thing purchased;
2. Deprivation is by virtue of a final Judgment;
The warranty cannot be enforced until a final
judgment has been rendered, whereby the
vendee loses the thing acquired or a part thereof
(CIVIL CODE, Art. 1557).
NOTE: The term final judgment in article 1548
refers to “final and executory judgment”
(Perez v. Zulueta, G.R. No. L-10374, September
30, 1959).
Eviction may take place by virtue of a final
judgment of an administrative office or board. It
is not necessary that a court makes final
judgment, provided it was rendered by a
competent authority and in conformity with the
procedure prescribed by law (Bonzon v.
Standard Oil Co. of New York, G.R. No. L-
10297, March 11, 1916).
3. Judgment is based on a right Prior to the
sale or an act Imputable to the vendor;
4. Vendor was Summoned in the suit for
eviction at the instance of the vendee:
a. To enable the seller to prove his claim;
b. To avoid multiplicity of suits; and
c. To satisfy due process.
The vendor shall not be obliged to make good
the proper warranty, unless he is summoned in
the suit for eviction at the instance of the vendee
(CIVIL CODE, Art. 1558).
REASON: In order to give the vendor an
opportunity to intervene and defend the title that
he has transferred, for, after all, he alone would
know the circumstances or reasons behind the
claim of the plaintiff and be in a position to
defend the validity of his title (De la Riva v.
Escobar, G.R. No. 27300, December 17, 1927).
The defendant vendee shall ask, within the time
fixed in the Rules of Court for answering the
complaint, that the vendor be made a co-
defendant (CIVIL CODE, Art. 1559).
Eviction Suit
It refers to a case where the vendee is the
defendant in a suit instituted to deprive him of
the thing purchased (DE LEON, supra at 406).
5. No waiver of warranty by the vendee (Id. at
391).
The vendor’s liability for warranty against
eviction in a contract of sale is generally
waivable and may be renounced by the vendee
(Andaya v. Manansala, G.R. No. L-14714, Apr.
30, 1960).
In the absence of any of these essential
requisites, breach of warranty of eviction cannot
be declared (DE LEON, supra at 391).
The disturbance referred to in the case of
eviction is a disturbance in law which requires
that a person go to courts of justice claiming the
thing sold, or part thereof, and invoking reasons
(Id. at 392).
NOTE: Mere trespass in fact does not give rise
to the application of the doctrine of eviction
(CIVIL CODE, Art. 1590). In such case, the
vendee has a direct action against the
trespasser in the same way as the lessee has
such right (CIVIL CODE, Art. 1664).
Rules that Govern Eviction Suit:
1. No appeal is needed nor for buyer to resist
eviction for right to accrue; it is enough that the
aforementioned requisites are complied with
(CIVIL CODE, Art. 1549).
2. Applies to judicial sale; judgment debtor
responsible for eviction unless otherwise
decreed in judgment (CIVIL CODE, Art. 1552).
3. Vendor not liable for eviction if adverse
possession had been commenced before sale
but prescriptive period is completed after
transfer (CIVIL CODE, Art. 1550).
4. If the property is sold for nonpayment of taxes
due and not made known to the vendee before
the sale, vendor is liable for eviction (CIVIL
CODE, Art. 1551).
5. Rescission is not a remedy in case of eviction
because rescission contemplates that the one
demanding it is able to return whatever he has
received under the contract. Since the vendee
can no longer restore the subject-matter of the
sale to the vendor, rescission cannot be carried
out (CIVIL CODE, Art. 1385).
6. The suit for the breach can be directed only
against the immediate seller, unless the sellers
of the seller had promised to warrant in favor of
later buyers or the immediate seller has
expressly assigned to the buyer his own right to
sure his own seller (De la Riva v. Viuda de
Limjap, G.R. No. 27300, December 17, 1927).
7. The disturbance referred to in the case of
eviction is a disturbance in law which requires
that a person go to courts of justice claiming the
thing sold, or part thereof and invoking reasons.
8. Mere trespass in fact shall not authorize the
suspension of the payment of the price (CIVIL
CODE, Art. 1590).
9. Vendor’s liability is waivable but any stipulation
exempting the vendor from the obligation to
answer for eviction shall be void if he acted in
bad faith (CIVIL CODE, Art. 1553).
Where Warranty Against Eviction is Not
Applicable
1. The sale of an inheritance, in which the seller
shall only be answerable for his character as an
heir, but not ownership of all the things that
supposedly comprise the inheritance (CIVIL
CODE, Art. 1630); or
2. The sale for a lump sum of the whole of certain
rights, rent, or products, in which case the
vendor is not obliged to warrant each of the
various parts of which it may be composed,
except in a case of eviction from the whole or
part of greater value of the thing sold (CIVIL
CODE, Art. 1631).
Vendor’s Liability is Waivable
GENERAL RULE: The obligation of the vendor to
warrant against eviction is not an essential element
of contract of sale and may therefore, be increased,
diminished, or suppressed by agreement of the
parties (CIVIL CODE, Art. 1548, par. 3).
EXCEPTION: The waiver is contrary to law, public
order, public policy, morals, or good customs, or
prejudicial to a third person with a right recognized
by law (CIVIL CODE, Art. 6).
Vendor's Liability
In case of Total Eviction (CIVIL CODE, Art. 1555),
the vendor’s liability shall consist of: (VICED)
1. Value of the thing at the time of eviction;
All kinds of improvements whether useful or
necessary or even recreational expenses
voluntarily incurred by the vendee or caused by
the nature or time, insofar as they may affect the
value of the property, are taken into account in
determining the value of the property (Sta.
Romana v. Imperio, G.R. No. l-170280,
December 29 , 1965).
NOTE: Article 1555 does not speak of payment
of interest on the purchase price. The law had
intended that the interest on the price shall be
set off against the fruits received by the vendee
from the thing while in his possession (DE
LEON, supra at 398.)
2. Income or fruits, only if so decreed by the court;
NOTE: To the vendee belongs the use, free of
any liability, of the subject matter of sale (Id. at
399).
3. Costs of the suit (RULES OF COURT, Rule 142,
Sec. 1);
NOTE: It does not include travelling expenses
incurred by the vendee in defending himself in
an action (Orense v. Jaucian, G.R. No. L-5619,
March 11, 1919).
It does not also apply to a situation where the
judgment is in favor of the vendor except if the
vendor acted with fault or negligence (CIVIL
CODE, Arts. 1170 and 2176).
4. Expenses of the contract; and
GENERAL RULE: The expenses in execution
and registration of the sale are borne by the
vendor (CIVIL CODE, Art. 1487).
EXCEPTION: If the vendee should have paid for
such expenses, he shall have the right to
demand from the vendor (DE LEON, supra at
399).
5. Damages and interests and ornamental
expenses, if the sale was in bad faith.
NOTE: The vendee is not entitled to recover
damages if the vendor acted in good faith (Id. at
399).
The interest contemplated in Article 1555(5)
refers to interest on costs other than the
purchase price (e.g., cost of suit and expenses
of the contract) (Id. at 400).
In case of Partial Eviction, vendee may (CIVIL
CODE, Art. 1556):
1. Enforce vendor’s liability for eviction (VICED); or
2. Demand rescission of the contract.
The choices are available in the following instances:
1. When the vendee is deprived of a part of the
thing sold if such part is of such importance to
the whole that he would not have bought the
thing without said part (CIVIL CODE, Art. 1556,
par. 1); or
2. When two (2) or more things are jointly sold,
whether for a lump sum or for a separate price
for each, and the vendee would not have
purchased one without the other (CIVIL CODE,
Art. 1556, par. 2).
In applying Article 1556, the intention of the
vendee should be determined as of the
perfection of the sale. In this regard, under
Article 1371, in order to judge the intention of the
contracting parties, their contemporaneous and
subsequent acts shall be principally observed
(DE LEON, supra at 402).
Vendee Has No Duty to Appeal from the
Judgment
Appeal is not needed, and the buyer need not resist
eviction for the right against the vendor to accrue. It
is enough that the requisites are complied with
(CIVIL CODE, Art. 1549).
The requirement of final judgment does not also
mean that the parties have taken all the remedies.
Thus, the final judgment may be based on a
compromise agreement among the parties (DE
LEON, supra at 394).
Effect of Prescription
When an adverse possession had been commenced
before the sale but the prescriptive period is
completed after the transfer, the vendor shall not be
liable for eviction (CIVIL CODE, Art. 1550).
Basis: The vendee could easily interrupt the running
of the prescriptive period by bringing the necessary
action (DE LEON, supra at 394).
When the prescription has commenced to run
against the vendor and was completed before the
sale, the vendee can enforce the warranty against
eviction (Id. at 394).
Basis: The deprivation is based on a right prior to
the sale and an act imputable to the vendor.
NOTE: Article 1550 will have no application if the
property sold is a land registered under the Torrens
System. Under the latter, ownership of the land is not
subject to prescription (Id. at 394).
Liability of Judgment Debtor
The judgment debtor is also responsible for eviction
in judicial sales, unless it is otherwise decreed in the
judgment (CIVIL CODE, Art. 1552).
Basis: Principle of law that a person may not enrich
himself at the expense of another (DE LEON, supra
at 395).
Deprivation for Non-Payment of Taxes
If the property is sold for non-payment of taxes due
and not made known to the vendee before the sale,
the vendor is liable for eviction (CIVIL CODE, Art.
1551).
Vendee must act in good faith. He must not have
knowledge of the non-payment of taxes at the time
of the sale (DE LEON, supra at 395).
Inapplicability of Rescission
Rescission is not a remedy in case of eviction
because rescission contemplates that the one
demanding it is able to return whatever he has
received under the contract. Since the vendee can
no longer restore the subject matter of the sale to the
vendor, rescission cannot be carried out (CIVIL
CODE, Art. 1385).
EXCEPTION: The buyer may demand rescission in
case of partial eviction, because there still remains a
portion of the thing sold (DE LEON, supra at 403).
The suit for the breach can be directed only against
the immediate seller, unless the sellers of the seller
had promised to warrant in favor of later buyers or
the immediate seller has expressly assigned to the
buyer his own right to sue his own seller (Id. at 401).
Waiver of Liability
Vendor’s liability is waivable, but any stipulation
exempting the vendor from the obligation to answer
for eviction shall be void, if he acted in bad faith
(CIVIL CODE, Art. 1553).
Effect of Vendee’s Bad Faith
He cannot claim that the vendor has warranted his
legal and peaceful possession of the property sold
on the theory that he proceeded with the sale with
the assumption of the danger of eviction (J.M.
Tuason & Co., Inc. v. CA, G.R. No. L-41233,
November 21, 1979).
Kinds Of Waiver of Eviction (CIVIL CODE, Art.
1554)
1. Consciente / Simple
– The waiver is voluntarily made by the vendee
without the knowledge and assumption of the
risks of eviction. The vendor shall pay only the
value which the thing sold had at the time of
eviction.
2. Intencionada / Calificada
– The waiver is made by the vendee with
knowledge of the risks of eviction and
assumption of its consequences, in which case
vendor is not liable provided he did not act in bad
faith (CIVIL CODE, Art. 1554).
NOTE: Every waiver is presumed to be consciente.
To consider it intencionada, it must be accompanied
by some circumstance, which reveals the vendee’s
knowledge of the risks of eviction and his intention
to submit to such consequences (El Banco Nacional
Filipino v. Silo, G.R. No. L-47920, April 30, 1941).
Formal Summons to Vendor Essential
The vendor shall not be obliged to make good the
proper warranty, unless he is summoned in the suit
for eviction at the instance of the vendee (CIVIL
CODE, Art. 1558).
The phrase “unless he is summoned in the suit for
eviction” means that the vendor should be made a
party to the suit either by way of asking that the
former be made a co-defendant (CIVIL CODE Art.
1559), or by the filing of a third-party complaint
against said vendor (DE LEON, supra at 404).
In the absence of such opportunity, the vendor is not
bound to his warranty (Escaler v. CA, G.R. No. L-
42636, August 1, 1985).
WARRANTY AGAINST NON-APPARENT
BURDEN OR SERVITUDES (CIVIL CODE,
Art. 1560)
Requisites:
1. Immovable sold is encumbered with non–
apparent burden or servitude not mentioned in
the agreement; and
2. Nature of non–apparent servitude or burden is
such that it must be presumed that the buyer
would not have acquired it had he been aware
thereof.
Lack of knowledge on part of the vendor is not a
defense. The contract can still be invalidated on the
ground of mistake (CIVIL CODE, Arts. 1331, 1556 &
1566).
NOTE: Servitude (or easement) is an encumbrance
imposed upon an immovable for the benefit of
another immovable belonging to a different owner
(CIVIL CODE, Art. 613).
Remedy of the Buyer in Case of Breach:
1. Rescission; or
2. Indemnity (CIVIL CODE, Art. 1560).
When warranty not applicable: (ARAK)
1. Servitude is Apparent;
2. Non-apparent burden or servitude is Recorded
in the Registry of Property, except when there
is express warranty that the thing is free from all
burdens and encumbrances;
3. The servitude is mentioned in the Agreement;
4. Vendee had Knowledge of servitude (DE LEON,
supra at 408).
Prescriptive Period (Rescission)
The period is one (1) year, computed from the
execution of the deed (CIVIL CODE, Art. 1560, par.
2).
If the period has already elapsed, the vendee may
only bring an action for damages within one (1) year
from the date of the discovery of the non-apparent
burden or servitude (CIVIL CODE, Art. 1560, pars. 2
and 3).
WARRANTY AGAINST HIDDEN
DEFECTS
Seller guarantees that the thing sold is free from any
hidden faults or defects or any charge or
encumbrance not declared or known to the buyer
(CIVIL CODE, Art. 1561).
Hidden faults or defects pertain only to those that
make the object unfit for the use for which it was
intended at the time of the sale (Investments & Dev’t
Inc. v. CA, G.R. No. L-51377, June 27, 1988).
This warranty in sales is applicable in lease (Yap
Kim Chuan v. Tiaoqui, G.R. No. 10006, September
18, 1915).
NOTE: The provisions governing warranty
contained in the Title on Sales, shall be applicable to
the contract of lease (CIVIL CODE, Art. 1653).
Redhibition
The avoidance of a sale on account of some vice or
defect in the thing sold, which renders its use
impossible, or so inconvenient and imperfect that it
must be supposed that the buyer would not have
purchased it had he known of the vice (DE LEON,
supra at 409).
Redhibitory Action
An action instituted to avoid a sale on account of
some vice or defect in the thing sold (Id.).
Redhibitory Vice or Defect
A defect in the article sold against which defect the
seller is bound to warrant (Id.).
Elements: (SHEN-PW)
1. Defect is Serious or important such that:
a. The hidden defect should render the subject
matter unfit for the use for which it is
intended; or
b. The hidden defect should diminish the
thing’s fitness such that the buyer would
not have acquired it or would have given
a lower price for it had he been aware of the
defect (Id. at 410; CIVIL CODE, Art. 1561).
An imperfection or defect of little consequence
does not come within the category of being
redhibitory. It must be serious (Id. at 410).
2. Defect is Hidden
Hidden – Not known or could not have been
known to the vendee (Supercars Management
and Development Corp. v. The Late Filemon
Flores G.R. No. 148173, December 10, 2004);
Hidden to the eyes and cannot be discovered by
ordinary careful inspection. Hence, there is no
warranty if the defect is patent or visible (Id. At
411)
3. Exists at the time of the sale;
4. Vendee must give Notice of the defect to the
vendor within a reasonable time (CIVIL CODE,
Art. 1586);
5. Remedies must be brought within the Period of
six (6) months from delivery of the thing or forty
(40) days from date of delivery in case of
animals (CIVIL CODE, Arts. 1571 & 1577); and
6. No Waiver of the warranty on the part of the
vendee (CIVIL CODE, Art. 1548, par. 3).
Vendor is NOT Liable for:
1. Patent Defects
a. Defect, which the buyer must have
observed; or
b. Defect, which is not obvious, but the seller
tells the buyer, or which the buyer knows or
should have known (CIVIL CODE, Art.
1561).
2. Those that are not visible but the buyer is an
expert who, by reason of his profession, should
have known them (CIVIL CODE, Art. 1561).
Defect at the time of Sale
The vendor cannot be held liable for defects suffered
by the thing sold after the perfection of the sale. The
vendee must prove that the defect existed at the time
of the sale visible (DE LEON, supra at 413).
Knowledge of Vendor, Not Important
(Applicability of Doctrine of Caveat Venditor or
Vendor Beware)
GENERAL RULE: Seller is liable even though he is
unaware of the hidden defect (CIVIL CODE, Art.
1566, par. 1).
EXCEPTION: When there is a stipulation to the
contrary and the seller is not aware of it (CIVIL
CODE, Art. 1566, par. 2).
NOTE: Good faith cannot be availed of as a defense
by the vendor (DE LEON, supra at 421).
REASON: A sound price warrants a sound article
(McCullough v. Aenlle & Co., G.R. No. 1300,
February 3, 1904).
NOTE: If the vendee is aware of the defect in the
thing he buys or the lack of title in the vendor, he is
deemed to have willfully and voluntarily assumed the
risk attendant to the sale (Martinez v. CA, G.R. No.
L-31271, April 29, 1974).
Obligation of Seller in Case of Loss of the Thing
Sold on Account of Hidden Defects (CIVIL CODE,
Art. 1568)
If there was no waiver of warranty and the thing was
lost due to hidden defects:
1. When seller is aware of the hidden defects:
(L-PED)
a. Bear the Loss;
b. Return the Price;
c. Refund the Expenses of the contract; and
d. Pay Damages.
2. When seller is not aware of the hidden defects:
(L-PIE)
a. Bear the Loss;
b. Return the Price;
c. Return the Interest; and
d. Reimburse Expenses of the contract if paid
by the vendee.
If there was a waiver of warranty (CIVIL CODE, Art.
1566, par. 2):
1. When the seller is aware of the hidden defects,
the waiver is in bad faith; as a corollary, seller is
still liable.
2. When the seller is not aware of the hidden
defects and if the contrary has been stipulated,
the seller is not liable.
Effect of Loss of Defective Thing Sold
If the thing sold had any hidden fault at the time of
the sale and should thereafter be lost through a
fortuitous event or through the fault of the buyer,
the buyer may demand of the seller the price paid
less the value of the thing at the time of loss (CIVIL
CODE, Art. 1569).
The difference between the price paid for the thing
and the value at the time of the loss represents
damage suffered by the vendee. It is also the
amount by which the vendor has enriched himself; in
other words, the vendor is still made liable on his
warranty (DE LEON, supra at 425).
Illustration: A purchased a television from B at
P250,000 which was paid in full. The television has
hidden defects, the repair of which will cost P50,000.
The television, however, was lost through fortuitous
event. At the time of the loss the television is worth
P200,000. B is liable to refund to A the sum of
P50,000.
If it is the vendee who caused the loss of the thing,
the vendor is still liable by virtue of the existence of
the defects in the thing. He will be liable for P50,000
the amount needed for the repairs of the thing had it
not been lost.
Alternative Remedies of the Buyer to Enforce
Warranty (CIVIL CODE, Art. 1567)
Buyer may choose between the following:
1. Accion Redhibitoria (Redhibitory Action)
– The buyer withdraws from the contract.
2. Accion Quanti Minoris
– Proportionate reduction of the price.
NOTE: In case of a breach of an implied
warranty against hidden defects, the buyer may
either elect between withdrawing from the
contract and demanding a proportionate
reduction of the price, with damages in either
case (Sps. Batalla v. Prudential Bank, G. R. No.
200676, March 25, 2019).
The choice of remedies (accion quanti minoris
or accion redhibitoria) is available to the buyer
only when the thing has not been lost
(VILLANUEVA, supra at 464).
The same right is given to the buyer in the sale
of animals with redhibitory defects (CIVIL CODE,
Art. 1580).
The buyer must present proof that he suffered
damages as a result of the breach of the seller’s
warranty to be entitled to actual damages (De
Vera, Jr. v. CA, G.R. No. 132869, October 18,
2001).
Applicability to Judicial Sale
The warranty is applicable to judicial sales;
however, the judgment debtor is not liable for
damages for the reason that he is merely compelled
to sell his property (CIVIL CODE, Art. 1570).
Prescriptive Period
Six (6) months from the delivery of the thing sold
(CIVIL CODE, Art. 1571).
The prescriptive period of six (6) months is only
applicable to implied warranties. For express
warranties, the prescriptive period of four (4) years
shall apply (DE LEON, Sales, supra at 427) unless
another period is specified in the express warranty
(Isidro v. Nissan Motor PHL., Inc., G.R. No.136500,
December 3, 1999).
WARRANTY AGAINST REDHIBITORY
DEFECTS ON ANIMALS
Instances where there is Redhibitory Defect: (EVA)
1. Expert knowledge is not sufficient to discover it
(CIVIL CODE, Art. 1576, par. 1); or
2. The Veterinarian failed to discover or disclose it
through ignorance or bad faith (CIVIL CODE,
Art. 1576, par. 2); or
3. The Animal dies within three (3) days after its
purchase and the disease which caused the
death existed at the time of the contract (CIVIL
CODE, Art. 1578).
NOTE: The claim of the buyer must be based on
a finding of an expert that the disease causing
the death existed at the time of the contract (DE
LEON, supra at 432).
If the death occurs after three (3) days from
purchase or the defect is patent or visible, the
seller is not liable. If the loss is caused by a
fortuitous event or by the fault of the vendee, and
the animal has vices, Article 1569 should be
applied (Id.).
Sale of Animals at Fairs or at Public Auctions or
as Condemned
There is no warranty against hidden defect of
animals sold at fairs or at public auctions, or of
livestock sold as condemned (CIVIL CODE, Art.
1574).
Basis: It is assumed that the defects must have
been clearly known to the buyer (DE LEON, Sales,
supra at 429).
Public auctions may either be judicial or extrajudicial.
The law does not distinguish (Id.).
Sale of a Team (CIVIL CODE, Art. 1572)
GENERAL RULE: The defect of one will only give
rise to its redhibition and not of the others.

EXCEPTION: When the buyer would not have
purchased the sound animal/s without the defective
one.
The exception is presumed when what is bought is
a team, yoke, pair or set (even if separate price has
been fixed for each one of the animals composing
the same).
Remedy
1. Accion Redhibitoria; or
2. Accion Quanti Minoris (CIVIL CODE, Art. 1580).
Sale of Two or More Things Together (CIVIL
CODE, Art. 1573).
Article 1572, with respect to the sale of animals, shall
in like manner be applicable to the sale of other
things.
When Sale of Animals Void
1. Sale of animals with contagious diseases.
2. Sale of unfit animals, i.e. the use or service for
which the animals are acquired has been stated
in the contract and they are found to be unfit
therefor (CIVIL CODE, Art. 1575).
Obligation of Buyer to Return
In case of rescission, the animal shall be returned in
the condition in which it was sold and delivered, the
vendee being answerable for any injury due to his
negligence, and not arising from the redhibitory fault
or defect (CIVIL CODE, Art. 1579).
Prescriptive Period
Forty (40) days from the date of delivery to the buyer
(CIVIL CODE, Art. 1577).
The prescriptive period shall apply only with respect
to faults and defects, which are determined by law
or by local customs (CIVIL CODE, Art. 1577, par. 2).
WARRANTIES IN SALE OF GOODS /
WARRANTIES OF QUALITY (CIVIL CODE,
Art. 1562)
Quality of goods
It includes their state or condition (CIVIL CODE, Art.
1636, par. 1).
PURPOSE: To promote high standard in business
and to discourage sharp dealings. They are based
on the principle that “honesty is the best policy” (DE
LEON, supra at 414).
1. Warranty of Fitness
The seller guarantees that the thing sold is
reasonably fit for the known particular purpose
for which it was acquired by the buyer. It exists
in the following instances:
a. Where the buyer, expressly or by
implication, manifests to the seller the
particular purpose for which the goods are
acquired; and
b. Where the buyer relies upon the seller’s skill
or judgment (CIVIL CODE, Art. 1562 par. 1).
2. Warranty of Merchantability
The seller guarantees, where the goods were
bought by description, that they are reasonably
fit for the general purpose for which they are
sold.
It requires identity between what is described in
the contract and what is tendered, in the sense
that the latter is of such quality and value (CIVIL
CODE, Art. 1562 par. 2).
The requirement of merchantable quality carries
with it no implication that the goods shall be
saleable in a particular market (DE LEON, supra
at 416).
NOTE: Article 1562 which applies to goods
bought by description and refers to an implied
warranty that the goods are of “merchantable
quality.” Article 1565 which applies to goods
bought by sample and refers to an implied
warranty that the goods shall be free from any
defect rendering them “unmerchantable”.
Causes of unmerchantability
Goods may be unmerchantable not because of
a physical defect but because of some other
circumstances (e.g. infringement of trademark,
use of them is dangerous) (DE LEON, supra at
417).
Manufacturer or seller of animal feeds
cannot be held liable for any damage
allegedly caused by the product in the
absence of proof that the product was
defective
It is incumbent on petitioners to establish liability
on the basis of breach of implied warranty. The
manufacturer or seller of animal feeds cannot be
held liable for any damage allegedly caused by
the product in the absence of proof that the
product was defective. The defect of the product
requires evidence that there was no tampering
with, or changing of the animal feeds. The Court
explained that "in the sale of animal feeds, there
is an implied warranty that it is reasonably fit and
suitable to be used for the purpose which both
parties contemplated." (Padilla v. Universal
Robina Corporation, G.R. No. 214805,
December 14, 2017).
SALE UNDER A PATENT OR TRADE
NAME
There is no warranty as to its fitness for any
particular purpose, unless there is a stipulation to the
contrary (CIVIL CODE, Art. 1563).
BASIS: By exactly defining what he wants, the buyer
has exercised his own judgment instead of relying
upon that of the seller (DE LEON, supra at 418).
EFFECT OF USAGE OF TRADE
An implied warranty or condition as to the quality or
fitness for a particular purpose may be annexed by
the usage of trade (CIVIL CODE, Art. 1564).
A usage in order to bind both parties:
1. It must be known both; or
2. If unknown to one, the other must be justified in
assuming knowledge on the part of the person
with whom he is dealing (DE LEON, supra at
419).
MERCHANTABILITY OF GOODS BY
SAMPLE
In the case of a contract of sale by sample, if the
seller is a dealer in goods of that kind, there is an
implied warranty that the goods shall be free from
any defect rendering them unmerchantable which
would not be apparent on reasonable examination of
the sample (CIVIL CODE, Art. 1565).
FORM OF SALE OF LARGE CATTLE
Governed by special laws (i.e. P.D. No. 533 or The
Anti-Cattle Rustling Law) (CIVIL CODE, Art. 1581).
PRESERVATION OF THE THING
PENDING DELIVERY
The seller is bound to take care of the thing with the
diligence of a good father of a family (CIVIL CODE,
Art. 1163).
OBLIGATIONS OF THE
VENDEE
PRINCIPAL OBLIGATIONS (CIVIL CODE,
ART. 1582)
OBLIGATIONS OF THE VENDEE:
1. To accept delivery of the thing sold;
2. To pay the price of the thing sold in legal tender
unless another mode has been agreed upon at
the time and place stipulated in the contract; and
3. To bear the expenses for the execution and
registration of the sale and putting the goods in
a deliverable state, if such is the stipulation (DE
LEON, supra at 435).
GRACE PERIOD TO VENDEE
A grace period granted the vendee in case of failure
to pay the amount/s due is a right, not an obligation.
The grace period must not be likened to an
obligation, the nonpayment of which, under Article
1169 of the Civil Code, would still generally require
judicial or extra-judicial demand before default can
be said to arise (Optimum Development Bank v.
Sps. Jovellanos, G.R. No. 189145, December 04,
2013).
RULES:
1. In a contract of sale, the vendor is not required
to deliver the thing sold until the price is paid, nor
the vendee to pay the price before the thing is
delivered in the absence of an agreement in the
contract (CIVIL CODE, Art. 1524);
2. If stipulated, the vendee is bound to accept
delivery and to pay the price at the time and
place designated;
3. If there is no stipulation as to the time and place
of payment and delivery, the vendee is bound to
pay at the time and place of delivery;
4. In the absence of a stipulation as to the place of
delivery it shall be made wherever the thing
might be at the moment the contract was
perfected (CIVIL CODE, Art. 1251);
5. If only the time for delivery of the thing sold has
been fixed in the contract, the vendee is required
to pay even before the thing is delivered to him.
If only the time for payment of the price has been
fixed, the vendee is entitled to delivery even
before the price is paid by him (CIVIL CODE, Art.
1524; DE LEON, supra at 437).
LIABILITY OF VENDEE FOR
OBLIGATIONS OF COMPANY BOUGHT
OUT
1. Obligation not of considerable amount or
value
– The vendee may be said to assume the
obligations of the company bought out (e.g.
when incurred in the ordinary course of trade
and when the business of the latter company is
continued).
2. Obligation of considerable amount or value
– The vendee cannot be said to assume all the
obligations of the rival company (e.g. when the
company was bought to stop its operations in
order to eliminate competition) (PH Airlines v.
Balinquit, G.R. No. L-8715, June 30, 1956).
3. Monetary liabilities to selling company’s
employees
GENERAL RULE: Unenforceable against the
transferee of an enterprise (e.g. labor contracts like
Collective Bargaining Agreement (CBA)).
REASON: Labor contracts are in personae and
binding only between the parties (Barayoga v. Asset
Privatization Trust, G.R. No. 160073, October 24,
2005).
EXCEPTION: Unless expressly assumed, or the
sale or transfer was made in bad faith (Barayoga v.
Asset Privatization Trust, G.R. No. 160073, October
24, 2005).
OTHER OBLIGATIONS:
1. To take care of the goods without the obligation
to return, where the goods are delivered to the
buyer and he rightfully refuses to accept it. It is
sufficient that the buyer notifies the seller that he
refuses to accept them (CIVIL CODE, Art.
1587).
If the seller refuses to take delivery of the goods
after being notified to do so by the buyer, the
latter may resell the goods (DE LEON, supra at
453).
The buyer in such a case is in the position of a
bailee who has had goods entrusted upon him
without his assent. He has the obligation to take
reasonable care of the goods but nothing more
can be demanded of him (Id.).
The goods in the buyer’s possession are at the
seller’s risk (Id.).
2. To be liable as a depositary if he voluntarily
constituted himself as such (CIVIL CODE, Art.
1587).
a. To pay interest for the period between
delivery of the thing and the payment of the
price in the following cases (CIVIL CODE,
Art. 1589): (IFV)
i. Interest is stipulated;
It is the rate stipulated which governs;
otherwise, the legal rate of interest shall
be due (DE LEON, supra at 455).
NOTE: Interest which must be in writing
refers only to contracts of loan (CIVIL
CODE, Art. 1956).
ii. Fruits or income are received by the
vendee from the thing sold (DE LEON,
supra at 455);
This applies even if a term has been
fixed for the payment of price (Id. at
455).
iii. Vendee is guilty of default (Id. at 455).
Under Art. 1169 of the Civil Code, the
debtor incurs delay from the time of
judicial or extra-judicial demand for
payment of the price. However, demand
is not necessary to constitute delay in
the following cases: (LTD)
1.) The Law or obligation expressly
provides;
2.) Time is of the essence; or
3.) Demand would be useless as when
the obligor has rendered it beyond
his power to perform.
PARTIAL PAYMENT
Article 1589 applies to a situation where the seller
delivers the thing to the buyer, who makes partial
payment of the purchase price (DE LEON, supra at
456).
NOTE: Article 1589 (3) will not apply if the seller files
and action to nullify the contract of sale (Id.).
Acceptance, Not a Bar to Action for Damages or
Other Legal Remedy (CIVIL CODE, Art. 1586).
ACCEPTANCE
Acceptance is the assent to become the owner of
specific goods when delivery of them is offered to the
buyer (DE LEON, supra at 451).
Acceptance and delivery are different and separate
acts. Acceptance is the buyer’s obligation while
delivery is the vendor’s obligation (DE LEON, supra
at 368).
Acceptance is not a condition to complete delivery.
Vendee has nothing to do with the vendor’s delivery.
The seller must comply with his obligation to deliver
although there is no acceptance yet by the buyer (La
Fuerza Inc., v. CA, G.R. No. L-24069, June 28,
1968).
GENERAL RULE: Unless otherwise agreed upon,
acceptance of the goods (CIVIL CODE, 1587) by the
buyer does not discharge the seller from liability for
damages or other legal remedy (like rescission) in
breach of any promise (CIVIL CODE, Art. 1586) or
warranty in the contract of sale (CIVIL CODE, Art.
1547).
EXCEPTION: If the buyer, after acceptance of the
goods, fails to give notice to the seller of the breach
in any promise or warranty within a reasonable time
after the buyer knows or ought to know of such
breach.
PURPOSE: To protect the seller against belated
claims (DE LEON, supra at 452).
RIGHTS OF THE BUYER:
1. Not bound to accept delivery of goods by
installments (CIVIL CODE, Art. 1583);
However, where the contract provides for the
delivery of goods by installments and a separate
price has been agreed upon for each
installment, it depends on each case of the
terms of the contract and the circumstances of
the case whether the breach is severable or not
(DE LEON, supra at 440).
Where Breach Affects the Whole Contract
If the seller makes defective, partial or
incomplete deliveries or the buyer wrongfully
neglects or refuses to accept delivery or fails to
pay installment, the injured party may sue for
damages for breach of the entire contract if the
breach is so material, that is, breach of one
installment prevents the performance of the
contract, as to affect the contract as a whole (Id.
at 441).
Where the Breach is Severable
It will merely give rise to a claim for
compensation for the particular breach but not a
right to treat the whole contract as broken (Id.)
2. GENERAL RULE: Reasonable opportunity to
examine the goods upon delivery to ascertain
whether they are in conformity with the contract
before accepting the same (CIVIL CODE,
Art.1584).
EXCEPTIONS:
a. There is a stipulation to the contrary (CIVIL
CODE, Art. 1584).
b. In case of C.O.D. (collect on delivery) –
buyer is not entitled to examine until
payment is made; except if:
i. There is an agreement permitting
examination; or
ii. The usage of trade permits the
examination (CIVIL CODE, Art. 1523,
par. 3).
The right of examination is not absolute. The
seller is bound to afford the buyer a reasonable
opportunity of examining goods only on
“request” (CIVIL CODE, Art. 1584, par. 2).
If the seller refused to allow inspection, the buyer
may rescind the contract (DE LEON, supra at
444).
3. Reject delivery of a wrong quantity of goods or
of goods of a different description not included
in the contract, which are mixed with the goods
sold (CIVIL CODE, Art.1522).
4. If he refuses to accept the goods, having the
right to do so, he is not bound to return them to
the seller; it being sufficient that he notifies the
seller of his refusal to accept (CIVIL CODE,
Art.1522).
NOTE: As to registered and titled land, the buyer
has no obligation to inquire beyond four corners
of title Rule applies only when:
a. Sale is the registered owner of the land;
b. Owner of the land is in possession thereof;
and
c. Buyer was not aware at the time of the sale
of any claim or interest of some other person
in the property or of any defect or restriction
in the title of the seller (EEG Development
Corporation v. Heirs of De Castro, G. R. No.
219694, June 26, 2019).
If he voluntarily constitutes himself as depositary of
the goods, he shall be liable as such (CIVIL CODE,
Art.1587).
Effect of Refusal to Accept Goods Without Just
Cause
Title to the goods passes to the buyer from the
moment they are placed at his disposal, except if
ownership has been reserved by the seller (CIVIL
CODE, Art.1588).
Acceptance and Actual Receipt
Acceptance and actual receipt do not imply each
other.
ACCEPTANCE V. ACTUAL RECEIPT
ACCEPTANCE ACTUAL RECEIPT
Implies approval of the Refers only to the
contract (e.g. where the physical act of taking or
goods are selected by receiving the goods
the buyer). With the sold.
delivery and transfer of
title postponed until a
later time.
(DE LEON, supra at 448).
Acceptance by the buyer may precede actual
delivery; there may be actual receipt without
acceptance and there may be acceptance without
receipt (DE LEON, supra at 451).
Modes of Manifesting Acceptance (CIVIL CODE,
Art. 1585):
1. Express Acceptance
– When the buyer, after delivery of the goods,
intimates to the seller, verbally osr in writing, that
he has accepted them.
2. Implied Acceptance
a. When buyer, after delivery of goods,
performs acts of ownership
b. Failure to return goods after reasonable
lapse of time (DE LEON, supra at 448).
USE OF PROPERTY
GENERAL RULE: An act inconsistent with the
seller’s ownership prevents the buyer from claiming
that he has not accepted the goods.
Example:
1. Resale or mortgage of the goods;
2. Alteration in a manner proper only for an owner;
or
3. Sells or attempts to sell the goods (Id.).
EXCEPTION:
If such use does not affect the condition or value of
the property (e.g. where the use is for the purpose of
trial) (Id. at 449).
EXCEPTION TO THE EXCEPTION:
If the buyer prolongs the trial beyond a reasonable
period, or uses more of the goods than is fairly and
reasonably necessary in making the tests (Id.).
NOTE: The buyer must notify the seller within a
reasonable time after the buyer knows or ought to
know of the breach; otherwise, the seller will be
released from such liability (CIVIL CODE, Art. 1586).
Notice is still required even if the seller has
knowledge of the facts constituting the breach
because whether or not the defect constitute a
breach must be taken from the point of view of the
buyer (5 TOLENTINO, Civil Code of the Philippines
Annotated, p. 134 [hereinafter, 5 TOLENTINO]).
DELIVERY V. ACCEPTANCE
DELIVERY ACCEPTANCE
As to Nature
An act of the vendor. An act of the vendee.
As to Obligation
One of the obligations of Acceptance is an
the vendor is the obligation on the part of
delivery of the thing sold
(CIVIL CODE, Art. the vendee (CIVIL
1495). CODE, Art. 1582).
PAYMENT
Non-payment does not prove simulation; at most, it
gives the seller the right to sue for collection.
Payment of the price is a resolutory condition and
the remedy of the seller is to exact fulfillment or, in
case of substantial breach, to rescind the contract
under Art. 1191 of the Civil Code (DE LEON, supra
at 71).
REMEDIES FOR
BREACH OF CONTRACT
RESCISSION IN CASE OF BREACH OF A
PARTY OR IN CASE OF LESION
1. Rescission based on Art. 1191
a. Legal basis is substantial breach;
b. Principal remedy, retaliatory versus unjust
party;
c. Effect is mutual restitution.
2. Rescission based on Art. 1381
a. Legal basis is lesion (rescissible contract);
b. Subsidiary remedy - cannot be instituted
except when other remedies are exhausted;
c. Effect is mutual restitution.
REMEDIES OF THE BUYER
WHEN THE SUBJECT MATTER OF THE
CONTRACT OF SALE IS IMMOVABLE
PROPERTY
1. Suspension of payment (CIVIL CODE, Art.
1590);
It contemplates a situation where the contract is
not yet consummated (DE LEON, supra at 457).
It is applicable in the following cases (grounds to
invoke suspension of payment):
a. Where the vendee is disturbed in
possession or ownership of the thing
bought; or
b. Vendee has reasonable ground to fear that
his possession or ownership would be
disturbed (by a vindicatory action or a
foreclosure of mortgage).
In both instances, the vendee may retain only
the price that has not been paid to the vendor.
 He is not entitled to recover what has already
been paid (DE LEON, supra at 457).
Under the second case, it is not necessary that
an action be brought against the vendee (Id.).
Exceptions to Suspension of Payment
(where vendee has no right to suspend
payment): (SSCTP)
a. Vendor gives Security for the return of the
price in a proper case (CIVIL CODE, Art.
1590);
b. Stipulation that vendee must make payment
notwithstanding such contingency (CIVIL
CODE, Art. 1590);
c. Cessation of disturbance or danger (Bareng
v. CA, G.R. No. L-12973, April 25, 1960);
d. Disturbance is a mere act of Trespass (DE
LEON, supra at 457); or
e. Vendee has Paid the price in full (Id.).
NOTE: When the disturbance is caused by non-
apparent servitude, the remedy is rescission, not
suspension of payment (CIVIL CODE, Art.
1560).
Length of Suspension of Payment
The right to suspend payment granted by law to
the vendee exists only while the danger or
disturbance lasts. Once the vendor has caused
the cessation of this disturbance such as by
compromising with the third person who poses
the danger or disturbance to the vendee’s
possession or ownership, the vendee must
already pay (Bareng v. CA, G.R. No. L-12973,
April 25, 1960).
Mere Act of Trespass
A mere act of trespass shall not authorize the
suspension of the payment of the price (CIVIL
CODE, Art. 1590).
2. In the sale of immovable property, to pay even
after the expiration of the period agreed upon,
as long as no demand for rescission of the
contract has been made upon him either
judicially or by a notarial act, even though it may
have been stipulated that rescission shall of right
take place upon failure to pay the price at the
time agreed upon (CIVIL CODE, Art.1592).
The defaulting vendee may defeat the vendor’s
right to rescind the contract of sale if he pays the
amount due before he receives a demand for
rescission, either judicially or by a notarial act,
from the vendor (Heirs of Pangan v. Sps.
Perreras, G.R. No. 157374, August 27, 2009).
New Term
GENERAL RULE: Once a demand for
rescission by suit or notarial act is made, the
court may not grant the vendee a new term
(CIVIL CODE, Art.1592).
EXCEPTION: In the interest of justice and
equity, where the vendee has substantially
performed in good faith (J.M. Tuazon & Co. v.
Javier, G.R. No. L-28569, February 27, 1970).
Art. 1592 is not applicable in the following
cases:
a. Sale of installment on real estate – It does
not apply to a sale on installment of real
property when the parties have laid down
the procedure to be followed in the event
that the vendee failed to fulfill his obligation
(Albea v. Inquimboy, G.R. No. L-1601, May
29, 1950).
b. Contract to sell/conditional sale of real
estate – In this case, the title remains with
the vendor until full payment of the purchase
price (Roque v. Lapuz, G.R. No. L-32811,
March 31, 1980). Payment in this case is a
positive suspensive condition, the failure of
which prevents the obligation of the vendor
to convey title. In an absolute sale, non-
payment is a resolutory condition
(Pangilinan v. CA, G.R. No. 83588,
September. 29, 1997).
Cases covered by the Realty Installment Buyer
Act, also known as the Maceda Law (R.A. 6552).
NOTE: Article 1191 is subordinated to the
provisions of Article 1592 when applied to sales
of immovable property (DE LEON, supra at
459).
The mere failure to fulfill the contract does not
operate ipso facto as its rescission (DE LEON,
supra at 459).
A judicial or notarial act is necessary before a
valid rescission can take place; whether or not
automatic rescission has been stipulated
(Iringan v. CA, G.R. No. 129107, September 26,
2001).
A complaint by the vendor seeking the
cancellation of the vendee’s adverse claim on
the vendor’s original certificate of title and for the
refund of the payments made cannot be
considered a judicial demand under Article
1592. Seeking discharge from contractual
obligations and an offer for restitution is not the
same as abrogation of the contract (Ocampo v.
CA, G.R. No. 97442, June 30, 1994).

NOTE: In Articles 1191 and 1592, the rescission
is a principal action which seeks the resolution
or cancellation of the contract, while Article
1381, the action is a subsidiary one limited to
cases of rescission for lesion as enumerated in
said article (DE LEON, supra at 461).
3. In case of Subdivision or Condominium
Projects (P.D. 957, The Subdivision and
Condominium Buyer’s Protective Decree).
Non-forfeiture of Payments
No installment payments made by the buyer in a
subdivision or condominium project for the lot or
unit he contracts to buy shall be forfeited in favor
of the owner or developer when the buyer, after
due notice to the owner or developer desists
from further payment due to the failure of the
owner or developer to develop the subdivision or
condominium project according to the approved
plans and within the time limit for complying with
the same (P.D. 957, Section 23).
4. Rights provided for under Maceda Law
(see Maceda Law section).
WHEN THE SUBJECT MATTER OF THE
CONTRACT OF SALE IS A MOVABLE
PROPERTY
a. In case of failure of seller to deliver, the buyer
may seek action for specific performance,
without giving the seller the option of retaining
the goods on payment of damages (CIVIL
CODE, Art. 1598).
REASON: Damages are imposed by law to
insure fulfillment of contract and not substitute
for it (DE LEON, supra at 479).
b. The judgment may be unconditional, or upon
such terms and conditions as to damages,
payment of the price and otherwise, as the court
may deem just (CIVIL CODE, Art. 1598).
This article applies only where the goods to be
delivered are specific or ascertained (CIVIL
CODE, Art. 1598).
c. In case of breach of seller’s warranty, the buyer
may, at his election, avail of the following
remedies: (RADaR)
i. Recoupment – Accept or keep the goods
and set up the seller’s breach to reduce or
extinguish the price (CIVIL CODE, Art. 1599,
par. 1);
Theory of Recoupment
The seller’s damages are cut down to an
amount which will compensate him for the
value of what he has given (DE LEON, supra
at 482).
Remedy of recoupment must be
exercised in relation to the same
transaction: Recoupment must arise out of
the contract or transaction upon which the
plaintiff’s claim is founded. To be entitled to
recoupment, the claim must arise from the
same transaction. That there was a series of
purchases made by petitioners could not be
considered as a single transaction (First
United Constructors Corporation v.
Bayanihan Automotive Corporation, G.R.
No. 164985, January 15, 2014).
ii. Accept the goods and maintain an action for
damages for breach of warranty (CIVIL
CODE, Art. 1599, par. 1 (2));
iii. Action or counterclaim for Damages –
Refuse to accept the goods and maintain an
action for damages for breach of warranty
(CIVIL CODE, Art. 1599, par. 3); or
Note: Acceptance with knowledge if the
breach of warranty does preclude rescission
but it does not necessarily preclude a right
to recoupment or damages (DE LEON,
supra at 483).
iv. Rescission – Rescind the contract and
refuse to receive the goods; or if goods have
already been received, return them or offer
to return them and recover what was paid or
any part of it concurrently with return or
immediately after it (CIVIL CODE, Art. 1599,
par. 4).
These are alternative remedies, without
prejudice to paragraph 2 of Article 1191 of
the Civil Code (a party may still seek
rescission after choosing specific
performance if the latter is impossible)
(CIVIL CODE, Art. 1599, par. 4 (2)).
NOTE: Article 1599 applies both to implied
warranties and to express warranties,
whether of quality of or of title (DE LEON,
supra at 481).
Article 1599 does not apply if the contract of
sale was not perfected (Insular Life
Company Ltd. v. Young, G.R. No.140964,
January 16, 2002).
 When Rescission by Buyer Not Allowed:
1.) If the buyer accepted the goods SALE BY DESCRIPTION AND BY
knowing the breach of warranty without SAMPLE
protest;
2.) If he fails to notify the seller within a The goods must satisfy all the warranties
reasonable time of his election to appropriate to either kind of sale (DE LEON, supra
rescind; or at 136).
3.) If he fails to return or offer to return the
goods in substantially as good BUYER’S RIGHT TO SPECIFIC
condition as they were in at the time of PERFORMANCE
the transfer of ownership to him. But In case the seller should violate his obligation to
where the injury to the goods as caused make delivery, the buyer as a matter of right can
by the very defect against which the demand specific performance upon application to
seller warranted, the buyer may still the court (CIVIL CODE, Art. 1598).
rescind the sale (CIVIL CODE, Art.
1599, par. 4(3)). The seller cannot retain the goods on payment of
damages (Id.).
Rights and Obligations of Buyer in REASON: Payment of damages is not a substitute
Case of Rescission: for specific performance. It is imposed by law to
1.) Buyer shall cease to be liable for the insure fulfillment of the contract (DE LEON, supra at
price, his only obligation being to 479).
return the goods (CIVIL CODE, Art.
1599, par. 4 (4)); The judgment or decree by the court may be
2.) If he has paid the price or any part unconditional, or upon such terms and conditions as
thereof, he may recover it from the to damages, payment of the price and otherwise, as
seller (CIVIL CODE, Art. 1599, par. 4 the court may deem just (CIVIL CODE, Art. 1598).
(4));
3.) He has the right to hold the goods as COMPARATIVE TABLE OF REMEDIES
bailee for the seller should the latter
refuse to accept the offer of the buyer
IN CASE OF BREACH
to return the goods (CIVIL CODE, Art. Vendor/Seller Vendee/Buyer
1599, par. 4 (5)); and
4.) He has a right to have a lien on the Rescission based on Rescission based on
goods for any portion of the price substantial breach substantial breach
already paid which such lien may be (CIVIL CODE, Art. (CIVIL CODE, Art.
enforced as if he were an unpaid 1191). 1191).
seller (CIVIL CODE, Art. 1599, par. 4
(5)). Action for damages Action for damages
(CIVIL CODE, Art. (CIVIL CODE, Art.
d. In case of sale of goods by sample or by 1170). 1170).
description, the buyer may demand rescission:
Immovables
i. In a contract of sample or description, if the
bulk of the goods do not correspond to the 1. Rescission based on 1. Suspension of
sample or description; or Anticipatory Breach payment (CIVIL
ii. In sale by description and sample, if the (CIVIL CODE, Art. CODE, Art. 1590);
bulk of the goods do not correspond with 1591); 2. Right to grace period
the sample and description (CIVIL CODE, 2. Rescission based on under the Maceda
Art. 1481). a stipulation Law.
regarding automatic
SALE BY DESCRIPTION rescission (CIVIL
Purchaser has not seen the article sold and relies on CODE, Art. 1592);
the description given to him by the vendor, or has 3. Maceda Law.
seen the goods but the want of identity is not
apparent on inspection (DE LEON, supra at 135). Movables

1. Action for the price 1. Action for specific

SALE BY SAMPLE of the goods/specific performance in case of
It must appear that the parties contracted solely with performance (CIVIL specific or ascertained
reference to the sample, with the understanding that CODE, Art. 1595); goods (CIVIL CODE,
the bulk was like it (DE LEON, supra at 135). Art. 1598);

Vendor/Seller Vendee/Buyer
2. Technical 2. In case of breach of
Rescission (CIVIL warranty of seller (CIVIL
CODE, Art. 1597); CODE, Art. 1599).
3. Rescission based on
a stipulation
regarding automatic
rescission (CIVIL
CODE, Art. 1593);
4. Remedies of unpaid
seller (CIVIL CODE,
Art. 1526).
REMEDIES OF THE SELLER
WHEN THE SUBJECT MATTER OF THE
SALE IS IMMOVABLE
1. When there is anticipatory breach
Seller may sue for rescission if the following
concur:
a. There is delivery of immovable property;
b. Vendee has not yet paid the price; and
c. Vendor has reasonable ground to fear the:
i. Loss of the immovable property; and
ii. Loss of price (CIVIL CODE, Art. 1591).
This contemplates a situation where there has
been delivery of the immovable property, but the
vendee has not yet paid the price (DE LEON,
supra at 458).
This is applicable to both cash sales and to sales
in installments as Art. 1591 of the Civil Code
does not distinguish between one and the other
(Id. at 459).
Pursuant to Art. 1191 of the Civil Code, the
vendor may sue for either fulfillment or
rescission with damages in either case upon the
vendee’s failure to comply with his obligation to
pay the agreed price (Id.).
Rescission of a contract would not be permitted
for a slight or casual breach but only for such
substantial or fundamental breach that would
defeat the very object of the parties (Id.).
2. When there is failure on the part of buyer
to pay the price
Automatic rescission of sale of immovable
property is stipulated (CIVIL CODE, Art.
1592).
a. Vendor is given an option to rescind upon
JUDICIAL OR NOTARIAL demand;
b. When there is no judicial or notarial demand,
vendee may still pay. Offer to pay is
sufficient to defeat vendor’s prerogative.
Vendor’s right to rescind is not absolute;
c. Art. 1191(3) of the Civil Code provides that
the court may grant vendee a new term.
However, if there is already a demand, the
court may no longer fix a term.
Applicability of Art. 1592
It applies only to a contract of sale of real
property where title passes to the vendee upon
the delivery of the thing sold usually effected
through the execution of public document. It
does not apply to conditional sale where the title
remains with the vendor until full payment of the
price (Valarao v. CA, G.R. No. 130347. March 3,
1999).
Meaning of “even though”
According to Justice Paras and Dean
Villanueva, the phrase “even though” signifies
that Article 1592 of the Civil Code is applicable
to all sales of immovable even when there is no
stipulation on automatic rescission (5 PARAS,
supra at 244; VILLANUEVA, supra at 394).
According to De Leon, however, the phrase
“even though” emphasizes that when no
stipulation is found on automatic rescission, the
judicial or notarial requirement still applies.
According to him, therefore, the buyer may still
pay the price even after the expiration of the
period and notwithstanding a stipulation on
automatic rescission, as long as there is no
demand by judicial or notarial act (DE LEON,
supra at 460).
Prescriptive Period (rescission under Articles
1191 and 1592)
It must be brought within ten (10) years from the time
the right of action accrues (CIVIL CODE, Art. 1144).
Seller is given an option to demand rescission upon
judicial or notarial demand (CIVIL CODE, Art. 1592).
NOTE: An action for reconveyance is not an action
for rescission. The judicial rescission of a contract
gives rise to mutual restitution which does not
happen in an action for reconveyance (Olympia
Housing Inc. v. Panasiatic Travel Corp., G.R. No.
140468, January 16, 2003).
However, when there is no judicial or notarial
demand, the buyer may still pay. Offer to pay is
sufficient to defeat seller’s prerogative (DE LEON,
supra at 460).
The right of automatic rescission, which is
stipulated in a contract of sale, is subject to waiver.
In this case, the right was held waived by the vendor
who granted many extensions to the vendee, in all
of which, the vendor never called attention to the
proviso on “automatic rescission” (Pilipinas Bank v.
IAC, G.R. No. L-67881, June 30, 1987).
WHEN THE SUBJECT MATTER OF THE
SALE IS MOVABLE
1. Movables in general
Automatic rescission shall take place in the
interest of the seller if the buyer without any valid
cause, upon the expiration of the period for
delivery of thing:
a. Should not have appeared to receive it; or
b. Having appeared, should not have tendered
the price at the time, unless a longer period
is stipulated for its payment (CIVIL CODE,
Art. 1593).
Reason behind Art. 1593: The delay is
prejudicial to the vendor since personal
properties are not capable of maintaining a
stable price in the market (DE LEON, supra at
468).
It applies only when thing sold has not been
delivered to the buyer.
REASON: The buyer cannot take the law in his
hands (Id.).
2. Sale of Goods
Provisions Governing Breach of Contract of
Sale of Goods (CIVIL CODE, Art. 1594)
Governed particularly by the provisions of
Chapter 6 (CIVIL CODE, Arts. 1595-1599), and
secondarily, by the other provisions of the Title
on sales so far as said provisions can apply (DE
LEON, supra at 470).
“Goods” include all chattels personal but not
things in action or money of legal tender in the
Philippines. The term includes growing fruits or
crops (CIVIL CODE, Art. 1636, par. 1).
Actions available
In general, the actions available for breach of
the contract of sale of goods are the following:
1. Payment of the price (CIVIL CODE, Art.
1595);
2. Damages for non-acceptance of the goods
(CIVIL CODE, Art. 1596);
3. Rescission of the contract for breach thereof
(CIVIL CODE, Art. 1597);
4. Specific Performance (CIVIL CODE, Art.
1598); and
5. Rescission or damages for breach of
warranty (CIVIL CODE, Art. 1599).
a. Seller’s Right of Action for the Price
(CIVIL CODE, Art. 1595)
i. When the ownership of the goods has
passed to the buyer and he wrongfully
neglects or refuses to pay for the goods
according to the terms of the contract,
the seller may maintain an action
against him for the price of goods (CIVIL
CODE, Art. 1595, par. 1).
When price is payable on a certain day,
irrespective of delivery or transfer of
title, and the buyer wrongfully neglects
or refuses to pay, the seller may
maintain an action for the price although
the ownership in the goods has not
passed (CIVIL CODE, Art. 1595, par. 2)
.
However, it is a defense to such action
that seller has manifested an inability to
perform the contract of sale on his part
or an intention not to perform it at any
time before the judgment (CIVIL CODE,
Art. 1595, par. 2).
Reason: A contract of sale
contemplates a double exchange.
There is justice as well as good reason
for excusing the buyer from prior
performance when he will not get
subsequent performance from the seller
(DE LEON, supra at 473).
ii. If goods cannot readily be resold for a
reasonable price, although transfer of
ownership has not passed, and if the
provisions of Article 1596 par. 4, are not
applicable – seller may offer to deliver
the goods to the buyer (CIVIL CODE,
Art. 1595, par. 3).
iii. If buyer refuses to receive, seller may
notify the buyer that he holds the goods
as bailee for the buyer. Thereafter, the
seller may treat the goods as the buyer’s
and may maintain an action for the price
(CIVIL CODE, Art. 1595, par. 3).
b. Seller’s Right of Action for Damages
i. When the buyer wrongfully neglects or
refuses to accept and pay for the goods
(CIVIL CODE, Art. 1596, par. 1);
ii. In an executory contract, where the
ownership in the goods has not passed,
and the seller cannot maintain an action
to recover the price (CIVIL CODE, Art.
1595, par. 4); or
iii. If the goods are not yet identified at the
time of the contract or subsequently, the
seller’s right is necessarily confined to
an action for damages (DE LEON,
supra at 475).
 Measure of Damages
Estimated loss directly and naturally
resulting in the ordinary course of events
from the buyer’s breach (CIVIL CODE, Art.
1596, par. 2).
Measure of Damages (when there is
available market)
In the absence of special circumstances
showing proximate damage of a different
amount, the difference between the contract
price and the market or current price at the
time the goods ought to have been
accepted, or at the time of refusal to accept
when there is no time fixed (CIVIL CODE,
Art. 1596, par. 3). This follows the general
rule that damages comprehend not only the
actual loss suffered but also unrealized
profit (CIVIL CODE, Art 2200) (DE LEON,
supra at 475).
Measure of Damages (when there no
available market)
The seller is entitled to the full amount of
damage which he has really sustained by a
breached of the contract (DE LEON, supra
at 475).
Measure of Damages (special
circumstance showing proximate
damage)
An amount greater than the difference
between the contract price and market price
when “may be reasonably attributed to the
non-performance of the obligation (CIVIL
CODE, Art. 2201, par. 2).
Example: Hospitalization expenses due to
the refusal of the buyer, without just cause,
to accept the delivery so angered the seller
that the latter suffered a heart attack for
which he was hospitalized (DE LEON, supra
at 476).
Measure of Damages for Repudiation or
Countermand
The measure of damages would include:
i. The labor performed and expenses
incurred for materials before receiving
notice of the buyer’s repudiation; and
ii. The profit he would have realized if the
sale had been fully performed (CIVIL
CODE, Art. 1596, par. 4).
c. Technical Rescission (CIVIL CODE, Art.
1597)
This article applies where there has been no
delivery of goods yet.
In the following instances, the seller may
totally rescind by giving notice of his election
to do so to the buyer:
i. Buyer has repudiated the contract of
sale;
ii. Buyer has manifested his inability to
perform obligations thereunder; or
iii. Buyer has committed a breach
NOTE: The seller is required to give notice
of his election to seek rescission. Formal
notice is certainly not a requisite, and
bringing an action promptly for restitution is
sufficient (DE LEON, supra at 477).
If the goods have been delivered, the seller
may recover the value of what he has given
(CIVIL CODE, Art 1595).
UNPAID SELLER
1. The seller who to whom the whole of the price
has not been paid or tendered;
2. The seller of the goods, in case a bill of
exchange or other negotiable instrument has
been received as conditional payment, and the
condition on which it was received has been
broken by reason of the dishonor of the
instrument, insolvency of the buyer or otherwise
(CIVIL CODE, Art. 1525).
The term seller as used in Articles 1525 to
1535 includes the following:
a. Agent of the seller, to whom the bill of lading
has been indorsed;
b. Consignor or agent who has himself paid, or
is directly responsible for the price; or
c. Any other person in the position of the seller
(CIVIL CODE, Art. 1525).
NOTE: A seller is unpaid within the definition
whether title has or has not passed (CIVIL CODE,
Art. 1526).
TENDER OF PAYMENT BY BUYER
So far as concerns his rights against the goods, he
is not an unpaid seller after the tender of the price
(DE LEON, supra at 298).
REMEDIES OF UNPAID SELLER:
(PoS4A2RM)
1. Possessory lien (CIVIL CODE, Arts. 1527 to
1529);
2. Stoppage of goods in transitu (CIVIL CODE, Art.
1530);
3. Special right of resale (CIVIL CODE, Art. 1533);
4. Special right of rescission (CIVIL CODE, Art.
1534);
5. Specific performance;
6. Action for the price;
7. Action for damages;
8. Recto Law (CIVIL CODE, Art. 1484); and
9. Maceda Law (R.A. No. 6652).
POSSESSORY LIEN (CIVIL CODE, Art. 1527)
The seller is entitled to retain possession of the
goods as security for the purchase price.
When it may be exercised: (WEI)
1. The goods have been sold Without any
stipulation as to credit.
The seller is entitled to the payment of the price
at the same time that he transfers the
possession of the goods (CIVIL CODE, Art.
1524).
2. The goods have been sold on credit, but the
term of credit has Expired.
The obligation of the buyer to pay shall be
governed by Article 1524 of the Civil Code (DE
LEON, supra at 301).
3. The buyer becomes Insolvent (CIVIL CODE, Art.
1527).
Insolvent – A person who ceased to pay his
debts in the ordinary course of business or
cannot pay his debts as they become due,
whether insolvency proceedings have been
commenced or not (CIVIL CODE, Art. 1636, par.
2).
Basis: When one party to a bilateral contract is
incapacitated from performing his part of the
agreement, the other party is also excused from
performing his part (DE LEON, supra at 300).
NOTE: The seller may exercise his right of lien
notwithstanding that he is in possession of the goods
as agent or bailee for the buyer (CIVIL CODE, Art.
1527, par. 2).
When Unpaid Seller Has Made Part Delivery of
the Goods
GENERAL RULE: He may exercise his right of lien
on the remainder that has not been delivered (CIVIL
CODE, Art. 1528).
EXCEPTION: When part delivery has been made
under such circumstances as to show an intent to
waive the lien or right of retention (CIVIL CODE, Art.
1528).
When unpaid seller loses his lien: (COW)
1. Delivery of the goods to a Carrier or other bailee
for the purpose of transmission to the buyer
without reserving ownership in the goods or right
to the possession thereof;
REASON: An unconditional delivery to an agent
or bailee for the buyer is the same as delivery to
the buyer insofar as the seller’s lien is concerned
(DE LEON, supra at 303).
2. When the buyer or his agent lawfully Obtains
possession of the goods;
REASON: The seller has no possession
necessary for a lien (Id.).
3. By Waiver of the lien (CIVIL CODE, Art. 1529).
Loss of Lien
The lien of the seller depends upon either
possession or control of the property on which the
lien is claimed, and if the seller permits the property
to go into actual possession of the buyer, such lien
is lost, although he delivers on the faith of a chattel
mortgage which turns out to be invalid, or draft given
in payment was dishonored. If, however, the seller
has been induced to part with possession by fraud,
the lien of the seller is not lost but continues (5
TOLENTINO, Civil Code, supra at 82).
Revival of Lien after Delivery:
1. If the goods are rejected by the buyer, and the
carrier or other bailee continues in possession of
them, even if the seller has refused to receive
them back (CIVIL CODE, Art. 1531, pars. 1 and
2).
2. If the buyer refuses to receive the goods in
wrongful repudiation of the sale, provided that
the seller makes it clear in accepting the goods
from the buyer that he is not assenting to the
rescission of the sale (DE LEON, supra at 304).
However, the return of the goods by the buyer to
the seller not in repudiation of the sale but for
some special purpose, such as to have repairs
or alterations by the seller, does not revive the
lien of the seller (5 TOLENTINO, supra at 83).
NOTE: Possessory lien is lost after the seller loses
possession but his lien as an unpaid seller remains.
His preference can only be defeated by the
government’s claim to the specific tax on the goods
themselves (CIVIL CODE, Arts. 2241, 2242 and
2247).
Possessory lien is different from lien on the price. In
the first, the seller is entitled to retain possession of
the goods as security for the purchase price. In the
second, after delivery, the seller loses his
possessory lien but retains his lien on the price of the
goods (PINEDA, Sales, supra at 199).
STOPPAGE OF GOODS IN TRANSITU
A right which a seller of goods on credit has to recall
them or retake them while they are in possession of
a carrier or other middleman who received them for
delivery to the buyer, on discovery of the insolvency
of the buyer (DE LEON, supra at 305).
Requisites: (UI-TE-RE)
1. Seller must be Unpaid (CIVIL CODE, Art. 1525);
2. Buyer must be Insolvent (CIVIL CODE, Art.
1530);
NOTE: The buyer’s insolvency need not be
judicially declared (CIVIL CODE, 1636 par. 2).
3. Goods must be in Transit (CIVIL CODE, Art.
1531); and
4. Seller or his agent in that behalf must Either:
a. Actually take possession of the goods sold;
or
b. Give notice of his claim to the carrier or other
person in possession of the goods (CIVIL
CODE, Art. 1532, par. 1).
NOTE: The carrier may incur liability to the seller
for delivering the goods to the buyer
notwithstanding the proper and timely notice to
stop in transitu (DE LEON, supra at 308).
5. The carrier or other person in possession must
Redeliver the goods to, or according to the
directions of, the seller (CIVIL CODE, Art. 1532,
par. 2); and
6. The seller must bear the Expenses of delivery of
the goods after the exercise of the right (CIVIL
CODE, Art. 1532, par. 2).
Notice may be given either to the person in actual
possession of the goods or to his principal (CIVIL
CODE, Art. 1532, par. 1).
Basis of the Right of Stoppage in Transitu
The injustice of allowing the buyer to acquire
ownership and possession of the goods when he
has not paid and, owing to his insolvency, cannot
pay the price which was to be given in return for the
goods.
One man’s property should not be applied in
payment of another’s man’s debt (DE LEON, supra
at 307).
Cash Sales
No right of stoppage in transitu exists in a cash sale.
The sale must be on credit to entitle the seller the
right (DE LEON, supra at 306).
Effect of the Exercise of Right by Seller
1. To restore the seller to the same position as if
the property never left his possession (CIVIL
CODE, Art. 1530), but subject to lien of carrier
for freight charges;
2. It does not operate to rescind the sale, and if the
buyer has paid part of the price, does not entitle
the buyer to recover such part payment; and
3. The seller may sue and recover the agreed
price, provided he is ready and willing to deliver
the goods on payment (DE LEON, supra at 308).
Requirement of Insolvency
The seller cannot exercise the right at the mere
caprice of the seller where no insolvency exists. The
following circumstances do not justify the exercise of
the right of stoppage in transitu:
1. The buyer was in default in the performance of
his obligations;
2. The death of the buyer, unless his estate is
insolvent; or
3. The fact that the goods have been levied on by
attaching creditors of the buyer, unless the
buyer is insolvent (DE LEON, supra at 307).
Time of Insolvency
The buyer became insolvent before he has taken
possession of the goods, or insolvency existed at the
time of the sale, if it was not discovered until
afterwards by the seller, then the seller has the right
of stoppage (Id.).
When the Goods are considered “In Transit”:
1. From the time when they are delivered to a
carrier or other bailee and before the buyer or
his agent takes delivery of them; and
2. If the goods are rejected by the buyer, and the
carrier or other bailee continues in possession of
them (even if the seller refused to receive them
back) (CIVIL CODE, Art. 1531, par. 1).
Mere arrival of the goods at or on the premises of the
carrier at the point of destination does not terminate
the transportation for transit includes not only the
carriage of the goods to the destination, but also
delivery according to the terms of the contract (DE
LEON, supra at 310).
The mere act of the carrier or middleman in giving
notice to the buyer regarding the arrival of the goods
is not a termination of the transit (Id.).
NOTE: Taking of the goods in transit by an
unauthorized agent of the buyer does not extinguish
the right of stoppage in transitu (5 PARAS, Civil
Code, supra at 166).
In case of misdelivery, the goods are still considered
in transit, hence, the seller may still exercise said
right pursuant to Article 1532 of the Civil Code, which
provides that an unpaid seller may exercise his right
of stoppage in transitu by giving notice of his claim
to the carrier “or other bailee in whose possession
the goods are.”
When the Goods are NO Longer in Transit:
(ADAR)
1. After delivery to the buyer or his agent in that
behalf;
2. If the buyer or his agent obtains Delivery of the
goods at a point before their arrival at the
appointed destination;
3. If after the arrival of the goods at the appointed
destination, the carrier or the bailee
Acknowledges to hold the goods in behalf of the
buyer (also known as Attornment by the Bailee)
(DE LEON, supra at 310); and
4. If the carrier or bailee wrongfully Refuses to
deliver the goods to the buyer (CIVIL CODE, Art.
1531, par. 2).
When a carrier first receives goods consigned to the
buyer, the carrier is agent for the seller for the
purpose of delivering the goods to the buyer. In order
to terminate the seller’s right to stop, the carrier must
enter into a new relation, distinct from the original
contract of carriage, so that he then holds
possession of goods for the buyer as his agent for
the purpose of custody on the buyer’s account (DE
LEON, supra at 311).
Effect of Refusal to Deliver:
1. Wrongful Refusal
– The goods are no longer in transit. The carrier
is not allowed to extend the seller’s right by
refusing to deliver the goods to the buyer or his
agent in that behalf (CIVIL CODE, Art. 1531, par.
2(3)).
2. Rightful Refusal
– Right to stop by the seller would not be
terminated (DE LEON, supra at 311).
Delivery to a Carrier Chartered by the Buyer
It does not make a delivery to the carrier a delivery
to the buyer. It is a question depending on the
circumstances of the particular case (CIVIL CODE,
Art. 1531, par. 3).
Effect of Partial Delivery
It does not deprive the seller of the right to stop with
respect to the remainder unless it may be shown that
the seller has an agreement with the buyer to give
up possession of the whole of the goods (CIVIL
CODE, Art. 1531, par. 4)
Effects of the Exercise of the Right of Stoppage
in Transitu:
1. The goods are no longer in transit (CIVIL CODE,
Art. 1531, par. 2);
2. The contract of carriage ends after the arrival of
the goods at the destination. The carrier now
becomes a mere bailee, and will be liable as
such (CIVIL CODE, Art. 1531, par. 2(2)); and
3. The seller would have the same rights to the
goods as if he had never parted possession with
it (CIVIL CODE, Art. 1530).
Ways of Exercising the Right:
1. By taking actual possession of the goods; or
2. By giving notice of his claim to the carrier or
bailee in whose possession the goods are
(CIVIL CODE, Art. 1532, par. 1).
Effect if the Buyer Already Sold the Goods:
GENERAL RULE: The unpaid seller’s right to lien or
stoppage in transitu remains even if buyer has sold
the goods (CIVIL CODE, Art. 1535).
EXCEPTIONS:
1. When the seller has given consent thereto; and
2. When a negotiable document of title has been
issued for the goods (CIVIL CODE, Art. 1535).
REASON: It operates as a delivery of the goods
described therein when indorsed. It protects a
purchaser without notice after the seller had
stopped the goods either by virtue of his lien or
stoppage in transitu (DE LEON, supra at 320).
Where Goods Not Covered by Negotiable
Document of Title
A seller cannot give any right larger than he has.
When the goods are subject to a legal lien, a
purchaser from the original buyer can acquire only
such rights as the buyer then had (Id.).
SPECIAL RIGHT OF RESALE: (LSPRD)
An unpaid seller can exercise the right to resell only
when he has either:
1. A right of Lien (CIVIL CODE, Art. 1526 (1)); or
2. Exercised the right to Stop the goods in transit
(CIVIL CODE, Art. 1526 (2)); and under any of
the three (3) following cases:
a. Goods are Perishable in nature;
b. The right to resell is expressly Reserved in
case the buyer should make a default; or
c. The buyer Delays in the payment of the
price for an unreasonable time (CIVIL
CODE, Art. 1533).
NOTE: Article 1533 of the Civil Code applies only if
the title to goods has already passed to the buyer.
Otherwise, the goods cannot be resold.
Article 1533 provides that the seller having the right
“may resell the goods”. The language is permissive
in nature rather than mandatory (DE LEON, supra at
316).
Effect of Resale
The new buyer acquires a good title as against the
original buyer (CIVIL CODE, Art. 1533, par. 2).
IF SOLD FOR MORE IF SOLD FOR LESS
THAN THE ORIGINAL THAN THE
PRICE ORIGINAL PRICE
The seller is not liable to The seller has right
the original buyer for any to sue for the
profit earned in the resale balance (CIVIL
(CIVIL CODE, Art. 1533, CODE, Art. 1533,
par. 1). par 1).
The seller is not liable to the original buyer for any
profit earned in the resale and may recover damages
occasioned by the buyer’s breach of the contract of
sale. Action for the rescission of the sale is not
necessary (PINEDA, Sales, supra at 211).
Notice of Resale Not Essential
Though the seller is not bound to give notice of his
intention to resell and of the time and place where
the resale will be held (CIVIL CODE, Art. 1533, par.
4).
It is prudent to give the buyer such notice, as the
giving or failure to give it may be important evidence
in regard to the fairness of the sale (DE LEON, supra
at 317).
Manner of Resale
The law is satisfied with a fair sale made in good faith
according to established business methods with no
attempt to take advantage of the vendee (Id.).
NOTE: The seller cannot, directly or indirectly, buy
the goods (CIVIL CODE, Art. 1491, par. 6).
Time of Resale
Must be made within a reasonable time after the
breach (DE LEON, supra at 317).
Place of Resale
GENERAL RULE: At the place of delivery (Id.).
EXCEPTION: At another place if the seller is unable
to sell readily at a fair price at the place of delivery
and can get a better price by reshipment and sale at
another place (Id.).
NOTE: The seller cannot, arbitrarily and without
good reason, take the goods to another market and
hold the buyer for the difference between the
contract price and the amount for which the property
was resold, including the cost of transportation (Id.).
SPECIAL RIGHT TO RESCIND: (LSRD)
The unpaid seller having either:
1. The right of Lien (CIVIL CODE, Art. 1526, par.
1); or
2. A right to Stop the goods in transit, when seller
has already parted with possession of the goods
(CIVIL CODE, Art. 1526, par. 1, (2)), and under
either of the two (2) situations:
a. Where the right to rescind on default has
been expressly Reserved; or
b. Where the buyer has been in Default for an
unreasonable time (CIVIL CODE, Art. 1534,
par. 1).
Effect of Exercising Right of Rescission
The seller shall not thereafter be liable to the buyer
upon the contract of sale but may recover from the
buyer damages for any loss occasioned by the
breach of contract (CIVIL CODE, Art. 1534, par. 1).
Effect of Rescission
The seller resumes the ownership of the goods
(CIVIL CODE, Art. 1534, par. 1).
Manner of Rescission
There must be notice or some other overt act of an
intention to rescind. Overt act need not be
communicated but the giving of notice is relevant in
determining the reasonableness of the time given
the buyer to make good his obligations under the
contract (CIVIL CODE, Art. 1534, par. 2).
RISK OF LOSS AND
DETERIORATION AND
ITS EFFECTS
1. Loss of the thing BEFORE
PERFECTION of the contract
The thing perishes with the owner (res perit
domino) (CIVIL CODE, Art. 1504).
Seller still owns the thing because there is no
delivery or transfer of ownership yet. Hence, the
seller bears the risk of loss (VILLANUEVA,
supra at 316).
2. Loss of the thing AT PERFECTION of
the contract
Res perit domino applies (CIVIL CODE, Art.
1504).
a. If the thing is entirely lost, the contract is
without effect (CIVIL CODE, Art. 1493, par.
1).
b. If the thing should have been lost in part
only, the buyer may choose between:
i. Withdrawing from the contract; or
ii. Demanding the remaining part, paying
its proportionate price (CIVIL CODE,
Art. 1493, par. 2).
NOTE: As there is no distinction, even if the loss
is not substantial, res perit domino applies
(PINEDA, Sales, supra at 109).
The contract is considered void or inexistent
because the object did not exist at the time of
the transaction. Any action for the enforcement
of such void contract can be defeated by a
motion to dismiss or by setting up a counter-
claim for the declaration of its nullity (Id. at 108).
3. Loss of the thing AFTER
PERFECTION BUT BEFORE
DELIVERY
a. Loss
GENERAL RULE: Who bears the risk of
loss is governed by the stipulations in the
contract.
In the absence of stipulation, there are two
conflicting views:
First View: Res perit creditori or buyer
bears the risk of loss (this is the view
subscribed to by the following Civil Law
authors: Paras, Vitug, Padilla, and De
Leon).
Justification: Art. 1504 of the Civil Code,
which embodies res perit domino, only
covers goods.
Goods, as defined in Art. 1636 par. 1 (1) of
the Civil Code, includes all chattels personal
but not things in action or money of legal
tender in the Philippines. The term includes
growing fruits or crops.
The obligation to pay on the part of the buyer
is not extinguished (as he is not the obligor)
(VILLANUEVA, supra at 319).
Under the Roman Law, the reciprocal
obligations of the parties are considered
distinct stipulations.
Under the same law, “the risk of the thing
sold passes to the buyer, even though he
has not received the thing. For the seller is
not liable for anything which happens
without his fraud or negligence x x x.”
The Spanish Civil Code follows Roman law
by imposing upon the vendee the obligation
to pay the price of the thing sold that was
lost as a result of fortuitous event (DE
LEON, supra at 125).
Article 1480 of the Civil Code is based on
Article 1452 of the Spanish Civil Code; there
is reasonable basis for the proposition that
Article 1480 follows the principle of
perfection (e.g. the risk of loss is transmitted
to the buyer from the moment the contract is
perfected) (Id. at 126).
This theory is an exception to the rule of res
perit domino.
Article 1164 gives the creditor (buyer) the
right to the fruits of the ting from the time the
obligation to deliver arises (or from the time
perfection of the contract)
Pursuant to Article 1537 of the Civil Code,
all the fruits shall pertain to the vendee from
the day on which the contract was perfected.
Rationale: If the buyer is entitled to the fruits
of the thing from the moment of perfection of
the contract, it is logical that the buyer bears
the risk of loss from the moment of the
perfection (Id.).
Under Article 1165, the implication is that if
the seller was not at fault, the buyer is
responsible for the fortuitous event even
prior to the delivery.
Pursuant to Article 1262 of the Civil Code, if
the thing is lost or destroyed without the fault
of the debtor (or seller in case of sale), the
obligation to deliver is extinguished but the
obligation to pay, shall subsist (PINEDA,
Sales, supra at 70).
The third paragraph of Article 1480 purports
to provide different rule from the first two (2)
paragraphs of Article 1480. Under the third
paragraph, should fungible things be sold for
a price fixed according to weight, number, or
measure, the risk shall not be imputed to the
vendee (buyer) until they have weighed,
counted, or measured, and delivered.
NOTE: The implication is that with respect b. Deterioration
to items covered by the first two (2) Impairment is borne by the buyer if the thing
paragraphs, the risk of loss is with the buyer deteriorates without the fault of the seller
even prior to the delivery (DE LEON, supra (CIVIL CODE, Art. 1189, par. 3)
at 127).
If it deteriorates through the fault of the
Second View: Res perit domino or seller debtor, the creditor may choose between
bears the risk of loss (this is the view the rescission of the obligation and its
subscribed to by the following Civil Law fulfillment, with indemnity for damages in
authors: Tolentino, Jurado, Baviera, and either case (CIVIL CODE, Art. 1189, par. 4).
Villanueva).
4. AFTER DELIVERY
Justification: Dr. Tolentino opines that in
Res perit domino applies.
reciprocal obligations, the extinguishment of
the obligation due to loss of the thing affects
The buyer is the owner, hence, the buyer bears
both debtor and creditor; the entire juridical
risk of loss (CIVIL CODE, Art. 1504).
relation is extinguished. Under this view, the
rule on loss under Article 1189 would be
Exceptions:
different from the rule on deterioration – the
a. Where delivery has been made either to the
loss would be for the account of the seller,
buyer or to the bailee for the buyer, but
while the deterioration would be for the
ownership in the goods has been retained
account of the buyer (this view is affirmed by
by the seller merely to secure performance
Baviera).
by the buyer of his obligations under the
contract (CIVIL CODE, Art. 1504, par. 1);
Article 1480, paragraph 3, is not an
and
exception but is an expression of the
b. Where actual delivery has been delayed
general rule that the risk is not imputed to
through the fault of either the buyer or seller,
the vendee until after delivery (A.M
the goods are at the risk of the party in fault
Tolentino, op.cit., pp. 23-27).
(CIVIL CODE, Art. 1504, par. 2).
Purchase and sale is an onerous contract,
where the cause, with respect to the
vendee, is the thing. If he cannot have the
thing, it is juridically illogical and unjust to EXTINGUISHMENT
make him pay the price (Id.). OF SALE
According to Justice Jurado, this view is
more just and equitable and more in
conformity with the principle of res perit CAUSES OF EXTINGUISHMENT:
domino.
1. Same causes as all other obligations (CIVIL
CODE, Arts. 1231 and 1600);
According to Dean Villanueva, this view
2. Conventional Redemption (CIVIL CODE, Arts.
would make Articles 1480 and 1538
1601-1618); or
consistent with the provisions of Article 1504
3. Legal Redemption (CIVIL CODE, Arts. 1619-
(VILLANUEVA, supra at 323).
1623).
According to Pineda:
Payment or performance only extinguishes the
i. Ownership is transferred only after
obligations to which they pertain to in a contract of
delivery;
sale, but not necessarily the contract itself since the
ii. Art.1480, par. 3, is an expression of the
relationship between buyer and seller remains after
general rule that the risk is not imputed
the performance or payment, such as the continuing
to the vendee until after delivery; and
enforceability of the warranties of the seller
iii. The contract is reciprocal. If the vendee
(VILLANUEVA, supra at 516).
cannot have the thing, it is illogical and
unjust to make him pay the price
(PINEDA, Sales, supra at 69). CAUSES OF EXTINGUISHMENT, IN
GENERAL: (PaLoCo3-PARe-FuN)
1. Payment or performance of obligation;
2. Loss of the thing due;
3. Condonation or remission of debt;
4. Confusion or merger of rights; 8. Gives Reciprocal obligation (CIVIL CODE, Art.
5. Compensation; 1616); and
6. Prescription; 9. Reserved at the Moment of the perfection of
7. Annulment; contract (Diamante v. CA, G.R. No. L-51824,
8. Rescission; February 7, 1992).
9. Fulfillment of a resolutory condition; or
10. Novation (CIVIL CODE, Art. 1231). Proper Reservation of Right to Repurchase
The right to redeem must be reserved by the seller
CONVENTIONAL REDEMPTION through a stipulation to that effect in the contract of
The right which the vendor reserves to himself, to sale (Villarica v. CA, G.R. No. L-19196, November
reacquire the property sold, provided he returns to 29, 1968).
the vendee: (PEONU)
For a sale to be one a retro, the right must be
1. Price of the sale;
reserved in the same sale contract (Torres v. CA,
G.R. No. 134559, December 9, 1999).
NOTE: The law speaks of “price of the sale” and
not the value of the thing. It is lawful for the
The essence of a pacto de retro sale is that title and
parties to agree that the price to be returned will
ownership of the property sold is immediately vested
be more or less than the original sum paid by the
in the vendee a retro, subject to the restrictive
vendee (DE LEON, supra at 539).
condition of repurchase by the vendor a retro within
the redemption period (Misterio v. Cebu State
2. Expenses of the contract; College of Science and Technology, G.R. No.
152199, June 23, 2005).
3. Any Other legitimate payments made
therefore; Parol Evidence
The right of repurchase may be proved by parol
NOTE: Numbers 1 and 2 need not be paid at the evidence when the contract of sale has been
very time of the exercise of the right since they reduced in writing (Mactan Cebu International
are unknown amounts. They may be paid later. Airport Authority v. CA, G.R. No. 121506, October
The same is true of necessary and useful 30, 1996).
expenses (DE LEON, supra at 539).
RIGHT TO REDEEM V.
4. Necessary expenses made on the thing
OPTION TO PURCHASE
sold; and
OPTION TO
RIGHT TO REDEEM
5. Useful expenses made on the thing sold PURCHASE
(CIVIL CODE, Arts. 1601 and 1616).
As to Nature
NOTE: The vendor must comply not only with
Not a separate contract Generally, it is a
the provisions of Article 1616 but also with other
but merely part of the principal contract and
stipulation that may have been agreed upon by
main contract of sale. may be created
the parties relating to the exercise of the right
independent of another
(Solid Homes, Inc. v.CA, G.R. No. 117501, July
contract.
8, 1997).
As to Consideration
Nature of Conventional Redemption:
(CAP2OR3M) Does not need its To be valid, it must have
1. Purely Contractual (Ordonez v. Villaroman, G.R. separate consideration a consideration
No. L-238, March 13, 1947); in order to be valid and separate and distinct
2. Accidental (Alojado v. Lim Siongco, G.R. No. effective. from the purchase
27084, December 31 1927); price.
3. Potestative (CIVIL CODE, Art. 1182);
4. Power or privilege (Ocampo v. Potenciano, G.R. As to Maximum Period for Exercise of the
No. L-2263, May 30 1951); Right
5. Person entitled to exercise is necessarily the
Owner (Quimson v. PNB, G.R. No. L-24920, Cannot exceed ten (10) May be beyond ten (10)
November 24 1970); years years.
6. Real right (CIVIL CODE, Art. 1608);
7. Resolutory condition (CIVIL CODE, Art. 1179);

OPTION TO
RIGHT TO REDEEM
PURCHASE
As to How Exercised
There must be a tender May be exercised by
of payment of the notice of its exercise to
amount required by law, the offeror.
including consignment
thereof if tender of
payment cannot be
made effectively on the
buyer.
(DE LEON, supra at 488).
Period of Redemption
When No Period is agreed upon
It shall last for four (4) years from the date of the
contract (Id. at 519; CIVIL CODE, Art. 1606).
However, in Misterio v. Cebu State College of
Science and Technology, the four (4) year period
was held to begin from the happening of the
stipulated condition contained in the covering deed
of sale rather than from the date of the contract, and
even when the entire covered period from the date
of the contract would exceed ten years. Since the
vendor may still exercise the right to repurchase
within thirty days from the time final judgment was
rendered in a civil action on the basis that the
contract was a true sale with right to repurchase
(G.R. No. 152199, June 23, 2005).
When Period is agreed upon
The period cannot exceed ten (10) years (CIVIL
CODE, Art. 1606). If it exceeds ten (10) years, the
agreement is valid only for the first ten (10) years
(Anchuelo v. IAC, G.R. No. 71391, January 29,
1987).
When a period of redemption is agreed upon by the
parties in a sale a retro, although the period agreed
upon may be unclear or void, it is the 10-year period
and not the four (4) year period that shall apply
(Tayao v. Dulay, G.R. No. L-21160, April 30, 1965).
When the Period agreed upon is “Indefinite"
(E.g. vendor a retro shall repurchase “at any time he
has money” or vendor will redeem “within the month
of March of any year”), the time of redemption is
within ten (10) years from execution of contract
(PINEDA, Sales, supra at 38).
Date from which Period Reckoned
At the date of the contract from which the contract
produces its effects (e.g. from the fulfillment of the
suspensive condition) (DE LEON, supra at 526).
NOTE: The right to redeem becomes functus officio
on the date of its expiry, and its exercise after the
period is not really one of redemption but a right of
repurchase (Id. at 489).
Pendency of Action Tolls Redemption Period
The pendency of an action brought in good faith and
relating to the validity of a sale a retro tolls the
running of the period of redemption (Ong Chua v.
Carr, G.R. No. L-29512, January 17, 1929).
Non-payment of price does not affect the running of
the redemption period (Catangcatang v. Legayada,
G.R. No. L-26295, July 14, 1978).
Possession of the Subject Matter during Period
of Redemption
Buyer has a right to the immediate possession of the
property sold, unless otherwise agreed upon. This is
subject only to the resolutory condition of repurchase
by the seller a retro within the stipulated period (Solid
Homes, Inc. v. CA, G.R. No. 117501, July 8, 1997).
Exercise of Redemption
Tender of payment is sufficient to compel
redemption but is not in itself a payment that relieves
the vendor from his liability to pay the redemption
price (Mclaughlin v. CA, G.R. No. L-57552, October
10, 1986).
The law requires that the offer must be a bona fide
one and accompanied by an actual and
simultaneous tender of payment or consignation of
the full amount agreed upon for repurchase
(Catangtang v. Legayada, G.R. No. L-26295, July
14,1978).
It is enough for the vendor a retro to tender the
repurchase price at the time of redemption. The
other amounts provided under Article 1616 of the
Civil Code may be paid afterwards. Tender of
payment is needed in order to show that the
repurchase was made within the redemption period
(5 TOLENTINO, supra at 175).
CONSIGNATION
GENERAL RULE: It is not a legal requisite for a
vendor to make consignation or judicial deposit of
the price if the offer or tender is refused. He is not a
debtor. He has a right, not an obligation, to
repurchase (DE LEON, supra at 543).
EXCEPTION:
1. The vendee a retro refuses to accept the
redemption price (Torrijos v. Crisologo, G.R. No.
L-17734, September 29, 1962); or
2. When a judicial action has already been filed to
enforce compliance with the contract of sale with
right of repurchase (Rivero v. Rivero, G.R. No.
L-578, April 30, 1948).
Consignation is imperative when the tender of
payment cannot be validly made because the buyer
cannot be located, and failing to do so within the
redemption period, the right of redemption shall
lapse (Catangtang v. Legayada, G.R. No. L-26295,
July 14, 1978).
IN CASE OF MULTI-PARTIES
Redemption in Sale of Part of Undivided
Immovable
The buyer of a part of an undivided immovable who
acquires the whole thereof in the case of Article 498
of the Civil Code may compel the seller to redeem
the whole property, if the latter wishes to make use
of the right of redemption (CIVIL CODE, Art. 1611).
Illustration: A, B and C are co-owners of an
undivided parcel of land. A sold his undivided portion
to D with right of repurchase. As a result of a
partition, D who is now one of the co-owners,
acquired the whole land after paying the portions
belonging to B and C. If A would like to repurchase
the portion sold by him, D may compel him to
redeem the entire parcel of land so that the property
will not revert to a state of co-ownership (DE LEON,
supra at 534-535).
Redemption in Joint Sale by Co-Owners /
Co-Heirs of Undivided Immovable
If several persons, jointly and in the same contract,
should sell an undivided immovable with a right of
repurchase, none of them may exercise this right for
more than his respective share. The same rule shall
apply if the person who sold an immovable alone has
left several heirs (CIVIL CODE, Art. 1612).
The buyer may demand of all the vendors or co-heirs
that they come to an agreement upon the re-
purchase of the whole thing sold; and should they
fail to do so, the buyer cannot be compelled to
consent to a partial redemption (CIVIL CODE, Art.
1613).
NOTE: The redeeming co-owner cannot claim
exclusive right to the property owned in common.
Registration of property is not a means of acquiring
ownership. It operates as a mere notice of existing
title, that is, if there is one (Adille v. CA, G.R. No. L-
44546, January 29, 1988).
Redemption in Separate Sales by Co-
Owners of Undivided Immovable
Each one of the co-owners of an undivided
immovable who may have sold his share separately,
may independently exercise the right of repurchase
as regards his own share, and the buyer cannot
compel him to redeem the whole property (CIVIL
CODE, Art.1614).
REASON: It would be unjust to require the co-
owners to come to an agreement with regard to the
repurchase of the thing sold, and certainly, it would
be worse to deprive them of their right in case they
fail to disagree.
The very purpose of the law is to prevent unjust
enrichment (DE LEON, supra at 538).
Illustration: X, Y and Z are co-owners of a parcel of
land. If they should sell the property to B with the
right to repurchase in the contract, each one of them
may exercise that right only as regards his own
share or for one-third portion of the property.
The same rule applies if C is the sole owner of the
land and he sold it with right to repurchase to B and
should he die and leave X, Y and Z as his heirs. Each
one of them can only exercise the right of
redemption for the one-third portion he has inherited.
But B can demand that they come to an agreement
upon the repurchase of the whole property by all of
them or any one of them. If they do not do so, B
cannot be compelled to assent to a partial
redemption (CIVIL CODE, Art. 1611).
If X, Y and Z sold their respective shares to B with
the right of repurchase in separate instruments and
at different dates, each one of them may exercise his
right independently of the others and B cannot
compel any of them to redeem the whole property.
Redemption against Heirs of Vendee
If the vendee should leave several heirs, the action
for redemption cannot be brought against each of
them except for his own share, whether the thing is
undivided or it has been partitioned among them. But
if the inheritance has been divided and the thing sold
has been awarded to one of heirs, the action for
redemption may be instituted against him for the
whole (CIVIL CODE, Art. 1615).
Illustration: S sold his parcel of land to B with right
to repurchase. Then B died leaving C, D and E as
his heirs. The right of redemption of S is against
each of the heirs only for his respective share or for
one-third of the property. If the property has been
awarded to C by partition, then the action of
redemption may be instituted against him for the
entire property.
In De Guzman v. CA, the Court held that under the
rules in Article 1612 of the Civil Code, should one of
the co-owners or co-heirs succeed alone in
redeeming the whole property, such co-owner or co-
heir shall be considered as a mere trustee with
respect to the shares of his co-owners or co-heirs;
accordingly, no prescription will lie against the right
to any co-owner or co-heir to demand from the
redemptioner his respective share in the property
redeemed (De Guzman v. CA, G.R. No. L-47378,
February 27, 1987).
NOTE: The purpose of Article 1611-1615 is to
discourage co-ownership which is recognized as
undesirable, since it does not encourage the
improvement of the property co-owned (DE LEON,
supra at 534).
Judicial Order for Recording of
Consolidation of Ownership
In case of real property, the consolidation of
ownership in the buyer shall not be recorded in the
Registry of Property without a judicial order, after the
seller has been duly heard (CIVIL CODE, Art. 1607).
Art. 1607 of the Civil Code abolished automatic
consolidation of title in the buyer (a retro) upon
expiration of the redemption period by requiring the
buyer to institute an action for consolidation where
the vendor (a retro) may be heard (VILLANUEVA,
supra at 484).
Notwithstanding Article 1607 of the Civil Code, the
recording of the consolidation of ownership is not a
condition sine qua non to transfer the ownership
(VILLANUEVA, supra at 485).
PURPOSE: To minimize the evils of which the pacto
de retro sale has caused in the hands of usurpers
(Cruz v. Leis, G.R. No. 125233, March 9, 2000).
A judicial order is necessary in order to determine
the true nature of the transaction and to prevent the
interposition of buyers in good faith while the
determination is being made (Cruz v. Leis, G.R. No.
125233, March 9, 2000).
Grant of 30-day Redemption Right in Case of
Litigation
When the period of redemption has expired, then
ipso jure the right to redeem has been extinguished.
However, even when the right to redeem has
expired, and there has been a previous suit on the
nature of the contract, the seller may still exercise
the right to repurchase within thirty (30) days from
the time final judgment was rendered in a civil action
on the basis that the contract was a true sale with
right to repurchase (CIVIL CODE, Art. 1606, par. 3).
Date from which Period Reckoned
At the time the judgment becomes final; and a
judgment becomes final after the period to appeal
had lapsed without one having perfected (DE LEON,
supra at 526).
The 30-day Period is Peremptory
The policy of the law is not to leave the purchaser’s
title in uncertainty beyond the said period. It is not a
prescriptive period but more a requisite or condition
precedent to the exercise of the right of legal
redemption (Pangilinan v. Ramos, G.R. No. 75304,
January 23, 1990).
Non-Applicability
1. Contract found to be an absolute sale (Tapas v.
CA, G.R. No. L-22202, February 27, 1976);
2. Sale known and admitted by vendor as pacto de
retro (Felicen, Sr. v. Orias, G.R. No. L-33182,
December 18, 1987); and
3. When a party abandoned his position that the
transaction was an equitable mortgage after
judicial declaration of transaction as a pacto de
retro sale (Abilla v. Gobonseng, G.R. No.
146651, January 17, 2002).
Effect of Stipulating Extending Period of
Repurchase
1. After expiration of period of redemption – void
and no effect because there is nothing to extend.
The ownership in the vendee is already
consolidated, and becomes absolute (DE
LEON, supra at 526).
NOTE: The parties can enter into an entirely
new agree contract involving the same property,
independent of the pacto de retro sale (Id.).
2. Before the expiration of the period of redemption
– the original term may be extended provided
that the extension, including the original term,
shall not extend beyond 10 years; otherwise, the
extension is void as to the excess (Id.).
Reason for Limiting Period of Redemption
It is not a good thing that the title to property should
be left for a long period of time subject to indefinite
conditions of this nature. The intention of the law is
restrictive and limitative (Id. at 527).
Rights of Parties as to Fruits of Land
If at the time of the execution of the sale there should
be visible or growing fruits on the land, there shall be
no reimbursement for or pro-rating of those existing
at the time of redemption, if no indemnity was paid
by the purchaser when the sale was executed (CIVIL
CODE, Art. 1617, par. 1).
Should there have been no fruits at the time of the
sale and some exist at the time of redemption, they
shall be pro-rated between the redemptioner and the
buyer, giving the latter the part corresponding to the
time he possessed the land in the last year, counted
from the anniversary of the date of the sale (CIVIL
CODE, Art. 1617, par. 2).
Applicability
Article 1617 applies only when there is no sharing
agreement with respect to the fruits existing at the
time of redemption (Almeda v. Daluro G.R. No. L-
28070, October 5, 1997). Otherwise, such
agreement will control. It refers only to natural and When Presumed: (T-PERIOD)
industrial fruits. Civil fruits are deemed to accrue 1. Vendor binds himself to pay the Taxes of the
daily and belong to the vendee in that proportion (DE thing sold (Lumayag v. Heirs of Nemeno, G.R.
LEON, supra at 544). No. 162112, July 3, 2007);
2. Possession by the vendor remains, as lessee or
Right of Vendor a Retro to Recover Thing Sold otherwise (Capulong v. CA, G.R. No. L-61337,
Free from Charges June 29, 1984);
The vendor who recovers the thing sold shall receive 3. Extension of redemption period after expiration
it free from all charges or mortgages constituted by (Lacorte v. CA, G.R. No. 124574, February 2,
the vendee, but he shall respect the leases which the 1998);
latter may have executed in good faith, and in 4. Retention by the vendee of part of the purchase
accordance with the custom of the place where the price (Camus v. CA, G.R. No. 102314, May 26,
land is situated (CIVIL CODE, Art. 1618). 1993);
NOTE: The law establishes an exception with 5. Unusually Inadequate purchase price (Cachola
respect to leases which the vendee may have v. CA, G.R. No. 97822, May 7, 1992);
entered into in good faith according to the customs 6. Any Other case where the parties really
of the place where the land is located. The exception intended that the transaction should secure the
is dictated by public convenience in the interest of payment of a debt or the performance of any
agriculture (DE LEON, supra at 546). obligation (CIVIL CODE, Art. 1602); or
7. In case of Doubt as to whether contract is
EQUITABLE MORTGAGE contract of sale with right of repurchase or an
One which, although lacking in some formality, or equitable mortgage (CIVIL CODE, Art. 1603).
form or words, or other requisites demanded by a
statute, nevertheless reveals the intention of the NOTE: The provision of Article 1602 shall also apply
parties to charge real property as security for a to a contract purporting to be a sale with right to
debt, and contains nothing impossible or contrary repurchase shall be construed as an equitable
to law (Ceballos v. Mercado, G.R. No. 155856, May mortgage (CIVIL CODE, Art. 1604).
28, 2004).
This holds true if indeed, the real intention of the
Presumption of Equitable Mortgage Arises when parties is that the transaction shall secure the
1. Parties entered into a contract denominated as payment of a debt or the performance of any other
sale; and obligation (Cruz v. CA, G.R. No. 143388, October 3,
2. Their intention was to secure an existing debt by 2003).
way of mortgage (Romulo v. Sps. Layug, G.R.
No. 151217, September 8, 2006). PACTO DE RETRO V. MORTGAGE
PACTO DE RETRO MORTGAGE
A Right of Repurchase for an Extended Period is
in Reality an Equitable Mortgage As to Nature
A perusal of the Deed of Conditional Sale reveals the
real intention of the parties is not to enter into a Ownership is Ownership is not
contract of sale but merely to secure the payment of immediately transferred, transferred but the
the loan of Prisco+. This is evident from the fact that subject to the resolutory property is merely
the latter was given the right to repurchase the condition of repurchase subject to a charge or
subject property even beyond the 12-year (original by the vendee. lien as security.
and extended) period, allowing in the meantime the
continued possession of Ernesto pending payment As to Interest
of the consideration. Under these conditions and in
accordance with Article 1602 of the Civil Code. The Failure of seller to Mortgagor does not
constituted pacto de retro sale is in reality an repurchase loses all his lose his interest if he
equitable mortgage. (Gua-an v. Quirino, G.R. No. interest in the property, fails to pay his debt at
198770; November 12, 2012). title to which vests upon maturity but subjects
the buyer by operation of the property to
NOTE: When in doubt, courts are generally inclined law. foreclosure and public
to construe a transaction purporting it to be a sale as sale.
an equitable mortgage, which involves a lesser
As to Foreclosure and Redemption
transmission of rights and interest over property in
controversy (CIVIL CODE, Art. 1603; Salonga v. No obligation upon the Duty of the mortgagee
Concepcion, G.R. No. 151333, September 20, purchaser to foreclose to foreclose if he
2005). nor the vendor to redeem wishes to secure a

after the maturity of the perfect title thereto,
debt. and mortgagor has
right to redeem after
maturity of the debt
and before
foreclosure.
(DE LEON, supra at 492-493).
Reason behind the Provisions on Equitable
Mortgage: To curtail circumvention of the usury law
and pactum commissorium (Ching Sen Ben v. CA,
G.R. No. 124355, September 21, 1999).
Proof by Parol Evidence
Parol evidence may be adduced to prove the
agreement granting the seller a right to repurchase
the property sold, since the deed of sale and the
verbal agreement allowing the right of repurchase
should be considered as an integral whole (Mactan
Cebu International Airport Authority v. CA, G.R. No.
121506, October 30, 1996).
Effects when Sale is adjudged as an Equitable
Mortgage:
1. Money, fruit or other benefit to be received by
the buyer as rent or otherwise shall be
considered as interest (CIVIL CODE, Art. 1602,
par. 2);
2. The apparent seller may ask for the reformation
of the instrument (CIVIL CODE, Art. 1605);
3. The court may decree that “vendor”-debtor pay
his outstanding loan to the “vendee”-creditor
(Banga v. Bello, G.R. No. 156705, September
30, 2005).
4. A remand of the case to the trial court where the
latter did not pass upon the mortgagor’s claim
that he had paid his mortgage obligation, for the
purpose of the determining whether said
obligation has been paid, and if not, how much
should still be paid (Banga v. Bello, G.R. No.
156705, September 30, 2005).
PACTUM COMMISSORIUM
A stipulation for automatic vesting of title over the
security in the creditor in case of debtor’s default
(VILLANUEVA, supra at 492).
Pactum commissorium is among the contractual
stipulations that are deemed contrary to law. It is
defined as “a stipulation empowering the creditor to
appropriate the thing given as guaranty for the
fulfillment of the obligation in the event the obligor
fails to live up to his undertakings, without further
formality, such as foreclosure proceedings, and a
public sale.” It is explicitly prohibited under Article
2088 of the Civil Code (Philnico Industrial Corp. v.
Privatization and Management Office, G.R. No.
199420, August 27, 2014).
NOTE: The creditor cannot appropriate the things
given by way of mortgage or dispose of them. Any
stipulation to the contrary is void (CIVIL CODE, Art.
2088)
The proper remedy is foreclosure of the mortgage. If
there is no foreclosure, the debtor retains the
ownership (Vasquez v. CA, G.R. No. 144882,
February 4, 2005).
Pactum commisorium applies only when the
covering transaction is a mortgage or other security
contracts and has no application to a true sale or
transfer transaction (Vda. De Zulueta v. Octaviano,
G.R. No. L-55350, March 28, 1983).
LEGAL REDEMPTION
The right to be subrogated, upon the same terms
and conditions stipulated in the contract, in the place
of one who acquires a thing by:
1. Purchase;
2. Dation in payment; or
3. Any other transaction whereby ownership is
transferred by onerous title (CIVIL CODE, Art.
1619).
It may beeffected against movables and immovables
(U.S. v. Caballero, G.R. No. 8608, September 26,
1913).
Note: “Ownership is transferred by onerous title”
hence, it is not available in cases of donation,
succession, barter, mortgage or lease (DE LEON,
supra at 547).
Illustration: B is the owner of a land adjoining the
land of A. A donated his own land to X. In this case,
B cannot exercise legal redemption to acquire the
property of A from X since the latter acquired the
adjoining lot gratuitously (donation) and not by
onerous title
It operates only one way and in favor of the
redemptioner. Not having parted with anything, the
legal redemptioner can compel the purchaser to sell
but the former cannot be compelled to buy (DE
LEON, supra at 549).
In sales of property approved by the court in testate
or intestate proceedings for the purpose of raising
funds for payment of debts of the estate are final and
are not subject to legal redemption unlike in ordinary
execution sales (Plan v. IAC, G.R. No. L-65656,
February 28, 1985).
Exercise of Right of Pre-emption or Redemption
It must be exercised within thirty (30) days from the
notice in writing by the prospective vendor, or by the
vendor, as the case may be (CIVIL CODE, Art.
1623).

REASON: The seller of an undivided interest is in
the best position to know who are his co-owners that
under the law must be notified of the sale (Cuizon v.
Remoto, G.R. No.143027, October 11, 2005).
In stressing the mandatory character of the
requirement, the law states that the deed of sale
shall not be accorded in the Registry of Property
unless the same is accompanied by an affidavit of
the vendor that he has given notice thereof to all
possible redemptioners (Primary Structures Corp. v.
Valencia, G.R. No. 150060, August 19, 2003).
Notice must be in Writing
To remove all uncertainty as to the sale, its terms
and its validity and to quiet any doubts that the
alienation is not definitive (Conejero v. CA, G.R. No.
L-21812, April 29, 1966).
NOTE: Without the written notice, the period of 30
days within which the right of legal pre-emption or
redemption may be exercised, does not start
(Guillen v. CA, G.R. No. 159755, June 18, 2009).
Form of Written Notice
Article 1623 does not prescribe any particular form
of notice so long as the reasons for a notice are
present or otherwise satisfied as long as the
redemptioner is informed in writing of the sale and
the particulars thereof (DE LEON, supra at 574).
Actual Knowledge
GENERAL RULE: A written notice to co-owners is
mandatory notwithstanding actual knowledge of the
other co-owners of the sale (DE LEON, supra at
578).
EXCEPTION: In the case of Alonzo v. IAC, the Court
adopted an exception to the general rule, in view of
the “peculiar circumstances of this case” wherein the
co-heirs were undeniably informed of the sales
although no notice in writing was given them. The
30-day period began and ended during the 14 years
between the sales and the filing of the complaint for
redemption in 1977, without the co-heirs exercising
their right of redemption (G.R. No. 72873, May 28,
1987).
Contents of Written Notice of Sale
The notice, which Article 1623 of the Civil Code
requires to be made, is a notice not only of a
perfected sale but of the actual execution and
delivery of the deed of sale. This is implied from the
second sentence of Art.1623 of the Civil Code (DE
LEON, supra at 576).
There is no prescribed form for an offer to redeem to
be properly effected. What is paramount is the use
of the fixed and definite period within which to
exercise the right of legal redemption (Lee Chuy
Realty Corporation v. CA, G.R. No. 104114,
December 4, 1995).
Basis and Nature of the Right of Legal
Redemption
Source of the right proceeds from the law, which
creates it. However, it may be converted into one of
conventional redemption (DE LEON, supra at 548).
It is not predicated on proprietary right but on a bare
statutory privilege to be exercised only by the person
named in the statute. The statute does not make
actual ownership at the time of sale or redemption a
condition precedent, the right following the person
and not the property (Magno v. Viola and Sotto, G.R.
No. 37521, December 22, 1934).
Legal redemption is in the nature of a privilege
created partly for a reason of public policy and partly
for the benefit and convenience of the redemptioner.
It is intended to minimize co-ownership, the latter
being not favored by law (DE LEON, supra at 549).
CONVENTIONAL REDEMPTION
V. LEGAL REDEMPTION
CONVENTIONAL LEGAL
As to Constitution
By express reservation in Does not have to be
a contract of sale at time expressly reserved
of perfection. and covers sales and
other “onerous
transfers of title.”
As to Who May Exercise the Right
In favor of the seller. Given to a third party
to the sale.
As to the Effect of its Exercise
Extinguishes the Actually constitutes a
underlying contract of new sale in substitute
sale as though there was of the original sale.
never any contract at all.
(VILLANUEVA, supra at 506-507).
PRE-EMPTION V. REDEMPTION
PRE-EMPTION REDEMPTION
As to Time of Exercise of Right
Arises before sale. Arises after sale.

PRE-EMPTION REDEMPTION
Remedy of Rescission
No rescission because There can be
the sale does not yet rescission of the
exist. original sale.
Against Whom the Action is Directed
The action is directed Action is directed
against the prospective against the buyer.
seller.
(DE LEON, supra at 564).
INSTANCES OF LEGAL REDEMPTION:
1. Under the Civil Code:
a. Sale of a Co-owner of His Share to A
Stranger (CIVIL CODE, Art. 1620)
Requisites: (BRACES)
i. The sale must be Before partition (DE
LEON, supra at 555);
NOTE: The basis of the right of legal
redemption is the status of an owner
(Butte v. M. Uy & Sons, Inc., G.R. No. L-
15499, February 28, 1962).
ii. The vendee must be Reimbursed for the
price of the sale (DE LEON, supra at
555);
iii. There must be Alienation of all or any of
the shares of the co-owners (Id.);
iv. There must be subsisting Co-
ownership;
PURPOSE: The rule proceeds on the
theory that the privilege conferred upon
the co-owner to redeem is intended to
facilitate the termination of ownership in
common, which may be an obstacle in
the development of property, of industry
and of wealth, and to consolidate the
dominion in a sole owner (Magno v.
Viola and Sotto, G.R. No. 37521,
December 21, 1934).
v. The right must be Exercised within the
period provided in Art. 1623 of the Civil
Code (DE LEON, supra at 555); and
vi. The sale must be made to a Stranger,
(i.e., anyone who is not a co-owner).
NOTE: The right of redemption may be
exercised by a co-owner only when part
of the community property is sold to a
stranger; where it is sold to another co-
owner, the right does not arise because
a new participant is not added to the
ownership (Fernandez v. Tarun, 391
SCRA 653 (2002).
Price of Redemption
Generally, it is the purchase price paid by
the owners to the selling co-owner(s) (DE
LEON, supra at 558).
If the price is grossly excessive, the
redemptioner shall pay only a reasonable
one. This is to prevent collusion between the
purchaser and the selling co-owner. The
payment of reasonable price requires tender
of payment and consignation of the price,
independently of the size of the
redemptioner’s share in the co-owned
property (PINEDA, Sales, supra at 390).
The co-owners may only exercise
redemption in proportion to the share they
may respectively have (CIVIL CODE, Art.
1620, par. 2).
The right of redemption of co-owners
excludes that of adjoining owners (CIVIL
CODE, Art. 1623, par.2).
Illustration of Legal Redemption between
Co-owners: A, B and C are co-owners of an
undivided property valued at Php 50,000. A
sells his interest to D for P20,000. B or C
may exercise the right of redemption by
reimbursing D of the price of the sale. If both
B and C redeem the interest sold by A, each
of them shall pay P10,000 to D which is the
proportion of their respective shares in the
co-ownership. If the price of P20,000 is
grossly excessive, the same may be
equitably reduced by the courts (DE LEON,
supra at 555-556).
Art. 1620 Does NOT Apply When:
i. The thing owned in common had been
partitioned, judicially or extra-judicially;
ii. The shares of all co-owners are sold; or
iii. The thing owned in common had been
offered for sale by co-owners (DE
LEON, supra at 557-558).
b. Sale of Adjacent Rural Lands Not
Exceeding One (1) Hectare
Requisites: (RATE-OS)
i. Both the land of the one exercising the
right of redemption and the land sought
to be redeemed must be Rural;
A rural land refers to a land adapted and
used for agricultural or pastoral
 purposes. It is principally used for the
purpose of obtaining products from the
soil (DE LEON, supra at 561).
The intention of the law is the promotion
and protection of agriculture by the
union of small agricultural lands under
one owner for better exploitation of the
two lands (Fabia v. Intermediate
Appellate Court, G.R. No. L-66101,
November 21, 1984).
ii. The lands must be Adjacent;
iii. There must be alienation in favor of a
Third person, not in favor of another
adjacent owner;
PURPOSE: To prevent the passing of
the land to the hands of strangers
whose possession over the same will
not be for public welfare (Del Pilar v.
Catindig, G.R. No. 10432, November 4,
1916).
iv. The piece of rural land alienated must
not Exceed one hectare (10,000 square
meters) in area;
PURPOSE: To prevent the creation of
big landed estates (10 Manresa 372).
v. The vendee must already Own some
rural land; and
vi. The rural land sold must not be
Separated by brooks, drains, ravines,
roads and other apparent servitudes
from the adjoining land.
In case two (2) or more adjacent owners
desire to exercise the right of redemption,
the law gives preference to the owner of the
adjoining land of smaller area but if both
lands have the same area, to the one who
first requested to redeem (CIVIL CODE, Art.
1621, par. 3).
PURPOSE: To encourage the maximum
development and utilization of agricultural
lands (Ortega v. Orcine, G.R. No. L-28317,
March 31, 1971).
c. Sale of Adjoining Owners of Urban Land
Requirements for the exercise of the right of
pre-emption or redemption of urban lands:
1. The one exercising the right must be an
adjacent owner;
PURPOSE: To discourage speculation in
real estate and consequent aggravation
of the housing problems in centers of
population (DE LEON, supra at 569).
2. The piece of land is urban;
3. The land sold must be so small and so
situated that major portion thereof cannot
be used for any practical purpose within
reasonable time;
4. It was bought mere merely for
speculation; and
5. The land is about to be resold, or that its
resale has been perfected (CIVIL CODE,
Art. 1622).
Preference as Between Two (2) or More
Adjacent Owners
The owner whose intended use of the land
in question appears best justified shall be
preferred (CIVIL CODE. Art. 1622, par. 3).
Urban Lands
Their purpose or being for dwelling, industry
or commerce, and not for agricultural,
fishing, or timber exploration (DE LEON,
supra at 567).
It refers to the character of community or
vicinity in which it is found. Even if land is
somehow dedicated to agriculture, it is still
urban if it is located within the center of the
population or more or less portion of a city or
town (Ortega v. Orcine, G.R. No. L-28317,
March 31, 1971).
Meaning of “to Speculate”
To engage in a hazardous business
transaction for the chance of an unusually
large profit (DE LEON, supra at 568).
d. When A Credit or Other Incorporeal Right
in Litigation is Sold
Requisites: (SAD-P2E)
i. There must be a Sale or Assignment of
a credit or other incorporeal right;
ii. The assignee must have Demanded
payment from the debtor;
iii. The credit or right must be the subject of
a Pending litigation at the time of its
assignment or sale, i.e. that an answer
to the complaint is already filed;
iv. The debtor must Pay the assignee:
1.) the price paid;
2.) judicial costs; and
3.) interest on the price from the date of
payment;
v. The right must be Exercised by the
debtor within thirty (30) days from the
date the assignee demands (judicially or
extrajudicially) payment from him (CIVIL
CODE, Art. 1634; Id. at 601).
 Purpose of Grant of Right to Debtor
Gives an advantage to the debtor because
he will pay less than the value of the credit
assigned if he exercises his right to redeem
the same. To avoid the purchase by the third
person of credits in litigation merely for
speculation (DE LEON, supra at 601).
EXCEPTIONS:
i. Sale to a co-heir or co-owner of the right
assigned;
REASON: The law does not favor co-
ownership (DE LEON, supra at 604).
ii. Sale to a creditor in payment of his
credit; or
Presumption: The assignee cannot be
considered as vendee of a right in
litigation and as a speculator. It really
refers to a dation in payment (Id. at 605).
iii. Sale to the possessor of property in
question.
PURPOSE: to presumably preserve the
tenement, and not to speculate at the
expense of the debtor (Id. at 605; CIVIL
CODE, Art. 1635).
e. Sale of an Heir of His Hereditary Rights
to a Stranger
Should any of the heirs sell his hereditary
rights to a stranger before partition, any or
all of the co-heirs may be subrogated to the
rights of the purchaser by reimbursing him
for the price of the sale within one (1) month
from the time they were notified in writing of
the sale by selling co-heir (CIVIL CODE, Art.
1088).
The right of legal redemption applies only to
the sale by an heir of his hereditary right, it
doesn’t apply to sale of estate property (Plan
v. IAC, G.R. No. L-65656, February 28,
1985).
When the subject matter was a particular
property and not hereditary right, the
redemption by co-owner redounds to the
benefit of all other co-owners; while
redemption by a co-heir is only for his own
account.
2. Under Special Laws:
a. Equity of Redemption in cases of
Judicial Foreclosures
The right must be exercised within a period
of not less than ninety (90) days nor more
than one hundred twenty (120) days after
entry of judgment or even after the
foreclosure sale but prior to confirmation of
sale (GSIS v. Court of First Instance of Iloilo,
Branch III, G.R. No. L-45322, July 5, 1989).
b. Right of Redemption in cases of Extra-
Judicial Foreclosures
The right must be exercised within one (1)
year from and after the date of sale and
registration of the certificate of sale (Lee
Chuy Realty Corp. v. CA, G.R. No. 104114,
December 4, 1995).
The execution of dacion en pago by sellers
effectively waives the redemption period
normally given by the mortgagor (First
Global Realty and Development Corp v. San
Agustin, G.R. No. 144499, February 19,
2002).
c. Redemption of Homesteads
Conveyance of land acquired under free
patent homestead provisions shall be
subject to repurchase within five (5) years
from the date of conveyance (PUBLIC
LAND ACT, Sec. 117).
d. Redemption in tax sales
The delinquent taxpayer may exercise the
right within one (1) year from the date of sale
(NATIONAL INTERNAL REVENUE CODE,
Sec. 214).
e. Redemption by an agricultural tenant of
land sold by the landowner
The agricultural lessee has the right to
redeem within one hundred eighty (180)
days from notice in writing (AGRARIAN
REFORM CODE, Sec. 12).
f. Redemption in foreclosure by rural
banks (R.A. 720)
If the land is mortgaged to a rural bank,
mortgagor may redeem within two (2) years
from the date of foreclosure or from the
registration of the sheriff’s certificate of sale
at such foreclosure if the property is not
covered or is covered, respectively, by
Torrens Title. If the mortgagor fails to
exercise such right, he or his heirs may still
repurchase within five (5) years from
expiration of the 2-year redemption period
pursuant to section 119 of the Public Land
Act (Rural bank of Davao City v. CA, G.R.
No. 83992, January 27, 1993).
 CONTRACT OF SALE V.
ASSIGNMENT OF ASSIGNMENT OF CREDIT
CREDIT CONTRACT OF ASSIGNMENT OF
SALE CREDITS

As to Object
An agreement by virtue of which the owner of a
credit (known as the assignor), by a legal cause - Property (PNB v. CA, Credit, incorporeal rights
such as sale, dation in payment or exchange or G.R. No. 11681, or rights of action (PNB
donation - and without need of the debtor's consent, January 6, 1997). v. CA, supra).
transfers that credit and its accessory rights to
another (known as the assignee), who acquires the As to Manner of Delivery of Object
power to enforce it, to the same extent as the
Need not be through a Public instrument (CIVIL
assignor could have enforced it against the debtor.
public instrument CODE, Art. 1625).
(Far East Bank & Trust Company v. Diaz Realty,
(CIVIL CODE, Art.
Inc., G.R. No. 138588. August 23, 2001)
1497).
NATURE OF ASSIGNMENT OF CREDIT As to the Person/s Obligated
1. Consensual, bilateral, onerous, and
commutative or aleatory contract (DE LEON, Whole world Definite third person
supra at 588); (VILLANUEVA, supra at
2. The assignment involves no transfer of 573)
ownership but merely effects the transfer of
rights which the assignor has at the time to the As to When Ownership is Transferred
assignee (Casabuena v. CA, G.R. No. 115410,
Transfer of ownership Ownership is transferred
February 27, 1998);
need not be upon upon delivery of the
3. It may be done onerously (i.e., exchange, dacion
delivery of the thing. documents evidencing
en pago) or gratuitously (i.e., donation) (DE
The parties may agree the credit or incorporeal
LEON, supra at 589); and
that ownership be rights (constructive
4. As a general rule, all principles governing sales
transferred only after delivery) (VILLANUEVA,
also applicable to this transaction. The act of
full payment (CIVIL supra at 576).
assignment cannot operate to erase liens or
CODE, Art. 1478).
restrictions burdening the right assigned
(Gonzales v. Land Bank of the Philippines, G.R. As to the Consideration
No. 76759, March 22, 1990).
It is always a requisite Not always a requisite.
PERFECTION OF CONTRACT FOR (PNB v. CA, supra). Action may be
ASSIGNMENT OF CREDIT (CIVIL CODE, Art. maintained by the
1624) assignee based on his
The contract is perfected from the moment the title even if there is no
parties agree upon the credit or right assigned and consideration (PNB v.
upon the price even if neither has been delivered CA, supra).
(CIVIL CODE, Art. 1475). However, the assignee will (PINEDA, Sales, supra at 408).
acquire ownership only upon delivery (CIVIL CODE,
Arts. 1498, par. 2 and Art. 1501).
EFFECTS OF ASSIGNMENT
Consent of Debtor Not Necessary 1. It transfers the right to collect the full value of the
In an assignment of credit, the consent of the debtor credit, even if he paid a price less than such
is not necessary in order that the assignment may value; and
fully produce the legal effects (DE LEON, supra at
590). 2. It transfers all the accessory rights (e.g.
guaranty, mortgage, or preference) (CIVIL
REASON: Otherwise, all creditors would be CODE, Art. 1627);
prevented from assigning their credits because of
the possibility of the debtor’s refusal to give consent NOTE: If the period for payment has been
(Rodriguez v. CA, G.R. No. 84220 March 25, 1992). extended without the consent of the guarantor,
the assignee cannot go after the former
because, as to him his guaranty is only up to the
original period.

Illustration: A obtained a loan (P100,000) from
B. To secure the payment of loan, C mortgaged
his property to B. B assigned his credit owing
from A to D. A failed to pay the loan. D can
foreclose the mortgage because being an
accessory right, it is deemed included in the
assignment.
3. Debtor can set up against the assignee all the
defenses he could have set up against the
assignor (Koa v. CA, G.R. No. 84847, March 5,
1998); and
4. Assignee cannot go after the assignor to enforce
the credit if through his own negligence he
allowed the credit to prescribe provided the
assignee was given enough time to enforce the
said credit.
Illustration: A lends money to B on March 30, 2009.
A then assigned the credit to C on April 30, 2009. C
demanded payment from B only on May 30, 2019.
For ten years, C cannot collect from B since the loan
has already prescribed; neither can he collect from
A (the assignor) - he cannot through his own
negligence, (and considering he was given enough
time to enforce the credit) go after the assignor if he
cannot anymore collect from the debtor.
ENFORCEABILITY AGAINST THIRD
PERSONS:
1. As between the parties, the assignment is valid
although it appears only in a private document
so long as the law does not require a specific
form for its validity (CIVIL CODE, 1356).
2. If the assignment involves credit, right or action,
a public instrument is needed to make the
assignment effective against third persons.
3. If real property is involved, recording in the
Registry of Property would be needed (CIVIL
CODE, Art. 1625).
EFFECT OF PAYMENT BY THE DEBTOR
AFTER THE ASSIGNMENT OF CREDIT:
1. Before notice of the assignment
– Payment to the original creditor is valid and
debtor shall be released from his obligation
(CIVIL CODE, Art. 1626); or
2. After notice of the assignment
– Payment to the original creditor is not valid as
against the assignee. He can be made to pay
again by the assignee (DE LEON, supra at 593).
3. Even without notice but with knowledge
– Even without notice, the debtor will not be
released from his obligation should he pay the
creditor after having had knowledge of the
assignment of the obligation. He thereby acts in
bad faith (DE LEON, supra at 594)
WARRANTIES OF THE ASSIGNOR OF
CREDIT: (LES)
1. The Legality and Existence of the credit at the
time of sale unless he sold it as doubtful, (i.e.,
he is not sure of the validity of his acquisition of
the thing sold which fact he has disclosed to the
assignee);
2. The Solvency of the debtor, if expressly
stipulated, or if the insolvency of the debtor was
prior to the sale and of common knowledge
(CIVIL CODE, Art. 1628, par.1).
LIABILITIES OF THE ASSIGNOR OF
CREDIT FOR VIOLATION OF HIS
WARRANTIES:
1. Assignor in Good Faith
– Liability is limited only to the price received and
to the expenses of the contract, and any other
legitimate payments by reason of the
assignment (CIVIL CODE, Art. 1628, par. 2);
2. Assignor in Bad Faith
– Liable not only for the payment of the price and
all the expenses but also for damages (CIVIL
CODE, Art. 1628, par. 3).
DURATION OF ASSIGNOR’S LIABILITY
WHERE DEBTOR’S SOLVENCY
GUARANTEED (CIVIL CODE, Art. 1628)
This provision does not apply if the assignor acted in
bad faith.
The duration of the assignor’s liability as follows:
1. If there is a stipulation, then for the term or
period fixed;
2. If there is no stipulation:
a. One (1) year from the assignment of credit -
when the period for payment of the credit
has expired; or
b. One (1) year after its maturity – when such
period for payment has not expired.
Reasons for the Rule:
1. To prevent fraud which may be committed by
feigning the solvency of the debtor at the time of
the assignment when in fact he is solvent; and
2. To oblige the assignee to exert efforts in the
recovery of the credit and thereby avoid by his
oversight, the assignor may suffer (DE LEON,
supra at 597).
SALE OF SUCCESSIONAL OR
HEREDITARY RIGHTS BARTER
One who sells an inheritance without enumerating (ARTS. 1638-1641)
the things of which it is composed, shall only be
answerable for his character as an heir (CIVIL
CODE, Art. 1630).
BARTER
This refers to the sale of successional right or the
A contract whereby one of the parties binds himself
right to an inheritance before partition (DE LEON,
to give one thing in consideration of the other’s
supra at 597).
promise to give another thing (CIVIL CODE, Art.
1638).
While an heir may sell his hereditary right before
partition, the law prohibits the sale of a future
It is similar to a sale with the only difference that
inheritance, upon which no contract can be made
instead of paying a price in money, another thing is
other than those making a division inter vivos of an
given in lieu thereof (DE LEON, supra at 610).
estate in accordance with Article 1347 of the Civil
Code (Id.).
A contract whereby one person transfers the
ownership of non-fungible things to another with the
WARRANTIES OF SELLER obligation on the part of the latter to give things of
The seller of hereditary rights warrants only the fact the same kind, quantity, and quality (CIVIL CODE,
of heirship but does not warrant the objects which Art. 1954).
make up his inheritance (Id. at 598).
PERFECTION AND CONSUMMATION OF
Illustration: H and I are the heirs of the estate left
by D, deceased. Before partition and without
THE CONTRACT
specifying his definite share in the inheritance, H Perfected from the moment there is meeting of
sold his share to B for P100,000. In this case, H only minds upon the things promised by each party in
warrants the fact the he is an heir to D. He is not consideration of the other (CIVIL CODE, Art. 1475).
liable to B should his share after the partition be less
than P100,000 (Id.). Consummated from the time of mutual delivery by
the contracting parties of the things promised
(Tagaytay Development Corp. v. Osorio, G.R. No. L-
SALE OF WHOLE OF CERTAIN RIGHTS, 46069, November 16, 1939).
RENTS OR PRODUCTS
The vendor warrants only the legitimacy of the whole RULES GOVERNING BARTER:
and not the various parts of which it may be
1. Where the giver of the thing bartered is not the
composed. The vendor is not liable for eviction of the
lawful owner thereof, the aggrieved party cannot
various parts unless the eviction involves the whole
be compelled to deliver the thing which he has
or part of a greater value (CIVIL CODE, Art. 1631).
promised. He is also entitled to damages (CIVIL
CODE, Art. 1639).
LIABILITY OF VENDOR OF 2. Where a party is evicted of the thing exchanged,
INHERITANCE FOR FRUITS RECEIVED the injured party is given the option, either to
Should the vendor have profited by some of the fruits recover the property he has given in exchange
or received anything from the inheritance sold, he with damages or claim an indemnity for
shall pay the vendee thereof, if the contrary has not damages. The right to recover is subject to the
been stipulated (CIVIL CODE, Art. 1632). rights of innocent third persons (CIVIL CODE,
Arts. 1640 and 1385).
LIABILITY OF VENDEE FOR DEBTS OF 3. As to matters not provided for by the provisions
on barter, the provisions on Sales will apply
AND CHARGES ON ESTATE
suppletorily (CIVIL CODE, Art. 1641)
The vendee, on his part, reimburse the vendor for all
that the latter may have paid for the debts of and
charges on the estate and satisfy the credits he may
have against the same, unless there is an
agreement to the contrary (CIVIL CODE, Art. 1633).

RECTO LAW
It provides for remedies of a vendor in the sale of
personal property by installments (CIVIL CODE, Art.
1534; VILLANUEVA, supra at 345).
SALE ON INSTALLMENT
When there is an initial payment and the balance is
payable in the future, there is no basis to apply the
Recto Law. Such is not a sale on installments but
rather a “straight sale”. Under the language of then
Article 1454 (now 1484) of the Civil Code, the buyer
needs to have defaulted in the payment of two or
more installments to allow the seller to rescind or
foreclose on the chattel mortgage (Levy Hermanos,
Inc. v. Gervacio, G.R. No. L-46306, October 27,
1939).
NOTE: Provisions on Chattel Mortgage was already
repealed.
PURPOSE OF THE RECTO LAW
To remedy the abuses committed in connection with
the foreclosure of chattel mortgages and was meant
to prevent mortgagees from seizing the mortgaged
property, buying it at foreclosure sale for a low price
and then bringing suit against the mortgagor for a
deficiency judgment (Universal Motors Corp. v. Dy
Hian Tat, G.R. No. L-23788, May 16, 1969).
Requisites: (SPIF)
1. Contract of Sale;
2. Personal property;
3. Payable in Installments; and
4. In the case of the second and third remedies,
that there has been a Failure to pay two or more
installments (CIVIL CODE, Art. 1484).
NOTE: Art. 1484 applies to contracts purporting to
be leases of personal property with option to
buy, when the lessor has deprived the lessee of the
possession or enjoyment of the thing (CIVIL CODE,
Art. 1485) i.e. where a lease agreement is in reality
a lease with an option to purchase an equipment
to which Article 1485 applies (PCI Leasing &
Finance, Inc. v. Giraffe- X Creative Imaging Inc., July
12, 2007).
PURPOSE: To prevent vendors from resorting to
this form of contract which usually is in reality a
contract of sale of personal property payable in
installment in contravention of the provisions of
Article 1484 (DE LEON, supra at 179).
The vendor by retaining ownership over the property
in the guise of being the lessor, retains likewise the
right to possess the same, without going through the
process of foreclosure, in the event the vendee-
lessee defaults in the payment of the installment.
There arises no need to constitute a chattel
mortgage over the immovable sold (Filinvest Credit
Corp. v. CA, G.R. No. 82508, September 29, 1989).
Repossession by the Lessor Need Not be
through Court Action
If the lessee-buyer does so in obedience to the
lessor’s demand or where the contract specifically
authorizes the lessor-seller to repossess the
property whenever the lessee-buyer defaults in the
payment of rent (U.S. Commercial Co. v. Halili, G.R.
No. L-5535, May 29, 1953).
Article 1484 of the Civil Code, which governs the
sale of personal properties in installments which
gives the vendee the remedies, applies only when
there is a vendor-vendee relationship between the
parties and not a debtor-mortgagor and creditor-
mortgagee. A judicious perusal of the records would
reveal that respondent never bought the subject
vehicle from petitioner but from a third party, and
merely sought financing from petitioner for its full
purchase price. Since it is undisputed that petitioner
had regained possession of the subject vehicle, it is
only appropriate that foreclosure proceedings, if
none yet has been conducted/concluded, be
commenced in accordance with the provisions of Act
No. 1508, otherwise known as "The Chattel
Mortgage Law," as intended (Equitable Savings
Bank v. Palces, G.R. No. 214752, March 3, 2016).
Art. 1484 of the Civil Code does NOT apply to:
1. Sale of personal property payable in straight
terms (partly in cash and partly in one term)
(Levy Hermanos, Inc. v. Gervacio, G.R. No. L-
46306, October 27, 1939);
2. Sale or mortgage of real estate;
3. Action for replevin;
4. Contracts to sell on movables. In this case, the
rules on rescission and substantial breach are
not applicable (VILLANUEVA, supra at 381).
ALTERNATIVE AND EXCLUSIVE
REMEDIES
The remedies under Article 1484 of the Civil Code
have been recognized as alternative, not
cumulative, in that the exercise of one would bar the
exercise of the others (Delta Motors Sales Corp. v.
Niu Kim Duan, G.R. No. 61043, September 2, 1992).
NOTE: The remedies cannot also be pursued
simultaneously. Availment of all the remedies is
irregular and flagrant circumvention of the
prohibition of the law (Luneta Motor Co. v. Dimagiba,
G.R. No. L-17061, December 30, 1961).
1. Specific Performance upon Vendee’s
Failure to Pay
The vendor may, after obtaining favorable
judgment from the court, cause the sheriff to levy
on the thing sold and have it sold at a public
auction. If the proceeds of the sale were not
enough, the vendor may cause an alias of writ of
execution to be issued on the other properties of
the vendor (DE LEON, supra at 157).
In sales on installments, where the action
instituted is for specific performance and the
mortgaged property is subsequently attached
and sold, the sale thereof does not amount to a
foreclosure of the mortgage, hence, the seller-
creditor is entitled to a deficiency judgment
(Southern Motors Inc. v. Moscoso, G.R. No. L-
14475, May 30, 1961).
When Deemed Chosen
The seller is deemed to have chosen specific
performance when he files an action in court for
recovery (VILLANUEVA, supra at 355).
Resort to Rescission after Choosing Specific
Performance
GENERAL RULE: When the seller has chosen
specific performance, he can no longer seek for
rescission or foreclosure of the chattel mortgage
constituted on the thing sold (VILLANUEVA,
supra at 355).
EXCEPTION: Even if the seller had chosen
specific performance, if the same has become
impossible, the seller may still choose rescission
(CIVIL CODE, Art. 1191, par. 2).
2. Rescission of the Sale if Vendee shall
have Failed to Pay Two (2) or More
Installments When Deemed Chosen
When the seller has clearly indicated to end the
contract such as when: (NPA)
a. He sends a Notice of rescission;
b. He takes Possession of the subject matter
of the sale; or
c. He files an Action for rescission
(VILLANUEVA, supra at 387).
Forfeiture of Installment or Rentals Paid
GENERAL RULE: Rescission creates the
obligation to return the things which were the
object of the contract, together with the fruits,
and the price with its interests. It can be carried
out only when he who demands rescission can
return whatever he may be obliged to restore
(CIVIL CODE, Art. 1385).
EXCEPTION: A stipulation that the installments
or rents paid shall not be returned to the vendee
or lessee shall be valid insofar as the same may
not be unconscionable under the circumstances
(CIVIL CODE, Art. 1486). Otherwise, the court
has the power to order the return of the portion
of the total amount paid in installments or rent
(DE LEON, supra at 181).
It is recognized that when the seller takes
possession of the subject property in rescission
of the sale, the seller is barred from recovering
the balance of the price. Although no barring
effect is expressly provided for such remedy
under Article 1484, the same is implicit from the
nature of the remedy of rescission, which
requires mutual restitution (VILLANUEVA, supra
at 388).
3. Foreclosure of the Chattel Mortgage
Constituted on the Thing Sold if Vendee
shall have failed to Pay Two (2) or More
Installments
In this case, there shall be no deficiency
judgment (CIVIL CODE, Art. 1484, par. 3).
When Deemed Chosen
At the time of actual sale of the subject property
at public auction pursuant to the foreclosure
proceedings commenced (Manila Motor Co.,
Inc. v. Fernandez, G.R. No. L-8377, August 28,
1956).
Barring Effect of Foreclosure
It is the foreclosure and actual sale at public
auction of the mortgaged chattel that shall bar
further recovery by the seller of any balance on
the purchaser’s outstanding obligation not
satisfied by the sale prior to that point in time,
the seller has every right to receive payments on
the unpaid balance of the price from the buyer
(Manila Motor Co., Inc. v. Fernandez, G.R. No.
L-10910, January 16, 1959; VILLANUEVA,
supra at 390-391).
Any agreement allowing for further action to
recover unpaid balance is void (CIVIL CODE,
Art. 1484, par. 3).
NOTE: Article 1484 (3) is inapplicable where the
amounts adjudged in favor of the vendor-
mortgagee were not part of unpaid balance of
the purchase price or in the concept of a
deficiency but were expenses of the suit
(Universal Motors Corp. v. Velasco, G.R. No. L-
25140, July 15, 1980).
Recoverable expenses would include expenses
properly incurred in effecting seizure of the
chattel and attorney’s fees in prosecuting the
action for replevin (Agustin v. CA, G.R. No.
107846, April 18, 1997).
 The mere fact that the seller secures the
possession of the personal property through an
attachment after filing an action for collection of
the unpaid balance, with a prayer for an
issuance of a writ of preliminary attachment
does not necessarily mean that he intends to
resort to a foreclosure of the mortgage (Palma
v. CA, G.R. No. 45158, June 2, 1994).
Prior to foreclosure and actual sale at public
auction, the seller has every right to receive
payments on the unpaid balance of the price
from the buyer (Sps. Rosario v. PCI Leasing and
Finance, G.R. No. 139233, November 11,
2005).
Payments made before actual foreclosure could
be retained by the vendor (Northern Motors, Inc.
v. Sapinoso, G.R. No. L-28074, May 29, 1970).
The following situations were not considered
as having “exercised” the remedy of
foreclosure because of its incomplete
implementation:
a. The seller merely informed purchaser of
intention to foreclose and did not actually
foreclose (Radiowealth, Inc. v. Lavin, G.R.
No. L-18563, April 27, 1963).
b. Mere demand for surrender of thing sold but
no foreclosure (Tobias Industrial Finance
Corp. v. Tobias, G.R. No. L-41555, July 27,
1977).
c. Action for replevin (Universal Motors Corp.
v. Velasco, G.R. No. L-25140, July 15,
1980).
d. Action for specific performance (Southern
Motors, Inc. v. Moscoso, G.R. No. L-14475,
May 30, 1961).
e. Vendor given possession by vendee did not
foreclose (Filinvest Credit Corp. v. Phil
Acetylene Co., Inc. G.R. No. L-50449,
January 30, 1982).
f. Seller filed petition for extrajudicial
foreclosure and obtained possession but did
not foreclose (De la Cruz v. Asian Consumer
& Industrial Finance Corp., G.R. No. 94828,
September 18, 1992).
g. Thing not sold at public auction as it was
released by sheriff (Pacific Commercial Co.
v. De La Rama, G.R. No. L-47771, June 17,
1941).
BARRING EFFECT ON OTHER
SECURITIES GIVEN FOR PAYMENT OF
PRICE
After foreclosure, the vendor cannot proceed against
any third party who may have guaranteed the
vendee’s performance of his obligation, for if the
guarantor should be compelled to pay the balance,
the guarantor will be entitled to recover what he has
paid from the debtor-vendee, so that ultimately, it will
be the vendee who will be made to bear the payment
of the balance of the price (Cruz v. Filipinas
Investment & Finance Corp., G.R. No. L-24772, May
27, 1968).
The word “action” is referring to any judicial or extra-
judicial proceeding by virtue of which the vendor may
lawfully satisfied balance of the purchase price from
the purchaser or his privy (Cruz v. Filipinas
Investment & Finance Corp., G.R. No. L-24772, May
27, 1968).
SELLER’S ASSIGNMENT OF CREDIT
When the seller assigns his credit to another person,
the same law likewise binds the latter. Accordingly,
when the assignee forecloses on the mortgage,
there can be no further recovery of the deficiency
and the seller-mortgagee is deemed to have
renounced any right thereto. To rule otherwise would
pave the way for subverting the policy under Article
1484 (Borbon II v. Servicewide Specialists, Inc.,
G.R. No. 106418, July 11, 1996).
Art. 1484 (3) of the Civil Code does not bar one to
whom the vendor has assigned on a with recourse
basis his credit against the vendee from recovering
from the vendor the assigned credit in full although
the vendor may have no right of recovery against the
vendee for the deficiency (Filipinas Investment &
Finance Corp. v. Vitug, Jr., G.R. No. L-25951, June
30, 1969).
EXTENT OF BARRING EFFECT
Despite the limiting language of Article 1484 of the
Civil Code, which uses the phrase “any unpaid
balance,” the Supreme Court, in Macondray & Co.,
Inc. v. Eustaquio, ruled that the barring effect also
applies to all other claims (e.g., the interest on the
principal, attorney’s fees, expenses of collection,
and the costs) (G.R. No. L-43683, July 16, 1937).
PERVERSE BUYER-MORTGAGOR
When a defaulting buyer-mortgagor refuses to
surrender the chattel to the seller to allow the latter
to be able to proceed with foreclosure, then the
seller, even after foreclosure, should be allowed to
recover expenses and attorney’s fees incurred in
trying to obtain possession of the chattel (Filipinas
Investment & Finance Corp, v. Ridad, G.R. No. L-
27645, November 28, 1969). In effect, the Ridad,
Universal Motor Corp. and Agustin ruling provides
an exception to the complete barring effect
espoused in Macondray & Co., Inc. ruling.

MACEDA LAW
(R.A. NO. 6552)
PURPOSE
It is an expression of public policy to protect buyers
of real estate on installments against onerous and
oppressive conditions (R.A. 6552, Sec. 2).
COVERAGE
Transactions or contracts involving sale or financing
of real estate on installment payments including
residential condominium apartments (R.A. 6552,
Sec. 3).
IT DOES NOT APPLY TO:
1. Sale covering industrial lots;
2. Sale covering commercial buildings (and
commercial lots by implication);
3. Sale to tenants under agrarian reform laws; or
4. Sale of lands payable in straight terms (R.A.
6552, sec. 3).
It is clear that the buyer's protection under R.A. No.
6552 only applies to contracts of sale of real estate
on installment payments, including residential
condominium apartments, but excluding industrial
lots, commercial buildings and sales to tenants. A
purchase by a company involved in the real estate
business of a six-hectare lot can hardly be
considered as residential (Royal Plains View v.
Meija, G.R. No. 230832. November 12, 2018).
The enumeration of the transactions not covered by
the Maceda Law is NOT exclusive, since other
transactions over immovables, although not within
the enumerated exclusions are to be considered
excluded. An example would be the sale on
installment of commercial condominium units
(VILLANUEVA, supra at 384).
NOTE: Section 3 of the Maceda Law is
comprehensive enough to include both contracts of
sale and contracts to sell, provided that the terms of
the payment of the price require at least two
installments (Id. at 385).
Requisites:
1. Transactions or contracts involving the sale or
financing of real estate on installment payments,
including residential condominium apartments;
and
2. Buyer defaults in payment of succeeding
installments (R.A. 6552, Sec. 3).
SALE BY INSTALLMENTS
Its definition is the same for sale of movables by
installments, which would involve at least two (2)
installments (VILLANUEVA, supra at 382).
NOTE: While under Sec. 3, down payment is
included in computing the total number of installment
payments made, the proper divisor is the monthly
installment on the down payment (Jestra
Development and Management Corp. v. Pacifico,
G.R. No. 167452, January 30, 2007).
Maceda Law Cannot be availed of by the
Developer
The Maceda Law has no application to protect the
developer or one who succeeds the developer
(Lagandaon v. CA, G.R. Nos. 102526, May 21,
1998).
RIGHTS OF THE BUYER:
1. If the buyer has paid at least two (2) years of
installments:
a. The buyer must pay, without additional
interest, the unpaid installments due within
the total grace period earned by him. There
shall be one (1) month grace period for
every one (1) year of installment payments
made (R.A. 6552, Sec. 3).
NOTE: This right shall be exercised by the
buyer only once every five (5) years of the
life of the contract and its extensions (R.A.
6552, Sec. 3).
b. Actual cancellation can only take place after
thirty (30) days from receipt by the buyer of
the notice of cancellation or demand for
rescission by a notarial act and upon full
payment of the cash surrender value to the
buyer (R.A. 6552, Sec. 3; Olympia Housing
v. Panasiatic Travel Corp., G.R. No.
140468, January 16, 2003).
c. Cancellation of Contract
For a valid and effective cancellation of the
contract under the Maceda Law, the
mandatory twin requirements of a notarized
notice of cancellation and refund of the
cash surrender value must be complied with
(Gatchalian Realty Inc., v. Angeles, G.R.
No. 202358, November 27, 2013).
NOTE: The seller shall refund to the buyer
the cash surrender value of the payments on
the property equivalent to fifty percent (50%)
of the total payments made. After five (5)
years of installments, there shall be an
additional five percent (5%) every year but
 not to exceed ninety percent (90%) of the
total payments made (R.A. 6552, Sec. 3).
The right of the buyer to refund accrues only
when he has paid at least two years of
installments (Manuel Uy & Sons, Inc., v.
Valbueco, Inc., G.R. No. 179594,
September 11, 2013).
Cancellation of a contract to sell may be
done outside of court, however, the
cancellation by the seller must be in
accordance with Sec. 3 (b) of R.A. No. 6552.
Where the buyer has paid at least two years
of installments and in case he defaults in the
payment of succeeding installments, he is
entitled to the refund of the cash surrender
value of the payments on the property
equivalent to fifty per cent of the total
payments made, and after five years of
installments, an additional five per cent
every year but not to exceed ninety per cent
of the total payments made. Provided, that
the actual cancellation of the contract shall
take place after thirty days from receipt by
the buyer of the notice of cancellation or the
demand for rescission of the contract by a
notarial act and upon full payment of the
cash surrender value to the buyer
(Associated Marine Officers and Seamen’s
Union of the Philippines PTGWO-ITF v.
Decena, G.R. No. 178584; October 8,
2012).
d. The buyer shall have the right to sell his
rights or assign the same to another person
OR to reinstate the contract by updating the
account during the grace period and before
actual cancellation of the contract (R.A.
6552, Sec. 5).
e. The buyer shall have the right to pay in
advance any installment or the full unpaid
balance of the purchase price any time
without interest and to have such payment
annotated in the certificate of title covering
the property (R.A. 6552, Sec. 6).
2. If Buyer has paid less than two (2) years of
installments:
a. The seller shall give the buyer a grace
period of not less than sixty (60) days from
the date the installment became due. If the
buyer fails to pay the installments due at the
expiration of the grace period, the seller may
cancel the contract after thirty (30) days
from receipt by the buyer of the notice of
cancellation or the demand for rescission of
contract by a notarial act (R.A. 6552, Sec.
4).
b. The buyer shall have the right to sell his
rights or assign the same to another person
or to reinstate the contract by updating the
account during the grace period and before
the actual cancellation of the contract (R.A.
6552, Sec. 5).
c. The buyer shall have the right to pay in
advance any installment or the full unpaid
balance of the purchase price any time
without interest and to have such payment
annotated in the certificate of title covering
the property (R.A. 6552, Sec. 6).
NOTE: Section 4 of R.A. 6552 is the provision
applicable to buyers who have paid less than
two (2) years-worth of installments.
For buyers who have paid less than two (2)
years-worth of installments, the following
requisites must be satisfied:
a. The seller shall give the buyer a sixty (60)
day grace period to be reckoned from the
date the installment became due;
b. The seller must give the buyer a notice of
cancellation/demand for rescission by
notarial act if the buyer fails to pay the
installments due at the expiration of the said
grace period; and
c. The seller may actually cancel the contract
only after thirty (30) days from the buyer’s
receipt of the said notice of
cancellation/demand for rescission by
notarial act (Optimum Dev’t Bank v. Sps.
Jovellanos, G.R. No. 189145, December 04,
2013).
NOTE: Down payments, deposits or options on
the contract shall be included in the computation
of the total number of installment payments
made (R.A. 6552, Sec. 3).
When Republic Act No. 6552 or the Maceda Law
speaks of paying "at least two years of
installments" in order for the benefits under its
Section 3 to become available, it refers to the
buyer's payment of two (2) years' worth of the
stipulated fractional, periodic payments due to
the seller. When the buyer's payments fall short
of the equivalent of two (2) years' worth of
installments, the benefits that the buyer may
avail of are limited to those under Section 4.
Should the buyer still fail to make payments
within Section 4's grace period, the seller may
cancel the contract. Any such cancellation is
ineffectual, however, unless it is made through a
valid notarial act (Obre v. Filinvest Land, Inc.
G.R. No. 208185, September 6, 2017).
 The notice of cancellation accompanied by a
jurat is not the valid notarial act
contemplated by the Maceda Law
Notarization under the Maceda Law extends
beyond converting private documents into public
ones. Under Sections 3 and 4, notarization
enables the exercise of the statutory right of
unilateral cancellation by the seller of a
perfected contract. Through an
acknowledgement, individuals acting as
representatives declare that they are authorized
to act as such representatives. It is imperative
that the officer signing for the seller indicate that
he or she is duly authorized to effect the
cancellation of an otherwise perfected contract.
Respondent's notice of cancellation here was
executed by an individual identified only as
belonging to respondent's Collection
Department. A jurat is a distinct notarial act,
which makes no averment concerning the
authority of a representative (Obre v. Filinvest
Land, Inc. G.R. No. 208185, September 6,
2017).
LEASE
(ARTS. 1642-1679)
DEFINITION OF CONTRACT OF LEASE
A contract whereby one person (lessor) binds
himself to grant temporarily the enjoyment or use of
a thing or to render of some work or service to
another (lessee) who undertakes to pay some rent,
compensation or price therefor (DE LEON, supra at
703).
ESSENTIAL ELEMENTS OF A 1700 and 1732); and
CONTRACT OF LEASE
As in ordinary contract, a contract of lease has three
elements, namely: (COC)
1. Consent of the contracting parties;
2. Object certain which is the subject matter of the
contract; and
3. Cause of the obligation which is established
(CIVIL CODE, Art. 1318)
CHARACTERISTICS OF LEASE OF
THINGS:
1. Consensual;
Hence, as a rule, lease may be entered orally.
However, if the lease of real property is for more
than one (1) year, it must be in writing, in
compliance with Statue of Frauds (CIVIL CODE,
Art. 1403. par. 2, (e))
Issuance of the certificate by the city engineer's
office is not required for the perfection of a
contract of lease. Being a consensual contract,
a lease is perfected at the moment there is a
meeting of the minds upon the thing and the
cause or consideration which are to constitute
the contract (Hilltop Market Fish Vendors'
Association, Inc. v. Yaranon, G.R. No. 188057,
December 7, 2017).
2. Commutative;
3. Onerous (there must be rent or price certain);
4. Bilateral;
5. Principal; and
6. Nominate.
LEASE CONTRACT IS NOT
ESSENTIALLY PERSONAL IN
CHARACTER
GENERAL RULE: It survives the death of the parties
and continues to bind the heirs.
EXCEPTION: If the contract states otherwise
(Inocencion v. Hospicio de San Jose, G.R. No.
201787, September 25, 2013).
RULES ON TEMPORARY ENJOYMENT
OR USE
1. Period is either definite or indefinite (5 PARAS,
supra at 323-325)
2. However, in the lease of things, no lease for
more than 99 years shall be valid (CIVIL CODE,
Art. 1643)
KINDS OF LEASE AS TO THE SUBJECT
MATTER (CIVIL CODE, Art. 1642):
1. Lease of things (CIVIL CODE, Art. 1654);
2. Lease of service (CIVIL CODE, Arts. 1689,
3. Lease of work (CIVIL CODE, Art. 1713).
LEASE OF THINGS
One of the parties (lessor) binds himself to give to
another (lessee) the enjoyment or use of a thing for
a price certain, and for a period which may be
definite or indefinite. However, no lease for more
than ninety-nine (99) shall be valid (CIVIL CODE,
Art. 1643).
ESSENCE OF LEASE
The transmission of the temporary enjoyment or use
by the lessee of a thing for a certain period in
consideration of the undertaking to pay rent therefor
(DE LEON, supra at 705).
Hence, the object of lease must be within the commodatum (which is essentially gratuitous)
commerce of man (CIVIL CODE, Art. 1317); (CIVIL CODE, Art. 1933).
otherwise, it is void (Id.)
RIGHT TO FIX RENT
SUBJECT MATTER OF LEASE It belongs to lessor as lease is a consensual
Article 1643 applies to lease of things, whether contract, similar to sale. If the rentals being claimed
movable or immovable. are exorbitant, the courts could intervene as a matter
of fairness and equity. The burden of proof to show
The Civil Code makes no special provisions for the the unreasonableness of the rent is on the lessee
lease of movables. Nevertheless, the provisions of (Ramon Magsaysay Award Foundation v. CA, G.R.
the Code on leases of lands are also applicable to No. L-55998, January 17, 1985).
leases of personal property except those provisions
which by their nature and intent, can only be applied RIGHT TO INCREASE RENT
where the object of the lease is immovable (Id. at It is not an absolute right on the part of the lessor
706). without the consent of the lessee (Ramon
Magsaysay Award Foundation v. CA, G.R. No. L-
RULE FOR LEASE OF CONSUMABLE 55998, January 17, 1985). Neither can the court fix
GOODS a different rental, even where there is an increase in
GENERAL RULE: Consumable goods cannot be realty taxes (Ledesma v. Javellana, G.R. No. L-
the subject matter of a contract of lease of things 55187, April 28, 1983)
(CIVIL CODE, Art. 1645).
SALE v. LEASE
REASON: To use or enjoy them, they will have to be
CONTRACT OF SALE LEASE
consumed. This cannot be done in lease since
returning the thing is the essence of lease (CIVIL As to Nature of Obligation
CODE, Art. 1643).
Obligation to absolutely Obligation to transfer
EXCEPTIONS: transfer ownership the use of the thing
1. If they are merely to be exhibited; or (CIVIL CODE, Art. only (CIVIL CODE, Art.
2. If they are accessory to an industrial 1460). 1642).
establishment (CIVIL CODE, Art. 1645).
As to Consideration
OWNERSHIP OF THING
Consideration is price Consideration is rent
The lessor need not be the owner of the thing leased
(CIVIL CODE, (CIVIL CODE, Art.
as long as he can transmit its enjoyment or use to
Art.1473) 1642)
the lessee since the ownership is not being
transferred (Id.). As to Necessity of Owning the Object at the
Time of Transfer
Even the lessee himself may lease the property to
another; in such case, a sublease results (CIVIL Seller needs to be the Lessor need not be the
CODE, Art. 1650). owner of the thing to owner (DE LEON,
transfer ownership Sales, supra at 706).
CONSIDERATION OF LEASE (CIVIL CODE, Art.
RENT 1459).
It is the cause of the contract of lease, in money or
As to Significance of Price of Object
in its equivalent, such as products, fruits or other
useful things or some other prestation which the The price of the object, is The price of the thing is
lessee binds himself to undertake. The important is usually not mentioned usually fixed in the
that what have given by the lessee has value (DE (DE LEON, supra at contract (CIVIL CODE,
LEON, supra at 707). 720). Art. 1473).
NOTE: It must be capable of determination (since (DE LEON, supra at 720).
the law says “price certain”) (5 PARAS, supra at
324).

It must not be fictitious or nominal. Otherwise, there

is a possibility that the contract is one of
 LEASE V. SIMPLE LOAN LEASE COMMODATUM
SIMPLE LOAN
LEASE As to Contract
(MUTUUM)
Consensual Real
As to Transfer of Ownership
(DE LEON, supra at 721).
Lessor does not lose Ownership of the thing
ownership. transfers to the NOTE: Both consist in the transmission of the
borrower or debtor enjoyment or use of a thing to another (CIVIL CODE,
(CIVIL CODE, Art. Art. 1933).
1953).

As to Relationship Between the Parties

LEASE V. USUFRUCT
LEASE USUFRUCT
Lessor and lessee. Obligor or debtor and
oblige or creditor. As to Extent

As to Applicability of the Statute of Frauds Limited to the use Includes all possible
specified in the contract. uses and enjoyment of
If what is leased is real Not governed by the the thing (CIVIL
property for more than Statute of Frauds. CODE, Arts. 562, 564
one (1) year, the Statute and 566).
of Frauds must be
complied with (CIVIL As to Nature of Right
CODE, Art. 1403, 2 (e)).
A real right only by Always a real right
As to Object exception, when it (CIVIL CODE, Art.
involves land, and it is for 567, par. 3).
Covers real and Covers personal more than 1 year, or is
personal property. property only. registered.
As to Usury Law As to Creator of the Right
Not governed by the Governed by Usury Law The lessor may or may Can be created only
Usury Law. (CIVIL CODE, Arts. not be the owner, be the owner, or by
1175 and 1961). therefore he may or may duly authorized agent
(DE LEON, supra at 721-722). not be the creator of the acting in behalf of the
right. owner (CIVIL CODE,
Art. 563).
LEASE V. COMMODATUM
LEASE COMMODATUM As to Origin

As to Transfer of Ownership May be created only by May be created by

contract; and by way of law, by the will of
No transfer of No transfer of exception, by law (as in private persons
ownership. ownership. the case of implied new expressed in acts inter
lease; or when a builder vivos or in a last will
As to Cause has built in good faith a and testament, and by
building on the land of prescription (CIVIL
Onerous, although the Essentially gratuitous; if another, when the land is CODE, Art. 563).
rent may be there is a price or rent, considerably worth more
subsequently condoned the contract ceases to in value than the
or remitted. be commodatum. building).
As to Nature As to Cause
Personal in character. Owner or lessor is more The owner is more or
Not essentially personal
Thus, the death of or less active, and he less passive and he
in character. Hence, the
either the bailor or makes the lessee enjoy allows the
right may be transmitted
bailee ends the the thing – “hace gozar”. usufructuary to enjoy
to the heirs.
commodatum. the thing given in
 LEASE USUFRUCT LEASE DEPOSIT

usufruct – “dejagozar” at will (CIVIL CODE,

(CIVIL CODE, Art. Art. 1972).
62).

As to Repairs As to Consideration

The lessee generally has The usufructuary has Onerous. May be gratuitous
no duty to pay for repairs. the duty to make the (CIVIL CODE, Art.
ordinary repairs 1965).
(CIVIL CODE, Art.
592). As to Perfection of the Contract

As to Taxes Consensual. Real contract,

The lessee generally The usufructuary pays
pays no taxes. for the annual charges
and taxes on the fruits
(CIVIL CODE, Art.
596).
perfected only upon
delivery of the thing
(CIVIL CODE, Art.
1963).
(DE LEON, supra at 723).

As to Other Things
LEASE OF SERVICES V.
CONTRACT FOR A PIECE OF WORK
The lessee cannot A usufructuary may LEASE OF SERVICES CONTRACT FOR A
constitute a usufruct on lease the property (LOCATIO PIECE OF WORK
the property leased. itself to another (CIVIL OPERARUM) (LOCATIO OPERIS)
CODE, Art. 581).
(DE LEON, supra at 722-723). As to Object of Contract

The object of the The object of the

LEASE V. DEPOSIT contract is the labor or contract is the work
LEASE DEPOSIT service itself performed done (the result of the
by the lessor. labor) without
As to Nature considering the labor
that produced it (CIVIL
A real right only by Real right. CODE, Arts. 1689 and
exception, that is, when 1700).
it involves land, and it is
for more than one (1) As to Payment for Labor Performed
year or is registered.
The result is generally The result is generally
As to Object not important; hence the important; the price is
laborer is entitled to be not payable until the
Covers real and In extrajudicial deposit, paid even if there is work is completed and
personal property. only a movable thing destruction of the work said price cannot be
may be the object through fortuitous event lawfully demanded if
(CIVIL CODE, Art. or the result intended is the work is destroyed
1966). not attained. before it is finished and
accepted.
As to Purpose
As to Similarities
Enjoyment or use of the Safekeeping of the
thing leased. thing delivered (CIVIL 1. There is a price certain (compensation)
CODE, Art. 1962). 2. The relation of principal and agent does not
exist between the lessor and lessee.
As to When Demand for the Thing Can Be
Made x(5 PARAS, supra at 337-338).

Only upon expiration of Demand for return of

the contract. the thing can be made
 LEASE OF SERVICES V. AGENCY LEASE OF SERVICES AGENCY
LEASE OF SERVICES AGENCY
As to Liability as to Third Persons
As to Basis of Contract
Independent contractor GENERAL RULE:
It is based on It is based on personally liable for his Agent is not liable to
employment (the lessor representation – agent contracts with third third persons.
of services does not represents his principal persons. EXCEPTION: When
represent his employer and enters into juridical the agent expressly
nor does he execute acts. binds himself or
juridical acts). exceeds the limit of his
Agent enters into authority (CIVIL CODE,
Lessor does not enter juridical acts in behalf Art. 1897).
into juridical acts in of the principal (CIVIL
behalf of lessee. CODE, Art. 1868). As to Powers Possessed

As to Type of Contract Lessor is only limited to Agent exercises

Principal contract
ministerial duties. discretionary power
Preparatory contract; (CIVIL CODE, Arts.
the purpose is for the 1876, 1877, 1881,
agent to enter into 1882, 1884, 1887 and
other contracts which 1888).
he is authorized to (DE LEON, supra at 724-725).
enter.

As to Work to be Done LEASE OF CHATTELS

V. EMPLOYMENT
The lessor performs a The agent executes a
material act for the juridical act for and in LEASE OF CHATTELS EMPLOYMENT
benefit of his employer behalf of the principal
As to Relationship Between the Parties
without representation of (CIVIL CODE, Art.
the latter (CIVIL CODE, 1868). Lessor and lessee. Employer and
Art. 1644). employee (CIVIL
CODE, Arts. 1689 and
As to Consideration
1713).
Work or service must be Presumed to be for a
for a price or price or consideration
As to Control or Management Over the
consideration. (CIVIL CODE, Art.
Chattel
1875).
Lessor loses control or The employer retains
As to Extinguishment
management over the control or management
Will of both parties Will of one is sufficient chattel leased. over his chattel.
necessary. (CIVIL CODE, Arts.
1919 (1, 2), 1920 and
As to Control or Supervision Over the Lessee
1928).
or Employee
As to Persons Involved
Lessor has no control or The employer
Two persons – lessor Three persons – supervision over the exercises control and
and lessee. principal, agent, and lessee. supervision over the
third person. employee.

As to Risk of Loss Before Delivery

As to Payment or Compensation
Borne by the Borne by the principal
independent contractor since agent merely Lessee pays rent to the Employer pays wages
(CIVIL CODE, Arts. acts as representative. lessor for the enjoyment or salary for the
1717 and 1718). or use of the chattel. services of the
employee.
(DE LEON, supra at 724).
SERVICE AS DRIVER UNDER WHERE LEASE CONTRACT AMOUNTS
BOUNDARY SYSTEM TO VIRTUAL TRANSFER OF
Under the boundary system, the relation between OWNERSHIP
the driver and the jeepney owner is that of employer A contract whereby an alien is given not only a lease
and employee, not lessor and lessee (DE LEON, but also an option to buy a parcel of land by virtue of
supra at 733). which Filipino owner cannot sell or otherwise
dispose of her property for 50 years, circumvents the
LEASE OF THINGS constitutional ban against alien landholding
V. LEASE OF SERVICES (Philippine Banking Corp. v. Lui She, G.R. No. L-
17587, September 12, 1967).
LEASE OF THINGS LEASE OF SERVICES

As to Object of the Contract MAXIMUM PERIOD OF LEASE TO

ALIENS
Object is some work or Under P.D. No. 471, the maximum period is 25
Object of contract is a
service. years, renewable for another 25 years upon mutual
thing.
agreement of both lessor and lessee. R.A. No. 7652
(Investors’ Lease Act), regulates the long-term lease
As to Obligation of the Lessor of private lands by foreign investors.
Lessor has to perform
Lessor has to deliver PROPER AUTHORITY REQUIRED IF
some work or service.
the thing leased.
LEASED TO BE RECORDED IN
REGISTRY OF PROPERTY (CIVIL CODE,
As to Remedy in Case of Breach Art. 1647)
In case of breach, there In case of breach, no If a lease is to be recorded, the following persons
can be an action for action for specific must have proper authority (special power of
specific performance. performance. attorney to constitute the lease):
1. The husband with respect to the paraphernal
(DE LEON, supra at 724). real estate of the wife, unless the administration
of such properties has been transferred to the
PERSONS DISQUALIFIED TO BE husband done in a public instrument duly
LESSEES recorded (FAMILY CODE, Art. 110). Conjugal
property cannot be leased without the joint
The persons disqualified to buy referred to in
consent of the spouses;
Articles 1490 and 1491, are also disqualified to
2. The father or guardian with respect to the
become lessees of the things mentioned therein
property of the minor or the ward (CIVIL CODE,
(CIVIL CODE, Art. 1646).
Art. 1647); and
3. The manager (administrator) with respect to the
The prohibition is adopted in Article 1946 because of
property under his administration (CIVIL CODE,
the similarity between the contract of lease and that
Art. 1647).
of sale (DE LEON, supra at 736).
NOTE: Article 1647 does not specify the term of the
(Please refer to the discussions on Articles 1490 and
lease. Every lease of real estate may be recorded,
1491 in page 541). and if recorded, creates a real right binding upon the
parties (CIVIL CODE, Art. 1648).
LEASE OF REAL PROPERTY TO ALIENS
GENERAL RULE: Foreigners are prohibited by the REASON: The registration of the lease is an act of
Constitution ownership or strict dominion; hence, a special power
of attorney is necessary (DE LEON, supra at 739).
EXCEPTION: In cases of hereditary successions, to
acquire lands in the Philippines (CONST., Art. XII, THE MANAGER’S SPECIAL POWER OF
Secs. 2 and 7).
ATTORNEY IS REQUIRED FOR
Nevertheless, they can lease real or immovable VALIDITY
property in the Philippines (Investors Lease Act, R.A. The requirement under Article 1878 (8) is imposed
7652, Sec. 4). whether or not the lease will be recorded. In the
absence of a special power, a lease for more than
one (1) year executed by persons mentioned in
Article 1647 is valid only for one (1) year but void as
to the excess (DE LEON, supra at 739).
NOTE: The word manager in the law is a broad term
and may be:
1. The administrator of conjugal property (Chua v.
CA, G.R. No. L-60015, December 19, 1984);
2. Administrator of co-ownership (Melencio v. Dy
Tiao Lay, G.R. No. L-32047, November 1,
1930);
3. Administrator of state patrimonial property
(Tipton v. Andueza, G. R. No. 2070, January 2,
1906).
RECORDING OF THE LEASE OF REAL
PROPERTY
Its purpose is to notify strangers to the transaction
(CIVIL CODE, Art. 1648). It is intended to protect the
lessee, who cannot be ousted by the buyer if the
lease is recorded (Report of the Civil Code
Commission, p. 142).
However, if the purchaser has actual knowledge of
the existence of the lease, which knowledge is
equivalent to registration, he is bound by the lease
(Lao v. Lao, G.R. No. 149599, May 16, 2005).
LEASE AS PERSONAL OR REAL RIGHT
GENERAL RULE: Lease is only a personal right
(DE LEON, supra at 703).
EXCEPTIONS: Lease partakes of the nature of real
right if:
1. Lease of real property is more than one (1) year,
and to be enforceable, it must be in writing; or
2. Lease of real property is registered regardless of
duration with Registry of Property (CIVIL CODE,
Art. 1648).
NOTE: Lease of personal property cannot be
registered. To be binding against third persons, the
parties must execute a public instrument (DE LEON,
supra at 740-741).
EFFECT OF ACTUAL NOTICE OF
UNREGISTERED LEASE BY THE
PURCHASER
Where a purchaser of a land at the time of the
purchase has full knowledge that the land has been
leased to a third person, he is bound to respect said
lease, although it is not entered upon the certificate
of sale (Lao v. Lao, G.R. No. 149599, May 16, 2005).
ASSIGNMENT OF LEASE BY LESSEE
GENERAL RULE: A lessee cannot assign the lease
without consent of lessor (CIVIL CODE, Art. 1649).
REASON: In the case of cession or assignment of
lease rights on real property, there is a novation by
the substitution of the person of one of the parties —
the lessee. The personality of the lessee, who
dissociates from the lease, disappears; only two
persons remain in the juridical relation — the lessor
and the assignee who is converted into the new
lessee (Inocencio v. De San Jose, G.R. No. 201787,
September 25, 2013).
The objective of the prohibition is to protect the
lessor or owner of the leased property (Dakudao v.
Consolacion, G.R. No. L-54753, June 24, 1983).
EXCEPTION: If there is stipulation to the contrary
(CIVIL CODE, Art. 1649).
An assignment exists when the lessee made an
absolute transfer of his leasehold rights in a contract,
and he has disassociated himself from the original
contract of lease. Consequently, the juridical relation
is only between the lessor and the assignee
(Manlapat v. Salazar, G.R. No. L-8221, January 31,
1956).
SUBLEASE
It is a separate and distinct contract of lease wherein
the original lessee becomes a sublessor to a
sublessee of the thing, in whole or in part, without
prejudice to his responsibility for the performance of
the contract toward the lessor (CIVIL CODE, Art.
1650).
As the existence of the sublease depends upon the
lease, the sublease is terminated upon the
rescission of the lease contract (Go King v.
Geronimo, G.R. No. L-2126, August 27, 1948).
A sublease cannot have a term longer than that of
the lease on which it is dependent. It terminates
upon the termination of the lease, unless the lease
is for a shorter term (Blas v. CA, G.R. No. 82813,
December 14, 1989).
RIGHTS OF THE LESSEE TO SUBLEASE
Unlike in assignment, a lessee may generally
sublease the property in the absence of express
prohibition (CIVIL CODE, Art. 1650).
REASON: The lessee remains a party (bound by the
terms and conditions of the contract) to the lease
even if he has already created a sublease thereon
(DE LEON, supra at 744).
NOTE: Under Section 9 (a) of R.A. 9653 (Rent
Control Act of 2009), assignment of lease or
subleasing of residential in whole or in part, including
the acceptance of boarders or bed spacers, without
the written consent of the owner/lessor is a ground
for judicial ejectment.
Accepting boarders is not equivalent to subleasing
since the lessee does not relinquish or surrender his
lease to them. He did not cease to become the
actual occupant and possessor of the demised
premises (Malasarte v. CA, G.R. No. 178 SCRA 310,
1989).
RIGHTS OF THE LESSOR IF SUBLEASE
IS PROHIBITED BUT SUBSEQUENTLY
ENTERED INTO BY THE LESSEE:
1. Rescission and damages; or
2. Damages only (Contract will be allowed to
remain in force).
As the existence of the sublease depends upon the
lease, the sublease is terminated upon the
rescission of the lease contract (Go King v.
Geronimo, G.R. No. L-2126, August 27, 1948).
SUBLEASE V. ASSIGNMENT OF LEASE
ASSIGNMENT OF
SUBLEASE
LEASE
As to Number of Juridical Relations Created
There are two leases There is only one
and two distinct juridical juridical relationship,
relationships although that of the lessor and
immediately connected the assignee, who is
and related to each converted into
other. lessee.
As to Personality of Lessee
The personality of the The personality of the
lessee does not lessee disappears.
disappear.
As to Transfer of Rights and Obligations
The lessee does not The lessee transmits
transmit absolutely his absolutely his rights to
rights and obligations to the assignee.
the sublessee.
As to Right of Action Against Lessor
The sublessee, The assignee has a
generally, does not have direct action against
any direct action against the lessor.
the lessor.
(DE LEON, supra at 744-745).
RESPONSIBILITY OF A SUBLESSEE TO
THE LESSOR
GENERAL RULE: The sublessee is directly liable to
the sublessor and not the lessor (Manlapat v.
Salazar, G.R. No. L-8221, January 31, 1956).
REASON: There is no juridical relationship between
the lessor and the sublessee (CIVIL CODE Art.
1311).
EXCEPTIONS:
The sublessee is responsible to the lessor for:
1. All acts which refer to the use and preservation
of the thing leased in the manner stipulated
between the lessor and the lessee (CIVIL
CODE, Art. 1651); and
2. Rent due to the lessor from the lessee which the
latter failed to pay (CIVIL CODE, Art. 1652).
Amount recoverable: Since the liability of the
sublessee is subsidiary, the sublessee shall not be
responsible beyond the amount of rent due from him,
in accordance with the terms of the sublease, at the
time of the extrajudicial demand by the lessor (CIVIL
CODE, Art. 1652).
PURPOSE: To prevent situation where the lessee
collects rents from the sublessee but does not pay
his rents to the lessor (DE LEON, supra at 744-745).
ACCION DIRECTA
It is a direct action which the lessor may bring
against a sublessee who misuses the subleased
property (5 PARAS, supra at 354).
a
NOTE: If the lessor was compelled to file a
complaint, which is equivalent to a judicial demand,
the lessor can claim other forms of damages from
the sublessee like attorney’s fees, costs, etc.
(PINEDA, Sales, supra at 485).
NECESSITY OF JUDGMENT AGAINST
THE LESSEE
There must be a judgment against the lessee
evicting the latter from the premises, or cancelling
the lessee’s lease contract, when he cannot pay the
rentals and the sublessee is in possession. The
mere failure of the lessee to pay the rentals does not
make the sublessee subsidiarily liable (Wheelers
Club Int’l v. Bonifacio Jr., G.R. No. 139540, June 29,
2005).
LIABILITY FOR RENTS PAID IN
ADVANCE
Payments of rents in advance by the sublessee shall
be deemed not have been made, so far as the
lessor’s claim is concerned, unless said payments
were effected in virtue of the customs of the place
(CIVIL CODE, Art. 1652, par. 2).
REASON: To avoid collusion between the lessee
and sublessee (DE LEON, supra at 749).
WARRANTY OF THE LESSOR
The provisions governing warranty, contained in the
Title on Sales, shall be applicable to the contract of
lease. (CIVIL CODE, Art. 1653).
In cases where the return of the price is required,
reduction shall be made in proportion to the time
during which the lessee enjoyed the thing (Id.).
OBLIGATIONS
OF LESSOR
OBLIGATIONS OF THE LESSOR:
(CT-DAN)
1. Cannot alter the form of the thing leased (CIVIL
CODE, Art. 1661);
Alteration – to constitute alteration, the
modification must be in such manner that it
would destroy the substance of the thing leased
unserviceable for the use intended (DE LEON,
supra at 767).
2. The obligation to protect the lessee covers acts
of Third persons and of the lessor (Bercero v.
Capitol Development Corp., G.R. No. 154765,
March 29, 2007);
3. Delivery of the object (actual or constructive;
cannot be waived) (CIVIL CODE, Art. 1654, par.
1);
NOTE: At the time of the delivery, the thing must
be in a condition fit for the use intended;
otherwise, lessee’s cause of action is against
the lessor for breach of contract. The lessee has
no cause of action against the possessor
because he has no relation (Republic v. De Los
Angeles, G.R. No. L- 26112, October 4, 1971).
4. Maintenance in peaceful and Adequate
enjoyment of the lease for the entire duration of
the contract (CIVIL CODE, Art. 1654, (3)).
The obligation arises only when legal trespass
disturbs the lessee’s peaceful enjoyment thereof
(Bercero v. Capitol Development Corp., G.R.
No. 154765, March 29, 2007);
5. Making of Necessary repairs, unless there is a
stipulation to the contrary (CIVIL CODE, Art.
1654, par. 2).
NOTE: In default of a special stipulation, the
custom of the place shall be observed as to the
kind of repairs (CIVIL CODE, Art. 1686).
WHERE LEASE CONTRACT CONTAINS
RIGHT OF FIRST REFUSAL
The lessor is under a legal duty to the lessee not to
sell to anybody at any price until after he has made
an offer to sell to the latter at a certain price and the
lessee has failed to accept it (PUP v. CA, G.R. No.
143513, November 14, 2001).
The sale in violation of such right is valid. It may be
rescinded or may be the subject of an action for
specific performance (PUP v. Golden Horizon Realty
Corp., G.R. No. 183612, March 15, 2010).
RIGHT OF LESSOR TO CONTINUE
SAME BUSINESS OR INDUSTRY
ENGAGED IN BY LESSEE
GENERAL RULE: The lessor of a business or
industrial establishment may continue engaging in
the same business or industry to which the lessee
devotes the thing leased (CIVIL CODE, 1656).
EXCEPTION: There is a stipulation to the contrary.
REASON: A lease is no warranty by the lessor to the
lessee that the latter’s business would be
successful. Even if the lessee should suffer losses,
he would still be bound to fulfill the terms of the lease
(City of Naga v. CA, G.R. No. L-5944, November 26,
1954).
RULES ON ALTERATION OF THE FORM
OF THE LEASE
The lessor cannot alter the form of the thing leased
in such a way as to impair the use to which the thing
is devoted under the terms of the lease (CIVIL
CODE, Art. 1661).
REASON: Right of the lessee to be maintained in
peaceful enjoyment for the entire duration of the
contract (CIVIL CODE, Art. 1654, par. 3).
NOTE: To constitute alteration, the modification
must be in such manner that it would destroy the
substance of thing leased unserviceable for the use
intended (Id.).
RULES IN CASE OF USEFUL
IMPROVEMENTS AND ORNAMENTAL
EXPENSES
1. Rights of Lessee in case of Useful
Improvement
a. To remove the improvements should the
lessor refuse to reimburse although the
principal may suffer damage; or
b. To be reimbursed by one-half (1/2) of the
value of said improvements at the time of
termination of the lease should the lessor
choose to appropriate it (CIVIL CODE, Art.
1678, par. 1).
PURPOSE: To prevent unjust enrichment of the
lessor. The lessee is not a possessor in good
faith in the sense he believes himself to be the
owner, but neither is he a possessor in bad faith.
He is in possession by virtue of a contract, so his
possession is lawful.
The lessor is to pay only one-half (1/2) of the
value of the improvements at the time the lease
terminates because the lessee has enjoyed the
same. On the other hand, the lessor will enjoy
them indefinitely thereafter (Report of the Civil
Code Commission, pp. 144-145).
Parties may stipulate that the lessor may
appropriate them without reimbursing the lessee
should the latter fail to comply with the terms of
the lease contract. Courts may equitably reduce
a stipulated penalty in the contracts (1) if the
principal obligation has been partly or irregularly
complied with; and (2) even if there has been no
compliance if the penalty is iniquitous or
unconscionable in accordance with Article 1229
of the Civil Code (Florentino v. Supervalue, Inc.,
G.R. No. 172384, September 12, 2007).
To be entitled to either two remedies, the
following must concur:
a. Lessee must be a considered a builder in
good faith (Florentino v. Supervalue, Inc.,
G.R. No. 172384, September 12, 2007);
NOTE: The improvements can be
considered made in good faith if they are not
in violation of the lease contract (DE LEON,
supra at 808).
b. Improvements must be suitable to the use
for which the lease is intended; and
c. The form and substance of the property
leased should not be altered (Inocencio v.
Hospicio de San Jose, G.R. No. 201787,
September 25, 2013).
2. Rights of Lessee in case of Ornamental
Expenses
The lessee has no right of reimbursement, but
he may remove them, provided:
a. No damage is caused to the principal thing;
and
b. Lessor does not choose to retain them by
paying their value at the time of the lease
(CIVIL CODE, Art. 1678, par. 2).
Rules in Case of Urgent Repairs
The lessor has the obligation to make necessary
repairs (CIVIL CODE, Art. 1654, par. 2); and the
lessee is obliged, within the shortest possible
time, to advise of the need of such repair (CIVIL
CODE, Art. 1663, par.2).
The lessee is obliged to tolerate the work
although it may be very annoying to him and
although during the same time he may be
deprived of a part of the premises, if repairs last
for less than forty (40) days (CIVIL CODE, Art.
1662, par. 1).
The burden is on the lessor to prove the urgency
of the repair (DE LEON, supra at 769).
If the repairs are not urgent, the lessor is liable
for damages suffered by the lessee (PINEDA,
Sales, supra at 485).
NOTE: Article 1642 speaks of repairs.
Modifications or improvements which the lessor
may want to make on the property during the
period of the lease cannot be done against the
objection of the lessee (Id. at 769).
Rights of Lessee in Case of Urgent Repairs
If forty (40) days or more - the lessee can ask
for reduction of the rent in proportion to the time
– including the first forty (40) days – and the part
of the property of which he is deprived (Id.).
If less than forty (40) days - the lessee cannot
ask for reduction of the price in the absence of a
provision in the contract giving him such right or
for rescission (Id.).
When Rescission may be availed of
In either case, rescission may be availed of if the
main purpose of the lease is to provide a
dwelling place for the lessee and the property
becomes uninhabitable (CIVIL CODE, Art.
1662).
Remedies if the Lessor Fails to Make Urgent
Repairs
The lessee may: (RISA)
a. Order Repairs at the lessor’s cost, to avoid
imminent danger;
 b. Indemnification for damages;
c. Suspend the payment of the rent; or
d. Ask for rescission, in case of substantial
damage to him (CIVIL CODE, Art. 1663).
If the lessor refuses to make urgent repairs
despite notice, the remedy of the lessee is to
make urgent repairs themselves and to charge
the cost to the lessor and not to suspend
payment of rentals (Banzon v. Ubay, G.R. No. L-
46464, November 21, 1979).
TWO KINDS OF TRESPASS IN LEASE
1. Trespass in Fact (perturbacion de mero
hecho)
A physical disturbance on the property leased
such as an intrusion without any legal claim to
justify entry into the property (CIVIL CODE, Art.
1664).
Illustration: Forcible entry
Liability of lessor: Lessor will not be held liable.
REASON: The duty to maintain the lessee in the
peaceful enjoyment of the lease is a warranty
that the lessee shall not be disturbed in his legal,
and not physical, possession (Bercero v. Capitol
Development Corp., G.R. No. 154765, March
29, 2007).
The lessee is authorized by law to pursue a
direct action against the usurper or intruder
(CIVIL CODE, Art. 1664).
2. Trespass in Law (perturbacion de
derecho)
A third person claims legal right to enjoy the
premises.
Liability of lessor: The lessor will be held liable
to the lessee. The lessor may maintain an action
to recover title (accion reinvindicatoria), or to
establish his better right of possession (accion
publiciana) (DE LEON, supra at 773).
NOTE: In the Goldstein case, trespass in fact is
distinguished from legal transfer. If the trespass
is not accompanied or preceded by anything
which reveals a juridical intention on the part of
the trespasser, in such wise that the lessee can
only distinguish the material fact, stripped of all
legal forms or reasons, it is only trespass in fact
(de mero hecho) (Nakpil v. Manila Towers
Development Corp., G.R. No. 160867,
September 26, 2006).
The act of the Japanese armed forces in evicting
the lessee from the leased premises and
occupying the same was a trespass in law under
the rules of “belligerent occupation” (Villaruel v.
Manila Motor Co., G.R. No. 10394, December
13, 1958).
A lessor is not responsible for the lessee’s
eviction through condemnation proceedings and
cannot be held liable for damages therefor. The
lessee must look to the expropriating plaintiff for
his compensation (Sayo v. Manila Railroad Co.,
G.R. No. L-17357, June 21, 1922).
The obligation to maintain the lessee in the
peaceful and adequate enjoyment of the leased
property seeks to protect the lessee not only
from the acts of third persons but also from the
acts of the lessor (Bercero v. Capitol
Development Corp., G.R. No. 154765, March
29, 2007).
PRESUMPTION OF RECEIPT OF THING
LEASED IN GOOD CONDITION (CIVIL
CODE, Art. 1666)
In the absence of a statement (or representation),
written or oral concerning the condition of the thing
at the time the lease was constituted, the law
presumes that the lessee received it in good
condition, unless there is a proof to the contrary.
OBLIGATIONS OF
LESSEE
OBLIGATIONS OF THE LESSEE:
(PUT-EN2R)
1. To Pay the price of the lease according to the
terms stipulated (CIVIL CODE, Art. 1657 par. 1).
The lessee is obliged to pay rentals during the
pendency of the action for rescission of the lease
(M & M Management Aids, Inc. v. CA, G.R. No.
L-53924, June 29, 1984).
Proper rate for back rentals is 6% (BSP Cir. No.
799, S. 2013) per annum computed from the
time of demand. Back rentals are equivalent to
a loan or forbearance of money (Castro v.
Palenzuela, G.R. No. 184698, January 21,
2013).
The lessor has not only the right to terminate the
lease upon the expiration of the term but also to
increase the rent in case of renewal. The lessee
has an option to accept the new rate or vacate
the premises; otherwise, he will be considered a
possessor in bad faith of the property (De Leon
 Vda. de Roxas v. CA, G.R. No. L-39146, March
25, 1975).
2. To Use the thing leased as a diligent father of a
family would, devoting it to the use stipulated;
and in the absence thereof, to that inferred from
the nature of the thing leased according to the
custom of the place (CIVIL CODE, Art. 1657,
(2)).
The lessee is liable for any deterioration caused
by members of his household, guests and
visitors (CIVIL CODE, Art. 1668).
Basis: He is made legally responsible for their
acts as in quasi-delicts (CIVIL CODE, Arts. 2176
and 2180) under the principle of command
responsibility. The law makes no distinction
between intentional or negligent acts of third
persons. The lessee may recover from the third
persons what he has paid in satisfaction of the
claim of the lessor (DE LEON, supra at 777).
3. To Tolerate urgent repairs even if annoying to
him and although during the same, he may be
deprived of part of the premises (CIVIL CODE,
Art. 1662, par. 1) unless the dwelling becomes
uninhabitable (CIVIL CODE, Art. 1662, par. 3).
4. To pay Expenses for the deed of lease (CIVIL
CODE, Art. 1657, par. 2).
NOTE: By agreement, the obligation may be
assumed by the lessor (DE LEON, supra at
760).
5. To Notify the lessor of usurpation or untoward
acts which any third person may have
committed or may be openly preparing to carry
out upon the leased thing (CIVIL CODE, Art.
1663).
REASONS:
a. So that the lessor may bring proper action
against the usurper (Simpao v. Dizon, G.R.
No. 452, April 30, 1902).
b. It is unjust to compel the lessor to stand idly
and trust the defense of his property to a
mere lessee (Roxas v. Mijares, G.R. No.
3823, November 23, 1907).
6. To Notify the lessor of need for repairs (CIVIL
CODE, Art. 1663, par. 2).
REASON: Because the lessee is in possession
and the lessor has no duty to make constant
inspection (Gregorio Araneta Inc. v. Lyric Film
Exchange Inc., G.R. 37730, November 14,
1933).
Notification is not essential if the lessor actually
knows the need for the repairs (Johnson Picket
Rope Co. v. Grey, CA, 40 O.G. (Supp. 11) 239).
7. To Return the property leased upon termination
of the lease in the same condition as he received
it save what has been lost or impaired by:
a. Lapse of time;
b. Ordinary wear and tear; or
c. Inevitable cause/fortuitous event (CIVIL
CODE, Art. 1665).
NOTE: If the lessee fails to comply with (5) and (6),
he would be liable for damages which the lessor
would suffer and which could have been avoided by
the lessee's diligence (CIVIL CODE, Art. 1663, par.
3).
RESPONSIBILITY OF THE LESSEE FOR
DETERIORATION OR LOSS OF THING
LEASED (CIVIL CODE, 1667)
The lessee is responsible for the deterioration or loss
of the thing leased, unless he proves that it took
place without his fault. This burden of proof on the
lessee does not apply when the destruction is due to
earthquake, flood, storm, or other natural calamity.
REMEDIES
ALTERNATIVE REMEDIES OF
AGGRIEVED PARTY
If the lessor or the lessee should not comply with the
obligations set forth in Article 1654 and 1657, the
aggrieved party ask for:
1. Rescission and damages (CIVIL CODE, Art.
1659);
NOTE: The lessor may directly file an action for
ejectment against the lessee instead of
rescinding the contract (Pamintuan v. Tiglao,
G.R. No. L-29292, March 13, 1929).
The court cannot apply Article 1191 par. 3 to
grant additional time for the performance of the
obligation if the aggrieved party avails the option
of rescission in Article 1659 (DE LEON, supra at
762).
A lessee cannot take advantage of his own
wrongdoing to rescind the lease. He cannot
refuse to pay the rent and then declare the lease
rescinded. Rescission is a remedy granted only
to the injured part and cannot be availed of by
 the wrongdoer (Fernandez Hermanos v. Pitt,
G.R. No. L-11068, March 29, 1916).
2. Damages only, allowing the contract to remain
in force – Specific Performance (CIVIL CODE,
Art. 1659);
NOTE: Damages recoverable in ejectment
cases are the rents or the fair rental value of the
premises and liquidated damages if agreed
upon by the parties (DE LEON, supra at 762).
The following cannot be successfully
claimed:
a. Profits plaintiff could have earned were it not
for the forcible entry or unlawful detainer;
b. Material injury to the premises; and
c. Actual, moral, or exemplary damages
(Baens v. CA, G.R. No. L-57091, November
23, 1983).
d. Future rents where the termination of the
lease abrogated liability for future rents
(Rios v. Jacinto, Palma y Hermanos, G.R.
No. L-23893, March 23, 1926).
OTHER REMEDIES OF THE LESSOR
1. May hold the sublessee bound for all acts which
refer to the use and preservation of the things
leased (CIVIL CODE, Art. 1651);
2. May hold the sublessee subsidiarily liable for
any rent due from the lessee (CIVIL CODE, Art.
1652); or
3. Ejectment (CIVIL CODE, Art. 1673 (1), (2), (3)
& (4)).
REMEDIES OF THE LESSEE:
1. Extinguishment of the lease in case of total
destruction of the thing leased caused by
fortuitous event (CIVIL CODE, Art. 1655);
Where the buildings and the land, which formed
part of the consideration of the lease contract,
constituted an indivisible unit, the destruction of
the building extinguished the obligation or
terminated the lease contract (Rohde Shotwell
v. Manila Motors Co., Inc., G.R. No. L-7637,
December 29, 1956).
2. Proportional reduction of the rent or rescission in
case of partial destruction of the thing leased
caused by fortuitous event (CIVIL CODE, Art.
1655);
Once the choice of the lessee has been
communicated to the lessor, the former cannot
change it (CIVIL CODE, Art. 1201).
NOTE: Art. 1655 of the Civil Code provides for
an instance where the lessee may rescind the
contract of lease as a matter of right
notwithstanding the fact that lessor is not guilty
of breach or negligence.
3. Terminate the lease in case a dwelling place or
any other building intended for human habitation
that its use brings imminent and serious danger
to life and health (CIVIL CODE, Art. 1660); or
Immediate Termination of Lease with Notice
under Art. 1660 of the Civil Code Applies:
a. Only to dwelling place or any other building
intended for human habitation; and
b. Even if at the time the contract was
perfected, the lessee knew of the dangerous
condition or waived the right to rescind on
account of such condition.
The rule can apply to commercial buildings
where workers perform their jobs (PINEDA,
Sales, supra at 483).
REASON: The right of the lessee is a precaution
for public safety which is above any stipulation.
(Report of the Code Commission, p. 142). It
cannot be waived (CIVIL CODE, Art. 6).
4. Suspension of the payment of rent (CIVIL
CODE, Art. 1658).
NOTE: However, in the Banzon case, the SC
ruled that the remedy is not to suspend payment
but to make the urgent repair and charge cost
thereof against the lessor (G.R. No. L-46464,
November 21, 1979).
INSTANCES WHEN THE LESSEE MAY
SUSPEND THE PAYMENT OF RENT:
1. Lessor fails to make the necessary repairs; or
In case the lessee makes the repairs, he cannot
suspend the payment of rent as a matter of right.
The remedy is legal compensation. He still
needs to pay the rent but it will be compensated
by the amount he spent for the repairs.
2. Lessor fails to maintain the lessee in peaceful
and adequate enjoyment of the property leased
(CIVIL CODE, Art. 1658).
NOTE: “Suspend”– for the intervening period,
the lessee does not have to pay the rent unless
the lessor can prove that the suspension was not
legally justifiable (DE LEON, supra at 761).
Article 1658 of the Civil Code allows a lessee to
postpone the payment of rent if the lessor fails
to either (1) "make the necessary repairs" on the
property or (2) "maintain the lessee in peaceful
and adequate enjoyment of the property
 leased." This provision implements the
obligation imposed on lessors under Article
1654 (3) of the Civil Code. The failure to
maintain the lessee in the peaceful and
adequate enjoyment of the property leased does
not contemplate all acts of disturbance. Lessees
may suspend the payment of rent under Article
1658 of the Civil Code only if their legal
possession is disrupted. The duty 'to maintain
the lessee in the peaceful and adequate
enjoyment of the lease for the duration of the
contract' mentioned in [N]o. 3 of [Article 1654] is
merely a warranty that the lessee shall not be
disturbed in his legal, and not physical,
possession." (Racelis v. Spouses Javier, G.R.
No. 189609, January 29, 2018).
EFFECTIVITY OF THE SUSPENSION
The right begins:
1. In the case of repairs, from the time demand is
made upon the lessor and the latter fails to
perform his obligation;
2. In the case of eviction, from the time he is
unlawfully dispossessed (DE LEON, supra at
761).
DURATION OF THE LEASE
The period may be definite or indefinite but, in any
case, the period is only temporary, not perpetual. If
there is a determinate time or period fixed (definite),
the lease will be for the said period and ends on the
day fixed without the need of demand (CIVIL CODE,
Art. 1669).
Ninety-nine (99) year Limitation
The longest period that can be stipulated is only
ninety-nine (99) years.
If period is more than ninety-nine (99) years, the
lease is considered as having expired at the end of
99 years. The excess is considered to be an
indefinite period should an implied new lease arise.
PURELY POTESTATIVE CONDITION
As a rule, a lease contract providing that the lessee
can stay in the premises for as long as he wants and
for as long as he can pay the rentals and its
increases are not permissible as it is a purely
potestative condition, leaving the effectivity and
enjoyment of leasehold rights to the sole and
exclusive will of the lessee. However, the SC upheld
that a lease contract, which provides that “the lease
contract shall continue for an indefinite period
provided that the lessee is up-to-date in the payment
of his monthly rentals” for the contract is one with a
period subject to a resolutory condition (Jespajo
Realty v. CA, G.R. No. 113626, September 27,
2002).
If from the circumstances it can be inferred that a
period was intended, the court may fix the duration
thereof under Article 1197 of the Civil Code.
A lease of things during the lifetime of one of the
parties, as the lessor or lessee may please, is one
for life, ending upon the death of either party
(Eleizegui v. The Manila Lawn Tennis Club, G.R. No.
967, May 19, 1903).
A month-to-month lease is for a definite period.
Where the parties agreed that upon the thirty (30)
day notice, either party may terminate the
agreement, the lease is for a definite period (Rantael
v. CA, G.R. No. L-47519, April 30, 1980).
When the action is to terminate the lease, notice or
demand to vacate is not necessary. Demand is only
a prerequisite to an action for unlawful detainer when
the action is for failure to pay rent due, or to comply
with the conditions of the lease (Co Tiamco v. Diaz,
G.R. No. L-7, January 22, 1946). Thus, the absence
of demand does not change the fact that the lease
contract has ended upon the termination of the
period fixed for its existence.
IF THERE IS NO FIXED PERIOD
(INDEFINITE):
1. For rural lands
a. It shall be for all the time necessary for the
gathering of fruits which the whole estate
may yield in one (1) year; or
b. Which it may yield once although two or
more years have elapsed (CIVIL CODE, Art.
1682).
2. For urban lands
a. If rent is paid daily, lease is from day to day;
b. If rent is paid weekly, lease is from week to
week;
c. If rent is paid monthly, lease is from month
to month; or
d. If rent is paid yearly, lease is from year to
year (CIVIL CODE, Art. 1687).
NOTE: Article 1687 does not apply where there
is a fixed period, whether such period is definite
or indefinite (DE LEON, supra at 820).
a. A lease contract on a month-to-month basis
(Junson v. Martinez, G.R. No.141324, July
8, 2003);
b. A lease stipulating that the lessee will vacate
as soon as the lessor needed the premises
(Lim v. Legarda Vda. de Prieto, G.R. No.
9189, March 30, 1957);
c. A lease contract with a period subject to a
resolutory condition (Jespajo Realty v. CA,
G.R. No. 113626, September 27, 2002).
NOTE: In all cases, whether for definite or indefinite
period (except for the last paragraph mentioned in
number 1 above), the lease is not terminated by
reason of the death of either the lessor or lessee
(Inocencion v. Hospicio de San Jose, G.R. No.
201787, September 25, 2013).
BASIS: Relativity of contracts
RULES ON EXTENSION OF THE LEASE
PERIOD:
1. If a lease contract for a definite term allows
lessee to extend the term, there is no necessity
for lessee to notify lessor of his desire to extend
the term, unless the contrary is stipulated
(Cosmopolitan Ballet and Dance School, et. al.
v. Teodoro, G.R. Nos. L-7838, November 10,
1942).
2. “May be extended” as stipulation
– Lessee can extend without lessor’s consent
but lessee must notify lessor (Koh v. Ongsiako,
G.R. No. 11106, January 27, 1917).
3. “May be extended for six (6) years agreed upon
by both parties” as stipulation
– This must be interpreted in favor of the lessee.
Hence, ordinarily the lessee at the end of the
original period may either:
a. Leave the premises; or
b. Remain in possession (Cruz v. Alberto, G.R.
No. 13791, August 7, 1919).
4. In co-ownership, assent of all is needed,
otherwise it is void or ineffective against non-
consenting owners (Leonzon v. Limlingan, et al,
G.R. No. L-9552, September 30, 1957).
5. Where according to the terms of the contract, the
lease can be extended only by the written
consent of the parties, no right of extension can
arise without such written consent (Teodoro v.
Mirasol, G.R. No. L-8934, May 18, 1956).
6. If the option is given to the lessor, the lessee
cannot renew the lease against the former's
refusal. The lease is deemed terminated (DE
LEON, supra at 661).
7. Where a lessee is given the option to continue
or renew the contract of lease and is silent upon
the rentals, the old terms are to be followed in
the renewed lease (Gustilo v. CA, G.R. No. L-
61083, February 28, 1983).
8. The lessor may impose additional conditions
after the expiration of the original period.
9. Article 1687 par. 2 of the Civil Code provides
that in the event that the lessee has occupied
the leased premises for over a year, courts may
fix a longer term of lease. The power of the
courts to establish a grace period is potestative
or discretionary, depending on the particular
circumstances of the case (Malayan Realty, Inc.
v. Uy Han Yong, G.R. No. 163763, November
10, 2006).
10. A verbal agreement to extend the lease is
admissible to qualify the terms of a written
contract (Florentino v. Supervalue Inc., G.R. No.
172384, September 12, 2007).
11. The extension granted shall be commensurate
with the period of occupation (Araneta v. De
Mesa, G.R. No. L-21972, September 30, 1970).
NOTE: The lessor has the right to increase rent for
each period subject to existing laws in the same way
that the lessee has all the right to refuse to
acquiesce. Upon such refusal, the contract of lease
between the parties is deemed terminated (Chua v.
Victorino, G.R. No. 155768, May 18, 2004).
RULE IF THE LESSOR OBJECTS TO THE
LESSEE’S CONTINUED POSSESSION
Requisites:
1. Contract has expired;
2. Lessee continues enjoying the thing; and
3. Lessor objected to this enjoyment (CIVIL CODE,
Art. 1671).
NOTE: If the three requisites are present, the lessee
shall be considered a possessor in bad faith (CIVIL
CODE, Art. 1671).
REMEDY OF THE LESSOR
Bring an action of unlawful detainer to recover
possession of the premises and the rents or fair
rental value of the property (DE LEON, supra at
670).
NOTE: Profits, which the plaintiff might have
received were it not for the forcible entry or unlawful
detainer, are not covered for it does not represent
“fair value” (DE LEON, supra at 789).
IMPLIED NEW LEASE (TACITA
RECONDUCCION)
Arises if at the end of the contract, the lessee should
continue enjoying the thing leased for at least fifteen
(15) days with the acquiescence of the lessor, unless
a notice to the contrary had previously been given by
either party (5 PARAS, supra at 393).
Requisites:
1. The term of the original contract has expired;
2. The lessor or lessee has not previously given a
notice to vacate; and
3. The lessee continued enjoying the thing leased
for at least fifteen (15) days at the end of the
 contract with the acquiescence of the lessor
(CIVIL CODE, Art. 1670).
NOTE: The notice required is the one given after the
expiration of the lease period for the purpose of
aborting an implied renewal of lease (Tagbilaran
Integrated Settlers Assoc v. CA, G.R. No. 148562,
November 25, 2004).
A lessor who gives notice after the 15-day period has
no cause of action for unlawful detainer as there is
already an implied new lease (DE LEON, supra at
787).
Instances when there is NO Implied New Lease:
1. When before or after the expiration of the term,
there is a notice to vacate given by either party
(CIVIL CODE, Art. 1670);
2. When there is no definite or fixed period in the
original lease contract as in the case of
successive renewals of the lease under Art.
1687 of the Civil Code;
3. There is a stipulation against renewal (Agalo-os
v. IAC, G.R. No. L-67220, May 7, 1987);
4. Invalidity of original lease (Estate of Santos v.
De Veyra, G.R. No. L-30027, July 31, 1969);
5. Acceptance of rentals beyond original term (DE
LEON, supra at 669);
6. Acceptance of rentals less than amounts
stipulated (DE LEON, supra at 788); and
7. Non-payment of rentals (Rivera v. Roman, G.R.
No. 142402, September 20, 2005).
Effects:
1. The period of the new lease is not that stated in
the original contract but the time established in
Articles 1682 and 1687 of the Civil Code (CIVIL
CODE, Art. 1670);
2. Accessory obligations contracted by a third
person are extinguished (CIVIL CODE, Art.
1672); and
NOTE: The renewal of the lease is, in effect, a
novation of the original contract of lease (CIVIL
CODE, Art. 1291).
3. Other terms of the original contract are revived
(CIVIL CODE, Art. 1670).
NOTE: Terms that are revived are only those
which are germane to the enjoyment of
possession (e.g. amount of rent, date of
payment, care of the property, etc.), but not
those with respect to special agreements which
are by nature foreign to the right of occupancy
or enjoyment inherent in a contract of lease –
such as an option to purchase the leased
premises (Dizon v. Magsaysay. G.R. No. L-
23399, May 31, 1974).
PURCHASE OF THE LEASED
PROPERTY (CIVIL CODE, Art. 1676)
GENERAL RULE: Purchaser of thing leased can
terminate lease (CIVIL CODE, Art. 1676, par. 1).
EXCEPTIONS:
1. Lease is recorded in Registry of Property;
REASON: An unrecorded lease is terminable at
the will of the new owner who is an innocent
purchaser for value.
2. There is a stipulation in the contract of sale that
purchaser shall respect the lease until
termination of its period;
3. Purchaser has actual knowledge of the
existence of the lease;
REASON: Such is equivalent to registration
4. Sale is fictitious; there is a disputable
presumption that it is fictitious if the sale is not
registered (CIVIL CODE, Art. 1676, par. 3);
5. Sale is made with right of repurchase (CIVIL
CODE, Art. 1677).
NOTE: The buyer may make use of the power to
oust the lessee if any of the grounds for ejectment
under Article 1673 is present. (DE LEON, supra at
805)
GROUNDS FOR JUDICIAL EJECTMENT
UNDER ART. 1673 OF THE CIVIL CODE:
(ENVI)
1. Expiration of the period agreed upon or the
period under Arts. 1682 and 1687 of the Civil
Code;
2. Non-payment of the rentals agreed upon;
3. Violation of any of the conditions agreed upon in
the contract; and
4. Improper use or enjoyment by the lessee of the
thing leased.
NOTE: In all cases except number 1, for the case of
unlawful detainer to prosper, a demand to pay and
vacate should be given to the lessee (Racaza v.
Gozum, G.R. No. 148759, June 8, 2006).
An alternative notice to pay an increased rental or
vacate the premises is not the demand
contemplated by the Rules of Court in unlawful
detainer cases. Hence, if the lessee elects to stay,
he merely assumes the new rental and until he
defaults in said obligation, he cannot be ejected
(Vda. De Murga v. Chan, G.R. No. L-24680, October
7, 1968).
A notice or demand to vacate does not have to
expressly use the word “vacate” as it suffices that the
demand letter puts the lessee or occupant on notice
that if he does not pay the rentals or comply with the
terms of the lease contract, he should move out of
the leased premises (Irao v. By the Bay, Inc., G.R.
No. 177120, July 14, 2008).
The ejectment of tenants of agricultural lands is
governed by special laws (CIVIL CODE, Art 1673).
For a tenancy relationship to exist between the
parties, the following elements must concur: (a) the
parties are the landowner and the tenant; (b) the
subject matter is an agricultural land; (c) there is
consent between the parties; (d) the purpose is
agricultural production; (e) there is personal
cultivation by the tenant; and (f) there is sharing of
the harvests between the parties (Quintos v.
Department Of Agrarian Reform Adjudication Board
and Kanlurang Mindoro Farmer’s Cooperative, Inc.,
G.R. No. 185838, February 10, 2014).
PRELIMINARY MANDATORY
INJUNCTION TO RESTORE
POSSESSION
In ejectment cases where an appeal is taken, the
lessor is entitled to a writ of preliminary injunction to
restore him in his possession in case the higher
court is satisfied that the lessee’s appeal is frivolous
or dilatory (i.e. without merit) or the lessor’s appeal
is prima facie meritorious. The period of ten (10)
days shall be counted from the time the appeal is
perfected (CIVIL CODE, Art. 1674).
REASON: To put an end to the then state of the law
which unjustly allowed the lessee to continue in
possession during an appeal to the higher court
(Report of the Code Commission, supra at 143).
GROUNDS FOR THE TERMINATION OF
THE LEASE:
1. By the expiration of the period (CIVIL CODE, Art.
1673, par. 1);
2. When the lessor has no right to enter into a lease
contract (e.g. when the lessor is not the owner
or has no authority or right to lease the property)
(Ballesteros v. Abion, G.R. No. 143361,
February 9, 2006);
3. By the will of the purchaser or transferee of the
thing (CIVIL CODE, Art. 1676, par. 1);
4. By total loss of the thing (CIVIL CODE, Art.
1655);
5. By rescission due to non-performance of the
obligation of one of the parties set forth in Arts.
1654 and 1657 of the Civil Code (CIVIL CODE,
Art. 1659); or
6. In case the dwelling place or any other building
is unfit for human habitation and is dangerous to
life or health (CIVIL CODE, Art. 1660).
Question: Upon the termination of the lease, the
lessee claims reimbursement for the improvements
introduced on the property alleging that they were
made in good faith. Will the claim prosper?
Suggested Answer: No. To be entitled to
reimbursement for improvements introduced on the
property of another, he must be a builder in good
faith. A builder in good faith is one who is unaware
of any flaw on his title. A lessee cannot claim to be
a builder in good faith because he knows that his
occupation would continue only for the life of the
lease (Josefa v. Buenaventura, G.R. No. 163429,
March 3, 2006).
SUBDIVISION AND
CONDOMINIUM BUYERS
PROTECTIVE DECREE
(P.D. NO. 957)
Date Approved: July 12, 1986
PURPOSE
To afford its inhabitants the requirements of a decent
human settlement and to provide them with ample
opportunities for improving their quality of life (DE
LEON, supra at 531).
NATIONAL HOUSING AUTHORITY
It shall have exclusive jurisdiction to regulate real
estate trade and business in accordance with the
provisions of this decree (hereinafter referred to as
“the authority”) (P.D. 957, Sec. 3).
NOTE: Under E.O. 648 of 1981, the implementation
of P.D. 957 was transferred from the National
Housing Authority (NHA) to the Housing and Land
Use Regulatory Board (HLURB).
REGISTRATION OF PROJECTS
The registered owner of a parcel of land who wishes
to convert the same into a subdivision project shall
submit his subdivision plan to the Housing and
Land Use Regulatory Board, which shall act upon
and approve the same, upon a finding that the plan
complies with the Subdivision Standards and
Regulations enforceable at the time the plan is
submitted. The same procedure shall be followed in
the case of a plan for a condominium project except
that, in addition, said Authority shall act upon and
approve the plan with respect to the building or
buildings included in the condominium project in
accordance with the National Building Code (P.D.
957, Sec. 4).
The subdivision plan, as so approved, shall then be
submitted to the Director of Lands for approval in
accordance with the procedure prescribed in Section
44 of the Land Registration Act (Act 496, as
amended by R.A. 440): Provided, that in case of
complex subdivision plans, court approval shall no
longer be required. The condominium plan as
approved shall be submitted to the Register of
Deeds of the province or city in which the property
lies and shall be acted upon subject to the conditions
and in accordance with the procedure prescribed in
Section 4 of the Condominium Act (R.A. 4726).
LICENSE TO SELL
Such owner or dealer to whom a registration
certificate has been issued shall not be authorized to
sell any subdivision lot or condominium unit in the
registered project unless he has obtained a license
to sell the project within two weeks from the
registration of such project (P.D. 957, Sec. 5).
PERFORMANCE BOND
No license to sell subdivision lots or condominium
units shall be issued by the NHA unless the owner
or dealer shall have filed an adequate performance
bond approved by said Authority to guarantee the
construction and maintenance of the roads, gutters,
drainage, sewerage, water system, lighting systems,
and full development of the subdivision project or the
condominium project, and the compliance by the
owner or dealer with the applicable laws and rules
and regulations (P.D. No. 957, Sec. 6).
EXEMPT TRANSACTIONS
A license to sell and performance bond shall not be
required in any of the following transactions:
1. Sale of a subdivision lot resulting from the
partition of land among co-owners and co-heirs.
2. Sale or transfer of a subdivision lot by the
original purchaser thereof and any subsequent
sale of the same lot.
3. Sale of a subdivision lot or a condominium unit
by or for the account of a mortgagee in the
ordinary course of business when necessary to
liquidate a bona fide debt (P.D. 957, Sec. 7).
SUSPENSION OF LICENSE TO SELL
Upon verified complaint by a buyer of a subdivision
lot or a condominium unit in any interested party, the
Authority may, in its discretion, immediately suspend
the owner's or dealer's license to sell pending
investigation and hearing of the case.
The Authority may motu proprio suspend the license
to sell if, in its opinion, any information in the
registration statement filed by the owner or dealer is
or has become misleading, incorrect, inadequate or
incomplete or the sale or offering for a sale of the
subdivision or condominium project may work or
tend to work a fraud upon prospective buyers.
The suspension order may be lifted if, after notice
and hearing, the Authority is convinced that the
registration statement is accurate or that any
deficiency therein has been corrected or
supplemented or that the sale to the public of the
subdivision or condominium project will neither be
fraudulent not result in fraud. It shall also be lifted
upon dismissal of the complaint for lack of legal
basis (P.D. 957, Sec. 8).
GROUNDS FOR THE REVOCATION OF
REGISTRATION OF THE CERTIFICATE
AND LICENSE TO SELL OF OWNERS OR
DEALERS: (Not-Mi-VIBE)
1. Does Not conduct his business in accordance
with law or sound business principles; or
2. Has made any Misrepresentation in any
prospectus, brochure, circular or other literature
about the subdivision project or condominium
project that has been distributed to prospective
buyers; or
3. Has Violated any of the provisions of this Decree
or any applicable rule or regulation of the
Authority, or any undertaking of his/its
performance bond; or
4. If Insolvent; or
5. Is of Bad business repute; or
6. Has been or is Engaged or is about to engage in
fraudulent transactions (P.D. 957, Sec. 9).
REGISTERS OF SUBDIVISION LOTS
AND CONDOMINIUM UNITS
A record of subdivision lots and condominium units
shall be kept in the authority, wherein all orders of
the authority shall be entered. The registers shall be
open for public inspection within reasonable hours
as promulgated by the authority (P.D. 957, Sec. 10).
REGISTRATION OF DEALERS,
BROKERS, AND SALESMEN
No real estate dealer, broker or salesman shall
engage in the business of selling subdivision lots or
condominium units unless he has registered himself
with the Authority in accordance with the provisions
of this section (P.D. 957, Sec. 11).
GROUNDS FOR THE REVOCATION OF
REGISTRATION AS DEALERS,
BROKERS OR SALESMEN: (V-Ma-FUCh)
1. Has Violated any provision of this Decree or any
rule or regulation made hereunder; or
2. Has Made a material false statement in his
application for registration; or
3. Has been guilty of a Fraudulent act in connection
with any sale of a subdivision lot or condominium
unit; or
4. Has demonstrated his Unworthiness to transact
the business of dealer, broker, or salesman, as
the case may be.
5. In case of Charges against a salesman, notice
thereof shall also be given the broker or dealer
employing such salesman (P.D. 957, Sec. 12).
Pending hearing of the case, the Authority shall have
the power to order the suspension of the dealer's,
broker's, of salesman's registration; provided, that
such order shall state the cause for the suspension
(P.D. 957, Sec. 12).
THE CONDOMINIUM
ACT
(R.A. NO. 4726)
Date Approved: June 18, 1966
(See discussion under Property).
NOTE: Any transfer or conveyance of a unit or an
apartment, office or store or other space therein,
shall include the transfer or conveyance of the
undivided interests in the common areas or, in a
proper case, the membership or shareholdings in the
condominium corporation: Provided, however, That
where the common areas in the condominium
project are owned by the owners of separate
units as co-owners thereof, no condominium
unit therein shall be conveyed or transferred to
persons other than Filipino citizens, or
corporations at least sixty percent of the capital
stock of which belong to Filipino citizens, except
in cases of hereditary succession. Where the
common areas in a condominium project are held by
a corporation, no transfer or conveyance of a unit
shall be valid if the concomitant transfer of the
appurtenant membership or stockholding in the
corporation will cause the alien interest in such
corporation to exceed the limits imposed by existing
laws (R.A. 4726, Sec. 5).
RENT CONTROL ACT
(R.A. NO. 9653)
Date approved: July 14, 2009
PURPOSE: To encourage the development of
affordable housing for the lower income brackets
and other beneficiaries and to protect them from
unreasonable rent increases (R.A. 9653, Sec. 2).
Coverage:
1. All residential units in the National Capital
Region and other highly urbanized cities, the
total monthly rent for each of which ranges from
one peso (P1.00) to ten thousand pesos
(P10,000.00).
2. All residential units in all other areas the total
monthly rent for each of which ranges from one
peso (P1.00) to five thousand pesos (5,000.00).
EXCEPT: Already existing contracts (R.A. 9653,
Sec. 5).
EXCEPTION: Rent-to-Own Scheme –at the option
of the lessor, he or she may engage the lessee in a
written rent-to-own agreement that will result in the
transfer of ownership of the particular dwelling in
favor of the latter (R.A. 9653, Sec. 11).
LIMIT ON INCREASE IN RENT
For a period of one (1) year from effectivity, no
increase shall be imposed on the rent of any
residential unit covered by this Act.
After such period until December 31, 2013, the rent
shall not be increased by more than seven percent
(7%) annually as long as the unit is occupied by the
same lessee.
When the residential unit becomes vacant, the
lessor may set the initial rent for the next lessee.
In case of boarding houses, dormitories, rooms, and
bed spaces offered to students, no increase in rental
more than once per year shall be allowed (R.A.
9653, Sec. 4).
Notwithstanding the lapse of the period, the Housing
and Urban Development Coordinating Council
(HUDCC) is granted the authority to continue the
regulation of rental of certain residential units, to
determine the period of regulation and its
subsequent extensions if warranted (R.A. 9653, Sec
6).
DEFINITION OF TERMS (R.A. 9653, Sec. 3)
Rent
Is the amount paid for the use or occupancy of a
residential unit whether payment is made on a
monthly or other basis.
Residential Unit
Shall refer to an apartment, house and/or land on
which another’s dwelling is located and used for
residential purposes and shall include not only
buildings, part or units thereof used solely as
dwelling places, boarding houses, dormitories,
rooms and bed spaces offered for rent by their
owners, except motels, motel rooms, hotels, hotel
rooms but also those used for home industries, retail
stores or other business purposes if the owner
thereof and his or her family actually live therein and
use it principally for dwelling purposes.
Immediate members of family of the lessee or
lessor
For purposes of repossessing the leased premises,
are limited to his or her spouse, direct descendants
or ascendants, by consanguinity or affinity.
Lessee
Is the person renting a residential unit.
Owner/Lessor
Includes the owner or administrator or agent of the
owner of the residential unit.
Sublessor
Is the person who leases or rents out a residential
unit leased to him by an owner.
Sublessee
Is the person who leases or rents out a residential
unit from a sublessor (R.A. 9653, Sec. 3).
RENT AND REQUIREMENT OF A BANK
DEPOSIT
Rent shall be paid in advance within the first five (5)
days of every current month or the beginning of the
lease agreement unless the contract provides for a
later date of payment (R.A. 9653, Sec. 7).
LESSOR IS PROHIBITED:
1. To demand more than one (1) month advance
rent; and
2. To demand more than two (2) months deposit,
which shall be kept in a bank under the lessor’s
account name during the entire duration of the
lease agreement.
Any and all interest that shall accrue shall be
returned to the lessee at the expiration of the lease
contract.
In the event that the lessee fails to:
1. Settle rent, electric, telephone, or other utility
bills; or
2. Destroys any house components or
accessories.
The deposits and interests shall be forfeited in favor
of the latter in the amount commensurate to the
pecuniary damage done by the former (R.A. 9653,
Sec. 7).
ASSIGNMENT OF LEASE OR
SUBLEASING
Assignment of lease or subleasing of the whole or
any portion of the residential unit, including the
acceptance of boarders or bed spacers, without the
written consent of the owner or lessor is prohibited
(R.A. 9653, Sec. 8).
GROUNDS FOR JUDICIAL EJECTMENT:
(Ex-AURA)
1. Expiration of the period of the lease contract;
(R.A. 9653, Sec. 9)
2. Assignment of lease or subleasing of residential
units in whole or in part, including the
acceptance of boarders or bed spacers, without
the written consent of the owner/lessor;
3. Legitimate need of the owner / lessor to
repossess his share or her property for his or her
own Use or for the use of any immediate
member of his family as a residential unit
Conditions:
a. The lease for a definite period has expired;
b. The lessor has given the lessee formal
notice three (3) months in advance of the
lessor’s intention to repossess the property;
c. The owner/lessor is prohibited from leasing
the residential unit or allowing its use by a
third party for a period of at least one (1)
year from the time of repossession
4. Need of the lessor to make necessary Repairs
of the leased premises which is the subject of an
existing order of condemnation by appropriate
authorities concerned in order to make the said
premises safe and habitable
Conditions:
a. After said repair, the lessee ejected shall
have the first preference to lease the same
premises;
b. The new rent shall be reasonably
commensurate with the expenses incurred
for the repair of the said residential unit;
c. That if the residential unit is condemned or
completely demolished, the lease of the new
building will no longer be subject to the
aforementioned first preference rule.
5. Arrears in payment of rent for a total of three (3)
months. In case of refusal by the lessor to accept
payment of the rent agreed upon, the lessee
may either deposit, by way of consignation, the
amount in court or with the city or municipal
treasurer, as the case may be, or barangay
chairman, or in a bank in the name of and with
notice to the lessor, within one (1) month after
the refusal of the lessor to accept payment.

Lessee shall thereafter deposit the rent within

ten (10) days of every current month. Failure to
deposit the rent for three months shall constitute
a ground for ejectment.

The lessor, upon authority of the court in case of

consignation or upon joint affidavit by him and
the lessee to be submitted to the city or
municipal treasurer or barangay chairman and
to the bank where deposit was made, shall be
allowed to withdraw the deposits;

PROHIBITION AGAINST EJECTMENT

BY REASON OF SALE OR MORTGAGE
No lessor or his successor in interest shall be
entitled to eject the lessee upon the ground that the
leased premises have been sold or mortgaged to a
third person regardless of whether the lease or
mortgage is registered or not (R.A. 9653, Sec. 10).

APPLICATION OF THE CIVIL CODE AND

RULES OF COURT
Except when the lease is for a definite period, the
provision of paragraph (1) of Article 1673 of the Civil
Code, insofar as they refer to residential units
covered by this Act, shall be suspended during the
effectivity of this Act, but other provisions of the Civil
Code and the Rules of Court on lease contracts,
insofar as they are not in conflict with the provisions
of this Act shall apply (R.A. 9653, Sec. 12).

PENALTIES:
1. A fine not less than P25,000.00 nor more than
P50,000.00;
2. Imprisonment of not less than one month and
one day to not more than six months; or
3. Both (R.A. 9653, Sec. 13).
 DISTINCT CHARACTERISTIC OF A
AGENCY CONTRACT OF AGENCY:
1. Representative Character
– In a contract of agency, the agent acts as a
representative of the principal, and not for
A contract of agency is one whereby a person
himself;
(agent) binds himself to render some service or to do
something in representation or on behalf of another
2. Derivative authority (Id. at 334); and
(principal), with the consent or authority of the latter
(NEW CIVIL CODE, Art. 1868).
3. The agent’s power to bring about business
relations between his principal and third persons
CHARACTERISTICS OF AN AGENCY is the most distinctive mark of the agent, as
CONTRACT: (PF-BORN-CP) contrasted with others who act in representative
1. Preparatory; capacity but are not agents (Id. at 353).
2. Fiduciary;
3. Bilateral (but may be unilateral); PARTIES TO THE CONTRACT OF
4. Onerous (generally); AGENCY:
5. Representative Relation;
6. Nominate; 1. Principal
7. Consensual; and – One whom the agent represents and from
8. Principal (5 PARAS, supra at 770-771). whom he derives authority (DE LEON, supra at
335);

a. He must be capacitated to enter into a

NATURE, FORM, AND contract.
b. He may be a natural or juridical person
KINDS OF AGENCY c. The agent is not liable where he was
ignorant of the principal’s incapacity (DE
ARTS. 1868-1883 LEON, supra at 338-339).

2. Agent
NATURE OF AN AGENCY
It is both a contract and a representative relation (DE
LEON, Comments and Cases on Partnership,
Agency, and Trusts (2019), p.332) [hereinafter DE
LEON, Partnership, Agency, & Trusts]).
Exception to Contractual Nature
Agency may be created by operation of law (DE
LEON, supra, at 333).
– One who acts for and represents another (Id. at
335).
a. Insofar as third person is concerned –
capacity of the principal is enough (DE
LEON, supra at 340)
b. Insofar as the obligations of an agent to
his principal is concerned – the agent
must be able to bind himself
c. Some mental capacity is necessary as
an agent. Therefore, those who are
absolutely incapacitated such as insane

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA R. TAMPUS, Vice
Chairperson for Secretariat | ARVY KEITH N. CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice
Chairperson for Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. THERESA GENEVIEVE NUEVE-CO and Atty. LUIS MANUEL BUGAYONG

 or demented persons cannot become an
agent (DE LEON, supra at 341).
PURPOSE OF AN AGENCY
To extend the personality of the principal through the
facility of the agent. It enables the activity of man
which is naturally limited in its exercise by the
impositions of his physiological conditions to be
legally extended by permitting him to be
constructively present in many different places and to
perform diverse juridical acts and carry on many
different activities through another when physical
presence is impossible or inadvisable at the same
time (DE LEON, supra at 334-335).
ELEMENTS OF AN AGENCY: (COC-RW)
1. Consent, express or implied
a. Express
A person may express his consent through a
contract either orally or in writing (NEW CIVIL
CODE, Art. 1868).
b. Implied
A person may impliedly express his consent
through his conducts (NEW CIVIL CODE,
Art. 1869); or through ratification (NEW CIVIL
CODE, Art. 1910).
NOTE: Consent may also arise by
presumption or operation of law.
c. For a contract of agency to exist, it is
essential that the principal consents that the
other party, the agent, shall act on its behalf,
and the agent consents so as to act. (Apex
Mining Co., Inc v. Southeast Mindanao Gold
Mining Corp., G.R. No. 152613, June 23,
2006).
d. A principal must be capacitated or have a
legal capacity to enter into a contract. The
agent’s capacity is usually immaterial; he
does not have to possess full capacity to act
for himself insofar as third persons are
concerned (DE LEON, supra at 338-340).
Thus, even one under legal disability (e.g.,
minor), whose contracts are not binding upon
him, may act as an agent and bind his
principal. But in some instances, additional
qualifications may exist, the lack of which
may void a relationship (e.g., lawyer to
represent in legal matters) (Id. at 341).
e. Any person or entity having juridical capacity
and capacity to act and not otherwise
disqualified, may enter into an agency.
f. Insofar as his obligations to his principal are
concerned, the agent must be competent to
bind himself. The extent to which an agent is
a fiduciary and is subjected to duties and
liabilities to his principal depends upon his
capacity (Id.).
g. In an agent-principal relationship, the
personality of the principal is extended
through the facility of the agent. In so doing,
the agent, by legal fiction, becomes the
principal, authorized to perform all acts which
the latter would have him do. Such a
relationship can only be effected with the
consent of the principal, which must not, in
any way, be compelled by law or by any court
(Orient Air Services and Hotel
Representatives v. Court of Appeals, G.R.
Nos. 76931 & 76933, May 29, 1991).
2. Object
– Execution of a juridical act in relation to a third
person;
3. Cause
– May be onerous or gratuitous but presumed for
compensation (NEW CIVIL CODE, Art. 1875);
It is not necessary that there is a consideration
for the relationship to be created.
4. The agent acts as Representative of the
principal and not for himself;
The acts of the agent on behalf of the principal,
within the scope of his authority (NEW CIVIL
CODE, Art. 1881), produce the same legal and
binding effects as if they were personally done by
the principal.
5. The agent acts Within the scope of his
authority (DE LEON, supra at 336).
The agent must act as a representative and not
for himself, and must act within the scope of his
authority (NEW CIVIL CODE, Art. 1881).
ACTS THAT MAY BE DELEGATED TO AN
AGENT
GENERAL RULE: What a man may do in person, he
may do through another (DE LEON, supra at 342).
EXCEPTIONS:
1. Personal Acts (e.g., right to vote, making of a will)
2. Criminal Acts or acts not allowed by law if done
by the principal (e.g., ownership of private
agricultural lands by aliens through an agent,
persons prohibited to acquire a property by
reason of position or relation to the person cannot
do the same through the mediation of another,
 participation in the commission of a crime) (Id. at (Id. at 367-368).
343).
AGENCY AND LEASE OF SERVICES,
KNOWLEDGE OF AGENT IS IMPUTED TO DISTINGUISHED
PRINCIPAL LEASE OF
GENERAL RULE: The knowledge of the agent is AGENCY
SERVICES
imputed to the principal even though the agent never
communicated such knowledge to the principal (DE As to Basis
LEON, supra at 351).
Principle of
Principle of
NOTE: Knowledge of the principal cannot be imputed representation is
employment is applied.
to his agent (Sunace International Management applied.
Services, Inc. v. NLRC, G.R. No. 161757, January
25, 2006). As to Extinguishment

EXCEPTIONS: (ABC) Extinguished at will of

Concurrence of parties
1. Where the agent’s interest is Adverse to those of the principal or the
is necessary.
the principal; agent.
2. Where the person claiming the Benefit of the rule
colludes with the agent to defraud the principal; As to Exercise of Power
and
Employee exercises
3. Where the agent’s duty is not to disclose the Agent exercises
ministerial functions
information, as where he is informed by way of discretionary power.
only.
Confidential information (DE LEON, supra at
352). As to Kind

SALE Preparatory contract. Principal contract.

By a contract of sale, one of the contracting parties (Id. at 355-356; PARAS, supra at 777).
obligates himself to transfer the ownership of and to
deliver a determinate thing, and the other to pay
therefore a price certain in money or its equivalent AGENCY AND TRUST,
(NEW CIVIL CODE, Art. 1458). DISTINGUISHED
AGENCY TRUST
AGENCY TO SELL AND SALE,
DISTINGUISHED As to basis
AGENCY TO SELL SALE Contract. Contract or law.
As to Ownership As to extinguishment
Agent receives the The buyer receives the May be revoked Is terminated upon the
goods as the goods of goods as owner. anytime. accomplishment of its
the principal. purpose.
As to Payment As to title

Agent delivers the Buyer pays the price. Agent does not hold title Trustee holds title over
proceeds of the sale. over the property the property subject of a
subject of agency. trust agreement.
As to Power to Return
As to representative capacity
Agent can return the The buyer, as a rule,
object in case he is cannot return the object Agent acts in the name The trustee may act on
unable to sell it. sold. of his principal. his own name.

As to Control of the Object of Sale
Bound to act according The buyer can deal with
to the instructions of his the thing as he pleases
principal. being the owner.
Agent has authority to The trustee does not
represent the principal. have authority to bind
the trustor.
 b. Compensated or onerous (NEW CIVIL
AGENCY TRUST
CODE, Art. 1875).
As to property
3. As to extent of Scope of business
May or may not involve Trust always involves covered
a property. control over property. a. General – comprises all the business of the
(5 PARAS, supra at 780). principal;
b. Special – comprises one or more specific
transactions (NEW CIVIL CODE, Art. 1876).
AGENCY AND GUARDIANSHIP,
DISTINGUISHED 4. As to Authority conferred
AGENCY GUARDIANSHIP a. Couched in general terms - one which is
created in general terms and is deemed to
As to Creation comprise only acts of administration (NEW
CIVIL CODE, Art. 1877);
Founded upon consent Created irrespective of b. Couched in specific terms.
of the parties thereto. the consent or capacity
of the ward. 5. As to its Nature and effects
a. Ostensible / representative - agent acts in the
As to Representation
name and in representation of the principal;
Agent represents a A guardian represents b. Simple / commission - agent acts in his own
person who has the an incapacitated name but for the account of the principal (DE
capacity to contract for person. LEON, supra at 380).
himself.
FORMS OF AGENCY
As to Authority GENERAL RULE: There are no formal requirements
governing the appointment of an agent. It may be oral
Agent derives his Guardian does not or written and may also be in public or private writing
authority from his derive his authority (NEW CIVIL CODE, Art. 1869).
principal. from the ward.
1. Express;
As to Appointment
2. Implied:
Appointment of an agent Guardian is appointed a. From the acts of the principal;
is derived from contract. by the court and b. From his silence or lack of action; to
stands in loco parentis. repudiate the agency knowing that another
Agent’s power may at person is acting on his behalf without
any time be abrogated or Legal guardian may be authority (NEW CIVIL CODE, Art. 1869); and
modified by the principal. substituted by law. c. If the principal delivers his power of attorney
to the agent and the latter receives it without
As to Power of Control any objection (NEW CIVIL CODE, Art. 1871).

Agents are subject to the Not subject to the

control of their principals. direction of their EXCEPTION:
wards. 1. When the law requires a specific form (e.g., sale
of a piece of land or any interest therein thru an
(DE LEON, supra. at 377).
agent), authority of the agent shall be in writing,
otherwise, the sale is void (NEW CIVIL CODE,
KINDS OF AGENCY: (C2SAN) Art. 1874).
1. As to Manner of Creation
a. Express: Is the rule provided in Article 1874 in conflict
i. Oral or Verbal with the rule under Article 1403 no. 2, par. E?
ii. Written – when the law requires a Under Article 1874, the authority of the agent in
specific form (NEW CIVIL CODE, Art. selling a piece of land or any interest therein shall
1869, par. 2). be in writing, otherwise, the sale shall be void.
b. Implied. While Article 1403 provides that the sale of real
property or any interest therein shall be in writing,
2. As to its Character otherwise the sale shall be unenforceable.
a. Gratuitous;
 Thus, Article 1874 provides that the authority of b. When the principal entrusts to him by letter
the agent in selling a piece of land or any interest or telegram a power of attorney with respect
therein shall be in writing. While Article 1403, on to the business in which he is habitually
the other hand, speaks of the transaction itself or engaged as an agent, and he did not reply
the contract instituted by the agent with the third to the letter or telegram (NEW CIVIL CODE,
person on behalf of the principal that should be in Art. 1872).
writing.
DISTINCTIONS BETWEEN ART. 1872
2. When it is required to make the contract effective EXCEPTION A AND B
against third persons (DE LEON, supra at 381).
EXCEPTION A EXCEPTION B
3. When it is required for the purpose of proving the
existence of the contract (Id.). As to Agent

Engaged for the first Habitually engaged.

In an implied agency, the principal is still bound by
time.
the acts of the agent just as in case of express
agency. As to Reply or Objection
NOTE: It is not essential that the agent should be Replies or No reply at all.
appointed directly by the principal, but the acknowledges receipt
appointment may be made through another, as by without any objection.
referring an applicant to another and representing
that he has authority to act, or the relation may arise
out of an agreement to employ the agent of another, DISTINCTIONS BETWEEN ARTICLE
such person then becoming an agent of the first party 1871 AND ARTICLE 1872
(DE LEON, supra at 378).
ARTICLE 1871 ARTICLE 1872
FORMS OF ACCEPTANCE BY AGENT: As to Condition of Creation
Acceptance by the agent may also be express or
implied from his acts which carry out the agency, or When created, both the
When created, both
from his silence or inaction according to the principal and the agent
principal and agent are
circumstances (NEW CIVIL CODE, Art. 1870). are absent.
present
1. Express; and
2. Implied: As to Manner of Delivery
a. From his acts which carry out the agency; or
The power of attorney is The power of attorney
b. From his silence or inaction according to the
personally delivered by is not personally
circumstances (NEW CIVIL CODE, Art.
the principal to the agent delivered. There is
1870).
transmission by
messenger, or by letter
KINDS OF IMPLIED ACCEPTANCE: or telephone.
1. Between persons who are present (NEW
(PINEDA, supra at 263).
CIVIL CODE, Art. 1871);
a. Principal delivers his power of attorney to the
agent; and PRESUMPTION OF AGENCY
b. Agent receives it without any objection. GENERAL RULE: Agency is not presumed

“Present” – meaning “face to face” or conversing with EXCEPTIONS:

each other through mobile cellphone (5 PARAS
supra at 787).
2. Between persons who are absent (NEW
CIVIL CODE, Art. 1872), the acceptance of the
agency cannot be implied from the silence of the
agent, except:
a. When the principal transmits his power of
attorney to the agent, who receives it
without any objection;
1. By operation of law
2. To prevent unjust enrichment (DE LEON, supra
at 384).
POWER OF ATTORNEY
It is an instrument in writing by which one person, as
principal, appoints another as his agent, and confers
upon him the authority to perform certain specified
acts or kinds of acts in behalf of the principal (DE
LEON, supra at 388).
PURPOSE: Not to define the authority of the agent is what he appears to be (Cuison v. Court of Appeals,
but to evidence the authority of the agent to third G.R. No. 88539, October 26, 1993).
parties with whom the agent deals (Id.).
REQUISITES FOR AGENCY BY
Except as may be required by statute, a power of ESTOPPEL: (MARC)
attorney is valid even though no notary public
intervened in its execution (Angeles v. Phil. National 1. The principal Manifested a representation of the
Railways, G.R. No. 150128, August 31, 2006). agent's authority or knowingly allowed the agent
to assume such authority;
2. The third person, in good faith, Relied upon such
EFFECTS OF SPECIAL INFORMATION representation; and
OR PUBLIC ADVERTISEMENT 3. Relying upon such representation, such third
If a person specially informs another or states by person has Changed his position to his detriment.
public advertisement that he has given a power of (Litonjua v. Eternit Corporation, G.R. NO.
attorney to a third person, the latter thereby becomes 144805, June 08, 2006).
a duly authorized agent, in the former case with
respect to the person who received the special ESTOPPEL TO DENY AGENCY:
information, and in the latter case with regard to any
1. Estoppel of agent
person.
– One professing to act as agent may be
estopped to deny agency both against the
The power shall contribute to be in full force until the
asserted principal and third persons.
notice is rescinded in the same manner in which it
was given (NEW CIVIL CODE, Art. 1873).
2. Estoppel of principal
a. As to agent – if he knows that another is
MANNER OF TERMINATION OR acting as his agent and fails to repudiate his
RESCISSION OF AGENCY CREATED acts or accepts the benefits of them.
UNDER ARTICLE 1873 b. As to sub-agent – he must have known or be
The power of attorney created under Art. 1873 shall charged with the knowledge of the fact of
continue to exist and be effective until the notice transaction and terms of agreement between
(information or advertisement) had been rescinded in the agent and sub-agent.
the same manner in which it was given (PINEDA,
supra at 267). 3. Estoppel of third persons
– A third person, having dealt with one as an
If the agency has been entrusted for the purpose of agent may be estopped to deny the agency as
contracting with specified persons, its revocation against the principal, agent, or third persons in
shall not prejudice the latter if they were not given interest. He will not, however, be estopped where
notice thereof (NEW CIVIL CODE, Art. 1921). he has withdrawn from the contract made with
the unauthorized agent before receiving any
If the agent had general powers, revocation of the benefits thereunder.
agency does not prejudice third persons who acted in
good faith and without knowledge of the revocation. 4. Estoppel of the government
Notice of the revocation in a newspaper of general – The government is neither estopped by the
circulation is a sufficient warning to third persons mistake or error on the part of its agents. But it
(NEW CIVIL CODE, Art. 1922). may be estopped through affirmative acts of its
officers acting within the scope of their authority
Revocation made in any manner is effective where (DE LEON, supra at 395).
the person dealing with the agent has actual
knowledge thereof; otherwise, bad faith and fraud AGENCY BY ESTOPPEL AND IMPLIED
would be committed (DE LEON, supra at 393).
AGENCY, DISTINGUISHED
To forestall fraud, a revocation made in any manner AGENCY BY IMPLIED
shall be effective against all persons having actual ESTOPPEL AGENCY
knowledge thereof (5 PARAS, supra at 789).
As to Proof
RULE ON AGENCY BY ESTOPPEL
To be proved from
One who clothes another with apparent authority as Should be restricted to
deductions or
his agent, and holds him out to the public as such, cases where authority is
inferences from other
cannot be permitted to deny the authority of such not real but apparent.
facts.
person in good faith, and in the honest belief that he
 v. Eternit Corporation, G.R. No. 144805, June 8,
As to Reliance by Third Persons
2006).
Reliance by third Reliance is not
persons in good faith is necessary. RULE ON BROKER’S COMMISSION
necessary. GENERAL RULE: A broker is never entitled to
commission for unsuccessful efforts. Even if the
As to Existence of Actual Agency broker is responsible for making the owner and the
possible buyer to meet and discuss the terms, if no
There is no agency at There is actual agency. sale was consummated, he is not entitled to a
all, but the one The Principal alone is commission (DE LEON, supra at 404).
assuming to act as liable.
agent has apparent or EXCEPTION: The broker should be paid his
ostensible, although not commission where he is the efficient procuring cause
real, authority to in bringing the sale (Manotok Brothers v Court of
represent another. Appeals, G.R. No. 94753, April 7, 1993).
As to Nature of Authority
When there is a close, proximate and causal
An apparent agent has Agent has actual connection between the agent's efforts and the sale
none of the rights of an authority to act on of the property, the agents are entitled to their
agent, except where the behalf of the principal. commission (Ticong v. Malim, G.R. No. 220785.
principal’s conduct or March 1, 2017).
representations are
such that the agent LIABILITY OF PRINCIPAL TO PAY
reasonably believed COMPENSATION:
that the principal 1. Amount
intended him to act as – the principal must pay the agent the
agent in the matter. compensation agreed upon, or the reasonable
(DE LEON, supra. at 396-397). value of the agent’s services, if no compensation
was specified (DE LEON, supra at 403).
AGENCY FOR COMPENSATION
GENERAL RULE: Agency is presumed to be for 2. Compliance by agent with his obligations
compensation (NEW CIVIL CODE, Art. 1875). – the liability of the principal to pay commission
presupposes that the agent has complied with his
EXCEPTION: Unless there is proof to the contrary. obligation as such to the principal (Id. at 404).

NOTE: The relation of principal and agent can be
created although the agent receives no
compensation (DE LEON, supra at 403).
GRATUITOUS AGENT
A person who agrees to act as an agent without
compensation. The promise of a gratuitous agent is
ordinarily not enforceable but the fact that he is such
has no effect upon his rights and duties with
reference to the principal and third persons. The fact
that the agency was for compensation or not, shall be
considered by the court in determining the extent of
liability of agent for fraud or negligence (Id.).
REAL ESTATE BROKER
A real estate broker is one who negotiates the sale of
real properties. His business, generally speaking, is
only to find a purchaser who is willing to buy the land
upon terms fixed by the owner. He has no authority
to bind the principal by signing a contract of sale.
Indeed, an authority to find a purchaser of real
property does not include an authority to sell (Litonjua
3. Procuring Cause of the transaction
Governing Rule: The agent must prove that he
was the guiding cause or the “procuring cause”
(DE LEON, supra at 405).
Procuring Cause
A cause originating a series of events which,
without break in their continuity, result in the
accomplishment of the prime objective of the
employment of the broker – producing a
purchaser ready, willing and able to buy on the
owner’s terms (Ticong v. Malim, G.R. No.
220785. March 1, 2017).
4. Evasion of commission in bad faith
5. Compensation contingent on profits
6. Reduction by principal of overprice
7. Termination of agency contract
8. Grant of compensation on equitable
ground
9. Right of agent’s companion to
compensation
10. Validity of exclusive sales agency GENERAL AGENT SPECIAL AGENT
agreement (DE LEON, supra at 407-410).
As to Construction of Instructions of Principal
CLASSES AND KINDS OF AGENTS:
Statement of principal Authority of agent must
1. Universal Agent with respect to the be strictly pursued.
– one authorized to do all acts for his principal
agent’s authority would
which can lawfully be delegated to an agent. So
ordinarily be regarded
far as such a condition is possible, such an agent
as advisory only.
may be said to have universal authority.
As to Termination of Authority
2. General Agent
– one authorized to do all acts pertaining to a Apparent authority does Mere revocation is
business of a certain kind or at a particular place, not terminate by the effective to terminate
or all acts pertaining to a business of a particular mere revocation of his the authority as to third
class or series. He usually has authority either authority without notice persons because the
expressly conferred in general terms or in effect to the third party. third person has a duty
made general by the usages, customs or nature to inquire.
of the business which he is authorized to
(DE LEON, supra at 415-418).
transact.

3. Special or Particular Agent AGENCY COUCHED IN GENERAL AND

– one authorized to do some particular act or to SPECIAL TERMS
act upon some particular occasion. He acts According to the power or authority conferred, the
usually in accordance with specific instructions or agency may be:
under limitations necessarily implied from the
nature of the act to be done (Siasat v. IAC, G.R. 1. Couched in general terms; or
No. L-67889, October 10, 1985). An agency couched in general terms comprises
only acts of administration, even, even if the
GENERAL AGENT AND SPECIAL principal should state that he withholds no power
AGENT, DISTINGUISHED or that the agent may execute such acts as he
may consider appropriate, or even though the
GENERAL AGENT SPECIAL AGENT agency should authorize a general and unlimited
management (NEW CIVIL CODE, Art. 1877).
As to Scope of Authority
NOTE: It includes only acts of administration and
Usually authorized to do Authorized to do only
express power is necessary to perform any act of
all acts connected with acts in pursuance of
strict ownership (NEW CIVIL CODE, Art. 1878;
the business or particular instructions or
Yoshizaki v. Joy Training Center of Aurora, Inc.,
employment in which he with restrictions
G.R. No. 174978, July 31, 2013).
is engaged. necessarily implied
from the acts to be
Acts of Administration
done.
Acts of administration are those which do not
As to Extent by Which Agent May Bind imply the authority to alienate (DE LEON, supra
Principal at 419).

Binds his principal by an Cannot bind his
act within the scope of principal in a manner
his authority although it beyond or outside the
may be contrary to his specific acts which he is
special instructions. authorized to perform
on behalf of the
principal.
As to Continuity
Conducts a series of Usually involves a property in question, and did not include or
transactions involving a single transaction or a
continuity of service. series of transactions
not involving continuity.
The power of administration does not include
acts of disposition or encumbrance, which are
acts of strict ownership. As such, an authority to
dispose cannot proceed from an authority to
administer, and vice versa, for the two powers
may only be exercised by an agent by following
the provisions on agency of the Civil Code (from
Article 1876 to Article 1878). Specifically, the
apparent authority of Atty. Parulan, being a
special agency, was limited to the sale of the
extend to the power to administer the property
(Sps. Aggabao v. Parulan, G.R. No. 165803,
September 01, 2010).
2. Couched in specific terms under special
power of attorney (NEW CIVIL CODE, Art.
1878).
INSTANCES WHERE SPA IS
NECESSARY (NEW CIVIL CODE, ART.
1878): (PECWEM-LLB-BOCARO)
1. To make Payments as are not usually
considered as acts of administration;
Payment is the delivery of money or the
performance in any other manner of an
obligation. It is an act of ownership because it
involves the conveyance of ownership of money
or property (DE LEON, supra at 426).
When payment is made in the ordinary course of
management, it is an act of administration (Id. at
426).
NOTE: If the payment is usually considered an
act of administration, no special power of
attorney is needed. It should be noted, however,
that some acts of administration carry with them
the exercise of acts of dominion, e.g., the sale by
an administrator of fertile land or the products of
the land (5 PARAS, supra at 800).
2. To Effect novations which put an end to
obligations already in existence at time
the agency was constituted;
Novation is the extinction of an obligation
through the creation of a new one which
substitutes it by changing the object of principal
conditions thereof, substituting a debtor or
subrogating another in the right of the creditor
(NEW CIVIL CODE, Art. 1291).
The obligations must already be in existence at
the time of the constitution of the agency (5
PARAS, supra at 801).
3. To Compromise, submit questions to
arbitration, renounce the right to appeal
from a judgment, waive objections to the
venue of an action or abandon a
prescription already acquired (CAAWA);
There are five (5) different powers mentioned
here. A right given regarding one is not enough
to grant the others (5 PARAS, supra at 801).
Compromise
It is a contract whereby the parties, by making
reciprocal concessions, avoid a litigation or put
an end to one already commenced (NEW CIVIL
CODE, Art. 2028).
Arbitration
It is where parties submit their controversies to
one or more arbitrators for a decision (DE LEON,
supra at 427).
NOTE: The absence of an SPA does not mean
that the compromise agreement is void for it is
merely unenforceable (Dungo v. Lopena, G.R.
No. L-18377, December 29, 1962).
An agent cannot waive: the right to appeal from
a judgment; objections to the venue of an action;
prescription already acquired by the principal
(PINEDA, supra at 293).
4. To Waive any obligation gratuitously;
This is condonation or remission (NEW CIVIL
CODE, Art. 1270). The agent cannot waive a
right belonging to the principal without
consideration (DE LEON, supra at 428).
Express condonation shall comply with the forms
of donation (NEW CIVIL CODE, Art. 1270). The
waiver is an act of ownership (PINEDA, supra at
294).
5. To Enter into any contract by which the
ownership of an immovable is
transmitted or acquired either
gratuitously or for a valuable
consideration.
The conveyance of an immovable, whether for a
valuable consideration or gratuitously, is an act
of ownership. Special power of attorney is
needed to validly effect such conveyances
(PINEDA, supra at 295).
NOTE: The authority of an agent to execute a
contract of sale of real estate must be conferred
in writing and must give him specific authority,
either to conduct the general business of the
principal or to execute a binding contract
containing terms and conditions which are in the
contract he did execute (Cosmic Lumber
Corporation v. CA, G.R. No. 114311, November
29, 1996).
The special power of attorney mandated by law
must be one that expressly mentions a sale or
that includes a sale as a necessary ingredient of
the authorized act. A special power of attorney
must express the powers of the agent in clear
and unmistakable language for the principal to
confer the right upon an agent to sell real estate.
When there is any reasonable doubt that the
language so used conveys such power, no such
construction shall be given the document
(Yoshizaki v. Joy Training Center of Aurora, Inc.,
G.R. No. 174978, July 31, 2013).
 Absence of Written Authority
It has been repeatedly held that the absence of a
written authority to sell a piece of land is ipso jure,
void, precisely to protect the interest of an
unsuspecting owner from being prejudiced by the
unwarranted act of another (Pahud v. CA, G.R.
No. 160346, August 25, 2009).
6. To Make gifts, except customary ones for
charity or those made to employees in the
business managed by the agent;
GENERAL RULE: Gifts are donations. A
donation is an act of liberality whereby a person
disposes of a thing or right in favor of another
who accepts it. It is an act of ownership. Hence a
special power of attorney is necessary.
EXCEPTION: Gifts which are customary for
charity or given to employees in the business
managed by the agent (PINEDA, supra at 297).
7. To Loan or borrow money, unless the
latter act be urgent and indispensable for
the preservation of the things which are
under administration;
The mere act of the principal of giving pre-signed
checks to the agent is not authority for the agent
to loan in the name of the principal. In the
absence of any authorization, Gutierrez could not
enter into a contract of loan in behalf of the
petitioner (Patrimonio v. Gutierrez, G.R. No.
187769, June 04, 2014).
The same principle applies to the act of
borrowing money. Without a SPA, the agent
cannot lend or borrow money in behalf of the
principal (Rural Bank of Caloocan v. CA, G.R.
No. L-32116, April 21, 1981).
The power to borrow money is one of those
cases where corporate officers as agents of the
corporation need a special power of attorney.
Therefore, there was no basis to hold the
corporation liable since there was no authority
given to borrow money (Yasuma v. Heirs of de
Villa, G.R. No. 150350, August 22, 2006).
The rule is that the agent cannot borrow money
without a SPA except when the funds are
necessary and indispensable for the preservation
of the property being administered by the said
agent (PINEDA, supra at 297).
8. To Lease any real property to another
person for more than one year;
The special power of attorney is necessary
because a lease for more than one (1) year
creates a real right. (PINEDA, supra at 298).
If the lease is not for more than one (1) year, it is
merely an act of administration provided it is not
registered (Id.).
The principal is the lessor and not the lessee
(Id.).
NOTE: The lease here does not refer to lease of
real property from another person and to lease of
personal property (DE LEON, supra at 432).
The requirement of special power of attorney
extends to renewal or extension of lease of real
property to another (Id.).
9. To Bind the principal to render some
service without compensation;
While the agent may agree to render some
service without compensation, he cannot without
authority bind his principal to do so, unless he is
given a special power to that effect. This is
tantamount to bind him to render service without
compensation. This is involuntary servitude
(PINEDA, supra at 298).
10. To Bind the principal in a contract of
partnership;
By the contract of partnership, the partners bind
themselves to contribute money, property or
industry to a common fund with the intention of
dividing the profits among themselves (NEW
CIVIL CODE, Art. 1767). The contract of
partnership thus creates obligations the
fulfillment of which requires an act of strict
ownership (DE LEON, supra at 432).
Furthermore, the principal must personally have
trust and confidence in the proposed partners.
(Id.).
11. To Obligate the principal as guarantor or
surety;
By the contract of guaranty, the guarantor binds
himself to the creditor to fulfill the obligation of the
principal debtor in case the latter should fail to do
so (NEW CIVIL CODE, Art. 2047). A contract of
guaranty is unenforceable unless it is made in
writing (NEW CIVIL CODE, Art. 1403 par. 2(b)).
This is an act of ownership because to fulfill the
obligation, there may be a need to pay in cash or
property (PINEDA, supra at 299).
In suretyship, the surety binds himself solidarily
with the principal debtor. The creditor can make
the surety personally liable for the debt of the
principal debtor (Trade and Investment
Development Corp. of the Phil v. Asia Paces
Corp., G.R. No. 187403, February 12, 2014).
This is an act of strict ownership (PINEDA, supra
at 299).
12. To Create or convey real rights over
immovable property;
An agent cannot create real rights (i.e. usufruct,
mortgage, voluntary easement etc.) over the
immovable property of his principal without a
special power of attorney. This is an act of strict
ownership. With more reason, an agent cannot
convey same real rights. Both acts constitute acts
of strict ownership. A special power is needed
(Id.).
13. To Accept or repudiate an inheritance;
Any person having the free disposal of his
property may accept or repudiate an inheritance
(NEW CIVIL CODE, Art. 1044). This act is one of
strict dominion; hence, the necessity of a special
authority (DE LEON, supra at 434).
14. To Ratify or recognize obligations
contracted before the agency;
An agent cannot effect novation of obligations
existing at the time of the constitution of the
agency unless he be specially authorized to do
so. Also, the agent cannot ratify or recognize
obligations contracted before the agency without
special power of attorney (Id.).
15. Any Other act of strict dominion.
Included in the general provisions are all acts of
strict dominion not mentioned in the first cases
enumerated in the article (PINEDA, supra at
300).
PRESENTATION OF POWER OF
ATTORNEY
A third person with whom the agent wishes to
contract on behalf of the principal may require the
presentation of the power of attorney or the
instructions as regards the agency. Private or secret
orders and instructions of the principal do not
prejudice third persons who have relied upon the
power of attorney or instructions shown them (NEW
CIVIL CODE, Art. 1902).
NOTE: It is a settled rule that persons dealing with an
agent are bound at their peril, if they would hold the
principal liable, to ascertain not only the fact of
agency but also the nature and extent of authority,
and in case either is controverted, the burden of proof
is upon them to establish it. If he does not make such
an inquiry, he is chargeable with knowledge of the
agent’s authority and his ignorance of that authority
will not be any excuse. The principal, on the other
hand, may act on the presumption that third persons
dealing with his agent will not be negligent in failing
to ascertain the extent of his authority as well as the
existence of his agency. (Manila Memorial Park
Cemetery, Inc. v. Linsangan, G.R. No. 151319,
November 22, 2004).
SPA under Art. 1878 need not be in writing
As long as the mandate is express, such authority
may be either oral or written. The authority must be
duly established by competent and convincing
evidence other than the self-serving assertion of the
party claiming that such authority was verbally given,
thus: The requirements of a special power of attorney
in Article 1878 of the Civil Code and of a special
authority in Rule 138 of the Rules of Court refer to the
nature of the authorization and not its form. The
requirements are met if there is a clear mandate from
the principal specifically authorizing the performance
of the act (Patrimonio v. Gutierrez, G.R. No. 187769,
June 04, 2014).
SPECIAL POWERS OF ATTORNEY
Even if a document is titled as a general power of
attorney, the requirement of a special power of
attorney is met if there is a clear mandate from the
principal specifically authorizing the performance of
the act. There was no need to execute a separate and
special power of attorney since the general power of
attorney had expressly authorized the agent or
attorney in fact the power to sell the subject
property. The special power of attorney can be
included in the general power when it is specified
therein the act or transaction for which the special
power is required (Bravo-Guerrero v. Bravo, G.R. No.
152658, July 29, 2005).
Effect of Lack of SPA Where One Is Required
The contract is unenforceable (NEW CIVIL CODE,
Art. 1403).
SCOPE OF AGENT’S AUTHORITY
The scope of the agent’s authority is what appears in
the written terms of the power of attorney. While third
persons are bound to inquire into the extent or scope
of the agent’s authority, they are not required to go
beyond the terms of the written power of attorney.
Third persons cannot be adversely affected by an
understanding between the principal and his agent as
to the limits of the latter’s authority. In the same way,
third persons need not concern themselves with
instructions given by the principal to his agent outside
the written power of attorney (Siredy Enterprises, Inc.
v. Court of Appeals, et al. G.R. No. 129039,
September 17, 2002).
SCOPE OF AUTHORITY TO SELL
Special power to sell excludes the power to
mortgage; and a special power to mortgage does not
include the power to sell (NEW CIVIL CODE, Art.
1879).
The power or authority to sell by virtue of the
extrajudicial foreclosure of the REM could not be
necessarily implied from the text of
paragraph, expressing the petitioners' agreement to
the extrajudicial foreclosure (Baysa v. Plantilla, G.R.
No. 159271, July 13, 2015).
LIMITATION OF POWER TO
COMPROMISE
A special power of attorney to compromise does not
authorize submission to arbitration (NEW CIVIL
CODE, Art. 1880).
REASON: A special power to compromise does not
authorize submission to arbitration because while the
principal may have the trust and confidence in the
judgment of his agent, he may not have the same
trust and confidence on the designate arbitrators
(PINEDA, supra at 301).
To authorize a person to submit the principal’s
transactions in question to arbitration, there must be
a special power of attorney to that effect (NEW CIVIL
CODE, Art. 1878, par. 3). Thus, if the principal has
designated the names of the arbitrators to arbitrate,
the agent cannot submit the matter in controversy to
the other arbitrators (Cox v. Fay 54 Vt. 446). If there
is no designation, the agent may submit the matter in
question to any arbitrator (PINEDA, supra at 302).
WHEN A PRINCIPAL IS BOUND BY ACT
OF THE AGENT:
1. Agent must act within the scope of his authority
(NEW CIVIL CODE, Art. 1881); and
2. Agent must act in behalf of the principal (DE
LEON, supra at 447).
NOTE: The limits of the agent’s authority shall not be
considered exceeded should it have been performed
in a manner more advantageous to the principal than
that specified by him (NEW CIVIL CODE, Art. 1882).
AUTHORITY
It is the power of the agent to affect the legal relations
of the principal by acts done in accordance with the
principal’s manifestation of consent to him (DE
LEON, supra at 441).
NOTE: Authority may be considered as the source or
cause, while power is the effect (Id.).
KINDS OF AUTHORITY
1. Actual
- may be express or implied; the principal is
bound by the acts of the agent on his behalf (Id.
at 443).
a. Express – directly conferred by words,
either orally or in writing
b. Implied – incidental or reasonably
necessary to accomplish the main
purpose of the agency or enable the
agent to perform his assigned duties.
2. Apparent or ostensible
- The doctrine of apparent authority provides that
even if no actual authority has been conferred on
an agent, his or her acts, as long as they are
within his or her apparent scope of authority, bind
the principal. However, the principal's liability is
limited to third persons who are reasonably led to
believe that the agent was authorized to act for
the principal due to the principal's conduct
(Calubad v. Ricarcen Development Corp., G.R.
No. 202364, August 30, 2017).
3. General
– refers to all the business of the principal.
4. Special
– limited only to one or more specific
transactions; and
5. Emergency or authority by necessity or
operation of law (DE LEON, supra at 443-
444).
WHEN A PRINCIPAL IS NOT BOUND BY
ACT OF THE AGENT (ID. AT 448):
1. Agent acts without or beyond the scope of his
authority in the principal’s name; and
2. Agent acts within the scope of his authority but in
his own name, except when the transaction
involves a thing belonging to the principal (NEW
CIVIL CODE, Art. 1883, par. 2).
REASON: There is no representation of the
principal (DE LEON, supra at 448).
EFFECTS OF AGENT’S ACTS:
1. With Authority
a. In principal’s name – valid; principal is
bound; agent not personally liable unless he
expressly bound himself or exceeded the
limits of his authority without giving such
party sufficient notice of his powers (NEW
CIVIL CODE, Art. 1897);
Illustration:
P authorized A to sell his (P’s) car. A then
sold the car in P’s name. (5 PARAS, supra at
812).
b. In his own name – apply Article 1883;
generally not binding on the principal; agent
and stranger are the only parties, except
regarding things belonging to the principal or
when the principal ratifies the contract or
derives benefit therefrom.
Illustration – GENERAL RULE:
If P authorized A to find for him (P) a singing
engagement at the Manila Grand Opera
 House, and A acts in his own (A’s) behalf, ACTS OF THE AGENT AND VALIDITY OF
that is, A wanted to sing and he got the job, THE CONTRACT
only A and the Opera House would be bound
to each other. Validity of the Contract

Illustration – EXCEPTION: Agent Is Agent Is

P authorized A to sell his (P’s) car. A then Acting in the Acting in His
Acts of the
sold the car in his (A’s) own name, without Name of the Own Name
Agent
disclosing who the principal was. Ordinarily, Principal
the agent can only have recourse against the
As to the As to the
buyer, and the buyer can have recourse only
Principal Agent
against the agent under Article 1883.
However, in this particular case, since the car Valid and Valid (NEW
belonged to the principal, P can have Within binding (NEW CIVIL CODE,
recourse against the buyer and the buyer can
Authority CIVIL CODE, Art. 1883)
have recourse against agent P(Id.). Art. 1897)
2. Without Authority Unenforceable Valid
a. In principal’s name – unauthorized & (NEW CIVIL
unenforceable but may be ratified by the In Excess/ CODE, Art.
principal, in which case, may be validated Beyond 1403 par. 1)
retroactively from the beginning (NEW CIVIL Authority
CODE, Art. 1407); Void (NEW
CIVIL CODE,
Illustration: Without P’s authority, A sold P’s Art. 1898)
car to a buyer in P’s behalf. The transaction,
insofar as P is concerned is unauthorized, No agency Valid but no
hence unenforceable (NEW CIVIL CODE, (NEW CIVIL agency.
Art. 1403, par. 1). P is therefore not bound, CODE, Art. Deemed as
unless he ratifies the transaction. Without the Without 1403 par. 1) an ordinary
necessary ratification, the buyer can have a Authority contract –
claim only against the alleged agent A. The since there is
moment a ratification is made, A steps out of no principal,
the picture, since he would no longer be there is no
personally liable, and now it is P who will agent.
have to deal with the buyer (5 PARAS, supra
at 812). NOTE: If the party with whom the agent contracted is
aware of the limits of the powers granted by the
b. In his own name – valid, whether or not the principal (in bad faith), the contract is void; otherwise
subject matter belongs to the principal; (in good faith), the contract is unenforceable (NEW
Provided, that at the time of delivery, the CIVIL CODE, Art. 1898).
“agent” can legally transfer the ownership of
the thing. Otherwise, he will be held liable for
breach of warranty against eviction; Art. 1883
WHEN THE PRINCIPAL IS BOUND BY
does NOT apply (Id. at 811). THE ACTS OF THE AGENT BEYOND THE
LATTER’S POWERS: (De-LiBRa)
Illustration: 1. Where the principal’s acts have contributed to
A, without authority from P, and representing Deceive a third person in good faith;
himself to be the owner of P’s car, sold it to a 2. Where the Limitations upon the power created by
buyer. Here, A acted without authority. him could not have been known by the third
Moreover, he acted in his own behalf. It is person (DE LEON, supra at 450).
clear that the transaction (sale) is valid 3. Where the principal has placed in the hands of
provided that at the time delivery is to be the agent instruments signed by him in Blank
made, the “agent” can transfer legally the (Strong v. Repide, G.R. No. L-7154, February 21,
ownership of the thing. Otherwise, he will be 1912);
held liable for breach of warranty against 4. Contracts entered into by a corporate president
eviction. It is also clear that only A is liable to without prior board approval binds the
an innocent purchaser. Here, Article 1883 corporation when such officers’ apparent
does not apply because Article 1883 authority is established and when these contracts
presupposes authority (Id. at 812). are ratified by the corporation. (People’s Aircargo
 vs.. Court of Appeals, G.R. No. 117847, October
7, 1998);
5. Where the principal has Ratified the acts of the
agent (DE LEON, supra at 451).
DOCTRINE OF AGENCY BY NECESSITY
If there is an emergency to meet, the authority of the
agent is expanded to cover the exigencies of the
moment.
Requisites: (ECARC)
1. The real existence of an Emergency;
2. Inability of the agent to Communicate with the
principal;
3. Exercise of the additional Authority for the
principal’s own protection;
4. The adoption of fairly Reasonable means,
premises duly considered; and
5. The Ceasing of the authority the moment the
emergency no longer demands the same
(PINEDA, supra at 305).
NOTE: Strictly speaking, agency can never be
created by necessity; what is created is additional
authority in an agent appointed and authorized before
the emergency arose (5 PARAS, supra at 819).
AGENCY WITH AN UNDISCLOSED
PRINCIPAL
GENERAL RULE: Agent is directly liable to the
person with whom he had contracted as if the
transaction were his own.
EXCEPTION: Contract that involves things belonging
to the principal (NEW CIVIL CODE, Art. 1883, par. 2).
Art. 1883 pertains to the act of an agent who is
authorized, but instead of acting in behalf of the
principal, he acts in his own behalf. Art. 1883 does
not apply if the agent was unauthorized or he acts in
excess “of his authority” (5 PARAS, supra at 822-
823).
Undisclosed Principal
Is one whom the other party dealing with the agent
has no notice of the fact that the said agent is acting
for a principal (PINEDA, supra at 308).
REASON: To protect third persons against possible
collusion between the agent and the principal. It
applies only when the agent has, in fact, been
authorized by the principal to enter into the particular
transaction, but the agent, instead of contracting for
and in behalf of the principal, acts in his own name
(DE LEON, supra at 455).
OBLIGATIONS OF THE AGENT
ARTS. 1884-1909
GENERAL OBLIGATIONS OF AN AGENT
TO PRINCIPAL: (ObAE)
1. To Obey all lawful orders and instructions of
principal within the scope of the agency
2. To Act with utmost good faith and loyalty for
furtherance of principal’s interests; and
3. To Exercise reasonable care, skill and diligence
(DE LEON, supra at 462-464).
SPECIFIC OBLIGATIONS OF AN AGENT
TO PRINCIPAL: (CAFOA-DALAR–PAID-
BIR)
1. To Carry out the agency which he has
accepted (NEW CIVIL CODE, Art. 1884);
The provision is clear that an agent is bound to
carry out the agency. The relationship existing
between principal and agent is a fiduciary one,
demanding conditions of trust and confidence. It
is the duty of the agent to act in good faith for the
advancement of the interests of the principal. In
this case, BPI had the obligation to carry out the
agency by informing the beneficiary, who
appeared before BPI to withdraw funds of the
insured who was BPI's depositor, not only of the
existence of the insurance contract but also the
accompanying terms and conditions of the
insurance policy in order for the beneficiary to be
able to properly and timely claim the benefit (BPI
v. Laingo, G.R. No. 205206, March 16, 2016).
EXCEPTION: An agent shall not carry out an
agency if its execution would manifestly result in
loss or damage to the principal (NEW CIVIL
CODE, Art. 1888).
2. To Answer for damages which through
his non-performance the principal may
suffer (NEW CIVIL CODE, Art. 1884);
This rule is an application of the general rule in
contracts that any person guilty of fraud,
negligence, or delay in the fulfillment of his
obligation, or who in any other manner fails to
comply with the terms thereof shall be liable for
damages (NEW CIVIL CODE, Art. 1170).
It is a well-settled rule that an agent is also
responsible for any negligence in the
performance of its function and is liable for
damages which the principal may suffer by
reason of its negligent act. Hence, the Court of
Appeals erred when it opined that BA, being the
principal, had no cause of action against PAL, its
 agent or sub-contractor (British Airways v. CA,
G.R. No. 121824, January 29, 1998).
3. To Finish the business already begun on
the death of the principal should delay
entail any danger (NEW CIVIL CODE, Art.
1884);
4. To Observe diligence of a good father of
a family in the custody and preservation
of the goods forwarded to him by the
owner in case he declines an agency until
an agent is appointed (NEW CIVIL CODE,
Art. 1885);
GENERAL RULE: When a person declines the
offer to make him an agent, generally, no contract
of agency arises and thereby no obligation is
assumed by such person to the offeror based on
the absence of privity.
EXCEPTION: Art. 1885 provides for an
exception as when the offeree, in spite of his
refusal to accept the appointment, assumes
certain liabilities (VILLANUEVA, supra at 129).
The duty of care over goods given to his custody
can only cover a “reasonable period” because
the law provides that “the owner shall as soon as
practicable either appoint an agent or take
charge of the goods” (Id.).
5. To Advance the necessary funds should
there be a stipulation to do so (NEW CIVIL
CODE, Art. 1886);
EXCEPTION: The agent is not bound to provide
the funds if the principal is insolvent (NEW CIVIL
CODE, Art.1886).
6. Not to carry out the agency if its
execution would manifestly result in loss
or Damage to the principal (NEW CIVIL
CODE, Art. 1888);
NOTE: Notice that the article covers only acts
that would “manifestly” lead to losses, in other
words, the agent cannot be a guarantor that the
principal would suffer no loss or damage in the
pursuit of the agency; the sustaining of losses
due to human error is part of the risk that every
owner or principal assumes (VILLANUEVA,
supra at 134).
Of the established rules under the Code, one
cannot be more basic than the obligation of the
agent to carry out the purpose of the agency
within the bounds of his authority. Though he
may perform acts in a manner more
advantageous to the principal than that specified
by him, in no case shall the agent carry out the
agency if its execution would manifestly result or
damage to the principal. Wincorp had no
authority to absolve Power Merge from the
latter's indebtedness to its lenders. Doing so
therefore violated the express terms of the SPAs
that limited Wincorp's authority to contracting the
loan (Virata v. Ng Wee, G.R. 220926, July 05,
2017).
7. To Answer for damages if there being a
conflict between his interest and those of
the principal, he should prefer his own
(NEW CIVIL CODE, Art. 1889);
Art. 1889 does not declare the contract or
transaction the agent entered into as void, but
merely makes the agent liable for damages
suffered by the principal (VILLANUEVA, supra at
139).
NOTE: Where the agent’s interests are superior,
such as where he has a security interest in goods
of the principal in his possession, he may protect
this interest even if in so doing he disobeys the
principal’s orders or injures his interest (DE
LEON, supra at 478-479).
Remedy when an Agent Wishes to Prefer His
Own Interest: He must timely renounce the
agency, provided his renunciation is not for the
purpose of profiting from the transaction
(PINEDA, supra at 321).
8. Not to Loan to himself if he has been
authorized to lend money at interest (NEW
CIVIL CODE, Art. 1890);
EXCEPTION: When the principal consents to the
same (NEW CIVIL CODE, Art. 1890).
If the agent has been expressly empowered to
borrow money, he may himself be the lender at
the current rate of interest. (DE LEON, supra at
479).
REASON: The principal will suffer no prejudice
because the principal, just the same, will be liable
to pay interest (Id.).
9. To render an Account of his transactions
and to deliver to the principal whatever he
may have received by virtue of the
agency, even though it may not be owing
to the principal (NEW CIVIL CODE, Art.1891);
All profits made and advantage gained by the
agent in the execution of the agency belong to
the principal. And it matters not whether such
profit or advantage be the result of the
performance or of the violation of the duty of the
agent if it be the fruit of the agency (Dumaguin v.
Reynolds, G.R. No. L-3572, September 30,
1952).
Stipulation Exempting Agent from Duty to
Account is Void
REASON: It is contrary to public policy (NEW
CIVIL CODE, Art. 1306) as it would encourage
fraud. It is in the nature of an action for future
fraud which is void (PINEDA, supra at 326).
The agent has an absolute duty to make a full
disclosure or accounting to his principal of all
transactions and material facts that may have
some relevance with the agency (Domingo v.
Domingo, G.R. No. L-30573, October 29, 1971).
Obligation to Account NOT Applicable:
(SLIM)
a. In cases of Solutio indebiti (PINEDA, supra
at 326);
b. Where a right of Lien exists in favor of the
agent, the rule is not also applicable (DE
LEON, supra at 486).
i. The agent may, under Art.1914, retain in
pledge the things which are the object of
the agency until the principal effects the
reimbursement and pays the indemnity
provided in Arts. 1912 and 1913.
ii. A lawyer shall have a lien upon the
funds, documents and papers of his
client and may retain the same until his
lawful fees and disbursements have
been paid (RULES OF COURT, Rule
138, Sec. 37).
c. Neither would the rule apply if the agent or
broker had Informed the principal of the gift
or bonus or profit he received from the
purchaser and his principal did not object
thereto (DE LEON, supra at 486).
d. The duty embodied in Art. 1891 will not apply
if the agent or broker acted only as a
Middleman with the task of merely bringing
together the vendor and the vendee, who
themselves thereafter will negotiate on the
terms and conditions of the transaction
(Domingo v. Domingo, G.R. No. L-30573,
October 29, 1971).
NOTE: An agent who takes a secret profit is
guilty of breach of his loyalty and forfeits his right
to collect the commission. It does not even matter
if the agency was a gratuitous one, or that the
principal obtained better results, or that usage or
custom allows a receipt of such bonus (Domingo
v. Domingo, G.R. No. L-30573, October 29,
1971).
Report Distinguished from Accounting
a. Report imports a statement of collections.
b. Accounting means settling of account of
administration or agency, which includes
payment (DE LEON, supra at 487).
AGENT AND BANK TELLER,
DISTINGUISHED
AGENT BANK TELLER
As to Right to Possession
Has independent and Has no independent
autonomous right. right, payment to him is
payment to the bank
itself. He is a mere
custodian.
As in Case of Misappropriation
He is guilty of estafa. He is guilty of qualified
theft.
(DE LEON, supra at 488).
10. To be Responsible in certain cases for
the acts
a. Of the substitute appointed by him when:
i. He was not given the power to appoint
one; and
ii. He was given such power, but without
designating the person, and the person
appointed was notoriously incompetent
or insolvent (NEW CIVIL CODE, Art.
1892);
11. To Pay interest on funds he has applied
to his own use (NEW CIVIL CODE, Art. 1896);
Two Cases in Contemplation of the Rule:
a. The sum belonging to the principal which he
applied to his own use; and
b. The sum that the agent still owed the
principal after the extinguishment of the
agency (NEW CIVIL CODE, Art. 1896).
12. To Act in accordance with the
instructions of the principal, and in
default thereof, to do all that a good father
of a family would do (NEW CIVIL CODE, Art.
1887);
Note: Acting in accordance with the instructions
of the principal is different from acting within the
scope of the agent’s authority. The former refers
to the details of the execution of the agency while
the latter refers to the general parameters or
 extent of the agency (PINEDA, supra at 317-
318).
13. To Inform the principal, where an
authorized sale of credit has been made,
of such sale (NEW CIVIL CODE, Art. 1906);
14. To Distinguish goods by countermarks
and designate the merchandise
respectively belonging to each principal,
in the case of a commission agent who
handles goods of the same kind and
mark, which belong to different owners
(NEW CIVIL CODE, Art. 1904);
The commission agent must provide identifying
marks on the goods belonging to different owners
so that segregation may be easy (PINEDA, supra
at 353). He may not commingle goods his
principal’s property with his own or to deal with it
in a way which would make it appear to be his
own property (DE LEON, supra at 530).
15. To Bear the risk of collection, should he
receive also on sale, a guarantee
commission (NEW CIVIL CODE, Art. 1907);
Guarantee Commission or Del Credere
Commission
It is one where the factor or commission agent
guarantees to the principal the payment of debts
arising through his agency in consideration
of an increased or higher commission
(DE LEON, supra at 533).
16. To Indemnify the principal for damages
for his failure to collect the credits of his
principal at the time that they become due
(NEW CIVIL CODE, Art. 1908);
NOTE: Not applicable to guarantee commission
(NEW CIVIL CODE, Art. 1907).
17. To be Responsible for fraud or
negligence (NEW CIVIL CODE, Art. 1909).
OBLIGATION TO CARRY OUT THE
AGENCY
The agent is bound by his acceptance to carry out the
agency and is liable for the damages which, through
his non-performance, the principal may suffer.
He must also finish the business already begun on
the death of the principal, should delay entail any
danger (NEW CIVIL CODE, Art. 1884).
OBLIGATION OF THE PERSON WHO
DECLINES AN AGENCY
If the owner has appointed a person to be his agent
and has forwarded goods to the latter whom he
expected to accept the agency but did not, the latter
is required to observe ordinary diligence in the
custody and preservation of the goods until the owner
thereof has appointed an agent to take care of them.
Failure to do so on the part of the declining person
will render him liable for damages (PINEDA, supra at
316).
DILIGENCE OF A GOOD FATHER OF
FAMILY
A person who declines an agency is still bound to
observe diligence of a good father of a family in the
custody and preservation of the goods forwarded to
him by the owner (NEW CIVIL CODE, Art. 1885).
WHEN AN AGENCY SHOULD NOT BE
CARRIED OUT:
If its execution would manifestly result in loss to the
principal (NEW CIVIL CODE, Art. 1888).
REASON: The duty of the agent who is merely an
extension of the personality of the principal is to
render service for the benefit of the principal and not
to act to his detriment (DE LEON, supra at 477).
AUTHORITY TO BORROW OR LEND
MONEY
1. If he has been expressly empowered to borrow
money, he may himself be the lender at the
current rate of interest (NEW CIVIL CODE, Art.
1890).
REASON: The principal will suffer no prejudice
because even if the agent finds a third person as
lender, the principal just the same will be liable to
pay interest at the current rate or probably more
(PINEDA, supra at 321).
2. If the agent has been authorized to lend money
at interest, he cannot be the borrower without the
consent of the principal (NEW CIVIL CODE, Art.
1890).
REASON: To protect the principal. The agent
may not be a good payer, or may be insolvent, or
may not be a good risk. More, conflict of interests
is bound to arise (PINEDA, supra at 322).
EXCEPTION: When the principal gives his
consent, either orally or in writing (Id.).
The agent may appoint a substitute if the EFFECTS OF SUBSTITUTION
principal has not prohibited him from doing so;
1. Substitution expressly prohibited:
but he shall be responsible for the acts of the
a. All acts of the substitute shall be void (NEW
substitute:
CIVIL CODE, Art.1892, par. 2);
1. When he was not given the power to appoint one;
2. When he was given such power, but without
NOTE: Although Art. 1892 provides that all
designating the person, and the person
acts of the substitute appointed against the
appointed was notoriously incompetent or
prohibition of the principal shall be void, the
insolvent.
contracts are really unenforceable insofar as
the principal is concerned and subject to his
NOTE: In these two cases the principal may further
ratification pursuant to Article 1317 of the
bring an action against the substitute with respect to
New Civil Code (VILLANUEVA, supra at 151-
the obligations that the latter has contracted under
152).
the substitution (NEW CIVIL CODE, Art. 1893).
In a situation where the SPA to sell a piece
All acts of the substitute appointed against the
of land does not empower the attorney-in-
prohibition of the principal shall be void (NEW CIVIL
fact to appoint a substitute, but nevertheless
CODE, Art. 1892).
the agent appoints a substitute who executes
the deed of sale in the name of the principal,
In the cases mentioned in Nos. 1 and 2 of Art. 1892,
while it may be true that the agent may have
the principal may furthermore bring an action against
acted outside the scope of his authority, that
the substitute with respect to the obligations which
did not make the sale void, but merely
the latter has contracted under the substitution (NEW
unenforceable under Art. 1317. Although the
CIVIL CODE, Art. 1893).
principal denied the sale, his acceptance of
the proceeds thereof was tantamount to
SUB-AGENT ratification thereof (Escueta v. Lim, G.R.
A person employed or appointed by an agent as his No.137162, January 24, 2007).
agent, to assist him in the performance of an act for
the principal, which the agent has been empowered b. Agent is personally liable for the acts of the
to perform (DE LEON, supra at 489). substitute, as though the contracts of the
substitute were his own; and
GENERAL RULE: An agent may appoint a sub- c. Principal would have no cause of action
agent. The agent in this situation is a principal with against the substitute (VILLANUEVA, supra
respect to the substitute (Id.). at 153).

REASON: For convenience and practical utility (Id.). 2. Substitution authorized:

a. The substitute was designated by the agent
EXCEPTIONS: – it has the effect of releasing the agent from
1. When prohibited by the principal; his responsibility unless the person
2. When the work entrusted to the agent to carry out appointed is notoriously incompetent or
requires special knowledge, skill or competence insolvent (NEW CIVIL CODE, Art. 1892, par.
(Id.). 2).
b. The substitute was designated by the
EXCEPTION TO THE 2ND EXCEPTION: When principal – absolute exemption of the agent
authorized to do so by the principal (Id.). (DE LEON, supra at 492).

EFFECT OF DEATH OF 3. Substitution not authorized, but not

PRINCIPAL/AGENT prohibited
It will depend from whom the authority of the sub- – if the substitution has occasioned damage to
agent was derived: the principal, the agent shall be primarily
1. From the principal responsible for the acts of the substitute (Serona
– Death of the agent who appointed him does not v. CA, G.R. No. 130423, November 18, 2002).
affect his authority. The principal also has a right of action against the
substitute. (DE LEON, supra at 492).
2. From the agent who appointed him
– Death of the agent terminates his authority (DE RESPONSIBILITY OF TWO OR MORE
LEON, supra at 490). AGENTS
The responsibility of two or more agents, even though
they have been appointed simultaneously, is not
solidary, if solidarity has not been expressly
stipulated (NEW CIVIL CODE, Art. 1894).
JOINT AGENTS
Agents appointed by one or more principals under
such circumstances as to induce the inference that it
was the principal’s intent that all should act in
conjunction in consummating the transaction for
which they were appointed (DE LEON, supra at 494).
Liability of Joint Agents
Their responsibility is joint; except if solidarity has
been expressly stipulated (NEW CIVIL CODE, Art.
1894).
If solidarity has been agreed upon, each agent is
responsible for the:
1. Non-fulfillment of the agency; and
2. Fault or negligence of his fellow agents, unless
the fellow agents acted beyond the scope of their
authority (NEW CIVIL CODE, Art. 1895).
NOTE: The liability referred to in Art. 1894 and 1895
is the liability of agents towards principal and not
towards third parties (5 PARAS, supra at 839).
LIABILITY OF AGENT FOR INTEREST
The agent owes interest on the sums he has applied
to his own use from the day on which he did so, and
on those, which he still owes after the extinguishment
of the agency (NEW CIVIL CODE, Art. 1896).
The agent who converted to his personal use the
funds of the principal is liable for interest by way of
compensation or indemnity (which is different from
interest for delay) which shall be computed from the
day he did so, without prejudice to any criminal action
for the conversion (DE LEON, supra at 496).
While there is no liability for interest on sums which
have not been converted for the agent’s own use (De
Borja vs. De Borja, G.R. No. L-38479, November 20,
1933) the agent who is found to owe the principal
sums after the extinguishment of the agency is liable
for interest from the date the agency is extinguished
(DE LEON, supra at 496).
LIABILITY OF AN AGENT TO THIRD
PERSONS
GENERAL RULE: Agent is not personally liable to
third persons (NEW CIVIL CODE, Art. 1897).
REASON: The agent acquires no rights nor does he
incur any liabilities from the contract entered into by
him on behalf of his principal (DE LEON, supra at
497).
EXCEPTIONS: INSTANCES WHEN
AGENT MAY INCUR PERSONAL
LIABILITY (FOI-WEEP) (NEW CIVIL
CODE, ART. 1897):
1. Fraud and negligence by agent (NEW
CIVIL CODE, Art. 1909);
NOTE: Although the agent becomes personally
liable, this does not mean that the principal is
exempted from liability. Since the acts of the
agent are by law those of the principal, both the
principal and the agent are deemed joint
tortfeasors and are deemed solidarily liable
insofar as third persons are concerned
(VILLANUEVA, supra at 162-163).
The remedy of the principal is to sue the agent
for damages due to agent’s fraudulent or
negligent acts (Id. at 163).
2. Agent acts in his Own name;
EXCEPTION: When the contract involves things
belonging to the principal (NEW CIVIL CODE,
Art.1883, par. 2).
3. A person who acts as an agent of an
Incapacitated principal;
EXCEPTION: Unless the third party was aware
of the incapacity at the time of the making of the
contract (DE LEON, supra at 506).
4. When a person acts as an agent Without
authority or without a principal (Id. at 505);
5. Agent Expressly binds himself;
The individual liability of the agent can be
considered as further security in favor of the
creditor and does not affect or preclude the
liability of the principal; both are liable (Id. at 500).
6. Agent Exceeds his authority; and
NOTE: If the agent contracts in the name of the
principal, exceeding the scope of his authority,
and the principal does not ratify the contract, it
shall be void if the party with whom the agent
contracted is aware of the limits of the powers
granted by the principal. In this case, however the
agent is liable if he undertook to secure the
principal’s ratification (NEW CIVIL CODE, Art.
1898).
NOTE: If the party with whom the agent
contracted is unaware of the limits of the powers
granted by the principal, the contract is
 unenforceable under Article 1403 of the New Civil
Code.
The agent is not bound or liable:
a. When the principal ratifies the act, in which
case, the principal becomes liable.
b. When the agent has given the third person
sufficient notice about the extent of his power
to put him on guard.
c. When the third person is aware of the limits
of the agent’s powers (DE LEON, supra at
500-501).
If the agent acts in excess of his authority,
the principal is not bound insofar as the
excess is concerned. It is unfair if the
principal be bound in a contract which he did
not authorize (PINEDA, supra at 340).
7. Acts of the agent Prevent performance on
the part of the principal (DE LEON, supra at
505).
INSTANCES WHEN THIRD PARTY IS
LIABLE TOWARDS THE AGENT: (CBIT)
1. Where the agent Contracts in his own name for
an undisclosed principal, in which case, the agent
may sue the third party to enforce the contract
(NEW CIVIL CODE, Art. 1883);
2. Where the agent possesses a Beneficial interest
in the subject matter of the agency (NEW CIVIL
CODE, Art. 1927);
3. Where the agent pays money of his principal to a
third party by mistake or under a contract which
proves subsequently to be Illegal, the agent
being ignorant with respect to its illegal nature;
and
4. Where the third party commits a Tort against the
agent (DE LEON, supra at 506).
SCOPE OF AGENT’S AUTHORITY AS TO
THIRD PERSONS
Includes not only the actual authorization conferred
upon the agent by his principal, but also that which
was apparently or impliedly delegated to him
(Angerosa v. The White Company, 210 N.Y.S. 204,
1936 as cited in DE LEON, supra at 509).
1. When authority is not in writing
– Every person dealing with an assumed agent is
put upon an inquiry and must discover upon his
peril, if he would hold the principal liable, not only
the fact of the agency but the nature and extent
of the authority of the agent (DE LEON, supra at
509).
NOTE: If he does not make such inquiry, he is
chargeable with knowledge of the agent’s
authority, and his ignorance of that authority will
not be any excuse (Bacaltos Coal Mines v. CA,
G.R. No. 114091, June 29, 1995).
2. When authority is in writing
– Such person is not required to inquire further
than the terms of the written power of attorney
(DE LEON, supra at 512).
If the duly authorized agent acts in accordance with
the orders of the principal, the latter cannot set up the
ignorance of the agent as to circumstances whereof
he himself was, or ought to have been, aware (NEW
CIVIL CODE, Art. 1899).
So far as third persons are concerned, an act is
deemed to have been performed within the scope of
the agent’s authority, if such act is within the terms of
the power of attorney, as written, even if the agent
has in fact exceeded the limits of his authority
according to an understanding between the principal
and the agent (NEW CIVIL CODE, Art. 1900).
METHODS OF BROADENING AND
RESTRICTING AGENT’S AUTHORITY:
(UNDIE) (DE LEON, supra at 518-520).
1. By Usage and custom;
EXCEPTIONS: (V-DEC)
a. Where it is sought to Vary the terms of an
express authorization;
b. Where it is sought thereby to Dispense with
a legal requirement enacted for the
principal’s benefit;
c. Where it is sought to vary an Essential quality
of the agency relationship; and
d. Where it is sought thereby to Change a rule
of law or as to dispense with a formality
required by law (DE LEON, supra at 519).
It is required that the principal must have notice
of the alleged custom before the agent’s acts
may bind the former. However, a principal is
deemed to have notice of a given usage: (1)
where the principal and the agent reside in the
same community, the usage is definite and well
known and the agent has no notice that he is to
act to the contrary; and (2) where the agent is
authorized to deal in a particular market or
exchange (DE LEON, supra at 519).
2. By Necessity;
Requisites: (EUPRe)
a. The Emergency really exists;
b. The agent is Unable to communicate with the
principal
c. The agent’s enlarged authority is exercised
for the principal’s Protection;
d. The means adopted are Reasonable under
the circumstances (Id. at 520).
3. By certain Doctrines; AUTHORITY
INSTRUCTION
a. Of apparent authority;
b. Of liability by estoppel; and only a private rule of limited in scope and such
c. Of ratification (DE LEON, supra at 520). guidance to the agent limitations are
and is independent themselves part of the
4. By Implication (Id. at 518); or and distinct in authority (NEW CIVIL
character. CODE, Art.1881 and Art.
5. By the rule of Ejusdem generis (Id. at 520). 1882).

RESPONSIBILITY OF PRINCIPAL Refers to the manner Relates to the subject

WHERE AGENT ACTED WITH IMPROPER or mode of his action with which the agent is
with respect to matters empowered to deal or the
MOTIVES which in their kind of business or
GENERAL RULE: The motive of the agent in substance are within transactions upon which
entering into a contract with a third person is the scope of permitted he is empowered to act.
immaterial. action.

EXCEPTIONS: As to Effect of Limitation of Authority

1. Where the third person knew that the agent was
acting for his private benefit (DE LEON, supra at Without significance Limitations of authority
521). as against those are operative as against
2. Where the owner is seeking recovery of personal dealing with the agent those who have or are
property of which he has been unlawfully without knowledge or charged with knowledge
deprived (NEW CIVIL CODE, Art. 559; Dizon v. notice of them of them and ignorance of
Suntay, G.R. No. L-30817, September 29, 1972). because they concern the authority will not be
only the principal and any excuse (see Art.
RATIFICATION BY PRINCIPAL the agent (see Art. 1900).
1902).
A third person cannot set up the fact that the agent
has exceeded his powers, if the principal has ratified, As to Notice to Third Persons
or has signified his willingness to ratify the agent’s
acts (NEW CIVIL CODE, Art.1901). Not expected to be Contemplated to be
made known to those made known to the third
IMPLIED RATIFICATION whom the agent deals person dealing with the
A principal is deemed to have ratified an act of an with. agent. Third persons
agent where he receives and retains the benefits of must therefore verify or
the transaction with knowledge of the material facts investigate the authority.
surrounding the same (DE LEON, supra at 527). (DE LEON, supra at 471-472).

PRESENTATION OF INSTRUCTIONS WHEN DEPARTURE FROM PRINCIPAL’S

GENERAL RULE: A third person is bound to inquire INSTRUCTIONS IS JUSTIFIED: (SAI)
as to the extent of the agent’s authority. A third
person deals with an agent at his peril (NEW CIVIL
1. Sudden Emergency
– Where some unexpected emergency or
CODE, Art. 1902).
unforeseen event occurs which will admit no
delay for communication with the principal, the
EXCEPTION: Private or secret orders or instructions
agent is justified in adopting the course which
of the principal do not prejudice third persons (NEW
seems best to him under the circumstances.
CIVIL CODE, Art. 1902).
2. Ambiguous Instructions
INSTRUCTION AND AUTHORITY, – Where instructions are ambiguous, the agent is
DISTINGUISHED not chargeable with disobedience or its
INSTRUCTION AUTHORITY consequences in case he makes an honest
mistake and adopts a construction different from
As to Nature that intended by the principal. It is the duty of the
principal to couch his instructions in clear terms.
Directs the manner of The sum total of the
transacting the powers committed or 3. Insubstantial Departure
authorized business permitted to the agent by – An agent may not be said to have breached
and contemplates the principal; may be the agency contract by reason of an insubstantial
 departure from the principal’s instructions, which
does not affect the result (DE LEON, supra at
475-476).
FACTOR/COMMISSION AGENT
A person whose business is to receive and sell goods
entrusted to him by the principal for a commission
and is usually selling in his own name (PINEDA,
supra at 351).
The commission agent shall be responsible for the
goods received by him in the terms and conditions
and as described in the consignment, unless upon
receiving them he should make a written statement of
the damage and deterioration suffered by the same
(NEW CIVIL CODE, Art. 1903).
Factorage
Compensation of a factor or commission agent (DE
LEON, supra at 529).
Broker
A middleman or intermediary who, in behalf of others
and for a commission or fee, negotiates or contracts
transactions relating to real or personal property and
never acting in his own name but in the name of those
who employed him (DE LEON, supra at 365).
Commission of Brokers
The brokers are entitled to their commission because
they were instrumental in the sale of the property.
They set the sale in motion (Tan v. Gullas, G.R. No.
143978, December 3, 2002).
In the absence of an express contract between the
broker and his principal, the implication generally is
that the broker becomes entitled to the usual
commissions (Medrano v. Court of Appeals, G.R. No.
150678, February 18, 2005).
Ordinary Commission
It is the compensation for the sale of goods which are
placed in the agent’s possession or at his disposal.
COMMISSION AGENT V.
ORDINARY AGENT V. BROKER
COMMISSION ORDINARY
BROKER
AGENT AGENT
As to Possession of Goods
Needs to have No need to No need to
possession of have have
the goods. possession. possession.
COMMISSION ORDINARY
BROKER
AGENT AGENT
As to Representation
Sells in his own Transacts in Transacts in
name. the name of the name of
the principal. those who
employed him.
(Id. at 365-366; 529)
The commission agent cannot, without the express or
implied consent of the principal, sell on credit. Should
he do so, the principal may demand from him
payment in cash, but the commission agent shall be
entitled to any interest or benefit, which may result
from such sale (NEW CIVIL CODE, Art. 1905).
If such sale is made without authority, the principal is
given two alternatives (NEW CIVIL CODE, Art.1905):
1. He may require payment in cash, in which case
any interest or benefit from the sale on credit
shall belong to the agent since the principal
cannot be allowed to enrich himself at the agent’s
expense;
Illustration: If an agent was authorized to sell a
Godin electric acoustic guitar for P100,000 cash,
but he sells it on credit for P120,000, the principal
can demand from said agent the sum of
P100,000 in cash. However, should the agent
eventually collect the entire sum of P120,000, he
gets an ultimate personal gain of P20,000 (5
PARAS, supra at 845-846).
2. He may ratify the sale on credit in which case it
will have all the risks and advantages to him (DE
LEON, supra at 531).
RULE WHEN THE COMMISSION AGENT
IS AUTHORIZED TO SELL ON CREDIT
Should the commission agent, with authority of the
principal, sell on credit, he shall so inform the
principal, with a statement of the names of the
buyers. Should he fail to do so, the sale shall be
deemed to have been made for cash insofar as the
principal is concerned (NEW CIVIL CODE, Art.
1906).
GUARANTEE COMMISSION
Should the commission agent receive on sale, in
addition to the ordinary commission, another called a
guarantee commission, he shall bear the risk of
collection and shall pay the principal the proceeds of
the sale on the same terms agreed upon with the
purchaser (NEW CIVIL CODE, Art. 1907).
PURPOSE OF THE COMMISSION: To compensate
the agent for the inconveniences and risks he has to
undergo in the collection of the purchase price
payable to the principal (DE LEON, supra at 533).
Liability of the Del Credere Agent
The liability of the del credere agent is contingent. If
the buyer fails to pay, he shall pay the principal. He
has no right to invoke the benefit of excussion (NEW
CIVIL CODE, Arts. 2058-2059) because he is not
really a guarantor. Precisely, he is given an additional
commission for this obligation because he assumes
the risk of collection for the principal (PINEDA, supra
at 357).
The liability of the del credere agent is limited to the
payment of the purchase price. It does not extend to
the other obligations arising from the contract such as
damages (Id.).
Illustration:
The agent was authorized to sell on credit an Ibanez
electric guitar for P40,000 with a 10% ordinary
commission (P4,000). He was also paid guaranteed
commission of 5% (P2,000). His total profit would
therefore be P6,000. However, every time the
customer fails to pay an installment that is due, the
agent himself pays said amount to the principal (5
PARAS, supra at 850).
NOTE: Art. 1907 includes both credit and cash sales
because the law did not make any distinction (Id. at
851).
If the agent receives guarantee commission, he
cannot put the defense that the debtor-third person
possesses property (Id.).
Who may Sue the Buyer who failed to Pay
Either the principal or the del credere agent may sue
the buyer. The suit of one will bar the subsequent suit
of the other (PINEDA, supra at 357).
Duty of Commission Agent
The commission agent who does not collect the
credits of his principal at the time when they become
due and demandable shall be liable for damages,
unless he proves that he exercised due diligence for
that purpose (NEW CIVIL CODE, Art. 1908).
Article 1908 does not apply to a guarantee
commission (DE LEON, supra at 534).
SPECIFIC OBLIGATIONS OF A fairly and in good faith with his agent (DE LEON,
COMMISSION AGENT
(CRIB-ND)
1. To be Responsible for the goods received by him
in the terms and conditions and as described in
the consignment, unless upon receiving them he
should make a written statement of the damage
and deterioration suffered by the same (NEW
CIVIL CODE, Art. 1903);
2. If he handles goods of the same kind and mark
belonging to different owners, to distinguish them
by Countermarks, and designate the
merchandise respectively belonging to each
principal (NEW CIVIL CODE, Art. 1904);
3. To Not sell on credit, without the express or
implied consent of the principal. Should he do so,
the principal may demand from him payment in
case, but the commission agent shall be entitled
to any interest or benefit, which may result from
such sale (NEW CIVIL CODE, Art. 1905);
4. If he is authorized to sell on credit, to Inform the
principal, with a statement of the names of the
buyers. Should he fail to do so, the sale shall be
deemed to have been made for cash insofar as
the principal is concerned (NEW CIVIL CODE,
Art. 1906);
5. To Bear the risk of collection and pay the
principal the proceeds of the sale on the same
terms agreed upon with the purchaser, if he
should receive on sale, in addition to the ordinary
commission, a guarantee commission (NEW
CIVIL CODE, Art. 1907);
6. To be liable for Damages if he does not collect
credits of his principal at the time when they
become due, unless he proves that he exercised
due diligence for that purpose (NEW CIVIL
CODE, Art. 1908).
OBLIGATIONS OF THE
PRINCIPAL
ARTS. 1910-1918
GENERAL OBLIGATIONS OF PRINCIPAL
TO AGENT
Duties and liabilities of the principal are primarily
based upon the contract and the validity of the
contract between them. In addition to his contractual
duties, the principal is under an obligation to deal
supra at 539).
SPECIFIC OBLIGATIONS OF PRINCIPAL
TO AGENT: (CARIP)
1. To Comply with all the obligations which the
agent may have contracted within the scope of
 his authority (NEW CIVIL CODE, Art. 1910) and
in the name of the principal;
2. To Advance to the agent, should the latter so
request, the sums necessary for the execution of
the agency (NEW CIVIL CODE, Art. 1912);
NOTE: Compare this with Art.1886 where the
agent is bound to advance the sums necessary
to carry out the agency, should there be a
stipulation and if the principal is solvent.
3. To Reimburse the agent for what the latter has
advanced (plus interest), even if the business
was not successful, provided the agent was free
from fault (NEW CIVIL CODE, Art. 1912);
4. To Indemnify the agent for all the damages,
which the execution of the agency may have
caused the latter without fault or negligence on
his part (NEW CIVIL CODE, Art. 1913);
5. To Pay the agent the compensation agreed upon,
or if no compensation was specified, the
reasonable value of the agent’s services (DE
LEON, supra at 540).
As for any obligation wherein the agent has exceeded
his power, the principal is not bound except when he
ratifies it expressly or tacitly (NEW CIVIL CODE, Art.
1910).
PRINCIPAL BOUND BY AGENT’S ACTS
DONE WITHIN THE SCOPE OF THE
LATTER’S AUTHORITY
GENERAL RULE: Whatever has been done or
executed by the agent within the scope of his
authority and in the name of the principal, is binding
upon the principal. Consequently, the principal must
comply with all the obligations arising from the
authorized acts of the agent (PINEDA, supra at 364).
REASON: The act of such agent is the act of the
principal (DE LEON, supra at 540-541).
Conversely, the principal is not bound by the acts of
the agent if the latter acted without or in excess of his
authority (PINEDA, supra at 364).
EXCEPTION: The principal may be bound if he
expressly or impliedly ratifies the contract (NEW
CIVIL CODE, Art. 1910).
BINDING EFFECT OF CONTRACTS
MADE WITHOUT AUTHORITY OR
OUTSIDE THE SCOPE OF AUTHORITY
GENERAL RULE: A contract entered into in the
name of another by one who has no authority or legal
representation, or who acted beyond his powers shall
be unenforceable (NEW CIVIL CODE, Art. 1317).
EXCEPTIONS:
1. When the principal ratifies such contract,
expressly or tacitly (NEW CIVIL CODE, Art.
1910);
2. When the principal has allowed the purported
agent to act as though he had full powers (NEW
CIVIL CODE, Art. 1911); and
3. When the principal has revoked the agency but
the third party has acted in good faith without
notice of the revocation (NEW CIVIL CODE, Art.
1921).
LIABILITY OF THIRD PERSONS TO
PRINCIPAL
1. Based on contract
– third person is liable to the principal upon
contracts entered into by his agent, in the same
manner as though the contract were entered into
by the principal himself (DE LEON, supra at 545).
REASON: As the nature of agency is
representative, the relationship of the third party
to the principal is the same as that in a contract
in which there is no agent (Id.).
2. In tort
– third person’s tort liability to the principal arises
in three main factual situations:
a. Where third person damages or injures
property or interest of the principal in agent’s
possession;
b. Where third person colludes with the agent to
injure or defraud the principal;
c. Where third person induces the agent to
violate his contract with the principal to
betray the trust reposed upon him by the
principal (Id. at 546).
3. In respect of property received
– in the absence of a law or the possession by
the agent of apparent authority or circumstances
of estoppel against the principal, the latter may
recover property from the agent’s transferee (Id.
at 546).
NOTE: In negotiable instrument, the law protects
third parties who are holders in due course (Id. at
547).
LIABILITY OF PRINCIPAL FOR TORT OF
AGENT RULE
The principal is civilly liable to third persons for torts
of an agent committed at the principal’s direction or
in the course and within the scope of the agent’s
employment. Whether the tort is committed willfully or
negligently has no effect on the extent or degree of
the principal’s liability (Id. at 552-553).
REASON: Based upon the principle that he who does
an act through another does it himself. The agent is
also liable with the principal and their liability is
solidary (Id.at 553).
MOTIVATION-DEVIATION TEST
The bounds of the agent’s authority are not the limits
of the principal’s tort liability, but rather the “scope of
the employment” which may or may not be within
the bounds of authority. Scope of employment is
much wider than scope of authority (Id.).
REQUISITES FOR VICARIOUS LIABILITY
FOR TORT:
1. Satisfactory evidence that the employee in doing
the act, in doing of which the tort was committed,
was motivated in part, at least, by a desire to
serve his employer; and
2. Satisfactory evidence that the act, in the doing of
which the tort is committed, was not an extreme
deviation from the normal conduct of such
employee (Id. at 554).
RATIFICATION
It is the adoption or affirmance by a person of a prior
act which did not bind him, but which was done or
professed to be done on his account, thus giving
effect to the acts as if originally authorized (Id. at
558).
NOTE: It must be stressed though that only the
principal, and not the agent, can ratify the
unauthorized acts, which the principal must have
knowledge of (Country Bankers Insurance
Corporation v. Keppel Cebu Shipyard, G.R. No.
166044, June 18, 2012).
CONDITIONS FOR RATIFICATION: (C-
BECK)
1. Principal must have Capacity and power
to ratify;
2. Act must be done in Behalf of the
principal;
NOTE: A principal cannot ratify the unauthorized
act of another person unless that person
purported to act as agent for, and in the name of
the principal, and not in his own behalf (Id. at
561).
3. Principal must ratify the acts in its
Entirety;
The acceptance of the result of the act ratifies the
whole transaction, including the means whereby
the result was achieved (DE LEON, supra at
556).
The act must be ratified in its entirety or not at all.
The principal cannot accept the benefits of a
transaction and refuse to accept the obligations.
(Id.).
4. Act must be Capable of ratification; and
5. Principal must have had Knowledge or
had reason to know of material facts
about the transaction (Id. at 549).
Thus, if material facts were suppressed or
unknown, there can be no valid ratification and
this [is] regardless of the purpose or lack thereof
in concealing such facts and regardless of the
parties between whom the question of ratification
may arise (Manila Memorial Park Cemetery, Inc.
v. Linsangan, G.R. No. 151319, November 22,
2004).
ACTS THAT MAY BE RATIFIED:
1. Valid acts;
2. Voidable acts;
3. Unrevoked acts;
The act must remain capable of ratification – the
act must be done by one party as agent for
someone else.
4. Criminal acts; and
5. Tortious acts (DE LEON, supra at 569-570).
NOTE: Acts which are absolutely void cannot be
authorized or ratified (Id. at 569).
EFFECTS OF RATIFICATION BY
PRINCIPAL
By ratification, the relation of principal and agency is
created since ratification by a principal is equivalent
to prior authority. Once made, ratification becomes
irrevocable (Id. at 572).
1. With respect to agent
– Ratification relieves the agent from liability to
the third party to the unauthorized transaction,
and to his principal for acting without authority
and he may recover the compensation due for
performing the act which has been ratified (Id. at
572).
2. With respect to the principal himself
– The principal who ratifies thereby assumes
responsibility for the unauthorized act as fully as
if the agent had acted under original authority but
is not liable for acts outside the authority
approved by his ratification. Thus, ratification
does not render the principal liable for fraudulent
 misrepresentations made by the agent without
his knowledge (Id.).
3. With respect to third persons
– Ordinarily, a third person is bound by a
ratification to the same extent as he would have
been bound if the ratified act had been authorized
in the first instance, and he cannot raise the
question of the agent’s authority to do the ratified
act (Id.).
NOTE: To be effective, ratification need not be
communicated or made known to the agent or the
third party. The act or conduct of the principal, rather
than his communication is the key. But before
ratification, the third party is free to revoke the
unauthorized contract (Id. at 573).
RETROACTIVE EFFECT OF
RATIFICATION
GENERAL RULE: The effect of ratification is the
same as where the principal allowed the agent to act
as though the latter had full authority from the
beginning (Id. at 573).
EXCEPTIONS: (DWCW)
1. Where it would Defeat the rights of third parties
which have accrued between the time of the
making of the unauthorized contract and the time
of ratification (Id. at 573).
2. If it will render Wrongful an otherwise rightful act
or omission which has taken place between the
making of the unauthorized contract and the time
of its ratification (Id. at 574).
3. If it will allow the Circumvention of a rule of law
formulated in the interest of public policy (Id. at
575).
4. If the third party has Withdrawn from the contract,
the act or transaction is no longer capable of
ratification (Id.).
SOLIDARY LIABILITY
Even when the agent has exceeded his authority, the
principal is solidarily liable with the agent if the former
allowed the latter to act as though he had full powers
(NEW CIVIL CODE, Art. 1911).
When an agent exceeds his authority in his agency,
the principal whom he is supposedly representing is
not bound thereby. The contract is considered
“unenforceable” as long as it is not ratified by the
principal (NEW CIVIL CODE, 1317, par. 2). Such
contract binds only the agent (NEW CIVIL CODE, Art.
1897; PINEDA, supra at 371).
However, a banking corporation is liable to innocent
third persons where the representation is made in the
course of its business by an agent acting within the
general scope of his authority even though, in the
particular case, the agent is secretly abusing his
authority and attempting to perpetrate a fraud upon
his principal or some other person, for his own
ultimate benefit. The bank, in its capacity as principal,
may be adjudged liable under the doctrine of
apparent authority. The principal's liability in this case
is solidary with that of his employee (Citystate
Savings Bank v Tobias, G.R. No. 227990, March 7,
2018).
DOCTRINE OF APPARENT AUTHORITY
The doctrine of apparent authority or what is
sometimes referred to as the "holding out" theory, or
the doctrine of ostensible agency, imposes
liability, not "as the result of the reality of a
contractual relationship, but rather because of the
actions of a principal or an employer in somehow
misleading the public into believing that the
relationship or the authority exists.”
It is defined as the power to affect the legal relations
of another person by transactions with third persons
arising from the other's manifestations to such third
person such that the liability of the principal for the
acts and contracts of his agent extends to those
which are within the apparent scope of the authority
conferred on him, although no actual authority to do
such acts or to make such contracts has been
conferred (Citystate Savings Bank v. Tobias, G.R.
No. 227990, March 7, 2018).
The principal’s liability, however, is limited only to
third persons who have been led reasonably to
believe by the conduct of the principal that such
actual authority exists, although none was given. In
other words, apparent authority is determined only by
the acts of the principal and not by the acts of the
agent. There can be no apparent authority of an
agent without acts or conduct on the part of the
principal; such acts or conduct must have been
known and relied upon in good faith as a result of the
exercise of reasonable prudence by a third party as
claimant, and such acts or conduct must have
produced a change of position to the third party’s
detriment (Banate v. Philippine Countryside Rural
Bank, G.R. No. 163825, July 13, 2010).
ESTOPPEL
A bar which precludes a person from denying or
asserting anything contrary to that which has been
established as the truth by his own deed or
representation either express or implied (DE LEON,
supra at 575).
 APPARENT AUTHORITY AND
AUTHORITY BY ESTOPPEL,
DISTINGUISHED
APPARENT AUTHORITY BY
AUTHORITY ESTOPPEL
As to Definition
That which though not Where the principal, by
actually granted, the his culpable negligence,
principal knowingly permits his agent to
permits the agent to exercise power not
exercise or hold him out granted to him, even
as possessing. though the principal has
no notice or knowledge
of the conduct of the
agent.
As to Basis
Founded on conscious Based on negligence of
permission of acts the principal in failing
beyond the powers properly to supervise
granted. the affairs of agent,
allowing him to exercise
powers not granted to
him, and so justifies
others in believing he
possesses the requisite
authority.
(DE LEON, supra at 579).
RATIFICATION AND ESTOPPEL,
DISTINGUISHED
RATIFICATION ESTOPPEL
As to Basis
Rests on intention, Rests on prejudice
express or implied, rather than intention.
regardless of prejudice
to another.
As to Effect
Is retroactive and Operates upon
makes the agent’s something which has
unauthorized act good been done but after the
from the beginning. misleading act and in
reliance on it and may
only extend to so much
of such act as can be
shown to be affected by
the stopping conduct.
RATIFICATION ESTOPPEL
As to Substance
Confirmation of the Principal’s inducement
unauthorized act or to another to act to his
contract after it has prejudice. Acts and
been done or made. conduct amounting to
Ratification may be an estoppel in pais may
complete without any in some instances
elements of estoppel. amount to ratification.
(Id. at 575-576).
In an agency by estoppel or apparent authority, "the
principal is bound by the acts of his agent with the
apparent authority which he knowingly permits the
agent to assume, or which he holds the agent out to
the public as possessing." The principals’
(respondents) acquiescence of the agent’s (Hojilla)
acts was made when they failed to repudiate the
latter's acts. They knowingly permitted the agent to
represent them and petitioners were clearly misled
into believing the agent’s authority. Thus, the
principals are now estopped from repudiating the
agent's authority, and the agent's actions are binding
upon the respondents (Republic of the Philippines v.
Bañez, G.R. No. 169442, October 14, 2015).
NOTE: In implied agency, there is actual agency. The
principal alone is liable. In agency by estoppel, the
authority of the agent is not real but only apparent:
1. If the estoppel is caused by the principal, he is
liable to pay third persons who relied on the
misrepresentation;
2. If it is caused by the agent, then only the agent is
liable (Id. at 581).
OBLIGATION TO ADVANCE FUNDS
The principal must advance to the agent, should the
latter so request, the sums necessary for the
execution of the agency.
Should the agent have advanced them, the principal
must reimburse him therefor, even if the business or
undertaking was not successful, provided the agent
is free from all fault.
The reimbursement shall include interest on the sums
advanced, from the day on which the advance was
made (NEW CIVIL CODE, Art. 1912).
In the absence of stipulation that the agent shall
advance the necessary funds (NEW CIVIL CODE,
Art. 1886), the principal must advance to the agent
the sums necessary for the execution of the agency
(DE LEON, supra at p. 582).
Failure of the agency, through no fault of the agent
must be borne solely by the principal. It is unfair to
hold this failure against an innocent agent (5 PARAS,
supra at 858).
Even if the agency be gratuitous, this Article still
applies; hence, the agent will still be entitled to
reimbursement and interest. This is so because the
reimbursement and interest in Article 1912 does not
refer to compensation or commission (Id.).
The right of the agent to be reimbursed is not
dependent upon the success of the undertaking or
the transaction. The reimbursement shall include
interest. In the absence of any agreement, it shall be
the legal rate at six percent (6%) (PINEDA, supra at
374-375).
OBLIGATION TO INDEMNIFY FOR
DAMAGES
The principal must also indemnify the agent for all the
damages which the execution of the agency may
have caused the latter, without fault or negligence on
his part (NEW CIVIL CODE, Art. 1913).
The liability of the principal for damages is limited only
to that which the execution of the agency has caused
the agent. Thus, no promise to indemnify will be
implied for losses or damages caused by the
independent and unexpected wrongful acts of third
persons for which the principal is in no way
responsible (DE LEON, supra at 584).
The rule is based on equity and applies even more if
the agency is gratuitous (5 PARAS supra at p. 859).
RIGHT OF LIEN
The agent may retain in pledge the things which are
the object of the agency until the principal effects the
reimbursement and pays the indemnity set forth in
the two preceding articles (NEW CIVIL CODE, Art.
1914).
Kinds
Legal pledge or pledge by operation of law (PINEDA,
supra at 377).
For the protection of the agent, the law provides that
the agent has the right to retain in pledge the objects
of the agency until the principal shall have
reimbursed him for the advances he made with
interest as well as the amount of indemnity for the
losses and damages he suffered while fulfilling the
agency (Id.).
NATURE OF AGENT’S RIGHT OF LIEN
1. The right is limited to the subject matter of the
agency (DE LEON, supra at 585).
2. The right requires possession by agent of subject
matter – To entitle the agent to a lien, the funds
or property against which it is asserted must be
in his actual or constructive possession, and he
must have acquired such possession lawfully
and in his capacity as an agent (Id.).
3. The right generally only in favor of agent – In the
absence of ratification of the sub-agent’s acts by
the principal, the right of lien exists only in favor
of the agent and cannot be claimed by one to
whom the agent delegates his authority where no
privity exists between the sub-agent and his
principal (Id. at 586).
JOINT PRINCIPALS
Two or more persons who appoint an agent for a
common transaction or undertaking (PINEDA, supra
at 378).
Nature of Liability
If two or more persons have appointed an agent for a
common transaction or undertaking, they shall be
solidarily liable to the agent for all the consequences
of the agency (NEW CIVIL CODE, Art. 1915).
Solidarity is the rule under this Article because of the
common transaction. Thus, even if the agents have
been appointed separately, the rule should apply in
the interest of justice (PINEDA, supra at 378).
NOTE: A transaction or undertaking is common to all
principals if it is one as to which their interests are in
accord and in harmony (11 Manresa 561 as cited in
DE LEON, supra at 587). The rule in Art. 1915 applies
even when the appointment was made by the
principals in separate acts, provided that they are for
the same transaction (Id. at 587).
Requisites of Solidary Liability: (2C2)
1. There are two (2) or more principals
2. The principals have all Concurred in the
appointment of the same agent; and
3. The agent is appointed for a Common transaction
or undertaking (Id. at 587).
NOTE: Any one of the principals may revoke the
agency (NEW CIVIL CODE, Art. 1925).
Illustrations:
W, X, and Y employ A as agent to sell a land owned
in common by the three, with A receiving a
commission of P1, 500,000. If A is successful, A can
collect from any of the three the sum of P1, 500,000
because of their solidary liability. Of course, if X pays
P1, 500,000, he can recover reimbursement of
P500,00 each from W and Y (5 PARAS, supra at 859-
860).
C, D, and E appoint F as their agent to sell their
separate houses. The liability of C, D, and E are
merely joint and not solidary even if the appointment
is made in one instrument. This is because this is
NOT a common transaction or undertaking (Id. at
860).
TWO PERSONS CONTRACT
SEPARATELY WITH AGENT AND
PRINCIPAL
When two persons contract with regard to the same
thing, one of them with the agent and the other with
the principal, and the two contracts are incompatible
with each other that of prior date shall be preferred,
without prejudice to the provisions of Article 1544.
(NEW CIVIL CODE, Art. 1916).
When the principal and the agent separately
contracted for the sale of the same property which is
the object of the agency, the following rules shall be
observed:
1. The contract of prior date shall prevail.
2. But, if the rule on double sale under Article 1544
is applicable, said article applies.
LIABILITY TO THIRD PERSON OF AGENT
OR PRINCIPAL WHO CONTRACTS
SEPARATELY
In the case referred to in the preceding article, if the
agent has acted in good faith, the principal shall be
liable in damages to the third person whose contract
must be rejected. If the agent acted in bad faith, he
alone shall be responsible (NEW CIVIL CODE, Art.
1917).
Whether the principal or the agent will be the one
liable for damages to the third person who has been
prejudiced under Article 1916 depends on whether
the agent acted in bad faith or not. If the agent acted
in good faith and within the scope of his authority, the
principal incurs liability. If the agent acted in bad faith,
he alone shall be responsible to such third person
(DE LEON, supra at 590).
LIABILITY OF PRINCIPAL FOR THE
EXPENSES INCURRED
GENERAL RULE: The principal is liable for the
expenses incurred by the agent in the execution of
the agency (PINEDA, supra at 381).
EXCEPTIONS: The principal is not liable for the
expenses incurred by the agent in the following
cases: (CF-KS)
1. If the agent acted in Contravention of the
principal’s instructions, unless the latter should
wish to avail himself of the benefits derived from
the contract (NEW CIVIL CODE, Art. 1918 par.
1).
REASON: To penalize the agent for disobeying
the instructions of the principal. However, if the
principal will receive the benefits derived from the
contract, there is ratification and therefore, he is
bound to pay the expenses incurred by the agent
(PINEDA, supra at 381-382).
2. When the expenses were due to the Fault of the
agent (NEW CIVIL CODE, Art. 1918 par. 2).
REASON: Fairness dictates that where the
expenses were incurred because of the fault or
negligence of the agent, he alone should bear the
expenses (PINEDA, supra at 382).
3. When the agent incurred them with Knowledge
that an unfavorable result would ensue, if the
principal was not aware thereof (NEW CIVIL
CODE, Art. 1918 par. 3).
REASON: To punish the agent. He should not
carry out the agency if the execution thereof
would manifestly result in loss or damage to the
principal (NEW CIVIL CODE, Art 1888).
However, if the principal is aware of the resulting
effect of the execution and did not stop the agent,
the agent is excused from liability (PINEDA,
supra at 382).
4. When it was Stipulated that the expenses would
be borne by the agent, or that the latter would be
allowed only a certain sum (NEW CIVIL CODE,
Art. 1918 par. 4).
REASON: The stipulation of exemption excuses
the principal from expenses. The parties are free
to enter into allowable stipulations (NEW CIVIL
CODE, Art. 1306).
LIABILITY FOR AGENT’S ILLICIT ACTS
GENERAL RULE: Where the fault or crime
committed by the agent is not in the performance of
an obligation of the principal, the latter is not bound
by the illicit act of the agent, even if it is done in
connection with his functions (5 TOLENTINO, supra
at 426).
EXCEPTIONS: (DeSC)
1. Where the delict or the quasi-delict was
committed by the agent because of Defective
instructions from the principal, or due to the lack
of necessary vigilance or supervision on his part,
the principal is liable for his own negligence;
2. When the agent Secures a contract through
fraud, or makes a fraudulent alienation, or
executes a simulated contract, all of these acts
are imputable to the principal as if done by him,
because the illicit act is inseparable from the
transaction executed for him; or
3. When the crime consists in the performance of
an act which is within the powers of the agent, but
becomes Criminal only because of the manner in
 which the agent has performed it, the principal is
liable to third persons who act in good faith (Id. at
426-427).
NOTE: Principal is still liable for mismanagement of
business by the agent (Commercial Bank & Trust Co.
v. Republic Armored Car Service Corp., G.R. No. L-
18223, June 29, 1963).
MODES OF
EXTINGUISHMENT OF
AGENCY
ARTS. 1919-1932
PRESUMPTION OF CONTINUANCE OF
AGENCY
When once shown to have existed, an agency
relation will be presumed to have continued, in the
absence of anything to show its termination (DE
LEON, supra at 592).
CONTINUANCE OF AGENCY
Parties must be:
a. Present;
b. Capacitated; and
c. Solvent (DE LEON, supra at 593).
MODES OF EXTINGUISHMENT
AGENCY: (EDWARDO)
1. Expiration of the period;
2. Death, civil interdiction, insanity or insolvency of
the principal or of the agent;
3. Withdrawal of the agent;
NOTE: Agent may withdraw by giving notice to
the principal, but must indemnify the principal for
damages that he may suffer by reason of such
withdrawal (NEW CIVIL CODE, Art. 1928).
4. Accomplishment of the object or the purpose of
the agency;
5. Revocation;
6. Dissolution of the firm or corporation, which
entrusted or accepted the agency
7. Other modes of extinguishing a simple contract
(NEW CIVIL CODE, Art. 1919).
Other Modes:
Article 1919 gives only those causes of extinction
which are peculiar to agency. The list is not exclusive
(DE LEON, supra at 592).
a. Loss and novation (NEW CIVIL CODE, Art.
1231);
b. Mutual Withdrawal from the relationship by the
principal and agent;
c. By the happening of a supervening event that
makes illegal or impossible the objective or
purpose for which the agency was constituted,
like the destruction of the subject matter which is
the object of the agency.
NOTE: Agency is terminated, as a matter of law,
upon the outbreak of war (DE LEON, supra at 598).
BASES OF THE MODES OF
EXTINGUISHMENT:
1. Revocation
Agency is an act of trust and confidence. It
ceases when the trust and confidence disappear.
Consequently, the principal is allowed to
terminate the agency when he loses his trust and
confidence is the agent. The unilateral act of
revocation of the principal is a sufficient cause
to extinguish the contract of agency (PINEDA,
supra at 383).
But the revocation must not be done in bad faith
(Id.).
Hence, if a principal acts in bad faith and with
abuse of right in terminating the agency, then he
is liable in damages (Valenzuela v. Court of
Appeals, G.R. No. 83122, October 19, 1990).
The power to revoke agency is an exception to
the general rule on mutuality of contracts in
OF Article 1308 (Id.).
2. Withdrawal of the Agent
The agent may withdraw from the agency by
giving due notice to the principal (NEW CIVIL
CODE, Art. 1928). However, although his
withdrawal is for a valid reason, he must continue
to act until the principal has had the reasonable
opportunity to take necessary steps to meet the
situation (NEW CIVIL CODE, Art. 1929).
3. Death
GENERAL RULE: Agency is extinguished ipso
jure upon the death of either principal or agent
(DE LEON, supra at 594). The death of the
principal terminates the agency, even if a period
has been stipulated and such period has not yet
ended (5 PARAS, supra at 865).
Under Article 1919, New Civil Code, agency is
extinguished by the death of the agent. His rights
and obligations arising from the contract are not
transmittable to his heirs (Sps. Terrado v. CA,
G.R. No. L-58794, August 24, 1984).
REASON: With the death of the principal, the
source of authority is extinguished; whereas if the
agent dies, he can no longer act for the benefit
and representation of the principal (DE LEON,
supra at 584).
EXCEPTIONS: (IKCDAE)
a. The agency is coupled with an Interest (NEW
CIVIL CODE, Art. 1930).
i. If the agency has been constituted in the
common interest of the principal and the
agent;
Interest in the Subject Matter
In an agency coupled with an interest,
the agent’s interest must be in the
subject matter of the power conferred
and not merely an interest in the exercise
of the power because it entitles him to
compensation. When an agent’s interest
is confined in earning his agreed
compensation, the agency is not one
coupled with an interest, since an agent’s
interest in obtaining his compensation as
such agent is an ordinary incident of the
agency relationship (Lim v. Saban, G.R.
No. 163720, December 16, 2004).
Illustration: Zenaida borrows from Jose,
and as a security, entrusts to Jose a ring,
which Jose can sell in case Zenaida fails
to pay the debt at the time of the maturity.
Even if Zenaida dies, the agency of Jose
would still remain (5 PARAS, supra at
873).
ii. If it has been constituted in the interest of
a third person who accepted the
stipulation in his favor (NEW CIVIL
CODE, Art. 1930).
Illustration: Melady sells his land to
Bravo and appoints Bravo his agent in
paying with the purchase price what
Melady owes Arellano, a third person.
Here, even when Melady dies, the
agency of Bravo continues to exist (5
PARAS, supra at 873).
b. The act of the agent was executed without
Knowledge of the death of the principal and
the third person who contracted with the
agent in good faith (NEW CIVIL CODE, Art.
1931).
NOTE: Under Act No. 3135, the power of
sale in a deed of mortgage survives the death
of the principal (mortgagor) as it is primarily
an authority conferred upon the mortgagee
for the agent’s (mortgagee) own protection.
(DE LEON, supra at 595).
The power to foreclose is not an ordinary
agency that contemplates exclusively the
representation of the principal by the agent
but is primarily an authority conferred upon
the mortgagee for the latter's own protection.
It is, in fact, an ancillary stipulation supported
by the same causa or consideration for the
mortgage and forms an essential and
inseparable part of that bilateral agreement..
(Perez v. Philippine National Bank, G.R. No.
L-21813, July 30, 1966).
The right of the mortgagee to extrajudicially
foreclose the mortgage after the death of the
mortgagor does not depend on the
authorization in the deed of mortgage
executed by the latter. The right exists
independently and is clearly recognized in
Sec. 7, Rule 86 of the Rules of Court (DE
LEON, supra at 595; Bicol Savings and Loan
Association v. Court of Appeals, G.R. No.
85302, March 31, 1989).
The agent must finish the business begun on
the death of the principal, should delay entail
any danger (NEW CIVIL CODE, Art. 1884).
c. Civil Interdiction (RPC, Art. 34), insanity and
insolvency
Civil interdiction deprives the offender during the
period of his sentence of the right to manage his
property and dispose of such property by any act
of any conveyance inter vivos. A person under
civil interdiction cannot validly give consent
(NEW CIVIL CODE, Art. 1327).
As by an act of insolvency the principal loses
control of the subject matter of the agency, the
authority of the agent to act for his principal
generally ceases by operation of law upon an
adjudication of the principal’s insolvency. The
insolvency of the agent will put an end to the
agency, if it is in any way connected with the
agent’s business, which has caused his failure
(DE LEON, supra at 594).
d. Dissolution of the firm or corporation
If the agent appointed is a corporation or a firm
(partnership) which has a juridical personality,
once it is dissolved, it could no longer function as
a principal or an agent except for winding up of
corporate affairs (CORPORATION CODE, Sec.
122; now REVISED CORPORATION CODE,
Sec. 139) or partnership affairs (NEW CIVIL
CODE, Art. 1832).
e. Accomplishment of object of purpose
At least as between the parties, principal and
agent, the fulfillment of the purpose for which the
agency is created ipso facto terminated the
agency, even though expressed to be irrevocable
(DE LEON, supra at 596). The agency becomes
functus officio. It has no more basis for its
existence (PINEDA, supra at 388).
f. Expiration of the period for which it was
constituted
Where an agency, by the terms of the original
agreement, is created for a fixed period or is to
end at a certain time, the expiration of such
period or the arrival of that time, results in the
termination of the relationship, even though the
purpose for which the agency was created has
not been accomplished. The parties may consent
to the continuation of the agency relationship
beyond the period originally fixed.
i. Time is specified – upon the arrival of the
time agreed upon.
ii. Time not specified – at the end of a
reasonable time. Either party can terminate
the relationship at will by giving notice to the
other.
iii. Period implied – the period may be implied
from the terms of the agreement, the purpose
of the agency, and the circumstances of the
parties (DE LEON, supra at 596 -597).
ACTS DONE WITHOUT KNOWLEDGE OF
PRINCIPAL’S DEATH
Anything done by the agent, without knowledge of the
death of the principal or of any other cause that
extinguishes the agency, is valid and shall be fully
effective with respect to third persons who may have
contracted with him in good faith (NEW CIVIL CODE,
Art. 1931).
EFFECT OF DEATH IN CASE OF
MULTIPLE AGENTS
1. In case of several agents constituted for
the same business or property
– death of one or more, but not all of them would
not extinguish the agency, with respect to those
who remain living.
NOTE: The same rule applies in case of civil
interdiction, insanity or insolvency of any but not
all of the common agents (VILLANUEVA, supra
at 227).
2. When it is clear at the constitution of the
agency that the common agents were
intended to be considered as having
capacity as a group and not individually
– death, legal incapacity, or insolvency of one
would legally terminate the agency (Id.).
LOSS OR DESTRUCTION OF SUBJECT
MATTER
GENERAL RULE: Agency is terminated (DE LEON,
supra at 599).
EXCEPTION (CSP):
1. Contrary agreement.
2. If it is possible to be Substituted by another.
3. Partial loss or destruction does not always
terminate the agency. It may continue in
existence as to other property not affected (Id).
CHANGE OF CONDITIONS
GENERAL RULE: Where there is a basic change in
the circumstances surrounding the transaction, which
was not contemplated by the parties and which would
reasonably lead the agent to believe that the principal
would not desire him to act, the authority of agent is
terminated (Id. at 600).
EXCEPTIONS: (R2C)
1. If the original circumstances are Restored within
a reasonable period of time.
2. Where agent has Reasonable doubts as to
whether the principal would desire him to act, his
authority will not be terminated if he acts
reasonably.
3. Where the principal and agent are in close daily
Contact, the agent’s authority to act will not
terminate upon a change of circumstances if the
agent knows the principal is aware of the change
and does not give him new instructions (Id).
REVOCATION OF AGENCY BY
PRINCIPAL
GENERAL RULE: Agency is revocable at will of the
principal, regardless of the term of the agreement, at
any time, with or without reason (NEW CIVIL CODE,
Art. 1920).
REASON:
1. The trust and confidence of the principal may
have been lost (Barreto v. Santa Marina, G.R.
No. L-8169, December 29, 1913).
2. Since the authority of the agent emanates from
the principal, it is enough if he wishes to withdraw
or terminate the agency.
3. The principal-agent relationship is consensual
and personal in nature and no one can be forced
to retain another agent against his will (DE
LEON, supra at 605).
REVOCATION AT WILL IS PROPER
1. Even if the agency is onerous;
2. Even if the period fixed has not yet expired (5
PARAS, supra at 866).
When done by the principal, it is called “revocation”
and when done by the agent, it is usually spoken of
as “withdrawal” or “renunciation” (NEW CIVIL CODE,
Art. 1919, par. 2; DE LEON, supra at 605).
EXCEPTIONS: (COMBI) (NEW CIVIL CODE, Art.
1927)
1. When the agency is Coupled with interest; (DE
LEON, supra at 619).
The interest possessed by the agent is not in the
proceeds arising from the exercise of the power,
but interest in the subject matter of the power
(Del Rosario, et al. v. Abad & Abad, G.R. No. L-
10881, September 30, 1958).
2. If it is the means of fulfilling an Obligation already
contracted;
3. If a partner is appointed Manager of a partnership
and his termination is unjustifiable;
4. If a Bilateral contract depends upon it;
Illustration: P wanted to make A his surety so P
made A his agent as a sort of inducement to
safeguard him from eventual loss (5 PARAS,
supra at 820); and
5. If it is created not only for the Interest of the
principal but also for the interest of third persons,
who have accepted the stipulation in their favor.
NOTE: Agency coupled with interest may be
revoked for a just cause (DE LEON, supra at
625).
A power of attorney can be made irrevocable by
contract only in the sense that the principal may
not recall it at his pleasure; but coupled with
interest or not, the authority certainly can be
revoked for a just cause, such as when the
attorney-in-fact betrays the interest of the
principal. It is not open to serious doubt that the
irrevocability of the power of attorney may not be
used to shield the perpetration of acts in bad
faith, breach of confidence, or betrayal of trust, by
the agent for that would amount to holding that a
power coupled with an interest authorizes the
agent to commit frauds against the principal
(Coleongco v. Claparols, G.R. No. L-18616,
March 31, 1964).
There is an exception to the principle that an
agency is revocable at will and that is when the
agency has been given not only for the interest of
the principal but for the interest of third persons
or for the mutual interest of the principal and the
agent. The principal may not defeat the agent's
right to indemnification by a termination of the
contract of agency. Where the principal
terminates or repudiates the agent's employment
in violation of the contract of employment and
without cause, the agent is entitled to receive
either the amount of net losses caused and gains
prevented by the breach, or the reasonable value
of the services rendered (Valenzuela v. Court of
Appeals, G.R. No. 83122, October 19, 1990).
LIABILITY OF PRINCIPAL FOR DAMAGE
CAUSED BY REVOCATION
While the principal may have absolute power to
revoke the agency at any time, he must respond in
damages for breach of contract where the termination
is wrongful, although Art. 1920 does not expressly
provide, in those cases wherein not having the legal
right to do so, he should discharge the agent (DE
LEON, supra at 606).
1. Fixed period
– principal shall be liable by the wrongful
discharge of the agent before expiration of the
period (Id.).
2. No fixed period
– the principal is at liberty to terminate agency at
will subject only to the requirement of good faith
(Danon v. Brimo & Co., G.R. No. 15823,
September 12, 1921).
NOTICE OF REVOCATION
1. To the agent
Express notice to the agent is not always
necessary. If the party to be notified actually
knows, or has reason to know, facts indicating
that his authority has been terminated or
suspended, there is sufficient notice (DE LEON
supra at 609).
NOTE: A revocation without notice to the agent
will not render invalid an act done in pursuance
of the authority (Id.).
2. To third persons
Actual notice must be brought home to the former
customer. While notice by publication is sufficient
to other persons (NEW CIVIL CODE, Art. 1873;
DE LEON, supra at 609).
In a case involving a general power of attorney
permitting the agent to deal with the general
public, the Supreme Court held that: Evidence
had been adduced that notice in writing had been
served not only on Choithram, but also on
 Ortigas, of the revocation of Choithram's power
of attorney by Ishwar's lawyer, on May 24, 1971.
A publication of said notice was made in the April
2, 1971 issue of The Manila Times for the
information of the general public. Such notice of
revocation in a newspaper of general
circulation is sufficient warning to third persons
including Ortigas (Ramnani v. CA, G.R. No.
85494, May 07, 1991).
NOTE: In the absence of any notice of
revocation, the principal may also be held liable
even to third persons who never dealt with the
agent previous to the revocation, if they, in
common with the public at large, are justified in
believing that such agency continues to exist (DE
LEON, supra at 609).
KINDS OF REVOCATION:
a. Express revocation; and
b. Implied revocation (DE LEON, supra at 608).
AGENCY FOR THE PURPOSE OF
CONTRACTING WITH SPECIFIED THIRD
PERSONS
If the agency has been entrusted for the purpose of
contracting with specified persons, its revocation
shall not prejudice the latter if they were not given
notice thereof (NEW CIVIL CODE, Art. 1921).
The revocation of this kind of agency shall not
prejudice specified persons who were not timely
notified of the act of revocation. They must be given
the opportunity to meet the situation so that they may
be able to protect their rights and interest (PINEDA,
supra at 391).
If the agent fails or refuses to return the power of
attorney, it is incumbent upon the principal to give
proper notice to the members of the public who may
be affected by the revocation. Under Article 1921 of
the New Civil Code, if the agency has been entrusted
for the purpose of contracting with specified persons,
its revocation shall not prejudice the latter who were
not given notice thereof (VILLANUEVA, supra at
209).
IMPLIED REVOCATION
If the agent had general powers, revocation of the
agency does not prejudice third persons who acted in
good faith and without knowledge of the revocation.
Notice of the revocation in a newspaper of general
circulation is a sufficient warning to third persons
(NEW CIVIL CODE, Art. 1922).
The appointment of a new agent for the same
business or transaction revokes the previous agency
from the day on which notice thereof was given to the
former agent, without prejudice to the provisions of
the two preceding articles (NEW CIVIL CODE,
Art.1923).
IMPLIED REVOCATION MAY BE
EFFECTED:
1. By the act of the principal in appointing
another agent for the same business or
transaction (NEW CIVIL CODE, Art. 1923);
A special power of attorney giving the son the
authority to sell the principal’s properties is
deemed revoked by a subsequent general power
of attorney that does not give such power to the
son, and any sale effected thereafter by the son
in the name of the father would be void (Dy
Buncio & Co. v. Ong Guan Can, G.R. No. L-
40681, October 2, 1934).
The revocation does not become effective as
between the principal and the agent until it is in
some way communicated to the latter (DE LEON,
supra at 614).
The rights of third persons who acted in good
faith and without knowledge of the revocation will
not be prejudiced thereby (Id. at 614).
A special power revokes a general one as to the
special matter involved in the latter (NEW CIVIL
CODE, Art.1926).
But there is no implied revocation where the
appointment of another agent is not incompatible
with the continuation of a like authority in the first
agent, or the first agent is not given notice of the
appointment of the new agent (DE LEON, supra
at 614).
NOTE: There is no proof in the record that the
first agent, the son, knew of the power-of-
attorney to his mother. It was necessary under
the law for the defendants, in order to establish
their counterclaim, to prove that the son had
notice of the second power-of-attorney (Garcia v.
De Manzano, G.R. No.13414, February 4, 1919).
2. By the act of the principal in directly
managing the business entrusted to the
agent (NEW CIVIL CODE, Art. 1924);
The agency is deemed impliedly revoked
because there is no more basis for the existence
of the agency. There is no more representation
of the principal, which is the basis of the agency.
(PINEDA, supra at 397).
But the intervention of the principal after having
appointed an agent in the very business which he
has delegated to the latter will not revoke the
 agency if there is no incompatibility (DE LEON,
supra at 615).
The rule applies only in the case of
incompatibility. In case of true inconsistency, the
agency is revoked, for there would be no longer
any basis therefor (11 Manresa 547 as cited in
DE LEON, supra at 615).
Revocation as a form of extinguishing an agency
under Article 1924 of the Civil Code only applies
in cases of incompatibility, such as when the
principal disregards or bypasses the agent in
order to deal with a third person in a way that
excludes the agent. The principals' claim for loss
cannot be seen as an implied revocation of the
agency or their way of excluding the agent
(petitioner). They did not disregard or bypass the
agent when they made an insurance claim;
rather, they had no choice but to personally do it
because of their agent's negligence. This is not
the implied termination or revocation of an
agency provided for under Article 1924 of the
Civil Code (International Exchange Bank vs.
Spouses Briones, G.R. No. 205657; March 29,
2017).
When is the agency revoked?
Although the provision does not state when the act of
revocation takes place, it can be presumed therefore
that the moment the principal directly manages the
business by dealing directly with third persons, the
agency is revoked (VILLANUEVA, supra at 201).
Logic dictates that when a principal disregards or
bypasses the agent and directly deals with such
person in an incompatible or exclusionary manner,
said third person is deemed to have knowledge of the
revocation of the agency. They are expected to know
circumstances that should have put them on guard as
to the continuing authority of that agent. The mere
fact of the principal dealing directly with the third
person, after the latter had dealt with an agent, should
be enough to excite the third person's inquiring mind
on the continuation of his authority. (Yap Bitte v.
Spouses Jonas, G.R. No. 212256, December 09,
2015).
Note: Revocation of the agency is only with respect
to the third persons with whom the principal deals
directly; as to third person who have previously
known of the power of attorney of the agent and who
have not dealt with the principal, the agency cannot
be considered revoked (Id.).
It is also apparent that unless the agent is aware or
given notice that the principal has directly managed
the business which is covered by his power of
attorney, then insofar as the agent is concerned there
is as yet no revocation of his powers (VILLANUEVA,
supra at 201).
When the agency is stipulated to be exclusive (or
when compensation is anchored on the success of
the transactions entrusted to the agent), the principal
is deprived of the authority to appoint a new agent for
the same transaction whether the new appointment
is joint with the first agent or by way of revocation
(implied) of the power of first agent (PINEDA, supra
at 396).
REVOCATION BY ONE OF THE TWO OR
MORE PRINCIPALS
When two or more principals have granted a power
of attorney for a common transaction, any one of
them may revoke the same without the consent of the
others (NEW CIVIL CODE, Art. 1925).
As the appointment of an agent by two (2) or more
principals for a common transaction or undertaking
makes them solidarily liable to the agent for all the
consequences of the agency (NEW CIVIL CODE, Art.
1915), any one of the principals is granted under this
article the right to revoke the power of attorney
without the consent of the others (DE LEON, supra at
617).
REASON: In a solidary obligation, the act of one is
the act of all (Id.).
1. By the act of the principal in subsequently
granting a special power of attorney as regards
the same business to another agent, where he
had previously granted a general power of
attorney to one agent (NEW CIVIL CODE, Art.
1926).
2. When an agent is granted a general power to do
certain acts by his principal and the latter
subsequently granted a special power to another
agent to do the same matter or transaction, the
former power is impliedly revoked. There is a
parallelism with the rule that a special law
prevails over a general law. Impliedly, a general
power subsequently granted to another agent
does not revoke the special power, unless it is
clearly stated that the special power is revoked
by the subsequent general power (PINEDA,
supra at 399).
NOTE: A special power is not revoked by a
subsequent general power of attorney given to
another agent, unless the latter refers also to the
act authorized under the special power (5
TOLENTINO, supra at 436).
REVOCATION AT WILL
GENERAL RULE ON REVOCATION: The principal
may revoke the agency at will.
EXCEPTIONS: (BFA)
1. When a Bilateral contract depends upon it;
2. If it is a means of Fulfilling an obligation already
contracted;
3. If a partner is Appointed manager or a
partnership in the contract of partnership and his
removal from the management is unjustifiable
(NEW CIVIL CODE, Art. 1927).
AGENCY COUPLED WITH AN INTEREST
An agency that is established for the mutual benefit
of the principal and of the agent, or for the interest of
the principal and of third persons, and it cannot be
revoked by the principal so long as the interest of the
agent or of a third person subsists (Lim v. Saban,
G.R. No. 163720, December 16, 2004).
WHEN A PARTNER IS APPOINTED
MANAGER OF A PARTNERSHIP AND IS
REMOVED UNJUSTIFIABLY
If a partner was agreed to be the manager of a
partnership as indicated in the Certificate of
Partnership, and for which he would devote time and
efforts and was thus induced to resign from his other
professional works so he could render full time as
manager, and has been dealing with third persons as
a representative of the firm, his appointment as
manager cannot be revoked without valid justification
(NEW CIVIL CODE, Art. 1800).
The agent may withdraw from the agency by giving
due notice to the principal. If the latter should suffer
any damage by reason of the withdrawal, the agent
must indemnify him therefore, unless the agent
should base his withdrawal upon the impossibility of
continuing the performance of the agency without
grave detriment to himself (NEW CIVIL CODE, Art.
1928).
Just as the principal may, at his will, terminate the
representation conferred by revoking the power
executed, likewise the agent may terminate the
agency by renouncing the trust (PINEDA, supra at
406).
The agent, even if he should withdraw from the
agency for a valid reason, must continue to act until
the principal has had reasonable opportunity to take
the necessary steps to meet the situation (NEW
CIVIL CODE, Art. 1929).
Even when the agent withdraws from the agency for
a valid reason, he must continue to act until the
principal has had reasonable opportunity to take the
necessary steps like the appointment of a new agent
to remedy the situation caused by the withdrawal.
The purpose of the law is to prevent damage or
prejudice to the principal (DE LEON, supra at 629).
The agency shall remain in full force and effect even
after the death of the principal, if it has been
constituted in the common interest of the latter and of
the agent, or in the interest of a third person who has
accepted the stipulation in his favor (NEW CIVIL
CODE, Art. 1930).
EFFECT OF DEATH OF THE PRINCIPAL
General Rule: Agency is terminated instantly by the
death of the principal (NEW CIVIL CODE, Art. 1919,
par. 3).
An agency is extinguished by the death of the
principal. Any act by the agent subsequent to the
principal's death is void ab initio, unless any of the
exceptions expressly recognized in Article 1930 and
Article 1931 of the Civil Code is applicable (Lopez v.
Court of Appeals, G.R. No. 163959, August 1, 2018).
Exceptions:
1. If the agency has been constituted in the
common interest of the principal and the agent
(NEW CIVIL CODE, Art. 1930);
2. If it has been constituted in the interest of a third
person who has accepted the stipulation in his
favor (NEW CIVIL CODE, Art. 1930);
3. If the agent had no knowledge of the death of the
principal or any other cause which extinguishes
the agency, and the third person who may have
contracted with him was in good faith (NEW
CIVIL CODE, Art. 1931);
4. If the agent had already begun the business and
there is an imperative need to finish the same to
avoid danger, prejudice or damage to the
principal (NEW CIVIL CODE, Art. 1884).
VALIDITY OF THE ACTS OF THE AGENT
AFTER EXTINGUISHMENT OF AGENCY
Anything done by the agent, without knowledge of the
death of the principal or of any other cause which
extinguishes the agency, is valid and shall be fully
effective with respect to third persons who may have
contracted with him in good faith (NEW CIVIL CODE,
Art. 1931).
An act done by the agent after the death of the
principal is valid and effective only under two
conditions:
1. That the agent acted without knowledge of the
death of the principal; and
2. The third person who contracted with the agent
acted in good faith (Rallos v. Go Chan & Sons,
G. R. No. L-24332, January 31, 1978).
NOTE: Both the agent and the third person must be
in good faith (PINEDA, supra at 412).

DUTY OF HEIRS TO NOTIFY UPON THE

DEATH OF AGENT
If the agent dies, his heirs have the duty to notify the
principal thereof and, in the meantime, adopt such
measures as the circumstances may demand in the
interest of the latter (NEW CIVIL CODE, Art. 1932).

NOTE: Art. 1932 does not impose on the heirs of the

principal the duty to notify the agent of the death of
the principal (DE LEON, supra at 636).

Can the heirs of the agent continue the agency?

GENERAL RULE: An agency cannot be performed
by the agent’s personal representatives in case of his
death because agency calls for personal services.

EXCEPTIONS:
1. In case of agency by operation of law or
presumed or tacit agency;
2. Where the agency is one coupled with an interest
(DE LEON, supra at 636-637).

NOTE: The Civil Code does not impose a duty on the

heirs to notify the agent of the death of the principal
(Rallos v. Go Chan & Sons, G. R. No. L-24332,
January 31, 1978).

EFFECT OF AN AGREEMENT THAT

AGENCY WILL CONTINUE AFTER
DEATH OF THE PRINCIPAL
If there is an agreement that even after the death of
the principal, the agency will still continue, the
agreement shall be void (PINEDA, supra at 416).
 CREATION OF BAILMENT
CREDIT TRANSACTIONS It may be created:
1. By contract
– in which case, it must contain all the elements
of a valid contract to be legally enforceable; or
CREDIT TRANSACTIONS
2. By operation of law (ld at 4).
Contracts of security that include all transactions
involving the purchase or loan of goods, services, or
money with a promise to pay or deliver in the future
PARTIES IN BAILMENT:
(DE LEON, Comments and Cases on Credit 1. Bailor (Comodatario)
Transactions, (2021), p. 1) [hereinafter, DE LEON]). – delivers the possession or custody of the thing
bailed; and
SECURITY
Ensures enforcement of an obligation or protects
2. Bailee (Comodante)
some interest in property (Id. at 2). – receives the custody or possession of the
thing thus delivered (Id. at 4).
TYPES OF CONTRACTS OF SECURITY:
KINDS OF CONTRACTUAL BAILMENT:
1. Secured transactions or contracts of real
1. For the sole benefit of bailee
security
a. Commodatum
– transactions supported by a collateral or an
b. Gratuitous simple loan/mutuum
encumbrance of property; and
2. For the sole benefit of bailor
2. Unsecured transactions or contracts of
a. Gratuitous deposit
personal security b. Mandatum
– transactions supported only by a promise to
pay, or commitment of another such as a
3. For the benefit of both parties (mutual-
guarantor or surety (Id. at 1).
benefit bailments)
a. bailments of mere keeping
BAILMENT b. bailments of carriage (private carriage)
It signifies a situation in which one person holds c. bailments of goods delivered to another
personal property, the ownership of which is in to work upon
another. The person who has possession is under d. bailments of goods delivered to another
the obligation to return the same goods, either in the to work with
same or in altered form to the owner, or disposes of e. bailments for security (pledges
them for his benefit, when the purpose of the f. bailments of vendor in possession after
bailment shall have been accomplished (Id. at 2). sale

4. Fortuitous Bailments
– bailments arising out of finding, salvage, theft,
etc. (Id. at 5-6).

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA R. TAMPUS, Vice
Chairperson for Secretariat | ARVY KEITH N. CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice
Chairperson for Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. TIMOTEO B. AQUINO

KINDS OF BAILMENT FOR HIRE:
1. Hire of things (locatio rei)
– where goods are delivered for the temporary
use of the hirer.
2. Hire of service (locatio operis faciendi)
– where goods are delivered for some work or
labor upon it by the bailee.
3. Hire for carriage of goods (locatio operis
mercium vehendarum)
– where goods are delivered either to a
common carrier or to a private person for the
purpose of being carried from place to place.
4. Hire of custody (location custodiae)
– where goods are delivered for storage (Id. at
7).
LOAN (ARTS. 1933–1934)
CONTRACT OF LOAN
A contract wherein one of the parties delivers to
another, either something not consumable so that
the latter may use the same for a certain time and
return it, in which case it is called commodatum; or
money, or other consumable things, upon the
condition that the same amount of the same kind and
quality shall be paid, in which case it is simply called
a loan or mutuum (CIVIL CODE, Art. 1933).
The contract of loan is governed by the rules as to
the requisites and validity of contracts in general (DE
LEON, supra at 9).
2. Loan Agreement between the credit card
holder and the credit card issuer; and
3. The promise to pay between the credit card
issuer and the merchant or business
establishment (Pantaleon v. American
Express International, Inc. G.R. No. 174269,
August 25, 2010).
The Credit Card Company has No duty to
Approve
When the Card holder use their credit cards to pay
their purchases, they merely offer to enter into loan
agreements with the credit card company. Only after
the latter approves the purchase requests that the
parties enter into binding loan contracts (Id).
KINDS OF LOAN:
1. Commodatum
– bailor delivers to the bailee a non-consumable
thing so that the latter may use it for a certain
time and return the identical thing; and
2. Simple loan (mutuum)
– lender delivers to the borrower money or other
consumable thing upon the condition that the
latter shall return the same amount of the same
kind and quality (CIVIL CODE, Art. 1933).
Consumables – are those things which cannot
be used in a manner appropriate to their nature
without their being consumed (CIVIL CODE, Art.
418).
COMMODATUM V. MUTUUM
COMMODATUM MUTUUM
As to Object

GENERAL RULE: Consumable/Fungible

MONEY MARKET TRANSACTION IS A Non-consumable/Non- (CIVIL CODE, Art. 418
LOAN fungible and Art. 1933)
A money market transaction is in the nature of a
loan. Money market has been defined to be a market EXCEPTION:
dealing in standardized short-term credit If the purpose of the
instruments where lenders and borrowers don’t deal contract is not the
directly with each other but through a middleman or consumption of the
dealer in the open market. In a money market object (e.g. for
transaction, the investor is the lender who loans his exhibition) (CIVIL
money to a borrower through a middleman or dealer CODE, Art. 1936)
(Cebu International Finance Corporation v. Court of
Appeals, G.R. No. 123031, October 12, 1999). As to Cause

Essentially gratuitous. Generally gratuitous

CREDIT CARDS although it may also be
Every Credit Card Transactions involves three onerous for there may
contracts, namely: be stipulation of
1. Contract of Sale between the cardholder interest.
and the merchant of business establishment
that accepted the card;
 COMMODATUM MUTUUM 2. Unilateral contract
– once the subject matter has been delivered, it
As to Purpose creates obligations on the part of only one of the
parties (i.e. borrower) (DE LEON, supra at 16).
Use or temporary Consumption.
possession. 3. Nominate contract
– it has been given a specific name by the Civil
Code (Id. at 16).
As to Subject Matter
4. Principal contract
Any property Personal property.
– its existence is not dependent on another
contract (Id. at 17).
NOTE: May be movable
or immovable and, if it is
movable property, it is 5. Informal contract
ordinary non- – no particular form is required for the contract
consumable (Id. at 17).

As to Ownership of the Thing 6. Gratuitous contract

– the bailee does not pay the bailor for the use
Retained by bailor. Passes to the debtor. of the thing (Id. at 17).

As to Return of the Thing LOAN V. CREDIT

Exact thing loaned. Equal amount of the LOAN CREDIT
same kind and quality.
Contract for the delivery Ability of a person to
As to Risk of Loss by one party and receipt borrow money or things
of other party of a given by virtue of the trust or
Bailor. Debtor or bailee. sum of money, or other confidence reposed by
consumable things the lender so that he will
As to Time of Return upon agreement, pay what he may
express or implied, to promise within a
In case of urgent need Upon expiration of the
repay the same amount specified period (DE
and commission of any term only.
of the same kind and LEON, supra at 10).
acts of ingratitude, even
quality, with or without
before the expiration of
interest (CIVIL CODE, The concession of
the term.
Art. 1933). “credit” necessarily
(DE LEON, supra at 13). involves the granting of
“loans” up to the limit of
CHARACTERISTICS: (RUN-PIG) the amount fixed in the
1. Real contract “credit” (ld. at 10).
– delivery of the thing loaned is necessary for
the perfection of the contract because the CREDIT IN RELATION TO DEBT
purpose of the contract is to transfer either the Credit is a sum credited on the books of a company
use or the ownership of the thing loaned (CIVIL to a person who appears to be entitled to it. It
CODE, Art. 1316). presupposes a creditor-debtor relationship, and may
be said to imply ability, by reason of property or
NOTE: An accepted promise to make a future estates, to make a promised payment (Chinatrust
loan is a consensual contract, and therefore (Phils.) Commercial Bank v. Turner, G.R. No.
binding upon the parties. However, it is only after 191458, July 3, 2017).
delivery of the subject matter will the real
contract of loan arise (CIVIL CODE, Art. 1934).
LOAN V. DISCOUNTING OF PAPER
The non-fulfillment of an accepted promise will DISCOUNTING OF
give rise to an action for damages only (5 LOAN
PAPER
TOLENTINO, Civil Code of the Philippines,
(1992), p. 443) [hereinafter 5 TOLENTINO]. As to When Interest is Deducted

Interest is taken at the Interest is deducted in

expiration of the credit. advance.
 DISCOUNTING OF
LOAN NOTE: Delivery of the thing is a condition sine
PAPER
qua non for the perfection of the contract. An
As to Expense accepted promise to deliver something, but not
yet followed by delivery, will constitute a contract
Less expensive than Slightly more expensive to loan, but it will not constitute a contract of
discounting. than obtaining loan commodatum (DE LEON, supra at 17).
because interest is
calculated on the 2. Principal
amount loaned and not – it can stand alone by itself;
on the amount actually
received. 3. Gratuitous
– the cause of which is the mere liberality of the
As to Whether it is Made on a Double/Single benefactor (CIVIL CODE, Art. 1350); and
Name Paper
4. Personal in Nature
Always on a single Always on a double
– because of the trust (5 PARAS, Civil Code of
name paper (one on name paper (one on
the Philippines Annotated (2016), p. 889)
which no other which two signatures
[hereinafter 5 PARAS].
indorsement, other than appear with both parties
the signature of the liable for payment).
maker appears. KINDS OF COMMODATUM:
1. Ordinary Commodatum
As to Repayment of Discount – use of the thing by the bailee is for a certain
period of time (CIVIL CODE, Art. 1933);
Loan must be paid The discount does not
back. have to be repaid 2. Precarium
(Herrera v. Petrophil – one whereby the bailor may demand the thing
Corp., G.R. No. L- loaned at will.
48349, December 29,
1986). A contract is precarium when:
(DE LEON, supra at 11). a. The duration and purpose of the contract are
not stipulated; or
b. The use of the thing is merely tolerated by
the owner (CIVIL CODE, Art. 1947).
COMMODATUM
OWNERSHIP OVER FRUITS
(ARTS. 1935–1952) GENERAL RULE: Bailee acquires the temporary
use of the thing but not its fruits since the bailor
remains the owner (CIVIL CODE, Art. 1935).
CONTRACT OF COMMODATUM NOTE: If the bailee is not entitled to the use of the
A contract wherein one party delivers to another thing, the contract is a deposit (CIVIL CODE, Art.
something not consumable so that the latter may use 1962).
the same for a certain time and return it (CIVIL
CODE, Art. 1933) When the bailee is obligated to maintain the property
in good condition, such contract is not a
CONTRACT AKIN TO DONATION commodatum, but is akin to one between a landlord
Both contracts of commodatum and donation confer and a tenant. (Pajuyo v. CA, G.R. No. 146364, June
benefit to the recipient. The presumption is that the 3, 2004)
bailor has loaned the thing for having no need
therefore (DE LEON, supra at 22). The cause or RATIONALE: The right to use a thing is distinct from
consideration for both is pure liberality (CIVIL CODE, the right to enjoy the fruits (DE LEON, supra at 29).
Art. 1350). The fruits pertain to the owner of the thing producing
the fruits (CIVIL CODE, Art. 441).
CHARACTERISTICS OF
EXCEPTION: When there is a stipulation to make
COMMODATUM: (RPGP) use of the fruits of the thing loaned (CIVIL CODE,
1. Real Art. 1940). Provided that the use of the fruits is
– perfected by delivery;
merely incidental; otherwise, it is usufruct (DE
LEON, supra at 28).
Such stipulation to enjoy the fruits cannot be
presumed (Id. at 29).
SUBJECT MATTER
GENERAL RULE: Non-consumable goods, whether
movable or immovable property (CIVIL CODE, Arts.
1936-1937).
EXCEPTION: Consumable goods may be the
subject matter of commodatum if the purpose of the
contract is not the consumption of the object as
when it is merely for exhibition, called commodatum
ad ostentationem (CIVIL CODE, Art. 1936).
If consumable goods are loaned only for purposes of
exhibition, or when the intention of the parties is to
lend consumable goods and to have the very same
goods returned at the end of the period agreed upon,
the loan is commodatum and not mutuum
(Producers Bank of the Phils. v. CA, G.R. No.
115324, February 19, 2003).
CAUSE OR CONSIDERATION
The cause is the liberality of the bailor.
Commodatum is essentially gratuitous (CIVIL
CODE, Art. 1933).
NOTE: If any compensation is to be paid by the
borrower, there arises a lease contract; and if the
consideration is to render some service, an
innominate contract will result (DE LEON, supra at
19).
(DE LEON, supra at 22-29).
BAILOR NEED NOT BE THE OWNER OF
THE THING LOANED (CIVIL CODE, Art. 1938)
It is sufficient that the bailor has:
1. Possessory interest; or
2. The bailor has the right to allow the use of the
thing by the bailee (e.g. lessee, usufructuary)
(DE LEON, supra at 19).
REASON: Commodatum does not contemplate
transfer of ownership.
EFFECTS OF THE PRINCIPLE THAT
COMMODATUM IS PURELY PERSONAL
(CIVIL CODE, Art. 1939)
NOTE: Art. 1939 constitutes an exception to the
general rule under Article 1178 that all rights
acquired in virtue of an obligation are transmissible
(DE LEON, supra at 27).
1. The death of either the bailor or the bailee
extinguishes the contract (CIVIL CODE, Art.
1939, Par. 1).
EXCEPTIONS:
a. When there is a contrary stipulation that the
commodatum is transmitted to the heirs of
either or both parties (CIVIL CODE, Art.
1306); and
b. If there are two or more borrowers, the death
of one does not extinguish the contract in
the absence of stipulation to the contrary
(DE LEON, supra at 28).

COMMODATUM V. 2. The bailee can neither lend nor lease the

DEPOSIT/LEASE/USUFRUCT object of the contract to a third person (CIVIL
CODE, Art. 1939(2)).
As to Purpose
EXCEPTIONS:
Principal purpose is In DEPOSIT, the principal a. Understanding or agreement to the
the gratuitous and purpose is the contrary; and
temporary use of the safekeeping of the thing. b. Members of the household may make use of
thing by the borrower. the thing loaned (DE LEON, supra at 28).
As to Consideration
Household - the immediate members of the
Essentially gratuitous In LEASE, it is always for family or the occupants of the house (R.A. No.
a price. 10361, Sec. 4(f))

As to Object of the Contract REASON: They are not considered third

persons (Id. at 28).
Bailee acquires a In USUFRUCT, the
mere use of the thing, usufructuary acquires the EXCEPTIONS TO THE EXCEPTION IN (B):
but acquires no rights right over the fruits. a. If there is a contrary stipulation; and
over the fruits thereof b. If the nature of the thing forbids such use by
in the absence of the members of the bailee’s household (Id.
stipulation to that at 28).
effect.
OBLIGATIONS OF THE BAILEE
PRINCIPAL OBLIGATIONS: (TUP-R)
1. Take care of the thing with diligence of a good
father of a family (CIVIL CODE, Art. 1163);
REASON: The bailee is supposed to return the
identical thing (CIVIL CODE, Art. 1933).
2. Use the thing loaned only for the purpose for
which it was loaned and for no other purpose
(CIVIL CODE, Arts.1935, 1939, 1940).
Otherwise, he will commit a breach of contract
(DE LEON, supra at 31).
3. Pay ordinary expenses for the use and
preservation of the thing and a portion of
extraordinary expenses arising from the actual
use of the thing (CIVIL CODE, Arts.1941, 1943,
1945, 1949, 1950);
REASON: He acquires the use of the thing, and
is supposed to return the identical thing (CIVIL
CODE, Art. 1933; DE LEON, supra at 32).
Liability for Extraordinary Expenses
If extraordinary expenses arise on the occasion
of the actual use of the thing by the bailee, even
though he acted without fault, they shall be
borne equally by both the bailor and bailee,
unless there is a stipulation to the contrary
(CIVIL CODE, Art. 1949, Par. 2);
EXCEPTION: If there is a stipulation for different
apportionment (DE LEON, supra at 44).
4. Return and not to retain the identical thing
loaned except under certain circumstances
(CIVIL CODE, Arts.1933, 1944, 1946; DE LEON,
supra at 30).
Right of Retention
GENERAL RULE: Bailee has no right to retain
the thing loaned as security on the ground that
the bailor owes him something, even though it
may be by reason of expenses (CIVIL CODE,
Art. 1944).
REASONS:
a. Ownership remains in the bailor; and
b. Only temporary use is given to the bailee
(DE LEON, supra at 36).
EXCEPTION: The bailor who, knowing the flaws
of the thing loaned, does not advise the bailee of
the same, shall be liable to the latter for the
damages which he may suffer by reason thereof
(CIVIL CODE, Art. 1951).
The bailee cannot lawfully sell the thing to satisfy
the damages (DE LEON, supra at 37).
Compensation shall not be proper when one of
the debts arises from a depositum or from the
obligations of a depositary or a bailee in
commodatum (CIVIL CODE, Art. 1287).
The mere failure of the bailee to return the
subject matter of commodatum to the bailor
does not constitute adverse possession on the
part of the bailee who holds the same in trust (Id.
at 36).
Petitioner was in possession of the disputed
property as borrower in commodatum from
private respondents since 1906 but in 1951
petitioner repudiated the trust when it declared
the property for tax purposes under its name.
The Supreme Court held that when it filed its
application for registration of the said property in
1962, petitioner had been in adverse possession
of the same for at least 10 years. Under Par. 4,
Art. 555 of the Civil Code, it is clear that the real
right of possession of bailor over the property
was lost or no longer existing after the lapse of
10 years that bailee had been in adverse
possession thereof (Catholic Vicar Apostolic of
the Mt. Province v. CA, G.R. No. 80294-95,
March 23, 1990).
OTHER OBLIGATIONS: (LDE)
1. Liability for Loss due to fortuitous event (CIVIL
CODE, Art. 1942);
GENERAL RULE: He is not liable because
ownership remains with the bailor (DE LEON,
supra at 34).
EXCEPTIONS: He is liable for loss even if it
should be through a fortuitous event in the
following cases (CIVIL CODE, Art. 1942):
(KLAS-D)
a. When he Keeps it longer than the period
stipulated, or after the accomplishment of
the use for which the commodatum has
been constituted;
REASON: Delay (CIVIL CODE, Arts. 1165,
1169, and 1170).
b. When he Lends or leases it to third persons
who are not members of his household;
REASON: Commodatum is purely personal
(CIVIL CODE, Art. 1939).
c. When the thing loaned has been delivered
with Appraisal of its value unless there is a
 stipulation exempting the bailee from
responsibility in case of fortuitous event.
REASON: The law presumes that the
parties intended that the borrower shall be
liable for the loss of the thing even if it is due
to a fortuitous event for otherwise, they
would not have appraised the thing (DE
LEON, supra at 35).
d. When, being able to Save either the thing
borrowed or his own things, he chose to
save the latter.
REASON: The bailee shows his ingratitude
after the thing is gratuitously loaned to him
(DE LEON, supra at 35).
e. When the bailee Devoted the thing for a
different use from that agreed upon.
REASON: The bailee acted in bad faith
(CIVIL CODE, Art. 1170).
2. Liability for Deterioration due to the use of the
thing (CIVIL CODE, Art. 1943);
GENERAL RULE: Bailee is not liable (DE
LEON, supra at 35).
EXCEPTIONS (SNAP):
a. If expressly Stipulated (Id. at 35);
b. If guilty of Fault or Negligence (CIVIL CODE,
Art. 1170);
c. If he devotes the thing to Any purpose
different from that for which it has been
loaned (CIVIL CODE, Art. 1942, par. 1); and
d. If he uses the thing beyond the Period
stipulated (CIVIL CODE, Art. 1942, par. 2).
3. Liability for Expenses other than those under
Arts. 1941 and 1949 of the Civil Code for the
purpose of making use of the thing (e.g. ordinary
expenses for the preservation and expenses for
ostentation) (CIVIL CODE, Art. 1950).
NOTE: In case there are two (2) or more bailees,
their obligation shall be solidary (CIVIL CODE,
Art. 1945). This is an example of a solidary
obligation by operation of law or legal solidarity
where solidarity is imposed by the law (DE
LEON, supra at 38).
REASON: To effectively safeguard the rights of
the bailor (Id. at 37).
OBLIGATIONS OF THE BAILOR: (RRL)
1. Respect the duration of the loan (CIVIL CODE,
Art. 1946).
REASON: Bailor is bound by the terms of the
contract of commodatum which is for a certain
time (DE LEON, supra at 39).
GENERAL RULE: He cannot demand return
before expiration of the period or
accomplishment of the use (CIVIL CODE, Art.
1946).
EXCEPTIONS:
a. In case of urgent need of the thing, he may
demand “its return” (meaning permanent) or
temporary use (CIVIL CODE, Art. 1946 and
5 PARAS, supra at 897); and
REASON: Commodatum is essentially
gratuitous (DE LEON, supra at 18).
Effect: If for a temporary use, the contract
of commodatum is suspended while the
thing is in the possession of the bailor (CIVIL
CODE, Art. 1946).
b. If the bailee commits any act of ingratitude
specified in Article 765 of the Civil Code:
i. Bailee should commit some offenses
against the person, honor or property of
the bailor, or of his wife or children under
his parental authority;
ii. Bailee imputes to the bailor any criminal
offense, or any act involving moral
turpitude, even though he should prove
it, unless the crime or the act has been
committed against the bailee himself,
his wife or children under his authority;
and
iii. Bailee unduly refuses the bailor support
when the bailee is legally or morally
bound to give support to the bailor
(CIVIL CODE, Art. 1948).
c. In case of precarium, the bailor can always
demand the thing loaned at will. (CIVIL
CODE, Art. 1947)
REASON: A commodatum is essentially
gratuitous (CIVIL CODE, Art. 1933).
There is no need for the existence of an act
of ingratitude (DE LEON, supra. at 43).
NOTE: If the loan is for an illegal or immoral use,
the contract is void, and the lender can
immediately recover the thing, but cannot
recover damages or non-performance of
 obligations by the borrower. (5 TOLENTINO,
supra at 448)
2. Refund to the bailee extraordinary expenses
incurred for the preservation of the thing,
provided that the bailee brings the same to the
knowledge of the bailor before incurring them,
except when the reply to the notification cannot
be awaited without danger (CIVIL CODE, Art.
1949, par. 1).
REASON: It is the bailor who profits by said
expenses (DE LEON, supra at 44).
EXCEPTION: If the extraordinary expenses
arise on the occasion of the actual use of the
thing by the bailee, even though he acted
without fault, they shall be borne equally by both
the bailor and the bailee (CIVIL CODE, Art.1949,
Par. 2).
EXCEPTION TO THE EXCEPTION: Stipulation
providing for a different apportionment of
expenses, or those expenses shall be borne by
the bailee or bailor only (DE LEON, supra at 44).
Notice is required because it is possible that the
bailor may not want to incur the extraordinary
expenses. An exception lies where they are so
urgent that the reply to the notification cannot be
awaited without danger (Id.).
If the bailee is at fault, he alone should pay.
3. Be Liable to the bailee for damages for known
hidden flaws (CIVIL CODE, Art. 1951).
Requisites: (FHANS)
a. Existence of Flaw or defect;
b. The flaw or defect is Hidden;
c. The bailor is Aware thereof;
d. Bailor does Not advise the bailee of the
same; and
e. The bailee Suffers damages by reason of
said flaw or defect (DE LEON, supra at 46).
If the above requisites concur, the bailee has the
right of retention for damages (CIVIL CODE, Art.
1944).
The bailor is made liable for his bad faith (DE
LEON, supra at 46).
If the defect is not known to the bailor, he is not
liable because commodatum is gratuitous (Id.)
No Right of Abandonment
The bailor cannot exempt himself from the
payment of expenses or damages by
abandoning the thing to the bailee (CIVIL
CODE, Art. 1952).
REASON: The expenses or damages may
exceed the value of the thing loaned, and it
would, therefore, be unfair to allow the bailor to
just abandon the thing instead of paying for said
expenses and/or damages (DE LEON, supra at
47).
NOTE: The obligations enumerated are necessary
consequences of the contract of commodatum or
arises only in certain specified instances and are not
present in all contracts of commodatum. Hence,
commodatum is a unilateral contract. (DE LEON,
supra at 21)
MUTUUM
(ARTS. 1953–1955)
CONTRACT OF MUTUUM
A bilateral contract whereby one of the parties
delivers to another money or other consumable thing
with the understanding that the same amount, of the
same kind and quality, shall be paid (CIVIL CODE,
Art. 1933).
It involves the return of the equivalent amount only
and not the identical thing because the borrower
acquires ownership of the money or other
consumable thing loaned. This obligation “to pay”
may include the accessory obligation to pay interest
(DE LEON, supra at 48).
Subject Matter: Consumable or fungible goods
FUNGIBLE AND NON-FUNGIBLE:
1. Fungible
– belongs to a common genus which includes
several species of the same kind (e.g. grain,
wine, oil) (Id. at 58).
2. Non-fungible
– specifically determined and cannot be
substituted by others (e.g. specific land,
building, particular house).
Whether a thing is consumable or not depends upon
its nature and whether it is fungible or not depends
upon the intention of the parties (Id. at 58-59).
EFFECT OF THE LOSS OF THE THING NON-PAYMENT OF LOAN V. ESTAFA
LOANED BY MISAPPROPRIATION
The loss of the thing loaned does not extinguish NON-PAYMENT OF ESTAFA BY
one’s obligation to pay (unless it is stipulated) LOAN MISAPPROPRIATION
because his obligation is not to return the thing
loaned but to pay a generic thing. Genus nunquam As to Ownership Over the Thing
perit (generic thing never perishes) (Id. at 59). Unpaid/Misappropriated

NOTE: If the borrower loses the money or the goods, No ownership. subject
this does not affect his obligation to repay the property was only held
The borrower acquires
creditor. This is in accordance with the rule of res in trust, or on
ownership over the
perit domino (Id. at 62). commission, or for
thing (CIVIL CODE, Art.
administration
1953)
Illustration: (REVISED PENAL
Borrower X placed his money loaned inside his CODE, Art. 315 (b))
cabinet. The night after, his house, together with the
money, was turned into ashes. As to Obligation Undertaken by the Debtor

X is not excused to pay the thing loaned because he To pay the creditor an
An obligation involving
is not required to return the bills with the same serial equal amount of the
the duty to deliver or
numbers, but the same amount of the loan. same kind and property
return the same (Id.)
(Id.)
BANK DEPOSITS As to Liability Incurred for Breach
Whether fixed, savings, or current deposits are in the
nature of a contract of mutuum. There is a debtor- Civil in nature. Criminal in nature.
creditor relationship between the bank and its
depositor. The bank is the debtor and the depositor
BASIS: A person who receives a loan of money or
is the creditor. The debtor lends the bank money and
any other fungible thing acquires the ownership
the bank agrees to pay the depositor on demand
thereof and is bound to pay the creditor an equal
(Consolidated Bank and Trust Corp. vs CA, G.R. No.
amount of the same kind and quality (CIVIL CODE,
138569, September 11, 2003).
Art. 1953).
CASH ADVANCES NOTE: No person shall be imprisoned for non-
A cash advance is in the nature of a simple loan payment of debt (CONST. Art. III, Sec. 20).
(mutuum), hence, no fiduciary relationship is
created.Therefore, an employee who availed of cah MUTUUM AS COMPARED TO OTHER
advances may not be held liable for estafa for failure
CONTRACTS:
to return the same money which he received (Yong
Chan Kim v People G.R. No. 84719, January 25,
1991) 1. Lease
– a contract where one of the parties binds
NO CRIMINAL LIABILITY FOR FAILURE himself to give to another the enjoyment or use
TO PAY of a thing for a price certain, and for a period
No estafa is committed by a person who refuses to which may be definite or indefinite (CIVIL CODE,
pay his debt per se as the borrower effectively Art. 1643).
acquires ownership and being the owner, he can
dispose of the thing borrowed and his act will not be
considered misappropriation thereof (DE LEON,
MUTUUM V. LEASE
supra at 55). MUTUUM LEASE

As to Definition

Delivery of money or Delivery of some non-

some consumable thing consumable thing in
with a promise to repay order that the other
an equivalent of the may use it during a
same kind and quality. certain period and
return it to the former.
 MUTUUM LEASE 3. Barter
– a contract whereby one person transfers
As to Transfer of Ownership ownership of non–fungible things to another with
the obligation on the part of the latter to give
There is a transfer of There is no transfer of things of the same kind, quality and quantity
ownership of the thing ownership of the thing (CIVIL CODE, Art. 1954).
delivered. delivered. Lessor
simply loses his COMMODATUM/MUTUUM V. BARTER
control over the
property during the COMMODATUM/
BARTER
period of the contract. MUTUUM

As to Relationship of the Parties As to Subject Matter

Relationship between Relationship is that of In mutuum, the subject Subject matter is non-
the parties is that of a landlord and tenant. matter is money or fungible, (non-
obligor-obligee. fungible things. consumable) things.

As to Receipt of Payment As to Return of the Subject Matter

Creditor receives Landlord receives In commodatum, the The thing with

payment for his loan. compensation either in bailee is bound to return equivalent value is
money, provisions, the identical thing given in return for what
chattels, or labor borrowed. has been received.
(Tolentino v.
Gonzales, G.R. No. As to Cause or Consideration
26085, August 12,
1927). Mutuum may be Always onerous, and is
gratuitous and actually a mutual sale.
(DE LEON, supra at 55-56). commodatum is
essentially gratuitous.
2. Sale
(DE LEON, supra at 64).
– a contract where one of the contracting parties
obligates himself to transfer the ownership and
FORMS OF PAYMENT:
to deliver a determinate thing, and the other to
1. If the thing loaned is money, payment must be
pay therefor a price certain in money or its
made in the currency stipulated, if it is possible
equivalent (CIVIL CODE, Art. 1458). to deliver such currency; otherwise, that which is
legal tender in the Philippines.
MUTUUM V. SALE
MUTUUM SALE In case of extraordinary inflation or deflation,
payment shall be in the value of the currency at
As to Nature the time of the creation of the obligation (CIVIL
CODE, Arts. 1249, 1250 and 1955, par. 1).
Real contract. Consensual contract.
2. If the thing loaned is a fungible other than
As to Obligations money, the borrower is under obligation to pay
the lender another thing of the same kind, quality
Generally unilateral and quantity even if it should change in value.
Bilateral and
because only the
reciprocal.
borrower has obligations. In case it is impossible to do so, the borrower
(5 PARAS, supra at 885). shall pay its value at the time of the perfection of
the loan (CIVIL CODE, Art. 1955, par. 2).
NOTE: If the property is “sold”, but the real intent is
only to give the object as security for a debt – as
when the “price” is comparatively small – there really
is a contract of loan with an “equitable mortgage”
(CIVIL CODE, Art. 1602, par. 6).

INTEREST
(ARTS. 1956–1961)
Interest may be paid either as compensation for the
use of the money (monetary interest) or as damages
(compensatory interest). The former is the interest
referred to in Article 1956 of the Civil Code; while the
latter is the interest mentioned in Article 2209 of the
Civil Code (Republic of the Phil. v. Unimex Micro-
Electronics GmBH, G.R. No. 166309-10, March 9,
2007).
There are two types of interest — monetary interest
and compensatory interest. Interest as a
compensation fixed by the parties for the use or
forbearance of money is referred to as monetary
interest, while interest that may be imposed by law
or by courts as penalty for damages is referred to as
compensatory interest (Hun Hyung Park v. Eung
Won Choi, G.R. No. 220826, March 27, 2019).
The right to interest arises only by virtue of a contract
or by virtue of damages for delay or failure to pay
principal on which interest is demanded (5 PARAS,
supra at 906; Barretto v. Santa Marina, G.R. No. L-
11908, February 4, 1918).
KINDS OF INTEREST:
1. Simple
– that which is paid for the principal at a
certain rate fixed or stipulated by the parties
. INTEREST
2. Compound
– that which is imposed upon interest due
and unpaid. The accrued interest is added
to the principal sum and the whole (principal
and accrued interest) is treated as a new
principal upon which the interest for the next
period is calculated. (DE LEON, supra at 67)
3. Legal
– that which the law directs to be charged in
the absence of any agreement as to the rate
between the parties (Id. at 68).
REQUISITES FOR DEMANDABILITY OF
INTEREST: (WEL)
1. The agreement must be in Writing (CIVIL
CODE, Art. 1956);
2. Must be Expressly stipulated (CIVIL CODE, Art.
1956);
EXCEPTIONS:
a. Indemnity for damages (CIVIL CODE, Art.
2209); and
b. Interest accruing from unpaid interest (CIVIL
CODE, Art. 2212).
3. Must be Lawful (DE LEON, supra at 69).
NOTE: The requirement that the payment of interest
must be expressly stipulated in writing applies only
to monetary interest, not to compensatory interest
(DE LEON, supra at 70).
If there is an agreement for the payment of monetary
interest but not reduced in writing, there is only a
natural obligation to pay the same (CIVIL CODE, Art.
1960).
STIPULATION OF A PARTICULAR
INTEREST RATE
If a particular rate of interest has been expressly
stipulated by the parties, that interest, not the legal
rate of interest, shall be applied (Casa Filipina
Development Corp v. Deputy Executive Secretary,
G.R. No. 96494, May 28, 1992).
If the interest rate agreed upon by the parties are
found to be unconscionable, the legal interest rate
prevailing at the time the agreement was entered
into shall be applied. The legal rate of interest, when
applied as conventional interest, shall always be the
legal rate at the time the agreement was executed
and shall not be susceptible to shifts in rate (Isla v.
Estorga, G.R. No. 233974, July 2, 2018).
LEGAL INTEREST ONLY APPLIES IN
THE ABSENCE OF STIPULATED
BSP-MB Circular No. 799 expressly states that the
legal interest applies only in the absence of
stipulated interest in loan contracts.
If the rate of interest is stipulated, such stipulated
interest shall apply and not the legal interest,
provided the stipulated interest is not excessive and
unconscionable.The stipulated interest shall be
applied until full payment of the obligation because
that is the law between the parties (Lara's Gift and
Decors, Inc. v. Midtown Industrial Sales, Inc.. G.R.
No. 225433, August 28, 2019).
Paragraph 3 in the guidelines laid down in Eastern
Shipping Lines failed to qualify that for loans or
forbearance of money, the prevailing legal interest
should only apply in the absence of stipulated
interest. This omission resulted in several rulings of
this Court, which imposed the stipulated interest on
the adjudged amount until finality of the decision
BUT applied the prevailing legal interest in lieu of the
stipulated interest from finality of the decision until
full payment of the obligation. This is in direct
contravention of the law, particularly Article 2209 of
the Civil Code, which mandates that when a debtor
incurs a delay in obligations to pay a sum of money,
the indemnity for damages shall be the payment of
the interest agreed upon (Lara's Gift and Decors,
Inc. v. Midtown Industrial Sales, Inc.. G.R. No.
225433, August 28, 2019).
The ruling in Eastern Shipping Lines (G.R. No.
97412, July 12, 1994), has now been modified by
Bangko Sentral ng Pilipinas Monetary Board
Circular No. 799, Series of 2013, which provides
that “the rate of interest for loan or forbearance of
any money, goods or credits and the rate allowed in
judgments, in the absence of an express contract as
to such rate of interest, shall be 6% per annum.” Said
circular took effect on July 1, 2013.
THE LEGAL INTEREST RATE IN
ARTICLE 2209 OF THE CIVIL CODE HAS
BEEN AMENDED
On 29 January 1973, Presidential Decree No. 116
(P.D. No. 116) was issued, which amended the
Usury Law and fixed the legal interest for loans,
forbearance of money, goods, credits or judgments
at 6% per annum "or such rate as may be
prescribed by the Monetary Board of the Central
Bank of the Philippines."
PD. No. 116 amended all laws, including Article
2209 of the Civil Code, prescribing the rate of legal
interest to allow the Bangko Sentral ng Pilipinas to
calibrate the legal interest rate to meet changing
economic conditions and to accelerate the growth of
the national economy. If RD. No. 116 did not amend
Article 2209, then all "obligations consisting in the
payment of a sum of money," which is the all-
encompassing coverage of Article 2209 applying to
all loans or forbearance of money, goods, credits or
judgments, would still be subject to the fixed 6%
legal interest rate (Lara's Gift and Decors, Inc. v.
Midtown Industrial Sales, Inc.. G.R. No. 225433,
August 28, 2019).
To summarize, the guidelines on the imposition of
interest as provided in Eastern Shipping Lines and
Nacar are further modified in the case of Lara's Gift
and Decors, Inc. v. Midtown Industrial Sales,
Inc. (G.R. No. 225433, August 28, 2019) for clarity
and uniformity, as follows:
1. When an obligation, regardless of its source,
(i.e., law, contracts, quasi-contracts, delicts or
quasi-delicts) is breached, the contravenor can
be held liable for damages and the provisions
under Title XVIII on Damages of the Civil Code
govern in determining the measure of
recoverable damages;
2. With regard to an award of interest in the
concept of actual and compensatory damages,
the rate of interest, as well as the accrual
thereof, is imposed, as follows:
i. When the obligation is breached,
and it consists in the payment of
a sum of money, i.e., a loan or
forbearance of money, goods,
credits or judgments, the interest
due shall be that which is stipulated
by the parties in writing
PROVIDED it is not excessive and
unconscionable, which, IN THE
ABSENCE OF A STIPULATED
RECKONING DATE, shall be
computed from default, i.e., from
extrajudicial or judicial demand in
accordance with Article 1169 of the
Civil Code, UNTIL FULL
PAYMENT, without compounding
any interest UNLESS compounded
interest is expressly stipulated by the
parties, by law or regulation.
ii. In the absence of stipulated
interest, the rate of interest on the
principal amount shall be the
prevailing legal interest
prescribed by the Bangko Sentral
ng Pilipinas, which shall be
computed from default (i.e., judicial
or extrajudicial demand) in
accordance with Art. 1169 of the
Civil Code UNTIL FULL PAYMENT,
without compounding any interest
UNLESS compounded interest is
expressly stipulated by law or
regulation.
iii. For breached obligations not
constituting a loan or forbearance
of money, goods, credits or
judgments, an interest on amount
of damages awarded may be
imposed at the discretion of the
court at the prevailing legal
interest prescribed by the Bangko
Sentral ng Pilipinas, pursuant to
Articles 2210 and 2011 of the Civil
Code. No interest shall be adjudged
on unliquidated claims or damages,
except when or until the demand can
be established with reasonable
certainty.
i. Where demand is
established with reasonable
certainty, the prevailing
legal interest shall begin to
run from time claim is made
judicially or extrajudicially
UNTIL FULL PAYMENT;
 ii. When certainty cannot be
reasonably established at
the time demand is made,
interest shall begin to run
only from date judgment of
the trial court is made (at
which time quantification of
damages may be deemed to
have been reasonably
ascertained) UNTIL FULL
PAYMENT. The actual base
for the computation of the
interest shall, in any case,
be on the principal amount
finally adjudged, without
compounding any interest
unless compounded interest
is expressly stipulated by
law or regulation.
iv. Whether the case falls on
forbearance or non-forbearance of
money, interest due on the principal
amount accruing as of judicial
demand shall SEPARATELY earn
legal interest at the prevailing rate
prescribed by the Bangko Sentral ng
Pilipinas, from the time of judicial
demand UNTIL FULL PAYMENT.
NOTE: The right to recover interest arises only either
by virtue of a contract (monetary interest) or as
damages for the delay or failure to pay the principal
loan on which interest is demanded (compensatory
interest). Recovery of monetary interest requires
express stipulation in writing (Odiamar v. Valencia,
G.R. No. 213582, September 12, 2018).
FORBEARANCE OF MONEY, GOODS
OR CREDIT IS DIFFERENT FROM LOAN
Forbearance of money, goods or credits" refers to
"arrangements other than loan agreements, where a
person acquiesces to the temporary use of his
money, goods or credits pending happening of
certain events or fulfillment of certain conditions
(Crismina Garments, Inc. v. Court of Appeals G.R.
No. 128721, March 9, 1999).
Forbearance of goods includes the sale of goods on
installment, requiring periodic payment of money to
the creditor. Forbearance of credits includes the sale
of anything on credit, where the full amount due can
be paid at a date after the sale (Lara's Gift and
Decors, Inc. v. Midtown Industrial Sales, Inc.. G.R.
No. 225433, August 28, 2019).
DIFFERENCE BETWEEN ARTICLE 2209
AND ARTICLE 2210-2211
Article 2209 of the Civil Code is applicable only to
loans or forbearance of money, goods or credit
which arise out of "obligations consisting in the
payment of a sum of money, and the debtor incurs
in delay," and thus where there is a debtor-creditor
relationship. Articles 2210 and 2211 refer to
obligations that do not involve the payment of a sum
of money and there is no debtor-creditor
relationship. Moreover, the payment of interest in
Article 2209 is mandatory, while the payment of
interest in Articles 2210 and 2211 is discretionary on
the court (Lara's Gift and Decors, Inc. v. Midtown
Industrial Sales, Inc.. G.R. No. 225433, August 28,
2019).
AUTHORITY OF THE BSP MONETARY
BOARD (“BSP-MB”) TO PRESCRIBE
THE MAXIMUM INTEREST RATES
In Advocates for Truth in Lending, Inc., v. Bangko
Sentral Monetary Board, G.R. No. 192986, January
15, 2013, the Supreme Court affirmed the authority
of the BSP Monetary Board (“BSP-MB”) to set
interest rates and to issue and enforce circulars
when it ruled that the BSP-MB may prescribe the
maximum rates of interest for all loans or renewals
therefor or the forbearance of any money, goods or
credits, including those for loans of low priority such
as consumer loans and loans made by pawnshops,
finance companies and similar credit institutions.
The BSP-MB is also authorized to prescribe different
maximum rates for different types of borrowings,
including deposits and deposit substitutes or loans
of financial intermediaries. This ruling was again
affirmed by the Supreme Court in Nacar v. Gallery
Frames, G.R. No. 189871, August 13, 2013.
FACTORS THAT THE MONETARY
BOARD CONSIDERS IN FIXING THE
MAXIMUM RATES OR RATES OF
INTEREST:
1. The existing economic conditions in the country
and the general requirements of the national
economy;
2. The supply of and demand for credit;
3. The rate of increase in the price levels; and
4. Such other relevant criteria as the Monetary
Board may adopt (P.D. 116, Sec. 6).
In Sps. Andal v. Philippine National Bank (G.R. No.
194201, November 27, 2013), the issue is whether
debtors shall be liable for interest on a loan after the
exorbitant stipulated interest thereon and the
subsequent foreclosure of property that secured
said loan were nullified in another case that became
final and executory. The Supreme Court ruled that
the fact that the rate of interest was subsequently
declared illegal and unconscionable does not entitle
said debtors to stop payment of interest. Only the
rate of interest was declared void, the stipulation to
pay interest remains. The debtors are considered in
default from the date of finality of the other case and
not during the time they were unable to pay the
stipulated interest as it was exorbitant and hence,
declared void.
INSTANCES WHEN INTEREST DOES
NOT BEGIN TO RUN
1. During the effectivity of the moratorium law,
which has the effect of suspending the collection
of payment of the principal obligation, which
carries the accessory obligation in the payment
of interest;
2. In case of insolvency of the bank, when the
Bangko Sentral prohibits the bank from doing
business; and
3. Despite defective consignation, from the time of
the offer and tender of payment (5 TOLENTINO,
supra at 452).
INCREASE IN INTEREST RATE
No increase in interest shall be due unless such
increase has also been expressly stipulated
(Security Bank & Trust Co. v. RTC Makati, G.R. No.
113926, October 23, 1996; Spouses Toring v.
Ganzon-Olan, G.R. No. 168782, October 10, 2008).
It was held that the unilateral determination and
imposition of increased rates is violative of the
principle of mutuality of contracts ordained in Article
1308 of the Civil Code (New Sampaguita v. PNB,
G.R. No. 148753, July 30, 2004).
LIABILITY FOR INTEREST IN THE
ABSENCE OF STIPULATION
1. Indemnity for Damages
A debtor in delay is liable to pay legal interest
(DE LEON, supra at 72).
The “obligation consisting in the payment of sum
of money” referred to in Art. 2209 of the Civil
Code is not confined to a loan or forbearance of
money but also covers cases involving default in
the payment of price or consideration under a
contract of sale, an action for damages for injury
to persons, and loss of property and an action
for damages arising from unpaid insurance
claims (Castelo v. CA, G.R. No. 96372, May 22,
1995).
Interest as indemnity for damages is payable
only in case of default or non-performance of the
contract. As they are distinct claims, they may
be demanded separately (Sentinel Insurance v.
CA, G.R. No. L-52482, February 23, 1990).
2. Interest Accruing from Unpaid Interest
Interest due shall earn interest from the time it is
judicially demanded although the obligation is
silent upon this point (CIVIL CODE, Art. 2212).
EXCEPTION
Where the court’s judgment, which did not
provide for the payment of interest has already
become final, no interest may be awarded (Ruiz
v. Caneba, G.R. No. 84884, December 3, 1990).
RULE ON ACCRUED INTEREST
GENERAL RULE: Accrued interest (interest
due and unpaid) will not bear interest (CIVIL
CODE, Art. 1959).
EXCEPTIONS:
a. If there is agreement to this effect (CIVIL
CODE, Art. 1959).
Compounding Interest
An express stipulation whereby the interest
due and unpaid shall be added to the
principal obligation and resulting total
amount shall earn interest (DE LEON, supra
at 67).
NOTE: Whatever compound interest is
agreed upon, the effective rate of interest
charged by the creditor shall not exceed
the equivalent of the maximum rate
prescribed by the Monetary Board, or, in
default thereof, whenever the debt is
judicially claimed, in which last case it shall
draw six per centum per annum interest or
such rate as may be prescribed by the
Monetary Board (Lara's Gift and Decors,
Inc. v. Midtown Industrial Sales, Inc.. G.R.
No. 225433, August 28, 2019).
b. When judicially demanded under Article
2212 of the Civil Code (DE LEON, supra at
68).
FORMULA IN COMPUTING INTEREST
FOR LOAN OR FORBEARANCE OF
MONEY:
TOTAL AMOUNT DUE = [principal + interest +
interest on interest] – partial payments made
INTEREST = principal x stipulated interest x number
of years from due date UNTIL FULL PAYMENT
INTEREST ON INTEREST = Interest computed as
of the filing of the complaint x legal interest x no. of
years until FULL PAYMENT
NOTE: Interest due on the principal amount accruing
as of judicial demand shall SEPARATELY earn legal
interest at the prevailing rate prescribed by the
Bangko Sentral ng Pilipinas, from the time of judicial
demand UNTIL FULL PAYMENT (Lara's Gift and
Decors, Inc. v. Midtown Industrial Sales, Inc., G.R.
No. 225433, August 28, 2019).
The legal interest is now 6% per annum or as may
be fixed by the Monetary Board of the Bangko
Sentral ng Pilipinas.
Illustrations:
Under a written contract of loan, B obliged himself to
pay A the sum of P20,000 at the end of the year.
If no payment of interest was mentioned, then no
interest is due.
If B incurs in delay, he is liable to pay interest at the
legal interest rate prescribed by the BSP from the
date of delay.
Suppose that A and B stipulated in their contract an
interest of 18% a year which is lawful. In this case,
all the requirements to entitle A to recover interest
are present. If B incurs in delay, he is liable to pay
the interest agreed upon as damages and not for the
use of the money.
B incurred in delay for one year. The indemnity for
damages shall also be the stipulated interest of 18%
so that B shall be liable to pay a total of P7,200:
P3,600 as compensatory interest for the first year
and another P3,600 as indemnity for the damages
for the one-year delay.
If the interest was judicially demanded six months
after B incurred in delay, the interest due (P3,600 +
P1,800 = P5,400) shall earn a legal interest of 6%
or as may be fixed by the Monetary Board of the
Bangko Sentral ng Pilipinas from the time of judicial
demand until payment is made.
DISCOUNTING
1. Interest is deducted in advance from the
proceeds of the principal obligation.
Illustrations:
The stipulated rate of interest is 15%. If the
principal amount loaned is P10,000, how much
is the interest?
Answer: P10,000 x 0.15 = P1,500
2. Instead of giving P10,000 as proceeds, only
P8,500 was given. P1,500 was deducted in
advance but the amount to be returned is
P10,000. What is the interest rate?
Answer: Divide the amount of interest by the
actual amount received by the borrower.
1,500 / 8,500 = 17.64%
Should the vendee opt to purchase a subdivision
lot via the installment payment system, he is, in
effect, paying interest on the cash price, whether
the fact and rate of such interest payment are
disclosed in the contract or not (Relucio v.
Brillante-Garfin, G.R. No. 76518, July 13, 1990).
RULE ON APPLICATION OF
PAYMENTS:
If the debt produces interest, payment of the
principal shall not be deemed to have been made
until the interests have been covered (CIVIL CODE,
Art. 1953).
While this rule is obligatory upon the debtor; the
creditor may, however, agree on the application of
payment to the principal prior to the payment of
interest.
FINANCE CHARGE
Finance charge includes interest, fees, service
charges, discounts, and such other charges incident
to the extension of credit as the Monetary Board may
prescribe. (R.A. 3765, Section 3(3))
LIABILITY FOR SURCHARGES AND
PENALTIES
The essence or rationale for the payment of interest
is separate and distinct from that of surcharges and
penalties (DE LEON, supra at 79).
A penalty stipulation is not necessarily preclusive of
interest, if there is an agreement to that effect, the
two (2) being distinct concepts which may separately
be demanded (Ligutan v. CA, G.R. No. 138677,
February 12, 2002).
USURY
Usury may be defined as contracting for or receiving
something in excess of the amount allowed by law
for the loan or forbearance of money, goods or
chattels (DE LEON, supra at 96).
Elements of Usury (FUIT):
1. Loan or Forbearance;
2. An Understanding between the parties that the
loan shall or may be returned;
3. An unlawful Intent to take more than the legal
rate for the use of money or its equivalent; and
4. The Taking or agreeing to take for the use of the
loan of something in excess of what is allowed
by law (DE LEON, supra at 96-97).
The nature of usury law is both remedial and penal
under Philippine jurisdiction (DE LEON, supra at 98).
Contracts and stipulations, under any cloak or
device whatever, intended to circumvent the laws
against usury shall be void. The borrower may
recover in accordance with the laws on usury (CIVIL
CODE, Art. 1957).
Pursuant to Central Bank Circular No. 905,
adopted on December 22, 1982, the Supreme Court
declared that the Usury Law is now "legally
inexistent". The interest chargeable depends upon
the agreement between the lender and the borrower
(Liam Law v. Olympic Sawmill Co., G.R. No. L-
30771, May 28, 1984).
However, C.B. Circular 905 did not repeal nor in
anyway amend the Usury Law but simply suspended
the latter's effectivity (Security Bank and Trust
Company v. RTC of Makati, G.R. No. 113926,
October 23, 1996).
VALIDITY OF UNCONSCIONABLE
INTEREST RATE IN A LOAN
GENERAL RULE: Interest stipulated by the
contracting parties is valid.
EXCEPTION: If the interest is iniquitous and
unconscionable (DE LEON, supra at 102).
The Supreme Court said that nothing in said circular
suspending the Usury Law grants lenders authority
to raise interest rates to levels which will either
enslave their borrowers or lead to a hemorrhaging of
their assets (Sps. Almeda v. CA, G.R. No. 113412,
April 17, 1996).
In Medel v. CA (G.R. No. 131622, November 27,
1998), it was ruled that while a stipulated interest of
5.5% per month on a loan is not usurious pursuant
to C.B. Circular 905, the same must be equitably
reduced for being iniquitous, unconscionable and
exorbitant. It is contrary to morals (contra bonos
mores). It was reduced to 12% per annum in
consonance with justice and fair play.
When the agreed rate is iniquitous and
unconscionable, the courts may reduce the same as
reason and equity demand (Imperial v. Jaucian, G.R.
No. 149004, April 14, 2004).
RECOVERY OF UNSTIPULATED
INTEREST
If paid by mistake, the debtor may recover as in the
case of solutio indebiti or undue payment (CIVIL
CODE, Art. 1960).
NOTE: If voluntarily paid, there would be no
recovery as in the case of natural obligations (CIVIL
CODE, Art. 1423).
ESCALATION CLAUSE MUST HAVE DE-
ESCALATION CLAUSE
Escalation clauses refer to stipulations allowing an
increase in the interest rate agreed upon by the
contracting parties (Juico v. China Banking Corp.,
G.R. No. 187678, April 10, 2013).
De-escalation clause is a stipulation that the rate of
interest agreed upon shall be reduced in the event
that the maximum rate of interest is reduced by law
or by the Monetary Board (PNB v. IAC, G.R. No.
75223, March 14, 1990; Villa Crista Monte Realty &
Development Corp. v. Equitable PCI Bank, G.R. No.
208336, November 21, 2018).
The presence of escalation clause without the
corresponding de-escalation clause in the event of a
reduction of interest as ordered by law makes the
clause one-sided as to make it unreasonable. Any
increase in the interest rate pursuant to an
escalation clause must be the result of an agreement
between the two parties. Increases unilaterally
imposed by a bank are in violation of the principle of
mutuality of contracts (PNB v. CA, G.R. No. 109563,
July 9, 1996; Equitable PCI Bank v. Ng Sheung
Ngor, G.R. No. 171545, December 19, 2007).
It becomes inescapable for the Court to uphold the
validity and enforceability of the escalation clause
involved herein despite the absence of the de-
escalation clause. The actual grant by the
respondent of the decreases in the interest rates
imposed on the loans extended to the petitioner
rendered inexistent the evil of inequality sought to be
thwarted by the enactment and application of
Presidential Decree No. 1684. We do not see here a
situation in which the petitioner did not stand on
equality with the lender bank (Villa Crista Monte
Realty & Development Corp. v. Equitable PCI Bank,
G.R. No. 208336, November 21, 2018).
DEPOSIT
(ARTS. 1962 – 2009)
CONTRACT OF DEPOSIT
A contract constituted from the moment a person
receives a thing belonging to another, with the
obligation of safely keeping it and of returning the
same (CIVIL CODE, Art. 1962).
PRINCIPAL PURPOSE: Safekeeping the thing and
returning the same (CIVIL CODE, Art. 1962).
If “safekeeping” is not the principal purpose it may DEPOSIT AS COMPARED TO OTHER
be: CONTRACTS
1. Commodatum;
2. Lease; or
3. Agency (DE LEON, supra at 152). DEPOSIT V. MUTUUM
DEPOSIT MUTUUM
Illustration: In the case of valet parking the contract
entered into is one of deposit; while in an ordinary As to Purpose
car parking the contract entered into is one of lease
of things (RABUYA, Pre-Bar Reviewer in Civil Law For safekeeping or Consumption.
(2021), p.524). custody.

As to Subject Matter
CHARACTERISTICS: (RUN-PIG)
1. Real contract Movable/corporeal Money or fungible
– perfected by the delivery of the subject matter things only in case of things.
(CIVIL CODE, Art. 1316). extrajudicial deposit.

An agreement to constitute a deposit is binding, Any property in case of

but the deposit itself is not perfected until the judicial deposit.
delivery of the thing (CIVIL CODE, Art. 1963).
As to Relationship
Where there has been no delivery, there is
merely an agreement to deposit, which however Depositor and Creditor and borrower
is binding and enforceable on the parties. Such depositary (DE LEON, (DE LEON, supra at
agreement is consensual (DE LEON, supra at supra at 150). 52).
154). As to Compensation
2. Unilateral Generally gratuitous, May be gratuitous, or
– when deposit is gratuitous, because only the except by mutual with a stipulation to pay
depositary has an obligation (DE LEON, supra agreement or interest (CIVIL CODE,
at 147). depositary is engaged Art. 1933, Par. 3).
in storing goods (CIVIL
NOTE: It becomes bilateral if compensation is CODE, Art. 1965).
paid because it gives rise to obligations on the
part of both the depositary and depositor (Id. at As to Time of Return
147).
Depositor can demand The lender must wait
3. Nominate the return of the subject until the expiration of
– it has been given a specific name by the Civil matter at will. the period granted to
Code (Id.). the debtor.
(DE LEON, supra at 151-153).
4. Principal
– its existence is not dependent on another DEPOSIT V. COMMODATUM
contract (Id.).
DEPOSIT COMMODATUM
5. Informal As to Purpose
– no particular form is required for the contract
(Id.). Safekeeping. Transfer of the use.

6. Gratuitous As to Time of Return

– the bailee does not pay the bailor for the use
of the thing (Id.). The depositary must, as The borrower can use the
a rule, return the thing thing for the period
deposited upon demand stipulated, and can be
(ld. at 166). required to return only in
case of urgent need or
when the bailee has
committed any of the acts
 DEPOSIT COMMODATUM freedom in choosing the depositary (DE
LEON, supra at 158).
of ingratitude under Art. b. Necessary – made:
765 of the Civil Code. i. In compliance with a legal obligation;
ii. On occasion of any calamity;
As to Subject Matter iii. By travelers in hotels and inns; or
iv. By travelers with common carriers (Id. at
Movable / corporeal Both movable and 205).
things only in case of immovable may be the
extrajudicial deposit. object. NOTE: There is a lack of free choice in the
depositor (Id. at 158).
Any property in case of
judicial deposit. JUDICIAL
As to Compensation V. EXTRA-JUDICIAL DEPOSIT
JUDICIAL EXTRA-JUDICIAL
May be gratuitous. Essentially and always
gratuitous. As to Creation
As to Parties Involved Will of the court. Will of the parties or
contract.
Depositor and depositary Bailor and bailee
As to Purpose

(DE LEON, supra at 151-152). Insures the right of a Custody and

party to property or to safekeeping of the
DEPOSIT V. SALE AND BARTER recover in case of thing deposited.
favorable judgment.
DEPOSIT SALE AND BARTER
As to Subject Matter
As to Transfer of Ownership
May cover movable as Movables only (CIVIL
Ownership is not Ownership is well as immovable CODE, Art.1966)
transferred. transferred upon property (DE LEON,
delivery. supra at 158). Reason: Object is
safekeeping. The
Reason: The purpose of possibility that the
As to Nature
the deposit is to protect thing may disappear or
Real Consensual the rights of parties to a may be lost or stolen is
suit. not present in real
property.
As to Consideration
As to Cause
Generally gratuitous Always onerous
Always onerous. Generally gratuitous.
(5 PARAS, supra at 924).
As to Time of Return
KINDS OF DEPOSIT: (CIVIL CODE,
ART.1964) Upon order of the court Upon demand of
or when litigation is depositor.
1. Judicial or Sequestration ended.
– takes place when an attachment or seizure of
property in litigation is ordered (CIVIL CODE, As to in Whose Behalf it is Held
Arts. 2005-2008)
Person who has a right. Depositor.
2. Extra-judicial (Id. at 218).
a. Voluntary – delivery is made by the will of
the depositor or by two or more persons
each of whom believes himself entitled to
the thing deposited (CIVIL CODE, Arts.
1968 to 1995). The depositor has complete
CAUSE OR CONSIDERATION
GENERAL RULE: A deposit is a gratuitous contract
(CIVIL CODE, Art.1965).
EXCEPTIONS: (SES)
1. When there is a Stipulation;
2. Depositary is Engaged in business of storing
goods; and
3. Property is Saved from destruction without
knowledge of the owner (CIVIL CODE, Art.
2169).
FORM OF DEPOSIT
A contract of deposit may be made orally or in writing
(CIVIL CODE, Art. 1969).
REASON: No written form is required because the
contract is real, and thus, the delivery itself
constitutes performance which will evidence the
perfection of the contract (DE LEON, supra at 161).
NEED NOT BE THE OWNER
The depositor need not be the owner of the thing
deposited because the purpose of the contract is
safekeeping and not transfer of ownership. The
depositary cannot demand that the depositor prove
his ownership of the thing deposited (CIVIL CODE,
Art. 1984, Par. 1). The depositary is estopped (CIVIL
CODE, Art. 1436).
DEPOSIT BY TWO OR MORE PERSONS
In case two or more persons each believe that he is
entitled to a thing deposited with a third person, the
depositary shall deliver it to the person to whom it
belongs (CIVIL CODE, Art. 1968). The remedy of the
depositary is to file an action for interpleader
(RULES OF COURT, Rule 62, Sec. 1).
WHEN DEPOSITARY DISCOVERED
THING WAS STOLEN
Should the depositary discover that the thing
deposited has been stolen and who its true owner is,
the depositary is required to advise the latter of the
deposit.
If the owner, in spite of such information, does not
claim it within ONE MONTH, the depositary shall be
relieved of all responsibility by returning the thing
deposited to the depositor (CIVIL CODE, Art. 1984,
pars. 2 and 3).
EFFECTS OF THE INCAPACITY OF THE
DEPOSITARY OR DEPOSITOR:
1. If the depositary is capacitated, he is subject
to all the obligations of a depositary whether the
depositor is capacitated or not (CIVIL CODE,
Art. 1970).
NOTE: Under the law, “persons who are
capable cannot allege the incapacity of those
with whom they contracted” (CIVIL CODE, Art.
1397).
2. If the depositary is incapacitated, he does not
incur the obligation of a depositary. However, he
is liable to:
a. Return the thing deposited while still in his
possession; or
b. Pay the depositor the amount by which he
may have benefited himself with the thing or
its price subject to the right of any third
person who acquired the thing in good faith,
in which case the depositor may only bring
an action against him for its recovery (CIVIL
CODE, Art. 1971).
NOTE: A third person is considered to have acted in
bad faith if he has actual knowledge of the incapacity
of the depositary and if he has knowledge that the
thing is subject to the contract of deposit.
OBLIGATIONS OF A DEPOSITARY
1. TO KEEP THE THING SAFELY (CIVIL
CODE, Art. 1972).
He is liable if the loss occurs through his fault or
negligence (CIVIL CODE, Art. 2207), even if the
thing is insured (CIVIL CODE, Art. 1170).
REASON: The loss of the thing while in his
possession ordinarily raises the presumption of fault
on his part (CIVIL CODE, Art. 1265).
Degree of Care
If the contract does not state the diligence which is
to be observed in the performance, that of a good
father of a family shall be required (CIVIL CODE, Art.
1972, 1173, Par 2.)
REASON:
1. It is an essential requisite of the judicial relation
which involves the depositor’s confidence in
good faith and trustworthiness.
2. Presumption that the depositor, in choosing the
depositary, took into account the diligence which
the depositary is accustomed with respect to his
own property (DE LEON, supra at 165).
EXCEPTIONS (VCB):
The required degree of care is extraordinary
diligence when:
1. It is the depositary who Voluntarily offered to
keep the thing;
2. The deposit is Compensated; or
3. The deposit produces Benefit to the depositary
(5 TOLENTINO, supra at 460).
2. TO RETURN THE THING (CIVIL CODE, Art.
1972).
Person to Whom the Thing Must Be Returned:
1. Depositor, his heirs and successors, or the
person who may have been designated in the
contract (CIVIL CODE, Art. 1972);
1. Guardian or administrator of the person who
made the deposit if the latter is incapacitated at
the time of deposit or the latter himself should he
acquire capacity (CIVIL CODE, Art. 1970);
2. Legal representative of the depositor should the
latter subsequently lose his capacity during the
deposit (CIVIL CODE, Art. 1986).
When to Return
GENERAL RULE: Upon demand even though a
specified period of time for such return may have
been fixed (CIVIL CODE, Art.1988).
REASON: The period is for the benefit of the
depositor, but it may be validly waived by him
(5 PARAS, supra at 951).
EXCEPTIONS:
1. It cannot be returned upon demand when the
thing is judicially attached while in the
depositary’s possession (CIVIL CODE, Art.
1988, par. 2);
REASON: The property will be subject to judicial
orders (5 PARAS, supra at 952).
2. The deposit cannot be returned upon demand if
the depositary has been notified of the
opposition of a third person to the return or
removal of the thing deposited (CIVIL CODE,
Art. 1988, par. 2);
REASON: The oppositor may claim to be the
owner (5 PARAS, supra at 952).
NOTE: In this case of conflicting claims, the
depositary is authorized to consign the thing in
court through an action of interpleader under
Rule 62 of the Rules of Court (DE LEON, supra
at 199)
If the deposit is gratuitous, the depositary may
return the thing deposited notwithstanding that a
period has been fixed for the deposit if justifiable
reasons exist for its return. If the depositor
refuses to receive it, the depositary may secure
its consignation from the court (CIVIL CODE, Art.
1989).
If the deposit is for a valuable consideration,
period must be followed even if the depositary
suffers inconvenience as a consequence (CIVIL
CODE, Art. 1989).
NOTE: In cases under (1) and (2), the depositary
must immediately inform the depositor of the
attachment and opposition (CIVIL CODE, Art.
1988, par. 2).
What to Return:
1. The thing deposited with all its products,
accessories, and accessions (CIVIL CODE, Art.
1983, par. 1);
2. If by force majeure or government order, the
depositary loses the thing, and receives money
or another thing in its place, he shall deliver the
sum or other thing to the depositor (CIVIL
CODE, Art. 1990).
Where to Return:
1. If there is a stipulation, at the place agreed upon
by the parties but the depositor bears the
expenses for transportation.
2. If there is no stipulation, at the place where the
thing deposited might be even if it should not be
the same place where the deposit was made
provided there was no malice on the part of the
depositary (CIVIL CODE, Art. 1987).
3. NOT TO DEPOSIT THE THING WITH A
THIRD PERSON UNLESS AUTHORIZED
BY EXPRESS STIPULATION (CIVIL CODE,
Art. 1973).
REASON: Deposit is founded on trust and
confidence (DE LEON, supra at 171).
The depositary is liable for the loss under the
following instances:
1. He transfers the deposit with a third person
without authority, although there is no
negligence on his part and the third person;
2. He deposits the thing with a third person who is
manifestly careless or unfit, although authorized,
even in the absence of negligence; and
3. The thing is lost through the negligence of his
employees whether the latter are manifestly
careless or not (CIVIL CODE, Art. 1973).
Exemption from Liability: The depositary is not
responsible in case the thing is lost without
negligence of the third person with whom he was
allowed to deposit the thing if such third person is not
“manifestly careless or unfit” (DE LEON, supra at
172).
NOTE: The depositary is responsible for the loss
through the fault of his employees under the
principle of respondeat superior (Id.).
NOTE: If the depositary urgently needs to deposit
the thing and there is no more time to obtain
consent, the depositary should be able to transfer
the deposit and should generally not be liable for the
transfer of the deposit (unless the third person is
manifestly careless or unfit) (DE LEON, supra at
172).
4. TO CHANGE THE WAY OF THE DEPOSIT
IF UNDER THE CIRCUMSTANCES, THE
DEPOSITARY MAY REASONABLY
PRESUME THAT THE DEPOSITOR
WOULD CONSENT TO THE CHANGE IF
HE KNEW OF THE FACTS OF THE
SITUATION, PROVIDED, THAT THE
FORMER NOTIFIES THE DEPOSITOR
THEREOF AND WAIT FOR HIS
DECISION, UNLESS DELAY WOULD
CAUSE DANGER (CIVIL CODE, Art. 1974).
5. IF THE THING DEPOSITED SHOULD
EARN INTEREST:
a. TO COLLECT INTEREST AND THE
CAPITAL ITSELF AS THEY FALL
DUE; AND
b. TO TAKE STEPS TO PRESERVE ITS
VALUE AND RIGHTS WITH REGARD
TO IT (CIVIL CODE, Art. 1975).
If a promissory note has been dishonored by non-
payment, the depositary must give notice of dishonor
to the indorsers so that the latter will not be
discharged from liability (DE LEON, supra at 174).
Rule on Safety deposit Boxes
A contract for the rent of safety deposit boxes is a
special kind of deposit. It is not to be strictly
governed by the provisions on deposit. It cannot also
be characterized as an ordinary contract of lease
because full and absolute control of the safety
deposit boxes was not given to the joint renters. The
relation between the bank and its customer is that of
a bailor and bailee, the bailment being for hire and
mutual benefit (CA Agro Industrial Development
Corp v. CA, G.R. No. 90027, March 3, 1993).
6. NOT TO COMMINGLE THINGS OF THE
SAME KIND AND QUALITY DEPOSITED
IF SO STIPULATED (CIVIL CODE, Art.
1976).
EXCEPTION: Depositary can only commingle if the
articles are:
1. Of the same kind and quality; and
2. There is no contrary stipulation.
If commingling is allowed, each depositor shall be
entitled to each portion of the entire mass as the
amount deposited by him bears to the whole.
If the articles deposited, belonging to different
depositors, are not of the same kind and quality, it is
the duty of the depositary to keep them separate or
at least identifiable (DE LEON, supra at 181).
7. NOT TO MAKE USE OF THE THING
DEPOSITED UNLESS AUTHORIZED
(CIVIL CODE, Art. 1977).
GENERAL RULE: Deposit is not for the use but for
the safekeeping of the subject matter. Unauthorized
use by the depositary would make him liable for
damages (DE LEON, supra at 180).
EXCEPTIONS:
1. Even without the express permission of the
depositor when the preservation of the thing
deposited requires its use; or
NOTE: It must be used only for that purpose.
2. When expressly permitted by the depositor
(CIVIL CODE, Art. 1977).
The permission to use is not presumed except when
such use is necessary for the preservation of the
thing deposited and the burden is on the depositary
to prove that permission has been given (CIVIL
CODE, Art. 1978).
Effect if Permission to Use is Given:
1. If the thing deposited is non-consumable:
The contract loses the character of a deposit and
acquires that of a commodatum.
EXCEPTION: If safekeeping is still the principal
purpose of the contract.
2. If the thing deposited is money or other
consumables:
The permission to use it will result in its
consumption and converts the contract into a
simple loan or mutuum (DE LEON, supra at 181-
182).
Prescription of Demand to Return
Things received on deposit do not prescribe, for the
depositary cannot claim that ownership of the thing
deposited was transferred to him, but simply the
custody thereof. The possession of the depositary
is not adverse to that of the depositor (Delgado v.
Bonnevie, G.R. No. 7097, October 23, 1912).
8. TO BE LIABLE FOR LOSS THROUGH
FORTUITOUS EVENT: (SUDA)
1. If Stipulated;
2. If he Uses the thing without the depositor's
permission;
3. If he Delays its return; and
4. If he Allows others to use it, even though he
himself may have been authorized to use the
same (CIVIL CODE, Art. 1979).
9. LIABILITY WHEN THE THING
DEPOSITED IS DELIVERED CLOSED
AND SEALED: (RPS)
1. To Return the thing deposited in the same
condition;
2. To Pay for damages should the seal or lock be
broken through his fault, which is presumed
unless proven otherwise; and
3. To keep the Secret of the deposit when the seal
or lock is broken with or without his fault (CIVIL
CODE, Art. 1981).
REASON: Without the rule, irresponsible
depositaries may violate their trusts with impunity
(DE LEON, supra at 193).
The depositary is authorized to open the thing
deposited, which is closed and sealed, when there
is:
1. Presumed authority, such as if the key has been
delivered to him; or
2. Necessity to do so as when the instructions of
the depositor as regards the deposit cannot be
executed without opening the box or receptacle
(CIVIL CODE, Art. 1982).
10. OBLIGATION TO RETURN PRODUCTS,
ACCESSORIES, AND ACCESSIONS
(CIVIL CODE, Art 1983).
REASON: The depositor is the owner or at least
represents the owner of the thing deposited. The
products, accessions and accessories are
consequences of ownership (DE LEON, supra at
193).
11. TO PAY INTEREST ON SUMS
CONVERTED TO PERSONAL USE FROM
THE DAY OF CONVERSION IF THE
DEPOSIT CONSISTS OF MONEY (CIVIL
CODE, Art. 1983 and 1896).
REASON: If what has been deposited is money, the
depositary has no right to make use of it. Therefore,
he is not liable to pay interest (DE LEON, supra at
194).
However, if the depositary be in delay or has used
the money without permission, he shall be liable for
interest as indemnity. The depositary owes interest
on the sums he has applied to his own use from the
day on which he did so, and those which he still owes
after the extinguishment of the deposit (Id. at 192).
NOTE: Fixed, savings, and current deposits of
money in banks and similar institutions shall be
governed by the provisions concerning simple loan
(CIVIL CODE, Art. 1980).
Bank deposits, which are in the nature of a simple
loan or mutuum, must be paid upon demand by the
depositor (Philippine National Bank v. Bacani G.R.
No. 194983, June 20, 2018).
Irregular Deposit – if safekeeping is still the
principal purpose of the contract although there is a
permission to use the consumable thing (5 PARAS,
supra at 937).
Bank deposits are in the nature of irregular deposits.
These are really loans because they earn interest.
They are governed by the law on loans (Bank of the
Philippine Islands v. CA, G.R. No. 104612, May 10,
1994).
While the bank has the obligation to return the
amount deposited, it has however, no obligation to
return or deliver the same money that was deposited
(Guingona, Jr. v. City Fiscal of Manila, G.R. No. L-
60033, April 4, 1984).
The relation between a depositor and a bank is that
of a creditor and a debtor. The depositor (creditor)
lends the bank (debtor) money and the bank agrees
to pay the depositor on demand (Central Bank of the
Philippines v. Citytrust Banking Corp., G.R. No.
141835, February 4, 2009).
A bank can compensate or set off the deposit in its
hands for the payment of any indebtedness to it on
the part of the depositor (Equitable PCI Bank v. Ng
Sheung Ngor, G.R. No. 171545, December 19,
2007). In true deposit, such compensation or set-off
is not allowed (CIVIL CODE, Art. 1287).
IRREGULAR DEPOSIT V. MUTUUM
IRREGULAR DEPOSIT MUTUUM
As to Demand by the Depositor
The consumable thing The lender cannot
deposited may be demand restitution until
demanded at will by the the time for payment,
depositor. as provided in the
contract, has arisen.
As to Accrual of Benefit
The only benefit is that Essential cause for the
 which accrues to the transaction is the OBLIGATION
DIVISIBILITY
depositor. necessity of the OF TWO OR
OF THING EFFECT
borrower. MORE
DEPOSITED
DEPOSITORS
As to Preference of Credit
be made to him
The irregular depositor Common creditors (CIVIL CODE,
has a preference over enjoy no preference in Art. 1214)
other creditors with the distribution of the
respect to the thing debtor’s property. Indivisible Solidary/not The same rule
deposited. solidary when the
obligation is
(DE LEON, supra at 183-184).
solidary,
regardless of
12. TO ADVISE THE TRUE OWNER THAT A divisibility.
DEPOSIT HAS BEEN MADE SHOULD HE
DISCOVER THAT THE THING (CIVIL CODE, Art. 1985).
DEPOSITED WAS STOLEN FROM THE
NOTE: If there is a stipulation that the thing should
OWNER (CIVIL CODE, Art. 1984).
be returned to one of the depositors, the depositary
shall return it only to the person designated (CIVIL
However, as a general rule, the depositary cannot
CODE, Art. 1985, par. 2).
demand that the depositor prove his ownership of
the thing deposited (CIVIL CODE, Art. 1984, par. 1).
DEPOSITARY’S RIGHT OF RETENTION
NOTE: If the owner, despite such information, does The depositary may retain the thing in pledge until
not claim it within the period of one (1) month, the full payment of what may be due him by reason of
depositary shall be relieved from all responsibility by the deposit (CIVIL CODE, Art. 1994). This article
returning the same to the depositor (CIVIL CODE, gives an example of pledge created by operation of
Art. 1984, par. 3). law (DE LEON, supra at 204).

If the depositary has reasonable grounds to believe RULE WHEN AN HEIR OF THE
that the thing has not been lawfully acquired by the DEPOSITOR SOLD THE THING
depositor, the former may return the same (CIVIL
DEPOSITED
CODE, Art. 1984, par. 4).
The depositor’s heir who in good faith may have sold
the thing which he did not know was deposited, shall
RULE WHEN THERE ARE TWO OR only be bound to return the price he may have
MORE DEPOSITORS received or to assign his right of action against the
OBLIGATION buyer in case the price has not been paid to him
DIVISIBILITY (CIVIL CODE, Art. 1991).
OF TWO OR
OF THING EFFECT
MORE
DEPOSITED REASON: Equity
DEPOSITORS

Divisible Not solidary Each one can If the heir acts in bad faith, he is liable for damages.
(Joint) demand only his The sale or appropriation of the thing deposited
share. constitutes estafa (DE LEON, supra at 201).

Regardless Solidary The depositary NOTE: Art. 1991 meant ‘depositary’s heir, as shown
of divisibility/ can return the in Article 1178 of the old Civil Code (5 TOLENTINO,
Indivisibility thing to any of supra at 468).
the depositors.
OBLIGATIONS OF THE DEPOSITOR
EXCEPT: When
there has been a 1. TO PAY EXPENSES FOR
demand judicial PRESERVATION IF THE DEPOSIT IS
or extrajudicial, GRATUITOUS (CIVIL CODE, Art. 1992)
for its return has (contemplates ordinary and extraordinary
been made by necessary expenses).
one of them,
payment should The law refers to necessary expenses. Useful
expenses or those for pure luxury or mere
 pleasure are not covered (DE LEON, supra at
203).
NOTE: If the deposit is for a valuable
consideration, expenses for preservation are
borne by the depositary because they are
deemed included in the compensation, unless
there is a contrary stipulation (Id. at 202).
2. TO PAY FOR LOSSES INCURRED BY
THE DEPOSITARY DUE TO THE
CHARACTER OF THE THING
DEPOSITED (CIVIL CODE, Art. 1993).
GENERAL RULE: The depositor shall
reimburse the depositary for any loss arising
from the character of the thing deposited (DE
LEON, supra at 204).
EXCEPTIONS: (AENA)
a. At the time of the deposit, the depositor was
not Aware of the dangerous character of the
thing;
b. Depositor was not Expected to know the
dangerous character of the thing;
c. Depositor Notified the depositary of the
same; and
d. The depositary was Aware of it without
advice from the depositor (CIVIL CODE,
Art.1993).
EXTINGUISHMENT OF VOLUNTARY
DEPOSIT
The causes are similar to that of the extinguishment
of obligations in Art. 1231 of the Civil Code:
(PR-RAP-MNLF)
1. Payment or Performance;
2. Remission or Condonation;
3. Rescission;
4. Annulment;
5. Prescription;
6. Merger or Confusion;
7. Novation;
8. Loss of the thing due; and
9. Fulfillment of a resolutory condition.
NOTE: Compensation as a mode of extinguishment
of obligations is not applicable to deposit (DE LEON,
supra at 206). Compensation is not proper when one
of the debts arises from a deposit or from the
obligations of a depositary or of a bailee in
commodatum (CIVIL CODE, Art. 1287).
A DEPOSIT IS ALSO EXTINGUISHED:
(LDRC)
1. Upon the Loss or destruction of the thing
deposited;
2. In case of Gratuitous deposit, upon the Death of
either the depositor or the depositary (CIVIL
CODE, Art. 1995);
REASON: Gratuitous deposits are personal in
nature (DE LEON, supra at 206).
Deposit for Compensation
A deposit for compensation is not extinguished
by the death of either party unless the deposit is
terminated by the heirs of the depositor. This is
different from the rule in gratuitous deposits
which are personal in nature (5 PARAS, supra
at 957).
3. By the Return of the thing by the depositary
(CIVIL CODE, Art. 1989);
4. By the Conversion of a deposit into another
contract if the depositor allows the depositary to
use the thing (CIVIL CODE, Art. 1978).
NOTE: The causes mentioned in Article 1995 are
NOT exclusive (DE LEON, supra at 205).
NECESSARY DEPOSIT
A deposit is necessary when:
1. Made in compliance with a legal obligation
(CIVIL CODE, Art.1996 par. 1).
Examples:
a. Judicial deposit of a thing the possession of
which is being disputed in a litigation by two
or more persons (CIVIL CODE, Art. 538);
a. Deposit with a bank or public institution of
public bonds or instruments of credit
payable to order or bearer given in usufruct
when the usufructuary does not give proper
security for their conservation (CIVIL CODE,
Art. 586);
b. Deposit of a thing pledged when the creditor
uses the same without the authority of the
owner or misuses it in any other way (CIVIL
CODE, Art. 2104);
c. Deposits required in suits as provided in the
Rules of Court; and
d. Deposits constituted to guarantee contracts
with the government. The deposit arises
from an obligation of public or administrative
character (DE LEON, supra at 208);
NOTE: A deposit made in compliance with law is
governed by the provisions of such law and, in
default thereof, by the rules on voluntary deposit
(CIVIL CODE, Art. 1997, par. 1).
2. Made on the occasion of any calamity such as
fire, storm, flood, pillage, shipwreck or other
similar event (CIVIL CODE, Art. 1996 par. 2).
This is referred to as involuntary bailment or
 involuntary deposit. Another name is deposito
miserable (DE LEON, supra at 207-208).
NOTE: There must be a causal relation between
the calamity and the constitution of the deposit
(Id. at 207).
The deposit made on any of the said calamities
shall be regulated by the provisions concerning
voluntary deposit and by Article 2168, i.e., when
during a calamity, property is saved from
destruction by another person without the
knowledge of the owner, the latter is bound to
pay the former just compensation (CIVIL CODE,
Art. 1997, Par. 2).
OTHER KINDS OF NECESSARY
DEPOSITS:
1. Deposits Made with Common Carriers:
2. Deposit by Travelers in Hotels and Inns:
The keepers of hotels or inns shall be
responsible as depositaries for the deposit of
effects made by travelers.
Elements: (No-Pre)
a. Notice was given to them or to their
employees of the effects brought by the
guests; and
b. Guests take the Precautions which said
hotel-keepers or their substitutes advised by
their relative to the care and vigilance of
their effects (CIVIL CODE, Art. 1998).
This also applies to the passenger’s baggage
which is in his personal custody (CIVIL CODE,
Art. 1754).
“Travellers” and “guests” refer to transients who
enter hotels or inns seeking lodging, and not to
boarders in dormitories and lodging houses who
select their boarders usually for a contracted
period (DE LEON, supra at 211).
Extent of liability
Not limited to baggage or articles ordinarily used
by travelers. It also extends to vehicles, animals
and articles which have been introduced or
placed in the annexes of the hotel (CIVIL CODE,
Art. 1999).
A Hotel-keeper is liable in the following
instances:
When the loss or injury is caused:
a. By his servants or employees as well as by
strangers provided that the notice has been
given and proper precautions taken; and
b. By the act of a thief or robber done without
the use of arms and irresistible force, for in
this case, the hotel-keeper is apparently
negligent (CIVIL CODE, Arts. 2000 & 2001).
A Hotel-keeper is NOT liable in the following
instances:
When the loss or injury is caused by:
a. Force majeure, theft by a stranger with the
use of arms or irresistible force (CIVIL
CODE, Art. 2000), unless he is guilty of fault
or negligence in failing to provide against the
loss or injury from his cause (DE LEON,
supra at 213-214);
b. The acts of guests, his family, servants or
visitors; and
c. The character of the things (e.g. it is
consumable) brought into the hotel (CIVIL
CODE, Art. 2002).
Rule in the occurrence of theft or robbery
The act of a thief or robber, who has entered the
hotel is not deemed force majeure, unless it is
done with the use of arms or through irresistible
force (CIVIL CODE, Art. 2001).
REASON: The innkeeper is bound to keep his
house safe from the intrusion of thieves and if
they are allowed to gain access to the house,
without the use of such force as will show its
marks upon the house, it is fairly presumable
that the innkeeper is at fault (5 PARAS, supra at
964).
Exemption or Diminution of Liability
The hotel-keeper cannot free himself from the
responsibility by posting notices to the effect that
he is not liable for the articles brought by the
guest. Any stipulation to such effect shall be void
(CIVIL CODE, Art. 2003).
REASON: Public policy. The hotel business is
imbued with public interest (YHT Realty Corp. v.
CA, G.R. No. 126780, February 17, 2005).
NOTE: It is not necessary in order to hold an
inn-keeper liable that the effects of the guests be
actually delivered to him or his employees. It is
enough that they are within the inn (De Los
Santos v. Tan Khey, 58 O.G. No. 45-53; 29 Am.
Jur. 89-90, July 30, 1962).
Right of Retention by Hotel-keepers:
The hotel-keeper has a right to retain the things
brought into the hotel by the guest, as a security
for credits on account of lodging, and supplies
usually furnished to hotel guests (CIVIL CODE,
Art. 2004).
REASON: The right is given to hotel-keepers to
compensate them for the liabilities imposed
upon them by law (DE LEON, supra at 217).
 NOTE: A safety deposit box in a hotel is a
contract of necessary deposit. The existing
relationship is one of depositor and depositary
(YHT Realty Corp. vs CA, supra.).
JUDICIAL DEPOSIT
Judicial deposit or sequestration takes place when
an attachment or seizure of property in litigation is
ordered (CIVIL CODE, Art. 2005).
Movable as well as immovable property may be the
object of sequestration (CIVIL CODE, Art. 2006).
The depositary of property or objects sequestrated
cannot be relieved of his responsibility until the
controversy which gave rise thereto has come to an
end, unless the court so orders (CIVIL CODE, Art.
2007).
The depositary of property sequestrated is bound to
comply, with respect to the same, with all the
obligations of a good father of a family (CIVIL CODE,
Art. 2008).
As to matters not provided in the Civil Code, judicial
sequestration shall be governed by the Rules of
Court (CIVIL CODE, Art. 2009).
NATURE AND PURPOSE OF JUDICIAL
DEPOSIT
The deposit is judicial because it is auxiliary to a
case pending in court.
The purpose is to maintain the status quo during the
pendency of the litigation or to insure the right of the
parties to the property in case of favorable judgment
(DE LEON, supra at 220).
CUSTODIA LEGIS
This occurs when a thing is shown to have been and
is subjected to the official custody of a judicial or
executive officer in pursuance of his execution of a
legal writ (Id. at 217).
ANTICHRESIS
ARTS. 2132-2139
CONTRACT OF ANTICHRESIS
A contract whereby the creditor acquires the right to
receive the fruits of an immovable property of the
debtor, with the obligation to apply them to the
payment of the interest, if owing, and thereafter to
the principal of his credit (CIVIL CODE, Art. 2132).
CHARACTERISTICS: (AF-NC)
1. Accessory
– it secures the performance of a principal
obligation;
2. Formal
– it must be in a specified form to be valid i.e. in
writing (CIVIL CODE, Art. 2134).
REASON: To forestall the use of antichresis for
purposes of usury (DE LEON, supra at 572).
3. Nominate
– it has been given a specific name by the Civil
Code; and
4. Consensual
– the Civil Code does not require delivery of the
immovable to the creditor (Id. at 572).
ANTICHRESIS INVOLVES AN EXPRESS
AGREEMENT BETWEEN PARTIES
WHEREBY:
1. The creditor will have possession of the
debtor’s real property given as a security;
2. Such creditor will then apply the fruits of the
said property to the interest owned by the
debtor, if any, to the principal amount;
3. The creditor retains enjoyment of such property
until the debtor has totally paid what he owes;
and
4. Should the obligation be duly paid, then the
contract is automatically extinguished
proceeding from the accessory character of the
agreement (Reyes v. Heirs of Benjamin
Malance, G.R. No 219071, August 24, 2016).
SPECIAL REQUISITES:
1. It can cover only the fruits of an immovable
property but not the immovable itself (DE LEON,
supra at 600);
NOTE: Article 1306 of the Civil Code gives parties
the freedom to stipulate otherwise. The
reduction of the amount of fruits available to the
creditor does not vary the nature of the contract
(Id.).
2. Delivery of the immovable is necessary only for
the creditor to receive the fruits and not for the
contract to be binding (Id.);
3. Amount of principal and interest must be
specified in writing, otherwise, the contract of
antichresis shall be void (CIVIL CODE, Art.
2134); and
4. Express agreement that the debtor will give Applicability of Other Articles
possession of the property to the creditor and The last paragraph of Article 2085, and Articles 2089
that the latter will apply the fruits to the interest, to 2091 of the Civil Code are applicable to this
if any, then to the principal of his credit (CIVIL contract (CIVIL CODE, Art. 2139).
CODE, Art. 2132).
An antichresis is also indivisible in nature (CIVIL
In the absence of this 4th requisite, the contract CODE, Art. 2090 & Art. 2139).
shall be deemed to be one of mortgage (Diego
v. Fernando, G.R. No. L-15128, August 25, ANTICHRESIS AS COMPARED TO
1960). REAL ESTATE MORTGAGE
Illustration: If a contract of loan with security ANTICHRESIS REAL MORTGAGE
provides for the delivery to the creditor by the
debtor of the property given as security, in order As to Delivery or Non-Delivery of the Property
that the latter may gather its fruits but without
Real Property is Debtor usually retains
stating that said fruits are to be applied to the
delivered to creditor. possession of the Real
payment of interest, if any, and afterwards that of
Property.
the principal, the contract is a mortgage and not
antichresis As to Right to the Fruits
NOTE: The obligation to pay interest is not the Creditor acquires only Creditor does not have
essence of the contract of antichresis, there the right to receive the any right to receive the
being nothing in the Code to show that fruits of the property; fruits; but the mortgage
antichresis is only applicable to securing the hence, it does not creates a real right over
payment of interest-bearing loans. On the produce a real right. the property.
contrary, antichresis is susceptible of
guaranteeing all kinds of obligations, whether However, antichresis
pure or conditional in nature (DE LEON, supra gives a real right if it is
at 569). registered in the
Registry of Property (12
MORTGAGEE IN POSSESSION Manresa 547-548).
One who has lawfully acquired actual or constructive
possession of the premises under an invalid As to the Obligation to Pay Taxes
foreclosure proceedings, standing upon his rights as
The creditor, unless The creditor has no
mortgagee and not claiming under another title for
there is stipulation to such obligation.
the purpose of enforcing his security upon such
the contrary, is obliged
property or making its income to pay his debt (Diego
to pay the taxes and
v. Fernando, G.R. No. L-15128, August 25, 1960).
charges upon the
estate.
His respective rights and obligations are similar to
the parties in a contract of antichresis, such that if As to the Obligation to Apply Fruits to the
the mortgagee acquires possession in any lawful Interest
manner he is entitled to retain such possession until
the indebtedness is satisfied and the property It is expressly stipulated There is no such
redeemed; that the non-payment of the debt within that the creditor given obligation on part of
the term agreed does not vest the ownership of the possession of the mortgagee.
property in the creditor; that the general duty of the property shall apply all
mortgagee in possession towards the premises is the fruits thereof to the
that of the ordinary prudent owner; that the payment of interest, if
mortgagee must account for the rents and profits of owing, and thereafter to
the land, any amount thus realized going towards the the principal.
discharge of the mortgage debt; that if the
mortgagee remains in the possession after the As to Subject Matter
mortgage debt has been satisfied, he becomes a
trustee for the mortgagor as to the excess of the The subject matter of both is real property.
rents and profits over such debt (Diaz v. Mendezona, (DE LEON, supra at 601-602).
et al., G.R. No. L-24824, January 30, 1926).
PROVISIONS INDICATIVE OF A v. Lichauco, G.R. Nos. L-21377 and L-21659,
CONTRACT OF MORTGAGE:
1. The agreement that the full amount of
indebtedness must be returned to the lenders
before the borrowers could demand the return of
the property, which is contrary to an antichretic
contact wherein the products of the land should
be applied to the interest and then to principal;
2. The use of the term “mortgage” in various parts
of the contract; and
3. The agreement that the lenders are not to pay
rentals on the property in consideration of the
fact that the borrowers do not pay interest on the
sum which they obtained as a loan (Id. at 603).
MEASURE OF APPLICATION OF FRUITS
TO INTEREST AND PRINCIPAL
The actual market value of the fruits at the time of
application thereof to the interest and principal shall
be the measure of such application (CIVIL CODE,
Art. 2133).
NOTE: The use of ‘actual market value’ will forestall
the use of antichresis for purposes of usury. (5
PARAS, supra at 1141).
RIGHTS OF ANTICHRETIC CREDITOR:
(FPS-R2)
1. The right to the Fruits and income of the thing
(CIVIL CODE, Art. 2132);
2. Preference to the proceeds of the sale of the
thing (5 TOLENTINO, supra at 567);
3. To have the thing Sold upon non-payment at
maturity (CIVIL CODE, Art. 2137, Par. 2);
NOTE: In this case, the Rules of Court on the
foreclosure of mortgages shall apply.
4. To Retain the thing until the debt is paid (CIVIL
CODE, Art. 2136, Par. 1); and
NOTE: The property delivered stands as a
security for the payment of the obligation of the
debtor in antichresis. (Macapinlac v. Repide,
G.R. No. 18574, September 20, 1922).
The antichretic debtor’s complaint for recovery
of possession of the real property given as
security must be dismissed if debt has not been
totally paid (Sps. Reyes v. Heirs of Malance,
G.R. No. 219071, August 24, 2016).
5. To be Reimbursed for his expense for
machinery and other improvements on the land,
and for the sums paid as land taxes (Magdañgal
October 8, 1924).
OBLIGATIONS OF ANTICHRETIC
CREDITOR: (TABA)
1. To pay Taxes and charges on the estate, if there
has been no stipulation to the contrary, and to
bear the expenses necessary for preservation
and repair. The sums spent shall be deducted
from the fruits (CIVIL CODE, Art. 2135).
NOTE: The creditor has to pay for the taxes and
charges, even if the fruits be insufficient (5
PARAS, supra at 1145).
If he does not pay the taxes, he is, by law,
required to pay indemnity for damages to the
debtor (Pando v. Gimenez, G.R. No. 31816,
February 15, 1930).
Creditor may avoid said obligation by compelling
debtor to reacquire enjoyment of the property,
unless there is a stipulation to the contrary
(CIVIL CODE, Art. 2136, par. 2).
If the debtor has paid for the taxes, which the
creditor should have paid, the amount is to be
applied to the payment of the debt, and the
debtor is entitled to the return of the property free
from all encumbrances if he, in effect, by
advancing the taxes, had already discharged the
debt (Rosales v. Tanseco, G.R. No. L-4135,
November 29, 1951).
2. To Apply all the fruits, after receiving them, to
the payment of interest, if owing, and thereafter
to the principal in accordance with the provisions
of Article 2133 or 2138 of the Civil Code (CIVIL
CODE, Art. 2132)
3. To Bear the necessary expenses for its
preservation and repair (CIVIL CODE, Art.
2135);
4. To render an Account of the fruits to the debtor
(Nadal v. CA, G.R. No. L-46623, March 4, 1994).
REMEDIES OF CREDITOR IN CASE OF
DEFAULT
If the debt is not paid, the creditor does not acquire
ownership of the real estate, since what was
transferred is not the ownership, but merely the right
to receive fruits (CIVIL CODE, Art. 2137; DE LEON,
supra at 574).
The remedies of the antichretic creditor are:
1. Action for specific performance; and
2. Petition for the sale of the real property as in a
foreclosure of mortgages under Rule 68 of the
Rules of Court (CIVIL CODE, Art. 2137).
 NOTE: The parties may agree on an
extrajudicial foreclosure in the same manner as
they are allowed in contracts of mortgage and
pledge (Tavera v. El Hogar Filipino, Inc., G.R.
No. 45963, October 12, 1939).
PROHIBITION AGAINST PACTUM
COMMISSORIUM
A stipulation authorizing the antichretic creditor to
appropriate the property, upon the non-payment of
the debt, within the agreed period is void (CIVIL
CODE, Art. 2088).
ACQUISITION BY PRESCRIPTION
GENERAL RULE: The creditor in antichresis and
his successors-in-interest cannot ordinarily acquire
the property subject of the antichresis by prescription
(Cotoner-Zacarias v. Sps. Revilla, G.R. No. 190901,
November 12, 2014).
EXCEPTION: He repudiates his status as an
antichretic creditor before he can claim ownership
(DE LEON, supra at 574).
Possession of the antichretic creditor is not in the
concept of an owner, which is required for the
purpose of acquisitive prescription. He is a mere
holder placed in the possession of the land by the
debtor-owner (Cotoner-Zacarias v. Sps. Revilla,
G.R. No. 190901, November 12, 2014).
QUASI-CONTRACTS
ARTS. 2142-2176
QUASI-CONTRACT
It is a juridical relation resulting from a lawful,
voluntary, and unilateral act, and which has for its
purpose the payment of indemnity to the end that no
one shall be unjustly enriched or benefited at the
expense of another (CIVIL CODE, Art. 2142).
BASES FOR QUASI-CONTRACTS:
1. No one must unjustly enrich himself at the
expense of another;
NOTE: Two (2) conditions must generally
concur before the rule on unjust enrichment can
apply:
a. A person is unjustly benefited; and
b. Such benefit is derived at another’s expense
or damage (MC Engineering, Inc., v. CA,
G.R. No. 104047, April 3, 2002).
2. If one benefits, he must reimburse; and
3. Justice and equity (5 PARAS, supra at 1157).
TWO PRINCIPAL KINDS:
1. Negotiorum gestio (unauthorized
management); and
2. Solutio indebiti (undue payment).
NOTE: The provisions for quasi-contracts do not
exclude other quasi-contracts which may come
within the purview of Article 2142 of the Civil Code
(CIVIL CODE, Art. 2143).
NEGOTIORUM GESTIO
It arises when a person, without the express or
implied authority of, or opposition from, the owner of
a business or property which is neglected or
abandoned, takes charge of the agency or
management thereof (CIVIL CODE, Art. 2144).
The ratification of the management by the owner of
the business produces the effects of an express
agency, even if the business may not have been
successful (CIVIL CODE, Art. 2149).
Requisites of Negotiorum Gestio
1. No meeting of the minds;
2. Taking charge of another’s business or property;
3. The property or business must have been
abandoned or neglected (otherwise, the rule on
unauthorized contracts would apply);
4. The officious manager must not have been
expressly or implicitly authorized (otherwise, the
rule on agency would apply); and
5. The officious manager (gestor) must have
voluntarily taken charge (that is, there must be
no vitiation of consent, such as error in thinking
that he owned the property or the business) (5
PARAS, supra at 1159)
NEGOTIORUM GESTIO
V. IMPLIED AGENCY
NEGOTIORUM IMPLIED AGENCY
GESTIO
As to Necessity of Authorization
Gestor should never The agent is actually
have been authorized in authorized to assume
any manner. the agency by virtue of
the acts of the owner or
by virtue of his silence,
inaction, or his failure to
repudiate the agency.

NEGOTIORUM IMPLIED AGENCY
GESTIO
As to Necessity of Neglect or Abandonment
Business or property Neglect or
should be neglected or abandonment is not
abandoned. necessary.
(5 PARAS, supra at 1159).
NOTE: So long as the owner does not know that
another is acting on his behalf without authority,
negotiorum gestio exists, but once he becomes
aware of such fact and still he does not repudiate the
acts of the agent, the quasi-contract ceases to exist.
It has become an implied agency (5 PARAS, supra
at 1159).
Officious Manager/Meddler
A party who, in the absence of any contract
whatsoever, officiously undertakes to do a service
with respect to the property of another (5
TOLENTINO, supra at 578)
Responsibilities of the Officious Manager:
1. Continue taking charge of the agency or
management until the termination of the affairs
and its incidents, but he may require the owner,
if the latter is in a position to do so, to substitute
the officious manager (CIVIL CODE, Art. 2144);
2. Perform his duties with all the diligence of a good
father of a family, and pay the damages which
through his fault or negligence may be suffered
by the owner of the property or business under
management, but the courts may however,
increase or moderate the indemnity according to
the circumstances of each case (CIVIL CODE,
Art. 2145);
NOTE: A gestor is liable for the acts or
negligence of his employees (5 PARAS, supra
at 1160).
3. Be liable for the acts of his delegate if he
delegated to another person all or some of his
duties, without prejudice to the direct obligation
of the delegate toward the owner of the business
(CIVIL CODE, Art. 2146, par. 1);
4. Be personally liable for contracts which he has
entered into with third persons, even though he
acted in the name of the owner, and there shall
be no right of action between the owner and third
persons except:
a. When the owner has expressly or tacitly
ratified the management, or
b. When the contract refers to things pertaining
to the owner of the business (CIVIL CODE,
Art. 2152).
NOTE: The responsibility of two or more
officious managers shall be solidary, unless the
management was assumed to save the things or
business from imminent danger (CIVIL CODE,
Art. 2146, par. 2); and
5. The officious manager shall be liable for any
fortuitous event:
a. If he undertakes risky operations which the
owner was not accustomed to embark upon;
b. If he has preferred his own interest to that of
the owner;
c. If he fails to return the property or business
after demand by the owner;
d. If he assumed the management in bad faith
(CIVIL CODE, Art. 2147);
e. Except when the management was
assumed to save the property or business
from imminent danger –
i. If he is manifestly unfit to carry the
management;
ii. If by his intervention he prevented a
more competent person from taking up
the management (CIVIL CODE, Art.
2148).
Responsibilities of the Owner:
The owner of the property shall be liable for
obligations incurred in his interest, and shall
reimburse the officious manager for the necessary
and useful expenses and for damages, which the
latter may have suffered in the performance of his
duties in the following instances:
1. When the owner of the property or business
enjoyed the advantages of the officious
management although it may not have been
expressly ratified by him (CIVIL CODE, Art.
2150, Par. 1).
2. When the management has for its purpose the
prevention of an imminent and manifest loss,
although no benefit may have been derived
(CIVIL CODE, Art. 2150, Par. 2).
3. Even if there had been no benefit to the owner
and there has been no imminent and manifest
danger to the property of business provided:
a. The officious manager has acted in good
faith; and
b. The property or business is intact, ready to
be returned to the owner (CIVIL CODE, Art.
2151).
NOTE: Even if the owner is a minor, he is still liable
under Article 2150 of the Civil Code for he should not
be unjustly enriched at another’s expense (5
PARAS, supra at 1162).
Liability for Contracts entered into by the
Officious Manager
The owner shall be liable for contracts which the
officious manager has entered into with third
persons when:
1. Such owner has expressly or tacitly ratified the
management; or
2. The contract refers to things pertaining to the
owner of the business (CIVIL CODE, Art. 2152).
When is Management Extinguished:
1. When the owner repudiates it or puts an end
thereto;
2. When the officious manager withdraws from the
management, subject to the provisions of Article
2144 of the Civil Code; and
3. By the death, civil interdiction, insanity or
insolvency of the owner or officious manager
(CIVIL CODE, Art. 2153).
SOLUTIO INDEBITI
This takes place when something is received when
there is no right to demand it, and it was unduly
delivered thru mistake (CIVIL CODE, Art. 2154).
It is presumed that there was a mistake in the
payment if something which had never been due or
had already been paid was delivered; but he from
whom the return is claimed may prove that the
delivery was made out of liberality or for any other
just cause (CIVIL CODE, Art. 2163).
Payment by reason of a mistake in the construction
or application of a doubtful or difficult question of law
may come within the scope of solutio indebiti (CIVIL
CODE, Art. 2155).
NOTE: Whether the question is “doubtful or difficult”
or not must be determined by the actual knowledge
of law of the person who made the payment. If the
payer was in doubt whether the debt was due, he
may recover if he proves that it was not due (CIVIL
CODE, Art. 2156).
Requisites of Solutio Indebiti:
1. Receipt (not mere acknowledgment) of
something (CIVIL CODE, Art. 2154);
2. There was no right to demand it because the
giver had no obligation (5 PARAS, supra at
1164); and
3. The undue delivery was because of mistake
either of fact or of law, which may be doubtful or
difficult question of law (CIVIL CODE, Art. 2155).
NOTE: Payment by a joint co-debtor for the benefit
of another co-debtor or co-surety is not solutio
indebiti but a payment by a person interested in the
fulfillment of the obligation under Article 1236 of the
Civil Code (5 PARAS, supra at 1165).
Primary Responsibility of a Payee: To return what
he has received through error or mistake although
there is no right to demand it (5 Paras, supra at
1164).
Liability of a Payee in Bad Faith:
1. Pay legal interest if the sum of money is
involved; or
2. Liable for fruits received or which should have
been received if the thing produces fruits (CIVIL
CODE, Art. 2159, par 1).
REASON: The payee assumes all risks having
acted fraudulently though damages may be
mitigated under Art. 2215 of the Civil Code (5
PARAS, supra at 1168).
3. He shall furthermore be answerable for any loss
or impairment of the thing from any cause and
for damages to the person who delivered the
thing, until it is recovered (CIVIL CODE, Art.
2159, par. 2).
Liability of Payee in Good Faith:
1. In case of impairment or loss, liability is only to
the extent of benefit; and
2. In case of alienation, price is to be reimbursed,
or in case of credit, the same should be assigned
(CIVIL CODE, Art. 2160).
NOTE: The responsibility of two or more payees,
when there has been payment of what is not due is
solidary (CIVIL CODE, Art. 2157).
Exemption from Obligation to Restore
This exemption shall apply to a payee, believing
good faith that the payment being made was for a
legitimate and subsisting claim, who:
1. Destroyed the document;
2. Allowed the action to prescribe;
3. Gave up pledges; or
4. Cancelled guaranties for his right (CIVIL CODE,
Art. 2162).
NOTE: He who paid unduly may proceed only
against the true debtor or the guarantor with whom
the action is still effective (CIVIL CODE, Art. 2162).
Right of a Third Person
When the property delivered or money paid belongs
to a third person, the payee shall comply with the
provisions of Article 1984 of the Civil Code (CIVIL
CODE, Art. 2158).
OTHER QUASI-CONTRACTS
1. When, without the knowledge of the person
obliged to give support, the support was given
by a stranger, unless it appears that he gave it
out of piety and without intention of being repaid
(CIVIL CODE, Art. 2164);

Requisites:
a. Support has been furnished in favor of a
dependent of one bound to give support but
who fails to do so;
b. The support was supplied by a stranger;
c. The same was given without the knowledge
of the person charged with the duty; and
d. It must not have been given without the
expectation of recovering it (Ramirez v.
Redfern, G.R. No. 26062, December 31,
1926).
2. When funeral expenses are borne by a third
person, without the knowledge of the relatives
obliged to give support to the deceased (CIVIL
CODE, Art. 2165);
3. When the person obliged to support an orphan,
or an insane or an indigent person unduly
refuses to give support to the latter, a third
person furnishes the support (CIVIL CODE, Art.
2166);
NOTE: As distinguished from Article 2164 of the
Civil Code, the obligor in the article unduly
refuses to support the persons referred to
therein (5 PARAS, supra at 1171).
9. When a possessor in good faith has incurred
necessary and useful expenses (CIVIL CODE,
Arts. 546 and 2172);
10. When a third person, without the knowledge of
the debtor, pays the debt (CIVIL CODE, Arts.
1236, 1237 and 2173);
11. When in a small community a majority of the
inhabitants of age decide upon a measure for
protection against lawlessness, fire, flood, storm,
or other calamity, anyone who objects to the plan
and refuses to contribute to the expenses but is
benefited by the project as executed shall be
liable to pay his share of said expenses (CIVIL
CODE, Art. 2174); and
12. When a third person was constrained to pay the
taxes of another (CIVIL CODE, Art. 2175).
NOTE: The foregoing provisions are mere
illustrations of other specific cases of quasi-
contracts; the enumeration has no preclusive effect
on possible other instances (5 PARAS, supra at
1176).

4. When through an accident or cause, a person is

injured or becomes seriously ill, and he is treated
or helped while he is not in a condition to give
consent to a contract, he shall be liable to pay
for the services of the physician or other person
aiding him, unless the service has been
rendered out of pure generosity (CIVIL CODE,
Art. 2167);

5. When during a fire, flood, storm, or other

calamity, property is saved from destruction by
another person without the knowledge of the
owner (CIVIL CODE, Art. 2168);

6. When the government, upon failure of any

person to comply with health or safety
regulations concerning property, undertakes to
do the necessary work, even over his objection
(CIVIL CODE, Art. 2169);

7. When by accident or other fortuitous event,

movables separately pertaining to two or more
persons are commingled or confused, the rules
on co-ownership shall apply (CIVIL CODE, Art.
2170);

8. When a person has found a lost personal

property (CIVIL CODE, Arts. 719, 720, and
2171);
 LOAN AND DEPOSIT

COMMODATUM SIMPLE EXTRA-JUDICIAL DEPOSIT JUDICIAL

LOAN/MUTUUM DEPOSIT

As to Subject Matter

GENERAL RULE: Non- Money or other Only movable (corporeal) things Movable as well
consumable goods consumable goods (CIVIL CODE, Art.1966; DE LEON, as immovable
(CIVIL CODE, Art. 1933). supra at 218). property (CIVIL
EXCEPTION: CODE, Art.
Consumable goods if 2006; DE LEON,
purpose is not the supra at 218).
consumption of the object.

(CIVIL CODE, Arts. 1933

and 1936; DE LEON,
supra at 9, 13).

As to Consideration

Essentially gratuitous Gratuitous or Onerous, GENERAL RULE: Gratuitous Onerous (DE

(CIVIL CODE, Art. 1933; that is, with a stipulation
DE LEON, supra at 13). to pay interest (CIVIL
CODE, Art. 1933; DE
NOTE: If onerous or LEON, Credit
compensation is paid, then Transactions, supra at
the contract may be Lease
13).
(CIVIL CODE, Art. 1935).
LEON, supra at
EXCEPTIONS: 218).
1. When there is an agreement to
the contrary;
2. Depositary is engaged in the
business of storing goods;
3. Where property saved from
destruction without knowledge by
the owner (CIVIL CODE, Art.
1965; DE LEON, supra at 218).

As to Nature of the Contract

Real contract; However, an accepted promise to Real contract; Nonetheless, for Not a contract. It
deliver something by way of commodatum or simple voluntary deposit, an agreement to is auxiliary to a
loan is a consensual contract (CIVIL CODE, Art. 1934; constitute a deposit is a consensual case pending in
DE LEON, supra at 14 and 12). contract (DE LEON, supra at 152 court.
(DE LEON,
supra at 217).

As to Purpose

Use or temporary Consumption (DE LEON, Custody and safekeeping of the To guarantee
possession (DE LEON, supra at 13). thing deposited for the benefit of the the right of the
supra at 13). depositary (DE LEON, supra at plaintiff in case
218). of a favorable
judgment (DE
LEON, supra at
218).
 COMMODATUM SIMPLE EXTRA-JUDICIAL DEPOSIT JUDICIAL
LOAN/MUTUUM DEPOSIT

As to Ownership of the Thing

Retained by the bailor Transferred to the debtor Retained by the owner (Generally, No transfer of
(CIVIL CODE, Art. 1933; (CIVIL CODE, Art. 1933; depositor must be the owner, but it ownership.
DE LEON, supra at 13). DE LEON, supra at 13). may belong to a person other than
a depositor) (CIVIL CODE, Art.
1962; DE LEON, supra at 148).

As to Possession of the Thing

Bailee has possession of the thing (DE LEON, supra Depositary has possession (CIVIL CODE, Art. 1962).
at 4).

As to Time of Return

GENERAL RULE: After Upon expiration of the Upon demand of depositor (CIVIL Upon order of
the expiration of the period term (CIVIL CODE, Art. CODE, Art. 1988). the court or
stipulated, or after the 1946;). when litigation
accomplishment of the use has ended
for which the commodatum (CIVIL CODE,
has been constituted Art. 2007; DE
LEON).
EXCEPTION: Bailor may
demand return or its
temporary use if he should
have urgent need of the
thing, or if the bailee
commits any acts of
ingratitude.
(CIVIL CODE, Arts. 1946
and 1948;).

As to Modes of Extinguishment

Upon the death of either Upon payment or Upon the loss or destruction of the Upon
the bailee or bailor, unless performance, thing deposited, return of the thing, termination of
by stipulation the condonation or novation, merger, expiration of the litigation or upon
commodatum is remission, term, fulfillment of the resolutory order of the court
transmitted to the heirs of merger, compensation, condition, annulment, rescission (CIVIL CODE,
either or both parties novation, annulment, Art. 2007).
rescission, fulfillment of a In case of gratuitous deposit, upon
(CIVIL CODE, Art. 1939; ).
resolutory condition, the death of either the depositor or
prescription (CIVIL depositary (CIVIL CODE, Arts.
CODE, Art. 1231). 1995, and 1231).

COMPROMISE
ARTS. 2028-2041
COMPROMISE
A compromise is a contract whereby the parties, by
making reciprocal concessions, avoid litigation or
put an end to one already commenced (CIVIL
CODE, Art. 2028).
BASIC DUTY OF THE COURT
WHENEVER A SUIT IS FILED
The court shall endeavor to persuade the litigants in
a civil case to agree upon some fair compromise
(CIVIL CODE, Art. 2029).
NATURE OF THE CONTRACT
A compromise is a consensual contract, and as
such, it is perfected upon the meeting of the minds
of the parties to the contract (2 ALBANO, Civil Law
Reviewer,(2020) p.1538).
A compromise is an agreement between two or
more persons who, for preventing or putting an end
to a lawsuit, adjust their respective positions by
mutual consent in the way they feel they can live
with. Reciprocal concessions are the very heart and
life of every compromise agreement, where each
party approximates and concedes in the hope of
gaining balance by the danger of losing. It is, in
essence, a contract (Clark Development
Corporation v. Mondragon Leisure and Resorts
Corporation et al, G.R. No. 150986, March 2, 2007).
Consent could be given not only by the party himself
but also by anyone duly authorized and acting for
and in his behalf (Id at p. 1540-1541).
GENERAL RULE: A contract entered into in the
name of another by one who has no authority or
legal representation, or who has acted beyond his
powers, shall be unenforceable. (CIVIL CODE, Art.
1317).
EXCEPTION: Unless it is ratified, expressly or
impliedly, by the person on whose behalf it has been
executed, before it is revoked by the other
contracting party (CIVIL CODE, Art. 1317). A
compromise agreement, like any other contract, may
be ratified. It has been held that although the
compromise agreement was signed by the husband
alone and therefore did not bind the wife who claims
the lot to be her paraphernal property, where the
wife actually had knowledge of the compromise and
executed acts tacitly to ratify the same, the
compromise agreement is binding on her, and a
decision rendered thereon valid. (Vda. de Mejia V.
Lohla & Lohla, G.R. No. L-9354, February 15, 1957)
LAW AND JURISPRUDENCE RECITE
THREE MINIMUM ELEMENTS FOR A
VALID CONTRACT: (COC)
1. Consent
2. Object certain which is the subject matter of the
contract
3. Cause of the Obligation which is established
(CIVIL CODE, Art. 1318).
ADDITIONAL REQUIREMENTS IN
CERTAIN CASES:
1. Special powers of attorney are necessary in:
(3) To compromise, to submit questions to
arbitration, to renounce the right to appeal from
a judgment, to waive objections to the venue of
an action or to abandon a prescription already
acquired (CIVIL CODE, Art. 1878).
NOTE: A special power to compromise does not
authorize submission to arbitration (CIVIL
CODE, Art. 1880).
2. Except when authorized by the other partners or
unless they have abandoned the business, one
or more but less than all the partners have no
authority to: (5) Enter into a compromise
concerning a partnership claim or liability (CIVIL
CODE, Art. 1818).
BINDING EFFECT
A compromise has upon the parties the effect and
authority of res judicata; but there shall be no
execution except in compliance with a judicial
compromise (CIVIL CODE, Art. 2037).
If the compromise has the effect of a novation, the
surety is released from liability. But if the
compromise is merely a reduction of the obligation,
the surety is still liable for the subsisting part
(Morales v. Fontanos, G.R. No. 43299, January 29,
1937).
JUDICIAL COMPROMISE
A compromise agreement that is intended to resolve
a matter already under litigation is normally called a
judicial compromise. Once it is stamped with
judicial imprimatur, it becomes more than a mere
contract binding upon the parties. Having the
sanction of the court and entered as its
determination of the controversy, it has the force
and effect of any other judgment. Such agreement
has the force of law and is conclusive between the
parties. It transcends its identity as a mere contract
binding only upon the parties thereto, for it becomes
a judgment that is subject to execution in
accordance with the Rules.
Thus, a compromise agreement that has been made
and duly approved by the court attains the effect and
authority of res judicata, although no execution may
be issued unless the agreement receives the
approval of the court where the litigation is pending
and compliance with the terms of the agreement is
decreed (Viesca v. Gilinsky, G.R. No. 171698, July
4, 2007).
Courts as a rule may not impose upon the parties a
judgment different from their compromise
agreement. It would be an abuse of discretion.
(Municipal Board v. Samahang Magsasaka, G.R.
No. L-25818, February 25, 1975)
CIRCUMSTANCES WHERE A The court's approval is necessary in compromises
PROCEEDING IN A CIVIL ACTION MAY
BE SUSPENDED
a. If willingness to discuss a possible compromise
is expressed by one or both parties; or
b. If it appears that one of the parties, before the
commencement of the action or proceeding,
offered to discuss a possible compromise but
the other party refused the offer (CIVIL CODE,
Art. 2030).
NOTE: The duration and terms of the suspension of
the civil action or proceeding and similar matters
shall be governed by such provisions of the rules of
court as the Supreme Court shall promulgate. Said
rules of court shall likewise provide for the
appointment and duties of amicable
compounders(CIVIL CODE, Art. 2030).
REQUIREMENT IN ORDER THAT A
COMPROMISE MAY BE EXECUTED
The must be approval of the court (2 ALBANO,
supra at p.1536).
COMPROMISE APPROVED BY THE
COURT IS NOT APPEALABLE
Adjective law governing judicial compromises
annunciates that once approved by the court, a
judicial compromise is not appealable and it thereby
becomes immediately executory but this rule must
be understood to refer and apply only to those who
are bound by the compromise and, on the
assumption that they are the ONLY parties to the
case, the litigation comes to an end except only as
regards to its compliance and fulfillment by the
parties of their respective obligations thereunder (Id
at p.1542).
REASON FOR THE RULE
The reason for the rule is that when both parties
enter into an agreement to end a pending litigation
and request that a decision be rendered approving
said agreement, it is only natural to presume that
such action constitutes an implicit, as undeniable as
an express, waiver of the right to
appeal against said decision. Thus, a decision on
a compromise agreement is final and executory, and
is conclusive between the parties (Unirock
Corporation vs Carpio and Hardrock Aggregates
Inc., G.R. No. 213421, August 24, 2020).
EARNEST EFFORT TO COMPROMISE
The courts may mitigate the damages to be paid by
the losing party who has shown a sincere desire for
a compromise (CIVIL CODE, Art. 2031).
COURT’S APPROVAL TO ENTER INTO
COMPROMISE IN CERTAIN CASES
entered into by: (GPAA)
a. Guardians,
b. Parents,
c. Absentee's representatives,
d. Administrators or Executors of decedent's
estates.
COMPROMISE WITHOUT THE
LAWYER’S INTERVENTION
A client has an undoubted right to settle a suit
without the intervention of his lawyer, for he is
generally conceded to have the exclusive control
over the subject-matter of the litigation and may, at
any time before judgment, if acting in good faith,
compromise, settle, and adjust his cause of action
out of court without his attorney's intervention,
knowledge, or consent, even though he has agreed
with his attorney not to do so. Hence, a claim for
attorney's fees does not void the compromise
agreement and is no obstacle to a court approval.
As the validity of a compromise agreement cannot
be prejudiced, so should not be the payment of a
lawyer's adequate and reasonable compensation for
his services should the suit end by reason of the
settlement (Gubat v. National Power Corporation,
G.R. No. 167415, February 26, 2010).
JURIDICAL PERSONS
Juridical persons may compromise only in the form
and with the requisites which may be necessary to
alienate their property.
COMPROMISE IN CIVIL CASES
In civil cases, an offer of compromise is not an
admission of any liability, and is not admissible in
evidence against the offeror. Neither is evidence of
conduct nor statements made in compromise
negotiations admissible, except evidence otherwise
discoverable or offered for another purpose, such as
proving bias or prejudice of a witness, negativing a
contention of undue delay, or proving an eff ort to
obstruct a criminal investigation or prosecution.
(REVISED RULES ON EVIDENCE, Sec 28).
COMPROMISE IN CRIMINAL CASES
There may be a compromise upon the civil liability
arising from an offense; but such compromise shall
not extinguish the public action for the imposition of
the legal penalty (CIVIL CODE, Art. 2036).
In criminal cases, except those involving quasi-
offenses (criminal negligence) or those allowed by
law to be compromised, an offer of compromised by
the accused may be received in evidence as an
implied admission of guilt (REVISED RULES ON
EVIDENCE, Sec 28).
COVERAGE OF COMPROMISE
A compromise comprises only those objects which
are definitely stated therein, or which by necessary
implication from its terms should be deemed to have
been included in the same (CIVIL CODE, Art. 2036).
A general renunciation of rights is understood to
refer only to those that are connected with the
dispute which was the subject of the compromise
(CIVIL CODE, Art. 2036).
Compromise agreement must be strictly interpreted
and must be understood as including only matters
specifically determined therein or which, by
necessary inference from its wording, must be
deemed included. Hence, it has been held, that a
compromise agreement abrogating the right of a
party to retain possession of a property as a lessee,
does not necessarily destroy her right of redemption
created by another contract (Dimatulac v. Coronel,
G.R. No. L-14132, January 22, 1920).
GENERAL RULE: There may be a compromise
upon the civil liability arising from an offense; but
such compromise shall not extinguish the public
action for the imposition of the legal penalty (CIVIL
CODE, Art. 2034).
REASON: Even where the offended party has
expressly waived indemnification, it is the duty of the
public prosecutor to bring criminal proceedings (U.S.
v. Leaño, G.R. No. 2741, August 16, 1906).
EXCEPTION: The NIRC authorizes the
Commissioner of Internal Revenue to compromise
violations of the NIRC. Where the taxpayer’s
violation of the Tax Code was compromised with the
approval of the Commissioner of Internal Revenue
and the City Fiscal, before any information was filed
in court, and the taxpayer paid the amount stated in
the compromise agreement, he cannot be
prosecuted anymore for the said violation for the Tax
Code (People v. Magdaluyo, G.R. No. L-16235, April
20, 1961).
WHAT CANNOT BE COMPROMISED
No compromise upon the following questions shall
be valid: (CVGSJL )
1. The Civil status of persons;
2. The Validity of a marriage or a legal separation;
3. Any Ground for legal separation;
4. Future Support;
5. The Jurisdiction of courts;
6. Future Legitime (CIVIL CODE, Art. 2035).
NOTE: The prohibitions in the Article 1490 and 1491
of the Civil Code are applicable to sales in legal
redemption, compromises and renunciations.
SALE OF PROPERTY BETWEEN
MARRIED SPOUSES
GENERAL RULE: Spouses cannot by compromise
evade the prohibition on the sale of property to one
another
EXCEPTIONS: (SJ)
1. When a Separation of property was agreed upon
in the marriage settlements; or
2. When there has been a Judicial separation of
property under article 191 (CIVIL CODE, Art.
1490).
WHEN MAY A COMPROMISE
AGREEMENT MAY BE ANNULLED OR
RESCINDED: (MCNE)
a. A compromise in which there is Mistake, fraud,
violence, intimidation, undue influence, or falsity
of documents (CIVIL CODE, Art. 2038).
NOTE: However, one of 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 (CIVIL
CODE, Art. 2038).
Where the compromise is instituted and carried
through in good faith, the fact that there was a
mistake as to the law or as to the facts, EXCEPT
in certain cases where the mistake was mutual
and correctible as such in equity, cannot afford
a basis for setting aside a compromise (Asong
vs IAC, G.R. No 74461, May 12, 1989)
It is a general rule in this country that
compromise are to be favored, without regard to
the nature of the controversy compromised, and
that they cannot be set aside because the event
shows all the gain to have been on one side,
and all the sacrifice on the other, if the parties
have acted in good faith, and with a belief of the
697
 actual existence of the rights which they have
respectively waived or abandoned (Id).
The law does not relieve a party from the effects
of an unwise, foolish or disastrous contract,
entered into with all the required legal
formalities and with full awareness of what he
was doing (Tanda v. Aldaya, G.R. No. L-3278,
July 23, 1951)
b. 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, unless said documents
have been Concealed by one of the parties
(CIVIL CODE, Art. 2039).
c. If it refers only to one thing to which one of the
parties has no right, as shown by the Newly-
discovered documents (CIVIL CODE, Art.
2039).
If the motion is denied, he may, considering the
special finality feature of compromise agreement,
albeit partial, and its susceptibility to execution, take
an appeal from the order of denial under Rule 45 or
even, when circumstances particularly warrant, the
extraordinary remedy prescribed in Rule 65, of the
Rules of Court (Id at p. 1543)
A PERSON WHO IS NOT A PARTY TO A
CONTRACT OR COMPROMISE MAY
NOT ENFORCE IT
It is axiomatic that a contract cannot be binding upon
and cannot be enforced against one who is not a
party to it, even if he is aware of such contract and
has acted with knowledge thereof (UP v. Philab
Industries Inc., G.R. No. 152411, September 29,
2004). A party person who is not a party to a
compromise agreement cannot be affected by it (2
ALBANO, supra at p.1544).

d. If after a litigation has been decided by a final INAPPLICABILITY OF ARTICLE 151

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 (CIVIL CODE,
Art. 2040)(AQUINO, Reviewer on Civil Law
(2018), p. 807).
NOTE: Ignorance of a judgment which may be
revoked or set aside is not a valid ground for
attacking a compromise (Id).
No suit between members of the same family shall
prosper unless it should appear from the verified
complaint or petition that earnest efforts toward a
compromise have been made, but that the same
have failed. If it is shown that no such efforts were in
fact made, the same case must be dismissed. This
rule shall not apply to cases which may not be
the subject of compromise under the Civil Code
(FAMILY CODE, Art. 151).

REASON: A valid compromise can be based

only upon doubt as to the rights of the parties,
and this doubt is non-existent when there is
already a final judgment on the matter
compromised (Rovero v. Amparo, G.R. No. L-
5482, May 2, 1952).

REMEDY IN CASE OF BREACH

If one of the parties fails or refuses to abide by the
compromise, the other party may either:
a. Enforce the compromise; or
b. Regard it as rescinded and insist upon his
original demand (CIVIL CODE, Art. 2041).

REMEDY OF THE PARTIES WHO DID

NOT TAKE PART OF THE COMPROMISE
AGREEMENT
Where there are parties in a case who did not
participate in the compromise agreement, but who
are adversely affected, they should not be precluded
from invoking in the same proceedings an adequate
relief. A motion to set aside the judgment to the
extent he might feel aggrieved, or might justifiably
fear to be at risk, by acquiescence unless timely
invoked, is a remedy (2 ALBANO, supra at p.1543).
 TORTS CLASSIFICATION OF
TORTS

TORTS
An unlawful violation of a private right, not created by
contract, and which gives rise to an action for
damages (AQUINO, Torts and Damages (2019), p.1
[hereinafter AQUINO, Torts and Damages]).
“Tort" consists in the violation of a right given or the
omission of a duty imposed by law. Simply stated,
tort is a breach of a legal duty (Naguiat v. NLRC, G.R.
No. 116123, March 13, 1997).
GENERAL CLASSES OF TORTS:
1. Property Torts
– Injuries and damages to real/personal property.
2. Personal Torts
–Injuries to person, i.e., body, reputation,
character or feelings (DE LEON, Comments &
Cases on Torts and Damages (2019), p.8
[hereinafter DE LEON, Torts and Damages]).

It is a “tortious liability” which arises from the breach
of a duty primarily fixed by laws; such duty is toward
persons, generally, and its breach is redressible by
an action for unliquidated damages (ALBANO, Torts
and Damages (2016), p.1 [hereinafter ALBANO,
Torts and Damages]).
BASIC PURPOSES OF TORTS LAW:
1. To provide a peaceful means for adjusting the
rights of the parties who might otherwise take the
law into their own hands;
2. To deter wrongful conduct;
3. To encourage socially responsible behavior; and
4. To restore injured parties to their original
condition insofar as the law can do this
(ALBANO, Torts and Damages, supra at 10-11).
KINDS OF TORT LIABILITIES:
1. Negligent Tort (Negligence)
– Involves voluntary acts or omissions that result
in injury to others, without intending to cause the
same. The actor fails to exercise due care in
performing such acts or omissions (AQUINO,
Torts and Damages, supra at 2).
2. Intentional Tort
– Tort is intentional if an actor desires to cause
the consequences of his act or he believes that
the consequences of his acts are certain to cause
damage to another (ALBANO, Torts and
Damages supra at 3).
It includes assault, battery, false imprisonment,
defamation, invasion of privacy, and interference
of property (AQUINO, Torts and Damages supra
at 3).

3. Strict Liability in Tort

– The person is made liable independent of fault
or negligence upon submission of proof of certain
facts. The conduct is generally not wrongful in
itself but the wrong consists in causing harm by

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA R. TAMPUS, Vice
Chairperson for Secretariat | ARVY KEITH N. CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice
Chairperson for Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. TIMOTEO B. AQUINO and Atty. JESUS ERICK F. STA. BARBARA

 engaging in certain types of risky activities (Id. at
7).
REMEDIES FOR TORTS:
1. Compensatory
– actions for sum of money for damages suffered
(AQUINO, Torts and Damages, supra at 33).
2. Preventive
– prayer for injunction, and a writ of preliminary
injunction and a temporary restraining order, to
enjoin the defendant from continuing the doing of
the tortious conduct (Id.).
3. Restitution
– to disgorge gains that the defendant wrongfully
obtained by tort (DE LEON, Torts and Damages,
supra at 15).
LEGAL INJURY
No obligation will be recognized and enforced by our
courts unless the plaintiff can justify said obligation as
arising from one of the sources enumerated in Art.
1157 of the New Civil Code. Of these sources of
obligations, only law, delict, and quasi delict may
be appropriately cited as sources of tort liability
(AQUINO, Torts and Damages, supra at 36-37).
CAUSE OF ACTION IN TORT
Test: Whether the defendant owed plaintiff any legal
duty to do something which defendant wrongfully did
not do, or not to do something which he wrongfully
did, in violation of plaintiff’s legal right or rights (DE
LEON, Torts and Damages, supra at 29).
ELEMENTS: (ROW)
1. A legal Right in favor of a person (plaintiff);
2. A correlative legal Obligation on the part of
defendant to respect or not to violate such right;
and
NOTE: Moral rights and duties – those duties
which are dictated merely by good morals or by
humane considerations are not within the domain
of the law (Id. at 30).
3. A Wrong, i.e., an act or omission in violation of
said legal right and duty with consequent injury or
damage to the plaintiff (Id. at 29).
CONCURRENCE OF CAUSES OF
ACTION:
1. A single act or omission may give rise to two or
more causes of action, i.e., based on delict,
quasi-delict and contract;
2. Two persons may be liable for one act or
omission that causes the injury; and
3. There may be a concurrence of actions even if
only one person is sought to be held liable.
(AQUINO, Torts and Damages supra at 49-50)
Choice of remedy in concurrence of causes of action
pertains to procedural and jurisdictional issues of
action. The remedy may be based on a delict or
quasi-delict. A quasi-delict action may proceed
independently from the criminal action (Barredo v.
Garcia, G.R. No. L-48006, July 8, 1942); but it is
subject to the proscription against double recovery
(CIVIL CODE, Art. 2177).
MATERIALITY OF MOTIVE
Where motive is material under the circumstances of
the particular case, a bad motive, in connection with
conduct which violates plaintiff’s rights, has been held
to render the conduct tortuous (DE LEON, Torts and
Damages, supra at 40).
A bad motive is occasionally important in cases
involving certain economic torts, e.g., interference
with business opportunity without physical threat or
harm and claims for punitive damages (Id.).
MATERIALITY OF INTENT
Liability in tort for an injury is determined by conduct,
and can arise regardless of the mental state or intent
to commit an unlawful act (Id. at 42).
PROSCRIPTION ON DOUBLE
RECOVERY
Although a single act or omission may give rise to two
different causes of action, the plaintiff cannot recover
damages twice for the same act or omission of the
defendant (CIVIL CODE, Art. 2177).
Inasmuch as civil liability co-exists with criminal
responsibility in negligence cases, the offended party
has the option between an action for enforcement of
civil liability based on culpa criminal under Article 100
of the Revised Penal Code and an action for
damages based on culpa aquiliana under Article
2177 of the Civil Code.
These two civil liabilities are distinct and independent
of each other; the failure to recover in one will not
necessarily preclude recovery in the other (People v.
Billaber y Matbanua, G.R. No. 114967-68, January
26, 2004).
 CULPA
NEGLIGENCE AQUILIANA
OR CULPA
CULPA CULPA
EX-
CRIMINAL CONTRACTUAL
CONTRACTU
NEGLIGENCE (QUASI-
DELICT)
The fault or negligence of the obligor consists in the
omission of that diligence which is required by the performance
nature of the obligation and corresponds with the (CIVIL CODE,
circumstances of persons, place and time (CIVIL Art. 1173).
CODE, Art. 1173).
As to the Nature of Negligence
There is no hard and fast rule whereby such degree
of care and vigilance is calibrated; it is dependent Direct, Direct, Negligence is
upon the circumstances in which a person finds substantive substantive and merely incident
himself. All that the law requires is that it is and independent to the
perpetually compelling upon a person to use that care independent. (Huang v. performance of
and diligence expected of sensible men under Philippine an obligation
comparable circumstances (PNR v. CA, G.R. Hoteliers, Inc., already existing
No.157658, October 15, 2007). G.R. No. because of a
180440, contract (Huang
The existence of negligence in a given case is not December 5, v. Philippine
determined by reference to the personal judgment of 2012). Hoteliers, Inc.,
the actor in the situation before him. The law G.R. No. 180440,
considers what would be reckless, blameworthy, or December 5,
negligent in the man of ordinary intelligence and 2012).
prudence and determines liability by that (Picart v.
Smith, Jr., G.R. No. L-12219, March 15, 1918). As to the Proof Needed

Proof Preponderance Preponderance

MOTIVE NOT MATERIAL beyond of evidence of evidence
Motive is not material in negligence cases. The reasonable (RULES OF (RULES OF
defendant may still be held liable even if the act was doubt COURT, Rule COURT, Rule
meant to be a practical joke (AQUINO, Torts and (Barredo v. 133, Section 1, 133, Section 1,
Damages, supra at 61). Garcia, G.R. Casupanan v. Barredo v.
No. L-48006, Laroya, G.R. Garcia, G.R. No.
KINDS: July 8, No. 145391, L-48006, July 8,
1942). August 26, 1942).
2002).
CULPA CRIMINAL V. CULPA AQUILIANA
V. CULPA CONTRACTUAL
CULPA As to the Existence of Pre-Existing
AQUILIANA Contractual Obligation
OR CULPA
CULPA CULPA None. No pre-existing There is pre-
EX-
CRIMINAL CONTRACTUAL obligation existing
CONTRACTU
(except the duty obligation (a
(QUASI-
to be careful in contract, either
DELICT)
all human express or
As to the Basis of Liability actuations) implied) (Huang
(Huang v. v. Philippine
Existence of Fault or Obligation arises Philippine Hoteliers, Inc.,
a law clearly negligence from the breach Hoteliers, Inc., G.R. No. 180440,
punishing resulting in of the contract G.R. No. December 5,
the act damage or because of 180440, 2012).
(Nullum injury to another defendant’s December 5,
crimen sine (CIVIL CODE, failure to 2012).
lege). Art. 2176). exercise due
care in its
 CULPA CULPA
AQUILIANA AQUILIANA
OR CULPA OR CULPA
CULPA CULPA CULPA CULPA
EX- EX-
CRIMINAL CONTRACTUAL CRIMINAL CONTRACTUAL
CONTRACTU CONTRACTU
(QUASI- (QUASI-
DELICT) DELICT)

As to the Employer’s Defense of Exercising G.R. No. 141910,

the Diligence of “Good Father of a Family” in August 6, 2002).
the Selection and Supervision of his
Employees In culpa
contractual, the
Not a proper As a general Not a complete plaintiff only
defense. rule, a complete and proper needs to
(ALBANO, proper defense. defense establish the
Torts and existence of the
Damages, However, even contract and the
supra at 7). if the employer obligor’s failure
can prove the to perform his
diligence in the obligation
selection and (Torres-Madrid
supervision (the Brokerage, Inc.
latter aspect v. FEB Mitsui
has not been Marine Insurance
established Co. Inc., G.R. No.
herein) of the 194121, July 11,
employee, still if 2016).
he ratifies the
wrongful acts, As to the Nature of the Right Violated
or take no step
to avert further Public right. Private right. Private right.
damage, the
employer would As to the Governing Law
still be
Governed by Governed by Governed by
liable. (Spouses
Art. 365 of Art. 2176; Arts. Arts. 1170-1174
Fontanilla v.
the Revised 1172-1174 are of the CIVIL
Hon. Maliaman,
Penal Code. also applicable CODE.
G.R. No. L-
(CIVIL CODE,
55963
Art. 2178).
December 1,
1989).
DEGREES OF NEGLIGENCE:
As to the Presumption of Negligence
1. Simple Negligence
The No presumption The presumption – failure to observe for the protection of another
innocence of of negligence. of negligence person that degree of care, precaution, and
the accused Injured party in culpa vigilance which the circumstances justly demand,
is presumed must prove the contractual, whereby such other person suffers injury (Gaid v.
until the negligence of immediately People, G.R. No. 171636, April 7, 2009).
contrary is the defendant attaches by a
proven. (Cangco v. failure of the Elements:
Manila Railroad covenant or its (1) There is lack of precaution on the part of the
Company, G.R. tenor (FGU offender; and
No. L-12191, Insurance (2) The damage impending to be caused is not
October 14, Corporation v. immediate or the danger is not clearly
1918). G.P. Sarmiento manifest (St. Luke’s College of Medicine v.
Trucking Perez, G.R. No. 222740, September 28,
Corporation, 2016).
2. Gross Negligence
– one that is characterized by the want of even
slight care, acting or omitting to act in a situation
where there is a duty to act, not inadvertently but
willfully and intentionally with a conscious
indifference to consequences insofar as other
persons may be affected (Baño vs. Bachelor
Express, GR No. 191703, March 12, 2012).
In quasi-delicts, exemplary damages may be
granted if the defendant acted with gross
negligence (CIVIL CODE, Art. 2231).
CULPA AQUILIANA OR QUASI-DELICT
It is an act or omission which causes damage to
another, there being fault or negligence and there
being no pre-existing contractual relationship
between the parties (CIVIL CODE, Art. 2176).
The concept of quasi-delict in Art. 2176 is broad; it
includes not only injuries to persons but also damage
to property (Cinco v. Canonoy, G.R. No. L-33171,
May 31, 1979).
Requisites: (ANICC)
1. An Act or omission;
2. The presence of fault or Negligence in the
performance or non-performance of an act;
3. Injury;
4. Causal connection between the negligent act and
the and the injury; and
5. No pre-existing Contractual relation (St. Martin
Polyclinic, Inc. v. LWV Construction Corporation,
G.R. No. 217426, December 4, 2017).
NOTE: Even prior to the enactment of the New Civil
Code, the Supreme Court had already adopted, in
some of its decisions, a broad concept of torts using
Article 1902 of the old Civil Code. It is noteworthy that
the same broad interpretation of quasi-delict had
been given to Article 2176, the provision on quasi-
delict under the New Civil Code. The Supreme Court
observed in a number of cases that Article 2176
includes intentional acts (AQUINO, Torts and
Damages, supra at 8-9).
An action for quasi-delict can be maintained even if
there is an existing contractual relation between the
parties, provided that in all such cases, the elements
of quasi-delict are present and the existence of
contract is merely incidental (Id. at 31).
REASON: The field of non- contractual obligation
[which includes quasi-delicts] is much broader than
that of contractual obligations, comprising, as it does,
the whole extent of juridical human relations. These
two fields, figuratively speaking, concentric; that is to
say, the mere fact that a person is bound to another
by contract does not relieve him from extra-
contractual liability to such person. When such a
contractual relation exists the obligor may break the
contract under such conditions that the same act
which constitutes the source of an extra-contractual
obligation had no contract existed between the
parties (Cangco v. Manila Railroad, Co., G.R. No. L-
12191, October 14, 1918).
STANDARD OF CARE: DILIGENCE OF A
GOOD FATHER OF A FAMILY (PATER
FAMILIAS) (CIVIL CODE, Art. 1173 in relation to
Art. 2178).
It is he who, in the performance of an act should
foresee the consequences of the same. If he does,
he is not negligent (ALBANO, Torts and Damages,
supra at 34). What should be determined in
negligence cases is what is foreseeable to a good
father of a family (AQUINO, Torts and Damages,
supra at 81).
A good father of a family is also referred to as the
reasonable man, man of ordinary intelligence and
prudence, or ordinary reasonable prudent man (Id. at
82).
The law requires a man to possess ordinary capacity
to avoid harming his neighbors unless a clear and
manifest incapacity is shown; but it does not generally
hold him liable for unintentional injury unless,
possessing such capacity, he might and ought to
have foreseen the danger (Id. at 83).
TESTS TO DETERMINE THE EXISTENCE
OF NEGLIGENCE:
1. Did the defendant in doing the alleged negligent
act use reasonable care and caution which an
ordinarily prudent person would have used in the
same situation? If not, there is negligence (Picart
v. Smith, G.R. No. L-12219, March 15, 1918).
2. Could a prudent man, in the case under
consideration, foresee harm as a result of the
course pursued? If so, it was the duty of the actor
to take precautions to guard against harm (Id.).
Conduct is negligent when a prudent man in the
position of the tortfeasor would have foreseen that an
effect harmful to another was sufficiently probable to
warrant his disregard of the conduct or guarding
against its consequences (Id.).
“DILIGENCE BEFORE THE FACT”
The conduct that should be examined in negligence
cases is conduct prior to the injury or the aggravation
thereof (St. Francis High School v. CA, G.R. No.
82465, February 25, 1991).
NOTE: The state of mind of the actor is not important.
Good faith or use of sound judgment is immaterial
(Picart v Smith, supra).
Only juridical fault is subject to liability and not moral
fault (AQUINO, Torts and Damages, supra at 53).
CIRCUMSTANCES THAT MAY AFFECT
THE DETERMINATION OF NEGLIGENCE:
(PEST-GAP)
1. Person exposed to the risk
In proper cases, higher degree of diligence
required if a child is involved, even if a trespasser,
because entry of children in vacant lot may be
foreseeable, such that the law imposes a duty of
care towards children even if ordinarily there is no
duty under the same circumstance if the person
involved is an adult with sufficient discretion.
(AQUINO, Torts and Damages, supra at 78-79).
2. Emergency
Emergency Rule or Sudden Peril Doctrine
GENERAL RULE: An individual who suddenly
finds himself in a situation of danger and is
required to act without much time to consider the
best means that may be adopted to avoid the
impending danger is not guilty of negligence if he
fails to undertake what subsequently and upon
reflection may appear to be a better solution (Id.
at 73, Makati Auto Line Transport Corporation v.
People, G.R. No. 152040, March 31, 2006).
REASON: A person who is confronted with a
sudden emergency may be left with no time for
thought and must make a speedy decision largely
upon impulse or instinct (AQUINO, supra at 73).
EXCEPTION: The emergency rule cannot be
invoked if the person invoking it found himself in
danger which he himself created through his own
negligence (Delsan Transport v. C and A
Construction, Inc., G.R. No. 156034, October 1,
2003).
3. Social value or utility of action
Any act subjecting an innocent person to
unnecessary risk is a negligent act if the risk
outweighs the advantage accruing to the actor
and even to the innocent person himself
(AQUINO, Torts and Damages, supra at 76).
Illustration:
As has often been pointed out, if all the trains in
the country were restricted to a speed of five
miles an hour, there would be fewer accidents,
but our national life would be intolerably slowed
down. The purpose to be served, if sufficiently
important, justifies the assumption of abnormal
risk (Id.).
4. The Time of the day may affect the
diligence required of the actor (CIVIL
CODE, Art. 1173), e.g., more prudence is
required when driving at night (Id. supra at 72).
5. Gravity of the harm to be avoided
Even if the odds that an injury will result are not
high, harm may still be considered foreseeable if
the gravity of harm to be avoided is great (Id.
supra at 75).
6. Alternative courses of action
If the alternative presented to the actor is too
costly, the harm that may result may still be
considered unforeseeable to a reasonable man.
More so if there is no alternative thereto (Id. at
76).
7. Place
The place where the actor is located may affect
the diligence required from him, e.g., ordinary or
reasonable care in the operation of a motor
vehicle at an intersection would naturally require
more precaution than is necessary when driving
elsewhere in a street or highway (Caminos v.
People, G.R. No. 147437, May 8, 2009).
CIRCUMSTANCES MATERIAL IN
DETERMINING NEGLIGENCE:
(WINE-PICK)
1. Women
Whether the passenger acted prudently or
recklessly – the age, sex, and physical condition
of the passenger are circumstances necessarily
affecting the safety of the passenger should be
considered (AQUINO, Torts and Damages, supra
at 112).
A woman driving a vehicle suddenly crippled by
a flat tire on a rainy night will not be faulted for
stopping at a point which is both convenient for
her to do so and which is not a hazard to other
motorists. However, it can also be reasonably
argued that the same conclusion can be reached
if it was a man who was in the position of the actor
(Valenzuela v. CA, G.R. No. 115024, February 7,
1996).
2. Intoxication
GENERAL RULE: Mere intoxication is not
negligence nor establishes want of ordinary care.
But it may be one of the circumstances to be
considered to prove negligence (Wright v. Manila
Electric Railroad & Light Co., G.R. No. 7760,
October 1, 1914).
EXCEPTION: A person driving a motor vehicle is
presumed negligent if he is violating any traffic
regulation at the time of the mishap (CIVIL
CODE, Art. 108).
3. Nature of Activity
When persons impose upon themselves certain
obligations, non-compliance therewith will be
considered negligence, e.g., railroad company on
having a gate at a railroad crossing (AQUINO,
Torts and Damages, supra at 107).
Some activities by nature impose duties to
exercise higher degree of diligence; e.g. banks
are required to exercise the highest degree of
diligence in the conduct of its affairs (Prudential
Bank v. Rapanot, G.R. No. 191636, January 16,
2017) and common carriers, from the nature of
their business and for reasons of public policy,
are bound to observe extraordinary diligence in
the vigilance over the goods and for the safety of
the passengers transported by them, according
to all the circumstances of each case (CIVIL
CODE, Art. 1733).
NOTE: Distribution utilities are public utilities
vested with public interest, and thus, are held to
a higher degree of diligence (Manila Electric Co.
v. Nordec Philippines, G.R. No. 196020, April 18,
2018).
4. Experts and Professionals
An expert should exhibit the care and skill of one
ordinarily skilled in the particular field that he is
in. Those who undertake any work calling for
special skills are required not only exercise
reasonable care in what they do but also possess
a standard minimum of special knowledge and
ability (AQUINO, Torts and Damages, supra at
103).
The rule regarding experts is applicable not only
to professionals, like doctors, lawyers, pilots and
others, who have undergone formal education
(Id. at 106).
5. Physical Disability
GENERAL RULE: The weakness of a person will
not be an excuse in negligence cases. One
should not undertake a task in which he knows or
ought to know, that his weakness may be a
danger to others (Id. at 99).
EXCEPTION: If the defect amounts to a real
disability, the standard of conduct is that of a
reasonable person under like disability, e.g., the
standard of conduct for a blind person becomes
that of a reasonable person who is blind
(Francisco v. Chemical Bulk Carriers
Incorporated, G.R. No. 193577, September 9,
2011).
6. Insanity
Under the Revised Penal Code, an insane
person is exempt from criminal liability but may
not be exempted from civil liability (AQUINO,
Torts and Damages, supra at 111).
Under the Civil Code, the insanity of a person
does not excuse him or his guardian from liability
based on quasi-delict (CIVIL CODE, Arts. 2180
and 2182).
Bases for Holding an Insane Person Liable
for His Tort:
a. Between two innocent persons, the loss
should be borne by the one who occasioned
it;
b. To induce those interested in the estate of
the insane person to restrain and control him;
and
c. The fear that insanity would lead to false
claims of insanity and avoid liability
(AQUINO, Torts and Damages, supra at
100).
7. Children
The care and caution required of a child is
according to his maturity and capacity only and
this is to be determined in each case by the
circumstances of the case the question of
negligence necessarily depends on the ability of
the minor to understand the character of his own
acts and their consequences (Taylor v. Meralco,
G.R No. 4977, March 22,1910).
If the child is under nine years, it is no longer
necessary to determine his maturity and capacity
because he is conclusively presumed to be
incapable of negligence. If the child is above nine
to fifteen, he is disputably presumed to be
incapable of negligence but the opposing party
can prove that the child is at such stage of
maturity and capacity that he can already
determine what a reasonable man would do
under the same circumstances (Jarco Marketing
Corporation, et al. v. CA, supra).
If the child is legally incapable of discernment, the
parents or any person exercising parental
authority over him may still be liable if proper
diligence in supervising the child was not
observed. The actor himself is liable up to the
extent of his properties (AQUINO, Torts and
Damages, supra at 92).
8. Knowledge and Experience of the Actor
There are matters which a prudent man is
conclusively presumed to know based on
knowledge and experience, e.g., familiarity of the
place means knowledge of the makeup of the
same area; or the basic laws of nature or physics
(Id. supra at 84).
OTHER FACTORS TO CONSIDER IN
DETERMINING THE PRESENCE OF
NEGLIGENCE:
1. Violation of Rules and Statutes
a. Statutes and Ordinances
GENERAL RULE: Violation of a statutory
duty is negligence per se (Cipriano v. CA,
G.R. No. 107968, October 30, 1996). The
reason for this is that the statute or ordinance
becomes the standard of care or conduct to
which the reasonably prudent person is held.
EXCEPTIONS: (US)
i. When Unusual conditions occur and
strict observance may defeat the
purpose of the rule that may even lead to
adverse results; or
ii. When the Statute provides that the
violation merely establishes a There is negligence if a prudent man in the
presumption of negligence (AQUINO,
Torts and Damages, supra at 127-128
citing Tedla v. Ellman, 280 N.Y. 124, 19
N.E. 2D 987(1939)).
b. Administrative Rules
Violation of a rule promulgated by
administrative agencies is not negligence per
se, but may be evidence of negligence
(Marinduque Iron Mines Agents, Inc. v. The
Workmen’s Compensation Commission,
G.R. No. L-8110, June 30, 1956).
c. Private rules of Conduct
Violation of rules imposed by private
individuals (e.g., employers) is merely a
possible evidence of negligence
(AQUINO, Torts and Damages, supra at
128).
NOTE:
Compliance/non-compliance with customs and
practices does not necessarily mean that the
actor was negligent/not negligent (Id. at 134).
A practice which is dangerous to human life
cannot ripen into a custom which will protect
anyone who follows it (Yamada v. Manila
Railroad, G.R. No. 10073, December 24, 1915).
TEST OF NEGLIGENCE
FORESEEABILITY
To be negligent, a defendant must have acted or
failed to act in such a way that an ordinary reasonable
man would have realized that certain interests of
certain persons were unreasonably subjected to a
general but definite class of risks (R Transport Corp.
v. Yu, G.R. No. 174161, February 18, 2015).
Foreseeability is the fundamental test of negligence.
In determining whether the actor was negligent, the
court will place itself in the actor’s position to see if a
prudent man could have foreseen the resulting harm
if the conduct is pursued (AQUINO, Torts and
Damages, supra at 55).
Even if the particular injury was not foreseeable, the
risk is still foreseeable if possibility of injury is
foreseeable (Id.).
TESTS OF FORESEEABILITY:
1. Unreasonable or Undue Risks
This risk is a danger which is apparent, or should
be apparent, to one in the position of the actor. It
is a risk that is reasonably foreseeable (Id. at 58).
2. Probability
position of the tortfeasor would have foreseen
that the harmful effect was sufficiently probable
to warrant his conduct or guarding against its
consequence (Picart v. Smith, Jr., G.R. No. L-
12219, March 15, 1918). If there is a great
probability and risk that damage will result, a
person is negligent if he did not exercise due
diligence in the face of such great probability
(AQUINO, Torts and Damages, supra at 59).
Even if there is a lesser degree of probability that
damage will result, the damage may still be
considered foreseeable (Id. at 60).
CALCULATION OF RISK:
1. Risk-Benefit Analysis
– Balancing the risk, in light of the social value of
the interest threatened and the probability and
extent of the harm against the value of the
interest which the actor is seeking to protect, and
the expedience of the course pursued.
The following circumstances should therefore be
considered:
a. Gravity of the harm to be avoided;
b. Utility of conduct or the social value it seeks
to advance; and
c. Alternative course of action, dangers, and
advantages to the person or property of the
actor himself and to others (Id. at 68).
2. The Hand Test
– Reduced the risk benefit to a negligence
formula: If the probability be called P; the injury L;
and the burden B; liability depends upon whether
B is less than L multiplied by P (Id. at 69).
The rule in the Philippines is that the risk-benefit
analysis and the hand test do not apply. Courts in this
jurisdiction do not use any formula in determining if
the defendant committed a negligent act or omission
(Id. at 70).
BURDEN OF PROOF
GENERAL RULE: The negligence or fault should be
clearly established as it is the basis of the action. The
burden of proof is upon the plaintiff (St. Martin
Polyclinic, Inc. v. LWV Construction Corporation,
G.R. No. 217426, December 04, 2017).
EXCEPTIONS: When the rules or the law provide for
cases when negligence is presumed (AQUINO, Torts
and Damages, supra at 143).
1. Disputable Presumptions of Negligence
a. Motor vehicle Mishaps – a driver is
presumed negligent if he:
i. Was found guilty of reckless driving or
violating traffic regulations at least twice
within the preceding two (2) months
(CIVIL CODE, Art. 2184, Par. 1); or
ii. Was violating any traffic regulation at the
time of the mishap (CIVIL CODE, Art.
2185).
NOTE: R.A. 4136 (Land Transportation
and Traffic Code) provides for instances
of traffic rules commonly violated by
drivers, such as exceeding registered
capacity and obstruction of traffic.
b. Possession of dangerous weapons or
substances, such as firearms and poison that
results in death or injury, except when the
possession or use thereof is indispensable in
his occupation or business (CIVIL CODE,
Art. 2188).
c. Common carriers are presumed to have
been at fault or acted negligently in case of
death or injuries to passengers, unless they
prove that they observed extraordinary
diligence prescribed in Articles 1733 and
1755 (CIVIL CODE, Art. 1756, SANGCO,
Torts and Damages (1984), p. 108)
[hereinafter SANGCO, Torts and Damages].
There is No Liability Under Article 2176:
a. Where there was a pre-existing contractual
relationship, except when the act of
breaching the contract is also tortious;
b. When the action is already barred by
prescription i.e. the action for quasi-delict is
instituted after four (4) years from the accrual
of the cause of action;
c. The injury suffered by a person is the result
of a fortuitous event; and
d. If there is no damage or injury caused to
another party (PINEDA, Torts and Damages
(2009), p. 16-17 [hereinafter PINEDA, Torts
and Damages]).
2. Res Ipsa Loquitur
“The thing or transaction speaks for itself.”
The doctrine of res ipsa loquitur is simply a
recognition of the postulate that, as a matter of
common knowledge and experience, the very
nature of certain types of occurrences may justify
an inference of negligence on the part of the
person who controls the instrumentality causing
the injury in the absence of some explanation by
the accused-appellant who is charged with
negligence. It is grounded in the superior logic of
ordinary human experience and, on the basis of
such experience or common knowledge,
negligence may be deduced from the mere
occurrence of the accident itself. Hence, res ipsa
loquitur is applied in conjunction with the doctrine
of common knowledge (Jarcia, Jr. v. People,
G.R. No. 187926, February 15, 2012).
The doctrine is not meant to and does not
dispense with the requirement of proof of
culpable negligence against the party charged,
rather, it merely determines and regulates what
shall be prima facie evidence thereof, and helps
the plaintiff in proving a breach of the duty
(Solidum v. People, G.R. No. 192123, March 10,
2014).
The thing which caused the injury, without the
fault of the injured, is under the exclusive control
of the defendant and the injury is such that it
would not have occurred if he, having such
control, used proper care (ALBANO, Civil Law
Reviewer, supra at 934).
The doctrine is an exception to the rule that in
quasi-delict cases, the burden of proof lies in the
plaintiff to show negligence of the defendant. It
has been resorted to where no direct evidence
can be presented as to prove the liability of a
person (ALBANO, Torts and Damages, supra at
57).
Requisites: (ACE)
a. The Accident is of a kind which ordinarily
does not occur in the absence of someone’s
negligence;
b. It is caused by an instrumentality within the
exclusive Control of the defendant or
defendants; and
c. The possibility of contributing conduct which
would make the plaintiff responsible is
Eliminated (Tan v. Jam Transit, Inc., G.R. No.
183198, November 25, 2009).
“Control of the Instrumentality” which caused
the damage is the fundamental element. Such
element of control must be shown to be within the
dominion of the defendant (AQUINO, Torts and
Damages, supra at 149).
 The doctrine is inapplicable when:
a. There is a direct proof of absence or
presence of negligence (Huang v. Philippine
Hoteliers, Inc., supra); or
b. When an unexplained accident may be
attributable to one of several causes, for
some of which defendant could not be held
responsible (FGU Insurance Corporation v.
G.P. Sarmiento Trucking Corporation,
supra).
AFFIRMATIVE DUTIES AND
MISCELLANEOUS ACTIVITIES:
GENERAL RULE: It is not part of the general duty of
care to perform a positive obligation; there is no
affirmative duty to perform an act for the benefit of
another (Cangco v. Manila Railroad Company, G.R.
No. 12191, October 14, 1918).
CLASSES:
1. DUTY TO THE RESCUER (GOOD
SAMARITAN RULE)
One who was hurt trying to rescue another who
was injured through negligence may recover
damages from the person who originally caused
the injury (not the rescued person) (AQUINO,
Torts and Damages, supra at 166).
Requisites to Make a Tortfeasor Liable to the
Rescuer: (NICA)
a. The tortfeasor was Negligent to the person
rescued and such negligence caused the
peril or the appearance of peril to the person
rescued;
b. The peril or the appearance of peril was
Imminent;
c. A reasonable prudent person who would
have Concluded such peril or appearance of
peril existent; and
d. The rescuer Acted with reasonable care in
effectuating the rescue (Id. at 169).
2. DUTY TO RESCUE
Even if the failure to help a victim of an accident
might be morally reprehensible, the person who
abstain from helping the victim is not legally
responsible. A person is bound to act with
prudence but not with charity (Id. at 171).
EXCEPTIONS:
Limited duty to rescue
a. In cases specified in Article 275 of the
Revised Penal Code:
i. To render assistance to any wounded
person or in danger of dying, found in an
uninhabited place, when assistance can
be rendered without danger to himself,
unless such omission shall constitute a
more serious offense;
ii. To render assistance to another whom
one has accidentally wounded or injured;
iii. To deliver an abandoned child under
seven years of age to the authorities or
his family or take him to a safe place;
b. No driver of a motor vehicle concerned in a
vehicular accident shall leave the scene of
the accident without aiding the victim unless
he is excused from doing so (R.A. 4136,
Land Transportation and Traffic Code, Sec.
55);
c. Individuals required by law to take care of
another person, e.g., parents to their children
or guardians to their wards; and
d. The defendant in special relationships (e.g.,
Common Carrier-passenger, innkeeper-
guest) (AQUINO, Torts and Damages, supra
at 171-173).
3. DUTIES OF OWNERS, PROPRIETORS
AND POSSESSORS OF PROPERTY
General Rule: The owner has no duty to take
reasonable care towards a trespasser for his
protection or even to protect him from concealed
danger (Id. at 173).
EXCEPTIONS: (VATS)
a. Visitors;
Owners of buildings or premises owe a duty
of care to visitors (Cabigao v. University of
the East, CA-G.R. No. 33554-R; August 24,
1973). Common carriers may be held liable
for negligence to persons who stay in their
premises even if they are not passengers (Id.
at 175).
b. Doctrine of Attractive Nuisance (Torpedo
or Turntable Doctrine);
An owner who maintains on his premises
dangerous instrumentalities or appliances of
a character likely to attract children in play,
and fails to exercise ordinary care to prevent
children from playing therewith or resorting
thereto, is liable to a child of tender years
who is injured thereby, even if the child is
technically a trespasser in the premises
(Hidalgo Enterprises, Inc. v. Balandan, G.R.
No. L-3422, June 13, 1952).
NOTE: This is generally not applicable to
artificial or natural bodies of water in the
absence of some unusual condition or
artificial feature other than the mere water
and its location (Id).
c. Tolerated Possession
The owner is still liable if the plaintiff is inside
his property by tolerance or by implied
 permission (AQUINO, Torts and Damages,
supra at 173).
d. State of Necessity (CIVIL CODE, Art. 432)
A situation of present danger to legally
protected interests, where the only remedy is
injuring another’s also legally protected
interest (ALBERT, Justifying and Exempting
Circumstances under our Penal Code,
reprinted in AQUINO, Torts and Damages,
supra at 180).
For the defense of state of necessity to be
availing, the greater injury feared should not
have been brought about by the negligence
or imprudence, more so, the willful inaction of
the actor (Ty v. People, G.R. No. 149275,
September 27, 2004).
4. DUTIES OF PROPRIETORS OF
BUILDINGS
The proprietor of a building or structure is
responsible for the damages resulting from its
total or partial collapse, if it should be due to the
lack of necessary repairs (CIVIL CODE, Art.
2190).
Proprietors shall also be responsible for
damages caused: (EEFE)
a. By the Explosion of machinery which has not
been taken care of with due diligence, and
the inflammation of explosive substances
which have not been kept in a safe and
adequate place;
b. By Excessive smoke, which may be harmful
to persons or property;
c. By the Falling of trees situated at or near
highways or lanes, if not caused by force
majeure; and
d. By Emanations from tubes, canals, sewers or
deposits of infectious matter, constructed
without precautions suitable to the place
(CIVIL CODE, Art. 2191).
If damage referred to in the two preceding articles
should be the result of any defect in the
construction mentioned in Art. 1723, the third
person suffering damages may proceed only
against the engineer or architect or contractor in
accordance with said article, within the period
therein fixed (CIVIL CODE, Art. 2192).
Liabilities of the Engineer and Contractor
The engineer or architect, or the contractor, shall
be responsible for damages if the building which
they built shall, within fifteen (15) years from the
completion of the structure, collapse for reasons
attributable to their negligence.
If the engineer or architect supervises the
construction, he shall be solidarily liable with the
contractor (CIVIL CODE, Art. 1723 Par. 1).
NOTE: Acceptance of the building, after
completion, does not imply waiver of any of the
cause of action by reason of any defect
mentioned in the preceding paragraph. The
action must be brought within ten (10) years
following the collapse of the building (CIVIL
CODE, Art. 1723, Par. 2 & 3).
5. DUTIES OF EMPLOYERS AND
EMPLOYEES
Employers
In common law, employees can claim
compensation from their employers if the latter
committed tortious actions against them. Liability
may be due to the negligence of the employer in
the maintenance of the workplace. In such cases,
the employee will be saddled with the burden of
proving negligence on the part of the employer
(AQUINO, Torts and Damages, supra at 187).
Employees
An employee is liable for a tort when he neglects
to perform his duties properly to the damage of
the firm of which he was an officer. It is of no
moment that he occupied a contractual position
as the existence of contract between the parties
is not a bar to the commission of a tort and the
consequent recovery of damages (Araneta v. De
Joya, G.R. No. L-25172, May 24, 1974).
Employees are bound to exercise due care in the
performance of their functions for the employers.
Liability may be based on negligence committed
while in the performance of the duties of the
employee (AQUINO, Torts and Damages, supra
at 188).
6. DUTIES OF BANKS
Banking is a business that is impressed with
public interest (Philippine National Bank v.
Santos, G.R. No. 208293, December 10, 2014).
Banks are expected to exercise the highest
degree of diligence in the selection and
supervision of their employees, (Bank of the
Philippine Islands v. CA, G.R. No. 102383,
November 26, 1992) as well as in the conduct of
its affairs (Prudential Bank v. Rapanot, G.R. No.
191636, January 16, 2017).
7. DUTIES OF COMMON CARRIERS
Common carriers are required to exercise
extraordinary diligence in the vigilance over
their passengers and transported goods,
according to all the circumstances of each case
(CIVIL CODE, Art. 1733).
 A contract to transport passengers is different in
kind and degree from any other contractual
relation because of the relation which an air-
carrier sustains with the public. Its business is
mainly with the traveling public. It invites people
to avail of the comforts and advantages it offers.
The contract of air carriage generates a relation
attended with a public duty. Neglect or
malfeasance of the carrier's employees is a
ground for an action for damages (Air France v.
Carrascoso, G.R. No. L-21438, September 28,
1966).
An airline passenger was illegally ousted
from his first-class accommodation despite
his first-class ticket. He was compelled to
take a seat in a tourist compartment. Can the
airline be held liable for damages?
Yes, the wrongful expulsion of the passenger
was a breach of a public duty by the air carrier.
Although the relation between a passenger and a
carrier is contractual both in origin and nature, the
act that breaks a contract may also be a tort (Air
France v. Carrascoso, G.R. No. L-21438,
September 28, 1966).
8. DUTIES OF DOCTORS
Medical Malpractice
Is a particular form of negligence which consists
in the failure of a physician or surgeon to apply to
his practice of medicine that degree of care and
skill which is ordinarily employed by the
profession generally under similar conditions,
and in like surrounding circumstances (AQUINO,
Torts and Damages, supra at 196).
Circumstances Considered in Medical
Malpractice:
1.) Doctor-Patient Relationship
The physician-patient relationship is usually
a contractual relationship. However, there
may be cases when there is no contract
between the doctor and the patient (Id. at
191). No contract is implied to make
compensation for personal services
performed for another arises “unless the
party furnishing the services then expected
or had reason to expect the payment or
compensation by the other party” (Aldaba v.
CA, G.R. No. 21676, February 28, 1969).
The liability of the doctor in these cases is
based on culpa contractual.
The treatment of the patient may be a purely
voluntary act on the part of the doctor and the
patient may not be in a position to give his or
her consent. In these cases, the liability of the
doctor may be based on quasi-contract
(AQUINO, Torts and Damages, supra at
191).
2.) Elements of Medical Negligence: (D-BrIP)
a. Duty to use at least the same level of
care that any reasonably prudent doctor
would use to treat a condition under the
same circumstances;
b. Breach of such professional duty or
improper performance thereof;
c. Injury is caused to the patient,
constituting actionable malpractice; and
d. The doctor’s actions were the Proximate
cause of the patient’s injury (Li v.
Spouses Soliman, G.R. No. 165279,
June 7, 2011).
3.) Standard of Care:
a. General Practitioner
The standard of care demanded is
ordinary care and diligence in the
application of his knowledge and skill in
his practice of the profession. He ought
to apply to his patient what other general
practitioners will apply when confronted
with similar situation (AQUINO, Torts
and Damages, supra at 199).
b. Specialist
The legal duty to the patient is generally
considered to be that of an average
specialist, not that of an average
physician. A physician who holds himself
out as having special knowledge and skill
in the treatment of a particular organ or
disease or injury is required to bring to
the discharge of his duty that special
degree of skill and care which
physicians, similarly situated who devote
special study and attention to the
treatment of such organ, disease, or
injury ordinarily possess, regard being in
the state of scientific knowledge at that
time (Id.).
c. National Standards
Each physician may with reason and
fairness be expected to possess or have
reasonable access to such medical
knowledge as is commonly possessed or
reasonable available to competent
physicians in the same specialty or
general field of practice in the Philippines
(Id. at 200).
REASON: Nationalization of medical
education and training. Common sense
and experience inform us that the laws of
medicine do not vary from state to state
 in anything like the manner our public law
does (Id.).
d. Locality Rule
The doctor must be aware of the
specialized services or facilities available
in his area. Hence, to a certain extent,
local medical custom and the facilities in
the community may affect the duty of
care of doctors but only in the sense that
the content of the duty of care may be
informed by local medical custom but
never subsumed by it (Id. at 201).
e. Neighborhood Rule
In treating his patient, a physician is
under a duty to the patient to exercise
that degree of care, skill, and diligence
which physicians in the same general
neighborhood and in the same general
line of practice ordinarily possess and
exercises in like cases (Lucas v. Tuano,
G.R. No. 171636, April 7, 2009).
One has to ask whether, as between the
alleged wrongdoer and the person who
has suffered damage there is sufficient
relationship of proximity or neighborhood
such that, in the reasonable
contemplation of the former,
carelessness on his part may be likely to
cause damage to the latter, in which
case a prima facie duty arises (AQUINO,
Torts and Damages, supra at 202).
Two-Pronged Evidence:
a. Evidence as to the recognized
standards of the medical community
in the particular kind of case; and
b. A showing that the physician
negligently departed from this
standard in his treatment (Garcia-
Rueda v. Pascasio, G.R. No.
118141, September 5, 1997 citing
Davis v. Virginian Railway Company,
361 US 354).
4. Doctors Are Not Warrantors of Cure
Physicians are not warrantors of cures or
insurers against personal injuries or death of
the patient (Cruz v. CA, G.R. No. 122425,
November 18, 1997). The mere fact that the
patient does not get well or that a bad result
occurs does not in itself indicate failure to
exercise due care (Lucas v. Tuano, G.R. No.
178763, April 21, 2009).
5. Error of Judgement
Whether an error of judgement is negligent or
not depends on the nature of the error
(AQUINO, Torts and Damages, supra at
206).
In determining whether error of judgement is
negligent, the Supreme Court explained in
Casumpang v. Cortejo, that:
a. We do not decide the correctness of a
doctor’s diagnosis, or the accuracy of the
medical findings and treatment. Our duty
in medical malpractice cases is to decide
whether a breach of duty took place;
b. A wrong diagnosis is not by itself medical
malpractice; it becomes an evidence of
medical malpractice;
c. Medicine is not exact science; and
doctors or even specialists, are not
expected to give a 100% accurate
diagnosis in treating patients who come
to their clinic for consultations (G.R. No.
171127, March 11, 2015).
6. Expert Witness
It is a matter of expert opinion whether a
physician or a surgeon has exercised the
requisite degree of skill and care in the
treatment of his patient (Cruz v. CA, G.R. No.
122445, November 18, 1997).
Courts defer to the expert opinion of qualified
physicians because the court’s realization
that the qualified physicians possess unusual
technical skills which laymen in most
instances are incapable of intelligently
evaluating (AQUINO, Torts and Damages,
supra at 208).
Requisites to qualify as Expert Witness:
a. Has the required professional
knowledge, learning and skill of the
subject matter under inquiry sufficient to
qualify him to speak with authority on the
subject; and
b. Is familiar with the standard required of a
physician under similar circumstances
(Casumpang v. Cortejo, G.R. No.
171127, March 11, 2015)
Expert Witness Must Establish:
a. The standard of care that the defendant
was bound to observe under the
circumstances;
b. That the defendant’s conduct fell below
the acceptable standard; and
c. That the defendant’s failure to observe
the industry standard caused the injury to
his patient (Borromeo v. Family Care
Hospital, G.R. No. 191018, January 25,
2016).
7. Res ipsa loquitur applied:
a. In medical negligence, res ipsa loquitur
allows the mere existence of an injury to
justify a presumption of negligence on
the part of the person who controls the
instrument causing the injury (Cantre v.
Sps. Go, G.R. No. 160889, April 27,
2007).
b. Medical malpractice can be established
by res ipsa loquitur. It is limited to cases
where the court, from its common
knowledge, can determine the standard
of care or where an ordinary layman can
conclude that there was negligence on
the part of the doctor (Solidum v. People,
G.R. No. 192123, March 10, 2014).
c. Although generally, expert medical
testimony is relied upon in malpractice
suits to prove that a physician has done
a negligent act or that he has deviated
from the standard medical procedure,
when the doctrine of res ipsa loquitur is
availed by the plaintiff, the need for
expert medical testimony is dispensed
with because the injury itself provides the
proof of negligence. The doctrine is not
available in a malpractice suit if the only
showing is that the desired result of an
operation or treatment was not
accomplished (Solidum v. People, G.R.
No. 192123, March 10, 2014).
In the case of Borromeo v. Family Care
Hospital, Inc. the Supreme Court explained
that this doctrine of res ipsa loquitur is used
in conjunction with the doctrine of common
knowledge. Such doctrine has been applied
in the following cases involving medical
practitioners:
a. Where a patient who was scheduled for
a cholecystectomy (removal of gall
stones) but was otherwise healthy
suffered irreparable brain damage after
being administered anesthesia prior to
the operation;
b. Where after giving birth, a woman woke
up with a gaping burn wound close to her
left armpit;
c. The removal of the wrong body part
during the operation; and,
d. Where an operating surgeon left a
foreign object (i.e., rubber gloves) inside
the body of the patient (G.R. No. 191018,
January 25, 2016; AQUINO Torts and
Damages, at 218).
8. Lost Chance Rule
When a plaintiff prays for damages for lost
chance, the essence of the plaintiff’s claim is
that prior to negligence, there was a chance
that he would have been better off with
adequate care. Because of the negligence,
this chance has been lost. Loss of chance is
the lost opportunity for better result (Id, at
219).
9. Doctrine of Informed Consent
Unless excused, the doctor must secure the
consent of his patient, express or implied, to
a particular treatment or an investigative
procedure (Id.).
Elements essential in a malpractice
action based on the doctrine of informed
consent: (DFCI)
a. The physician has a Duty to disclose the
material risks;
b. The physician Failed to disclose or
inadequately disclosed the risks;
c. As a direct and proximate result of the
failure to disclose, the patient Consented
to treatment she otherwise would not
have consented to; and
d. The plaintiff was Injured by the proposed
treatment (Li v. Spouses Soliman, G.R.
No. 165279, June 7, 2011).
Cases When There Is No Duty to Disclose
(ETUT)
a. Emergency situations;
b. Time is of the essence;
c. Where the patient is Unconscious or
otherwise incapable of consenting and
harm from failure to treat is imminent and
outweighs any harm threatened by the
proposed treatment; and
d. Use of Therapeutic privilege. For
instance, on some occasions a candid
and thorough disclosure of information
will have an adverse effect on the
patient’s condition or health (AQUINO,
Torts and Damages, supra at 224).
The physician is not required to give the
patient a short medical education, the
disclosure rule only requires of him a
reasonable explanation, which mean
generally informing the patient in
nontechnical terms as to what is at stake; the
therapy alternatives open to him, the goals
expectably to be achieved, and the risks that
may ensue from particular treatment or no
treatment (Li v. Spouses Soliman, supra).
NOTE: In the case of Li v. Spouses Soliman,
The Separate Opinion of Justice Brion
presents two standards:
1. Professional Disclosure Standard
A charge of failure to disclose should be
judged by the standards of the
 reasonable medical practitioner.
2. Reasonableness Patient Standard
The test for determining whether a
particular peril must be divulged is its
materiality to the patient’s decision: all
risks potentially affecting the decision
must be unmasked.
10. Captain of the Ship Doctrine
The operating surgeon is the person in
complete charge of the surgery room and all
personnel connected with the operation.
Their duty is to obey his orders (Professional
Services, Inc. v. Agana, G.R. No. 126297,
January 31, 2007).
Liability of Hospitals
When There is Employer-Employee
Relationship Between the Hospital and the
Physician
Where employment relationship exists, the
hospital may be held vicariously liable under
Article 2176 in relation to Article 2180 of the Civil
Code or the principle of respondeat
superior (Professional Services, Inc., v. CA, G.R.
No. 126297, February 2, 2010).
When There is No Employer-Employee
Relationship Between the Hospital and the
Physician
When no employment relationship exists but it is
shown that the hospital holds out to the patient
that the doctor is its agent, the hospital may be
vicariously liable under Art. 2176 in relation to Art.
1431 and Art. 1869 of the Civil Code or the
principle of apparent authority (Professional
Services, Inc., v. CA, G.R. No. 126297, February
2, 2010).
NOTE: In assessing whether such employer-
employee relationship in fact exists, the control
test is determining (Id.) In this regard, the SC,
explained that:
“The control test essentially determines
whether an employment relationship exists
between a physician and a hospital based
on the exercise of control over the
physician as to details. Specifically, the
employer (or the hospital) must have the
right to control both the means and the
details of the process by which the employee
(or the physician) is to accomplish his task.”
(Nogales v. Capitol Medical Center G.R. No.
142625, December 19, 2006).
Doctrine of Corporate Responsibility/
Corporate Negligence
Regardless of the hospital’s relationship with the
doctor, it may be held directly liable to the patient
for its own negligence or failure to follow
established standard of conduct to which it
should conform as a corporation (Professional
Services, Inc., v. CA, G.R. No. 126297, February
2, 2010).
The corporate negligence doctrine imposes
several duties on a hospital:
1. To use reasonable care in the maintenance
of safe and adequate facilities and
equipment;
2. To select and retain only competent
physicians;
3. To oversee as to patient care all persons who
practice medicine within its walls;
4. To formulate, adopt, and enforce adequate
rules and policies to ensure quality care for
its patients (Professional Services, Inc. v.
CA, G.R. No. 126297, January 31, 2007).
9. DRUGGISTS/DRUGSTORE BUSINESS
In the purchase and sale of drugs, the buyer and
seller do not stand at arm’s length. There exists
an imperative duty on the seller or the druggist to
take precautions to prevent death or injury to any
person who relies on one’s absolute honesty and
peculiar learning (Mercury Drug Corporation v.
De Leon, G.R. No. 165622, October 17, 2008).
In Mercury Drug Corporation v. Baking, Baking
was given a potent sleeping tablet, instead of
medicines to stabilize his blood sugar. On the
third day of taking the wrong medicine, Baking
figured in a vehicular accident. He fell asleep
while driving. The proximate cause of the
accident was the gross negligence of the
pharmacist who gave the wrong medicine to
Baking (Id.).
10. DUTIES OF LAWYERS
An attorney is bound to exercise only a
reasonable degree of care and skill, having
reference to the business he undertakes to do
(Adarne v. Aldaba, A.C. No. 801, June 27 1978).
NOTE: The lawyer’s liability may not be based
solely on that fact that his client lost the case
(AQUINO, Torts and Damages, supra at 254).
11. DUTIES OF EXPERTS
An expert should exhibit the care and skill of one
ordinarily skilled in the particular field that he is in
(Culion Ice, Fish & Electric Co v. Philippine
Motors, G.R. No. 32611, November 3, 1930).
 DEFENSES
DOCTRINE OF CONTRIBUTORY
NEGLIGENCE
If the negligence of the plaintiff cooperated with the
negligence of the defendant in bringing about the
accident causing the injury complained of, such
negligence of the plaintiff would be an absolute bar to
recovery. If the negligence of the plaintiff was merely
contributory to his injury, the immediate and
proximate cause of the accident causing the injury
being the defendant's negligence, such negligence
would not be a bar to recovery, but the amount
recoverable shall be mitigated by the court (Phoenix
Construction v. IAC, G.R. No. L-65295, March 10,
1987).
Contributory negligence is conduct on the part of the
injured party, contributing as a legal cause to the
harm he has suffered, which falls below the standard
to which he is required to conform for his own
protection (Spouses Vergara v. Spouses Sonkin,
G.R. No. 193659, June 15, 2015).
There is contributory negligence when the party's act
showed lack of ordinary care and foresight that such
act could cause him harm or put his life in danger
(Estacion v. Bernardo, G.R. No. 144723, February
27, 2006).
A collecting bank is guilty of contributory negligence
when it accepted for deposit a post-dated check
notwithstanding that said check had been cleared by
the drawee bank which failed to return the check
within the 24-hour reglementary period (Allied
Banking Corporation v. Bank of the Philippine
Islands, G.R. No. 188363, February 27, 2013).
The underlying precept on contributory negligence is
that a plaintiff who is partly responsible for his own
injury should not be entitled to recover damages in
full but must bear the consequences of his own
negligence. The defendant must therefore be held
liable only for the damages actually caused by his
negligence (Spouses Vergara v. Spouses Sonkin,
supra).
In Ma-ao Sugar Central Co., Inc. v. CA, the Court
ruled that the petitioner company cannot excuse itself
from its failure to properly maintain the wires by
attributing negligence to the victim. The responsibility
of maintaining the rails for the purpose of preventing
derailment accidents belonged to the company. The
company should not have been negligent in
ascertaining that the rails were fully connected than
to wait until a life was lost due to an accident (G.R.
No. 83491, August 27, 1990).
The defense of contributory negligence does not
apply in criminal cases committed through reckless
imprudence, since one cannot allege the negligence
of another to evade the effects of his own negligence
(Manzanares v. People, G.R. Nos. 153760-61,
October 12, 2006).
The defendant may still be held liable for damages
even if the act was meant to be a practical joke
(AQUINO, Torts and Damages, supra at 61).
As far as the act which caused the injury was
concerned, it was an innocent prank not unusual
among children at play and which no parent, however
careful, would have any special reason to anticipate
much less guard against (Cuadra v. Monfort, G.R.
No. L-24101, September 30, 1970).
DOCTRINE OF COMPARATIVE
NEGLIGENCE
The relative degree of negligence of the parties is
considered in determining whether, and to what
degree, either should be responsible for his
negligence (apportionment of damages) (AQUINO,
Torts and Damages, supra at 290).
The rules involve apportionment of damages. Under
the “pure” type of comparative negligence, the
plaintiff’s contributory negligence does not operate to
bar his recovery altogether but does serve to reduce
his damage in proportion to his fault (Id. at 266-267).
IMPUTED CONTRIBUTORY
NEGLIGENCE
Negligence is imputed if the actor is different from the
person who is being made liable (Id. at 301).
Since a master may be held for his servant’s wrongful
act, the law imputes to the master the act of the
servant, and if that act is negligent or wrongful and
proximately results in injury to a third person, the
negligence or wrongful conduct is the negligence or
wrongful conduct of the master, for which he is liable
(Phil. Commercial International Bank v. CA, G.R. No.
121413, January 29, 2001).
Effect: The defendant will be subject to mitigated
liability even if the plaintiff was not himself personally
negligent because the negligence of another is
imputed to the plaintiff (REYES AND PUNO, Outline
of the Phil. Civil Law, Vol. 6, p. 169) [hereinafter, 6
REYES AND PUNO]).
Applicability: If the negligence was on the part of the
person for whom the plaintiff is responsible, and
especially, by negligence of an associate in the
transaction where he was injured (Id.).
VIOLATION OF STATUTE BY THE VICTIM
It is treated generally as negligence per se, except
when the law or rules specifically provide for a
different rule. The effect would depend on whether
the violation is:
1. Merely contributory negligence – partial defense;
2. The proximate cause of the loss – complete
defense; or
3. Neither contributory nor the proximate cause of
the loss – proof of causation required (AQUINO,
Torts and Damages, supra at 304).
NOTE: Contributory negligence is conduct on the part
of the injured party, contributing as a legal cause to
the harm he has suffered, which falls below the
standard to which he is required to conform for his
own protection. To hold a person as having
contributed to his injuries, it must be shown that he
performed an act that brought about his injuries in
disregard of warning or signs of an impending danger
to health and body. To prove contributory negligence,
it is still necessary to establish a causal link, although
not proximate, between the negligence of the party
and the succeeding injury. In a legal sense,
negligence is contributory only when it contributes
proximately to the injury, and not simply a condition
for its occurrence (Dela Cruz v. Octaviano, G.R. No.
219649, July 26, 2017).
FORTUITOUS EVENT (CASO FORTUITO)
An event which could not be foreseen, or which
though foreseen, was inevitable (CIVIL CODE, Art.
1174).
GENERAL RULE: It is a complete defense and a
person is not liable if the cause of the damage was a
fortuitous event (CIVIL CODE, Art. 1174).
EXCEPTION:
Partial Defense
If the fortuitous event is not the sole cause of the
injury and the courts may mitigate the damage if the
loss would have resulted in any event (CIVIL CODE,
Art. 2215).
ESSENTIAL CHARACTERISTICS: (COFI)
1. The Cause of the unforeseen and unexpected
occurrence, or of the failure of the debtor to
comply with his obligation, must be independent
of the human will;
2. The occurrence must be such as to render it
impossible for the debtor to fulfill his Obligation in
a normal manner;
3. The obligor must be Free from any participation
in the aggravation of the injury resulting to the
creditor; and
4. It must be Impossible to foresee the event which
constitutes the caso fortuito or if it can be
foreseen, it must be impossible to avoid
(Spouses Cruz v. Sun Holidays, Inc., G.R. No.
186312, June 29, 2010).
ACTS OF GOD – Events which are totally
independent of the will of every human being (e.g.,
earthquake, lightning, eruption of volcano) (DE
LEON, Obligations and Contracts, supra at 71).
ACTS OF MAN – Events which are independent of
the will of the obligor but not of other human wills e.g.,
war, fire, robbery, insurrection (Id.).
For a person to be exempted from liability due to
fortuitous event, the latter must be the proximate and
only cause of the loss or damage. The act must be
one occasioned exclusively by the violence of nature
and human agencies are to be excluded from
creating or entering into the cause of the mischief
(ALBANO, Torts and Damages supra at 52).
NOTE: A fortuitous event may either be an act of
God, or natural occurrences such as floods or
typhoons, or an act of man such as riots, strikes or
wars. However, when the loss is found to be partly
the result of a person's participation — whether by
active intervention, neglect or failure to act — the
whole occurrence is humanized and removed from
the rules applicable to a fortuitous event (Asset
Privatization Trust v. T.J. Enterprises, G.R. No.
167195, May 8, 2009).
Fire is not a natural calamity as it arises almost
invariably from some act of man or by human means.
It does not fall within the so-called “Acts of God,”
except when caused by lightning (Eastern Shipping
Lines, Inc. v. IAC, G.R. No. L-69044, May 29, 1987).
This Court will no longer delve on the issue of
whether or not the fire which caused the loss of
and/or damage to respondent's personal effects is a
fortuitous event since both the trial court and the
Court of Appeals correctly ruled that the fire which
occurred in this case cannot be considered an act of
God since the same was not caused by lightning or a
natural disaster or other calamity not attributable to
human agency (International Container Terminal
Services, Inc. v. Chua, G.R. No. 195031, March 26,
2014).
ACCIDENT
An accident pertains to an unforeseen event in which
no fault or negligence attaches to the defendant. It is
"a fortuitous circumstance, event or happening; an
event happening without any human agency, or if
happening wholly or partly through human agency, an
event which under the circumstances is unusual or
unexpected by the person to whom it happens” (Jarco
Marketing Corporation v. CA, G.R. No. 129792,
December 21, 1999).
DOCTRINE OF ASSUMPTION OF RISK
A plaintiff who voluntarily assumes a risk of harm
arising from the negligent or reckless conduct of the
defendant cannot recover for such harm (SANGCO,
Torts and Damages, supra at 170).
Elements: (KUF)
1. The plaintiff must Know that the risk is present;
2. He must Understand its nature; and
3. His choice to incur it is Free and voluntary
(AQUINO, Torts and Damages, supra at 306).
EXCEPTIONS:
The plaintiff is free from liability if:
1. An emergency is found to exist; or
2. The life or property of another is in peril when he
seeks to rescue his endangered property (Ilocos
Norte Electric Co. v. CA, G.R. No. L-53401,
November 6, 1989).
VOLENTI NON FIT INJURIA
“That which a person assents are not esteemed in
law as injury.” One is not legally injured if he has
consented to the act complained of or was willing that
it should occur. When the defense of assumption of
risk is based on this maxim, it negates negligence or
liability on the part of the defendant, even though his
conduct would otherwise have constituted actionable
negligence, and without regard to the fact that the
plaintiff may have acted in due care (SANGCO, Torts
and Damages, supra at 172).
Illustration: Petitioner’s discontinuance from
teaching was her own choice. While the respondents
admittedly wanted her service terminated, they
actually did nothing to physically prevent her from
reassuming her post, as ordered by the school’s
Board of Directors. That the school principal and Fr.
Wiertz disagreed with the Board’s decision to retain
her, and some teachers allegedly threatened to
resign en masse, even if true, did not make them
liable to her for damages. They were simply
exercising their right of free speech or their right
to dissent from the Board’s decision. Their acts
were not contrary to law, morals, good customs
or public policy. They did not “illegally dismiss” her
for the Board’s decision to retain her prevailed. She
was ordered to report for work on July 5, 1982, but
she did not comply with that order. Consequently,
whatever loss she may have incurred in the form of
lost earnings was self-inflicted (Garciano v. CA, G.R.
No. 96126, August 10, 1992).
It does NOT apply:
Where one person created a danger and another
person, with knowledge and appreciation of its
existence, voluntarily assumes the risk of such
danger but is not injured by it even though he is
injured in some other way in attempting to withdraw
from the scene after the degree of danger increases,
the defense of assumption of risk cannot be made
available (SANGCO, Torts and Damages, supra at
171).
The defense of assumption of risk is not available to
the employer in cases covered by the Workmen's
Compensation Act. Here, the burden of risk of
industrial accidents has been transferred by the law
from the employee to the employer. Under the said
act, the employer is liable for damages or
compensation to the employee for any injuries which
the employee may suffer from any accidents arising
out of and in the course of his employment or other
illness directly caused by such employment
(PINEDA, Torts and Damages, supra at 74).
KINDS:
1. Express Waiver of the Right to Recover
(CIVIL CODE, Art. 6)
There is assumption of risk if the plaintiff in
advance has expressly waived his right to
recover damages for the negligent act of the
defendant (AQUINO, Torts and Damages, supra
at 308).
Effects of Waiver to Recover Before/After
Negligent Act:
a. Before – invalid as it is prohibited.
b. After – valid; condonation of obligation (Id.).
2. Implied Assumptions
a. Dangerous Conditions – A person who,
knowing that he is exposed to a dangerous
condition and, voluntarily assumes it may not
recover from the defendant who maintained
such dangerous conditions (Id. at 311).
Kinds of Dangerous Conditions:
i. Those which are inherently dangerous.
ii. Those where a person places a thing
which is not dangerous in itself, in a
dangerous position.
iii. Those involving products and other
things which are dangerous because
they are defective.
Illustrations:
i. A house placed near a railroad track
assumes the usual dangers attendant to
the operation of a locomotive.
ii. Spectators at sports event, customers at
amusement parks, and guest who find
dangerous conditions when they enter
business premises (Id. at 283-284).
b. Contractual Relations – There may be
implied assumption of risk if the plaintiff
entered into a contractual relation with the
defendant (Id.).

Illustrations:
i. The employees assume the ordinary
risks inherent in the industry in which he
is employed (Id. at 289).
In abnormal risks arising from unusual
conditions, it is a question of fact and
there must be cogent and convincing
evidence of such consent (Id.).
ii. When a passenger boards a common
carrier, he takes the risks incidental to
the mode of travel he has taken (Yobido
v. CA, G.R. No. 113003, October 17,
1997).
iii. In case the plaintiff was employed by the
defendants as caretaker of their
carabaos, he was gored to death by one
of these carabaos. The Court held that it
was the caretaker’s business to try to
prevent the animal from causing injury or
damage to anyone, including himself.
Being injured by the said animal was one
of the risks of the occupation, which he
had voluntarily assumed and for which
he must take the consequences (Afialda
v. Hisole, G.R. No. L-2075, November
29, 1949).
c. Employment – Based on the implied
consent of the servant to accept or continue
in the employment after becoming aware of
the risk which resulted in his injury (AQUINO,
Torts and Damages, supra at 312).
Exception: An employee cannot be said to
have assumed a risk which is not incident to
his employment (Id.).
d. Joining Sports Events – Where a person
voluntarily participates in a lawful fame or
contest, he assumes the ordinary risks of
such game or contest so as to preclude
recovery from the promoter or operator of the
game or contest for injury or death resulting
therefrom (Abrogar v. Cosmos Bottling Co.,
G.R. No. 164746, March 15, 2017).
e. Defendant’s Negligence – When the
plaintiff is aware of the risk created by the
defendant’s negligence, but he voluntarily
decided to proceed to encounter it, there is
an implied admission e.g., Plaintiff assumes
risk of using unsafe product if he knew it to
be unsafe (Id. supra at 314).
PRESCRIPTION
An action based on quasi-delict prescribes in four (4)
years from the date of the accident (CIVIL CODE, Art.
1146) – to be counted from the last element of the
commission of an act or omission violative of the right
of the plaintiff.
RELATIONS BACK DOCTRINE
An act done at one time is considered by fiction of law
to have been done at some antecedent period (Allied
Banking Corp v. CA, G.R. No. L-85868, October 13,
1989). The prescriptive period should commence to
run only upon discovery of the injury (AQUINO, Torts
and Damages, supra at 326).
Illustration: A doctor negligently transfused blood to
a patient that was contaminated with HIV. If the effect
became apparent only after five (5) years, the 4-year
prescriptive period should commence only when it
was discovered (Id. at 327).
INVOLUNTARINESS
It is a complete defense in quasi-delict cases and the
defendant is therefore not liable if force was exerted
on him (Id. at 328).
Illustration: When the defendant was forced to drive
his vehicle by armed men who were escaping from
the policemen, the defendant cannot be held liable if
a bystander is hit as a consequence (Id.).
Persons using violence or causing fear are primarily
liable for acts committed by third persons acting
under irresistible force or uncontrollable fear. If there
be no such persons, those doing the act shall be
liable secondarily (REVISED PENAL CODE, Art.
101).
STATE OF MOST SIGNIFICANT
RELATIONSHIP RULE
Where a tort is committed entirely or partly in another
country. The tort case may be dismissed of the
Philippines is not the State which has the most
significant relationship (Saudi Arabian Airlines v. CA,
G.R. No. 122191, October 8, 1998).
What is important here is the place where the over-all
harm or the totality of the alleged injury to the person,
reputation, social standing and human rights of
complainant, had lodged, according to the plaintiff
(Id.).
THE TORTFEASOR
TORTFEASOR
Every person legally responsible is liable for a tort
committed by him provided it is the proximate cause
of an injury to another (DE LEON, Torts and Persons
Damages, supra at 16). Persons For Whose Nature
Vicariously Acts of Defenses
PERSONS WHO CAN SUE AND BE SUED Liable Liability Is Liability
FOR TORT: Imputed

1. Plaintiff NOTE: Article of a good

– natural or artificial persons injured by a tortious 221 of the father of a
act; can sue the tortfeasor and are entitled to Family code family to
damages (AQUINO, Torts and Damages, supra removes the prevent
at 29). alternative damage.
qualification
between
Except in cases where an injury to one person father and
operates as an injury to another, e.g., damages mother.
sustained by a parent arising from the injury
suffered by his/her child, an action for damages Guardians Minors or Direct and 1)Exercise
can only be maintained by the person directly (Art. 2180, incapacitate Primary of diligence
injured, and not by one alleging a collateral injury NCC) d persons of a good
(DE LEON, Torts and Damages, supra at 16). who are father of a
under their family to
authority and prevent
2. Defendant live in their damage.
– natural/artificial persons who may be held liable company
(Id. at 32).
School, A child who Direct, 1) The
DIRECT TORTFEASOR Administrators is: Principall activity is
, Teachers, (i) a Minor; y and not an
As a general rule, all persons or entities are liable for and Individual, (ii) under Solidary authorized
torts committed by them, or by their agents while Entity or their Liable activity;
acting within the scope of their duties (DE LEON, Institution supervision, (2012
Torts and Damages, supra at 16). Defendants in tort Engaged in instruction or Bar). 2) The child
cases can either be natural or artificial beings Child Care custody; is not under
(AQUINO, Torts and Damages, supra at 32). (Art. 218, (iii) overNOTE: their
Family Code) which they The supervision
exercise parents, ,
PERSONS MADE RESPONSIBLE FOR special guardians instruction,
OTHERS parental , or or custody;
The obligation imposed by Article 2176 of the Civil authority persons
(2005 Bar) exercising 3) Exercise
Code on quasi-delicts is demandable not only for
substitute of due
one’s own acts or omissions, but also for those of NOTE: The parental diligence.
persons for whom one is responsible (CIVIL CODE, responsibilit authority
Art. 2180). y applies to are
authorized subsidiary
The basis of liability is pater familias or the failure of activities liable.
the persons mentioned therein to exercise due care inside or
and vigilance over the acts of subordinates to prevent outside the
the damage (Filcar Transport Services v. Espinas, school.
G.R. No. 174156; June 20, 2012). Teachers or Pupils, Direct, 1) The
Heads of students, or Primary, student is
PERSONS VICARIOUSLY LIABLE Establishment apprentices and not in their
of Arts and so long as Solidary custody;
Persons
Trade they remain
Persons For Whose Nature
(Art. 2180, in custody – 2) Exercise
Vicariously Acts of Defenses
NCC) if they are no of due
Liable Liability Is Liability
longer diligence.
Imputed
NOTE: minors.
Schools and
Parents Acts of their Direct and 1) The child
Administrators (For minor
(Art. 2180, children up Primary is not living
are NOT children,
NCC, and to 21 years in their
liable. apply Arts.
Arts. 221 and of who live in company.
218 and 219
236 Family their
of the Family
Code) company 2) Exercise
Code)
(2005 Bar) of diligence
 Persons b. Court-appointed guardians (CIVIL CODE, Art
Persons For Whose Nature 2182).
Vicariously Acts of Defenses
Liable Liability Is Liability 3. Those exercising Substitute parental authority
Imputed a. Surviving grandparents (FAMILY CODE, Art.
214);
Employers Employees Direct, 1) The b. Oldest sibling, over 21 years old unless unfit
(Art. 2180, and Primary, employee or disqualified (FAMILY CODE, Art. 216, par.
NCC) household and is not
helpers – in Solidary performing
2); or
NOTE: It is the service with his c. Child’s actual custodian, over 21 years old
NOT or, on employee functions or unless unfit or disqualified (FAMILY CODE,
necessary that occasion of (1997 is acting Art. 216, par. 3);
they are their Bar) beyond the
engaged in functions or scope of Liability: Subsidiary
any business the scope of his REASON: They do not have the direct custody of
or industry their task. function; the child.
(2005 Bar)
2) Exercise
of due
4. Those exercising Special parental authority:
diligence in (SATI)
the a. School;
selection or b. Administrators;
supervision c. Teachers; or
of the d. Individual, entity or institution engaged in
employee child care (FAMILY CODE, Art. 218).
(1992,
1997, and
2003 Bar) PARENTS
The father and mother are civilly liable for any
The State Special Direct and 1) The damages that may be caused by the minor children
(Art. 2180, Agents Primary persons who live in their company. The provision with respect
NCC) - one who who to parents in the second paragraph of Article 2180 of
receives a directly
the Civil Code is modified by Article 221 of the Family
fixed order, caused the
foreign to the loss is not a Code by removing the alternative qualification of the
exercise of special liability of the father and the mother.
the duties of agent – the
the official official was REASON: The liability is a necessary consequence
performing of the parental authority they exercise over them.
the task (AQUINO, Torts and Damages, supra at 658).
that
properly To sustain the liability of the father or the mother
pertains to
in proper cases, it is necessary that: (BTL)
him.
1. The child is Below twenty-one (21) years;
A Head of Subordinate Direct and 1) He did Except: Deep Pocket Theory
Department of s that he has Primary not give a 2. The child committed a Tortious act to the damage
Government authorized written and prejudice of another person; and
or Superior by written order. 3. The child Lives in the company of the parent
Public Officer. order the concerned (Libi v. IAC, G.R. No. 70890,
(Sec. 38, specific act September 18, 1992).
Revised or
Administrative misconduct.
Code of 1987)
Under Article 221 of the Family Code, parents are
principally and primarily liable for acts or omissions of
their minor children resulting in injuries to others.
PERSONS LIABLE FOR ACTS However, for liability on the part of the parents to
COMMITTED BY MINORS: (POSS) attach, the minor child must be living in their company
1. Parents; (CIVIL CODE, Art. 2180, Par. 2) and under their parental authority (Libi v. IAC, G.R.
No. 70890, September 18, 1992).
2. Those exercising parental authority Other than
parents
a. Adopters; or
PERSONS EXERCISING PARENTAL
AUTHORITY OTHER THAN PARENTS:
1. Adopters
The Court does not consider that retroactive
effect may be given to the decree of adoption so
as to impose a liability upon the adopting parents
(Tamargo v. CA, G.R. No. 85044, June 3, 1992).
2. Guardians
They are liable for damages caused by minors or
incapacitated persons (even if they are already of
age) under their authority and living in their
company.
The legal authority referred to in Article 2180 is
legal authority over the person of the ward and
not legal authority only with respect to the
property of a person declared as incompetent
although of majority age (AQUINO, Torts and
Damages, supra at 674).
EXTENT OF SPECIAL PARENTAL
AUTHORITY
It can be exercised only over minors while under their
supervision, instruction or custody, including while in
authorized activities whether inside or outside the
school, entity or institution (Id.).
Custody – the protective and supervisory custody
that the school and its head and teachers exercise
over the pupils and students for as long as they are
in attendance in the school, including recess time
(Salvosa v. Intermediate Appellate Court, G.R. No.
70458, October 5, 1988).
As long as it can be shown that the student is in the
school premises in pursuance of a legitimate student
objective, in the exercise of a legitimate right, and
even in the enjoyment of a legitimate student
privilege, the responsibility of the school authorities
over the student continues (Amadora v. CA, G.R. No.
L-47745, April 15, 1988).
Liability: They are principally and solidarily liable for
damages caused by the acts or omissions of the
minor (FAMILY CODE, Art. 219).
LIABILITY FOR ACTS OF THOSE NO
LONGER MINORS
DEEP POCKET THEORY
Young Filipinos aged 18-21 are usually not yet
gainfully employed and without property. The law
allows the injured party to pursue actions against the
tortfeasor’s parents (AQUINO, Torts and Damages,
supra, at 662).
OWNERS AND MANAGERS OF
ESTABLISHMENTS
They are liable for damages caused by their
employees in the service of the branches in which
they are employed, or on the occasion of their
functions. It does not extend to acts of strangers who
committed unauthorized acts and in doing so, caused
damages to others (CIVIL CODE, Art. 2180 Par. 4.).
“Manager” in Art. 2180 is used in the sense of an
employer. A managerial employee within the
contemplation of the Labor Code is not a manager
referred to in Art. 2180 because he himself may be
regarded as an employee or dependiente of the
employer (Philippine Rabbit Bus Lines, Inc. v. Phil.
American Forwarders, Inc., GR No. L-25142, March
25, 1975).
Co-employees are not liable even if they supervise
the employee (AQUINO, Torts and Damages, supra
at 691).
EMPLOYERS
Liable for damages caused by their employees and
household helpers acting within the scope of their
assigned tasks even though the employer is not
engaged in any business or industry (CIVIL CODE,
Article 2180 Par. 5).
Although the employer is not the actual tortfeasor, the
law makes him vicariously liable on the basis of the
civil law principle of pater familias for failure to
exercise due care and vigilance over the acts of one’s
subordinates to prevent damage to another (Filcar
Transport Services v. Jose Espinas, G.R. No.
174156, June 20, 2012).
Requisites of Employer’s Vicarious Liability
Under Article 2180 of the Civil Code:
a. There is employer-employee relationship; and
b. That the employee was acting within the scope of
his assigned task when the tort complained of
was committed (Caravan Travel and Tours
International, Inc. v. Abejar, G.R. No. 179631,
February 10, 2016).
DEFENSE OF EMPLOYER
When the employee causes damage due to his own
negligence while performing his own duties, there
arises the juris tantum presumption that the employer
is negligent, rebuttable only by proof of observance
of the diligence of a good father of a family.
To rebut the presumption of negligence, employer
must prove two things:
1) That it had exercised due diligence in the
selection of employees (culpa in eligiendo); and
2) That after hiring employees, employer had
exercised due diligence in supervising them
(culpa vigilando).
In order that the owner of a vehicle may be
considered as having exercised all diligence of a
good father of a family, he should not have been
satisfied with the mere possession of a professional
driver's license; he should have carefully examined
the applicant for employment as to his qualifications,
his experience and record of service.
Due diligence in the supervision of employees, on the
other hand, includes the formulation of suitable rules
and regulations for the guidance of employees and
the issuance of proper instructions intended for the
protection of the public and persons with whom the
employer has relations through his or its employees
and the imposition of necessary disciplinary
measures upon employees in case of breach or as
may be warranted to ensure the performance of acts
indispensable to the business of and beneficial to
their employer. Actual implementation and monitoring
of consistent compliance with said rules should be the
constant concern of the employer, acting through
dependable supervisors who should regularly report
on their supervisory functions (Reyes v. Doctolero,
G.R. No. 185597, August 2, 2017).
RULE IN CASES INVOLVING CRIMINAL
NEGLIGENCE
Article 103 of the Revised Penal Code governs the
subsidiary liability of the employer for the criminal
negligence of his employee (AQUINO, Torts and
Damages, supra at 722).
Employee’s conviction of criminal negligence proven
in a criminal action is sine qua non for employer’s
subsidiary liability to attach. Employee’s criminal
negligence conclusively binds the employer to be
subsidiary liable for the damages awarded (Fernando
v. Franco, G.R. No. L-27786, January 30, 1971). The
defense that the employer exercised due diligence in
the selection and supervision of the employee is not
available herein.
REQUISITES OF VICARIOUS LIABILITY
OF EMPLOYERS UNDER ARTICLE 103
OF THE REVISED PENAL CODE: (ICE)
1. Employee is Insolvent;
2. Employee was Convicted of the offense
committed in the discharge of his duties; and
3. Employer is Engaged in any kind of industry
(Philippine Rabbit Bus Lines, Inc. v. People, G.R.
No. 147703, April 14, 2004).
The employer cannot defeat the finality of the
judgment by filing a notice of appeal on its own behalf
in the guise of asking for a review of its subsidiary civil
liability. Both the primary civil liability of the accused-
employee and the subsidiary civil liability of the
employer are carried in one single decision that has
become final and executory (Philippine Bus Rabbit
Lines, Inc. v. People of the Philippines, G.R. No.
147703, April 14, 2004).
LIABILITY OF THE STATE
GENERAL RULE: The State is not vicariously liable.
REASON: It is a basic constitutional rule that the
State cannot be sued without its consent. Consent of
the State to be sued can be manifested through a
special law or general law allowing the State to be
sued (AQUINO, Torts and Damages, supra at 6732).
EXCEPTIONS:
1. Special Agent
– one specifically commissioned to carry out the
acts complained of outside of such agent’s
regular duties (Republic v. Hon. Palacio, G.R.
No. L-20322, May 29, 1968).
The responsibility of the state is limited by Article
1903 of the Civil Code to the case wherein it
acts through a special agent (and a special agent
is one who receives a definite and fixed order or
commission, foreign to the exercise of the duties
of his office if he is a special official) so that in
representation of the state and being bound to
act as an agent thereof, he executes the trust
confided to him. This concept does not apply to
any executive agent who is an employee of the
acting administration and who on his own
responsibility performs the functions which are
inherent in and naturally pertain to his office and
which are regulated by law and the regulations
(Merritt v. Government of the Philippine Islands,
G.R. No. 11154, March 21, 1916).
2. Government Owned and Controlled
Corporations
– Not all government entities, whether corporate
or non-corporate, are immune from suits.
Immunity is determined by the character of the
objects for which the entity was organized
(Philippine National Railways v. IAC, G.R. No.
70547, January 22, 1993).
The point is that when the government enters into
a commercial business it abandons its sovereign
capacity and is to be treated like any other private
corporation (Id.).
Two Aspects of Liability:
1. Its public or governmental aspects where it is
liable for the tortious acts of the special
agents only.
 2. Its private or business aspects (as when it
engages in private enterprise) where it
becomes liable as an ordinary employer.
NOTE: The State’s agent, if a public official, must
not only be specially commissioned to a
particular task but that such task must be foreign
to said officials’ usual governmental functions
(Sps. Fontanilla v. Maliaman, G.R. No. 55693,
December 1, 1989).
Liability of Other Public Corporations or
Officers
a. Municipal Corporations - Provinces, cities
and municipalities shall be liable for the death
of, or injuries suffered, by any person by
reason of the defective condition of roads,
streets, bridges, public buildings and other
public works under their control or
supervision (CIVIL CODE, Art. 2189).
b. Public Officers – A public officer is by law
not immune from damages in his/her
personal capacity for acts done in bad faith
which, being outside the scope of his
authority, are no longer protected by the
mantle of immunity for official actions
(Vinzons – Chato v. Fortune Tobacco
Corporation, G.R. No. 141309, June 19,
2007).
It is not necessary that the defendant
under Article 32 should have acted with
malice or bad faith, otherwise, it would
defeat its main purpose, which is the
effective protection of individual rights. It
suffices that there is a violation of the
constitutional right of the plaintiff (Silahis
International Hotel, Inc. v. Soluta, G.R. No.
163087, February 20, 2006).
3. Judges
– not liable for damages for errors in deciding
cases (Barroso v. Arche, A.C. No. 216-CFI,
September 30, 1975).
SCHOOLS, TEACHERS AND
ADMINISTRATORS
They are liable for damages caused by the pupils and
students or apprentices in their custody, instruction or
supervision, whether academic or non-academic
(AQUINO, Torts and Damages, supra at 674).
NOTE: Article 218 of the Family Code expressly
provides that the responsibility and authority of the
school and other persons exercising special parental
authority shall apply to all authorized activities
whether inside or outside the premises of the school,
entity, or institution (Id. at 632).
When an academic institution accepts students for
enrollment, there is established a contract between
them, resulting in bilateral obligations which parties
are bound to comply with. For its part, the school
undertakes to provide the student with an education
that would presumably suffice to equip him with the
necessary tools and skills to pursue higher education
or a profession. On the other hand, the student
covenants to abide by the school's academic
requirements and observe its rules and regulations
(St. Luke's College of Medicine-William H. Quasha
Memorial Foundation v. Spouses Perez, G.R. No.
222740, September 28, 2016).
STATUTORY BASIS OF LIABILITY:
1. Article 219 of the Family Code
– applies if the student is a minor.
Persons Liable:
a. School, administrators, teachers or
individual, institution engaged in child care
(e.g., Day care center) – principally and
solidarily liable.
NOTE: Proof of exercise of proper diligence
required under the particular circumstances
may be a defense.
b. Parents and those exercising substitute
parental authority – subsidiarily liable
(FAMILY CODE, Art. 219).
2. Art. 2180 of the Civil Code
– applies even if student is NO longer a minor
(AQUINO, Torts and Damages, supra at 681).
Persons liable:
a. Teachers or heads of establishments of arts
and trades – liable for damages caused by
their students so long as they remain in their
custody.
b. By way of exception, it is only the head of the
school who is liable where the injury is
caused in a school of arts and trade
(Amadora v. CA, G.R. No. L-47745, April 15,
1988).
3. Article 103 of the Revised Penal Code
– the subsidiary liability of the employer under
Article 102 shall also apply to teachers for
felonies committed by their pupils.
The phrase “so long as (the students) remain in
their custody” means the protective and supervisory
custody that the school and its heads and teachers
exercise over the pupils and the students for as long
as they are at attendance in the school, including
recess time. Nothing in the law requires that for such
liability to attach, the pupil-tortfeasor must live and
board in the school (Spouses Palisoc v. Brillantes,
G.R. No. L-29025, October 4, 1971).
While the custody requirement does not mean that
the student must be boarding with the school
authorities, it does signify that the student should be
within the control and under the influence of the
school authorities at the time of the occurrence of the
injury. This does not necessarily mean that such,
custody be co-terminus with the semester, beginning
with the start of classes and ending upon the close
thereof, and excluding the time before or after such
period, such as the period of registration, and in the
case of graduating students, the period before the
commencement exercises. In the view of the Court,
the student is in the custody of the school
authorities as long as he is under the control and
influence of the school and within its premises,
whether the semester has not yet begun or has
already ended (Amadora v. CA, G.R. No. L-47745,
April 15, 1988).
As long as it can be shown that the student is in the
school premises in pursuance of a legitimate student
objective, in the exercise of a legitimate student right,
and even in the enjoyment of a legitimate student
right, and even in the enjoyment of a legitimate
student privilege, the responsibility of the school
authorities over the student continues. Indeed, even
if the student should be doing nothing more than
relaxing in the campus in the company of his
classmates and friends and enjoying the ambience
and atmosphere of the school, he is still within the
custody and subject to the discipline of the school
authorities under the provisions of Article 2180 (Id.).
In one case, the Court ruled that it is only the teacher
and not the head of an academic school, whether
academic or non-academic, who should be
answerable for torts committed by their children
(Ylarde v. Aquino, G.R. No. L-33722, July 29, 1988).
RULE ON ACTS COMMITTED OUTSIDE
SCHOOL
There are instances where the school might be called
upon to exercise its power over its student for acts
committed outside the school premises and beyond
school hours in the following:
1. In cases of violation of school policies or
regulations occurring in connection with school
sponsored activity off-campus; or
2. In cases where the misconduct of the student
involves his status as a student or affects the
good name and reputation of the school (Angeles
v. Sison, G.R. No. L-45551, February 16, 1982).
ACTUAL TORTFEASOR IS NOT EXEMPT
FROM LIABILITY
The minor, ward, employee, special agent, pupil,
student and apprentice who actually committed the
delictual acts are not exempted by the law from
personal responsibility. They may be sued and made
liable alone as when the vicarious obligor proves that
he exercised the diligence of a good father of a family
(DE LEON, Torts and Damages, supra at 396).
NATURE OF RESPONSIBILITY OF
VICARIOUS OBLIGOR
The liability of the vicarious obligor is primary and
direct, not subsidiary. His responsibility is not
conditioned upon the insolvency or prior recourse
against the negligent tortfeasor (De Leon Brokerage
Co. Inc. v. CA, G.R. No. L-15247, February 28, 1962).
PARTNERSHIP
Liability is entirely imputed, and the partnership
cannot obviously invoke diligence in the selection and
supervision of the partner (AQUINO, Torts and
Damages, supra at 729).
TEST OF LIABILITY
Whether the wrong was committed in behalf of the
partnership and within the reasonable scope of its
business, and if so, the partners are all liable as joint
tortfeasors (Id.).
SPOUSES
a. Absolute community of property
It is answerable for liabilities incurred by either
spouse by reason of crime or quasi-delict in case
of absence or insufficiency of the exclusive
property of the debtor-spouse.
Payments considered as advances to be
deducted from the share of the debtor-spouse
upon liquidation of the community (FAMILY
CODE, Art. 94, par. 9).
b. Conjugal partnership of gains
GENERAL RULE: Pecuniary indemnities
imposed upon the husband or wife are not
chargeable against the conjugal partnership but
against the separate properties of the wrongdoer
(AQUINO, Torts and Damages, supra at 731).
EXCEPTIONS: Conjugal partnership should be
made liable:
i. When the profits have inured to the benefit of
the partnership; or
ii. If one of the spouses committed the tort while
performing a business or if the act was
supposed to benefit the partnership. (Id.).
c. Separation of Property Regime
Each spouse is responsible for his/her separate
obligation (Id.).
MOTOR VEHICLE MISHAPS
SITUATION LIABILITY
The owner is inside the vehicle The owner is
at the time of the accident. He solidarily liable
could have, by the use of with his driver.
diligence, prevented the
misfortune but did not do so RATIO: The
(PINEDA, Torts and Damages, owner’s own
supra at 126). omission is a
concurring
proximate cause
of the injury.
The driver was found guilty of The driver
reckless driving or violating disputably
traffic regulations at least twice presumed
within the next preceding two negligent.
months before the accident.
The owner was not in the Article 2180
motor vehicle at the time of the applies.
accident.
(CIVIL CODE, Art. 2184).
NOTE: It refers to owners of vehicles who are not
included in the terms of Article 2180 as “owners of an
establishment or enterprise.” It is intended to cover
owners of vehicles for private use (DE LEON, Torts
and Damages, supra at 422).
There is a rebuttable presumption that a driver of a
motor vehicle has been negligent if at the time of the
mishap, he was violating any traffic regulation (CIVIL
CODE, Art. 2185).
REGISTERED OWNER RULE
1. Liability
The registered owner of a vehicle is primarily
responsible to the public for whatever damage or
injury the vehicle may cause even if he had
already sold it to someone else (Erezo v. Jepte,
G.R. No. L-9605, September 30, 1957).
Where the registered owner is allowed to evade
responsibility by proving who the supposed
transferee or owner is, it would be easy for him,
by collusion with others or otherwise, to escape
said responsibility by transferring the same to an
indefinite person who possesses no property with
which to respond financially for the damage or
injury done. The policy behind the vehicle
registration is the easy identification of the owner
who can be held responsible in case of accident,
damage or injury caused by the vehicle, so as not
to inconvenience or prejudice a third party injured
by one whose identity cannot be secured
(Cadiente v. Macas, G.R. No. 161946, November
14, 2008).
NOTE: It is imperative to apply the registered-
owner rule in a manner that harmonizes it with
Articles 2176 and 2180 of the Civil Code. Rules
must be construed in a manner that will
harmonize them with other rules so as to form a
uniform and consistent system of jurisprudence.
In light of this, the words used in Del Carmen are
particularly notable. There, this court stated that
Article 2180 "should defer to" the registered-
owner rule. It never stated that Article 2180
should be totally abandoned (Caravan Travel and
is Tours International, Inc. v. Abejar, G.R. No.
170631, February 10, 2016).
Therefore, the appropriate approach is that in
cases where both the registered-owner rule and
Article 2180 apply, the plaintiff must:
1. First establish that the employer is the
registered owner of the vehicle in question.
2. Once the plaintiff successfully proves
ownership, there arises a disputable presumption
that the requirements of Article 2180 have been
proven. (Id.).
NOTE: As a consequence, the burden of proof
shifts to the defendant to show that no liability
under Article 2180 has arisen. (Id.).
2. Leased Vehicles
The registered owner of any vehicle, even if not
for public service, is primarily liable to third
persons for deaths, injuries, and damages that it
caused. The rule applies even if the vehicle is
leased to third persons (BA Finance Corporation
v. CA, G.R. No. 94566, July 3, 1992).
3. Stolen Vehicles
However, the registered owner is not liable when
an accident was caused by the person who stole
it (Duavit v. CA, G.R. No. 82318, May 18, 1989).
4. Kabit System
The “registered owner” rule is applicable. The
registered owner who is sought to be liable for
quasi-delict cannot be allowed to prove the actual
operator of the vehicle involved in the accident
(Lim v. CA, G.R. No. 125817, January 16, 2002).
RECOURSE OF THE REGISTERED
OWNER
The liability is subject to his right of recourse against
the transferee or buyer (AQUINO, Torts and
Damages, supra at 710).
NOTE: The policy cannot be applied if the plaintiff is
the person who is allegedly involved in such system
(Lim v. CA, CA, G.R. No. 125817, January 16, 2002).
EMPLOYER- EMPLOYEE RELATIONSHIP
The registered owner of the motor vehicle is
considered as the employer of the tortfeasor-driver ,
and is made primarily liable for the tort committed by
the latter under Article 2176, in relation with Article
2180, of the Civil Code (Metro Manila Transit
Corporation v. Cuevas, G.R. No. 167797, June 15,
2015).There must be an employer-employee
relationship between the driver and the present
owner-buyer-lessee (who is deemed the registered
owner) and the driver must have caused the injury in
the performance of his functions (AQUINO, Torts and
Damages, supra at 718).
NOTE: Even if a sale has been executed before a
tortuous incident, the sale, if unregistered, has no
effect as to the right of the public and third persons to
recover from the registered owner (PCI Leasing and
Finance, Inc v. UCPB General Insurance, Inc., G.R.
No. 162267, July 4, 2008).
JOINT TORTFEASORS
Two (2) or more persons acting together in
committing a wrong, or contributing to its commission,
or assisting or participating therein actively and with
common intent, so that injury results to a third person
therefrom (DE LEON, Torts and Damages, supra at
18).
Test:
1. Whether plaintiff has a single cause of action
against such tortfeasors; or
2. Whether plaintiff has several causes of action
against each of tortfeasors (Id. at 18-19).
A payment in full for the damage done, by one of the
joint tortfeasors, of course satisfies any claim which
might exist against the others. There can be but
satisfaction. The release of one of the joint tortfeasors
by agreement generally operates to discharge all
(Lafarge Cement Philippines, Inc. v. Continental
Cement Corporation, G.R. No. 155173, November
23, 2004).
No actor's negligence ceases to be a proximate
cause merely because it does not exceed the
negligence of other actors. Each wrongdoer is
responsible for the entire result and is liable as
though his acts were the sole cause of the injury (Far
Eastern Shipping v. CA, G.R. No. 179446, January
10, 2011).
Although the employer is not the actual tortfeasor, the
law makes him vicariously liable on the basis of the
civil law principle of pater familias for failure to
exercise due care and vigilance over the acts of one’s
subordinates to prevent damage to another. In the
last paragraph of Article 2180 of the Civil Code, the
employer may invoke the defense that he observed
all the diligence of a good father of a family to prevent
damage (Filcar Transport Services v. Jose Espinas,
G.R. No. 174156, June 20, 2012).
SOLIDARY LIABILITY OF JOINT
TORTFEASORS
The responsibility of two or more persons who are
liable for a quasi-delict is solidary (CIVIL CODE, Art.
2194).
Under Article 2194 of the Civil Code, joint tortfeasors
are solidarily liable for the resulting damage. In other
words, joint tortfeasors are each liable as principals,
to the same extent and in the same manner as if they
had performed the wrongful act themselves (People
v. Velasco, G.R. No. 195668, June 25, 2014).
There is no contribution between joint tortfeasors
whose liability is solidary since both of them are liable
for the total damage. Where the concurrent or
successive negligent acts or omissions of two or
more persons, although acting independently, are in
combination the direct and proximate cause of a
single injury to a third person, it is impossible to
determine in what proportion each contributed to the
injury and either of them is responsible for the whole
injury (People v. Velasco, G.R. No. 195668, June 25,
2014).
Joint tortfeasors are jointly and severally liable for the
tort which they commit. The persons injured may sue
all of them or any number less than all. Each is liable
for the whole damages caused by all, and all together
are jointly liable for the whole damage. It is no
defense for one sued alone, that the others who
participated in the wrongful act are not joined with him
as defendants; nor is it any excuse for him that his
participation in the tort was insignificant as compared
to that of the others (Sing v. Li Seng Giap & Sons Inc.,
G.R. No. 170596, November 28, 2008).
CONCURRENT NEGLIGENCE
Where the concurrent or successive negligent acts or
omissions of two or more persons, although acting
independently, are, in combination, the direct and
proximate cause of a single injury to a third person
and it is impossible to determine in what proportion
each contributed to the injury, either is responsible for
the whole injury, even though his act alone might not
have caused the entire injury, or the same damage
might have resulted from the acts of the other
tortfeasor (PNCC v. CA, G.R. No. 159270, August 22,
2005).
In other words, where their concurring negligence
resulted in injury or damage to a third party, they
become joint tortfeasors and are solidarily liable for
the resulting damage under article 2194 of the Civil
Code (Loadmasters Customs Services, Inc. v. Glodel
Brokerage Corporation, G.R. No. 179446, January
10, 2011).
In case of an injury to a passenger due to the
negligence of the driver of the bus on which he was
riding, and the driver of the other vehicle, the drivers
and owners of the two vehicles are jointly and
severally liable for damages (Construction Dev. Corp.
of the Phils. v. Estrella, et. al., G.R. No. 147791,
September 8, 2006).
Where the obligation of the parties is solidary, either
of the parties is indispensable, and the other is not
even a necessary party because complete relief is
available from either (Cerezo v. Tuazon, G.R. No.
141538, March 23, 2004).
PROXIMATE CAUSE
PROXIMATE CAUSE
That cause which, in natural and continuous
sequence, unbroken by any efficient intervening
cause, produces the injury, without which the result
would not have occurred (Dela Cruz v. Viano, G.R.
No. 219649, July 26, 2017).
REMOTE CAUSE
That cause which some independent force merely
took advantage of to accomplish something not the
natural effect thereof (AQUINO, Torts and Damages,
supra at 334).
NEAREST CAUSE
That cause which is the last link in the chain of events;
the nearest in point of time or relation (Id. at 336).
NOTE: Proximate cause is not necessarily the
nearest cause (Id at 334.).
CONCURRENT CAUSES
Where several causes producing the injury are
concurrent and each is an efficient cause without
which the injury would not have happened, the injury
may be attributed to all or any of the causes and
recovery may be had against any or all of the
responsible persons (Far Eastern Shipping Co., v.
CA, G.R. No. 130068, October 1, 1998).
The actor is liable even if the active and substantially
simultaneous operation of the effects of a third
person’s innocent, tortious or criminal act is also a
substantial factor in bringing about the harm so long
as the effects of the actor’s negligent conduct actively
and continuously operate to bring about harm to
another (Africa v. Caltex. G.R. No. L-12986, March
31 1966).
CAUSE-IN-FACT
In determining the proximate cause of the injury, it is
first necessary to determine if defendant’s negligence
was the cause-in-fact of the damage to the plaintiff. If
defendant’s negligence was not a cause-in-fact, the
inquiry stops; but if it is a cause-in-fact, the inquiry
shifts to the question of limit of liability of the
defendant (AQUINO, Torts and Damages, supra at
341).
It is necessary that there is proof that defendant’s
conduct is a factor in causing plaintiff’s damage (Id.
at 347-348).
NOTE: What needs to be determined is whether the
defendant’s act or omission is a casually relevant
factor (Id.).
CAUSE-IN-FACT TESTS
1. Sine Qua Non Test (but-for test)
Defendant’s conduct is the cause in fact of the
injury under the “but-for-test” if the damage would
not have resulted had there been no negligence
on the part of the defendant. Conversely,
defendant’s negligent conduct is not the cause in
fact of the plaintiff’s damage if the accident could
not have been avoided in the absence thereof
(Id.).
NOTE: The concept “where if the first object had
not been, the second never had existed” is the
foundation of the “but-for-test” (Id.).
2. Substantial Factor Test
Makes the negligent conduct the cause in fact of
the damage if it was a substantial factor in
producing the injuries (Id. at 349). The accident
would not have occurred had there been no
negligence of the part of the defendant, the
defendant’s conduct is a substantial factor in
bringing about the damage or injury (Id.).
3. Necessary element of Sufficient Set
(NESS Test)
The negligent act or omission is a cause-in-fact
of the damage if it is a necessary element of a
sufficient set (NESS) (Id. at 350).

NOTE: Whether a particular condition qualifies
as a casually relevant factor will depend on
whether it was necessary to complete a set of
conditions jointly sufficient to account for the
given occurrence (Id.).
Duplicative v. Pre-emptive Causation
Duplicative Causation occurs when two (or more)
such sets operate simultaneously to produce the
effect; in other words, the effect is over-
determined. Pre-emptive causation, by contrast,
occurs when one causal set ‘trumps’ another,
potential set lurking in the background (Id. at 351-
352).
Illustration: Suppose a man slips while running
down a slippery stair and two candidate causes
can be seen because they are not normally
present: (a) the man slipped simply because he
was running; and (b) the man slipped because
the stairs is slippery. There are at least four
possibilities here.
(a) The slippery stair is the only cause. The man
would have slipped even if he were not
running;
(b) The slippery stair is only one of the causes
simultaneously occurring. The fact that the
man was running was sufficient for the injury,
by the fact that the stairs was slippery was
equally sufficient. There are two overlapping
causal sets.
(c) The slippery stair was a member of a causal
set contributing to the effect. The slippery
stairs alone would not have been sufficient to
cause the injury and the fact that the man
was running was equally insufficient. The
injury was a cumulative effect of all the
causes.
(d) The slippery stairs may not have caused the
injury. One possibility is that the man’s
running may have been the only cause; it is
part of a set that was necessary.
In these cases, the slippery stairs will be
considered as a cause-in-fact of the injury
situations contemplated in (a), (b), and (c)
and obviously not in situation (d) (Id. at 352-
353).
NOTE: According to AQUINO, there is no statutory
provision in this jurisdiction that mandates the use of
a particular cause-in-fact test. But the primary test
in determining the cause-in-fact of the damage is
the “but-for-test”. However, in cases involving
duplicative causes, either the Substantial Factor Test
or the “NESS” Test can be applied (Id. at 359).
EFFICIENT INTERVENING CAUSE
One which destroys the causal connection between
the negligent act and the injury and thereby negatives
liability (novus actus interviens) (AQUINO, Torts
and Damages, supra at 370).
It will be regarded as the proximate cause and the
first cause as too remote, where the chain of events
is so broken that they become independent and the
result cannot be said to be the consequence of the
primary cause (Id.).
There is no efficient intervening cause if the force
created by the negligent act or omission have either:
1. Remained active itself;
2. Created another force which remained active
until it directly caused the result, or
3. Created a new active risk of being acted upon by
the active force that caused the result (Id.).
TEST OF SUFFICIENCY:
1. It must be new and independent and not under
the control of the wrongdoer, or one which by the
exercise of reasonable foresight and diligence,
he should have anticipated and guarded against
it;
2. It must break the continuity of the causal
connection between the original negligent act
and omission; and
3. The injury so that the former cannot be said to
have been the efficient cause of the latter (Id. at
370-371).
VIOLATION OF A STATUTE
The mere fact of violation of a statute is NOT
sufficient basis for an inference that such violation
was the proximate cause of the injury complained.
However, if the very injury has happened which was
intended to be prevented by the statute, it has been
held that violation of the statute will be deemed to be
the proximate cause of the injury (Teague v.
Fernandez, G.R. No. L-29745. June 4, 1973).
FORESEEABLE INTERVENING CAUSE
This cannot be considered as a sufficient intervening
cause because there is an opportunity to guard
against it (AQUINO, Torts and Damages, supra at
373).
NOTE: If the intervening cause is a recurrent feature
of the environment, it is not an efficient intervening
cause because it is foreseeable (Id. at 374).
A tortfeasor is liable for the consequence of
negligence, mistake or lack of skill of a physician or
surgeon whose treatment aggravated the original
injury. The same is considered a normal and
foreseeable risk (Id.).
UNFORESEEN AND UNEXPECTED ACT
OR CAUSE
The intervention of an unforeseen and unexpected
cause is not sufficient to relieve the wrongdoer from
consequences of negligence if such negligence
directly and proximately cooperates with the
independent cause in the resulting injury (Africa v.
Caltex, G.R. No. L-12986, March 31 1966).
An unforeseen and unexpected act of a third person
may not be considered an efficient intervening cause
if it is duplicative in nature or if it merely aggravated
the injury that resulted because of the prior cause.
The same conclusion can be reached if the third
person’s act is part of the causal set, together with the
defendant’s negligence, that operated to cause the
injury (AQUINO, Torts and Damages, supra at 375-
376).
CAUSE AS DISTINGUISHED FROM
CONDITION
The Supreme Court adopted the view that it is no
longer practicable to distinguish between cause and
condition (Id. at 366).
Many courts have sought to distinguish between the
active "cause" of the harm and the existing
"conditions" upon which that cause operated. If the
defendant has created only a passive static condition,
which made the damage possible, the defendant is
said not to be liable. It is not the distinction between
"cause" and "condition" which is important but the
nature of the risk and the character of the intervening
cause (Phoenix Construction v. IAC, G.R. No. L-
65295, March 10, 1987).
DOCTRINE OF LAST CLEAR CHANCE
This principle states that the contributory negligence
of the person injured will not defeat the claim for
damages if it is shown that the defendant might, by
the exercise of reasonable care and prudence, have
avoided the consequences of the negligence of the
injured party (ALBANO, Torts and Damages, supra at
40).
Under this doctrine, the negligent act emanates
originally from the plaintiff but the defendant is aware
of that peril, to which the plaintiff has been exposed
to, yet he does not perform an act to avoid the
accident. The defendant is liable for damages
because he has not exercised the required degree of
diligence (Id.).
Sometimes referred to as:
1. Discovered Peril (AQUINO, Torts and Damages,
supra at 347);
2. Doctrine of Supervening Negligence (Sing v. Li
Seng Giap & Sons, Inc., G.R. No. 170596,
November 28, 2008); or
3. Humanitarian Negligence Doctrine (PINEDA,
Torts and Damages, supra at 58).
Even though a person’s own acts may have placed
him in a position of peril, and an injury results, the
injured person is entitled to recovery (AQUINO, Torts
and Damages, supra at 384).
Elements: (PoKLA)
1. Plaintiff was in a Position of danger and, by his
own negligence, became unable to escape from
such position by the use of ordinary care;
2. Defendant Knew that the plaintiff was in a
position of danger or in the exercise of ordinary
care should have known such;
3. Defendant had the Last clear chance to avoid the
accident by the exercise of ordinary care but
failed to exercise such last clear chance; and
4. The Accident occurred as a proximate result of
such failure (DE LEON, Torts and Damages,
supra at 291).
In Philippine Bank of Commerce v. CA (G.R. No.
97626, March 14, 1997), the doctrine of last clear
chance was applied to a banking institution. The
Supreme Court ruled that the bank, thru its teller, had
the last clear opportunity to avert the injury incurred
by its client, simply by faithfully observing their self-
imposed validation procedure.
Cases when the doctrine was held inapplicable:
1. If the plaintiff was not negligent;
2. The defendant is required to act instantaneously,
and if the injury cannot be avoided by the
application of all the means at hand after the peril
is or should have been discovered;
3. If defendant’s negligence is a concurrent cause
and which was still in operation up to the time the
injury was inflicted;
4. Where the plaintiff, a passenger, filed an action
against a carrier based on contract; and
5. If the actor, though negligent, was not aware of
the danger or risk brought about by the prior fraud
or negligent act (Bank of the Philippine Islands v.
CA, G.R. No. 102383, November 26, 1992).
Under the Doctrine of Last Clear Chance, the one
who has the last reasonable opportunity to avoid the
impending harm and fails to do so is chargeable with
the consequences without reference to the prior
negligence of the other party (Glan People’s Lumber
Hardware v. IAC, G.R. No. 70493, May 18, 1989).
The Doctrine of Last Clear Chance cannot be
extended into the field of joint tortfeasors as a test of
whether only one of them should be held liable to the
injured person and it cannot be invoked as between
defendants concurrently negligent (Bustamante v.
CA, G.R. No. 89880, February 6, 1991).

TORTS COVERED BY
THE CIVIL CODE
PROVISIONS ON
HUMAN RELATIONS
CATCH ALL PROVISIONS (CIVIL CODE,
ARTS. 19-21)
Articles 19, 20, and 21 are provisions on human
relations that “were intended to expand the concept
of torts in this jurisdiction by granting adequate legal
remedy for the untold number of moral wrongs which
is impossible for human foresight to specifically
provide in the statutes.” (AQUINO, Torts and
Damages, supra at 392).
CLASSES:
1. Abuse of Right
2. Acts Contrary to Law
3. Acts Contrary to Morals or Acts Contra Bonus
Mores
Justice Leonen aptly elaborated on the distinctive
applications of Articles 19, 20 and 21, which are
general provisions on human relations, vis-a-vis
Article 2176, which particularly governs quasi-delicts:
“Article 19 is the general rule which governs the
conduct of human relations. By itself, it is not the
basis of an actionable tort. Article 19 describes the
degree of care required so that an actionable tort may
arise when it is alleged together with Article 20 or
Article 21.
Article 20 concerns violations of existing law as
basis for an injury. It allows recovery should the act
have been willful or negligent. Willful may refer to the
intention to do the act and the desire to achieve the
outcome which is considered by the plaintiff in tort
action as injurious. Negligence may refer to a
situation where the act was consciously done but
without intending the result which the plaintiff
considers as injurious.
Article 21, on the other hand, concerns injuries that
may be caused by acts which are not necessarily
proscribed by law. This article requires that the act be
willful, that is, that there was an intention to do the act
and a desire to achieve the outcome. In cases under
Article 21, the legal issues revolve around whether
such outcome should be considered a legal injury on
the part of the plaintiff or whether the commission of
the act was done in violation of the standards of care
required in Article 19 (Alano v. Magud-Logmao, G.R.
No. 175540, April 7, 2014 (J. Leonen, Concurring)
cited by AQUINO, Torts and Damages, supra at 393).
Article 2176 covers situations where an injury
happens through an act or omission of the defendant.
When it involves a positive act, the intention to
commit the outcome is irrelevant. The act itself must
not be a breach of an existing law or a pre-
existing contractual obligation. What will be
considered is whether there is "fault or negligence”
attending the commission of the act which
necessarily leads to the outcome considered as
injurious by the plaintiff. The required degree of
diligence will then be assessed in relation to the
circumstances of each and every case (Alano v.
Magud-Logmao, supra).
Thus, with respect to negligent acts or omissions, it
should therefore be discerned that Article 20 of the
Civil Code concerns "violations of existing law as
basis for an injury", whereas Article 2176 applies
when the negligent act causing damage to
another does not constitute "a breach of an
existing law or a pre-existing contractual
obligation." (St. Martin Polyclinic, Inc. v. LWV
Construction Corporation, G.R. No. 217426, 4
December 2017).
ABUSE OF RIGHT
Standards in the exercise of one’s rights and in the
performance of one’s duties:
1. To act with justice;
2. To give everyone his due; and
3. To observe honesty and good faith (CIVIL CODE,
Art. 19).
A right, though by itself legal because it is recognized
or granted by law as such, may nevertheless become
the source of some illegality (Ardiente v. Sps. Javier
and Ma. Theresa Pastorfide, G.R. No. 161921, July
17, 2013).
When a right is exercised in a manner which does not
conform to these standards and results in damage to
another, a legal wrong is thereby committed for which
the wrongdoer must be held responsible (Ardiente v.
Sps. Javier and Ma. Theresa Pastorfide, G.R. No.
161921, July 17, 2013).
The following elements must concur: (LEP)
1. Existence of a Legal right or duty;
2. Which is Exercised in bad faith;
3. For the sole intent of Prejudicing or injuring
another (Padillo v. Rural Bank of Nabunturan,
Inc., G.R. No. 199338, January 21, 2013).
Good Faith refers to the state of mind which is
manifested by the acts of the individual concerned. It
consists of the intention to abstain from taking an
unconscionable and unscrupulous advantage of
another (California Clothing Inc. v. Shirley G.
Quiñones, G.R. No. 175822, October 23, 2013).
Malice or Bad Faith implies a conscious and
intentional design to do a wrongful act for a dishonest
purpose or moral obliquity (California Clothing Inc. v.
Shirley G. Quiñones, G.R. No. 175822, October 23,
2013).
ACTS CONTRARY TO LAW (CIVIL CODE,
ART. 20)
This article speaks of the general sanction for all
other provisions of law, which do not especially
provide for their own sanction (DE LEON, Torts and
Damages, supra at 79-80).
NOTE: Art. 20 does not distinguish; the act may be
done willfully or negligently (Id.).
In the case of Bacolod-Murcia Milling Co. v. First
Farmers Milling Co. NIDC and PNB extended loans
to defendant sugar mills, which petitioner alleges that
assists in the illegal creation and operation of said
mills, it therefore filed an action for injunction and
prohibition with damages against NIDC and PNB.
The Supreme Court dismissed the petition and held
that, what appears from the record is that PNB and
NIDC came into the picture in the ordinary and usual
course of its business after the borrowing entity had
established itself as capable of being treated as a
new milling district because it could already operate
and had its array of adhering partners (Bacolod-
Murcia Milling Co. v. First Farmers Milling Co., G.R.
No. L-29041, March 24, 1981).
RATIONALE: The doing of an act which is in itself
perfectly lawful will not render one liable as for a tort,
simply because the unintended effect of such at is to
enable or assist another person to do or accomplish
a wrong (Id.).
ACTS CONTRARY TO MORALS OR ACTS
CONTRA BONUS MORES (CIVIL CODE,
ART. 21)
This article is designed to fill in the “countless gaps
in the statutes, which leave so many victims of moral
wrongs helpless, even though they have actually
suffered material and moral injury” (DE LEON, Torts
and Damages, supra at 80).
Elements: (LCD)
1. Act which is Legal;
2. The act is Contrary to morals, good customs,
public order or public policy; and
3. The act is Done with intent to injure (Mendoza v.
Spouses Gomez, G.R. No. 160110, June 18,
2014).
NOTE: Damages are recoverable even if no positive
law was violated (DE LEON, Torts and Damages,
supra at 361).
Illustrative Cases (BAD-STAMPID)
1. Breach of Promise to Marry
GENERAL RULE: Breach of promise to marry
by itself is not actionable (AQUINO, Torts and
Damages, supra at 416).
EXCEPTIONS: In cases where there is an act
independent of the breach of promise to marry
which gives rise to liability:
a. Cases where there was financial damage
(Id.).
To formally set a wedding and go through
and spend for all the wedding preparations
and publicity, only to walk out of it when the
matrimony was about to be solemnized, is
palpably and unjustifiably contrary to good
customs for which the defendant is
answerable for damages (Wassmer v. Velez,
G.R. No. L-20089, December 26, 1964).
b. Social humiliation caused to one of the
parties (Id.)
c. Where there was moral seduction (Id.).
Moral seduction, although not punishable,
connotes the idea of deceit, enticement,
superior power or abuse of confidence on the
part of the seducer to which the woman has
yielded (Baksh v. CA, G.R. No. 97336,
February 19, 1993).
Breach of promise to marry per se is not an
actionable wrong. But where a man's
promise to marry is in fact the proximate
cause of the acceptance of his love by a
woman and his representation to fulfill that
promise thereafter becomes the proximate
cause of the giving of herself unto him in a
sexual congress, proof that he had, in reality,
no intention of marrying her and that the
promise was only a subtle scheme or
deceptive device to entice or inveigle her to
accept him and to obtain her consent to the
sexual act, could justify the award of
damages pursuant to Article 21 not because
of such promise to marry but because of the
fraud and deceit behind it and the willful injury
to her honor and reputation which followed
thereafter. It is essential, however, that such
injury should have been committed in a
manner contrary to morals, good customs or
public policy (Baksh v. CA, G.R. No. 97336,
February 19, 1993).
 No damages can be recovered under Art. 19
and 21 where the sexual intercourse is a
product of voluntariness and mutual desire
(Constantino v. Mendez, G.R. No. 57227,
May 14, 1992).
2. Sexual Assault
Defendant is liable for all forms of sexual assault.
These include the crimes defined in the Revised
Penal Code such as rape, acts of lasciviousness,
and seduction (AQUINO, Torts and Damages,
supra at 421).
NOTE: Defendant is liable even if he satisfied his
lust without promising to marry the offended
party. It may not even matter that the plaintiff and
the defendant are of the same gender (Id.).
3. Disconnection of Utilities
In case a person fails to pay 1 of 2 overdue bills
and consequently, his line gets disconnected
without prior notice, the SC ruled that the state
may regulate, as it has done through Section 97
of the Revised Order No. 1 of the Public Service
Commission, the conditions under which and the
manner by which a public utility such as Meralco
may effect a disconnection of service to a
delinquent customer. Among others, a prior
written notice to the customer is required before
disconnection of the service. Failure to give such
prior notice amounts to a tort (Meralco v. CA,
G.R. No. L-39019, January 22, 1988).
4. Seduction Without Breach of Promise to
Marry
Seduction, by itself, is also an act contrary to
morals, good customs and public policy.
(AQUINO, Torts and Damages, supra at 421).
The defendant is liable if he employed deceit,
enticement, superior power or abuse of
confidence (DESA) in successfully having sexual
intercourse with another even if he satisfied his
lust without promising to marry the offended
party.
It may not even matter that the plaintiff and the
defendant are of the same gender (Id.).
5. Trespass and Deprivation of Property
Kinds:
a. Trespass to and/or deprivation of real
property.
This is committed when a person unlawfully
invades the real property of another. Intent or
bad faith is required for liability for damages
under the Revised Penal Code and Article
451 of the Civil Code to attach (Id. at 422).
No action for damages is allowed where the
builder, planter, or sower acted in good faith.
The landowner is limited to the options
provided for under Article 448 (CIVIL CODE,
Art. 448, 456).
A builder in good faith who acted negligently
may be held liable under Article 2176.
b. Trespass to or deprivation of personal
property.
Theft or robbery of personal property is
trespass.
In the field of tort, trespass extends to all
cases where a person is deprived of his
personal property even in the absence of
criminal liability (AQUINO, Torts and
Damages, supra at 424).
NOTE: It may cover cases where the
defendant was deprived of personal property
for the purpose of obtaining possession of
real property (Id.).
Illustration:
1. Petitioners, in the case of Magbanua v.
IAC, were denied irrigation water for their
farm lots in order to make them vacate
their landholdings. The defendants
violated the plaintiffs’ rights and caused
prejudice to the latter by the unjustified
diversion of the water. Thus, petitioners
are entitled to damages. (Magbanua v.
IAC, G.R. No. L-66870-72, June 29,
1985).
2. A group of drivers took over all jeepneys
of a transportation company as well as
the operation of the service in the
company’s route without authority. The
Supreme Court declared that the act was
in violation of Article 21 (Cogeo – Cubao
Operators and Drivers Association v. CA,
G.R No. 100727, March 18, 1992).
6. Abortion and Wrongful Death
Damages may be recovered by both spouses if:
a. The abortion was caused through the
physician’s negligence; or
b. Was done intentionally without their consent.
A doctor who performs an illegal abortion is
criminally liable under Article 259 of the
Revised Penal Code.
The husband of a woman who voluntarily
procured her abortion may recover damages
from the physician who caused the same on
account of distress and mental anguish
attendant to the loss of the unborn child and
 the disappointment of his parental
expectation (Geluz v. CA, G.R. No. L-16439,
July 20, 1961).
7. Malicious prosecution (see CIVIL CODE,
Arts. 19-21, 26, 32, 33, 35, 2217, 2219, Par.
8)
An action for damages brought by one against
another, against whom a criminal prosecution,
civil suit, or other legal proceeding has been
instituted maliciously and without probable
cause, after the termination of such prosecution,
suit or proceeding in favor of the defendant
therein (Magbanua v. Junsay, G.R. No. 132659,
February 12, 2007).
It is for the mere purpose of vexation or injury
(Drilon v. CA, G.R. No. 107019, March 20, 1997).
Requisites: (FAW)
1. The Fact of prosecution and the further fact
that the defendant (respondent) was himself
the prosecutor, and that the action finally
terminated with an acquittal;
2. That the prosecutor was Actuated or
impelled by legal malice, that is, by improper
or sinister motive; and
3. That in bringing the action, the prosecutor
acted Without probable cause (Diaz v.
Davao Light and Power Co., Inc., G.R.
No.160959, April 4, 2007).
Presence of probable cause signifies absence of
malice (AQUINO, Torts and Damages, supra at
428).
NOTE: Probable Cause is the existence of such
facts and circumstances as would excite the
belief of the prosecutor that the person charged
is guilty if the crime for which he is prosecuted
(Id.).
Absence of malice signifies good faith on the part
of the defendant; good faith may even be based
on mistake of law (Id.).
Acquittal presupposes that criminal information is
filed in court and final judgment rendered
dismissing the case; prior acquittal may include
dismissal by the prosecutor after preliminary
investigation (Globe Mackay and Radio Corp. v.
CA, G.R. No. 81262, August 25, 1989).
8. Public Humiliation
Illustration: The defendant was held liable for
damages under Article 21 of the Civil Code for
slapping the plaintiff (a priest) in public (Patricio
v. Hon. Oscar Leviste, G.R. No. L-51832, April
26, 1989).
Slander by Deed – similar acts punishable under
Art. 359 of the Revised Penal Code; committed
by one who performs an act of dishonor, discredit
or contempt upon the offended party in the
presence of other person or persons (REVISED
PENAL CODE, Art. 359).
9. Illegal Dismissal
The right of the employer to dismiss an employee
should not be confused with the manner in which
the right is exercised and the effects flowing
therefrom (AQUINO, Torts and Damages, supra
at 426).
If the dismissal was done oppressively or in a
manner contrary to morals, good customs and
public policy, the employer should be deemed to
have violated Art. 1701 of the Civil Code, which
prohibits acts of oppression by either capital or
labor against the other, and Article 21 of the Civil
Code (Id.).
Illustrations:
a. False imputation of misdeed to justify
dismissal (Quisaba v. Sta. Ines Melale-
Veneer and Plywood Inc., G.R. No. L-38088,
August 30, 1974).
b. The ground relied upon is a figment of
employer’s imagination (Globe Mackay and
Radio Corp. v. CA, G.R. No. 81262, August
25, 1989).
10. Desertion by A Spouse
A spouse has a legal obligation to live with his/her
spouse. If a spouse does not perform his or her
duty to the other, he may be held liable for
damages for such omission because the same is
contrary to law, morals, and good customs
(AQUINO, Torts and Damages, supra at 421).
TORTS AGAINST HUMAN DIGNITY (SEE
CIVIL CODE, ART. 26)
Torts against human dignity, personality, privacy and
peace of mind of his neighbors and other persons,
though they may not constitute a criminal offense,
shall produce a cause of action for damages,
prevention and other relief.
1. VIOLATION OF THE RIGHT OF PRIVACY
The essence of privacy is the right to be left alone
(Ople v. Torres, G.R. No. 127685, July 23, 1998).
Zones of privacy are recognized and protected in
our laws. Within these zones, any form of
intrusion is impermissible unless excused by law
and in accordance with customary legal process
(Sabio v. Gordon, G.R. No. 174340, October 17,
2006).
Reasonableness of Expectation of Privacy
Two-Part Test:
a. Whether by his conduct, the individual has
exhibited an expectation of privacy; and
b. Whether this expectation is one that the
society recognizes as reasonable (Ople v.
Torres, G.R. No. 127685, July 23, 1998).
NOTE: Other factors, such as customs, physical
surroundings, and practices of a particular
activity, may serve to create or diminish this
expectation (Id.).
It is within the prerogative of educational
institutions to require, as a condition, for
admission, compliance with reasonable school
rules and regulations and policies (which
includes mandatory, random, and suspicion less
drug testing of students). However, the rule is
different with respect to an accused who is
charged before the prosecutor’s office. Drug
testing in this case would violate a persons’ right
to privacy (SJS v. Dangerous Drugs Board, G.R.
No. 157870, November 3, 2008).
Facets of Privacy
Privacy in the Constitutional sphere includes:
a. Privacy in a physical sense
– denotes seclusion, solitude, security, or
bodily integrity.
b. Privacy in an informational sense
– denotes confidentiality, secrecy, or
anonymity, especially with respect to
correspondence, conversation, and records.
c. Proprietary privacy
– limits the use of a person’s name, likeness,
identity, or other attributes of identity and
exclusive possession.
d. Privacy in a decisional sense
– denotes liberty, freedom, choice, or
autonomy in decision making about sex,
reproduction, marriage, family, and health
care (AQUINO, Torts and Damages, supra at
446-447).
Who can invoke:
a. The right to privacy can be invoked only by
natural persons. Juridical persons cannot
invoke such right because the entire basis of
right to privacy is an injury to the feelings and
sensibilities of a party; a corporation would
have no such ground for relief (Valmonte v.
Belmonte, G.R. No. 74930, February 13,
1989).
EXCEPTION: The right against
unreasonable searches and seizure can be
invoked by a juridical entity (Bache & Co.
(Phils.), Inc. v. Ruiz, G.R. No. L-32409,
February 27, 1971).
b. Right to privacy is purely personal in nature,
hence:
i. It can be invoked only by the person
whose privacy is claimed to have been
violated.
ii. It can be subject to waiver of the person
whose privacy is sought to be intruded
into.
iii. The right ceases upon the death of the
person (AQUINO, Torts and Damages,
supra at 451).
EXCEPTION: A privilege may be given to the
surviving relatives of a deceased person to
protect his memory but the privilege exists for
the benefit of the living, to protect their
feelings and to prevent the violation of their
own rights in the character and memory of
the deceased (Id. at 451).
Illustrations:
i. In some cases, the law allows the heirs
of the deceased to enter into a licensing
agreement for the depiction of the life of
the deceased (Lagunzad v. Vda. De
Gonzales, G.R. No. L-32066, August 6,
1979).
ii. Courts have allowed recovery of
damages for the unauthorized use of the
name or picture of a deceased person for
advertising or trade purposes (AQUINO,
Torts and Damages, supra at 416).
A corporation has no right of privacy in its
name since the entire basis of the right is an
injury to the feelings and sensibilities of the
party and a corporation would have no such
ground for relief (Valmonte v. Belmonte, G.R.
No. 74932, February 13, 1989).
Standard Used
The standard to be applied in determining if there
was a violation of the right is that of a person of
ordinary sensibilities. It is relative to the customs
of time and place, and is determined by the norm
of an ordinary person (AQUINO, Torts and
Damages, supra at 458).
Four Types of Invasions of Privacy: (PIFA) (Id.
at 459)
a. Publication of Private Facts
Consists of a cause of action in publicity, of a
highly objectionable kind, given to private
information about the plaintiff, even though it
is true and no action would lie for defamation.
The interest sought to be protected is the
right to be free from unwarranted publicity,
from the wrongful publicizing of the private
affairs and activities of an individual which
are outside the realm of legitimate public
concern (Id. at 475).
Requisites: (PWI)
i. Publicity is given to any private or purely
personal information about a person;
ii. Without the latter’s consent; and
iii. That the publication was made with
Intent of gain or for commercial and
business purposes aggravates the
violation of the right, regardless of
whether or not such publicity constitutes
a criminal offense, like libel or
defamation (Id at 475.).
NOTE: Because of the interest they generate
and their newsworthiness, public figures,
most especially those holding responsible
positions in government enjoy a more limited
right to privacy compared to ordinary
individuals. To be liable, the defendant must
be guilty of knowing and reckless disregard
of the truth (Ayer Productions v. Capulong,
G.R. No. 82380; April 29, 1988).
Kinds of Public Figures:
1. Involuntary Public Figures
– persons who become public figures
through no purposeful actions of their
own;
2. Public Figures for All Purpose
– persons who attain a status according
to which they assumed roles of special
prominence in the affairs of society;
3. Limited-Purpose Public Figures
– persons who have thrust themselves to
the forefront of particular public
controversies in order to influence the
resolution of the issues involved.
(AQUINO, Torts and Damages, supra at
594-595).
Rule on Publication of Official
Proceedings and Official Functions
The publication of facts derived from the
records of official proceedings which are not
otherwise declared by law as confidential,
cannot be considered a tortious conduct (Id.
at 480).
The right to privacy belongs to the individual
acting in his private capacity and not to a
governmental agency or officers tasked with,
and acting in, the discharge of public duties
(Id.).
b. Intrusion
Protects a person’s sense of locational and
psychological privacy. The claim is not so
much one of total secrecy as it is of the right
to define one’s circle of intimacy – to choose
who shall see bequeath the quotidian mask
(Id. at.459).
Is not limited to cases where the defendant
physically trespassed into another’s
property. It includes cases when the
defendant invaded one’s privacy by looking
from the outside (Id. at 460).
The law protects everyone, whether the
plaintiff is popular or not (Id. at 462).
Intrusion in Public Places
No invasion of right to privacy when a
journalist records, photographs or writes
about something that occurs in public places.
People in public places must assume that
they might be photographed or recorded (Id.
at 461).
EXCEPTION: When the acts of the journalist
is to such extent that it constitutes
harassment or overzealous shadowing (Id. at
462).
R.A. 4200 or the Anti-Wiretapping Law
It is illegal for any person not authorized by
all the parties to any private communication
to secretly record such communication by
means of a tape recorder (Ramirez v. CA,
G.R. No. 93833, September 28, 1995).
The use of a telephone extension for
purposes of overhearing a private
conversation without authorization does not
violate R.A. 4200 as it cannot be placed in
the same category as a dictaphone,
dictagraph or the other devices enumerated
in Section 1 of RA No. 4200 thus the use
thereof cannot be considered as "tapping"
the wire or cable of a telephone line (Gaanan
v. IAC, G.R. No. L-69809, October 16, 1986).
Limitations on the Right to Information:
Intrusion and Freedom of the Press
The Constitution protects freedom of the
press. However, the Constitutional right has
never been construed to accord newsmen
immunity from torts or crimes committed
during the course of newsgathering
(AQUINO, Torts and Damages, supra at
462).

Intrusion in the Internet
There will be intrusion through the internet if
a person is engaged in what is known as
unlawful access contemplated under the
Electronic Commerce Act, to wit:
“Access to an electronic file, or an electronic
signature of an electronic data message or
electronic document shall only be authorized
and enforced in favor of the individual or
entity having a legal right to the possession
or the use of plaintext, electronic signature or
file or solely for the authorized purposes. The
electronic key for identity or integrity shall not
be made available to any person or party
without the consent of the individual or entity
in lawful possession of that electronic key
(R.A. 8792, Sec. 31)”.
c. Publicity which Places a Person in a False
Light in the Public Eye
What is protected is the interest of the
individual in not being made to appear before
the public in an objectionable false light or
false position (AQUINO, Torts and Damages,
supra at 489).
NOTE: In many cases, the publicity given to
the plaintiff is defamatory, hence an action for
libel is also warranted; the action for invasion
of privacy will afford an alternative remedy
(Id. at 490).
ort of Pu
PUTTING ANOTHER IN FALSE LIGHT
V. DEFAMATION
TORT OF PUTTING
ANOTHER IN FALSE DEFAMATION
LIGHT
As to Gravamen of Claim
Not the reputational harm Reputational harm.
but rather the
embarrassment of a acted with commendable motives and a clear
person being made into
something he is not (Id. at
490).
As to Publication
The statement should be Publication is
actually made in public. satisfied if a letter is
sent to a third person.
As to the Defamatory Character of the
Statements
Defendant may still be held What is published
liable even if the lowers the esteem in
TORT OF PUTTING
ANOTHER IN FALSE DEFAMATION
LIGHT
statements tell something which the plaintiff is
good about the plaintiff. held (Id. at 491).
d. Commercial Appropriation of Likeness
The tort of commercial appropriation of
likeness has been held to protect various
aspects of an individual’s identity from
commercial exploitation: name, likeness,
achievements, identifying characteristics,
actual performances and fictitious characters
created by a performer (Id. at 491).
With respect to celebrities, however, the right
of publicity is often treated as a separate right
that overlaps by us distinct from the right of
privacy. Celebrities who file actions to protect
their right to publicity do so to protect their
economic interest (Id. at 492).
2. INTERFERENCE WITH FAMILY AND
OTHER RELATIONS
It may be:
a. Alienation of affection of spouse
b. Disturbing family relations (Id. at 493-494).
Alienation of Affection
This consists of depriving one spouse of the
affection, society, companionship and comfort of
the other. It extends to all cases of wrongful
interference in the family affairs of others
whereby one spouse is induced to leave the other
spouse or to conduct himself or herself in such a
way that the comfort of married life is destroyed
(Id. at 494).
Alienation by In-laws
If the interference is by the parents of the spouse
on the assumption that the wife was ill-treated, it
may be reasonably presumed that they have
case of want of justification may be justly shown
before they should be held responsible (Id. at
495).
Elements:
1. A valid marriage;
2. Wrongful conduct by the defendant with the
plaintiff’s spouse;
3. Loss of affection or consortium; and
4. A causal relation between the defendant’s
conduct and the deprivation of affection.
The requirement of malice is necessary if the
defendant is not a relative of a spouse whose
 affection was said to have been alienated (Id. at
496). “EMOTIONAL DISTRESS” TORT ACTION
V. DEFAMATION
Disturbing Family Relations
A person may be held liable if he disturbs family “EMOTIONAL
relations (CIVIL CODE, Art. 26). DISTRESS” TORT DEFAMATION
ACTION
The law recognizes the right of the parent to
advise the son or daughter: As to the Controlling Principle
a. When the advice was given in good faith, and
Properly belongs to the Calls for the application
results in separation, the act does not give
reactive harm principle of the relational harm
the injured party the right of action.
(which includes injuries principle (which includes
to individual emotional harm to social
b. Malice must be established, and it must
tranquility) (AQUINO, relationships in the
appear that defendant’s acts were the
Torts and Damages, community in the form of
controlling cause of the loss of affection to
supra at 507). defamation) (Id.).
recover damages (Tenchavez v. Escano,
G.R. No. L-19671, November 29, 1965).
TORTS WITH INDEPENDENT CIVIL
3. VEXATION AND HUMILIATION ACTIONS (CIVIL CODE, ART. 32, 33 AND
Vexation
34)
This refers to an act of annoyance or irritation that
causes distress or agitation (MVRS Publications, Independent Civil Actions include: (VD-FIN)
Inc. v. Islamic Da’wah Council of the Philippines, 1. Violation of civil and political rights (Art. 32);
Inc., et. al., G.R. No. 135306, January 28, 2003). 2. Defamation (Art. 33);
3. Fraud (Art. 33);
May Consist of: 4. Physical Injuries (Art. 33); and
a. Humiliation on Account of Personal 5. Neglect of duty by public officers (Art. 34)
Condition
Vexing or humiliating another on account of Basis of Liability
his religious beliefs, lowly station in life, place Two views:
of birth, physical defect, or other personal 1. Tolentino
condition (Art. 26(4), Civil Code). – The civil action which the Civil Code provisions
allow to be filed (particularly Article 33) is ex-
b. Intentional Infliction of Emotional delicto, that is, civil liability arising from delict.
Distress
Requisites: (MICE) 2. Caguioa
i. Plaintiff’s Mental distress was extreme – The liability sought to be enforced in
and severe; independent civil actions granted under Articles
ii. Conduct of the defendant was Intentional 32, 33 and 34 is not the civil liability arising from
or in reckless disregard of the plaintiff; crime. The basis is said to be tortuous actions
iii. Causal connection between defendant’s more of the nature of culpa aquiliana and
conduct and plaintiff’s mental distress; therefore, separate and distinct from civil liability
and arising from crime.
iv. Conduct was Extreme and outrageous –
beyond all possible bounds of decency, It is believed that the latter view is the better view
regarded as atrocious, and utterly because even the Report of the Code Commission
intolerable in civilized society (MVRS cited in Madeja v. Caro refers to civil actions that are
Publication, Inc. v Islamic Da’wah absolutely separate and independent (G.R. No. L-
Council, G.R. No. 135306, January 28, 51183, December 21, 1983; AQUINO Torts and
2003). Damages, supra at 532).

Illustration: Emotional distress caused by 1. VIOLATION OF CIVIL AND POLITICAL

discrimination against a person because of
his physical defect.
NOTE: Plaintiff cannot recover merely
because of hurt feelings (MVRS Publication,
Inc. v Islamic Da’wah Council, G.R. No.
135306, January 28, 2003).
RIGHTS (CIVIL CODE, ART. 32)
REASON:
a. In most cases, the threat to freedom originates
from the abuses of power by government officials
and peace officers. But frequently, no criminal
action is filed by the prosecuting attorney.
b. The requirement of proof beyond reasonable
doubt often prevented the appropriate
punishment. An independent civil action would
afford the proper remedy by a preponderance of
evidence.
c. Direct and open violations of the Revised Penal
Code trampling upon the freedom named are not
so frequent as those subtle, clever and indirect
ways which do not come within the pale of the
penal law (AQUINO, Torts and Damages, supra
at 536).
Committed by:
1. Public officer or employee; or,
2. Any private individual.
Judges are not liable under this Article unless the act
or omission is a crime. This is because in the case of
a crime, it is well known that a person criminally liable
is also civilly liable (PARAS, Persons and Family
Relations, at 202). Also, Commissioners may not be
held liable under Art. 32 for they are in the same
category as a judge (Serrano v. Muñoz Motors, Inc.,
G.R. No. L-25547, November 27, 1967).
NOTE: An individual can hold a public officer
personally liable for damages on account of an act or
omission that violates a constitutional right only if it
results in a particular wrong or injury (Vinzons-Chato
v. Fortune Tobacco Corporation, G.R. No. 141309,
June 19, 2008).
The failure to perform a public duty can constitute an
individual wrong only when a person can show that,
in the public duty, a duty to himself as an individual is
also involved, and that he has suffered a special and
peculiar injury by reason of its improper performance
or non-performance (Id.).
Motive or Bad Faith is Not Necessary
It is not necessary that the defendant under this
Article (32) should have acted with malice or bad
faith, otherwise, it would defeat its main purpose,
which is the effective protection of individual rights. It
suffices that there is a violation of the constitutional
right of the plaintiff (Vinzons-Chato v. Fortune
Tobacco Corporation, G.R. No. 141309, June 19,
2007).
Art. 32 also applies to military officials and officers.
(Aberca v. Fabian Ver, G.R. No. 69866, April 15,
1988).
Art. 32 allows an independent civil action, whether or
not a crime has been committed, with indemnification
for moral and exemplary damages in addition to other
damages ((PARAS, Persons and Family Relations,
supra at 204).
Art. 32 speaks of an officer or employee or person
"directly or indirectly" responsible for the violation of
the constitutional rights and liberties of another. Thus,
it is not the actor alone (i.e., the one directly
responsible) who must answer for damages under
Art. 32; the person indirectly responsible has also to
answer for the damages or injury caused to the
aggrieved party (Aberca v. Ver, G.R. No. 69866, April
15, 1988; Silahis International Hotel, Inc. v. Soluta,
G.R. No. 163087, February 20, 2006).
Invalid Defenses:
a. State Immunity
Reason: Officers do not act within the ambit of
their powers if they violate the constitutional
rights of persons (AQUINO, Torts and
Damages, supra at 504);
b. Suspension of the writ of habeas corpus
cannot be used as a defense in cases involving
Article 32 of the Civil Code (Aberca v. Ver, G.R.
No. 69866, April 15, 1988).
ARTICLE 32 V. ADMINISTRATIVE CODE
ARTICLE 32 ADMINISTRATIVE CODE
Liability of public Lays down the rule on the civil
officers for liability of superior and
violation of rights subordinate public officers for
and liberties of a acts don in the performance of
person their duties
Malice and bad Presence of malice and bad
faith are not faith is necessary
required
Covers specific Covers the general acts done in
acts that may the performance of official
give rise to an duties
action for
damages
(Vinzons-Chato v. Fortune Tobacco Corporation,
supra, 2007)
In addition to the Bill of Rights provisions, Art. 32
refers to:
1. Freedom of Suffrage;
2. Freedom from being forced to confess guilt, or
from being induced by a promise of immunity or
reward to make such confession, except when
the person confessing becomes a state witness
(PARAS, Persons and Family Relations, supra at
196).
2. DEFAMATION (CIVIL CODE, ART. 33)
Defamation, which includes libel and slander,
means the offense of injuring a person’s
character, fame, or reputation through false and
malicious statements (MVRS Publications, Inc. v.
Islamic Da’wah Council of the Phils., Inc., G.R.
No. 135306, January 28, 2003).
It is that which tends to injure reputation or
diminish the esteem, respect, good will, or
confidence in the plaintiff or to excite derogatory
feelings or opinions about the plaintiff (Id.).
Reason for liability: The desire to protect the
reputation of every individual (AQUINO, Torts
and Damages, supra at 549).
It is an invasion of a relational interest since it
involves the opinion which others in the
community may have, or tend to have, of the
plaintiff (Id.).
Requisites for One to be Liable for
Defamatory Imputations: (DIMP)
a. It must be Defamatory;
The statement is defamatory as a matter of
law where imputation is the commission of a
crime; the defamation is so plain that the
charge is automatically deemed libelous.
If the statement is not defamatory as a matter
of law, the Court must then make a
determination on the defamatory capability of
the statement (AQUINO, Torts and
Damages, supra at 551).
b. The victim must be Identifiable;
He must establish that the defamatory
statement referred to him although it is not
necessary that he be named. The plaintiffs
include both natural and juridical persons.
It is insufficient that the offended party
recognized himself as the person attacked or
defamed. It must be shown that at least a
third person could identify him as the object
of the libelous publication (Id. at 566).
c. It must be Malicious; and
Existence of malice in fact may be shown by
extrinsic evidence that the defendant bears a
grudge against the offended party, or that
there is rivalry or ill feeling between them (Id.
at 562).
d. It must be given Publicity.
It is not required that publication is made in
the media publication. Dissemination to a
number of people is, however, not required
and communication to a single individual is
sufficient (Id. at 561).
Test in Determining the Defamatory Character
of the Words Used
A charge is sufficient if the words are calculated
to induce hearers:
a. To suppose and understand that the
person/s against whom they were uttered
were guilty of a certain offense;
b. Are sufficient to impeach their honesty, virtue
or reputation; or
c. To hold the person/s up to public ridicule
(Sazon v. CA, G.R. No. 120715, March 29,
1996).
NOTE: The judge must consider the allegedly
libelous passages in the context of the entire
article and evaluate the words as they are
commonly understood. Put another way, he must
put himself in the shoes of the ‘average reader’
and decide whether such a reader would interpret
the message as libelous (AQUINO Torts and
Damages, supra at 552).
Illustrations:
a. The fact that the language is offensive to the
plaintiff does not make it actionable by itself
(MVRS Publications, Inc., et al. v. Islamic
Da’wah Council of the Philippines, Inc., et al.,
supra).
b. Personal hurt or embarrassment or offense,
even if real, is not automatically equivalent to
defamation. It is the community, not personal
standards, which is taken into account in
evaluating any allegations of libel and any
claims for damages on account thereof. This
is known as the community standard (GMA
Network and Vidal v. Bustos, G.R. No.
146846, October 17, 2006).
c. Alleged defamatory statements should be
taken in their entirety and the statements
should not be interpreted by taking the words
uttered one by one out of context and giving
them twisted meanings (AQUINO Torts and
Damages, supra at 557).
d. Slight unintentional errors will be excused
(Flor v. People, G.R. No. 139987, March 31,
2005).
e. Mere assertion that a person failed or refused
to perform a contractual obligation does not,
in and on itself, injure the person’s business
reputation or deprive him of public
confidence (Insular Life Assurance Co., Ltd.
V. Serrano, G.R. No. 163255, June 22,
2007).
f. In civil action for damages, no liability will
result if the defamatory matter is not seen
 or heard by anyone except the defendant
and the plaintiff. Damages to character or
reputation of the plaintiff is the estimate
which others hold him and not what he
himself thinks (People v. Silvela, G.R. No. L-
10610, May 26,1958).
Presumption of Malice
GENERAL RULE: Malice in law as contemplated
in Article 354 of the Revised Penal Code every
defamatory imputation is presumed to be
malicious, even if it is true, if no good intention or
justifiable motive for making it is shown (AQUINO
Torts and Damages, supra at 565).
EXCEPTIONS:
a. A private communication made by any
person to another in the performance of any
legal, moral or social duty; and
b. A fair and true report, made in good faith,
without any comments or remarks, of any
judicial, legislative or other official
proceedings which are not of confidential
nature, or of any statement, report, or speech
delivered in said proceedings or of any other
act performed by public officers in the
exercise of their functions (REVISED PENAL
CODE, Art. 354).
Cases
a. Once it is established that the article is of a
privileged character, the onus of proving
actual malice rests on the plaintiff who must
then convince the court that the offender was
prompted by malice or ill will. When this is
accomplished the defense of privilege
becomes unavailing (Santos v. Court of
Appeals, G.R. No. L-45031, October 21,
1991).
b. To be considered malicious, the libelous
statement must be shown to have been
written or published with knowledge that they
are false or in reckless disregard of whether
they are false or not. Reckless disregard of
what is false or not means that the author
or publisher entertains serious doubt as to
the truth of the publication, or that he
possesses a high degree of awareness of
their probable falsity (Villanueva v. Philippine
Daily Inquirer, et. al., G.R. No. 164437, May
15, 2009).
c. Every citizen of course has the right to enjoy
a good name and reputation, but we do not
consider that the respondents, under the
circumstances of this case, had violated said
right or abused the freedom of the press.
Newspapers should be given such leeway
and tolerance as to enable them to
courageously and effectively perform their
important role in our democracy. In the
preparation of stories, press reporters and
[editors] usually have to race with their
deadlines; and consistently with good faith
and reasonable care, they should not be held
to account, to a point of suppression, for
honest mistakes or imperfection in the choice
of words (Arafiles v. Philippine Journalists
Inc., G.R. No. 150256, March 25, 2004).
Kinds of Malice:
a. Malice in Law is a presumption of law. It
dispenses with the proof of malice when
words that raise the presumption are shown
to have been uttered. It is also known as
constructive malice, legal malice, or implied
malice (AQUINO, Torts and Damages, supra
at 564).
b. Malice in Fact is a positive desire and
intention to annoy and injure. It is also called
express malice, actual malice, real malice,
true malice, or particular malice (Yuchengco
v. The Manila Chronicle Publishing
Corporation, G.R. No. 184315, November
25, 2009).
CYBER LIBEL
Unlawful or prohibited acts of libel as defined in
Art. 355 of the Revised Penal Code, as amended,
committed through a computer system or any
other similar means which may be devised in the
future (Sec. 4(c)(4), R.A. No. 10175).
GROUP LIBEL
Requisites: (ABS)
a. Libel directed Against a fairly large group;
b. Libel can reach Beyond the mere collectivity
to do damage to an individual group
member’s reputation; and
c. The statement is so Sweeping and all-
embracing as to apply to every individual in
that group or class so that he can bring the
action separately if necessary (Newsweek,
Inc., v. IAC, G.R. No L-63559, May 30, 1986).
Declarations made about a large class of people
cannot be interpreted to advert to an identified or
identifiable individual. Absent circumstances
specifically pointing or alluding to a particular
member of a class, no member of such class has
a right of action without at all impairing the equally
demanding right of free speech and expression,
as well as of the press, under the Bill of Rights
(MVRS Publications, Inc., et al. v. Islamic Da’wah
Council of the Philippines, Inc., et al., supra).
An individual Muslim has a reputation that is
personal, separate and distinct in the community.
Each reputation is personal in character to every
person. Together, the Muslims do not have a
single common reputation that will give them a
common or general interest in the subject matter
of the controversy (Id.).
If the defamatory statements were directed at a
small, restricted group of persons, the applied to
any member of the group, and an individual
member could maintain an action for defamation.
(Id.).
Deceased
Relatives of the deceased can file an action for
damage to the reputation of the latter. Article 353
of the Revised Penal Code expressly provides
that defamatory statements include those which
tend to blacken the memory of one who is dead
(AQUINO, Torts and Damages, supra at 573).
Corporation
Article 353 of the Revised Penal Code expressly
recognizes that a juridical person can be a victim
of libel. Hence, a corporation can be a
complainant of a libel case. The corporate can file
a case if its reputation as an entity was defamed
(Id.).
Defenses
1. Privileged Statements
Two Kinds of Privileged Communication:
a. Absolutely Privileged – not actionable
even if the author acted in bad faith
(Manila Bulletin Publishing Corp. v.
Domingo, G.R. No. 170341, July 5,
2017).
Illustrations:
i. Allegations and averments in pleadings
filed in court as long as relevant and
pertinent to the issues;
ii. A member of the Congress is exempt
from liability for any speech or debate in
the Congress or any Committee thereof
(CONST. Art. VI, Sec. 11).
b. Qualifiedly Privileged – not actionable
unless found to have been made without
good intention or justifiable motive
(Manila Bulletin Publishing Corp. v.
Domingo, G.R. No. 170341, July 5,
2017).
Classes:
i. A private communication made by any
person to another in the performance of
any legal, moral or social duty;
ii. A fair and true report, made in good faith
without any comments or remarks, of any
judicial, legislative or other official
proceedings which are not of confidential
nature, or of any statement, report or
speech delivered in said proceedings, or
of any other act performed by public
officers in the exercise of their functions;
iii. Fair commentaries on matters of public
concern (Yuchengco v. The Manila
Chronicle Publishing Corporation, G.R.
No. 184315, November 25, 2009).
A complaint against public officials addressed
to proper authorities is qualifiedly privileged
(AQUINO, Torts and Damages, supra at 546).
Test: Good Faith
Even if the statement is untrue, the same may
not be considered defamatory under the said
test (Ponce v. Legaspi, G.R. No. 79184, May
6, 1992).
2. Private Communication (REVISED PENAL
CODE, ART. 34)
Requisites: (DAG)
i. the person who made the
communication had a legal, moral, or
societal Duty to make the
communication, or at least, had an
interest to protect, which interest may
either be his own or of the one to whom
it is made;
ii. the communication is Addressed to an
officer or a board, or superior, having
some interest or duty in the matter, and
who has the power to furnish the
protection sought; and
iii. the statements in the communication are
made in Good faith and without malice
(AQUINO, Torts and Damages, supra at
585).
3. Doctrine of Fair Comment (REVISED
PENAL CODE, ART. 34)
Fair commentaries on matters of public
interest are privileged and constitute a valid
defense in an action for libel or slander. The
discreditable imputation directed against a
public person in his public capacity, is not
necessarily actionable. In order that such
discreditable imputation to a public official
may be actionable, it must either be a false
allegation of fact or a comment based on
false supposition (Borjal v. CA, G.R. No.
126466, January 14, 1999).
The doctrine of fair comment means that
while in general every discreditable
imputation publicly made is deemed false,
because every man is presumed innocent
 until his guilt is judicially proved, and every
false imputation is deemed malicious,
nevertheless, when the discreditable
imputation is directed against a public person
in his public capacity, it is not necessarily
actionable. In order that such discreditable
imputation to a public official may be
actionable, it must either be a false allegation
of fact or a comment based on a false
supposition. If the comment is an expression
of opinion, based on established facts, then
it is immaterial that the opinion happens to be
mistaken, as long as it might reasonably be
inferred from the facts (Manila Bulletin
Publishing Corp. v. Domingo, supra).
3. FRAUD (CIVIL CODE, ART. 33)
There is fraud when, through insidious words or
machinations of one of the contracting parties,
the other is induced to enter into a contract which,
without them, he would not have agreed to
(Tankeh v. Development Bank of the Philippines,
G.R. No. 171428, November 11, 2013).
Elements of Deceit: (FFKAIS)
a. Defendant made False representation to the
plaintiff through:
i. Written or spoken words, or
ii. Conduct;
b. The representation must be one of Fact;
REASON: The view that propositions of law
are generally matters of public record to
which the plaintiff and defendant have equal
access.
c. Defendant Knows that the representation is
false or is reckless about whether it is false;
It is also enough that the defendant has no
sufficient basis of information to make
representation or what is known as scienter;
d. Plaintiff must have Acted on the false
representation;
e. Defendant must have Intended that the false
representation should be acted on; and
f. Plaintiff Suffered damage as a result of acting
on the false representation (AQUINO, Torts
and Damages, supra at 602).
Rule on Opinion
GENERAL RULE: A mere matter of opinion does
not signify fraud (Id. at 603).
EXCEPTION: When made by an expert and the
other party relied on the former’s special
knowledge (CIVIL CODE, Art. 1341).
Half-Truths
It is actionable if it is such a partial and
fragmentary statement of fact, as that the
withholding of that which is not stated makes that
which is stated absolutely false (AQUINO, Torts
and Damages, supra at 602).
4. PHYSICAL INJURIES (CIVIL CODE, ART.
33)
Battery – an intentional infliction of a harmful or
offensive bodily contact (AQUINO, Torts and
Damages, supra at 605).
Offensive Bodily Contact – offends a
reasonable person’s sense of dignity even
though it is intended only as a joke or a
compliment (Id.).
Assault – intentional conduct by one person
directed at another placing the latter in
apprehension of immediate bodily harm or
offensive act. It includes bodily injuries causing
death (Id.).
Physical injuries resulting from negligence or
imprudence is not included in Article 33; they are
already covered by Article 2176. Thus, the crime
of homicide due to reckless imprudence is not
covered by Article 33, but by Article 2176 of the
Civil Code (Id. at 608).
5. NEGLECT OF DUTY BY POLICE
OFFICERS (CIVIL CODE, ART. 34)
Intended to afford a remedy against police
officers “who connive with bad elements, are
afraid of them or are simply indifferent to duty”
(AQUINO, Torts and Damages, supra at 608).
Subsidiary Liability of Cities and
Municipalities imposed so that they will
exercise:
a. Great care in selecting conscientious and
duly qualified policemen; and
b. Supervision over them in the performance of
their duties (Id. at 609).
UNJUST ENRICHMENT
Every Person who, through an act of performance by
another, or any other means, acquires or comes into
possession of something at the expense of the latter
without just or legal ground, shall return the same to
him (Art. 22, Civil Code) This provision contemplates
what is known as accion in rem verso (AQUINO,
Torts and Damages, supra at 757).
An accion in rem verso is considered merely an
auxiliary action, available only when there is no other
remedy on contract, quasi-contract, crime, and quasi-
delict. If there is an obtainable action under any other
institution of positive law, that action must be resorted
to, and the principle of accion in rem verso will not lie
(Shinryo [Philippines] Company, Inc., v. RRN
Incorporated, G.R. No. 172524, 20 October 2010).
 Civil Code as one of the reasons why there is civil
In order that accion in rem verso may prosper, the liability ex delicto if a special criminal law is violated
essential elements must be present: because it is clear from the said provision that “every
1. That the defendant has been enriched; person who, contrary to law, willfully or negligently
2. That the plaintiff has suffered a loss; causes damage to another, shall indemnify the latter
3. That the enrichment of the defendant is without for the same.”
just or legal ground; and
4. That the plaintiff has no other action based on Rule on proximate cause in quasi-delict cases is
contract, quasi-contract, crime or quasi-delict. applicable to cases involving civil liability arising from
delict (CIVIL CODE, Art. 2202).
Even when an act or event causing damage to
another’s property was not due to the fault or
NO CIVIL LIABILITY CIVILLY LIABLE BUT
negligence of the defendant, the latter shall be liable
FOR THE FOLLOWING NOT CRIMINALLY
for indemnity if through the act or even he was
OFFENSES: LIABLE
benefited (CIVIL CODE, Art. 23).
1. Violation of 1. Persons exempt
Illustration: A’s cattle was saved after having been ordinances, game from criminal liability
driven by flood to B’s cultivated highland. A should laws, and traffic (REVISED PENAL
indemnify B for the destruction of the latter’s crops. rules when no one is CODE, Art. 12);
hurt; and 2. Employees
2. Treason, rebellion, subsidiarily liable
espionage, piracy, under Articles 102
CIVIL LIABILITY contempt, gambling and 103 of the
ARISING FROM and betting, infidelity
in the custody of
Revised
Code;
Penal

DELICT prisoners, abortion 3. Relatives

practiced by the mentioned in Article
woman herself and 332 of the Revised
other similar crimes. Penal Code
CIVIL LIABILITY ARISING FROM DELICT involving theft,
BASIS: Every person criminally liable for felony is swindling or
also civilly liable (REVISED PENAL CODE, Art. 100). malicious mischief;
4. When accused is
GENERAL RULE: Crimes give rise to both criminal acquitted because
and civil liability (Dual Character of Crimes) of reasonable
a. Criminal Liability – An offense against the doubt;
State. 5. In cases of
b. Civil Liability – An offense against the private independent civil
person injured (DE LEON, Torts and Damages, actions (CIVIL
supra at 520). CODE, Art. 32, 33,
and 34);
6. In civil actions under
SPECIAL CRIMINAL LAWS Article 2177 of the
The dual character of crimes is present not only in Civil Code; and
felonies defined under the Revised Penal Code but 7. When acquitted in a
also in cases governed by special laws such as: criminal action but
a. R.A. 9262 – Anti-Violence Against Women and the court rendered a
Their Children Act 2004; civil liability.
b. B.P. 22 – Bouncing Checks Law; and
c. Rule 10 of A.M. No. 09-6-8-SC-Rules of
Procedure of Environmental Cases. NOTE: It should be pointed out that the presence of
civil liability in offenses is not determined by the fact
What gives rise to civil liability is the obligation to that the crime is public or private. In other words,
repair or to make whole the damage caused to there is civil liability even if the offense is a public
another by reason of his act or omission, whether offense, as in the case of bigamy (AQUINO, Torts
done intentionally or negligently and whether or not and Damages, supra at 613).
punishable by law (Nuguid v. Nicdao, G.R. No.
150785, September 15, 2006). In connection
therewith, the SC, in Banal v. Hon. Tadeo (G.R. No.
78911-25, December 11, 1987) cited Article 20 of the
PERSONS LIABLE damages in the criminal case can file another
a. Principal; case under Article 33 of the Civil Code (People v.
b. Accomplice; and Bayotas, G.R. No. 102007, September 2, 1994).
c. Accessories (REVISED PENAL CODE, Art. 108,
109 and 110). Illustration: In case of self-defense, the
defendant is privileged to respond with
Two or More Persons Civilly Liable for a Felony reasonable amount of force in self-defense. It is
If there are two or more persons civilly liable for a the objective reasonableness of his conduct that
felony, the court will determine the specific amount of relieves him from liability.
liability of each of these persons. The amount of
damages to be awarded must be apportioned ARTICLE 30 OF THE CIVIL CODE IN
according to their respective responsibilities to be RELATION TO RULE 111, SECTION 3 OF
paid by them solidarily within their respective class RULES OF COURT
and subsidiarily for the others of a different class
(Garces v. People, G.R. No. 173858, July 17, 2007). ACTION AND EFFECT
WHEN FILED
SEPARATE AND SUBSIDIARY LIABILITY When Civil Plaintiff is merely required to
The court may fix the amount for which the principal Action is filed prove his case by mere
is primarily liable and determine a separate amount ahead of preponderance of evidence.
of liability of the accessory. Each of them shall be Criminal Action
subsidiarily liable for the other’s share in case of the
latter’s insolvency (AQUINO, Torts and Damages, The pending civil action shall be
supra at 614). When Criminal suspended in whatever stage it
Action is may be found, until final
WHAT IS INCLUDED IN CIVIL LIABILITY: subsequently judgment in the criminal action
a. Restitution (REVISED PENAL CODE, Art. 105); commenced has been rendered.
b. Reparation (REVISED PENAL CODE, Art. 106);
and The evidence presented and
c. Indemnification (REVISED PENAL CODE, Art. admitted in the civil action shall
107). be deemed automatically
When
reproduced in the criminal
application for
EXTINCTION AND SURVIVAL OF action, without prejudice to the
consolidation
LIABILITY admission of the additional
is granted
evidence that any party may
Civil liability under the Revised Penal Code shall be
wish to present. The criminal
extinguished in the same manner as obligations in
and civil action shall be tried
accordance with Civil Law (REVISED PENAL CODE,
and decided jointly.
Art. 112).

EFFECT OF PARDON ART. 30 V. ART. 31

Pardon does not erase civil liability (Monsanto v. ARTICLE 30 ARTICLE 31
Factoran, G.R. No. 78239, February 9, 1989). It is not
one of grounds recognized under the Civil Code that This refers to a separate This refers to an
extinguishes civil liability (AQUINO, Torts and civil action which is independent civil action
Damages, supra at 626). based on the criminal based on an obligation
liability of the defendant. arising from other
EFFECT OF DEATH: sources such as law,
contracts, quasi-
a. Death after Final Judgment: contracts and quasi-
Extinguishes criminal liability of the person liable
delicts.
but will not extinguish the civil liability (Id. at 624).

b. Death before Final Judgment: VIOLATIONS COMMITTED BY PUBLIC

GENERAL RULE: Defendant is relieved from
criminal and civil liability arising from the offense
(Id.).
EXCEPTIONS: The aggrieved party in a libel and
physical injuries case who initially opted to claim
OFFICERS
GENERAL RULE: A public officer is not liable for
damages which a person may suffer arising from the
just performance of his official duties and within the
scope of his assigned task.
EXCEPTION: A public officer may be validly sued on It is not necessary for the defective road or street to
his/her private capacity for acts done in the course of belong to the province, city, or municipality for liability
the performance of the functions of the office, where to attach. The article only requires that either control
said public officer: or supervision is exercised over the defective road or
1. Acted with malice, bad faith, or negligence; or street (Guilatco v. City of Dagupan, G.R. No. 61516,
2. Violated a constitutional right of the plaintiff March 21, 1989).
(Vinzons-Chato v. Fortune Tobacco Corporation,
supra, 2007). The local government unit cannot escape liability by
claiming that its officials do not have knowledge of the
TWO-KINDS OF DUTY: existence of excavations on its road; the obligation to
1. Public Duty; and, make the road safe is a continuing obligation
2. Duty Owing to Particular Individuals. (Municipality of San Juan v. CA, G.R. No. 121920,
August 9, 2005) Under Sec. 149 of the LGC, the
When what is involved is a duty owing to the public in sangguiniang bayan shall regulate the drilling and
general, an individual cannot have a cause of action excavations of the ground (AQUINO, Torts and
for damages against the public officer, even if though Damages, supra at 738).
he may have been injured by the action or inaction of
the officer. In such a case, there is damage to the OWNER OF MOTOR VEHICLE (CIVIL
individual but no wrong to him (Vinzons-Chato v. CODE, ART. 2184)
Fortune Tobacco Corporation, supra, 2008). In Art. 2184, the New Civil Code, declares that in
motor vehicle mishaps, the owner is solidarily liable
EXCEPTION: When the complaining individual with his driver, if the former, who was in the vehicle,
suffers a particular or special injury on account of the could have, by the use of due diligence, prevented
improper or non-performance of the public duty (Id.). the misfortune xxx if the owner was not in the motor
vehicle, the provisions of Art. 2180 are applicable
An independent civil action may be filed for the (JURADO, Civil Law Reviewer, (2019) p. 1271
liability of city or municipal police force who refuses [hereinafter, JURADO, Civil Law Reviewer]).
or fails to render aid or protection. Primary liability is
against the member of the police force who refuses
or fails to render such protection. And subsidiary ART. 2184 ART. 2180
liability is imposed on the city or municipality
Owner of the vehicle Defense of due
concerned in case of insolvency (CIVIL CODE ART.
cannot avail himself of diligence and
34, PARAS, Persons and Family Relations, supra at
the defense of due supervision of his
223).
diligence in the selection employees is available
and supervision of his
This Article 34 does not grant to the government the
employees
defense of due diligence in the selection and
supervision of the policemen (Id.). Owner is solidarily liable Owner is not solidarily
with his driver. liable with his driver.
Since Art. 34 speaks merely of city or municipal
police, it would seem it does not apply to the He may, after payment, He can, after payment,
Philippine National Police Force and to the National demand reimbursement demand from the driver
Government (Id.). from the driver of ½ of reimbursement of the
the entire amount he has entire amount which he
PROVINCES, CITIES, AND paid (Art. 1217, NCC) has paid (Art. 1218,
MUNICIPALITIES (CIVIL CODE, ART. NCC
2189) (Id.).
The liability of public corporations for damages
arising from injuries suffered by pedestrians from the VIOLATIONS OF DATA PRIVACY
defective conditions of roads is expressed in (Art. 32) Having an expectation of informational privacy is not
the Civil Code (AQUINO, Torts and Damages, supra necessarily incompatible with engaging in
at 735). cyberspace activities, including those that occur in
online social network (Vivares v. St. Theresa’s
Relatedly, Sec. 24 of R.A. No. 7160 provides that College, G.R. No. 202666, September 29, 2014).
local government units and their officials are not
exempt from liability for death or injury to persons or It is through the availability of said privacy tools that
damage to property. many online social network users are said to have a
subjective expectation that only those to whom they
grant access to their profile will view the information
they post or upload thereto. Before one can have an
expectation of privacy in his or her OSN activity, it is
first necessary that said user manifest the intention to
keep certain posts private, through the employment
of measures to prevent access thereto or limit its
visibility. And this intention can materialize in
cyberspace through the utilization of the OSN’s
privacy tools (Id.)
There is no fundamental right to acquire another’s
personal data (Disini v. Secretary of Justice, G.R. No.
20333, February 11, 2014).
STRICT LIABILITY
There is strict liability if one is made liable
independent of fault, negligence or intent after
establishing certain facts specified by law. Strict
liability tort can be committed even if reasonable care
was exercised regardless of the state of mind of the
actor at that time (AQUINO, Torts and Damages,
supra at 742).
TYPES:
1. ANIMALS (CIVIL CODE, ART. 2183)
GENERAL RULE: The possessor of an animal
or whoever may make use of the same is
responsible for the damages which it may cause
although it may escape or be lost.
EXCEPTIONS: When the damage was caused:
a. By force majeure; or
b. By the person who suffered the damage
(AQUINO, Torts and Damages, supra at
743).
NOTE: The law used the generic term animal. It
covers all kinds of animals (PINEDA, Torts and
Damages, supra at 122).
This is applicable whether the animal is domestic,
domesticated or wild (Vestil v. IAC, G.R. No.
74431, November 6, 1989).
NOTE: Wild animals are possessed only while
they are under one’s control; domesticated or
tame animals are considered domestic or tame,
if they retain the habit of returning to the premises
of the possessor (CIVIL CODE, Art. 560).
Possessor or user is still liable even if damage is
caused by the negligence or fault of third person
unless equated with force majeure (AQUINO,
Torts and Damages, supra at 743).
2. FALLING OBJECTS (CIVIL CODE, ART.
2193)
The head of a family that lives in a building or a
part thereof is responsible for damages caused
by things thrown or falling from the same.
Head of the family is not limited to the owner of
the building, and it may even include the lessee
thereof (Dingcong v. Kanaan, G.R. No. 47033,
April 25, 1941).
This does not exempt cases involving force
majeure (AQUINO, Torts and Damages, supra at
745).
The head of the family may recover from the
person who caused the damage. The liability is
solidary (CIVIL CODE, Art. 2194).
3. LIABILITY OF EMPLOYERS (CIVIL CODE,
ART. 1711)
GENERAL RULE: Owners of enterprises and
other employers are liable to pay for the death or
injuries to their employees, even if the cause is
purely accidental.
EXCEPTION: If the mishap was due to the
employee’s own notorious negligence, or
voluntary act or drunkenness.
EXCEPTION TO EXCEPTION: When the
employee’s lack of due care only contributed to
his death or injury, the employer shall be liable for
compensation but the same shall be equitably
reduced.
When the plaintiff's negligence was the
immediate and proximate cause of his injury, he
cannot recover damages. But if his negligence
was only contributory, the immediate and
proximate cause of the injury being the
defendant's lack of due care, the plaintiff may
recover damages, but the courts shall mitigate
the damages to be awarded (Travel & Tours
Advisers, Inc. v. Cruz, Sr., G.R. No. 199282,
March 14, 2016).
Rules on Employer’s Liability for Injuries
caused by Fellow-worker:
a. If the death or injury is due to the negligence
of a fellow-workman the latter and the
employer shall be solidarily liable for
compensation; and
b. If a fellow-worker’s intentional or malicious
act is the only cause of the death or injury,
the employer shall not be answerable unless
it should be shown that the latter did not
exercise due diligence in the selection or
supervision of the plaintiff’s fellow-worker
(CIVIL CODE, Art. 1712).

4. NUISANCE (CIVIL CODE, ART. 694)
Any act, omission, establishment, business,
condition of property, or anything else which:
(ISA-HO)
a. Injures or endangers the health or safety of
others;
b. Shocks, defies or disregards decency or
morality;
c. Annoys or offends the senses;
d. Hinders or impairs the user of property; or
e. Obstructs or interferes with the free passage
of any public highway or street, or any body
of water.
GENERAL RULE: Everyone is bound to bear the
habitual or customary inconveniences that result
from the proximity of others, and so long as this
level is not surpassed, he may not complain
against them (Velasco v. Manila Electric Co.,
G.R. No. L-18390, August 6, 1971).
EXCEPTION: If the prejudice exceeds the
inconveniences that such proximity habitually
brings, the neighbor who causes such
disturbance is held responsible for the resulting
damage, being guilty of causing nuisance (Id.).
Nuisance is either public or private. A public
nuisance affects a community or neighborhood or
any considerable number of persons, although
the extent of the annoyance, danger or damage
upon individuals may be unequal. A private
nuisance is one that is not included in the
foregoing definition (CIVIL CODE, Art. 695).
A private nuisance, or one "that is not included in
the foregoing definition" which, in jurisprudence,
is one which "violates only private rights and
produces damages to but one or a few persons
(Cruz v. Pandacan Hiker's Club, Inc., G.R. No.
188213, January 11, 2016).
A nuisance may also be classified as to whether
it is susceptible to a legal summary abatement, in
which case, it may either be: (a) a nuisance per
se, when it affects the immediate safety of
persons and property, which may be summarily
abated under the undefined law of necessity;
36or, (b) a nuisance per accidens, which
"depends upon certain conditions and
circumstances, and its existence being a
question of fact, it cannot be abated without due
hearing thereon in a tribunal authorized to decide
whether such a thing does in law constitute a
nuisance (Id.).
Liability of Successive Owner or Possessor
Every successive owner or possessor of property
who fails or refuses to abate a nuisance in that
property started by a former owner or possessor
is liable therefore in the same manner as the one
who created it (CIVIL CODE, Art. 696).
NOTE: An action to abate nuisance is
imprescriptible (AQUINO, Torts and Damages,
supra at 754).
Any person injured by a private nuisance may
abate it by removing, or if necessary, by
destroying the thing which constitutes the
nuisance, without committing a breach of the
peace or doing unnecessary injury. However, it is
indispensable that the procedure for extrajudicial
abatement of a public nuisance by a private
person be followed (CIVIL CODE, Art. 706).
5. PRODUCT LIABILITY BY
MANUFACTURERS (CIVIL CODE, ART.
2187)
Manufacturers and processors of foodstuffs,
drinks, toilet articles and similar goods shall be
liable for death or injuries caused by any noxious
or harmful substances used, although no
contractual relation exists.
Requisites: (MUNIF)
a. The defendant is the Manufacturer or
processor of foodstuff, drinks, toilet articles
and similar goods involved;
b. Plaintiff Used or consumed such product
unaware of the injurious condition of the
product;
c. The defendant used Noxious or harmful
substances in the manufacturing or
processing of the foodstuff, drink or toilet
articles and similar goods;
d. Plaintiff’s Injury or death was caused by the
product used or consumed; and
e. The Forms or kinds of damages suffered and
the amount thereof (PINEDA, Torts and
Damages, supra at 132).
Product and Service Liability
Product Liability Law
This governs the liability of manufacturers and sellers
for damages resulting from defective products
(AQUINO, Torts and Damages, supra at 760).
Liability for defective products may be based on
fraud, warranty, negligence or strict liability. The
action is based on quasi-delict; therefore, it
prescribes in four years. The allegations in the
complaint makes a reference to the reckless and
negligent manufacture of “adulterated food items
intended to be sold for public consumption.” The
vendee’s remedies are not limited to those prescribed
in Article 1567 of the Civil Code. The vendor could be
liable for quasi-delict under Article 2176, and an
action based thereon may be brought by the vendee
(Coca-Cola Bottlers Phils. v. CA, G.R. No. 110295;
October 18, 1993).
CONSUMER ACT
A law that is meant to protect the consumers by
providing for certain safeguards when they purchase
or use consumer products (R.A. No. 7394, Consumer
Act).
Alternative theories that may be used to justify
product liability:
1. Fraud or Misrepresentation
GENERAL RULE: Not all expressions of opinion
or usual exaggerations in trade are actionable
misrepresentations if they are established to be
inaccurate.
EXCEPTION: An act or practice shall be deemed
deceptive whenever the producer, manufacturer,
supplier or seller, through concealment, false
representation or fraudulent manipulation,
induces a consumer to enter into a sale or lease
transaction of any consumer product or service
(R.A. No. 7394, Art. 50).
2. Warranties
Enforcement of Warranty Rights – By
presentment of a claim. It is sufficient for the
purchaser to present to the immediate seller
either the warranty card or the official receipt
along with the product to be serviced or returned
to the immediate seller (R.A. No. 7394, Art. 68).
Subsidiary Liability of Retailer – Retailer is
subsidiarily liable under the warranty in case of
failure of both the manufacturer and distributor to
honor the warranty (AQUINO, Torts and
Damages, supra at 768).
Privity of contract is not necessary in successfully
pursuing an action for breach of warranty or in
enforcing the same under the Consumer Act (Id.
at 769).
Governing Law: The provisions of the Civil Code
on conditions and warranties shall govern all
contracts of sale with conditions and warranties
(R.A. No. 7394, Art. 67).
Warranty Under the Consumer Act
In addition to the Civil Code provisions on sale
with warranties, the following persons shall
govern the sale of consumer products with
warranty:
a. Set forth the terms of warranty in clear and
readily understandable language and clearly
identify himself as the warrantor;
b. Identify the party to whom the warranty is
extended;
c. State the products or parts covered;
d. State the warrantor will do in the event of a
defect, malfunction or failure to conform to
the written warranty and at whose expense;
e. State what the consumer must do to avail od
the rights which accrue to the warranty; and
f. Stipulate the period within which, after notice
of defect, malfunction or failure to conform
with the written warranty, the warrantor will
perform any obligation under the warranty
(R.A. No. 7394, Sec. 68).
3. Negligence
It is considered negligence per se if it is an act or
omission in violation of:
a. Those expressly prohibited by Product
Liability statutes;
b. Standards imposed by special laws, rules
and regulations of proper government
agencies with respect to Product Liability
Law (AQUINO, Torts and Damages, supra at
770).
Liability attaches if due care of an ordinarily
prudent man was not exercised in manufacturing,
packaging, marketing or distributing of the
product (Id. at 769).
4. Delict
Basis of Liability:
a. Criminal negligence under the Revised Penal
Code; and
b. Violation of any special law, even in the
absence of intent (Id. at 771).
5. Strict Liability
It is imposed on manufacturers under the
Consumer Act and privity of contract is not
required (Id. at 772).
It does not preclude an action based on
negligence (quasi-delict) for the same act of
using noxious or harmful substances (Id.).
Manufacturer
a. Includes any person, who manufactures,
assembles or processes consumer products;
and
b. Any person who attaches his own brand
name to the consumer products,
manufactured, assembled, or processed for
him (Id. at 780).
Defective Product or Service – when it does not
offer the safety that the consumer may rightfully
expect of it (R.A. No. 7394, Art. 97, par. 1).
Kinds of Defective Products: (MD-PA)
1. Manufacturing defect – resulting from
manufacture, assembly and erection;
2. Design defect – resulting from design;
3. Presentation defect – resulting from handling,
making up, presentation or packing of the
products; or
4. Absence of appropriate warning – resulting from
the insufficient or inadequate information on the
use and hazards of the products (AQUINO, Torts
and Damages, supra at 782).
NOTE: Design defect cannot be identified by
comparing the injury producing product with the
manufacturers plans or other unit. It can be
established by comparing it with standards
established by law or government agencies (Id. at
783).
Defect, which resulted because of the packaging and
presentation of the product, can be included under
the broad concept of manufacturing defect or design
defect (Id.).
Liability for Defective Product or Service:
1. Manufacturer
– liability shall be imposed upon manufacturers
independent of fault (R.A. No. 7394, Arts. 97 and
99).
2. Tradesman or Seller
– not generally liable for damages caused by
defective products under the “Consumer Act” or
“R.A. 7394”.
EXCEPTIONS:
a. It is not possible to identify the manufacturer,
builder, producer or importer;
b. The product is supplied, without clear
identification of the manufacturer, producer,
builder or importer;
c. He does not adequately preserve perishable
goods (R.A. No. 7394, Art. 98).
Consumer Expectation Test
Under the consumer expectation test a product may
be found defective in design, if the plaintiff
demonstrates that the product failed to perform as
safely as an ordinary consumer would expect when
used in an intended or reasonably foreseeable
manner (Barker v. Lull Engineering, S.F. No. 23519,
January 16, 1978).
Risk-Utility Test
States that a product is defective in design when the
foreseeable risks of harm posed by the product could
have been reduced or avoided by the adoption of
reasonable alternative design by the seller or other
distributor, or a predecessor in the commercial chain
of distribution, and the omission of the alternative
design renders the product not reasonably safe
(AQUINO, Torts and Damages, supra at 785).
Reasonable Alternative Design
The design shall be presumed safe unless, at the
time the product left the control of the manufacturer,
a practical and technically feasible design was
available that would have prevented the harm without
significantly impairing the usefulness, desirability, or
marketability of the product (Id. at 786).
Test under The Consumer Act
The Consumer Act adopts the “Consumer
Expectation Test” in determining what is defective (Id.
at 787).
Defenses
1. Manufacturer, builder, producer, or importer
shall not be liable when it proves:
a. That it did not place the product on the
market;
b. That although it did place the product on the
market such product has no defect; and
c. That the consumer or a third party is solely at
fault (R.A. No. 7394, Art. 97).
2. Supplier of the services shall not be liable
when it is proven:
a. That there is no defect in the service
rendered; and
b. That the consumer or a third party is solely at
fault (R.A. No. 7394, Art. 99).
Requisites for Enforcing Liability against the
Defendant
The plaintiff should allege and prove that:
1. The product was defective;
2. The product was manufactured by the defendant;
and
3. The defective product was the cause in fact of his
injury (AQUINO, TORTS and DAMAGES, supra
at 794).
BUSINESS TORTS
Kinds:
1. Non-Possessory Invasion
Elements:
a. The other has property rights and privileges
with respect to the use or enjoyment
interfered with;
b. The invasion is substantial;
c. The defendant’s conduct is a legal cause of
invasion; and
d. The invasion is either intentional and
unreasonable or unintentional and actionable
under general negligence rules (Id. at 797).
2. Interference of Contracts
Statutory Basis: Any third person who induces
another to violate his contract shall be liable for
damages to the other contracting party (CIVIL
CODE, Art. 1314).
GENERAL RULE: Only the parties to a contract
are bound by the terms of the contract and only a
party can file an action for breach of contract or
for rescission or annulment thereof (CIVIL
CODE, Art. 1312).
EXCEPTIONS:
a. Stipulation in favor of third person;
b. Contracts intended to defraud creditors
(CIVIL CODE, Art. 1313).
It is tortuous because it violates the rights of the
contracting parties to fulfill the contract and to
have it fulfilled, to reap the profits resulting
therefrom, and to compel the performance by the
other party (AQUINO, Torts and Damages, supra
at 797-798).
Elements: (EKI)
a. Existence of a valid contract;
NOTE: No action can be maintained if
contract is void (Id. at 801).
b. Knowledge on the part of the third person of
the existence of the contract; and
NOTE: Malice in the sense of ill-will or spite
is not essential.
c. Interference of the third person without legal
justification (Go v. Cordero, G.R. No.
164703, May 4, 2010).
NOTE: Breach must occur because of the
alleged act of interference (Bun v. CA, G.R.
No. 120554, September 21, 1999).
Elements of Privilege to Interfere:
a. The defendant’s purpose is a justifiable one;
and
b. The actors do not employ means of fraud or
deception, which are regarded as unfair
(AQUINO, Torts and Damages, supra at
805).
Extent of Liability:
a. The extent of the liability for the breach of a
contract must be determined in the light of
the situation in existence at the time the
contract is made; and the damages ordinarily
recoverable are in all events limited to such
as might be reasonable are in all events
limited to such as might be reasonably
foreseen in the light of the facts then known
to the contracting parties (Daywalt v. La
Corporacion, G.R. No. L-13505, February 4,
1919);
b. Defendant cannot be held liable for more
than the amount for which the contracting
party who was induced to break the contract
can be held liable; and
c. Rule under Articles 2201 and 2202 of the
Civil Code
If in bad faith: Defendant is liable for all
natural and probable consequences of his
act or omission, whether the same is
foreseen or unforeseen (Go v. Corderdo,
G.R. No. 164703, May 4, 2010).
If in good faith: Defendant is liable only for
consequences that can be foreseen.
3. Interference with Prospective Advantage
It is a tort committed when there is no contract yet
and the defendant is only being sued for inducing
another not to enter into a contract with the
plaintiff (AQUINO, Torts and Damages, supra at
808).
Illustrations:
a. Philip, with ill will, induced an employer not to
hire James, the latter may hold Philip liable
for interfering with a prospective advantage
(Id.).
b. Ernest, a wealthy banker and a man of
considerable influence in the community. He
maliciously established a barber shop and
employed his influence to attract the
customers of the plaintiff’s barber shop.
Ernest’s sole purpose in establishing his
shop was to ruin the plaintiff (Id.).
4. Unfair Competition
Unfair competition has been defined as the
passing off (or palming off) or attempting to pass
off upon the public the goods or business of one
person as the goods or business of another with
the end and probable effect of deceiving the
public (Co v. Spouses Yeung, G.R. No. 212705,
September 10, 2014).
True Test: Whether the acts of defendant are
such as are calculated to deceive the ordinary
buyer making his purchases under the ordinary
conditions which prevail in the particular trade to
which the controversy relates (Alhambra Cigar &
Cigarette Manufacturing Co v. Mojica, G.R No.
8937, March 21, 1914).
Unfair competition in agricultural, commercial, or
industrial enterprises, or in labor, through the use
of force, intimidation, deceit, machination or any
unjust or oppressive or highhanded method shall
give rise to a right of action by a person who
thereby suffers damage (CIVIL CODE, Art. 28).
 Cases included: (PIMM)
a. Passing off and disparagement of products;
b. Interference;
Unfair competition includes cases involving
the tort of interference with contractual
relations and interference with prospective
advantage.
c. Misappropriation;
Unfair competition is likewise present if the
defendant committed fraudulent
misappropriation against a competition.
d. Monopolies and predatory pricing (R.A. No.
8293, Sec. 168).
Monopoly – any combination the tendency of
which is to prevent competition in the broad and
general sense, or to control prices to the
detriment of the public (Gokongwei, Jr. v. SEC,
G.R. No. L-45911, April 11, 1979).
In short, it is the concentration of business in the
hands of a few. The material consideration in
determining its existence is not that prices are
raised and competition actually excluded, but that
power exists to raise prices or exclude
competition when desired." (Agan, Jr. v.
Philippine International Air Terminals Co., Inc.,
G.R. Nos. 155001, 155547 & 155661, May 5,
2003).
Predatory pricing - means selling or offering to
sell any product at a price unreasonably below
the industry average cost so as to attract
customers to the detriment of competitors (R.A.
No. 8180, An Act Deregulating the Downstream
Oil Industry, and for Other Purposes).
Cartel – any combination of or agreement
between two (2) or more persons engaged in the
production, manufacture, processing, storage,
supply, distribution, marketing, sale or disposition
of any basic necessity or prime commodity
designed to artificially and unreasonably increase
or manipulate its price (R.A. No. 7581, The Price
Act, Sec. 5).
5. Securities-Related Torts (R.A. No. 8799,
Securities Regulation Code);
Kinds:
a. Fraudulent transactions (Securities
Regulation Code / R.A. No. 8799, Sec. 26);
b. Misstatements or omission of statement of a
material fact required to be stated (R.A. No.
8799, Sec. 56 - 57).
Defendants are not liable if they can prove that
at the time of the acquisition, the plaintiff knew of
the untrue statement or if he was aware of the
falsity.
DAMAGES
(ARTS. 2195-2235)
The provisions on Damages found in Articles 2195 to
2235 of the Civil Code are applicable to all kinds of
obligations (Art. 1157) whatever may be their sources
(CIVIL CODE, Art. 2195).
DAMAGE
This refers to the detriment, injury or loss which are
occasioned by reason of fault of another in the
property or person (AQUINO, Torts and Damages,
supra at 819).
The pecuniary compensation, recompense, or
satisfaction for an injury sustained, or as otherwise
expressed, the pecuniary consequences which the
law imposes for the breach of some duty or the
violation of some rights (People v. Ballesteros, G.R.
No. 120921, January 29, 1998; People v. Oandasan,
Jr., G.R. No. 194605, June 14, 2016).
DAMAGE VS. INJURY
Damage is the indemnity recoverable by a person
who has sustained an injury either in person, or
relative rights through the act or default of another. It
is the injury or loss for which compensation is sought
(Bouviere’s Law Dictionary, 749-750 cited by
ALBANO, Torts and D amages, supra at 400).
Injury is the wrongful act or tort which causes harm to
another. The word “injury” denotes the illegal act; the
term “damages” means the sum recoverable which
amends for the wrong (Id. at 401).
DAMAGE V. INJURY V. DAMAGES
Damage is the loss, hurt, or harm which results from
the injury; Injury is the legal invasion of a legal right;
and Damages are the recompense or compensation
awarded for the damage suffered (Far East Bank and
Trust Company v. Pacilan, Jr., G.R. No. 157314, July
29, 2005).
NOTE: A complaint for damages is a personal action
(AQUINO, Torts and Damages, supra at 820).
DAMAGES V. RESTITUTION V.
INJUNCTION
DAMAGES RESTITUTION INJUNCTION
Money Requires the Forbids
awarded to defendant to threatened
the person restore any gains actions, requires
 considering the situation of the defendant and the
injured by the he made in a the defendant to
evidence on hand (SUAREZ, Torts and Damages
tort of transaction, or by alter harmful
(2011), p.151 [hereinafter SUAREZ, Torts and
another (DE his act or conduct or
Damages]).
LEON, Torts omission (Id. at repair its
and 634). consequences
Damages, (Id.). KINDS OF DAMAGES: (MENTAL)
supra at 1. Moral;
633). 2. Exemplary or corrective;
3. Nominal;
4. Temperate or moderate;
NOTE: Both restitution and injunction are
5. Actual or Compensatory;
occasionally available in tort cases (Id.).
6. Liquidated (CIVIL CODE, Art. 2197).
AWARD MUST BE MONETARY ACTUAL OR COMPENSATORY
In actions for damages, courts should award an
DAMAGES
amount to the winning party and not its equivalent in
property. The money value of such damages must be Damages awarded to a person as compensation or
awarded (Id. at 820). indemnity for such pecuniary loss suffered by him as
he has duly proved (CIVIL CODE, Art. 2199-2215).
DAMNUM ABSQUE INJURIA (DAMAGE PURPOSE: To repair the wrong that has been done,
WITHOUT INJURY) to compensate for the injury inflicted and not to
Under this principle, the legitimate exercise of a impose penalty (PNOC Shipping and Transport Corp.
person's rights, even if it causes loss to another, does v. CA, G.R. No. 107518, October 8, 1998).
not automatically result in an actionable injury. The
law does not prescribe a remedy for the loss (Amonoy Restitutio in Integrum
v. Gutierrez, G.R. No. 140420, February 15, 2001). The amount to be awarded to the plaintiff should be
that sum of money which will put the party who has
Hence, in the case of Seferino v. FEBTC (G.R. No. been injured or who has suffered in the same position
171845; October 10, 2012), the Supreme Court ruled as he would have been if he had not sustained the
that in the absence of any positive duty of to an wrong for which he is now getting his compensation
adverse claimant, there could be no breach that or reparation (AQUINO, Torts and Damages, supra
entitles the latter to moral damages. at 827).

PECUNIARY LOSS The primary object of an award of a civil action, and

Loss of money or something by which money or the fundamental principle or theory on which it is
something of money value may be acquired (DE based, is just compensation, indemnity or reparation
LEON, TORTS, supra at 624). for the loss or injury (Id. at 827-828).

GENERAL RULE: Every judgment for damages, By way of exception, damages are measured by the
whether arising from breach of contract or the result benefit that has accrued to the defendant in certain
of some provision of law, must rest upon satisfactory cases (e.g., The Intellectual Property Code allows the
proof of the damages alleged to have been suffered recovery of the amount that was earned by the
(Id. at 625). defendant who infringed the right of the owner of the
mark) (Id. at 828).
NOTE: Credence can be given only to claims duly
supported by receipts (Comsavings Bank v. Sps. Plaintiff is entitled to an adequate
Capistrano, G.R. No. 170942, August 28, 2013). Art.
compensation only for pecuniary loss he
2199
suffered and which he has duly proved.
EXCEPTION: In case of moral, nominal, temperate,
liquidated or exemplary damages (CIVIL CODE, Art. Classifications of actual damages:
2216). Being incapable of exact pecuniary 1. Daño emergente or damnum
estimation, the assessment of such damages, except emergens – loss of what a person
for liquidated damages which the parties themselves Art. already possesses.
fix, is left to the sound discretion of the court (People 2200
v. Dianos, G.R. No. 119311, October 7, 1998). 2. Lucro cessante or ganacias
frustradas – failure to receive as a
Damages as and by way of compensation is based, benefit that which would have pertained
however, not only on what the plaintiff claims to be to him (CIVIL CODE, Art. 2205)
just, but also on what may be deemed conscionable
 a. Loss or impairment of earning
capacity in cases of temporary or
permanent personal injury; or
b. Injury to the plaintiff’s business
standing or commercial credit
NOTE: Restitutio in Integrum – Amount
should be that which would put plaintiff in
the same position as he would have been if
he had not sustained the wrong for which he
is now getting his compensation or
reparation (AQUINO, Torts and Damages,
supra at 828).
Speaks of damages in contracts and
quasi-contracts:
1. Obligor in Good Faith
Liable for natural and probable
consequences of the breach of the
obligation and which the parties have
Art. foreseen or could have reasonably been
2201 foreseen at the time the obligation was
constituted.
2. Obligor in Bad Faith
Liable for all damages which may be
reasonably attributed to the non-
performance of the obligation.
Speaks of Damages in Crimes and
Quasi-delicts
He is liable for all damages which are the
natural and probable consequences of the
Art. acts or omission complained of. It is NOT
2202 necessary that such damages have been
foreseen or could have reasonably been
foreseen at the time the obligation was
constituted. There should be restitutio in
integrum.
Doctrine of Avoidable Consequences
Injured victims have a responsibility to act
reasonably to limit or mitigate losses
incurred. Failure to mitigate the injury will
not hold the defendant for incremental
losses that otherwise could have been
avoided.
Where as a consequence of the refusal of
Art.
the injured to submit to an operation, a
2203
series of infections ensued and required
constant and expensive medical treatment
for several years, the defendant should not
be charged with the expenses (Lasam v.
Smith, G.R. No. 19495, February 2, 1924).
A person who reasonably attempts to
minimize his damages can recover the
expenses that he incurred.
Increase or Reduction of Damages in
Crime
The liability for damages may be
Art. respectively increased or lessened
2204 depending on the presence of mitigating or
aggravating circumstances.
Mitigation of Liability (CIVIL CODE, Arts.
2203, 2204, 2214, 2215).
DOCTRINE OF AVOIDABLE
CONSEQUENCES V. CONTRIBUTORY
NEGLIGENCE
DOCTRINE OF
CONTRIBUTORY
AVOIDABLE
NEGLIGENCE
CONSEQUENCES
As to When Act or Omission Occurs
Acts of the plaintiff occur Plaintiff’s act or omission
after the act or omission occurs before or at the
of the defendant time of the act or
(AQUINO, Torts and omission of the
Damages, supra at 869). defendant (Id.).
As Pertaining to the Victim
Injured victim has a Contributed to causing
responsibility to act the accident responsible
reasonably to limit or for the injury.
mitigate losses incurred
(Id.).
GENERAL RULE: Actual damages must be proved
with a reasonable degree of certainty. A court cannot
rely on speculation, conjecture, or guesswork as to
the fact and amount of damages but must depend on
competent proof that they have suffered, and on
evidence of the actual amount thereof (Loadstar
Shipping Co., Inc. v. Malayan Insurance Co., Inc.,
G.R. No. 185565, November 26, 2014).
EXCEPTIONS: (PLL-FDI)
1. When a Penalty clause is agreed upon in the
contract between the parties (CIVIL CODE, Art.
1226);
2. When the Liquidated damages have been
agreed upon (CIVIL CODE, Art. 2226);
3. When the Loss is presumed as when a child or
spouse dies as a result of the act or omission of
a person (Manzanares v. Moreta, G.R. No. L-
12306, October 22, 1918);
4. Forfeiture of bonds in favor of the government for
the purpose of promoting public policy or interest
(Far Eastern Surety and Insurance Co. v. CA,
G.R. No. L-12019, October 16, 1958);
5. “Damages for Death caused by a crime or delict”
which can be awarded forthwith to the heirs of the
victim by proof alone of such fact of death; and
6. Damages Implied by law (e.g., the complainant in
libel cases is not required to introduce evidence
of actual damages at least, when the amount of
the award is more or less nominal. The injury to
the reputation is a natural and probable
consequence of the libel (Quemel v. CA, G.R.
No. L-22794, January 16, 1968).
Where, however, it is reasonably certain that injury
consisting of failure to realize otherwise reasonably
expected profits had been incurred, uncertainty as to
the precise amount of such unrealized profits will
NOT prevent recovery or the award of damages
(Talisay-Silay Milling Co. v. Asociacion de
Agricultores de Talisay-Silay, Inc., G.R. No. 91852,
August 15, 1995).
May Actual Damages be Recovered on the Basis
of Mere Testimony?
No. The Supreme Court ruled in Fuentes v. CA (G.R
No. 111692, February 9, 1996) that as there is no
tangible document upon which the actual damages is
based, actual damages cannot be recovered on the
basis of mere testimony. To seek recovery for actual
damages, it is essential that the injured party proves
the actual amount of loss with reasonable degree
premised upon competent proof and on the best
evidence available (JURADO, Civil Law Reviewer,
supra at 1279).
Doctrine of Foreseeable or Anticipated
Consequences
Only those injuries which could have been
reasonably foreseen by the parties at the time the
contract was entered into are recoverable contract
damages (SANGCO, Torts and Damages, supra at
952).
If there was a stipulated date of delivery of goods,
damages may come in the form of the difference
between the value of the goods at the time they
should have been delivered and at the time of actual
delivery (Uy Chaco v. Admiral Line, G.R. No. 22134,
October 17, 1924); (ALBANO, Torts and Damages,
supra at 419).
In a building contract, if there is a time frame within
which to complete the repairs of construction, in case
of delay, the contractor may be liable for damages (Id.
at 420).
Damage to Property
1. Damage to Personal Property
Where goods were destroyed by the wrongful
act of the defendant, the plaintiff is entitled to
their value at the time of destruction. Normally,
the award is the sum of money which plaintiff
would have to pay in the market for identical or
essentially, similar good, plus in proper cases,
damages for the loss of use during the period
before replacement (AQUINO, Torts and
Damages, supra at 834).
2. Damage to Real Property
The measure of damage for a permanent injury
is ordinarily the difference between the
reasonable market value of the property
immediately before and after the injury. In case
of total loss, the value of the real property at the
time and place of the loss must also be
assessed and such assessed value is the
measure of the damage due to the plaintiff (Id.
at 835).
MORAL DAMAGES (CIVIL CODE, ARTS.
2217-2220)
Moral damages include: (BMW-F-PMS3)
1. Besmirched reputation;
2. Moral shock;
3. Wounded feelings;
4. Fright;
5. Physical suffering;
6. Mental anguish;
7. Serious anxiety;
8. Social humiliation
9. Similar injury (CIVIL CODE, Art. 2217).
Article 2217 of the Civil Code states what are
included in moral damages while Article 2219
enumerates the cases where they may be recovered.
NOTE: The cases when moral damages may be
awarded are specific. Unless the case falls under the
enumeration as provided in Article 2219, which is
exclusive, and Article 2220 of the Civil Code, moral
damages may not be awarded (Coca-Cola Bottlers
Phils., Inc. vs. Meñez, G.R. No. 209906, November
22, 2017).
The award of moral damages is designed to
compensate the claimants for actual injury and is not
meant to enrich the complainant at the expense of the
defendant. The grant of moral damages is based on
the ancient maxim “when there is a wrong there is a
remedy” (AQUINO, Torts and Damages, supra at
875).
They are awarded only to enable the injured party to
obtain means, diversions or amusement that will
serve to alleviate the moral suffering he has
undergone by reason of the defendant’s culpable
action (Kierulf v. CA, G.R. No. 99301, March 13,
1997).
In the case of Kierulf v. CA, petitioner spouses argue
that respondent court should have considered the
loss of their conjugal fellowship and the impairment
of destruction of their sexual life in computing the
moral damages to be awarded to them as a
consequence of the disfigurement of the wife.
Petitioners cited a California case “Rodriguez v.
Bethelem Steel Corp.” which ruled that when a
person is injured to the extent that he/she is no longer
capable of giving love, affection, comfort and sexual
relations to his or her spouse, that spouse has
suffered a direct and real personal loss. The Supreme
Court ruled that whether the Rodrigeuz case may be
cited as authority to support the award of damages
for loss of consortium cannot be properly considered;
that petitioners claim is not supported by the evidence
on record; that he had not testified that, in
consequence of the disfigurement, his right to marital
consortium was affected (Id.).
NOTE: In the above case, the Supreme Court did not
make a definite ruling that loss of marital consortium
cannot be included in the computation of moral
damages.
Among the factors that can be considered in
assessing moral damages is the standing of the
offended party in the community, on the one hand,
and the financial capability of the offender, upon the
other hand, without either being preclusive of other
circumstances even perhaps more primordial, like the
gravity of injury and the wrong causing it, that may be
attendant to each case (Former Mayor Brigido Simon
Jr. v. Martinez, G.R. No. 156025, January 31, 2007).
Nature and Purpose
Moral damages are not punitive and not intended to
enrich the complainant in order to punish the
defendant. They are for reparation of the spiritual
status quo ante; a means to assuage the moral
suffering of the complainant brought about by
defendant’s culpable action (Manila Electric Co. v.
Spouses Ramos, G.R. No. 195145, February 10,
2016).
Proof and Causation
No proof of pecuniary loss is necessary in order that
moral damages may be adjudicated. The
assessment of such damages is left to the discretion
of the court, according to the circumstances of each
case. However, there must be proof that defendant
caused physical suffering, mental anguish, fright,
serious anxiety, besmirched reputation, wounded
feelings, moral shock, social humiliation, similar injury
to the plaintiff (AQUINO, Torts and Damages, at 877-
878).
Amount of Moral Damages to be Awarded
It must be commensurate to the suffering or
proportionate to the wrong committed (Manila Electric
Company v. Jose, G.R. No. 152769, February 14,
2007).
Factors in Determining Amount: (EPS)
1. Extent of Humiliation;
2. Pain and suffering;
3. Official, political, social and financial Standing;
and,
4. Age. (AQUINO, Torts and Damages, supra at
886-890).
Proximate Result
Such damages must be the proximate result of a
wrongful act or omission the factual basis of which is
satisfactorily established by the aggrieved party (Lim
v. Gomez, G.R. No. 160110, June 18, 2014).
GENERAL RULE: The plaintiff must allege and
prove:
1. The factual basis for moral damages; and
2. Its causal relation to the defendant’s act
(AQUINO, Torts and Damages, supra at 878).
EXCEPTION: Moral damages may be awarded to the
victim in criminal proceedings without the need for
pleading of proof of the basis thereof (Id.).
Requisites for Award of Moral Damages:
1. Injury whether physical, mental or psychological,
clearly sustained by the claimant;
2. Culpable act or omission;
3. Such act or omission is the proximate cause of
the injury; and
4. Damages predicated on the cases cited in Art.
2219 of the Civil Code and analogous cases, to
wit:
a. A criminal offense resulting in physical
injuries;
b. Quasi-delicts causing physical injuries;
c. Seduction, abduction, rape, or other
lascivious acts;
d. Adultery or concubinage;
e. Illegal or arbitrary detention or arrest;
f. Illegal search;
g. Libel, slander or any other form of
defamation;
h. Malicious prosecution; or
i. Acts mentioned in Art. 309; Acts and actions
referred to in Art. 21, 26, 27, 28, 29, 30, 32,
34, and 35 (DE LEON, Torts and Damages,
supra at 804).
Moral Damages in Culpa Contractual
In culpa contractual, moral damages are recoverable
only if the defendant acted fraudulently or in bad faith,
or is found guilty of gross negligence amounting to
bad faith, or in wanton disregard of his contractual
obligations. The breach must be wanton, reckless,
malicious or in bad faith, oppressive or abusive
(Emmanuel B. Aznar v. Citibank, N.A., (Philippines),
G.R. No. 164273, March 28, 2007).
A conscious or intentional design need not always be
present since negligence may occasionally be so
gross as to amount to malice or bad faith. Bad faith in
the context of Article 2220 of the Civil Code includes
gross negligence (Bankard, Inc. v. Feliciano, G.R.
No. 141761, July 28, 2006).
In an action for breach of contract of carriage, moral
damages may be awarded only in case:
1. an accident results in the death of a passenger; or
2. the carrier is guilty of fraud or bad faith (Darines v.
Quinones, G.R. No. 206468, August 02, 2017).
Moral damages in case of physical injuries are
recoverable only by the party injured (Manila Doctors
Hospital v. So Un Chua, G.R. No. 150355, July 31,
2006).
Moral Damages in Quasi-delict
Moral damages may be aptly recovered:
1. When an act or omission causes physical
injuries
2. Where the defendant is guilty of intentional
tort, (DE LEON, Torts and Damages, supra at
805).
NOTE: This rule also applies, as aforestated, to
contracts when breached by tort (Id.).
Moral Damages in Crimes or Felonies
It could be lawfully due when the accused is found
guilty of physical injuries, lascivious acts, adultery or
concubinage, illegal or arbitrary detention, illegal
arrest or search, defamation and malicious
prosecution (Id.).
The award of civil indemnity is mandatory without
need of proof other than the commission of the crime
(People v. Credo, G.R. No. 197360, July 3, 2013).
Though R.A. 9346 prohibits the imposition of death
penalty, the civil indemnity is proper, because it is not
dependent on the actual imposition of the death
penalty but on the fact that qualifying circumstances
warranting the imposition of the death penalty
attended the commission of the offense (People v.
Credo, G.R. No. 197360, July 3, 2013).
May a Person Who Slapped Another on the Face
be Held Liable for Damages?
Yes. The act of slapping another in the face is
contrary to morals and good customs and under the
circumstances, could not but have caused the latter
mental anguish, moral shock, wounded feelings and
social humiliation.
A slap on the face is an unlawful aggression. The face
personifies one’s dignity and slapping it is a serious
personal affront. It is a physical assault coupled with
a willful disregard to the integrity of one’s person
(ALBANO, Torts and Damages, supra at 493).
Persons who may Recover Moral Damages
GENERAL RULE: Only the victim can recover.
EXCEPTION: The following relatives of the victim
may recover:
1. The spouse, legitimate and illegitimate
descendants and ascendants of the deceased
(CIVIL CODE, Art. 2209).
2. The parents of a female seduced, abducted,
raped, or abused (CIVIL CODE, Art. 2219 par 3).
3. The spouse, descendants, ascendants, and
brothers and sisters, in the order named, against
any person who shows disrespect to the dead, or
wrongfully interferes in the funeral of the
deceased.
NOTE: They must also suffer mental anguish, serious
anxiety, wounded feelings, moral shock and other
similar injuries (AQUINO, Torts and Damages, supra
at 893-894).
Note, however, that the right to claim damages by the
siblings (brothers and sisters) is limited only to the
third enumeration. Hence, in the case of Sulpicio
Lines v. Curso, et al., the Supreme Court ruled that
the surviving siblings of a passenger during a voyage
may not claim moral damages in behalf of the
deceased (G.R No. 157000, March 17, 2010).
Award of Moral Damages to Corporations
GENERAL RULE: A corporation may not be awarded
moral damages, it being a juridical person; it cannot
suffer from wounded feelings, serious anxiety, mental
anguish or moral shock (Manila Electric Co. v.
T.E.A.M. Corporation, G.R. No. 131723, December
13, 2007).
EXCEPTION: Libel, slander or any other form of
defamation. But there must be evidence to prove it to
justify the award (CIVIL CODE, Art. 2279 par. 7,
Filipinas Broadcasting Network, Inc. v. Ago Medical
and Educational Center – Bicol Christian College of
Medicine, GR. No. 141994, January 17, 2005).
NOTE: In Manila Electric Co. v. T.E.A.M. Corporation
(supra), the Court deemed it proper to delete the
award of moral damages. TEC's claim was premised
allegedly on the damage to its goodwill and
reputation. It is essential to prove the existence of the
factual basis of the damage and its causal relation to
petitioner's acts. In the present case, the records are
bereft of any evidence that the name or reputation of
TEC/TPC has been debased as a result of
petitioner's acts. Besides, the trial court simply
awarded moral damages in the dispositive portion of
its decision without stating the basis thereof.
NOMINAL DAMAGES (CIVIL CODE, ART.
2221-2223)
They are those recoverable where a legal right is
technically violated and must be vindicated against
an invasion that has produced no actual present loss
of any kind, or where, from the nature of the case,
there has been some injury arising from a breach of
contract or legal duty the amount thereof has not
been or cannot be shown. (DE LEON, Torts and
Damages, supra at 837).
Purpose: In order that a right of the plaintiff, which
has been violated or invaded by the defendant, may
be vindicated or recognized. It is not for the purpose
of indemnifying the plaintiff for any loss suffered by
him (CIVIL CODE, Art. 2221).
However, an award of nominal damages precludes
the recovery of actual, moral, and temperate
damages (DE LEON, Torts and Damages, supra at
845).
The law presumes damage although actual or
compensatory damages are not proven (Gonzales v.
People, G.R. No. 159950, February 12, 2007).
Nominal damages are recoverable where a legal right
is technically violated and must be vindicated against
an invasion that has produced no actual present loss
of any kind or where there has been a breach of
contract and no substantial injury or actual damages
whatsoever have been or can be shown (Cathay
Pacific Airways v. Reyes, G.R No. 185891, June 26,
2013).
TEMPERATE OR MODERATE DAMAGES
(SEE CIVIL CODE, ART. 2224 AND 2225)
Under Article 2224 of the Civil Code, temperate
damages may be recovered when the court finds that
some pecuniary loss has been suffered but its
amount cannot, from the nature of the case, be
proved with certainty.
These are damages, which are more than nominal
but less than compensatory, and may be allowed in
cases where from the nature of the case, definite
proof of pecuniary loss cannot be adduced, although
the court is convinced that the aggrieved party
suffered some pecuniary loss (Adriano v. Lasala,
G.R. No. 197842, October 9, 2013).
Temperate and actual damages are mutually
exclusive in that both may not be awarded at the
same time (People v. Gutierrez, G.R. No. 188602,
February 4, 2010).
However:
1. In cases where the resulting injury might be
continuing and possible future complications
directly arising from the injury, while certain to
occur are difficult to predict, temperate damages
can and should be awarded on top of actual or
compensatory damages. In such cases, there is
no incompatibility between actual and temperate
damages when both are provided; or,
2. In cases of additional damages to cover
estimated future cost of proper care where it
would not be equitable for the victim to constantly
come to court and invoke their aid in seeking
adjustments to the compensatory damages
previously awarded, temperate damages are
appropriate (Ramos v. CA, G.R. No. 124354,
April 11, 2002).
Heirs of the victim of murder are entitled to
Php50,000 as civil indemnity, which is mandatory and
granted without need of any evidence or proof of
damages other than the commission of the crime
(People v. Cabinan, G.R. No. 176158, March 27,
2007).
Temperate Damages in Lieu of Actual Damages
Since the heirs undeniably incurred expenses for the
wake and burial, the Supreme Court awarded
temperate damages in the amount of P25,000
pursuant to prevailing jurisprudence, in lieu of actual
damages as it would be unfair to the victim’s heirs to
get nothing, despite the death of their kin, for reason
alone that they cannot produce receipts (Philippine
National Railways v. Ethel Brunty, G.R. No. 169891,
November 2, 2006).
The court did not award actual damages due to lack
of proof of actual expenses, but instead granted
temperate damages in the amount of P50,000.
Temperate damages may be recovered when
pecuniary loss has been suffered but its amount
cannot be proved with certainty (People v. Berondo,
G.R. No. 177827, March 30, 2009).
When the crime is heinous, the Supreme Court
increased the award for mandatory civil indemnity to
P75,000.00 to conform to recent jurisprudence
(People v. Vergara, G.R. No. 177763, July 3, 2013).
LIQUIDATED DAMAGES (SEE CIVIL
CODE, ART. 2226-2228)
Those agreed upon by the parties in a contract, to be
paid in case of breach thereof.
PURPOSE: To strengthen the coercive force of the
obligation by the threat of greater responsibility or
consequences in the event of breach (DE LEON,
Torts and Damages, supra at 853).
Liquidated damages, whether intended as an also be iniquitous by a supervening change of
indemnity or a penalty, shall be equitably reduced if circumstances, which makes the amount grossly
they are iniquitous or unconscionable (CIVIL CODE, disproportionate to the damage suffered by the
Art. 2227). creditor. In such cases, the court may reduce the
amount of penalty (ALBANO, Torts and Damages,
Liquidated damages are those agreed upon by the supra at 512).
parties. No proof is necessary. It is not subject to any
contingency or determination as it is already agreed EXEMPLARY OR CORRECTIVE
upon. The reason why there is no need for proof to DAMAGES (CIVIL CODE, ART. 2229-2235)
recover liquidated damages is because the
agreement is the law between the parties (ALBANO, Imposed by way of example or correction for the
Torts and Damages, supra at 512). public good, in addition to the moral, temperate,
liquidated or compensatory damages. It is required by
public policy to suppress wanton acts (AQUINO,
LIQUIDATED DAMAGES V. PENALTY Torts and Damages, supra at 916).
LIQUIDATED PENALTY
DAMAGES Requisites: (ANB)
1. Imposed, by way of example in Addition to
As to Purpose compensatory damages, only after the claimant’s
right to it has been established;
Sum inserted in a Sum inserted in a 2. Not recoverable as a matter of right, their
contract as a measure contract as a punishment determination depending upon the amount of
of compensation for its for default, or by way of compensatory damages that may be awarded;
breach (DE LEON, security for actual and
Torts and Damages, damages which may be 3. The act must be accompanied by Bad faith or
supra at 853). sustained because of done in wanton, fraudulent, oppressive or
non-performance (Id.). malevolent manner (Id. at 917).
As to Nature Exemplary Damages in Delict or Crime
Its essence is a An agreement to pay a Relative to the civil aspect of the case, an aggravating
genuine covenanted stipulated sum on breach circumstance, whether ordinary or qualifying, should
pre-estimate of of contract irrespective of entitle the offended party to an award of exemplary
damages (Id.). the damage sustained damages within the unbridled meaning of Article 2230
(Id.). of the Civil Code (People v. Vergara, G.R. No.
177763, July 3, 2013).
As to Legal Results
Exemplary Damages in Quasi-Delict
There are no difference as far as legal results are It may be awarded if the defendant acted with gross
concerned (Id). negligence (CIVIL CODE, Art. 2232).

As to Necessity of Proof of Damages Exemplary Damages in Contracts and Quasi-

Contracts
In either case, the injured party need not prove his It may be awarded if the defendant acted in a wanton,
damages in order that the sum stipulated may be fraudulent, reckless, oppressive, malevolent manner
demanded (Id.). (CIVIL CODE, Art. 2232).

As to Effect if Principal Obligation is Void ART. 2233 V. ART. 2234 V. ART 2235
Should the principal obligation be void, the ART. 2233 ART. 2234 ART. 2235
stipulation on liquidated damages will also be void;
both damages being accessory obligations to the Exemplary Although the Agreement
principal obligation (CIVIL CODE, Art. 1230). damages amount of to renounce
cannot be exemplary exemplary
recovered as a damages need damages in
The amount of penalty is not determined by the injury matter of right. not be proved, advance
suffered by the creditor, but by what has been agreed This may be plaintiff must show shall be null
upon by the parties who are free to determine such granted at the that he is entitled and void.
amount. The limits of good customs, however, should discretion of to moral,
not be infringed. A penalty would be contrary to good the court even temperate or
customs if it would occasion the economic ruin and if not expressly compensatory
represent an undue exploitation of the debtor. It may pleaded or damages.
 prayed for.
OTHER KINDS OF DAMAGES
ART. 2196 ART. 2216
Compensation for This covers damages
Workmen and other awarded when there is
employees. This covers no proof of pecuniary
damages for workmen loss. This is left to the
and other employees in discretion of the court,
case of death, injury or according to the
illness under special law circumstances of each
(e.g., indemnity for case (e.g., damages
worker). arising from tort or
crime).
When May Exemplary Damages be Imposed?
1. In criminal offenses, it may be imposed when the
crime was committed with one or more
aggravating circumstances;
2. In quasi delicts, it may be imposed if the
defendant acted with gross negligence;
3. In contracts and quasi-contracts, it may be
imposed if defendant acted in wanton, fraudulent,
reckless, oppressive, or malevolent manner
(JURADO, Civil Law Reviewer, supra at 1315).
DAMAGES IN CASE OF DEATH
The amount of damages caused by a crime or quasi-
delict shall be at least Php 3,000.00, even though
there may have been mitigating circumstances
(CIVIL CODE, Art. 2206; See Summary of Damages
pursuant to People v. Jugueta, G.R. No. 202124,
April 5, 2016 below).
When the death occurs due to a crime, the following
may be awarded; (1) civil indemnity ex delicto for the
death of the victim; (2) actual or compensatory
damages; (3) moral damages; (4) exemplary
damages; (5) temperate damages (People v. Asis, et
al., G.R. No. 177573, July 7, 2010).
In addition, the defendant shall be liable for:
1. Loss of the earning capacity of the deceased,
to be paid to the heirs of the deceased;
Exception: if the deceased had no earning
capacity at the time of his death.
2. The recipient of support who is not an heir called
to the decedent’s inheritance by the law of testate
or intestate succession, may demand support
from the person causing the death, for a period
not exceeding 5 years, the exact duration to be
fixed by the court; and
3. The spouse, legitimate and illegitimate
descendants and ascendants of the deceased
may demand moral damages (CIVIL CODE, Art.
2206).
LOSS OF EARNING CAPACITY (CIVIL
CODE, Art. 2205, par. 1)
Formula:
{2/3 x (80–age of death)} x monthly earnings x 12
2
(AQUINO, Torts and Damages, supra at 842).
Variables considered are:
1. Life expectancy, computed as:
{2/3 x (80 – age at death)} (Id.); and
2. Net income/earnings – the total of the earnings
less expenses necessary for the creation of such
earnings and less living or other incidental
expenses (Id. at 843).
The Court considered as an important element in
measuring the loss of earning capacity, the net
earnings of the deceased as well as the latter’s
potentiality and capacity to increase his future income
(Villa Rey Transit v. CA, G.R. No. L-25499, February
18, 1970).
The plaintiff is also entitled to damages for loss of
earning capacity when the defendant’s act or
omission resulted in his permanent incapacity. Thus,
in Borromeo v. Manila Electric Railroad & Light Co.
(G.R. No. 18345, December 5, 1922), the Supreme
Court awarded in favor of the plaintiff an amount for
his loss of earning capacity because he lost his left
foot, and because of such loss, he could no longer be
employed as a marine engineer on any vessel
(AQUINO, Torts and Damages, supra at 839-840).
Illustration:
In People v. Galvez (G.R. No. 136790, March 26,
2001), deceased died at the age of 21 and was
working as a construction worker with a monthly
income of P3,262.50.
2/3 x (80-21) (age of victim at time of death) = 39.33
P3,262.50 x 12 = P39, 150.00 (Gross annual Salary)
P39,150.00 x 0.50 (allocation of living expenses) =
P19,575.00 (Net Income)
Loss of Earning Capacity
= 39.33 x P19,575.00
= 769,884.75
Ascertaining the Amount of Compensation:
1. Determination of the extent to which such
capacity has been diminished;
2. Determination of the permanency of the
decrease in earning capacity; and
3. The fixing of the amount of money which will
compensate for the determined extent and length
of impairment, including a reduction of the award
to its present worth (DE LEON, Torts and
Damages, supra at 699).
It is not necessary for the plaintiff to be employed at
the time of the injury for the court to be able to
compensate him both for the value of the time lost
after the injury and before the trial and the impairment
to his capacity to earn money in the future (Id. at 702-
703).
Indemnification for loss of earning capacity must be
duly proven. It partakes the nature of actual
damages. It refers to the net income, i.e., his total
income net of expenses (People v. Cuenco, G.R. No.
143819, January 29, 2002).
In computing the loss of earning capacity of the
victim, several factors are considered besides the
mathematical computation of annual income times
life expectancy. Allowances are made for
circumstances which could reduce the computed life
expectancy of the victim, e.g., nature of the work, his
life style, age, and state of health prior to his death
(ALBANO, Torts and Damages, supra at 430).
May the Financial Capacity of a Carrier-Defendant
be Considered in the Award of Damages?
Yes. The financial capacity of the carrier may not be
necessary in determining whether or not it is liable,
but such financial capacity becomes relevant and
necessary in determining a reasonable or equitable
amount of compensation or damages that may be
awarded to the victims should the court be convinced
that the carrier is liable (Id. at 433).
GENERAL RULE: Documentary evidence should
substantiate the claim for damages for loss of earning
capacity (AQUINO, Torts and Damages, supra at
846).
NOTE: Nothing in the Rules of Court requires that
only documentary evidence is allowed in civil cases.
All that is required is the satisfaction of the quantum
of evidence, that is, preponderance of evidence. In
addition, the Civil Code does not prohibit a claim for
loss of earning capacity on the basis that it is not
proven by documentary evidence. Testimonial
evidence, if not questioned for credibility, bears the
same weight as documentary evidence (Torreon v.
Aparra, Jr., G.R. No. 188493, December 13, 2017).
EXCEPTIONS:
1. The award of temperate damages for loss of
earning capacity in lieu of documentary evidence;
2. Non-working victims;
3. The deceased is self-employed and earning less
than the minimum wage under current labor laws;
and
4. When testimonial evidence sufficiently
establishes the loss (e.g., testimony of the
corporate officers of employer or the widow of the
victim) (AQUINO, Torts and Damages, supra at
847-848).
Loss of Earning Capacity of Non-working Victims
Earning capacity may be impaired even if no actual
earning is lost in the meantime. In a number of cases,
the Supreme Court recognized the entitlement of the
heirs of the deceased for loss of earning capacity of
the deceased even if the said deceased was not
working at the time of the accident. What is important
is that there is proof of loss of earning capacity and
not necessarily actual loss of income (Id. at 850).
Can the Court Award Indemnification for Loss of
Earning Capacity Without Adequate Proof?
No. Well settled is the rule that the indemnification for
loss of earning capacity must be duly proven. Hence,
the bare testimony of the brother of the deceased is
not sufficient proof. Indemnification for loss of earning
capacity partakes of the nature of actual damages
which must be duly proven. A self-serving statement,
being unreliable is not enough. But for the lost income
to be recovered, there must be likewise an unbiased
proof of the deceased’s average, not just gross,
income (People v. Cuenco, G.R. No. 143819,
January 29, 2002).
LOSS OF PROFITS
Determined by considering the average profit for the
preceding years multiplied by the number of years
during which the business was affected by the
wrongful act or breach (Id. at 857) (Consolidated
Dairy Products et al. v. CA, G.R. No. 100401, August
24, 1992).
Injury to business standing
If a suit is filed by one against another in bad faith,
resulting in besmirched reputation which affected the
latter’s business standing, an award of damages is
proper (ALBANO, Torts and Damages, supra at 424).
ATTORNEY’S FEES:
1. Ordinary
– the attorney’s fee is the reasonable
compensation paid to a lawyer by his client for
the legal services he has rendered to the latter.
BASIS: the fact of his employment by and his
agreement with the client (Traders Royal Bank
Employees Union v. NLRC, G.R. No. 120592,
March 14, 1997).
2. Extraordinary
– the attorney’s fee is an indemnity for damages
ordered by the court to be paid by the losing party
in a litigation to the prevailing party.
Attorney’s fees may be awarded when a party is
compelled to litigate or incur expenses to protect its
interest, or when the court deems it just and equitable
(Durban Apartments Corp. v. Pioneer Insurance and
Surety Corp., GR No. 179419, January 12, 2011).
An award of attorney’s fees is the exception rather
than the rule, as they are not always awarded every
time a party prevails in a suit because of the policy
that no premium shall be placed on the right to litigate
(Financial Building Corp v. Rudlin International Corp,
et al., G.R. No. 164186, October 4, 2010).
Payable not to the lawyer but to the client, unless they
have agreed that the award shall pertain to the lawyer
as additional compensation or as part thereof
(Benedicto v. Villaflores, G.R. No. 185020, October
6, 2010).
The law allows parties to recover attorney’s fees
under a written agreement. In Barons Marketing
Corp. v CA (G.R. No. 126486, February 9, 1998), the
Court ruled that the attorney’s fees provided in the
contract are in the nature of liquidated damages and
the stipulation therefor is aptly called a penal clause.
So long as such stipulation does not contravene law,
morals, or public order, it is strictly binding upon the
defendant.
Plaintiff must allege the basis of his claim for
attorney’s fees in the complaint (AQUINO, Torts and
Damages, supra at 861).
Basis: Any of the cases provided by law where such
award can be made, such as those authorized in Art.
2208 of the Civil Code (Construction Development
Corp. v. Estrella, G.R. No. 147791, September 8,
2006).
Grounds for claiming attorney’s fees: (SL UM- 2 payment of sum of money (e.g., a loan or
D2OW2G)
1. In a Separate civil action to recover civil liability
arising from a crime;
2. When defendant's act or omission compelled the
plaintiff to Litigate with third persons or to incur
expenses to protect his interest;
3. In actions for Legal support;
4. In a clearly Unfounded civil action or proceeding
against the plaintiff;
5. In criminal cases of Malicious prosecution
against the plaintiff;
6. When exemplary Damages are awarded;
7. When at least Double judicial costs are awarded;
8. In any Other case where the court deems it just
and equitable that attorney's fees and expenses
of litigation should be recovered;
9. In actions for the recovery of Wages of household
helpers, laborers and skilled workers;
10. In actions for indemnity under Workmen's
compensation and employer's liability laws; or
11. Where defendant acted in Gross and evident bad
faith in refusing to satisfy the plaintiff's valid, just
and demandable claim (CIVIL CODE, Art. 2208).
NOTE: In all cases, the attorney’s fees and expenses
of litigation must be reasonable (CIVIL CODE Art.
2208). The amount to be awarded is left to the
discretion of the courts (AQUINO, Torts and
Damages, supra at 860).
Although the institution of a clearly unfounded civil
suit can at times be a legal justification for an award
of attorney's fees, such filing, however, has almost
invariably been held not to be a ground for an award
of moral damages (Expertravel & Tours, Inc. v. Court
of Appeals, G.R. No. 130030, June 25, 1999).
Rationale: The law could not have meant to impose
a penalty on the right to litigate. The anguish suffered
by a person for having been made a defendant in a
civil suit would be no different from the usual worry
and anxiety suffered by anyone who is haled to court,
a situation that cannot by itself be a cogent reason for
the award of moral damages; otherwise, moral
damages must every time be awarded in favor of the
prevailing defendant against an unsuccessful plaintiff
(Id.).
When Attorney’s fees may not be recovered:
1. When it is shown that the judgment creditor did
not come to court with clean hands; and
2. When there is no evidence of fraud and bad faith
on the part of the tortfeasor (Tac-an Danao v. CA,
GR no. 62251, July 29, 1985).
INTEREST (CIVIL CODE, ART. 2209, 2210
AND 2212)
1. Breach of obligation consisting of
forbearance of money):
a. The interest due is that stipulated in writing
and the interest due shall itself earn legal
interest from the time it is judicially
demanded.
b. The rate of interest shall be 6% per annum,
in the absence of express contract as to such
rate of interest, including the rate allowed in
judgments (BSP Cir. No, 799, series of 2013)
computed from default, i.e., from judicial or
extra-judicial demand subject to Art. 1169 of
the Civil Code.
2. Breach of obligation not constituting a
loan or forbearance of money:
a. An interest on the amount of damages to be
awarded may be imposed at the discretion of
the court at the rate of six percent (6%) per
annum.
b. No interest shall be adjudged on unliquidated
claims or damages, except when or until
demand can be established with reasonable
certainty.
 c. Where the demand is established with
been suffered but its amount
reasonable certainty, the interest shall begin
cannot, from the nature of the
to run from the time the claim is made
case, be proved with certainty
judicially or extrajudicially (Bernal v. Villaflor,
while actual damages must be
G.R. No. 213617, April 18, 2018).
proved with a reasonable degree
of certainty.
Interest due shall earn interest not from default but
from the time of judicial demand (ALBANO, Torts and
Damages, supra at 452).

DAMAGES THAT CANNOT CO-EXIST

DAMAGES REASON
THAT
CANNOT CO-
EXIST

Nominal damages are

recoverable where a legal right
is technically violated and must
be vindicated against an
invasion that has produced no
Nominal actual present loss of any kind or
damages and where there has been a breach
Actual damages of contract and no substantial
injury or actual damages
whatsoever have been or can be
shown but actual damages must
be proved with a reasonable
degree of certainty.

In nominal damages, it is
recoverable where a legal right
is technically violated and must
be vindicated against an
invasion that has produced no
actual present loss of any kind or
Nominal where there has been a breach
damages and of contract and no substantial
Moral damages injury have been or can be
shown but in moral damages, it
must be shown that plaintiff
suffered mental anguish, serious
anxiety, wounded feelings,
moral shock and other similar
injuries.

In nominal damages, it is
recoverable where a legal right
is technically violated and must
Nominal be vindicated against an
damages and invasion that has produced no
Temperate actual present loss of any kind
damages but in temperate damages, it
may be recovered when the
court finds that some pecuniary
loss has been suffered.

Temperate Temperate damages may be

damages and recovered when the court finds
Actual damages that some pecuniary loss has

LAND TITLES AND
DEEDS
LAND TITLE
Is the evidence of the right of the owner or the extent
of his interest and by which means he can maintain
control and as a rule, assert right to exclusive
possession and enjoyment of the property (PEÑA,
Registration of Land Titles & Deeds Revised Edition
(2008), p 3 [hereinafter PEÑA, Land Titles and
Deeds]).
In its broad sense, the term “jura regalia” refers to
royal rights, or those rights which the King has by
virtue of his prerogatives (Id.).
CONSTITUTIONAL BASIS
All lands of the public domain, waters, minerals,
coal, petroleum, and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife,
flora and fauna, and other natural resources are
owned by the State. With the exception of
agricultural lands, all other natural resources shall
not be alienated. The exploration, development, and
utilization of natural resources shall be under the full
control and supervision of the State (CONST. Art.
XII, Sec. 2, Par. 1).

DEED Both the 1935 and the 1973 Constitutions prohibited

A deed refers to a written document executed in
accordance with law, wherein a person grants or
conveys to another a certain land, tenements, or
hereditaments (PEÑA, supra at 4).
REGALIAN DOCTRINE
CONCEPT
Under the concept of jura regalia, private title to land
must be traced to some grant, express or implied,
from the Spanish Crown or its successors, the
American Colonial Government, and thereafter, the
Philippine Republic. The belief that the Spanish
Crown is the origin of all land titles in the Philippines
has persisted because title to land must emanate
from some source for it cannot issue forth from
nowhere (AGCAOILI, Property Registration Decree
(Land Titles and Deeds) Revised Edition (2018), p.
3 [hereinafter AGCAOILI, Land Titles and Deeds]).
the alienation of all natural resources, except
agricultural lands of the public domain. The 1987
Constitution readopted this policy. Indeed, all lands
of the public domain as well as all natural resources
enumerated in the Philippine Constitution belong to
the State (Collado v. CA, G.R. No. 107764, October
4, 2002).
Simply means that the State is the original proprietor
of all lands and, as such, is the general source of all
private titles (Republic v. Santos, G.R. No. 180027,
July 18, 2012).
EFFECTS
All lands of whatever classification and other natural
resources not otherwise appearing to be clearly
within private ownership are presumed to belong to
the State, which is the source of any asserted right
to ownership of land (Republic v. Sin, G.R. No.
157485, March 26, 2014).
Accordingly, public lands not shown to have been
reclassified or released as alienable land or
alienated to a private person by the State remain
part of the inalienable public domain (Republic v. Tri-

DOHN ALFRED E. AQUILIZAN, Over-All Chairperson | NICHOLE VANE B. SANTOS, Chairperson for Academics | RONALYN A.
GACULA, Ad Hoc Director for Bar Matters | MARIELLE CIELO B. BELGIRA, Vice Chairperson for Finance | JUAN IÑIGO S. MIGUEL,
Vice Chairperson for Operations | ALISSA MARIE D.C. DELOS SANTOS, Vice Chairperson for Audit | CORINA R. TAMPUS, Vice
Chairperson for Secretariat | ARVY KEITH N. CHUNG, Vice Chairperson for Logistics | ANTONIO JUN-JUN C. MANALIGOD IV, Vice
Chairperson for Membership | JORDAN N. CHAVEZ, Vice Chairperson for Electronic Data Processing

NOSLEN ANGINEB E. MENDOZA, Subject Chair | KING LAURENZ S. MASILUNGAN, Assistant Subject Chair | ALHEX ADREA M.
PERALTA, Subject Electronic Data Processing | SUBJECT HEADS: JOAN V. LAGRADILLA, Agency & Trusts | QUENNIE IRIS V.
BULATAO, Conflicts of Law | JESSU R. TRINIDAD, Loan and Deposit | SKY BLUE C. SAMSON, Obligations and Contracts |
CHRISTIENNE NATHALIE A. BEROÑA, Persons and Family Relations | KRISTOFFER MONICO S. NG, Property | JULEEN EVETTE
D. MALLARI, Land Titles and Deeds | MARISOL O. SISON, Sales | GEM EDWARD E. AQUINO, Torts | PATRICIA MAE R. FEDERIS,
Succession |

SAMANTHA YVES O. PLACIDO, QUENNIE IRIS V. BULATAO, JESSU R. TRINIDAD, PATRICIA MARIE G. CARLON,
CHARISMA T. CHAN, ROCKYLLE DOMINIQUE L. BALISONG, ROSELLE JUNE G. CEREÑO, MARIANNE HELENE P. REYEG,
VERONICA V. VELASQUEZ, ALYSSA AIMEE S. BATLE, MICHELLE L. DELOS SANTOS, SUSANNA MARTHA B. IBE, KARLA
MARIE C. SANTOS, YUMIKO ANGELIUS M. YOSHIY, MARY JOY B. DELA CRUZ, JESSA A. YALAO., KIEZLLE CAYNE D.
MANALILI, ANNA ROCHELLE D. PAYONGAYONG, MA. NICOLAI M. TORRES and MIKHAILA KLAUDINE A. ROSALES

Atty. JOSEPH FERDINAND DECHAVEZ

Plus Corporation, G.R. No. 150000, September 26,
2006).
Applying the Regalian Doctrine, the State owns all
waters and lands of the public domain, including
those physically reclaimed. As a general rule,
therefore, only the National Government can reclaim
foreshore lands and other submerged areas
(Republic v. Court of Appeals, G.R. No. 103882,
November 25, 1998).
Property of the public domain is beyond the
commerce of man and not susceptible of private
appropriation acquisitive prescription. Occupation
thereof and in the concept of owner, no matter how
long, cannot ripen into ownership and be registered
as a title (Republic v. Candy Maker, Inc., G.R. No.
163766, June 22, 2006).
That land has been removed from the scope of the
Regalian Doctrine and reclassified as part of the
public domain's alienable and disposable portion
cannot be assumed or implied. The prevailing rule is
that the applicant must clearly establish the
existence of a positive act of the government
(Republic v. Jabson, G.R. No. 200223, June 6,
2018). The burden of proof in overcoming the
presumption of State ownership of the lands of the
public domain is on the person applying for
registration (or claiming ownership), who must prove
that the land subject of the application is alienable or
disposable. To overcome this presumption,
incontrovertible evidence must be established that
the land subject of the application (or claim) is
alienable or disposable (Diaz-Enriquez v. Director of
Lands, G.R. No. 168065, September 6, 2017).
Act No. 2874 (Second Public Land Act),
promulgated in 1919 and reproduced in Section 6 of
CA No. 141 (Public Land Act of 1936), gave the
Executive Department, through the President, the
exclusive prerogative to classify or reclassify public
lands into alienable or disposable, mineral or forest.
Since then, courts no longer had the authority,
whether express or implied, to determine the
classification of lands of the public domain
(Secretary of the DENR v. Yap, G.R. No. 167707,
October 8, 2008).
EXCEPTION TO THE REGALIAN
DOCTRINE
It was ruled that any land under native title, or those
that should have been in the possession of an
occupant and of his predecessors-in-interest since
time immemorial is an exception to the Regalian
Doctrine. Such possession would justify the
presumption that the land had never been part of the
public domain or that it had been private property
even before the Spanish conquest (Cariño v. Insular
Government, 212 U.S. 449 (1909)).
REGALIAN DOCTRINE DOES NOT
NEGATE “NATIVE TITLE”
When, as far back as testimony or memory goes, the
land has been held by individuals under a claim of
private ownership, it will be presumed to have been
held in the same way before the Spanish conquest
(Cariño v. Insular Government, 212 U.S. 449
(1909)).
TITLE
TITLE
The right of the owner or the extent of his interest
and by means of which he can maintain control, and
as a rule, assert his right to the exclusive possession
and enjoyment of the property (NOBLEJAS,
Registration of Land Titles and Deeds, (2007) p. 6
[hereinafter NOBLEJAS, Land Titles and Deeds]).
CERTIFICATE OF TITLE
A mere evidence of ownership. It is not a source of
right but merely confirms or records a title already
existing and vested (Tiro v. Phil. Estates Corp., G.R.
No. 170528, August 26, 2008).
TITLE V. CERTIFICATE OF TITLE
TITLE CERTIFICATE OF
TITLE
Constitutes a just Mere evidence of
cause of exclusive ownership; not the title to
possession of which is the land itself.
the foundation of
ownership of property.
(Castillo v. Escutin, G.R No. 171056, March 13,
2009).
MODES OF ACQUIRING TITLE: (PRADA-
VINE)
1. Public Grant
– By administrative process, the government
transfers land to a private individual by the
issuance of sales patent or special patent (CA
No. 141, also known as The Public Land Act, as
amended).
Commonwealth Act No. 141 (CA 141), also
known as the Public Land Act, remains to this
day the existing general law governing the
classification and disposition of lands of the
public domain, other than timber and mineral
lands. Under the Regalian Doctrine embodied in
our Constitution, land that has not been acquired
 from the government, either by purchase, grant
or any other mode recognized by law, belongs
to the State as part of the public domain. No
public land can be acquired by private persons
through any other means, and it is indispensable
that the person claiming title to public land
should show that his title was acquired through
purchase or grant from the State, or through any
other mode of acquisition recognized by law
(Republic v. Heirs of Juan Fabio, G.R. No. L-
65818, May 13, 1991).
2. Reclamation
– It is the method of filling submerged land by
deliberate acts and reclaiming title thereto
(NOBLEJAS, supra at 42).
Under R.A. 1899, also known as An Act
Authorizing The Reclamation Of Foreshore
Lands By Chartered Cities And Municipalities
June 22, 1957, the National Government
granted to all municipalities and chartered cities
the authority to undertake and carry out at their
own expense the reclamation by dredging,
filling, or other means, of any foreshore lands
bordering them. Any and all such land reclaimed
will become property of the respective
municipalities or chartered cities; but the new
foreshore along the reclaimed areas shall
continue to become property of the National
Government.
NOTE: Under R.A. 1899, foreshore lands should
not be construed to include submerged areas.
(Republic v. CA and Republic Real Estate Corp.,
G.R. No. 103882, November 25, 1988).
3. Acquisitive Prescription
– Must be in the concept of an owner (CIVIL
CODE, Art. 525). A person acquires land title by
acquisitive prescription if he has been in open,
continuous, exclusive, and notorious possession
for a period prescribed by law.
a. Ordinary Prescription – possession in
good faith and with just title for ten (10)
years (CIVIL CODE, Art. 1134)
b. Extraordinary Prescription – adverse
possession without need of title or of good
faith for thirty (30) years (CIVIL CODE, Art.
1137)
Open, continuous, and exclusive possession of
land classified as alienable and disposable for at
least thirty years segregates the land from the
public domain and ipso jure converts the same
into private property (Buenaventura v. Republic,
G.R. No. 166865, March 2, 2007).
Prescription is concerned with lapse of time in
the manner and under conditions laid down by
law, namely, that the possession should be in
the concept of an owner, public, peaceful,
uninterrupted, and adverse. Possession is open
when it is patent, visible, apparent, notorious
and not clandestine. It is continuous when
uninterrupted, unbroken and not intermittent or
occasional; exclusive when the adverse
possessor can show exclusive dominion over
the land and an appropriation of it to his own use
and benefit; and notorious when it is so
conspicuous that it is generally known and
talked of by the public or the people in the
neighborhood (Republic v. Northern Cement
Corp., G.R. No. 200256, April 11, 2018).
Just Title
It means “with color of title and good faith” or con
justo titulo y buenafe (Alba v. CA, G.R. No.
120066, September 9, 1999).
For purposes of prescription, there is just title
when the adverse claimant came into
possession of the property through one of the
recognized modes of acquisition of ownership or
other real rights but the grantor was not the
owner or could not transmit any right (Imuan v.
Cereno, G.R. No. 167995, September 11,
2009).
The rule is well-settled that prescription does not
run against registered land. Thus, under Sec. 47
of P.D. 1529, otherwise known as the Property
Registration Decree, it is specifically provided
that "no title to registered land in derogation of
that of the registered owner shall be acquired by
prescription or adverse possession" (Spouses
Ocampo v. Heirs of Dionisio, G.R. No. 191101,
October 1, 2014). A title, once registered, cannot
be defeated even by adverse, open and
notorious possession. The certificate of title
issued is an absolute and indefeasible evidence
of ownership of the property in favor of the
person whose name appears therein. It is
binding and conclusive upon the whole world. All
persons must take notice and no one can plead
ignorance of the registration (Dr. Rellin v.
Belarmino, G.R. No. 153691, July 19, 2006).
4. Descent or Devise
a. By Descent – acquired by virtue of
hereditary succession to the estate of a
deceased owner; or
b. By Devise – succession need not be in favor
of a relative (NOBLEJAS, supra at 42).
5. Accretion
– To the owners of lands adjoining the banks of
rivers belong the accretion which they gradually
 receive from the effects of the currents of the
waters. (CIVIL CODE, Art. 457).
The alluvial property obtained due to accretion
is not automatically covered by a Torrens title.
Ownership of a piece of land is one thing, and
registration under the Torrens system of that
ownership is quite another. To be covered by the
Torrens title, the alluvial property must be placed
under the operation of the registration laws
(Grande v. CA, G.R. No. L-17652, June 30,
1962).
Accretion formed as a result of dumping of
sawdust is part of public domain. The word
“current” indicates the participation of the body
of water in the ebb and flow of waters due to high
and low tide (Vda. De Nazareno v. CA, G.R. No.
98405, June 26, 1996).
6. Voluntary Transfer
– The transfer is given by the voluntary
execution of a deed of conveyance in certain
prescribed form, completed by the recording or
registration thereof because registration is the
operative act that binds and affects third
persons. Nonetheless, the contract is binding
between parties, their heirs, assignees and
successors in interest (CIVIL CODE, Art. 1311).
Persons Bound Notwithstanding Lack of
Registration:
a. The grantor;
b. The grantor’s heirs and devisees; and
c. Third persons having actual notice or
knowledge thereof (PEÑA, supra at 48).
NOTE: Although the cause is not stated in the
contract, it is presumed that it exists and is
lawful, unless the debtor proves the contrary
(CIVIL CODE, Art. 1354).
7. Involuntary Alienation
– This does not require the consent or
cooperation of the owner of the land and is
usually carried out against his will. Usual forms
of involuntary alienation are expropriation or
condemnation proceedings. Other examples are
escheat, reversion, seizure based on tax
delinquency, levy on attachment, and levy on
execution (NOBLEJAS, supra at 41).
8. Native Title
– Refers to pre-conquest rights to lands and
domains which, as far back as memory reaches,
have been held under a claim of private
ownership by Indigenous Cultural
Communities/Indigenous People, have never
been public lands and are thus indisputably
presumed to have been held that way since
before the Spanish Conquest (IPRA, Sec. 3,
par.1).
The rights of Indigenous Cultural
Communities/Indigenous People to their
ancestral domains (which also include ancestral
lands) by virtue of native title shall be recognized
and respected (IPRA, Sec. 11).
The presumption of the land “never to have been
public land” arises when the title is held (a) as
far back as testimony or memory went and (b)
under a claim of private ownership (Cruz v. Sec.
of Environmental and Natural Resources, G.R.
No. 135385, December 6, 2000).
9. Emancipation Patent or Grant
– By virtue of Presidential Decree No. 27, tenant-
farmers are deemed owners of the land they till.
This is for the purpose of ameliorating the said
plight of tenant-farmers (PEÑA, supra at 41).
NOTE: P.D No. 27 has been superseded by the
Comprehensive Agrarian Reform Law (CARL)
approved on June 10, 1998.
PAST AND PRESENT
LEGISLATION ON LAND
REGISTRATION
● When the Philippines was discovered and
conquered by Spain, the Law of the Indies was
passed ordering that all lands became the
exclusive patrimony and dominion of the Spanish
Crown.
● Subsequently, the Ley Hipotecaria or the
Mortgage Law of 1893, otherwise known as
the “Spanish Mortgage Law” was established
providing a more systematic and scientific mode
of registering titles and deeds and other claims of
ownership.
● In 1984, the Spanish Mortgage Law and the Law
of Indies were partly amended by the Royal
Decree of 1894 otherwise known as the
“Maura Law” requiring that all agricultural lands
must be adjusted or registered otherwise the
same shall revert back to the State.
● During the American regime, the system of land
registration was simplified. The Philippine
Commission enacted Act No. 496 otherwise
known as the “Land Registration Act of 1903”
which was approved on November 6, 1902 and
became effective on January 1, 1903 placing all
grants of public land under the coverage of the
Torrens System of Property Registration. It also
 created the “Court of Land Registration” which the two relates to the transitory provisions on the
had exclusive jurisdiction to hear, determine, rights of American citizens and corporations
adjudicate and execute applications for original during the Commonwealth period at par with
registration. Filipino citizens and corporations.
● On February 11, 1913, Act No. 2259 otherwise ● Under Sec 103 of PD No. 1529 or the Property
known as “Cadastral Act of 1913” was enacted Registration Decree, it is provided that whenever
as supplement of Act No 496. Section 5 of the public land is alienated, granted, or conveyed to
said Act provides that when, in the opinion of the any person by the government, the same shall be
President, the public interest requires that title to brought forthwith under the operation of the
any lands be settled adjudicated, he shall order Decree.
the Director of Lands to make a survey thereof,
with notice to all persons claiming an interest
therein. Thereafter, the Director of Lands,
represented by the Solicitor General, shall LAND REGISTRATION
institute registration proceedings by filing a
petition in the proper court against the holders,
claimants, possessors, or occupants of such
lands, stating that the interests require that the LAND REGISTRATION
titles to such lands be settled and adjudicated.
A judicial or administrative proceeding, whereby a
● On June 11, 1978, Presidential Decree No.
person’s claim of ownership over a particular land is
1529 now known as “Property Registration
determined and confirmed or recognized, so that
Decree” was approved and enacted to update
such land and the ownership thereof may be
Land Registration Act and to codify various laws
recorded in a public registry.
relative to registration of property and to facilitate
effective implementation of the said laws. It
supersedes all other laws relative to registration CONCEPT AND DEFINITION
of property (Director of Lands vs Santiago, G.R. To register is to record or annotate. American and
No. L-41278, April 15, 1988). Spanish authorities are unanimous on the meaning
● The Decree substantially incorporated both the of the term "to register" as "to enter in a register; to
substantive and procedural aspects of the Land record formally and distinctly; to enroll; to enter in a
Registration Act of 1902 and widened the horizon list."
of the coverage to include: Judicial confirmation
of imperfect or incomplete titles (Section 14 In general, registration refers to any entry made in
paragraph 1); Cadastral Proceedings (Section the books of the registry (now Electronic Primary
51-58); Voluntary and Involuntary (Section 51- Entry Book [EPEB]), including both registration in its
77); the Certificates of Land Transfer and ordinary and strict sense, and cancellation,
Emancipation Patents (Section 104-106, PD 27); annotation, and even the marginal notes. In strict
the Reconstitution of Lost or Destroyed Titles acceptation, it pertains to the entry made in the
(Section 110); and the consulta (Section 117, PD registry which records solemnly and permanently
1529) (MOGELLO, Guidelines and Procedures in the right of ownership and other real rights. Simply
Land Titles and Deeds, 2019 Edition). stated, registration is made for the purpose of
notification (Cabiling v. Fernandez, G.R. No.
LAND OF PUBLIC DOMAIN 183133, July 26, 2010).
● In 1903, the United States colonial government,
The mere presentation to the office of the Register
through the Philippine Commission, passed Act
of Deeds of a document on which acknowledgement
No. 926, the first Public Land Act. The law
of receipt is written is not equivalent to recording or
governed the disposition of lands of the public
registering the real property (Po Sun Tun v. Price
domain.
and The Provincial Government of Leyte, G.R. No.
● Act No. 926 was superseded in 1919 by Act No. 31346, December 28, 1929).
2874, the second Public Land Act. This new
law was passed under the Jones Law. It was
more comprehensive in scope but limited the
exploitation of agricultural lands to Filipinos and
Americans and citizens of other countries which
gave Filipinos the same privileges.
● After the passage of the 1935 Constitution, Act
No. 2874 was amended in 1936 by CA No. 141,
the present Public Land Act approved on
November 7, 1936, which is essentially the same
as Act No. 2874. The main difference between
 REGISTRATION OF TITLE V. LAWS IMPLEMENTING LAND
RECORDING OF EVIDENCE REGISTRATION
REGISTRATION OF RECORDING OF 1. Property Registration Decree (P.D. No. 1529, as
TITLE EVIDENCE amended);
2. Cadastral Act (Act N. 2259, as amended);
State provides a public Involves the recording of 3. Public Land Act (C.A. No. 141, as amended);
record of the title itself deeds of conveyance 4. Emancipation Patent or CARP of 1972 (P.D. No.
upon which a and other instruments, 27);
prospective purchaser without guaranteeing the 5. Comprehensive Agrarian Reform Law of 1988
or someone else title, leaving to the (R.A.6657, as amended); and
interested may rely prospective purchasers 6. Indigenous Peoples Rights Act or IPRA of 1997
or other persons (R.A. 8371).
interested to examine
the instruments in the NATURE OF LAND REGISTRATION
records and formulate Judicial proceedings for the registration of lands
their own conclusions as throughout the Philippines shall be in rem and shall
to their effect on the title. be based on the generally accepted principles
(PEÑA, supra at 7). underlying the Torrens system (P.D. 1529, Sec. 2,
Par. 1).
SYSTEMS OF REGISTRATION IN THE
Jurisdiction in rem cannot be acquired unless there
PHILIPPINES: (STU) be a constructive seizure of the land through
1. System under the Spanish Mortgage Law; publication and service of notice (Republic v. CA and
2. Torrens System; and Ribaya, G.R. No. 113549, July 5, 1996).
3. System of Recording for Unregistered Land
(PEÑA, supra at 4). PURPOSES OF LAND REGISTRATION
(QC-NHP-MEG)
REGISTRATION UNDER THE SPANISH
1. To Quiet title to land and stop forever any
MORTGAGE LAW DISCONTINUED question as to the legality of said title (Legarda
P.D. 892 was issued decreeing the discontinuance v. Saleeby, G.R. No. L-8936, October 2, 1915);
of the system of registration under the Spanish 2. To serve as a Constructive notice to all persons
Mortgage Law and the use of Spanish Title as from the time of such registering, filing or
evidence in land registration proceedings entering of every conveyance, mortgage, lease,
(AGCAOILI, Land Titles and Deeds (2018), p. 30). lien, attachment, order, judgment, instrument, or
entry affecting registered land (P.D. 1529, Sec.
NOTE: Lands granted under Spanish Mortgage 52);
Law, which are not yet covered by certificate of title 3. To Notify and protect the interests of strangers
under Torrens System are considered as to a given transaction, who may be ignorant
unregistered lands (P.D. 1529, Sec.3). thereof (Casica v. Villasoca, G.R. No. L-9590,
April 30, 1957);
Hereafter, all instruments affecting lands originally 4. To enable every registered owner and every
registered under the Spanish Mortgage Law may be subsequent purchaser of registered land taking
recorded under Section 113 of this Decree, until the a certificate of title for value and in good faith to
land shall have been brought under the operation of Hold the same free from all encumbrances,
the Torrens Title. except those registered (P.D. 1529, Sec. 44);
5. To Prevent fraudulent transactions. No voluntary
The books of registration for unregistered lands instrument shall be registered by the Register of
provided under Section 194 of the Revised Deeds, unless the owner's duplicate certificate
Administrative Code, as amended by Act No. 3344, is presented with such instrument (P.D. 1529,
shall continue to remain in force; provided, that all Sec. 53);
instruments dealing with unregistered lands shall 6. To enable the Register of Deeds to Maintain a
henceforth be registered under Sec 113 of this repository (Primary Entry Book) of all
Decree (MOGELLO, Guidelines and Procedures in instruments affecting registered land (P.D. 1529,
Land Titles and Deeds (2019), p. 10). Sec. 56);
7. To issue a certificate of title to the owner, which
shall be the best Evidence of his ownership of
the land described therein (Lee Tek Sheng v.
CA, G.R. No. 115402, July 15, 1998); and
8. To Guarantee the integrity of land titles and to
protect their indefeasibility once the claim of
ownership is established and recognized
(Traders Royal Bank v. CA. G.R. Nos. 114299
and 118862. September 24, 1999).
NOTE: Registration does not vest title. It is not a
mode of acquiring ownership but is merely evidence
of such title over a particular property. It does not
give the holder any better right than what he actually
has, especially if the registration was done in bad
faith. The effect is that it is, as if, no registration was
made at all (Avila v. Tapucar, G.R. No. L-45947,
August 27, 1991).
It is emphasized that the registration of a patent
under the Torrens System merely confirms the
registrant's title. It does not vest title where there is
none because registration under this system is not a
mode of acquiring ownership (Heirs of Spouses De
Guzman v. Heirs of Bandong, G.R. No. 215454,
August 9, 2017). Registration does not give the
registrant a better right than what he had prior to
registration (Duque-Rosario v. Banco Filipino
Savings and Mortgage Bank, G.R. No. 140528,
December 7, 2011).
Where a document so registered is invalid or legally
defective, registration will not in any way render it
valid or cure its defect (Santos v. Robledo, G.R. No.
L-9197, October 22, 1914).
EFFECTS OF REGISTRATION:
1. Registration in the public registry is notice to the
whole world;
2. The act of registration is the operative act to
convey or affect the land insofar as third persons
are concerned; and
3. While registration operates as a notice of the
deed, contract, or instrument to others, it does
not as to its validity nor converts an invalid
instrument into a valid one; neither does it
recognize a valid and subsisting interest in the
land (AGCAOILI, supra at 44).
ADVANTAGES OF REGISTRATION: (SP-
SiR-B):
1. Secures title;
2. Protects against fraud;
3. Simplifies dealings;
4. Restores the estates to its just value, whose
depreciation is caused by some blur, technical
defect; and
5. Bars the recurrence of faults in the title (Legarda
v. Saleeby, G.R. No. L-8936, October 2, 1915).
BURDEN OF PROOF
The burden of proof in land registration cases rests
on the applicant who must show clear, positive, and
convincing evidence that his alleged possession and
occupation were of the nature and duration required
by law. Bare allegations, without more, do not
amount to preponderant evidence that would shift
the burden to the oppositor (Republic v. Enciso, G.R.
No. 160145, November 11, 2005).
TORRENS SYSTEM
TORRENS SYSTEM
A system of registration of transaction with interest
in land whose declared object is, under government
authority, to establish and certify to the ownership of
an absolute and indefeasible title to realty, and to
simplify its transfer (AGCAOILI, supra at p. 9-10).
Nature: It is judicial in nature (P.D. 1529, Sec. 2).
HISTORY AND INTRODUCTION
It was devised and first introduced in South Australia
by Sir Robert Richard Torrens in 1857. It was
introduced in the Philippines by Act No. 496, which
took effect on January 1, 1903 (Sotto v. Sotto, G.R.
No. 17768, September 1, 1922).
It was later amended and superseded by P.D. 1529,
which took effect on June 11, 1978, otherwise known
as the Property Registration Decree. Its object is
to do away with the delay, uncertainty, and expense
of the old conveyancing system. It updated the Land
Registration Act and codified the various laws
relative to registration (AGCAOILI, supra at 20).
ADVANTAGES OF THE TORRENS
SYSTEM: (PRIMEA-MAKGITS)
1. Protects against encumbrances not noted on the
Torrens certificate;
2. Reduces records enormously;
3. Instantly reveals ownership;
4. Makes fraud almost impossible;
5. Eliminates repeated examination of titles;
6. Abolishes endless fees;
7. Makes possible the transfer of titles or of loans
within the compass of hours instead of a matter
of days and weeks;
8. Assures;
9. Keeps up the system without adding to the
burden of taxation (because the beneficiaries
pay the fees);
10. Gives practically eternal title as the state insures
perpetually (PEÑA, supra at 45);
11. It eliminates Tax titles; and
12. It furnishes State title insurance instead of
private title insurance.
The purpose of land registration is not the
acquisition of title but only the registration of title,
which the applicant already possessed over the
land. Registration was never intended as a means of
acquiring ownership (Republic v. CA, G.R. No. L-
43105, August 31, 1984).
PURPOSES OF THE TORRENS
SYSTEM: (QUIPPERS)
1. To Quiet title to land; to put a stop forever to any
question of the legality of the title, except claims
which were noted at the time of registration, in
the certificate, or which may arise subsequent
thereto (Legarda v. Saleeby, G.R. No. L-8936,
October 2, 1915);
2. To relieve the land of Unknown liens or claims,
just or unjust, against it except Statutory Liens
under Section 44 of P.D. 1529;
3. To create Indefeasible and imprescriptible title
binding the whole world (NOBLEJAS, supra at
3);
4. To Prevent fraudulent claims;
5. To provide means of Publication or notice to
third persons;
6. To Establish priority in right. – “First in Time,
Stronger in Right” (Primus Tempore, Potior
Jure);
7. To facilitate transactions relative thereto by
giving the public the right to Rely upon the face
of the Torrens certificate of title and to dispense
with the need of inquiring further, except when
the party concerned has actual knowledge of
facts and circumstances that should imply a
reasonably cautious man to make such further
inquiry; and
8. To provide Stability to land titles (AGCAOILI,
Land Titles and Deeds, supra at 10-12).
NOTE: Registration is not equivalent to legal
title. (Wee v. Mardo, G.R. No. 202414, June 4,
2014)
Under the Torrens system, registration only
gives validity to the transfer or creates a lien
upon the land. It merely confirms, but does not
confer, ownership (Lu v. Manipon, G.R. No.
147072, May 7, 2002).
EFFECTS OF ISSUANCE OF TITLE:
(TRI-IC)
1. The land is placed under the operation of
Torrens System; (P.D. 1529, Sec. 3);
2. Land is Relieved from all claims except those
noted thereon and provided by law; (P.D. 1529,
Sec. 46);
3. Title to the land becomes Imprescriptible; (P.D.
1529, Sec. 47);
4. The land becomes Incontrovertible and
indefeasible (P.D. 1529, Sec. 32); and
5. The certificate of title is not subject to Collateral
attack. (P.D. 1529, Sec. 48).
REGISTRATION UNDER ACT NO. 3344
INEFFECTIVE AGAINST THIRD
PERSONS
Section 194 of the Revised Administrative Code, as
amended by Act No. 3344, provides for the
registration of deeds or instruments relating to lands
not registered under the Torrens system. If a parcel
of land covered by Torrens title is sold, but the sale
is registered under Act No. 3344 and not under the
Land Registration Act, the sale is not considered
registered and the registration of the deed does not
operate as constructive notice to the whole world
(Melencion v. CA, G.R. No. 148846, September 25,
2007).
REGISTRATION UNDER THE TORRENS
SYSTEM A PROCEEDING IN REM
A proceeding in rem is when the object of the action
is to bar indifferently all who might be minded to
make an objection of any sort against the right
sought to be established, and if anyone in the world
has a right to be heard on the strength of alleging
facts which if true, shows an inconsistent interest
(AGCAOILI, supra at 22).
A land registration is a proceeding in rem, and
jurisdiction in rem cannot be acquired unless there
be constructive seizure of the land through
publication and service of notice (Republic v. CA,
G.R. No. 113549, July 5, 1996).
Registration under the Torrens System constitutes,
at the very least, constructive notice to any boundary
owner of who is his neighbor (Francisco v. CA, G.R.
No. L-35787, April 11, 1980).
TORRENS TITLE
A Torrens title is the certificate of ownership issued
under the Torrens system of registration by the
government, through the Register of Deeds, naming
and declaring the owner in fee simple of the real
property described therein, free from all liens and
encumbrances except as may be expressly noted
thereon or otherwise reserved by law (ALBANO,
Civil Law Reviewer Revised Edition (2013), p. 798
[hereinafter ALBANO, Civil Law Reviewer]).
Legally defined, a certificate of title is the transcript
of decree of registration made by the Register of
Deeds (Manotok IV v. Heirs of Homer Barque, G.R.
Nos. 162335 and 162605, December 18, 2008,
citing PNB v. Tan Ong Zse).
Probative Value: Torrens Title may be received in
evidence in all courts of the Philippines, and shall be
conclusive as evidence with respect to the
ownership of the land described therein and other
matters which can be litigated and decided in land
registration proceedings (AGCAOILI, supra at 12).
TWO TYPES OF TORRENS
CERTIFICATE OF TITLE:
1. Original Certificate of Title (OCT)
– The first title issued in the name of the
registered owner by the Register of Deeds
covering a parcel of land, which had been
registered under the Torrens System by virtue of
a judicial or administrative proceeding.
It consists of one original copy filed in the
Register of Deeds, and the owner’s duplicate
certificate delivered to the owner (P.D. 1529,
Sec. 39).
2. Transfer Certificate of Title (TCT)
– The title issued by the Register of Deeds in
favor of a transferee to whom the ownership of
a registered land has been transferred by any
legal mode of conveyance (e.g. sale, donation).
It also consists of an original and an owner’s
duplicate certificate. (P.D. 1529, Sec. 43).
AGENCIES IMPLEMENTING LAND
REGISTRATION PROCEEDINGS UNDER
THE TORRENS SYSTEM:
1. Courts (RTC acting as Land Registration Court);
2. Department of Environment and Natural
Resources (DENR);
3. Department of Justice (DOJ) through the Land
Registration Authority (LRA) and its Register of
Deeds (RD);
4. Department of Agrarian Reform (DAR); and
5. Department of Agriculture (DA).
JURISDICTION,
HEARING, JUDGMENT
IN ORDINARY LAND
REGISTRATION
JURISDICTION
GENERAL RULE: The Court of First Instance (now
the Regional Trial Courts) shall have exclusive
jurisdiction over all applications for original
registration of title to lands, including improvements
and interests therein, and over all petitions filed after
original registration of title, with power to hear and
determine all questions arising upon such
applications or petitions (MOGELLO, Guidelines and
Procedures in Land Titles and Deeds (2019), p. 8).
EXCEPTION: (Delegated Power)
The Metropolitan Trial Courts (MeTCs); Municipal
Courts in Cities (MTCCs); Municipal Trial Courts
(MTCs); Municipal Circuit Trial Courts (MCTCs)
have jurisdiction to hear and determine cadastral or
land registration cases by virtue of the delegated
jurisdiction granted by the Supreme Court (Section
34, B.P. Blg. 129 as amended by R.A. No. 7691)
based on the following instances:
1. Where the lot sought to be registered is not
the subject of controversy or opposition; or
2. Where the lot is contested but the value
thereof does not exceed P100,000.00, such
value to be ascertained by the affidavit of the
claimant or by the agreement of the
respective claimants, if there be more than
one, or from the corresponding tax
declaration of the real property.
VENUE
Actions affecting title to or possession of real
property, or interest therein shall be commenced and
tried in the proper court which has jurisdiction over
the area wherein the real property involved , or a
portion thereof, is situated (RULES OF COURT,
RULE 4, Sec. 1).
HEARING
Applications for registration shall be heard in the
regional trial court or, in proper cases, in first level
courts, in the same manner and shall be subject to
the same procedure as established in the Property
Registration Decree (AGCAOILI, supra at 173).
NOTE: While a referee can receive evidence and
objections, it has no power to rule on the case. Its
main duty is to receive evidence and submit its
findings and recommendations to the court (P.D.
1529, Sec. 27).
JUDGMENT
All conflicting claims of ownership and interest in the
land subject of the application shall be determined
by the court (P.D. 1529, Sec. 29).
The court is now authorized to hear and decide not
only non-controversial cases but even contentious
issues which used to be beyond its competence
(Ligon v. CA, G.R. No. 107751, June 1, 1995).
P.D. 1529 eliminated the distinction between the
general jurisdiction vested in the Regional Trial
Court and the limited jurisdiction formerly conferred
upon it when acting merely as cadastral court. Thus,
the court may resolve issues other than those strictly
pertaining to land registration in cases (ALBANO,
supra at 817).
DUTIES OF THE COURT:
1. Render judgment, declare the same final, and
cause the decision’s entry (P.D. 1529, Sec. 29);
and
2. Order the LRA to issue a decree of registration
(P.D. 1529, Sec. 30).
Only claimed property or a portion thereof can be
adjudicated. If the applicant asserts ownership to
and submits evidence only for a portion of a lot, the
inclusion of the portion not claimed by the applicant
is void and of no effect for a land registration court
has no jurisdiction to decree a lot to a person who
puts no claim to it and who never asserted any right
of ownership over it (Almarza v. Arguelles, G.R. No.
L-49250, December 21, 1987).
The court may reverse its decision even after the
LRA has already issued the decree of registration
(Gomez v. CA, G.R. No. 77770, December 15,
1988).
The judgment becomes final upon the lapse of
fifteen (15) days counted from receipt of notice of the
judgment (B.P. 129, Sec. 39; Heirs of Cornelio
Labrada v. Monsanto, G.R. No. L-66242, August 31,
1984). However, notwithstanding the lapse of the 15-
day period from receipt of judgment by the parties,
the court continues to retain control over the case
until the expiration of one (1) year after the entry of
the decree of registration by the LRA (Republic v.
Associacion Benevola de Cebu, G.R. No. 77243,
October 26, 1989; P.D. 1529, Sec. 32).
LAND REGISTRATION
COMMISSION
1. LAND REGISTRATION AUTHORITY
(LRA)
Agency of the government charged with the
execution of laws relative to the registration of
lands and under executive supervision of the
DOJ (P.D. 1529, Sec. 4).
Functions of the LRA: (SAC)
a. Extend Speedy and effective assistance to
Department of Agrarian Reform, the Land
Bank and other agencies in the
implementation of the land reform program;
b. Extend Assistance to courts in ordinary and
cadastral registration proceedings; and
c. Be the Central repository of records relative
to original registration of lands titled under
the Torrens System, including subdivision
and consolidation plans of titled lands (P.D.
1529, Sec. 6 (2)).
Functions of the LRA Administrator
(formerly Commissioner):
a. Issue decrees of registration pursuant to
final judgments of the courts in land
registration proceedings and cause the
issuance by the Registers of Deeds of the
corresponding certificates of title;
b. Exercise supervision and control over all
Registers of Deeds and other personnel of
the Commission;
c. Resolve cases elevated en consulta by or
on appeal from the decision of the Register
of Deeds;
d. Exercise executive supervision over all
clerks of court and personnel of the courts
with respect to the discharge of their duties
and functions in relation to the registration of
lands;
e. Implement all orders, decisions, and
decrees promulgated relative to the
registration of lands and issue, subject to the
approval of the Secretary of Justice, all
needful rules and regulations; and
f. Verify and approve subdivision,
consolidation, and consolidation-subdivision
survey plans of properties titled under Act
No. 496 and P.D. 1529 except those
covered by P.D. 957; (P.D. 1529, Sec. 6);
and
g. Act as Clerk of Court in land registration
proceedings.
NOTE: Recognizing the overlapping of
functions, P.D. 239, dated July 9, 1973, was
implemented stating that the LRA was no longer
authorized to approve original survey plans for
original registration. Thus, the Land
Management Bureau (LMB) is now authorized to
verify and approve original survey plans
(MOGELLO, Guidelines and Procedures in Land
Titles and Deeds (2019), p. 22).
Ministerial Duty of LRA to Issue Decree of
Registration
The duty of the LRA to issue a decree of
registration is ministerial only in the sense that
they act under the orders of the court, and the
 decree must be in conformity with the decision
of the court and with the date found in the record.
However, if they are in doubt upon any point in
relation to the preparation and issuance of the
decree or if they have personal knowledge of the
fact that the property subject of the decision is
already covered by a decree of registration, it is
their duty to refer the matter to the court.
(AGCAOILI, supra at 41).
NOTE: The issuance by the Land Registration
Authority Officials of a decree of registration is not
purely ministerial in cases where they find that such
would result to the double titling of the same parcel
of land (MOGELLO, Guidelines and Procedures in
Land Titles and Deeds (2019), p. 14).
2. REGISTER OF DEEDS (RD)
The public repository of records of instruments
affecting registered or unregistered lands and
chattel mortgages in the province or city wherein
such office is located (P.D. 1529, Sec. 10).
NOTE: There shall be at least one Register of
Deeds for each province and one for each city
(P.D. 1529, Sec. 7).
Functions and Duties of the Register of
Deeds: (ISDAK)
a. Immediately register an instrument
presented for registration dealing with real
or personal property, which complies with all
the requisites for registration;
b. See to it that the instrument bears the proper
documentary and science stamps and that
the same are properly cancelled;
c. Deny registration, if the instrument is not
registrable (on its face), and inform the
presentor of such denial in writing, stating
the ground or reason therefor;
d. Advise the presentor (denied of registration)
of his right to appeal by consulta; and
e. Prepare and Keep in every Registry an
index system which contains the names of
all registered owners alphabetically
arranged, and all the lands respectively
registered in their names (P.D. 1529, Sec.
10 and Sec. 12).
The Registry of Deeds is the repository of titles,
deeds, conveyances, court orders and other
instruments used as basis in the subsequent
registration. Their duty includes the obligation to
accept documents presented for registration; assign
the corresponding number based on the Electronic
Primary Entry Book (EPEB), process, examine and
release the said document within a reasonable
period of time. Titles kept in the registry are arranged
numerically (according to the title number) and not
based on the name of the registered owner
(MOGELLO, Guidelines and Procedures in Land
Titles and Deeds (2019), p. 14).
MINISTERIAL DUTY OF THE RD TO
REGISTER
The function of the Register of Deeds with reference
to the registration of deeds, encumbrances,
instruments, and the like is ministerial in nature
(Baranda v. Gustilo, G.R. No. 81163, September 26,
1988).
The Register of Deeds is entirely precluded from
exercising his personal judgment and discretion
when confronted with the problem of whether to
register a deed or instrument on the ground that it is
invalid. The determination of whether a document is
valid or not is a function that belongs properly to a
court of competent jurisdiction (AQUINO, supra at
11).
The law on registration does not require that only
valid instruments shall be registered. If the purpose
of registration is merely to give notice, then
questions regarding the effect or invalidity of
instruments are expected to be decided after, not
before registration. It must follow as a necessary
consequence that registration must first be allowed,
and its validity or effect is litigated afterwards
(Almirol v. The Register of Deeds of Agusan, G.R.
No. L-22486, March 20, 1968).
INSTANCES WHEN RD MAY DENY
REGISTRATION: (NO³-MORE-CIV-PRE)
1. When the document is Not verified and
acknowledged before a notary public or other
public officer authorized by law to take
acknowledgment (Gallardo v. IAC, G.R. No. L-
67742, October 29, 1987);
2. When the land involved is a Non-registrable
land;
3. Where required certificates or documents are
Not submitted;
4. Where there is More than one (1) copy of the
owner’s duplicate certificate of title and not all
such copies are presented in the Register of
Deeds (i.e., when there are co-owner’s
duplicates of the same title);
5. Where the property is presumed to be Conjugal
but the instrument of conveyance bears the
signature of only one spouse;
6. Where the voluntary instrument bears on its face
an Infirmity;
7. Where the Validity of the instrument sought to be
registered is in issue in a pending court suit
(AGCAOILI, supra at 48-49);
8. Where the adverse claim of ownership over a
parcel of land is based on Prescription and
adverse possession (Estrella v. Register of
 Deeds of Rizal, G.R. No. L-12614, January 29,
1960);
9. Where the cancellation of an adverse claim is
based on a mere Request and not upon the
order of the court (Sajonas v. CA, G.R. No.
102377, July 5, 1996).
“EN CONSULTA”
When the Register of Deeds is in doubt with regard
to the proper step to be taken or memorandum to be
made in pursuance of any deed, mortgage or other
instrument presented to him for registration, or
where any party in interest does not agree with the
action taken by the Register of Deeds with reference
to any such instrument, the question shall be
submitted to the Commissioner of Land Registration
by the Register of Deeds, or by the party in interest
through the Register of Deeds (P.D. 1529, Sec.
117).
A deed of sale executed in a place other than where
the property is located does not affect the extrinsic
validity of the instrument as long as the notary public
concerned has authority to acknowledge the
document executed within his territorial jurisdiction.
Notarial acknowledgment attaches full faith and
credit to the document and also vests upon it the
presumption of regularity (Sales v. CA, G.R. No. L-
40145, July 29, 1992).
PROCEDURE FOR “EN CONSULTA”
REGISTRANT
Register of Deeds
(Sec. 117, P.D. No. 1529)
Land Registration Authority
Court of Appeals
(Rule 43, Rules of Court)
Supreme Court
(Rule 45, Rules of Court)
MODE OF
REGISTRATION
1. Judicial Legalization
a. Judicial Confirmation of Imperfect or
Incomplete Title (C.A. 141 as amended,
Sec. 48 (b));
b. Voluntary or Ordinary Land Registration
(P.D. 1529); and
c. Cadastral Proceedings (P.D. 1529).
2. Administrative Legalization
a. Filing of application at CENRO/ PENRO;
b. Forwarded to the Registration Director
and/or DENR for the issuance of patent and
Register of Deeds for issuance of OCT; and
c. Through the NCIP – For native title over
both ancestral lands and domains
(AGCAOILI, supra at 123).
CITIZENSHIP
REQUIREMENT
1. Natural Persons:
GENERAL RULE: Only Filipino Citizens can
acquire private or public agricultural lands.
(CONST., Art. XII, Sec. 7).
EXCEPTIONS:
a. In case of hereditary succession, aliens may
be a transferee of private lands (CONST.,
Art XII, Sec. 7); and
b. A natural-born citizen of the Philippines, who
has lost his Philippine citizenship may be a
transferee of private lands, subject to
limitations provided by law (CONS., Art XII,
Sec. 8).
Limitations:
a. Any natural-born citizen of the
Philippines who has lost his Philippine
citizenship and who has the legal capacity to
enter into a contract under Philippine laws
may be a transferee of a private land up to
a maximum area of one thousand (1,000)
square meters, in the case of urban land, or
one (1) hectare in the case of rural land, to
be used by him as his residence (B.P. Blg.
185, Sec. 2);
b. In the case of married couples, one of them
may avail of the privilege granted above;
provided, That if both shall avail of the same,
 the total area acquired shall not exceed the
maximum authorized (B.P. Blg. 185, Sec. 2);
c. In case the transferee already owns urban
or rural lands for residential purposes, he
shall still be entitled to be a transferee of
additional urban or rural lands for residential
purposes which, when added to those
already owned by him, shall not exceed the
maximum areas herein authorized (B.P. Blg.
185, Sec. 2);
d. A natural-born who has lost his
Philippine citizenship and who has the
legal capacity to enter into a contract under
Philippine laws may be a transferee of a
private land up to a maximum area of
five thousand (5,000) square meters in the
case of urban land or three (3) hectares in
the case of rural land to be used by him for
business or other purposes (R.A. No.
7042, Sec. 10, as amended by R.A.
No.8179);
e. In the case of married couples, one of them
may avail of the privilege granted. But if both
shall avail of the same, the total area
acquired shall not exceed the maximum
fixed (R.A. No. 7042, Sec. 10, as amended
by R.A. No. 8179); and
f. In case the transferee already owns
urban or rural land for business or other
purposes, he shall still be entitled to be a
transferee of additional urban or rural land,
which when added to those already owned
by him, shall not exceed the maximum areas
authorized (R.A. No. 7042, Sec. 10, as
amended by R.A. No.8179).
NOTE: The acquisition by aliens of private lands
in case of hereditary succession is not subject to
limitations (Republic v. CA and Sps. Lapiña,
G.R. No. 108998, August 24, 1994).
Aliens may lease Private Lands
While aliens are disqualified from acquiring
lands of public domain, they may however lease
private lands. (Id. at 191).
Citizens of the Philippines may lease not more
than five hundred (500) hectares, or acquire not
more than twelve (12) hectares thereof, by
purchase, homestead, or grant (CONST., Art.
XII, Sec. 3).
A lease to an alien for a reasonable period is
valid. So is an option giving an alien the right to
buy real property on condition that he is granted
Philippine citizenship. Aliens are not completely
excluded by the Constitution from use of lands
for residential purposes. Since their residence in
the Philippines is temporary, they may be
granted temporary rights such as a lease
contract which is not forbidden by the
Constitution. Should they desire to remain here
forever and share our fortune and misfortune,
Filipino citizenship is not impossible to acquire
(Philippine Banking Corporation v. Lui She, G.R.
No. L-17587, September 12, 1967, citing
Krivenko v. Register of Deeds (1947)).
The only instance where a contract of lease may
be considered invalid is, if there are
circumstances attendant to its execution, which
are used as a scheme to circumvent the
constitutional prohibition.
If an alien is given not only a lease of, but also
an option to buy, a piece of land, by virtue of
which the Filipino owner cannot sell or otherwise
dispose of his property, this to last for 50 years,
then it becomes clear that the arrangement is a
virtual transfer of ownership whereby the owner
divests himself in stages not only of the right to
enjoy the land (jus possidendi, jus utendi, jus
fruendi, and jus abutendi) — rights, the sum of
which make up ownership. It is just as if today
the possession is transferred, tomorrow the use,
the next day the disposition, and so on, until
ultimately all the rights of which ownership is
made up are consolidated in an alien (Philippine
Banking Corporation v. Lui She, G.R. No. L-
17587, September 12, 1967; Llantino v. Co
Liong Chong, G.R. No. L-29663, August
20,1990).
Filipino Vendor Cannot Recover Land Sold
to an Alien (in pari delicto)
The question was answered in the negative in
the early case of Rellosa v. Gaw Chee Hun
because the Filipino vendor was in pari delicto
with the alien vendee (AGCAOILI, supra at 187;
Rellosa v. Gaw Chee Hun, G.R. No. L-1411,
September 29, 1953).
Effect of Subsequent Naturalization of the
Transferee
If land is invalidly transferred to an alien who
subsequently becomes a Filipino citizen or
transfers it to a Filipino, the flaw in the original
transaction is considered cured and title of the
transferee is rendered valid (Borromeo v.
Descallar, G.R. No. 159310, February 24,
2009).
Rationale: The ban on aliens is intended to
preserve the nation’s land for future generations
of Filipinos (Muller v. Muller, G.R. No. 149615,
August 29, 2006).
 Alienation in Favor of Foreign Government
to be Used as Chancery or Residence of
Diplomatic Representatives
The prohibition in the Constitution against
alienation of lands in favor of aliens does not
apply to alienation of the same in favor of foreign
governments to be used as chancery and
residence of its diplomatic representatives.
As part of its treaty obligation under International
Law, the State shall either facilitate the
acquisition on its territory, the premises
necessary for the mission by a sending state, or
assist the latter in obtaining accommodations in
the country (Vienna Convention on Diplomatic
Relations, Art. 21).
The State shall also, when necessary, assist
missions in obtaining accommodations for its
members (Vienna Convention on Diplomatic
Relations, Art. 21).
Foreigners are Allowed to Purchase
Condominium Units
Aliens may acquire condominium units and
shares in condominium corporations up to no
more than 40% of the total and outstanding
capital stock of a Filipino-owned or controlled
corporation (R.A. 4726, The Condominium Act,
Sec. 5).
Under this setup, the ownership of the land is
legally separated from the unit itself, therefore
the constitutional proscription against aliens
owning real property does not apply (Hulst v. PR
Builders, Inc., G.R. No. 156364, September 25,
2008).
2. Corporations
GENERAL RULE: Private corporations or
associations are not legally qualified to own
alienable lands of public domain except through
lease (CONST., Art. XII, Sec. 3).
EXCEPTION: By lease, for a period not
exceeding twenty-five (25) years, renewable for
not more than twenty-five (25) years, and not to
exceed one thousand (1,000) hectares in area
(CONST., Art. XII, Sec. 3).
EXCEPTION TO THE EXCEPTION:
Possessory claims to the property acquired
before the 1935 Constitution prohibited the
alienation of all lands of the public domain,
except agricultural lands, subject to vested
rights existing at the time of its adoption (Atok-
Big Wedge Mining Co. v. CA and Consi, G.R.
No. 88883, January 18, 1991).
If the predecessors-in-interest of the corporation
have been in possession of the land in question
since June 12, 1945 or earlier, then it may
rightfully apply confirmation of title to the land.
That vested right has to be respected (Director
of Lands v. IAC and Acme Plywood & Veneer
Co. Inc., G.R. No. 73002, December 29, 1986).
NOTE: Filipino corporations and
associations may acquire private land.
The prohibition does not apply to land no longer
public land and are thus private land (Director
of Lands v. IAC and Acme Plywood & Veneer
Co. Inc., G.R. No. 73002, December 29, 1986).
Limitations:
a. Private Lands
i. At least 60% of whose capital is owned
by Filipino citizens to acquire private
land;
ii. Restricted as to the extent reasonably
necessary to enable it to carry out
purpose which it was created;
iii. If engaged in agricultural – restricted to
1,024 hectares; and
iv. Applicable to Filipino corporations only
(CONST., Art. XII, Sec. 2).
NOTE: The purpose of the sixty per centum
(60%) requirement is obviously to ensure
that corporations or associations allowed to
acquire agricultural land or to exploit natural
resources shall be controlled by Filipinos;
and the spirit of the Constitution demands
that in the absence of capital stock, the
controlling membership should be
composed of Filipino citizens (Register of
Deeds of Rizal v. Ung Siu Si Temple, G.R.
No. L-6776, May 21, 1955).
b. Patrimonial Property of State
i. Lease for 25 years renewable;
ii. Limited to 1,000 hectares; and
iii. Applicable to both Filipino and foreign
companies (CONST., Art. XII, Sec. 3).
Foreign Corporation: It is disqualified to own
lands in the Philippines. It is also disqualified to
own rights to ownership to such lands.
AGCAOILI, supra at 189).
Religious Association Controlled by Non-
Filipinos: The Constitution makes no exception
in favor of religious associations. To permit
religious associations controlled by non-Filipinos
to acquire agricultural lands would be to drive
the opening wedge to revive alien religious land-
holdings in the country (AGCAOILI, supra at
184).
 Corporation Sole: It may acquire and register
private agricultural land. It has “no nationality”,
thus the constitutional proscription against
private corporations acquiring agricultural lands
will not apply. (Roman Catholic Apostolic
Administrator of Davao, Inc. v. Land Registration
Commission, G.R. No. L-8451, December 20,
1957).
CLASSIFICATION OF
LAND
1. Public or Private;
2. Alienable or Inalienable;
3. Registered or Unregistered; and
4. Registrable or Non-registrable (AGCAOILI,
supra at 206).
GOVERNMENT LANDS
Government land includes public land and also all
other lands of the government already reserved or
devoted to public use or subject to private right
(Montano v. Insular Government, G.R. No. 3714,
January 26, 1909).
PUBLIC LANDS
Public land is equivalent to public domain. It does not
by any means include all lands of government
ownership, but only so much of said lands as are
thrown open to private appropriation and settlement
by homestead and other like general laws (Montano
v. Insular Government, G.R. No. 3714, January 26,
1909).
Land is considered of public dominion if it either: (a)
is intended for public use; or (b) belongs to the State,
without being for public use, and is intended for
some public service or for the development of
national wealth. Land belonging to the State that is
not of such character, or although of such character
but no longer intended for public use or public
service forms part of the patrimonial property of the
State.
PRIVATE LANDS
Land that is other than part of the patrimonial
property of the State, provinces, cities, and
municipalities of private ownership if it belongs to a
private individual (AGCAOILI, supra at 195).
Power to Classify Lands is an Executive
Prerogative
The classification of public lands is an exclusive
prerogative of the executive department and not of
the courts (AGCAOILI, Property Registration Decree
and Related Laws (Land Titles and Deeds) (2018),
p.193). The classification and reclassification of
public lands into alienable or disposable, mineral or
forest land is the exclusive prerogative of the
Executive Department, and is exercised by the latter
through the President, or such other persons vested
with authority to exercise the same on his behalf
(Republic v. Heirs of Cabrera, G.R. No. 218418,
November 08, 2017).
The government, as the agent of the state, is
possessed with the plenary power as the persona in
law to determine who shall be the favored recipients
of public lands, as well as under what terms they
may be granted such privilege, not excluding the
placing of obstacles in the way of their exercise of
what otherwise would be ordinary acts of ownership
(Gonzaga v. CA, G.R. No. L-27455, June 28, 1973).
In order to prove that the parcel of land is part of the
disposable and alienable lands of the public domain,
a certification from the DENR-CENRO is
insufficient. What is required is the certification
from the DENR Secretary (Republic v. Josefino, G.R
No. 210341; July 1, 2015; Republic v. Spouses Go,
G.R. No. 197297, August 2, 2017).
Certifications issued by the CENRO, or specialists of
the DENR, as well as Survey Plans prepared by the
DENR containing annotations that the subject lots
are alienable, do not constitute incontrovertible
evidence to overcome the presumption that the
property sought to be registered belongs to the
inalienable public domain (Republic v. Mendiola,
G.R. No. 211144, December 13, 2017).
Neither does a survey plan. The fact that the land
has been privately surveyed is not sufficient to
prove its classification or alienable character. While
the conduct of a survey and the submission of the
original tracing cloth plan are mandatory
requirements for applications for original registration
of land under P.D. 1529, they only serve to establish
the true identity of the land and to ensure that the
property does not overlap with another one covered
by a previous registration. These documents do not,
by themselves, prove alienability and disposability of
the property (Republic v. Nicolas, G.R. No. 181435,
October 2, 2017).
The trial court must be given a certified true copy of
the classification made by the DENR Secretary or
the President because it is the only acceptable and
sufficient proof of the alienable and disposable
character of the land (Dumo v. Republic, G.R. No.
218269, June 6, 2018). Failure to present a certified
true copy of the original classification approved by
the DENR secretary is fatal in securing registration
of title (Republic v. Rovency Realty and
Development Corp., G.R. No. 190817, January 10,
2018).
ALIENABLE AND INALIENABLE LANDS
Whether or not land of public domain is alienable
and disposable primarily rests on the classification
of public lands made under the Constitution.
The 1987 Constitution adopted the classification
under the 1935 Constitution into agricultural, forest
or timber, and mineral, but added national parks.
The identification of lands according to their legal
classification is done exclusively by and through a
positive act of the Executive Department.
Under Section 2 Article XII of the 1987 Constitution,
only agricultural lands of the public domain may be
alienated; all other natural resources may not be.
(AGCAOILI, supra at 196).
REGISTRABLE LANDS
1. Alienable public agricultural lands (CONST., Art.
XII, Sec. 2); and
2. Private lands. (CIVIL CODE, Arts. 421, 425).
NOTE: Alienable and disposable lands of the State
fall into two (2) categories, to wit:
a) Patrimonial lands of the State, or those
classified as lands of private ownership
under Article 425 of the Civil Code, without
limitation; and
b) Lands of the public domain, or the public
lands as provided by the Constitution, but
with the limitation that the lands must only
be agricultural (AGCAOILI, supra at 196).
Only Alienable and Disposable (A and D) Lands
May be Subject to Disposition
The Court has time and again emphasized that there
must be a positive act of the government, such as
an official proclamation, declassifying inalienable
public land into disposable land for agricultural or
other purposes. In fact, Section 8 of CA No. 141
limits alienable or disposable lands only to those
lands which have been "officially delimited and
classified"(Secretary of DENR v. Yap, G.R. No.
167707, October 8, 2008).
For the purpose of their administration and
disposition, the lands of the public domain alienable
or open to disposition shall be classified, according
to the use or purposes to which such lands are
destined, as follows:
a. Agricultural;
b. Residential, commercial, industrial or for similar
productive purposes;
c. Educational, charitable, or other similar
purposes; and
d. Reservations for town sites and for public and
quasi-public use (C.A. 141, Sec. 9).
NOTE: Land so granted donated, or transferred to a
province, municipality, or branch or subdivision of
the Government shall not be alienated, encumbered,
or otherwise disposed of in a manner affecting its
title, except when authorized by Congress (C.A. 141,
Sec. 60).
NON-REGISTRABLE LANDS
Those found in Civil Code provisions dealing with
non-registrable properties (e.g., property of public
dominion) (CIVIL CODE, Art. 420).
SPECIFIC KINDS OF NON-
REGISTRABLE PROPERTIES OR
LANDS: (F²LAWN-M³P²G)
1. Forest or timberland, public forest, &
forest reserve (AGCAOILI, supra at 213);
Forest lands are inalienable and possession
thereof, no matter how long, cannot convert
the same into private property. Courts are
without jurisdiction to adjudicate lands within
the forest zone (Collado v. CA, G.R. No.
107764, October 4, 2002).
Timber licenses merely evidence a
privilege granted by the State to qualified
entities, and do not vest in the latter a
permanent or irrevocable right to the
particular concession area and the forest
products therein. They may be validly
amended, modified, replaced or rescinded
by the Chief Executive when national
interests so require (Tan v. Director of
Forestry, G.R. No. L-24548, October 27,
1983).
A forested area classified as forest land of
the public domain does not lose such
classification simply because loggers or
settlers have stripped it of its forest cover
(Amunategui v. Director of Forestry, G.R.
No. L-27873, November 23, 1983).
Without the official declaration that the
subject land is alienable and disposable or
proof of its declassification into disposable
agricultural land, the "unclassified public
forest lands" legal classification of the
subject land remains. Testimonial evidence
on the physical layout or condition of the
subject land — that it was planted with
coconut trees and beach houses had been
 constructed thereon — are not conclusive
on the classification of the subject land as
alienable agricultural land. Rather, it is the
official proclamation releasing the land
classified as public forest land to form part
of disposable agricultural lands of the public
domain that is definitive (Republic v.
Saromo, G.R. No. 189803, March 14, 2018).
2. Foreshore land & seashore
– Seashore, foreshore, and/or portions of
territorial waters and beaches, cannot be
registered (AQUINO, supra at 184);
3. Lakes
– Are part of public domain (CIVIL CODE, Art.
502(4));
4. Alluvial deposit along river when man-
made (CIVIL CODE, Art. 420(1); Art. 502(1));
5. Watershed
– The Constitution expressly mandates the
conservation and utilization of natural resources,
which includes the country’s watershed (Tan v.
Director of Forestry, G.R. No. L-24548, October
27, 1983);
6. Navigable rivers, streams & creeks (Id.at
246);
NOTE: In Maneclang v. IAC (G.R. No. L-66575,
September 30, 1986), the Supreme Court, ruled
that a creek defined as a recess or arm
extending from a river and participating in the
ebb and flow of the sea is a property belonging
to the public domain. This recent case will erase
all doubts whether a stream or a creek will have
to be navigable to be of public ownership.
Streams and creeks, whether navigable or not,
are of public dominion (161 RODRIGUEZ,
PROPERTIES OF PUBLIC DOMINION (Under
Art. 420 of the New Civil Code (1988), p. 480).
7. Mangrove swamps
– Mangrove swamps or mangrove should be
understood as comprised within the public
forests of the Philippines as defined in Section
1820, Administrative Code of 1917 (Director of
Forestry v. Villareal, G.R. No. L-32266, February
27, 1989);
8. Mineral lands
– Both under the 1987 Constitution and Section
2 of the Public Land Act, mineral lands are not
alienable and disposable (Lepanto Consolidated
Mining Co. v. Dumyung, G.R. No. L-31666, April
30, 1979).;
9. Military Reservations
– The reservation made segregates it from the
public domain and no amount of time in
whatever nature of possession could have ripen
such possession into private ownership
(Republic v. Marcos, G.R. No. L-32941, July 31,
1973);
10. Previously titled land;
11. Protected Areas (R.A. 7586, also known as
NIPAS Act of 1992); and
12. Grazing land
– While the 1987 Constitution does not
specifically prove that grazing lands are not
disposable, yet if such lands are part of a forest
reserve, there can be no doubt that the same are
incapable of registration (AQUINO, supra at
184).
NOTE: Foreshore and submerged areas "shall not
be alienated," unless they are classified as
"agricultural lands" of the public domain. The mere
reclamation of foreshore areas does not convert
these inalienable natural resources of the State into
alienable or disposable lands of the public domain
(Chavez v. Public Estates Authority, G.R. No.
133250, July 9, 2002).
There must be a law or presidential proclamation
officially classifying these reclaimed lands as
alienable or disposable and open to disposition or
concession. Moreover, these reclaimed lands
cannot be classified as alienable or disposable if the
law has reserved them for some public or quasi-
public use (Chavez v. Public Estates Authority, G.R.
No. 133250, July 9, 2002).
REGISTRATION
REGISTRATION
Registration means any entry made in the books of
the registry (now Electronic Primary Entry Book
[EPEB]), including both registration in its ordinary
and strict sense, and cancellation, annotation, and
even marginal notes. In its strict acceptation, it is the
entry made on the registry which records solemnly
and permanently the right of ownership and other
real rights (Cheng v. Genato, G.R. 129760,
December 29, 1998).
1. Original Registration
a. Voluntary
i. Property Registration Decree
 (P.D. 1529)
ii. Judicial Confirmation of Imperfect or
Incomplete Title (C.A. 141, Section 48) ORIGINAL
b. Involuntary REGISTRATION
i. Cadastral Proceedings

2. Registration under R.A. 8371 (Indigenous

Peoples Rights Act of 1997)

3. Subsequent Registration Parcel of Land

ORIGINAL V. SUBSEQUENT
REGISTRATION Survey of Parcel of Land
ORIGINAL SUBSEQUENT Payment of Realty Tax
REGISTRATION REGISTRATION

The right of ownership Proceeding where

or title to land is for the
first time made of
public record under
any of the existing
systems of registration
(PEÑA, supra at 11).
incidental matters after Approval of Survey Plan by the Department of
original registration may Environment and Natural Resources (DENR)
be brought before the
Land Registration Court
by way of motion or
petition filed by the Filing of Application for Original Registration
registered owner or a
party in interest (PEÑA,
supra at 12).

JUDICIAL ADMINISTRATIVE

Filed with the File with the DENR

Regional Trial Court (for issuance of
or Municipal Trial Patent Title)
Court

Land Registration
Authority

Issuance of Original Certificate of Title (OCT)

Register of Deeds

NATURE
Judicial proceedings for the registration of lands
throughout the Philippines shall be in rem and shall
be based on the generally accepted principles
underlying the Torrens system (P.D. No. 1529, Sec.
2).
JURISDICTION
GENERAL RULE: Courts of First Instance (now
Regional Trial Court) shall have exclusive
jurisdiction over all applications for original
registration of title to lands, including improvements
and interests therein, and over all petitions filed after
original registration of title, with power to hear and
determine all questions arising upon such
applications or petitions. The court through its clerk
of court shall furnish the Land Registration
Commission with two certified copies of all
pleadings, exhibits, orders, and decisions filed or
issued in applications or petitions for land
registration, with the exception of stenographic
notes, within five days from the filing or issuance
thereof (P.D. No. 1529, Sec. 2).
EXCEPTION: Delegated Jurisdiction to the
Metropolitan Trial Courts (MeTCs); Municipal Trial
Courts in Cities (MTCCs); Municipal Trial Courts
(MTCs); Municipal Circuit Trial Courts (MCTCs) by
the Supreme Court in cadastral and land registration
cases if:
1. There is no controversy or opposition over the
land; or
2. Where the lot is contested but the value thereof
does not exceed P100,000.00 (B.P. 129, Sec.
34).
VENUE
GENERAL RULE: Regional Trial Court of the
province, city or municipality where the property is
situated.
NOTE: The decision of first-level courts shall be
appealable to the Court of Appeals (P.D. 1529, Sec.
33).
Registration Court Not divested of Jurisdiction
by Administrative Act for the Issuance of Patent
A land registration court which has validly acquired
jurisdiction over a parcel of land for registration of
title cannot be divested of said jurisdiction by a
subsequent administrative act consisting in the
issuance of a homestead patent covering the same
land (De los Angeles v. Santos, G.R. No. L-19615,
December 24, 1964).
Jurisdiction, as in ordinary actions, is acquired upon
the filing in court of the application for registration,
and is retained up to the end of the litigation
(AGCAOILI, Property Registration Decree (2018), p.
138).
Land Registration Courts Can Now Hear and
Decide Controversial and Contentious Cases
Such as Validity of a Tax Sale
The Supreme Court has declared that Presidential
Decree (P.D.) No. 1529, with the intention to avoid
multiplicity of suits and to promote expeditious
termination of cases, had eliminated the distinction
between the general jurisdiction vested in the
regional trial court and the latter's limited jurisdiction
when acting merely as a land registration court. Land
registration courts, as such, can now hear and
decide even controversial and contentious cases, as
well as those involving substantial issues. Certainly,
thus, the courts a quo had jurisdiction to rule on all
matters necessary for the determination of the issue
of ownership, including the validity of the tax sale
(Solco v. Megaworld Corp., G.R. No. 213669, March
5, 2018).
JURISDICTION IN CIVIL CASES INVOLVING
TITLE TO PROPERTY
RTCs shall exercise exclusive original jurisdiction in
all civil actions which involve the title to, or
possession of, real property or any interest therein:
1. Outside Metropolitan Manila, where the
assessed value of the property exceeds
P20,000; or
2. Within Metropolitan Manila, where the assessed
value of the property value exceeds P50,000
(B.P. Blg. 129, Sec. 19).
P.D. NO. 1529
(PROPERTY
REGISTRATION
DECREE)
OVERVIEW OF THE REQUISITES (13
STEPS) IN ORDINARY LAND
REGISTRATION PROCEEDINGS (P.D.
1529): (SAD-TP-SAH-PIEST)
1. Survey of the land by the Bureau of Lands (now
Land Management Bureau) or a duly licensed
private surveyor drawn on a tracing cloth plan;
2. Filing of Application for registration by the
applicant at the RTC of the province, city or
municipality where the property is situated;
3. Setting of Date for initial hearing by the court
which shall not be earlier than 45 days nor later
than 90 days from the date of the order;
4. Transmittal of application and date of initial
hearing together with all documents or other
evidence attached thereto by the Clerk of Court
to the Land Registration Authority;
5. Publication of the notice of filing of application
and the date and place of hearing once in the
Official Gazette and once in a newspaper of
general circulation in the Philippines;
6. Service by mailing of notice upon contiguous
owners, occupants and those known to have
interest in the property and posting by the sheriff
of such notice in a conspicuous place on the
land and in the bulletin board of the municipal
building where the land is situated;
7. Filing of Answer or Opposition to the application
by any person whether named in the notice or
not;
8. Hearing of the case by the court;
9. Promulgation of judgment by the court;
10. Issuance of decree or order by the court
declaring the decision final and instructing the
Land Registration Authority to issue a Decree of
Confirmation and Registration;
11. Entry of decree in the Land Registration
Authority;
12. Sending of copy of the Decree to the
corresponding Register of Deeds; and
13. Transcription of the Decree in the registration
book and issuance of the owner’s duplicate
Original Certificate of Title of the applicant by the
Register of Deeds upon payment of the
prescribed fees.
NOTE: Failure to comply with the foregoing will
justify the court to deny the application for
registration (AGCAOILI, Property Registration
Decree (2018), p. 132).
1. SURVEY
Survey of the land by the Bureau of Lands or a
duly licensed private surveyor drawn on a
tracing cloth plan;
Section 17 shows that it is mandatory for the
applicant for original registration to submit to the
trial court not only the original or duplicate copies
of the muniments of title but also the copy of the
duly approved survey plan of the land sought to
be registered. The survey plan is crucial
because it provides reference of the property’s
exact identity and location (AGCAOILI, Property
Registration Decree (2018), p. 138).
No plan or survey, whether it be original or
subdivision, may be admitted in land registration
proceedings until approved by the Director of
Lands (ADMINISTRATIVE CODE, Sec. 1858).
Recognizing the overlapping of functions, P.D.
239, dated July 9, 1973, was implemented
stating that the LRA was no longer authorized to
approve original survey plans for original
registration. Thus the Land Management
Bureau (LMB) is now authorized to verify and
approve original survey plans (MOGELLO,
Guidelines and Procedures in Land Titles and
Deeds (2019), p. 22).
This again is the recognition of the concept of
jura regalia where all lands and all other natural
resources are owned by the State, and a
recognition as well of the exclusive authority of
the Director of Lands in the administration,
management, survey, and disposition of lands of
the public domain (AGCAOILI, Property
Registration Decree (2018), p. 139).
2. FILING OF APPLICATION
Filing of application for registration by the
applicant at the RTC of the province, city, or
municipality where the property is situated. (P.D.
1529, Sec. 17).
The applicant shall file together with the
application all original muniments of titles or
copies thereof and a survey plan approved by
the Bureau of Lands (P.D. 1529, Sec. 17;
University of the Philippines v. Rosario, G.R. No.
136965, March 28, 2001).
Muniments of Title
Instruments or written evidence that the
applicant holds or possesses to enable him to
substantiate and prove the title to his estate.
Form of Application: (WS2)
a. In Writing;
b. Signed by the applicant or person duly
authorized; and
c. Sworn to before authorized officer in the
province or city where the application was
actually signed
NOTE: If there is more than one (1) applicant,
they shall be signed and sworn to, by and on
behalf of each (P.D. 1529, Sec. 15).
Pursuant to the Manual of Instructions to be
Observed by the Clerks of Courts of the Regional
Trial Courts in Ordinary and Cadastral Land
Registration Cases issued by the Land
Registration Authority on February 20, 1991, the
Application for Registration shall be filed in the
Following Form:
a) That the application shall be in accordance
with the form prescribed in Section 15 of PD.
No. 1528 and should state the full name of
the applicant, his civil status a, citizenship,
residence and postal address, and if a
minor, his age;
b) That the application be subscribed by the
applicant or the person duly authorized in
his behalf and to sworn to before any officer
authorized to administer oaths for the
province or city where the application was
actually signed;
c) That the application and its accompanying
papers be filed in triplicate which shall be
 distributed as follows: the original for the
Clerk of Court, the duplicate for the LRA,
and the triplicate for the Solicitor General;
and
d) That prior to the filing of the application, the
applicant has furnished the director of Lands
(now the Regional Executive Director of the
DENR), with a copy of application and its
annexes (P.D. No. 1529, Sec. 17).
Contents: (DC-NAM2-CNOB)
a. Full Description of the land as evidenced by
duly approved survey plan;
b. Citizenship and civil status of the applicant
whether single or married, and, if married,
the name of the wife or husband, and, if the
marriage has been legally dissolved, when
and how the marriage relation terminated;
c. Full Names and addresses of all occupants
of the land and those of the adjoining
owners if known, and, if not known, it shall
state the extent of the search made to find
them;
d. Assessed value of the land and the
buildings and improvements thereon;
e. Whether or not there are Mortgages or
encumbrances of any kind affecting the
land;
f. The Manner by which applicant has
acquired the land in accordance with Sec.
14, P.D. 1529;
g. Whether or not the property is Conjugal,
paraphernal or exclusive property of the
applicant;
h. Names of all occupants of the land;
i. Original muniments of title; and
j. If the land is Bounded by a public or private
way or road, there should be stated in this
paragraph whether or not the applicant
claims any and what land within the limits of
the way or road and whether the applicant
desires to have the line of the way or road
determined (P.D. 1529, Sec. 15)
(AGCAOILI, supra at 133)
Accompanying Documents:
a. Original plan in tracing cloth or diazo
polyester film, duly approved by the
Regional Technical Director, Land
Management Service of the DENR, a
certified copy of which shall be attached to
the duplicate records and forwarded to the
LRA (LRA Circular 05-2000);
b. White or blue print copies of the plan;
c. The original and two copies of the technical
descriptions certified by the Regional
Technical Director or any authorized official
and not merely signed by the geodetic
engineer who prepared the plan;
d. The original and two copies of the Geodetic
Engineer’s certificate or, in lieu thereof, a
certification from the Regional Technical
Director as to its non-availability;
e. A certificate in triplicate of the provincial, city
or municipal assessor of the assessed value
of the land at its last assessment for taxation
or in the absence hereof, that of the next
preceding year; and
f. All original muniments of title of the applicant
proving his ownership of the land. This
requirement is not mandatory as long as the
documents can be produced before the
court during hearing whenever required
when necessary (AGCAOILI, supra at 135).
NOTE: Under LRA Circular 05-2000, the original
tracing cloth plan is no longer forwarded to the
LRA; only a certified copy thereof needs to be
forwarded. The original tracing cloth plan is now
simply attached to the original record and
retained by the court where it may then be
marked and formally offered in evidence during
proceeding (AGCAOILI, supra at 135-136).
Fees Payable Upon Filing of Application
Fees are payable to the clerk of court or his
deputies upon filing an application for
registration of land, on the basis of its assessed
value for the current year (P.D. 1529, Sec. 111).
If the property has not been assessed for
taxation, the fees payable shall be based on the
current market value. In this case, the applicant
shall file with his application a sworn declaration
of three (3) disinterested persons fixing such
market value (P.D. 1529, Sec. 111).
NOTE: Application is endorsed to the MTC if
there is no controversy or opposition over the
land or where the lot is contested but the value
thereof does not exceed P100,000.00 (B.P. Blg.
129, Sec. 34).
Where Land is Situated Between Boundaries
of Two Provinces
If land is situated between boundaries of two
provinces, application must be filed:
a. Boundaries are Not Defined – In the RTC
of the place where it is declared for taxation
purposes;
b. Boundaries are Defined – A separate plan
for each portion must be made by surveyor
and a separate application for each lot must
be filed with appropriate RTC. (NOBLEJAS,
supra at 123-124).
Applicants in Ordinary Land Registration
Proceedings:
The following may file an Application for
Registration of Title to Land (OPAO):
a. Those who, by themselves or through
their predecessors-in-interest, have
been in Open, Continuous, Exclusive
and Notorious (OCEN) possession and
occupation of alienable and disposable
lands of the public domain under a bona
fide claim of ownership since June 12,
1945, or earlier;
b. Those who have acquired ownership of
private lands by Prescription under the
provisions of existing laws;
c. Those who have acquired ownership of
private lands or abandoned river beds
by right of Accession or accretion; and
d. Those who have acquired ownership of
land in any Other manner provided for
by law (P.D. 1529, Sec. 14).
Land Owned in Common: All co-owners shall
file the application for land registration jointly
where the land is owned in common (P.D. 1529,
Sec. 14, par. 3).
Land Sold under pacto de retro
GENERAL RULE: Vendor a retro may file the
application for land registration, provided that
he secures the written consent of the purchaser.
If the latter refuses to give it, he must set forth in
the application the sale with right to repurchase,
in order that the same may likewise be recorded
in the decree of registration (PEÑA, supra at 59).
EXCEPTION: When the period for redemption
expires during the pendency of the registration
proceedings and ownership to the property is
consolidated in the vendee a retro, the latter
shall be substituted for the applicant and
continue the proceedings (P.D. 1529, Sec. 14,
Par. 3).
Where the land has been sold under pacto de
retro, the vendor a retro may file an application
for the original registration of the land, provided,
however, that should the period for redemption
expire during the pendency of the registration
proceedings and ownership to the property
consolidated in the vendee a retro, the latter
shall be substituted for the application and may
continue the proceedings (Orchard Realty and
Development Corp. v. Republic, G.R. No.
136280, August 30, 2001).
Land Subject of a Trust Agreement: Trustee
on behalf of the beneficiary may apply for
registration, unless prohibited by the instrument
creating the trust (P.D. 1529, Sec. 14, Par. 4).
Land Applied for Registration by a Non-
Resident of the Philippines:
He shall file with his application:
a. An instrument in due form;
b. Appointing a duly authorized representative
or attorney-in-fact, whose authority shall
accompany the application;
c. Giving his full name and postal address; and
d. Shall therein agree that the service of any
legal process in the proceedings under or
growing out of the application made upon
his agent or representative shall be of the
same legal effect as if made upon the
applicant within the Philippines (P.D. 1529,
Sec. 16).
NOTE: If the agent or representative dies, or
leaves the Philippines, the applicant shall
forthwith make another appointment for the
substitute, and, if he fails to do so the court may
dismiss the application (P.D. 1529, Sec. 16).
Lands Applied for by Minors or Persons
under Disability: Application should be done
through their judicial guardian (NOBLEJAS,
supra at 89).
Lands Applied for by Married Woman
without Including the Name of Husband: It is
allowed only when the property relationship
between husband and wife is complete
separation of property or when the property is a
paraphernal property (Id. at 92; CIVIL CODE,
Art. 214).
Land Registration Application Covering Two
or More Parcels: An application may include
two or more parcels of land belonging to the
applicant/s provided they are situated within the
same province or city. The court may at any time
order an application to be amended by striking
out one or more of the parcels or by a severance
of the application (P.D. 1529, Sec. 18).
Who are Disqualified to Apply: (PAMP)
a. A Public land sales applicant insofar as the
land covered by his sales application is
concerned (Palawan Agricultural and
Industrial Co., Inc. v. Director of Lands, G.R.
No. L-25914, March 21, 1972).
REASON: He acknowledged that he is not
the owner of the land and that the same is
public land (Palawan Agricultural and
Industrial Co., Inc. v. Director of Lands, G.R.
No. L-25914, March 21, 1972).
b. An Antichretic creditor cannot also acquire
by prescription the land surrendered to him
 by the debtor (Ramirez v. CA, G.R. No.
117247, April 12, 1996).
REASON: His possession is not in the
concept of an owner (Ramirez v. CA, G.R.
No. 117247, April 12, 1996).
c. A Mortgagee or his successor-in-interest to
the mortgage, notwithstanding the lapse of
the period for the mortgagor to pay the loan
secured to redeem it (Reyes v. Sierra, G.R.
No. L-28658, October 18, 1979).
REASON: Such act would amount to a
pactum commissorium, which is against
good morals and public policy (Reyes v.
Sierra, G.R. No. L-28658, October 18,
1979).
d. A person or entity whose claim of
ownership to land had been Previously
denied in a reinvindicatory action (Kidpalos
v. Baguio Mining Co., G.R. No. L- 19940,
August 14, 1965).
Amendments
Refers to the changes made in the allegations or
contents in the application (P.D. 1529, Sec. 19).
Kinds of Amendments in the application
a. Formal Amendments
Refers to changes in the allegations
concerning the applicants or the parties-in-
interest.
Kinds (JSD):
i. Joinder – Inclusion of additional
applicants; amended by adding names
of new applicants;
ii. Substitution – Replacement of the
original party by another; and
iii. Discontinuance – Removal of names
of one or more applicants.
Amendments to the application, including
joinder, substitution, or discontinuance as to
parties may be allowed by the court at any
stage of the proceedings upon just and
equitable terms. In such cases, publication
is not necessary (P.D. 1529, Sec. 19, par.
1).
b. Substantial Amendments: (SIA)
i. Substantial change in the boundaries;
ii. Increase in the area of the land; and
iii. Inclusion of Additional land (P.D. 1529,
Sec. 19, par. 2).
Amendments which shall consist in substantial
change in the boundaries, or an increase in the
area of the land applied for, or which involve the
inclusion of an additional land shall be subject to
the same requirements of publication and notice
as in an original application (P.D. 1529, Sec. 19,
Par. 2).
NOTE: In case of substantial amendments,
publication and notice as in an original
application under Section 23 of P.D. 1529 are
required.
The purpose of the new publication is to give
notice to all persons concerned regarding the
amended application. Without a new
publication, the registration court cannot
acquire jurisdiction over the area covered by
the original application, and the decision of the
registration court would be a nullity insofar as the
decision concerns the newly included land. But
if the amendment consists in the exclusion of a
portion of the area covered by the original
application and the original plan as
previously established, a new publication is
not necessary (Benin v. Tuason, G.R. No. L-
26127, June 28, 1974).
An amendment due to change of name of the
applicant does not require republication
(Director of Lands v. IAC, G.R. No. 73246,
March 2, 1993).
In case of an amendment of application
involving two or more parcels of land, the court
may at any time order an application to be
amended by striking out one or more of the
parcels or by a severance of the application
(P.D. No. 1529, Sec. 18).
In case of reduction of the original area, no new
publication is required (AGCAOILI, supra at
142).
3. ISSUANCE BY THE COURT OF
ORDER SETTING THE DATE OF
INITIAL HEARING
Setting of date for initial hearing by the court,
publication, etc.
The court shall, within five (5) days from filing of
the application, issue an order setting the date
and hour of the initial hearing which shall not be
earlier than forty-five (45) days nor later than
ninety (90) days from the date of the order (P.D.
1529, Sec. 23).
The public shall be given notice of initial hearing
by means of publication, mailing and posting.
The requirement of giving notice by all three (3)
modes is mandatory.

NOTE: If the date of initial hearing was set
beyond the 90-day period, the Court will still
acquire jurisdiction. No fault is attributable to
such party if the trial court errs on matters within
its sole power. It is unfair to punish an applicant
for an act or omission over which the applicant
has neither responsibility nor control, especially
if the applicant has complied with all the
requirements of the law (Republic v. San
Lorenzo Dev’t, G.R. No. 170724, January 29,
2007).
4. TRANSMITTAL
Transmittal of application and date of initial
hearing together with all documents or other
evidence attached thereto by the Clerk of Court
to the Land Registration Authority (AGCAOILI,
supra at 132).
5. PUBLICATION
Upon receipt of the order of the court setting the
time for initial hearing, the Commissioner of
Land Registration shall cause notice of initial
hearing to be published once in the Official
Gazette and once in a newspaper of general
circulation in the Philippines (P.D. 1529, Sec.
23).
The law used the term “shall” in prescribing the
work to be done by the Commissioner of Land in
setting the time for initial hearing to be published
once in the Official Gazette and once in a
newspaper of general circulation in the
Philippines (Director of Lands v. CA, G.R. No.
102858, July 28, 1997).
Even as this Court concedes that the
aforequoted Section 23(1) of the Property
Registration Decree expressly provides that
publication in the Official Gazette shall be
sufficient to confer jurisdiction upon the land
registration court, it still affirms its declaration
in Director of Lands v. Court of Appeals that
publication in a newspaper of general circulation
is mandatory for the land registration court to
validly confirm and register the title of the
applicant or applicants.
That Section 23 of the Property Registration
Decree enumerated and described in detail the
requirements of publication, mailing, and posting
of the Notice of Initial Hearing, then all such
requirements, including publication of the Notice
in a newspaper of general circulation, is
essential and imperative, and must be strictly
complied with.
It may be asked why publication in a newspaper
of general circulation should be deemed
mandatory when the law already requires notice
by publication in the Official Gazette as well as
by mailing and posting, all of which have already
been complied with in the case at hand. The
reason is due process and the reality that the
Official Gazette is not as widely read and
circulated as newspaper and is oftentimes
delayed in its circulation, such that the notices
published therein may not reach the interested
parties on time, if at all. Additionally, such parties
may not be owners of neighboring properties,
and may in fact not own any other real estate. In
sum, the all-encompassing in rem nature of land
registration cases, the consequences of default
orders issued against the whole world and the
objective of disseminating the notice in as wide
a manner as possible demand a mandatory
construction of the requirements for publication,
mailing and posting (Republic v. Herbierto, G.R.
No. 156117, May 26, 2005).
NOTE: If the publication is made after the date
of the initial hearing, the entire proceeding will
be null and void because publication must
precede the hearing. This is because the court
was not able to acquire jurisdiction over the
property (Republic v. CA, G.R. No. 100995,
September 14, 1994).
Purpose and Effects:
a. To confer jurisdiction over the land applied
for the upon the court; and
b. To charge the whole world of knowledge of
the application of the land involved, and
invite them to take part in the case and
assent and prove their rights over the
property subject thereof (AGCAOILI, supra
at 150).
6. SERVICE OF NOTICE
Service of notice upon adjoining owners,
occupants and those known to have interest in
the property by the sheriff (Id. at 182).
Modes of giving the public notice of Initial
Hearing: (Mandatory)
a. Publication;
b. Mailing; or
c. Posting (P.D. 1529, Sec. 23).
Said notice shall be addressed to all persons
appearing to have an interest in the land
involved including:
a. Adjoining owners so far as know; and
b. To all whom it may concern or those who
have interest in the property.
 Mailing
Within 7 days after the publication of the said
notice, mailing of notice to:
a. Every person named in the notice whose
address is known;
b. If the applicant requests to have the line of a
public way or road determined: Secretary of
Public Highways, Provincial-Governor and
the Mayor of the municipality or city, as the
case may be, in which the land lies.
c. If the land borders on a river, navigable
stream or shore, or an arm of the sea where
a river or harbor line has been established,
or on a lake, or if it otherwise appears from
the application or the proceedings that a
tenant-farmer or the national government
may have a claim adverse to that of the
applicant: Secretary of Agrarian Reform,
Solicitor General, Directors of Land [now
Director of Land Management Bureau],
Director of Public Works, Director of Forest
Development, Director of Mines, and
Director of Fisheries and Aquatic Resources
(P.D. No. 1529, Sec. 23, par. 2).
Posting
A duly attested copy of the notice of initial
hearing to be posted by the sheriff of the
province or city, as the case may be, or by his
deputy, in a conspicuous place on each parcel
of land included in the application, and also in a
conspicuous place on the bulletin board of the
municipal building of the municipality or city in
which the land or portion thereof is situated, at
least fourteen (14) days before the date of initial
hearing (P.D. No. 1529, Sec. 23, par. 3).
The court may also cause notice to be served to
such other persons and in such manner as it
may deem proper.
7. ANSWER
Filing of answer or opposition to the application
by any person whether named in the notice or
not (AGCAOILI, supra at 132).
Who May File
Any person claiming an interest, whether named
in the notice or not, may appear and file an
opposition on or before the date of initial
hearing, or within such further time as may be
allowed by the court (P.D. 1529, Sec. 25).
Requisites for Oppositions:
a. Set forth objections to the application;
b. State the interest claimed by the opposition;
and
NOTE: Interest may be in the character of:
i. Legal owner;
ii. Equitable owner; or
iii. Beneficiary of trust
c. Apply for the remedy desired; and
d. Signed and sworn to by him or by some
other duly authorized person (P.D. No.
1529, Sec. 25).
Order of Default
If no person appears and answers within the
time allowed, the court shall, upon motion of the
applicant, no reason to the contrary appearing,
order a general default to be recorded and
require the applicant to present evidence. By the
description in the notice "To all Whom It May
Concern", all the world is made parties
defendant and shall be concluded by the default
order (P.D. 1529, Section 26, Par. 1).
Where an appearance has been entered and an
answer filed, a special default order shall be
entered against persons who did not appear and
answer (P.D. 1529, Section 26, Par. 2).
Kinds of Default
a. Order of General Default – Covers the
whole world and covers persons who did not
appear and file an answer (AGCAOILI,
supra at 171).
b. Order of Special Default – Covers persons
who appeared and asked for an extension
of time to file answer or opposition yet they
were not able to file opposition within the
given extension of time (Id. at 171).
Effects of Default:
a. With respect to the Applicant – He has the
right to present or adduce evidence ex parte
(NOBLEJAS, supra at 153).
b. With respect to those covered by the Default
Order – They have no legal standing in the
court. Therefore, they are no longer allowed
to participate and no opportunity to present
evidence (Id at 153).
Remedies Available to Person/s Covered by
Default:
a. If Before Judgment – Motion, under oath to
set aside the default order
Grounds: (FAME)
i. Fraud;
ii. Accident;
iii. Mistake; or
iv. Excusable Negligence.
In addition to the abovementioned grounds,
the person must also interpose that he has
a meritorious defense (Martinez v. Republic,
 G.R. No. 160895, October 30, 2006);
(RULES OF CIVIL PROCEDURE, Rule 9,
Sec. 3(b)).
b. If After Judgment but Before it is Final
and Executory
i. Motion for new trial (RULES OF
COURT, Rule 37)
Grounds: FAME or Newly Discovered
Evidence
Must be filed within fifteen (15) days
after order of default is received
ii. Motion for Reconsideration (RULES OF
COURT, Rule 37)
Grounds: Damages awarded are
excessive; Insufficiency of Evidence;
Decision or Final Order is contrary to
law
iii. Appeal to the Court of Appeals
a. Ordinary Appeal (RULES OF
COURT, Rule 41 [2a])
b. Petition for Review (RULES OF
COURT, Rule 42)
iv. Appeal by Certiorari to the Supreme
Court (RULES OF COURT, Rule 45)
In all cases where only questions of law
are raised or invoked.
Failure to file a motion for new trial,
reconsideration or appeal within the
reglementary period will render the
judgment final and executory.
c. If judgment becomes final and executory
– Petition for relief from judgment under
Rule 38 of the Rules of Court.
Ground: FAME
Must be filed within sixty (60) days from
knowledge of judgment but not beyond six
(6) months from entry of judgment.
A party declared in default retains the right to appeal
on the ground that the plaintiff failed to prove the
material allegations of the complaint, or that the
decision is contrary to law, even without the need of
prior filing of a motion to set aside the order of default
(Martinez v. Republic, G.R. No. 160895, October 30,
2006).
8. HEARING
Hearing of the case by the court;
Reception of evidence is governed by provisions
of P.D. 1529 and the Rules of Court, insofar as
it is not inconsistent with the provisions of P.D.
1529. It shall be applicable to land registration
and cadastral cases by analogy or in a
suppletory character and whenever practicable
and convenient (P.D. 1529, Sec. 34).
Reference to a Referee
The trial court shall see to it that all registration
proceedings are disposed within ninety (90)
days from the date the case is submitted for
decision.
The Court, if it deems necessary, may refer the
case or any part thereof to a referee (clerk of
court) who shall hear the parties and their
evidence.
The referee shall submit his report thereon to the
Court within fifteen (15) days after the
termination of such hearing.
Hearing before a referee may be held at any
convenient place within the province or city as
may be fixed by him and after reasonable notice
thereof shall have been served the parties
concerned (P.D. 1529, Sec. 27).
The Court’s possible actions as regards the
referee’s report: (MARS)
a. Modify the report;
b. Accept the same and use it as basis for
judgment;
c. Recommit the case to the referee for further
proceedings; and
d. Set aside the report in whole or part (P.D.
1529, Sec. 27).
Matters to be established: (I-PILA)
a. Issue of ownership;
b. Possession and occupation of the land;
c. Identity and description of the land;
d. Land is alienable and disposable of the
public domain; and
e. Applicant has acquired the land through any
other modes of acquiring ownership
(Heirs of Mario Malabanan v. Republic, G.R.
No. 179987, Nov. 10, 2014).
NOTE: Judgment refers to adjudication,
determination and resolution of the question of
ownership.
Partial Judgment
In a land registration proceeding where only a
portion of the land subject of registration is
contested, the court may render partial judgment
provided that a subdivision plan showing the
contested and uncontested portions approved
by the Director of Lands is previously submitted
to said court (P.D. 1529, Sec. 28).
 Judgment Confirming Title
All conflicting claims of ownership and interest in
the land subject of the application shall be
determined by the court. If the court, after
considering the evidence and the reports of the
Commissioner of Land Registration and the
Director of Lands, finds that the applicant or the
oppositor has sufficient title proper for
registration, judgment shall be rendered
confirming the title of the applicant, or the
oppositor, to the land or portions thereof (P.D.
1529, Sec. 29).
The judgment rendered in a land registration
proceedings becomes final upon the expiration
of thirty (30) days to be counted from the data of
receipt of notice of the judgment. An appeal may
be taken from the judgment of the court as in
ordinary civil cases (P.D. 1529, Sec. 30).
Kinds of Dismissal of the Proceedings
a. With prejudice (provided that judgment is
already final and executory)
i. Principle of res judicata applies. The
party can no longer re-file the case.
b. Without prejudice
i. The party may re-file the case.
Illustration: When dismissal is due to lack
of evidence presented by the applicant
(NOBLEJAS, supra at 78).
Remedies:
a. When order of dismissal is not yet final and
executory – Motion for reconsideration to be
filed fifteen (15) days from receipt of
judgment (RULES OF COURT, Rule 37).
b. When order of dismissal is final and
executory – File a new application for
registration (RULES OF COURT, Rule 37).
9. DECREE OF CONFIRMATION AND
REGISTRATION
Issuance of decree or order by the court
declaring the decision final and executory and
ordering the Land Registration Authority (LRA)
to issue a Decree of Confirmation and
Registration.
It is not the court but the LRA who issues the
decree of confirmation and registration. This
duty to issue the decree of registration does
not prescribe (Republic v. Nillas, G.R. No.
159595, Jan. 23, 2007).
One (1) year after the issuance of the decree, it
becomes incontrovertible and amendments of
the same will not be allowed, except merely in
case of clerical errors (P.D. 1529, Sec. 32).
10. ENTRY OF DECREE
Entry of decree in the Land Registration
Authority; This serves as the reckoning date to
determine the 1-year period from which one can
impugn the validity of the registration (P.D.
1529, Sec. 32).
Contents of the Decree of Registration
a. Date, hour and minutes of the entry of the
decree;
b. Signature of administrator;
c. Civil status of the owner and if married, the
name of the husband or wife; if conjugal
property, the decree shall be issued in the
name of both spouses;
d. If the owner is under disability, his nature of
disability;
e. If the owner is a minor, his age;
f. Description of the land;
g. Estate of the owner;
h. Relative priorities;
i. Particular estates;
j. Mortgagees;
k. Easements;
l. Liens;
m. Attachments;
n. Other encumbrances; and
o. Rights of the tenant-farmer; and
p. As well as any other matters properly to be
determined in pursuance of this Decree.
(P.D. 1529, Sec. 31)
NOTE: The decree of registration shall bind the
land and quiet title thereto, subject only to such
exceptions or liens as may be provided by law.
It shall be conclusive upon and against all
persons, including the National Government and
all branches thereof, whether mentioned by
name in the application or notice, the same
being included in the general description “To All
Whom It May Concern” (P.D. 1529, Sec. 31).
GENERAL RULE: Registered owner receiving
a certificate of title in pursuance of a decree of
registration, and every subsequent purchaser of
registered land taking a certificate of title for
value and in good faith, shall hold the same free
from all encumbrances (P.D. 1529, Sec. 44).
Limitations: Statutory Liens
a. Liens, claims or rights arising or existing
under the laws and Constitution of the
Philippines which are not by law required to
appear of record in the Registry of Deeds in
order to be valid against subsequent
purchasers or encumbrancers of record;
b. Unpaid real estate taxes levied and
assessed within two (2) years immediately
preceding the acquisition of any right over
 the land by an innocent purchaser for value, Deeds upon payment of the prescribed
without prejudice to the right of the fees (P.D 1529, Sec. 39).
government to collect taxes payable before
that period from the delinquent taxpayer NOTE: In Judicial Confirmation of Imperfect
alone; or Incomplete title, the above mentioned steps
c. Any public highway or private way must also be complied with (C.A. 141 as
established or recognized by law, or any amended, Sec. 48(b)).
government irrigation or lateral thereof, if the
certificate of title does not state that the
boundaries of such highway or irrigation
canal or lateral thereof have been C.A. 141, SECTION 41
determined; and
d. Any disposition of the property or limitation (JUDICIAL
on the use thereof by virtue of, or pursuant
to, P.D. No. 27 or any other law or
CONFIRMATION OF
regulations on agrarian reform (P.D. 1529, IMPERFECT OR
Sec. 44).
INCOMPLETE TITLE)
Remedies of Parties Adversely Affected by
Judgment in the Registration Proceedings:
a. Motion for New trial on the grounds of
FAME; Motion for Reconsideration (RULES DISTINCTION BETWEEN P.D. 1529
OF COURT, Rule 37); AND C.A. NO. 141
b. Appeal to the CA or SC pursuant to Section PROPERTY
33 PD 1529; PUBLIC LAND ACT
REGISTRATION
c. Petition for Relief from judgment (RULES (C.A. NO. 141)
DECREE (P.D. 1529)
OF COURT, Rule 38) on the grounds of
FAME, filed sixty (60) days from receipt of Property Registration Public Land Act
notice of judgment, but not more than six (6) Decree presupposes presupposes that the
months; the existence of a title land subject of the
d. Action for Reconveyance, filed within ten which is to be confirmed application belongs to
(10) years but not available against innocent by the court the State, and that the
purchaser for value; occupants and
e. Action for damages against applicant or any possessors claim
persons who perpetrated fraud; interest only in the
f. Claim against the Assurance Fund; same by virtue of their
g. Cancellation of Title or Annulment of imperfect title or
Judgment (RULES OF COURT, Rule 47) continuous, open,
(e.g. foreshore land, published only in the notorious possession.
Official Gazette);
h. Petition to Reopen or Review the Decree of The court may dismiss The court has the power
Registration (P.D. 1529, Sec. 32), filed the application with or and jurisdiction to
within a year from entry of Decree of without prejudice adjudicate the land in
Registration on the ground of actual fraud; favor of any of the
and conflicting claimants
i. Criminal Action for Perjury against the party
who obtains registration through fraud The applicant runs the The applicant runs the
(People v. Cainglet, G.R. Nos. L-21493-94, risk of the possibility of risk of losing the land
April 29, 1966); and the denial of his subject of the
j. Action for Reversion (Sec 101, Ca No. 141). application application

While the goal at which the two laws finally arrive

11. SENDING AND TRANSCRIPTION OF
THE DECREE
a. Sending of copy of the Decree to the
corresponding Register of Deeds; and
b. Transcription of the Decree in the
registration book and issuance of the
owner’s duplicate Original Certificate of
Title of the applicant by the Register of
is the same, namely, a Torrens title, which aims at
complete extinguishment once and for all of rights
adverse to the record title, one law containing
certain advantages not found in the other law, and
similarly certain disadvantages, the two (2) laws
provide different routes to travel to attain the
ultimate goal.
(AGCAOILI, supra at 542-543) (MOGELLO, supra at
237)
WHO MAY APPLY:
1. Filipino citizens who by themselves or through
their predecessors-in-interest have been in
open, continuous, exclusive and notorious
possession and occupation of alienable and
disposable lands of public domain under a bona
fide claim of acquisition since June 12, 1945 or
prior thereto or since time immemorial (C.A. 141,
Sec. 48, as amended by P.D.1073, Sec. 4);
2. Filipino citizens who by themselves or their
predecessors-in-interest have been, prior to the
effectivity of P.D. 1073 on January 25, 1977, in
open, continuous, exclusive, and notorious
possession and occupation of agricultural lands
of the public domain, under a bona fide claim of
acquisition of ownership, for at least thirty (30)
years, or at least since January 24, 1947 (R.A.
1942, Sec. 1; People v. CA, G.R. No. 116372,
January 18, 2001);
3. Natural-born citizens of the Philippines who
have lost their citizenship and who has the
legal capacity to enter into a contract under
Philippine laws may be a transferee of private
land up to a maximum area of 5,000m2, in case
of urban land or three (3) hectares in case of
rural land to be used by him for business or other
purposes (R.A. 8179, Sec. 5);
4. Natural-born citizens of the Philippines who
have lost their Philippine citizenship, who
have acquired disposable and alienable lands of
the public domain from Filipino citizens who had
possessed the same in the same manner and
for the length of time indicated in paragraphs 1
and 2 (CONST., ART XII, Sec. 8);
When the conditions set by law are complied
with, the possessor of the land, by operation of
law, acquires a right to a grant, a government
grant, without the necessity of a certificate of title
being issued (Republic v. Doldol, G.R. No.
132963, September 10, 1998); and
5. Private domestic corporations or
associations which had acquired lands from
Filipino citizens who had possessed the same in
the manner and for the length of time indicated
in paragraphs 1 and 2 above.
Possession of Lands of the Public Domain Must
be From June 12, 1945 or Earlier
The law, as presently phrased, requires that
possession of lands of the public domain must be
from June 12, 1945 or earlier, for the same to be
acquired through judicial confirmation of imperfect
title (Republic v. Doldol, G.R. No. 132963,
September 10, 1998).
Applicant Must Prove That:
1. The land is alienable and disposable land of
public domain; and
2. They have been in open, continuous, exclusive,
and notorious possession and occupation of the
land for the length of time and in the manner and
concept provided by law (Director of Lands v.
Buyco, G.R. No. 91189, November 27, 1992).
Extended Period for Application
R.A. 9176, Section 1 provides in part that “The time
to be fixed in the entire archipelago for the filing of
applications under this chapter shall not extend
beyond December 31, 2020, provided that the area
applied for does not exceed twelve (12) hectares.”
FILING OF APPLICATION
Extent of Jurisdiction
GENERAL RULE: Application shall be filed with the
RTC of the province or city where the land is situated
(P.D. 1529, Sec. 17).
EXCEPTION: Delegated jurisdiction of the MTC to
hear and determine cadastral or land registration
cases covering lots where there is no controversy or
opposition, or contested lots, the value of which does
not exceed P100,000.00 (B.P. 129, Sec. 34, as
amended by R.A. 7691).
NOTE: The Regional Trial Courts have the authority
to act not only on original applications but also those
filed after original registration, with power to hear
and determine all questions arising upon such
applications or petitions (Averia v. Caguioa, G.R. No.
L-6512, December 29, 1986; Ignacio v. CA, G.R. No.
98920, July 14, 1995).
A person who seeks the registration of title to a piece
of land on the basis of possession by himself and his
predecessors-in-interest must prove his claim by
clear and convincing evidence, that is, he must
prove his title and should not rely on the absence or
weakness of evidence of the oppositors (Republic v.
Rayos, G.R. No. 211698, May 30, 2016).
Contents of the Application; Annexes:
1. Name of applicant, citizenship, civil status, name
of spouse, and if marriage has been legally
dissolved, the manner of its termination;
2. Description of the land;
3. Verification;
4. Application covering two or more parcels of land
belonging to the applicants provided they are
situated in the same province or city;
5. Annexes;
a. Survey plan of the land (P.D. 1529, Sec. 17);
b. Technical descriptions (P.D. 1529, Sec. 15);
 c. Certificate of the Geodetic Engineer; and
d. Certificate regarding the last assessment for
taxation of the property.
6. Amendments to the application including
joinder, substitution, or discontinuance of parties
may be allowed by the court at any stage of the
proceedings upon just and reasonable terms
(P.D. 1529, Sec. 19);
7. Additional requirements the court demands and
not inconsistent with law (P.D. 1529, Sec. 21);
and
8. Occupants and adjoining owners (P.D. 1529,
Sec. 15).
NOTE: Application shall state the full names and
addresses of all occupants of the land and those of
the adjoining owners if known and if not known, it
shall state the extent of the search made to find them
(P.D. 1529, Sec. 15).
Section 15 of P.D. 1529 is explicit in requiring that in
the application for registration of land titles, the
application "shall also state the full names and
addresses of all occupants of the land and those of
the adjoining owners if known, and if not known, it
shall state the extent of the search made to find
them." As early as Francisco vs. Court of Appeals,
97 SCRA 22 [1980] we emphasized that a mere
statement of the lack of knowledge of the names of
the occupants and adjoining owners is not sufficient
but "what search has been made to find them is
necessary (Francisco v. Rojas, G.R. No. 167120,
April 23, 2014).
Publication, Mailing and Posting
The court shall, within five (5) days from filing of the
application, issue an order setting the date and hour
of the initial hearing which shall not be earlier than
forty-five (45) days nor later than ninety (90) days
from the date of the order (P.D. 1529, Sec. 23).
REASON: To confer jurisdiction upon the court and
to invite all parties concerned to appear in court to
show cause why the prayer of said application shall
not be granted (P.D 1529, Sec. 23).
THE PUBLIC SHALL BE GIVEN NOTICE
OF THE INITIAL HEARING OF THE
APPLICATION FOR LAND
REGISTRATION BY: (PMP)
1. Publication of notice of initial hearing
Frequency of Publication
It shall be published once in the Official Gazette
and once in the newspaper of general circulation
(P.D. 1529, Sec. 23).
Publication on Issue of Jurisdiction
Compliance is mandatory and jurisdictional
(Republic v. Marasigan, G.R. No. 85515, June
6, 1991).
SEC. 9. x x x Thereupon, the court shall cause
a notice of the petition to be published, at the
expense of the petitioner, twice in successive
issues of the Official Gazette, and to be posted
on the main entrance of the provincial building
and of the municipal building of the municipality
or city in which the land lies, at least thirty days
prior to the date of hearing, and after hearing,
shall determine the petition and render such
judgment as justice and equity may require. The
foregoing provisions, therefore, clearly require
that (a) notice of the petition should be published
in two (2) successive issues of the Official
Gazette; and (b) publication should be made at
least thirty (30) days prior to the date of hearing.
Substantial compliance with this jurisdictional
requirement is not enough; it bears stressing
that the acquisition of jurisdiction over a
reconstitution case is hinged on a strict
compliance with the requirements of the law
(Republic v. de Asis, G.R. No. 193874, July 24,
2013).
In case there is a discrepancy between the
publication in the Official Gazette and the notice
of initial hearing, it affects the jurisdiction of the
court over land registration (Heirs of Regalado v.
Republic, G.R. No. 168155, February 15, 2007).
Publication shall precede the date of hearing.
Late publication of the notice defeats the
purpose for its existence thereby reducing it to a
pro-forma notice (Republic v. CA, G.R. No.
100995, September 14, 1994).
A land registration proceeding is one in rem and
notice thereof by publication binds the whole
world, inclusive of those who may be adversely
affected thereby, innocent factually as they
might have been of such publication. Such a rule
could be the only way to give meaning to the
finality and indisputability of the Torrens title to
be issued (Francisco v. CA, G.R. No. L-35787,
April 11, 1980).
Partial Nullity
If it is later shown that the decree of registration
had included land or lands not included in the
original application as published, then the
registration proceedings and the decree of
registration must be declared null and void – but
only insofar as the land not included in the
publication is concerned. This is because the
court did not acquire jurisdiction over the land
not included in the publication- the publication
 being the basis of the jurisdiction of the court
(Benin v. Tuason, G.R. No. L-26127, June 28,
1974).
Republication
If the amendment consists in the inclusion in the
application for registration of an area or parcel of
land not previously included in the original
application, as published, a new publication of
the amended application must be made. If the
amendment of the survey plan during the
registration proceedings does not involve an
addition, but on the contrary, a reduction of the
original area that was published, no new
publication is required (Republic v. CA, G.R.
Nos. L-43105, August 31, 1984).
Technical corrections which do not appear to be
substantial do not need republication (Francisco
v. CA, G.R. No. 130768, March 21, 2002).
2. Mailing of the notice of hearing
Administrator of Land Registration Authority
shall cause a copy of the notice of initial hearing
of the application to be mailed to the following:
a. Every person named in the notice whose
address is known – Within seven (7) days
after the publication of notice in the Official
Gazette;
b. Secretary of DPWH, Provincial Governor,
and Mayor of the municipality or city, as the
case may be, in which the land lies, if
applicant requests to have the line of a
public way or road determined;
c. Secretary of DAR, Solicitor General,
Director of Land Management, Director of
Mines and/or Director of Fisheries and
Aquatic Resources, as the case may be, if
the land borders on a river, navigable
stream or shore, or on an arm of the sea
where a river or harbor line has been
established, or on a lake, or if it otherwise
appears from the application that a tenant-
farmer or the national government may have
a claim adverse to the applicant; and
d. Other persons the court may deem proper
(P.D. 1529, Sec. 23).
3. Posting
Posting of the copy of the notice of hearing is a
duty of the sheriff which must be made at least
fourteen (14) days, or 2 weeks before the date
of initial hearing, in conspicuous places
(AGCAOILI, supra at 160).
Certification of the Administrator of LRA and of
the sheriff concerned to the effect that the notice
of initial hearing, as required by law, has been
complied with shall be filed in the case before
the date of initial hearing, and shall be
conclusive proof of such fact (P.D. 1529, Sec.
24).
Service of notice upon contiguous owners is
indispensable and lack of service thereof
constitutes “extrinsic fraud.” (Adviento v. Heirs of
Miguel Alvarez, G.R. No. 150844, Aug. 20,
2008).
ANSWER OR OPPOSITION
Oppositor to an application need not be named in the
notice of initial hearing.
Requirements of the answer or opposition:
1. It must be in writing and sworn to by the
applicant or a representative in his behalf;
2. It must set forth the objection;
3. It must state the interest of the opposing party;
and
4. It must state the remedy desired. (ALBANO,
Civil Law Reviewer, supra at 815).
Adverse claimants must set forth in their answer
all their objections to the application and must
claim an interest to the property applied for,
based on a right of dominion or some other real
right independent of, and not at all subordinate,
to the rights of the government (City of Baguio v.
Marcos, G.R. No. L-26100, Feb. 28, 1969).
Oppositor does not have to show title in himself;
he should however appear to have an interest in
the property. The opposition partakes of the
nature of an answer with a counterclaim (Valisno
v. Plan, G.R. No. L-55152, August 19, 1986).
The burden of proving that the property is an
alienable and disposable agricultural land of the
public domain falls on the applicant, not the
State. However, when the State has no effective
opposition, except for a pro forma opposition, to
controvert an applicant's convincing evidence of
possession and occupation, presumptions are
tilted to this applicant's favor. Hence, when a
land has been in the possession of the
applicants and their predecessor-in-interest
since time immemorial and there is no manifest
indication that it is unregistrable, it is upon the
State to demonstrate that the land is not
alienable and disposable (Republic v. Spouses
Noval, G.R. No. 170316, September 18, 2017).
The Following may be Proper Oppositors:
(FrAGH)
1. A purchaser of Friar land before the issuance of
the patent to him;
2. Persons who claim to be in possession of a tract
of public land and have Applied with the Bureau
of Lands for its purchase;
3. The Government relative to the right of
foreshore lessees of public land as the latter’s
rights are not based on dominion or real right
independent of the right of the government (De
Castro v. Marcos, G.R. No. L-26093, Jan. 27,
1969); and
4. A Homesteader who has not yet been issued
his title but who had fulfilled all the conditions
required by law to entitle him to a patent (Leyra
v. Jandoc, G.R. No. L-16965, February 28,
1962).
The opposition must state all the objections to
the application and set forth the interest claimed
by the oppositor, and duly sworn to by him or his
duly authorized representative.
The Rules of Court could be applied in land
registration proceedings in a suppletory
character or whenever practicable or convenient
(P.D. 1529, Sec. 24).
Motion to intervene in a land registration case is
not allowed. Secs. 14 and 15 of P.D. 1529 show
that the applicant and the oppositors are the only
parties in cases of original applications for land
registration, unlike in ordinary civil actions where
parties may include the plaintiff, defendant, third
party complainants, cross claimants and
intervenors (Dolfo v. Register of Deeds for the
Province of Cavite, G.R. No. 133465,
September 25, 2000).
No Estoppel on the Part of the Government
The government cannot be estopped from
questioning the validity of the certificates of title
which were granted without opposition from the
government. The principle of estoppel does not
operate against the government for the acts of its
agents (Palomo v. CA, G.R. No. 95608, January 21,
1997).
DEFAULT
Effect: If no person appears and answers within the
time allowed, the court shall, upon motion of the
applicant, no reason to the contrary appearing, order
a default to be recorded and require the applicant to
present evidence. By the description in the notice
"To All Whom It May Concern", all the world is made
parties - defendant and shall be concluded by the
default order. Where an appearance has been
entered and an answer filed, a default order shall be
entered against persons who did not appear and
answer (P.D. 1529, Sec. 25).
Remedy: A defaulted interested person may file as
a remedy motion to set aside the order of default in
accordance with Section 3(b) of Rule 9 of the Rules
of Court. (Cerezo v. Tuazon, G.R. No. 141538,
March 23, 2004).
Additional Relief: The application of the Lina
Doctrine as applied in the case of Martinez v.
Republic (G.R. No. 160895, October 30, 2006)
states as follows:
1. The defendant in default may, at any time after
discovery thereof and before judgment, file a
motion, under oath, to set aside the order of
default on the ground that his failure to answer
was due to (FAME) Fraud, Accident, Mistake or
Excusable neglect, and that he has meritorious
defenses (RULES OF COURT, RULE 18, Sec.
3);
2. If the judgment has already been rendered when
the defendant discovered the default, but before
the same has become final and executory, he
may file a motion for new trial (RULES OF
COURT, RULE 37, Sec. par. 1 (a));
3. If the defendant discovered the default after the
judgment has become final and executory, he
may file a petition for relief from judgment
(RULES OF COURT, RULE 38, Sec. 2); and
4. He may also appeal from the judgment rendered
against him as contrary to the evidence or to the
law, even if no petition to set aside the order of
default has been presented by him (RULES OF
COURT, RULE 41, Sec. 2).
EVIDENCE
The applicant must prove: (DIP)
1. That the land applied for has been Declassified
and is a public agricultural land, is alienable and
disposable, or otherwise capable of registration
(AGCAOILI, supra at 236).
NOTE: Specific evidence:
a. Presidential proclamation;
b. Executive Order;
c. Administrative Order issued by the
Secretary of DENR;
d. Bureau of Forest Development Land
Classification Map;
e. Certification by the Director of Forestry;
f. Investigation reports of the Bureau of Lands
investigator; and
g. Legislative act or by a statute (Id. at 247).
2. The Identity of the land
NOTE: Proof of identity of land
a. Survey plan in general;
b. Tracing cloth plan and blueprint copies of
plan;
The submission of original tracing cloth plan
of the land approved by the Director of
Lands is a statutory requirement of
mandatory character which cannot be
waived either expressly or impliedly
(Director of Lands v. Heirs of Isabel
 Tesalona, G.R. No. 66130, September 8,
1994).
The Court has pointed out that although the
best means to identify a piece of land for
registration purposes is the original tracing
cloth plan approved by the Bureau of Lands
(now the Lands Management Services of
the Department of Environment and Natural
Resources), other evidence could provide
sufficient identification (Republic v. Alba,
G.R. No. 169710, August 19, 2015).
c. Technical description of the land;
d. Tax declarations (AGCAOILI, supra at 267);
and
e. Boundaries and area (Id. at 266).
3. Possession and occupation of the land for the
length of time and in the manner required by law
(Ong v. Republic, G.R. No. 175746, March 12,
2008).
EFFECT OF POSSESSION
GENERAL RULE: Open, exclusive, and undisputed
possession of alienable public land for the period
prescribed by law creates the legal fiction whereby
the land, upon completion of the requisite period ipso
jure and without need of judicial or other sanctions,
ceases to be public land and becomes private
property (Director of Lands v. Manila Electric
Company, G.R. No. L-57461, September 11, 1987).
The present possessor may complete the period
necessary for prescription by tacking his possession
to that of his grantor or predecessor-in-interest
(CIVIL CODE, Art. 1138, par. 1).
Tacking of possession is allowed only when there is
privity of contract or relationship between the
previous and present possessors (South City
Homes, Inc. v. Republic, G.R. No. 76564. May 25,
1990).
PROOF OF PRIVATE OWNERSHIP:
(STOP)
1. Spanish title, in pending cases;
Spanish titles are now inadmissible and
ineffective as proof of ownership in land
registration proceedings filed after August 16,
1976. All lands granted under the Spanish
mortgage law system of registration, which are
not yet covered by a certificate of title issued
under the Torrens system, are deemed as
unregistered land (P.D. 1529, Sec. 3).
With the passage of P.D. 892, effective February
16, 1976, Spanish titles can no longer be used
as evidence of land ownership (Republic v. CA,
G.R. No. L-56077, February 28, 1985).
It is merely an indicia of a claim of ownership
(Camara v. Malabao, G.R. No. 154650, July 31,
2003) or that the holder has a claim of title over
the property (Municipality of Antipolo v. Zapanta,
G.R. No. L-65334, December 26, 1984).
2. Tax declarations and Tax payments;
While tax declarations and real estate tax
receipts are not conclusive evidence of
ownership, if presented as documentary
evidence coupled with proof of actual
possession for the period required by law of the
land, they are good evidence of ownership
(Heirs of Maningding v. CA, G.R. No. 121157,
July 31, 1997; Republic v. Metro Cebu Pacific
Savings Bank, G.R. No. 205665, October 4,
2017). Moreover, even if belatedly declared for
taxation purposes, it does not negate
possession especially if there is no other
claimant of the land (Republic v. CA and
Divinaflor, G.R. No. 116372, January 18, 2001).
Where the taxes for 31 years, 1946 to 1976,
were paid only in 1976, a few months prior to
filing of the application, such payment does not
constitute sufficient proof that applicant has a
bona fide claim of ownership during those years
prior to the filing of the application (Republic v.
CA, G.R. No. L-61462, July 31, 1984).
Mere failure of the owner of the land to pay the
realty tax thereon does not warrant a conclusion
that there was abandonment of his right to the
property (Reyes v. Sierra. G.R. No. L-28658,
October 18, 1979).
3. Other kinds of proof; or
Testimonial evidence (i.e., accretion is on a land
adjacent to a river). Any evidence that accretion
was formed through human intervention negates
the claim (Binalay v. Manalo, G.R. No. 9216,
March 18, 1981).
4. Presidential issuances and legislative
acts constitutive of a “fee simple” title or
absolute title in favor of the grantee
(Republic v. CA, G.R. No. L-40912, September
30, 1976).
INSUFFICIENT PROOF OF OWNERSHIP:
(FiT²-COP)
1. Mere failure of Fiscal representing the State to
cross-examine the applicant on the claimed
possession (Republic v. Lee, G.R. No. 64818,
May 13, 1991).

2. Tax declaration of land sought to be registered,
which is not in the name of the applicant but in
the name of the deceased parents of an
oppositor (Sunga v. De Guzman, G.R. No. L-
25847, June 19, 1979);
REASON: Possession of applicant is not
completely adverse or open, nor is it truly in the
concept of an owner (Sunga v. De Guzman,
G.R. No. L-25847, June 19, 1979).
3. Holding of property by mere Tolerance of the
owner (CIVIL CODE, Art. 537)
REASON: The holder is not in the concept of an
owner, and does not perform possessory acts,
notwithstanding the length of the start of the
running of the period of prescription. Where
applicants tack their possession to that of their
predecessor-in-interest, but they did not present
him as witness or when no proof of what acts of
ownership and cultivation were performed by the
predecessor, the holder likewise cannot be an
owner (Director of Lands v. Datu, G.R. No. L-
57573, July 5, 1982).
4. Mere Casual cultivation of portions of the land
by claimant (Republic v. Vera, G.R. No. L-
35778, January 27, 1983; Director of Lands v.
Reyes, G.R. No. 102858, July 28, 1997;
Republic v. Science Park of the Philippines, Inc.,
G.R. No. 237714, November 12, 2018).
REASON: Possession is not exclusive and
notorious so as to give rise to a presumptive
grant from the State (Republic v. Vera, G.R. No.
L-35778, January 27, 1983.).
5. Possession of Other persons in the land applied
for impugns the exclusive quality of the
applicant’s possession (Director of Lands v. CA,
G.R. No. 50340, December 26, 1984).
6. Even if the petitioners can trace their deed of
sale back to Adam and Eve, fill in every square
inch of the land with agricultural tenants, have
residential houses built every few meters here
and there, pay the realty taxes religiously every
year and have an approved Bureau of Lands
Survey yearly, they will not become the owners
if they will not follow the Procedure to obtain
public agricultural land mandated by the Public
Land Act (C.A. No. 141) (Manalastas v. CA, G.R.
No. 97493, February 8, 1993).
PROOF INSUFFICIENT TO ESTABLISH
PRIVATE RIGHT OR OWNERSHIP:
1. A compromise agreement among parties to a
land registration case where they have rights
and interest over the land and allocated portions
thereof to each of them;
NOTE: Assent of the Director of Lands and the
Director of Forest Management to a compromise
agreement did not and could not supply the
absence of evidence of title required of the
applicant (Republic v. Sayo, G.R. No. 61565,
August 20, 1990).
2. A decision in an estate proceeding of a
predecessor-in-interest of an applicant which
involves a property over which the decedent has
no transmissible right, and in other cases where
issue of ownership was not definitely passed
upon (Director of Lands v. IAC, G.R. No. 70825,
March 11, 1991);
3. A survey plan of an inalienable land.
NOTE: Such plan does not convert such land
into an alienable land, much less a private
property (Republic v. CA, G.R. No. L-56948,
September 30, 1987).
CADASTRAL
PROCEEDINGS
Nature: An involuntary proceeding in rem, initiated
by the filing of petition for registration by the
government to adjudicate titles for all the land within
a stated area, whether or not the people living within
desire to have titles issued. Here, all claimants are
compelled to litigate against one another regarding
their respective claims of ownership (AGCAOILI,
supra at 353).
NOTE: The government initiates a cadastral case,
compelling all claimants in the municipality to litigate
against one another regarding their respective
claims of ownership (Id. at 353)
INVOLUNTARY PROCEEDING
Involuntary on the part of the claimants but they are
compelled to substantiate their claim or interest
through an answer.
Purpose:
1. To serve the public interest by requiring that the
titles to any unregistered lands be settled and
adjudicated (P.D. 1529, Sec. 35(a));
2. To settle all disputes over the land; and
3. To remove all clouds over land titles, as far as
practicable, in a community (AGCAOILI, supra
at 353).
Period of Filing
Extended up to December 31, 2020, as provided in
R.A. 9176, Sec. 2 (2002).
Limitation to Area Applied For
Maximum of twelve (12) hectares, as provided in
R.A. 6940, Sec. 3 (1990).
PROCEDURE: (PreNo2S-P2AHDI)
1. Determination by the President that public
interest requires title to unregistered lands be
settled and adjudicated; (P.D. 1529, Sec. 35
(a));
2. Notice of cadastral survey by the Director of
Lands to persons claiming interest in the lands
and to the general public; published once in the
Official Gazette and posted in a conspicuous
place on the bulletin board of the municipal
building of the municipality in which the lands or
any portion thereof is situated; with copies
furnished to the municipal mayor and barangay
captain, Sangguniang Panlalawigan and
Sangguniang Bayan (P.D. 1529, Sec. 35 (b));
3. Notice in advance of date of survey by Geodetic
Engineers or other employees of the Bureau of
Land Management and posting in bulletin board
of the municipal building of the municipality or
barrio, and shall mark the boundaries of the
lands by monuments set up in proper places
thereon (P.D. 1529, Sec. 35 (c));
4. Cadastral Survey (P.D. 1529, Sec. 35);
NOTE: Only unregistered lands may be the
subject of a cadastral survey (AGCAOILI, supra
at 358).
5. Filing of Petition (P.D. 1529, Sec. 36);
When the lands have been surveyed or plotted,
the Director of Lands, represented by the
Solicitor General, shall institute original
registration proceedings before the Regional
Trial Court of the place where the land is
situated. (P.D. 1529, Sec. 36).
6. Publication, mailing, and posting;
Publication of notice of initial hearing to be
published twice in successive issues of the
Official Gazette, in English language (Act No.
2259, Sec. 7);
7. Filing of Answer (P.D. 1529, Sec. 37);
The answer shall also contain:
1. Age of the claimant
2. Cadastral number of the lot or lots
claimed
3. Name of the barrio and municipality in
which the lots are situated
4. Names and addresses of the owners of
the adjoining lots so far as known to the
claimants
5. If the claimant is in possession of the
lots claimed, the length of time he has
held such possession and threat of his
predecessors and the manner in which
it has been acquired;
6. If the claimant is not in possession or
occupation of the land, the interest
claimed by him and the time and
manner of his acquisition;
7. The last assessed value of the lots/lots
8. The encumbrances, if any, affecting the
lots and the names of adverse
claimants, as far as known (AGCAOILI,
id at 356).
8. Hearing of the case (P.D. 1529, Sec. 38);
9. Decision (P.D. 1529, Sec. 38); and
10. Issuance of Decree and Certificate of Title (P.D.
1529, Sec. 38).
NOTE: In the absence of fraud, title to land in a
cadastral proceeding is vested on the owner upon
the expiration of the period to appeal from the
decision or adjudication by the cadastral court,
without such appeal being perfected; and from that
time the land becomes registered property which
cannot be lost by adverse possession (AGCAOILI,
supra at 357).
The rule is different in case of public land. Under
Section 103 of the Property Registration Decree, the
property is not considered registered until the final
act or the entry in the registration book of the
Registry of Deeds has been accomplished.
A decision in a cadastral proceeding declaring land
as public land does not preclude the claimant from
subsequently seeking a judicial confirmation of his
title to the same land under Sec. 48, C.A. 141
(Director of Lands v. Court of Appeals and Pastor,
G.R. No. L-47847, July 31, 1981).
Neither prescription nor laches may render
inefficacious a decision in a land registration case
(Republic v. Nillas, G.R. No. 159595, January 23,
2007). The failure on the part of the administrative
authorities to do their part in the issuance of the
decree of registration cannot oust the prevailing
party from ownership of the land (De Luzuriaga, Jr.
v. Republic, G.r. No. 169019, June 30, 2009)
In Rodriguez vs Toreno and Abes vs Rodil, the
cadastral court declared lands as private property
and the final judgment rendered therein was held to
be res judicata. In Republic vs Vera, it was ruled that
while the land was declared public land by the ORDINARY REGISTRATION
cadastral court, respondents who apparently either PROCEEDING V.
did not file their answers or failed to substantiate
their claims were now precluded from re-litigating the CADASTRAL PROCEEDING
same issues already determined by final judgment ORDINARY
CADASTRAL
(AGCAOILI, supra at 367). REGISTRATION
PROCEEDING
PROCEEDING
JURISDICTION AND POWERS OF THE
CADASTRAL COURT IN CADASTRAL As to Nature of Registration
PROCEEDINGS: Voluntary. Compulsory.
1. Adjudicate title to any claimant entitled thereto;
2. Declare land as a public land; As to Applicant
3. Order the correction of the technical description;
4. Order the issuance of new title in place of the Landowner. The Government
title issued under voluntary registration (Director of Lands
proceedings; through the Solicitor
5. Determine the priority of overlapping title; and General).
6. Order the partition of the property (NOBLEJAS,
supra at 478-479). As to Lands Covered

Usually involves private All classes of lands are

ACTIONS TAKEN BY THE CADASTRAL land; it may also refer to included.
COURT AT THE TRIAL: public agricultural lands
1. Judgment or decision, which adjudicates if the object of the action
ownership of the land involved in favor of one or is confirmation of an
more claimants, or if there are no successful imperfect title.
claimants, declare such as a public land. This is
the decree of the court; As to Parties
2. Declaration by the court that the decree is final
and its order for the issuance of the Certificate Applicant and oppositor Landowners must
of Title by the LRA; and come to court as
3. Issuance of the decrees of registration pursuant claimants of their own
to final judgments of the court, registration of lands.
decree by the LRA and issuance of the
corresponding Certificate of Title (AGCAOILI, As to Purpose
supra at 357-358).
Petitioner comes to Government asks the
court to confirm his title court to settle and
NOTE: The Cadastral court is not limited to merely
and seeks the adjudicate the title of
adjudication of ownership in favor of one or more
registration of the land in the land.
claimants. If there are no successful claimants, the
his name.
property is declared public land. Additionally, while
the court has no jurisdiction to adjudicate lands As to Survey
already covered by a Certificate of Title, it is
nonetheless true that this rule only applies where Survey applied for is It is the Government
there exists no serious controversy as to the done at the instance and that undertakes the
certificate’s authenticity vis-à-vis the land covered for the account of the survey and advances
therein (Republic v. Vera, G.R. No. L-35778, applicant who is a the expenses incident
January 27, 1983; Widows and Orphans Ass’n., Inc. private person. thereto.
v. CA, G.R. No. 91797, August 28, 1991).
As to Effect of Judgment
Cadastral courts have no jurisdiction over a petition
for reconstitution. Where respondent heirs were in No adverse claim; if the If none of the
possession of the lots in question, unlawfully and applicant fails to prove applicants can prove
adversely, during the cadastral proceedings, they his title, his application that he is entitled to the
may be judicially evicted by means of a writ of may be dismissed land, the same shall be
possession, the issuance of which never prescribes without prejudice (no res declared public (res
(AGCAOILI, supra at 368). judicata). judicata).
(NOBLEJAS, supra at 77).

R.A. 8371
(INDIGENOUS PEOPLES
RIGHTS ACT OF 1997)
INDIGENOUS PEOPLES RIGHTS ACT
(IPRA) OF 1997 (R.A. 8731)
Allows indigenous people to register their ancestral
lands under Judicial Confirmation of Imperfect Title
or under Voluntary Land Registration Proceedings.
The IPRA categorically declares ancestral lands and
domains held by native title as never to have been
public land. Domains and lands held under native
title are, therefore, indisputably presumed to have
never been public lands and are private (Cruz v.
Sec. of Environmental and Natural Resources, G.R.
No. 135385, December 6, 2000, J. Puno’s Opinion).
Ancestral lands remain as such even if possession
is interrupted by voluntary dealing (AGCAOILI,
supra at 115).
NATIVE TITLE
Refers to pre-conquest rights to lands and domains
which, as far back as memory reaches, have been
held under a claim of private ownership by ICCs/IPs,
have never been public lands and are thus
indisputably presumed to have been held that way
since before the Spanish Conquest (IPRA, Sec. 3,
par. l).
CONSTITUTIONAL BASIS OF THE IPRA
The State, subject to the provisions of the
Constitution and national development policies and
programs, shall protect the rights of indigenous
cultural communities to their ancestral lands to
ensure their economic, social and cultural well-
being.
The Congress may provide for the applicability of
customary laws governing property rights or
relations, in determining the ownership and extent of
ancestral domain (CONSTI., Art XII, Sec. 5).
The Supreme Court upheld the constitutionality of
the IPRA, as it grants to ICCs/IPs a distinct kind of
ownership over ancestral domains and ancestral
lands. It was to address the centuries-old neglect of
the Philippine indigenous peoples that the Tenth
Congress of the Philippines passed and approved
R.A. 8371 (Cruz v. Secretary of DENR, G.R. No.
135385, December 6, 2000).
INDIGENOUS CULTURAL
COMMUNITIES/INDIGENOUS PEOPLES
(ICCS/IPS)
1. Group of people or homogenous societies
identified by self-ascription and ascription by
another, who
a. Have continuously lived as organized
community on communally bounded and
defined territory; and
b. Have, under claims of ownership since time
immemorial, occupied, possessed customs,
tradition and other distinctive cultural traits;
or
c. Have, through resistance to political, social
and cultural inroads of colonization, non-
indigenous religions and culture, became
historically differentiated from the majority of
Filipinos (IPRA, Sec. 3, par. h).
2. People who are regarded as indigenous on
account of their descent from the populations
which inhabited the country, at the time of
conquest or colonization, or at the time of
inroads of non-indigenous religions and
cultures, or the establishment of present state
boundaries, who retain some or all of their own
social, economic, cultural and political
institutions, but who may have been displaced
from their traditional domains or who may have
resettled outside their ancestral domains (IPRA,
Sec. 3, par. h).
ANCESTRAL DOMAINS
It refers to all areas generally belonging to ICCs/IPs
comprising lands, inland waters, coastal areas and
natural resources therein which are:
1. Held under a claim of ownership, occupied or
possessed by ICCs/IPs, by themselves or
through their ancestors, communally or
individually;
2. Since time immemorial, continuously to the
present except when interrupted by war, force
majeure or displacement by force, deceit or
stealth, or as a consequence of government
projects or any other voluntary dealings entered
into by the government and private
individuals/corporations; and
3. Which are necessary to ensure their economic,
social, and cultural welfare (IPRA, Sec. 3, par.
a).
It also includes lands which may no longer be
exclusively occupied by the ICCs/IPs but from which
they traditionally had access to for their subsistence
and traditional activities (IPRA, Sec. 3, par. a).
ANCESTRAL LANDS
Refers to land occupied, possessed and utilized by
individuals, families and clans who are members of
the ICCs/IPs since time immemorial, by themselves The IPRA connotes groups or communal
or through their predecessors-in-interest, under ownership
claims of individual or traditional group ownership, By virtue of the communal character of ownership,
continuously, to the present except when interrupted the property held in common is meant to benefit the
by war, force majeure or displacement by force, whole indigenous community and not merely the
deceit, stealth, or as a consequence of government individual member. This concept maintains the view
projects and other voluntary dealings entered into by that said domains are the ICCs/IPs’ private but
government and private individuals/corporations, community property. Communal rights are held in
including, but not limited to, residential lots, rice trust for all generations of the ICCs/IPs, past present
terraces or paddies, private forests, swidden farms and future.
and tree lot (IPRA, Sec. 3, par. b).
The domain cannot be transferred, sold, conveyed
ANCESTRAL DOMAIN V. ANCESTRAL to other persons by one person and belongs to the
LAND ICCs/IPs as a community (AGCAOILI, supra at 121-
122).
ANCESTRAL ANCESTRAL LAND
DOMAIN NATURAL RESOURCES WITHIN
As to Scope/Inclusion ANCESTRAL DOMAINS
The IPRA recognizes the existence of the
Includes all areas Only includes lands indigenous cultural communities or indigenous
generally belonging to which are occupied, peoples as a distinct sector in Philippine Society.
ICCs/IPs comprising possessed and utilized The ownership given is the indigeneous concept of
lands, inland waters, by individuals, families ownership under customary law which traces its
coastal areas and and clans who are origin to native title (AGCAOILI, supra at 121).
natural resources members of the However, it does not necessarily mean that the
therein. ICCs/IPs since time natural resources found therein belong to the
immemorial. ICCs/IPS as private property. Ownership over the
natural resources belong to the State (AGCAOILI,
May be found within supra at 122).
ancestral domains
(IPRA, Sec. 53). The ICCs/IPS shall have priority rights in the
harvesting, extraction, development or exploitation
As to Evidence of Native Title of any natural resources within the ancestral
domains (IPRA, Sec. 57).
Certificate of Ancestral Certificate of Ancestral
Domain Title (CADT) Land Title (CALT) under The ICCs/IPs rights over the natural resources take
under IPRA— Rule II Rule II [c], Rules the form of management or stewardship. The law
[c], Rules Regulations Regulations only grants the ICCs/Ips “priority” rights in the
Implementing the Implementing the IPRA. development or exploitation thereof (AGCAOILI,
IPRA. . supra at 123).
As to Modes of Acquisition
A non-member of the ICCs/IPs concerned may be
By native title (IPRA). By native title; or allowed to take part in the development and
Registration under utilization of the natural resources for a period of
C.A.141/P.D. 1529. not exceeding twenty-five (25) years renewable
for not more than twenty-five (25) years provided
that a formal and written agreement is entered
TIME IMMEMORIAL into with the ICCs/IPs concerned (IPRA, Sec. 57).
Refers to a period of time when as far back as
memory can go, certain Indigenous Cultural DELINEATION AND RECOGNITION OF
Communities/Indigenous People are known to have ANCESTRAL DOMAIN
occupied, possessed in the concept of owner, and Under RA No. 8371, self-delineation is the guiding
utilized a defined territory devolved to them, by principle in the identification and delineation of
operation of customary law or inherited from their ancestral domains. The SWORN statement of the
ancestors, in accordance with their customs and elders as to the scope of their territories and
traditions (IPRA, Sec. 3, par. p). agreements/pacts made with neighboring ICCs/IPs,
if any, will be essential to the determination of these
traditional territories (AGCAOILI, supra at 123).
TWO MODES OF ACQUIRING TRANSFER OF LAND AND PROPERTY
ANCESTRAL DOMAINS AND RIGHTS
ANCESTRAL LANDS: These lands may be transferred subject to the
1. By Native Title, over both ancestral lands and following limitations:
domains; and a. Only to the members of the same ICCs/IPs
2. By Torrens title under the Public Land Act and b. In accord with customary laws and traditions and
Property Registration Decree, with respect to c. Subject to the right of redemption of the
ancestral lands only (IPRA, Sec. 12). ICCs/IPs for a period of 15 years if the land was
transferred to a non-member of the ICCs/IPs,
NOTE: The option granted under Sec. 12 of the under the terms of the law (AGCAOILI, supra at
IPRA was allowed to be exercised within 20 years 126).
from the effectivity of the Act, or from October 29,
1997.

REQUISITES FOR REGISTRATION OF SUBSEQUENT

ANCESTRAL LANDS REGISTRATION
1. Applicant must be a member of the Indigenous
ICCs/Ips P.D. 1529
2. Possession of ancestral land must not be less
than 30 years immediately preceding the
approval of IPRA on October 29, 1997
3. By operation of law, the land is already classified
as alienable and disposable even with a slope of
18% or more. Hence, no need to submit a
separate certification that the land has been
classified as alienable and disposable (IPRA,
Sec.12).

CERTIFICATE OF ANCESTRAL LAND

TITLE: (CALT)
Refers to a title formally recognizing the rights of the
ICCs and IPs over their ancestral lands (IPRA, Sec.
3, par. d).

The allocation of ancestral lands within any ancestral

domains to individual or indigenous corporate
claimants shall be left to the ICCs/IPs concerned to
decide in accordance with customs and traditions. If
the NCIP finds such claim meritorious, it shall issue
a CALT, declaring and certifying the claim of each
individual or corporate claimant over ancestral
lands. (IPRA, Sec. 53(g)).

CERTIFICATE OF ANCESTRAL DOMAIN

TITLE
Refers to a title formally recognizing the right of
possession and ownership of ICCs and IPs over
their ancestral domains identified and delineated in
accordance with the law (IPRA, Sec. 3, par. c).

EFFECT OF REGISTRATION
A duly issued Torrens title covering ancestral lands
has the same efficiency, validity and indefeasibility
as any title issued through regular registration
proceedings (AGCAOILI, supra at 125).
SUBSEQUENT REGISTRATION
Refers to any transaction affecting an originally
registered land and which, if in order, is registered in
the Office of the Register of Deeds concerned,
(PEÑA, supra at 12).
acquired a right to the same land, his knowledge of
that prior unregistered interest has the effect of
registration as to such party (AGCAOILI, supra at
430). Actual notice, however, is equivalent to
registration (AGCAOILI, supra at 431).

Where incidental matters after original registration The non-registration of the Deed of Absolute Sale
may be brought before the land registration court by with the Registry of does not affect the sale’s validity
way of a motion or petition filed by the registered and effectivity. As ruled in Sapto v. Fabiana,
owner or a party in interest (Id at 12). between the parties to a sale, registration is not
necessary to make it valid and effective, for actual
All transactions affecting an originally registered notice is equivalent to registration (Miranda v. Sps.
land, whether voluntary or involuntary, shall be Ernesto, G.R. No. 218343, November. 28, 2018).
registered with the proper Register of Deeds. (P.D
1529, Sec. 10).
KINDS OF TRANSACTIONS AFFECTING
RULES AS TO THE NECESSITY AND LANDS ORIGINALLY REGISTERED
EFFECTS OF REGISTRATION, IN 1. Voluntary Dealings
GENERAL: 2. Involuntary Dealings
1. Except a will that purports to convey or affect a
registered land, the mere execution of deeds of VOLUNTARY DEALINGS V.
sale, mortgages, leases or other voluntary INVOLUNTARY DEALINGS
documents serves only two (2) purposes: (1) as VOLUNTARY INVOLUNTARY
a contract between the parties thereto; and (2) DEALINGS DEALINGS
as evidence of authority to the RD to register
such documents (P.D. 1529, Sec. 51, par. 1). As to Concept
2. It is only the act of registering the instrument in
the Register of Deeds of the province or city Refer to deeds, Refer to such writ, order
where the land lies which is the operative act instruments or or process issued by a
that conveys ownership or affects the land documents which are court of record affecting
insofar as third persons are concerned (P.D. results of the free and registered land which
1529, Sec. 51, par. 2). voluntary acts of the by law should be
3. The act of registration creates a constructive parties thereto registered to be
notice to the whole world of such voluntary or (AQUINO, supra at effective, and also to
involuntary instrument or court writ or process 184). such instruments which
(P.D. 1529, Sec. 52). are not the willful acts of
the registered owner
Registration of a document is ministerial on the part and which may have
of the Register of Deeds. The Register of Deeds is been executed even
precluded from exercising his personal judgment without his knowledge
and discretion when confronted with the problem of or against his consent
whether to register a deed or instrument on the (AQUINO, supra at
ground that it is invalid. This function belongs to a 184).
court of competent jurisdiction (Almirol v. Register of
Deeds of Agusan, G.R. No. L-22486, March 20, As to Kinds
1968).
1. Sale; 1. Attachment;
A deed or other voluntary instrument involving 2. Real property 2. Mandamus;
registered land shall not take effect as a conveyance mortgage; 3. Sale on execution of
or bind the land but shall operate as a contract 3. Lease; judgment or sales for
between the parties and as evidence of the authority 4. Pacto de retro sale; taxes;
of the Register of Deeds to make registration. The 5. Extra-judicial 4. Adverse claims;
act of registration shall be the operative act to settlement; 5. Notice of lis
convey or affect the land insofar as third persons are 6. Free patent/ pendens;
concerned (Marasigan v. Intermediate Appellate homestead; 6. Expropriation;
Court, G.R No. L-69303, July 23, 1987). 7. Powers of attorney; 7. Forfeiture; and
and 8. Auction sale on
Thus, where the party has knowledge of a prior 8. Trusts. foreclosure of
existing interest which is unregistered at the time he mortgage.
 VOLUNTARY INVOLUNTARY REQUIREMENTS IN THE PROCESS OF
DEALINGS DEALINGS REGISTRATION IN VOLUNTARY
DEALINGS: (SPF3)
Effects of Registration
1. Compliance with the form prescribed
An innocent purchaser Entry thereof in the day under P.D. 1529, Sec. 112;
for value of registered book of the Register of Deeds, conveyances, encumbrances,
land becomes the Deeds is sufficient discharges, powers of attorney and other
registered owner the notice to all persons voluntary instruments shall be in a public
moment he presents even if the owner’s instrument executed in accordance with law, viz:
and files a duly duplicate certificate of (SANS)
notarized and valid title is not presented to
deed of sale and the the Register of Deeds. a. Signed by the parties in the presence of at
same is entered in the least 2 witnesses who shall likewise sign
day book and at the thereon;
same time he b. Acknowledged to be the free act and deed
surrenders or presents of the parties before a notary public or other
the owner’s duplicate officer authorized by law to take
certificate of title acknowledgment;
covering the land sold. c. Where the instrument has for its object 2 or
more parcels of land, the Number thereof
As to Presentment of Certificate of Title shall also be stated in the acknowledgment.
d. Each page of the copy of the instrument,
Need to present title to No presentation except the page where the Signatures
record the deed in required – annotation in already appear at the foot of the instrument,
registry and to make entry book is sufficient. shall be: (1) signed on the left margin thereof
memorandum on title. by the parties and their witnesses, and (2)
sealed with the notarial seal. This fact as
well as the number of the pages shall be
stated in the acknowledgment.
VOLUNTARY DEALINGS 2. Presentation of owner’s duplicate
certificate (P.D. 1529, Sec. 53);
The production of the owner's duplicate
An owner of a registered land may convey, certificate of title serves as conclusive authority
mortgage, lease, charge or otherwise deal with the from the registered owner to the Register of
same in accordance with existing laws. He may use Deeds to enter a new certificate or to make a
such forms of deeds, mortgages, leases or other memorandum of registration in accordance with
voluntary instruments as are sufficient in law (P.D. the voluntary instrument presented (AGCAOILI,
1529, Sec. 51). supra at 433).

The act of registration shall be the operative act to Where a voluntary instrument cannot be
convey or affect the land insofar as third persons are registered by reason of the refusal or failure of
concerned (P.D. 1529, Sec. 51). the holder to surrender the owner's duplicate
certificate of title, the party in interest may file a
PHYSICAL DELIVERY NOT A petition in court to compel surrender of the same
to the Register of Deeds (P.D. 1529, Sec.107).
REQUISITE FOR A VALID
CONVEYANCE Upon filing of the petition, the court, after
Delivery as a mode of transmission of ownership hearing, may either:
may be actual or constructive. When the sale of real a. Order the registered owner or any person
property is made in a public instrument, the withholding the duplicate certificate to
execution thereof is equivalent to the delivery of the surrender the same and direct the entry of a
thing, object of the contract, absent any showing in new certificate or memorandum upon such
the deed to the contrary. In this case, there is surrender; or
constructive delivery (Philippine Suburban b. If the registered owner or any person
Development. Corp. v. Auditor General, G.R. No. L- withholding the duplicate certificate refuses
19545, April 18, 1975). to surrender the same or if for any reason
the outstanding owner’s duplicate certificate
cannot be delivered, order the annulment of
 the same as well as the issuance of a new
certificate of title in lieu thereof (AGCAOILI,
supra at 434).
3. Full payment of required registration
fees and the requisite documentary
stamps;
4. Evidence of Full payment of real estate
tax as may be due; and
5. Inclusion of one extra copy of any
document of transfer or alienation of real
property, to be Furnished the city or
provincial assessor (PEÑA, supra at 247).
MIRROR DOCTRINE
All persons dealing with property covered by a
Torrens certificate of title are not required to go
beyond what appears on the face of the title. When
there is nothing on the Certificate of Title which
indicates the presence of any cloud or vice in the
ownership of the property, or any encumbrance
thereon, the purchaser is not required to explore
further than what the Torrens Title upon its face
indicates in quest for any hidden defect or inchoate
right that may subsequently defeat his right thereto
(Centeno v. CA, G.R. No. L-40105, November 11,
1985; Sigaya v. Mayuga, G.R. No. 143254, August
18, 2005; Calma v. Lachica, G.R.No.222031,
November 22, 2017).
NOTE: The sanctity of the Torrens System must be
preserved; otherwise, everyone dealing with the
property registered under the system will have to
inquire in every instance s to whether the title had
been regularly issued, contrary to the evident
purpose of the law (Heirs of Gavino v. CA, G.R. No.
120154, June 29, 1998).
EXCEPTIONS TO THE APPLICABILITY
OF THE MIRROR DOCTRINE:
(BF-BALIK)
1. Purchaser acted in Bad faith (Egao v. CA, G.R.
No. 79787, June 29, 1989);
2. When the purchaser or mortgagee is a
Financing institution e.g. GSIS (Dela Merced v.
GSIS, G.R. No. 140398, September 11, 2001);
3. Banks, as their business is one affected with
public interest (Omengan v. PNB, G.R. No.
161319, January 23, 2007);
4. Where a person buys land not from the
registered owner but from one whose right to the
land has been merely Annotated on the
Certificate of Title (Quiniano v. CA, G.R. No. L-
23024, May 31, 1971);
5. Purchaser of land where the certificate of title
contains a notice of Lis pendens;
6. Sufficiently strong Indications to impel closer
inquiry into the location, boundaries and
condition of the lot (Francisco v. CA, G.R. No. L-
30162, August 31, 1987); and
7. Purchaser with full Knowledge of flaws and
defects in the title (Bernales v. IAC, G.R. Nos.
71490-91, June 28, 1988; Lu v. Manipon, G.R.
No. 147072, May 7, 2002).
The presence of anything that excites or arouses
suspicion should then prompt the vendee to look
beyond the vendor’s certificate and investigate the
title appearing on the face of that certificate. A
vendee who does not do so cannot be denominated
either as an innocent purchaser for value or as a
purchaser in good faith and hence, does not merit
the protection of the law (Sps. Domingo v. Reed,
G.R. No. 157701. Dec. 9, 2005).
TIME OF EFFECTIVITY OF
REGISTRATION
The Register of Deeds shall, as a preliminary
process in registration, note in such book the date,
hour and minute of reception of all instruments, in
the order in which they were received. They shall be
regarded as registered from the time so noted, and
the memorandum of each instrument, when made
on the certificate of title to which it refers, shall bear
the same date (P.D. 1529, Sec. 56).
The rule is that where two certificates of title are
issued to different persons covering the same parcel
of land in whole or in part, the earlier in date must
prevail as between the original parties and, in case
of successive registration where more than one
certificate is issued over the land, the person holding
title under the prior certificate is entitled to the
property as against the person who relies on the
second certificate (National Housing Authority v.
Laurito, G.R. No. 191657, July 31, 2017).
The rule that where two certificates purport to
include the same land, the earlier in date prevails, is
valid only absent any anomaly or irregularity tainting
the registration (Beatingo v. Gasis, G.R No. 179641,
Feb. 9, 2011; Bangis v. Heirs of Adolfo, G.R. No.
190875, June 13, 2012).
DOUBLE SALE
Where the same registered owner sells the same
land to two different persons who are unaware of the
flaw that lies in its title, the ownership of the land
passes to the vendee who first recorded it in the
Register of Deeds (CIVIL CODE, Art. 1544, par. 2).
Should there be no inscription, the ownership shall
pertain to the first possessor in good faith and in the
absence thereof, to the one who, in good faith,
presents the oldest title (CIVIL CODE, Art. 1544, par.
3).
FORGED OR FRAUDULENT DEED MAY
BE THE ROOT OF A VALID TITLE
A fraudulent and forged document of sale may
become the root of a valid title if the certificate has
already been transferred from the name of the true
owner to the name indicated by the forger (Duran v.
Intermediate Appellate Court, G.R. No. L-64159,
September 10, 1985).
Requisites: (DTI)
1. The registered owner Delivered or entrusted the
owner’s duplicate certificate of title to the forger;
2. The certificate has already been Transferred
from the name of the true owner to the forger;
and
3. The vendee or mortgagee is an Innocent
purchaser for value (AGCAOILI, supra at 438).
The established rule is that a forged deed is
generally null and cannot convey title, the exception
thereto, pursuant to Section 55 of the Land
Registration Act, denotes the registration of titles
from the forger to the innocent purchaser for value.
Thus, the qualifying point here is that there must be
a complete chain of registered titles. This means that
all the transfers starting from the original rightful
owner to the innocent holder for value – and that
includes the transfer to the forger – must be duly
registered, and the title must be properly issued to
the transferee (Sps. Peralta v. Heirs of Abalon, G.R.
No. 183448, June 30, 2014).
The above rule cannot be applied where the owner
still holds a valid and existing certificate of title
covering the same property because the law
protects the lawful holder of a registered title over the
transfer of a vendor, bereft of any transmissible right
(Tomas v. Tomas, G.R. No. L-36897, June 26,
1980).
INNOCENT PURCHASER FOR VALUE
Where registration is procured by fraud, the owner
may pursue all his legal and equitable remedies
against the parties to such fraud without prejudice,
however, to the rights of any innocent holder for
value of a certificate of title (P.D. 1529, Sec. 53, par.
3).
An innocent purchaser for value is one who buys the
property of another without notice that some other
person has a right to or interest in that same
property, and who pays a full and fair price at the
time of the purchase and before receiving any notice
of another person’s claim (Sps. Villamil v. Villarosa,
G.R. No. 177187, April 7, 2009).
NOTE: The protection given to an innocent
purchaser for value extends to an innocent lessee,
mortgagee, or other encumbrancer for value (P.D.
1529, Sec. 32).
MEMORANDUM OF ENCUMBRANCES
It is not necessary to issue a new certificate on the
basis of an instrument which does not divest the
ownership or title from the owner or from the
transferee of the registered owner. A brief
memorandum of the nature of the instrument
entered into the certificate of title, signed by the
Register of Deeds, shall serve as notice to third
parties of the instruments affecting the property
(AGCAOILI, supra at 444).
All interests in registered land less than ownership
shall be entered in the memorandum of
encumbrances (P.D. 1529, Sec. 54).
CONVEYANCES AND TRANSFERS
Upon presentation by the owner who desires to
convey the land covered by his title of the proper
deed of conveyance and the owner's duplicate
certificate to the Register of Deeds, the latter shall:
1. Enter in the registration book the fact of
conveyance;
2. Prepare a new certificate of title in the name of
the grantee; and
3. Cancel the original and owner's duplicate
certificate of the grantor (P.D. 1529, Sec. 57).
IF A DEED OR CONVEYANCE IS FOR A
PART ONLY OF THE LAND DESCRIBED
IN A CERTIFICATE OF TITLE
The Register of Deeds shall not enter any transfer
certificate to the grantee until a plan of such land
showing all the portions or lots into which it has been
subdivided and the corresponding technical
descriptions shall have been verified and approved
pursuant to Section 50 of this Decree. Meanwhile,
such deed may only be annotated by way of
memorandum upon the grantor's certificate of title,
original and duplicate, said memorandum to serve
as a notice to third persons of the fact that certain
unsegregated portion of the land described therein
has been conveyed, and every certificate with such
memorandum shall be effectual for the purpose of
showing the grantee's title to the portion conveyed to
him, pending the actual issuance of the
corresponding certificate in his name.
Upon the approval of the plan and technical
descriptions, the original of the plan, together with a
certified copy of the technical descriptions shall be
filed with the Register of Deeds for annotation in the
corresponding certificate of title and thereupon said
officer shall issue a new certificate of title to the
grantee for the portion conveyed, and at the same
time cancel the grantor's certificate partially with
respect only to said portion conveyed, or, if the
grantor so desires, his certificate may be canceled
totally and a new one issued to him describing
therein the remaining portion: Provided, however,
that pending approval of said plan, no further
registration or annotation of any subsequent deed or
other voluntary instrument involving the
unsegregated portion conveyed shall be effected by
the Register of Deeds, except where such
unsegregated portion was purchased from the
Government or any of its instrumentalities (P.D.
1529, Sec. 58).
IF THE LAND HAS BEEN SUBDIVIDED
INTO SEVERAL LOTS, DESIGNATED BY
NUMBERS OR LETTERS
The Register of Deeds may, if desired by the grantor,
instead of canceling the latter's certificate and
issuing a new one to the same for the remaining
unconveyed lots, enter on said certificate and on its
owner's duplicate a memorandum of such deed of
conveyance and of the issuance of the transfer
certificate to the grantee for the lot or lots thus
conveyed, and that the grantor's certificate is
canceled as to such lot or lots (P.D. 1529, Sec. 58).
CARRYING OVER OF ENCUMBRANCES
In conveyances of registered land, all subsisting
encumbrances or annotations appearing in the
registration book shall be carried over and stated on
the new certificate of title, except where said
encumbrances or annotations are simultaneously
released or discharged (P.D. 1529, Sec. 59).
MORTGAGES AND LEASES
Mortgages and leases shall be registered by filing
with the Register of Deeds the instrument creating
the mortgage and by a brief memorandum thereof
made by the Register of Deeds (P.D. 1529, Sec. 60).
MIRROR DOCTRINE APPLIES TO THE
RIGHT OF A MORTGAGEE
GENERAL RULE: A mortgagee has a right to rely in
good faith on the certificate of title of the mortgagor
of the property offered as security, and in the
absence of any sign that might arouse suspicion, the
mortgagee has no obligation to undertake further
investigation (Arguelles v. Malarayat Rural Bank,
Inc., G.R No. 200468, March 19, 2014) (AGCAOILI,
supra at 444).
EXCEPTIONS:
1. Banking institutions
Banks are expected to exercise greater care and
prudence in their dealings, including those
involving registered lands. A banking institution
is expected to exercise due diligence before
entering into a mortgage contract (PNB v.
Juamanoy, G.R No. 169901, Aug. 3, 2011).
Where the mortgagee is a bank, it cannot rely
merely on the certificate of title offered by the
mortgagor in ascertaining the status of
mortgaged properties. Since its business is
impressed with public interest, the mortgagee-
bank is duty-bound to be more cautious even in
dealing with registered lands. Indeed, the rule
that a person dealing with registered lands can
rely solely on the certificate of title does not
apply to banks (Heirs of Paz Macalalad v. Rural
Bank of Pola, Inc., G.R. 200899, June 20, 2018).
The ascertainment of the status or condition of a
property offered to it as security for a loan must
be a standard and indispensable part of its
operations (Duque Rosario v. Banco Filipino
Savings and Mortgage Bank, G.R No. 140528,
December 7, 2011).
2. Mortgagee does not directly deal with the
unregistered owner of real property (Arguelles v.
Malarayat Rural Bank, Inc., G.R No. 200468,
March 19, 2014).
UNRECORDED SALE OF A PRIOR DATE
VERSUS RECORDED MORTGAGE ON A
LATER DATE
Between an unrecorded sale of a prior date and a
recorded mortgage of a later date, the former is
preferred to the later for reason that if the original
owner had parted with his ownership of the thing
sold then he no longer had the ownership and free
disposal of that thing so as to be able to mortgage it
again (AGCAOILI, supra at 457).
DISCHARGE OR CANCELLATION
A mortgage or lease on registered land may be
discharged or cancelled by means of an instrument
executed by the mortgagee or lessee in a form
sufficient in law, which shall be filed with the Register
of Deeds who shall make the appropriate
memorandum upon the certificate of title (P.D. 1529,
Sec. 62).
POWER OF ATTORNEY
Referred to as an authority to do some act in relation
to lands, or the creation of estates therein, or of
charges thereon, which the owner, granting or
reserving such power, might himself perform (PEÑA,
supra at 439).
Any person may, by power of attorney, convey or
otherwise deal with registered land and the same
shall be registered with the Register of Deeds of the
province or city where the land lies. Any instrument
revoking such power of attorney shall be registered
in a like manner (P.D. 1529, Sec. 64).

TRUST
Fiduciary relationship with respect to property which
involves the existence of equitable duties imposed
upon the holder of the title to the property to deal with
it for the benefit of another (AGCAOILI, supra at
477).
RULES IN THE REGISTRATION OF
TRUSTS INVOLVING REGISTERED
LANDS
TYPE HOW REGISTERED
Whenever a deed or A note shall be made
other instrument is filed upon the original
for the purpose of instrument creating or
transferring registered declaring the trust or
land in trust, or upon other equitable interest
any equitable condition a reference by number
or limitation expressed to the:
therein, or for the 1. certificate of title to
purpose of creating or which it relates; and
declaring a trust or 2. to the volume and
other equitable interest page in the
in such land without registration book
transfer. where it is registered
(P.D. 1529, Sec. 65).
Trusts with power of No instrument which
sale transfers, mortgages or
in any way deals with
registered land in trust
shall be registered
unless the enabling
power is:
1. Expressly conferred
in the trust
instrument; or
2. A final judgment or
order of a court of
competent
jurisdiction has
construed the
instrument in favor of
the power. (P.D.
1529, Sec. 66)
Implied Trusts No instrument which
transfers, mortgages or
in any way deals with
registered land in trust
shall be registered
unless the enabling
power is:
1. Expressly conferred
in the trust
instrument; or
TYPE HOW REGISTERED
2. A final judgment or
order of a court of
competent
jurisdiction has
construed the
instrument in favor
of the power. (P.D.
1529, Sec. 66)
INVOLUNTARY
DEALINGS
INVOLUNTARY DEALINGS AFFECTING
REGISTERED LAND WHICH MUST BE
REGISTERED: (ASAN)
1. Attachments (P.D. 1529, Sec. 69);
2. Sale on execution or levy for taxes or for any
assessment (P.D. 1529, Sec. 74);
3. Adverse claim (P.D. 1529, Sec. 70); and
4. Notice of lis pendens (P.D. 1529, Sec. 76).
SURRENDER OF CERTIFICATE IN
INVOLUNTARY DEALINGS
If an attachment or other lien in the nature of an
involuntary dealing in registered land is registered,
and the duplicate certificate is not presented at the
time of registration, the Register of Deeds shall,
within thirty-six hours, send notice by mail to the
registered owner requesting him to send or produce
his duplicate certificate so that a memorandum of the
attachment or other lien may be made thereon.
If the owner neglects or refuses to comply within a
reasonable time, the Register of Deeds shall report
the matter to the court, and it shall, after notice, enter
an order to the owner to produce his certificate at a
time and place named therein, and may enforce the
order by suitable process (P.D 1529, Sec. 71).
ATTACHMENT
Attachment is the legal process of seizing another's
property in accordance with a writ or judicial order
for the purpose of securing satisfaction of a
judgment yet to be rendered (AGCAOILI, supra at
483).
An attachment, or a copy of any writ, order or
process issued by a court of record, intended to
create of preserve any lien, status, right, or
attachment upon registered land, shall be filed and
registered in the Registry of Deeds for the province
or city in which the land lies (P.D 1529, Sec. 69).
When an attachment has been levied upon property,
a purchaser thereof subsequent to the attachment
takes the property subject to the attachment. But in
determining priority between two attachments on
execution affecting the same property, it is not the
priority of the execution sales held that will determine
the preference, but the priority between the two
attachments, that is, the attachment previously
registered is superior and preferred to a subsequent
one (Cruz v. Sandoval, G.R. No. L-46701, June 17,
1940).
NOTE: An attachment levied on real estate not duly
recorded in the Registry of Property is not an
encumbrance on the attached property, nor can
such attachment serve as a ground for decreeing the
annulment of the sale of property, at the request of
another creditor (Diez v. Delgado, G.R. No. L-11732,
January 12, 1918).
Discharge of Attachment
An attachment may be discharged upon giving a
counterbond, or on the ground that the same was
improperly or irregularly issued or enforced, or that
the bond is insufficient (AGCAOILI, supra at 486).
SALE ON EXECUTION OR LEVY FOR
TAXES OR FOR ANY ASSESSMENT
Whenever registered land is sold on execution, or
taken or sold for taxes or for any assessment or to
enforce a lien of any character, or for any costs and
charges incident to such liens, any execution or copy
of execution, any officer's return, or any deed,
demand, certificate, or affidavit, or other instrument
made in the course of the proceedings to enforce
such liens and required by law to be recorded, shall
be filed with the Register of Deeds of the province or
city where the land lies and registered in the
registration book, and a memorandum made upon
the proper certificate of title in each case as lien or
encumbrance (P.D. 1529, Sec. 74).
ADVERSE CLAIM
An adverse claim is a notice to third persons that
someone is claiming an interest on the property or
has a better right than the registered owner thereof,
and that any transaction regarding the disputed land
is subject to the outcome of the dispute (Sajonas v.
CA, G.R. No. 102377, July 5, 1996).
The annotation of an adverse claim is a measure
designed to protect the interest of a person over a
piece of real property, where the registration of such
interest or right is not otherwise provided for by the
Land Registration Act or Act No. 496 (now P.D. No.
1529 or the Property Registration Decree), and
serves a warning to third parties dealing with
said property that someone is claiming an interest
on the same or a better right than that of the
registered owner thereof (Valderama v. Arguelles,
G.R. No. 223660, April 02, 2018).
Claim or interest is adverse when:
1. Claimant’s right or interest in registered land is
adverse to the registered owner;
2. Such right arose subsequent to the date of
original registration; and
3. No other provision is made in the Decree for the
registration of such right or claim (P.D. 1529,
Sec. 7, par. 1).
Formal Requisites of an Adverse Claim for
Purposes of Registration: (WNR)
1. Adverse claimant must state the following in
Writing:
a. His alleged right or interest;
b. How and under whom such alleged right or
interest is acquired;
c. The description of the land in which the right
or interest is claimed; and
d. The certificate of title number.
2. Such statement must be signed and sworn to
before a Notary public; and
3. Claimant shall state his Residence or place to
which all notices may be served upon him. (P.D.
1529, Sec. 70)
Non-compliance with the formal requisites
renders such adverse claim non-registrable and
ineffective (Lozano v. Ballesteros, G.R. NO.
49470, April 8, 1991).
Registration of Notice of Adverse Claim
An adverse claim is a type of involuntary dealing
designed to protect the interest of a person over a
piece of real property by apprising third persons that
there is a controversy over the ownership of the land.
It seeks to preserve and protect the right of the
adverse claimant during the pendency of the
controversy where registration of such interest or
right is not otherwise provided for by the Property
Registration Decree. An adverse claim serves as a
notice to third persons that any transaction regarding
the disputed land is subject to the outcome of the
dispute. Before a notice of adverse claim is
registered, it must be shown that there is no other
provision in law for the registration of the claimant's
alleged right in the property (Logarta v. Mangahis,
G.R. No. 213568, July 5, 2016).
Effectivity of Adverse Claim
The adverse claim shall be effective for a period of
thirty (30) days from the date of registration. After the
lapse of said period, the annotation of adverse claim
may be canceled upon filing of a verified petition
therefore by the party in interest (P.D. 1529, Sec.
70).

No second adverse claim based on the same ground
shall be registered by the same claimant (P.D. 1529,
Sec. 70).
An adverse claim is not ipso facto cancelled upon
the lapse of thirty (30) days from its registration.
There must be a petition for the purpose to afford the
adverse claimant an opportunity to be heard
(Sajonas v. Court of Appeals, G.R No. 102377, July
5, 1996).
NOTICE OF LIS PENDENS
The notice of lis pendens is ordinarily recorded
without the intervention of the court where the action
is pending. The notice is but an incident in an action,
an extrajudicial one, to be sure. It does not affect the
merits thereof. It is intended merely to constructively
advise, or warn, all people who deal with the
property that they so deal with it at their own risk,
and whatever rights they may acquire in the property
in any voluntary transaction are subject to the results
of the action, and may well be inferior and
subordinate to those which may be finally
determined and laid down therein (J Casim
Construction Supplies, Inc., v. Registrar of Deeds of
Las Pinas, G.R. No. 168655, July 02, 2010).
The title obtained by the transferee pendente lite
(pending suit) affords him no special protection; he
cannot invoke the rights of a purchaser in good faith
and cannot acquire better rights than those of his
predecessor-in-interest (Yu v. Court of Appeals, G.R
No. 109078, December 26, 1995).
Effects of Filing Lis Pendens:
1. It keeps the subject matter of litigation within the
power of the court until entry of the final
judgment so as to prevent the defeat of the latter
by successive alienations.
2. It binds a purchaser of the land subject of the
litigation to the judgment or decree that will be
promulgated thereon whether such a purchaser
is a bona fide purchaser or not; but it does not
create a non-existent right or claim (Carrascoso
v. Court of Appeals, G.R. No. 123672,
December 14, 2005).
Annotation of Lis Pendens
To annotate a notice of lis pendens, the following
elements must be present: (CJS)
a. The property must be of such Character as to be
subject to the rule;
b. The court must have Jurisdiction both over the
person and the res
c. The property or res involved must be Sufficiently
described in the pleadings (AGCAOILI, supra at
502).
Notice of Lis Pendens; appropriate in the
following cases: (RQ-COP)
1. Action to Recover possession of real estate;
2. Action to Quiet title thereto;
3. Action to remove Clouds upon the title thereof;
4. Any Other proceeding of any kind in court
directly affecting the title to the land or the use of
occupation thereof or the building thereon; and
5. For Partition (AGCAOILI, supra at 504).
Notice of Lis Pendens, when Inapplicable:
(PAPALF)
1. Proceedings for the recovery of money
judgments;
2. Preliminary Attachments;
3. Proceedings on the probate of wills;
4. Administration of the estate of deceased
persons;
5. Levies on execution; and
6. Foreclosure
CANCELLATION OF LIS PENDENS
GENERAL RULE: Notice of Lis Pendens cannot be
cancelled while the action is pending (AGCAOILI,
supra at 505).
EXCEPTIONS: (MEND-PC)
1. When it is shown that the notice is for the
purpose of Molesting the adverse party;
2. Where the Evidence so far presented by the
plaintiff does not bear out the main allegations of
the complaint;
3. When it is shown that it is Not necessary to
protect the right of the party who caused the
registration thereof;
4. Where the continuances of the trial are
unnecessarily Delaying the determination of the
case to the prejudice of the defendant;
5. Upon verified Petition of the party who caused
the registration thereof; or
6. It is deemed Cancelled after final judgment in
favor of the defendant, or other disposition of the
action such as to terminate all rights of the
plaintiff to property involved (NOBLEJAS, supra
at 438-439).
Requisites (BOA-G):
1. Must be Before final judgment;
2. Upon Order of the court;
3. Upon Action by the Register of Deeds at the
instance of the party caused the registration OR
upon verified petition of the latter; and
4. Must be due to the Grounds mentioned (PEÑA,
supra at 485).
NOTICE OF ADVERSE CLAIM AND
NOTICE OF LIS PENDENS
Both are different remedies which may be availed of
at the same time. The annotation of a notice of lis
pendens at the back of a certificate of title does not
preclude the subsequent registration on the same
certificate of title of an adverse claim. In Paz Ty Sin
Tei v. Jose Lee Dy Piao, the Court ruled that it would
not only be unreasonable but also oppressive to hold
that the subsequent institution of an ordinary civil
action would work to divest the adverse claim of its
validity, for a notice of lis pendens may be cancelled
even before the action is finally terminated for
causes which may not be attributable to the claimant
(Valderama v. Arguelles, G.R. No. 223660, April 2,
2018).
DEALINGS WITH
UNREGISTERED LANDS
RECORDING OF INSTRUMENTS
RELATING TO UNREGISTERED LANDS
No deed, conveyance, mortgage, lease, or other
voluntary instrument affecting land not registered
under the Torrens system shall be valid, except as
between the parties thereto, unless such instrument
shall have been recorded in the manner herein
prescribed in the office of the Register of Deeds for
the province or city where the land lies (P.D. 1529,
Sec. 113).
The provision cannot be interpreted to include
conveyances made by ministerial officers, such as
sheriff’s deeds. It contemplates only such
instruments as may be created by agreement of the
parties. The provisions of Act No. 3344 do not apply
to judicial sales (AGCAOILI, supra at 676).
All instruments affecting lands originally registered
under the Spanish Mortgage Law may be recorded
under Sec. 113 of the decree until the land shall
have been brought under the operation of the
Torrens system (Id. at 675).
The books of registration of the Revised
Administrative Code, as amended by Act. No. 3344,
shall continue to be in force, provided that
unregistered land shall be registered under Sec. 113
(Id).
Where registered land has been the subject of a
transaction and this was recorded under Act no.
3344, such recording does not bind third persons
since registration thereunder refers to properties not
registered under the Land Registration Act, and
hence, not effective for purposes of Art 1544 of the
Civil Code on double sales (AGCAOILI, supra at
675).
Registration under Sec. 113 cannot defeat a
person with a better right
REASON: Registration under Sec. 113 of Act 3344
is not preceded by any investigation, whether
judicial or administrative, as to the validity or the
efficacy of the title sought to be recorded.
“BETTER RIGHT”
Refers to a right which must have been acquired by
a third party independently of the unregistered deed,
such, for instance, as title by prescription, and that it
has no reference to rights acquired under that
unregistered deed itself (PEÑA, supra at 600).
A registration of a deed of mortgage in the
unregistered land register is without prejudice to
third parties with a better right (Rivera v. Moran, G.R.
No. L-24568, March 2, 1926).
EFFECTS OF TRANSACTIONS
COVERING UNREGISTERED LAND:
1. Between the parties
– even if the transaction is not registered, the
contract is valid and binding (Dadizon v. Court
of Appeals, G.R. No. 159116, September 30,
2009); and
2. As among third persons
– the law requires that in order for the
transaction to be binding to third persons, the
same must be registered (Dadizon v. Court of
Appeals, G.R. No. 159116, September 30,
2009).
PROCEDURE FOR REGISTRATION:
1. Presentment of instrument dealing in
unregistered land; and
2. If found:
a. in order, register.
b. defective, registration is refused, writing his
reason for refusal (REV. ADM. CODE, Sec.
194, as amended by Act No. 3344).
Registration creates constructive notice only to
future dealers in unregistered land
Registration under Act 3344 does not afford full
protection, and the title registered in accordance
therewith must yield to a prior and valid title, though
unregistered, for registration under said Act can only
affect rights or interests subsequent to the
registration. It is a notice only to future dealers of the
land (PEÑA, supra at 602).
As a matter of precaution, a would-be purchaser of
an unregistered land should ascertain for himself
whether the seller is, at the time of the transaction,
still the owner of the property, and the most practical
way of ascertaining such fact is to proceed to the
land to find out the persons in actual possession
thereof and to inquire from them in what capacity
they possess and occupy the land. The rule that the
purchaser is not required to explore further than
what the record in the Registry indicates upon its
face in quest of any hidden defect or inchoate right
which may subsequently defeat his right thereto
refers only to property registered under the Torrens
system (Id. at 603).
Unregistered donation propter nuptias does not
bind third persons
Prior unregistered donation does not bind
respondents, who are innocent purchasers for value.
Registration is not necessary for it to be considered
valid and effective. However, in order to bind third
persons, the donation must be registered in the
Registry of Property (now Registry of Land Titles and
Deeds). Although the non-registration of a deed of
donation shall not affect its validity, the necessity of
registration donation shall not affect its validity, the
necessity of registration comes into play when the
rights of third persons are affected (Spouses Cano
v. Spouses Cano, G.R. No. 188666, December 14,
2017).
Primary Entry Book and Registration Book
The Register of Deeds for each province or city shall
keep a Primary Entry Book and a Registration Book.
The Primary Entry Book shall contain, among other
particulars, the entry number, the names of the
parties, the nature of the document, the date, hour,
and minute it was presented and received. The
recording of the deed and other instruments relating
to unregistered lands shall be effected by any
annotation on the space provided therefor in the
Registration Book, after the same shall have been
entered in the Primary Entry Book (P.D. 1529, Sec.
113, par. a).
Primary Entry Book (Day Book)
Provides spaces whereon to enter the names of the
parties, the nature of the instrument or deed for
which registration is requested, the hour and minute,
date and month of the year when the instrument is
received (AGCAOILI, supra at 447).
Effect of Sufficiency of the Instrument
If, on the face of the instrument, it appears that it is
sufficient in law, the Register of Deeds shall forthwith
record the instrument in the manner provided herein.
In case the Register of Deeds refuses its
administration to record, said official shall advise the
party in interest in writing of the ground or grounds
for his refusal, and the latter may appeal the matter
to the Commissioner of Land Registration in
accordance with the provisions of Section 117 of
P.D. 1529. It shall be understood that any recording
made under this section shall be without prejudice to
a third party with a better right (P.D. 1529, Sec. 113,
par. b).
INVOLUNTARY DEALINGS WITH
RESPECT TO UNREGISTERED LANDS
Tax sale, attachment and levy, notice of lis pendens,
adverse claim and other instruments in the nature of
involuntary dealings with respect to unregistered
lands, if made in the form sufficient in law, shall
likewise be admissible to record under this section
(P.D. 1529, Sec. 113, par. b).
I. VOLUNTARY TRANSACTIONS
Sale, Donation, Settlement, Adjudication, Partition,
Mortgage, Exchange, Lease, Merger
Common Requirements
1. Original copy of the deed/instrument;
NOTE: If the original copy cannot be produced,
the duplicate original or certified true copy shall
be presented with a sworn affidavit executed by
the interested party stating why the original copy
cannot be presented.
2. Owner’s and co-owner’s copy of the certificate
of title for land registered;
3. Tax Declaration for deed/instrument involving
transfer of ownership; and
4. DAR Clearance and Affidavit of Aggregate Land
Holding of the Transferee for land covered by
CARP.
Specific Requirements
1. BIR certificate authorizing registration;
NOTE: For payment of capital gains tax, estate
tax and donor’s tax, as the case may be
2. Revenue tax receipts evidencing payment of
documentary stamp tax if the amount paid is
P10.00 and above;
NOTE: If the documentary stamp tax is less than
P10.00, documentary stamps shall be attached
to the document
3. Real property tax clearance indicating the tax
declaration number; and
4. Proof of the payment of the transfer tax.
EXCEPTION: If the document was executed before
July 1, 1973.
NOTE: If the transferor or transferee is a
corporation:
a) Secretary’s Certificate/Board Resolution to
purchase/sell
b) Articles of Incorporation of transferee
 c) Certificate of the SEC that the articles of
incorporation has been registered.
NOTE: If the land being transferred is covered by
patent, the deed of sale is to be approved by the
Regional Executive Director of DENR.
Additional Requirements:
1. For Extrajudicial Settlement/Adjudication
Affidavit of Publication of the publisher/editor
stating that the deed/instrument had been
published for three consecutive weeks. If the
deed includes personal property, a bond shall
be filed.
2. Sale of Subdivision Lots License to Sell and/or
Certificate of Registration by HLURB in case
of subdivision projects.
3. Power of attorney or any deed/instrument
executed abroad
– Certificate of Authentication by the nearest
Philippine Consulate
4. Judicial Settlement of Estate
a. Order approving the project of partition;
b. Certificate of Finality of the
order/termination of special proceeding;
c. Letters of Administration – if the property
is encumbered or sold during the
settlement proceedings.
5. Mortgages and Lease
a. Certificate of non-delinquency in the
payment for real estate tax;
b. Documentary Stamp tax
6. Extrajudicial Foreclosure of Mortgage
a. Certificate of Sale by the sheriff;
b. Approval of the RTC Executive Judge
(except where the sale was conducted by
the notary public);
c. Documentary Stamp Tax
7. Consolidation of Ownership
– Affidavit of Consolidation of the
purchase/deed of sale of the mortgage
8. Judicial Foreclosure of Mortgage
a. Court Order directing the sale by public
auction;
b. Certificate of sale issued by the sheriff
9. Execution Sale
a. Notice of Levy or Attachment must
first be annotated/accompanied with a
writ of execution;
b. Certificate of Sale;
c. Final Deed of Sale.
10. For Subdivision and/or Consolidation Plan
Without change or ownership
a. Letter-request
b. Tracing cloth of the plan duly
approved by the LRA or the LMB
c. Blueprint of the plan
d. Original technical description
With change of ownership
1) Agreement of partition
2) Real estate tax clearance
II. INVOLUNTARY TRANSACTIONS
A. Lis Pendens
1. Notice containing the following:
a. Date of institution of the action;
b. Court where the action is pending
2. Copy of the complaint
3. Certificate of title number
How Cancelled?
1. Order of the court to cancel the notice;
2. Certificate of the clerk of court stating
the manner of disposition;
3. Sworn statement of the counsel for
plaintiff who caused the filing of the
notice
B. Adverse Claim
Sworn statement stating the following:
1. Alleged claim against the registered
owner of the property;
2. Certificate of title number and
reference to volume and page
number;
3. Description of the land;
4. Address of the adverse claimant
How Cancelled?
1. Before the lapse of 30 days;
2. After the lapse of 30 days by verified
petition before the RD by the party-in-
interest;
3. By order of the court;
4. By sworn petition before the RD, or
the claimant withdrawing his claim
C. Sale at Public Auction for Non-
Payment of Taxes
1. Certificate of Sale executed by the
City Treasurer;
2. Final Bill of Sale if to be consolidated;
3. Common Requirements if title is not
available, order of the court for
issuance of new owner’s copy and
annulment of previous owner’s copy.

DECREE OF
REGISTRATION
DECREE OF REGISTRATION
It is an order issued under the signature of the
Administrator of the Land Registration Authority, in
the name of the court, stating the land described
therein is registered in the name of the applicant or
oppositor or claimant as the case may be
(AGCAOILI, supra at 370).
As provided by law, if the court finds after hearing
that the applicant or adverse claimant has title as
stated in his application or adverse claim and proper
for registration, a decree of confirmation and
registration shall be entered. (ACT NO. 3261, Sec.
3).
PURPOSE: The decree of registration binds the
land, quiets title thereto, subject only to such
exceptions or liens as may be provided by law. It is
conclusive upon all persons including the national
government and all branches thereof, whether
mentioned by name in the application or notice, the
same being included in the general description “To
All Whom It May Concern.” (PEÑA, supra at 131).
The duty of the land registration officials to issue the
decree of registration is ministerial in the sense that
they act under the orders of the court and the decree
must be in conformity with the court judgment and
with the data found in the record. However, if they
are in doubt upon any point in relation to the
preparation and issuance of the decree, they are
duty-bound to refer the matter to the court. They act
in this respect, as officials of the court. The
administrator is thus not legally obligated to issue the
decree where, upon his verification, he finds that
subject land has already been decreed and titled in
another’s name (Ramos v. Rodriguez, G.R. No.
94033, May 29, 1995).
A decree of registration issued pursuant to the Land
Registration Act only confirms ownership of the
applicant over the land subject of the application
(Torela v. Torela, G.R. No. L-27843, October 11,
1979).
By whom issued: Administrator of Land
Registration who signs the decree of registration and
attests the date and hour or its issuance (P.D. 1529,
Sec. 31).
FINALITY OF THE DECREE
The decree becomes incontrovertible after one (1)
year from the date of its entry (P.D. 1529, Sec. 32).
PERIOD OF ISSUANCE OF THE DECREE
GENERAL RULE: The law does not limit the period
within which the court may order the issuance of a
decree of registration.
EXCEPTION: Decree of Registration Cannot Be
Issued Pending Appeal
In any event, it was held that execution pending
appeal is not applicable to a land registration
proceeding. A Torrens title issued on the basis of a
judgment that is not final is a nullity, as it is violative
of the explicit provision of the Land Registration Act
which requires that a decree be issued only after the
decision adjudicating the title becomes final and
executory, and it is on the basis of said decree that
the Register of Deeds concerned issues the
corresponding certificate of title (Top Management
Programs Corporation v. Fajardo, G.R. No. 150462,
June 15, 2011).
CONTENTS: (D³OM)
1. Date, hour and minute of its entry;
2. If the owner is under a Disability, the nature of
such disability; and if a minor, his age;
3. Description of the land, estate of the owner, and,
in such manner as to show their relative
priorities, all particular estates, mortgages,
easements, liens, attachments, and other
encumbrances;
4. It shall state whether the owner is Married or
unmarried, and if married, the name of spouse.
If the land is conjugal property, the decree shall
be issued in the name of both spouses; and
5. Other matters to be determined in pursuance of
law (P.D. 1529, Sec. 31).
DISTINCTIONS BETWEEN A DECISION
IN LAND REGISTRATION CASE
AND DECREE OF REGISTRATION
DECISION IN LAND
REGISTRATION DECREE OF
CASE REGISTRATION
As to Manner of Issuance
Rendered by the court Issued by the Land
and signed by the Registration Authority
judge. and signed by the Land
Registration
Commissioner.

DECISION IN LAND
REGISTRATION DECREE OF
CASE REGISTRATION
As to Finality
Becomes final after 30 Becomes final after 1
days from issuance. year from issuance.
As to Grounds for Review
Found in Rules 37 and Fraud and must be filed
38 of the Rules of Court. within one year from
issuance.
(ALBANO, supra at 816-817).
PARTIAL JUDGMENT
AND POST JUDGMENT
INCIDENTS IN
ORDINARY LAND
REGISTRATION
PARTIAL JUDGMENT
In a land registration proceeding where only a
portion of the land subject of registration is
contested, the court may render partial judgment
provided that a subdivision plan showing the
contested and uncontested portions approved by the
Director of Lands is previously submitted to said
court (P.D. 1529, Sec. 28).
When the law confers jurisdiction upon a court, the
latter is deemed to have all necessary powers to
exercise such jurisdiction to make it effective (SM
Prime Holdings, Inc. v. Madayag, G.R, No. 164687,
February 12, 2009).
Court Retain Jurisdiction until after final entry of
decree
While the judgment of the court becomes final 15
days from receipt of notice of the judgment, the court
nevertheless retains jurisdiction over the case until
after the expiration of one year from the issuance of
the decree of registration by the Land Registration
Authority (AGCAOILI, supra at 267).
POST-JUDGMENT INCIDENTS
Writ of Possession
GENERAL RULE: The judgment adjudicating
ownership to the successful applicant impliedly
carries with it the delivery of possession if he is
deprived, since the right of possession is inherent in
that of ownership (Vencilao v. Vano, G.R. No. L-
25660, February 23, 1990).
EXCEPTIONS:
1. A writ of possession does not lie in a land
registration case against a person who entered
the property after the issuance of the final
decree and who had not been a party in the
case; and
2. A writ of possession cannot be issued in a
petition for reconstitution of allegedly lost or
destroyed certificate of title (AGCAOILI, supra at
270-272).
The issuance of a writ of possession is only a matter
of course if nothing in the past has been issued in
favor of the registered owner; there is no prescription
as to its issuance (Lucero v. Loot, G.R. No. L-16995,
October 28, 1968).
Writ of Demolition
A writ of demolition must, likewise, issue, especially
considering that the said writ is but complement of a
writ of possession. Without such the latter shall be
ineffective (AGCAOILI, supra at 270).
REMEDIES
REMEDIES OF AGGRIEVED PARTY IN
REGISTRATION PROCEEDINGS:
1. BEFORE JUDGMENT BECOMES
FINAL:
a. Motion for Reconsideration
Grounds: (DED)
i. Damages awarded are excessive;
ii. Evidence is insufficient to justify the
decision or final order;
iii. Decision or final order is contrary to law.
(RULES OF COURT, RULE 37, Sec. 1)
b. Motion for New Trial
Grounds: (FAN)
i. Fraud, accident, mistake or excusable
negligence which ordinary prudence
could not have guarded against and by
reason of which such aggrieved party
has probably been impaired in his
rights;
ii. Newly discovered evidence which with
reasonable diligence could have not
been discovered and produced at the
trial and which if presented would
 probably alter the result (RULES OF
COURT, RULE 37, Sec. 1)
Period of filing: Within the fifteen (15)-day
period for perfecting an appeal (B.P. 129, Sec.
39; Heirs of Labrada v. Monsanto, G.R. No. L-
66242, August 31, 1984).
2. AFTER JUDGMENT BECOMES FINAL
BUT BEFORE ISSUANCE OF
DECREE OF REGISTRATION:
a. Annulment of Judgment
It may only be availed of when the ordinary
remedies of new trial, appeal, petition for
relief or other appropriate remedies are no
longer available without the fault of
petitioners and is based on only two
grounds: extrinsic fraud and lack of
jurisdiction(Linzag v. CA, G.R. No. 122181,
June 26, 1998).
b. Petition for Relief from Judgment
Grounds: When a judgment or final order is
rendered by any court in a case, and a party
thereto, by fraud, accident, mistake or
excusable negligence, he may file a petition
in such court praying that the judgment,
order or proceeding be set aside (RULES
OF COURT, RULE 38, Sec. 1).
This relief is applicable to land registration
cases if the petition is filed within the time
therein provided and the decree of
registration is not yet issued (PEÑA, supra
at 171).
Subsidiary Nature: Relief may not be
availed of except when the decision
becomes final and executory, and only when
a new trial is not available (AGCAOILI,
supra at 280).
Period of Filing: Within sixty (60) days after
the petitioner learns of the judgment, order,
or proceeding and not more than six (6)
months after such judgment or order was
entered or such proceeding was taken (Id.
at 280).
c. Appeal from Judgment
Under P.D. 1529, judgments and orders in
land registration cases are appealable to the
Court of Appeals or to the Supreme Court in
the same manner as ordinary actions (P.D.
1529, Sec. 33)
Must be filed within fifteen (15) days from
receipt of the judgment or final order
appealed from (AGCAOILI, supra at 281).
3. AFTER ISSUANCE OF DECREE OF
REGISTRATION:
a. Petition for Review of a Decree
This remedy is available only to an
aggrieved party who has been deprived of
land or any estate or interest therein by
decree of registration, and the only ground
that may be invoked for this purpose is
actual fraud (PEÑA, supra at 164).
When to file: Not later than one year from
and after the date of entry of such decree of
registration (P.D 1529, Sec. 32).
However, it has been ruled that the petition
may be filed at any time after the rendition
of the court’s decision and before the
expiration of one (1) year from the entry of
the final decree of registration, for there can
be no possible reason for requiring the
complaining party to wait until the final
decree is entered before urging his claim of
fraud (Rivera v. Moran, G.R No. 24568,
March 2, 1926).
Review of Judgment v. Review of the
Decree
It is a petition for review of judgment when it
is filed after rendition of the decision but
before the entry of the decree of registration.
And it is a petition for review of the decree
of registration when it is filed not later than
one year from and after the date of the entry
of such decree of registration, but in no case
shall such petition be entertained by the
court where an innocent purchaser for value
has acquired the land or an interest therein,
whose rights may be prejudiced.
Intentional concealment and representation
as possessor, occupant and claimant
constitutes actual fraud justifying the
reopening and review of the decree of
registration (Heirs of Manuel Roxas v. CA,
G.R. No. 118436, March 21, 1997).
Grounds for Review of the Decree:
Actual or Extrinsic Fraud – an intentional
omission of fact required by law to be stated in
the application or a willful statement of a claim
against the truth. It must show some specific
acts intended to deceive and deprive another of
his right (Libudan v. Palma Gil, G.R No. L-
21163, May 17, 1972).
 Philippines, Inc. v. Garcia, G.R. No. 173289,
Instances of Actual or Extrinsic Fraud February 17, 2010).
Actual fraud proceeds from an intentional
deception practiced by means of the b. Action for Reconveyance
misrepresentation or concealment of a material A legal and equitable remedy granted to the
fact. Extrinsic fraud is employed to deprive rightful owner of land which has been wrongfully
parties of their day in court and thus prevent or erroneously registered in the name of another
them from asserting their right to the property for the purpose of compelling the latter to
registered in the name of the applicant transfer or reconvey the land to him (Narvasa v.
(Mendoza v. Valte, G.R. No. 172961, Imbornal, G.R. No. 182908, August 6, 2014).
September 07, 2015).
Extrinsic fraud is also actual fraud, but Requisites (NFN-F-4-10):
collateral to the transaction sued upon (Sps. Cal i. The action must be brought in the Name of
v. Zosa, G.R. No. 152518, July 31, 2006). a person claiming ownership or dominical
right over the land registered in the name of
ACTUAL FRAUD V. the defendant;
CONSTRUCTIVE FRAUD ii. The registration of the land in the name of
the defendant was procured through Fraud
ACTUAL CONSTRUCTIVE or other illegal means;
FRAUD FRAUD iii. The property has Not yet passed to an
innocent purchaser for value; and
Proceeds from an Act is not done or iv. The action is filed after the certificate of title
intentional deception committed with an had already become Final and
practiced by means of actual design to incontrovertible but within four (4) years
misrepresentation or commit positive fraud from the discovery of the fraud, or not later
concealment of a or injury upon other than ten (10) years in case of an implied
material fact. persons but is trust (AGCAOILI, supra at 295 citing Balbin
construed as fraud v. Medalla, G.R. No. L-16410, October 30,
because of its 1981, New Regent Sources, Inc. v.
detrimental effect upon Tanjuatco, G.R. No. 168800, April 16, 2009)
public interest and
public or private Reconveyance is available not only to the
confidence. legal owner of property, but also to the
person with a better right than the person
(NOBLEJAS, supra at 221).
under whose name said property was
erroneously registered (Pacete v. Asotigue,
EXTRINSIC FRAUD V. INTRINSIC G.R. No. 188575, December 10, 2012).
FRAUD
EXTRINSIC INTRINSIC FRAUD May be filed even after the lapse of one (1)
FRAUD year from entry of the decree of registration
as long as the property has not been
Prevents a party Where the fraudulent acts transferred or conveyed to an innocent
from having a trial pertain to an issue involved purchaser for value (NOBLEJAS, supra at
or from presenting in the original action, or 237).
his entire case to where the acts constituting
the court. the fraud were or could have An action for reconveyance does not aim or
been litigated therein. purport to reopen the registration
proceedings and set aside the decree of
(Id. at 223). registration but only to show that the person
who secured the registration of the
Requisites for Review of the Decree: questioned property is not the real owner
i. The petitioner must have an estate or thereof. The action, while respecting the
interest in the land; decree as incontrovertible, seeks to transfer
ii. He must show actual fraud in the or reconvey the land from the registered
procurement of the decree of registration; owner to the rightful owner. Reconveyance
iii. Petition is filed within one (1) year from is always available as long as the property
issuance of the decree by the LRA; and has not passed to an innocent third person
iv. The property has not yet passed to an for value (Hortizuela v. Tagufa, G.R. No.
innocent purchaser for value (Eland 205867, February 23, 2015).
 When Reconveyance Does Not
Prescribe:
i. If brought by registered owners or their
children;
ii. A co-heir, who, through fraud, succeeds
in obtaining a certificate of title in his
name to the prejudice of his co-heirs, is
deemed to hold the land in trust for the
latter. The excluded heir’s action is
imprescriptible; or
iii. Where the plaintiff in an action for
reconveyance, which is in effect an
action to quiet title, is in possession of
the land in question (AGCAOILI, at
301).; or
iv. Right of reversion or reconveyance to
the state of public properties
fraudulently registered and which are
not capable of private appropriation or
private acquisition (Martinez v. CA, G.R
No. L-31271, April 29, 1974).
GROUNDS FOR RECONVEYANCE AND
CORRESPONDING PERIOD OF
PRESCRIPTION
GROUNDS PRESCRIPTIVE PERIOD
Four (4) years from the discovery
of the fraud (deemed to have
taken place from the issuance of
Fraud the original certificate of title). No
trust is created (Balbin v.
Medalla, G.R. No. L-46410,
October 30, 1981).
Ten (10) years from the date of
the registration of the deed or the
date of issuance of the OCT or
TCT.
NOTE: The above rule does not
Implied or
apply where the person enforcing
Constructive
the trust is in actual possession of
Trust
the property because he is in
effect seeking to quiet title to the
same which is imprescriptible
(D.B.T. Mar-Bay Construction,
Inc. v. Panes, G.R. No. 167232,
July 31, 2009).
Imprescriptible (Caezo v. Rojas,
Express
G.R No. 148788, November 23,
Trust
2007)
Imprescriptible (Casipit v. CA,
Void
G.R. No. 140457, January 19,
Contract
2005)
Implied/constructive trusts are created in equity in
order to prevent unjust enrichment. They arise
contrary to intention against one who, by fraud,
duress or abuse of confidence, obtains or holds the
legal right to property which he ought not, in equity
and good conscience, hold (Marquez v. CA, G.R.
No. 125715, December 29, 1998).
c. Action for Damages
May be resorted to when a petition for
review and an action for reconveyance is no
longer possible because the property has
passed to an innocent purchaser for value
and in good faith (NOBLEJAS, supra at
342).
An ordinary action for damages prescribes
in ten (10) years after the issuance of the
Torrens title over the property (AGCAOILI.
at 314).
d. Cancellation Suits
Initiated by a private party usually in a case
where two certificates are issued to different
persons covering the same land. When one
of the two titles is held to be superior over
the other, one should be declared null and
void and ordered cancelled (AGCAOILI,
supra at 322).
The judgment would direct the defeated
party to vacate the land in question, and
deliver possession thereof to the lawful
owner of the land (Id. at 322).
e. Criminal Action
The State may criminally prosecute for
perjury the party who obtains registration
through fraud, such as by stating false
assertions in the sworn answer required of
applicants in cadastral proceedings (People
v. Cainglet, G.R. Nos. L-21493-94, April 29,
1966).
f. Action for Compensation from
Assurance Fund
One who files an action for damages from
the party who allegedly registered the
property through fraud, and the latter,
becomes insolvent or is barred by
prescription, may file an action for recovery
under the Assurance Fund within a period of
six (6) years from the time the right to bring
the action accrues (P.D. 1529, Sec. 95).
Requisites:
i. The aggrieved party sustained loss or
damage, or is deprived of land or any
estate or interest therein;
ii. Such loss, damage or deprivation:
 i. Was occasioned by the bringing of
the land under the operation of the
Torrens system; or
ii. Arose after original registration of
land;
iii. The loss, damage or deprivation was
due to:
1.) Fraud; or
2.) Any error, omission, mistake or
misdescription in any certificate of
title or in any entry or memorandum
in the registration book;
iv. There was no negligence on his part;
v. He is barred or precluded under the
provisions of P.D. 1529 or under the
provision of any law from bringing an
action for the recovery of such land or
the estate or interest therein; and
vi. The action has not prescribed
(AGCAOILI, supra at 324-325).
NOTE: It is a condition sine qua non that the
person who brings the action for damages
against the Assurance Fund be the
registered owner and, as the holders of the
TCT, that they be innocent purchasers in
good faith and for value (Eagle Realty
Corporation v. Republic, G.R. No. 151424,
July 4, 2008).
REASON: It is only after the registration of
the innocent purchaser for value's title (and
not the usurper's title which constitutes a
breach of trust) can it be said that the
claimant effectively "sustains loss or
damage, or is deprived of land or any estate
or interest therein in consequence of the
bringing of the land under the operation of
the Torrens system.” (Spouses
Stilianopoulos v. The Register of Deeds for
Legazpi City and the National Treasurer,
G.R. No. 224678, July 3, 2018).
Limitation of Action
GENERAL RULE: Must be instituted within
a period of six (6) years from the time the
right to bring such action first occurred which
is from the moment the plaintiff suffered loss
or damage or was deprived of his property
or interest therein.
EXCEPTION: The action may be instituted
at any time within two (2) years after such
disability has been removed,
notwithstanding the expiration of the original
period of six (6) years IF the person entitled
to bring such right of action was a minor or
insane or imprisoned or otherwise under
legal disability (P.D. 1529, Sec. 102).
NOTE: The right of action herein provided
shall survive to the legal representative of
the person sustaining loss or damage
unless barred in his lifetime (P.D. 1529, Sec.
102).
Actions for compensation against the
Assurance Fund grounded on fraud
Registration of the innocent purchaser for
value's title should only be considered as a
condition sine qua non to file such an action
and not as a form of constructive notice for
the purpose of reckoning prescription. This
is because the concept of registration as a
form of constructive notice is essentially
premised on the policy of protecting the
innocent purchaser for value's title, which
consideration does not, however, obtain in
Assurance Fund cases. The constructive
notice rule on registration should not be
made to apply to title holders who have been
unjustly deprived of their land without their
negligence. The actual title holder cannot be
deprived of his or her rights twice – first, by
fraudulent registration of the title in the name
of the usurper and second, by operation of
the constructive notice rule upon registration
of the title in the name of the innocent
purchaser for value (Spouses Stilianopoulos
v. The Register of Deeds for Legazpi City
and the National Treasurer, G.R. No.
224678, July 3, 2018).
g. Action for Reversion
The objective of an action for reversion of
public land is the cancellation of the
certificate of title and the resulting reversion
of the land covered by the title to the State
(AGCAOILI, at 314).
Generally, an action for reversion may be
instituted by the government, through the
Solicitor General, in all cases where lands of
the public domain and the improvements
thereon and all lands are held in violation of
the Constitution, or in cases of fraudulent or
unlawful inclusion of land in patents or
certificate of title (Id at 315).
h. Quieting of Title
An action that is brought to remove clouds
on the title to real property or any interest
therein, by reason of any instrument, record,
claim, encumbrance or proceeding which is
apparently valid or effective but is in truth
and in fact invalid, ineffective, voidable, or
unenforceable, and may be prejudicial to
said title (CIVIL CODE, Art. 476). It is an
ordinary civil remedy (Sy, Sr. v. IAC, G.R.
No. L-66741, June 16, 1988).

CERTIFICATE OF TITLE
CERTIFICATE OF TITLE
This is the true copy of the decree of registration or
the transcription thereof and, similar to the decree,
shall also be signed by LRA Administrator (P.D.
1529, Sec. 39).
The certificate, once issued, is the evidence of title
which the owner has. What appears on the face of
the title is controlling on the questions of ownership
since the certificate of title is an absolute and
indefeasible evidence of ownership of the property
in favor of the person whose name appears therein
(Panganiban v. Dayrit, G.R. No. 151235, July 28,
1995).
The original certificate of title shall be a true copy of
the decree of registration. It takes effect upon the
date of entry thereof, and the land covered thereby
becomes a registered land on that date (P.D. 1529,
Sec. 40).
Registration does not vest title. It is merely evidence
of such title over a particular property. A Torrens
certificate is the best evidence of ownership over
registered land (Villanueva v. CA, G.R. No. 84464,
June 21, 1991; Chavez v. PEA & Amari Coast Bay
Dev’t. Corp., G.R. No. 133250, July 9, 2002).
However, simple possession of a certificate of title
does not necessarily make the holder thereof a true
owner of all the property described therein such as
when title includes by mistake or oversight, land
which can no longer be registered under the Torrens
system, as when the same land has already been
registered and an earlier certificate for the same land
is in existence (Caragay-Layno v. CA, G.R. No. L-
52064, December 26, 1984).
In determining whether a property belongs to the
conjugal partnership or paraphernal property of one
of the spouses, it is important to note in whose name
or names the title is registered. This is so because
the certificate of title does not establish the time of
the acquisition of the property. It only confirms a
preexisting title (Ponce de Leon v. Rehabilitation
Finance Corp., G.R. No. L-24571, December 18,
1970).
SPLITTING OR CONSOLIDATION OF
TITLES
The former practice of securing the approval of the
court before a registered owner may split or
consolidate his title has been done away with R.A
440, amending Sec. 44 of The Land Registration Act
and Sec. 49 of Property Registration Decree (PEÑA,
supra at 206).
1. Splitting of Titles
– upon petition by a registered owner of two or
more parcels of land described in a certificate of
title, the Register of Deeds may cancel the
certificate and issue in lieu thereof several new
certificates each covering one or such number
of parcels as the owner may desire, without the
necessity of obtaining a prior authority of the
court (R.A. 440, Sec. 1)
2. Consolidation of Titles
– a registered owner of several distinct parcel of
land described in separate certificates of title
may, if he desires, cause all his certificates be
cancelled and in lieu thereof a single certificate
be issued for the different portions thereof, by
direct application to the Register of Deeds (R.A.
440, Sec. 1).
ATTRIBUTES AND LIMITATIONS ON
CERTIFICATES OF TITLE AND
REGISTERED LANDS:
1. Free from Liens and Encumbrances (P.D.
1529, Sec. 44)
GENERAL RULE: Claims and liens of whatever
character existing against the land prior to the
issuance of the certificate of title are cut off by
such certificate and the certificate so issued
binds the whole world, including the
government.
EXCEPTIONS: (CeNTPD)
a. Those noted on the Certificate;
b. Liens claims or rights arising or existing
under the laws and the Constitution, which
are Not by law, required to appear of record
in the Register of Deeds in order to be valid;
c. Unpaid real estate Taxes levied and
assessed within two (2) years immediately
preceding the acquisition of the right over
the land by an innocent purchaser for value;
d. Any Public highway, or private way
established or recognized by law, or any
government irrigation canal or lateral
thereof, if the certificate of title does not
state the boundaries of such highway or
irrigation canal, or lateral thereof have been
determined; and
e. Any Disposition of the property or limitation
on the use thereof pursuant to P.D. 27 or
any other law or regulations on agrarian
reform (P.D. 1529, Section 44).
2. Incontrovertible and Indefeasible
GENERAL RULE: Upon the expiration of one
(1) year from and after the entry of the decree of
registration in the LRA, the decree and the
corresponding certificate of title becomes
incontrovertible and indefeasible (P.D. 1529,
Sec. 32).
EXCEPTIONS: (PNF)
a. If Previous valid title of the same land exists;
(Hodges v. Dy Buncio, G.R. No. L-16096,
October 30, 1962);
b. When the land covered is Not capable of
registration (Palomo v. CA, G.R. No. 95608,
January 21, 1997); and
c. When the acquisition of certificate is
attended by Fraud. (Meneses v. CA, G.R.
No. 82220, July 14, 1995).
3. Registered Land Not Subject to
Prescription
No title to registered land in derogation of the
title of the registered owner shall be acquired by
prescription or adverse possession (P.D. 1529,
Sec. 47).
Thus, even adverse, notorious and continuous
possession under a claim of ownership for the
period fixed by law is ineffective against a
Torrens title (J.M. Tuason and Co., Inc. v. CA,
G.R. No. L-23480, September 11, 1979).
The fact that title to the land was lost does not
mean that the land ceased to be a registered
land before the reconstitution of its title. It
cannot perforce be acquired by prescription
(Rivera v. CA, G.R. No. 107903, May 22, 1995).
The defense of laches is an equitable one and
does not concern itself with the character of the
defendant's title, but only with whether or not by
reason of the plaintiff's long inaction or
inexcusable neglect he should be barred from
asserting his claim at all because to allow him to
do so would be inequitable and unjust to
defendant (Vda. de Tirona v. Encarnacion, G.R.
168902, September 28, 2007).
4. Certificate of Title Not Subject to
Collateral Attack
A certificate of title shall not be subject to
collateral attack. It cannot be altered, modified,
or cancelled except in a direct proceeding in
accordance with law (P.D. 1529, Sec. 48).
Time and again, it has been held that a
certificate of title shall not be subject to a
collateral attack and that the issue of the validity
of title can only be assailed in an action
expressly instituted for such purpose. Hence,
any declaration that may have been made in an
accion publiciana cannot affect ownership over
the property nor nullify a Torrens title, as the
adjudication was only for the purpose of
resolving the issue of possession (Heirs of
Amistoso v. Vallecer, G.R. No. 227124,
December 06, 2017).
Three (3) actions considered as collateral
attack:
a. Defendants filed an answer to the complaint
praying for cancellation of the TCT of
plaintiff and for the award of damages by
counterclaim. The prayer for cancellation is
a collateral attack and cannot be done
(Cimafranca v. IAC, G.R. No. L-68687,
January 31, 1987).
b. Attack on the title of land presented in the
answer of defendant (Republic v. Samson-
Tatad, G.R. No. 187677, April 1, 2013)
c. An action for reformation is considered a
collateral attack on Torrens Title when the
land in controversy lies within the
boundaries determined by such title.
(Toyota Motors Philippines Corp. v. CA,
G.R. No. 102881, December 7, 1992).
5. Includes Improvements on Land
GENERAL RULE: Torrens certificate of title
covers the lands described therein, together with
all the buildings and improvements existing
thereon.
EXCEPTIONS: (RePNa)
a. An express Reservation shall have been
annotated on the certificate;
b. Public thoroughfares as were already in
existence at the time title was acquired;
c. Navigable streams within the registered
property unless the boundaries or such
stream had been expressly delimited in the
registration plan (PEÑA, supra at 226).
GENERAL INCIDENTS OF REGISTERED
LAND
Registered land shall be subject to such burdens
and incidents as may arise by operation of law (P.D.
1529, Sec. 46).
REGISTERED LAND OR THE OWNERS
THEREOF ARE NOT RELIEVED FROM
THE FOLLOWING:
1. Any rights incident to the relation of husband
and wife or landlord and tenant;
2. Liability to attachment or levy on execution;
3. Liability to any lien of any description
established by law on the land and buildings
thereon, or in the interest of the owner in such
land or building;
4. Any right or liability that may arise due to change
of the law of descent;
5. The rights of partition between co-owners;
6. The right of government to take the land by
eminent domain;
7. Liability to be recovered by an assignee in
insolvency or trustee or bankruptcy under the
laws relative to preferences; and
8. Any other rights or liabilities created by law and
applicable to unregistered land (P.D. 1529, Sec.
46).
PERSONS ENTITLED TO A DUPLICATE
CERTIFICATE OF TITLE:
1. Registered owner; and
2. Each co-owner (P.D. 1529, Sec. 41).
RECONSTITUTION OF
CERTIFICATE OF TITLE
RECONSTITUTION OF CERTIFICATE OF
TITLE
The reconstitution of a certificate of title denotes the
restoration in its original form and condition of a lost
or destroyed original or transfer certificate of title on
file in the office of the Register of Deeds (Paulino v.
CA, G.R. No. 205065, June 4, 2014).
PURPOSE: To have the same reproduced, after
proper proceedings, in the same form they were
when the loss or destruction occurred (Heirs of
Pedro Pinote v. Dulay, G.R. No. L-56694, July 2,
1990; Sebastian v. Spouses Cruz, G.R. No. 220940,
March 20, 2017).
Reconstitution denotes the restoration of the
certificate of title allegedly lost or destroyed in its
original form and conditions; it does not pass upon
the question of ownership (Republic v. Santua, G.R
No. 155703, September 8, 2008).
It partakes of a land registration proceeding. Thus, it
must be granted only upon clear proof that the title
sought to be restored was indeed issued to the
petitioner or his predecessor-in-interest, and such
title was in force at the time it was lost or destroyed
(Luriz v. Republic, G.R. No. 208948, February 24,
2016).
For an order of reconstitution to issue, the following
elements must be present: (LS-RFS)
1. The certificate of title has been Lost or
destroyed;
2. The documents presented by petitioner are
Sufficient and proper to warrant reconstitution;
3. The petitioner is the Registered owner of the
property or had an interest therein;
4. The certificate of title was in Force at the time it
was lost or destroyed; and
5. The description, area and boundaries of the
property are Substantially the same as those
contained in the lost or destroyed certificate of
title (Republic v. Lorenzo, G.R. No. 172338,
December 10, 2012).
When the owner's duplicate certificate of title
has not been lost, but is, in fact, in the
possession of another person, then the
reconstituted certificate is void
The Court has held that when the owner's duplicate
certificate of title has not been lost, but is, in fact, in
the possession of another person, then the
reconstituted certificate is void, because the court
that rendered the decision had no jurisdiction (Dy v.
Aldea, G.R. No. 219500, August 9, 2017).
In reconstitution proceedings, the Court has
repeatedly ruled that before jurisdiction over the
case can be validly acquired, it is a condition sine
qua non that the certificate of title has not been
issued to another person (Sebastian v. Spouses
Cruz, G.R. No. 220940, March 20, 2017).
KINDS OF RECONSTITUTION:
A. JUDICIAL RECONSTITUTION
– partakes of the nature of a land registration
proceeding in rem.
The judicial mode is the general mode which is
applicable to all cases of reconstitution. It
requires filing a petition in the proper Regional
Trial Court which shall state that the owner’s or
co-owner’s duplicate certificate of title had been
lost or destroyed, if such be the fact, the location,
area and boundaries of the property, the names
and addresses of all persons who have a claim
or encumbrance on the property together with a
statement of their claims, and a statement that
no deeds or other instruments affecting the
property have been registered (R.A. 26, Sec.
12).
The notice of the petition must also be published
twice in successive issues in the Official
Gazette, posted on the main entrance of the
provincial and municipal building in which the
land is situated, and sent by registered mail or
otherwise to all persons named in the petition
(R.A. 26, Sec. 13).
Who shall file and where to file petition
The petition for judicial reconstitution shall be
filed by the registered owner, his assigns, or any
person having an interest in the property with the
 Regional Trial Court of the province or city where
the land lies (R.A. 26, Sec. 12).
Sources for Judicial Reconstitution of Title
The petition for judicial reconstitution must also
be supported by any of the following:
1. For OCT (in the following order):
(OCCADA)
a. Owner’s duplicate certificate of title;
b. Co-owner’s, mortgagee’s or lessee’s
duplicate of said certificate;
c. Certified copy of such certificate,
previously issued by the Register of
Deeds;
d. Authenticated copy of the decree of
registration or patent, as the case may
be, which was the basis of the
certificate of title;
e. Deed or mortgage, lease or
encumbrance containing description
of property covered by the certificate
of title and on file with the Registry of
Deeds, or an authenticated copy
thereof; and
f. Any other document, which, in the
judgment of the court, is sufficient and
proper basis for reconstitution (R.A.
26, Sec. 2).
2. For TCT:
a. Same as sources 1, 2, and 3 for
reconstitution of OCT;
b. Deed of transfer or other document
containing description of the property
covered by the transfer certificate of
title and on file with the Registry of
Deeds, or an authenticated copy
thereof; and
c. Same as sources 5 and 6 for
reconstitution of OCT (R.A. 26, Sec.
3).
3. For Liens and Encumbrances:
a. Annotations or memoranda appearing
on the owner’s, co-owner’s,
mortgagee’s or lessee’s duplicate;
b. Registered documents on file in the
registry of deeds, or authenticated
copies thereof showing that the
originals thereof had been registered;
and
c. Same as source 6 for reconstitution of
OCT (R.A 26, Sec. 4)
“Any other document” – refers to documents
similar to those previously enumerated therein, that
is, those mentioned in Sections (a) to (e) of RA No.
26 (Republic v. IAC and Kiram, G.R No. 68303,
January 15, 1998).
These are reliable documents of the kind described
in the preceding enumerations. The documents
must come from official sources which recognize the
ownership of the owner and his predecessors-in-
interest. Only if the petitioner for reconstitution fails
to show that he had, in fact, sought to secure such
documents and failed to find them, can the
presentation of “other document” as evidence in
substitution be allowed (Republic v. Catarroja, G.R.
No. 171774, February 12, 2010).
Publication, Mailing and Posting in Petitions for
Reconstitution of Title
Purpose of publication: To appraise the whole
world that such petition has been filed and that
whoever is minded to oppose it for good reasons or
causes may do so within thirty (30) days before the
date set for hearing. Since the requirement of
publication was not complied with, the order is not
valid for lack of jurisdiction (ALBANO, supra at 799).
Rules:
1. Notice thereof shall be published twice in
successive issues of the Official Gazette;
2. Must be posted on the main entrance of the
provincial building and of the municipal building
of the municipality or city where the land is
situated;
3. To be sent by registered mail to every person
named in said notice (R.A. 26, Sec. 9).
The requirements under R.A. No. 26 for
reconstitution are indispensable and must be
strictly complied with
The requirements under R.A. No. 26 are
indispensable and must be strictly complied with. In
a reconstitution proceeding, the petitioner is
burdened to adduce in evidence the documents in
the order stated in Section 3 of R.A. No. 26 as
sources of the deed to be reconstituted, and likewise
burdened to prove the execution or existence of the
original copy of the title, which is the copy on file with
the Registry of Deeds, and the contents thereof.
(Dela Paz v. Republic, G.R. No. 195726, November
20, 2017).
The above requirements are mandatory and
jurisdictional (Metropolitan Waterworks and
Sewerage System v. Sison, G.R. No. L-40309,
August 31, 1983). Non-compliance with the
prescribed procedure and requirements deprives the
trial court of jurisdiction over the subject matter or
nature of the case and, consequently, all its
proceedings are rendered null and void. The
rationale underlying this rule concerns the nature of
the conferment in the trial court of the authority to
undertake reconstitution proceedings. In all cases
where the authority to proceed is conferred by a
statute and the manner of obtaining jurisdiction is
mandatory, the same must be strictly complied with,
or the proceedings will be utterly void (Republic v.
Susi, G.R. No. 213209, January 16, 2017).
B. ADMINISTRATIVE RECONSTITUTION
– may be availed of only in case of:
a. Substantial loss or destruction of the original
land titles due to fire, flood, or other force
majeure as determined by the Administrator
of the Land Registration Authority;
b. The number of certificates of title lost or
damaged should be at least ten percent
(10%) of the total number in the possession
of the Office of the Register of Deeds;
c. In no case shall the number of certificates of
title lost or damaged be less than 500; and
d. Petitioner must have the duplicate copy of
the certificate of title (R.A. 6732, Sec. 1
amending Sec. 110 of P.D. 1529).
The law provides for retroactive application thereof
to cases fifteen (15) years immediately preceding
1989 (R.A. 6732, Sec. 14).
When the duplicate title of the landowner is lost, the
proper petition is not reconstitution of title, but one
filed with the court for issuance of new title in lieu of
the lost copy.
Reconstituted certificate is void if the original is not
really lost but only in the possession of another
person (Strait Times, Inc. represented by Rafael M.
Iriarte v. CA, G.R. No. 126673, August 28, 1998).
Sources for Administrative Reconstitution of
Title:
1. Owner’s duplicate certificate of title; and if
absent,
2. Co-owner’s, mortgagee’s, or lessee’s duplicate
of said certificate (NOBLEJAS, supra at 337-
338).
Requirements for administrative reconstitution:
1. No deed or other instrument affecting the
property has been presented for registration;
If there be any, the nature thereof, the date of its
presentation, the name of the parties, and
whether the registration of such deed or
instrument is still pending must be stated in the
petition.
2. Owner’s duplicate certificate or co-owner’s
duplicate is in due form without any apparent
intentional alteration or erasures;
3. The certificate of title is not subject of litigation
or investigation, judicial or administrative,
regarding its genuineness or due execution or
issuance;
4. The certificate of title was in full force and effect
at the time it was lost or destroyed;
5. The certificate of title is covered by a tax
declaration regularly issued by the Assessor’s
Office; and
6. Real estate taxes have been fully paid up to at
least two (2) years prior to the filing of the
petition (R.A. No. 26, Sec. 5, as amended by
R.A. 6732).
OTHER PETITIONS/
TRANSACTIONS AFTER
REGISTRATION
WHERE TO FILE PETITIONS OR
MOTIONS AFTER ORIGINAL
REGISTRATION
All petitions or motions after original registration shall
be filed and entitled in the original case in which the
decree of registration was entered (P.D. 1529, Sec.
108).
AMENDMENT AND ALTERATION OF
CERTIFICATE OF TITLE
GROUNDS FOR PETITION:
1. When registered interests of any description,
whether vested, contingent, or inchoate have
terminated and ceased;
2. When new interests have arisen or been created
which do not appear upon the certificate;
3. When any error, omission, or mistake was made
in entering a certificate or any memorandum
thereon or on any duplicate certificate;
4. When the name of any person on the certificate
has been changed;
5. When the registered owner has been married or
is registered as married, and the marriage has
terminated and no right or interest of heirs or
creditors will thereby be affected;
6. When a corporation, which owned registered
land and has been dissolved, has not conveyed
the same within three (3) years after its
dissolution; or
7. When there is a reasonable ground for the
amendment or alteration of title (P.D. 1529, Sec.
108).
NOTE: The court has no jurisdiction or authority to
reopen the judgment of registration or impair the title
or other interest of a purchaser holding a certificate
for value and in good faith, or his heirs and assigns,
without his or their written consent. After due
hearing, the court may only:
1. Order the entry or cancellation of a new
certificate;
2. Order the entry or cancellation of a
memorandum upon a certificate; or
3. Grant any other relief upon such terms and
conditions as it may consider proper (P.D. 1529,
Secs. 107 and 108).
GROUNDS FOR SURRENDER OF
WITHHELD DUPLICATE CERTIFICATE
OF TITLE:
1. When it is necessary to issue a new certificate
of title pursuant to any involuntary instrument
which divests the title of the registered owner
against his consent;
2. Where a voluntary instrument cannot be
registered by reason of the refusal or failure of
the holder to surrender the owner’s duplicate
certificate of title; and
3. Where the owner’s duplicate certificate is not
presented for amendment or alteration pursuant
to a court order (P.D. 1529, Sec. 107).
NOTE: A petition to surrender title may be filed as
an incident in an action affecting said title (Ligon v.
CA, G.R. No. 107751, June 1, 1995)
Proceedings under Section 108 of P.D. 1529
Pertaining to Amendment and Alteration of
Certificates is Not Applicable in Partition
Proceedings
Section 108 of P.D. 1529 is limited only to seven
instances or situations. As held in Philippine
Veterans Bank v. Valenzuela, the prevailing rule is
that proceedings under Section 108 of P.D. 1529 are
summary in nature, contemplating corrections or
insertions of mistakes which are only clerical but
certainly not controversial issues. Relief under said
legal provision can only be granted if there is
unanimity among the parties, or that there is no
adverse claim or serious objection on the part of any
party in interest. Here, petitioner cannot avail of the
summary proceedings under Section 108 of P.D.
1529 because the present controversy involves not
the amendment of the certificates of title issued in
favor of Rogelio and Orlando but the partition of the
estate of Maximino and Eligia who are both
deceased (Bagayas v. Bagayas, G.R. No. 187308,
September 18, 2013).
REPLACEMENT OF LOST DUPLICATE
CERTIFICATE OF TITLE
Due notice under oath shall be sent by the owner or
by someone in his behalf to the Register of Deeds of
the province of the city where the land lies as soon
as the loss or theft is discovered (P.D. 1529, Sec.
109).
Petition for replacement should be filed with the RTC
of the province or city where the land lies. This is true
even if the title was issued pursuant to a public land
patent registered in accordance with the law. (Office
of the Court Administrator v. Matas, A.M. No. RTJ-
92-836, August 2, 1995)
Notice to the Solicitor General by petitioner is not
imposed by law but it is the Register of Deeds who
should request for representation by the Solicitor
General (Republic v. CA, G.R. No. 128531, October
26, 1999).
A proceeding where the certificate of title was not in
fact lost or destroyed is null and void for lack of
jurisdiction and the newly issued duplicate is also
null and void (New Durawood Co., Inc. v. CA, G.R.
No. 111732, February 20, 1996).
GROUNDS FOR AMENDMENT OR
CORRECTION OF TITLE:
1. That an error or omission was made therein;
2. That a registered interest is terminated;
3. That new rights have arisen which do not appear
on the certificate (P.D. No. 1529, Sec. 108).
LAND PATENTS
PUBLIC LANDS SUITABLE FOR
AGRICULTURAL PURPOSES ARE
DISPOSED AS FOLLOWS:
1. Homestead settlement;
2. Sale;
3. Lease;
4. Confirmation of imperfect title or incomplete
titles
a. By judicial legalization; or
b. By administrative legalization (free patent);
and
5. Free title (R.A. 63).
TITLE INDEFEASIBLE
A certificate of title issued pursuant to a public land
patent partakes the nature of a certificate of title
issued through a judicial proceeding. It becomes
inconvertible upon the expiration of one year from
the date of the order for the issuance of the patent,
hence, prescription cannot operate against the
registered owner (Heirs of Simplicio Santiago v.
Heirs of Mariano Santiago, G.R No. 151440, June
17, 2003).
When a free patent title is issued to an applicant and
the seawater moves toward the estate of the
titleholder, the invaded property becomes part of the
foreshore land. The land under the Torrens system
reverts to the public domain and the title is annulled
(Republic v. CA, G.R. No. 100709, November 14,
STATUS OF LAND
1997).
APPLICANT OWNERSHIP
PATENTS DISTINGUISHED Special Patent
STATUS OF LAND
Non-Christian Filipinos Secretary of the DILG
APPLICANT OWNERSHIP
under Sec. 84 of the shall certify that the
Homestead Patent Public Land Act. majority of the non-
Christian inhabitants of
Any Filipino citizen over Does not own more any given reservation
the age of eighteen (18) than twenty-four (24) have advanced
years or head of a hectares of land in the sufficiently in
family. Philippines or has not civilization.
had the benefit of any
gratuitous allotment of
more than 24 hectares. Direct Sales

Filipino citizen of legal Not the owner of a

Must have resided
age. home lot in the
continuously for at least
municipality or city in
one (1) year in the
which he resides.
municipality where the
land is situated.
Have established in
good faith his residence
Must have cultivated at
on a parcel of public
least one-fifth (1/5) of
land which is NOT
the land applied for.
needed for public
service.
Free Patent
Have constructed his
Any-natural born citizen Does not own more house and actually
of the Philippines. than twelve (12) resided therein.
hectares of land.

Has continuously RESTRICTION ON

occupied and
cultivated, either by ALIENATION/ENCUMBRANCE OF
himself or his LANDS TITLED PURSUANT TO
predecessors-in- PATENTS:
interest tract/s of 1. The Public Land Act prohibits the alienation or
agricultural public land encumbrance of lands acquired under free
subject of disposition. patent or homestead patent, except in favor of
the Government or any of its branches, units, or
institutions, or legally constituted banking
Sales Patent corporations, from the date of the approval of the
application and for a term of five (5) years from
Citizens of the To have at least one-
and after the date of issuance of the patent or
Philippines of lawful age fifth (1/5) of the land
grant. (C.A. 141, Sec. 118).
or such citizens not of broken and cultivated
lawful age who is head within 5 years from the
of a family may date of the award. 2. Alienation, transfer or conveyance of any
purchase public homestead after five (5) years and before
twenty-five (25) years after issuance of title
agricultural land of not Shall have established
without the approval of the Secretary of DENR
more than twelve (12) actual occupancy,
(R.A. 10023, Sec. 9).
hectares. cultivation and
improvement of at least
1/5 of the land until the REASON: To preserve and keep in the family of
date of such final the public land grantee that portion of the public
domain which the State has gratuitously given to
payment.
him (Fontanilla, Sr. v. Fontanilla, G.R. No.
119341 November 29, 1999).

Prohibition is mandatory, violation of which
renders the conveyance null and void ab initio;
thus, it cannot acquire validity through the
passage of time.
3. Land covered by Free Patent – may not be sold
within five (5) years from the issuance of the
patent.
LANDS GRANTED UNDER HOMESTEAD
PATENT ARE EXEMPT FROM THE
COVERAGE OF THE CARL
Lands granted under homestead patents are exempt
from the coverage of the CARL. In order for the
homestead grantees or their direct compulsory heirs
to retain or keep their homestead, the following
conditions must first be satisfied:
(a) They must still be the owners of the original
homestead at the time of the CARL's effectivity;
and
(b) They must continue to cultivate the homestead
land. (Almero, et. Al v. Heirs of Pacquing, G.R.
No. 199008, November 19, 2014).
Property Sold During the Prohibited Period May
Be Recovered from The Vendee
Jurisprudence supports the return of lands sold
pursuant to the declaration of a void sale for being in
violation of Sec. 118 of the Public Land Act. Because
the subject of the transaction is a piece of public
land, public policy requires that an heir should not be
prevented from re-acquiring it because it was given
by law to his family for their home and cultivation.
This is the policy on which the homestead law is
predicated (Binayug v. Ugaddan, G.R No. 181623,
December 5, 2012).
ACTIONS AGAINST IMPROPER,
ILLEGAL ISSUANCE OF PATENTS:
(RCR)
1. Reversion Suits
The objective is the cancellation of the certificate
of title and the consequential reversion of the
land covered thereby to the State (Vicente
Cawis v. Antonio, G.R. No. 170207, April 19,
2010).
All actions for the reversion to the Government
of lands of the public domain or improvements
thereon shall be instituted by the Solicitor
General or the officer acting in his stead, in the
name of the Republic of the Philippines (Public
Land Act, Sec. 101).
A private party may not bring an action for
reversion or any action which would have the
effect of cancelling a public land patent and the
corresponding certificate of title, with the result
that the land covered thereby will again form part
of the public domain (Sumail v. Judge of the CFI
of Cotabato, G.R No. L-8278, April 30, 1955;
Narcise v. Valbuelco Inc., G.R. No. 196888, July
19, 2017).
Grounds for Reversion:
a. Violation of Secs. 118, 120-122 of the Public
Land Act (e.g. Alienation or sale of
homestead executed within the 5-year
prohibitory period);
b. When land patented and titled is not capable
of registration;
c. Failure of the grantee to comply with the
conditions imposed by law to entitle him to a
patent or grant;
d. When area is an expanded area (Republic
v. Heir of Villa Abrille, G.R. No. L-39248,
May 7, 1976); or
e. When the land is acquired in violation of the
Constitution (e.g. Land acquired by an alien
may be reverted to the State);
f. Grant of patent was made through mistake
or oversight (Republic v. Amor Hachero,
G.R. No. 200973, May 30, 2016).
NOTE: Indefeasibility of title, prescription,
laches and estoppel do not bar reversion suits.
Declaration of Nullity of Free Patents/
Certificates of Title v. Action for Reversion
The difference between them lies in the
allegations as to the character of ownership of
the realty whose title is sought to be nullified. In
an action for reversion, the pertinent allegations
in the complaint would admit ownership of the
State of the disputed land. On the other hand, a
cause of action for declaration of nullity of free
patent and certificate of title would require
allegations of the plaintiff’s ownership of the
contested lot prior to the issuance of such free
patent and certificate of title as well as the
defendant’s fraud or mistake, as the case may
be, in successfully obtaining these documents of
title over the parcel of land claimed by plaintiff
(Baguilan v. CA, G.R. No. 165815, April 27,
2007).
2. Cancellation of Certificate of Title
It is proper for a private party to file an action for
cancellation of certificate of title issued by virtue
of a public land patent as when he claims
ownership of the land as private property by
virtue of long period of possession.
If the land covered by a free patent was a private
land, the Director of Lands has no jurisdiction
over it. Such free patent and the subsequent
certificate of title issued pursuant thereto is a
nullity. The aggrieved party may initiate an
 action for cancellation of such title (Pabaus v. 2. Coverage
Yutiamco, G.R No. 164356, July 27, 2011). Lands that have been zoned as residential
areas, including townsites, those located inside
3. Action for Reconveyance delisted military reservations or abandoned
GENERAL RULE: Reconveyance is not a military camps, and those of local government
proper remedy in case the subject property is units or townsites which preceded R.A. 7586 or
public land. It is because a private person would the National Integrated Protected Areas System
have no right to recover the property. It would Law (R.A. 10023, Sec. 2).
simply revert to the public domain.
3. Special Patents
EXCEPTION: When a free patent was issued Aside from private residential lands, public lands
over private lands that are beyond the actually occupied and used for public schools,
jurisdiction of the Director of Lands/DENR to municipal halls, public plazas or parks and other
dispose of (De Leon v. De Leon-Reyes, G.R. No. government institutions for public use or
205711, May 30, 2016). purpose may also be issued special patents
under this law in the name of the national agency
RESIDENTIAL FREE PATENTS or LGU concerned, and all such public lands so
titled shall not be disposed of unless sanctioned
R.A. 10023 entitled “An Act Authorizing the Issuance
by Congress, if owned by an agency of the
of Free Patents to Residential Lands” was approved
national government, or sanctioned by the
on March 9, 2010 and became effective on April 3,
sanggunian concerned through an approved
2010.
ordinance, if owned by the LGU (R.A. 10023,
Sec. 4).
DENR Administrative Order (DAO) No. 2010-25,
approved on October 4, 2010, however amended
4. Application
Section 3 of DAO 2010-12 otherwise known as
a. Filed with the Community Environment and
“Rules and Regulations for the Issuance of Free
Natural Resources Office (CENRO) of the
Patents to Residential Lands under R.A. 10023.”
DENR immediately after the effectivity of the
Act
It especially provides that:
b. Supported by a map based on actual survey
“3.2 Actual occupation, actual residence and
conducted by a geodetic engineer approved
continuous possession and occupation of the parcel
by the DENR.
subject of the application, either by herself or himself
c. Supported by the affidavit of two (2)
or through her or his predecessor-in-interest, under
disinterested persons, who are residents of
a bona fide claim of acquisition of ownership, for at
the barangay of the city or municipality
least ten (10) years prior to the filing of the
where the land is located, attesting to the
application.”
occupation of the applicant (or
predecessors-in-interest) on the said land
The salient provisions are as follows:
(R.A. 10023, Sec. 3).
1. Qualifications (FLN)
a. Any Filipino Citizen who is an actual
5. Action on the Application
occupant of a residential land for at least ten
The CENRO is mandated to process the
(10) years.
application within one hundred and twenty (120)
days to include compliance with the required
This substantially reduced the previous
notices and other legal requirements, and
requirement of thirty (30) years of open and
forward this recommendation to the Provincial
continuous possession of land under C.A.
Environment and Natural Resources Office
141, as amended, or the Public Land Act
(PENRO), who shall have five (5) days to
and thus expedited the titling process.
approve or disapprove the patent.
b. Land applied for is not needed for public
In case of approval, a patent shall be issued; in
service or public use.
case of conflicting claims among different
c. The land should Not exceed:
claimants, the parties may seek the proper
i. In highly urbanized cities – 200sq.m
judicial remedies (R.A. 10023, Sec. 6).
ii. In other cities – 500sq.m
iii. 1st and 2nd class municipalities –
6. Removal of Restrictions
750sq.m
The restrictions regarding encumbrances,
iv. In all other municipalities – 1,000sq.m
conveyances, transfers or dispositions imposed
(R.A. 10023, Sec. 1)
in Secs. 118, 119,121, 122 and 123 of Chapter
 XII, Title VI of C.A. 141 as amended, shall not
apply to patents issued (R.A. 10023, Sec. 5).

AGRICULTURAL FREE PATENTS

R.A. 11231 entitled “An Act Removing the
Restrictions Imposed on the Registration,
Acquisition, Encumbrance, Alienation, Transfer and
Conveyance of Land Covered by Free Patents
Under Sections 118, 119 and 121 of Commonwealth
Act No. 141, Otherwise Known as "The Public Land
Act", as Amended” was approved on February 22,
2019.

Non-applicability of restrictions under Secs. 118,

119 and 121 of C.A. 141
Agricultural public lands alienated or disposed in
favor of qualified public land applicants under
Section 44 of Commonwealth Act No. 141, as
amended, shall not be subject to restrictions
imposed under Sections 118, 119 and 121 thereof
regarding acquisitions, encumbrances,
conveyances, transfers, or dispositions (R.A. 11231,
Sec. 3).

Agricultural free patent shall now be considered as

title in fee simple and shall not be subject to any
restriction on encumbrance or alienation (R.A.
11231, Sec. 3).

Retroactive effect of R.A. 10023 on agricultural

free patents issued before the effectivity of R.A.
10023
Sec. 4 provides that the law “have retroactive effect
and any restriction regarding acquisitions,
encumbrances, conveyances, transfers, or
dispositions imposed on agricultural free patents
issued under Section 44 of Commonwealth Act No.
141, as amended, before the effectivity of this Act
shall be removed and are hereby immediately lifted:
Provided, That nothing in this Act shall affect the
right of redemption under Section 119 of
Commonwealth Act No. 141, as amended, for
transactions made in good faith prior to the effectivity
of this Act.”

NOTE: (SEE DISCUSSIONS ON CONCEPT AND

REGISTRATION ON AGRARIAN TITLES IN
LABOR LAW MEMORY AID).