LEGAL TITLE TO PROPERTY

PURCHASED TAKEN IN ONE

CO-OWNER
Where property is purchased by two or more persons and
by common consent the legal title is placed in the name of
only one of the co-owners for the benefit of all, a trust
arises by implication of law in favor of the others in
proportion to the interest of each.

Prepared by: Jeremiah Joy Quilang

CC ARTICLE 1453

 When property is conveyed to a person in reliance

upon his declared intention to hold it for, or
transfer it to another or the grantor, there is an
implied trust in favor of the person whose benefit
is contemplated.

Prepared by: Jeremiah Joy Quilang

CC ARTICLE 1454.

 If an absolute conveyance of property is made in order to

secure the performance of an obligation of the grantor
toward the grantee, a trust by virtue of law is established.
If the fulfillment of the obligation is offered by the grantor
when it becomes due, he may demand the reconveyance of
the property to him.

Prepared by: Jeremiah Joy Quilang

Notes:

 Resulting trusts arise from the nature or circumstances of the

consideration involved in a transaction whereby one person
becomes invested with legal title but is obligated in equity to hold
his title for the benefit of another.66 It is founded on the equitable
doctrine that valuable consideration and not legal titleis
determinative of equitable title or interest and is always presumed to
have been contemplated by the parties.67 Since the intent is not
expressed in the instrument or deed of conveyance, it is to be found
in the nature of the parties' transaction.

Prepared by: Jeremiah Joy Quilang

Notes

 Upon offering to the grantee the fulfillment of the obligation, the

grantor is entitled to a deed of reconveyance of the property so long
as the rights of innocent third parties have not intervened.
 No implied trust in simulated transfers. ( Clemente vs CA)
A PURCHASE OF PROPERTY WITH USE
OF TRUST FUNDS

 A purchase by a trustee, guardian or other person holding a fiduciary

relationship of property, where he takes the conveyance in his own or third
person’s name, using trust funds for the purchase, establishes a resulting
trust for the benefit of the person to whom the funds belong.

 Thus, an agent is bound to return to the principal the property acquired

with the funds and at the instance of the principal. He holds the property in
trust for his employer or principal who can bring an action to compel a
conveyance to him subject to the rights of an innocent purchaser for value.

Prepared by: Jeremiah Joy Quilang

Note:

 A constructive trust arises on a purchase with the

use of trust funds where there is fraud or breach of
confidence.
 Prescription for action of reconveyance: 10 years
from registration or issuance of title.

Prepared by: Jeremiah Joy Quilang