Reviewer in CIvil Law

C i vi l L a w R e vi e w 2 0 2 2 ( P r o f .
R a b u ya ) D e L e o n |1
BOOK I. PERSONS AND FAMILY RELATIONS

GR: Laws are to be construed as having only prospective application.
I. PRELIMINARY TITLE  Lex prospicit, non respicit; the law looks forward, not backward.
 Ratio: retroacting a law’s application divests vested rights or
A. Effectivity and Application of Laws impairs obligations of contract.
1. Effectivity of Laws EXC:

1. The law provides for its retroactivity
ARTICLE 2, NCC. Laws shall take effect after fifteen days a. UNLESS (retroactive effect cannot be applied if): it will make
following the completion of their publication either in the Official XPN to XPN it an ex post facto law or will impair the obligation of
Gazette or in a newspaper of general circulation in the Philippines, contracts. =
unless it is otherwise provided. - Ex post facto law: penalizes an act which was not an
offense at the time of its commission
(a) When the law is silent as to its effectivity 2. When a penal law is favorable to the accused
 After 15 days following the completion of its publication either XPN to XPN a. UNLESS (retroactive effect cannot be applied if): the
in the Official Gazette, or in a newspaper of general circulation in accused is a habitual delinquent
the PH. 3. The law is remedial or procedural in nature
o Ex. Effectivity date is on the 16th, not 15th. a. No vested right may attach from procedural laws.
o Law was completely published on March 1. It becomes - There are procedural rules that have substantive rights.
effective on March 17. - Remedial laws ARE NOT ALWAYS RETROACTIVE.
4. The law is curative in character.
(b) When the law provides for its date of effectivity 5. The law creates new substantive rights, provided it has not
 Takes effect on the said date prejudiced another acquired right of the same origin.
o PROVIDED: the law is published.
 Publication of laws is indispensable  due process (Tanada v. EXC to the EXC: When it violates due process
Tuvera)  If it impairs vested rights
(c) When law provides that it shall take effect “immediately upon 4. Requisites for Valid Waiver of Rights
approval
 Effective immediately upon its publication. ARTICLE 6, NCC. Rights may be waived, unless the waiver is
 There is nothing in Article 2 NCC that prevents a law from taking contrary to law, public order, public policy, morals, or good customs,
effect on a date other than—or before—the 15-day period after its or prejudicial to a third person with a right recognized by law.
publication.
Waiver is the intentional relinquishment of a known right.
Underlying basis for Articles 2, 3, 4 – due process Requisites
(1) that the person making the waiver possesses the right,
2. Presumption of Knowledge of Laws (2) that he has the capacity and power to dispose of the right,
(3) that the waiver must be clear and unequivocal although it may be
ARTICLE 3, NCC. Ignorance of the law excuses no one from made expressly or impliedly, and
compliance therewith. (4) that the waiver is not contrary to law, public policy, public order,
morals, good customs or prejudicial to a third person with a right
(a) As to Domestic Laws recognized by law
 GR: Everyone is conclusively presumed to know the law.
o All laws of local and general application 5. Repeal of Laws
 EXC: Mistake upon a doubtful or difficult question of law may
be the basis of good faith and may come within the scope of solutio ARTICLE 7, NCC. Laws are repealed only by subsequent ones,
indebiti. and their violation or non-observance shall not be excused by disuse,
or custom or practice to the contrary.
(b) As to Foreign Laws
 There is no conclusive presumption of knowledge. When the courts declare a law to be inconsistent with the
o Foreign laws must be specifically alleged and proved. Constitution, the former shall be void and the latter shall govern.
 Doctrine of Processual Presumption or Doctrine of Presumed
Identity Administrative or executive acts, orders and regulations shall be valid
o Our courts will presume that the foreign law is the same as only when they are not contrary to the laws or the Constitution.
our local / domestic / internal law if the foreign law is not
properly pleaded and proved. Ways to Render a Law Ineffective
(1) Repeal of Laws – Congress
3. Rule on Operation and Application of Laws (2) Declaration of Unconstitutionality – Courts
ARTICLE 4, NCC. Laws shall have no retroactive effect, unless the Manner of Repeal
contrary is provided. (a) Express Repeal – contained in a special provision of a subsequent
law
(1) Must designate the particular or specific law to be repealed.
ARTICLE 5, NCC. Acts executed against the provisions of
(b) Implied Repeal – takes place when the provisions of the
mandatory or prohibitory laws shall be void, except when the law
subsequent law are incompatible with those of an earlier law and
itself authorizes their validity.
there is no express repeal.
C i vi l L a w R e vi e w 2 0 2 2 ( P r o f . R a b u ya ) D e L e o n |2
ARTICLE 13, NCC. When the laws speak of years, months, days or
Requisites nights, it shall be understood that years are of three hundred sixty-
 Laws cover the same subject matter five days each; months, of thirty days; days, of twenty-four
 The latter is repugnant to the earlier hours; and nights from sunset to sunrise.
o Total repugnancy
o Otherwise, if they can be reconciled, the courts will respect If months are designated by their name, they shall be computed by
those actions of Congress the number of days which they respectively have.
Effect of Repeal of Repealing Law In computing a period, the first day shall be excluded, and the last
 Express repeal – When a law which expressly repeals a prior law day included.
is itself repealed, the law first repealed shall not be revived
unless expressly provided. Year 12 calendar months (Admin Code)
 Implied Repeal – When a law which impliedly repeals a prior law 365 days (NCC)
is itself repealed, the prior law shall be revived, unless the Month GR: 30 days
repealing law provides otherwise. EXC: months are designated by their name; they shall be
computed by the number of days which they respectively
6. Effect of Judicial Decisions have
Day 24 hours
ARTICLE 8, NCC. Judicial decisions applying or interpreting the laws Night Sunset to sunrise
or the Constitution shall form part of the legal system of the
Philippines. (a) Two laws on counting of legal periods
(1) Article 13 NCC
(a) Part of the Legal System (2) Sec. 31, Chapter 8, Book I of the 1987 Administrative Code
 Only those enunciated by the SC (b) Implied repeal of Article 13 NCC in counting a year
o Ex. Pulido v. People – Article 40 FC (1) Under the Admin Code: a year is understood to be twelve
o Andal v. Andal – Article 36 FC calendar months.
o Article 36, p. 2 FC (c) How to Count 12 calendar months
 These decisions are now part of those provisions. (1) Calendar Month – a month designated in the calendar
without regard to the number days it may contain. (CIR v.
(b) Operation and Application Primetown Property Group)
 RULE: Retroactive Application (2) "period of time running from the beginning of a certain
o SC’s interpretation of a statute forms part of the law as of the numbered day up to, but not including, the corresponding
date it was originally passed. numbered day of the next month, and if there is not a sufficient
o SC’s construction merely establishes the contemporaneous number of days in the next month, then up to and including
legislative intent that the interpreted law carries into effect. the last day of that month." To illustrate, one calendar month
 Does not amount to the passage of a new law – only an from December 31, 2007 will be from January 1, 2008 to
interpretation January 31, 2008; one calendar month from January 31, 2008
o Technically, this isn’t retroactive because this has always will be from February 1, 2008 until February 29, 2008.
been the meaning of the law. It’s just that there was no (d) Rule in Counting Periods
controversy on the interpretation of the law. (1) The first day is EXCLUDED.
o The interpretation is considered as part of the law from the (2) The last day is INCLUDED.
day of enactment.
 EXC: prospective application Regardless of leap of regular year.
o When a doctrine of the SC is overruled and a different view
is adopted, the new doctrine should be applied B. Basic Conflict of Laws Rules
prospectively and should not apply to parties who had relied
on the old doctrine and acted on the faith thereof. 1. Application of PH Penal Laws
o The first interpretation retroacts to the first day. But the later
interpretation will apply prospectively. The new interpretation ARTICLE 14, NCC. Penal laws and those of public security and
is not considered part of the law from the day of enactment. safety shall be obligatory upon all who live or sojourn in
Philippine territory, subject to the principles of public international
Ex. Republic v. Manalo law and to treaty stipulations.
A Filipino citizen obtained a decree of absolute divorce abroad, releasing
the Filipino from her marriage to the foreigner spouse. In 2018, the SC RULE: PH Penal laws and those of public security and safety are
ruled that the provision on judicial recognition is applicable regardless of obligatory upon ALL WHO LIVE AND SOJOURN in PH territory (Article
who obtained the divorce. Can the Filipino apply this 2018 ruling and 14 NCC)
get judicial recognition of her divorce?  Principle of generality of Criminal Laws
(c) Doctrine of Stare Decisis EXC:

 Once a point of law has been established by the court, that point of  If treaty stipulations provide to the contrary
law will, generally, be followed by the same court and by all  A law of preferential application provides to the contrary
courts of lower rank in subsequent cases where the same legal  A principle of public international law provides to the contrary.
issue is raised. o EX. Heads of state are not subject to PH territorial jurisdiction
7. Computation of Legal Period 2. Nationality Principle

ARTICLE 15, NCC. Laws relating to family rights and duties, or to ARTICLE 16, NCC. Real property as well as personal property is
the status, condition and legal capacity of persons are binding subject to the law of the country where it is situated.
upon citizens of the Philippines, even though living abroad.
However, intestate and testamentary successions, both with respect
RULE: On the matter of status of persons, condition of persons, the legal to the order of succession and to the amount of successional rights
capacity of persons, and his family rights and duties, the applicable law and to the intrinsic validity of testamentary provisions, shall be
is the national law of the person concerned. (Article 15 NCC) regulated by the national law of the person whose succession is
under consideration, whatever may be the nature of the property and
(a) Rules on Validity of Absolute Divorces regardless of the country wherein said property may be found.
(1) A divorce obtained abroad by an alien may be recognized in
our jurisdiction RULE: If the issue involves the properties, whether real or personal,
(2) In a mixed marriage (alien and PH national), a decree of the applicable law is the law of the country where it is situated.
absolute divorce obtained is recognized as valid even insofar
as the PH national is concerned so long as the divorce EXC: National law of the decedent: It is the national law of the
decree is valid according to the national law of the foreign decedent which shall apply in intestate or testamentary succession
spouse and it capacitated the latter to remarry, regardless of with regard to:
who may have obtained the divorce decree (Republic v.  Order of succession OrAmInCap
Manalo)  Amount of successional rights
(3) An absolute divorce secured by a Filipino married to  Intrinsic validity of provisions of the will
another Filipino is contrary to our public policy and shall not  Capacity to succeed (Article 1039 NCC)
be recognized.
(4) In determining the nationalities of the parties, the reckoning A foreigner comes to the PH and fathers an illegitimate child. He creates
point is NOT the citizenship of the divorce parties at birth a will leaving everything to his legitimate son, which is allowed according
or at the time of marriage, BUT their citizenship at the time to his national law. He also obtained properties in the PH. The legitimate
a valid divorce is obtained abroad. child went to the PH for the probate of the will. The mother opposed the
probate, alleging that the illegitimate child was preterited. Will the case
(b) Legal Capacity prosper? ITC, there is no preterition because this is allowed under the
 GR: National law of the person concerned. (Nationality Principle) national law of the father.
 EXC: All matters concerning the title and disposition of real
property are determined by lex loci rei sitae, or the law of the Q. This was allowed at the TIME OF EXECUTION OF THE WILL. The
place where the property is situated. law at the time of death of the father, the law was changed to follow
o Also governs the capacity of the person making a deed PH law, which disallows preterition. Will the case prosper? Is the child
relating to immovable property preterited? YES. The governing law will be the law at the time of the
o Nationality principle doesn’t apply even if the issue is on decedent (Article 777 NCC). The rights to succession are transmitted
the legal capacity of the person if the case is on the at the time of death. Prior to death, there is no right so there is no
acquisition of property. impairment of rights if the law is changed. (See the aspects of
o Ex. We don’t allow foreigners to acquire land unless it’s succession)
through hereditary succession.
 If the issue is legal capacity, the applicable law is the law 4. Principle of Lex Loci Celebrationis
of the place where the property is situated (ITC: PH
Constitution) ARTICLE 17, NCC. The forms and solemnities of contracts, wills,
 With respect to sex, national law applies. and other public instruments shall be governed by the laws of the
o Ex. Johnwyn Formal (Thai) changes his sex in Thailand, country in which they are executed.
which allows sex reassignment. She becomes Janella.
Janella marries a Filipino male. When the acts referred to are executed before the diplomatic or
o In the PH, Formal is now female. (National Law). The consular officials of the Republic of the Philippines in a foreign
marriage is considered valid in the PH. country, the solemnities established by Philippine laws shall be
o Why are we applying Article 15 to foreigners when it only observed in their execution.
mentions PH citizens?
 By analogy Prohibitive laws concerning persons, their acts or property, and those
 Article 15 was intended to be a conflict of law rule. which have for their object public order, public policy and good
o Silverio v. Republic is applicable only to citizens of the PH customs shall not be rendered ineffective by laws or judgments
following the nationality principle. promulgated, or by determinations or conventions agreed upon in a
foreign country.
(c) Family Rights and Duties
 Governed by their national law  Forms and Solemnities of Wills (Extrinsic validity): governed by
 If a foreigner has a minor child in the PH with a Filipino citizen, the laws of the country in which they are executed (Article 815
his national law will not apply in the PH if the same provides NCC)
that parents have no obligation to support their children, or o EXC: joint wills executed by Filipinos in a foreign country shall
failure to fulfill such obligation is not punishable by law. not be valid, even if authorized by the laws of the country
o In conflict of Laws, the forum may refuse to apply the where it was executed
applicable foreign law if the same is contrary to a sound o ARTICLE 815. When a Filipino is in a foreign country, he is
and established public policy of the forum. authorized to make a will in any of the forms established by
the law of the country in which he may be. Such will may be
3. Principle of Lex Rei Sitae (or Lex Situs) probated in the Philippines.
o Q. Mark Joshua De Fiesta went to France where he executed between MALE and FEMALE. Same-sex marriage is considered
his will in the form of audio video (cell phone). This form of will contrary to public policy and morals.
is allowed in France. Can this be probated in the PH? YES. o A void marriage is registrable. Why can’t same-sex marriages
 After he recorded his will, France changed its laws such be registrable? In our law, that is not a marriage. There is no
that a will should be in writing (holographic or notarial). marriage to speak of. You don’t have to file any petition.
Can the will still be probated? YES. If the issue is the  Q. Citizens of California, US, went to the Philippines. They are a
formalities and solemnities of the will, we follow the same-sex couple. They entered a transaction where the consent of
law at the time of execution of the will, regardless of the spouses is required. Will they be considered married in the PH?
a change in the law. YES. Our public policy does not apply to foreign citizens.
 Forms and Solemnities of Contracts: governed by the laws of o Article 17, paragraph 3 applicable is only applicable to citizens
the country in which they are executed. of the PH.
o EXC: All matters concerning the title and disposition of real o We must respect the foreign policy of other countries under
property are determined by what is known as the lex loci rei the Principle of Comity.
sitae
 Intrinsic Validity of Contracts:
o Lex contractus: proper law of the contract – the law
voluntarily agreed upon by the parties (lex loci voluntatis)
or the law intended by them (lex loci intentionis), which
can be inferred.
o In the absence of such choice:
 Law of that State that has the most significant
relationship to the transaction and the parties
 Law of the place of performance or lex loci solutionis if
the issue relates to all matters relating to the time, place,
and manner of performance and valid excuses for non-
performance.
 Intrinsic Validity of Will: Law at the time of death (Article 777)
5. When Foreign Laws Cannot be Applied
ARTICLE 17, NCC. XXX
Prohibitive laws concerning persons, their acts or property, and

those which have for their object public order, public policy and
good customs shall not be rendered ineffective by laws or
judgments promulgated, or by determinations or conventions agreed
upon in a foreign country.
 Article 17 paragraph 3, NCC: Prohibitive laws concerning

persons, their acts or property, and those which have for their
object public order, public policy and good customs shall not be
rendered ineffective by laws or judgments promulgated, or by
determinations or conventions agreed upon in a foreign country.
 A foreign law, judgment, or contract contrary to a sound and
established public policy of the forum shall not be applied when
its application would work undeniable injustice to the citizens or
residents of the foreign.
 Q. A foreigner married a Filipino female. When their child was 2
years old, the foreigner obtained a decree of absolute divorce in his
country. The foreigner stopped supporting the child. The foreigner
contracted another marriage to another Filipino citizen. After 5
years, the first wife filed a criminal case against the foreigner for
violating RA 9262, alleging economic violence for failing to support
his minor child in the PH. The foreigner says that national law must
be applied. According to his national law, in case of divorce, the
obligation to support falls on the parent who has custody of the
child. Thus, he has no obligation to support this child.
o What should be the governing law? Under Article 15, the
national law of the father is applied.
 BUT is this a valid defense for criminal prosecution? NO.
If a foreign law is contrary to public policy, this cannot be
applied. (Art. 17, p. 3)
 Q. Ion and Vice are male Filipino citizens. They got married in
California where same-sex marriage is valid. Will the PH
acknowledge this marriage? NO. Under PH law, marriage is
II. HUMAN RELATIONS  What is the difference between Article 20 and 1170?
o Article 20: There is no contractual relationship between the
C. Required Norm of Human Conduct parties.
o GR: If there’s a contractual relationship, your cause of action
1. Norm of Human Conduct is based on the violation of contract (1170).
(a) Basic Principle Culpa Aquiliana (Quasi-delict is an example of Extra-contractual

ARTICLE 19, NCC. Every person must, in the exercise of his rights Obligations)  also referred to culpa extra-contractual
and in the performance of his duties, act with justice, give everyone ARTICLE 2176. Whoever by act or omission causes damage to another,
his due, and observe honesty and good faith. 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
If such rules of conduct are violated, the remedy is an action for between the parties, is called a quasi-delict and is governed by the
damages under Article 20 or 21, NCC. provisions of this Chapter.
 What is the difference between culpa extra-contractual and culpa
ARTICLE 20, NCC. Every person who, contrary to law, wilfully or contractual?
negligently causes damage to another, shall indemnify the latter for o Culpa extra-contractual – there is no contract
the same. o GR: You cannot recover based on culpa extra-contractual if
there is a contract.
ARTICLE 21, NCC. Any person who wilfully causes loss or injury o EXC: Existence of a contract is not a total bar in recovering
to another in a manner that is contrary to morals, good customs from quasi delict.
or public policy shall compensate the latter for the damage.  Air France case: When the act that breaks the contract
is also a tort.
(b) Principle of damnun absque injuria  You have the option to choose to recover under quasi-
The proper exercise of a lawful right cannot constitute a legal wrong delict or quasi-contract.
for which an action will lie, although the act may result in damage to  Example: The negligence of the driver is also the
another, for no legal right has been invaded. reason for the breach of the contract of carriage.
 There must be good faith.
2. Breach of Promise of Marriage
(c) Principle of abuse of right
A right, though by itself legal because recognized or granted by law as (a) RULE: A breach of promise to marry per se IS NOT an actionable
such, may nevertheless become the source of some illegality. When a wrong.
right is exercised in a manner which does not conform with the  RATIO: Congress deleted the provisions punishing this. It was the
norms enshrined in Article 19 and results in damage to another, a intention of Congress not to make it an actionable wrong.
legal wrong is thereby committed for which the wrongdoer must be held
responsible. (b) When there is seduction: When the man made use of the promise
of marriage as a subtle scheme or deceptive device to entice the
Elements woman to the sexual act, and such promise is the proximate
 the existence of a legal right or duty; cause why the woman gave herself unto the man in a sexual
 which is exercised in bad faith; and congress, but the man had, in reality, no intention of marrying
 with the sole intent of prejudicing or injuring another. her, the man is liable for damages under Article 21, NCC.
 It connotes the idea of deceit, enticement, superior power, or
Q. Is it possible to abuse a right? YES abuse of confidence on the part of the seducer.
 A right ends when it disappears. It disappears when it is abused.  When there is no seduction and the woman voluntarily gave herself
 The law recognizes the primordial limitation on all rights: that in to the man because of love and mutual passion, damages are not
their exercise, the norms of human conduct set forth in Article 19 awarded.
must be observed. A right, though by itself legal because  This pertains to moral seduction.
recognized or granted by law as such, may nevertheless become o If it’s the woman who seduces the man, will the action
the source of some illegality. prosper? Pwede naman daw
(d) Application of Articles 20, 21, and 2176 (c) When act is contrary to good customs: When the groom led the
 Article 20 applies to both willful and negligent acts that are done bride to believe that the wedding would push through and the
contrary to law. plaintiff has actually incurred expenses for the wedding, the plaintiff
 Article 21 applies only to willful acts done contra bonos mores. has the right to recover money or property, the plaintiff has the right
to recover money or property. (Wassmer v. Velez)
 Article 2176 applies when the negligent act causing damage to
another does not constitute "a breach of an existing law or a
2022 Bar
pre-existing contractual obligation."
Q. A bride declined to appear on her wedding day. Instead, she sent a
o Article 20: violations of existing law as basis for an injury.
note to her prospective groom, saying that she needed to be honest to
o UNLESS: The act that breaks the contract is also a quasi-
herself by admitting that the institution of marriage was not for her. The
delict, tort, or negligence.
bride wrote that she came to this conclusion after contemplating on the
tweets of the #LabGuru. She also wrote that to atone for her non-
Q. What do we call the negligence in Article 1170 NCC? Culpa
appearance, she would post a glowing recommendation of the
contractual
prospective groom as a partner on her Facebook, Twitter, Instagram,
ARTICLE 1170. Those who in the performance of their obligations are
and TikTok accounts.
guilty of fraud, negligence, or delay, and those who in any manner
contravene the tenor thereof, are liable for damages.
The couple had previously dated for almost eight years. The whole time, and other relief against the latter, without prejudice to any disciplinary
the prospective groom had been loyal and caring. administrative action that may be taken.
It was the bride who covered all the wedding expenses. Requisites
(1) Defendant is a public official charged with the performance of
Heartbroken and embarrassed, the prospective groom sued the official duties
prospective bride for moral damages, alleging that she had breached (2) There is a violation of an official duty in favor of an individual
her promise to marry him. (3) There is willfulness or negligence in the violation of such official
duty.
Will the suit prosper? Explain briefly. (4) There is an injury to the individual.
APPLY WASSMER v. VELEZ: This was not a mere breach of promise Article 27 presupposes that the refusal or omission of a public official is
to marry. Liable for damages for being contrary to good customs attributable to malice or inexcusable negligence.
Q. Can you recover moral damages? YES 5. Unfair Competition Under Article 28
ARTICLE 2219. Moral damages may be recovered in the following and
analogous cases: ARTICLE 28, NCC. Unfair competition in agricultural, commercial or
(10) Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32, industrial enterprises or in labor through the use of force, intimidation,
34, and 35. deceit, machination or any other unjust, oppressive or highhanded
The parents of the female seduced, abducted, raped, or abused, method shall give rise to a right of action by the person who thereby
referred to in No. 3 of this article, may also recover moral damages. suffers damage.
The spouse, descendants, ascendants, and brothers and sisters may Unfair competition in Article 28 is much broader than that covered by
bring the action mentioned in No. 9 of this article, in the order named. intellectual property laws.
 The term covers even cases of discovery of trade secrets of a
3. Accion In Rem Verso competitor, bribery of his employees, misrepresentation of all
kinds, interference with the fulfillment of a competitor’s contracts,
Concept: An action of what has been paid or delivered without just or any malicious interference with the latter’s business.
cause or legal ground under Article 22 NCC.  what is being sought to be prevented is not competition per se
but the use of unjust, oppressive or highhanded methods
ARTICLE 22, NCC. Every person who through an act of performance which may deprive others of a fair chance to engage in business or
by another, or any other means, acquires or comes into to earn a living. Plainly, what the law prohibits is unfair competition
possession of something at the expense of the latter without just and not competition where the means used are fair and legitimate.
or legal ground, shall return the same to him.
Requisites for recovery of damages
Requisites (1) it must involve an injury to a competitor or trade rival, and
(1) that the defendant has been enriched, (2) it must involve acts which are characterized as "contrary to good
(2) that the plaintiff has suffered a loss, conscience," or "shocking to judicial sensibilities," or
(3) that the enrichment is without just or legal ground, and otherwise unlawful; in the language of our law, these include
(4) that the plaintiff has no other action based on contract, quasi- force, intimidation, deceit, machination or any other unjust,
contract, crime or quasi-delict oppressive or high-handed method. The public injury or interest
is a minor factor; the essence of the matter appears to be a private
Compared with Solutio Indebiti wrong perpetrated by unconscionable means.
(a) Similarities
(1) Plaintiff has suffered a loss 6. Recovery of Civil Liability Upon Acquittal of Accused
(2) Defendant has been enriched
(3) The enrichment of the defendant is without just or legal ground (a) When the accused not the author of the crime:
(4) Defendant has the obligation to return what was unduly  There is no civil liability ex delicto. (Section 2, Rule 111, Revised
delivered or paid to him by the plaintiff Rules of Criminal Procedure)
(5) The objective is to prevent unjust enrichment o Applies only to a civil action arising from crime or ex
delicto and not to a civil action arising from quasi delict
Solutio Indebiti Accion In Rem Verso or culpa aquiliana.
The source of obligation is the The source of obligation is quasi  The civil liability for the same act considered as quasi-delict
law contract only and not as a crime is NOT extinguished even by a
The delivery or payment to the Delivery or payment is not due to declaration in the criminal case that the criminal act charged has
defendant is by reason of mistake of fact or mistake in the not happened or has not been committed by the accused.
mistake of fact or mistake in the application of a doubtful or
application of a doubtful or difficult provision of law. (b) When acquittal is based on reasonable doubt: He is NOT
difficult provision of law exempt from civil liability ex delicto, which may be proved by
preponderance of evidence only.
4. Liability for Damages Under Article 27; Requisites for
Recover ARTICLE 29, NCC. When the accused in a criminal prosecution is
acquitted on the ground that his guilt has not been proved beyond
ARTICLE 27, NCC. Any person suffering material or moral loss reasonable doubt, a civil action for damages for the same act or
because a public servant or employee refuses or neglects, without omission may be instituted. Such action requires only a
just cause, to perform his official duty may file an action for damages
preponderance of evidence. Upon motion of the defendant, the court (1) Freedom of religion;
may require the plaintiff to file a bond to answer for damages in case (2) Freedom of speech;
the complaint should be found to be malicious. (3) Freedom to write for the press or to maintain a periodical
publication;
If in a criminal case the judgment of acquittal is based upon (4) Freedom from arbitrary or illegal detention;
reasonable doubt, the court shall so declare. In the absence of any (5) Freedom of suffrage;
declaration to that effect, it may be inferred from the text of the (6) The right against deprivation of property without due process of
decision whether or not the acquittal is due to that ground. law;
(7) The right to a just compensation when private property is taken
7. Independent Civil Action for public use;
(8) The right to the equal protection of the laws;
(a) Rule of Implied Institution (9) The right to be secure in one’s person, house, papers, and
effects against unreasonable searches and seizures;
GR: When a criminal action is instituted, the civil action for the recovery (10) The liberty of abode and of changing the same;
of civil liability arising from the offense charged shall be deemed (11) The privacy of communication and correspondence; cd
instituted with the criminal action (12) The right to become a member of associations or societies for
purposes not contrary to law;
EXC: (13) The right to take part in a peaceable assembly to petition the
(1) the offended party waives the civil action, Government for redress of grievances;
(2) reserves the right to institute it separately or (14) The right to be free from involuntary servitude in any form;
(3) institutes the civil action prior to the criminal action. (15) The right of the accused against excessive bail;
(16) The right of the accused to be heard by himself and counsel, to
 After the criminal action has been commenced, the separate be informed of the nature and cause of the accusation against
civil action arising therefrom cannot be instituted until final him, to have a speedy and public trial, to meet the witnesses
judgment has been entered in the criminal action. face to face, and to have compulsory process to secure the
 If the criminal action is filed after the said civil action has attendance of witness in his behalf;
already been instituted, the latter shall be suspended in whatever (17) Freedom from being compelled to be a witness against one’s
stage it may be found before judgment on the merits. The self, or from being forced to confess guilt, or from being induced
suspension shall last until final judgment is rendered in the criminal by a promise of immunity or reward to make such confession,
action. except when the person confessing becomes a State witness;
 Nevertheless, before judgment on the merits is rendered in the (18) Freedom from excessive fines, or cruel and unusual
civil action, the same may, upon motion of the offended party, be punishment, unless the same is imposed or inflicted in
consolidated with the criminal action in the court trying the criminal accordance with a statute which has not been judicially declared
action. unconstitutional; and
(19) Freedom of access to the courts.
(b) When no criminal action instituted
In any of the cases referred to in this article, whether or not the
ARTICLE 30, NCC. When a separate civil action is brought to defendant’s act or omission constitutes a criminal offense, the
demand civil liability arising from a criminal offense, and no criminal aggrieved party has a right to commence an entirely separate and
proceedings are instituted during the pendency of the civil case, distinct civil action for damages, and for other relief. Such civil action
a preponderance of evidence shall likewise be sufficient to prove the shall proceed independently of any criminal prosecution (if the latter
act complained of. be instituted), and may be proved by a preponderance of evidence.
(c) Civil actions not based on delict The indemnity shall include moral damages. Exemplary damages
may also be adjudicated.
ARTICLE 31, NCC. When the civil action is based on an obligation
not arising from the act or omission complained of as a felony, such The responsibility herein set forth is not demandable from a judge
civil action may proceed independently of the criminal proceedings unless his act or omission constitutes a violation of the Penal Code
and regardless of the result of the latter. or other penal statute.
(d) Independent civil Actions ARTICLE 33, NCC. In cases of defamation, fraud, and physical
injuries, a civil action for damages, entirely separate and distinct from
SECTION 3, RULE 111. When civil action may proceeded the criminal action, may be brought by the injured party. Such civil
independently. — In the cases provided for in Articles 32, 33, 34 action shall proceed independently of the criminal prosecution, and
and 2176 of the Civil Code of the Philippines, the independent civil shall require only a preponderance of evidence.
action may be brought by the offended party. It shall proceed
independently of the criminal action and shall require only a Physical injuries – bodily injury, not the specific crime of physical injuries.
preponderance of evidence. In no case, however, may the offended The term includes the crimes of physical injuries, frustrated homicide,
party recover damages twice for the same act or omission charged attempted homicide, or even death.
in the criminal action.
8. Prejudicial Question
ARTICLE 32, NCC. Any public officer or employee, or any private
The issue raised in a pending civil case, the resolution of which
individual, who directly or indirectly obstructs, defeats, violates or in
determines whether or not a criminal action may proceed or determines
any manner impedes or impairs any of the following rights and
the guilt or innocence of the accused.
liberties of another person shall be liable to the latter for damages:
- arises in a case the resolution of which is a logical antecedent of the  NOT CELEBRATED: proper remedy is: petition for correction
issue involved therein, and the cognizance of which pertains to another or cancellation of entry in civil registry (RULE 108)
tribunal.  if marriage was CELEBRATED but VOID AB INITIO, proper
- must precede the criminal action and which requires a decision before remedy is: judicial declaration of nullity of marriage (Morigo)
a final judgment can be rendered in the criminal action with which said  Absence of consent: proper remedy is: petition for correction
question is closely connected. or cancellation of entry in civil registry (RULE 108)
- civil action must be instituted prior to the criminal action
- pending actions must be CIVIL AND CRIMINAL. Not administrative. - even if both PH citizens of the same-sex married abroad, there is no
need to comply with Art. 40 because what took place abroad is not
SEC. 6, RULE 111. Suspension by reason of prejudicial question. — considered as a marriage in Philippine law.
A petition for suspension of the criminal action based upon the
pendency of a prejudicial question in a civil action may be filed in the - If 2nd marriage is alleged to be void, for the accused to be convicted of
office of the prosecutor or the court conducting the preliminary bigamy, the 2nd marriage must have all the essential requisites for the
investigation. When the criminal action has been filed in court for trial, validity except for existence of a prior marriage.
the petition to suspend shall be filed in the same criminal action at = prior institution of a civil action for declaration of nullity of the 2 nd
any time before the prosecution rests. marriage will constitute a prejudicial question to the criminal action
for bigamy
NOT DISMISSED. It can only be made upon petition and not at the
instance of the judge alone or the investigating officer.
 Suspension of the criminal action pending the civil action
ARTICLE 36, NCC. Pre-judicial questions, which must be decided

before any criminal prosecution may be instituted or may proceed,
shall be governed by rules of court which the Supreme Court shall
promulgate and which shall not be in conflict with the provisions of
this Code.
Requisites
(1) the previously instituted civil action involves an issue similar or
intimately related to the issue raised in the subsequent criminal
action, and
(2) the resolution of such issue determines whether or not the
criminal action may proceed.
Nature of Pending Actions

 Generally, a prejudicial question comes into play only in a situation
where a civil action and a criminal action are both pending, and
there exists in the former an issue which must be preemptively
resolved before the criminal action may proceed because the
resolution of the civil action is determinative juris et de jure of the
guilt or innocence of the accused in the criminal case.
 EXC: to avoid conflicting decisions – the doctrine is applied
regardless of the fact that the pending cases are not civil and
criminal.
- crime of bigamy is consummated on the celebration of the subsequent

marriage without the previous one having been judicially declared null
and void.
- even if a petition for declaration of nullity of marriage was filed ahead
of the criminal action for bigamy, the former is not a prejudicial question
because any decision in the civil action will not erase the fact that the
accused in a bigamy case already entered in a subsequent marriage
during the subsistence of the previous one.
Gr: compliance with Art. 40 is required. Judicial declaration of nullity of
marriage
Morigo vs people: no judicial declaration of nullity of marriage is

required in this case there is no marriage to speak of because no
marriage ceremony took place, only a mere signing of marriage contract
without the solemnizing officer.
Republic vs. olaybar: identity theft. Woman claimed her CENOMAR
but she found out she was married to a Korean national. SC allowed
correction of an entry in the civil registry by cancelling the wife portion in
the marriage contract without need for judicial declaration of nullity of
marriage. There was no marriage to speak of bec. the marriage was
NOT CELEBRATED.
III. CIVIL PERSONALITY (3) He may not be ignored by his parents in their testament.
Otherwise, it may result in preterition of a forced heir.
D. Civil Personality (4) A conceived child may be designated as beneficiary in an
insurance policy.
1. Concept
REMEMBER
Definition ARTICLE 1025. In order to be capacitated to inherit, the heir, devisee or
ARTICLE 37, NCC. Juridical capacity, which is the fitness to be the legatee must be living at the moment the succession opens, except in
subject of legal relations, is inherent in every natural person and is case of representation, when it is proper.
lost only through death. Capacity to act, which is the power to do A child already conceived at the time of the death of the decedent
acts with legal effect, is acquired and may be lost. is capable of succeeding provided it be born later under the conditions
 Aptitude to be the subject of rights and obligations. prescribed in article 41.
 In the absence of civil personality, no rights may be acquired and  THIS IS SUBJECT TO THE REQUIREMENT OF ARTICLE 41.
no obligations may be incurred.  The child already INHERITS.
Distinguished from capacity to act (d) When necessary to determine personality of conceived child
 Capacity to act, which is the power to do acts with legal effect, is There is a need to establish the civil personality of the unborn child if his
acquired and may be lost. juridical capacity is the issue involved.
Juridical Capacity Capacity to Act (e) Effect of death upon civil personality
Inherent in every natural person Not inherent but may only be Civil personality of a natural person is extinguished by death.
acquired
May only be lost (in the case of Lost through other means ARTICLE 42, NCC. Civil personality is extinguished by death.
natural person) through death
Cannot be limited or restricted Can be limited or restricted The effect of death upon the rights and obligations of the deceased
is determined by law, by contract and by will.
Are juridical capacity and civil capacity the same? YES
What about legal or juridical capacity? Legal existence? YES Continental Steel Case v. Montano: This case involved death assistance
for a union member. In order for one to die, it must be in possession of
2. Civil Personality of Natural Persons a civil personality. SC says civil personality IS NOT A CONDITION SINE
QUA NON for death. Article 42 merely talks about the death of civil
(a) What determines civil personality in natural persons personality. Death is cessation of life. This is different from the
cessation of civil personality. Even if the child does not meet the
GR: It is birth that determines civil personality. BUT the fetus is requisites of Article 41 NCC, he still died. The condition of “death by a
considered born for civil purposes only when: legitimate dependent” was still met. They should not dwell on the civil
personality of the conceived child. The civil personality of the conceived
donee of simple donation child will only be important if the case involves the rights of the conceived
ARTICLE 41, NCC. For civil purposes, the foetus is considered child. In this case, the rights pertained to the parents as to death
born if it is alive at the time it is completely delivered from the benefits.
mother’s womb. However, if the foetus had an intra-uterine life of
less than seven months, it is not deemed born if it dies within twenty- Q. Does a conceived child possess life? The Constitution recognizes the
four hours after its complete delivery from the maternal womb. existence of life from the moment of conception.
Q. A pregnant pedestrian was hit by a vehicle. The mother and child (6

(1) It is alive at the time it is completely delivered from the womb
months) died. The paternal aunt filed an action for damages against the
(or after cutting the umbilical cord), if the fetus had an intra-
driver. In Article 2206, indemnity for damages may be awarded. (75,000,
uterine life of at least 7 months; OR
currently). Is the plaintiff (paternal aunt) entitled to recover for the death
(2) It survives for at least 24 hours after its delivery, if it had an
of both the mother and child?
intra-uterine life of less than 7 months.
ANSWER: Geluz v. CA: The action primarily belongs to the victim.

(b) Civil Personality of Conceived child
Therefore, the victim should have a legal existence. The action that may
A conceived child, although yet unborn, has a limited and provisional
personality. be filed by the relatives is only ON BEHALF of the victim. Therefore, if
the victim has no personality (Article 41), the derivative action filed
 Limited because it is only for purposes favorable to the child.
on its behalf will likewise NOT PROSPER.
 Provisional because it depends upon the child being born
alive.
3. Civil Personality of Juridical Persons
(c) Consequences of civil personality of conceived child
ARTICLE 44, NCC. The following are juridical persons:
It can acquire rights but it cannot incur obligations.
(1) The State and its political subdivisions;
(2) Other corporations, institutions and entities for public
Rights:
interest or purpose, created by law; their personality begins as
(1) The right to be a donee of simple donations, but acceptance shall
soon as they have been constituted according to law;
be made by persons who would legally represent him if he were
(3) Corporations, partnerships and associations for private interest
already born
or purpose to which the law grants a juridical personality,
(2) Right to receive support
separate and distinct from that of each shareholder, partner or
member.
C i vi l L a w R e vi e w 2 0 2 2 ( P r o f . R a b u ya ) D e L e o n | 10
State and its political Personality begins as soon as they have SEC. 3 (jj), RULE 131.
subdivisions been constituted according to the law. (jj) That except for purposes of succession, when two persons
Other corporations, Personality begins as soon as they have perish in the same calamity, such as wreck, battle, or
institutions and been constituted according to the law. conflagration, and it is not shown who died first, and there are
entities for public no particular circumstances from which it can be inferred, the
interest or purpose, survivorship is determined from the probabilities resulting from
created by law; their the strength and the age of the sexes, according to the following
personality begins as rules:
soon as they have 1. If both were under the age of fifteen years, the older is
been constituted deemed to have survived;
according to law 2. If both were above the age sixty, the younger is deemed
Private corporations A private corporation organized under the to have survived;
Corporation Code commences its 3. If one is under fifteen and the other above sixty, the
corporate existence and juridical former is deemed to have survived;
personality from the date the SEC issues 4. If both be over fifteen and under sixty, and the sex be
the certificate of incorporation under its different, the male is deemed to have survived, if the sex
official seal. be the same, the older; and
Partnership two or more persons bind themselves to 5. If one be under fifteen or over sixty, and the other
contribute money, property, or industry to a between those ages, the latter is deemed to have
common fund, with the intention of dividing survived.
the profits among themselves.
When does this apply?
ARTICLE 1771. A partnership may be  (1) If the issue is not successional right; AND/OR
constituted in any form, except where  (2) If the parties are not heirs of each other.
immovable property or real rights are
contributed thereto, in which case a public Q. Father and son boarded a boat. The father previously took out an
instrument shall be necessary. insurance policy. They both died. The father was 65, the son was 30. Is
the widow of the son entitled to recover the insurance proceeds? YES.
ARTICLE 1773. A contract of partnership is This is covered by Rule 131 because the issue concerns INSURANCE
void, whenever immovable property is POLICY, not succession. The son is presumed to survive the father. The
contributed thereto, if an inventory of said insurance policy forms part of the son’s estate, which can be inherited
property is not made, signed by the parties, by the widow.
and attached to the public instrument.
Sole Proprietorship Does not possess a juridical personality
separate and distinct from the personality
of the owner of the enterprise.
4. Rules on Survivorship
(a) If issue is succession

ARTICLE 43, NCC. If there is a doubt, as between two or more
persons who are called to succeed each other, as to which of them
died first, whoever alleges the death of one prior to the other, shall
prove the same; in the absence of proof, it is presumed that they died
at the same time and there shall be no transmission of rights from
one to the other.
Requisites:
(1) The questions of survivorship involves persons who are called
to succeed each other, whether the succession is by reason of a
will or by operation of law; AND
(a) They are HEIRS of each other.
(b) Do they inherit from each other?
(2) The issue involves transmission of successional rights between
them.
Rules
(1) whoever alleges the death of one prior to the other, shall prove the
same
(2) in the absence of proof, it is presumed that they died at the
same time and there shall be no transmission of rights from one
to the other.
(a) THEREFORE, they WILL NOT INHERIT from each other
(b) If issue is not succession

IV. MARRIAGE the property relations during the marriage within the limits
provided by this Code.
Family Code: Became effective on August 3, 1988. - the nature, consequences, and incidents of marriage are governed by
law and not subject to stipulation except property relations during the
marriage within limits provided by FC.
Doctrine of Separation of Church and State not applicable:

Although, marriage is considered a sacrament in the Catholic church, it
has civil and legal consequences which are governed by the Family
Code. (Tilar v. Tilar)
This contract is NOT VALID.
Annulment by the church and annulment by the state ARE DIFFERENT.
What is the duration of marriage? IT IS A CONTRACT OF PERMANENT
It is the annulment of the state that is binding.
UNION. It can only be terminated by death or an order by the court in
declarations of nullity or by reasons of decree of absolute divorce,
Falcis case: Atty. Falcis filed a case asking the court to allow same-sex
recording of affidavit of reappearance.
marriage. The current definition was against equal protection. The SC
dismissed the case on procedural grounds. There was no actual
E. Requisites for a Valid Marriage
controversy since Atty. Falcis was not married or engaged. Atty. Falcis
was effectively asking the court to make an interpretation of the law
1. Concept of Marriage
without a controversy.
(a) Dual Concept

(d) Presumptions favoring marriage
(1) As a contract:
(1) That a man and woman deporting themselves as husband and
wife have entered into a lawful contract of marriage;
ARTICLE 1, FC. Marriage is a special contract of permanent
(2) the law favors the validity of marriage and the burden of proof to
union between a man and a woman entered into in accordance with
show the nullity of the marriage rests upon the party seeking its
law for the establishment of conjugal and family life. It is the
nullity.
foundation of the family and an inviolable social institution whose
nature, consequences, and incidents are governed by law and not
2. Requisites for Valid Marriage
subject to stipulation, except that marriage settlements may fix the
property relations during the marriage within the limits provided by
In a marriage between Filipinos
this Code.
 Always look at the place of celebration of marriage first
(2) As a social institution

(a) For Marriages Celebrated Abroad
Our Constitution clearly gives value to the sanctity of marriage. Marriage
in this jurisdiction is not only a civil contract, but it is a new relation, an
ARTICLE 26 (paragraph 1), FC. Art. 26. All marriages solemnized
institution the maintenance of which the public is deeply interested. (Tilar
outside the Philippines, in accordance with the laws in force in the
v. Tilar)
country where they were solemnized, and valid there as such, shall
also be valid in this country, except those prohibited under Articles
(b) Constitutional Provisions
35 (1), (4), (5) and (6), 36, 37 and 38.
SEC. 12, ARTICLE II, CONST. The State recognizes the sanctity of
Where a marriage between a Filipino citizen and a foreigner is validly
family life and shall protect and strengthen the family as a basic
celebrated and a divorce is thereafter validly obtained abroad by the
autonomous social institution. It shall equally protect the life of the
alien spouse capacitating him or her to remarry, the Filipino spouse
mother and the life of the unborn from conception. The natural and
shall have capacity to remarry under Philippine law.
primary right and duty of parents in the rearing of the youth for civic
efficiency and the development of moral character shall receive the
 GR: If valid abroad, the marriage is also valid in the PH, even if
support of the Government.
such marriage is void in the PH
 EXC: Article 35 (1, 4, 5, 6), 36, 37, 38
SEC. 1, ARTICLE XV, CONST. The State recognizes the Filipino
family as the foundation of the nation. Accordingly, it shall strengthen
ARTICLE 35, FC. The following marriages shall be void from the
its solidarity and actively promote its total development.
beginning:
(1) Those contracted by any party below eighteen years of age
SEC. 2, ARTICLE XV, CONST. Marriage, as an inviolable social
even with the consent of parents or guardians;
institution, is the foundation of the family and shall be protected by
(2) Those solemnized by any person not legally authorized to
the State.
perform marriages unless such marriages were contracted with
either or both parties believing in good faith that the solemnizing
(c) Marriage governed by law
officer had the legal authority to do so;
(3) Those solemnized without license, except those covered the
Rule:
preceding Chapter;
ARTICLE 1, FC. Marriage is a special contract of permanent union
(4) Those bigamous or polygamous marriages not failing under
between a man and a woman entered into in accordance with law for
Article 41;
the establishment of conjugal and family life. It is the foundation of
(5) Those contracted through mistake of one contracting party
the family and an inviolable social institution whose nature,
as to the identity of the other; and
consequences, and incidents are governed by law and not
(6) Those subsequent marriages that are void under Article 53.
subject to stipulation, except that marriage settlements may fix
ARTICLE 36, FC. A marriage contracted by any party who, at the

time of the celebration, was psychologically incapacitated to comply (2) Formal Requisites
with the essential marital obligations of marriage, shall likewise be  Authority of the solemnizing officer
void even if such incapacity becomes manifest only after its  Valid marriage license
solemnization. (As amended by Executive Order 227)  Marriage ceremony
ARTICLE 37, FC. Marriages between the following are incestuous Effect of ABSENCE of Requisites
and void from the beginning, whether relationship between the Requisite Effect
parties be legitimate or illegitimate:  Legal capacity Marriage is Void
(1) Between ascendants and descendants of any degree; and  Valid marriage license
(2) Between brothers and sisters, whether of the full or half blood.  Authority of the solemnizing officer
- XPN:
ARTICLE 38, FC. The following marriages shall be void from the In case of absence of authority of the solemnizing
beginning for reasons of public policy: officer, the marriage is valid when either or both
(1) Between collateral blood relatives whether legitimate or parties believed in good faith that the solemnizing
illegitimate, up to the fourth civil degree; officer had the legal authority to do so. It must be
mistake of fact, not law.
(2) Between step-parents and step-children;
Consent No marriage
(3) Between parents-in-law and children-in-law;
(4) Between the adopting parent and the adopted child; Marriage ceremony No marriage
(5) Between the surviving spouse of the adopting parent and the
adopted child; ARTICLE 4, paragraph 1, FC. The absence of any of the essential
(6) Between the surviving spouse of the adopted child and the or formal requisites shall render the marriage void ab initio, except as
adopter; stated in Article 35 (2).
(7) Between an adopted child and a legitimate child of the adopter;
(8) Between adopted children of the same adopter; and A defect in any of the essential requisites shall render the
(9) Between parties where one, with the intention to marry the marriage voidable as provided in Article 45.
other, killed that other person’s spouse, or his or her own
spouse. An irregularity in the formal requisites shall not affect the
validity of the marriage but the party or parties responsible for the
(b) For marriages Celebrated in the PH irregularity shall be civilly, criminally and administratively liable.
ARTICLE 2, FC. No marriage shall be valid, unless these essential Distinctions Between Void and No Marriage
requisites are present: Void No Marriage
(1) Legal capacity of the contracting parties who must be a male The proper remedy is a petition Remedy is petition for
and a female; and for Declaration of Absolute correction and/or cancellation
(2) Consent freely given in the presence of the solemnizing officer. Nullity of Marriage. of entry in the civil registry
under Rule 108.
ARTICLE 3, FC. The formal requisites of marriage are: A petition for correction or
(1) Authority of the solemnizing officer; cancellation of an entry in the
(2) A valid marriage license except in the cases provided for in civil registry cannot substitute for
Chapter 2 of this Title; and an action to invalidate a
(3) A marriage ceremony which takes place with the appearance of marriage.
the contracting parties before the solemnizing officer and their Requirement of obtaining a
personal declaration that they take each other as husband and judicial declaration of absolute
wife in the presence of not less than two witnesses of legal age. nullity of the marriage prior to
contracting another marriage in
Q. When is the FC not applicable in determining the validity of Article 40 FC does not apply.
marriages? Depends on when the marriage was celebrated. If before
August 3, 1988 (FC effectivity), then NCC applies. The marriage is ARTICLE 40, FC. The absolute nullity of a previous marriage may
governed by the law effective at the time of the marriage. Otherwise, be invoked for purposes of remarriage on the basis solely of a final
there will be an impairment of rights. judgment declaring such previous marriage void.
If the marriage is void ab initio, this applies.
Example: In a marriage between step siblings, if it was celebrated before
the FC, the marriage is void. After the effectivity of the FC, this is Effect of Defect in Consent
allowed. ARTICLE 4, paragraph 2, FC. The absence of any of the essential
or formal requisites shall render the marriage void ab initio, except as
As to legitimation of the child, you look at the conception of the child. If stated in Article 35 (2).
conceived before the FC, there is an impediment to legitimation since
marriage between step siblings was prohibited. After the FC, there is NO A defect in any of the essential requisites shall render the marriage
impediment. voidable as provided in Article 45.
Essential and Formal Requisites An irregularity in the formal requisites shall not affect the validity of
Classified Into: the marriage but the party or parties responsible for the irregularity
(1) Essential Requisites shall be civilly, criminally and administratively liable.
 Legal Capacity
 Consent Effect of Irregularity in formal requisite
ARTICLE 4, paragraph 3, FC. The absence of any of the essential (9) Between parties where one, with the intention to marry the
or formal requisites shall render the marriage void ab initio, except as other, killed that other person’s spouse, or his or her own
stated in Article 35 (2). spouse.
A defect in any of the essential requisites shall render the marriage Sexes of Parties
voidable as provided in Article 45. (a) Validity of same-sex marriage
 Not recognized as valid in the PH, even if the marriage is
An irregularity in the formal requisites shall not affect the solemnized abroad and valid there as such.
validity of the marriage but the party or parties responsible for o EXC: Foreigners
the irregularity shall be civilly, criminally and administratively
liable. (b) Effect of Sex Reassignment Surgery
 GR: There is no law legally recognizing sex reassignment
(Silverio v. Republic)
o EXC: if the person who underwent sex reassignment surgery
is a foreigner and his national law allows him to have a
change of sex by reason of sex reassignment surgery.
o The sex of a person is governed by national law.
 Sex is determined at birth (Act No. 3753)
(c) Effect of doubt in genitals is by reason of nature

 Congenital adrenal hyperplasia
There was an irregularity in the authority of the solemnizing officer. This  Can this be done administratively before the local civil registrar?
does not affect the validity of the marriage. The SC justice has authority NO
to solemnize the marriage. But this must be done in sala. o Only typographical or clerical errors are allowed for civil
registrar corrections.
3. Legal Capacity to Contract Marriage o This must be judicial (Republic v. Cagandahan)
 The determining factor in gender classification would be what the
Requisites for Legal Capacity individual, having reached the age of majority, with good
(a) Foreigners: Governed by national law reason thinks of his or her sex.
(1) They must submit a certificate of legal capacity to contract
marriage issued by their diplomatic or consular officials 4. Consent
(b) Filipinos
(1) A male and a female (a) Effect of Absence of Consent
(2) At least 18  There is NO MARRIAGE.
(3) Must not be suffering from any legal impediment under
 Remedy: petition for correction and/or cancellation of entry in the
Articles 37, 38 FC
civil registry under Rule 108.
Q. Same-sex Filipino couple married abroad where same-sex marriage

(b) Effect of Defect in Consent: VOIDABLE (Art. 45 FC)
was allowed. What is the status of the marriage? There was NO
MARRIAGE at all.
(c) Meaning of Consent
 Consent in marriage is the personal declaration made by the
Sex is determined by visual examination of the genitals.
groom and the bride during the marriage ceremony that they are
taking each other as husband and wife.
Q. What if the attendant committed a clerical error. Instead of female,
o If such consent is given during the marriage ceremony and the
male was indicated. May this be corrected? YES. The party may make
same is not defective, the marriage is perfectly valid.
an administrative correction if it was a clerical or typographical error.
o Absence of love will not make it invalid. (Republic v. Albios)
ARTICLE 37, FC. Marriages between the following are incestuous

Republic v. Olaybar: Olaybar was already married to a Korean national
and void from the beginning, whether relationship between the
according to records. This is a case of identity theft. She filed a petition
parties be legitimate or illegitimate:
for cancellation of entry in the Civil Registry under Rule 108. The OSG
(3) Between ascendants and descendants of any degree; and
opposed, saying she should have filed a petition for declaration of nullity
(4) Between brothers and sisters, whether of the full or half blood.
of marriage. SC said that since there was no marriage at all, there was
nothing to annul.
ARTICLE 38, FC. The following marriages shall be void from the
beginning for reasons of public policy: Morigo v. People: There was no solemnizer. The parties signed a
(1) Between collateral blood relatives whether legitimate or private marriage contract, which was eventually recorded in the civil
illegitimate, up to the fourth civil degree; registry. The husband married someone else. The SC acquitted him of
(2) Between step-parents and step-children; bigamy. There was no marriage to speak of. Article 40 presupposes a
(3) Between parents-in-law and children-in-law; prior void marriage. The state must participate in the celebration of the
(4) Between the adopting parent and the adopted child; contract. This case was simply a private agreement between the parties.
(5) Between the surviving spouse of the adopting parent and the
adopted child; 5. Valid Marriage License
(6) Between the surviving spouse of the adopted child and the
adopter; Always check the date of validity of the marriage license.
(7) Between an adopted child and a legitimate child of the adopter;
(8) Between adopted children of the same adopter; and (a) Effect of absence of marriage license
 VOID (4) Marriages involving a man and a woman who have been
 If the marriage license is spurious or fake: VOID living together as a husband and wife for at least five
 The absence of such marriage license must be apparent on the years before the marriage and who, during the said
marriage contract, or supported by a certification from the local civil period, were not suffering from any legal impediment
registrar that no such marriage was issued to the parties.
o Certification must categorically state that the document ARTICLE 34, FC. No license shall be necessary for the marriage
does not exist after diligent search. of a man and a woman who have lived together as husband and wife
o If there is no showing that the local civil registry exerted for at least five years and without any legal impediment to marry
diligent efforts to locate the records of the license, the each other. The contracting parties shall state the foregoing facts in
marriage cannot be declared void. an affidavit before any person authorized by law to administer oaths.
 Certification issued by the local civil registrar that their office has The solemnizing officer shall also state under oath that he
no record of the alleged marriage is adequate to prove the non- ascertained the qualifications of the contracting parties are found no
issuance of a marriage license in the absence of any circumstance legal impediment to the marriage.
of suspicion.
o Carino v. Carino; Republic v. CA; Sevilla v. Cardenas The five-year period must:
o Vitangcol v. People: Presumption of regularity cannot be  Continuous or uninterrupted
accorded the certification if the purpose is to obtain acquittal  Absence of impediment
from criminal prosecution for bigamy.  Counted backwards from the day of the celebration of the marriage
 Accused may be tempted to bribe government officials to  Characterized by exclusivity (no third party at any time)
obtain the certification. o The falsity of an affidavit of cohabitation in the second
 Such certification is not sufficient for a defense. marriage cannot be used as a defense in the crime of bigamy.
 This will find significance in Pulido v. People.
o Pulido v. People: If the prior marriage can be proven to be The requirement of affidavit by the parties is ADMINSITRATIVE for the
truly VAI, the crime of bigamy is NOT committed even if the protection of the solemnizing officer.
subsequent marriage was celebrated without a prior judicial
declaration of the absolute nullity of the prior void marriage. There must be a sworn statement by the solemnizing officer.
The liability under Article 40 is only civil.  The contracting parties shall state the foregoing facts in an affidavit
 Article 349 RPC: applies when there is a prior VALID before any person authorized by law to administer oaths. The
marriage and the subsequent marriage was celebrated solemnizing officer shall also state under oath that he ascertained
during the subsistence of the prior valid marriage. the qualifications of the contracting parties are found no legal
 This is now a defense in bigamy. impediment to the marriage
 This is an administrative requirement.
(b) Effect of Irregularity in issuance of marriage license
 The validity is not affected. 6. Authority of Solemnizing Officer
 The party responsible shall be civilly, criminally, and
administratively liable. (a) Effect of Absence of Authority
 GR: VOID
(c) Marriages exempt from requirement of marriage license  EXC: Good faith
(1) Articulo mortis marriages ARTICLE 35, FC. The following marriages shall be void from the
beginning:
ARTICLE 27, FC. In case either or both of the contracting parties are (2) Those solemnized by any person not legally authorized to perform
at the point of death, the marriage may be solemnized without marriages unless such marriages were contracted with either or both
necessity of a marriage license and shall remain valid even if the parties believing in good faith that the solemnizing officer had the
ailing party subsequently survives. legal authority to do so;
(2) Marriages among Muslims or members of ethnical (b) Effect of Irregularity in Exercise of Authority
cultural communities  Marriage is valid
 The party responsible shall be civilly, criminally, and
ARTICLE 33, FC. Marriages among Muslims or among members of administratively liable.
the ethnic cultural communities may be performed validly without the
necessity of marriage license, provided they are solemnized in (c) Persons authorized to solemnize the marriage
accordance with their customs, rites or practices.
There are six.
(3) Marriages where the residence of either party is so ARTICLE 7, FC. Marriage may be solemnized by:
located that there is no means of transportation to enable (1) Any incumbent member of the judiciary within the court’s
such party to appear personally before the local civil jurisdiction;
registrar. (2) Any priest, rabbi, imam, or minister of any church or religious
sect duly authorized by his church or religious sect and
ARTICLE 28, FC. If the residence of either party is so located that registered with the civil registrar general, acting within the limits
there is no means of transportation to enable such party to appear of the written authority granted by his church or religious sect
personally before the local civil registrar, the marriage may be and provided that at least one of the contracting parties belongs
solemnized without necessity of a marriage license. to the solemnizing officer’s church or religious sect;
(3) Any ship captain or airplane chief only in the case mentioned in
Article 31;
(4) Any military commander of a unit to which a chaplain is Can there be a marriage between civilians? YES
assigned, in the absence of the latter, during a military
operation, likewise only in the cases mentioned in Article 32; ARTICLE 32, FC. A military commander of a unit, who is a
(5) Any consul-general, consul or vice-consul in the case provided commissioned officer, shall likewise have authority to solemnize
in Article 10. marriages in articulo mortis between persons within the zone of
military operation, whether members of the armed forces or civilians.
(1) Incumbent members of the judiciary within the court’s
jurisdiction (5) Consul-general, consul or vice-consul, in limited cases.
(a) Requisites (a) Requisites
(i) Incumbent (i) Marriage must be celebrated abroad in the country
(ii) Within the court’s jurisdiction where the consul holds office
1) This only applies to RTCs and MTCs (ii) Marriage must be between Filipino citizens
2) Navarro v. Domagtoy (obiter): Celebration of the
marriage outside the jurisdiction of the court does ARTICLE 10, FC. Marriages between Filipino citizens abroad may
not result in the invalidity of the marriage. Sir be solemnized by a consul-general, consul or vice-consul of the
doesn’t agree but this will do for the bar. Sir believes Republic of the Philippines. The issuance of the marriage license and
the place of celebration is part of the impartment of the duties of the local civil registrar and of the solemnizing officer with
authority. Outside the territorial jurisdiction of the regard to the celebration of marriage shall be performed by said
RTC judge, he is bereft of authority. This is an consular official.
absence of authority, not a mere irregularity. This is
not a binding precedent because this involves the (6) Mayors.
administrative liability of the erring judge. After the effectivity of the FC on August 3, 1988 and before the effectivity
(2) Priest, rabbi, imam or minister of any church or religious sect of the LGC (Jan. 1, 1992), mayors did not have authority.
duly authorized by his church or religious sect;
(a) Requisites 7. Marriage Ceremony
(i) Must be duly authorized by his respective church or sect
in writing (a) What constitutes a marriage ceremony?
(ii) His written authority must be duly registered with the Civil  No prescribed form or religious right
Register General ARTICLE 6, FC. No prescribed form or religious rite for the
1) PSA issues authority. solemnization of the marriage is required. It shall be necessary,
(iii) He must act within the limits of such written authority however, for the contracting parties to appear personally before the
1) If he exceeds his authority, then there is an solemnizing officer and declare in the presence of not less than two
ABSENCE of authority and the marriage is VAI. witnesses of legal age that they take each other as husband and wife.
2) Unless the parties invoke good faith This declaration shall be contained in the marriage certificate which
(iv) At least one of the contracting parties must belong to his shall be signed by the contracting parties and their witnesses and
church or sect attested by the solemnizing officer.
1) If the parties did not belong to the sect or religion,
good faith cannot be invoked if they were aware of In case of a marriage in articulo mortis, when the party at the point of
this fact. This is a mistake of law. death is unable to sign the marriage certificate, it shall be sufficient
for one of the witnesses to the marriage to write the name of said
Q. What if he was never issued authority? The marriage is valid since party, which fact shall be attested by the solemnizing officer.
the spouses believed in good faith in the authority of the solemnizer.
Minimum Requirements
(3) Ship captain or airplane chief, in cases of articulo mortis;  Personal appearance of the contracting parties before a
(a) Requisites solemnizing officer
(i) Marriage must be in articulo mortis  Personal declaration in the presence of the solemnizing officer that
(ii) Marriage must be between passengers and/or crew they take each other as husband and wife.
members
(b) Such authority may be exercised while the ship is at sea or (b) Requisites for marriage ceremony to exist
the plane is in flight and during stopovers at port of call. (1) Personal appearance of the contracting parties before a
solemnizing officer
ARTICLE 31, FC. A marriage in articulo mortis between passengers (2) Personal declaration in the presence of the solemnizing
or crew members may also be solemnized by a ship captain or by an officer that they take each other as husband and wife.
airplane pilot not only while the ship is at sea or the plane is in flight, o A declaration by word of mouth of what the parties had already
but also during stopovers at ports of call. stated in writing would be a mere repetition, so that its
omission should not be regarded as a fatal defect.
(4) Military commanders of a unit, in cases of articulo mortis; (3) Such personal declaration must be done in the presence of
(a) Requisites the solemnizing officer.
(i) Must be a commission officer, or an officer in the armed
forces holding rank by virtue of a commission from the 8. Marriage Contract
President
(ii) Assigned chaplain to his unit must be absent (a) Importance of marriage contract
(iii) Marriage must be in articulo mortis o Best documentary evidence of a marriage
(iv) Marriage must be solemnized within the zone of military
operations. (b) Effect of Absence of Marriage Contract
o Absence is not proof that no marriage took place because decree when such was invoked by a party as an integral aspect of
other evidence may be presented to prove the fact of his claim or defense.
marriage. o Thus even if the Spouse immediately remarries, he is not
o As long as in the celebration of marriage, all requisites for its automatically liable for bigamy.
validity are present.
Principle Applied to Foreign Judgment Involving Bigamy
(c) Other Proofs of Marriage  No need to retroactively apply Article 26, Paragraph 2 FC.
o Testimony of a witness to the matrimony  There is sufficicient jurisprudential basis to apply the rule to
o Couple’s public and open cohabitation as husband and wife absolute divorces obtained by the foreign spouse prior to the
after the alleged wedlock effectivity of the FC (Van Dorn v. Romillo Jr, Pilapil v. Ibay-Somera,
o Birth and baptismal certificates of children born during Quita v. CA)
such union
o Mention of such nuptial in subsequent documents. G. Void Marriages
F. Rules on Validity of Absolute Divorces 1. Concept and Characteristics of Void Marriages
1. Summary of Rules on Absolute Divorce (a) Concept and Characteristics of Void Marriages
(1) PH laws do not provide for absolute divorce. Hence, the courts ARTICLE 40, FC. The absolute nullity of a previous marriage may be
cannot grant the same. invoked for purposes of remarriage on the basis solely of a final
(2) The marital bond between two Filipino citizens cannot be judgment declaring such previous marriage void.
dissolved even by absolute divorce obtained abroad. (Article 15,
17, NCC)  GR: It is inexistent from the beginning. Hence, if the marriage is
(3) An absolute divorce obtained abroad by a couple (both aliens) may VAI, it is ipso facto void without need of any judicial declaration
be recognized in the PH (provided it is consistent with their national of nullity.
laws).  EXC: For purposes of remarriage, even if the prior marriage is VAI,
(4) In mixed marriages involving a Filipino and a foreigner, the former a judicial declaration of its nullity is required before a subsequent
is allowed to contract a subsequent marriage in case the absolute marriage can be contracted. OTHERWISE, the subsequent
divorce is validly obtained abroad by the alien spouse, capacitating marriage itself is VAI and the second marriage contracted results
her to marry. in the crime of bigamy.
o See Pulido
2. Rules as to Divorce Between Filipinos
(b) Can be attacked collaterally
 No divorce in PH laws.  A void marriage can be attacked collaterally.
 Contrary to public policy and morality  void.  For other purposes, such as determination of heirship, legitimacy,
settlement of estate, dissolution of property regime, or a criminal
3. Rule in Mixed Marriages case, the court may pass upon the validity of marriage even in a
suit not directly instituted to question the same so long as it is
RULE: In mixed marriages involving a Filipino and a foreigner, the essential to the determination of the case.
former is allowed to contract a subsequent marriage in case the absolute o “on the basis solely of a final judgment declaring such
divorce is validly obtained abroad by the alien spouse, capacitating previous marriage void.” – connotes that the final judgment
her to remarry. need not be obtained solely for remarriage.
 BUT in Braza v. The City Civil Registrar of Himamaylan City:
Requisites TC has no jurisdiction to nullify marriages in a special proceeding
(1) There is a valid marriage celebrated between a Filipino and a for cancellation or correction of entry under Rule 108.
foreigner o NOTE: The marriage in this case was void. The proper
(2) A valid divorce is obtained abroad, REGARDLESS of who remedy is petition for declaration for of absolute nullity.
between the spouses initiated the divorce proceedings. o In Olaybar, there is NO MARRIAGE to speak of. The proper
remedy is a petition for cancellation of entry in the civil registry.
Reckoning Point in determining citizenship
 Citizenship at the time a valid divorce is obtained abroad by the (c) Can be questioned even after death
alien spouse.  If the void marriage was celebrated during the effectivity of the
 Once it is proven that a party was no longer a Filipino citizen when FC, therefore covered by A.M. No. 02-11-10-SC, a petition for
he obtained the divorce from his Filipino spouse, Article 26, declaration of absolute nullity can only be filed during the lifetime
paragraph 2 FC would be applicable. of the spouses.
 Article 26, paragraph 2 FC can be invoked only by the Filipino, not o After the death of one of the spouses, the validity of the
the alien. marriage may still be question by way of a collateral attack in
the proceeding for the settlement of the estate of the
When a Filipino spouse regains capacity to Remarry deceased spouses.
 Republic v. Cote (obiter): Before a divorced Filipino can remarry,  If the void marriage was celebrated before the effectivity of the
he must file a petition for judicial recognition of the foreign FC, it can be questioned even AFTER the death of one of the
divorce. (Rabuya: Sarto is the better rule) spouses either by way of direct action or a collateral attack in the
 Sarto v. People: Recognition of the divorce decree, however, need proceeding for the settlement of the deceased spouse.
not be obtained in a separate petition filed solely for that
purpose. Philippine courts may recognize the foreign divorce (d) Imprescriptible
(e) Who can question?

In the partition, the conjugal dwelling and the lot on which it is
(1) DIRECT ACTION situated, shall be adjudicated in accordance with the provisions of
o Section 2(a), A.M. No. 02-11-10-SC: By direct action, a Articles 102 and 129.
petition for declaration of absolute nullity of void marriage may
be filed solely by the husband or the wife if the marriage was ARTICLE 51, FC. In said partition, the value of the presumptive
celebrated DURING the effectivity of the FC. legitimes of all common children, computed as of the date of the
 Only during the lifetime of the spouses. final judgment of the trial court, shall be delivered in cash,
o If the ground is bigamy, even the aggrieved spouse in the property or sound securities, unless the parties, by mutual agreement
prior marriage may file the action. judicially approved, had already provided for such matters.
 Because it is the spouse in the prior marriage who is the
aggrieved party. The children or their guardian or the trustee of their property may ask
o If the marriage was celebrated PRIOR to the effectivity of the for the enforcement of the judgment.
FC, ANY REAL PARTY IN INTEREST may file the petition.
(2) COLLATERAL ATTACK The delivery of the presumptive legitimes herein prescribed shall in
o Any proper interested party may attack a void marriage. no way prejudice the ultimate successional rights of the children
 Interest refers to successional rights. accruing upon the death of either of both of the parents; but the value
 Compulsory or intestate heirs of the properties already received under the decree of annulment or
 Can be attacked even after the lifetime of the spouses. absolute nullity shall be considered as advances on their legitime.
o Proceeding
 Proceeding for settlement of the estate of the deceased ARTICLE 52, FC. The judgment of annulment or of absolute
spouse for marriages covered by A.M. No. 02-11-10-SC nullity of the marriage, the partition and distribution of the properties
or of the spouses and the delivery of the children’s presumptive
 petition for declaration of nullity of the marriage for legitimes shall be recorded in the appropriate civil registry and
marriages celebrated under the CC. registries of property; otherwise, the same shall not affect third
persons.
2. Effect of Void Marriages
 If the ground for nullity is lack of marriage license, will the
(a) As to right to remarry – compliance with Article 40 procedures be subject to the requirements under said
(1) Parties to a void marriage may contract another marriage articles? NO. Said articles only apply to void marriages under
PROVIDED that they first secure a judicial declaration of Article 40 FC and there was a declaration of nullity of marriage.
the nullity of their marriage (Dino v. Dino)
o Otherwise, the subsequent marriage is bigamous AND void.
 GR: 50 & 51 do not apply to void marriages in general
o Bigamy is also committed.
o EXCEPT:
o If the ground for the nullity of marriage is Article 40, there must
 Marriages that were annulled under 45
be compliance with the requirements of liquidation, partition,
 Marriages declared void Article 40 (judicial declaration).
and distribution of properties of the erstwhile spouse, the
 Articles 50 & 51 in relation to Article 40 will only apply if the property
delivery of presumptive legitimes, and compliance with the
regime is ACP or CPG.
requirements of Article 52, FC.
o NOT complete separation.
 When there are no properties that can be subjected to liquidation
Pulido v. People:
and partition.
 Abandoned previous ruling: Mercado v. Tan, Abunado, Bobis.
 Article 52 & 53 apply only to those covered by the procedures under
o Where: In cases where Article 40 is not followed, bigamy is
Articles 50 & 51.
committed even if the prior marriage is proven to be VAI.
There mere contracting of the subsequent marriage without a
(b) Parties are not spouses
judicial declaration of the prior void marriage results in the
(1) Not obligated to support each other
crime of bigamy.
(2) Not entitled to successional rights
 Article 40 did not alter the RPC on bigamy (Article 349).
o Bigamy can only be committed if the marriage is perfectly valid
(c) Status of the children
or voidable. A void marriage was a defense.
(1) RULE: Children of Void Marriages are generally illegitimate.
o Mercado v. Tan, Marvella v. Bobis changed this.
(2) EXC: Children of void marriages under Articles 36 and 53 are
exceptionally declared legitimate.
ARTICLE 50, FC. The effects provided for by paragraphs (2), (3), (4)
and (5) of Article 43 and by Article 44 shall also apply in the proper
ARTICLE 36, NCC. A marriage contracted by any party who, at the
cases to marriages which are declared ab initio or annulled by final
time of the celebration, was psychologically incapacitated to
judgment under Articles 40 and 45.
comply with the essential marital obligations of marriage, shall
likewise be void even if such incapacity becomes manifest only after
The final judgment in such cases shall provide for the liquidation,
its solemnization. (As amended by Executive Order 227)
partition and distribution of the properties of the spouses, the custody
and support of the common children, and the delivery of third
ARTICLE 53, NCC. No marriage shall be solemnized unless all these
presumptive legitimes, unless such matters had been adjudicated in
requisites are complied with:
previous judicial proceedings.
(1) Legal capacity of the contracting parties;
(2) Their consent, freely given;
All creditors of the spouses as well as of the absolute community or
(3) Authority of the person performing the marriage; and
the conjugal partnership shall be notified of the proceedings for
liquidation.
(4) A marriage license, except in a marriage of exceptional ARTICLE 35, FC. The following marriages shall be void from the
character beginning:
(1) Those contracted by any party below eighteen years of age
(d) Effect on property relations even with the consent of parents or guardians;
(1) GR: In void marriages, regardless of the cause, the property (2) Those solemnized by any person not legally authorized to
relations of the parties during the period of cohabitation are perform marriages unless such marriages were contracted with
governed by Article 147 or 148. either or both parties believing in good faith that the solemnizing
(2) EXC: If the marriage is declared void by reason of non- officer had the legal authority to do so;
compliance with Article 40 FC, the applicable property (3) Those solemnized without license, except those covered the
regime is ACP, CPG, or CS of property as the case may be. preceding Chapter;
(4) Those bigamous or polygamous marriages not failing under
ARTICLE 147, FC. When a man and a woman who are Article 41;
capacitated to marry each other, live exclusively with each other (5) Those contracted through mistake of one contracting party as
as husband and wife without the benefit of marriage or under a void to the identity of the other; and
marriage, their wages and salaries shall be owned by them in equal (6) Those subsequent marriages that are void under Article 53.
shares and the property acquired by both of them through their work
or industry shall be governed by the rules on co-ownership. (1) Below 18 – there is an absence of legal capacity
(2) Absence of authority of solemnizing officer
In the absence of proof to the contrary, properties acquired while they  GR: Marriage is solemnized by any person NOT LEGALLY
lived together shall be presumed to have been obtained by their joint AUTHORIZED to perform marriages. -- VOID
efforts, work or industry, and shall be owned by them in equal shares.  EXC: Either OR both parties believed in good faith that the
For purposes of this Article, a party who did not participate in the solemnizing officer had the legal authority to do so.
acquisition by the other party of any property shall be deemed to have o Good faith must be based on mistake of FACT.
contributed jointly in the acquisition thereof if the former’s efforts  Although a consul has no authority to solemnize mixed marriages,
consisted in the care and maintenance of the family and of the it shall be valid since marriages validly celebrated abroad are also
household. recognized in the Philippines. Article 35(2) is not exception.
Neither party can encumber or dispose by acts inter vivos of his or (3) Absence of marriage license
her share in the property acquired during cohabitation and owned in  Celebrated without a marriage license AND
common, without the consent of the other, until after the termination  Not exempt from requirement of marriage license.
of their cohabitation.
(4) Bigamous or polygamous marriages
When only one of the parties to a void marriage is in good faith, the  GR: A marriage contracted DURING the subsistence of a previous
share of the party in bad faith in the co-ownership shall be forfeited marriage.
in favor of their common children. In case of default of or waiver by o The marriage must be PERFECTLY VALID or VOIDABLE.
any or all of the common children or their descendants, each vacant o This is to distinguish it from the bigamous marriage in Article
share shall belong to the respective surviving descendants. In the 40 where the previous marriage must be truly VAI but a
absence of descendants, such share shall belong to the innocent subsequent marriage is contracted in the absence of a
party. In all cases, the forfeiture shall take place upon termination of judicial declaration of the nullity of the previous void
the cohabitation. . marriage.
 EXC: The subsequent marriage in Article 41 is perfectly valid when
ARTICLE 148, FC. The following shall be the exclusive property of all 3 requisites are present before the celebration of the
each spouse: subsequent marriage:
(1) That which is brought to the marriage as his or her own; o The prior spouse had been absent for
(2) That which each acquires, during the marriage, by lucrative title;  4 consecutive years OR
(3) That which is acquired by right of redemption or by exchange  2 consecutive years where there is danger of death
with other property belonging to only one of the spouses; under the circumstances in Article 391, NCC.
(4) That which is purchased with exclusive money of the wife or of o The spouse present had a well-founded belief that the
the husband. absence spouse was already dead; and
o The spouse present obtained a judicial declaration of
(e) Effect on donation property Nuptias presumptive death. (Armas v. Calisterio)
(1) GR: if the marriage is judicially declared void, the donation
propter nuptias remains VALID but the donor may revoke ARTICLE 391, NCC. The following shall be presumed dead for all
the same. purposes, including the division of the estate among the heirs: otiteo
(2) EXC: If the marriage is declared void by reason of Article 40 (1) A person on board a vessel lost during a sea voyage, or an
and the donee contracted the marriage in bad faith, the aeroplane which is missing, who has not been heard of for four
donation properter nuptias is revoked by operation of law. years since the loss of the vessel or aeroplane;
(3) If the marriage is void because both the parties to the (2) A person in the armed forces who has taken part in war, and
subsequent marriage in Article 41 acted in bad faith, all has been missing for four years;
donation properter nuptias by one in favor of the other are (3) A person who has been in danger of death under other
revoked by operation of law. circumstances and his existence has not been known for four
years.
3. Enumeration of Void Marriages under Family Code
(a) Void Marriages under Article 35

 BUT if the parties to the subsequent marriage ACTED IN BAD o Psychological incapacity is so enduring and persistent with
FAITH, said marriage is VAI for being bigamous under Article 35(4) respect to a specifc partner and contemplates where the
FC. couple’s respective personality structrues are so incompatible
and antagonistic.
ARTICLE 44, FC. If both spouses of the subsequent marriage acted  Juridical Antecedence – retained.
in bad faith, said marriage shall be void ab initio and all donations by
reason of marriage and testamentary dispositions made by one in Q. How does psychological incapacity affect their obligations to
favor of the other are revoked by operation of law. children?
 Their obligations to the children become part of their marital
(5) Void Marriage in Article 35(5): Where on contracted the obligations.
marriage through mistake as to the actual physical identity o If the manifestations are with regard to their obligations to the
of the other. children, there is still a ground for annulment.
(6) Void marriage under Article 53  It is possible that the marriage is attended by psychological
incapacity of one or both spouses, with the incapacity manifested
 Where a voidable marriage under Article 45 FC was already in ways that can be considered as grounds for legal separation.
annulled by final judgement, or a void marriage under Article 40
was already declared a nullity in a final judgment BUT Q. What is the property regime if void under Article 36?
o There NO LIQUIDATION, PARTITION, and DISTRIBUTION  The property regime would be under Article 147.
of the properties of the spouses or delivery of the presumptive  If under
legitimes of the common children; AND o 35 (1) – 148 – legal impediment
o There no recording of the judgment of annulment or of o 35 (2) – 147 – no legal impediment
absolute nullity of the marriage, the partition and distribution o 35 (3) – 147
of the properties, and the delivery of the children’s o 35 (4) – 148
presumptive legitimes in the appropriate civil registry and o 35 (5) – 147
registries of property. o 35 (6) – 148
o 36 – 147
(b) Void Marriage under Article 36 FC (Psychological Incapacity)
 psychological incapacity as a ground to nullify the same under
ARTICLE 36, FC. A marriage contracted by any party who, at the Article 36 FC should refer to the most serious cases of
time of the celebration, was psychologically incapacitated to personality disorders clearly demonstrative of an utter
comply with the essential marital obligations of marriage, shall insensitivity or inability to give meaning and significance to
likewise be void even if such incapacity becomes manifest only after the marriage.
its solemnization. (As amended by Executive Order 227)  It must be a malady that is so grave and permanent as to deprive
one of awareness of the duties and responsibilities of the
Concept matrimonial bond one is about to assume. (Elizcupidez v.
 psychological incapacity as “a personal condition that prevents a Elizcupidez)
spouse to comply with fundamental marital obligations only in  It contemplates incapacity or inability to take cognizance of and to
relation to a specific partner that may exist at the time of the assume basic marital obligations.
marriage but may have revealed through behavior subsequent to o NOT merely difficult, refusal, or neglect in the performance of
the ceremonies.” (Tan-Andal v. Andal) marital obligations, or ill will. (Yambao v. Republic)
Tan-Andal v. Andal
 Psychological incapacity is not a medical but a legal concept. Characteristics (3)
o It refers to a personal condition that prevents a spouse to  Gravity
comply with fundamental marital obligations only in o The incapacity must be grave or serious such that the party
relation to a specific party (Gravity) that may exist at the would be incapable of carrying out the ordinary duties required
time of the marriage but may have revealed through in marriage.
behavior subsequent to the ceremonies (Juridical o the concerned party was incapable of doing so, due to some
Antecedence). psychological illness existing at the time of the
 It need not be a mental or personality disorder. It need not be a celebration of the marriage.
permanent and incurable condition. o there must be proof of a natal or supervening disabling
o THUS the testimony of psychologist or psychiatrist is not factor in the person - an adverse integral element in the
mandatory in all cases. personality structure that effectively incapacitates the person
 Ordinary witnesses may testify. from really accepting and thereby complying with the
 There must be proof of the durable or enduring aspects of a obligations essential to marriage - which must be linked with
person’s personality, called “personality structure,” which the manifestations of the psychological incapacity
manifests itself through clear acts of dysfunctionality that  Juridical Antecedence
undermines the family. The spouse’s personality structure must o it must be rooted in the history of the party antedating the
make it impossible for him to her to understand and to comply with marriage, although the overt manifestations may emerge only
his or her essential marital obligations. after the marriage.
o Must be rooted in a medically or clinically identifiable grave
Q. What is the effect on the characteristics? illness that is incurable and shown to have existed at the time
 Gravity: It must be by reason of genuine, psychic causes. of marriage, although the manifestations may only be evident
o Personal predispositions. after the marriage.
 Incurable in the legal sense – incurable as to the partner.  Incurability
o Incurable, or even if it were otherwise, the cure would be
beyond the means of the party.
o Medically or clinically permanent or incurable. (9) Between parties where one, with the intention to marry the
o Incurability may be absolute or relative only in regards to the other, killed that other person’s spouse, or his or her own
other spouse, not necessarily absolutely against everyone of spouse.
the same sex.
(1) Between collateral blood relatives up to the 4th civil degree
No need for personal examination of respondent (2) Step-parents and step children (former)
 Marcos v. Marcos: There is no requirement, however, that the (3) Parents-in-law and children-in-law
respondent should be examined by a physician or a psychologist (4) Prohibited marriages by reason of adoption
as a conditio sine qua non for such declaration. (a) adopter cannot marry:
o What is important is the presence of evidence that can (i) Adopted
establish the condition. (ii) Surviving spouse of the adopted
o Totality of evidence must still prove the gravity, juridical (b) The adopted cannot marry:
antecedence, and incurability of the incapacity. (i) Adopter
(ii) Surviving spouse of the adopter
Illustrative Cases (iii) Legitimate child of adopter
 Republic v. Mola Cruz: respondent spouse was guilty of sexual (iv) Another adopted child of adopter
infidelity and abandonment, allowed her Japanese boyfriend to (c) The law does not prohibit a marriage between the
stay in the marital abode, shared the marital bed, and introduced adopted and an illegitimate child of the adopter.
her husband as her elder brother, under the threat of desertion. (5) Intentional killing of another spouse
o Her blatant insensitivity and lack of regard for the sanctity of (a) Where the spouse of another is intentionally killed to marry the
the marital bond and home is psychological incapacity. surviving spouse.
 Tani-Dela Fuente v. Dela Fuente Jr.: respondent’s repeated (b) Marriage is void even if the surviving spouse does not
psychological abuse by intimidating, stalking, and isolating his wife conspire in the killing
from family and friends (c) No prior criminal conviction needed because the guilt can be
 Antonio v. Reyes: respondent was a pathological liar, indicative of proven in the civil action for declaration of nullity.
her failure to distinguish truth from fiction, or abide by the truth.
o Person was unable to distinguish between fantasy and reality Q. Step-siblings got married in 1985. The first child was born in 1987. In
 Chi Ming Tsoi v. CA: husband was incapacitated because of his 1989 a second was conceived and was delivered in 1990. In 1993, the
continuous and unexplainable refusal to have sexual intercourse spouses were told that their marriage was null and void. They remarried
with the wife for an unreasonable length of time. in 1993. Are the two children legitimated.
No. Only the second child is legitimated. The first child is not legitimated
(c) Void Marriages under Article 37 (incestuous marriage) because there was a legal impediment to the marriage of his parents
when he was born. Before the FC (1988), marriage between step-
ARTICLE 37, FC. Marriages between the following are incestuous siblings are prohibited. Since the second child was conceived in 1989
and void from the beginning, whether relationship between the during the effectivity of the FC, he is legitimated. There is no impediment.
parties be legitimate or illegitimate:
(1) Between ascendants and descendants of any degree; and 4. Bigamous Marriage Under Article 40
(2) Between brothers and sisters, whether of the full or half blood.
ARTICLE 40, FC. The absolute nullity of a previous marriage may
(1) Between ascendants and descendants (of any degree, whether be invoked for purposes of remarriage on the basis solely of a final
legitimate or illegitimate) judgment declaring such previous marriage void.
(2) Between brothers and sisters
 Between stepsiblings – not prohibited under the FC, but Concept
prohibited under the NCC.  If the prior marriage is void but a party fails to secure a judicial
 Follow the law in force at the time of the celebration of declaration of nullity before contracting a subsequent marriage,
marriage. the latter is also void.
 Property regime: 148, legal impediment o Party is liable for bigamy.
(d) Void marriages under Article 38 (prohibited by reasons of Q. Is Article 40 a mere rule of procedure? NO. It can be a ground for
public policy) nullity of marriage.
 Is it a substantive law? YES
ARTICLE 38, FC. The following marriages shall be void from the  With the Pulido ruling, there is only 1 concept of bigamy. Article 40
beginning for reasons of public policy: is NO LONGER BIGAMOUS.
(1) Between collateral blood relatives whether legitimate or o If the prior marriage can be proven to be VAI, bigamy is not
illegitimate, up to the fourth civil degree; committed although the subsequent marriage is still VAI.
(2) Between step-parents and step-children; o Article 40 is different from Article 35(4).
(3) Between parents-in-law and children-in-law;
(4) Between the adopting parent and the adopted child; Distinguished from bigamous marriage under Article 35(4)
(5) Between the surviving spouse of the adopting parent and the Article 35(4) Article 40
adopted child; Prior marriage is valid or Prior marriage is void but a
(6) Between the surviving spouse of the adopted child and the voidable subsequent marriage is
adopter; contracted prior to a judicial
(7) Between an adopted child and a legitimate child of the adopter; declaration of absolute nullity
(8) Between adopted children of the same adopter; and Second marriage is void and Second marriage is void but not
bigamous bigamous.
Property regime of the void Property regime of the void (b) Subsequent marriage under the CC
marriage is provided in Article marriage is either ACP or CPG,
148 unless the parties provided for Requirements under the CC
complete separation of property. ARTICLE 83(2), NCC. Any marriage subsequently contracted by any
person during the lifetime of the first spouse of such person with any
 Article 40 will not apply if the marriage was celebrated before the person other than such first spouse shall be illegal and void from its
effectivity of the FC. performance, unless:
 It is only in Article 40 where the marriage settlement will govern (2) The first spouse had been absent for seven consecutive years
even if the marriage is void. at the time of the second marriage without the spouse present
o In other VAI marriages, the marriage settlements will not having news of the absentee being alive, or if the absentee, though
govern. 147/148 will govern. he has been absent for less than seven years, is generally
o Article 40 is the exception. considered as dead and believed to be so by the spouse present
at the time of contracting such subsequent marriage, or if the
Necessity of Judicial Declaration of Absolute Nullity absentee is presumed dead according to articles 390 and 391.
 Castillo v. De Leon-Castillo, Ty v. CA, Apiag v. Cantero: the The marriage so contracted shall be valid in any of the three cases
requirement of a judicial decree of nullity (Article 40 FC) does until declared null and void by a competent court.
not apply to marriages before the FC, particularly if the children
of the parties were born while the CC was in force. (Aug. 3, 1988) Spouse is authorized to remarry if ANY of the following is satisfied:
o This is regardless of the date of the first marriage.  Prior spouse has been absent for 7 consecutive years and
o If the second marriage is celebrated prior to the FC, no judicial spouse present has no news of the absentee being alive
decree is necessary. A void marriage is non-existent for all  Prior spouse has been absent for less than 7 years and generally
purposes including remarriage. (Art. 88 NCC) considered as dead and believed to be so by the spouse
 Q. If the marriage was contracted in 1985 without a valid marriage present; or
license. In 1990, A married C without a judicial declaration of the  Prior spouse disappeared in a situation where there is danger of
absolute nullity of the prior void marriage. The subsequent death under Article 391, CC and has been missing for 4 years.
marriage is void. The FC was already in effect.
o The important date is the celebration of the subsequent The CC does not require a judicial declaration of presumptive death
marriage. for the marriage to be valid as long as the prescribed period of absence
 Q. Can we apply Article 40 retroactively? NO. It’s not a procedural is met.
rule. It’s a substantive law. This will result in impairment of rights.
Without Article 40, the subsequent marriage is valid and the Status of subsequent marriage under CC
children of that marriage will be legitimate.  The subsequent marriage under Article 83(2) is not perfectly valid
o Borigo v. People: The first marriage was a private act of but voidable, or valid until declared null and void by court.
signing the marriage contract without an authorized  Ground for annulment: former spouse believed to be dead was
solemnizing officer. Article 40 does not apply because there’s in fact living and the marriage with such former spouse was in force.
no marriage to speak of. The remedy in the previous  Petition for annulment can be commenced by
marriage must be a petition for declaration of absolute nullity o the absentee spouse during his lifetime, or
of a void marriage. o either spouse of the subsequent marriage during the lifetime
o Prior marriage must be VAI, not VALID or VOIDABLE. That of the other.
will be covered by Article 35(4)  The subsequent marriage can only be terminated by a final
judgment of annulment.
5. Exception to Bigamy – Article 41, FC  The remedy of recording of affidavit of reappearance does not
apply
ARTICLE 41, FC. A marriage contracted by any person during o Applicable only for the purpose of terminating a subsequent
subsistence of a previous marriage shall be null and void, unless marriage validly contracted under the FC.
before the celebration of the subsequent marriage, the prior spouse
had been absent for four consecutive years and the spouse present (c) Subsequent marriage under the FC
has a well-founded belief that the absent spouse was already dead.
In case of disappearance where there is danger of death under the Requisites must be complied with prior to the celebration of the
circumstances set forth in the provisions of Article 391 of the Civil subsequent marriage. Otherwise, the marriage is void under Art. 35(1)
Code, an absence of only two years shall be sufficient.
Requirements under the FC (3)
For the purpose of contracting the subsequent marriage under the  Prior spouse had been absent for
preceding paragraph the spouse present must institute a summary o 4 consecutive years, or
proceeding as provided in this Code for the declaration of o 2 years where there is danger of death (Article 391
presumptive death of the absentee, without prejudice to the effect of NCC)
reappearance of the absent spouse.  Spouse present had a well-founded belief that the absent
spouse was already dead; AND
 GR: Bigamous marriage (under 35[4])  The spouse present obtained a judicial declaration of
 EXC: Absent spouse (3 requisites) presumptive death of the absentee spouse.
(a) Applicable law Status of subsequent marriage under FC

 Validity of a marriage and all its incidents are determined in  If all requisites are complied with before the celebration of the
accordance with the law in effect at the time of its celebration. subsequent marriage, the latter is perfectly valid under the FC.
 Otherwise, it’s void (bigamous)
Q. May the spouse present be the party in bad faith? NO. Because it will
Remedy if Subsequent marriage is void be a void marriage. Article 43 will not apply because it only applies in
 File a petition for the declaration of its nullity valid marriages. The spouse who contracted the marriage in bad faith
o Aggrieved spouse in the prior action has the personality to file can only be the present spouse.
such petition if the ground is bigamy.
 If the subsequent marriage is void, the remedy of recording of (1) Children are legitimate
affidavit of reappearance is inapplicable because said remedy (2) If the property regime is ACP or CPG, the same shall be dissolved
applies only if the subsequent marriage is perfectly valid. and liquidated.
o The affidavit of reappearance is filed only to terminate the (3) If the second spouse contracted the marriage in bad faith:
second marriage. If the subsequent marriage is VAI, there’s (a) His share in the net profits shall be forfeited in favor of the
nothing to terminate. common children, or if there are none, the children of the
o Santos v. Santos: The first two requisites were missing. There second spouse by a previous marriage, or in default of
was only a declaration of presumptive debt which was children, the spouse present.
obtained by fraud. CA said the property remedy of the (b) The donation propter nuptias made to him is revoked by
aggrieved spouse was to file an affidavit of reappearance. SC operation of law
said that said affidavit is not applicable if the subsequent (c) His designation as beneficiary in any insurance policy of the
marriage is VAI. It must be valid. spouse present may be revoked, even if the designation is
 Does the aggrieved spouse in the prior marriage have irrevocable
the personality to file the petition to declare nullity on the (d) He is disqualified to inherit from the spouse present,
ground of bigamy? YES. whether succession is testate or intestate.
(4) If the subsequent marriage is terminated by the death of the spouse
Requirement of judicial declaration of presumptive death present, the fact that the second spouse contracted the marriage
 Two applicable laws on presumption of death in bad faith is of no consequence.
o Article 41 FC is applicable if the presumption of death is for
the purpose of contracting another marriage. Q. If the marriage is terminated, and there is no marriage, why is the
 Under Article 41, judicial declaration of presumptive second spouse still disqualified from intestate succession?
death is required.  In one scenario in intestate succession, if the spouses are related
o Article 390 or 391 NCC applies if the presumption of death is within the 5th degree (only 4th degree is prohibited). This is the only
for purposes other than remarriage. situation where the disqualification from intestate succession
 Under case law, courts cannot take cognizance of a applies.
petition that on seeks to have a person declared
presumptively dead under the CC. Effect of bad faith on parties
 If the spouse present contracted the marriage in good faith
Remedy if subsequent marriage is valid (well-founded belief that the absentee spouse is already dead), the
(1) Recording of the affidavit of reappearance; OR subsequent marriage is perfectly valid if the requisites of Article
(2) Judicial declaration of dissolution or termination of the 41 are complied with
subsequent marriage. o Even if the second spouse contracted the marriage in bad
 Absentee’s mere appearance, even if made known to the spouses faith.
in the subsequent marriage, will not terminate the marriage by  If the spouse present was in bad faith, the marriage is void for
itself. being bigamous
o Even if the second spouse was in good faith
Effects of termination of valid subsequent marriage mentioned  If both parties were in bad faith, the subsequent marriage is
above VAI.
ARTICLE 43, FC. The termination of the subsequent marriage o All donations propter nuptias and testamentary dispositions
referred to in the preceding Article shall produce the following effects: are revoked by operation of law (Article 44, FC)
(1) The children of the subsequent marriage conceived prior to its  If the second spouse is in bad faith, his share in the net profits shall
termination shall be considered legitimate; be forfeited.
(2) The absolute community of property or the conjugal partnership,
as the case may be, shall be dissolved and liquidated, but if Article 41 FC Article 82(2) NCC
either spouse contracted said marriage in bad faith, his or her  Prior spouse had been  Prior spouse has been
share of the net profits of the community property or conjugal absent for absent for 7 consecutive
partnership property shall be forfeited in favor of the common o 4 consecutive years, years and spouse present
children or, if there are none, the children of the guilty spouse or has no news of the
by a previous marriage or in default of children, the innocent o 2 years where there absentee being alive
spouse; is danger of death  Prior spouse has been
(3) Donations by reason of marriage shall remain valid, except that (Article 391 NCC) absent for less than 7 years
if the donee contracted the marriage in bad faith, such donations  Spouse present had a well- and generally considered
made to said donee are revoked by operation of law; founded belief that the as dead and believed to
(4) The innocent spouse may revoke the designation of the other absent spouse was already be so by the spouse
spouse who acted in bad faith as beneficiary in any insurance dead; AND present; or
policy, even if such designation be stipulated as irrevocable;  The spouse present  Prior spouse disappeared
and obtained a judicial in a situation where there is
(5) The spouse who contracted the subsequent marriage in bad declaration of danger of death under
faith shall be disqualified to inherit from the innocent spouse by presumptive death of the Article 391, CC and has
testate and intestate succession. absentee spouse. been missing for 4 years.
Affidavit of reappearance is not (4) That the consent of either party was obtained by force,
applicable to subsequent intimidation or undue influence, unless the same having
marriages. disappeared or ceased, such party thereafter freely cohabited
with the other as husband and wife;
The only way to terminate the (5) That either party was physically incapable of consummating the
subsequent voidable marriage is marriage with the other, and such incapacity continues and
a final judgment of annulment. appears to be incurable; or
Ground for annulment is (6) That either party was afflicted with a sexually-transmissible
reappearance. Any of the 3 disease found to be serious and appears to be incurable.
parties may file the petition for
annulment during the lifetime of
the three. ARTICLE 47, FC. The action for annulment of marriage must be filed
by the following persons and within the periods indicated herein:
H. Voidable Marriages (1) For causes mentioned in number 1 of Article 45 by the party
whose parent or guardian did not give his or her consent, within
1. Concept and Characteristics of Voidable Marriages five years after attaining the age of twenty-one, or by the parent
or guardian or person having legal charge of the minor, at any
(a) Nature of voidable marriage time before such party has reached the age of twenty-one;
Considered valid until it is set aside by final judgment of a competent (2) For causes mentioned in number 2 of Article 45, by the same
court in an action for annulment. spouse, who had no knowledge of the other’s insanity; or by any
relative or guardian or person having legal charge of the insane,
 It cannot be subject to a collateral attack. at any time before the death of either party, or by the insane
 It may only be questioned during the lifetime of both spouses. spouse during a lucid interval or after regaining sanity;
 Prescriptive Periods (3) For causes mentioned in number 3 of Article 45, by the injured
o 5-year prescriptive period in the law party, within five years after the discovery of the fraud;
o Lifetime of the spouses (4) For causes mentioned in number 4 of Article 45, by the injured
party, within five years from the time the force, intimidation or
(b) Distinguished from void marriages undue influence disappeared or ceased;
Voidable Void (5) For causes mentioned in number 5 and 6 of Article 45, by the
Marriage is invalidated only by a Invalid from the beginning. injured party, within five years after the marriage.
judgment of annulment The judgment of the court is
simply confirmatory of its status. (1) Lack of Parental Consent
Can be ratified by free Can never be ratified.  When required?
o Only when a party is at least 18 but below 21.
cohabitation (except for Article
45[5] & [6])  Whose consent is required?
Can be assailed only in a direct Can be attacked collaterally o If the party below 21 is legitimate:
proceeding for that purpose  Father, mother, surviving parent or guardian, or persons
(petition for annulment) and not having legal charge of them, in the order mentioned.
collaterally (Article 14, FC)
o If the party is illegitimate:
Can be assailed only during the Can be questioned even after
lifetime of the parties death  Only the mother. (Article 176 FC)
 Who can file the petition for annulment?
The action prescribes. The action or defense for nullity
o If the party is still below 21:
is imprescriptible
 Only the parent whose consent is required
Only parties to a voidable Any proper interested party
o If the party reaches 21
marriage can assail it may assail
 Only the party himself (Article 47, FC)
 What is the prescriptive period?
2. Grounds for Annulment (6)
o 5 years from attainment of 21
These grounds are exclusive.  How is the defect ratified?
o Only by the party himself may ratify the defect upon reaching
ARTICLE 45, FC. A marriage may be annulled for any of the
21 by choosing to freely cohabit with the other party.
following causes, existing at the time of the marriage:
o Regardless of how short the cohabitation is
(1) That the party in whose behalf it is sought to have the marriage
annulled was eighteen years of age or over but below twenty-
(2) Unsoundness of mind at time of marriage
one, and the marriage was solemnized without the consent of
the parents, guardian or person having substitute parental  Who can file the petition for annulment?
authority over the party, in that order, unless after attaining the o Sane spouse only if he had no knowledge of the other’s
age of twenty-one, such party freely cohabited with the other insanity; OR
o Any relative, guardian, or person having legal charge of
and both lived together as husband and wife;
(2) That either party was of unsound mind, unless such party after the insane spouse;
o The insane spouse during a lucid interval or after regaining
coming to reason, freely cohabited with the other as husband
and wife; sanity.
(3) That the consent of either party was obtained by fraud, unless  What is the prescriptive period?
such party afterwards, with full knowledge of the facts o Lifetime of the spouses
constituting the fraud, freely cohabited with the other as  How is the defect ratified?
husband and wife; o Only the insane spouse can ratify upon coming to reason by
choosing to freely cohabit with the sane spouse.
(3) Fraud (6) Serious and incurable sexually transmitted disease

 What constitutes fraud? (4)  What is the ground?
ARTICLE 46, FC. Any of the following circumstances shall constitute o Existence of STD at the time of the marriage, which appears
fraud referred to in Number 3 of the preceding Article: to be serious and incurable.
(1) Non-disclosure of a previous conviction by final judgment  Who can file the petition for annulment and what is the
of the other party of a crime involving moral turpitude; prescriptive period?
(2) Concealment by the wife of the fact that at the time of the o Only the injured party, or the other spouse who had no
marriage, she was pregnant by a man other than her knowledge of the other’s STD at the time of the marriage.
husband; o 5 years from the date of celebration of marriage
(3) Concealment of sexually transmissible disease, regardless of  Not subject to ratification
its nature, existing at the time of the marriage; or
(4) Concealment of drug addiction, habitual alcoholism or 3. Effects of Annulment
homosexuality or lesbianism existing at the time of the
marriage. (1) Right to remarry
 Former spouses may validly contract another marriage
No other misrepresentation or deceit as to character, health, rank, o Only upon liquidation of the ACP or CPG, partition and
fortune or chastity shall constitute such fraud as will give grounds for distribution of properties of the erstwhile spouse (Article 50,
action for the annulment of marriage. FC), delivery of presumptive legitimes (Article 51 FC), and
compliance with Article 52 FC
 Who can file the petition for annulment and what is the (2) Effect on surname of former wife
prescriptive period?  If the wife is the guilty party, she shall resume her maiden name
o Only the injured party may file the petition and surname.
o Within 5 years after the discovery of the fraud  If she is the innocent spouse, she may:
 How is the defect ratified? o Resume her maiden name and surname
o Only the injured party can ratify by freely cohabiting with the o Choose to continue employing her former husband’s surname
other as husband and wife, with the full knowledge of the UNLESS
facts constituting the fraud.  The court decrees otherwise; or
 She or her former husband remarry to other persons
(4) Vitiation of consent (Article 371, NCC)
 Who can file the petition for annulment and what is the (3) Status of children
prescriptive period?  Children conceived or born before the judgment of annulment has
o Only the injured party can file become final or executory shall be considered legitimate (Art. 54
o Within 5 years from the time the force, intimidation, or undue FC)
influence disappeared or ceased (4) Effect on property relations
 Property regime of a voidable marriage prior to its annulment is
Q. Beadle impregnates X. X threatens to report him to the bar confidante either ACP, CPG, or complete separation.
to prevent him from taking the bar if he does not marry her. Will a case o If ACP or CPG, the same is automatically terminated upon
for annulment prosper? NO. The threat must be UNLAWFUL. If the the finality of the judgment of annulment and should be
threat is to enforce one’s valid legal claim, that will not annul consent. subjected to liquidation.
(5) Effect on donation propter nuptias
 How is the defect ratified?  Donation propter nuptias remains valid.
o Only the injured party can ratify  If the donee acted in bad faith, the donor may revoke the same
o By cohabiting with the other as husband and wife after the (Art. 86[3])
force, intimidation, or undue influence has disappeared or
ceased. I. Legal Separation
(5) Impotency 1. Effects of Decree of Legal Separation

 What is the ground for annulment?
o If one party was physically incapable of consummating the ARTICLE 63, FC. The decree of legal separation shall have the
marriage, if such incapacity continues and appears to be following effects:
incurable. (1) The spouses shall be entitled to live separately from each
o Not sterility other, but the marriage bonds shall not be severed;
 Who can file the petition for annulment and what is the (2) The absolute community or the conjugal partnership shall
prescriptive period? be dissolved and liquidated but the offending spouse shall
o Only the injured party, or the other spouse who had no have no right to any share of the net profits earned by the
knowledge of the other’s impotency at the time of the marriage absolute community or the conjugal partnership, which shall be
o Within 5 years after the marriage. forfeited in accordance with the provisions of Article 43(2);
 Not subject to ratification. (3) The custody of the minor children shall be awarded to the
 Q. Does this apply to women? YES innocent spouse, subject to the provisions of Article 213 of this
 What if the impotence is psychologically caused? The marriage Code; and
may still be annulled. (4) The offending spouse shall be disqualified from inheriting
 No ratification from the innocent spouse by intestate succession.
 Q. If they’re both impotent, is there an injured party? Is the marriage Moreover, provisions in favor of the offending spouse made
voidable? NO. There must be an injured party.
in the will of the innocent spouse shall be revoked by insurance beneficiary shall take effect upon written notification
operation of law. thereof to the insured.
(a) Right to Live Separately The action to revoke the donation under this Article must be
 A decree in legal separation does not result in the severance of the brought within five years from the time the decree of legal
marital bond but will only entitle the spouses to live separately. (Art. separation become final.
63[1])  GR: Donation propter nuptias remains valid.
 Husband no longer has the right of consortium.  EXC: If donee is the offending spouse, the innocent spouse may
revoke the donation within 5 years from the finality of the decree
(b) Effect on Property Relations of separation. (Art. 64, FC)
 If ACP or CPG: automatically terminated (Art. 99[2], 126[2]. 63[2],  If the donor is a third person, the donor may also revoke pursuant
FC) and shall be subject to liquidation. to Article 86(4), FC.
 The share of the offending spouse in the ‘net profits’ shall be
forfeited in favor of: (CC-CG-IS) (g) Effect on designation as beneficiary in insurance
o Common children  If the offending spouse is the beneficiary in any insurance policy
o In default thereof, children of the guilty spouse by a previous of the innocent spouse, such designation may be revoked, even if
marriage; or the designation be stipulated as irrevocable. (Art. 64, FC)
o In default thereof, the innocent spouse. (63[2] in relation to
43[2]) 2. Grounds for Legal Separation
 Assets are not forfeited. Only net profits. (Siochi v. Gozon)
 Complete separation after. ARTICLE 65, FC. A petition for legal separation may be filed on any
of the following grounds:
(c) Effect on right to Inherit (1) Repeated physical violence or grossly abusive conduct
 Right of the innocent spouse to inherit from the offending spouse directed against the petitioner, a common child, or a child of the
is not affected. petitioner;
 Offending spouse shall be disqualified to inherit from the (2) Physical violence or moral pressure to compel the petitioner
innocent spouse. to change religious or political affiliation;
o As to testamentary succession, testamentary dispositions in (3) Attempt of respondent to corrupt or induce the petitioner, a
favor of the offending spouse at the time of the finality of the common child, or a child of the petitioner, to engage in
decree of the legal separation shall be revoked by operation prostitution, or connivance in such corruption or
of law. inducement;
o BUT the offending spouse is NOT disqualified from being (4) Final judgment sentencing the respondent to imprisonment of
made a voluntary HDL in the will of the innocent spouse more than six years, even if pardoned;
executed after the issuance of the decree of legal (5) Drug addiction or habitual alcoholism of the respondent;
separation. (6) Lesbianism or homosexuality of the respondent;
(7) Contracting by the respondent of a subsequent bigamous
(d) Effect on Custody of Minor Children marriage, whether in the Philippines or abroad;
 GR: Custody of minor children shall be awarded to the innocent (8) Sexual infidelity or perversion;
spouse. (9) Attempt by the respondent against the life of the petitioner;
 EXC: Children below 7 should not be separated from the mother or
unless the court finds compelling reasons. (10) Abandonment of petitioner by respondent without justifiable
o RA 9262 (VAWC) prohibits the awarding of custody of minor cause for more than one year.
children to the perpetrator of a woman who is suffering
from battered woman syndrome. (Sec. 28) For purposes of this Article, the term “child” shall include a child by
o The victim who is suffering from battered wife syndrome shall nature or by adoption.
not be disqualified from having custody.
(a) Physical violence
(e) Effect on Right to Support  GR: There must be repetitive acts of physical violence directed
 GR: After the finality of the decree of legal separation, the obligation against petitioner, a common child, or a child of petitioner.
of mutual support ceases. (Art. 198, FC)  EXC: A single act of physical violence directed against the petition
 EXC: Court may order the guilty spouse to give support to the is a sufficient ground if
innocent spouse. o the same amounts to an attempt against the life of the
petitioner, or
(f) Effect on donation property nuptias o for the purpose of compelling the petitioner to change
ARTICLE 64, FC. After the finality of the decree of legal separation, religious or political affiliation.
the innocent spouse may revoke the donations made by him or
by her in favor of the offending spouse, as well as the (b) Other forms of abuse
designation of the latter as beneficiary in any insurance policy,  Other forms of abuse may be a ground IF:
even if such designation be stipulated as irrevocable. The revocation o The same is gross; AND
of the donations shall be recorded in the registries of property in the o It becomes a conduct of the respondent.
places where the properties are located. Alienations, liens and  A single exertion of moral pressure is sufficient ground
encumbrances registered in good faith before the recording of the o if it is for the purpose of compelling the petitioner to change
complaint for revocation in the registries of property shall be religious or political affiliation.
respected. The revocation of or change in the designation of the o If it is in the form of an attempt of respondent to corrupt or
induce the petitioner, a common child, or a child of the
petitioner, to engage in prostitution, or connivance in such (1) Where the aggrieved party has condoned the offense or act
corruption or inducement. complained of;
(2) Where the aggrieved party has consented to the commission
(c) Conviction of crime of the offense or act complained of;
 Requisites: (3) Where there is connivance between the parties in the
o Final judgment commission of the offense or act constituting the ground for
o Sentence imposed is imprisonment of more than 6 years, legal separation;
even if pardoned. (4) Where both parties have given ground for legal separation;
(5) Where there is collusion between the parties to obtain decree
(d) Drug addiction, habitual alcoholism, lesbianism, or of legal separation; or
homosexuality (6) Where the action is barred by prescription.
(e) Contracting of bigamous Marriage (a) Condonation and Consent

 The mere contracting of a subsequent bigamous marriage, whether  The act is unilateral on the part of the spouse.
in the PH or abroad, is a sufficient ground.  Condonation: the pardon is granted after the commission of the
 The intention is that even if the respondent cannot be offense.
prosecuted criminally for bigamy (because the crime was  Consent: approval is given prior to the commission of the offense.
committed abroad), the contracting of a subsequent marriage is a
ground of separation. (b) Connivance and collusion
o Even if the respondent is not criminally liable because of  Spouse both participated.
the lack of a marriage license in the subsequent marriage,  Connivance: the ground is really committed.
there is still a ground for legal separation.  Collusion: the ground may not have been really committed
Pulido v. People o Spouses made it appear as though it was committed for the
 Article 40 did not alter the RPC on bigamy (Article 349). purpose of obtaining a decree of legal separation.
o Bigamy can only be committed if the marriage is perfectly valid
or voidable. A void marriage was a defense. (c) Mutual guilt or recrimination
o Mercado v. Tan, Marvella v. Bobis changed this.  Both parties have given ground for legal separation.
(f) Sexual infidelity or perversion (d) Prescription

 Need not be committed with the opposite sex.  Five years from occurrence of the cause.
 As long as the sexual act is committed with someone other than
the spouse. (e) Effect of Death
 If a party dies prior to the entry of judgment, the case shall be
(g) Abandonment terminated.
 Requisites  If a party dies after the entry of judgment, the judgment shall bind
o Abandonment is without justifiable cause; AND the parties and their successors-in-interest.
o For more than one year.
5. Effect of Reconciliation
3. Cooling-off Period
ARTICLE 58, FC. An action for legal separation shall in no case be (a) If de facto reconciliation
tried before six months shall have elapsed since the filing of the  In the absence of a “decree of reconciliation,” the decree of legal
petition. separation is not set aside.
ARTICLE 59, FC. No legal separation may be decreed unless the (b) If there is decree of reconciliation
Court has taken steps toward the reconciliation of the spouses and  Decree of legal separation is set aside.
is fully satisfied, despite such efforts, that reconciliation is highly  The separation of property and any forfeiture of net profits shall
improbable. subsist.
 As a consequence:
 GR: The case shall not be tried on the merits within 6 months from o The right of the guilty spouse to inherit from the innocent
the filing of the petition. (Art. 58, FC) spouse in intestate succession shall be automatically
o The cooling off period does not prevent the court from hearing reinstated.
a motion for preliminary injunction to prevent the respondent o The testamentary dispositions in the will of the innocent
from managing the exclusive property of the petitioner spouse favorable to the guilty spouse which have been
(Somosa-Ramos v. Vamenta) revoked by operation of law shall be automatically
 EXC: IF the ground is violence (RA 9262), no cooling off period revived.
(Sec. 19) o If the donation propter nuptias made by the innocent spouse
 The courts must take steps toward the reconciliation of the spouses in favor of the guilty spouse has not yet been revoked, the
and may only issue the decree of legal separation after it has been former loses the right to revoke the donation.
satisfied that reconciliation is highly improbable. (Art. 59, FC) o BUT: If the revocation of the donation propter nuptias has
been decreed by the court and the judgment is already final,
4. Defenses in Legal Separation said judgment is already res judicata.
o If the innocent spouse has not yet revoked the
ARTICLE 56, FC. The petition for legal separation shall be denied designation of the guilty spouse as beneficiary in any
on any of the following grounds: insurance policy, the former loses the right to revoke the
same.
ARTICLE 71. The management of the household shall be the right

(c) Revival of previous property regime and the duty of both spouses. The expenses for such management
shall be paid in accordance with the provisions of Article 70.
(1) Agreement for revival of previous property regime
ARTICLE 72. When one of the spouses neglects his or her duties to
ARTICLE 67, FC. The agreement to revive the former property the conjugal union or commits acts which tend to bring danger,
regime referred to in the preceding Article shall be executed under dishonor or injury to the other or to the family, the aggrieved party
oath and shall specify: may apply to the court for relief.
(1) The properties to be contributed anew to the restored regime;
(2) Those to be retained as separated properties of each spouse; (a) Obligation to live together
and  GR: They are obliged to live together, but the court is powerless to
(3) The names of all their known creditors, their addresses and the enforce this obligation.
amounts owing to each. o BUT if a spouse leaves the conjugal dwelling without just
cause and demands legal support, the other spouse has the
The agreement of revival and the motion for its approval shall be filed option of giving support by receiving and maintaining him or
with the court in the same proceeding for legal separation, with her in the family dwelling (Article 204, FC) and if he/she
copies of both furnished to the creditors named therein. After due refuses, the right to receive legal support terminates (Atilano
hearing, the court shall, in its order, take measure to protect the v. Chua Ching Beng)
interest of creditors and such order shall be recorded in the proper  EXC: Court may exempt a spouse from living with the other if:
registries of properties. o The other should live abroad; and
o If there is a valid and compelling reason.
The recording of the ordering in the registries of property shall not  EXC to the EXC: Exception will not apply if the same is not
prejudice any creditor not listed or not notified, unless the debtor- compatible with the solidarity of the family.
spouse has sufficient separate properties to satisfy the creditor’s
claim. (b) Obligation to observe mutual love, respect, and fidelity
 Court is powerless to enforce this obligation
 Upon reconciliation and issuance of a decree of reconciliation, the  BUT there are sanctions for non-observance.
previous regime of the spouses is not automatically revived. o Criminal prosecution for adultery, concubinage, bigamy
 To revive it:
o Execute an agreement of revival under oath (c) Obligation to render mutual help and support
o Agreement must specify the properties to be contributed  GR: They are obliged to provide legal support to each other (Article
anew to the restored regime and those to be retained as 195[1], FC) and such obligation is chargeable to the absolute
separate properties community (Art. 94[1], FC) or to the conjugal partnership (Article
o Names of the creditors, addresses, and amounts owing to 121[1], FC).
each  EXC
o Agreement must be submitted in court for approval by way of o After the final judgment granting legal separation, the
a verified motion for its approval. obligation of mutual support between the spouses ceases.
 o BUT the court may order the guilty spouse to support the
(2) Adoption of new property regime innocent one. (Art. 198, FC)
 The FC does not allow adoption of a new property regime upon 
reconciliation. (d) Right of wife on use of husband’s surname
J. Rights and Obligations of Spouses ARTICLE 370, NCC. A married woman may use:
(1) Her maiden first name and surname and add her husband’s
1. Rights and Obligations surname, or
(2) Her maiden first name and her husband’s surname, or
FC. (3) Her husband’s full name, but prefixing a word indicating that she
ARTICLE 68. The husband and wife are obliged to live together, is his wife, such as “Mrs.”
observe mutual love, respect and fidelity, and render mutual help and
support. (109a)  RULE: A married woman may retain her maiden name after
marriage.
ARTICLE 69. The husband and wife shall fix the family domicile. In o “May” in Article 370 NCC: use of husband’s surname is
case of disagreement, the court shall decide. permissive
o When a woman marries, she does not change her name but
The court may exempt one spouse from living with the other if the only her civil status. (Remo v. Hon. Sec. of Foreign Affairs,
latter should live abroad or there are other valid and compelling In Re Uy-Timosa)
reasons for the exemption. However, such exemption shall not apply  Wife’s Options
if the same is not compatible with the solidarity of the family. o Maiden first name and surname and add her husband’s
surname
ARTICLE 70. The spouses are jointly responsible for the support of o Maiden first name and husband’s surname
the family. The expenses for such support and other conjugal o Husband’s full name, but prefixing a word indicating that she
obligations shall be paid from the community property and, in the is his wife (Mrs.)
absence thereof, from the income or fruits of their separate
 Effect of husband’s death:
properties. In case of insufficiency or absence of said income or
ARTICLE 373, NCC. A widow may use the deceased husband’s
fruits, such obligations shall be satisfied from the separate properties.
surname as though he were still living, in accordance with article 370.
 Widow has an option of

o Resuming her maiden name and surname; OR ARTICLE 80, FC. In the absence of a contrary stipulation in a
o Continue employing the deceased’s surname marriage settlement, the property relations of the spouses shall
 Permissive be governed by Philippine laws, regardless of the place of the
 Upon termination of the marriage, by reason of death, divorce, or celebration of the marriage and their residence.
annulment, the woman is not required to seek judicial
confirmation of the change in her civil status to revert to her This rule shall not apply:
maiden name. (Yasin v. Honorable Judge Sharia District Court) (1) Where both spouses are aliens;
(2) With respect to the extrinsic validity of contracts affecting
2. Choice of Domicile property not situated in the Philippines and executed in the
country where the property is located; and
(a) GR: the right to choose the family domicile belongs to both the (3) With respect to the extrinsic validity of contracts entered into in
husband and wife. the Philippines but affecting property situated in a foreign
(1) In case of disagreement: court decides country whose laws require different formalities for its extrinsic
(b) EXC: Court may exempt one spouse from living with the other if: validity.
(1) The other should live abroad; or
(2) If there is a valid and compelling reason. For Filipino spouses
 GR: PH laws govern their property relations, regardless of place of
Once the court exempts one of the spouses, the latter shall not lose celebration of marriage and their residence.
the right to demand legal support.  EXC: Properties Outside the PH: law of the country where the
 UNLESS: not compatible with the solidarity of the family property is situated, whether the issue is the extrinsic or intrinsic
validity of contracts affecting said property.
3. Exercise of profession, business, or activity
For Alien Spouses
ARTICLE 73, FC. Either spouse may exercise any legitimate  National law applies. (Orion Savings Bank v. Suzuki)
profession, occupation, business or activity without the
consent of the other. The latter may object only on valid, serious, (b) ACP, CPG, and complete separation
and moral grounds.  GR: The foregoing property regimes are applicable only to valid
and voidable marriages. They do not apply to void marriages.
In case of disagreement, the court shall decide whether or not:  EXC: the property regime of a void marriage under Article 40 FC,
(1) The objection is proper, and prior to judicial declaration of its absolute nullity, is either ACP,
(2) Benefit has accrued to the family prior to the objection or CPG, or complete separation. (Dino v. Dino, Valdes v. RTC)
thereafter. If the benefit accrued prior to the objection, the
resulting obligation shall be enforced against the community (c) Property regime of valid, voidable, and void marriages under
property. If the benefit accrued thereafter, such obligation shall Article 40
be enforced against the separate property of the spouse who
has not obtained consent. ARTICLE 74, FC. The property relationship between husband and
wife shall be governed in the following order:
The foregoing provisions shall not prejudice the rights of creditors (1) By marriage settlements executed before the marriage;
who acted in good faith. (2) By the provisions of this Code; and
(3) By the local custom.
(a) RULE: Either spouse may exercise any legitimate profession,
occupation, business, or activity without the consent of the other. ARTICLE 75, FC. The future spouses may, in the marriage
 RA 9262: if the husband prevents his wife from engaging in any settlements, agree upon the regime of absolute community, conjugal
legitimate profession, etc, he has committed an act of violence partnership of gains, complete separation of property, or any other
o EXC: husband objects on valid, serious, and moral regime. In the absence of a marriage settlement, or when the regime
grounds. (Sec. 3(a)(D)(1)) agreed upon is void, the system of absolute community of property
as established in this Code shall govern.
(b) Liability for obligations incurred in case of objection
 If the objection is proper, liability shall be governed by the following  Their property regime shall be that provided in the marriage
rules: settlement
o If the benefit accrued to the family prior to the objection, the o Which can be ACP, CPG, or complete separation.
resulting obligation is chargeable to the absolute community  In the absence of a marriage settlement, or when the marriage
or the conjugal partnership. settlement is void:
o If the benefit accrued thereafter, such obligation shall be o ACP if the marriage was celebrated during the FC
enforced against the separate property of the spouse who o CPG if during the NCC
has not obtained consent o Pana v. Heirs of Jose Juanite, Sr.: Article 256 FC does not
o No benefit accrued to the family: obligation shall be enforced intend to reach back and automatically convert into ACP all
against the separate property of the spouse who has not conjugal partnerships before the FC, excepting only those
obtained consent. with prenuptial agreements.
K. Property Relations in General (d) Property regime under Article 147 or Article 148
 GR: Applicable to:
1. In General o Void marriages, regardless of the cause
(a) Law governing property relations

o Union or cohabitation of a man and a woman without the o If one of the future spouses is below 21, the parents whose
benefit of marriage. consent to the marriage is required must be made a party to
 EXC: the property regime of a void marriage under Article 40 is the marriage settlement
either ACP or CPG, unless the parties agree to a complete  Otherwise, not valid.
separation of property in a marriage settlement entered into before o If one of the future spouses is suffering from civil interdiction
the marriage. (Dino v. Dino) or any other disability, the guardian appointed by a
competent court must also be made a party.
2. Marriage Settlement  Otherwise, not valid.
ARTICLE 76, FC. In order that any modification in the marriage (c) Effect of non-celebration of marriage
settlements may be valid, it must be made before the celebration of  GR: The marriage settlement becomes void, including donations
the marriage, subject to the provisions of Articles 66, 67, 128, 135 propter nuptias made therein.
and 136.  EXC: Stipulations that do not depend upon the celebration of the
marriage shall be valid.
ARTICLE 77, FC. The marriage settlements and any modification
thereof shall be in writing, signed by the parties and executed before 3. Donation Propter Nuptias
the celebration of the marriage. They shall not prejudice third persons
unless they are registered in the local civil registry where the ARTICLE 82, FC. Donations by reason of marriage are those which
marriage contract is recorded as well as in the proper registries of are made before its celebration, in consideration of the same,
properties. and in favor of one or both of the future spouses.
Marriage settlement will NOT govern in a void marriage. ARTICLE 83, FC. These donations are governed by the rules on
 147/148 if void ordinary donations established in Title III of Book III of the Civil
o EXC: If void by reason of Article 40 FC Code, insofar as they are not modified by the following articles.
 No marriage settlement if no marriage
ARTICLE 84, FC. If the future spouses agree upon a regime other
(a) Execution and modifications than the absolute community of property, they cannot donate to
(1) When made or executed: Before the celebration of the each other in their marriage settlements more than one-fifth of
marriage their present property. Any excess shall be considered void.
(2) Purpose: to fix the property relations during the marriage
(Article 1, FC) Donations of future property shall be governed by the provisions on
(3) Formalities testamentary succession and the formalities of wills.
 In writing ARTICLE 85, FC. Donations by reason of marriage of property

o Otherwise, it is unenforceable pursuant to the statute of subject to encumbrances shall be valid. In case of foreclosure of
Frauds (Art. 1403[2][c] NCC) the encumbrance and the property is sold for less than the total
o To be enforceable against third persons, it must be registered amount of the obligation secured, the donee shall not be liable for
in the local civil registry where the marriage contract is the deficiency. If the property is sold for more than the total amount
recorded as well as in the registries of property. of said obligation, the donee shall be entitled to the excess.
(b) Parties to marriage settlement (a) Concept
ARTICLE 78, FC. A minor who according to law may contract Requisites
marriage may also execute his or her marriage settlements, but they  Made before the celebration of the marriage
shall be valid only if the persons designated in Article 14 to give  Made in consideration of the marriage
consent to the marriage are made parties to the agreement, subject  The donation is in favor of one or both of the future spouses.
to the provisions of Title IX of this Code. Although the donor may be someone other than the spouses. This is
important if the donation propter nuptias will involve future property
ARTICLE 79, FC. For the validity of any marriage settlement
executed by a person upon whom a sentence of civil interdiction What can be donated?
has been pronounced or who is subject to any other disability, it  Whether the donor is one of the future spouses or a third person,
shall be indispensable for the guardian appointed by a competent both may donate present property.
court to be made a party thereto.  If the donation involves future property – only when it is a donation
between future spouses. (Art. 84 FC)
ARTICLE 81, FC. Everything stipulated in the settlements or o If made by a third person, the donation is void.
contracts referred to in the preceding articles in consideration of a
future marriage, including donations between the prospective (b) Formalities Required
spouses made therein, shall be rendered void if the marriage does Donation inter vivos – involves present property
not take place. However, stipulations that do not depend upon  Must comply with the formalities in ordinary donations. (748, 749)
the celebration of the marriages shall be valid. o Personal properties – if the value exceeds P5K, both the
donation and the acceptance must be in writing; otherwise,
 GR: only future spouses the donation is void.
 EXC: o Real property – the donation and acceptance must be in a
public instrument; otherwise, the donation is void.
Donation of future property – the same is in the nature of a policy, even if such designation be stipulated as irrevocable;
testamentary disposition, which must be in the form of a last will and and
testament. (5) The spouse who contracted the subsequent marriage in bad
faith shall be disqualified to inherit from the innocent spouse by
(c) Limitations in Donation of Present Property between Future testate and intestate succession.
Spouses 
 If regime agreed upon is ACP, there is no limitation on the extent ARTICLE 44, FC. If both spouses of the subsequent marriage
of the donation by the future spouses to each other. (Art. 84 FC) acted in bad faith, said marriage shall be void ab initio and all
 If other than ACP, they cannot donate more than 1/5 of their donations by reason of marriage and testamentary dispositions made
present property. by one in favor of the other are revoked by operation of law.
o Only the excess shall be void.
ARTICLE 50, FC. The effects provided for by paragraphs (2), (3), (4)
(d) Grounds for Revocation of Donation Propter Nuptias and (5) of Article 43 and by Article 44 shall also apply in the proper
cases to marriages which are declared ab initio or annulled by final
ARTICLE 86, FC. A donation by reason of marriage may be revoked judgment under Articles 40 and 45.
by the donor in the following cases:
(1) If the marriage is not celebrated or judicially declared void The final judgment in such cases shall provide for the liquidation,
ab initio except donations made in the marriage settlements, partition and distribution of the properties of the spouses, the custody
which shall be governed by Article 81; and support of the common children, and the delivery of third
(2) When the marriage takes place without the consent of the presumptive legitimes, unless such matters had been adjudicated in
parents or guardian, as required by law; previous judicial proceedings.
(3) When the marriage is annulled, and the donee acted in bad
faith; All creditors of the spouses as well as of the absolute community or
(4) Upon legal separation, the donee being the guilty spouse; the conjugal partnership shall be notified of the proceedings for
(5) If it is with a resolutory condition and the condition is complied liquidation.
with;
(6) When the donee has committed an act of ingratitude as In the partition, the conjugal dwelling and the lot on which it is
specified by the provisions of the Civil Code on donations in situated, shall be adjudicated in accordance with the provisions of
general. Articles 102 and 129.
(1) Non-celebration of marriage (3) Marriage is annulled

 GR: If the marriage is not celebrated, the donation is revocable.  If the marriage is annulled and the done acted in bad faith, the
 EXC: donation is made in the marriage settlement; donation donation becomes revocable.
becomes void.  If the ground is lack of parental consent, the donation becomes
revocable even if the marriage is not yet annulled.
(2) Marriage is judicially declared void
 GR: Donation becomes void. (4) Issuance of decree of legal separation
 EXC:
o If the marriage is judicially declared void under Article 40 ARTICLE 64, FC. After the finality of the decree of legal separation,
and the done contracted the marriage in bad faith, the the innocent spouse may revoke the donations made by him or by
donation is revoked by operation of law. (Article 40, in her in favor of the offending spouse, as well as the designation of the
relation to Article 43[3] FC) latter as beneficiary in any insurance policy, even if such designation
o If the subsequent marriage referred to in Article 41 is void be stipulated as irrevocable. The revocation of the donations shall be
because both parties acted in bad faith, all donation propter recorded in the registries of property in the places where the
nuptias made by one in favor of the other are revoked by properties are located. Alienations, liens and encumbrances
operation of law. registered in good faith before the recording of the complaint for
revocation in the registries of property shall be respected.
ARTICLE 43, FC. The termination of the subsequent marriage
referred to in the preceding Article shall produce the following effects: The revocation of or change in the designation of the insurance
(1) The children of the subsequent marriage conceived prior to its beneficiary shall take effect upon written notification thereof to the
termination shall be considered legitimate; insured.
(2) The absolute community of property or the conjugal partnership,
as the case may be, shall be dissolved and liquidated, but if The action to revoke the donation under this Article must be brought
either spouse contracted said marriage in bad faith, his or her within five years from the time the decree of legal separation become
share of the net profits of the community property or conjugal final.
partnership property shall be forfeited in favor of the common
children or, if there are none, the children of the guilty spouse  Donation becomes revocable if the done is the guilty spouse.
by a previous marriage or in default of children, the innocent
spouse; (5) Other grounds
(3) Donations by reason of marriage shall remain valid, except  If it is with a resolutory condition and the condition is complied with;
that if the donee contracted the marriage in bad faith, such  When the donee has committed an act of ingratitude as specified
donations made to said donee are revoked by operation of law; in Article 765 NCC.
(4) The innocent spouse may revoke the designation of the other
spouse who acted in bad faith as beneficiary in any insurance ARTICLE 765, NCC. The donation may also be revoked at the
instance of the donor, by reason of ingratitude in the following cases:
(1) If the donee should commit some offense against the person,  Spouses place in a common fund the proceeds, products, fruits,
the honor or the property of the donor, or of his wife or children and income from their separate properties and those acquired by
under his parental authority; either or both spouses through their efforts or by chance.
(2) If the donee imputes to the donor any criminal offense, or any (Homeowners Savings v. Dailo)
act involving moral turpitude, even though he should prove it,  Provisions on partnership shall apply suppletorily. (Article 108 FC)
unless the crime or the act has been committed against the ARTICLE 108, FC. The conjugal partnership shall be governed by
donee himself, his wife or children under his authority; the rules on the contract of partnership in all that is not in conflict with
(3) If he unduly refuses him support when the donee is legally or what is expressly determined in this Chapter or by the spouses in
morally bound to give support to the donor. their marriage settlements.
4. Donations Between Marriage During Marriage (b) Commencement

ARTICLE 88, FC. The absolute community of property between
ARTICLE 87, FC. Every donation or grant of gratuitous spouses shall commence at the precise moment that the
advantage, direct or indirect, between the spouses during the marriage is celebrated. Any stipulation, express or implied, for the
marriage shall be void, except moderate gifts which the spouses commencement of the community regime at any other time shall be
may give each other on the occasion of any family rejoicing. The void.
prohibition shall also apply to persons living together as husband and
wife without a valid marriage. ARTICLE 107, FC. The rules provided in Articles 88 and 89 shall also
apply to conjugal partnership of gains.
(a) GR: Every donation between the spouses during marriage,  ACP and CPG commence at the precise moment that the marriage
whether made directly or indirectly, shall be void regardless of the is celebrated.
property regime. o Any stipulation to the contrary shall be void.
 Also applies to persons merely living together as husband and wife
without a valid marriage. (c) Prohibition against waiver
(b) EXC: Moderate gifts on the occasion of any family rejoicing are ARTICLE 89, FC. No waiver of rights, shares and effects of the
valid. absolute community of property during the marriage can be
made except in case of judicial separation of property.
PROPERTY REGIMES
 ACP / CPG / CS When the waiver takes place upon a judicial separation of property,
o Perfectly valid or after the marriage has been dissolved or annulled, the same shall
o Voidable appear in a public instrument and shall be recorded as provided in
o Void under Article 40 Article 77. The creditors of the spouse who made such waiver may
 147 / 148 petition the court to rescind the waiver to the extent of the amount
o Void sufficient to cover the amount of their credits.
 EXC: Article 40 FC
 ACP / CPG / CS ARTICLE 107, FC. The rules provided in Articles 88 and 89 shall also
 If celebrated without a marriage settlement or with apply to conjugal partnership of gains.
a void settlement – ACP  Prior to the liquidation of the ACP or CPG, the law prohibits the
 If there was a marriage settlement before the waiver of rights, interests, shares, and effects of the property
celebration of the void marriage – marriage regime.
settlement shall govern o REASON: Prior to liquidation, the interest of each spouse in
o Union of man and woman as husband and wife without the the conjugal assets or community property is inchoate and
benefit of a marriage does not ripen into title until it appears that there are assets
 147 / 148 left as a result of the liquidation. (Abalos v. Macatangay, Jr.)
o 147 – If the ground is NOT absence of legal capacity
o 148 – 35(1, 4) 37, 38 – lack of capacity 2. Properties Included in ACP and CPG and Exclusive
Properties
L. Absolute Community and Conjugal Partnership of Gains
(a) In Absolute community
1. Basic Concepts
ARTICLE 91, FC. Unless otherwise provided in this Chapter or in the
(a) Concept marriage settlements, the community property shall consist of all the
property owned by the spouses at the time of the celebration of
[1] Absolute Community of Property the marriage or acquired thereafter.
 A special kind of co-ownership.
 Spouses become joint owners of all the properties of the marriage. ARTICLE 92, FC. The following shall be excluded from the
(Quiao v. Quiao) community property:
 Provisions on co-ownership shall apply suppletorily. (Article 90 FC) (1) Property acquired during the marriage by gratuitous title by
ARTICLE 90, FC. The provisions on co-ownership shall apply to the either spouse, and the fruits as well as the income thereof, if
absolute community of property between the spouses in all matters any, unless it is expressly provided by the donor, testator or
not provided for in this Chapter. grantor that they shall form part of the community property;
(2) Property for personal and exclusive use of either spouse.
[2] Conjugal Partnership of Gains However, jewelry shall form part of the community property;
 Special type of partnership
(3) Property acquired before the marriage by either spouse who  EXC: it is proven that
has legitimate descendants by a former marriage, and the o Acquired by gratuitous title
fruits as well as the income, if any, of such property. o acquired by right of redemption, by barter or by exchange with
property belonging to only one of the spouses
Art. 93. Property acquired during the marriage is presumed to belong o purchased with exclusive money of the wife or of the husband.
to the community, unless it is proved that it is one of those excluded  Presumption in favor of conjugal partnership applies even if the
therefrom. acquisition appears to have been made in favor of one or both
 Community Property: Generally, all the property owned by the spouses. The registration of a property alone in the name of one
spouses at the time of the celebration of marriage and acquired spouse does not destroy its conjugal nature. (Tarrosa v. De Leon)
thereafter. It is not conclusive evidence of exclusive ownership.
 Exclusive Property:  Presumption only applies when there is proof that the property
o Excluded from the community property in the marriage was acquired during the marriage (Imani v. MBTC)
settlements o Not applicable when no showing as to when property was
o Acquired before marriage by either spouse who has acquired. (Cuenca v. Cuenca)
legitimate descendants by a former marriage, including the
fruits and income Special Rule: – Article 120; Requisites for Applicability
o Acquired during the marriage by gratuitous title, unless the ARTICLE 120, FC. The ownership of improvements, whether for
grantor expressly declares they shall form part of the utility or adornment, made on the separate property of the
community property spouses at the expense of the partnership or through the acts or
o For personal and exclusive use efforts of either or both spouses shall pertain to the conjugal
 Jewelry forms part of the CP partnership, or to the original owner-spouse, subject to the following
rules:
(b) Conjugal partnership of gains
When the cost of the improvement made by the conjugal partnership
Conjugal property and exclusive and any resulting increase in value are more than the value of the
ARTICLE 109, FC. The following shall be the exclusive property of property at the time of the improvement, the entire property of one
each spouse: of the spouses shall belong to the conjugal partnership, subject to
(1) That which is brought to the marriage as his or her own; reimbursement of the value of the property of the owner-spouse at
(2) That which each acquires during the marriage by gratuitous the time of the improvement; otherwise, said property shall be
title; retained in ownership by the owner-spouse, likewise subject to
(3) That which is acquired by right of redemption, by barter or by reimbursement of the cost of the improvement.
exchange with property belonging to only one of the
spouses; and In either case, the ownership of the entire property shall be
(4) That which is purchased with exclusive money of the wife or vested upon the reimbursement, which shall be made at the time
of the husband. of the liquidation of the conjugal partnership.
ARTICLE 116, FC. All property acquired during the marriage, Requisites
whether the acquisition appears to have been made, contracted or  Property is exclusively owned by spouse
registered in the name of one or both spouses, is presumed to be  Subjected to improvements during marriage
conjugal unless the contrary is proved.  Improvements at the expense of the CPG or through the efforts
of either or both spouses
ARTICLE 117, FC. The following are conjugal partnership
properties: Rules for determination of ownership
(1) Those acquired by onerous title during the marriage at the  If the cost of improvement and any resulting increase in the value
expense of the common fund, whether the acquisition be for the of the property are more than the value of the property prior to
partnership, or for only one of the spouses; the improvement, the entire property shall become CPG property;
(2) Those obtained from the labor, industry, work or profession  Otherwise, entire property shall become exclusive property of the
of either or both of the spouses; owner spouse.
(3) The fruits, natural, industrial, or civil, due or received  In either case, there will be corresponding reimbursements at the
during the marriage from the common property, as well as liquidation of the CPG.
the net fruits from the exclusive property of each spouse;
(4) The share of either spouse in the hidden treasure which the Special Rule – Property Purchased on Installments (Article 118):
law awards to the finder or owner of the property where the Requisites
treasure is found; ARTICLE 118, FC. Property bought on installments paid partly from
(5) Those acquired through occupation such as fishing or hunting; exclusive funds of either or both spouses and partly from conjugal
(6) Livestock existing upon the dissolution of the partnership in funds belongs to the buyer or buyers if full ownership was vested
excess of the number of each kind brought to the marriage before the marriage and to the conjugal partnership if such ownership
by either spouse; and was vested during the marriage. In either case, any amount
(7) Those which are acquired by chance, such as winnings from advanced by the partnership or by either or both spouses shall be
gambling or betting. However, losses therefrom shall be borne reimbursed by the owner or owners upon liquidation of the
exclusively by the loser-spouse. partnership.
 Those brought to the marriage as his/her own shall remain Requisites

exclusive property.  Property bought by one of the spouses before marriage.
 GR: Properties acquired during marriage are presumed to be  Payable on installments
conjugal.
 Partly paid from exclusive funds of the buyer and partly from spouse, the payment of which shall be considered as advances
conjugal funds. to be deducted from the share of the debtor-spouse upon
liquidation of the community; and
Rules for Determination of Ownership (10) Expenses of litigation between the spouses unless the suit is
 Time when full ownership was vested found to be groundless.
 Before marriage – exclusive property of the buyer
 During marriage – conjugal property If the community property is insufficient to cover the foregoing
 Reimbursements shall be made during liquidation liabilities, except those falling under paragraph (9), the spouses shall
be solidarily liable for the unpaid balance with their separate
Special Rule: Credit Payable on Installments (Article 119) properties.
ARTICLE 119, FC. Whenever an amount or credit payable within a
period of time belongs to one of the spouses, the sums which may ARTICLE 121, FC. The conjugal partnership shall be liable for:
be collected during the marriage in partial payments or by (1) The support of the spouse, their common children, and the
installments on the principal shall be the exclusive property of the legitimate children of either spouse; however, the support of
spouse. However, interests falling due during the marriage on the illegitimate children shall be governed by the provisions of this
principal shall belong to the conjugal partnership. Code on Support;
(2) All debts and obligations contracted during the marriage by the
Requisites designated administrator-spouse for the benefit of the conjugal
partnership of gains, or by both spouses or by one of them with
 Credit belongs to a spouse
the consent of the other;
 Payable on installments
(3) Debts and obligations contracted by either spouse without the
 Sums are collected during the marriage
consent of the other to the extent that the family may have
benefited;
Rules for Determination of Owners
(4) All taxes, liens, charges, and expenses, including major or
 Payments on principal – exclusive
minor repairs upon the conjugal partnership property;
 Payments of interest falling due during the marriage – CPG (5) All taxes and expenses for mere preservation made during the
marriage upon the separate property of either spouse;
Special Rule: Livestock (6) Expenses to enable either spouse to commence or complete a
 Only excess of the number brought into the marriage shall be professional, vocational, or other activity for self-improvement;
conjugal property. (7) Ante-nuptial debts of either spouse insofar as they have
redounded to the benefit of the family;
3. Obligations of the Absolute Community or Conjugal (8) The value of what is donated or promised by both spouses in
Partnership favor of their common legitimate children for the exclusive
purpose of commencing or completing a professional or
ARTICLE 94, FC. The absolute community of property shall be vocational course or other activity for self-improvement; and
liable for: (9) Expenses of litigation between the spouses unless the suit is
(1) The support of the spouses, their common children, and found to groundless.
legitimate children of either spouse; however, the support of
illegitimate children shall be governed by the provisions of this If the conjugal partnership is insufficient to cover the foregoing
Code on Support; liabilities, the spouses shall be solidarily liable for the unpaid balance
(2) All debts and obligations contracted during the marriage by with their separate properties.
the designated administrator-spouse for the benefit of the
community, or by both spouses, or by one spouse with the *94(7) not included
consent of the other;
(3) Debts and obligations contracted by either spouse without the (a) Support:
consent of the other to the extent that the family may have
been benefited; [1] ACP liable for the support of
(4) All taxes, liens, charges and expenses, including major or  Spouses
minor repairs, upon the community property;
 Their common children
(5) All taxes and expenses for mere preservation made during
 Legitimate children of either spouse
marriage upon the separate property of either spouse used by
the family;
ARTICLE 197, FC. In case of legitimate ascendants; descendants,
(6) Expenses to enable either spouse to commence or complete a
whether legitimate or illegitimate; and brothers and sisters, whether
professional or vocational course, or other activity for self-
legitimately or illegitimately related, only the separate property of the
improvement;
person obliged to give support shall be answerable provided that in
(7) Ante-nuptial debts of either spouse insofar as they have
case the obligor has no separate property, the absolute community
redounded to the benefit of the family;
or the conjugal partnership, if financially capable, shall advance the
(8) The value of what is donated or promised by both spouses
support, which shall be deducted from the share of the spouse
in favor of their common legitimate children for the exclusive
obliged upon the liquidation of the absolute community or of the
purpose of commencing or completing a professional or
conjugal partnership.
vocational course or other activity for self-improvement;
(9) Ante-nuptial debts of either spouse other than those falling
ARTICLE 122, FC. The payment of personal debts contracted by
under paragraph (7) of this Article, the support of illegitimate
the husband or the wife before or during the marriage shall not be
children of either spouse, and liabilities incurred by either
charged to the conjugal properties partnership except insofar as
spouse by reason of a crime or a quasi-delict, in case of
they redounded to the benefit of the family.
absence or insufficiency of the exclusive property of the debtor-
(d) Taxes and expenses for repair

Neither shall the fines and pecuniary indemnities imposed upon them  All taxes, liens, charges, and expenses, including major and minor
be charged to the partnership. repairs upon the community or conjugal property – obligation of
ACP or CPG.
However, the payment of personal debts contracted by either spouse  Taxes on separate property
before the marriage, that of fines and indemnities imposed upon o Obligation of the CPG
them, as well as the support of illegitimate children of either spouse, o Obligation of the ACP when property is used by the family.
may be enforced against the partnership assets after the  Expenses for preservation of separate property
responsibilities enumerated in the preceding Article have been o Obligation of the CPG
covered, if the spouse who is bound should have no exclusive o ACP – only when used by the family
property or if it should be insufficient; but at the time of the liquidation
of the partnership, such spouse shall be charged for what has been (e) Civil liability for delict or quasi-delict
paid for the purpose above-mentioned.  GR: Paid by separate property
 EXC:
 Illegitimate children, legitimate ascendants, descendants o ACP: In case of absence or insufficiency of the exclusive
(legitimate/illegitimate excluding common children and legitimate property, ACP shall advance payment to be deducted from the
children), siblings, only the separate property of the obliged to give share of the debtor-spouse upon liquidation.
support shall be answerable. (Article 197 FC) o CPG: if obligor has no separate property, obligation may be
o If no separate property: ACP, if financially capable, shall enforced against the partnership assets after the obligations
advance support of the CPG in Article 121 have been covered.
 Deducted from the share of the spouse upon liquidation.
o If no separate property in CPG: obligation may be enforced (f) Other obligations of ACP or CPG
against the partnership assets, if financially capable, only  Expenses to enable either spouse to commence or complete a
after the obligations of the CPG in Article 121 FC have professional or vocational course, or other activity for self-
been covered. (Article 122 paragraph 3, in relation to Article improvement;
197, FC)  The value of what is donated or promised by both spouses in
favor of their common legitimate children for the exclusive purpose
(b) Antenuptial debts (debts contracted before marriage) of commencing or completing a professional or vocational course
 Obligation of the ACP or CPG if they have redounded to the or other activity for self-improvement;
benefit of the family. (Article 94[7], 121[7])  Expenses of litigation between the spouses unless the suit is
o Otherwise; paid by the separate property of the debtor- found to be groundless
spouse.
 ACP: In case of absence or insufficiency of the exclusive property, 4. Administration and Management of ACP or CPG
ACP shall advance payment to be deducted from the share of the
debtor-spouse upon liquidation. ARTICLE 96, FC. The administration and enjoyment of the
 CPG: if obligor has no separate property, obligation may be community property shall belong to both spouses jointly. In case
enforced against the partnership assets after the obligations of of disagreement, the husband’s decision shall prevail, subject to
the CPG in Article 121 have been covered. recourse to the court by the wife for proper remedy, which must
o Spouse shall be charged for what has been paid for that be availed of within five years from the date of the contract
purpose upon liquidation. implementing such decision.
(c) Debts contracted during marriage In the event that one spouse is incapacitated or otherwise unable
 Obligation of the ACP or CPG when to participate in the administration of the common properties, the
o Contracted by both spouses other spouse may assume sole powers of administration. These
o Contracted by one spouse with consent of the other powers do not include disposition or encumbrance without authority
o Contracted by the administrator for the benefit of the ACP or of the court or the written consent of the other spouse. In the
CPG absence of such authority or consent, the disposition or
o Contracted by either spouse without consent to the extent the encumbrance shall be void. However, the transaction shall be
family may have benefitted. construed as a continuing offer on the part of the consenting
 If it did not redound to the benefit of the family, it shall spouse and the third person, and may be perfected as a binding
be paid by separate property and ACP or CPG cannot contract upon the acceptance by the other spouse or authorization
be compelled to advance its payment even if the debtor- by the court before the offer is withdrawn by either or both offerors.
spouse has no separate property.
 Burden of proof that the debts was for the benefit of the ARTICLE 124, FC. The administration and enjoyment of the conjugal
ACP/CPG: creditor-party litigant partnership shall belong to both spouses jointly. In case of
 EXC: husband contracts the obligation on behalf of the disagreement, the husband’s decision shall prevail, subject to
family business and he himself is the principal obligation recourse to the court by the wife for proper remedy, which must be
in the contract and directly received the money and availed of within five years from the date of the contract implementing
services to be used in the business, the law presumes such decision.
that such obligation shall redound to the benefit of the
ACP/CPG (Ross v. PNB-Laoag Branch, SBTC v. Mar In the event that one spouse is incapacitated or otherwise unable to
Tierra Corp.; Ayala v. CA) participate in the administration of the conjugal properties, the other
 No presumption if the money or services are given to spouse may assume sole powers of administration. These powers
another person or entity, and the husband acted only as do not include disposition or encumbrance without authority of the
a surety or guarantor. (SBTC v. Mar Tierra Corp.) court or the written consent of the other spouse. In the absence of
such authority or consent, the disposition or encumbrance shall be conjugal partnership property. Should the wife fail to exercise this
void. However, the transaction shall be construed as a continuing right, she or her heirs, after the dissolution of the marriage, may
offer on the part of the consenting spouse and the third person, and demand the value of property fraudulently alienated by the
may be perfected as a binding contract upon the acceptance by the husband.
other spouse or authorization by the court before the offer is  Disposition of real property of the conjugal partnership by the
withdrawn by either or both offerors. husband without the wife’s consent is merely voidable.
o The wife could, during the marriage and within 10 years
(a) Rule: administration belongs to both spouses jointly. from the transaction, seek its annulment.
(b) In case of disagreement  Felipe v. Aldon: Wife sold some parcels of land belonging to the
 GR: Husband’s decision shall prevail and he can validly enter conjugal partnership without consent. If the sale of conjugal
into contracts without the consent of the wife. partnership property without consent took place before the FC, the
 EXC: sale is merely voidable and not VAI.
o Contract causes economic injury to the family  Ko v. Aramburo: husband sold a conjugal property in 1974 without
o Wife may seek rescission of the contract and other proper consent. The wife filed the action for annulment in 1993. SC
remedy within 5 years from the date of the contract declared the action to have been filed outside the 10-year
implementing the husband’s decision. prescriptive period.
o The contract in 147 is rescissible because there’s a
prescriptive period. (c) Void contract as continuing offer
(c) When sole administration allowed  The transaction shall be construed as a continuing offer on the part
 One spouse is incapacitated or unable to participate in the of the consenting spouse and the third person and may be
administration of the community or conjugal properties, the other perfected as a binding contract upon the acceptance by the
spouse may assume sole powers of administration. other spouse OR authorization by the court before the offer is
 Powers do not include: withdrawn by either or both the offerors. (Article 96 paragraph 2,
o Disposition or encumbrance without the authority of the court 123 paragraph 2 FC)
or written consent of the other spouse.  The transaction executed without the written consent of the other
spouse or the proper court order is VOID.
5. Disposition or Encumbrance of Community or Conjugal o HENCE: ratification does not occur. A void contract cannot
Property be ratified. (Aggabao v. Parulan)
 When the consent is given, there be a meeting of the offer and
ARTICLE 97, FC. Either spouse may dispose by will of his or her acceptance since the void transaction is still considered a
interest in the community property. continuing offer, resulting in the perfection of the contract.
ARTICLE 98, FC. Neither spouse may donate any community (d) Contract void in its entirety
property without the consent of the other. However, either spouse  If without written consent of the other spouse or authority of the
may, without the consent of the other, make moderate donations court.
from the community property for charity or on occasions of family  It cannot be treated as a valid transaction with respect to the
rejoicing or family distress. alleged share of the consenting spouse in the specific
property
ARTICLE 125, FC. Neither spouse may donate any conjugal o Such alleged share does not exist as yet.
partnership property without the consent of the other. However, either  Abalos v. Macatangay: In case of sale of conjugal property without
spouse may, without the consent of the other, make moderate the consent of the other spouse, the sale is still void even on the
donations from the conjugal partnership property for charity or on supposition that the spouses only disposed of their respective
occasions of family rejoicing or family distress. shares in the property because “the right of the husband or wife to
one-half of the conjugal assets does not vest until the dissolution
(a) Disposition or Encumbrance of Community or Conjugal and liquidation of the conjugal partnership, or after dissolution of
Property the marriage, when it is finally determined that, after settlement of
 RULE: Alienation, or encumbrance of community or conjugal conjugal obligations, there are net assets left which can be divided
property must have the written consent of the other spouse or between the spouses or their respective heirs.”
authority of the court.  EXCEPTIONAL SCENARIO
o Otherwise: VOID. While the property regime is not liquidated, o Carlos v. Tolentino: SC did not annul the entire disposition
there is no share. of a conjugal partnership property despite the absence of
 RULE: Neither spouse may donate any community or conjugal consent, because of the subsequent death of the
partnership property without the consent of the other transaction spouse.
o EXC:  Applying justice and equity, SC ruled that since the
 moderate donations for charity conjugal partnership was already terminated upon the
 occasions of family rejoicing or family distress death of the transacting spouse, there is no need to
 RULE: Either spouse may dispose by will his/her share in the invalidate the disposition of her ½ portion of the conjugal
community or conjugal property. property that will eventually be her share after the
termination of the conjugal partnership.
(b) Rule under Civil Code in Conjugal Partnership  NOTE: If there’s a legal way, you must MAINTAIN the
ARTICLE 173, NCC. The wife may, during the marriage, and within validity of the contract.
ten years from the transaction questioned, ask the courts for the
annulment of any contract of the husband entered into without (e) Buyer in good faith
her consent, when such consent is required, or any act or contract of  If the transaction is void (lack of consent, court order) the buyer
the husband which tends to defraud her or impair her interest in the may invoke the principle of buyer in good faith.
 If he will be able to prove that he observed two kinds of  Any disposition or encumbrance involving community or
requisite diligence: conjugal property of the terminated marriage shall be
o Diligence in verifying the validity of the title VOID.
o Diligence in inquiring into the authority of the transacting o Uy v. Estate of Vipa Fernandez: the sale by the surviving
spouse to sell conjugal or community property. (Bautista v. spouse despite the absence of liquidation is NOT necessarily
Silva, Ravina v. Villa Abrille, Aggabao v. Parulan) void.
 Under Article 493 NCC, the sale of his ½ undivided share
6. Dissolution / Termination of ACP or CPG in the property is not necessarily void. His right as a co-
owner was effectively transferred, making the buyer a
D-LS-AV-JS co-owner of the property.
ARTICLE 99, FC. The absolute community terminates:  If conjugal partnership was established in the CC
(1) Upon the death of either spouse; o If CPG is established BEFORE the FC and one of the
(2) When there is a decree of legal separation; spouses DIED before the FC: the mandatory obligation to
(3) When the marriage is annulled or declared void; or liquidate and the effects of failure to do so DO NOT APPLY.
(4) In case of judicial separation of property during the marriage  AGAIN: 103 and 130 ONLY APPLY DURING THE
under Articles 134 to 138. EFFECTIVITY OF THE FC
 If the death occurred during the FC?
 Void – only by reason of Article 40 FC o The CC does not require the surviving spouse to liquidate.
[6] Exceptional subsequent marriage in Article 41 FC – the ACP / CPG o As a consequence
can be terminated by the recording of the affidavit of reappearance of  A subsequent marriage, even during the FC, shall not
the absentee spouse be governed mandatorily by the regime of complete
separation
(a) Death  Any disposition or encumbrance of CPG shall not be
void.
ARTICLE 103, FC. Upon the termination of the marriage by death,  Follow the rules on co-ownership.
the community property shall be liquidated in the same  If governed by the FC
proceeding for the settlement of the estate of the deceased. o Subsequent marriage is governed be governed by CS
o Disposition / encumbrance = void
If no judicial settlement proceeding is instituted, the surviving  Is the entire transaction void? NO. Upon the death of one
spouse shall liquidate the community property either judicially of the spouses, the ACP / CPG was already terminated.
or extra-judicially within one year from the death of the deceased  All of the properties are under a state of co-ownership.
spouse. If upon the lapse of the said period, no liquidation is made, So when the surviving spouse sells his share, it’s only a
any disposition or encumbrance involving the community property sale of a concrete share of the co-ownership
of the terminated marriage shall be void.
(b) Decree of legal separation
Should the surviving spouse contract a subsequent marriage
without complying with the foregoing requirements, a mandatory ARTICLE 100, FC. The separation in fact between husband and
regime of complete separation of property shall govern the wife shall not affect the regime of absolute community except that:
property relations of the subsequent marriage. (1) The spouse who leaves the conjugal home or refuses to live
therein, without just cause, shall not have the right to be
ARTICLE 130, FC. Upon the termination of the marriage by death, supported;
the conjugal partnership property shall be liquidated in the same (2) When the consent of one spouse to any transaction of the other
proceeding for the settlement of the estate of the deceased. is required by law, judicial authorization shall be obtained in a
summary proceeding;
If no judicial settlement proceeding is instituted, the surviving (3) In the absence of sufficient community property, the separate
spouse shall liquidate the conjugal partnership property either property of both spouses shall be solidarily liable for the support
judicially or extra-judicially within six months from the death of of the family. The spouse present shall, upon proper petition in
the deceased spouse. If upon the lapse of the six-month period no a summary proceeding, be given judicial authority to administer
liquidation is made, any disposition or encumbrance involving the or encumber any specific separate property of the other spouse
conjugal partnership property of the terminated marriage shall be and use the fruits or proceeds thereof to satisfy the latter’s
void. share.
Should the surviving spouse contract a subsequent marriage without ARTICLE 127, FC. The separation in fact between husband and wife
compliance with the foregoing requirements, a mandatory regime of shall not affect the regime of conjugal partnership, except that:
complete separation of property shall govern the property relations of (1) The spouse who leaves the conjugal home or refuses to live
the subsequent marriage. therein, without just cause, shall not have the right to be
supported;
 Rules under the FC: (2) When the consent of one spouse to any transaction of the other
o There a mandatory obligation on the part of surviving spouse is required by law, judicial authorization shall be obtained in a
to liquidate the ACP or CPG, either judicially or summary proceeding;
extrajudicially, within 1 year from the death of the deceased (3) In the absence of sufficient conjugal partnership property, the
spouse. separate property of both spouses shall be solidarily liable for
o OTHERWISE the support of the family. The spouse present shall, upon
 The subsequent marriage shall be governed by a petition in a summary proceeding, be given judicial authority to
mandatory regime of complete separation of administer or encumber any specific separate property of the
property; AND
other spouse and use the fruits or proceeds thereof to satisfy (1) That the spouse of the petitioner has been sentenced to a
the latter’s share. penalty which carries with it civil interdiction;
(2) That the spouse of the petitioner has been judicially declared an
[1] Effects if there is a decree of legal separation absentee;
 ACP/CPG is automatically terminated. (3) That loss of parental authority of the spouse of petitioner has
 Upon liquidation of the ACP or CPG, the share of the offending been decreed by the court;
spouse in the “net profits” shall be forfeited in favor of: (4) That the spouse of the petitioner has abandoned the latter or
o Common children failed to comply with his or her obligations to the family as
o In default thereof, children of the guilty spouse by a previous provided for in Article 101;
marriage; or (5) That the spouse granted the power of administration in the
o In default thereof, the innocent spoise (Art. 63[2] in relation to marriage settlements has abused that power; and
43[2] FC) (6) That at the time of the petition, the spouses have been
 What is forfeited is only the NET PROFITS, not the NET ASSETS. separated in fact for at least one year and reconciliation is highly
 Property relations of the spouses shall be governed by a regime improbable.
of complete separation.
In the cases provided for in Numbers (1), (2) and (3), the presentation
[2] Effects of mere separation de facto of the final judgment against the guilty or absent spouse shall be
 Does not affect the regime of ACP or CPG. enough basis for the grant of the decree of judicial separation of
 Effects property.
o Spouse who leaves the conjugal home or refuses to live
therein, without just cause, shall have no right to be ARTICLE 136, FC. The spouses may jointly file a verified petition
supported with the court for the voluntary dissolution of the absolute community
o When the consent of one spouse to any transaction of the or the conjugal partnership of gains, and for the separation of their
other is required by law, judicial authorization shall be common properties.
obtained in a summary proceeding
o If the community property or conjugal partnership property is All creditors of the absolute community or of the conjugal partnership
not sufficient, the separate property of both spouses shall of gains, as well as the personal creditors of the spouse, shall be
be solidarily liable for the support of the family. listed in the petition and notified of the filing thereof. The court shall
 The spouse present shall, upon proper petition in a take measures to protect the creditors and other persons with
summary proceeding, be given judicial authority to pecuniary interest.
administer or encumber any specific property of the other
spouse and use the fruits or proceeds to satisfy the  Upon the judicial separation of property during the marriage, either
latter’s share. voluntarily or for cause, the ACP or CPG is TERMINATED.
o If a spouse without just cause abandons the other or fails to o BUT an extrajudicial dissolution of the CPG or ACP
comply with his obligations to the family, the aggrieved spouse without judicial approval is VOID. (Espinos v. Omana)
may petition for receivership, judicial separation of
property, or for authority to be sole administrator of the (e) Procedures for liquidation ACP or CPG
ACP or CPG.
 ABANDONMENT: A spouse is deemed to have abandoned the ARTICLE 102, FC. Upon dissolution of the absolute community
other when he has left the conjugal dwelling without any intention regime, the following procedure shall apply:
of returning. (1) An inventory shall be prepared, listing separately all the
o The spouse who has left the conjugal dwelling for 3 months or properties of the absolute community and the exclusive
has failed within the same period to give any information as to properties of each spouse.
his whereabouts shall be prima facie presumed to have no (2) The debts and obligations of the absolute community shall be
intention of returning to the conjugal dwelling. paid out of its assets. In case of insufficiency of said assets, the
spouses shall be solidarily liable for the unpaid balance with
(c) Finality of judgment of annulment or declaration of nullity their separate properties in accordance with the provisions of
 The property regime of a voidable marriage is either ACP, CPG, the second paragraph of Article 94.
or CS. (3) Whatever remains of the exclusive properties of the spouses
o If ACP or CPG: regime is terminated upon the finality of a shall thereafter be delivered to each of them.
judgment of annulment. (4) The net remainder of the properties of the absolute
 If the marriage is VOID, regardless of the cause, the property community shall constitute its net assets, which shall be
relations of the parties during the period of cohabitation are divided equally between husband and wife, unless a different
governed by Article 147 or 148, as the case may be. (Valdez v. proportion or division was agreed upon in the marriage
RTC, Buenaventura v. CA) settlements, or unless there has been a voluntary waiver of such
o GR: Ordinarily, there is no ACP or CPG in a void marriage. share provided in this Code. For purpose of computing the net
o EXC: Void under Article 40 FC. profits subject to forfeiture in accordance with Articles 43, No.
 Prior to judicial declaration of absolute nullity, the (2) and 63, No. (2), the said profits shall be the increase in
property regime is either ACP, CPG, or CS. value between the market value of the community property at
 Upon finality of judgment, the ACP or CPG is terminated. the time of the celebration of the marriage and the market value
at the time of its dissolution.
(d) Judicial separation of property (5) The presumptive legitimes of the common children shall be
ARTICLE 135, FC. Any of the following shall be considered sufficient delivered upon partition, in accordance with Article 51.
cause for judicial separation of property: (6) Unless otherwise agreed upon by the parties, in the partition of
the properties, the conjugal dwelling and the lot on which it
is situated shall be adjudicated to the spouse with whom
the majority of the common children choose to remain. (5) The net remainder of the properties shall constitute its net
Children below the age of seven years are deemed to have assets (in CPG, the net remainder shall constitute its net
chosen the mother, unless the court has decided otherwise. In profits), which shall be divided equally between them, unless
case there in no such majority, the court shall decide, taking into (a) a different proportion or division was agreed upon in the
consideration the best interests of said children. marriage settlements, or
(b) there has been a voluntary waiver of such share.
ARTICLE 129, FC. Upon the dissolution of the conjugal partnership  “Net assets” is different from “net profits”
regime, the following procedure shall apply: o Net profits: subject to forfeiture under Articles 43(2) and 63(2)
(1) An inventory shall be prepared, listing separately all the FC.
properties of the conjugal partnership and the exclusive  Refer to the increase in value between the market value
properties of each spouse. of the community property at the time of the celebration
(2) Amounts advanced by the conjugal partnership in payment of of the marriage and at the time of its dissolution.
personal debts and obligations of either spouse shall be o In ACP: net profits are computed based on the following:
credited to the conjugal partnership as an asset thereof.  Get the market value of the ACP at the time of the
(3) Each spouse shall be reimbursed for the use of his or her community’s dissolution
exclusive funds in the acquisition of property or for the value of  From the totality of the market value of the properties,
his or her exclusive property, the ownership of which has been subtract the debts and obligations of the ACP
vested by law in the conjugal partnership.  Result of the foregoing procedure shall be “net assets”
(4) The debts and obligations of the conjugal partnership shall be or net remainder of the properties of the absolute
paid out of the conjugal assets. In case of insufficiency of said community
assets, the spouses shall be solidarily liable for the unpaid  Deduct the market value of the properties at the time
balance with their separate properties, in accordance with the of marriage. The result is the “net profits.”
provisions of paragraph (2) of Article 121.  Delivery of presumptive legitimes of the common
(5) Whatever remains of the exclusive properties of the spouses children.
shall thereafter be delivered to each of them.  The conjugal dwelling, including the lot shall be
(6) Unless the owner had been indemnified from whatever source, adjudicated to the spouse with whom the majority of the
the loss or deterioration of movables used for the benefit of the common children choose to remain unless otherwise
family, belonging to either spouse, even due to fortuitous event, agreed upon the parties.
shall be paid to said spouse from the conjugal funds, if any.  In case there is no majority, the court shall decide.
(7) The net remainder of the conjugal partnership properties
shall constitute the profits, which shall be divided equally M. Separation of Property of Spouses During the Marriage
between husband and wife, unless a different proportion or
division was agreed upon in the marriage settlements or unless 1. In General
there has been a voluntary waiver or forfeiture of such share as
provided in this Code. ARTICLE 145, FC. Each spouse shall own, dispose of, possess,
(8) The presumptive legitimes of the common children shall be administer and enjoy his or her own separate estate, without
delivered upon the partition in accordance with Article 51. need of the consent of the other. To each spouse shall belong all
(9) In the partition of the properties, the conjugal dwelling and the earnings from his or her profession, business or industry and all fruits,
lot on which it is situated shall, unless otherwise agreed upon natural, industrial or civil, due or received during the marriage from
by the parties, be adjudicated to the spouse with whom the his or her separate property.
majority of the common children choose to remain. Children
below the age of seven years are deemed to have chosen the ARTICLE 146, FC. Both spouses shall bear the family expenses
mother, unless the court has decided otherwise. In case there in proportion to their income, or, in case of insufficiency or default
is no such majority, the court shall decide, taking into thereof, to the current market value of their separate properties.
consideration the best interests of said children.
The liabilities of the spouses to creditors for family expenses shall,
(1) Inventory however, be solidary.
 Listing separately the exclusive properties and the properties of the
ACP. (a) Concept
 Each spouse shall own, dispose of, possess, administer, and enjoy
(2) Amounts advanced by the ACP or CPG in payment of personal his own separate estate, without need of the consent of the other.
debts and obligations of either spouse shall be credited to the  To each spouse shall belong all earnings from his profession,
ACP/CPG as an asset. business, or industry and all fruits, natural, industrial, or civil, due
 CPG: each spouse shall be reimbursed for the use of his exclusive or received during the marriage from his separate property.
funds in the acquisition of property or for the value of his exclusive  As to expenses, both spouses shall bear the family expenses in
property, the ownership of which has been vested by law in the proportion to his income, or, in case of insufficiency or default, to
conjugal partnership. the current market value of their separate properties.
 The liability of the spouses to creditors for family expenses
(3) Payment of debts and obligations of the ACP/CPG out of its shall be solidary.
assets.
 In case of insufficiency: spouses shall be solidarily liable for the (b) Effect on SALN Requirement
unpaid balance with their separate properties.
 Abid-Babano v. Executive Secretary: The requirement under RA
(4) Whatever remains of the exclusive properties of the spouses 6713 and similar laws that the SALN to be filed by every
shall be delivered to them. government official shall include assets, liabilities, and net worth of
the spouse of the filer is construed NOT TO INCLUDE the assets,
liabilities, and net worth of spouses whose property regime is by (1) That the spouse of the petitioner has been sentenced to a
law or by agreement prior to the marriage one of COMPLETE penalty which carries with it civil interdiction;
SEPARATION. (2) That the spouse of the petitioner has been judicially declared an
o Evil sought to be prevented by our laws on SALN, that a absentee;
spouse would be used to conceal the full extent of a (3) That loss of parental authority of the spouse of petitioner has
government employee’s wealth and financial interests, does been decreed by the court;
not exist in this case. (4) That the spouse of the petitioner has abandoned the latter or
failed to comply with his or her obligations to the family as
2. When Complete Separation Governing provided for in Article 101;
(5) That the spouse granted the power of administration in the
(a) If provided in marriage settlements marriage settlements has abused that power; and
ARTICLE 74, FC. The property relationship between husband and (6) That at the time of the petition, the spouses have been
wife shall be governed in the following order: separated in fact for at least one year and reconciliation is highly
(1) By marriage settlements executed before the marriage; improbable.
(2) By the provisions of this Code; and
(3) By the local custom. In the cases provided for in Numbers (1), (2) and (3), the presentation
of the final judgment against the guilty or absent spouse shall be
ARTICLE 134, FC. In the absence of an express declaration in the enough basis for the grant of the decree of judicial separation of
marriage settlements, the separation of property between spouses property.
during the marriage shall not take place except by judicial order. Such
judicial separation of property may either be voluntary or for sufficient ARTICLE 136, FC. The spouses may jointly file a verified petition
cause. with the court for the voluntary dissolution of the absolute community
 If separation of property is agreed upon in the marriage or the conjugal partnership of gains, and for the separation of their
settlements, the spouses may no longer adopt ACP or CPG common properties.
during the marriage because they can only commence at the
precise moment of the celebration of the marriage. All creditors of the absolute community or of the conjugal partnership
 Separation may refer to present or future property or both. of gains, as well as the personal creditors of the spouse, shall be
 The separation may be total or partial. listed in the petition and notified of the filing thereof. The court shall
o Partial: properties not agreed upon as separate shall pertain take measures to protect the creditors and other persons with
to the ACP. pecuniary interest.
(b) Pursuant to judicial order  Upon issuance of a decree of legal separation

 Upon a joint petition of the spouses for voluntary separation
ARTICLE 63, FC. The decree of legal separation shall have the (or without need for a cause)
following effects:  Upon petition for judicial separation due to a sufficient cause.
(1) The spouses shall be entitled to live separately from each other,
but the marriage bonds shall not be severed; Sufficient causes for judicial separation of property:
(2) The absolute community or the conjugal partnership shall (1) That the spouse of the petitioner has been sentenced to a penalty
be dissolved and liquidated but the offending spouse shall which carries with it civil interdiction;
have no right to any share of the net profits earned by the (2) That the spouse of the petitioner has been judicially declared an
absolute community or the conjugal partnership, which shall be absentee;
forfeited in accordance with the provisions of Article 43(2); (3) That loss of parental authority of the spouse of petitioner has
(3) The custody of the minor children shall be awarded to the been decreed by the court;
innocent spouse, subject to the provisions of Article 213 of this (4) That the spouse of the petitioner has abandoned the latter or failed
Code; and to comply with his or her obligations to the family as provided for in
(4) The offending spouse shall be disqualified from inheriting from Article 101;
the innocent spouse by intestate succession. Moreover, (5) That the spouse granted the power of administration in the
provisions in favor of the offending spouse made in the will of marriage settlements has abused that power; and
the innocent spouse shall be revoked by operation of law. (6) That at the time of the petition, the spouses have been separated
in fact for at least one year and reconciliation is highly
ARTICLE 66, FC. The reconciliation referred to in the preceding improbable.
Articles shall have the following consequences:
(1) The legal separation proceedings, if still pending, shall thereby In (1) to (3):
be terminated at whatever stage; and  The presentation of the final judgment against the guilty or absent
(2) The final decree of legal separation shall be set aside, but the spouse shall be enough basis for the grant of the decree of judicial
separation of property and any forfeiture of the share of the separation of property.
guilty spouse already effected shall subsist, unless the
spouses agree to revive their former property regime. (c) Failure to liquidate
The court’s order containing the foregoing shall be recorded in the ARTICLE 103, FC. Upon the termination of the marriage by death,
proper civil registries. the community property shall be liquidated in the same proceeding
for the settlement of the estate of the deceased.
ARTICLE 135, FC. Any of the following shall be considered sufficient
cause for judicial separation of property: If no judicial settlement proceeding is instituted, the surviving spouse
shall liquidate the community property either judicially or extra-
judicially within one year from the death of the deceased spouse. If (2) If the judicial separation is for sufficient cause, the parties may file
upon the lapse of the said period, no liquidation is made, any a motion in the same proceeding for the revival of the previous
disposition or encumbrance involving the community property of the regime upon cessation of the ground which was the basis of the
terminated marriage shall be void. judicial order for separation.
(a) If judicial separation is for a sufficient cause, the spouses can
Should the surviving spouse contract a subsequent marriage again petition for judicial separation so long as there is a new
without complying with the foregoing requirements, a cause/ground.
mandatory regime of complete separation of property shall
govern the property relations of the subsequent marriage. (b) Procedure for Revival
The same procedure for the revival of the previous regime upon
ARTICLE 130, FC. Upon the termination of the marriage by death, reconciliation of the spouses after the issuance of the decree of legal
the conjugal partnership property shall be liquidated in the same separation shall be followed.
proceeding for the settlement of the estate of the deceased.
4. Transfer of Administration of Exclusive Property to Other
If no judicial settlement proceeding is instituted, the surviving spouse Spouse
shall liquidate the conjugal partnership property either judicially or
extra-judicially within six months from the death of the deceased (a) By Agreement
spouse. If upon the lapse of the six-month period no liquidation is ARTICLE 110, FC. The spouses retain the ownership, possession,
made, any disposition or encumbrance involving the conjugal administration and enjoyment of their exclusive properties.
partnership property of the terminated marriage shall be void.
Either spouse may, during the marriage, transfer the administration
Should the surviving spouse contract a subsequent marriage without of his or her exclusive property to the other by means of a public
compliance with the foregoing requirements, a mandatory regime of instrument, which shall be recorded in the registry of property of the
complete separation of property shall govern the property relations of place the property is located.
the subsequent marriage.
It may be done by means of a public instrument, which shall be
 If the ACP pr CPG of the previous marriage was terminated by recorded in the registry of property of the place where the property is
reason of death and the surviving spouse, who failed to liquidate located.
the ACP or CPG within 1 year from the death of the spouse,
contracted another marriage, the subsequent marriage shall be (b) Upon Order of Court
governed by a mandatory regime of complete separation. ARTICLE 142, FC. The administration of all classes of exclusive
property of either spouse may be transferred by the court to the other
3. Revival of Previous Property Regime spouse:
(1) When one spouse becomes the guardian of the other;
(a) Grounds for Revival (2) When one spouse is judicially declared an absentee;
ARTICLE 141, FC. The spouses may, in the same proceedings (3) When one spouse is sentenced to a penalty which carries with
where separation of property was decreed, file a motion in court for it civil interdiction; or
a decree reviving the property regime that existed between them (4) When one spouse becomes a fugitive from justice or is in
before the separation of property in any of the following instances: hiding as an accused in a criminal case.
(1) When the civil interdiction terminates; If the other spouse is not qualified by reason of incompetence,
(2) When the absentee spouse reappears; conflict of interest, or any other just cause, the court shall appoint
(3) When the court, being satisfied that the spouse granted the a suitable person to be the administrator.
power of administration in the marriage settlements will not
again abuse that power, authorizes the resumption of said (c) Automatic Termination of Administration
administration; ARTICLE 112, FC. The alienation of any exclusive property of a
(4) When the spouse who has left the conjugal home without a spouse administered by the other automatically terminates the
decree of legal separation resumes common life with the administration over such property and the proceeds of the
other; alienation shall be turned over to the owner-spouse.
(5) When parental authority is judicially restored to the spouse
previously deprived thereof; Common Provisions
(6) When the spouses who have separated in fact for at least one ACP / CPG
year, reconcile and resume common life; or Commencement Precise moment of the celebration of the
(7) When after voluntary dissolution of the absolute community of marriage – when the solemnizing officer
property or conjugal partnership has been judicially decreed recognizes that the spouses are marriage (by the
upon the joint petition of the spouses, they agree to the revival powers vested in me, etc)
of the former property regime. No voluntary separation of Waiver No waiver of share PRIOR to liquidation. Such
property may thereafter be granted. interest or share or right does not exist as yet
while the property is not yet liquidated.
The revival of the former property regime shall be governed by Article Administration
67.
N. Property Regimes Under Articles 147 and 148
(1) In case of voluntary judicial separation of property, the parties may
file a motion in the same proceeding for the revival of the previous 1. Applicability
property regime, even in the absence of a reason/ground. BUT no
voluntary separation may thereafter be granted. (a) In Void Marriages
 GR: In a void marriage, regardless of the cause, the property (2) Bigamous and polygamous marriages
relations during the period of cohabitation is governed by Article (3) Incestuous marriages (Article 37)
147 or 148 FC. (Valdes v. RTC, Dino v. Dino, Ocampo v. Ocampo, (4) Prohibited marriages for public policy reasons (Article 38)
Diaz-Salgado v. Anson) (5) Subsequent marriages contemplated in Article 41 FC where both
o There is no ACP or CPG in a void marriage (Carino v. Carino) parties acted in bad faith and declared void under Article 44
even during the period prior to declaration of nullity.
o Thus, the rules set up to govern the liquidation of ACP or CPG, (b) In Union of parties without the benefit of marriage
the property recognized for valid and voidable marriages, are  147 if two requisites are satisfied
irrelevant to the liquidation of the co-ownership between o Parties are capacitated to marry each other
common-law spouses or spouses of void marriages. o They live exclusively with each other as husband and wife.
o In the liquidation of the properties of parties to a void marriage,  Otherwise, 148 applies.
co-ownership under the Civil Code should apply, and such o Although the adulterous cohabitation of the parties
liquidation need not be made in the same proceeding for commenced before the effectivity of the FC, 148 applies
declaration of nullity of marriage. (Dino v. Dino) because this provision was intended to fill up the hiatus in
o The partition of the co-ownership in Article 147 may also be Article 144 NCC. (Tumlos v. Fernandez)
made by an agreement between the parties. o Even if the cohabitation or acquisition of the property occurred
 Diaz-Salgado v. Anson: since the property regime of the before the FC too effect, 148 governs.
parties is governed by Article 147, the properties
acquired during the cohabitation are presumed to be co- 3. Applicable Rules Under Article 147
owned. The provisions on co-ownership under CC shall
apply in the partition of the properties co-owned by the Just call these regimes as “Property Regime under 147/148”
parties. Under the NCC, partition may be made by ARTICLE 147, FC. When a man and a woman who are capacitated
agreement of the parties or by judicial proceedings. to marry each other, live exclusively with each other as husband and
 EXC: If the subsequent marriage is void under Article 40, the wife without the benefit of marriage or under a void marriage, their
property relations of the parties to the subsequent marriage may wages and salaries shall be owned by them in equal shares and the
either be ACP, CPG, unless the parties agree to CS in a marriage property acquired by both of them through their work or industry shall
settlement entered into before the marriage. be governed by the rules on co-ownership.
o Sec. 19(1) of A.M. No. 02-11-10-SC, which requires the
liquidation, partition, and distribution of properties prior to the In the absence of proof to the contrary, properties acquired while they
issuance of decree of nullity of the marriage applies only to a lived together shall be presumed to have been obtained by their joint
void marriage under Article 40 FC when said rule mentions of efforts, work or industry, and shall be owned by them in equal shares.
“decree of absolute nullity” and not to a marriage declared by For purposes of this Article, a party who did not participate in the
reason of psychological incapacity under Article 36 FC. acquisition by the other party of any property shall be deemed to have
 In the latter case, since the applicable property regime is contributed jointly in the acquisition thereof if the former’s efforts
that provided in Article 147 FC, the declaration of nullity consisted in the care and maintenance of the family and of the
can already be made even without waiting for the household.
liquidation of the properties of the parties because it is
not necessary to liquidate the properties of the spouses Neither party can encumber or dispose by acts inter vivos of his or
in the same proceeding for declaration of nullity of her share in the property acquired during cohabitation and owned in
marriage. common, without the consent of the other, until after the termination
of their cohabitation.
(b) In Union of Parties without the Benefit of Marriage
 If the man and woman simply lived together as husband and When only one of the parties to a void marriage is in good faith, the
wife without the benefit of marriage, they are governed by the share of the party in bad faith in the co-ownership shall be forfeited
property regime provided for in Article 147 or 148. in favor of their common children. In case of default of or waiver by
o These property regimes do not apply to same-sex any or all of the common children or their descendants, each vacant
cohabitation. This is governed by the law on property. share shall belong to the respective surviving descendants. In the
absence of descendants, such share shall belong to the innocent
2. When Governed by Article 147 or Article 148 party. In all cases, the forfeiture shall take place upon termination of
the cohabitation. .
(a) In Void Marriages
Article 147 applies to “union of parties who are legally capacitated and (a) On salary and wages
not barred by any impediment to contract marriage, but whose Wages and salaries earned by either party during the cohabitation shall
marriage is nonetheless void for other reasons: be owned by the parties in equal shares and will be divided equally
(1) Psychological incapacity (Article 36 FC) among them, even if only one party earned the wages. (Carino v. Carino)
(2) No valid marriage license (Art. 35)
(3) No legal authority to solemnize marriages and either or both parties (b) On property acquired during cohabitation
cannot claim good faith  Properties acquired by both parties during their union through their
(4) Marriages contracted through mistake as to the identity of work and industry shall be governed by the rules on equal co-
contracting party ownership and are prima facie presumed to have been
(5) Failure to comply with procedural requirements of Article 52 (Article obtained through their joint efforts. (Valdes v. RTC)
35[6], in relation to Article 53 FC) o Article 147 creates a presumption that properties
acquired during the cohabitation of the parties have been
Article 148: If the marriage is void because the parties are suffering acquired through their joint efforts, work, or industry, and
from legal impediments shall be owned by them in equal shares. (Gonzales v.
(1) Below 18 years old Gonzales)
 Rebut: prove that the other did not contribute in the To be a co-owner, you must prove that you contributed money, property,
acquisition of any property acquired during the or industry. Contribution in maintaining the household or taking care of
cohabitation. the family does not apply.
 What form of contribution?  There must be proof of actual contribution.
 Actual contribution of money, industry, property, or  Registration of property under one’s own name ISN’T ENOUGH.
maintaining the household or taking care of the
family (a) On salary and wages
 If there is no contribution, the property is exclusively Wages and salaries earned by each party belong to him exclusively.
owned by the contributing party
 Tan-Andal v. Andal: Woman inherited property. SC (b) On property acquired during cohabitation
said that was her exclusive property because the Only the properties acquired by both of the parties through their
man did not contribute even in the form of “actual joint contribution of money, property and industry” shall be
maintaining the household or taking care of the owned by them in common in proportion to their respective
family. The construction was from the exclusive contributions.
funds of the woman.  Mere cohabitation without proof of contribution will not result in
 Thus, 147 is NOT A CO-OWNERSHIP because there’s a co-ownership. (Tumlos v. Fernandez)
a possibility that there is no co-ownership in the absence  Contributions and corresponding shares were prima facie
of contribution. presumed to be equal.
o A party who did not participate in the acquisition by the other o BUT co-ownership will only be up to the extent of the
party of any property shall be deemed to have contributed proven actual contribution of money, property, or industry.
jointly in the acquisition thereof if the former’s efforts (Atienza v. De Castro)
consisted in the care and maintenance of the family and o Adriano v. CA: the fact that the property was titled in the name
of the household. of the parties to an adulterous relationship is not sufficient
o Fruits of the couple’s separate property are not included proof of co-ownership absent evidence of actual contribution
in the co-ownership. in the acquisition of property.
 Registration under the Torrens system merely confirms,
(c) Prohibition against alienation of ideal share in co-ownership and does not vest title. (Ventura v. Abuda)
 During the cohabitation, the parties are prohibited from disposing o The words “married to” preceding the name of a spouse are
by acts inter vivos or encumbering their shares in the co-owned merely descriptive of the civil status of the registered owner
property without the consent of the other. and do not prove co-ownership. (Go-Bangayan v. Bangayan)
o Including the ideal share
o VOID – because the law is prohibitory (c) No prohibition against alienation of ideal share
o Article 493 NCC does not apply.  Unlike in the co-ownership in Article 147, the law does not prohibit
 After the cohabitation, a co-owner can dispose of his share. one of the co-owners in Article 148 from disposing or encumbering,
during the cohabitation, his share in the co-ownership without
(d) Effect of Bad Faith consent.
 If the cohabitation is by reason of a void marriage and only one of o Article 493 NCC applies.
the parties acted in bad faith, the share of the latter in the co-
ownership shall be forfeited in favor of the following, which (d) If one has a valid marriage
forfeiture shall take place upon the termination of the cohabitation:  His share in the co-ownership shall accrue to the ACP or CPG
o Common children existing in the valid marriage.
o In default thereof, surviving descendants of the party who  If there is no valid marriage, the share of the party who acted in
acted in bad faith; or bath faith (whether either or both were in bad faith) shall be forfeited
o In the absence descendants, the innocent party. upon termination of the cohabitation
o Common children
4. Applicable Rules Under Article 148 o Surviving descendants of the party who acted in bad faith
o Innocent party.
ARTICLE 148, FC. In cases of cohabitation not falling under the
preceding Article, only the properties acquired by both of the parties O. Family Relations and Family Home
through their actual joint contribution of money, property, or industry
shall be owned by them in common in proportion to their respective 1. Extent of Family Relations
contributions. In the absence of proof to the contrary, their
contributions and corresponding shares are presumed to be equal. (a) Who are included in “family relations”?
The same rule and presumption shall apply to joint deposits of money ARTICLE 150, FC. Family relations include those:
and evidences of credit. (1) Between husband and wife;
(2) Between parents and children;
If one of the parties is validly married to another, his or her share in (3) Among brothers and sisters, whether of the full or half-blood.
the co-ownership shall accrue to the absolute community or conjugal
partnership existing in such valid marriage. If the party who acted in (1) Husband and wife
bad faith is not validly married to another, his or her shall be forfeited (2) Parents and children
in the manner provided in the last paragraph of the preceding Article. (3) Ascendants and descendants
(4) Brothers and sisters (full or half)
The foregoing rules on forfeiture shall likewise apply even if both
parties are in bad faith. (b) Clarifications
 Enumeration is exclusive and defines the operation of Article 151
FC. (Hontiveros v. RTC)
 Among the collateral blood relatives, only brothers and sisters are Exempt from execution, forced sale, or attachment.
included.
o Other collateral relatives are strangers. (c) Conditions precedent for exemption
 Under the FC, family relations, which is the primary basis for (1) Manner of constitution
succession, exclude relations by affinity (Ining v. Vega). ARTICLE 153, FC. The family home is deemed constituted on a
o In laws are not included. house and lot from the time it is occupied as a family residence.
From the time of its constitution and so long as any of its
2. Requirement of Earnest Efforts Towards Compromise beneficiaries actually resides therein, the family home
continues to be such and is exempt from execution, forced sale or
(a) Rule attachment except as hereinafter provided and to the extent of the
ARTICLE 151, FC. No suit between members of the same family value allowed by law.
shall prosper unless it should appear from the verified complaint or
petition that earnest efforts toward a compromise have been made,  If constructed before FC: it must be judicially or extrajudicially
but that the same have failed. If it is shown that no such efforts were constituted
in fact made, the same case must be dismissed.  If before FC and was not judicially or extrajudicially constituted
under the CC, it automatically became the family home but only
This rules shall not apply to cases which may not be the subject of from August 3, 1988. (Modequillo v. Breva)
compromise under the Civil Code.  FC: A family home is deemed constituted on a house and lot from
 Wee v. Gonzales: If a suit is between “members of same family,” the time it is actually occupied as a family residence.
there must be prior earnest efforts towards a compromise. o Mere actual occupancy is sufficient
Otherwise, the case must be dismissed. o Actual occupancy must be by any beneficiary.
 Condition precedent to the filing of a suit o Maids and overseers is not sufficient (Patricio v. Dario III)
o Otherwise, complaint is premature. (Martinez v. Martinez)
o Failure to comply is not a jurisdictional defect. If the opposing (2) Who must constitute
party fails to raise such defect in a motion to dismiss, the ARTICLE 152, FC. The family home, constituted jointly by the
defect is deemed waived. (Romero v. Singson) husband and the wife or by an unmarried head of a family, is the
dwelling house where they and their family reside, and the land on
(b) Suit must be exclusive among “members of same family” which it is situated.
 Suit must be exclusive among members of the same family.
 Not necessary whenever a stranger to the family is a party, ARTICLE 161, FC. For purposes of availing of the benefits of a family
where necessary or indispensable. (Equivas v. CA) home as provided for in this Chapter, a person may constitute, or
be the beneficiary of, only one family home.
(c) Meaning of “members of same family”  There must be proof that the alleged family home was constituted
 See Article 150. Article 151 must be construed strictly, it being an jointly by
exception to the general rue. o the spouses, or
 Any person not enumerated is considered a stranger. o an unmarried head of a family.
o Nephews and nieces (Moreno v. Kahn)  For purposes of availing the benefits of a family home, a person
o Brother in law (Esquivias v. CA) may constitute only one family home.
o Sister in law (Martinez v. Martinez)
(3) Where constructed
(d) Cases not subject to compromise ARTICLE 156, FC. The family home must be part of the properties
 Article 151 shall not apply to cases which may not be the subject of the absolute community or the conjugal partnership, or of the
of a compromise (Article 2035): exclusive properties of either spouse with the latter’s consent.
o (1) The civil status of persons; It may also be constituted by an unmarried head of a family on his or
o (2) The validity of a marriage or a legal separation; her own property.
o (3) Any ground for legal separation;
o (4) Future support; Nevertheless, property that is the subject of a conditional sale on
o (5) The jurisdiction of courts; installments where ownership is reserved by the vendor only to
o (6) Future legitime. guarantee payment of the purchase price may be constituted as a
family home.
3. Concept and Benefit of Family Home  Must be part of the properties of the ACP or CPG, or
 of the exclusive properties of either spouse with the latter’s
ARTICLE 152, FC. The family home, constituted jointly by the consent, or
husband and the wife or by an unmarried head of a family, is the  on the property of the unmarried head of the family.
dwelling house where they and their family reside, and the land  NOT on property held in co-ownership with third persons.
on which it is situated.
(4) Actual Value
(a) Concept: the family home is a real right which is gratuitous, ARTICLE 157, FC. The actual value of the family home shall not
inalienable and free from attachment, constituted over the dwelling exceed, at the time of its constitution, the amount of the three
place and the land on which it is situated. It confers upon a hundred thousand pesos in urban areas, and two hundred thousand
particular family the right to enjoy such properties. (Salazar v. pesos in rural areas, or such amounts as may hereafter be fixed by
Felias) law.
(1) It cannot be seized by creditors except in special cases.
(b) Benefit of family home

In any event, if the value of the currency changes after the adoption the owner or owners of the property, or by any of the beneficiaries,
of this Code, the value most favorable for the constitution of a family the same rule and procedure shall apply.
home shall be the basis of evaluation
At the time of its constitution, the actual value of the family home shall At the execution sale, no bid below the value allowed for a family
not exceed P300K in urban areas, and P200K in rural areas. (house home shall be considered. The proceeds shall be applied first to
+ lot) the amount mentioned in Article 157, and then to the liabilities under
the judgment and the costs. The excess, if any, shall be delivered to
(d) Exception to protection the judgment debtor.
ARTICLE 155, FC. The family home shall be exempt from execution,
forced sale or attachment except:  If the value of the family home exceeds the maximum amount
(1) For nonpayment of taxes; allowed because of voluntary improvements by the one
(2) For debts incurred prior to the constitution of the family establishing the family home, Article 160 FC will apply.
home;  To warrant the execution sale of the family home under Article 160,
(3) For debts secured by mortgages on the premises before or the following facts are required to be established:
after such constitution; and o There was an increase in its actual value
(4) For debts due to laborers, mechanics, architects, builders, o The increase resulted from voluntary improvements on the
materialmen and others who have rendered service or property introduced by the persons constituting the family
furnished material for the construction of the building. home, its owners, or any of its beneficiaries
o The increased actual value exceeded the maximum allowed
 Debts secured by mortgages are exempted (Vitug v. Abuda) under Article 157.
 Any subsequent improvement or enlargement of the family home
(e) How and who may invoke protection by the persons constituting it, its owners, or any of its
beneficiaries will still be exempt from execution, forced sale, or
(1) How to invoke attachment
 It is not sufficient that the person claiming exemption merely alleges o provided:
that such property is a family home. This claim for exemption must  The actual value of the property at the time of its
be set up and proved to the Sheriff. Failure to do so would estop constitution has been determined to fall below the
the party from later claiming the exception. (Versola v. CA) statutory limit; AND
(2) Personal Privilege  The improvement or enlargement does not result in an
 the right to exemption or forced sale under Article 153 FC is a increase in its value exceeding the statutory limit.
personal privilege granted to the judgment debtor and as such, o Otherwise: The family home can be subject to forced sale, and
it must be claimed not by the sheriff, but by the debtor himself any amount above the statutory limit is applicable to the
before the sale of the property at public auction. (Honrado v. CA) obligations under Article 160.
 While a family home is a real right, which is gratuitous, inalienable
and free from attachment, it can be waived or be barred by laches  160 only applies to a judgment creditor not listed in 155. If listed
by the failure to set up and prove the status of the property as a by 155, you don’t need a court order because the family home is
family home at the time of the levy or a reasonable time. (Olivia-De not protected.
Mesa v. Aceron, Jr.)  Under 160, the family home is initially protected UNLESS the
judgment creditor proves otherwise.
(3) Duration of protection  If the family home is sold under 155, no amount shall be returned
 From the time of its constitution and so long as any of its to the family.
beneficiaries actually resides therein  Under 160, the 300K or 200K must be returned to the family for the
purpose of constructing another family home.
4. Effect of Increase in Actual Value
(b) If by reason of involuntary improvement
(a) If by reason of voluntary improvement  if it is through an involuntary improvement, like the conversion
ARTICLE 153, FC. The family home is deemed constituted on a into a residential area or the establishment of roads and other
house and lot from the time it is occupied as a family residence. From facilities, the one establishing the family home should not be
the time of its constitution and so long as any of its beneficiaries punished by making his home liable to creditors.
actually resides therein, the family home continues to be such and is o HENCE: the family home still enjoys protection from
exempt from execution, forced sale or attachment except as execution, forced sale, or attachment.
hereinafter provided and to the extent of the value allowed by law. o It cannot be sold pursuant to Article 160 FC to satisfy the claim
of a judgment creditor not mentioned in Article 155.
ARTICLE 160, FC. When a creditor whose claims is not among those  It can be sold to claims mentioned in Article 155.
mentioned in Article 155 obtains a judgment in his favor, and he has
reasonable grounds to believe that the family home is actually ARTICLE 155, FC. The family home shall be exempt from execution,
worth more than the maximum amount fixed in Article 157, he forced sale or attachment except:
may apply to the court which rendered the judgment for an order (1) For nonpayment of taxes;
directing the sale of the property under execution. The court shall (2) For debts incurred prior to the constitution of the family home;
so order if it finds that the actual value of the family home exceeds (3) For debts secured by mortgages on the premises before or after
the maximum amount allowed by law as of the time of its constitution. such constitution; and
If the increased actual value exceeds the maximum allowed in (4) For debts due to laborers, mechanics, architects, builders,
Article 157 and results from subsequent voluntary improvements materialmen and others who have rendered service or furnished
introduced by the person or persons constituting the family home, by material for the construction of the building.
5. Effect of Death of Person Who Constituted Family Home ARTICLE 164, FC. Children conceived or born during the marriage
of the parents are legitimate.
ARTICLE 159, FC. The family home shall continue despite the death
of one or both spouses or of the unmarried head of the family for a Children conceived as a result of artificial insemination of the wife
period of ten years or for as long as there is a minor beneficiary, and with the sperm of the husband or that of a donor or both are likewise
the heirs cannot partition the same unless the court finds compelling legitimate children of the husband and his wife, provided, that both of
reasons therefor. This rule shall apply regardless of whoever owns them authorized or ratified such insemination in a written instrument
the property or constituted the family home. executed and signed by them before the birth of the child. The
instrument shall be recorded in the civil registry together with the birth
(a) Continuance of family home certificate of the child.
 If there are beneficiaries who survive living in the family home, it
will continue for ten years, unless at the expiration of the ten ARTICLE 165, FC. Children conceived and born outside a valid
years, there is still a minor beneficiary, in which case the family marriage are illegitimate, unless otherwise provided in this Code.
home continues until that beneficiary becomes of age.
 LEGITIMATE:
(b) Prohibition against partition o Conceived OR
 During the continuance of the family home, the heirs cannot o Born during a valid/voidable marriage
partition the same unless the court finds compelling reasons  It is sufficient for the conception/birth to take place during
therefor. a valid marriage (so voidable/valid)
 ILLEGITIMATE
(c) Beneficiaries of family home o Conceived AND born outside a valid marriage.
The are two sets of beneficiaries:  Children of those NOT MARRIAGE are illegitimate.
ARTICLE 154, FC. The beneficiaries of a family home are: o GR: Children of void marriages are generally illegitimate.
(1) The husband and wife, or an unmarried person who is the head  EXC: Article 36 and 53 legitimate. (Article 54 in relation
of a family; and 165, FC)
(2) Their parents, ascendants, descendants, brothers and sisters,  Psychological incapacity (36)
whether the relationship be legitimate or illegitimate, who are  Subsequent marriage without recording of the
living in the family home and who depend upon the head of the judgment of annulment or of absolute nullity,
family for legal support. partition and distribution of properties, and delivery
of children’s presumptive legitimes in the civil
However, for purposes of availing of the benefits of a family home, a registry and registries of property
person may be the beneficiary of only one family home. (Article 161 FC)
Who are Legitimate?
In order for the relatives of the person who constituted the family (1) Child conceived OR born inside a valid marriage by the wife by
home to be considered a beneficiary of the family home, three reason of the sexual intercourse between the spouses. (164
requisites must concur: paragraph 1 FC)
(1) they must be among the relationships enumerated in Art. 154 of (2) Children of voidable marriages.
the Family Code; (a) A voidable marriage is valid until annulled by final judgment.
(2) they live in the family home; and (b) In the event the marriage is annulled, the question is whether
(3) they are dependent for legal support upon the head of the the conception of the child prior to the judgment of annulment.
family. If so, the child is legitimate.
(3) Children of void marriages under Articles 36 and 43.
P. Paternity and Filiation (4) Children who are products of artificial insemination (64, para 2)
1. Filiation and Status of Children ARTICLE 36, FC. A marriage contracted by any party who, at the
time of the celebration, was psychologically incapacitated to comply
(a) Paternity and Filiation with the essential marital obligations of marriage, shall likewise be
void even if such incapacity becomes manifest only after its
 PATERNITY: civil status of a father in relation to the child. solemnization.
 FILIATION: civil status of a child in relation to his/her parents.
ARTICLE 53, FC. Either of the former spouses may marry again after
(b) Kinds of Filiation compliance with the requirements of the immediately preceding
Article; otherwise, the subsequent marriage shall be null and void.
ARTICLE 163, FC. The filiation of children may be by nature or by
adoption. Natural filiation may be legitimate or illegitimate. ARTICLE 54, FC. Children conceived or born before the judgment of
annulment or absolute nullity of the marriage under Article 36 has
(1) Natural: by reason of blood relationship, legitimate or become final and executory shall be considered legitimate. Children
illegitimate conceived or born of the subsequent marriage under Article 53 shall
 Includes artificial insemination likewise be legitimate.
(2) Artificial: by reason of adoption
(d) Legitimated Children
(c) Status of Children Only previously illegitimate children may be legitimated.
 The status of a marriage determines the filiation of its resultant Legitimated: NOT A SEPARATE STATUS. There are only legitimate
issue. (De Santos v. Angeles) and illegitimate children.
RULES
 Thus, upon legitimation, the child becomes legitimate. Prior o He is the only one directly confronted with this scandal and
thereto, he is illegitimate. ridicule which the infidelity of his wife produces.
o He should be the one to decide whether to conceal the
(e) Artificial Insemination infidelity or expose it in view of the moral and economic
 The egg of the wife is fertilized through artificial means with the interest involved. (Liyao)
sperm of the husband or donor.  Upon his death, his heirs acquire the right to impugn in the
 Regardless if the sperm is from the husband or donor, the child is following:
legitimate: if:
o both of them authorized or ratified such insemination in a ARTICLE 171, FC. The heirs of the husband may impugn the filiation
written instrument of the child within the period prescribed in the preceding article only
o executed and signed by them before the birth of the child. in the following cases:
o It is the wife who bore and delivered the child. (1) If the husband should die before the expiration of the period
 Surrogate mother – not authorized by the FC. fixed for bringing his action;
 Egg cell must be from the wife. The sperm may be from (2) If he should die after the filing of the complaint without having
the husband or a donor. desisted therefrom; or
 Since the husband consented to the use of his sperm, he (3) If the child was born after the death of the husband.
cannot impugn the legitimacy based on biological or
scientific reasons. The only ground is when the consent  As consequence of this rule, the child himself cannot choose his
was vitiated. own filiation. If the husband, presumed to be the father does
not impugn the legitimacy of the child, then the status of the
(f) Surrogate Mother child is fixed, and the latter cannot choose to be the child of his
 PH law does not recognize the validity of a surrogate mother mother’s alleged paramour. (Liyao)
contract, which is any agreement in which a woman agrees to  Thus:
conceive or carry a child for another individual or a couple, either o The child cannot maintain an action to claim illegitimate
free of charge or for a consideration. filiation against the mother’s alleged paramour.
 It is contrary to laws, morals, and public policy. o The mother’s alleged paramour cannot recognize or admit his
 The child is considered an illegitimate child of the surrogate, if paternity over the child.
the she is not married.  Rationale:
o If the husband admits paternity over the child, the child is an o This is a collateral attack upon the child’s legitimacy,
illegitimate child of the husband also. which is not allowed because the legitimacy can only be
o It is only the mother who has sole parental authority over an impugned in a direct action brought for that purpose by the
IC. This cannot be validly waived or transferred except in proper parties and within the period limited by law (Tison v.
cases authorized by law. (Adoption, guardianship, foster care CA)
act, etc.) (Article 210) o They are not the proper parties to question the legitimacy
o Estoppel cannot be used for the surrogate mother to recover  Father OR
custody.  His heirs in exceptional circumstances.
o Can the couple recover the amount paid by the couple to
the surrogate? NO. Estoppel is applicable. That is an effect Rules to Impugn Legitimacy
of an ordinary contract. Since this contract is void, it is an (1) Direct Attack (Action Impugning Legitimacy)
illegal contract. The principle of in pari delicto is applicable. (2) Filed by the husband, if the husband is alive: Only the husband can
The court cannot come to the aid of the parties. deny his paternity
 If the surrogate mother and spouses who hired her are Filipino (a) Upon death, right to impugn is transmitted to the heirs
citizens, and the contract states the surrogate waives any rights – (i) Husband dies prior to the expiration of the prescriptive
this contract is void. period
(ii) Husband dies before the birth of the child
2. Presumption of Legitimacy (iii) During the pendency of the action, there will only be
substitution of parties.
Presumption of the good faith of the wife. This is a presumption of (3) During the prescriptive period
highest order, although rebuttable. Presumption applies so long as the (a) 1/2/3 years (see below)
concepcion/birth of the child takes place in a valid, voidable, or void (4) Grounds for Denial of paternity are exclusive. (166)
marriage under Articles 36 and 53.
(c) Mother cannot impugn child’s legitimacy
(a) Statement of Presumption RULE: Presumption of legitimacy will not be affected even if:
 SSS v. Aguas, Concepcion v. CA, Liyao Jr. v. Tanhoti-Liyao: A ARTICLE 167, FC. The child shall be considered legitimate although
child conceived or born by the wife during a valid marriage is the mother may have declared against its legitimacy or may
presumed to be legitimate and presumed a child of the husband. have been sentenced as an adulteress.
o If the spouses are merely separated in fact, the child of the  Applies only where the wife denies the paternity of the husband.
wife with the paramour is presumed to be a legitimate child  167 does not apply where a child alleged to not be the child of
of the husband and wife. (Liyao) the couple.
o If the wife contracted a bigamous marriage and had a child
in the subsequent marriage, the child is presumed to be a (d) Prescriptive Period of Action to Impugn Legitimacy
legitimate child of the prior marriage. (Concepcion) ARTICLE 170, FC. The action to impugn the legitimacy of the child
shall be brought within one year from the knowledge of the birth or its
(b) Only Husband Can Impugn Child’s Legitimacy recording in the civil register, if the husband or, in a proper case, any
 While the husband is alive, impugning the legitimacy of the child
is strictly his personal right.
of his heirs, should reside in the city or municipality where the birth
took place or was recorded. (1) Physical impossibility of sexual intercourse
If the husband or, in his default, all of his heirs do not reside at the  it was physically impossible for the husband to have sexual
place of birth as defined in the first paragraph or where it was intercourse with his wife within the first 120 days of the 300 days
recorded, the period shall be two years if they should reside in the which immediately preceded the birth of the child because of:
Philippines; and three years if abroad. If the birth of the child has o the physical incapacity of the husband to have sexual
been concealed from or was unknown to the husband or his heirs, intercourse with his wife;
the period shall be counted from the discovery or knowledge of the  Impotency, NOT STERILITY
birth of the child or of the fact of registration of said birth, whichever o the fact that the husband and wife were living separately in
is earlier. such a way that sexual intercourse was not possible; or
 There must be proof of physical impossibility.
ARTICLE 171, FC. The heirs of the husband may impugn the filiation  Intercourse is possible every day.
of the child within the period prescribed in the preceding article only  There must be proof if IMPOSSIBILITY. Ex. OFWs.
in the following cases: o serious illness of the husband, which absolutely prevented
(1) If the husband should die before the expiration of the period sexual intercourse;
fixed for bringing his action;  What if the husband was covered in plaster for
(2) If he should die after the filing of the complaint without having burns? It’s still not physically impossible
desisted therefrom; or  If the man is comatose and the husband’s penis is unable
(3) If the child was born after the death of the husband. to rise to the occasion?
 You have to prove that there is physical impossible
Period When during the entire concepcion.
1 Year from Husband, or in exceptional cases, any of (2) Biological or scientific reasons: the child could not have
knowledge of birth or his heirs, resides in the city or been that of the husband, except in the instance provided in
recording of such birth municipality where the birth took place the second paragraph of Article 164
in the civil register or was recorded.  Blood testing, which is conclusive on paternity (Jao v.
2 years  If the husband or, in his default, all of CA)
his heirs do not reside at the place of  If denial of paternity – it’s conclusive – this may be
birth or where it was recorded AND used by the putative father
 Residents of the PH  DNA test, which may be used to establish paternity or
3 years Husband or heirs reside abroad. non-paternity (Tijing v. CA, Tecson v. Comelec, Agustic
Birth of the child was abroad. v. CA)
(3) Ground in artificial insemination: written authorization or
ratification of either parent was obtained through mistake,
 Upon the expiration of the periods in 170 AND in proper cases in
fraud, violence, intimidation, or undue influence
171
o Action to impugn legitimacy would no longer be legally
(f) Legitimacy not Subject to Collateral Attack
feasible and the status conferred by the presumption
Legitimacy can be impugned only in a direct action brought for that
becomes FIXED AND UNASSAILABLE (SSS v. Aguas)
purpose, by the proper parties, and within the period limited by law.
o This is no longer a presumption. The status is FIXED.
(Braza v. City Civil Registrar of Himamaylan City) Hence:
 The periods apply if the action is to impugn legitimacy.
 Legitimacy cannot be controverted in an action for reconveyance
o IF the assertion is not the child of the spouses, 170 and 171
 Action for partition with inventory and accounting (De Jesus v.
do not apply. (Labagala v. Santiago, Babiera v. Catotal,
Estate of Dizon)
Benitez-Badua v. CA)
 Petition for correction of Entries under Rule 108 (Miller v. Miller)
(e) Grounds to Impugn Legitimacy
(g) Effect of Termination of Marriage and Remarriage of Mother
If the previous marriage is terminated and the mother contracted a
ARTICLE 166, FC. Legitimacy of a child may be impugned only on
marriage within 300 days after the termination of the marriage, and a
the following grounds:
child is born within 300 days after the termination of the previous
(1) That it was physically impossible for the husband to have
marriage, then:
sexual intercourse with his wife within the first 120 days of the
(1) The first husband is the father if the child is born before 180 days
300 days which immediately preceded the birth of the child
after the solemnization of the second marriage and within 300
because of:
days after the termination of the previous marriage. OR
(a) the physical incapacity of the husband to have sexual
(2) The second husband is the father if the child is born after 180 days
intercourse with his wife;
following the celebration of the second marriage, even if born
(b) the fact that the husband and wife were living separately in
within the 300 days after the termination of the former
such a way that sexual intercourse was not possible; or
marriage.
(c) serious illness of the husband, which absolutely prevented
sexual intercourse;
See: Miller v. Miller, Braza v. City Civil Registrar of Himamaylan City
(2) That it is proved that for biological or other scientific reasons,
the child could not have been that of the husband, except in the
instance provided in the second paragraph of Article 164; or
(3) That in case of children conceived through artificial
insemination, the written authorization or ratification of either
parent was obtained through mistake, fraud, violence,
intimidation, or undue influence.
Paragraph 2 – lifetime of the

child AND putative parent
(c) Same Manner of Proving

RULE:
ARTICLE 175, FC. Illegitimate children may establish their
illegitimate filiation in the same way and on the same evidence
as legitimate children.
The action must be brought within the same period specified in Article
173, except when the action is based on the second paragraph of
Article 172, in which case the action may be brought during the
lifetime of the alleged parent.
PRESCRIPTIVE PERIOD:
ARTICLE 173, FC. The action to claim legitimacy may be brought by
the child during his or her lifetime and shall be transmitted to the
heirs should the child die during minority or in a state of insanity. In
Count 300 days. Then count 120 days backwards. these cases, the heirs shall have a period of five years within which
to institute the action.
(h) Effect if Child Born after 300 Days
ARTICLE 169, FC. The legitimacy or illegitimacy of a child born ARTICLE 175, para. 2, FC. XXX The action must be brought within
after three hundred days following the termination of the marriage the same period specified in Article 173, except when the action is
shall be proved by whoever alleges such legitimacy or based on the second paragraph of Article 172, in which case the
illegitimacy. action may be brought during the lifetime of the alleged parent.
3. Action to Prove Legitimate or Illegitimate Filiation  Whether the action is to prove legitimate or illegitimate filiation, the
action may be brough by the child during his/her lifetime.
(a) Not subject to agreement  The action is transmitted to the heirs when:
o The child dies during minority; OR
RULE: Public policy demands that there be no compromise on the status o The child dies in a state of insanity.
and filiation of a child. Paternity and filiation or the lack of the same, is a  The heirs have 5 years to institute the action these
relationship that must be judicially established. It cannot be left to the cases.
will or agreement of the parties. (Uy v. Chua, De Asis v. CA, Rivero v.
CA) When action allowed after death of alleged parents
ACTION PERIOD
Prohibited Compromise: Article 2035(1) NCC prohibits a compromise Action for legitimate filiation  Action may be brought
upon the civil status of persons. during his lifetime and
even after the death of the
(b) Action to Claim Filiation alleged parents whether
the action is based on
LEGITIMATE FILIATION paragraph 1 or 2 of Article
 It is an action filed by a child to prove he/she is a legitimate 172 FC.
child of a couple who are validly married.  Only limitation is the
 Aguilar v. Siasat: The child was able to prove his legitimate filiation lifetime of the child.
with a certain couple using a public document (SSS Form E-1 of illegitimate filiation based on The action may be brought by
his father acknowledging his filiation to the child.) paragraph 1 of Article 172 the child during his lifetime and
 Ex. Mara Clara  Record of birth appearing even after the death of the
in the civil register or a final alleged parents.
ILLEGITIMATE FILIATION judgment; or
 An action by a child to prove he/she is a biological child of the  An admission of legitimate
alleged parent, although conceived and born outside of wedlock. filiation
 Ordinary, it is an action to prove paternity. But it can also prove Illegitimate filiation based on  During the lifetime of the
maternity.  open and continuous alleged parent.
 Ara v. Pizarro: Two children claimed to be the illegitimate children possession of the status  Death of the parent bars the
of Josefa Ara. The SC ruled that since Ara had already died, both of a legitimate child; or action.
were proscribed from proving their filiation under Article 172 FC.  any other means allowed  Dual limitation:
by the Rules of Court and o Lifetime of the child
Illegitimate Legitimate special laws o Lifetime of the putative
Proof Same parent
Period After the death of the parents Lifetime of the child
Paragraph 1 (voluntary Child may file the  If the action for support was filed while the putative parent was
admission) – even after the action even after alive, it is not barred under paragraph 2 of Article 172 FC.
death of the alleged parent – death of the parents
lifetime of the child
o The death of the putative father is not a bar to the action  May be signed by EITHER mother or father.
commenced during his lifetime by one claiming to be his
illegitimate child. (Salas v. Matusalem) Action for Illegitimate Filiation
o The rule on substitution of parties under Section 16, Rule 3 of  With the father – the father must have signed the birth certificate.
the ROC applies. You cannot place his name WITHOUT HIS CONSENT.
4. Proof of Filiation  GR: If the illegitimate father did not sign the birth certificate,
the placing of his name by the mother, doctor, register, or
ARTICLE 172, FC. The filiation of legitimate children is established other person is incompetent evidence of paternity (Roces v.
by any of the following: Local Civil Registrar, Berciles v. GSIS). The Local Civil Registrar is
(1) The record of birth appearing in the civil register or a final devoid of authority to record the paternity of an illegitimate child
judgment; or upon the information of such third person. (Jison v. CA).
(2) An admission of legitimate filiation in a public document or a  EXC: there is a showing that the putative father had a hand in
private handwritten instrument and signed by the parent preparing the birth certificate (Castro v. CA, Ilano v. CA, Arado
concerned. v. Alcoran)
o he was the one who went to the registry and gave all the data
In the absence of the foregoing evidence, the legitimate filiation shall about the birth
be roved by: o he caused the registration of the birth certificate
(1) The open and continuous possession of the status of a o he supplied the information himself about the birth and his
legitimate child; or paternity.
(2) Any other means allowed by the Rules of Court and special o THUS: This may be used even after the death of the father.
laws. o Ilano v. CA: the father supplied the information during the
interview
(a) Voluntary Admission of Filiation o Arado v. Alcoran: The father did not supply the information.
No need for judicial action. The voluntary admission is already a The mother supplied the information and signed the
completed act. certificate. BUT the father registered the birth certificate,
which indicated that he was the father.
Sometimes, the child is still denied his rights. For example, the child files  A delayed registration of birth, after the death of the putative
an action for support after the father stopped giving it. parent, is tenuous proof of filiation.
o It is analogous to cases where a putative father’s name is
Or upon the death of the father, IC is denied successional rights by the written on a birth certificate of an illegitimate child without any
legitimate family. He will be forced to present proof here. showing that the putative father participated in preparing the
certificate. (Ara v. Pizarro)
(1) Record of Birth Appearing in Civil Registry or Final  When the birth certificate is signed by the father, it is competent
Judgment evidence of paternity (SSS v. Aguas) and there is no further need
to file any action for acknowledgement because said mode is by
Importance of Birth Certificate itself a consummated act. (Montefalcon v. Vasquez)
 A birth certificate is a formidable piece of evidence prescribed by  Zoleta-San Agustin v. Sales: The illegitimate father was no longer
both the Civil Code and Article 172 FC for purposes of recognition capable of writing his name as he was blind and bedridden at the
and filiation. (Solinap v. Locsin) time he affixed his thumbmark to notarized documents of
 Being a public document, it offers prima facie evidence of filiation admission of filiation.
(Sayson v. CA) and a high degree of proof is needed to overthrow o SC said that a thumbmark is a valid mode of signature.
the presumption of truth (Heirs of Pedro Cabais v. CA)
(2) Public Instrument of Admission of Filiation
Validity of Birth Certificate Signed + purpose is to admit filiation
 Section 5, RA 3753 (Civil Registry Law): in the registration of the  The public document in Article 172 FC refers to the written
birth of a legitimate child, the law allows the birth certificate to be admission of filiation in a public document purposely
signed by either parent. executed as an admission of filiation and not for some other
 For an illegitimate child, it is mother that signs the birth certificate purpose (Fernandez v. Fernandez).
of her child in all cases, irrespective of whether the father o Admission was made personally by the parent. Otherwise, the
recognizes the child or not. (Barcelote v. Republic) admission is ineffectual.
o If only the father registered the birth of the illegitimate child,  Some Examples of Documents proving Paternity
without the consent of the mother, the birth certificate is void. o Aguilar v. Siasat: Admission of filiation was made in the SSS
Form E-1.
Illegitimate Child o A notarial agreement to support a child whose filiation is
Who? admitted by the putative father is acceptable evidence to
 Mother and father, if the father admits paternity prove paternity. (Marcaydav. Naz cited in Herrera v. Alba)
 Mother, if the father does not admit paternity o Notarial and holographic wills
o Birth certificate MUST ALWAYS BE SIGNED BY THE  They no longer need to be probated or to be strictly in
MOTHER conformity with the formalities for purposes of
establishing filiation (Potenciano v. Reynoso)
When Considered Competent Evidence  Even if revoked or denied probate
Legitimate Filiation  The admission is not dependent on the validity of the will.
 If the BC is signed only by the birth attendant, to be competent proof
of legitimate filiation, there must be proof of the valid marriage of (3) Private Handwritten Instrument of Admission of Filiation
the parents. (Angeles v. Malaya)
Requisites intention to consider the child as his and such recognition has
(1) It must be in the parent’s own handwriting been consistently shown and manifested throughout the
(2) There must be a statement or admission of paternity or filiation years publicly, spontaneously, continuously, and in an
(3) It must be signed by the parent concerned. uninterrupted manner, and not merely shown by sporadic and
isolated actions.
EXC: Effect of Absence of Signature (2) The proven actions must show clear manifestations of
 Dela Cruz v. Garcia: Court sees it fit to adopt the following rules parental affection and care and not attributable to pure charity.
respecting the requirement of affixing the signature of the
acknowledging parent in any private handwritten instrument (2) Other Means Allowed by Law or by Rules of Court
wherein an admission of filiation of a legitimate or illegitimate child If the purpose is to prove paternity, the result of a blood test is NOT
is made: conclusive. This is not competent proof of paternity.
o The admission was made in the diary of the putative father.  Result of DNA Test: competent evidence to prove filiation and
The father died before the birth of the child. When the mother paternity. (Tijing v. CA, Tecson v. Comelec, Agustin v. CA)
tried to put the name of the father in the registry, she was not o Herrera v. Alba: An order directing the alleged father to
allowed by the local civil registry. The mother filed an action undergo DNA paternity testing does not violate his right
for mandamus. Mother presented the diary/autobiography against self-incrimination because such right applies only to
and the father and brothers of the deceased also testified. testimonial evidence. The Rules on Evidence do not pose any
o The law does not explicitly require the signature of the father legal obstacle to the admissibility of DNA analysis as
in 176. But it must be read with 172 and 175. evidence.
 Additional Rules o Estate of Rogelio Ong v. Diaz: The death of the claimed
o 1) Where the private handwritten instrument is the lone piece father does not ipso facto negate the application of DNA
of evidence submitted to prove filiation, there should be testing as long as there exists appropriate biological samples
strict compliance with the requirement that the same must be of his DNA
signed by the acknowledging parent; and o Lucas v. Lucas: To warrant the issuance of a DNA testing
o 2) Where the private handwritten instrument is accompanied order, there must be a show cause hearing wherein the
by other relevant and competent evidence, it suffices that applicant must present sufficient evidence to establish a prima
the claim of filiation therein be shown to have been made and facie case or a reasonable possibility of paternity or good
handwritten by the acknowledging parent as it is merely cause for holding the test.
corroborative of such other evidence.  The issuance of a DNA testing order is discretionary
upon the court.
Effect of Admission if child is presumed legitimate child of  If there is already preponderance of evidence to
someone else establish paternity and the DNA test result would only be
 De Jesus v. Estate of Dizon: If the child is presumed be legitimate corroborative, the court may disallow the testing.
by applying Article 164 FC, any admission of paternity by the  Result of Blood Test: Not conclusive on paternity. It’s not
wife’s paramour to prove illegitimate filiation may not be given competent evidence (Jao v. CA)
effect.  Physical Resemblance: It’s extremely subjective. It’s not
o It is only when the legitimacy of a child has been successfully competent evidence to prove paternity and filiation. (Cabatania v.
impugned that the paternity of the husband can be rejected. CA)
 Other proof: In the absence of the record of birth and
(b) Compulsory Recognition of Filiation admission of legitimate filiation, paternity and filiation may be
 There is no voluntary admission. The supposed parent is denying proved by other means under the ROC and special laws.
filiation. o EXAMPLE: baptismal certificate, a judicial admission, a
 Paragraph 2 will only be used if there is no proof under para. 1. family Bible in which his name has been entered, common
reputation respecting his pedigree, admission by silence, the
(1) Open and Continuous Possession of Status testimonies of witnesses, and other kinds of proof admissible
under Rule 130. (Heirs of Fabillar v. Paller) – pedigree, family
 Concept: It is the enjoyment by the child of the position and tree
privileges usually attached to the status of a legitimate or o The totality of evidence should be sufficient to establish
illegitimate child. (Fernandez v. Fernandez) filiation because a high standard of proof is required to
establish paternity and filiation. Order for recognition is issued
Requisites only upon clear and convincing evidence.
 Illegitimate Child: There must be evidence of the manifestation of o Makati Shangri-la Hotel and Resort, Inc. v. Harper: The
the permanent intention of the supposed father to consider the Heirs of Ignacio Conti v. CA did not treat a baptismal
child as his, by continuous and clear manifestations of certificate, alone, as sufficient to prove filiation. It had
parental affection and care, which cannot be attributed to pure evidentiary value if considered alongside other evidence
charity. of filiation.
 Such acts must reveal not only the conviction of paternity but also
the apparent desire to have and treat the child as such in all 5. Rights of Legitimate and Illegitimate Children
relations in society and in life, not accidentally, but continuously.
o Continuous: uninterrupted and consistent, but does not ARTICLE 175, FC. Legitimate children shall have the right:
require any particular length of time. (1) To bear the surnames of the father and the mother, in
(Jison v. CA, Mendoza v. CA, Perla v. Baring) conformity with the provisions of the Civil Code on Surnames;
(2) To receive support from their parents, their ascendants, and in
(1) Evidence of permanent intention of the supposed of the proper cases, their brothers and sisters, in conformity with the
supposed father to consider the child as his and such provisions of this Code on Support; and
(3) To be entitled to the legitimate and other successional rights not the father or the mother who is granted by law the right to dictate
granted to them by the Civil Code. the surname of their illegitimate children.
o The use of the word "may" in the provision readily shows that
(a) Right to Use Surname an acknowledged illegitimate child is under no compulsion to
use the surname of his illegitimate father.
(1) Legitimate Children o HENCE: A father cannot compel the use of his surname by
his IC upon recognition of their filiation.
ARTICLE 364, NCC. Legitimate and legitimated children shall
principally use the surname of the father. Effect if no signature on private handwritten instrument
 Dela Cruz v. Garcia:
 Have the right to use the surnames of the mother and father. They o Where the private handwritten instrument is the lone piece of
shall principally use the surname of the father. evidence submitted to prove filiation, there should be strict
o For a valid reason, the child may be allowed to change his compliance with the requirement that the same must be
surname to the mother’s because the word “principally” is not signed by the acknowledging parent
equivalent to “exclusively.” There is no legal obstacle if a  Otherwise, such instrument cannot authorize the child to
legitimate child chooses the surname of the mother, to which use the father’s surname.
he/she is entitled. (Alfon v. Republic, Oshita v. Republic) o Where the private handwritten instrument is accompanied by
o The child is not allowed to replace the father’s surname with other relevant and competent evidence, it suffices that the
that of the stepfather’s because it may result into confusion claim of filiation therein be shown to have been made and
with respect to the child’s paternity. (Republic v. CA, Moore v. handwritten by the acknowledging parent as it is merely
Republic, Padilla v. Republic) corroborative of such other evidence.
o Alano vs. Republic: Equal treatment of the law between the  In which case, such instrument authorizes the child to
two sexes should be read into Article 364 NCC. Child has the use the father’s surname.
option to use either the father or mother’s surname.
 Sir Rabuya: This is a re-writing of the NCC. This is Use of stepfather’s surname
judicial legislation. We can still support the ruling  While a legitimate child was not allowed to use the surname of the
because in that case, there was a valid reason. The stepfather, an illegitimate child was allowed because the same
factual backdrop of Alano is similar to Alfon v. Republic. would eliminate the stigma of illegitimacy which the child would
 364 is still mandatory. carry if he/she continues to use the surname of the illegitimate
father. (Calderon v. Republic, Llaneta v. Agrava)
(2) Illegitimate Children
(b) Right to Receive Support
ARTICLE 176, FC. Illegitimate children shall use the surname and
shall be under the parental authority of their mother, and shall be ARTICLE 94, FC. The absolute community of property shall be liable
entitled to support in conformity with this Code. However, illegitimate for:
children may use the surname of their father if their filiation has (1) The support of the spouses, their common children, and legitimate
been expressly recognized by the father through the record of children of either spouse; however, the support of illegitimate children
birth appearing in the civil register, or when an admission in a public shall be governed by the provisions of this Code on Support;
document or private handwritten instrument is made by the
father. Provided, the father has the right to institute an action before ARTICLE 121, FC. The conjugal partnership shall be liable for:
the regular courts to prove non-filiation during his lifetime. The (1) The support of the spouse, their common children, and the
legitime of each illegitimate child shall consist of one-half of the legitimate children of either spouse; however, the support of
legitime of a legitimate child. illegitimate children shall be governed by the provisions of this Code
on Support;
 RULE: In the absence of recognition by the father, IC are required
to use the surname of the mother. (1) Legitimate Children
o 176 uses the word “shall”  mandatory.
o The discretion on the part of the illegitimate child to use the  Support for legitimate children is a liability of the ACP or the CPG.
surname of the father is conditional upon proof of compliance o If ACP/CPG is insufficient, the spouses are liable with their
with RA 9255 and its IRR, amending Article 176 FC. separate properties.
(Barcelote v. Republic)
o An IC acquires the right to use the father’s surname if he is (2) Illegitimate Children
voluntarily recognized by the father:
 if their filiation has been expressly recognized by the Against whose property may payment be charged
father through the record of birth appearing in the civil
register, or ARTICLE 197, FC. In case of legitimate ascendants; descendants,
 when an admission in a public document or private whether legitimate or illegitimate; and brothers and sisters, whether
handwritten instrument is made by the father legitimately or illegitimately related, only the separate property of the
 Exceptional case: Dela Cruz v. Garcia person obliged to give support shall be answerable provided that in
 If the recognition is COMPULSORY, the IC cannot use case the obligor has no separate property, the absolute community
the surname of the father. or the conjugal partnership, if financially capable, shall advance the
support, which shall be deducted from the share of the spouse
Use of father’s surname discretionary obliged upon the liquidation of the absolute community or of the
 Grande v. Antonio: Art. 176 gives illegitimate children the right to conjugal partnership.
decide if they want to use the surname of their father or not. It is
 GR: Support of IC of either spouse is the liability of the exclusive ARTICLE 177, FC. Children conceived and born outside of wedlock
property of the illegitimate parent. of parents who, at the time of conception of the former, were not
o EXC: disqualified by any impediment to marry each other, or were so
 ACP: In case of absence or insufficiency of exclusive disqualified only because either or both of them were below eighteen
property, the same shall be advanced by the ACP. (18) years of age, may be legitimated.
 CPG: The support can be charged over the assets of the
partnership in case of absence of insufficiency only if ARTICLE 178, FC. Legitimation shall take place by a subsequent
the responsibilities of the CPG (Article 121 FC) have valid marriage between parents. The annulment of a voidable
been covered. (Article 122, Dewara v. Lamela, Pana v. marriage shall not affect the legitimation.
Heirs of Juanite, Sr.)
ARTICLE 179, FC. Legitimated children shall enjoy the same rights
Filiation must first be duly established as legitimate children.
 When filiation is beyond question, support follows as a matter of
obligation. Concept: Legitimation is the process where the status of a child
 To establish filiation, an action for compulsory recognition may conceived and born out of wedlock is improved, by operation of
be filed against the putative father ahead of an action for support. law, from illegitimacy to that of legitimacy by the subsequent
o An action of support may be directly filed where the matter marriage of the parents.
of filiation shall be integrated and resolved. (Abella v.
Cabanero, Agustin v. CA) Requisites
(1) Child is conceived and born outside of wedlock.
(c) Successional Rights (2) At the time of conception of the child, parents were not
 GR: LC and IC are compulsory and legal heirs of their parents disqualified by any impediment to marry, or were
o BUT the legitime of an IC shall be ½ of the legitime of a disqualified only because either or both of them were below
legitimate child (Art. 176, as amended) and the intestate share 18 years old.
of an illegitimate child is ½ of the share of a legitimate child (3) After the birth of the child, parents subsequently got married.
(Art. 983, in relation to Article 895 NCC, as amended by Article (4) Marriage is not void ab initio.
176 FC)
Always look at the point of the child’s conception.
Filiation must be duly established
 An illegitimate child must prove his/her filiation to the putative (b) Effects of Legitimation
parent.
 An action to compel recognition may be integrated with an action (1) Child becomes legitimate
to claim inheritance. (Tayag v. CA)  Upon the celebration of the marriage, the status of the child is ipso
jure raised to legitimacy.
(d) Right to Citizenship o Without need of any additional act on the part of either parents
or the child.
(1) Legitimate Children  The child becomes entitled to the same rights enjoyed by a
legitimate child.
 Only legitimate children follow the citizenship of the father.
(Republic v. Sagun) The requirement of affidavit of legitimation is an administrative
o Article IV, Section 1(4), 1935 Consti: The citizenship of a requirement. Even without this, the child is legitimated.
legitimate child born of a Filipino mother and an alien father
followed the citizenship of the father, unless, upon reaching Marriage must be valid, or voidable.
the age of majority, the child elected PH citizenship.  EXC: If the ground is Article 36 or 53, where the intention of the law
o The right to elect PH citizenship was recognized in the 1973 is to make the children legitimate, the child is considered
Consti: “Those who elect PH citizenship pursuant to the 1935 legitimated.
Constitution are citizens of the PH.
 This was carried over to the 1987 Constitution: Those (2) Effects retroactive
born before January 17, 1973, of Filipino mothers, who ARTICLE 180, FC. The effects of legitimation shall retroact to the
elect Philippine citizenship upon reaching the age of time of the child’s birth.
majority” are Filipino citizens.
ARTICLE 181, FC. The legitimation of children who died before the
(2) Illegitimate Children celebration of the marriage shall benefit their descendants.
 only legitimate children follow the citizenship of the father and If the dead child left descendants, legitimation is recognized for the
illegitimate children are under the parental authority of the benefit of descendants. Otherwise, there is no need to recognize the
mother and follow her nationality. legitimation.
 illegitimate child of a Filipina need not perform any act to confer
upon him all the rights and privileges attached to citizens of the (c) Action to Impugn Legitimation
Philippines; he automatically becomes a citizen himself.
Not subject to collateral attack
6. Legitimation  BBB v. AAA: Legitimation cannot be attacked collaterally in the
petition for issuance of protection order.
(a) Concept and Requisites
Who may impugn?
ARTICLE 182, FC. Legitimation may be impugned only by those

who are prejudiced in their rights, within five years from the time 1. Adoption in General
their cause of action accrues.
 Only those whose successional rights are directly affected may Concept: Adoption is the process of making a child, whether related or
impugn the legitimation. not to the adopter, possess in general, the rights accorded to a legitimate
child. (In re the Adoption of Stephanie Garcia)
Prescriptive period  It is a juridical act, a proceeding in rem which creates between
ARTICLE 182, FC. Legitimation may be impugned only by those who two persons a relationship similar to that which results from
are prejudiced in their rights, within five years from the time their legitimate paternity and filiation.
cause of action accrues.  EXC: (RA 11222 (Simulated Birth Rectification Act) The law allows
 5 years from the time of death of either of the parents or child, from the filing of an administrative adoption upon compliance with
whom the plaintiff/petitioner is a compulsory or intestate heir. certain requirements.
Adopted children are entitled to the same rights as LC. Except they are
Grounds not entitled to right of representation in succession.
The inquiry is limited to the issue of whether the following requisites of
legitimation were complied with: Effect of absence of adoption decree or order of adoption
Requisites  In the absence of a judicial decree of adoption (Domestic Adoption
(1) Child is conceived and born outside of wedlock. Act) or order of adoption (RA 11222), a ward (ampon), without the
(2) At the time of conception of the child, parents were not benefit of formal (judicial) adoption, is neither a compulsory nor a
disqualified by any impediment to marry, or were legal heir. (Manuel v. Ferrer, Delgado Vda. De Dela Rosa v. Heirs
disqualified only because either or both of them were below of Marciana Rustia Vda. De Damian)
18 years old.  Section 2(j), RA 8552: "Simulation of birth" is the tampering of
(3) After the birth of the child, parents subsequently got married. the civil registry making it appear in the birth records that a certain
(4) Marriage is valid, or at least, voidable. child was born to a person who is not his/her biological mother
o Does not produce legal effects of adoption
Otherwise, the legitimation does not take place.
Proceedings in rem
Q. Adoption  Adoption is in the nature of proceedings in rem (Ellis v. Republic)
and the court does not acquire over the case if the notice by
RA 11642 – repealed RA 8552 (Domestic Adoption Act), 9523 publication does not carry the true name of the child to be
(Empowering /authorizing the DSWD declaring the child legally available adopted. (Yu Seco v. Republic)
for adoption) o Section 12 (1), Rule on Adoption: the registered name of the
adoptee in the birth certificate and the names by which
RA 8043 (intercountry adoption act) – amended the adoptee has been known which shall be stated in the
Simulated Birth Rectification Act – amended; NACC will handle caption.
Foster Care Act – amended; NACC
Domestic and inter-country adoption
NACC (a) Domestic Adoption (RA 8552)
SECTION 5, RA 11642. National Authority for Child Care (NACC). —  The entire adoption process from the filing of the petition up to the
The Inter- Country Adoption Board (ICAB) is hereby reorganized to a issuance of the adoption decree in the PH.
one-stop quasijudicial agency on alternative child care, known as the
National Authority for Child Care (NACC), attached to the DSWD. When Applicable
(1) If the adopter is a Filipino citizen: he must be a permanent
All duties, functions, and responsibilities of the ICAB, the DSWD, and resident of the PH; OR
those of other government agencies relating to alternative child care (2) If the adopter is a foreigner:
and adoption are hereby transferred to the NACC. (a) he must have been a resident of the PH at least 3
continuous years prior to the filing of the application for
The Department of Budget and Management (DBM), in coordination adoption and maintains such residence until the adoption
with the ICAB and the DSWD, shall formulate a cohesive decree is entered; OR
organizational structure with corresponding plantilla positions (b) such residency requirement may be waived in the following
responsive to fulfill the functions and divisions of the NACC as situations:
stipulated under this Act. (i) adopter is a former Filipino citizen who seeks to
adopt a relative within the 4th degree of
Jurisdiction consanguinity or affinity; or
SECTION 6, RA 11642. The NACC shall have the original and (ii) one who seeks to adopt the legitimate
exclusive jurisdiction over all matters pertaining to alternative child son/daughter of his/her Filipino spouse; or
care, including declaring a child legally available for adoption; (iii) one who is married to a Filipino citizen and seeks
domestic administrative adoption; adult adoption; foster care under to adopt jointly with his/her spouse a relative
Republic Act No. 10165, otherwise known as the "Foster Care Act of within the fourth (4th) degree of consanguinity or
2012"; adoptions under Republic Act No. 11222, otherwise known as affinity of the Filipino spouse
the "Simulated Birth Rectification Act"; and inter-country adoption
under Republic Act No. 8043, otherwise known as the "Inter-Country (b) Inter-Country Adoption (RA 8043)
Adoption Act of 1995." The NACC shall also have the authority to  Where the petition for adoption is filed, the supervised custody is
impose penalties in case of any violation of this Act. undertaken and the decree of adoption is issued outside of the
Courts no longer have jurisdiction over ALL MATTERS OF ADOPTION. PH.
All adoption proceedings are now ADMINISTRATIVE.
When Applicable o Under Section 8(a) DAA, the declaration that a child is legally
(1) If the adopter is a Filipino citizen: he must be permanently available for adoption can be had either judicially or
residing abroad; OR administratively. Said section was repealed by RA 9523.
(2) If the adopter is a foreigner: he does not satisfy the residency The process has been made entirely administrative.
requirement under the Domestic Adoption Act but is qualified to o The certification by the DSWD shall be the primary evidence
under the Inter-Country Adoption Act. that the child is legally available in a domestic adoption
proceeding (RA 8552) and in an inter-country adoption
Rules of Preference in Adoption proceeding (RA 8043)
 Preference in favor of extended family
o If there is a real need for adoption, State policy prefers (b) Adoption of Relative
adoption by the child’s extended family over adoption by an  Santos Jr. v. Republic: Ph laws do not prohibit relatives (by blood
unrelated person. or affinity) from adopting one another:
 Preference in favor of domestic adoption o Adoption of the legitimate child of one spouse by the other
o Inter-country adoption is resorted to only when domestic spouse
adoption is not available and inter-country adoption is in o Adoption of one’s own illegitimate child
the best interest of the child. o Adoption of a person consistently considered and treated by
the adopter(s) as his/her own child since minority.
2. Who May Be Adopted (Section 8, DAA)  The adoptee may be of legal age in this case.
SECTION 22, RA 11642. Who May Be Adopted. — The following (c) Who else may be adopted
may be adopted:  A child whose adoption has been previously rescinded; or
(a) Any child who has been issued a CDCLAA;  A child whose biological or adoptive parent(s) has died.
(b) The legitimate child of one spouse by the other spouse; o No proceedings shall be initiated within 6 months from the
(c) An illegitimate child by a qualified adopter to improve status of time of death of said parent(s).
legitimacy;
(d) A Filipino of legal age if, prior to the adoption, said person has SECTION 34, RA 11642. Order of Adoption. — If the STC, as may
been consistently considered and treated by the adopters be applicable, is satisfactory to the parties and the NACC is
as their own child for a period of at least three (3) years; convinced that, from the trial custody report, the petition and its
(e) A foster child; supporting documents including the STC report if applicable, that the
(f) A child whose adoption has been previously rescinded; adoption shall redound to the best interest of the child or prospective
(g) A child whose biological or adoptive parents have died: adoptee, the NACC through the Executive Director, shall issue an
Provided, That no proceedings shall be initiated within six (6) Order of Adoption which is a registrable civil registry document
months from the time of death of said parents; or stating the name by which the child shall be known and shall likewise
(h) A relative of the adopter. direct the following to perform the actions as stated:
GR: Any child issued CDCLAA (a) The adopter to submit a certified true copy of the Order of
EXC: b – h don’t need legal declaration Adoption to the Civil Registrar where the child was originally
registered within thirty (30) calendar days from receipt of the
The new law did not indicate whether relatives by affinity may be Order of Adoption; and
adopted. (b) The Civil Registrar of the place where the adoptee was
registered:
There no more degree – dati kelangan up to 4th degree (1) To seal the original birth record in the civil registry records
which can be opened only upon order of the NACC; and
(a) Child Legally Available for Adoption (2) To submit to the NACC proof of compliance with all the
 Child has been declared a Child Legally Available for Adoption foregoing within thirty (30) calendar days from receipt of
(RA 9523, repealing Section 2(c)(iii), 3(b)(2), and 8(a) of RA 8552) the Order of Adoption.
 Age of the child
o Below 18; OR An Order of Adoption obtained under this Act shall have the same
o Over 18 but is unable to fully take care of himself/herself effect as a Decree of Adoption issued pursuant to the Domestic
or protect himself/herself from abuse, neglect, cruelty, Adoption Act of 1998. A motion for reconsideration may be filed
exploitation, or discrimination because of physical or mental before the NACC, through the Executive Director, within fifteen (15)
disability or condition. calendar days from an Order denying the adoption.
 Certification Declaring a Child Legally Available for Adoption
applies only to surrendered, abandoned, neglected, and  An Order of Adoption under this law has the same effect as a
dependent children. decree of adoption under the DAA, which has been repealed.
 Order of Adoption replaces judicial decree of adoption
The following does not require a CDCLAA
(1) Adoption of an illegitimate child by a biological parent Judicial recourse
(2) Adoption a child by a step-parent SECTION 35, RA 11642. Judicial Recourse . — Orders of Adoption
(3) Adoption of a child by a relative within the fourth degree of may be appealed before the Court of Appeals within ten (10) days
consanguinity or affinity. from receipt of the Order by the interested party, or from the denial of
the motion for reconsideration; otherwise, the same shall be final and
 Section 8, RA 9523: The certification that a child is legally available executory. Rule 43 of the 1997 Rules of Civil Procedure, as
for adoption shall be issued by the DSWD in lieu of a judicial order, amended, shall have suppletory application.
thus making the entire process administrative in nature.
 After 10 days, Order of Adoption is FINAL unless appealed.
Benefits – an important invention No copy thereof as well as any information relating hereto shall be
SECTION 36, RA 11642. Benefits of Adoptive Parents. — The released without written authority from the NACC or the written
adoptive parents shall enjoy all the benefits entitled to biological request of any of the following:
parents, including benefits that can be availed through the Social
Security System (SSS), Government Service Insurance System (a) The adopted child, with appropriate guidance and counseling,
(GSIS), Department of Labor and Employment (DOLE), Bureau of or a duly authorized representative, spouse, parent, direct
Internal Revenue (BIR), Philippine Health Insurance Corporation descendant, guardian, or legal institution legally in charge of the
(PhilHealth), Health Maintenance Organization (HMO) providers, adopted person, if minor;
among others, or through other existing laws from the date the Order (b) The court or proper public official whenever necessary in an
of Adoption was issued to the adoptive parent. Adoptive parents may administrative, judicial, or other official proceeding to determine
avail of paid maternity and paternity leaves as provided for under the identity of the parent or parents or of the circumstances
existing laws for biological parents: Provided, That the leave benefits surrounding the birth of the adopted child; or
in this paragraph shall only be availed of by the adoptive parents (c) The nearest kin, in case of death of the adopted child.
within one (1) year from the issuance of the Order of Adoption:
Provided, further , That the leave benefits in this paragraph shall not The NACC shall ensure that information held by them concerning the
apply in cases of adult adoptions, and in all cases where the adoptive origin of the adopted child, in particular the identity of the biological
child has been in the care and custody of the adoptive parent for at parents, is preserved.
least three (3) years before the issuance of the Order of Adoption by
the NACC. SECTION 43, RA 11642. Succession. — Intestate and intestate
succession, the adopters and the adoptee shall have reciprocal rights
 SSS Benefits of succession without distinction from legitimate filiations. However,
 Maternity/Paternity benefits, as if you were the one who gave birth if the adoptees and their biological parents have left a will, the law on
o EXC: Adoption of adults; and where the child has been in the testamentary succession shall govern.
custody of the adoptive parent for at least 3 years
o Example: if there are maternity benefits in the CBA, you can  Is the adopted child still entitled to inherit from the biological parents
use this as a ground by operation of law, and vice versa? NO. You can look into the
intention of the law under Section 37 and 39. Di nga alam ng bat
SECTION 37, RA 11642. Civil Registry Record. — An amended an adopted siya, magmamana pa kaya.
certificate of birth shall be issued by the civil registry, pursuant to the  FC did not entirely severe the relationship between the biological
Order of Adoption, attesting to the fact that the adoptee is the child child and adopted child.
of the adopter by being registered with the adopter's surname. The o The adopted child was still entitled to inherit by intestate
original birth record shall be stamped "cancelled" with the annotation succession from the biological parents.
of the issuance of an amended birth certificate in its place and shall o This is no longer the case under RA 11642. The intention is to
be sealed in the civil registry records. The new birth certificate to be keep the adoption secret from the child.
issued to the adoptee shall not bear any notation that it is an
amended issue. SECTION 41, RA 11642. Legitimacy. — The adoptee shall be
considered the legitimate child of the adopter for all intents and
 Palalabasin na certificate of live birth siya. The adoptive parents purposes and as such is entitled to all the rights and obligations
shall appear as biological parents provided by law to legitimate children born to them without
 The old BC shall be sealed discrimination of any kind. To this end, the adoptee is entitled to love,
 The amended birth certificate SHALL NOT HAVE ANY NOTATION guidance, and support in keeping with the means of the family. The
to indicate that it’s an amended issue. legitimate filiation that is created between the adopter and adoptee
shall be extended to the adopter's parents, adopter's legitimate
SECTION 39, RA 11642. Confidentiality. — All petitions, siblings, and legitimate descendants.
documents, records, and papers relating to administrative adoption
proceedings in the files of the city or municipal SWDOs, the The adopter is also given the right to choose the name by which the
RACCOs, the NACC, the DSWD, or any other agency or institution child is to be known, consistent with the best interest of the child.
participating in such proceedings shall be kept strictly confidential. If
the disclosure of certain information to a third person is necessary for  Adoption is no longer personal.
security reasons or for purposes connected with or arising out of the o The adoptee is now related to the parents of the adopter.
administrative adoption and will be for the best interest of the o LEGITIMATE descendants – the adopted child is now filiated
adoptee, the Executive Director of the NACC may, upon appropriate to them.
request, order the necessary information released, restricting the o The children of the adopted is not related to the adopter.
purposes for which it may be used and in accordance with the  This is important for cases of representation.
existing laws on data privacy. o The adopted child can now inherit from the parents of the
adopter.
In any event, the disclosure of any information shall only be allowed  Adopted child can now inherit from the other children and
upon the order of the Executive Director, based on the written request descendants of the adopter.
of the adoptee or in the case of a minor adoptee, his or her legal
guardian or the adoptive parent or upon order of any lawful authority. On Surnames
 Adopted child can be changed but it must be included in the
Any violation of the confidential nature of the records application for adoption
abovementioned shall be punishable pursuant to the penal
provisions of this Act, Republic Act No. 10173 or other relevant laws. Parental Authority
SECTION 42, RA 11642. Parental Authority . — Upon issuance of of the family: Provided, That the requirement of sixteen (16)-
the Order of Adoption, adoption shall cease as alternative care and year difference between the age of the adopter and the adoptee
becomes parental care. Adoptive parents shall now have full parental may be waived when the adopter is the biological parent of the
authority over the child. Except in cases where the biological parent adoptee, or is the spouse of the adoptee's parent;
is the spouse of the adopter, all legal ties between the biological (b) The legal guardian with respect to the ward after the termination
parents and the adoptee shall be severed and the same shall then of the guardianship and clearance of financial accountabilities;
be vested on the adopters. (c) The foster parent with respect to the foster child;
(d) Philippine government officials and employees deployed or
In case spouses jointly adopt or one spouse adopts the legitimate stationed abroad: Provided, That they are able to bring the child
child of the other, joint parental authority shall be exercised by the with them; and
spouses. (e) Foreign nationals who are permanent or habitual residents of
the Philippines for at least five (5) years possessing the same
 Same as the DAA qualifications as above stated for Filipino nationals prior to the
 Under FC, not all legal ties were terminated. filing of the petition: Provided, That they come from a country
o Adopted child can still be an heir of the biological parent and with diplomatic relations with the Republic of the Philippines and
vice versa that the laws of the adopter's country will acknowledge the
o Case of Stephanie Nathy Astorga: obiter was correct that Certificate of Adoption as valid, acknowledge the child as a legal
upon adoption, the adopted child remains an intestate child of child of the adopters, and allow entry of the child into such
the biological parent. country as an adoptee: Provided, further , That requirements of
o This case is no longer correct under the DAA and RA 116421. residency may be waived for the following:
The parental tie has been severed. (1) A former Filipino citizen, habitually residing in the
Philippines, who seeks to adopt a relative within the fourth
Succession (4th) civil degree of consanguinity or affinity; or
SECTION 43, RA 11642. Succession. — In testate and intestate (2) One who seeks to adopt the legitimate child of the Filipino
succession, the adopters and the adoptee shall have reciprocal rights spouse; or
of succession without distinction from legitimate filiations. However, (3) One who is married to a Filipino citizen and seeks to adopt
if the adoptees and their biological parents have left a will, the law on jointly with the spouse a relative within the fourth (4th)
testamentary succession shall govern. degree of consanguinity or affinity of the Filipino spouse.
 The adopted and adoptee are now compulsory and legal heirs of Spouses shall jointly adopt, except in the following cases:
each other without distinction. (a) If one spouse seeks to adopt the legitimate child of the other; or
o In the law of succession, they are considered parent and child. (b) If one spouse seeks to adopt own illegitimate child: Provided,
o In Succession, the biological parent shall cease to be the That the other spouse has signified consent thereto; or
parent of the child. (c) If the spouses are legally separated from each other.
 “However” -
Current Law DAA
Sir: Bartolome v. SSS: What happens to the child of both adopting Age Age has been raised to 25 No age
parents die during the minority of the adopted child? There’s no explicit But age gap was maintained requirement
provision under the new law. (legal age)
 In that case, relatives of the adopt were not obliged to support the Residence Longer residency requirement 3 years
adopted child because the relationship created by the adoption was Requirement (now 5 years) for foreigners
personal to the adopter. The adoptee was not entitled to receive
legal support from the relatives of the adopter. At the same time, Situation where the residency
the adoptee was no longer entitled to support from the biological requirement is maintained
parents, because their relationship was severed by the adoption. Joint adoption Same
 SC applied Section 2 of RA 8552 by analogy. All legal ties severed rules
by the adoption were restored upon the death of both adopting
parents. (a) Age Requirement
o See Section 53 of the current law. You don’t need to apply this Domestic Adoption
provision by analogy anymore. Because the adoptee is now  GR: Adoption must be of legal age and at least 16 years older
related to people other than the adoptee. than the adoptee.
 EXC: The age gap may be waived if:
SECTION 43, RA 11642. X o The adopter is the biological parent of the adoptee; OR
o The adopter is the spouse of the adoptee’s parent.
3. Who May Adopt?
Inter-country adoption
SECTION 21, RA 11642. Who May Adopt. — The following may  GR: The adopter must be at least 27 years old at the time of the
adopt: application and at least 16 years older than the child to be
(a) Any Filipino citizen at least twenty-five (25) years of age, who is adopted at the time of the application.
in possession of full civil capacity and legal rights; has not been  EXC:
convicted of any crime involving moral turpitude; is of good o The adopter is the parent by nature of the child to be adopted;
moral character and can model the same; is emotionally and OR
psychologically capable of caring for children; at least sixteen o The adopter is the spouse of the parent by nature of the
(16) years older than the adoptee; and who is in a position to child to be adopted.
support and care for adopted children in keeping with the means
(b) Requirement of joint adoption by spouses
 In Re: Petition for Adoption of Michelle Lim and Michael Jude o If successful: ICAB shall transmit a written consent for the
Lim: joint adoption by the husband and the wife is mandatory citing adoption to be executed by the DSWD (Section 48 ICAA IR)
Section 7(c), Article III of RA 8552 and Article 185 of the Family and the applicant files a petition for adoption in his/her country
Code. (Section 49 ICAA IR)
o The use of the word "shall" in the above-quoted provision
means that joint adoption by the husband and the wife is 5. Simulated Birth Rectification Act
mandatory.
o The requirement of joint adoption is still mandatory even if the (a) Benefit of Law
adoptee is already of legal age and already freed from Exemption from Liability
parental authority. To exempt from criminal, civil, and administrative liability those who
simulated the birth record of a child prior to the effectivity of RA 11222
(c) Exceptions to joint adoption (Section 7, DAA) and those who cooperated in the simulation.
(1) if one spouse seeks to adopt the legitimate son/daughter of
the other; or Conditions for Exemption (Section 4 RA 11222)
(2) if one spouse seeks to adopt his/her own illegitimate (1) the simulation of birth was made for the best interest of the child
son/daughter: Provided, However, that the other spouse has and that the child has been consistently considered and treated
signified his/her consent thereto; or by such person or persons as her, his, or their own daughter
(3) if the spouses are legally separated from each other. or son; AND
(2) Such person or persons has or have filed a petition for
 In the adoption of one’s own illegitimate child, the consent of the adoption with an application for the rectification of the simulated
other spouse is mandatory. birth record within 10 years from the effectivity of RA 11222. (March
o Castro v. Gregorio: In all instances where it appears that a 29, 2019)
spouse attempts to adopt a child out of wedlock, the other
spouse and other legitimate children must be personally (b) Administrative Adoption
notified through personal service of summons. It is not enough Requisites for Administrative Adoption
that they be deemed notified through constructive service. (1) the simulation of birth was made for the best interest of the child;
Otherwise, the court does not validly acquire jurisdiction over (2) the child has been consistently considered and treated by such
the proceedings and the decision is null and void. person or persons as her, his, or their own daughter or son;
(3) Such person or persons has or have filed a petition for adoption
4. Requirement of Supervised Custody with an application for the rectification of the simulated birth
record within 10 years from the effectivity of RA 11222;
Domestic Adoption (4) a certificate declaring the child legally available for adoption
 The temporary protective custody of the prospective adopter is (CDCLAA) is issued by the DSWD in favor of such child; AND
under the supervision of the court and shall last for a period of at (a) NOTE: The CDCLAA is no longer required if the adoptee
least 6 months, which may be reduced by the court motu proprio is already an adult or a relative of the adopter within the
or upon motion. fourth degree of consanguinity or affinity (Section 9 RA
o Adopter is alien: the law requires the competition of the 6- 11222)
month trial custody and may not be reduced (5) The child has been living with such person/s for at least three
o EXC: years before the effectivity of RA 11222.
 former Filipino citizen who seeks to adopt a relative (a) If this condition is not met, the adoption must be done
within the fourth (4th) degree of consanguinity or affinity; judicially.
or
 one who seeks to adopt the legitimate child of his Filipino Order of Adoption
spouse; or  Section 11 RA 11222: The petition for administrative adoption is
 one who is married to a Filipino citizen and seeks to filed before the DSWD and the Order of Adoption is issued by the
adopt jointly with his spouse a relative within the fourth DSWD Secretary.
(4th) degree of consanguinity or affinity of the Filipino o The order shall have the same effect as that of a decree of
spouse. adoption issued pursuant to the Domestic Adoption Act.
 Under the Foster Care Act of 2012 (RA 10165) o It shall take effect on the date the petition was filed with the
o In the case of the adoption of the foster child by the designated Office of the SWDO, even if the petitioner dies before the
foster parents, the trial custody may be partially waived to issuance.
the extent of the period equivalent to the period in which the
foster child has been under the care of the foster parents; 6. Effects of Domestic Adoption
PROVIDED, a harmonious relationship exists between the
foster child, foster parents, and where applicable, the foster ARTICLE 189, FC. Adoption shall have the following effects:
family. (Section 17, RA 10165, Rule 18.1, Article VI, IRR of (1) For civil purposes, the adopted shall be deemed to be a
RA 10165) legitimate child of the adopters and both shall acquire the
reciprocal rights and obligations arising from the relationship of
Inter-Country Adoption parent and child, including the right of the adopted to use the
 The process, which shall last for 6 months, takes place outside the surname of the adopters;
country and under the supervision of the foreign adoption (2) The parental authority of the parents by nature over the adopted
agency (Section 42, IR on ICAA) shall terminate and be vested in the adopters, except that if the
o If unsuccessful: the Inter-Country Adoption Board (ICAB) adopter is the spouse of the parent by nature of the adopted,
shall look for another prospective applicant. parental authority over the adopted shall be exercised jointly by
 Repatriation of the child is a last resort. (Sec. 47 ICAA both spouses; and
IR)
(3) The adopted shall remain an intestate heir of his parents and minor child living with them and over whom, the law
other blood relatives. presumes, the parents exercise supervision and control.
 Put a little differently, no presumption of parental
(a) Severance of Legal Ties dereliction on the part of the adopting parents may arise
if the adoptee is not in fact subject to their control at the
RULE: Unlike in the FC where only the parental authority of the time the tort was committed.
biological parent over the adopted is terminated and transferred in
favor of the adopters, the Domestic Adoption Act declares the severance (c) Successional Rights
of “all legal ties between the biological parents and the adoptee,”
including parental authority and their transfer in favor of the adopter, Effects in Succession by Law
except in cases where the biological parent is the spouse of the  In legal and intestate succession (which shall extend to compulsory
adopter. (Section 16 DAA) succession), the adopter(s) and the adoptee shall have reciprocal
 if the adopter is the spouse of the parent by nature of the adopted, rights of succession without distinction from legitimate filiation.
parental authority over the adopted shall be exercised jointly by (Section 18 DAA)
both spouses.
Effects in Succession by Will
Effect of Death of adopters during minority of adopted If the adoptee and his/her biological parent(s) had left a will, the law on
 When both the adopting parents die during the minority of the testamentary succession shall govern. (Section 18 DAA)
adopted (or incapacitated), all legal ties that had been severed
by the adoption decree between the biological parents and the Obiter Dictum (Bartolome v. SSS)
adopted are automatically restored. (Bartolome v. SSS)  Article 189(3) FC and Section 18, Article V RA 8552 (Law on
o Considering that adoption is a personal relationship and that Adoption): the adoptee remains an intestate heir of the
there are no collateral relatives by virtue of adoption, there biological parent.
shall be no one left to care for the minor adopted child. o The biological parents retain their rites of succession to
o Applies by analogy Section 20 DAA. the estate of the adoptee (Article 190[2] FC)
(b) Legitimacy (d) Right to Surname

 RULE: Section 17 DAA. Legitimacy. – The adoptee shall be Rule: FC and the Domestic Adoption Act categorically that the adopted
considered the legitimate son/daughter of the adopter(s) for all child has the right to use the surname of the adopter.
intents and purposes and as such is entitled to all the rights and  BUT the law which entitles the adopted minor to the use of the
obligations provided by law to legitimate sons/daughters born to surname of the adopter refers to the adopter’s own surname, and
them without discrimination of any kind. not to her surname acquired by marriage because adoption
creates a personal relationship only between the adopter and
Personal Relationship the adopted. (Valdez-Johnson v. Republic)
 The relationship established by the adoption is limited to the
adopting parents and does not extend to their other relatives, Adoption of Illegitimate Child by Biological Father
except as expressly provided by law. (Santos, Jr. v. Republic)  In Re: Adoption of Stephanie Nathy Astorga Garcia: Court
 Thus, the adopted child cannot be considered as a relative of the allowed an illegitimate child, upon adoption by her natural father, to
ascendants and collaterals of the adopting parents, nor of the use the surname of her natural mother as her middle name.
legitimate children which they may have after the adoption except There is no law prohibiting an illegitimate child adopted by her
that the law imposes certain impediments to marriage by reason of natural father to use as middle name her mother’s surname. This
adoption. will maintain her maternal lineage.
 Neither are the children of the adopted considered as
descendants of the adopter. Reverting Back to Previous Surname
 Republic v. CA and Wong: Court allowed an adopted child, after
Retroactive effects of decree of adoption the death of the adopting father, to drop the surname of the adopter
 RULE: Section 13 DAA: The decree of adoption shall be effective and use again the surname of the natural father. The use of the
as of the date the original petition was filed. This provision surname Wong embarrassed and isolated him from relatives and
shall also apply in case the petitioner(s) dies before the friends, as the same suggests a Chinese ancestry when in fact he
issuance of the decree of adoption to protect the interest of the is a Muslim Filipino residing in a Muslim community.
adoptee. o A change of name does not define a change in one’s existing
o Hence, for purposes that are beneficial to the interest of the family relations or in the rights and duties flowing therefrom. It
adoptee, the latter acquires the rights enjoyed by the does not alter one’s legal capacity, civil status or citizenship.
legitimate children as of the date of the filing of the What is altered is only the name.
petition for adoption and not only at the time of the issuance
of the adoption decree. (e) Issuance of Amended Birth Certificate
 Not applicable for purposes of vicarious liability Issuance of new birth certificate
o No retroactive effect may be given to the granting of the  The decree shall state the name by which the child is to be known.
petition for adoption for the purpose of imposing liability (Section 13 DAA)
upon the adopting parents accruing at a time when adopting  An amended certificate of birth shall be issued by the Civil Registry
parents had no actual or physically custody over the adopted attesting to the fact that the adoptee is the child of the adopter(s)
child. (Tamargo v. CA) by being registered with his/her surname. (Section 14 DAA)
 the basis of parental liability for the torts of a minor child  The original certificate of birth shall be stamped "cancelled" with
is the relationship existing between the parents and the the annotation of the issuance of an amended birth certificate in its
place and shall be sealed in the civil registry records. The new birth
certificate to be issued to the adoptee shall not bear any notation  Succession rights shall revert to its status prior to adoption, but only
that it is an amended issue. as of the date of judgment of judicial rescission. Vested rights
acquired prior to judicial rescission shall be respected.
Confidentiality of all records
 All records, books, and papers relating to the adoption cases in the R. Legal Support
files of the court, the DSWD, or any other agency or institution
participating in the adoption proceedings shall be kept strictly 1. Basic Principles in Support
confidential.
 The court order its release under the following conditions: Definition
o The disclosure of the information to a third person is ARTICLE 194, FC. Support comprises everything indispensable for
necessary for purposes connected with or arising out of the sustenance, dwelling, clothing, medical attendance, education and
adoption transportation, in keeping with the financial capacity of the family.
o The disclosure will be for the best interest of the adoptee
o The court may restrict the purposes for which it may be used. The education of the person entitled to be supported referred to in
the preceding paragraph shall include his schooling or training for
(f) Adoption decree cannot be collaterally attacked some profession, trade or vocation, even beyond the age of majority.
 Filiation cannot be unilaterally attacked (Reyes v. Mauricio) Transportation shall include expenses in going to and from school, or
o The same rule applies to adoption. to and from place of work.
 Reyes v. Sotero: Adoption cannot be assailed collaterally in a
proceeding for the settlement of a decedent’s estate.  Legal support, also known as family support, is that which is
 Austria v. Reyes: The legality of the adoption by the testatrix can provided by law, comprising everything indispensable for
be assailed only in a separate action brought for that purpose and sustenance, dwelling, clothing, medical attendance, education and
cannot be subject to collateral attack. transportation, in keeping with the financial capacity of the family.
(Patricio v. Dario III)
7. Rescission of Adoption Decree  The education of the person entitled to be supported referred to in
the preceding paragraph shall include his schooling or training for
(a) Who may rescind? some profession, trade or vocation, even beyond the age of
 Lahom v. Sibulo: The Domestic Adoption Act withdrew the right majority. Transportation shall include expenses in going to and
of an adopter to rescind the adoption decree and gave to the from school, or to and from place of work.
adopted child the sole right to sever the legal ties created by
adoption. Who are obliged to support each other
o An adopter, while barred from severing the legal ties of ARTICLE 195, FC. Subject to the provisions of the succeeding
adoption, can always for valid reasons cause the forfeiture of articles, the following are obliged to support each other to the whole
certain benefits otherwise accruing to an undeserving child. extent set forth in the preceding article:
For instance, upon the grounds recognized by law, an adopter (1) The spouses;
may deny to an adopted child his legitime and, by a will and (2) Legitimate ascendants and descendants;
testament, may freely exclude him from having a share in the (3) Parents and their legitimate children and the legitimate and
disposable portion of his estate. illegitimate children of the latter;
(4) Parents and their illegitimate children and the legitimate and
(b) Grounds for Rescission illegitimate children of the latter; and
SECTION 19, DAA. Adoption shall have the following effects: (5) Legitimate brothers and sisters, whether of full or half-blood.
(1) repeated physical and verbal maltreatment by the adopter(s)
despite having undergone counseling; ARTICLE 196, FC. Brothers and sisters not legitimately related,
(2) attempt on the life of the adoptee; whether of the full or half-blood, are likewise bound to support each
(3) sexual assault or violence; or other to the full extent set forth in Article 194, except only when the
(4) abandonment and failure to comply with parental obligations. need for support of the brother or sister, being of age, is due to a
cause imputable to the claimant’s fault or negligence.
(c) Prescriptive Period
Section 21, Rule on Adoption: ARTICLE 198, FC. During the proceedings for legal separation or for
 If incapacitated, adoptee must file the petition for rescission or annulment of marriage, and for declaration of nullity of marriage, the
revocation of adoption within five (5) years after he reaches spouses and their children shall be supported from the properties of
the age of majority, or the absolute community or the conjugal partnership. After the final
 if he was incompetent at the time of the adoption, within five (5) judgment granting the petition, the obligation of mutual support
years after recovery from such incompetency. between the spouses ceases. However, in case of legal separation,
the court may order that the guilty spouse shall give support to the
(d) Effects of Rescission (Section 20 DAA) innocent one, specifying the terms of such order.
 the parental authority of the adoptee's biological parent(s), if
known, or the legal custody of the DSWD shall be restored if (a) The spouses
the adoptee is still a minor or incapacitated.  Spouse must be the legitimate spouse. (Santero v. CFI-Cavite)
 The reciprocal rights and obligations of the adopter(s) and the  If the marriage is void, the parties are not actually spouses. No
adoptee to each other shall be extinguished. obligation to support each other. The absolute nullity of the
 The court shall order the Civil Registrar to cancel the amended marriage can be resolved by the court in the action for support.
certificate of birth of the adoptee and restore his/her original birth  Adultery of the wife is a valid defense in an action for support.
certificate. (Reyes v. Ines-Luciano)
o If both are equally at fault, the principle of in pari delicto However, in case of urgent need and by special circumstances,
applies. The husband cannot avail of the defense of adultery. the judge may order only one of them to furnish the support
(Almacen v. Baltazar) provisionally, without prejudice to his right to claim from the other
o After the final judgment granting the petition (in legal obligors the share due from them.
separation, annulment, declaration of nullity), the obligation of
mutual support between the spouses ceases. However, When two or more recipients at the same time claim support from
the court may order that the guilty spouse shall give one and the same person legally obliged to give it, should the latter
support to the innocent one. not have sufficient means to satisfy all claims, the order established
in the preceding article shall be followed, unless the concurrent
(b) Legitimate ascendants and descendants obligees should be the spouse and a child subject to parental
authority, in which case the child shall be preferred.
(c) Parents and their children (legitimate and illegitimate) and the
children of the latter (legitimate and illegitimate) 2. Payment of Support
 The prohibition under the barrier rule in succession by operation
of law in Article 992 NCC does not apply to legal support. Amount of support
 BUT illegitimate filiation must be established. ARTICLE 201, FC. The amount of support, in the cases referred to
 in Articles 195 and 196, shall be in proportion to the resources or
(d) Legitimate brothers and sisters, whether of full or half-blood means of the giver and to the necessities of the recipient.
(e) Brothers not legitimately related ARTICLE 202, FC. Support in the cases referred to in the preceding
 The right to support of an illegitimate sibling ceases when the need article shall be reduced or increased proportionately, according to the
for support of an illegitimate brother or sister, who is of legal age, reduction or increase of the necessities of the recipient and the
is due to a cause imputable to his/her fault or negligence. resources or means of the person obliged to furnish the same.
(Article 196 FC)
 Hence, any judgment granting support never becomes final and
Basis of legal support is always subject to modification, depending on the needs of the
 The issue of legal support depends on the relationship in Articles child and capabilities of the parents to give support. (Lam v. Chua,
195 and 196. It is not dependent on parental authority. Montefalcon v. Vasquez)
o Includes adoptive children under the new law, RA 11642
 Support and parental authority are distinct concepts. When demandable
 As consequences: ARTICLE 203, FC. The obligation to give support shall be
o A child, who is not financially capable, is still entitled to demandable from the time the person who has a right to receive
legal support even if he is already emancipated and freed the same needs it for maintenance, but it shall not be paid except
from the parent’s parental authority. from the date of judicial or extra-judicial demand.
o An illegitimate father whose filiation to the illegitimate XXX
child has been duly established is liable to support the
latter even if he has no parental authority over the child. Support must be demanded and right to it established before it becomes
o The grandparents are liable to support their payable, for the right to support does not arise from the relationship
grandchildren even if the parents are still exercising of parents and children, but from imperative necessity without which it
parental authority over the latter, if such parents do not have cannot be demanded, and the law presumes that such necessity does
the financial capability to support the children. not exist unless support is demanded. (Sy v. CA)
 Lim v. Lim: the obligation to provide legal support passes on
to ascendants not only upon default of the parents but also for the Manner of Payment
latter’s inability to provide sufficient support. ARTICLE 204, FC. The person obliged to give support shall have
o Ordinarily, the obligation to give support rests principally on the option to fulfill the obligation either by paying the allowance fixed,
those more closely related to the recipient. However, the or by receiving and maintaining in the family dwelling the person who
more remote relatives may be held to shoulder the has a right to receive support. The latter alternative cannot be availed
responsibility should the claimant prove that those who are of in case there is a moral or legal obstacle thereto.
called upon to provide support do not have the means to do
so. (Mangonon v. CA) Two ways:
(1) by paying the allowance fixed, or
Order of liability for support (2) by receiving and maintaining in the family dwelling the person who
ARTICLE 199, FC. Whenever two or more persons are obliged to has a right to receive support.
give support, the liability shall devolve upon the following persons o This is not available if there’s a moral or legal obstacle.
in the order herein provided:
(1) The spouse; Legal Obstacle: Illegitimate father cannot choose option 2 in providing
(2) The descendants in the nearest degree; support for his illegitimate child. He cannot obtain custody over the child.
(3) The ascendants in the nearest degree; and An illegitimate child is under the sole parental authority of the mother.
(4) The brothers and sisters.
Moral Obstacle:
ARTICLE 200, FC. When the obligation to give support falls upon  Lim v. Lim: Husband is not financially able to support the family.
two or more persons, the payment of the same shall be divided The wife and the two minor children live with the parents of the
between them in proportion to the resources of each. husband. The wife caught the husband cheating in the house of the
parents of the husband. The wife filed an action for support against
the paternal grandparents.
o Parents chose option 2. SC said this cannot be availed of Susceptibility to Cannot be compensated If the claim for
because there’s a moral obstacle. The two minor children compensation with what the recipient support is by
were with their mother. Forcing the children to go to the owes the obligor. (Article gratuitous title,
husband, would be like forcing the wife to return to the 1287 paragraph 2 NCC) compensation may
husband, where the infidelity took place. not even be set up.
 Strained relations between the grandparents and grandchildren.
Grandparents denied the grandchildren were related to them in a S. Parental Authority
case for support.
o Grandparents asked the grandchildren to return home from 1. Basic Principles in Parental Authority
the US where they will be supported. SC said there was a
moral obstacle: strained relations. Concept
 Parental authority or patria potestas in Roman Law is the juridical
As consequences: institution whereby parents rightfully assume control and protection
 An illegitimate father cannot choose the second option. of their unemancipated children to the extent required by the latter's
o There is a legal obstacle. needs. It is a mass of rights and obligations which the law grants to
o Under the law, an illegitimate child shall be under the parental parents for the purpose of the children's physical preservation and
authority and custody of the mother. (Article 176; Briones v. development, as well as the cultivation of their intellect and the
Miguel) education of their heart and senses. (Masbate v. Reclucio)
o The illegitimate father is not entitled to the child’s custody,  The rights of the parents are ancillary to the property discharge
even if he admits paternity. of parental duties to children under parental authority. (Medina v.
 A legal or moral obstacle also exists when the relations between Makabali)
the grandparents and grandchildren were already strained due
to the filing of the suit for declaration of legitimacy and support and Over whom parental authority is exercised
denial by the grandfather of familial relationship with the ARTICLE 209, FC. Pursuant to the natural right and duty of parents
grandchildren. (Mangonon v. CA) over the person and property of their unemancipated children,
 When the wife is entitled to separate maintenance or is justified parental authority and responsibility shall include the caring for and
to live separately from the husband, the second option is not rearing them for civic consciousness and efficiency and the
available. development of their moral, mental and physical character and well-
o Ex. Wife and the minor children left the house of the in-laws being.
where they were then living when she caught her husband in
a “very compromising situation” with the in-house midwife of  GR: Parental authority is exercised over unemancipated or minor
the mother-in-law. (Lim v. Lim) children and his property.
 EXC: Parental authority exists even after minority:
3. Distinctions Between Legal and Contractual Support o ARTICLE 45(1) FC: in the marriage of a party at least 18 but
below 21, where parental consent is still necessary.
Legal Support Contractual o ARTICLE 78 FC: in the marriage settlement of a party below
Support 21 but at least 18, the person whose consent to the marriage
As to Concept That which The excess in is required under Article 14 FC is also required to be a party
is indispensable for amount beyond that to the settlement; otherwise, the marriage settlement is NOT
sustenance, dwelling, required for legal VALID.
clothing, medical support, in addition to o ARTICLE 2180 NCC in relation to ARTICLE 236 FC: the
attendance, education that which is given in parents shall continue to be vicariously liable for quasi
and transportation, in a contract or in a last delict committed by their children at least 18 but below 21,
keeping with the financial will and testament. provided that the latter are living in their company.
capacity of the family.
Susceptibility to The right to support is a Subject to levy on Renunciation and transfer of parental authority
Attachment purely personal right attachment or  GENERAL RULE
essential to the life of the execution. ARTICLE 210, FC. Parental authority and responsibility may not be
recipient, so that it renounced or transferred except in the cases authorized by law.
cannot be subject to o NO WAIVER, RENUNCIATION, OR TRANSFER
attachment or o THUS: When a parent entrusts the custody of a minor to
execution. another, such as a friend or godfather, even in a document,
Susceptibility to Neither can it be The right to receive what is given is merely temporary custody and it does not
renunciation renounced or transmitted contractual support constitute a renunciation of parental authority. (Santos, Sr. v.
to a third person. can be renounced or CA, Sagala-Eslao v. CA)
waived and can be  EXC: Renunciation or transfer of parental authority is valid in:
transmitted to a third o Adoption (Article 189[1] FC)
person. o Guardianship (Sagala-Eslao v. CA)
Susceptibility to The right to receive The right to receive o Voluntary and involuntary commitment of a child to the DSWD
compromise future support cannot be contractual support or any duly-licensed child placement agency or individual
agreement the subject of can be the subject (Article 154, 142, PD 603 / Child and Youth Welfare Code)
compromise. (Article matter of a o There is a need to impose disciplinary measures pursuant
2035 NCC) compromise to Articles 223 and 224 FC
agreement. o When a child (foster child) is placed under the care of foster
parents pursuant to RA 10165 (Article 6, RA 10165)
No child under seven years of age shall be separated from the

Why? Parental authority consists of obligations. mother unless the court finds compelling reasons to order
Who exercises parental authority? otherwise.
Legitimate BOTH PARENTS
children  GR: Joint exercise of parental authority IF  The law presumes the mother is the best custodian. (Espiritu v. CA)
THE PARENTS ARE STILL LIVING o Tender-age Presumption Rule: no child under seven years
TOGETHER of age shall be separated from the mother unless the court
 In case of disagreement, decision of the finds compelling reasons to order otherwise.
husband prevails  Applicable only when the minor child is legitimate.
o the wife may seek relief from the court  Otherwise, he/she is always under the parental authority
 In case of separation (de facto, legal, or an and custody of the mother regardless of age (Article 176
offshoot of annulment proceedings or FC)
declaration of the nullity of the marriage  Masbate v. Relucio: The tender-age presumption rule applies
under 56 and 53) – Article 213 applies. whether the child is legitimate or illegitimate.
o Can the parents enter into agreement o Pablo-Gualberto v. Gualberto is the better rule.
on joint parental authority in case of o Article 213 is applicable only to legitimate children.
separation? o If the child is illegitimate, Article 176 FC governs. Paragraph
 If the child is below 7, 213(2) is 2 Article 213 FC is only a continuation of the first paragraph of
mandatory. The child shall not be the article.
separated from the mother. Any  Dacasin v. Dacasin: the statutory awarding of sole parental
agreement to the contrary is void. custody to the mother under Article 213 paragraph 2 is mandatory.
(Dacasin) Any agreement to the contrary is void.
 Otherwise, the agreement is valid. o SC declared void a compromise agreement providing for joint
o In case of disagreement, court. custody of a child below 7 years old.
 The court must choose between
the parents. (2) Compelling reasons
Illegitimate child Article 176: ONLY THE MOTHER The mother may be deprived of custody of a child below 7 years old.
 Neglect and abandonment (Medina v. Mabakali)
2. Parental Authority Over Legitimate Children  Unemployment and immorality (Cervantez v. Fajardo)
 Habitual drunkenness (Perez v. CA)
Governing law  Drug addiction, maltreatment of the child, insanity, and being sick
 Articles 211-213 FC with a communicable disease (Perez v. CA)
Parental Preference Rule To deprive the wife of custody, the husband must clearly establish
ARTICLE 212, FC. In case of absence or death of either parent, the that her moral lapses have had an adverse effect on the welfare of
parent present shall continue exercising parental authority. The the child or have distracted the offending spouse from exercising proper
remarriage of the surviving parent shall not affect the parental parental care. (Pablo-Gualberto)
authority over the children, unless the court appoints another
person to be the guardian of the person or property of the children. When is the mother deprived of custody?
 Adverse effect upon the growth of the child
 Parents are placed first in rank in matters of parental authority. o Ex. If the mother is a prostitute, if the child is unaware, it’s not
 Under this rule, in case of death, absence or unsuitability of either sufficient ground to declare the mother unfit.
parent, the parent present and suitable shall continue to exercise  Actions result in neglect of the parental duties to the child
parental authority.
 Remarriage of the surviving parent shall not affect parental (3) If child is at least seven
authority, unless the court appoints another.  Parental authority shall be exercised by the parent designated by
the Court. (Article 213 FC)
Joint Exercise of Parental Authority o Only consideration: BEST INTEREST OF THE CHILD
ARTICLE 211, FC. The father and the mother shall jointly exercise o The non-custodial parent will not be entitled to exercise
parental authority over the persons of their common children. In parental authority.
case of disagreement, the father’s decision shall prevail, unless o BUT separation is not a ground to terminate parental
there is a judicial order to the contrary. authority.
 In all controversies regarding the custody of minors, the sole and
Children shall always observe respect and reverence towards their foremost consideration is the physical, educational, social and
parents and are obliged to obey them as long as the children are moral welfare of the child concerned, taking into account the
under parental authority. respective resources and social and moral situations of the
contending parents. (Sy v. CA)
Rule in Case of Separation of Parents
(1) If the child below seven (4) Visitation rights
ARTICLE 213, FC. In case of separation of the parents, parental The non-custodial parent is entitled to visitation rights. (Silva v. CA)
authority shall be exercised by the parent designated by the Court. If hihingin yung bata every weekend, this is not visitation. This is custody.
The Court shall take into account all relevant considerations, This cannot be granted in court.
especially the choice of the child over seven years of age, unless the
parent chosen is unfit. (5) No res judicata in custody cases
 the matter of custody "is not permanent and unalterable and can (a) Concepcion v. CA
always be re-examined and adjusted."  The child was conceived and born in a bigamous second
o Cannot be accorded the force end effect of res judicata. marriage contracted by the wife during the pendency of her
(Becket v. Sarmiento, Jr.) previous marriage. At the time of the child’s birth, the prior marriage
o At any time, circumstances could change that the best interest remained subsisting. The child was declared to be a legitimate
of the child is no longer with the chosen parent. child of the first marriage applying the presumption of legitimacy
under Article 164 FC.
3. Parental Authority Over Illegitimate Child o Consequently, the second husband was denied visitation
right because of the absence of parent-child relationship, the
Governing Law child being presumed to be a legitimate child of the first
ARTICLE 176, FC. Illegitimate children shall use the surname and husband.
shall be under the parental authority of their mother, and shall be (b) If the biological father of the illegitimate child consented to the
entitled to support in conformity with this Code. However, illegitimate adoption of the child by the biological mother and the latter’s
children may use the surname of their father if their filiation has spouse, the biological father will lose his visitation right
been expressly recognized by the father through the record of because the legal tie between him and the child is severed by the
birth appearing in the civil register, or when an admission in a public decree of adoption.
document or private handwritten instrument is made by the
father. Provided, the father has the right to institute an action before When Illegitimate Father Entitled to Child’s Custody
the regular courts to prove non-filiation during his lifetime. The  The illegitimate father may possibly be entitled to have custody
legitime of each illegitimate child shall consist of one-half of the over an illegitimate child if he is entitled to exercise substitute
legitime of a legitimate child. parental authority under Article 216 FC by being the child’s
actual custodian, which presupposes the default of the
 Article 176 FC following persons:
 Masbate v. Relucio: The tender-age presumption rule applies o Child’s mother (dead, absent, or unfit)
whether the child is legitimate or illegitimate. o Child’s maternal grandparents
o Pablo-Gualberto v. Gualberto is the better rule. o Brother or sister over the age of 21
o Article 213 is applicable only to legitimate children.
o If the child is illegitimate, Article 176 FC governs. There must be CUSTODY + DEFAULT
Paragraph 2 Article 213 FC is only a continuation of the first
paragraph of the article. 4. Substitute Parental Authority
o Even under Article 176, the illegitimate mother may be shown
to be unfit to have custody because primary consideration is Concept
the best welfare of the child. ARTICLE 214, FC. In case of death, absence or unsuitability of the
parents, substitute parental authority shall be exercised by the
Mother’s Sole Parental Authority surviving grandparent. In case several survive, the one
 Insofar as illegitimate children are concerned, Article 176 FC states designated by the court, taking into account the same
that illegitimate children shall be under the parental authority consideration mentioned in the preceding article, shall exercise the
of their mother. authority.
o Accordingly, mothers are entitled to the sole parental authority
of their illegitimate children, notwithstanding the father's ARTICLE 216, FC. In default of parents or a judicially appointed
recognition of the child. guardian, the following person shall exercise substitute parental
o In the exercise of that authority, mothers are entitled to keep authority over the child in the order indicated:
their illegitimate children in their company, and the Court will (1) The surviving grandparent, as provided in Art. 214;
not deprive them of custody, absent any imperative cause (2) The oldest brother or sister, over twenty-one years of age,
showing the mother's unfitness to exercise such authority unless unfit or disqualified; and
and care. (Masbate v. Reclucio) (3) The child’s actual custodian, over twenty-one years of age,
unless unfit or disqualified.
Effect of Admission of Paternity
This is not a ground to give him custody but a ground only: (Article Whenever the appointment or a judicial guardian over the property of
176 FC) the child becomes necessary, the same order of preference shall be
 To order him to give support to the child; and observed.
 To authorize the child to use the father’s surname, if the
acknowledgement of paternity is in writing or made in the birth Concept: BOTH PARENTS ARE DEAD
certificate. It is the parental authority which the persons designated by law may
exercise over the persons designated by law may exercise over the
Since the father has no parental authority and is not entitled to custody, persons and property of unemancipated children in case of death,
he cannot demand, as a matter of right, to be granted joint custody absence, or unsuitability of both parents, or in default of a judicially
over the minor illegitimate child. appointed guardian.
Visitation Rights Who may exercise substitute parental authority?

 The illegitimate father is entitled to visitation rights. In the order indicated:
 To be entitled to the constitutionally-protected inherent and natural (1) Surviving grandparent
right of a parent to have access to his/her child (visitation rights), o If several survive, the one designated by the court, taking into
there must be parent-child relationship between them. account all relevant considerations, especially the choice of
(Concepcion v. CA) the child over seven years old (Article 214 in relation to Article
213, paragraph 1 FC)
o In case of IC: only the MATERNAL SIDE is considered for damages caused by the acts or omissions of the
(2) The oldest brother or sister unemancipated minor. The parents, judicial guardians or the
o Over 21 years old persons exercising substitute parental authority over said
o Unless unfit or disqualified minor shall be subsidiarily liable.
(3) The child’s actual custodian
o Over 21 years old The respective liabilities of those referred to in the preceding
o Unless unfit or disqualified. paragraph shall not apply if it is proved that they exercised the proper
(4) In case of foundlings, abandoned, neglected, or abused diligence required under the particular circumstances.
children and other children similarly situated, parental authority
shall be entrusted in summary judicial proceedings to: All other cases not covered by this and the preceding articles shall
o Heads of children’s homes, orphanages, and similar be governed by the provisions of the Civil Code on quasi-delicts.
institutions duly accredited by the proper government agency.
 Special – solidary liability
ARTICLE 217, FC. In case of foundlings, abandoned neglected or  Substitute – subsidiary liability
abused children and other children similarly situated, parental
authority shall be entrusted in summary judicial proceedings to GR: If a minor causes damage to another while he/she is under special
heads of children’s homes, orphanages and similar institutions duly parental authority, the liability shall be borne by:
accredited by the proper government agency.  the persons given special parental authority shall be principally
and solidarily liable for such damages.
Under the Foster Care Act of 2012 (RA 10165)  parents, judicial guardians or the persons exercising substitute
 Section 6. Parental Authority of a Foster Parent. – Foster parents parental authority over said minor shall be subsidiarily liable.
shall have the rights, duties and liabilities of persons exercising
substitute parental authority, as may be provided under the EXC: it is proved that they exercised the proper diligence required
Family Code over the children under their foster care. under the particular circumstances
 Section 7. Limitations on Parental Authority of Foster Parents. –
Foster parents shall only have the rights of a person with 6. Effect of Parental Authority Upon Persons of Children
special parental authority to discipline the foster children as
defined under Section 233 of the Family Code, insofar as it ARTICLE 220, FC. The parents and those exercising parental
prohibits the infliction of corporal punishment upon the child. authority shall have with the respect to their unemancipated children
o Infliction of corporal punishment by the foster parents shall be on wards the following rights and duties:
ground for revocation of the Foster Family Care License (1) To keep them in their company, to support, educate and instruct
and termination of Foster Placement Authority. them by right precept and good example, and to provide for their
upbringing in keeping with their means;
Even if the illegitimate father is not granted parental authority, in the (2) To give them love and affection, advice and counsel,
absence of the child’s mother and maternal grandparents, the child’s companionship and understanding;
father may be entitled to custody if he is the actual custodion. (3) To provide them with moral and spiritual guidance, inculcate in
them honesty, integrity, self-discipline, self-reliance, industry
5. Special Parental Authority and thrift, stimulate their interest in civic affairs, and inspire in
them compliance with the duties of citizenship;
Concept: It is the parental authority granted by law to certain persons, (4) To furnish them with good and wholesome educational
entities, or institutions in view of their special relation to children under materials, supervise their activities, recreation and association
their “supervision, instruction, or custody.” with others, protect them from bad company, and prevent them
from acquiring habits detrimental to their health, studies and
Scope of Special Parental Authority morals;
 Article 218, paragraph 2 FC: Authority and responsibility shall (5) To represent them in all matters affecting their interests;
apply to all authorized activities whether inside or outside the (6) To demand from them respect and obedience;
premises of the school, entity or institution. (7) To impose discipline on them as may be required under the
 Applies to field trips, excursions and other affairs of the pupils and circumstances; and
students outside the school premises whenever authorized by the (8) To perform such other duties as are imposed by law upon
school or its teachers. parents and guardians.
Who may exercise special parental authority? Right to Custody

ARTICLE 218 paragraph 1, FC. The school, its administrators  This is a natural right incident to parenthood (Sagala-Eslao),
and teachers, or the individual, entity or institution engaged in which is also enshrined under Article 220 FC.
child care shall have special parental authority and responsibility  In consideration of the child’s welfare and well-being (not merely
over the minor child while under their supervision, instruction or material comfort) the custody of a minor may be given to a non-
custody. relative as against the mother. (Medina v. Makabali)
(1) School
(2) School administrators Duty to provide support and education
(3) School teachers,  Parental authority is not the basis of this obligation but the family
(4) the individual, entity or institution engaged in child care ties or relationships recognized by law in Article 195 and 196 FC.
 The obligation of the parents to provide support is not co-terminus
Civil liability for quasi-delict with the exercise of parental authority.
ARTICLE 219, FC. Those given the authority and responsibility o The education of the person entitled to be supported referred
under the preceding Article shall be principally and solidarily liable to in the preceding paragraph shall include his schooling or
training for some profession, trade or vocation, even beyond (i) Bongalon v. People: Not every instance of the laying of
the age of majority. Transportation shall include expenses in hands on a child constitutes the crime of child abuse.
going to and from school, or to and from place of work. Only when the laying of hands is shown beyond
 A parent who fails or refuses to do his part in providing his child the reasonable doubt to be intended by the accused to
education his station in life and financial condition permit can be debase, degrade, or demean the intrinsic worth and
charged with neglect of child under Article 59(4) PD 603. dignity of the child as a human being should it be
o But he cannot be charged with violation of Section 10(a) of RA punished as child abuse. Otherwise, it is punished under
7610 (Child Abuse). Said provision expressly penalizes any the RPC.
person who commits other acts of neglect, child abuse, (2) Those exercising parental authority may petition the court for the
cruelty, or exploitation or be responsible for other conditions imposition of appropriate disciplinary measures upon the child,
prejudicial to the child’s development including those covered which may include the commitment of the child in entities or
by Article 59 PD 603 “but not covered by the RPC.” intuitions engaged in child care in children’s homes duly accredited
o The “neglect of child” punished under Section 59(4) PD 603 is by the proper government agency.
also a crime (known as “indifference of parents”) penalized (a) Commitment must not exceed 30 days.
under Article 277 paragraph 2 RPC. (3) The law prohibits those exercising special parental authority from
o Hence it is excluded from RA 7610. inflicting corporal punishment upon the child.
(a) Article 233, paragraph 2: In no case shall the school
Duty of Representation administrator, teacher of individual engaged in child care
 Parents are duty-bound to represent their unemancipated children exercising special parental authority inflict corporal
in all matters affecting their interests. (Article 220. punishment upon the child.
o Extends to representation in court litigation (Section 5, Rule 3, (b) Under the Foster Care Act of 2012, the designated foster
1997 Rules of Civil Procedure) parents shall have the rights, duties and liabilities of persons
o But when the best interests of the child so require, the court exercising substitute parental authority, as may be provided
may appoint a guardian ad litem to represent the minor. under the FC over the children under their foster care. They
ARTICLE 222, FC. The courts may appoint a guardian of the child’s shall only have the rights of a person with special parental
property or a guardian ad litem when the best interests of the child authority to discipline the foster children as defined under
so requires. Section 233 FC, insofar as it prohibits the infliction of
corporal punishment upon the child.
Duty to give or withhold consent (i) Infliction of corporal punishment by the foster parents
 May extend beyond the age of majority shall be ground for revocation of the Foster Family
o Parental consent is necessary if a party to the marriage is Care License and termination of Foster Placement
between 18 and 21 years old. The parent is also required to Authority.
be a party to the marriage settlement, if one is to be executed. (4) SPARK v. Quezon City: An association of young adults and
 Imbong v. Ochoa, Jr.: SC declared unconstitutional Section 7 of minors that aims to forward a free and just society, called SPARK,
RA 10354 (RH Law) and the corresponding provision in the RH- questioned the constitutionality of the curfew ordinances of QC,
IRR, which allow minor-parents or minors who have suffered a Navitas, and Manila on the ground that it violates the
miscarriage access to modern methods of family planning constitutional right of parents to rear their children.
without written consent from their parents or guardian/s. o SC recognized that the State, as parens patriae, has the
o It is an affront to the constitutional mandate to protect and inherent right and duty to aid parents in the moral
strengthen the family as an inviolable social institution, as the development of their children and that the Curfew
State cannot replace the child’s natural mother and father Ordinances were examples of legal restrictions designed to
when it comes to providing the child’s needs and comfort. aid parents in their role of promoting their children’s well-
o THUS: to say their consent is no longer relevant is anti- being.
family. o The ordinances apply only when the minors are not
 Section 23(a)(2)(ii) of the RH Law was declared unconstitutional accompanied by their parents. As such, the only aspect of
because it limits the requirement of parental consent to “only in parenting that the ordinances affect is the parents’ prerogative
elective surgical procedures,” and denies the parents their right of to allow minors to remain in public places without parental
parental authority in cases where what is involved are “non-surgical accompaniment during the curfew hours.
o The ordinances amount to a minimal—albeit reasonable—
procedures.”
o The parents should not be deprived of their constitutional right infringement upon a parent’s right to bring up his/her child.
of parental authority for this would be an affront to the
constitutional mandate to protect and strengthen the family. ARTICLE 223, FC. The parents or, in their absence or incapacity, the
individual, entity or institution exercising parental authority, may
Right to discipline child petition the proper court of the place where the child resides, for an
(1) The FC authorizes those exercising parental authority “to impose order providing for disciplinary measures over the child. The child
discipline on (minor children) as may be required under the shall be entitled to the assistance of counsel, either of his choice or
circumstances,” but the law must not be interpretated to appointed by the court, and a summary hearing shall be conducted
authorize punishments beyond moderate ones: wherein the petitioner and the child shall be heard.
(a) Parental authority may be suspended, upon proper petition to
the court, if the parent or person exercising parental authority However, if in the same proceeding the court finds the petitioner at
“treats the child with excessive harshness or cruelty.” fault, irrespective of the merits of the petition, or when the
(Article 231[1] FC) circumstances so warrant, the court may also order the deprivation
(b) The parent may be held criminally liable for violation of RA or suspension of parental authority or adopt such other measures as
7610 (Special Protection Against Abuse, Exploitation and it may deem just and proper.
Discrimination Act), if he/she employs excessive harshness or
cruelty upon the child.
ARTICLE 224, FC. The measures referred to in the preceding article ARTICLE 226, FC. The property of the unemancipated child earned
may include the commitment of the child for not more than thirty or acquired with his work or industry or by onerous or gratuitous title
days in entities or institutions engaged in child care or in shall belong to the child in ownership and shall be devoted
children’s homes duly accredited by the proper government agency. exclusively to the latter’s support and education, unless the title or
transfer provides otherwise.
The parent exercising parental authority shall not interfere with
the care of the child whenever committed but shall provide for his The right of the parents over the fruits and income of the child’s
support. Upon proper petition or at its own instance, the court may property shall be limited primarily to the child’s support and
terminate the commitment of the child whenever just and proper. secondarily to the collective daily needs of the family.
7. Effect of Parental Authority upon Property of Children  GR: The property of the unemancipated child earned or acquired
with his work or industry or by onerous or gratuitous title shall
Legal guardianship over property of minor children belong to the child in ownership and shall be devoted exclusively
ARTICLE 225, FC. The father and the mother shall jointly to the latter’s support and education, unless the title or transfer
exercise legal guardianship over the property of the provides otherwise
unemancipated common child without the necessity of a court  The parents have the right to use only the “fruits and income” of
appointment. In case of disagreement, the father’s decision shall said property for the following:
prevail, unless there is a judicial order to the contrary. o Primarily: child’s support
o Secondarily: collective needs of the family.
Where the market value of the property or the annual income of the
child exceeds P50,000, the parent concerned shall be required to Rule on disposition or encumbrance of child’s property
furnish a bond in such amount as the court may determine, but not  While the parents have the right to administer the property of their
less than ten per centum (10%) of the value of the property or minor children, such right does not include the power to dispose
annual income, to guarantee the performance of the obligations or encumber without court authorization.
prescribed for general guardians.  Administration includes all acts for the preservation of the
property and the receipt of fruits according to the natural purpose
A verified petition for approval of the bond shall be filed in the proper of the thing.
court of the place where the child resides, or, if the child resides in a o Any act of disposition or alienation, or any reduction in
foreign country, in the proper court of the place where the property or the substance of the patrimony of child, exceeds the limits
any part thereof is situated. of administration. (Neri v. Heirs of Uy)
o Thus, a father or mother, as the natural guardian of the minor
The petition shall be docketed as a summary special proceeding under parental authority, does not have the power to dispose
in which all incidents and issues regarding the performance of the or encumber the property of the latter. Such power is
obligations referred to in the second paragraph of this Article shall be granted by law only to a judicial guardian of the ward’s
heard and resolved. property and even then only with courts’ prior approval
secured in accordance with the proceedings set forth by the
The ordinary rules on guardianship shall be merely suppletory except Rules of Court.
when the child is under substitute parental authority, or the guardian o Any disposition or encumbrance by the parent without
is a stranger, or a parent has remarried, in which case the ordinary proper judicial authority, unless ratified by the child upon
rules on guardianship shall apply. reaching the age of majority, is unenforceable in
 RULE: The father and the mother shall jointly exercise legal accordance with Articles 1317 and 1403(1) NCC.
guardianship over the property of the unemancipated common
child without the necessity of a court appointment. Rule on lease of property belonging to minor children
o Court may appoint a guardian of the child’s property when  GR: Parents, as legal guardian of the minor’s property, may validly
the best interests of the child so requires. (Article 222) lease the same without court authorization because lease is an
 When Bond Required act of administration.
o Law requires the parent concerned to post a bond if the  EXC
market value of the property or annual income of the child o If the lease will be recorded in the Registry of Property,
exceeds P50K. the same should be made only after obtaining court
 Bond shall not be less than 10% of the value of the authorization. (Article 1647 NCC)
property or annual income. o Same rule if the lease is for a period of more than one year
 Rule when child represented disinherited or incapacitated because this is already deemed as an act of dominion. (Article
parent 1878(8) NCC)
o In succession, by operation of law, in case a compulsory heir
or legal heir (in the direct line) is disinherited or 8. Suspension and Termination of Parental Authority
incapacitated to inherit, he can be represented by his
children and the latter shall acquire the inheritance due to the Grounds for termination of parental authority
disinherited or incapacitated heir. (Article 923, 1035 NCC) ARTICLE 228, FC. Parental authority terminates permanently:
 BUT the disinherited or incapacitated heir cannot enjoy (1) Upon the death of the parents;
the usufruct or administration of the property inherited. (2) Upon the death of the child; or
 The court shall appoint a judicial administrator to (3) Upon emancipation of the child.
administer the property inherited by the minor child
in representation of the disinherited or incapacitated ARTICLE 229, FC. Unless subsequently revived by a final judgment,
parent. parental authority also terminates:
(1) Upon adoption of the child;
Use of child’s property
(2) Upon appointment of a general guardian; (4) Compels the child to beg; or purpose or in a related
(3) Upon judicial declaration of abandonment of the child in a case (5) Subjects the child or allows case
filed for the purpose; him to be subjected to acts of  Authority may be
(4) Upon final judgment of a competent court divesting the party lasciviousness. reinstated upon order of
concerned of parental authority; or (a) Subjecting the child or the court when it finds
(5) Upon judicial declaration of absence or incapacity of the person allowing the child to be that the cause has
exercising parental authority. subjected to sexual ceased and will not be
abuse is a ground for repeated.
Grounds Discussion permanent deprivation of
(1) Upon the death of the parents; Termination is parental authority.
(2) Upon the death of the child; or permanent
(3) Upon emancipation of the child 9. Parental and Filial Privilege
(4) Upon adoption of the child; Parental authority may
(5) Upon appointment of a general be revived through a ARTICLE 215, FC. No descendant shall be compelled, in a
guardian; court judgment. criminal case, to testify against his parents and grandparents,
(6) Upon judicial declaration of except when such testimony is indispensable in a crime against
abandonment of the child in a case the descendant or by one parent against the other.
filed for the purpose;
(7) Upon final judgment of a Applicable Article 215 FC Section 25, Rule
competent court divesting the party Law 130
concerned of parental authority; or As to Criminal proceedings Civil and criminal
(8) Upon judicial declaration of applicability cases
absence or incapacity of the As to who Only the descendants Descendants or
person exercising parental may invoke ascendants
authority. As to scope A descendant cannot be A person may not be
of privilege compelled to testify in compelled to testify
Grounds for suspension of parental authority criminal cases against his against his parents,
ARTICLE 230, FC. Parental authority is suspended upon conviction parents and grandparents, other direct
of the parent or the person exercising the same of a crime which except when such ascendants,
carries with it the penalty of civil interdiction. The authority is testimony is indispensable children, or other
automatically reinstated upon service of the penalty or upon in a crime against the direct ascendants.
pardon or amnesty of the offender. descendants or by one
parent against the other.
ARTICLE 231, FC. The court in an action filed for the purpose in a As to waiver The person concerned can waive the privilege by
related case may also suspend parental authority if the parent or the choosing to testify against his relatives.
person exercising the same:
(1) Treats the child with excessive harshness or cruelty; T. Emancipation and Summary Proceedings Under the FC
(2) Gives the child corrupting orders, counsel or example;
(3) Compels the child to beg; or 1. Emancipation
(4) Subjects the child or allows him to be subjected to acts of
lasciviousness. Concept
It is the means by which a child is freed from parental authority and
The grounds enumerated above are deemed to include cases which custody of, and from the obligation to render services to, the parent
have resulted from culpable negligence of the parent or the person or persons exercising parental authority.
exercising parental authority.
How emancipation takes place
If the degree of seriousness so warrants, or the welfare of the child ARTICLE 234, FC. Emancipation takes place by the attainment
so demands, the court shall deprive the guilty party of parental of majority. Unless otherwise provided, majority commences at the
authority or adopt such other measures as may be proper under the age of eighteen years.
circumstances.
 By attainment of the age of majority
The suspension or deprivation may be revoked and the parental o 18 years old (234 as amended by RA 6809)
authority revived in a case filed for the purpose or in the same
proceeding if the court finds that the cause therefor has ceased and Effects of emancipation
will not be repeated. ARTICLE 236, FC. Emancipation shall terminate parental authority
over the person and property of the child who shall then be qualified
Grounds Discussion and responsible for all acts of civil life, save the exceptions
(1) conviction of the parent or the Suspension is automatic and established by existing laws in special cases.
person exercising the same of reinstatement is automatic
a crime which carries with it upon service of the Contracting marriage shall require parental consent until the age of
the penalty of civil interdiction sentence. twenty-one.
(2) Treats the child with excessive  Suspension is pursuant
harshness or cruelty; to a court decree in an Nothing in this Code shall be construed to derogate from the duty or
(3) Gives the child corrupting action filed for the responsibility of parents and guardians for children and wards below
orders, counsel or example;
twenty-one years of age mentioned in the second and third

paragraphs of Article 2180 of the Civil Code. In case of separation de facto or abandonment
GR  When a husband and wife are separated in fact, or one has
 Termination of parental authority over the person and property abandoned the other and one of them seeks judicial
of the child authorization for a transaction where the consent of the other
 The child becomes qualified and responsible for all acts of civil spouse is required by law but such consent is withheld or cannot
life be obtained, such authorization may be obtained in a summary
EXC proceeding under Title XI FC. (Article 236 in relation to Articles
 In the marriage of a party at least 18 but below 21, where parental 100[2] and 127[2] FC)
consent is still necessary. (Article 14, 45(1) FC)  In case of separation in fact or abandonment, the deserted spouse
o Otherwise, marriage is voidable. may petition for judicial authority to administer or encumber
 in the marriage settlement of a party below 21 but at least 18, the specific property of the abandoning spouse and to use the fruits or
person whose consent to the marriage is required under Article 14 proceedings for the support of the family. (Articles 100[3] and
FC is also required to be a party to the settlement; otherwise, the 127[3] FC in relation to Articles 239 to 248 FC)
marriage settlement is NOT VALID. (Article 78 FC)
 In contracting a marriage, parental advice is necessary if a party is In relation to exercise of parental authority over property of minor
at least 21 but below 25. (Article 15 FC) child
 the parents and guardians are still liable for the quasi-delict  Under the Code (Article 225 FC), the father and mother shall jointly
committed by their children at least 18 but below 21, provided exercise legal guardianship over the proper of their minor child
that the latter are living in their company. (Article 2180 NCC in without the necessity of a court appointment.
relation to Article 236 FC) o When the market value of the property or annual income of
the child exceeds 50K, the parent concerned shall be required
2. Summary Proceedings Under FC to furnish a bond.
o A verified petition for approval of the bond shall be filed in the
ARTICLE 238, FC. Until modified by the Supreme Court, the proper court of the place where the child resides, or id the child
procedural rules provided for in this Title shall apply as regards resides in a foreign country, in the proper place where the
separation in fact between husband and wife, abandonment by one property is situated.
of the other, and incidents involving parental authority. o This petition is governed by the summary judicial proceedings
under Title XI FC.
Judicial declaration of presumptive death
Judgment in summary proceeding is immediately executory
 For the purpose of contracting the subsequent marriage under the
preceding paragraph the spouse present must institute a  An order of the trial court granting the petition for judicial declaration
summary proceeding as provided in this Code for the declaration of presumptive death pursuant to Article 41 FC is immediately final
of presumptive death of the absentee, without prejudice to the executory.
o Hence, the right to appeal is not granted to any of the parties.
effect of reappearance of the absent spouse. (Article 41 FC)
o It is thus erroneous for the OSG to file a notice of appeal and
o Does not apply if the purpose of the presumption of death is
not to remarry for the RTC to give due course. BUT the aggrieved party may
 Article 290 or 391 NCC is applicable. file a petition for certiorari to question abuse of discretion
amounting to lack of jurisdiction. (Republic v. Sarenogon, Jr.,
 Under prevailing case law, courts are without any authority to take
Republic v. Tango, Republic v. Cantor)
cognizance of a petition that only seeks to have a person declared
presumptively dead under the CC. (Tadeo-Matias v. Republic)
ARTICLE 239, FC. When a husband and wife are separated in fact,
In administration of community or conjugal property or one has abandoned the other and one of them seeks judicial
authorization for a transaction where the consent of the other spouse
 Under Articles 96 and 124 FC: The administration and enjoyment
is required by law but such consent is withheld or cannot be obtained,
of the community property shall belong to both spouses jointly. In
a verified petition may be filed in court alleging the foregoing facts.
case of disagreement, the husband’s decision shall prevail.
o Wife’s remedy: bring a summary proceeding under Title XI of
The petition shall attach the proposed deed, if any, embodying the
the FC within 5 years from the date of the contract
transaction, and, if none, shall describe in detail the said transaction
implementing the husband’s decision.
and state the reason why the required consent thereto cannot be
secured. In any case, the final deed duly executed by the parties shall
In disposition or encumbrance of community or conjugal property
be submitted to and approved by the court.
 Article 96, 124 FC: When one spouse is absent and unable to
participate in the administration of the common or conjugal
properties, court authorization for the alienation or encumbrance of ARTICLE 240, FC. Claims for damages by either spouse, except
such properties may be obtained by the spouse present in a costs of the proceedings, may be litigated only in a separate action.
summary proceeding under Title XI FC.
 The situation in Article 124 FC, which authorizes a summary ARTICLE 241, FC. Jurisdiction over the petition shall, upon proof of
proceeding under the FC, is one where the spouse is absent, or notice to the other spouse, be exercised by the proper court
separated in fact, or has abandoned the other, or consent is authorized to hear family cases, if one exists, or in the regional trial
withheld or cannot be obtained. court or its equivalent sitting in the place where either of the spouses
 A summary proceeding under the FC does not apply to cases resides.
where the non-consenting spouse is incapacitated or
incompetent to give consent. ARTICLE 242, FC. Upon the filing of the petition, the court shall notify
o Proper remedy is judicial guardianship proceedings under the other spouse, whose consent to the transaction is required, of
Rule 93. said petition, ordering said spouse to show cause why the petition
should not be granted, on or before the date set in said notice for the
initial conference. The notice shall be accompanied by a copy of the The law confines the right and duty to make funeral arrangements to the
petition and shall be served at the last known address of the spouse members of the family. (Valino v. Adriano)
concerned.  Thus, the common-law wife does not have the right to make funeral
arrangements over the objection of the wife or the deceased’s
ARTICLE 243, FC. A preliminary conference shall be conducted by brothers and sisters (Tomas Eugenio, Sr. v. Velez).
the judge personally without the parties being assisted by counsel.
After the initial conference, if the court deems it useful, the parties 2. Forms of Funeral
may be assisted by counsel at the succeeding conferences and
hearings. ARTICLE 307, NCC. The funeral shall be in accordance with the
expressed wishes of the deceased. In the absence of such
ARTICLE 244, FC. In case of non-appearance of the spouse whose expression, his religious beliefs or affiliation shall determine the
consent is sought, the court shall inquire into the reasons for his funeral rites. In case of doubt, the form of the funeral shall be decided
failure to appear, and shall require such appearance, if possible. upon by the person obliged to make arrangements for the same, after
consulting the other members of the family.
ARTICLE 245, FC. If, despite all efforts, the attendance of the non-
consenting spouse is not secured, the court may proceed ex parte (1) Wishes of the deceased
and render judgment as the facts and circumstances may warrant. In (2) In the absence of such expression, determined by his religious
any case, the judge shall endeavor to protect the interests of the non- beliefs or affiliation.
appearing spouse. (3) In case of doubt, the form of the funeral shall be decided upon by
the person obliged to make arrangements for the same, after
ARTICLE 246, FC. If the petition is not resolved at the initial consulting the other members of the family.
conference, said petition shall be decided in a summary hearing on
the basis of affidavits, documentary evidence or oral testimonies at  The wishes of the decedent are not absolute. They are limited
the sound discretion of the court. If testimony is needed, the court by Article 305 NCC in relation to Article 199 FC and subject the
shall specify the witnesses to be heard and the subject-matter of their same to those charged with the right and duty to make the proper
testimonies, directing the parties to present said witnesses. arrangements to bury the remains of their loved one.
o If the husband was cohabiting with another woman at the time
ARTICLE 247, FC. The judgment of the court shall be immediately of his death and expressly wished that he be buried in the
final and executory. family mausoleum of the paramour against the wishes of his
legitimate family, said wish cannot prevail over the right and
duty of the loved ones under Article 305 NCC to make proper
ARTICLE 248, FC. The petition for judicial authority to administer or
arrangements. (Valino v. Adriano)
encumber specific separate property of the abandoning spouse and
to use the fruits or proceeds thereof for the support of the family shall
Q. If the spouses had been separated in fact for a year. The husband
also be governed by these rules
has been living with another woman. He died with the paramour. The
legitimate family was vacationing in the US at the time of his death and
U. Funerals
left an instruction for the paramour to wait for them to come back to
arrange the funeral. The paramour instead buried the husband in her
1. Who Has Duty and Right to Arrange for Funerals
family mausoleum. The legitimate family applied for an order to transfer
the body of the decedent to their mausoleum. The paramour opposed,
ARTICLE 199, FC. Whenever two or more persons are obliged to
since it was the express wish of the deceased.
give support, the liability shall devolve upon the following persons in
A. The paramour will not prevail. If there is a conflict between the wish
the order herein provided:
of the deceased and 305, 305 prevails.
(1) The spouse;
(2) The descendants in the nearest degree;
3. Liability for Expenses and Damages
(3) The ascendants in the nearest degree; and
(4) The brothers and sisters.
For funeral expenses
ARTICLE 310, NCC. The construction of a tombstone or mausoleum
 Rule: Shall be in accordance with the order established for support
shall be deemed a part of the funeral expenses, and shall be
(Article 305 NCC; Article 199 FC)
chargeable to the conjugal partnership property, if the deceased is
o (1) The spouse;
one of the spouses.
o (2) The descendants in the nearest degree;
 Funeral expenses, including the construction of a tombstone or
o (3) The ascendants in the nearest degree; and
mausoleum, shall be chargeable against the property of the
o (4) The brothers and sisters.
deceased.
 If the deceased is one of the spouses, such expenses are
In case of concurrence
chargeable to the CPG or ACP.
ARTICLE 305, NCC. The duty and the right to make arrangements
for the funeral of a relative shall be in accordance with the order
For damages
established for support, under article 294. In case of descendants of
ARTICLE 309, NCC. Any person who shows disrespect to the dead,
the same degree, or of brothers and sisters, the oldest shall be
or wrongfully interferes with a funeral shall be liable to the family of
preferred. In case of ascendants, the paternal shall have a better
the deceased for damages, material and moral.
right.
 Descendants of the same degree: oldest shall be preferred
Any person who
 Brothers and sisters: oldest
(1) shows disrespect to the dead, or
 Ascendants: paternal side
(2) wrongfully interferes with a funeral
shall be liable to the family of the deceased for damages, material and (3) It is fixed, unchangeable, or immutable, at least at the start, and
moral may be changed only for good cause and by judicial proceedings.
(4) It is outside the commerce of man, and, therefore, inalienable
Q. The registered owner of a parcel of land had long been dead. A and intransmissible by act inter vivos or mortis causa.
distant relative got the certificate of title and mortgaged the land by (5) It is imprescriptible.
impersonating the deceased. When the immediate family discovered the (Republic v. CA and Maximo Wong)
mortgage, they filed an action to declare the mortgage void because the
registered owner had long been dead. The trial court declared the Use of Surnames is fixed by Law
mortgage void and held the impersonator liable to pay moral damages The name of an individual has two parts:
on the ground of disrespect to the dead. The TC correct? (1) the given or proper name –given to the individual at birth or at
A. No. It must be on occasion of mourning or burial. This does not baptism, to distinguish him from other individuals.
include impersonating the deceased person. (Tabuada v. Tabuada) (a) May be freely selected by the parents for the child.
 being under the title of Funerals, obviously envisions the (2) the surname or family name –identifies the family to which he
commission of the disrespect during the period of mourning over belongs and is continued from parent to child. The
the demise of the deceased or on the occasion of the funeral of the (a) the surname to which the child is entitled is fixed by law.
mortal remains of the deceased.
Use of Middle Name
4. Disposition of Human Remains  There is no law regulating the use of a middle name
 The middle name or the mother’s surname is only considered in
Rule: There can be no retention, interment, disposition of, or Article 375(1) in case there is identity of names and surnames
exhumation of human remains without the consent of those who have between ascendants and descendants, in which case, the
the right and duty to make funeral arrangements of the deceased as middle name or the mother’s surname shall be added. (In Re
mentioned in Article 305 NCC, in relation to Article 199 FC. Adoption of Garcia)
o this does not mean that middle names have no practical or
ARTICLE 308, NCC. No human remains shall be retained, interred, legal significance. Middle names serve to identify the
disposed of or exhumed without the consent of the persons maternal lineage or filiation of a person as well as further
mentioned in articles 294 and 305. distinguish him from others who may have the same
given name and surname as he has. (In Re Petition for
Organ Donation Change of Name and/or Correction/Cancellation of Entry in
 Under the Organ Donation Act of 1991 (RA 7170), as amended Civil Registry of Julian Lin Carulasan Wang)
by RA 7885, any of the following persons, in the order stated o The members of the Civil Code and Family Law Committees
hereunder, in the absence of actual notice of contrary that drafted the FC recognized the Filipino custom of
intentions by the decedent or actual notice of opposition by a adding the surname of the child’s mother as his middle
member of the immediate family of the decedent, may donate name. The members approved the suggestion that the initial
all or any part of the decedent's body for education, research, or surname of the mother should immediately precede
advancement of medical or dental science, therapy, or the surname of the father,
transplantation, after or immediately before death:  In Re Petition for Change of Name and/or Correction /
o Spouse Cancellation of Entry in Civil Registry of Julian Lin Carulasan
o Son or daughter of legal age; Wang: Court did not allow a legitimate child to drop the middle
o Either parent; name from his registered name.
o Brother or sister of legal age; or o It did not find the justification for the dropping the middle name
o Guardian over the person of the decedent at the time of his to be reasonable. The only reason advanced is convenience.
death.
 Any individual, at least 18 and of sound mind, may also give by way 2. Surname of Legitimate Children
of legacy, to take effect after his death, all or part of his body for the
foregoing purposes. ARTICLE 364, NCC. Legitimate and legitimated children shall
principally use the surname of the father.
V. Surnames
RULE: They shall have the right to bear the surnames of the father and
1. In General the mother, (Article 174[1] FC) but shall principally use the surname of
the father. (Article 364 NCC)
Concept of Name  If there is a valid reason, a legitimate child may use the mother’s
A man's name is the designation by which he is known and called in the surname. (Alfon v. Republic, Oshita v. Republic.)
community in which he lives and is best known. It is defined as the word o “Principally” is not equivalent to “exclusively.” There is no legal
or combination of words by which a person is distinguished from other obstacle if a legitimate child chooses the surname of the
individuals and, also, as the label or appellation which he bears for the mother, to which he/she is entitled. (Alfon v. Republic, Oshita
convenience of the world at large addressing him, or in speaking of or v. Republic)
dealing with him. It is both of personal as well as public interest that o The child is not allowed to replace the father’s surname with
every person must have a name. (In Re Adoption of Garcia) that of the stepfather’s because it may result in confusion
with respect to the child’s paternity. (Republic v. CA, Moore v.
Characteristics of Names Republic, Padilla v. Republic)
(1) It is absolute, intended to protect the individual from being
confused with others. Alanis III v. CA: A legitimate child may use either parent’s last name
(2) It is obligatory in certain respects, for nobody can be without a pursuant to the state policy of equality.
name.  What if the child has a valid reason to use the mother’s surname
instead of the father’s surname? This is allowed.
 Alfon v. Republic: He was already using the surname of the money o Where the private handwritten instrument is accompanied by
in all of his records. other relevant and competent evidence, it suffices that the
 Alanis III is similar to Alfon. claim of filiation therein be shown to have been made and
 Oshita v. Republic: Post-war. The child had a Japanese father. handwritten by the acknowledging parent as it is merely
corroborative of such other evidence.
3. Surname of Illegitimate Children  In which case, such instrument authorizes the child to
ARTICLE 176, FC. Illegitimate children shall use the surname and use the father’s surname.
shall be under the parental authority of their mother, and shall be
entitled to support in conformity with this Code. However, illegitimate Q. What if the admission was made in a birthday greeting card and the
children may use the surname of their father if their filiation has been father did not affix his signature?
expressly recognized by the father through the record of birth
appearing in the civil register, or when an admission in a public If birth certificate is void
document or private handwritten instrument is made by the Barcolete v. Republic: Court declared the birth certificates of two IC
father. Provided, the father has the right to institute an action before void because the same were registered only by the father without the
the regular courts to prove non-filiation during his lifetime. The knowledge and consent of the mother. The children did not acquire
legitime of each illegitimate child shall consist of one-half of the the right to use the father’s surnames because of failure to comply
legitime of a legitimate child. with Article 176 FC.
(Discussion was from above) If child was never recognized by the father
 RULE: In the absence of recognition by the father, IC are required  If the surname of an IC registered in the civil registry and appearing
to use the surname of the mother. in his birth certificate is that of his illegitimate father, who failed to
o 176 uses the word “shall”  mandatory. recognize him, can he be allowed to change his surname with
o The discretion on the part of the illegitimate child to use the that of the mother’s?
surname of the father is conditional upon proof of compliance  Republic v. Capote: Court allowed the IC who had been using his
with RA 9255 and its IRR, amending Article 176 FC. father’s surname although the latter did not recognize him to use
(Barcelote v. Republic) the mother’s surname in lieu of the father’s.
o An IC acquires the right to use the father’s surname if he is o The child is entitled to change his name as he was never
voluntarily recognized by the father: recognized by his father while his mother has always
 if their filiation has been expressly recognized by the recognized him as her child. Such change will erase the
father through the record of birth appearing in the civil impression that he was ever recognized by his father.
register, or
 when an admission in a public document or private Allowed to use surname of stepfather
handwritten instrument is made by the father  While a legitimate child was not allowed to use the surname of the
stepfather, an illegitimate child was allowed.
Q. If the recognition is compulsory (172[2]), will the child acquire the right  Calderon v. Republic, Llaneta v. Agrava: A petition for change of
to use the father’s surname? name of an infant should be granted where to do so would be for
A. NO. It must be consented to by the father. the best interest of the child.
o In Calderon: The same would eliminate the stigma of
Use of father’s surname discretionary illegitimacy which the child would carry if he/she continues to
 Grande v. Antonio: Art. 176 gives illegitimate children the right to use the surname of the illegitimate father.
decide if they want to use the surname of their father or not. It is
not the father or the mother who is granted by law the right to dictate 4. Surname of Adopted Children
the surname of their illegitimate children.
o The use of the word "may" in the provision readily shows that Rule
an acknowledged illegitimate child is under no compulsion to ARTICLE 365, NCC. An adopted child shall bear the surname of the
use the surname of his illegitimate father. adopter.
o HENCE: A father cannot compel the use of his surname by  One of the effects of adoption is that the adopted is deemed to be
his IC upon recognition of their filiation. a legitimate child of the adopter for all intents and purposes.
 Being a legitimate child by virtue of her adoption, it follows
Effect if no signature on private handwritten instrument that Stephanie is entitled to all the rights provided by law to a
 While Article 176 FC does not explicitly state that the private legitimate child without discrimination of any kind, including
handwritten instrument acknowledging paternity must be signed by the right to bear the surname of the adopter. (In Re Adoption of
the putative father, this must be read in in relation to Articles 172 Garcia)
and 175, which require that recognition must bear his signature.
 Dela Cruz v. Garcia: If the admission of paternity is in a private If adopted only by the wife
handwritten instrument not signed by the father, may the IC be  The provision of law which entitles the adopted minor to the use of
allowed to make use of the father’s surname? SC allowed the IC to the adopter's surname, refers to the adopter's own surname and
use father’s surname. There were other evidence to prove paternity not to her surname acquired by virtue of marriage.
and filiation.
 Rules in Dela Cruz v. Garcia Thus, the child may not use the adopter’s surname acquired by
o Where the private handwritten instrument is the lone piece of virtue of marriage:
evidence submitted to prove filiation, there should be strict (1) If the wife adopts her IC with the consent of the husband. This is
compliance with the requirement that the same must be one of the exceptions to the rule of joint adoption by spouses. (Sec.
signed by the acknowledging parent 7, DAA)
 Otherwise, such instrument cannot authorize the child to (2) If the spouses are legally separated and only the wife files the
use the father’s surname. adoption.
(3) If the adoption was made by the woman prior to her marriage and Q. If you have decided to use the husband’s surname, can drop this
she thereafter contracted a marriage. surname without a court order?
A. YES. When a woman marries, she does not change her name but
Q. If the AC was adopted only by the mother, with the consent of the only her civil status.
husband, would the AC be entitled to use the surname of the spouse?
NO. AC is entitled to the surname of the adopting parents, only. Q. When will the continued use of the husband’s surname be
mandatory?
In adoption by illegitimate father  Legal separation
In re: Adoption of Stephanie Nathy Astorga Garcia: Court allowed an  Passport Act
IC, upon adoption of her natural father, to use the surname of her natural o Unless you present proof of annulment, nullity, death, or valid
mother as her middle name. There is no law prohibiting an IC adopted decree of divorce
by her natural father to use, as middle name, her mother’s surname. This
will maintain her maternal lineage. Rule in case of legal separation
ARTICLE 372, NCC. When legal separation has been granted, the
Q. An IC was JOINTLY adopted by his mother and his stepfather. What wife shall continue using her name and surname employed
is the right of the IC to surnames? before the legal separation.
A. Surname of the adopting parents.
 The wife shall continue using her name and surname employed
Will he be entitled to use any middle name? before the legal separation.
o If the wife adopted her husband’s surname, the use of the
Q. If illegitimate father adopted his IC with the consent of his wife, the IC husband’s surname becomes obligatory when legal
may use the surname of his father. IC can use the mother’s surname as separation has been granted. (Yasin v. Honorable Judge
his middle name. Shari’a District Court)
Q. If the wife of the husband joined in the adoption, may the IC still be Rule in case of annulment of marriage
allowed to use the surname of the biological mother as middle name? ARTICLE 371, NCC. In case of annulment of marriage, and the wife
A. No. In Re Garcia will no longer apply. The case applies only in cases is the guilty party, she shall resume her maiden name and surname.
where only the illegitimate father adopted the IC. If she is the innocent spouse, she may resume her maiden name and
surname. However, she may choose to continue employing her
Adopted may be allowed to revert back to surname of biological former husband’s surname, unless:
parent (1) The court decrees otherwise, or
 Republic v. CA and Wong: Court allowed an adopted child, after (2) She or the former husband is married again to another person.
the death of the adopting father, to drop the surname of the adopter
and use again the surname of the natural father. The use of the (1) If the wife is the guilty party
surname Wong embarrassed and isolated him from relatives and o She shall resume her maiden name and surname.
friends, as the same suggests a Chinese ancestry when in fact he (2) If she is the innocent spouse
is a Muslim Filipino residing in a Muslim community. (a) She may resume her maiden name and surname OR
o A change of name does not define a change in one’s existing (b) Continue using the former husband’s surname, UNLESS
family relations or in the rights and duties flowing therefrom. It (i) The court decrees otherwise
does not alter one’s legal capacity, civil status or citizenship. (ii) She/former husband is married again to another person
What is altered is only the name.
o The adopting mother also consented to the petition for change In case of death of husband
of name. ARTICLE 373, NCC. A widow may use the deceased husband’s
surname as though he were still living, in accordance with article 370.
5. Surname of Married Woman
 Widow has an option of
o Resuming her maiden name and surname; OR
ARTICLE 370, NCC. A married woman may use:
o Continue employing the deceased’s surname
(1) Her maiden first name and surname and add her husband’s
 The use of husband’s surname after his death is
surname, or
permissive. (Yasin)
(2) Her maiden first name and her husband’s surname, or
 Upon termination of the marriage, by reason of death, divorce, or
(3) Her husband’s full name, but prefixing a word indicating that she
annulment, the woman is not required to seek judicial
is his wife, such as “Mrs.”
confirmation of the change in her civil status to revert to her
maiden name. (Yasin v. Honorable Judge Sharia District Court)
 RULE: A married woman may retain her maiden name after
marriage. 6. In Case of Identity of Names and Surnames
 “May” in Article 370 NCC: use of husband’s surname is permissive.
 When a woman marries, she does not change her name but only Between ascendants and descendants
her civil status. (Remo v. Hon. Sec. of Foreign Affairs, In Re Uy- ARTICLE 375, NCC. In case of identity of names and surnames
Timosa) between ascendants and descendants, the word “Junior” can be
used only by a son. Grandsons and other direct male descendants
Three Options in using husband’s surname shall either:
(1) Maiden first name and surname and add her husband’s surname (1) Add a middle name or the mother’s surname, or
(2) Maiden first name and husband’s surname (2) Add the Roman numerals II, III, and so on.
(3) Husband’s full name, but prefixing a word indicating that she is his (1) The word “Junior” can only be used by a son.
wife (Mrs.) (2) Grandsons and other direct male descendants shall
(a) Add a middle name or the mother’s surname, OR

(b) Add the Roman numerals II, III, and so on. 2. Change of First Name
Between those who are not ascendants and descendants Governing Law
ARTICLE 374, NCC. In case of identity of names and surnames, the  RA 9048, as amended by RA 10172, governs the change of first
younger person shall be obliged to use such additional name or name. (Silverio v. Republic)
surname as will avoid confusion. o Vests the power to entertain petitions for change of first name
 Younger person must use additional name or surname. to the city or municipal civil registrar or consul general.
o Thus, jurisdiction over applications is primarily lodged with
7. Other Rules the said administrative officers.
o The intent is to exclude the change of first name from
Usurpation of name Rules 103 (Change of Name) and 108 (Cancellation or
ARTICLE 377, NCC. Usurpation of a name and surname may be the Correction of Entries in the Civil Registry) until and unless
subject of an action for damages and other relief. an administrative petition for change of name is first filed and
 Usurpation of name implies some injury to the interests of the subsequently denied. (Sec. 7, RA 9048)
owner of the name.  The remedy and the proceedings regulating change of first name
o Consists in the possibility of confusion of identity between the are primarily administrative in nature, not judicial. (Silverio v.
owner and usurper Republic)
o Exists when a person designates himself by another name
Grounds for Change of First Name
Elements (Dapar v. Biascan) Section 4, RA 9048. Grounds for Change of First Name or Nickname.
(1) there is an actual use of another's name by the defendant; – The petition for change of first name or nickname may be allowed in
(2) the use is unauthorized; and any of the following cases:
(3) the use of another's name is to designate personality or identify a (1) The petitioner finds the first name or nickname to be ridiculous,
person tainted with dishonor or extremely difficult to write or pronounce.
(2) The new first name or nickname has been habitually and
Rules on pen and stage names continuously used by the petitioner and he has been publicly known
ARTICLE 379, NCC. The employment of pen names or stage names by that by that first name or nickname in the community: or
is permitted, provided it is done in good faith and there is no injury to (3) The change will avoid confusion.
third persons. Pen names and stage names cannot be usurped.
A change of first name is not allowed by reason of sex reassignment
 Conditions surgery. (Silverio v. Republic)
o Good faith
o No injury to third persons 3. Change of Name Under Rule 103
Rules on use of alias Scope of Rule 103

SECTION 2, CA 142, as amended by RA 6085. Any person desiring  RA 9048, as amended by RA 10172, now governs the change of
to use an alias shall apply for authority therefor in proceedings like first name.
those legally provided to obtain judicial authority for a change of  A person seeking to change his surname or both his first name and
name, and no person shall be allowed to secure such judicial surname may file a petition for change of name under Rule 103,
authority for more than one alias. The petition for an alias shall set provided that the jurisprudential grounds in Republic v. Hernandez
forth the person's baptismal and family name and the name recorded are present. (See below)
in the civil registry, if different, his immigrant's name, if an alien, and
his pseudonym, if he has such names other than his original or real Change of Name – Privilege Only
name, specifying the reason or reasons for the use of the desired  the State has an interest in the names borne by individuals and
alias. The judicial authority for the use of alias the Christian name entities for purposes of identification, and that a change of name is
and the alien immigrant's name shall be recorded in the proper local a privilege and not a matter of right. (Ong Pen Pan v. Republic)
civil registry, and no person shall use any name or names other, than  Republic v. Hernandez: Before a person can be authorized to
his original or real name unless the same is or are duly recorded in change his name, that is, his true or official name or that which
the proper local civil registry. appears in his birth certificate or is entered in the civil register, he
must show proper and reasonable cause or any convincing reason
W. Change of First Name and Surname which may justify such change.
1. What Name May Be Changed Grounds in Republic v. Hernandez:

(1) when the name is ridiculous, dishonorable or extremely difficult to
ARTICLE 376, NCC. No person can change his name or surname write or pronounce;
without judicial authority. (2) when the change results as a legal consequence of legitimation or
 By Article 408 of the Civil Code, a person's birth must be entered adoption;
in the civil register. The official name of a person is that given (3) when the change will avoid confusion;
him in the civil register. That is his name in the eyes of the law. (4) when one has continuously used and been known since childhood
(Republic v. Hernandez; Ng Yao Siong v. Republic) by a Filipino name and was unaware of alien parentage;
(5) when the change is based on a sincere desire to adopt a Filipino
 While under Article 376 NCC, no person can change his
name to erase signs of former alienage, all in good faith and without
name/surname without judicial authority, the only name that may
prejudice to anybody; and
be changed is the true and official name recorded in the Civil
Register. (Yasin)
(6) when the surname causes embarrassment and there is no showing records (Republic v.  Change of surname
that the desired change of name was for a fraudulent purpose or Gallo)  Change of first name
that the change of name would prejudice public interest. and surname
Sex  Clerical  Sex reassignment
Effect of Change of Name surgery
 It does not define or effect a change in one’s existing family Birthday  Day and month  Involves year of birth
relations or in the rights and duties flowing therefrom.
 It does not alter legal capacity, civil status, citizenship. GR: Administrative if clearly clerical or typographical errors; or can be
 What is altered is only the name (Republic v CA and Wong, Yu v. corrected using records
Republic, Calderon v. Republic)
Bartolome v. Republic:
X. Change or Correction of Entry in Civil Register (1) A person seeking
(a) (1) to change his or her first name,
1. Correction of Clerical or Typographical Errors (b) to correct clerical or typographical errors in the civil register,
(c) to change/correct the day and/or month of his or her date of
Governing Law birth, and/or
 Article 412 as amended by RA 9048, 10172: (d) to change/correct his or her sex, where it is patently clear that
o “Section 1: No entry in a civil register shall be changed or there was a clerical or typographical error or mistake,
corrected without a judicial order, except for clerical or (i) must first file a verified petition with the local civil registry
typographical errors and change of first name or nickname, office of the city or municipality where the record being
the day and month in the date of birth or sex of a person where sought to be corrected or changed is kept, in accordance
it is patently clear that there was a clerical or typographical with the administrative proceeding provided under R.A.
error or mistake in the entry, which can be corrected or 9048 in relation to R.A. 10172
changed by the concerned city or municipal civil registrar or (ii) A person may only avail of the appropriate judicial
consul general in accordance with the provisions of this Act remedies under Rule 103 or Rule 108 in the
and its implementing rules and regulations.” aforementioned entries after the petition in the
o The correction or change of such matters may be made administrative proceedings is filed and later denied.
through administrative proceedings without a judicial order. (2) A person seeking
o RA 9049, as amended by RA 10172, removed from the ambit (a) to change his or her surname or
of Rule 108 the correction of such errors. (b) to change both his or her first name and surname
 Rule 108 applies only to substantial changes and corrections in (i) may file a petition for change of name under Rule 103,
entries in the civil register. (Republic v. Cagandahan) provided that the jurisprudential grounds discussed
in Republic v. Hernandez are present.
Meaning of clerical or typographical error (3) A person seeking substantial cancellations or corrections of
 Section 2(3), RA 9048 as amended by RA 10172: (3) ‘Clerical or entries in the civil registry may file a petition for cancellation or
typographical error’ refers to a mistake committed in the correction of entries under Rule 108.
performance of clerical work in writing, copying, transcribing or (a) As discussed in Lee v. CA and more recently, in Republic v.
typing an entry in the civil register that is harmless and innocuous, Cagandahan, R.A. 9048 "removed from the ambit of Rule 108
such as misspelled name or misspelled place of birth, mistake of the Rules of Court the correction of such errors. Rule 108
in the entry of day and month in the date of birth or the sex of now applies only to substantial changes and corrections in
the person or the like, which is visible to the eyes or obvious entries in the civil register."
to the understanding, and can be corrected or changed only
by reference to other existing record or records: Provided, 3. Illustrative Cases
however, That no correction must involve the change of nationality,
age, or status of the petitioner.”  Bartolome v. Republic
 Any correction involving change of nationality, age, or status of o A petition to change name from Feliciano to Ruben on the
the petitioner cannot be considered a mere clerical or typographical ground that petitioner has been using the latter since
error. childhood is primarily administrative and covered by RA 9048.
o Rule 108 applies.  Republic v. Gallo
 Day and month of birth, sex may now be changed without judicial o A prayer to enter a person’s middle name is a mere clerical
proceedings. error, which may be corrected by referring to existing record.
 RA 10172 – these may be administratively corrected where it is o Covered by RA 9048.
patently clear that there is a clerical or typographical mistake  Republic v. Sali
in the entry. o A change of respondent Lorena Ompas Sali’s first name from
o By filing a subscribed and sworn affidavit with the local civil Dorothy to Lorena on the ground that the latter was the name
registry office of the city or municipality where the office of the she was using since birth was primarily administrative in
city or municipality where the record being sought to be nature and should be filed under RA 9048.
corrected or changed is kept. (Republic v. Gallo)
4. Change of Entry as to Sex
2. Summary of Rules  Prior to RA 10172 (August 15, 2012): petition to correct biological
sex was governed by Rule 108 as this was a substantial change
Administrative Judicial excluded in the definition of clerical or typographical errors in RA
Name  Change of first name  Application for 9048.
 Change of middle change of first name o Affirmed by Republic v. Cagandahan and Republic v. Gallo.
name based on is denied
 Republic v. Cagandahan: Under Rep. Act No. 9048, a correction "correction" of petitioner's name from "Ramon Corpus Tan Ko"
in the civil registry involving the change of sex is not a mere to "Ramon Corpuz Tan" would necessarily affect not only his
clerical or typographical error. It is a substantial change for name, but also the names of his parents as entered in his
which the applicable procedure is Rule 108 of the Rules of Court. Certificate of Live Birth.
o When RA 10172 was enacted, errors as to biological sex may o altering petitioner's surname from "Tan Ko" to "Tan" would, in
be administratively corrected, provided they involve a effect, be an adjudication that the first name of his father is
typographical or clerical error. indeed "Ko" and his surname "Tan." Clearly, the correction
o However, this is not true for all cases as corrections in entries would affect the identity of petitioner's father. Moreover, there
of biological sex may be considered a substantive matter. would be a need to correct his mother's name from "Trinidad
o A party who seeks a change of name and sex in his Birth Corpus Tan Ko" to "Trinidad Corpuz Tan." This would require
Certificate after a gender reassignment surgery has to file a deleting the word "Ko" from "Tan Ko" and changing the letter
petition under Rule 108. "s" to "z" in "Corpus." Following Benemerito, to effect the
 Republic v. Unabia: While administrative correction of sex was correction, it would be essential to establish that "Trinidad
only authorized with the passage in 2012 of RA 10172, the Corpus Tan Ko" and "Trinidad Corpuz Tan" refer to the same
amendments under RA 10172 were applicable to the petition filed person. A summary proceeding would certainly be insufficient
in 2009 because said law was remedial in nature and may be to effect such substantial corrections.
applied to pending petitions. o Since the proceeding is adversarial, his failure to implead his
mother is fatal because she would be affected by the
5. Substantial Changes or Corrections Covered by Rule 108 proceeding for correction.
 Ohoma v. Office of the Local Civil Registrar of Aguinaldo,
Scope of Rule 108 Ifugao: Petitioner sought the cancellation of his first birth
 Rule 108 now applies only to substantial changes and corrections certificate registered on June 13, 1986 under Registry Number 45-
in the civil register 86. His birth was belatedly recorded on February 8, 2000 under
o Including change of nationality, age, or status. Certificate of Live Birth with Registry Number 2000-24.
 Republic v. Valencia: substantial errors or matters in a civil o He said the first birth certificate contained erroneous entries
registry may also be corrected under Rule 108 and true facts and his second birth certificate reflects the correct data.
established, provided the parties aggrieved avail themselves of the o SC: There can be no valid late registration of petitioner's
appropriate adversary proceeding. birth as the same had already been lawfully registered
within 30 days from his birth under the first birth
6. Important Reminders on Rule 108 certificate. Consequently, it is the second birth certificate that
should be declared void and correspondingly cancelled even
 Republic v. Coseteng-Magpayo: when a petition for if the entries therein are claimed to be the correct ones.
cancellation or correction of an entry in the civil register involves
substantial and controversial alterations including those on Y. Absence
citizenship, legitimacy of paternity or filiation, or legitimacy of
marriage, a strict compliance with the requirements of Rule 108 is 1. Concept and Stages
mandated.
 A petition for a substantial correction or change of entries in the civil Concept
registry should implead the civil registrar, as well as all other It is the legal status of one who is not in his domicile, his
persons who have or claim to have any interest that would be whereabouts being unknown, and it is uncertain whether he is dead
affected thereby. (Onde v. Office of the Local Civil Registrar of Las or alive.
Pinas City)
 While there may be cases where the Court held that the failure to Three Stages of Absence
implead and notify the affected or interested parties may be (1) Provisional Absence
cured by the publication of the notice of hearing, earnest ARTICLE 381, NCC. When a person disappears from his domicile,
efforts were made by petitioners in bringing to court all possible his whereabouts being unknown, and without leaving an agent to
interested parties. (Republic v. Uy) administer his property, the judge, at the instance of an interested
o Such failure was likewise excused party, a relative, or a friend, may appoint a person to represent him
 where the interested parties themselves initiated the in all that may be necessary.
corrections proceedings;
 when there is no actual or presumptive awareness of the This same rule shall be observed when under similar circumstances
existence of the interested parties; or the power conferred by the absentee has expired.
 when a party is inadvertently left out.
 Tan v. Office of the Local Civil Registrar of the City of Manila: Requisites
petitioner filed on November 24, 2011 a petition for correction of (1) The absentee should have disappeared from his domicile.
entry under Rule 108 before the RTC to correct his name in the (2) His whereabouts are not known.
birth certificate from “Ramon Corpus Tan Ko” to “Ramon Corpuz (3) He did not leave any agent to administer his property.
Tan.” (4) The appointment of a representative in connection with such
o RTC dismissed the petitioner because the petitioner failed to property is urgent or necessary.
comply with the requirements of an adversarial proceeding.
The correction sought for is a substantial correction and (2) Declared Absence
governed by Rule 108. Petitioner should have impeaded his ARTICLE 384, NCC. Two years having elapsed without any news
mother. about the absentee or since the receipt of the last news, and five
o SC: the correction involves a substantial change. The name years in case the absentee has left a person in charge of the
“Tan Ko” has been consistently used not only in the entries for administration of his property, his absence may be declared.
petitioner's name, but also for that of his parents. Thus, the
Requisites Law Article 41 FC Article 390, 391 NCC

 The absentee should have disappeared from his domicile. When
 His whereabouts are not known. Purpose The presumption For purposes other than
 He has been absent without any news of death is only for remarriage
o For two years, if nobody was left to administer his the purpose of
property, OR contracting a
o For five years if somebody was left to administer such valid subsequent
property. marriage.
Judicial Required A petition for issuance
(3) Presumptive Death Declaration of of judicial declaration of
When after the period provided by law, a person is presumed death. Presumptive presumptive death is
Death not authorized. (Tadeo-
ARTICLE 390, NCC. After an absence of seven years, it being Matias)
unknown whether or not the absentee still lives, he shall be presumed
dead for all purposes, except for those of succession. Reasons why a petition for declaration of presumptive death under
NCC was disallowed (Tadeo-Matias):
The absentee shall not be presumed dead for the purpose of opening (1) Articles 390 and 391 NCC merely express rules of evidence that
his succession till after an absence of ten years. If he disappeared only allow a court or a tribunal to presume that a person is dead
after the age of seventy-five years, an absence of five years shall be upon the establishment of certain facts.
sufficient in order that his succession may be opened. (2) Since Articles 390 and 391 NCC merely express rules of evidence,
an action brought exclusively to declare a person presumptively
ARTICLE 391, NCC. The following shall be presumed dead for all dead under either of the said articles actually presents no actual
purposes, including the division of the estate among the heirs: controversy that a court could decide. In such action, there would
(1) A person on board a vessel lost during a sea voyage, or an be no actual rights to be enforces, no wrong to be remedied nor
aeroplane which is missing, who has not been heard of for four any status to be established.
years since the loss of the vessel or aeroplane; (3) A judicial pronouncement declaring a person presumptively dead
(2) A person in the armed forces who has taken part in war, and under Article 390 or Article 391 of the Civil Code, in an action
has been missing for four years; exclusively based thereon, would never really become "final" as the
(3) A person who has been in danger of death under other same only confirms the existence of a prima facie or disputable
circumstances and his existence has not been known for four presumption. The function of a court to render decisions that is
years. supposed to be final and binding between litigants is thereby
compromised.
Requirement of Judicial Declaration of Absence (4) Moreover, a court action to declare a person presumptively dead
(a) When necessary under Articles 390 and 391 of the Civil Code would be
 There is no need for a judicial declaration of absence if there are unnecessary. The presumption in the said articles is already
no properties. (Reyes v. Alejandrino) established by law.
 The need to have a person judicially declared an absentee is when
o he has properties which have to be taken cared of or 3. Required Period of Absence for Presumptive Death
administered by a representative appointed by the Court
(Article 384, Civil Code); Ordinary Qualified
o the spouse of the absentee is asking for separation of property Definition If the person If the person
(Article 191, Civil Code) or disappeared in a disappeared in a
o the spouse is asking the Court that the administration of a situation where there situation where
classes of property in the marriage be transferred to him/her was no danger of death there was danger
(Article 196, Civil Code). of death
For purposes of 4 years 2 years
(b) Declaration of Absence and Petition for Administration remarriage
 The petition to declare the husband an absentee and the petition For opening of  GR: 10 years 4 years
to place the management of the conjugal properties in the hands of succession  EXC: 5 years, if the
the wife may be combined and adjudicated in the same person
proceedings. disappeared after
 Daya Maria Tol-Noguera v. Villamor: It is not necessary that a the age of 75
declaration of absence be made in a proceeding separate from and For all other 7 years 4 years
prior to a petition for administration. purposes
When is the On the last day of the On the day of the
2. Presumption of Death death deemed period happening of the
to have taken event (the first day)
Governing Law place?
Law When
Article 41 FC The presumption of death is only for the purpose Art. 41. A marriage contracted by any person during subsistence of a
of contracting a valid subsequent marriage. previous marriage shall be null and void, unless before the celebration
Article 390, 391 For purposes other than remarriage of the subsequent marriage, the prior spouse had been absent for four
consecutive years and the spouse present has a well-founded belief that
Requirement of Judicial Declaration of Presumptive Death the absent spouse was already dead. In case of disappearance where
there is danger of death under the circumstances set forth in the
provisions of Article 391 of the Civil Code, an absence of only two years
shall be sufficient.
For the purpose of contracting the subsequent marriage under the

preceding paragraph the spouse present must institute a summary
proceeding as provided in this Code for the declaration of presumptive
death of the absentee, without prejudice to the effect of reappearance of
the absent spouse.
Q. If the marriage is contracted during the FC, and there is no judicial

declaration of presumptive death?
A. Subsequent marriage is void.
Q. Will there be criminal liability? Can it be said that there can only be
civil liability?
A. No. The purpose of Article 41 FC in requiring a judicial declaration of
presumptive death is to harmonize our civil law and criminal law of
bigamy.
BOOK II. PROPERTY  3: Everything attached to an immovable in a fixed manner, in

such a way that it cannot be separated therefrom without breaking
Z. Classification of Property the material or deterioration of the object
1. Concept of Property (3) Immovable by Destination – essentially movable, but by the

purpose for which they have been placed in an immovable, partake
Definition: Properties are things which care capable of satisfying human of the nature of the latter because of the added utility derived
wants and are susceptible of appropriation. therefrom
 Paragraphs 4, 5, 6, 7, 9
Requisites  Not permanently attached to an immovable
(1) Utility, or the capacity to satisfy human wants
(2) Individuality and substance – separate and autonomous (4) Immovable by Analogy – Paragraph 10
existence  Rights over immovable property
(3) Susceptibility of being appropriated.  All personal rights are personal property, except for contracts for
public works
2. Kinds of Immovable Property
3. Enumeration of Immovable Property
Art. 415, NCC. The following are immovable property:
(1) Land, buildings, roads and constructions of all kinds adhered to (1) Paragraph 1: Land, buildings, roads and constructions of all kinds
the soil; adhered to the soil
(2) Trees, plants, and growing fruits, while they are attached to the (a) Land and roads: always immovable
land or form an integral part of an immovable; (b) Buildings
(3) Everything attached to an immovable in a fixed manner, in such  If permanently attached to land, is always immovable.
a way that it cannot be separated therefrom without breaking (Punzalan Jr. v. vda. De Lacsamana)
the material or deterioration of the object;  Those merely superimposed on the soil or sold for immediate
(4) Statues, reliefs, paintings or other objects for use or demolition are movable. (Bautista, et. al. v. Supnad)
ornamentation, placed in buildings or on lands by the owner of  A building by itself is a real property. Hence, it may be mortgaged
the immovable in such a manner that it reveals the intention to apart from the land. (Prudential Bank v. Panis)
attach them permanently to the tenements;  A building is immovable by incorporation. Hence, once the house
(5) Machinery, receptacles, instruments or implements intended by is demolished, it ceases to exist as such and its character as an
the owner of the tenement for an industry or works which may immovable also ceases. (Bicerra v. Teneza)
be carried on in a building or on a piece of land, and which tend  Once a building is permanently attached to land, it is immovable,
directly to meet the needs of the said industry or works; irrespective of whether the said structure and the land belong to the
(6) Animal houses, pigeon-houses, beehives, fish ponds or same owner, (Lopez v. Orosa) or whether the building is erected
breeding places of similar nature, in case their owner has placed by the owner of the land or by a usufructuary or lessee (Ladera v.
them or preserves them with the intention to have them Hodges).
permanently attached to the land, and forming a permanent part
 If the parties treat the building as movable as between them, they
of it; the animals in these places are included;
are estopped from alleging the contrary. (Navarro v. Pineda,
(7) Fertilizer actually used on a piece of land;
Tumalad v. Vicencio)
(8) Mines, quarries, and slag dumps, while the matter thereof forms
o Not applicable to strangers to the contract (Evangelista v. Alto
part of the bed, and waters either running or stagnant;
Surety) – immovable
(9) Docks and structures which, though floating, are intended by
o Parties are estopped from assailing their former agreement.
their nature and object to remain at a fixed place on a river, lake,
o We are not saying the building is personal property. That is
or coast;
different. We simply prevented the parties from preventing the
(10) Contracts for public works, and servitudes and other real rights
validity of the agreement after benefitting from the agreement
over immovable property. (334a)
where they say that the subject matter is personal property.
o We can’t change the character of the building because this is
NIDA provided in law.
(1) Immovable by Nature – By their essence and nature are o Estoppel cannot be applied in case of third persons.
immovable or cannot be moved from one place to another.
 A building is always a real property under the law.
 Lands, roads, mines, quarries, slag dumps, waters in their original
 Even if the parties treated a building as personal property, the RD
state
may not refuse registration of the mortgage. Its duties are
 1, 2, 8 ministerial. (Standard Oil v. Jaramillo)
(c) Constructions adhering to soil
(2) Immovable by Incorporation – Become immovable by reason of
 The construction must be attached permanently to land and it
their attachment or incorporation to an immovable in such manner
must not be provisional or temporary. It must be fixed and
as to be an integral part thereof
integral.
 1: buildings and constructions of all kinds adhered to the soil
 2: Trees, plants, and growing fruits, while they are attached to the (2) Paragraph 2
land or form an integral part of an immovable (a) Trees and Plants
o Trees are generally classified as movables by incorporation  Generally immovable if incorporated to the soil.
o Forming an integral part: even if the tree is no longer  If cut or uprooted, they become immovable,
attached to the soil  unless they form an integral part of the land (e.g.,
 Example: timber, which has been cut but is a natural
timber, which constitutes the natural product of the
product of the tenement
tenement)
(b) Growing fruits  Placed by the owner of the land.

 For certain purposes, they may be regarded as personal
property pursuant to Article 416(2). They must not be permanently attached to the soil; otherwise, it will
 For purposes of sale, attachment and execution, become an immovable by incorporation under Paragraph 1 (construction
and mortgage (Sibal v. Valdez) – personal adhering to the soil) or under Paragraph 3.
(3) Paragraph 3 and 4 (6) Paragraph 7

(a) Paragraph 3  Fertilizers actually used on a piece of land.
 Refers to permanent fixtures, or everything attached to  Intention to use
an immovable in a fixed manner, in such a way that it
cannot be separated therefrom without breaking the (7) Paragraph 8
material or deterioration of the object Refers to mines, quarries, and slag dumps, while the matter thereof
(b) Paragraph 4 forms part of the bed, and waters either running or stagnant;
 Refers to ornaments or statutes, reliefs, paintings, or
other objects for use or ornamentation, placed in (8) Paragraph 9
buildings or on lands by the owner of the immovable in Refers to docks and structures which, though floating, are intended by
such a manner that it reveals the intention to attach them their nature and object to remain at a fixed place on a river, lake, or
permanently to the tenements; coast.
(c) Distinctions between 3 and 4  Immovables by destination.
 EXAMPLE: Boathouse which, by nature, is a vessel and, therefore,
Paragraph 3 Paragraph 4 a personal property but, if it is tied to the shore and used as a
Immovable by incorporation Immovable by destination residence, and since it floats on waters which is immovable, is
Separation from immovable is Separation is possible considered real property. (Capitol Wireless, Inc. v. Provincial
not possible without injury Treasurer)
It is not important who caused It is the owner of the immovable
the attachment who must place the ornament (9) Paragraph 10
unto the immovable. Refers to contracts for public works, and servitudes and other real rights
over immovable property.
Immovables by destination:  Immovable by analogy.
 are simply placed into an immovable. There must be no permanent  If the real right is exercised over immovable property, like a
attachment or incorporation. registered real estate mortgage, it is a real property. (MBTC v.
 They must be placed with a permanent intention. Alejo)
 They must be placed by the owner of the immovable.  If exercised over a movable, it is a personal property.
 If it is a personal right, it is always a personal property, whether
(4) Paragraph 5 exercised over a personal or real property, except contracts for
 Machinery, receptacles, instruments or implements intended to be public works.
used for an industry or works.
o What manner of use? PRINCIPAL AND ESSENTIAL 4. Real Property for Taxation Purposes
 Movables by destination.
LGC Prevails
Requisites for Immovability As between the Civil Code, a general law governing property and
 Must be destined for use in the industry or work in the tenement property relations, and the LGC, a special law granting local government
(Berkenkotter v. Cu Unjieng) and must be essential and principal units the power to impose real property tax, then the latter shall
elements of the industry or works. (Mindanao Bus Co. v. City prevail. (Meralco v. The City Assessor)
Assessor)
 Industry or work must be carried on in a building or piece of land Illustrative Cases
(Board of Assessment v. Meralco), or even on waters. (Capitol  Meralco v. City Assessor: The transformers, electric posts,
Wireless, Inc. v. Provincial Treasurer.) transmission lines, insulators, and electric meters of MERALCO
o Thus, submarine or underwater communications cables may may qualify as "machinery" subject to real property tax under the
be classified under the term “machinery” as real property. LGC.
 Placed by the owner of the tenement, unless the tenant acts as  Capitol Wireless, Inc. v. Provincial Treasurer of Batangas:
an agent of the owner. (Davao Sawmill v. Castillo) Submarine or undersea communications cables entering the
territorial jurisdiction of the PH are akin to electric transmission lines
Application of Estoppel and may qualify as "machinery" subject to real property tax under
 Although the machineries are essential and principal elements of the LGC.
the industry, they can be subjects of a writ of replevin if the parties
treated the same as personal property. (Serg’s Products, Inc. v. 5. Movable Property Under Articles 416 and 417
PCI Leasing; Makati Leasing v. Wearever Textile Mills)
ARTICLE 416, NCC. The following things are deemed to be personal
(5) Paragraph 6 property:
 Refers to animal houses, pigeon-houses, beehives, fish ponds or (1) Those movables susceptible of appropriation which are not
breeding places of similar nature included in the preceding article;
(2) Real property which by any special provision of law is
Requisites for Immovability considered as personalty;
 Permanently placed or attached to the land
(3) Forces of nature which are brought under control by science;  Fungible: if, by the intention of the parties, it can be replaced by
and another of the same kind.
(4) In general, all things which can be transported from place to  Otherwise, it’s non-fungible.
place without impairment of the real property to which they are
fixed. Note:
 In classifying movables into consumable or non-consumable, the
ARTICLE 417, NCC. The following are also considered as personal basis of classification is the very nature of the corporeal object.
property:  Fungible/Non-fungible: the basis is the intention of the parties.
(1) Obligations and actions which have for their object movables or
demandable sums; and AA. Classification of Property: Based on Ownership
(2) Shares of stock of agricultural, commercial and industrial
entities, although they may have real estate. 1. In General
(a) Article 416(1) ARTICLE 419, NCC. Property is either of public dominion or of
 movables susceptible of appropriation which are not included 415. private ownership.
 Example: Interest in business, as well as the business itself (Laurel
v. Abrogar)  In relation to the person to whom the property belongs, property is
either of
(b) Article 416(2) o Public dominion
 Real property which by any special provision of law is considered o Private ownership
as personalty  Properties are owned either in a
 Example: growing fruits although attached to the land for purposes o Public capacity (dominio publico) OR
of the sale of the whole crops, for purposes of the Chattel Mortgage o Private capacity (propiedad privado) (Republic v. Alejandre)
Law (Sibal v. Valdez), for purposes of attachment or execution.
(a) Public Dominion
(c) Article 416(3) ARTICLE 420, NCC. The following things are property of public
 Forces of nature which are brought under control by science dominion:
 Examples: gas (US v. Tambunting), electricity (US v. Carlos) (1) Those intended for public use, such as roads, canals, rivers,
 PLDT Case: what was taken from PLDT was electricity or its torrents, ports and bridges constructed by the State, banks,
business, which was personal property shores, roadsteads, and others of similar character;
(2) Those which belong to the State, without being for public use,
(d) Article 416(4) and are intended for some public service or for the development
 In general, all things which can be transported from place to place of the national wealth.
without impairment of the real property to which they are fixed
 Example: Vessels (Rubiso v. Rivera, Phil refining Co., Inc. v. There are three kinds of property of public dominion:
Jarque)  (1) those intended for public use;
 (2) those intended for some public service; and
(e) Article 417(1)  (3) those intended for the development of national wealth.
 Obligations and actions which have for their object movables or
demandable sums (b) Private ownership
 BUT a mortgage loan is real property because it is a real right over ARTICLE 421, NCC. All other property of the State, which is not of
an immovable. It is real by analogy. (Hongkong & Shanghai Bank the character stated in the preceding article, is patrimonial property.
v. Aldecoa)
ARTICLE 422, NCC. Property of public dominion, when no longer
(f) Article 417(2) intended for public use or for public service, shall form part of
 Shares of stock of agricultural, commercial and industrial entities, the patrimonial property of the State.
although they may have real estate
 Membership shares in golf clubs are movable. Such share is a ARTICLE 424, NCC. Property for public use, in the provinces, cities,
property right which a person cannot be deprived of without and municipalities, consist of the provincial roads, city streets,
affording him the benefit of due process. (Valley Golf and Country municipal streets, the squares, fountains, public waters,
Club, Inc. v. Reyes) promenades, and public works for public service paid for by said
provinces, cities, or municipalities.
6. Classification of Movable Property
All other property possessed by any of them is patrimonial and shall
(a) Consumable or Non-consumable be governed by this Code, without prejudice to the provisions of
special laws.
ARTICLE 418, NCC. Movable property is either consumable or
nonconsumable. To the first class belong those movables which ARTICLE 425, NCC. Property of private ownership, besides the
cannot be used in a manner appropriate to their nature without their patrimonial property of the State, provinces, cities, and
being consumed; to the second class belong all the others. municipalities, consists of all property belonging to private persons,
either individually or collectively.
The classification applies to movables and to corporeal objects only.
CC classifies property of private ownership into three:
(b) Fungible and Non-fungible  (1) patrimonial property of the State under Articles 421 and 422;
 (2) patrimonial property of LGUs under Article 424; and
 (3) property belonging to private individuals under Article 425  Foreshore land is that part “of the land immediately in
front of the shore; that part which is between the high and
2. Property of the State the low water marks and alternately covered with water
or left dry by the flux or reflux of the tide. It is indicated
Property of the state may be: by a middle line between the highest and lowest tides.
 Public dominion (Hacut v. Director of Lands)
o Is this equivalent to state ownership? No. It means public  The mere reclamation of foreshore lands and submerged
ownership. areas does not convert these into patrimonial property.
 Patrimonial There must be a law or presidential proclamation
officially classifying them into patrimonial property.
ARTICLE XII, SECTION 2. All lands of the public domain, waters, (Chavez v. PEA)
minerals, coal, petroleum, and other mineral oils, all forces of potential (3) All waters belong to the State and are classified as property
energy, fisheries, forests or timber, wildlife, flora and fauna, and other of public dominion (Article 3, Water Code), including
natural resources are owned by the State. With the exception of  rivers and their natural beds, natural lakes, and their
agricultural lands, all other natural resources shall not be alienated. The natural beds (Article 5, WC), which is the ground covered
exploration, development, and utilization of natural resources shall be by their waters when at their highest ordinary debt, and
under the full control and supervision of the State. The State may directly  creeks, defined as a recess or arm extending from a river
undertake such activities, or it may enter into co-production, joint and participating in the ebb and flow of the sea.
venture, or production-sharing agreements with Filipino citizens, or (4) Aside from roads, a road right of way for national highways
corporations or associations at least sixty per centum of whose capital (5) Lands classified as reservations for public or quasi-public
is owned by such citizens. Such agreements may be for a period not uses (e.g. military reservations)
exceeding twenty-five years, renewable for not more than twenty-five (6) Water works system constructed by the DPWH devoted to
years, and under such terms and conditions as may be provided by law. public use (General Mariano Alvarez Services Cooperative,
In cases of water rights for irrigation, water supply, fisheries, or industrial Inc. v. NHA)
uses other than the development of water power, beneficial use may be
the measure and limit of the grant. (c) Alienable and disposable agricultural lands
 These are properties of public dominion. But under the constitution,  The 1987 Constitution adopted the classification under the 1935
they are owned by the State and not the public in general. Constitution into agricultural, forest or timber, and mineral, but
 Jura Imperii – state owns the properties as a representative of the added national parks.
citizens. The power exercised by the state is jura imperii.  All other natural resources may not be alienated. (Heirs of
o This has evolved in the Constitution, where there has been a Malabanan v. Republic 2013)
declaration of ownership over properties (natural resources)
o Thus public dominion in the modern concept is NOT SOLELY Two Types of Alienable and Disposable Lands of the State
public ownership. It could be state ownership in relation to (1) patrimonial lands of the State, without limitation;
natural resources. (2) lands of the public domain, or the public lands as provided by the
Constitution, but with the limitation that the lands must only be
[A] Property of Public Dominion agricultural.
(a) Kinds of Property of Public Dominion Still Classified as Public Dominion

(1) Those intended for public use  Lands of the public domain, whether declared alienable and
 those the use of which is not confined to privileged disposable or not, are property of public dominion and thus
individuals, but is open to the indefinite public (Villarico insusceptible to acquisition by prescription. (Malabanan 2009)
v. Sarmiento)  Declaration merely gives the State the authority to alienate or
 Example: roads, canals, rivers, torrents, ports and dispose the agricultural land, and in accordance with law.
bridges constructed by the State, banks, shores,
roadsteads, and others of similar character To be converted into patrimonial property, there are 2 ways:
(2) Those intended for some public service (1) Express declaration by the State that the public dominion
 Those which cannot be used indiscriminately by anyone property is no longer intended for public service or the development
but only by those that are authorized by proper of the national wealth or that the property has been converted into
authority patrimonial. (Dumo v. Republic)
(3) Those intended for the development of the national (a) Such declaration shall in the form of a law duly enacted by
wealth. Congress or a Presidential Proclamation in cases where the
 Mere intention to devote a property to public use, public President is duly authorized by law.
service, or for the development of the national wealth is (2) It is actually alienated and disposed of the state. (Malabanan 2009)
sufficient to make it a property of public dominion.
 It is not necessary that it must actually be used as such. (d) Sec. 14(1) and (2) of Property Registration Decree
(Manila Lodge v. CA, Agripino Capitulo v. Alejo Aquino)
Distinctions
(b) Examples of property for public use 14(1) 14(2)
(1) Ports (420[1]) includes airports and seaports (MIAA v. CA, Basis of Possession and occupation Acquisitive
PH Fisheries Development Authority v. CA) grant of title [Prior to the cut-off, must prescription
(2) Aside from shores date back to June 12, 1945]
 Foreshore lands (Republic v. CA 1997) Basis of  Property Registration  Property
 Reclamation of foreshore lands and submerged seas Registration Decree Registration
(Chavez v. PEA)  Public Lands Act Decree
 Civil Code Q. You have a parcel of land in the province. There was land adjacent
Land Agricultural land of the Patrimonial to it, which you registered under your name. The additional land was an
Involved public domain already [Prescription will not abandoned river bed. Can you acquire it?
declared alienable and run against public A. NO. It remains public dominion. The only exception is 461, where
disposable (not yet dominion. Outside there is a natural change in the course of the river, and the new course
patrimonial) the commerce of invades the property of the owner.
man]
Republic v. Zurbaran Realty and Development [B] Patrimonial Property of State
Requisites for Registration under Paragraph 1 (a) Concept

(1) Land is alienable and disposable land of the public domain, at ARTICLE 420, NCC. The following things are property of public
least at the time of filing of application dominion:
(2) Applicant and its predecessors-in-interest have been in open, (1) Those intended for public use, such as roads, canals, rivers,
continuous, exclusive, and notorious possession and torrents, ports and bridges constructed by the State, banks,
occupation of the land under a bona fide claim of ownership shores, roadsteads, and others of similar character;
(3) Applicant and its predecessors-in-interest have possessed and (2) Those which belong to the State, without being for public use,
occupied the land since June 12, 1945, or earlier. (Republic v. and are intended for some public service or for the
Alonso) development of the national wealth.
Alienable and Disposable + OCENPO + under bona fide claim of
ownership ARTICLE 421, NCC. All other property of the State, which is not of
 If all the requisites are present, the land ceases to be part of the the character stated in the preceding article, is patrimonial property.
public domain and becomes private property.
 This mode of disposition is referred to as judicial confirmation of ARTICLE 422, NCC. Property of public dominion, when no longer
imperfect or incomplete title under Section 48(b) of the Public intended for public use or for public service, shall form part of
Land Act. the patrimonial property of the State.
Requisites for Registration under Paragraph 2  All other property, which is not of the character stated in Article 420
(1) Land is alienable and disposable land of the public domain o Not for public use
(2) Applicant and its predecessors-in-interest have been in possession o Not for public service
of the land for o Not for the development of national wealth
(a) at least 10 years, in good faith, and with just title, OR  It is property owned by the State in its private capacity or private
(b) at least 30 years, regardless of good faith or just title property of the government. (Heirs of Leopoldo Delfin v. NHA)
(3) The land had already been converted to or declared as patrimonial
property of the State at the beginning of said 10-year or 30-year (b) Sub-classification
period of possession. (1) By nature or use: Those covered by Article 421, which are
not property of public dominion or imbued with public
(e) Characteristics of Public Dominion purpose based on the State’s current or intended use
(1) They are outside the commerce of man. (MIAA v. CA)
 They cannot be subject to sale, disposition or (2) By Conversion: Those covered by Article 422, which
encumbrance; any sale, disposition or encumbrance of previously assumed the nature of property of public
such property of the public dominion is void for being dominion by virtue of the State’s use, but which are no
contrary to law and public policy. (Navy Officers’ Village longer being used or intended for said purpose. (Republic
Association v. Republic) v. Alejandre)
 They cannot be leased or be the subject matter of
contracts. (Dacanay v. Asistio) (c) Susceptible to Prescription
 Alienation of public dominion is VOID.  Heirs of Malabanan v. Republic (2009): Patrimonial property of
 Only patrimonial property may be sold. the state may be acquired by prescription, Article 1113 CC.
(2) They are not susceptible to private appropriation and
cannot be acquired by acquisitive prescription. (Dream Village (d) Conversion to Patrimonial Property
v. BCDA) There must be:
(3) They cannot be the subject of an auction sale, levy,  Abandonment or non-use; AND
encumbrance, or disposition through public or private sale.  Affirmative act, either on the part of the executive or the
 Any encumbrance, levy on execution, or auction sale of legislative, to reclassify property of the public dominion into
any property of public dominion is void for being patrimonial property. (Laurel v. Garcia).
contrary to public policy. (Privatization and o Law, except in the conversion of agricultural lands of the
Management Office v. CTA) public domain which have already been declared alienable
(4) They cannot be burdened by any voluntary easement. and disposable, where the conversion must be expressly
(VIllarico v. Sarmiento) declared in the form of a law duly enacted by Congress, or a
Presidential Proclamation in cases where the President is duly
Public Dominion Patrimonial authorized by law. (Malabanan 2009)
Sale Void Allowed o Law
Acquisitive Not susceptible of Allowed (1113 NCC) o Presidential Proclamation
Prescription appropriation 2009 - Malabanan
3. Property of Provinces, Cities, and Municipalities
In General
ARTICLE 424, NCC. Property for public use, in the provinces, (Zamboanga del Norte v. The City of Zamboanga) The province merely
cities, and municipalities, consist of the provincial roads, city streets, holds the property in trust for the state. The LGU is merely Hence, the
municipal streets, the squares, fountains, public waters, State may entrust it to another administrator. There was no
promenades, and public works for public service paid for by said expropriation.
provinces, cities, or municipalities.
BB. Ownership in General
All other property possessed by any of them is patrimonial and
shall be governed by this Code, without prejudice to the provisions of 1. Rights Included
special laws.
(1) Right to enjoy
The property of LGUs is either for public use (public dominion) or (2) Right to dispose
patrimonial. (3) Right to recover
(4) Right to exclude others from the property
[1] Public Dominion (5) Right to enclose or fence his property
(a) Kinds (6) Right to compensation in case of eminent domain
(1) Those expressly enumerated in 424(1) as intended for ARTICLE 435, NCC. No person shall be deprived of his property
public use: provincial roads, city streets, municipal streets, except by competent authority and for public use and always upon
the squares, fountains, public waters, promenades, and public payment of just compensation.
works for public service paid for by said provinces, cities, or
municipalities. Should this requirement be not first complied with, the courts shall
(2) Those not expressly enumerated in 424(1) but devoted to protect and, in a proper case, restore the owner in his possession.
public and governmental purposes, such as local
administration, public education, and public health. (7) Right to the surface, the sub-surface, and the space above the land
(Sangguniang Panlalawigan of Bataan v. Garcia, Jr.) (8) Right to hidden treasure
(9) Right of accession (440-475, see below)
(b) Characteristics
 Governed by the same principles as property of public dominion of 2. Right to Enjoy
the same character. ARTICLE 428, NCC. The owner has the right to enjoy and dispose
 The property of LGUs devoted to public use is outside the of a thing, without other limitations than those established by
commerce of man and as a consequence: law.
(1) It is not alienable or disposable;
(2) It is not subject to registration under PD 1529 and cannot The owner has also a right of action against the holder and possessor
be the subject of a Torrens title of the thing in order to recover it.
(3) It is not susceptible to prescription
(4) It cannot be leased, sold, or otherwise be the subject of a (a) Basic Limitation
contract; (1) Principle of abuse of right
(5) It is not subject to attachment and execution; and
(6) It cannot be burdened by any voluntary easements. (Alolino (b) Right to exclude others
v. Flores)
(1) Right to fence
[2] Patrimonial Property
These are the properties of the LGUs not expressly mentioned in 414(1) ARTICLE 430, NCC. Every owner may enclose or fence his land or
and devoted to proprietary or private purposes. tenements by means of walls, ditches, live or dead hedges, or by any
Not mentioned in 414(1) + use is proprietary other means without detriment to servitudes constituted thereon.
 A property owner may enclose or fence his property subject only to
Extent of Congress’ Control limitations provided by law.
 If the property is owned by the LGU in its public and
governmental capacity (2) Doctrine of Self-help
o it is public
o Congress has absolute control over it; ARTICLE 429, NCC. The owner or lawful possessor of a thing has
 If the property is owned in its private or proprietary capacity the right to exclude any person from the enjoyment and disposal
o it is patrimonial thereof. For this purpose, he may use such force as may be
o Congress has no absolute control reasonably necessary to repel or prevent an actual or threatened
o LGU cannot be deprived of it without due process and unlawful physical invasion or usurpation of his property.
payment of just compensation.
(Sangguniang Panlalawigan of Bataan v. Garcia, Jr.)  Owner of lawful possessor may use reasonable force to repel or
prevent an actual or threatened unlawful physical invasion or
Q. Two state colleges in Bataan. It was under the name of the province. usurpation of his property
Garcia sponsored a bill creating 1 state college. Those two schools were o Which can only be exercised at the time of actual or
integrated into one. The lands where the two schools were situated were threatened dispossession
given to the created state college free of charge. The newly formed state o Not when possession has already been lost.
college demanded the titles to the province. The LGU refused, saying  The owner must resort to judicial process for the
those properties were patrimonial since they were mortgaged to secure recovery of property. (German Management & Services
their loan to Landbank. v. CA)
A. Province of Bataan is wrong. Those properties are for public use.  Repel – threatened invasion – threat
Thus, Congress has absolute control over it and may dispose of it.  Prevent – actual physical invasion or usurpation – ongoing
Prior Plaintiff must prove Plaintiff need not have been

Is this a defense in criminal law? No need for an attack on the person of Physical he was in prior in prior physical possession
the property owner. Possession physical possession
of the premises
(3) Doctrine of State of necessity Possession Possession of land Possession of defendant is
of defendant by defendant is inceptively lawful but it
ARTICLE 432, NCC. The owner of a thing has no right to prohibit unlawful from the becomes illegal by
the interference of another with the same, if the interference is beginning. reason of termination of
necessary to avert an imminent danger and the threatened damage, his right to possession of
compared to the damage arising to the owner from the interference, Thru FISTS (Force, the property under his
is much greater. The owner may demand from the person benefited Intimidation, contract.
indemnity for the damage to him. Strategy, Threat,
 The owner CANNOT PROHIBIT INTERFERENCE BY ANOTHER Stealth)
if the same is necessary to avert an imminent danger and the Demand to No need for Demand is jurisdictional in
threatened damage, compared to the damage arising to the vacate previous demand to nature.
owner from the interference, is much greater. vacate the premises
 The owner may demand from the person benefited indemnity for Prescriptive GR: 1 year from the Date of the last demand by
the damage to him. Period lawful owner is the lawful possessor
dispossessed
(4) Requisites of State of Necessity EXC: If by stealth,
from the discovery
(1) There is a situation of grave peril, an actual or imminent of the
danger, either upon the person of the actor or a third person or dispossession
their property Mirallosa v. Carmel Development, Inc.
(2) Interference is necessary to avert such danger
(3) The threatened damage, compared to the damage arising to CivPro Review
the owner from the interference, is much greater ACCION INTERDICTAL (Rule 70)
(4) State of necessity is not brought about by the intentional  a person deprived of the possession of any land or building
provocation of the party invoking the same. (People v. o by force, intimidation, threat, strategy, or stealth, or
Retubado)  a lessor, vendor, vendee, or other person against whom the
possession of any land or building is unlawfully withheld after
Q. Can there be a conflict in the application of the state of necessity and the expiration or termination of the right to hold
self-help? Can the owner invoke self-help against the doctrine of state possession, by virtue of any contract, express or implied, or
of necessity? NO. In self-help, there must an unlawful actual physical
invasion. In the doctrine of state of necessity, the invasion is lawful. (c) Jurisdiction: Always with the MTC
Q. What if the danger came from the property itself which was subjected Accion Publiciana
to interference? Will that require compensation to the owner? NO. If the (a) Concept:
danger comes from the property itself, this is not a state of necessity.  An accion publiciana is a plenary action to recover the right of
That is self-defense. possession, and the issue is which party has the better right of
possession (possession de jure).
3. Right to Recover (IPR)  It is also used to refer to an ejectment suit where
o the cause of dispossession is not among the grounds for
Basic Rule forcible entry and unlawful detainer, or
ARTICLE 536, NCC. In no case may possession be acquired through o possession has been lost for more than one year and the
force or intimidation as long as there is a possessor who objects action can no longer be maintained under Rule 70.
thereto. He who believes that he has an action or a right to deprive  The objective of the plaintiff in accion publiciana is to recover
another of the holding of a thing, must invoke the aid of the competent possession only, not ownership.
court, if the holder should refuse to deliver the thing.
Two Kinds
If personal property – replevin  De jure: better right of possession
 De facto: dispossession has lasted for more than one year (or less
If real property than a year in cases other than those in Rule 70)
Accion Interdictal (b) Jurisdiction

(a) Concept: Limited to right to physical possession or possession  It is an action involving title to or possession of real property.
de facto, independently of any claim of ownership. The action is
 MTC – if the assessed value of the property does not exceed 20K,
either:
or 50K for actions filed in Metro Manila
(1) Forcible entry (FE)
 RTC – otherwise
(2) Unlawful Detainer (UD)
Accion Reinvindicatoria
(b) Distinctions
(a) Concept
Forcible Entry Unlawful Detainer
 a suit which has for its object the recovery of possession over
the real property as owner. It involves recovery of ownership and
possession based on the said ownership.
(4) Reasonable requirements of aerial navigation

(b) Requisites (5) Rights of third persons (Article 431)
ARTICLE 434, NCC. In an action to recover, the property must be (6) Contracts (Ayala v. Ray Burton Dev. Corp.)
identified, and the plaintiff must rely on the strength of his title and
not on the weakness of the defendant’s claim. ARTICLE 431, NCC. The owner of a thing cannot make use thereof
in such manner as to injure the rights of a third person.
The claimant must prove two things:
(1) The identity of the land claimed Right to Sub-Surface
(2) His title thereto.  Rights over lands are indivisible and consequently, requires a
definitive and categorical classification. Land cannot be classified
 In regard to the first requisite, in an accion reinvindicatoria, the as half-agricultural and half-mineral (Republic v. CA 1988, Republic
person who claims that he has a better right to the property must v. Rural Bank of Kabakan)
first fix the identity of the land he is claiming by describing the  In the context of expropriation proceedings, the soil has no value
location, area and boundaries thereof. (Heirs of Tayag v. separate from that of the expropriated land. (Republic v. Rural Bank
Gabriel) of Kabakan)
 With regard to the second requisite, the plaintiff must rely on the  When a landowner cannot dig upon his property motorized deep
strength of his title and not on the weakness of the defendant's wells and was prevented from doing so by the authorities, he is
claim. (VSD Realty v. Uniwide) entitled to recover the full compensation for the land because
the nature of the easement deprives the owner of its normal
(c) Jurisdiction beneficial use. (NAPOCOR v. Ibrahim)
 It is an action involving title to or possession of real property.
 MTC – if the assessed value of the property does not exceed 20K, Right to Hidden Treasure
or 50K for actions filed in Metro Manila ARTICLE 438, NCC. Hidden treasure belongs to the owner of the
 RTC – otherwise land, building, or other property on which it is found.
(d) Registered owner’s action imprescriptible Nevertheless, when the discovery is made on the property of another,
An action by the registered owner to recover a real property registered or of the State or any of its subdivisions, and by chance, one-half
under the Torrens System does not prescribe. (Aledro-Runa v. Lead thereof shall be allowed to the finder. If the finder is a trespasser, he
Export) shall not be entitled to any share of the treasure.
Not collateral Attack If the things found be of interest to science or the arts, the State may
 In an action for forcible entry or unlawful detainer and accion acquire them at their just price, which shall be divided in conformity
publiciana, the objective of the plaintiffs in accion publiciana is with the rule stated.
to recover possession only, not ownership.
o The adjudication is not conclusive on the issue of ARTICLE 439, NCC. By treasure is understood, for legal purposes,
ownership. any hidden and unknown deposit of money, jewelry, or other
 the defense of ownership (i.e., that the defendant, and not the precious objects, the lawful ownership of which does not
plaintiff, is the rightful owner) will not trigger a collateral attack on appear.
the plaintiffs Torrens or certificate of title because the resolution of
the issue of ownership is done only to determine the issue of Definition
possession.  A hidden treasure is:
 In an accion Reinvindicatoria, the court where the reivindicatory o any deposit of money, jewelry, or other precious objects,
or reconveyance suit is filed has the requisite jurisdiction to rule which must be hidden and unknown
definitively or with finality on the issue of ownership — it can o the lawful ownership of which does not appear.
pass upon the validity of the plaintiff's certificate of title. Hence,
there is no collateral attack. If the finding of the treasure is by chance:
 If the finder is the owner of the property on which the treasure is
4. Right to Surface, Sub-surface, and Airspace found, the treasure is all his.
 If the finder is a trespasser, the treasure belongs to the owner of
Rule the property on which the treasure is found.
ARTICLE 437, NCC. The owner of a parcel of land is the owner of  If the finder is not a trespasser, the finder is entitled to ½ of the
its surface and of everything under it, and he can construct treasure and the other half goes to the owner of the property.
thereon any works or make any plantations and excavations
which he may deem proper, without detriment to servitudes and If the search for hidden treasure is deliberate
subject to special laws and ordinances. He cannot complain of the  “Treasure Hunting” permit must be obtained from the National
reasonable requirements of aerial navigation. Heritage Commission if the activity is for the purpose of
recovering treasures which are of cultural and historical
The owner of a piece of land has rights not only to its surface but values. (RA 8492)
also to everything underneath and the airspace above it up to a  Otherwise, the permit must be obtained from the DENR (DENR AO
reasonable height. 2002-04, as amended by DENR AO 2004-2003, in relation to EO
35, dated September 15, 2001)
Limitations (Republic v. CA 1988)
(1) Servitudes or easements CC. Accession
(2) Special laws
(3) Ordinances 1. Basic Concept
(5) Fruits naturally falling upon adjacent land belong to the owner
Definition of the said land and not the owner of the tree. (Art. 681)
ARTICLE 440, NCC. The ownership of property gives the right by
accession to everything which is produced thereby, or which is Three Kinds of Fruits
incorporated or attached thereto, either naturally or artificially. ARTICLE 442, NCC. Natural fruits are the spontaneous products of
the soil, and the young and other products of animals.
Accession is the right of the owner of a thing to become the owner of
everything that is produced thereby or which may be inseparably Industrial fruits are those produced by lands of any kind through
attached or incorporated thereto, either naturally or artificially. cultivation or labor.
Kinds of Accession Civil fruits are the rents of buildings, the price of leases of lands and
(1) Accession discreta – the right of the owner of a property to other property and the amount of perpetual or life annuities or other
whatever is produced thereby or to the fruits of the same. similar income.
(2) Accession continua – the right to acquire whatever is attached
or incorporated naturally or artificially to our things. ARTICLE 444, NCC. Only such as are manifest or born are
considered as natural or industrial fruits.
Forms of Accession Continua
Accession continua may refer to: With respect to animals, it is sufficient that they are in the womb of
(1) Immovable Property the mother, although unborn.
(a) Accession Industrial – may take the form of the (BPS)
(i) Building (1) Natural Fruits
(ii) planting, or  Spontaneous products of the soil, or those that appear without
(iii) sowing the intervention of huma labor.
(b) Accession Natural – may either be (AACF) o Ex. Wild fruits in the forest, herbs, common grass, young and
(i) Alluvion other products of animals, such as milk, hair, wool, horn, hide,
(ii) Avulsion eggs, and animals dung or manure.
(iii) Change of course of River  If the young or offspring is a product of animals belonging to
(iv) Formation of Islands different owners, the young belongs to the owner of the female
(2) Movable Property (ACS) parent, in the absence of agreement to the contrary
(a) Adjunction or conjunction – may take place by o “Partus sequitur ventrem” – the offspring follows the condition
(i) Inclusion or engraftment of the mother. (US v. Caballero)
(ii) Soldadura or attachment
(iii) Tejido or weaving (2) Industrial Fruits
(iv) Pintura or painting  those produced by lands of any kind through cultivation or
(v) Escritura or writing labor
(b) Commixion or confusion
(c) Specification (3) Civil Fruits
 rents of buildings, the price of leases of lands and other
2. Accession Discreta property and the amount of perpetual or life annuities or other
similar income.
Basic Rule  Rent is a civil fruit that belongs to the owner of the property
ARTICLE 441, NCC. To the owner belongs: producing it by right of accession. Hence, in case of dispute over
(1) The natural fruits; its ownership, the rightful recipient of the disputed rent should
(2) The industrial fruits; be the owner of the subject lot at the time the rent accrued.
(3) The civil fruits. (PNB v. Maranon.)
 Bank interest partake the nature of civil fruits under Art. 442.
 Accession is the right of the owner of a thing to become the owner Since these are considered fruits, the ownership thereof should be
of everything that is produced thereby or which may be due to the owner of the principal. (Republic v. Holy Trinity Realty)
inseparably attached or incorporated thereto, either naturally or
artificially. Expenses in Production, Gathering, and Preservation
 To the owner belongs: natural, industrial, and civil fruits. ARTICLE 443, NCC. He who receives the fruits has the obligation to
pay the expenses made by a third person in their production,
Exceptions gathering, and preservation.
(1) In usufruct, the usufructuary shall be entitled to all the natural,
industrial, and civil fruits of the property in usufruct. (Art. 526)  Where the recipient of the fruits was not the same person who
(2) In lease of rural land, the lessee is entitled to the natural and incurred the expenses in connection with its production,
industrial fruits of the thing leased. The lessor is entitled to the gathering, and preservation, the former has the obligation to pay
civil fruits in the form of rent paid by the lessee. (Art. 1654, 1676, the expenses made by the latter, whether the latter acted in good
par. 2) faith or in bad faith.
(3) In antichresis, the creditor acquires the right to receive the fruits
 This rule applies only when the fruits are already harvested and
of an immovable of his debtor, with the obligation to apply
gathered.
them to the payment of the interest, if owing, and thereafter, to
 GR: This will not apply to a possessor in good faith because
the principal of his credit. (Art. 2132)
ordinarily he is entitled to the fruits received by him at the time he
(4) A possessor in good faith is entitled to the fruits received by him
was acting in good faith. (544)
before his possession is legally interrupted. (Art. 544)
o EXC: He can return the fruits to the lawful possessor.
 Will 443 apply to a possessor in bad faith? YES shall agree upon the terms of the lease and in case of disagreement,
o He may be compelled to return the fruits actually received and the court shall fix the terms thereof.
could’ve been received to the lawful possessor.
 Ex. The LP could not receive the fruits due to the  Applies when the Builder, Planter, Sower (BPS) builds, plants, or
negligence of the possessor in bad faith. sows on the land of another (LO) with his own materials, and
 443 applies only to accession discreta – fruits already harvested, both acted in good faith.
gathered, and turned over to the possessor
Where 448 applies
3. Industrial Accession  LO and Builder in good faith (traditional concept)
o Builder believes he had a title / mode of ownership
(a) Article 447  Express consent of LO
ARTICLE 447, NCC. The owner of the land who makes thereon,  Both of them acted in bad faith
personally or through another, plantings, constructions or works with o Owner allowed the building, planting, sowing without objection
the materials of another, shall pay their value; and, if he acted in bad
faith, he shall also be obliged to the reparation of damages. The (1) Concept of BPS in good faith
owner of the materials shall have the right to remove them only in  Limited definition: The builder believes that he is the owner of
case he can do so without injury to the work constructed, or without the land or that by some title he has the right to build thereon,
the plantings, constructions or works being destroyed. However, if or that, at least he has a claim thereto (Community Cagayan Inc,
the landowner acted in bad faith, the owner of the materials may v. Nanol)
remove them in any event, with a right to be indemnified for damages. o Such as when the builders constructed their house on the
 Applies when the landowner (LO) builds, plants, or sows on his land adjacent lot because the geodetic engineer erroneously
with materials belonging to the owner of materials (OM). pointed to said lot as the one purchased by the builders.
(Rosales v. Castelltort)
Three Situations o 526 NCC: He is deemed a possessor in good faith who is not
Both acted in LO must appropriate materials BUT must pay aware that there exists in his title or mode of acquisition any
good faith or bad for its value. flaw which invalidates it.
faith  Title: any juridical act, not sufficient to transfer
He has no choice because he can no longer ownership, but may be a way to transfer ownership (like
separate the materials. (Accession) contracts)
 LO acted in  OM will lose his materials without the right  Expanded Definition: a builder in bad faith may be entitled to the
good faith to be indemnified benefits of a builder in good faith
 OM acted in  He will be liable to pay damages o Express Consent: Where the builders knew they were not
bad faith the owners of the land BUT they constructed the
 LO acted in OM has the option to improvements on the land of another with the consent of the
bad faith  demand the value of his materials and owner (Aquino v. Aguilar), such as when the landowner
 OM acted in damages OR allowed his or her children to construct their house on the
good faith  Demand the return of his accessory thing land he or she owns (Macasaet v. Macasaet).
in any event, even if injury is caused to the  Does not apply when the one who gave consent to the
land, at the expense of LO, plus damages. construction was a complete stranger to the builders.
(Padilla, Jr. v. Malicsi)
LO
 Good faith – Involving Rights of Repurchase
o NOTE: Accession presupposes absence of consent ARTICLE 1606, NCC. The right referred to in article 1601, in the
o LO thought the materials were his absence of an express agreement, shall last four years from the date
 Bad faith of the contract.
o LO knew he did not own the materials
Should there be an agreement, the period cannot exceed ten years.
OM
 Bad faith – he knew the LO used his materials, and he made no However, the vendor may still exercise the right to repurchase within
objection thirty days from the time final judgment was rendered in a civil action
on the basis that the contract was a true sale with right to repurchase.
 Good faith - he was not aware that someone made use of his
materials
ARTICLE 1616, NCC. The vendor cannot avail himself of the right of
(b) Article 448 repurchase without returning to the vendee the price of the sale, and
ARTICLE 448, NCC. The owner of the land on which anything has in addition:
been built, sown or planted in good faith, shall have the right to (1) The expenses of the contract, and any other legitimate
appropriate as his own the works, sowing or planting, after payments made by reason of the sale;
payment of the indemnity provided for in articles 546 and 548, or to (2) The necessary and useful expenses made on the thing sold.
oblige the one who built or planted to pay the price of the land,
and the one who sowed, the proper rent. However, the builder or  448 is inapplicable in cases involving contracts of sale with right
planter cannot be obliged to buy the land if its value is considerably of repurchase.
more than that of the building or trees. In such case, he shall pay  When the vendee a retro introduced improvements on the property
reasonable rent, if the owner of the land does not choose to prior to repurchase, Articles 1606 and 1616 require the vendor a
appropriate the building or trees after proper indemnity. The parties retro to also pay the necessary and useful expenses made on
the thing sold. (Narvaez v. Alciso)
Involving the Contract of Lease Involving Condominium Act

ARTICLE 1678, NCC. If the lessee makes, in good faith, useful  When a condominium unit owner introduced an improvement on
improvements which are suitable to the use for which the lease is his unit, 448 does not apply.
intended, without altering the form or substance of the property  Condominium Act and the Master Deed and the By-Laws of the
leased, the lessor upon the termination of the lease shall pay the condominium corporation (Leviste Management System, Inc. v.
lessee one-half of the value of the improvements at that time. Should Legaspi)
the lessor refuse to reimburse said amount, the lessee may remove  Legaspi constructed 3 additional units on the roof deck of the
the improvements, even though the principal thing may suffer condominium units. LPL purchased 1 of those units (concession 3).
damage thereby. He shall not, however, cause any more impairment It constructed another unit of concession 3. Legaspi demanded the
upon the property leased than is necessary. demolition of the illegal structure. LPL says that whoever owns the
surface of the land, owns also the airspace. Thus, LPL believed it
With regard to ornamental expenses, the lessee shall not be entitled owned the airspace over the unit.
to any reimbursement, but he may remove the ornamental objects,  This is WRONG. What is included in the unit is only what is inside
provided no damage is caused to the principal thing, and the lessor the unit (floor, ceiling, walls, doors, windows). Anything outside is
does not choose to retain them by paying their value at the time the the COMMON AREA which pertains to the corporation.
lease is extinguished.
When Ownership of Land is Lost
 When the lessee introduced an improvement on the leased  448 when the LO loses ownership of his land because of non-
premises, the applicable law is Article 1678, not 448. payment of real estate taxes to settle the controversy with respect
 Under 1678, the lessor has the option of (primary right): to the improvement on the land. (Pecson v. CA)
(a) appropriating the useful improvements by paying ½ of their
value at the time OR When Builder is Co-owner
(b) to allow the lessee to remove the improvements.  Ordinarily, 448 does not apply because he is a builder-owner.
 In the removal of the useful improvements, the lessee  EXC: Applies to one whose house, despite having been built at the
can cause damage to the leased premises so long as time he was still co-owner, overlapped with the land of another.
the injury is related to the removal. (Sps. Del Campo v. Abesia)
 Otherwise, the lessee is liable to the lessor for damages.
 In case of ornamental improvement, the lessor has the option of Successor in Interest
o appropriating the ornaments by paying their full value at  448 can be invoked by the successor-in-interest of the builder
that time or in good faith. (Technogas PH Manufacturing Corp. v. CA)
o to allow the lessee to remove the ornamental objects, if
removal can be done without damaging the leased Q. Will 448 apply if the parties are governed by a contract? NO. The law
premises. on accession will not apply.
448 will not apply if there is a special law applicable to the situation.
Q. In the case of a lessee, is he entitled to reimbursement of the useful
expenses they incurred? NO. They are related to the lessor by contract. (2) Two Options of Land Owner
They can stay on the property simply by introducing improvements and
demanding reimbursement. [1] To appropriate as his own the works, sowing or planting, after
payment to the BSP the necessary and useful expenses, and in proper
Involving Usufruct cases, expenses for pure luxury or mere pleasure, incurred by the latter;
ARTICLE 579, NCC. The usufructuary may make on the property
held in usufruct such useful improvements or expenses for mere [2] to oblige the one who built or planted to pay the price of the
pleasure as he may deem proper, provided he does not alter its form land, if the value of the land is not considerably more than that of
or substance; but he shall have no right to be indemnified therefor. the building or trees, and the one who sowed, the proper rent.
He may, however, remove such improvements, should it be possible  Options belong to LO because his right is older (Depra v. Dumlao),
to do so without damage to the property. and such rule is in accord with the principle of accession
o the accessory follows the principal. (Community Cagayan)
 When a usufructuary introduced useful improvements or  The option is preclusive.
ornaments on the property subject matter of the usufruct, the o LO cannot refuse to exercise any of the 2 options.
applicable laws are Articles 579 and 580, not 448. o He cannot compel the owner of the building to remove the
 The usufructuary may building from the land without exercising either option. It
o remove the improvements if it will not injure the principal is only when the owner chooses to sell his land, and the
thing, OR builder or planter fails to purchase it (and its value is not more
o offset such improvements against any damage he may than the value of the improvements), that the owner may
have caused to the property. remove the improvements. (Torbela v. Rosario)
Q. Can the usufructuary be prevented from removing the Q. Is the LO entitled to the payment of rentals? Only from the time that
improvements? NO. This is the only right of removal that cannot be the good faith of the builder was converted into bad faith UNTIL the
prevented by the owner. election of the option by the LO. Upon the election of the option, the
builder has the right of retention.
ARTICLE 580, NCC. The usufructuary may set off the improvements
he may have made on the property against any damage to the same. (3) Option of Appropriation
If he causes damage, he may simply off-set the damage with the

improvements.
 LO must pay the necessary and useful expenses, and in the

proper case, expenses for pure luxury or mere pleasure. 449 – fruits are still pending
(Ballatan v. CA)
o The basis of indemnity is the current market value of the Concept of Builder in bad faith
improvements at the time of the election of the option.  If BPS knew he was not the owner of the land at the time of the
(Pecson v. CA) building, planting, and sowing, and the LO had no knowledge of
 Pending payment of the indemnity, the builder is entitled to a what he did at that time, such as when the buyers of a parcel of
right of retention of the property. (Filipinas Colleges, Inc. v. land constructed a house even if they were not innocent purchasers
Timbang) for value (Heirs of Sarili v. Lagrosa), or the builder’s occupation
o In relation to the right to reimbursement of the necessary and of the property was by mere tolerance. (Esmaquel v. Coprada)
useful expenses incurred by a possessor in good faith
 Accordingly, the builder in good faith cannot be compelled to Three Options of Landowner
pay rentals during the period of retention nor be disturbed in his (1) The right to appropriate whatever has been built, planted, or sown
possession by ordering him to vacate. in bad faith without need of paying indemnity, plus damages,
and that the builder in bad faith has no right to a refund of any
(4) Option of Selling Land improvement built therein.
(a) If there are pending fruits, the LO is entitled to appropriate
 This is not a voluntary sale. them without need of paying any indemnity.
 Can only be exercised against the builder or planter and only when (2) The right to demand the demolition of whatever has been built,
the value of the land is not considerably more than the planted, or sown in bad faith in any event – even if damages will
building or planting. be caused by the separation – plus damages.
o Otherwise, the builder or planter can only be compelled to pay (3) The right to compel the builder or planter in bad faith to pay
proper rent. the price of the land, even if the price of the land is
o In determining the price of the land, the price must be fixed at considerably more than the building or trees, plus damages.
the “prevailing market value” at the time of the election of
the option. (Vda. De Roxas v. Our Lady’s Foundation, Inc.) Only right of BPS in bad faith
o If the builder or the planter refuses to pay the price of the  Reimbursement of necessary expenses of preservation of the
land, the LO does not automatically become the owner of land.
the improvements without paying indemnity. (Filipinas  BUT he does not have the right of retention over the premises.
Colleges v. Timbang)
 Options: If BPS in good faith
 Choose option of appropriation (1) Removal
 Enter into a voluntary lease contract with builder (2) Reimbursement of materials
or planter (Miranda v. Fadullon)
 The LO may demand for the demolition of what (d) Article 453
has been built or planted (Ignacio v. Hilario) ARTICLE 453, NCC. If there was bad faith, not only on the part
 Apply for an order from the court for the sale of of the person who built, planted or sowed on the land of another,
the land and improvement in a public auction but also on the part of the owner of such land, the rights of one
applying the proceeds thereof first to the payment and the other shall be the same as though both had acted in good
of the value of the land and the excess to be faith.
delivered to the owner of the house in payment
thereof. (Bernardo v. Bataclan) It is understood that there is bad faith on the part of the landowner
whenever the act was done with his knowledge and without
(c) Articles 449-452 opposition on his part.
ARTICLE 449, NCC. He who builds, plants or sows in bad faith on
the land of another, loses what is built, planted or sown without right  Applies when BPS builds, plants, or sows on the land of another
to indemnity. (LO) with his own materials and both acted in bad faith.
 Bad faith of each is cancelled out.
ARTICLE 450, NCC. The owner of the land on which anything has o The rights of one and the other shall be the same as though
been built, planted or sown in bad faith may demand the demolition both had acted in good faith.
of the work, or that the planting or sowing be removed, in order to o Hence, 448 will be applicable.
replace things in their former condition at the expense of the person
who built, planted or sowed; or he may compel the builder or planter (e) Article 454
to pay the price of the land, and the sower the proper rent. ARTICLE 454, NCC. When the landowner acted in bad faith and
the builder, planter or sower proceeded in good faith, the
ARTICLE 451, NCC. In the cases of the two preceding articles, the provisions of article 447 shall apply.
landowner is entitled to damages from the builder, planter or sower.
 Applies when BPS builds, plants, or sows on the land of another
ARTICLE 452, NCC. The builder, planter or sower in bad faith is (LO) with his own materials and he acted in good faith while the LO
entitled to reimbursement for the necessary expenses of acted in bad faith.
preservation of the land.  Article 477 shall apply.
Both acted in LO must appropriate materials BUT must pay
 Applies when the BPS builds, plants, or sows on the land of good faith or bad for its value.
another (LO) with his own materials and he acted in bad faith faith
while the LO acted in good faith.
 LO acted in  OM will lose his materials without the right (2) Accretion is the process whereby the soil is deposited
good faith to be indemnified along the banks of rivers. (Delos Reyes v. Municipality of
 OM acted in  He will be liable to pay damages Kalibo)
bad faith
 LO acted in OM has the option to (b) Rule on Alluvion
bad faith  demand the value of his materials and ARTICLE 457, NCC. To the owners of lands adjoining the banks of
 OM acted in damages OR rivers belong the accretion which they gradually receive from the
good faith  Demand the return of his accessory thing effects of the current of the waters.
in any event, even if injury is caused to the  Additional soil deposit becomes private property and shall
land, at the expense of LO, plus damages. belong to the owner of the land contiguous to the river, creek,
stream, or lake.
 BPS has two options:  If the accretion is on the sea, it’s public domain
o To demand the value of his materials and reasonable
compensation for his labor, plus damages; OR (c) Requisites
o To demand the return of his materials in any event, plus (1) The accumulation of soil or sediment is gradual and
damages. imperceptible.
 Bad faith is may only be attributed to an LO when the act of (2) It is the exclusive result of the action of the waters.
building, planting, or sowing was done with his knowledge (3) The land where the accretion takes place is adjacent to the
and without opposition on his part. (Dinglasan-Delos Santos v. bank of the river, creek, stream, or lake shore.
Abejon)  The drying up of the river is not accretion. (Republic v. Santos
III)
(f) Article 455 o The process of drying up of a river to form dry land involved
ARTICLE 455, NCC. If the materials, plants or seeds belong to a the recession of the water level from the river banks.
third person who has not acted in bad faith, the owner of the o In accretion, the water level did not recede and was more or
land shall answer subsidiarily for their value and only in the event less maintained.
that the one who made use of them has no property with which  Alluvion must be the exclusive work of nature.
to pay. o Where the land was formed with the help of human
intervention, it becomes part of the public domain. (Vda. De
This provision shall not apply if the owner makes use of the right Nazareno v. CA)
granted by article 450. If the owner of the materials, plants or seeds
has been paid by the builder, planter or sower, the latter may demand (d) Ownership is Acquired Ipso Jure
from the landowner the value of the materials and labor.  The right of the owners of the land adjacent to the rivers, creeks,
streams, or lakes to the accretion which they receive by virtue of
 Applies when BPS builds, plants, or sows on the land of the action of the waters of the river is ipso jure. (Roxas v. Tuason)
another (LO) using materials belong to another person (OM).  BUT, the accretion to registered land does not preclude
acquisition of the additional area by another person through
1 OM acted He loses his materials in favor of LO without any prescription. (Reynante v. CA)
in bad right and he is liable for damages. o It is not automatically registered in his name. Thus, it may be
faith subject to acquisitive prescription.
BPS BPS may claim from LO a reasonable
acted in compensation for his labor. Otherwise, he is not [2] Avulsion
good faith entitled to such compensation (a) Definition
2 OM acted He must be paid the value of his materials. It is the accretion which takes place when the current of a river, creek,
in good or torrent segregates a known portion of land from an estate on its
faith banks and transfers it to another estate.
BPS BPS is primarily liable to make such payment,
while LO is subsidiarily liable. (b) Rule on Avulsion
 Subsidiary liability of LO will attach only if ARTICLE 459, NCC. Whenever the current of a river, creek or torrent
the following conditions are met: segregates from an estate on its bank a known portion of land and
o BPS is insolvent; AND transfers it to another estate, the owner of the land to which the
o LO chooses to appropriate the segregated portion belonged retains the ownership of it, provided that
building, planting, or sowing. he removes the same within two years.
 If BPS pays the materials, the rights and
obligations of BPS and LO to each other shall ARTICLE 460, NCC. Trees uprooted and carried away by the current
be determined under 448-454. of the waters belong to the owner of the land upon which they may
 If LO pays the materials, he will have to pay be cast, if the owners do not claim them within six months. If such
BPS for the latter’s labor depending on his owners claim them, they shall pay the expenses incurred in gathering
good faith or bad faith. them or putting them in a safe place.
4. Natural Accession  The owner of the land from where the portion is detached
retains ownership thereof.
[1] Alluvium o BUT he is required to physically remove the same within 2
(a) Distinguished from Accretion years.
(1) Alluvium is the soil deposited on the estate fronting the  In case of uprooted trees, a mere claim by the owner within 6
river bank. (Heirs of Navarro v. IAC) months is sufficient to retain ownership of the tree.
ARTICLE 465, NCC. Islands which through successive accumulation

Delayed accession of alluvial deposits are formed in non-navigable and non-floatable
rivers, belong to the owners of the margins or banks nearest to each
(c) Requisites of them, or to the owners of both margins if the island is in the middle
(1) It takes place only along the banks of rivers, creeks, streams, of the river, in which case it shall be divided longitudinally in halves.
and lakes. If a single island thus formed be more distant from one margin than
(2) It is caused only by the force of the current of the water from the other, the owner of the nearer margin shall be the sole owner
independently of the act of man. thereof.
(3) The deposit of soil is sudden and abrupt.
(4) The detached portion can be identified. An island formed through in non-navigable or non-floatable rivers shall
 In the absence of evidence that the change in the course of river become private property, as follows:
was sudden or that it occurred through avulsion, the presumption (1) The island belongs to the owners of the margins or banks
is that the change was gradual and caused by accretion and nearest to the island
erosion. (CN Hodges v. Garcia) (2) If the island is in the middle of the river, it shall belong to the
owners of both margins, in which case it shall be divided
[3] Change of Course of Rivers longitudinally in halves.
(a) GR: Rivers and their natural beds are property of public dominion (3) If a single island formed be more distant from one margin than
of the State (Article 502, Water Code) from the other, the owner of the nearer margin shall be the sole
(b) EXC: Abandoned River beds through a natural change and owner.
occupying private property
ARTICLE 461, NCC. River beds which are abandoned through the 5. Accession Continua with Respect to Movables
natural change in the course of the waters ipso facto belong to
the owners whose lands are occupied by the new course in Adjunction
proportion to the area lost. However, the owners of the lands (a) Concept: It takes place when 2 movables belonging to different
adjoining the old bed shall have the right to acquire the same by owners are so inseparable that their separation would impair
paying the value thereof, which value shall not exceed the value of their nature, making up a single object, but each preserving its own
the area occupied by the new bed. nature.
(c) Requisites (b) If effected in good faith

Claimant must prove 3 elements by clear and convincing evidence: ARTICLE 466. Whenever two movable things belonging to different
(1) The old course of the river or creek owners are, without bad faith, united in such a way that they form a
(2) The new course of the river or creek single object, the owner of the principal thing acquires the
(3) The change of course of the river or creek from the old location accessory, indemnifying the former owner thereof for its value.
to the new location by natural occurrence.
(Galang v. Reyes) ARTICLE 469. Whenever the things united can be separated
without injury, their respective owners may demand their
 461 will still apply even if the change in the course was the result separation.
of a deliberate act on the part of the government. (Baes v. CA)
 BUT it will not apply when the drying up of the river was without the Nevertheless, in case the thing united for the use, embellishment
intervention of the government but was caused by the dumping of or perfection of the other, is much more precious than the
garbage by the people of the surrounding neighborhood. principal thing, the owner of the former may demand its
(Ronquillo v. CA) separation, even though the thing to which it has been incorporated
may suffer some injury.
(d) When River simply dries up
 If the river dries up and does not change its course or does not  The owner of the principal thing acquires the accessory by
open a new bed, 461 will not apply. (Republic v. Santos III) indemnifying the former of the value of the accessory.
 The dried up river belongs to the State, whether the drying up of a  If the accessory is much more precious than the principal, its owner
river is by reason of nature or the intervention of man. ((Celestial v. may demand its separation, even though the thing to which it has
Cachopero) been incorporated may suffer some injury.
[4] Formation of Islands (c) If effected in bad faith

(a) Article 463 ARTICLE 470, NCC. Whenever the owner of the accessory thing
ARTICLE 463, NCC. Whenever the current of a river divides itself has made the incorporation in bad faith, he shall lose the thing
into branches, leaving a piece of land or part thereof isolated, incorporated and shall have the obligation to indemnify the owner of
the owner of the land retains his ownership. He also retains it if a the principal thing for the damages he may have suffered.
portion of land is separated from the estate by the current.
If the one who has acted in bad faith is the owner of the principal
(b) Article 464 thing, the owner of the accessory thing shall have a right to choose
ARTICLE 464, NCC. Islands which may be formed on the seas between the former paying him its value or that the thing belonging
within the jurisdiction of the Philippines, on lakes, and on navigable to him be separated, even though for this purpose it be necessary
or floatable rivers belong to the State. to destroy the principal thing; and in both cases, furthermore, there
 As patrimonial property shall be indemnity for damages.
(c) Article 465

If either one of the owners has made the incorporation with the different kind, shall appropriate the thing thus transformed as his
knowledge and without the objection of the other, their respective own, indemnifying the owner of the material for its value.
rights shall be determined as though both acted in good faith.
If the material is more precious than the transformed thing or is of
Bad faith more value, its owner may, at his option, appropriate the new thing
(1) By the owner of the accessory to himself, after first paying indemnity for the value of the work, or
(a) he shall lose his thing and demand indemnity for the material.
(b) he shall be liable for damages
(2) By the owner of the principal, the owner of the accessory has the If in the making of the thing bad faith intervened, the owner of the
option of material shall have the right to appropriate the work to himself without
(a) Demanding payment for the value of the accessory, plus paying anything to the maker, or to demand of the latter that he
damages; OR indemnify him for the value of the material and the damages he may
(b) Demanding separation, even if the same will result in injury have suffered. However, the owner of the material cannot appropriate
to the principal thing, plus damages. the work in case the value of the latter, for artistic or scientific
(i) This option does not apply if the same is not reasons, is considerably more than that of the material.
practicable as in the case of paintings or writings.  GR: He shall appropriate the thing thus transformed as his
(ii) In such a situation, the owner of the accessory is limited own, indemnifying the owner of the material for its value.
to the first option. o EXC: When the material is more precious than the
transformed thing or more valuable, its owner may:
Commixtion or Confusion  Appropriate the new thing to himself after paying
(a) Concept indemnity for the value of the work; OR
 Commixtion/confusion is the mixture of things solid or liquid  Demand indemnity for the material.
pertaining to different owners.
o Commixtion – solid (c) If worker acted in bad faith
o Confusion – liquid The owner of the material has two options:
 To appropriate the work for himself without paying anything to the
(b) When co-ownership arises maker; OR
ARTICLE 472. If by the will of their owners two things of the same or  To demand of the latter that he indemnify him for the value of the
different kinds are mixed, or if the mixture occurs by chance, and in material and the damages he may have suffered.
the latter case the things are not separable without injury, each o EXC: In case the value of the work, for artistic or scientific
owner shall acquire a right proportional to the part belonging to reasons, is considerably more than that of the material,
him, bearing in mind the value of the things mixed or confused. (381) the owner of the material cannot appropriate the work.
ARTICLE 473. If by the will of only one owner, but in good faith, two DD. Quieting of Title and Ruinous Buildings and Trees
things of the same or different kinds are mixed or confused, the rights
of the owners shall be determined by the provisions of the preceding 1. Quieting of Title
article.
Definition: a common-law remedy for the removal of any cloud or
If the one who caused the mixture or confusion acted in bad faith, he doubt or uncertainty on the title to real property by reason of any
shall lose the thing belonging to him thus mixed or confused, besides instrument, record, claim, encumbrance, or proceeding that is
being obliged to pay indemnity for the damages caused to the owner apparently valid or effective, but is, in truth and in fact, invalid, ineffective,
of the other thing with which his own was mixed. voidable, or unenforceable, and may be prejudicial to said title. (De
Guzman v. Tabango Realty, Inc.)
If the mixture was caused by:
 Chance or fortuitous event Nature of Action
o Not separable without injury  An action to quiet title is a proceeding quasi in rem.
 By the will of both owners o Actions quasi in rem deal with the status, ownership, or
 By the will of only one owner acting in good faith. liability of a particular property but which are intended to
operate on these questions between the particular parties to
Each owner shall acquire a right proportional to the part belonging the proceedings.
to him, bearing in mind the value of the things mixed or confused.  Hence, the judgment is binding only upon the parties who
joined in the action. (Phil-Ville Development Housing Corp. v.
(c) When caused in bad faith Bonifacio)
If the commixtion or confusion was caused by only one owner acting
in bad faith, he loses the thing belonging to him thus mixed or Jurisdiction
confused, besides being obliged to pay indemnity for the damages  An action for the quieting of title is in the nature of a real action—
caused to the owner of the other thing with which his own was mixed or an action that involves the issue of ownership or possession of
confused. real property, or any interest in real property.
 THUS: jurisdiction is dependent on the assessed value of the
Specification property in dispute. (Salvador v. Patricia, Inc.)
(a) Concept: The imparting of a new form to the material of another.
Requisites for an action to quiet title to prosper
(b) If worker acted in good faith (1) the plaintiff or complainant has a legal or equitable title or
ARTICLE 474, NCC. One who in good faith employs the material interest in the real property subject of the action; and
of another in whole or in part in order to make a thing of a
(2) the deed, claim, encumbrance, or proceeding claimed to be  If he does not comply with the foregoing obligation, the
casting a cloud on his title must be shown to be in fact administrative authorities may order the demolition of the
invalid or inoperative despite its prima facie appearance of structure at his expense, or to take measures to insure public
validity or legal efficacy. safety.
 Legal title: registered ownership  Further, if by reason of lack of necessary repairs, a building or
 Equitable title: beneficial ownership. (Basa v. Loy) structure causes damage resulting from its total or partial collapse,
o If the plaintiffs claim the property as their own as a result the proprietor thereof shall be responsible for the damages.
of acquisitive prescription, the same would give them the
requisite equitable title. (Residents of Lower Atab & Rule on falling trees
Teacher’s Village v. Sta. Monica Industrial & Dev. Corp.) ARTICLE 483, NCC. Whenever a large tree threatens to fall in
such a way as to cause damage to the land or tenement of
Cloud on title another or to travelers over a public or private road, the owner of
A cloud on a title exists when: the tree shall be obliged to fell and remove it; and should he not do
(1) there is an instrument, record, claim, encumbrance, or proceeding; so, it shall be done at his expense by order of the administrative
(2) which is apparently valid or effective; authorities.
(3) but is in truth and in fact invalid, ineffective, voidable, or
unenforceable; and  Whenever a large tree threatens to fall in such a way as to cause
(4) may be prejudicial to the title sought to be quieted. damage to the land or tenement of another or to travelers over
(Ocampo v. Ocampo) a public or private road, the owner of the tree shall be obliged to fell
 Generally, such cloud is not created by mere verbal assertion and remove it
of ownership. o should he not do so, it should be done at his expense by order
o BUT where there is factual basis, such as a claim of right of the administrative authorities.
based on acquisitive prescription, has been held to constitute  In Article 2191 paragraph 3 NCC, proprietors are liable for the
a removable cloud on title. (Tandog v. Macapagal) falling of trees situated at or near highways or lanes, if the same is
not caused by force majeure.
Not collateral attack on title  Under Article 483 NCC, however, the owner shall be deemed
Raising the invalidity of a certificate of title in an action for quieting of title liable even if the reason for the fall be fortuitous event, such as
is NOT a collateral attack because it is central, imperative, and typhoon or earthquake, because in this case the owner is already
essential in such an action that the complainant shows the invalidity negligent for failing to take the necessary measures to insure
of the deed which casts cloud on his title. (Filipinas Eslon Manufacturing public safety.
Corp. v. Heirs of Basilio Llanes)
EE. Co-Ownership
Prescriptive period
ARTICLE 477, NCC. The plaintiff must have legal or equitable title 1. Basic Principles
to, or interest in the real property which is the subject-matter of the
action. He need not be in possession of said property. (a) Definition
Co-ownership is defined as the right of common dominion which two
(1) If plaintiff not in possession: In an action to quiet title, the plaintiff or more persons have in a spiritual part of a thing, not materially or
need not be in possession of the property. physically divided. (Vagilidad v. Vagilidad, Jr.)
(a) If plaintiff is not in possession, the action is indubitably a
real action and shall prescribe after 30 years. ARTICLE 484, NCC. There is co-ownership whenever the ownership
(2) If plaintiff is in possession: The filing of an action to quiet title is of an undivided thing or right belongs to different persons.
imprescriptible because he may wait until his possession is
disturbed or his title is attacked before taking steps to vindicate In default of contracts, or of special provisions, co-ownership shall be
his right. (Syjuco v. Bonifacio) governed by the provisions of this Title.
2. Ruinous Buildings and Falling Trees (b) Requisites

(1) plurality of subjects, who are the co-owners;
Rule on ruinous buildings (2) unity of or material indivision
ARTICLE 482, NCC. If a building, wall, column, or any other (a) there is a single object which is not materially divided, and
construction is in danger of falling, the owner shall be obliged to which is the element that binds the subjects; and
demolish it or to execute the necessary work in order to prevent (3) recognition of ideal shares, which determines the rights and
it from falling. obligations of the co-owners.
(Sanchez v. CA)
If the proprietor does not comply with this obligation, the
administrative authorities may order the demolition of the structure at (c) Consequences
the expense of the owner, or take measures to insure public safety. (1) Rule
 A co-owner of an undivided parcel of land is an “owner of the
ARTICLE 2190, NCC. The proprietor of a building or structure is whole, and over the whole he exercises the right of dominion,
responsible for the damages resulting from its total or partial collapse, but he is at the same time the owner of a portion which is truly
if it should be due to the lack of necessary repairs. abstract. (Sanchez v. CA)
 Rationale: until a division is actually made, the respective share
 Owners of buildings, walls, columns, or other constructions in of each cannot be determined, and every co-owner exercises,
danger of falling are obliged to either: together with his co-participants, joint ownership of the pro
o demolish it or
o execute the necessary work in order to prevent it from falling.
indiviso property, in addition to his use and enjoyment of it.  If the source of co-ownership is contract, the law does not make a
(Torres, Jr. v. Lapinid) distinction as to how the co-owner derived his/her title, may it be
through gratuity or through onerous consideration.
(2) Right to use entire thing o In other words, a person who derived his title and was granted
 A co-owner is entitled to possess and enjoy the entire property. co-ownership rights through gratuity may compel partition.
Hence, he cannot be ejected from the property. (Anzures v. (Logrosa v. Azares)
Ventanilla)  However, mere construction of a house on another’s land, in the
o He can be compelled to pay rentals. absence of agreement, does not create a co-ownership, regardless
of the value of the house. Instead, the situation will be governed by
(3) Limitations Articles 448-454 NCC. (Victoria v. Pidlaoan)
ARTICLE 486, NCC. Each co-owner may use the thing owned in
common, provided he does so in accordance with the purpose for (f) Share in benefits and charges
which it is intended and in such a way as not to injure the interest of ARTICLE 485, NCC. The share of the co-owners, in the benefits as
the co-ownership or prevent the other co-owners from using it well as in the charges, shall be proportional to their respective
according to their rights. The purpose of the co-ownership may be interests. Any stipulation in a contract to the contrary shall be
changed by agreement, express or implied. void.
 it is used for the purpose intended; The portions belonging to the co-owners in the co-ownership shall be
 used in such a way as not to injure the interest of the other co- presumed equal, unless the contrary is proved.
owners; and
 such use does not prevent the other co-owners from making  The share of the co-owner in the thing owned in common is
use thereof according to their own right. determined by their agreement and, in default thereof, such
o Hence, if there is an agreement to lease the house, the co- share shall be presumed to be equal. (Article 285, para. 2 NCC)
owners can demand rent from the co-owner who dwells in the  As to share in benefits and charges, the same should be in
house, (De Guia v. CA) but the latter cannot be ejected from proportion to his interest in the co-ownership. Any stipulation to
the property. (Anzures v. Ventanilla) the contrary is void.
(d) Cannot claim definite portion 2. Consent Requirement

 GR: By the nature of a co-ownership, a co-owner cannot point to
specific portion of the property owned in common as his own Acts Consent
because his share therein remains intangible. (Dalisan v. CA) Action in Ejectment None
 EXC: Where the transferees of an undivided portion of the land Repair for preservation and taxes None
allowed a co-owner of the property to occupy a definite portion Expenses for Improvement and embellishment Majority
thereof, such undisturbed possession had the effect of a partial Pure Luxury
partition of the co-owned property which entitles the possessor Acts of Administration
to the definite portion which he occupies. (Vda. De Cabrera v. CA) Alteration Unanimous
 Effect of sale of concrete portion: Whether the disposition (a) Action in ejectment – no consent
involves an abstract or concrete portion of the co-owned property, ARTICLE 487, NCC. Any one of the co-owners may bring an action
the sale remains validly executed. in ejectment.
o What will be affected on the sale is only his proportionate
share, subject to the results of the partition. Rule: Any one of the co-owners may bring an action in ejectment. A co-
o The co-owners who did not give their consent to the sale owner may thus bring an ejectment action without joining the other
stand to be unaffected by the alienation. (Torres, Jr. v. co-owners, the suit being deemed instituted for the benefit of all.
Lapinid)  Must benefit all: The rule applies so long as the suit is for the
benefit of all. (Plasabas v. CA, Adlawan v. Adlawan)
(e) Sources of co-ownership
o If the action is for the benefit of the plaintiff alone who claims
(1) law;
to be the sole owner, the other co-owners are indispensable
(2) contract; parties who must be impleaded. (Baloloy v. Hular)
(3) succession
 Meaning of “ejectment’’: The term "action in ejectment" includes
ARTICLE 1078, NCC. Where there are two or more heirs, the whole all kinds of actions for the recovery of possession, including an
estate of the decedent is, before its partition, owned in common by accion publiciana and a reinvindicatory action. (Catedrilla v.
such heirs, subject to the payment of debts of the deceased. Lauron)
(a) where there are two or more heirs, the whole estate of the o It will also include an action for revival of judgment if it
decedent is, before its partition, owned in common by such results into the recovery of property. (Basbas v. Sayson)
heirs, subject to the payment of debts of the deceased (Article
1078 NCC); and Effect of judgment:
(4) occupation
 While a co-owner may bring an action in ejectment without the
 such as when two or more persons catch a wild pig or get forest others, any adverse judgment cannot prejudice the rights of
products (Punzalan v. Boon Liat), or the unimpleaded co-owners
 when a hidden treasure is accidentally discovered by a stranger,  BUT any judgment in favor of the co-owner will benefit the
who is not a trespasser, on the land of another. (Art. 438, paragraph others. (Plasabas v. CA), Resuena v. CA, Baloloy v. Hular)
2, NCC)
(b) Repair for preservation and taxes – no consent
Rule
ARTICLE 489, NCC. Repairs for preservation may be made at the  Alterations include any act of strict dominion or ownership and
will of one of the co-owners, but he must, if practicable, first notify any encumbrance or disposition has been held implicitly to be
his co-owners of the necessity for such repairs. Expenses to an act of alteration. (Arambulo v. Nolasco)
improve or embellish the thing shall be decided upon by a
majority as determined in article 492. Unanimous consent required
ARTICLE 491, NCC. None of the co-owners shall, without the
ARTICLE 488, NCC. Each co-owner shall have a right to compel consent of the others, make alterations in the thing owned in
the other co-owners to contribute to the expenses of common, even though benefits for all would result therefrom.
preservation of the thing or right owned in common and to the taxes. However, if the withholding of the consent by one or more of the
Any one of the latter may exempt himself from this obligation by co-owners is clearly prejudicial to the common interest, the
renouncing so much of his undivided interest as may be courts may afford adequate relief.
equivalent to his share of the expenses and taxes. No such waiver
shall be made if it is prejudicial to the co-ownership.  GR: Consent of all co-owners is required to the making of an
alteration on the thing owned in common, even though benefits for
Any repair for the preservation of the property owned in common may all would result from such act.
be made at will by one of the co-owners and he has the right to  The other co-owners may go to court for appropriate relief should
demand contribution from the others for the expenses of preservation any of the co-owners unreasonably withhold his consent and the
and to the taxes. same is clearly prejudicial to the common interest.
Option of co-owner obliged to contribute Effect of unauthorized alteration

Instead of contributing to such expenses, a co-owner may renounce  The act is illegal and invalid and the other co-owners can compel
so much of his interest in the co-ownership as may be equivalent the erring co-owner to undo what has been done, at the latter’s
to his share of expenses and taxes, unless such waiver is prejudicial expense, in addition to recovery of damages.
to the co-ownership.
(e) Acts of administration – MAJORITY
Illustration Concept: Those acts which do not affect the essence, form and
 A co-owner who redeems the property in its entirety during the substance, such as modifications and changes required by the nature of
redemption period does not make him the owner of all of it. The the thing for its exploitation and enjoyment.
property remains in a condition of co-ownership as the redemption
does not provide for a mode of terminating a co-ownership. Requires majority vote
(Paulmitan v. CA) ARTICLE 492, NCC. For the administration and better enjoyment of
 But the one who redeemed has the right to be reimbursed for the the thing owned in common, the resolutions of the majority of the co-
redemption price and until reimbursed, holds a lien upon the owners shall be binding.
subject property for the amount due. (Cabales v. CA)
o Such advance payments are necessary expenses for the There shall be no majority unless the resolution is approved by the
preservation of the co-ownership. (Taghoy v. Tigol, Jr.) co-owners who represent the controlling interest in the object of the
co-ownership.
(c) Expenses for improvement or embellishment - MAJORITY
ARTICLE 492, NCC. For the administration and better enjoyment of Should there be no majority, or should the resolution of the majority
the thing owned in common, the resolutions of the majority of the be seriously prejudicial to those interested in the property owned in
co-owners shall be binding. common, the court, at the instance of an interested party, shall order
such measures as it may deem proper, including the appointment of
There shall be no majority unless the resolution is approved by an administrator.
the co-owners who represent the controlling interest in the object
of the co-ownership. Whenever a part of the thing belongs exclusively to one of the co-
owners, and the remainder is owned in common, the preceding
Should there be no majority, or should the resolution of the majority provisions shall apply only to the part owned in common.
be seriously prejudicial to those interested in the property owned in
common, the court, at the instance of an interested party, shall  With respect to acts of administration and better enjoyment of the
order such measures as it may deem proper, including the thing owned in common, the resolution of the majority of the co-
appointment of an administrator. owners shall be sufficient. (492[1] NCC)
Whenever a part of the thing belongs exclusively to one of the 3. Rights over Ideal Share
co-owners, and the remainder is owned in common, the preceding
provisions shall apply only to the part owned in common. (a) Nature of right
 Must be decided by the majority. (489 NCC)  A co-owner has absolute ownership of his undivided and pro-
 The term "majority of co-owners" means the vote of the co-owners indiviso share in the co-owned property. (Torres, Jr. v. Lapinid;
representing the controlling interest in theobject of co-ownership. City of Mandaluyong v. Aguilar)
(492[2] NCC)
ARTICLE 493, NCC. Each co-owner shall have the full ownership
(d) Acts of alteration - UNANIMOUS of his part and of the fruits and benefits pertaining thereto, and
Concept he may therefore alienate, assign or mortgage it, and even
 An act of alteration is one that affects the substance of the thing substitute another person in its enjoyment, except when personal
and changes its essence and nature. rights are involved. But the effect of the alienation or the
mortgage, with respect to the co-owners, shall be limited to the
portion which may be allotted to him in the division upon the Should two or more co-owners desire to exercise the right of
termination of the co-ownership. redemption, they may only do so in proportion to the share they
may respectively have in the thing owned in common.
 As such, he has the right to alienate, assign, or mortgage it, and
even to substitute another person in its enjoyment, except when  The law grants a co-owner the exercise of said right of redemption
personal rights are involved. when the shares of the other owners are sold to “a third person.”
o Personal rights: the personal relations of one co-owner to (Basa v. Aguilar)
the others, as when the family residence is used by the  A third person, within the meaning of Article 1620 NCC, is anyone
children as co-owners. who is not a co-owner or a stranger to the co-ownership. (Gochan
 In the same way, he cannot also be forced to sell his ideal share in v. Moncao)
the co-ownership by invoking Article 491 NCC. (Arambulo v.
Nolasco) Requisites
o Insofar as the sale of co-owned properties is concerned, there ARTICLE 1620, NCC. A co-owner of a thing may exercise the right
is no common interest that may be prejudiced should one or of redemption in case the shares of all the other co-owners or of any
more of the co-owners refuse to sell his or her ideal share. of them, are sold to a third person. If the price of the alienation is
grossly excessive, the redemptioner shall pay only a reasonable one.
(b) Effect of sale of entire property or sale of concrete portion
 As a mere part-owner, a co-owner cannot alienate the shares of Should two or more co-owners desire to exercise the right of
the other co-owners. redemption, they may only do so in proportion to the share they may
o “no one can give what he does not have”—nemo dat quod non respectively have in the thing owned in common.
habet. (Mercado v. CA)
 A co-owner has no right to sell or alienate a concrete, specific ARTICLE 1623, NCC. The right of legal pre-emption or redemption
or determinate part of the thing owned in common, because his shall not be exercised except within thirty days from the notice in
right over the thing is represented by a quota or ideal portion writing by the prospective vendor, or by the vendor, as the case
without any physical adjudication. (Heirs of Roger Jarque v. may be. The deed of sale shall not be recorded in the Registry of
Jarque) Property, unless accompanied by an affidavit of the vendor that he
 However, a sale of the entire property by one co-owner without has given written notice thereof to all possible redemptioners.
the consent of the other co-owners (Republic v. Heirs of
Francisca Dignos-Sorono, Bailon-Casilao v. CA) or a sale of a The right of redemption of co-owners excludes that of adjoining
concrete portion of the co-owned property without the consent of owners.
the others, (Lopez v. Vda. De Cuaycong) is not null and void for it
is well-established that the binding force of a contract must be Requisites
recognized as far as it is legally possible to do so. Quando res (1) there must be a co-ownership;
non valet ut ago, valeat quantum valere potest. (2) one of the co-owners sold his right to a stranger;
o But the sale will affect only his own share but not those of (3) sale was made before the partition of the co-owned property;
the other co-owners who did not consent to the sale. (4) the right of redemption must be exercised by one or more co-
 (Agusto v. Dy, Mactan-Cebu International Airport owners within a period of 30 days to be counted from the time
Authority v. Unchuan, Torres, Jr. v. Lapinid, Republic v. that he or they were notified in writing by the vendee or by the
Heirs of Dignos-Sorono, Aguirre v. CA, Corinthian co-owner vendor; and
Realty, Inc. v. CA, Del Ocampo v. CA, Tomas Claudio (5) the vendee must be reimbursed for the price of the sale.
Memorial College, Inc. v. CA, Paulmitan v. CA, Bailon-
Casilao v. CA) For this right to be exercised, co-ownership must exist at the time the
o What the vendee obtains by virtue of such a sale are the conveyance is made by a co-owner and the redemption is demanded by
same rights as the vendor had as co-owner, and the the other co-owner or co-owners.
vendee merely steps into the shoes of the vendor as co-owner
(Vda. De Figuracion v. Figuracion-Gerilla) and acquires a Requirement of written notice
proportionate abstract share in the property.  A co-owner desirous of exercising his right of legal redemption is
(Extraordinary Development Corp. v. Samson-Bico) given a period of 30 days from the notice in writing by the
 THUS: whether the disposition involves an abstract or concrete prospective vendor, or by the vendor, as the case may be. (1623)
portion of the co-owned property or the sale of the entire property,  The requirement of written notice is mandatory, (Pascual v.
the sale remains validly executed. (Torres, Jr. v. Lapinid) Ballesteros) but there is no required form.
o However, what will be affected on the sale is only his o So long as the latter is informed in writing of the sale and
proportionate share, subject to the results of the partition. the particulars, the 30 days for redemption start running, and
The co-owners who did not give their consent to the sale stand the redemptioner has no real cause to complain. (Bayan v.
to be unaffected by the alienation. Bayan)
 It can be in the form of
(c) Right of legal redemption o a copy of deed of sale, (Conejero v. CA)
When available o a copy of the summons (Francisco v. Boiser) or
ARTICLE 1620, NCC. A co-owner of a thing may exercise the o a copy of the Sheriff’s Certificate of Sale. (Bayan v. Bayan)
right of redemption in case the shares of all the other co-owners
or of any of them, are sold to a third person. If the price of the Notice must come from vendor
alienation is grossly excessive, the redemptioner shall pay only a The notice in writing must come from the vendor and notice given
reasonable one. by the vendee (buyer) should not be taken into account. (Butte v. Manuel
Uy & Sons, Inc., Francisco v. Boiser)
(d) No pre-emptive right  Prescription, as a mode of terminating a relation of coownership,

 What the law grants to a co-owner is a right of redemption and not must have been preceded by repudiation of the coownership.
pre-emption. (Adille v. CA)
 By the very nature of the right of “legal redemption,” a co-owner’s o absent a clear repudiation of the co-ownership, a co-owner
right to redeem is invoked only after the shares of the other cannot acquire by prescription the share of the other co-
co-owners are sold to a third party or stranger to the co- owners. (Heirs of Segunda Maningding v. CA)
ownership. (Reyes v. Concepcion)
Requisites of effective repudiation
4. Extinguishment of Co-ownership (1) the co-owner has performed unequivocal acts of repudiation
amounting to an ouster of the cestui que trust or the other co-
(a) Causes [MPDP] owners
(1) merger; (2) such positive acts of repudiation have been made known to
(2) prescription; the cestui que trust or the other co-owners;
(3) destruction of thing or loss of right; and (3) the evidence must be clear and convincing; (Heirs of
(4) partition. Yambao v. Heirs of Yambao) and
(4) he has been in possession through open, continuous,
 Redemption by a co-owner of the property in its totality during the exclusive, and notorious possession of the property for the
period of redemption does not vest in him ownership over it period required by law. (Vda. De Figuracion)
since redemption is not a mode of terminating a co-ownership.
(Adille v. CA, Mariano v. CA, Cruz v. Leis, Cabales v. CA, Tanghoy  Filing by a trustee of an action in court against the trustor to
v. Tigol) quiet title to property, or for recovery of ownership thereof, held in
o Such redemption will simply entitle him to collect possession by the former, may constitute an act of repudiation of
reimbursement from the remaining co-owners pursuant to the trust reposed on him by the latter. (Pangan)
Article 488 NCC, considering that redemption entails a  The issuance of the certificate of title solely in the name of the
necessary expense; (Adille, Cabales, Taghoy) and until co-owner possessor would constitute an open and clear
reimbursed, he holds a lien upon the property for the amount repudiation of the co-ownership, unless he allowed the other co-
due. owner to build her house on the property without any opposition.
 However, when the redemption is made after the period of o Such act constitutes an implied recognition of the co-
redemption, it is actually a repurchase. The co-owner who ownership, which in turn negates the presence of a clear
purchased the property will become exclusive owner. (Tan v. CA) notice of repudiation to the ousted co-owner. (Vda. De
Figuracion)
(b) Prescription  BUT the sole fact of a co-owner declaring the land in question
Rule in his name for taxation purposes and paying the land taxes did
ARTICLE 494, NCC. No co-owner shall be obliged to remain in the not constitute an unequivocal act of repudiation amounting to
co-ownership. Each co-owner may demand at any time the an ouster of the other co-owner and could not constitute adverse
partition of the thing owned in common, insofar as his share is possession as basis for title by prescription. (Heirs of Jose Reyes,
concerned. Jr. v. Reyes)
Nevertheless, an agreement to keep the thing undivided for a certain (c) Partition
period of time, not exceeding ten years, shall be valid. This term Concept
may be extended by a new agreement. ARTICLE 1079, NCC. Partition, in general, is the separation,
division and assignment of a thing held in common among those
A donor or testator may prohibit partition for a period which shall to whom it may belong. The thing itself may be divided, or its value.
not exceed twenty years.
ARTICLE 1082, NCC. Every act which is intended to put an end to
Neither shall there be any partition when it is prohibited by law. indivision among co-heirs and legatees or devisees is deemed to be
a partition, although it should purport to be a sale, an exchange, a
No prescription shall run in favor of a co-owner or co-heir compromise, or any other transaction.
against his co-owners or co-heirs so long as he expressly or
impliedly recognizes the co-ownership.  Partition is the separation, division, or assignment of a thing
held in common among those to whom it may belong.
 A co-owner cannot acquire by prescription the share of the  Every act which is intended to put an end to indivision among
other co-owners absent a clear repudiation of co-ownership duly co-heirs and legatees or devisees is deemed to be a partition,
communicated to the other co-owners. although it should purport to be a sale, an exchange, a
 The possession of a co-owner is like that of a trustee and shall compromise, or any other transaction.
not be regarded as adverse to the other co-owners but in fact
as beneficial to all of them. (Heirs of Feliciano Yambao v. Heirs of Rule
Hermogenes Yambao) ARTICLE 494, NCC. No co-owner shall be obliged to remain in the
co-ownership. Each co-owner may demand at any time the partition
When prescription lies of the thing owned in common, insofar as his share is concerned.
 If the co-owner actually holding the property asserts exclusive
dominion over it against the other co-owners, the corollary of the Nevertheless, an agreement to keep the thing undivided for a certain
rule is that he can acquire sole title to it after the lapse of the period of time, not exceeding ten years, shall be valid. This term may
prescribed prescriptive period. (Pangan v. CA) be extended by a new agreement.
A donor or testator may prohibit partition for a period which shall not ARTICLE 495, NCC. Notwithstanding the provisions of the preceding
exceed twenty years. article, the co-owners cannot demand a physical division of the thing
owned in common, when to do so would render it unserviceable for
Neither shall there be any partition when it is prohibited by law. the use for which it is intended. But the co-ownership may be
terminated in accordance with article 498.
No prescription shall run in favor of a co-owner or co-heir against his
co-owners or co-heirs so long as he expressly or impliedly recognizes (5) Whenever the thing is essentially indivisible and the co-
the co-ownership. owners cannot agree that it be allotted to one of them who
shall indemnify the others, it shall be sold and its proceeds
 A co-owner may demand at any time the partition of the thing distributed.
owned in common, insofar as his share is concerned. ARTICLE 498, NCC. Whenever the thing is essentially indivisible and
 As a consequence, an action to demand partition is the co-owners cannot agree that it be allotted to one of them who
imprescriptible or cannot be barred by laches. (Monteroso v. shall indemnify the others, it shall be sold and its proceeds
CA, Fangonil-Herrera v. Fangonil, Salvador v. CA) distributed.
 If there is a conflict between dismissal with prejudice under
Rule 17, SEC. 3 ROC and the right of co-owners to demand This is resorted to when:
partition at any time under Article 494 NCC, the latter must prevail. (1) the right to partition the property is invoked by any of the co-
o To construe otherwise would diminish the substantive right of owners, but
a co-owner through the promulgation of procedural rules. (a) because of the nature of the property it cannot be
(Quintos v. Nicolas) subdivided, or
(b) its subdivision would prejudice the interests of the co-
When action no longer for partition owners, and
 As long as the co-ownership is recognized, an action to compel (2) the co-owners are not in agreement as to who among them
partition will not prescribe and may be filed at any time against shall be allotted or assigned the entire property upon proper
the actual possessor by any of the other co-owners. (Pangan) reimbursement of the co-owners.
 From the moment one of the co-owners claims that he is the (Aguilar v. CA)
absolute and exclusive owner of the properties and denies the
others any share, the question involved is no longer one of partition, FF. Ownership of Waters
but of ownership. (Delima v. CA)
o The imprescriptibility of the action for partition can no longer 1. Property of Public Dominion
be invoked or applied when one of the co-owners has
adversely possessed the property as exclusive owner for a (a) Ownership
period sufficient to vest ownership by prescription. All waters in their natural beds are considered property of public
dominion, whether or not the waters are found on private lands, including
Prescriptive period subterranean or ground waters.
ARTICLE 1137, NCC. Ownership and other real rights over
immovables also prescribe through uninterrupted adverse ARTICLE XII, Section 2, CONST. X
possession thereof for thirty years, without need of title or of good
faith. ARTICLE 5, WC. The following belong to the State:
(a) Rivers and their natural beds;
(1) If by acquisitive prescription, a co-owner acquires ownership of (b) Continuous or intermittent waters of springs and brooks running
real property after 30 years; or in their natural beds and the beds themselves;
(2) if by extinctive prescription (statute of limitations), it has been (c) Natural lakes and lagoons;
held that the action for reconveyance by a co-owner of his share (d) All other categories of surface waters such as water flowing over
prescribes in 10 years, the action being based on an implied or lands, water from rainfall whether natural, or artificial, and water
constructive trust, counted from the date of the issuance of the title from agriculture runoff, seepage and drainage;
in the name of the co-owner possessor? (Jaramil v. CA) (e) Atmospheric water;
(f) Subterranean or ground waters; and,
When partition not allowed (g) Seawater.
(1) By agreement
o An agreement among the owners to keep the thing undivided ARTICLE 6, WC. The following waters found on private lands
is valid. (494[2]) belong to the State:
 However, such agreement must not exceed 10 years; (a) Continuous or intermittent waters rising on such lands;
 otherwise, the agreement shall be void but only as to (b) Lakes and lagoons naturally occurring on such lands;
the period beyond such maximum. (Oliveras v. Lopez) (c) Rain water falling on such lands;
 However, the period of 10 years may be extended by a (d) Subterranean or ground waters; and,
new agreement. (494[2]) (e) Water in swamps and marshes.
(2) By will of grantor The owner of the land where the water is found may use the
o A donor or testator may prohibit partition for a period not same for domestic purposes without securing a permit, provided
exceeding 20 years. (494[3]) that such use shall be registered, when required by the Council. The
(3) By law Council, however, may regulate such use when there is wastage, or
o such as the partition of a family home unless there is a in times of emergency.
compelling reason to do so. (159 FC; Patricio v. Dario III)
(4) When partition would render the thing unserviceable for the (b) Appropriation of Waters
use for which it is intended.
 The privilege to appropriate and use water is one which is ARTICLE 530, NCC. Only things and rights which are susceptible
exclusively granted and regulated by the State through water of being appropriated may be the object of possession.
permits issued by the National Water Resources Board (NWRB).
 Once granted, these water permits continue to be valid save only Definition: Possession is the holding of a thing or the enjoyment of a
for reasons spelled out under the Water Code itself. (City of right.
Batangas v. Philippine Shell Petroleum Corp.)
o Conversely, the power to modify, suspend, cancel, or revoke Jus possidendi – consequence of ownership
water permits already issued also rests with NWRB. Jus possessionis – independent of ownership
(c) Water permit Object: Only things and rights which are susceptible of being
ARTICLE 13, WC. Except as otherwise herein provided, no person, appropriated may be the object of possession.
including government instrumentalities or government-owned or
controlled corporations, shall appropriate water without a water Requisites
right, which shall be evidenced by a document known as a water In order that there be possession:
permit. (1) there must be occupancy, apprehension, or taking; and
(2) there must be intent to possess (animus possidendi).
Water right is the privilege granted by the government to appropriate (Yu v. Pacleb; So v. Food Fefst Land, Inc.)
and use water.
(b) Possession in one’s own name or in that of another
ARTICLE 6, WC. The following waters found on private lands belong ARTICLE 524, NCC. Possession may be exercised in one's own
to the State: name or in that of another.
(a) Continuous or intermittent waters rising on such lands;
(b) Lakes and lagoons naturally occurring on such lands;  It is not necessary that the owner or holder of the thing
(c) Rain water falling on such lands; exercises personally the rights of possession.
(d) Subterranean or ground waters; and, o Rights of possession may be exercised through agents.
(e) Water in swamps and marshes. (Santos v. Manalili)
The owner of the land where the water is found may use the same  Hence, possession may be exercised in one’s own name or in that
for domestic purposes without securing a permit, provided that such of another.
use shall be registered, when required by the Council. The Council,  Possession in another’s name is possession by a person
however, may regulate such use when there is wastage, or in times without any right of his own and one which is strictly of an agent;
of emergency. o while possession in one’s own name embraces all kinds
of possession anchored on a juridical title or right, e.g.,
ARTICLE 14, WC. Subject to the provisions of this Code concerning possession by the owner himself, possession by a lessee, or
the control, protection, conservation, and regulation of the a mere usufructuary.
appropriation and use of waters, any person may appropriate or use
natural bodies of water without securing a water permit for any of the (c) Possession in concept of owner or in concept of holder
following:
(a) Appropriation of water by means of hand-carried receptacles; Concept
and  A possessor in the concept of holder acknowledges in another
(b) Bathing or washing, watering or dipping of domestic or farm a superior right which he believes to be ownership, whether his
animals, and navigation of watercrafts or transportation of logs belief be right or wrong.
and other objects by flotation.  A possessor in the concept of an owner may be the owner himself
or one who claims to be so, provided he does not acknowledge in
GR: Appropriation of water is not authorized without a "water another a superior right.
permit," which is a privilege granted by the government to appropriate (Carlos v. Republic)
and use water and evidenced by a document known as “water permit.”
Effects of possessor in concept of owner:
EXC: A water permit need not be secured in the following instances: ARTICLE 433, NCC. Actual possession under claim of ownership
(1) for use of waters found on private lands by the owner thereof raises a disputable presumption of ownership. The true owner must
but only for domestic purposes; and resort to judicial process for the recovery of the property.
(2) use of natural bodies of water for any of the following:
(a) appropriation of water by means of hand-carried ARTICLE 541, NCC. A possessor in the concept of owner has in his
receptacles; and favor the legal presumption that he possesses with a just title and he
(b) bathing or washing, watering, or dipping of domestic or farm cannot be obliged to show or prove it.
animals, and navigation of watercrafts or transportation of logs
and other objects by floatation. ARTICLE 540, NCC. Only the possession acquired and enjoyed in
the concept of owner can serve as a title for acquiring dominion.
GG. Possession
ARTICLE 1118, NCC. Possession has to be in the concept of an
1. Concept and Kinds
owner, public, peaceful and uninterrupted.
(a) Definition and requisites

(1) it raises a disputable presumption of ownership;
ARTICLE 523, NCC. Possession is the holding of a thing or the
(2) it creates a disputable presumption that the possessor has just title,
enjoyment of a right.
which he cannot be obliged to show; and
(3) it may ripen into ownership thru acquisitive prescription upon not prefer to retain them by paying the value they may have at the
compliance with the other requisites in Article 1118 NCC. time he enters into possession.
(a) If only in the concept of holder – no prescription
(i) EXC: if the superior right is repudiated ARTICLE 443, NCC. Each one of the participants of a thing
possessed in common shall be deemed to have exclusively
(d) Possession in good faith or in bad faith: possessed the part which may be allotted to him upon the division
thereof, for the entire period during which the co-possession lasted.
Concept Interruption in the possession of the whole or a part of a thing
ARTICLE 526, NCC. He is deemed a possessor in good faith who possessed in common shall be to the prejudice of all the possessors.
is not aware that there exists in his title or mode of acquisition any However, in case of civil interruption, the Rules of Court shall apply.
flaw which invalidates it.
 A possessor in good faith is entitled to the fruits received by
He is deemed a possessor in bad faith who possesses in any case him before his possession is legally interrupted.
contrary to the foregoing.  A possessor in bad faith has the obligation to reimburse the
legitimate possessor for everything that he may have received and
 Possessor is considered in good faith if he is not aware that there those which the legitimate possessor could have received.
exists in his title or mode of acquisition any flaw which invalidates  But whether the possessor is in good faith or in bad faith, he is
it. (PNB v. De Jesus, Heirs of Marcelino Cabal v. Cabal, Ochoa v. entitled to recover from the legitimate possessor the expenses
Apeta) he incurred in the production, gathering, and preservation of
 A possessor in bad faith is one in possession of property knowing the fruits upon return of the same.
that his title thereto is defective. (Escritor, Jr. v. IAC)
o Thus, a possessor by mere tolerance is not a possessor Effects upon fruits still pending
in good faith. (Resuena v. CA) ARTICLE 545, NCC. If at the time the good faith ceases, there
o One whose interest is merely that of a holder, such as a should be any natural or industrial fruits, the possessor shall have a
mere tenant, agent, or usufructuary, is not qualified to become right to a part of the expenses of cultivation, and to a part of the net
a possessor in good faith. (Parilla v. Pilar, Macasaet v. harvest, both in proportion to the time of the possession.
Macasaet)
The charges shall be divided on the same basis by the two
Presumption of good faith possessors.
ARTICLE 527, NCC. Good faith is always presumed, and upon him
who alleges bad faith on the part of a possessor rests the burden of The owner of the thing may, should he so desire, give the possessor
proof. in good faith the right to finish the cultivation and gathering of the
growing fruits, as an indemnity for his part of the expenses of
ARTICLE 528, NCC. Possession acquired in good faith does not cultivation and the net proceeds; the possessor in good faith who for
lose this character except in the case and from the moment facts any reason whatever should refuse to accept this concession, shall
exist which show that the possessor is not unaware that he lose the right to be indemnified in any other manner.
possesses the thing improperly or wrongfully.
ARTICLE 549, NCC, supra. The possessor in bad faith shall
 Good faith is always presumed and reimburse the fruits received and those which the legitimate
 continues to subsist until facts exist which show that the possessor could have received, and shall have a right only to the
possessor is already aware that he wrongfully or improperly expenses mentioned in paragraph 1 of article 546 and in article 443.
possesses the thing. The expenses incurred in improvements for pure luxury or mere
 Whatever may be the cause or the fact from which it can be pleasure shall not be refunded to the possessor in bad faith; but he
deduced that the possessor has knowledge of the defects of his may remove the objects for which such expenses have been
title or mode of acquisition, it must be considered sufficient to show incurred, provided that the thing suffers no injury thereby, and that
bad faith. (Wong v. Carpio) the lawful possessor does not prefer to retain them by paying the
value they may have at the time he enters into possession.
Effects upon fruits already received by possessor
ARTICLE 544, NCC. A possessor in good faith is entitled to the fruits ARTICLE 452, NCC. The builder, planter or sower in bad faith is
received before the possession is legally interrupted. entitled to reimbursement for the necessary expenses of
preservation of the land.
Natural and industrial fruits are considered received from the time
they are gathered or severed.  If the possessor was in good faith,
o the possessor and the owner shall have a right to a part
Civil fruits are deemed to accrue daily and belong to the possessor of the net harvest and each shall divide the expenses of
in good faith in that proportion. cultivation, both in proportion to the time of their respective
possessions.
ARTICLE 549, NCC. The possessor in bad faith shall reimburse the o If the owner does not want to pay his share of the
fruits received and those which the legitimate possessor could have expenses, he may, at his option, allow the possessor to
received, and shall have a right only to the expenses mentioned in finish the cultivation and gathering of the growing fruits (in
paragraph 1 of article 546 and in article 443. The expenses incurred lieu of his part of such expenses), in which case, the owner
in improvements for pure luxury or mere pleasure shall not be will not have any share in the harvest.
refunded to the possessor in bad faith; but he may remove the  If the owner chooses this option and the possessor
objects for which such expenses have been incurred, provided that refuses to accept the concession "for any reason
the thing suffers no injury thereby, and that the lawful possessor does
whatever," the latter shall lose the right to be indemnified

in any other manner.  A possessor in bad faith has no right in relation to the useful
 If he was a possessor in bad faith, he will lose the fruits in favor expenses that he incurred. He is not entitled to its refund and he
of the legitimate possessor, without the right to be indemnified. has no right to remove the useful improvements. (MWSS v. CA)
However, he is still entitled to recover the necessary expenses he
incurred or the preservation of the land. Effects upon expenses for pure luxury
ARTICLE 548, NCC. Expenses for pure luxury or mere pleasure shall
Effects upon necessary expenses not be refunded to the possessor in good faith; but he may remove
 Necessary expenses are those incurred not for improvement the ornaments with which he has embellished the principal thing if it
but for the preservation of the thing and are intended not to suffers no injury thereby, and if his successor in the possession does
increase the value thereof but to prevent it from becoming useless. not prefer to refund the amount expended.
(Rivera v. Roman Catholic Archbishop of Manila)
 Whether in good faith or in bad faith, a possessor is entitled to ARTICLE 549, NCC. The possessor in bad faith shall reimburse the
the refund of necessary expenses incurred by him. fruits received and those which the legitimate possessor could have
o BUT only a possessor in good faith is entitled to retain received, and shall have a right only to the expenses mentioned in
the thing until he has been reimbursed therefor. paragraph 1 of article 546 and in article 443. The expenses incurred
in improvements for pure luxury or mere pleasure shall not be
ARTICLE 546 (1), NCC. Necessary expenses shall be refunded to refunded to the possessor in bad faith; but he may remove the
every possessor; but only the possessor in good faith may retain the objects for which such expenses have been incurred, provided that
thing until he has been reimbursed therefor. the thing suffers no injury thereby, and that the lawful possessor does
not prefer to retain them by paying the value they may have at the
Useful expenses shall be refunded only to the possessor in good faith time he enters into possession.
with the same right of retention, the person who has defeated him in
the possession having the option of refunding the amount of the  Whether in good faith or in bad faith, a possessor is not entitled
expenses or of paying the increase in value which the thing may have to a refund of the expenses incurred by him for pure luxury or
acquired by reason thereof. mere pleasure, called “ornamental expenses.”
 Both kinds of possessors are entitled to a right of removal of the
Effects upon useful expenses ornaments with which they embellished the principal thing,
ARTICLE 547, NCC. If the useful improvements can be removed provided that such principal will suffer no injury.
without damage to the principal thing, the possessor in good faith  If the owner, however, exercises his option to retain possession
may remove them, unless the person who recovers the possession of the ornaments by reimbursing the value thereof to the
exercises the option under paragraph 2 of the preceding article. possessor, the latter’s right of removal may not be exercised.
o If the possessor is in good faith, the extent of the refund
ARTICLE 546 (2), NCC. Useful expenses shall be refunded only to shall be the actual amount expended.
the possessor in good faith with the same right of retention, the o If the possessor is in bad faith, the extent of the refund shall
person who has defeated him in the possession having the option of be limited to the value of the ornament at the time the
refunding the amount of the expenses or of paying the increase in owner enters into the possession of the property,
value which the thing may have acquired by reason thereof. irrespective of the amount actually spent by the possessor in
bad faith.
 Useful expenses are those incurred to give greater utility or
productivity to the property. (Tolentino) 2. Acquisition and Loss of Possession
 These expenses increase the value of the thing and results in
improvements, called useful improvements. (a) Modes of acquisition:
 Only the possessor in good faith is entitled to the refund of
useful expenses. (1) By material occupation – applicable only to corporeal objects,
including
In making the refund, the owner (or the person who has defeated the (a) tradicion brevi manu and
possessor in good faith in the possession) has the option: (b) tradicion constitutum possessorium;
(1) to refund the amount of the expenses; or (2) By exercise of right
(2) to pay the increase in value which the thing may have acquired by (a) applicable to acquisition of possession over rights;
reason of the useful expenses. (3) By subjecting the thing or right to the action of our will – not
involving material apprehension but connotes a degree of control
ARTICLE 547, NCC. If the useful improvements can be removed sufficient to subject the thing to the action of one’s will, including:
without damage to the principal thing, the possessor in good faith (a) tradicion simbolica and
may remove them, unless the person who recovers the possession (b) tradicion longa manu
exercises the option under paragraph 2 of the preceding article. (4) By proper acts and legal formalities – any juridical act by which
possession is acquired or to which the law gives the force of acts
The possessor in good faith may, in lieu of reimbursement for the of possession, such as donations, succession, execution, and
useful expenses, remove the useful improvements but subject to registration of public instruments, inscription of possessory
compliance with the following requisites: information titles, and the like.
(1) The removal can be done without damage to the principal thing;
and (Mangaser v. Ugay; Bunyi v. Factor, Quizon v. Juan, Habagat Grill v.
(2) The owner does not choose to appropriate the improvements by DMC-Urban Property Developer, Inc.)
refunding to the possessor in good faith the useful expenses in the
manner discussed above. (b) Doctrine of constructive possession
Concept: The possession and cultivation of a portion of a tract under (b) the animus revertendi (intent to recover) must be finally given
claim of ownership of all is a constructive possession of all, if the up; (US v. Rey)
remainder is not in the adverse possession of another. (Ramos v. (2) by assignment
Director of Lands) (3) by destruction or loss of the thing; and
(4) by possession of another - if the possession of another lasts for
Requisites for application: more than one year, only possession de facto is lost but not the
(1) the alleged possessor must be in actual possession of a portion real right of possession (possession de jure), which is not lost
or part of the property; until after the lapse of 10 years.
(2) he is claiming ownership of the whole area;
(3) the remainder of the area must not be in the adverse possession 3. Possession of Movables
of another person; and
(4) the area claimed must be reasonable, (a) Doctrine of irrevindicability of movables
ARTICLE 559 (1), NCC. The possession of movable property
(c) When possession not acquired: acquired in good faith is equivalent to a title. Nevertheless, one who
ARTICLE 536, NCC. In no case may possession be acquired through has lost any movable or has been unlawfully deprived thereof, may
force or intimidation as long as there is a possessor who objects recover it from the person in possession of the same.
thereto. He who believes that he has an action or a right to deprive xxx
another of the holding of a thing, must invoke the aid of the competent
court, if the holder should refuse to deliver the thing. Possession of movables acquired in good faith does not only create a
presumption of ownership but it is already equivalent to title.
ARTICLE 537, NCC. Acts merely tolerated, and those executed
clandestinely and without the knowledge of the possessor of a thing, For possession of movables to be considered equivalent to title, the
or by violence, do not affect possession. following requisites must be present:
(1) the movable property must be acquired in good faith; and
(1) If acquired through force or intimidation, as long as there is a (2) the possession must be in the concept of owner.
possessor who objects thereto; (a) Possession of the movable cannot anymore be recovered
(2) acts which are merely tolerated; and from the present possessor.
(3) acts which are executed clandestinely and without the knowledge
of the possessor of a thing. (b) Exceptions to irrevindicability
ARTICLE 559 (2), NCC. If the possessor of a movable lost or which
(d) Conflict in possession de facto the owner has been unlawfully deprived, has acquired it in good faith
ARTICLE 538, NCC. Possession as a fact cannot be recognized at at a public sale, the owner cannot obtain its return without
the same time in two different personalities except in the cases of reimbursing the price paid therefor.
co-possession. Should a question arise regarding the fact of
possession, the present possessor shall be preferred; if there are two (1) When the owner has lost the thing, or
possessors, the one longer in possession; if the dates of the (2) when he has been unlawfully deprived thereof.
possession are the same, the one who presents a title; and if all these
conditions are equal, the thing shall be placed in judicial deposit  If the owner has lost a movable, or if he has been unlawfully
pending determination of its possession or ownership through proper deprived thereof, he has a right to recover it,
proceedings. o not only from the finder, thief, or robber,
o Also from third persons who may have acquired it in good faith
(1) Present possessor shall be preferred; from such finder, thief, or robber, (Aznar v. Yapdiangco)
(2) if there are two possessors, the one longer in possession is without need of reimbursing the price paid therefor.
preferred;  However, if the third person acquired it in good faith at a public
(3) if the dates of possession are the same, the one who presents a sale, the owner cannot obtain its return without reimbursing
title; and the price paid therefor.
(4) if all the foregoing conditions are equal, the thing shall be placed in  “Unlawful deprivation” in Article 559 is not limited to cases of theft
judicial deposit pending determination of its possession or or robbery (or unlawful taking) but includes cases where there has
ownership through proper proceedings. been abuse of confidence. (Cruz v. Pahati, Aznar v. Yapdiangco)
 But “unlawful deprivation” may not be unduly stretched to cover
(e) Modes of losing possession situations where there is a contract of purchase and sale
ARTICLE 555, NCC. A possessor may lose his possession: between two persons and the buyer therein fails to pay the
(1) By the abandonment of the thing; purchase price but nonetheless alienates the thing sold in favor of
(2) By an assignment made to another either by onerous or the present possessor who acted in good faith. (EDCA Publishing
gratuitous title; v. Santos, Asiatic Commercial Corp. v. Ang, Tagatac v. Jimenez)
(3) By the destruction or total loss of the thing, or because it goes o EDCA: INTENTION TO DELIVER for the purpose of
out of commerce; transferring ownership
(4) By the possession of another, subject to the provisions of article o Aznar: there was no such intention
537, if the new possession has lasted longer than one year. But
the real right of possession is not lost till after the lapse of ten (c) Possession over animals
years. ARTICLE 560, NCC. Wild animals are possessed only while they are
under one’s control; domesticated or tamed animals are considered
(1) By abandonment, which requires two requisites: domestic or tame, if they retain the habit of returning to the premises
(a) the spes recuperandi (hope of recovery or recapture) must be of the possessor.
gone; and
Kinds of animals
(1) wild animals — those which are found in their natural freedom, (1) By the death of the usufructuary, unless a contrary intention
such as wild boars and horses roaming the forest; clearly appears;
(2) domesticated or tamed animals - those which were formerly wild (2) By the expiration of the period for which it was constituted, or by
but which have been subdued and retained the habit of returning the fulfillment of any resolutory condition provided in the title
to the premises of the possessor or owner; and creating the usufruct;
(3) domestic animals - those which are born or reared under the control (3) By merger of the usufruct and ownership in the same person;
and care of man. (4) By renunciation of the usufructuary;
(5) By the total loss of the thing in usufruct;
When possession over animals is lost: (6) By the termination of the right of the person constituting the
(1) As to wild animals usufruct;
 they are considered possessed only while they are under one’s (7) By prescription.
control and once they recover their natural freedom they cease to
be under one’s possession, ARTICLE 573, NCC. Whenever the usufruct includes things which,
(2) As to domesticated or tamed animals without being consumed, gradually deteriorate through wear and
 they will be regarded as such so long as they retain the habit of tear, the usufructuary shall have the right to make use thereof in
returning to the premises of the possessor and possession thereof accordance with the purpose for which they are intended, and shall
is not immediately lost by the simple fact that the animals are no not be obliged to return them at the termination of the usufruct except
longer under the control of the possessor. in their condition at that time; but he shall be obliged to indemnify the
 Under the law, the possessor or owner of domesticated animals owner for any deterioration they may have suffered by reason of his
has a period of 20 days counted from the occupation by another fraud or negligence.
person within which to reclaim them.
 After the expiration of this period, the animals can no longer be (1) it entitles the holder of the usufruct (“usufructuary”) to exercise the
recovered from its present possessor, rights to enjoy the property (jus utendi) and to receive the fruits
(3) As to domestic animals thereof (jus fruendi)
 they are considered personal property and the rules on personal (2) it is a right enjoyed over another’s property, a jus in re aliena,
property will apply. (3) it is a real right, which may be exercised over a real or personal
property;
HH. Usufruct (4) it is of a temporary character since, the right is extinguished
upon the expiration of the period for which it was constituted or
1. Basic Principles upon the death of the usufructuary;
(5) it ordinarily obliges the usufructuary to preserve the form and
(a) Definition substance of the thing subject to usufruct, except in the following
 It is the right to enjoy the property of another temporarily, instances where there is no such obligation:
 including both the jus utendi and the jus fruendi, with the owner (a) when the law or the title creating the usufruct provides that
retaining the jus disponendi or the power to alienate the same. the usufructuary is not so obliged;
(Moralidad v. Pernes) (b) when the usufruct includes things which, without being
consumed, gradually deteriorate through wear and tear;
(b) Object of usufruct and
ARTICLE 564, NCC. Usufruct may be constituted on the whole or a (c) when the usufruct includes things which cannot be used
part of the fruits of the thing, in favor of one or more persons, without being consumed.
simultaneously or successively, and in every case from or to a certain
day, purely or conditionally. It may also be constituted on a right, (d) Classifications of usufruct:
provided it is not strictly personal or intransmissible. ARTICLE 563, NCC. Usufruct is constituted by law, by the will of
private persons expressed in acts inter vivos or in a last will and
 It maybe constituted over a corporeal object or rights. testament, and by prescription.
 With respect to rights, it may be the object of usufruct provided:
(a) it is not strictly personal; ARTICLE 226 FC. The property of the unemancipated child earned
(b) it is not intransmissible; and or acquired with his work or industry or by onerous or gratuitous title
(c) it has its own independent existence. (Tolentino) shall belong to the child in ownership and shall be devoted
(i) Hence, a servitude cannot be the object of usufruct exclusively to the latter’s support and education, unless the title or
because it has no existence independent of the transfer provides otherwise.
tenements.
The right of the parents over the fruits and income of the child’s
(c) Characteristics property shall be limited primarily to the child’s support and
ARTICLE 562, NCC. Usufruct gives a right to enjoy the property of secondarily to the collective daily needs of the family.
another with the obligation of preserving its form and substance,
unless the title constituting it or the law otherwise provides. ARTICLE 574, NCC. Whenever the usufruct includes things which
cannot be used without being consumed, the usufructuary shall have
ARTICLE 566, NCC. The usufructuary shall be entitled to all the the right to make use of them under the obligation of paying their
natural, industrial and civil fruits of the property in usufruct. With appraised value at the termination of the usufruct, if they were
respect to hidden treasure which may be found on the land or appraised when delivered. In case they were not appraised, he shall
tenement, he shall be considered a stranger. have the right to return the same quantity and quality, or pay their
current price at the time the usufruct ceases.
ARTICLE 603, NCC. Usufruct is extinguished:
ARTICLE 689, NCC. The owner of a tenement or piece of land, the accordance with the custom of the place, as to the manner, amount
usufruct of which belongs to another, may impose thereon, without and season.
the consent of the usufructuary, any servitudes which will not injure
the right of usufruct. In any case the felling or cutting of trees shall be made in such
manner as not to prejudice the preservation of the land.
ARTICLE 595, NCC. The owner may construct any works and make
any improvements of which the immovable in usufruct is susceptible, In nurseries, the usufructuary may make the necessary thinnings in
or make new plantings thereon if it be rural, provided that such acts order that the remaining trees may properly grow.
do not cause a diminution in the value of the usufruct or prejudice the
right of the usufructuary. With the exception of the provisions of the preceding paragraphs, the
usufructuary cannot cut down trees unless it be to restore or improve
(1) As to manner of creation: (LVM) some of the things in usufruct, and in such case he shall first inform
(a) legal usufruct - that which is constituted by law, "such as the owner of the necessity for the work.
those existing in favor of parents over the property of their
minor children living in their custody and under their parental ARTICLE 575, NCC. The usufructuary of fruit-bearing trees and
authority; shrubs may make use of the dead trunks, and even of those cut off
(b) voluntary - that which is constituted by the will of private or uprooted by accident, under the obligation to replace them with
persons expressed in acts inter vivos, such as contracts and new plants.
donations, or expressed in a last will and testament; and
(c) mixed - that which is constituted by prescription. ARTICLE 578, NCC. The usufructuary of an action to recover real
(2) As to subject matter: property or a real right, or any movable property, has the right to bring
(a) proper or normal – when it is constituted over a non- the action and to oblige the owner thereof to give him the authority
consumable thing; or for this purpose and to furnish him whatever proof he may have. If in
(b) improper or abnormal – when it is constituted over a consequence of the enforcement of the action he acquires the thing
consumable thing, or over a non-consumable which gradually claimed, the usufruct shall be limited to the fruits, the dominion
deteriorates. remaining with the owner.
2. Rights of Usufructuary ARTICLE 566, NCC. The usufructuary shall be entitled to all the
natural, industrial and civil fruits of the property in usufruct. With
(a) Rights included respect to hidden treasure which may be found on the land or
ARTICLE 572, NCC. The usufructuary may personally enjoy the tenement, he shall be considered a stranger.
thing in usufruct, lease it to another, or alienate his right of usufruct,
even by a gratuitous title; but all the contracts he may enter into as ARTICLE 567, NCC. Natural or industrial fruits growing at the time
such usufructuary shall terminate upon the expiration of the usufruct, the usufruct begins, belong to the usufructuary.
saving leases of rural lands, which shall be considered as subsisting
during the agricultural year. Those growing at the time the usufruct terminates, belong to the
owner.
 Usufruct includes the right to enjoy the property of another
temporarily, including both the jus utendi and the jus fruendi. In the preceding cases, the usufructuary, at the beginning of the
(Moralidad v. Sps. Pernes) usufruct, has no obligation to refund to the owner any expenses
o Hence, he may lease the object held in usufruct which the incurred; but the owner shall be obliged to reimburse at the
owner must respect so long as the usufruct exists. termination of the usufruct, from the proceeds of the growing fruits,
 BUT the owner of the property retains the jus disponendi or the ordinary expenses of cultivation, for seed, and other similar
the power to alienate, encumber, transform, and even destroy the expenses incurred by the usufructuary.
same. (Hermedes v. CA)
o Hence, the owner may The provisions of this article shall not prejudice the rights of third
 validly mortgage the property in favor of a third persons, acquired either at the beginning or at the termination of the
person; usufruct.
 impose, without the consent of the usufructuary, a
voluntary easement upon the tenement or piece of land  Usufruct is over a woodland: usufructuary may cut trees on the
held in usufruct; and land as the owner was in the habit of doing or in accordance with
 construct any works and make any improvements of the custom of the place, as to the manner, amount, and season.
which the immovable in usufruct is susceptible, or make  Usufruct over fruit-bearing trees and shrubs:
new plantings thereof if it be rural. o usufructuary has the full and unfettered right to gather the
o He may not, however, exercise such right in a manner that fruits from the tree but
will have an adverse effect upon the usufructuary, o he does not have the right to cut trees.
o However, he may make use of the dead trunks, as well as
(b) Extent of usufructuary rights those uprooted by accident, but with the corresponding
ARTICLE 577 (2), NCC. The usufructuary of woodland may enjoy all obligation to replace them with new plants.
the benefits which it may produce according to its nature.  Usufruct is over an action to recover property, real or personal:
o usufructuary has the right to bring the action, and
If the woodland is a copse or consists of timber for building, the o to oblige the owner to give him the authority for such
usufructuary may do such ordinary cutting or felling as the owner was purpose and to furnish him whatever proof the owner may
in the habit of doing, and in default of this, he may do so in have.
 As to the fruits, the usufructuary is entitled to all the natural, FC, since the same is to be devoted primarily to the child’s support
industrial, and civil fruits of the property in usufruct. and secondarily to the collective needs of the family;
o Natural or industrial fruits which are still pending or (2) the usufruct granted to a usufructuary in consideration of his
ungathered at the time that the usufruct begins belong to person to last during his lifetime, since the usufruct is a matter
the usufructuary, and he has no obligation to refund to the of personal quality; and
owner of any expenses incurred by the latter in connection (3) when the enjoyment of the property held in usufruct is acquired
with the cultivation and production of such fruits. through caucion juratoria, inasmuch as the basis is the need of
o With respect to natural or industrial fruits which are still the usufructuary.
pending or ungathered at the time the usufruct (a) usufructuary, being unable to file the required bond or
terminates, the same shall belong to the owner of the security, makes a “promise under oath” to take good care of
property but the latter shall be obliged to reimburse the the property necessary for himself and his family and to return
usufructuary the ordinary expenses of cultivation, for seeds the same at the end of the usufruct.
and other similar expenses incurred by the usufructuary.
3. Obligations of Usufructuary
(c) Right to improvements introduced
ARTICLE 579, NCC. The usufructuary may make on the property (A) At Commencement of Usufruct
held in usufruct such useful improvements or expenses for mere
pleasure as he may deem proper, provided he does not alter its form (a) Obligations
or substance; but he shall have no right to be indemnified therefor. ARTICLE 583, NCC. The usufructuary, before entering upon the
He may, however, remove such improvements, should it be possible enjoyment of the property, is obliged:
to do so without damage to the property. (1) To make, after notice to the owner or his legitimate
representative, an inventory of all the property, which shall
ARTICLE 580, NCC. The usufructuary may set off the improvements contain an appraisal of the movables and a description of the
he may have made on the property against any damage to the same. condition of the immovables;
(2) To give security, binding himself to fulfill the obligations imposed
He has no right to reimbursement. Otherwise, then the usufructuary upon him in accordance with this Chapter.
might improve the owner out of his property. (Moralidad v. Pernes) He
may, however, at his option: ARTICLE 586, NCC. Should the usufructuary fail to give security in
(1) remove the improvements if such removal is possible without the cases in which he is bound to give it, the owner may demand that
damage to the property; or the immovables be placed under administration, that the movables
(2) he may set-off the improvements against any damage he has be sold, that the public bonds, instruments of credit payable to order
caused to the property held in usufruct. or to bearer be converted into registered certificates or deposited in
(a) The right of the usufructuary to remove the improvements is a bank or public institution, and that the capital or sums in cash and
potestative with him. the proceeds of the sale of the movable property be invested in safe
(b) He cannot be prevented from choosing it or he may not securities.
be compelled to do it.
The interest on the proceeds of the sale of the movables and that on
(d) Right to alienate usufructuary right public securities and bonds, and the proceeds of the property placed
ARTICLE 572, NCC. The usufructuary may personally enjoy the under administration, shall belong to the usufructuary.
thing in usufruct, lease it to another, or alienate his right of usufruct,
even by a gratuitous title; but all the contracts he may enter into as Furthermore, the owner may, if he so prefers, until the usufructuary
such usufructuary shall terminate upon the expiration of the usufruct, gives security or is excused from so doing, retain in his possession
saving leases of rural lands, which shall be considered as subsisting the property in usufruct as administrator, subject to the obligation to
during the agricultural year. deliver to the usufructuary the net proceeds thereof, after deducting
the sums which may be agreed upon or judicially allowed him for
ARTICLE 590, NCC. A usufructuary who alienates or leases his right such administration.
of usufruct shall answer for any damage which the things in usufruct
may suffer through the fault or negligence of the person who ARTICLE 588, NCC. After the security has been given by the
substitutes him. usufructuary, he shall have a right to all the proceeds and benefits
from the day on which, in accordance with the title constituting the
RULE usufruct, he should have commenced to receive them.
 A usufructuary may alienate or encumber his right of usufruct
without the consent of the owner of the property whether by (1) to make an inventory of all the property covered by the right of
onerous or gratuitous title. usufruct; and
 All such contracts, however, shall terminate upon the (2) to give security or bond.
expiration of the usufruct.
o The transfer or alienation of the right of usufruct does not (b) Effect of failure to comply
result in the termination of the relation between the  It will only prevent usufructuary from exercising his right of
usufructuary and the naked owner. usufruct but it will not result in the termination of the usufruct.
o Hence, the former shall be personally liable to the latter  The owner may, if he so desires, retain in his possession the
for any damage to the thing in usufruct caused by the fault or property in usufruct as its administrator.
negligence of the transferee or lessee.
If the owner prefers not to retain possession of the property, he may
Usufructuary right which may not be alienated: demand instead:
(1) the legal usufruct of the parents over the fruits and income of (1) that the immovables be placed under administration;
the property of unemancipated children pursuant to Article 226
(2) that the movables he sold and its proceeds be invested in safe a house included in the usufruct, the court may grant this petition,
securities; after due consideration of the facts of the case.
(3) that the public bonds, instruments of credit payable to order or
bearer be converted into registered certificates or deposited in The same rule shall be observed with respect to implements, tools
a bank or public institution; or and other movable property necessary for an industry or vocation in
(4) that the capital or sums in cash be invested in safe securities. which he is engaged.
(c) Effect of compliance If the owner does not wish that certain articles be sold because of
After compliance with the foregoing obligations, the effects shall their artistic worth or because they have a sentimental value, he may
retroact, however, to the day of the constitution of the usufruct. demand their delivery to him upon his giving security for the payment
of the legal interest on their appraised value.
(d) Exemption from obligation to give security
ARTICLE 584, NCC. The provisions of No. 2 of the preceding article (1) when no one will be injured thereby; and
shall not apply to the donor who has reserved the usufruct of the (2) when the enjoyment of the property subject of the usufruct is to be
property donated, or to the parents who are usufructuaries of their acquired through caucion juratoria.
children’s property, except when the parents contract a second
marriage.  Caution juratoria refers to the promise under oath made in court
by the usufructuary who has not given security for the purpose of
ARTICLE 225, FC. The father and the mother shall jointly exercise acquiring the use of the following:
legal guardianship over the property of the unemancipated common o furniture necessary for his use;
child without the necessity of a court appointment. In case of o dwelling house; or
disagreement, the father’s decision shall prevail, unless there is a o implements, tools, and other movable property necessary for
judicial order to the contrary. an industry or vocation in which he is engaged.
 In this kind of usufruct, the usufructuary has no right to alienate
Where the market value of the property or the annual income of the his usufructuary right or lease the same for that would mean
child exceeds P50,000, the parent concerned shall be required to that he does not need the house or the furniture or the implements.
furnish a bond in such amount as the court may determine, but not
less than ten per centum (10%) of the value of the property or annual (B) During Life of Usufruct:
income, to guarantee the performance of the obligations prescribed
for general guardians. (a) In general
A verified petition for approval of the bond shall be filed in the proper ARTICLE 562, NCC. Usufruct gives a right to enjoy the property of
court of the place where the child resides, or, if the child resides in a another with the obligation of preserving its form and substance,
foreign country, in the proper court of the place where the property or unless the title constituting it or the law otherwise provides.
any part thereof is situated.
ARTICLE 589, NCC. The usufructuary shall take care of the things
The petition shall be docketed as a summary special proceeding in given in usufruct as a good father of a family.
which all incidents and issues regarding the performance of the
obligations referred to in the second paragraph of this Article shall be ARTICLE 592, NCC. The usufructuary is obliged to make the
heard and resolved. ordinary repairs needed by the thing given in usufruct.
The ordinary rules on guardianship shall be merely suppletory except By ordinary repairs are understood such as are required by the wear
when the child is under substitute parental authority, or the guardian and tear due to the natural use of the thing and are indispensable for
is a stranger, or a parent has remarried, in which case the ordinary its preservation. Should the usufructuary fail to make them after
rules on guardianship shall apply. demand by the owner, the latter may make them at the expense of
the usufructuary.
(1) when the donor has reserved the usufruct of the property
donated; and ARTICLE 596, NCC. The payment of annual charges and taxes and
(2) in case of legal usufruct of the parents over the property of their of those considered as a lien on the fruits, shall be at the expense of
minor children living in their custody and under their parental the usufructuary for all the time that the usufruct lasts.
authority, except
(a) when the parents contract a second marriage or
ARTICLE 593, NCC. Extraordinary repairs shall be at the expense of
(b) when the market value of the property or the annual
the owner. The usufructuary is obliged to notify the owner when the
income of the child exceeds P50,000.
need for such repairs is urgent.
(e) When usufructuary may be relieved of obligation to give

ARTICLE 602, NCC. The expenses, costs and liabilities in suits
security
brought with regard to the usufruct shall be borne by the usufructuary.
ARTICLE 584, NCC. The provisions of No. 2 of the preceding article
shall not apply to the donor who has reserved the usufruct of the
ARTICLE 601, NCC. The usufructuary shall be obliged to notify the
property donated, or to the parents who are usufructuaries of their
owner of any act of a third person, of which he may have knowledge,
children’s property, except when the parents contract a second
that may be prejudicial to the rights of ownership, and he shall be
marriage.
liable should he not do so, for damages, as if they had been caused
through his own fault.
ARTICLE 587, NCC. If the usufructuary who has not given security
claims, by virtue of a promise under oath, the delivery of the furniture
(1) the obligation to preserve its form and substance;
necessary for his use, and that he and his family be allowed to live in
(2) in the performance of the foregoing obligation, he is required to retain the property held in usufruct until he is reimbursed.
observe the diligence of a good father of a family; and (612)
(3) to further carry out the foregoing obligation, the law specifically
tasks the usufructuary: (d) Obligation to notify owner of prejudicial acts
(a) to make ordinary repairs on the property held in usufruct; ARTICLE 601, NCC. The usufructuary shall be obliged to notify the
(b) to pay the annual charges and taxes which are imposed on owner of any act of a third person, of which he may have knowledge,
the fruits of the property held in usufruct; that may be prejudicial to the rights of ownership, and he shall be
(c) to notify the owner of the need of urgent extraordinary liable should he not do so, for damages, as if they had been caused
repairs; through his own fault.
(d) to pay the expenses, costs, and liabilities for suits involving
the usufruct; and  The usufructuary is obliged to notify the owner of any act of a third
(e) to notify the owner of any act of a third person that may be person, of which he may have knowledge, which may be
prejudicial to the rights of the owner. prejudicial to the “rights of ownership.”
 If he fails in this obligation, he shall be liable to the owner for
(b) Ordinary and extraordinary repairs damages, as if such act had been caused through his own fault.
 It is the obligation of the usufructuary to
o make the ordinary repairs needed by the thing given in (C) At termination of usufruct:
usufruct (592),
o while extraordinary repairs shall be made at the expense (a) Return of thing
of the owner (593). Upon the termination of the usufruct, he is obliged to deliver the same to
the owner unless the usufructuary is entitled to exercise the right to
Repair is “ordinary” if two requisites are satisfied: retain the property. (612)
(1) it is required by the wear and tear due to the natural use of the
thing; and (b) Right of retention
(2) it is indispensable for the preservation of the thing. Upon the termination of the usufruct, the usufructuary is entitled to a right
 If both requisites are not satisfied, the repair is “extraordinary.” of retention until payment of the following:
 If the need for extraordinary repairs is urgent and (1) sums that may have been advanced by the usufructuary for
indispensable for the preservation of the thing, the law imposes payment of taxes which are imposed directly on the capital; (597,
an obligation upon the usufructuary to notify the owner of the need 612) and
of such repairs. (2) the increase in the value which the immovable acquired by
reason of the extraordinary repairs paid for by the usufructuary.
 If after notice, the owner still fails to make the extraordinary (594, 612)
repairs, the usufructuary is authorized to make them, in which
case, he acquires the following rights in connection therewith: 4. Causes of Extinguishment of Usufruct
(a) the right to demand of the owner, at the termination of the
usufruct, the increase in value which the immovable may ARTICLE 603, NCC. Usufruct is extinguished:
have acquired by reason of the repair; and (1) By the death of the usufructuary, unless a contrary intention
(b) the right to retain the property held in usufruct pending the clearly appears;
reimbursement by the owner of such expenses. (2) By the expiration of the period for which it was constituted, or by
the fulfillment of any resolutory condition provided in the title
ARTICLE 594 (para. 2), NCC. If the owner should make the creating the usufruct;
extraordinary repairs, he shall have a right to demand of the (3) By merger of the usufruct and ownership in the same person;
usufructuary the legal interest on the amount expended for the time (4) By renunciation of the usufructuary;
that the usufruct lasts. (5) By the total loss of the thing in usufruct;
(6) By the termination of the right of the person constituting the
Should he not make them when they are indispensable for the usufruct;
preservation of the thing, the usufructuary may make them; but he (7) By prescription.
shall have a right to demand of the owner, at the termination of the
usufruct, the increase in value which the immovable may have ARTICLE 606, NCC. A usufruct granted for the time that may elapse
acquired by reason of the repairs. before a third person attains a certain age, shall subsist for the
number of years specified, even if the third person should die before
ARTICLE 612, NCC. Upon the termination of the usufruct, the thing the period expires, unless such usufruct has been expressly granted
in usufruct shall be delivered to the owner, without prejudice to the only in consideration of the existence of such person.
right of retention pertaining to the usufructuary or his heirs for taxes
and extraordinary expenses which should be reimbursed. After the ARTICLE 610, NCC. A usufruct is not extinguished by bad use of the
delivery has been made, the security or mortgage shall be cancelled. thing in usufruct; but if the abuse should cause considerable injury to
the owner, the latter may demand that the thing be delivered to him,
(c) Payment of annual charges and taxes binding himself to pay annually to the usufructuary the net proceeds
 596: Payment of annual charges and taxes and of those considered of the same, after deducting the expenses and the compensation
as a lien on the fruits, shall be at the expense of the usufructuary; which may be allowed him for its administration.
 597: taxes imposed directly on the capital shall be at the
expense of the owner, such as real estate taxes. (Mercado v. Rizal) (1) By the death of the usufructuary, unless a contrary intention clearly
o If the taxes directly imposed on the capital are advanced by appears;
the usufructuary, he is entitled to recover the same from (2) by expiration of the period for which it was constituted, or by
the owner at the termination of the usufruct, with the right to fulfillment of any resolutory condition provided in the title creating
the usufruct;
(3) by merger of the usufruct and ownership in the same person; (3) When either or both of the estates fall into such condition that
(4) by renunciation of the usufructuary; the easement cannot be used; but it shall revive if the
(5) by total loss of the thing in usufruct; subsequent condition of the estates or either of them should
(6) by the termination of the right of the person constituting the again permit its use, unless when the use becomes possible,
usufruct; and sufficient time for prescription has elapsed, in accordance with
(7) by prescription. the provisions of the preceding number;
(4) By the expiration of the term or the fulfillment of the condition, if
 GR: In cases where the usufruct is granted for the time that the easement is temporary or conditional;
may elapse before a third person attains a certain age, the (5) By the renunciation of the owner of the dominant estate;
usufruct shall subsist for the number of years specified, even if the (6) By the redemption agreed upon between the owners of the
third person should die before the period expires. dominant and servient estates.
o Example: if “O” creates a usufruct over his property in favor of
“U” to last until the child of “U” (“C”), who is five years old, ARTICLE 618, NCC. Easements are indivisible. If the servient estate
reaches the age of 18 years old, the usufruct will continue for is divided between two or more persons, the easement is not
another eight years even if “C” dies at the age of 10. modified, and each of them must bear it on the part which
 EXC: When such usufruct has been expressly granted only in corresponds to him.
consideration of the existence of the third person, the usufruct
is extinguished upon the latter’s death. If it is the dominant estate that is divided between two or more
o In the example, if the usufruct was constituted by “O” to help persons, each of them may use the easement in its entirety, without
“U” pay for the support of “C,” the usufruct is extinguished changing the place of its use, or making it more burdensome in any
upon the death of the latter. other way.
 However, a usufruct is not extinguished by bad use of the thing held
in usufruct. (1) It is a real right that falls upon the property itself and
inseparable from the estate to which it actively or passively
II. Easement belongs; therefore, it cannot be alienated or mortgaged
separately from the estate to which it forms part; (Solid Manila
1. Concept Corp. v. Bio Hong Trading Co.)
(2) the right consists of a limited use and enjoyment of the thing
(a) Definition without possession and gives rise to an action in rem in favor of the
ARTICLE 613, NCC. An easement or servitude is an encumbrance owner of the tenement of the easement and against any possessor
imposed upon an immovable for the benefit of another immovable of the servient estate;
belonging to a different owner. (3) the right is always enjoyed over an immovable property—the
term “immovable" in Article 613 NCC should be understood in its
The immovable in favor of which the easement is established is ordinary or vulgar connotation, i.e., referring to those which are,
called the dominant estate; that which is subject thereto, the servient by their nature, cannot be moved from one place to another
estate. such as lands, buildings, and roads;
(a) Can we have an easement over an easement? NO. An
ARTICLE 614, NCC. Servitudes may also be established for the easement can only be constituted on immovable properties,
benefit of a community, or of one or more persons to whom the in the ordinary sense.
encumbered estate does not belong. (4) it is a right which is enjoyed over another’s property, or jura in
re aliena (Amor v. Florentino) hence:
 Easement is a real right on another’s property, corporeal and (a) it is impossible to have an easement over one’s own property;
immovable, whereby the owner of the latter must refrain from (b) if there is a merger in the same person of the ownership of the
doing or allowing somebody else to do or something to be dominant and servient estates, the easement is extinguished;
done on his property, for the benefit of another person or tenement. and
(Pilar Development Corp. v. Dumadag) (c) an acknowledgment of the easement is an admission that the
 Servitude is an encumbrance imposed upon an immovable for the property belongs to another (Vogo-Medellin Milling Co., Inc. v.
benefit of CA); and
o another immovable belonging to a different owner or (5) it is indivisible, even if the servient and dominant estates are
o a community, or divided between two or more persons, the easement or the
o one or more persons to whom the encumbered estate does servitude continues to attach to the estates originally affected.
not belong.
Easement gives the right of temporary use, without possession.
(b) Characteristics
ARTICLE 617, NCC. Easements are inseparable from the estate to (c) Kinds of easement
which they actively or passively belong. ARTICLE 615, NCC. Easements may be continuous or
discontinuous, apparent or nonapparent.
ARTICLE 631(1), NCC. Easements are extinguished:
(1) By merger in the same person of the ownership of the dominant Continuous easements are those the use of which is or may be
and servient estates; incessant, without the intervention of any act of man.
(2) By nonuser for ten years; with respect to discontinuous
easements, this period shall be computed from the day on which Discontinuous easements are those which are used at intervals and
they ceased to be used; and, with respect to continuous depend upon the acts of man.
easements, from the day on which an act contrary to the same
took place;
Apparent easements are those which are made known and are (a) Modes of acquisition
continually kept in view by external signs that reveal the use and
enjoyment of the same. ARTICLE 620, NCC. Continuous and apparent easements are
acquired either by virtue of a title or by prescription of ten years.
Nonapparent easements are those which show no external indication
of their existence. ARTICLE 622, NCC. Continuous nonapparent easements, and
discontinuous ones, whether apparent or not, may be acquired only
ARTICLE 646, NCC. For legal purposes, the easement of aqueduct by virtue of a title.
shall be considered as continuous and apparent, even though the
flow of the water may not be continuous, or its use depends upon the  Either by title or by prescription.
needs of the dominant estate, or upon a schedule of alternate days  Title: All easements, whether continuous or discontinuous,
or hours. apparent or non-apparent, positive or negative, can be acquired
by title.
ARTICLE 616, NCC. Easements are also positive or negative. o "Title” refers to a juridical justification for the acquisition of a
right, such as law, a will, a donation, or a contract.” (Alolino v.
A positive easement is one which imposes upon the owner of the Flores)
servient estate the obligation of allowing something to be done or of  As to prescription, only continuous and apparent easements
doing it himself, and a negative easement, that which prohibits the may be acquired by virtue thereof.”
owner of the servient estate from doing something which he could o The easement must be both continuous and apparent.
lawfully do if the easement did not exist. o For example, an easement of right of way is not acquirable
by prescription because it is always a discontinuous
(1) As to recipient of benefit: easement. (Bogo-Medellin Milling)
(a) Real or praedial easement - where the easement is for the  BUT Bogo-Medellin: allowed the acquisition of easement
benefit of another immovable belonging to a different owner, of right of way because the road was cemented. This was
the immovable in favor of which the easement is established the justification that the road was apparent.
is called “dominant estate”; that which is subjected thereto, o However, an easement of light and view can be acquired
the “servient estate;” (613) or through prescription counting from the time when the owner
(b) Personal easement – where the easement is for the benefit of the dominant estate formally prohibits the adjoining lot
of a community, or of one or more persons to whom the owner from blocking the view of a window located within the
encumbered estate does not belong, (614) or the easement dominant estate.” (Alolino v. Flores)
pertains to persons without a dominant estate.” (Solid Manila
Corp. v. Bio Hong Trading Co., Inc.) (b) Through prescription
(2) As to source
(a) Legal or compulsory easement – those constituted by law (1) Period: 10 years; (620)
which has for its object either public use or the interest of
private persons (Pilar Dev. Corp. v. Dumadag); or (2) When easement is positive
(b) Voluntary easement – those constituted by will or agreement ARTICLE 621, NCC. In order to acquire by prescription the
of the parties (La Vista Association, Inc. v. CA); but it is only easements referred to in the preceding article, the time of possession
the owner who can create a servitude that will bind the shall be computed thus: in positive easements, from the day on which
servient estate. the owner of the dominant estate, or the person who may have made
(3) As to manner of exercise: use of the easement, commenced to exercise it upon the servient
(a) Continuous easement – if its use is, or may be, incessant estate; and in negative easements, from the day on which the owner
without the intervention of any act of man, like the easement of the dominant estate forbade, by an instrument acknowledged
of drainage (615, 646) or easement of light and view; or before a notary public, the owner of the servient estate, from
(b) Discontinuous easement – if it is used at intervals and it executing an act which would be lawful without the easement.
depends on the act of man, like the easement of right of way;
(c) Apparent easement - those which are made known and are Period is counted from the day on which the owner of the dominant
continually kept in view by external signs that reveal the use estate commenced to exercise it upon the servient estate.
and enjoyment of the same, such as a road (which reveals a
right of way) and a window (which evidences a right to light (3) When easement is negative
and view); or  Period is counted from the day on which the owner of the dominant
(d) Non-apparent easement – those which show no external estate forbade, by an instrument acknowledged before a notary
indication of their existence,’ such as an easement of not public, the owner of the servient estate, from executing an act
building beyond a certain height; (Bogo-Medellin Milling) which would be lawful without the easement.
(e) Positive easement - that which imposes upon the owner of  To illustrate, if easement of light and view is made upon one’s own
the servient estate the obligation of allowing something to be wall, the easement, being a negative one, is acquired by
done on his property (servitutes in patendo), such as an prescription only after the lapse of 10 years counted from the day
easement of right of way; or on which the owner of the dominant estate forbade, by an
(f) Negative easement - that which prohibits the owner of the instrument acknowledged before a notary public, the owner of the
servient estate from doing something on his property which he servient estate, from executing an act which would be lawful
could lawfully do if the easement did not exist (servilities in without the easement. (Cortes v. Yu-Tibo)
non faciendo), in such as an easement not to build higher  If made on the wall of the neighbor, being a positive easement, the
(altius non tollendi) (Amor v. Tolentino) 10-year prescriptive period commences from the time of the
opening of the window.
2. Acquisition of Easement
If I open a window on MY WALL, there is no easement. It’s an exercise Article 624 is an exception carved out by the CC that must be taken
of ownership. To be an easement, it must be imposed on the property of out of the coverage of the general rule that an easement of light
someone else. For example, you prohibit your neighbor from and view in the case of windows opened in one’s own wall is a
constructing anything that blocks your light and view. negative easement that may only be acquired by prescription,
tacked from a formal prohibition relayed to the owner of the servient
For the 10-year period to run, you have to execute a notarial document estate. (Garcia v. Santos)
containing the prohibition.
(d) Proof of easement
(c) Easement by apparent sign or legal presumption: ARTICLE 623, NCC. The absence of a document or proof showing
(1) Situation applicable the origin of an easement which cannot be acquired by prescription
ARTICLE 624, NCC. The existence of an apparent sign of easement may be cured by a deed of recognition by the owner of the servient
between two estates, established or maintained by the owner of both, estate or by a final judgment.
shall be considered, should either of them be alienated, as a title in
order that the easement may continue actively and passively, unless, The absence of a document or proof showing the origin of an easement
at the time the ownership of the two estates is divided, the contrary which cannot be acquired by prescription may be cured by a deed of
should be provided in the title of conveyance of either of them, or the recognition by the owner of the servient estate or by a final judgment.
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 3. Rights and Obligations
in common by two or more persons.
(a) Effect on owner of servient estate
 Article 624 applies in situations wherein two or more estates were  An easement gives the holder of the easement an incorporeal
previously owned by a singular owner, or even a single estate but interest on the property but grants no title thereto. (Bogo-Medellin)
with two or more portions being owned by a singular owner. (Garcia  Hence, the owner of the servient estate retains the ownership of
v. Santos) the portion on which the easement is established, and may use the
 At that time, or prior to the division of ownership, there exists same in such a manner as not to affect the exercise of the
between the two estates an apparent sign of easement. easement. (Mercader, Jr. v. Bardillas)
 Originally, therefore, there is no true easement that exists as there  However, he may not exercise some of his property rights for the
is only one owner. benefit of the person who was granted the easement of right of way;
 Hence, at the outset, no other owner is imposed with a burden. (Reyes v. Valentin) hence, he may not enclose his property, nor
 Subsequently, one estate or a portion of the estate is alienated in obstruct or hinder the free passage over the servient estate.
favor of another person,
o wherein, in that estate or portion of the estate, an apparent (b) Rights of owner of dominant estate
visible sign of an easement exists.
ARTICLE 625, NCC. Upon the establishment of an easement, all the
(2) When easement exists rights necessary for its use are considered granted.
 According to Article 624, there arises a title to an easement of
light and view, even in the absence of any formal act ARTICLE 627, NCC. The owner of the dominant estate may make,
undertaken by the owner of the dominant estate, if this apparent at his own expense, on the servient estate any works necessary for
visible sign, such as the existence of a door and windows, the use and preservation of the servitude, but without altering it or
continues to remain and subsist, unless, at the time the rendering it more burdensome.
ownership of the two estates is divided:
(a) the contrary should be provided in the title of conveyance of For this purpose he shall notify the owner of the servient estate, and
either of them, or shall choose the most convenient time and manner so as to cause
(b) the sign aforesaid should be removed before the execution of the least inconvenience to the owner of the servient estate.
the deed.
 Upon the establishment of an easement, all the rights necessary
(3) Requisites for application of Article 624: for its use are considered granted.
(a) there exists an apparent sign of servitude between two  The owner of the dominant estate shall have the right to make
estates; any works on the servient estate if the same be necessary for
(b) at the time of the establishment of such sign, the ownership the use and preservation of the servitude, subject to the
of the two estates resides in one person; following limitations:
(c) the sign of the easement is established by the owner of both (a) the work must be necessary for the use and preservation
estates, because the article will not apply when the easement of the servitude;
is established by a person different from the owner; (b) the work is done at the expense of the owner of the
(d) that the ownership over the two estates is later on divided, dominant estate;
either by alienation or partition; and (c) the work can be done without altering the servitude or
(e) at the time of division of ownership, nothing is stated in the rendering it more burdensome;
document of alienation or partition contrary to the easement (d) the owner of the servient estate is first notified of the intended
nor is the sign of the easement removed before the execution work; and
of the document. (e) the time and manner of making the work should be the most
Under Article 624 the existence of the apparent sign has for all legal convenient to the owner of the servient estate or it is done
purposes the same character and effect as a title of acquisition of the in such a manner that it causes the least inconvenience to the
easement. (Amor v. Tolentino) owner of the servient estate.
(4) Exception to rule on negative easement (c) Limitations upon rights of owner of dominant estate:
(1) it can only exercise rights necessary for the use of the 5. Legal or Compulsory Easement
easement;
(2) it cannot use the easement except for the benefit of the If a lessee was granted a right of way on a property subject of lease, this
immovable originally contemplated; will NOT be considered an easement.
(3) it cannot exercise the easement in any other manner than that
previously established; An easement is a real right. For a voluntary right of way to become a
(4) it cannot construct anything on it which is not necessary for real right, it must be the OWNER of the servient estate who constitutes
the use and preservation of the easement; / agrees to the easement on the estate. If it’s some other person, like a
(5) it cannot alter or make the easement more burdensome; lessee, it’s technically not an easement. The obligation attaches only to
(6) it must notify the servient estate owner of its intention to make the PERSON. This is simply a CONTRACT, not an easement. This is
necessary works on the servient estate; and coterminous with the contract of lease.
(7) it should choose the most convenient time and manner to build
said works so as to cause the least inconvenience to the owner of (A) Easement of drainage of waters:
the servient estate. Any violation of the above constitutes (a) When easement exists
impairment of the easement. When, based on the physical condition of two estates, waters descend
naturally and without the intervention of man from a higher estate
(Goldcrest Realty Corp. v. Cypress Gardens Condominium Corp.) (the dominant estate) to a lower estate (the servient estate). (Ongsiako
v. Ongsiako)
4. Modes of Extinguishment
(b) Obligation of lower estate
ARTICLE 631, NCC. Easements are extinguished: ARTICLE 637, NCC. Lower estates are obliged to receive the waters
(1) By merger in the same person of the ownership of the dominant which naturally and without the intervention of man descend from the
and servient estates; higher estates, as well as the stones or earth which they carry with
(2) By nonuser for ten years; with respect to discontinuous them.
easements, this period shall be computed from the day on which
they ceased to be used; and, with respect to continuous The owner of the lower estate cannot construct works which will
easements, from the day on which an act contrary to the same impede this easement; neither can the owner of the higher estate
took place; make works which will increase the burden.
(3) When either or both of the estates fall into such condition that
the easement cannot be used; but it shall revive if the ARTICLE 50, WC. Lower estates are obliged to receive the waters
subsequent condition of the estates or either of them should which naturally and without the intervention of man flow from the
again permit its use, unless when the use becomes possible, higher estates, as well as the stone or earth which they carry with
sufficient time for prescription has elapsed, in accordance with them.
the provisions of the preceding number;
(4) By the expiration of the term or the fulfillment of the condition, if The owner of the lower estate can not construct works which will
the easement is temporary or conditional; impede this natural flow, unless he provides an alternative method of
(5) By the renunciation of the owner of the dominant estate; drainage; neither can the owner of the higher estate make works
(6) By the redemption agreed upon between the owners of the which will increase this natural flow.
dominant and servient estates.
To receive the waters which naturally and without the intervention
(1) Merger – because easement is a right enjoyed over another’s of man flow from the higher estates, as well as the stones or earth
property; hence, if there is a merger in the same person of the which they carry with them.
ownership of the dominant and servient estates, the easement is
extinguished; (c) Obligations of higher estate
(2) non-use – for easement to be extinguished under this mode, it is The owner of the higher estate may not construct works which will
necessary that the non-use must have lasted for a period of 10 increase the burden or increase the natural flow.
years;
(a) if the easement is discontinuous, the 10-year period is (B) Easement for public use
computed from the day on which the easement was not used, ARTICLE 51, WC. The banks of rivers and streams and the shores
(b) if the easement is continuous, in which case the use of the of the seas and lakes throughout their entire length and within a zone
easement does not depend upon the acts of man, the 10-year of three (3) meters in urban areas, twenty (20) meters in agricultural
period is counted from the day on which an act contrary to the areas and forty (40) meters in forest areas, along their margins, are
easement took place; subject to the easement of public use in the interest of recreation,
(3) impossibility of use; navigation, floatage, fishing and salvage. No person shall be allowed
(4) expiration of term; to stay in this zone longer than what is necessary for recreation,
(5) fulfillment of condition; navigation, floatage, fishing or salvage or to build structures of any
(6) renunciation; kind.
(7) redemption – it is the release of the servient estate from the
servitude upon agreement of the owners of both and upon  The banks of rivers and streams and the shores of the seas
payment by the owner of the servient estate of the and lakes throughout their entire length and within a zone of
corresponding consideration to the owner of the dominant estate; three meters in urban areas, 20 meters in agricultural areas
(8) annulment or rescission of title constituting the easement; and 40 meters in forest areas, along their margins, are subject
(9) termination of the right of the grantor; to the easement of public use in the interest of recreation,
(10) abandonment of the servient estate; and navigation, floatage, fishing, and salvage.
(11) eminent domain. (Manresa)
 But no person shall be allowed to stay in this zone longer than what way through the neighboring estates, after payment of the proper
is necessary for recreation, navigation, floatage, fishing, or salvage indemnity.
or to build structures of any kind.
Should this easement be established in such a manner that its use
(C) Easement of Aqueduct may be continuous for all the needs of the dominant estate,
(a) When easement exists establishing a permanent passage, the indemnity shall consist of the
ARTICLE 642, NCC. Any person who may wish to use upon his own value of the land occupied and the amount of the damage caused to
estate any water of which he can dispose shall have the right to make the servient estate.
it flow through the intervening estates, with the obligation to indemnify
their owners, as well as the owners of the lower estates upon which In case the right of way is limited to the necessary passage for the
the waters may filter or descend. cultivation of the estate surrounded by others and for the gathering
of its crops through the servient estate without a permanent way, the
If a person wishes to use upon his estate any water of which he can indemnity shall consist in the payment of the damage caused by such
dispose, he shall have the right to make it flow through intervening encumbrance.
estates.
This easement is not compulsory if the isolation of the immovable is
(b) Requisites due to the proprietor's own acts.
ARTICLE 642, NCC. Any person who may wish to use upon his own
estate any water of which he can dispose shall have the right to make ARTICLE 650, NCC. The easement of right of way shall be
it flow through the intervening estates, with the obligation to indemnify established at the point least prejudicial to the servient estate, and,
their owners, as well as the owners of the lower estates upon which insofar as consistent with this rule, where the distance from the
the waters may filter or descend. dominant estate to a public highway may be the shortest.
ARTICLE 643, NCC. One desiring to make use of the right granted (1) that the dominant estate is surrounded by other immovables and
in the preceding article is obliged: has no adequate outlet to a public highway (Art. 649, par. 1);
(1) To prove that he can dispose of the water and that it is sufficient (2) there must be payment of proper indemnity (Art. 649, par. 1);
for the use for which it is intended; (3) that the isolation was not due to acts of the proprietor of the
(2) To show that the proposed right of way is the most convenient dominant estate (Art. 649, par. 4); and
and the least onerous to third persons; (4) that the right of way claimed is at the point least prejudicial to
(3) To indemnify the owner of the servient estate in the manner the servient estate; and insofar as consistent with this rule, where
determined by the laws and regulations. the distance from the dominant estate to a public highway may be
the shortest (Art. 650).
(1) that he who wants to establish the easement of aqueduct must be (Williams v. Zerda)
able to prove that he can dispose of the water;
(2) he must also prove that it is sufficient for the use for which it is  In AMA Land, Inc. v. Wack Wack Residents’ Association, Inc.,
intended; the Court cited an additional requisite: that the right of way must
(3) the proposed right of way is the most convenient and the least be absolutely necessary for the normal enjoyment of the
onerous to third persons affected; and dominant estate by its owner.
(4) he must indemnify the owners of the servient estates (intervening  However, in Reyes v. Ramos, the Court explained that while the
estates), as well as the owners of the lower estates upon which the aspect of necessity may not be specifically included in the
waters may filter or descend. requisites for the grant of compulsory easement under the Civil
Code, however, this goes into the question of “least prejudice.”
(c) Nature of easement
ARTICLE 646, NCC. For legal purposes, the easement of aqueduct (b) Requirement of isolation
shall be considered as continuous and apparent, even though the  An owner cannot, by his own act, isolate his property from a public
flow of the water may not be continuous, or its use depends upon the highway and then claim an easement of way through an adjacent
needs of the dominant estate, or upon a schedule of alternate days estate. (Francisco v. IAC)
or hours.  However, the mere fact that the purchaser of a parcel of land knew
that the property he was buying was already surrounded by other
ARTICLE 620, NCC. Continuous and apparent easements are immovables, leaving him no adequate ingress or egress to a public
acquired either by virtue of a title or by prescription of ten years. highway, cannot prevent him from demanding later on a
compulsory right of way. (Williams v. Zerda)
 The easement of aqueduct shall be considered as continuous and
apparent, even though the flow of the water may not be (c) Requirement of inadequacy of outlet to public highway
continuous, or its use depends upon the needs of the dominant  The convenience of the dominant estate has never been the gauge
estate, or upon a schedule of alternate days or hours. for the grant of compulsory right of way. The true standard for the
 Hence, an easement of aqueduct may be acquired either by title grant of the legal right is adequacy. (Reyes v. Ramos)
or by prescription.  Hence, when there is already an existing adequate outlet from
the dominant estate to a public highway, even if the said outlet
(D) Compulsory Easement of Right of Way be inconvenient, the need to open up another servitude is
(a) Requisites entirely unjustified.
ARTICLE 649, NCC. The owner, or any person who by virtue of a
real right may cultivate or use any immovable, which is surrounded (d) At point least prejudicial
by other immovables pertaining to other persons and without  The least prejudice criterion must prevail over the shortest
adequate outlet to a public highway, is entitled to demand a right of distance criterion. (Williams v. Zerda)
 Least prejudice is about the suffering of the servient estate, not of ARTICLE 673, NCC. Whenever by any title a right has been acquired
the dominant estate. (Reyes v. Ramos) to have direct views, balconies or belvederes overlooking an
adjoining property, the owner of the servient estate cannot build
(e) Who may claim right of way thereon at less than a distance of three meters to be measured in the
ARTICLE 649, NCC, supra. manner provided in article 671. Any stipulation permitting distances
less than those prescribed in article 670 is void.
 It is the owner, or any person who by virtue of a real right may
cultivate or use any immovable surrounded by other  GR: when a window or any similar opening affords a direct view of
immovables pertaining to other persons, who is entitled to demand an adjoining land, the distance between the wall in which such
a right of way through the neighboring estates. opening is made and the border of the adjoining land should be at
 While a usufructuary is entitled to demand a right of way pursuant least two meters;
to Article 649, a mere lessee does not enjoy the same right.  EXC: in a situation wherein an easement is established or
o With respect to the latter, his action is against the lessor who recognized by title or prescription, affording the dominant estate the
is bound to maintain him in the enjoyment of the property. right to have a direct view overlooking the adjoining property,
o i.e., the servient estate, as in the case of Article 624, the owner
(f) Effect of opening adequate outlet of the servient estate cannot build thereon at less than a
The opening of an adequate outlet to a highway can extinguish only distance of 3 meters, not 2 meters, from the property line.
legal or compulsory easements, not voluntary easements.
(Unisource Commercial and Development Corp. v. Chung) (d) Distance requirement in oblique views
with respect to the side or oblique views upon or towards such
(E) Easement of Light and View: conterminous property, the law requires that the distance be 60 cm.
(a) Concept (670)
 It is an easement whereby the dominant estate enjoys the right
to have free access to light, a little air, and a view overlooking (F) Easement of Drainage of Buildings:
the adjoining estate, i.e., the servient estate. (Garcia v. Santos) (a) Concept
 It has two components. The easement of drainage of buildings is the right to divert or empty the
o The easement of light or jus luminum has the purpose of rainwaters from one’s own roof or shed to the neighbor’s estate, either
admitting light and a little air, as in the case of small windows, drop by drop or through conduits.
not more than 30 cm2, at the height of the ceiling joists or
immediately under the ceiling. (b) Requisites
o The easement of view or servid umbre prospectus has the ARTICLE 676, NCC. Whenever the yard or court of a house is
principal purpose of affording view, as in the case of full or surrounded by other houses, and it is not possible to give an outlet
regular windows overlooking the adjoining estate. through the house itself to the rain water collected thereon, the
 The easement of light and view is intrinsically intertwined with the establishment of an easement of drainage can be demanded, giving
easement of the servient estate not to build higher or altius non an outlet to the water at the point of the contiguous lands or
tollendi. tenements where its egress may be easiest, and establishing a
o These two necessarily go together “because an easement of conduit for the drainage in such manner as to cause the least
light and view requires that the owner of the servient estate damage to the servient estate, after payment of the proper indemnity.
shall not build to a height that will obstruct the window.”
(1) the yard or court of a house must be surrounded by other houses
(b) Two kinds of windows (“the dominant estate”) and it is not possible to give an outlet
(1) regular or full or direct view windows — those openings which through the house itself to the rain collected therefrom;
are made on a wall parallel or almost parallel to the line that divides (2) the outlet to the water must be at the point of the contiguous
the estates, in such a way that the neighboring tenement can be lands or tenements (“the servient estate”) where its egress may be
seen without putting out or turning the head; or easiest;
(2) restricted, or oblique or side view windows – those openings in (3) the conduit for the drainage must be established in such manner
a wall which form an angle to the boundary line, and therefore of as to cause the least damage to the servient estate; and
necessity requires in order to see the neighboring tenement to (4) proper indemnity must be paid to the owner of the servient estate.
thrust the head out of the opening and look to the right or left.
(Garcia v. Santos) (G) Intermediate Distances for Planting
(c) Observation of certain distances in direct views (a) Required distances

ARTICLE 670, NCC. No windows, apertures, balconies, or other ARTICLE 679, NCC. No trees shall be planted near a tenement or
similar projections which afford a direct view upon or towards an piece of land belonging to another except at the distance authorized
adjoining land or tenement can be made, without leaving a distance by the ordinances or customs of the place, and, in the absence
of two meters between the wall in which they are made and such thereof, at a distance of at least two meters from the dividing line of
contiguous property. the estates if tall trees are planted and at a distance of at least fifty
centimeters if shrubs or small trees are planted.
Neither can side or oblique views upon or towards such conterminous
property be had, unless there be a distance of sixty centimeters. Every landowner shall have the right to demand that trees hereafter
planted at a shorter distance from his land or tenement be uprooted.
The nonobservance of these distances does not give rise to
prescription. The provisions of this article also apply to trees which have grown
spontaneously.
No trees shall be planted near a tenement or piece of land belonging to A voluntary easement may only be constituted upon the will of the owner
another except at the distance: of the servient estate.
(1) that required by local ordinances;
(2) in default thereof, (b) If property held in usufruct
(a) two meters from the dividing line of the estate in case of ARTICLE 689, NCC. The owner of a tenement or piece of land, the
tall trees and usufruct of which belongs to another, may impose thereon, without
(b) at least 50 cm in case of shrubs or small trees. the consent of the usufructuary, any servitudes which will not injure
the right of usufruct.
(b) Right to cut branches
ARTICLE 680, NCC. If the branches of any tree should extend over The naked owner may impose any servitude on his property even
a neighboring estate, tenement, garden or yard, the owner of the without the consent of the usufructuary.
latter shall have the right to demand that they be cut off insofar as
they may spread over his property, and, if it be the roots of a (c) If co-owned property
neighboring tree which should penetrate into the land of another, the ARTICLE 691, NCC. In order to impose an easement on an
latter may cut them off himself within his property. undivided tenement, or piece of land, the consent of all the co-owners
 If the branches of any tree should extend over a neighboring shall be required.
estate, the owner of the latter does not have the right to cut the
branches extending on his property. The consent given by some only, must be held in abeyance until the
o Instead, he may demand that the protruding branches be cut last one of all the co-owners shall have expressed his conformity.
off by its owner.
o If his demand is not acted upon, he has to go to court to seek But the consent given by one of the co-owners separately from the
authority for the cutting of the protruding branches. others shall bind the grantor and his successors not to prevent the
exercise of the right granted.
(c) Right to cut roots
with respect to the roots of a neighboring tree which penetrated into the Unanimous consent of all co-owners is required in order to constitute
land of another, the owner of the latter may himself cut off the roots found a voluntary easement upon the same.
within his property.
JJ. Nuisance
(H) Easement of Lateral Subjacent Support
(a) Concept 1. Concept and Kinds
 The right of lateral and subjacent support is the right to have land
supported by the adjoining land or the soil beneath. (Black’s Law (a) Definition
Dictionary) ARTICLE 694, NCC. A nuisance is any act, omission, establishment,
 Support is lateral when the supported and the supporting lands are business, condition of property, or anything else which:
divided by a vertical plane. (1) Injures or endangers the health or safety of others; or
 Support is subjacent when the supported land is above and the (2) Annoys or offends the senses; or
supporting land is beneath it. (Restate if the Law of Torts) (3) Shocks, defies or disregards decency or morality; or
(4) Obstructs or interferes with the free passage of any public
(b) Obligation of servient estate highway or street, or any body of water; or
ARTICLE 684, NCC. No proprietor shall make such excavations (5) Hinders or impairs the use of property.
upon his land as to deprive any adjacent land or building of sufficient
lateral or subjacent support. A nuisance is defined as any act, omission, establishment, business,
condition of property, or anything else which: (HOSAI)
 The law prohibits any excavation upon one’s land if the same will (1) Injures or endangers the health or safety of others; or
deprive any adjacent land or building of sufficient lateral or (2) Annoys or offends the senses; or
subjacent support. (3) Shocks, defies or disregards decency or morality; or
 In addition, the law prohibits any stipulation or testamentary (4) Obstructs or interferes with the free passage of any public
provision allowing such kind of excavation. highway or street, or any body of water; or
 Any such stipulation or testamentary provision is expressly (5) Hinders or impairs the use of property.”
declared to be void.
 For example, a house constructed on a vacant barrio road is a
(c) Annotation not necessary nuisance per se because any establishment that obstructs or
 An annotation of the existence of the subjacent and lateral support interferes with the free passage of any public highway or street, or
is no longer necessary. It exists whether or not it is annotated or any body of water is a nuisance. (Alolino v. Flores)
registered in the registry of property.  The law on nuisance is a restriction or limitation upon ownership
 A judicial recognition of the same already binds the property and and a manifestation of the principle that every person should so
the owner of the same, including her successors-in-interest. use his property as not to cause damage or injury to others—"sic
 Otherwise, every adjoining landowner would come to court or have utere tuo ut alienum non laedas.” (Lebayen v. A.S. Diaz Electric
the easement of subjacent and lateral support registered in order Service, Inc.)
for it to be recognized and respected. (Castro v. Monsod)
(b) Kinds of nuisance
6. Voluntary Easement (1) As to object it affects:
(a) Public nuisance - affects a community or neighborhood or
(a) Concept any considerable number of persons, although the extent of
the annoyance, danger, or damage upon individuals may be
unequal; (Cruz v. Pandacan Hiker’s Club, Inc.)
(b) Private nuisance - violates only private rights and produces  EX: the Court struck down the ordinance passed by the
damages to but one or a few persons; (Cruz, supra; Rana v. City Council of Manila prohibiting the operation of
Wong) sauna parlors, massage parlors, karaoke bars, night
(c) Mixed nuisance - both public and private in its effects, public clubs, day clubs, super clubs, discotheques, cabarets,
because it injures many persons or all the community, and dance halls, motels, and inns within the Ermita-Malate
private in that it also produces special injuries to private rights area because these establishments are not a nuisance
(Black’s Law Dictionary) per se. (City of Manila v. Judge Laguio)
(2) As to susceptibility to summary abatement  However, mayors are empowered to order the
(a) Nuisance per se (or nuisance at law) - that which is a closure and removal of illegally constructed
nuisance under any and all circumstances, because it establishments for failing to secure the necessary
constitutes a direct menace to public health or safety, and, building permits, whether the building constituted a
for that reason, may be abated summarily under the undefined nuisance per se or a nuisance per accidens. (Aquino v.
law of necessity; (Aquino v. Municipality of Malay, Aklan) Municipality of Malay)
(b) Nuisance per accidens (or nuisance in fact) –
(i) that which will become a nuisance depending upon (c) Who may abate
certain conditions and circumstances, and its ARTICLE 700, NCC. The district health officer shall take care that
existence being a question of fact, it cannot be abated one or all of the remedies against a public nuisance are availed of.
without due hearing thereon in a tribunal authorized to
decide whether such a thing does in law constitute a  Under Article 700 NCC, City and/or the Municipal Health Officer is
nuisance. (North Greenhills Association, Inc. v. Morales) charged with the responsibility of abating public nuisances.
(ii) The traditional test for determining the existence of a o The chief executive of the LGU, like the Punong Barangay, is
nuisance perse is whether the nuisance has become not authorized to determine the propriety of a summary
dangerous at all times and under all circumstances abatement. (Cruz v. Pandacan)
to life, health, or property. (Suddeth v. Knight)  A private person may abate a public nuisance which is specially
injurious to him by removing, or if necessary, by destroying the
Take Note: thing if it is a nuisance per se;
Aquino v. Malay – take note of the building codes. Under the LGU, local
chief executives are empowered to implement the provisions of the Prior to the abatement, it is necessary:
National Building Code. The concept of “nuisance” was not applicable in (1) that demand be first made upon the owner or possessor of the
this case. The hotel was demolished because of the requirements of the property to abate the nuisance;
National Building Code. (2) that such demand has been rejected;
(3) that the abatement be approved by the district health officer
(c) Doctrine of attractive nuisance and executed with the assistance of the local police; and
One who maintains on his premises dangerous instrumentalities or (4) that the value of the destruction does not exceed P3,000. (Cruz
appliances of a character likely to attract children in play, and who v. Pandacan)
fails to exercise ordinary care to prevent children from playing
therewith or resorting thereto, is liable to a child of tender years KK. Modes of Acquiring and Transmitting Ownership
who is injured thereby, even if the child is technically a trespasser in the
premises. (Hidalgo Enterprises, Inc. v. Balandan; Taylor v. Manila 1. Modes of Acquisition of Ownership
Electric)
(a) Seven Modes
2. Remedies against Nuisance
ARTICLE 709, NCC. The titles of ownership, or of other rights over
(a) Remedies in general immovable property, which are not duly inscribed or annotated in the
(1) abatement, either: Registry of Property shall not prejudice third persons.
(a) judicial or
(b) summary; OLDTIPS
(2) civil action for recovery of damages, in case of injury to a private (1) Occupation;
person; and (2) Law;
(3) criminal prosecution, in case of public nuisance, (3) Donation;
(4) Tradition;
(b) Summary abatement (5) Intellectual Creation;
 Unless a nuisance is a nuisance per se, it may not be summarily (6) Prescription; and
abated. (Rana v. Wong) (7) Succession.
 SC has clarified that the abatement of a nuisance without
judicial proceedings is possible only if it is a nuisance per se. (b) Original and derivative mode
o Unless a thing is a nuisance per se, however, it may not be (1) Original mode
abated via an ordinance, without judicial proceedings. (a) when they result in the independent creation of a new right
(Lucena Grand Central Terminal, Inc. v. Jac Liner, Inc.) of ownership, independent of the ownership of a definite third
o Such ordinance is null and void because it violates the person
guarantee of due process under the Constitution. (Salao v. (b) such as occupation, acquisitive prescription, law, and
Santos) intellectual creation;
o Generally, LGUs have no power to declare a particular thing (2) Derivative mode
as a nuisance unless such a thing is a nuisance per se. (a) depend on the existence of the right of another person
(Aquino v. Municipality of Malay, Aklan) (b) such as succession, donation, and tradition.
2. Law as Mode Importance of intention to deliver

 In all forms of delivery, it is necessary that the act of delivery,
(a) Concept whether constructive or actual, should be coupled with the intention
Those special legal provisions which directly vest ownership or of delivering the thing. The act, without the intention, is insufficient.
real rights in favor of certain persons, independently of the other modes (Union Motor Corporation v. CA)
of acquiring and transmitting ownership or other real rights.  The critical factor in the different modes of effecting delivery, which
gives legal effect to the act, is the actual intention of the vendor to
(b) Examples deliver, and its acceptance by the vendee. Without that intention,
ARTICLE 681, NCC. Fruits naturally falling upon adjacent land there is no tradition.
belong to the owner of said land.
(d) Kinds of tradition (delivery)
ARTICLE 1434, NCC. When a person who is not the owner of a thing (1) Real tradition (physical or actual delivery) –
sells or alienates and delivers it, and later the seller or grantor o it takes place when the thing is placed in the control and
acquires title thereto, such title passes by operation of law to the possession of the grantee,
buyer or grantee.  if it is movable, is when the thing is transferred from
hand to hand and,
(1) Fruits naturally falling upon adjacent land belong to the owner of  if immovable, by certain material and possessory acts
said land; and by the grantee in the presence and with the consent of
(2) When a person who is not the owner of a thing sells or the grantor, such as gathering fruits or entering upon the
alienates and delivers it, and later the seller or grantor acquires property which are generally called taking possession.
title thereto, such title passes by operation of law to the buyer or (Castan)
grantee. (2) Constructive (feigned) tradition
o delivery may exist even when the change of possession is not
3. Tradition or Delivery actual or material but represented by other signs or acts
indicative thereof, in which case the tradition is classified as a
(a) Mode distinguished from title constructive one.
 Mode is the legal means by which dominion or ownership is (3) Quasi-tradition
created, transferred, or destroyed, but title is only the legal o Used to indicate the transfer of rights or incorporeal things
basis by which to affect dominion or ownership. (San Lorenzo through the exercise of the rights by the grantee with the
Development Corp. v. CA) acquiescence of the grantor.
o Contracts require tradition.
o Contracts are not modes of acquiring ownership. At best, they (e) Forms of constructive delivery
provide a legal basis to acquire ownership. Tradition or (1) Traditio simbolica
delivery is the actual mode of acquisition.  the transfer of ownership is effected by the delivery of symbols or
 Title is every juridical act, right, or condition which gives a things which represent those to be delivered.
means to the acquisition of ownership and other real rights but o Thus in the Article 1498 paragraph 2 NCC, it is provided that
which in itself is insufficient to produce them. (Sanchez Roman) "with regard to movable property, its delivery may also be
made by the delivery of the keys of the place or depository
(b) Contracts only create title where it is stored or kept."
 Contracts, under our laws, only constitute titles or rights to the o In case of immovable property, symbolic delivery is effected
transfer or acquisition of ownership, while delivery or tradition is by the execution of a public instrument. The execution of a
the mode of accomplishing the same. (San Lorenzo Dev.) public instrument is recognized by law as equivalent to the
 It is tradition or delivery, as a consequence of contracts, that delivery of the thing which is the object of the contract.
actually transfers ownership. (Addison v. Felix and Tioco)
 Exception: There is no delivery notwithstanding the execution of a
Is there a contract which does not require delivery? YES, donation public instrument when:
(a) the instrument itself expresses or implies that delivery was not
(c) Concept intended; or
(b) by other means it is shown that such delivery was not effected,
Definition: Tradition (traditio) or delivery, as a mode of acquiring and because a third person was actually in possession of the
transmitting ownership and other real rights, refers to the transfer of thing, in which case fiction yields to reality—the delivery has
possession accompanied by an intention to transfer ownership or not been effected.
other real rights. (i) Constructive must yield to real. For example, if real
delivery cannot be made because the property is with
Requisites: someone else, constructive delivery must likewise fail.
(1) pre-existence of the right to be transmitted in the estate of the (2) Traditio longa manu
grantor, the same being a derivative mode of acquiring ownership; o the transfer of ownership is effected by the grantor by simply
(2) just cause or title (causa traditionis) for the transmission, such as pointing out to the grantee the things which are being
sale; transferred and which at the time must be within their sight.
(3) intention on the part of the grantor to grant and on the part of the (3) Traditio brevi manu
grantee to acquire; o where the grantee has already acquired actual control or
(4) capacity to transmit (on the part of the grantor) and capacity to possession of the thing, as when the thing is leased to him,
acquire (on the part of the grantee); and in which case, a mere declaration on the part of the grantor
(5) an act which gives it outward form, physically, symbolically, or that the grantee shall now hold the thing which is already in
legally. his control and possession, as owner, operates as a form of
delivery.
(4) Traditio constitution possessorium ARTICLE 1137, NCC. Ownership and other real rights over
o where delivery is effected by a mere declaration on the part immovables also prescribe through uninterrupted adverse
of the transferor that he will hold the thing for the possession thereof for thirty years, without need of title or of good
transferee, and this may take place when the owner of the faith.
thing alienates it but continues possessing it under another
contract or capacity, such as a lessee for example. (1) Movable
(a) four years if ordinary
What is important? INTENT to deliver for the purpose of transmitting (b) eight years if extraordinary.
ownership (2) Immovable
(a) 10 years if ordinary;
4. Acquisitive Prescription (b) 30 years if extraordinary.
(a) Concept and requisites (OCENPO) Good Faith + Title Movable Immovable
 Prescription is a mode of acquiring ownership and other real rights Ordinary requires possession of 4 years 10 years
through the lapse of time in the manner and under conditions things in good faith and
laid down by law, namely, that the possession should be in the with just title.
concept of an owner, public, peaceful, uninterrupted, and Extraordinary does not require just 8 years 30 years
adverse. (Heirs of Bienvenido and Araceli Tayag v. Gabriel) title and good faith
 OCEN Possession + Occupation
o Possession is open when it is patent, visible, apparent, (d) When prescription does not lie
notorious, and not clandestine. (Director of Lands v. IAC)
o It is continuous when uninterrupted, unbroken, and not (1) In case of registered land
intermittent or occasional; o GR: Prescription does not run against registered land.
o exclusive when the adverse possessor can show exclusive o Thus, under Sec. 47 PD 1529 (Property Registration Decree),
dominion over the land and an appropriation of it to his own it is specifically provided that "no title to registered land in
use and benefit; and derogation of that of the registered owner shall be acquired by
o notorious when it is so conspicuous that it is generally known prescription or adverse possession.” (Heirs of Leopoldo
and talked of by the public or the people in the neighborhood. Vencilao, Sr. v. CA; Pangasinan v. Disonglo-Almazora; Lausa
v. Quilaton)
(Republic v. northern Cement; Heirs of Tayag; Heirs of Marcelina o EXC: However, in Heirs of Anacleto B. Nieto v. Municipality of
Arzadon-Crisologo v. Ranon; Pelbel Manufacturing Corp. v. CA) Meycattayan, Bulacan, SC recognized the jurisprudential
thread that while a Torrens title is indefeasible and
(b) Two kinds of acquisitive prescription imprescriptible, the registered landowner may lose his
ARTICLE 1117, NCC. Acquisitive prescription of dominion and other right to recover possession of his registered property by
real rights may be ordinary or extraordinary. reason of laches.
Ordinary acquisitive prescription requires possession of things in (2) In case of property of public dominion
good faith and with just title for the time fixed by law. ARTICLE 1113, NCC. All things which are within the commerce of
men are susceptible of prescription, unless otherwise provided.
ARTICLE 1131, NCC. For the purposes of prescription, just title must Property of the State or any of its subdivisions not patrimonial in
be proved; it is never presumed. character shall not be the object of prescription.
ARTICLE 1137, NCC. Ownership and other real rights over  GR: It is clear that property of public dominion, which generally
immovables also prescribe through uninterrupted adverse includes property belonging to the State, cannot be the object of
possession thereof for thirty years, without need of title or of good prescription or, indeed, be subject of the commerce of man. (Heirs
faith. of Malabanan v. Republic)
 EXC: However, where lands of the public domain are patrimonial
(1) Ordinary - requires possession of things in good faith and with just in character, they are susceptible to acquisitive prescription,
title for the time fixed by law. For purposes of prescription, the law pursuant to Article 1113 NCC. (Buan Vda de Esconde v. CA)
requires that just title must be proved; it is never presumed.
(2) Extraordinary - does not require just title and good faith. (3) In case of trust
 A trustee cannot acquire by prescription the ownership of property
(c) Period of prescription entrusted to him. (Buan Vda. De Esconde)
ARTICLE 1132, NCC. The ownership of movables prescribes  That rule applies squarely to express trusts.
through uninterrupted possession for four years in good faith. o The basis of the rule is that the possession of a trustee is
not adverse. Not being adverse, he does not acquire by
The ownership of personal property also prescribes through prescription the property held in trust.
uninterrupted possession for eight years, without need of any other o The rule of imprescriptibility of the action to recover property
condition. held in trust may possibly apply to resulting trusts as long as
the trustee has not repudiated the trust.
With regard to the right of the owner to recover personal property lost  EXC: Acquisitive prescription may bar the action of the
or of which he has been illegally deprived, as well as with respect to beneficiary against the trustee in an express trust for the
movables acquired in a public sale, fair, or market, or from a recovery of the property held in trust where:
merchant's store the provisions of articles 559 and 1505 of this Code (a) the trustee has performed unequivocal acts of
shall be observed. repudiation amounting to an ouster of the cestui que trust;
(b) such positive acts of repudiation have been made known swarm becomes res mdlius and ownership thereof may now be
to the cestui que trust; and acquired by the owner of the estate by way of occupation.
(c) the evidence thereon is clear and conclusive.
(d) Wild and domesticated or tamed animals
(4) In case of following relationships Rule as to wild animals
ARTICLE 1109, NCC. Prescription does not run between husband  Those which are found in their state of natural freedom. They are
and wife, even though there be a separation of property agreed upon without an owner or res nullius. Hence, ownership thereof may
in the marriage settlements or by judicial decree. be acquired by occupation.
 However, once they recover their natural freedom or once they are
Neither does prescription run between parents and children, during restored to their original state of being free, they cease to be under
the minority or insanity of the latter, and between guardian and ward one’s possession and will again become res nullius.
during the continuance of the guardianship.
Rule as to domesticated or tamed animals
 husband and wife, even though there is a separation of ARTICLE 560, NCC. Wild animals are possessed only while they are
property in the marriage settlements or by judicial decree. under one’s control; domesticated or tamed animals are considered
 parents and children, during the minority or insanity of the latter domestic or tame, if they retain the habit of returning to the premises
 guardian and ward during the continuance of the guardianship. of the possessor.
5. Occupation  Those which were formerly wild but have been subdued and
retained the habit of returning to the premises of the
(a) Concept and requisites possessor.
Concept  So long as they retain the habit of returning to the premises of
It is a mode of acquiring ownership by the seizure or apprehension of the possessor, the ownership over these animals is not affected by
things corporeal which have no owner with the intention of acquiring the simple fact that they are no longer under the control of the
them and according to the rules laid down by law. present possessor-owner.
 The possessor-owner of domesticated animals has a period of 20
Requisites days counted from the occupation by another person within
(1) the thing must be res nullius—that is. a thing which either never which to reclaim them.
had an owner, or which, by virtue of a previous abandonment  If after the expiration of this period the possessor-owner fails to
(dereliction), has not an owner at the time of its occupation; reclaim them, the ownership over these animals is considered to
(2) it must be appropriable by nature or one that can be seized or have been abandoned and the animals become res nullius.
apprehended (or it must be corporeal);
(3) it must be brought into the actual possession or control of the (e) Hidden treasure
one professing to acquire it; and ARTICLE 439, NCC. By treasure is understood, for legal purposes,
(4) the person must acquire it with the intention of acquiring any hidden and unknown deposit of money, jewelry, or other precious
ownership. He must therefore have the necessary capacity to objects, the lawful ownership of which does not appear.
consent.
ARTICLE 438, NCC. Hidden treasure belongs to the owner of the
(b) Hunting or fishing land, building, or other property on which it is found.
ARTICLE 715, NCC. The right to hunt and to fish is regulated by
special laws. Nevertheless, when the discovery is made on the property of another,
or of the State or any of its subdivisions, and by chance, one-half
RA 9147. X thereof shall be allowed to the finder. If the finder is a trespasser, he
shall not be entitled to any share of the treasure.
 The right to hunt and to fish is regulated by special laws.
 This mode does not apply to animals classified as rare, If the things found be of interest to science or the arts, the State may
threatened, or endangered species. acquire them at their just price, which shall be divided in conformity
with the rule stated.
(c) Swarm of bees
ARTICLE 716, NCC. The owner of a swarm of bees shall have a right  A hidden treasure is any hidden and unknown deposit of money,
to pursue them to another’s land, indemnifying the possessor of the jewelry, or other precious objects, the lawful ownership of which
latter for the damage. If the owner has not pursued the swarm, or does not appear.
ceases to do so within two consecutive days, the possessor of the  It is considered, in law, as res nullius and may thus be acquired
land may occupy or retain the same. The owner of domesticated by occupation.
animals may also claim them within twenty days to be counted from o The treasure belongs wholly to the finder if found upon
their occupation by another person. This period having expired, they one own’s ground;
shall pertain to him who has caught and kept them. o if found or discovered by chance in another’s property and
the finder is not a trespasser, the treasure is equally divided
 The owner of a swarm of bees has a right to pursue them to between the finder and the owner of the ground.
another’s land, with the obligation of indemnifying the possessor
of the latter for the damage. (f) Abandoned and lost movable
 In case the owner of the swarm of bees fails to pursue the
swarm, or if he initially makes a pursuit but he ceases to do so (1) Abandoned movable
within 2 consecutive days, the law considers him as to have  The property is considered abandoned if
abandoned ownership of the swarm of bees, in which case, the
o the spes recuperandi (hope of recovery or recapture) is gone (3) The painter, sculptor, or other artist, with respect to the product
and of his art;
o the animus revertendi (intent to recover) is given up. (US v. (4) The scientist or technologist or any other person with regard to
Rey) his discovery or invention.
 It becomes res nullius and may be acquired by occupation.
ARTICLE 722, NCC. The author and the composer, mentioned in
(2) Lost movable Nos. 1 and 2 of the preceding article, shall have the ownership of
ARTICLE 719, NCC. Whoever finds a movable, which is not their creations even before the publication of the same. Once their
treasure, must return it to its previous possessor. If the latter is works are published, their rights are governed by the Copyright laws.
unknown, the finder shall immediately deposit it with the mayor of the
city or municipality where the finding has taken place. The painter, sculptor or other artist shall have dominion over the
product of his art even before it is copyrighted.
The finding shall be publicly announced by the mayor for two
consecutive weeks in the way he deems best. The scientist or technologist has the ownership of his discovery or
invention even before it is patented.
If the movable cannot be kept without deterioration, or without
expenses which considerably diminish its value, it shall be sold at ARTICLE 723, NCC. X Letters and other private communications in
public auction eight days after the publication. writing are owned by the person to whom they are addressed and
delivered, but they cannot be published or disseminated without the
Six months from the publication having elapsed without the owner consent of the writer or his heirs. However, the court may authorize
having appeared, the thing found, or its value, shall be awarded to their publication or dissemination if the public good or the interest of
the finder. The finder and the owner shall be obliged, as the case justice so requires.
may be, to reimburse the expenses.
Sec. 178.6, RA 8293. X
ARTICLE 720, NCC. If the owner should appear in time, he shall be
obliged to pay, as a reward to the finder, one-tenth of the sum or of  The author, the composer, the painter, the sculptor, or other artists,
the price of the thing found. the scientists, and the inventors acquire ownership over their
works from the moment of their creation even before the same
 Where the property is not abandoned but it is now under the control are published, copyrighted, or patented.
of another person.  Being the owner thereof, the creator has absolute control over
o The finder, far from becoming owner of the thing found, is his work and he may do anything with it as he pleases, including
bound the right to share it with others.
 to return it to its previous owner, if known, or o He also enjoys the exclusive right to its publication—but
 to immediately deposit the same with the mayor of the this exclusive right is limited only to the first publication.
city or municipality where the finding has taken place, if (Santos v. McCullough Printing Co.; Filipino Society of
the owner is unknown. Composers v. Tan)
o If the finder fails to comply with these procedural  Unless placed under the protection of the Intellectual Property
requirements and appropriates for himself the movable Law, once published, the work is dedicated to the public, and
property he found, he shall be liable for the crime of theft. the author loses the exclusive right to control subsequent
(Art. 308(1) RPC) publications by others.
 If the lost property is turned over to the mayor, the latter is then
required to make a public announcement of such finding for 2 Intellectual Property Law v. Intellectual Creation
consecutive weeks in a manner he deems best.  Creator has the right of exclusive enjoyment over his work until
o If after 6 months, the owner does not appear, the thing found, FIRST PUBLICATION.
or its value, shall be awarded to the finder, with the  Under IP Law, subsequent publications are also protected.
obligation to reimburse the expenses in the publication. o Mr. Sosito: automatic copyright na daw. Registration is only
 It is only after compliance with the foregoing rules that the finder for recording purposes.
shall acquire ownership of the thing found by occupation. o See: PD 49 s. 1972
o If the owner appears on time, he shall be obliged, however, to
pay, as a reward to the finder, 1/10 of the sum or of the price (c) Ownership over letters
of the thing found. (1) Ownership over material or physical object (the letter itself) - it
is owned by the person to whom it is addressed and delivered;
6. Intellectual Creation (2) Ideas or contents - it is owned by the author or writer (the sender).
 As a consequence, while the recipient may have the control and
(a) Concept possession of the physical letter itself by virtue of his ownership of
Intellectual property refers to creations of the mind: inventions, literary the same, the author’s consent is required in case of publication or
and artistic works, and symbols, names, images, and designs used in dissemination of the letter.
commerce.  In addition, the copyright also belongs to the author or writer
(the sender). (Sec. 178.6)
(b) Time of acquisition of ownership
ARTICLE 721, NCC. By intellectual creation, the following persons LL. Donation
acquire ownership:
(1) The author with regard to his literary, dramatic, historical, legal, 1. Concept and Requisites
philosophical, scientific or other work;
(2) The composer; as to his musical composition; (a) Definition
ARTICLE 725, NCC. Donation is an act of liberality whereby a person testator’s name written by some other person in his presence, and by
disposes gratuitously of a thing or right in favor of another, who his express direction, and attested and subscribed by three or more
accepts it. credible witnesses in the presence of the testator and of one another.
 It is an act of liberality whereby a person disposes gratuitously The testator or the person requested by him to write his name and
of a thing or right in favor of another, who accepts it. the instrumental witnesses of the will, shall also sign, as aforesaid,
 It may also be defined as “a gratuitous contract whereby the donor each and every page thereof, except the last, on the left margin, and
divests himself, at present and irrevocably, of the thing given in all the pages shall be numbered correlatively in letters placed on the
favor of the donee. (Concurring: J. Antonio, Alejandro v. Geraldez) upper part of each page.
(b) Requisites The attestation shall state the number of pages used upon which the
(1) essential reduction of the patrimony of the donor; will is written, and the fact that the testator signed the will and every
(2) increase in the patrimony of the donee; and page thereof, or caused some other person to write his name, under
(3) intent to do an act of liberality or animus donandi. his express direction, in the presence of the instrumental witnesses,
(Heirs of Rosendo Sevilla Florencio v. Heirs of Teresa Sevilla de Leon) and that the latter witnessed and signed the will and all the pages
thereof in the presence of the testator and of one another. mtimuw
 Donative intent is presumed present when one gives a part of
one’s patrimony to another without consideration, and it is not If the attestation clause is in a language not known to the witnesses,
negated when the person donating has other intentions, motives, it shall be interpreted to them.
or purposes which do not contradict donative intent. (Abello v. CIR)
o For a donation to exist, however, the intent to donate must ARTICLE 806, NCC. Every will must be acknowledged before a
be effectively carried out. notary public by the testator and the witnesses. The notary public
 Hence, a mere declaration of an intention or desire to donate is not shall not be required to retain a copy of the will, or file another with
a donation. (Jutic v. CA; Aldaba v. CA) the office of the Clerk of Court.
(c) Donation is a mode of acquisition  It partakes of the nature of a testamentary provision.

ARTICLE 712, NCC. Ownership is acquired by occupation and by  As such, the same must be executed in accordance with the
intellectual creation. requisites on solemnities of wills and testaments under Articles 805
and 806 NCC; otherwise, the donation is void and would produce
Ownership and other real rights over property are acquired and no effect.
transmitted by law, by donation, by testate and intestate succession, o Unless and until the donation is probated, i.e., proved and
and in consequence of certain contracts, by tradition. allowed in the proper court, no right to the subject property
has been transmitted to the donee. (Bascara v. Javier)
They may also be acquired by means of prescription.
Characteristics
 CC treats donation as a contract that transfers ownership. (1) Conveys no title or ownership to the transferee before the
 As explained in Liguez v. Lopez, donation does not need to be death of the transferor or what amounts to the same thing, that the
completed by tradition since Article 712 prescribes that ownership transferor should retain the ownership (full or naked) and control of
and rights therein are acquired and transmitted by donation, the property while alive;
succession—and in consequence of certain contracts— by (2) Before his death, the transfer should also be revocable by the
tradition, thereby implying that donation is not one of the contracts transferor at will, adnutuum; but revocability may be provided for
requiring tradition. indirectly by means of a reserved power in the donor to dispose of
the properties conveyed; and
2. Classification of Donation (3) The transfer is void if the transferor should survive the
transferee. (Villanueva v. Branoco; Del Rosario v. Ferrer;
(a) As to time of effectivity Ganuelas v. Cawed; Bonsato v. CA; Alejandro v. Geraldez)
(1) Donation inter vivos – When the donation takes effect during the
donor’s lifetime or independently of the donor’s death or when the Determination of nature of donation
full or naked ownership (nuda proprietas) of the donated properties  Crucial in determining whether the donation is inter vivos or mortis
passes to the donee during the donor’s lifetime, not by reason of causa is the determination of whether the donor intended to
his death but because of the deed of donation. (Alejandro v. transfer ownership over the properties upon the execution of
Geraldez) the deed. (Reyes v. Mosqueda)
(2) Donation mortis causa – When the donation takes effect only  If the donor intends to transfer the ownership of the property
upon the donor’s death or when the full or naked ownership of the donated upon the execution of the donation, as reflected from the
donated properties will pass to the donee only because of the provisions contained in the donation, then it is inter vivos;
donor’s death. otherwise, it is merely mortis causa, or made to take effect after
death. (Castro v. CA)
(b) Donation mortis causa
Concept (c) Classification of donation inter vivos
It is in reality a devise, if it involves real property; or a legacy, if it ARTICLE 725, NCC. Donation is an act of liberality whereby a person
involves personal property. disposes gratuitously of a thing or right in favor of another, who
accepts it.
Formalities
ARTICLE 805, NCC. Every will, other than a holographic will, must ARTICLE 726, NCC. When a person gives to another a thing or right
be subscribed at the end thereof by the testator himself or by the on account of the latter's merits or of the services rendered by him to
the donor, provided they do not constitute a demandable debt, or obligation which depends upon them. If the obligation is divisible, that
when the gift imposes upon the donee a burden which is less than part thereof which is not affected by the impossible or unlawful
the value of the thing given, there is also a donation. condition shall be valid.
ARTICLE 733, NCC. Donations with an onerous cause shall be The condition not to do an impossible thing shall be considered as
governed by the rules on contracts and remuneratory donations by not having been agreed upon.
the provisions of the present Title as regards that portion which
exceeds the value of the burden imposed. (1) Simple and remuneratory donations — both are true donations
because the underlying consideration is the pure liberality of the
(1) pure or simple donation – Where the underlying cause is plain donor; hence, they are both governed by the law on donations, as
gratuity or pure liberality (no strings attached) (Republic v. Silim, follows:
Lagazo v. CA) (a) as to formalities, both shall be governed by Articles 748 and
(2) remuneratory or compensatory donation – made for the 749;
purpose of rewarding the donee for past services, which services (b) as to effect of impossible condition, the condition is simply
do not amount to a demandable debt (Lagazo) considered not imposed and the donation remains valid (Art.
(3) conditional or modal donation – where the donation is made in 727).
consideration of future services or where the donor imposes certain (2) Onerous donations - it is completely governed not by the law on
conditions, limitations, or charges upon the donee, the value of donations but by the law on contracts, as follows:
which is inferior than that of the donation given; and (a) as to formalities, it is obligatory in whatever form it may have
(4) onerous donation – been entered into (Art. 1356);
o that which imposes upon the donee a reciprocal obligation or, (b) as to effect of impossible condition, the donation becomes
to be more precise, this is the kind of donation made for a void (Art. 1183).
valuable consideration, the cost of which is equal to or more (3) Conditional or modal donations - the rules of contract govern
than the thing donated. the onerous portion of donation; the rules of donation only apply
o Of all the foregoing classifications, donations of the onerous to the excess, if any. (Calanasan v. Dolorito)
type are the most distinct. This is because, unlike the other
forms of donation, the validity of and the rights and obligations 3. Perfection, Capacity of Parties, and Formalities
of the parties involved in an onerous donation is completely
governed not by the law on donations but by the law on (a) Effects of perfection
contracts. (1) the donee becomes the absolute owner of the property donated;
(Del Rosario v. Ferrer) and
(d) Governing law of donation inter vivos (2) it is generally considered irrevocable. (Vda.de Arceo v. CA)
ARTICLE 748, NCC. The donation of a movable may be made orally
or in writing. (b) When acceptance must be made
ARTICLE 1323, NCC. An offer becomes ineffective upon the death,
An oral donation requires the simultaneous delivery of the thing or of civil interdiction, insanity, or insolvency of either party before
the document representing the right donated. acceptance is conveyed.
If the value of the personal property donated exceeds five thousand The acceptance must be made during the lifetime of the donor.
pesos, the donation and the acceptance shall be made in writing. Upon the death of either the donor or the donee prior to the perfection
Otherwise, the donation shall be void. of the donation, the offer of donation becomes ineffective.
ARTICLE 749, NCC. In order that the donation of an immovable may Will there be transmission of ownership even without actual delivery?
be valid, it must be made in a public document, specifying therein the YES, as long as the donation is perfected
property donated and the value of the charges which the donee must
satisfy. (c) Capacity of donor
The acceptance may be made in the same deed of donation or in a Requisites

separate public document, but it shall not take effect unless it is done ARTICLE 735, NCC. All persons who may contract and dispose of
during the lifetime of the donor. their property may make a donation.
If the acceptance is made in a separate instrument, the donor shall ARTICLE 739, NCC. The following donations shall be void:
be notified thereof in an authentic form, and this step shall be noted (1) Those made between persons who were guilty of adultery or
in both instruments. concubinage at the time of the donation;
(2) Those made between persons found guilty of the same criminal
ARTICLE 727, NCC. Illegal or impossible conditions in simple and offense, in consideration thereof;
remuneratory donations shall be considered as not imposed. (3) Those made to a public officer or his wife, descendants and
ascendants, by reason of his office.
ARTICLE 733, NCC. Donations with an onerous cause shall be
governed by the rules on contracts and remuneratory donations by In the case referred to in No. 1, the action for declaration of nullity
the provisions of the present Title as regards that portion which may be brought by the spouse of the donor or donee; and the guilt of
exceeds the value of the burden imposed. the donor and donee may be proved by preponderance of evidence
in the same action.
ARTICLE 1183, NCC. Impossible conditions, those contrary to good
customs or public policy and those prohibited by law shall annul the
ARTICLE 87, FC. Every donation or grant of gratuitous advantage, (5) Any physician, surgeon, nurse, health officer or druggist who
direct or indirect, between the spouses during the marriage shall be took care of the testator during his last illness;
void, except moderate gifts which the spouses may give each other (6) Individuals, associations and corporations not permitted by law
on the occasion of any family rejoicing. The prohibition shall also to inherit.
apply to persons living together as husband and wife without a valid
marriage. ARTICLE 87, FC. Every donation or grant of gratuitous advantage,
direct or indirect, between the spouses during the marriage shall be
(1) he must be in possession of the capacity to contract; void, except moderate gifts which the spouses may give each other
(2) he must have the capacity to dispose of his property; and on the occasion of any family rejoicing. The prohibition shall also
(3) he must not be specifically prohibited to make a donation. apply to persons living together as husband and wife without a valid
marriage.
Cannot donate future property
 Donations cannot comprehend future property. (1) Mere juridical capacity is sufficient.
 The law requires that the donor be the owner of the property (2) Prohibited donations:
donated at the time of the donation; otherwise, such donation is (a) donations between those who were guilty of adultery or
void, even if accepted, following the rule that “no one can give what concubinage at the time of the donation;
he does not have”—nemo dat quod non habet. (b) donations between those who were found guilty of the
same criminal offense, if the donation is made in
Reckoning period of donor’s capacity consideration thereof;
ARTICLE 737, NCC. The donor’s capacity shall be determined as of (c) those made to public officers or their spouses, descendants,
the time of the making of the donation. and ascendants, if the donation is made by reason of their
office;
The donor’s capacity shall be determined as of the time of the making of (d) donations made to those who are incapacitated to succeed
the donation. by will; (1027 [1, 2, 3, 5, 6] in relation to 740)
(e) donations between the spouses during the marriage, whether
Double donation the donation be made directly or indirectly, except moderate
Not legally possible in this jurisdiction because donation is a mode of ones given on the occasion of any family rejoicing; and
acquiring ownership. (Separate Concurring: J. Vitug, Hemedes v. CA) (f) donations between those who are living together as
husband and wife without a valid marriage, whether the
(d) Capacity of donee donation be made directly or indirectly.
ARTICLE 739, NCC. The following donations shall be void: In the first, no previous criminal conviction is necessary since the guilt of
(1) Those made between persons who were guilty of adultery or the donor and the donee may be proved by preponderance of evidence
concubinage at the time of the donation; in a civil action for declaration of nullity of the donation; while in the
(2) Those made between persons found guilty of the same criminal second, a previous criminal conviction is necessary,
offense, in consideration thereof;
(3) Those made to a public officer or his wife, descendants and (e) Formalities in donations of personal property
ascendants, by reason of his office. ARTICLE 748, NCC. The donation of a movable may be made orally
or in writing.
In the case referred to in No. 1, the action for declaration of nullity
may be brought by the spouse of the donor or donee; and the guilt of An oral donation requires the simultaneous delivery of the thing or of
the donor and donee may be proved by preponderance of evidence the document representing the right donated.
in the same action.
If the value of the personal property donated exceeds five thousand
ARTICLE 740, NCC. Incapacity to succeed by will shall be applicable pesos, the donation and the acceptance shall be made in writing.
to donations inter vivos. Otherwise, the donation shall be void.
ARTICLE 1027, NCC. The following are incapable of succeeding:  If the value of the donated property does not exceed P5.000, there
(1) The priest who heard the confession of the testator during his is no required form.
last illness, or the minister of the gospel who extended spiritual  If the donation is made orally, there must be simultaneous
aid to him during the same period; delivery of the thing or of the document representing the right
(2) The relatives of such priest or minister of the gospel within the donated; otherwise, the donation is void.
fourth degree, the church, order, chapter, community,  If the value of the donated property exceeds P5,000, both the
organization, or institution to which such priest or minister may donation and the acceptance must be in writing; otherwise, the
belong; donation shall be void.
(3) A guardian with respect to testamentary dispositions given by a
ward in his favor before the final accounts of the guardianship (f) Formalities in donations of real property
have been approved, even if the testator should die after the ARTICLE 749, NCC. In order that the donation of an immovable may
approval thereof; nevertheless, any provision made by the ward be valid, it must be made in a public document, specifying therein the
in favor of the guardian when the latter is his ascendant, property donated and the value of the charges which the donee must
descendant, brother, sister, or spouse, shall be valid; satisfy.
(4) Any attesting witness to the execution of a will, the spouse,
parents, or children, or any one claiming under such witness, The acceptance may be made in the same deed of donation or in a
spouse, parents, or children; separate public document, but it shall not take effect unless it is done
during the lifetime of the donor.
(1) The donor cannot give by donation more than what he can give by
If the acceptance is made in a separate instrument, the donor shall will, or it must not impair the legitimes of his compulsory heirs.
be notified thereof in an authentic form, and this step shall be noted (a) If he does, so much of what is donated as exceeds what
in both instruments. he can give by will is deemed “inofficious” and the
donation is reducible to the extent of such excess, though
 Regardless of its value, the donation and the acceptance of the without prejudice to its taking effect in the donor’s lifetime or
same should be in a public instrument; otherwise, the donation the donee’s appropriating the fruits of the thing donated. (Vda.
is void. De Tupas v. Br. XLIII, RTC of Negros Occidental)
 The acceptance may be made in the same deed of donation or (2) He must reserve, either in full ownership or in usufruct, sufficient
in a separate instrument. If the acceptance is in a separate public means for the support of himself and all relatives who, at the
instrument, the donor shall be notified in writing of such fact. Both time of the acceptance, are by law entitled to be supported by the
instruments must state the fact of such notification. donor, otherwise, the donation is subject to a corresponding
reduction at the instance of “any person affected" and only to the
There are, therefore, 3 requisites for the validity of a simple donation extent necessary for the support of the donor and his relatives
of a real property, to wit: entitled to be supported by him.
(1) it must be made in a public instrument;
(2) it must be accepted, which acceptance may be made either in the (b) Generally irrevocable
same Deed of Donation or in a separate public instrument; and ARTICLE 760, NCC. Every donation inter vivos, made by a person
(3) if the acceptance is made in a separate instrument, the donor having no children or descendants, legitimate or legitimated by
must be notified in an authentic form, and the same must be noted subsequent marriage, or illegitimate, may be revoked or reduced as
in both instruments. provided in the next article, by the happening of any of these events:
(Arangote v. Maglunob) (1) If the donor, after the donation, should have legitimate or
legitimated or illegitimate children, even though they be
 The purpose of the formal requirement for acceptance of a donation posthumous;
is to ensure that such acceptance is duly communicated to the (2) If the child of the donor, whom the latter believed to be dead
donor. (Homeowners Association of Talayan Village, Inc. v. JM when he made the donation, should turn out to be living;
Tuason & Co., Inc) (3) If the donor should subsequently adopt a minor child.
o Hence, even if the requirements of notification and notation
are not complied with in cases where the acceptance is made ARTICLE 764, NCC. The donation shall be revoked at the instance
on a separate instrument, the donation remains valid if the of the donor, when the donee fails to comply with any of the
donor is nonetheless aware of the acceptance (Pajarillo v. conditions which the former imposed upon the latter.
IAC) or the donor had actual knowledge of the same.’”
o On the other hand, in the absence of evidence that the In this case, the property donated shall be returned to the donor, the
claimed donation had been accepted, the requirements of alienations made by the donee and the mortgages imposed thereon
notice and notation should be strictly applied. (Legasto v. by him being void, with the limitations established, with regard to third
Versoza; Santos v. Robledo) persons, by the Mortgage Law and the Land Registration laws.
 It is enough, between the parties to a donation of an immovable
property, that the donation be made in a public instrument but, in This action shall prescribe after four years from the noncompliance
order to bind third persons, the donation must be registered with the condition, may be transmitted to the heirs of the donor, and
in the Registry of Property. (Shopper’s Paradise Realty & may be exercised against the donee’s heirs.
Development Corp. v. Roque)
 However, such registration in the Office of the Register of Deeds or ARTICLE 765, NCC. The donation may also be revoked at the
in the Assessor’s Office is not necessary for the donation to be instance of the donor, by reason of ingratitude in the following
considered valid and official. (Heirs of Rosendo Sevilla Florencio v. cases:
Heirs of Teresa Sevilla de Leon) (1) If the donee should commit some offense against the person,
the honor or the property of the donor, or of his wife or children
4. Reduction and Revocation under his parental authority;
(2) If the donee imputes to the donor any criminal offense, or any
(a) Extent of donation act involving moral turpitude, even though he should prove it,
A donation is subject to the following limitations: unless the crime or the act has been committed against the
ARTICLE 752, NCC. The provisions of article 750 notwithstanding, donee himself, his wife or children under his authority;
no person may give or receive, by way of donation, more than he (3) If he unduly refuses him support when the donee is legally or
may give or receive by will. morally bound to give support to the donor.
The donation shall be inofficious in all that it may exceed this ARTICLE 752, NCC. The provisions of article 750 notwithstanding,
limitation. no person may give or receive, by way of donation, more than he
may give or receive by will.
ARTICLE 750, NCC. The donation may comprehend all the present
property of the donor, or part thereof, provided he reserves, in full The donation shall be inofficious in all that it may exceed this
ownership or in usufruct, sufficient means for the support of himself, limitation.
and of all relatives who, at the time of the acceptance of the donation,
are by law entitled to be supported by the donor. Without such GR: once the donation is accepted (or perfected), it is generally
reservation, the donation shall be reduced in petition of any person considered irrevocable. (Gestopa v. CA)
affected. EXC: A donation inter vivos may be revoked only on grounds allowed by
law, as follows:
(1) subsequent appearance of a child
(2) nonfulfillment of charges imposed in the donation (c) If the donee unduly refuses to give support to the donor
(3) ingratitude of the donee; and when the former is legally or morally bound to give support to
(4) the fact that the donation is inofficious. the latter.
(2) Prescriptive period: One year, counted from the time the donor
(c) Subsequent appearance of child had knowledge of the fact and it was possible for him to bring the
action. (769)
Requisites
(1) when the donor made the donation, he had no child; and (e) Inofficious donations
(2) after the donation, he had a child, whether legitimate, illegitimate or Concept
adopted, or the child whom he believed to be dead turned out to be A donation is inofficious if
alive. (760)  it exceeds what the donor may give by will, or
 when it prejudices the legitimes of the donor’s compulsory heirs.
Extent of reduction or revocation
The provisional legitime of the child should be computed at the time of Extent of reduction or revocation
the child’s appearance and the donation should be correspondingly In determining whether the donation is inofficious or not, recourse must
reduced or revoked to the extent that the provisional legitime of the child, be had to the rules established by the Civil Code for the determination
at that time, has been impaired. of the legitime and, by extension, of the disposable portion, taking into
consideration the estimated net value of the donor’s property at the time
Q. What if when the child appeared, the donation was not reduced or of his death. (Vda. De Tupas v. Br. XLIII, RTC)
revoked. If the decedent died poorer than at the time of the appearance
of the child, can we still reduce or revoke that donation? Who may revoke?
ARTICLE 772, NCC. Only those who at the time of the donor’s death
(3) Prescriptive period have a right to the legitime and their heirs and successors in interest
ARTICLE 763, NCC. The action for revocation or reduction on the may ask for the reduction or inofficious donations.
grounds set forth in article 760 shall prescribe after four years from
the birth of the first child, or from his legitimation, recognition or Those referred to in the preceding paragraph cannot renounce their
adoption, or from the judicial declaration of filiation, or from the time right during the lifetime of the donor, either by express declaration, or
information was received regarding the existence of the child by consenting to the donation.
believed dead.
The donees, devisees and legatees, who are not entitled to the
This action cannot be renounced, and is transmitted, upon the death legitime and the creditors of the deceased can neither ask for the
of the donor, to his legitimate and illegitimate children and reduction nor avail themselves thereof.
descendants.
Only those who at the time of the donor’s death have a right to the
The action for reduction or revocation is subject to a 4-year prescriptive legitime and their heirs and successors-in-interest may ask for the
period from the time of the appearance of the child. reduction of inofficious donations.
(d) Acts of ingratitude Prescriptive period

ARTICLE 765, NCC. The donation may also be revoked at the ARTICLE 1144, NCC. The following actions must be brought within
instance of the donor, by reason of ingratitude in the following cases: ten years from the time the right of action accrues:
(1) If the donee should commit some offense against the person, (1) Upon a written contract;
the honor or the property of the donor, or of his wife or children (2) Upon an obligation created by law;
under his parental authority; (3) Upon a judgment.
(2) If the donee imputes to the donor any criminal offense, or any
act involving moral turpitude, even though he should prove it, The action for reduction or revocation of an inofficious donation
unless the crime or the act has been committed against the prescribes in 10 years following Article 1144 NCC. (Imperial v. CA;
donee himself, his wife or children under his authority; Santos v. Alana)
(3) If he unduly refuses him support when the donee is legally or
morally bound to give support to the donor. (f) failure to comply with conditions
ARTICLE 769, NCC. The action granted to the donor by reason of Meaning of condition
ingratitude cannot be renounced in advance. This action prescribes ARTICLE 764, NCC. The donation shall be revoked at the instance
within one year, to be counted from the time the donor had of the donor, when the donee fails to comply with any of the
knowledge of the fact and it was possible for him to bring the action. conditions which the former imposed upon the latter.
(1) Instances of acts of ingratitude In this case, the property donated shall be returned to the donor, the
(a) If the donee should commit some offense against the alienations made by the donee and the mortgages imposed thereon
person, the honor or the property of the donor, or of his by him being void, with the limitations established, with regard to third
wife or children under his parental authority; persons, by the Mortgage Law and the Land Registration laws.
(b) If the donee imputes to the donor any criminal offense, or
any act involving moral turpitude, even though he should This action shall prescribe after four years from the noncompliance
prove it, unless the crime or the act has been committed with the condition, may be transmitted to the heirs of the donor, and
against the donee himself, his wife or children under his may be exercised against the donee’s heirs.
authority; or
 According to the Court, the condition referred to in Article 764
refers to obligations or charges imposed by the donor on the
donee, (Dissent: J. Davide, Central PH University v. CA) making

the donation onerous. (De Luna v. Abrigo)
o Not to any future or uncertain event
o Being an onerous donation, it will be governed on the law on
contracts. 764 will not apply on 764 (LOL). 1144 will apply.
o Sir: Parang may mali sa interpretation ng SC.
 Revoked
Prescriptive period
If onerous – 10 years counted from the time within which the donee
must comply with the conditions/obligations of the donation. Thus, the
laws on contract apply.
If not onerous –the period is 4 years.
When to count 10-vear period

ARTICLE 1197, NCC. If the obligation does not fix a period, but from
its nature and the circumstances it can be inferred that a period
was intended, the courts may fix the duration thereof.
The courts shall also fix the duration of the period when it depends
upon the will of the debtor.
In every case, the courts shall determine such period as may under
the circumstances have been probably contemplated by the parties.
Once fixed by the courts, the period cannot be changed by them.
 The accrual of the cause of action is from the expiration of the

time within which the donee must comply with the conditions or
obligations of the donation. (Sec. of Education v. Heirs of Rufino
Dulay, Sr.)
 Where the donee is burdened with the obligation to utilize the land
donated for school purposes, the Court ruled that from the nature
and circumstances of the condition of the subject donation, a period
is contemplated by the donors, except that if no period was fixed in
the donation, resort to Article 1197 NCC is necessary.
 However, resort to Article 1197 will no longer be applicable if
more than a reasonable period has already been allowed to the
donee to avail of the opportunity to comply with the condition,
even if it be burdensome, to make the donation in its favor forever
valid, but the donee still failed to do so. (Central PH University v.
CA)
When donation provides for automatic revocation

 A donation that provides for automatic revocation in case of
failure to comply with the condition imposed is valid. (De Luna
v. Abrigo)
 A judicial finding that the revocation is proper is only necessary
when the other party actually goes to court for the specific purpose
of challenging the propriety of the revocation.
BOOK III: SUCCESSION

For the reduction of donations the provisions of this Chapter and of
A. Basic Principles articles 911 and 912 of this Code shall govern.
1. Basic Concepts ARTICLE 935. The legacy of a credit against a third person or of
the remission or release of a debt of the legatee shall be effective
ARTICLE 774. Succession is a mode of acquisition by virtue of only as regards that part of the credit or debt existing at the time of
which the property, rights and obligations to the extent of the value the death of the testator.
of the inheritance, of a person are transmitted through his death to
another or others either by his will or by operation of law. (n) In the first case, the estate shall comply with the legacy by assigning
to the legatee all rights of action it may have against the debtor. In
(a) Definition of succession the second case, by giving the legatee an acquittance, should he
Succession is a mode of acquisition by virtue of which the property, request one.
rights, and obligations to the extent of the value of the inheritance
of a person are transmitted through his death to another or others In both cases, the legacy shall comprise all interests on the credit
either by his will or by operation of law. or debt which may be due the testator at the time of his death.
(b) Elements ARTICLE 948. If the legacy or devise is of a specific and determinate
thing pertaining to the testator, the legatee or devisee acquires the
(1) causal element, which is the death of the decedent; ownership thereof upon the death of the testator, as well as any
(2) objective element, which is the inheritance; growing fruits, or unborn offspring of animals, or uncollected income;
(3) subjective element - the decedent and those who are called to but not the income which was due and unpaid before the latter’s
succeed him, either by the decedent’s express will or by provision death.
of law; and
(4) acceptance of the inheritance by the person called to the From the moment of the testator’s death, the thing bequeathed
succession, shall be at the risk of the legatee or devisee, who shall, therefore,
bear its loss or deterioration, and shall be benefited by its increase or
(c) Causal element - death: improvement, without prejudice to the responsibility of the executor
or administrator.
Importance of death
ARTICLE 777. The rights to the succession are transmitted from the (1) The inheritance vests immediately upon the decedent’s death
moment of the death of the decedent. without a moment’s interruption. (Hacbang v. Alo)
(a) Ownership over the inheritance passes to the heirs at the
 The rights to the succession are transmitted from the moment precise moment of death—not at the time the heirs are
of the death of the decedent. declared, nor at the time of the partition, nor at the distribution
Treyes vs. Larlar case: No need for further proceeding to
 The moment of death is the determining point when an heir of the properties. enforce rights by virtue of succession
acquires a definite right to the inheritance. (Edades v, Edades) (b) There is no interruption between the end of the decedent’s
ownership and the start of the heir/ legatee/devisee’s
Consequences ownership.
ARTICLE 1034. In order to judge the capacity of the heir, devisee (2) At that precise time, the heir is already legally deemed to have
or legatee, his qualification at the time of the death of the acquired ownership of his/her share in the inheritance, and not at
decedent shall be the criterion. the time of declaration of heirs, or partition, or distribution. Thus,
there is no legal bar to an heir disposing of his/her hereditary
In cases falling under Nos. 2, 3, or 5 of article 1032, it shall be share immediately after such death. (Salitico v. Heirs of Felic)
necessary to wait until final judgment is rendered, and in the case (3) The right of the State to collect the inheritance tax (or estate
falling under No. 4, the expiration of the month allowed for the tax) accrues at the moment of death, notwithstanding the
report. postponement of the actual possession and enjoyment of the
estate by the heir, and the tax is based on the value of the property
If the institution, devise or legacy should be conditional, the time of at that time, regardless of any subsequent appreciation or
the compliance with the condition shall also be considered. depreciation. (Lorenzo v. Posadas)
(4) The capacity of the heir is determined as of the time the
ARTICLE 908. To determine the legitime, the value of the property decedent died (Art. 1034);
left at the death of the testator shall be considered, deducting all (a) the legitime is to be computed as of the same moment (Art.
debts and charges, which shall not include those imposed in the will. 908), and so is the inofficiousness of the donation inter vivos
(Art. 771).
To the net value of the hereditary estate, shall be added the value of (b) Similarly, the legacies of credit and remission are valid only in
all donations by the testator that are subject to collation, at the time the amount due and outstanding at the death of the testator
he made them. (Art. 935), and the fruits accruing after that instant are deemed
to pertain to the legatee (Art. 948). (Butte v. Manuel Uy and
ARTICLE 771. Donations which in accordance with the provisions of Sons, Inc.)
article 752, are inofficious, bearing in mind the estimated net value of
the donor’s property at the time of his death, shall be reduced with Interest before death
regard to the excess; but this reduction shall not prevent the ARTICLE 1347. All things which are not outside the commerce of
donations from taking effect during the life of the donor, nor shall it men, including future things, may be the object of a contract. All rights
bar the donee from appropriating the fruits. which are not intransmissible may also be the object of contracts.
No contract may be entered into upon future inheritance except in ARTICLE 776. The inheritance includes all the property, rights and
cases expressly authorized by law. obligations of a person which are not extinguished by his death.
All services which are not contrary to law, morals, good customs, (PRO)
public order or public policy may likewise be the object of a contract.  The inheritance includes all the property, rights, and
obligations of a person which are not extinguished by his death.
 Prior to the death of the decedent, the right of the heirs to his  Succession is the mode of transmitting the inheritance by reason
properties is but a mere expectancy, or merely inchoate. (JLT of death; while inheritance is what is transmitted upon death.
Agro, Inc. v. Balansag)
 Article 1347, paragraph 2 NCC characterizes a contract entered As to properties
into upon future inheritance as void. (Arrogante v. Deliarte) Only those still existing and owned by the decedent shall be
included in the inheritance.
Contract upon Future Inheritance
A contract may be classified as a contract upon future inheritance, Rights and obligations
prohibited under the second paragraph of Article 1347, where the ARTICLE 1311. Contracts take effect only between the parties,
following requisites concur: their assigns and heirs, except in case where the rights and
(1) that the succession has not yet been opened; obligations arising from the contract are not transmissible by their
(2) that the object of the contract forms part of the inheritance; and nature, or by stipulation or by provision of law. The heir is not
(3) that the promisor has, with respect to the object, an expectancy of liable beyond the value of the property he received from the
a right which is purely hereditary in nature. decedent.
(Ferrer v. Diaz)
If a contract should contain some stipulation in favor of a third person,
Kind of death contemplated he may demand its fulfillment provided he communicated his
For purposes of opening one’s succession, the death may either be acceptance to the obligor before its revocation. A mere incidental
natural (physical) demise or presumptive death. benefit or interest of a person is not sufficient. The contracting parties
 In case of presumptive death for purposes of opening the must have clearly and deliberately conferred a favor upon a third
succession, a judicial declaration is not required and courts are person.
without authority to issue the same. (Tadeo-Matias v. Republic,
2018) (1) purely personal rights are not transmissible to the heirs, hence,
not part of the inheritance;
For purposes of opening one’s succession, death may be (2) patrimonial rights are generally included
presumed in the following situations: (a) except as otherwise provided by law or by the will of the
testator, such as usufruct and personal servitudes; and
ARTICLE 390, NCC. X (3) rights and obligations arising from contracts are generally
transmissible to the heirs unless they are not transmissible
ARTICLE 391, NCC. X (a) by reason of their nature,
(b) by express agreement of the parties, or
(1) Ordinary Absence (c) by express provision of law.
(a) GR: If a person has been absent, it being unknown whether
or not he still lives, he shall be presumed dead after an Monetary obligations
absence of 10 years.  It is the estate or the mass of property, rights and assets left by the
(b) EXC: If he disappeared after the age of 75 years, an decedent, instead of the heirs directly, that becomes vested and
absence of five years shall be sufficient. charged with the payment of the money debts of the decedent.
(c) DOD: Death is presumed to have taken place on the last day (Limjoco v. Intestate Estate of Pedro Fragrante)
of the period of absence required by law.  It is only what is left of the estate after the payment of debts that
(2) Qualified Absence - A person is presumed dead for all purposes, are transmitted to the heirs. Hence, monetary obligations of the
including the division of the estate among the heirs under the decedent are not included in the inheritance.
following situations:
(a) a person onboard a vessel lost during a sea voyage, or an (e) Subjective element
airplane which is missing, who has not been heard of for four
years since the loss of the vessel or airplane; ARTICLE 775. In this Title, “decedent” is the general term applied to
(b) a person in the armed forces who has taken part in war, and the person whose property is transmitted through succession,
has been missing for four years; and whether or not he left a will. If he left a will, he is also called the
(c) a person who has been in danger of death under other testator.
circumstances and his existence has not been known for
four years. ARTICLE 782. An heir is a person called to the succession either
by the provision of a will or by operation of law.
In these cases, the presumptive death is fixed on the very day of the
occurrence of the event from which death is presumed; and if such Devisees and legatees are persons to whom gifts of real and
date cannot be fixed, the court determines the middle of the period in personal property are respectively given by virtue of a will.
which the event could have happened.
ARTICLE 874. An absolute condition not to contract a first or
(d) Objective element – inheritance subsequent marriage shall be considered as not written unless
such condition has been imposed on the widow or widower by
Concept:
the deceased spouse, or by the latter’s ascendants or ARTICLE 960. Legal or intestate succession takes place:
descendants. (1) If a person dies without a will, or with a void will, or one which
has subsequently lost its validity;
Nevertheless, the right of usufruct, or an allowance or some personal (2) When the will does not institute an heir to, or dispose of all
prestation may be devised or bequeathed to any person for the time the property belonging to the testator. In such case, legal
during which he or she should remain unmarried or in succession shall take place only with respect to the property of
widowhood. which the testator has not disposed;
(3) If the suspensive condition attached to the institution of
(1) Decedent/Testator: heir does not happen or is not fulfilled, or if the heir dies
(a) The person whose property is transmitted through succession before the testator, or repudiates the inheritance, there being
is called “decedent” whether or not he left a will. no substitution, and no right of accretion takes place;
(b) If he left a will, he is also called the “testator.” (4) When the heir instituted is incapable of succeeding, except in
(2) Successors: The successors of the decedent in succession are cases provided in this Code.
called heirs, devisees, or legatees.
(3) Heirs and kinds: Those who are called upon to succeed by (1) Testamentary succession - results from the designation of an
universal title on the whole estate or to an aliquot portion heir, made in a will executed in the form prescribed by law;
thereof, either by will or by operation of law, are called “heirs.” In (2) Legal or intestate succession - that which takes place if a person
turn, there are three kinds of heirs: (a) dies without a will, or
(a) voluntary heirs, or those called upon to succeed only by (b) with a void will, or
express will of the testator to the portion of the estate which (c) one which has subsequently lost its validity; (Heirs of
the testator can freely dispose of; Ignacio Conti v. CA)
(b) compulsory heirs, or those called upon to succeed by (3) Mixed succession - effected partly by will and partly by operation
operation of law to a portion of the estate known as the of law, and it may take place in the following scenarios:
“legitime,” of which they cannot be deprived by the testator (a) if the testator did not dispose of the entire estate, that part
except by way of a valid disinheritance; and which is not disposed of in the will shall be distributed following
(c) legal or intestate heirs, or those called upon to succeed by the rules of intestate succession;
operation of law in case the decedent dies without a valid (b) in case there is preterition where the institution of heirs is
will, or to some portion of the estate not disposed of by annulled in its entirety but there are devises and legacies,
will. the portion of the estate that would have been given to the
(4) Devisees and legatees: instituted heirs shall be distributed instead in accordance with
(a) A devisee is a person to whom a gift of particular real property the rules of intestate succession; and
is given by virtue of a will (c) in case a portion of the estate becomes vacant and
(b) A legatee is a person to whom a gift of particular personal substitution, accretion, or representation cannot take place;
property is given by virtue of a will. (4) Compulsory succession - takes place compulsorily by operation
(5) Distinctions between voluntary heir and devisee/legatee of law with respect to the legitime in favor of compulsory heirs.
Voluntary Heir Devisee / Legatee 3. Laws Governing Succession

succeeds to the whole estate or given individualized items of
to an aliquot portion thereof property
 at the precise moment of  D/L bequeathed specific
death, VH become properties do not require
absolute owners of their court adjudication to
undivided aliquot share identify which particular
 with respect to the properties become theirs
individual properties of and title over these
the estate, they become particular properties
co-owners and do not vests on the legatee or
know which properties will devisee from the very (a) National law of decedent
be adjudicated to them yet moment of the testator’s ARTICLE 16, para. 2, NCC. X
until partition and death; (Hacbang v. Alo)
distribution ARTICLE 1039. Capacity to succeed is governed by the law of the
in case of preterition of a the devises and legacies shall nation of the decedent.
compulsory heir in the direct line, remain valid insofar as the
the institution of VH shall be legitimes are not impaired Article 16, par. 2 and Article 1039 CC render applicable the national law
annulled in its entirety of the decedent, in intestate or testamentary successions, with regard to
the following aspects:
2. Kinds of Succession (1) the order of succession;
(2) the amount of successional rights;
ARTICLE 779. Testamentary succession is that which results from (3) the intrinsic validity of the provisions of the will; and
the designation of an heir, made in a will executed in the form (4) the capacity to succeed. (Bellis v. Bellis)
prescribed by law.
 Anchenta v. Guersey-Dalaygon: SC ruled that being a foreign
ARTICLE 780. Mixed succession is that effected partly by will and national, the intrinsic validity of Audrey O’Neill’s will, especially with
partly by operation of law. regard as to who are her heirs, is governed by her national law, i.e.,
the law of the State of Maryland, as provided in Article 16 CC.
 Bellis v. Bellis: Philippine law on legitime does not apply if the o The will of an incapable shall not be validated by the
decedent is a foreigner because the issues of the intrinsic validity supervening capacity brought about by changes in the law.
of the provisions of his will and the amount of successional rights
should be governed by the decedent’s national law. B. Wills in General
o If the issue involves any of the items mentioned above, the
applicable law is the law in force at the time of the decedent’s 1. Concept
death, in the event that the law has been changed.
o This is because the moment of death is the determining point Definition
when an heir acquires a definite right to the inheritance, ARTICLE 783. A will is an act whereby a person is permitted, with
(Edades) hence, any change in the law with regard to who are the formalities prescribed by law, to control to a certain degree the
the heirs, the amount of successional rights, the intrinsic disposition of his estate, to take effect after his death.
validity of the testamentary provisions, and capacity to
succeed shall not result in the impairment of any right.  A will is an act whereby a person is permitted, with the formalities
prescribed by law, to control to a certain degree the disposition of
(b) Forms and solemnities of wills this estate, to take effect after his death.
o It is "a personal, solemn, revocable and free act by which a
ARTICLE 17, para. 1, NCC. X capacitated person disposes of his property and rights and
declares or complies with duties to take effect after his death.”
ARTICLE 815. When a Filipino is in a foreign country, he is (Vitug v. CA)
authorized to make a will in any of the forms established by the
law of the country in which he may be. Such will may be probated Requirement of disposition of estate
in the Philippines.  It is not the essence of a will.
o Valino v. Adriano: Before the “expressed wishes of the
ARTICLE 818. Two or more persons cannot make a will jointly, deceased” may govern the matter of his funeral pursuant to
or in the same instrument, either for their reciprocal benefit or for the Article 307 CC, any inferences as to such wishes should be
benefit of a third person. established by some form of testamentary disposition.
 If the will disposes of the estate, the conduct of probate
ARTICLE 819. Wills, prohibited by the preceding article, executed by becomes mandatory because Article 838 CC provides
Filipinos in a foreign country shall not be valid in the Philippines, that "no will shall pass either real or personal property
even though authorized by the laws of the country where they may unless it is proved and allowed in accordance with the
have been executed. Rules of Court.”
 Hence, a will which does not contain any disposition
ARTICLE 795. The validity of a will as to its form depends upon the of property does not have to be probated.
observance of the law in force at the time it is made. o Seangio v. Reyes: An instrument which only provides for
the disinheritance of a compulsory heir should be
probated because the disinheritance is an act of disposition
 GR: The forms and solemnities of wills shall be governed by the
in itself since it results in the disposition of the testator’s
laws of the country in which they are executed.
property in favor of those who would succeed in the absence
o When a Filipino is in a foreign country, he is authorized to
make a will in any of the forms established by the law of the of the disinherited heir.
country in which he may be. Such will may be probated in the
Philippines. 2. Characteristics of Wills
 EXC
ARTICLE 819. Wills, prohibited by the preceding article, executed by
o Joint wills executed by Filipinos in a foreign country shall not
Filipinos in a foreign country shall not be valid in the Philippines,
be valid in the Philippines, even though authorized by the laws
even though authorized by the laws of the country where they may
of the country where they may have been executed.
have been executed.
o If the law governing forms and solemnities has been changed,
the applicable law shall be the law in force at the time of
the execution of the will. ARTICLE 832. A revocation made in a subsequent will shall take
effect, even if the new will should become inoperative by reason of
(c) Testamentary capacity the incapacity of the heirs, devisees or legatees designated therein,
ARTICLE 15, NCC. X or by their renunciation.
ARTICLE 801. Supervening incapacity does not invalidate an ARTICLE 839. The will shall be disallowed in any of the following
effective will, nor is the will of an incapable validated by the cases:
supervening of capacity. (1) If the formalities required by law have not been complied
with;
(2) If the testator was insane, or otherwise mentally incapable of
 It is the national law of the person concerned that governs on
making a will, at the time of its execution;
the matter of legal capacity, including the issue of testamentary
(3) If it was executed through force or under duress, or the
capacity.
influence of fear, or threats;
 Additionally, it is the law in force at the time of the execution of
(4) If it was procured by undue and improper pressure and
the will that determines whether or not the testator has the
influence, on the part of the beneficiary or of some other
requisite testamentary capacity.
person;
o If he has the requisite testamentary capacity at that time, any
(5) If the signature of the testator was procured by fraud;
supervening incapacity brought about by changes in the law
does not invalidate an effective will.
(6) If the testator acted by mistake or did not intend that the ARTICLE 788. If a testamentary disposition admits of different
instrument he signed should be his will at the time of affixing interpretations, in case of doubt, that interpretation by which the
his signature thereto. disposition is to be operative shall be preferred.
ARTICLE 784. The making of a will is a strictly personal act; it ARTICLE 789. When there is an imperfect description, or when no
cannot be left in whole or in part to the discretion of a third person, or person or property exactly answers the description, mistakes
accomplished through the instrumentality of an agent or attorney. and omissions must be corrected, if the error appears from the
context of the will or from extrinsic evidence, excluding the oral
ARTICLE 875. Any disposition made upon the condition that the heir declarations of the testator as to his intention; and when an
shall make some provision in his will in favor of the testator or uncertainty arises upon the face of the will, as to the application
of any other person shall be void. of any of its provisions, the testator’s intention is to be ascertained
from the words of the will, taking into consideration the
ARTICLE 787. The testator may not make a testamentary disposition circumstances under which it was made, excluding such oral
in such manner that another person has to determine whether or declarations.
not it is to be operative.
ARTICLE 791, NCC. The words of a will are to receive an
ARTICLE 786. The testator may entrust to a third person the interpretation which will give to every expression some effect, rather
distribution of specific property or sums of money that he may than one which will render any of the expressions inoperative; and of
leave in general to specified classes or causes, and also the two modes of interpreting a will, that is to be preferred which will
designation of the persons, institutions or establishments to which prevent intestacy.
such property or sums are to be given or applied.
ARTICLE 793, NCC. Property acquired after the making of a will shall
(1) It is an act mortis causa – meaning, it takes effect only upon the only pass thereby, as if the testator had possessed it at the time of
death of the testator; making the will, should it expressly appear by the will that such was
(2) it is essentially revocable – a will is essentially ambulatory; and at his intention.
any time prior to the testator’s death, it may be changed or revoked
because it is not yet effective during the testator’s lifetime; (Caniza ARTICLE 794, NCC. Every devise or legacy shall convey all the
v. CA) interest which the testator could devise or bequeath in the property
(3) it is an individual act – because PH laws do not allow Filipino disposed of, unless it clearly appears from the will that he intended
citizens to make a joint will regardless of the place of its execution; to convey a less interest.
(4) it is a unilateral act – because a will takes effect upon the death of
the testator even if the testamentary dispositions become ARTICLE 929, NCC. If the testator, heir, or legatee owns only a part
inoperative by reason of the renunciation of the heirs, devisees, or of, or an interest in the thing bequeathed, the legacy or devise shall
legatees designated therein; be understood limited to such part or interest, unless the testator
(5) it is a free act; otherwise, the will is void; expressly declares that he gives the thing in its entirety.
(6) it is a free or solemn act – because Philippine laws provide for
certain formalities that must be followed in the execution of wills; ARTICLE 930, NCC. The legacy or devise of a thing belonging to
(Lee v. Tambago) another person is void, if the testator erroneously believed that the
(7) the right is purely statutory – the right to dispose of property by thing pertained to him. But if the thing bequeathed, though not
will is not natural but statutory; (Herreros v. Gil) and belonging to the testator when he made the will, afterwards becomes
(8) it is strictly a personal act – it cannot be left in whole or in part to his, by whatever title, the disposition shall take effect.
the discretion of a third person, or accomplished through the
instrumentality of an agent or attorney, referring to the decisions or (1) The intent or the will of the testator is the supreme law in
wishes contained therein. succession. Hence, testate succession has always been
preferred over intestacy. (Hacbang v. Alo)
Corollary to this rule, the testator cannot leave to the discretion of a (a) Consequently, upon the discovery and probate of the
third person the following: decedent's will, the letters of administration shall be revoked
(1) the duration or efficacy of the designation of HDLs; and the intestate proceedings shall be suspended. (Sec. 1,
(2) the determination of the portions which they are to take, when Rule 82)
referred to by name; and (b) Additionally, an interpretation that will render a testamentary
(3) the determination of whether or not a testamentary disposition disposition operative takes precedence over a construction
is to be operative. that will nullify a provision of the will. (Balanay, Jr. v. Martinez,
citing 788, 791)
EXC: The testator may entrust to a third person the implementation of (2) If there is an ambiguity, whether patent or latent, the same may
the details of a testamentary disposition where the former left a specific be resolved by determining the intention of the testator by
property or sums of money to a specified class or cause, provided that examining the words of the will and/or resorting to parol or extrinsic
the following requisites are complied with: evidence, but excluding the oral declarations of the testator as to
(1) the testator was the one who specified the class or cause who his intention.
will be the recipient of the property; and (a) Patent: if it appears upon the face of the instrument;
(2) the testator has already specified in the will the property or the (b) Latent: it cannot be seen from a mere perusal of the will but
amount of money to be given to said class or cause." appears only upon consideration of extrinsic circumstances.
(3) Properties acquired during the interval between the execution
3. Important Rules of Interpretation of the will and the death of the testator are not, as a rule,
included among the properties disposed of (793) unless it
should expressly appear in the will itself that such was the
intention of the testator, such as when the will covers or speaks (b) nor is the state of being forgetful, provided that he has the
of the “whole estate” or the “entire inheritance.” ability to know the three things mentioned above. (Baltazar v.
(4) Every devise or legacy shall cover all the interest which the testator Laxa; Sancho v. Abella)
could devise or bequeath in the property disposed of, unless it
clearly appears from the will that the testator intended to convey a Presumption of soundness of mind
less interests ARTICLE 800. The law presumes that every person is of sound
(5) If the testator, heir or legatee owns only a part of, or an interest mind, in the absence of proof to the contrary.
in the thing bequeathed, the legacy or devise shall be understood
limited to such part or interest, unless the testator expressly The burden of proof that the testator was not of sound mind at the
declares that he gives the thing in its entirety. time of making his dispositions is on the person who opposes the
(a) When he expressly states that he bequeaths the entire probate of the will; but if the testator, one month, or less, before
property, it must appear that he does so with knowledge that making his will was publicly known to be insane, the person who
the thing partly belongs to another; otherwise, the legacy or maintains the validity of the will must prove that the testator made it
devise is void under Article 930 of the NCC. during a lucid interval.
4. Testamentary Capacity and Witnesses There is a presumption in favor of soundness of mind, unless one month
or less before the execution of the will, the testator was publicly known
(a) Who are capacitated to be insane.
ARTICLE 796. All persons who are not expressly prohibited by (c) Qualifications of witnesses:
law may make a will.
ARTICLE 810. A person may execute a holographic will which must
ARTICLE 797. Persons of either sex under eighteen years of age be entirely written, dated, and signed by the hand of the testator
cannot make a will. himself. It is subject to no other form, and may be made in or out of
the Philippines, and need not be witnessed.
ARTICLE 798. In order to make a will it is essential that the testator
be of sound mind at the time of its execution. ARTICLE 805. Every will, other than a holographic will, must be
subscribed at the end thereof by the testator himself or by the
As a rule, all natural persons are qualified to make a will unless testator’s name written by some other person in his presence, and by
(1) he is expressly prohibited by law; his express direction, and attested and subscribed by three or
(2) he is below 18 years of age at the time of its execution or more credible witnesses in the presence of the testator and of one
(3) he is of unsound mind at the time of its execution. another.
If the testator has no testamentary capacity, the will is void. The testator or the person requested by him to write his name and
the instrumental witnesses of the will, shall also sign, as aforesaid,
(b) Soundness of mind each and every page thereof, except the last, on the left margin, and
all the pages shall be numbered correlatively in letters placed
Reckoning point on the upper part of each page.
ARTICLE 801. Supervening incapacity does not invalidate an
effective will, nor is the will of an incapable validated by the The attestation shall state the number of pages used upon which
supervening of capacity. the will is written, and the fact that the testator signed the will
and every page thereof, or caused some other person to write his
ARTICLE 799, para 1. To be of sound mind, it is not necessary that name, under his express direction, in the presence of the
the testator be in full possession of all his reasoning faculties, or that instrumental witnesses, and that the latter witnessed and signed
his mind be wholly unbroken, unimpaired, or unshattered by disease, the will and all the pages thereof in the presence of the testator
injury or other cause. and of one another.
It shall be sufficient if the testator was able at the time of making the If the attestation clause is in a language not known to the witnesses,
will to know the nature of the estate to be disposed of, the proper it shall be interpreted to them.
objects of his bounty, and the character of the testamentary act.
ARTICLE 820. Any person of sound mind and of the age of
 The test of testamentary capacity is at the time of the making of eighteen years or more, and not blind, deaf or dumb, and able to
the will. (Alsua-Betts v. CA) read and write, may be a witness to the execution of a will mentioned
 Supervening incapacity does not invalidate an effective will. (801) in article 805 of this Code.
Test of soundness of mind ARTICLE 821. The following are disqualified from being witnesses
The three things that the testator must have the ability to know to be to a will:
considered of sound mind are as follows: (1) Any person not domiciled in the Philippines;
(1) the nature of the estate to be disposed of, - properties (2) Those who have been convicted of falsification of a
(2) the proper objects of the testator’s bounty, and – heirs document, perjury or false testimony.
(3) the character of the testamentary act. (Ortega v. Valmonte, citing
799 para. 2) – effects of disposition ARTICLE 823. If a person attests the execution of a will, to whom or
(a) Hence, mere weakness of mind or partial imbecility from to whose spouse, or parent, or child, a devise or legacy is given by
disease of body or from age does not render a person such will, such devise or legacy shall, so far only as concerns such
incapable of making a will; (Alsua-Betters) person, or spouse, or parent, or child of such person, or any one
claiming under such person or spouse, or parent, or child, be void,

unless there are three other competent witnesses to such will. 1. Kinds of Wills
However, such person so attesting shall be admitted as a
witness as if such devise or legacy had not been made or given. Two kinds of wills
Under the Civil Code, there are two kinds of wills which a testator may
ARTICLE 1027, NCC. The following are incapable of succeeding: execute. (Caneda v. CA)
(1) The priest who heard the confession of the testator during his (1) Ordinary or attested/notarial will:
last illness, or the minister of the gospel who extended spiritual (a) The first kind is the “ordinary or attested will,” the execution of
aid to him during the same period; which is governed by Articles 804 to 809 CC.
(2) The relatives of such priest or minister of the gospel within (b) The ordinary will must be acknowledged before a notary
the fourth degree, the church, order, chapter, community, public by a testator and the attesting witnesses. Hence, it is
organization, or institution to which such priest or minister may likewise known as a “notarial will.
belong; (2) Holographic will
(3) A guardian with respect to testamentary dispositions given by (a) Article 810 CC defines as one that is entirely written, dated,
a ward in his favor before the final accounts of the guardianship and signed by the testator himself.
have been approved, even if the testator should die after the (b) This kind of will, unlike the ordinary type, requires no
approval thereof; nevertheless, any provision made by the ward attestation by witnesses.
in favor of the guardian when the latter is his ascendant, (c) Hence, if the will is not entirely written in the testator’s own
descendant, brother, sister, or spouse, shall be valid; handwriting the same must comply with the formalities
(4) Any attesting witness to the execution of a will, the spouse, required of an ordinary will to be valid.
parents, or children, or any one claiming under such witness,
spouse, parents, or children; Common formal requirements
(5) Any physician, surgeon, nurse, health officer or druggist Both wills are required to be:
who took care of the testator during his last illness; (1) in writing, except that a holographic will is required to be written
(6) Individuals, associations and corporations not permitted by entirely in the testator’s own handwriting; and
law to inherit. (2) it must be executed in a language or dialect known to the
testator. If the will is executed in a language or dialect not known
ARTICLE 824. A mere charge on the estate of the testator for the to the testator, the will is void (Suroza v. Honrado) and cannot be
payment of debts due at the time of the testator’s death does not probated. (Acop v. Piraso)
prevent his creditors from being competent witnesses to his will.
 There is no statutory' requirement to state in the will itself that the
 A holographic will need not be witnessed. (810) testator knew the language or dialect used in the will. (Testate
o Hence, the requirement of witnesses applies only to ordinary Estate of the Late Alipio Abada v. Abaja; Testate Estate of
wills. An ordinary will is required to be attested and subscribed Javellana v. Javellana)
by at least three witnesses. (805) o This is a matter that a party may establish by proof aliunde.
 The requirement as to the number of witnesses is mandatory. But there must be proof of compliance with such requirement
o If less than three witnesses attested and subscribed to an and the burden of proof is incumbent upon those who
ordinary will, the same is void.” presented the will for probate. (Estate of Javellana)
o In some cases, this lack of evidence was considered cured by
Not qualified to become a witness to an ordinary will: presumption of knowledge of the language or dialect used in
(1) a person below 18 years of age; the will, as where the will was executed in a certain province
(2) a person who is of unsound mind; or locality in the dialect currently used in such province or
(3) a blind person; locality, in which the testator was a native or resident, the
(4) a deaf or dumb; presumption arises that the testator knew the dialect so used,
(5) an illiterate, or unable to read and write; (820) in the absence of evidence to the contrary. (Abangan v.
(6) those convicted of falsification of a document, perjury, or false Abangan; Gonzales v. Laurel)
testimony; (821[2]) and o Reyes v. Zuniga vda. De Vidal: where the will was in
(7) those not domiciled in the Philippines, (821[1]) if the will is executed Spanish, the fact that the testatrix was a “mestizo espaflola,"
here in the Philippines. was married to a Spaniard, made several trips to Spain, and
(a) If the will is executed abroad, the testator is allowed to follow some of her letters in her own handwriting submitted as
the formalities of the place of execution. evidence by the oppositor were in Spanish, gave rise to the
(b) Hence, it is the law of the place of execution that will apply in presumption that she knew the language in which the will was
determining the necessity of witnesses and their written, in the absence of proof to the contrary.
qualifications.
2. Additional Formalities in Ordinary Wills
 If a person is made a beneficiary in the will (either as an heir,
legatee, or devisee), or his spouse, parent, or child, such person ARTICLE 805. Every will, other than a holographic will, must be
does not become disqualified to become a witness (823) but the subscribed at the end thereof by the testator himself or by the
HDL becomes incapacitated to inherit from the testator, (1027[4], testator’s name written by some other person in his presence, and by
823) unless there are 3 other competent witnesses to such will. his express direction, and attested and subscribed by three or
o However, a mere charge on the estate of the testator for the more credible witnesses in the presence of the testator and of one
payment of debts due at the time of the testator’s death does another.
not prevent his creditors from being competent witnesses to
his will. The testator or the person requested by him to write his name and
the instrumental witnesses of the will, shall also sign, as aforesaid,
C. Kinds and Formalities of Wills each and every page thereof, except the last, on the left margin, and
all the pages shall be numbered correlatively in letters placed  The requirement is satisfied not only by the customary written
on the upper part of each page. signature but by a thumbprint or thumbmark or other mark affixed
by him. (Matias v. Salud; De Gala v. Gonzales and Ona; Dolar v.
The attestation shall state the number of pages used upon which Diancin; Payad v. Tolentino; Neyra v. Neyra; Lopez v. Liboro)
the will is written, and the fact that the testator signed the will  It is a matter of taste or preference since both ways are good.
and every page thereof, or caused some other person to write his (Lopez v. Liboro)
name, under his express direction, in the presence of the o However, a cross written after the testator’s name is not a
instrumental witnesses, and that the latter witnessed and signed sufficient signature, unless it has been proven that it was the
the will and all the pages thereof in the presence of the testator testator’s habitual signature or there was an explanation given
and of one another. why he used a cross when he knew how to sign. (Garcia v.
Lacuesta; Matias v. Salud)
If the attestation clause is in a language not known to the witnesses, o The mere sign of the cross could not be likened to a
it shall be interpreted to them. thumbmark as it does not have the trustworthiness of the
latter.
ARTICLE 806. Every will must be acknowledged before a notary
public by the testator and the witnesses. The notary public shall not If he signed thru another
be required to retain a copy of the will, or file another with the office (a) Requisites
of the Clerk of Court. (1) the testator’s name is written by some other person in his presence
and by his express (not necessarily written) direction;
(1) it must be subscribed at the end thereof, (2) such person signed the will and every page thereof in the presence
(a) by the testator himself or of the testator and the instrumental witnesses;
(b) by the testator’s name written by some other person in his (3) the person requested by the testator signs the testator’s name, not
presence, and by his express direction; his (Ex Parte Santiago; Balonan v. Abellana; otherwise, the will
(2) it must be attested and subscribed by at least three credible cannot be allowed; (Barut v. Cabacungan) and
witnesses in the presence of the testator and of one another; (4) the fact that the testator caused some other person to write his
(3) the testator or the person requested by him to write his name must name in his presence and by his express direction and also in the
also sign every page, except the last, on the left margin in the presence of the instrumental witnesses is stated in the attestation
presence of the witnesses; clause.
(4) the witnesses must sign every page on the left margin in the
presence of the testator and of one another; If any of the foregoing requirements is not complied with, the will is void.
(5) all pages must be numbered correlatively in letters on the
upper part of each page; (b) Where to write testator’s name
(6) it must contain an attestation clause which expressly states the  The third person must write the testator’s name at the end of the
following: will (In Re Will of Siason)
(a) the number of pages used upon which the will is written; o not merely in the body of the attestation clause. (Guison v.
(b) the fact that the testator signed the will and every page Concepcion)
thereof, or caused some other person to write his name, under
his express direction, in the presence of the instrumental (c) Who may sign
witnesses; It is immaterial who writes the name of the testator, even one of the
(c) the fact that the witnesses witnessed and signed the will subscribing or attesting witnesses may sign for the testator. (Abaya v.
and all the pages thereof in the presence of the testator and Zalamero)
of one another; and
(7) it must be acknowledged before a notary public by the testator and 4. Will Must be Attested and Subscribed by Three Witnesses
the witnesses.
Distinction between attestation and subscription:
3. Requirement of Signature by Testator Attestation Subscription
consists in witnessing the Subscription is the signing of the
Where to sign testator’s execution of the will in witnesses’ names upon the
 He must sign all pages containing testamentary dispositions on order to see and take note same paper for the purpose of
the left-hand margin; but on the last page, he must sign at the end mentally that those things are identification of such paper as
of the will. done which the statute requires the will which was executed by
 The end of the will is after the last testamentary disposition for the execution of a will and the testator.
(called the “logical end”). that the signature of the testator
o If signed at this portion, the will is valid because the non- exists as a fact.
dispositive portions are not “essential” parts of the will. (Mitra Act of the senses Act of the hand
v. Sablan-Guevarra) Mental Mechanical
o Where the signature is followed by dispositive [Taboada v. Rosal; Caneda v. CA]
provisions, even the portion of the instrument preceding the
signature cannot be probated, because the instrument must If last page also contains attestation clause
be considered as a whole. (Tolentino)  If the last page (or end of the will) also contains the attestation
clause and it is signed by the witnesses only on the left-hand
Two ways of signing margin, the will is void because an unsigned attestation clause
He may sign it personally or he may cause another person to write his results in an unattested will.
name in his presence and by his express direction, o The signatures of the witnesses on the left-hand margin only
satisfy the requirement of subscription but not the requirement
If he signed personally
of attestation. Hence, the will is void. (Azuela v. CA; Cagro v.  But where one subscribing witness was in the outer room at the
Cagro) time when the testator and the other subscribing witnesses
 If the witnesses signed the attestation clause itself but not the attached their signatures to the instrument in the inner room, the
left-hand margin of the page containing such clause, the will is still will was considered not signed in each other’s presence. (Nera)
valid because both the requirements of attestation and
subscription are satisfied. 6. All Pages Must Be Numbered Correlatively
Number of witnesses mandatory Mandatory requirement

 The requirement as to the number of instrumental witnesses is  All pages of the will shall be numbered correlatively. (805)
mandatory.  Purpose: to guard against fraud, and to afford means of
o If less than 3 witnesses attested and subscribed, the will is preventing the substitution or of defecting the loss of any of its
void. (Lee v. Tambago; Aluad v. Aluad) pages. (Lopez v. Liboro)
 If a witness, or his/her spouse, parent, or child, has been made a o Considering the purpose of the requirement, even if one of the
devisee or a legatee in the will to which he/she acts as a witness, pages was not numbered but the authenticity thereof and the
he/she does not thereby become disqualified as a witness but the genuineness of the signatures of the testator and the
legacy or devise is void, unless there are three other witnesses to witnesses thereon are not questioned, the will is still valid.
such will. (823)
o On the other hand, the requirement of three witnesses is not How pages must be numbered
satisfied if one of the three witnesses also acted as the  The law requires that the pages be numbered in letters, such as
notary public himself before whom the will was supposed to “one,” “two,” “three,” etc.
have been acknowledged because the effect thereof is that  However, the requirement of the law is complied with
there is only two attesting witnesses to the will. (Cruz v. o if the folios were paged with the letters “A,” “B,” “C,” etc.,
Villasor) (Aldaba Roque) or
o in Arabic numerals, (Unson v. Abella) or
5. Signature of Testator and Witnesses on All Pages in Each o in any form of identification. (Lopez v. Liboro)
Other’s Presence
Place of page number
Signing of all pages  The law requires that the page number be placed on the upper
 The testator or the person requested by him to write his name must part of each page.
sign every page on the left margin, except the last page which is  However, the location of the page number is not important.
required to be signed at the end, in the presence of the witnesses. o If the paging should be placed in the lower part, the
(805) testament is not void for this sole reason. (Unson v. Abella)
 The witnesses must also sign every page on the left margin in
the presence of the testator and of one another. 7. Requirement of Attestation Clause
o The failure of all three witnesses to sign the left margin of
every page, even when the testator’s signature appears Effect of absence
thereon, is a fatal defect. (Aspe v. Prieto)  The complete absence of attestation clause would result in the
 The law refers expressly to “page” and not to sheet, leaf or folio. invalidity of the will. (Caneda v. CA)
o A sheet has 2 pages, the front and the reverse.  An unsigned attestation clause results in an unattested will.
o If both pages of the sheet or leaf contain testamentary
dispositions, it is necessary that both front and reverse sides Concept
should bear the signatures of the testator and of each of the An attestation clause refers to that part of an ordinary will whereby the
witnesses; otherwise, the will is void. (In Re Estate of attesting witnesses certify that the instrument has been executed
Saguinsin; Vda. De Enriquez v. Abadia) before them and that compliance with the essential formalities
required by law has been observed. (Vda de Ramos v. CA)
Signing on left margin is directory
 The location of the marginal signatures is not mandatory in Act of witnesses
character, provided, of course, that such signatures are present in  Since it is a declaration made by the witnesses and not by the
every page of the will. (Abangan v. Abangan; Avera v. Garcia; testator, it need be signed only by the witnesses and not by the
Nayve v. Mojal; Antonio v. Antonio) testator. (Abangan)
 In requiring such signature, the law has for its object to avoid the  However, an attestation clause that is made by the testator himself
substitution of any of said sheets, changing the testator’s substantially complies with the requirements of the law where it
disposition. Hence, the purpose of the law is satisfied regardless of contains all the facts required to be stated therein and signed by all
the location of the marginal signatures. the witnesses together with the testator. (Cuevas v. Achacoso;
Gonzales v. Carungcong)
Signing in each other’s presence
 The true test of “presence of the testator and the witnesses” in the Contents of attestation clause
execution of a will is not whether they actually saw each other sign, (1) the number of the pages used upon which the will is written;
but whether they might have been seen each other sign, had (2) that the testator signed, or expressly caused another to sign, the
they chosen to do so, by merely casting his eyes in the proper will and every page thereof in the presence of the attesting
direction and without any physical obstruction to prevent his witnesses; and
doing so. (Nera v. Rimando; Jaboneta v. Gustilo) (3) that the attesting witnesses witnessed the signing by the testator of
 Thus, where one of the witnesses, after signing the will, was about the will and all its pages, and that said witnesses also signed the
to leave the house when he saw the third witness in the act of will and every page thereof in the presence of the testator and of
affixing the latter’s signature but did not actually see the signing, it one another.
was ruled that the will was signed in his presence. (Jaboneta)
Effect of omission to state total number of paces refused to apply the rule on substantial compliance under Article
ARTICLE 809. In the absence of bad faith, forgery, or fraud, or undue 809 because the discrepancy cannot be explained by mere
and improper pressure and influence, defects and imperfections in examination of the will itself but through the presentation of
the form of attestation or in the language used therein shall not evidence aliunde. (Lopez v. Lopez)
render the will invalid if it is proved that the will was in fact executed
and attested in substantial compliance with all the requirements of 8. Requirement of Acknowledgement
article 805.
Requirement
 The purpose of the law in requiring the clause to state the number ARTICLE 806. Every will must be acknowledged before a notary
of pages is to safeguard against possible interpolation or omission public by the testator and the witnesses. The notary public shall not
of one or some of its pages and to prevent any increase or be required to retain a copy of the will, or file another with the office
decrease in the pages. (Caneda v. Cal Azuela v. CA; Lopez v. of the Clerk of Court.
Lopez)
 If the attestation clause does not state the number of pages but the  The will must be acknowledged before a notary public by the
same is stated elsewhere in the will, such as in the testator and the three instrumental witnesses.
Acknowledgement, the requirement of the law was substantially  A notarial will that is not acknowledged before a notary public by
complied with following the rule in Article 809. (Mitra v. Sablan- the testator ant the instrumental witnesses is void and cannot be
Guevarra; Taboada; Singson v. Florentino) accepted to probate. (Guerrero v. Bihis)
 The rule of substantial compliance in Article 809 must be limited  If the will is acknowledged before a notary public only by the
to disregarding those defects that can be supplied by an testator and not by the instrumental witnesses, the same is
examination of the will itself. (Caneda) void. (Garcia v. Gatchalian)
o However, there could have been no substantial compliance  Hence, if the notary public is also one of the three witnesses,
with the requirements under Article 805 if there is no the requirement of acknowledgment is not complied with because
statement in the attestation clause or anywhere in the will itself he cannot split his personality into two so that one will appear
as to the number of pages which comprises the will. (Azuela before the other to acknowledge his participation in the making of
v. CA; Echavez v. Dozen Construction) the will. (Cruz v. Villasor)
Effect of failure to state that all pages were signed Concept

 If the attestation clause failed to state that all the pages were  If the testator and the witnesses appeared before the notary public
signed by the testator and all the witnesses but a mere and avow to the certifying officer the authenticity of their signatures
examination of the signatures shows that every page thereof and the voluntariness of their actions in executing the testamentary
were actually signed, the requirement of the law has been disposition, the requirement of acknowledgment is satisfied.
complied with.  The notary public is not required to sign and affix his seal in
 The rule of substantial compliance applies. The rule of substantial the presence of the testator and the witnesses because those
compliance in Article 809 must be limited to disregarding those acts are not part of the acknowledgment itself nor of the
defects that can be supplied by an examination of the will itself: testamentary act. (Javellana v. Ledesma)
o whether all the pages are consecutively numbered; o In the same way, Article 806 NCC does not contain words
o whether the signatures appear in each and every page; requiring that the testator and the witnesses should
o whether the subscribing witnesses are three or the will was acknowledge the testament on the same day or occasion
notarized. that it was executed.
 All these are facts that the will itself can reveal, and defects or o Hence, the conflict between the dates appearing on the
even omissions concerning them in the attestation clause can be notarial will does not invalidate the document, because the
safely disregarded. law does not even require that a notarial will be executed and
acknowledged on the same occasion. (Ortega v. Valmonte)
Effect of failure to state that will was signed in each other’s
presence or that testator caused another to sign for him Acknowledgment outside the place of commission
The rule on substantial compliance under Article 809 does not apply  An acknowledgment taken outside the territorial limits of the
in the following situations: notary public’s jurisdiction is void as if the person taking it were
(1) if the attestation failed to state that the testator signed the will wholly without official character. (Guerrero v. Bihis)
in the presence of the witnesses; (Testate Estate of Paula Toray;  Outside of the place of his commission, a notary public is bereft of
Gil v. Murciano; Uy Coque v. Sioca) power to perform any notarial act—he is not a notary public.
(2) if the attestation clause failed to state that the witnesses signed o A will which has been acknowledged by the testatrix and the
the will in the presence of the testator, (Quinto v. Morata) or in instrumental witnesses before a notary public acting outside
the presence of each other; (Rodriguez v. Alcala; Uy Coque) the place of his commission is void and cannot be accepted
(3) or if the attestation failed to state the fact that the testator did not for probate.
personally sign the will, but requested another person to write his
name thereon, upon his express direction and in his presence. Mere jurat is fatally defective
(Garcia v. Lacuesta) Acknowledgment Jurat
(a) the omission is fatal because the attestation clause is the We, the testator and witnesses, Subscribed and sworn to me on
only evidence of such fact and evidence aliunde is not whose signature appear in the this day ______.
admissible to supply the omission. (Caneda) document, hereby acknowledge
that the signatures appearing
Effect of discrepancy in number of pages here are hours…
 Where the Acknowledgment states that the will consists of 7
pages, including the acknowledgment, but the will actually
consists of 8 pages including its acknowledgment, the Court
But if the jurat indicates “Subscribed and sworn to before me” – this  Where the testator is deaf or deafmute, the law requires that he
pertains to the acts of the testator and witnesses. The above ^ doesn’t must personally read the will, if able to do so.
even count as a jurat.  Otherwise, he should designate two persons who would read
the will and communicate its contents to him in a practicable
A will which does not contain an acknowledgment but a mere jurat is manner.
fatally defective, as the express requirement of Article 806 is that the will
be “acknowledged” and not merely subscribed and sworn to. (Azuela v. 10. Formalities Required in Holographic Wills
CA)
 "Nilagdaan ko at ninotario ko ngayong 10 ng Hunyo 10 (sic), 1981 (a) Concept and requisites
dito sa Lungsod ng Maynila." Concept
o By no manner of contemplation can those words be construed ARTICLE 810, NCC. A person may execute a holographic will which
as an acknowledgment. An acknowledgment is the act of one must be entirely written, dated, and signed by the hand of the testator
who has executed a deed in going before some competent himself. It is subject to no other form, and may be made in or out of
officer or court and declaring it to be his act or deed. the Philippines, and need not be witnessed.
o It involves an extra step undertaken whereby the signor
actually declares to the notary that the executor of a document  A holographic will must be entirely written, dated, and signed “by
has attested to the notary that the same is his/her own free the hand of the testator himself.”
act and deed.  It is subject to no other form, and may be made in or out of the
 A jurat is that part of an affidavit where the notary certifies that Philippines, and need not be witnessed. (Seangio v. Reyes)
before him/her, the document was subscribed and sworn to by the
executor. Requisites
(1) it must be entirely handwritten by the testator;
Absence of residence certificate invalidates will (2) it is dated by the hand of the testator; and
The absence of notation of the residence certificates of the notarial (3) it is signed by the hand of the testator himself. (810)
witnesses and the notation of the testator’s expired residence certificate
in the same acknowledgment make the acknowledgement fatally Requirement of date
defective and invalidates the will. (Lee v. Tamboago)  When there is no appearance of fraud, bad faith, undue influence,
and pressure and the authenticity of the will is established, the will
9. Special Requirements if Testator is Blind, Deaf, or Deaf- is still valid even if the date contains only the month and year.
Mute  The same is considered valid compliance with Article 810. (Roxas
de Jesus v. De Jesus)
(a) If testator is blind
Requirement of signature
ARTICLE 808, NCC. If the testator is blind, the will shall be read to The signature must be by the hand of the testator. Hence, signing by
him twice; once, by one of the subscribing witnesses, and again, by means of thumbprint is not allowed.
the notary public before whom the will is acknowledged.
(b) Effect of insertion in another’s handwriting
Requirement If words written by another person were inserted among the words
 A blind person is not incapacitated to make his will. written by the testator, the following shall be the consequences:
 If the testator is blind, the will should be read to him twice (1) if written after the execution of the will:
o once, by any one of the witnesses thereto, and (a) not validated by the testator with his full signature, the will
o again, by the notary public before whom it is acknowledged. remains valid and the insertion is void; or
 The rule applies not only to blind testators but also to those who, (b) validated by the testator with his full signature, the will
for one reason or another, are incapable of reading their wills, either becomes void because the insertion becomes part of the will;
because of poor or defective eyesight or because of illiteracy. (2) if written contemporaneously to the execution of the will, then
(Alvarado v. Gaviola) the will is void because the insertion becomes part of the will.
(Tolentino)
Effect of failure to comply
 If the foregoing requirements are not complied with, the will is void. (c) Rules when there are several dispositions:
 However, in a case where it was the lawyer who drafted the will, ARTICLE 812, NCC. In holographic wills, the dispositions of the
who read the same aloud to the testator and read them only once testator written below his signature must be dated and signed by him
but it was read aloud in the presence of the testator, the three in order to make them valid as testamentary dispositions.
instrumental witnesses and the notary public, and the testator
subsequently affirmed that the contents thereof corresponded with Rule: Dispositions of the testator written below his signature must be
his instructions, the Court held that the requirement of the will has dated and signed by him to make them valid as testamentary
been sufficiently complied with. dispositions.
(b) If testator is deaf or deaf-mute Effect if not complied with

ARTICLE 807, NCC. If the testator be deaf, or a deaf-mute, he must ARTICLE 813. When a number of dispositions appearing in a
personally read the will, if able to do so; otherwise, he shall designate holographic will are signed without being dated, and the last
two persons to read it and communicate to him, in some practicable disposition has a signature and a date, such date validates the
manner, the contents thereof. dispositions preceding it, whatever be the time of prior dispositions.
 A deaf or deaf-mute is not incapacitated to make his will.

 If one disposition below the signature of the testator is not dated, The will of an alien who is abroad produces effect in the Philippines if:
even if signed, that particular disposition will be void, without (1) made with the formalities prescribed by the law of the place in
affecting the validity of the others or of the will itself. (Tolentino) which he resides;
 However, when a number of dispositions appearing in a (2) made according to the formalities observed in his country; or
holographic will are signed without being dated, and the last (3) made in conformity with the formalities prescribed in the PH.
disposition has a signature and date, such date validates the
dispositions preceding it, whatever be the time of prior dispositions. (c) The will of an alien made in the Philippines shall produce
effect in the Philippines if:
(d) Insertion, cancellation, erasure, or alteration ARTICLE 817. A will made in the Philippines by a citizen or subject
ARTICLE 814. In case of any insertion, cancellation, erasure or of another country, which is executed in accordance with the law of
alteration in a holographic will, the testator must authenticate the the country of which he is a citizen or subject, and which might be
same by his full signature. proved and allowed by the law of his own country, shall have the
same effect as if executed according to the laws of the Philippines.
 In case of insertion, cancellation, erasure, or alteration in a
holographic will, the testator must authenticate the same by his ARTICLE 818. Two or more persons cannot make a will jointly,
full signature; otherwise, the same is considered not made but the or in the same instrument, either for their reciprocal benefit or for the
will is not invalidated. (Kalaw v. Relova) benefit of a third person.
 However, where the testator himself crossed out the name of the
heir named, and substituted the name of another, without ARTICLE 819. Wills, prohibited by the preceding article, executed by
authentication, it was held that this did not result in making Filipinos in a foreign country shall not be valid in the Philippines,
the person whose name was crossed as heir. even though authorized by the laws of the country where they may
have been executed.
11. Laws Governing Formalities of Wills
(1) executed in accordance with the law of the country of which he
(a) When executed by Filipinos is a citizen; and
ARTICLE 17, NCC. X (2) which might be proved and allowed by the law of his own country.
ARTICLE 815. When a Filipino is in a foreign country, he is  The prohibition against the making of a joint will applies only to
authorized to make a will in any of the forms established by the citizens of the Philippines.
law of the country in which he may be. Such will may be probated  The wills of foreigners made in the Philippines shall be valid if
in the Philippines. executed in accordance with the law of the country of which he is a
citizen or subject and which might be proved and allowed by the
Rule law of his own country, even if made in the form of a joint will.
 When a Filipino is in a foreign country, he is authorized to make
a will in any of the forms established by the law of the country in D. Codicils and Subsequent Wills
which he may be.
 Being valid, such will may be probated in the Philippines. 1. Codicil
EXC Concept
ARTICLE 819. Wills, prohibited by the preceding article, executed by ARTICLE 825. A codicil is a supplement or addition to a will,
Filipinos in a foreign country shall not be valid in the Philippines, made after the execution of a will and annexed to be taken as a
even though authorized by the laws of the country where they may part thereof, by which any disposition made in the original will is
have been executed. explained, added to, or altered.
 Joint wills executed by Filipinos in a foreign country shall not be ARTICLE 830(2), NCC. No will shall be revoked except in the
valid in the Philippines, even though authorized by the laws of the following cases:
country where they may have been executed. (2) By some will, codicil, or other writing executed as provided in case
 A joint will is one where the same instrument contains the wills of wills; or
of two or more persons and is jointly signed by them.
o It is different from mutual wills, which are separate wills ARTICLE 836, NCC. The execution of a codicil referring to a previous
of two persons for their reciprocal benefit. What the law will has the effect of republishing the will as modified by the codicil.
expressly prohibits is the making of joint wills either for the
testators’ reciprocal benefit or for the benefit of a third person.  A codicil is a supplement or addition to a will, made after the
(Vda. De Perez v. Tolete) execution of a will and annexed to be taken as a part thereof, by
o Hence, the separate wills of the spouses which contain which any disposition made in the original will is explained, added
essentially the same provisions and pertain to property which to, or altered.
in all probability are conjugal in nature may be probated jointly.  A codicil may also revoke a previous will or cause its republication.
 If the later instrument makes dispositions independent of those
(b) When executed by aliens in the original will, without explaining or modifying such
ARTICLE 816. The will of an alien who is abroad produces effect original will, then it is a new will, not a codicil.
in the Philippines if made with the formalities prescribed by the law of
the place in which he resides, or according to the formalities Form required
observed in his country, or in conformity with those which this Code ARTICLE 826. In order that a codicil may be effective, it shall be
prescribes. executed as in the case of a will.
 In order that a codicil may be effective, it shall be executed as in Modes of revoking wills in Philippines
the case of a will. ARTICLE 830. No will shall be revoked except in the following cases:
 If the will to which a codicil refers is a holographic will, the law does (1) By implication of law; or
not require that the codicil be also in the form of a holographic will. (2) By some will, codicil, or other writing executed as provided in
case of wills; or
2. Incorporation by Reference (3) By burning, tearing, cancelling, or obliterating the will with
the intention of revoking it, by the testator himself, or by some
ARTICLE 827. If a will, executed as required by this Code, other person in his presence, and by his express direction. If
incorporates into itself by reference any document or paper, burned, torn, cancelled, or obliterated by some other person,
such document or paper shall not be considered a part of the without the express direction of the testator, the will may still be
will unless the following requisites are present: established, and the estate distributed in accordance therewith,
(1) The document or paper referred to in the will must be in if its contents, and due execution, and the fact of its
existence at the time of the execution of the will; unauthorized destruction, cancellation, or obliteration are
(2) The will must clearly describe and identify the same, stating established according to the Rules of Court.
among other things the number of pages thereof;
(3) It must be identified by clear and satisfactory proof as the (1) by implication of law;
document or paper referred to therein; and (2) by subsequent will, codicil, or subsequent instrument; or
(4) It must be signed by the testator and the witnesses on each (3) by physical destruction.
and every page, except in case of voluminous books of account
or inventories. 2. Revocation by Implication of Law
The law allows documents and papers to be incorporated or be made (a) How it takes place
part of an ordinary will by mere reference provided the following When certain acts or events take place subsequent to the making of a
requisites are present: will which nullify or render inoperative either the will itself or some
(1) the document or paper must exist at the time of the execution testamentary disposition therein.
of the will;
(2) the document or paper must be clearly described and identified (b) Instances when it takes place
in the will, stating among others the number of pages;
(3) the document or paper must be identified by clear and (1) Upon the termination of the subsequent marriage in Article 41 FC
satisfactory proof as the document or paper referred to in the will; through the filing of the affidavit of reappearance, the spouse who
and contracted the marriage in bad faith shall be disqualified to inherit
(4) the document or paper must be signed by the testator and the from the innocent spouse by testate and intestate succession; (Art.
witnesses on each and every page, except in case of voluminous 43[5] FC) hence, any testamentary disposition in the will of the
books of account or inventories. innocent spouse in favor of the guilty' spouse shall be revoked by
implication of law;
E. Revocation of Wills (2) If both spouses of the subsequent marriage referred to in
Article 41 FC acted in bad faith, testamentary dispositions by one
1. Revocability of Wills in favor of the other are revoked by operation of law; (44 FC)
(3) In case of annulment, the spouse who contracted the marriage
Rule in bad faith shall be disqualified to inherit from the innocent spouse
ARTICLE 828, NCC. A will may be revoked by the testator at any by testate and intestate succession; (50, in relation to 43[5] FC)
time before his death. Any waiver or restriction of this right is void. hence, any testamentary disposition in the will of the innocent
spouse in favor of the guilty spouse shall be revoked by implication
 A will may be revoked by the testator at any time before his death. of law;
o In other words, a will is essentially ambulatory; at any time (4) Upon issuance of the decree of legal separation, provisions in favor
prior to the testator’s death, it may be changed or revoked. of the offending spouse made in the will of the innocent spouse
(Caniza v. CA) shall be revoked by operation of law; (63[4] FC)
 Any waiver or restriction of the right to revoke the will is void. This (5) In case of preterition of compulsory heirs in the direct line, whether
rule holds true even if such previous will had already been living at the time of the execution of the will or born after the death
probated. (Alsua-Betts) of the testator; in which case the institution of heirs shall be
annulled but without affecting the devises and legacies;
Laws governing validity of revocation (6) When the HDL commits any of the acts of unworthiness which by
ARTICLE 829, NCC. X express provision of law will incapacitate him to succeed; in which
ease any testamentary disposition in favor of such HDL is revoked;
(7) When in the testator’s will there is a legacy of a credit against a
If revocation is by a person not domiciled in the PH, the
third person or of the remission of a debt of the legatee and,
done outside revocation is valid when it is done according to
subsequently after the execution of the will, the testator brings an
the PH the law of the place where the will was made
action against the debtor for the payment of his debt, the legacy is
or the law of the place in which the testator had
considered revoked; (935, 936) and
domicile at the time of revocation;
(8) When the testator transforms the thing bequeathed in such a
by a person domiciled in the PH, the revocation
manner that it does not retain either the form or denomination it
must be done in accordance with PH laws.
had, or when he alienates by any title or for any cause the thing
If revocation is it must be done in accordance with Philippine
bequeathed or any part thereof, or when the thing bequeathed is
done in the PH laws, whether the testator be domiciled in the
totally lost during the testator’s lifetime or after his death without the
Philippines or not.
heir’s fault, in which cases, the legacy is considered revoked. (957)
ARTICLE 854, NCC. The preterition or omission of one, some, or all respect to the part thus alienated. If after the alienation the
of the compulsory heirs in the direct line, whether living at the time of thing should again belong to the testator, even if it be by
the execution of the will or born after the death of the testator, shall reason of nullity of the contract, the legacy or devise shall not
annul the institution of heir; but the devises and legacies shall be valid thereafter be valid, unless the reacquisition shall have been
insofar as they are not inofficious. effected by virtue of the exercise of the right of repurchase;
(3) If the thing bequeathed is totally lost during the lifetime of the
If the omitted compulsory heirs should die before the testator, the testator, or after his death without the heir’s fault.
institution shall be effectual, without prejudice to the right of Nevertheless, the person obliged to pay the legacy or devise
representation. shall be liable for eviction if the thing bequeathed should not
have been determinate as to its kind, in accordance with the
ARTICLE 1032, NCC. The following are incapable of succeeding by provisions of article 928.
reason of unworthiness:
(1) Parents who have abandoned their children or induced their 3. Revocation by Subsequent Instrument
daughters to lead a corrupt or immoral life, or attempted against
their virtue; (a) How it takes place
(2) Any person who has been convicted of an attempt against ARTICLE 830(2), NCC. No will shall be revoked except in the
the life of the testator, his or her spouse, descendants, or following cases:
ascendants; (2) By some will, codicil, or other writing executed as provided in case
(3) Any person who has accused the testator of a crime for of wills; or
which the law prescribes imprisonment for six years or
more, if the accusation has been found groundless;  A will may be revoked by some will, codicil, or other writing
(4) Any heir of full age who, having knowledge of the violent death executed as provided in case of wills.
of the testator, should fail to report it to an officer of the law  The subsequent instrument must also be executed following
within a month, unless the authorities have already taken action; the formalities of a will. An example of other writing is donation
this prohibition shall not apply to cases wherein, according to mortis causa, which is required to be executed in the form of a last
law, there is no obligation to make an accusation; will and testament.
(5) Any person convicted of adultery or concubinage with the
spouse of the testator; The revocation may be done either expressly or impliedly.
(6) Any person who by fraud, violence, intimidation, or undue
influence should cause the testator to make a will or to change (b) Express revocation
one already made; Concept: When the subsequent instrument contains a revocatory
(7) Any person who by the same means prevents another from clause expressly declaring the revocation of the will or a part thereof.
making a will, or from revoking one already made, or who
supplants, conceals, or alters the latter’s will; Effect of disallowance of subsequent instrument
(8) Any person who falsifies or forges a supposed will of the There is no revocation of the previous will if the subsequent instrument
decedent. is disallowed because of failure to comply with the formalities required
of a will, inasmuch as the revocatory clause in the subsequent
ARTICLE 935. The legacy of a credit against a third person or of instrument is void. (Samson v. Naval; Molo v. Molo)
the remission or release of a debt of the legatee shall be effective
only as regards that part of the credit or debt existing at the time of Effect if subsequent instrument is valid but inoperative
the death of the testator. ARTICLE 832, NCC. A revocation made in a subsequent will shall
take effect, even if the new will should become inoperative by reason
In the first case, the estate shall comply with the legacy by assigning of the incapacity of the heirs, devisees or legatees designated
to the legatee all rights of action it may have against the debtor. In therein, or by their renunciation.
the second case, by giving the legatee an acquittance, should he
request one. The revocation takes effect if the subsequent instrument is valid as
to formalities even if the will shall thereafter become inoperative
In both cases, the legacy shall comprise all interests on the credit because of:
or debt which may be due the testator at the time of his death. (1) incapacity of the heirs, devisees, or legatees designated therein; or
(2) renunciation or repudiation.
ARTICLE 936. The legacy referred to in the preceding article shall
lapse if the testator, after having made it, should bring an action If revocation is based on false or illegal cause
against the debtor for the payment of his debt, even if such ARTICLE 833, NCC. A revocation of a will based on a false cause or
payment should not have been effected at the time of his death. an illegal cause is null and void.
The legacy to the debtor of the thing pledged by him is understood to  The revocation of a will based on a false cause or illegal cause is
discharge only the right of pledge. null and void.
 For the rule to apply, it is necessary that the fact or cause, with
ARTICLE 957. The legacy or devise shall be without effect: regard to which the mistake was made, must appear upon the
(1) If the testator transforms the thing bequeathed in such a face of the instrument.
manner that it does not retain either the form or the
denomination it had; (c) Implied revocation
(2) If the testator by any title or for any cause alienates the thing
bequeathed or any part thereof, it being understood that in the ARTICLE 831, NCC. Subsequent wills which do not revoke the
latter case the legacy or devise shall be without effect only with previous ones in an express manner, annul only such dispositions in
the prior wills as are inconsistent with or contrary to those contained testator meant the revocation of the old to depend upon the efficacy
in the later wills. of a new disposition intended to be substituted, the revocation will
be conditional and dependent upon the efficacy of the new
 Subsequent instrument contains no revocatory clause but its disposition; and if, for any reason, the new will intended to be
provisions are totally incompatible with the previous will. made as a substitute is inoperative, the revocation fails and the
 Subsequent wills which do not revoke the previous ones in an original will remains in full force.”
express manner, annul only such dispositions in the prior wills as (Molo v. Molo)
are inconsistent with or contrary to those contained in the later wills.
F. Republication and Revival of Wills
4. Revocation by Physical Destruction
1. Revival of Wills
How it takes place
ARTICLE 830(3), NCC. No will shall be revoked except in the Concept
following cases: It is the process of renewing or restoring, by operation of law, the
(3) By burning, tearing, cancelling, or obliterating the will with the operative force of a will which has been lost because the will has been
intention of revoking it, by the testator himself, or by some other previously revoked by implication of law or by a subsequent instrument.
person in his presence, and by his express direction. If burned, torn,
cancelled, or obliterated by some other person, without the express If previous will was revoked by subsequent instrument
direction of the testator, the will may still be established, and the ARTICLE 837, NCC. If after making a will, the testator makes a
estate distributed in accordance therewith, if its contents, and due second will expressly revoking the first, the revocation of the second
execution, and the fact of its unauthorized destruction, cancellation, will does not revive the first will, which can be revived only by another
or obliteration are established according to the Rules of Court. will or codicil.
(1) burning;  If a previous will was revoked expressly by a second will, the
(2) tearing; revocation of the second will does not revive the first will.
(3) cancelling;  Hence, the force of the previous will can only be re-established thru
(4) obliterating the will; or republication either:
(5) other forms of physical destruction, (a) by reproducing the contents of a previous will (to be
republished) in a subsequent will; or
Requisites (b) by execution of a codicil referring to the previous to be
(1) At the time of performing it, testator must have testamentary republished.
capacity  If a previous will was revoked impliedly by a second will and the
(2) destruction must be with intent to revoke (animus revocandi)-, latter will is also revoked, the previous will is automatically revived.
(3) there must be evidence of the overt act of physical destruction
(4) the revocation must have been a completed act. If previous will was revoked by implication of law
 In legal separation, provisions in favor of the offending spouse
Animus revocandi alone is not sufficient. It must be accompanied by made in the will of the innocent spouse shall be revoked by
the overt physical act of burning, tearing, obliterating, or cancelling the operation of law upon the issuance of the decree of legal
will carried out by the testator or by another person in his presence and separation. (63[4] FC)
under his express direction.  However, upon the issuance of a decree of reconciliation, the
(Testate Estate of Adriana Maloto v. CA) decree of legal separation is set aside. As a consequence, the
provisions in favor of the offending spouse made in the will of the
Destruction by another person innocent spouse are automatically revived.
The physical destruction need not be done personally by the testator.
The physical destruction may be done by some other person provided 2. Republication of Wills
the following requisites are complied with:
(1) the document destroyed was in fact the will of the deceased; Concept
(2) the overt act was at the decedent’s express direction; and It is the re-execution or reestablishment, by a positive act of the testator,
(3) that the same was done in the presence of said decedent. of the force of a will which has been lost either because the will is void
or it has been previously revoked,
 If the destruction by another person was not authorized by the
testator, the will is not revoked and parol evidence is competent Two ways of republishing wills
to prove the contents or provisions of the will pursuant to Rule 77. ARTICLE 935. The legacy of a credit against a third person or of
(Timbol v. Manalo) the remission or release of a debt of the legatee shall be effective
 However, Rule 77 contemplates the probate of lost or destroyed only as regards that part of the credit or debt existing at the time of
attested/notarial wills only. the death of the testator.
o With respect to a holographic will, the same cannot be
probated in case it has been lost or destroyed and there In the first case, the estate shall comply with the legacy by assigning
was no copy left, even if the loss or destruction was to the legatee all rights of action it may have against the debtor. In
unauthorized. (Gan v. Yap) the second case, by giving the legatee an acquittance, should he
o However, if there is a photostatic or Xerox copy left, then the request one.
will may still be probated. (Rodelas v. Aranza)
In both cases, the legacy shall comprise all interests on the credit
Doctrine of “dependent relative revocation” or debt which may be due the testator at the time of his death.
 Where the act of physical destruction is connected with the
making of another will so as fairly to raise the inference that the
ARTICLE 936. The legacy referred to in the preceding article shall o The disinheritance results in the disposition of the property of
lapse if the testator, after having made it, should bring an action the testator in favor of those who would succeed in the
against the debtor for the payment of his debt, even if such absence of the disinherited heir. Unless the will is probated,
payment should not have been effected at the time of his death. the disinheritance cannot be given effect. (Seangio v. Reyes)
 Following this rule, in testate succession, there can be no valid
The legacy to the debtor of the thing pledged by him is understood to partition among the heirs until after the will has been probated.
discharge only the right of pledge. (Union Bank v. Santibanez)
 The heirs may not disregard the provisions of the will unless those
(1) by reproducing the contents of a previous will (to be provisions are contrary to law.
republished) in a subsequent will; or o Neither may they do away with the presentation of the will to
(2) by execution of a codicil referring to the previous will to be the court for probate, because such suppression of the will is
republished. contrary to law and public policy.
o The law enjoins the probate of the will and public policy
 The execution of a codicil referring to a previous will has the effect requires it, because unless the will is probated and notice
of republishing the will as modified by the codicil. thereof given to the whole world, the right of a person to
 If the previous will is void as to its form, it can only be republished dispose of his property by will may be rendered nugatory.
by reproducing the provisions thereof in a subsequent will. (Guevarra v. Guevarra)
 There is no other way.
Prescription and estoppel inapplicable
G. Probate of Wills  Following the rule that probate is mandatory and is a matter of
public policy,
1. Concept o a petition for probate is not subject to the statute of
limitations (Guevarra)
Definition o nor may it be prevented by the application of the principle of
 To probate a will means to prove before some officer or tribunal, estoppel. (Alsua-Betts)
vested by law with authority for that purpose,  Testate Estate of Adriana Maloto v. CA: heirs of the deceased
o that the instrument offered to be proved is the last will and agreed to partition the estate, which was approved by the court in
testament of the deceased person whose testamentary act it estate proceedings; but 3 years after, a document purporting to be
is alleged to be; and the decedent’s last will and testament was discovered.
o that it has been executed, attested, and published as required o It was held that the probate of the will was not barred by the
by law, and intestate settlement of estate proceedings. But once probated,
o that the testator was of sound and disposing mind. an action for the “annulment” of a will may be barred by res
 It is a proceeding to establish the validity of the will. (Heirs of judicata and prescription. (Gallamosa v. Arcangel)
Rosendo Lasam v. Umengan)
2. Issues in Probate Proceedings
The probate is either:
(1) ante mortem - that which is had during the lifetime of the testator GR: It should be noted that probate proceedings deal generally with the
(2) post mortem - that which is had after the death of the testator, extrinsic validity of the will sought to be probated, (Dorotheo v. CA)
particularly on the following aspects:
When probate mandatory (1) whether the will submitted is indeed, the decedent’s last will and
ARTICLE 838. No will shall pass either real or personal property testament;
unless it is proved and allowed in accordance with the Rules of (2) compliance with the formalities for the execution of wills;
Court. (3) the testamentary capacity of the testator; and
(4) the due execution of the last will and testament (Ajero v. CA)
The testator himself may, during his lifetime, petition the court
having jurisdiction for the allowance of his will. In such case, the  Under the CC, due execution includes a determination of whether
pertinent provisions of the Rules of Court for the allowance of wills the testator was of sound and disposing mind at the time of its
after the testator’s death shall govern. execution, that he had freely executed the will and was not acting
under duress, fraud, menace, or undue influence, that the will is
The Supreme Court shall formulate such additional Rules of Court as genuine and not a forgery (Dorotheo), that he was of the proper
may be necessary for the allowance of wills on petition of the testator. testamentary age, and that he is a person not expressly prohibited
by law from making a will. (796-798)
Subject to the right of appeal, the allowance of the will, either during
the lifetime of the testator or after his death, shall be conclusive as to EXCEPTION
its due execution.  As a rule, courts in probate proceedings are limited to pass
only upon the extrinsic validity of the will sought to be probated
 So long as the will involves disposition of property, the conduct of (Reyes v. CA) and the intrinsic validity is not considered since the
probate is mandatory. consideration thereof usually comes only after the will has been
o This is pursuant to the rule in Article 838 that “no will shall proved and allowed.
pass either real or personal property unless it is proved and  However, the rule on probate is not inflexible and absolute.
allowed in accordance with the Rules of Court. (Caniza v. CA)
 Even if the will does not make an affirmative act of disposition Under exceptional circumstances, the Court had passed upon the
of the testator’s property but only provides for the intrinsic validity of a will even before it had been authenticated (Alsua-
disinheritance of a compulsory heir, the probate of the will cannot Betts) as follows:
be dispensed with because the disinheritance is an act of (1) when the parties agree that the intrinsic validity be first
disposition in itself. determined, the probate court may do so; (Reyes)
(2) when the defect of the will is apparent on its face or when the pays a legacy in compliance with a clause in the defective will, the
testamentary provisions are of doubtful legality and the probate of payment is effective and irrevocable.
the will may become a useless ceremony if it is intrinsically invalid  It is a case of natural obligation.
(Reyes) and
(3) when the issue of intrinsic validity of the will is determinative 4. Effect of Disallowance of Wills
of the necessity of conducting the probate proceeding, then
practical consideration dictates that the probate court should first  The probate of a will is conclusive as to its due execution and
resolve such issue; otherwise, the probate of the will may become extrinsic validity. (S1, R75)
a useless ceremony (Morales v. Olondriz)  The matters of due execution of the will and the capacity of the
(4) Examples of the third exception are the following: testator acquires the character of res judicata and cannot again be
(a) when the issue presented during probate is whether the brought into question, all juridical questions in connection therewith
instrument is a donation inter vivos or mortis causa; (Del being for once and forever closed.
Rosario v. Ferrer) or o Such final order makes the will conclusive against the whole
(b) when the issue presented during the probate is the preterition world as to its extrinsic validity and due execution. (Dorotheo)
of a compulsory heir in the direct line and the will does not  The intrinsic validity is another matter and questions regarding the
contain any devises or legacies, because if the claim is true, same may still be raised even after the will has been authenticated.
the conduct of separate proceedings to determine the intrinsic
validity of its testamentary provisions would be superfluous. 5. Probate of Wills of Foreigners
(Nuguid v. Nuguid)
 Our laws do not prohibit the probate of wills executed by foreigners
However, if there are devises and legacies in the will, the probate court abroad although the same have not as yet been probated and
may not pass upon the issue of preterition. allowed in the countries of their execution.
 This is because a foreign will can be given legal effects in our
3. Grounds for Disallowance of Wills jurisdiction pursuant to Article 816. (Palaganas v. Palaganas)
ARTICLE 839. The will shall be disallowed in any of the following H. Testamentary Succession: Legitime
cases:
(1) If the formalities required by law have not been complied 1. Extent of Power to Dispose of Estate
with;
(2) If the testator was insane, or otherwise mentally incapable of (a) Not an absolute right
making a will, at the time of its execution;
(3) If it was executed through force or under duress, or the ARTICLE 738, NCC. All those who are not specially disqualified by
influence of fear, or threats; law therefor may accept donations.
(4) If it was procured by undue and improper pressure and
influence, on the part of the beneficiary or of some other
ARTICLE 886. Legitime is that part of the testator’s property
person;
which he cannot dispose of because the law has reserved it for
(5) If the signature of the testator was procured by fraud;
certain heirs who are, therefore, called compulsory heirs.
(6) If the testator acted by mistake or did not intend that the
instrument he signed should be his will at the time of affixing
ARTICLE 904, NCC. The testator cannot deprive his compulsory
his signature thereto.
heirs of their legitime, except in cases expressly specified by law.
ARTICLE 797. Persons of either sex under eighteen years of age

Neither can he impose upon the same any burden, encumbrance,
cannot make a will.
condition, or substitution of any kind whatsoever.
ARTICLE 1430, NCC. When a will is declared void because it has

 The right of a person to dispose of his property by will is not natural
not been executed in accordance with the formalities required by law,
but statutory.
but one of the intestate heirs, after the settlement of the debts of the
o Hence, Congress may provide for limitations.
deceased, pays a legacy in compliance with a clause in the defective
 The basic limitation on the testator’s power to dispose of his
will, the payment is effective and irrevocable.
estate is the concept of legitime, which refers to that part of the
testator’s hereditary estate which he cannot dispose of because the
(1) failure to comply with the formalities required by law;
law has already reserved it in favor of the testator’s compulsory
(2) testator was insane or otherwise mentally incapable of making a
heirs.
will at the time of its execution;
o The testator cannot deprive his compulsory heirs of their
(3) will was executed through force or undue duress, or the influence
legitime, except by way of a valid disinheritance.
of fear or threats;
(4) will was procured by undue and improper pressure and influence
(b) Extent of testator’s right to dispose of his estate
on the part of the beneficiary or of some other person;
ARTICLE 842. One who has no compulsory heirs may dispose by
(5) signature of testator was procured by fraud;
will of all his estate or any part of it in favor of any person having
(6) testator acted by mistake or did not intend that the instrument he
capacity to succeed.
signed should be his will at the time of affixing his signature; and
(7) testator was below 18 years of age at the time of the execution
One who has compulsory heirs may dispose of his estate provided
of the will.
he does not contravene the provisions of this Code with regard to the
legitime of said heirs.
 When a will is declared void because it has not been executed in
accordance with the formalities required by law, but one of the
intestate heirs, after the settlement of the debts of the deceased,
 If the testator has no compulsory heirs, he may dispose by will  The only encumbrance that the testator may validly
of all his estate or any part thereof in any manner that he pleases impose upon the legitime is the prohibition against
and in favor of any person having capacity to succeed, partition for a period not exceeding 20 years.
o The entire estate is the disposable free portion.
 if the testator has compulsory heirs, he may dispose of his estate (e) Future legitime cannot be renounced or compromised
provided he does not deprive his compulsory heirs of their
legitime. ARTICLE 905, NCC. Every renunciation or compromise as regards
o He can only dispose of the remaining portion of the estate a future legitime between the person owing it and his compulsory
after satisfying the legitime of all compulsory heirs, which heirs is void, and the latter may claim the same upon the death of the
remaining portion is known as the disposable free portion, former; but they must bring to collation whatever they may have
received by virtue of the renunciation or compromise.
(c) Testator cannot deprive compulsory heirs of their legitime
ARTICLE 904, NCC. The testator cannot deprive his compulsory Every renunciation or compromise as regards a future legitime
heirs of their legitime, except in cases expressly specified by law. between the person owing it and his compulsory heirs is void, and
the latter may claim the same upon the death of the former.
condition, or substitution of any kind whatsoever. 2. Compulsory Heirs
ARTICLE 915, NCC. A compulsory heir may, in consequence of Kinds of compulsory heirs
disinheritance, be deprived of his legitime, for causes expressly (1) Primary compulsory heirs - those who have precedence over and
stated by law. exclude the secondary compulsory heirs; (Arellano v. Pascual)
(2) Secondary compulsory heirs - those who succeed only in the
ARTICLE 907. Testamentary dispositions that impair or diminish absence of the primary heirs; and
the legitime of the compulsory heirs shall be reduced on petition (3) Concurring compulsory heirs - those who succeed together with
of the same, insofar as they may be inofficious or excessive. the primary or secondary compulsory heirs.
 The testator cannot deprive his compulsory heirs of their legitime, Primary and secondary compulsory heirs
except by way of a valid disinheritance. ARTICLE 903, NCC. The legitime of the parents who have an
 Testamentary dispositions that impair or diminish the legitime of the illegitimate child, when such child leaves neither legitimate
compulsory heirs shall be inofficious or excessive and may be descendants, nor a surviving spouse, nor illegitimate children, is one-
reduced upon the petition of the compulsory heir concerned. half of the hereditary estate of such illegitimate child. If only legitimate
or illegitimate children are left, the parents are not entitled to any
 What may be given in favor of a voluntary heir, devisee, or legatee
is only the disposable free portion. Hence, the concepts of legitime whatsoever. If only the widow or widower survives with
parents of the illegitimate child, the legitime of the parents is one-
institution of heirs, legacies and devises, substitution, conditions
and terms are applicable only to the disposable free portion. fourth of the hereditary estate of the child, and that of the surviving
spouse also one-fourth of the estate.
(d) Testator cannot affect legitime
(1) Legitimate decedent – the primary compulsory heirs are the
legitimate children and/or descendants; while the secondary
ARTICLE 904, para. 2, NCC. X
compulsory heirs are the legitimate parents and/or ascendants.
(2) Illegitimate decedent – his children or their descendants, whether
ARTICLE 872, NCC. The testator cannot impose any charge,
legitimate or illegitimate, will exclude the decedent’s illegitimate
condition, or substitution whatsoever upon the legitimes prescribed
parents.
in this Code. Should he do so, the same shall be considered as not
(a) In other words, the illegitimate parents are compulsory heirs
imposed.
only when the deceased does not have descendants, whether
legitimate or illegitimate.
ARTICLE 1083, NCC. Every co-heir has a right to demand the
division of the estate unless the testator should have expressly
Concurring compulsory heirs
forbidden its partition, in which case the period of indivision shall not
 The surviving spouse and illegitimate children or the latter’s
exceed twenty years as provided in article 494. This power of the
descendants are concurring compulsory heirs.
testator to prohibit division applies to the legitime.
 However, when the decedent is illegitimate and
o he dies without leaving legitimate descendants but
Even though forbidden by the testator, the co-ownership terminates
o he is survived by his illegitimate children or the latter’s
when any of the causes for which partnership is dissolved takes
descendants,
place, or when the court finds for compelling reasons that division
o such illegitimate children or their descendants shall
should be ordered, upon petition of one of the co-heirs.
exclude the decedent’s illegitimate parents.
 The testator cannot impose any charge, burden, encumbrance,

Collateral relatives are not compulsory heirs
condition, or substitution of any kind whatsoever upon the
 With the exception of the surviving spouse who is related to the
legitimes.
decedent by affinity, all compulsory heirs are relatives of the
o The same shall be considered as not imposed.
decedent in the direct line.
 The foregoing can only be validly imposed upon the disposable free
 The collateral blood relatives, starting from the decedent’s brothers
portion.
and sisters, are not compulsory heirs.
o Exception:
3. Primary Compulsory Heirs
(a) Legitimate children or their descendants parent shall not have the usufruct or administration of the property
(1) Adopted children included which constitutes the legitime.
o An adopted child is considered a legitimate child of the
adopter ‘‘for all intents and purposes and as such entitled to ARTICLE 1035, NCC. If the person excluded from the inheritance by
all the rights and obligations provided by law to legitimate reason of incapacity should be a child or descendant of the decedent
sons/daughters born to them without discrimination of any and should have children or descendants, the latter shall acquire his
kind right to the legitime.
o these rights include the right to the legitime and other
successional rights granted under the Civil Code (174[3] FC) The person so excluded shall not enjoy the usufruct and
o However, a mere ampun-ampunan, without the benefit of administration of the property thus inherited by his children.
formal (judicial) adoption, is neither a compulsory nor a
legal heir because of such relationship alone. (Lim v. IAC; ARTICLE 970, NCC. Representation is a right created by fiction of
Manuel v Ferrer) law, by virtue of which the representative is raised to the place and
the degree of the person represented, and acquires the rights which
(2) Conceived child included the latter would have if he were living or if he could have inherited.
ARTICLE 1025, para. 2, NCC. In order to be capacitated to inherit,
the heir, devisee or legatee must be living at the moment the ARTICLE 974, NCC. Whenever there is succession by
succession opens, except in case of representation, when it is representation, the division of the estate shall be made per stirpes,
proper. in such manner that the representative or representatives shall not
inherit more than what the person they represent would inherit, if he
A child already conceived at the time of the death of the decedent is were living or could inherit.
capable of succeeding provided it be born later under the conditions
prescribed in article 41. ARTICLE 1021, NCC. Among the compulsory heirs the right of
o A conceived child is already a compulsory heir entitled to a accretion shall take place only when the free portion is left to two or
legitime, provided it be born later under the conditions more of them, or to any one of them and to a stranger.
required in Article 41 CC. (Quimiging v. Icao)
Should the part repudiated be the legitime, the other co-heirs shall
(3) Even if from different marriages succeed to it in their own right, and not by the right of accretion.
ARTICLE 979, NCC. Legitimate children and their descendants
succeed the parents and other ascendants, without distinction as to (DIP)
sex or age, and even if they should come from different marriages.
 In the event of vacancy among the children by reason of
predecease, disinheritance, or incapacity, representation is
An adopted child succeeds to the property of the adopting parents in allowed by law if the child who died ahead of the testator, or
the same manner as a legitimate child.
who is disinherited or incapacitated, has a child who may take
his place.
 Legitimate children and their descendants succeed the parents and o The legitime of the child who died ahead of the testator, or
other ascendants, without distinction as to sex or age, and even if who is disinherited or incapacitated, shall go to his child or
they should come from different marriages. children.
o Hence, whenever there is succession by representation, the
(b) Rule of proximity division of the estate shall be made per stirpes,
ARTICLE 962, para. 1, NCC. In every inheritance, the relative  in such a manner that the representative or
nearest in degree excludes the more distant ones, saving the right of representatives shall not inherit more than what the
representation when it properly takes place. person they represent would inherit, if he were living or
could inherit.
Relatives in the same degree shall inherit in equal shares, subject to  However, if representation cannot take place because the one who
the provisions of article 1006 with respect to relatives of the full and predeceased, was disinherited, or incapacitated does not have a
half blood, and of article 987, paragraph 2, concerning division descendant who can represent him, the following shall be the
between the paternal and maternal lines. rules:
o (1) in case of predecease or disinheritance, the child who
 In the legitimate descending line, the children exclude the died ahead or who is disinherited is no longer counted
grandchildren and great-grandchildren of the decedent following because he is no longer a compulsory heir;
the rule of proximity—that the nearest in degree excludes the more o (2) in case of incapacity
remote, except in cases where representation is proper.  he is still counted as one of the compulsory heirs
 If all the legitimate children are living and with capacity to succeed  but his share of the legitime shall be given to the
and none of them have been disinherited, only such children legal heirs of the testator following the rules of
succeed, to the exclusion of the other legitimate descendants, intestate succession.
 His share cannot accrue to the other children
(c) Subject to right of representation because the right of accretion cannot take place with
ARTICLE 981, NCC. Should children of the deceased and respect to the legitime.
descendants of other children who are dead, survive, the former shall
inherit in their own right, and the latter by right of representation. (d) If vacancy is by reason of repudiation
ARTICLE 977, NCC. Heirs who repudiate their share may not be
ARTICLE 923, NCC. The children and descendants of the person represented.
disinherited shall take his or her place and shall preserve the rights
of compulsory heirs with respect to the legitime; but the disinherited
ARTICLE 1021, NCC. Among the compulsory heirs the right of The father or mother of illegitimate children of the three classes
accretion shall take place only when the free portion is left to two or mentioned, shall inherit from them in the manner and to the extent
more of them, or to any one of them and to a stranger. established by this Code.
Should the part repudiated be the legitime, the other co-heirs shall They are compulsory heirs only in case of absence of legitimate children
succeed to it in their own right, and not by the right of accretion. or descendants of the decedent.
ARTICLE 969, NCC. If the inheritance should be repudiated by the Rule of proximity
nearest relative, should there be one only, or by all the nearest ARTICLE 972, NCC. The right of representation takes place in the
relatives called by law to succeed, should there be several, those of direct descending line, but never in the ascending.
the following degree shall inherit in their own right and cannot
represent the person or persons repudiating the inheritance. In the collateral line, it takes place only in favor of the children of
brothers or sisters, whether they be of the full or half blood.
 If one of the children is unwilling to accept the inheritance,
o his share in the legitime cannot go to his children by ARTICLE 890, para. 1, NCC. The legitime reserved for the legitimate
representation because “heirs who repudiate their share may parents shall be divided between them equally; if one of the parents
not be represented.” should have died, the whole shall pass to the survivor.
o His share of the legitime shall be distributed by intestacy to
the legal heirs of the testator. If the testator leaves neither father nor mother, but is survived by
o His share cannot accrue to the other children because the ascendants of equal degree of the paternal and maternal lines, the
right of accretion cannot take place with respect to the legitime shall be divided equally between both lines. If the
legitime. ascendants should be of different degrees, it shall pertain entirely to
o The rule will only be applicable if only one or some of the the ones nearest in degree of either line.
children repudiated their shares.
 In case all the children survive but all of them repudiated  Among the ascendants, the rule of proximity applies in
o their legitimes cannot go to their respective children by determining who shall be entitled to a legitime;
representation because heirs who repudiate their share may  In the ascending line, the rule applies absolutely because the law
not be represented. does not allow representation in the ascending line.
o The relatives next in degree, the grandchildren, shall  Situations:
inherit in their own right as compulsory heirs. o If both parents of the testator are living, the legitime
o Hence, the division of the estate shall be made per capita, or reserved for the legitimate parents shall be divided between
in equal portions, them equally.
o If one of the parents should have died, the whole legitime
(e) Adopted cannot be represented of the ascendants shall pass to the survivor.
o If the testator leaves neither father nor mother, but is
ARTICLE 973, NCC. In order that representation may take place, it survived by ascendants of equal degree of the paternal and
is necessary that the representative himself be capable of maternal lines, the legitime shall be divided equally
succeeding the decedent. between both lines.
o If the ascendants should be of different degrees, it shall
 If the child who died ahead of the testator, or who is disinherited or pertain entirely to the ones nearest in degree of either line.
incapacitated, is an adopted child, he may not be represented
by his descendants because the law requires the representative to 5. Concurring Compulsory Heirs
be capable of succeeding the decedent.
 In adoption, the descendants of the adopted are total strangers (a) Surviving spouse
to the adopter because the relationship established by adoption is (1) Void marriage
limited solely to the adopter and the adopted. (Teotico v. Del Val)  If the marriage is void, the parties are not actually
spouses and the surviving party is not entitled to the
4. Secondary Compulsory Heirs successional rights granted to a surviving spouse.
 A void marriage can still be questioned even after the
Legitimate parents or ascendants death of either party (Ninal v. Bayadog), and such issue
ARTICLE 887, NCC. The following are compulsory heirs: may be raised during the settlement of the estate of the
(1) Legitimate children and descendants, with respect to their deceased spouse. (Enrico v. Heirs of Sps. Medinaceli)
legitimate parents and ascendants; (2) Decree of legal separation
(2) In default of the foregoing, legitimate parents and ascendants,  In case a decree of legal separation is issued and it is
with respect to their legitimate children and descendants; the innocent spouse who died, the surviving spouse
(3) The widow or widower; (offending spouse) is disqualified to inherit from the
(4) Acknowledged natural children, and natural children by legal deceased in succession by operation of law. (63[4] FC)
fiction;  Hence, the surviving spouse is not a compulsory heir of
(5) Other illegitimate children referred to in article 287. the deceased spouse,
(b) Illegitimate children
Compulsory heirs mentioned in Nos. 3, 4 and 5 are not excluded by (1) Filiation must be established
those in Nos. 1 and 2; neither do they exclude one another. ARTICLE 176, FC. X
In all cases of illegitimate children, their filiation must be duly proved. ARTICLE 887, NCC. X
ARTICLE 175, FC. X  Only the parents of illegitimate children are entitled to legitime; the
other ascendants are excluded, even when the parents have
 Illegitimate children are compulsory heirs of their predeceased them.
parents; (176 FC) but only those who can duly establish  In illegitimate filiation, the right to succeed in the ascending line
their filiation with the decedent upon the latter’s death are terminates with the parents of the deceased illegitimate child.
entitled to successional rights. (Tolentino)
 An action to compel recognition may also be integrated  The other ascendants, like the grandparents, are no longer
with an action to claim inheritance. (Tayag v. CA) compulsory heirs.
 The two causes of action, one to compel recognition and
the other to claim inheritance, may be joined in one 7. Amount of Legitime
complaint.
(2) Illegitimate children may be represented (A) If Only One Class Survives
ARTICLE 902, NCC. The rights of illegitimate children set forth in the (a) General rule
preceding articles are transmitted upon their death to their
descendants, whether legitimate or illegitimate. ARTICLE 888, NCC. The legitime of legitimate children and
descendants consists of one-half of the hereditary estate of the father
ARTICLE 923, NCC. The children and descendants of the person and of the mother.
disinherited shall take his or her place and shall preserve the rights
of compulsory heirs with respect to the legitime; but the disinherited The latter may freely dispose of the remaining half, subject to the
parent shall not have the usufruct or administration of the property rights of illegitimate children and of the surviving spouse as
which constitutes the legitime. hereinafter provided.
ARTICLE 1035, NCC. If the person excluded from the inheritance by ARTICLE 889, NCC. The legitime of legitimate parents or
reason of incapacity should be a child or descendant of the decedent ascendants consists of one-half of the hereditary estates of their
and should have children or descendants, the latter shall acquire his children and descendants.
right to the legitime.
The children or descendants may freely dispose of the other half,
The person so excluded shall not enjoy the usufruct and subject to the rights of illegitimate children and of the surviving
administration of the property thus inherited by his children. spouse as hereinafter provided.
 Upon the death of the illegitimate child, his right to the ARTICLE 900, NCC. If the only survivor is the widow or widower, she
legitime is transmitted to his descendants, whether or he shall be entitled to one-half of the hereditary estate of the
legitimate or illegitimate. deceased spouse, and the testator may freely dispose of the other
 Hence, in case the illegitimate child predeceased his half.
illegitimate parent, he can be represented by his
descendants, whether they are legitimate or illegitimate, If the marriage between the surviving spouse and the testator was
with respect to his legitime. solemnized in articulo mortis, and the testator died within three
 The law also allows representation of the illegitimate months from the time of the marriage, the legitime of the surviving
child by his descendants in case of disinheritance (923) spouse as the sole heir shall be one-third of the hereditary estate,
and incapacity (1035). except when they have been living as husband and wife for more
than five years. In the latter case, the legitime of the surviving spouse
6. Estate of Illegitimate Decedent shall be that specified in the preceding paragraph.
ARTICLE 903, NCC. The legitime of the parents who have an ARTICLE 901, NCC. When the testator dies leaving illegitimate
illegitimate child, when such child leaves neither legitimate children and no other compulsory heirs, such illegitimate children
descendants, nor a surviving spouse, nor illegitimate children, is one- shall have a right to one-half of the hereditary estate of the deceased.
half of the hereditary estate of such illegitimate child. If only legitimate
or illegitimate children are left, the parents are not entitled to any The other half shall be at the free disposal of the testator.
legitime whatsoever. If only the widow or widower survives with
parents of the illegitimate child, the legitime of the parents is one- ARTICLE 903, NCC. The legitime of the parents who have an
fourth of the hereditary estate of the child, and that of the surviving illegitimate child, when such child leaves neither legitimate
spouse also one-fourth of the estate. descendants, nor a surviving spouse, nor illegitimate children, is one-
half of the hereditary estate of such illegitimate child. If only legitimate
When illegitimate parents become compulsory heirs or illegitimate children are left, the parents are not entitled to any
 If the testator is an illegitimate person and he is survived by a legitime whatsoever. If only the widow or widower survives with
descendant, whether legitimate or illegitimate, the illegitimate parents of the illegitimate child, the legitime of the parents is one-
parents are not compulsory heirs and they are not entitled to any fourth of the hereditary estate of the child, and that of the surviving
legitime whatsoever. spouse also one-fourth of the estate.
 Thus, the illegitimate parents of the decedent can only become
compulsory heirs,  When compulsory heir(s) of the same kind survive alone, without
o if surviving alone, or the concurrence of other kinds of compulsory heirs, the legitime is
o with the surviving spouse of the decedent. ½ of the hereditary estate (888, para. 1; 889, para. 1; 900; 901;
903);
Other illegitimate ascendants are not compulsory heirs  the other ½ is disposable free portion,
ARTICLE 889, NCC. The legitime of legitimate parents or

½ Legitime ascendants consists of one-half of the hereditary estates of their
½ Free Portion children and descendants.
(b) Exception The children or descendants may freely dispose of the other half,
 The legitime is not ½ but 1/3 of the hereditary estate, when: subject to the rights of illegitimate children and of the surviving
o the only surviving compulsory heir is the spouse and spouse as hereinafter provided.
o the marriage was in artictilo mortis
o but the spouse who was at the point of death at the time of the ARTICLE 893, NCC. If the testator leaves no legitimate descendants,
marriage died within 3 months from the celebration of the but leaves legitimate ascendants, the surviving spouse shall have a
marriage; right to one-fourth of the hereditary estate.
 the other 2/3 of the estate is disposable free portion,
This fourth shall be taken from the free portion of the estate.
1/3 Hereditary estate
2/3 Free portion ARTICLE 896, NCC. Illegitimate children who may survive with
legitimate parents or ascendants of the deceased shall be entitled to
(c) Exception to exception one-fourth of the hereditary estate to be taken from the portion at the
 The legitime of the surviving spouse is still 1/2 of the hereditary free disposal of the testator.
estate when, prior to the articulo mortis marriage, the parties lived
as husband and wife for more than five years. (900) ARTICLE 899, NCC. When the widow or widower survives with
legitimate parents or ascendants and with illegitimate children, such
(B) When Concurring Compulsory Heir (CH) Survives with surviving spouse shall be entitled to one-eighth of the hereditary
Legitimate Child/Descendant (LC/D) estate of the deceased which must be taken from the free portion,
(a) When LC/D survive with surviving spouse (SS) and the illegitimate children shall be entitled to one-fourth of the
 If there is only one LC, estate which shall be taken also from the disposable portion. The
o the legitime of the LC is ½; testator may freely dispose of the remaining one-eighth of the estate.
o SS: ¼
o the other ¼ is disposable free portion. (a) When LP/A survive with SS
 Several LCs o LP/A, ½ of hereditary estate;
o the legitime of the LCs is ½, to be divided equally among them; o SS, ¼
o SS is entitled to a portion equal to the legitime of each LC; o disposable free portion, ¼
o the remaining portion is disposable free portion (b) When LP/A survive with ILC
o LP/A, ½
(888, 892) o ILC, ¼
o disposable free portion, ¼
(b) When LC/D survive with illegitimate children/descendants (c) When LP/A survive with SS and ILC
(ILC/D) o LP/A, ½
 the legitime of LC is ½ of the hereditary estate, to be divided equally o SS, 1/8
between them; o ILC, ¼
 the legitime of each ILC is ½ of the share of each LC. o disposable free portion, 1/8
 If the estate is insufficient to satisfy the legitimes of all,
o the legitimes of the LC cannot be impaired. (D) When SS Survives with ILC
o The other ½ of the estate shall be divided equally among the o SS, 1/3
ILC. o ILC, 1/3
o Therefore, there is no disposable free portion, o disposable free portion, 1/3
(c) When LC/D survive with SS and ILC (E) When Illegitimate Parents (1LP) Survive with SS
ARTICLE 895, NCC. X  ILP, ¼
 SS, ¼
 Follow the rules mentioned above.  disposable free portion, ½
 However, if the hereditary estate is not sufficient to satisfy the
legitimes of all compulsory heirs: 8. Disposable Free Portion
o (1) the legitime of the legitimate children cannot be impaired;
and (a) Extent of disposable free portion
o (2) the legitime of the surviving spouse shall have preference ARTICLE 842, NCC. One who has no compulsory heirs may dispose
over those of the illegitimate children. by will of all his estate or any part of it in favor of any person having
 Hence, the remaining portion of the estate after capacity to succeed.
satisfying the legitimes of LC and SS shall be divided
equally among the ILC. One who has compulsory heirs may dispose of his estate provided
he does not contravene the provisions of this Code with regard to the
(C) When Concurring CH Survive with Legitimate legitime of said heirs.
Parents/Ascendants (LP/A)
ARTICLE 907, NCC. Testamentary dispositions that impair or
diminish the legitime of the compulsory heirs shall be reduced on
petition of the same, insofar as they may be inofficious or excessive.
 If the testator has no compulsory heirs, his entire estate is To the net value of the hereditary estate, shall be added the value of
disposable free portion. all donations by the testator that are subject to collation, at the time
 If he has compulsory heirs, what is left after satisfying the legitimes he made them.
of all compulsory heirs shall be the disposable free portion.
 Testamentary dispositions that impair or diminish the legitime of the (1) The value of the property which remains at the time of the
compulsory heirs shall be reduced on petition of the same, insofar decedent’s death shall be determined. If the decedent was married,
as they may be inofficious or excessive. (907) his property shall consist of his exclusive property and his share in
the net assets of the absolute community and conjugal property
(b) What may be done as to disposable free portion after liquidation;
ARTICLE 872, NCC. The testator cannot impose any charge, (2) All debts and charges which are not imposed in the will shall be
condition, or substitution whatsoever upon the legitimes prescribed deducted, and if the debt or charge arises for the first time from the
in this Code. Should he do so, the same shall be considered as not will itself as a unilateral act of the testator, it is non-deductible. The
imposed. difference between the assets and the liabilities shall then
constitute the net hereditary estate;
ARTICLE 904, NCC. The testator cannot deprive his compulsory (3) To the net value of the hereditary estate shall be added the value
heirs of their legitime, except in cases expressly specified by law. of all donations by the testator that are subject to collation, at the
time he made them, whether in favor of a compulsory heir or
Neither can he impose upon the same any burden, encumbrance, strangers, the value of which is determined at the time when the
condition, or substitution of any kind whatsoever. donations were made. The total value obtained after adding the
value of all donations to the net hereditary estate is the distributable
ARTICLE 1083, NCC. Every co-heir has a right to demand the estate, which is the basis for computing the free portion and the
division of the estate unless the testator should have expressly legitime:
forbidden its partition, in which case the period of indivision shall not (4) After the amount of the distributable estate has been determined,
exceed twenty years as provided in article 494. This power of the and the legitime and the free portion ascertained, donations which
testator to prohibit division applies to the legitime. had been brought to collation should next be imputed and charged
against the corresponding portion of the estate,
Even though forbidden by the testator, the co-ownership terminates
when any of the causes for which partnership is dissolved takes (b) Rules in imputation of donations
place, or when the court finds for compelling reasons that division ARTICLE 909, NCC. Donations given to children shall be charged to
should be ordered, upon petition of one of the co-heirs. their legitime.
 The testator may validly institute heirs (referred to as “voluntary Donations made to strangers shall be charged to that part of the
heirs”), devisees, or legatees only insofar as the disposable free estate of which the testator could have disposed by his last will.
portion is concerned. In addition, the testator may validly impose a
burden, charge, encumbrance, condition, or substitution only with Insofar as they may be inofficious or may exceed the disposable
respect to the disposable free portion. He cannot impose the same portion, they shall be reduced according to the rules established by
upon the legitime. (872, 904) this Code.
o Should he do so, the same shall be considered as not
imposed. ARTICLE 910, NCC. Donations which an illegitimate child may have
 The only encumbrance that he may validly impose upon the received during the lifetime of his father or mother, shall be charged
legitime is prohibition against partition for a period not exceeding to his legitime.
20 years.
Should they exceed the portion that can be freely disposed of, they
(c) Satisfy legitime first shall be reduced in the manner prescribed by this Code.
 In testamentary succession, the legitime of the compulsory heirs
must first be satisfied before the remaining portion of the estate can ARTICLE 911, NCC. After the legitime has been determined in
be distributed in accordance with the express will of the testator. accordance with the three preceding articles, the reduction shall be
 To illustrate, the testator left a will leaving his entire estate to “S,” made as follows:
his son, and to “B,” one of his five brothers. He also left a legacy of
P1 million to his friend, “F.” At the time of his death, his hereditary (1) Donations shall be respected as long as the legitime can be
estate was valued at PIO million. Here, satisfy first the legitime of covered, reducing or annulling, if necessary, the devises or
S, which is one-half of the estate, or P5 million. The remaining P5 legacies made in the will;
million is disposable free portion, out of which the legacy of Pl (2) The reduction of the devises or legacies shall be pro rata,
million to F will have to be satisfied. After satisfying the legacy to F, without any distinction whatever.
the remaining P4 million shall be divided equally between S and B,
as voluntary heirs. If the testator has directed that a certain devise or legacy be paid in
preference to others, it shall not suffer any reduction until the latter
9. Computation of Legitime have been applied in full to the payment of the legitime.
(a) Procedures (3) If the devise or legacy consists of a usufruct or life annuity,
ARTICLE 908, NCC. To determine the legitime, the value of the whose value may be considered greater than that of the
property left at the death of the testator shall be considered, disposable portion, the compulsory heirs may choose between
deducting all debts and charges, which shall not include those complying with the testamentary provision and delivering to the
imposed in the will. devisee or legatee the part of the inheritance of which the
testator could freely dispose.
ARTICLE 950, NCC. If the estate should not be sufficient to cover all
ARTICLE 752, NCC. The provisions of article 750 notwithstanding, the legacies or devises, their payment shall be made in the following
no person may give or receive, by way of donation, more than he order:
may give or receive by will. (1) Remuneratory legacies or devises;
(2) Legacies or devises declared by the testator to be preferential;
The donation shall be inofficious in all that it may exceed this (3) Legacies for support;
limitation. (4) Legacies for education;
(5) Legacies or devises of a specific, determinate thing which forms
ARTICLE 771, NCC. Donations which in accordance with the a part of the estate;
provisions of article 752, are inofficious, bearing in mind the (6) All others pro rata.
estimated net value of the donor’s property at the time of his death,
shall be reduced with regard to the excess; but this reduction shall I. Reserva Troncal or Reserva Lineal
not prevent the donations from taking effect during the life of the
donor, nor shall it bar the donee from appropriating the fruits. 1. Concept – Special Kind of Intestate Succession
For the reduction of donations the provisions of this Chapter and of ARTICLE 891, NCC. The ascendant who inherits from his
articles 911 and 912 of this Code shall govern. descendant any property which the latter may have acquired by
gratuitous title from another ascendant, or a brother or sister, is
ARTICLE 772, NCC. Only those who at the time of the donor’s death obliged to reserve such property as he may have acquired by
have a right to the legitime and their heirs and successors in interest operation of law for the benefit of relatives who are within the third
may ask for the reduction or inofficious donations. degree and who belong to the line from which said property came.
Those referred to in the preceding paragraph cannot renounce their The reservatario inherits from the prepositus by way of intestate
right during the lifetime of the donor, either by express declaration, or succession. However, it is a special kind of intestate succession for the
by consenting to the donation. following reasons:
(1) its purpose is to assure return of reservable property to the
The donees, devisees and legatees, who are not entitled to the third-degree relatives belonging to the line from which the
legitime and the creditors of the deceased can neither ask for the property originally came upon the happening of the resolutory
reduction nor avail themselves thereof. condition; (Mendoza v. Delos Santos)
(2) the property is not immediately inherited by the reservatario but
ARTICLE 773, NCC. If, there being two or more donations, the takes a “detour” through the reservista, thereby giving rise to the
disposable portion is not sufficient to cover all of them, those of the reservation before its transmission to the reservatario; (De Papa v.
more recent date shall be suppressed or reduced with regard to the Camacho)
excess. (3) while the reservatario inherits the property from the prepositus
upon the death of the reservista, the reservatario is not required to
(1) Donations given to be living at the time of the death of the prepositus; and
(a) compulsory heirs should be charged to their legitime. (4) in reserva troncal, not all relatives of the prepositus within the fifth
(b) strangers – shall be charged to that part of the estate which degree of relationship can inherit the reservable property but only
the testator could have disposed by his last will; the latter shall those within the third degree of relationship.
be reduced insofar as they are inofficious; (752, 771, 772)
(2) Donations shall be respected as long as the legitime can be 2. Three Lines of Transmission
covered, reducing, or annulling, if necessary, the devises or
legacies made in the will; (1) First transmission from Origin to Prepositus
(3) The reduction of the devises and legacies shall be pro rata, without  The origin is either an ascendant of the prepositus or his brother
any distinction whatever except when the testator has directed that or sister.
a certain devise or legacy be paid in preference to others; it shall  The prepositus, in turn, is a descendant of the origin or his brother
not suffer any reduction until after all others devises and legacies or sister.
have been applied in full to the payment of the legitime;  The mode of transmission is through gratuitous title.
(4) If, after annulling the legacies and devises, the legitimes cannot yet
be fully paid, then the donations must be reduced or annulled, as (2) Second transmission from Prepositus to Reservista
the case may be, annulling or reducing the more recent ones.  The reservista is another ascendant (not the origin) of the
prepositus.
 In case of concurrence of legitimes, donations inter vivos and  If the one who inherited from the prepositus is a collateral relative,
devises and legacies, the rule in Article 911 applies, there is no reserva troncal. (Mendoza)
o in which case, the devises and legacies shall be reduced pro  The mode of transmission is thru succession by operation of law
rata, without any distinction whatever. (either intestate succession or compulsory succession), meaning
 BUT when the question of preference is exclusively among the the reservista inherited from the prepositus either as a legal or
legatees and devises themselves, either because there is no compulsory heir.
compulsory heir or the testator has already provided in his will
sufficient property to cover the legitime, Article 950 NCC applies. (3) Third transmission from reservista to reservatario
o There is an order of preference to be followed under Article The reservatario inherits from the prepositus, not from the reservista, by
950 if the question of preference is exclusively among the way of intestate succession, if at the time of the death of the reservista
legacies and devises. the reservatario exists.
To be a reservatario;
(1) he must be a third-degree blood relative of the prepositus;
(2) he must come from the same bloodline where the property came  However, the reservable character of a property may be lost to
from, meaning, he must be a blood relative of the origin; and innocent purchasers for value. (Dizon v. Galang)
(3) among the various reservatarios, apply the rules of intestate o Hence, during the reservista’s lifetime, the reservatario can
succession to determine who shall inherit the property from the preserve his interest over the property by compelling the
piepositus. (Padura v. Baldovino) annotation of his right in the registry of property even
while the reservista is alive. (Gonzales)
ARTICLE 1009, NCC. Should there be neither brothers nor sisters, o In fact, in reserva troncal, the reservista has the duty to
nor children of brothers or sisters, the other collateral relatives shall reserve and to annotate the reservable character of the
succeed to the estate. property on the title.
 The reservista can dispose of the property by way of disposition
The latter shall succeed without distinction of lines or preference mortis causa, which is also subject to the same resolutory
among them by reason of relationship by the whole blood. condition. If the resolutory condition is fulfilled, the disposition
becomes ineffective because the property does not form part of the
 For example, if the surviving relatives of the prepositus are his estate of the reservista.
paternal uncle and a nephew, the latter shall exclude the former,
applying the rule in Article 1009 that the absence of brothers, J. Testamentary Succession: Rules Applicable to Disposable
sisters, nephews, and nieces of the decedent is a precondition to Free Portion
the other collaterals (uncles, cousins, etc.) being called to the
succession. (Abellana v. Ferraris) 1. Institution of Voluntary Heirs
3. Requisites of Reserva Troncal (a) Concept

ARTICLE 840, NCC. Institution of heir is an act by virtue of which a
In order that a property may be impressed with a reservable character testator designates in his will the person or persons who are to
the following requisites must exist: succeed him in his property and transmissible rights and obligations.
(1) that the property was acquired by a descendant from an ascendant
or from a brother or sister by gratuitous title; ARTICLE 841, NCC. A will shall be valid even though it should not
(2) that said descendant died without an issue (legitimate contain an institution of an heir, or such institution should not
descendants); comprise the entire estate, and even though the person so instituted
(3) that the property is inherited by another ascendant by operation of should not accept the inheritance or should be incapacitated to
law; and succeed.
(4) that there are relatives within the third degree belonging to the
line from which said property came. In such cases the testamentary dispositions made in accordance with
law shall be complied with and the remainder of the estate shall pass
Chua v. CFI of Negros Occidental to the legal heirs.
4. Rights of Reservista  The institution of heir is an act by virtue of which a testator

designates in his will the person or persons who are to
(a) Nature of interest of reservista succeed him in his property and transmissible rights and
 During his lifetime, the reservista is the owner of the reservable obligations.
property. (Mendoza, supra)  However, a will shall be valid even though it should not contain
 BUT his ownership is subject to a resolutory condition. an institution of heir or even if the institution does not comprise
o At the time of his death, there must be a living the entire estate.
reservatario. (Gonzales v. CFI)  If the will provides only for legacies or devises but no institution
o If the resolutory condition is not fulfilled, the property forms of heir, the remainder of the estate after payment of the legacies
part of the estate of the reservista upon his death. and devises shall pass to the legal heirs by intestate succession.
o If the resolutory condition is fulfilled, the property shall not  If the institution does not comprise the entire estate, the
form part of the estate of the reservista because it will be remainder of the estate shall pass to the legal heirs.
inherited by the reservatario from the prepositus by way of
intestate succession. (b) Designation of heir
 Reserva troncal is a case of delayed succession. (Gonzales v. CFI)
ARTICLE 843, NCC. The testator shall designate the heir by his
(b) Nature of interest of reservatario name and surname, and when there are two persons having the
During the lifetime of the reservista, the interest of the reservatario is same names, he shall indicate some circumstance by which the
merely inchoate. (Gonzales) instituted heir may be known.
(c) Disposition of property by reservista Even though the testator may have omitted the name of the heir,
 Since he is the owner of the property, he can dispose of the should he designate him in such manner that there can be no doubt
property by way of disposition inter vivos but the disposition as to who has been instituted, the institution shall be valid.
is subject to the same resolutory condition.
o If later on the resolutory condition is not fulfilled, the ARTICLE 844, NCC. An error in the name, surname, or
transferee’s title would become absolute. (Gonzales) circumstances of the heir shall not vitiate the institution when it is
o Upon the happening of the resolutory condition, the possible, in any other manner, to know with certainty the person
reservatario becomes, by operation of law, the owner of the instituted.
reservable property. (Mendoza)
o Hence, he may impugn any disposition inter vivos made by
the reservista in favor of a third person who acted in bad faith.
If among persons having the same names and surnames, there is a o This rule applies only to the disposable free portion.
similarity of circumstances in such a way that, even with the use of o Hence, if one of the voluntary heirs is also a compulsory heir,
other proof, the person instituted cannot be identified, none of them his legitime must first be satisfied and only the disposable free
shall be an heir. portion shall be distributed equally among the voluntary heirs.
 Example: Testator instituted as sole heirs to his entire estate his
Rule: The heir must be designated by his name and surname. son (S) and his brother (B). ½ of the estate shall be the legitime of
S and the remaining ½ of the estate shall be distributed equally
Effect of omission of name: The institution is still valid if the testator between S and B, in equal shares,
has designated the heir "in such a manner that there can be no doubt as
to who has been instituted. (e) Some individually designated, others collectively
ARTICLE 847, NCC. When the testator institutes some heirs
If two persons have same names individually and others collectively as when he says, “I designate as
 If two or more persons have the same names, the testator must my heirs A and B, and the children of C,” those collectively
indicate some circumstance by which the instituted heir may be designated shall be considered as individually instituted, unless it
known. clearly appears that the intention of the testator was otherwise.
 If among persons having the same names and surnames, there is
a similarity of circumstances in such a way that, even with the  When the testator institutes some heirs individually and others
use of other proof, the person instituted cannot still be identified, collectively as when he says "I designate as my heirs J and B and
none of them shall be an heir. the children of C. " those collectively designated (the children of C,
in the example) shall be considered as individually instituted,
Effect of error unless it clearly appears that the intention of the testator was
 An error in the name, surname, or circumstances of the heir shall otherwise.
not vitiate the institution when it is possible, in any other manner,  This rule applies only to the disposable free portion.
to know with certainty the person instituted. o Hence, if some of the voluntary heirs are also compulsory
 In other words, proof aliunde or extrinsic evidence (other than the heirs, their legitimes must first be satisfied and only the
oral declaration of the testator as to his intention) is admissible to disposable free portion shall be distributed in the manner
ascertain the intention of the testator. provided in Article 847.
o Example: The testator instituted as sole heirs to his entire
(c) Disposition in favor of unknown persons estate his children A, B, and C and the children of his
deceased child D. D has two children (E and F). Estate is P2
ARTICLE 845, NCC. Every disposition in favor of an unknown person million. The legitimes of the compulsory heirs should first be
shall be void, unless by some event or circumstance his identity satisfied. Hence, ½ of the estate or Pl million shall be divided
becomes certain. However, a disposition in favor of a definite class equally among A, B, C, and D, each getting P250,000 as their
or group of persons shall be valid. legitime. The share of D shall go to E and F, by representation,
each getting P125,000 as their legitime. The disposable free
ARTICLE 959, NCC. A disposition made in general terms in favor of portion P1 million shall be divided equally among A, B C, E,
the testator’s relatives shall be understood to be in favor of those and F pursuant to Article 847.
nearest in degree.
(f) Institution of brothers and sisters
GR: Every disposition in favor of an unknown person shall be void/
ARTICLE 848, NCC. If the testator should institute his brothers and
EXC sisters, and he has some of full blood and others of half blood, the
(1) If the identity can become certain by some event or circumstanc e, inheritance shall be distributed equally unless a different intention
the disposition is valid; however, the event or circumstance must appears.
appear in the will itself and it cannot be shown by extrinsic
evidence, either oral or documentary If the testator institutes his brothers and sisters, and he has some of full
(2) A disposition in favor of a definite class or group of persons blood and others of half-blood, the inheritance shall be distributed
shall be valid, provided that the testator already specifies the class equally, unless a different intention appears.
or cause and the specific property or amount of money to be given
to them (g) Instituting a person and the latter’s children
(3) A disposition in favor of the poor in general, without designation ARTICLE 849, NCC. When the testator calls to the succession a
of particular persons or of any community, shall be valid and shall person and his children they are all deemed to have been instituted
be understood to be in favor of the poor living in the locality simultaneously and not successively.
designated by the testator or, in the absence of such designation,
in favor of the poor living in the domicile of the testator at the time  When the testator calls to the succession a person and the
of his death. latter’s children, they are all deemed to have been instituted
(4) A disposition made in general terms in favor of the testator’s simultaneously and not successively, unless the contrary intention
relatives in the form of a legacy or devise is valid and shall be appears.
understood to be in favor of the testator’s nearest blood relatives.  As a consequence, they shall inherit in equal parts.
 For example, the testator instituted as sole heirs his brother, B, and
(d) Institution without designation of shares the latter’s children, and B has four children, all five of them shall
ARTICLE 846, NCC. X succeed in equal parts.
 If the heirs are instituted without designation of shares, they shall (h) Institution based on false cause
inherit in equal parts.
ARTICLE 850, NCC. The statement of a false cause for the institution (c) Effects of pretention
of an heir shall be considered as not written, unless it appears from
the will that the testator would not have made such institution if he Effects
had known the falsity of such cause.  Preterition shall annul entirely the institution of heirs, but the
legacies and devises remain valid insofar as they are not
GR: The institution is still valid and the false cause is considered as not inofficious. (854)
written.  Hence, if a will does not institute any devisees or legatees, the
preterition of a compulsory heir in the direct line will result in total
EXC: The institution shall be annulled if it appears from the will that the intestacy. (Morales)
testator would not have made such institution if he had known the falsity
of such cause. Distinguished from invalid disinheritance:
Invalid Disinheritance Preterition
Requisites for exception to apply Shall annul the institution of heirs
(1) cause for the institution of heirs must be stated in the will; insofar as it may prejudice the
(2) cause must be shown to be false; and person disinherited.
(3) it must appear from the face of the will that the testator would not
have made such institution if he had known the falsity of the cause. The nullity is limited to that
(Austria v. Reyes) portion of the estate of which the
disinherited heirs have been
2. Preterition illegally deprived.
Nuguid v. Nuguid
(a) Concept
 Preterition consists in the omission of a compulsory heir from  The omission of the surviving spouse in the will is not a case of
the will, either because preterition but a case of invalid disinheritance.
o he is not named or,
o although he is named as a father, son, etc., he is neither 3. Substitution of Heirs
instituted as an heir nor assigned any part of the estate without
expressly being disinherited—tacitly depriving the heir of his There are two kinds of substitution: simple and fideicommissary.
legitime. (Morales v. Olondriz)
 Preterition is a concept of testamentary succession and requires a (A) Simple substitution:
will. (Heirs of Policarpio Ureta v. Heirs of Liberato Ureta) ARTICLE 857, NCC. Substitution is the appointment of another heir
so that he may enter into the inheritance in default of the heir
(b) Requisites originally instituted.
ARTICLE 854, NCC. The preterition or omission of one, some, or all
of the compulsory heirs in the direct line, whether living at the time of Definition: It is the appointment of another heir so that he may enter into
the execution of the will or born after the death of the testator, shall the inheritance in default of the heir originally instituted.
annul the institution of heir; but the devises and legacies shall
be valid insofar as they are not inofficious. Variations
ARTICLE 860, NCC. Two or more persons may be substituted for
If the omitted compulsory heirs should die before the testator, the one; and one person for two or more heirs.
institution shall be effectual, without prejudice to the right of
representation. ARTICLE 862, NCC. The substitute shall be subject to the same
charges and conditions imposed upon the instituted heir, unless the
(1) The heir omitted must be a compulsory heir in the direct line, testator has expressly provided the contrary, or the charges or
whether ascending or descending. conditions are personally applicable only to the heir instituted.
(a) The omission of any compulsory heir, UB (Acain v. IAC), is
preterition because all compulsory heirs are in the direct line, (1) Brief - when two or more persons are designated by the testator to
including substitute for only one heir;
(i) an adopted child (Acain) (2) Compendious - when there is only one person designated to
(ii) an illegitimate child (Morales) substitute for two or more heirs; or
(iii) a conceived child (Quimiguing v Icao) and (3) Reciprocal - when two or more persons are reciprocally substitutes
(iv) legitimate ascendants; (Nuguid v. Nuguid) for each other, the substitution is called reciprocal.
(2) there must be total or complete omission – meaning:
(a) the heir did not also receive any legacies, devises, or When simple substitution takes place - RIP
advances on his legitime (Morales) or ARTICLE 859, NCC. The testator may designate one or more
(b) the testator allotted to a descendant a share less than the persons to substitute the heir or heirs instituted in case such heir or
legitime since there was no total omission of a forced heir, heirs should die before him, or should not wish, or should be
(JLT Agro v. Balansag) or incapacitated to accept the inheritance.
(c) the testamentary dispositions do not cover the entire estate
and something has been left undisposed of (Tolentino) A simple substitution, without a statement of the cases to which it
(3) the omitted compulsory heir must survive the testator, unless he refers, shall comprise the three mentioned in the preceding
can be represented by his descendant; and paragraph, unless the testator has otherwise provided.
(4) the omission of a compulsory heir in the will must be by mistake,
inadvertence, or through an oversight, and not intentional, (1) predecease;
otherwise it will be a case of invalid disinheritance.
(2) repudiation; or
(3) incapacity. (4) Those which leave to a person the whole or part of the
If the simple substitution is without a statement of the cases to which it hereditary property in order that he may apply or invest the
refers, the same shall comprise the three cases mentioned above same according to secret instructions communicated to him by
(incapacity, predecease, or renunciation), unless the testator has the testator.
otherwise provided.
(1) It must be expressly made – either by giving it such name, or by
Effects of simple substitution imposing upon the first heir (fiduciary) the absolute obligation to
The substitute is subject to the same charges and conditions imposed deliver the inheritance to a second heir (fideicommissary);
upon the instituted heir, unless: (2) the substitution must not go beyond one degree from the
(1) the testator has expressly provided in the will the contrary; or fiduciary – meaning, the second heir must be related to and be
(2) the charges or conditions are personally applicable only to the heir one generation from the first heir (Ramirez v. Vda. De Ramirez);
instituted. (862) hence, the fideicommissary heir can only be either a parent or a
child of the fiduciary heir for they are the only relatives who are one
(B) Fideicommissarv substitution generation or degree from the fiduciary;
ARTICLE 863, NCC. A fideicommissary substitution by virtue of (3) the fiduciary and the fideicommissary heirs must be living at the
which the fiduciary or first heir instituted is entrusted with the time of the death of the testator; and
obligation to preserve and to transmit to a second heir the whole or (4) the substitution must not burden the legitime.
part of the inheritance, shall be valid and shall take effect, provided
such substitution does not go beyond one degree from the heir Effects of invalid FS
originally instituted, and provided further, that the fiduciary or first heir ARTICLE 868, NCC. The nullity of the fideicommissary substitution
and the second heir are living at the time of the death of the testator. does not prejudice the validity of the institution of the heirs first
designated; the fideicommissary clause shall simply be considered
Concept: In a fideicommissary substitution (FS), the first heir is strictly as not written.
mandated to preserve the property and to transmit the same later to the
second heir.  The fideicommissary substitution clause is considered as not
written or not imposed
Requisites for substitution to become fideicommissarv:  the validity of the institution of the first heir (the fiduciary) is not
(1) A first heir (known as the “fiduciary heir”) called primarily to the affected.
enjoyment of the estate;
(2) a second heir (called the “fideicommissary heir”) to whom the Effects of valid FS
property is transmitted by the first heir; and ARTICLE 863, NCC. A fideicommissary substitution by virtue of
(3) an obligation clearly imposed upon the first heir to preserve and which the fiduciary or first heir instituted is entrusted with the
transmit to the second heir the whole or part of the estate. obligation to preserve and to transmit to a second heir the whole or
(De Perez v, Garchitorena) part of the inheritance, shall be valid and shall take effect, provided
such substitution does not go beyond one degree from the heir
Requisites for validity of FS originally instituted, and provided further, that the fiduciary or first heir
ARTICLE 863, NCC. A fideicommissary substitution by virtue of and the second heir are living at the time of the death of the testator.
which the fiduciary or first heir instituted is entrusted with the
obligation to preserve and to transmit to a second heir the whole or ARTICLE 866, NCC. The second heir shall acquire a right to the
part of the inheritance, shall be valid and shall take effect, provided succession from the time of the testator’s death, even though he
such substitution does not go beyond one degree from the heir should die before the fiduciary. The right of the second heir shall pass
originally instituted, and provided further, that the fiduciary or first heir to his heirs.
and the second heir are living at the time of the death of the testator.
 Upon the death of the testator,
ARTICLE 864, NCC. A fideicommissary substitution can never o the first heir (fiduciary) acquires only the right of usufruct
burden the legitime. o while the second heir (fideicommissary) acquires the naked
ownership. (Crisologo v. Singson)
ARTICLE 865, NCC. Every fideicommissary substitution must be  Thus, the fiduciary is obliged to preserve and to transmit the
expressly made in order that it may be valid. property to the fideicommissary.
 The fideicommissary heir does not succeed the fiduciary for he
The fiduciary shall be obliged to deliver the inheritance to the second acquires his right directly from the testator upon the latter’s death.
heir, without other deductions than those which arise from legitimate o Thus, even if he should die before the fiduciary, his right
expenses, credits and improvements, save in the case where the simply passes to his heirs.
testator has provided otherwise.  Since the fideicommissary is already the naked owner of the
property upon the death of the testator, he can validly dispose of
ARTICLE 867, NCC. The following shall not take effect: the property even during the lifetime of the fiduciary provided that
(1) Fideicommissary substitutions which are not made in an the disposition should not impair the usufructuary right of the
express manner, either by giving them this name, or imposing fiduciary,
upon the fiduciary the absolute obligation to deliver the property
to a second heir; Prohibition against alienation
(2) Provisions which contain a perpetual prohibition to alienate, and ARTICLE 870, NCC. The dispositions of the testator declaring all or
even a temporary one, beyond the limit fixed in article 863; part of the estate inalienable for more than twenty years are void.
(3) Those which impose upon the heir the charge of paying to
various persons successively, beyond the limit prescribed in
article 863, a certain income or pension;
ARTICLE 904, para. 2, NCC. The testator cannot deprive his

compulsory heirs of their legitime, except in cases expressly (1) There are two or more voluntary heirs, devisees, or legatees
specified by law. who are called to the same inheritance, same portion or same
property; and
Neither can he impose upon the same any burden, encumbrance, (2) there is a vacancy in the inheritance as a result of predecease,
condition, or substitution of any kind whatsoever. incapacity, or repudiation. (PRI)
 The law allows the testator to prohibit the alienation of the  The words “one-half for each " or "in equal shares" or any other
inheritance (pertaining to the disposable free portion) for a period parts which, though designating an aliquot part, do not identify it by
not exceeding 20 years. such description as shall make each heir the exclusive owner of
 If the prohibition exceeds 20 years, it will be considered valid only determinate property, shall not exclude the right of accretion.
for 20 years but invalid as to the excess. (Rodriguez v. CA)  In case of money or fungible goods, if the share of each heir is not
 The same prohibition cannot be imposed upon the legitime. earmarked, there shall be a right of accretion.
 When the right of accretion cannot take place with respect to the
4. Accretion in Testamentary Succession (RIP) disposable free portion, the vacant portion of the instituted HDLs,
if no substitute has been designated, shall pass to the legal
Concept heirs of the testator, who shall receive it with the same charges
ARTICLE 1015, NCC. Accretion is a right by virtue of which, when and obligations.
two or more persons are called to the same inheritance, devise or
legacy, the part assigned to the one who renounces or cannot receive How co-heirs, co-devisees, or co-legatees divide the vacant share
his share, or who died before the testator, is added or incorporated ARTICLE 1019, NCC. The heirs to whom the portion goes by the
to that of his co-heirs, co-devisees, or co-legatees. right of accretion take it in the same proportion that they inherit.
Accretion is a right by virtue of which, when two or more persons are In accretion, the heirs to whom the portion goes take it in the same
called to the same inheritance, devise, or legacy, the part assigned proportion that they inherit.
to the one who renounces or cannot receive his share, or who died
before the testator, is added or incorporated to that of his coheirs, co- 5. Condition, Mode, and Term
devisees, or co-legatees.
(a) Power to impose condition, mode or term
Accretion in testamentary succession ARTICLE 871, NCC. The institution of an heir may be made
ARTICLE 1021, NCC. Among the compulsory heirs the right of conditionally, or for a certain purpose or cause.
accretion shall take place only when the free portion is left to two or
more of them, or to any one of them and to a stranger. ARTICLE 872, NCC. The testator cannot impose any charge,
Should the part repudiated be the legitime, the other co-heirs shall in this Code. Should he do so, the same shall be considered as not
succeed to it in their own right, and not by the right of accretion. imposed.
 Accretion cannot take place with respect to the legitime. ARTICLE 904, NCC. The testator cannot deprive his compulsory
 Instead, accretion can only take place with respect to the heirs of their legitime, except in cases expressly specified by law.
disposable free portion, either by
o express will of the testator or Neither can he impose upon the same any burden, encumbrance,
o operation of law. condition, or substitution of any kind whatsoever.
Requisites for accretion by operation of law with respect to DFP ARTICLE 1083, NCC. Every co-heir has a right to demand the
ARTICLE 1016, NCC. In order that the right of accretion may take division of the estate unless the testator should have expressly
place in a testamentary succession, it shall be necessary: forbidden its partition, in which case the period of indivision shall not
(1) That two or more persons be called to the same inheritance, or exceed twenty years as provided in article 494. This power of the
to the same portion thereof, pro indiviso; and testator to prohibit division applies to the legitime.
(2) That one of the persons thus called die before the testator, or
renounce the inheritance, or be incapacitated to receive it. Even though forbidden by the testator, the co-ownership terminates
when any of the causes for which partnership is dissolved takes
ARTICLE 1017, NCC. The words “one-half for each” or “in equal place, or when the court finds for compelling reasons that division
shares” or any others which, though designating an aliquot part, do should be ordered, upon petition of one of the co-heirs.
not identify it by such description as shall make each heir the
exclusive owner of determinate property, shall not exclude the right  The testator is free to impose any condition, mode or term on
of accretion. testamentary dispositions, whether the same is an institution of
heir, or a devise or a legacy.
In case of money or fungible goods, if the share of each heir is not o This applies only to the disposable free portion because
earmarked, there shall be a right of accretion. the testator is prohibited from imposing upon the legitime any
burden, encumbrance, charge, term, condition, or substitution
ARTICLE 1022, NCC. In testamentary succession, when the right of of any kind whatsoever.
accretion does not take place, the vacant portion of the instituted o Should he do so, the same is to be considered as not
heirs, if no substitute has been designated, shall pass to the legal imposed.
heirs of the testator, who shall receive it with the same charges and  There is only one exceptional encumbrance which the testator can
obligations. validly impose upon the legitime—he can forbid the partition of
the inheritance, including the legitime, for not more than 20  If the condition is fulfilled, the instituted HDL loses his right over the
years. inheritance and the same shall be passed on to those who are
legally entitled to it—
(b) Conditional testamentary disposition o the substitute (if one is provided), or
When the acquisition or extinguishment of successional rights is made o the co-heir with a right of accretion or the legal heirs, as the
to depend upon the happening or non-happening of a future and case may be.
uncertain event, the testamentary disposition is conditional.
(3) Potestative condition
(1) Suspensive condition ARTICLE 876, NCC. Any purely potestative condition imposed upon
ARTICLE 1181, NCC. In conditional obligations, the acquisition of an heir must be fulfilled by him as soon as he learns of the testator’s
rights, as well as the extinguishment or loss of those already death.
acquired, shall depend upon the happening of the event which
constitutes the condition. This rule shall not apply when the condition, already complied with,
cannot be fulfilled again.
ARTICLE 1187, NCC. The effects of a conditional obligation to give,
once the condition has been fulfilled, shall retroact to the day of the ARTICLE 879, NCC. If the potestative condition imposed upon the
constitution of the obligation. Nevertheless, when the obligation heir is negative, or consists in not doing or not giving something, he
imposes reciprocal prestations upon the parties, the fruits and shall comply by giving a security that he will not do or give that which
interests during the pendency of the condition shall be deemed to has been prohibited by the testator, and that in case of contravention
have been mutually compensated. If the obligation is unilateral, the he will return whatever he may have received, together with its fruits
debtor shall appropriate the fruits and interests received, unless from and interests.
the nature and circumstances of the obligation it should be inferred
that the intention of the person constituting the same was different. ARTICLE 880, NCC. If the heir be instituted under a suspensive
condition or term, the estate shall be placed under administration until
In obligations to do and not to do, the courts shall determine, in each the condition is fulfilled, or until it becomes certain that it cannot be
case, the retroactive effect of the condition that has been complied fulfilled, or until the arrival of the term.
with.
The same shall be done if the heir does not give the security required
ARTICLE 884, NCC. Conditions imposed by the testator upon the in the preceding article.
heirs shall be governed by the rules established for conditional
obligations in all matters not provided for by this Section.  When the fulfillment of the condition depends exclusively upon
the will of the HDL and must be performed by him personally.
ARTICLE 1034, NCC. In order to judge the capacity of the heir,  A purely potestative condition must be fulfilled after the testator’s
devisee or legatee, his qualification at the time of the death of the death as soon as the HDL learns of the testator’s death.
decedent shall be the criterion.
This rule does not apply if the following requisites are present:
In cases falling under Nos. 2, 3, or 5 of article 1032, it shall be (1) the condition was already complied with at the time he learns
necessary to wait until final judgment is rendered, and in the case of the testator’s death; and
falling under No. 4, the expiration of the month allowed for the report. (2) the condition is of such a nature that it cannot be fulfilled again.
If the institution, devise or legacy should be conditional, the time of  If the potestative condition consists in not doing or not giving
the compliance with the condition shall also be considered. something, the instituted HDL is entitled to the immediate
delivery of the property after the testator’s death upon giving of a
 Successional rights are transmitted only upon the happening of security or bond, known as caucion muciana.
the condition, although the effects thereof retroact to the moment  If the required security or bond is not given, the property shall
of the testator’s death. be placed under administration and shall remain therein until the
o Hence, the capacity of the conditional heir, devisee, or legatee security is given.
must be determined at the time of the testator’s death AND  If the condition is violated, the HDL must return the property,
at the time of the happening of the condition. together with the fruits and interest in favor of those who are legally
o Consequently, if the HDL dies before the happening of the entitled to it—the substitute (if one is provided), or the co-heir with
condition, although he dies after the testator’s death, his a right of accretion or the legal heirs, as the case may be. In case
capacity to succeed terminates and thus renders the the property or its fruits and interest cannot be returned, the
testamentary disposition inoperative and without effect. security shall have to answer for the liability.
(2) Resolutory condition (4) Casual and mixed condition

ARTICLE 1181, NCC. In conditional obligations, the acquisition of ARTICLE 877, NCC. If the condition is casual or mixed, it shall be
rights, as well as the extinguishment or loss of those already sufficient if it happen or be fulfilled at any time before or after the
acquired, shall depend upon the happening of the event which death of the testator, unless he has provided otherwise.
constitutes the condition.
Should it have existed or should it have been fulfilled at the time the
 Successional rights are acquired immediately upon the death of will was executed and the testator was unaware thereof, it shall be
the testator but subject to extinction upon the happening of the deemed as complied with.
condition.
If he had knowledge thereof, the condition shall be considered  Such disposition is void, but the validity of the other provisions,
fulfilled only when it is of such a nature that it can no longer exist or including the will itself, shall not be affected.
be complied with again.
(c) Testamentary dispositions with term:
 A casual condition is one whose fulfillment depends exclusively ARTICLE 878, NCC. A disposition with a suspensive term does not
upon chance and/or upon the will of a third person. prevent the instituted heir from acquiring his rights and transmitting
 A mixed condition is partly dependent upon the will of the HDL them to his heirs even before the arrival of the term.
and partly upon chance and/or the will of a third person.
 As a rule, a casual or mixed condition is deemed fulfilled if the (1) Suspensive term
condition already occurs, whether before or after the testator’s  The successional right is immediately transmitted to the heir,
death, unless the testator provides otherwise. devisee, or legatee upon the death of the testator, although the
o If at the time of the execution of the will, the condition is demandability of such right is suspended until the arrival of the
already fulfilled and the testator is unaware thereof, the day certain designated by the testator.
condition is deemed complied with already.  As a consequence, even if the HDL should die before the term
o However, if the testator had knowledge that the condition arrives but he dies after the death of the testator, his own heirs
is already fulfilled at the time of the execution of the will, the are entitled to succeed to his rights to the inheritance, which must
condition must be fulfilled again unless it is of such nature be delivered to them upon the arrival of the term.
that it can no longer exist or be complied with again.
(2) Resolutory term
(5) Effect of impossible condition  The heir, devisee, or legatee can demand immediately for the
ARTICLE 873, NCC. Impossible conditions and those contrary to law delivery of the inheritance, devise, or legacy subject to the
or good customs shall be considered as not imposed and shall in no termination of his right upon arrival of the term.
manner prejudice the heir, even if the testator should otherwise  Upon arrival of the term, the inheritance, devise, or legacy shall
provide. pass to the legal heirs of the testator.
 Impossible conditions and those contrary to law or good (d) Modal testamentary disposition
customs in testamentary dispositions ARTICLE 882, NCC. The statement of the object of the institution, or
o shall be considered as not imposed and the application of the property left by the testator, or the charge
o shall not affect the validity of the dispositions. imposed by him, shall not be considered as a condition unless it
 The same rule applies even if the testator provides the contrary. appears that such was his intention.
(i) Prohibition to marry That which has been left in this manner may be claimed at once
ARTICLE 874, NCC. An absolute condition not to contract a first or provided that the instituted heir or his heirs give security for
subsequent marriage shall be considered as not written unless such compliance with the wishes of the testator and for the return of
condition has been imposed on the widow or widower by the anything he or they may receive, together with its fruits and interests,
deceased spouse, or by the latter’s ascendants or descendants. if he or they should disregard this obligation.
Nevertheless, the right of usufruct, or an allowance or some personal  A "mode " imposes an obligation upon the HDL, but it does not
prestation may be devised or bequeathed to any person for the time affect the efficacy of his rights to the succession. (Rabadilla v. CA)
during which he or she should remain unmarried or in widowhood.  If the institution of HDL is modal, the latter can claim immediate
delivery of the inheritance subject to the giving of security or
ARTICLE 875, NCC. Any disposition made upon the condition that bond for the compliance with the obligation.
the heir shall make some provision in his will in favor of the testator o If the security or bond is not given, the HDL may not
or of any other person shall be void. demand for the delivery of the inheritance because the same
is a condition sine qua non for its delivery.
 As a rule, an absolute condition not to contract a first or o In case of failure to comply with the mode or obligation,
subsequent marriage is not a valid condition and shall be the HDL shall be compelled to return whatever he may have
considered as not written. received by virtue of the institution or of the devise or legacy,
 EXC: the prohibition to contract a subsequent marriage is valid together with the fruits or interests.
if it is imposed on the widow or widower by the deceased o In case he cannot, the bond or security can be made to
spouse or by the latter’s ascendants or descendants, in which answer for any deficiency.
case, the condition is valid.
o But the prohibition can only be imposed upon the 6. Legacies and Devises
disposable free portion, not the legitime.
 If the prohibition to marry is not absolute but relative with respect Concept
to persons, time, or place, such condition is valid and must be ARTICLE 782, NCC. The statement of the object of the institution, or
complied with unless the testator practically renders it impossible the application of the property left by the testator, or the charge
for the heir to marry at all. imposed by him, shall not be considered as a condition unless it
 A prohibition to marry someone is a valid condition and must be appears that such was his intention.
complied with unless its performance becomes impossible.
That which has been left in this manner may be claimed at once
(ii) Disposition cantatoria provided that the instituted heir or his heirs give security for
 A disposition captatoria is one which imposes as condition that compliance with the wishes of the testator and for the return of
the heir shall make some provision in his will in favor of the anything he or they may receive, together with its fruits and interests,
testator or of any other person. if he or they should disregard this obligation.
(2) there must be knowledge on the part of the testator that the thing
 Devises are gifts of real property given by virtue of a will. belongs partly to a third person; otherwise, the legacy or devise is
 Legacies are gifts of personal property given by will. void.
 In legacies and devises, specific properties are given by will and
not an aliquot part of the estate, (c) If thing already belonged to legatee or devisee
ARTICLE 932, NCC. The legacy or devise of a thing which at the
(a) If thing belongs to another time of the execution of the will already belonged to the legatee or
(1) And testator erroneously believed it was his devisee shall be ineffective, even though another person may have
ARTICLE 930, NCC. The legacy or devise of a thing belonging to some interest therein.
another person is void, if the testator erroneously believed that the
thing pertained to him. But if the thing bequeathed, though not If the testator expressly orders that the thing be freed from such
belonging to the testator when he made the will, afterwards becomes interest or encumbrance, the legacy or devise shall be valid to that
his, by whatever title, the disposition shall take effect. extent.
 If, at the time of the execution of the will, the testator ARTICLE 930, NCC. X
erroneously believed that the thing belonged to him,
the legacy or devise is void. ARTICLE 933, NCC. If the thing bequeathed belonged to the legatee
 But if afterwards, the thing is acquired by the testator by or devisee at the time of the execution of the will, the legacy or devise
whatever title, the devise or legacy becomes valid. shall be without effect, even though it may have subsequently
alienated by him.
(2) And testator was aware it was not his
ARTICLE 931, NCC. If the testator orders that a thing belonging to If the legatee or devisee acquires it gratuitously after such time, he
another be acquired in order that it be given to a legatee or devisee, can claim nothing by virtue of the legacy or devise; but if it has been
the heir upon whom the obligation is imposed or the estate must acquired by onerous title he can demand reimbursement from the
acquire it and give the same to the legatee or devisee; but if the heir or the estate.
owner of the thing refuses to alienate the same, or demands an
excessive price therefor, the heir or the estate shall only be obliged (1) If, at the time of the execution of the will, the thing already belonged
to give the just value of the thing. to the legatee or devisee, the legacy or devise shall be ineffective.
(2) If, at the time of the execution of the will, the thing did not belong to
o If the testator knew that the thing did not belong to him, the legatee or devisee but he subsequently acquires it, the rules
the legacy or devise is valid. are as follows:
o Even if the thing belonged to another, the testator may, in (a) If the thing originally belonged to a third person at the time
his will, order that the thing be acquired in order that it be of the execution of the will and the testator did not know of
given to a legatee or devisee. such fact, the legacy or devise is void, and it continues to be
 If the testator did not expressly order for its void, even if the legatee or devisee subsequently acquires it
acquisition, the legacy or devise is still valid because it by any title;"’
is presumed that it was his intention that such thing be (b) If the thing originally belonged to a third person at the time
acquired. of the execution of the will and the testator knew of such
 The obligation to acquire may be imposed upon a fact, the legatee or devisee can demand reimbursement
particular HDL. from the heir or the estate if he acquired it thru onerous title,
 In the absence of express designation, such obligation but he can claim nothing by virtue of the legacy or devise if he
rests upon the executor or administrator. acquired it gratuitously.
o If the thing cannot be acquired for whatever reason, the
legacy or devise remains valid and the heir or estate, as the Rule of preference among legacies and devisees
case may be, shall be obliged to give the just value of the ARTICLE 950, NCC. If the estate should not be sufficient to cover all
thing. the legacies or devises, their payment shall be made in the following
order:
(b) If thing is only partly owned by testator (1) Remuneratory legacies or devises;
ARTICLE 929, NCC. If the testator, heir, or legatee owns only a part (2) Legacies or devises declared by the testator to be preferential;
of, or an interest in the thing bequeathed, the legacy or devise shall (3) Legacies for support;
be understood limited to such part or interest, unless the testator (4) Legacies for education;
expressly declares that he gives the thing in its entirety. (5) Legacies or devises of a specific, determinate thing which forms
a part of the estate;
(1) RULE: If the testator, heir, or legatee owns only a part of or an (6) All others pro rata.
interest in the thing bequeathed, the legacy or devise shall be
understood to be limited to such part or interest. When the question of preference is exclusively among the legatees and
(2) EXC: devisees themselves and the estate is not sufficient to cover all the
(a) Unless it clearly appears from the will that the testator legacies or devises, their payment shall be made in the following order:
intended to convey a less interest or (1) remuneratory legacies or devises;
(b) the testator expressly declares that he bequeaths or (2) legacies or devises declared by the testator to be preferential;
devises the thing in its entirety. (3) legacies for support;
(4) legacies for education;
For the latter exception to apply, the following requisites must be (5) legacies or devises of a specific, determinate thing which forms part
present: of the estate; and
(1) there must be an express declaration to that effect appearing in (6) all others pro rata.
the will itself; and
In case of concurrence of legitimes, donations inter vivos and

devises and legacies, the rule of preference in Article 911 is the one  Death extinguishes civil personality (42 NCC)
applicable, as follows:  As a rule, therefore, a successor who dies before the decedent
(1) donations shall be respected as long as the legitime can be does not acquire any successional right and transmits nothing to
covered, reducing or annulling, if necessary, the devises or his own heirs, unless the right of representation takes place.
legacies made in the will; (b) Effect in succession by will
(2) the reduction of the devises or legacies shall be pro rata,  A voluntary HDL who dies before the testator absolutely transmits
without any distinction whatever. nothing to his heirs, because the right of representation does not
(a) However, if the testator has directed that a certain devise or apply to the disposable free portion.
legacy be paid in preference to others, it shall not suffer any  In case of vacancy, what may apply to the disposable free portion
reduction until the latter have been applied in full to the in the order of applicability are the following:
payment of the legitime, (a) substitution;
(b) accretion; or
Revocation of legacy or devise by operation of law: (c) intestate succession,
ARTICLE 957, NCC. The legacy or devise shall be without effect:
(1) If the testator transforms the thing bequeathed in such a manner (c) Effect in succession by operation of law
that it does not retain either the form or the denomination it had;
(2) If the testator by any title or for any cause alienates the thing (1) If no representative
bequeathed or any part thereof, it being understood that in the  If the heir (compulsory or legal heir) dies without leaving a
latter case the legacy or devise shall be without effect only with representative, he is no longer counted as an heir because his
respect to the part thus alienated. If after the alienation the thing death extinguishes his civil personality. (43 NCC)
should again belong to the testator, even if it be by reason of  To illustrate: D, the decedent, had three children (A. B. and C) but
nullity of the contract, the legacy or devise shall not thereafter A predeceased D and he did not leave any descendant. The
be valid, unless the reacquisition shall have been effected by legitime will only be divided between B and C.
virtue of the exercise of the right of repurchase;
(3) If the thing bequeathed is totally lost during the lifetime of the (2) If representation takes place
testator, or after his death without the heir’s fault. Nevertheless, ARTICLE 992, NCC. An illegitimate child has no right to inherit ab
the person obliged to pay the legacy or devise shall be liable for intestato from the legitimate children and relatives of his father or
eviction if the thing bequeathed should not have been mother; nor shall such children or relatives inherit in the same
determinate as to its kind, in accordance with the provisions of manner from the illegitimate child.
article 928.
ARTICLE 902, NCC. The rights of illegitimate children set forth in the
ARTICLE 928, NCC. The heir who is bound to deliver the legacy or preceding articles are transmitted upon their death to their
devise shall be liable in case of eviction, if the thing is indeterminate descendants, whether legitimate or illegitimate.
and is indicated only by its kind.
ARTICLE 990, NCC. The hereditary rights granted by the two
(1) If the testator transforms the thing bequeathed in such a manner preceding articles to illegitimate children shall be transmitted upon
that it does not retain either the form or the denomination it had; their death to their descendants, who shall inherit by right of
(2) If the testator by any title or for any cause alienates the thing representation from their deceased grandparent.
bequeathed or any part thereof, it being understood that in the latter
case the legacy or devise shall be without effect only with respect
ARTICLE 1003, NCC. If there are no descendants, ascendants,
to the part thus alienated.
illegitimate children, or a surviving spouse, the collateral relatives
(a) If after the alienation the thing should again belong to the
shall succeed to the entire estate of the deceased in accordance with
testator, even if it be by reason of nullity of the contract, the
the following articles.
legacy or devise shall not thereafter be valid, unless the
reacquisition shall have been effected by virtue of the
ARTICLE 1009, NCC. Should there be neither brothers nor sisters,
exercise of the right of repurchase.
nor children of brothers or sisters, the other collateral relatives shall
(3) If the thing bequeathed is totally lost during the lifetime of the
succeed to the estate.
testator, or after his death without the heir’s fault.
(a) BUT the person obliged to pay the legacy or devise shall be
The latter shall succeed without distinction of lines or preference
liable for eviction if the thing bequeathed should not have
among them by reason of relationship by the whole blood.
been determinate as to its kind, in accordance with the
provisions of Article 928 NCC.
ARTICLE 975, NCC. When children of one or more brothers or
K. Vacancies in Succession sisters of the deceased survive, they shall inherit from the latter by
representation, if they survive with their uncles or aunts. But if they
1. Predecease alone survive, they shall inherit in equal portions.
(a) Effect of death of successors  A legitimate child of the decedent may only be represented by
ARTICLE 856, NCC. A voluntary heir who dies before the testator a legitimate descendant, but not by his illegitimate descendants
transmits nothing to his heirs. because of the barrier rule which prohibits the illegitimate children
from inheriting ab intestato from the estate of the legitimate
A compulsory heir who dies before the testator, a person relatives of their parents.
incapacitated to succeed, and one who renounces the inheritance,  In the same way, an adopted child of the decedent may not be
shall transmit no right to his own heirs except in cases expressly represented by his descendants, who are total strangers to the
provided for in this Code. decedent, because the relationship established by adoption is
limited solely to the adopter and the adopted and does not extend
to the relatives of the adopting parents or of the adopted child, ARTICLE 918, NCC. Disinheritance without a specification of the
except only as expressly provided for by law. (Teotico v. Del Val) cause, or for a cause the truth of which, if contradicted, is not proved,
 However, if an illegitimate child predeceased the decedent, he or which is not one of those set forth in this Code, shall annul the
can be represented by his descendants, whether legitimate or institution of heirs insofar as it may prejudice the person disinherited;
illegitimate, both with respect to his legitime (in testamentary but the devises and legacies and other testamentary dispositions
succession) and his share as a legal heir (in intestate succession). shall be valid to such extent as will not impair the legitime.
 In intestate succession, if the decedent died without leaving
descendants, ascendants, illegitimate children, or a surviving (1) The disinheritance must be effected through a will;
spouse, the entire estate shall be inherited by the decedent’s (2) the legal cause thereof shall be specified in the will;
brothers and sisters or their children. (3) the cause must be one of those authorized by law;
o if one of the brothers or sisters of the decedent died (4) the truth of the cause must be proven, if contradicted;
ahead of him but such brother or sister left a child, said (5) the heir disinherited must be designated in such a manner that
nephew or niece shall inherit by right of representation. there can be no doubt as to his identity; and
o According to Article 975 CC, “when children of one or more (6) the disinheritance must be unconditional and total.
brothers or sisters of the deceased survive, they shall inherit
from the latter by representation, if they survive with their Otherwise, the disinheritance is invalid.
uncles or aunts."
o However, if only nephews and nieces survive, they shall (d) Effect of invalid disinheritance
inherit in their own right, in equal portions.  The effect of an ineffective/invalid disinheritance is the annulment
o If the one who predeceased the decedent is an ascendant, of the institution of heirs insofar as it may prejudice the legitime of
his death extinguishes his or her civil personality because the person disinherited, but the devises and legacies and other
there is no right of representation in the ascending line. (972) testamentary dispositions shall be valid to such extent as it will not
impair said legitime.
2. Valid Disinheritance  Hence, the legitime of the invalidly disinherited heir shall simply be
restored.
(a) Deprivation of legitime o If the testator did not dispose of the entire free portion, the part
ARTICLE 915, NCC. A compulsory heir may, in consequence of not disposed of shall be distributed by intestacy.
disinheritance, be deprived of his legitime, for causes expressly o As a consequence, the invalidly disinherited heir will likewise
stated by law. receive a share as a legal heir, in addition to his legitime,
 The testator cannot deprive his compulsory heirs of their legitime (e) Authorized causes for disinheritance:
(904[1]) except in consequence of a valid disinheritance. ARTICLE 919, NCC. The following shall be sufficient causes for the
 If the will provides only for valid disinheritance, in which case the disinheritance of children and descendants, legitimate as well as
estate shall be distributed by way of intestate succession, the illegitimate:
disinherited heir cannot likewise inherit as a legal heir, (1) When a child or descendant has been found guilty of an attempt
against the life of the testator, his or her spouse, descendants,
(b) Effect of disinheritance or ascendants;
(2) When a child or descendant has accused the testator of a
(1) If no representative crime for which the law prescribes imprisonment for six years
or more, if the accusation has been found groundless;
 If the compulsory heir has no representative (or descendant), he is (3) When a child or descendant has been convicted of adultery or
no longer counted as an heir. concubinage with the spouse of the testator;
 To illustrate: D, the decedent, had three children (A, B, and C) but (4) When a child or descendant by fraud, violence, intimidation,
A was validly disinherited and he does not have a descendant. The or undue influence causes the testator to make a will or to
legitime will only be divided between B and C. change one already made;
(5) A refusal without justifiable cause to support the parent or
(2) If representation takes place ascendant who disinherits such child or descendant;
(6) Maltreatment of the testator by word or deed, by the child or
 The law allows the children and descendants of the descendant;
disinherited heir to represent him with respect to his legitime. (7) When a child or descendant leads a dishonorable or
 The disinherited parent, however, is prohibited from having the disgraceful life;
usufruct or administration of the property which constitutes the (8) Conviction of a crime which carries with it the penalty of civil
legitime. interdiction.
 If the disinherited heir is a legitimate child of the decedent, the latter
may only be represented by his legitimate descendants but not by ARTICLE 920, NCC. The following shall be sufficient causes for the
his illegitimate descendants because of the barrier rule. disinheritance of parents or ascendants, whether legitimate or
 If the disinherited heir is an illegitimate child, the latter may be illegitimate:
represented by his legitimate and illegitimate descendants. If the (1) When the parents have abandoned their children or induced
disinherited heir is an adopted child, the latter’s descendants their daughters to live a corrupt or immoral life, or attempted
cannot represent him. against their virtue;
(2) When the parent or ascendant has been convicted of an attempt
(c) Requisites for valid disinheritance against the life of the testator, his or her spouse, descendants,
ARTICLE 916, NCC. Disinheritance can be effected only through a or ascendants;
will wherein the legal cause therefor shall be specified.
(3) When the parent or ascendant has accused the testator of a (b) when the spouse has given grounds for the loss of parental
crime for which the law prescribes imprisonment for six years or authority.
more, if the accusation has been found to be false;
(4) When the parent or ascendant has been convicted of adultery (f) Effect of subsequent reconciliation
or concubinage with the spouse of the testator;
(5) When the parent or ascendant by fraud, violence, intimidation, ARTICLE 922, NCC. A subsequent reconciliation between the
or undue influence causes the testator to make a will or to offender and the offended person deprives the latter of the right to
change one already made; disinherit, and renders ineffectual any disinheritance that may have
(6) The loss of parental authority for causes specified in this Code; been made.
(7) The refusal to support the children or descendants without
justifiable cause;  A subsequent reconciliation between the offender and the offended
(8) An attempt by one of the parents against the life of the other, person deprives the latter of the right to disinherit, and renders
unless there has been a reconciliation between them. ineffectual any disinheritance that may have been made.
 If disinheritance has already been made on any of the grounds
ARTICLE 921, NCC. The following shall be sufficient causes for which are also causes for unworthiness and there is subsequent
disinheriting a spouse: reconciliation, the disinheritance is already rendered ineffectual
(1) When the spouse has been convicted of an attempt against the and he can no longer be declared incapacitated.
life of the testator, his or her descendants, or ascendants;
(2) When the spouse has accused the testator of a crime for which 3. Capacity and Incapacity to Succeed
the law prescribes imprisonment of six years or more, and the
accusation has been found to be false; (a) Qualifications to succeed
(3) When the spouse by fraud, violence, intimidation, or undue ARTICLE 1030, NCC. Testamentary provisions in favor of the poor
influence cause the testator to make a will or to change one in general, without designation of particular persons or of any
already made; community, shall be deemed limited to the poor living in the domicile
(4) When the spouse has given cause for legal separation; of the testator at the time of his death, unless it should clearly appear
(5) When the spouse has given grounds for the loss of parental that his intention was otherwise.
authority;
(6) Unjustifiable refusal to support the children or the other spouse. The designation of the persons who are to be considered as poor and
the distribution of the property shall be made by the person appointed
(1) Causes common to all compulsory heirs: by the testator for the purpose; in default of such person, by the
(a) conviction by final judgment of an attempt against life of the executor, and should there be no executor, by the justice of the
testator, his or her spouse, descendant, or ascendant; peace, the mayor, and the municipal treasurer, who shall decide by
(b) accusing the testator of a crime for which the law prescribes a majority of votes all questions that may arise. In all these cases,
imprisonment for six years or more, if the accusation has been the approval of the Court of First Instance shall be necessary.
found groundless or false;
(c) when the heir causes the testator to make a will, or to change The preceding paragraph shall apply when the testator has disposed
one already made, by fraud, violence, intimidation, or undue of his property in favor of the poor of a definite locality.
influence;
(d) unjustifiable refusal to support the parent or ascendant who ARTICLE 1029, NCC. Should the testator dispose of the whole or
disinherits such child or descendant, for disinheritance of part of his property for prayers and pious works for the benefit of his
children and descendants; to support the children or soul, in general terms and without specifying its application, the
descendants, for disinheritance of parents or ascendants;496 executor, with the court’s approval shall deliver one-half thereof or its
and to support the children or the other spouse, for proceeds to the church or denomination to which the testator may
disinheritance of a spouse. belong, to be used for such prayers and pious works, and the other
(2) Other grounds to disinherit descendants half to the State, for the purposes mentioned in article 1013.
(a) when a child or descendant has been convicted of adultery or
concubinage with the spouse of the testator; ARTICLE 1024, NCC. Persons not incapacitated by law may
(b) maltreatment of the testator by word or deed, by the child or succeed by will or ab intestato.
descendant;
(c) when a child or descendant leads a dishonorable or The provisions relating to incapacity by will are equally applicable to
disgraceful life; and intestate succession.
(d) conviction of a crime which carries with it the penalty of civil
interdiction. ARTICLE 1025, NCC. In order to be capacitated to inherit, the heir,
(3) Other grounds to disinherit ascendants devisee or legatee must be living at the moment the succession
(a) when the parents have abandoned their children or induced opens, except in case of representation, when it is proper.
their daughters to live a corrupt or immoral life, or attempted
against their virtue; A child already conceived at the time of the death of the decedent is
(b) when the parent or ascendant has been convicted of adultery capable of succeeding provided it be born later under the conditions
or concubinage with the spouse of the testator; prescribed in article 41.
(c) the loss of parental authority for causes specified in the Family
Code; and (iv) an attempt by one of the parents against the
(1) Possession of juridical capacity, except:
life of the other, unless there has been a reconciliation
(a) a testamentary disposition by the testator of the whole or part
between them.
of his property for prayers and pious works for the benefit
(4) Other grounds to disinherit a spouse
of his soul, in general terms and without specifying its
(a) when the spouse has given cause for legal separation; and
application; and
(b) testamentary provisions made in favor of the poor in organization, or institution to which such priest or minister may
general, without designation of particular persons or belong;
community, are both valid. In the first exception, one-half (1/2) (3) A guardian with respect to testamentary dispositions given by a
of the property shall be delivered to the church or ward in his favor before the final accounts of the guardianship
denomination to which the testator may belong to be used for have been approved, even if the testator should die after the
such prayers and pious works, and the other half to the State, approval thereof; nevertheless, any provision made by the ward
for the benefit of public schools, and public charitable in favor of the guardian when the latter is his ascendant,
institutions and centers. In the second exception, the descendant, brother, sister, or spouse, shall be valid;
disposition shall be limited to the poor living in the domicile of (4) Any attesting witness to the execution of a will, the spouse,
the testator at the time of his death, unless it clearly appears parents, or children, or any one claiming under such witness,
that the intention was otherwise. spouse, parents, or children;
(2) Not specially disqualified by law. (5) Any physician, surgeon, nurse, health officer or druggist who
(3) The HDL must be living at the moment the succession opens. took care of the testator during his last illness;
However, a child already conceived at the time of the death of the (6) Individuals, associations and corporations not permitted by law
decedent is capable of succeeding, provided that it be born later to inherit.
under the conditions prescribed in Article 41 NCC.
ARTICLE 823, NCC. If a person attests the execution of a will, to
(b) Reckoning point in determining capacity whom or to whose spouse, or parent, or child, a devise or legacy is
ARTICLE 1034, NCC. In order to judge the capacity of the heir, given by such will, such devise or legacy shall, so far only as
devisee or legatee, his qualification at the time of the death of the concerns such person, or spouse, or parent, or child of such person,
decedent shall be the criterion. or any one claiming under such person or spouse, or parent, or child,
be void, unless there are three other competent witnesses to such
In cases falling under Nos. 2, 3, or 5 of article 1032, it shall be will. However, such person so attesting shall be admitted as a
necessary to wait until final judgment is rendered, and in the case witness as if such devise or legacy had not been made or given.
falling under No. 4, the expiration of the month allowed for the report.
ARTICLE 1032, NCC. The following are incapable of succeeding by
If the institution, devise or legacy should be conditional, the time of reason of unworthiness:
the compliance with the condition shall also be considered. (1) Parents who have abandoned their children or induced their
daughters to lead a corrupt or immoral life, or attempted against
 GR: In order to judge the capacity of the HDL, his qualification at their virtue;
the time of the death of the decedent shall be the criterion. (2) Any person who has been convicted of an attempt against the
 EXC: If the institution, devise, or legacy should be conditional and life of the testator, his or her spouse, descendants, or
the condition is suspensive, the capacity is to be determined not ascendants;
only at the time of the decedent’s death but also at the time of the (3) Any person who has accused the testator of a crime for which
fulfillment of the condition. the law prescribes imprisonment for six years or more, if the
o Hence, the death of the HDL before the happening of the accusation has been found groundless;
suspensive condition renders the testamentary disposition (4) Any heir of full age who, having knowledge of the violent death
inoperative and without effect; hence, such heir, devisee, or of the testator, should fail to report it to an officer of the law
legatee does not transmit anything to his own heirs, even if his within a month, unless the authorities have already taken action;
death occurs after that of the testator. this prohibition shall not apply to cases wherein, according to
law, there is no obligation to make an accusation;
(c) Persons specially disqualified to succeed (5) Any person convicted of adultery or concubinage with the
ARTICLE 739, NCC. The following donations shall be void: spouse of the testator;
(1) Those made between persons who were guilty of adultery or (6) Any person who by fraud, violence, intimidation, or undue
concubinage at the time of the donation; influence should cause the testator to make a will or to change
(2) Those made between persons found guilty of the same criminal one already made;
offense, in consideration thereof; (7) Any person who by the same means prevents another from
(3) Those made to a public officer or his wife, descendants and making a will, or from revoking one already made, or who
ascendants, by reason of his office. supplants, conceals, or alters the latter’s will;
(8) Any person who falsifies or forges a supposed will of the
In the case referred to in No. 1, the action for declaration of nullity decedent.
may be brought by the spouse of the donor or donee; and the guilt of
the donor and donee may be proved by preponderance of evidence (1) By reason of public policy (applicable only in testamentary
in the same action. succession):
(a) those made in favor of a person with whom the testator
ARTICLE 1028, NCC. The prohibitions mentioned in article 739, was guilty of adultery or concubinage at the time of the
concerning donations inter vivos shall apply to testamentary making of the will;
provisions. (b) those made in consideration of a crime of which both the
testator and the beneficiary have been found guilty; and
ARTICLE 1027, NCC. The following are incapable of succeeding: (c) those made in favor of a public officer or his spouse,
(1) The priest who heard the confession of the testator during his descendants and ascendants, by reason of his public office.
last illness, or the minister of the gospel who extended spiritual (2) By reason of possible undue influence (applicable only in
aid to him during the same period; testamentary succession):
(2) The relatives of such priest or minister of the gospel within the (a) the priest who heard the confession of the testator during his
fourth degree, the church, order, chapter, community, last illness, or the minister of the gospel who extended
spiritual aid to him during the same period;
(b) the relatives of such priest or minister of the gospel within the  If the unworthy heir is an adopted child, he may not be represented
fourth degree, and the church, order, chapter, community, by his descendants because the latter are not related to the
organization, or institution to which such priest or minister may decedent. If the right of representation cannot take place because
belong;”’ the unworthy heir has no descendant who can represent him, the
(c) a guardian with respect to testamentary dispositions given by share of the incapacitated heir shall go to his co-heir or coheirs by
a ward in his favor before the final accounts of the right of accretion, in case of intestate succession. (968)
guardianship have been approved, even if the testator should  In testamentary succession, however, the right of accretion cannot
die after the approval thereof;”" take place with respect to the legitime. Instead, the vacant part shall
(d) any attesting witness to the execution of a will, and the pass to the legal heirs of the testator following the rules of intestate
spouse, parents, or children, or any one claiming under such succession. In intestate succession, if the unworthy heir is a brother
witness, spouse, parents, or children, unless there are three or sister, he may be represented by his children if the latter concur
other competent witnesses to such will; and with their uncles and aunts. (Tolentino)
(e) any physician, surgeon, nurse, health officer, or druggist “who  However, if all the brothers or sisters of the decedent are
took care” of the testator during his last illness. incapacitated, the children of these brothers or sisters succeed by
(3) By reason of unworthiness (applicable to both testamentary their own right and not by the right of representation.
and intestate succession):
(a) parents who have abandoned their children or induced (e) Effect of pardon upon act of unworthiness
their daughters to lead a corrupt or immoral life, or ARTICLE 1033, NCC. The causes of unworthiness shall be without
attempted against their virtue; effect if the testator had knowledge thereof at the time he made the
(b) any person who has been convicted of an attempt against will, or if, having known of them subsequently, he should condone
the life of the testator, his or her spouse, descendants, or them in writing.
ascendants;
(c) any person who has accused the testator of a crime for  If the testator pardons the act of unworthiness, either expressly or
which the law prescribes imprisonment for six years or more, impliedly, the cause of unworthiness shall be without effect.
if the accusation has been found groundless;  There is express pardon when the decedent, having knowledge
(d) any heir of full age who, having knowledge of the violent of the cause, subsequently condones it in writing.
death of the testator, should fail to report it to an officer
 There is implied pardon when the testator, having knowledge of
of the law within a month, unless the authorities have already
the existence of a cause, institutes the offender as HDL.
taken action - this prohibition shall not apply to cases wherein,
according to law, there is no obligation to make an accusation;
(f) Prescriptive period of action to recover
(e) any person convicted of adultery or concubinage with the
ARTICLE 1040, NCC. The action for a declaration of incapacity and
spouse of the testator; and
for the recovery of the inheritance, devise or legacy shall be brought
(f) acts that will cause unworthiness in relation to the
within five years from the time the disqualified person took
testator’s will, as follows:
possession thereof. It may be brought by any one who may have an
(i) causing the testator to make a will or to change an
interest in the succession.
existing will,
(ii) preventing the decedent from making a will or from
 The action for a declaration of incapacity and for the recovery of
revoking his will;
the inheritance, devise, or legacy shall be brought within 5 years
(iii) supplanting, concealing, or altering the testator’s will; or
from the time the disqualified person took possession thereof.
falsifying or
 The action may be brought by anyone who may have an interest in
(iv) forging a supposed will of the decedent.
the succession.
(d) Effects of incapacity or unworthiness
4. Acceptance and Repudiation of Inheritance
(1) If the incapacity is by reason of any of the causes enumerated in
Articles 1027 and 1028, only the shares given to voluntary heirs,
(a) Requisites of effective acceptance or repudiation
devisees, and legatees are affected, but not the legitime.
ARTICLE 1035, NCC. If the person excluded from the inheritance by
reason of incapacity should be a child or descendant of the decedent
 Thus, if the incapacitated person is both a compulsory heir and a
and should have children or descendants, the latter shall acquire his
voluntary HDL at the same time, only his share as a voluntary
right to the legitime.
HDL is rendered vacant and there is no right of representation
(with respect to the disposable free portion).
The person so excluded shall not enjoy the usufruct and
 What may apply to the disposable free portion in the order of
administration of the property thus inherited by his children.
applicability are the following:
o (i) substitution;
(1) the person accepting or repudiating the inheritance must be certain
o (ii) accretion; or
of the death of the person from whom he is to inherit; and
o (iii) intestate succession.
(2) he must likewise be certain of his right to the inheritance.
(2) If the incapacity is by reason of unworthiness in Article 1032, the
(b) Who may effect acceptance or repudiation:
effect thereof is exclusion from the entire inheritance.
ARTICLE 1044, NCC. Any person having the free disposal of his
 In intestate succession and testamentary succession (but with
property may accept or repudiate an inheritance.
respect to the legitime only), representation may take place if the
unworthy heir is a legitimate child or an illegitimate child and the
Any inheritance left to minors or incapacitated persons may be
former has a legitimate descendant (because the unworthy heir
accepted by their parents or guardians. Parents or guardians may
may not be represented by his illegitimate child pursuant to the
repudiate the inheritance left to their wards only by judicial
barrier rule) and the latter has a descendant, whether legitimate or
authorization.
illegitimate.
 A tacit acceptance is one resulting from acts by which the

The right to accept an inheritance left to the poor shall belong to the intention to accept is necessarily implied, or which one would
persons designated by the testator to determine the beneficiaries and have no right to do except in the capacity of an heir, such as
distribute the property, or in their default, to those mentioned in article o when the heir sells, donates, or assigns his right to a
1030. stranger, or to his co-heirs, or to any of them; or
o if he renounces the same, even though gratuitously, for the
ARTICLE 1047, NCC. A married woman of age may repudiate an benefit of one or more of his co-heirs; or
inheritance without the consent of her husband. o he renounces it for a price in favor of all his coheirs
indiscriminately (this is no renunciation at all); or
ARTICLE 1048, NCC. Deaf-mutes who can read and write may o if within 30 days after the court has issued an order for
accept or repudiate the inheritance personally or through an agent. the distribution of the estate in accordance with the ROC,
Should they not be able to read and write, the inheritance shall be the HDLs failed to signify to the court having jurisdiction
accepted by their guardians. These guardians may repudiate the whether they accept or repudiate the inheritance, in which
same with judicial approval. case, they are deemed to have accepted the inheritance.
Rule: As to repudiation
 If the HDL is capacitated to act and has the free disposal of his ARTICLE 1051, NCC. The repudiation of an inheritance shall be
property, he may personally accept or repudiate the inheritance. made in a public or authentic instrument, or by petition presented to
 Deaf-mutes who can read and write may accept or repudiate the the court having jurisdiction over the testamentary or intestate
inheritance personally or through an agent. proceedings.
 A married woman of age may repudiate an inheritance without
the consent of her husband. To be effective, the renunciation of an inheritance must either be:
(1) by way of a notarial document (public document);
As to minors and incapacitated persons (2) by way of an authentic document (or one whose genuineness is
(1) as to acceptance, it can be made by their parents or guardians; and admitted or clearly proved); or
(2) as to repudiation, parents or guardians may repudiate the (3) by way of a petition presented to the court having jurisdiction over
inheritance left to their wards only by judicial authorization. the testamentary proceedings
(c) Manner and formalities: (d) Effect of death

As to acceptance ARTICLE 1053, NCC. If the heir should die without having accepted
ARTICLE 1049, NCC. Acceptance may be express or tacit. or repudiated the inheritance his right shall be transmitted to his heirs.
An express acceptance must be made in a public or private If the heir should die without having accepted or repudiated the
document. inheritance his right shall be transmitted to his heirs.
A tacit acceptance is one resulting from acts by which the intention (e) Effect of repudiation if heir is both testamentary and intestate
to accept is necessarily implied, or which one would have no right to heir
do except in the capacity of an heir. ARTICLE 1055, NCC. If a person, who is called to the same
inheritance as an heir by will and ab intestato, repudiates the
Acts of mere preservation or provisional administration do not imply inheritance in his capacity as a testamentary heir, he is understood
an acceptance of the inheritance if, through such acts, the title or to have repudiated it in both capacities.
capacity of an heir has not been assumed.
Should he repudiate it as an intestate heir, without knowledge of his
ARTICLE 1050, NCC. An inheritance is deemed accepted: being a testamentary heir, he may still accept it in the latter capacity.
(1) If the heirs sells, donates, or assigns his right to a stranger, or
to his co-heirs, or to any of them; (1) if he repudiates the inheritance in his capacity as a
(2) If the heir renounces the same, even though gratuitously, for the testamentary heir, he is deemed to have repudiated the
benefit of one or more of his co-heirs; inheritance also as an intestate heir; and
(3) If he renounces it for a price in favor of all his co-heirs (2) if he repudiates the inheritance as an intestate heir, without the
indiscriminately; but if this renunciation should be gratuitous, knowledge of his being a testamentary heir, he is not deemed to
and the co-heirs in whose favor it is made are those upon whom have renounced as testamentary heir and may therefore accept it
the portion renounced should devolve by virtue of accretion, the in the latter capacity.
inheritance shall not be deemed as accepted.
(f) Effects of acceptance or repudiation:
ARTICLE 1057, NCC. Within thirty days after the court has issued [1] Retroactive
an order for the distribution of the estate in accordance with the Rules ARTICLE 1042, NCC. The effects of the acceptance or repudiation
of Court, the heirs, devisees and legatees shall signify to the court shall always retroact to the moment of the death of the decedent.
having jurisdiction whether they accept or repudiate the inheritance.
 The effects of the acceptance or repudiation shall always retroact
If they do not do so within that time, they are deemed to have to the moment of the death of the decedent even if the institution
accepted the inheritance. of the heir is subject to a suspensive condition.
 Successional rights in institutions with a suspensive condition are
It may be express or implied (tacit). transmitted only upon the happening of the condition, although the
 An express acceptance must be made in a public or private effects retroact to the moment of the testator’s death. (Tolentino)
document.
[2] Irrevocability
ARTICLE 1056, NCC. The acceptance or repudiation of an  If the inheritance should be repudiated by all the nearest relatives
inheritance, once made, is irrevocable, and cannot be impugned, called by law to succeed, those of the following degree shall inherit
except when it was made through any of the causes that vitiate in their own right.
consent, or when an unknown will appears.
L. Modes of Filling Up Vacancies
The acceptance or repudiation of an inheritance, once made, is
irrevocable and cannot be impugned except: 1. Modes of Filling Up Vacancies
(1) when the acceptance or repudiation was made through any of the
causes which vitiate consent (fraud, undue influence, violence, (1) Substitution;
intimidation, or mistake); and (2) Accretion;
(2) when an unknown will appears. (3) Right of representation; and
(4) Intestate succession.
[3] In testamentary succession with respect to disposable free
portion 2. Substitution
If a voluntary HDL repudiates his share, what may apply to the
disposable free portion in the order of applicability are the following: ARTICLE 904, para. 2, NCC. The testator cannot deprive his
(1) substitution; compulsory heirs of their legitime, except in cases expressly
(2) accretion; or specified by law.
(3) intestate succession.
[4] In testamentary succession with respect to legitime condition, or substitution of any kind whatsoever.
ARTICLE 977, NCC. Heirs who repudiate their share may not be
represented. ARTICLE 872, NCC. The testator cannot impose any charge,
ARTICLE 1021, NCC. Among the compulsory heirs the right of in this Code. Should he do so, the same shall be considered as not
accretion shall take place only when the free portion is left to two or imposed.
more of them, or to any one of them and to a stranger.
 It is a mode of filling up vacancies in succession that is applicable
Should the part repudiated be the legitime, the other co-heirs shall only to the disposable free portion.
succeed to it in their own right, and not by the right of accretion.  It cannot be imposed upon the legitime.
 Since substitution is pursuant to the express will of the testator, it
ARTICLE 969, NCC. If the inheritance should be repudiated by the does not find application in intestate succession.
nearest relative, should there be one only, or by all the nearest  The concept is already discussed in Section 10.3 of this Book.
relatives called by law to succeed, should there be several, those of
the following degree shall inherit in their own right and cannot 3. Accretion
represent the person or persons repudiating the inheritance.
Accretion, as a mode of filling up vacancies in succession, is applicable
 Representation cannot take place because “heirs who repudiate to both testamentary and intestate succession.
their share may not be represented.
 The vacant part cannot likewise go to the other compulsory (a) Testamentary succession
heirs by right of accretion because no accretion is allowed with ARTICLE 1021, NCC. Among the compulsory heirs the right of
respect to the legitime. accretion shall take place only when the free portion is left to two or
o Instead, the vacant part shall pass to the legal heirs of the more of them, or to any one of them and to a stranger.
testator, who shall inherit the same in their own right as legal
heirs. Should the part repudiated be the legitime, the other co-heirs shall
o However, if all the compulsory heirs in the first degree (the succeed to it in their own right, and not by the right of accretion.
children) repudiated their inheritance, their respective
children (the grandchildren) will become compulsory  As already discussed in Section 10.4, in testamentary succession,
heirs, not by right of representation, but by their own right. accretion applies only to the disposable free portion. It cannot
take place with respect to the legitime.
[5] In intestate succession  As a consequence, if the part repudiated by a compulsory heir
ARTICLE 1018, NCC. In legal succession the share of the person be the legitime, or if a compulsory heir is incapacitated and he
who repudiates the inheritance shall always accrue to his co-heirs. does not have a descendant to represent him, the vacant part
shall pass to the legal heirs of the testator and they shall inherit
ARTICLE 968, NCC. If there are several relatives of the same in their own right.
degree, and one or some of them are unwilling or incapacitated to
succeed, his portion shall accrue to the others of the same degree, (b) Intestate succession
save the right of representation when it should take place. ARTICLE 1018, NCC. In legal succession the share of the person
who repudiates the inheritance shall always accrue to his co-heirs.
ARTICLE 969, NCC. X
ARTICLE 977, NCC. X
 The share of the person who repudiates the inheritance shall
always accrue to his co-heirs. ARTICLE 968, NCC. X
 However, the accretion shall be in favor of co-heirs “of the same
degree. ARTICLE 969, NCC. X
(1) If vacancy is by reason of repudiation ARTICLE 923, NCC. The children and descendants of the person
(a) the share of the person who repudiates the inheritance shall disinherited shall take his or her place and shall preserve the rights
always accrue to his co-heirs, because there is no of compulsory heirs with respect to the legitime; but the disinherited
representation in case of repudiation. parent shall not have the usufruct or administration of the property
(b) However, if all heirs of the same degree repudiate the which constitutes the legitime.
inheritance, in which case the right of accretion cannot take
place, the relatives in the next degree shall inherit in their (4) If the vacancy is by reason disinheritance because the testator
own right and cannot represent the person or persons only provides for disinheritance in his will but did not make an
repudiating the inheritance. affirmative disposition of the estate,
(a) in which case, the entire estate will have to be distributed
ARTICLE 1035, NCC. If the person excluded from the inheritance by following the rules of intestate succession minus the
reason of incapacity should be a child or descendant of the decedent disinherited heir, but the latter may be represented by his
and should have children or descendants, the latter shall acquire his children or descendants.
right to the legitime. (b) BUT if the disinherited heir has no children or descendants
who may represent him, the other heirs shall inherit in their
The person so excluded shall not enjoy the usufruct and own right and not by accretion.
administration of the property thus inherited by his children. (i) Here, there is no vacancy because the disinherited heir
is no longer counted as one of the legal heirs.
ARTICLE 992, NCC. An illegitimate child has no right to inherit ab
intestato from the legitimate children and relatives of his father or 4. Right of Representation
mother; nor shall such children or relatives inherit in the same
manner from the illegitimate child. (a) Concept
ARTICLE 970, NCC. Representation is a right created by fiction of
ARTICLE 975, NCC. When children of one or more brothers or law, by virtue of which the representative is raised to the place and
sisters of the deceased survive, they shall inherit from the latter by the degree of the person represented, and acquires the rights which
representation, if they survive with their uncles or aunts. But if they the latter would have if he were living or if he could have inherited.
alone survive, they shall inherit in equal portions.
 Representation is the right created by fiction of law, by virtue of
ARTICLE 1005, NCC. Should brothers and sisters survive together which the representative is raised to the place and degree of the
with nephews and nieces, who are the children of the descendant’s person represented, and acquires the rights which the latter would
brothers and sisters of the full blood, the former shall inherit per have if he were living or if he could have inherited.
capita, and the latter per stirpes.  By right of representation, a more distant blood relative of a
decedent is, by operation of law, "raised to the same place and
ARTICLE 968, NCC. X degree " of relationship as that of a closer blood relative of the same
decedent.
(2) If vacancy is by reason of incapacity. o The representative thereby steps into the shoes of the person
(a) Article 968 provides that the vacant part shall accrue to the he represents and succeeds, not from the latter, but from the
other relatives of the same degree (accretion), unless the right person to whose estate the person represented would have
of representation can take place. Hence, in case of incapacity succeeded. (Bagunu v. Piedad)
in intestate succession, the rule is right of representation
first before accretion. (b) Applicable only in succession by operation of law
(b) In the following situations in intestate succession, the law Representation takes place only with respect to inheritance conferred by
allows representation: law. (Tolentino) Thus, representation takes place only in the
(i) if the incapacitated heir is a child or descendant of the following kinds of succession:
decedent, he can be represented by his children or (1) in legal or intestate succession; or
descendants, subject to the application of the barrier (2) in testamentary succession, only with respect to the legitime.
rule; and
(ii) if the legal heirs of the decedent are his brothers and  Only legal and compulsory heirs may be represented.
sisters and one or some of them are incapacitated to  There is no right of representation with respect to a voluntary
inherit, the incapacitated brother or sister can be HDL who succeeds only by virtue of the will,
represented by his children but only when the latter
concur with their uncles and aunts. (c) Who may be represented
1) If the right of representation cannot take place
because the incapacitated heir has no children or (1) As to legitime in testamentary succession
descendants who may represent him, his share
shall accrue to the other co-heirs of the same ARTICLE 972, NCC. The right of representation takes place in the
degree. direct descending line, but never in the ascending.
2) In this situation, there is a real vacancy.
(3) If the vacancy is by reason of predecease and the right of In the collateral line, it takes place only in favor of the children of
representation cannot take place because the heir who died ahead brothers or sisters, whether they be of the full or half blood.
of the decedent has no child or descendant,
(a) the other heirs inherit in their own right and not by ARTICLE 902, NCC. The rights of illegitimate children set forth in the
accretion. In intestate succession, accretion cannot take place preceding articles are transmitted upon their death to their
by reason of predecease. descendants, whether legitimate or illegitimate.
(b) Here, there is no vacancy.
 Among the compulsory heirs, only the children or descendants of

the testator may be represented by his children or descendants. (e) Other principles governing representation
 The ascendants and the surviving spouse may not be represented. (1) The representative is raised to the place and the degree of the
There is no right of representation in the ascending line. person represented and he acquires the rights which the latter
would have if he were living or if he could have inherited. (970)
 As to the legitimate children or descendants, they may only be (a) As a consequence, whenever there is succession by
represented by their legitimate descendants but not by their representation, the division of the estate shall be per stirpes,
illegitimate descendants. Under the barrier rule, an illegitimate in such manner that the representative or representatives
child is prohibited to inherit from the legitimate relatives of his shall not inherit more than what the person they represent
parents. (992) would inherit, if he were living or could inherit. (974)
 As to the illegitimate children, they can be represented by their (2) The representative does not succeed the person represented but
descendants, whether they are legitimate or illegitimate. (902) the one whom the person represented would have succeeded.
 An adopted child may not be represented because the children or (972)
descendants of the adopted are not related to the adopter. (a) As consequences:
o In adoption, the children of the adopted are total strangers to (i) in order that representation may take place, it is
the adopter because the relationship established by adoption necessary that the representative himself be capable of
is limited solely to the adopter and the adopted and does not succeeding the decedent; (973) and
extend to the relatives of the adopting parents or of the (ii) the representative may represent a person whose
adopted child. inheritance he has renounced. (976)
1) Following this rule, if the person to be represented
(2) In intestate succession is a legitimate child, his illegitimate child cannot
represent him in the succession to the estate of the
 The children or descendants of the decedent may also be grandfather because of the barrier rule. (Lorenzo v.
represented. (978, 990) CA; Diaz v. CA)
o The ascendants and the surviving spouse may not be
represented. The same rules earlier discussed are also  On the other hand, if the person represented is himself illegitimate,
applicable. he may be represented by his descendants, whether they are
o In the collateral line, a brother or sister may be represented legitimate or illegitimate. (902, 989, 990)
by his children when the latter survive with uncles and aunts o In other words, an illegitimate grandchild can represent in the
with whom they concur in the succession. (975, 1005) succession to the estate of an illegitimate grandparent.
 However, if only nephews and nieces survive, they shall inherit o However, an adopted child cannot represent the adopter with
in their own right and not by representation. (975) respect to the estate of the parents of the adopter because
o The right of representation does not apply, however, to “other the relationship created by the adoption is between only the
collateral relatives within the fifth civil degree,” who are sixth adopting parents and the adopted child and does not extend
in the order of preference in intestate succession.” (Bagunu) to the blood relatives of either party. (Sayson v. CA)
o Among collateral relatives, except only in the case of nephews o In addition, since the capacity and right to succeed of the
and nieces of the decedent concurring with their uncles or representative must be determined in relation to the decedent
aunts, the rule of proximity is an absolute rule. and not the person represented, a son who cannot inherit from
his father on the ground of unworthiness can still inherit from
(d) Causes for representation his grandfather by representing his father, provided he himself
Representation is proper when the cause of the vacancy in succession is not unworthy with regard to the said grandfather. (Tolentino)
are the following:
(1) predecease; (902, 981, 982, 990, 1003) M. Intestate or Legal Succession
(2) incapacity; and (968, 975, 1005, 1035)
(3) disinheritance. (923, 970) 1. When Intestate Succession Takes Place
 However, the law does not allow representation in case of
repudiation. The law provides that “heirs who repudiate their share (a) With respect to the entire estate
may not be represented. (977) ARTICLE 960. Legal or intestate succession takes place:
 Should the part repudiated be the legitime, the other co-heirs (1) If a person dies without a will, or with a void will, or one which
shall succeed to it in their own right, and not by right of has subsequently lost its validity;
accretion (1021), meaning, the vacant part shall be inherited by (2) When the will does not institute an heir to, or dispose of all
the legal heirs of the testator following the rules of intestate the property belonging to the testator. In such case, legal
succession. succession shall take place only with respect to the property of
which the testator has not disposed;
 In intestate succession, the share of the person who repudiates
(3) If the suspensive condition attached to the institution of
the inheritance shall always accrue to his co-heirs (1018) and
heir does not happen or is not fulfilled, or if the heir dies
the heirs to whom the portion goes by the right of accretion take it
before the testator, or repudiates the inheritance, there being
in the same proportion that they inherit. (1019)
no substitution, and no right of accretion takes place;
o If there are several relatives of the same degree, and one or
(4) When the heir instituted is incapable of succeeding, except in
some of them are unwilling to succeed, his portion shall
cases provided in this Code.
accrue to the others of the same degree. (968)
o However, if the inheritance should be repudiated by the
nearest relative, should there be one only, or by all the nearest (1) when a person dies without a will; or when the will is void; or
relatives called by law to succeed, should there be several, when the will has subsequently lost its “efficacy; (960) and
those of the following degree shall inherit in their own right and (2) when the institution of heirs is annulled because of preterition
cannot represent the person or persons repudiating the and there are no devises and legacies. (854; Morales v.
inheritance. (969) Olondriz)
(b) Partial intestacy: grandparents are within the direct line. The direct line is either
(1) when the institution of heirs is annulled because of preterition descending or ascending. The descending direct line unites the
but there are devises and legacies; head of the family with those who descend from him.
(2) when the will does not dispose of all the property belonging to (2) The ascending direct line binds a person with those from whom he
the testator; descends.
(3) when a (voluntary) heir repudiates the inheritance, there being
no substitution and no right of accretion takes place; Collateral line
(4) when a (voluntary) heir dies before the testator or when he is  A collateral line is that constituted by the series of degrees among
incapable of succeeding, there being no substitution and no persons who are not ascendants and descendants, but who come
right of accretion or representation takes place; from a common ancestor. (964)
(5) with respect to the legitime, when a compulsory heir  For example, brothers and sisters are collateral relatives and their
repudiates the inheritance because representation may common ancestors are their parents,
not take place;
(6) with respect to the legitime, when a compulsory heir is How to count decrees
incapacitated to inherit and he cannot be represented ARTICLE 966, NCC. In the line, as many degrees are counted as
because he has no descendants; (977, 1021) there are generations or persons, excluding the progenitor.
(7) with respect to the vacant part only, when the suspensive
condition attached to the institution of heir does not happen or In the direct line, ascent is made to the common ancestor. Thus, the
is not fulfilled; child is one degree removed from the parent, two from the
(8) with respect to the vacant part only, when the resolutory grandfather, and three from the great-grandparent.
condition attached to the institution of heir happens, there
being no substitution and no right of accretion takes place; In the collateral line, ascent is made to the common ancestor and
and then descent is made to the person with whom the computation is to
(9) with respect to the vacant part, when the resolutory term be made. Thus, a person is two degrees removed from his brother,
attached to the institution of heir arrives, there being no three from his uncle, who is the brother of his father, four from his
substitution and no right of accretion takes place. first cousin, and so forth.
2. Basic Rules of Intestate Succession  In the direct line

o ascent is made to the common ancestor.
(1) Order of succession; o Thus, the child is one degree removed from the parent, two
(2) Rule of preference of lines, concurrence, and exclusion; from the grandfather, and three from the great-grandparent.
(3) Rule of proximity, but subject to the right of representation;  In the collateral line
(4) Rule of equal division, subject to the rule that relatives of the full o ascent is made the common ancestor and then descent is
blood shall inherit double than that of the half blood; and made to the person with whom the computation is to be made.
(5) the Barrier rule. o Thus, a person is two degrees removed from his brother, three
from his uncle, four from his cousin, and so forth.
3. Relationship
Full and half-blood
Determination of proximity ARTICLE 967, NCC. Full blood relationship is that existing between
ARTICLE 964, NCC. A series of degrees forms a line, which may be persons who have the same father and the same mother.
either direct or collateral.
Half blood relationship is that existing between persons who have the
A direct line is that constituted by the series of degrees among same father, but not the same mother, or the same mother, but not
ascendants and descendants. the same father.
A collateral line is that constituted by the series of degrees among

 Full blood relationship is that existing between persons who have
persons who are not ascendants and descendants, but who come
the same father and the same mother.
from a common ancestor.
 Half-blood relationship is that existing between persons who have
the same father, but not the same mother, or the same mother, but
not the same father.
(1) Proximity of relationship is determined by the number of
generations. Each generation forms a degree.
N. Simplified Rules of Intestate Succession: Estate of Legitimate
(2) A series of degrees forms a line, which may be either direct or
Decedent
collateral.
1. Order of Succession
Direct line
ARTICLE 965, NCC. The direct line is either descending or 1st: legitimate children and descendants;
ascending. 2nd: legitimate parents and ascendants;
3rd: illegitimate children and descendants;
The former unites the head of the family with those who descend from 4th: surviving spouse;
him. 5th: brothers and sisters and/or nephews and nieces;
6th: other collateral relatives within the fifth civil degree; (Bagunu)
The latter binds a person with those from whom he descends. 7th: the State.
(1) A direct line is that constituted by the series of degrees among  Under the FC, family relations, which is the primary basis for
ascendants and descendants. For example, parents, children, and succession, exclude relations by affinity. (Ining v. Vega)
 One who is merely related by affinity to the decedent does not The surviving spouse and illegitimate children shall inherit with the
inherit from the latter and cannot become a co-owner of the legitimate descendants. (983, amended by 176 FC, 996, 999)
decedent’s property.
o Thus, a surviving spouse is not an intestate heir of his or her (a) If concurring with surviving spouse
parent-in-law. (Rosales v. Rosales) Should the spouse of the decedent survive with legitimate children or
descendants, the share of the surviving spouse shall be the same as the
2. Rule No. 1 share of each of the children, (996) regardless of the number of the
children. (Santillon v. Miranda)
illegitimate children, or a surviving spouse, the collateral relatives (b) If concurring with illegitimate children
shall succeed to the entire estate of the deceased in accordance with The share of each legitimate child is double than the share of an
the following articles. illegitimate child. (983)
 Ex. There are 2 legitimate and 2 illegitimate children and the estate
The direct line excludes the collateral line, but the surviving spouse and is P1.2M. The formula shall be [2x + 2x +x +x = P1.2M].
the illegitimate children concur with the direct line, o Hence, the share of each illegitimate child is P200.000;
(a) Effect of existence of direct line: The collateral blood relatives o while the share of each legitimate child is P400.000.
(starting from the brothers and sisters) do not inherit in intestate o Here, there is no impairment of the legitime of the legitimate
succession if the decedent is survived by either legitimate children.
descendants or ascendants.  If there is impairment of the legitime of the legitimate children,
(b) Rule of concurrence: However, the surviving spouse and the the formula cannot apply.
illegitimate children shall always inherit together with either the o Instead, their respective legitimes shall also be their
legitimate descendants or legitimate ascendants of the decedent. shares in intestate succession.
(983, 991, 996, 997, 999, 1000) o Ex. If the estate is P9 million and the decedent was survived
(1) They are not excluded by the direct line. by 1 legitimate child and 3 illegitimate children. Following the
formula above, their shares would be [2x + x + x + x = P9
3. Rule No. 2 million.]
o This formula, however, will impair the legitime of the legitimate
ARTICLE 985, NCC. In default of legitimate children and child. Hence, their legitimes shall also be their shares in
descendants of the deceased, his parents and ascendants shall intestate succession.
inherit from him, to the exclusion of collateral relatives. o The legitimate child gets P4.5M as his share, while each of
the illegitimate children shall receive P1.5 M.
The direct descending line excludes the direct ascending line. The
ascendants will only inherit in the absence of descendants. (c) If concurring with surviving spouse and illegitimate children
Same rules as above.
Effect of existence of legitimate descendants Ex. If the estate is P8M and the decedent was survived by his widow, 2
ARTICLE 985, NCC. X legitimate children and 2 illegitimate children
 the formula shall be [2x + 2x (shares of the 2 legitimate children) +
ARTICLE 1003, NCC. X 2x (share of the widow) + x + x (shares of the two illegitimate
children) = P8 million].
ARTICLE 983, NCC. If illegitimate children survive with legitimate  The share of each illegitimate child shall be P1M; while the share
children, the shares of the former shall be in the proportions of each legitimate child and the surviving spouse shall be P2M.
prescribed by article 895.
Rule of proximity
ARTICLE 176, FC. X ARTICLE 962, NCC. In every inheritance, the relative nearest in
degree excludes the more distant ones, saving the right of
representation when it properly takes place.
ARTICLE 996, NCC. If a widow or widower and legitimate children
or descendants are left, the surviving spouse has in the succession
Relatives in the same degree shall inherit in equal shares, subject to
the same share as that of each of the children.
the provisions of article 1006 with respect to relatives of the full and
half blood, and of article 987, paragraph 2, concerning division
ARTICLE 999, NCC. When the widow or widower survives with
between the paternal and maternal lines.
legitimate children or their descendants and illegitimate children or
their descendants, whether legitimate or illegitimate, such widow or
 Among the descendants, the relative nearest in degree excludes
widower shall be entitled to the same share as that of a legitimate
the more distant ones EXC when the right of representation
child.
properly takes place. (962[1])
 If all the children of the decedent survive, have the capacity to
 The legitimate parents and other ascendants and all collateral
inherit, no one is validly disinherited, and all are willing to accept
blood relatives do not inherit (985 and 1003)
their shares in the inheritance, the grandchildren and other
 the surviving spouse and illegitimate children shall inherit with
descendants cannot inherit in any capacity.
the legitimate descendants. (983, as amended by 176 FC, 996,
999)
(1) Rule of equal division
 In the absence of a surviving spouse and illegitimate children, the
 The children of the deceased shall always inherit from him in
entire estate shall be inherited by the legitimate descendants.
their own right, dividing the inheritance in equal shares, even if
they should come from different marriages. (980, 979[1])
Rule of concurrence
 An adopted child is counted as one of the legitimate children and  An heir who repudiates his share may not be represented. (977)
he inherits in the same manner as them. (979[2], Sec. 17 and 18  In intestate succession, in case of repudiation by one or some, but
Domestic Adoption Act) not all, of the children, the vacant share or shares shall always
accrue to the co-heirs. (1018, 968)
(2) Subject to right of representation
The rule of proximity in the direct descending line is subject to the right (iv) When grandchildren inherit in their own right:
of representation, (972[1]) in case of predecease, incapacity, or  If all the children survive the decedent, all are capacitated to
disinheritance of one, some, or all of the children. inherit and no one is validly disinherited, but all of them repudiate
 Since the person to be represented is a legitimate child, only the their shares in the inheritance, the grandchildren shall inherit in
legitimate natural descendants may represent. their own right, (969) because accretion and representation cannot
 The illegitimate and adopted children of the person represented take place. (968, 977)
cannot represent because they are not capable of succeeding the  This is the only situation where the grandchildren will inherit
decedent. (973) in their own right. Since they will be inheriting in their own right,
o IC: they are prohibited under the barrier rule to inherit from the estate will be divided equally among the grandchildren (per
the legitimate relatives of the parents. (992) capita).
o Adopted children: they are not related to the decedent
because the relationship created by the adoption is between 4. Rule No. 3 – Barrier or Iron Curtain Rule
only the adopting parents and the adopted child and does not
extend to the blood relatives of either party. (Sayson v. CA) (a) Prohibition under barrier rule
 An illegitimate child is prohibited to inherit ab intestato from the
(i) Grandchildren inherit by representation: estate of the legitimate children and relatives of his father or
 GR: grandchildren inherit by right of representation. (981, 982) mother; nor shall children or relatives inherit in the same manner
 In case of predecease, incapacity, or disinheritance of one or from the illegitimate child. (992)
some of the children, but not all, and those who predeceased, were  The prohibition is reciprocal.
incapacitated or disinherited have children or descendants, the o The persons whom the IC cannot succeed are also
children of the deceased shall inherit in their own right, and disqualified to succeed him.
the grandchildren by right of representation. (981) o Hence, relatives on the legitimate line have no right to inherit
 In case all the children died ahead of the decedent, or were ab intestato from an illegitimate relative.
incapacitated or disinherited, and all have their own children or  Following this rule, the legitimate collateral relatives of the mother
descendants, the grandchildren and other descendants shall cannot succeed from her illegitimate child (Cache v. Udan)
inherit by right of representation (and not by their own right), and  the illegitimate daughter cannot succeed to the estate of her
if any one of them should have died, leaving several heirs, the deceased uncle, who is a legitimate brother of her natural mother;
portion pertaining to him shall be divided among the latter in equal (Anuran v. Aquino and Ortiz) and
portions. (982) The division of the estate shall be per stirpes.  illegitimate children of an uncle, who is a brother of the decedent’s
father, cannot inherit from the decedent ab intestato because the
(ii) In case there is no representative latter is a legitimate child. (Grey v. Fabie)
In case of predecease or disinheritance of one of the children and the (b) Consequence of barrier rule in right of representation
right of representation cannot take place because the latter does not  An illegitimate child has no right to succeed ab intestato from the
have children or descendants, the other children shall inherit in their legitimate father or mother of his natural parent.
own right and not by right of accretion. o Hence, an IC has no right to represent his natural parent, if
 In other words, the one who died ahead (predeceased) or was the latter is a legitimate child.
disinherited is no longer counted as an heir. o The determining factor is the legitimacy or illegitimacy of
 To illustrate: The decedent had three children (A, B, and C) but A the person to be represented. (Diaz v. IAC)
either died ahead of the decedent or was validly disinherited (and  If the person to be represented is an illegitimate child, then his
that is the only provision in the will). B predeceased the decedent, descendants, whether legitimate or illegitimate, may represent him;
but he left a child, X. Here, A is no longer counted as an heir and however, if the person to be represented is legitimate, his
the estate is divided equally between C, who inherits in his own illegitimate descendants cannot represent him because the law
right, and X, who shall inherit by representing B. provides that only his legitimate descendants may exercise the
right of representation by reason of the barrier imposed under 992.
On the other hand, in case of incapacity of one of the children and the
right of representation cannot take place because the latter does not (c) No barrier rule in succession by will
have children or descendants, the vacant portion shall go to the other The prohibition under the barrier rule is applicable only in succession
children by right of accretion. (968) by operation of law. It does not apply to succession by will.
 In accretion, the vacant share shall go to the coheir of the same
degree. (d) Application of barrier rule between brothers and sisters
 To illustrate: The decedent had three children, A, B, and C. A is  The law prohibits reciprocal succession between illegitimate
incapacitated to inherit and he has no children or descendants; children and legitimate children of the same parent, even though
while B predeceased the decedent, but he left a child, X. Here, the there is unquestionably a tie of blood between them. (992)
estate of the decedent will still be divided into three parts. C will get  THUS, the illegitimate children of a legitimate child cannot inherit
1/3 by his own right. The share of B will go to X, by right of from the latter’s legitimate brother. (Pascual v. Pascual-Bautista)
representation. As to the share of A, the same shall accrue in favor  In the same way, where the illegitimate child had half-brothers who
of his co-heir in the same degree, that is, C. X is not entitled to were legitimate, the latter had no right to succeed to the former’s
accretion because he is not of the same degree as C. estate under the rules of intestacy. (Corpuz v. Corpuz)
(iii) In case of repudiation:

 On the other hand, if both are illegitimate children, they can inherit
ab intestato from each other. (Delgado Vda de Dela Rosa v. Heirs ARTICLE 1018, NCC. In legal succession the share of the person
of Marciana Rustia vda. De Damian) who repudiates the inheritance shall always accrue to his co-heirs.
o They all stand on the same footing before the law, just like
legitimate children of half-blood relation. ARTICLE 1019, NCC. The heirs to whom the portion goes by the
o The rules regarding succession of legitimate brothers and right of accretion take it in the same proportion that they inherit.
sisters should be applicable to them.
o Full blood illegitimate brothers and sisters should receive  In case of predecease or disinheritance of an ascendant
double the portion of half-blood brothers and sisters; and if all (example, the father), the other ascendant entitled to inherit (the
are either of the full blood or of the half blood, they shall share mother) shall inherit in her own right and not by the right of
equally. accretion.
 The rule is different in case of incapacity or repudiation.
5. Rule No. 4 o In the event that one of the parents is incapacitated or
repudiates his or her share, the vacant portion shall accrue
ARTICLE 985, NCC. X in favor of the co-heirs, (968, 1018) who shall be entitled to
the said share in the same proportion that they inherit. (1019)
In the absence of legitimate children or descendants, the legitimate o To illustrate: The decedent died intestate survived by his
parents and ascendants shall inherit. (985) They are second in the order legitimate parents, F and M; his spouse, W; and his
of succession. illegitimate children, X and Y. He left an estate worth P1.2M.
F repudiated his share. Following the rules of intestate
(a) Effect if ascendants inherit succession, ½ of the estate, or P600,000 shall be the share of
 If there are ascendants, no collateral blood relatives (beginning with the ascendants, to be divided equally between F and M; the
the brothers and sisters) can inherit (1003), but the surviving share of W is ¼ of estate, or P300,000; and the share of X
spouse and the illegitimate children of the decedent shall inherit and Y shall be P150,000 each. Since F repudiated his share
with the ascendants. (991, 997, 1000) (P300,000) his share shall accrue in favor of the co-heirs M,
 Hence, if the decedent has no legitimate descendants, surviving W, X, and Y, in the same portion that they inherit, as follows:
spouse, and illegitimate children, the entire estate shall be  M, P300;000;
inherited by the legitimate ascendants.  W, P300.000; and
 X and Y, P150,000 each.
(b) Rule of proximity  Hence, the proportion that M inherits is 1/3 of the estate;
W, also 1/3 of the estate; X and Y, also 1/3 of the estate.
ARTICLE 986, NCC. The father and mother, if living, shall inherit in Therefore, M shall get an additional share of P100,000,
equal shares. representing 1/3 of P300,000, by right of accretion. W will
get the same share. X and Y, will be getting an additional
Should one only of them survive, he or she shall succeed to the entire share of P50,000 each,
estate of the child.
(d) Rule of concurrence
ARTICLE 987, NCC. In default of the father and mother, the ARTICLE 997, NCC. When the widow or widower survives with
ascendants nearest in degree shall inherit. legitimate parents or ascendants, the surviving spouse shall be
entitled to one-half of the estate, and the legitimate parents or
Should there be more than one of equal degree belonging to the ascendants to the other half.
same line they shall divide the inheritance per capita; should they be
of different lines but of equal degree, one-half shall go to the paternal ARTICLE 991, NCC. If legitimate ascendants are left, the illegitimate
and the other half to the maternal ascendants. In each line the children shall divide the inheritance with them, taking one-half of the
division shall be made per capita. estate, whatever be the number of the ascendants or of the
illegitimate children.
 Among the ascendants, the rule of proximity absolutely applies
because there is no representation in the ascending Iine. (972[1]) ARTICLE 1000, NCC. If legitimate ascendants, the surviving spouse,
 If both the father and mother survive, they shall inherit in equal and illegitimate children are left, the ascendants shall be entitled to
shares. (986) one-half of the inheritance, and the other half shall be divided
o Should only one of them survive, the share pertaining to the between the surviving spouse and the illegitimate children so that
ascendant shall all pertain to the survivor because the such widow or widower shall have one-fourth of the estate, and the
grandparents of the decedent are excluded. illegitimate children the other fourth.
o In default of the father and mother, the ascendants nearest in
degree shall inherit. (987) The surviving spouse and illegitimate children shall inherit with the
o If there are surviving grandparents in the paternal and legitimate ascendants. (997, 991, 1000)
maternal lines, ½ of the share pertaining to the ascendants
shall go to the paternal line and the other ½ shall go to the (a) If surviving spouse concurs:
maternal line. In each line the division shall be made per If the widow or widower survives with legitimate parents or ascendants,
capita. the surviving spouse shall be entitled to ½ of the estate, and the
legitimate parents or ascendants to the other half. (997)
(c) Effect of predecease, disinheritance, incapacity of, or
repudiation by an ascendant: (b) If illegitimate children concur
If illegitimate children survive with legitimate ascendants:
ARTICLE 968, NCC. X  ½ of the estate shall go to the ascendants and
 the other ½ of the estate shall go to the illegitimate children, to be o However, the share rendered vacant by his repudiation or
divided equally among them. (991) incapacity shall accrue to the other co-heirs, (968, 1018) who
shall take the same in the same proportion that they inherit.
(e) If both surviving spouse and illegitimate children concur (1019)
 If legitimate ascendants, the surviving spouse and illegitimate  To illustrate: The decedent died intestate, leaving an estate worth
children are left, Pl.2 million. He was survived by his wife, W, and three illegitimate
o the ascendants shall be entitled to ½ of the estate; children, X, Y, and Z. Z, however, repudiated his share or was
o the surviving spouse, ¼ of the estate; and incapacitated to inherit (and he has no descendants).
o the other ¼ shall go to the illegitimate children, to be divided o Following the rules of intestate succession, ½ of the estate, or
equally among them. (1000) P600.000, shall be the share of the wife;
o while the remaining half shall be the shares of X, Y, and Z,
6. Rule No. 5 each entitled to P200.000.
o However, since X repudiated his share, his share will accrue
ARTICLE 988, NCC. In the absence of legitimate descendants or to W, Y, and Z, in the same proportion that they inherit:
ascendants, the illegitimate children shall succeed to the entire estate  W, P600.000;
of the deceased.  Y and Z, P200,000 each.
o Hence, W gets by accretion 60% ofP200,000, orP120,000;
ARTICLE 998, NCC. If a widow or widower survives with illegitimate while Y and Z shall get 20% each of P200,000, or P40,000
children, such widow or widower shall be entitled to one-half of the each,
inheritance, and the illegitimate children or their descendants,
whether legitimate or illegitimate, to the other half. (c) Illegitimate filiation must be established
An illegitimate child, to be entitled to successional rights from the
 In the absence of legitimate descendants and ascendants, the putative or presumed parent, must prove his filiation to the latter.
illegitimate children shall inherit the entire estate of the deceased (Paulino v. Paulino)
(988), if the deceased had no surviving spouse.
 If the deceased left a widow or widower, the surviving spouse (1) An action to compel recognition may also be integrated with
shall inherit with the illegitimate children. (998) an action to claim inheritance. (Tayag v. CA)
The two causes of action, one to compel recognition and the other to
(a) Effect if illegitimate children survive claim inheritance, may be joined in one complaint.
 The collateral blood relatives of the decedent (starting from the
(2) When filiation of an illegitimate child is established by a record of
brothers and sisters) cannot inherit (1003), but the surviving spouse
birth appearing in the civil register or a final judgment, or in an
shall inherit together with the illegitimate children. (998)
admission of filiation in a public document or a private handwritten
 If a widow or widower survives with illegitimate children,
instrument signed by the parent concerned, the action for
o the surviving spouse shall be entitled to ½ of the estate, and
recognition may be brought by the child during his or her lifetime
o the illegitimate children or their descendants, whether
(Guy v. CA), and even after the death of the putative parent.
legitimate or illegitimate, shall be entitled to the other half, to
(a) On the other hand, if the action is based upon open and
be divided equally among them. (998)
continuous possession of the status of an illegitimate child, or
any other means allowed by the rules or special laws, it may
(b) Representation of illegitimate child
only be brought during the lifetime of the alleged parent;
otherwise, the action is already barred by the death of the
ARTICLE 902, NCC. X
alleged parent. (Uyguangco v. CA)
(b) Thus, upon the death of the putative parent, the only evidence
ARTICLE 989, NCC. If, together with illegitimate children, there
allowed under the law (to establish illegitimate filiation) would
should survive descendants of another illegitimate child who is dead,
be a record of birth appearing in the civil register or a final
the former shall succeed in their own right and the latter by right of
judgment, or an admission of illegitimate filiation in a public
representation.
document or a private handwritten instrument signed by the
parent concerned.
ARTICLE 990, NCC. The hereditary rights granted by the two
preceding articles to illegitimate children shall be transmitted upon 7. Rule No. 6
their death to their descendants, who shall inherit by right of
representation from their deceased grandparent. ARTICLE 995, NCC. In the absence of legitimate descendants and
ascendants, and illegitimate children and their descendants, whether
In case of predecease, incapacity, or disinheritance of an illegitimate legitimate or illegitimate, the surviving spouse shall inherit the entire
child, he can be represented by his descendants, whether the estate, without prejudice to the rights of brothers and sisters,
descendants are legitimate or illegitimate. (902, 989, 990) nephews and nieces, should there be any, under article 1001.
(a) When illegitimate child has no representative and vacancy is
by reason of predecease or disinheritance
ARTICLE 1001, NCC. Should brothers and sisters or their children
survive with the widow or widower, the latter shall be entitled to one-
He is no longer counted and the other illegitimate children shall inherit
half of the inheritance and the brothers and sisters or their children
by their own right.
to the other half.
(b) When illegitimate child has no representative and vacancy is

 In the absence of legitimate descendants and ascendants, and
by reason of incapacity or repudiation
illegitimate children and their descendants, whether legitimate
 He is still allotted a share.
or illegitimate, the surviving spouse shall inherit the entire
estate, without prejudice to the rights of brothers and sisters,

nephews and nieces, should there be any. (995, 1001) The latter shall succeed without distinction of lines or preference
 The surviving spouse is fourth in the order of succession among them by reason of relationship by the whole blood.
(a) Effect if spouse survives If there are no descendants, ascendants, illegitimate children, or a
In the absence of legitimate descendants or ascendants, and illegitimate surviving spouse, the brothers and sisters, and nephews and nieces
descendants, the surviving spouse shall inherit the entire estate to the shall succeed to the entire estate of the deceased. (1003, 1009)
exclusion of the collateral blood relatives of the decedent, except the
group of brothers and sisters, nephews and nieces. (a) Other collateral blood relatives are excluded
In intestate succession, the collateral blood relatives of the decedent are
(b) Rule of concurrence divided into two groups:
Should siblings or their children survive with the widow or widower, (1) the group of brothers, sisters, nephews, and nieces; and
the surviving spouse shall be entitled to ½ of the inheritance; and the (2) the group of other collateral blood relatives up to the fifth degree
brothers and sisters or their children shall be entitled to the other half. from the decedent.
(c) No representation of spouse  Any member of the first group shall exclude the second group.
 There is no representation of the spouse. (1009)
 In case of predecease and disinheritance of the spouse (and that  Under Article 1009, the absence of brothers, sisters, nephews,
is the only provision in the will), the group of brothers and sisters, and nieces of the decedent is a precondition to the other collaterals
nephews and nieces, shall inherit by their own right (uncles, aunts, cousins, etc.) being called to the succession.
 However, in case of incapacity or repudiation by the surviving (Abellana v. Ferraris)
spouse, the vacant portion shall accrue in favor of the co-heirs,
(968, 1018) and the latter shall lake the vacant share in the same (b) Full blood and half-blood brothers and sisters
proportion that they inherit. (1019)  Should the only survivors be brothers and sisters of the full
blood, they shall inherit in equal shares. (1004)
(d) Effect if marriage is void  Should brothers and sisters of the full blood survive together with
 The parties to a void marriage are not in fact spouses. Since the brothers and sisters of the half blood, the former shall be entitled
parties are not spouses, they cannot inherit from each other by way to a share double that of the latter. (1006)
of intestate succession (as spouses), unless they are relatives by  If only half-blood brothers and sisters survive, some on the
consanguinity within the fifth degree and the surviving spouse is father’s and some on the mother’s side, all shall inherit in equal
the only relative of the decedent. shares without distinction as to the origin of the property. (1007)
 Any interested party may still impugn the existence of a void  The rules also apply to the nephews and nieces.
marriage even after the death of one of the spouses, and said o Therefore, the full blood nephews or nieces do not exclude the
marriage may be questioned directly by filing an action attacking half-blood nephews or nieces.
the validity thereof (if celebrated under CC), or collaterally by o The only difference in their right of succession is provided in
raising it as an issue in a proceeding for the settlement of the estate Article 1008 in relation to Article 1006 which effect entitle the
of the deceased spouse. (Ninal v. Bayadog) nephews or nieces of full blood to a share double than that of
the nephews or nieces of half blood. (Bicomong v. Almanza)
(e) Effect of decree of legal separation
 If a decree of legal separation is issued, the right of the innocent (c) Application of barrier rule
spouse to inherit from the offending spouse is not affected.  If all brothers and sisters are legitimate, they can inherit from each
 If the innocent spouse is the decedent, the offending spouse is other, whether they are full blood or half-blood brothers and sisters.
disqualified to inherit by intestate succession. (63[4] FC) (1004, 1006)
 In the event of reconciliation between the spouses prior to the  If some are legitimate brothers and sisters while others are
death of the innocent spouse, the right of the offending spouse illegitimate brothers and sisters, the latter cannot inherit from the
to inherit as a legal heir shall depend upon the existence of a former and vice-versa under the barrier rule.
decree of reconciliation.  The law prohibits reciprocal succession between illegitimate
o reconciled in fact but without a decree of reconciliation, the children and legitimate children of the same parent, even though
offending spouse remains disqualified to inherit. there is unquestionably a tie of blood between them. (992)
o If a decree of reconciliation is obtained, the right of the  If all brothers and sisters are illegitimate children, they can inherit
offending spouse to inherit from the innocent spouse by ab intestato from each other. (Delgado)
intestate succession is automatically restored. This is
because the decree of reconciliation has the effect of setting (d) Right of representation within this group
aside the decree of legal separation. (66[2] FC) ARTICLE 975, NCC. When children of one or more brothers or
sisters of the deceased survive, they shall inherit from the latter by
8. Rule No. 7 representation, if they survive with their uncles or aunts. But if they
alone survive, they shall inherit in equal portions.
illegitimate children, or a surviving spouse, the collateral relatives ARTICLE 1005, NCC. Should brothers and sisters survive together
shall succeed to the entire estate of the deceased in accordance with with nephews and nieces, who are the children of the descendant’s
the following articles. brothers and sisters of the full blood, the former shall inherit per
capita, and the latter per stirpes.
ARTICLE 1009, NCC. Should there be neither brothers nor sisters,
nor children of brothers or sisters, the other collateral relatives shall  Within the group of brothers and sisters, and nephews and nieces,
succeed to the estate. the law allows representation only in favor of the children of
deceased brothers or sisters (the nephews and nieces), whether In default of persons entitled to succeed in accordance with the laws of
they be of the full blood or half blood (972[2]) but only when they intestate succession, the State shall inherit the whole estate. (1011) In
survive with their uncles or aunts. (975, 1005) our laws, the State is the ultimate heir.
 The nephews and nieces shall inherit by right of representation, or
per stirpes; while the brothers and sisters of the decedent shall (a) Escheat proceeding
inherit by their own right, or per capita. In order that the State may take possession of the property of the
 The right of representation will also apply if one or some of the decedent, the procedure for the escheat of property left without any
brothers or sisters are incapacitated to inherit, provided that their heir under the ROC must be followed. (1012) Hence, the State does
children concur with their uncles and aunts. not ipso facto become the owner of the estate left without an heir,
 However, when only nephews and nieces survive, they shall
inherit by their own right, in equal portions. (975) (b) Distribution of properties
 The same rule will also apply in case all the brothers and sisters
are incapacitated or all repudiated their shares in the inheritance. ARTICLE 1013, NCC. After the payment of debts and charges, the
o In any of these cases, the nephews and nieces succeed by personal property shall be assigned to the municipality or city where
their own right and not by the right of representation. the deceased last resided in the Philippines, and the real estate to
the municipalities or cities, respectively, in which the same is
9. Rule No. 8 situated.
If there are no descendants, ascendants, illegitimate children or If the deceased never resided in the Philippines, the whole estate
their descendants, surviving spouse, or brothers, sisters, shall be assigned to the respective municipalities or cities where the
nephews, and nieces, the other collateral blood relatives shall succeed same is located.
to the estate. (1003, 1009)
Such estate shall be for the benefit of public schools, and public
(a) Only up to fifth decree charitable institutions and centers, in such municipalities or cities.
The court shall distribute the estate as the respective needs of each
ARTICLE 1010, NCC. The right to inherit ab intestato shall not beneficiary may warrant.
extend beyond the fifth degree of relationship in the collateral line.
The court, at the instance of an interested party, or on its own motion,
In the collateral line, the right to inherit in intestate succession shall not may order the establishment of a permanent trust, so that only the
extend beyond the fifth degree of relationship from the decedent. (1010) income from the property shall be used.
(b) Rule of proximity is absolute rule (1) Pay debts and charges first;
 Within the second group of collateral blood relatives, the rule of (2) thereafter, the personal property shall be assigned to the
proximity is an absolute rule. (Bagunu v. Piedad) municipality or city where the deceased last resided in the
 Within this group, the right of representation does not apply. Philippines;
o Thus, a child of a deceased first cousin (5th degree) cannot (3) the real estate, on the other hand, shall be assigned to the
inherit together with the decedent’s other first cousins (4 th municipality or city in which the same is situated;
degree), by representing his deceased parent. (4) if the deceased never resided in the Philippines, the whole estate
o The child of the deceased first cousin is excluded by the shall be assigned to the respective municipalities or cities where
decedent’s other first cousins. the same is located; and
o a maternal aunt can inherit alongside a paternal uncle (both (5) the municipalities or cities shall make use of the estate for the
within the 3rd degree), and a first cousin of the full blood can benefit of public schools, and public charitable institutions and
inherit equally with a first cousin of the half blood, but an uncle centers, in such municipalities or cities.
or an aunt, being a third-degree relative, excludes the cousins
of the decedent, being in the fourth degree of relationship; the (c) Prescriptive period for recovery by legal heirs
latter, in turn, would have priority in succession to a fifth- ARTICLE 1014, NCC. If a person legally entitled to the estate of the
degree relative. deceased appears and files a claim thereto with the court within five
years from the date the property was delivered to the State, such
(c) No preference within same degrees person shall be entitled to the possession of the same, or if sold, the
 Within the second group of collateral blood relatives, the only rule municipality or city shall be accountable to him for such part of the
is proximity. Hence, relatives of the same degree shall succeed proceeds as may not have been lawfully spent.
without distinction of lines or preference among them by reason of
relationship by the whole blood. (1009[2] A person legally entitled to the estate of the deceased may file a claim
 For example, a child of the decedent’s nephew (4th degree relative) with the court within five years from the date the property was delivered
and a first cousin (also 4th degree relative) will both inherit from the to the State.
decedent because both are fourth degree relatives of the decedent.
O. Simplified Rules of Intestate Succession: Estate of Illegitimate
10. Rule No. 9 Decedent
ARTICLE 1011, NCC. In default of persons entitled to succeed in 1. Rule No. 1

accordance with the provisions of the preceding Sections, the State
shall inherit the whole estate. ARTICLE 993, NCC. If an illegitimate child should die without issue,
either legitimate or illegitimate, his father or mother shall succeed to
his entire estate; and if the child’s filiation is duly proved as to both
parents, who are both living, they shall inherit from him share and
share alike.
o The brothers and sisters, nephews and nieces, must be by

 If there are legitimate children or their descendants, the illegitimate illegitimate filiation; otherwise, the barrier rule, also known as
parents shall not inherit. (993) the iron curtain rule, shall apply.
 The legitimate descendants cannot exclude the decedent’s
surviving spouse and illegitimate children. 5. Rule No. 5
 As to the right of the legitimate descendants, surviving spouse and
illegitimate children to inherit from the decedent, the same rules in  If there are no children or descendants, whether legitimate or
succession to the estate of a legitimate decedent are also illegitimate, illegitimate parents, and surviving spouse, the
applicable in succession to the estate of an illegitimate decedent. illegitimate brothers and sisters, nephews and nieces, shall inherit
the entire estate. (994)
2. Rule No. 2  The rules regarding succession of legitimate brothers and sisters
should be applicable to them.
ARTICLE 998, NCC. If a widow or widower survives with illegitimate o Full blood illegitimate brothers and sisters should receive
children, such widow or widower shall be entitled to one-half of the double the portion of half-blood brothers and sisters;
inheritance, and the illegitimate children or their descendants, o and if all are either of the full blood or of the half blood, they
whether legitimate or illegitimate, to the other half. shall share equally.
 The right of representation granted to nephews and nieces, when
 In the absence of legitimate descendants, next in the order of they survive with their uncles and aunts, in Articles 972, par. 2, 975,
succession are the illegitimate children or their descendants. and 1005, should also apply in the case of illegitimate brothers and
 If there are illegitimate descendants sisters, nephews and nieces.
o the illegitimate parents cannot inherit.
o However, the surviving spouse shall inherit together with die 6. Rule No. 6
illegitimate descendants.
 If a widow or widower survives with illegitimate children  If there are no children or descendants, whether legitimate or
o such widow or widower shall be entitled to ½ of the inheritance illegitimate, illegitimate parents, surviving spouse, brothers
o illegitimate children or their descendants, whether legitimate and sisters, nephews and nieces, the entire estate shall be
or illegitimate, to the other half. (998) inherited by the State.
 Note that if the decedent is illegitimate, successional rights in
3. Rule No. 3 favor of the collateral blood relatives are granted only to the
brothers, sisters, nephews, and nieces. The other collateral
ARTICLE 990, NCC. The hereditary rights granted by the two blood relatives are no longer granted successional rights.
preceding articles to illegitimate children shall be transmitted upon
their death to their descendants, who shall inherit by right of
representation from their deceased grandparent.
 In case there are no descendants, whether legitimate or

illegitimate, the illegitimate parents shall succeed to the entire
estate. (993)
 However, if the decedent’s widow or widower survives with the
illegitimate parents, the surviving spouse shall be entitled to ½ of
the estate, and the illegitimate parents, to the other half. (997, by
analogy)
 Among the ascendants, only the parents of the illegitimate child
are granted successional rights to the estate of the latter.
 In Article 993, the other ascendants of the illegitimate decedent are
not granted successional rights to the estate of the latter.
 While an illegitimate child is allowed to inherit to the estate of the
illegitimate grandparents by representing his or her illegitimate
parents (990), the illegitimate grandparents do not have the
right to inherit from their illegitimate grandchildren. There is no
reciprocity of successional rights between them.
4. Rule No. 4
 In case there are no children or descendants, whether legitimate

or illegitimate, and illegitimate parents, the illegitimate decedent
shall be succeeded by his or her surviving spouse, who shall
be entitled to the entire share. (994[1])
 However, if the decedent’s brothers and sisters, nephews and
nieces, survive with the widow or widower,
o the surviving spouse is entitled to ½ of the estate;
o the group of brothers, sisters, nephews, and nieces, shall be
entitled to the other half. (994[2])
BOOK IV: OBLIGATIONS AND CONTRACTS the occasion in order that the obligation contained in the legal
precept may begin to be demandable.
PART 1: OBLIGATIONS
3. Contracts
A. Concept
Article 1305, NCC. A contract is a meeting of minds between two
1. Basic Concepts persons whereby one binds himself, with respect to the other, to give
something or to render some service.
Definition
Article 1156, NCC. An obligation is a juridical necessity to give, to Definition: A contract is defined as "a meeting of minds between two
do or not to do. persons whereby one binds himself, with respect to the other, to give
something or to render some service.” (1305)
 An obligation is a juridical necessity to give, to do, or not to do.  The definition lays stress on the meeting of the minds of the
 A juridical relation whereby a person (creditor) may demand from contracting parties (Lustan v. CA), for consent is the essence of a
another (debtor) the observance of a determinate conduct, and in contract. (Jalandre v. Custodio)
case of breach, may obtain satisfaction from the assets of the latter.  It is the element of consent which distinguishes contracts
(Makati Stock Exchange, Inc. v. Campos) from the other sources of obligations.
Essential Elements Obligatory Force of Contracts

(1) juridical tie or vinculum juris – the efficient cause established Article 1159, NCC. Obligations arising from contracts have the force
by the various sources of obligations (law, contracts, quasi- of law between the contracting parties and should be complied with
contracts, delicts, and quasi-delicts); in good faith.
(2) object – the prestation or the particular conduct required to be
observed by the debtor (to give, to do, or not to do);  Obligations arising from contracts have the force of law between
(3) active subject (obligee or creditor) – the person who can demand the contracting parties and should be complied with in good faith.
the fulfillment of the obligation; and  In contract law, this principle is known as the obligatory force of
(4) passive subject (obligor or debtor) – the person from whom the contracts, which presupposes the existence of a valid and
obligation is juridically demandable. enforceable contract.
(Ang Yu Asuncion v. CA)
4. Quasi-contracts
B. Sources of Obligations
Definition
1. Five Sources Article 2142, NCC. Certain lawful, voluntary and unilateral acts give
rise to the juridical relation of quasi-contract to the end that no one
Article 1157, NCC. Obligations arise from: shall be unjustly enriched or benefited at the expense of another.
(1) Law;
(2) Contracts; It is a juridical relation arising from certain lawful, voluntary, and
(3) Quasi-contracts; unilateral acts with the objective of preventing unjust enrichment or
(4) Acts or omissions punished by law; and benefit at the expense of another. (2142)
(5) Quasi-delicts. Sir: it’s born of LUV – Lawful, unilateral, voluntary act
Forms of Quasi-contracts
This enumeration is exclusive. (Makati Stock Exchange, supra) Article 2143, NCC. The provisions for quasi-contracts in this Chapter
do not exclude other quasi-contracts which may come within the
2. Law purview of the preceding article.
So long as there’s a situation of unjust enrichment, and it’s not
Must Be Expressly Provided contractual in nature, and it’s not unlawful – there can be a situation of
Article 1158, NCC. Obligations derived from law are not presumed. quasi contract even if it does not fall under the two.
Only those expressly determined in this Code or in special laws are  There are several forms of quasi-contracts enumerated in the CC
demandable, and shall be regulated by the precepts of the law which (2144-2175) but the enumeration is not exclusive. (2143)
establishes them; and as to what has not been foreseen, by the  The obligation is not contractual in nature in the absence of the
provisions of this Book. element of consent.
 Neither is the obligation based on delict or quasi-delict, if the act
 Obligations derived from law are not presumed (1158). Hence, which gives rise to it is not unlawful.
only those expressly determined in the CC or in special laws are  In those instances where there is no pre-existing contractual
demandable. relation, and there being neither a delict nor a quasi-delict, a
 These obligations are regulated: juridical relation known as quasi-contract may arise between the
o (1) by the precepts of the law which establishes them; and parties to avoid a case of unjust enrichment.
o (2) as to what has not been foreseen, by the provisions of
Book IV of the Civil Code. [1] Negotiorum Gestio
(a) Definition
When Source of Obligation Article 2144, NCC. Whoever voluntarily takes charge of the
 Law is the source of obligation when it does not merely limit itself agency or management of the business or property of another,
to enforcing compliance with an obligation originating from the without any power from the latter, is obliged to continue the same
acts of the parties, but by itself establishes the obligation, until the termination of the affair and its incidents, or to require the
making the act of the party or parties only a moment, or determining
person concerned to substitute him, if the owner is in a position to do (2) If he has preferred his own interest to that of the owner;
so. This juridical relation does not arise in either of these instances: (3) If he fails to return the property or business after demand by the
(1) When the property or business is not neglected or abandoned; owner;
(2) If in fact the manager has been tacitly authorized by the owner. (4) If he assumed the management in bad faith.
In the first case, the provisions of articles 1317, 1403, No. 1, and Article 2148, NCC. Except when the management was assumed to
1404 regarding unauthorized contracts shall govern. save the property or business from imminent danger, the officious
manager shall be liable for fortuitous events:
In the second case, the rules on agency in Title X of this Book shall (1) If he is manifestly unfit to carry on the management;
be applicable. (2) If by his intervention he prevented a more competent person
from taking up the management.
It is a juridical relation which arises when a person voluntarily takes
charge of the agency or management of another’s abandoned or Article 2152, NCC. The officious manager is personally liable for
neglected business or property without the owner’s authority. (2144) contracts which he has entered into with third persons, even though
he acted in the name of the owner, and there shall be no right of
(b) Requisites (2144, 2149) action between the owner and third persons. These provisions shall
Article 2149, NCC. The ratification of the management by the owner not apply:
of the business produces the effects of an express agency, even if (1) If the owner has expressly or tacitly ratified the management, or
the business may not have been successful. (2) When the contract refers to things pertaining to the owner of the
business.
(1) a person (called the officious manager or gestor) voluntarily
assumes the management or agency of the business or (1) he is obliged to continue with the agency or management until
property of another; the termination of the affair and its incidents and he can only
(2) the property must be neglected or abandoned; require the owner to substitute him if the latter is in a position to do
(a) otherwise, what results is a case of unauthorized/ so; (2144)
unenforceable contract and not negotiorum gestio (2) in the performance of his duties, he is obliged to observe the
(b) ABSENTEE OWNER who did not leave a caretaker, diligence of a good father of a family—if the owner suffers
administrator, or representative damage by reason of the fault or negligence of the officious
(3) there is no authorization from the owner, whether express or manager, the latter is liable to pay damages to the former (2145),
implied; but the courts may, however, increase or moderate the indemnity
(a) otherwise, what results is a contract of agency and not according to the circumstances of each case;
negotiation gestio; and (3) he is personally liable for contracts which he has entered into
(4) the assumption of agency or management must be done in good with third persons, insofar as the latter shall be concerned, even
faith. If the owner ratifies the management of the business, the though he acted in the name of the owner, (2152) hence, there shall
effects of an express agency shall be produced, even if the be no right of action between the owner and such third
business may not have been successful. (2149) persons, except
Negotiorum gestio arises from NEIGHBORLINESS. The idea is to come As a general rule, if the gestor enters into contract in relation to his
to the aid of another, not the one assuming the agency or management duties, the principle of relativity applies. It does not create a cause of
of another’s business or property. The one unjustly benefitted is the action between the third person and the owner.
OWNER, which creates a situation of unjust enrichment where the
inofficious manager incurs liabilities, damages, and expenses. (a) if the owner has ratified the management, either expressly or
tacitly; or
(c) Obligations of officious manager (b) when the contract refers to things pertaining to the owner
Article 2145, NCC. The officious manager shall perform his duties of the business;
with all the diligence of a good father of a family, and pay the (4) if he delegates to another person all or some of his duties, he is
damages which through his fault or negligence may be suffered by liable for the acts of the delegate, without prejudice to the direct
the owner of the property or business under management. obligation of the delegate to the owner; (2146)
(5) the obligation of two or more officious managers is solidary,
The courts may, however, increase or moderate the indemnity unless when the management was assumed to save the thing or
according to the circumstances of each case. business from imminent danger, in which case, their obligation is
merely joint; and
Article 2146, NCC. If the officious manager delegates to another (6) he is not, as a rule, liable for any loss or damage to the property
person all or some of his duties, he shall be liable for the acts of the or business by reason of fortuitous event. But in the following
delegate, without prejudice to the direct obligation of the latter toward situations, he is liable for any fortuitous event if he:
the owner of the business. (a) undertakes risky operations which the owner was not
accustomed to embark upon;
The responsibility of two or more officious managers shall be (b) prefers his own interest to that of the owner;
solidary, unless the management was assumed to save the thing or (c) fails to return the property or business after demand by
business from imminent danger. the owner;
(d) assumes the management in bad faith; (2147)
Article 2147, NCC. The officious manager shall be liable for any (e) is manifestly unfit to carry on the management, except
fortuitous event: when the same was assumed to save the property or business
(1) If he undertakes risky operations which the owner was not from imminent danger; and
accustomed to embark upon; (f) prevents, by his intervention, a more competent person
from taking up the management, except when the same
was assumed to save the property or business from imminent (b) Requisites
danger. (1) payment is made when there exists no binding relation between
the payor, who has no duty to pay, and the person who
GR: Gestor cannot compel the owner to takeover the management, received the payment; and
unless he can prove that the owner is in a position to take over. (2) payment is made thru mistake, and not thru liberality or some other
cause.
(d) Obligations of owner (Power Commercial & Industrial Corp. v. CA)
Article 2150, NCC. Although the officious management may not (c) Similarities with action in rem verso (ARTICLE 22)
have been expressly ratified, the owner of the property or business
who enjoys the advantages of the same shall be liable for obligations ARTICLE 22. Every person who through an act of performance by
incurred in his interest, and shall reimburse the officious manager for another, or any other means, acquires or comes into possession of
the necessary and useful expenses and for the damages which the something at the expense of the latter without just or legal ground,
latter may have suffered in the performance of his duties. shall return the same to him.
The same obligation shall be incumbent upon him when the (1) the plaintiff suffers a loss;
management had for its purpose the prevention of an imminent and (2) the defendant is correspondingly enriched;
manifest loss, although no benefit may have been derived. (3) the enrichment of the defendant is unjustified because the delivery
or payment to him is without legal or just cause;
Article 2151, NCC. Even though the owner did not derive any benefit (4) the defendant has the obligation to return what was unduly
and there has been no imminent and manifest danger to the property delivered to him; and
or business, the owner is liable as under the first paragraph of the (5) the objective is to prevent unjust enrichment,
preceding article, provided:
(1) The officious manager has acted in good faith, and (d) Distinctions between solutio indebiti and in rem verso
(2) The property or business is intact, ready to be returned to the Solutio Indebiti In Rem Verso
owner. Source of Obli Quasi-contract Law
Reason for Mistake of fact or need not be by reason of
The owner is liable to the officious manager for the following: undue mistake in a mistake, or if there was
(1) obligations incurred in his interest; payment doubtful or difficult mistake, it was a mistake
(2) necessary and useful expenses; and provision of law of law that is not doubtful
(3) damages suffered by the officious manager in the performance of nor difficult
his duties, in the following situations: Mistake must be a OTHERWISE, payment
(a) if the owner enjoys the advantages of the officious mistake of FACT, or by mistake of law may be
management; (2150) mistake of doubtful had under in rem verso
(b) if the management had for its purpose the prevention of an or difficult provision
imminent and manifest loss, although no benefit may have of law
been derived; or Prescriptive 6 years 10 years (1144[2])
(c) even if he did not derive any benefit and there has been no Period
imminent and manifest danger to the property and business
provided that the officious manager has acted in good faith Requisites for recovery under Action in Rem Verso
and the property or business is intact, ready to be returned  Loss
to the owner. (2151)  Enrichment of the defendant
 Unjust enrichment
[2] Solutio Indebiti
 Enrichment was without just cause
(a) Definition
 No other legal remedy under contract, quasi contract, delict, and
Article 2154, NCC. If something is received when there is no right
quasi-delict
to demand it, and it was unduly delivered through mistake, the
This tells us that the source of obligation is LAW.
obligation to return it arises.
ARTICLE 2155. Payment by reason of a mistake in the construction
It is a juridical relation which arises when something is received when
or application of a doubtful or difficult question of law may come
there is no right to demand it, and it was unduly delivered thru
within the scope of the preceding article.
mistake. (2154)
GR: mistake of law will not come under solutio indebiti.
Example: Overpayment of rentals – the recovery will not be based on
EXC: doubtful or difficult question of law
SOLUTIO INDEBITI. That is a violation of the contract of lease between
the parties. The cause of action is the contract of lease. This is important
This means that the mistake referred to in 2154 is MISTAKE OF FACT.
because of the prescriptive periods.
Ex. Article 526, paragraph 3: Mistake upon a doubtful or difficult question
Recovery:
of law may be the basis of good faith. – as if you committed mistake of
Solution indebiti – 6 years
fact. It’s the same treatment in 2155.
Contract – depends on whether the contract is in writing or orally entered
into
If it’s a mistake of LAW, there is still UNJUST ENRICHMENT. Recover
 1144(1) – 10 years – written
is still allowed based on IN REM VERSO.
 1145(2) – 6 years – oral
(e) Obligations in solutio indebiti
Essence of Solutio indebiti is MISTAKE.
Article 2154, NCC. If something is received when there is no right to Article 2167, NCC. When through an accident or other cause a
demand it, and it was unduly delivered through mistake, the person is injured or becomes seriously ill, and he is treated or helped
obligation to return it arises. while he is not in a condition to give consent to a contract, he shall
be liable to pay for the services of the physician or other person aiding
Article 2159, NCC. Whoever in bad faith accepts an undue payment, him, unless the service has been rendered out of pure generosity.
shall pay legal interest if a sum of money is involved, or shall be liable
for fruits received or which should have been received if the thing Article 2168, NCC. When during a fire, flood, storm, or other
produces fruits. calamity, property is saved from destruction by another person
without the knowledge of the owner, the latter is bound to pay the
He shall furthermore be answerable for any loss or impairment of the former just compensation.
thing from any cause, and for damages to the person who delivered
the thing, until it is recovered. Article 2174, NCC. When in a small community a majority of the
inhabitants of age decide upon a measure for protection against
Article 2157, NCC. The responsibility of two or more payees, when lawlessness, fire, flood, storm or other calamity, any one who objects
there has been payment of what is not due, is solidary. to the plan and refuses to contribute to the expenses but is benefited
by the project as executed shall be liable to pay his share of said
(1) the recipient has the obligation to return what has been unduly expenses.
delivered; (2154)
(2) if he acted in bad faith, he is also liable: (1) when during a fire, flood, storm, or other calamity, property is
(a) to pay legal interest, if a sum of money is involved; saved from destruction by another person without the
(b) to return the fruits he received or those which should have knowledge of the owner, the latter is bound to pay the former just
been received, if the thing produces fruits; (2159) compensation; (2168)
(c) to answer for any loss or impairment of the thing from any (2) when through an accident or other cause a person is injured
cause, until it is recovered; and or becomes seriously ill, and he is treated or helped while he is
(d) to pay damages to the person who delivered the thing, until it not in a condition to give consent to a contract, he shall be liable
is recovered; for the services of the physician or other person aiding him,
(3) if there are 2 or more payees, their responsibility is solidary. (2157) unless the service has been rendered out of pure generosity;
(2176)
[3] Other Forms of Quasi-Contracts (3) when in a small community a majority of the inhabitants of age
(a) Support and funeral expenses decide upon a measure for protection against lawlessness,
Article 2164, NCC. When, without the knowledge of the person fire, flood, storm, or other calamity, anyone who objects to the
obliged to give support, it is given by a stranger, the latter shall have plan and refuses to contribute to the expenses but is benefited
a right to claim the same from the former, unless it appears that he by the project as executed shall be liable to pay his share of said
gave it out of piety and without intention of being repaid. expenses; (2174)
Article 2165, NCC. When funeral expenses are borne by a third (c) Other situations
person, without the knowledge of those relatives who were obliged to Article 2136, NCC. The debtor cannot reacquire the enjoyment of
give support to the deceased, said relatives shall reimburse the third the immovable without first having totally paid what he owes the
person, should the latter claim reimbursement. creditor.
Article 2166, NCC. When the person obliged to support an orphan, But the latter, in order to exempt himself from the obligations imposed
or an insane or other indigent person unjustly refuses to give support upon him by the preceding article, may always compel the debtor to
to the latter, any third person may furnish support to the needy enter again upon the enjoyment of the property, except when there
individual, with right of reimbursement from the person obliged to give is a stipulation to the contrary.
support. The provisions of this article apply when the father or mother
of a child under eighteen years of age unjustly refuses to support him. Article 2173, NCC. When a third person, without the knowledge of
the debtor, pays the debt, the rights of the former are governed by
(1) if support was given by a stranger, without the knowledge of the articles 1236 and 1237.
person obliged to give support, the former has the right to claim
reimbursement from the latter unless he gave it out of piety and Article 2175, NCC. Any person who is constrained to pay the taxes
without intention of being repaid; (2165, 206 FC) of another shall be entitled to reimbursement from the latter.
(2) when support is unjustly refused by the person obliged to give
it and a third person furnished the same when urgently needed, Article 2169, NCC. When the government, upon the failure of any
the latter (third person) has the right to demand reimbursement person to comply with health or safety regulations concerning
from the former unless the same was given without the intention of property, undertakes to do the necessary work, even over his
being reimbursed—also applicable when the father or mother of a objection, he shall be liable to pay the expenses.
minor unjustly refuses to support or fails to give support to the child
when urgently needed; (207 FC; 2166) (1) a third person who pays the debtor’s indebtedness without the
(3) when funeral expenses are borne by a third person, without the latter’s knowledge is entitled to demand reimbursement but only
knowledge of the relatives who were obliged to give support to the up to the extent that the payment has benefited the debtor; (2136,
deceased, the former may claim reimbursement from the latter 2173)
(2165) (2) any person who is constrained to pay the taxes of another shall
be entitled to reimbursement from the latter; (2175) and
(b) Accident and calamities (3) when the government, upon the failure of any person to comply
with health or safety regulations concerning property,
undertakes to do the necessary work, even over his objection, o There will be no basis to review the accused’s civil liability. It
he shall be liable to pay the expenses. (2169) is ALSO EXTINGUISHED.
 But this is limited to the civil liability arising from the
5. Delicts crime.
 BUT NOT OTHER SOURCES OF CIVIL LIABILITY.
Basis of Civil Liability Ex Delicto  The same crime can give rise to TWO CIVIL LIABILITIES
Criminal liability will give rise to civil liability only if the same felonious (based on delict and based on quasi-delict)
act or omission results in damage or injury to another and is the  Prescriptive Period:
direct and proximate cause thereof. Damage or injury to another is o 1146 – 4 YEARS – QUASI DELICT
evidently the foundation of the civil action. (Banal v. Tadeo) o If a criminal action has been pending for so long, beyond the
prescriptive period of the quasi delict, what happens?
Some crimes DO NOT HAVE CIVIL LIABILITY because there is no o The running of the prescriptive period based on quasi-delict is
private offended party (ex. Coup d’état, drugs) INTERRUPTED during the pendency of the criminal action.
(Bayotas)
CRIME HAS TWO ASPECTS: Offense against the state and private o Example: Crime was committed in 2011. The criminal and civil
offended party. action based on the crime was filed in 2012. In 2012, the 4-
year prescriptive period on actions based on quasi-delict was
In quasi-delict, that is PURELY CIVIL LIABILITY. The scope of quasi interrupted. If the accused died in 2017 and the case is
delict is much broader than delict. pending, there are still 3 years left to file the case based on
quasi-delict.
Effect of Acquittal
ARTICLE 29. When the accused in a criminal prosecution is 6. Quasi Delicts
acquitted on the ground that his guilt has not been proved beyond The act which is the source of obligation is also unilateral and voluntary,
reasonable doubt, a civil action for damages for the same act or BUT UNLAWFUL.
omission may be instituted. Such action requires only a Requisites for Recovery
preponderance of evidence. Upon motion of the defendant, the court (1) damage suffered by the plaintiff;
may require the plaintiff to file a bond to answer for damages in case (2) fault or negligence of the defendant; and
the complaint should be found to be malicious. (3) connection of cause and effect between the fault or negligence of
defendant and the damage incurred by the plaintiff.
If in a criminal case the judgment of acquittal is based upon (Dy Teban Trading, Inc. v. Ching)
reasonable doubt, the court shall so declare. In the absence of any
declaration to that effect, it may be inferred from the text of the  Act or omission MUST BE THE PROXIMATE CAUSE of the injury
decision whether or not the acquittal is due to that ground. suffered by the plaintiff.
 Those are the same requirements to recover from civil liability
based on delict.
(a) If accused is declared not author of act or omission complained o BUT DELICT is limited to unlawful acts punished by LAW.
of: There is no civil liability ex delicto. (Manantan v. CA) o Nullum crimen sine lege
(1) This is the situation contemplated in Rule 111, which says that  Do we limit the scope of quasi delicts to unlawful acts not covered
the civil action based on delict shall be deemed extinguished by delict? (Barredo v. Garcia) NO
if there is a finding in a final judgment in the criminal action o Barredo: The scope of quasi delict is broader than delict. It
that the act or omission from which the civil liability may arise should not be limited to unlawful acts not covered by delict. It
did not exist. (Sec. 2[b] Rule 111, 2000 Rules of Criminal will also cover cases of NEGLIGENCE which are CRIMINAL
Procedure) in character, punished by law as crimes. The same negligent
(b) If based on reasonable doubt: act, which is criminal in character, will give rise to two sources
(1) He is not exempt from civil liability based on delict which of civil obligation: based on delict and quasi delict.
may be proved by preponderance of evidence only. o This was decided on the basis of the Spanish Civil Code.
(2) This is the situation contemplated in Article 29 CC, where the  At this time, quasi-delicts were based only on
civil action for damages is "for the same act or omission. negligence.
(Manantan) o Civil Code was totally revised in 1949 and took effect in 1950.
With the knowledge of Barredo, this is why Congress inserted
Proof beyond reasonable doubt – criminal liability a provision barring double-recovery.
Preponderance of evidence – civil liability  If committed through dolo (intentional), would it also give rise to
civil liability based on quasi-delict?
Effect of Death Pending Appeal of Judgment of Conviction o Is the concept of quasi-delict limited to cases of negligence?
 Both the criminal liability and the civil liability (arising from the o Baksh v. CA: limited to negligence (culpa aquiliana only). But
crime) are extinguished. (Art. 89, RPC) US introduced the concept of TORTS.
o During appeal, the case is NOT final o The US concept of torts includes INTENTIONAL ACTS. So
 However, the civil liability based on other sources of when congress enacted the NCC, our concept of quasi-delict
obligations (other than the delict) is not extinguished but may be included Spanish and American influences. It was no longer
recovered only by filing a separate civil action. confined to cases of negligence.
 The statute of limitations on the civil liability (based on other o 1173: fault or negligence describes the concept of CULPA
sources than delict) is deemed interrupted during the pendency of CONTRACTUAL. It uses “fault or negligence.” The word fault
the criminal case. (People v. Bayotas) carries the same meaning as negligence.
o Since the criminal liability is already extinguished, the records  On the other hand, in 2176, where fault or negligence is
must be terminated in relation to the criminal case. also used, the usage is not in the same as 1173. Fault
refers to INTENTIONAL ACTS in this provision. ARTICLE 20. Every person who, contrary to law, wilfully or negligently
Negligence pertains to unintentional acts. causes damage to another, shall indemnify the latter for the same.
o Elcano v. Hill: involved homicide. Quasi-delict also covers acts
or omissions which are criminal in character, whether Four Instances
committed intentionally, deliberately, or negligently. Fault  1170: there is a contract.
refers to intentional acts, as opposed to negligent acts which  20: no contract between the parties. The act is contrary to law.
are unintentional.  2176: negligence presupposes absence of a contract; but in St
o Thus Barredo and Elcano, in every commission of a crime, as Martin v. LWV, in Article 20 is a breach of an existing provision
long as there is a private offended party, there are two sources of law.
of obligations: delict and quasi delict. The only difference is  Air France v. Carrascoso: the negligence is also the act that breaks
that in crime, there is an action based on crime and civil the contract
liability. In quasi-delict, the liability is only civil.
o Only the civil liability based on delict is extinguished by death. If the employee committed an unlawful act, will this make the employer
liable? This will depend on the source of obligation.
Distinguished from Delict  Taxi owned by the operator. There are 3 possible sources of
Delict Quasi-delict obligation:
Affect the public interest Private concern o Breach of contract of carriage
Penal Code punishes or CC, by indemnification, merely o Crime = reckless imprudence
corrects the criminal act repairs the damage o Quasi-delict
not as broad as quasi-delicts, Include all acts in which any  Jurisprudence says that the scope of quasi-delict
because they are punished only kind of fault or negligence includes acts or omissions criminal in character whether
if there is a penal law clearly intervenes intentional or negligent.
covering them  The existence of a contract is not a bar to the recovery
(Garcia v. Barredo) of civil liability based on quasi-delict. The act that breaks
the contract is tort itself.
Scope of Quasi-delicts  Liability:
Article 2176, NCC. Whoever by act or omission causes damage o If breach of contract is the source of obligation – the
to another, there being fault or negligence, is obliged to pay for EMPLOYER is liable. The driver is not a party to the contract.
the damage done. Such fault or negligence, if there is no pre- The employee and employer cannot be held solidarily liable.
existing contractual relation between the parties, is called a quasi-  If contract, the ground for recovery is the breach of the
delict and is governed by the provisions of this Chapter. obligations of the employer in the contract. Thus, due
diligence in the selection and supervision of the
(a) Covers acts or omissions criminal in character employee is NOT a defense by the employer.
 Article 2176 CC, where it refers to “fault or negligence,” covers  What is important is the existence of the contract and
not only acts “not punishable by law" but also acts criminal in its breach. You don’t have to prove the negligence of the
character, whether intentional and voluntary or negligent. driver.
(Safeguard Security Agency, Inc. v. Tangco, Elcano v. Hill) o If crime:
 Hence, the same intentional, voluntary, or negligent act  Employee: PRIMARY liability
causing damages and punished by law may produce two kinds  Employer: SECONDARY, SUBSIDIARY liability
of civil liability:  If walang pambayad yung employee.
(a) civil liability arising from the crime under Article 100 RPC; or  They cannot be solidarily liable.
(b) civil liability arising from quasi-delict under Article 2176 CC.  Employer – IN DEFAULT OF PERSONS CRIMINALLY
LIABLE – there must be a conviction + insolvency of
(b) But double recovery not allowed the employee.
Article 2177, NCC. Responsibility for fault or negligence under the  If the employee was acquitted by reasonable doubt,
preceding article is entirely separate and distinct from the civil liability can he be liable civilly? Article 29 says yes. Only
arising from negligence under the Penal Code. But the plaintiff cannot preponderance of evidence is required.
recover damages twice for the same act or omission of the  If the employee is insolvent, can the employer be
defendant. held civilly liable? NO, because the employee was
acquitted. The employer can only be held liable if
CC expressly prohibits the plaintiff from recovering damages twice the employee was CONVICTED.
under delict and quasi-delict “for the same act or omission” of the  In practice, thus you need PROOF BEYOND
defendant. REASONABLE DOUBT to be able to hold the
employer liable in case of insolvency. But the
(c) Effect of pre-existing contractual relations advantage is the employer does not have a
 GR: the pre-existing contract between the parties may bar the defense. The employer is automatically liable.
applicability of the law on quasi-delict. (Coca-Cola Brothers PH,
Inc. v. CA) Article 102, RPC. Subsidiary civil liability of innkeepers,
 EXC: the existence of a contract between the parties does not bar tavernkeepers and proprietors of establishments. - In default of the
the commission of a tort (quasi-delict) by one against the other and persons criminally liable, innkeepers, tavernkeepers, and any
the consequent recovery of damages therefor, when the act that other persons or corporations shall be civilly liable for crimes
breaks the contract is also a tort. (Air France v. Carrascoso) committed in their establishments, in all cases where a violation of
 Ask yourself: if without the contract, you can recover, then the municipal ordinances or some general or special police regulation
contract is not a bar. shall have been committed by them or their employees.
Innkeepers are also subsidiarily liable for the restitution of goods fulfillment by the obligor, they authorize the retention of what has
taken by robbery or theft within their houses from guests lodging been delivered or rendered by reason thereof. Some natural
therein, or for the payment of the value thereof, provided that such obligations are set forth in the following articles.
guests shall have notified in advance the innkeeper himself, or the
person representing him, of the deposit of such goods within the inn;  Civil Obligation: One which gives a right of action to compel its
and shall furthermore have followed the directions which such performance. A civil obligation is one which provides for a legal
innkeeper or his representative may have given them with respect to sanction in case of its breach.
the care and vigilance over such goods. No liability shall attach in  Natural Obligation: One which does not grant a right of action
case of robbery with violence against or intimidation of persons to enforce its performance, but after voluntary fulfillment by
unless committed by the innkeeper's employees. the debtor, it authorizes the retention of what has been
delivered or rendered by reason thereof. In other words, this kind
Article 103. Subsidiary civil liability of other persons. - The subsidiary of obligation does not provide for a legal sanction in case of
liability established in the next preceding article shall also apply to non-performance. (1423)
employers, teachers, persons, and corporations engaged in any
kind of industry for felonies committed by their servants, pupils, 2. Legal Consequences of Natural Obligations
workmen, apprentices, or employees in the discharge of their
duties. Effect of Voluntary Fulfillment
While it does not grant a right of action to enforce its performance, a
o If quasi-delict: natural obligation grants the creditor the right to retain what has been
 You may sue the employer alone for the employer’s delivered by reason thereof after the same has been voluntarily fulfilled
presumed negligence in selecting and supervising his by the debtor. (1423)
employee (vicarious liability) or for the employee’s own
liability. May Be Converted into Civil Obligation
 Defense: Due diligence in selection and supervision Article 2052, NCC. A guaranty cannot exist without a valid obligation.
of the employee.
 Negligence of the employer and employee are the Nevertheless, a guaranty may be constituted to guarantee the
proximate cause of the damage suffered by the plaintiff. performance of a voidable or an unenforceable contract. It may also
 If they are sued together, can you divide the guarantee a natural obligation.
liability? NO. The nature of their obligation requires
SOLIDARITY. You cannot apportion the liability for Article 2086, NCC. The provisions of article 2052 are applicable to a
the damage suffered by the plaintiff. pledge or mortgage.
 ARTICLE 2194. The responsibility of two or more
persons who are liable for quasi-delict is solidary.  A natural obligation may again be converted into a civil obligation:
o Even in the absence of 2194, it’s still solidary. o by reason of novation or
o when it has been made the subject matter of a contract of
guaranty, pledge, or mortgage. (2052 [2], 2086)
(d) Culpa contractual distinguished from culpa extra contractual  In novation, its first requisite is that there must be a valid previous
(culpa aquiliana) obligation.
o The first requisite does not require that the obligation be a civil
Culpa Contractual Culpa extra contractual (culpa one because even a natural obligation can be novated.
aquiliana) o A prescribed debt is a natural obligation which can be the
Source of obligation is contract Quasi delict subject matter of novation. (Villaroel v. Estrada)
Negligence is merely the negligence is substantive
incidental to the performance and independent in that it is the Cannot Be Subject Matter of Legal Compensation
of an already existing obligation negligence itself which Article 1279[4], NCC. In order that compensation may be proper, it
(arising from contracts) and that creates the vinculum is necessary:
the vinculum juris exists (4) That they be liquidated and demandable;
independently of the negligence
proof of the contract and of its the burden of proof rests upon Since legal compensation requires that both obligations be
non-performance is sufficient the plaintiff to prove the demandable (1279[4]), a natural obligation cannot be the subject
prima facie to warrant recovery, negligence and failure to do so matter of legal compensation because it is not legally demandable.
hence, it is not necessary to shall result in the dismissal of the
prove the negligence action 3. Important Examples of Natural Obligations
Quasi-delicts are a kind of extra-contractual obligations. The other is
quasi-contracts. When Right to Sue Has Prescribed
Article 1424, NCC. When a right to sue upon a civil obligation has
C. Kinds of Obligations lapsed by extinctive prescription, the obligor who voluntarily
performs the contract cannot recover what he has delivered or
1. Classification of Obligations Based on Juridical Quality / the value of the service he has rendered.
Efficaciousness
Article 1425, NCC. When without the knowledge or against the will
Article 1423, NCC. Obligations are civil or natural. Civil obligations of the debtor, a third person pays a debt which the obligor is not
give a right of action to compel their performance. Natural obligations, legally bound to pay because the action thereon has prescribed,
not being based on positive law but on equity and natural law, do not but the debtor later voluntarily reimburses the third person, the
grant a right of action to enforce their performance, but after voluntary obligor cannot recover what he has paid.
deceased, the payment is valid and cannot be rescinded by the

Article 1236, NCC. The creditor is not bound to accept payment payer.
or performance by a third person who has no interest in the
fulfillment of the obligation, unless there is a stipulation to the Article 1430, NCC. When a will is declared void because it has not
contrary. been executed in accordance with the formalities required by law, but
one of the intestate heirs, after the settlement of the debts of the
Whoever pays for another may demand from the debtor what he deceased, pays a legacy in compliance with a clause in the defective
has paid, except that if he paid without the knowledge or against will, the payment is effective and irrevocable.
the will of the debtor, he can recover only insofar as the payment
has been beneficial to the debtor.  The rule is that an heir is not liable beyond the value of the
property he received from the decedent. (1311[1])
 When the right to sue upon a civil obligation has lapsed by  But when he voluntarily pays a debt of the decedent exceeding the
extinctive prescription (or barred by statute of limitations), the value of the property which he received by will or by the law of
obligation is converted into a natural obligation. (1424) intestacy from the estate of the deceased, the payment is valid
 In relation thereto, when without the knowledge or against the will and cannot be rescinded by the payor. (1429)
of the debtor, a third person pays a debt which the obligor is  In the same way, when a will is declared void because it has
not legally bound to pay because the action thereon has not been executed in accordance with the formalities required
prescribed, the latter (third person) may not demand by law, the estate shall pass to the legal or intestate heirs by the
reimbursement from the former because such payment has not law of intestacy.
been beneficial to the debtor. (1236[2]) o But if one of the intestate heirs, after the settlement of the
 The obligation of the debtor to the third-party payor is not civil, but debts of the deceased, pays a legacy in compliance with a
a natural one. Hence, if the debtor later voluntarily reimburses clause in the defective will, the payment is effective and
the third person, he cannot recover what he has paid. (1425) irrevocable. (1430)
No Agreement in Writing for Payment of Monetary Interest D. Kinds of Obligations: Real and Personal
Article 1956, NCC. No interest shall be due unless it has been
expressly stipulated in writing. 1. Classifications of Obligations Based on Prestation
Article 1960, NCC. If the borrower pays interest when there has Kinds of Obligations
been no stipulation therefor, the provisions of this Code concerning (a) Real Obligation –involves an obligation to give or to deliver;
solutio indebiti, or natural obligations, shall be applied, as the case (b) Personal Obligation –involves an obligation to do or not to do.
may be.
Two Kinds of Real Obligations
 The debtor may not be compelled to pay monetary interest on Article 1460, NCC. A thing is determinate when it is particularly
a loan unless the same has been expressly stipulated in writing. designated or physically segregated from all others of the same
(1956) class.
 However, if the borrower voluntarily pays the monetary interest
in the absence of stipulation, he cannot recover the same The requisite that a thing be determinate is satisfied if at the time the
because such voluntary payment is a case of natural obligation. contract is entered into, the thing is capable of being made
(1960) determinate without the necessity of a new or further agreement
 But if the payment of the interest was by reason of mistake, the between the parties.
debtor may still recover it pursuant to solutio indebiti
(1) Determinate or Specific Obligation – One which involves an
When Action has Failed obligation to deliver a determinate or specific thing;
Article 1428, NCC. When, after an action to enforce a civil obligation (2) Indeterminate or Generic Obligation – One which involves the
has failed the defendant voluntarily performs the obligation, he obligation to deliver an indeterminate or generic thing.
cannot demand the return of what he has delivered or the payment (a) determinate or specific: particularly designated or
of the value of the service he has rendered. physically segregated from all others of the same class or
species. (1460)
When, after an action to enforce a civil obligation has failed, the (b) generic: designated merely by its class or genus.
defendant voluntarily performs the obligation, he cannot demand the
return of what he has delivered or the payment of the value of the service Two Kinds of Personal Obligations
he has rendered. (1) Positive Personal Obligation – involves an obligation to do;
(2) Negative Personal Obligation –involves an obligation not to do.
When There is No Legal Obligation to Pay in Succession by Will
Article 1311[1], NCC. Contracts take effect only between the parties, 2. Legal Consequences of Determinate Obligations
their assigns and heirs, except in case where the rights and
obligations arising from the contract are not transmissible by their As to Performance
nature, or by stipulation or by provision of law. The heir is not liable Article 1244, NCC. The debtor of a thing cannot compel the
beyond the value of the property he received from the decedent. creditor to receive a different one, although the latter may be of
the same value as, or more valuable than that which is due.
Article 1429, NCC. When a testate or intestate heir voluntarily pays
a debt of the decedent exceeding the value of the property which he In obligations to do or not to do, an act or forbearance cannot be
received by will or by the law of intestacy from the estate of the substituted by another act or forbearance against the obligee’s will.
The debtor of a thing cannot compel the creditor to receive a Article 1246, NCC. When the obligation consists in the delivery of an
different one, although the latter may be of the same value as, or more indeterminate or generic thing, whose quality and circumstances
valuable than that which is due. (1244) have not been stated, the creditor cannot demand a thing of superior
quality. Neither can the debtor deliver a thing of inferior quality. The
Three Accessory Obligations purpose of the obligation and other circumstances shall be taken into
Article 1163, NCC. Every person obliged to give something is also consideration.
obliged to take care of it with the proper diligence of a good father
of a family, unless the law or the stipulation of the parties requires When the obligation consists in the delivery of an indeterminate or
another standard of care. generic thing, whose quality and circumstances have not been stated,
the creditor cannot demand a thing of superior quality. Neither can
Article 1166, NCC. The obligation to give a determinate thing the debtor deliver a thing of inferior quality.
includes that of delivering all its accessions and accessories,
even though they may not have been mentioned. Remedies in case of Breach
Article 1165[2], NCC. X
In every determinate obligation, there are three accessory obligations,
in addition to the obligation to deliver the specific thing due: Article 1170, NCC. Those who in the performance of their obligations
(1) to preserve the thing to be delivered with the proper diligence of are guilty of fraud, negligence, or delay, and those who in any
a good father of a family, unless the law or the stipulation of the manner contravene the tenor thereof, are liable for damages.
parties requires another standard of care; (1163)
(2) to deliver also all the accessions and accessories, even though The creditor can either:
they may not have been mentioned; (1166) and (1) ask another person to comply with the obligation at the
(3) to deliver the fruits if the creditor is already entitled to the same. expense of the debtor; (1162[2]) or
 The creditor acquires a right to demand for the delivery of the fruits (2) compel the debtor himself to make the delivery, plus damages
of the determinate thing due from the time the obligation to in either case. (1170)
deliver the determinate thing arises.
 In obligations to deliver a determinate thing by reason of Not Susceptible to Extinguishment by Way of Loss
contract, the obligation to deliver the principal thing arises at Article 1263, NCC. In an obligation to deliver a generic thing, the
the time of perfection of the contract, unless the obligation is loss or destruction of anything of the same kind does not extinguish
subject to a suspensive condition, in which case, the obligation the obligation.
arises only upon the happening of the said condition. (1181)
A generic obligation is not susceptible to extinguishment by reason of
Remedies in Case of Breach loss because the genus of a thing never perishes (genus nunquam peril).
Article 1165, NCC. When what is to be delivered is a determinate
thing, the creditor, in addition to the right granted him by article 1170, 4. Legal Consequences of Positive and Negative Personal
may compel the debtor to make the delivery. Obligations
If the thing is indeterminate or generic, he may ask that the obligation [A] Remedies in Case of Breach of Obligation to Do
be complied with at the expense of the debtor. (a) When considered breach
Article 1167, NCC. If a person obliged to do something fails to do it,
If the obligor delays, or has promised to deliver the same thing to two the same shall be executed at his cost.
or more persons who do not have the same interest, he shall be
responsible for any fortuitous event until he has effected the delivery. This same rule shall be observed if he does it in contravention of the
1170: Damages (fraud, negligence, delay, contravention of tenor) tenor of the obligation. Furthermore, it may be decreed that what has
The creditor can compel the debtor to deliver the determinate thing due been poorly done be undone.
in an action for specific performance, with a right to recover damages.
Not only in case of nonperformance but also when the performance
Susceptibility to Extinguishment by Way of Loss is either poor or in contravention of the tenor of the obligation.
Article 1262, NCC. An obligation which consists in the delivery of a
determinate thing shall be extinguished if it should be lost or (b) Remedies
destroyed without the fault of the debtor, and before he has Article 1167, NCC. If a person obliged to do something fails to do it,
incurred in delay. the same shall be executed at his cost.
When by law or stipulation, the obligor is liable even for fortuitous This same rule shall be observed if he does it in contravention of the
events, the loss of the thing does not extinguish the obligation, and tenor of the obligation. Furthermore, it may be decreed that what has
he shall be responsible for damages. The same rule applies when been poorly done be undone.
the nature of the obligation requires the assumption of risk.
Article III, Sec. 18[2], CONSTI. X
A determinate obligation can be extinguished by reason of loss if:
(1) the loss is without the debtor’s fault; and  non-performance: the remedy is to ask another person to
(2) it was lost before he has incurred in delay. (1262) execute the act at the cost of the debtor, plus damages.
o If the obligation is personal only to the debtor, the only
3. Legal Consequences of Generic Obligations remedy is to recover damages.
o The debtor may not be compelled to execute the act against
As to Performance his will because the same is tantamount to involuntary
servitude, which is prohibited by the Constitution.
 If the obligation to do was done poorly or in contravention of the incumbent upon him. From the moment one of the parties fulfills his
tenor of the obligation, there is an additional remedy of demanding obligation, delay by the other begins.
for the undoing of what has been done at the expense of the debtor.
(a) Requisites
[B] Remedies in Case of Breach of Obligation Not to Do: (1) the obligation be demandable and already liquidated;
(a) When considered breach: If the obligor does what he is forbidden (2) the debtor delays performance; and
to do. (3) the creditor requires the performance judicially or
(b) Remedies extrajudicially. (SSS v. Moonwalk Development)
o Once the creditor makes a demand, whether judicial or
Article 1168, NCC. When the obligation consists in not doing, and extrajudicial, the debtor incurs mora or delay. (1169)
the obligor does what has been forbidden him, it shall also be undone o Hence, absent any demand from the obligee, the obligor does
at his expense. not incur delay. (Solid Homes, Inc. v. CA)
Article 1170, NCC. Those who in the performance of their obligations (b) Exceptions to requirement of demand
are guilty of fraud, negligence, or delay, and those who in any manner (1) when the obligation expressly so declares;
contravene the tenor thereof, are liable for damages. (2) when the law expressly so declares;
(3) when from the nature and the circumstances of the obligation it
 To demand for the undoing of what has been done at the expense appears that time was the controlling motive for the
of the obligor, (1168) in addition to the creditor’s right to recover establishment of the contract; or
damages. (1170) (4) when demand would be useless, as when the obligor has
 If it becomes physically or legally impossible to exercise the right rendered it beyond his power to perform. (1169)
to demand the undoing of what has been done, the remedy of the
creditor is simply to recover damages from the debtor. (c) Effects of mora solvendi
(1) debtor becomes liable for damages, referred to as “compensatory
E. Breach of Obligations interests” (1170)
(2) the debtor remains liable if the thing was lost after he has
1. Cause of Non-Performance of Obligations incurred in delay even if the loss was without his fault (1262) or
by reason of fortuitous event; and (1165)
Involuntary Cause (3) the prescriptive period within which the obligee may bring an action
A cause which is without the debtor’s fault, or independent of his against the obligor does not commence to run until a demand is
will, such as fortuitous event or force majeure, or fault of someone else. made. (Solid Homes)
Voluntary Cause [2] Requisites of Mora Accipiendi

Causes which are due to the debtor’s fault, or by reason of his will: (1) An offer of performance by the debtor who has the required
(1) mora or delay; capacity;
(2) dolo or fraud; (2) the offer must be to comply with the prestation as it should be
(3) culpa or negligence; and performed; and
(4) contravention of the tenor of the obligation. (3) the creditor refuses the performance without just cause.
(Solid Homes)
2. Mora or Delay
[3] Delay in Reciprocal Obligations
Kinds of Delay (a) Concept of reciprocal obligations
(1) mora solvendi – delay on the part of the debtor;  Reciprocal obligations are those which arise from the same cause,
(2) mora accipiendi – delay on the part of the creditor; and and which each party is a debtor and a creditor of the other,
(3) compensation morae – delay on the part of both parties because such that the obligation of one is dependent upon the obligation of
neither has completed their part in their reciprocal obligation. the other. (Cortes v. CA)
(Cortes v. CA)  They are to be performed simultaneously, so that the performance
of one is conditioned upon the simultaneous fulfillment of the other.
[1] Mora Solvendi
Article 1169, NCC. Those obliged to deliver or to do something incur (b) When delay exists
in delay from the time the obligee judicially or extrajudicially demands  The mutual inaction of the parties gives rise to compensation
from them the fulfillment of their obligation. morae.
 In other words, if both did not perform, the delay of one is
However, the demand by the creditor shall not be necessary in order cancelled out by the delay of the other. Hence, there is no delay.
that delay may exist:  But from the moment one of the parties fulfills his obligation,
(1) When the obligation or the law expressly so declare; or delay by the other begins, without the necessity of a demand.
(2) When from the nature and the circumstances of the obligation it (1169, Solar Harvest, Inc. v. Davao Corrugated Carton Corp.)
appears that the designation of the time when the thing is to be  But demand is necessary when different dates for
delivered or the service is to be rendered was a controlling performance are fixed for the obligations.
motive for the establishment of the contract; or
(3) When demand would be useless, as when the obligor has 3. Dolo (Fraud) and Culpa (Negligence)
rendered it beyond his power to perform.
Dolo (fraud)
In reciprocal obligations, neither party incurs in delay if the other does Article 1171, NCC. Responsibility arising from fraud is demandable
not comply or is not ready to comply in a proper manner with what is in all obligations. Any waiver of an action for future fraud is void.
(a) Concept: It is the deliberate and intentional evasion of the normal o The whole occurrence is humanized and removed from the
fulfillment of obligations. rules applicable to a fortuitous event. (Asset Privatization;
(b) Prohibited Waiver: Any waiver of an action for future fraud is Sicam)
void. (1171)
Exceptions to Fortuitous Event
Negligence (culpa contractual). (1) when the law expressly so specifies;
Article 1173, NCC. The fault or negligence of the obligor consists in (2) when it is otherwise declared by the parties; and
the omission of that diligence which is required by the nature of the (3) when the nature of the obligation requires the assumption of risks
obligation and corresponds with the circumstances of the persons, of
the time and of the place. When negligence shows bad faith, the F. Kinds of Obligations: Pure, Conditional, and With a Term
provisions of articles 1171 and 2201, paragraph 2, shall apply.
1. Classification of Obligations Based on Absence /
If the law or contract does not state the diligence which is to be Presence of Condition or Term
observed in the performance, that which is expected of a good father
of a family shall be required. (1) Pure Obligation: Obligation is not subject to any condition or term
(period).
(a) Concept: It is the fault or negligence incident in the (2) Conditional Obligation: One which is subject to a condition.
performance of an obligation which already existed, and which (3) Obligation With a Term: An obligation whose effects are
increases the liability from such already existing obligation, subjected in one way or another to the expiration of a term.
(b) Prohibited waiver: When negligence shows bad faith it is
tantamount to fraud. Hence, any waiver of an action for future 2. Pure Obligations
negligence showing bad faith is also void. (1173, in rel. to 1171)
Article 1179, NCC. Every obligation whose performance does not
4. Fortuitous Event (Caso Fortuito) depend upon a future or uncertain event, or upon a past event
unknown to the parties, is demandable at once.
Definition
 Fortuitous events by definition are extraordinary events not Every obligation which contains a resolutory condition shall also be
foreseeable or avoidable. demandable, without prejudice to the effects of the happening of the
o It is not enough that the event should not have been foreseen event.
or anticipated, but it must be one impossible to foresee or
to avoid. Article 1193[2], NCC. Obligations for whose fulfillment a day certain
o The mere difficulty to foresee the happening is not has been fixed, shall be demandable only when that day comes.
impossibility to foresee the same. (Sicam v. Jorge)
 It may either be Obligations with a resolutory period take effect at once, but terminate
o an act of God, or natural occurrences such as floods or upon arrival of the day certain.
typhoons (known as “fortuitous event proper”), or
o an act of man (force majeure) such as riots, strikes, or wars. A day certain is understood to be that which must necessarily come,
(Asset Privatization Trust v. T.J. Enterprises) although it may not be known when.
Effect and Requisites If the uncertainty consists in whether the day will come or not, the
Article 1174, NCC. Except in cases expressly specified by the law, obligation is conditional, and it shall be regulated by the rules of the
or when it is otherwise declared by stipulation, or when the nature of preceding Section.
the obligation requires the assumption of risk, no person shall be
responsible for those events which could not be foreseen, or which, Effect: The obligation already exists and it is already demandable. In
though foreseen, were inevitable. other words, the obligation is immediately demandable. (1179[1])
GR: no person shall be responsible for a fortuitous event. (1174) Other Obligations which are Immediately Demandable:
 Hence, the obligor, as a rule, is not liable for any loss or (1) obligation subject to a resolutory condition; and
deterioration caused by a fortuitous event. (2) obligation subject to a resolutory term. (1179[2], 1193[2])
Requisites 3. Conditional Obligation

(1) the cause of the breach of the obligation must be independent of
the will of the debtor; Definition
(2) the event must be either unforeseeable or unavoidable;  It is an uncertain event which wields an influence on a legal relation.
(3) the event must be such as to render it impossible for the debtor  It is also defined as every future and uncertain event upon which
to fulfill his obligation in a normal manner; and an obligation or provision is made to depend.
(4) the debtor must be free from any participation in, or aggravation
of, the injury to the creditor. (Mondragon Leisure and Resorts Corp. Kinds of Conditions
v. CA) (1) Suspensive or Resolutory – effect is on the existence of the
 If the negligence or fault of the obligor coincided with the obligation;
occurrence of the fortuitous event, and caused the loss or (2) Potestative, Casual, or Mixed – effect is on the validity of the
damage or the aggravation thereof, the fortuitous event cannot obligation
shield the obligor from liability for his negligence. (College (3) Possible and Impossible – effect is on the validity of the
Assurance Plan v. Belfrant Development, Inc.) obligation; and
(4) Positive and Negative – effect is on the determination of the
effectivity of the obligation.
(6) If it is improved at the expense of the debtor, he shall have no

[1] Suspensive and Resolutory other right than that granted to the usufructuary.
(a) Suspensive Condition
Article 1181, NCC. In conditional obligations, the acquisition of Effect
rights, as well as the extinguishment or loss of those already Lost without fault of debtor Obligation is extinguished
acquired, shall depend upon the happening of the event which Lost through fault Obligation is converted to payment
constitutes the condition. of damages
Deteriorates without fault Impairment borne by creditor
Article 1188, NCC. The creditor may, before the fulfillment of the Deteriorates through fault creditor may choose between the
condition, bring the appropriate actions for the preservation of his rescission of the obligation and its
right. fulfillment, with damages in either
case
The debtor may recover what during the same time he has paid by improved by its nature, or by improvement shall inure to the
mistake in case of a suspensive condition. time benefit of the creditor
improved at the expense of improvement if the removal can be
 Obligation arises only upon the fulfillment of the condition. If the debtor done without injuring the thing due
the condition is not fulfilled, the obligation does not arise. (1181)
 During the pendency of the condition, however, the creditor has the (d) Resolutory Condition
right to take necessary measures to preserve and protect his  Obligation already exists but the same is extinguished upon
inchoate interest. (1188) the fulfillment of the condition. (1181)
 Hence, it is immediately demandable. (1179[2])
(b) Effect of fulfillment of condition  Upon performance of the obligation by the debtor, the condition
Article 1187, NCC. The effects of a conditional obligation to give, becomes a suspensive condition as to him.
once the condition has been fulfilled, shall retroact to the day of the
constitution of the obligation. Nevertheless, when the obligation (e) Effect of fulfillment of condition
imposes reciprocal prestations upon the parties, the fruits and Article 1190, NCC. When the conditions have for their purpose the
interests during the pendency of the condition shall be deemed to extinguishment of an obligation to give, the parties, upon the
have been mutually compensated. If the obligation is unilateral, the fulfillment of said conditions, shall return to each other what they have
debtor shall appropriate the fruits and interests received, unless from received.
the nature and circumstances of the obligation it should be inferred
that the intention of the person constituting the same was different. In case of the loss, deterioration or improvement of the thing, the
provisions which, with respect to the debtor, are laid down in the
In obligations to do and not to do, the courts shall determine, in each preceding article shall be applied to the party who is bound to return.
case, the retroactive effect of the condition that has been complied
with. As for obligations to do and not to do, the provisions of the second
paragraph of article 1187 shall be observed as regards the effect of
 The effects in an obligation to give shall retroact to the day of the extinguishment of the obligation.
the constitution of the obligation.
o However, when the obligation imposes reciprocal  Obligation is extinguished. (1181)
prestations, the fruits and interests are deemed mutually
 In obligations to give, the parties shall return to each other what
compensated. (1187)
they have received. (1190)
 In obligations to do and not to do, courts shall determine, in each
case, the retroactive effects. [2] Tacit Resolutory Condition in Reciprocal Obligations:
(a) Reciprocal Obligation
(c) Effect of loss, deterioration, or improvement of determinate
 Reciprocal obligations arise from the same cause, and in which
thing prior to fulfillment of condition
each party is a debtor and a creditor of the other, such that the
Article 1189, NCC. When the conditions have been imposed with the obligation of one is dependent upon the obligation of the other.
intention of suspending the efficacy of an obligation to give, the
 They are performed simultaneously such that the performance
following rules shall be observed in case of the improvement, loss
of one is conditioned upon the simultaneous fulfillment of the other.
or deterioration of the thing during the pendency of the condition:
(Heirs of Antonio Bernabe v. CA)
(1) If the thing is lost without the fault of the debtor, the obligation
shall be extinguished;
(b) Tacit Resolutory Condition
(2) If the thing is lost through the fault of the debtor, he shall be
 The power to rescind obligations is implied in reciprocal ones,
obliged to pay damages; it is understood that the thing is lost
in case one of the obligors should not comply with what is
when it perishes, or goes out of commerce, or disappears in
incumbent upon him (1191[1]),
such a way that its existence is unknown or it cannot be
o "absent any provision providing for a right to rescind, the
recovered;
parties may nevertheless rescind the contract should the
(3) When the thing deteriorates without the fault of the debtor, the
other obligor fail to comply with its obligations. (Casiño v. CA)
impairment is to be borne by the creditor;
 But the power to rescind must be invoked judicially.
(4) If it deteriorates through the fault of the debtor, the creditor may
choose between the rescission of the obligation and its
(c) Not absolute right
fulfillment, with indemnity for damages in either case;
Rescission will not be permitted for slight or casual breach of the
(5) If the thing is improved by its nature, or by time, the
contract, but only for such breaches as are so substantial and
improvement shall inure to the benefit of the creditor;
fundamental as to defeat the object of the parties in making the
agreement. (Song Fo & Company v. Hawaiian-PH Co.; Yaneza v. CA)
When the fulfillment of the condition is entirely dependent upon chance

(d) Prescriptive period for action to rescind based on Article 1191 or upon the will of a third person, in which case the obligation is valid
Article 1191. The power to rescind obligations is implied in reciprocal and will take effect in conformity with the Civil Code. (Taylor, supra)
ones, in case one of the obligors should not comply with what is
incumbent upon him. (c) Mixed Condition
When the fulfillment of the condition is partly dependent upon the will of
The injured party may choose between the fulfillment and the either of the parties and partly upon chance or the will of a third
rescission of the obligation, with the payment of damages in either person, in which case the obligation is valid.
case. He may also seek rescission, even after he has chosen
fulfillment, if the latter should become impossible. (d) Doctrine of Constructive Fulfillment of Suspensive Condition
Article 1186, NCC. The condition shall be deemed fulfilled when the
The court shall decree the rescission claimed, unless there be just obligor voluntarily prevents its fulfillment.
cause authorizing the fixing of a period.
When the condition is mixed, suspensive, partly dependent upon
This is understood to be without prejudice to the rights of third the will of the debtor, and the latter intentionally prevents the
persons who have acquired the thing, in accordance with articles fulfillment of the condition dependent on him, the entire condition is
1385 and 1388 and the Mortgage Law. deemed constructively fulfilled (1186).
Article 1144[1], NCC. The following actions must be brought within (e) Rule on Constructive Fulfillment of Mixed Conditional
ten years from the time the right of action accrues: Obligation
(1) Upon a written contract; When the condition is mixed, suspensive, partly dependent upon the will
of the debtor and partly dependent upon the will of a third person, and
Article 1145[1], NCC. The following actions must be commenced the debtor did all in his power to comply but the condition is not fulfilled
within six years: because of the third person over whom the debtor has no control,
(1) Upon an oral contract; the entire condition is deemed constructively fulfilled. (International
Hotel Corp. v. Joaquin, Jr.)
 10 years from accrual of the right of action, for written contracts
(1144[1]) [4] Possible and Impossible Conditions
 six years, for verbal contracts. (1145[1]) (a) Possible Condition
When the condition is not contrary to the law of nature, or not
(e) If both committed breach contrary to good customs or public policy, or not prohibited by law.
Article 1192, NCC. In case both parties have committed a breach
of the obligation, the liability of the first infractor shall be equitably (b) Impossible Condition
tempered by the courts. If it cannot be determined which of the When the condition is contrary to the law of nature (physical
parties first violated the contract, the same shall be deemed impossibility), or contrary to good customs or public policy, or
extinguished, and each shall bear his own damages. prohibited by law (legal impossibility),
(c) Effect of Impossible Condition

 If it can be determined who the first infractor is, the first
Article 1183, NCC. Impossible conditions, those contrary to good
infractor is liable for damages but the same shall be equitably
customs or public policy and those prohibited by law shall annul the
tempered by the courts (1192), since the second infractor also
obligation which depends upon them. If the obligation is divisible, that
derived or thought he would derive some advantage by his own act
part thereof which is not affected by the impossible or unlawful
or neglect. (Ong v. Bogñalbal)
condition shall be valid.
 If it cannot be determined who the first infractor is, the obligations
are deemed extinguished and each shall bear his own damages.
The condition not to do an impossible thing shall be considered as
not having been agreed upon.
[3] Potestative, Casual, and Mixed Conditions
(a) Potestative Condition
Article 727, NCC. X
Article 1182, NCC. When the fulfillment of the condition depends
upon the sole will of the debtor, the conditional obligation shall be
void. If it depends upon chance or upon the will of a third person, the Article 873, NCC. X
obligation shall take effect in conformity with the provisions of this
Code. (1) On obligation: The obligation becomes void. (1183)
(2) On simple and remuneratorv donations: The condition is
 When the fulfillment of the condition is exclusively dependent considered not imposed. (727) Hence, the donation remains valid.
upon the will of either the debtor or creditor. (3) On testamentary dispositions: The condition is considered not
imposed. (873) Hence, the testamentary disposition remains valid.
 If the condition is potestative on the part of the debtor and
o At the same time suspensive, the obligation becomes void;
[5] Positive and Negative Conditions
(1182)
(a) Positive Condition: A condition that a certain event will happen
o At the same time resolutory, the obligation is valid. (Taylor
within a specific period has the effect of extinguishing the
v. Uy Tieng)
obligation dependent upon such condition from the moment:
 If the condition is potestative on the part of the creditor the
(1) said period lapses without the condition having been fulfilled;
obligation is valid.
or
(2) when it becomes certain that the event will not take place,
(b) Casual Condition
even before said period expires.
(b) Negative Condition: A condition that some event will not happen Benefit of Term
at a determinate time has the effect of rendering the obligation Article 1196, NCC. Whenever in an obligation a period is designated,
effective from the moment: it is presumed to have been established for the benefit of both the
(1) the period indicated has elapsed; or creditor and the debtor, unless from the tenor of the same or other
(2) if it has become evident that the event cannot occur. circumstances it should appear that the period has been established
in favor of one or of the other.
4. Obligation with a Term
Article 1198, NCC. The debtor shall lose every right to make use of
Definition the period:
 A term or period consists of a space of time which, having an (1) When after the obligation has been contracted, he becomes
influence on obligations as a result of a juridical act, and either insolvent, unless he gives a guaranty or security for the debt;
suspends their demandability or produces their extinguishment. (2) When he does not furnish to the creditor the guaranties or
(Lirag Textile Mills v. CA) securities which he has promised;
 It may also refer to a future event, the happening of which is (3) When by his own acts he has impaired said guaranties or
certain. securities after their establishment, and when through a
o If the happening of the future event is uncertain, it is a fortuitous event they disappear, unless he immediately gives
condition; new ones equally satisfactory;
o if the happening of the future event is certain, it is a term. (4) When the debtor violates any undertaking, in consideration of
which the creditor agreed to the period;
Kinds of Terms (5) When the debtor attempts to abscond.
Article 1193, NCC. Obligations for whose fulfillment a day certain
has been fixed, shall be demandable only when that day comes. (a) Rule
 Whenever in an obligation a period is designated, it is presumed
Obligations with a resolutory period take effect at once, but terminate to have been established for the benefit of both the creditor
upon arrival of the day certain. and the debtor.
 It means both can use the period.
A day certain is understood to be that which must necessarily come,  As a consequence, the creditor cannot demand payment, and the
although it may not be known when. debtor cannot make an effective tender and consignation of
payment, before the period stipulated has arrived
If the uncertainty consists in whether the day will come or not, the
obligation is conditional, and it shall be regulated by the rules of the (b) Exceptions
preceding Section. (1) Contrary agreement.
(a) If the period is for the benefit of the creditor alone, he may
(a) Suspensive and Resolutory demand performance at any time, even before the arrival of
(1) Suspensive Term: One that must lapse before the performance of the day certain, but the debtor in such a case cannot compel
the obligation can be demanded. (1193[1]) him to accept payment before the period lapses.
(a) Before the arrival of the period, the obligation already exists (b) If the period is for the benefit of the debtor alone, he may
but is not yet demandable. make payment at any time, even before the expiration of the
(b) A suspensive condition affects the very existence of the period, but he may oppose a premature demand for payment.
obligation. If the condition is not fulfilled, the obligation does (2) Debtor loses the right to use period in the following instances:
not arise. (a) debtor becomes insolvent, unless he gives a security;
(c) But a suspensive term does not affect the existence of the (b) debtor does not furnish the promised security;
obligation but only its demandability. (c) by his acts, debtor impaired the security or it disappears
(2) Resolutory Term: The period after which the obligation is by reason of fortuitous event, unless he gives a new security;
terminated. The obligation is valid up to a certain date. (d) debtor violates any undertaking by reason of which the
(a) Upon the arrival of said date, the obligation is terminated. creditor agreed to the period;
(b) A resolutory condition, upon its happening, results in the (e) debtor attempts to abscond.
extinguishment of the obligation (1181), as though it had
not existed. Instances When Court Authorized to Fix Period
(c) A resolutory term, upon the arrival of the day certain, Article 1197, NCC. If the obligation does not fix a period, but from its
simply results in the termination of the obligation without nature and the circumstances it can be inferred that a period was
annulling the fact of its existence, intended, the courts may fix the duration thereof.
(b) Definite and Indefinite The courts shall also fix the duration of the period when it depends
(1) Definite Term: Refers to a known date or time. upon the will of the debtor.
(2) Indefinite Term:
(a) An event which will necessarily happen but the date of its In every case, the courts shall determine such period as may under
happening is unknown, such as the death of a person. the circumstances have been probably contemplated by the parties.
(b) If the uncertainty consists in whether the day will come or not, Once fixed by the courts, the period cannot be changed by them.
the obligation is conditional. (1193)
Article 1180, NCC. When the debtor binds himself to pay when his
(c) Legal, Voluntary, and Judicial means permit him to do so, the obligation shall be deemed to be one
(1) Legal Term: It is the period granted by law. with a period, subject to the provisions of article 1197.
(2) Voluntary Term: It is the period stipulated by the parties.
(3) Judicial Term: It is the period allowed by the courts. (1) when obligation is intended to be with a period but the period
has not been fixed; (1197)
(2) when duration of the period is left to the exclusive will of the (2) the debtor cannot choose prestations which are impossible,
debtor, such as when the debtor binds himself to pay when his unlawful, or which could not have been the object of the
means permit him to do so; and (1180) obligation. (1200[2])
(3) when the non-compliance by one of the parties in reciprocal (3) When debtor's right of choice is lost: When only one
obligations is with respect to time, the court may fix or grant a prestation is practicable. (1202)
period if there exists a just cause therefor. (1191[3])
Effectivity of Choice
 When the obligation is not one with a period, such as when the Article 1201, NCC. The choice shall produce no effect except from
obligation is payable on demand (which is actually a pure the time it has been communicated.
obligation), the court is not authorized to fix the period.
(People’s Bank & Trust Co. v. Odom) Article 1205[1], NCC. When the choice has been expressly given to
 In numbers 1 and 2, the fulfillment of the obligation itself cannot the creditor, the obligation shall cease to be alternative from the day
be demanded until after the court has fixed the period for when the selection has been communicated to the debtor.
compliance therewith, and such period has arrived. Any action to
compel performance brought before that would be premature. Until then the responsibility of the debtor shall be governed by the
(Conception v. People) following rules:
(1) If one of the things is lost through a fortuitous event, he shall
G. Kinds of Obligations: Alternative and Facultative Obligations perform the obligation by delivering that which the creditor should
choose from among the remainder, or that which remains if only one
1. Classification Based on Number of Prestations (Object) subsists;
Article 1206, NCC. When only one prestation has been agreed upon, (a) When choice becomes effective: from the time it has been
but the obligor may render another in substitution, the obligation is communicated to the other or when the other gains knowledge
called facultative. of such choice. (1201)
(b) Effect:
The loss or deterioration of the thing intended as a substitute, through (1) Once choice is effective, it becomes irrevocable. (Reyes v.
the negligence of the obligor, does not render him liable. But once Martinez)
the substitution has been made, the obligor is liable for the loss of the (2) Hence, the obligation ceases to be alternative and
substitute on account of his delay, negligence or fraud. becomes a simple one of performing that which has been
chosen. (1205[1])
(1) Simple Obligation: there is only one prestation agreed upon.
(2) Conjunctive Obligation: When there are several prestations Effect of Loss of Prestation/s
which are due and the debtor is required to perform ail prestations Article 1204, NCC. The creditor shall have a right to indemnity for
in order for the obligation to be extinguished. damages when, through the fault of the debtor, all the things which
(3) Alternative Obligation: When there are several prestations which are alternatively the object of the obligation have been lost, or the
are due but the debtor is required to perform only one prestation compliance of the obligation has become impossible.
in order for the obligation to be extinguished.
(4) Facultative Obligation: there is only one prestation agreed The indemnity shall be fixed taking as a basis the value of the last
upon, but the debtor may render another in substitution. (1206) thing which disappeared, or that of the service which last became
impossible.
2. Alternative Obligation
Damages other than the value of the last thing or service may also
Right of Choice be awarded.
Article 1200, NCC. The right of choice belongs to the debtor, unless
it has been expressly granted to the creditor. Article 1205, NCC. When the choice has been expressly given to the
creditor, the obligation shall cease to be alternative from the day
The debtor shall have no right to choose those prestations which are when the selection has been communicated to the debtor.
impossible, unlawful or which could not have been the object of the
obligation. Until then the responsibility of the debtor shall be governed by the
following rules:
Article 1199, NCC. A person alternatively bound by different (1) If one of the things is lost through a fortuitous event, he shall
prestations shall completely perform one of them. perform the obligation by delivering that which the creditor
should choose from among the remainder, or that which
The creditor cannot be compelled to receive part of one and part of remains if only one subsists;
the other undertaking. (2) If the loss of one of the things occurs through the fault of the
debtor, the creditor may claim any of those subsisting, or the
Article 1202, NCC. The debtor shall lose the right of choice when price of that which, through the fault of the former, has
among the prestations whereby he is alternatively bound, only one is disappeared, with a right to damages;
practicable. (3) If all the things are lost through the fault of the debtor, the choice
by the creditor shall fall upon the price of any one of them, also
(a) Rule: It belongs to the debtor, unless expressly granted to the with indemnity for damages.
creditor. (1200[1])
(b) Limitation upon debtor's right of choice: The same rules shall be applied to obligations to do or not to do in
(1) The creditor cannot be compelled to receive part of one case one, some or all of the prestations should become impossible.
and part of the other undertaking; and (1199[2])
Article 1203, NCC. If through the creditor’s acts the debtor cannot (i) each debtor is liable only for a proportionate part of the
make a choice according to the terms of the obligation, the latter may debt
rescind the contract with damages. (ii) each creditor is entitled to demand only a proportionate
part of the credit from each debtor. (PH Credit Corp. v.
(a) If all were lost CA)
(1) by reason of fortuitous event or by reason of the (b) Solidary obligation:
creditor’s fault, the obligation is extinguished (i) each of the debtors is liable for the entire obligation,
(2) by reason of the debtor’s fault but the right of choice is (ii) each creditor is entitled to demand the satisfaction of the
with him, he is bound to pay the value of the last prestation whole obligation from any or all of the debtors.
which he lost, (1204[2]) plus damages; (1204[3]) and
(3) by reason of the debtor’s fault but the right of choice is Presumption in Favor of Joint Obligation
with the creditor, the latter can demand for the payment of  In case of plurality of subjects, the law presumes the obligation
the price of any of the prestations, with indemnity for to be merely joint. (1207)
damages. (1205[3])  Ex: where an instrument containing the word "We promise to pay"
(b) If NOT all were lost: is signed by two or more persons, they are presumed to be merely
(1) by reason of fortuitous event, the choice may still be joint debtors.
exercised from those remaining; (1205[1])
(2) by reason of the debtor’s fault but the right of choice is When Obligation Becomes Solidary
with him, he can choose from the remaining prestation/s; Article 1207, NCC. The concurrence of two or more creditors or of
(3) by reason of the debtor’s fault but the right of choice is two or more debtors in one and the same obligation does not imply
with the creditor, the latter may claim any of those that each one of the former has a right to demand, or that each one
subsisting (without right to damages), or the price of that of the latter is bound to render, entire compliance with the prestation.
which has disappeared (with a right to damages); (1205[2]) There is a solidary liability only when the obligation expressly so
(4) by reason of the creditor’s fault but the right of choice is states, or when the law or the nature of the obligation requires
with him, he can choose from the remaining prestation/s solidarity.
(5) by reason of the creditor’s fault but the right of choice is
with the debtor, the latter may either rescind the contract (1) when the obligation expressly so states;
with damages because he cannot make a choice (2) when the law so provides; or
according to the terms of the obligation (1203), or he may (3) when the nature of the obligation so requires.
choose from the remaining without a right to damages.
[1] Solidarity by Stipulation/Agreement
3. Facultative  The obligation may expressly state that
o each one of the debtors can be compelled to pay the totality
Concept of the debt, or
 Only one prestation has been agreed upon to be due (called o each one of them is obligated to pay for the entire value of the
“original prestation”), but the debtor may instead perform in obligation; (Juan Ysmael & Co. v. Salinas) or
substitution another prestation which has already been o the word “solidary" may be used; or
agreed upon (called “substitute prestation”).  the parties may use words indicating an agreement for solidarity:
 The choice to substitute is always with the debtor. o jointly and severally (International Finance Corp. v. Imperial
 The loss of the substitute prestation does not produce any legal Textile Mills, Inc.)
effect. o Junto o separadamente (Parot v. Gemora)
o However, the loss of the original prestation by fortuitous o individually and collectively (Oriental Commercial v. Lafuente)
event will result in the extinguishment of the obligation. o jointly liable (Ronquillo v. CA)
Requirement of Notice [2] Solidarity by Provision of Law

 If the debtor will be performing the original prestation, there is Examples are the following:
no need to notify the creditor because it is what is due. (1) where an instrument containing the word “I promise to pay” is
 If the debtor chooses to perform the other prestation, there is a signed by two or more persons, they are deemed to be jointly and
need to notify the creditor because it is not what is due; severally liable thereon, where the language of the instrument is
o otherwise, the loss of such prestation by reason of a cause ambiguous; (Article 17[g] NIL)
not attributable to him shall not result in the extinguishment of (2) if two or more heirs take possession of the estate, they shall be
the obligation. solidarily liable for the loss or destruction of a thing devised or
 Once the debtor notifies the creditor that he will be performing the bequeathed, even though only one of them should have been
other prestation, the obligation becomes a simple one of performing negligent; (927)
the chosen prestation. The loss of the chosen prestation by (3) all partners are liable solidarily with the partnership
fortuitous event will result in the extinguishment of the (a) for everything chargeable to the partnership for loss or injury
obligation. caused to any person by any wrongful act or omission of
any partner in the ordinary course of the business of the
H. Kinds of Obligations: Joint and Solidary Obligations partnership (1824, in relation to 1822), and
(b) for money or property of a third person misapplied by a
1. Classification Based on Number of Subjects partner in the course of the partnership business; *1824, in
relation to 1823)
(1) Simple Obligation: there is only one debtor and only one creditor. (4) the principal is solidarily liable with the agent even when the
(2) Joint or Solidary Obligation: In case of plurality of subjects, the latter has exceeded his authority, if the former allowed the latter
obligation is either joint or solidary. to act as though he had full powers; (1911)
(a) Joint obligation:
(5) if two or more persons have appointed an agent for a common (c) Interruption of prescription:
transaction or undertaking, they shall be solidarily liable to the (1) The interruption of prescription by the judicial demand of
agent for all the consequences of the agency; (1915) one creditor upon a debtor does not benefit the other
(6) in commodatum. two or more bailees are solidarily liable for a creditors nor interrupt the prescription as to other debtors.
thing loaned in the same contract; (1945) (2) A partial payment or acknowledgment made by one of
(7) the responsibility of two or more officious managers shall be several joint debtors does not stop the running of the statute
solidary, unless the management was assumed to save the thing of limitations as to the others.
or business from imminent danger; and (2146[2]) (d) Vices of each obligation: The vices of each obligation arising from
(8) the responsibility of two or more payees is solidary in solutio a personal defect of a particular debtor or creditor, do not affect the
indebiti (2157) validity of the other credits or debts.
(e) Insolvency of a debtor: The insolvency of a debtor does not
 Note: those provisions of law providing for solidarity only provide increase the liability of his co-debtors, nor does it authorize a
for solidarity with respect to the liability of the debtors. Hence, creditor to demand anything from his co-creditors.
solidarity on the side of the creditors may only exist by (f) Defense of res judicata:
agreement of the parties. (1) In divisible joint obligations, the defense of res judicata is not
extended from one debtor to another, the reason being that
[3] Solidarity by Reason of Nature of Obligation no debtor has more of an obligation than his own, nor may
 It cannot refer to the indivisibility of the obligation because the each creditor claim more rights than what respectively
law says that “the indivisibility of an obligation does not pertains to him.
necessarily give rise to solidarity.”
 Some of the obligations, solidary by nature, are also provided by Correlation of Debts and Credits
law, such as Since each debt and credit is considered distinct and separate from the
o civil liability arising from crime (110 RPC), others, the problem of correlation of debts and credits shall be governed
o the obligations by the following rules:
 of two bailees (1945), (1) when the number of creditors and debtors are the same, and
 of two officious managers (2146), or the division of the joint credit among the joint creditors and
 of two tortfeasors. (2194) the division among the joint debtors are unequal, and the debts
 When several heirs of a deceased partner continued with the and credits, as thus divided, can be matched with each other, they
business and management of the partnership against the will of the shall be the debtor and creditor of each other; and
other partner, the obligation of said heirs to undertake an inventory, (2) where the number of creditors and debtors are unequal, or
render an accounting of partnership assets, and to wind up the when although there is an equal number of creditors and
partnership affairs is solidary by its nature. (Sunga-Chan v. CA) debtors, the credits to which each joint creditor is entitled and
the share of the joint debt for which each joint debtor is
2. Joint Obligation answerable are unequal and do not match, each creditor may ask
or each debtor may pay all in proportion to the respective credits
Division of Joint Debts or Credits and debts, in order that such credits or debts may be subject to
Article 1208, NCC. If from the law, or the nature or the wording of equal contingencies.
the obligations to which the preceding article refers the contrary does
not appear, the credit or debt shall be presumed to be divided into as 3. Solidary Obligation
many shares as there are creditors or debtors, the credits or debts
being considered distinct from one another, subject to the Rules of Kinds of Solidarity
Court governing the multiplicity of suits. (a) Active Solidarity – It is the solidarity existing among the
creditors of the same obligation, by virtue of which, each of them,
 The division of joint credits or debts may be established in the as regards his co-creditors, is a creditor only as to his share
obligation itself, as when the debtors specified their respective in the obligation and, in regard to the common debtor, he
liabilities or when the creditors specified the sums for which each represents all of them.
of them is entitled. (b) Passive Solidarity – It is the solidarity existing among the
debtors of the same obligation, by virtue of which they are bound
 BUT if the obligation itself is silent as to how the debt or credit
to the payment of the whole credit.
shall be divided among the joint debtors or joint creditors, then
(c) Mixed Solidarity – It is the solidarity existing on the part of both
such debt or credit shall be presumed to be divided into as
creditors and debtors.
many equal parts as there are creditors or debtors
[1] Solidarity Among Creditors

Each Share Distinct from Others
The most essential and characteristic effect of a joint obligation is that Article 1213, NCC. A solidary creditor cannot assign his rights
the share of each of the joint creditors or debtors in the credit or without the consent of the others.
debt is considered distinct from one another. (1208)
Article 1214, NCC. The debtor may pay any one of the solidary
As a consequence: creditors; but if any demand, judicial or extrajudicial, has been made
(a) Extinction: The extinction of the debt of one of the various by one of them, payment should be made to him.
debtors does not necessarily affect the debts of the others.
(Agoncillo and Mariño v. Javier) Article 1215, NCC. Novation, compensation, confusion or remission
(b) Delay: of the debt, made by any of the solidary creditors or with any of the
(1) The delay on the part of only one of the joint debtors does solidary debtors, shall extinguish the obligation, without prejudice to
not produce effects with respect to the others the provisions of article 1219.
(2) if the delay is produced through the acts of only one of the
joint creditors, the others cannot take advantage thereof,
The creditor who may have executed any of these acts, as well as he (b) Who may: Any one of the solidary debtors may extinguish the
who collects the debt, shall be liable to the others for the share in the entire obligation. However, if two or more solidary debtors offer to
obligation corresponding to them. pay, the creditor may choose which offer to accept. (1217)
(c) Right of solidary debtor who paid entire obligation: He may
(a) Mutual agency: In regard to their common debtor or debtors, each demand reimbursement from his co-debtors only the share which
one of the creditors can represent all of them. Hence, insofar corresponds to each, with interest for the payment already made.
as the common debtors are concerned, each one of the creditors (1217)
is a representative of the others. (1) When one of the solidary debtors cannot, because of his
(b) Effect of demand: insolvency, reimburse his share to the debtor paying the
(1) Because of mutual agency, the debtor may pay any one of obligation, such shall be borne by all his co-debtors, in
the solidary creditors; proportion to the debt of each. (1217)
(2) but if any demand has been made by one of the solidary (d) Solidarity not affected by varied terms and conditions:
creditors, payment must be made only to such creditor. Solidarity may exist although the creditors and debtors may not
(1214) be bound in the same manner and by the same periods and
(3) Payment to another is a case of payment made to a wrong conditions. (1211)
person which will not extinguish the debtor’s obligation, (e) Defenses available to solidary debtor:
(c) Extinguishment of obligation: (1) Those derived from the nature of the obligation (1222),
(1) Because of mutual agency, any one of the solidary such as when the obligation is void or unenforceable, in
creditors may extinguish the debtor's obligation even which case, the debtor invoking it is not liable for the entire
without the consent of the others. Insofar as the debtor is obligation;
concerned, the act is valid and will result in the extinguishment (2) Those defenses which are personal to the debtor sued,
of the debtor’s obligation. (1215) such as minority or insanity, in which case, the debtor invoking
(2) The creditor who executed such act shall be liable to the it is not liable for the entire obligation; or those defenses which
others for the share in the obligation corresponding to them. pertain only to his share, such as when his share is subject to
(d) Assignment of creditor’s rights: A solidary creditor cannot a suspensive condition which is not yet fulfilled, in which case,
assign his rights to a stranger without the consent of the others. the debtor invoking it may not be compelled to pay his share
(1213) but only the shares pertaining to the others; and
(1) Such unauthorized assignment is invalid. Hence, if the debtor (3) Those defenses which personally belong to the others, in
pays the assignee the payment is not valid. which case, the debtor invoking it may not be compelled to
pay the share pertaining to such other debtor or debtors.
[2] Solidarity Among Debtors
Article 1216, NCC. The creditor may proceed against any one of the [3] Effect of Remission in Mixed Solidarity
solidary debtors or some or all of them simultaneously. The demand Article 1220, NCC. The remission of the whole obligation, obtained
made against one of them shall not be an obstacle to those which by one of the solidary debtors, does not entitle him to reimbursement
may subsequently be directed against the others, so long as the debt from his co-debtors.
has not been fully collected. Remission – condonation
If the remission is effected by one of the solidary creditors in favor
Article 1217, NCC. Payment made by one of the solidary debtors of one of the solidary debtors and without the consent of the other
extinguishes the obligation. If two or more solidary debtors offer to creditors:
pay, the creditor may choose which offer to accept. (a) Remission of entire obligation: It shall extinguish the
obligation; but the creditor who effected the remission shall be
He who made the payment may claim from his co-debtors only the liable to the others for the share in the obligation corresponding to
share which corresponds to each, with the interest for the payment them. (1215)
already made. If the payment is made before the debt is due, no (1) But the remission of the whole obligation obtained by one
interest for the intervening period may be demanded. of the solidary debtors does not entitle him to
reimbursement from his co-debtors. (1220)
When one of the solidary debtors cannot, because of his insolvency, (b) Remission of entire share of solidary debtor: It releases such
reimburse his share to the debtor paying the obligation, such share debtor from the obligation, with respect to the payment of the
shall be borne by all his co-debtors, in proportion to the debt of each. balance.
(1) But in case of insolvency of another solidary debtor, his share
Article 1211, NCC. Solidarity may exist although the creditors and shall be borne by all his co-debtors, including the debtor
the debtors may not be bound in the same manner and by the same whose entire share had already been condoned. (1217)
periods and conditions. (c) Partial remission of share of solidary debtor: If the remission in
favor of a solidary debtor is partial, his character as solidary
Article 1222, NCC. A solidary debtor may, in actions filed by the debtor continues with respect to the creditors and his co-
creditor, avail himself of all defenses which are derived from the debtors. Hence, he can be made to pay the balance of the
nature of the obligation and of those which are personal to him, or obligation.
pertain to his own share. With respect to those which personally
belong to the others, he may avail himself thereof only as regards 4. Joint and Indivisible Obligation
that part of the debt for which the latter are responsible.
Concept
(a) Mutual guaranty: The creditor may proceed against any one of Article 1210, NCC. The indivisibility of an obligation does not
the solidary debtors or some or all of them simultaneously. (1216) necessarily give rise to solidarity. Nor does solidarity of itself imply
Each one of the solidary debtors is liable for the entire obligation. indivisibility.
 As to the object of the obligation (prestation), the same is When the obligation has for its object the execution of a certain
indivisible. As to the subjects, in case of plurality, the same is a number of days of work, the accomplishment of work by metrical
joint obligation. Hence, the obligation is a joint obligation and, at the units, or analogous things which by their nature are susceptible of
same time, indivisible. partial performance, it shall be divisible.
 This is because the indivisibility of the obligation does not
necessarily give rise to solidarity (1210). However, even though the object or service may be physically
 Hence, even if the obligation is indivisible, it is presumed to be divisible, an obligation is indivisible if so provided by law or intended
merely joint in case of plurality of subjects. by the parties.
Consequences of Joint and Indivisible Obligation In obligations not to do, divisibility or indivisibility shall be determined
Article 1209. If the division is impossible, the right of the creditors by the character of the prestation in each particular case.
may be prejudiced only by their collective acts, and the debt can be
enforced only by proceeding against all the debtors. If one of the Obligation To Give
latter should be insolvent, the others shall not be liable for his share.  Obligations to deliver a definite thing, such as an animal or
vehicle, are indivisible.
Article 1224, NCC. A joint indivisible obligation gives rise to  However, even though the object may be physically divisible,
indemnity for damages from the time anyone of the debtors does not an obligation is indivisible if so provided by law or intended by
comply with his undertaking. The debtors who may have been ready the parties.
to fulfill their promises shall not contribute to the indemnity beyond
the corresponding portion of the price of the thing or of the value of Obligation To Do
the service in which the obligation consists.  Generally indivisible.
o Even though the service may be physically divisible, an
 In case of plurality of debtors, each one of the debtors is liable obligation is indivisible if so provided by law or intended
only for his part (not the entire obligation), but he cannot by the parties.
separately perform his part because of the indivisibility of the  These obligations are divisible, however, when:
prestation. o (1) the obligation has for its object the execution of a certain
o The obligation can be enforced only by proceeding number of days of work;
against all the debtors (1209), although each is liable only o (2) the obligation has for its object the accomplishment of
for his respective share. Since they are merely joint debtors, work by metrical units; or
the others shall not be liable in case of insolvency of one of o (3) the obligation has for its object analogous things which by
them. their nature are susceptible of partial performance.
 In case of breach of the obligation because any one of the joint
debtors does not comply with his undertaking, the obligation may J. Kinds of Obligations: Obligations with a Penal Clause
be converted into payment of damages.
o But only the erring debtor is liable for the payment of 1. Concept of Penal Clause
punitive damages, while the others cannot be liable beyond
their corresponding portion of the price of the thing or of the Definition
value of the service in which the obligation consists (1224). A penal clause is an accessory obligation which the parties attach to
 In case of plurality of creditors, each of the creditors is entitled a principal obligation for the purpose of insuring the performance by
to collect only his part (not the entire obligation), but since the imposing on the debtor a special prestation (generally consisting in the
obligation is indivisible, he cannot demand performance of such payment of a sum of money) in case the obligation is not fulfilled or is
part. irregularly or inadequately fulfilled. (Pryce Corp. v. PAGCOR)
o collection of the entire credit will require the collective action
of all creditors, although each is entitled only to his own part. As Substitute for Damages and Interest
Article 1226, NCC. In obligations with a penal clause, the penalty
I. Kinds of Obligations: Divisible and Indivisible Obligations shall substitute the indemnity for damages and the payment of
interests in case of noncompliance, if there is no stipulation to the
1. Classification Based on Susceptibility to Partial contrary. Nevertheless, damages shall be paid if the obligor refuses
Performance to pay the penalty or is guilty of fraud in the fulfillment of the
obligation.
(1) Divisible Obligation: The obligation is susceptible of division and
partial performance. The penalty may be enforced only when it is demandable in
(2) Indivisible Obligation: not susceptible of partial performance. accordance with the provisions of this Code.
Test: The test of divisibility of an obligation is whether or not it is (a) GR: The penalty takes the place of the indemnity for damages
susceptible of partial performance. and the payment of interest.
 This susceptibility does not mean that it is possible or not to fulfill (b) EXC: Indemnity for damages, in addition to and apart from the
the obligations by parts, but rather, whether or not it is opposed to penalty stipulated, may be recovered in three cases:
the ends or purpose of the obligation. (1) when there is an express stipulation to that effect;
(2) when the obligor, having failed to comply with the principal
2. Rules in Determining Indivisibility obligation, also refuses to pay the penalty, in which case
Article 1225, NCC. For the purposes of the preceding articles, the creditor is entitled to interest in the amount of the penalty,
obligations to give definite things and those which are not susceptible in accordance with Article 2209 of the NCC; or
of partial performance shall be deemed to be indivisible. (3) when the obligor is guilty of fraud in the fulfillment of the
obligation.
Not Replacement for Principal Obligation However, when the debt is in part liquidated and in part unliquidated,
Article 1227, NCC. The debtor cannot exempt himself from the the creditor may demand and the debtor may effect the payment of
performance of the obligation by paying the penalty, save in the case the former without waiting for the liquidation of the latter.
where this right has been expressly reserved for him. Neither can the
creditor demand the fulfillment of the obligation and the satisfaction (a) GR: Creditor cannot be compelled to accept partial payment.
of the penalty at the same time, unless this right has been clearly (b) EXC
granted him. However, if after the creditor has decided to require the (1) there is express stipulation allowing partial payment; &
fulfillment of the obligation, the performance thereof should become (2) debt is partly liquidated and partly unliquidated, the debtor
impossible without his fault, the penalty may be enforced. can pay the part liquidated without waiting for the liquidation
of the part that is unliquidated.
(a) GR: Penalty is not a substitute for the performance of the
obligation. Hence, as a rule, the debtor cannot exempt himself When Obligation Extinguished
from the performance of the obligation by paying the penalty. Article 1233, NCC. A debt shall not be understood to have been paid
(b) EXC: when the foregoing right is expressly reserved for the debtor. unless the thing or service in which the obligation consists has been
completely delivered or rendered, as the case may be.
When Creditor Entitled to Both Principal and Penalty
(a) GR: Creditor cannot demand the fulfillment of the obligation Article 1234, NCC. If the obligation has been substantially performed
and the satisfaction of the penalty at the same time. in good faith, the obligor may recover as though there had been a
(b) EXC: Creditor may only be entitled to both rights if the same has strict and complete fulfillment, less damages suffered by the obligee.
been clearly granted to him.
Article 1235, NCC. When the obligee accepts the performance,
Proof of Actual Damages Not Needed knowing its incompleteness or irregularity, and without expressing
Article 1228, NCC. Proof of actual damages suffered by the creditor any protest or objection, the obligation is deemed fully complied with.
is not necessary in order that the penalty may be demanded.
(a) GR: Only when obligation is completely delivered or rendered.
 Creditor need not present proof of actual damages suffered by (1233)
him in order that the penalty may be demanded. (1228) (b) EXC:
 There is no difference between a penalty and liquidated (1) when obligation is substantially performed in good faith;
damages. A stipulation on liquidated damages is a penalty (1234) and
clause where the obligor assumes a greater liability in case of (2) when creditor waives the balance of the obligation. (1235)
breach of an obligation. (Titan Construction Corp. v. Uni-field
Enterprises) [1] First Exception - Doctrine of Substantial Performance
Two requisites:
When Penalty May Be Reduced by Court (1) performance must be substantial, meaning the omission or
Article 1229, NCC. The judge shall equitably reduce the penalty deviation is slight, technical, or unimportant; (International Hotel
when the principal obligation has been partly or irregularly complied Corp v. Joaquin)
with by the debtor. Even if there has been no performance, the (2) the performance was in good faith, meaning the incomplete
penalty may also be reduced by the courts if it is iniquitous or performance is the result merely of an oversight,
unconscionable. misunderstanding, or excusable neglect
(1) when the principal obligation has been partly or irregularly [2] Second Exception - Waiver of the Balance
complied with by the debtor; or  While the creditor may not be compelled to accept partial payment,
(2) even if there has been no performance, if the penalty is iniquitous he may opt to accept the same. However, the acceptance of
or unconscionable. incomplete payment does not result in the extinguishment of
the obligation unless the creditor waives his right to recover
K. Extinguishment of Obligations: Payment the balance. (1235)
 Such intention to waive may not be inferred from the creditor’s mere
1. Importance of Compliance with Rules for Valid Payment silence in accepting an incomplete payment.
 If Strictly Complied: Debtor may compel the creditor to accept 3. Rule No. 2: Payment is made by the proper person;
payment. If the creditor refuses to accept, the refusal is without just otherwise, the creditor cannot be compelled to accept the
cause. Hence, the debtor may resort to valid consignation. same.
 If Not Strictly Complied: Creditor has just cause for refusing
to accept payment. If the debtor resorts to consignation, the same Who are Considered Proper Persons?
is not valid. (1) the debtor or his authorized representative;
(2) a third person allowed to make payment by agreement of the
2. Rule No 1: Payment must be complete. This element is parties; or
known as “integrity of payment.” (3) a third person interested in the fulfillment of the obligation,
such as guarantors, sureties, or third-party mortgagors.
Rule on Partial Payment:
Article 1248, NCC. Unless there is an express stipulation to that Rule If Payment is from a Stranger
effect, the creditor cannot be compelled partially to receive the He cannot compel the creditor to accept payment from him. But if the
prestations in which the obligation consists. Neither may the debtor creditor accepts the payment, the same is valid and the debtor’s
be required to make partial payments. obligation is extinguished.
Distinction Between Payment from a Third Person (Interested in the (3) persons authorized to receive the payment (1240), whether
Obligation) and from a Stranger authorized by the creditor or any person authorized by law to do so,
Article 1236, NCC. The creditor is not bound to accept payment or such as a guardian, executor, or administrator of the estate of a
performance by a third person who has no interest in the fulfillment deceased and assignee or liquidator of a partnership or
of the obligation, unless there is a stipulation to the contrary. corporation. (Haw Pia v. China Banking Corp.)
Whoever pays for another may demand from the debtor what he has Effect of Payment to Wrong Person
paid, except that if he paid without the knowledge or against the will Article 1241, NCC. Payment to a person who is incapacitated to
of the debtor, he can recover only insofar as the payment has been administer his property shall be valid if he has kept the thing
beneficial to the debtor. delivered, or insofar as the payment has been beneficial to him.
Article 1302, NCC. It is presumed that there is legal subrogation: Payment made to a third person shall also be valid insofar as it has
(1) When a creditor pays another creditor who is preferred, even redounded to the benefit of the creditor. Such benefit to the creditor
without the debtor’s knowledge; need not be proved in the following cases:
(2) When a third person, not interested in the obligation, pays with (1) If after the payment, the third person acquires the creditor’s
the express or tacit approval of the debtor; rights;
(3) When, even without the knowledge of the debtor, a person (2) If the creditor ratifies the payment to the third person;
interested in the fulfillment of the obligation pays, without (3) If by the creditor’s conduct, the debtor has been led to believe
prejudice to the effects of confusion as to the latter’s share. that the third person had authority to receive the payment.
Third Person Stranger Article 1242, NCC. Payment made in good faith to any person in
creditor can be compelled creditor cannot be compelled possession of the credit shall release the debtor.
to accept
he is entitled to full If the debtor consented to the (a) GR: Payment is invalid,
reimbursement even if payment, he is also entitled to full (b) EXC: payment to a wrong person is exceptionally valid if:
such payment was made reimbursement; if he pays without (1) payment has redounded to the benefit of the creditor
without the debtor’s the debtor’s consent, he is entitled to (1241[2])—it is the debtor, generally, who has the obligation to
consent reimbursement only up to the extent prove that the wrong payment redounded to the creditor’s benefit;
that the debtor was benefitted but in the ff. cases, the law already presumes that the wrong
he is entitled to be the debtor consented to the payment, payment has already redounded to the creditor’s benefit:
subrogated to the he is also entitled to be subrogated (a) if, after payment, the third person acquires the creditor’s
creditor’s rights even if to the creditor’s rights; but if he pays rights;
such payment was made without the debtor’s consent, he is (b) if the creditor ratifies the payment to the third person; or
without the debtor’s not entitled to be subrogated to the (c) if, by the creditor’s conduct, the debtor has been led to
consent; creditor’s rights. (1302) believe that the third person had authority to receive the
payment;
4. Rule No. 3: The payor must have the capacity to make (2) if the payment is made in good faith to any person in
payment. possession of the credit (1242) —in the absence of assignment
of the creditor or a valid negotiation (in case of negotiable
Effect If Payor is Incapacitated instruments), the payee does not become a possessor of the credit,
Where the person paying has no capacity to make the payment, the except when he is a holder of a negotiable instrument payable
creditor cannot be compelled to accept it; consignation will not be to bearer, in which case, any payment to the latter in good faith by
proper; in case he accepts it, the payment will not be valid. the debtor is a valid payment; and
(3) if the debtor pays the creditor prior to acquiring knowledge of
Capacity to Make Payment in Obligations to Give the assignment of credit made by the latter. (1626)
Article 1239, NCC. In obligations to give, payment made by one who
does not have the free disposal of the thing due and capacity to 6. Rule No. 5: The person to whom payment is made must have
alienate it shall not be valid, without prejudice to the provisions of the capacity to receive it.
article 1427 under the Title on “Natural Obligations.”
Effect of Payment Made to Incapacitated Person
In obligations to give, payment to be valid must be made by a person  GR: Payment is invalid,
having the free disposal of the thing due and capacity to alienate it.  EXC: Payment is valid:
o if the incapacitated has kept the thing delivered; or
5. Rule No. 4: Payment must be made to the proper person. o insofar as the payment has been beneficial to him. (1241[1])
Who are considered proper persons to whom payment must be 7. Rule No. 6: The very thing or service due must be
made? delivered—an element of payment known as “identity of
Article 1240, NCC. Payment shall be made to the person in whose payment.”
favor the obligation has been constituted, or his successor in interest,
or any person authorized to receive it. Nature of Obligation
(a) Determinate Obligation
(1) a person in whose favor the obligation has been constituted The debtor cannot compel the creditor to receive a different one,
(or the original creditor); although the latter may be of the same value as, or more valuable, than
(2) his successor-in-interest; or that which is due. (1244[1])
(b) Generic Obligation

Article 1246, NCC. When the obligation consists in the delivery of an

indeterminate or generic thing, whose quality and circumstances (d) Effect of extraordinary inflation or deflation
have not been stated, the creditor cannot demand a thing of superior Article 1250, NCC. In case an extraordinary inflation or deflation of
quality. Neither can the debtor deliver a thing of inferior quality. The the currency stipulated should supervene, the value of the currency
purpose of the obligation and other circumstances shall be taken into at the time of the establishment of the obligation shall be the basis of
consideration. payment, unless there is an agreement to the contrary.
If the quality and circumstances have not been stated, the creditor (1) Rule: In case an extraordinary inflation or deflation of the currency
cannot demand a thing of superior quality and the debtor may not stipulated should supervene, the value of the currency at the
deliver a thing of inferior quality. (1246) time of the establishment of the obligation shall be the basis of
payment, unless there is an agreement to the contrary. (1250)
(c) Obligation To Do or Not to Do (2) Requisites: For extraordinary inflation (or deflation) to affect an
An act or forbearance cannot be substituted by another act or obligation, the following requisites must be proven:
forbearance against the creditor’s will. (1244[2]) (a) there was an official declaration of extraordinary inflation
or deflation from the BSP (Equitable PCI Bank v. Ng Sheung
Obligation To Pay in Money Ngor); absent an official pronouncement or declaration by
Article 1249, NCC. The payment of debts in money shall be made in competent authorities of the existence of extraordinary
the currency stipulated, and if it is not possible to deliver such inflation during a given period, the effects of extraordinary
currency, then in the currency which is legal tender in the Philippines. inflation are not to be applied; (Telengtan Brothers & Sons,
Inc. v. US Lines, Inc)
The delivery of promissory notes payable to order, or bills of (b) the obligation was contractual in nature; (Equitable, supra)
exchange or other mercantile documents shall produce the effect of (c) that the parties expressly agreed to consider the effects of
payment only when they have been cashed, or when through the fault the extraordinary inflation or deflation.
of the creditor they have been impaired.
8. Rule No. 7: Payment must be in the proper place; otherwise,
In the meantime, the action derived from the original obligation shall the creditor cannot be compelled to accept the payment.
be held in abeyance.
Article 1251, NCC. Payment shall be made in the place designated
(a) GR: The creditor cannot be compelled to accept payment not in the in the obligation.
currency stipulated; or in the absence of agreement, in the currency
which is legal tender in the Philippines. (1249) There being no express stipulation and if the undertaking is to deliver
(b) Legal tender currency in the PH: All notes and coins issued by a determinate thing, the payment shall be made wherever the thing
the BSP and guaranteed by the Republic of the PH are considered might be at the moment the obligation was constituted.
legal tender for all debts, both public and private. (Sec. 52, RA
7653/ New Central Bank Act) With respect to coins, they shall be In any other case the place of payment shall be the domicile of the
considered legal tender: debtor.
(1) up to P1K only—for denominations of 1-Piso, 5-Piso, and 10-
Piso coins; and If the debtor changes his domicile in bad faith or after he has incurred
(2) up to P100 only—for denominations of 1-sentimo, 5-sentimo, in delay, the additional expenses shall be borne by him.
10-sentimo, and 25-sentimo coins. (BSP Circular No. 537,
Series of 2006) These provisions are without prejudice to venue under the Rules of
(c) Checks are not legal tender Court.
(1) RULE:
(a) A check is not legal tender, and an offer of a check in payment  GR: Payment must be made at the domicile of the debtor. (1251)
of a debt is not a valid tender of payment and may be refused o This rule applies even if the debtor changes his domicile in
receipt by the creditor, (PAL v. CA) whether it be a manager’s, bad faith, except that the additional expenses in collecting the
cashier’s, or personal check. (Tibajia Jr. v. CA) credit shall be borne by the debtor.
(2) When creditor accents: The rule does not prevent a creditor  EXC
from accepting a check as payment. However, the delivery of o if there is another place of payment designated in the
checks (or promissory note payable to order or other mercantile obligation; or
documents) shall produce the effect of payment only when: o in the absence of agreement and when the obligation is to
(a) they have been encashed; or deliver a determinate thing, the payment shall be made
(b) they have been impaired through the fault of the creditor. wherever the thing might be at the moment the obligation
(3) When tender of payment in check is for exercise of right was constituted.
 The requirement of legal tender is applicable only in the payment
of an obligation to pay in money. 9. Special Forms of Payment
 When the case involves not the payment of an obligation but the
exercise of a right, i.e., the right of redemption, the CC provisions [1] Dation in Payment
on payment of obligations do not apply. Instead, what applies is Concept: It is the alienation of property to the creditor in satisfaction
the settled rule that a mere tender of a check is sufficient to of a debt in money. (Fort Bonifacio Dev. Corp. v. Yllas Lending Corp.)
compel redemption. (Biana v. Gimenez)
 A check may be used for the exercise of the right of Requisites
redemption, the same being a right and not an obligation. The (1) there must be the performance of a prestation in lieu of
tender of a check is sufficient to compel redemption but is not in payment (animo solvendi) which may consist in the delivery of a
itself a payment that relieves the redemptioner from his liability to corporeal thing or a real right or a credit against the third person;
pay the redemption price. (Fortunado v. CA)
(2) there must be some difference between the prestation due and necessarily judicial, and the may be extrajudicial
that which is given in substitution (aliud pro adio), and priority of the first is the
(3) there must be an agreement between the creditor and debtor attempt to make a private
that the obligation is immediately extinguished by reason of the settlement before proceeding
performance of a prestation different from that due. to the solemnities of
(Lo v. KSJ Eco-Formwork System Phil., Inc.) consignation
(Meat Packing Corp. v. SB)
Effect
 The dation in payment extinguishes the obligation to the extent When Consignation Without Tender of Payment Sufficient
of the value of the thing delivered, either as agreed upon by the Article 1256, NCC. If the creditor to whom tender of payment has
parties or as may be proved, unless the parties by agreement, been made refuses without just cause to accept it, the debtor shall
express or implied, or by their silence, consider the thing as be released from responsibility by the consignation of the thing or
equivalent to the obligation, in which case the obligation is totally sum due.
extinguished. (Lopez v. CA)
 THUS: A dation in payment does not necessarily mean total Consignation alone shall produce the same effect in the following
extinguishment of the obligation. The obligation is totally cases:
extinguished only when the parties, by agreement, express or (1) When the creditor is absent or unknown, or does not appear at
implied, or by their silence, consider the thing as equivalent to the the place of payment;
obligation. (2) When he is incapacitated to receive the payment at the time it
is due;
[2] Cession (3) When, without just cause, he refuses to give a receipt;
Article 1255, NCC. The debtor may cede or assign his property to (4) When two or more persons claim the same right to collect;
his creditors in payment of his debts. This cession, unless there is (5) When the title of the obligation has been lost.
stipulation to the contrary, shall only release the debtor from
responsibility for the net proceeds of the thing assigned. The Consignation generally requires a prior tender of payment. (1256)
agreements which, on the effect of the cession, are made between
the debtor and his creditors shall be governed by special laws. But in the following instances, consignation alone shall result in the
release of the debtor from his responsibility:
Concept: Cession or assignment consists in the abandonment of the (1) when creditor is absent;
totality of the property of the debtor in favor of the creditors in order (2) when creditor is unknown;
that the same may be applied for the satisfaction of their credits. (3) when creditor does not appear at the place of payment;
(4) when creditor is incapacitated to receive the payment at the time
Distinguished from Dation in Payment it is due;
Dation Cession (5) when, without just cause, creditor refuses to give a receipt;
transfers the ownership only the possession and administration (6) when two or more persons claim the same right to collect; and
over the thing alienated are transferred to the creditors (7) when the title of the obligation has been lost.
to the creditor
does not require plurality requires plurality of creditors Requisites for Valid Consignation
of creditors (1) there was a debt due; hence, in instances where no debt is due
debtor must not be presupposes the existence of insolvency and owing, consignation is not proper (Legaspi v. CA), such as in
insolvent on the part of the debtor cases of right of redemption since the right to redeem is a right, not
involves specific thing or involves the totality of the property of the an obligation; (Immaculata v. Navarro)
property debtor (2) the creditor to whom tender of payment was made refused to
may totally extinguish the assignment only releases the debtor accept it, or because he or she was absent or incapacitated, or
the obligation and result from responsibility for the net proceeds because several persons claimed to be entitled to receive the
in the release of the of the thing assigned, unless there is amount due or because the title to the obligation had been lost;
debtor stipulation to the contrary (1255) (3) previous notice of the consignation had been given to the
person interested in the performance of the obligation (not only the
[3] Tender of Payment and Consignation creditor must be notified but all persons interested in the fulfillment
of the obligation, such as guarantors, sureties and third-party
 Rule: Tender of payment, even if valid, does not by itself
mortgagors);
produce legal payment, unless it is completed by consignation
(4) the amount due was placed at the disposal of the court; and
(PNB v. Relativo)
(5) after the consignation had been made, the person interested was
 The effect of a valid tender of payment is to exempt the debtor
notified of the action (not only the creditor must be notified but all
from payment of interest (compensatory) and/or damages
persons interested in the fulfillment of the obligation, such as
guarantors, sureties and third-party mortgagors).
Distinctions Between Tender of Payment and Consignation
(a) This requisite is fulfilled by the service of summons upon the
Consignation Tender
defendants together with a copy of the complaint.
is the act of depositing the is the antecedent of consignation,
(b) The essential requisites must be complied with fully and
thing due with the court or that is, an act preparatory to the
strictly in accordance with Articles 1256 to 1261 NCC.
judicial authorities whenever consignation, which is the
(c) Substantial compliance is not enough. (Soco v. Militante)
the creditor cannot accept or principal, and from which are
refuses to accept payment, derived the immediate
When Debt Considered Extinguished
and it generally requires a consequences which the debtor
 Consignation is completed:
prior tender of payment desires or seeks to obtain
o at the time the creditor accepts the same without objections,
or
o if he objects, at the time the court declares that it has been (5) the expenses of consignation shall be charged against the
validly made in accordance with law. (Reisenbeck v. CA) creditor. (1259)
 The consignation has retroactive effect. The payment is deemed
to have been made at the time of the deposit of the money in court, Effects If Consignation is Invalid
or when it was placed at the disposal of the judicial authority. (1) the obligation remains and there is no suspension of the accrual
(Ramos v. Sarao) of the interest; and
(2) it is the consignor who shall bear the loss; (Chua Kay v. Lim
Withdrawal By Debtor of Deposit Chang) and
Article 1260, NCC. Once the consignation has been duly made, the (3) the expenses of consignation shall be for the account of the
debtor may ask the judge to order the cancellation of the obligation. debtor. (1259)
Before the creditor has accepted the consignation, or before a judicial [4] Application of Payment
declaration that the consignation has been properly made, the debtor Requisites
may withdraw the thing or the sum deposited, allowing the obligation (1) there exist only one debtor and one creditor;
to remain in force. (2) between them, there be several obligations;
(3) the various debts be of the same kind;
Article 1261, NCC. If, the consignation having been made, the (4) the debts are all due, except when:
creditor should authorize the debtor to withdraw the same, he shall (a) the parties so stipulate; or
lose every preference which he may have over the thing. The co- (b) the application is made by the party for whose benefit the term
debtors, guarantors and sureties shall be released. has been constituted; (1252[1]) and
(5) the payment made is not sufficient to cover all obligations.
 Before the creditor has accepted the consignation or before a
judicial declaration that the consignation has been properly Right to Make Application Initially Belongs to Debtor
made, the debtor may withdraw the thing or the sum deposited Article 1252, NCC. He who has various debts of the same kind in
as a matter of right, allowing the obligation to remain in force. favor of one and the same creditor, may declare at the time of making
(1260[2]) the payment, to which of them the same must be applied. Unless the
 After the creditor has accepted the consignation or after a parties so stipulate, or when the application of payment is made by
judicial declaration that the consignation has been properly the party for whose benefit the term has been constituted, application
made, the debtor may no longer withdraw the same without the shall not be made as to debts which are not yet due.
consent of the creditor.
o In such a situation, if the creditor authorizes the debtor to If the debtor accepts from the creditor a receipt in which an
withdraw the thing or sum deposited, he loses every application of the payment is made, the former cannot complain of
preference which he may have over the thing and the co- the same, unless there is a cause for invalidating the contract.
debtors, guarantors, and sureties shall be released. (1261)
Article 1253, NCC. If the debt produces interest, payment of the
Effects If Consignation is Valid principal shall not be deemed to have been made until the interests
Article 1256, NCC. If the creditor to whom tender of payment has have been covered.
been made refuses without just cause to accept it, the debtor shall
be released from responsibility by the consignation of the thing or  To the debtor corresponds in the first instance the right to
sum due. determine to which debt his payment should be applied. (1252)
 But such right must be exercised by the debtor at the time of
Consignation alone shall produce the same effect in the following payment, and not afterwards. (Powell v. National Bank)
cases:  Once the right is exercised, such application is irrevocable and the
(1) When the creditor is absent or unknown, or does not appear at debtor has no more right to change his application of payment.
the place of payment; (Bachrach Garage and Taxicab Co. v. Golingco)
(2) When he is incapacitated to receive the payment at the time it
is due; However, the debtor cannot make an application of payment in the
(3) When, without just cause, he refuses to give a receipt; following manner:
(4) When two or more persons claim the same right to collect; (1) that will violate the agreement; (Premiere Dev. Bank v. Central
(5) When the title of the obligation has been lost. Surety & Insurance Co., Inc.)
(2) he cannot make a partial payment of any of the debts, in violation
Article 1259, NCC. The expenses of consignation, when properly of the rule in Article 1248; or
made, shall be charged against the creditor. (3) if the debt produces interest, he cannot apply his payment to
the principal without paying first the interest, in violation of the
(1) it produces the effect of payment, thereby releasing the debtor rule in Article 1253.
from all responsibility; (1256)
(2) the accrual of interest on the obligation is suspended from the If Debtor Did Not Exercise Right
moment of consignation;  Where the debtor has not expressly elected any particular
(3) the loss of the thing or amount consigned occurring without the obligation to which the payment should be applied at the time of
fault of the debtor before the acceptance of the consignation by the making the payment, the creditor may make such application.
creditor or its approval by the court should be for the account of (1252)
the creditor; (Sia v. CA)  However, in order for the application made by the creditor to be
(4) since the consignation has retroactive effect, the fruits, products, valid and lawful, the following requisites must be present:
and interest of the thing consigned shall belong to the creditor (a) the creditor expresses such application in the
from the moment the consignation was made; and corresponding receipt that he issued; and
(b) the debtor must have assented to such application, as (1) it perishes,
shown by his acceptance of the receipt without protest. (2) goes out of commerce, or
(i) Ultimately, therefore, the application by a creditor (3) disappears in such a way that its existence is unknown or it cannot
depends upon the debtor’s acquiescence. (Traders be recovered.
Insurance & Surety Co. v. Dy Eng Giok)
Requisites for Loss of Specific Thing Due
Application By Operation of Law Article 1262, NCC. An obligation which consists in the delivery of a
Article 1254, NCC. When the payment cannot be applied in determinate thing shall be extinguished if it should be lost or
accordance with the preceding rules, or if application can not be destroyed without the fault of the debtor, and before he has incurred
inferred from other circumstances, the debt which is most onerous to in delay.
the debtor, among those due, shall be deemed to have been
satisfied. When by law or stipulation, the obligor is liable even for f ortuitous
events, the loss of the thing does not extinguish the obligation, and
If the debts due are of the same nature and burden, the payment he shall be responsible for damages. The same rule applies when
shall be applied to all of them proportionately. the nature of the obligation requires the assumption of risk.
When neither the debtor nor the creditor has specified to which of the Article 1165[3], NCC. If the obligor delays, or has promised to deliver
several debts the payment should be applied or if application cannot be the same thing to two or more persons who do not have the same
inferred from other circumstances, the following rules should be applied: interest, he shall be responsible for any fortuitous event until he has
(1) the payment should be applied first to the debt which is most effected the delivery. (1096)
onerous to the debtor; or
(2) if the debts due are of the same nature and burden, the payment (1) the loss occurs without the fault of the debtor;
should be applied to all of them proportionately. (2) the loss occurs prior to the debtor incurring delay; and
(3) there is no law or stipulation holding the debtor liable even in
Debts More Onerous to Debtor case of fortuitous event, or that the nature of the obligation does
(1) Guaranteed debts are deemed to be more onerous to the debtor not require the assumption of risk.
than those not guaranteed, and are entitled to priority in the
application of the debtor’s payments; (Traders) Hence, the debtor must not have obligated himself to deliver the
(2) where one debt bears interest and the other does not, even if the same thing to two or more persons who do not have the same
latter should be the older obligation, the former is considered as interest; otherwise, he shall be responsible for the loss of the thing by
more onerous; (Menzi & Co. v. Quing Chuan) reason of fortuitous event until he has effected the delivery. (1165[3])
(3) where there are various debts, the oldest ones are more
burdensome, and payments should be applied to them before the Presumption that Loss is Due to Debtor’s Fault
more recent ones; (PNB v. Veraguth) and Article 1265, NCC. Whenever the thing is lost in the possession of
(4) when a person has two debts, one as sole debtor and another as the debtor, it shall be presumed that the loss was due to his fault,
solidary co-debtor, his more onerous obligation to which first unless there is proof to the contrary, and without prejudice to the
payments are to be applied is the debt as sole debtor. provisions of article 1165. This presumption does not apply in case
(Commonwealth v. Far East Surety & Insurance Co.) of earthquake, flood, storm or other natural calamity.
L. Extinguishment of Obligations: Loss  GR: It is presumed that the loss was due to the fault of the debtor
whenever the thing is lost in his possession.
1. As Applied to Obligations to Give  EXC: the presumption does not apply in case of earthquake,
flood, storm, or other natural calamity. (1265)
As Applied to Obligations To Give
Article 1263, NCC. In an obligation to deliver a generic thing, the When Law Provides for Liability Even for Fortuitous Event
loss or destruction of anything of the same kind does not extinguish (1) The obligor delays or has promised to deliver the same thing to
the obligation. two or more persons who do not have the same interest; (1165,
last para.)
 Only an obligation to deliver a determinate thing (determinate (2) the possessor in bad faith in every case; (552[2])
obligation) can be extinguished by reason of loss. (3) if the common carrier negligently incurs in delay in transporting
 An obligation to deliver a generic thing (generic obligation cannot the goods, a natural disaster shall not free such carrier from
be extinguished by reason of loss because the genus of a thing responsibility; (1740)
can never perish (genus nunquamperil). (4) the borrower who uses the thing for a purpose different from
o EX: an obligation to pay money is generic (Ramirez v. CA) that intended, delays its return, receives the thing under
appraisal, lends it to a third person, or saves his property
Concept of Loss in Determinate Obligations instead of the thing borrowed; (1942)
Article 1189[2], NCC. When the conditions have been imposed with (5) the depositary who uses the thing without the depositor’s
the intention of suspending the efficacy of an obligation to give, the permission, delays its return, or allows others to use it; (1979)
following rules shall be observed in case of the improvement, loss or (6) the negotiorum gestor or officious manager who undertakes
deterioration of the thing during the pendency of the condition: risky transactions, prefers his interest to that of the owner, fails to
(2) If the thing is lost through the fault of the debtor, he shall be return the property after demand by the owner, or assumes
obliged to pay damages; it is understood that the thing is lost when it management in bad faith; (2147) and
perishes, or goes out of commerce, or disappears in such a way that (7) when the obligation to deliver a determinate thing proceeds from a
its existence is unknown or it cannot be recovered; criminal offense, unless prior to its loss the person who should
receive it refused acceptance without justification. (1268)
The thing is lost when:
2. As Applied to Obligations to Do One and the other kinds shall be subject to the rules which govern
inofficious donations. Express condonation shall, furthermore,
An obligation to do is lost comply with the forms of donation.
Article 1266, NCC. The debtor in obligations to do shall also be
released when the prestation becomes legally or physically  It is gratuitous on the part of the creditor, but it requires
impossible without the fault of the obligor. acceptance by the debtor to be valid. (1270)
o Either in the form of donation inter vivos or legacy,
Article 1267, NCC. When the service has become so difficult as to depending on its effectivity. Whether donation or legacy, it
be manifestly beyond the contemplation of the parties, the obligor must not be inofficious.
may also be released therefrom, in whole or in part.
Donation Inter Vivos: When the creditor intended the condonation to
(1) when the prestation becomes legally or physically impossible become effective during his lifetime.
without the fault of the debtor; (1266) or
(2) when, by reason of an unforeseen event, the service has become Legacy of Condonation of Debt: When the creditor intended the
so difficult as to be manifestly beyond the contemplation of condonation to become effective upon his death.
the parties (1267)
2. When Condonation is Donation
Article 1266 Applicable Only to Obligation to Do
 Article 1266 is applicable only to obligations “to do,” which include How Made: Either expressly or impliedly. (1270[1]) Acceptance by the
all kinds of work or service. debtor must be made during the lifetime of the creditor; otherwise,
 The obligation to pay rentals or deliver the thing in a contract the donation is not perfected.
of lease falls within the prestation “to give”; hence, it is not covered
within the scope of Article 1266. (PNCC v. CA) If Made Expressly: It must conform with the formalities of ordinary
 In Article 1266, the performance of the obligation to do must be donation in Articles 748 and 749; otherwise, it is void.
possible at the time of the perfection of the contract; otherwise,
the contract is void because it contemplates of rendition of an Presumption of Condonation:
impossible service. (1409[5]) The performance becomes Article 1271, NCC. The delivery of a private document evidencing a
impossible only during the consummation stage. credit, made voluntarily by the creditor to the debtor, implies the
renunciation of the action which the former had against the latter.
Doctrine of Unforeseen Events
(a) Requisites for Application of Article 1267 If in order to nullify this waiver it should be claimed to be inofficious,
(1) the event or change in circumstances could not have been the debtor and his heirs may uphold it by proving that the delivery of
foreseen at the time of the execution of the contract; the document was made in virtue of payment of the debt.
(2) it makes the performance of the contract extremely difficult but
not impossible;  When a private document evidencing a credit is found in the
(3) it must not be due to the act of any of the parties; and possession of the creditor, it gives rise to a presumption that
(4) the contract is for a future prestation. (Tagaytay Realty, Inc. v. the creditor voluntarily delivered the document to the debtor
Gacutan) and such voluntary delivery gives rise to a presumption of the
condonation of the indebtedness. (1271[1])
 The difficulty of performance under Article 1267 CC should be such  The presumption can be rebutted by proving that there was no
that one party would be placed at a disadvantage by the voluntary delivery.
unforeseen event.
 Mere inconvenience, unexpected impediments, or increased 3. When Condonation is Legacy
expenses do not suffice to relieve the debtor from a bad bargain.
As to Form: It must comply with the formalities of a last will and
(b) Applicability testament.
 The doctrine of unforeseen events should apply only to
o risks that are manifestly beyond the contemplation of the Timing of Acceptance: The acceptance by the debtor can only be
parties, or made after the death of the creditor.
o to absolutely exceptional changes of circumstances,
where equity demands assistance for the debtor. (PNCC) N. Extinguishment of Obligations: Merger or Confusion
 NOT TO risks that are already known, or should have been
known, to the parties when they entered into their contractual 1. Concept
relations.
Article 1275, NCC. The obligation is extinguished from the time the
M. Extinguishment of Obligations: Condonation or Remission characters of creditor and debtor are merged in the same person.
1. Concept Article 1276, NCC. Merger which takes place in the person of the
principal debtor or creditor benefits the guarantors. Confusion which
Article 1270, NCC. Condonation or remission is essentially takes place in the person of any of the latter does not extinguish the
gratuitous, and requires the acceptance by the obligor. It may be obligation.
made expressly or impliedly.
Definition: Confusion or merger is the meeting in one person of the
qualities of creditor and debtor with respect to the same obligation. It
exists when the characters of creditor and debtor are merged in the
same person. (1275)
(a) hence, taxes cannot be subject to compensation for the

Requisites simple reason that the government and the taxpayer are not
(1) it must take place in the person of the principal creditor and creditors and debtors of each other, (Philex Mining v. CIR)
principal debtor (1276); hence, if the merger involves the creditor (b) for debts are due to the Government in its corporate
and the guarantor, the obligation is not extinguished; and capacity, while taxes are due to the Government in its
(2) it must be complete and definite, because if it is not complete, the sovereign capacity
obligation still subsists. (c) that there can be no valid compensation between the debt of
corporation X to the stockholders of corporation Y under a
O. Extinguishment of Obligations: Compensation contract of loan and the obligation of corporation Y to
corporation X for the payment of the purchase price in a
1. Concept contract of sale, for the reason that both corporations are
not mutually bound as creditors and debtors in their own
Definition: It is a mode of extinguishing to the concurrent amounts the name because a corporation has a personality distinct and
obligations of persons who, in their own right and as principals, are separate from its stockholders (CHK Industrial v. CA);
reciprocally creditors and debtors of each other. (PNB Madecor v. Uy) (d) but a bank has the right to set off a deposit in its hands to
extinguish the indebtedness owed to it by the same
Kinds depositor, (Gullas v. PNB) because, as to fixed, savings, and
Article 1278, NCC. Compensation shall take place when two current deposits of money in banks and similar institutions, the
persons, in their own right, are creditors and debtors of each other. relationship between banks and depositors has been held to
be that of creditor and debtor; (Associated Bank v. Tan)
(1) Legal – takes place ipso jure when all the requisites of law are (2) both debts consist in a sum of money, or if the things due are
present; (Mavest, Inc. v. Sampaguita Garment Corp.) consumable, they be of the same kind, and also of the same
(2) Voluntary – occurs when the parties agree to the mutual quality if the latter has been stated; (1279[2])
extinguishment of their credits or to compensate their mutual (3) both debts be due (1279[3]) —if one of the debts is payable on
obligations even in the absence of some of the legal requisites; demand and there is no demand yet, there can be no legal
(3) Judicial – takes place when the court allows the set off or compensation because such debt is not yet due; (PNB Madecor)
counterclaim of the defendant as against the claim of the plaintiff (4) both debts be demandable and liquidated (1279[4]) —
(4) Facultative – when it can be claimed by the party who can (a) hence, if one of the debts is a natural obligation, there can
oppose it and who is the only party prejudiced by the be no legal compensation because a natural obligation is not
compensation, as happens when one of the obligations has a legally demandable; and
period for the benefit of one party alone and the latter renounces (b) a debt is liquidated when its existence and amount are
the period with the effect of making the obligation due and therefore determined (PH Trust Co. v. Roxas), or when the amount is
compensable. determinable by inspection of the terms and conditions of
relevant documents (Soriano v. People); and
 In legal, voluntary, and judicial compensation, there must be (5) neither of the debts be subject to any lien, retention, or suit
the confluence of the characters of the mutual debtors and instituted by third persons of which notice has been
creditors. communicated in due time to the debtor. (1279[5])
o Without this, the contracting parties cannot stipulate, in case (a) By “in due time” should be meant the period before legal
of voluntary compensation, as to the compensation of their compensation was supposed to take place, considering
obligations, for then the legal tie that binds contracting parties that legal compensation operates so long as the requisites
to their obligations would be absent. concur, even without any conscious intent on the part of the
o At least one party would be binding himself under an authority parties.
he does not possess. (CKH Industrial and Dev. Corp. v. CA) (b) A controversy that is communicated to the parties after
that time may no longer undo the compensation that had
2. Legal Compensation taken place by force of law, lest the law concerning legal
compensation be for naught. (PNB Madecor v. Uy)
Requisites
Article 1278, NCC. Compensation shall take place when two Effects of Legal Compensation
persons, in their own right, are creditors and debtors of each other. Article 1290, NCC. When all the requisites mentioned in article 1279
are present, compensation takes effect by operation of law, and
Article 1279, NCC. In order that compensation may be proper, it is extinguishes both debts to the concurrent amount, even though the
necessary: creditors and debtors are not aware of the compensation.
(1) That each one of the obligors be bound principally, and that he
be at the same time a principal creditor of the other;  When all the requisites are present, compensation takes effect
(2) That both debts consist in a sum of money, or if the things due by operation of law, and extinguishes both debts to the
are consumable, they be of the same kind, and also of the same concurrent amount, even though the creditors and debtors are not
quality if the latter has been stated; aware of the compensation. (1290)
(3) That the two debts be due;  Legal compensation operates even against the will of the
(4) That they be liquidated and demandable; interested parties and even without their consent.
(5) That over neither of them there be any retention or controversy,  Since this compensation takes place ipso jure, its effects arise on
commenced by third persons and communicated in due time to the day on which all its requisites concur. When used as a defense,
the debtor. it retroacts to the date when its requisites are fulfilled. (BPI v. CA)
(1) The parties must be creditors and debtors of each other in their Debts Not Subject to Legal Compensation
own right and as principals (1278) —
Article 1287, NCC. Compensation shall not be proper when one of  The previous obligation need not be civil; it may be
the debts arises from a depositum or from the obligations of a a natural obligation. Hence, a prescribed debt is a
depositary or of a bailee in commodatum. natural obligation which is a sufficient consideration
for the new contract. (Villaroel v. Estrada)
Neither can compensation be set up against a creditor who has a (2) There must be an agreement of the parties concerned to a new
claim for support due by gratuitous title, without prejudice to the contract - when there is neither a valid new contract nor a clear
provisions of paragraph 2 of article 301. agreement between the parties to a new contract, there is no
novation. Without the new contract, the old contract is not
Article 1288, NCC. Neither shall there be compensation if one of the extinguished. (Country Bankers Insurance v. Lagman)
debts consists in civil liability arising from a penal offense. (3) There must be the extinguishment of the old contract – the
extinguishment of the old obligation by the new one is a necessary
(1) when one of the debts arises from a depositum; element of extinctive novation which may be effected either
(2) when one of the debts arises from the obligations of a depositary expressly or impliedly. (PNB v. Soriano)
or of a bailee in commodatum; (4) There must be the validity of the new contract (Wellex Group,
(3) when one of the debts arises from a claim for support due by Inc. v. U-Land Airlines Co., Ltd)
gratuitous title (1287); o if the new obligation is void, the extinguishment of the original
(4) when one of the debts consists in civil liability arising from a obligation is not realized (1297), because that which is null
penal offense (1288); and and void cannot produce any effect.
(5) when one of the debts consists in the claim of Government for o BUT even when there is no novation because of the nullity of
payment of taxes. the new obligation, Article 1297 provides that the original
obligation is deemed extinguished if “the parties intended
P. Extinguishment of Obligations: Novation that the former relation should be extinguished in any event."
1. Concept Kinds of Novation

(a) As to Essence
Definition: Novation is the extinguishment of an obligation by the (1) Objective Novation - also called real novation, occurs when
substitution or change of the obligation by a subsequent one which there is a change of the object, cause, or principal
extinguishes or modifies the first, either by changing the object or conditions of an existing obligation;
principal conditions, or by substituting another in place of the debtor, (2) Subjective Novation - also called personal novation, occurs
or by subrogating a third person in the rights of the creditor. (Ajax when there is a change of either the person of the debtor,
Marketing Dev. Corp. v. CA) or of the creditor in an existing obligation;
(3) Mixed Novation - when the change of the object, cause, or
Extinctive or Modificatory principal conditions of an obligation occurs at the same time
In its broadest concept, novation is either extinctive or modificatory. with the change of either in the person of the debtor or
 Extinctive (total novation): an old obligation is terminated by creditor.
the creation of a new one that takes the place of the former. (Ajax)
 Modificatory (partial novation): old obligation subsists to the (b) As to Form or Constitution
extent that it remains compatible with the amendatory agreement. (1) Express - when the new obligation declares in unequivocal
(Sime Darby Pilipinas, Inc. v. Goodyear PH) terms that the old obligation is extinguished;
o Only a modification or change in some principal conditions of (2) Implied - when the new obligation is incompatible with the
the obligation. old one on every point. (Wellex)
o It is total, when the obligation is completely extinguished. (Ong
v. Bogñalbal) [1] Objective Novation
Article 1291, NCC. Obligations may be modified by:
2. Extinctive Novation (1) Changing their object or principal conditions;
(2) Substituting the person of the debtor;
Requisites (3) Subrogating a third person in the rights of the creditor.
Article 1297, NCC. If the new obligation is void, the original one shall
subsist, unless the parties intended that the former relation should be  A novation is objective if the change involves the cause, object, or
extinguished in any event. any principal conditions. (1291[1])
 Hence, the novation is merely modificatory where the change
Article 1298, NCC. The novation is void if the original obligation was brought about by any subsequent agreement is merely incidental
void, except when annulment may be claimed only by the debtor, or to the main obligation, such as a change in the interest rate, an
when ratification validates acts which are voidable. extension of time to pay (Foundation Specialist, Inc. v. Betonval
Ready Concrete, Inc.) or a change in the period to comply with the
(1) There must be a previous valid obligation obligation.
o it is only when the original obligation is void that the o Such a change in the period would only be a modificatory (or
novation also becomes void. partial) novation, since the period merely affects the
o There will be a valid novation even if the original obligation performance, not the creation of the obligation. (Ong)
is voidable in two instances:  An obligation to pay a sum of money is not novated by an
 when there has been a ratification of the obligation prior instrument that expressly recognizes the old, or changes only
to the novation inasmuch as ratification cleanses the the terms of payment, or adds other obligations not
obligation of its defects from the very beginning; or incompatible with the old ones, or the new contract merely
 if the defect can be claimed only by the debtor supplements the old one. (PNB v. Soriano) The novation is
because when he consents to the novation, he merely modificatory.
renounces his right to annul the old obligation. (1298)
[2] Subjective Novation (2) When a third person, not interested in the obligation, pays with
[a] Substitution of Debtor the express or tacit approval of the debtor;
(a) Release of debtor (3) When, even without the knowledge of the debtor, a person
 In order to change the person of the debtor, the old one must be interested in the fulfillment of the obligation pays, without
expressly released from the obligation, and the third person or prejudice to the effects of confusion as to the latter’s share.
new debtor must assume the former’s place in the relation.
(PH Savings Bank v. Mañalac) (1) when a creditor pays another creditor who is preferred,
 Without the express release of the debtor from the obligation, even without the debtor’s knowledge;
any third party who may thereafter assume the obligation shall (2) when a third person, not interested in the obligation, pays
be considered merely as co-debtor or surety. If there is no with the express or tacit approval of the debtor; or
agreement as to solidarity, the first and the new debtor are (3) when, even without the knowledge of the debtor, a person
considered obligated jointly. (Aquintey v. Tibong) interested in the fulfillment of the obligation pays, without
prejudice to the effects of confusion as to the latter’s share.
(b) Expromision or Delegacion
Article 1295, NCC. The insolvency of the new debtor, who has been (c) Conventional Subrogation
proposed by the original debtor and accepted by the creditor, shall Article 1301, NCC. Conventional subrogation of a third person
not revive the action of the latter against the original obligor, except requires the consent of the original parties and of the third person.
when said insolvency was already existing and of public knowledge,
or known to the debtor, when he delegated his debt.  Conventional subrogation of a third person requires the consent
of the original parties (the original creditor and debtor) and of the
(1) Expromision third person (the new creditor). (1301)
 When the initiative for the change does not emanate from the  It is a new contractual relation based on the mutual agreement
old debtor and it may even be made without his knowledge or among all the necessary parties. (Licaros)
consent, since it consists in a third person assuming his
obligation. (d) Distinctions Between Conventional Subrogation and
 As such, expromision absolutely requires the consent of the third Assignment of Credit
person (or new debtor) and the creditor. Conventional Subrogation Assignment of Credit
o BUT the consent of the old debtor is not indispensable debtor’s consent is necessary the consent of the debtor is
because it can be made even without his knowledge or not necessary in order that
consent. the assignment may fully
produce the legal effect
(2) Delegation subrogation extinguishes an assignment refers to the
 When the debtor offers and the creditor accepts a third person obligation and gives rise to a new same right which passes
who consents to the substitution so that the intervention and the one from one person to another
consent of these 3 persons are necessary the nullity of an old obligation the nullity of an obligation is
 they are respectively known as may be cured by subrogation, not remedied by the
o delegante (original debtor), such that the new obligation will be assignment of the creditor’s
o delegatario (creditor), and perfectly valid right to another
o delegado (new debtor). (Testate Estate of Mota v. Serra) If the intention of the parties is that If the creditor’s right is
the agreement would not transferred to a third person
GR: Whether the substitution of debtor is by expromision or delegation, become valid and effective in the without requiring the debtor’s
the effect is the same: release of the original debtor from the absence of the debtor’s consent, consent for its validity, the
obligation. the transaction is one of transaction is merely an
EXC: In delegacion, if the new debtor fails to perform the obligation conventional subrogation and assignment of the credit.
by reason of his insolvency, the action can be revived against the not an assignment of credit. (Rodriguez v. CA)
original debtor in two instances:  Hence, if not consented to by
(1) when the insolvency of the new debtor was already existing the debtor, there is no
and of public knowledge at the time the old debtor delegated his conventional subrogation and
debt; or it may not be treated as an
(2) when such insolvency was already existing and known to the assignment of credit.
old debtor at the time he delegated his debt. (1295)
[b] Subrogation
(a) Definition and Kinds
The transfer of all the rights of the creditor to a third person, who
substitutes him in all his rights. (Licaros v. Gatmaitan)
(1) Legal Subrogation - takes place without agreement but by
operation of law because of certain acts; and
(2) Conventional Subrogation - takes place by agreement of parties.
(b) Instances of Legal Subrogation

Article 1302, NCC. It is presumed that there is legal subrogation:
(1) When a creditor pays another creditor who is preferred, even
without the debtor’s knowledge;
PART II: CONTRACTS (1) Onerous —the cause is understood to be, for each
contracting party, the prestation or promise of a thing or
Q. Basic Concepts service by the other (1350), like sale;
(2) Remuneratory - cause is the service or benefit for which the
1. Concept remuneration is given; and
(3) Gratuitous - cause is the mere liberality of the benefactor, like
Article 1305, NCC. A contract is a meeting of minds between two commodatum,
persons whereby one binds himself, with respect to the other, to give (e) According to Risk Involved
something or to render some service. (1) Commutative - each of the contracting parties gives and
receives an equivalent or there is a mutual exchange of
Article X, NCC. X relative values, like sale; and
(2) Aleatory - each of the parties or both reciprocally bind
Definition: themselves to give or to do something in consideration of what
 A contract is a meeting of minds between two persons whereby one the other shall give or do upon the happening of an event
binds himself, with respect to the other, to give something or to which is uncertain, or which is to occur at an indeterminate
render some service. time (2010), like the contract of insurance.
 "a juridical convention manifested in legal form, by virtue of which
one or more persons bind themselves in favor of another or others, 2. Fundamental Characteristics
or reciprocally, to the fulfillment of a prestation to give, to do, or not
to do. (Jardine Davies, Inc. v. CA) (1) Obligatory Force of Contracts
Article 1159, NCC. Obligations arising from contracts have the force
Important Classifications of law between the contracting parties and should be complied with
Article 1307, NCC. Innominate contracts shall be regulated by the in good faith.
stipulations of the parties, by the provisions of Titles I and II of this
Book, by the rules governing the most analogous nominate contracts,  “Obligations arising from contracts have the force of law between
and by the customs of the place. the contracting parties and should be complied with in good faith.
(1159)”
Article 1350, NCC. In onerous contracts the cause is understood to  To be obligatory, the contract must be perfected, valid, and
be, for each contracting party, the prestation or promise of a thing or enforceable.
service by the other; in remuneratory ones, the service or benefit
which is remunerated; and in contracts of pure beneficence, the mere (2) Autonomy of Contracts
liberality of the benefactor. Article 1306, NCC. The contracting parties may establish such
stipulations, clauses, terms and conditions as they may deem
Article 2010, NCC. By an aleatory contract, one of the parties or both convenient, provided they are not contrary to law, morals, good
reciprocally bind themselves to give or to do something in customs, public order, or public policy.
consideration of what the other shall give or do upon the happening
of an event which is uncertain, or which is to occur at an  Also known as freedom of contracts.
indeterminate time.  The contracting parties are accorded the liberality and freedom
to establish such stipulations, clauses, terms, and conditions
(a) As to Perfection as they may deem convenient, provided the same are not contrary
(1) Consensual - that which is perfected by mere consent; and to law, morals, good customs, public order, or public policy (1306).
(2) Real - that which is perfected not by mere consent but by the  Such freedom is protected by the Constitution:
delivery of the object of the contract, o (1) no person shall be deprived of life, liberty, or property
(b) As to Its Name: without due process of law (Art. III, Sec. 1); and
(1) Nominate - that which is distinguished by a particular or o (2) no law shall be passed impairing obligation of contracts
special name in the CC, like sale, lease, and deposit; and (Art. III, Sec. 10)
(2) Innominate - recognized in CC, but not specially named or
classified. These shall be regulated by the stipulation of (3) Mutuality of Contracts
the parties, the provisions of Obligations and Contracts, Article 1308, NCC. The contract must bind both contracting parties;
by the rules governing the most analogous nominate its validity or compliance cannot be left to the will of one of them.
contracts, and by the customs of the place.
(i) do ut des—I give that you give;  The “contract must bind both the contracting parties; its validity
(ii) do ut facias—I give that you do; or compliance cannot be left to the will of one of them. (1308)
(iii) acio ut des—I do that you give; and  The ultimate purpose is to render void a contract containing a
(iv) facio ut facias—I do that you do. condition which makes its fulfillment dependent solely upon
(c) As to Degree of Dependence the uncontrolled will of one of the contracting parties (Allied
(1) Principal - can exist independently of other contracts, like a Banking Corp. v. CA)
contract of loan; o Ex. even if the loan agreement gave the creditor a license to
(2) Accessory - cannot exist without a valid principal contract, increase the interest rate at will during the term of the loan,
like guaranty, pledge, mortgage, and antichresis; and that license would have been null and void for being violative
(3) Preparatory - not an end by itself but only a means for the of the principle of mutuality essential in contracts (PNB v. CA
execution of another contract, like agency and the contract of [1991]) because the rate of interest is a vital component of the
option, agreement (PNB v. CA [1994])
(d) As to Cause o However, contracts of adhesion—one in which one of the
parties imposes a ready-made form of contract, which the
other party may accept or reject, but which the latter cannot (ii) the stipulation must be a part, not the whole of the
modify (Geraldez v. CA) — have been declared as binding contract;
as ordinary contracts, the reason being that the party who (iii) the contracting parties must have clearly and deliberately
adheres to the contract is free to reject it entirely (PH conferred a favor upon a third person, not a mere
Commercial and International Bank v. CA) incidental benefit or interest;
(iv) the third person must have communicated his
(4) Relativity of Contracts acceptance to the obligor before its revocation; and
(a) Concept: The principle of relativity of contracts provides that (v) neither of the contracting parties bears the legal
contracts can only bind the parties who entered into it, and it cannot representation or authorization of the third party. (Young
favor or prejudice a third person, even if he is aware of such v. CA) Once the third person accepts the benefit, he will
contract and has acted with knowledge thereof. (Integrated acquire the right to proceed against the contracting
Packaging Corp. v. CA) parties even if he is not a party to the contract.
(2) Third persons may be affected by contracts creating real
(b) But including heirs and assigns rights when they come into possession of the object of the
Article 1311, NCC. Contracts take effect only between the parties, contract (1312),
their assigns and heirs, except in case where the rights and (i) A recorded lease is binding upon the purchaser who did
obligations arising from the contract are not transmissible by their not take any part in the execution of the lease contract
nature, or by stipulation or by provision of law. The heir is not liable (1676) or
beyond the value of the property he received from the decedent. (ii) a contract of mortgage duly registered is binding upon
third persons. (2125[1], 2126)
If a contract should contain some stipulation in favor of a third person, (3) Creditors acquire the right to rescind the contract entered into
he may demand its fulfillment provided he communicated his by the debtor with a third person if that contract is intended
acceptance to the obligor before its revocation. A mere incidental to defraud him. (1313; 1381[3])
benefit or interest of a person is not sufficient. The contracting parties (4) Tort interference – any third person who induces another to
must have clearly and deliberately conferred a favor upon a third violate his contract shall be liable for damages to the other
person. contracting party (1314), if the following are present:
(i) the existence of a valid contract;
A contract also binds the heirs and assigns of the contracting parties. (ii) knowledge on the part of the third person of the existence
The general rule is that heirs are bound by contracts entered into by their of contract; and
predecessors-in-interest, except when the rights and obligations arising (iii) interference of the third person is without legal
therefrom are not transmissible by justification or excuse. (So Ping Bun v. CA) A third
(1) their nature, person can be held liable for tort interference even if he
(2) stipulation, or does not know the identity of one of the contracting
(3) provision of law. (1311[1]) parties. The law does not require that the responsible
 As a rule, therefore, he who contracts does so for himself and his person shall have known the identity of the injured
heirs. (Eleizegui v. Lawn Tennis Club) person. (Gilchrist v. Cuddy)
o For example, a contract of lease is generally transmissible to
the heirs of the lessor or lessee. Consequently, the R. Perfection and Essential Requisites of Contracts
successors-in-interest of the lessee are entitled to the
benefits, while that of the lessor are burdened with the duties 1. Perfection of Contracts
and obligations, which said covenants conferred and imposed
on the original parties. (Estate of Llenado v. Llenado) Stages of Contracts
(1) Negotiation – or preparation begins when the prospective
(c) Exceptions to relativity of contracts contracting parties manifest their interest in the contract and
ends at the moment of their agreement;
Article 1312, NCC. In contracts creating real rights, third persons (2) Perfection – or birth of the contract occurs when they agree upon
who come into possession of the object of the contract are bound the essential elements thereof; and
thereby, subject to the provisions of the Mortgage Law and the Land (3) Consummation – which is the last stage, occurs when the parties
Registration Laws. fulfill or perform the terms agreed upon in the contract,
culminating in the extinguishment thereof.
Article 1313, NCC. Creditors are protected in cases of contracts (Sagun v. ANZ Global Services and Operations, Inc.)
intended to defraud them.
How Perfection of Contracts Takes Place
Article 1314, NCC. Any third person who induces another to violate  The perfection of a contract takes place upon the concurrence of
his contract shall be liable for damages to the other contracting party. the essential elements thereof. (Ang Yu Asuncion v. CA)
 A contract which is consensual as to perfection is so established
(1) Stipulation pour autrui - it is a stipulation in favor of a third upon a mere meeting of minds, i.e., the concurrence of offer and
person conferring a clear and deliberate favor upon him, acceptance, on the object, and on the cause thereof.
and which stipulation is merely a part of a contract entered o Stated otherwise, a consensual contract is perfected by mere
into by the parties, neither of whom acted as agent of the third consent. (XYST Corp. v. DMC)
person, and such third person may demand its fulfillment  A contract which requires, in addition to the above, the delivery of
provided that he communicates his acceptance to the the object of the agreement is referred to as a real contract.
obligor before it is revoked. (Florentino v. Encarnacion) o requires delivery of the object of the contract for its perfection:
o (1) pledge,
Requisites o (2) commodatum,
(i) there must be a stipulation in favor of a third person; o (3) mutuum, and
o (4) deposit. (1) as a rule, business advertisements of things for sale are not offers
o All other contracts are consensual, or perfected by mere but mere invitations to make an offer (1325) —the positive
consent. response to such advertisement is what may be considered as the
offer;
Kinds of Elements of Contracts (2) advertisements for bidders are not considered as offers but simply
(1) Essential – those necessary for the very existence of the invitations to make proposals —the bid proposals or quotations
contract itself and the absence of any one of said elements will submitted by the prospective suppliers are the offers and the reply
prevent the creation or existence of a contract, such as the object, of the proposer, the acceptance or rejection of the offers (Jardine);
cause, consent, and delivery of the object; and
(2) Natural - those which are not essential for the existence of a (3) display of goods with a price ticket attached in a shop window or
contract but they are presumed to exist in certain contracts, unless on a supermarket shelf is not an offer to sell but an invitation for
there is an express stipulation to the contrary (e.g., warranties customers to make an offer to buy.
against eviction and hidden defects in a contract of sale); and
(3) Accidental - those which exist only when the parties expressly When Offer is Terminated
provide for them, such as the clauses, terms, and conditions that Article 1321, NCC. The person making the offer may fix the time,
the parties may agree upon, provided they are not contrary to law, place, and manner of acceptance, all of which must be complied with.
morals, good customs, public order, or public policy. (1306)
Article 1323, NCC. An offer becomes ineffective upon the death, civil
Essential Requisites of Contracts interdiction, insanity, or insolvency of either party before acceptance
 Consensual contracts: (1) consent; (2) object; and (3) cause. is conveyed.
 Real contracts: (1) consent; (2) object; (3) cause; and (4) delivery
of the object. (1) by revocation or withdrawal
o the offer may be withdrawn or revoked by the offeror, as a
2. Consent rule, at any time prior to the perfection of the contract (Ang Yu)
o Where a period is given to the offeree within which to accept
(a) How Manifested the offer and the same has a separate consideration, a
Article 1319, NCC. Consent is manifested by the meeting of the offer contract of “option” is deemed perfected, and it would be a
and the acceptance upon the thing and the cause which are to breach of that contract to withdraw the offer during the agreed
constitute the contract. The offer must be certain and the acceptance period;
absolute. A qualified acceptance constitutes a counter-offer. (2) by rejection of the offer by the offeree or when he makes a
counter-offer—because a counter-offer is a rejection of the
Acceptance made by letter or telegram does not bind the offerer original offer and the simultaneous making of a new offer;
except from the time it came to his knowledge. The contract, in such (3) by the death, insanity, insolvency, or civil interdiction of either
a case, is presumed to have been entered into in the place where the the offeror or the offeree prior to perfection of the contract (1323);
offer was made. (4) by expiration of the period fixed for the acceptance of the offer
(1321);
 Consent is manifested by the meeting of the offer and (5) by the supervening illegality of the proposed contract prior to
acceptance upon the thing and the cause which are to constitute perfection; and
the contract. (6) by the destruction of the subject matter prior to perfection
 Thus, an offer that is not accepted does not give rise to
consent, and the contract does not come into existence. (Gamboa Option Contract
v. Gonzales) (1) Concept:
o An option is a preparatory contract in which one party grants
(b) Offer to the other, for a fixed period and under specified
Concept conditions, the power to decide, whether or not to enter
 It is defined as “an expression of willingness to contract on into a principal contract.
certain terms, made with the intention that it shall become binding o It binds the party who has given the option, not to enter into
as soon as it is accepted by the person to whom it is addressed.” the principal contract with any other person during the period
 Thus, an offer refers to a unilateral proposition which one party designated, and, within that period, to enter into such contract
makes to the other for the celebration of the contract. (Paredes with the one to whom the option was granted, if the latter
v. CA) should decide to use the option.
o It is a separate agreement distinct from the contract which
Requisites for effective offer: the parties may enter into upon the consummation of the
(1) the offeror must have a serious intention to become bound by his option. (Carceller v. CA)
offer; (2) If not supported by consideration
(2) the terms of the offer must be reasonably certain (1319), definite, o If the period is not founded upon or supported by a
and complete, so that the parties and the court can ascertain the consideration, the option does not become a contract.
terms of the offer; and o Thus, the offeror is still free and has the right to withdraw the
(3) the offer must be communicated by the offeror to the offeree, offer before its acceptance, or, if an acceptance has been
resulting in the offeree’s knowledge of the offer. made, before the offeror’s coming to know of such fact, by
communicating that withdrawal to the offeree. (Ang Yu)
Instances not considered as offers (3) When option becomes contract
Article 1325, NCC. Unless it appears otherwise, business o Where a period is given to the offeree within which to accept
advertisements of things for sale are not definite offers, but mere the offer and the same is founded upon or supported by a
invitations to make an offer. separate consideration, a contract of “option” is deemed
perfected.
o Since the option becomes a contract, the offeror is bound by

the agreement and may not withdraw the offer during the When acceptance binds offeror
period agreed upon. Thus, it will be a breach of that contract The contract is perfected only from the time an acceptance of an offer is
(of option) to withdraw the offer during the agreed period. made known to the offeror. (1319) This is known as the cognition
(4) Consideration in option contract theory being followed by the Civil Code,
o By the very nature of an option contract, the same is an
onerous contract for which the consideration must be Withdrawal of acceptance
something of value, although its kind may vary. (Villamor For a contract to arise, the acceptance must be made known to the
v. CA) offeror. Accordingly, the acceptance can be withdrawn or revoked before
o The consideration need not be monetary but could consist it is made known to the offeror. (Jardine)
of other things or undertakings.
(5) Option money distinguished from earnest money (d) Capacity to Give Consent
Persons incapable of giving consent
Earnest Money Option Money Article 1327, NCC. The following cannot give consent to a contract:
part of the purchase price money given as a distinct (1) Unemancipated minors;
consideration for an option (2) Insane or demented persons, and deaf-mutes who do not know
contract how to write.
given only where there is already applies to a sale not yet
a sale perfected Article 1328, NCC. Contracts entered into during a lucid interval are
when earnest money is given, when the would-be buyer gives valid. Contracts agreed to in a state of drunkenness or during a
the buyer is bound to pay the the option money, he is not hypnotic spell are voidable.
balance required to buy
(Adelfa Properties, Inc. v. CA) (1) Minors
 where the minors who entered into the contract have already
(c) Acceptance of Offer passed the age of puberty and adolescence in such a way that
Must be absolute they could misrepresent and actually did misrepresent
Article 1319, NCC. Consent is manifested by the meeting of the offer themselves as having reached the age of majority (active
and the acceptance upon the thing and the cause which are to misrepresentation), they cannot, upon reaching the age of
constitute the contract. The offer must be certain and the acceptance majority, annul the contract on the ground of minority inasmuch
absolute. A qualified acceptance constitutes a counter-offer. as they are already in estoppel (Mercado v. Espiritu);
 if the minor was guilty merely of constructive or passive
Acceptance made by letter or telegram does not bind the offerer misrepresentation, or when the document signed by him did not
except from the time it came to his knowledge. The contract, in such contain such statement that he is already of legal age, he may still
a case, is presumed to have been entered into in the place where the annul the contract upon reaching the age of majority (Braganza v.
offer was made. Villa-Abrille);
(2) insane or demented persons – but contracts entered into during a
 To be effective, an acceptance must be absolute. (1319[1]) lucid interval are valid; (1328)
 An acceptance is absolute and unqualified when it is identical in (3) deaf mutes who do not know how to write;
all respects with that of the offer so as to produce consent or a (4) those in a state of drunkenness or during a hypnotic spell;
meeting of the minds. (Talampas, Jr. v. Moldex) (5) persons suffering from the accessory penalty of civil interdiction;
 A qualified acceptance, or one that involves a new proposal, (34 RPC) and
constitutes a counter-offer and is a rejection of the original offer. (6) incompetents under guardianship.
Any modification or variation from the terms of the offer annuls the
offer. (ABS-CBN v. CA) Effects of old age and physical infirmity
 A person is not incapacitated to contract merely because of
Manner of Acceptance advanced years or by reason of physical infirmities.
Article 1320, NCC. An acceptance may be express or implied.  Only when such age or infirmities impair his mental faculties
to such extent as to prevent him from properly, intelligently, and
Article 1321, NCC. The person making the offer may fix the time, fairly protecting his property rights that he is considered
place, and manner of acceptance, all of which must be complied incapacitated. (Loyola v. CA)
with.
Effect of illiteracy
Article 1322, NCC. An offer made through an agent is accepted from Article 1332, NCC. When one of the parties is unable to read, or if
the time acceptance is communicated to him. the contract is in a language not understood by him, and mistake or
fraud is alleged, the person enforcing the contract must show that the
 The offeror may fix the time, place, and manner of acceptance, all terms thereof have been fully explained to the former.
of which must be complied with (1321).
 An acceptance which is not made in the manner prescribed by the  An illiterate is not incapable of giving consent to a contract.
o However, when an illiterate alleges mistake or fraud in
offeror is not effective but constitutes a counter-offer which the
offeror may accept or reject. giving his consent, the burden is on the party interested in
enforcing the contract to prove that the terms have been fully
 In the absence of any manner of acceptance fixed by the offeror
explained to the former in a language understood by him
in his offer, an acceptance may be express or implied (1320) and,
(1332);
 if an offer has been made through an agent, it is deemed
 otherwise, the contract is voidable.
accepted from the time the acceptance is communicated to said
agent. (1322)
o It is the party invoking the benefits of Article 1332 who has the exception, mistake of law may invalidate consent if the following
burden of proving that he really is unable to read or that the requisites are present:
contract is written in a language not understood by him. (a) the mistake must be with respect to the legal effect of an
o Only after sufficient proof of such facts may the burden of agreement;
proving that the terms of the contract had been explained to (b) it must be mutual; and
the disadvantaged person be shifted to the party enforcing the (c) the real purpose of the parties must have been frustrated.
contract. (Sales v. CA) (1334)
(e) Vices of Consent [2] Violence

[1] Mistake Article 1335, NCC. There is violence when in order to wrest consent,
Article 1331, NCC. In order that mistake may invalidate consent, it serious or irresistible force is employed.
should refer to the substance of the thing which is the object of the
contract, or to those conditions which have principally moved one or There is intimidation when one of the contracting parties is compelled
both parties to enter into the contract. 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
Mistake as to the identity or qualifications of one of the parties will his spouse, descendants or ascendants, to give his consent.
vitiate consent only when such identity or qualifications have been
the principal cause of the contract. To determine the degree of intimidation, the age, sex and condition
of the person shall be borne in mind.
A simple mistake of account shall give rise to its correction.
A threat to enforce one’s claim through competent authority, if the
Article 1333, NCC. There is no mistake if the party alleging it knew claim is just or legal, does not vitiate consent.
the doubt, contingency or risk affecting the object of the contract.
Article 1336, NCC. Violence or intimidation shall annul the
Article 1334, NCC. Mutual error as to the legal effect of an obligation, although it may have been employed by a third person
agreement when the real purpose of the parties is frustrated, may who did not take part in the contract.
vitiate consent.
In order that violence may vitiate consent and be a ground for annulment
Requisites of a contract, the following requisites must be present:
(1) Mistake should refer to the substance of the thing which is the (1) the force employed is either serious or irresistible; and
object of the contract (1331) – which includes (2) it must have been the determining cause of consent. It is not
o mistake over the essence or the substantial qualities of a necessary that the force be always irresistible. (1335)
thing (error in substantia) which affects not the identity of the (a) Such violence will annul the obligation, although it may have
thing but the materials which compose it been employed by a third person who did not take part in the
 Ex: the purchase of an object which is gold plated in the contract. (1336)
belief that it is really gold;
o mistake over determinate attributes or characteristics of [3] Intimidation
a thing foreign to its matter, but which has been understood In order that intimidation may vitiate consent and render the contract
as essential by the contracting parties (error in substantia), invalid, the following requisites must concur:
 Ex: a painting by Goya is bought and the painting is not (1) that the intimidation must be the determining cause of the contract,
of Goya; and or must have caused the consent to be given;
o mistake as to amount (error in quantitate) which refers to (2) that the threatened act be unjust or unlawful;
 mistake as to the extension or dimension of the object (3) that the threat be real and serious, there being an evident
and differs from the mistake of account which is simply a disproportion between the evil and the resistance which all men can
mistake in the computation or in a mathematical offer, leading to the choice of the contract as the lesser evil; and
operation; or (4) that it produces a reasonable and well-grounded fear from the fact
o to those conditions which have principally moved one or both that the person from whom it comes has the necessary means or
parties to enter into the contract, or ability to inflict the threatened injury. (De Leon v. CA)
o to the identity or qualifications of one of the parties when (a) The intimidation will annul the obligation, although it may have
the same have been the principal cause of the contract — been employed by a third person who did not take part in the
 for mistake as to the qualification of one of the parties to contract. (1336)
vitiate consent, the mistake must be either with regard to (b) However, a threat to enforce one’s claim through competent
the identity or with regard to the qualification of one of authority, if the claim is just or legal, does not vitiate consent.
the contracting parties and the identity or qualification (1335[4])
must have been the principal consideration for the
celebration of the contract (Roman Catholic Church v. [4] Undue Influence
Pante); In order for undue influence to vitiate consent, the following requisites
(2) it must be excusable and not one that could have been avoided by must be present:
the party alleging it (1333) — (1) a person who can be influenced;
o an error so patent and obvious that nobody could have (2) the fact that improper influence was exerted; and
made it, or one which could have been avoided by ordinary (3) submission to the overwhelming effect of such unlawful conduct.
prudence, or a mistake that is caused by manifest (Loyola v. CA)
negligence, cannot be invoked by the one who made it in
order to annul his contract (Domingo Realty v. CA); and [5] Fraud
(3) it must generally be a mistake of fact and not mistake of law. Article 1338, NCC. There is fraud when, through insidious words or
Ordinarily, a mistake of law does not vitiate consent. By way of 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. All services which are not contrary to law, morals, good customs,
public order or public policy may likewise be the object of a contract.
Article 1339, NCC. Failure to disclose facts, when there is a duty to
reveal them, as when the parties are bound by confidential relations, (1) all things which are not outside the commerce of men, including
constitutes fraud. future things;
(2) all rights which are not intransmissible; or
Article 1342, NCC. Misrepresentation by a third person does not (3) all services which are not contrary to law, morals, good customs,
vitiate consent, unless such misrepresentation has created public order, or public policy.
substantial mistake and the same is mutual.
Requisites
Article 1344, NCC. In order that fraud may make a contract voidable, Article 1348, NCC. Impossible things or services cannot be the
it should be serious and should not have been employed by both object of contracts.
contracting parties.
Article 1349, NCC. The object of every contract must be determinate
Incidental fraud only obliges the person employing it to pay damages. as to its kind. The fact that the quantity is not determinate shall not
be an obstacle to the existence of the contract, provided it is possible
In order that fraud may vitiate consent and be a cause for annulment of to determine the same, without the need of a new contract between
contract, the following must concur: the parties.
(1) it must have been employed by one contracting party upon the
other - as a rule, therefore, misrepresentation by a third person (1) it must be within the commerce of men;
does not vitiate consent (Hill v. Veloso); exceptions: (2) it must be real or possible, either physically or legally;
(a) when the third person causes the fraud in connivance with, or (3) it should be licit, or not contrary to law, morals, good customs,
at least with the knowledge, without protest, of the favored public order, or public policy; and
contracting party, the contract may be annulled, and (4) it should be determinate or determinable, as to its kind.
(b) a contract may also be annulled on the ground of vitiated
consent if deceit by a third person, even without connivance Rule as to Future Inheritance
or complicity with one of the contracting parties, resulted in GR:
mutual error on the part of the parties to the contract (Rural  no contract may be entered into upon future inheritance (1347[2]).
Bank of Caloocan, Inc. v. CA);  Contracts entered into upon future inheritance are void (Arrogante
(2) it must have induced the other party to enter into the contract — v. Deliarte).
o it must be causal fraud (dolo causante), meaning the fraud  For inheritance to be considered “future,” succession must not have
must be the determining cause of the contract, or must have been opened at the time of the contract. (JLT Agro, Inc. v.
caused the consent to be given (Fontana Resort v. Tan), Balansag)
o if the fraud is merely incidental (dolo incidente), or those
which are not serious in character and without which the other A contract may be classified as a contract upon future inheritance
party would still have entered into the contract, the person prohibited under Article 1347[2] CC where the following requisites
employing fraud is only liable to pay damages; concur:
(3) it must have been serious (1) the succession has not yet been opened;
o the fraud is serious when it is sufficient to impress, or to (2) the object of the contract forms part of the inheritance; and
lead an ordinarily prudent person into error; (3) the promisor has, with respect to the object, an expectancy of a
o that which cannot deceive a prudent person cannot be a right which is purely hereditary in nature.
ground for nullity (ECE Realty and Development v. Mandap)
(4) it must have resulted in damage and injury to the party seeking Exception: The law allows a person to make a partition of his estate by
annulment (Alcasid v. CA). an act inter vivos, provided that the legitime of compulsory heirs is not
prejudiced (1080). This is the exception to the rule prohibiting contracts
 Silence or concealment, by itself, does not constitute fraud, upon a future inheritance (JLT).
o unless
 there is a special duty to disclose certain facts, or 4. Cause of Contract
 according to good faith and the usages of commerce the
communication should be made (1339). Cause and Motive
 Thus, when the seller has knowledge of a material fact which, if Article 1351, NCC. The particular motives of the parties in entering
communicated to the buyer, would render the sale unacceptable, into a contract are different from the cause thereof.
or at least, substantially less desirable, the non-disclosure of such
fact would amount to fraud. (Guinhawa v. People) (a) Cause: The cause or consideration is the why of the contracts, the
essential reason which moves the contracting parties to enter into
3. Object of Contract the contract. (Gonzales v. Trinidad)
Possible Object of Contracts: (b) Distinguished from Motive

Article 1347, NCC. All things which are not outside the commerce of
men, including future things, may be the object of a contract. All rights Cause Motive
which are not intransmissible may also be the object of contracts. Cause is the essential the particular reasons of a contracting
reason for the contract, party which do not affect the other party
No contract may be entered into upon future inheritance except in and which do not preclude the existence
cases expressly authorized by law. of a different consideration.
(1) Those which are entered into by guardians whenever the wards
 To clarify by an example: A thing purchased constitutes the whom they represent suffer lesion by more than one-fourth of
consideration (cause) for the purchaser and not the motives which the value of the things which are the object thereof;
have influenced his mind, like its usefulness, its perfection, its (2) Those agreed upon in representation of absentees, if the latter
relation to another, the use thereof which he may have in mind, suffer the lesion stated in the preceding number;
etc., a very important distinction, which precludes the annulment of (3) Those undertaken in fraud of creditors when the latter cannot in
the contract by the sole influence of the motives, unless the efficacy any other manner collect the claims due them;
of the former had been subordinated to compliance with the latter (4) Those which refer to things under litigation if they have been
as conditions. entered into by the defendant without the knowledge and
o Ordinarily, therefore, a party’s motives for entering into a approval of the litigants or of competent judicial authority;
contract do not affect the contract. (Uy v. CA) (5) All other contracts specially declared by law to be subject to
 Exception: The motive may be regarded as causa when it rescission.
predetermines the purpose of the contract. (E. Razon, Inc. v. PPA)
o Stated otherwise, the motive may be regarded as the causa (1) when the ward suffers lesion by more than ¼ of the value of the
when the realization of such motive or particular purpose has property in contracts entered into by guardians on behalf of wards;
been made a condition upon which the contract is made to (2) when the absentee suffers lesion by more than ¼ of the value of
depend. (PH National Construction Corp. v. CA) the property in contracts entered into by legal representatives on
o In this situation, the illegality of the motive shall render the behalf of absentees; or
contract void (1409[1]) because the motive is also the cause. (3) in partition among co-heirs, when any one of them received things
whose value is less than ¼ than the share to which he is entitled
Requisites for Cause (1098).
Article 1353, NCC. The statement of a false cause in contracts shall
render them void, if it should not be proved that they were founded S. Forms of Contracts, Reformation, and Interpretation of
upon another cause which is true and lawful. Contracts
Article 1354, NCC. Although the cause is not stated in the contract, 1. Forms of Contracts
it is presumed that it exists and is lawful, unless the debtor proves
the contrary. Effect of Formalities:
Article 1356, NCC. Contracts shall be obligatory, in whatever form
(1) It must exist - But cause is presumed to exist in a contract although they may have been entered into, provided all the essential requisites
not stated, unless the contrary is proved. for their validity are present. However, when the law requires that a
(a) However, if it is proven that the cause did not exist at the time contract be in some form in order that it may be valid or enforceable,
of the transaction, the contract is void. (1409[3]) or that a contract be proved in a certain way, that requirement is
(2) It must be true - The statement of a false cause in contracts shall absolute and indispensable. In such cases, the right of the parties
render them void (1353), unless it can be proven that they were stated in the following article cannot be exercised.
founded upon another cause which is true and lawful.
o If the price is simulated, the sale is void, but the act may be (a) GR: Contracts are obligatory, meaning both valid and enforceable,
shown to have been in reality a donation, or some other act or in whatever form they may have been entered into, provided all
contract. (1471) the essential requisites for their perfection are present.
 Hence, a deed of sale, in which the stated consideration (b) EXC: Form becomes an indispensable requirement:
had not in fact been paid, is null and void (Rongavilla v. (1) when the law requires a certain form to make the contract
CA). valid; or
o if the consideration or price stated in the contract is true (2) when the law requires a certain form in order that it may be
except that it is not paid, the contract is valid and results in enforceable or in order that it may be proved in a certain way.
a right to demand the fulfillment or cancellation of the
obligation (Buenaventura v. CA). Contracts which Require Form for Validity
 Thus, it is not the act of payment of price that determines (1) in donation of personal property where the value exceeds P5.000,
the validity of a contract of sale. both the donation and the acceptance must be writing; otherwise,
(3) It must be licit – a contract where the cause is contrary to law, the donation is void; (748)
morals, good customs, public order, or public policy is void (2) in donation of real property, both the donation and the acceptance
(1409[1]) and produces no effect whatever. (1352) must be in a public instrument; otherwise, the donation is void
(749);
Effect of Lesion or Inadequacy of Cause (3) in donation propter nuptias, same formalities applicable to ordinary
Article 1355, NCC. Except in cases specified by law, lesion or donations are required; otherwise, the donation propter nuptias is
inadequacy of cause shall not invalidate a contract, unless there has void (83 FC, in relation to 748, 749 CC);
been fraud, mistake or undue influence. (4) in express condonation intended to be effective during the lifetime
of the creditor, both the condonation and the acceptance must
Lesion or inadequacy of cause does not invalidate a contract, unless comply with the formalities applicable to ordinary donations;
there has been fraud, mistake, or undue influence. otherwise, the condonation is invalid (1270[2]);
(5) in contracts of partnership where real properties are contributed as
But in the following cases, lesion is a ground for rescission of the capital, there must be an inventory of the real properties
contract: contributed, signed by the parties, and attached to a public
Article 1381, NCC. The following contracts are rescissible: instrument; otherwise, the contract of partnership is void (1773, in
relation to 1771);
(6) in agency to sell a parcel of land or any interest therein, the a year from the making thereof (US Blue Valley
authority of the agent is required to be in writing; otherwise, the sale Creamery Co. v. Consolidated Products Co.);
by the agent is void (1874); (2) any special promise to answer for the debt, default, or
(7) any stipulation between the common carrier and the shipper or miscarriage of another - referring to the contracts of guaranty
owner limiting the liability of the former for the loss, destruction, or proper and suretyship;
deterioration of the goods to a degree less than extraordinary (3) an agreement in consideration of marriage, such as marriage
diligence must be in writing and signed by the shipper or owner; settlement (77 FC);
otherwise, the stipulation is not valid (1744[1]); (4) sale of goods, chattels, or things in action at a price not less
(8) in antichresis, it is necessary that the amount of the principal and than P500 – the Statute covers both tangible and intangible
of the interest of the principal obligation should be specified in personal property and also covers the assignment of choses
writing; otherwise, the contract of antichresis is void (2134); in action; hence, an assignment of a credit over P500 is
(9) in sale or transfer of large cattle, the same must be registered with governed by the Statute of Frauds;
the city/municipal treasurer and a certificate of transfer must be (5) sale of real property or any interest therein or lease of real
issued; otherwise, the sale or transfer is not valid (Act No. 1147 or property for more than a year, including an agreement for its
the Cattle Registration Act); and renewal;’"
(10) in chattel mortgage, the personal property must be recorded in the (6) representation as to the credit of a third person; and
chattel mortgage registry; otherwise, the chattel mortgage is not (7) an express trust concerning an immovable or any interest
valid (2149) therein (1443) – the latter is also in the nature of a statute of
frauds. (Peñalber v. Ramos)
Contracts Which Require Form for Enforceability (Statute of
Frauds) (b) Requirement of formality under Statute of Frauds
 Those contracts must be in writing or, if not in writing, there be
(a) Contracts governed by Statute of Frauds some note or memorandum thereof in writing subscribed by the
Article 1403, NCC. The following contracts are unenforceable, party charged (or the party against whom enforcement is sought)—
unless they are ratified:  the note or memorandum must contain the name of the parties, the
(1) Those entered into in the name of another person by one who terms and conditions of the contract, and a description of the
has been given no authority or legal representation, or who has property sufficient to render it capable of identification (Swedish
acted beyond his powers; Match, AB v. CA) and must contain the essential elements of the
(2) Those that do not comply with the Statute of Frauds as set forth contract expressed with certainty that may be ascertained from the
in this number. In the following cases an agreement hereafter note or memorandum itself, or some other writing to which it refers
made shall be unenforceable by action, unless the same, or or within which it is connected, without resorting to parol evidence.
some note or memorandum, thereof, be in writing, and
subscribed by the party charged, or by his agent; evidence, (c) Principles governing Statute of Frauds
therefore, of the agreement cannot be received without the (1) the form required under the Statute of Frauds is for evidentiary
writing, or a secondary evidence of its contents: purposes only; hence, if the parties permit a contract to be
(a) An agreement that by its terms is not to be performed proved, without any objection, it is then just as binding as if
within a year from the making thereof; the Statute has been complied with;
(b) A special promise to answer for the debt, default, or (2) the Statute of Frauds applies only to executory contracts
miscarriage of another; (MCIAA v. Tudtud) and it does not apply to contracts which
(c) An agreement made in consideration of marriage, other have been completely or partially performed;
than a mutual promise to marry; (3) the Statute of Frauds does not apply to actions which are
(d) An agreement for the sale of goods, chattels or things in neither for violation of a contract nor for the performance (Asia
action, at a price not less than five hundred pesos, unless Productions Co., Inc. v. Paño);
the buyer accept and receive part of such goods and (4) the Statute of Frauds may be invoked only by a party to the
chattels, or the evidences, or some of them, of such things oral contract not by a stranger thereto (1408);
in action, or pay at the time some part of the purchase (5) the defense of the Statute of Frauds can be waived either by;
money; but when a sale is made by auction and entry is (i) failing to object to the presentation of oral evidence to
made by the auctioneer in his sales book, at the time of the prove the contract or
sale, of the amount and kind of property sold, terms of sale, (ii) accepting benefits under the contract (1405); and
price, names of the purchasers and person on whose (6) the Statute of Frauds refers to specific kinds of transactions
account the sale is made, it is a sufficient memorandum; and cannot apply to any other transaction that is not
(e) An agreement for the leasing for a longer period than one enumerated in 1403(2) and 1443. (Cruz v. JM Tuason)
year, or for the sale of real property or of an interest therein;
(f) A representation as to the credit of a third person. Article 1405, NCC. Contracts infringing the Statute of Frauds,
(3) Those where both parties are incapable of giving consent to a referred to in No. 2 of article 1403, are ratified by the failure to object
contract. to the presentation of oral evidence to prove the same, or by the
acceptance of benefits under them.
(1) an agreement that by its terms is not to be performed within a
year from the making thereof is required to be in writing to be Article 1408, NCC. Unenforceable contracts cannot be assailed by
enforceable under the Statute of Frauds third persons.
(i) applies only to agreements not to be performed on
either side within a year from the making thereof Contracts Which Require Form for Convenience Only
(National Bank v. PH Vegetable Oil Co.) Article 1358, NCC. The following must appear in a public document:
(ii) test to determine whether an oral contract is enforceable (1) Acts and contracts which have for their object the creation,
under the 1-year rule of the Statute of Frauds is whether, transmission, modification or extinguishment of real rights over
under its own terms, performance is possible within
immovable property; sales of real property or of an interest

therein are governed by articles 1403, No. 2, and 1405; Concept and Requisites
(2) The cession, repudiation or renunciation of hereditary rights or (a) Definition: Reformation is defined as a remedy in equity, whereby
of those of the conjugal partnership of gains; a written instrument is made or construed so as to express or
(3) The power to administer property, or any other power which has conform to the real intention of the parties, where some error or
for its object an act appearing or which should appear in a public mistake has been committed. (BF Corp. v. Form-Eze Systems, Inc)
document, or should prejudice a third person;
(4) The cession of actions or rights proceeding from an act (a) Requisites of Reformation:
appearing in a public document. (1) there must have been a meeting of the minds of the parties to
the contract;
All other contracts where the amount involved exceeds five hundred (2) the instrument does not express the true intention of the
pesos must appear in writing, even a private one. But sales of goods, parties; and
chattels or things in action are governed by articles 1403, No. 2 and (3) the failure of the instrument to express the true intention of the
1405. parties is due to mistake, fraud, inequitable conduct, or
accident.
(a) Contracts required to be in public document under Article
1358 If the mistake is mutual, the instrument may be reformed if the
(1) acts and contracts which have for their object the creation, following requisites are present:
transmission, modification, or extinguishment of real rights (1) the mistake should be of fact;
over immovable property, such as a contract of real estate (2) the same should be proved by clear and convincing evidence; and
mortgage; (3) the mistake should be common to both parties to the instrument.
(2) cession, repudiation, or renunciation of hereditary rights or of (BPI v. Fidelity & Surety Co.)
those of the conjugal partnership of gains;
(3) power to administer property, or any other power which has Instances Where Instalment May Not Be Reformed
for its object an act appearing or which should appear in a Article 1359, NCC. When, there having been a meeting of the minds
public document, or should prejudice a third person; and of the parties to a contract, their true intention is not expressed in the
(4) cession of actions or rights proceeding from an act appearing instrument purporting to embody the agreement, by reason of
in a public document. All other contracts where the amount mistake, fraud, inequitable conduct or accident, one of the parties
involved exceeds P500 must appear in writing, may ask for the reformation of the instrument to the end that such
true intention may be expressed.
(b) Purpose of requirement in Article 1358
 The provision of Article 1358 CC on the necessity of a public If mistake, fraud, inequitable conduct, or accident has prevented a
document is only for convenience, not for validity or enforceability. meeting of the minds of the parties, the proper remedy is not
(Dailon v. CA) reformation of the instrument but annulment of the contract.
 Noncompliance with formal requisites does not adversely affect the
validity of the contract or the contractual rights and obligations of Article 1366, NCC. There shall be no reformation in the following
the parties. (Agasen v. CA) cases:
(1) Simple donations inter vivos wherein no condition is imposed;
(c) Remedy for non-compliance with formality under Article 1358 (2) Wills;
Article 1357, NCC. If the law requires a document or other special (3) When the real agreement is void.
form, as in the acts and contracts enumerated in the following article,
the contracting parties may compel each other to observe that form, Article 1367, NCC. When one of the parties has brought an action
once the contract has been perfected. This right may be exercised to enforce the instrument, he cannot subsequently ask for its
simultaneously with the action upon the contract. reformation.
Article 1406, NCC. When a contract is enforceable under the Statute (1) if mistake, fraud, inequitable conduct, or accident has prevented a
of Frauds, and a public document is necessary for its registration in meeting of the minds of the parties— instead, the remedy is
the Registry of Deeds, the parties may avail themselves of the right annulment of the contract and not reformation;
under Article 1357. (2) in simple donations inter vivos wherein no condition is imposed;
(1366)
 For contracts which are required to be in a public document under (3) in wills;
Article 1358, the contracting parties may compel each other to (4) when the real agreement is void;
observe that form and this right may be exercised simultaneously (5) when one of the parties has brought an action to enforce the
with the action upon the contract. instrument, he cannot subsequently ask for its reformation; and
 But in order for this remedy to be exercised, it is necessary that the (6) when the contract is unenforceable because of failure to comply
following requisites must concur: with the Statute of Frauds.
(1) the contract must have already been perfected;
(2) the contract must have been valid as to form; (1356) and Some Important Rules of Interpretation
(3) the contract must have been enforceable under the Statute of Article 1372, NCC. However general the terms of a contract may be,
Frauds. they shall not be understood to comprehend things that are distinct
 Thus, when a contract is enforceable under the Statute of Frauds, and cases that are different from those upon which the parties
and a public document is necessary for its registration in the intended to agree.
Registry of Deeds, the parties may avail themselves of the right
under Article 1357. (1406)
2. Reformation and Interpretation of Contracts

Article 1373, NCC. If some stipulation of any contract should admit

of several meanings, it shall be understood as bearing that import 2. Rescissible Contracts
which is most adequate to render it effectual.
Distinctions Between Rescission in Articles 1191 and 1381
Article 1374, NCC. The various stipulations of a contract shall be Article 1381, NCC. The following contracts are rescissible:
interpreted together, attributing to the doubtful ones that sense which (1) Those which are entered into by guardians whenever the wards
may result from all of them taken jointly. whom they represent suffer lesion by more than one-fourth of
the value of the things which are the object thereof;
Article 1377, NCC. The interpretation of obscure words or (2) Those agreed upon in representation of absentees, if the latter
stipulations in a contract shall not favor the party who caused the suffer the lesion stated in the preceding number;
obscurity. (3) Those undertaken in fraud of creditors when the latter cannot in
any other manner collect the claims due them;
(1) Contra Proferentem (construe against drafting party) - the (4) Those which refer to things under litigation if they have been
interpretation of obscure words or stipulations in a contract shall entered into by the defendant without the knowledge and
not favor the party who caused the obscurity (1377), applicable in approval of the litigants or of competent judicial authority;
contracts of adhesion; (Wood Technology Corp. v. Equitable (5) All other contracts specially declared by law to be subject to
Banking Corp.) rescission.
(2) Principle of Effectiveness - where two interpretations of the same
contract language are possible, one interpretation having the effect Article 1191, NCC. X
of rendering the contract meaningless, while the other
interpretation would give effect to the contract as a whole, the latter 1191 1381
interpretation must be adopted; (1373) the rescission under Article 1191 the rescission under Article 1381
(3) Complementary-contracts-construed-together doctrine - an is on account of breach of is by reason of lesion or
accessory contract must be read in its entirety and together with contract (more properly called economic prejudice (ASB Realty
the principal agreement (PH Bank of Communications v. Lim), “resolution”); Corp. v. Ortigas & Company);
based on Article 1374 CC;
(4) Ejusdem generis — however general the terms of a contract may Rescission is not predicated on Rescission under Article 1381,
be, they shall not be understood to comprehend things that are injury to economic interests of the cause of action is
distinct and cases that are different from those upon which the the party plaintiff but on the subordinated to the existence of
parties intended to agree. (1372) breach of faith by the defendant lesion or economic prejudice
that violates the reciprocity because it is the raison d ‘etre as
T. Defective Contracts between the parties well as the measure of the right
to rescind;
1. Classification of Contracts as to Defects the contract is perfectly valid the contract is defective
applies exclusively to reciprocal rescission applies to all kinds of
Perfectly Valid: If the contract does not suffer from any defect. obligations obligations arising from
contracts, whether the same be
Defective Contracts: reciprocal in character or not
In the order of their defects, from least to most defective: principal action which seeks the rescission is only a subsidiary
(1) Rescissible Contract – it is considered valid, binding, and resolution or cancellation of the remedy, meaning, it cannot be
effective until it is rescinded and contains all the requisites of a valid contract instituted except when the
contract and are considered legally binding, but by reason of injury party suffering damage has no
or damage (lesion) to either of the contracting parties or to third rescission as a principal action other legal means to obtain
persons, such as creditors, it is susceptible to rescission at the under Article 1191 prescribes reparation for the same (Unlad
instance of the party who may be prejudiced thereby; within 10 years from the time the Resources Dev. Corp. v.
(2) Voidable Contract – one in which the essential requisites for right of action accrues Dragon)
validity under Article 1318 are present (Francisco v. Herrera), but consequently, the four-year
may be annulled because of want of capacity or the vitiated consent prescriptive period in Article
of one of the parties; however, before such annulment, the contract 1389 applies only to rescission
is existent, valid, and binding, hence, considered effective and as a subsidiary remedy and not
obligatory between parties (First PH Holdings Corp. v. Trans Middle to rescission as a principal action
East), but it may be rendered perfectly valid by ratification, which under Article 1191
can be express or implied; only a contracting party can be even a third person can become
(3) Unenforceable Contract – that which cannot be enforced by a injured and can maintain an an injured party in the rescission
proper action in court, unless it is ratified, because either it is action for rescission contemplated under Article
entered into without or in excess of authority or it does not comply 1381, as in the case of contracts
with the Statute of Frauds or where both of the contracting parties in fraud of the creditor
do not possess the required legal capacity (Mercado v. Allied the court has discretionary court must order the rescission
Banking Corp.); prior to ratification, the contract is valid but it cannot power not to grant the rescission once the ground is proven
be enforced by a proper action in court, but once ratified, either if there be just cause for the
expressly or impliedly, it is rendered perfectly valid and becomes fixing of a period for the
obligatory between the parties; and performance of the obligation
(4) Void or Inexistent Contract – one which has no force and effect
from the very beginning; hence, it is as if it has never been entered Nature of Rescissible Contracts under Article 1381
into and cannot be validated either by the passage of time or by
ratification.
Article 1380, NCC. Contracts validly agreed upon may be rescinded (b) from the time that the domicile of the absentee is known, for
in the cases established by law. contracts entered into by the legal representative on behalf of
the absentee; and
Article 1389, NCC. The action to claim rescission must be (c) for contracts in fraud of creditors, only when the creditor
commenced within four years. discovers that he has no other legal remedy for the
For persons under guardianship and for absentees, the period of four satisfaction of his claim against the debtor other than an action
years shall not begin until the termination of the former’s incapacity, pauliana—
or until the domicile of the latter is known.  in other words, an action pauliana presupposes the following:
o (i) a judgment against the debtor;
(1) these contracts are valid and enforceable, therefore obligatory, o (ii) the issuance by the trial court of a writ of execution for the
until they are rescinded by a competent court; satisfaction of the judgment, and
(2) while these contracts are valid and obligatory, they cause o (iii) the failure of the sheriff to enforce and satisfy the judgment
pecuniary lesion or prejudice to one of the contracting parties or to of the court. (Khe Hong Cheng v. Chua)
a third person, for which reason the law grants the remedy of
rescission to protect the injured party from all injury and damage Specific Contracts which are Rescissible
that the contract may cause, or to protect some incompatible and Article 1386, NCC. Rescission referred to in Nos. 1 and 2 of article
preferential right created by the contract (Aquino v. Tañedo); 1381 shall not take place with respect to contracts approved by the
(3) the defect of a rescissible contract under Article 1381 may not, courts.
however, be cleansed by ratification although the right of action for
rescission may be lost by way of extinctive prescription; and Article 1387, NCC. All contracts by virtue of which the debtor
(4) the defect of a rescissible contract cannot be attacked collaterally alienates property by gratuitous title are presumed to have been
but must be set up in an independent civil action and only after a entered into in fraud of creditors, when the donor did not reserve
full blown trial. (Air France v. CA) sufficient property to pay all debts contracted before the donation.
Requisites for Rescission to Prosper Alienations by onerous title are also presumed fraudulent when made
Article 1382, NCC. Payments made in a state of insolvency for by persons against whom some judgment has been rendered in any
obligations to whose fulfillment the debtor could not be compelled at instance or some writ of attachment has been issued. The decision
the time they were effected, are also rescissible. or attachment need not refer to the property alienated, and need not
have been obtained by the party seeking the rescission.
Article 1383, NCC. The action for rescission is subsidiary; it cannot
be instituted except when the party suffering damage has no other In addition to these presumptions, the design to defraud creditors
legal means to obtain reparation for the same. may be proved in any other manner recognized by the law of
evidence.
Article 1385, NCC. Rescission creates the obligation to return the
things which were the object of the contract, together with their fruits, Article 1409, NCC. The following contracts are inexistent and void
and the price with its interest; consequently, it can be carried out only from the beginning:
when he who demands rescission can return whatever he may be (1) Those whose cause, object or purpose is contrary to law,
obliged to restore. morals, good customs, public order or public policy;
(2) Those which are absolutely simulated or fictitious;
Neither shall rescission take place when the things which are the (3) Those whose cause or object did not exist at the time of the
object of the contract are legally in the possession of third persons transaction;
who did not act in bad faith. (4) Those whose object is outside the commerce of men;
(5) Those which contemplate an impossible service;
In this case, indemnity for damages may be demanded from the (6) Those where the intention of the parties relative to the principal
person causing the loss. object of the contract cannot be ascertained;
(7) Those expressly prohibited or declared void by law.
(1) the action for rescission must originate from any of the causes
specified in Articles 1381 and 1382; These contracts cannot be ratified. Neither can the right to set up the
(2) the party suffering damage and who is asking for rescission has no defense of illegality be waived.
other legal means to obtain reparation for the damage suffered by
him (1382); Article 1410, NCC. The action or defense for the declaration of the
(3) the person demanding rescission must be able to return what he inexistence of a contract does not prescribe.
may be obliged to restore if rescission is granted by the court
(1385[1]) —but this requisite does not apply to a creditor suing for (a) Contracts entered into by guardians or legal representative
rescission under Article 1381, paragraph 3, because he received where ward or absentee suffers lesion
nothing from the contract which he seeks to rescind; (1) contract is entered into by a guardian on behalf of the ward or
(4) the things which are the object of the contract must not be legally by the legal representative;
in the possession of third persons who did not act in bad faith; (2) the ward or the absentee suffers lesion by more than ¼ of the
(1385[2]) and value of the things which are the object thereof; (1381)
(5) the action for rescission must be filed within four years from the (3) the contract must not have been approved by the court;
accrual of the right of action (1389) —the four-year prescriptive otherwise, the contract is perfectly valid (1386); and
period commences to run: (4) the contract must not involve disposition or encumbrance of
(a) from the termination of the ward’s incapacity, for contracts the real property of the ward or of the absentee; otherwise, the
entered into by guardians on behalf of the ward; contract is not merely rescissible but unenforceable under
Article 1403(1) if entered into without judicial approval, even if
there is no lesion. (Rules 95, 96, 107)
(b) Contracts in fraud of creditor (v) the transfer of all or nearly all of his property by a debtor,
(1) Presupposes existence of valid contracts: Contracts which especially when he is insolvent or greatly embarrassed
are rescissible under Article 1381(3) are valid contracts, albeit financially;
undertaken in fraud of creditors, and not absolutely simulated, (vi) the fact that the transfer is made between father and son,
because the latter is not merely rescissible but inexistent, when there are present other of the above circumstances
albeit undertaken as well in fraud of creditors. (Manila Banking (vii) the failure of the vendee to take exclusive possession of
Corp. v. Silverio) They differ, as follows: all the property. (Oria v. Mcmicking)
(c) Contracts over things under litigation
Absolute Simulation Fraudulent Alienation (1) the defendant, during the pendency of the case, enters into a
implies that there is no existing there is a true and existing contract which refers to the thing subject of litigation; and
contract, no real act executed transfer or contract (2) the said contract was entered into without the knowledge and
can be attacked by any creditor, can be assailed only by the approval of the litigants or of a competent judicial authority.
including one subsequent to the creditors before the alienation (1381[4])
contract (d) Payment made under state of insolvency: any payment made
the insolvency of the debtor the action to rescind, or action by an insolvent debtor of an obligation the fulfillment of which could
making the simulated transfer is pauliana, requires that the not be compelled at the time of the payment is considered
not a prerequisite to the nullity of creditor cannot recover in any fraudulent and is, therefore, rescissible. (1382)
the contract other manner what is due him
an action to declare a contract an action pauliana to rescind a Right of First Refusal
absolutely simulated does not fraudulent alienation prescribes (a) Concept: A right of first refusal is a contractual grant, not of the sale
prescribe (1409 and 1410) in 4 years of a property, but of the first priority to buy the property in the event
the owner sells the same. (PUP v. Golden Horizon Realty Corp.)
(2) Requisites of Action Pauliana: The rescissory action to set (1) Such grant may be embodied in a separate contract, in which
aside contracts in fraud of creditors is known as action case it must be supported by its own consideration distinct
pauliana (Siguan v. Lim). To prosper, it must satisfy the and separate from the consideration supporting the
following requisites: contemplated contract, or
(i) the plaintiff asking for rescission has a credit prior to the (2) it may only be a part of a certain contract, such as when it is
alienation, although demandable later; one of the provisions in a lease contract. In the latter case, the
(ii) the debtor has made a subsequent contract conveying a right of first refusal is an integral and indivisible part of the
patrimonial benefit to a third person; contract of lease making the consideration for the lease the
(iii) the creditor has no other legal remedy to satisfy his same as that for the right of first refusal. (Equatorial)
claim;
(iv) the act being impugned is fraudulent; (b) Distinguished from Option: while both create an exclusive
(v) the third person who received the property conveyed, if privilege to enter into a contract with someone else, they differ
it is by onerous title, has been an accomplice in the fraud; as follows
(vi) the conveyance must not be absolutely simulated.
(3) Contract in violation of right of first refusal (RFR) is in Option Right of First Refusal
fraud of creditor an option or an offer would the object might be made
(i) A contract entered into in violation of a right of first refusal require, among other determinate, the exercise of the right,
of another person is rescissible (Rosencor Dev. Corp. v. things, a clear certainty on however, would be dependent not
Inquing) and considered in fraud of the creditor because both the object and the only on the grantor’s eventual
the term creditors in Article 1381(3) is broad enough to cause or consideration of intention to enter into a binding
include the obligee under an option contract as well as the envisioned contract juridical relation with another but also
under a right of first refusal, sometimes known as a right (Ang Yu), in other words, on terms, including the price, that
of first priority. (Equatorial Realty Dev. Inc. v. Mayfair there is a definite offer obviously are yet to be later firmed up
Theater) the exercise of the privilege the period for the exercise of the
(4) Presumption of fraud: Fraud is presumed in the is always for a fixed period privilege may either be definite or
following: indefinite; (Tuason v. Del Rosario)
(i) there is alienation of property by gratuitous title by the being an onerous contract, the grant may either be gratuitous or
debtor who has not reserved sufficient property to pay the consideration must be onerous, except that a party to a
his debts contracted before such alienation; or something of value, contract cannot unilaterally withdraw
(ii) there is alienation of property by onerous title made by a although its kind may vary a right of first refusal that stands upon
debtor against whom some judgment has been rendered (Villamor v. CA) valuable consideration. (PUP)
in any instance or some writ of attachment has been
issued. The decision or attachment need not refer to the (c) Effect of violation of RFR
property alienated and need not have been obtained by (1) If grantor entered into contract with third person:
the party seeking rescission. (1387) (a) The contract can be rescinded if the third person acted in
(5) Badges of fraud bad faith (or with knowledge of the existence of the RFR)
(i) the fact that the consideration of the conveyance is (Guzman v. Bonnevie) however,
fictitious or is inadequate; (b) if the third person acted in good faith, the contract may not
(ii) a transfer made by a debtor after suit has begun and be rescinded (Rosencor) and the remedy of the grantee is
while it is pending against him; simply to recover damages from the grantor.
(iii) a sale upon credit by an insolvent debtor; (2) Upon rescission of contract: the grantor may now be directed to
(iv) evidence of large indebtedness or complete insolvency; comply with his obligation to sell the property to the grantee under
the same terms and conditions that it had been sold to a third
person. In other words, there should be identity of terms and
conditions to be offered to the buyer holding the right of first refusal. And when the action refers to contracts entered into by minors or
(Parañaque Kings Enterprises, Inc. v. CA) other incapacitated persons, from the time the guardianship ceases.
Effects of Rescission (a) Concept

Article 1385, NCC. Rescission creates the obligation to return the (1) Voidable or annullable contracts are existent, valid, and
things which were the object of the contract, together with their fruits, binding, although they can be annulled because of want of
and the price with its interest; consequently, it can be carried out only capacity or the vitiated consent of one of the parties. However,
when he who demands rescission can return whatever he may be before such annulment, they are considered effective and
obliged to restore. obligatory between parties (First PH Holdings Corp. v. Trans
Middle East).
Neither shall rescission take place when the things which are the (2) Hence, it is valid until it is set aside and its validity may be
object of the contract are legally in the possession of third persons assailed only in an action for that purpose.
who did not act in bad faith. (3) They can be confirmed or ratified. (MWSS v. CA)
(b) Characteristics
In this case, indemnity for damages may be demanded from the (1) it is existent, valid, and binding and produces all its civil
person causing the loss. effects, until it is set aside by a final judgment of a competent
court in an action for annulment (1390[2]);
(1) It has the effect of unmaking a contract, or its undoing from the (2) But it suffers from a defect in the form of vitiation of consent
beginning, and not merely its termination. (Unlad Resources) by lack of legal capacity of one of the contracting parties, or
(2) Hence, the necessary consequence of rescission is mutual by mistake, violence, intimidation, undue influence, or fraud;
restitution, that is, the parties to a rescinded contract must be (3) it may be rendered perfectly valid by ratification, which can be
brought back to their original situation prior to the inception of the express or implied, such as by accepting and retaining the
contract; hence, they must return what they received pursuant to benefits of a contract (Francisco v. Herrera);
the contract. (1385) (4) it is susceptible of validation by prescription since the action
(3) Mutual restitution is also required in cases involving rescission for the annulment of contract prescribes in 4 years (1391);
under Article 1191. (Gotesco Properties, Inc. v. Fajardo) (5) it cannot be attacked collaterally; its validity can only be
assailed directly either by an action for that purpose or by way
Who May Bring Action and Against Whom of a counterclaim (Llacer v. Muñoz de Bastillo).
The action for rescission may be brought by: (c) Remedy of Annulment
(1) the person who is injured by the rescissible contract, that is,  To annul means to reduce to nothing; annihilate; obliterate; to
the ward or absentee, the creditors damaged or the plaintiff in case make void or of no effect; to nullify; to abolish; to do away with
a thing in litigation is alienated by defendant; (Suntay v. Cojuangco-Suntay).
(2) the heirs of the above persons; and o Hence, a contract that is annulled presupposes that it
(3) the creditors of the aforesaid persons by virtue of Article 1177. subsists but later ceases to have legal effect when it is
terminated through a court action.
On the other hand, the action may be brought against the following: o In annulment, it is the judgment of the court that produces the
(1) the author of the injury and his successors in interest; and invalidity of the contract.
(2) third persons who have acquired in bad faith the property  It is to be distinguished from declaration of nullity of contracts.
alienated in fraud of creditors. o Null and void means that something does not exist from
the beginning.
3. Voidable Contracts o Thus, a void contract is invalid from the beginning and in
declaring its nullity the court simply declares a status or
Concept, Characteristics, and Remedy condition which already exists from the very beginning.
Article 1390, NCC. The following contracts are voidable or
annullable, even though there may have been no damage to the Two Kinds of Voidable Contracts
contracting parties: (1) where one of the parties is incapable of giving consent to a
(1) Those where one of the parties is incapable of giving consent to contract (1390[1]) —
a contract; o if both parties are incapable of giving consent to a contract,
(2) Those where the consent is vitiated by mistake, violence, the contract is not merely voidable but unenforceable
intimidation, undue influence or fraud. (1403[3]); and
(2) where both parties are capable of giving consent to a contract, but
These contracts are binding, unless they are annulled by a proper the consent of one is vitiated by mistake, violence,
action in court. They are susceptible of ratification. intimidation, undue influence, or fraud (1390[2]).
Article 1391, NCC. The action for annulment shall be brought within Personality to File Annulment and Prescriptive Period
four years. Article 1397, NCC. The action for the annulment of contracts may
be instituted by all who are thereby obliged principally or subsidiarily.
This period shall begin: However, persons who are capable cannot allege the incapacity of
those with whom they contracted; nor can those who exerted
In cases of intimidation, violence or undue influence, from the time intimidation, violence, or undue influence, or employed fraud, or
the defect of the consent ceases. caused mistake base their action upon these flaws of the contract.
In case of mistake or fraud, from the time of the discovery of the (a) Who can file for annulment: Before a party can have the standing
same. to institute an action for annulment, he must either be:
(1) the party obliged principally or subsidiarily in the contract
which he seeks to annul (1397) —by way of exception, a
person who is not a party obliged principally or conformity of the contracting party who has no right to bring the
subsidiarily under a contract may exercise an action for action for annulment;
annulment of the said contract if: (3) it should be effected with the knowledge of the vice or defect (1393)
(i) he is prejudiced in his rights with respect to one of the —before a contract can be ratified, knowledge of its existence must
contracting parties; and be brought to the parties who have authority to ratify it or
(ii) he can show detriment which would positively result to circumstances must be shown from which such knowledge may be
him from the contract in which he has no intervention presumed (Yu Chuck v. Kong Li Po); and
(Teves v. People’s Homesite & Housing Corp.); (4) the cause of the nullity or defect should have already disappeared.
(2) he must be the party suffering from incapacity to give
consent or the victim of intimidation, violence, undue (d) Effects of Ratification
influence, fraud, or mistake—persons who are capable Article 1396, NCC. Ratification cleanses the contract from all its
cannot allege the incapacity of those with whom they defects from the moment it was constituted.
contracted; nor can those who exerted intimidation, violence,
or undue influence, or employed fraud, or caused mistake  The effect of ratification is retroactive. It cleanses the contract from
based their action upon these flaws of the contract. all its defects from the moment it was constituted, thereby
(b) Prescriptive period: The period of prescription is 4 years and it extinguishing the action to annul a voidable contract (1392).
commences to run, as follows:  It results, therefore, that after a contract is validly ratified, no action
(1) from the time the defect ceases if the ground for annulment to annul the same can be maintained based upon defects relating
is vitiation of consent by intimidation, violence, or undue to its original validity (Tang Ah Chan v. Gonzales).
influence (1391[2]) and it cannot be interrupted by an
extrajudicial demand made by the party whose consent was Effects of Annulment
vitiated (Miailhe v. CA); Article 1398, NCC. An obligation having been annulled, the
(2) from the time of the discovery if the ground for annulment is contracting parties shall restore to each other the things which have
vitiation of consent by mistake or fraud —if the fraudulent been the subject matter of the contract, with their fruits, and the price
conveyance is registered in the Register of Deeds, the with its interest, except in cases provided by law.
discovery of fraud is reckoned from the time the document
was registered in the Register of Deeds in view of the rule that In obligations to render service, the value thereof shall be the basis
registration is notice to the whole world (Metropolitan Fabrics, for damages.
Inc. v. Prosperity Credit Resources, Inc);
(3) from the time the minor reaches the age of majority or 18 Article 1399, NCC. When the defect of the contract consists in the
years of age if the ground for annulment is want of capacity incapacity of one of the parties, the incapacitated person is not
by reason of minority (1391[3]); and obliged to make any restitution except insofar as he has been
(4) from the time the guardianship ceases if the ground for benefited by the thing or price received by him.
annulment is want of capacity other than minority.
Article 1402, NCC. As long as one of the contracting parties does
Ratification
not restore what in virtue of the decree of annulment he is bound to
Article 1393, NCC. Ratification may be effected expressly or tacitly.
return, the other cannot be compelled to comply with what is
It is understood that there is a tacit ratification if, with knowledge of
incumbent upon him.
the reason which renders the contract voidable and such reason
having ceased, the person who has a right to invoke it should execute
 GR: If a voidable contract is annulled by a final judgment of a
an act which necessarily implies an intention to waive his right.
competent court, the contract is invalidated from the very
beginning. Since the contract is declared void at inception, the
Article 1394, NCC. Ratification may be effected by the guardian of
parties shall be restored to their original status prior to the inception
the incapacitated person.
of the contract as if no contract has been made, thus, upon
annulment, the parties should be restored to their original position
Article 1395, NCC. Ratification does not require the conformity of the by mutual restitution (1398).
contracting party who has no right to bring the action for annulment. o As a consequence, as long as one of the contracting parties
does not restore what in virtue of the decree of annulment he
(a) Concept: Ratification or confirmation refers to the act of or means is bound to return, the other cannot be compelled to comply
by virtue of which efficacy is given to a contract which suffers from with what is incumbent upon him (1402).
a vice of curable nullity.  EXC: When the defect of the contract consists in the incapacity of
(b) How Made: It may be effected expressly or tacitly. one of the parties, the incapacitated person is not obliged to make
(1) A tacit ratification is the execution of an act which necessarily any restitution except insofar as he has been benefited by the thing
implies an intention to waive the right to annul (1393), such as or price received by him (1399).
by accepting and retaining the benefits of a contract.
(Francisco v. Herrera) 4. Unenforceable Contracts
(c) Requisites Concept, Nature, and Characteristics

(1) the contract has all the essential requisites, but it is tainted with a Article 1408, NCC. Unenforceable contracts cannot be assailed by
vice which is susceptible of being cured; third persons.
(2) it should be effected by the person who is entitled to do so
under the law—the right to ratify the defect of the contract belongs
(a) Concept: Those contracts which cannot be enforced by a proper
only to the party who has the right to bring the action for annulment
action in court, unless they are ratified, because either they are
(1394, 1395), although such ratification may also be effected by the
entered into without or in excess of authority or they do not
guardian of the incapacitated person, and it does not require the
comply with the Statute of Frauds or both of the contracting
parties do not possess the required legal capacity. (Iglesia one of the contracting parties "shall give the same effect
Filipina Independiente v. Heirs of Bernardino Taeza) as if only one of them were incapacitated, making the
(b) Nature and Characteristics contract merely voidable.
(1) It is a valid contract although it cannot be sued upon or be (ii) If ratification is made on the part of both parties, "the
enforced by a proper action in court because of its defect. contract shall be validated from the inception.
(2) The defect of the contract consists of either:
(i) it is entered into without or in excess of authority; 5. Void or Inexistent Contracts
(ii) it does not comply with the Statute of Frauds; or
(iii) both of the contracting parties are incapable of giving Concept and Characteristics
consent to a contract. (a) Concept
(3) Since an unenforceable contract, though valid, is not  A void or inexistent contract is one which has no force and effect
enforceable by a proper action in court, it is not binding or from the beginning, as if it has never been entered into, and which
obligatory between the parties, unless the contract is ratified. cannot be validated either by time or ratification (Heirs of Policarpio
But unlike a void contract which is not susceptible to Ureta, Sr. v. Heirs of Liberato Ureta).
ratification, an unenforceable contract can be ratified.  A void contract produces no effect whatsoever either against or in
(4) The defect is purely a matter of defense. There is no action favor of anyone; it does not create, modify, or extinguish the
that may be filed to set aside the contract and the contract is juridical relation to which it refers.
not susceptible of validation by prescription.
(5) The defense that the contract is unenforceable is available (b) Characteristics
only to the contracting parties. The contract cannot be Article 1410, NCC. The action or defense for the declaration of the
assailed by third persons. inexistence of a contract does not prescribe.
Three Kinds of Unenforceable Contracts Article 1412, NCC. If the act in which the unlawful or forbidden cause
Article 1407, NCC. In a contract where both parties are incapable of consists does not constitute a criminal offense, the following rules
giving consent, express or implied ratification by the parent, or shall be observed:
guardian, as the case may be, of one of the contracting parties shall (1) When the fault is on the part of both contracting parties, neither
give the contract the same effect as if only one of them were may recover what he has given by virtue of the contract, or
incapacitated. demand the performance of the other’s undertaking;
(2) When only one of the contracting parties is at fault, he cannot
If ratification is made by the parents or guardians, as the case may recover what he has given by reason of the contract, or ask for
be, of both contracting parties, the contract shall be validated from the fulfillment of what has been promised him. The other, who
the inception. is not at fault, may demand the return of what he has given
without any obligation to comply with his promise.
(a) Unauthorized Contracts
(1) GR: Contracts entered into in the name of another person by (1) GR: they produce no legal effects whatsoever in
one who has been given no authority or legal representation accordance with the principle “quod nullum est nullum
or who has acted beyond his powers are unenforceable producit effectum”; hence, it does not create, modify, or
(1403[1]), not void. extinguish the juridical relation to which it refers.
(i) If the principal does not ratify the contract, it may not be  EXC: the void contract has already been performed and
enforced against him. the principle of in pari delicto is applied.
(ii) If he ratifies the contract, the ratification retroacts to the  Under this principle, the guilty parties to an illegal
day when the agent entered into such contract. contract cannot recover from one another and are not
(iii) Contracts entered into by guardians on behalf of the entitled to affirmative relief (1412[1]). Thus, the contract,
ward or by legal representatives on behalf of the though void, has produced an effect.
absentee involving disposition or encumbrance of real (2) They are not susceptible of ratification (Ureta) and, as
property of the ward or of the absentee without judicial between the parties to the contract, the validity cannot be
approval are unenforceable. (Rule 95, 96, 107) given to it by estoppel; thus, it is immaterial that the parties
(2) EXC: An unauthorized contract involving the sale of a initially acted to implement the contract, believing in good faith
parcel of land is not merely unenforceable but void ab that the same was valid (Nool v. CA).
initio because the law requires the authority of the agent (3) The right to set up the defense of inexistence or absolute
to be in writing, in case of agency to sell a parcel of land or nullity cannot be waived or renounced. (Ureta)
any interest therein; otherwise, the sale is void (1874). Thus, (4) The action or defense for the declaration of their inexistence
the sale of a parcel of land made by the son on behalf of his or absolute nullity is imprescriptible (1410) —however, the
father but without the latter’s consent or authority is void right to have a contract declared void ab initio may be barred
because of failure to comply with the requirement of Article by laches although not barred by prescription (MWSS v. CA).
1874. (5) The inexistence or absolute nullity of a contract cannot
(b) Contracts Which Violate the Requirement of Statute of Frauds be invoked by a person whose interests are not directly
(c) Contract Where Both Parties are Incapacitated: affected (Ureta). Stated otherwise, the right to set up the
(1) Where only one of the parties is incapable of giving nullity of a void or non-existent contract is not limited to the
consent to a contract, the contract is merely voidable parties, as in the case of annullable or voidable contracts; it is
(1390[1]); but if both parties are incapable of giving consent to extended to third persons who are directly affected by the
a contract, the contract is not voidable but unenforceable contract.
(1403[3]).
(2) In either case, the contract may be ratified. Contracts Which are Void or Inexistent
(i) In a contract which is unenforceable because both (a) Illegal Contracts
parties are incapacitated, the ratification on the part of
Article 1409, NCC. The following contracts are inexistent and void Article 1345, NCC. Simulation of a contract may be absolute or
from the beginning: relative. The former takes place when the parties do not intend to be
(1) Those whose cause, object or purpose is contrary to law, bound at all; the latter, when the parties conceal their true agreement.
morals, good customs, public order or public policy;
(2) Those which are absolutely simulated or fictitious; Article 1346, NCC. An absolutely simulated or fictitious contract is
(3) Those whose cause or object did not exist at the time of the void. A relative simulation, when it does not prejudice a third person
transaction; and is not intended for any purpose contrary to law, morals, good
(4) Those whose object is outside the commerce of men; customs, public order or public policy binds the parties to their real
(5) Those which contemplate an impossible service; agreement.
(6) Those where the intention of the parties relative to the principal
object of the contract cannot be ascertained;  In relative simulation, parties conceal their true agreement.
(7) Those expressly prohibited or declared void by law.  In this kind of simulation, the essential requisites of a contract are
present and the simulation refers only to the content or terms of the
These contracts cannot be ratified. Neither can the right to set up the contract (Valerio).
defense of illegality be waived.  There are two juridical acts involved:
o the ostensible act and the hidden act.
 Those whose cause, object, or purpose is contrary to law, morals, o Ostensible act: contract the parties pretend to have executed
good customs, public order, or public policy (1409[1])—cause is o hidden act: is the true agreement between the parties.
ordinarily different from motive. (Villegas v. Rural Bank of Tanjay, Inc)
 As a rule, the motive or particular purpose of a party in entering into  A relative simulation binds the parties to their real agreement “when
a contract does not affect the validity nor existence of the contract. it does not prejudice a third person and is not intended for any
(PH National Construction v. CA) purpose contrary to law, morals, good customs, public order, or
public policy. (1346)
(1) Cause Distinguished from Motive: Cause is the essential
reason which moves the contracting parties to enter into it. In (c) Contracts Whose Cause or Object Did Not Exist
other words, the cause is the immediate, direct, and proximate  Those whose cause or object did not exist at the time of the
reason which justifies the creation of an obligation through the transaction (1409[3]).
will of the contracting parties (Uy v. CA). On the other hand, o Thus, a contract entered into upon future inheritance is void.
motive is the particular reason of a contracting party which (Arrogante)
does not affect the other party. o future inheritance as any property or right not in existence or
(2) When motive becomes cause: The motive may be regarded capable of determination at the time of the contract, that a
as causa when "it predetermines the purpose of the person may in the future acquire by succession (Blas v.
contract.” (Liguez v. CA) Santos).
(i) In other words, when the realization of such motive or  In a contract of lease, although the lessor need not be the owner
particular purpose has been made a condition upon of the property being leased, he should have a right (e.g., either as
which the contract is made to depend, then the motive a usufructuary or a lessee) or at least an authority (e.g., as an agent
becomes the cause. (PH National Construction Corp.) of the owner, usufructuary, or lessee) to lease it out; otherwise, the
(ii) When they blend to that degree, and the motive is contract is void because the cause or object did not exist at the time
unlawful, then the contract entered into is null and void of the transaction (Ballesteros v. Abion).
(Olegario v. CA). (d) Objects outside commerce of men
 Those whose object is outside the commerce of men (1409[4]).
(b) Absolutely Simulated Contract: Those which are absolutely
 Thus, the following things may not be the object of a contract
simulated or fictitious.
because they are not susceptible of appropriation, therefore,
outside the commerce of men:
(1) Concept
(1) Properties of public dominion are outside the commerce of
 In absolute simulation there appears to be a valid contract but men (MIAA v. CA).
there is actually none because the element of consent is lacking (i) They cannot be subject to sale, disposition, or
because the parties do not actually intend to be bound by the encumbrance; any sale, disposition, or encumbrance of
terms of the contract (Clemente v. CA). such property of the public dominion is void for being
o THUS: an absolutely simulated or fictitious contract is void, contrary to law and public policy (Navy Officers’ Village
and the parties may recover from each other what they Association, Inc. v. Republic).
may have given under the contract (Valerio v. Refresca). (ii) They cannot be leased or otherwise be the subject
 As a consequence, a contract of purchase and sale is null and void matter of contracts (Dacanay v. Asistio). Hence, the right
and produces no effect whatsoever where it appears that the same of the public to use public property may not be bargained
is without cause or consideration which should have been the away through contract.
motive thereof, or the purchase price which appears thereon as (iii) For example, public streets cannot be converted into flea
paid but which in fact has never been paid by the purchaser to the markets and leased to private individuals; the
vendor (Tanchuling v. Cantela). submerged lands in the Manila Bay area, which are
 The most protuberant index of absolute simulation of contract is the declared to be part of the State’s inalienable natural
complete absence of an attempt in any manner on the part of resources, cannot be alienated to a private entity
the ostensible buyer to assert rights of ownership over the (Chavez v. PEA); and properties officially declared
subject properties. (Ureta) military reservations become inalienable and outside the
commerce of men and may not be the subject of a
(2) Distinguished from Relative Simulation contract or of a compromise agreement (Republic v.
Bacas).
(2) Sacred things, common things like the air and the sea, and money agreed to be paid, or damages for its violation, and no
res nullius, as long as they have not been appropriated. affirmative relief will be given to one against the other.
(3) Rights which are intransmissible may not also be the object of (2) Each must bear the consequences of his own acts. They will
a contract because they are also considered outside the be left where they have placed themselves since they did not
commerce of men, such as: come into court with clean hands. (Bercero v. Capitol Dev.)
(i) purely personal rights, i.e., patria potestas or marital (c) EXC: the following exceptions that permit the return of that which
authority, the status and capacity of persons, and may have been given under a void contract to:
honorary titles and distinctions; and (1) the innocent party (Arts. 1411-1412);
(ii) public offices, inherent attributes of the public authority, (2) the debtor who pays usurious interest (Art. 1413);
and political rights of individuals, such as the right of (3) the party repudiating the void contract before the illegal
suffrage. purpose is accomplished or before damage is caused to
a third person and if public interest is subserved by allowing
(e) Contracts Involving Impossible Service recovery (1414);
Article 1348, NCC. Impossible things or services cannot be the (4) incapacitated party if the interest of justice so demands (1415)
object of contracts. (5) the party for whose protection the prohibition by law is
intended if the agreement is not illegal perse but merely
 Impossible things or services cannot be the object of contracts. prohibited and if public policy would be enhanced by
 The rule is based on the maxim impossibilium nulla obligatio est permitting recovery (1416); and
(There is no obligation to do impossible things). (6) the party for whose benefit the law has been intended such as
 An impossible service is that which is beyond the ordinary power in price ceiling laws (1417) and labor laws (1418-1419) (Hulst
of man or that which is against the law, morals, good customs, v. PR Builders).
public order, or public policy.
 The impossibility may either be Other Exceptions
o absolute, when nobody can perform it; or relative, when it  Another exception is where the application of the in pari delicto rule
cannot be performed because of the special conditions or would violate well-established public policy (Pajuyo v. CA).
qualifications of the obligor.  In Gonzalo v. Tarnate, Jr., the Court held that the principle of pari
 The absolute impossibility nullifies the contract. delicto cannot be applied if it would contravene the public
 As to relative impossibility, the effects shall depend on whether policy on prevention of unjust enrichment.
the same is temporary or permanent. o However, the recovery on the basis of unjust enrichment
o If temporary, it does not nullify the contract, such as when a cannot apply to a foreigner who acquired private lands in the
partner agrees to contribute to the partnership a sum more Philippines in violation of the Constitutional prohibition.
than what his means allow; (Frenzel v. Catio)
o if permanent, it nullifies the contract, such as blindness in a
contract which requires the use of eyesight. ARTICLE 1411. When the nullity proceeds from the illegality of the
cause or object of the contract, and the act constitutes a criminal
(f) Intention Cannot Be Ascertained offense, both parties being in pari delicto, they shall have no action
 Those where the intention of the parties relative to the principal against each other, and both shall be prosecuted. Moreover, the
object of the contract cannot be ascertained (1409[6]). provisions of the Penal Code relative to the disposal of effects or
 The rule is echoed in Article 1378, paragraph 2, which states: “if instruments of a crime shall be applicable to the things or the price of
the doubts upon the principal object of the contract in such a way the contract.
that it cannot be known what may have been the intention or will of
the parties, the contract shall be null and void." This rule shall be applicable when only one of the parties is guilty; but
the innocent one may claim what he has given, and shall not be
(g) Expressly Prohibited or Declared Void by Law bound to comply with his promise.
 An example of a contract expressly prohibited by law is any
ARTICLE 1412. If the act in which the unlawful or forbidden cause
stipulation which contravenes the prohibition against pactum
consists does not constitute a criminal offense, the following rules
commissorium. (2088, 2137)
shall be observed:
 Examples of contracts expressly declared void by law are those
(1) When the fault is on the part of both contracting parties, neither
contracts which failed to comply with the formalities required by law
may recover what he has given by virtue of the contract, or
for their validity, such as those mentioned in Articles 748, 749,
demand the performance of the other’s undertaking;
1773, 1744(1), 1874, 2134, and 2140 and Act No. 1147.
(2) When only one of the contracting parties is at fault, he cannot
recover what he has given by reason of the contract, or ask for
Principle of In Pari Delicto
the fulfillment of what has been promised him. The other, who
(a) Applicability: The principle applies only to contracts with an
is not at fault, may demand the return of what he has given
illegal cause, subject matter (Ureta), or purpose (Modina v. CA),
without any obligation to comply with his promise.
whether the attendant facts constitute an offense or misdemeanor
or whether the consideration involved is merely rendered illegal.
ARTICLE 1413. Interest paid in excess of the interest allowed by the
(1) It does not apply to inexistent contracts, or to fictitious or
usury laws may be recovered by the debtor, with interest thereon
simulated contracts.
from the date of the payment.
(b) Statement of the Rule: The principle of in pari delicto provides that
when two parties are equally at fault, the law leaves them as they
ARTICLE 1414. When money is paid or property delivered for an
are and denies recovery by either one of them (Yun Bun Guan).
illegal purpose, the contract may be repudiated by one of the parties
(1) No suit can be maintained for its specific performance, or to
before the purpose has been accomplished, or before any damage
recover the property agreed to be sold or delivered, or the
has been caused to a third person. In such case, the courts may, if
the public interest will thus be subserved, allow the party repudiating
the contract to recover the money or property.
ARTICLE 1415. Where one of the parties to an illegal contract is
incapable of giving consent, the courts may, if the interest of justice
so demands allow recovery of money or property delivered by the
incapacitated person.
ARTICLE 1416. When the agreement is not illegal per se but is

merely prohibited, and the prohibition by the law is designed for the
protection of the plaintiff, he may, if public policy is thereby enhanced,
recover what he has paid or delivered.
ARTICLE 1417. When the price of any article or commodity is

determined by statute, or by authority of law, any person paying any
amount in excess of the maximum price allowed may recover such
excess.
ARTICLE 1418. When the law fixes, or authorizes the fixing of the
maximum number of hours of labor, and a contract is entered into
whereby a laborer undertakes to work longer than the maximum thus
fixed, he may demand additional compensation for service rendered
beyond the time limit.
ARTICLE 1419. When the law sets, or authorizes the setting of a

minimum wage for laborers, and a contract is agreed upon by which
a laborer accepts a lower wage, he shall be entitled to recover the
deficiency.
BOOK V. - SPECIAL CONTRACTS  (b) if such intention does not clearly appear,
 the contract shall be considered a barter if the
PART 1: CONTRACT OF SALE value of the thing given exceeds the amount of
the money or its equivalent;
A. Concept  otherwise, it is sale. (1468)
 Practical effect of the distinction: If the contract is sale, it is covered
1. Basic Concepts by the Statute of Frauds; if barter, it is not covered by the Statute
of Frauds.
Essence of Contract
Article 1458, NCC. By the contract of sale one of the contracting Nature and Characteristics
parties obligates himself to transfer the ownership of and to deliver a (a) It is a consensual contract:
determinate thing, and the other to pay therefor a price certain in (1) From the point of view of perfection, the contract of sale is a
money or its equivalent. consensual contract—which means that the sale is perfected
by mere consent. (Dalion v. CA)
A contract of sale may be absolute or conditional. (2) The delivery of the thing bought or payment of the price
is not necessary for the perfection of the contract. (Balatbat
It is a contract involving the exchange of a thing or right in v. CA) Instead, upon perfection of the contract it creates an
consideration of the payment of a price certain in money or its obligation to make the delivery of the thing bought. (1458)
equivalent. The consideration for the delivery of a thing or right must be (b) It is not a mode, but only creates title: The contract of sale is not
payment of a price in money or the equivalent of money. a mode of transmitting ownership. Upon perfection, it does not
transfer or affect ownership. Instead, it only creates an obligation
Purpose: Onerous transmission of ownership over a property; or to transfer ownership or it only creates title. It is tradition or
onerous transmission of rights in relation to rights other than ownership. delivery, as a consequence of sale, that actually transfers
ownership. (San Lorenzo Dev. Corp. v. CA)
Donation is GRATUITOUS transfer of ownership or rights. Sale is (c) It creates reciprocal obligations: A contract of sale creates
ONEROUS. reciprocal obligations, where the seller obligates himself to transfer
the ownership of and deliver a determinate thing, and the buyer
Subject Matter: Tangible property or rights obligates himself to pay therefor a price certain in money or its
But in case of rights, the contract is usually denominated as “assignment equivalent. (Carrascoso, Jr. v. CA)
of right/credit.” Thus, such assignment can be a sale if it’s in (d) It is ordinarily commutative and onerous: Ordinarily, the contract
consideration of a payment of price certain in money/equivalent. of sale is commutative and onerous, in that each one of the
parties assume a correlative obligation—the seller to deliver
Consideration: price certain in money. and transfer ownership of the thing sold and the buyer to pay the
Thus the obligation of the buyer is to pay a sum of MONEY, governed price. (Gaite v. Fonacier) However, the contract may also
by Article 1249 CC. The concept of legal tender shall apply. become aleatory when the sale is subordinated to an uncertain
event, as in the case of a sale of hope or expectation, or emptio
ARTICLE 1249. The payment of debts in money shall be made in the spei.
currency stipulated, and if it is not possible to deliver such currency, (e) It is also a nominate and a principal contract.
then in the currency which is legal tender in the Philippines.
Two Kinds of Contracts of Sale
The delivery of promissory notes payable to order, or bills of (a) Absolute Sale: When the sale is devoid of any condition
exchange or other mercantile documents shall produce the effect of imposed on the passing of title of the thing to be conveyed or on
payment only when they have been cashed, or when through the fault the obligation of a party thereto (Romero v. CA) and, hence, title
of the creditor they have been impaired. to the property passes to the vendee upon delivery of the thing
sold; (Nabus v. Pacson)
In the meantime, the action derived from the original obligation shall (b) Conditional Sale: When the sale is subject to any condition
be held in abeyance. imposed on the passing of title of the thing to be conveyed or on
the obligation of a party thereto. (Romero v. CA)
Distinguished from Barter
Article 1638, NCC. By the contract of barter or exchange one of the Contract to Sell (CTS) Is Different from Conditional Contract of Sale
parties binds himself to give one thing in consideration of the other’s (CCS)
promise to give another thing. A contract to sell is not yet a contract of sale.
Definition of CTS: It is a bilateral contract whereby the prospective
Article 1468, NCC. If the consideration of the contract consists partly seller, while expressly reserving the ownership of the subject
in money, and partly in another thing, the transaction shall be property despite delivery thereof to the prospective buyer, binds
characterized by the manifest intention of the parties. If such intention himself to sell the subject property exclusively to the prospective
does not clearly appear, it shall be considered a barter if the value of buyer upon fulfillment of the condition agreed upon, such as the full
the thing given as a part of the consideration exceeds the amount of payment of the purchase price. (Roque v. Aguinaldo) Elsewise stated,
the money or its equivalent; otherwise, it is a sale. in a contract to sell, ownership is retained by the vendor and is not to
pass to the vendee until full payment of the purchase price.
 The contract of barter involves the exchange of a thing for
another thing. (1648) Distinction Between CTS and CCS: A contract to sell may not even be
o If the consideration for the delivery of a thing is partly in considered as a conditional contract of sale. (Coronel v. CA) While in
money and partly in another thing: both contracts, title to the property remains with the seller until the
 (a) the contract shall be characterized by the buyer fully pays the purchase price and both contracts are subject
manifest intention of the parties;
to such positive suspensive condition of the buyer’s full payment of o as to the buyer, the cause is the delivery of the thing sold;
the purchase price, they differ as follows: o as to the seller, it is the payment of the price in money or its
equivalent.
CCS CTS  In relation to price, the parties must not only agree on the
the buyer automatically transfer of title to the prospective amount of the price but also on the manner of payment
acquires title to the property buyer is not automatic because of the price to give rise to a perfected contract of sale.
upon full payment of the the prospective seller must  An agreement as to the manner of payment goes into the
purchase price and this transfer convey title to the property price, such that a disagreement on the manner of
of title is “by operation of law through a deed of absolute payment is tantamount to a failure to agree on the price.
without any further act having to sale. (Boston Bank of the PH v. Manalo)
be performed by the seller.”
(Olivarez Realty Corp. v. b. Subject Matter (Object)
Castillo) (a) General rule: Any thing that has a value that can be assessed
CC provisions on sales CC provisions on conditional in money, whether immovable or movable, consumable or non-
obligations consumable, corporeal or incorporeal, present or future, and even
a mere hope or expectancy, may be the object of sale.
 The distinction is important to determine the applicable laws and Tangible property or rights.
remedies in case a party does not fulfill his or her obligations under
the contract. (b) Requisites
 In a contract of conditional sale, our laws on sales under the CC Article 1459, NCC. The thing must be licit and the vendor must have
apply. Contracts to sell are not governed by our laws on sales but a right to transfer the ownership thereof at the time it is delivered.
by the CC provisions on conditional obligations.
Article 1460, NCC. A thing is determinate when it is particularly
Distinguishing Characteristic of CTS designated or physically segregated from all others of the same
 The stipulation to execute a deed of absolute sale upon full class.
payment of the purchase price, is a unique and distinguishing
characteristic of a contract to sell. (Diego v. Diego) The requisite that a thing be determinate is satisfied if at the time the
o Hence, where the seller promises to execute a deed of contract is entered into, the thing is capable of being made
absolute sale upon completion by the buyer of the payment of determinate without the necessity of a new or further agreement
the price, the contract is only a contract to sell, even if their between the parties.
agreement is denominated as a Deed of Conditional Sale
(Roque v. Aguando). Article 1461, NCC. Things having a potential existence may be the
 The agreement to execute a deed of sale upon full payment of the object of the contract of sale.
purchase price shows that the vendors reserved title to the
subject property until full payment of the purchase price. Prior to The efficacy of the sale of a mere hope or expectancy is deemed
the execution of the deed of absolute sale, the seller is not subject to the condition that the thing will come into existence.
obligated yet to transfer the ownership to the buyer, even if
there is a contract to sell between them. (Ursal v. CA) – THIS IS A The sale of a vain hope or expectancy is void.
CONTRACT TO SELL
o To be a conditional contract of sale: There must be a Article 1347, NCC. All things which are not outside the commerce of
stipulation that upon payment of full purchase price, there’s an men, including future things, may be the object of a contract. All rights
automatic transfer of ownership. which are not intransmissible may also be the object of contracts.
 Contract to Sell: the obligation of the seller is subject to the positive
suspensive condition to pay the full purchase price. Failure to pay No contract may be entered into upon future inheritance except in
means the obligation does not arise. There’s no need to rescind the cases expressly authorized by law.
contract. Rescission presupposes the obligation is already exists.
In a contract to sell, if the suspensive condition is not fulfilled, there All services which are not contrary to law, morals, good customs,
is no obligation yet on the part of the seller. This prevents the public order or public policy may likewise be the object of a contract.
obligation from coming into existence. 1191 does not apply in a
contract to sell. (1) the thing must be licit (1459);
o The seller can simply treat the contract as cancelled. But he (2) the thing may or may not be existing at the time of the perfection of
must at least notify the buyer of his intention to do so. There the contract, so long as it has the potential or possibility of
are generally no formalities, except if the transaction is existence at some future time (1461[1]) —the goods which form
covered by the Maceda Law. In which case, the cancellation the subject of a contract of sale may be either existing goods,
must be by way of a notarial act. owned or possessed by the seller, or goods to be manufactured,
raised, or acquired by the seller after the perfection of the contract
B. Essential Elements and Formalities of sale (1962[1]):
(a) emptio rei speratae – it is a sale of future things in which
1. Essential Elements the amount and the quality of the thing is uncertain and
the sale is subject to the condition that the thing should
a. Three Essential Elements come into existence, such that if the condition is not fulfilled
Being a consensual contract, it only requires three essential elements: or if the thing does not come into existence, the contract
(1) consent, becomes ineffective; or
(2) object, and (b) emptio spei – it is the sale of hope or expectancy which the
(3) cause. law allows, but the sale of a vain hope or expectancy is void
 With respect to cause: (1461[3]);
(3) the thing must be determinate (1458), that is, it is already the contract of sale is covered by Not covered
particularly designated or physically segregated from all others of the Statute of Frauds
the same class (1460 [1]); or at least determinable, that is, the
thing is capable of being made determinate without the necessity SALE – To give
of a new or further agreement between the parties (1460[2]).  Seller can be compelled to deliver the thing
Subject matter does not have to be existing at the time of perfection. It PIECE OF WORK – to DO
must have a POSSIBILITY or POTENTIAL of coming into existence. The  Specific performance is NOT an available remedy
law on sales follows Article 1347, which allows future things to be the
subject of contracts. (d) Requirement of Ownership:
(1) Ownership by the seller of the thing sold at the time of the
1409(3) - The following contracts are inexistent and void from the perfection of the contract of sale is not an element for its
beginning: (3) Those whose cause or object did not exist at the time of perfection and a perfected contract of sale cannot be challenged
the transaction; on the ground of non-ownership on the part of the seller at the time
 This refers to things that are impossible to exist, or those which of its perfection; hence, the sale is still valid. (Quijada v. CA)
have no potential of coming into existence. Thus, future things may (2) Instead, upon perfection of the contract, it will create an
be the object of sale. obligation on the part of the seller to transfer ownership to the
buyer (1458) —if the seller will not be able to do so, the same is
(c) Contract of Sale Distinguished from Contract for Piece of merely a breach of the contract of sale.
Work (3) If the seller is not the owner but he was able to deliver the thing
Since the contract of sale does not require the thing to be already in sold to the buyer, the latter does not acquire ownership
existence at the time its perfection, the contract may either be sale or because no one can give what one does not have—nemo dat
contract for piece of work if the subject matter is a thing still to be quod non habet. (Tangulin v. CA)
made: (a) Exception: when the sale of a person with a void title is to a
(1) Contract For Piece of Work: By the contract for a piece of work, third person who purchased it for value and in good faith.
the contractor binds himself to execute a piece of work for the (Modina v. CA)
employer, in consideration of a certain price or compensation.
The contractor may either employ only his labor or skill, or also  The following can be sold:
furnish the material. (1713) o GR: Inchoate interest can be sold
(2) Test in determining character of contract  EXC: 1347 – future inheritance
(a) if the parties intended that at some future date an object  EXC: Partition inter vivos of the inheritance by the
has to be delivered, without considering the work or labor of testator
the party bound to deliver, the contract is one of sale; but if o A hope
one of the parties accepts the undertaking on the basis of
some plan, taking into account the work he will employ Q. Can the reservatario already sell his interest while the reservista is
personally or through another, there is a contract for a piece still alive? The interest of the reservatario is conditional on the resolutory
of work; condition that the reservatario is still alive at the death of the reservista.
(b) if such intention is not clear but the one who committed to It can be sold, BUT IT IS SUBJECT TO THE SAME RESOLUTORY
deliver the thing is habitually engaged in the business of CONDITION. If at the death of the reservista, the reservatario is no
manufacturing or making such thing, the contract is one longer alive, the sale is INEFFECTIVE. The right of the reservista
of sale; however, if the one who committed to deliver the thing becomes absolute.
is not habitually engaged in the business of making such thing
and the same would never have existed except for the Sale by non-owner – not required for the perfection of a contract of sale.
order of the person desiring it, the contract is one for a Being a consensual contract, it’s perfected by mere consent. (Consent,
piece of work, not a sale. (Engineering & Machinery Corp v. object, cause)
CA)
Segura v. Segura: Seller was not the owner but was able to make the
The distinction comes in when the object still has to be made. delivery. The sale is void because the seller is not the owner so the buyer
Test: did not become the owner.
 Intention of the parties: What is important to the parties? Sir: The contract of sale is valid, because delivery is not a requirement.
o CONTRACT FOR PIECE OF WORK It creates an obligation to transfer ownership and deliver the object. This
 If SKILLS to be employed (your consideration is the delivery is to transfer ownership. Thus the one to deliver must have the
EXPERTISE) – ex. You hired specific designer right to transmit ownership. Failure to deliver will not render the contract
 If PLAN to be followed who will undertake to deliver the void. The validity of the contract is determined at the point of
thing. PERFECTION, not consummation. Failure to deliver is a BREACH of
o If intention is not clear contract, not invalidity of the contract. Thus, the sale was valid in the
 Habitually engaged in producing the thing – SALE contract. But although there was delivery, delivery presupposes that the
 Not ordinarily engaged in the producing the thing and will seller has the right to transmit ownership. Thus, the buyer did not
only make the thing pursuant to the special order of become the owner.
another person – contract for PIECE OF WORK
You cannot give what you do not have.
(3) Importance of Distinctions EXC: Buyer in good faith
Contract of Sale Contract for Piece of Work
The obligation created is an the obligation created in contract Nool v. CA – involved a foreclosed real estate property. The owner was
obligation to give. for piece of work is an obligation not able to redeem the property. By operation of law, ownership of the
to do property is transmitted to the buyer at the auction sale. After the
expiration of the redemption owner, the mortgagor sold the property to (a) if the price is simulated, the contract is void, but the act
a buyer with a right of repurchase. The seller failed to deliver the property may be shown to have been in reality a donation, or some
to the buyer because ownership was already with the bank. The buyer other act or contract (1471). Thus, a deed of sale, in which the
dealt directly with the bank and was able to acquire the property of the stated consideration had not in fact been paid, is null and
bank. The mortgagor-seller wanted to exercise his right of repurchase void. (Rongavilla v. CA)
under the contract of sale. Is the seller entitled to exercise the right of (b) On the other hand, if the price agreed upon is true, the
repurchase? NO, the sale is void. Ownership is not required to perfect a failure to pay the price does not affect the validity of the
contract of sale. The seller must transmit ownership at the time of contract but merely results in a right to demand the
delivery. If at the time of delivery, the seller is unable to do so because fulfillment or cancellation of the obligation under an existing
he remains not the owner of the property, the contract becomes void. valid contract (Buenaventura v. CA);
The contract of sale is analogous to a void contract under 1409(5) (2) The consideration must be in money or its equivalent (1458);
[Those which contemplate an impossible service;]. (3) The price must be certain:
(a) in order that the price may be considered certain, it shall be
Sir disagrees; validity should be determined at the point of perfection. sufficient that it be so with reference to another thing
 A contract of sale creates an obligation to give. If he cannot deliver certain, or that the determination thereof be left to the
the property, there will be a breach of contract, which entitles the judgment of a specified person or persons (1469[1]);
buyer to rescind the contract. (b) if such person or persons be unable or unwilling to fix the
 A right of repurchase presupposes that the property was purchased price, the contract shall be inefficacious, unless the parties
from the seller. In Nool, the property was PURCHASED FROM subsequently agree upon the price (1469[2]);
THE BANK, not the mortgagor. Thus, he was not entitled to (c) if the third person or persons acted in bad faith or by
exercise the right of repurchase. mistake, the courts may fix the price (1469[3]);
(d) where such third person or persons are prevented from
Ownership is not required for perfection. But ownership is necessary at fixing the price or terms by fault of the seller or buyer, the
the point of delivery. Failure to delivery is a mere breach that will entitle party not in fault may have such remedies against the
the buyer to rescind the contract and to damages. If the seller was able party in fault as are allowed the seller or the buyer, as the
to make the delivery, this will not make the buyer the owner, because case may be (1469[4]);
you cannot give what you do not have, UNLESS, the buyer was a (e) the fixing of the price can never be left to the discretion of
purchaser in good faith. one of the contracting parties; however, if the price fixed
by one of the parties is accepted by the other, the sale is
c. Consideration – Price perfected (1473); and
(f) where the price cannot be determined in any other manner,
(a) Requisites the contract is inefficacious. (1474)
Article 1469, NCC. In order that the price may be considered certain, True sale vs. Simulated contract of sale
it shall be sufficient that it be so with reference to another thing  The price in the contract is false because the contract is absolutely
certain, or that the determination thereof be left to the judgment of a simulated.
special person or persons.  If the price stated was true because the contract was true, even if
the price is NOT paid, this will not affect the validity of the contract.
Should such person or persons be unable or unwilling to fix it, the o The buyer is in BREACH of his obligation to pay the purchase
contract shall be inefficacious, unless the parties subsequently agree price.
upon the price. o Seller has the right to collect the price.
If the third person or persons acted in bad faith or by mistake, the (b) Effect of Gross Inadequacy of Price
courts may fix the price. Article 1470, NCC. Gross inadequacy of price does not affect a
contract of sale, except as it may indicate a defect in the consent, or
Where such third person or persons are prevented from fixing the that the parties really intended a donation or some other act or
price or terms by fault of the seller or the buyer, the party not in fault contract.
may have such remedies against the party in fault as are allowed the
seller or the buyer, as the case may be. It does not affect a contract of sale. However, it may indicate a defect
in the consent, or that the parties really intended a donation or some
Article 1471, NCC. If the price is simulated, the sale is void, but the other act or contract.
act may be shown to have been in reality a donation, or some other
act or contract. d. Consent – Perfection
Article 1473, NCC. The fixing of the price can never be left to the Article 1475, NCC. The contract of sale is perfected at the moment
discretion of one of the contracting parties. However, if the price fixed there is a meeting of minds upon the thing which is the object of the
by one of the parties is accepted by the other, the sale is perfected. contract and upon the price.
Article 1474, NCC. Where the price cannot be determined in From that moment, the parties may reciprocally demand
accordance with the preceding articles, or in any other manner, the performance, subject to the provisions of the law governing the form
contract is inefficacious. However, if the thing or any part thereof has of contracts.
been delivered to and appropriated by the buyer, he must pay a
reasonable price therefor. What is a reasonable price is a question of Article 1476[2], NCC. In the case of a sale by auction:
fact dependent on the circumstances of each particular case. (1) Where goods are put up for sale by auction in lots, each lot is
the subject of a separate contract of sale.
(1) The price must be real or true—
(2) A sale by auction is perfected when the auctioneer announces be substantially changed in character without the
its perfection by the fall of the hammer, or in other customary knowledge of the seller, the buyer may at his option treat
manner. Until such announcement is made, any bidder may the sale either as:
retract his bid; and the auctioneer may withdraw the goods from (i) avoided; or
the sale unless the auction has been announced to be without (ii) valid as to all of the existing goods or in so much
reserve. thereof as have not deteriorated, and as binding the
(3) A right to bid may be reserved expressly by or on behalf of the buyer to pay the agreed price for the goods in which the
seller, unless otherwise provided by law or by stipulation. ownership will pass, if the sale was divisible (1494).
(4) Where notice has not been given that a sale by auction is
subject to a right to bid on behalf of the seller, it shall not be e. Capacities of Parties:
lawful for the seller to bid himself or to employ or induce any
person to bid at such sale on his behalf or for the auctioneer, to Article 1489, NCC. All persons who are authorized in this Code to
employ or induce any person to bid at such sale on behalf of the obligate themselves, may enter into a contract of sale, saving the
seller or knowingly to take any bid from the seller or any person modifications contained in the following articles.
employed by him. Any sale contravening this rule may be
treated as fraudulent by the buyer. Where necessaries are sold and delivered to a minor or other person
without capacity to act, he must pay a reasonable price therefor.
Article 1482, NCC. Whenever earnest money is given in a contract Necessaries are those referred to in article 290.
of sale, it shall be considered as part of the price and as proof of the
perfection of the contract. Article 1490, NCC. The husband and the wife cannot sell property to
each other, except:
Article 1493, NCC. If at the time the contract of sale is perfected, the (1) When a separation of property was agreed upon in the marriage
thing which is the object of the contract has been entirely lost, the settlements; or temuim
contract shall be without any effect. (2) When there has been a judicial separation of property under
article 191.
But if the thing should have been lost in part only, the vendee may
choose between withdrawing from the contract and demanding the Article 1491, NCC. The following persons cannot acquire by
remaining part, paying its price in proportion to the total sum agreed purchase, even at a public or judicial auction, either in person or
upon. through the mediation of another:
(1) The guardian, the property of the person or persons who may
Article 1494, NCC. Where the parties purport a sale of specific be under his guardianship;
goods, and the goods without the knowledge of the seller have (2) Agents, the property whose administration or sale may have
perished in part or have wholly or in a material part so deteriorated in been intrusted to them, unless the consent of the principal has
quality as to be substantially changed in character, the buyer may at been given;
his option treat the sale: (3) Executors and administrators, the property of the estate under
(1) As avoided; or administration;
(2) As valid in all of the existing goods or in so much thereof as (4) Public officers and employees, the property of the State or of
have not deteriorated, and as binding the buyer to pay the any subdivision thereof, or of any government-owned or
agreed price for the goods in which the ownership will pass, if controlled corporation, or institution, the administration of which
the sale was divisible. has been intrusted to them; this provision shall apply to judges
and government experts who, in any manner whatsoever, take
(a) Consensual contract: A contract of sale is a consensual contract, part in the sale;
which means that the sale is perfected by mere consent (Dalion (5) Justices, judges, prosecuting attorneys, clerks of superior and
v. CA) or is perfected at the moment there is a meeting of minds inferior courts, and other officers and employees connected with
upon the thing which is the object of the contract and upon the price the administration of justice, the property and rights in litigation
(1475[1]; Balatbat v. CA). or levied upon an execution before the court within whose
(b) Sale by Auction: A sale by auction is perfected when the jurisdiction or territory they exercise their respective functions;
auctioneer announces its perfection by the fall of the hammer, this prohibition includes the act of acquiring by assignment and
or in other customary manner. Until such announcement is made, shall apply to lawyers, with respect to the property and rights
any bidder may retract his bid; and the auctioneer may withdraw which may be the object of any litigation in which they may take
the goods from the sale unless the auction has been announced to part by virtue of their profession;
be without reserve (1476[2]). (6) Any others specially disqualified by law.
(c) Effect of Earnest Money: Whenever earnest money is given in a
contract of sale it shall be considered as part of the price and as If one party is incapacitated – voidable
proof of the perfection of the contract (1482). However, Article If both are incapacitated – unenforceable
1482 speaks of earnest money given in a contract of sale. The
earnest money forms part of the consideration only if the sale If the parties are ESPECIALLY DISQUALIFIED - VAI
is consummated upon full payment of the purchase price. If the
earnest money is given in a contract to sell, Article 1482, which (a) General Requirement: Same as ordinary contracts (1489).
speaks of a contract of sale, does not apply. (Serrano v. (b) Prohibited Sales – VAI
Caguiat)
(d) Effect of Loss of Thing Prior to Perfection:
(1) For things other than “goods,” the contract is without any
effect (1493) —it is a case of an inexistent contract; and
(2) In case of “specific goods,” if they perished in part or have
wholly or in a material part so deteriorated in quality as to
Article 1403, NCC. The following contracts are unenforceable,

unless they are ratified:
(1) Those entered into in the name of another person by one who
has been given no authority or legal representation, or who has
acted beyond his powers;
(2) Those that do not comply with the Statute of Frauds as set forth
in this number. In the following cases an agreement hereafter
made shall be unenforceable by action, unless the same, or
some note or memorandum, thereof, be in writing, and
subscribed by the party charged, or by his agent; evidence,
therefore, of the agreement cannot be received without the
(1) between husband and wife, unless their property regime is writing, or a secondary evidence of its contents:
complete separation (1490) —but only the heirs and the (a) An agreement that by its terms is not to be performed
creditors can question its nullity and not the spouses within a year from the making thereof;
themselves who executed the contract with full knowledge of the (b) A special promise to answer for the debt, default, or
prohibition (Modina v. CA); miscarriage of another;
o They are only allowed to sell to each other if there is complete (c) An agreement made in consideration of marriage, other
separation of property. than a mutual promise to marry;
o Does not include exclusive properties. (d) An agreement for the sale of goods, chattels or things in
o BUT only their heirs and creditors have the personality to action, at a price not less than five hundred pesos, unless
question the sale. the buyer accept and receive part of such goods and
(2) the prohibition also applies to common-law relationships chattels, or the evidences, or some of them, of such things
because of policy considerations and the dictates of morality (Cruz in action, or pay at the time some part of the purchase
v. CA); otherwise, the condition of those who incurred guilt would money; but when a sale is made by auction and entry is
turn out to be better than those in legal union (Calimlim-Canullas v. made by the auctioneer in his sales book, at the time of the
Fortun); sale, of the amount and kind of property sold, terms of sale,
(3) the guardian cannot acquire by purchase, even at a public auction price, names of the purchasers and person on whose
or judicial auction, either in person or through the mediation of account the sale is made, it is a sufficient memorandum;
another, the property of the ward under his guardianship (e) An agreement for the leasing for a longer period than one
(1491[1]), so long as the guardianship still exists (Rubias v. year, or for the sale of real property or of an interest therein;
Batiller); (f) A representation as to the credit of a third person.
(4) the agent cannot acquire by purchase, even at a public auction or (3) Those where both parties are incapable of giving consent to a
judicial auction, either in person or through the mediation of contract.
another, the property of the principal whose administration or
sale may have been entrusted to him (1491[2]), unless the
Article 1406, NCC. When a contract is enforceable under the Statute
principal expressly consents to such sale (Distajo v. CA);
of Frauds, and a public document is necessary for its registration in
(5) the executor or administrator cannot acquire by purchase, even
the Registry of Deeds, the parties may avail themselves of the right
at a public auction or judicial auction, either in person or through
under Article 1357.
the mediation of another, the property of the estate under his
administration (1491[3]), so long as there is no final settlement yet
Article 1357, NCC. If the law requires a document or other special
of the estate (Rubias);
form, as in the acts and contracts enumerated in the following article,
o attaches only during settlement proceedings
the contracting parties may compel each other to observe that form,
(6) public officers and employees cannot acquire by purchase, even
once the contract has been perfected. This right may be exercised
at a public auction or judicial auction, either in person or through
simultaneously with the action upon the contract.
the mediation of another, the property of the State or of any
subdivision thereof or of any government-owned or controlled
Article 1874, NCC. When a sale of a piece of land or any interest
corporation or institution, the administration of which has been
therein is through an agent, the authority of the latter shall be in
entrusted to them (1491[4]); and
writing; otherwise, the sale shall be void.
(7) justices, judges, prosecuting attorneys, and clerks of superior
and inferior courts, and other officers and employees
GR: There are no formalities required in a contract of sale.
connected with the administration of justice, including
(a) Requirement as to Validity: Whatever may be its subject matter,
attorneys or lawyers, cannot acquire by purchase, even at a public
no particular form is required in a contract of sale for its validity
auction or judicial auction, either in person or through the mediation
(Dalion). The only exception is the sale of large cattle (1581)
of another, the property and rights in litigation or levied upon
which requires that the same be recorded with the city/ municipal
an execution before the court within whose jurisdiction or territory
treasurer and that a certificate of transfer be issued; otherwise, the
they exercise their respective jurisdiction (1491[5]).
sale is not valid (Act 1147 / Cattle Registration Act). Thus, an oral
sale of a parcel of land is a valid contract.
In all the foregoing contracts, the sale is void (Rubias).
(b) Requirement As to Enforceability: The sale of personal
 The ratification in Rubias: if the prohibition no longer attaches
property at a price not less than (1403[2d]) P500 and the sale
(when the relationship ends), they can enter into a new contract.
of real property (1403[2e]) must be in writing under the Statute
That is not a ratification. It does not retroact.
of Frauds; otherwise, the contract is unenforceable (1403[2]).
 This also attaches to contracts of lease.
o SOF is a matter of defense. If it’s not invoked at a proper time
during the presentation of oral evidence, that it is deemed a
f. Formalities in Contracts of Sale
waiver of the defense—it’s a ratification of the contract.
o SOF is only applicable to a PURELY EXECUTORY contract
(no performance on other side, even if partial). Otherwise, the
SOF is no longer applicable because the purpose of the SOF

is to prevent, and not perpetuate, fraud. Thus, if there’s an 1. Obligations of Seller
acceptance of the benefits of the contract, that’s a waiver of
the defense and is a ratification of the contract. Article 1495, NCC. The vendor is bound to transfer the ownership of
o Under 1406, for contracts under the SOF but are now and deliver, as well as warrant the thing which is the object of the
enforceable, the parties can avail of the remedy under 1357. sale.
 If a sale of parcel of land was done orally, but if the
defense of the SOF is no longer available, because the Article 1547, NCC. In a contract of sale, unless a contrary intention
contract is no longer purely executory, or because there appears, there is:
was a partial performance, the parties can avail of the (1) An implied warranty on the part of the seller that he has a right
remedy under 1406 to compel the other to reduce the to sell the thing at the time when the ownership is to pass, and
contract into a public instrument and compel registration. that the buyer shall from that time have and enjoy the legal and
o Under 1357, or contracts required to be in a public instrument peaceful possession of the thing;
under 1358, the parties are given the remedy to compel each (2) An implied warranty that the thing shall be free from any hidden
other to comply with the form or reduce it into a public faults or defects, or any charge or encumbrance not declared or
instrument. known to the buyer.
 REQUIREMENTS This article shall not, however, be held to render liable a sheriff,
 The contract must be perfected auctioneer, mortgagee, pledgee, or other person professing to sell by
 The contract must be valid as to form. virtue of authority in fact or law, for the sale of a thing in which a third
o If the contract is void as to form, 1357 is person has a legal or equitable interest.
unavailable.
 The contract is enforceable as to form, a. In General
o Thus if the contract is unenforceable as to the
SOF, 1357 is unavailable to make the contract (1) to deliver the thing sold;
enforceable. (2) to transfer ownership over the thing sold (1458, 1495); and
o Ex. Oral sale of land with acceptance of down payment. (3) to warrant the following:
(c) Sale of Land Need Not Be in Public Document and Be (a) that he has the right to sell the thing at the time when the
Recorded: It is not a requirement for the validity of a contract ownership is to pass (warranty of ownership);
of sale of a parcel of land that this be embodied in a public (b) that the buyer shall enjoy the legal and peaceful possession
instrument (Agasen v. CA). Thus, the non-appearance of the of the thing (warranty against eviction); and
parties before the notary public who notarized the deed does not (c) that the thing sold is free from any hidden faults or defects
necessarily nullify nor render the parties’ transaction void ab initio (warranty against hidden defects) (1495; 1547)
(Peñalosa v. Santos). Likewise, the non-recording of the
instrument in the registry of property does not affect the b. Obligation to Deliver and Transfer Ownership
validity of the contract (Fule v. CA).
(d) Remedy under Article 1357: If the sale of a parcel of land is (a) Sale Not a Mode but Merely Title
already enforceable under the Statute of Frauds, either because  The obligations of the seller to deliver and to transfer ownership are
the sale is in a private instrument (Dalion) or there has already been intertwined. In sales, the purpose of delivery is not only to
partial performance of the contract (Vda. De Jomoc v. CA), and a transfer possession but precisely to transfer ownership to the
public document is necessary for the registration in the buyer. As previously discussed, sale is not a mode, but merely
registry of deeds, the parties may avail themselves of the right a title (San Lorenzo Development Corp. v. CA).
granted under Article 1357 CC (1406).  Therefore, sale by itself does not transfer or affect ownership;
(e) Requirement of Form in Agency to Sell Land: When the sale of the most that sale does is to create the obligation to transfer
a piece of land or any interest thereon is through an agent, the ownership. It is tradition or delivery, as a consequence of sale, that
authority of the latter shall be in writing; otherwise, the sale shall actually transfers ownership, unless the sale is conditional.
be void (1874). Title provides a means for the transmission of ownership. It’s
preparatory to delivery (tradition), which will transfer ownership.
Preparatory Contracts
[1] Agency to Sell [1874] In a contract of sale, the transfer of possession is for the purpose of
 No form required transmitting ownership. There must be an INTENTION to do so.
 Unless if it’s for the sale of real estate (SPA)
 Ex. Case of delos Reyes (b) When to Deliver
[2] Right of First Refusal
 A verbal grant of RFR is VALID and ENFORCEABLE. Article 1524, NCC. The vendor shall not be bound to deliver the thing
 It’s not covered by the SOF. Prior to the exercise of the rights, there sold, if the vendee has not paid him the price, or if no period for the
is yet no sale. What the SOF is covered is SALE, not the right of payment has been fixed in the contract.
first refusal.
[3] Option Contract  GR: In reciprocal obligations, as in a contract of sale, the
 No form fulfillment of the parties’ respective obligations should be
 BUT it must be supported by a consideration distinct and separate simultaneous (Solar Harvest Incorporated v. Davao Corrugated
from the consideration in the sale. The consideration in the contract Carton Corp.). Thus, the vendor is not bound to deliver the thing
of option MUST BE PROVEN. The presumption that a sold, if the vendee has not paid him the price, or if no period for the
consideration is given is NOT applicable, payment has been fixed in the contract (1524).
 EXC: Where a period for the payment of the price has been
fixed in the contract, the vendor is already bound to deliver the
C. Obligations of the Parties
thing sold, although the period has not elapsed or, vendee shall now hold the thing as its owner amounts to
consequently, although he has not collected the price. delivery; and
(d) traditio constitution possessorium – the vendor
(c) Forms of Delivery continues to be in possession of the thing but in some
(1) Actual delivery other capacity and no longer as an owner, as when he, for
(a) in the case of a movable thing, it consists in actually handing example, possesses the thing as a lessee or a mere
it over to another; or usufructuary,
(b) in the case of immovables, it consists of material and (d) Intention to Deliver Important: In all forms of delivery, it is
possessory acts done by the vendee in the presence of and necessary that the act of delivery, whether constructive or actual,
with the consent of the vendor. should be coupled with the intention of delivering the thing.
(2) Constructive Delivery Without that intention, there is no tradition (Union Motor Corp. v.
CA).
Article 1498, NCC. When the sale is made through a public (e) Delivery “On Sale or Return”: When goods are delivered to the
instrument, the execution thereof shall be equivalent to the delivery buyer “on sale or return” to give the buyer an option to return the
of the thing which is the object of the contract, if from the deed the goods instead of paying the price, the ownership passes to the
contrary does not appear or cannot clearly be inferred. buyer on delivery but he may re-vest the ownership in the
seller by returning or tendering the goods within the time fixed
With regard to movable property, its delivery may also be made by in the contract, or, if no time has been fixed, within a reasonable
the delivery of the keys of the place or depository where it is stored time (1502[1]).
or kept. (f) Sales on approved or on trial or on satisfaction: When goods
are delivered to the buyer on approval or on trial or on
Article 1499, NCC. The delivery of movable property may likewise satisfaction, or other similar terms, the ownership does not pass
be made by the mere consent or agreement of the contracting to the buyer upon delivery. Instead, the ownership shall only
parties, if the thing sold cannot be transferred to the possession of pass:
the vendee at the time of the sale, or if the latter already had it in his (1) when the buyer signifies his approval or acceptance to the
possession for any other reason. seller or does any other act adopting the transaction; or
(2) if he does not signify his approval or acceptance to the seller,
Article 1502, NCC. When goods are delivered to the buyer “on sale but retains the goods without giving notice of rejection,
or return” to give the buyer an option to return the goods instead of then if a time has been fixed for the return of the goods, on
paying the price, the ownership passes to the buyer on delivery, but the expiration of such time, and, if no time has been fixed, on
he may revest the ownership in the seller by returning or tendering the expiration of a reasonable time (1502[2]).
the goods within the time fixed in the contract, or, if no time has been
fixed, within a reasonable time. (n) c. Double Sale
When goods are delivered to the buyer on approval or on trial or on (a) Requisites
satisfaction, or other similar terms, the ownership therein passes to (1) the two (or more) sales transactions must pertain to exactly the
the buyer: same subject matter;
(1) When he signifies his approval or acceptance to the seller or (2) the two (or more) sales transactions must constitute valid sales;
does any other act adopting the transaction; (3) the two (or more) buyers at odds over the rightful ownership of
(2) If he does not signify his approval or acceptance to the seller, the subject matter must each represent conflicting interests;
but retains the goods without giving notice of rejection, then if a (4) the two (or more) buyers at odds over the rightful ownership of the
time has been fixed for the return of the goods, on the expiration subject matter must each have bought from the very same seller
of such time, and, if no time has been fixed, on the expiration of (Cheng v. Genato) —
a reasonable time. What is a reasonable time is a question of (a) the conveyance must have been made by a party who has
fact. an existing right in the thing and the power to dispose of
it (Consolidated Rural Bank Inc. v. CA);
(a) traditio simbolica (symbolic delivery) – such as the delivery (b) it cannot be invoked where the two different contracts of
of movable property may be made by the delivery of the keys sale are made by two different persons, one of them not
of the place or depository where it is stored or kept (1498[2]), being the owner of the property sold or, even if the sale
or the delivery of a negotiable document of title (Pacific was made by the same person, if the second sale was
Commercial Co. v. Yatco), or the execution of a public made when such person was no longer the owner of the
instrument (1498[1]); in the case of the latter, however, there property, because it had been acquired by the first purchaser
is no transfer of ownership notwithstanding the in full dominion, the second purchaser cannot acquire any
execution of a public instrument when the instrument right, in which case the non-owner cannot validly sell (Salera
itself expresses or implies that it was not the intention of v. Rodaje); and
the parties to effect delivery or when there is an impediment (5) both sales must be contracts of sale —if one of the two
that may prevent the passing of the property from the hands contracts is a contract to sell, there is no double sale because
of the vendor to the vendee, as when a third person was in a contract to sell, there being no previous sale of the
actually in possession of the thing and objecting thereto property, a third person buying such property despite the
(Equatorial Realty Dev., Inc. v. Mayfair Theater, Inc.); fulfillment of the suspensive condition such as the full
(b) traditio longa manti – delivery is effected by the vendor by payment of the purchase price, for instance, cannot be
simply pointing to the vendee the thing to be transferred deemed a buyer in bad faith and the prospective buyer cannot
and which at that time must be within sight (1499); seek the relief of reconveyance of the property. Title to the
(c) traditio brevi manti – the vendee already had the thing in property will transfer to the buyer (third person) after registration
his possession for any other reason or by reason of another because there is no defect in the owner-seller’s title per se, but the
distinct title and the mere agreement of the parties that the
latter, of course, may be sued for damages by the prospective steps into the shoes of the judgment debtor, and merely
buyer in the contract to sell (Coronel v. CA). acquires the latter’s interest in the property sold as of the time
the property was levied upon (Carumba v. CA).
if the seller was no longer the owner at the time of the second sale, (a) Prior right
double sale will not arise because the seller cannot give what he doesn’t
have. d. Warranties
(b) Rules on Double Sale (a) Requisites of Express Warranty

Article 1544, NCC. If the same thing should have been sold to Article 1546, NCC. Any affirmation of fact or any promise by the
different vendees, the ownership shall be transferred to the person seller relating to the thing is an express warranty if the natural
who may have first taken possession thereof in good faith, if it should tendency of such affirmation or promise is to induce the buyer to
be movable property. purchase the same, and if the buyer purchases the thing relying
thereon. No affirmation of the value of the thing, nor any statement
Should it be immovable property, the ownership shall belong to the purporting to be a statement of the seller’s opinion only, shall be
person acquiring it who in good faith first recorded it in the Registry construed as a warranty, unless the seller made such affirmation or
of Property. statement as an expert and it was relied upon by the buyer.
Should there be no inscription, the ownership shall pertain to the (1) it consists of an affirmation of fact or any promise by the
person who in good faith was first in the possession; and, in the seller relating to the thing;
absence thereof, to the person who presents the oldest title, provided (2) the natural tendency of such affirmation or promise is to
there is good faith. induce the buyer to purchase the thing; and
(3) the buyer purchases the thing relying upon such
In double sale, there is a question of preference. affirmation or promise. (1546)
GR: 1st buyer is the preferred buyer
EXC: 2nd buyer complies with 1544. (b) Three Implied Warranties
Article 1547, NCC. In a contract of sale, unless a contrary intention
(1) in case of movable property, the ownership shall be transferred appears, there is:
to the person who may have first taken possession thereof in (1) An implied warranty on the part of the seller that he has a right
good faith, if it should be movable property (1544[1]); to sell the thing at the time when the ownership is to pass, and
(2) in case of immovable property, the ownership shall belong to the that the buyer shall from that time have and enjoy the legal and
person acquiring it who in good faith first recorded it in the peaceful possession of the thing;
Registry of Property. (2) An implied warranty that the thing shall be free from any hidden
 Should there be no inscription, the ownership shall pertain to faults or defects, or any charge or encumbrance not declared or
the person who in good faith was first in possession; known to the buyer.
 and, in the absence thereof, to the person who presents the
oldest title, provided there is good faith (1544[2, 3]). This article shall not, however, be held to render liable a sheriff,
 The law on double sale presumes title or ownership to pass to the auctioneer, mortgagee, pledgee, or other person professing to sell by
first buyer, unless the second buyer is able to successfully displace virtue of authority in fact or law, for the sale of a thing in which a third
the first buyer by doing the foregoing acts enumerated in Article person has a legal or equitable interest.
1544 (Coronel).
o In other words, Article 1544 requires the second buyer to (1) warranty of ownership;
acquire the immovable in good faith and to register it in good (2) warranty against eviction; and
faith (Abrigo v. De Vera). (3) warranty against hidden defects. (1547)
o Knowledge gained by the second buyer of the first sale
defeats his rights even if he is first to register the second (c) Requisites for Recovery for Breach of Warranty Against
sale, since such knowledge taints his prior registration with Eviction
bad faith (Cruz v. Cabana). Article 1548, NCC. Eviction shall take place whenever by a final
o On the other hand, knowledge gained by the first buyer of judgment based on a right prior to the sale or an act imputable to the
the second sale cannot defeat the first buyer’s rights vendor, the vendee is deprived of the whole or of a part of the thing
 except only as provided by the CC and that is where the purchased.
second buyer first registers in good faith the second
sale ahead of the first. The vendor shall answer for the eviction even though nothing has
 Such knowledge of the first buyer does not bar her from been said in the contract on the subject.
availing of her rights under the law, among them, to
register first her purchase as against the second buyer. The contracting parties, however, may increase, diminish, or
suppress this legal obligation of the vendor.
(c) Effect of Registration of Land Subject Matter of Double Sale
(1) If land is registered under the Torrens System, the law on double Article 1557, NCC. The warranty cannot be enforced until a final
sale under Article 1544 applies (Abrigo v. De Vera); judgment has been rendered, whereby the vendee loses the thing
(2) If the land is unregistered and the first sale was made by the acquired or a part thereof.
original owners but unrecorded while the second was an
execution sale that resulted from a complaint for a sum of money Article 1558, NCC. The vendor shall not be obliged to make good
filed against the said original owners and registered under Act No. the proper warranty, unless he is summoned in the suit for eviction at
3344, the law on double sale under Article 1544 cannot be the instance of the vendee.
invoked to benefit the purchaser at the execution sale. Instead,
the purchaser of unregistered land at a sheriff’s execution sale only
(1) the purchaser has been deprived of the whole or part of the thing  Recoupment (reconvention) is the act of rebating or recouping a
sold; part of a claim upon which one is sued by means of a legal or
(2) the eviction is by a final judgment; equitable right resulting from a counterclaim arising out of the
(3) the basis thereof is by virtue of a right prior to the sale made by same transaction. It is the setting up of a demand arising from
the vendor; and the same transaction as the plaintiff’s claim to abate or reduce
(4) the vendor has been summoned and made co-defendant in the that claim (First United Construction Corp. v. Bayanihan
suit for eviction at the instance of the vendee. Automotive Corp.).
(1548, 1557, 1558; Ang v. CA; Power Comm. and Industrial Cor. v. CA) o The legal basis for recoupment by the buyer is Article 1599
para 1 CC: ‘‘Article 1599. Where there is a breach of warranty
(d) Warranty Against Hidden Defects by the seller, the buyer may, at his election: (1) Accept or keep
the goods and set up against the seller, the breach of warranty
(1) Nature of Defects by way of recoupment in diminution or extinction of the price;
Article 1561, NCC. The vendor shall be responsible for warranty xxx ”
against the hidden defects which the thing sold may have, should o Hence, when the seller files an action for collection of the
they render it unfit for the use for which it is intended, or should they purchase price, the buyer may set up the seller’s breach
diminish its fitness for such use to such an extent that, had the of warranty by way of recoupment or counter-claim. It is
vendee been aware thereof, he would not have acquired it or would necessary, however, that the recoupment must arise out of
have given a lower price for it; but said vendor shall not be the contract or transaction upon which the plaintiff’s claim is
answerable for patent defects or those which may be visible, or for founded. In other words, the subject matter of the breach of
those which are not visible if the vendee is an expert who, by reason warranty must be the same subject matter in the seller’s
of his trade or profession, should have known them. action for recovery of the price.
 Court may order offsetting (recoupment)
 it must be hidden, hence, the vendor shall not be answerable for
patent defects or those which may be visible, or for those which 2. Obligations of Buyer
are not visible if the vendee is an expert who, by reason of his
trade or profession, should have known them (1561); and Distinguished from Agency to Sell
 such defects have rendered the thing unfit for the use for which  The obligation of the buyer is to pay a price certain in money or
it is intended, or have diminished its fitness for such use to such its equivalent (1458). Hence, the contract of sale must be
an extent that, had the vendee been aware thereof, he would distinguished from a mere agency to sell.
not have acquired it or would have given a lower price for it. o In the former, there is an obligation to pay the purchase price;
while in the latter (Quiroga v. Parsons), the agent receives
(2) Alternative Remedies for Breach of Warranty Against the thing to sell it, and does not pay its price, but delivers
Hidden Defects: to the principal the price he obtains from the sale of the
 actio redhibitoria – this is an action for the recovery of the thing to a third person, and if he does not succeed in selling
purchase price, with interest, accompanied with a return of the it, he returns it.
thing sold; or  The test in determining one from another is the degree of control
o Simply an action for rescission. It just has a special name in exercised over the thing delivered by the one who delivered it.
relation to hidden defects. o If the delivery puts the transferee in the attitude or
o It requires mutual restitution. position of an owner, and not merely as an agent who must
 actio estimatoria or quanti minoris – this is an action for the account for the proceeds of a resale, the transaction is a
recovery of a part of the price in proportion to the defects in sale;
quality of the thing sold, or an action for the proportionate  If the person who made the delivery (principal) still
reduction of the purchase price. exercises control over the thing – Agency
o If the price is unpaid – reduction  Otherwise – sale
o while the essence of an agency to sell is the delivery to an
(e) Prescriptive Period agent, not as his property, but as the property of the
Article 1571, NCC. Actions arising from the provisions of the principal, who remains the owner and has the right to control
preceding ten articles shall be barred after six months, from the sales, fix the price and terms, demand, and receive the
delivery of the thing sold. proceeds less the agent’s commission upon sales made (Kerr
& Co., Ltd. v. Lingad).
Article 1548, NCC. Eviction shall take place whenever by a final
judgment based on a right prior to the sale or an act imputable to the Consequences
vendor, the vendee is deprived of the whole or of a part of the thing  Contract of Sale – creates an obligation on the part of the buyer to
purchased. pay the purchase price
 Agency to Sell – agency does not have to pay the purchase price;
The vendor shall answer for the eviction even though nothing has he only needs to sell, or return the thing to the principal
been said in the contract on the subject.
Rights Granted to Buyer in Relation to Payment of Price
The contracting parties, however, may increase, diminish, or
suppress this legal obligation of the vendor. (a) Right to Suspend Payment
Article 1590, NCC. Should the vendee be disturbed in the
Actions based on breach of implied warranty against hidden defects possession or ownership of the thing acquired, or should he have
(1571) or warranty against eviction (1548) prescribe within six reasonable grounds to fear such disturbance, by a vindicatory action
months from the date of delivery of the thing sold. (Ang v. CA) or a foreclosure of mortgage, he may suspend the payment of the
price until the vendor has caused the disturbance or danger to cease,
(f) Principle of Recoupment unless the latter gives security for the return of the price in a proper
case, or it has been stipulated that, notwithstanding any such

contingency, the vendee shall be bound to make the payment. A
mere act of trespass shall not authorize the suspension of the
payment of the price.
(1) Rules Applicable to All Kinds of Contracts of Sale
 Should the vendee be disturbed in the possession or

ownership of the thing acquired, or should he have reasonable
grounds to fear such disturbance, by a vindicatory action or a
foreclosure of mortgage, he may suspend the payment of the
price until the vendor has caused the disturbance or danger
to cease (1590)
The requirement of cancellation by a notarial act does not apply to
 EXC: There is no right to suspend payment
industrial and industrial lots. But if the transaction is covered by the
o when the vendor gives security for the return of the price in a
Maceda Law, the rescission or cancellation must be by way of a notarial
proper case;
act.
o when it has been stipulated that, notwithstanding any such
contingency, the vendee shall be bound to make the payment;
Cancellation/Rescission by Notarial Act: peculiar technical
and
requirements.
o a mere act of trespass shall not authorize the suspension of
 THUS, the act of converting a private act of cancellation/rescission
the payment of the price, because in the latter case the
into a public document, must be an ACKNOWLEDGEMENT, not a
vendee can easily resort to an action for ejectment.
mere jurat.
(2) Rules Applicable in Sale of Subdivision Lots or

Condominium Units
In case of failure of the owner or developer to develop the

subdivision or condominium project according to the approved
plans and within the time limit for complying the same, the buyer may
exercise the following alternative remedies:
(1) he may suspend payment and wait for further development; or
(2) he may demand reimbursement of the total amount paid. (Sec.
23, PD 957)
Right of Buyer Who Paid Less Than Two Years of Installments:
 In case of the first option, the owner/developer may not forfeit
 He is entitled to a grace period of 60 days from the date the
the installment payments made by the buyer and the buyer
installments became due. (Sec. 4(1), RA 6552, Maceda Law)
may not be ousted from the subdivision. (Relucio v. Brillante-
 Within said period, the buyer may still update the payment
Garfin)
without the obligation to pay interest and penalties.
 In case of the second option, the notice informing the developer
 The seller may cancel the contract only after the expiration of the
of the intention not to remit further payments on account of non-
grace period but the notice of cancellation must be by way of a
development of the subdivision, and the-demand for refund, can be
notarial act.
made at the same time. (Casa Filipina Realty Corp. v. Office of the
 The cancellation becomes effective 30 days from receipt of such
President)
notice of cancellation.
(b) Right to Grace Period
Right of Buyer Who Paid At Least Two Years Installments:
(1) If Granted by Contract: When a grace period is provided for in the
 He is entitled to a grace period of one month for every one year
contract of sale, the same is a right, not an obligation of the debtor,
of installment payments paid.
and when unconditionally conferred, the grace period is
 This right shall be exercised by the buyer only once in every five
effective without further need of demand either calling for the
years of the life of the contract and its extensions, if any (Sec.
payment of the obligation or for honoring the right. (Bricktown Dev.
3[a] RA 6552).
Corp. v. Amor Tierra Dev. Corp.)
(2) In Sale of Realty by Installments (Maceda Law); Applicability:  The seller may cancel the contract only after the grace period but
(a) Applicable to sale of real property by installments must comply with two mandatory requirements:
o (1) to send a notarized notice of cancellation to the buyer
(b) except:
(i) sale of industrial lots; and
o (2) to refund the cash surrender value (Communities
(ii) sale of commercial buildings; and
(iii) sale to tenants. Cagayan, Inc. v. Nanol).
 Until and unless the seller complies with these twin mandatory
requirements, the contract to sell between the parties remains valid
and subsisting.
o Thus, the buyer has the right to continue occupying the
property subject of the contract to sell, and may “still reinstate
the contract by updating the account during the grace period
and before the actual cancellation” of the contract.
 The “cash surrender value” is at least 50% of the total
payments, but after five years of installments, an additional 5%
every year but not to exceed 90% of the total payments made.
The rescission, in this case, shall only take place at the will of the
vendee, when the inferior value of the thing sold exceeds one-tenth
of the price agreed upon.
Nevertheless, if the vendee would not have bought the immovable

had he known of its smaller area or inferior quality, he may rescind
the sale.
(a) Unit Price Contract:

Wherein the purchase price is determined by way of reference to a
stated rate per unit area (e.g., P1,000 per sq. meter), in which case:
(1) If the vendor delivers less than the area agreed upon, the
At least 24 monthly installments vendee may:
(c) Right to Pay Price Even After Expiration of Period (a) oblige the vendor to deliver all that may be stated in the
contract, if that is possible; or
Article 1592, NCC. In the sale of immovable property, even though
(b) if the foregoing is not possible, the vendee may either demand
it may have been stipulated that upon failure to pay the price at the
for the proportionate reduction of the purchase or ask for
time agreed upon the rescission of the contract shall of right take
rescission of the contract, if the lack in the area is not less
place, the vendee may pay, even after the expiration of the period,
than 1/10 of the stated area (1539[1]).
as long as no demand for rescission of the contract has been made
(c) Nevertheless, if the vendee would not have bought the
upon him either judicially or by a notarial act. After the demand, the
immovable had he known of its smaller area, he may rescind
court may not grant him a new term.
the sale. (1539[4])
(2) If the area is the same but any part is not of the quality specified
 In the sale of immovable property, Article 1592 CC allows the
in the contract, the same rule as the foregoing shall apply and
buyer to still pay, even after the expiration of the period allowed for
rescission shall take place only when the inferior value of the
payment, as long as no demand for rescission has been made
thing sold exceeds 1/10 of the price agreed upon (1539[2,3]).
(1592), whether judicially or by notarial act.
Nevertheless, if the vendee would not have bought the immovable
o In case of bridge of reciprocal obligations, but the object is
had he known of its inferior quality, he may rescind the sale.
IMMOVABLE property, 1592 applies.
(1539[4])
o 1191 Applies to other contracts creating reciprocal obligations
(3) If the vendor delivers more than the area stated in the contract,
o 1592 applies only to a CONTRACT OF SALE, NOT A
the vendee has the option to accept only the amount agreed
CONTRACT TO SELL.
upon or to accept the whole area, provided he pays for the
 Even an offer to pay prior to the demand for rescission is
additional area at the contract rate. (1539[5])
sufficient to defeat the seller’s right to rescind under article
1592. (Laforteza v. Machuca) But Article 1592 applies only to a
(b) Lump Sum Contract
contract of sale, and not to a sale on installment or a contract to
Article 1542, NCC. In the sale of real estate, made for a lump sum
sell. (Valarao v. CA)
and not at the rate of a certain sum for a unit of measure or number,
 There must be an ACKNOWLEDGEMENT, not a mere jurat
there shall be no increase or decrease of the price, although there be
a greater or less area or number than that stated in the contract.
Sale with Assumption of Mortgage
 Deemed conditional sale
The same rule shall be applied when two or more immovables are
 In relation to substitution of person of debtor sold for a single price; but if, besides mentioning the boundaries,
o The creditor must CONSENT to assumption of mortgage which is indispensable in every conveyance of real estate, its area or
o If the creditor does not CONSENT to the assumption of number should be designated in the contract, the vendor shall be
mortgage or the substitution of the debtor, the buyer of the bound to deliver all that is included within said boundaries, even
mortgaged property will NOT become a third person when it exceeds the area or number specified in the contract; and,
interested in the fulfillment of the debtor’s obligation. THUS, should he not be able to do so, he shall suffer a reduction in the price,
he cannot compel the creditor to accept payments from him. in proportion to what is lacking in the area or number, unless the
contract is rescinded because the vendee does not accede to the
Two Types of Pricing Agreements in Sale Involving Real Estate failure to deliver what has been stipulated.
Article 1539, NCC. The obligation to deliver the thing sold includes
that of placing in the control of the vendee all that is mentioned in the Which states a full purchase price for an immovable the area of
contract, in conformity with the following rules: which may be declared based on the estimate or where both the area
and boundaries are stated.
If the sale of real estate should be made with a statement of its area, (1) In case the area of the immovable is stated in the contract
at the rate of a certain price for a unit of measure or number, the based on an estimate:
vendor shall be obliged to deliver to the vendee, if the latter should (a) the actual area delivered may not measure up exactly with
demand it, all that may have been stated in the contract; but, should the area stated in the contract;
this be not possible, the vendee may choose between a proportional (b) there shall be no increase or decrease of the price although
reduction of the price and the rescission of the contract, provided there be a greater or lesser area or number than that stated in
that, in the latter case, the lack in the area be not less than one-tenth the contract (1542[1]);
of that stated. (c) however, the discrepancy must not be substantial—the
use of “more or less” or similar words in designating quantity
The same shall be done, even when the area is the same, if any part covers only a reasonable excess or deficiency (Rudolf
of the immovable is not of the quality specified in the contract. Lietz, Inc. v. CA).
(2) Where both the area and the boundaries of the immovable are (1) Prohibition Against Recovery of “Unpaid Balance of
declared, the area covered within the boundaries of the Price"
immovable prevails over the stated area.  The seller is prohibited from recovering any “unpaid balance
 In cases of conflict between areas and boundaries, it is the of price (1484[3]) —
latter which should prevail (1542[2]). o the idea is to limit the mortgagee (vendor) to the property
 Hence, the vendor shall be bound to deliver all that is included mortgaged (Macondray & Co. Inc. v. Eustaqio); hence, the
within said boundaries, even when it exceeds the area or seller is barred from recovering not only the balance of the
number specified in the contract; and, should he not be able to price, but also the interest on the principal, attorney’s fees,
do so, he shall suffer a reduction in the price, in proportion to expenses of collection, and the costs. (Macondray)
what is lacking in the area or number, unless the contract is  However, the law requires the actual foreclosure of the
rescinded because the vendee does not accede to the failure to mortgaged chattel. It is the actual sale of the mortgaged chattel
deliver what has been stipulated (1542[2]). that would bar the creditor (who chooses to foreclose) from
recovering any unpaid balance. (Manila Motor Co. v. Fernandez)
Remedies of Seller If Price Not Paid in Sale of Personal Property on
Installments (2) Applicability
Article 1484, NCC. In a contract of sale of personal property the price  In order for Article 1484(3) to apply, there must be vendor-vendee
of which is payable in installments, the vendor may exercise any of relationship between the parties and the contract between them
the following remedies: must be a contract of sale of personal property in installments.
(1) Exact fulfillment of the obligation, should the vendee fail to pay;  If the subject matter of the chattel mortgage was bought from
(2) Cancel the sale, should the vendee’s failure to pay cover two or a third party and the contract between the parties is a contract
more installments; of loan with accessory chattel mortgage contract, Article 1484(3)
(3) Foreclose the chattel mortgage on the thing sold, if one has is not applicable (Equitable Savings Bank v. Palces).
been constituted, should the vendee’s failure to pay cover two  The prohibition against recovery of the unpaid balance of the price
or more installments. In this case, he shall have no further action also applies to contracts purporting to be leases of personal
against the purchaser to recover any unpaid balance of the property with option to buy, when the lessor has deprived the
price. Any agreement to the contrary shall be void. lessee of the possession or enjoyment of the thing (1485).
Article 1485, NCC. The preceding article shall be applied to Security Agreement – 1484(3) still applies if the payment of installments
contracts purporting to be leases of personal property with option to is secured by personal property.
buy, when the lessor has deprived the lessee of the possession or
enjoyment of the thing. For 1484(3) to apply, the contract must be a contract of sale. The subject
matter of the contract must also be made a security for the payment of
(a) Three Alternative Remedies: the installments. The purchase price is payable in installments.
(1) Exact fulfillment of the obligation (action for collection of
the price), available even if failure to pay covers only a single D. Pacto De Retro Sale and Equitable Mortgage
installment (1484[1]);
(i) This involves collection of the purchase price. 1. Pacto de Retro Sale
(2) Rescission or cancellation of the sale, if the failure to pay
covers two or more installments (1484[2]); or Concept
(i) Requires two defaults on payments. (a) Definition
(ii) There must be mutual restitution. Article 1601, NCC. Conventional redemption shall take place when
(3) Foreclose the chattel mortgage, if the failure to pay covers the vendor reserves the right to repurchase the thing sold, with the
two or more installments (1484[3]). (Recto Law; but this is obligation to comply with the provisions of article 1616 and other
now part of the Civil Code and should no longer be called stipulations which may have been agreed upon.
Recto Law)
 If the vendor has elected to avail himself of any of the remedies, he Article 1616, NCC. The vendor cannot avail himself of the right of
is deemed to have renounced the others (Universal Motors Corp. repurchase without returning to the vendee the price of the sale, and
v. Dy Hian Tat). in addition:
 The filing of a collection suit bars the foreclosure of the mortgage. (1) The expenses of the contract, and any other legitimate
The mere act of filing of an ordinary action for collection operates payments made by reason of the sale;
as a waiver of the mortgagee-creditor’s remedy to foreclose the (2) The necessary and useful expenses made on the thing sold.
mortgage. (Bank of America v. American Realty Corp.)
A sale with a right of repurchase (pacto de retro sale), also known as
Unpaid balance of the purchase price generally includes EVERYTHING conventional redemption, takes place when the vendor reserves the
– principal, interest, penalties, expenses of litigation, attorney’s fees. right to repurchase the thing sold, with the obligation of returning
These may not be recovered. to the vendee the price of the sale, the expenses of the contract and
any other legitimate payments made by reason of the sale, the
Q. When is the recovery of some other amount even if the contract of necessary and useful expenses made on the thing sold, and the
security was foreclosed? When the collateral is not voluntarily delivered obligation of complying with such other stipulations which may have
by the debtor to the creditor or when the debtor has intentionally been agreed upon. (1601, 1616)
concealed the security. This will force the creditor to file an action for Conventional redemption (agreed upon by the parties)
replevin. Thus, the court allows reasonable amounts of attorney’s fees (b) Grant of Right of Repurchase Must be Simultaneous
and litigation costs.  To be a pacto de retro sale, the grant of the right of repurchase
must be made simultaneously with the sale although not
(b) If Seller Chooses to Foreclose Chattel Mortgage: necessarily in the same instrument (Capulong v. CA);
o in fact, if the sale is in writing and already complies with the (a) Definition
requirement of the Statute of Frauds, the verbal grant of the An equitable mortgage has been defined as one which, although
right of repurchase simultaneously made with the sale lacking in some formality, or form or words, or other requisites
may be proven by parol evidence and is not required to demanded by a statute, nevertheless reveals the intention of the
separately meet the requirements of the Statute. (MIAA v. CA) parties to charge real property as security for a debt, and contains
 However, if the grant of right of repurchase was made long nothing impossible or contrary to law. (Lumayag v. Heirs of Jacinto
after the sale was already perfected, the transaction is not a Nemeo)
pacto de retro sale but merely a grant of an option to buy back.
(Villarica v. CA) The essential requisites of an equitable mortgage are:
(1) the parties enter into what appears to be a contract of sale,
(c) Transfer of ownership (2) but their intention is to secure an existing debt by way of
 In a true pacto de retro sale, title to and ownership of property mortgage. (Vda. De Delfin v. Dellota)
are immediately vested in the vendee a retro, subject only to
the resolutory condition that the vendor repurchases it within (b) Nomenclature Not Controlling
the stipulated period. (Lumayag v. Heirs of Jacinto Nemeo) Even if a contract is denominated as a pacto de retro, the owner of the
 The failure of the vendor a retro to repurchase the property property may still disprove it by means of parol evidence, provided
vests upon the vendee a retro by operation of law the absolute that the nature of the agreement is placed in issue by the pleadings
title and ownership over the property sold. filed with the trial court. (Ramos v. Sarao)
Period of Redemption (Repurchase) Presumption of Equitable Mortgage

Article 1606, NCC. The right referred to in article 1601, in the Article 1602, NCC. The contract shall be presumed to be an
absence of an express agreement, shall last four years from the date equitable mortgage, in any of the following cases:
of the contract. (1) When the price of a sale with right to repurchase is unusually
inadequate;
Should there be an agreement, the period cannot exceed ten years. (2) When the vendor remains in possession as lessee or otherwise;
(3) When upon or after the expiration of the right to repurchase
However, the vendor may still exercise the right to repurchase within another instrument extending the period of redemption or
thirty days from the time final judgment was rendered in a civil action granting a new period is executed;
on the basis that the contract was a true sale with right to repurchase. (4) When the purchaser retains for himself a part of the purchase
price;
(a) Period (5) When the vendor binds himself to pay the taxes on the thing
(1) the period expressly agreed upon (1606[1]), but such period sold;
cannot exceed 10 years (1606[2]); (6) In any other case where it may be fairly inferred that the real
(2) in the absence of an express agreement, it shall be four years intention of the parties is that the transaction shall secure the
from the date of the contract (1606[1]); or payment of a debt or the performance of any other obligation.
(3) if the vendor questions the transaction as an equitable mortgage
but the court eventually rules that it was indeed a pacto de retro In any of the foregoing cases, any money, fruits, or other benefit to
sale, the vendor may still exercise the right to repurchase be received by the vendee as rent or otherwise shall be considered
within 30 days from finality of the judgment (1606[3]). as interest which shall be subject to the usury laws.
But the application of the latter rule is predicated upon the good faith of
the vendor a retro, believing in good faith that the agreement was in (a) Instance Where Presumption Apply
reality a mortgage. (Felicen, Sr. v. Orias) (1) when the price of a sale with right to repurchase is unusually
The period does not apply if the vendor only filed the case to get a longer inadequate;
period to repurchase. (a) In an ordinary sale, it may be indicative of a vitiation of consent
(b) What must be paid to vendee upon repurchase (b) In PDR sale, it might be an equitable mortgage.
(1) the price of the sale; (2) when the vendor remains in possession as lessee or otherwise;
(2) the expenses of the contract, and any other legitimate payments (3) when upon or after the expiration of the right to repurchase another
made by reason of the sale; and instrument extending the period of redemption or granting a
(3) necessary and useful expenses made on the thing sold. (1616) new period is executed;
 Thus, if prior to repurchase the vendee a retro introduced an (4) when the purchaser retains for himself a part of the purchase
improvement on the subject property, he is neither a builder price;
in good faith nor a builder in bad faith because the applicable (5) when the vendor binds himself to pay the taxes on the thing
laws are Articles 1606 and 1616 which require the vendor a retro sold; and
to also pay the necessary and useful expenses made on the thing (6) in any other case where it may be fairly inferred that the real
sold. (Narvaez v. Alciso) intention of the parties is that the transaction shall secure the
 Since the payment of the redemption or repurchase price is merely payment of a debt or the performance of any other obligation.
incidental to the exercise of a right and not payment of an existing (1602)
obligation, tender of a check is sufficient to compel redemption Any of the circumstances laid out in Article 1602, neither the
but is not of itself a payment that relieves the redemptioner concurrence nor an overwhelming number of the enumerated
from his liability to pay the redemption price. (Fortunado v. CA) circumstances, is sufficient to support the conclusion that a contract of
sale is in fact an equitable mortgage. (Ramos v. Sarao)
2. Equitable Mortgage If the presumption is not rebutted, the transmission of ownership will be
Why? Pacto de retro sale can used to circumvent the prohibition on VOID. That is pactum commissorium. The mortgage obligation subsists.
pactum commissorium (to avoid foreclosure). The period of repurchase The remedy of the vendee a retro who is actually a creditor mortgagee
is actually the period to pay the mortgage obligation. is to foreclose mortgage.
Concept
(b) Effect If Pacto De Retro Sale is Actually Equitable Mortgage

Article 1605, NCC. In the cases referred to in articles 1602 and 1604,
the apparent vendor may ask for the reformation of the instrument.
Article 1359, NCC. When, there having been a meeting of the minds
of the parties to a contract, their true intention is not expressed in the
instrument purporting to embody the agreement, by reason of
mistake, fraud, inequitable conduct or accident, one of the parties
may ask for the reformation of the instrument to the end that such
true intention may be expressed.
If mistake, fraud, inequitable conduct, or accident has prevented a

meeting of the minds of the parties, the proper remedy is not
reformation of the instrument but annulment of the contract.
(1) any money, fruits, or other benefit to be received by the

vendee as rent or otherwise shall be considered as interest
which shall be subject to the usury law (1602, last para);
(2) the apparent vendor who, in reality is a mortgagor, may ask for
the reformation of the instrument (1605), since the true intention
of the parties is not expressed in the instrument (1359);
(3) if there is a stipulation in the sale with pacto de retro providing that
complete and absolute title shall be vested on the vendee should
the vendors fail to redeem the property on the specified date, the
same is void for being a pactum commissorium [automatic
appropriation by the creditor of the thing in the event of nonpayment
of the principal obligation.] (Olca v. CA) and
(4) the proper remedy in case the borrower refuses to pay the “price”
is to foreclose on the mortgage, and there can be no loss of the
purported seller’s right to redeem since this would constitute the
process known as a pactum commissorium.
PART 2: CONTRACT OF LEASE Article 1646, NCC. The persons disqualified to buy referred to in
articles 1490 and 1491, are also disqualified to become lessees of
E. Lease of Things the things mentioned therein.
1. Basic Concepts Article 1490, NCC. The husband and the wife cannot sell property to
each other, except:
a. Two Kinds of Contract of Lease (1) When a separation of property was agreed upon in the marriage
settlements; or
Article 1642, NCC. The contract of lease may be of things, or of work (2) When there has been a judicial separation of property under
and service. article 191.
(1) Contact of Lease (proper) – it is a lease of things, or when the Article 1491, NCC. The following persons cannot acquire by
subject matter is a thing; and purchase, even at a public or judicial auction, either in person or
(2) Contract for Piece of Work — it is a lease of service, or when the through the mediation of another:
subject matter is a service. (1642) (1) The guardian, the property of the person or persons who may
be under his guardianship;
b. Contract of Lease of Things (2) Agents, the property whose administration or sale may have
been intrusted to them, unless the consent of the principal has
Article 1643, NCC. In the lease of things, one of the parties binds been given;
himself to give to another the enjoyment or use of a thing for a price (3) Executors and administrators, the property of the estate under
certain, and for a period which may be definite or indefinite. However, administration;
no lease for more than ninety-nine years shall be valid. (4) Public officers and employees, the property of the State or of
any subdivision thereof, or of any government-owned or
Article 1935, NCC. The bailee in commodatum acquires the use of controlled corporation, or institution, the administration of which
the thing loaned but not its fruits; if any compensation is to be paid has been intrusted to them; this provision shall apply to judges
by him who acquires the use, the contract ceases to be a and government experts who, in any manner whatsoever, take
commodatum. part in the sale;
(5) Justices, judges, prosecuting attorneys, clerks of superior and
(a) Essence: It is a contract involving the grant of temporary use or inferior courts, and other officers and employees connected with
enjoyment of a property to another in consideration of the the administration of justice, the property and rights in litigation
payment of a price certain in money or its equivalent (called “rent”) or levied upon an execution before the court within whose
(1643). jurisdiction or territory they exercise their respective functions;
o If the grant of temporary use or enjoyment of a property in this prohibition includes the act of acquiring by assignment and
favor of another is gratuitous, the contract is commodatum shall apply to lawyers, with respect to the property and rights
(1935). which may be the object of any litigation in which they may take
o If the consideration is not payment of a price but the part by virtue of their profession;
delivery of another thing or rendition of service, an (6) Any others specially disqualified by law.
innominate contract will result.
(b) Lessor Need Not be the Owner: Since lease does not involve (1) Those persons disqualified to buy under Articles 1490 and
any transfer of ownership, the lessor need not be the owner of 1491, are also disqualified to become lessees of the things
the property leased (Ballesteros v. Abion). mentioned therein. (1646)
(1) However, the lessor must have a right (e.g., usufructuary (2) Foreigners are allowed to lease lands in the Philippines:
or lessee) or at least an authority (e.g., as an agent of the (a) if the foreigner is investing in the Philippines, the lease
owner); otherwise, the contract is void because the cause or shall be for a period not exceeding 50 years, renewable
object of which did not exist at the time of the transaction once for a period of not more than 25 years and the lease
(Ballesteros). are shall be used solely for the purpose of the investment
(c) Consensual Contract: Being a consensual contract, it is upon the mutual agreement of the parties (Sec. 4 RA 7652,
perfected at the moment there is a meeting of the minds on the Investor’s Lease Act);
thing and the cause and consideration which are to constitute the (b) if the foreigner is not investing in the Philippines, he is
contract (Bugatti v. CA). allowed to lease private lands in the Philippines but for a
maximum period only of 25 years, renewable for another
c. Subject-matter period of 25 years upon mutual agreement of both parties.
(Sec. 1 PD 471 in relation to Sec. 5(1) RA 7652)
(a) What Can be Subject-matter (3) When Governed by Statute of Frauds
Article 1645, NCC. Consumable goods cannot be the subject matter If the lease of real property, including lands, is for a period of more
of a contract of lease, except when they are merely to be exhibited than one year, it must be in writing; otherwise, the contract is
or when they are accessory to an industrial establishment. unenforceable (1403[2e]).
(4) When Special Power Necessary
Either real or personal property. Article 1647, NCC. If a lease is to be recorded in the Registry of
 As to personal property, consumable goods cannot be the Property, the following persons cannot constitute the same without
subject matter of a contract of lease, except when they are proper authority: the husband with respect to the wife’s paraphernal
merely to be exhibited or when they are accessory to an industrial real estate, the father or guardian as to the property of the minor or
establishment. ward, and the manager without special power.
(b) Lease of Rural and Urban Lands

Article 1878[8], NCC. Special powers of attorney are necessary in leased may yield in one year, or which it may yield once, although
the following cases: two or more years may have to elapse for the purpose.
(8) To lease any real property to another person for more than one
year; Article 1687, NCC. If the period for the lease has not been fixed, it is
understood to be from year to year, if the rent agreed upon is annual;
 If the lease is to be recorded in the Registry of Property, the from month to month, if it is monthly; from week to week, if the rent is
following cannot constitute the same without special power: weekly; and from day to day, if the rent is to be paid daily. However,
(a) husband with respect to the wife’s paraphernal real estate; even though a monthly rent is paid, and no period for the lease has
(b) father or guardian as to the property of the minor or ward; been set, the courts may fix a longer term for the lease after the
and lessee has occupied the premises for over one year. If the rent is
(c) the manager (1647). weekly, the courts may likewise determine a longer period after the
 However, even if the lease is not to be recorded, a special power lessee has been in possession for over six months. In case of daily
is also necessary when the lease is for a period of more than rent, the courts may also fix a longer period after the lessee has
one year (1878 [8]). stayed in the place for over one month.
 In the foregoing, if the lease is without a special power, the same
is void. (Vda. De Chua v. IAC)  the period agreed upon; however, no lease for more than 99
years shall be valid (1643);
(5) Effect of Recording in Registry of Property  when the duration of the lease has not been fixed and it is a
Article 1648, NCC. Every lease of real estate may be recorded in the lease of rural lands, it is understood to have been made for all the
Registry of Property. Unless a lease is recorded, it shall not be time necessary for the gathering of the fruits which the whole
binding upon third persons. estate leased may yield in one year, or which it may yield once,
although two or more years may have to elapse for the purpose
Article 1676, NCC. The purchaser of a piece of land which is under (1682);
a lease that is not recorded in the Registry of Property may terminate  when the period for the lease has not been fixed and it is a lease
the lease, save when there is a stipulation to the contrary in the of urban land, it is understood to be
contract of sale, or when the purchaser knows of the existence of the o from year to year, if the rent agreed upon is annual;
lease. o from month to month, if it is monthly;
o from week to week, if the rent is weekly; and
If the buyer makes use of this right, the lessee may demand that he o from day to day, if the rent is to be paid daily. (1687)
be allowed to gather the fruits of the harvest which corresponds to o However, the court may fix a longer period when:
the current agricultural year and that the vendor indemnify him for  the rent is paid daily and the lessee has stayed in the
damages suffered. place for over one month;
 the rent is paid weekly and the lessee has been in
If the sale is fictitious, for the purpose of extinguishing the lease, the possession for over six months; or
supposed vendee cannot make use of the right granted in the first  the rent is paid monthly and the lessee has occupied the
paragraph of this article. The sale is presumed to be fictitious if at the premises for over one year.
time the supposed vendee demands the termination of the lease, the o However, when the lease contract provides that it "shall
sale is not recorded in the Registry of Property. continue for an indefinite period provided the lessee is up-
to-date in the payment of his monthly rentals," Article 1687
 Unless a lease is recorded, it shall not be binding upon third does not apply because the lease is not one with a period
persons (1648). but instead subject to a resolutory condition. (Jespajo
 The purchaser of a piece of land which is under a lease that is Realty Corp. v. CA)
not recorded in the Registry' of Property may terminate the lease
except: d. Rights and Obligations of the Parties
(a) when there is a stipulation to the contrary in the contract of
sale, or (a) Right to Assign Contract
(b) when the purchaser knows of the existence of the lease Article 1649, NCC. The lessee cannot assign the lease without the
(1676[1]). consent of the lessor, unless there is a stipulation to the contrary.
(i) But if the sale is fictitious and was only resorted to for
the purpose of extinguishing the lease, the supposed (1) Rule: The lessee cannot assign the lease (1649);
vendee cannot terminate the lease. (2) Exceptions
(ii) The sale is presumed to be fictitious if at the time the (i) if the assignment is with the consent of the lessor; or
supposed vendee demands the termination of the (ii) even without the lessor’s consent, if there is a
lease, the sale is not recorded in the Registry of stipulation in the contract allowing the assignment of
Property [1676[3]. the lease.
(6) Term of Lease
Article 1643, NCC. In the lease of things, one of the parties binds (b) Right to Sublease
himself to give to another the enjoyment or use of a thing for a price Article 1650, NCC. When in the contract of lease of things there is
certain, and for a period which may be definite or indefinite. However, no express prohibition, the lessee may sublet the thing leased, in
no lease for more than ninety-nine years shall be valid. whole or in part, without prejudice to his responsibility for the
performance of the contract toward the lessor.
Article 1682, NCC. The lease of a piece of rural land, when its
duration has not been fixed, is understood to have been for all the (1) Rule: The lessee may sublet the thing leased;
time necessary for the gathering of the fruits which the whole estate (2) Exception: He cannot do so if expressly prohibited in the
contract (1650).
(3) Duty of Sublessee
trespass in fact (perturbation de mero hecho) made by a third

Article 1651, NCC. Without prejudice to his obligation toward the person (GQ Garments, Inc. v. Miranda).
sublessor, the sublessee is bound to the lessor for all acts which refer (a) In other words, the duty of the lessor to maintain the lessee in
to the use and preservation of the thing leased in the manner the peaceful and adequate enjoyment of the leased property
stipulated between the lessor and the lessee. for the entire duration of the contract is merely a warranty
that the lessee shall not be disturbed in having legal and
Article 1652, NCC. The sublessee is subsidiarily liable to the lessor not physical possession of the property.
for any rent due from the lessee. However, the sublessee shall not (b) In case of trespass in fact, the lessor is not liable because
be responsible beyond the amount of rent due from him, in the lessee shall have a direct action against the intruder
accordance with the terms of the sublease, at the time of the extra- (1664).
judicial demand by the lessor.
(d) Principal Obligations of Lessee
Payments of rent in advance by the sublessee shall be deemed not Article 1657, NCC. The lessee is obliged:
to have been made, so far as the lessor’s claim is concerned, unless (1) To pay the price of the lease according to the terms stipulated;
said payments were effected in virtue of the custom of the place. (2) To use the thing leased as a diligent father of a family, devoting
it to the use stipulated; and in the absence of stipulation, to that
 he is bound to the lessor for all acts which refer to the use and which may be inferred from the nature of the thing leased,
preservation of the thing leased in the manner stipulated according to the custom of the place;
between the lessor and the lessee (1651); (3) To pay the expenses for the deed of lease.
 he is subsidiarily liable to the lessor for any rent due from the
lessee but he cannot be responsible beyond the amount of rent (1) to pay the price of the lease according to the terms stipulated;
due from him, in accordance with the terms of the sublease. (2) to use the thing leased as a diligent father of a family,
Insofar as the lessor’s claim is concerned, payment of rent in devoting it to the use stipulated, and in the absence of
advance by the sublessee shall be deemed not to have been made. stipulation, to that which may be inferred from the nature of
(1652) the thing leased, according to the customs of the place; and
(3) to pay the expenses for the deed of lease. (1657)
(c) Principal Obligations of Lessor
Article 1654, NCC. The lessor is obliged: (e) Right of Lessee to Suspend Payment of Rent
(1) To deliver the thing which is the object of the contract in such a Article 1658, NCC. The lessee may suspend the payment of the rent
condition as to render it fit for the use intended; in case the lessor fails to make the necessary repairs or to maintain
(2) To make on the same during the lease all the necessary repairs the lessee in peaceful and adequate enjoyment of the property
in order to keep it suitable for the use to which it has been leased.
devoted, unless there is a stipulation to the contrary;
(3) To maintain the lessee in the peaceful and adequate enjoyment The lessee may suspend the payment of the rent in case the lessor
of the lease for the entire duration of the contract. fails to make the necessary repairs or to maintain the lessee in
peaceful and adequate enjoyment of the property leased.
Article 1664, NCC. The lessor is not obliged to answer for a mere
act of trespass which a third person may cause on the use of the e. Implied New Lease (Tacita Reconduccion).
thing leased; but the lessee shall have a direct action against the
intruder. (a) Concept
Tacita reconduccion (or implied new lease) refers to the right of the
There is a mere act of trespass when the third person claims no right lessee to continue enjoying the material or de facto possession of
whatever. the thing leased within a period of time fixed by law. During its
existence, the lessee can prevent the lessor from evicting him from the
(1) to deliver the thing which is the object of the contract in such a disputed premises. (Yuki, Jr. v. Co)
condition as to render it fit for the use intended (1654[1]) – since
the delivery of the object of the contract is merely an obligation (b) Requisites
created by the contract upon perfection, the lessor can be Article 1670, NCC. If at the end of the contract the lessee should
compelled to make the delivery (Dela Cruz v. El Seminario dela continue enjoying the thing leased for fifteen days with the
Archdiocese de Manila); acquiescence of the lessor, and unless a notice to the contrary by
(2) to make on the leased premises during the lease all the necessary either party has previously been given, it is understood that there is
repairs in order to keep it suitable for the use to which it has been an implied new lease, not for the period of the original contract, but
devoted, unless there is a stipulation to the contrary (1654[2]) – the for the time established in articles 1682 and 1687. The other terms of
term “repairs” does not extend to: the original contract shall be revived.
(a) the reconstruction of a leased house that has been
completely destroyed by fire because “repairs” can refer (1) the term of the original contract of lease has expired;
only to partial destruction or impairment (Lizares v. (2) the lessor has not given the lessee a notice to vacate; and
Hernaez); and (3) the lessee continued enjoying the thing leased for 15 days
(b) the “filling up” of a lot, since this would not be a “repair” but with the acquiescence of the lessor. This acquiescence may
an “improvement,” repair being limited to putting back be inferred from the failure of the lessor to serve notice to
something into its original stipulation (Alburo v. Villanueva); vacate upon the lessee (1670)
(3) to maintain the lessee in the peaceful and adequate enjoyment
of the lease for the entire duration of the contract (1654[3]) – the (c) Effect of Implied New Lease
lessor is liable to the lessee only for cases of legal trespass  Except for the period, the other terms of the original contract are
(perturbation de mero derecho) but not in cases of mere deemed revived. (1670)
 The “other terms of the original contract” in Article 1670, are only (b) Two Kinds
those terms which are germane to the lessee’s right of (1) where contractor employs only his labor or skill; or
continued enjoyment of the property leased (Vda. De Chua v. (2) where contractor employs labor and also furnishes the
IAC), such as the amount of the rental, the date when it must be material (1713)
paid, the care of the property, the responsibility of repairs, etc.
(Dizon v. Magsaysay). When Contractor Also Furnishes Materials
 But no such presumption may be indulged in with respect to Article 1714, NCC. If the contractor agrees to produce the work from
special agreements which by nature are foreign to the right of material furnished by him, he shall deliver the thing produced to the
occupancy or enjoyment inherent in a contract of lease, like the employer and transfer dominion over the thing. This contract shall be
option to buy the leased premises or a right of first refusal governed by the following articles as well as by the pertinent
granted in the original contract. provisions on warranty of title and against hidden defects and the
payment of price in a contract of sale.
(d) Term of Implied New Lease
Article 1687, NCC. If the period for the lease has not been fixed, it is Article 1717, NCC. If the contractor bound himself to furnish the
understood to be from year to year, if the rent agreed upon is annual; material, he shall suffer the loss if the work should be destroyed
from month to month, if it is monthly; from week to week, if the rent is before its delivery, save when there has been delay in receiving it.
weekly; and from day to day, if the rent is to be paid daily. However,
even though a monthly rent is paid, and no period for the lease has (a) Principal Obligations of Contractor
been set, the courts may fix a longer term for the lease after the (1) to deliver the thing produced;
lessee has occupied the premises for over one year. If the rent is (2) to transfer dominion over the thing;
weekly, the courts may likewise determine a longer period after the (3) to warrant that he has the right to transfer ownership of
lessee has been in possession for over six months. In case of daily the thing (warranty of title) and that the thing shall be free
rent, the courts may also fix a longer period after the lessee has from hidden defects or faults (warranty against hidden
stayed in the place for over one month. defect). (1714)
(b) Effect of Loss Prior to Delivery
Article 1682, NCC. The lease of a piece of rural land, when its The contractor shall suffer the loss, unless there has been delay in
duration has not been fixed, is understood to have been for all the receiving the thing produced. (1717)
time necessary for the gathering of the fruits which the whole estate
leased may yield in one year, or which it may yield once, although When Contractor Employs Labor Only
two or more years may have to elapse for the purpose. Article 1718, NCC. The contractor who has undertaken to put only
his work or skill, cannot claim any compensation if the work should
(1) In case of urban lands, it is understood to be from year to be destroyed before its delivery, unless there has been delay in
year, if the rent agreed upon is annual; from month to month, receiving it, or if the destruction was caused by the poor quality of the
if it is monthly; from week to week, if the rent is weekly; and material, provided this fact was communicated in due time to the
from day to day, if the rent is to be paid daily (1687 in rel. to owner. If the material is lost through a fortuitous event, the contract
1670); is extinguished.
(2) In case of rural lands, it is understood to have been made for
all the time necessary for the gathering of the fruits which the (a) Rule: He cannot claim any compensation if the work is
whole estate leased may yield in one year, or which it may destroyed before delivery. (1718)
yield once, although two or more years may have to elapse (b) Exceptions
for the purpose (1682 in rel. to 1670). (1) When there has been delay in receiving it; or
(2) if the destruction was caused by the poor quality of the
(e) Effect When No Implied New Lease material, provided this fact was communicated in due time to
Article 1671, NCC. If the lessee continues enjoying the thing after the owner.
the expiration of the contract, over the lessor’s objection, the former
shall be subject to the responsibilities of a possessor in bad faith. (c) Effect of Defect in Materials
Article 1722, NCC. If the work cannot be completed on account of a
If the lessee continues enjoying the thing after the expiration of the defect in the material furnished by the employer, or because of orders
contract when there is no implied new lease because the lessor objected from the employer, without any fault on the part of the contractor, the
to the continued enjoyment by the lessee, the latter shall be subject to latter has a right to an equitable part of the compensation
the responsibilities of a possessor in bad faith. proportionally to the work done, and reimbursement for proper
expenses made.
F. Contract for Piece of Work
If the work cannot be completed on account of a defect in the
1. Basic Concepts material furnished by the employer, or because of orders from the
employer, without any fault on the part of the contractor, the latter has
Concept a right to an equitable part of the compensation proportionally to
Article 1713, NCC. By the contract for a piece of work the contractor the work done, and reimbursement for proper expenses made.
binds himself to execute a piece of work for the employer, in
consideration of a certain price or compensation. The contractor may (d) Mechanic’s Lien
either employ only his labor or skill, or also furnish the material. Article 1731, NCC. He who has executed work upon a movable has
a right to retain it by way of pledge until he is paid.
(a) Definition: By the contract for a piece of work the contractor binds
himself to execute a piece of work for the employer, in  He who has executed a work upon a movable has a right to retain
consideration of a certain price or compensation. The obligation it by way of pledge until he is paid (1731).
created on the part of the contractor is an obligation to do.
 The right of retention is conditioned upon the execution of work Article 1728, NCC. The contractor is liable for all the claims of
upon the movable. Thus, if the contractor fails to accomplish the laborers and others employed by him, and of third persons for death
repairs on the truck, the right to retain the truck in accordance with or physical injuries during the construction.
Article 1731 does not arise. (Optimum Moto Center Corp. v. Tan)
The contractor is liable for all the claims of laborers and others
Effect of Acceptance of Work employed by him, and of third persons for death or physical injuries
Article 1719, NCC. Acceptance of the work by the employer relieves during the construction.
the contractor of liability for any defect in the work, unless:
(1) The defect is hidden and the employer is not, by his special (c) Unpaid Wages of Employees
knowledge, expected to recognize the same; or
(2) The employer expressly reserves his rights against the Article 1729, NCC. Those who put their labor upon or furnish
contractor by reason of the defect. materials for a piece of work undertaken by the contractor have an
action against the owner up to the amount owing from the latter to
Article 1723, NCC. The engineer or architect who drew up the plans the contractor at the time the claim is made. However, the following
and specifications for a building is liable for damages if within fifteen shall not prejudice the laborers, employees and furnishers of
years from the completion of the structure, the same should collapse materials:
by reason of a defect in those plans and specifications, or due to the (1) Payments made by the owner to the contractor before they are
defects in the ground. The contractor is likewise responsible for the due;
damages if the edifice falls, within the same period, on account of (2) Renunciation by the contractor of any amount due him from the
defects in the construction or the use of materials of inferior quality owner.
furnished by him, or due to any violation of the terms of the contract.
If the engineer or architect supervises the construction, he shall be This article is subject to the provisions of special laws.
solidarily liable with the contractor.
(1) The contractor is liable for the unpaid wages of his
Acceptance of the building, after completion, does not imply waiver employees;
of any of the causes of action by reason of any defect mentioned in (2) However, the owner is also liable to pay such unpaid
the preceding paragraph. wages "up to the amount owing from (him) to the
contractor at the time the claim is made. (JL Investment and
The action must be brought within ten years following the collapse of Dev., Inc. v. Tendon PH)
the building. (i) To this extent, the owner’s liability is solidary with the
contractor, if both are sued together. But after
(a) Rule: Acceptance of the work by the employer relieves the payment, the owner can seek reimbursement from
contractor of liability for any defect in the work. (1719) the contractor (1729).
(b) Exceptions (ii) However, if the owner has already fully paid the
(1) if the defect is hidden and the employer is not, by his contractor, the former’s liability ceases (Manalo v.
special knowledge, expected to recognize the same; Singson). But payments made by the owner to the
(2) the employer expressly reserves his rights against the contractor before they are due, or renunciation by the
contractor by reason of the defect; and contractor of any amount due him from the owner shall
(3) if a building or edifice falls within 15 years on account of not prejudice the laborers or employees. (1729)
defects in the construction or the use of materials of
inferior quality furnished by him, or due to any violation of
the terms of the contract (1723).
(i) In the latter case, the engineer or architect shall be
solidarity liable with the contractor if he supervises
the construction.
(ii) If the collapse of the building within 15 years from the
completion of the structure is by reason of a defect in
the plans and specifications drawn up by the
engineer or architect, or due to the defects in the
ground, the engineer or architect who drew up the plans
and specifications shall be liable.
(iii) The action against the contractor, engineer, or architect
may be brought within 10 years following the collapse of
the building
Extent of Liability of Contractor

(a) Work Done by His Employees
Article 1727, NCC. The contractor is responsible for the work done
by persons employed by him.
The contractor is responsible for the work done by persons employed

by him.
(b) Death and Physical Injuries During Construction

PART 3: CONTRACT OF COMMON CARRIER 1. Diligence Required

Article 1755, NCC. X
Concept
 A common carrier is bound to carry the passengers safely as far as
A. Carrier human care and foresight can provide, using the utmost diligence
of very cautious persons, with a due regard for all the
Concept and Kinds circumstances. (1755)
 A carrier is a person or corporation who undertakes to transport  Such duty of a common carrier to provide safety to its passengers
or convey goods or persons from one place to another, so obligates it not only during the course of the trip but for so
gratuitously or for hire. long as the passengers are within its premises and where they
 The carrier is classified either as a private/special carrier or as a ought to be in pursuance to the contract of carriage. (LRTA v.
common/public carrier. (Pereña v. Zarate) Navidad)
 Also, the duty which the carrier of passengers owes to its patrons
(a) Private Carrier: extends to persons boarding the cars as well as to those
A private carrier is one who, without making the activity a vocation, alighting therefrom. (Dangwa Transportation Co., Inc. v. CA)
or without holding himself or itself out to the public as ready to act for all  The victim, by stepping on the platform of the bus, is already
who may desire his or its services, undertakes, by special agreement in considered a passenger and is entitled to all the rights and
a particular instance only, to transport goods or persons from one place protection pertaining to such a contractual relation.
to another either gratuitously or for hire. (Pereña)
2. Presumption of Fault in Case of Death or Injuries
(b) Common Carrier
A common carrier is a person, corporation, firm, or association engaged (a) Rule
in the business of carrying or transporting passengers or goods or both, Article 1756, NCC. X
by land, water, or air, for compensation, offering such services to the
public. (Pereña) In case of death of or injuries to passengers, common carriers are
presumed to have been at fault or to have acted negligently, unless
(c) Distinctions they prove that they observed extraordinary diligence as prescribed
above.
Private Carrier Public Carrier
the provisions on governed by the provisions on common (b) Common Carrier Liable for Acts of Employees
ordinary contracts of carriers of the CC, the Public Service Act, Article 1759, NCC. X
the CC govern and other special laws relating to
transportation  Common carriers are liable for the death of or injuries to
diligence required of a a common carrier is required to observe passengers through the negligence or willful acts of the
private carrier is only extraordinary diligence, and is presumed former’s employees, although such employees may have
ordinary, that is, the to be at fault or to have acted negligently acted beyond the scope of their authority or in violation of the
diligence of a good in case of the loss of the effects of orders of the common carriers.
father of the family passengers, or the death or injuries to  This liability of the common carrier does not cease upon proof
passengers. that they exercised all the diligence of a good father of a family
in the selection and supervision of their employees. (1759)
(d) Test o This defense is applicable to the employer only in quasi-delict,
The true test for a common carrier is not the quantity or extent of the not in breach of contract.
business actually transacted, or the number and character of the
conveyances used in the activity, but whether the undertaking is a part (c) Effect of Negligence of Passenger
of the activity engaged in by the carrier that he has held out to the Article 1761, NCC. X
general public as his business or occupation.
 If the undertaking is a single transaction, not a part of the general
business or occupation engaged in, as advertised and held out to
the general public, the individual or the entity rendering such
 The passenger must observe the diligence of a good father of a
service is a private, not a common, carrier.
family to avoid injury to himself.
 If the negligence of the passenger is the proximate cause of his
(e) Are operators of school bus services private or common
death or injuries, the common carrier is not liable.
carriers?
 On the other hand, if the proximate cause of the passenger’s death
They are common carriers because they are:
or injuries is the negligence of the common carrier, the
(1) engaged in transporting passengers generally as a business,
contributory negligence of the passenger does not bar
not just as a casual occupation;
recovery of damages for his death or injuries. However, the
(2) undertaking to carry passengers over established roads by the
amount of damages shall be equitably reduced.
method by which the business was conducted; and
(3) transporting students for a fee. Despite catering to a limited
(d) Effect of Acts of Other Passengers or Strangers
clientele, the operators operated as a common carrier because
they held themselves out as a ready transportation indiscriminately Article 1763, NCC. X
to the students of a particular school living within or near where
they operated the service and for a fee.  If the injuries suffered by a passenger is by reason of the willful
acts or negligence of other passengers or of strangers, the
B. Obligation of Common Carrier to Ensure Safety of Passengers common carrier is responsible thereto if its employees,
through the exercise of the diligence of a good father of a

family, could have prevented or stopped the act or omission.
 When intervening acts of strangers or other passengers is the
direct cause of the injury of a passenger, the degree of care to be
exercised by the common carrier to prevent the incident is
only that of a good father of a family.
(e) Effect of Stipulation Limiting Liability of Common Carrier:

 The responsibility of a common carrier for the safety of passengers

cannot be dispensed with or lessened by stipulation, by the
posting of notices, by statements on tickets, or otherwise.
(1757)
 Likewise, the reduction of fare does not justify any limitation of
the common carrier’s liability;
o however, when a passenger is carried gratuitously, a
stipulation limiting the common carrier’s liability for negligence
is valid, but not for willful acts or gross negligence (1758).
3. Effect of Fortuitous Event Upon Carrier’s Liability
A common carrier may not be absolved from liability in case of force

majeure or fortuitous event alone. The common carrier must still
prove that it was not negligent in causing the death or injury
resulting from an accident (Yobido v. CA) In other words, there must be
an entire exclusion of human agency from the cause of injury or loss.
PART 4: CONTRACT OF PARTNERSHIP (4) The receipt by a person of a share of the profits of a business
is prima facie evidence that he is a partner in the business,
A. Nature of Contract unless such profits were received in payment:
(a) as a debt by installments or otherwise;
1. Concept (b) as wages of an employee or rent to a landlord;
(c) as an annuity to a widow or representative of a deceased
(a) Definition partner;
Article 1767, NCC. By the contract of partnership two or more (d) as interest on a loan, though the amount of payment varies
persons bind themselves to contribute money, property, or industry with the profits of the business; and
to a common fund, with the intention of dividing the profits among (e) as the consideration for the sale of a goodwill of a business or
themselves. other property by installments or otherwise.
Two or more persons may also form a partnership for the exercise of 2. Existence of Juridical Personality
a profession.
(a) Rule
By the contract of partnership two or more persons bind themselves to Article 1768, NCC. The partnership has a juridical personality
contribute money, property, or industry to a common fund, with the separate and distinct from that of each of the partners, even in case
intention of dividing the profits among themselves. of failure to comply with the requirements of article 1772, first
paragraph.
(b) Requisites: In order to constitute a partnership, it must be
established that (Heirs of Tan Eng Kee v. CA; Tocao v. CA): The partnership has a juridical personality separate and distinct
(1) two or more persons bound themselves to contribute money, from that of each of the partners. To be considered a juridical
property, or industry to a common fund; and personality, it is sufficient that a partnership must fulfill these requisites:
(2) they intend to divide the profits among themselves. (1) two or more persons bind themselves to contribute money,
property, or industry to a common fund; and
(c) Characteristics of the Contract: It is consensual, preparatory, (2) intention on the part of the partners to divide the profits among
principal, nominate, bilateral, onerous, and commutative. themselves. (Tocao v. CA)
(d) Test in determining existence of partnership (b) Personality Not Affected

Article 1769, NCC. In determining whether a partnership exists, (1) by the fact that it does not appear in a public instrument, even
these rules shall apply: if the capital is P3,000 or more;
(1) Except as provided by article 1825, persons who are not (2) nor by the fact that it is not recorded in the Securities and
partners as to each other are not partners as to third persons; Exchange Commission —failure to register the contract of
(2) Co-ownership or co-possession does not of itself establish a partnership does not affect the liability of the partnership and of the
partnership, whether such co-owners or co-possessors do or do partners to third persons. Neither does such failure to register affect
not share any profits made by the use of the property; the partnership’s juridical personality. (Angeles v. Sec. of Justice)
(3) The sharing of gross returns does not of itself establish a
partnership, whether or not the persons sharing them have a (c) Effect of Articles Kept Secret Among Members
joint or common right or interest in any property from which the Article 1775, NCC. Associations and societies, whose articles are
returns are derived; kept secret among the members, and wherein any one of the
(4) The receipt by a person of a share of the profits of a business is members may contract in his own name with third persons, shall have
prima facie evidence that he is a partner in the business, but no no juridical personality, and shall be governed by the provisions
such inference shall be drawn if such profits were received in relating to co-ownership.
payment:
(a) As a debt by installments or otherwise; If the articles of the association are kept secret among the members and
(b) As wages of an employee or rent to a landlord; wherein any one of the members may contract in his own name with
(c) As an annuity to a widow or representative of a deceased third persons:
partner; (1) as among the members themselves, such associations and
(d) As interest on a loan, though the amount of payment vary societies shall have no juridical personality and their members
with the profits of the business; shall be governed by the provisions relating to co-ownership
(e) As the consideration for the sale of a goodwill of a business (1775); and
or other property by installments or otherwise. (2) the absence of personality cannot, however, be invoked
against third persons for the purpose of exempting themselves
(1) Ordinarily, the best evidence of the existence of a partnership is the from complying with their obligations contracted pursuant to the
contract of partnership or the articles of partnership itself. stipulations kept secret among themselves.
(Heirs of Jose Lim v. Lim)
(a) Thus, as a rule, persons who are not partners as to each other (d) Effect If Object or Purpose is Unlawful
are not partners as to third persons. Article 1770[2], NCC. A partnership must have a lawful object or
(b) Exception: a partner by estoppel. purpose, and must be established for the common benefit or interest
(2) Co-ownership or co-possession does not of itself establish a of the partners.
partnership, whether such co-owners or co-possessors do or do
not share any profits made by the use of the property. When an unlawful partnership is dissolved by a judicial decree, the
(3) The sharing of gross returns does not of itself establish a profits shall be confiscated in favor of the State, without prejudice to
partnership, whether or not the persons sharing them have a joint the provisions of the Penal Code governing the confiscation of the
or common right or interest in any property from which the returns instruments and effects of a crime.
are derived.
The contract is void and the purported partners have no right to (1) Universal Partnership – where the contract of partnership
participate in any profits that may have been earned by the unlawful encompasses expressly or impliedly either all the present
partnership enterprise (Arbes v. Polistico), but the partners are entitled properties of the partners or just covering all of the profits; (1777)
to the return of their respective contributions. When an unlawful (2) Particular Partnership – one which has for its object determinate
partnership is dissolved by a judicial decree, the profits shall be things, their use or fruits, or a specific undertaking, or the exercise
confiscated in favor of the State. (1770[2]) of a profession or vocation. (1783)
(e) Partnership name (b) Two Kinds of Universal Partnership

Article 1815, NCC. Every partnership shall operate under a firm Article 1779, NCC. In a universal partnership of all present property,
name, which may or may not include the name of one or more of the the property which belonged to each of the partners at the time of the
partners. constitution of the partnership, becomes the common property of all
the partners, as well as all the profits which they may acquire
Those who, not being members of the partnership, include their therewith.
names in the firm name, shall be subject to the liability of a partner.
A stipulation for the common enjoyment of any other profits may also
 A partnership has the right to adopt any name it may choose. It be made; but the property which the partners may acquire
may or may not include the name of one or more partners (1815[1]). subsequently by inheritance, legacy, or donation cannot be included
 However, the use of the name of a deceased partner in the in such stipulation, except the fruits thereof.
partnership name is not allowed (In Re Sycip).
 In limited partnerships, the law requires that the word “limited” Article 1780, NCC. A universal partnership of profits comprises all
be included in the name of the partnership (1844[1]) that the partners may acquire by their industry or work during the
o The law prohibits a third person from including his name existence of the partnership.
in the firm name under pain of assuming the liability of a
partner. Thus, those who, not being members of the Movable or immovable property which each of the partners may
partnership, include their names in the firm name, shall be possess at the time of the celebration of the contract shall continue
subject to the liability of a partner. (1815[2]) to pertain exclusively to each, only the usufruct passing to the
partnership.
3. Requirement of Form
(1) Universal Partnership of All Present Property:
(a) Rule (a) shall include all properties of each partner at the time of
Article 1771, NCC. A partnership may be constituted in any form, constitution and profits that they may acquire therewith;
except where immovable property or real rights are contributed (1779)
thereto, in which case a public instrument shall be necessary. (b) but shall not include properties subsequently acquired by
A partnership may be constituted in any form. each partner thru inheritance, legacy, or donation, except
the fruits thereof. (1780)
(b) Exception (2) Universal Partnership of Profits
Article 1773, NCC. A contract of partnership is void, whenever (a) shall include properties that the partners may acquire by
immovable property is contributed thereto, if an inventory of said their industry or work during the existence of the
property is not made, signed by the parties, and attached to the public partnership;
instrument. (b) but shall not include movable or immovable property
which each of the partners may possess at the time of the
 A contract of partnership is void whenever immovable property celebration of the contract; however, the usufruct over such
is contributed thereto but an inventory of said property is not properties shall be included,
made, signed by the parties, and attached to the public instrument. (c) Presumption In Favor of Universal Partnership of Profits
(1773 IRT 1771) Article 1781, NCC. Articles of universal partnership, entered into
 However, such requirement is intended primarily to protect third without specification of its nature, only constitute a universal
persons. (Torres v. CA) Hence, when the case does not involve partnership of profits.
third parties who had been prejudiced, as when the action is
between the partners themselves, they cannot deny the If not specified in the articles, the partnership is deemed only a universal
existence of a partnership simply because of violation of partnership of profits.
Article 1773.
(d) Persons Prohibited From Entering Into Universal Partnerships
B. Classifications of Partnerships Article 1782, NCC. Persons who are prohibited from giving each
other any donation or advantage cannot enter into universal
1. As to Object or Purpose partnership.
(a) Classification Article 87, NCC. X

Article 1777, NCC. A universal partnership may refer to all the
present property or to all the profits. Persons who are prohibited from giving each other any donation or
advantage cannot enter into a universal partnership (1782), like the
Article 1783, NCC. A particular partnership has for its object spouses or those merely living together as husband and wife without the
determinate things, their use or fruits, or a specific undertaking, or benefit of marriage. (87 FC)
the exercise of a profession or vocation.
2. As to Extent of Partner’s Liability
(a) Classification
Article 1854, NCC. A limited partner also may loan money to and
(1) General Partnership transact other business with the partnership, and, unless he is also a
Article 1816, NCC. All partners, including industrial ones, shall be general partner, receive on account of resulting claims against the
liable pro rata with all their property and after all the partnership partnership, with general creditors, a pro rata share of the assets. No
assets have been exhausted, for the contracts which may be entered limited partner shall in respect to any such claim:
into in the name and for the account of the partnership, under its (1) Receive or hold as collateral security any partnership property,
signature and by a person authorized to act for the partnership. or
However, any partner may enter into a separate obligation to perform (2) Receive from a general partner or the partnership any payment,
a partnership contract. conveyance, or release from liability, if at the time the assets of
the partnership are not sufficient to discharge partnership
 one where all the partners are unlimitedly liable. liabilities to persons not claiming as general or limited partners.
 All partners shall be liable pro rata beyond the partnership
assets for all the contracts which may have been entered into in its The receiving of collateral security, or payment, conveyance, or
name, under its signature, and by a person authorized to act for the release in violation of the foregoing provisions is a fraud on the
partnership (1816). creditors of the partnership.
 In addition, the partners can be held solidarity liable with the
partnership specifically in the following instances: (1) as a rule, a limited partner does not become liable as a general
o where, by any wrongful act or omission of any partner partner to third persons (1848); however, he becomes liable as
acting in the ordinary course of the business of the a general partner if, in addition to the exercise of his rights and
partnership or with the authority of his co-partners, loss or powers as a limited partner, he takes part in the control of the
injury is caused to any person, not being a partner in the business.
partnership, or any penalty is incurred, the partnership is liable (2) he has no right to participate in the management of the firm’s
therefor to the same extent as the partner so acting or omitting business; otherwise, he becomes liable as a general partner;
to act; (3) when the surname of a limited partner appears in a partnership
o where one partner acting within the scope of his apparent name he becomes liable as general partner to partnership
authority receives money or property of a third person creditors who extend credit to the partnership without actual
and misapplies it; and knowledge that he is not a general partner, unless
o where the partnership in the course of its business (a) it is also the surname of a general partner, or
receives money or property of a third person and the (b) prior to the time when the limited partner became such, the
money or property so received is misapplied by any business had been carried on under the name in which his
partner while it is in the custody of the partnership— surname appeared (1846);
consistently with the rules on the nature of civil liability in (4) the partnership creditors enjoy preference compared to the
delicts and quasi-delicts. (J. Vitug, concurring in Lim Tong Lim limited and general partners in terms of payment from the
v. PH Fishing Gear Industries, Inc.) partnership property;
(5) a limited partner may also loan money to and transact other
(2) Limited Partnership business with the partnership, and, unless he is also a general
Article 1843, NCC. A limited partnership is one formed by two or partner, receive on account of resulting claims against the
more persons under the provisions of the following article, having as partnership, with general creditors, a pro rata share of the assets;
members one or more general partners and one or more limited (1854)
partners. The limited partners as such shall not be bound by the
obligations of the partnership. (c) Effects If He is Both General and Limited Partner
Article 1853, NCC. A person may be a general partner and a limited
where there is one or more general partners who is/are unlimitedly liable partner in the same partnership at the same time, provided that this
and one or more limited partners (1843), the latter liable for partnership fact shall be stated in the certificate provided for in article 1844.
debts only to the extent of their stipulated contributions under the articles
of partnership. A person who is a general, and also at the same time a limited
partner, shall have all the rights and powers and be subject to all the
(b) Effects of Being Limited Partner restrictions of a general partner; except that, in respect to his
Article 1848, NCC. A limited partner shall not become liable as a contribution, he shall have the rights against the other members
general partner unless, in addition to the exercise of his rights and which he would have had if he were not also a general partner.
powers as a limited partner, he takes part in the control of the
business. He shall have all the rights and powers and be subject to all the
restrictions of a general partner; except that, in respect to the return
Article 1846, NCC. The surname of a limited partner shall not appear of his contribution, he enjoys priority with respect to the return of his
in the partnership name unless: contributions as a limited partner. (1853)
(1) It is also the surname of a general partner, or C. Kind of Partners

(2) Prior to the time when the limited partner became such, the
business had been carried on under a name in which his 1. As to Extent of Liability
surname appeared.
(1) General Partner; or (2) Limited Partner. Discussed above.
A limited partner whose surname appears in a partnership name
contrary to the provisions of the first paragraph is liable as a general 2. As to Nature of Contributions
partner to partnership creditors who extend credit to the partnership
without actual knowledge that he is not a general partner. (a) Classification
(1) Capitalist Partner – one who contributes either money or (1) An industrial partner cannot engage in any kind of business
property to the common fund. Such contribution need not be for himself, unless the partnership expressly permits him to do so
cash or fixed assets; it could be an intangible like credit (Lim Tong (1789). If he does, the capitalist partners may either:
Lim), such as a promissory note or other evidence of obligation, or (a) exclude him from the partnership; or
even mere goodwill (City of Manila v. Cumbe); or (b) avail themselves of the benefits which he may have obtained
(2) Industrial Partner – one who contributes only his industry. in violation of the prohibition, with a right to damages in either
case.
(b) Effects of Being a Capitalist Partner (2) As to the distribution of the profits and losses, an industrial partner
Article 1808, NCC. The capitalist partners cannot engage for their shall not be liable for the losses. (1797[2])
own account in any operation which is of the kind of business in which (3) In case of imminent loss of the business of the partnership and
the partnership is engaged, unless there is a stipulation to the there is a need for additional capital contribution to save the
contrary. venture, an industrial partner cannot be compelled to make such
additional contribution. (1791)
Any capitalist partner violating this prohibition shall bring to the
common funds any profits accruing to him from his transactions, and 3. As to Time of Entry
shall personally bear all the losses.
(a) Classification
Article 1797[2], NCC. The losses and profits shall be distributed in (1) Original Partner – one who became as such at the time of the
conformity with the agreement. If only the share of each partner in constitution of the partnership; and
the profits has been agreed upon, the share of each in the losses (2) Incoming Partner – one who became as such as a new member of
shall be in the same proportion. an existing partnership
In the absence of stipulation, the share of each partner in the profits (b) Liability of Incoming Partner
and losses shall be in proportion to what he may have contributed, Article 1826, NCC. A person admitted as a partner into an existing
but the industrial partner shall not be liable for the losses. As for the partnership is liable for all the obligations of the partnership arising
profits, the industrial partner shall receive such share as may be just before his admission as though he had been a partner when such
and equitable under the circumstances. If besides his services he has obligations were incurred, except that this liability shall be satisfied
contributed capital, he shall also receive a share in the profits in only out of partnership property, unless there is a stipulation to the
proportion to his capital. contrary.
Article 1799, NCC. A stipulation which excludes one or more As to old obligations of the partnership, or obligations incurred prior to
partners from any share in the profits or losses is void. his admission to the partnership, he is liable thereto as though he had
been a partner when such obligations were incurred. However, his
Article 1791, NCC. If there is no agreement to the contrary, in case liability shall be satisfied only out of partnership property, unless there is
of an imminent loss of the business of the partnership, any partner a stipulation to the contrary.
who refuses to contribute an additional share to the capital, except
an industrial partner, to save the venture, shall be obliged to sell his 4. Other Classifications
interest to the other partners.
(a) Managing Partner
(1) A capitalist partner cannot engage for his own account in any Article 1800, NCC. The partner who has been appointed manager
operation or business which is of the same nature as that of in the articles of partnership may execute all acts of administration
the partnership, unless there is a stipulation to the contrary despite the opposition of his partners, unless he should act in bad
(1808[1]). If he does, he shall bring to the common funds any profits faith; and his power is irrevocable without just or lawful cause. The
accruing to him from his transactions; but he shall personally bear vote of the partners representing the controlling interest shall be
all the losses. But this is not a ground to exclude him from the necessary for such revocation of power.
partnership.
(2) In the absence of any agreement as to the distribution of the profits A power granted after the partnership has been constituted may be
and losses, the capitalist partner is liable for the losses in the revoked at any time.
same proportion to what he may have contributed (1797[2])
and any stipulation to the contrary shall be void. (1799) Article 1801, NCC. If two or more partners have been intrusted with
(3) In case of imminent loss of the business of the partnership and the management of the partnership without specification of their
there is a need for additional capital contribution to save the respective duties, or without a stipulation that one of them shall not
venture, the capitalist partner can be compelled to make such act without the consent of all the others, each one may separately
additional contribution (1791). Any partner who refuses to execute all acts of administration, but if any of them should oppose
contribute shall be obliged to sell his interest to the other partners, the acts of the others, the decision of the majority shall prevail. In
except if there is an agreement to the contrary. case of a tie, the matter shall be decided by the partners owning the
controlling interest.
(c) Effects of Being Industrial Partner
Article 1789, NCC. An industrial partner cannot engage in business Article 1802, NCC. In case it should have been stipulated that none
for himself, unless the partnership expressly permits him to do so; of the managing partners shall act without the consent of the others,
and if he should do so, the capitalist partners may either exclude him the concurrence of all shall be necessary for the validity of the acts,
from the firm or avail themselves of the benefits which he may have and the absence or disability of any one of them cannot be alleged,
obtained in violation of this provision, with a right to damages in either unless there is imminent danger of grave or irreparable injury to the
case. partnership.
Article 1803, NCC. When the manner of management has not been The liability of a partner under the first paragraph, No. 2, shall be
agreed upon, the following rules shall be observed: satisfied out of partnership assets alone when such partner had been
(1) All the partners shall be considered agents and whatever any prior to dissolution:
one of them may do alone shall bind the partnership, without (1) Unknown as a partner to the person with whom the contract is
prejudice to the provisions of article 1801. made; and
(2) None of the partners may, without the consent of the others, (2) So far unknown and inactive in partnership affairs that the
make any important alteration in the immovable property of the business reputation of the partnership could not be said to have
partnership, even if it may be useful to the partnership. But if the been in any degree due to his connection with it.
refusal of consent by the other partners is manifestly prejudicial The partnership is in no case bound by any act of a partner after
to the interest of the partnership, the court’s intervention may be dissolution:
sought. (1) Where the partnership is dissolved because it is unlawful to
carry on the business, unless the act is appropriate for winding
(1) Definition: One who has been entrusted with the management of up partnership affairs; or
the partnership. (1800, 1801) (2) Where the partner has become insolvent; or ewIisi
(2) Rule as to management (3) Where the partner has no authority to wind up partnership
(a) when the manner of management has not been agreed affairs; except by a transaction with one who —
upon, all the partners shall be considered agents and (a) Had extended credit to the partnership prior to dissolution
(i) whatever any one of them may do alone shall bind and had no knowledge or notice of his want of authority; or
the partnership; (b) Had not extended credit to the partnership prior to
(ii) but none may, without the consent of the others, dissolution, and, having no knowledge or notice of his want
make any important alteration in the immovable of authority, the fact of his want of authority has not been
property of the partnership, even if it may be useful to advertised in the manner provided for advertising the fact
the partnership (1803); of dissolution in the first paragraph, No. 2 (b).
(b) when a partner has been appointed manager, he may
execute all acts of administration despite the opposition Nothing in this article shall affect the liability under article 1825 of any
of his partners unless he should act in bad faith— person who after dissolution represents himself or consents to
(i) if his appointment is made in the articles of another representing him as a partner in a partnership engaged in
incorporation, his power is irrevocable without just or carrying on business.
lawful cause and the vote of the partners representing
the controlling interest shall be necessary for such One whose connection to the partnership is concealed and who does
revocation of power, not take any active part in it. (1834 [2])
(ii) but if his power was granted only after the partnership
has been constituted, it may be revoked at any time. (2) Effect of Being Dormant or Silent Partner
(1800) Article 1835, NCC. The dissolution of the partnership does not of
(c) if two or more partners have been entrusted with the itself discharge the existing liability of any partner.
management of the partnership and there is no agreement to
the contrary, each one may separately execute all acts of A partner is discharged from any existing liability upon dissolution of
administration, but if any of them should oppose the acts the partnership by an agreement to that effect between himself, the
of the others, the decision of the majority shall prevail partnership creditor and the person or partnership continuing the
and, in case of a tie, the decision of the partners owning the business; and such agreement may be inferred from the course of
controlling interest shall be necessary (1801); dealing between the creditor having knowledge of the dissolution and
(d) in case it should have been stipulated that none of the the person or partnership continuing the business.
managing partners shall act without the consent of the
others, the concurrence of all shall be necessary for the The individual property of a deceased partner shall be liable for all
validity of the acts. (1802) obligations of the partnership incurred while he was a partner, but
subject to the prior payment of his separate debts.
(b) Dormant/Silent/Secret Partner
(1) Definition: (a) the dissolution of the partnership does not of itself
Article 1834, NCC. After dissolution, a partner can bind the discharge the existing liability of any partner (1835[1]),
partnership, except as provided in the third paragraph of this article: including the unknown or dormant partner;
(1) By any act appropriate for winding up partnership affairs or (b) but with respect to obligations incurred by the partnership
completing transactions unfinished at dissolution; after its dissolution, the liability of the unknown or
(2) By any transaction which would bind the partnership if dormant partner shall be satisfied out of partnership
dissolution had not taken place, provided the other party to the assets alone (1834[2]) —his liability thereto is only up to the
transaction: extent of his share in the partnership assets.
(a) Had extended credit to the partnership prior to dissolution
and had no knowledge or notice of the dissolution; or (c) Liquidating Partner
(b) Though he had not so extended credit, had nevertheless (1) Definition
known of the partnership prior to dissolution, and, having Article 1836, NCC. Unless otherwise agreed, the partners who have
no knowledge or notice of dissolution, the fact of not wrongfully dissolved the partnership or the legal representative of
dissolution had not been advertised in a newspaper of the last surviving partner, not insolvent, has the right to wind up the
general circulation in the place (or in each place if more partnership affairs, provided, however, that any partner, his legal
than one) at which the partnership business was regularly representative or his assignee, upon cause shown, may obtain
carried on. winding up by the court.
One who takes charge of the liquidation and winding up of the representation. When all the members of the existing partnership
partnership affairs. (1836) consent to the representation, a partnership act or obligation results;
but in all other cases it is the joint act or obligation of the person acting
(2) Rule as to Who Has Right to Wind Up and the persons consenting to the representation.
(a) if there is an agreement, it is the partner provided in the
agreement who has the right to wind up the partnership  Definition: Although not an actual partner, he has made himself
affairs; he is called “liquidating partner”; (1836) liable as such by holding himself out as a partner or allowing
(b) in the absence of agreement, the partners who have not himself to be so held out. (1825[1])
wrongfully dissolved the partnership or the legal  Effect of Acts Executed by Partner by Estoppel
representative of the last surviving partner, not insolvent, o when all the members of existing partnership consent to the
has the right to wind up the partnership affairs. representation, a partnership act or obligation results
(1825[2]) —and all shall be liable, including the partner by
(3) Effect of Acts of Partner Who Has No Authority to Wind Up estoppel as though he were an actual member of the
partnership; (1825[1])
Rule: the partnership is not bound by any of his acts; (1834[3, no. 3]) o when less than all the partners consent to such
EXC: the partnership is bound by his acts if he transacted with one who representation, no partnership obligation is created; instead,
had extended credit to the partnership prior to dissolution and had no it shall be considered the joint act or obligation of the person
knowledge or notice of his want of authority or with one who has no acting and the persons consenting to the representation
knowledge or notice of his want of authority because the fact of his want (1825[2]) —and each shall be liable pro rata.
of authority has not been advertised in a newspaper of general
circulation in the place (or in each place if more than one) at which the D. Obligations of Partners
partnership business was regularly carried on.
1. Other Obligations Among Themselves Aside from Those
(4) Retiring and Continuing Partners Already Discussed
(a) Definition
In case the business of the partnership is continued after its dissolution, (a) Personal Use of Partnership Money
those who remain in the partnership are referred to as the “continuing When a partner uses partnership money for his personal use, he
partners,” whereas, those who cease to be part of the partnership are becomes a debtor for the interest and damages (1788[2]), without
referred to as “retiring partners. (1837, 1839, 1840, 1841) need of demand. His liability for interest and damages shall begin from
the time he converted the amount to his own use.
(b) Liability of Retiring Partner
 As to existing obligations upon dissolution, he remains liable (b) Individual Transaction Using Firm’s Property or Connected
(1835[2]); with Partnership Affairs
o unless there is an agreement that he shall no longer be liable
between himself, the partnership creditor and the person or Article 1807, NCC. Every partner must account to the partnership for
partnership continuing the business; any benefit, and hold as trustee for it any profits derived by him
o if the agreement is only among the partners themselves, such without the consent of the other partners from any transaction
agreement is binding upon them but this does not relieve the connected with the formation, conduct, or liquidation of the
retiring partner from liability to the partnership creditors; partnership or from any use by him of its property.
 as to subsequent obligations, he is no longer liable provided
he has given the necessary notice of withdrawal. Every partner must account to the partnership for any benefit derived by
him without the consent of the other partners from any transaction
(5) Partner by Estoppel connected with the formation, conduct, or liquidation of the partnership
Article 1825, NCC. When a person, by words spoken or written or or from any use by him of its property. (1807) He holds any such profit
by conduct, represents himself, or consents to another representing as trustee.
him to anyone, as a partner in an existing partnership or with one or
more persons not actual partners, he is liable to any such persons to (c) When Managing Partner Collects Personal Credit and Firm’s
whom such representation has been made, who has, on the faith of Credit
such representation, given credit to the actual or apparent Article 1792, NCC. If a partner authorized to manage collects a
partnership, and if he has made such representation or consented to demandable sum, which was owed to him in his own name, from a
its being made in a public manner he is liable to such person, whether person who owed the partnership another sum also demandable, the
the representation has or has not been made or communicated to sum thus collected shall be applied to the two credits in proportion to
such person so giving credit by or with the knowledge of the apparent their amounts, even though he may have given a receipt for his own
partner making the representation or consenting to its being made: credit only; but should he have given it for the account of the
partnership credit, the amount shall be fully applied to the latter.
(1) When a partnership liability results, he is liable as though he
were an actual member of the partnership; The provisions of this article are understood to be without prejudice
(2) When no partnership liability results, he is liable pro rata with to the right granted to the debtor by article 1252, but only if the
the other persons, if any, so consenting to the contract or personal credit of the partner should be more onerous to him.
representation as to incur liability, otherwise separately.
When a managing partner collects a credit from a debtor who owes him
When a person has been thus represented to be a partner in an in his own name and the partnership, and both debts being demandable,
existing partnership, or with one or more persons not actual partners, the sum thus collected shall be applied to the two credits in proportion
he is an agent of the persons consenting to such representation to to their amounts, even though the managing partner may have given
bind them to the same extent and in the same manner as though he receipt for his own credit only; but should he have given it for the account
were a partner in fact, with respect to persons who rely upon the
of the partnership credit, the amount shall be fully applied to the latter.  EXC: The act binds the partnership when such partner has been
(1792[1]) authorized by the other partners with respect to that particular
matter.
(d) Damages Suffered by Partnership Thru His Fault
Article 1794, NCC. Every partner is responsible to the partnership (c) Acts Requiring Concurrence of All Partners (1818[3])
for damages suffered by it through his fault, and he cannot (1) assigning of partnership property in trust for creditors or on
compensate them with the profits and benefits which he may have the assignee’s promise to pay the debts of the partnership;
earned for the partnership by his industry. However, the courts may (2) disposition of the goodwill of the business;
equitably lessen this responsibility if through the partner’s (3) doing any other act which would make it impossible to carry on the
extraordinary efforts in other activities of the partnership, unusual ordinary business of a partnership;
profits have been realized. (4) confession of a judgment;
(5) entering into a compromise concerning a partnership claim or
Every partner is responsible to the partnership for damages liability;
suffered by it through his fault and he cannot compensate his (6) submitting a partnership claim or liability to arbitration; and
liability with the profits and benefits which he may have earned for (7) renouncing a partnership claim.
the partnership by his industry. (1794) However, the courts may
equitably lessen the foregoing responsibility if through the partner’s (d) Admission Made by a Partner
extraordinary efforts in other activities of the partnership, unusual profits Article 1820, NCC. An admission or representation made by any
have been realized. partner concerning partnership affairs within the scope of his
authority in accordance with this Title is evidence against the
2. Obligations to Third Persons partnership.
(a) Binding the Partnership Article 1834, NCC. After dissolution, a partner can bind the
(1) GR: Acts of every partner bind the partnership provided that: (i) the partnership, except as provided in the third paragraph of this article:
act is for apparently carrying on in the usual way the business of (1) By any act appropriate for winding up partnership affairs or
the partnership of which he is a member; and (ii) he acts in the completing transactions unfinished at dissolution;
name of the partnership.36* (2) By any transaction which would bind the partnership if
(2) EXC: the act does not bind the partnership when: (i) the partner so dissolution had not taken place, provided the other party to the
acting has in fact no authority to act for the partnership in the transaction:
particular matter; and (ii) the person with whom he is dealing has (a) Had extended credit to the partnership prior to dissolution
knowledge of the fact that he has no such authority.365 and had no knowledge or notice of the dissolution; or
(b) Though he had not so extended credit, had nevertheless
(b) When Act is Not Apparently for Carrying on Partnership known of the partnership prior to dissolution, and, having
Business no knowledge or notice of dissolution, the fact of
Article 1818, NCC. Every partner is an agent of the partnership for dissolution had not been advertised in a newspaper of
the purpose of its business, and the act of every partner, including general circulation in the place (or in each place if more
the execution in the partnership name of any instrument, for than one) at which the partnership business was regularly
apparently carrying on in the usual way the business of the carried on.
partnership of which he is a member binds the partnership, unless
the partner so acting has in fact no authority to act for the partnership The liability of a partner under the first paragraph, No. 2, shall be
in the particular matter, and the person with whom he is dealing has satisfied out of partnership assets alone when such partner had been
knowledge of the fact that he has no such authority. prior to dissolution:
(1) Unknown as a partner to the person with whom the contract is
An act of a partner which is not apparently for the carrying on of made; and
business of the partnership in the usual way does not bind the (2) So far unknown and inactive in partnership affairs that the
partnership unless authorized by the other partners. business reputation of the partnership could not be said to have
been in any degree due to his connection with it.
Except when authorized by the other partners or unless they have The partnership is in no case bound by any act of a partner after
abandoned the business, one or more but less than all the partners dissolution:
have no authority to: (1) Where the partnership is dissolved because it is unlawful to
(1) Assign the partnership property in trust for creditors or on the carry on the business, unless the act is appropriate for winding
assignee’s promise to pay the debts of the partnership; up partnership affairs; or
(2) Dispose of the good-will of the business; (2) Where the partner has become insolvent; or ewIisi
(3) Do any other act which would make it impossible to carry on the (3) Where the partner has no authority to wind up partnership
ordinary business of a partnership; affairs; except by a transaction with one who —
(4) Confess a judgment; (a) Had extended credit to the partnership prior to dissolution
(5) Enter into a compromise concerning a partnership claim or and had no knowledge or notice of his want of authority; or
liability; meiriw (b) Had not extended credit to the partnership prior to
(6) Submit a partnership claim or liability to arbitration; dissolution, and, having no knowledge or notice of his want
(7) Renounce a claim of the partnership. of authority, the fact of his want of authority has not been
advertised in the manner provided for advertising the fact
No act of a partner in contravention of a restriction on authority shall of dissolution in the first paragraph, No. 2 (b).
bind the partnership to persons having knowledge of the restriction.
Nothing in this article shall affect the liability under article 1825 of any
 GR: The act does not bind the partnership. (1818[2]) person who after dissolution represents himself or consents to
another representing him as a partner in a partnership engaged in Article 1816, NCC. All partners, including industrial ones, shall be
carrying on business. liable pro rata with all their property and after all the partnership
assets have been exhausted, for the contracts which may be entered
 Made Before Dissolution: It binds the partnership when: into in the name and for the account of the partnership, under its
o it concerns partnership affairs, and signature and by a person authorized to act for the partnership.
o it is within the scope of his authority. (1820) However, any partner may enter into a separate obligation to perform
 Made After Dissolution: It binds the partnership only if it is a partnership contract.
necessary for the winding up of partnership affairs. (1834)
All partners, including industrial ones, shall be liable pro rata (not
(e) Notice to Partner: solidarity) with all their property and after all the partnership assets have
Article 1821, NCC. Notice to any partner of any matter relating to been exhausted (1816). The individual liability of the partners for
partnership affairs, and the knowledge of the partner acting in the partnership debts is secondary, their individual assets becoming
particular matter, acquired while a partner or then present to his mind, answerable only where there are no firm assets or after they have
and the knowledge of any other partner who reasonably could and become exhausted.
should have communicated it to the acting partner, operate as notice
to or knowledge of the partnership, except in the case of a fraud on For Consenting to Acts of a Partner by Estoppel
the partnership, committed by or with the consent of that partner.  when all partners consented, partnership liability results (1825[2]);
hence, all partners shall be liable pro rata (not solidarity) with all
 Rule: It operates as notice to the partnership when: their property and after all the partnership assets have been
o it is notice to any partner relating to partnership affairs; exhausted; (1816)
o upon knowledge of the partner acting in the particular matter,  when not all consented, those who consented shall be liable merely
acquired while a partner or then present to his mind; or as joint debtors, pro rata.
o upon knowledge of any other partner who reasonably could
and should have communicated it to the acting partner. As to the partner by estoppel:
 EXC: It does not operate as notice to the partnership when the  when all partners consented, he is also liable as though he were
same is a case of fraud on the partnership, committed by or with an actual member of the partnership;’”
the consent of that partner.’"  when not all consented, he is liable pro rata with the other partners
so consenting. (1825[2])
(f) For Delicts or Quasi-Delicts Committed by a Partner
Article 1822, NCC. Where, by any wrongful act or omission of any E. Dissolution and Winding Up
partner acting in the ordinary course of the business of the
partnership or with the authority of his co-partners, loss or injury is 1. Causes for Dissolution without Violation of Agreement
caused to any person, not being a partner in the partnership, or any
penalty is incurred, the partnership is liable therefor to the same Article 1830, NCC. Dissolution is caused:
extent as the partner so acting or omitting to act. (1) Without violation of the agreement between the partners:
(a) By the termination of the definite term or particular
The partnership becomes liable to the same extent as the partner so undertaking specified in the agreement;
acting or omitting to act when: (b) By the express will of any partner, who must act in good
 it is committed by a partner acting in the ordinary course of the faith, when no definite term or particular undertaking is
business of the partnership; or specified;
 with the authority of his co-partners. (c) By the express will of all the partners who have not
assigned their interests or suffered them to be charged for
(g) For Acts of Conversion or Misappropriation: their separate debts, either before or after the termination
Article 1823, NCC. The partnership is bound to make good the loss: of any specified term or particular undertaking;
(1) Where one partner acting within the scope of his apparent (d) By the expulsion of any partner from the business bona
authority receives money or property of a third person and fide in accordance with such a power conferred by the
misapplies it; and agreement between the partners;
(2) Where the partnership in the course of its business receives (2) In contravention of the agreement between the partners, where
money or property of a third person and the money or property the circumstances do not permit a dissolution under any other
so received is misapplied by any partner while it is in the custody provision of this article, by the express will of any partner at any
of the partnership. time;
(3) By any event which makes it unlawful for the business of the
The partnership is liable for an act of conversion or misappropriation partnership to be carried on or for the members to carry it on in
committed by a partner in the following cases: partnership;
(4) When a specific thing, which a partner had promised to
 where the partner who received and misapplied the money or
contribute to the partnership, perishes before the delivery; in
property of a third person acted within the scope of his apparent
any case by the loss of the thing, when the partner who
authority; or
contributed it having reserved the ownership thereof, has only
 where the money or property of a third person was received by the
transferred to the partnership the use or enjoyment of the same;
partnership in the course of its business and it was misapplied by
but the partnership shall not be dissolved by the loss of the thing
any partner while it was in the custody of the partnership.
when it occurs after the partnership has acquired the ownership
thereof;
3. Individual Liability for Partnership Obligations
(5) By the death of any partner;
(6) By the insolvency of any partner or of the partnership;
For Obligations Arising From Contracts
(7) By the civil interdiction of any partner;
(8) By decree of court under the following article.
(2) The partners who have not caused the dissolution wrongfully, if
(a) Termination of the definite term or particular undertaking they all desire to continue the business in the same name either
specified in the agreement (1830[1a]) by themselves or jointly with others, may do so, during the
the dissolution does not give rise to any liability for damages and none agreed term for the partnership and for that purpose may
of the partners shall be disqualified to participate in the winding up of the possess the partnership property, provided they secure the
affairs of the partnership; payment by bond approved by the court, or pay any partner who
has caused the dissolution wrongfully, the value of his interest
(b) Express will of any partner in a partnership at will acting in in the partnership at the dissolution, less any damages
good faith (1830[1b]) recoverable under the second paragraph, No. 1 (b) of this
(1) Definition of Partnership At Will: If the partnership has no article, and in like manner indemnify him against all present or
fixed term or no particular undertaking is specified in the future partnership liabilities.
agreement, it is therefore a partnership at will predicated (3) A partner who has caused the dissolution wrongfully shall have:
on their mutual desire and consent, and it may be (a) If the business is not continued under the provisions of the
dissolved by the will of a partner. (Tocao v. CA) second paragraph, No. 2, all the rights of a partner under
(2) Effect of Good Faith: If the partnership is a partnership at the first paragraph, subject to liability for damages in the
will, it can be dissolved whether acting in good faith or in second paragraph, No. 1 (b), of this article.
bad faith. (b) If the business is continued under the second paragraph,
(i) If he acts in good faith, he does not become liable for No. 2, of this article, the right as against his co-partners
resulting damages to the firm or his co-partners. and all claiming through them in respect of their interests
(ii) But if he acts in bad faith, he becomes answerable for in the partnership, to have the value of his interest in the
the losses caused by the dissolution. partnership, less any damage caused to his co-partners by
(c) Express Will of All Partners (1830[1c] the dissolution, ascertained and paid to him in cash, or the
(1) the partnership can be dissolved at any time, even before the payment secured by a bond approved by the court, and to
expiration of the term agreed upon or the completion of its be released from all existing liabilities of the partnership;
particular undertaking; and but in ascertaining the value of the partner’s interest the
(2) none of the partners shall be liable for damages and none value of the good-will of the business shall not be
shall be disqualified to participate in the winding up of the considered.
affairs of the partnership,
(1) It is necessary that the power of expulsion is conferred by the
(d) Expulsion of Any Partner Bona fide (1830[1d]) agreement between the partners and is exercised in good
Article 1789, NCC. An industrial partner cannot engage in business faith; otherwise, the expulsion is not valid;
for himself, unless the partnership expressly permits him to do so; (2) if the expulsion is valid, the expelled partner has no right to
and if he should do so, the capitalist partners may either exclude him wind up the affairs of the partnership (1836) or to elect to
from the firm or avail themselves of the benefits which he may have continue the business of the partnership (1837[2 no. 2]).
obtained in violation of this provision, with a right to damages in either (i) Note that in the absence of an express agreement,
case. there is no right to expel any member, except in the
case of an industrial partner who engages in
Article 1836, NCC. Unless otherwise agreed, the partners who have business for himself without express permission
not wrongfully dissolved the partnership or the legal representative of from the partnership. (1789)
the last surviving partner, not insolvent, has the right to wind up the
partnership affairs, provided, however, that any partner, his legal 2. Causes for Dissolution in Violation of Agreement
representative or his assignee, upon cause shown, may obtain
winding up by the court.  Among partners, mutual agency arises and the doctrine of delectus
personae allows them to have the power, although not necessarily
Article 1837, NCC. When dissolution is caused in any way, except the right, to dissolve the partnership (Ortega v. CA).
in contravention of the partnership agreement, each partner, as  However, an unjustified dissolution by the partner can subject him
against his co-partners and all persons claiming through them in to a possible action for damages.
respect of their interests in the partnership, unless otherwise agreed,
may have the partnership property applied to discharge its liabilities, 3. Causes for Dissolution by Operation of Law
and the surplus applied to pay in cash the net amount owing to the
respective partners. But if dissolution is caused by expulsion of a (a) Partnership Becomes Unlawful: It refers to any event which
partner, bona fide under the partnership agreement and if the makes it unlawful for the business of the partnership to be carried
expelled partner is discharged from all partnership liabilities, either on or for the members to carry it on in partnership. (1830[2])
by payment or agreement under the second paragraph of article (b) Loss of Specific Thing: In the following cases
1835, he shall receive in cash only the net amount due him from the (1) the specific thing which a partner had promised to contribute
partnership. to the partnership perished before the delivery; or
(2) loss of the thing before or after delivery, when the partner who
When dissolution is caused in contravention of the partnership contributed it having reserved ownership thereof, has only
agreement the rights of the partners shall be as follows: transferred to the partnership the use or enjoyment of the
(1) Each partner who has not caused dissolution wrongfully shall same (1830[4]). But the partnership is not dissolved by the
have: loss of the thing when it occurs after the partnership has
(a) All the rights specified in the first paragraph of this article, acquired the ownership thereof.
and
(b) The right, as against each partner who has caused the (c) Death of Any Partner (1830[5])
dissolution wrongfully, to damages for breach of the
agreement. cdasia
The individual property of a deceased partner shall be liable for all (1) The dissolution being by act of any partner, the partner acting
obligations of the partnership incurred while he was a partner, but for the partnership had knowledge of the dissolution; or
subject to the prior payment of his separate debts. (1835[3]) (2) The dissolution being by the death or insolvency of a partner,
the partner acting for the partnership had knowledge or notice
(d) Insolvency of Any Partner (1830[6]) and of the death or insolvency.
(e) Civil Interdiction of Any Partner (1830[7])
GR: The dissolution terminates all authority of any partner to act for the
4. Discussion Caused by Decree of Court partnership. (1832[1]) Hence, the right of a partner to bind the
partnership to new contracts or obligations (or new business) is
(a) On Application By or For a Partner: In the following instances terminated upon dissolution.
(1831[1])
(1) a partner has been declared insane in any judicial proceeding or is EXC:
shown to be of unsound mind;  if the act is necessary to wind up partnership affairs;
(2) a partner becomes in any other way incapable of performing his  if the act is to complete transactions begun but not then
part of the partnership contract; finished; or
(3) a partner has been guilty of such conduct as tends to affect  if the dissolution is caused by the act, death, or insolvency of a
prejudicially the carrying on of the business; partner, each partner is liable to his co-partners for his share
(4) a partner willfully or persistently commits a breach of the of any liability created by any partner acting for the
partnership agreement, or otherwise so conducts himself in matters partnership in relation to “new businesses” as if the partnership
relating to the partnership business that it is not reasonably had not been dissolved, unless
practicable to carry on the business in partnership with him; o the dissolution being by act of any partner, the partner acting
(5) the business of the partnership can only be carried on at a loss; or for the partnership (who makes new contracts or obligations)
(6) other circumstances that may render a dissolution equitable. had knowledge of the dissolution; or
o the dissolution being by the death or insolvency of a partner,
(b) At Instance of Purchaser of Partner’s Interest (1831[2]) the partner acting for the partnership (who makes new
In the following cases: contracts or obligations) had knowledge or notice of the death
(1) after the termination of the specified term or particular undertaking; or insolvency. (1833)
or
(2) at any time if the partnership was a partnership at will when the (d) Effect on Authority to Act for Partnership as to Third Persons
interest was assigned or when the charging order was issued. A partner can bind the partnership with respect to third persons:
(1) by any act appropriate for winding up partnership affairs or
5. Effects of Dissolution completing transactions unfinished at dissolution; (1834[1 no. 1])
(2) by any transaction which would bind the partnership if dissolution
(a) On Existence of Partnership had not taken place provided that the other party to the transaction
On dissolution, the partnership is not terminated but continues until the (third person):
winding up of partnership affairs is completed (1825). Stated otherwise, (a) had extended credit to the partnership prior to dissolution and
upon its dissolution, the partnership continues and its legal personality had no knowledge or notice of the dissolution; or
is retained until the complete winding up of its business culminating in (b) though he had not so extended credit, had nevertheless
its termination. (Ortega v. CA) known of the partnership prior to dissolution, and, having no
knowledge or notice of dissolution, the fact of dissolution had
(b) Effect on Existing Liability of Any Partner not been advertised in a newspaper of general circulation in
 Rule: The dissolution of the partnership does not of itself discharge the place (or in each place if more than one) at which the
the existing liability of any partner. (1835[1]) partnership business was regularly carried on. (1834[1 no. 2])
 EXC: A partner is discharged from any existing liability upon
dissolution by an agreement to that effect between himself, the (e) When Partnership Not Liable for Any Act of Partner After
partnership creditor, and the person or partnership continuing the Dissolution
business. (1835[2]) (1) where partnership is dissolved because it is unlawful to carry on
the business, unless the act is appropriate for winding up
(c) Effect on Authority to Act for Partnership as Between Partners partnership affairs;
Article 1832, NCC. xcept so far as may be necessary to wind up (2) where the partner has become insolvent; or
partnership affairs or to complete transactions begun but not then (3) where the partner has no authority to wind up partnership affairs;
finished, dissolution terminates all authority of any partner to act for except by a transaction with a third person who:
the partnership: (a) had extended credit to a partnership prior to dissolution and
(1) With respect to the partners, had no knowledge or notice of his want of authority; or
(a) When the dissolution is not by the act, insolvency or death (b) had not extended credit to the partnership prior to dissolution,
of a partner; or and, having no knowledge or notice of his want of authority,
(b) When the dissolution is by such act, insolvency or death of the fact of his want of authority has not been advertised in a
a partner, in cases where article 1833 so requires; newspaper of general circulation in the place (or in each place
(2) With respect to persons not partners, as declared in article if more than one) at which the partnership business was
1834. regularly carried on.
Article 1833, NCC. Where the dissolution is caused by the act, death
or insolvency of a partner, each partner is liable to his co-partners for
his share of any liability created by any partner acting for the
partnership as if the partnership had not been dissolved unless:
PART 5: CONTRACT OF AGENCY rule is that what a man may do in person he may do through another.
(Philpotts v. PH Manufacturing Co.)
A. Nature of Contract EXC
 peculiarly personal acts may not be delegated; and
1. Concept  illegal or unlawful acts may not be validly delegated.
(a) Definition B. Creation and Existence of Agency
Article 1868, NCC. By the contract of agency a person binds himself 1. Classification of Agency
to render some service or to do something in representation or on Article 1876, NCC. An agency is either general or special.
behalf of another, with the consent or authority of the latter.
The former comprises all the business of the principal. The latter, one
 By the contract of agency a person (called the “agent”) binds or more specific transactions.
himself to render some service or to do something in
representation or on behalf of another (called the “principal”), Article 1877, NCC. An agency couched in general terms comprises
with the consent or authority of the latter (1868). only acts of administration, even if the principal should state that he
 The essence of agency is representation. For a contract of withholds no power or that the agent may execute such acts as he
agency to exist, it is essential that the principal consents that the may consider appropriate, or even though the agency should
other party, the agent, shall act on its behalf, and the agent authorize a general and unlimited management.
consents so as to act (Apex Mining Co., Inc. v. Southeast Mindanao
Gold Mining Corp.).
 The most characteristic feature of an agency relationship is the (a) As to Manner of Creation
agent’s power to bring about business relations between his (1) Actual Agency - an agent-principal relationship actually
principal and third persons. (Nielson & Co. v. Lepanto exists and consent was given; or
Consolidated) (2) Apparent or Ostensible Agency (Agency By Estoppel) -
where the agency is not the result of consent but by the
(b) Elements actions of a principal or an employer in somehow misleading
(1) consent, express or implied, of the parties to establish the the public into believing that the relationship or the authority
relationship; exists. (Sargasso Construction v. PPA)
(2) object is the execution of a juridical act in relation to a third (b) As to Quantity of Transactions
person; (1) General Agency - it comprises all the business of the
(3) agent acts as a representative and not for himself; and principal; (1876[2]) or
(4) agent acts within the scope of his authority. (Yu Eng Cho v. Pan (2) Special Agency - it comprises one or more specific
American World Airways, Inc.) transactions.
(c) As to Nature of Acts Authorized
(c) Distinguished from Other Relations (1) Agency Couched in General Terms - it comprises only acts
From Assignment of administration, even if the principal should state that he
Agency Assignment withholds no power or that the agent may execute such acts
agent acts not on  there is total transfer or relinquishment of as he may consider appropriate, or even though the agency
his own behalf right by the assignor to the assignee should authorize a general and unlimited management;
but on behalf of  The assignee takes the place of the (1877) or
his principal. assignor and is no longer bound to the (2) Agency Couched in Specific or Explicit Terms - it indicates
latter the particular function or functions which the agent is
(Apex Mining) authorized to exercise, whether the same be acts of
administration or acts of dominion.
From Lease of Service
Agency Lease of Service 2. Conferment of Mandate in Actual Agency
the basis is representation Employment
the agent exercises the lessee ordinarily performs (a) How Made
discretionary powers only ministerial functions Article 1869, NCC. Agency may be express, or implied from the acts
(Nielson) of the principal, from his silence or lack of action, or his failure to
three persons are involved: the only two persons are involved: repudiate the agency, knowing that another person is acting on his
principal, the agent, and the third the lessor (master or employer) behalf without authority.
persons with whom the agent and the lessee (servant or
has contracted employee), Agency may be oral, unless the law requires a specific form.
(d) Characteristics of Contract It may be made expressly or impliedly. It may also be given orally, unless
Agency is preparatory, consensual, nominate, bilateral, and generally the law requires a specific form.
onerous.
(b) Express Mandate
2. Object or Subject Matter Article 1869, NCC. Agency may be express, or implied from the acts
of the principal, from his silence or lack of action, or his failure to
RULE: The object of every contract of agency is the execution of a repudiate the agency, knowing that another person is acting on his
juridical act in relation to a third person. (Rallos v. Felix Go Chan) The behalf without authority.
Agency may be oral, unless the law requires a specific form. An agency by estoppel, which is similar to the doctrine of apparent
authority, requires proof of reliance upon the representations, and that,
Article 1874, NCC. When a sale of a piece of land or any interest in turn, needs proof that the representations predated the action taken
therein is through an agent, the authority of the latter shall be in in reliance. (Litonjua, Jr. v. Eternit Corp.)
writing; otherwise, the sale shall be void.
(c) How It May Arise
GR: No form is required. (1869) Article 1873, NCC. If a person specially informs another or states by
EXC: When the agency relates to the sale of a piece of land or any public advertisement that he has given a power of attorney to a third
interest therein, the authority of the agent must be in writing; otherwise, person, the latter thereby becomes a duly authorized agent, in the
the sale shall be void. (1874) former case with respect to the person who received the special
information, and in the latter case with regard to any person.
(c) Implied Conferment of Mandate
Implied from acts of the principal, from his silence or lack of action, or The power shall continue to be in full force until the notice is
his failure to repudiate the agency, knowing that another person is acting rescinded in the same manner in which it was given.
on his behalf without authority. (1869)
(1) By Special Information: If a person specially informs another
(d) Acceptance of Mandate that he has given a power of attorney to a third person, the
Article 1870, NCC. Acceptance by the agent may also be express, latter thereby becomes a duly authorized agent with respect
or implied from his acts which carry out the agency, or from his to the person who received the special information. Such
silence or inaction according to the circumstances. power shall continue to be in full force until the notice is
rescinded in the same manner in which it was given.
Article 1871, NCC. Between persons who are present, the (2) By Public Advertisement: If a person states by public
acceptance of the agency may also be implied if the principal delivers advertisement that he has given a power of attorney to a third
his power of attorney to the agent and the latter receives it without person, the latter thereby becomes a duly authorized agent
any objection. with regard to any person. Such power shall continue to be in
full force until the notice is rescinded in the same manner in
Article 1872, NCC. Between persons who are absent, the which it was given.
acceptance of the agency cannot be implied from the silence of the
agent, except: C. Extent of Agency
(1) When the principal transmits his power of attorney to the agent,
who receives it without any objection; 1. As to Quantity of Transactions Covered
(2) When the principal entrusts to him by letter or telegram a power
of attorney with respect to the business in which he is habitually Article 1876[2], NCC. An agency is either general or special.
engaged as an agent, and he did not reply to the letter or
telegram. The former comprises all the business of the principal. The latter, one
or more specific transactions.
 May also be express, or implied from his acts which carry out the
agency, or from his silence or inaction according to the  General Agency – comprises all the business of the principal; or
circumstances. (1870)  Special Agency – comprises one or more specific transactions.
 Between persons who are present, the acceptance of agency may
also be implied if the principal delivers his power of attorney to the 2. As to Nature of Acts Authorized
agent and the latter receives it without any objection. (1871)
 For persons who are absent, the acceptance of the agency cannot  Agency Couched in General Terms: it comprises only acts of
be implied from the silence of the agent, except: administration, even if the principal should state that he withholds
o when the principal transmits his power of attorney to the no power or that the agent may execute such acts as he may
agent, who receives it without any objection; or consider appropriate, or even though the agency should authorize
o when the principal entrusts to him by letter or telegram a a general and unlimited management; (1877)
power of attorney with respect to the business in which he is  Agency Couched in Explicit or Specific Terms: the agency
habitually engaged as an not reply to the letter or telegram. indicates the particular function or functions which the agent is
(1872) authorized to exercise, whether the same be acts of administration
or acts of dominion.
3. Agency by Estoppel
3. Power of Attorney
(a) Concept
One who clothes another apparent authority as his agent, and holds (a) Definition
him out to the public as such, cannot be permitted to deny the authority  A power of attorney is only but an instrument in writing by which
of such person to act as his agent, to the prejudice of innocent third a person, as principal, appoints another as his agent and
parties dealing with such person in good faith. (BH Macke v. Camps) confers upon him the authority to perform certain specified
acts on behalf of the principal. (Angeles v. PNR)
(b) Requisites  It must be strictly construed and pursued. The instrument will be
 the principal manifested a representation of the agent’s authority or held to grant only those powers which are specified therein, and
knowingly allowed the agent to assume such authority; the agent may neither go beyond nor deviate from the power of
 the third person, in good faith, relied upon such representation; and attorney.
 relying upon such representation, such third person has changed
his position to his detriment. (b) Formalities Required
Article 1874, NCC. When a sale of a piece of land or any interest (1) to make payments as are not usually considered acts of
therein is through an agent, the authority of the latter shall be in administration;
writing; otherwise, the sale shall be void. (2) to effect novations which put an end to obligations already in
existence at the time the agency was constituted;
 The law does not even require that the special power of attorney (3) to compromise, to submit questions to arbitration, to renounce the
be in writing, but the same must be duly established by evidence right to appeal from judgment, to waive objections to the venue of
other than the self-serving assertion of the party claiming that such an action or to abandon a prescription already acquired—but a
authority was verbally given him (Home Insurance Co. v. US State special power to compromise does not authorize submission to
Lines Co.) arbitration; (1880)
 The requirements of a special power of attorney in Article 1878 CC (4) to waive any obligation gratuitously;
and of a special authority in Rule 138 refer to the nature of the (5) to enter into any contract by which the ownership of an immovable
authorization and not its form. (Lim Pin v. Liao Tan) is transmitted or acquired, either gratuitously or for a valuable
 The exception to this rule is the requirement in Article 1874 CC that consideration, to create or convey real rights over an immovable
the authority of the agent to sell a piece of land or any interest property, and to lease any real property to another person for more
therein be in writing; otherwise, the sale is void. than one year; —a special power to sell excludes the power to
mortgage; and a special power to mortgage does not include the
(c) General and Special Powers of Attorney power to sell;
 A general power permits the agent to do all acts for which the law (6) to make gifts, except customary ones for charity or those made to
does not require a special power (Dominion Insurance v. CA). employees in the business managed by the agent;
 However, the special power of attorney can be included in the (7) to loan or borrow money, unless the latter act (borrowing) be urgent
general power when it is specified therein the act or transaction for and indispensable for the preservation of the things which are
which the special power is required (Bravo-Guerrero v. Bravo). under administration, and to obligate the principal as a guarantor
or surety — there is a difference between authority to mortgage and
 Thus, even if a document is titled as a general power of attorney,
authority to contract an obligation (De Villa v. Fabricante) and the
the requirement of a special power of attorney is met if there is a
authority to mortgage does not carry with it the authority to contract
clear mandate from the principal specifically authorizing the
obligation (PNB v. Sta. Maria); thus, where the power of attorney
performance of the act.
given to the husband by the wife was limited to a grant of authority
to mortgage a parcel of land titled in the wife’s name, the wife may
(d) When Special Powers Necessary
not be held liable for the payment of the mortgage debt contracted
Article 1878, NCC. Special powers of attorney are necessary in the
by the husband; (De Villa v. Fabricante)
following cases:
(8) to bind the principal to render some service without compensation
(1) To make such payments as are not usually considered as acts
and to bind the principal in a contract of partnership;
of administration;
(9) to accept or repudiate an inheritance;
(2) To effect novations which put an end to obligations already in
(10) to ratify or recognize obligations contracted before the agency; and
existence at the time the agency was constituted;
(11) Any other act of strict dominion.
(3) To compromise, to submit questions to arbitration, to renounce
the right to appeal from a judgment, to waive objections to the
 Each of the powers enumerated above are named “acts of strict
venue of an action or to abandon a prescription already
dominion,” and cannot be implied powers; and that one form
acquired;
of named special power cannot give the presumption that it
(4) To waive any obligation gratuitously;
includes under any form of construction or interpretation
(5) To enter into any contract by which the ownership of an
another special power of attorney (Rodriguez v. Pamintuan)
immovable is transmitted or acquired either gratuitously or for a
o Thus, the power to mortgage does not carry the implied power
valuable consideration;
to represent the principal in litigation (Valmonte v. CA).
(6) To make gifts, except customary ones for charity or those made
to employees in the business managed by the agent;  However, every grant of power implies and carries with it, as
(7) To loan or borrow money, unless the latter act be urgent and an incident, authority to do acts, or use whatever means are
indispensable for the preservation of the things which are under reasonably necessary and proper to the accomplishment of
administration; the purpose for which the agency was created, unless the
(8) To lease any real property to another person for more than one inference of such power is expressly excluded by the instrument
year; creating the agency or by the circumstances of the business to
(9) To bind the principal to render some service without which the agency relates.
compensation;  For example, when an attorney-in-fact has been empowered to pay
(10) To bind the principal in a contract of partnership; the debts of the principal and to employ legal counsel to defend the
(11) To obligate the principal as a guarantor or surety; musawi principal’s interest, he has the implied power to pay on behalf of the
(12) To create or convey real rights over immovable property; principal the attorney’s fees charged by the lawyer. (Municipal
(13) To accept or repudiate an inheritance; Council of Iloilo v. Evangelista)
(14) To ratify or recognize obligations contracted before the agency;
(15) Any other act of strict dominion. D. Duties and Liabilities of Parties
1. Duties and Liabilities of Agent to Principal

Article 1879, NCC. A special power to sell excludes the power to
mortgage; and a special power to mortgage does not include the
(a) When Agency is Declined
power to sell.
Article 1885, NCC. In case a person declines an agency, he is bound
to observe the diligence of a good father of a family in the custody
Article 1880, NCC. A special power to compromise does not
and preservation of the goods forwarded to him by the owner until
authorize submission to arbitration.
the latter should appoint an agent. The owner shall as soon as
practicable either appoint an agent or take charge of the goods.
Article 1887, NCC. In the execution of the agency, the agent shall
in case a person declines an agency, he is bound to observe the act in accordance with the instructions of the principal.
diligence of a good father of a family in the custody and preservation of
the goods forwarded to him by the owner until the latter should appoint In default thereof, he shall do all that a good father of a family would
an agent or take charge of the goods. do, as required by the nature of the business.
(b) Duty to Advance Necessary Funds Article 1882, NCC. The agent may appoint a substitute if the
Article 1886, NCC. Should there be a stipulation that the agent shall principal has not prohibited him from doing so; but he shall be
advance the necessary funds, he shall be bound to do so except responsible for the acts of the substitute:
when the principal is insolvent. (1) When he was not given the power to appoint one;
(2) When he was given such power, but without designating the
Only if stipulated. However, even if there is such stipulation, the agent person, and the person appointed was notoriously incompetent
cannot be compelled to advance the necessary funds if the principal is or insolvent.
insolvent. All acts of the substitute appointed against the prohibition of the
principal shall be void.
(c) Duly in Case of Principal’s Death
Article 1884[2], NCC. The agent is bound by his acceptance to carry RULE: The agent is required to act in accordance with the instructions
out the agency, and is liable for the damages which, through his non- of the principal. (1887[1])
performance, the principal may suffer.
EXC:
He must also finish the business already begun on the death of the  if he performs the agency in a manner more advantageous to the
principal, should delay entail any danger. principal than that specified by the latter (1882); and
 in case of sudden emergency not caused by the agent’s fault,
The death of the principal extinguishes the agency but the agent still has where there is time to communicate with the principal, but
the obligation to finish the business already begun before the death of something must be done and a strict compliance with the
the principal, should delay entail any danger. instructions becomes impossible or would be detrimental to the
interests of the principal.
(d) Appointment of Substitute
Article 1892, NCC. The agent may appoint a substitute if the (f) Liability by Reason of Conflict of Interest
principal has not prohibited him from doing so; but he shall be Article 1889, NCC. The agent shall be liable for damages if, there
responsible for the acts of the substitute: being a conflict between his interests and those of the principal, he
(1) When he was not given the power to appoint one; should prefer his own.
(2) When he was given such power, but without designating the
person, and the person appointed was notoriously incompetent The agent shall be liable for damages to the principal if, there being a
or insolvent. conflict between his interests and those of the principal, he should prefer
his own. (1889)
All acts of the substitute appointed against the prohibition of the
principal shall be void. (g) If Authorized to Borrow Money
Article 1890, NCC. If the agent has been empowered to borrow
Article 1893, NCC. In the cases mentioned in Nos. 1 and 2 of the money, he may himself be the lender at the current rate of interest. If
preceding article, the principal may furthermore bring an action he has been authorized to lend money at interest, he cannot borrow
against the substitute with respect to the obligations which the latter it without the consent of the principal.
has contracted under the substitution.
Agent can be the lender at the current rate of interest.
RULE: The agent may appoint a substitute, except if the principal has
prohibited him from doing so. (1892) (h) If Authorized to Lend at Interest
 If Authorized by Principal: The acts of the substitute will bind the Agent cannot borrow it without the consent of the principal. (1890)
principal. If the agent appointed a substitute designated by the
principal, the agent is not liable for the acts of the substitute. If the (i) If Authorized to Sell
agent appointed a substitute of his own choice, he is also not liable Article 1491[2], NCC. The following persons cannot acquire by
for the acts of the substitute unless he appointed a person who was purchase, even at a public or judicial auction, either in person or
notoriously incompetent or insolvent. If he appointed a substitute through the mediation of another:
who is notoriously incompetent or insolvent, the principal may (2) Agents, the property whose administration or sale may have been
furthermore bring an action against the substitute with respect to intrusted to them, unless the consent of the principal has been given;
the obligations which the latter has contracted under the
substitution. (1893) Agent cannot buy for himself without the consent of the principal;
 If Not Authorized but Not Prohibited: The acts of the substitute otherwise, the contract is void.
will bind the principal but the agent will be liable for the acts of the
substitute. The principal may furthermore bring an action against (j) Duty to Exercise Due Diligence:
the substitute with respect to the obligations which the latter has Article 1887, NCC. In the execution of the agency, the agent shall
contracted under the substitution. act in accordance with the instructions of the principal.
 If Prohibited: The acts of the substitute shall not be enforceable
against the principal unless the same are ratified by the latter. In default thereof, he shall do all that a good father of a family would
(Escueta v. Lim) do, as required by the nature of the business.
(e) Duty to Follow Instructions

Article 1888, NCC. An agent shall not carry out an agency if its Article 1905, NCC. The commission agent cannot, without the
execution would manifestly result in loss or damage to the principal. express or implied consent of the principal, sell on credit. Should he
do so, the principal may demand from him payment in cash, but the
RULE: In the absence of instructions from the principal, the agent, in the commission agent shall be entitled to any interest or benefit, which
execution of the agency, must do all that a good father of a family would may result from such sale.
do, as required by the nature of the business. (1887[2]) Hence, the agent
also has the obligation not to carry out an agency if its execution would Article 1906, NCC. Should the commission agent, with authority of
manifestly result in loss or damage to the principal. (1888) the principal, sell on credit, he shall so inform the principal, with a
statement of the names of the buyers. Should he fail to do so, the
Liability for Fraud and Negligence sale shall be deemed to have been made for cash insofar as the
Article 1909, NCC. The agent is responsible not only for fraud, but principal is concerned.
also for negligence, which shall be judged with more or less rigor by
the courts, according to whether the agency was or was not for a  He cannot sell on credit unless with the consent of the principal.
compensation. o If he does, the principal may demand from him payment in
cash, but the commission agent shall be entitled to any
 The agent is responsible not only for fraud, but also for interest or benefit, which may result from such sale (1905).
negligence (1909).  If he sells on credit with authority from the principal, he shall so
 Pursuant to this rule, the law imposes upon the agent the absolute inform the principal, with a statement of the names of the buyers. If
obligation to make a full disclosure or complete account to his he fails to do so, the sale shall be deemed to have been made for
principal of all his transactions and other material facts relevant to cash insofar as the principal is concerned (1906).
the agency and to deliver to the principal whatever he may have
received by virtue of the agency, even though it may not be owing Del Credere Agent
to the principal (1891[1]), so much so that the law does not Article 1907, NCC. Should the commission agent receive on a sale,
countenance any stipulation exempting the agent from such an in addition to the ordinary commission, another called a guarantee
obligation and considers such an exemption as void. (1891[2]; commission, he shall bear the risk of collection and shall pay the
Domingo v. Domingo) principal the proceeds of the sale on the same terms agreed upon
with the purchaser.
Effect of Compensation
However, the negligence of the agent shall be judged with more or less  A commission agent who receives a guaranty commission (called
rigor by the courts, according to whether the agency was or was not for a del credere commission), in addition to the ordinary commission,
a compensation. (1909) is known as a “del credere agent.” He bears the risk of collection
and he shall pay the principal the proceeds of the sale on the same
If He Uses Money of Principal for Own Use terms agreed upon with the purchaser. (1907)
Article 1896, NCC. The agent owes interest on the sums he has  However, the liability of the del credere agent does not preclude
applied to his own use from the day on which he did so, and on those the principal from resorting to the purchaser to obtain payment, at
which he still owes after the extinguishment of the agency. any time before the debt is paid.
The agent owes interest on the sums he has applied to his own use from (l) Duty to Collect
the day on which he did so, and on those which he still owes after the Article 1908, NCC. The commission agent who does not collect the
extinguishment of the agency. credits of his principal at the time when they become due and
demandable shall be liable for damages, unless he proves that he
(k) Rule on Sale by Commission Agent: exercised due diligence for that purpose.
Duties on Care of Goods  A commission agent who does not collect the credits of his principal
Article 1903, NCC. The commission agent shall be responsible for at the time when they become due and demandable shall be liable
the goods received by him in the terms and conditions and as for damages. (1908)
described in the consignment, unless upon receiving them he should  However, he is not liable if he can prove that he exercised due
make a written statement of the damage and deterioration suffered diligence for that purpose.
by the same.
(m) Liability of Two or More Agents
Article 1904, NCC. The commission agent who handles goods of the
same kind and mark, which belong to different owners, shall Article 1894, NCC. The responsibility of two or more agents, even
distinguish them by countermarks, and designate the merchandise though they have been appointed simultaneously, is not solidary, if
respectively belonging to each principal. solidarity has not been expressly stipulated.
 He shall be responsible for the goods received by him in the terms Article 1895, NCC. If solidarity has been agreed upon, each of the
and conditions and as described in the consignment, unless upon agents is responsible for the non-fulfillment of the agency, and for the
receiving them he should make a written statement of the damage fault or negligence of his fellows agents, except in the latter case
and deterioration suffered by the same (1903); when the fellow agents acted beyond the scope of their authority.
 a commission agent who handles goods of the same kind and
mark, which belongs to different owners, shall distinguish them by  RULE: Their liability is merely joint, if solidarity has not been
countermarks, and designate the merchandise respectively expressly stipulated. (1894)
belonging to each principal. (1904)  If Solidarity is Stipulated: Each of the agents is responsible for
the non-fulfillment of the agency, and for the fault or negligence of
Rule on Sale on Credit
his fellow agents, except in the latter case when the fellow agents  when the expenses were due to the fault of the agent;
acted beyond the scope of their authority. (1895)  when the agent incurred them with knowledge that an unfavorable
result would ensue, if the principal was not aware thereof; or
2. Duties and Liabilities of Principal to Agent  when it was stipulated that the expenses would be borne by the
agent, or that the latter would be allowed only a certain sum.
(a) Duty to Pay Compensation
Article 1875, NCC. Agency is presumed to be for a compensation, (c) Duty to Indemnify Agent for Damages:
unless there is proof to the contrary. Article 1913, NCC. The principal must also indemnify the agent for
all the damages which the execution of the agency may have caused
Rule: Agency is presumed to be for compensation, unless there is proof the latter, without fault or negligence on his part.
to the contrary.
 Rule: Principal must indemnify the agent for all the damages which
Doctrine of Procuring Cause the execution of the agency may have caused the latter. (1913)
RULE:  EXC: Principal not liable if the damages were occasioned by the
 In order for an agent to be entitled to a commission, he must be the fault or negligence on the part of the agent.
procuring cause of the sale, which simply means that the measures
employed by him and the efforts he exerted must result in a sale. (d) Agent’s Lien
 In other words, an agent receives his commission only upon the Article 1914, NCC. The agent may retain in pledge the things which
successful conclusion of a sale. (Sanchez v. Medicard) are the object of the agency until the principal effects the
 Conversely, it follows that where his efforts are unsuccessful, or reimbursement and pays the indemnity set forth in the two preceding
there was no effort on his part, he is not entitled to a commission. articles.
 The doctrine applies even if the sale took place after the
authority of the agent had lapsed so long there was proximate,  The agent may retain in pledge the things which are the object of
close, and causal connection between the agent’s efforts and the agency until the principal effects the reimbursement and pays
the principal’s sale of his property (Manotok Brothers v. CA). the indemnity mentioned herein (1914).
 In fact, even if the agent was not the efficient procuring cause and  The lien may be enforced in the same way as a pledge, that is, by
the sale took place after the expiration of his authority, he is having the property sold at public auction, in the manner prescribed
nonetheless entitled to his commission when he took diligent steps by law.
to bring back together the parties, such that a sale was finalized
and consummated between them. (Prats v. CA) (e) Liability of Two or More Principals
Article 1915, NCC. If two or more persons have appointed an agent
(b) Obligation to Advance Necessary Funds for a common transaction or undertaking, they shall be solidarily
liable to the agent for all the consequences of the agency.
Article 1912, NCC. The principal must advance to the agent, should
the latter so request, the sums necessary for the execution of the If two or more persons have appointed an agent for a common
agency. transaction or undertaking, they shall be solidarity liable to the agent for
the all the consequences of the agency.
Should the agent have advanced them, the principal must reimburse
him therefor, even if the business or undertaking was not successful, E. Rights and Liabilities of Parties in Relation to Third Persons
provided the agent is free from all fault.
1. Liability for Contracts Entered by Agent
The reimbursement shall include interest on the sums advanced,
from the day on which the advance was made. (a) When Agent Acted Within Scope of His Authority
Article 1897, NCC. The agent who acts as such is not personally
Rule: In the absence of stipulation that the agent shall advance the liable to the party with whom he contracts, unless he expressly binds
funds necessary to carry out the agency, the same must be advanced himself or exceeds the limits of his authority without giving such party
by the principal, should the agent so request. (1912) sufficient notice of his powers.
Instance Where Principal Not Liable for Expenses Incurred by  Rule: It is the principal who is liable to the third person while the
Agent agent is completely absolved of any liability, as a rule (1897).
Article 1918, NCC. he principal is not liable for the expenses incurred o This rule applies whether or not the third person dealing with
by the agent in the following cases: the agent believes that the agent has actual authority.
(1) If the agent acted in contravention of the principal’s instructions, (Sargasso)
unless the latter should wish to avail himself of the benefits  EXC: Agent becomes liable to the third person even if he acted
derived from the contract; within the scope of his authority when:
(2) When the expenses were due to the fault of the agent; o he expressly binds himself (1897); or
(3) When the agent incurred them with knowledge that an o he is guilty of fraud or negligence (1909).
unfavorable result would ensue, if the principal was not aware
 As to Liability of Third Person: The liability of the third person is
thereof;
to the principal and not to the agent. The agent has neither rights
(4) When it was stipulated that the expenses would be borne by the
nor liabilities as against the third party
agent, or that the latter would be allowed only a certain sum.
(b) When Agent Acted Beyond Scope of His Authority or Without
 if the agent acted in contravention of the principal’s instructions, Authority
unless the latter should wish to avail himself of the benefits derived
from the contract;
Article 1898, NCC. If the agent contracts in the name of the principal, The provisions of this article shall be understood to be without
exceeding the scope of his authority, and the principal does not ratify prejudice to the actions between the principal and agent.
the contract, it shall be void if the party with whom the agent
contracted is aware of the limits of the powers granted by the Rule: If an agent acts in his own name, the principal has no right of
principal. In this case, however, the agent is liable if he undertook to action against the third person with whom the agent has contracted;
secure the principal’s ratification. neither have such persons against the principal (1883[1]).
 In such case the agent is the one directly bound in favor of the
Article 1910, NCC. The principal must comply with all the obligations person with whom he has contracted, as if the transaction were his
which the agent may have contracted within the scope of his own.
authority.  As between the principal and the agent,
o the former can avail of the benefits derived by the latter
As for any obligation wherein the agent has exceeded his power, the from the contract with the third person, or
principal is not bound except when he ratifies it expressly or tacitly. o the former may sue the latter for damages because of non-
compliance with the agency.
Article 1317, NCC. No one may contract in the name of another
without being authorized by the latter, or unless he has by law a right EXC: When the contract involves things belonging to the principal,
to represent him. hence, the contract must be considered as entered into between the
principal and the third person.
A contract entered into in the name of another by one who has no  Corollarily, if the principal can be obliged to perform his duties
authority or legal representation, or who has acted beyond his under the contract, then it can also demand the enforcement of its
powers, shall be unenforceable, unless it is ratified, expressly or rights arising from the contract (NFA v. IAC).
impliedly, by the person on whose behalf it has been executed,  However, the exception does not apply where the agent has
before it is revoked by the other contracting party. exceeded his authority. (National Bank v. Agudela)
Article 1911, NCC. Even when the agent has exceeded his authority, (d) When Both Principal and Agent Transacted
the principal is solidarily liable with the agent if the former allowed the Article 1544, NCC. If the same thing should have been sold to
latter to act as though he had full powers. different vendees, the ownership shall be transferred to the person
who may have first taken possession thereof in good faith, if it should
Rule: The contract does not bind the principal (1898, 1910[2]); it is be movable property.
unenforceable if not ratified by the principal (1317, 1403[1]).
 However, if the sale of a parcel of land or any interest therein is Should it be immovable property, the ownership shall belong to the
made by agent without authority from the principal, the sale is void person acquiring it who in good faith first recorded it in the Registry
(1874). It is the agent himself who becomes liable to a third of Property.
party with whom he contracted with when he exceeds the limits of
his authority without giving notice of his powers to the third person Should there be no inscription, the ownership shall pertain to the
(1897[2]). person who in good faith was first in the possession; and, in the
o But if he notified the third person of the limits of his absence thereof, to the person who presents the oldest title, provided
authority, he is not liable to such third person, unless he there is good faith.
undertook to secure the principal’s ratification (1898).
o As to the third person, when he was not given notice of the Article 1916, NCC. When two persons contract with regard to the
agent’s power, he can hold the agent personally liable to same thing, one of them with the agent and the other with the
him. principal, and the two contracts are incompatible with each other, that
o But when he is aware of such limits of authority, he is to blame, of prior date shall be preferred, without prejudice to the provisions of
and is not entitled to recover damages from the agent, unless article 1544.
the latter undertook to secure the principal’s ratification.
(1898) Rule: When both the principal and agent entered into a contract over the
same thing, that of prior date shall be preferred, without prejudice to the
EXC: The principal becomes liable even if the agent has exceeded his provisions of Article 1544 of the Civil Code. (1916)
powers in the following instances:
 when the principal ratifies the contract, either expressly or Who Rears Liability: If the agent has acted in good faith, the principal
impliedly (1317, 1403[1]), in which case, only the principal becomes shall be liable in damages to the third person whose contract must be
liable to the third person; or rejected. If the agent acted in bad faith, he alone shall be responsible.
 when the principal allowed the agent to act as though he had (1917)
full powers, in which case, the principal becomes solidarily liable
with the agent (1911). (e) Liability for Delict or Quasi-delict Committed by Agent
So long as the agent acts within the scope of his authority, the principal
(c) When Agent Contracted in His Name is liable for the delict or quasi-delict of his agent. But the agent is liable
Article 1883, NCC. If an agent acts in his own name, the principal to the principal not only for fraud, but also for negligence. (1909)
has no right of action against the persons with whom the agent has
contracted; neither have such persons against the principal. (f) Liability in Agency by Estoppel
In such case the agent is the one directly bound in favor of the person Who is Liable to Third Person: It is the principal who is liable.
with whom he has contracted, as if the transaction were his own,
except when the contract involves things belonging to the principal. Requisites: In order for the principal to be liable, it is necessary that the
following requisites must be established:
 the principal manifested a representation of the agent’s authority or  if it is the means of fulfilling an obligation already contracted; or
knowingly allowed the agent to assume such authority;  if a partner is appointed manager of a partnership in the contract of
 the third person, in good faith, relied upon such representation; and partnership and his removal from the management is unjustifiable.
 relying upon such representation, such third person has changed (1927)
his position to his detriment. (Manila Remnant Co. v. CA)
When Agency Deemed Revoked
In agency by estoppel, the apparent authority is determined only by the Article 1923, NCC. The appointment of a new agent for the same
acts of the principal and not by the acts of the agent. The principal is, business or transaction revokes the previous agency from the day on
therefore, not responsible where the agent’s own conduct and which notice thereof was given to the former agent, without prejudice
statements have created the apparent authority. (Sargasso) to the provisions of the two preceding articles.
F. Extent of Agency Article 1924, NCC. The agency is revoked if the principal directly
manages the business entrusted to the agent, dealing directly with
1. Modes of Extinguishment third persons.
Article 1919, NCC. Agency is extinguished: Article 1926, NCC. A general power of attorney is revoked by a
(1) By its revocation; special one granted to another agent, as regards the special matter
(2) By the withdrawal of the agent; involved in the latter.
(3) By the death, civil interdiction, insanity or insolvency of the
principal or of the agent;  When a new agent is appointed for the same business or
(4) By the dissolution of the firm or corporation which entrusted or transaction, the previous agency is revoked from the day on which
accepted the agency; notice thereof was given to the former agent; (1923)
(5) By the accomplishment of the object or purpose of the agency;  when the principal directly manages the business entrusted to the
(6) By the expiration of the period for which the agency was agent, dealing directly with third persons; (1924) or
constituted.  a general power of attorney is revoked by a special one granted to
another agent, as regards the special matter involved in the latter.
Article 1231, NCC. Obligations are extinguished: (1926)
(1) By payment or performance;
(2) By the loss of the thing due; Necessity of Notice
(3) By the condonation or remission of the debt; Article 1921, NCC. If the agency has been entrusted for the purpose
(4) By the confusion or merger of the rights of creditor and debtor; of contracting with specified persons, its revocation shall not
(5) By compensation; prejudice the latter if they were not given notice thereof.
(6) By novation.
Other causes of extinguishment of obligations, such as annulment,
Article 1922, NCC. If the agent had general powers, revocation of
rescission, fulfillment of a resolutory condition, and prescription, are
the agency does not prejudice third persons who acted in good faith
governed elsewhere in this Code.
and without knowledge of the revocation. Notice of the revocation in
a newspaper of general circulation is a sufficient warning to third
(1) revocation; persons.
(2) withdrawal of the agent;
(3) death, civil interdiction, insanity, or insolvency of the principal or of
 As between the agent and principal, in order for the revocation to
the agent;
be effective against the agent, the latter must be duly notified.
(4) dissolution of the firm or corporation which entrusted or accepted
 As between the principal and third person:
the agency;
o if the agency has been entrusted for the purpose of
(5) accomplishment of the object or purpose of the agency;
contracting with specified persons, its revocation shall not
(6) expiration of the period for which the agency was constituted;
prejudice the latter if they were not given notice thereof (1921)
(1919) or
o and if the agent had general powers, revocation of the agency
(7) any other modes provided by the general law for the extinction of
does not prejudice third persons who acted in good faith and
obligations, so far as applicable. (1231)
without knowledge of the revocation.
o Notice of the revocation in a newspaper of general circulation
Revocation
is a sufficient warning to third persons. (1922)
Article 1920, NCC. The principal may revoke the agency at will, and
compel the agent to return the document evidencing the agency.
Withdrawal by Agent
Such revocation may be express or implied.
Article 1928, NCC. The agent may withdraw from the agency by
giving due notice to the principal. If the latter should suffer any
Article 1927, NCC. An agency cannot be revoked if a bilateral
damage by reason of the withdrawal, the agent must indemnify him
contract depends upon it, or if it is the means of fulfilling an obligation
therefor, unless the agent should base his withdrawal upon the
already contracted, or if a partner is appointed manager of a
impossibility of continuing the performance of the agency without
partnership in the contract of partnership and his removal from the
grave detriment to himself.
management is unjustifiable.
Article 1929, NCC. The agent, even if he should withdraw from the
Rule: Generally, the agency may be revoked by the principal at will, and
agency for a valid reason, must continue to act until the principal has
compel the agent to return the document evidencing the agency. (1920)
had reasonable opportunity to take the necessary steps to meet the
situation.
EXC: When the agency is coupled with interest (Republic v.
Evangelista), as in the following cases:
 a bilateral contract depends upon it;
 Rule: Agent may withdraw from the agency by giving due notice to
the principal. (1928)
 Liability for Damages: If the principal should suffer any damage
by reason of the withdrawal by the agent, the latter must indemnify
the principal therefor, unless the agent should base his withdrawal
upon the impossibility of continuing the performance of the agency
without grave detriment to himself.
 Duty of Agent Upon Withdrawal: The agent must continue to act
until the principal has had reasonable opportunity to take the
necessary steps to meet the situation, even if he should withdraw
from the agency. (1929)
Effect of Death
Article 1930, NCC. The agency shall remain in full force and effect
even after the death of the principal, if it has been constituted in the
common interest of the latter and of the agent, or in the interest of a
third person who has accepted the stipulation in his favor.
Article 1931, NCC. Anything done by the agent, without knowledge

of the death of the principal or of any other cause which extinguishes
the agency, is valid and shall be fully effective with respect to third
persons who may have contracted with him in good faith.
RULE: Agency is extinguished by the death of the principal or the agent.

(1919; Rallos)
 EXC
 agency shall remain in full force and effect even after the death of
the principal, if it has been constituted in the common interest of
the latter and of the agent, or in the interest of a third person who
has accepted the stipulation in his favor (1930) and
 anything done by the agent, without knowledge of the death of the
principal or of any other cause which extinguishes the agency, is
valid and shall be fully effective with respect to third persons who
may have contracted with him in good faith. (1931)
PART 6: CONTRACTS OF LOAN AND DEPOSIT legal interest, whether the case falls under
paragraph 1 or paragraph 2, above, shall be 6%
LECTURE NOTES per annum from such finality until its satisfaction,
Contract of Commodatum this interim period being deemed to be by then an
Contract of Mutuum equivalent to a forbearance of credit.
Contract of Deposit  In addition to the above, judgments that have become final and
executory prior to July 1, 2013 shall be disturbed and shall
Eastern Shipping was modified in the case of Nacar because of the continue to be implemented applying the rate of interest fixed
lowering of the legal rate of interest introduced by the BSP circular. In therein.
2019, the ruling in those two cases was further modified by Lara’s Gifts.
Lara's Gift v. Midtown, GR No 225433, 28 August 2019
Nacar v. Gallery Frames, G.R. No. 189871, August 13, 2013
SUMMARY: Lara’s Gifts purchased from Midtown Industrial various
SUMMARY: Nacar filed and won an illegal dismissal case against industrial and construction materials totaling Pl,263,104.22. The
Gallery Frames. The Labor Arbiter awarded him with separation pay purchases were on a 60-day credit term, with the condition that 24%
and backwages. However, he appealed for the recomputation of the interest per annum would be charged on all accounts overdue, as
judgment award and for interest. The SC granted ruled in his favor stated in the sales invoices. Lara’s Gifts issued PDCs covering the
on both accounts. The Court adhered to the ruling in Eastern purchase price but such PDCs bounced upon presentment in the
Shipping Lines, but with modifications to comply with BSP-MB bank. Upon repeated demand of Midtown Industrial, Lara’s Gifts
Circular No. 799 lowering the legal interest rate from 12% to 6%. issued another set of PDCs which again bounced. Midtown Industrial
filed a Complaint for Sum of Money with Prayer for Attachment
DOCTRINE: against Lara’s Gifts. Unless the stipulated interest is excessive and
 the guidelines laid down in Eastern Shipping LInes are unconscionable, there is no legal basis for the reduction of the
modified to embody BSP-MB Circular 700, as follows: stipulated interest at any time until full payment of the principal
o When an obligation, regardless of its source, i.e., law, amount. The stipulated interest remains in force until the obligation is
contracts, quasi-contracts, delicts or quasi-delicts is satisfied. In the absence of stipulated interest, the prevailing legal
breached, the contravenor can be held liable for damages. interest prescribed by the BSP shall apply.
The provisions under Title XVIII on “Damages” of the Civil
Code govern in determining the measure of recoverable DOCTRINE: Under the Usury Law and jurisprudence, the prevailing
damages. legal interest prescribed by the BSP applies, in the absence of
o With regard particularly to an award of interest in the stipulated interest, on the following:
concept of actual and compensatory damages, the rate of (1) loans;
interest, as well as the accrual thereof, is imposed, as (2) forbearance of any money, goods or credits; and
follows: (3) judgments in litigations involving loans or forbearance of money,
 When the obligation is breached, and it consists in the goods or credits.
payment of a sum of money, i.e., a loan or
forbearance of money, the interest due should be that Lara’s Gifts: It is the rate agreed upon that will be applicable from the
which may have been stipulated in writing. finality up to the satisfaction the judgment, unless such rate is declared
Furthermore, the interest due shall itself earn legal by the court as unconscionable and excessive. (Regardless if
interest from the time it is judicially demanded. In the compensatory or monetary interest) – 6%/annum
absence of stipulation, the rate of interest shall be
6% per annum to be computed from default, i.e., If the interest is in the nature of forbearance of money (prior to July 1,
from judicial or extrajudicial demand under and 2013) – 12%/annum. The BSP Circular is prospective.
subject to the provisions of Article 1169 of the
Civil Code. Monetary Interest: Interest on the cost of using money (1956 applies)
 When an obligation, not constituting a loan or ARTICLE 1956. No interest shall be due unless it has been expressly
forbearance of money, is breached, an interest on the stipulated in writing.
amount of damages awarded may be imposed at the
discretion of the court at the rate of 6% per annum. Compensatory interest: represents interest from damage
No interest, however, shall be adjudged on 1170: Those who in the performance of their obligations are guilty of
unliquidated claims or damages, except when or until fraud, negligence, or delay, and those who in any manner contravene
the demand can be established with reasonable the tenor thereof, are liable for damages.
certainty. Accordingly, where the demand is 2209: If the obligation consists in the payment of a sum of money, and
established with reasonable certainty, the interest the debtor incurs in delay, the indemnity for damages, there being no
shall begin to run from the time the claim is made stipulation to the contrary, shall be the payment of the interest agreed
judicially or extrajudicially (Art. 1169, Civil Code), but upon, and in the absence of stipulation, the legal interest, which is six
when such certainty cannot be so reasonably per cent per annum.
established at the time the demand is made, the  1956 applies – interest must be expressly interest in writing.
interest shall begin to run only from the date the Otherwise, the obligation to pay interest does not become a case
judgment of the court is made (at which time the of civil obligation. But if the interest is agreed upon verbally, it’s a
quantification of damages may be deemed to have natural obligation (1960)
been reasonably ascertained). The actual base for  ARTICLE 1960. If the borrower pays interest when there has been
the computation of legal interest shall, in any no stipulation therefor, the provisions of this Code concerning
case, be on the amount finally adjudged. solutio indebiti, or natural obligations, shall be applied, as the case
 When the judgment of the court awarding a sum of may be.
money becomes final and executory, the rate of
 A loan can be gratuitious. But if there’s interest, for it to be a civil o Principal contracts in credit transactions: commodatum,
obligation, it must be in writing. If it’s oral, it’s a natural obligation. mutuum, deposit
o Pledge has been repealed by the PPSA
What rates?  PPSA mandates the creation of a nationwide and centralized
 Agreed rate electronic registry of collateral contracts involving personal
 Legal rate property
Compensatory:
 Imposed by law or by the court Not covered by PPSA (Section 4)
 Payable from the moment the debtor incurs delay
RA 11057 [Personal Property Securities Act].
1934 Section 4. Scope of the Act.— This Act shall apply to all
ARTICLE 1934. An accepted promise to deliver something by way of transactions of any form that secure an obligation with movable
commodatum or simple loan is binding upon the parties, but the collateral, except interests in aircrafts subject to Republic Act No.
commodatum or simple loan itself shall not be perfected until the 9497, or the "Civil Aviation Authority Act of 2008", and interests in
delivery of the object of the contract. (n) ships subject to Presidential Decree No. 1521, or the "Ship Mortgage
Decree of 1978".
If delivery is a requirement for perfection because the contract is a real
contract, delivery cannot be compelled. Delivery is not an obligation. You  Aircrafts
cannot compel the perfection of a contract  Ships
In case of breach, the only remedy is recovery of damages.  These exception means that the registration of the collateral will not
follow the requirement of the PPSA. It’s not an electronic
Consensual Contracts that Create an Obligation to Deliver registration.
 Sale o If the collateral is an interest in airplanes, it must be registered
 Barter with the PH Civil Aviation Authority
 Antichresis o Ships and Vessels – registered with PH Coast Guard of the
o Delivery of the immovable is not required to perfect the port where the vessel or ship was registered
contract  The contract involving aircrafts and ships will be referred to as
 After the perfection of contract, it will create an obligation to deliver SECURITY AGREEMENT.
the object of the contract
o THUS, such delivery can be compelled. Perfection of Contracts
 This contract is consensual.
Real Estate Mortgage v. Antichresis  But aside from perfection, there is a creation of security interest.
 Possession by the creditor of the immovable DOES NOT o Upon perfection, it does not follow that there is a creation of
DISTINGUISH antichresis from REM security interest.
o It’s possible that in both contracts, the creditor is in possession o Creation of security interest – lien; you get priority over the
of the immovable. collateral because the contract of security becomes binding
o In REM – creditor may become entitled to possession if it’s upon third persons
expressly stipulated in the contract o 11057 – the point of creating the contract is called
o Antichresis – possession is required. PERFECTION OF SECURITY INTEREST which is different
 Antichresis – there must be an EXPRESS AGREEMENT from PERFECTION OF CONTRACT.
authorizing the creditor to receive the fruits of the immovable with
the corresponding obligation to apply the fruits to the payment of Registration
principal  During the transition period, the collateral contract is registered in
o In the absence of that express agreement, the contract is not the Chattel Mortgage Registry in the municipality where the
antichresis but REM. property is located (Section 4, Chattel Mortgage Law)
o Principal + Interest must be specified in writing. Otherwise, the o Only in the meantime (11507)
contract of antichresis is VOID (2124).
o If 2124 is already complied with in the original loan, the parties Pajuyo v. CA
may enter into an oral contract of antichresis. (to apply the
fruits to the debts, etc.) SUMMARY: Through a Kasunduan, Pajuyo allowed Guevarra to live
 This may be proven by parol evidence. in his house for free with an obligation to maintain it in good condition
 In relation to real properties, only 3 transactions are covered by the and to vacate it when Pajuyo would need it. Pajuyo asked Guevarra
Statute of Frauds to vacate when he needed it but was refused. An ejectment case was
o Sale of real property filed.
o Lease of real property for a period longer than 1 year
o Express trust over an immovable (1443) The court held that the Kasunduan was not a commodatum because
o REM, ANTICHRESIS ARE NOT INCLUDED. it is not gratuitous. It imposed an obligation upon Guevarra to
maintain the house and lot in good condition. When Guevarra refused
PPSA to vacate the premises after demand of Pajuyo, his possession of the
 Difference between pledge and chattel mortgage has been property became unlawful. Pajuyo was held to be entitled to the
REMOVED. physical possession of the property.
 All collaterals involving personal property are now known as
contracts of security involving personal property. DOCTRINE: An essential feature of commodatum is that it is
 Nabasan ang real contracts gratuitous, while another feature is that the use of the thing belonging
to another is for a certain period; If the use of the thing is merely

tolerated by the bailor, he can demand the return of the thing at will,
in which case the contractual relation is called a precarium;
Precarium is a kind of commodatum.
1163: the debtor in every determinate obligation has the duty to preserve
the thing delivered. (Diligence of a good father of a family.)
 Sir’s comments on the case: the agreement to maintain the house

should not be considered a consideration because that is the duty
of every borrower
 ESSENTIALLY GRATUITOUS – commodatum
 Precarium – use of the thing is merely tolerated
o Remedy of owner: Unlawful detainer; there is a contract of
commodatum (precarium)
 This will require a demand to vacate.
PREBAR-REVIEWER Article 1933, NCC. By the contract of loan, one of the parties delivers
to another, either something not consumable so that the latter may
CONTRACT OF COMMODATUM use the same for a certain time and return it, in which case the
contract is called a commodatum; or money or other consumable
A. Kinds of Contracts of Loan thing, upon the condition that the same amount of the same kind and
quality shall be paid, in which case the contract is simply called a loan
1. Classification or mutuum.
Two Kinds of Loan Commodatum is essentially gratuitous.
Article 1933, NCC. By the contract of loan, one of the parties delivers Simple loan may be gratuitous or with a stipulation to pay interest.
to another, either something not consumable so that the latter may
use the same for a certain time and return it, in which case the In commodatum the bailor retains the ownership of the thing loaned,
contract is called a commodatum; or money or other consumable while in simple loan, ownership passes to the borrower.
thing, upon the condition that the same amount of the same kind and
quality shall be paid, in which case the contract is simply called a loan Article 1953, NCC. A person who receives a loan of money or any
or mutuum. other fungible thing acquires the ownership thereof, and is bound to
pay to the creditor an equal amount of the same kind and quality.
Commodatum is essentially gratuitous.
Article 1937, NCC. Movable or immovable property may be the
Simple loan may be gratuitous or with a stipulation to pay interest. object of commodatum.
In commodatum the bailor retains the ownership of the thing loaned, 2. How Perfected
while in simple loan, ownership passes to the borrower.
Both are Real Contracts
(1) Contract of Commodatum: this is a contract of loan by one to Article 1934, NCC. An accepted promise to deliver something by
another of non-consumable property to be temporarily used by way of commodatum or simple loan is binding upon the parties, but
the latter and returned in specie, as where a horse or a house is the commodatum or simple loan itself shall not be perfected until the
lent to a friend to be used by him. delivery of the object of the contract.
(2) Contract of Mutuum: this is a contract of loan by one of money  Both contracts shall not be perfected until the delivery of the
or other consumable things to another for consumption, this object of the contract (1934).
other becoming the owner of the things subject to an obligation to o Thus, in a case where a prospective lender issued checks to
repay the same amount of the same quality as he had received, as a prospective borrower but there was no evidence that the
where A delivers a quantity of rice to B to the end that B shall checks were actually encashed or deposited because the
consume or otherwise dispose of it on condition that he shall repay checks were retained by another person, the Court ruled that
A with rice of the same quality and quantity. the contract of loan was not perfected because the checks
were not encashed. (Naguiat v. CA)
Distinctions
Commodatum Mutuum Accepted Promise to Lend or to Borrow
Purpose use the thing consume the thing borrowed  An accepted promise to deliver something by way of commodatum
borrowed and with and with the obligation to or simple loan is binding upon parties (1934).
the obligation to repay its equivalent in kind,  This contract is consensual, which can only give rise to an
return the very quality, and quantity action for damages in case of breach (BPI Investment Corp. v.
same thing CA), not an action for specific performance.
Object movable or object is always movable  The delivery of the thing borrowed cannot be compelled. It is
immovable property and it is always different from the real contract of loan which requires the delivery
money or other consumable of the object of the contract for its perfection and which gives rise
if it is movable property to obligations only on the part of the borrower.
property, it is
ordinarily non- B. Nature and Characteristics of Commodatum
consumable;
Right in bailor retains the ownership passes to the 1. Peculiar Characteristics of Contract
Subject ownership of the borrower
Matter thing loaned Purpose:
Duty of the specific thing the thing loaned may be Article 1940, NCC. A stipulation that the bailee may make use of the
Borrower loaned is to be consumed, and the fruits of the thing loaned is valid.
returned borrower discharges
himself, not by returning the
 enjoyment and use of the thing borrowed.
identical thing loaned, but by
 But unlike in usufruct, the bailee (borrower) has no right over the
paying its equivalent in kind,
fruits, unless there is a stipulation to that effect.
quality, and quantity
Consideration essentially mutuum may be gratuitous
No Transfer of Ownership
gratuitous or with a stipulation to pay
Article 1938, NCC. The bailor in commodatum need not be the
interest
owner of the thing loaned.
(1) the bailee is liable for the loss of the thing, even if it should be
 The bailor (lender) retains the ownership of the thing loaned through a fortuitous event; (1942[3]) and
(1933[4]) and the obligation of the borrower is to return the very (2) the bailee is liable for extraordinary expenses for the preservation
same thing that he borrowed (1933[1]). of the thing arising from the fault of the delegate.
 Hence, the bailor in commodatum need not be the owner of the
thing loaned (1938), but he must be authorized by the owner or C. Obligations of Parties
he must have a possessory interest in the subject matter;
otherwise, the contract is void because the cause or object did not 1. Obligations of the Bailee (Borrower)
exist at the time of the transaction. (1409[3])
(a) Ordinary Expenses
Subject Matter Article 1941, NCC. The bailee is obliged to pay for the ordinary
Article 1936, NCC. Consumable goods may be the subject of expenses for the use and preservation of the thing loaned.
commodatum if the purpose of the contract is not the consumption of
the object, as when it is merely for exhibition. The bailee is obliged to pay for the ordinary expenses for the use and
preservation of the thing loaned.
 Movable or immovable property may be the object of commodatum
(1937) (b) Loss of Thing Loaned
 If the subject matter is movable property, ordinarily it must be non- Article 1942, NCC. The bailee is liable for the loss of the thing, even
consumable. if it should be through a fortuitous event:
 Exception: Consumable goods may be the subject of commodatum (1) If he devotes the thing to any purpose different from that for
if the purpose of the contract is not the consumption of the object, which it has been loaned;
as when it is merely for exhibition (1936), called ‘‘commodatum ad (2) If he keeps it longer than the period stipulated, or after the
ostentationem. accomplishment of the use for which the commodatum has
been constituted;
Essentially Gratuitous (3) If the thing loaned has been delivered with appraisal of its value,
Article 1935, NCC. The bailee in commodatum acquires the use of unless there is a stipulation exempting the bailee from
the thing loaned but not its fruits; if any compensation is to be paid responsibility in case of a fortuitous event;
by him who acquires the use, the contract ceases to be a (4) If he lends or leases the thing to a third person, who is not a
commodatum. member of his household;
(5) If, being able to save either the thing borrowed or his own thing,
 The contract of commodatum is essentially gratuitous (1933[2]). he chose to save the latter.
 If any consideration is to be paid by him who acquires the use, the
contract ceases to be a commodatum (1935) The bailee is liable for the loss of the thing loaned if:
o If the consideration is in the form of payment of a price in (1) it was lost through his fault; or
money or its equivalent, the contract becomes lease of things (2) even if it should be lost through a fortuitous event:
(1643); (a) if he devotes the thing loaned to any purpose different from
o if the consideration is in some other form, such as the delivery that for which it has been loaned;
of another thing or rendition of service, the contract is (b) if he keeps it longer than the period stipulated, or after the
accomplishment of the use for which the commodatum has
innominate.
been constituted;
Purely Personal Contract (c) if the thing has been delivered with appraisal of its value,
unless there is a stipulation exempting the bailee from
Article 1939, NCC. Commodatum is purely personal in character.
responsibility in case of a fortuitous event;
Consequently:
(d) if he lends or leases the thing to a third person, who is not a
(1) The death of either the bailor or the bailee extinguishes the
member of his household; or
contract;
(e) if, being able to save either the thing borrowed or his own
(2) The bailee can neither lend nor lease the object of the contract
thing, he chose to save the latter.
to a third person. However, the members of the bailee’s
household may make use of the thing loaned, unless there is a
(c) Liability for Deterioration
stipulation to the contrary, or unless the nature of the thing
forbids such use. Article 1943, NCC. The bailee does not answer for the deterioration
of the thing loaned due only to the use thereof and without his fault.
Commodatum is purely personal in character. As consequences:
(1) the death of either the bailor or the bailee extinguishes the The bailee does not answer for the deterioration of the thing loaned due
contract only to the use thereof and without his fault.
(2) the bailee cannot allow third persons to use the thing borrowed,
unless expressly authorized by the bailor. (d) Liability of Two or More Bailees
Article 1945, NCC. When there are two or more bailees to whom a
However, the members of the bailee’s household are entitled to make thing is loaned in the same contract, they are liable solidarily.
use of the thing loaned, except: they are solidarity liable.
(1) when there is a stipulation to the contrary; or
(2) when the nature of the thing forbids such use by the members (e) Return of Thing Loaned
of the bailee’s household. (1) When to Return
In case of unauthorized delegation of use: Article 1946, NCC. The bailor cannot demand the return of the thing
loaned till after the expiration of the period stipulated, or after the
accomplishment of the use for which the commodatum has been provided the bailee brings the same to the knowledge of the bailor
constituted. However, if in the meantime, he should have urgent need before incurring them, except when they are so urgent that the reply
of the thing, he may demand its return or temporary use. to the notification cannot be awaited without danger.
In case of temporary use by the bailor, the contract of commodatum If the extraordinary expenses arise on the occasion of the actual use
is suspended while the thing is in the possession of the bailor. of the thing by the bailee, even though he acted without fault, they
shall be borne equally by both the bailor and the bailee, unless there
Upon expiration of the period stipulated or after the accomplishment of is a stipulation to the contrary.
the use agreed upon.’”
Rule: Extraordinary expenses for the preservation of the thing loaned
(2) Contract of Precarium shall be for the account of the bailor. (1949)
Article 1947, NCC. The bailor may demand the thing at will, and the
contractual relation is called a precarium, in the following cases: If Bailee Advances Such Expenses: He shall be entitled to a refund
(1) If neither the duration of the contract nor the use to which the provided he notified the bailor before incurring said expenses,
thing loaned should be devoted, has been stipulated; or except when they are so urgent that the reply to the notification cannot
(2) If the use of the thing is merely tolerated by the owner. be awaited without danger.
the bailor may demand for the return of the thing loaned at will in a Exception to Rule: If the extraordinary expenses arise on the occasion
contract of precarium, which exists when: of the actual use of the thing by the bailee, even though he acted
 the duration of the contract or the use to which the thing loaned without fault, the expenses shall be borne equally by both the bailor
should be devoted has not been stipulated; or and the bailee, unless there is a stipulation to the contrary.
 when the use of the thing loaned is merely tolerated by the owner.
(3) When Bailee Commits Acts of Ingratitude
Article 1948, NCC. The bailor may demand the immediate return of
the thing if the bailee commits any act of ingratitude specified in
article 765.
the bailor may demand immediate return of the thing if the bailee
commits any act of ingratitude specified in Article 765.
(4) Urgent Need by Bailor
Should the bailor have urgent need of the thing, he may demand its
return or temporary use, in which case the contract of commodatum is
suspended. (1496)
(5) Right of Retention

Article 1951, NCC. The bailor who, knowing the flaws of the thing
loaned, does not advise the bailee of the same, shall be liable to the
latter for the damages which he may suffer by reason thereof.
Article 1944, NCC. The bailee cannot retain the thing loaned on the
ground that the bailor owes him something, even though it may be by
reason of expenses. However, the bailee has a right of retention for
damages mentioned in article 1951.
Article 1952, NCC. The bailor cannot exempt himself from the
payment of expenses or damages by abandoning the thing to the
bailee.
 The bailee has the right to retain the thing borrowed only when the
bailor is liable for damages because the bailee suffered damages
by reason of the flaws or defects of the thing which are known to
the bailor but the latter did not advise the former of the existence of
the same (1951, in relation to 1944).
 The bailor cannot exempt himself from the payment of expenses or
damages by abandoning the thing to the bailee. (1952)
2. Obligations of the Bailor
Extraordinary Expenses
Article 1949, NCC. The bailor shall refund the extraordinary
expenses during the contract for the preservation of the thing loaned,
CONTRACT OF MUTUUM Article 1250, NCC. In case an extraordinary inflation or deflation of

the currency stipulated should supervene, the value of the currency
A. Nature and Characteristics of Mutuum at the time of the establishment of the obligation shall be the basis of
payment, unless there is an agreement to the contrary.
1. Characteristics of Contract
Article 1955, NCC. The obligation of a person who borrows money
Article 1953, NCC. A person who receives a loan of money or any shall be governed by the provisions of articles 1249 and 1250 of this
other fungible thing acquires the ownership thereof, and is bound to Code.
pay to the creditor an equal amount of the same kind and quality.
If what was loaned is a fungible thing other than money, the debtor
(a) Purpose: to consume the thing borrowed. owes another thing of the same kind, quantity and quality, even if it
(b) Transfer of Ownership: In mutuum, ownership passes to the should change in value. In case it is impossible to deliver the same
borrower (1933[4]), hence the obligation of the borrower is to kind, its value at the time of the perfection of the loan shall be paid.
repay the loan with an equal amount of the same kind and quality.
(1933, 1953) (a) In Loan of Money
(c) Subject matter: Unlike in commodatum, the object of mutuum is The obligation of a person who borrows money shall be governed by
always personal property, which must be either money or other Articles 1249 and 1250 (1955). Hence, the rules on legal tender and
consumable property. extraordinary infiation and deflation in Obligations and Contracts
(d) Consideration: Unlike in commodatum which is always gratuitous, are applicable.
mutuum may either be gratuitous or with a stipulation to pay
interest. (b) In Loan of Other Consumable Not Money
The debtor owes another thing of the same kind, quantity, and quality,
2. Transfer of Ownership even if it should change in value. In case it is impossible to deliver the
same kind, its value at the time of the perfection of the loan shall be paid.
Article 1980, NCC. Fixed, savings, and current deposits of money in (1955)
banks and similar institutions shall be governed by the provisions
concerning simple loan. 2. Obligation to Pay Interest
(a) Bank Deposits (a) Two Kinds of Interest

 Whether fixed, savings, or current deposits are in the nature of a
contract of mutuum. Article 1956, NCC. No interest shall be due unless it has been
 There is a debtor-creditor relationship between the bank and its expressly stipulated in writing.
depositor. The bank is the debtor and the depositor is the creditor.
The depositor lends the bank money and the bank agrees to pay Article 2209, NCC. If the obligation consists in the payment of a sum
the depositor on demand. (Consolidated Bank v. CA) of money, and the debtor incurs in delay, the indemnity for damages,
(b) Cash Advances there being no stipulation to the contrary, shall be the payment of the
A cash advance is in the nature of simple loan (mutuum), where interest agreed upon, and in the absence of stipulation, the legal
ownership over the money passes to the employee, hence, no fiduciary interest, which is six per cent per annum.
relationship is created. Therefore, an employee who availed of cash
advances may not be held liable for estafa for failure to liquidate (1) Monetary Interest - it refers to the compensation set by the parties
the same because he has no obligation to return the same money for the use or forbearance of money (Sun Life of Canada v. Tan Kit)
which he had received. (Yong Chan Kim v. People) (2) Compensatory Interest
 it refers to the penalty or indemnity for damages imposed by
(c) Money Market Transactions law or by the courts.
 A money market transaction is in the nature of a loan. (Cebu o The former is the interest referred to in Article 1956; while the
International Finance Corp. v. CA) latter is the interest mentioned in Article 2209.
 In this transaction, the investor is a lender who loans his money to  Accordingly, the right to recover interest arises only either by
a borrower through a middleman or dealer. (Sesbreño v. CA) virtue of a contract (monetary interest) or as damages for
delay or failure to pay the principal loan on which the interest is
B. Obligation of Borrower demanded (compensatory interest). (Isla v. Estorga)
1. In General (b) Rule on Monetary Interest

Article 1249, NCC. The payment of debts in money shall be made in
the currency stipulated, and if it is not possible to deliver such Requirement to Become Civil Obligation
currency, then in the currency which is legal tender in the Philippines. Article 1960, NCC. If the borrower pays interest when there has
been no stipulation therefor, the provisions of this Code concerning
The delivery of promissory notes payable to order, or bills of solutio indebiti, or natural obligations, shall be applied, as the case
exchange or other mercantile documents shall produce the effect of may be.
payment only when they have been cashed, or when through the fault
of the creditor they have been impaired. In order for the payment of monetary interest to become a case of civil
obligation, Article 1956 requires two requisites:
In the meantime, the action derived from the original obligation shall (1) there must be an express stipulation for the payment of interest
be held in abeyance. (2) the agreement for its payment must be reduced in writing.
 Article 1956 refers only to monetary interest (Siga-an v.
Villanueva).
 If there is an agreement for the payment of monetary interest but  If the debt produces interest, payment of the principal shall not
not reduced in writing, there is only a natural obligation to pay the be deemed to have been made until the interests have been
same. (1960) covered. (1243)
 While this rule is obligatory upon the debtor; the creditor may,
Limitation on Rate of Interest Agreed Upon however, agree on the application of the payment to the
 While the Usury Law remains to be suspended by virtue of Central principal prior to the payment of the interest. (Magdalena Estates
Bank Circular No. 905, s. 1982, effective on January 1, 1983 (Ruiz v. Rodriguez)
v. CA) and the parties are free to stipulate their preferred rate,
courts are allowed to equitably temper interest rates that are (c) Rules on Compensatory Interest
found to be excessive, iniquitous, unconscionable, and/or (1) Not Required to be Agreed in Writing
exorbitant. (Isla)
 In such instances, only the unconscionable interest rate is  When an obligation, regardless of its source, i.e., law, contracts,
nullified and deemed not written in the contract; whereas the quasi-contracts, delicts, or quasi-delicts, is breached, the
parties’ agreement on the payment of interest on the principal loan contravenor can be held liable for damages. (Eastern Shipping v.
obligation subsists. CA)
 It is as if the parties failed to specify the interest rate to be imposed  This is the concept of compensatory interest. The payment of
on the principal amount, in which case the legal rate of interest compensatory interest need not be reduced in writing. As
prevailing at the time the agreement was entered into is applied by discussed earlier, Article 1956 refers only to monetary interest.
the Court.
(2) Rate of Compensatory Interest
If Rate Not Agreed Upon
If there is an agreement for the payment of monetary interest in writing Article 2209, NCC. If the obligation consists in the payment of a sum
but the parties failed to specify the rate of interest, the legal rate of of money, and the debtor incurs in delay, the indemnity for damages,
interest shall apply. (Abella v. Abella) there being no stipulation to the contrary, shall be the payment of the
interest agreed upon, and in the absence of stipulation, the legal
Legal Rate for Loan or Forbearance of Money interest, which is six per cent per annum.
The legal rate of interest for the loan or forbearance of any money,
goods, or credits accruing before July 1, 2013 (or from June 30, 2013  If the obligation consists in the payment of a sum of money, and
and downwards) is still 12% p.a., while the legal rate beginning July 1, the debtor incurs in delay, the indemnity for damages
2013 is 6% p.a. (BSP Circular No 799; Nakar v. Gallery Frames) (compensatory interest) shall be the payment of the interest
agreed upon (2209; Eastern Shipping)
Payment of Interest on Accrued Interest o however, courts may also declare the rate agreed upon as
Article 1959, NCC. Without prejudice to the provisions of article iniquitous and unconscionable penalty interest, in which
2212, interest due and unpaid shall not earn interest. However, the case it shall be reduced to the legal rate. (Segovia v. JL
contracting parties may by stipulation capitalize the interest due and Dumatol Realty)
unpaid, which as added principal, shall earn new interest.  If the obligation consists in the payment of a sum of money, and
the debtor incurs in delay, in the absence of stipulation:
Article 2212, NCC. Interest due shall earn legal interest from the time o the rate of interest (legal rate) shall be 12% p.a. until June 30,
it is judicially demanded, although the obligation may be silent upon 2013 and
this point. o 6% p.a. beginning July 1, 2013
o The new rate of 6% p.a. can only be applied prospectively
As a rule, interest due and unpaid (called “accrued interest”) shall beginning July 1, 2013, not retroactively. (Nakar)
not earn interest (1959), unless:  When an obligation, not constituting a loan or forbearance of
(1) the parties, by stipulation, have agreed to capitalize the interest money, is breached, an interest on the amount of damages
due and unpaid, which, as added principal, shall earn new interest; awarded may be imposed at the discretion of the court at the rate
or of 6% per annum.63’
(2) the interest due is already judicially demanded, in which case,  When the judgment of the court awarding a sum of money becomes
it shall earn legal interest although the obligation may be silent final and executory, the rate of legal interest, whether the obligation
upon this point. (2212) constitutes a loan or forbearance of money or not, shall be 6% per
annum from such finality until its satisfaction, this interim period
As to the application of Article 2212, it contemplates the presence of being deemed to be by then an equivalent to a forbearance of
stipulated or conventional interest which has accrued when demand credit.640 However, judgments that have become final and
was judicially made (David v. CA). executory prior to July 1, 2013, shall not be disturbed and shall
 In cases where no monetary interest had been stipulated by the continue to be implemented applying the rate of interest fixed
parties, no accrued monetary interest could further earn therein.64'
compensatory interest upon judicial demand. (Isla)
Presumption of Payment of Interest

The receipt of the principal by the creditor, without reservation with
respect to the interest, shall give rise to the presumption that said
interest has been paid. (1176) This presumption, however, may be
rebutted by evidence to the contrary.
Rule in Application of Payments

CONTRACT OF DEPOSIT o even without an agreement, if the depositary is engaged in the

business of storing goods.
A. Nature and Characteristics  If the deposit is gratuitous, it is a unilateral contract
because all the obligations devolve upon the depositary
1. Concept and none on the depositor.
 However, if the deposit is for compensation, it becomes
Article 1962, NCC. A deposit is constituted from the moment a a bilateral contract.
person receives a thing belonging to another, with the obligation of
safely keeping it and of returning the same. If the safekeeping of the 2. Kinds of Deposit
thing delivered is not the principal purpose of the contract, there is no
deposit but some other contract. General Classification
Article 2005, NCC. A judicial deposit or sequestration takes place
Definition: A deposit is constituted from the moment a person receives when an attachment or seizure of property in litigation is ordered.
a thing belonging to another, with the obligation of safely keeping it
and of returning the same. (1) Extrajudicial Deposit: where the deposit is constituted by the
 The parties are the depositor (depositante), he who delivers the will of the parties and only corporeal movable property may be
thing to another under circumstances coming within the definition its object;
of deposit, and the depositary (depositario), he to whom the thing (2) Judicial Deposit: it is the court order that gives rise to this kind
is delivered. of deposit and it takes place when an attachment or seizure of
property in litigation is ordered. (2005)
Principal Purpose: The principal purpose of the contract is o As to judicial deposit, the object may either be movable or
safekeeping. If the safekeeping of the thing delivered is not the immovable property. (2006)
principal purpose of the contract, there is no deposit but some other
contract. Thus, in the case of valet parking the contract entered into is Classification of Extrajudicial Deposit
one of deposit; while in an ordinary car parking the contract entered into Article 1968, NCC. A voluntary deposit is that wherein the delivery
is one of lease of things. is made by the will of the depositor. A deposit may also be made by
two or more persons each of whom believes himself entitled to the
Real Contract thing deposited with a third person, who shall deliver it in a proper
Article 1963, NCC. An agreement to constitute a deposit is binding, case to the one to whom it belongs.
but the deposit itself is not perfected until the delivery of the thing.
Article 1996, NCC. A deposit is necessary:
Article 1316, NCC. Real contracts, such as deposit, pledge and (1) When it is made in compliance with a legal obligation;
commodatum, are not perfected until the delivery of the object of the (2) When it takes place on the occasion of any calamity, such as
obligation. fire, storm, flood, pillage, shipwreck, or other similar events.
 Rule: The contract of deposit itself is a real contract—it is not Article 1997, NCC. The deposit referred to in No. 1 of the preceding
perfected until the delivery of the thing. (1963, 1316) article shall be governed by the provisions of the law establishing it,
 Consensual Contract: However, an agreement to constitute a and in case of its deficiency, by the rules on voluntary deposit.
deposit is binding, but such is not the contract of deposit itself. The
same is a consensual contract and such agreement shall give rise The deposit mentioned in No. 2 of the preceding article shall be
to an obligation to do and to an action for damages in case of regulated by the provisions concerning voluntary deposit and by
breach. article 2168.
Subject Matter (1) Voluntary Deposit: where the deposit is made by the will of the
Article 1966, NCC. Only movable things may be the object of a depositor. (1968)
deposit. (2) Necessary Deposit: where the deposit is not by reason of the
depositor’s will but it takes place when:
Article 2006, NCC. Movable as well as immovable property may be (a) it is made in compliance with a legal obligation; or
the object of sequestration. (b) it takes place on the occasion of any calamity, such as fire,
storm, flood, pillage, shipwreck, or other similar events. (1996)
 Extrajudicial Deposit: Only movable things may be the object of (i) The first is governed by the law establishing it; while the
a deposit (1966). Necessarily, the movable must be corporeal second is governed by the rules on voluntary deposit.
considering the purpose of the contract. (1997)
 Judicial Deposit: Movable as well as immovable property may be
the object of sequestration or judicial deposit (2006) Form of deposit
Article 1969, NCC. A contract of deposit may be entered into orally
Compensation or in writing.
Article 1965, NCC. A deposit is a gratuitous contract, except when
there is an agreement to the contrary, or unless the depositary is A contract of deposit may be entered into orally or in writing.
engaged in the business of storing goods.
Extinguishment of Voluntary Deposit
 GR: Generally, it is a gratuitous contract. Article 1995, NCC. A deposit is extinguished:
(1) Upon the loss or destruction of the thing deposited;
 EXC: It is for a compensation when:
(2) In case of a gratuitous deposit, upon the death of either the
o there is an agreement to that effect; or
depositor or the depositary.
A deposit is extinguished:  However, if there is a stipulation that the thing should be returned
(1) upon the loss or destruction of the thing deposited; or to one of the depositors, the depositary shall return it only to the
(2) in case of a gratuitous deposit, upon the death of either the person designated.
depositor or the depositary.
(5) When Depositor is Incapacitated
B. Voluntary Deposit Article 1970, NCC. If a person having capacity to contract accepts a
deposit made by one who is incapacitated, the former shall be subject
1. Parties to all the obligations of a depositary, and may be compelled to return
the thing by the guardian, or administrator, of the person who made
Depositor the deposit, or by the latter himself if he should acquire capacity.
(1) Need Not Be Owner
Article 1984, NCC. The depositary cannot demand that the depositor Article 1986, NCC. If the depositor should lose his capacity to
prove his ownership of the thing deposited. contract after having made the deposit, the thing cannot be returned
except to the persons who may have the administration of his
Nevertheless, should he discover that the thing has been stolen and property and rights.
who its true owner is, he must advise the latter of the deposit.
 If the depositor is incapacitated but the depositary is capacitated,
If the owner, in spite of such information, does not claim it within the the latter is subject to all the obligations of a depositary, and
period of one month, the depositary shall be relieved of all may be compelled to return the thing by the guardian, or
responsibility by returning the thing deposited to the depositor. administrator, of the depositor, or by the latter himself if he should
acquire capacity. (1970)
If the depositary has reasonable grounds to believe that the thing has  If the depositor should lose his capacity to contract after having
not been lawfully acquired by the depositor, the former may return been made the deposit, the thing cannot be returned except to the
the same. persons who may have the administration of his property and
rights. (1986)
 It is not essential that the depositor be the owner of the thing
deposited. The depositary cannot demand that the depositor prove Depositary
his ownership of the thing deposited. (1984) Article 1971, NCC. If the deposit has been made by a capacitated
 A deposit constituted by a non-owner of the thing is valid person with another who is not, the depositor shall only have an
between the parties, but the owner is not precluded from action to recover the thing deposited while it is still in the possession
exercising reinvindicatory action against the depositary. of the depositary, or to compel the latter to pay him the amount by
which he may have enriched or benefited himself with the thing or its
(2) Remedy of Depositary price. However, if a third person who acquired the thing acted in bad
If the depositary has reasonable grounds to believe that the thing has faith, the depositor may bring an action against him for its recovery.
not been lawfully acquired by the depositor, he may return the same.
When Depositary is Incapacitated: If the depositary is incapacitated
(3) When Depositary Discovered Thing Was Stolen while the depositor is capacitated, the depositor shall have an action
 Should the depositary discover that the thing deposited has been against the depositary only in the following situations:
stolen and who its true owner is, the depositary is required to (1) when the thing is still in the possession of the depositary, in which
advise the latter of the deposit. case an action for recovery may be resorted to; or
 If the owner, in spite of such information, does not claim it within (2) when the depositary himself is enriched or benefited by the price of
one month, the depositary shall be relieved of all responsibility the thing, in which case an action for recovery of the said sum may
by returning the thing deposited to the depositor. be resorted to.
If the thing is already in possession of a third person, an action for
(4) Deposit by Two or More Persons recovery may be resorted against such third person if the latter acquired
Article 1985, NCC. When there are two or more depositors, if they the thing in bad faith. (1971)
are not solidary, and the thing admits of division, each one cannot
demand more than his share. 2. Rights and Obligations of the Depositary
When there is solidarity or the thing does not admit of division, the (a) Use of Thing Deposited
provisions of articles 1212 and 1214 shall govern. However, if there RULE
is a stipulation that the thing should be returned to one of the Article 1977, NCC. The depositary cannot make use of the thing
depositors, the depositary shall return it only to the person deposited without the express permission of the depositor.
designated.
Otherwise, he shall be liable for damages.
 A deposit may also be made by two or more persons, each of whom
believes himself entitled to the thing deposited with a third person, However, when the preservation of the thing deposited requires its
who shall deliver it in a proper case to the one to whom it belongs. use, it must be used but only for that purpose.
(1968)
 When there are two or more depositors, if they are not solidary, The depositary cannot make use of the thing deposited without the
and the thing admits of division, each cannot demand more than express permission of the depositor. Otherwise, he shall be liable for
his share. (1985) damages.
 When there is solidarity or the thing does not admit of division,
the depositary may return the thing to any one of them; but if any Exception: When the preservation of the thing deposited requires
demand, judicial or extrajudicial, has been made by one of them, its use, it must be used but only for that purpose.
the thing should be returned to him. (1985 in relation to 1214)
Effect of Permission to Use

Article 1978, NCC. When the depositary has permission to use the As regards the value of the thing deposited, the statement of the
thing deposited, the contract loses the concept of a deposit and depositor shall be accepted, when the forcible opening is imputable
becomes a loan or commodatum, except where safekeeping is still to the depositary, should there be no proof to the contrary. However,
the principal purpose of the contract. the courts may pass upon the credibility of the depositor with respect
to the value claimed by him.
The permission shall not be presumed, and its existence must be
proved. When the seal or lock is broken, with or without the depositary’s fault,
he shall keep the secret of the deposit.
Article 1943, NCC. The bailee does not answer for the deterioration
of the thing loaned due only to the use thereof and without his fault.  The depositary must return it in the same condition, and he shall
be liable for damages should the seal or lock be broken through his
Article 1935, NCC. The bailee in commodatum acquires the use of fault. (1681)
the thing loaned but not its fruits; if any compensation is to be paid o Fault on the part of the depositary is presumed, unless
by him who acquires the use, the contract ceases to be a there is proof to the contrary.
commodatum.  As regards the value of the thing deposited, the statement of the
depositor shall be accepted, when the forcible opening is imputable
 If safekeeping remains the principal purpose of the contract, the to the depositary, should there be no proof to the contrary.
contract is still deposit; o However, the courts may pass upon the credibility of the
 otherwise, the contract loses the concept of a deposit and becomes depositor with respect to the value claimed by him.
a loan or commodatum, if gratuitous (1978), or becomes a contract
of lease of things, if a price is paid as consideration. (1943, 1935) When Authorized to Open
Article 1982, NCC. When it becomes necessary to open a locked
(b) Duty of safe-keeping box or receptacle, the depositary is presumed authorized to do so, if
the key has been delivered to him; or when the instructions of the
Standard depositor as regards the deposit cannot be executed without opening
Article 1163, NCC. Every person obliged to give something is also the box or receptacle.
obliged to take care of it with the proper diligence of a good father of
a family, unless the law or the stipulation of the parties requires When it becomes necessary to open a locked box or receptacle, the
another standard of care. depositary is presumed authorized to do so,
 if the key has been delivered to him; or
Article 1972, NCC. The depositary is obliged to keep the thing safely  when the instructions of the depositor as regards the deposit
and to return it, when required, to the depositor, or to his heirs and cannot be executed without opening the box or receptacle.
successors, or to the person who may have been designated in the
contract. His responsibility, with regard to the safekeeping and the Duty to Keep Secret of Deposit
loss of the thing, shall be governed by the provisions of Title I of this When the seal or lock is broken, with or without the depositary’s fault, he
Book. shall keep the secret of the deposit. (1981)
If the deposit is gratuitous, this fact shall be taken into account in (d) Authority to Deposit With Third Person
determining the degree of care that the depositary must observe. Rule: Unless there is a stipulation to the contrary, the depositary cannot
deposit the thing with a third person. (1973)
 He is required to observe the diligence which is expected of a good
father of a family, unless a different degree has been stipulated by When Deposited With Someone Manifestly Unfit
the parties (1163 IRT 1972). Article 1973, NCC. Unless there is a stipulation to the contrary, the
 However, if the deposit is gratuitous, this fact shall be taken into depositary cannot deposit the thing with a third person. If deposit with
account in determining the degree of care that the depositary must a third person is allowed, the depositary is liable for the loss if he
observe. deposited the thing with a person who is manifestly careless or unfit.
The depositary is responsible for the negligence of his employees.
Rule as to Safety Deposit Boxes
 It is not an ordinary contract of lease but, at the same time, it is not If deposit with a third person is allowed, the depositary is liable for the
an ordinary deposit but a special kind of deposit. (CA Agro- loss if he deposited the thing with a person who is manifestly careless
Industrial Dev. v. CA) or unfit.
 The primary function is still found within the parameters of a
contract of deposit, i.e., the receiving in custody of funds, (e) Liability for Loss of Thine
documents, and other valuable objects for safekeeping. Rule: Liable only if thing is lost thru his fault.
(c) Duty When Thing is Delivered Closed and Sealed Exception

Rule Article 1979, NCC. The depositary is liable for the loss of the thing
Article 1981, NCC. When the thing deposited is delivered closed and through a fortuitous event:
sealed, the depositary must return it in the same condition, and he (1) If it is so stipulated;
shall be liable for damages should the seal or lock be broken through (2) If he uses the thing without the depositor’s permission;
his fault. (3) If he delays its return;
(4) If he allows others to use it, even though he himself may have
Fault on the part of the depositary is presumed, unless there is proof been authorized to use the same.
to the contrary.
He becomes liable for the loss of the thing by reason of fortuitous event o However, even if the period has not yet expired the depositary
in the following instances: may return the thing:
(1) if it is so stipulated;  if the depositary has reasonable grounds to believe that
(2) if he uses the thing without the depositor’s permission; the thing has not been lawfully acquired by the depositor;
(3) if he delays its return; or (1984) or
(4) if he allows others to use it, even though he himself may have been  if the depositary may have justifiable reasons for not
authorized to use the same. (1979) keeping the thing deposited, unless the deposit is for a
valuable consideration. (1989)
(f) Obligation to Return Thing Deposited
What to Return to Depositor 3. Obligations of Depositor
Article 1983, NCC. The thing deposited shall be returned with all its
products, accessories and accessions. (a) Reimbursement of Expenses for Preservation
Article 1992, NCC. If the deposit is gratuitous, the depositor is
Should the deposit consist of money, the provisions relative to agents obliged to reimburse the depositary for the expenses he may have
in article 1896 shall be applied to the depositary. incurred for the preservation of the thing deposited.
Article 1986, NCC. If the depositor should lose his capacity to The depositor is obliged to reimburse the depositary for the expenses
contract after having made the deposit, the thing cannot be returned the latter may have incurred for the preservation of the thing
except to the persons who may have the administration of his deposited only when the deposit is gratuitous.
property and rights.
(b) Reimbursement for Losses Arising from Character of Thing
 The thing deposited, including all its products, accessories, and Deposited
accessions. Article 1993, NCC. The depositor shall reimburse the depositary for
 If the subject matter of the deposit consists of money, the any loss arising from the character of the thing deposited, unless at
depositary is not liable for interest. the time of the constitution of the deposit the former was not aware
 However, the depositary is liable for interest on sums he has of, or was not expected to know the dangerous character of the thing,
applied to his own use and on those which he still owes after or unless he notified the depositary of the same, or the latter was
the extinguishment of the deposit. (1983 IRT 1986) aware of it without advice from the depositor.
When to Return The depositor shall reimburse the depositary for any loss arising
Article 1988, NCC. The thing deposited must be returned to the from the character of the thing deposited, unless:
depositor upon demand, even though a specified period or time for (1) at the time of the constitution of the deposit the depositor was not
such return may have been fixed. aware of, or was not expected to know the dangerous
character of the thing;
This provision shall not apply when the thing is judicially attached (2) the depositor notified the depositary of the same; or
while in the depositary’s possession, or should he have been notified (3) the depositary was aware of it without advice from the depositor.
of the opposition of a third person to the return or the removal of the
thing deposited. In these cases, the depositary must immediately (c) Depositary Lien
inform the depositor of the attachment or opposition. Article 1994, NCC. The depositary may retain the thing in pledge
until the full payment of what may be due him by reason of the
Article 1984, NCC. The depositary cannot demand that the depositor deposit.
prove his ownership of the thing deposited.
The depositary may retain the thing in pledge until the full payment of
Nevertheless, should he discover that the thing has been stolen and what may be due him by reason of the deposit.
who its true owner is, he must advise the latter of the deposit.
C. Necessary Deposit in Hotels or Inns
If the owner, in spite of such information, does not claim it within the
period of one month, the depositary shall be relieved of all 1. Deposit of Effects in Hotels or Inns
responsibility by returning the thing deposited to the depositor.
Deposit of Effects in Hotels or Inns
If the depositary has reasonable grounds to believe that the thing has (a) Concept
not been lawfully acquired by the depositor, the former may return Article 1998, NCC. The deposit of effects made by travellers in
the same. hotels or inns shall also be regarded as necessary. The keepers of
hotels or inns shall be responsible for them as depositaries, provided
Article 1986, NCC. If the depositor should lose his capacity to that notice was given to them, or to their employees, of the effects
contract after having made the deposit, the thing cannot be returned brought by the guests and that, on the part of the latter, they take the
except to the persons who may have the administration of his precautions which said hotel-keepers or their substitutes advised
property and rights. relative to the care and vigilance of their effects.
 The thing deposited must be returned to the depositor upon  The deposit of effects made by travelers in hotels or inns shall also
demand, even though a specified period or time for such return be regarded as necessary and the keepers of hotels or inns shall
may have been fixed. (1988) also be regarded as depositaries.
 On the part of the depositary, he cannot return the thing  As such depositaries, hotels and inns are liable for the safety of
deposited before the expiration of the period agreed upon. the effects introduced in its premises.
(b) Extent of Liability

(d) When Keepers of Hotels or Inns Not Liable

Article 1999, NCC. The hotel-keeper is liable for the vehicles, Article 2000, NCC. The responsibility referred to in the two preceding
animals and articles which have been introduced or placed in the articles shall include the loss of, or injury to the personal property of
annexes of the hotel. the guests caused by the servants or employees of the keepers of
hotels or inns as well as by strangers; but not that which may proceed
Article 2000, NCC. The responsibility referred to in the two preceding from any force majeure. The fact that travellers are constrained to
articles shall include the loss of, or injury to the personal property of rely on the vigilance of the keeper of the hotel or inn shall be
the guests caused by the servants or employees of the keepers of considered in determining the degree of care required of him.
hotels or inns as well as by strangers; but not that which may proceed
from any force majeure. The fact that travellers are constrained to Article 2001, NCC. The act of a thief or robber, who has entered the
rely on the vigilance of the keeper of the hotel or inn shall be hotel is not deemed force majeure, unless it is done with the use of
considered in determining the degree of care required of him. arms or through an irresistible force.
Article 2001, NCC. The act of a thief or robber, who has entered the Article 2002, NCC. The hotel-keeper is not liable for compensation
hotel is not deemed force majeure, unless it is done with the use of if the loss is due to the acts of the guest, his family, servants or
arms or through an irresistible force. visitors, or if the loss arises from the character of the things brought
into the hotel.
(1) The hotel-keeper is liable even for the vehicles, animals, and
articles which have been introduced or placed in the The keepers of hotels or inns shall not be liable for the loss of, or injury
annexes of the hotel; (1999) to the personal property of the guests, in the following situations:
(2) the responsibility of the hotels or inns shall include the loss (1) when it is caused by force majeure —but the act of a thief or
of, or injury to the personal property of the guests caused robber who has entered the hotel is not deemed force majeure,
by the servants or employees of the keepers of hotels or unless it is done with the use of arms or through irresistible force;
inns as well as by strangers; but not that which may (2000, 2001)
proceed from any force majeure. (2000) (2) when such loss or injury is due to the acts of the guest, his
(i) The act of a thief or robber, who has entered the family, servants, or visitors (2002), provided that the hotel-
hotel, is not deemed force majeure, unless it is done keeper is not guilty of concurrent negligence or has not
with the use of arms or through an irresistible force. contributed in any degree to the occurrence of the loss
(2001) because a depositary is not responsible for the loss of goods by
theft, unless his actionable negligence contributes to the loss (YHT
(c) Requisites for liability Realty Corp. v. CA); or
Article 1998, NCC. The deposit of effects made by travellers in (3) when such loss or injury arises from the character of the things
hotels or inns shall also be regarded as necessary. The keepers of brought into the hotel. (2002)
hotels or inns shall be responsible for them as depositaries, provided
that notice was given to them, or to their employees, of the effects (e) Innkeeper’s Lien
brought by the guests and that, on the part of the latter, they take the The hotel-keeper has a right to retain the things brought into the hotel
precautions which said hotel-keepers or their substitutes advised by the guest as a security for credits on account of lodging and supplies
relative to the care and vigilance of their effects. usually furnished to hotel guests. This is called the “innkeeper’s lien.”
Article 2003, NCC. The hotel-keeper cannot free himself from (f) Liability for Safety of Guests
responsibility by posting notices to the effect that he is not liable for  The hotel business is imbued with public interest; hotelkeepers
the articles brought by the guest. Any stipulation between the hotel- are bound to provide not only lodging for their guests but also
keeper and the guest whereby the responsibility of the former as set security to the persons and belongings of their guests.
forth in articles 1998 to 2001 is suppressed or diminished shall be  While there is no law expressly obligating hotels to ensure the
void. safety of its guests, the Court has ruled that if hotels are required
to ensure the safety of the personal effects of hotel guests, it
The keepers of hotels or inns shall be liable for the safety of the personal is with greater reason that hotels should be tasked with the
effects introduced by hotel guests provided that: responsibility of ensuring the personal safety of their guests,
(1) notice was given to the keepers, or to their employees, of the applying by analogy Articles 2000, 2001, and 2002.
effects brought by the guests; and  But hotels shall not be liable if it can prove that it exercised due
(2) the guests take the precautions which the hotels or inns advised diligence in order to prevent damage. (Makati Shangri-la Hotel
relative to the care and vigilance of their effects. (1998) v. Harper)
 To hold hotelkeepers or innkeepers liable for the effects of their

guests, it is not necessary that they be actually delivered to the
innkeepers or their employees.
 It is enough that such effects are within the hotel or inn. (De Los
Santos v. Tan Khey)
 But the hotel-keeper cannot free himself from responsibility by
posting notices to the effect that he is not liable for the articles
brought by the guest.
o Any stipulation between the hotel-keeper and the guest
whereby the responsibility of the former is suppressed or
diminished shall be void. (2003)
PART 7: ACCESSORY CONTRACTS  It is only the undertaking of the guarantor that is required to be
in writing; the consent of the creditor (or the acceptance of the
CONTRACTS OF GUARANTY AND SURETYSHIP guaranty) may be proven by parol evidence.
A. Concept of Accessory Contracts 2. Kinds of Guaranty
1. Accessory Contracts (a) According to Source

(1) Conventional – that which is created by agreement of the
Definition: An accessory contract is one that cannot exist without a parties;
valid principal contract. In our law, the term “accessory contract” is (2) Legal – that which is constituted in compliance with a
synonymous with contracts of guaranty or security. provision of law; or
(3) Judicial - that which the court requires in order to secure the
Two Kinds of Accessory Contracts eventual right of a party to a legal action or proceeding.
(1) Contracts of Personal Security – the faithful performance of the (b) According to Consideration
obligation by the principal debtor is secured by the personal Article 2048, NCC. A guaranty is gratuitous, unless there is a
commitment of another (the guarantor or surety), such as the stipulation to the contrary.
contracts of guaranty proper and suretyship; (Acme Shoe v. CA)
(2) Contracts of Real Security – the faithful performance of the (1) Gratuitous — where the guarantor receives no compensation
obligation of the debtor is secured by a specific property, such that for guaranteeing the principal obligation. A guaranty is
if the principal obligation becomes due and the debtor defaults, basically gratuitous; (2048) however, gratuitousness is not its
then the property encumbered can be alienated for the payment of essence because the parties may stipulate to the contrary.
the obligation. (2) Onerous – where the guarantor receives consideration for
guaranteeing the principal obligation.
B. Contract of Guaranty Proper (c) According to Person Guaranteed
(1) Simple – where the obligation secured is that of the principal
1. Concept, Nature, and Characteristics debtor; or
(2) Double – where the obligation secured is that of the first or
(a) Definition anterior guarantor, also called “sub-guaranty.”
Article 2041, NCC. If one of the parties fails or refuses to abide by
the compromise, the other party may either enforce the compromise C. Contract of Suretyship
or regard it as rescinded and insist upon his original demand.
1. Nature and Characteristics
By guaranty a person, called the guarantor, binds himself to the creditor
to fulfill the obligation of the principal debtor in case the latter should fail (a) Definition
to do so. (2041[1]) Article 2047, NCC. By guaranty a person, called the guarantor, binds
himself to the creditor to fulfill the obligation of the principal debtor in
(b) Accessory Contract case the latter should fail to do so.
A guaranty is an accessory contract in the sense that it is entered into
for the purpose of securing the performance of another obligation If a person binds himself solidarily with the principal debtor, the
which is denominated as the principal obligation. (Atok Finance v. CA) provisions of Section 4, Chapter 3, Title I of this Book shall be
observed. In such case the contract is called a suretyship.
(c) Guarantor Cannot be Debtor Himself
 Another peculiar characteristic of guaranty is that the guarantor is  A suretyship is created when a guarantor binds itself solidarily
a person distinct from the person guaranteed. with the principal obligor (International Finance Corp. v. Textile
 Thus, a person cannot be both the primary debtor and the Mills).
guarantor of his own debt, for it is inconsistent with the very'  Article 2047 provides that suretyship arises upon the solidary
purpose of a guarantee which is for the creditor to proceed against binding of a person deemed the surety with the principal debtor for
a third person if the debtor defaults in his obligation. (Velasquez v. the purpose of fulfilling an obligation. (Prudential Guarantee v.
Solidbank, Corp.) Equinox Land Corp.)
(d) Obligation of Guarantor is Subsidiary (b) Accessory Contract

 A contract of guaranty gives rise to a subsidiary obligation on the The surety’s obligation is not an original and direct one for the
part of the guarantor. performance of his own act, but merely accessory or collateral to the
 It is only after the creditor has proceeded against the obligation contracted by the principal. (Garcia v. CA)
properties of the principal debtor and the debt remains
unsatisfied that a guarantor can be held liable to answer for any (c) Liability is Direct and Primary
unpaid amount. This is the principle of excussion. (Ong bv. PCIB)  Although a surety contract is in essence secondary only to a valid
principal obligation, his liability to the creditor or promisee of
(e) Unilateral Contract the principal is said to be direct, primary, and absolute; in other
The contract of guaranty is unilateral (The Texas Company v. Alonzo), words, he is directly and equally bound with the principal.
because what arises therefrom are solely obligations on the part of  Thus, a creditor can go directly against the surety although the
the guarantor in relation to the creditor. principal debtor is solvent and is able to pay or no prior demand is
made on the principal debtor. (Ong v. PCIB)
(f) Governed by Statute of Frauds
 The undertaking of the guarantor (but not the contract of guaranty (d) Governed by Statute of Frauds
itself) is covered by the Statute of Frauds (1403[2b]).
Suretyship is a contractual relation resulting from an agreement whereby (b) Obligations Covered
one person, the surety, engages to be answerable for the debt, default, (1) A guaranty or surety does not only cover present obligations
or miscarriage of another, known as the principal. Hence, a contract of of the principal debtor, but it may also secure future debts,
suretyship is covered by the Statute of Frauds. (1403[2b]) the amount of which is not yet known (2053)—and this is the
basis for contracts denominated as continuing guaranty or
(e) Consideration in Suretyship suretyship, or one which covers all transactions, including
 The surety becomes liable for the debt or duty of another although those arising in the future, which are within the description or
he possesses no direct or personal interest over the contemplation of the contract of guaranty, until the expiration
obligations nor does he receive any benefit therefrom. (Garcia v. or termination thereof. (Diño v. CA)
CA) (2) As a rule, a contract of guaranty or suretyship is only
 The consideration necessary to support a surety obligation prospective and not retroactive in operation (Socony
need not pass directly to the surety; a consideration moving to Vacuum, Corp. v. Miraflores), unless a contrary intent is
the principal alone will suffice. clearly shown (Pastoral v. Mutual Security Insurance). Hence,
when the parties to the contract clearly provided that the
(f) Distinguished from Solidary Debtor guaranty would cover “sums obtained and/or to be obtained,”
Surety Solidary Debtor the same can be given retroactive application. (Willex Plastic
the entire obligation there is a portion of the obligation that v. CA)
belongs to someone else properly pertains to him
upon payment of the entire he is not entitled to full reimbursement 2. Parties to Contract
obligation, the surety is of the amount he paid but may only
entitled to seek claim from his co-debtors the share (a) Who are Parties Thereto
reimbursement from the which corresponds to each, with Article 2050, NCC. If a guaranty is entered into without the
principal debtor for the interest for the payment already made knowledge or consent, or against the will of the principal debtor, the
amount paid provisions of articles 1236 and 1237 shall apply.
Escaño v. Ortigas
The contract of guaranty or suretyship is only between the guarantor or
2. Surety and Mere Guarantor Distinguished surety and the creditor. The principal debtor is not a party thereto. In fact,
the same may be entered into without the knowledge or consent, or even
Guarantor Surety against the will of the principal debtor.
does not bind himself solidarily surety binds himself solidarily
with the principal debtor with the principal debtor (b) Qualifications of Guarantor or Surety
entitled to the benefit of No excussion Article 2056, NCC. One who is obliged to furnish a guarantor shall
excussion present a person who possesses integrity, capacity to bind himself,
only secondarily liable principally liable and sufficient property to answer for the obligation which he
guarantees. The guarantor shall be subject to the jurisdiction of the
guaranty is an undertaking that suretyship is an undertaking that
court of the place where this obligation is to be complied with.
the debtor shall pay the debt shall be paid
guarantor agrees that the surety promises to pay the
creditor, after proceeding principal’s debt if the principal Article 2057, NCC. If the guarantor should be convicted in first
against the principal, may will not pay instance of a crime involving dishonesty or should become insolvent,
proceed against the guarantor if the creditor may demand another who has all the qualifications
the principal is unable to pay required in the preceding article. The case is excepted where the
guarantor is an insurer of the a surety is an insurer of the debt. creditor has required and stipulated that a specified person should
be the guarantor.
solvency of the debtor
(1) One who is obliged to furnish a guaranty is obliged to present

D. Principles Common to Both
a person who possesses integrity, capacity to bind himself,
and sufficient property to answer for the obligation which he
1. As to Subject Matter (Principal Obligation Guaranteed)
guarantees (2056)
(2) The subsequent conviction of the guarantor of a crime
(a) Nature of Principal Obligation Guaranteed
involving dishonesty or his becoming an insolvent does
Article 2052, NCC. A guaranty cannot exist without a valid obligation.
not terminate the contract but merely entitles the creditor
to demand a replacement of the guarantor. (2057)
Nevertheless, a guaranty may be constituted to guarantee the
(i) The option lies with the creditor.
performance of a voidable or an unenforceable contract. It may also
(ii) But where the guarantor is personally designated by the
guarantee a natural obligation.
creditor, the subsequent insolvency or dishonesty of the
guarantor shall not entitle the creditor to demand for
Article 2053, NCC. A guaranty may also be given as security for
replacement.
future debts, the amount of which is not yet known; there can be no
claim against the guarantor until the debt is liquidated. A conditional
3. Right to Reimbursement and Subrogation Upon Payment
obligation may also be secured.
(a) Applicability of Articles 2066 and 2067
(1) It must be a valid obligation (not void); (2052)
Article 2066, NCC. The guarantor who pays for a debtor must be
(2) it may be voidable or unenforceable;
indemnified by the latter.
(3) it may be a civil obligation or natural obligation; and
(4) it may also be a conditional obligation. (2053)
The indemnity comprises:
(1) The total amount of the debt;
(2) The legal interests thereon from the time the payment was If the debt was for a period and the guarantor paid it before it became
made known to the debtor, even though it did not earn interest due, he cannot demand reimbursement of the debtor until the expiration
for the creditor; of the period, unless the payment has been ratified by the debtor.744
(3) The expenses incurred by the guarantor after having notified the
debtor that payment had been demanded of him; From Whom May Guarantor Demand Reimbursement
(4) Damages, if they are due. Article 2072, NCC. If one, at the request of another, becomes a
guarantor for the debt of a third person who is not present, the
Article 2067, NCC. The guarantor who pays is subrogated by virtue guarantor who satisfies the debt may sue either the person so
thereof to all the rights which the creditor had against the debtor. requesting or the debtor for reimbursement.
If the guarantor has compromised with the creditor, he cannot  Ordinarily from the principal debtor.
demand of the debtor more than what he has really paid.  However, if one, at the request of another, becomes a guarantor
for the debt of a third person who is not present, the guarantor
 Article 2066 assures that “[t]he guarantor who pays for a debtor who satisfies the debt may sue either the person so requesting
must be indemnified by the latter,” such indemnity comprising of, or the debtor for reimbursement. (2072)
among others, “the total amount of the debt.”
 Further, Article 2067 likewise establishes that “the guarantor who (c) Right to subrogation
pays is subrogated by virtue thereof to all the rights which the (1) Rule
creditor had against the debtor.”
 The rights to indemnification and subrogation as established and Article 2067, NCC. The guarantor who pays is subrogated by virtue
granted to the guarantor by Articles 2066 and 2067 extend as well thereof to all the rights which the creditor had against the debtor.
to sureties as defined under Article 2047. (Escaño v. Ortigas)
If the guarantor has compromised with the creditor, he cannot
(b) Right to Reimbursement: demand of the debtor more than what he has really paid.
RULE: The guarantor who pays for a debtor must be indemnified by the
latter. (2066) The guarantor who pays is subrogated by virtue thereof to all the rights
which the creditor had against the debtor.
EXCEPTIONS
Article 2070, NCC. If the guarantor has paid without notifying the (2) In Case of Partial Payment
debtor, and the latter not being aware of the payment, repeats the
payment, the former has no remedy whatever against the debtor, but Guarantor is not yet entitled to subrogation. A guarantor cannot exercise
only against the creditor. Nevertheless, in case of a gratuitous the right of subrogation until the principal obligation has been fully
guaranty, if the guarantor was prevented by a fortuitous event from extinguished. (Somes v. Molina)
advising the debtor of the payment, and the creditor becomes
insolvent, the debtor shall reimburse the guarantor for the amount 4. Remedy of Guarantor Before Payment
paid.
What Remedy May be Exercised
 If the guarantor has paid without notifying the debtor, and the Article 2071, NCC. The guarantor, even before having paid, may
latter not being aware of the payment, repeats the payment, the proceed against the principal debtor: tiddde
guarantor has no remedy whatever against the debtor, but (1) When he is sued for the payment;
only against the creditor. (2) In case of insolvency of the principal debtor;
o Nevertheless, in case of a gratuitous guaranty, if the (3) When the debtor has bound himself to relieve him from the
guarantor was prevented by a fortuitous event from guaranty within a specified period, and this period has expired;
advising the debtor of the payment, and the creditor (4) When the debt has become demandable, by reason of the
becomes insolvent, the debtor shall reimburse the expiration of the period for payment;
guarantor for the amount paid. (2070) (5) After the lapse of ten years, when the principal obligation has
 If the guaranty is entered into without the knowledge or no fixed period for its maturity, unless it be of such nature that it
consent, or against the will of the principal debtor, the cannot be extinguished except within a period longer than ten
guarantor is entitled to indemnity only to the extent that the years;
payment has been beneficial to the debtor. (6) If there are reasonable grounds to fear that the principal debtor
o If the payment has not benefited the debtor at all, the intends to abscond;
guarantor does not acquire any valid claim for (7) If the principal debtor is in imminent danger of becoming
reimbursement. (2050 IRT 1236) insolvent.
In all these cases, the action of the guarantor is to obtain release from
Extent of Indemnity the guaranty, or to demand a security that shall protect him from any
The indemnity comprises of: proceedings by the creditor and from the danger of insolvency of the
(1) the total amount of the debt; debtor.
(2) the legal interest therefrom from the time the payment was made
known to the debtor, even though it did not earn interest for the The remedy that may be exercised is either to obtain release from the
creditor; guaranty, or to demand a security that shall protect him from any
(3) the expenses incurred by the guarantor after having notified the proceedings by the creditor and from the danger of insolvency of the
debtor that payment had been demanded of him; and debtor. (2071)
(4) damages, if they are due. (2066)
When Remedy May be Exercised (2071)
If Guarantor Pays Before Maturity Even before payment, in the following instances:
(1) when he is sued for payment;
(2) in case of insolvency of the principal debtor; material alteration of the contract (Carodan v. China
(3) when the debtor has bound himself to relieve him from the guaranty Banking).
within a specified period, and this period has expired; o In PNB v. Manila Surely (1965), the Court en banc declared
(4) when the debt has become demandable, by reason of the the surety discharged from liability on account of the creditor’s
expiration of the period for payment; negligence. In that case, the creditor failed to collect the
(5) after the lapse of ten years, when the principal obligation has no amounts due to the debtor contrary to the former’s duty to
fixed period for its maturity, unless it be of such nature that it cannot make collections as holder of an exclusive and irrevocable
be extinguished except within a period longer than ten years; power of attorney. The negligence of the creditor allowed
(6) if there are reasonable grounds to fear that the principal debtor the assigned funds to be exhausted without notice to the
intends to abscond; and surety and ultimately resulted in depriving the latter of
(7) if the principal debtor is in imminent danger of becoming insolvent. any possibility of recourse against that security.
o PNB v. Luzon Surety (1975), the Court hinted at the possibility
5. Extinguishment of Guaranty of the surety’s discharge from liability. It was recognized in
that case that in this jurisdiction, alteration can be a ground for
Modes of Extinguishment release. The Court clarified, though, that this principle can
Article 2076, NCC. The obligation of the guarantor is extinguished at only be successfully invoked on the condition that the
the same time as that of the debtor, and for the same causes as all alteration is material. Failure to comply with this requisite
other obligations. means that the surety cannot be freed from liability. Applying
this doctrine in that case, the Court ruled that the alterations
(1) The guaranty is extinguished, indirectly, upon the extinguishment in the form of increases in the credit line with the full consent
of the principal obligation. (2076) of the surety did not suffice to release the surety.
(2) The obligation of the guarantor is also extinguished for the same
causes as all other obligations. E. Principles Applicable Only to Contract of Guaranty Proper
(3) There are also special causes that may result in the extinguishment
of the guaranty. 1. Benefit of Excussion
Special Cause: Extension of Time Granted to Debtor Concept: The guarantor cannot be compelled to pay the creditor
Article 2079, NCC. An extension granted to the debtor by the creditor unless the latter has exhausted all the property of the debtor and
without the consent of the guarantor extinguishes the guaranty. The resorted to all the legal remedies against the debtor. This is known as
mere failure on the part of the creditor to demand payment after the the benefit of excussion. (JN Dev. Corp. v. Phil Export)
debt has become due does not of itself constitute any extension of
time referred to herein. Requisites to Avail of Benefit
Article 2060, NCC. In order that the guarantor may make use of the
(a) Rule: An extension granted to the debtor by the creditor without the benefit of excussion, he must set it up against the creditor upon the
consent of the guarantor extinguishes the guaranty. (2079) This latter’s demand for payment from him, and point out to the creditor
provision is also applicable to a surety (Autocorp Group v. Intra available property of the debtor within Philippine territory, sufficient to
Strata Assurance Corp.). cover the amount of the debt.
(1) However, the mere failure on the part of the creditor to
demand payment after the debt has become due does not of (1) it must be invoked at the proper time - the guarantor must set it
itself constitute any extension of time that will result in the up against the creditor upon the latter’s demand for payment; and
release of the guarantors. (2) it must be invoked in the proper way - the guarantor must point out
(b) Such Protection May be Waived to the creditor available property of the debtor within the
The requirement that the guarantor should consent to any extension Philippines sufficient to cover the amount of the debt.
granted by the creditor to the debtor under Art. 2079 is for the benefit
of the guarantor. Thus, even if extensions were granted by the creditor Effect of Failure to Comply With Requisites
to the principal debtor, the guarantor could opt to waive the need for If, after having been served with the demand letter at his office, the
consent to such extensions. (JN Dev. Corp v. Phil Export & Foreign guarantor fails to point out to the creditor properties of the principal
Loan Guarantee Corp.) debtor sufficient to cover its debt, such failure on the guarantor's part
forecloses his right to set up the defense of excussion. (Bitanga v.
Special Cause: When Guarantor Cannot be Subrogated Due to Pyra,id Construction Engineering)
Fault of Creditor
Article 2080, NCC. The guarantors, even though they be solidary, Effect of Compliance With Requisites
are released from their obligation whenever by some act of the Article 2061, NCC. The guarantor having fulfilled all the conditions
creditor they cannot be subrogated to the rights, mortgages, and required in the preceding article, the creditor who is negligent in
preferences of the latter. exhausting the property pointed out shall suffer the loss, to the extent
of said property, for the insolvency of the debtor resulting from such
 Rule: The guarantors, even though they be solidary, are released negligence.
from their obligation whenever by some act of the creditor
they cannot be subrogated to the rights, mortgages, and If the guarantor fulfills the foregoing conditions and the creditor, through
preference of the latter. (2180) his negligence, fails to exhaust the property pointed out, the latter shall
 Applicability: suffer the loss, to the extent of said property, for the insolvency of
o Article 2079 is no doubt applicable to a mere guarantor. the debtor resulting from such negligence.
o As to the case of a surety, the Court has ruled that in the
absence of an express stipulation, the surety is Not Condition Sine Qua Non for Filing Action Against Guarantor
discharged from liability if the act of the creditor was such  Excussion is not a condition sine qua non for the institution of an
as would be declared negligent or constitutive of a action against a guarantor (Prudential Bank v. IAC) and not a pre-
requisite to secure a judgment against the guarantor (Southern (4) if his co-guarantors have absconded or cannot be sued within the
Motors v. Barbosa). Philippines, unless they have left managers or representatives; and
 The guarantor can still demand deferment of the execution of (5) if it may be presumed that an execution on the co-guarantor’s
the judgment against him until after the assets of the principal property would not result in the satisfaction of their respective
debtor shall have been exhausted. portion of the obligation.
 It is in this sense that the guarantor cannot be held liable in the
absence of a judgment against the debtor and the latter is
unable to pay. (Baylon v. CA)
Defense Personal to Guarantor

The right is granted to the guarantor. He may choose to waive it. On the
other hand, the debtor may not raise such defense. (JN Dev.)
When Guarantor Not Entitled to Excussion

Article 2059, NCC. This excussion shall not take place:
(1) If the guarantor has expressly renounced it;
(2) If he has bound himself solidarily with the debtor;
(3) In case of insolvency of the debtor;
(4) When he has absconded, or cannot be sued within the
Philippines unless he has left a manager or representative;
(5) If it may be presumed that an execution on the property of the
principal debtor would not result in the satisfaction of the
obligation.
(1) if the guarantor has expressly renounced it;

(2) if he has bound himself solidarily with the debtor;
(3) in case of insolvency of the debtor;
(4) when debtor has absconded, or cannot be sued within the
Philippines, unless he has left a manager or representative; or
(5) if it may be presumed that an execution on the property of the
principal debtor would not result in the satisfaction of the obligation.
2. Benefit of Division
Applicability
When there are several guarantors of only one debtor and for the
same debt and they did not bind themselves solidarily.
Concept
Article 2073, NCC. When there are two or more guarantors of the
same debtor and for the same debt, the one among them who has
paid may demand of each of the others the share which is
proportionally owing from him.
If any of the guarantors should be insolvent, his share shall be borne

by the others, including the payer, in the same proportion.
The provisions of this article shall not be applicable, unless the

payment has been made in virtue of a judicial demand or unless the
principal debtor is insolvent.
 Any one of the of the co-guarantors has the right to have the
creditor divide the claim which he may have against all of
them, the creditor not being able then to demand from each
co-guarantor more than the portion that devolves on him to
satisfy by reason of the said division, provided that one of them
does not turn out to be insolvent, in which case the part
corresponding to him shall be borne by the others, in
accordance with the provision of the second paragraph of Article
2073. This is known as the “benefit of division.”
When Benefit Ceases

(1) if the guarantor has expressly renounced it;
(2) if he has bound himself solidarily;
(3) if his co-guarantors are insolvent;
REAL MORTGAGE CONTRACT AND ANTICHRESIS (4) both may secure all kinds of obligations, be they pure or subject to
suspensive or resolutory conditions. (2091, 2139)
A. Concept of REM and Antichresis
Obligations Covered
(a) Similarity  GR: Mortgage liability is usually limited to the amount
In both, the collateral consists of real property. mentioned in the contract. (Banate v. PH Countryside Rural
Bank)
(b) Distinction  EXC: The amount named as consideration in the contract of
Antichresis involves an express agreement between parties whereby: mortgage does not limit the amount for which the mortgage may
(1) the creditor will have possession of the debtor’s real property stand as security if, from the four comers of the instrument, the
given as security; intent to secure future and other indebtedness can be
(2) such creditor will then apply the fruits of the said property to the gathered. This stipulation is valid and binding between the parties
interest owed by the debtor, if any, to the principal amount; and is known as the “blanket mortgage clause” (also known as
(3) the creditor retains enjoyment of such property until the debtor has the “dragnet clause”).
totally paid what he owes; and  A mortgage given to secure future advancements is a
(4) should the obligation be duly paid, then the contract is automatically continuing security and is not discharged by repayment of the
extinguished proceeding from the accessory character of the amount named in the mortgage, until the full amount of the
agreement. advancements are paid (Bank of Commerce v. Sps. Flores).
(Reyes v. Heirs of Benjamin Malance)  Hence, where the subsequent loans were not covered by any
security other than that for the mortgage deed which contained the
 A simple mortgage does not give the mortgagee a right to the “dragnet clause,” such subsequent loans are covered by the
possession of the property unless the mortgage should contain same mortgage (Lim Julian v. Latero).
some special provision to that effect (Isagani v. De Lara).  However, if the subsequent advancements are secured by
o Hence, the creditor may be in possession of the immovable in other collaterals, only the deficiency after exhausting the security
both contracts. specified therein shall be covered by the mortgage deed which
o What really distinguishes antichresis from real estate contained the “dragnet clause. (Prudential Bank v. Alviar)
mortgage is that in the former, there must be an express
agreement granting the creditor the right to receive the fruits (e) Mortgagor Must be Absolute Owner
of the immovable but with a corresponding obligation to apply Article 2085, NCC. The following requisites are essential to the
the same to the payment of the interest, if any, and then to the contracts of pledge and mortgage: dtedru
principal. (1) That they be constituted to secure the fulfillment of a principal
o Without such express agreement, the collateral is merely a obligation;
real estate mortgage. (2) That the pledgor or mortgagor be the absolute owner of the thing
pledged or mortgaged;
(c) Assignment as Security (3) That the persons constituting the pledge or mortgage have the
 An assignment which is not an absolute conveyance which free disposal of their property, and in the absence thereof, that
confers ownership on the assignee but merely to guarantee an they be legally authorized for the purpose.
obligation is in effect a real estate mortgage, if the subject matter
is a real property (People’s Bank v. Odom), or a pledge, if the Third persons who are not parties to the principal obligation may
subject matter is a personal property. (Manila Banking v. Teodora, secure the latter by pledging or mortgaging their own property.
Jr.)
 GR: In both contracts, the debtor-mortgagor must be the
(d) Subject Matter absolute owner of the collateral (2085[2]); otherwise, the
Nature of Obligation Guaranteed in Both Contracts contract, as well as any subsequent foreclosure sale of the
Article 2086, NCC. The provisions of article 2052 are applicable to a mortgaged property (Cavite Dev. Bank v. Lim), is void (Robles v.
pledge or mortgage. CA).
 EXC: An exception to this rule is the doctrine of “mortgagee in
Article 2052, NCC. A guaranty cannot exist without a valid obligation. good faith.”
o Under this doctrine, even if the mortgagor is not the owner of
Nevertheless, a guaranty may be constituted to guarantee the the mortgaged property, the mortgage contract and any
performance of a voidable or an unenforceable contract. It may also foreclosure sale arising therefrom are given effect by reason
guarantee a natural obligation. of public policy (Llanto v. Alzona).
o This principle is based on the rule that all persons dealing
Article 2091, NCC. A promise to constitute a pledge or mortgage with property covered by a Torrens Certificate of Title, as
gives rise only to a personal action between the contracting parties, buyers or mortgagees, are not required to go beyond
without prejudice to the criminal responsibility incurred by him who what appears on the face of the title.
defrauds another, by offering in pledge or mortgage as
unencumbered, things which he knew were subject to some burden, Instances When Mortgagee Cannot Rely Simply on Title
or by misrepresenting himself to be the owner of the same. (1) Where there are circumstances which would put a party on
guard and prompt him to investigate or inspect the property
Article 2139, NCC. The last paragraph of article 2085, and articles being sold to him, such as the presence of occupants/tenants
2089 to 2091 are applicable to this contract. thereon, it is, of course, expected from the purchaser of a valued
piece of land to inquire first into the status or nature of possession
(1) It must be a valid obligation (not void); (2086 IRT 2052) of the occupants, i.e., whether or not the occupants possess the
(2) it may be voidable or unenforceable; land en concepto de dueho, in the concept of the owner. This rule
(3) it may be a civil or natural obligation;
equally applies to mortgagees of real property. (PNB v. Heirs of o Such requirement can be accomplished in the principal
Estanislao Militar) contract of loan. In such a case, the contract of antichresis
(2) The rule that persons dealing with registered lands can rely solely need not be in writing.
on the certificate of title does not apply to banks (Rural Bank of  The real estate mortgage contract is required to be in a public
Compostela v. CA) and to investment and financing institutions. document pursuant to Article 1358.
These institutions are required to ascertain the status and condition o However, even if said contract is not reduced to a public
of properties offered to them as security for loans extended by document the contract is still valid and enforceable
them. (Sunshine Finance and Investment v. IAC) because the Court has ruled that the requirement of public
(3) The GSIS cannot rely solely on the certificate of title. It must document in Article 1358 is only for convenience, not for
exercise care and prudence in investing its funds, hence it must validity nor for enforceability (Dailon v. CA)
exercise due diligence in dealing with properties submitted as  A REM contract is not covered by the Statute of Frauds
collateral for loans. (GSIS v. CA) because in relation to real properties, only the following
(4) A person engaged in real estate business cannot rely simply on transactions are covered by said Statute:
the title. He is expected to ascertain the status and condition of the (1) sale of real property;
properties offered to him as collaterals, as well as to verify the (2) lease of real property for a period longer than one year (1403
identities of the persons he transacts business with. (Adriano v. [2e])
Pangilinan) (3) express trusts over an immovable property.
Hence, an oral real estate mortgage agreement is a valid and
(f) Third Party Mortgagor enforceable contract, therefore, obligatory.
 In both contracts, third persons who are not parties to the
principal obligation may secure the latter by mortgaging their (c) Creates Real Rights
own property (2085, 2139); these third persons are known as Article 2125, NCC. In addition to the requisites stated in article 2085,
accommodation mortgagors. it is indispensable, in order that a mortgage may be validly
 An accommodation mortgagor is not solidarily bound with the constituted, that the document in which it appears be recorded in the
principal debtor. (Bank of America v. American Realty Corp.) Registry of Property. If the instrument is not recorded, the mortgage
o His liability extends only to the property mortgaged. is nevertheless binding between the parties.
o Should there be any deficiency, the creditor has recourse on
the principal debtor. (Cerna v. CA) The persons in whose favor the law establishes a mortgage have no
other right than to demand the execution and the recording of the
B. Characteristics of Both Contracts document in which the mortgage is formalized.
(a) Perfection Article 2126, NCC. The mortgage directly and immediately subjects
 Both contracts are consensual or perfected upon mere consent. the property upon which it is imposed, whoever the possessor may
 In antichresis, the delivery of the immovable is not a requirement be, to the fulfillment of the obligation for whose security it was
for its perfection. constituted.
o Instead, upon the perfection of the said contract by mere
consent, it will create an obligation on the part of the debtor  In order to bind third persons, both contracts must be recorded in
to deliver the immovable to the creditor. the Registry of Property (2125).
 However, both contracts are nevertheless binding between the
(b) Formalities Required parties even if they are not recorded in the Registry of Property. But
Article 2134, NCC. The amount of the principal and of the interest once the contracts are recorded, the same are real rights following
shall be specified in writing; otherwise, the contract of antichresis the property, such that in subsequent transfers by the mortgagor,
shall be void. the transferee must respect the mortgage. (2126)
Article 1358, NCC. The following must appear in a public document: (d) Indivisibility of Mortgage and Antichresis
(1) Acts and contracts which have for their object the creation, Article 2089, NCC. A pledge or mortgage is indivisible, even though
transmission, modification or extinguishment of real rights over the debt may be divided among the successors in interest of the
immovable property; sales of real property or of an interest debtor or of the creditor.
therein are governed by articles 1403, No. 2, and 1405;
(2) The cession, repudiation or renunciation of hereditary rights or Therefore, the debtor’s heir who has paid a part of the debt cannot
of those of the conjugal partnership of gains; ask for the proportionate extinguishment of the pledge or mortgage
(3) The power to administer property, or any other power which has as long as the debt is not completely satisfied.
for its object an act appearing or which should appear in a public
document, or should prejudice a third person; Neither can the creditor’s heir who received his share of the debt
(4) The cession of actions or rights proceeding from an act return the pledge or cancel the mortgage, to the prejudice of the other
appearing in a public document. heirs who have not been paid.
All other contracts where the amount involved exceeds five hundred
pesos must appear in writing, even a private one. But sales of goods, From these provisions is excepted the case in which, there being
chattels or things in action are governed by articles 1403, No. 2 and several things given in mortgage or pledge, each one of them
1405. guarantees only a determinate portion of the credit.
 In order for the contract of antichresis to be valid, the law requires The debtor, in this case, shall have a right to the extinguishment of
that the amount of the principal and interest of the loan the pledge or mortgage as the portion of the debt for which each thing
contract must be specified in writing. is specially answerable is satisfied.
Article 2090, NCC. The indivisibility of a pledge or mortgage is not  Such stipulation for automatic vesting of title over the security in the
affected by the fact that the debtors are not solidarily liable. creditor in case of the debtor’s default is known as pactum
commissorium. (Vda. De Zuluata v. Octaviano)
 Both contracts are indivisible, even though the debt may be divided
among the successors in interest of the debtor or of the creditor. Elements of Pactum Commissorium
(2089) (1) there should be a property mortgaged by way of security for the
 Such indivisibility is not affected by the fact that the debtors are payment of the principal obligation; and
not solidarity liable (2090). (2) that there should be stipulation for an automatic appropriation
 The Court has understood mortgage indivisibility in the sense that by the creditor of the thing mortgaged in case of non-payment
each and every parcel under mortgage answers for the totality of the principal obligation within the stipulated period (DBP v. CA).
of the debt (PNB v. Mallorca), regardless of the existence or non- The essence of pactum commissorium, which is prohibited by Article
existence of several heirs of the debtor or creditor. 2088, is that ownership of the security will pass to the creditor by
the mere default of the debtor. (Briones-Vasquez v. CA)
As consequences of this principle of indivisibility Instances of Pactum Commissorium
(1) the mortgage cannot be divided among the different lots which (1) If the transaction is made to appear as a sale with right to
are mortgaged to secure it (PNB v. IAC); instead, each and repurchase but the property merely stands as a security for the
every parcel of land under mortgage answers for the totality of payment of the principal obligation and the period for
the debt (Gonzales v. GSIS) repurchase is actually the period for the payment of the loan
(2) A debtor cannot ask for the release of any portion of the obligation, in which case an equitable mortgage exists, the
mortgaged property or of one or some of the several consolidation of ownership in the person of the mortgagee in equity,
properties mortgaged unless and until the loan thus secured has merely upon failure of the mortgagor in equity to pay the obligation,
been fully paid, notwithstanding the fact that there has been partial would amount to a pactum comrnissoriurn. (Montevergin v. CA)
fulfillment of the obligation. (MBTC v. SLGT Holdings, Inc.) (2) If the transaction is made to appear as a dacion en pago but
the debt subsisted despite the transfer of the property in the
Qualifications: name of the creditor, such circumstance rendered the transaction
 Once the mortgage is extinguished by a complete foreclosure as a pactum commissorium. (Pen v. Julian)
thereof, said doctrine of indivisibility ceases to apply since, with
the full payment of the debt, there is nothing more to secure. (PNB For a valid dacion enpago to transpire, the attendance of the following
v. Delos Reyes) elements must be established, namely:
 The concept of indivisibility of mortgage does not apply to the  the existence of a money obligation;
right of redemption of an accommodation mortgagor and his  the alienation to the creditor of a property by the debtor with the
assignees (Belo v. PNB). The liability of the accommodation consent of the former; and
mortgagors extends only up to the loan value of their mortgaged  the satisfaction of the money obligation of the debtor. To have a
property and not to the entire loan itself. valid dacion en pago, therefore, the alienation of the property must
fully extinguish the debt.
(3) Since every portion of the property mortgaged is answerable
for the whole obligation as soon as the latter falls due, the (3) If the transaction is made to appear as an assignment of property
mortgagor cannot opt much less compel the mortgagee, to but the property merely stands as a security for the payment of an
apply any payment made by him on a specific portion of the existing obligation and not an absolute conveyance of title which
mortgaged property to effect release. (PNB v. Amores) confers ownership on the assignee, the transaction is in effect a
(4) The annulment of the mortgage is an all or nothing mortgage. (People’s Bank v. Odom) Hence, the transfer of the title
proposition. It cannot be divided into valid or invalid parts. The to the creditor is a case of pactum commissorium.
mortgage is either valid in its entirety or not valid at all. Ergo, a
declaration of nullity for violation of Section 18 of PD 957 should (f) Prohibition against Stipulation Forbidding Mortgagor from
result to the mortgage being nullified wholly (MBTC). Alienating
Article 2130, NCC. A stipulation forbidding the owner from alienating
(e) Prohibition Against Pactum Commissorium the immovable mortgaged shall be void.
RULE
Article 2088, NCC. The creditor cannot appropriate the things given  The law prohibits any stipulation forbidding the owner from
by way of pledge or mortgage, or dispose of them. Any stipulation to alienating the immovable mortgaged, declaring any such
the contrary is null and void. stipulation to be void (2130).
 The prohibition is still violated even if the Deed of Real Estate
Article 2137, NCC. The creditor does not acquire the ownership of Mortgage contains no absolute prohibition against the sale of the
the real estate for non-payment of the debt within the period agreed property mortgaged but only requires the mortgagor to obtain
upon. the prior written consent of the mortgagee before any such
sale. (Litonjua v. L & R Corp.)
Every stipulation to the contrary shall be void. But the creditor may o Such stipulation practically gives the mortgagee the sole
petition the court for the payment of the debt or the sale of the real prerogative to prevent any sale of the mortgaged property
property. In this case, the Rules of Court on the foreclosure of to a third party. The mortgagee can simply withhold its
mortgages shall apply. consent and, thereby, prevent the mortgagor from selling the
property. This creates an unconscionable advantage for the
 The creditor cannot appropriate the things given by way of mortgagee and amounts to a virtual prohibition on the owner
mortgage (2088) or antichresis (2137). to sell his mortgaged property.
 Any stipulation to the contrary is void. o However, a stipulation prohibiting the mortgagor from entering
into second or subsequent mortgages was held to be valid.
(PH Industrial Co. v. El Hogar Filipino and Vallejo)
registration of the certificate of foreclosure sale” and in no

C. Remedies in Case of Default case more than three months after foreclosure, whichever
comes first.
(a) Alternative Remedies o The three-month period is counted from the date when the
In real estate mortgage, the mortgagee may either: certificate of sale is issued (CIR v. UCPB).
(1) foreclose the mortgage; or o The shorter period for the exercise of the right of redemption
(2) file an ordinary action to collect the debt. (Caltex v. IAC) on the part of a juridical person is applicable even if the
mortgage was executed prior to the effectivity of RA 8791 so
 The same rule applies in antichresis (2137[2]). long as the foreclosure is made during the law’s
 These remedies available to the mortgagee-creditor are deemed effectivity.
alternative and not cumulative. o The constitutional proscription against impairment of the
o An election of one remedy operates as a waiver of the other obligation of contract is not violated because Section 47 of the
(Suico Rattan v. CA). Hence, the mere act of filing a collection GBL does not divest juridical persons of the right to redeem
suit for the recovery of a debt secured by a mortgage their foreclosed properties but only modified the time for the
constitutes waiver of the other remedy of foreclosure. The exercise of such right by reducing the one-year period
mortgagee thereby waives his mortgage lien and he will originally provided in Act No. 3135 (Goldenway Merchandsing
have no more priority over the mortgaged property. v. Equitable PCI Bank)
(Caltex)  The difference in the treatment of juridical persons and natural
persons is based on the nature of the properties foreclosed,
(b) Foreclosure of Mortgage whether these are used as residence, for which the more liberal
Manner of Foreclosure one-year redemption period is retained, or used for industrial or
The foreclosure of the mortgage may either be judicial or extrajudicial. commercial purposes, in which case a shorter term is deemed
 The extrajudicial sale of the property mortgaged is allowed only necessary to reduce the period of uncertainty in the ownership of
when the mortgagee is given a special power or express authority property and enable mortgagee-banks to dispose sooner of these
to do so in the deed itself, or in a document annexed thereto. (Luna acquired assets.847
v. Encarnacion)
 In antichresis, the foreclosure should always be judicial (2137) If Mortgagee is Not a Bank
 If the foreclosure is made extrajudicially, the governing law is Act
Prescriptive Period of Mortgage Action No. 3135 which grants a right of redemption within a period of
A mortgage action prescribes after 10 years from the time the right of one year, whether the mortgagor is a natural person or a
action accrues (1142), which is obviously not the same as the date of juridical person.
the mortgage contract. The right of action accrues when the o The one-year period of redemption is counted from the date
mortgagor defaults in the payment of his obligation to the of the registration of the certificate of sale.
mortgagee. (Cando v. Olazo)  However, if the foreclosure is made judicially, there is no right of
redemption but only equity of redemption (Limpin v. IAC),
Recovery of deficiency except if the mortgagee is a banking institution (Sec 47 GBL).
 Whether the foreclosure is judicial or extrajudicial, there is a o Equity of redemption is simply the right of the defendant
right to recover the deficiency (PH Bank of Commerce v. De Vera). mortgagor to extinguish the mortgage and retain ownership of
 If the foreclosure was done extrajudicially, the deficiency may the property by paying the secured debt (Limpin) within a
be recovered by filing an ordinary action for collection within period of not less than 90 days nor more than 120 days
the same 10-year period because a suit for the recovery of the from the entry of judgment (S2 R68), or even after the
deficiency after the foreclosure of a mortgage is in the nature of a foreclosure sale but prior to its confirmation.
mortgage action (DBP v. Tomeldan). o After such order of confirmation, no redemption can be
 The mortgagee has the right to recover deficiency in case of effected any longer (Limpin).
judicial foreclosure by way of a mere motion. (Sec. 6 R68)
D. Antichresis
Right of Redemption
If Mortgagee is a Bank (a) Essence
If the mortgagee-creditor is a banking institution, the applicable law is  In order that there be antichresis, there must be an express
Sec. 47 of the General Banking Law (RA 8791), even if the bank had agreement in the contract that the creditor shall have the right
already assigned the mortgage to a nonbank because in assignment to receive the fruits of the immovable with the obligation of
the assignee steps into the shoes of the assignor (White Marketing v. applying it to the interest, if owing, or the excess to the principal.
Grandwood Furniture). Without that agreement, there is no antichresis (Adrid v. Morga).
 Under Section 47 of the GBL, there is a right of redemption  Thus, if a contract of loan with security provides for the delivery to
whether the foreclosure is judicial or extrajudicial. the creditor by the debtor of the property given as security, in order
 If the mortgagor is a natural person, the redemption period is that the latter may gather its fruits but without stating that said fruits
one year. are to be applied to the payment of interest, if any, and afterwards
o In CIR v. United Coconut Planters Bank, the Court ruled that that of the principal, the contract is a mortgage and not antichresis.
“for purposes of reckoning the one-year redemption period in
the case of individual mortgagors, or the three-month (b) Creditor Entitled to Possession
redemption period for juridical persons/mortgagors, the same Article 2136, NCC. The debtor cannot reacquire the enjoyment of
shall be reckoned from the date of the confirmation of the the immovable without first having totally paid what he owes the
auction sale which is the date when the certificate of sale creditor.
is issued.”
 If the mortgagor is a juridical person the latter is allowed to But the latter, in order to exempt himself from the obligations imposed
exercise the right of redemption only “until, but not after, the upon him by the preceding article, may always compel the debtor to
enter again upon the enjoyment of the property, except when there
is a stipulation to the contrary.
 In antichresis, the delivery of the immovable to the creditor is not a

requirement for the perfection of the contract but an obligation of
the debtor upon the perfection of the contract.
 The debtor cannot, thereafter, reacquire the enjoyment of the
immovable without first having totally paid what he owes the
creditor. (2136)
(c) Obligations of Creditor

Article 2132, NCC. By the contract of antichresis the creditor
acquires the right to receive the fruits of an immovable of his debtor,
with the obligation to apply them to the payment of the interest, if
owing, and thereafter to the principal of his credit.
Article 2133, NCC. The actual market value of the fruits at the time
of the application thereof to the interest and principal shall be the
measure of such application.
Article 2135, NCC. The creditor, unless there is a stipulation to the

contrary, is obliged to pay the taxes and charges upon the estate.
He is also bound to bear the expenses necessary for its preservation

and repair.
The sums spent for the purposes stated in this article shall be
deducted from the fruits.
Article 2136, NCC. The debtor cannot reacquire the enjoyment of

the immovable without first having totally paid what he owes the
creditor.
But the latter, in order to exempt himself from the obligations imposed
upon him by the preceding article, may always compel the debtor to
enter again upon the enjoyment of the property, except when there
is a stipulation to the contrary.
(1) To apply the fruits to the payment of the interest, if owing, and
thereafter to the principal of his credit (2132). The measure of such
application shall be the actual market value of the fruits at the
time of the application thereof to the interest and principal.
(2133)
(2) Unless there is a stipulation to the contrary, he is obliged to pay the
taxes and charges upon the estate (2135).
(a) He is also bound to bear the expenses necessary for its
preservation and repair.
(b) The sums spent for these purposes shall, however, be
deducted from the fruits.
(c) If the creditor wants to exempt himself from the obligations
mentioned in number 2 hereof, he may compel the debtor to
enter again upon the enjoyment of the property, except when
there is a stipulation to the contrary (2136)
PERSONAL PROPERTY AS SECURITY security interest in that property is created only when the
grantor acquires rights in it or the power to encumber it. (5[b])
A. Effect of Personal Property Security Act (RA 11507)
(c) Manner of Creating Security Interest
(a) Repeal of Provisions on Pledge and Chattel Mortgage  A security interest shall be created by a security agreement (5a),
This Act, briefly referred to as PPSA, repealed the provisions of the CC which must be contained in a written contract signed by the
on Pledge (Articles 2085 up to 2123), the provisions of the CC on parties.
Chattel Mortgage (Articles 2140 and 2141) and Sections 1 to 16 of  It may consist of one or more writings that, taken together,
the Chattel Mortgage Law (Act No. 1508). establish the intent of the parties to create a security interest
(6).
(b) No More Pledge and Chattel Mortgage  Such security interest shall continue in collateral
Under the PPSA, contracts creating a security interest over a movable notwithstanding sale, lease, license, exchange, or other
property are referred to simply as “security agreement.” (S6) Hence, the disposition of the collateral (9), except:
distinction existing between the contracts of pledge and chattel o as agreed upon by the parties (9); or
mortgage under the Civil Code is no longer applicable. o the third person obtains any movable containing a security
interest in the ordinary course of business and in good faith.
(c) Creation of Centralized Registry (21)
The PPSA created a centralized and nationwide electronic registry  However, he cannot claim good faith if the security
that will be lodged in the Land Registration Authority (LRA) where notice interest in the movable property was registered prior
of a security interest and a lien in personal property may be registered. to his obtaining the property.
(S. 26-44)
(d) Perfection of Security Interest
(d) Scope of PPSA Importance of Perfection: Upon perfection, a security interest
The law covers all transactions of any form that secure an obligation with becomes effective against third parties.(11b)
movable collateral.865 Exceptions: The law does not apply to: (1)
aircraft of Philippine registry or any interest therein as collateral; and (2) Manner of Perfection: A security interest shall be perfected when a
vessels of domestic ownership as collateral.866 The PPSA did not security agreement is executed and any of the following acts is done:
repeal the pertinent provisions of the Civil Aviation Authority Act of 2008 (1) registration of the security interest in the electronic registry of the
(R.A. No. 9497) and the Ship Mortgage Decree of 1978 (P.D. No. 1521). Land Registration Authority;
Hence, a security agreement involving an aircraft of Philippine registry (2) possession of the collateral by the secured creditor; or
must still be registered with the Philippine Civil Aviation Authority,867 (3) control of investment property and deposit account. (11a)
while the security agreement covering a vessel must still be registered
with the office of the Philippine Coast Guard of the port of documentation In turn, a security interest in a deposit account or investment
of such vessel.“8 property may be perfected by control through:
(1) the creation of the security interest in favor of the deposit-taking
B. Creation of Security Interest institution or the intermediary;
(2) the conclusion of a control agreement; or
(a) Concept of Security Interest (3) for an investment property that is an electronic security not held
It is a property right in collateral that secures payment or other with an intermediary, the notation of the security interest in the
performance of an obligation, regardless of whether the parties have books maintained by or on behalf of the issuer for the purpose of
denominated it as a security interest, and regardless of the type of asset, recording the name of the holder of the securities. (13)
the status of the grantor or secured creditor, or the nature of the secured
obligation; including the right of a buyer of accounts receivable and a (e) Priority Rules
lessor under an operating lease for not less than one year. (S3[j]) The priority of security interests and liens in the same collateral shall be
determined according to time of registration of a notice or perfection by
(b) Forms of Collateral Where Security Interest Can be Created other means, without regard to the order of creation of the security
 A security interest may be created over all forms of tangible or interests and liens (17), subject to the following rules:
intangible assets or personal property as defined by the CC, (1) a security interest in a deposit account with respect to which the
including but not limited to: secured creditor is the deposittaking institution or the intermediary
o rights arising from contracts (such as securities, commodities shall have priority over a competing security interest perfected by
contracts, and lease of goods including financial leases and any method (18);
operating leases for a period of not less than one year), (2) a security interest in a deposit account or investment property that
equipment, inventory, deposit accounts, negotiable is perfected by a control agreement shall have priority over a
instruments, negotiable documents of title, consumer goods, competing security interest except a security interest of the deposit-
intellectual property, livestock, fixtures, accessions and taking institution or the intermediary;
commingled goods, and future property or after-acquired (3) a security interest in a security certificate perfected by the secured
assets, provided that a security interest can only be creditor’s possession of the certificate shall have priority over a
created on the asset over which the grantor has a legal competing security interest perfected by registration of a notice in
right (S2.03, IRR). the Registry;
 Under previous law, a future property cannot be pledged or (4) a security interest in electronic securities not held with an
mortgaged because the requirement used to be that the intermediary perfected by a notation of the security interests in the
pledgor or mortgagor must be the absolute owner over the books maintained for that purpose by or on behalf of the issuer shall
thing pledged or mortgaged. have priority over a security interest in the same securities
o Under the PPSA, a security agreement may provide for the perfected by any other method;885
creation of a security interest in a future property, but the (5) a security interest in electronic securities not held with an
intermediary perfected by the conclusion of a control agreement
shall have priority over a security interest in the same securities (c) any other person from whom the secured creditor received
perfected by registration of a notice in the Registry; (19) notification of a claim of an interest in the collateral if the
(6) a security interest in an instrument or negotiable document that is notification was received before the secured creditor gave
perfected by possession of the instrument or the negotiable notification of the proposed disposition to the grantor (51a);
document shall have priority over a security interest in the (2) he may retain the collateral in full satisfaction of the secured
instrument or negotiable document that is perfected by registration obligation if any of the following persons did not issue an objection
of a notice in the Registry; in writing within 20 days after the proposal for such retention is sent
(7) a person who provides services or materials with respect to the to:
goods, in the ordinary course of business, and retains possession (a) the grantor;
of the goods shall have priority over a perfected security interest in (b) any other secured creditor or lien holder who, five days before
the goods until payment thereof; (20) the proposal is sent to the debtor and the grantor, perfected
(8) a purchase money security interest in equipment and its proceeds its security interest or lien by registration; and
shall have priority over a conflicting security interest, if a notice (c) any other person with an interest in the collateral who has
relating to the purchase money security interest is registered within given a written notification to the secured creditor before the
three business days after the grantor receives possession of the proposal is sent to the debtor and the grantor (54); or
equipment; (23a) (3) he may retain the collateral or part thereof in partial satisfaction of
(9) a purchase money security interest in consumer goods that is the secured obligation only if he receives the affirmative consent of
perfected by registration of notice not later than three business each addressee of the proposal in writing within 20 days after the
days after the grantor obtains possession of the consumer goods proposal is sent to that person.
shall have priority over a conflicting security interest; [Note: The
purchase money security interest in equipment or consumer goods (b) Right of Secured Creditor to Buy Collateral
perfected timely in accordance with (viii) and (ix) hereof, shall have (1) he has the right to buy the collateral at any public disposition;
priority over the rights of a buyer, lessee, or lien holder which arise (2) if the sale is done privately, he is allowed to buy only if the collateral
between delivery of the equipment or consumer goods to the is of a kind that is customarily sold on a recognized market or the
grantor and the time the notice is registered. subject of widely distributed standard price quotations. (49b)
(10) a purchase money security interest in inventory, intellectual
property, or livestock shall have priority over a conflicting perfected (c) Right to Recover Deficiency
security interest in the same inventory, intellectual property or The secured creditor has the right to recover the deficiency. In case of
livestock if: surplus, the grantor is entitled to the same. (52b)
(a) the purchase money security interest is perfected when the
grantor receives possession of the inventory or livestock, or (d) Right of Redemption
acquires rights to intellectual property; and Under the PPSA, there is now a right of redemption in relation to
(b) before the grantor receives possession of the inventory or personal property as security.
livestock, or acquires rights in intellectual property, the (1) Who May Redeem: Any of the following:
purchase money secured creditor gives written notification to (a) the grantor;
the holder of the conflicting perfected security interest in the (b) any other secured creditor or lien holder who, five days before
same types of inventory, livestock, or intellectual property. the date notification is sent to the grantor, held a security
(i) The notification sent to the holder of the conflicting interest or lien in the collateral that was perfected by
security interest may cover multiple transactions registration; or
between the purchase money secured creditor and the (c) any other person from whom the secured creditor received
grantor without the need to identify each transaction; notification of a claim of an interest in the collateral if the
(11) a perfected security interest in livestock securing an obligation notification was received before the secured creditor gave
incurred to enable the grantor to obtain food or medicine for the notification of the proposed disposition to the grantor (45a)
livestock shall have priority over any other security interest in the (2) When Right May be Exercised: The right of redemption may be
livestock, except for a perfected purchase money security interest exercised, unless:
in the livestock, if the secured creditor providing credit for food or (a) the person entitled to redeem has, after the default, waived in
medicine gives written notification to the holder of the conflicting writing the right to redeem;
perfected security interest in the same livestock before the grantor (b) the collateral is sold or otherwise disposed of, acquired or
receives possession of the food or medicine (24); and collected by the secured creditor, or until the conclusion of an
(12) a perfected security interest in a movable property which has agreement by the secured creditor for that purpose; or
become a fixture, or has undergone accession or commingling, (c) the secured creditor has retained the collateral. (49b)
shall continue provided the movable property involved can still be
reasonably traced. In determining ownership over fixtures,
accessions, and commingled goods, the provisions of Book II of RA
386 or the “Civil Code of the Philippines” shall apply. (25)
C. Enforcement of Security Interest
(a) Remedies of Secured Creditor:

(1) He may sell or otherwise dispose of the collateral, publicly or
privately (49a), subject to a 10-day prior notice to the following:
(a) the grantor;
(b) any other secured creditor or lien holder who, five days before
the date notification is sent to the grantor, held a security
interest or lien in the collateral that was perfected by
registration; and
PREFERENCE AND CONCURRENCE OF CREDIT (13) Claims in favor of the depositor if the depositary has wrongfully
sold the thing deposited, upon the price of the sale.
A. In General In the foregoing cases, if the movables to which the lien or preference
attaches have been wrongfully taken, the creditor may demand them
(a) Concept of Concurrence of Credits from any possessor, within thirty days from the unlawful seizure.
The concept applies when:
(1) the same specific property of the debtor or all of his property Article 2242, NCC. With reference to specific immovable property
is subjected to the claims of several creditors; and and real rights of the debtor, the following claims, mortgages and
(2) said assets are insufficient to pay all of them. (PSBank v. Lantin) liens shall be preferred, and shall constitute an encumbrance on the
immovable or real right:
(b) Concept of Preference of Credit (1) Taxes due upon the land or building;
A preference of credit bestows upon the preferred creditor an (2) For the unpaid price of real property sold, upon the immovable
advantage of having his credit satisfied first ahead of other claims sold;
which may be established against the debtor (DBP v. Secretary of Labor) (3) Claims of laborers, masons, mechanics and other workmen, as
well as of architects, engineers and contractors, engaged in the
(c) Requirement of Liquidation Proceedings construction, reconstruction or repair of buildings, canals or
The provisions on concurrence and preference of credits shall only be other works, upon said buildings, canals or other works;
applicable if there is bankruptcy, insolvency, or general liquidation (4) Claims of furnishers of materials used in the construction,
proceedings. reconstruction, or repair of buildings, canals or other works,
upon said buildings, canals or other works;
B. Classification of Credits (5) Mortgage credits recorded in the Registry of Property, upon the
real estate mortgaged;
(a) Special Preferred Credits (6) Expenses for the preservation or improvement of real property
Article 2241, NCC. With reference to specific movable property of when the law authorizes reimbursement, upon the immovable
the debtor, the following claims or liens shall be preferred: preserved or improved;
(1) Duties, taxes and fees due thereon to the State or any (7) Credits annotated in the Registry of Property, in virtue of a
subdivision thereof; judicial order, by attachments or executions, upon the property
(2) Claims arising from misappropriation, breach of trust, or affected, and only as to later credits;
malfeasance by public officials committed in the performance of (8) Claims of co-heirs for warranty in the partition of an immovable
their duties, on the movables, money or securities obtained by among them, upon the real property thus divided;
them; (9) Claims of donors or real property for pecuniary charges or other
(3) Claims for the unpaid price of movables sold, on said movables, conditions imposed upon the donee, upon the immovable
so long as they are in the possession of the debtor, up to the donated;
value of the same; and if the movable has been resold by the (10) Credits of insurers, upon the property insured, for the insurance
debtor and the price is still unpaid, the lien may be enforced on premium for two years.
the price; this right is not lost by the immobilization of the thing
by destination, provided it has not lost its form, substance and  These credits constitute liens or encumbrances on the specific
identity; neither is the right lost by the sale of the thing together movable or immovable property to which they relate. (Republic v.
with other property for a lump sum, when the price thereof can Peralta)
be determined proportionally;  They enjoy preference over that of ordinary preferred credits and
(4) Credits guaranteed with a pledge so long as the things pledged common credits.
are in the hands of the creditor, or those guaranteed by a chattel  These are the credits enumerated in Articles 2241 (specific
mortgage, upon the things pledged or mortgaged, up to the movable) and 2242 (specific immovable and real rights).
value thereof;  Among the special preferred credits listed in Articles 2241 and
(5) Credits for the making, repair, safekeeping or preservation of 2242, only taxes, duties, and fees on specific movables or
personal property, on the movable thus made, repaired, kept or immovables (Article 2241 [1] and Article 2242[2]) enjoy
possessed; preference while all other special preferred credits (non-tax liens)
(6) Claims for laborers’ wages, on the goods manufactured or the stand on the same footing, and to be satisfied pari passu and pro
work done; rata.
(7) For expenses of salvage, upon the goods salvaged;
 Note that a security interest (in a personal or movable property)
(8) Credits between the landlord and the tenant, arising from the
perfected pursuant to the PPSA prior to the commencement of
contract of tenancy on shares, on the share of each in the fruits
insolvency proceedings in respect of the grantor shall remain
or harvest;
perfected and retain the priority it had before the commencement
(9) Credits for transportation, upon the goods carried, for the price
of the insolvency proceedings (22).
of the contract and incidental expenses, until their delivery and
 In other words, it shall retain its classification as a special preferred
for thirty days thereafter;
credit.
(10) Credits for lodging and supplies usually furnished to travellers
by hotel keepers, on the movables belonging to the guest as
(b) Ordinary Preferred Credits
long as such movables are in the hotel, but not for money loaned
Article 2244, NCC. With reference to other property, real and
to the guests;
personal, of the debtor, the following claims or credits shall be
(11) Credits for seeds and expenses for cultivation and harvest
preferred in the order named:
advanced to the debtor, upon the fruits harvested;
(1) Proper funeral expenses for the debtor, or children under his or
(12) Credits for rent for one year, upon the personal property of the
her parental authority who have no property of their own, when
lessee existing on the immovable leased and on the fruits of the
approved by the court;
same, but not on money or instruments of credit;
(2) Credits for services rendered the insolvent by employees,  These are the credits which are not included in Articles 2241, 2242,
laborers, or household helpers for one year preceding the and 2244. They are to be paid only after paying all special
commencement of the proceedings in insolvency; preferred and ordinary preferred credits.
(3) Expenses during the last illness of the debtor or of his or her  Among the common credits, there shall be no preference and
spouse and children under his or her parental authority, if they they are to be paid pro rata regardless of dates. (2251[1])
have no property of their own;
(4) Compensation due the laborers or their dependents under laws
providing for indemnity for damages in cases of labor accident,
or illness resulting from the nature of the employment;
(5) Credits and advancements made to the debtor for support of
himself or herself, and family, during the last year preceding the
insolvency;
(6) Support during the insolvency proceedings, and for three
months thereafter;
(7) Fines and civil indemnification arising from a criminal offense;
(8) Legal expenses, and expenses incurred in the administration of
the insolvent’s estate for the common interest of the creditors,
when properly authorized and approved by the court;
(9) Taxes and assessments due the national government, other
than those mentioned in articles 2241, No. 1, and 2242, No. 1;
(10) Taxes and assessments due any province, other than those
referred to in articles 2241, No. 1, and 2242, No. 1;
(11) Taxes and assessments due any city or municipality, other than
those indicated in articles 2241, No. 1, and 2242, No. 1;
(12) Damages for death or personal injuries caused by a quasi-
delict;
(13) Gifts due to public and private institutions of charity or
beneficence;
(14) Credits which, without special privilege, appear in (a) a public
instrument; or (b) in a final judgment, if they have been the
subject of litigation. These credits shall have preference among
themselves in the order of priority of the dates of the instruments
and of the judgments, respectively.
 These are the credits which are not attached to a specific

movable or immovable property but they enjoy preference
over that of common credits.
 These are the credits enumerated in Article 2244.
 Insofar as ordinary preferred credits are concerned, they are to be
paid in the order mentioned in Article 2244, except that the
worker’s claim for unpaid wages (in Article 2244, No. 2) has
been moved from second priority to first priority in the order of
preference and the one-year limitation in Article 2242, No. 2 has
already been removed (Republic v. Peralta).
o The preference given by Article 110 of the Labor Code, when
not falling within Article 2241(6) and Article 2242(3), and not
attached to any specific property, is an ordinary preferred
credit, although its impact is to move it from second priority to
first priority in the order of preference established by Article
2244.
(c) Common Credits

Article 2245, NCC. Credits of any other kind or class, or by any other
right or title not comprised in the four preceding articles, shall enjoy
no preference.
Article 2251, NCC. Those credits which do not enjoy any preference
with respect to specific property, and those which enjoy preference,
as to the amount not paid, shall be satisfied according to the following
rules:
(1) In the order established in article 2244;
(2) Common credits referred to in article 2245 shall be paid pro rata
regardless of dates.
BOOK VI – TORTS & DAMAGES omission to do acts which result in damage to another (Child
Learning Center v. Tagorio)
PART 1: QUASI-DELICT
Covers Acts or Omissions Criminal in Character
A. Concept of Quasi-delict (1) Different from Delict
 Quasi-delict is a separate legal institution under the CC with a
1. Scope of Quasi-Delict substantivity all its own, and individuality that is entirely apart and
independent from delict or crime (Barredo v. CA).
Article 2176, NCC. Whoever by act or omission causes damage to  The other differences pointed out between crimes and quasi-delicts
another, there being fault or negligence, is obliged to pay for the are:
damage done. Such fault or negligence, if there is no pre-existing
contractual relation between the parties, is called a quasi-delict and Crimes Quasi-delicts
is governed by the provisions of this Chapter. affect the public interest only of private concern
consequently, the RPC punishes the CC, by means of
Article 1146, NCC. The following actions must be instituted within or corrects the criminal act indemnification, merely repairs
four years: the damage
(1) Upon an injury to the rights of the plaintiff; delicts are not as broad as quasi- the cuasi-delitos include all acts
(2) Upon a quasi-delict; delicts, because the former are in which any kind of fault or
However, when the action arises from or out of any act, activity, or punished only if there is a penal negligence intervenes
conduct of any public officer involving the exercise of powers or law clearly covering them
authority arising from Martial Law including the arrest, detention
and/or trial of the plaintiff, the same must be brought within one (1) (2) But Covers Acts Criminal in Character
year. Article 2177, NCC. Responsibility for fault or negligence under the
preceding article is entirely separate and distinct from the civil liability
Requisites of Quasi-Delict arising from negligence under the Penal Code. But the plaintiff cannot
In every tort case filed under Article 2176, the plaintiff has to prove by a recover damages twice for the same act or omission of the
preponderance of evidence: defendant.
(1) the damages suffered by the plaintiff;
(2) the fault or negligence of the defendant or some other person for  As far back as the cases of Barredo v. Garcia and Elcano v. Hill,
whose act he must respond; and the Court categorically ruled that Article 2176, where it refers to
(3) the connection of cause and effect between the fault or negligence “fault or negligence,” covers not only acts “not punishable by
and the damages incurred. law” but also acts criminal in character, whether intentional and
(Corinthian Gardens Association v. Tanjangco) voluntary or negligent.
The prescriptive period of an action based on quasi-delict is four years  Thus, in every commission of a crime so long as there is a
from accrual of the right of action. (1146) private offended party who suffered injuries, the same act or
omission causing damages may produce two distinct sources
Damnum Absque Injuria: valid exercise of a right. The act is NOT of obligations.
unlawful.
 An early established rule under our law is that an act or omission,
extracontractual in nature, causing damage to another, there being
Not Limited to Negligence
fault or negligence, can create two separate civil liabilities on
 While there is a holding that Article 2176, which defines quasi- the part of the offender, i.e., civil liability ex delicto and civil liability
delict, is limited to negligent acts or omissions and excludes ex quasi delicto.
the notion of willfulness or intent and equating the same to what o Either one of these two possible liabilities may be sought to
is known in Spanish legal treatises as culpa aquiliana (Gashem be enforced against the offender subject, however, to the
Shookat Bash v. CA), the correct view is that the scope of caveat under Article 2177 that the offended party cannot
Article 2176 is not limited to acts or omissions resulting from “recover damages twice for the same act or omission” or
negligence (Safeguard Security Agency v. Tangco). under both causes (Vitug, concurring in Rafael Reyes
o Article 2176 covers not only acts committed with negligence, Trucking v. People).
but also acts which are voluntary and intentional (Dulay v.
 Outside of this proscription, the two civil liabilities are distinct and
CA).
independent of each other; thus, and conversely against the rule
o As far back as the definitive case of Elcano v. Hill,' the Court
on double recovery, the failure of recovery in one will not
already held that Article 2176, where it refers to “fault or
necessarily preclude recovery in the other.
negligence,” covers not only acts “not punishable by law”
but also acts criminal in character, whether intentional
As consequences of the foregoing principles:
and voluntary or negligent.
 The acquittal of the accused, even if based on a finding that he
 In Article 2176, the term “fault” does not carry the same meaning
is not guilty, does not carry with it the extinction of the civil
as “negligence.”
liability based on quasi-delict (Manliclic v. Calaunan).
o Fault, in general, signifies a voluntary act or omission which
o As regards civil liability arising from quasi-delict or culpa
causes damage to the right of another giving rise to an
aquiliana, the same will not be extinguished by an
obligation on the part of the actor to repair such damage.
acquittal, whether it be on ground of reasonable doubt or
o Negligence is the failure to observe for the protection of the
that the accused was not the author of the act or omission
interest of another person that degree of care, precaution, and
complained of (or that there is declaration in a final judgment
vigilance which the circumstances justly demand.
that the fact from which the civil liability might arise did not
o Fault requires the execution of a positive act which
exist).
causes damage to another, while negligence consists of the
o The responsibility arising from fault or negligence in a quasi-  In fine, a liability for tort may arise even under a contract, where tort
delict is entirely separate and distinct from the civil is that which breaches the contract (LRTA v. Navidad).
liability arising from negligence under the Penal Code. o Stated differently, when an act which constitutes a breach of
 Even if the cause of action ex quasi delicto had already prescribed, contract would have itself constituted the source of a quasi-
the subsidiary liability of the employer under delict can still be delictual liability had no contract existed between the parties,
enforced. This is so because the prescription of the action ex quasi the contract can be said to have been breached by tort,
delicto does not operate as a bar to an action to enforce the civil thereby allowing the rules on tort to apply.
liability arising from crime. (Sps. Santos v. Hon. Pizardo) o This doctrine can aptly govern only where the act or
 The death of the accused pending appeal of his conviction omission complained of would constitute an actionable
extinguishes his criminal liability as well as the civil liability directly tort independent of the contract.
arising from and based solely on the offense committed, i.e., civil  The test (whether a quasi-delict can be deemed to underlie the
liability ex delicto in senso strictiore, but not the civil liability based breach of a contract) can be stated thusly: Where, without a pre-
on quasi-delict. (People v. Bayotas) existing contract between two parties, an act or omission can
nonetheless amount to an actionable tort by itself, the fact that the
Effect of Pre-existing Contractual Relations parties are contractually bound is no bar to the application of quasi-
(1) GR: As a rule, if there is a pre-existing contractual relation delict provisions to the case (Far East Bank v. CA)
between the parties, recovery is not allowed based on quasi- o However, if the act complained of would not give rise to a
delict (GSIS v. Sps. Labung-Dean). cause of action for a quasi-delict independent of the contract,
 Hence, in some decisions of the Court (St. Martin v. LWV then the provisions on quasi-delict or tort would be
Construction), the absence of such pre-existing contractual inapplicable. (Orient)
relations is included as one of the elements of quasi-delict.
 Generally, therefore, Article 2176 does not apply when the 2. Negligence Causing Injury
party’s negligence occurs in the performance of an obligation.
o The negligent act would give rise to a quasi-delict only when Article 20, NCC. Every person who, contrary to law, wilfully or
it may be the basis for an independent action were the negligently causes damage to another, shall indemnify the latter for
parties not otherwise bound by a contract (Orient Freight the same.
International v. Keihin-Everett).
 Actions based on contractual negligence and actions based on (a) Applicable Law
quasi-delicts differ in terms of conditions, defenses, and proof.  CC makes liability for negligence clear under Article 2176 and
They generally cannot co-exist. Article 20 (Abrogar v. Cosmos Bottling Company).
 In St Martin Polyclinic, Inc. v. LWV Construction Corporation, the
The Court differentiates quasi-delict (culpa aquiliana) and breach of Court clarified the application of Articles 2176 and 20 in relation to
contract (culpa contractual), as follows: negligent acts or omissions.
 Article 20 concerns “violations of existing law as basis for an
Quasi-Delict Breach of Contract injury,” whereas Article 2176 applies when the negligent act
negligence is direct, substantive, negligence is merely incidental causing damage to another does not constitute “a breach of
and independent to the performance of the an existing law or a pre-existing contractual obligation.”
contractual obligation; there is a
pre-existing contract or (b) Concept of Negligence
obligation Article 1173, NCC. The fault or negligence of the obligor consists in
the defense of “good father of a such is not a complete and the omission of that diligence which is required by the nature of the
family” is a complete and proper proper defense in the selection obligation and corresponds with the circumstances of the persons, of
defense insofar as parents, and supervision of employees the time and of the place. When negligence shows bad faith, the
guardians, and employers are provisions of articles 1171 and 2201, paragraph 2, shall apply.
concerned
there is no presumption of negligence is presumed so long If the law or contract does not state the diligence which is to be
negligence and it is incumbent as it can be proved that there observed in the performance, that which is expected of a good father
upon the injured party to prove was breach of the contract and of a family shall be required.
the negligence of the defendant; the burden is on the defendant to
otherwise, the former’s prove that there was no Definition: Negligence is the failure to observe for the protection of the
complaint will be dismissed negligence in the carrying out of interests of another person that degree of care, precaution, and vigilance
the terms of the contract; the rule which the circumstances justly demand, whereby such other person
of respondeat superior is suffers injury (Abrogar). Under Article 1173, it consists of the “omission
followed of that diligence which is required by the nature of the obligation and
(Huang v. PH Hoteliers Inc.) corresponds with the circumstances of the person, of the time, and of
the place.”
(2) EXC: However, there are instances when Article 2176 may apply
even when there is a preexisting contractual relation. A party may Test of Negligence:
still commit a tort or quasi-delict against another, despite the  To determine the existence of negligence, the following time-
existence of a contract between them (Orient Freight). honored test has been set in Picart v. Smith: Did the defendant
 While it may be true that the pre-existing contract between the in doing the alleged negligent act use that reasonable care and
parties may, as a general rule, bar the applicability of the law on caution which an ordinarily prudent person would have used
quasi-delict, the liability may itself be deemed to arise from quasi- in the same situation?
delict, i.e., the acts which break the contract may also be a o If not, then he is guilty of negligence.
quasi-delict (Coca-Bottlers PH v. CA).
o The law here in effect adopts the standard supposed to be Article 2179, NCC. When the plaintiff’s own negligence was the
supplied by the imaginary conduct of the discreet pater immediate and proximate cause of his injury, he cannot recover
familias of the Roman law. damages. But if his negligence was only contributory, the immediate
 The existence of negligence in a given case is not determined by and proximate cause of the injury being the defendant’s lack of due
reference to the personal judgment of the actor in the situation care, the plaintiff may recover damages, but the courts shall mitigate
before him. The law considers what would be reckless, the damages to be awarded.
blameworthy, or negligent in a man of ordinary intelligence and
prudence and determines liability by that.  When the plaintiff’s own negligence was the immediate and
proximate cause of his injury, he cannot recover damages.
Foreseeability Test: Foreseeability is the fundamental test of  However, if the negligence of the plaintiff was only contributory,
negligence. To be negligent, a defendant must have acted or failed to the immediate and proximate cause of the injury being the
act in such a way that an ordinary reasonable man would have defendant’s lack of due care, the plaintiff may recover damages,
realized that certain interests of certain persons were but the courts shall mitigate the damages to be awarded.
unreasonably subjected to a general but definite class of risks  In accordance with this rule, the contributory negligence of the
(Acheverra v. Ramos). party injured will not defeat the action if it is shown that the
defendant might, by the exercise of reasonable care and prudence,
Emergency Rule: Under the “emergency rule” adopted by the Court in have avoided the consequences of the negligence of the injured
Gan v. CA, an individual, who suddenly finds himself in a situation party. The negligence of the plaintiff is, however, contributory to the
of danger and is required to act without much time to consider the accident and must be considered as a mitigating circumstance.
best means that may be adopted to avoid the impending danger, is not (Del Prado v. Meralco)
guilty of negligence if he fails to undertake what subsequently and
upon reflection may appear to be a better solution, unless the Doctrine of Last Clear Chance
emergency was brought by his own negligence (Valenzuela v. CA).  The doctrine, stated broadly, is that the negligence of the plaintiff
 Applying this principle to a case in which the victims in a vehicular does not preclude a recovery for the negligence of the
accident swerved to the wrong lane to avoid hitting two defendant where it appears that the defendant, by exercising
children suddenly darting into the street, the Court held, in reasonable care and prudence, might have avoided injurious
McKee v. IAC that the driver therein, Jose Koh, “adopted the best consequences to the plaintiff notwithstanding the plaintiff’s
means possible in the given situation” to avoid hitting the children. negligence.
Using the “emergency rule” the Court concluded that Koh, in spite  In other words, the doctrine of last clear chance means that even
of the fact that he was in the wrong lane when the collision with though a person’s own acts may have placed him in a position of
an oncoming truck occurred, was not guilty of negligence. peril, and an injury results, the injured person is entitled to recovery.
However, the emergency rule is not applicable where the danger  As the doctrine is usually stated, a person who has the last clear
or emergency is caused by the actor’s own negligence. (Delsan chance or opportunity of avoiding an accident,
Transport Lines v. C & A Construction, Inc.) notwithstanding the negligent acts of his opponent or that of
a third person imputed to the opponent is considered in law
(c) Negligence Must be Proximate Cause solely responsible for the consequences of the accident.
Requirement: (Bustamante v. CA)
 In order for liability from negligence to arise, there must be not only  Under this rule, the antecedent negligence of a person does not
proof of damage and negligence, but also proof that the preclude the recovery of damages for supervening negligence
damage was the consequence of the negligence. (Abrogar) of, or bar a defense against the liability sought by, another if the
 In other words, there must be a finding that the act or omission latter, who had the last fair chance, could have avoided the
considered as negligent was the proximate cause of the injury impending harm by the exercise of due diligence. (LBC v. CA)
caused because the negligence must have a causal connection to  The principle of “last clear chance” applies in a suit between
the accident (St. Mary’s Academy v. Carpitanos). the owners and drivers of colliding vehicles.
 However, the doctrine of proximate cause is applicable only in o It does not arise where a passenger demands
actions for quasi-delict, not in actions involving breach of responsibility from the carrier to enforce its contractual
contract. obligations, for it would be inequitable to exempt the
o The doctrine is a device for imputing liability to a person negligent driver and its owners on the ground that the other
where there is no relation between him and another party. driver was likewise guilty of negligence (PH Rabbit Bus Lines
o In such a case, the obligation is created by law itself. But, v. IAC)
where there is a pre-existing contractual relation between the o However, the doctrine does not apply where the party
parties, it is the parties themselves who create the obligation, charged is required to act instantaneously, and the injury
and the function of the law is merely to regulate the relation cannot be avoided by the application of all means at hand after
thus created. (Calalas v. CA) the peril is or should have been discovered. (Bustamante)
Concept of Proximate Cause: Proximate cause is “that which, in Doctrine of Assumption of Risk
natural and continuous sequence, unbroken by any new cause,  The doctrine of assumption of risk means that one who voluntarily
produces an event, and without which the event would not have exposes himself to an obvious, known, and appreciated
occurred. (Abrogar) danger assumes the risk of injury that may result therefrom.
 To be considered the proximate cause of the injury, the negligence  It rests on the fact that the person injured has consented to relieve
need not be the event closest in time to the injury; a cause is the defendant of an obligation of conduct toward him and to take
still proximate, although farther in time in relation to the injury, if the his chance of injury from a known risk, and whether the former has
happening of it set other foreseeable events into motion resulting exercised proper caution or not is immaterial. (Abrogar)
ultimately in the damage.  In other words, it is based on voluntary consent, express or implied,
to accept danger of a known and appreciated risk; it may
Effect of Plaintiff’s Contributory Negligence
sometimes include acceptance of risk arising from the defendant’s (1) in motor vehicle mishaps, it is indisputably presumed that a driver
negligence, but one does not ordinarily assume risk of any was negligent if he had been found guilty of reckless driving
negligence which he does not know and appreciate. or violating traffic regulations at least twice within the next
preceding two months (2184);
As a defense in negligence cases, therefore, the doctrine requires the (2) unless there is proof to the contrary, it is presumed that a person
concurrence of three elements, namely: driving a motor vehicle has been negligent if at the time of the
(1) the plaintiff must know that the risk is present; mishap, he was violating any traffic regulation (2185);
(2) he must further understand its nature; and (3) there is a prima facie presumption of negligence on the part of the
(3) his choice to incur it must be free and voluntary. defendant if the death or injury results from his possession of
dangerous weapons or substances, such as firearms and poison
(d) Burden of Proof (2188); and
 GR: As a rule, it is the plaintiff in quasi-delict who has the burden (4) it has been said that drivers of vehicles “who bump the rear of
of proof and who is required to establish the existence of another vehicle” are presumed to be the cause of the accident,
negligence which is the basis of the action. (Calalas) unless contradicted by other evidence, the rationale behind the
 EXC: presumption is that the driver of the rear vehicle has full control of
o when the law provides for presumption of negligence; and the situation as he is in a position to observe the vehicle in front of
o when the doctrine of res ipsa loquitur is applicable. him (Raynera v. Hiceta).
Doctrine of Res Ipsa Loquitur In number (1) hereof, the owner of the vehicle who was present is
 Res ipsa loquitur literally means the thing or transaction speaks solidarily liable with his driver if he could have prevented the mishap by
for itself, or in one jurisdiction, that the thing or instrumentality the exercise of due diligence (2184[1]). If the owner was not in the motor
speaks for itself. (DM Consunji v. CA) vehicle, the provisions of Article 2180 are applicable.” (2184)
 It holds a defendant liable where the thing which caused the
injury complained of is shown to be under the latter’s B. Vicarious Liability
management and the accident is such that, in the ordinary
course of things, cannot be expected to happen if those who 1. Concept of Vicarious Liability
have its management or control use proper care. (FGU
Insurance Corp. v. GP Sarmiento Trucking Corp.) Article 2180, NCC. The obligation imposed by article 2176 is
Resort to the doctrine, however, may be allowed only when demandable not only for one’s own acts or omissions, but also for
 the event is of a kind which does not ordinarily occur in the those of persons for whom one is responsible.
absence of negligence;
 other responsible causes, including the conduct of the The father and, in case of his death or incapacity, the mother, are
plaintiff and third persons, are sufficiently eliminated by the responsible for the damages caused by the minor children who live
evidence; in their company.
 the indicated negligence is within the scope of the defendant’s
duty to the plaintiff (FGU); and Guardians are liable for damages caused by the minors or
 it is caused by an instrumentality within the exclusive control incapacitated persons who are under their authority and live in their
of the defendant or defendants (Tan v. Jam Transit, Inc.). company.
The defendant’s negligence is presumed or inferred when the The owners and managers of an establishment or enterprise are
plaintiff establishes the requisites for the application of res ipsa loquitur. likewise responsible for damages caused by their employees in the
(DM Consunji) service of the branches in which the latter are employed or on the
occasion of their functions.
Instances When Negligence is Presumed
Employers shall be liable for the damages caused by their employees
Article 2184, NCC. In motor vehicle mishaps, the owner is solidarily
and household helpers acting within the scope of their assigned
liable with his driver, if the former, who was in the vehicle, could have,
tasks, even though the former are not engaged in any business or
by the use of the due diligence, prevented the misfortune. It is
industry.
disputably presumed that a driver was negligent, if he had been found
guilty of reckless driving or violating traffic regulations at least twice
The State is responsible in like manner when it acts through a special
within the next preceding two months.
agent; but not when the damage has been caused by the official to
whom the task done properly pertains, in which case what is provided
If the owner was not in the motor vehicle, the provisions of article
in article 2176 shall be applicable.
2180 are applicable.
Lastly, teachers or heads of establishments of arts and trades shall

Article 2185, NCC. Unless there is proof to the contrary, it is
be liable for damages caused by their pupils and students or
presumed that a person driving a motor vehicle has been negligent if
apprentices, so long as they remain in their custody.
at the time of the mishap, he was violating any traffic regulation.
The responsibility treated of in this article shall cease when the

Article 2188, NCC. There is prima facie presumption of negligence
persons herein mentioned prove that they observed all the diligence
on the part of the defendant if the death or injury results from his
of a good father of a family to prevent damage.
possession of dangerous weapons or substances, such as firearms
and poison, except when the possession or use thereof is
 Article 2180 provides that a person is not only liable for one’s own
indispensable in his occupation or business.
quasi-delictual acts, but also for those persons for whom one is
responsible for. This liability is popularly known as vicarious or
imputed liability (Jayme v. Apostol).
 The principle of vicarious liability is based on the civil law principle  However, if the quasi-delict is committed by the child while he is
of paterfamilias for failure to exercise due care and vigilance over under the actual supervision, instruction, or custody of those
the acts of one’s subordinates to prevent damage to another. persons exercising special parental authority, it is the latter
(Filcar Transport Services v. Espinas) who shall be principally and solidarily liable for damages
caused by the acts or omissions of the unemancipated minor.
2. Vicarious Liability of Persons Exercising Parental  The parents, judicial guardians, or the persons exercising
Authority substitute parental authority over said minor shall be
subsidiarily liable. However, they will not be liable if they can
(a) Basis prove that they exercised the proper diligence required under the
 This principle of parental liability is a species of what is frequently particular circumstances to prevent damage. (219)
designated as vicarious liability, or the doctrine of “imputed
negligence” under Anglo-American tort law, where a person is not (c) If At Least 18 But Below 21
only liable for torts committed by himself, but also for torts Article 236, FC. Emancipation for any cause shall terminate parental
committed by others with whom he has a certain relationship and authority over the person and property of the child who shall then be
for whom he is responsible. qualified and responsible for all acts of civil life.
 Thus, parental liability is made a natural or logical
consequence of the duties and responsibilities of parents— Article 2180, NCC. The obligation imposed by article 2176 is
their parental authority—which includes the instructing, controlling, demandable not only for one’s own acts or omissions, but also for
and disciplining of the child. those of persons for whom one is responsible.
 The civil liability imposed upon parents for the torts of their minor
children living with them, may be seen to be based upon the The father and, in case of his death or incapacity, the mother, are
parental authority vested by the CC upon such parents. responsible for the damages caused by the minor children who live
 The civil law assumes that when an unemancipated child living in their company.
with its parents commits a tortious act, the parents were
negligent in the performance of their legal and natural duty Guardians are liable for damages caused by the minors or
closely to supervise the child who is in their custody and control. incapacitated persons who are under their authority and live in their
 Parental liability is, in other words, anchored upon parental company.
authority coupled with presumed parental dereliction in the
discharge of the duties accompanying such authority. The owners and managers of an establishment or enterprise are
 The parental dereliction is, of course, only presumed and the likewise responsible for damages caused by their employees in the
presumption can be overturned by proof that the parents had service of the branches in which the latter are employed or on the
exercised all the diligence of a good father of a family to occasion of their functions.
prevent the damage. Hence, the retroactive effect may not be
given to the decree of adoption so as to impose a liability upon the Employers shall be liable for the damages caused by their employees
adopting parents accruing at a time when adopting parents had no and household helpers acting within the scope of their assigned
actual or physical custody over the adopted child. tasks, even though the former are not engaged in any business or
(Tamargo v. CA) industry.
(b) If Child is Minor The State is responsible in like manner when it acts through a special
Article 221, FC. Parents and other persons exercising parental agent; but not when the damage has been caused by the official to
authority shall be civilly liable for the injuries and damages caused by whom the task done properly pertains, in which case what is provided
the acts or omissions of their unemancipated children living in their in article 2176 shall be applicable.
company and under their parental authority subject to the appropriate
defenses provided by law. Lastly, teachers or heads of establishments of arts and trades shall
be liable for damages caused by their pupils and students or
Article 219, FC. Those given the authority and responsibility under apprentices, so long as they remain in their custody.
the preceding Article shall be principally and solidarily liable for
damages caused by the acts or omissions of the unemancipated The responsibility treated of in this article shall cease when the
minor. The parents, judicial guardians or the persons exercising persons herein mentioned prove that they observed all the diligence
substitute parental authority over said minor shall be subsidiarily of a good father of a family to prevent damage.
liable.
 The applicable provisions are para. 2 and 3 of Article 2180.
The respective liabilities of those referred to in the preceding  According to Article 236 FC, the vicarious liability of those persons
paragraph shall not apply if it is proved that they exercised the proper exercising parental authority (parents and guardians) shall
diligence required under the particular circumstances. continue to be applicable provided the following conditions are
satisfied:
All other cases not covered by this and the preceding articles shall o the age of the child is at least 18 but below 21 (236 FC); and
be governed by the provisions of the Civil Code on quasi-delicts. o (ii) the child is living in their company. (2180)
 The applicable laws are the provisions of the FC. Under the FC, (d) Comparison Between FC and CC Provisions
parents and other persons exercising parental authority shall  Under Article 2180, the responsibility of the father and mother is
be civilly liable for the injuries and damages caused by the not simultaneous, but alternate. The father is primarily
acts or omissions of their unemancipated children living in responsible while the mother answers only “in case of his death or
their company and under their parental authority subject to the incapacity (Romano v. Pariñas).
appropriate defenses provided by law (221 FC).  Under Article 221 FC, the responsibilities of the father and mother
are now simultaneous and not alternate.
enrichment, the registered owner of the motor vehicle has

3. Vicarious Liability of Employers a right to be indemnified by the actual employer of the
driver of the amount that he may be required to pay as
(a) Concept damages for the injury caused to another. (Filcar)
 When the employee causes damage due to his own negligence  In Mamaril v. Boy Scouts of the Philippines, the Court found that
while performing his own duties, there arises the juris tantum there was no employer-employee relationship between Boy Scouts
presumption that the employer is negligent, rebuttable only by of the Philippines (BSP) and the security guards assigned to it by
proof of observance of the diligence of a good father of a family an agency pursuant to a Guard Service Contract. In the absence
(Reyes v. Doctolero). of such relationship, vicarious liability under Article 2180 cannot
 The “diligence of a good father” referred to in the last paragraph of apply as against BSP. It is settled that where the security agency
Article 2180 means diligence in the selection and supervision recruits, hires, and assigns the work of its watchmen or
of employees. security guards, the agency is the employer of such guards
 In other words, to avoid liability for a quasi-delict committed by his and watchmen. Liability for illegal or harmful acts committed
employee, an employer must overcome the presumption by by the security guards attaches to the employer agency, and
presenting convincing proof that he exercised the care and not to the clients or customers of such agency (Soliman v. Tuazon).
diligence of a good father of a family in the selection and  In the absence of an employer-employee relationship
supervision of his employee. (Delsan) establishing vicarious liability, the driver’s negligence should
 Plaintiff may sue either the EMPLOYEE or EMPLOYER alone. not be attributed to a fellow employee who only happens to be
o Their liabilities are different. an occupant of the vehicle. Whatever right of control the
o The negligence of the employer is with regard to his selection occupant may have over the driver is not sufficient by itself to justify
and supervision of the employee. This is also the proximate an application of the doctrine of vicarious liability. (Jayme)
cause of the injury. This is why when EE and ER are sued,
they are considered JOINT TORTFEASORS, who are Performing Assigned Task
solidarily liable.  The burden of proving that the employee was acting within the
o It is only in quasi-delict where the employee and employer are scope of his assigned task is incumbent upon the plaintiff and
solidary liable. not on the employer. It is enough for the employer to deny that the
employee was acting within the scope of his duties. (Castilex)
(b) Requisites for Employer’s Presumed Liability  In Filainer Christian Institute v. IAC, the Court had the occasion to
Proof of Two Requisites hold that, the clause “within the scope of their assigned tasks”
In order for the presumed liability of the employer to attach, Article 2180 for purposes of raising the presumption of liability of an employer,
requires proof of two things: includes any act done by an employee in furtherance of the
(1) existence of an employer-employee relationship; and interests of the employer or for the account of the employer at
(2) that the employee acted within the scope of his or her assigned the time of the infliction of the injury or damage.
tasks. (Caravan Travel v. Abejar)
Registered-Owner Rule
It is only after proving such requisites that the employer may find it  Under the registered owner rule, the registered owner of a motor
necessary to interpose the defense of due diligence in the selection and vehicle is liable for death or injuries caused by the operation
supervision of the employee. (Castilex Industrial v. Vasquez) of the vehicle (Filcar).
Burden is incumbent on the plaintiff. o The only thing the plaintiff needs to prove is that he is the
registered owner. (No need for EE-ER relationship, etc.)
Employer-Employee Relationship o Pre-2016: conflicting decisions.
 It is necessary to establish the employer-employee relationship o Decisions ni J. Leonen
(Castilex), for the same cannot be assumed (Jayme). It is  Aquino v. Aquino
incumbent upon the plaintiff to prove the relationship by  Tan-Andal v. Andal
preponderant evidence.  Alanis III v. CA
 In Belen v. Belen, the Court ruled that it was enough for the  The principle upon which this doctrine is based is that in dealing
defendant to deny an alleged employment relationship. The with registered motor vehicles, the public has the right to assume
defendant is under no obligation to prove the negative averment. or presume that the registered owner is the actual owner
 In Filcar Transport Services v. Espinas: the Court held that the thereof, for it would be difficult for the public to enforce the
registered owner is deemed the employer of the negligent driver, actions that they may have for injuries caused to them by the
and is thus vicariously liable under Article 2176, in relation to Article vehicles being negligently operated if the public should be required
2180. Citing Equitable Leasing Corporation v. Suyom,K the Court to prove who the actual owner is (Erezo v. Jepte).
ruled that insofar as third persons are concerned, the o Plaintiff doesn’t need to know who the actual owner is.
registered owner of the motor vehicle is the employer of the o In one case, the vehicle was sold but transfer of title was not
negligent driver, and the actual employer is considered merely as complete yet. They had a memorandum of agreement
an agent of such owner. wherein the buyer would be liable should there be damage
o Thus, whether there is an employer-employee caused by the operation of the bus. SC said the plaintiff may
relationship between the registered owner and the driver recover from the REGISTERED OWNER. But the registered
is irrelevant in determining the liability of the registered owner may recover from the buyer.
owner who the law holds primarily and directly  Remedy of the registered owner is to file a Third-Party
responsible for any accident, injury, or death caused by the Complaint.
operation of the vehicle in the streets and highways (Mendoza  In BA Finance Corp. v. CA, the Court held the registered owner
v. Gomez). liable even if, at the time of the accident, the vehicle was leased by
o This does not mean, however, that the registered owner is left another party and was driven by the lessees employee.
without any recourse against the actual employer of the driver  In Aguilar, Sr. v. Commercial Savings Bank the registered-owner
and the driver himself. Under the civil law principle of unjust bank answered for damages for the accident even if the vehicle
was being driven by the Vice-President of the Bank in his private o It is not enough that the employees chosen be competent and
capacity and not as an officer of the Bank, as claimed by the Bank. qualified, inasmuch as the employer is still required to
 The issue of whether or not the driver of the vehicle during the exercise due diligence in supervising its employees.
accident was authorized is not at all relevant in determining the  In the selection of prospective employees, employers are
liability of the registered owner. This must be so if we are to comply required to examine them as to their qualifications, experience,
with the rationale and principle behind the registration requirement and service records (MM Transit Corp. v. CA).
under the motor vehicle law. (Villanueva v. Domingo)  On the other hand, due diligence in supervision requires the
formulation of rules and regulations for the guidance of
Where Employer is Also Registered Owner of Vehicle employees and the issuance of proper instructions as well as
 In a situation where the employer is also the registered owner of actual implementation and monitoring of consistent compliance
the vehicle which caused the injury, the decisions of the Court in with the rules (Fabre v. CA).
the past are conflicting. There are decisions which relied on the o To establish diligence in the supervision of employees, the
requisites of Article 2180, but there are also decisions which issuance of company policies must be coupled with proof of
applied the registered owner rule. compliance (Caravan).
 In Aguilar Sr. v. Commercial Savings Bank and Del Carmen, Jr. v.  Unlike in culpa aquiliana (quasi-delict), the defense of exercising
Bacoy, the Court preferred the registered owner rule over the the required diligence in the selection and supervision of
requirements of Article 2180. employees is not a complete defense in culpa contractual
 In Filcar Transport Services v. Espinas, the Court in fact ruled that (Consolidated Bank and Trust Corp. v. CA)
the registered owner of a vehicle can no longer use the defenses  Under Article 1172, “liability (for culpa contractual) may be
found in Article 2180. regulated by the courts, according to the circumstances.”
 In Caravan Travel and Tours International, Inc. v. Abejar, the o This means that if the defendant exercised the proper
Court harmonized those conflicting rulings. The Court ruled therein diligence in the selection and supervision of its employee, or
that Aguilar, Sr., Del Carmen, and Filcar Mendoza should not be if the plaintiff was guilty of contributory negligence, then the
taken to mean that Article 2180 should be completely discarded in courts may reduce the award of damages.
cases where the registered-owner rule finds application.
o In harmonizing the registered-owner rule with Articles 2176 Different from actual operator
and 2180, the Court held that the appropriate approach in
cases where both the registered-owner rule and Article 2180 (d) Nature of Employer’s Liability
apply is that the plaintiff must first establish that the (1) Under Article 2180: The liability of the employer for the negligent
employer is the registered owner of the vehicle in conduct of the subordinate is direct and primary, subject to the
question. Once the plaintiff successfully proves ownership, defense of due diligence in the selection and supervision of the
there arises a disputable presumption that the employee. The enforcement of the judgment against the employer
requirements of Article 2180 have been proven. As a in an action based on Article 2176 does not require the employee
consequence, the burden of proof shifts to the defendant to be insolvent since the nature of the liability of the employer with
(employer) to show that no liability under Article 2180 has that of the employee, the two being statutorily considered joint
arisen. tortfeasors, is solidary."0
o This it can do by presenting proof of any of the following: (2) Article 2180 Inapplicable in Delict: If the cause of action against the
 first, that it has no employment relationship with the employee is based on delict, it is not correct to hold the employer
alleged employee; jointly and severally liable with the employee, based on quasi-delict
 second, that the employee acted outside the scope of his under Articles 2176 and 2180 of the Civil Code. Articles 2176 and
assigned tasks; or 2180 of the Civil Code pertain to the vicarious liability of an
 third, that it exercised the diligence of a good father of a employer for quasi-delicts that an employee has committed. Such
family in the selection and supervision of the employee. provisions of law do not apply to civil liability arising from delict.1"
(3) Compared with Employer’s Liability in Delict: In delict, the liability
(c) Employer’s Defense of the employer is merely subsidiary,"2 not solidary.
Article 1172, NCC. Responsibility arising from negligence in the Before the employers’ subsidiary liability is enforced, adequate evidence
performance of every kind of obligation is also demandable, but such must exist establishing that:
liability may be regulated by the courts, according to the (1) they are indeed the employers of the convicted employees;
circumstances. (2) they are engaged in some kind of industry;
(3) the crime was committed by the employees in the discharge of their
Defenses duties; and
 Deny EE-ER relationship (4) the execution against the latter has not been satisfied due to
 At the time of the injury, employee was not pursuing an assigned insolvency. (Calang v. People)
task or duty
 He exercised diligence in the selection and supervision of the 4. Vicarious Liability of Schools, Administrators, and
employee Teachers
 To avoid liability for a quasi-delict committed by his employee, an Article 218, FC. The school, its administrators and teachers, or the
employer must overcome the presumption by presenting individual, entity or institution engaged in child are shall have special
convincing proof that he exercised the care and diligence of a parental authority and responsibility over the minor child while under
good father of a family in the selection and supervision of his their supervision, instruction or custody.
employee (Delsan).
o It should be stressed that the required diligence of a good Authority and responsibility shall apply to all authorized activities
father of a family pertains not only to the selection, but also to whether inside or outside the premises of the school, entity or
the supervision of employees. institution.
(a) When Student is a Minor injuries suffered by a student of the school was caused by
 If the student who commits the quasi-delict is still a minor, the outsiders (or not students of the school) (PSBA v. CA).
provisions of the FC will apply.  ITC, the recovery of damages is based on the relationship
 Under the FC, when a minor student commits a quasi-delict while between the student-victim and the school, with their
he or she is under the actual supervision, instruction, or relationship being based on the enrollment contract. Hence, the
custody of those persons granted special parental authority, school’s liability to its student who suffered injuries inside the
o it is the latter who shall be principally and solidarily liable school premises shall be based upon the “enrollment contract”
for damages caused by the acts or omissions of the rule.
unemancipated minor;
o while the parents, guardians, or the persons exercising Enrollment Contract Rule
parental authority over said minor shall be subsidiarily  Under the enrollment contract, institutions of learning have the
liable (219 FC). “built-in” obligation of providing a conducive atmosphere for
o They shall not be liable, however, if they are able to prove that learning, an atmosphere where there are no constant threats to
they exercised the proper diligence required under the life and limb, and one where peace and order are maintained.
particular circumstances to prevent damage. o it is a “built-in” obligation of the school to ensure the safety of
its students while they are inside the school premises.
Under the FC, the following shall have parental authority over the minor  A breach of this obligation shall render the school liable to its
child under their supervision, instruction, or custody (218 FC): students.
 (1) the school;  In Saludaga v. FEU, where a sophomore law student of the FEU
 (2) its administrators; was shot and injured by one of the security guards on duty at the
 (3) its teachers; or school premises, the Court held the school liable for breach of the
 (4) the individual, entity, or institution engaged in child care. school-student (enrollment) contract because the school failed to
Ordinarily, such special parental authority is limited within the prove that it exercised due diligence in order to prevent damage.
confines of the school premises. However, such special parental  Under the enrollment contract rule, however, the school may still
authority shall also apply even outside the premises of the school, entity, avoid liability by proving that the breach of its contractual
or institution so long as the minor is pursuing an authorized activity. obligation to the students was not due to its negligence. (St.
Luke’s College of Medicine v. Perez)
(b) When Student is No Longer a Minor
Applicable law: The applicable law is Article 2180, paragraph 7 CC. 5. Vicarious Liability of the State
 The said provision is applicable to all schools, academic as well
as non-academic. (a) Two Aspects
 Where the school is academic rather than technical or The liability of the State has two aspects, namely:
vocational in nature, responsibility for the tort committed by the (1) Its public or governmental aspect where it is liable for the tortious
student will attach to the teacher in charge of such student, acts of special agents only; and
following the first part of the provision. This is the general rule. (2) Its private or business aspect (as when it engages in private
 In the case of establishments of arts and trades, it is the head enterprises) where it becomes liable as an ordinary employer
thereof, and only he, who shall be held liable as an exception to (Fontanilla v. Maliaman).
the general rule.
 In other words, teachers in general shall be liable for the acts  In the first, the State assumes a limited liability for the damage
of their students except where the school is technical in caused by the tortious acts or conduct of its special agent.
nature, in which case it is the head thereof who shall be  Under the CC, the State is responsible vicariously when it acts
answerable. (Amadora v. CA) through a special agent; but not when the damage has been
caused by the official to whom the task done properly
When Student is Considered Under Custody pertains, in which case what is provided in Article 2176 shall be
 The student is in the custody of the school authorities as long as applicable (2180[6]).
he is under the control and influence of the school and within o If NOT A SPECIAL AGENT, state is not liable.
its premises, whether the semester has not yet begun or has o If the injury pertains to non-governmental functions, the state
already ended. is deemed an ordinary employer.
 As long as it can be shown that the student is in the school  Under this rule, the State assumes a limited liability for the damage
premises in pursuance of a legitimate student objective, in the caused by the tortious acts or conduct of its special agent.
exercise of a legitimate student right, and even in the enjoyment of
a legitimate student privilege, the responsibility of the school (b) Special Agent
authorities over the student continues. (1) If Public Official: The State’s agent, if a public official, must not
 Indeed, even if the student should be doing nothing more than only be specially commissioned to do a particular task but that such
relaxing in the campus in the company of his classmates and task must be foreign to said official’s usual governmental
friends and enjoying the ambience and atmosphere of the school, functions.
he is still within the custody and subject to the discipline of the (2) If Private Person:
school authorities under the provisions of Article 2180. (Amadora) (a) If the State’s agent is not a public official, and is
commissioned to perform non-governmental functions,
When Assailant is Not Its Student then the State assumes the role of an ordinary employer
 Article 2180 plainly provides that the damage should have been and will be held liable as such for its agent’s tort.
caused or inflicted by pupils or students of the educational (b) Where the government commissions a private individual for a
institution sought to be held liable for the acts of its pupils or special governmental task, it is acting through a special
students while in its custody. Said law does not apply where the agent within the meaning of the provision. Certain
functions and activities, which can be performed only by the
government, are more or less generally agreed to be
"governmental" in character, and so the State is immune prove that it exercised due diligence in the selection and
from tort liability. supervision of its employee.
(c) On the other hand, a service which might as well be
provided by a private corporation, and particularly when it C. Special Cases
collects revenues from it, the function is considered a
“proprietary” one. as to which there may be liability for the torts 1. Liability without Fault
of agents within the scope of their employment.
(a) Possessors or Users of Animals
(c) Test of liability Article 2183, NCC. The possessor of an animal or whoever may
(1) If Discharging Governmental Functions make use of the same is responsible for the damage which it may
RULE: If the injury is caused in the course of the performance of a cause, although it may escape or be lost. This responsibility shall
governmental function or duty, the principle of non-suability of the cease only in case the damage should come from force majeure or
State applies. Hence, the State is also not liable. from the fault of the person who has suffered damage.
 However, for LGUs, the Local Government Code of 1991 provides
that LGUs and their officials are not exempt from liability for  The possessors of an animal or whoever may make use of the
the death or injury to persons or damage to property (Sec. 24, same is responsible for the damage which it may cause,
RA 7160/LGC). Hence, LGUs (provinces, cities, and municipalities) although it may escape or be lost.
may be sued.  However, the foregoing responsibility shall cease only in case the
 Nevertheless, they are generally not liable for torts committed damage should come from force majeure or from the fault of
by them in the discharge of governmental functions and can the person who has suffered damage. (2183).
be held answerable only if it can be shown that they were
acting in a proprietary capacity. (b) Product Liability
 For example, when an employee of the Municipality of San Article 2187, NCC. Manufacturers and processors of foodstuffs,
Fernando was driving the municipal’s dump truck to get gravel and drinks, toilet articles and similar goods shall be liable for death or
sands for the repair of roads, the truck collided with a passenger injuries caused by any noxious or harmful substances used, although
jeepney resulting into death and physical injuries of some of the no contractual relation exists between them and the consumers.
passengers of the jeep. The Court ruled that since the employee of
the Municipality was performing a governmental function, the  Manufacturers and processors of foodstuffs, drinks, toilet articles,
municipality cannot be held liable for the torts committed by its and similar goods shall be liable for death or injuries caused by any
regular employee, who was then engaged in the discharge of noxious or harmful substances used, although no contractual
governmental functions. (Municipality of San Fernando v. Firme) relation exists between them and the consumers.
 However, in order to establish liability for death or injury under
EXC: It is a well-entrenched rule in this jurisdiction, embodied in Article Article 2187 CC, the injured plaintiff seeking recovery of
2180, that the State is liable only for torts caused by its special damages therefor must allege and prove that:
agents, specially commissioned to carry out the acts complained of o (1) the defendant is a manufacturer or processor of foodstuff,
outside of such agent’s regular duties (Republic v. Palacios). drinks, toilet articles, and similar goods;
 However, the State is not liable for the damage caused by o (2) he used noxious or harmful substances in the manufacture
public officials who are in the performance of their usual or processing of the foodstuff, drink, or toilet articles
governmental functions. consumed or used by the plaintiff;
o In the latter case, the said public official may be held liable o (3) the plaintiff’s death or injury was caused by the products
for the commission of quasi-delict under Article 2176 so consumed or used; and
(2180[6]). o (4) the damages sustained and claimed by the plaintiff and the
 For example, when the Irrigation Service Unit (ISU), an office of the amount thereof.
Department of Public Works and Communications, was sued for
damages because it allegedly induced the Handong Irrigation (c) Liability of Head of Family:
Association, Inc. to invade and occupy the land of the plaintiff Article 2193, NCC. The head of a family that lives in a building or a
Ildefonso Ortiz, the Court ruled that the ISU is an office in the part thereof, is responsible for damages caused by things thrown or
Government of the Republic of the Philippines performing falling from the same.
governmental functions. Hence, neither the State nor its funds can
be made liable for the alleged tortious inducement committed by The head of a family that lives in a building or a part thereof, is
ISU since it is not a special agent. (Republic v. Palacios) responsible for damages caused by things thrown or falling from the
same.
(2) If Discharging Private or Proprietary Functions
 If the State or the LGUs engages in private or proprietary 2. Other Cases of Tort Liability
functions, it becomes liable as an ordinary employer under
Article 2180, par. 5 (Fontanilla) (a) Liability of LGUs
 To illustrate, when a driver-employee of the National Irrigation Article 2189, NCC. Provinces, cities and municipalities shall be liable
Administration (NIA), on official business using the NIA’s vehicle, for damages for the death of, or injuries suffered by, any person by
bumped a bicycle rider resulting into the rider’s death, the Court reason of the defective condition of roads, streets, bridges, public
held the NIA liable for the tortious act of its driver-employee as an buildings, and other public works under their control or supervision.
ordinary employer under paragraph 5 of Article 2180. Since the NIA
is a government corporation with juridical personality and not a  Provinces, cities, and municipalities shall be liable for damages for
mere agency of the government performing non-governmental the death of, or injuries suffered by, any person by reason of the
functions, it assumes the responsibility of an ordinary employer and defective condition of roads, streets, bridges, public buildings, and
as such, it becomes answerable for damages because it failed to other public works under their control or supervision (2189).
 It is not necessary that the defective roads or streets belong to the Article 2192, NCC. If damage referred to in the two preceding
province, city, or municipality. What the law requires is that the articles should be the result of any defect in the construction
province, city, or municipality have either “control or supervision” mentioned in article 1723, the third person suffering damages may
over said street or road (City of Manila v. Teotico). proceed only against the engineer or architect or contractor in
accordance with said article, within the period therein fixed.
(b) Liability of Proprietors
(1) For Collapse of Buildings or Structures Article 1723, NCC. The engineer or architect who drew up the plans
Article 2190, NCC. The proprietor of a building or structure is and specifications for a building is liable for damages if within fifteen
responsible for the damages resulting from its total or partial collapse, years from the completion of the structure, the same should collapse
if it should be due to the lack of necessary repairs. by reason of a defect in those plans and specifications, or due to the
defects in the ground. The contractor is likewise responsible for the
 The proprietor of a building or structure is responsible for the damages if the edifice falls, within the same period, on account of
damages resulting from its total or partial collapse, if it should be defects in the construction or the use of materials of inferior quality
due to the lack of necessary repairs (2190). furnished by him, or due to any violation of the terms of the contract.
 If a building, wall, column, or any other construction is in danger If the engineer or architect supervises the construction, he shall be
of falling, the owner shall be obliged to demolish it or to execute solidarily liable with the contractor.
the necessary work in order to prevent it from falling (482[1]).
o In this situation, if the structure falls or collapses the owner Acceptance of the building, after completion, does not imply waiver
shall be liable for damages caused even if the same is by of any of the causes of action by reason of any defect mentioned in
reason of fortuitous event because the owner is already the preceding paragraph.
negligent for failing to take the necessary measures to insure
public safety. The action must be brought within ten years following the collapse of
the building.
(2) For Falling Trees
Article 2191, NCC. Proprietors shall also be responsible for  If the building or structure collapses within 15 years from the
damages caused: completion of the structure by reason of a defect in the plans
(1) By the explosion of machinery which has not been taken care and specifications drawn by an engineer or an architect, or due
of with due diligence, and the inflammation of explosive to the defects in the ground, the third person suffering damages
substances which have not been kept in a safe and adequate may proceed only against the engineer or architect within 10
place; years following the collapse of the building (2192 IRT 1723).
(2) By excessive smoke, which may be harmful to persons or  If the edifice falls within 15 years from the completion of the
property; structure, on account of defects in the construction or the use
(3) By the falling of trees situated at or near highways or lanes, if of the materials of inferior quality furnished by him, or due to
not caused by force majeure; any violation of the terms of the contract, the third person
(4) By emanations from tubes, canals, sewers or deposits of suffering damages may proceed only against the contractor
infectious matter, constructed without precautions suitable to within 10 years following the collapse of the building.
the place. o In the latter case, if the engineer or architect supervises the
construction, he shall be solidarily liable with the contractor.
 Proprietors shall be liable for damages caused by the falling of (1723)
trees situated at or near highways or lanes, if not caused by force
majeure (2191[3]). (d) Tortious Interference with Contractual Relations
 Whenever a large tree threatens to fall in such a way as to Concept
cause damage to the land or tenement of another or to Article 1314, NCC. Any third person who induces another to violate
travelers over a public or private road, the owner of the tree shall his contract shall be liable for damages to the other contracting party.
be obliged to fell and remove it; and should he not do so, it shall be
done at his expense by order of the administrative authorities (483).  Article 1314 provides that any third person who induces another to
o In this situation, if the tree falls the owner shall be liable for violate his contract shall be liable for damages to the other
damages caused even if the same is by reason of fortuitous contracting party.
event because the owner is already negligent for failing to take o The tort recognized in that provision is known as interference
the necessary measures to insure public safety. with contractual relations.
o The interference is penalized because it violates the property
(3) Other Liabilities rights of a party in a contract to reap the benefits that should
 Proprietors shall also be responsible for damages caused: result therefrom (Lagon v. CA).
o by the explosion of machinery which has not been taken care
with due diligence, and the inflammation of explosive Elements of Tortious Interference
substances which have not been kept in a safe and adequate The Court, in the case of So Ping Bun v. CA, laid down the elements of
place; tortious interference with contractual relations:
o by the excessive smoke, which may be harmful to persons or (1) existence of a valid contract;
property; and (2) knowledge on the part of the third person of the existence of the
o by emanations from tubes, canals, sewers, or deposits of contract; and
infectious matter, constructed without precautions suitable to (3) interference of the third person without legal justification or excuse.
the place.  As regards the first element, the existence of a valid contract must
be duly established. (Lagon)
(c) Liability of Builders and Architects  The second element requires that there be knowledge on the part
of the interferer that the contract exists.
o Knowledge of the subsistence of the contract is an essential  Although liability under Article 2180 originates from the negligent
element to state a cause of action for tortious interference. act of the employee, the aggrieved party may sue the employer
o A defendant in such a case cannot be made liable for directly. When an employee causes damage, the law presumes
interfering with a contract he is unaware of. that the employer has himself committed an act of negligence
o While it is not necessary to prove actual knowledge, he must in not preventing or avoiding the damage. This is the fault that
nonetheless be aware of the facts which, if followed by a the law condemns.
reasonable inquiry, will lead to a complete disclosure of the  Stated otherwise, the employer is also civilly liable directly and
contractual relations and rights of the parties in the contract. separately for his own civil negligence in failing to exercise due
 Anent the third element, the interferer may be held liable only diligence in selecting and supervising his employee.
when there was no legal justification or excuse for his action or  The action can be brought directly against the person responsible
when his conduct was stirred by a wrongful motive. To sustain a (for another), without including the author of the act.
case for tortious interference, the defendant must have acted with  The action against the principal is accessory in the sense that it
malice or must have been driven by purely impious reasons to implies the existence of a prejudicial act committed by the
injure the plaintiff. In other words, his act of interference cannot be employee, but it is not subsidiary in the sense that it cannot be
justified. instituted till after the judgment against the author of the act or at
least, that it is subsidiary to the principal action; the action for
Advancement of Proper Business Interest, Not Malicious responsibility (of the employer) is in itself a principal action (Barredo
Interference v. Garcia).
 In the very early case of Gilchrist v. Cuddy, the Court declared that
a person is not a malicious interferer if his conduct is impelled by a (b) If Sued with the Employee, Employer is Solidarily Liable
proper business interest. Article 2194, NCC. The responsibility of two or more persons who
 In other words, a financial or profit motivation will not necessarily are liable for quasi-delict is solidary.
make a person an officious interferer liable for damages as long as
there is no malice or bad faith involved.  Under Article 2180 an employer may be held solidarily liable for the
negligent acts of his employee (Delsan).
D. Joint Tortfeasors  While Article 2180 does not expressly provide for solidary liability,
the same can be inferred from the wordings of the first paragraph
1. Concept and Nature of Liability of Article 2180 which states that “the obligation imposed by article
2176 is demandable not only for one’s own acts or omissions, but
(a) Concept also for those of persons for whom one is responsible (Sps.
 Joint tortfeasors are all the persons who command, instigate, Hernandez v. Sps. Dolor).
promote, encourage, advise, countenance, cooperate in, aid, or  Moreover, Article 2180 should be read with Article 2194, which
abet the commission of a tort, or who approve of it after it is done, categorically states that the responsibility of two or more
if done for their benefit (Filipinas Broadcasting Network, Inc. v. persons who are liable for quasi-delict is solidary. In other
Ago Medical). words, the liability of joint tortfeasors is solidary. Verily, under
 They are each liable as principals, to the same extent and in the Article 2180, an employer may be held solidarity liable for the
same manner as if they had performed the wrongful act themselves negligent acts of his employee.
(Lafarge Cement v. Continental Cement Corporation).
(c) Solidary Liability Attaches Even If Driver is Sued Under Quasi-
(b) Solidary Liability of Joint Tortfeasors delict and Employer Under Culpa Contractual
Article 2194, NCC. The responsibility of two or more persons who In Fabre, Jr. v. CA, where the driver and the common carrier were sued
are liable for quasi-delict is solidary. together, the Court made this pronouncement: “it is unnecessary for our
Applies to EE-ER who are sued together under quasi-delict. purpose to determine whether to decide this case on the theory that
Q. What if the employee is sued on quasi-delict but the employer is sued petitioners are liable for breach of contract of carriage or culpa
based on breach of contract? contractual or on the theory of quasi delict or culpa aquiliana as both the
 Example: contract of carriage RTC and CA held, for although the relation of passenger and carrier is
 Fabre v. CA: court applied 2194 ‘contractual both in origin and nature,’ nevertheless ‘the act that breaks
the contract may be also a tort.’ In either case, the question is whether
 The responsibility of two or more persons who are liable for quasi- the bus driver, petitioner Porfirio Cabil, was negligent.” In the said case,
delict is solidary. the common carrier was held liable under the contract of carriage while
 Joint tortfeasors are jointly and severally liable for the tort which the driver was held liable under quasi-delict, and the liability of the two
they commit. The persons injured may sue all of them or any was declared to be solidary.
number less than all. Each is liable for the whole damages caused
by all, and all together are jointly liable for the whole damage. It is 3. Concurring Negligence of Two or More Persons Resulting
no defense for one sued alone that the others who participated in Damage to Third Party
in the wrongful act are not joined with him as defendants; nor
is it any excuse for him that his participation in the tort was  It may be said, as a general rule, that negligence in order to render
insignificant as compared to that of the others. (Lafarge) a person liable need not be the sole cause of an injury. It is
sufficient that his negligence, concurring with one or more efficient
2. Solidary Liability of Employer and Employee under causes other than plaintiff’s, is the proximate cause of the injury.
Quasi-delict  Accordingly, where several causes combine to produce injuries, a
person is not relieved from liability because he is responsible for
(a) For Negligent Act of Employee, Employer May be Sued Alone only one of them, it being sufficient that the negligence of the
 An employer’s liability based on a quasi-delict is primary and direct person charged with injury is an efficient cause without which the
(Cerezo v. Tuazon). injury would not have resulted to as great an extent, and that such
cause is not attributable to the person injured.
 It is no defense to one of the concurrent tortfeasors that the injury 5. Solidarity Liability of Operators and Drivers of Colliding
would not have resulted from his negligence alone, without the Vehicles
negligence or wrongful acts of the other concurrent tortfeasor.
Where several causes producing an injury are concurrent and each The rule of solidary liability was applied in situations where the
is an efficient cause without which the injury would not have negligence of the driver of the bus on which the plaintiff was riding
happened, the injury may be attributed to all or any of the causes concurred with the negligence of a third party who was the driver of
and recovery may be had against any or all of the responsible another vehicle, thus causing an accident (Fabre).
persons although under the circumstances of the case, it may  In Anuran v. Buno, Batangas Laguna Tayabas Bus Co. v. IAC, and
appear that one of them was more culpable, and that the duty owed Metro Manila Transit Corporation v. CA, the bus company, its
by them to the injured person was not the same. driver, the operator of the other vehicle, and the driver of the vehicle
 No actor’s negligence ceases to be a proximate cause merely were held jointly and severally liable to the injured passenger or the
because it does not exceed the negligence of other actors. Each latter’s heirs. In this situation, it does not matter that the liability of
wrongdoer is responsible for the entire result and is liable as though the bus operator springs from contract while that of the other
his acts were the sole cause of the injury. vehicle owner and its driver arises from quasi-delict (Viluan v. CA).
 There is no contribution between joint tortfeasors whose liability is  But in Philippine Rabbit Bus Lines, Inc. v. CA the Court exonerated
solidary since both of them are liable for the total damage. the jeepney driver from liability to the injured passengers and their
 Where the concurrent or successive negligent acts or omissions of families while holding the owners of the jeepney jointly and
two or more persons, although acting independently, are in severally liable, but that is because that case was expressly tried
combination the direct and proximate cause of a single injury to a and decided exclusively on the theory of culpa contractual.
third person, it is impossible to determine in what proportion each  As the Court there explained: “The trial court was therefore right in
contributed to the injury and either of them is responsible for the finding that Manalo [the driver] and spouses Mangune and Carreon
whole injury. [the jeepney owners] were negligent. However, its ruling that
 Where their concurring negligence resulted in injury or damage to spouses Mangune and Carreon are jointly and severally liable with
a third party, they become joint tortfeasors and are solidarity liable Manalo is erroneous. The driver cannot be held jointly and severally
for the resulting damage under Article 2194 (Far Eastern Shipping liable with the carrier in case of breach of the contract of carriage.
v. CA) The rationale behind this is readily discernible. Firstly, the contract
of carriage is between the carrier and the passenger, and in the
4. Liability of Common Carrier and Independent Contractor event of contractual liability, the carrier is exclusively responsible
therefore to the passenger, even if such breach be due to the
In LRTA v. Navidad, the common carrier (LRTA) was held liable under negligence of his driver.”
the contract of carriage for the death of the commuter. But in that case,
the employer of the security guard was an independent contractor
(Prudent Security Agency). So, it was asked in that case if Prudent could
likewise be held liable for the death of the commuter? The Court ruled
that, if at all, that liability could only be for tort under the provisions of
Article 2176 and related provisions, in conjunction with Article 2180. In
this case, the Court explained that the LRTA, as a common carrier and
whose liability is based on breach of contract, and Prudent, as
independent contractor and employer of the security guard who
committed the quasi-delict and whose liability is based on the
vicarious liability of the employer under Article 2180, may be
considered joint tortfeasors under Article 2194. This is because a
contractual obligation can be breached by tort and when the same act
or omission causes the injury, one resulting in culpa contractual and the
other in culpa aquiliana, Article 2194 can well apply. In fine, a liability
for tort may arise even under a contract, where tort is that which
breaches the contract. Stated differently, when an act which constitutes
a breach of contract would have itself constituted the source of a quasi-
delictual liability had no contract existed between the parties, the
contract can be said to have been breached by tort, thereby allowing the
rules on tort to apply. [Note: However, in this case, it was ruled that
Prudent is not liable since there was nothing to link Prudent to the death
of the commuter because, in the first place, the negligence of its
employee (the security guard) was not duly proven.]
 Why is Article 2194 appliable?
 Apply Air France v. Carrascoso: the act that breaks the contract is
also a tort. Thus, the provisions on quasi-delict will also be
applicable.
 This is the basis for treating the LRTA as joint tortfeasors with the
other parties.
 THUS: Fabre v. CA where the negligent driver was sued on the
basis of quasi-contract, and the employer is sued on breach of
contract. The basis is Air France.
PART 2: DAMAGES  In the absence of competent proof on the amount of actual

damages, courts may allow the party to receive temperate
E. Kinds of Damages damages.
 Temperate or moderate damages, which are more than nominal
1. Actual or Compensatory but less than compensatory damages, may be recovered when
the court finds that some pecuniary loss has been suffered but
(a) Concept its amount cannot, from the nature of the case, be proved with
 Actual or compensatory damages are those awarded in order to certainty (Kabisig Real Wealth v. Young Builders Corp.).
compensate a party for an injury or loss he suffered. They arise  The amount thereof is usually left to the discretion of the
out of a sense of natural justice and are aimed at repairing the courts but the same should be reasonable, bearing in mind that
wrong done (Estrada v. PH Rabbit Bus Lines). temperate damages should be more than nominal but less than
 Pertaining as they do to such injuries or losses that are actually compensatory (Dueñas v. Guce-Africa).
sustained and susceptible of measurement, they are intended to
put the injured party in the position in which he was before he (d) Measure of Damages
was injured (Oceaneering Contractors v. Barretto) In general: Indemnification for damages comprehends not only the
loss suffered, that is to say actual damages (damnum emergens), but
(b) Two components also profits which the obligee failed to obtain, referred to as
Article 2200, NCC. Indemnification for damages shall comprehend compensatory damages (lucrum cessans). (2200)
not only the value of the loss suffered, but also that of the profits
which the obligee failed to obtain. In Contracts and Quasi-contracts
Article 2201, NCC. In contracts and quasi-contracts, the damages
While compensatory and actual damages are dealt with in the CC under for which the obligor who acted in good faith is liable shall be those
the same Chapter 2 thereof and that the two terms are used therein as that are the natural and probable consequences of the breach of the
equivalent to one another, there are actually two components to obligation, and which the parties have foreseen or could have
actual or compensatory damages (RCPI v. CA). reasonably foreseen at the time the obligation was constituted.
 As provided for in Article 2200, which is part of Chapter 2,
indemnification for damages shall comprehend not only the value In case of fraud, bad faith, malice or wanton attitude, the obligor shall
of the loss suffered, or actual damages ("damnum emergens”), be responsible for all damages which may be reasonably attributed
but also that of the profits which the obligee failed to obtain, or to the non-performance of the obligation.
compensatory damages ("lucrum cessans”).
 Hence, it is not entirely erroneous to grant both items of damages,  In contracts and quasi-contracts, the damages for which the
as what was done in in A/D Transit & Taxi Co., Inc. v. CA. obligor who acted in good faith shall be those that are the
natural and probable consequences of the breach of the
(c) Actual Proof of Amount of Loss obligation, and which the parties have foreseen or could have
Article 2199, NCC. Except as provided by law or by stipulation, one reasonably foreseen at the time the obligation was constituted
is entitled to an adequate compensation only for such pecuniary loss (2201[1]).
suffered by him as he has duly proved. Such compensation is o For example, in Mendoza v. Philippine Airlines, Inc., the Court
referred to as actual or compensatory damages. did not award to Mendoza the alleged profits which he
failed to realize when he was not able to exhibit the film
Requirement of proof during the town fiesta because PAL’s employees negligently
 Article 2199 provides that “except as provided by law or by failed to unload it from the plane when it arrived at the Naga
stipulation, one is entitled to an adequate compensation only for Airport and was consequently brought back to Manila. In this
such pecuniary loss suffered by him as he has duly proved.” case, PAL acted in good faith and without knowledge of
 There must be pleading and proof of actual damages suffered Mendoza’s plan to exhibit the film during the town fiesta.
for the same to be recovered.  On the other hand, in case of fraud, bad faith, malice, or wanton
o In addition to the fact that the amount of loss must be capable attitude, the obligor shall be responsible for all damages which may
of proof, it must also be actually proven with a reasonable be reasonably attributed to the non-performance of the obligation.
degree of certainty, premised upon competent proof or o To illustrate, in General Enterprises, Inc. v. Lianga Bay
the best evidence obtainable. Logging Company, Inc., Lianga entered into a contract with
 The burden of proof of the damage suffered is, consequently, General Enterprises, whereby the former, a producer of logs
imposed on the party claiming the same who should adduce the from a timber concession, designated the latter as distributor
best evidence available in support thereof, like sales and delivery of a portion of its log production to Korea and Europe on
receipts, cash and check vouchers, and other pieces of condition that it would pay the distributor a commission of 13%
documentary evidence of the same nature. of the gross f.o.b. value of the logs exported. In bad faith, the
o In the absence of corroborative evidence, it has been held former stopped its contract with the latter. As a consequence,
that self-serving statements of account are not sufficient the Court awarded General Enterprises commissions for
basis for an award of actual damages. transactions that would have transpired had the contract not
o Corollary to the principle that a claim for actual damages been unjustifiably terminated by Lianga.
cannot be predicated on flimsy, remote, speculative, and
insubstantial proof, courts are likewise required to state the In Crimes and Quasi-delicts
factual bases of the award. (Oceaneering) Article 2202, NCC. In crimes and quasi-delicts, the defendant shall
be liable for all damages which are the natural and probable
When Loss Cannot be Proved with Certainty consequences of the act or omission complained of. It is not
necessary that such damages have been foreseen or could have
reasonably been foreseen by the defendant.
Article 2204, NCC. In crimes, the damages to be adjudicated may that in the deceased’s line of work no documentary
be respectively increased or lessened according to the aggravating evidence is available; or
or mitigating circumstances. o (2) the deceased was employed as a daily worker earning
less than the minimum wage under current labor laws.
 In crimes and quasi-delicts, the defendants shall be liable for all  In Torreon u Aparra, however, the Court ruled that testimonial
damages which are the natural and probable consequences of evidence suffices to establish a basis for which the court can
the act or omission complained of. (2202) make a fair and reasonable estimate of the loss of earning
 It is not necessary that such damages have been foreseen or capacity. The employer and co-workers are deemed competent to
could have reasonably been foreseen by the defendant. testify on the compensation that the deceased was receiving before
 In crimes, the damages to be adjudicated may be respectively his death.
increased or lessened according to the aggravating
circumstances or mitigating circumstances. (2204) (3) Support –
Article 291, FC. X
Recoverable Damages When Death Occurs as a Result of Crime of
Quasi-delict Article 195, FC. X
Article 2206, NCC. The amount of damages for death caused by a
crime or quasi-delict shall be at least three thousand pesos, even Article 196, FC. X
though there may have been mitigating circumstances. In addition:
(1) The defendant shall be liable for the loss of the earning capacity If the deceased was obliged to give support according to the provisions
of the deceased, and the indemnity shall be paid to the heirs of of Article 291 (now Articles 195 and 196 FC), the recipient who is not
the latter; such indemnity shall in every case be assessed and an heir called to the decedent’s inheritance by the law of testate or
awarded by the court, unless the deceased on account of intestate succession, may demand support from the person
permanent physical disability not caused by the defendant, had causing the death, for a period not exceeding five years, the exact
no earning capacity at the time of his death; duration to be fixed by the court. (206[2])
(2) If the deceased was obliged to give support according to the
provisions of article 291, the recipient who is not an heir called (4) Moral damages
to the decedent’s inheritance by the law of testate or intestate  But only the spouse, legitimate and illegitimate descendants
succession, may demand support from the person causing the and ascendants of the deceased may demand moral damages
death, for a period not exceeding five years, the exact duration for mental anguish by reason of the death of the deceased
to be fixed by the court; (2206[3]).
(3) The spouse, legitimate and illegitimate descendants and o Brothers and sisters and other collateral blood relatives
ascendants of the deceased may demand moral damages for are not included among the persons entitled to recover moral
mental anguish by reason of the death of the deceased. damages for mental anguish by reason of the death of the
deceased.
 Article 2206 specifically applies when death occurs as a result of  The omission from Article 2206(3) of the brothers and sisters of the
a crime or a quasi-delict (Torreon v. Aparra). deceased reveals the legislative intent to exclude them from the
Under said article, the following damages may be recovered: recovery of such moral damages. (Sulpicio Lines v. Curso)
(1) Death indemnity  However, if the collateral blood relative is exercising substitute
Initially fixed by the CC at P3K, the amount of the indemnity is currently parental authority over the deceased, he or she is entitled to
fixed at P50K. This kind of civil indemnity is separate and distinct from recover moral damages for mental anguish by reason of the
other forms of indemnity for damages and is automatically awarded death of the deceased because he or she is to be considered as
without need of further proof other than the fact of death and the an ascendant for the purpose of awarding moral damages.
responsibility of the accused therefor. (People v. Catbangan)  Considering the policy underlying Articles 216 and 220 FC as well
(2) Loss of earning capacity – as the purposes for awarding moral damages, the Court has ruled
 The indemnity for the deceased’s lost earning capacity is meant to that a person exercising substitute parental authority is rightly
compensate the heirs for the income they would have received had considered an ascendant of the deceased, within the meaning of
the deceased continued to live (Torreon). Article 2206(3). (Caravan)
 Pleyto v. Lomboy provided the formula to compute a deceased’s
earning capacity: (5) Injury to Plaintiff’s Business Standing or Commercial Credit
o Net Earning Capacity = [2/3 x (80 - age at time of death) x Article 2205, NCC. Damages may be recovered:
(gross annual income – reasonable and necessary living (1) For loss or impairment of earning capacity in cases of temporary
expenses)]. or permanent personal injury;
 However, the formula provided by the Court is presumptive. It (2) For injury to the plaintiff’s business standing or commercial
should be applied in the absence of proof in terms of statistics credit.
and actuarial presented by the plaintiff.2
 But “damages for loss [or impairment] of earning capacity is in the  The financial credit of a businessman is a prized and valuable
nature of actual damages (Estrada). Thus, as a rule, documentary asset, it being a significant part of the foundation of his business.
evidence should be presented to substantiate the claim for Any adverse reflection thereon constitutes some material loss to
damages for loss of earning capacity. him. Hence, the same is compensable (Araneta v. Bank of
 By way of exception, damages for loss [or impairment] of America).
earning capacity may be awarded despite the absence of  In RCPI v. CA, compensatory damages were also awarded for
documentary evidence when injury to Yabut’s “business reputation or business standing,” “loss
o (1) the deceased [or the injured] was self-employed and of goodwill and loss of customers or shippers who shifted their
earning less than the minimum wage under current labor patronage to competitors.” The grant thereof is proper under the
laws, in which case, judicial notice may be taken of the fact provisions of Article 2205, which provides that damages may be
recovered "for injury to the plaintiff’s business standing or (b) quasi-delicts causing physical injuries;
commercial credit.” And even if not recoverable as compensatory (c) seduction, abduction, rape, or other lascivious acts;
damages, they may still be awarded in the concept of temperate or (d) adultery or concubinage;
moderate damages. (e) illegal or arbitrary detention or arrest;
 There are cases where from the nature of the case, definite proof (f) illegal search;
of pecuniary loss cannot be offered, although the court is convinced (g) libel, slander, or any other form of defamation;
that there has been such loss. For instance, injury to one’s (h) malicious prosecution;
commercial credit or to the goodwill of the business firm is often (i) acts mentioned in Article 309;
hard to show with certainty in terms of money. Should damages be (j) acts and actions referred to in Articles 21,26,27, 28, 29, 30,
denied for the reason? The judge should be empowered to 32, 34, and 35;21’
calculate moderate damages in such cases, rather than that the (k) willful injury to property may be a legal ground for awarding
plaintiff should suffer, without redress from the defendant’s moral damages if the court should find that, under
wrongful act. circumstances, such damages are justly due; and
(l) breaches of contract where the defendant acted fraudulently
2. Moral Damages or in bad faith.
(2) Recovery of Moral Damages in Breach of Contract
(a) Concept Since breach of contract is not one of the items enumerated under
 Moral damages are meant to compensate the claimant for any Articles 2219 and 2220, moral damages, as a general rule, are not
physical suffering, mental anguish, fright, serious anxiety, recoverable in actions for damages predicated on breach of contract
besmirched reputation, wounded feelings, moral shock, social (Estrada)
humiliation, and similar injuries unjustly caused.
 Moral damages are awarded to achieve a “spiritual status quo.” By way of exceptions, such damages are recoverable in an action for
These damages are awarded to enable the injured party to obtain breach of contract:
means, diversions, or amusements that will serve to alleviate  in cases in which the mishap results in the death of a passenger,
the moral suffering he/she has undergone, by reason of the as provided in Article 1764, in relation to Article 2206(3);
defendant’s culpable action (Samson v. BPI)  in cases in which the carrier is guilty of fraud or bad faith, as
provided in Article 2220; and
(b) Requisites For Grant of Moral Damages  in cases when the act of breach of contract itself is constitutive of
Article 2219, NCC. Moral damages may be recovered in the tort resulting in physical injuries or for the breach of contract which
following and analogous cases: was palpably wanton, reckless, malicious or in bad faith,
(1) A criminal offense resulting in physical injuries; oppressive, or abusive (Go v. CA), as it is also accepted in this
(2) Quasi-delicts causing physical injuries; jurisdiction that liability for a quasi-delict may still exist despite the
(3) Seduction, abduction, rape, or other lascivious acts; presence of contractual relations, that is, the act which violates the
(4) Adultery or concubinage; contract may also constitute a quasi-delict
(5) Illegal or arbitrary detention or arrest;
(6) Illegal search; (d) Right of Juridical Persons to Recover Moral Damages
(7) Libel, slander or any other form of defamation;  Rule: A juridical person, including the Republic of the Philippines
(8) Malicious prosecution; (Republic v. Tuvera), is generally not entitled to moral damages
(9) Acts mentioned in article 309; because, unlike a natural person, it cannot experience physical
(10) Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32, suffering or such sentiments as wounded feelings, serious anxiety,
34, and 35. mental anguish, or moral shock. (Crystal v. BPI)
The parents of the female seduced, abducted, raped, or abused, Exception: Article 2219, No. 7 expressly authorizes the recovery of
referred to in No. 3 of this article, may also recover moral damages. moral damages in cases of libel, slander, or any other form of
defamation. Article 2219(7) does not qualify whether the plaintiff is a
The spouse, descendants, ascendants, and brothers and sisters may natural or juridical person. Therefore, a juridical person such as a
bring the action mentioned in No. 9 of this article, in the order named. corporation can validly complain for libel or any other form of defamation
and claim for moral damages.
Article 2220, NCC. Willful injury to property may be a legal ground
for awarding moral damages if the court should find that, under the (e) Amount of Moral Damages
circumstances, such damages are justly due. The same rule applies There is no hard-and-fast rule in determining what would be a fair and
to breaches of contract where the defendant acted fraudulently or in reasonable amount of moral damages, since each case must be
bad faith. governed by its own peculiar facts. Trial courts are given discretion in
determining the amount, with the limitation that it should not be palpably
An award of moral damages would require: and scandalously excessive. Indeed, it must be commensurate to the
 evidence of besmirched reputation or physical, mental, or loss or injury suffered.228
psychological suffering sustained by the claimant;
 a culpable act or omission factually established; 3. Nominal Damages
 proof that the wrongful act or omission of the defendant is the
proximate cause of the damages sustained by the claimant; and (a) Concept
 that the case is predicated on any of the instances expressed or Article 2221, NCC. Nominal damages are adjudicated in order that
envisioned by Article 2219 and Article 2220. (PT&T v. CA) a right of the plaintiff, which has been violated or invaded by the
defendant, may be vindicated or recognized, and not for the purpose
(c) Instances Where Moral Damages May be Recovered of indemnifying the plaintiff for any loss suffered by him.
(1) Those Enumerated in Articles 2219 and 2220:
(a) criminal offense resulting in physical injuries;
 Nominal damages are given in order that a right of the plaintiff,

which has been violated or invaded by the defendant, may be (b) May Still be Awarded Even If Case is Susceptible to Proof of
vindicated or recognized, and not for the purpose of indemnifying Pecuniary Loss
the plaintiff for any loss suffered by him.  The textual language might betray an intent that temperate
 Thus, these kinds of damages are recoverable where a legal right damages do not avail when the case, by its nature, is susceptible
is technically violated and must be vindicated against an to proof of pecuniary loss. Still, jurisprudence applying Article 2224
invasion that has produced no actual present loss of any kind is clear that temperate damages may be awarded even in
or where there has been a breach of contract and no substantial instances where pecuniary loss could theoretically have been
injury or actual damages whatsoever have been or can be proved with certainty. (Republic v. Tuvera)
shown. (MCC Industrial Sales v. Ssangyong Corp.)  In a host of criminal cases, the Court has awarded temperate
damages to the heirs of the victim in cases where the amount
(b) Cannot Co-exist with Compensatory Damages of actual damages was not proven due to the inadequacy of
 Nominal damages cannot co-exist with compensatory damages the evidence presented by the prosecution. In Viron
(Northwest Airlines v. Cuenca). Transportation Co., Inc. v. Delos Santos, a civil action for damages
 Thus, if the court has already awarded compensatory and involving a vehicular collision, temperate damages were awarded
exemplary damages that are in themselves a judicial recognition for the resulting damage sustained by a cargo truck, after the
that plaintiff’s right was violated, the award of nominal damages is plaintiff had failed to submit competent proof of actual damages.
unnecessary and improper (Vda. De Medina).
(c) Amount of Temperate or Moderate Damages
(c) Nominal and Temperate (or Moderate) Damages Cannot be The amount of temperate or moderate damages is usually left to the
Awarded Concurrently discretion of the courts but the same should be reasonable, bearing
 It is wrong to award, along with nominal damages, temperate or in mind that temperate damages should be more than nominal but less
moderate damages. The two awards are incompatible and cannot than compensatory. (Dueñas)
be granted concurrently.
 Nominal damages are given in order that a right of the plaintiff, 5. Exemplary or Corrective Damages
which has been violated or invaded by the defendant, may be
vindicated or recognized, and not for the purpose of indemnifying (a) Concept
the plaintiff for any loss suffered by him (Art. 2221). (Citytrust Article 2229, NCC. Exemplary or corrective damages are imposed,
Banking v. IAC) by way of example or correction for the public good, in addition to the
 Temperate or moderate damages, which are more than nominal moral, temperate, liquidated or compensatory damages.
but less than compensatory damages, on the other hand, may be
recovered when the court finds that some pecuniary loss has been  Exemplary or corrective damages are imposed, by way of
suffered but its amount cannot, from the nature of the case, be example or correction for the public good, only in addition to
proved with reasonable certainty (Art. 2224). the moral, temperate, liquidated, or compensatory damages,
but they could not be recovered as a matter of right, their
(d) Amount of Nominal Damages determination depending upon the discretion of the court (Singson
The assessment of nominal damages is left to the discretion of the court, v. Aragon).
according to the circumstances of the case. (Ventanilla v. Centeno)  In essence, exemplary damages are designed by our civil law to
permit the courts to reshape behavior that is socially deleterious
4. Temperate or Moderate Damages in its consequence by creating negative incentives or
deterrents against such behavior (Trans-Asia Shipping Lines v.
(a) Concept CA).
Article 2224, NCC. Temperate or moderate damages, which are
more than nominal but less than compensatory damages, may be (b) When It Can be Awarded
recovered when the court finds that some pecuniary loss has been Pre-requisite
suffered but its amount can not, from the nature of the case, be Article 2234, NCC. While the amount of the exemplary damages
proved with certainty. need not be proved, the plaintiff must show that he is entitled to
moral, temperate or compensatory damages before the court may
 Temperate or moderate damages, which are more than nominal consider the question of whether or not exemplary damages should
but less than compensatory damages, avail when the court finds be awarded. In case liquidated damages have been agreed upon,
that some pecuniary loss has been suffered but its amount although no proof of loss is necessary in order that such liquidated
cannot from the nature of the case, be proved with certainty damages may be recovered, nevertheless, before the court may
(2224). consider the question of granting exemplary in addition to the
 The rationale behind temperate damages is precisely that from the liquidated damages, the plaintiff must show that he would be entitled
nature of the case, definite proof of pecuniary loss cannot be to moral, temperate or compensatory damages were it not for the
offered. stipulation for liquidated damages.
 When the court is convinced that there has been such loss, the
judge is empowered to calculate moderate damages, rather than  Before the court may consider an award for exemplary damages,
let the complainant suffer without redress from the defendant’s the plaintiff must first show that he is entitled to moral, temperate,
wrongful act. (GSIS v. Deang) or compensatory damages (2234); but it is not necessary that he
 To illustrate, the Court, in the past, has awarded temperate prove the monetary value thereof (Trans-Asia).
damages in lieu of actual damages for loss of earning capacity  In case liquidated damages have been agreed upon, although
where earning capacity is plainly established but no evidence was no proof is necessary in order that such liquidated damages may
presented to support the allegation of the injured party’s actual be recovered, nevertheless, before the court may consider the
income. question of granting exemplary in addition to the liquidated
damages, the plaintiff must show that he would be entitled to
moral, temperate, or compensatory damages were it not for (b) Liquidated Damages and Penalty
the stipulation for liquidated damages. Article 2226, NCC. Liquidated damages are those agreed upon by
the parties to a contract, to be paid in case of breach thereof.
Award is Nevertheless Discretionary
Article 2232, NCC. In contracts and quasi-contracts, the court may Article 2227, NCC. Liquidated damages, whether intended as an
award exemplary damages if the defendant acted in a wanton, indemnity or a penalty, shall be equitably reduced if they are
fraudulent, reckless, oppressive, or malevolent manner. iniquitous or unconscionable.
But exemplary damages cannot be recovered as a matter of right; the  There is no justification for the CC to make an apparent
court will decide whether or not they should be adjudicated (2232). In distinction between penalty and liquidated damages because
other words, its recovery is based entirely on the discretion of the court. the rule is that there is no difference between penalty and
(Kierulf v. CA) liquidated damages insofar as legal results are concerned and
that either may be recovered without the necessity of proving
What Cases May It be Awarded actual damages and both may be reduced when proper
Article 2231, NCC. In quasi-delicts, exemplary damages may be (Pamintuan v. CA).
granted if the defendant acted with gross negligence.  The SC in Laureano v. Kilayko instructed that a distinction between
a penalty clause imposed essentially as penalty in case of breach
Article 2230, NCC. In criminal offenses, exemplary damages as a and a penalty clause imposed as indemnity for damages should be
part of the civil liability may be imposed when the crime was made in cases where there has been neither partial nor irregular
committed with one or more aggravating circumstances. Such compliance with the terms of the contract.
damages are separate and distinct from fines and shall be paid to the  In cases where there has been partial or irregular compliance,
offended party. there will be no substantial difference between a penalty and
liquidated damages insofar as legal results are concerned.
 In Contracts and Quasi-contracts: Exemplary damages may be (Filinvest)
awarded if the defendant acted in a wanton, fraudulent, reckless,  The distinction is thus more apparent than real especially in the
oppressive, or malevolent manner. light of the provisions of Articles 2226 and 2227.
 In Quasi-delict: Exemplary damages may be granted if the
defendant acted with gross negligence. (2231) (c) Courts May Reduce If Iniquitous or Unconscionable
 In Criminal Offenses: Exemplary damages as a part of the civil Article 2227, NCC. Liquidated damages, whether intended as an
indemnity may be imposed when the crime was committed with one indemnity or a penalty, shall be equitably reduced if they are
or more aggravating circumstances. Such damages are separate iniquitous or unconscionable.
and distinct from fines and shall be paid to the offended party.
(2230)  Liquidated damages, whether intended as an indemnity or penalty,
shall be equitably reduced if they are iniquitous or
(c) Amount of Exemplary Damages unconscionable.
 The amount of exemplary damages need not be proven,  The reason is that in both cases, the stipulation is contra bonos
because its determination depends upon the amount of mores under Article 1306. It is a mere technicality to refuse to
compensatory damages that may be awarded to the claimant lessen the damages to their just amount simply because the
(Singson). stipulation is not meant to be a penalty.
 If the amount of exemplary damages need not be proven, it  An immoral stipulation is nonetheless immoral because it is
need not also be alleged, and the reason is obvious because it is called an indemnity. (Joe’s Radio v. Alto Electrical Supply)
merely incidental or dependent upon what the court may
award as compensatory damages. 7. Attorney’s Fees and Litigation Expenses
 Unless and until this premises is determined and established, what
may be claimed as exemplary damages would amount to a mere (a) Two concepts of Attorney’s Fees
surmise or speculation. Article 2208, NCC. In the absence of stipulation, attorney’s fees and
 It follows as a necessary consequence that the amount of expenses of litigation, other than judicial costs, cannot be recovered,
exemplary damages need not be pleaded it the complaint because except:
the same cannot be predetermined by the court. The grant, (1) When exemplary damages are awarded;
however, should be tempered, as it is not intended to enrich one (2) When the defendant’s act or omission has compelled the
party or to impoverish another. (Tan v. OMC Carriers, Inc.) plaintiff to litigate with third persons or to incur expenses to
protect his interest;
(d) Cannot be Renounced in Advance (3) In criminal cases of malicious prosecution against the plaintiff;
A stipulation whereby exemplary damages are renounced in advance (4) In case of a clearly unfounded civil action or proceeding against
shall be null and void.2” the plaintiff;
(5) Where the defendant acted in gross and evident bad faith in
6. Liquidated Damages refusing to satisfy the plaintiff’s plainly valid, just and
demandable claim;
(a) Concept (6) In actions for legal support;
Article 2235, NCC. A stipulation whereby exemplary damages are (7) In actions for the recovery of wages of household helpers,
renounced in advance shall be null and void. laborers and skilled workers;
(8) In actions for indemnity under workmen’s compensation and
Liquidated damages are those agreed upon by the parties to a contract, employer’s liability laws;
to be paid in case of breach thereof. (9) In a separate civil action to recover civil liability arising from a
crime;
(10) When at least double judicial costs are awarded;  in actions for indemnity under workmen’s compensation and
(11) In any other case where the court deems it just and equitable employer’s liability laws;
that attorney’s fees and expenses of litigation should be  in a separate civil action to recover civil liability arising from a crime;
recovered.  when at least double judicial costs are awarded;
 in any other case where the court deems it just and equitable that
In all cases, the attorney’s fees and expenses of litigation must be attorney’s fees and expenses of litigation should be recovered.
reasonable.
(c) Recoverable as Actual Damages
There are two commonly accepted concepts of attorney’s fees, the so-  Under Article 2208, attorney’s fees are recoverable only in the
called ordinary and extraordinary. concept of actual damages (Trans-Asia), not as moral damages nor
 In its ordinary concept, an attorney’s fee is the reasonable judicial costs.
compensation paid to a lawyer by his client for the legal  Hence, to merit such an award, the amount thereof must be
services he has rendered to the latter. proven. Moreover, such must be specifically prayed for and may
o The basis of this compensation is the fact of his employment not be deemed incorporated within a general prayer for “such
by and his agreement with the client (Traders Royal Bank other relief and remedy as this court may deem just and equitable.
Employees Union-Independent v. NLRC).
 In its extraordinary concept, an attorney’s fee is an indemnity for (d) Attorney’s Fees as Liquidated Damages
damages ordered by the court to be paid by the losing party in Article 2227, NCC. Liquidated damages, whether intended as an
a litigation. indemnity or a penalty, shall be equitably reduced if they are
o The basis of this is any of the cases provided by law where iniquitous or unconscionable.
such award can be made, such as those authorized in Article
2208, and is payable not to the lawyer but to the client,  Attorney’s fees as provided in penal clauses are in the nature
unless they have agreed that the award shall pertain to the of liquidated damages (First Metro Investment Corp. v. Este del
lawyer as additional compensation or as part thereof. Sol) and not the attorney’s fees recoverable as between attorney
and client enunciated and regulated by the ROC (Suatengco v.
(b) Attorney’s Fees as Item of Damages Reyes).
Nature  So long as such stipulation does not contravene any law,
In attorney’s fees as an item of damages under Article 2208, the award morals, or public order, it is binding upon the parties. The
is made in favor of the litigant, not of his counsel, and the litigant, not his attorneys’ fees so provided are awarded in favor of the litigant,
counsel, is the judgment creditor who may enforce the judgment for not his counsel. It is the litigant, not counsel, who is the judgment
attorney’s fees by execution. (Quirante v. IAC) creditor entitled to enforce the judgment by execution (Polytrade v.
Blanco).
Generally Not Recoverable  Nonetheless, courts are empowered to reduce the amount of
 Attorney’s fees which are granted as an item of damages are attorney’s fees if the same is “iniquitous or unconscionable”
generally not recoverable (GSIS v. Labung Deang) because of the pursuant to Articles 1229 and 2227. (First Metro)
policy that no premium should be placed on the right to litigate
(Firestone Tire v. Ines Chavez).
 The award thereof as an item of damages is the exception rather
than the rule, and counsel’s fees are not to be awarded every
time a party wins a suit.
 The power of the court to award attorney’s fees under Article 2208
demands factual, legal, and equitable justification, without
which the award is a conclusion without a premise, its basis
being improperly left to speculator and conjecture. In all events, the
court must explicitly state ill the text of the decision, and not only in
the decretal portioi thereof, the legal reason for the award of
attorney’s fees. (Filipinas Broadcasting Network v. Ago)
When recoverable
In the absence of stipulation, attorney’s fees and expenses of litigation,
other than judicial costs, cannot be recovered, except:
 when exemplary damages are awarded;
 when the defendant’s act or omission has compelled the plaintiff to
litigate with third persons or to incur expenses to protect his
interest;
 in criminal cases of malicious prosecution against the plaintiff;
 in case of a clearly unfounded civil action or proceeding against the
plaintiff;
 where the defendant acted in gross and evident bad faith in
refusing to satisfy the plaintiff’s plainly valid, just, and demandable
claim;
 in actions for legal support;
 in actions for the recovery of wages of household helpers, laborers,
and skilled workers;
BOOK 7: LAND TITLES AND DEEDS (b) lands of the public domain, or the public lands as provided by the
Constitution, but with the limitation that the lands must only be
A. Classification of Lands agricultural.
1. Classification Based on Ownership  Consequently, lands classified as forest or timber, mineral, or

national parks are not susceptible of alienation or disposition
Article X, NCC. X unless they are reclassified as agricultural.
o A positive act of the Government is necessary to enable
Land, which is an immovable property, may be classified as either of such reclassification, and the exclusive prerogative to
public dominion or of private ownership. classify public lands under existing laws is vested in the
Executive Department, not in the courts.
Land is considered of public dominion if it either: o If, however, public land will be classified as neither
(a) is intended for public use; or agricultural, forest or timber, mineral, or national park, or
(b) belongs to the State, without being for public use, and is intended when public land is no longer intended for public service
for some public service or for the development of the national or for the development of the national wealth, thereby
wealth. (Heirs of Malabanan v. Republic) effectively removing the land from the ambit of public
dominion, a declaration of such conversion must be made
Land that belongs to the State but which is not or is no longer intended in the form of a law duly enacted by Congress or by a
for public use, for some public service, or for the development of the Presidential proclamation in cases where the President is
national wealth, is patrimonial property; it is property owned by the duly authorized by law to that effect.
State in its private capacity. Provinces, cities, and municipalities may o Thus, until the Executive Department exercises its prerogative
also hold patrimonial lands. (Heirs of Delfin v. NHA) to classify or reclassify lands, or until Congress or the
President declares that the State no longer intends the land to
The CC classifies property of private ownership into three categories: be used for public service or for the development of national
(1) patrimonial property of the State under Articles 421 and 422; wealth, the Regalian Doctrine is applicable. (Malabanan)
(2) patrimonial property of LGUs under Article 424; and
(3) property belonging to private individuals under Article 425. 4. Classification of Public Lands
(Republic v. Alejandre)
 Classification of lands of the public domain may be found under
Stated otherwise, private properly consists of all property belonging Article Xll of the 1987 Philippine Constitution.
to private persons, either individually or collectively, as well as the  More specifically, Section 3 of Article XII classifies lands of the
patrimonial property of the State, provinces, cities, and public domain into
municipalities. (Delfin) (1) agricultural,
(2) forest or timber,
2. Classification of Public Lands According to Alienability (3) mineral, and
(4) national parks.
 Whether or not land of the public domain is alienable and
disposable primarily rests on the classification of public lands  Of these four classifications, only agricultural lands may be
made under the Constitution. alienated and disposed of by the State (Dumo v. Republic).
 Under the 1935 Constitution, lands of the public domain were  The 1987 Constitution also provides that “agricultural lands of the
classified into three, namely, agricultural, timber, and mineral. public domain may be further classified by law according to
 Section 10, Article XIV of the 1973 Constitution classified lands of the uses to which they may be devoted.”
the public domain into seven, specifically, agricultural, industrial or o the classification of lands of the public domain is first and
commercial, residential, resettlement, mineral, timber or forest, and foremost provided by the Constitution itself.
grazing land, with the reservation that the law might provide other o Of the classifications of lands of the public domain,
classifications. agricultural lands may further be classified by law,
 The 1987 Constitution adopted the classification under the 1935 according to the uses it may be devoted to. (Dumo)
Constitution into agricultural, forest or timber, and mineral, but  The classification of lands of the public domain into agricultural
added national parks. lands, as well as their further classification into alienable and
o Agricultural lands may be further classified by law according disposable lands of the public domain, is a legislative prerogative
to the uses to which they may be devoted. which may be exercised only through the enactment of a valid
o The identification of lands according to their legal law.
classification is done exclusively by and through a positive act o This prerogative has long been exercised by the legislative
of the Executive Department (Malabanan). department through the enactment of CA 141 or the Public
 Based on the foregoing, the Constitution places a limit on the Land Act of 1936 (PLA).
type of public land that may be alienated. o Section 6 of CA 141 remains to this day the existing general
o Under Section 2, Article XII of the 1987 Constitution, only law governing the classification of lands of the public domain
agricultural lands of the public domain may be alienated; into alienable and disposable lands of the public domain.
all other natural resources may not be. o Under the 1987 Philippine Constitution, the power to classify
agricultural lands of the public domain into alienable and
3. Concept of Alienable and Disposable Lands of the State disposable lands of the public domain is exercised “by
law” or through legislative enactment.
Alienable and disposable lands of the State fall into two categories: o In accordance with Section 6 of CA 141, this power is
(a) patrimonial lands of the State, or those classified as lands of delegated to the President who may, based on his sound
private ownership under Article 425, without limitation; and discretion, classify agricultural lands as alienable and
disposable lands of the public domain.
o This delegated power to so classify public agricultural for the development of the national wealth that the period of
lands may no longer be redelegated by the President— acquisitive prescription can begin to run.
what has once been delegated may no longer be delegated to  Such declaration shall be in the form of a law duly enacted by
another. Congress or a Presidential Proclamation in cases where the
o Likewise, the same discretionary power has been President is duly authorized by law.
delegated “by law” to the DENR Secretary who, of course,
cannot redelegate the same to his subordinates. B. Modes of Disposition of Public Agricultural Lands
 As it is only the President or the DENR Secretary who may classify
as alienable and disposable the lands of the public domain, an 1. Modes of Disposition
applicant for land registration must prove that the land sought
to be registered has been declared by the President or DENR Entitlement to agricultural lands of the public domain requires
Secretary as alienable and disposable land of the public compliance with the provisions of CA 141 (PLA)
domain.
There are four modes of disposition of agricultural lands under
5. Agricultural Lands Section 11 of the Public Land Act, namely:
(1) for homestead settlement;
(a) Concept (2) by sale;
 Agricultural public lands may be defined as those alienable (3) by lease; or
portions of the lands of the public domain which are not forest (4) by confirmation of imperfect or incomplete titles. (Taar v. Lawan)
or timber, mineral (Republic v. De Porkan), or national parks (Sec.
3, Article XII, Consti.). (a) Homestead
 Their disposition is provided for under CA 141 (Sections 6-7), which  The applicant of a homestead must be a “citizen of the
states that it is only the President, upon the recommendation of the Philippines over the age of eighteen years, or the head of a
proper department head, who has the authority to classify the lands family.”
of the public domain into alienable or disposable, timber, and  The applicant must prove compliance with the residency and
mineral lands. cultivation requirements under Chapter IV of the Public Land Act.
 The classification of public lands is an exclusive prerogative o Under the Constitution, only 12 hectares of agricultural
of the Executive Department of the Government and not of the land of the public domain may be acquired through
courts (Director of Lands v. CA). homestead.
o In the absence of such classification, the land remains as  Any application for a homestead settlement recognizes that the
unclassified land until it is released therefrom and rendered land belongs to the public domain.
open to disposition.  Prior to its disposition, the public land has to be classified first
o This is in consonance with the Regalian doctrine that all lands as alienable and disposable through a positive act of the
of the public domain belong to the State, and that the State is government (Republic v. Daquer).
the source of any asserted right to ownership in land and o Only lands of the public domain which have been classified as
charged with the conservation of such patrimony. public agricultural lands may be disposed of through
o As such, all lands not appearing to be clearly within private homestead settlement.
ownership are presumed to belong to the State. Unless public  The rule that a certificate of title issued pursuant to a homestead
land is shown to have been reclassified or alienated to a patent becomes indefeasible after one year, is subject to the
private person by the State, it remains part of the inalienable proviso that the land covered by said certificate is a disposable
public domain. To overcome this presumption, public land within the contemplation of the Public Land Law.
incontrovertible evidence must be established that the land o When the property covered by a homestead patent is part of
subject of the application is alienable or disposable. (Republic the inalienable land of the public domain, the title issued
v. Lao) pursuant to it is null and void, and the rule on indefeasibility
of title will not apply.
(b) When Agricultural Lands of Public Domain Become
Patrimonial Property (b) Sales Patent
 The fact that agricultural lands of the public domain have been  Sales patents are governed by Chapter V of the Public Land Act.
declared alienable and disposable does not automatically The applicant must be a citizen of the Philippines who is of legal
convert them to patrimonial property of the State. age or a head of the family. The land must first be appraised
 In Heirs of Malabanan v. Republic, the Court categorically ruled that before it can be sold through public bidding.
“for as long as the property belongs to the State, although already  As an additional requirement, the purchaser must “have not less
classified as alienable or disposable, it remains property of the than one-fifth of the land broken and cultivated within five
public dominion if when it is intended for some public service or for years after the date of the award.”
the development of the national wealth.”  The purchaser must also show “actual occupancy, cultivation,
 Hence, in order to convert agricultural lands already declared and improvement of at least one-fifth of the land applied for until
alienable and disposable into patrimonial property, there must be the date on which final payment is made” before the issuance of a
an express declaration by the State that the public dominion sales patent.
property is no longer intended for public service or the  Only 12 hectares of agricultural land of the public domain may
development of the national wealth or that the property has be acquired through a sales patent.
been converted into patrimonial. Without such express  The Public Land Act authorized domestic corporations to apply for
declaration, the property, even if classified as alienable or sales patents over agricultural lands.
disposable, remains property of the public dominion, pursuant to o However, under the present Constitution, private corporations
Article 420(2), and thus incapable of acquisition by prescription. It and associations can only lease agricultural lands. (Taar)
is only when such alienable and disposable lands are expressly
declared by the State to be no longer intended for public service or (c) Lease
 The third mode of disposition of agricultural lands of the public  On the other hand, Chapter VII (Sections 44-46) of the PLA
domain is through a lease. substantively governs administrative legalization through the
 The government can only award the right to lease through an grant of free patents, as amended by RA 782. Under paragraph
auction, the procedure of which shall be the same as that 1, Section 44, Chapter VII CA 141, as amended by RA 782, the
prescribed for sales patents. free patent applicant:
 An inherent condition of the lease is that the lessee should have o has to be a natural born citizen of the Philippines who is
cultivated 1/3 of the land “within five years after the date of the not the owner of more than 24 hectares; and
approval of the lease.” o since 4 July 1945 or prior thereto, has continuously
 Under the Constitution, citizens may lease not more than 500 occupied and cultivated, whether by himself or his
hectares of agricultural lands of the public domain. predecessor-in-interest, a tract of or tracts of public
o For private corporations and associations, they may lease agricultural lands subject to disposition not exceeding 24
a maximum of 1,000 hectares of agricultural lands for a hectares.
period of 25 years, renewable for another 25 years.  Moreover, the application must be accompanied by a map and
the technical description of the land occupied, along with
(d) Confirmation of Imperfect or Incomplete Title affidavits proving his occupancy from two disinterested
 The last mode of disposition is by confirmation of imperfect or persons residing in the municipality or barrio where the land may
incomplete titles either through judicial legalization or through be located (Republic v. Lasmarias).
administrative legalization.  Unlike an applicant in judicial confirmation of title who claims
 The second sub-category refers to the grant of free patents. ownership over the land, the applicant for a free patent
 Under Section 11 PLA, there are two modes of disposing public recognizes that the land applied for belongs to the
lands through confirmation of imperfect or incomplete titles: government.
o by judicial confirmation; and  A patent, by its very definition, is a governmental grant of a right, a
o by administrative legalization, otherwise known as the grant privilege, or authority.
of free patents. (De Leon v. De Leon-Reyes0 o A free patent is an instrument by which the government
conveys a grant of public land to a private person (De Leon v.
2. Confirmation of Imperfect Title De Leon-Reyes). Thus, the filing of a free patent application
amounts to an admission that the land is a public land, and
(a) Judicial Confirmation thus, he could not be the rightful owner of the same. (Yabut v.
 The substantive provisions governing judicial confirmation are Alcantara)
found in Chapter VIII (Sections 47-57) of the PLA while its
procedural aspect is governed by Chapter III (Sections 14-38) of 3. Judicial Confirmation of Imperfect Title
the Property Registration Decree.
 Section 48 PLA particularly specifies who are entitled to judicial (a) Basis of Right
confirmation or completion of imperfect titles: “(b) Those who by  Section 11 of the Public Land Act acknowledges that public lands
themselves or through their predecessors-in-interest have been in suitable for agricultural purposes may be disposed of “by
open, continuous, exclusive, and notorious possession and, confirmation of imperfect or incomplete titles” through “judicial
occupation of agricultural lands of the public domain, under a bona legalization.”
fide claim of acquisition or ownership, since June 12, 1945,  Section 48(b) of the Public Land Act, as amended by P.D. No.
immediately preceding the filing of the application for confirmation 1073, supplies the details and unmistakably grants that right,
of title, except when prevented by war or force majeure. Those shall subject to the requisites stated therein (Malabanan): "Sec. 48. The
be conclusively presumed to have performed all the conditions following described citizens of the Philippines, occupying lands of
essential to a government grant and shall be entitled to a certificate the public domain or claiming to own any such land or an interest
of title under the provisions of this chapter." therein, but whose titles have not been perfected or completed,
o MEMAID: OCEN + PO + bona fide claim of acquisition or may apply to the Court of First Instance of the province where the
ownership since June 12, 1945 land is located for confirmation of their claims and the issuance of
 Upon compliance with the conditions of Sec. 48(b) of the PLA, the a certificate of title therefor, under the Land Registration Act, to wit:
possessor is deemed to have acquired, by operation of law, a xxx (b) Those who by themselves or through their predecessors in
right to a grant over the land. interest have been in open, continuous, exclusive, and notorious
 For all legal intents and purposes, the land is segregated from the possession and occupation of alienable and disposable lands of
public domain, because the beneficiary is conclusively presumed the public domain, under a bona fide claim of acquisition of
to have performed all the conditions essential to a Government ownership, since June 12,1945, or earlier, immediately preceding
grant. the filing of the application for confirmation of title except when
 The land becomes private in character and is now beyond the prevented by war or force majeure. Those shall be conclusively
authority of the director of lands to dispose of. presumed to have performed all the conditions essential to a
o At that point, original registration of the title, via judicial Government grant and shall be entitled to a certificate of title under
proceedings, takes place as a matter of course; the the provisions of this chapter. "
registration court does not grant the applicant title over the  Section 48(b) of CA 141 is virtually the same as Section 14(1) of
property but merely recognizes the applicant’s existing the Property Registration Decree.
title which had already vested upon the applicant’s o Said Decree codified the various laws relative to the
compliance with the requirement of open, continuous, registration of property, including lands of the public domain.
exclusive, and notorious possession and occupation of the o It is Section 14(1) that operationalizes the registration of
land since June 12, 1945. such lands of the public domain.
o The provision reads: "SECTION 14. Who may apply.— The
(b) Administrative Confirmation following persons may file in the proper Court of First Instance
an application for registration of title to land, whether
personally or through their duly authorized representatives:
(1) those who by themselves or through their predecessors-  In addition, the applicant for land registration must present a copy
ininterest have been in open, continuous, exclusive and of the original classification approved by the DENR Secretary
notorious possession and occupation of alienable and and certified as a true copy by the legal custodian of the official
disposable lands of the public domain under a bona fide claim records.
of ownership since June 12, 1945, or earlier, xxx" o These facts must be established to prove that the land is
alienable and disposable. (Rep. v. TAN Properties)
(b) Requisites for Registration Under Sec. 14(1) PRD (Judicial  In Republic v. T.A.N. Properties, Inc., the Court held that there are
Confirmation of Imperfect or Incomplete Title) two documents which must be presented to prove that the land
An application for registration under Section 14(1) of the Property subject of the application for registration is alienable and
Registration Decree (PD 1529) must establish the following requisites, disposable:
namely: o a copy of the original classification approved by the DENR
(1) the land is alienable and disposable property of the public Secretary and certified as a true copy by the legal custodian
domain; of the official records, and
(2) the applicant and its predecessors-in-interest have been in open, o a certificate of land classification status issued by the CENRO
continuous, exclusive, and notorious possession and or the PENRO based on the land classification approved by
occupation of the land under a bona fide claim of ownership the DENR Secretary. (DM Consunji v. Republic)
(3) the applicant and its predecessors-in-interest have possessed and
occupied the land since June 12,1945, or earlier. (Rep. v. 4. Registration under Sec. 14(2) PRD
Alonso)
(a) Requisites for registration
 This mode of disposition is referred to as judicial confirmation of Registration under Section 14(2) requires the applicant to establish the
imperfect or incomplete title under Section 48(b) of the Public following requisites:
Land Act. (1) the land is an alienable and disposable, and patrimonial property
 Here, the agricultural land subject of the application needs only to of the public domain;
be classified as alienable and disposable as of the time of the (2) the applicant and its predecessors-in-interest have been in
application, provided the applicant’s possession and occupation of possession of the land
the land dated back to June 12, 1945, or earlier. (a) for at least 10 years, in good faith and with just title, or
 Thereby, a conclusive presumption that the applicant has (b) for at least 30 years, regardless of good faith or just title;
performed all the conditions essential to a government grant (3) the land had already been converted to or declared as
arises, and the applicant becomes the owner of the land by virtue patrimonial property of the State at the beginning of the said 10-
of an imperfect or incomplete title. year or 30-year period of possession. (Rep. v. Bautista)
 By legal fiction, the land has already ceased to be part of the
public domain and has become private property (Malabanan). How to Prove Patrimonial Character
 When a person applies for judicial confirmation of title, he or she When property of public dominion is no longer intended for public use or
already holds an incomplete or imperfect title over the property for public service, it becomes part of the patrimonial property of the
being applied for, after having been in open, continuous, exclusive, State. When this happens, the property is withdrawn from public
and notorious possession and occupation from June 12, 1945 or dominion and becomes property of private ownership, albeit still owned
earlier. by the State. The property is now brought within the commerce of man
 “June 12, 1945” is the reckoning date of the applicant’s possession and becomes susceptible to the concepts of legal possession and
and occupation, and not the reckoning date of when the property prescription. (Republic v. Tan)
was classified as alienable and disposable. (Rep. v. Noval)
 The Court has resolved the issue on the correct interpretation of To establish that the land subject of the application has been converted
Section 14(1) of PD 1529 in Republic v. CA and Corazon Naguit" into patrimonial property of the State, an applicant must prove the
(Naguit case) where it was held that “the more reasonable following:
interpretation of Section 14(1) is that it merely requires the (1) the subject property has been classified as agricultural land;
property sought to be registered as already alienable and (2) the property has been declared alienable and disposable;
disposable at the time the application for registration of title is (3) there is an express government declaration or manifestation
filed.” In the en banc case of Heirs of Malabanan v. Republic" the that the property is already patrimonial, or is no longer retained
Court affirmed the earlier pronouncement in Naguit, for public service or the development of national wealth (Rep. v.
Nicolas); and
(c) Proof of Alienability (4) such declaration shall be in the form of a law duly enacted by
 As to the requirement of proof of alienability, jurisprudence is Congress or a Presidential Proclamation in cases where the
replete with cases which emphasize that a positive act of the President is duly authorized by law (Malabanan).
Executive Department, specifically certifications from the It must be emphasized that without the concurrence of these conditions,
Community Environment and Natural Resources Office the land remains part of public dominion and thus incapable of
(CENRO) or Provincial Environment and Natural Resources acquisition by prescription (Rep. v. Nicolas).
Office (PENRO), and the DENR Secretary, is indispensable for
the determination of the nature of land as alienable and disposable. Declaration of Alienability Not Sufficient
 It is not enough for the PENRO or CENRO to certify that a land  As regards the first and most important requisite mentioned above,
is alienable and disposable. the Court has clarified that declaration of alienability and
o The applicant for land registration must prove that the DENR disposability is not enough for the registration of land under Section
Secretary had approved the land classification and 14(2) of PD 1529 (Espiritu v. Rep).
released the land of the public domain as alienable and  For land of the public domain to be converted into patrimonial
disposable, and that the land subject of the application for property, there must be an express declaration—in the form of a
registration falls within the approved area per verification law duly enacted by Congress or a Presidential Proclamation in
through survey by the PENRO or CENRO. cases where the President is duly authorized by law—that "the
public dominion property is no longer intended for public service or C. Indefeasibility of Title
the development of the national wealth or that the property has
been converted into patrimonial. (Heirs of Delfin v. NHA)” 1. Principle of Indefeasibility of Title
 Accordingly, although lands of the public domain that are
considered patrimonial may be acquired by prescription under (a) Statement of principle
Section 14(2) of PD 1529, before acquisitive prescription could  Under the Land Registration Act, title to the property covered by
commence, the property sought to be registered must not only be a Torrens certificate becomes indefeasible after expiration of
classified as alienable and disposable; it must also be declared one year from the entry of the decree of registration.
by the State that it is no longer intended for public use, public o Such a decree of registration is incontrovertible and
service or the development of the national wealth. becomes binding on all persons whether or not they were
o Thus, absent an express declaration by the State, the land notified of, or participated in, the in rem registration process
remains to be property of public dominion (Republic v. (Heirs of Santiago v. Heirs of Sasntiago)
Cortez).  Pursuant to Section 32 PD 1529, a decree of registration may be
o For acquisitive prescription to set in, therefore, the land being reopened or subjected to review within one year from the date
possessed and occupied must already be classified or of the entry of such decree of registration if a party is deprived
declared as patrimonial property of the State. Otherwise, no of his interest in the land by reason of actual fraud.
length of possession would vest any right in the possessor if  Unlike ordinary civil actions, however, the adjudication of land in
the property has remained land of the public dominion. a cadastral or land registration proceeding does not become
 Malabanan stresses that even if the land is later converted to final, in the sense of incontrovertibility until after the
patrimonial property of the State, possession of it prior to expiration of one year from the entry of the final decree of
such conversion will not be counted to meet the requisites of registration.
acquisitive prescription. o As long as a final decree has not yet been entered by the
o Thus, registration under Section 14(2) of PD 1529 requires LRA and the period of one year has not elapsed from date
that the land had already been converted to patrimonial of entry, the title is not finally adjudicated and the decision in
property of the State at the onset of the period of the registration proceeding continues to be under the control
possession required by the law on prescription (Rep. v. and sound discretion of the court rendering it (Francisco v.
Zurbaran). Rojas).
 Stated otherwise, the period of acquisitive prescription would o Upon the expiration of said period of one year, the decree of
only begin to run from the time that the State officially declares registration and the certificate of title issued shall become
that the public dominion property is no longer intended for incontrovertible.
public use, public service, or for the development of national
wealth. (Rep. v. Heirs of Sps. Estacio and Ocol) (b) Only Actual or Extrinsic Fraud as Ground for Review
 This is only logical because acquisitive prescription could only run  Only actual and extrinsic fraud has been accepted and is
against private properties, which include patrimonial properties of contemplated by the law as a ground to review or reopen a decree
the State, but never against public properties. (Espiritu v. Republic) of registration (Republic v. Guerrero).
 Fraud is extrinsic if it is employed to deprive parties of their day
(b) Distinctions Between Sec. 14(1) and Sec. 14(2). PRD in court and thus prevent them from asserting their right to the
14(1) 14(2) property registered in the name of the applicant.
Registration under Section 14(1) is registration under Section o Thus, relief is granted to a party deprived of his interest in land
based on possession. 14(2) is based on where the fraud consists in a deliberate misrepresentation that
prescription. the lots are not contested when in fact they are; or in willfully
registration under Section 14(1) PD misrepresenting that there are no other claims; or in
1529 is based on possession and registration under Section deliberately failing to notify the party entitled to notice; or in
occupation of the alienable and 14(2) PD 1529 is based on inducing him not to oppose an application; or in
disposable land of the public domain acquisitive prescription and misrepresenting about the identity of the lot to the true owner
since June 12, 1945 or earlier, without must comply with the law by the applicant causing the former to withdraw his
regard to whether the land was on prescription as provided application.
susceptible to private ownership at by the CC. o In all these examples, the overriding consideration is that the
that time fraudulent scheme of the prevailing litigant prevented a party
Registration under the first mode is under the second mode is from having his day in court or from presenting his case.
extended under the aegis of the P.D. made available both by PD o The fraud, therefore, is one that afreets and goes into the
No. 1529 and the PLA 1529 and the CC jurisdiction of the court.
the land subject matter of the the land used to be  On the other hand, relief on the ground of fraud will not be granted
application for registration used to be patrimonial property of the where the alleged fraud goes into the merits of the case, is
agricultural land of the public domain State intrinsic and not collateral, and has been controverted and
but already declared alienable and decided.
disposable o Thus, the Court has underscored the denial of relief where it
not necessary for the land applied for the alienable and appears that the fraud consisted in the presentation at the trial
to be alienable and disposable at the disposable character of the of a supposed forged document, or a false and perjured
beginning of the possession on or land, as well as its testimony; or in basing the judgment on a fraudulent
before June 12, 1945—Section 14(1) declaration as patrimonial compromise agreement; or in the alleged fraudulent acts or
only requires that the property sought property of the State, must omission of the counsel which prevented the petitioner from
to be registered is alienable and exist at the beginning of the properly presenting the case. (Libudan v. Gil)
disposable at the time of the filing of relevant period of
the application for registration. possession (c) Counting of One-Year Period in Public Land Patent
 There is no specific provision in the Public Land Law or the for quieting of title, an action that is imprescriptible
Land Registration Act (Act No. 496), now PD 1529, fixing a (Uy v. CA).
similar one-year period within which a public land patent can  Thus, when the action for reconveyance is based on an implied or
be considered open to review on the ground of actual fraud (such constructive trust, the prescriptive period is 10 years, or it is
as that provided for in Section 38 of the Land Registration Act, and imprescriptible if the movant is in the actual, continuous, and
now Section 32 of PD 1529), and clothing a public land patent peaceful possession of the property involved.76
certificate of title with indefeasibility. o On the other hand, when the action for reconveyance is
 Nevertheless, the Court has repeatedly applied Section 32 of PD based on a void deed or contract the action is
1529 to a patent issued by the Director of Lands, approved by the imprescriptible under Article 1410 CC.
Secretary of Natural Resources, under the signature of the o As long as the land wrongfully registered under the Torrens
President. The date of the issuance of the patent corresponds system is still in the name of the person who caused such
to the date of the issuance of the decree in ordinary cases. Just registration, an action in personam will lie to compel him to
as the decree finally awards the land applied for registration to the reconvey the property to the real owner.
party entitled to it, the patent issued by the Director of Lands
equally and finally grants and conveys the land applied for to (g) Where there are two conflicting titles
the applicant (Heirs of Santiago). Thus, in the case of public land GR: in case of two certificates of title purporting to include the same
grants or patents, the one-year period commences from the land, the earlier date prevails. (Legarda v. Saleeby)
issuance of the patent by the government. (Rep. v. Guerrero)
EXC: the rule on superiority is not absolute. If the inclusion of the land
(d) When One (1)-Year Period Not Applicable in the earlier registered title was a result of a mistake, then the latter
 The one-year prescriptive period, however, does not apply when registered title will prevail.
the person seeking annulment of title or reconveyance is in  The ratio decidendi of this exception is to prevent a title that was
possession of the lot. This is because the action partakes of a earlier registered, which erroneously contained a parcel of
suit to quiet title which is imprescriptible (Heirs of Santiago). land that should not have been included, from defeating a title
 In David v. Malay, the Court held that a person in actual possession that was later registered but is legitimately entitled to the said land
of a piece of land under claim of ownership may wait until his (Yu Hwa Ping).
possession is disturbed or his title is attacked before taking steps
to vindicate his right, and his undisturbed possession gives him the 2. Action for Compensation against the Assurance Fund
continuing right to seek the aid of a court of equity to ascertain and
determine the nature of the adverse claim of a third party and its (a) Nature and purpose of fund
effect on his title.  It is intended to safeguard the rights of prejudiced parties
rightfully entitled to an interest in land but shut off from obtaining
(e) Petition For Review Within One (1) Year Not Exclusive Remedy titles thereto because of the indefeasibility of a Torrens title.
 While Section 38 of Act No. 496 states that the petition for review  Therefore, as suppletory to the registration of titles, pecuniary
to question a decree of registration must be filed within one year compensation by way of damages was provided for in certain cases
after entry of the decree, such provision is not the only remedy for persons who had lost their property. For this purpose, an
of an aggrieved party who was deprived of land by fraudulent assurance fund was created (Estrellado v. Martinez).
means.  The Assurance Fund was meant as a form of State insurance that
 The remedy of the landowner whose property has been wrongfully allows recompense to an original title holder who, without any
or erroneously registered in another’s name is, after one year from negligence on his part whatsoever, had been apparently deprived
the date of the decree, not to set aside the decree, but, respecting of his land initially by a usurper.
the decree as incontrovertible and no longer open to review, to  The ordinary remedies against the usurper would have allowed the
bring an ordinary action in the ordinary court of justice for original title holder to recover his property. However, if the usurper
reconveyance or, if the property has passed into the hands of an is able to transfer the same to an innocent purchaser for value and
innocent purchaser for value, for damages. (Yu Hwa Ping v. Ayala he is unable to compensate the original title holder for the loss, then
Land, Inc.) the latter is now left without proper recourse (Stilianopoulos v. RD
for Legazpi).
(f) Action For Reconveyance  The intent of the Assurance Fund is to indemnify the innocent
 The law creates the obligation of the trustee to reconvey the original title holder for his property loss, which loss is attributable
property and its title in favor of the true owner. to not only the acts of a usurper but ultimately the operation of the
 Correlating Section 53, paragraph 3 of P.D. No. 1529 and Article Torrens System of registration which, by reasons of public policy,
1456 CC with Article 1144(2) CC, the prescriptive period for the tilts the scales in favor of innocent purchasers for value.
reconveyance of fraudulently registered real property is 10
years reckoned from the date of the issuance of the certificate (b) When Recovery Against the Fund Proper
of title.  An action against the Assurance Fund on the ground of “fraudulent
o This 10-year prescriptive period begins to run from the date registration under the Torrens system after the land’s original
the adverse party repudiates the implied trust, which registration” may be brought only after the claimant’s property is
repudiation takes place when the adverse party registers the registered in the name of an innocent purchaser for value.
land. o This is because it is only after the registration of the innocent
o An exception to this rule is when the party seeking purchaser for value’s title (and not the usurper’s title which
reconveyance based on implied or constructive trust is in constitutes a breach of trust) can it be said that the claimant
actual, continuous, and peaceful possession of the effectively “sustains loss or damage, or is deprived of land or
property involved. any estate or interest therein in consequence of the bringing
 Prescription does not commence to run against him of the land under the operation of the Torrens system."
because the action would be in the nature of a suit
o The registration of the innocent purchaser for value’s title is o This rule is provided under Section 48 PD 1529 which states
therefore a condition sine qua non in order to properly claim that a certificate of title shall not be subject to collateral attack
against the Assurance Fund. and cannot be altered, modified, or canceled except in a direct
 In addition, Section 101 of P.D. No. 1529 explicitly provides that proceeding.
“the Assurance Fund shall not be liable for any loss, damage or  The issue as to whether title was procured by falsification or fraud
deprivation caused or occasioned by a breach of trust, whether can only be raised in an action expressly instituted for the purpose.
express, implied or constructive or by any mistake in the resurvey o A Torrens title can be attacked only for fraud, within one year
or subdivision of registered land resulting in the expansion of area after the date of the issuance of the decree of registration.
in the certificate of title.” o Such attack must be direct, and not by a collateral proceeding.
 It is hornbook doctrine that when a party uses fraud or concealment  The title represented by the certificate cannot be changed, altered,
to obtain a certificate of title of property, a constructive trust is modified, enlarged, or diminished in a collateral proceeding
created in favor of the defrauded party. However, as stated in (Lagrosa v. CA)
Section 101 PD 1529, the inability to recover from the  An application for registration of an already titled land constitutes a
defrauding party does not make the Assurance Fund liable collateral attack on the existing title. The title may be challenged
therefor. only in a proceeding for that purpose, not in an application for
 Instead, the loss, damage, or deprivation becomes registration of a land already registered in the name of another
compensable under the Assurance Fund when the property person. After one year from its registration, the title is
has been further registered in the name of an innocent incontrovertible and is no longer open to review. (Carvajal v. CA)
purchaser for value. This is because in this instance, the loss,
damage, or deprivation are not actually caused by any breach of (b) Direct and Collateral Attack
trust but rather, by the operation of the Torrens system of  An action is an attack on a title when the object of the action is to
registration which renders indefeasible the title of the innocent nullify the title, and thus challenge the judgment or proceeding
purchaser for value. pursuant to which the title was decreed.
 The attack is direct when the object of an action is to annul or set
(c) Prescriptive Period of Action for Compensation Against the aside such judgment, or enjoin its enforcement. On the other hand,
Fund the attack is indirect or collateral when, in an action to obtain a
 Section 102 PD 1529 sets a six-year prescriptive period “from different relief, an attack on the judgment or proceeding is
the time the right to bring such action first occurred” within nevertheless made as an incident thereof. (Heirs of Santiago)
which one may proceed to file an action for compensation against
the Assurance Fund. 2. Action for Reconveyance, Not Collateral Attack
 Prescription, for purposes of determining the right to bring an action
against the Assurance Fund, should be reckoned from the moment  Registration, however, does not deprive an aggrieved party of
the innocent purchaser for value registers his or her title and upon a remedy in law.
actual knowledge thereof of the original title holder/claimant. o What cannot be collaterally attacked is the certificate of
 In actions for compensation against the Assurance Fund grounded title and not the title or ownership which is represented by
on fraud, registration of the innocent purchaser for value’s title such certificate. Ownership is different from a certificate of
should only be considered as a condition sine qua non to file such title.
an action and not as a form of constructive notice for the o The fact that a person was able to secure a title in his name
purpose of reckoning prescription. did not operate to vest ownership upon him of the subject land.
o This is because the concept of registration as a form of Registration of a piece of land under the Torrens System does
constructive notice is essentially premised on the policy of not create or vest title because it is not a mode of acquiring
protecting the innocent purchaser for value’s title, which ownership. A certificate of title is merely evidence of
consideration does not, however, obtain in Assurance Fund ownership or title over the particular property described
cases. therein.
o An action against the Assurance Fund operates as form of o It cannot be used to protect a usurper from the true owner; nor
relief in favor of the original property owner who had been can it he used as a shield for the commission of fraud; neither
deprived of his land by virtue of the operation of the Torrens does it permit one to enrich himself at the expense of others.
registration system. Its issuance in favor of a particular person does not foreclose
o It does not, in any way, affect the rights of the innocent the possibility that the real property may be co-owned with
purchaser for value who had apparently obtained the persons not named in the certificate, or that it may be held in
property from a usurper but nonetheless, stands secure trust for another person by the registered owner (Wee v.
because of the indefeasibility of his Torrens certificate of title. Mardo).
o The underlying rationale for the constructive notice rule—  Reconveyance is based on Section 55 of Act No. 496, as amended
given that it is meant to protect the interest of the innocent by Act No. 3322, which states that in all cases of registration
purchaser for value and not the original title holder/claimant— procured by fraud the owner may pursue all his legal and equitable
is therefore absent in Assurance Fund cases. Accordingly, it remedies against the parties to such fraud, without prejudice,
should not be applied, especially since its application with however, to the rights of any innocent holder for value of a
respect to reckoning prescription would actually defeat the certificate of title.
Assurance Fund’s laudable purpose. o It is an action in personam available to a person whose
property has been wrongfully registered under the Torrens
D. Certificate of Title Not Subject to Collateral Attack system in another’s name. It does not seek to set aside the
decree but, respecting it as incontrovertible and no longer
1. Not Subject to Collateral Attack open to review, seeks to transfer or reconvey the land from
the registered owner to the rightful owner.
(a) Rule o Reconveyance is always available as long as the property
 A certificate of title cannot be attacked collaterally. has not passed to an innocent third person for value.
 However, in an action publiciana, the defense of ownership (i.e.,

3. Action to Annul Certificate of Title is Direct Attack that the defendant, and not the plaintiff, is the rightful owner)
will not trigger a collateral attack on the plaintiffs Torrens or
 An action for annulment of certificate of title is a direct attack on the certificate of title because the resolution of the issue of ownership
title because it challenges the judgment decree of title (De Pedro is done only to determine the issue of possession.
v. Romasan Dev.).  Thus, while the RTC could have resolved the issue of ownership
 In Goco v. CA, the Court said that “an action for annulment of provisionally to determine the “better right of possession,” which is
certificates of title to property goes into the issue of ownership of allowed in an action publiciana, it was without any power or
the land covered by a Torrens title and the relief generally prayed jurisdiction to order the reconveyance of the land in dispute
for by the plaintiff is to be declared as the land’s true owner.” Hence, because that can be done only upon a definitive ruling on the said
there is no violation of Section 48 PD 1529 when the title is declared issue—something that cannot be done in an action publiciana.'
null and void by the court.”
 Likewise, a counterclaim raising the nullity of the title is not a
violation of Section 48 of P.D. No. 1529 because a counterclaim
can be considered a direct attack on the title.”
o In DBP v. CA, the Court ruled on the validity of a certificate of
title despite the fact that the nullity thereof was raised only as
a counterclaim. It was held that a counterclaim is considered
a complaint, only this time, it is the original defendant who
becomes the plaintiff. It stands on the same footing and is to
be tested by the same rules as if it were an independent
action.
4. In Ejectment Case
 When the ejectment court resolves the issue of ownership

based on a certificate of title to determine the issue of
possession, the question is posed: is this a situation where the
Torrens title is being subjected to a collateral attack
proscribed by Section 48 PD 1529?
o NO because there is no real attack, whether direct or
collateral, on the certificate of title in question for the simple
reason that the resolution by the ejectment court cannot alter,
modify, or cancel the certificate of title.
 Thus, the issue of whether the attack on a Torrens title is
collateral or direct is immaterial in forcible entry and unlawful
detainer cases because the resolution of the issue of ownership is
allowed by the ROC on a provisional basis only.
 To repeat: when the issue of ownership is raised by the defendant
in his pleadings and the question of possession cannot be resolved
without deciding the issue of ownership, the issue of ownership
shall be resolved only to determine the issue of possession. (Heirs
of Cullado v. Gutierrez)
5. Accion Publiciana
 The issue in an action publiciana is the “better right of

possession” of real property independent of title.
o This “better right of possession” may or may not proceed from
a Torrens title.
 Thus, a lessee, by virtue of a registered lease contract or an
unregistered lease contract with a term longer than one year, can
file, as against the owner or intruder, an action publiciana if he has
been dispossessed for more than one year.
 In the same manner, a registered owner or one with a Torrens title
can likewise file an action publiciana to recover possession if the
one-year prescriptive period for forcible entry and unlawful detainer
has already passed.”
 While there is no express grant in the Rules of Court that the court
wherein an action publiciana is lodged can provisionally resolve the
issue of ownership, unlike an ordinary ejectment court which is
expressly conferred such authority (albeit in a limited or provisional
manner only, i.e., for purposes of resolving the issue of
possession), there is ample jurisprudential support for
upholding the power of a court hearing an action publiciana to
also rule on the issue of ownership.

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C i vi l L a w R e vi e w 2 0 2 2 ( P r o f .

BOOK I. PERSONS AND FAMILY RELATIONS

1. Effectivity of Laws EXC:

(c) Doctrine of Stare Decisis EXC:

7. Computation of Legal Period 2. Nationality Principle

5. When Foreign Laws Cannot be Applied

ARTICLE 17, NCC. XXX

Prohibitive laws concerning persons, their acts or property, and

 Article 17 paragraph 3, NCC: Prohibitive laws concerning

(a) Basic Principle Culpa Aquiliana (Quasi-delict is an example of Extra-contractual

ARTICLE 36, NCC. Pre-judicial questions, which must be decided

Nature of Pending Actions

- crime of bigamy is consummated on the celebration of the subsequent

Morigo vs people: no judicial declaration of nullity of marriage is

Q. A pregnant pedestrian was hit by a vehicle. The mother and child (6

ANSWER: Geluz v. CA: The action primarily belongs to the victim.

(a) If issue is succession

(b) If issue is not succession

Doctrine of Separation of Church and State not applicable:

(a) Dual Concept

(2) As a social institution

ARTICLE 36, FC. A marriage contracted by any party who, at the

(c) Effect of doubt in genitals is by reason of nature

Q. Same-sex Filipino couple married abroad where same-sex marriage

ARTICLE 37, FC. Marriages between the following are incestuous

F. Rules on Validity of Absolute Divorces 1. Concept and Characteristics of Void Marriages

(e) Who can question?

(a) Void Marriages under Article 35

(a) Applicable law Status of subsequent marriage under FC

(3) Fraud (6) Serious and incurable sexually transmitted disease

(5) Impotency 1. Effects of Decree of Legal Separation

(e) Contracting of bigamous Marriage (a) Condonation and Consent

(f) Sexual infidelity or perversion (d) Prescription

ARTICLE 71. The management of the household shall be the right

 Widow has an option of

(a) Law governing property relations

 In writing ARTICLE 85, FC. Donations by reason of marriage of property

(b) Parties to marriage settlement (a) Concept

(1) Non-celebration of marriage (3) Marriage is annulled

4. Donations Between Marriage During Marriage (b) Commencement

 Those brought to the marriage as his/her own shall remain Requisites

(d) Taxes and expenses for repair

(b) Pursuant to judicial order  Upon issuance of a decree of legal separation

(b) Benefit of family home

Paragraph 2 – lifetime of the

(c) Same Manner of Proving

ARTICLE 182, FC. Legitimation may be impugned only by those

(b) Legitimacy (d) Right to Surname

No child under seven years of age shall be separated from the

Visitation Rights Who may exercise substitute parental authority?

Who may exercise special parental authority? Right to Custody

twenty-one years of age mentioned in the second and third

(a) Add a middle name or the mother’s surname, OR

Rules on use of alias Scope of Rule 103

1. What Name May Be Changed Grounds in Republic v. Hernandez:

Requisites Law Article 41 FC Article 390, 391 NCC

For the purpose of contracting the subsequent marriage under the

Q. If the marriage is contracted during the FC, and there is no judicial

BOOK II. PROPERTY  3: Everything attached to an immovable in a fixed manner, in