Académique Documents
Professionnel Documents
Culture Documents
COLLEGE OF LAW
CIVIL LAW
Arianne Reyes
Academics Head
Henry Aguda
Ryan Balisacan
Subject Committee
Information Management
Committee
CIVIL LAW
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Civil Personality
Citizenship and Domicile
Marriage
Void Marriages
Voidable Marriages
Legal Separation
Rights and Obligations Between Husband and Wife
Property Relations Between Spouses
The Family
Paternity and Filiation
Adoption
Support
Parental Authority
Funerals
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CIVIL LAW
I. CIVIL PERSONALITY
A. CONCEPT AND CLASSES OF PERSONS
Person - any being, natural (Art. 40, CC) or
juridical (Art. 42, CC), susceptible to legal
rights and obligations, and can be a subject of
legal relations.
Kinds of Capacity: (Art. 37, CC)
Juridical Capacity
Capacity to Act
Power to do acts
with legal effect
Acquired
and
may be lost
Subject
to
certain
restrictions
Conditional and
variable, it is
acquired
and
may be lost.
Effect of Death:
The effect of death upon the rights and
obligations of the deceased is determined by
law, by contract and by will (Art 42, par. 2).
Doubt as to the order of death:
If they are called to succeed each other,
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 will be no transmission
of rights from one to the other. (Art. 43, CC)
Joaquin v. Navarro
93 Phil 257 (1953)
The rule on Art. 43 was not applied in
determining whether the mother or the son
died first. There were eyewitnesses who can
give evidence as to who died first. It is only
applied when it is impossible to determine
who died first that the presumption applies.
2. Juridical persons
Kinds of juridical persons: (Art. 44, CC)
Kinds of persons:
1. Natural persons
General Rule:
Birth determines personality (Art 40). Death
extinguishes civil personality (Art 42).
Exception:
A conceived child is considered born for all
purposes that are FAVORABLE to it, provided
it be born later (Art 40, 2nd clause) with the
following circumstances:
Governing laws:
Juridical Person
State
Political
subdivision
Public corporation
Private corporation
Partnerships
Burden of proof:
The presumption is that it was alive and the
burden of proof is on the party who alleges
the contrary.
Geluz v. CA
G.R. No. 16439 (1961)
An unborn fetus is not endowed with
personality.
Parents of an unborn fetus
cannot sue for damages on its behalf as the
fetus, having no personality, does not have
rights which it can pass on.
The family,
however, can recover moral damages.
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Governing law
Constitution
Charter
Charter
Corporation
Code,
Articles
of
Incorporation and ByLaws
Stipulations
of
the
parties
and
suppletorily by the
general provisions on
partnership
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Effect on Marriage:
- Marriage contracted by any minor is
VOID.
Presumption of Capacity:
Standard Oil Co. v. Arenas
19 Phil 363 (1911)
To prove insanity, it has to be proven that:
(1) The monomania of wealth was habitual
and that it contributed to mental perturbation;
(2) that the act was caused by the
monomania itself; (3) that the monomania
existed at the moment he signed the surety.
Capacity to act is presumed unless previously
declared incapable by the court.
Effect on Crimes:
- 9 years and below= EXEMPT from
criminal liability. (Art. 12, RPC)
- Over 9 years and under 15 = EXEMPT,
(Art. 12, RPC)
- Unless
he
acted
with
discernment
=
Penalty
is
lowered by at least 2 degrees.
(Art. 68, RPC)
- 15 years and below 18 = MITIGATING
circumstance. (Art. 13, RPC)
Restrictions/limitations on capacity to
act: (Art. 38, 39, CC,)
2. Insanity
1.
2.
3.
4.
5.
6.
7.
8.
9.
Effect on Contracts:
- Insane persons cannot give consent to a
contract. (Art. 1327, CC)
- Contracts entered into during a lucid
interval are valid. (Art. 1328, CC)
- The incapacitated person is not obliged
to make any restitution except insofar as
he has been benefited. (Art. 1399, CC)
Minority
Insanity or imbecility
State of being deaf-mute
Prodigality
Civil interdiction
Family relations
Alienage
Absence
Married women (Art. 2259, CC)
Effect on Crimes:
- Insane persons are EXEMPT from
criminal liability unless they acted during
a lucid interval. (Art. 12, RPC)
1. Minority
RA 6809 Majority commences at the age of
18 years.
Effect on Contracts:
- Minors cannot give consent to a
contract. (Art. 1327, CC).
- The parents consent is binding on the
minor. (Shields v. Gross, 58 NY 2d 338)
- If one of the parties to a contract is a
minor, the contract is voidable. (Art.
1390, CC)
- If both parties are minors, the contract
is unenforceable. (Art. 1403, CC)
- Persons who are capable cannot allege
the incapacity of the other party. (Art.
1379, CC)
- The minor is not obliged to make
restitution except insofar as he has been
benefited. (Art. 1399, CC)
- If there is active representation by the
minors that they are of legal age, the
contract is valid. (Mercado v. Espiritu, 37
Phil. 215)
- If there is only passive representation,
the contract is not valid. The fraud must
be actual and not constructive. Mere
silence does not constitute fraud.
However, the minors must make
restitution to the extent they profited
from the money received. (Braganza v.
de Villa Abrille, 105 Phil. 456)
Effect on Marriage:
- A marriage is VOIDABLE if either party
was of unsound mind at the time of the
marriage.
- Except: When the insane person, after
coming to reason, freely cohabited with
the other.
Dumaguin v. Reynolds
10 Phil. 381 (1952)
The presumption of mental incapacity in a
person under guardianship for mental
derangement may be rebutted by evidence.
That person may enter a valid contract
provided it is proven
1. That he was not insane at the time he
entered into the contract, and
2. That his mental defect did not affect
his capacity to appreciate the meaning
and significance of the transaction.
3. State of being deaf-mute
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CIVIL LAW
8. Absence
4. Prodigality
Martinez v. Martinez
1 Phil. 182
To make a person legally unfit to run his own
affairs, his acts of prodigality must show:
1. A morbid mind, and
2. A tendency to spend or waste the
estate so as to expose the family to
want or deprive the forced heirs of
their inheritance.
5. Civil Interdiction
Civil interdiction deprives the offender during
the time of his sentence of the following
rights (PA-G-MA-MD)
1. Parental authority,
2. Guardianship as to the person or
property of any ward,
3. Marital authority,
4. Management his property
5. Disposition of his property (Art. 34,
RPC)
General Rule:
Absence of 7 years + unknown whether the
absentee still leaves = presumed dead for all
purposes.
Except:
For the purpose of opening his succession, in
which case, the absentee is presumed dead
after 10 years. If disappeared after the age
of 75 years, 5 years will be sufficient. (Art.
390, CC)
Rule:
The following are presumed dead for ALL
purposes, including the division of estate
among the heirs: (VA-A-D)
1. A person on board a vessel 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;
2. A person in the armed forces who has
taken part in war, and has been
missing for 4 years;
3. A person who has been in danger of
death under other circumstances and
existence has not been known for 4
years. (Art. 391, CC)
6. Family Relations
Effect on Crimes:
- No criminal liability if one acts in defense
of spouse, ascendants, descendants,
brothers or sisters, relatives by affinity
and consanguinity within the 4th civil
degree provided the requisites in Art. 11
and 12 of RPC are followed.
- Mitigating circumstance: If one acts in
immediate vindication of a grave offense
committed
against
his
spouse,
ascendants, or relatives by affinity
within the same degrees. (Art. 13, RPC)
Administration
and
enjoyment
of
conjugal partnership where one spouse is
absent:
-
Effect on Marriage:
- Incestuous and void Marriages
between ascendants and descendants;
between brothers and sisters, whether
full or half blood. (Art. 37, FC)
Effect on Prescription:
- Prescription does not run between
husband and wife. (Art. 1109, CC)
Effect on Property Relations:
- Husband and wife cannot sell property to
each other except:
- When separation of property
was agreed in the marriage
settlements;
- When there has been a judicial
separation of property. (Art.
1490, CC)
7. Alienage
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9. Married Women
General Rule:
A married woman may not sue or be sued
alone without joining her husband.
Except: (Rule 3, Sec. 4, ROC)
1. When they are judicially separated.
2. If they have in fact been separated for
at least 1 year;
3. When there is a separation of property
agreed
upon
in
the
marriage
settlements;
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CIVIL LAW
III. MARRIAGE
A. DEFINITION
MARRIAGE
AND
NATURE
OF
Definition of Marriage:
1. A special contract
2. of permanent union
3. between a man and a woman
4. entered into in accordance with law
5. for the establishment of conjugal and
family life.
6. It is the foundation of the family and
7. an inviolable social institution
8. whose
nature,
consequences,
and
incidents are governed by law and not
subject to stipulation,
9. except that marriage settlements may fix
the property relations during the marriage
within the limits provided by this Code.
(Art. 1, FC)
Breach of promise to marry:
Tanjanco v. CA
18 SCRA 994
Breach of promise to marry is not an
actionable wrong. The fact that the woman
agreed to have sexual intercourse for a year
does not constitute seduction but mutual
passion.
Kinds of Domicile:
Wassmer v. Velez
12 SCRA 648
1. Domicile of Origin
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CIVIL LAW
Essential
Formal
Absence
Void*
Void*
Defect
Voidable
Irregularity
No effect on
validity but
party
responsible
will be
liable.
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3. Marriages
by
Muslims
and
cultural
minorities. (Art. 33, FC)
4. Marriage by parties with who have
cohabited for at least 5 years. (Art. 34,
FC)
Ninal v Badayog
GR 133778 (2000)
There must be no legal impediment during the
entire five or more years that the parties are
living as husband and wife.
Things to do at the local civil registrar:
a) File an application of marriage license
at the proper local civil registrar. (Art.
11, FC)
b) Present birth or baptismal certificate.
(Art. 12, FC)
c) If aged 18-21 years, present parental
consent. (Art. 14, FC)
d) If aged 21-25, present parental
advice. (Art. 15, FC)
e) If aged 18-25, present certificate of
marriage counseling from your priest.
(PD 965)
f) Pay the required fees. (Art 19, FC)
g) If foreigner, present certificate of
legal capacity issued by diplomat or
consular officials. (Art. 21, FC)
c. Marriage Ceremony
There is no particular form or religious rite
required by law. (Art. 6, FC)
Minimum requirements by law:
1. The contracting parties appear personally
before the solemnizing officer
2. They declare in the presence of at least
two witnesses of legal age,
3. That they take each other as husband and
wife
4. The declaration shall be contained in the
marriage certificate,
5. Which shall be signed by the contracting
parties and their witnesses and attested
by the solemnizing officer. (Art. 6, FC)
Note: In a marriage in articulo mortis, when
one or both parties are unable to sign the
marriage certificate, it shall be sufficient for
one of the witnesses to write the name of said
party, which shall be attested by the
solemnizing officer. (Art 6, par. 2)
Places
where
marriage
celebrated (CCO): (Art. 8, FC)
may
be
General Rule:
1. Chambers of the judge or in open court;
2. Church, chapel, or temple
3. Office of the Consul-general, consul, or
vice-consul, as the case may be.
Exceptions:
1. Marriage in articulo mortis;
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CIVIL LAW
i. Judgment of annulment or
of
absolute
nullity
of
marriage;
ii. Partition and distribution of
the
properties
of
the
spouses
iii. Delivery
of
presumptive
legitimes of the children.
b. Under Art. 36
7. Psychological incapacity of any contracting
party, at the time of the celebration of the
marriage, to comply with the essential
marital obligations.
c. Under Art. 37
(Incestuous Relationships)
8. Between ascendants and descendants of
any degree, legitimate or illegitimate.
9. Between brothers and sisters, whether full
or half-blood, legitimate or illegitimate.
d. Under Art. 38
(For Reasons of Public Policy)
10. Between
collateral
blood
relatives,
legitimate or illegitimate, up to the fourth
civil degree.
11. Between step-parents and step-children.
12. Between parents-in-law and children-inlaw.
13. Between adopting parent and adopted
child.
14. Between the surviving spouse of the
adopting parent and the adopted child.
15. Between the surviving spouse of the
adopted child and the adopter.
16. Between an adopted child and a legitimate
child of the adopter.
17. Between adopted children of the same
adopter.
18. Between parties where one, with the
intention to marry the other, killed that
other person's spouse, or his or her own
spouse.
The following CAN marry each other:
1. Brother-in-law and sister-in-law
2. Stepbrother and stepsister
3. Guardian and ward
4. Adopted child and illegitimate child of
the adopted
e. Under Art. 44
Subsequent marriage contracted under Art. 41
and both parties are in bad faith.
Declaration of nullity of marriage
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Terre v. Terre
211 SCRA 6
Parties are not allowed to assume that their
marriage is void even if such is the fact. They
must file an action for declaration of nullity
under Art. 40 before they remarry.
Atienza v. Brillantes
243 SCRA 32
Art. 40 is applicable to remarriages entered
into after the effectivity of the Family Code,
regardless of the date of the first marriage.
The Family Code retroacts to the extent that it
does not impair rights.
Domingo v. CA
226 SCRA 572 (1993)
A marriage void for lack of marriage license
still needs a judicial declaration of such fact
even for a purpose OTHER than remarriage
(e.g. liquidation, partition, distribution and
separation of property between spouses,
custody and support of children, and delivery
of the latters presumptive legitime). Art. 40
not mean that JDN can only be invoked for
purposes of remarriage.
PSYCHOLOGICAL INCAPACITY
(Art. 36, FC)
Chi Ming Tsoi v. CA
266 SCRA 234 (1997)
Psychological
incapacity
involves
the
senseless, constant, and prolonged refusal to
comply with the essential marital obligations.
Procreation is one of the essential marital
obligations under the Family Code. The
prolonged refusal of a spouse to have sex with
his spouse, even though capable, is equivalent
to psychological incapacity.
Santos v. CA
G.R. 112109 (1995)
Psychological incapacity under Art. 36, FC is
not meant to comprehend all possible cases of
psychoses. It should refer, rather, to no less
than a mental (not 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.
Psychological
incapacity must be characterized by (a)
gravity, (b) juridical antecedence, and (c)
incurability.
Carating-Siayngco v. Siayngco
G.R. No. 158896 (2004)
Sexual infidelity, per se, does not constitute
psychological incapacity. It must be shown
that
respondents
unfaithfulness
is
a
manifestation of a disordered personality
which makes him completely unable to
discharge the essential obligations of the
marital state and not merely due to his ardent
wish to have a child of his own flesh and
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CIVIL LAW
blood.
Mere
showing
of
irreconcilable
differences and conflicting personalities does
not constitute psychological incapacity.
Republic v. Quintero-Hamano
G.R. No. 149498 (2004)
In proving psychological incapacity, there
should be no distinction between an alien
spouse and a Filipino spouse. We cannot be
lenient in the application of the rules merely
because
the
spouse
alleged
to
be
psychologically incapacitated happens to be a
foreign national. The medical and clinical rules
to determine psychological incapacity were
formulated on the basis of studies of human
behavior in general.
Republic v. Molina
268 SCRA 198 (1997),
Guidelines for the interpretation of Art. 36:
1. The burden of proof to show the nullity of
the marriage belongs to the plaintiff.
2. The root cause of the psychological
incapacity must be:
3.
4.
5.
6.
7.
8.
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CIVIL LAW
VOIDABLE
bigamous marriage
Contracted by spouse
present
upon
the
presumption of death
of first spouse
Good
faith
of
remarrying party
is immaterial; if in
bad
faith,
he
becomes liable for
bigamy
General Rule:
Marriage contracted by any person during the
subsistence of a previous marriage is VOID.
Good faith is immaterial here.
Exception:
If before the celebration of the subsequent
marriage
1. The first spouse has been absent for
four consecutive years, or two years
under extraordinary circumstances,
and
2. The surviving spouse has a wellfounded belief that the spouse is dead,
and
3. There is a judicial declaration of
presumptive death, without prejudice
to the effect of the reappearance of the
absent spouse.
Note: This is a
VOIDABLE bigamous marriage.
Exception to the exception:
When both parties in the subsequent marriage
acted in bad faith, the marriage is still void
(Art. 44, FC).
People v. Mendoza
95 Phil. 845 (1954)
Mendoza contracted three marriages. He
contracted the second marriage during the
subsistence of the first marriage. He
contracted the third marriage after the death
of his first wife. He was prosecuted for bigamy
on his third marriage. The Supreme Court
held that he is not guilty for bigamy for his
third marriage, since his prior subsisting
marriage has already been extinguished by
the death of his first wife. It is the second
marriage that is bigamous.
Morigo v. People
G.R. No. 145226 (2004)
General Rule: Even if the first marriage is
judicially declared void only after contracting
the second marriage, the second marriage is
still bigamous.
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B. EFFECTS OF NULLITY
(ChiPCuPCDRDIDS) (Arts. 50-54, 43-44)
1. Children considered illegitimate
2. Property Regime is dissolved liquidation,
partition and distribution of the properties
of the spouses. If either spouse acted in
bad faith, his/her share in the net profits
will be forfeited:
a. In favor of the common children
b. If none, in favor of the guilty
spouse by previous marriage
c. If none, in favor of the children of
the innocent spouse.
3. Custody and support of the common
children will be decided
4. Presumptive legitimes must be delivered
5. Creditors of the spouses and of the
absolute
community
or
conjugal
partnership must be notified of the
proceedings of liquidation.
6. Conjugal dwelling given to the spouse
with whom majority of the children choose
to remain.
7. Parties can remarry after compliance
with Art. 52, FC.
8. Donation propter nuptias remains valid,
(but if the donee contracted marriage in
bad faith, donations will be revoked)
9. Insurance benefits innocent spouse may
revoke designation of guilty party as
beneficiary, even if such designation is
irrevocable
10. Donations - If both parties of subsequent
marriage acted in bad faith, any donations
and testamentary dispositions made by
one party to the other by reason of
marriage will be revoked
11. Succession Rights Party in bad faith
disqualified to inherit from innocent
spouse, whether testate or intestate
Note: Except for #1, the above also effects
apply to marriages which are annulled (and to
voidable bigamous marriages.)
V. VOIDABLE MARRIAGES
A. GROUNDS (CIF-mspd-FIS) (Art. 45, FC)
1. One of the parties is 18 or above but
below 21, and there is no parental
consent.
2. Either party was of unsound mind
(insanity).
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Insanity
for
Art. 46 STD
The STD is a type of
fraud
which
is
a
ground for annulment
Must be concealed
Who can
file
(Art. 47)
1.
Underage
party
Prescription
(Art. 47)
1. 5
years
after
attaining
21.
2. Parent
or
guardian
2. Before
child
reaches
21.
1. Sane
spouse
with no
knowledge
of the
others
insanity
2. Legal
guardian
of insane
party
3. Insane
party
1. Any
time
before
the death
of insane
party
Buccat v Buccat
72 Phil. 19
It held that it is unbelievable that the wife
could have concealed the fact that she was 6
months pregnant at the time of the marriage.
Annulment not granted.
Aquino v Delizo
109 Phil. 21
The Supreme Court granted annulment
because the wife concealed the fact that she
was 4 months pregnant during the time of the
marriage. It argued that since Delizo was
Fraud
Injured
party
(defrauded party)
Force,
intimida
tion,
undue
influence
Injured
party
2. During
lucid
interval
or after
regaining
sanity,
and
before
death
Five
years
after
discovery
of fraud
Five
years
after
disappea
-rance of
force or
intimidation
Ratification
(Art. 45)
Free
cohabitation after
attaining
age of
21.
Free
cohabitation of
insane
party
after
coming
to reason
Free
cohabitation after
having
full
knowledge of
fraud
Free
cohabitation after
the force
has
ceased
or
disappered
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STD
Who can
file
(Art. 47)
Healthy
party
Prescripti
on
(Art. 47)
Five
years
after
marriage
Healthy
party
Five
years
after
marriage
CIVIL LAW
Ratificati
on
(Art. 45)
Deemed
ratified
when
action
prescribes
Deemed
ratified
when
action
prescribes
C. EFFECTS OF PENDING
ACTIONS/DECREE (Art. 49, FC)
1. The court shall provide for the support
of the spouses,
2. The custody of the common children,
giving paramount consideration to their
moral and material welfare, their
choice of parent with whom they wish
to remain.
3. The court shall also provide for
visitation rights of other parent.
No child under 7 years shall be separated
from the mother unless there is a compelling
reason to do so.
To prevent collusion between the parties,
fabrication or suppression of evidence, the
prosecuting attorney or fiscal shall appear on
behalf of the State. (Art. 48, FC)
D. VOID MARRIAGES vs.
VOIDABLE MARRIAGES
Void Marriage
Nature
Covalidatio
n
INEXISTENT
from
the
beginning
CANNOT
be
covalidated
Effect on
property
No Community
Property, only
Co-ownership
Legitimacy of
children
General
rule:
Children
are
ILLEGITIMATE
(Art. 165)
Exception:
In
void
marriages
by reason of
psychologica
l incapacity
(Art. 36) or
non-partition
of properties
in a previous
marriage
(Art.
53),
children are
considered
LEGITIMATE
.
Republic v. Bermudez-Lorino
G.R. No. 160258 (2005)
The RTC rendered a decision declaring the
presumptive death of respondents absent
spouse based on Art. 41, FC. The Republic
appealed the decision to the CA. Applying
Art. 247 FC, the SC ruled that the CA did not
have jurisdiction over the appeal because
summary proceedings are immediately final
and executory, and therefore unappealable.
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Voidable
Marriage
VALID
until
annulled
by
court
CAN
be
covalidated by
prescription or
free
cohabitation
ACP
exists
unless another
system
is
instituted
through
marriage
settlement
Children
are
LEGITIMATE if
conceived
before decree
of annulment
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Effect of
death of
parties
May
be
attacked
DIRECTLY
or
COLLATERALLY
, except for
purpose
of
remarriage
(there must be
JDN)
May still be
impugned after
death
of
parties
CIVIL LAW
Voidable
Marriage
Can only be
attacked
DIRECTLY
(there must be
annulment
decree)
Can no longer
be impugned
after death of
parties
E. JURISDICTION
Tamano v. Ortiz
291 SCRA 584 (1998)
PD No. 1083 (Code of Muslim Personal Laws
of the Philippines) does not provide for a
situation where the parties were married both
in civil and Muslim rites. Consequently, the
shari'a courts are not vested with original and
exclusive jurisdiction when it comes to
marriages celebrated under both civil and
Muslim laws. Hence, the Regional Trial Courts
have jurisdiction over such cases.
2.
3.
4.
5.
6.
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7.
Contracting
by
respondent
of
a
subsequent bigamous marriage, whether
in the Philippines of abroad.
8. Sexual infidelity or perversion.
9. Attempt on the life of petitioner by
respondent.
a. There is no need for criminal
conviction.
10. Abandonment of petitioner by respondent
without justifiable cause for more than
one year.
Gandioco v Pearanda
155 SCRA 725 (1989)
In sexual infidelity as a ground for legal
separation, there is no need for prior
conviction for concubinage, because legal
separation only requires a preponderance of
evidence, as opposed to proof beyond
reasonable doubt required in concubinage.
Lapuz v. Eufemio
43 SCRA 177
The action of the plaintiff in filing for legal
separation does not survive after her death.
Death of either spouse dissolves the marriage.
An action for legal separation is purely
personal between the spouses.
Dela Cruz. v. Dela Cruz
22 SCRA 333
Abandonment
is
not
mere
physical
abandonment but also financial and moral
desertion. There must be an intention never
to return.
B. DEFENSES
Grounds for denying
(4CMRPD) (Art. 56, FC)
legal
separation
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CIVIL LAW
Reconciliation period:
Action cannot be tried before six months have
elapsed since the filing of the petition (Art. 58.
FC)
Attempts on reconciliation:
Action cannot be tried unless the court has
attempted to reconcile the spouses, and
determined
that
despite
such
efforts,
reconciliation is highly improbable (Art. 59,
FC)
Confession:
No decree of legal separation shall be based
upon a stipulation of facts or a confession of
judgment (Art. 60, par. 1. FC)
Collusion:
The court shall assign the prosecuting
attorney or fiscal to make sure that there is
no collusion between the parties, and that
evidence is not fabricated or suppressed (Art.
60, par. 2, FC)
D. EFFECTS OF FILING PETITION FOR
LEGAL SEPARATION (LAC)
1. The spouses are entitled to live separately
(Art. 61, par. 1. FC).
2. Administration of Community or Conjugal
Property If there is no written
agreement between the parties, the court
shall designate one of them or a third
person to administer the ACP or CPG. (Art.
61, par. 2, FC)
3. Custody of children The court shall give
custody of children to one of them, if there
is no written agreement between the
spouses. It shall also provide for visitation
rights of the other spouse. (Art. 62, cf.
Art. 49. FC)
E. EFFECTS OF DECREE FOR
LEGAL SEPARATION
1. The spouses can live separately (Art. 63.
FC)
2. The ACP of CPG shall be dissolved and
liquidated, and the share of the guilty
spouse shall be forfeited in favor the
common children, previous children, or
innocent spouse (Art. 63. cf. Art. 42, par.
2).
3. Custody of the minor children shall be
awarded to the innocent spouse (Art. 63.
FC)
4. Guilty spouse shall be disqualified from
inheriting from innocent spouse by
intestate succession. The provisions in
favor of the guilty party in the will of the
innocent spouse shall also be revoked by
operation of law. (Art. 63, FC)
5. Donation propter nuptias in favor of the
guilty spouse may be revoked (Art. 64.
FC)
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6. Innocent
spouse
may
also
revoke
designation of guilty spouse as beneficiary
in an insurance policy, even if such
stipulations are irrevocable (Art. 64. FC).
7. Obligation for mutual support ceases, but
the court may order the guilty spouse to
support the innocent spouse. (Art. 198,
FC)
8. The wife shall continue to use the surname
of the husband even after the decree for
legal separation. (Art. 372, CC)
F. RECONCILIATION
How done:
Should the spouses reconcile, they should file
a corresponding joint manifestation under
oath of such reconciliation. (Art. 65, FC)
Effects of Reconciliation:
1. Proceedings for legal separation shall
be terminated at whatever stage. (Art.
66, FC)
2. If there is a final decree of legal
separation, it shall be set aside. (Art.
66, FC)
3. The separation of property and
forfeiture of share of guilty spouse
shall subsist, unless the spouses agree
to revive their former property regime
or to institute another property regime.
( Art. 66 cf. Art. 67, FC)
4. Joint custody of children is restored.
5. The right to intestate succession by
guilty spouse from innocent spouse is
restored.
6. The right to testamentary succession
depends on the will of the innocent
spouse.
G. DIVORCE
General Rule:
Decrees of absolute divorce obtained by
Filipinos abroad have no validity and are not
recognized in the Phil. dfd
Exception
(partial recognition of absolute divorce):
- When the divorce is validly obtained by
the alien spouses abroad which
capacitates him/her to remarry, the
Filipino spouse shall likewise have the
capacity to remarry. (Art. 26, par. 2
FC)
Twin elements for the application of par.
2, Art. 26, FC:
1. There is a valid marriage that has been
celebrated between a Filipino citizen
and a foreigner; and
2. A valid divorce is obtained abroad by
the alien spouse capacitating him or
her to remarry.
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CIVIL LAW
Republic v. Orbecido
G.R. No. 154380 (2005)
Given a valid marriage between 2 Filipino
citizens, where one party is later naturalized
as a foreign citizen and obtains a valid divorce
decree capacitating him or her to remarry, the
Filipino spouse remarry under Philippine law.
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.
A. OBLIGATION OF SPOUSES
(Arts. 68-71, FC)
3. Mistresses:
Live together
Observe mutual love, respect, and fidelity
Render mutual help and support
Fix the family domicile.
a. In case of disagreement, the court
shall decide.
5. Jointly support the family.
6. Manage the household.
Legamia v IAC
G.R. No. 63817 (1984)
The Supreme Court allowed the mistress to
use her live-in partners name, since everyone
already knew that she was a mistress, so as
to avoid confusion.
Tolentino v. CA
G.R. No. 41427 (1988)
A divorced woman may continue using the
surname of her former husband. Philippine
laws are silent in this issue. Moreover, there
is no usurpation as she never represented
herself as Mrs. Arturo Tolentino after the
divorce, but simply as Mrs. Consuela DavidTolentino.
1.
2.
3.
4.
4. Divorcees
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CIVIL LAW
DONATIONS
PROPTER NUPTIAS
Does not require
express acceptance
May be made by
minors (Art. 78)
May include future
property
If present property is
donated and property
is not absolute
community, limited
to 1/5
Grounds for
revocation - In Art.
86
ORDINARY
DONATIONS
Express
acceptance
necessary
Cannot be made
by minors
Cannot include
future property
No limit to
donation of
present property
provided
legitimes are not
impaired
Grounds for
revocation - in
donation laws
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CIVIL LAW
RULES:
1. Before Marriage
General Rule:
Future spouses cannot donate to each other
more than 1/5 of their present property
(excess shall be considered void) (Art. 84, FC)
Exception:
If they are governed by ACP.
2. During Marriage
General Rule:
Spouses cannot donate to each other, directly
or indirectly (donations made by spouses to
each other during the marriage are void) (Art.
87, FC)
Exception:
Moderate gifts on the occasion of any family
rejoicing.
Grounds for Revocation of
Propter Nuptias (Art. 86, FC)
Donation
for
revocation
of
Matabuena v Cervantes
38 SCRA 284 (1971)
The donation between common-law spouses
falls within the provision prohibiting donations
between spouses during marriage.
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UP
5. DISSOLUTION OF ACP
ACP terminates upon: (Art. 99, FC)
1. Death of either spouse follow rules in
Art. 103
2. Legal Separation follow rules in Arts. 63
and 64
3. Annulment or judicial declaration of nullity
follow rules in Arts. 50 to 52
4. Judicial separation of property during
marriage follow rules in Arts. 134 to 138
Rules on De Facto Separation:
(ART. 100, FC):
De facto separation does not affect the ACP.
EXCEPT that:
1. Spouse who leaves the conjugal home
without just cause shall not be entitled
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2.
3.
4.
5.
6.
CIVIL LAW
UP
Onas v. Javillo
59 Phil. 733 (1934)
Javillo contracted 2 marriages. SC ruled that
each
absolute
community
should
be
considered owner of the parcels of land
acquired during its existence.
Death
discontinues ACP.
Vda. De Delizo v. Delizo
G.R. No 32820 (1976)
In case of doubt as to which community the
existing properties belong, the same shall be
divided between the different communities in
proportion to the capital and duration of each.
D. CONJUGAL PARTNERSHIP OF GAINS
WHERE IT APPLIES:
1. For marriages before the implementation
of the Family Code.
2. For marriages after the Family Code, if
agreed to by the parties through a
marriage settlement.
HUSBAND AND WIFE PLACE IN COMMON
FUND:
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CIVIL LAW
EXCLUSIVE
SPOUSES:
PROPERTIES
OF
THE
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CIVIL LAW
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CIVIL LAW
1.
Property
acquired
before
marriage
.
2.
Property
acquired
during
marriage
3. Upon
dissolution of
marriage
4. Basis
5.
Liquidation
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CPG
Each
spouse
retains
his/her
property;
only fruits
part
of
conjugal
property
ACP
Properties
become part
community
property
Part
of
conjugal
property
Becomes conjugal
property.
CPG
Separate
properties
are
returned;
net profits
divided
equally
between
spouses or
heirs.
Capital and
properties
of spouses
kept
separate
and
distinct
from
benefits;
insurmoun
table
obstacle to
presumption of
solidarity
Exclusive
properties
will have
to be
identified
and
returned,
and
sometimes
, identifycation is
difficult.
ACP
Net remainder of
ACP divided
equally between
spouses or heirs.
of
E. SEPARATION OF PROPERTIES
DURING MARRIAGE
In the absence of an express declaration in
the marriage settlements, the separation of
property between the spouses during the
marriage shall not take place except by
judicial order. (Art. 134)
Judicial separation of property may either be
voluntary or for sufficient cause.
SUFFICIENT
CAUSES
FOR
JUDICIAL
SEPARATION OF PROPERTIES (CALASA)
(ART. 135):
Easier to liquidate
because net
remainder of
community
properties are
simply divided
between spouses
or heirs.
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1.When
the
civil
interdiction
terminates.
2.When
the
absentee
spouse
reappears.
3.When the court, being satisfied that the
spouse
granted
the
power
of
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CIVIL LAW
not Art.
olygamous
37
marriage
(incestuo
(Art.35(4))
us
void 6. incestuous
marriage)
marriages
not Art.
under
38 (void
Art.37
marriage
7. Void
by reason
marriages
of public
by reason of
policy)
public policy
not
under
bigamous
Art.38
4. other void
marriages
due
to
absence of
formal
requisite
Salaries
and
wages
Art.147
Properties
acquired
through
exclusive
funds
Properties
acquired
by
both
through
work or
industry
F. PROPERTY REGIME OF
UNIONS WITHOUT MARRIAGE
Applicability
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Art.148
1. man
and
woman
2. living
together as
husband
and wife
3. NOT
capacitated
to
marry
(Art.35(1)
under
18
years old)
4. adulterous
relationship
(e.g.
concubinage
)
5. bigamous/p
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Separately
owned
parties
by
Art.148
Remains
exclusive
provided
there is proof
Remains
exclusive
Governed by
rules on coownership
Owned
in
common
in
proportion
to
respective
contribution
Art.147
1. man
and
woman
2. living
together
as
husband
and wife
3. with
capacity to
marry
(Art.5
without
any
legal
impedimen
t)
at
least
18 years
old
Owned
in
equal shares
Properties
acquired
while
living
together
Forfeiture
2008
Owned in
equal
shares
since it is
presumed
to
have
been
acquired
through
joint
efforts
if
one
party did
not
participate
in
acquisitio
n,
presumed
to
have
contribute
d through
care and
maintenan
ce
of
family and
household
When
only
one of the
No
presumption of
joint
acquisition.
When there is
evidence
of
joint
acquisition but
none as to the
extent of actual
contribution,
there
is
a
presumption of
equal sharing
If one party is
validly married
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CIVIL LAW
to another:
- his/her share
in
the
coowned
properties will
accrue to the
ACP/CPG
of
his/her existing
valid marriage
If the party
who acted in
bad faith is not
validly married
to
another,
his/her
share
shall
be
forfeited in the
same manner
as
that
provided in Art
147
The same rules
on
forfeiture
shall apply if
both
parties
are in bad faith
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and
CIVIL LAW
who
UP
General Rule:
Only the husband can impugn the legitimacy
of a child
Exceptions:
The heirs of the husband may impugn the
childs filiation in the following cases:
a. If the husband dies before the
expiration of period for filing the action
b. If the husband dies after filing without
desisting
If the child was born after the death of the
husband
When to impugn the legitimacy of a child:
1. Within 1 year from knowledge of the
birth or its recording in the civil register, if
the impugner resides in the city or
municipality where the birth took place or
was recorded;
2. Within 2 years from knowledge of the
birth or its recording in the civil register, if
the impugner resides in the Philippines
other than in the city or municipality
where the birth took place or was
recorded;
3. Within 3 years from knowledge of the
birth or its recording in the civil register, if
the impugner resides abroad
NOTE: Legitimacy cannot be collaterally
attacked. It can only be impugned in a direct
action.
BAROPS
Termination
of 1st Celebration
marriage
of 2nd
marriage
180 days
after
celebration
of 2nd
marriage
Child of
the 1st
marriage
2008
300 days
after
termination
of 1st
marriage
Child of
the 2nd
marriage
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CIVIL LAW
Cabatania v.CA
G.R. No. 124814 (2004)
A certificate of live birth purportedly
identifying the putative father is not
competent evidence of paternity when there is
no showing that the putative father had a
hand in the preparation of said certificate. The
local civil registrar has no authority to record
the paternity of an illegitimate child on the
information of a third person.
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Continuous
means
uninterrupted
and
consistent, but does not require any particular
length of time.
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CIVIL LAW
To receive support
from their parents,
their ascendants,
and
in
proper
cases,
their
brothers
and
sisters,
in
conformity
with
the provisions of
this
Code
on
Support
Entitled
to
the
legitime and other
successional rights
granted to them
by the New Civil
Code
ILLEGITIMATE
To bear the surname
of their mother [may
also use the surname
of the father if their
filiation
has
been
expressly recognized
by the father (R.A.
9255)]
To receive support in
conformity with the
Family Code
XI. ADOPTION
LEGITIMATION
The law merely
makes
legal
what exists by
nature
Persons
affected
Only
natural
children
D. LEGITIMATED CHILDREN
Procedure
Extrajudicial
acts of parents
Who
applies
Only by
parents
Effect
Same
status
and rights as a
legitimated
child not only
in relation to
the legitimizing
parents
but
also to other
relatives
both
ADOPTION
The
law
merely
creates by
fiction
a
relation
which
did
not in fact
exist
Generally
applies
to
strangers
Always by
judicial
decree
By
one
parent
alone
Creates
a
rel.
only
between
the
child
and
the
adopting
parent
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CIVIL LAW
PRE-ADOPTION SERVICES:
A. Filipino Citizens
1. Of legal age
2. In possession of full civil capacity and legal
rights
3. Of good moral character
4. Has not been convicted of any crime
involving moral turpitude
5. Emotionally and psychologically capable of
caring for children
6. At least sixteen (16) years older than
adoptee, except when adopter is biological
parent of the adoptee or is the spouse of
the adoptees parent
7. In a position to support and care for
his/her children in keeping with the means
of the family
B. Aliens
1. Possession
of
the
same
as
the
qualifications for Filipinos
2. His/her country has diplomatic relations
with the Philippines
3. Has been living continuously for 3 years
(provided that absences not exceeding 60
days per 1 year for professional, business,
or emergency reasons are allowed) in RP
prior to filing of decree is entered except
this may be waived under the following:
(i) A former Filipino Citizen who seeks to
adopt a relative within the 4th degree
of consanguinity or affinity
(ii) One who seeks to adopt the legitimate
or illegitimate child of his/her Filipino
spouse
(iii)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
4. Has been certified by his/her diplomatic or
consular
office
or
any
appropriate
government agency that he/she has the
legal capacity to adopt in his/her country
5. His/her government allows the adoptee to
enter his/her country as his/her adoptee
6. Has submitted all the necessary clearances
and such certifications as may be required
C. Guardians
With respect to theirs ward after the
termination of the guardianship and
clearance of his/her accountabilities
Husband and wife shall adopt jointly
except:
a. if one spouse seeks to adopt the
legitimate child of the other
b. if one of the spouse seeks to adopt
his/her illegitimate child provided that
other spouse has signified his/her
consent
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CIVIL LAW
RESCISSION OF ADOPTION:
Adoption, being in the best interest of the
child, shall not be subject to rescission by the
adopter(s).
Adopted may request for rescission based on
the ff grounds:
1. repeated
physical
and
verbal
maltreatment
2. attempt on life of adoptee
3. sexual assault or violence
4. abandonment and failure to comply
with parental obligations
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TRIAL CUSTODY:
XII. SUPPORT
SUPPORT
consists
of
everything
indispensable
for
sustenance,
dwelling,
clothing, medical attendance, education and
transportation, in keeping with the financial
capacity of the family.
KINDS OF SUPPORT:
1. Legal that which is required to be given
by law
2. Judicial that which is required to be
given by court order whether pendent elite
or in a final judgment
3. Voluntary or Conventional by
agreement
CHARACTERISTICS OF SUPPORT
(PREVIW):
1. Personal
2. Intransmissible
3. Not subject to waiver or compensation
with regard to future support
4. Exempt from attachment or execution
5. Reciprocal on the part of those who are by
law bound to support each other
6. Variable
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CIVIL LAW
minor are subsidiarily liable for said
acts and omissions of the minor.
UP
Substitute
Parental
Authority
It
is
exercised in
case
of
death,
absence, or
in case of
unsuitability
of parents.
It is exercised concurrently
with the parental authority
of the parents and rests on
the theory that while the
child is in the custody of the
person exercising special
parental
authority,
the
parents
temporarily
relinquish parental authority
over the child to the latter.
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CIVIL LAW
[ART.4, PD603]
strive to live an upright and virtuous
life
love, obey, respect his parents and
cooperate with them in strengthening
the family
extend his love to his brothers and
sisters
exert his utmost to develop his
potentials
XIV. FUNERALS
GENERAL GUIDELINES:
1. Duty and right to make arrangement in
funerals in accordance with Art. 199 of FC:
a. Spouse
b. Descendants in nearest degree
c. Ascendants in nearest degree
d. Brothers and sisters
2. The funeral shall be in keeping with the
social position of the deceased
3. The funeral shall be in accordance with the
expressed wishes of the deceased
a. in the absence of expressed wishes,
his religious beliefs or affiliation
shall determine
b. in case of doubt, the persons in Art.
199 of FC shall decide
4. Any person who disrespects the dead or
allows the same shall be liable for
damages
***
DUTIES OF CHILDREN:
[ART.357, NCC]
obey and honor his parents or guardian
respect old relatives and persons
holding substitute parental authority
exert his utmost for his education and
training
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PROPERTY
CIVIL LAW
Property
TABLE OF CONTENTS
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.
XII.
XIII.
XIV.
XV.
XVI.
XVII.
XVIII.
XIX.
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Classification
Ownership
Accession
Quieting of Title
Ruinous Buildings and Tress in Danger of Falling
Co-Ownership
Condominium Law (Act. No. 4726)
Possession
Usufruct
Easements
Legal Easements
Voluntary Easements
Nuisance
Registry of Property
Different Modes of Acquiring Ownership
Prescription
Tradition
Lease
Donation
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36
41
42
48
49
49
55
57
63
65
70
77
78
80
80
81
82
83
89
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CIVIL LAW
3. immovables by destination- (4) (5)
(6) (9) and object to remain at a fixed
place on a river, lake, or coast
4. immovables by analogy or by law(10)
PROPERTY
I. CLASSIFICATION
CLASSIFICATION as to mobility
Art. 414 (1) Immovable or real property
(2) Movable or personal property
Art. 415. Immovables : MADAMS C
FLAT
1. Land,
buildings,
roads,
constructions
adhered to soil;
2. Trees, plants, growing fruits-attached to land/form integral
part of immovable
3. Everything
attached
to
immovable in fixed manner-cannot be separated without
breaking / deterioration
4. Statues,
reliefs,
paintings,
objects for ornamentation in
buildings / on lands
a. by
the
owner
of
immovable
b. manner reveals intention
to attach
permanently
5. Machinery,
receptacles,
instruments, implements
intended by owner for an
industry;
works
which
may be carried
on
in
building or on a piece of land,
and
tend directly to meet the
needs of
industry or works
6. (6) Animal houses, pigeonhouses, beehives,
fish ponds,
breeding
places
in
case
owner placed / preserves
them with
intention
to
be
permanently attached to
land,
AND form permanent part of it
--animals are included
7. Fertilizer actually used on a piece
of land
8. Mines, quarries, slag dumps,
while matter their matter forms
part of the bed, and waters
running or stagnant
9. Docks and structures which,
though floating, are intended by
their nature and object to remain
at a fixed place on a river, lake,
or coast;
10. Contracts for public works, and
servitudes
and
other
real
rights
over
immovable
property.
Art. 416.
Personal Property
(Movables):
FLONTS
(1)Those
movables
susceptible
of
appropriation Not
included
in
the
preceding article;
(2)Real property which by law is
considered as
personal property;
(3)Forces of nature which are brought
under control by science;
(4) all things which can be transported
from place to place without impairment
of
the real property to which they
are
fixed.
Classification:
1. immovables by nature - (1) and (8)
2. immovables by incorporation- (2) (3)
(7)
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from
alone.
(5)
Not
extinguished
by the loss or
destruction of
the thing.
(6)
Produces
only personal
actions against
definite
debtor.
Classification of Movables
(a)
Consumables
includes those
movables which cannot be used in a
manner appropriate to their nature
without their being consumed
(b)
Non-consumable- includes all
others
Classification
Ownership
According
to
Personal Rights
(1)
There is a
definite active
and
passive
object.
(2) Object is an
intangible
thing.
(3)
Personal
affects
the
thing directly
through
the
prestation
of
the debtor.
(4) Creation of
the
juridical
title is by title
UP
individually
or
collectively
BAROPS
2008
Page 37 of 325
PROPERTY
CIVIL LAW
Cases
Churches and other consecrated
objects are outside the commerce of
man (Barlin vs. Ramirez, 1907)
Reclaimed land is public property. In
case of gradual erosion by the ebb
and flow of the tide, private property
may become property of the public
domain, where it appears that the
owner abandoned it or permitted it
to be destroyed. When they stay in
that condition until reclaimed by
filling in done by the government,
they continue to be government
property after reclaiming. Immediate
possession by the former owner does
not confer on him ownership of the
lots,
because,
as
they
were
converted into property of the public
domain, no private person could
acquire title except in the form and
manner
established
by
law.
(Government of the Philippine
Islands v. Cabangis)
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PLENARY ACTION
TO
RECOVER
POSSESSION
(ACCION
PUBLICIANA)
A civil proceeding to
recover the better
right of possession
except in cases of
forcible
entry/unlawful
detainer.
Also used to refer to
an ejectment suit
filed
after
the
expiration of 1 year
from the unlawful
withholding
of
possession of the
realty.
BAROPS
2008
ACTION TO RECOVER
POSSESSION BASED ON
OWNERSHIP
(ACCION
REINVINDICATORIA)
An action to seek the
recovery
of
ownership,
necessarily including the
jus utendi and jus fruendi.
Page 38 of 325
PROPERTY
CIVIL LAW
WHEN
APPLICABLE
1. When
dispossession is
by any means
other than those
mentioned
in
SEC 1 RULE 70
RoC
2. When, although
any
of
the
special
circumstances is
present,
where
the
1
year
prescriptive
period
for
bringing
an
action for forcible
entry or unlawful
detainer
has
expired
ISSUE
Physical/material
possession (possession
de facto) (i.e. NOT civil
possession
or
possession
de
jure,
which arises from the
ownership or is one of
the
attributes
of
ownership), of which a
person 1) has been
deprived or 2) against
whom it has been
withheld by any of the
means/circumstances
mentioned in RULE 70
WHO MAY
INSTITUTE
1. A person deprived
of the possession of
any land or building
by
force,
intimidation, threat,
strategy, or stealth
(forcible entry under
RULE 70) ;
2. A landlord, vendor,
vendee, or other
person
against
whom
the
possession of any
land or building is
unlawfully withheld
after the expiration/
termination of the
right
to
hold
possession by virtue
of
any
contract,
express or implied
(unlawful detainer);
or
3. The
legal
representatives/
assigns of any such
landlord,
vendor,
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Possession de jure
of
realty
independent of the
title and restitution
of possession.
This action is distinct
and different from
an
action
for
recovery of title or
ownership.
A
judgment
rendered
here
is
conclusive only as to
the
question
of
possession, but not
as to the question of
ownership.
An owner who is
dispossessed
by
means other than
those mentioned in
RULE 70 RoC, or
when the possession
of land is due to
tolerance
of
the
owner.
It is not necessary
to wait until the
expiration of 1 year
before
commencement
of
action.
It can also be filed
after the expiration
of the 1 year period
if no action for
forcible
entry
or
unlawful
detainer
has been filed during
that time, otherwise,
barred.
BAROPS
2008
Page 39 of 325
PROPERTY
WHAT HAS
TO
BE
ALLEGED
WHERE
FILED
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CIVIL LAW
vendee
or
other
person
1. Prior possession de
facto
2. Undue
deprivation
thereof
When the complaint
fails
to
aver
acts
constitutive of forcible
entry/unlawful detainer
(how
he
was
dispossessed),
the
remedy
should
be
either accion publiciana
or
accion
reinvindicatoria.
In an ejectment suit,
issue of ownership can
be passed upon by the
court
only
by
determining the issue
of possession de facto.
An action for ejectment
is merely a quieting
process. If plaintiff has
in his favor priority in
time,
he
has
the
security that entitles
him to remain in the
property (even against
the owner himself) until
he is lawfully ejected by
a person having a
better right by an
accion publiciana or
accion reinvindicatoria.
MTC
Summary In nature
these cases involve a
disturbance of social
order which must be
abated as promptly as
possible without any
undue
reliance
on
technical
and
procedural rules
UP
For
an
action
to
reconveyance to prosper,
the property should not
have passed into the hands
of an innocent purchaser
for value.
RTC
Prescriptive Periods:
1. 4 yearsif based on
fraud from date of
issuance
of
certificate of title
over property
2. 10 yearsif based
on
implied
or
constructive trust
3. Imprescriptible
when plaintiff is in
possession
of
property
4. 30 years (without
prejudice to what is
established for the
acquisition
of
ownership and other
real
rights
by
prescriptionART1141)if
real
actions
over
immovables
BAROPS
2008
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PROPERTY
CIVIL LAW
II. OWNERSHIP
Art. 427. Ownership may be exercised
over things or rights.
Ownership is subject
imposed by:
1. LAW and
2. RIGHTS of others
to
restrictions
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BAROPS
2008
Page 41 of 325
PROPERTY
CIVIL LAW
III. ACCESSION
Art. 440.
The ownership of property
gives the right by accession to
everything which is produced thereby, or
which is incorporated or attached
thereto, either naturally or artificially.
General Principles of Accession
(1) Accessory follows the principal
(2) No unjust enrichment (Art. 443)
(3)
All works, sowing, and planting
are presumed made by owner & at
his expense, unless otherwise proved
(Art. 446)
(4)
Accessory
incorporated
to
principal such that it cannot be
separated without injury to work
constructed
or
destruction
to
plantings or construction of works.
(5)
Bad faith involves liability for
damages
(6)
Bad faith of one party neutralizes
bad faith of the other (Art. 453).
(7)
Ownership of fruits belong to the
principal thing; Exceptions: (PULA)
(i) possession in good faith is
entitled to fruits
(ii) usufructuary is entitled to fruits
(iii) lessee is entitled to fruits
(iv) antichretic creditor is entitled to
fruits
Kinds of Accession
(1)
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2008
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PROPERTY
(2)
CIVIL LAW
immovable
industrial
-
(i) Building,
(ii) Planting, or
(iii) Sowing (Arts. 445-456)
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2008
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PROPERTY
CIVIL LAW
Owner of Materials
GF: right to be paid value of materials
May remove materials if can be separated
without injury (no accession) but accession
prevails (hence, most likely only get paid)
GF: right to be paid value of materials +
indemnity or remove materials even with
damage + indemnity
Land-owner
GF: options
GF
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2008
Page 44 of 325
PROPERTY
CIVIL LAW
Land-owner
GF
BPS
OM
GF (GF)
GF
LO appropriates and pays indemnity: OM can proceed against LO only after BPS
refuses/cannot pay, OM cannot remove
LO sells land to BPS: OM can only proceed against BPS
GF
BF (GF)
GF
LO compels demolition: OM cannot claim from LO, BPS solely liable
LO appropriates and pays indemnity: OM can proceed against LO only after BPS
refuses/cannot pay, OM cannot remove
LO sells land to BPS: OM can only proceed against BPS
GF (GF)
GF
BF
BPS removes even with damage: OM can only go after BPS
BPS forces LO to pay indemnity: OM cant demand removal/return but OM can proceed
against BPS and subsidiarily, the LO
BF
BF (GF)
GF
Similar to GF-GF-(GF)-GF
LO appropriates and pays indemnity: OM can proceed against LO only after BPS
refuses/cannot pay, OM cannot remove
LO sells land to BPS: OM can only proceed against BPS
GF
GF (BF)
GF
LO appropriates and pays indemnity: OM can proceed against LO only after BPS
refuses/cannot pay, OM cannot remove
LO sells land to BPS: OM can either ask BPS for indemnity + damages or remove
material even with damage
GF
BF (BF)
GF
LO compels demolition: OM can compel return of material by removing even with
damage + damages or OM can ask for indemnity + damages
LO appropriates: OM cant remove because right of removal applies only to BPS in BF,
LO cant be prejudiced; OM only entitled to the value of materials (indemnity) +
damages from LO
LO sells land to BPS: OM can compel removal (straightforward 447) or ask BPS for
indemnity + damages
BF
GF (BF)
GF
BPS removes even with damage: OM can either compel BPS to pay indemnity or to
return materials, in both cases + damages
BPS forces LO payment of indemnity: OM cant demand removal/return but OM can
proceed against BPS and subsidiarily, the LO
BF
BF (BF)
GF
Similar to GF-GF-(BF)-GF
LO appropriates and pays indemnity: OM can proceed against LO only after BPS
refuses/cannot pay, OM cannot remove
LO sells land to BPS: OM can either ask BPS for indemnity + damages or remove
material even with damage
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2008
Page 45 of 325
PROPERTY
CIVIL LAW
Cases:
A forced co-ownership occurs when the
BPS has acted in good faith. Owner of the
land ihas the right of retention (to pay)
because his right is older and because, by
the principle of accession, he is entitled to
the ownership of the accessory thing.
(Bernardo vs. Baticlan)
Since the option to remove or demolish
improvement is given to the LO and it is
limited to paying for the improvement or
selling his land to the BPS, he cannot
refuse to exercise his right of choice and
compel the builder to remove or demolish
the improvement. He is entitled to such
removal only when after choosing to sell
his land, the other party fails to pay for
the same. (Ignacio vs Hilario)
An order by a court compelling a builder in
good faith to remove is building from land
belonging to another who chooses neither
to pay for such building nor sell the land is
null and void for being offensive to Art.
448. (Sarmiento v. Agana)
While a possessor in good faith may retain
the property until he is reimbursed for
necessary and useful expenses, all the
fruits he receives from the moment his
good faith ceases must be deferred or
paid by him to the LO. He may, however,
secure the reimbursement of his expenses
by using the fruits to pay it off (deduct the
value of the fruits he receives from the
time his good faith ceases from the
reimbursement due him). (Ortiz vs
Kayanan)
A BPS in good faith does not lose his
rights under Art. 448 merely because of
the fact that some years after acquiring
the property in good faith, helearned
about and aptly recognized the right of
the LO to a portion of the land occupied
by
the
building.
The
supervening
awareness does not prejudice its right to
claim the status of a builder in good faith.
(Tecnogas Phil. Manufacturing Corp.
vs CA)
The BPS in good faith should not pay
rentals to the LO spouses. The spouses,
having
opted
to
appropriate
the
improvement on the lot, have to
reimburse the BPS of the cost of
construction of the building (in accordance
with Art 546). The BPS has the right to
retain the improvements until he is
reimbursed.
An implied tenancy or
possession in fact is created pending the
payment of the corresponding indemnity.
(Pecson v CA)
Good faith consists in the belief of the
builder that the land he is building on is
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BAROPS
Accession in Natural
(i) Alluvium 457 the accretion
which lands adjoining the banks or
rivers, lakes, creeks or torrents
gradually receive from the
Requisites of alluvium: (CANG)
(a) The accretion must be gradual
(b)
(c)
be
the
The
land
where
the
accretion takes place must be
adjacent to the banks
(d)
must be natural
Avulsion
1. Deposit of soil is
gradual
1. Deposit of soil is
sudden or abrupt
2. Deposit of the
soil belongs to the
owner
of
the
property where the
same was deposited
2008
3. The detached
portion
can
be
identified
Page 46 of 325
PROPERTY
CIVIL LAW
The
portion
of
land
transported must be known and
identifiable
(b)
or sudden.
seas
within
Phil.
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BAROPS
(1)
Adjunction or Conjunction that
which takes place whenever movable
things belonging to different owners
are united in such a way that they
cannot be separated without injury,
thereby forming a single object (Art.
466)
Ownership of new object formed by
adjunction
Owner of Principal OP
Owner of Accessory OA
(a) union in Good Faith OP acquires
accessory, AND pays OA for its
value in uncontroverted state.
(b)
2008
Page 47 of 325
PROPERTY
CIVIL LAW
-if OA incorporated in BF
1. lose the thing and
2.
indemnify
OP
for
damages
-if OP acted in BF
1. OA has right to choose
-payment of value
-separation (even if
destroys principal)
2. OA indemnified
(c)
If OP or OA 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.
(d) if involves 3 things Art. 466
should be applied in an equitable
manner. The principal should be
determined and distinguished from
the
others
which would
be
considered the accessories.
TEST
to
determine
adjunction:
principal
in
the
new
object
in
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2008
Page 48 of 325
PROPERTY
CIVIL LAW
Differences between action to quiet title, action to remove a cloud, and action to
prevent a Cloud
QUIET TITLE
REMOVE CLOUD
PREVENT CLOUD
Purpose is to put to an end Intended
to
procure
the Removal of a possible
to vexatious troublesome cancellation; delivery; release foundation for a future
litigation over the property of an instrument, encumbrance hostile claim.
involved
or claim, which constitutes a
claim in plaintiffs title, and
which may be used to injure or
to vex him in his enjoyment of
his title.
Remedial action: involving a
present adverse claim
Filed
against
defendant
who
asserts claims based on an invalid
instrument (but not apparent)
Prescription of actionImprescriptible
if plaintiff is in possession; if not,
prescribes within period for filing accion
publiciana, accion reivindicatoria.
Notes:
An action for reconveyance:
a) Prescribes in 10 years if the
plaintiff is NOT in possession of
the property and if the action for
reconveyance is based on an
implied or constructive trust. The
point of reference is the date of
registration of the deed or the
date of the issuance of the
certificate of title over the
property.
b) Is
IMPRESCRIPTIBLE
if
the
person claiming to be an owner is
in actual possession of the
property. Here, the right to seek
reconveyance in effect seeks to
quiet title. (Olviga v. CA)
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done
by
government at expense of owner
VI. CO-OWNERSHIP
Art. 484.
There is co-ownership
whenever the ownership of an undivided
thing or right belongs to different
persons.
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2008
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PROPERTY
CIVIL LAW
Characteristics of Co-ownership
(PUSAM)
(1)
plurality of owners, but only one
real right of ownership
(2)
unity of material of the object of
ownership
(3) recognition of ideal shares or aliquot
(4) absolute control of each co-owner
over his ideal share, not over specific
portions of the property
(5) mutual respect among co-owners in
regard to the use, enjoyment, and
preservation of the property owned
in common.
Differences between co-ownership
and joint tenancy
Co-ownership
Tenancy
in
Common,
Ownership
in
Common,
Codominium
Civil law origin
Each
co-owner
owner of his ideal
share
Each
co-owner
may dispose of his
undivided
share
without the others
consent.
In case there is a
co-owner who is a
minor, minority as
a defense against
prescription
is
exclusive to him.
Joint Ownership
Joint
tenancy,
Tenancy
in
common, Notion of
all-for one, onefor-all
Common
Law/
Anglo-American
origin
Each joint owner,
the surviving joint
owners
are
subrogated in his
rights by accretion
Joint owner must
obtain the consent
of all the rest to
dispose
of
his
share.
The defense of one
joint owner can be
used as a defense
by all joint owners.
Differences
between
and co-ownership
Ordinary
Partnership
With legal/juridical
personality distinct
from its members
Created only by
agreement
or
contract to that
effect
Purpose
is
obtain profit
100% UP LAW
to
Creditors
of
individual partners
cannot attach and
sell on execution
the
shares
of
partners in the
partnership
Can
be
extinguished
by
the
death
or
incapacity of one
party
There is mutual
representation of
the parties
A partner cannot
transfer his rights
to a 3rd person
without
the
consent
of
the
others
Distribution
of
profits
can
be
stipulated
upon
(profit-sharing)
Death or incapacity
of a co-owner does
not affect existence
of a co-ownership
A special authority
is needed for such
representation.
A co-owner can
freely dispose of
his share without
need to ask the
consent
of
the
other co-owners.
Profits of a coowner depend on
his
proportionate
share;
profitsharing
is
invariable
(Art.
485) not subject to
stipulation
Sources of co-ownership
(1) Law
(a) Cohabitation
(i) Between man and woman
capacitated to marry each
other. (Art 147, FC)
(ii) Between man and woman not
capacitated to marry each
other (Art. 148, FC)
partnership
Co-ownership
No
legal
personality distinct
from its members
created by LAW
FOCUS
[Law,
Fortuitous
Event,
Occupancy,
Contract,
Succession]
Purpose
is
collective
enjoyment and to
maintain the unity
and preservation of
the things owned in
UP
common.
As
a
rule,
an
agreement to keep
the ownership for
more than 10 years
is void.
Creditors of a coowner can attach
his shares in the
co-owners and sold
on execution
(d) Succession
(i) Intestate succession (1078)
(ii) Testateif property is given
to two or more heirs by the
testator
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PROPERTY
CIVIL LAW
(2)Right
to
make
preservation
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repairs
for
Necessary expenses
- taxes and expenses for the
preservation of the thing which if
not made would endanger the
existence of the thing or reduce
its value or productivity
- may be incurred upon the will of
1 co-owner, but if practicable, he
must give reasonable notice to
the other co-owners
Useful expenses
- increase the income of the thing
owned in common for the benefit
of all the co-owners
- a lone co-owner cannot incur
such
expenses
without
the
consent of the others and then
ask reimbursement (resolution of
majority as per Art. 492)
- Effect of failure to notify coowners even if it was practicable
to do so: does not deprive coowner of right to reimbursement.
He is merely given the burden to
prove the necessity of such
repairs. He will not be fully
reimbursed if others can prove
that i.e., could have hired a
contractor who would charge less
(2)Contract
(a) Two or more persons agree to
create a co-ownershipmaximum
of ten years (494, 2nd par),
extendable by a new agreement.
(b) Universal Partnership
(i) Of all present properties (Art.
1778-1779, NCC)
(ii)
Of profits (Art. 1780,
NCC)
(c)
Associations and Societies,
whose articles are kept secret
wherein anyone of the members
may contact in his own name
with third persons (no juridical
personality)
Rights of each co-owner as to the
thing owned in common:
FRom
CUERPO
BAROPS
For:
1. expenses for preservation
2. taxes
BUT co-owner has option not to
contribute by renouncing so much of
his undivided interest equal to the
amount of contribution EXCEPT if
waiver is prejudicial to co-ownership
2008
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PROPERTY
CIVIL LAW
(6)Right
to
redemption
exercise
legal
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2008
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PROPERTY
3.
4.
5.
6.
in
common
is
essentially
Indivisible
- no physical partition but thing
maybe sold and co-owners
shall divide the proceeds
when there is a Stipulation
against it (not beyond 10 years)
when Condition of indivision is
imposed by transferor (donor or
testator) not exceed 20 years
Acquisitive prescription has set in
facor of a stranger to coownership or in favor of coowner.
when legal Nature of community
prevents partition (e.g. party
wall)
(8)Right to
proportion
CIVIL LAW
full
ownership
of
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2008
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PROPERTY
CIVIL LAW
Acts
of
Alteration/Acts
of Ownership
Relates to the use,
substance or form
of the thing
Acts
of
Administration
Also for the better
enjoyment of the
property
Have
a
more
permanent result
Effects
are
transitory
character
of
Consent of all is
necessary
Consent
of
the
financial majority
will be binding
Does not give rise
to a real right over
the thing owned in
common.
Examples:
(1) When the resolution calls for a
substantial change or alteration of
the common property or of the use
to which it has been dedicated by
agreement or by its nature
(2) When the resolution goes beyond
the limits of mere administration, or
invades the proprietary rights of the
co-owners, in violation of Art. 491
(prohibiting
against
acts
of
alteration)
(3) When the majority leases, loans,
or other contracts without security,
exposing the thing to serious danger
to the prejudice of the other coowners.
(4) When the majority refuse to
dismiss an administrator who is
guilty of fraud or negligence in his
management, or does not have the
respectability, aptitude, and solvency
required of persons holding such
position.
(5) When resolution, if carried out,
would cause serious injury to the
thing itself, such as an agreement
not
to
borrow
money
under
reasonable
terms
when
it
is
necessary for urgent repairs for
preservation, or for the payment of
taxes.
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PROPERTY
CIVIL LAW
Extinguishment of Co-Ownership
(1) Total destruction of the thing
(2) Merger of all the interest in one
person
(3) Acquisitive prescription
(a) By a third person
(b) By one co-owner against the
other co-owners
Requisites:
(i) Unequivocal
acts
of
repudiation of the rights of
the other co-owners (acts
amounting to ouster of other
co-owners)
(ii) Open and adverse possession,
not mere silent possession for
the
required
period
of
extraordinary
acquisitive
prescription.
(iii)Presumption
is
that
possession of a co-owner is
not adverse.
(4) Partition or division
(a) Right of Creditors of individual
Co-owners Art. 497
All creditors must be considered
to intervene in the partition of
the common property.
They must have become creditors
during the co-ownership
Co-owner debtors have the duty
to notify the creditors of the
partition
Otherwise partition not binding
on them
They can contest such partition if
they
formulate
a
formal
opposition thereto.
(b) Partition may be made:
(ii.)
Orally
Valid
and
enforceable
among the parties.
Statute of frauds does not
operate for partition is not
a conveyance of property
but merely a segregation
and designation of that
part of the property which
belongs to the co-owners.
(ii.)
In writing
(a) Court
will
just
confirm
such
written agreement.
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PROPERTY
CIVIL LAW
Method of taxation
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Case
Ownership of a unit, therefore, is a
condition sine qua non to being a
shareholder
in
the
condominium
corporation By necessary implication,
the
"separate
interest"
in
a
condominium, which entitles the holder
to become automatically a share holder
in the condominium corporation, as
provided
in
Section
2
of
the
Condominium Act, can be no other than
ownership of a unit. (Sunset View
Condominium v Judge Campos)
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2008
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PROPERTY
CIVIL LAW
VIII. POSSESSION
Definition and Concept
(1) Possession is the holding of a thing
of the enjoyment (exercise) of a
right (523), whether by material
occupation (de facto possession) or
by the fact that the thing or the right
is subjected to the action of our will.
(2) It is a real right independent of and
apart from ownership.
Essential requisites of possession
(1) Holding or control of a thing or right
(corpus) consists of either:
(a)
the material or physical
possession
(b)
subject action of our willexercise of a right
(c) constructive possession
(2)
Intention to possess (animus
possidendi)
it is a state of mind whereby the
possessor intends to exercise and
does exercise a right of possession,
whether or not such right is legal
intention may be inferred from the
fact that the thing in question is
under the power and control of the
possessor
may be rebutted by contrary
evidence
Cases:
The general rule is that the possession
and cultivation of a portion of a tract of
land under a claim of ownership of all is
a constructive possession of all, IF the
remainder is not in the adverse
possession of another. 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)
The rule on constructive possession does
not apply when the major portion of the
disputed property has been in the
adverse possession of homesteaders and
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Possession for
oneself, or
possession exercised in ones own
name and possession in the name of
another.
rights
of
possession
may
be
exercised through agents
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PROPERTY
CIVIL LAW
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better
right
preemption)
(9)
possession in
possession in BF
(e.g.,
GF
and
faith
and
(3)
Possession in good
possession in bad faith
Subjects of possession
All rights and things susceptible of
appropriation
Things which cannot be possessed:
(1) property of public dominion
(2) res communes
(3)
easements (discontinuous or
non-apparent)
(4) things specifically prohibited by
law
res nullius (abandoned or ownerless
property) may be possessed but
cannot be acquired by prescription
Acquisition of Possession
(1) Ways of acquiring possession
(a) Material occupation of the thing
occupation is used in the general
sense, i.e., a means of acquiring
possession of things, not of rights
kind of possession acquired is
only the fact of possession, not
the legal right of possession
(i)
Doctrine of constructive
possession
(ii)
Includes
constructive
delivery (equal to material
occupation in cases where
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may be
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PROPERTY
(4)
Rules
possession
CIVIL LAW
to
solve
conflict
of
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in
favor
of
the
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PROPERTY
CIVIL LAW
(4)
Of
non-interruption
of
possession
in
favor
of
present
possessor who proves possession at a
previous time until the contrary is
proved. (554, 1120-1124)
2 Kinds of Interruption
(1) Natural
(Art
1122)if
interruption is for more than 1
year.
(2) Civil (Art 1123) will start from
the service of summons but the
proper action must be filed
in case of natural interruption, the
old possession loses all its juridical
effects and therefore cannot be
tacked to the new possession for
purposes of prescription
in case of civil interruption, if
possession is recovered, it can be
connected to the time that has
elapsed as if it were continuous and
can
be
counted
in
favor
of
prescription
(5) Of exclusive possession of
property allotted to a participant in a
thing possessed in common for the
entire period during which copossession lasted;
(6) Of continuous possession or noninterruption of possession of which
he was wrongfully deprived for all
purposes favorable to him (561)
(7) Other presumptions with respect to
specific property rights
(i) Of extension of possession of real
property
to
all
movables
contained therein so long as it is
not shown that they should be
excluded (Art. 426)
(ii) Non-interruption of possession of
hereditary property (Art. 533,
Art. 1078)
(iii)Of just title in favor of possessor
in concept of owner, subject to
Art. 1141
Loss of Possession
(1) Abandonment
(2) AssignmentWON gratuitously or
onerously
(3) Destructionmust be total/goes
out of commerce
(4)
Possession of anotherthe
possession that is lost here refers
only to possession as a fact (de
facto), not the legal right of
possession (de jure)
NOTE: all the other 3 cases of loss of
possession (abandonment, assignment,
destruction) refer to loss of possession
de jure (real right of possession) and
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Fruits
received
CIVIL LAW
Effects of Possession in Good Faith or Bad Faith
Good Faith
Bad Faith
Entitled to the fruits while possession Must reimburse fruits received or
is in GF and before legal interruption fruits which legitimate possessor
(Art 544)
could have received (549);
Entitled to expenses for production,
gathering, and preservation
Pending
Fruits
Charges
Necessary
Expenses
Useful
Expenses
Ornamental
Expenses
Deterioration
or Loss
Costs
of
Litigation
prior
to
Same as with GF
Reimbursement only
No right to reimbursement. He also
cannot remove improvements even
he can do so without injury to the
principal thing
reimbursement
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IX. USUFRUCT
Definition
USUFRUCT is a real right which gives the
usufructuary
- a right to enjoy the property of
another
- with the obligation of preserving
its form and substance, unless
the title constituting it or the law
otherwise provides. (Art.562)
Characteristics
1. real right of use and enjoyment
of property owned by another
2. of a temporary duration
3. transmissible
4. may be constituted on real or
personal property, on tangibles
or intangibles
Rights of Usufructuary:
A. As to the thing and its fruits
1. right to possess and enjoy the
thing
itself,
its
fruits
and
accessions (566-567)
2. right to lease the thing (572)
3. right to improve the thing
Right to possess and enjoy the thing
itself, its fruits and accessions
Fruits belong to the usufructuary
except when they diminish the
substance
of the
thing (e.g.,
minerals in quarries), in which case
they will belong to the usufruct only
when the owner has dedicated the
property to the exploitation of such
products.
Dividends from shares are fruits.
Rights may be transferred, assigned,
or otherwise disposed of by the
usufructuary;
As to hidden treasure, usufructuary
is a stranger, so no right to it
Fruits pending at the beginning of
the
usufruct
belong
to
the
usufructuary, with no obligation to
refund the expenses of the owner.
But, if expenses for production were
incurred by third persons, they must
be reimbursed.
Fruits growing at the time of the
termination of the usufruct belong to
the owner, but the usufructuary
must be reimbursed from the
proceeds of such fruits for his
production expenses.
Right to lease the thing
even without consent of owner
BUT no alienation, mortgage, pledge
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3.
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4.
5.
6.
Causes
of
extinguishment
of
Usufruct (Art.603) DERM PLT
1. Death of the usufructuary, unless
a
contrary
intention
clearly
appears;
2. 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. Renunciation of the usufructuary;
4. Merger of the usufruct and
ownership in the same person;
5. Prescription;
6. Total Loss of the thing in
usufruct;
7. Termination of the right of the
person constituting the usufruct
Special Cases of Usufruct
1. over a pension or periodical income
(570)
2. of property owned in common (582)
3. of head of cattle (591)
4. over deteriorable property (578)
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X. EASEMENTS
Art. 613. Easement or Servitude:
encumbrance
imposed
upon
an
immovable for the benefit of another
immovable belonging to a different
owner...
Dominant estate: the immovable in
favor of which the easement is
established
Servient estate: the immovable
which is the subject of the easement.
Art. 614. Personal Easements:
established for the benefit of a
community, or of one or more persons
to whom the encumbered estate does
not belong.
- real right or encumbrance imposed on
an immovable for the benefit of another
immovable belonging to a different
owner or for the benefit of a community
or one or more persons to whom the
encumbered estate does not belong by
which the owner is obliged to abstain
from doing or to permit a certain thing
to be done on his estate.
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Easement v. Lease
EASEMENT
Real right WON
registered,
WON
real or personal
Imposed only
real property
on
LEASE
Real
right
only
when
it
is
registered,
or
when its subject
matter
is
real
property and the
duration exceeds 1
year.
May involve either
real or personal
property
Limited right to
both
the
possession and use
of
anothers
property.
Easement v. Usufruct
EASEMENT
USUFRUCT
Imposed only on May involve either
real property.
real or personal
property.
Limited
to
a Includes all the
particular
or uses and fruits of
specific use of the the property.
servient estate.
Non-possessory
Involves right of
right
over
an possession in an
immovable
immovable
or
movable.
Not
extinguished As
a
rule,
by death of the extinguished
by
dominant owner.
the death of the
usufructuary.
Essential Features of Easements or
Real Servitudes (RAIL-IRI-NARIP)
(1) It is a real right. It gives rise to an
action in rem or real action against
any possessor of the servient estate.
(2)
It is a right enjoyed over another
property (jus in re aliena). It cannot
exist in ones own property (nulli res
sua servit). Servient and dominant
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(7)
(8)
(9)
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Real/Predial
Personal
In favor of
another
immovable
(Art.613)
In favor of a
community or
of 1 or more
persons, may
be public or
private
(Art.614)
i.
Public:
vested in the
public
at
large or in
some class of
indeterminate
individuals
As to recepient of benefit
(6)
ii.
Private:
vested in a
determinate
individual or
certain
persons
Voluntar
y
As to its source
(5)
Classification
Establish
ed by will
or
agreeme
nt of the
parties or
by
a
testator
(Art.619)
Legal
Mixed
Impose
d by law
either
for
public
use or
in
the
interest
of
private
persons
(Art.619
)
Created
partly
by will
or
agreement
and
partly
by law
Continuous
As to its exercise
(4)
(3)
CIVIL LAW
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Use of which
is or may be
incessant,
without
the
intervention
of any act of
man.
(Art.615)
Apparent
Made known
and
are
continually
kept in view
by
external
signs
that
reveal
the
use
and
enjoyment of
the
same
(Art.615)
Discontinou
s
Used
at
intervals and
depend upon
acts of men
(Art.615)
Nonapparent
Show
external
indication
their
existence
(Art.615)
no
of
* In general,
negative
easements
are
nonapparent.
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As to
owner
duty
of
servient
PROPERTY
CIVIL LAW
Positive
Negative
Imposes upon
the owner of
the
servient
estate
the
obligation of
allowing
something to
be done or of
doing
it
himself
(Art.616)
Prohibits the
owner of the
servient
estate
from
doing
something
which
he
could lawfully
do
if
the
easement did
not
exist
(Art.616)
(a)
Positive
easementsfrom
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
(b)
Negative
easementsfrom
the day on which
the owner of the
dominant
estate
forbade,
by
an
instrument
acknowledged
before e notary
public, the owner
of
the
servient
estate,
from
executing an act
which would be
lawful without the
easement.
(Art.621)
All easements
a
juridical
act
which gives rise to
the servitude such
as the law (e.g.
donation, contracts
and wills)
- continious and
apparent (Art.620)
- continous
non-apparent
easements
(Art.622)
* Prescription does
not require good
faith or just title.
General rules for
acquisitive
prescription
of
ownership
and
other real rights do
not apply to it.
and
*
There
must
however
be
adverse possession
or exercise of the
easement.
discontinous
easements,
whether apparent
or non-apparent
(2)
Prescription
10 years
By
of
*
Discontinuous
easement can only
be acquired by title
and
not
by
prescription.
(3) By deed of
recognition
(Art.623)
Continuous
apparent
easements
(Art.620)
(5) By apparent
sign established
by the owner of
2
adjoining
estates.
The
time
reckoning
prescription:
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and
for
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(4)
By
judgment
(Art.623)
final
If easement
been acquired
no
proof
existence
available,
easement is
that
cannot
acquired
prescription
has
but
of
is
and
one
be
by
The existence of an
apparent sign of
easement between
two
estates,
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Easement of light and view go together.
Acquisition of easements is by title or by
prescription. The visible and permanent
sign of an easement is the title that
characterizes its existence. Existence of
the apparent sign had the same effect as
a title of acquisition of the easement of
the light and view upon death of original
owner. (Amor vs. Florentino)
established
or
maintained by the
owner
of
both,
shall
be
considered, should
either of them be
alienated, as a title
in order that the
easement
may
continue
actively
and
passively,
unless, as the time
the ownership of
the two estates is
divided,
the
contrary should be
provided in the
title of conveyance
of either of them,
or
the
sign
aforesaid should be
removed
before
the execution of
the
deed.
This
provision shall also
apply in case of
the division of a
thing
owned
in
common by two or
more
persons.
(Art. 624.)
Cases
The road is clearly a servitude
voluntarily constituted in favor of the
community under Art. 531. Having been
devoted by NNSC to the use of the
public in general, the road is charged
with public interest. And while so
devoted. NNSC may not establish
discriminatory exceptions against any
private persons. (North Negros Sugar
Co. vs Hidalgo)
Since the construction of the church,
there had been a side door in the wall
through which the worshippers attending
mass enter and leave, passing and
entering the land in question. As this use
of the land has been continuous, it is
evident that the church has acquired a
right to such use by prescription, in view
of the time that has elapsed since the
church was built and dedicated to
religious worship, during which period
the Municipality has not prohibited the
passage over the land by persons who
attend services held by the church.
(Municipality of Dumangas vs Bishop
of Jaro)
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Modes
of
Extinguishment
of
Easements (Art.631) (MINERRO)
UP
(3)
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(4)
CIVIL LAW
(5)
Renunciation
dominant estate
of owner of the
(6)
Redemption
agreed
between the owners.
upon
(7)
Other causes not mentioned
(a) Annulment
or
rescission
or
cancellation of the title constituting
the easement.
(b) Termination of the right of grantor
to create
the easement ( e.g.
redemption of the property sold a
retro because of the exercise of the
right of conventional redemption (
Art. 1618)
(c) Abandonment of the servient
estate
(d) Eminent domain
(e) Special cause of extinction of legal
right of way, the opening of an
adequate outlet to the highway
extinguishes the easement, if
servient owner makes a demand
for such extinguishment.(Art. 655)
(f) Registration of the servient estate
as FREE
(g) Permanent impossibility to make
use of the easement.
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Case
The dikes are continuous easements
since it does depend upon the act of
man, but is due to gravity. Being such, it
is subject to the extinction to the nonuser (20 years in the Old Code and 10
years in the New Code). (Ongsiaco v.
Ongsiaco)
(2) Easements on lands along
riverbanks
Abutment of Land
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Aqueduct
Drawing
waters
watering materials
(6)
and
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PROPERTY
CIVIL LAW
Servitude
without
indemnity
is
considered as a tacit condition of the
sale, exchange or partition, but not
implied in a simple donation.
When the right of way originally
established without indemnity should
disappear or become useless, a legal
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CIVIL LAW
Cases
A voluntary easement of right of way
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. (La Vista v. CA)
An easement of right of way can be
established through continued use.
(Vda. de Baltazar v CA)
(c)
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of
of
It
of
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CIVIL LAW
(f)
Intermediate Distances
and
Works
for
Certain
Constructions and Plantings
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CIVIL LAW
Easement of Lateral
Subjacent Support
and
XII. VOLUNTARY EASEMENTS
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Who
may
establish
voluntary
easements:
The OWNER possessing capacity to
ENCUMBER property may constitute
voluntary servitudes. (Art. 688)
The usufructuary, and even the
possessor in good faith, does not
have the right to do so because the
creation of a servitude is a
disposition of part of the right of
ownership, and no one but an
owner may do this.
A general capacity to contract is not
sufficient.
If there are various owners, ALL
must CONSENT, but consent once
given is irrevocable. (Art. 690 and
691)
Hence, their consent need not be
simultaneous.
In whose favor they are established:
(a)Praedial Servitudes
For the owner of the dominant
estate
For any other person having any
juridical
relation
with
the
dominant estate, if the owner
ratifies it.
(b)Personal Servitudes
For anyone capacitated to accept
In case of property under usufruct
The usufructuary must not be
prejudiced (Art 689)
Rights and Obligations
These are determined by the
(1) Title, and
(2) Possession
(in
case
of
prescription
enlarging
or
diminishing the initial voluntary
easement) (Art. 692)
Where the owner bound himself
to pay for the maintenance or do
some service he may abandon his
tenement and relieve himself of his
obligation (Art. 693)
XIII. NUISANCE
Art. 694. A nuisance is any act,
omission,
establishment,
business,
condition of property, or anything else
which: (HOSDU)
(1) Injures or endangers the health or
safety of others; or
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Right to Damages
A person may maintain an action at
law for damages caused by a nuisance
The payment of damages is generally
a mere reparation for past injuries,
and not an authority to continue the
wrong.
each repetition of it gives rise to a new
cause of action
Defenses to Action
Public Necessity
Estoppel
Art. 706. Any person injured by a
private nuisance may abate it by:
removing, or
if necessary, by destroying the
thing
which
constitutes
the
nuisance
o without
committing
a
breach of the peace or
doing unnecessary injury
o procedure for extrajudicial
abatement of a public
nuisance by a private
person be followed
Who may sue on Private Nuisances
Ownership of the legal title is not
necessary. Even a possessor may sue
Art. 707. A private person or a public
official extrajudicially abating a nuisance
shall be liable for damages:
(1) If he causes unnecessary injury; or
(2) If an alleged nuisance is later
declared by the courts to be not a real
nuisance.
Remedies of Property Owner
He may bring an action for replevin, or
enjoin its sale and damages if it is has
been sold; or action to enjoin private
parties from proceeding to abate a
supposed nuisance
Ask court to determine WON it is
indeed a nuisance
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XV.
DIFFERENT
MODES
ACQUIRING OWNERSHIP
OF
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XVI. PRESCRIPTION
It is the mode by which one
acquires ownership and other real rights
thru lapse of time; also a means by
which one loses ownership, rights &
actions; retroactive from the moment
period began to run
Kinds:
1. Acquisitive
1. Extinctive
Comparison
between
Acquisitive
Prescription and Extinctive Prescription
Acquisitive
Extinctive
Prescription
Prescription
Usurpacion
Prescription
It is the possessor One looks at the
who does the act
neglect
of
the
owner/
his
omission
Expressly vests the Statute
of
property
and limitation
that
raised a new title merely bars the
in the occupant
right of action
Important feature Important feature
is the claimant in is the owner out of
possession
possession
Who may acquire by prescription:
a. person who are capable of
acquiring property by other legal
modes
b. STATE
c. minors through guardians of
personally
Against whom prescription run:
1.
minors & incapacitated person
who have guardians
2.
absentees
who
have
administrators
3.
persons living abroad who
have administrators
4.
juridical persons except the
state with regards to property
not patrimonial in character
5.
between husbands & wife
6.
between parents & children
(during minority/insanity)
7.
between guardian & ward
(during guardianship)
8.
between co-heirs/co-owners
9.
between owner of property &
person
in
possession
of
property in concept of holder
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transfer ownership if grantor
had been the owner
through one of the modes of
transferring ownership but
there
is
vice/defect
in
capacity
of
grantor
to
transmit ownership
IN CONCEPT OF OWNER
possession
not
by
mere
tolerance
of
owner
but
adverse to that of the owner
claim that he owns the
property
PUBLIC,
PEACEFUL
&
UNINTERRUPTED
Must be known to the owner
of the thing
Acquired & maintained w/o
violence
Uninterrupted (no act of
deprivation by others) in the
enjoyment of property
Interruption
a) Natural
-through any cause, possession ceases
for more than 1 year
-if 1 year of less as if no interruption
b) Civil
-produced by judicial summons; except
void for lack of legal solemnities
plaintiff
desist
from
complaint/allow proceedings to
lapse
possessor
is
absolved
from
complaint
i.
express
or
tacit
renunciation
ii.
possession in wartime
RULES IN COMPUTATION OF
PERIOD:
a. Present possessor may tack his
possession to that of his grantor
or predecessor in interest
b. Present possessor presumed to
be in continuous possession I
intervening time unless contrary
is proved
c. First day excluded, last day
included
Tacking Period
there must be privity between
previous & present possessor
possible when there is succession of
rights
if character of possession different:
predecessor in bad faith possessor
in good faith use extraordinary
prescription
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Prescription of Actions
By lapse of time fixed by law
30 years
-action over immovables from
time possession is lost
10 years
-mortgage action
-upon written contract
-upon obligation created by law
-upon a judgement
8 years
-action to recover movables from
time possession is lost
6 years
-upon an oral contract
-upon a quasi-contract
5 years
-actions if periods are not fixed
by law
4 years
-upon injury to rights of plaintiff
-upon a quasi-delict
1 year
-for forcible entry & detainer
-for defamation
Rights
not
extinguished
by
prescription:
1. demand right of way
2. abate public /private nuisance
3. declare contract void
4. recover
property
subject
to
expressed trust
5. probate of a will
6. quiet title
XVII. TRADITION
Requisites:
1. Pre-existence of right in estate of
grantor
2. Just cause or title for the
transmission
3. Intention- of both grantor and
grantee
4. Capacity- to transmit and to
acquire
5. An act giving it in outward form,
physically, symbolically, or legally
Legal Maxim:
Non nudis pactis, sed tranditione,
dominia rerum transferentur
(Not by mere agreement but by delivery,
is ownership transferred)
Kinds of Tradition:
a. Real Tradition
b. Constructive Tradition
i. Symbolic Delivery
ii. Delivery by Public Instrument
iii. Traditio Longa Manu- long
hand; placed in the sight of
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service
labor
Lease of things
(1) Concept
XVIII. LEASE
General Characteristics of Every
Lease
(1)
Temporary duration
(2) Onerous
(3) Price is fixed according to
contract duration
Kinds of Lease
(1) Lease of thingsmovables and
immovables
no lease for more than 99 years
shall be valid
(2) Lease of work or contract of
labor
no relation of principal and agent
does not exist between them.
Existence
of
a
relation of
dependenc
e between
lessor and
lessee
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The price is
paid
in
relation to
the
duration of
the labor or
service
If the lessor
workstation
under
the
direction of
the lessee,
receiving
instructions
from
him
on
the
manner of
rendering
Contract for
a piece of
work
In proportion
to the work
accomplished
If the lessor
works
by
himself,
independently
of the lessee,
in the manner
he
deems
most
adequate for
the execution
of the work
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2008
Usufruct
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PROPERTY
Real right only by
exception:
when
registered and for
more than 1 year
Constitutor/Lessor
need not be an
owner
e.g.
sublessor,
usufruct
Lessor places and
maintains
lessee
in the enjoyment
of the thing
Use is limited to
that written in the
contract
CIVIL LAW
To
constitute
usufruct, constitutor
must be the owner
Owner merely allows
usufructuary to use
and
enjoy
the
property
Includes all possible
uses and manner of
enjoyment
of
property EXCEPT in
distinction of normal
or abnormal usufruct
Maybe
for
an
indefinite period of
time
Must be definite,
otherwise
court
may fix the same
through
the
proper action
BOTH the lessee and the usufructuary
USE and ENJOY the thing.
Lease
Commodatum
Consists
in
the Consists
in
the
cessation of the use cessation of a thing
of
a
thing
to to another but this
another but this is is
essentially
essentially onerous gratuitous
BOTH consist in the cession of the use of
a thing to another
(5) Price In Lease
Price may be in money, or in
fruits, or in some other useful
things; some other prestation
TENANCY CONTRACT- when the
price consists of a certain
percentage of the fruits obtained
from the thing. But is regarded as
having the character more of a
partnership rather than a lease.
Amount of Rent
If the parties are not able to fix
the price, or the basis for its
determination, the contract is
ABSOLUTELY VOID. If the lessee
has entered upon the possession
and enjoyment of the thing, he
will be liable for the damages for
the occupation of the thing.
(6) Period of lease
When the lease is for such time
as the lessor or lessee may
please, it is considered as on for
life, ending upon the death of the
party who would have terminated
the contract.
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weekly
Daily
Capacity of Lessee
Those who are disqualified to buy certain
things cannot lease such things. (ART.
1646, 1490,1491)
Lease of Real Estate
Every lease of real estate may be
recorded in the Registry of Property to
be binding upon 3rd persons.
Purchase of Leased Land
Where a purchaser of land at the
time of the purchase has FULL
KNOWLEDGE of the fact that the land
has been leased to a third person, he
is BOUND to respect said lease,
although it is not recorded upon the
certificate of title.
(7) Assignment of lease
Art. 1649. The lessee cannot assign the
lease without the consent of the lessor,
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PROPERTY
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(8) Sublease
Art. 1650. When in the contract of lease
of things there is no express prohibition,
the lessee may sublet the thing leased,
in whole or in part, without prejudice to
his responsibility for the performance of
the contract toward the lessor.
Assignment
of
lease
There is a transfer
to a third person of
the
rights
and
obligations arising
from
the
lease
contract
A
sale
of
the
lessees rights, and
when the lessor
gives his consent,
the original lessee
is released
Succession
by
particular title to
one contract of
lease
(i)
Merely
another
contract of lease,
where the original
lessee becomes in
turn a lessor
Even
when
the
lessor consents to
the sub-lease, the
original
lease
contract
subsists
and is binding on
the lessee
Juxtaposition of 2
leases
UP
for rents
Sublease
Effects
(1) Remedy when property is
subleased despite prohibition:
recission and damages, or
damages only.
(2) When in the contract of lease,
there
is
no
express
prohibition, the lessee may
sublet the thing leased, in
whole or in part, without
prejudice to his responsibility
for the performance of the
contract toward the lessor.
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PROPERTY
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Alteration
Art. 1661. 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.
(iii) Peaceful Possession
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PROPERTY
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(10)
Grounds for ejectment of
lessee by lessor
Termination of Lease
(1)
by the expiration of the
period;
(2)
by the total loss of the
thing;
(3) by the resolution of the right
of the
lessor, such as when the
lessor
is
usufruct
is
terminated;
(4) by the will of the purchaser or
transferee of the things;
(5) by
rescission
due
to
nonperformance
of
the
obligation of one of the
parties.
Alternative Remedies
Performance of the contract and
rescission
In either case, the aggrieved
party is entitled to such damages
but may not upon rescission of
the contract recover the damages
that are appropriate only where
the performance is demanded.
Period
If at the end of the contract the
lessee should continue enjoying
the thing leased for fifteen days
with the acquiescence of the
lessor, and unless a notice to the
contrary by either party has
previously given, it is understood
that there is an implied new
lease, not for the period of the
original contract but for the time
established in art. 1682(rural)
and 1687(urban)
When the parties have made no
agreement
and
the
tenant
remains in possession with the
acquiescence of the lessor for 15
days after the expiration of the
term, the duration of the tenancy
is governed by article 1682 and
1687.
Tacit Renewal
The fifteen-day period which
brings about a tacit renewal of
the lease, is not applicable to
successive renewals.
Judicial Ejectment
The lessor may judicially eject
the lessee for any of the following
causes:
(1)
When the period agreed
upon, or that which is fixed
for the duration of leases
under Art 1682 (rural) and
1687(urban), has expired;
Enforcement of Lease
Where
the
lessor
resumes
possession of his leased property
for its protection after the lessee
has abandoned the same, the
lessor has still the right to hold
the lessee responsible until the
termination of the lease.
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PROPERTY
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(12)
Right
leased land
of
purchaser
Right to Repurchase
The purchaser in a sale with the
right to redemption cannot make
use of the power to eject the
lessee until the end of the period
of redemption.
But when the vendor remains in
possession as a tenant, and he
fails to pay the agreed rent, he
may be evicted by the vendee
even before the period of
redemption has expired.
of
(13)
Useful improvements
good faith made by lessee.
in
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PROPERTY
CIVIL LAW
XIX. DONATION
Characteristics:
a) Unilateral obligation imposed on
the donor
b) Consensual perfected at time donor
knows of acceptance
Requisites of Donation:
(1) Consent and capacity of parties
(2) Animus donandi (causa)
(3) Delivery of thing donated
(4) Form as prescribed by law
There must be impoverishment in fact
of donors patrimony and enrichment on
part of donee.
Requirements of a donation:
1. subject matter anything of
value; present property & not
future, must not impair legitime
2. causa anything to support a
consideration:
generosity,
charity, goodwill, past service,
debt
3. capacity to donate & dispose &
accept donation
4. form depends on value of
donation
Inter
vivos
take effect
during the
lifetime of
the donor
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Mortis
causa
take effect
upon the
death
of
the donor
Inter vivos
In doubt, conveyance should be
deemed a donation inter vivos to
avoid uncertainty as to the
ownership of the property.
Where the ownership and
possession as well as
administration were turned over
to the donee but right to reap
and dispose of the fruits was
deferred until after donors
death, donation is inter vivos
General rule: Donation inter vivos
is irrevocable EXCEPT:
1. During the subsequent birth
of the donors children
2. Failure of donee to comply
which conditions imposed
3. Ingratitude of donee; and
4. Reduction of the donation by
reason of inofficiousness
Donation mortis causa
A donation mortis causa not in
the form of a will is not valid and
does not transmit any right.
If the donor reserves the right to
dispose of all the properties
purportedly donated, there is no
donation inter vivos but mortis
causa.
Kinds of Donation
A. As
1.
2.
3.
rules
Governed by the
rules
on
contracts
and
obligations with
regard
to
portions
not
provided in the
title
on
donations
ART
732
They partake of
the
nature
if
testamentary
provisions
and
are governed by
the
rules
on
Succession ART
728
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PROPERTY
CIVIL LAW
B. As to Cause or Consideration
1. Simple (Art.725)
2. Remuneratory (Art.726)
3. Onerous (Art.733)
(See Table in the appendix)
C. As
to
its
Effectivity
or
Extinguishment
1. Pure
2. Conditional (730, 731)donation
is not carried out until the day comes
but it produces effects
With a term He who donates with a
term has already disposed of the
thing donated and cannot revoke it
nor can he dispose the thing in favor
of
another
unless
the
donor
postpones execution and reserves
the right to revoke
Perfection of Donation
presumes a demandable juridical
relation. The donor can no longer
withdraw and he can be compelled to
comply.
Acceptance is necessary because
nobody is obliged to receive a benefit
against his will.
When the donation and the acceptance
are in the same instrument, signed
by both donor and donee, donation
is perfected.
After perfection, donation can only be
revoked by the consent of the donee
or by judicial decree especially when
the donation is onerous.
Mere declaration of an intention without
intent to transfer is not a donation
even if accepted.
BY
DONATION
OF
IMMOVABLES:
DONATION AND ACCEPTANCE
FORM
OF
DONATION
CONTENTS
OF
DONATION
FORM
OF
ACCEPTANCE
WHEN
ACCEPT
TO
Public document
Property
donated
is
specified and the value of
the charges which the
donee must satisfy
Same deed of donation
or in a separate public
document; if separate,
the
donor
shall
be
notified in an authentic
form and this shall be
noted
in
both
instruments
During lifetime of donor
In writing
Value of the
thing donated
>
P5,000;
otherwise, void
Requires
simultaneous
delivery
of
the
thing
or
the
document
which
represents
the
thing
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WITH
QUALIFICATI
ONS
WHO ARE
ALLOWE
D
PROPERTY
CIVIL LAW
DONOR
DONEE
ART 735: All persons who may contract ART 738; All those not specially
and dispose of their property
disqualified by law
ART 736: Donors capacity determined
at the time of the making of the
donation
ART 736: Guardians and trustees with
respect to the property entrusted to
them
ART 739: Void donations:
1) those made between persons guilty of adultery or concubinage at the time
of the donation (the declaration of nullity may be brought by the spouse of
the donor or donee and only preponderance of evidence is needed)
2) those found guilty of the same criminal offense inconsideration thereof
ART 739 (3): public officer or his wife,
descendants and ascendants by reason
of his office
ART 740: Those who cannot succeed by
will cannot be donees
ART
743:
Donations
made
to
incapacitated persons are void although
made under the quise of another
contract
ART 741: Minors may become donees
but acceptance must be made through
their parents or legal representative
ART 742: Donations made to unborn
children may be accepted by persons
who would legally represent them if
they were already born
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5.
Art. 2012
Any person who is
forbidden from receiving a donation
under Art. 739 cannot be named
beneficiary of a life insurance policy
by the person who cannot make a
donation to him.
Double Donations
Apply double sales to double donations
Who may accept (Art. 745, 747)
- donee
personally
or
through
authorized
person
- representatives of incapacitated
must make
notification and
notation
If the donor dies before he learns of the
acceptance, the donation does not take
effect, even if the acceptance is made
during the lifetime of the donor.
Form of Donations
(a) Personal property (Art. 748)
Document of donation need not be public
instrument.
When donation does not
exceed P5,000, it may be made orally or
in writing. If made orally, there must be
simultaneous
delivery.
If
no
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PROPERTY
CIVIL LAW
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not
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PROPERTY
CIVIL LAW
WHAT
MAY
DONATED:
DONATIONS
SEVERAL
JOINTLY
NOT
BE
MADETO
PERSONS
WHAT
THE
DONEE
ACQUIRES
WITH
THE
THING
OBLIGATIONS
DONOR
OF
THE
REVERSION
OBLIGATION OF DONEE TO
PAY DONORS DEBTS
IN FRAUD OF CREDITORS
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LIMITATION: he reserves in
full ownership or in usufruct,
sufficient
means
for
his
support and of all relatives
who
at
the
time
of
acceptance of the donation
are by law entitled to be
supported
EFFECT
OF
NON
RESERVATION: reduction of
the donation
LIMITATION:
The
third
person should be living at the
time of the donation
OTHERWISE:
reversion
is
void but obligations subsists
EXCEPT:
When
contrary
intention appears
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PROPERTY
CIVIL LAW
In General
(1) Donee
may
demand
actual
delivery of the thing donated.
(2) Donee is subrogated to rights of
donor in
the
property
donated.
(3) Donor not obligated to warrant
things
donated,
except
in
onerous donations in which case,
donor is
liable for eviction
up to the extent of the burden.
(4) Donor is liable for eviction or
hidden defects in case of bad
faith on his part.
Donations propter nuptias of property
subject to encumbrances are valid.
Art. 85 FC-Effect of foreclosureDonations by reason of marriage of
property subject to encumbrances shall
be valid. In case of foreclosure of the
encumbrance and the property is sold
for less than the amount of the
obligation secured, the donee shall not
be liable for the deficiency. If the
property is sold than the total amount of
said obligation, the donee shall be
entitled to the excess.
Donation to several donees jointlyno
right of accretion Except
1. donation provides otherwise
2. donation to husband and wife
jointly with right of accretion (jus
accrescendi),
unless
the
donor
provides otherwise.
Special Provisions
(1) Reservation by donor of power to
dispose (in whole or in part) or to
encumber
property
donated.
(755)
(2) Donation of naked ownership to
one donee and usufruct to
another. (756)
(3) Conventional reversion in favor of
donor or other person. (757)
(4) Payment of donors debt (758)
(a) If expressly stipulated-donee
to pay
debts
contracted
before the donation, unless
specified otherwise, but in no
case shall the donee be
responsible
for
debts
exceeding value of property
donated,
unless
clearly
intended
(b) If there is no stipulationdonee answerable only for
donors debt only in case of
donation in fraud of creditors.
Liability of the donee for the
debts of the donor should be
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PROPERTY
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Inofficious donations:
1. shall be reduced with regards to
the excess
2. action to reduce to be filed by
heirs who have right to legitimate
at time of donation
3. donees/creditors
of
deceased
donor cannot ask for reduction of
donation
4. if there are 2 or more donation:
recent ones shall be suppressed
5. if 2 or more donation at same
time
treated
equally
&
reduction is pro rata but donor
may impose preference which
must be expressly stated in
donation
Exception to rule on
intransmissibility of action with
regards to revocation due to
ingratitude:
1. personal to the donor; general
rule is heir cannot institute if
donor did not institute
2. heirs can only file in the ff cases:
a) donor
has
instituted
proceedings
but
dies
before bringing civil action
for revocation
b) donor already instituted
civil action but died, heirs
can substitute
c) donee killed donor or his
ingratitude caused
the
death of the donor
KINDS OF DONATION
Pure/Simple
a) Consideration
Merits of donee
b) law to apply/
forms
Law on donations
c) form of
acceptance
Required
d) reservation
w/regards to
personal support
& legitime
Applicable
e) warranty
against eviction
& hidden defects
In bad faith only
f) revocation
Applicable
g)
effect
of
impossible/
illegal conditions
considered
not
written
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Remuneratory
Liberality or merits of
donee or burden/
charge of past
services provided they
do not constitute
demandable debt
Law on donations
Conditional
Valuable
consideration is
imposed but value
is less than value of
thing donated
Onerous
Valuable consideration
given
Extent of burden
Required
Required
Law on obligations
imposed>oblicon
excess>donation
Required
Applicable
Applicable
Not Applicable
Applies
Applicable
considered not written
Applicable
considered not
written
Applicable
Obligation nullified
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PROPERTY
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MODES OF EXTINGUISHMENT
BIRTH OF CHILD
Ipso jure revocation, no
need for action., court
decision is merely
declaratory
Extent: portion which may
impair legitime of heirs
Property must be returned
Alienation/mortgages done
prior
to
recording
in
Register of Deeds:
If already sold or cannot
be returned the value
must be returned
If mortgaged donor may
redeem the mortgage with
right to recover from
donee
NON-FULFILLMENT OF
CONDITION
needs court action
Alienations/mortgages
imposed are void unless
registered with Register of
Deeds
Action
heirs
extends
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to
donees
INGRATITUDE
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Property to be returned
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PROPERTY
CIVIL LAW
TIME
OF
ACTION
Within 4 years
from
birth,
legitimation
and adoption
TRANSMISSIBILITY
EFFECT
Transmitted
children
descendants
death of donor
Non compliance
with condition
Within 4 years
from
non
compliance
May be transmitted to
donors
heirs
and
may
be
exercised
against donees heirs
Ingratitude
Within 1 year
after
knowledge of
the fact
Generally
not
transmitted to heirs
of donor/donee
Failure
to
reserve sufficient
means
for
support
At any time by
the donor or
relatives
entitled
to
support
Within 5 years
from death of
donor
Not transmissible
Rescission
within 4 years
from
the
perfection of
donation/
knowledge of
the donation
Transmitted
to
creditors
heirs
or
successors in interest
Property
returned/
value
(if
sold)/
redeem
mortgage
with right to
recover
Property
returned,
alienations
and
mortgages
void subject
to rights of
third person
in good faith
Property
returned but
alienations
and
mortgages
effected
before
the
notation
of
the
compliant for
revocation in
the registry
of
property
subsist
Reduced
to
the
extent
necessary to
provide
support
Donation
takes effect
on
the
lifetime
of
donor.
Reduction
only upon his
death
with
regard to the
excess
Returned for
the benefit of
creditor who
brought
action
Birth,
appearance,
adoption
Inofficiousness
for
being
in
excess of what
the donor can
give by will
Fraud
against
creditors
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to
and
upon
Transmitted
donors heirs
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2008
LIABILITY
(FRUITS)
Fruits
returned
from the filing of
the complaint
Fruits
received
after
having
failed to fulfill
condition
returned
Fruits
returned
from the filing of
the complaint
Donee entitled
Donee entitled
Fruits returned/
if
impossible
indemnify
creditor
for
damages
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SUCCESSION
CIVIL LAW
Succession
TABLE OF CONTENTS
I.
II.
III.
IV.
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Succession in General
Testamentary Succession
Legal or Intestate Succession
Provisions Common to Testamentary and Intestate Succession
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99
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SUCCESSION
CIVIL LAW
C. FORMALITIES OF WILLS
KINDS OF SUCCESSION
1. Testamentary that which results
from the designation of an heir, made
in a will executed in the form
prescribed by law. (Art. 779, CC)
2. Legal or Intestate that which takes
place by operation of law in the
absence of a valid will.
3. Mixed that which is effected partly
by will and partly by operation of law.
(Art. 780, CC)
KINDS OF HEIRS
1. Compulsory those who succeed by
force of law to some portion of the
inheritance,
in
an
amount
predetermined by law, of which they
cannot be deprived by the testator,
except by a valid disinheritance. They
succeed regardless of a will.
2. Voluntary or Testamentary those
who are instituted by the testator in
his will, to succeed to the portion of
the inheritance of which the testator
can freely dispose. They succeed by
reason of a will.
3. Legal or Intestate those who
succeed to the estate of the decedent
who dies without a valid will, or to the
portion of such estate not disposed of
by will. They succeed in the absence of
a valid will.
I. TESTAMENTARY SUCCESSION
A. CONCEPT
DEFINITION OF WILL (Art. 783, CC)
It is 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
B. TESTAMENTARY CAPACITY
TESTAMENTARY CAPACITY
1. All persons who are not expressly
prohibited by law (Art. 796, CC)
2. Eighteen (18) years old and above
(Art. 797, CC)
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KINDS OF WILLS
1. Notarial an ordinary or attested will
(Articles 804-808, CC)
2. Holographic a handwritten will (Art.
810, CC)
COMMON REQUIREMENTS TO BOTH
WILLS (Art. 804, CC)
1. In writing
2. In a language or dialect known to the
testator
REQUISITES FOR A VALID NOTARIAL
WILL
1. In writing (Art. 804, CC)
2. In a language or dialect known to the
testator (Art. 804, CC)
3. Subscribed at the end by the testator
himself or by the testators name
written by some other person in his
presence, and by his express direction
(Art. 805, CC)
*Requisite of a signature: satisfied by
a thumbprint Matias vs. Salud. However, a
cross does not. Garcia vs. Lacuesta
4. Attested and subscribed by three or
more
credible
witnesses
in
the
presence of the testator and of one
another (Art. 805, CC)
*Test of Presence: 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. Jaboneta
vs. Gustilo, 5 Phil. 541
5. Each and every page, except the last,
must be signed by the testator or by
the person requested by him to write
his name, and by the instrumental
witnesses of the will, on the left
margin. (Art. 805, CC)
*Exceptions:
a. when the will consists of only one
page
b. when the will consists of only two
pages, the first of which contains
all dispositions and is signed at
the bottom by the testator and
the witnesses, and the second
page contains only the attestation
clause duly signed at the bottom
by the witnesses. Abangan vs.
Abangan
*Note: The inadvertent failure of one
witness to affix his signature to one
2008
Page 99 of 325
SUCCESSION
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AMENDING A WILL
1. Notarial only through a codicil
2. Holographic
a. Dispositions may be added below
the signature, provided that said
dispositions are also dated and
signed, and everything is written by
the hand of the testator himself
b. Certain dispositions or additional
matter may be suppressed or
inserted provided that such is
signed by the testator and written
by the hand of the testator himself
c. Through a codicil which may either
be notarial or holographic
EFFECT OF INSERTION WRITTEN BY
ANOTHER PERSON ON THE VALIDITY OF
A HOLOGRAPHIC WILL WRITTEN BY THE
TESTATOR
When Made
Effect
After the execution of Insertion
is
the will, without the considered
not
consent of the testator
written. The validity
of the will cannot
be defeated by the
malice or caprice of
a third person.
After the execution of Will is valid.
the
will,
with
the Insertion is void.
consent of the testator
After the execution of Insertion becomes
the will, validated by part of the will.
the testator by his Entire will becomes
signature
void because it did
not comply with the
requirement that it
must
be
wholly
written
by
the
testator.
Contemporaneous
to Will is void because
the execution of the will it is not written
entirely
by
the
testator.
RULES IN CASE OF SUBSEQUENT
DISPOSITIONS
Subsequent
Effect
Disposition
Signed
Valid
Not dated
Last
disposition
is
signed and dated
Not signed
Void
Dated
Signed
Void but it does not
Not dated
affect the validity of
the other dispositions
or the will itself
BAROPS
QUALIFICATIONS OF WITNESSES TO A
NOTARIAL WILL (Arts. 820 821, CC
(SABRDC))
1. Of sound mind
2. Of the age of 18 years or more
3. Not blind, deaf or dumb
2008
SUCCESSION
CIVIL LAW
4. Intrinsic
validity
provisions
-
Testator
Filipino
Alien
As to Place
Place of
Governing Law
Execution of
the Will
Philippines
Philippine Law
(Art. 16, CC)
Outside
of 1. Law
of
the
the
country
in
Philippines
which
it
is
(Art.
815,
executed; or
CC)
2. Philippine Law
Philippines
1. Philippine Law;
(Art.
817,
or
CC)
2. Law
of
the
Country
of
which testator
is a citizen or
subject.
Outside
the 1. Law
of
the
Philippines
place
where
(Art.
816,
the
will
is
CC)
executed; or
2. Law
of
the
place
where
the
testator
resides; or
3. Law
of
the
testators
country; or
4. Philippine Law
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testamentary
JOINT WILL
A single testamentary instrument
which contains the wills of two or
more persons
jointly executed by them
either for their reciprocal benefit or
for the benefit of a third person
MUTUAL WILLS
Executed pursuant to an agreement
between two or more persons
to dispose of their property in a
particular manner
each in consideration of the other
separate wills of two persons which
are reciprocal in their provisions
RECIPROCAL WILLS
Testators name each other as
beneficiaries
under similar testamentary plans
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CIVIL LAW
E.
REVOCATION OF WILLS AND
TESTAMENTARY DISPOSITIONS
MODES OF REVOKING A WILL (Art. 830,
CC)
1. By implication of law
2. By the execution of a will, codicil or
other writing executed as provided in
the case of wills
3. By burning, tearing, canceling, or
obliterating the will with the intention
of revoking it, by the testator himself,
or by some other person in his
presence, and by his express direction
F.
ALLOWANCE
DISALLOWANCE OF WILLS
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AND
PROBATE
It is a special proceeding by which
the validity of a will may be
established.
Probate court may pass upon the
title
thereto,
but
such
determination is provisional, not
conclusive, and is subject to the
final decision in a separate action
to resolve title. Pastor vs. CA 1983
Probate of a will bars criminal
prosecution of the alleged forger of
the probated will. Mercado vs.
Santos 1938
2008
SUCCESSION
CIVIL LAW
G. INSTITUTION OF HEIRS
DEFINITION OF INSTITUTION OF HEIRS
(Art. 840, CC)
It is an act by virtue of which a
testator designates in his will
the person/s who are to succeed
him
in
his
property
and
transmissible
rights
and
obligations.
REQUISITES FOR A VALID INSTITUTION
OF HEIR (DACCVP)
1. Designation in will of person/s to
succeed
2. Will specifically assigns to such person
an inchoate share in the estate
3. The person so named has capacity to
succeed
4. The will is formally valid
5. No vice of consent is present
6. No preterition results from the effect of
such will
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SUCCESSION
CIVIL LAW
HEIR
Voluntary
Compulsory
1.
2.
3.
4.
KINDS OF INSTITUTIONS
Simple or Pure the rights to the
succession are transmitted from the
moment of the death of the decedent.
(Art. 777, CC)
Conditional may be potestative,
causal or mixed. (See Arts. 871 884)
*Disposicion Captatoria disposition
made upon the condition that the heir
shall make some provision in his will in
favor of the testator or of any other
person. This is void. (Art. 875, CC)
With a Term designation of the day
or time when the effects of the
institution of an heir shall commence
or cease. (Art. 885, CC)
Modal institution where the testator
states the following: (Art. 882, CC)
a. the object of the institution; or
b. the purpose of the application of
the property left by the testator; or
c. the charge imposed by the creator
upon the heir.
*Doctrine
of
Constructive
Compliance When without the fault
of the heir, the modal institution
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. (Art. 883, CC)
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CLASSES OF SUBSITITUTION
1. Vulgar or Simple the testator may
designate one or more person/s to
substitute the heir/s instituted in case
such heir/s should: (Art. 859, CC)
a. die before him (predecease)
b. should not wish to accept the
inheritance (renounce)
c. should be incapacitated to accept
the inheritance (incapacitated)
2. Brief or Compendious (Art. 860, CC)
a. Brief - two or more persons
designated by the testator to
substitute for only one heir.
b. Compendious One person is
designated to take the place of two
or more heirs.
3. Reciprocal If the heirs instituted in
unequal shares should be reciprocally
substituted, the substitute shall acquire
the share of the heir who dies,
renounces, or is incapacitated, unless
it clearly appears that the intention of
the testator was otherwise. If there are
more than one substitute, they shall
have
the
same
share
in
the
2008
SUCCESSION
CIVIL LAW
Surviving spouse- SS
Legimate Parents- LP
Illegitimate Parents- ILP
COMPULSORY HEIRS
If the testator is a
If the testator is an
LEGITIMATE
ILLEGITIMATE
CHILD
CHILD
1.
LC
and 1. LC and descendants
descendants
2. In default of no. 2.
ILC
and
1, LP and ascendants descendants
3. SS
3. In default of nos. 12, ILP only
4.
IC
and 4. SS
descendants
I. LEGITIMES
DEFINITION OF LEGITIME (Art. 886, CC)
It is that part of the testators
property which he cannot dispose
of
because the law has reserved it for
his compulsory heirs
CLASSES OF COMPULSORY HEIRS (Art.
887, CC)
1. Primary those who have precedence
over and exclude other compulsory
heirs
a. Legitimate children and legitimate
descendants with respect to their
legitimate parents and ascendants
2. Secondary those who succeed only
in the absence of the primary
compulsory heirs
a. Legitimate parents and legitimate
ascendants with respect to their
legitimate children and descendants
b. Illegitimate parents with respect to
their illegitimate children
3. Concurring those who succeed
together with the primary or the
secondary compulsory heirs
a. Widow or widower (legitimate)
b. Illegitimate children and illegitimate
descendants
Legitmate children- LC
Illegitimate children- ILC
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SUCCESSION
SURVIVING
REL.
CIVIL LAW
SUMMARY OF LEGITIMES OF COMPULSORY HEIRS
LC &
SS
ILC
LP &
DESCENDANTS
ILP
ASCENDANT
S
LC alone
1 LC,
SS
LC, SS
(divided by
# of children)
(divided by
# of children)
LC, ILC
1 LC, SS,
ILC
(preferred)
of the share of 1
LC
2 or more
LC,
SS,
ILC
LP alone
(divided by
# of children)
of the share of 1
LC
LP,
ILC
LP, SS
LP, SS,
ILC
of the share of 1
LC
1/8
ILC alone
ILC,
SS
SS alone
(divided by # of
children)
1/3
1/3 (divided by #
of children)
or 1/3 if
marriage in
articulo mortis
ILP alone
ILP, SS
Adopter
ILC, SS
1/3
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1/3
1/3
(adopter)
2008
SUCCESSION
CIVIL LAW
B
E
(Reservatario)
G (Reservista)
H
(Prepositus)
J. DISINHERITANCE
DEFINITION OF DISINHERITANCE (Art.
915, CC)
It is the act by which the testator
for just cause
deprives a compulsory heir of his
right to the legitime.
REQUISITES FOR A VALID
DISINHERITANCE
1. Heir disinherited must be designated
by name or in such a manner as to
leave no room for doubt as to who is
intended to be disinherited.
2. It must be for a cause designated by
law.
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DISINHERITANCE
Guilty/convicted of
attempt against life of
testator/spouse/
ascendant/descendant
Accused
testator/decedent of
crime punishable by
imprisonment of 6
years or more, found
groundless, false
Causes
testator/decedent to
make will or change
one by fraud,
violence, intimidation,
or undue influence
Unjustified refusal to
support testator
Convicted of adultery
or concubinage with
spouse of
testator/decedent
Maltreatment of
testator by word and
deed
Leading a
dishonorable or
disgraceful life
Conviction of crime
which carries penalty
of civil interdiction
Abandonment of
children or inducing
children to live
corrupt and immoral
life or attempted
against virtue
Loss of parental
authority
Attempt by one
parent against life of
the other UNLESS
there is reconciliation
between parents
Spouses given cause
BAROPS
2008
919
920
921
10
32
*
*
*
*
*
*
Page 107 of 325
SUCCESSION
CIVIL LAW
REVOCATION OF DISINHERITANCE
1. Reconciliation
2. Subsequent
institution
of
the
disinherited heir
3. Nullity of the will which contains the
disinheritance
*Note: The moment the testator uses one of
the acts of unworthiness as a cause for
disinheritance, he thereby submits it to the
rules on disinheritance. Thus, reconciliation
renders the disinheritance ineffective.
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favor
of
the
legatee/devisee
onerously
5. Not belonging to
the testator at the
time
the
will
is
executed but he has
ordered that the thing
be acquired in order
that it be given to the
legatee/devisee.
6. Not belonging to
the testator at the
time
the
will
is
executed
and
the
testator erroneously
believed
that
the
thing pertained to
him.
7. Not belonging to
the testator at the
time
the
will
is
executed
but
afterwards it becomes
his by whatever title.
8. Already belonged
to
the
legatee/devisee
at
the
time
of
the
execution of the will
even though another
person
may
have
interest therein
9. Already belonged
to
the
legatee/devisee
at
the
time
of
the
execution of the will
even though it may
have
been
subsequently
alienated by him.
10.
Testator had
knowledge that the
thing
bequeathed
belonged to a third
person
and
the
legatee/devisee
acquired the property
gratuitously after the
execution of the will.
11.
Testator had
knowledge that the
thing
bequeathed
belonged to a third
person
and
the
legatee/devisee
acquired the property
by onerous title.
estate.
Effective
Void
Effective
Ineffective
Ineffective
Legatee/devisee
claim
nothing
virtue
of
legacy/devise
can
by
the
Legatee/devisee can
demand
reimbursement from
the heir or estate.
BAROPS
2008
SUCCESSION
1.
2.
3.
4.
(LIPO)
Legitime
of
compulsory
heirs
Donations Inter
vivos
Preferential
legacies
or
devises
All
Other
legacies
or
devises pro rata
CIVIL LAW
(RPSESO)
1. Remuneratory
legacy/devise
2. Preferential
legacy/devise
3. Legacy for Support
4. Legacy
for
Education
5. Legacy/devise
of
Specific,
determinate thing
which forms a part
of the estate
6. All Others pro rata
Application:
1. When there are no
compulsory
heirs
and
the
entire
estate
is
distributed by the
testator as legacies
or devises; or
2. When there are
compulsory
heirs
but their legitime
has already been
provided for by the
testator and there
are no donations
inter vivos.
*Art. 950 governs
when the question
of
reduction
is
exclusively
among
legatees
and
devisees
themselves.
II.
LEGAL
SUCCESSION
Application:
1. When
the
reduction
is
necessary
to
preserve
the
legitime
of
compulsory
heirs
from
impairment
whether
there
are
donations
inter vivos or
not; or
2. When, although,
the legitime has
been preserved
by the testator
himself
there
are
donations
inter vivos.
*Art.
911
governs
when
there
is
a
conflict between
compulsory
heirs and the
devisees
and
legatees.
*Note: In case of reduction, the inverse order
of payment should be followed.
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OR
INTESTATE
the
heir
does
something
3. Incapacity
or
Predecease
2008
SUCCESSION
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*Notes:
-
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RIGHT OF REPRESENTATION IN
TESTAMENTARY SUCCESSION
1. When a compulsory heir in the direct
descending line had predeceased the
testator and was survived by his
children or descendants.
2. When a compulsory heir in the direct
descending line is excluded from the
inheritance due to incapacity or
unworthiness and he has children or
descendants.
3. When a compulsory heir in the direct
descending line is disinherited and he
has
children
or
descendants;
representation
covers
only
the
legitime.
4. A legatee or devisee who died afther
the death of the testator may be
represented by his heirs.
RIGHT OF REPRESENTATION IN
INTESTATE SUCCESSION
1. When a legal heir in the direct
descending line had predeceased the
decedent and was survived by his
children or descendants.
2. When a legal heir in the direct
descending line is excluded from the
inheritance due to incapacity or
unworthiness and he has children or
descendants.
3. When
brothers
or
sisters
had
predeceased the decedent and they
had children or descendants.
4. When illegitimate children represent
their deceased illegitimate parents in
the estate of their grandparents.
5. When nephews and nieces inherit
together with their uncles and aunts in
representation
of
their
deceased
parents who are brothers or sisters of
said uncles and aunts.
2008
SUCCESSION
CIVIL LAW
ORDER OF LEGAL OR INTESTATE SUCCESSION
1
2
3
4
5
6
7
DECEDENT IS A
LEGITIMATE CHILD
LC and
Legitimate descendants
LP and
Legitimate ascendants
ILC and
Illegitimate descendants
DECEDENT IS AN
ILLEGITIMATE CHILD
LC and
Legitimate descendants
ILC and
Illegitimate descendants
ILP
SS
Legitimate siblings,
Nephews,
Nieces
Legitimate collateral relatives
within the 5th degree
State
SS
Illegitimate siblings,
Nephews,
Nieces
State
Intestate Heir
LC and
Legitimate descendants
ILC
and Descendants
LP and
Legitimate ascendants
ILP
SS
Siblings,
Nephews
Nieces
Other collaterals within
5th degree
State
EXCLUDED BY
CONCURS WITH
Ascendants,
Collaterals and
State
ILP,
Collaterals and
State
Collaterals and
State
Collaterals and
State
Collaterals other than
siblings, nephews and
nieces
No one
SS and
ILC
No one
SS
LC and
LP
ILC and
SS
SS
No one
SS
Everyone
No one
LC
LC and ILC
1
TOTAL
1
2
ONE LEGITIMATE CHILD AND SURVIVING SPOUSE
Intestate Heir
SHARE AS LEGITIME
LC
SS
TOTAL
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SHARE AS FREE
DISPOSAL
TOTAL INTESTATE
SHARE
2008
SUCCESSION
CIVIL LAW
3
LEGITIMATE CHILDREN AND SURVIVING SPOUSE
SHARE AS FREE
TOTAL INTESTATE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
SHARE
LC
Remaining portion of
Whole estate divided
estate after paying
equally between total
legitimes
# of children plus the
SS
SS
Legitimes to be
# of children plus the
divided equally
SS (see above)
Same as share of 1 LC
between total # of
children plus the SS
TOTAL
Varies on no. of
Varies on no. of
1
children
children
4
LEGITIMATE CHILDREN AND ILLEGITIMATE CHILDREN
SHARE AS FREE
TOTAL INTESTATE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
SHARE
LC
Remaining portion of
Whole estate divided
estate after paying
by the ratio of 2:1 for
legitimes
each LC as compared
to the ILC
ILC
share of 1 LC
Legitimes to be
1 for each ILC
divided by the ratio of provided that legitimes
2 for each LC, 1 for
wouldnt be impaired
each ILC
TOTAL
Varies on # of children Varies on # of children
1
5
ONE LEGITIMATE CHILD, ILLEGITIMATE CHILD, AND SURVIVING SPOUSE
SHARE AS LEGITIME
SHARE AS FREE
TOTAL INTESTATE
Intestate Heir
DISPOSAL
SHARE
LC
ILC
share of 1 LC or
SS
Remaining portion of
estate after paying
legitimes to be divided
by the ratio of 2:1 for
each LC and each
ILC, respectively
1 for each ILC (see
above)
Same share as a LC
TOTAL
Varies depending on #
of ILC
Varies depending on #
of ILC
6
LEGITIMATE CHILDREN, ILLEGITIMATE CHILDREN AND SURVIVING SPOUSE
SHARE AS FREE
TOTAL INTESTATE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
SHARE
LC
Remaining portion of
Whole estate divided
estate, if any after
by the ratio of 2:1 for
paying legitimes to be
each LC and ILC
divided by the ratio of
respectively
2 for each LC
ILC
share of each LC
1 for each ILC (see
1 for each ILC (see
above)
above)
SS
Same share as one
Same share as a LC,
Same share as a LC,
LC
provided legitimes
provided legitimes
are not impaired
are not impaired
TOTAL
Varies depending on
Varies depending on
1
no. of ILC
no. of ILC
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SUCCESSION
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Intestate Heir
LP
TOTAL
7
LEGITIMATE PARENTS ALONE
SHARE AS FREE
SHARE AS LEGITIME
DISPOSAL
TOTAL INTESTATE
SHARE
1
1
8
LEGITIMATE PARENTS AND ILLEGITIMATE CHILDREN
In
SHARE AS LEGITIME
testate Heir
LP
ILC
TOTAL
SHARE AS FREE
DISPOSAL
TOTAL INTESTATE
SHARE
9
LEGITIMATE PARENTS AND SURVIVING SPOUSE
SHARE AS FREE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
LP
SS
TOTAL
TOTAL INTESTATE
SHARE
10
LEGITIMATE PARENTS, SURVIVING SPOUSE AND ILLEGITIMATE CHILDREN
SHARE AS FREE
TOTAL INTESTATE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
SHARE
LP
SS
1/8
1/8
ILC
TOTAL
7/8
1/8
1
Intestate Heir
ILC alone
TOTAL
11
ILLEGITIMATE CHILDREN ALONE
SHARE AS FREE
SHARE AS LEGITIME
DISPOSAL
TOTAL INTESTATE
SHARE
1
1
12
ILLEGITIMATE CHILDREN AND SURVIVING SPOUSE
SHARE AS FREE
TOTAL INTESTATE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
SHARE
ILC
1/3
1/6
SS
1/3
1/6
TOTAL
2/3
1/3
1
Intestate Heir
SS
TOTAL
13
SURVIVING SPOUSE
SHARE AS FREE
SHARE AS LEGITIME
DISPOSAL
or 1/3
or 1/3
or 1/3
or 1/3
TOTAL INTESTATE
SHARE
1
1
14
ILLEGITIMATE PARENTS ALONE
Intestate Heir
SHARE AS LEGITIME
SHARE AS FREE
DISPOSAL
TOTAL INTESTATE
SHARE
ILP
TOTAL
1
1
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SUCCESSION
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15
ILLEGITIMATE PARENTS AND SURVIVING SPOUSE
SHARE AS FREE
TOTAL INTESTATE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
SHARE
ILP
SS
TOTAL
Intestate Heir
Siblings, nephews,
nieces
TOTAL
16
SIBLINGS, NEPHEWS AND NIECES ALONE
(SPECIAL KIND OF COLLATERAL RELATIVES)
SHARE AS FREE
SHARE AS LEGITIME
DISPOSAL
TOTAL INTESTATE
SHARE
1
17
SURVIVING SPOUSE, SIBLINGS, NEPHEWS AND NIECES
SHARE AS FREE
TOTAL INTESTATE
SHARE AS LEGITIME
Intestate Heir
DISPOSAL
SHARE
SS
Siblings, nephews,
nieces
TOTAL
1
ORDER OF CONCURRENCE IN THE CASE OF AN ADOPTED CHILD (Art. 190, FC)
SURVIVORS
SHARE
LC, ILC, SS
As in the case of ordinary intestate succession
LP or ascendants or ILP Adopter
SS
LP or ascendants
Adopter
ILC or descendants
LP or ascendants
1/3
Adopter
SS
1/3
ILC or descendants
1/3
Adopter alone
Entire estate
Collateral blood relatives
As in the case of ordinary intestate succession
III. PROVISIONS
SUCCESSIONS
COMMON
TO
TESTAMENTARY
AND
INTESTATE
A. ACCRETION
-
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CIVIL LAW
TESTAMENTARY SUCCESSION
LEGITIME
FREE PORTION
Representat'n
Accretion
Intestate Succession
Intestate Succession
Incapacity
Representat'n
Intestate Succession
Disinheritance
Representat'n
Intestate Succession
Repudiation
Intestate Succession
Accretion
Intestate Succession
Accretion
Representat'n
Intestate Succession
B. CAPACITY TO SUCCEED
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INTESTATE
SUCCESSION
Representat'n
Intestate Succession
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Accretion
f. Physician,
surgeon,
nurse,
health officer or druggist who
took care of the testator during
his last illness.
2. BASED
ON
MORALITY
OR
PUBLIC POLICY (Art. 739, CC)
a. 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.
b. Those made in consideration of
a crime of which both the
testator and the beneficiary
have been found guilty.
c. Those made in favor of a public
officer
or
his
spouse,
descendants and ascendants,
by reason of his public office.
3. BASED
ON
ACTS
OF
UNWORTHINESS (Art. 1032,
CC)
See
table
under
disinheritance
PARDON OF ACTS OF UNWORTHINESS
EXPRESS
IMPLIED
Made
by
the Effected when the
execution
of
a testator makes a
document or any will instituting the
writing in which the unworthy heir with
decedent condones knowledge of the
the
cause
of cause of incapacity
incapacity
Cannot be revoked
Revoked when the
testator revokes the
will
or
the
institution
2008
SUCCESSION
CIVIL LAW
C.
ACCEPTANCE
AND
REPUDIATION OF INHERITANCE
CHARACTERISTICS VIR (Articles
1041 1042, 1056, CC)
1. Voluntary and free
2. Irrevocable except if there is
vitiation of consent or an unknown
will appears
3. Retroactive
REQUISITES (Art. 1043, CC)
1. certainty of death of the decedent
2. certainty of the right to the
inheritance
ACCEPTANCE VS. REPUDIATION
1. Acceptance
involves
the
confirmation of transmission of
successional
rights,
while
repudiation
renders
such
transmission ineffective.
2. Repudiation is equivalent to an act
of disposition and alienation.
3. The
publicity
required
for
repudiation is necessary for the
protection of other heirs and also
of creditors.
FORMS OF ACCEPTANCE (Articles
1049 1050, CC)
1. Express Acceptance one made
in a public or private document.
2. Tacit Acceptance one resulting
from acts by which the intention to
accept is necessarily implied or
from acts which one would have no
right to do except in the capacity of
an heir. Examples would be when
the heir sells, donates or assigns
his right, when the heir demands
partition of the inheritance, when
the heir alienates some objects of
the inheritance, etc.
FORMS OF REPUDIATION (Art. 1051,
CC)
1. in
a
public
instrument
acknowledged before a notary
public; or
2. in an authentic document
equivalent of an indubitable writing
or a writing whose authenticity is
admitted or proved; or
3. by petition presented to the court
having
jurisdiction
over
the
testamentary
or
intestate
proceeding
HEIRS IN TWO CAPACITIES (Art.
1055, CC)
If a person is called to the
same inheritance as an heir by
will and by law and he
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1.
2.
3.
4.
CONCEPT OF COLLATION
To collate is to bring back or to
return to the hereditary mass
in fact or by fiction
property which came from the
estate of the decedent, during
his lifetime by donation or other
gratuitous title
but which the law considers as
an
advance
from
the
inheritance.
It is the act by virtue of which,
the
compulsory
heir
who
concurs with other compulsory
heirs in the inheritance bring
back to the common hereditary
mass
the property which they may
have received from the testator
so that a division may be
effected according to law and
the will of the testator.
OPERATIONS RELATED TO
COLLATION
Collation adding to the mass of
the hereditary estate the value of
the
donation
or
gratuitous
disposition.
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).
Reduction determining to what
extent the donation will remain
and to what extent it is excessive
or inofficious.
Restitution return or payment
of the excess to the mass of
hereditary estate.
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SUCCESSION
CIVIL LAW
E.
PARTITION
AND
DISTRIBUITON
OF
ESTATE
(Articles 1078 1105, CC)
CONCEPT OF PARTITION (Art. 1079,
CC)
It is the separation, division
and assignment
of a thing held in common
among those to whom it may
belong.
The thing itself or its value may
be divided.
WHO MAY EFFECT PARTITION
1. decedent, during his lifetime by an
act inter vivos or by will
2. heirs
3. competent court
4. third person designated by the
decedent
WHO CAN DEMAND PARTITION
1. compulsory heir
2. voluntary heir
3. legatee or devisee
4. any person who has acquired
interest in the estate
WHEN PARTITION CANNOT BE
DEMANDED PAPU
1. when expressly Prohibited by the
testator 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
4. when to partition the estate would
render it Unserviceable for the use
for which it is intended
PROHIBITION TO PARTITION
1. The prohibition to partition for a
period not exceeding 20 years can
be imposed on the legitime.
2. If the prohibition to the partition is
for more than 20 years, the excess
is void.
3. Even if a prohibition is imposed,
the heirs by mutual agreement can
still make the partition.
PARTITION INTER VIVOS (Art. 1080,
CC)
It is one that merely allocates
specific items or pieces of
property on the basis of the
pro-indiviso shares fixed by law
or given under the will to heirs
or successors.
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EFFECTS OF INCLUSION OF
INTRUDER IN PARTITION
1. Between a true heir and several
mistaken heirs partition is void.
2. Between several true heirs and a
mistaken heir transmission to
mistaken heir is void
3. Through error or mistake, share of
true heir is allotted to mistaken
heir partition shall not be
rescinded unless there is bad faith
or fraud on the part of the other
persons interested, but the latter
shall be proportionately obliged to
pay the true heir of his share. The
partition with respect to the
mistaken heir is void.
A VOID WILL MAY BE A VALID
PARTITION
1. If the will was in fact a partition
2. If the beneficiaries of the void will
were legal heirs
IMPORTANT PERIODS TO REMEMBER
1 month or Testator, if publicly known
less
before to be insane, burden of
making a will proof is on the one
claiming validity of the
will
20 years
Maximum period testator
can prohibit alienation of
dispositions
5 years from To
claim
property
delivery
to escheated to the State
the State
1 month
To report knowledge of
violent death of decedent
lest he be considered
unworthy
5 years from Action for declaration of
the
time incapacity & for recovery
disqualified
of the inheritance, devise
person took or legacy
possession
30 days from Must
signify
issuance
of acceptance/repudiation
order
of otherwise,
deemed
distribution
accepted
1 month form Right
to
repurchase
written notice hereditary rights sold to a
of sale
stranger by a co-heir
10 years
To enforce warranty of
title/quality of property
adjudicated to co-heir
from the time right of
action accrues
5 years from To enforce warranty of
partition
solvency of debtor of the
estate
at
the
time
partition is made
4 years form Action for rescission of
partition
partition on account of
lesion
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Suggested Answer:
(a)
The compulsory heirs are the 2
legitimate children and the 2 illegitimate
children. The parents are excluded by the
legitimate children, while the brothers are
not compulsory heirs at all.
Their respective legitimes are:
1.
The legitime of the 2 legitimate
children is of the estate (P500,000) to
be divided between them equally, or
P250,000 each.
2.
The legitime of each illegitimate
child is the legitime of each legitimate
child or P125,000.
Since the total legitimes of the compulsory
heirs is P750,000, the balance of
P250,000 is the free portion.
(b)
The intestate heirs are the 2
legitimate children and the 2 illegitimate
children. In intestacy, the estate of the
decedent is divided among the legitimate
and illegitimate children such that the
share of each illegitimate child is the
share of each legitimate child.
Their shares are:
1.
For each legitimate child:
P333,333.33
2.
For each illegitimate child:
P166,666.66
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121
121
122
128
141
Title 2. Contracts
I. General Provisions
II. Essential Requisites of a Contract
III. Form of Contracts
IV. Reformation of Instruments
V. Interpretation of Contracts
VI. Rescissible Contracts
VII. Voidable Contracts
VIII. Unenforceable Contracts
IX. Void or Inexistent Contracts
148
148
149
155
157
158
159
161
162
163
166
Title 4. Estoppel
166
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II. Sources (Art. 1157)
TITLE I: OBLIGATIONS
Chapter I: General Provisions
I. Concept
Definition
Art. 1156, NCC
An obligation is a juridical necessity to give, to
do or not to do.
The legal relation established between one
party and another, whereby the latter is
bound to the fulfillment of a prestation which
the former may demand of him. (Manresa)
Elements
Active subject (obligee/ creditor)
- the one in whose favor the obligation is
constituted
- the person who is entitled to demand
Passive subject (obligor / debtor)
- the one bound to the fulfillment
- the person who has the duty of giving,
doing or not doing
Prestation (object)
- the conduct which has to be observed by
the debtor/obligor
- duties of the obligor
Requisites:
1. it must be Licit
2. it must be Possible, physically and
judicially
3. it must be Determinate or
determinable; and
4. it must have a Possible equivalent in
money
Vinculum juris
(efficient cause; juridical or legal tie)
that which binds or connects the parties to
the obligation. This can be easily known
by knowing the sources of obligations. (de
Leon
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General Rule
Obligations derived from law are not
presumed; only those expressly determined in
this 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
this Book. (Article 1158)
*Those imposed by the law itself.
CONTRACTS
Definition
A contract is a meeting of minds between two
persons whereby one binds himself, with
respect to the other, to give something or to
render some service (1305)
General Rule
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 and
Public policy (1306)
Contracts as force of law between
parties
obligations arising from contracts have the
force of law between the contracting
parties and should be complied with in
good faith (1159)
QUASI-CONTRACTS (LoVe yoU)
Law
Contracts
Quasi-contracts
Delicts
Quasi-delicts
Natural Obligations
(Art. 1423)
Based 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 the
retention of what
has been delivered
or rendered by
reason thereof
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Definition
It is the juridical relation resulting from lawful,
voluntary, and unilateral acts by virtue of
which the parties become bound to each other
to the end that no one shall be unjustly
enriched or benefited at the expense of
another (2142)
Lawful
Voluntary
Unilateral
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Distinguishing it from
crimes
Differentiating it from
quasi-delict, which are
based
on
fault
and
negligence
Distinguishing it from
contract which is based
on agreement
CIVIL LAW
Governing Rules
Obligations derived from quasi-delicts shall
be governed by the provisions of Chapter
2, Title XVII of this Book, and by special
laws (1162)
Title XVIII on damages
Articles 19-36 on human relations
1. Negotiorum Gestio
This takes place when a person voluntarily
takes charge of anothers abandoned
business or property without the owners
authority (Article 2144)
This juridical relation does not arise in
either of these instances:
a. When the property or business
is not neglected or abandoned
b. If in fact the manager has been
tacitly authorized by the owner
2. Solutio Indebiti
This takes place when something is
received when there is no right to demand
it, and it was unduly delivered thru
mistake (2154)
Specific/
determinate
thing
It is identified by
its individuality;
hence, it cannot
be substituted
with another
although the
intended
substitute is of
the same kind
and quality.
title,
on
Human
It is identified only
by its specie. The
debtor can give
anything of the same
class as long as it is
of the same kind.
Creditor cannot
demand a thing of
superior quality;
neither can the
debtor deliver a
thing of inferior
quality.
*Limited Generic thing when the generic
objects are confined to a particular class, e.g.,
an obligation to deliver one of my horses
(Tolentino)
Specific/ Determinate Thing
Duties of the obligor:
QUASI-DELICTS
Definition
An act or omission with fault or negligence
causing damage to another; not a crime nor
contract
Article 2176, New Civil Code
Whoever by act or omission causes damage to
another, there being fault or negligence, is
obliged to pay for the damage done. Such
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OBLIGATION TO DO:
To do it (1167)
To shoulder the cost if someone else does
it (1167)
To undo what has been poorly done
(1167)
To pay damages (1170-1172, 2201-2202)
Right pertaining to
a person over a
specific
thing,
without a passive
subject individually
determined against
whom such right
may be personally
enforced
Rights of a Creditor
Specific
To compel
specific
performance
To recover
damages in case
of breach of the
obligation,
exclusive or in
addition to
specific
performance
Entitlement to
damages in case of
breach of
obligation
Generic Thing
Personal Right
Before delivery
Jus ad rem/ jus in
personam
a
right enforceable
only
against
a
definite
passive
subject,
the
debtor
Right pertaining to
the
person
to
demand
from
another,
as
a
definite
passive
subject,
the
fulfillment
of
a
prestation to give,
to do or not to do
fruits, interests
from the time the
obligation to
deliver arises.
Generic
To ask for
performance of the
obligation
To ask that the
obligation be
complied with at
the expense of the
debtor
To recover
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CIVIL LAW
FRAUD
*Responsibility
arising
from
fraud
is
demandable in all obligations (fraud in the
performance)
*Waiver of action for future fraud is void for
being contrary to law and public policy (Art.
1171) because the advance renunciation of
the creditor would practically leave the
obligation without effect.
*Past fraud can be renounced. The fraud
referred to is fraud in Article 1170, which is
the malice or bad faith in the performance of
the obligation.
Kinds of Fraud
Fraud in the
Performance
(Art. 1170)
Present
during
the
performance
of
a
preexisting
obligation
Purpose
is
to evade the
normal
fulfillment
of
the
obligation
Results
in
the
breach
of
an
obligation
Gives rise to
a right in
favor of the
creditor
to
recover
damages
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Incidental
Fraud (dolo
incidente)
(Art. 1344)
Purpose is
to
secure
the
consent of
another to
enter into
the
contract
Purpose is
to
secure
the consent
of the other
party
but
the
fraud
was not the
principal
inducement
in
making
the contract
Does
not
result in the
vitiation of
consent
Results in
vitiation of
consent;
voidable
contract
Gives rise
to a right
of
an
innocent
party
to
annul
the
contract
Present
during the
perfection
of
a
contract
Gives
rise
to a right of
an innocent
party
to
claim
for
damages
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Negligence
There is no deliberate
intention to cause
damage.
Liability may be
mitigated.
Waiver for future
negligence may be
allowed in certain
cases:
a) gross can never
be excused in
advance; against
public policy
b) simple may be
excused in certain
cases
Diligence Required
1. That agreed upon by the parties
2. In the absence of stipulation, that required
by law in the particular case
3. If both the contract and law are silent,
diligence of a good father of a family
*Deligence of a Good Father of a Family:
That reasonable diligence which an
ordinary prudent person would have had
under the same circumstances.
Test of Negligence
Did the defendant in doing the alleged
negligent act use the reasonable care and
caution which an ordinary and prudent person
would have used in the same situation? If
not, then he is guilty of negligence.
(Mandarin Villa, Inc. v. CA, 257 SCRA
538, 1996)
The rule for measuring degree of care and
vigilance is dependent upon the circumstances
in which a person finds himself situated.
(Cusi v. Phil. National Railways, 90 SCRA
357, 1979)
Kinds of Culpa
1. Culpa Aquiliana (quasi-delict) wrong or
negligence committed independent of
contract and without criminal intent
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CIVIL LAW
2. Mora Accipiendi
There is a delay on the part of the creditor to
accept the performance of the obligation
Requisites:
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.
3. Creditor refuses the performance without
just cause.
Effects when these elements are present:
1. The responsibility of debtor is reduced to
fraud and gross negligence.
2. The debtor is exempted from risk of loss
of thing or the creditor bears risk of loss.
3. The expenses incurred by the debtor for
the preservation of the thing after the
mora shall be chargeable to the creditor.
4. If the obligation bears interest, the debtor
does not have to pay from time of delay.
5. The creditor is liable for damages.
6. The debtor may relieve himself of
obligation by consigning the thing.
Kinds of delay
3. Compensatio Morae
1. Mora solvendi
2. Mora accipiendi
3. Compensatio morae the delay of the
obligors in reciprocal obligations
1. Mora Solvendi
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Unilateral
Obligations
General Rule:
No demand no
delay. The mere
expiration of the
period fixed by the
parties is not
enough in order
that the debtor
may incur in delay.
Exception:
when the
obligation or law
expressly
declares
when time is of the
essence in the
contract
when the demand
would be useless
when the debtor
acknowledged
2008
Reciprocal
Obligations
One party incurs in
delay from the
moment the other
party fulfills his
obligation, while
he himself does
not comply or is
not ready to
comply in a proper
manner with what
is incumbent upon
him. The general
rule is that
fulfillment by both
parties should be
simultaneous.
When different
dates for the
performance of
obligation is fixed
by the parties.
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those
which
are
uncommon and which the contracting
parties
could
not
have
reasonably
foreseen. (see 1680)
General Rule
Except in cases expressly specified by law, or
when it is otherwise declared by stipulation, or
when the nature of the obligations requires
assumption of risk, no person shall be
responsible for those events which, could not
be foreseen, or which though foreseeable, are
inevitable.
*When a debtor is unable to fulfill his
obligation because of fortuitous events or
force majeure, his obligation to comply is
extinguished
subject
to
the
following
exceptions:
Definition
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CIVIL LAW
Accion Pauliana
By the
a.
b.
c.
parties or subject
Unilateral or Bilateral
Individual or Collective
Joint or Solidary
By the
a.
b.
c.
d.
e.
f.
g.
Definition
Rescission, which involves the right of the
creditor to attack or impugn by means of a
rescissory action any act of the debtor which
is in fraud and to the prejudice of his rights as
creditor.
Requisites
1. There is a credit in favor of plaintiff
2. The debtor has performed an act
subsequent to the contract, giving
advantage to other persons
3. The creditor has no other legal remedy
4. The debtor's acts are fraudulent
5. The creditor is prejudiced by the debtor's
act which are in favor of 3rd parties and
rescission will benefit the creditor
PURE OBLIGATION
PRIMARY CLASSIFICATION
(PaPA, Just Dont Preach)
1. Pure and conditional obligations (11791192)
2. Obligations with a Period (1193-1198)
3. Alternative obligations (1199-1206)
4. Joint and solidary obligations (1207-1222)
5. Divisible and indivisible obligations (12231225)
6. Obligations with a Penal clause (12261230)
SECONDARY CLASSIFICATION
(U R D PoLiCe)
1.
2.
3.
4.
5.
6.
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CIVIL LAW
which
RESOLUTORY CONDITION
(Condition subsequent)
It causes the extinguishment or loss of rights
already acquired upon the fulfillment of the
condition, that is, the happening of the event
which constitutes the condition.
In other
words, the fulfillment of which will extinguish
an obligation (or right) already existing.
Suspensive
When it is fulfilled,
the obligation
arises.
When it takes
place,
the tie of law
(juridical or legal
tie) does not
appear
Until it takes place,
the existence of
the obligation is a
mere hope
Effect:
The acquisition of
rights
Classification of Conditions
1. As to effect
a. Suspensive
b. Resolutory
2. As to form
a. Express the condition is clearly
stated
b. Implied the condition is merely
inferred
Resolutory
The obligation is
extinguished.
The tie of law is
consolidated
3. As to possibility
a. Possible
b. Impossible
(Manresa)
4. As
a.
b.
c.
POTESTATIVE CONDITION
(facultative condition)
to cause or origin
Potestative
Casual
Mixed
5. As to mode
a. Positive the condition consists in the
performance of an act (1184)
b. Negative the condition consists in the
omission of an act
6. As to numbers
a. Conjunctive there are several
conditions and all must be fulfilled
b. Disjunctive there are several
conditions and only one or some of
them must be fulfilled
7. As to divisibility
a. Divisible the condition is susceptible
of partial performance
b. Indivisible the condition is not
susceptible of partial performance
Suspensive and Resolutory (1179)
SUSPENSIVE CONDITION
(Condition precedent or condition antecedent)
It suspends the acquisition of rights until the
conditions are fulfilled; that is, until the
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Suspensive
condition
Depends upon the
will of the debtor
The condition and
obligation are void
because
the
validity
and
compliance
are
left to the will of
the debtor and it
cannot, therefore,
be
legally
demanded as it
will
cause
the
debtor
not
to
fulfill
the
condition
to
escape liability.
Resolutory
condition
The condition and
obligation are still
valid because the
debtor is interested
in the fulfillment of
a condition which
causes
the
extinguishment or
loss
of
rights
already
acquired
by the creditor.
CIVIL LAW
5. in case of conditions
impossible thing
condition is void.
Depends upon the
will of the creditor
The condition and
obligation
are
valid because the
creditor
is
interested in the
fulfillment of the
obligation as it
will benefit him.
not
to
POSITIVE CONDITION
(suspensive)
Requisites
1. The condition is suspensive;
2. The
obligor
actually
prevents
fulfillment of the condition; and
3. He acts voluntarily.
the
pre-existing obligation
divisible obligations
simple or remuneratory donations
testamentary dispositions
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an
Effect
CASUAL CONDITION
1.
2.
3.
4.
do
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CIVIL LAW
Rules
DETERIORATION
Rules
1. When the thing deteriorates without the
debtors fault, the creditor will suffer the
deterioration of impairment.
2. When the thing deteriorates with the
debtors fault, the creditor may choose
between:
a. Rescission
(cancellation)
of
the
obligation with indemnity for damages,
or
b. Fulfillment of the obligation also with
damages
IMPROVEMENT
Rules
Of the creditor
He may take or
bring
appropriate
actions
for
the
preservation of his
right, as the debtor
may
render
nugatory
the
obligation upon the
happening of the
condition.
Of the debtor
He is entitled to
recover what he
has
paid
by
mistake prior to
the happening og
the
suspensive
condition.
according
to
the
UNILATERAL OBLIGATION
It is when only one party is obliged to comply
with a prestation.
Kinds of loss
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BILATERAL OBLIGATION
It is when both parties are mutually bound to
each other making them both the debtors and
creditors of each other.
It may be:
reciprocal, or
non-reciprocal
Reciprocal Obligations
Those which arise from the same cause and in
which each party is debtor and creditor of the
other.
Implied Condition
There must be compliance by the other with
the duties incumbent upon him as party to the
debt.
In reciprocal obligations, a party cannot
demand unless he complies or is ready to
comply with obligations (inferred from 1169).
*This is subject to same rules on interim
obligations and interim remedies.
Non-Reciprocal Obligations
Those which do not impose simultaneous and
correlative performance on both parties. The
performance of one party does not depend
upon the simultaneous performance of
another.
Remedies in Reciprocal Obligations
RESCISSION IN ARTICLE 1191
The power to rescind means the right to
cancel or to resolve the contract in case of
non-fulfillment of the obligation on the part of
one of the parties.
It is the breach of faith committed by the
person who is supposed to comply with
obligation. It is not the rescission in 1380
which involves damage or lesion, or injury to
the economic interest of a person.
Characteristics
1. It only exists in reciprocal obligations.
2. 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. Berwia, 48 Phil. 581)
General Rule
Judicial approval is necessary for rescission,
except:
a. When the object is not yet delivered
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future
As to influence on
the obligation
Merely fixes
the time for the
efficaciousness
of the
obligation.
If suspensive,
it cannot
prevent the
birth of the
obligation in
due time.
If resolutory, it
does not annul,
even in fiction,
the fact of its
existence.
As to effect, when
left to the debtors
will
Depends upon
the will of the
debtor
empowers the
court to fix its
duration
As to retroactivity
of effects
Unless
stipulated, the
arrival of a
period has no
retroactive
effect.
Annulling conditions:
a. Potestative only if suspensive condition
is solely upon the will of the debtor (1182)
b. Impossible Conditions (1183)
c. those contrary to law, good customs,
morals, public order or public policy
(1183)
d. Not to do an impossible thing not agreed
upon (1183, par. 2)
Lao Lim v. CA
The stipulation that the lessee has the right to
renew contract of lease as long as he needs
the premises and he can pay for the same is
invalid. It would leave the lessee, Dy, the sole
power to determine whether the lease should
continue or not. The lease contract is deemed
extinguished at the end of a year, subject to
renewal by means of a new agreement but
since the lessor did not want to renew, there
is no more lease.
Romero v. CA
This case shows that one cannot rescind a
contract on account of ones own failure to
fulfill an obligation.
Ducusin v. CA
Only that which is dependent on the sole will
of the debtor is invalid. No one is supposed to
have sole power.
In this case, since the
condition is dependent on the will of third
persons, the condition was held to be valid.
unknown to parties
It causes an
obligation to arise
or be terminated.
The happening of
the condition has
retroactive effect.
1. According to effect
a. suspensive period (ex die) obligation
becomes demandable only upon the
arrival of a certain day
b. resolutory period (in diem) obligation
is valid up to a day certain and
terminated upon the arrival of period.
PERIOD or TERM
It is a future and certain event upon the
arrival of which the obligation (or right)
subject to it either arises or is terminated.
*The demandability is suspended by the term,
not the acquisition of the right or the
effectivity of the obligation.
*Fortuitous events do interrupt the running of
the period.
Distinguishing a period from a condition
Period/ Term
As to fulfillment
Certain event
Condition
As to time
Refers only to the
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2. According to source
a. legal period provided for by law
b. conventional/
voluntary
period
agreed to by the parties
c. judicial period fixed by the court
3. According to definiteness
a. definite period fixed or the coming of
which is known
b. indefinite period not fixed or the
coming of which is not known (usually,
the law empowers the courts to fix the
period)
Uncertain event
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VESSELS.
PERIOD.
FIXING OF A PERIOD
General Rule
Exception
When it appears from the tenor of the
obligation or other circumstances that the
period has been established in favor of one or
the other subject to an express stipulation of
the parties, the period may be benefit the
debtor or the creditor alone.
Period for the benefit of the debtor alone:
The debtor cannot be compelled to pay
prematurely, however, he may renounce the
benefit of the period by performing his
obligation in advance. (Manresa)
Period for the benefit of the creditor alone:
The creditor may demand fulfillment even
before the arrival of the term but the debtor
cannot compel him to accept before the
expiration of the period (i.e., on demand).
Interim obligations
In case of loss, deterioration or improvement
of the thing before the arrival of the day
certain, the rules in article 1189 shall be
observed.
i. Exercise due diligence; otherwise,
responsibility for loss, deterioration
(1189)
ii. Improvement inures to creditor, if at
expense of debtor only usufructuary
right (1189)
iii. Recover payment or delivery before
due and demandable
ABESAMIS V. WOODCRAFT WORKS, INC.
THE CONTRACT PROVIDED THAT THE APPELLANT
SHALL MAKE SHIPMENT BEFORE THE END OF JULY,
BUT WILL NOT COMMENCE EARLIER THAN APRIL
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ALTERNATIVE OBLIGATION
It is one wherein various prestations are due
but the performance of one of them is
sufficiently determined by the choice which,
as a general rule, belongs to the debtor.
(Manresa)
FACULTATIVE OBLIGATION
It one where only one prestation has been
agreed upon but the obligor may render
another in substitution.
Distinguising Alternative and Facultative
Obligations
SHALL
BECOME
IMMEDIATELY
PAYABLE OR DEMANDABLE.
AFTER
THE
OBLIGATION
WAS
CONSTITUTED.
Gaite v. Fonacier
Payment of obligation was secured by two
surety bonds: one from a mining company
and its stockholders and the other from a
bonding company. The obligor was obliged to
pay the indebtedness from the time it
received the proceeds of the sale of iron ore,
the Supreme Court ruled that the obligor in
this case lost its right to the period. Failure to
renew an expired surety with the bonding
company constituted an impairment of the
securities or guaranties. Thus, Fonacier lost
his right to the period, i.e. time to sell the iron
ore, unless he immediately gives new ones
equally satisfactory.
III. ALTERNATIVE OBLIGATIONS
Kinds of Obligation according to Object
1. Simple obligation one where there is
only one prestation
2. Compound obligation one where there
are two or more prestations
a. Conjunctive obligation one where
there are several prestations and all of
them are due
b. Distributive obligation one where one
of two or more of the prestations is
due
*A distributive obligation may be
alternative (1199), or
facultative (1206)
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Alternative
Number of
prestations
Several
prestations are
due but
compliance with
one is sufficient
Right of choice
May be given to
the creditor or to
a third person
Loss through a
fortuitous event
The loss of one or
more of the
alternatives does
not extinguish
the obligation
Loss through
fault of debtor
a) Does not
render the debtor
liable
b) Where the
choice belongs to
the creditor, the
loss of one
alternative gives
rise to liability
Nullity of
prestation
a) The nullity of
one prestation
does not
invalidate the
others
b) the debtor or
creditor should
choose from
among the
remainder
2008
Facultative
Only one
prestation is due
although the
debtor is allowed
to substitute
another
The right to make
the substitution is
given only to the
debtor
The loss of the
thing due
extinguishes the
obligation.
a) The debtor is
liable
b) The loss of the
substitute before
the substitution
does not render
the debtor liable
a) The nullity of
the prestation
agreed upon
invalidates the
obligation
b) the debtor is not
bound to choose
the substitute
CIVIL LAW
Right of Choice
General Rule
Before
After Substitution
Substitution
Loss of the Principal
Fortuitous Event
The debtor is not
The obligation is liable whatever may
extinguished
be the cause
Fault of Debtor
The
debtor
is
liable
for
damages
Loss of the Substitute
The debtor is not Fortuitous Event
liable
whether The obligation is
the loss is due to extinguished
the fault of the Fault of Debtor
debtor or to a The debtor is liable
fortuitous event. for damages
2.
3.
The
debtor
cannot
choose
those
prestations which are impossible, unlawful
or which could not have been the object of
the obligation. (1200)
The debtor has no more right of choice
when among the prestations whereby he is
alternatively
bound,
only
one
is
practicable.
The debtor cannot choose the part of one
prestation and part of another.
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JOINT OBLIGATIONS
Obligacion Mancomunada
It is an obligation where the whole liability is
to be paid or fulfilled proportionately by the
different debtors; and/or is to be demanded
proportionately by the different creditors.
SOLIDARY OBLIGATION
Obligacion Solidaria
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Indivisible obligations
solidary (1210)
Indivisibility
Refers
to
prestation
solidarity
among
Active
Solidarity
Solidarity of
creditors
Any one of
the creditors may
demand fulfillment
of
the
entire
obligation.
Its essential
feature is that of
mutual
representation.
Joint Indivisibility
Solidarity
the
Characteristics
1. Demand must be made to all the joint
debtors.
2. The creditor must proceed against all the
joint debtors, because the compliance of
the obligation is possible only if all of the
joint debtors would act together.
3. If one of the debtors is insolvent, the
other(s) shall not be liable for his share.
4. If one of the debtors cannot comply, the
obligation is converted into monetary
consideration. One who is ready and
willing to comply will pay his proportionate
share, and the other not willing shall pay
his share plus damages when his financial
condition improves.
5. If there is more than one creditor, delivery
must be made to all, unless one is
authorized to receive for the others.
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RULES
1. GIVES RISE TO INDEMNITY FOR DAMAGES:
NON-COMPLIANCE
WITH
UNDERTAKING
(1224)
2. DEBTORS READY TO FULFILL SHALL NOT BE
LIABLE (1224)
*AS ALREADY STATED, IN A JOINT INDIVISIBLE
OBLIGATION, A SUIT FOR SPECIFIC PERFORMANCE
MUST BE DIRECTED AGAINST ALL THE DEBTORS
AND IF ANY ONE OF THEM IS NOT WILLING TO
FULFILL, THE ACTION SHALL BE CONVERTED INTO
ONE FOR DAMAGES WHERE THE DEBTORS SHALL BE
LIABLE FOR THEIR RESPECTIVE SHARES WHILE THE
UNWILLING DEBTOR SHALL PAY HIS SHARE PLUS
DAMAGES FOR HE ALONE SHALL BE LIABLE FOR
DAMAGES, THE OTHER DEBTORS BEING WILLING
TO DELIVER.
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Suretyship
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Purposes of Penalty
b. CONVENTIONAL
INDIVISIBILITY
BY
THEM
TO
TREAT
THE
THINGS
AS
OF THE OBLIGATION
As to origin
Legal penal clause provided by law
Conventional penal clause provided for
by stipulation of the parties
As to its purpose
Compensatory penal clause the penalty
takes the place of damages
Punitive penal clause the penalty is
imposed merely as a punishment for
breach
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Condition
No obligation
through an
accessory
Is never
demandable
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1. Novation
2. Compensation
3. Merger or confusion
4. Remission or condonation
5. Payment or performance
6. Loss of the thing due
7. Prescription
8. Rescission
9. Fulfillment of the Resolutory condition
10. Annulment
(2) Payee
(a) payee - creditor or obligee or successor
in interest of transferee, or agent
(b) 3rd person - if any of the ff. concur:
i.
I. PAYMENT OR PERFORMANCE
The delivery of money, the delivery of the
thing (other than money), the doing of an act,
or not doing of an act.
ii. it falls under art 1241, par 1,2,3 the benefit is total so, performance
is total
Elements
The elements of payment are analyzed into:
1. persons- who may pay to whom payment
may be made
2. thing or object in which the payment must
consist
3. the cause thereof
4. the mode or form thereof
5. the place and time in which it must be
made
6. the imputation of expenses occasioned by
it
7. the special parts which may modify the
same and the effects they generally
produce
Requisites for Valid Payment
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Stipulation (1250)
Currency value at time of agreement.
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. (1250)
Effect of payment
The obligation is extinguished.
Except in an order to retain the debt.
Expenses:
Unless it is otherwise stipulated,
extrajudicial expenses required by
payment shall be for the account of
debtor. With regard to judicial costs,
Rules of Court shall govern. (1247)
Substantial Performance
1. Attempt in Good Faith to perform without
willful or intentional departure
2. Deviation is slight
3. Omission/Defect
is
technical
or
unimportant
4. Must not be so material that intention of
parties is not attained
Effect of Substantial performance in good faith
1. Obligor may recover as though there has
been strict and complete fulfillment, less
damages suffered by the obligee
2. Right to rescind cannot be used for slight
breach
Currency
Stipulated (1249)
Philippine legal tender
The payment of debts in money shall be made
in the currency stipulated, and if it is not
possible to deliver such currency, then in the
currency which is legal tender in the
Philippines. (1249)
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sale
both
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CONCEPT
Meaning of loss of the thing
1) When the object perishes (physically)
2) When it goes out of commerce
3) When it disappears in such a way that its
existence is unknown or it cannot be
recovered
When is there impossibility of
performance
1) Physical impossibility
2) Legal impossibility :
EFFECT OF TOTAL LOSS
In obligations to deliver a specific thing
General Rule: Extinguished
Exceptions:
a) Debtor is at fault
b) Debtor is made liable for fortuitous event
because of a provision of law, contractual
stipulation or the nature of the obligation
requires assumption of risk on part of
debtor
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Extent
total
Kinds
Principal accessory
also condoned
partial
accessory principal
still outstanding
accessory obligation
of pledge
condoned;
presumption only,
rebuttable
Implied Condonation
1. voluntary delivery presumption; when
evidence of indebtedness is w/ debtor
presumed that it is a voluntary delivery by
creditor; rebuttable
2. effect
of
delivery
of
indebtedness: conclusion
condoned
evidence
of
that debt is
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VI. NOVATION
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 3rd
person in the rights of the creditor.
It is the total or partial extinction of an
obligation through the creation of a new one
which substitutes it.
Requisites
1. The existence of a previous valid
obligation
2. The intention or agreement and capacity
of the parties to extinguish or modify the
obligation
3. The extinguishment or modification of the
obligation
4. The creation of a valid new obligation (Tiu
Siuco v. Habana, 45 Phil. 707, 1924)
The
new
debtor
is
entitled
to
reimbursement of the entire amount paid
and subrogation.
2. Substitution without the knowledge or
against the will of the old debtor
The
new
debtor
is
entitled
to
reimbursement in so far as beneficial to
the old debtor with no right if subrogation
Purpose of Novation
Kinds of Novation
1. As to essence
a. Objective/ Real This refers to the
change in either the cause, object or
principal
b. Subjective/ Personal This refers to
the substitution of the person of the
debtor or to the subrogation of the 3rd
person in the rights of the creditor
c. Mixed
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
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and
1. The new debtors insolvency or nonfulfillment of the obligation shall not revive
the original debtors liability to the creditor
whether the substitution is effected with or
without the knowledge or against the will
of the original debtor. (Tolentino)
2. If the substitution was effected with the
knowledge and consent of the original
debtor, the new debtors insolvency or
non-fulfillment of the obligation shall
revive the original debtors liability to the
creditor.
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DELEGACION
General Rule
Requisites
Exception
the
the
the
the
LEGAL
That which takes place without the agreement
but by operation of law because of certain
acts.
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Definition
A contract is a meeting of the minds between
two persons whereby one binds himself, with
respect to the other, to give something or to
render some service. (1305)
A contract is a juridical convention manifested
in legal form, by virtue of which, one or more
persons bind themselves in favor of another
or others, or reciprocally, to the fulfillment of
a prestation to give, to do, or not to do.
Principal Characteristics (AMOR = love)
1.
2.
3.
4.
Autonomy
Mutuality
Obligatory Force and Consensuality
Relativity
AUTONOMY
This is the freedom or liberty to stipulate.
General Rule
The parties are free to stipulate anything they
may deem convenient.
Except
As
1.
2.
3.
4.
5.
MUTUALITY
Performance or validity of the contract binds
both parts and it cannot be left to the will of
one of them. (1308)
OBLIGATORY FORCE & CONSENSUALITY
Contracts are perfected by mere consent and
from that moment, the parties are bound, not
only to the fulfillment of what has been
expressly stipulated but also to all the
consequences which, according to their
nature, may be in keeping with good faith,
usage and law.
RELATIVITY
General Rule
Contracts take effect only between parties,
their assigns and their heirs.
Exceptions
1. Obligations arising from contract which are
not
transmissible
by
their
nature,
stipulation, or provision of law.
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Plurality of subject
Capacity
Intelligence and free will
Manifestation of intent of parties
Cognition by the other party
Conformity of manifestation and cognition
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Advertisements as Offers
1. Definite
2. Complete
3. Intentional
Agent as offerer
An offer made through an agent is accepted
from the time acceptance is communicated to
him. (1322)
ACCEPTANCE
The manifestation by the offeree of his assent
to the terms of the offer.
1. Unequivocal
2. Unconditional
UP
before
the
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Disqualification
Restrains the very
right itself
Absolutely
disqualified
Violence
Intimidation
Mistake
Fraud
Undue Influence
VIOLENCE
There is violence when in order to wrest
consent, serious or irresistible force is
employed.
Requisites
a. Irresistible physical force
b. Such force is the determining cause for
giving consent
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. (1335)
Requisites
a. One of the parties is compelled to give his
consent by a reasonable and wellgrounded fear of an evil
b. The evil must be imminent and grave.
c. The evil must be unjust.
d. The evil must be the determining cause for
the party upon whom it is employed in
entering into the contract.
Reluctant Consent
A contract is valid even though one of the
parties entered into it against his wishes and
desires or even against his better judgment.
Contracts are also valid even though they are
entered into by one of the parties without
hope of advantage or profit. (Martinez v.
Hongkong and Shanhai Bank, 15 Phil
252)
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MISTAKE
It is not only a wrong conception of the thing
but also the lack of knowledge with respect to
it. (Manresa)
General Rule
Mistake does not vitiate consent.
Exception:
Mutual error as to the effect of an agreement
when the real purpose of the parties is
frustrated.
Requisites:
a. Mistake must be with respect to the
legal effect of an agreement
b. It must be mutual
c. The real purpose of the parties must
have been frustrated
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. (1338) (Dolo Causante)
Kinds of Fraud
Except when:
1. There is collusion by one of the parties
o fthe contract with the 3rd person.
2. There is misrepresentation that has
created a substantial mistake and the
same is mutual.
UNDUE INFLUENCE
There is 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.
(Coso v.
Fernandez Deza, 42 Phil. 595)
Simulated Contracts
Exceptional Cases
SIMULATION
i.
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III. CAUSA
Requisites
II. OBJECT
The thing, right or service which is the subject
matter of the obligation arising from the
contract.
Cause is always
same for each
contracting party
The legality or
illegality of
cause affects the
existence or
validity of the
contract
Requisites (PLDT-Ctc)
a) The prestation must be within the
Commerce of man, either existing or in
potency
b) It must be Licit or not contrary to law,
morals, good customs, public order, or
public policy.
c) It must be Possible or real.
d) It must be Determinate as to its kind or
determinable without the need to enter
into a new contract. (1349)
e) It must be Transmissible.
Those which Cannot be the Object of a
Contract (Fruits In Cream IOI)
1. Future inheritance (1347)
2. Impossible things or services cannot be
the object of contracts. (1348)
3. Contrary to law morals, good customs,
public order, and public policy.
4. Indeterminable as to their kind.
5. Outside the commerce of men
6. Intransmissible rights
Motive
Indirect and remote
reason
Psychological or
purely personal
reason
Motive differs for
each contracting
party
The legality or
illegality of motive
does not affect the
existence or validity
of the contract.
Future Things
Effects of Cause
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EXCEPTION
Cause
Absence of
causa
Illegality of
causa
Falsity of causa
Causa not
stated in
contract
Inadequacy of
causa
Effect
VOID - produce no legal
effect
VOID - produce no legal
effect
VOIDABLE party must
prove that cause is
untruthful; presumption
of validity but rebuttable
PRESUMED TO EXIST burden of proof is on the
person assailing its
existence
DOES NOT INVALIDATE
CONTRACT PER SE
Exceptions:
1. when there is fraud,
mistake or undue
influence, or
2. when the parties
intended a donation or
some other contract
General Rule
SPIRITUALITY PRINCIPLE
Contracts are valid and enforceable in
whatever form, even if orally entered into, as
long as all essential requisites are present.
(1356)
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Solis v. Barroso
Even where the contract has not been reduced
to the required form, it is still valid and
binding as far as contracting parties are
concerned. Consequently both presuppose the
existence of a valid and enforceable contract.
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FOR ENFORCEABILITY
(Statute of Frauds)
(1403, par. 2, in relation to 1405)
Those that do not comply with the Statute of
Frauds as set forth in this number.
*However,
special
presumptions
for
computers were made into law by the ecommerce act.
Public Document
The following must appear in a public
document: (1358)
1. Real rights over immovable property, sales
of real property - Acts and contracts which
have for their object the creation,
transmission,
modification
or
extinguishment
of
real
rights
over
immovable property; sales of real property
or of an interest therein a governed by
articles 1403, No. 2, and 1405;
2. Hereditary rights and conjugal property of
gains
-The
cession,
repudiation
or
renunciation of hereditary rights or of
those of the conjugal partnership of gains
3. Power to administer property, other
powers to act, prejudice 3rd persons - The
power
to administer property, or any
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require
proof
or
acknowledgement of visiting the site. This
is usually done by pre-program procedure
like requirement of registration before
being given access.
8. On security of signature electronic
imprints, identification systems, and codes
to
avoid
Special Cases
1. Mutual mistake - When a mutual mistake
of the parties causes the failure of the
instrument
to
disclose
their
real
agreement, said instrument may be
reformed.
2. Mistaken party, not fraudulent - If one
party was mistaken and the other acted
fraudulently or inequitably in such a way
that the instrument does not show their
true intention, the former may ask for the
reformation of the instrument.
3. Mistaken party, other knew of mistake and
non-conformity of instrument When one
party was mistaken and the other knew or
believed that the instrument did not state
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READ AS A WHOLE
The various stipulations of a contract shall be
interpreted together, attributing to the
doubtful ones that sense which may result
from all of them taken jointly. (1374)
IN KEEPING WITH NATURE AND OBJECT
OF CONTRACT
Chapter V: Interpretation of
Contracts
(Arts. 1370-1379)
DOUBTS
1. Doubts
with
circumstances:
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regard
to
incidental
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who is prejudiced by
the
contract
may
demand
the
rescission
of
the
contract.
Court cannot grant
extension of time for
fulfillment
of
the
obligation
Its purpose is to
seek reparation for
the damage or injury
caused,
thus
allowing
partial
rescission
of
the
contract
Requisites of Rescission
*DEFECTIVE CONTRACTS
Kinds of Defective Contracts (VURV, The
VURV Pipe or, a VURV an action word)
1.
2.
3.
4.
Rescissible Contracts
Voidable Contracts
Unenforceable Contracts
Void or Inexistent Contracts
Rescission Proper in
1381
It is a subsidiary
remedy
There are 5 grounds
to
rescind.
Nonperformance by the
other
is
not
important
are
rescissible:
It applies to both
unilateral
and
reciprocal
obligations
Even a third person
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e.
f.
g.
h.
i.
j.
k.
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Mutual Restitution
Things w/c are the objects of the contract and
their fruits
Price with interest
When Mutual Restitution is not Applicable
a. When the creditor did not receive anything
from the contract.
b. When the thing is already in possession of
the party in good faith; subject to
indemnity only; if there are 2 or more
alienations, it is the liability of the 1st
infractor
When Contracts can be Rescinded on the
Ground of Lesion
1. The contract must have been entered into
by a guardian in behalf of his ward or by a
legal representative in behalf of an
absentee.
2. The ward or absentee must have suffered
lesion of more than of the value of the
property which is the object of the
contract.
3. The contract must have been entered into
without judicial approval. (court approval)
4. There must be no other legal means of
obtaining separation for the lesion.
(subsidiary character of rescission)
5. The person bringing the action must be
able to return whatever he may be obliged
to restore. (mutual restitution)
6. The object of the contract must not be
legally in the possession of a third person
who did not act in bad faith.
When Contracts can be Rescinded on the
Ground of Fraud (Accion Pauliana)
1. There must be credit existing prior to the
celebration of the contract.
2. There must be fraud or, at least, the
intent to commit fraud to the prejudice of
the creditor seeking rescission.
3. The creditor cannot, in any legal manner,
collect his credit.
4. The object of the contract must bot be
legally in possession of a 3rd person who
did not act in bad faith.
Presumptions of Fraud
Effect of Rescission
By Gratuituous Title
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By Onerous Title
Alienations by onerous title are also presumed
fraudulent when made by persons against
whom some judgment has been issued.
The decision or attachment need not refer to
the property alienated, and need not have
been obtained by the party seeking the
rescission.
*In addition to these presumptions, the
design to defraud creditors may be proved in
any other manner recognized by the law
of evidence. (1387)
Badges of Fraud
1. Consideration of the conveyance is
inadequate or fictitious
2. Transfer was made by a debtor after a suit
has been begun and while it is pending
against him
3. Sale upon credit by an insolvent debtor
4. Evidence of indebtedness or complete
insolvency
5. Transfer of all his property by a debtor
when he is financially embarrassed or
insolvent
6. Transfer made between father and son
where there is present any of the above
circumstances
7. Failure of the vendee to take exclusive
possession of the property
Reliefs
1. Grant rescission only to extent
necessary; no other means; ability to
restore; no acquirer in good faith; nos. 1
and 2 are not court approved
2. Order return ability to restore; object of
contract or its price, together with fruits,
plus interests
3. Damages: Who are liable?
a.
Art.
1189
rules
on
improvement, loss, or deterioration
b.
Acquirer in bad faith (1388)
*If there are two or more alienations,
the first acquirer shall be liable first,
and so on successively. (1388)
c.
One who alienates to acquirer in
good faith (1385, par. 3)
Prescriptive Period
Exception
In certain contracts of sale which are specially
declared by law to be rescissible, the period is
6 months or even 40 days, counted from the
day of deliver. (1542, 1571, 1577)
General Rule
Within four (4) years from the date it was
entered into:
a. If the person is under guardianship, within
4 years from the time the guardianship
ceases
b. In case of absentees, within 4 years from
the time domicile is known
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General Rule
The party prejudiced has the right to annul a
voidable contract.
Exception
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Characteristics
1. It produces no effect whatsoever either
against or in favor of anyone
2. There is no action for annulment
necessary as such is ipso jure. A judicial
declaration to that effect is merely a
declaration
3. It cannot be confirmed, ratified or cured.
4. If performed, restoration is in order,
except if pari delicto will apply
5. The right to set up the defense of nullity
cannot be waived
6. Imprescriptible
7. Anyone may invoke the nullity of the
contract whenever its juridical effects are
asserted against him
Illegal Contracts
Kinds of Illegal Contracts
In Pari Delicto Doctrine
*Only applicable to void contracts and not to
inexistent contracts.
General Rule
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 every
remedy and leaves tehm where they are.
Contract constitute
criminal offense
will be confiscated
in favor of the
governement
Exception
1. If the purpose has not yet been
accomplished and if the damage has not
been cause to any 3rd person
2. Payment of usurious interest (1413)
3. 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 3rd person (1415)
4. Payment of money or delivery of property
made by an incapacitated person (1416)
5. Agreement or contract which is not illegal
in itself and the prohibition is designed for
the protection of the plaintiff (1416)
6. Payment of any amount in excess of the
maximum price of any article or
commodity fixed by law or regulation by
competent authority (1417)
7. Contract whereby a laborer undertakes to
work longer than the maximum number of
hours fixed by law. (1418)
8. Contract whereby a laborer accepts a
wage lower than the minimum wage fixed
by law. (1419)
9. One who lost in gambling because of
fraudulent schemes practiced on him is
allowed to recover losses even if the
gambling is prohibited. (315, RPC)
Requisites of illegal contracts
No action for
specific
performance
Innocent party is
entitled to
restitution
Guilty party is not
entitled to
restitution
if
price
of
commodity is determined by statute, any
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General Rule
Effective only between parties thereto or
successors in interest. (1439)
Types of Estoppel
1. By Conduct (in pais) intentional and
culpable negligence
Elements
a. acts inducing another to believe certain
facts to exist
b. with intent or culpable negligence
c. the other party rightfully relies and
acts on such belief
d. other party would be prejudiced if the
guilty party is allowed to deny facts
first represented by him
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or
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Types:
a. by silence
b. by acceptance of benefits
c. by
acts
representations
admissions
5. By Laches
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Elements
1. Conduct on the part of the defendant,
or of one under whom he claims,
giving rise to the situation of which
complaint is made and for which the
complaint seeks a remedy.
2. Delay in asserting the complainants
rights,
the
complainant
having
knowledge or notice, of the defendants
conduct and having been afforded the
opportunity to institute a suit
3. Lack of knowledge or notice on the
part of the defendant that the
complainant would assert the right on
which he bases his suit
4. Injury to the defendant in the event
relief is accorded to the complainant
The following are estopped
Ownership transfers to the buyer (in Sales)
1. Seller or grantor who is not owner at time
of sale but he later acquires ownership of
such (1434)
2. Seller represents owner in a sale; cannot
contest title of ownership of buyer (1435)
Lessee or bailee cannot claim ownership of
thing leased or received against lessor or
bailor (1436)
Misleader in 3rd party contracts on immovable
property
Requisites
1. fraudulent representation or wrongful
concealment of facts known to the party
estopped;
2. intent by party precluded that the other
should
act
upon
the
facts
as
misrepresented;
3. party misled must have been unaware of
the true facts; and
4. party defrauded must have acted in
accordance with the misrepresentation.
Owner allowing another to feign ownership,
cannot claim ownership as defense against
pledge. (In pledge) (1438)
***
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Sales
TABLE OF CONTENTS
I.
II.
III.
IV.
V.
VI.
VII.
VIII.
IX.
X.
XI.
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Contract of Sale
Elements of a Valid Sale
Transfer of Ownership
Risk of Loss
Document of Title
Obligations of Seller and Buyer
Remedies of Seller and Buyer
Double Sale
Extinguishment of Sale
Assignment
Special Laws
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172
175
176
176
178
182
189
190
192
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Revised Administrative Code of
1917)
b. In sale of land through agent,
the authority of the agent must
be written; otherwise, sale is
void (Art.1874)
F. REMEDIES:
1. Specific Performance + damages (Arts.
1191 and 1165(1))
2. Rescission + damages (Art. 1191)
3. Damages (Art. 1170)
G. VIS-A-VIS:
1. Bilateral promise
to buy and sell
(Art. 1479(1)2)
o
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Distinct
consideration
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of offer
BEFORE
acceptance
AFTER
acceptance
of offer
ONLY IF
there is an
abuse of
right under
Art. 19, CC
(no
damages for
breach of
option
contract)
Specific
Performance
of sales
contract
UNLIKE sale:
- price and other terms yet to be
agreed upon (Ang Yu Asuncion v.
CA, 1994)
- it is unilateral
UNLIKE option:
- The grantee has no right to buy or
sell, only a right to the first offer
should the grantor decide to sell
(Polytechnic University of the
Philippines v. CA, 2001)6
- Separate consideration NOT
required7
- rescission and specific performance
available in case of breach
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cause
and
AGENCY TO SELL
Agent does not
pay price, but
only delivers to
the principal the
price he obtains
from the sale to a
third person
Agent does not
become the
owner
Agent cannot
make secret
profit in selling
3. Barter
SALE
BARTER
Price in money or
Consideration is
its equivalent
another thing
If the consideration is partly in money
and partly in another thing:
1. look at manifest intention of the
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parties
to
characterize
the
transaction;
2. if no manifest intention:
o barter: if value of thing > amt of
money or its equivalent
o sale: if value of thing < amt of
money or its equivalent
4. Dation (Art. 1245)
SALE
No pre-existing debt
Creates obligation
DATION
w/
pre-existing
debt
Extinguishes
obligation (mode
of payment)
5. Lease of things
SALE
Ownership
transferred
LEASE OF THING
Ownership not
transferred
6. Donation
SALE
onerous
DONATION
gratuitous
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Total loss
Partial loss OR
material
deterioration in
whole or in part
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Price must be in
o MONEY or
o its EQUIVALENT
- e.g. letter of credit (Baviera)
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Consent:
meeting
of
offer
and
acceptance on the
1. thing sold
2. price
- 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 (Toyota Shaw
v. CA, 1995)
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Status of sale:
- Where 1 party incapacitated:
VOIDABLE (Art.1390(1))
- Where both parties incapacitates:
UNENFORCEABLE (Art.1403(3))
BUT when necessaries (those
indispensable for sustenance, clothing,
dwelling, medical attendance, education,
transportation) are sold and delivered to
incapacitated person, he must pay a
reasonable price therefor. (Art.1489)
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B. DELIVERY
o
1. Actual delivery
o placing the thing sold in the control
and possession of the buyer (Art.1497)
2. Constructive Delivery
(Arts. 1498-1501)
Kind
1. Symbolic
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2. Traditio
longa manu
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How Made
o By
execution
of public
instrumen
t
evidencin
g sale
except: if
contrary
appears or
can be
clearly
inferred
o delivery
of keys
where
stored/ke
pt
By mere
agreement
of the buyer
Applies to
real or
personal
property;
incorporeal
property
personal
property
personal
property
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Kind
3. Traditio
brevi manu
4. Traditio
constitutum
possessorium
5. Quasitradition
6. Tradition
by operation
of law
(Art.1434)
7. Delivery to
a carrier9
How Made
and seller if
possession
cannot be
transferred
at the time
of the sale
By mere
agreement
of the buyer
and seller if
the buyer
already had
possession
for any
other reason
Seller
remains in
possession
of the
property in
a different
capacity e.g.
as lessee
Placing of
the titles of
ownership
in the
possession
of the buyer
or allowing
the buyer to
use his
rights
When a nonowner who
sells a thing
later
acquires
title thereto
delivery to a
carrier for
transmission
to the buyer
Applies to
-
personal
property
real or
personal
property
incorporeal
property
D. CONTROL
o The efficacy of symbolic delivery can
be prevented if the seller does not
possess control over the thing sold, in
which case this legal fiction must yield
to reality.
o The key word is control, NOT
possession. The presence of lessees or
illegal occupants who do not have
claims of ownership does not prevent
symbolic delivery (Power Commercial
and Industrial Corp. v. CA, 1997; Sabio
v. The International Corporate Bank,
Inc., 2001)
goods
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V. DOCUMENT OF TITLE
Document of title is a document
o used as proof of possession or control
of the goods sold, or
o authorizing or purporting to authorize
the possessor of the document to
transfer or receive goods represented
by such document (Art.1636(1))
Examples:
- bill of lading
- quedan
- warehouse receipt
It may be negotiable (bearer or order) or nonnegotiable.
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1.
2.
Rights under
negotiation
title to the
goods of the
one who
negotiated and
of the original
consignee
(Art.1513(1))
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
(Art.1513(2))
3.
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freedom from
the defenses of:
- breach of
duty
- loss
- theft
- accident
- mistake
- conversion,
if the buyer of
the document
paid value
therefor in good
faith and
without notice
(Art.1518)
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1. Preservation
o
2. Delivery
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c.i.f
(cost,
insurance,
freight)
Price
quoted
includes
the costs of
the goods,
insurance,
and freight
charges on
the goods
up to the
place of
destination
F.a.s
(free
alongside)
Seller bears
the expenses
of
transportation
until he
delivers the
goods
alongside a
vessel at a
named port
3. Warranty
o may be express or implied
o cf. condition on performance of obligation:
- if condition not performed, party
whose obligation is subject to the
condition may refuse to proceed
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sale of a secondhand article. (Moles v.
IAC, 1989)
Cf. fraud: in fraud, there must be an
intention to deceive or mislead the other
party to his prejudice (Philippine
Manufacturing Co. v. Go Jucco, 1926)
Implied Warranty
IMPLIED warranties (unless a contrary
intention appears)10: (Art.1547)
1. Implied Warranty of Title
2. Implied Warranty against Encumbrance
3. Implied warranty against Hidden Defects
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OTHER warranties
1. Warranty in sale of CONSUMER GOODS
o Consumer goods- goods primarily for
personal, family, household or agricultural
purposes, which shall include but not
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1. Acceptance
o Modes of accepting goods: (AIR)
1. Buyer intimates to the seller that he has
accepted the goods.
2. Goods delivered to the buyer and he does
any act in relation to them which is
inconsistent with the ownership of the
seller.
3. After the lapse of a reasonable time, the
buyer retains the goods without intimating
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2. Payment
o 3 cases where the buyer is liable for
interest for the period between delivery
and payment: (STD)
1. It is stipulated;
2. Thing sold produces fruits or income;
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3. Buyer is in default (interest accrues
from the time of judicial or
extrajudicial demand for the payment
of the price)
Rights of the buyer:
1. Suspend payment
When:
a) he is disturbed in the possession or
ownership of the thing acquired or
has reasonable grounds to fear
such disturbance,
b) by a vindicatory action or a
foreclosure of mortgage
Until when: until the seller has caused
the disturbance or danger to cease
Exceptions:
b) When the seller gives security for
the return of the price in a proper
case
c) When it has been stipulated that,
notwithstanding any such
contingency, the buyer shall be
bound to pay
A mere act of trespass shall not
authorize the suspension of the
payment. (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. (Art.1592)
No breach
(obligation
extinguished)
Through fault of
seller OR through
fortuitous event if
seller liable even for
fortuitous events
Damages
No breach
(impairment
borne by buyer)
1. Rescission +
damages OR
2. SP + damages
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Goods (Art.1522)
Less
1. Reject OR
2. Accept and pay
- at contract rate: if he
accepts knowing that the
seller is not going to perform
in full; or
- fair value: if he used the
goods delivered before
knowing that the seller is not
going to perform in full
More
1. Reject the excess or the
whole
if indivisible OR
2. Accept the whole and pay at
contract rate
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more
Lump sum/
sale of 2 or
more
immovables
for a single
price
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prescriptive
pd: 6 mos.
from delivery
1. Reject the
excess OR
2. Accept the
whole and
pay at
contract rate.
Everything
No remedy
w/in
o Where
boundaries,
both the
even if less
area and
or more
the
than stated
boundaries
area
of the
immovable
are
declared,
the area
covered
within the
boundaries
of the
immovable
prevails
over the
stated
area.
(Rudolf
Lietz, Inc.
v. CA,
2005)
NOT
1.
everything
proportional
w/in
reduction in
boundaries price OR
2. rescission
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Effects of rescission:
1. Buyer no longer liable for price and
entitled to return of any part
thereof paid, concurrently with or
immediately after an offer to
return the goods.
2. If seller refuses to accept offer to
return goods, buyer deemed bailee
for the seller and has right of lien
to secure payment of any part of
price paid.
Implied Warranty Against Eviction
(Arts.1555&1556)
Total
eviction
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o
Partial
eviction
1.
2.
Costs of
- eviction suit and
- in a proper case, suit
against seller for the
warranty
Expenses of the contract,
IF the buyer has paid
them
Damages and interests,
and ornamental expenses,
IF the sale was made in
BF
Enforce liability for
eviction (VICED) OR
Rescind, IF he would not
have bought the thing sold
without the part lost (but
he must return the thing
without other
encumbrances than those
which it had when he
acquired it)
proportionate
reduction of the price
(accion quanti
minoris)+damages
Thing Due to
o If seller aware of
lost
hidden
defect- may demand:
fault
- return of price
- refund of
expenses of
contract
- damages
o If seller not aware of
defect- may demand
price and expenses
but not damages
Due to
Demand:
fortuitous o Price paid minus
event or
value of thing when
to fault of
it was lost
buyer
o Damages IF the
seller acted in BF
o Prescriptive period: 6 mos. from delivery
o RULES: (Arts.1549-1554)
1. Buyer need not appeal from the decision to
hold seller liable for eviction.
2. When adverse possession commenced
before sale but prescriptive pd. completed
after transfer- seller not liable
3. If property sold for nonpayment of taxes
due and not made known to the buyer
before sale- seller liable
4. Judgment debtor also responsible for
eviction in judicial sales, unless it is
otherwise decreed in the judgment
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1. Withdraw from
contract (accion
redhibitoria) +
damages; OR
2. Demand a
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days nor more than one (1) year
following the sale of new consumer
products.
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Right of LIEN
o Available when:
1. Goods sold w/o any stipulation as to
credit;
2. Goods sold on credit, but the term of
credit has expired; or
3. Buyer becomes insolvent14
o Lost when:
1. Seller delivers goods to carrier or other
bailee for transmission to the buyer
w/o reserving ownership or right to
possession;
2. Buyer or his agent lawfully obtains
possession of the goods
3. Seller waives it
o NOT lost by reason only that the buyer
has obtained judgment for the price of the
goods
o In case of part delivery: may exercise
right of lien as to remainder UNLESS part
delivery made with intent to waive the lien
o NOT affected by any sale or other
disposition of goods which the buyer may
have made UNLESS the seller has
consented thereto
BUT if negotiable doc of title has
been issued, right of a holder in
due course NOT defeated, whether
the negotiation be prior or
subsequent to the notification of
the carrier or other bailee of the
sellers claim to a lien.
Right of STOPPAGE IN TRANSITU
o Available when the buyer of the goods is
or becomes insolvent
o Goods are in transit:
1. From the time they are delivered to a
carrier or other bailee for transmission
to the buyer until buyer or his agent
takes delivery;
2. If buyer rejects the goods and the
carrier or bailee continues in
possession, even if the seller has
refused to receive them back
o Goods no longer in transit if:
1. Buyer or his agent obtains delivery of
the goods before their arrival at the
appointed destination;
2. After the arrival of the goods at the
appointed destination, carrier or bailee
acknowledges to the buyer or his
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agent that he holds the goods on his
behalf and continues in possession of
them as bailee for the buyer or his
agent (immaterial if buyer indicates
further destination for the goods;
3. The carrier or baileewrongfully refuses
to deliver the goods to the buyer or his
agent
Exercised by:
1. Obtaining actual possession of the
goods; OR
2. Notifying carrier or bailee of his claim
If carrier or bailee has issued a
negotiable document of title, it
must first be surrendered for
cancellation before the goods are
redelivered to the seller
In case of part delivery: may exercise
right of stoppage in transitu as to
remainder UNLESS circumstances of part
delivery show an agreement with the
buyer to give up possession of the whole
of the goods.
NOT affected by any sale or other
disposition of goods which the buyer may
have made UNLESS the seller has
consented thereto
BUT if negotiable doc of title has been
issued, right of a holder in due course
NOT defeated, whether the negotiation
be prior or subsequent to the
notification of the carrier or other
bailee of the sellers claim to a right of
stoppage in transitu
Right of RESALE
o Available to unpaid seller who:
1. has a right of lien; OR
2. has stopped the goods in transitu
o Available when:
1. Goods are of a perishable nature;
2. Seller expressly reserves the right of
resale in case the buyer defaults; or
3. Buyer defaults in payment for an
unreasonable time
o For the resale to be valid, the seller need
NOT notify the original buyer of:
1. the intention to resell
2. the time and place of the resale
o BUT giving or failure to give notice of
intention to resell is relevant in
determining WON the buyer had been in
default for an unreasonable time before
the resale was made.
o The seller must exercise reasonable care
and judgment in making a resale
o The resale may be by public or private
sale.
o The seller CANNOT buy the goods, directly
or indirectly.
o Effects of resale:
1. The seller is NOT liable anymore to the
original buyer:
- upon the contract of sale; OR
- for any profit made by the resale
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SPECIFIC PERFORMANCE
o
CANCELLATION OF SALE
o
o
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15
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In sale of immovables
1. Rescission for anticipatory breach
(Art.1591)
2. Specific Performance + damages under
Art.1191
3. Rescission + damages under Art.1191
Subject to the provisions of:
- Art.1592 in case of an absolute sale
(Odyssey Park, Inc. v. CA, 1997);
OR
- RA 655217 in case of a sale in
installment
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Rescission
o Available even after the seller has chosen
specific performance IF the latter becomes
impossible
o Instead of decreeing rescission, the court
may authorize the fixing of a period for a
just cause.
o In case of an absolute sale, the seller
must make a demand for rescission either
- judicially OR
- by a notarial act (Art. 1592)
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, 2001)
Effect of lack of demand: buyer can
still pay
Effect of demand: the court may not
grant the buyer a new term
The ff. have been considered by the SC
as constituting a judicial demand for
rescission:
1. Cross-claim (Luzon Brokerage Co.,
Inc. v. Maritime Building Co., Inc.,
1972);
2. Action for Judicial Confirmation of
Rescission and Damages (Iringan
v. CA, 2001)
3. Defense in the sellers Answer to
the buyers Action for Specific
Performance (Ramel v. Aquino,
2006)
o In installment sale of realty, RA 6552
imposes additional requirements for a
valid rescission
RA 6552 does not apply to:
1. industrial lots
2. commercial buildings
3. sale to tenants under RA 384418
Requirements for a valid rescission if
buyer has paid at least 2 years of
installments: (Sec.3)
1. Grace period- 1 mo/1 yr of
installment payments made; BUT
buyer may avail of it only once in
every 5 yrs.
2. Refund of cash surrender value
(CSV): 50% of total amt paid +
5% for every yr after the first 5
years of installments, BUT not >
90% of total amt paid
3. Notice of cancellation or demand
for rescission by notarial act,
effective 30 days from the buyers
receipt thereof and upon full
payment of the CSV
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the execution of a public instrument
(Sanchez v. Ramos, 1919)
B. CONVENTIONAL REDEMPTION
(Arts.1601-1618)
o Available when the seller reserves the
right to repurchase the thing sold in the
same instrument of sale as one of the
stipulations of the contract (Villarica v CA,
1968)
An agreement to repurchase becomes
a promise to sell when made after the
sale, because when the sale is made
without such an agreement, the
purchaser acquires the thing sold
absolutely, and if he afterwards grants
the vendor the right to repurchase, it
is a new contract entered into by the
purchaser, as absolute owner already
of the object. (Ramos v. Icasiano,
1927)
o Period for redemption:
- pd. stipulated, but NOT > 10 yrs; OR
- 4 yrs from date of contract, if no pd.
stipulated
o Available to:
1. Seller (or his agent/heirs/assigns)
2. Creditors of seller, AFTER they have
exhausted the sellers property
If co-owners, jointly and in the same
contract, sell an undivided immovable,
each may redeem only his respective
share
If a sole owner sells an immovable and
leaves several heirs, each heir may
redeem only his share.
In these 2 cases, the buyer a retro
may demand all the sellers a retro or
heirs to buy redeem the whole thing
and he cannot be compelled to agree
to a partial redemption.
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Enforceable against:
1. Buyer (or his agent/heirs/assigns)
If the land is registered, the right to
redeem must be annotated in the title
in order to prejudice a subsequent
buyer from the buyer a retro.
A buyer of a part of an undivided
immovable who acquires the whole
thereof may compel the seller to
redeem the whole property.
If the buyer leaves several heirs,
action to redeem may be brought
against each heir only for his own
share, WON the thing has been
partitioned, UNLESS in the partition,
one heir was awarded with the thing
sold, in which case he may be sued for
redemption of the whole thing
Redemption exercised by:
1. Returning the ff. to the buyer: (PEN)
a. Price of the sale;
b. Expenses of the contract and other
legitimate payments made by reason
of the sale;
c. Necessary and useful expenses
made on the thing sold
2. Complying with any other stipulation
agreed upon, if any.
The general rule in redemption is that
it is not sufficient that a person
offering to redeem manifests his desire
to do so. The statement of intention
must be accompanied by an actual and
simultaneous tender of payment for
the full amount of the repurchase
price. (BPI Family Savings Bank, Inc.
v. Veloso, 2004)
Tender of payment is enough (i.e.,
consignation is not necessary), if made
on time, as a basis for action against
the buyer to compel him to resell. But
that tender does not in itself relieve
the buyer from his obligation to pay
the price when redemption is allowed
by the court. (Paez v. Magno, 1949)
Effects of redemption:
1. The seller shall receive the thing free
from all charges or mortgages
constituted by the buyer BUT he shall
respect leases executed by the buyer
in good faith and in accordance with
local custom.
2. If there are growing fruits at the time
of sale and at the time of redemption:
no reimbursement or prorating if the
buyer did not pay indemnity at the
time of sale
3. If there were no growing fruits at the
time of sale, but some exist at the
time of redemption: fruits prorated
(buyer entitled to part corresponding
to time he possessed the land in the
last year, counted from the
anniversary of the date of sale)
Effect of non-redemption: Ownership
consolidated in the buyer BUT the
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Legal redemption
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To whom granted
Co-owner
(Art.1620, CC)
Adjoining owner of
rural land
(Art.1621,CC)
Adjoining owner of
urban land
(Art.1622,CC)
Period
30 days from notice
- in writing
- by the seller
- of the actual
execution and
delivery of the deed
of sale
*Actual knowledge
of the sale
immaterial
(Doromal v CA,
1975)
Debtor in case a
credit or
incorporeal right in
litigation is sold
(Art.1634)
Applicant or his
widow or legal
heirs in case of
sale of homestead
(Sec.119, Public
Land Act)
Taxpayer in case of
tax sale (Sec. 215,
NIRC)
Judgment debtor,
successorininterest, or creditor
with subsequent
lien, in case of
execution sale
(Rule 39, Sec.27,
ROC)
Debtor-mortgagor,
successors-ininterest,
judicial/judgment
creditor,
any
person having a
lien
on
the
property, in case of
extrajudicial
foreclosure of
mortgage (Act No.
3135. Sec. 6. )
debtor-mortgagor
in case of judicial
foreclosure of real
estate mortgage IF
the mortgagee is a
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finality of judgment
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To whom granted
bank or a banking
institution. (The
General Banking
Law of 2000)
Agricultural lessee
w/o knowledge of
sale of landholding
(Agrarian Land
Reform Code,
Sec.12)
o
Period
Redemption by co-owner
o Available when the shares of any or all of
the other co-owners are sold to a 3rd
person (anyone not a co-owner)
o If price grossly excessive, the
redemptioner shall pay only a reasonable
one.
o If 2 or more co-owners want to redeem:
they may do so in proportion to their
respective shares
o The right of redemption of co-owners
excludes that of adjoining owners.
Redemption by adjoining owner of rural land
o Available when the area of rural land is 1
hectare or less, unless the grantee does
not own any rural land.
o NOT available when the adjoining lands
are separated by brooks, drains, ravines,
roads, and other permanent servitudes for
the benefit of other estates
o Priority if 2 or more adjoining owners want
to redeem:
1. owner of smaller adjoining land;or
2. if with same area, owner who first
requested redemption
Redemption by adjoining owner of urban land
o Granted in addition to right of pre-emption
o Available when the urban land:
1. is so small and so situated that a major
portion of it cannot be used for any
practical purpose w/in a reasonable
time;
2. was bought merely for speculation;
and
3. was resold.
o Priority if 2 or more adjoining owners want
to redeem: owner whose intended use of
the land appears to be best justified
Redemption of credit or incorporeal right
o Available when it is sold while in litigation
(from the time the complaint is answered)
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X. ASSIGNMENT
o
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on the lots, which shall be utilized for
the development of the subdivision.
(Sec.35)
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REQUIREMENTS: (SPIN-C)
1. Sworn statement of list of creditors
2. Pro-rata application of the purchase or
mortgage money to the payment of listed
creditors
3. Inventory of the goods, wares,
merchandise, provisions or materials
4. Notice to listed creditors
5. Consideration for the sale, transfer,
mortgage or assignment
Sworn statement of list of creditors
o Contents:
1. names and addresses of all creditors of
seller or mortgagor
2. amount of indebtedness due or owing,
or to become due or owing to each
o When delivered: before receiving any part
of the purchase price, or any promissory
note, memorandum, or other evidence of
indebtedness therefor
o To who delivered:
- to such buyer, mortgagee, or agent; or
- if the buyer, mortgagee, or agent be a
corporation: to the president, vicepresident, treasurer, secretary or
manager of said corporation; or
- if such vendee or mortgagee be a
partnership firm: to a member thereof
Notice to creditors
o Contents: price, terms, and conditions of
the sale, transfer, mortgage or assignment
o When made: at least 10 days before
transferring possession
o How made: personally or by registered
mail
Consideration
- must not be nominal
EFFECT OF NON-COMPLIANCE:
o
Q 2007 BAR
Seeking to streamline its operations and to
bail out its losing ventures, the stockholders
of X Corporation unanimously adopted a
proposal to sell substantially all of
the
machineries and equipment used in and about
its manufacturing business and to sink the
proceeds of the sale for the expansion of its
cargo transport services.
(a) Would the transaction be covered by the
provisions of the Bulk Sales Law?
(b) How would X Corporation effect a valid
sale?
Inventory
o Contents:
1. quantity
2. cost price of each article, so far as
possible
o When made: at least 10 days before sale
or mortgage
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Agency
TABLE OF CONTENTS
Section
Section
Section
Section
Section
1.
2.
3.
4.
5.
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202
204
205
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NATURE, FORM, AND KINDS OF
AGENCY
there
must
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The rules on service of process make service
on "agent", whether general or special,
sufficient even if agent has limited authority.
An employee of a corporation may not be
deemed an agent under the above rule unless
his/her duties are so integrated to the
business that his/her absence or presence
wont toll the business operations (Aboitiz
Internatl Forwarders, Inc. v. CA, 2006).
1. Designation
by
parties
is
not
controlling.
2. Fact of existence: if relations that
constitute agency exist, there is
agency regardless of WON parties
understood the exact nature of the
relation.
3. No presumption of existence: agency
must exist as a fact.
Exceptions:
a) When agency arises ipso jure
b) To prevent unjust enrichment
4. Intention of the parties to create
relationship. As between principal and
3rd person, agency may exist without
the direct assent of the agent.
Against the principal, the agent has
the
obligation
to
determine
existence and scope of agency
Against the agent, the third person
has the obligation to determine
existence and scope of agencyThe
person dealing with the agent must
also act with ordinary prudence and
reasonable diligence. If he knows
or has good reason to believe that
the
agent
is
exceeding
his
authority,
he
cannot
claim
protection. [Harry Keeler Electric v
Rodriguez, 1922]
Agency vs. similar contracts
1. Partnership
a. An agent acts only for his principal; a
partner acts for his partners, the
partnership, and for himself.
b. Parity of standing test: A partnership
generally presupposes a parity of standing
between the partners-- equal proprietary
interest in the capital or property and
exercises equal rights in the conduct of the
business.
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agency
lease of service
Based on
representation.
Based on
employment.
Agent exercises
discretionary
powers.
Lessor ordinarily
performs only
ministerial
functions.
agency
Agent is controlled
by the principal.
Relates more to
matters of mere
manual or
mechanical
execution.
lease of property
Lessee is not
controlled by the
lessor.
4. Contract of sale
agency to sell
Agent receives the
goods as the
principals goods.
sale
Buyer receives the
goods as owner.
2. Independent contractor
Represents his
principal.
3. Lease
Agent
independent
contractor
Employed by the
employer.
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Agent in dealing with
the thing received is
bound to act
according to the
instructions of his
principal.
5. Guardianship
agency
guardianship
Guardian is
appointed by the
court and stands in
loco parentis.
2. As to formalities
Gen.
Rule:
No
formal
requirements
governing the appointment of an agent.
Except: When the law requires a specific
form, i.e. if the sale of a piece of land or any
interest therein is through an agent, the
agents authority shall be in writing, or the
sale is void. (Art. 1874, CC)
Note:
If
the
owner
himself
sells
realty/interest therein, if not made in
writing, the contract of sale is unenforceable
but subject to ratification (Art. 1403, par.
2(e), CC).
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3. As to cause or consideration
a. Gratuitous
b. Onerous:
there
is
compensation.
Agency
is
presumed
to
be
for
compensation (Art. 1875, CC)
4. As to extent of business covered
a. General: comprises all the
business of the principal; or
b. Special: comprises one or more
specific
transactions.
(Art.
1876, CC)
Universal agent: authorized to do all acts that
the principal may personally do, and which he
can lawfully delegate to another the power of
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doing. (Mechem, Sec. 58)
iii.
general
special
agent
agent
All acts
Specific acts
connected
in pursuance
with the
of particular
business or instructions
employment or with
in which he is restrictions
engaged.
necessarily
implied from
the act to be
done.
Involves
No continuity
continuity of of service.
service.
Scope of
authority
Nature of
service
authorized
Extent to
which agent
may bind the
principal
Termination
of authority
Construction Merely
of principals advisory in
instructions nature.
Cannot bind
his principal
in a manner
beyond or
outside the
specific acts
which he is
authorized to
perform.
Duty imposed
upon the 3rd
party to
inquire
makes
termination
of the
relationship
as between
the principal
and agent
effective as
to such 3rd
party, unless
the agency
has been
entrusted for
the purpose
of contracting
with such 3rd
party.
Strictly
construed as
they limit the
agents
authority.
5. As to authority conferred
a. Couched in general terms:
comprise
only
acts
of
administration, even if
i.
the principal states that he
withholds no power,
ii.
that the agent may execute
such acts as he may
consider appropriate, or
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b. Simple or commission: agent acts in
his own name but for the principals
account. (Art. 1883, CC)
c. Agency by estoppel: there is no
agency, and the alleged agent seemed
to have apparent or ostensible, but not
real, authority to represent another.
apparent
authority
authority by
estoppel
Implied Agency
Agency by
Estoppel
1. There is actual
agency; thus
with rights &
duties as an
agent.
1. There is no actual
agency; thus
without rights &
duties as an agent.
2. Principal alone
is liable.
2. If caused by the
principal, he is
responsible. If
caused by the agent,
he is responsible.
Provided, 3rd person
in good faith.
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Estoppel
Rests on prejudice.
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The substance of
estoppel is the
principals
inducement to
another to act to
his prejudice.
7. Kinds of principal
b)
a. Disclosed
b. Partially disclosed third is unaware of
the principals identity.
c. Undisclosed
General
rule:
If
the
principal
is
undisclosed, the agent is directly liable to
the person with whom he had contracted
as if the transaction were his own. (Art.
1883, CC)
Rationale: There is no representation.
Exception: When the contract involves
things belonging to the principal, in
order to protect 3rd persons against
possible collusion between the agent
and the principal. (Art. 1883, CC)
The agents who made a contract in their
own names may sue the third person.
(Behn Mayer & Co. v. Banco Espaol-Fil.)
The undisclosed principal cant sue the
third person on a contract concluded by
the agent in his own name (Smith Bell &
Co. v. Sotto Matti). His recourse is against
the agent.
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To act within
authority
the
scope
of
accordance
with
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Limits of authority
Binding only on the
operate vs those
principal and agent
who have/are
charged with
knowledge of them.
e) To be loyal
Obligation not to prefer own interest: agent is
liable for damages if, there being a conflict of
interests, he prefers his own (Art. 1889,
CC).
Exception:
a. The principal waives the benefit of the rule,
provided he does so with full knowledge of the
facts.
b. The interests of the agent are superior.
f) To borrow money
a. Agent empowered to borrow money:
agent may himself be the lender at
current rate of interest (Art. 1890, CC),
for there is no danger of damage to
principal.
b. Agent authorized to lend money: needs
the principals consent (Art. 1890, CC)
for he may be a bad debtor.
g)
To render accounts and
deliver things received by virtue
of the agency
Obligation to render accounts: agents duty to
account for and deliver to the principal all
money and property received by virtue of the
agency (Art. 1891, CC). If he fails to do so
or uses the money/property for his own use,
the agent is liable for estafa (Art. 315, RPC).
Stipulation exempting the agent from this
duty is void (Art. 1891, CC).
Inapplicability:
a. The agent or broker acted only as a
middleman (Domingo v. Domingo)
b. The agent or broker informed the principal
of the gift or bonus or profit he received from
the vendee, and the principal did not object.
c. A right of lien exists in favor of the agent.
d. Solutio indebiti
h) To
be
responsible
substitutes
for
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Effects of Substitution:
a. Substitution prohibited all the
substitutes acts are void (Art. 1892,
CC)
b. Substitution authorized agent is
released from responsibility unless
substitute is notoriously incompetent
or insolvent (Art. 1892, CC).
- if the substitute is the one designated
by the principal, agent is absolutely
exempted
c. Substitution
not
authorized,
not
prohibited valid if beneficial to the
principal
- if caused damage to principal, agent
is responsible for substitutes acts
(Art. 1892, CC) and principal with
right of action against substitute (Art.
1893).
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j)
To
answer
fraud/negligence
for
his
commission agent
Must be in
possession of the
goods of the
principal.
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commission agent
Engaged in the
purchase and sale,
for a principal, of
personal property
which has to be
placed in his
possession and
disposal.
Broker
Has no custody or
possession of the
thing he disposes;
merely acts as an
intermediary
between the sellers
and the buyer.
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excess of authority, the law doesnt say that a
third person can recover from both the
principal and the agent. (Eurotech Industrial
Technologies Inc. v. Cuizon, 2007)
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the day the advance was made, even if the
business wasnt successful (Art. 1912, CC).
Exceptions to the obligation of advancement/
reimbursement:
a. If the agent acted in contravention
of the principal's instructions, unless
principal derives benefits.
b. When the expenses were due to the
fault of the agent.
c. When the agent incurred them
knowing that an unfavorable result
would ensure, if the principal was
unaware thereof.
d. When it was stipulated that the
expenses would be borne by the agent,
or that the latter would be allowed only
a certain sum. (Art. 1918, CC)
Agents right to retain object of agency in
pledge: if the principal fails to reimburse the
agent (Art. 1914, CC). But agent isnt
entitled to the excess in case the thing was
sold to satisfy his claim, and the proceeds are
more than his claim (Arts. 2115, 2121, CC).
Also he must possess the thing lawfully in his
capacity as agent (2 C.J. 457).
When principals solidarily liable for the
agencys consequences:
a. There are 2/more principals;
b. They all concurred in the
appointment of the same agent;
and
c. The agent is appointed for a
common
transaction/undertaking. (Art.
1915, CC)
3. To indemnify
damages
the
agent
for
EXTINGUISHMENT OF AGENCY
Quick glance: Ways to extinguish agency
the
Mode
Way of
extinguishing
1. By the parties
subsequent acts
a.
Principals
revocation
agents
b. Agents withdrawal
2. By operation of law
- death
- civil interdiction
- insanity, or
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a.
By
the
principals/agents
- insolvency
b.
By
the
firms/corporations
dissolution
3. By agreement
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a. Accomplishment of
object/purpose
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4. Other modes
b.
Expiration
period
of
a. Other modes
extinguishment
obligations
of
of
b. Changes in law
c.
Changes
conditions
in
d. War
Modes of extinguishment (Art. 1919, CC)
1. By the subsequent acts of the parties
either by mutual consent or unilaterally.
a. By the principals revocation.
Revocation:
termination
by
the
subsequent acts of the principal. May be
express or implied. If the agents
authority is in writing, the principal may
compel him to return this document
(Art. 1920, CC).
Gen. rule: principal may revoke the
agency at will (Art. 1920,CC).
Except (BIW): 1. the revocation is done
in bad faith (Danon v. Brimo);
2. the agency is coupled with an
interest, such as when
a. a bilateral contract depends
on it;
b. its the means of fulfilling an
obligation already contracted;
c. a partner is appointed
manager of a partnership and
is removed unjustifiably. (Art.
1927, CC)
3. the principal waived his right
to revoke (New Manila Lumber
Co. v. Rep.)
Agency coupled with an interest cant be
terminated by the sole will of the
principal
since
third
persons
are
involved, though its revocable after the
interest ceases. The interest of the agent
must be in the subject matter of the
power conferred, and not merely in the
exercise of the power as it entitles him
to compensation. (Del Rosario v. Abad)
An agency coupled with interest may be
revoked when the agent acts to defraud
the principal. The irrevocability of the
power of attorney may not be used to
shield the perpetration of acts in bad
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Agency to contract
with general
public
Wont prejudice
3rd persons until
notice is given
them.
Wont prejudice
those in good faith
& w/o knowledge.
Notice must be
personal.
Notice may be
personal.
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CIVIL LAW
AGENCY
Revocation if with 2/more principals: one
of the principals may revoke the power
of attorney without the others consent
(Art. 1925, CC).
b. By
the
dissolution
firm/corporation.
2. By operation of law.
a. By the principals/agents death,
civil interdiction, insanity or
insolvency.
As theres an integration of the
principals personality into the agents,
its impossible for agency to continue
once the death of either is established.
(Rallos v. Felix Go Chan & Sons)
Except: 1. the agency is constituted in
the common interest of the principal and
agent, or in the interest of a 3rd person
who accepted the stipulation in his favor
(Art. 1930, CC).
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the
3. By agreement.
a. By the accomplishment
agencys object/purpose.
of
of
the
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CIVIL LAW
AGENCY
doesnt
give
instructions
4. Outbreak of war
him
new
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PARTNERSHIP
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Partnership
TABLE OF CONTENTS
Section
Section
Section
Section
Section
Section
Section
Section
Section
Section
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
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211
212
214
217
218
220
220
223
223
225
CIVIL LAW
PARTNERSHIP
NATURE; CREATION OF A
PARTNERSHIP
Essential Features
Contract of Partnership:
a. 2/more persons bind themselves
b. to contribute money, property, or
industry to a common fund,
c. with the intent of dividing the profits
among themselves. (Art. 1767, CC)
Essential features:
1. There must be a valid contract
2. The parties must have legal capacity
3. A mutual contribution of money, property,
or industry to a common fund
4. Has a lawful object (Art. 1770, CC)
5. The primary purpose is to obtain profits
and divide the same among the parties
Characteristics:
1. Fiduciary
2. Nominate
3. Consensual
4. Bilateral/multilateral
5. Principal
6. Onerous
7. Preparatory
8. With legal personality (Art. 1768, CC)
9. Profit oriented
Partnership
Created by mere
agreement of the
parties;
Corporation
Created
by
operation of law
May be organized
by
only
two
persons
Requires at least 5
incorporators;
Juridical
personality
commences from
the moment of
execution of the
contract
of
partnership
Personality
commences from
SECs issuance of
the certificate of
incorporation
If no agreement as
to mgt. - every
partner is an agent
of the partnership
Power
to
do
business is vested
in the board of
directors/ trustees
A partner as such
may sue a copartner
who
mismanages
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Has no right
succession
of
Has
right
succession
The stockholders
are liable to the
extent
of
the
shares subscribed
by them
Based on delectus
personam
Not
based
on
delectus personam
May be established
for any period of
time stipulated
May be dissolved
at anytime by the
will of any or all
partners
May be dissolved
only
with
the
consent
of
the
state
Governed by the
Civil Code
Governed by the
Corporation Code
Creation
Juridical
Personality
Purpose
Partnershi
p
Coownership
Always
created by a
contract
Gen., created
by law, may
exist
even
without
a
contract
Has
a
separate,
distinct
juridical
personality
Has
no
juridical
personality
Realization
of profits
Common
enjoyment of
a thing or
right
Duration
No limitation
upon
the
duration
is
set by law
Property cant
be undivided
for more than
10 years
Transfer of
Interests
Need
unanimous
consent
of
partners to
make
assignee of
interest
a
partner
A
co-owner
can
dispose
of his share
without
the
consent
of
the others
Power
to
act
with
Third
Persons
A
partner
may
bind
the
partnership
A
co-owner
cant
represent the
co-ownership
Dissolution
Death
or
incapacity of
a
partner
dissolves the
partnership
Death
or
incapacity of
a
co-owner
doesnt
dissolve the
co-ownership
Representa
-tion
There
mutual
agency
Profits
Must
be
stipulated
upon
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is
shares
and
any
stipulation to
the contrary
is void.
of
CLASSIFICATION OF
PARTNERSHIPS AND PARTNERS
Kinds of Partnerships
1.
2.
3.
4.
There is
mutual
agency
5.
6.
no
Must always
depend upon
proportionate
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As to nature
a. Commercial/trading
b. Professional
As to duration
a. With a fixed term - (Art. 1830[1a],
CC) unless continued by some/all the
partners (Art. 1785, CC)
b. At will (Art. 1785, CC)
As to legality of existence
a. De jure has complied with all the
necessary
requisites
for
lawful
establishment (Arts. 1772, 1773,
CC)
b. De facto failed to comply with the
requisites
As to representation to others
a. Ordinary/real really exists between &
among the partners themselves and as
to third persons
b. Ostensible/by estoppel deemed one
only in relation to transacting third
persons (Art. 1825, CC)
As to publicity
a. Open known to the public
b. Secret
As to its object
a. Universal (Art. 1777, CC)
i. As to all present property (Art. 1778,
CC)
ii. As to profits (Art. 1780, CC)
b. Particular (Art. 1783, CC)
As to partners liability
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CIVIL LAW
PARTNERSHIP
a. General liable pro rata (Art. 1816,
CC) or solidarily (Arts. 1822-1824,
CC)
b. Limited (Art. 1843, CC)
Types, Universal Partnership:
All present
property
All present property
actually owned by
partners
are
contributed
become
common
property
of
the
partnership & the
partners.
Only profits from the
property contributed
become
common
property;
other
profits
may,
by
stipulation,
be
considered
as
common property.
All profits
Property owned by
the partners when
the partnership was
formed continue to
pertain to them
only the usufruct
becomes
common
property
All profits acquired
through
partners
industry/work
become
common
property.
unless
expressly
permitted
(Art.
1789, CC)
8. As to liability
a. General/Real liability extend to
separate property (Art. 1776, CC)
b. Limited/Special only to extent of
contribution (Art. 1843, CC)
c. Capitalist-Industrial
9. As to management
a. Managing manages the firms affairs
b. Silent doesnt participate in
management
c. Liquidating winds up the affairs after
dissolution
10. Other special classifications
a. Subpartner related only to the
regular partner (Art. 1804, CC)
b. Retiring withdraws/retires from the
partnership
Industrialist
Partner
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Capitalist
Partner
Contribution
Contributes
his industry
Contributes
money
or
property
Prohibition
to engage in
other
business
Cannot
engage in any
business for
himself
Cant engage
in the same or
similar
enterprise
Profits
Receives
a
just
and
equitable
share
Shares
in
profits
according
to
agreement
thereon;
if
none, pro rata
to
his
contribution
Losses
Exempted as
to losses as
between
partners but
it is liable to
3rd
persons
without
prejudice to
reimburseme
nt from the
capitalist
partners
1. stipulation
as to losses
2. if none, the
agreement as
to profits
3. if none, pro
rata
to
contribution
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Separat
e
Situation
Who are
liable
no
existing
partner
ship
all
those
represented
as
partners
consented to
the
representatio
n or
existing
partner
ship
no
existing
partner
ship
person
who
represente
d/was
represente
d
as
a
partner
and
all
those who
consented
Existin
g
partner
ship
person
who
represente
d/was
represente
d
as
a
partner
and
all
those who
consented
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OBLIGATIONS OF PARTNERS
A. Contribute
of
goods
or
property
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CIVIL LAW
PARTNERSHIP
his failure to contribute or from time of
conversion (Art. 1788, CC)
b. payment of 12% interest as interest on
forbearance of money (Martinez v.
Ong Pang Co)
When money or property have been received
by a partner for a specific purpose and he
later misappropriated it, such partner is guilty
of estafa. (Liwanag v CA)
4. Bring to partnership capital credit
received
Equal contribution by general partners:
capitalist partners shall contribute equal
shares to the capital of the partnership (Art.
1790, CC).
5. Obligation of capitalist
contribute additional capital
partner
to
Risk is borne by
partner
Risk is borne by
partnership
Fungible
(consumable)
things
Risk is borne by
partnership
Things contributed to
be sold
Risk is borne by
partnership
6. Obligation
partner
Things brought
appraised
in
inventory
Risk is borne by
partnership
of
collecting
managing
Requisites:
a. 2 separate credits, both demandable,
b. one credit is owed to the partnership,
c. the other to the collecting partner whos a
managing partner.
Managing partner should:
a. If issued receipt for own account only
apply the sum to the 2 credits in proportion to
their amounts
b. Issued receipt for partnerships account
apply whole sum to partnerships credit (Art.
1792, CC)
7. Obligation of partner who receives
share of partnership credit
Receipt of share in partnership credit: if a
debtor made a partial payment of his debt to
the partnership, where a partner received his
share of the credit and the others havent,
and the debtor later becomes insolvent, the
partner who received his share shall bring to
the partnership capital what he received
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and
the
D. Mutual Agency
Appointed managing partners (MP) power:
execute all acts of administration despite his
partners opposition unless he acts in bad faith
(Art. 1800, CC). He has the powers of a
general agent and all incidental powers
essential for the carrying on of the firms
purposes.
If MP appointed in the articles of partnership:
power is irrevocable
Except: 1. with just, lawful cause
2. upon the vote of the partners
representing the controlling interest
(Art. 1800, CC)
If power granted after constitution of
partnership: revocable any time, for any
cause (Art. 1800, CC)
In case of conflict: if
1. 2/more partners are appointed MPs,
2. theres
no
specification
of
their
respective duties,
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wont be exempted insofar as his capital is
concerned (Paras).
The dismissal of the complaint to favor 1 of
the general partners doesnt increase the
remaining partners liability. (Island Sales v.
United Pioneers).
Liability of a newly-admitted partner:
1. obligations contracted before his admission:
liable only up to his share in the partnership
property
unless
theres
a
contrary
stipulation (Art. 1826, CC).
2. obligations contracted after admission:
liable as an ordinary original partner.
Liability of outgoing partner:
1.
when he gives notice of his retirement or
withdrawal, hes freed from liability on
contracts entered into thereafter but still
liable on existing incomplete contracts
2.
hes liable for goods sold & delivered
after his retirement/withdrawal if the sale
was pursuant to a contract made before such
retirement/withdrawal
H. Solidarily liable with partnership
Solidary liability of partnership & partners: for
everything chargeable to the partnership
under Arts. 1822-1823 (Art. 1824, CC).
This is an exception to Art. 1816 as it
involves torts.
OBLIGATIONS OF PARTNERSHIPS
A. Bear risk of loss
Partnership bears the risk: when what is
contributed is a fungible thing, thing which
cant be kept without deteriorating, if the
thing was contributed to be sold, and
contributions are appraised in the inventory
(Art. 1795, CC)
B. Reimburse
3 obligations of the partnership:
1. refund disbursements with legal interest
2. answer for obligations contracted in good
faith in the partnerships interest
3. answer for risks (Art. 1796, CC)
Partner = agent. Being a mere agent, he isnt
personally liable as long as hes not at fault
(Art. 1912, CC) and acted within the scope
of his authority. But unlike an ordinary agent,
the paying partner doesnt have the right of
retention if he isnt paid.
C. Operate under firm name
Other rules:
1.
a person continuing the partnership after
a dissolution uses the firm name/name of
deceased partner as part of the name:
deceased partners individual property isnt
liable for debts contracted (Art. 1840, CC)
2.
the limited partners surname shall not
appear in the firm name unless
a. its also the surname of a general
partner
b. before the limited partner became such,
the business had been carried on under a
name in which his surname appeared (Art.
1846, CC)
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according to
capital
contribution
3.Purely
industrial
partner
not
liable
for
losses
RIGHTS OF PARTNERS
A. Share in losses and profits
Rules for distribution of profits and losses,
(Art. 1797, CC)
OF
PROFITS
OF LOSSES
With
agreement
According to
agreement
According to
agreement
Without
agreement
1. Share of
capitalist
partner is in
proportion
to his capital
contribution
2. Share of
purely
industrial
partner
is
not fixed -
1. If sharing
of profits is
stipulated
apply
to
sharing
of
losses
2.If no profit
sharing
stipulated
losses
shall
be
borne
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as may be
just
and
equitable
under
the
circumstanc
es
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Where kept:
1. place agreed upon
2. if without agreement, at principal place of
business (Art. 1805, CC)
Reasonable
hours
on
business
days
throughout the year, not merely during some
arbitrary period of a few days chosen by the
managing partners (Pardo v. Lumber Co.)
D. Obtain formal account
Gen. rule: a partner isnt entitled to a formal
account, save in dissolution
Basis: his right of access to the books
Except:
1. if hes wrongfully excluded from the
business/possession of the property by his copartners
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PARTNERSHIP
2. if the right exists by agreement
3. as provided in Art. 1807
4. whenever other circumstances render it
just & reasonable (Art. 1809, CC)
The right of a partner to demand an
accounting exists as long as the partnership
exists. The prescription period begins to run
only upon the dissolution when the final
accounting is done (Fue Leung v. IAC).
E. Property rights
Property rights (Art. 1810, CC):
1. in the specific partnership property
2. in the partnership, and
3. to participate in the management
Partnership capital vs. partnership property
Capital
With a constant value
Includes
only
the
actual
capital
contributed
&
promised
to
the
partnership
Property
Value
varies,
in
accordance
with
market value
Includes
the
contribution
&
all
property later acquired
on the partnerships
account
Interfere
in
management;
the
Require
information
account
any
or
To
receive
the
assignors interest in
case of dissolution
To
receive
in
accordance with his
contract the profits
accruing
to
the
assigning partner
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What assignees
cannot do
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Title
in
partnership name
- Any partner may
convey
under
partnership name
Title
in
partnership name
- Conveyance in
partner's name
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Title in name of
1/ more partners,
Conveyance
in
name
if
partner/partners
in whose name
title stands
Title in name of
1/more/all
partners or 3rd
person in trust for
partnership,
Conveyance
executed
in
partnership name
of in name of
partners
RIGHTS OF PARTNERSHIPS
A. Acquire immovables
Immovables/an interest therein may be
acquired in the partnership name, and title so
acquired can only be conveyed in the
partnership name (Art. 1774, CC).
Cf Art. 1819: if the immovable is in the firms
name, it must be alienated in the name of the
firm; if its in the partner/s name, it must be
alienated in the name of said partner/s. If the
immovable is in the firms name but conveyed
by a partner or some of them in his/their
names, only the equitable interest is passed
to the buyer in good faith.
B. Preference of creditors
Preference: partnership creditors preferred to
creditors of individual partners (Art. 1827,
CC).
Remedy of private creditors of partners: seek
the attachment/public sale of the shares
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The death of 2 partners didnt disqualify the
partnership from being an awardee of a
foreshore lease, as it was survived by 7
partners who continued the operations of the
partnership. The death of a partner wont
disqualify the partnership from awards and
rights it had gained before the partners
death. (Lu Do and Lu Ym Corp. v. Aznar
Brothers Realty Co., 2006)
No profits gained after dissolution by death
will be due to the heirs, who are entitled only
to the profits already obtained at the time of
death. After death, the partnership was
merely
a
partnership
in
liquidation
(Bearneza v. Dequilla).
The partners cant enter into an agreement
where the automatic dissolution caused by law
will be limited/restricted (Lichauco v.
Lichauco).
2.Judicial causes (Art. 1831, CC)
a. On application by/for a partner when:
i. A partner is insane/of unsound mind
ii. A partner is incapable of performing his
part in the contract
iii. A partner is guilty of prejudicial acts
iv. A partner breaches the partnership
agreement
v. The business can only be carried on at a
loss
vi. Other equitable circumstances
b. On application by the buyer of partners
interest under Art. 1813 or 1814:
i. After the end of the specified term/agreed
undertaking
ii. Any time if its a partnership at will when
the partners interest had already been
assigned/charged
3.Membership changes (Art. 1840, CC)
(ARADE)
a. Admission of new member
b. Partners retirement
c. Assignment of rights in partnership
property
d. Death of a partner
e. Expulsion of a partner
Consequences of dissolution
1. As to partner's authority to act for the
partnership
Gen. rule: terminates the partners authority
to bind the partnership (Art. 1832, CC)
Exceptions:
a. to wind up partnership affairs and complete
unfinished transactions (Art. 1832, CC)
b. With respect to the partners (Art. 1833,
CC): if dissolved by act, death, or insolvency
of a partner, a partner remains liable to his
co-partners for his share of any liability
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damages
for
wrongful
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not
in
Business is
continued
Guilty partner shall i. have the value (in
cash or secured by a
bond) of his interest
in the partnership
less damages
ii. be released from
all the firms existing
liabilities
Expelled without
just case
Have all the rights of
an innocent partner
plus damages for his
unlawful exclusion
(Art. 1837, CC)
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PARTNERSHIP
c. To be indemnified by the supposed guilty
partner against all debts & liabilities of the
partnership (Art. 1838, CC).
9. Right of retiring/ deceased partner
When applicable: a partner retires/dies & the
business is continued without any settlement
of accounts
Except: no liquidation is necessary when
theres an agreement as to what the retiree
shall receive & he in fact received that amount
(Bonnevie v. Hernandez).
If no agreement, liquidation:
a. The retiree/legal rep. of the deceased may
have the value of the interest at the date of
dissolution.
b. He shall receive as an ordinary creditor an
amount equal to the value of his interest in
the partnership with interest or, in lieu of
interest, the profits attributable to the use of
his right in the property of the dissolved
partnership (Art. 1841, CC).
Art. 1809
Accounting
before
dissolution
LIMITED PARTNERSHIP
SETTLEMENT OF ACCOUNTS
BETWEEN PARTNERS (Art. 1839,
CC)
Limited partnership:
a.
formed by 2/more persons,
b.
in accordance with the requirements of
law,
c.
composed of 1/more general partners
& 1/more limited partners (Art. 1843, CC).
Limited
partners:
not
bound
by
the
partnerships obligations (Art. 1843, CC).
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Characteristics:
1. Complied with the statutory requirement
of form (Art. 1844 CC)
2. The business is controlled by 1/more gen.
partners who are personally liable to
creditors (Arts. 1848, 1850 CC)
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Limited
Partner
of
Personally
liable
for
partnership
obligations
Only to the
extent of his
capital
contributions
right
to
participate
in
managemen
t
If manner
of mgt. not
agreed
upon,
all
gen
partners
have
an
equal right
in business
mgt
No
participation in
management
contribution
Cash,
property or
industry
Cash
or
property only,
not industry
proper party
to
proceedings
by
or
against the
partnership
Proper
party
to
proceeding
s
by/against
partnership
Not
proper
party
to
proceedings
by/against
partnership
unless:
1. he is also a
gen. partner
2. where the
object of the
proceedings is
to enforce a
limited
partner's right
against
or
liability to the
partnership
Name
in
firm name
Name may
appear
in
firm name
Name
must
appear in firm
name
prohibition
to engage in
other
business
Prohibited
No prohibition
effect
of
retirement
death
insanity or
Dissolves
the
partnership
Different
effect; rights
transferred to
legal rep.
extent
liability
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insolvency
Assignability
of
interest
in
partnership
Creation
Not
assignable
Gen.
Partnership
In any form
unless
immovables
are contributed
Composition
Only gen.
partners
Firm name
Must contain
the word
Company
(SEC Memo
Circ. #14-00)
unless its a
professional
partnership
Assignable
Limited
Partnership
Executed in a
cert. of limited
partnership
containing the
required data,
duly signed &
sworn to by all
partners & filed
in the SEC
1/more gen.
partners and
1/more limited
partners
Name must
include the
word Limited
(SEC Memo
Circ. #14-00)
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CIVIL LAW
PARTNERSHIP
1. When the partnership is dissolved
2. When all limited partners cease to be such
(Art. 1864, CC)
Requirements to cancel:
1. Must be in writing
2. Signed by all the members
3. Filed with the SEC; if cancellation is courtordered, a certified copy of the order shall
also be filed (Art.1865, CC)
LIMITED PARTNER
Contribution
Restriction: only cash or
services (Art. 1845, CC).
property,
not
for
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of
the
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Effect of death (Art. 1861, CC)
Rights of executors/administrators:
1. All the rights of a limited partner for the
purpose of settling the estate
2. If the deceased had assigned his interest in
the
partnership,
the
executor
or
administrator may constitute the assignee a
substituted limited partner if the deceased was
empowered to do so
Dissolution
When a limited partnership may be dissolved:
1. The misconduct of a general partner
2. Fraud on the limited partner by the
general partner
3. The
retirement,
death,
insolvency,
insanity, or civil interdiction of a general
partner
Except: if the business is continued by the
remaining general partners
i. under a right stated in the cert.
ii. when all members consented to the
continuation (Art. 1860, CC)
4. When all the limited partners ceased to be
such (Art. 1864, CC)
5. End of the term for which it was to exist
(Art. 1844, CC)
6. By mutual consent of the partners before
the end of the firms original term
7. When the limited partner demanded the
return of his contribution but was
unjustifiably denied (Art. 1857, CC)
8. The causes in Arts. 1830 & 1831.
If dissolved by expiration of the fixed term:
the notice of dissolution need not be given
since the papers filed in the SEC are notice to
the world.
If dissolved by express will of the partners:
the certificate should be cancelled, and a
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CREDIT TRANSACTIONS
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Credit Transactions
TABLE OF CONTENTS
Section
Section
Section
Section
Section
Section
Section
Section
Section
Section
Section
1. Credit Transactions
2. Loan
3. Deposit
4. Guaranty
5. Legal and Judicial Bonds
6. Pledge, Mortgage, Antichresis
7. Concurrence and Preference of Credit
7. Special Laws
9. Warehouse Receipts Law
10. Insolvency Law
11. Sample Questions
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229
233
240
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255
256
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268
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LOAN
CREDIT TRANSACTIONS
include all transactions involving the purchase or
loan of goods, services or money in the present with
a promise to pay or deliver in the future (contract of
security)
BY
COLLATERAL
OR
AN
ENCUMBRANCE OF PROPERTY
2.
UNSECURED TRANSACTIONS
THOSE
THE
ANOTHER
PERSONAL
SUCH
AS
COMMITMENT
OF
GUARANTOR
OR
CHARACTERISTICS OF A LOAN:
1. real contract delivery is essential
for perfection of the loan (BUT a
promise to lend, being consensual, is
binding upon the parties)
2. unilateral contract - only the
borrower has the obligation
SURETY
2 KINDS OF LOAN:
Commodatum
nature
bailor delivers
to the bailee a
nonconsumable
thing so that
the latter may
use it for a
certain time
and return the
identical thing
Subject
matter
Nonconsumable
thing (Art
1936)
PARTIES IN BAILMENT
1. bailor the giver, the party who
delivers possession/custody of the
thing bailed
2. bailee the recipient, the party who
receives the possession/custody of the
thing delivered
KINDS OF CONTRACTUAL BAILMENT W/
REFERENCE TO COMPENSATION
1. for the sole benefit of the bailor
(gratuitous) e.g. gratuitous deposit,
mandatum (do some act w/ respect to
a thing)
2. for the sole benefit of the bailee
(gratuitous)
e.g.
commodatum,
gratuitous simple loan or mutuum
3. for the benefit of both parties e.g.
deposit for compensation, involuntary
deposit, pledge and bailments for hire:
a. hire of things temporary use
b. hire of service for work or labor
c. hire of carriage of goods for
carriage
d. hire of custody for storage
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Mutuum or
simple
loan
bailor
(creditor)
delivers to
the bailee
(debtor)
money or
other
consumable
thing upon
the
condition
that the
latter will
pay the
same
amount of
the same
kind and
quality
Money or
other
consumable
thing
Except: when
purpose of
contract is not
consumption,
but merely for
exhibition the
subject matter
may be a
consumable
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Transfer of
ownership
consideration
need to
return and
what
Nature of
property
involved
Purpose of
loan
WON return
may be
demanded
before end of
term
who suffers
the loss
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thing. In this
case, the use
is exhibition of
the thing, so
the
consumable
thing is not
being used in a
manner
appropriate to
its purpose,
but for another
purpose.
None,
ownership is
retained by
bailor (Art
1933)
None,
essentially
gratuitous (Art
1933)
Note that if
there is any
compensation,
the contract
that arises is a
lease contract
(Art. 1643)
Bailee must
return the
same thing
loaned (Art
1933)
May involve
real or
personal
property (Art
1937)
Loan for use
(Art 1935)
If the bailee is
not entitled to
the use of the
thing, the
contract may
be a deposit.
(Art 1962)
YES, in case of
urgent need
(Art 1946)
Bailor, since he
is the owner
(Art 1942, Art
1174)
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A thing is consumable when it is used in a
manner appropriate to its purpose or nature.
(Art 418)
COMMODATUM
Ownership
is
transferred
to the
debtor
May be
gratuitous
or onerous,
i.e. w/
stipulation
to pay
interest
debtor
needs only
to pay the
same
amount of
the same
kind and
quality
Only
personal
property
Loan for
consumption
NO, creditor
may not
demand its
return
before the
lapse of the
term agreed
upon
Debtor
suffers the
loss
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2 KINDS OF COMMODATUM:
1. ordinary commodatum - use by the
bailee of the thing is for a certain
period of time
2. precarium one whereby the bailor
may demand the thing loaned at will;
exists in cases where:
i. neither the duration of the
contract nor the use to
which the thing loaned
should be devoted has
been stipulated
ii. if the use of the thing is
merely tolerated by the
owner. (Art 1947)
General rule: In a commodatum, the right to
use is limited to the thing loaned, and not
to its fruits.
Except: There is stipulation to the
contrary. (Art 1940) In cases where
there is such a stipulation, enjoyment
of the fruits must be incidental to the
use of the thing itself. Otherwise, if the
use of the fruits is the main cause, the
contract ma be one of usufruct. (Art
562)
What is the effect of an accepted promise
to deliver by way of commodatum or
mutuum?
It is binding upon the parties, but the
contract of loan shall not be perfected
until delivery of the contract. (Art
1934)
Who may be bailor in commodatum?
Anyone. The bailor in commodatum
need not be the owner of the thing
loaned. (Art 1938)
But the bailee himself may not lend
nor lease the thing loaned to him to a
third person (Art 1939(2))
General rule: Commodatum is purely
personal in character. (Art 1939)
1. death of either party extinguishes the
contract
2. bailee can neither lend nor lease the
thing lent to him to a third person
Except: Members of the bailees household
may make use of the thing loaned
Except: Bailees household may NOT
use it when:
1.
there is stipulation to the
contrary, or
2.
the nature of the thing forbids
such use.
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Subject
matter
obligation
consideration
Loan
(both
kinds)
Money or any
other fungible
things
Obligation
to
return or to
pay
Loan may be
gratuitous
(commodatum)
barter
Non-fungible
things
Obligation to
give
an
equivalent of
that received
Barter
is
always
onerous
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b.
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a. when
judicially
demanded
as
provided in art 2122.
b. when there is an express stipulation
made by the parties that the interest
due and unpaid shall be added to the
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CHARACTERISTICS OF A DEPOSIT
1. Real like commodatum & mutuum;
bec its perfected by the delivery of the
subj matter. Where there is no
delivery, there is merely an agreement
to deposit w/c, however, is binding &
enforceable upon the parties. Hence, a
contract of future deposit is consensual
(see 1934 CC).
2. Unilateral if its gratuitous; bec only
the depositary has an oblig.
3. Bilateral if its for a compensation;
bec it gives rise to obligs on both the
depositary & the depositor.
4. Voluntary as a general rule. It
becomes necessary in the 3 cases in
1996 & 1998 CC and in cases of
deposit
of
goods
made
by
travelers/passengers
w/
common
carriers, which may also be regarded
as necessary.
5. Gratuitous as a general rule
Exceptions:
DEPOSIT
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. If the safekeeping of the
thing delivered is not the principal purpose of
the contract, there is no deposit but some
other contract. (Art. 1962)
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1. where
there
is
contrary
stipulation
2. where depositary engaged in
the business of storing goods
3. where property saved from
destruction w/o knowledge of
the owner
PRINCIPAL PURPOSE
Safekeeping of the thing delivered. (This is
why if its only an accessory or secondary
oblig of the recipient, deposit is not
constituted but some other contract).
1. Deposit v. Mutuum
Safekeeping
Purpose
or mere
custody
Depositor can
demand the
return of the
Demandability
subject
matter at will
Object
May be both
movable &
immovable
property
Consumption
of the Subj
Matter
Lender must
wait until the
expiration of
the period
granted to
the debtor
Only money
& other
fungible thing
2. Deposit v. Commodatum
Safekeepin
Transfer of
Purpose
g
the Use
May be
Essentially
Remuneratio
gratuitous
& always
n
gratuitous
In
Both
extrajudicia movable &
Object
l deposit,
immovable
only
property
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movable
things may
be the
object
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may be
the object
In whose
behalf
held
CREATION OF A DEPOSIT
1.
2.
3.
4.
EXTINGUISHMENT OF DEPOSIT
1. A deposit is extinguished:
a. upon the loss or deterioration of
the thing deposited;
b. upon
the
death
of
the
depositary, ONLY in gratuitous
deposits;
c. other provisions in the Civil
Code (novation, merger, etc.)
PARTIES TO A DEPOSIT
1. Ordinarily, there are only 2 persons
involved. Sometimes, however, the
depositary may be a 3rd person.
2. The main difference btw a voluntary
deposit & a necessary deposit is that in
voluntary deposit, the depositor has
complete freedom in choosing the
depositary, whereas in the latter, there
is lack of free choice in the depositor.
3. As a general rule, the depositor must be
the owner of the thing deposited.
However, it may belong to another
person than the depositor. For example,
when two or more persons claiming to
be entitled to a thing may deposit the
same with a third person. In such case,
the third person assumes the obligation
to deliver to the one to whom it belongs.
The depositary may bring an action of
interpleader to compel the depositors to
settle their conflicting claims. Here one
of the depositors is not the owner.
KINDS OF DEPOSIT
1. judicial
when an attachment or
seizure of property in litigation is
ordered
2. extrajudicial (Art. 1967)
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;
b. necessary- made in compliance
with a legal obligation, or on
the occasion of any calamity, or
by travelers in hotels and inns
or by travelers with common
carriers
creation
purpose
Subject
matter
Will of the
court
Security or
ensure the
right of a
party to
property or
to recover in
case of
favorable
judgment
Generally
immovables
Always
onerous
cause
Return
of thing
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Upon order
of the court/
end of
Depositor or
3rd person
designated
Judicial
litigation
Person who
has a right
Extrajudici
al
Will of the
contracting
parties
Custody and
safekeeping
Maybe
compensate
d but
generally
gratuitious
Upon
demand of
depositor
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EFFECTS OF INCAPACITY
Depositary is
capacitated;
Depositor is
incapacitated
Depositary is
incapacitated;
Depositary
is
subject to ALL the
obligations of a
depositary
Depositary
must
return
the
property either to:
a) the legal
representative of
the incapacitated,
OR
b) the depositor
himself if he
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Depositor is
capacitated
Depositary, however
is liable to:
a) return the thing
deposited while still
in his possession;
AND
b) pay the depositor
the amount by which
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should acquire
capacity
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Rationale
A deposit is founded on trust and
confidence and it can be supposed that
the
depositor,
in
choosing
the
depositary,
has
taken
into
consideration the latters qualification.
he may have
benefited himself
with the thing or its
price subject to the
right of any 3rd
person who acquires
the thing in good
faith
Exception
The depositary is
express stipulation.
obligations
by
b) General rule:
Depositary is liable for loss of the thing
deposited when:
(Art.
i.
Exception:
The depositary cannot excuse
himself from liability in the event of
loss by claiming that he exercised
the same amount of care toward
the thing deposited as he would
towards his own if such care is less
than
that
required
by
the
circumstances.
ii.
iii.
Rationale:
i. Essential requisite of judicial
relation which involves the
depositors confidence in his
good faith and trust worthiness;
ii. The
presumption
that
the
depositor took into account the
diligence which the depositary is
accustomed with respect to his
own property.
authorized
Exception:
There is an exemption from liability
when The thing is lost without the
negligence of the third person with
whom he was allowed to deposit the
thing if such third person is not
manifestly careless or unfit.
3. Obligation not to change the way
of deposit (Art. 1974)
General rule:
Depositary may not change the way of
the deposit
Exception:
If there are circumstances indicating
that the depositor would consent to the
change. This is a situation wherein the
depositary would reasonably presume
that the depositor would agree to the
change if he knows of the facts of the
situation.
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Requisites:
a) The depositary must notify the
depositor of such change and
b) Must wait for the reply of the
depositor to such change.
Exception: If the delay of the
reply would cause danger.
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i.
Exception:
When there is a stipulation to the
contrary.
6. Obligation not to make use of the
thing deposited (Art. 1977)
a) General rule:
Deposit is for safekeeping of the
subject matter and not for its use22.
by
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Exceptions:
a) If it is so stipulated;
b) If he uses the thing without the
depositors permission
c) If he delays in its return;
d) If he allows others to use it, even
though he himself may have been
authorized to use the same.
the
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General rule:
The
depositary
is
permitted
to
commingle grain or other articles of
the same kind and quality.
Exceptions:
a) Expressly authorized
depositor;
is
Effects:
a) The various depositors of the
mingled goods shall own the
entire mass in common.
b) Each depositor shall be entitled
to such portion of the entire as
the amount deposited by him
bears the whole.
8. Relation
between
depositor (Art. 1980)
bank
and
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thing
sealed
General rule:
The depositary has the obligation to:
a) return the thing deposited when
delivered closed and sealed in the
same condition;
b) pay for damages should the seal or
lock be broken through his fault,
which is presumed unless proven
otherwise;
c) Keep the secret of the deposit
when the seal or lock is broken,
with or without his fault.
Exception:
The depositary is justified in opening a
closed and sealed subject matter
a) When the depositary is presumed
authorized
to
do
so
(the
presumption applies if the key has
been delivered to him)
b) When the instructions of the
depositor as regards the deposit
cannot
be
executed
without
opening the box or receptacle.
(Necessity)
10.Obligation to return products,
accessories and accessions (Art.
1983)
11.Obligation to pay interest on sums
converted for personal use (Art.
1983)
12.The depositary who receives the
thing in deposit cannot require
that the depositor prove his
ownership over the thing (Art.
1984)
13.Where a third person appears to be
the owner. (Art. 1984)
The depositary may be relieved from
liability when:
a) He advised the true owner of the
thing of the deposit.
b) If the owner, is spite of such
information, does not claim it
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Exception:
(In the absence of stipulation) At the
place where the thing deposited might
be even if it should not be the same
place where the original deposit was
made.
General rule:
The thing deposited must be returned
to the depositor upon demand, even
though a specified period or time for
such return may have been fixed.
Exceptions:
a) When the thing is judicially
attached while in the depositarys
possession
b) When notified of the opposition of a
third person to the return or the
removal of the thing deposited
General rule:
The depositary may return the thing
deposited notwithstanding that a
period has been fixed for the deposit if:
a) The deposit is gratuitous;
b) The reason is justifiable.
General rule:
The depositary must be reimbursed for
loss suffered by him because of the
character of the thing deposited.
Exceptions:
a) Depositor was not aware of the
danger;
b) Depositor was not expected to
know the dangerous character of
the thing;
c) Depositor notified the depositary of
such dangerous character;
d) Depositary was aware of the
danger without advice from the
depositor.
Exception:
When the deposit is for a valuable
consideration, the depositary has no
right to return the thing before the
expiration of the time designated even
if he should suffer inconvenience as a
consequence.
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alienation is done in
FAITH:
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Extent of liability:
a) Liability in hotel rooms which come
under the term baggage or
articles such as clothing as are
ordinarily used by travelers
b) Include those lost or damages in
hotel annexes such as vehicles in
the hotels garage.
NECESSARY DEPOSITS
A deposit is necessary when:
1. It is made in compliance with a legal
obligation, in which case it is governed
by the law establishing it, and in case
of deficiency, the rules on voluntary
deposit e.g. Arts. 538, 586 and 2104
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hotel-
Elements:
a) They
have
been
previously
informed about the effects brought
by the guests; and
b) The
latter
have
taken
the
precautions prescribed regarding
their safekeeping.
the
JUDICIAL DEPOSIT
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GUARANTY
GUARANTY is a contract whereby a person,
called the guarantor, binds himself to the
creditor to fulfill the obligation of the principal
debtor in case the latter should fail to do so.
(Art. 2047)
CHARACTERISTICS
1. Accessory
dependent
for
its
existence upon the principal obligation
guaranteed by it;
2. Subsidiary and conditional takes
effect only when the principal debtor
fails in his obligation subject to
limitation
3. Unilateral
a. It gives rise only to a duty on
the part of the guarantor in
relation to the creditor and not
vice versa
b. It may be entered into even
without the intervention of the
principal debtor.
4. Guarantor must be a person distinct
from the debtor a person cannot be
the personal guarantor of himself
Purpose
Subject
Matter
Remunerati
on
In
whose
behalf it is
held
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Judicial
Deposit
By will of
the courts
Security;
Secure the
right of a
party
to
recover
in
case
of
favorable
judgment.
Either
movable or
immovable
property
but
generally,
immovable
Always
remunerate
d (onerous)
In behalf of
the person
who, by the
judgment,
has a right
Extrajudicial
Deposit
By will of the
parties.
Hence, there
is a contract
Custody;
Safekeeping
of the thing
CLASSIFICATION OF GUARANTY
1. Guaranty in the broad sense:
a. Personal guaranty is the
credit given by the person who
guarantees the fulfillment of the
principal obligation; or
b. Real guaranty is property,
movable, or immovable
i. Real mortgage (2124) or
antichresis
(2132)
guaranty is immovable
ii. Chattel mortgage (2140)
or pledge (2093)
guaranty is movable
2. As to its origin:
a. Conventional constituted by
agreement
of
the
parties
(2051[1])
b. Legal imposed by virtue of a
provision of law
c. Judicial required by a court to
guarantee the eventual right of
one of the parties in a case.
3. As to consideration:
a. Gratuitous guarantor does not
receive
any
price
or
remuneration for acting as such
(2048)
b. Onerous one where the
guarantor
receives
valuable
consideration for his guaranty
4. As to person guaranteed:
a. Single constituted solely to
guarantee
or
secure
performance by the debtor of
the principal obligation;
Only
movable
property
Generally
gratuitous,
but may be
compensate
d
In behalf of
the
depositor or
third person
designated
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b. Double or
sub-guaranty
constituted
to
secure
the
fulfillment by the guarantor of a
prior guaranty
5. As to its scope and extent:
a. Definite where the guaranty is
limited
to
the
principal
obligation only, or to a specific
portion thereof;
b. Indefinite or simple where the
guaranty
included
all
the
accessory obligations of the
principal, e.g. costs, including
judicial costs.
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8.
A
guaranty
may
secure
the
performance of a conditional obligation
1. Principal obligation subject to a
suspensive condition the guarantor is
liable only after the fulfillment of the
condition.
2. Principal obligation subject to a
resolutory condition the happening of
the condition extinguishes both the
principal obligation and the guaranty
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obligations
contract.
he
assumed
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under
his
undertaking
Secondarily liable
he contracts to
pay if, by the use
of due diligence,
the dent cannot be
paid
Primarily liable
undertakes directly
for the payment
without reference to
the solvency of the
principal, and is so
responsible at once
the latter makes
default, without any
demand
by
the
creditor upon the
principal
whatsoever or any
notice of default
Undertakes to pay if
the principal does
not pay, without
regard to his ability
to do so
Insurer
solvency
debtor
Rationale:
1. There be assurance that the guarantor
had the true intention to bind himself;
2. To make certain that on making it, the
guarantor
proceeded
with
consciousness of what he was doing.
11. A contract of guaranty is covered by
the Statute of Frauds
Guaranty must not only be expressed but
must so be reduced into writing. Hence, it
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, therefore,
of the agreement cannot be received without
the writing, or a secondary evidence of its
contents. However, It need not appear in a
public document.
GUARANTY
WARRANTY
DISTINGUISHED
WARRANTY
Contract by which a
person is bound to
another
for
the
fulfillment
of
a
promise
or
engagement of a
third party
An
undertaking
that the title,
quality,
or
quantity of the
subject matter of
a
contract
is
what it has been
represented
to
be, and relates
to
some
agreement made
ordinarily by the
party who makes
the warranty
DISTINGUISHED
Exception:
requirements
FROM
Liability
depends
upon
an
independent
agreement to pay
the obligation if
the primary debtor
fails to do so
Assumes liability as
a regular party to
the undertaking
Engagement
collateral
Charged
as
an
original promisor
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1. He possesses integrity;
2. He has capacity to bind himself;
3. He has sufficient property to answer
for the obligation which he guarantees.
SURETYSHIP
GUARANTY
is
the
the
FROM
GUARANTY
GUARANTY
SURETYSHIP
of
of
The
creditor
waives
the
Selection of Guarantor:
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1. Specified
person
stipulated
as
guarantor: Substitution of guarantor
may not be demanded
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is:
a. Term of the agreement;
b. As a party, the creditor is,
therefore, bound thereby.
2. Guarantor selected by the principal
debtor: Debtor answers for the
integrity, capacity, and solvency of the
guarantor.
3. Guarantor personally designated by the
creditor: Responsibility of the selection
should fall upon the creditor because
he considered the guarantor to have
the qualifications for the purpose.
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to
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obligation.
For
purposes
of
proportionate
reimbursement,
the
other guarantors may interpose such
defenses against the paying guarantor
as are available to the debtor against
the creditor, except those that are
personal to the debtor.
Exception:
Prior consent or subsequent ratification by the
debtor
EXTINGUISHMENT OF GUARANTY
4. The guarantor may proceed against
the debtor even before payment has been
made
General rule:
Guarantor has no cause of action against the
debtor until after the former has paid the
obligation.
Exceptions:
1. When he is sued for the payment;
2. In case of insolvency of the principal
debtor;
3. When the debtor has bound himself to
relieve him from the guaranty within a
specified period, and this period has
expired;
4. When
the
debt
has
become
demandable,
by
reason
of
the
expiration of the period for payment;
5. After the lapse of 10 years, when the
principal obligation has no fixed period
for its maturity, unless it be of such
nature that it cannot be extinguished
except within a period longer than 10
years;
6. If there are reasonable grounds to fear
that the principal debtor intends to
abscond;
7. If the principal debtor is in imminent
danger of becoming insolvent.
Rationale
To enable the guarantor to take measures for
the protection of his interest in view of the
probability that he would be called upon to
pay the debt. As such, he may, in the
alternative, obtain release from the guaranty;
or demand security that shall protect him
from any proceedings by the creditor; and
against the insolvency of the debtor.
EEFECTS OF GUARANTY AS BETWEEN COGUARANTORS
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NOT
ENTITLED
NOTE: Surety
exhaustion
not
entitled
to
TO
is
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PLEDGE, MORTGAGE,
ANTICHRESIS
pledge
Constituted on
movables.
Property is
delivered to the
pledgee, or by
common consent to
a 3rd person.
Not valid against 3rd
persons unless a
description of the
thing pledged and
the date of the
pledge appear in a
public instrument.
may be
IMPORTANT POINTS
mortgage
Constituted on
immovables.
Delivery not
necessary.
IMPORTANT POINTS
1) Debtor-owner bears the risk of loss of the
property.
2) Pledge or mortgage is indivisible.
Exceptions:
a) Where
each
of
several
things
guarantees a determinate portion of
the credit.
b) Where only a portion of loan was
released.
c) Where
there
was
failure
of
consideration.
3) Rule that real property, consisting of
several lots should be sold separately,
applies to sales in execution, and not to
foreclosure of mortgages.
4) The mere embodiment of a real estate
mortgage and a chattel mortgage in one
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27
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CHARACTERISTICS
1) Real Perfected by delivery.
2) Accessory Has no independent existence
of its own.
3) Unilateral Creates obligation solely on
the part of the creditor to return the thing
subject upon the fulfillment of the principal
obligation.
4) Subsidiary Obligation incurred does not
arise until the fulfillment of the principal
obligation.
CAUSE OR CONSIDERATION
1) Principal obligation In so far as the
pledgor is concerned.
2) Compensation stipulated for the pledge or
mere liberality of the pledgor If pledgor
is not the debtor.
PROVISIONS
PLEDGE
APPLICABLE
ONLY
TO
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becoming
IMPORTANT POINTS
1) As a general rule, the mortgagor retains
possession of the property. He may deliver
said property to the mortgagee without
altering the nature of the contract of
mortgage.
2) It is not an essential requisite that the
principal of the credit bears interest, or
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INCIDENTS OF REGISTRATION OF
MORTGAGE
1) Mortgagee is entitled to registration of
mortgage as a matter of right.
2) Proceedings for registration do not
determine validity of the mortgage or its
effect35.
3) Registration is without prejudice to better
rights of third parties.
4) Mortgage deed, once duly registered,
forms part of the records for the
registration of the mortgaged property.
5) Mortgage by a surviving spouse of his/her
undivided share in the conjugal property
can be registered.
FORECLOSURE OF MORTGAGE
It is the remedy available to the mortgagee by
which he subjects the mortgaged property to
the satisfaction of the obligation secured by
the mortgage.
KINDS OF FORECLOSURE
1) Judicial.
- Rule 68, ROC:
May be availed of by bringing an action
in the proper court which has
jurisdiction over the area wherein
the real property involved or a
portion thereof is situated.
If the court finds the complaint to be
well-founded, it shall order the
mortgagor to pay the amount due
with interest and other charges
within a period of not less than 90
days nor more than 120 days from
the entry of judgment
If the mortgagor fails to pay at the
time directed, the court, upon
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NATURE
OF
JUDICIAL
FORECLOSURE PROCEEDINGS:
a) Quasi in rem action.
b) Foreclosure is only the result or
incident of the failure to pay debt.
c) Survives death of mortgagor.
2) Extrajudicial.
- Act No. 3135, as amended:
a) Express authority to sell is given to
the mortgagee.
b) Authority is not extinguished by
death of mortgagor or mortgagee.
c) Public sale should be made after
proper notice.
d) Surplus proceeds of foreclosure
sale belong to the mortgagor.
e) Debtor has the right to redeem the
property sold within 1 year from
and after the date of sale.
f) Remedy of party aggrieved by
foreclosure is a petition to set aside
sale and cancellation of writ of
possession.
- Nature of power of foreclosure by
extrajudicial sale:
a) Conferred
for
mortgagees
protection.
b) An ancillary stipulation.
c) A prerogative of the mortgagee.
- Both
should
be
distinguished
from
execution sale governed by Rule 39, ROC.
- Foreclosure retroacts to the date of
registration of mortgage.
- A stipulation of upset price, or the
minimum price at which the property shall
be sold to become operative in the event
of a foreclosure sale at public auction, is
null and void.
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CHARACTERISTICS
1. Accessory contract it secures the
performance of a principal obligation
2. formal contract it must be in a
specified form to be valid (Art. 2134)
SPECIAL REQUISITES:
1. it can cover only the fruits of an
immovable property
2. delivery of the immovable is necessary
for the creditor to receive the fruits
and not that the contract shall be
binding
3. amount of principal and interest must
be specified in writing
4. express agreement that debtor will
give possession of the property to
creditor and that the latter will apply
the fruits to the interest, if any, then to
the principal of his credit
5. NOTE: The obligation to pay interest is
not of the essence of the contract of
antichresis; there being nothing in the
Code to show that antichresis is only
applicable to securing the payment of
interest-bearing
loans.
On
the
contrary, antichresis is susceptible of
guaranteeing all kinds of obligations,
pure or conditional
REDEMPTION
1) It is a transaction by which the mortgagor
reacquires the property which may have
passed under the mortgage or divests the
property of the lien which the mortgage
may have created36.
2) Kinds:
a) Equity of redemption: Right of the
mortgagor to redeem the mortgaged
property after his default in the
performance of the conditions of the
mortgage but before the sale of the
mortgaged property or confirmation of
sale
b) Right of redemption: Right of the
mortgagor to redeem the property
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Antichresis
Refers to real
property
Perfected by mere
consent
Consensual contract
Antichresis
Property
is
delivered to creditor
Creditor
acquires
only the right to
receive the fruits of
the property, hence,
it does not produce
a real right
The creditor, unless
there is stipulation
to the contrary, is
obliged to pay the
taxes and charges
upon the estate
It
is
expressly
2008
Pledge
Refers to personal
property
Perfected by
delivery of the thing
pledged
Real contract
Real Mortgage
Debtor
usually
retains possession
of the property
Creditor does not
have any right to
receive the fruits,
but the mortgage
creates a real right
over the property
The creditor has no
such obligation
There
is
no
such
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stipulated that the
creditor
given
possession of the
property shall apply
all the fruits thereof
to the payment of
interest, if owing,
and thereafter to
the principal
Subject matter of
both is real property
CIVIL LAW
obligation on part of
mortgagee
OBLIGATIONS OF ANTICHRETIC
CREDITOR
1. to pay taxes and charges on the
estate,
including
necessary
expenses
Creditor may avoid said obligation
by:
a. compelling debtor to reacquire
enjoyment of the property
b. by stipulation to the contrary
2. to apply all the fruits, after
receiving them, to the payment of
interest, if owing, and thereafter to
the principal
3. to render an account of the fruits
to the debtor
4. to bear the expenses necessary for
its preservation and repair
REMEDIES OF CREDITOR IN CASE OF
NON-PAYMENT OF DEBT
1. action for specific performance
2. petition for the sale of the real
property as in a foreclosure of
mortgages under Rule 68 of the Rules
of Court
the parties, however, 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. 68 Phil 712)
a
stipulation
authorizing
the
antichretic creditor to appropriate
the property upon the non-payment
of the debt within the agreed
period is void (Art. 2088)
IF
THE
MOVABLE,
INSTEAD
OF
BEING
chattel mortgage
Involves movable
property.
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pledge
Involves movable
property.
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Delivery of the
personal property
is NOT necessary.
Registration is
necessary for
validity.
Procedure: Sec. 14
of Act 1508, as
amended.
If the property is
foreclosed, the
excess over the
amount due goes
to the debtor.
Creditor is entitled
to deficiency from
the debtor EXCEPT
if it is a security for
the purchase of
personal property
in installments.
Delivery of the
personal property is
necessary.
Registration is NOT
necessary for
validity.
Procedure: Art.
2112, CC.
If the property is
sold, the debtor is
not entitled to the
to the excess
UNLESS it is
otherwise agreed
or in case of legal
pledge.
Creditor is not
entitled to recover
deficiency
notwithstanding
any stipulation to
the contrary.
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CIVIL LAW
RIGHT OF REDEMPTION
1. When the condition of a chattel mortgage
is broken, the following may exercise
redemption:
a. Mortgagor.
b. Person
holding
a
subsequent
mortgage.
c. Subsequent attaching creditor.
2. An attaching creditor who so redeems
shall be subrogated to the rights of the
mortgagee and entitled to foreclose the
mortgage in the same manner as a
mortgagee.
3. Redemption is made by paying or
delivering o the mortgagee the amount
due on such mortgage and the costs and
expenses incurred by such breach of
condition before the sale.
FORECLOSURE OF CHATTEL MORTGAGE
1. Public sale.
2. Private sale There is nothing
immoral or against public order
agreement for the private sale
personal properties covered by
mortgage.
illegal,
in an
of the
chattel
PERIOD TO FORECLOSE
1. After 30 days from the time of the
condition is broken.
2. The 30-day period is the minimum period
after violation of the mortgage condition
for the creditor to cause the sale at public
auction with at least 10 days notice to the
mortgagor and posting of public notice of
time, place, and purpose of such sale, and
is a period of grace for the mortgagor, to
discharge the obligation.
3. After the sale at public auction, the right of
redemption is no longer available to the
mortgagor.
CIVIL ACTION TO RECOVER CREDIT
1. Independent action not required.
2. Mortgage lien is deemed abandoned by
obtaining a personal judgment.
RIGHT OF MORTGAGEE TO RECOVER
DEFICIENCY
1. Where mortgage foreclosed: Creditor may
maintain action for deficiency although The
Chattel Mortgage Law is silent on this
point, because a chattel mortgage is given
only as a security and not as payment of
the debt.
2. Where mortgage constituted as security
for purchase of personal property payable
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CONCURRENCE
OF
CREDIT
implies
possession by two or more creditors of equal
right or privileges over the same property or
all of the property of a debtor.
PREFERENCE OF CREDIT is the right held by
a creditor to be preferred in the payment of
his claim above other out of the debtors
assets.
GENERAL PROVISIONS
1) The debtor is liable with all his property,
present and future, for the fulfillment of
his obligations, subjects to exemptions
provided by law.
- Exempt property:
a. Present property:
1. Family home. (Arts. 152, 153
and 155, CC)
2. Right to receive support, as well
as money or property obtained
by such support, shall not be
levied upon on attachment or
execution. (Art. 205, CC)
3. Sec. 13, Rule 39, ROC.
4. Sec 118, Public Land Act. (CA
141, as amended)
b. Future property: A debtor who
obtains a discharge from his debts
on account of insolvency, is not
liable for the unsatisfied claims of
his creditors with said property.
(Sec. 68 and 69, Insolvency Law,
Act 1956)
c. Property in custodia legis and of
public dominion.
2) Insolvency shall be governed by the
Insolvency Law. (Act 1956, as amended)
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3) Exemption of conjugal
property or
absolute community or property, provided
that:
- Partnership or community subsists.
- Obligations of the insolvent spouse
have not redounded to the benefit of
the family.
4) If there is co-ownership, and one of the
co-owners is the insolvent debtor, his
undivided share or interest in the property
shall be possessed by the assignee in
insolvency proceedings because it is part
of his assets.
5) Property held by the insolvent debtor as a
trustee of an express or implied trust,
shall be excluded from the insolvency
proceedings
CLASSIFICATION OF CREDITS
1) Special preferred credits. (Art. 2241 and
2242, CC)
a) Considered as mortgages or pledges of
real or personal property or liens
within the purview of legal provisions
governing insolvency.
b) Taxes due to the State shall first be
satisfied.
2) Ordinary preferred credits (Art. 2244)
Preferred in the order given by law.
3) Common credits (Art. 2245) Credits of
any other kind or class, or by any other
right or title not comprised in Arts. 22412244 shall enjoy no preference.
ORDER OF PREFERENCE OF CREDIT
1) Credits which enjoy preference with
respect to specific movables exclude all
others to the extent of the value of the
personal property to which the preference
refers.
2) If there are 2 or more credits with respect
to the same specific movable property,
they shall be satisfied pro rata, after the
payment of duties, taxes and fees due the
State or any subdivision thereof
3) Those credits which enjoy preference in
relation to specific real property or real
rights exclude all others to the extent of
the value of the immovable or real right to
which the preference refers.
4) If there are 2 or more credits with respect
to the same specific real property or real
rights, they shall be satisfied pro rata,
after the payment of the taxes and
assessment of the taxes and assessments
upon the immovable property or real right.
5) The excess, if any, after the payment of
the credits which enjoy preference with
respect to specific property, real or
personal, shall be added to the free
property which the debtor may have, for
the payment of other credits.
6) Those credits which do not enjoy any
preference
with
respect
to
specific
property,
and
those
which
enjoy
preference, as to the amount not paid,
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SPECIAL LAWS
WAREHOUSE RECEIPTS LAW
SCOPE
All warehouses, whether public or private,
bonded or not.
APPLICATION
The special law applies to warehouse receipts
issued by a warehouseman as defined in Sec.
58(a); while the Civil Code, to other cases
where receipts are not issued by a
warehouseman.
WHO MAY ISSUE WAREHOUSE RECEIPTS
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OR
LEVY
ON
NEGOTIABLE
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the debtor from imprisonment, and either
may operate on the petition of the debtor or
that of his creditors.
a. warehouseman is NOT liable for nondelivery even if the receipt was given for
the goods when they were deposited be
negotiated
b. when the sale was made without the
publication required and before the time
specified by law, such sale is void and the
purchaser of the goods acquires no title in
them
INSOLVENCY LAW
INSOLVENCY state of a person whose
liabilities are more than his assets. It is the
inability of a person to pay his debys as they
become due in the ordinary course of
business.
Balance Sheet Test relative condition of a
mans assets and liabilities that the former if
all made immediately available, would not be
sufficient to discharge the latter.
Equity Test a person may be insolvent
although he may be able to pay his debts at
some future time on a settlement and winding
up of his affairs.
INSOLVENCY vs. BANKRUPTCY
The only distinction between insolvency
and bankruptcy is a matter of
terminology and the source of the laws
relating thereto.
Either a bankruptcy or insolvency statute may
operate to discharge a debt as well as release
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SUSPENSION OF PAYMENTS
postponement, by court order, of the
payment of debts of one who, while
possessing sufficient property to cover his
debts, foresees the impossibility of meeting
them when they respectively fall due.
PURPOSE:
To suspend or delay the payment of
debts the amount of which is not affected
although a postponement is declared.
BASIS:
Probability of the debtors inability to
meet his obligations when they
respectively fall due, despite the fact that
he has sufficient assets to cover all his
liabilities.
REQUISITES OF PETITION FOR SUSPENSION
OF PAYMENTS:
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EFFECT OF COURT
DEBTOR INSOLVENT
Purpose
Sufficie
ncy of
property
Effect
on
amount
of debt
Number
of
creditor
s
required
suspension
of payments
Suspend or
delay the
payment of
debts
Debtor has
sufficient
property to
pay his debts
Amount of
indebtedness
is not affected
Number of
creditors is
immaterial
insolvency
Discharge the
debtor from
the payment of
debts
Debtor does
not have
sufficient
property to
pay all his
debts
The creditors
receive less
than their
credits, and in
case where
there are
preferences,
some creditors
may not
receive any
amount at all
In case of
involuntary
insolvency,
three or more
creditors are
required
INVOLUNTARY
INSOLVENCY
an
adjudication of insolvency may be made on
the petition of three or more creditors,
residents of the Philippines, whose credits or
demands accrued in the Philippines, and the
amount of which credits or demands are in
the aggregate of not less than P1,000.00
DISTINCTIONS BETWEEN VOLUNTARY
INSOLVENCY AND INVOLUNTARY
INSOLVENCY
voluntary
insolvency
One creditor
is sufficient
involuntary
insolvency
Three or more
creditors are
required
Who may
petition
Filed by the
insolvent
debtor
Acts of
insolvency
Debtor
must not be
guilty of
any of the
acts of
insolvency
(Sec. 20)
The amount
of
indebtednes
s must
exceed
P1,000.00
Bond is not
required
Filed by three
or more
creditors who
possess the
qualifications
required by
law
Debtor must
have
committed
one or more
of such acts of
insolvency
Number of
creditors
Amount of
debt
Posting of
bond
Ex parte
adjudication
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DECLARING
1.
ORDER
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An order of
adjudication
may be
Amount must
not be less
than
P1,000.00
(aggregate)
Petition must
be
accompanied
by a bond
An order of
adjudication
granted only
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Residency
duration to
vest
jurisdiction
in courts
Requirement
of hearing
granted ex
parte
Petition is
filed in the
RTC of the
province or
city where
the debtor
has resided
for six
months
Court issues
the order of
adjudication
declaring
the
petitioner
insolvent
upon the
filing of the
voluntary
petition
CIVIL LAW
control of the property is vested in
the court.
3. All actions to recover all the estate,
debts, and effects of the insolvent shall
be brought by the assignee and not by
the creditors.
4. The assignment shall:
a. Dissolve
any
attachment
levied within one month next
preceding the commencement
of insolvency proceedings;
b. Vacate and set aside judgment
entered
in
any
action
commenced within 30 days
immediately
prior
to
the
commencement of insolvency
proceedings;
c. Vacate and set aside execution
issued thereon;
d. Vacate and set aside any
judgment entered by default or
consent of the debtor within 30
days
prior
to
the
commencement of insolvency
proceedings
after a hearing
Length of
residence is
immaterial
The debtor is
not
adjudicated
insolvent until
after hearing
of the case
EFFECTS OF ASSIGNMENT38
1. Assignee takes the property in the
plight and conditions that the insolvent
held it.
2. Upon appointment, the legal title to
all the property of the insolvent is
vested in the assignee, and the
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4.
5.
6.
7.
CIVIL LAW
UP
OF
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AND
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RIGHTS
OF
COMPOSITION
An agreement, made upon a sufficient
consideration, between an insolvent or
embarrassed debtor and his creditors,
whereby the latter for the sake of immediate
or sooner payment, agree to accept a
dividend less than the whole amount of their
claims, to be distributed pro rata, in discharge
and satisfaction of the whole debt.
composition
Designates an
arrangement
between a debtor
and the whole
body of his
creditors (or at
least a
considerable
portion of them)
for the liquidation
of their claims by
the dividend
offered.
REQUIREMENTS
COMPOSITION
1. Mere
recommendation
assignee be appointed;
2. Voting of a secured claim.
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that
the
FOR
VALID
OFFER
OF
An agreement between
a debtor and a single
creditor for a discharge
of the obligation by a
part payment or on
different terms.
SECURED
accord
EFFECTS
OF
COMPOSITION
CONFIRMATION
OF
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Discharge
takes
commencement
of
insolvency.
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effect
from
the
the
proceedings
in
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CIVIL LAW
cases
mentioned
in
the
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BE
TAKEN
TO
THE
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SAMPLE QUESTIONS
a. What are the preferred claims that shall be
satisfied first from the assets of an insolvent
corporation?
How shall the remaining non-preferred
creditors share in the estate of the insolvent
corporation above?
Multiple choice: Choose the right answer.
1. The parties to a bailment are the:
a. bailor;
b. bailee;
c. comodatario;
d. all the above;
e. letters a and b
2. A deposit made in compliance with a legal
obligation is:
a. an extrajudicial deposit;
b. a voluntary deposit;
c. a necessary deposit;
d. a deposit with a warehouseman;
e. letters a and b
3. A contract of antichresis is always:
a. a written contract;
b. a contract, with a stipulation that the
debt will be paid through receipt of the
fruits of an immovable;
c. Involves the payment of interests, if
owing;
d. All of the above;
e. Letters a and b
4. An, assignee in a proceeding under the
Insolvency Law does not have the duty of:
a. suing to recover the properties of the
state of the insolvent debtor;
b. selling property of the insolvent
debtor;
c. ensuring that a debtor corporation
operate the business efficiently and
effectively while the proceedings are
pending;
d. collecting and discharging debts owed
to the insolvent debtor.
5. In order to obtain approval of the proposed
settlement of the debtor in an insolvency
proceeding.
a. the court must initiate the proposal
b. 2/3 of the number of creditors should
agree to the settlement;
c. 3/5 of the number of creditors should
agree to the settlement;
d. 1/3 of the total debts must be
represented by the approving
creditors;
e. Letters a and b
Before he left for Riyadh to work as a
mechanic, Pedro left his Adventure van with
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271
271
272
280
281
282
285
287
Title 2. Damages
I. Definition and Concept
II. Kinds of Damages
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288
288
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D. How is a quasi delict different from a
crime?
TORTS
Quasi-delict
Crime
public interest
RPC punishes and
corrects the act
I. IN GENERAL
A. What is a TORT?
Essentially, "tort" consists in the violation of a
right given or the omission of a duty imposed
by law. Tort is a breach of a legal duty.
(Naguiat vs. NLRC)
A tort is civil wrong, other than breach of
contract, for which a court of law will afford a
remedy in the form of an action for damages.
Elements:
1)
2)
3)
4)
punishes
only
when there is a
penal
law
covering the act
subsidiary liability
of employer
ERs defense is
that employees
resources
must
first be exhausted
(Barredo vs. Garcia)
private concern
CC
repairs
the
damage
by
indemnification
includes all acts in
which "any kind of
fault or negligence
intervenes."
solidary liability of
employer
ERs defense is that
accused observed due
diligence of a good
father of a family
A legal duty
Breach
Causation
Damage
B. What is a 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 and is governed by the
provisions of the Civil Code Chapter on quasidelicts. (Art. 2176)
QUASI
DELICT
Negligent
act/
omission
(culpa,
imprudence)
Proof
Neede
d
Preponder
ance
of
evidence
Preponderan
ce
of
evidence
Defens
e
availab
le
Exercise of
extraordin
ary
diligence
(in
contract of
carriage),
Force
Majeure
Preexistin
g
contra
There
is
preexisting
contract
Exercise of
diligence of
good father
of a family
in
the
selection
and
supervision
of
employees
No
preexisting
contract
Vinculu
m Juris
Elements:
1)
2)
3)
4)
5)
Act or omission
Damage or injury is caused to another
Fault or negligence is present
There are no pre-existing contractual
relations between the parties
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DELICT
Act/omis
sion
committ
ed
by
means
of dolo
(delibera
te,
maliciou
s, in bad
faith)
Proof
beyond
reasona
ble
doubt
No preexisting
contract
CIVIL LAW
3. And most commonly, good father of
the family or bonus paterfamilias
ct
Burden
of proo
f
Contractu
al
party.
Prove the
ff.:
1. existen
ce of a
contra
ct
2.
breach
Victim.
Prove the
ff.:
1. damage
2. negligen
ce
3. causal
connecti
on
between
negligen
ce
and
damage
done
Prosecut
ion.
Accused
is
presume
d
innocent
until the
contrary
is
proved.
Legal duty
Breach
Causation
Damage
F. Who has
negligence?
the
burden
of
proving
B. What is NEGLIGENCE?
Negligence is lack of due care required by a
particular situation, conduct which falls below
the standard required by law. (US vs. Barias,
1912)
An accident pertains to an unforeseen event in
which no fault or negligence attaches to the
defendant. (Jarco Marketing vs. CA, 1999)
C. What is the relation of negligence to the
elements of negligence tort?
Negligence is the breach (element no. 2) of
the legal duty (element no. 1) to observe a
certain standard of conduct in a particular
situation.
D. What are the tests of negligence?
Since negligence is the lack of due care
required by the circumstances, the test is
whether due care was observed.
Other cases:
There is prima facie presumption of
negligence on the part of the DEFENDANT if
the death or injury results from his possession
of dangerous weapons or substances, such as
firearms and poison, EXCEPT when the
possession or use thereof is indispensable in
his occupation or business. (Art. 2188)
Elsewhere, the Civil Code provides for other
instances where negligence is presumed.
Example: Art. 1756 regarding common
carriers.
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CIVIL LAW
I. What is CAUSATION?
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CIVIL LAW
It depends.
DISPUTABLE in the ff. cases:
violation creates a prima facie case of
negligence
violation
constitutes
evidence
of
negligence
The defense that the violation was either
justifiable
or
excusable
under
the
circumstances of the case is available. The
legal grounds or excuse for violation of a
statute:
1. Anything that would make complying
with the statute IMPOSSIBLE;
2. Anything over which the defendant has
NO CONTROL and places him in a
position contrary to that required by
the statute;
3. An EMERGENCY not of the defendants
making causing him to violate the
statute; and
4. Conduct that is precisely excused or
EXEMPTED by the statute.
CONCLUSIVE: It is not available in cases
where the statute provides for negligence per
se.
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CIVIL LAW
Damage v. Injury
INJURY is the illegal invasion of a legal
right;
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rights.
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The plaintiff voluntarily assumed the risk. Volenti non fit injuria.
DAMAGES
are
the
recompense
or
compensation awarded for the damage
suffered.
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CIVIL LAW
Prescription
- 4 years for Quasi-Delict (Art. 1146)
- 1 year for defamation (Art. 1147)
PERSONS LIABLE
Waiver
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Authority
&
Guardians
(mnemonic:
Authority
&
Company)
1. The ward if minor is below 21 years
old. If Incapacitated, the guardian is
liable for the acts of the ward
regardless of the latters age.
The child is under the parental
authority of the parents
2. The tortfeasor is under his authority
3. The tortfeasor is living in his company
Is a minor or insane tortfeasor with NO
parent or guardian liable?
Yes. He shall be answerable with his own
property in an action against him where a
guardian ad litem shall be appointed. (Art.
2182)
Owners and managers of establishments
or enterprises
Who
liable
are
Owners
and
managers of an
establishment
or enterprise
21
For
whose
acts
Their
employees
Requisites
for liability to
attach
The
damage
was caused in
the service of
the
branches
in which the
employees are
employed
-ORThe
damage
was caused on
the occasion of
their functions
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CIVIL LAW
REQUISITES OF LIABILITY:
Alternative Answer:
The insurance company is liable if Alberto was
negligent in the operation of the car and the
car was assigned to him for the benefit of the
insurance company, and even though he was
not within the scope of his assigned tasks
when the accident happened. In one case
decided by the Supreme Court, where an
executive of a pharmaceutical company was
given the use of a company car, and after
office hours, the executive made personal use
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gives
its
Suggested Answer:
The insurance company is not liable because
when the accident occurred, Alberto was not
acting within the assigned tasks of his
employment.
It is true that under Art. 2180 (par. 5) of the
Civil Code, employers are liable for damages
caused by their employees who were acting
within the scope of their assigned tasks.
However, the mere fact that Alberto was using
a service vehicle of the employer at the time
of the injurious accident does not necessarily
mean that he was operating the vehicle within
the scope of his employment. In Castilex
Industrial Corp. vs. Vasquez, Jr. (321 SCRA
393 [1999]), the Supreme Court held that
notwithstanding the fact that the employee
did some overtime work for the company, the
former was, nevertheless, engaged in his own
affairs or carrying out a personal purpose
when he went to a restaurant at 2:00 a.m.
after coming out from work. The time of the
accident (also 2:00 a.m.) was outside normal
working hours.
state
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CIVIL LAW
WHO,
AT
THE
TIME
OF
ITS
Custody
means
the
protective
and
supervisory custody the school and its head
and teachers exercise over the students for as
long as they are at attendance in the school,
including break times (lunch or recess).
E. Do tortfeasors vicariously liable under
Art. 2180 have a defense?
parental
School
Administrators
Teachers
Individual/entity/institution engaged in
child care
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are
Teacher- incharge
(the one
designated
to exercise
supervision
over
students)
Head of
establishme
nt of arts
and trades
School
(generally
not held
liable)
For
Acts
CIVIL LAW
whose
pupils
students
and
Apprentices
a.
b.
c.
if
the
tortfeasor
is
a
student of
the school
(Art 218
FC)
if
the
tortfeasor
is
a
teacher/
employee
of
the
school, it is
liable
as
employer
under 2180
(5) of CC
(St. Francis
vs. CA)
if
the
tortfeasor
is
a
stranger, it
is liable for
breach of
contract.
(PSBA vs.
CA)
Requisite for
Liability
to
Attach
pupils
and
students
remain
in
teachers
custody
regardless of
the age
custody
regardless
the age
must
below 18
of
be
Illustrations:
A. Abuse of Rights
Every person must, in the exercise of his
rights and in the performance of his duties,
act with justice, give everyone his due, and
observe honesty and good faith. (Art. 19)
Every person who, contrary to law, wilfully or
negligently causes damage to another, shall
indemnify the latter for the same. (Art. 20)
Art 19 contains a mere declaration of
principles. The declaration is implemented by
Art. 20. (Globe Mackay vs. CA)
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b. Disconnection of Utilities
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 vs. CA)
c. Malicious Prosecution
RULE: One cannot be held liable in damages
for maliciously instituting a prosecution where
he acted with probable cause. Reason: It
would be a very great discouragement to
public justice if prosecutors, who had a
tolerable ground of suspicion, were liable to
be sued at law when their indictments
miscarried. (Que vs. IAC)
EXCEPTION: 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 herein. The gist of the action
is the putting of legal process in force,
regularly, for the mere purpose of vexation or
injury.
Requisites for Malicious Prosecution:
(1)
(2)
(3)
(4)
(5)
Act is
Manner
Sanction
Indemnify
or
Contrary
to
morals,
good
customs, public
policy
Willfully
Injury or loss
Compensate
A. Unjust Enrichment
Art. 22. (CC) 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. 23.(CC) Even when an act or event
causing damage to another's property was not
due to the fault or negligence of the
defendant, the latter shall be liable for
indemnity if through the act or event he was
benefited.
Art. 2154.(CC) If something is received
when there is no right to demand it, and it
was unduly delivered through mistake, the
obligation to return it arises.
REQUISITES:
1) defendant is enriched
2) plaintiff suffered damage or loss
3) there is no just or legal ground for
defendant's enrichment
4) enrichment is at the expense of
plaintiff
e. Unjustified Dismissal
Quisaba vs. Sta. Ines
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Result
Willfully
negligently
Damage
Article 21
d. Public Humiliation
Article 19
(as
implemented
by Art. 20)
Contrary to law
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CIVIL LAW
C. Dereliction of Duty
Any person suffering material or moral loss
because a public servant or employee refuses
or neglects, without just cause, to perform his
official duty may file an action for damages
and other relief against he latter, without
prejudice to any disciplinary administrative
action that may be taken. (Art. 27)
(1)
(2)
(3)
(4)
Note
(Sangco):
REFUSAL
implies
a
deliberate act which may be due to erroneous
belief in good faith or plain ignorance; while
NEGLECT which is the failure to do a thing,
may
be
intentional
or
unintentional.
Furthermore, the duty to act must be
MINISTERIAL, and must be owed only to the
person who sustains the loss by the failure to
fulfill it.
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Suggested Answer:
(a) No. Mechanical defects of a motor vehicle
do not constitute fortuitous event, since
the presence of such defects would have
been
readily detected by
diligence
maintenance check.
The failure to
maintain the vehicle in safe running
condition constitutes negligence.
(b) The doctrine of vicarious liability is that
which renders a person liable for the
negligence of others for whose acts or
omission the law makes him responsible
on the theory that they are under his
control and supervision.
(c) In motor vehicle mishaps, the owner is
made solidarily liable with his driver if he
(the owner) was in the vehicle and could
have, by the use of due diligence,
prevented the mishap (Caedo vs. Yu Khe
Thai, 26 SCRA 410 [1968]). However, this
question has no factual basis in the
problem given, in view of the express
given fact that Orlando was not in the car
at the time of the incident.
C. Product Liability
Who is liable for death or injuries caused
by any noxious or harmful substances
used?
MANUFACTURERS
and
PROCESSORS
of
foodstuffs, drinks, toilet articles and similar
goods
shall
be
liable
ALTHOUGH
no
contractual relation exists between them and
the consumers. (Art. 2187)
D. Defective condition of public works
Who are liable for damages caused by
defective condition of public works?
LGUs (provinces, cities and municipalities)
shall be liable for damages for the death of, or
injuries suffered by, any person by reason of
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CIVIL LAW
be
responsible
for
Person
Strictly
Liable
For What
Manufacturers
and
Processors of
foodstuffs,
drinks, toilet
articles
and
similar goods
(FDTAS)
Defendant in
possession of
dangerous
weapons/
substances
such
as
firearms and
poison
Provinces,
Cities
and
Municipalities
death
and
injuries caused
by any noxious
or
harmful
substances used
Proprietor
building/
structure
For What
Possessor of
an animal or
whoever
makes use of
them even if
the animal is
lost
or
escaped
Owner
of
Motor Vehicle
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Motor
vehicle
mishaps
Defenses
or
Exception
s
Force
majeure
Fault of the
person who
suffered
damage
Solidary
liability
only if the
owner was
in
the
vehicle and
if he could
have
prevented
it thru due
diligence
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of
Defenses
or
Exception
s
If not in
vehicle
2180
Absence on
contractual
relation
NOT
a
defense
death or injury
results
from
such possession
possession
or
use
thereof
is
indispensab
le in his
occupation
or business
the death or
injuries suffered
by any person
by reason of the
defective
condition
of
roads, streets,
bridges, public
buildings,
and
other
public
works
total
or
partial
collapse
of
building
or
structure
if
due to lack of
necessary rep
airs
explosion of
machinery
which has not
been
taken
cared of with
due diligence,
and
the
inflammation
of
explosive
substances
which
have
not been kept
in a safe and
adequate
place
by excessive
smoke, which
may
be
harmful
to
persons
or
property
by falling of
trees situated
at
or
near
Public
works must
be
under
their
supervision
s
Responsibili
ty
for
collapse
should be
due to the
lack
of
necessary
repairs
CIVIL LAW
For What
Defenses
or
Exception
s
highways
or
lanes, if not
caused
by
force majeure
by
emanations
from
tubes,
canals,
sewers
or
deposits
of
infectious
matter,
constructed
without
precautions
suitable to the
place
Engineer,
Architect
or
Contractor
Head of the
Family
that
lives
in
a
building
or
any
part
thereof
if damage of
building
or
structure
is
caused
by
defect
in
construction
which happens
within 15 years
from
construction;
action must be
brought within
10 years from
collapse
liable
for
damages
caused
by
things
thrown
or falling from
the same
INDEPENDENT
1. Freedom of religion
2. Freedom of speech
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(2) defamatory,
(3)concerning the plaintiff.
2. Fraud
Under article 33 of the Civil Code, a civil
action for damages, entirely separate and
distinct from the criminal action may be
brought by the injured party in cases of
defamation, fraud and physical injuries, Estafa
falls under fraud. (Prudential Bank vs. IAC)
3. Physical Injuries
The term physical injuries is used in a
generic sense. It is not the crime of physical
injuries defined in the RPC. It includes not
only physical injuries, but consummated,
frustrated and attempted homicide. The ruling
in Corpus vs. Paje, which states that reckless
imprudence or criminal negligence is not
included in Art. 33 is not authoritative.
(Madeja vs. Hon. Caro)
C. Neglect of Duty
34 CC. When a member of the city or
municipal police force refuses or fails to
render aid or protection to any person in case
of danger to life or property, such peace
officer shall be primarily liable for damages
and the city or municipality shall be
subsidiarily responsible therefore. The civil
action herein recognized shall be independent
of
any
criminal
proceedings,
and
a
preponderance of evidence shall suffice to
support such action.
D.
Action
for
damages
where
independent civil action is provided
no
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CIVIL LAW
ARISING
(a)
Restitution;
Reparation of the damage caused;
and
Indemnification for consequential
damages.
Deemed
instituted
in
every
criminal
prosecution is the civil liability arising from the
crime or delict per se (civil liability ex delicto),
but not those liabilities from quasi-delicts,
contracts or quasi-contracts. (Neplum vs.
Orbeso)
An accused in a pending criminal case can
validly file, simultaneously and independently,
a separate civil action for quasi-delict against
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No proof of pecuniary loss is necessary for:
moral, nominal, temperate, liquidated or
exemplary damages.
DAMAGES
I. DEFINITION AND CONCEPT
CC
Art.
2200
2205
2206
2209
2208
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Art.
220
2
Contra
cts and
quasi
contrac
ts
Crimes
and
quasidelicts
Liability
extends
to
those:
1. natural and
probable
consequences
of the breach
2. those that
have
been
foreseen
3. those that
could
have
been
reasonably
foreseen
Provided:
obligor in good
faith
Liability
extends to all
damages
which are the
natural
and
probable
consequence
Note:
Liability
extends to
all damages
which may
be
reasonably
attributed to
the
nonperformance
of
the
obligation in
case
of
fraud,
bad
faith, malice
or
wanton
attitude
(FBM-WA).
Note:
WON
damage
is
foreseen is
irrelevant
Fact of
Injury
Cause
Amount
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Proof
Reasonable certainty only that the
fact and cause of injury must be
taken out of the area of speculation.
Usual burden of proof required in a
negligence
case,
prove
the
substantive right, its breach and the
amount of damages flowing from
the breach.
Proximate cause the cause,
which, in a natural and continuous
sequence, unbroken by any efficient
intervening cause, produces the
injury, and without which the injury
would not have occurred. (without
which test of cause in fact)
Need not be proved with the same
degree of certainty. Fair and
reasonable estimate of the amount
of damage.
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CIVIL LAW
1. Earning Capacity
2. Obligation to Support
3. Moral Damages to heirs
ATTORNEYS FEES
Attorneys Fees is the exception NOT the
general rule.
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Interest
due
Art.
2210
From
Breach of
contract
Discretion
of
the
court
Art.
2211
Crimes
and
quasidelicts
Discretion
of
the
court
Interest
imposed
on
damages
awarded
Interest
is
awarded
as part of
damages
BASE
c. When an
obligation,
NOT
constituting a
loan
or
forbearance
of money, is
breached, an
interest
on
the AMOUNT
OF DAMAGES
awarded may
be imposed
at
the
discretion of
the court.
RATE
at the rate
of 6% per
annum.
The
actual
base for the
computation
of
legal
interest shall
be on the
amount
finally
adjudged.
RATE
a)
That
which may
have been
stipulated
in writing.
b) In the
absence of
stipulation,
the rate of
interest
shall
be
12%
per
annum
(legal
interest)
ACCRUAL
to be computed
from
default,
i.e.,
from
JUDICIAL
or
EXTRAJUDICIAL
demand
under
and subject to
the provisions of
Article 1169 of
the Civil Code.
b.
Furthermore,
the
INTEREST
DUE
shall
itself earn
legal
interest
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c. When the
JUDGMENT
of the court
awarding
a
sum
of
money
becomes
final
and
executory,
the rate of
legal
interest,
whether
the
case
falls under
a,b, or c,
above,
shall
be
12%
per
annum
ACCRUAL
If claim or
damages are
LIQUIDATED,
from default,
i.e., from
judicial or
extrajudicial
demand. (Art.
1169, Civil
Code)
If
UNLIQUIDATED,
from the time
the demand can
be
established
with reasonable
certainty.
Hence,
the
interest
shall
begin
to
run
only FROM THE
DATE
THE
JUDGMENT
OF
THE COURT IS
MADE (at which
time
the
quantification of
damages
may
be deemed to
have
been
reasonably
ascertained).
from
such
FINALITY UNTIL
ITS
SATISFACTION,
this
interim
period
being
deemed to be by
then
an
equivalent to a
forbearance
of
credit.
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1. In
quasi-delicts
contributory
negligence (Art. 2214)
2. Doctrine of avoidable consequences
a) This refers to the duty to
minimize damages once a cause
of
action
has
accrued.
Standard: good father of a
family (Art. 2203)
3. In contracts, quasi-contracts and
quasi-delict (C-BELL):
a) plaintiff has contravened the
terms of contract
b) plaintiff derived some benefit as
result of contract
c) in
case
where
exemplary
damages are to be awarded,
that the defendant acted upon
the advise of counsel
d) that the loss would have
resulted in any event
e) that since the filing of the
action, the defendant has done
his best to lessen the plaintiff's
loss or injury (Art. 2215)
4. In crimes mitigating circumstances
(Art. 2204)
Note: aggravating circumstances in case of
crimes can increase the damages adjudicated
(Art. 2204)
The inordinate amount of damages calls for
the moderating hand of the court, that justice
may be tempered with reason instead of being
tainted when it appears to be a result of
ruthless vindictiveness.
B. Moral
What is the nature of moral damages?
Moral damages are emphatically not intended
to enrich a complainant at the expense of the
defendant. Its award is aimed at the
restoration, within the limits of the possible,
of the spiritual status quo ante, and it must be
proportional
to
the
suffering
inflicted.
(Visayan Sawmill vs. CA)
When are moral damages awarded?
- If injury consists of any of the ff:
(PBMF-MWSSS)
a.
b.
c.
d.
e.
f.
g.
h.
i.
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Physical suffering
Besmirched reputation
Mental anguish
Fright
Moral shock
Wounded feelings
Social humiliation
Serious anxiety
Similar injury
UP
Though
incapable
of
pecuniary
computation
If such is the proximate result of
defendants act or omission. (Art.
2217)
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21, 26, 27, 28, 29, 30, 32, 34, and 35.
Who else can recover moral damages?
-
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D. Temperate
What is the nature
moderate damages?
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or
temperate
of
Pleno vs. CA
Temperate damages are included within the
context of compensatory damages (RCPI vs.
CA). ". . . There are cases where from the
nature of the case, definite proof of pecuniary
loss cannot be offered, although the court is
convinced that there has been such loss. For
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E. Liquidated
What are liquidated damages?
Those agreed upon by the parties to a
contract, to be paid in case of breach thereof.
(Art. 2226)
What are the grounds for equitable
reduction of liquidated damages?
- iniquitous or
- unconscionable. (Art. 2227)
In what instance is the stipulation not
controlling?
When the breach of the contract is not the
one contemplated by the parties in agreeing
upon the liquidated damages. In this case, the
law shall determine
the measure of damages.
EXEMPLARY
OR
(Art. 2228)
CORRECTIVE DAMAGES
Crimes
Art.
2231
Quasi-delicts
Art.
2232
Contracts and
Quasicontracts
When exemplary
damages
are
granted
the
crime
was
committed with an
aggravating
circumstance/s
defendant
acted
with
gross
negligence
defendant acted in a
wanton, fraudulent,
reckless,
oppressive,
or
malevolent manner
(WFROMM)
Notes
(1) These damages are agreed upon in a
contract in case of breach thereof.
(2) There is no need to prove the amount,
only the fact of the breach.
(3) The amount can be reduced if:
a. unconscionable as determined by
the court (Art. 2227)
b. partial or irregular performance
General Rule: The penalty shall substitute
the indemnity for damages and the payment
of the interests in case or breach.
Exceptions
(1) When there is stipulation to the
contrary.
(2) When the obligor is sued for refusal to
pay the agreed penalty.
(3) When the obligor is guilty of fraud.
Notes
(1) Amount need not be proven.
(2) Cannot be recovered as a matter or right;
may be waived.
An employer may be subsidiarily liable to pay
moral, actual, temperate or liquidated
damages arising from an employees criminal
offense, but NOT as to exemplary damages
because
aggravating
circumstances
are
personal to the accused.
PNB vs. CA
However, the award of P1,000,000 exemplary
damages is also far too excessive and should
likewise be reduced to an equitable level.
Exemplary damages are imposed not to enrich
one party or impoverish another but to serve
as a deterrent against or as a negative
incentive to curb socially deleterious actions.
F. Exemplary or Corrective
Art. 2229. Nature of exemplary or
corrective damages
- Imposed by way of example
- or correction for the public good
- in addition to the moral, temperate,
liquidated or compensatory damages.
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Introduction
Torrens Certificate of Title
Original Registration
Cadastral Registration Proceedings
Subsequent Registration
Dealings with Unregistered Lands
Patents
Remedies of Aggrieved Party
Replacement and Reconstitution
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299
300
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CIVIL LAW
I. INTRODUCTION
D. JURISDICTION
RTCs of province or city where the
land or a portion or it lies- land
registration proceedings and over all
petitions filed after original registration
of titles (Sec. 2, PD 1529)
MTCs- cadastral and land registration
cases covering:
o lots without controversy or
opposition
o contested lots where the value
does not exceed P100,000.00
(sec. 34, BP 129)
2. LAND TITLE
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 property.
3. DEED
A written instrument executed in
accordance with law, wherein a person
grants or conveys to another certain
land, tenements, or hereditaments.
4. FEE SIMPLE
Absolute title; absolute estate in
perpetuity. Land is conferred upon a
man and his heirs absolutely and
without any limitation imposed upon
the state.
5. REGISTRATION
The State provides a public record of
the title itself upon which a
prospective purchaser or someone
else interested may rely.
6. RECORDING
Provides
for
the
recording
of
conveyance and other instrument
without guaranteeing the title, leaving
to the prospective purchasers or other
persons interested to examine the
instruments in the records and
formulate their own conclusions as to
their effect on the title.
B. NATURE
Land registration is a proceeding in rem
(Sec. 2, PD 1529). A proceeding in rem,
dealing with a tangible res, may be
instituted and carried to judgment, without
personal service Roxas vs. Enriquez.
C. PURPOSE OF REGISTRATION
The real purpose of that system is to
quiet title to land; to put a stop forever
to any questions of the legality of the
title, except claims which were noted at
the time of the registration, in the
certificate,
or
which
may
arise
subsequent thereto Legarda vs. Saleeby.
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A. KINDS
1. OCT
The first title issued in the name of a
registered owner by the Register of
Deeds covering a parcel of land
which had been registered under the
Torrens System, by virtue of judicial
or administrative proceedings.
2. TCT
The certificate shall show the number
of the next previous certificate
covering the same land and also the
fact that it was originally registered,
giving the record number, the
number of the original certificate of
title, and the volume and page of the
registration book in which the latter
is found. (Sec. 43, PD 1529)
3. PATENTS
Whenever public land is by the
Government alienated, granted or
conveyed to any person, the same
shall be brought forthwith under the
operation of this Decree. It shall be
the duty of the official issuing the
instrument of alienation, grant,
patent or conveyance in behalf of the
Government
to
cause
such
instrument to be filed with the
Register of Deeds of the province or
city where the land lies, and to be
there registered like other deeds and
conveyance.
The
deed,
grant,
patent
or
instrument of conveyance from the
Government to the grantee shall not
take effect as a conveyance or bind
the land but shall operate only as a
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CIVIL LAW
B. EFFECT OF REGISTRATION
Registration does not vest or give title
to the land, but merely confirms and
thereafter protects the title already
possessed by the owner, making it
imprescriptible by occupation of third
parties. it does not give the owner any
better title than he has.
Registration is not a mode of acquiring
ownership. A certificate of title cannot
be used to protect a usurper from the
true owner or as a shield for the
commission of fraud (Vagalidad vs.
Vagalidad, GR No. 161136.
C. ORIGINAL REGISTRATION PROCEEDINGS
Steps
in
Original
Registration
Proceedings
1) Determine if the land is registrable
2) Determine if you are qualified to apply
3) Survey the land
4) File the application (survey attached)
for land registration with the
appropriate court
5) Court sets initial hearing
6) Publication of the initial hearing
7) File an opposition to the application
8) Hearing
9) Judgment
10)Issuance of decree
1. WHAT ARE THE REGISTRABLE
LANDS?
PRIVATE LANDS
If in the public domain, the land
must be classified as alienable and
disposable. It must be classified as
such AT THE TIME OF FILING THE
APPLICATION FOR REGISTRATION.
(Republic vs. CA and Naguit, GR
No. 144057)
With the exception of agricultural
lands, all other natural resources
shall not be alienated. (sec. 2 and
3 Art. XII of the Constitution)
3. RA No. 8371
The Indigenous Peoples Rights Act
(Oct. 29, 1997) recognize the rights
of ownership and possession of
indigenous cultural communities to
their ancestral domains and lands on
the basis of native title, and defines
the extent of these lands and
domains.
It expressly converts
ancestral
lands
into
public
agricultural lands, and individuals
members
of
the
cultural
communicates shall have the option
to secure title to their ancestral lands
under the CA 141 or PD 1529.
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3. SURVEY
The survey may be done by a public
or private surveyor. When done by a
private surveyor it has to be approved
by the Land Management Bureau. PD
239 withdrew the authority of the
Land
Registration
Authority
to
approve original survey plans.
4. APPLICATION
The application for land registration
shall be:
in writing and
signed and sworn to by the
applicant or the person duly
authorized in his behalf
4) Those
who
have
acquired
ownership of land in any other
manner provided for by law.
If co-owned,
jointly.
file
the
application
It shall contain:
description of the land
citizenship and civil status of the
applicant
o
Exceptions:
(a) Aliens by way of hereditary
succession
(b) Natural born citizens who
have lost their citizenshiplimited to 5,000 sqm for
urban land and 3 hectares
for rural land (RA No. 7042
as amended by RA No.
8179)
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Secretary
of
Agrarian
Reform,
the
Solicitor
General, the Director of
Lands, the Director of Mines
and/or
the
Director
of
Fisheries
and
Aquatic
Resources, (as appropriate)
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
or the proceedings that a
tenant-farmer
or
the
national government may
have a claim adverse to that
of the applicant
(c) By Posting
(a) By Publication
The Commissioner of Land
Registration shall cause it to be
published:
once in the Official Gazette
(sufficient to confer
jurisdiction) and
once in a newspaper of
general circulation in the
Philippines
7. OPPOSITION
Any person claiming an interest 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.
(b) By Mailing
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8. HEARING
Proof of Ownership
(a) Tax declaration and receiptsnot conclusive but have strong
probative
value
when
accompanied by proof of actual
possession
Municipality
of
Santiago vs. CA
no
longer
9. JUDGMENT
Judgment
becomes
final
upon
expiration of 30 days from receipt of
notice of judgment (Sec. 30, PD
1529).
Other incidents:
WRIT OF POSSESSION
The writ may be issued not only
against the person defeated in
the registration case but also
against
any
one
adversely
occupying the land during the
proceedings Vencilao vs. Vano.
The writ does not lie against a
person who entered the land after
the issuance of the decree and
who was not a party in the case.
He can only be proceeded against
in a separate action for ejectment
or reinvindicatory action Bernas
vs. Nuevo.
WRIT OF DEMOLITION
This writ is a complement of the
writ of possession Gawaran vs. IAC.
2. Indefeasible
Ground
for
reopening
reviewing
the
decree
registration: Actual fraud.
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1) PERIOD OF FILING
3. Imprescriptible
2) REQUISITES
No title to registered land shall be
acquired by prescription or adverse
possession. (Sec. 47, PD 1529)
Filipino citizen
He must have, by himself, or
thru
his
predecessors-ininterest,
possessed
and
occupied an alienable and
disposable agricultural portion
of the public domain
Such possession and occupation
must have been OCEN and in
the concept of owner since June
12, 1945
Application filed with proper court
3) PRIVATE CORPORATIONS
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Presentation of
the owners
duplicate
certificate of title
is required to
notify; mere entry
insufficient
An innocent
purchaser for
value of
registered land
becomes the
registered owner
the moment he
presents and files
a duly notarized
and valid deed of
sale and the same
is entered in the
day book and at
the same time he
surrenders or
presents the
V. SUBSEQUENT REGISTRATION
A. TWO TYPES OF DEALINGS
1. VOLUNTARY DEALINGS
Deeds,
instruments,
documents
which are the results of free and
voluntary acts of parties thereto.
2. INVOLUNTARY DEALINGS
Writ, order, or process issued by the
court of record affecting registered
land, also other instruments which
are not willful acts of the registered
owner,
executed
without
his
knowledge or consent.
B. NECESSITY/EFFECTS OF
REGISTRATION
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INVOLUNTARY
DEALINGS
Attachment,
injunction,
mandamus, levy
on execution,
notice of lis
pendens
Entry in the day
book is sufficient
notice to all
persons
Entry thereof in
the day book of
the ROD is
sufficient notice
to all persons
even if the
owners duplicate
certificate of title
is not presented
to the ROD.
(Lenin vs. Bass,
1952)
CIVIL LAW
2.
3.
4.
5.
6.
7.
D. REGISTRATION OF VOLUNTARY
INSTRUMENTS
SECTION 57
a. An owner shall execute and
register a deed of conveyance
in a form sufficient in law.
b. The Register of Deeds shall
thereafter make out in the
registration
book
a
new
certificate of title to the grantee
and shall prepare and deliver to
him
an
owner's
duplicate
certificate.
c. The Register of Deeds shall note
upon the original and duplicate
certificate the date of transfer,
the volume and page of the
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CIVIL LAW
No
instrument
which
transfers,
mortgages or in any way deals with
registered land in trust shall be
registered, unless the enabling power
thereto is expressly conferred in the
trust instrument, or unless a final
judgment or order of a court of
competent jurisdiction has construed
the instrument in favor of the power, in
which case a certified copy of such
judgment or order may be registered
(Sec. 66, PD 1529).
Whoever
claims
an
interest
in
registered land by reason of any
implied or constructive trust shall file
for registration with the Register of
Deeds a sworn statement. Such claim
shall not affect the title of a purchaser
for value and in good faith before its
registration (Sec. 68, PD 1529).
3. SUBSISTING ENCUMBRANCES/
ANNOTATIONS
Encumbrances or annotations that
appear in the registration book shall
be carried over in the new certificate
or certificates; except so far as they
may be simultaneously released or
discharged. (Sec. 59, PD 1529)
H. INVOLUNTARY DEALINGS
1. ATTACHMENT
An attachment, or a copy of any
writ, order or process issued by a
court of record, intended to create
or 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.
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appeal the matter to the Commissioner of
Land Registration. Any recording made
under this section shall be without
prejudice to a third party with a better
right.
4. ADVERSE CLAIM
WHEN IS A CLAIM ADVERSE?
When a person claims any part or
interest in registered land adverse to
the
registered
owner,
arising
subsequent to the date of the original
registration. (Sec. 70, PD 1529)
The adverse claim shall be effective
for a period of 30 days from the date
of registration. After that the
annotation of adverse claim may be
cancelled upon filing of a verified
petition therefor by the party in
interest. After cancellation, no second
adverse claim based on the same
ground shall be registered by the
same claimant (Sec. 70, PD 1529).
VII. Patents
Requisites:
1. The adverse claimant must
state the ff in writing:
- his alleged right or interest
- how and under whom such
alleged right or interest is
acquired
- the description of the land
in which the right or
interest is claimed and
- the number of the
certificate of title
2. The statement must be signed and
sworn to before a notary public or
other officer authorized to
administer oath and
3. The claimant should state his
residence or the place to which all
notices may be served upon him.
Non-compliance with the above
requisites renders the adverse
claim
non
registrable
and
ineffective.
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Applicant
The Public
Land Act
provides
that any
Filipino
citizen over
the age of
18 or head
of the family
may enter a
homestead
Requirements
- Max of 12
hectares of
agricultura
l land
- Applicant
must have
cultivated
and
improved
at least
1/5 of the
land
continuous
ly since
the
approval of
the
application
resided for
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Sales
Patent
Public
Agricult
ural
Lands
Any Filipino
of lawful age
or the head
of a family
may
purchase
any tract of
public
agricultural
land not to
exceed 12
hectares.
Lands
for
residen
tial,
comme
rcial or
industri
al
purpos
es
Lands
for
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-Filipino
citizen of
legal age
- not the
owner of a
home lot in
the mun
where he
at least 1
yr in the
municipalit
y in which
the land is
located or
in an
adjacent to
the same
Payment
of fee
required
Sold thru
sealed
bidding
Purchase
price may
be paid in
full upon
the making
of the
award or
in not
more that
10
installment
s from the
date of the
award
Purchaser
shall have
not less
than 1/5 of
the land
cultivated
w/in 5 yrs
from the
date of the
award
Before any
patent is
issued he
must show
actual
occupancy,
cultivation
and
improveme
nt of at
least 1/5
of the land
until the
date of
final
payment.
residen
tial
purpos
es
BAROPS
lands and
other lands
may be
sold on
condition
that the
purchaser
shall make
improveme
nts of a
permanent
character
for the
purpose
for which
the land is
purchased
w/in 18
moms.
From the
date of the
award.
exception
to CA 141
- area does
not exceed
1,000 sqm
- it shall be
an
essential
condition
of this sale
that the
occupants
has
constructe
d his
house on
the land
and
occupants
has
constructe
d his
house on
the land
and
actually
resided
therein
-does not own
more than 12
hectares of
land
- continuously
occupied and
cultivated,
either by
himself or his
predecessorsin-interest,
tracts of
agricultural
public lands
subject to
-
Free
patent
Lands
reclaimed
by the
govt and
foreshore
shall be
disposed
by lease
only
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reisides
- have
established
in good faith
his residence
on a parcel
of public
land which is
not needed
for public
service (RA
730)
2008
To any
natural born
Filipino
citizen
(filing ended
Dec. 31,
2000)
Special
patent
CIVIL LAW
disposition for
at least 30
years prior to
March
28,1990
- paid real
property taxes
on the
property while
the same has
not been
occupied by
any person
Issued upon
the
promulgation
of a special
law or act of
Congress or
by the Sec of
DENR as
authorized by
an EO
for
Review
Grounds:
- extrinsic fraud,
- void decision for want
of due process
- lack of jurisdiction
e.g. issued by
the Pres. In
1988 to the
Public Estates
Authority
under PD
1085 over 3
reclaimed
islands in the
name of PEA
Action
for
Reconv
eyance
Appeal
Relief
from
Judgm
ent
Petition
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Crimin
al
Action
39
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Indefeasibility of title,
prescription, laches, and
estoppel do not bar reversion
suits.
Perjury, Forgery, Others
involving fraud
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1.
2.
3.
4.
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Conflict of Laws
Jurisdiction
Choice of Law
Recognition and Enforcement of Judgment
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315
317
324
CIVIL LAW
CONFLICT OF LAWS
PRIVATE INTERNATIONAL LAW : that part
of municipal law which governs cases
involving a foreign element
o
Basis
Parties
PRIL
Individuals or
corporations
JURISDICTION
JURISDICTION40 : the power of a court to
TRY a case, RENDER judgment, and EXECUTE
it in accordance with law
ASPECTS OF JURISDICTION:
1. Jurisdiction over the parties
2. Jurisdiction over the property (res)
3. Jurisdiction over the subject-matter
PIL
Primarily
states and
international
organizations
treaty
custom
generally
- National
recognized
conflict
principles
rules
of law
Sources
- judicial
decisions
International
- teachings
conflict
of the most
rules
highly
qualified
publicists
- diplomatic
protest
- negotiation, - resort to
conciliation,
forum
arbitration
court or
Remedies - adjudicatio
administrat
n before
ive
internation
tribunals
al tribunal
- use of force
- war
PRIL v. Municipal law: presence of foreign
element
SOURCES
1. Codes and statutes
2. Treaties and international conventions
3. Treatises, commentaries, and studies
of learned societies
4. Judicial decisions
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2. Choice of law
- Which law will the court apply?
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International
Shoe
Co.
v.
Washington (1945): Due process only
requires that the defendant who is not
present within the territory of the
forum have minimum contacts with it
such that the maintenance of the suit
does not offend traditional notions of
fair play and substantial justice.
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CIVIL LAW
CHOICE OF LAW
APPROACHES TO CHOICE OF LAW
1. Traditional approach: simplicity,
convenience, uniformity
2. Modern approach: reaching appropriate
results in particular cases
TRADITIONAL APPROACH THEORIES:
1. Vested Rights Theory
o An act done in a foreign jurisdiction
gives rise to the existence of a right if
the laws of that state provide so. This
right vests in the plaintiff and he
carries it with him to be enforced in
any forum he chooses to bring suit
o The applicable law is the law of the
place of occurrence of the LAST ACT
necessary to complete the cause of
action.
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Statue of Frauds
- substantive if it forbids the creation
of the obligation (void)
- procedural if it forbids the
enforcement of the obligation (no
action shall be brought)
Statue of Limitations
- traditionally considered procedural
- substantive if they provide for a
SHORTER PERIOD for certain types
of claims that fall within a wider
classification covered by a general
statute of limitations
Specificity test: substantive
when the limitation was
directed to the newly created
liability so SPECIFICALLY as to
warrant saying that it qualified
the right
- Borrowing statute: a statute which
bars the filing of a suit in the forum
if it is already barred by the SOL in
the place where the cause of action
arose
Dpecage (to dissect)
o Nuanced single-aspect method
o Cutting up the case issue by issue and
applying the pertinent laws to the
different aspects
RENVOI (send back)
o A procedure whereby the conflicts rule of
the forum refers the jural matter to a
foreign state and in turn, the conflicts rule
of such foreign state refers the matter
back to the law of
- the forum (REMISSION); OR
- a 3rd state (TRANSMISSION)
4 ways of dealing with renvoi:
1. REJECT renvoi and apply internal law of
the foreign state (that applied to a purely
domestic case)
2. ACCEPT renvoi and apply the whole law
of the foreign state (including its conflict
rules)
o Effect: forum law applied
3. DESISTANCE or mutual disclaimer of
jurisdiction
o Upon reference to another states law,
the court sees that such law is limited
to its own national and has no
provision for application to a nonnational
o Same effect as acceptance: forum law
applied
FOREIGN LAW
PLEADING AND PROOF
Gen. Rule: Foreign law must be pleaded and
proved as a fact
o The party whose cause of action or
defense depended on the foreign law
has the burden of proving the foreign
law.
Exception: Court may take judicial notice of
foreign laws which are already within its
ACTUAL KNOWLEDGE such as when:
- they are well and generally known OR
- they have been actually ruled upon in
other cases before it and none of the
parties concerned claim otherwise
(PCIB v. Escolin, 1974)
Foreign law proved by:
1. an OFFICIAL PUBLICATION of the law; OR
2. a COPY of the law ATTESTED by the officer
having the legal custody of the record, or
by his deputy.
- If such record is not kept in the
Philippines, it must be accompanied
with a certificate that such officer has
the custody
3 Alternatives in case of failure to plead and
prove foreign law
1. DISMISS the case for failure to establish a
cause of action
2. Apply FORUM LAW
3. PROCESSUAL PRESUMPTION
Factors in deciding whether to apply domestic
law or decide against the party who has the
burden of proving the contents of foreign law:
1. degree of PUBLIC INTEREST involved
2. ACCESSIBILITY of the foreign law
materials to the parties
3. probability that the plaintiff is merely
FORUM-SHOPPING
4. SIMILARITIES between the forum law
and foreign law
EXCEPTIONS TO THE APPLICATION
OF FOREIGN LAW
1. Local law expressly so provides
2. Failure to plead and prove the foreign
law or judgment
3. Exceptions to the rule of comity:
(4P-FAG-UV)
a. The foreign law is contrary to an
IMPORTANT PUBLIC POLICY of the
forum
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NATIONALITY
o Each state has the prerogative and
authority to determine by its own
municipal law who are its nationals or
citizens.
Statelessness
o De jure statelessness: person has been
stripped of his nationality by his former
govt. without having an opportunity to
acquire another
o De facto statelessness: person possessed
of a nationality but his country does not
give him protection outside its own
territory (refugee)
DOMICILE
PERSONAL LAW
o Ones personal law follows him
wherever he is and governs those
transactions which affect him most
closely.
o Determined either by ones nationality
or domicile
o Most civil law countries such as the
Philippines follow the national law
theory
Nationality
Merits
- logical since
lawmakers
considered the
qualities of its
citizens in
making the
laws
- easily
verifiable from
documents
Demerits
- does not
provide
solution with
respect to
stateless
persons
those with
multiple
nationalitie
s
states with
diverse
legal
systems
- persons ties to
his nation may
be so
attenuated if
he has lived in
another
country most
of his life
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Domicile
Merits
- genuine link
- suitable for
countries with
a federal
system
Demerits
- not easily
determinable
- concept not
clear-cut
- if domicile of
origin given
much weight,
connection
attenuated
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NOT lost by
mere
abandonment
and remains
until replaced
by a domicile
of choice
Presumed to
be revived
once the
domicile of
choice is given
up and before
a new one is
acquired
(reverter or
revival
doctrine)
2008
Domicile of
Choice
deemed
extinguished
by removal of
intent even
prior to the
acquisition of
a new
domicile
CIVIL LAW
Constructive Domicile
o Domicile assigned to persons legally
incapable of choosing their own
domicile:
- minors
- mentally disabled
- married women
FAMILY RELATIONS
1. Marriage
a. extrinsic validity: lex loci celebrationis
(Art.26, FC; Hague Convention)
b. intrinsic validity: personal law
- refers to capacity
c. effects of marriage: personal law
d. property relations of spouses
- Hague Convention:
- law designated before marriage
- in default, law of state of first
habitual residence
- Art 80, FC43: generally follows lex
situs
(3)
43
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CIVIL LAW
PROPERTY
CONTRACTS
1. Extrinsic validity: lex loci celebrationis
(Sec. 9, Restatement 2nd; Art.17,CC)
- principle of LOCUS REGIT ACTUM:
place governs the act
2. Intrinsic validity: 3 possible law:
a. Lex loci CONTRACTUS
b. Lex loci SOLUTIONIS
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CIVIL LAW
Factors to consider:
1. Place of contracting
2. Place of negotiating
3. Place of performance
4. Situs of the subject-matter of the
contract
5. Parties domicile, residence,
nationality, place of incorporation,
place of business
6. Place under whose local law the
contract will be most effective
Adhesion Contracts
o
o
o
SUCCESSION
1. Extrinsic validity of wills
(Arts.17, 815-817, CC)
Testator
Special Contracts
1. Sale or barter of goods: lex situs
2. Simple loan granted by financial
institutions: law of the permanent place of
business
3. Loan granted by a private individual or
where subject matter of loan is personal:
law of the place where the loan was
obtained
4. Pledge, Chattel Mortgage, Antichresis: lex
situs
5. Carriage of goods by sea:
- law of the place of destination
(Art.1753, CC)
Code of Commerce
- COGSA
6. International Air Transportation: Warsaw
Convention
Filipino
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Foreign
country
Philippines
Alien
Foreign
country
Place of
Execution
Philippines
Applicable
Law
Philippine law
1. Lex loci
celebrationi
s
2. Philippine
law
1. law of
nationality
2. Philippine
law
1. Law of
nationality;
2. Law of
domicile;
3. Lex loci
celebrationi
s;
4. Philippine
law
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2008
Place of
revocation
MODERN APPROACH
Applicable
law
Philippine law
Philippines
Philippine law
Philippine
domiciliary
Foreign
country
Nondomiciliary
CIVIL LAW
1. Philippine
law
2. lex loci
actus (law
of the place
of
revocation)
(Coquia &
Pangalanga
n)
1. lex loci
celebrationi
s
2. lex domicilii
at the time
of the
revocation.
5. Probate
o Law of the forum governs procedural
matter
o Compliance with extrinsic requirements
governed by Arts.17,815-817, CC)
6. Administration of estates
o Territorial: governed by the law of the
place where the administration takes
place, and that is the law of the
country from which the administrator
derives his authority.
7. Testamentary trusts
o Extrinsic validity: rules governing wills
apply
o Intrinsic validity: lex situs since a trust
involves property
TRADITIONAL APPROACH
1. lex loci delicti commissi applies in
matters concerning conduct and safety
2. lex domicilii of parties applies in
matters concerning loss distribution or
financial protection
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CIVIL LAW
CORPORATION OR PARTNERSHIP
PERSONAL LAW
General Rule:
incorporation
Law
of
the
place
of
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Exceptions:
1. isolated transactions
2. action to protect trademark, trade
name, goodwill, patent or for unfair
competition
3. agreements fully transacted outside
the Philippines
4. petition filed is merely corollary
defense in a suit against the
corporation
EFFECT OF FAILURE TO SECURE A LICENSE
TO TRANSACT BUISNESS
o The foreign corporation has no right to
sue in the Philippines but it can still be
sued.
o Although the contracts entered into
may be valid as between the parties, it
may not be enforced in the Philippine
courts.
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CIVIL LAW
recognition and enforcement of
Philippine judgments
5. Judgment is for a FIXED SUM of money
6. Foreign judgment not contrary to
PUBLIC POLICY or GOOD MORALS of
country where it is sought to be
enforced
7. Judgment not obtained by EXTRINSIC
FRAUD, COLLUSION, MISTAKE of fact
or law
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