ARTICLE 1604.

1602 also applicable to contract purporting to be an

absolute sale PACTO DE RETRO SALE MORTGAGE Ownership is
consolidated in the vendee if failure of mortgagor to pay his obligations
on Art.... confirmation of the sale by the court. Vendee may alienate
property Mortgagee cannot alienate property Art.

(1)Doubt resolved in favor of equitable mortgage- equitable mortgage

is favored by law . Whether the sale is absolute or pacto de retro, it shall
pressumed to be an equitable mortgage if any of cases mentioned in
Article 1602 is present. In case of doubt a contract purpoting to be a
sale with right to repurchase shall still be regarded as an equitable
mortgage.

(2)Presumption, an exception to general rule- Article 1603 is an

exception to the rule that doubts affecting an onerous contract shall be
settled in favor of greatest reciprocity of interest.
ARTICLE 1605 . In the cases referred to in Articles 1602 & 1604, the
apparent vendor may ask for the reformation of the instrument.

Reformation is the remedy in equity by means of which a written

instrument is made or construed so as to express or conform to the real
intention of parties when such intention is not expressed in the instrument
.

ARTICLE 1606 . The right referred to in Article 1601, in the absence of

an express agreement, shall last four years from the date of the contract.
... *If there is an agreement: period agreed upon cannot exceed 10 years
and in the absence of the period, 4 years from the date of the contract.

PERIOD TO EXERCISE OF RIGHT OF REDEMPTION

(1) No agreement/granting right
(2) Agreement merely grant rights
(3) Definite period of redemption agreed upon
(4) Period of redemption agreed upon not specified
(5) Period agreed upon exceeds ten years
(6) Final judgement rendered that contract pacto de retro
ARTICLE 1607- In case of real property, the consolidation of ownership
in the vendee by virtue of the failure of the vendor to comply with the
provisions of article 1616 shall not be recorded in Registry of Property
without a judicial order, after the vendor has been duly heard.

ARTICLE 1608- The vendor may bring his action against every
possessor whose right is derived from the vendee, even if the second
contract does not mention of the right to repurchase, without prejudice to
provisions of mortgage law and the Land Registration law with respect to
third person.