PROF. ELMER T. RABUYA’s

PRE-WEEK NOTES IN CIVIL LAW
FOR THE 2019 BAR EXAMINATIONS

A. PERSONS & FAMILY RELATIONS

1. What is the “doctrine of presumed identity approach” in conflicts of law?

ANSWER: It also known as the doctrine of processual presumption. Under this
doctrine, if the foreign law is not specifically alleged, or even if alleged it has not
been proven, our courts will presume that the foreign law is the same as our
internal or domestic law.

2. Distinguish between accion in rem verso and solutio indebiti.

Similarities: (1) In both, the plaintiff suffered a loss; (2) In both, the defendant is
correspondingly enriched; (3) In both, the enrichment of the defendant is not
justified because the delivery or payment to him is without legal or just cause; (4)
In both, the defendant has the obligation to return what was unduly delivered or
paid; and (5) In both, the purpose is to prevent unjust enrichment.

Distinctions: An accion in rem verso cannot prosper if the plaintiff has other
available legal remedy under contract, quasi-contract, delict or quasi-delict. Thus:
(1) In accion in rem verso, the source of obligation is law; while in solutio indebiti,
it is quasi-contract; and (2) If the undue delivery or payment is by reason of
mistake of fact or mistake involving a doubtful or difficult provision of law, the
action is based on solutio indebiti; whereas, if the reason for the undue delivery is
mistake of law (which is not doubtful or difficult provision) but there is a need to
prevent unjust enrichment, the action is based on in rem verso.

3. Sosyal Plastic Corp. and Jologs Plastic Corp. are neighboring manufacturing
companies both engaged in the manufacture of plastic products. Sosyal
manufactures plastics used as spare parts of cars while Jologs manufactures
plastics used as kitchen ware items. When Jologs noticed that the business of
Sosyal is more profitable, the former started to pirate the employees of the latter
for the purpose of acquiring the technical-know-how in producing plastics that
can be used as spare parts of a car. After acquiring such knowledge, Jologs
actively competed with Sosyal and sold its products at a lower price to the same
customers of Sosyal resulting to huge losses to the latter. Hence, Sosyal sued
Jologs for damages on the ground of unfair competition. Jologs denies liability on
the ground that Sosyal’s product is not protected by a patent. Is Jologs correct?

ANSWER: No, because the concept of "unfair competition" under Article 28 of the NCC
is very much broader than that covered by intellectual property laws and does not require
a patent for its violation. In order to qualify the competition as "unfair," it must have two
characteristics: (1) it must involve an injury to a competitor or trade rival, and (2) it must
involve acts which are characterized as "contrary to good conscience," or "shocking to
judicial sensibilities," or otherwise unlawful. Both requisites are present in this case.
(Willaware Products Corp. v. Jesichris manufacturing Corp., 734 SCRA 238 [2014])

 
  

4. Juan Dela Cruz, a former Filipino citizen, became a naturalized citizen of

Switzerland. After becoming a Swiss national, he underwent sex reassignment
surgery and had a female organ. Pursuant to the laws of Switzerland, Juan had a
change of sex from “male” to “female” and became Jane Dela Cruz. Thereafter,
Pedro, a Filipino citizen and childhood love of Jane, followed Jane in Switzerland
where they got married. In Switzerland, their marriage is considered valid. Is their
marriage also valid in the Philippines?

ANSWER: The marriage is valid. Following the nationality principle embodied in Article
15 of the NCC, the matter of family rights and duties, status, condition and legal capacity
of persons shall be governed by the national law of the person concerned. As such, in
determining the sexes of Jane and Pedro, they shall be governed respectively by their
national laws. Applying Philippine laws, “Pedro” is a male; while “Jane” is a female
applying the law of Switzerland. Hence, the marriage of Pedro and Jane is a valid
marriage because the parties are a man and a woman even from the point of view of
Philippines laws.

5. Liberty Ilagan, a Filipino citizen, got married in the Philippines before a judge of
the MTC to Daniel Finger, an American citizen. The marriage was only for
convenience, they never lived together as husband and wife, and contracted
marriage only to enable Liberty to acquire US citizenship. When her quest for US
citizenship failed, Liberty filed a petition to declare her marriage to Daniel void on
the ground of absence of consent because the marriage was allegedly in jest and
they did not love each other. If you were the judge, will you grant the petition?

ANSWER: No, because the marriage is perfectly valid because true consent was given
during the marriage ceremony and the same was not defective. “Consent” in marriage is
simply the personal declaration made by the groom and the bride during the marriage
ceremony that they are taking each other as husband and wife. If such consent is given
during the marriage ceremony and the same is not defective, the marriage is perfectly
valid, regardless of the absence of love and the purpose, intent and motive of the parties
in contracting a marriage. The absence of love does not affect the validity of the
marriage. Likewise, the fact that the marriage was entered into for other purposes other
than what the law or the Constitution declares does not make marriage void. (Republic v.
Albios, 707 SCRA 584 [2013])

6. Tisha Olivar married his longtime boyfriend, Rico Sanchez. When she obtained a
copy of her marriage contract from the Philippine Statistic Authority, she was
given two copies of marriage contracts where her name appeared as a
contracting party: the first, where she appeared to have married Lee Min-Ho, a
Korean national; and second, where she appeared to have married Rico
Sanchez. Thereafter, she filed a petition to cancel the marriage contract where
her name appeared as the wife of Lee Min-Ho alleging that she never contracted
a marriage to a Korean national and that her only marriage was with Rico
Sanchez. As a consequence, the public prosecutor filed a criminal action against
her for bigamy contending that Tisha should have obtained first a judicial
declaration of the absolute nullity of her marriage to the Korean national prior to
contracting another marriage, invoking Article 40 of the Family Code. During the

 
  

trial, it appeared that someone used the identity of Tisha in contracting marriage
to the Korean national. If you were the judge, will you convict Tisha of bigamy?

ANSWER: No, because the requirement of obtaining a judicial declaration of the

absolute nullity of the prior void marriage in Article 40 of the Family Code does not apply.
In Republic v. Olaybar, 715 SCRA 605 (2014), where Olaybar appeared to have
contracted a marriage to a Korean national but another person only made use of her
identity in contracting a marriage to the said Korean national (a case of identity theft), the
Court ruled that the proper remedy is Petition for Correction/Cancellation of Entries in
Civil Registry Under Rule 108 and not a Petition for Declaration of Absolute Nullity of a
Marriage because there is no marriage that may be declared void ab initio. Since there
was no prior marriage involving Tisha, even a void one, there was no subsisting
marriage when Tisha contracted her marriage to Rico. Hence, she did not commit
bigamy.

7. Emil was married to Giana when he contracted a subsequent marriage to Tanya.

After the celebration of the subsequent marriage, Emil and Tanya executed an
Affidavit of Legitimation of their child, Athena. Upon the death of Emil, Giana
learned of the birth certificate of Athena and she immediately filed a Petition for
Correction/Cancellation of Entries in the said birth certificate praying for the
following: (a) that the entry in the birth certificate as to the status of the child be
corrected from “legitimate” to “illegitimate”; and (b) that the marriage of Emil and
Tanya be declared void on the ground that it is bigamous. If you were the court,
will you grant the prayer for declaration of the absolute nullity of the second
marriage?

ANSWER: No. In Braza v. City Civil Registrar of Himamaylan City, Negros Occidental,
607 SCRA 638 (2009), where the husband contracted a second bigamous marriage, it
was ruled that a marriage may not be declared void in a Petition for
Correction/Cancellation of Entries in Civil Registry Under Rule 108 because the proper
remedy is a Petition for Declaration of Absolute Nullity of a Marriage.

REMINDERS:

a) Absence of consent and marriage ceremony is NO MARRIAGE; while absence of

legal capacity, authority of solemnizer and marriage license is VOID MARRIAGE.
b) If No Marriage, remedy is Petition for cancellation/correction of entries in Civil
Registry under Rule 108; If Void Marriage, remedy is Petition for Declaration of
Absolute Nullity of Marriage.
c) If No Marriage, Article 40, FC does not apply. If void marriage, Article 40 applies.

8. Vic Dayot, a Filipino citizen, got married to Becky Makapugay, an American

citizen born ni Guam, USA to former Filipino citizens. In 2014, Vic obtained a
decree of absolute divorce from a court in Dominican Republic, which decree of
divorce is valid according to the laws of Guam, USA and capacitated Becky to
remarry. In 2015, Vic married Deena Aparicio, another Filipino citizen in a civil
wedding in Porac, Pampanga. In 2016, Becky renounced her American
citizenship and became a Filipino citizen. In 2017, Vic died leaving an estate

 
  

worth P50 Million. Both Deena and Becky are now claiming to be the surviving
spouse entitled to inherit the estate of the deceased. Becky claims that the
divorce obtained by Vic was not valid because: (1) they are now both Filipino
citizens and divorce is not recognized as valid; and (2) even if they were not both
Filipinos at the time of the issuance of the divorce, the ruling in Republic v.
Manalo cannot be applied because the divorce was obtained prior to the
promulgation of the landmark ruling. Is Becky correct?

ANSWER: No, Becky is not correct. In Republic v. Manalo, (G.R. No. 221029, April 24,
2018), reiterated in Morisono v. Morisono (G.R. No. 226013, July 2, 2018), the Court
ruled that the provisions of Article 26, paragraph 2 of the Family Code will be applicable
regardless of who may have obtained the decree of absolute divorce so long as said
decree releases the foreigner spouse from the marriage, meaning the decree of divorce
is valid pursuant to the national law of the foreigner spouse and it capacitated the
foreigner spouse to remarry pursuant his national laws. Here, the foregoing ruling of the
Court applies since Vic and Becky are covered by the provisions of Article 26, paragraph
2, of the Family Code. In Republic v. Orbecido III, 472 SCRA 114 (2005), the Court
explained that in determining the applicability of said provision, the reckoning point is the
citizenship of the parties at the time the valid divorce decree was obtained and not their
citizenship at the time of the marriage. The contention that the ruling in Republic v.
Manalo will not apply because the decree was obtained by Vic prior to its promulgation is
not meritorious because a ruling of the court interpreting a law is necessarily considered
part of the law from the day of its enactment.

9. Nick Santos was married to Esphie Galang when he asked Lenny Santiago to
marry him. Nick and Lenny executed an Affidavit of Cohabitation where they
made to appear that they complied with the requirements of Article 34 of the
Family Code. Hence, their marriage was celebrated without a marriage license.
When Nick was prosecuted for bigamy, he contended that he did not commit
bigamy because his second marriage was void for having been celebrated
without a marriage license and that it was not really an exceptional marriage
under Article 34 of the Family Code because the Affidavit of Cohabitation was
falsified. Is the contention of Nick meritorious?

ANSWER: No, it is not. As a rule, the crime of bigamy is not committed if the second
marriage is celebrated without a marriage license (People v. De Lara [1955]; Go-
Bangayan v. Bangayan [2013]) because in order for this crime to be committed the
second marriage must have all the essential requisites for validity except for the
existence of a prior marriage. However, if the reason for the absence of a marriage
license in the second marriage was because the parties thereto falsified the Affidavit of
Cohabitation to make it appear to be an exceptional marriage, the crime of bigamy is
committed. It would be the height of absurdity to allow them to use their illegal act to
escape criminal conviction. (Santiago v. People [2015])

NOTE: If the second bigamous marriage is also void on the ground of psychological
incapacity, the crime of bigamy is still committed because not all the effects of the
marriage is totally wiped out by the declaration of its absolute nullity. One of the effects
of the marriage that is not wiped out in Article 36 is the criminal liability of the accused for
bigamy. (Tenebro v. CA [2004])

 
  

10. There are two kinds of bigamous marriages under the Family Code: (a) the
bigamous marriage under Article 35 (4) where the prior marriage is either
perfectly valid or voidable; and (2) the bigamous marriage under Article 40 where
the prior marriage is void ab initio but the subsequent marriage is contracted in
the absence of a judicial declaration of the absolute nullity of the prior void
marriage. In the first, the property regime is that which is provided in Article 148
of the Family Code. In the second, the property regime is either absolute
community (if the void marriage is celebrated without a marriage settlement or if
absolute community is the regime provided for in the marriage settlement) or
conjugal partnership of gains or complete separation (if the same is the property
regime provided for in the marriage settlement).

NOTE: If there is a prior void marriage in the problem and another marriage is contracted
without a judicial declaration of the absolute nullity of the prior void marriage, look into
the date of the celebration of the second marriage: (a) If the second marriage was
celebrated prior to August 19, 1986, the applicable rule is that the void marriage did not
exist for all purposes, including the contracting of another marriage, and a judicial
declaration of the absolute nullity of the prior void marriage is not necessary before
contracting another marriage. Hence what appears to be a second marriage is actually
the first and it is perfectly valid. (Odayat v. Amante [1977]); (b) If the second marriage is
contracted after August 19, 1986 but before the effectivity of the Family Code, the
applicable rule is that a prior void marriage is considered subsisting for purposes of
contracting another one unless there has been a judicial declaration of its absolute
nullity. Hence, if another marriage is contracted in the absence of such judicial
declaration the subsequent marriage is considered contracted during the subsistence of
another marriage, though void, therefore void for being bigamous. (Wiegel v. Sempio-Diy
[1986]); (c) If the second marriage is contracted during the effecttivity of the Family
Code, the same rule as that of Wiegel v. Sempio Diy but your legal basis wil now be
Article 40 of the Family Code.

11. Article 41, FC: Exception to bigamy under Art. 35(4) if the following requisites are
present: (a) the prior spouse had been absent for either 4 years (in case of
ordinary absence) or 2 years (in case of qualified absence); (b) the spouse
present had a well-founded belief that the absentee spouse is already dead; and
(c) prior to contracting a subsequent marriage, the spouse present obtained a
judicial declaration of presumptive death of the absentee spouse. If all three
requisites are present, the subsequent marriage is perfectly valid but it can be
terminated either by the recording of the affidavit of reappearance of the
absentee spouse or by a judicial declaration of the termination or dissolution of
the second marriage. If not all three requisites are present, the second is void for
being a bigamous marriage under Article 35(4) of the Family Code and the proper
remedy is to file a Petition for Declaration of the Absolute Nullity of the second
marriage.

PROBLEM: Cardo Dalisay obtained a judicial declaration of presumptive death of his

wife, Rina Dalisay, while they were still cohabiting in their conjugal dwelling in Quezon
City. After obtaining such judicial declaration from the RTC of Tarlac City, Cardo
abandoned Rina and contracted another marriage to Sophia Andres. Rina learned of the

 
  

subsequent marriage a year after its celebration and the existence of the judicial
declaration of her presumptive death. She wasted no time in filing a petition before the
Court of Appeals for the annulment of the said judgment. The Court of Appeals
dismissed the petition on the ground that it was not the proper remedy. According to the
Court of Appeals, Rina’s proper remedy is to file an affidavit of reappearance before the
civil registry. Is the CA correct? What is the proper remedy of Rina?

ANSWER: No, because the remedy of filing an Affidavit of Reappearance of the

absentee spouse is applicable only when the subsequent marriage is perfectly valid.
Here, the marriage of Cardo and Sophia is void for being a bigamous marriage because
not all three requisites of Article 41 are not present. Rina is not really absentee spouse
and Cardo had not well-founded belief that Rina is already dead. The judicial declaration
of presumptive death was obtained by Cardo through fraud. Since the second marriage
is void, the proper remedy of Rina is to file a Petition for Declaration of the Absolute
Nullity of the second marriage on the ground of bigamy and she has the personality to
file said petition. In cases decided by the Court, it was held that the aggrieved spouse in
the prior marriage has the personality to file a petition for the declaration of the absolute
nullity of the second marriage on the ground of bigamy because he/she is actually the
aggrieved party. (Santos v. Santos [2014]; Juliano-Llave v. Republic [2011]; Fujiki v.
Marinay [2013])

12. Applicable laws in case of remarriage because of presumption of death: Look into
the date of the celebration of the second marriage.
a) If celebrated prior to the effectivity of the Family Code, the applicable law is the
New Civil Code which only requires the following before the spouse present is
allowed to contract another marriage: (1) that the prior spouse must have been
absent either for a period of 7 years (ordinary absence) or 4 years (qualified
absence); and (2) the spouse present has a belief in good faith that the absentee
spouse is already dead. The Civil Code did not require a judicial declaration of
presumptive death. Under the Civil Code, the status of the second marriage is
voidable, or valid until annulled. Hence, the second marriage can only be
terminated by a judgment of annulment. It cannot be terminated by the recording
of the affidavit of reappearance of the absentee spouse because the latter
remedy is applicable only to a subsequent marriage contracted during the
effectvity of the Family Code.

b) If the second marriage is celebrated during the effectivity of the Family Code,
apply the three requisites mentioned in Number 9 above. If all three requisites are
complied, the status of the second marriage is perfectly valid. It is here where the
remedy of recording of affidavit of reappearance applies.

13. Requirement of Judicial Declaration of Presumptive Death: There are two

applicable laws on presumption of death: (a) Article 41 of the Family Code, if the
presumption of death is for the purpose of remarriage. Here, the law requires a
judicial declaration of presumptive death. (b) Articles 390-391 of the New Civil
Code, if the presumption of death is for purposes other than remarriage. Here,
the law does not require a judicial declaration of presumptive death.

 
  

PROBLEM: In 2009, Willy Malas, the soldier husband of Lita Todo-Malas, was declared
missing in action when he took part in military operations against the NPA rebels in
Quezon Province. Since then nothing has been heard of him. In 2017, Lita applied for
the death benefits due to a military serviceman under pertinent laws but she was told by
the AFP to present proof of death or at least a declaration of presumptive death from the
court. For the purpose of obtaining said benefits, Lita applied for and was issued by the
RTC a judicial declaration of presumptive death of her missing husband citing Article 41
of the Family Code. Is the RTC correct?

ANSWER: No, because Article 41 of the Family Code is applicable only if the purpose of
the presumption of death is to contract another marriage. If the purpose of the
presumptive death is other than remarriage, such as for the purpose of obtaining death
benefits, the applicable law is Article 390 or 391 of the Civil Code. Under Articles 390 or
391 of the Civil Code, a judicial declaration of presumptive death cannot be issued for
the following reasons: (1) Article 390-391 of the Civil Code are merely rules of evidence;
(2) being merely rules of evidence, there is actually no controversy and the judgment that
may be issued will not attain finality; and (3) there is no more need for such judicial
declaration because the presumption of death is already established by law. (Tadeo-
Matias v. Republic [2018])

14. Nature and Consequences of Void Marriages:

(a) General rule: A void marriage does not subsist or exist. Hence: the parties are
not spouses; the defect of the marriage can be attacked collaterally (so long as
that issue is necessary for the purpose of resolving the legal question, such as
the right of one over the other); and the defect of the marriage can be raised at
any time even after the death of one of the spouses. Hence, the absolute nullity
of the marriage can be raised in an action for support by one against the other
and in the settlement of the estate of the deceased spouse. (De Castro v.
Assidao-De Castro [2008] and Ninal v. Bayadog [2000] Exception: For purposes
of contracting another marriage, a void marriage is a subsisting marriage unless
there has been a judicial declaration of its absolute nullity. Hence, if another
marriage is contracted in the absence of such prior judicial declaration, the
second marriage is considered contracted during the subsistence of a prior
marriage, although void, therefore it is void for being a bigamous marriage
(Article 40, FC).

(b) Status of Children: Generally, children of void marriages are illegitimate.

However, by way of exception, children of void marriages under Articles 36 and
53 of the Family Code are declared by law to be “legitimate children.”

(c) Applicable Property Regime: If the marriage is void, the property regime is either
Article 147 or Article 148 and said property regime applies even prior to the
judicial declaration of the absolute nullity of the marriage. There is no absolute
community, conjugal partnership of gains or complete separation in a void
marriage. Exception: However, if the marriage is void under Article 40 of the
Family Code, the applicable property regime is either absolute community,
conjugal partnership or complete separation.

 
  

15. Reminders in Voidable Marriages: (1) The marriage is considered valid until
annulled by a final judgment of annulment. In the absence of judgment of
annulment, it is regarded as valid. (2) The marriage can no longer be annulled if:
(a) one of the spouses had already died; (b) the defect of the marriage is already
ratified (a voidable marriage can be ratified except paragraphs 5 and 6 of Article
45); and (c) the 5-year prescriptive period for filing the annulment had already
lapsed. (3) If the ground is lack of parental consent, the person whose consent is
required will depend on the status of the party below 21: (a) if he/she is
legitimate, the consent should be given by the following in the order mentioned:
father, mother, guardian (Article 14, FC); (b) if he/she is illegitimate, the consent
should be given by the mother (Art. 176, FC). (4) Children of voidable marriages
are legitimate. Those conceived prior to finality of judgment of annulment is also
legitimate (Art. 54, FC). (5) Property regime of voidable marriages is
either absolute community, conjugal partnership of gains or complete separation.

16. Reminders in Legal Separation: (a) Cooling-off period is mandatory. Except if

petitioner is wife and ground is an act of violence under RA 9262. (b) Upon
issuance of decree, absolute community or conjugal partnership is terminated
and replaced by complete separation. The “net profits” of the guilty spouse is
forfeited. (c) Effect of subsequent reconciliation: if there is no decree of
reconciliation, no effect. If decree of reconciliation is issued: (1) other effects of
decree of legal separation are set aside. (2) But effects as to property relations
not affected. Hence, property regime is still complete separation. Forfeiture of net
profits remains. (d) How to revive previous property regime?
§ Spouses must execute agreement for revival which must be approved by the
court. If not approved, does not produce effect.
§ Only properties included in the agreement will be the properties of the revived
property regime.
§ Forfeiture of net profits remains unless forfeited property is included again in the
agreement as property of revived property regime.

17. Property Relations --- Articles 96 and 124, Family Code:

a) In administration of properties, if one of the spouses entered into contract w/o

consent of the other, contract is valid but may be rescinded within 5 years if
causes injury to family.

b) In disposition or encumbrance of absolute or conjugal property, to be valid

consent of both spouses is required or court authorization. Otherwise, contract is
void in its entirety.

c) If CPG existed during the Civil Code, when sale w/o consent of other spouse took
place?
§ If sale is made before effectivity of FC, applicable law is Civil Code. Under
NCC, sale is only voidable and subject to 10-year prescriptive period for
annulment.
§ If sale is made during effectivity of FC, applicable law is Art. 124, FC. Hence,
sale is void.

 
  

d) If sale is void, may buyer invoked principle of “buyer in good faith”? YES,
provided that he is able to prove 2 kinds of diligence:

§ Due diligence in determining validity of title of seller; and

§ Due diligence in ascertaining capacity of transacting spouse to represent
other spouse.

18. Property Relations --- Articles 103 and 130, Family Code:

a) If death is the cause of termination of APC or CPG, there is a mandatory

obligation on the part of the surviving spouse to liquidate the property regime
within 1 year from death, otherwise:
§ His subsequent marriage is governed mandatorily by complete separation;
and
§ Any disposition or encumbrance of community or conjugal property is void.

b) IF CPG existed already during the Civil Code, look into when one of the spouses
died:

§ If died before effectivity of FC, there is no mandatory obligation to liquidate.

Hence, effects in Art. 130 not applicable.
§ If died during effectivity of FC, Art. 130 applies because Article 105 of the FC
provides that the new provisions of the FC on conjugal partnership also apply
to the conjugal partnership established in the Civil Code provided that there
shall be no impairment of rights already acquired under the Civil Code.
Hence, the effects in Art. 130 will now be applicable. (Heirs of Go, Sr. v.
Servacio [2011] and Domingo v. Molina [2016])

PROBLEM: Ricardo and Corazon got married in 1980 without a marriage settlement. In
1987, Corazon died. After the death of Corazon, Ricardo did not liquidate their property
regime nor was there settlement of the estate of the deceased spouse. In 1990, Ricardo
contracted another marriage to Luisa without a marriage settlement. What is the property
regime of both marriages?

ANSWER: The property regime of the first marriage is conjugal partnership of gains
because that is the property regime that applies by default in the absence of a marriage
settlement for marriages celebrated during the effectivity of the New Civil Code while the
property regime of the second marriage is absolute community of property because it is
the property regime that applies by default in the absence of a marriage settlement for
marriages celebrated during the effectivity of the Family Code. The second marriage is
not mandatorily governed by the regime of complete separation because Article 130 of
the Family Code does not apply if the conjugal partnership is terminated by death prior to
the effectivity of the Family Code. Here, the provisions of Article 130 can not be applied
because at the time of Corazon’s death, there was no mandatory requirement of
liquidating the conjugal partnership upon the death of the deceased spouse.

19. Property Relations --- Obligations of the ACP or CPG:

 
  

a) If debtor-spouse does not have sufficient property to pay the following: ante-
nuptial debt which did not redound to the benefit of the family, support of
illegitimate children, or civil liability for delict or quasi-delict:

v In APC, the property regime can be immediately compelled to advance the

payment subject to reimbursement. (Art. 94[9], FC)
v But in CPG, the property regime cannot be immediately compelled to
advance the payment because the other obligations of the CPG must first be
satisfied. But after satisfying such other obligations, the property regime can
be compelled to advance the payment subject to reimbursement. (Art. 122,
FC)

b) But the property regime (ACP or CPG) cannot be compelled to advance the
payment in the following:

§ Debts contracted during the marriage by one without the consent of the other
“which did not redound to the benefit of the family.”
§ Support of ascendants and brothers and sisters.

20. Presumption In Favor of Conjugal Partnership (Art. 116, FC):

a) SC ruling: If property is registered in the name of “Juan Dela Cruz, married to

Juana Dela Cruz,” the property is exclusively owned by Juan because the words
“married to” are merely descriptive of his civil status.

v Not applicable if property is proven to be acquired during the marriage because it

will be presumed conjugal. Note that presumption applies if property is proven to
have been acquired “during the marriage,” regardless of the manner of
registration.

v In the absence of proof as to when acquired, the property cannot be presumed

conjugal. Hence, the above ruling will apply.

21. Property Regimes Under Articles 147 and 148, FC:

a) When applicable:
§ If marriage is void ab initio, except Article 40 of the FC.
§ Union/cohabitation of man and woman without the benefit of marriage.

b) As to Void Marriage, property regime is Article 147 if ground is NOT absence of

legal capacity, such as Articles 35(2), (3), (5) and (6) and Art. 36. If void by
reason of Art. 36, property regime is Art. 147 even prior to the judicial declaration.

c) As to Void Marriage, property regime is Article 148 if ground is “absence of legal

capacity,” such as Articles 35(1) and (4), Art. 37 and Art. 38.

d) As to union/cohabitation of man and woman without the benefit of marriage, the

property regime in Article 147 will govern if two are requisites are satisfied: (1)

 
  

the parties are capacitated to marry each other; and (2) the cohabitation is
exclusive. If both requisites are not satisfied, the property regime in Article 148
will apply.

e) The provisions of Articles 50 and 51 are applicable only to marriages which are
annulled (voidable) and declared void by reason of Article 40. Hence, in other
void marriages (not Article 40):

§ There is no APC or CPG that will be liquidated.

§ The provisions of Articles 50 and 51 do not apply.
§ Instead, the co-ownership in Article 147 or 148 need NOT be partitioned in
the same proceeding. Hence, the decree of nullity should immediately be
issued (Dino v. Dino [2011])
§ The obligation to deliver the presumptive legitimes of the children is
applicable only when the marriage is annulled (voidable) or declared void
under Art. 40. Not applicable if declared void by other grounds.

f) As to salaries and wages: In Article 147, equal share even if only one earned the
salary. In Article 148, the salary shall pertain only to the party who earned it.

g) As to properties acquired during cohabitation: Property acquired thru joint efforts,

work or industry by the parties shall be co-owned by them. In Article 147,
however, the contribution need not be actual contribution of Money, Property, or
Industry, but it can be in the form of maintenance of the household or taking care
of the family. In Article 148, however, proof of actual contribution in the form of
Money, Property, or Industry is required.

h) Prohibition against sale of ideal share in Article 147: In the co-ownership existing
in Article 147, a co-owner is prohibited from selling his ideal share during the
cohabitation “without the consent of the other co-owner.” After the cohabitation,
there is no more prohibition.

PROBLEM: A Dutch was married to a Filipina. Subsequently, the marriage was declared
void under Article 36 because of the former’s psychological incapacity. After the
declaration of nullity, the Dutch filed a petition for dissolution of the conjugal partnership
praying for dissolution of the 4 parcels of land acquired thru sale. The Filipina claimed
that the money used to acquire the lots came from her exclusive funds, except the
residential houses on the 2 lots which were acquired using conjugal funds. The RTC
dissolved the conjugal partnership and awarded all four lots to the Filipina but declared
the 2 houses co-owned by the parties. The Dutch appealed to the CA claiming that the
money used to acquire all properties came from him. He then prayed for reimbursement
of ½ of the amount he had paid. (Buemer v. Amores [2012], Perlas-Bernabe Case)

Q1: Is the property regime of the parties conjugal partnership? Answer: No, because the
marriage is void. Since the marriage is void by reason of Article 36, the property regime
is that provided in Article 147 of the Family Code.

 
  

Q2: May the Dutch national be considered co-owner of the 4 parcels of land and the 2
houses? Answer: Only the 2 houses, but not the 4 parcels of land because of the
prohibition in the Constitution.

Q3: May the Dutch national be entitled to reimbursement? Answer: No, because of the
principle of in pari delicto, which does not allow recovery. Secondly, he is not entitled to
reimbursement under the principle of unjust enrichment because the latter principle does
not apply in case of violation of prohibitions under the Constitution.

PROBLEM: An Australian, married in Australia, was assigned to work here in the

Philippines. After 2 years, he married a Filipina and they acquired a house and lot in
Makati. The Filipina did not have the money, property or work to acquire the property.

Q1: Who is entitled to the house and lot? Answer: The Filipina is not a co-owner of the
house and lot because she did not make actual contributions in its acquisition in the form
of money, property or industry. The foreigner is the exclusive owner of the house but not
the lot because of the prohibition in the Constitution. Instead, the lot can be confiscated
by the State thru escheat proceedings.

Q2: What if the foreigner is indebted to a Filipino creditor and he executed a deed of
dacion en pago over the house and lot to pay off his creditor, may the State recover the
property from the creditor? Answer: Not anymore because the defect is deemed cured.

22. Articles 150 and 151, Family Code:

PROBLEM: Jose has been renting a parcel of land co-owned by his sister, Consuelo,
and the latter’s children. Said co-owners, via email, offered to sell the said parcel of land
to Jose which the latter accepted, payable in two installments: P800,000 payable to
Consuelo’s children and P1,200,000 payable to Consuelo. Over the next few years, Jose
made partial payments to Consuelo’s children, leaving a remaining balance of P1.2
Million payable to Consuelo. However, Consuelo decided to cancel the agreement and
informed Jose of her intent to convert the partial payments as rental payments instead.
Jose expressed his disapproval and demanded that the sale should push through. When
Consuelo did not reply, Jose filed an action in court against Consuelo and the latter’s
children for specific performance. The RTC motu propio dismissed Jose’s complaint on
the ground that the parties failed to exert earnest efforts towards a compromise as
required by Article 151 of the Family Code. Is the RTC correct? (Moreno v. Kahn
[2018], Perlas-Bernabe)

ANSWER: No, In Article 151 of the FC, earnest efforts towards a compromise is required
only when the suit is exclusively among members of the same family. The term
“members of the same family” refer to the family relations enumerated in Article 150, as
follows: (1) between husband and wife; (2) between parents and children; (3) among
other ascendants and descendants: and (4) among brothers and sisters, whether of the
full or half-blood. The other collateral blood-relatives are considered strangers to the suit.
Hence, if the suit is between the uncle, on one hand, and the nephews and nieces, on
the other hand, there is no need for earnest efforts towards a compromise.

23. Family Home:

 
  

a) To be duly constitutted as a family home, the actual value of the family residence
at the time of the constitution must not have exceeded P300,000, in urban areas,
or P200,000, in rural areas (Article 157, FC).

b) But even if duly constituted as a family home, it is not protected from claims
enurmerated in Article 155: (1) non-payment of taxes; (2) debts incurred before
constitution of the family home; (3) debts secured by the family home; and (4)
non-payment of wages or non-payment of supplies in the construction of the
family home. In Article 155, no amount shall be return to the family.

c) Applicability of Article 160, requisites: (1) the judgment creditor is not among
those listed in Article 155; (2) at the time of its constitution, the actual value did
not exceed P300,000 or P200,000, as the case may be; (3) it is only after the
constitution that the actual value exceed the maximum amount allowed by law;
and (4) the reason for the increase in value is “voluntary improvement” (or an
increase in value due to any voluntary action of any of the beneficiaries). If the
foregoing requisites are present, then the court can order the sale of the family
home but the amount of P300,000 or P200,000 shall be returned to the family. If
the reason for the increase in the actual value of the family home is “involuntary
improvement” (or an increase in value not attributable to any voluntary action of
the beneficiaries), the family home cannot be sold under the provisions of Article
160 and remains to be protected even if the actual value already exceeded
P300,000 or P200,000, as the case may be. (Eulogio v. Bell, Sr. [2015])

PROBLEM: In 1999, the Spouses Alex and Giana acquired and occupied a house and
lot in Bacoor City, Cavite as their family dwelling. They acquired said property for the
total price of P250,000. In 2015, Vista Land of the Villar Group of Companies acquired
the neighboring lots and constructed therein a mall. After the construction of the mall, the
actual value of the spouses’ house and lot increased to P1.5 Million. May a judgment
creditor of the spouses apply from the court for the sale of the said house and lot?

ANSWER: No, because the increase in the actual value of the family home was due to
involuntary improvement. In order for the family home to be sold under the provisions of
Article 160 of the Family Code, the following requisites must be present: (1) the judgment
creditor is not among those listed in Article 155; (2) at the time of its constitution, the
actual value did not exceed P300,000 or P200,000, as the case may be; (3) it is only
after the constitution that the actual value exceed the maximum amount allowed by law;
and (4) the reason for the increase in value is “voluntary improvement” or due to the
voluntary action of the beneficiaries of the family home. Here, the improvement is
involuntary. Hence, the family home is still exempt from force sale even if its actual value
already exceed the amount of P300,000. (Based on Eulogio v. Bell, Sr. case)

24. Concept of Artificial Insemination Under Article 164 of the Family Code: The egg
must be from the wife although the sperm may that be of the husband or from a
donor. The fertilization of the egg by the sperm takes place artificially (outside of
the body of the wife) but the fertilized egg is rquired to carried by the wife and the
infant must also be delivered by the wife. Our laws do not authorize the use of a
surrogate mother. There is no law recognizing the legal effects of surrogacy. Any

 
  

contract involving the use of a surrogate mother is void because it is contrary to

public policy and morality.

PROBLEM: The spouses Chito and Katrina decided to resort to artificial insemination
using Chito’s sperm and Katrina’s egg. The spouses likewise entered into an agreement
with Angelica whereby the latter committed to carry and deliver the child for the spouses
upon payment of the sum of P1 Million. In the said agreement, Angelica likewise
undertook to deliver the custody of the child to the spouses immediately upon delivery.
Pursuant to said agreement, Angelica carried in her womb the fertilized egg. After
Angelica gave birth to the child, the spouses Chito and Katrina immediately took the
infant in their custody and caused the preparation of the child’s birth certificate where
they named themselves as the child’s biological parents.

Q1: What is the child’s status? Answer: The child is illegitimate child of Angelica and
Chito since the child was conceived and born outside of a valid marriage. The child may
not be considered a legitimate child of Chito and Katrina pursuant to the provisions of the
Family Code on artificial insemination because the said law does not allow the use of a
surrogate mother. In fact, there is no law recognizing the legal effects of surrogacy. In
our law, the one who gave birth to the child is considered as the child’s mother. Hence,
the child is not related at all to Katrina.

Q2: Should Angelica change her mind and decide to recover the child’s custody from the
Spouses Chito and Katrina, can she successfully recover the child from the couple?
Answer: Yes, because an illegitimate child is under the parental authority only of the
mother. Since Angelica is the illegitimate mother of the child, she is entitled to have
custody over the child notwithstanding the surrogate-mother contract she entered into
with the spouses Chito and Katrina because parental authority cannot be validly waived
and transferred except in those instances expressly allowed by law. Since permanent
custody is only a right arising from parental authority, at best what Angelica gave to the
spouses Chito and Katrina is only temporary custody over her minor child. Hence, she
can always recover the permanent custody of her child from said spouses.

25. Validity of Birth Certificate (Sec. 5 of Civil Registry Law): Rules on registration of
the birth of a child ---

§ If the child is legitimate, the birth can be registered either by the father or mother.
§ If the child is illegitimate, the birth certificate must be signed always by the
mother (Sec. 5, Civil Registry Law), otherwise the birth certificate is void
(Barcelote v. Republic [2017]

v Thus, if the birth certificate was signed only by the illegitimate father and he
registered the child under his surname (because he registered the birth of the
child without the consent of the mother), the birth certificate is void and the child
cannot use the void certificate to authorize him to use the father’s surname.
(Barcelote v. Republic [2017])

26. Birth Certificate When Competent Proof of Filiation (Art. 172, FC): As a rule, it
must bear the signature of the alleged parent. However, even if not signed by the

 
  

alleged parent the same is still competent proof of filiation against him/her when
the alleged parent had a hand in its preparation, such as:

§ When the illegitimate father was the one who supplied the information
contained in the birth certificate, including the fact of his paternity (Ilano v. CA
[1994]); or
§ When illegitimate father was the one who registered the birth certificate of the
child in the civil registry (Arado v. Alcoran [2015])

v If this is the proof that will be used, the action can prosper even after the
death of the alleged parent.

27. Private Handwritten Admission of Paternity But Without Signature:

PROBLEM: Ricky and Giana were both third year students in the College of Law when
Ricky got Giana pregnant. When Giana informed Ricky of her pregnancy, Ricky wrote a
letter to his mother informing the latter that he would soon be a father to Giana’s child.
The letter was written by Ricky in his own handwriting although he did not affix his
signature in said letter. In the month that followed, Ricky introduced Giana to his mother,
who immediately became fond of her. When Ricky and Giana were in the midst of their
plans for their wedding, Ricky died in a car accident. Upon the birth of Giana’s child, the
Local Civil Registrar refused to register the child under Ricky’s surname because the
letter where Ricky admitted his paternity did not bear his signature. Hence, Giana filed a
petition for mandamus to compel the LCR to register the child under Ricky’s surname. In
the said petition, Giana introduced as evidence the following: (1) the handwritten
admission of Ricky’s paternity in his letter addressed to his mother; and (2) the result of
DNA test showing Ricky’s paternity over the child. In addition, the mother of Ricky
testified that the child was indeed Ricky’s child. If you were the court, will you allow the
child to use Ricky’s surname?

ANSWER: Yes, because there are other proof of filiation aside from the private
handwritten admission of paternity by the illegitimate father. In a case decided by the
Court, if the admission of paternity is in the father’s own handwriting but not signed by
him, the following rules were adopted by the Court: (1) If said private handwritten
instrument is the only proof of filiation, the requirement of signature should be strictly
applied, in which case, said instrument cannot be considered a competent proof of
filiation; and (2) if there are other proof of filiation, the requirement of signature can be
relaxed and said instrument can be considered a competent proof of filiation. Here, the
testimony of the mother of Ricky favorable to the child is a competent proof of filiation
because said testimony is in the nature of admission against interest. In addition, the
result of the DNA test is also a competent proof of filiation. There being other proof of
filiation, the private handwritten instrument may be considered a competent proof of
filiation that will authorize the child to make use of Ricky’s surname. [Based on Dela
Cruz v. Gracia [2009])

28. Right to Use Illegitimate Father’s Surname:

§ If not recognized, child shall use the surname of the mother. This is
mandatory. He cannot use the father’s surname.

 
  

§ If recognized by the father in writing and signed by the father, the child will
acquire the right to use the father’s surname but not obligated to use the
same.

PROBLEM: In the above problem, what if Ricky did not die, instead he recognized his
paternity over the child with his signature on it but upon the birth of the child Giana
refused to register the child under Ricky’s surname, can the latter compel the former to
register the child under his surname?

ANSWER: No. Upon recognition by the illegitimate father, it is not mandatory on the part
of the child to use his father’s surname because the provisions of Article 176 of the
Family Code, as amended, are merely permissive. Upon recognition, the child will
acquire the right to use the father’s surname but not obligated to use the same. The right
belongs to him. However, during the child’s minority, the decision to use the father’s
surname may be exercised for him by his mother pursuant to the latter’s parental
authority over the child. Here, Ricky cannot compel Giana to register the child under
Ricky’s surname because the decision to do so is part of Giana’s exercise of her
parental authority over her minor illegitimate child.

29. When is administrative adoption allowed?

In case of simulation of the birth certificate of a child prior to the effectivity of RA

11222, those responsible therefore shall not be criminally liable if the simulation is
rectified by way of adopting the child within ten (10) years from the effectivity of said Act.
The adoption of the child may be done judicially or administratively. Whether the
adoption is judicial or administrative, the following are the common requirements: (1) the
purpose of adoption is to rectify a simulated birth made before effectivity of RA 11222;
(2) the simulation is to the best interest of child and child is treated as child of person
responsible; (3) adoption is filed within 10 years from effectivity of RA 11222; (4) the
child is declared legally available for adoption by the DSWD (not required if child is
already an adult or relative by consanguinity/affinity within 4th degree). In order for
administrative adoption to be allowed, it is necessary, however, that the child is living
with the person who simulated the birth certificate for at least 3 years before
effectivity of RA 11222.

In administrative adoption, the Order of Adoptin is issued by the DSWD Secretary

and shall have the same effects as that of a judicial decree of adoption issued by the
court pursuant to the provisions of the Domestic Adoption Act.

30. Mandatory Requirement of Joint Adoption by Spouses:

a) General rule: Joint adoption by the spouses is mandatory. Otherwise, the

adoption cannot prosper.

b) Exception to Joint Adoption: (1) If one is seeking to adopt the legitimate child of
the other spouse; (2) If one is seeking to adopt his/her illegitimate child but the
consent of the spouse is mandatory; and (3) if the spouses are legally separated.

 
  

v In re: Adoption of Michelle Lim and Michael Jude Lim, the spouses Primo and
Monina Lim simulated the birth certificates of Michael and Michelle to make it
appear that they were their children. When Primo died, Monina married Angel
Olario, an American citizen. Availing of the amnesty under DAA, Monina adopted
Michael and Michelle, who were already of legal age at that time. Angel Olario did
not join in the adoption but only executed a written consent to the adoption. The
trial court dismissed the petition for adoption because the spouses did not jointly
adopt. Monina contended that joint adoption is no longer mandatory because it is
needed only for the joint exercise of parental authority and the children to be
adopted were already of legal age and freed from parental authority. RULING:
Joint adoption is still mandatory even if the adoptee is already of legal age
because parental authority is merely one of the effects of adoption.

31. Retroactive Effects of Adoption Decree (Sec. 13, DAA):

PROBLEM: Spouses Lino and Pia, childless, filed for the adoption of Andrea, not related
to them by blood. After a number of hearings and while waiting for the issuance of the
judgment, both spouses died in a car accident, survived only by their respective siblings.
Three months after the death of the spouses, their respective siblings executed separate
deeds of extrajudicial partition of the respective estates of Lino and Pia. A year after, the
court issued the decree of adoption of Andrea. Who is entitled to inherit the estates of
Lino and Pia?

ANSWER: Only Andrea is entitled to inherit because an adopted child excludes the
collateral relatives from intestate succession. Andrea is considered an adopted child of
the spouses because the decree of adoption shall be effective as of the date of the
original petition was filed even if the adopter dies before the issuance of the decree.
(Sec. 13, DAA)

32. Effect of Death of Adopting Parents During Minorty of Adopted Child: If both the
adopting parents die during the minority of the adopted child, all legal ties
between the biological parents and the adopted child which had been severed by
the decree of adoption are automatically restored, applying by analogy the
provisions of Section 20 of the Domestic Adoption Act. (Bartolome v. SSS [2014])

33. Basis of Legal Support: Legal support is based on the relationships enumerated
in Articles 195 and 196 of the Family Code, subject only to the order of liability in
Article 199 of the Family Code. Support is not based on parental authority. The
following are obliged to support each other: (1) the spouses; (2) legitimate
ascendants and descendants; (3) parents and their children, whether legitimate
or illegitimate, and the latter’s chidlren, whether legitimate or illegitimate; (4)
legitimate brothers and sisters, whether full-blood or half-blood; and (5)
illegitimate brothers and sister (but the right of an illegitimate sibling to receipt
support is lost when he is already of legal age and the need for support is
attributable to his fault or negligence). But subject to the order of liability, in the
following order: (a) spouses; (b) descendant, in the nearest degree; (c)
ascendant, in the nearest degree; and (d) brothers and sisters.

 
  

34. Mode of Giving Support: At the option of the giver, support may be given in either
of the following ways: (1) Payment of fixed allowance; or (2) Receiving and
maintaining in the family dwelling the person to be supported. But the latter
option cannot be chosen if there is a legal or moral obstacle thereto (Art. 204,
FC).

PROBLEM: In the Problem mentioned in No. 25, what if Ricky did not die but he and
Giana parted ways and upon the birth of the child, Giana demanded support from Ricky
on behalf of the child. Ricky, however, while admitting his paternity over the child,
wanted to give support to the child by receiving and maintaining Giana and the child in
his dwelling. Can Ricky compel Giana to accept the said concession?

ANSWER: No, because there is a legal obstacle for choosing said option. Under the law,
an illegitimate child is under the parental authority only of the mother (Article 176, FC).
Hence, the illegitimate father cannot obtain custody over a minor illegitimate child by
choosing the option of receiving and maintaining in his dwelling said child since the law
grants only to the mother parental authority over an illegitimate child.

35. Parental Authority:

A. Over a minor legitimate child:

a) If the parents are still living together, both are entitled to exercise parental
authority (joint exercise of parental authority). However, in case of
disagreement, the decision of the father prevails but the wife can seek
appropriate reliefs from the court.
b) In case of separation of the parents and the age of the child is below 7 years
old, the child should not be separated from the mother under the tender-age
presumption rule (Art. 213, par. 2, FC). The rule is mandatory unless there is
a judgment from the court that the mother is unfit to have custody. Since the
rule is mandatory, any agreement to the contrary is void (Dacasin v. Dacasin
[2010]). In case of separation of the parents and the age of the child is at
least 7 and up, the court should choose who between the two parents shall
be entitled to exclusivelty exercise parental authority and the only
consideration is the best welfare of the child, but taking into account all
relevant considerations, such as the emotional, psychological, etc. well being
of the child.

B. Over a minor illegitimate child:

a) Only the mother has parental authority (Art. 176, FC). Hence, only the mother
is entitled to the custody of the child.
b) The illegitimate father is not entitled to have custody over the child, even if he
recognizes his paternity over the child. His only right is visitation right or the
right of access to his child, which is a natural child of every non-custodial
parent.

B. PROPERTY

 
  

36. Significant Impact of Heirs of Malabanan v. Republic (2009 and 2013):

a) Only patrimonial property of the State can be acquired thru acquisitive

prescription, citing Article 1113, NCC.

b) Agricultural lands of the public domain declared alienable and disposable remain
to be properties of public domain. To be converted into patrimonial:

§ There must be an express declaration that they are no longer intended for
public use, public service or for development of national wealth, or express
declaration of their conversion to patrimonial; and
§ Such express declaration must be in the form of a law passed by Congress or
in the form of presidential proclamation in cases where the President is
expressly authorized by Congress to do so.

c) Section 14, Property Registration Decree (Heirs of Malabanan v. Republic):

Par. 1, Sec. 14 (PRD) Par. 2, Sec. 14 (PRD)

Basis of grant Based simply on possession and Based on acquisitive prescription.
of title occuppation of land (not
prescription) which must date
back to June 12, 1945 or earlier
Governing Public Land’s Act (CA No. 141), in Civil Code provisions on
Law rel to PRD prescription, in rel to PRD
Lands covered Agricultural lands of the public Patrimonial lands of the State.
domain (not yet patrimonial) but
declared alienable and disposable But must be patrimonial during the
(not required to be declared so as entire 10 or 30-year period of
of June 12, 1945; sufficient that prescription.
land is already declared so at the
time of the application for
registration).
In par. 1, if all requisites are
present, the land ceases to be
part of the land of public domain
because by operation of law it
becomes private property.

 
  

37. Builder in Good Faith (Article 448, NCC):

Limited Definition Expanded Definition Both LO and Builder in BF

At the time of building,
builder believed that he was
the owner of the land
because he had a title or
mode of acquisition in his
favor which turns out to be
invalid but he was ignorant
of such flaw or defect
invalidating his title or mode
(at least at the time of the
building)
At the time of the building,
the builder knew that he
was not the owner of the
land but the landowner
“expressly consented” to
the building, in which case,
the builder is considered a
builder in good faith under
the expanded definition.
Hence, Art. 448 applies.
At the time of the building,
the builder knew that he
was not the owner of the
land but the landowner did
not expressly consent to the
building although he knew
of the same and did not
interpose any objection, in
which case, both acted in
bad faith. Hence, Art. 448
also applies because the
bad of one is cancelled out
by the bad of the other, as if
both have acted in good
faith.

v In Communities Cagayan, Inc. v. Nanol (2012), the buyers of subdivision lot (on a
contract to sell) constructed a new and bigger house on the lot they purchased
with the express permission of the developer. When the buyers were unable to
continue paying the installments and the developer cancelled the contract to sell,
the Court declared the buyers builders in good faith under the expanded
definition with respect to the house they constructed because the landowner
expressly consented to its construction.

v In Department of Education v. Casibang (2016), when a lot owner allowed the

DepEd to construct a public school building on his land, upon the request of the
municipal mayor, the Court declared DepEd to be a builder in good faith with
respect to the public school building although it was a mere possessor by
tolerance since the land owner expressly consented to its construction.

38. Options of Land Owner Under Art. 448:

2 Options of Landowner:

1) Appropriate building after payment of indeminity (necessary and useful

expenses); or
2) Compel builder to buy land if price is not considerably more than the value of
building.

u Initially, LO cannot compel demolition of building. But after choosing option 2

and builder in good faith failed to pay price of the land, LO can now compel
demolition of building even if Builder acted in good faith.

 
  

39. Natural Accession --- Alluvium:

a) To become private property, accretion must take place on rivers, creeks,

streams or lakes (Art. 84, Spanish Law of Waters; Art. 457, NCC). If accretion
takes place on a sea, the additional soil deposit remains public dominion (Art.
4, Spanish Law of Waters).

b) Process of depositing soil must be exclusive work of nature. If not, soil

deposit is property of public dominion.

v Alluvium presupposes that the water level is more or less maintained. If

the additional area is by reason of the recession of the water level, the
same remains to be property of public dominion because it is simply a
case of a dried up river or lake bed.

40. Co-ownership:

a) Sale of the entire property without consent of other co-owners is not void.
Instead, the sale is simply treated as a sale of the ideal share in the co-
ownership of the selling co-owner. Only his ideal share is affected. (Remedy
of others: demand for partition or legal redemption).

b) Sale of a concrete or definite portion in the co-owned property without the

consent of the other co-owners is not void. Instead, the sale is simply treated
as a sale of the ideal share in the co-ownership of the selling co-owner. Only
his ideal share is affected. (Remedy of others: demand for partition or legal
redemption).

c) A co-owner can sell or mortgage his ideal share without the consent of the
other co-owners. Ergo, he cannot be compelled to sell his ideal share. In case
of sale of ideal share to a stranger without the consent of the others, the
remedy of the other co-owners is legal redemption.

d) In case of conflict between the procedural rule of dismissal with prejudice (if
an action for partition is dismissed for failure to prosecute) and the
substantive right of a co-owner to demand partition at anytime, the latter right
prevails.

e) In action for ejectment, it is sufficient that the action is brought by one of the
co-owners. The others are not required to be joined in the action provided
that the same is filed for the benefit of all. If the action is for the benefit only of
the plaintiff co-owner because he is claiming exclusive ownership over the
property, the other co-owners will now become indispensable parties to the
action. (Art. 487, NCC)

f) For purposes of undertaking repairs for preservation, the will of one of the co-
owners is sufficient. He is not required to obtain consent of the others. After
incurring the necessary expenses, he has a right to demand proportionate
contribution from others. A co-owner may, at his option, choose to renounce

 
  

so much of his interest in the co-ownership corresponding to his share of the

expenses in lieu of paying his proportionate contribution. (Art. 488, NCC)

g) For purposes of incurring expenses for improvement or embellishment and

for purposes of executing an act of administration, the will of the majority in
the co-ownership is required. In co-ownership, however, majority does not
refer to the number of the co-owners but to the controlling interest in the co-
ownership. (Art. 491 and 492, NCC)

h) For purposes of executing an act of alteration, the unanimous consent of all

co-owners is required (Art. 491, NCC). Allowing a third person to construct his
house in the co-owned property is an act of alteration that will require
unanimous consent of all co-owners to be valid.

41. Doctrine of Irrevindicability of Movables:

a) Under this doctrine, the possession of a movable acquired in good faith and
where the previous possessor voluntarily parted with possession is already
eqiivalent to title. As such, the possession can no longer be recovered from
the present possessor.

b) The doctrine does not apply in the following cases: (1) in case of lost movable
or (2) in case of unlawful deprivation of possession. In both cases,
possession can be recovered even from a buyer in good faith without need of
returning the amount for which the buyer paid for the property. The buyer is
entitled to the return of the prince only when he acquired the movable in good
faith at a public sale.

c) The term “unlawful deprivation” is not limited to theft or robbery but also
includes cases of abuse of confidence, such as when the buyer is able to
obtain possession of the immovable in the absence of intent to make the
delivery on the part of the seller. However, the term cannot be over-stretched
to include cases of valid and perfected sale where the buyer already acuired
ownership because the seller intended to make the delivery. In the previous
case, the seller can still recover possession because he was unlawfully
deprived of the possession of the movable. In the latter case, the seller can
no longer recover possession because the buyer already became the owner.
Instead, the remedy of the seller is to recover the unpaid purchase price.

42. Requisites for Compulsory Grant of Right of Way:

a) The dominant estate is isolated or surrounded by other immovables that it

has no adequate outlet going to a public highway. The test is “inadequacy” of
outlet going to a public highway and not mere “inconvenience.” If there is an
adequate outlet going to the public highway, the estate is not entitled to a
compulsory grant of right of way even if said outlet proved to be inconvenient.

b) The isolation is not attributable to the fault of the owner of the dominant
estate.

 
  

c) Payment of proper indemnity.

d) Easement of right of way must be established at that point which is least

prejudicial to the servient estate.

43. Donation:

(1) If donation is intended to be effective upon death of the donor, the donation is
mortis causa, which is actually a devise or a legacy. As to formalities, it
should comply with the formalities of a last will and testament. If an
impossible condition is imposed upon the donation, the donation remains
valid because the impossible condition is considered not imposed (Art. 873,
NCC).

(2) If donation is intended to be effective during the lifetime of the donor, the
donation is inter vivos. A donation inter vivos is either:

a) Pure or simple – where the consideration for the donation is the donor’s
liberality and there is no particular reason for the donation;

b) Remuneratory – where the donation is on account of a past service done

to the donor by the donee but which must not be a demandable debt.
Since the past service is not a demandable debt, the consideration for the
donation is the donor’s liberality.

v Both simple and remuneratory donations are governed by the law on

donation. As to formalities, the requirements of Articles 748 and 749 will
be applicable. If the donation is subjected to an impossible condition, the
donation remains valid because the impossible condition is considered
not imposed (Art. 727, NCC).

c) Onerous – where the donation is for a consideration the value of which is

equal to or more than the value of the donated property. Since the
donation is in exchange for something, it is actually a contract and to be
governed by the law on contracts. As to formalities, it can be made in any
form (Art. 1356, NCC). However, if the onerous donation is subjected to
an impossible condition, the donation itself becomes void applying Article
1183 of the Civil Code.

PROBLEM ON LTD: Spouses Maximo and Eligia had 2 legitimate children, Rogelio and
Orlando, and one adopted, Hilaria. After the death of the spouses, a deed of sale was
allegedly registered over 2 parcels of land in favor of Rogelio and Orlando. Hence, new
TCTs were issued in the name of Rogelio and Orlando. Hilaria filed an action for the
annulment of the sale on the ground that the same is falsified for the purpose of
excluding her from the estate of the Spouses. The RTC ruled that the annulment of sale
is improper because it is a collateral attack on the titles of Rogelio and Orlando.

Q1: Is the RTC correct?

 
  

ANSWER: No, because the resolution on the ownership over the subject parcels of land
does not subject the Torrens title to a collateral attack. What cannot be collaterally attack
is the certificate of title and not the title itself. The certificate of title is the document
issued by the RD known as TCT. The title referred to by law means ownership which is,
more often than not, represented by the certificate of title. (Bagayas v. Bagayas [2013],
Perlas-Bernabe case)

Q2: Assuming that in the above problem, Hilaria did not appeal from the judgment of the
RTC dismissing the action and instead filed a petition for the inclusion of her name in the
certificate of titles in the name of Rogelio and Orlando Bagayas as one of the heirs of the
deceased spouses Maximo and Eligia Bagayas, pursuant to Section 108 of PD 1529.
May such petition prosper?

ANSWER: The petition filed by Hilaria does not actually involve amendment of the
certificates of titles issued to Rogelio and Orlando but the partition of the estate of
Maximo and Eligia. Hence, the petition under Section 108 of PD 1529 is not the proper
remedy. The proper remedy is the institution of an intestate proceedings for the
settlement of the estate of the deceased spouses. (Bagayas v. Bagayas [2013],
Perlas-Bernabe case)

C. SUCCESSION

44. Interplay of Family Code Provisions and Succession:

a) If the marriage is void, the surviving is not a spouse entitled to inherit and the
absolute nullity of the marriage can still be questioned after the death of one
of the spouses (Ninal v. Bayadog).

b) If a decree of legal separation is issue, the right of the innocent spouse to

inherit from the guilty spouse is not affected. On the other hand, if the
innocent spouse is the decedent:

§ The guilty spouse is disqualified to inherit by intestate succession. Hence,

no longer a legal heir nor a compulsory heir.
§ In testamentary succession, any testamentary provision in the will of the
innocent (existing at the time of the issuance of the decree) naming the
guilty spouse as voluntary heir, devisee or legatee is revoked by operation
of law. But the guilty spouse may still be named as voluntary heir, devisee
or legatee if the will is executed only after the issuance of the decree of
legal separation.

c) Effect of subsequent reconciliation: In the absence of decree of reconciliation,

no effect. If a decree of reconciliation is issued, the decree of legal separation
is set aside. Hence:

§ The right of the guilty spouse to inherit from the innocent spouse by
intestate succession is automatically restored.

 
  

§ The testamentary disposition in favor of the guilty spouse is automatically

revived.

d) If the subsequent valid marriage in Article 41 is terminated by recording of

affidavit of reappearance or by a judicial declaration of its
dissolution/termination and the second spouse contracted the marriage in bad
faith, he/she is disqualified to inherit from the spouse present, whether the
succession is testamentary or intestate (Article 43(5), FC).

e) In order for an illegitimate child to inherit thru operation of law (as compulsory
or legal heir), the illegitimate filiation must be proven after the death of the
decedent. Hence, the child must rely on the following proof:
§ Birth certificate signed by the decedent.
§ Birth certificate not signed by the decedent but he participated in its
preparation
§ Public or private instrument of admission of filiation signed by the
decedent.

45. Rule of Substantial Compliance Under Article 809:

PROBLEM: The acknowledgment portion stated that the will consists of 7 pages
including the page on which the ratification and acknowledgment are written, but the
actual physical count reveals 8 pages including the acknowledgment portion. May the
rule on substantial compliance under Article 809 be applied?

ANSWER: No, the will is void. The statement in the Acknowledgment portion of the
subject last will and testament that it “consists of 7 pages including the page on which
the ratification and acknowledgment are written” cannot be deemed substantial
compliance. The will actually consists of 8 pages including its acknowledgment which
discrepancy cannot be explained by mere examination of the will itself but through the
presentation of evidence aliunde (Lopez v. Lopez [2012], Perlas-Bernabe case).

46. Probate of Wills – If Issue Is Preterition:

a) General rule: Probate court can only pass upon issues which affect the “extrinsic
validity” of the will.

b) Exceptions: When probate court may rule on intrinsic validity of the will ---

§ Upon agreement of all heirs concerned;

§ If it involves disposition that is patently invalid on the face of the will;
§ When practical consideration demands, otherwise conduct of probate may
become a useless ceremony.

c) Can probate court rule on the issue of preterition?

§ No, if there are devises and legacies in the will. Even if there is preterition,
there is still a need to conduct probate proceedings for purposes of
distributing the devises and legacies because preterition does not affect the

 
  

devises and legacies. Hence, practical consideration does not dictate that the
probate court should resolve the issue of preterition.

§ Yes, if there are no devises and legacies but purely institution of heirs. If
preterition indeed exists, the institution of heirs is annulled in its entirerity
thereby resullting into intestacy. Hence, if preterition indeed exists there is no
need anymore to conduct probate proceedings. Here, practical consideration
dictates that the probate should first resolve the issue of preterition because
such issue will determine the necessity of conducting probate proceedings.

47. Three Lines of Transmission in Reserva Troncal:

1. First line of transmission, from the Origin going to Prepositus. The mode of
transmission is thru “gratuitous title,” either donation or inheritance. The
Origin is either an ascendant of the Prepositus or his brother or sister. The
Prepositus is a descendant, if the property came from an ascendant, or a
sibling, if the property came from another sibling.

2. Second line, from the Prepositus going to the Reservista. The mode of
transmission is thru “succession by operation of law.” Meaning, the reservista
inherited from the Prepositus either as a legal heir or as a compulsory heir.
The Reservista is another ascendant of the Prepositus, not the Origin. If the
property is inherited from the Prepositus by a collateral relative, there is no
reserva troncal. Note that the Reservista (ascendant) inherited the property
by operation of law from the Prepositus (descendant) because the latter died
without leaving legitimate descendants.

3. Third line, from the Reservista going to the Reservatario. The mode of
transmission is thru “legal succession” as a legal heir of the Prepositus. The
Reservatario is inheriting from the Prepositus (and not from the Reservista).
The Reservatario is not required to be living at the time of the death of the
Prepositus but required to be living at the time of the death of the Reservista.

Important Legal Consequences:

a) During the lifetime of the reservista, he is the owner of the property. However,
his ownership or right is subject to a resolutory condition --- that is if at the
time of the reservista’s death, there is a living reservatario --- the reservista
will lose his ownership over the property because the same will be inherited
by the reservatario from the Prepositus by way of intestate succession and
the property does not form part of the reservista’s estate. However, if the
resolutory condition is not fulfilled --- meaning if at the time of the reservista’s
death, there is no living reservatario --- the reservista’s right over the property
becomes absolute and the same forms part of his estate that will be inherited
by his own heirs.

b) Since the reservista is the owner of the property during his lifetime, he can
validly dispose of the property by way of disposition inter vivos (such as sale
or donation) or by way of disposition mortis cause (in his will). As a rule,

 
  

however, the buyer will be getting the property subject to the same reservable
condition unless the buyer was not aware of the reservable condition of said
property, in which case the buyer may invoke the defense of buyer in good
faith. If the buyer acted in good faith, the reservatario cannot anymore
recover the property from him even if the resolutory condition is fulfilled.

c) During the lifetime of the reservista, the interest of the reservatario is merely
inchoate. The property, during that time, is regarded as future inheritance and
may not, therefore, be the object of any contract; otherwise, the contract is
void. Since it is possible for the reservatario to lose the property even if the
resolutory condition is fulfilled if it is dealt to a buyer in good faith, the
reservatario must protect/preserve his inchoate interest during the lifetime of
the reservista.

Who Can Be Reservatario: To be a reservatario, the following requisites must be

satisfied: (1) he must be a third degree blood relative of the Prepositus (from whom he
inherits by legal succession); (2) he must be from the same blood line where the
property came from; (3) he must also be related by blood to the Origin; (4) if there will be
several qualified after applying the first three requisites, apply the rules of intestate
succession to determine who shall inherit from the Prepositus as the latter’s legal heir.

PROBLEM: After the death of her husband, Rico, Karel married anew to Emil. With Rico,
she had a child, named Oscar. With Emil, she also had a child, named Peter. During the
lifetime of Karel, Oscar donated a parcel of land located in Tagaytay in favor of Peter.
Several years after the donation, Oscar, Karel and Peter died successively. Upon Peter’s
death, the land donated to him by Oscar was inherited by Emil thru intestate succession.
Upon the death of Emil, the following claimants over the subject parcel of land emerged:
(a) Ruperto, the father of Rico; (b) Martin, the father of Karel; and (c) Rodrigo, the father
of Emil.

Q1: Who among the foregoing ascendants shall be entitled to the property?

ANSWER: It is Martin who is entitled to the property because is the reservatario. He is

related by blood to Peter, the Prepositus, within 3rd degree; he is from the same blood
line where the property came from; and he is also related by blood to Oscar, the Origin.
Here, the requisites of reserva troncal are present, as follows: (1) the property originally
came from a brother (the Origin) and transmitted thru gratuitous title to another brother
(the Prepositus); (2) the Prepositus died without leaving legitimate descendants; (3)
after the death of the Prepositus, the same property was inherited by an ascendant
(Emil) thru succession by operation of law. The property cannot go to Ruperto because
he is not related by blood to the Prepositus. The property cannot also go to Rodrigo
because he is not related by blood to the Origin. Hence, both Ruperto and Rodrigo are
not reservatarios.

Q2: If during the lifetime of Emil, he sold the property to Diego, a third person. Is the sale
valid?

 
  

ANSWER: Yes, the sale is valid because during the lifetime of the reservista he is the
owner of the property. Hence, he can dispose of the property by way of disposition inter
vivos.

Q3: If Emil sold the property to Diego, can Martin still recover the said property from
Diego after Emil’s death?

ANSWER: If Diego purchased the property with knowledge of its reservable condition,
Martin can still recover the property from him because he is a buyer in bad faith. On the
other hand, if Diego purchased the property without knowledge of its reservable
condition, Martin can no longer recover the property from him because he is a buyer in
good faith.

48. Barrier Rule (Art. 992, NCC):

a) The barrier rule is applicable only in succession by operation of law (legitime and
intestate succession). It does not apply to succession by will.
b) Under the barrier rule, the illegitimate child cannot inherit from his legitimate
brothers and sisters and vice-versa.
c) Under the barrier rule, the illegitimate child cannot inherit from the legitimate
relatives of the parents and vice-versa. Hence, in order for the barrier rule to
apply, the parent of the illegitimate child must be himself LEGITIMATE.
d) On the other hand, if the parent of the illegitimate is ALSO ILLEGITIMATE, the
barrier rule does not apply. Instead, the rights of the parent (who is himself
illegitimate) to succession are transmissible to his descendants, whether they are
legitimate or illegitimate (Art. 902 and 990, NCC)
49. Fideicommissary Substitution:

a) In order for a fideicommissary substitution to be valid, the following limitations

must not be violated: (1) the substitution must not go beyond one degree
counted from the first heir (fiduciary), hence, the fiduciary and the
fideicommissary heir (second heir) must be related to each other by one
degree or one generation (only parent and child can be fiduciary and
fideicommissary heirs); (2) both the fiduciary and fideicommissary heirs must
be living at the time of the death of the testator; and (3) the substitution
cannot be imposed upon the legitime.

b) If the fideicommissary substitution is VALID, the fiduciary has the obligation of

preserving and transmitting the property to the fideicommissary after the
termination of the usufruct. As such, upon the death of the testator, what the
fiduciary inherits is only the right of usufruct over the property while the
fideicommissary heir inherits the naked ownership over the property. While
the fiduciary is entitled to exercise his right of usufruct, the fideicommissary
heir cannot demand for the delivery of the property to him. The usufruct is
terminated either upon the lapse of the period provided by the testator in the
will or upon the death of the fiduciary. Since the fideicommissary heir is
already the naked owner, he can sell the property during the lifetime of the
fiduciary but without affecting the latter’s right of usufruct.

 
  

c) If the fideicommissary substitution is NOT VALID, only the substitution is

considered not imposed but without affecting the validity of the institution of
the first heir.

50. Important Principles Concerning Preterition:

a) Effect of preterition: It annuls the institution of heirs in its entirety but the
devises and legacies shall remain valid.

b) In order for preterition to exist, the following requisites must be present: (1)
the omitted compulsory heir must be a compulsory heir in the direct line.
Hence, the omission of the spouse in the will is not preterition but a case of
invalid disinheritance. However, the omission of the following will be a case of
preterition: legitimate child, adopted child, illegitimate child, conceived child in
the mother’s womb and ascendant, if at the time of the death of the testator
he has no legitimate descendants; (2) the omission is complete or total,
meaning, the omitted compulsory heir did not receive any part of the estate,
either during the testator’s lifetime or after his death; (3) the omitted
compulsory heir survived the testator (however, even if the omitted
compulsory heir predeceased the testator, there is still preterition if he can be
represented by his descendant); and (4) the omission is unintentional
(because if it is clear that the omission is deliberate or intentional, it is a case
of invalid disinheritance and not preterition).

c) Distinguish preterition from invalid disinheritance: In the former, the institution

of heirs is annulled in its entirety but without affecting the devises and
legacies. In the latter, on the other hand, the institution of heirs is not annulled
in its entirety but the invalidly disinherited heir is simply restored to what is
due to him or to her under the law (including his legitime and his share in
intestate succession, if any).

EXAMPLE: Testator has 4 legitimate children (A, B, C and D). In his will, he instituted as
sole heirs to his estate of 1 Million A, B, C and his friend, F, omitting D.

⇒ If D is preterited, A, B, C and D will get equal shares in intestate succession. F will

not get anything because the Iinstitution of heirs is annulled in its entirety.

⇒ If D is only invalidly disinherited, ½ of the estate will go to A, B, C and D in equal

shares as their legitime (P125,000 each). The other ½ will go to the instituted heirs
(A, B, C and F) in equal shares (P125,000). Here, F will still get a share because the
institution of heirs is not annulled but F’s legitime is simply restored to him.

51. Simplied Rules of Intestate Succession:

1st Order of Succession: Legitimate Chidlren or Descendants

a) Effect: The legitimate ascendants and all collateral blood relatives of

decedent are excluded. But the surviving spouse and illegitimate children
concurs as legal heirs.

 
  

b) Who among the descendants shall be legal heirs?

1. First, follow rule of proximity. If all children are alive, capacitated, none is
disinherited and all will be accepting the inheritance, the grandchidlren
cannot inherit in any capacity.

2. If there is vacancy in the first degree (among the children) by reason of

predecease, incapacity or disinheritance, the grandchildren can inherit by
representing their respective parents. Hence, grandchildren ordinarily
inherits by representation (per stirpes).

3. If the vacancy is by reason of repudiation, an heir who renounces his

share cannot be represented. If only some (not all) repudiate, the
repudiated shares will go to the co-heir by accretion. If all children
repudiated their inheritance, the grandchildren will become legal heirs in
their own right (per capita).

c) In case of concurrence among the legitimate chidlren, surviving spouse and

illegitimate chidlren: the share of the legitimate child is double than the share
of the illegitimate child; the share of the surviving spouse is the same as the
share of each legitimate child; and the share of the illegitimate child is one-
half of the share of each legitimate child.

EXAMPLE: 2 LCs, SS and 2 ILCs. Estate is P1 Million.

Formula: (2x + 2x ) + (2x) + (x + x) = 1 Million
Share of LC Share of SS Share of ILC

8x = 1 Million
x (share of each ILC) = P125,000
2x (share of each LC and SS) = P250,000

In case of concurrence between LCs and several ILCs, watch for impairment of the
legitime of the legitimate children. In case of such impairment, return to them their
legitimes and that will also be their shares in intestate succession.

EXAMPLE: 2 LCs, SS and 3 ILCs. Estate is P1 Million.

Formula: (2x + 2x ) + (2x) + (x + x+x) = 1 Million
Share of LC Share of SS Share of ILC
4x vs. 5x (legitimes of LCs are impaired)

HENCE, return to them their legitimes:

2 LCs (500,000) = P250, each

SS = P250,000
ILCs (250,000/3) = P83,333.33

 
  

2nd Order of Succession: Legitimate Parents or Ascendants

a) Effect: All collateral blood relatives are excluded. However, the surviving
spouse and illegitimate children concurs as legal heirs.

b) Who among the ascendants shall be the legal heirs?

1. Follow the rule of proximity. Here, proximity is an absolute rule because

there is no representation in the ascending line. Hence, if only the mother
survives. She excludes all grandparents.

2. If both parents (father and mother) have predecased the decendent, the
share of the ascendant shall be divided equally between the paternal side
and the maternal side.

c) In case of concurrence:
⇒ LA and SS: ½ (LA); ½ (SS)
⇒ LA and ILC: ½ (LA); ½ (ILC)
⇒ LA, SS and ILC: ½ (LA); ¼ (SS) and ¼ (ILC)

3rd Order of Succession: Illegitimate Children

a) Effect: All collateral blood relatives are excluded. But the surviving spouse
inherits together with the illegitimate chidlren.
b) Only those illegitimate chidlren who can establish their illegitimate filiation
upond death of the illegitimate parent are entitled to succeed. Hence, the
action to establish illegitimate filiation must be based on paragraph 1 of
Article 172 (birth certificate or any public or private instrument of admission of
filiation).

c) In case of concurrence between ILC and SS: ½ (ILC); ½ (SS)

4th Order of Succession: Surviving Spouse (SS)

a) Effect: All other collateral blood relatives are exlcuded, except the group of
Brother/Sister/Nephews/Nieces (B/S/N/N).
b) In case of concurrence between SS and B/S/N/N: ½ (SS); ½ (B/S/N/N)
c) If marriage is void, the surviving is not a spouse. Therefore, not entitled to
inherit.
d) If there is a decree of legal separation and the surviving is the guilty spouse,
he is disqualified to inherit.

5th Order of Succession: B/S/N/N

a) Effect: The other collateral blood relatives are excluded.

 
  

b) Take not of barrier rule. Legitimate B/S/N/N cannot inherit from illegitimate
B/S/N/N and vice versa.
c) If some are full-blood, some are half-blood, the FB gets a share double than
the HB.
d) Within this group, the law allows representation in favor of N/N if they survive
with B/S of the decedent. However, if only N/N survive, they shall inherit in
their own right (per capita).

6th Order of Succession: All other collateral blood relatives.

a) Up to 5th degree.
b) Subject to the rule of proximity.
c) Proximity is an absolute rule because there is no representation within this
group.
d) If some are full-blood, some are half-blood, the FB gets a share double than
the half-blood.

7th Order of Succession: State is the ultimate heir.

52. Rules of Intestate Succession to Estate of “Illegitimate Decedent”:

a) Illegitimate Parents are excluded by any kind of descendants of decedent,

whether legitimate or illegitimate.
b) If no descendants, Illegitimate Parents inherit together with SS: SS (1/2); ILP
(1/2)
c) If no ILP, other ascendants are no longer legal heirs.
d) In the absence of descendants, SS and ILP, the illegitimate B/S/N/N are the
legal heirs.
e) In the absence of descendants, SS, ILP and Illegitimate B/S/N/N, other
collateral blood relative are no longer legal heirs. State inherits the entire
estate.

D. OBLIGATIONS & CONTRACTS

53. Summary of Principles Governing Natural Obligations:

a) Cannot be compelled in court. Performance must be voluntary.

b) But if voluntary fulfilled, creditor is authorized to retain payment.
c) Can be novated and converted into civil obligation (ex. A debt that has
prescribed can be the subject matter of novation).
d) Can be the subject matter of guaranty, suretyship, mortgage or pledge.
e) But it cannot be the subject of legal compensation (because legal
compensation requires that both debts be demandable).
f) An agreement for the payment of monetary interest must be expressly
stipulated in writing to be a civil obligation (Art. 1956, NCC). If not in writing,
the obligation to pay monetary interest is a case of natural obligation (Art.
1960, NCC).

 
  

54. Mixed Conditional Obligation:

Q1: What if obligation is subject to a suspensive condition and the fulfillment of such
condition is dependent partly upon the will of the debtor and partly upon the will of a third
person, what will happen to the obligation if the third person complied with the condition
but the debtor intentionally prevents its fulfillment?

ANSWER: The obligation is valid and becomes due and demandable because the
condition is deEmed constructively fulfilled. Under the doctrine of constructive
fulfillment of a suspensive condition in Article 1186 of the Civil Code, if the debtor
intentionally prevents the fulfillment of the suspensive condition the same is deemed to
be constructively fulfilled.

Q2: What if in the above problem, it was the debtor who did all in his power to comply
with the condition but the third person failed to fulfill his part, what will happen to the
obligation?

ANSWER: The obligation is valid and it becomes due and demandable because the
condition is deemed constructively fulfilled following the rule on constructive
fulfillment of mixed conditional obligation. Under said rule, if in a mixed conditional
obligation the debtor did all in his power to comply with the condition the condition but
the entire condition is not fulfilled because of the third person over whom the debtor is
exercising no control, the entire condition is likewise deemed to have been constructively
fulfilled. (International Hotel Corp. v. Joaquin, Jr. [2013])

55. Rules on Legal Tender (Art. 1249, NCC):

a) If there is an obligation to pay a sum in money, the rule of legal tender

applies. Example: In the obligation of the buyer to pay the purchase price in a
contract of sale. Here if the tender of payment is in legal tender and it is
refused without just cause, the remedy is consignation because there is a
debt due.

b) If there is no obligation to pay because the payment of the price is merely

incidental to the exercise of a right (such as payment of redemption price).
The rule of legal tender is not applicable. Instead, the tender of payment in
the form of cashier’s or manager’s check is sufficient to preserve the right.
The remedy is not consignation but to compel redemption.

56. Extinctive and Modificatory Novation:

a) The novation is extinctive if a previous obligation is extinguished by way of

creating a new one. Here, a new contract is made which resulted in the
creation of a new obligation resulting in the extinguishment of the previous
obligation. For example: If the new contract is totally incompatible with the
previous obligation on every point, there exists an implied extinctive novation.

b) The novation is modificatory if the obligation is not extinguished by the new

contract but is simply modified. Example: If the new contract is not totally

 
  

inconsistent with the obligation because the inconsistencies are only on

certain points (not on every point), what exists is merely a case of
modificatory novation. The obligation is not extinguished but only modified by
the new contract.

PROBLEM: MPTC offered to sell computer hardware and equipment to Ace Corp. Ace
Corp. accepted the offer and issued purchase order. Thereafter, MPTC delivered the
products and issued invoice receipt. In the invoice receipt, it was stated: “title to said
property is reserved to MPTC until compliance with the terms and conditions and
payment of the price.” The invoice receipt was received by a representative of Ace Corp.
upon delivery. When Ace Corp. failed to pay after nine months from delivery, MPTC
demanded for payment of the price. Ace Corp. decided, however, to return the products
arguing that the contract was a contract to sell because of the provision in the invoice
which according to Ace Corp. novated the contract from contract of sale to contract to
sell. Is Ace Corp. correct?

ANSWER: There is no novation, whether extinctive or modificatory because the

imposition in the invoice receipt is merely a unilateral proposition of MPTC done after the
perfection of the contract which was not consented to by Ace Corp. The invoice receipt is
merely acknowledgment of the delivery of the things purchased and not a new contract.
(Ace Foods, Inc. v. Micro Pacific Technologies Co., Ltd. [2013], Perlas-Bernabe
case)

57. Novation By Substitution of Person of Debtor:

a) Whether novation is done expressly or impliedly, there must be clear

agreement for the release of the old debtor and that a third person will
assume his place. For example: The buyer and the seller of the mortgaged
property executed a Deed of Sale with Assumption of Mortgage. The creditor
bank simply received a copy of the deed and accepted payments in the
following months from the buyer. Was there novation? Answer: There was
none because the creditor did not give his consent to the substitution. The
creditor’s act of receiving a copy of the deed is not equivalent to giving its
consent to the substitution. Likewise, the creditor’s act of accepting payments
from the buyer did not likewise equate to its consent to the substitution
because a creditor is allowed to accept payments even from strangers.

b) The substitution may either be a case of delegacion or expromision. It is

delegacion, when the initiative for the substitution emanates from the debtor
himself. Necessarily, it has the consent of the debtor, the third person and the
creditor. It is expromision if the initiative for the substitution did not emanate
from the debtor but from the third person. Expromision may be made either
with the consent or without the consent of the debtor.

58. Legal and Conventional Subrogation: Legal subrogation takes place by operation
of law while conventional subrogation takes place by agreement of the parties.

a) Legal Subrogation can only exist in the following situations:

 
  

§ If a less preferred creditor will pay a more preferred creditor. As to the

preferred credit, there will be legal subrogation.
§ If a third person interested in the fulfillment of the debtor’s obligation
pays the debtor’s obligation, even without the latter’s consent.
§ If a third person NOT interested in the fulfillment of the debtor’s
obligation pays the debtor’s obligation but only with the latter’s
consent.

b) Summary of rules governing payment by a third person interested in the

fulfillment of the debtor’s obligation:
§ He is considered third person “interested in the fulfillment of the
obligation” if he will become liable for the payment of the debtor’s
obligation if the same is not paid by the debtor, either thru his person
(as in the case of guarantors and sureties) or thru his property (as in
the case of third-party pledger or accommodation mortgagor).
§ He can compel the creditor to accept payment coming from him.
§ If he pays the debtor’s obligation even without the latter’s consent, he
is entitled to full reimbursement of the amount he paid and he is
subrogated to the rights of the creditor.

c) Summary of rules governing payment by a third person NOT interested in the

fulfillment of the debtor’s obligation:
§ A mere buyer of the mortgaged property does not become a third
person interested in the fulfillment of the debtor’s obligation.
§ He cannot compel the creditor to accept payment coming from him.
But if the creditor accepts, the payment is valid and will extinguish the
debtor’s obligation.
§ If he pays with the debtor’s consent, he is entitled to full
reimbursement of the amount he paid and he is subrogated to the
rights of the creditor.
§ If he pays without the debtor’s consent, he can demand
reimbursement only up to the extent that his payment has been
beneficial to the debtor and he is not entitled to be subrogated to the
creditor’s rights.

d) Conventional subrogation can only exist if consented to by the parties to the

original obligation (the debtor and the creditor) and the third person who will
acquire the creditor’s rights. Conventional subrogation is a new contract that
will only be perfected upon consent of all three persons.

e) Conventional subrogation is different from assignment of the credit, although

in both the creditor’s rights are transferred in favor of a third person, who will
acquire the right to exercise those rights not only against the debtor but also
against third persons, such as guarantors, sureties and mortgagors. They
differ, as follows:

§ Conventional subrogation is a mode of extinguishment of the

obligation. The credit that is transferred to a third person is no longer
the same obligation of the debtor to the previous creditor, but a new

 
  

one. Hence, in conventional subrogation it is possible that the defects

of the previous obligation may already be cured in the new obligation.
Additionally, the debtor’s consent is necessary in conventional
subrogation.

§ Assignment of credit, on the other hand, is not a mode of

extinguishment of obligation. The credit that is transferred to a third
person is very same obligation of the debtor to the creditor. Hence, if
there are defenses which the debtor can interpose against the
assignor, he can likewise interpose those defenses against the
assignee. Additionally, in assignment of credit, the debtor’s consent is
not necessary for the validity of the assignment.

f) In determining whether the transfer of the creditor’s rights to a third person is

a case of conventional subrogation or assignment of the credit will depend on
the intention of the parties as expressed in the agreement. If the agreement
says that the transfer of creditor’s rights will not become valid and effective
unless consented to by the debtor, the transaction is conventional
subrogation because in assignment of credit, the debtor’s consent is no
longer necessary. If such is the case and the consent of the debtor is not
obtained, there is no conventional subrogation and the transaction may not
be treated as assignment of credit. Hence, there shall be no valid transfer of
the creditor’s rights to the third person. On the other hand, if there is simply a
transfer of the creditor’s rights and the agreement does not say that it shall
become valid and effective only if consented to by the debtor, the transaction
is simply assignment of credit.

59. Stipulation pour autrui (Art. 1311, par. 2):

a) Requisites of stipulation pour autrui: (1) there is a stipulation in favor of a third

person; (2) the stipulation is a part, not the whole, of the contract; (3) the
contracting parties clearly and deliberately conferred a favor to the third
person — the favor is not an incidental benefit; (4) the favor is unconditional
and uncompensated; (5) the third person communicated his or her
acceptance of the favor before its revocation; and (6) the contracting parties
do not represent, or are not authorized by, the third party. (Republic v. Africa
[2015], Perlas-Bernabe case)

b) If the third person accepted the benefit, the same can no longer be withdrawn
by the contracting parties and it will entitle the third person to have a cause of
action against the parties, by way of exception to the principle of relativity of
contracts.

60. Distinguished Between Option and Right of First Refusal:

a) Similarities: Both are preparatory contracts. Both create an exclusive privilege

on the part of one person to enter into a contract with another person.

 
  

b) Distinctions: If there is already a definite offer, meaning both the object and
the cause or the price of the contemplated contract are already certain, and
what is lacking is mere acceptance of the offer, the grant of exclusive
privilege is option and not right of first refusal. In RFR, only the object of the
contemplated contract is certain but the price and other terms and conditions
are yet to be negotiated. In option, the period for the exercise of the privilege
is always a definite period while in RFR such period may either be definite or
indefinite.

c) Rules in Option:

§ If the option is NOT supported by a consideration distinct and

separate from the consideration that will be supporting the
contemplated contract, the option does not become a contract and it is
not binding between the parties. Hence, the offeror can still withdraw
the offer provided that the withdrawal must be made prior to its
acceptance.

§ If the option is supported by a consideration distinct and separate from

the consideration that will be supporting the contemplated contract,
then it becomes a contract which binds both the parties. Hence, the
offeror cannot withdraw the offer during the period agreed upon,
otherwise he will be liable for damages by reason of the breach of the
contract of option

§ An option contract is necessarily an onerous contract, hence, it cannot

be supported by mere liberality. The consideration in an option
contract can either be money, property, service or anything of value. If
the consideration is money, it is called “option money.” But “option
money” must be distinguished from “earnest money.” They differ as
follows: (a) Earnest money is part of the price of the contemplated
contract, hence, it is proof of the perfection of the contract of sale;
whereas, option money is payment for the option and it does not form
part of the purchase price; (b) Hence, even if the term “option money”
is used but if the same forms part of the purchase price in the
contemplated contract of sale, it is in reality an earnest money.

d) Rules in Right of First Refusal:

§ The grantee of the RFR is entitled to the first offer of the grantor. If he
refuses the offer, the grantor is now free to offer it to someone else at
the same price (or even higher). But if the grantor offers it to someone
else at a lower price, that will be a violation of the grantee’s RFR.

§ If the grantor violates the grantee’s RFR and enters into a contract (of
sale for example) with a third person, such contract is rescissible
under Article 1381, par. 3 of the Civil Code because it is considered in
fraud of creditor. The court can rescind the contract if the third person
acted in bad faith, or with knowledge of the existence of the grantee’s

 
  

RFR. On the other hand, if the third person acted in good faith (or
without knowledge of the grantee’s RFR, the contract cannot be
rescinded. Instead, the remedy of the grantee is simply recovery of
damages against the grantor.

61. Rescissible Contracts:

a) Rescission in Art. 1191 vs. Art. 1381: In 1191, rescission is a principal

remedy on the ground of breach of faith; whereas, rescission in 1381 is a
subsidiary remedy on the ground of economic prejudice, lesion, damages or
fraud. Hence, the 4-year prescriptive period in Article 1389 applies only to
rescission as a subsidiary remedy. The prescriptive period of the action for
rescission in 1191 is either 10 years (if contract is in writing) or 6 years (for
oral contracts).

b) Nature of rescissible contract in 1381: It is valid, enforcebale, therefore

binding and obligatory between the parties unless and until the contract is
rescinded by the court. In the absence of an order of rescission, the defect of
the contract cannot be used as a defense. Hence, a rescisible contract can
only be questioned by way of a direct action for rescission.

c) In Article 1381 (1) and (2), the contract entered into by the guardian or legal
representative on behalf of the ward or absentee must not involve contracts
of disposition or encumbrance of real property of the ward or absentee
without judicial approval, otherwise, the contract is unenforceable under
Article 1403 (1), NCC. Hence, the contracts referred to in Article 1381 (1) and
(2) are contracts other than disposition and encumbrance of the real property
of the ward or absentee where the latter suffers lesion by more than ¼ of the
value of the property and the contract is not approved by the court. If the
contract is approved by the court, it is perfectly valid.

d) In Article 1381 (3), the rescissible contract there is a valid contract but in
fraud of creditor. Meaning, the parties intended to be bound by the contract.
If the contract in fraud of creditor is absolutely simulated or fictitious, it is not
merely rescissible but void or inexistent under Article 1409 (2), NCC. If the
contract is indeed rescissible, the proper remedy is an action for rescission
and the action is subject to a 4-year prescriptive period. But if the contract is
absolutely simulated or fictitious, the remedy is an action for declaration of
the absolute nullity of the contract which is imprescriptible.

e) If the court rescinds a contract, the contract is abrogated or unmade, as if

there was no contract that was entered into in the first place. Hence, the
parties are required to mutually restore to each other whatever they received
from the contract.

62. Voidable Contracts:

a) A voidable contract is a valid, enforceable, binding and obligatory between

the parties unless the same is annulled by a final judgment of the court.

 
  

Without a judgment of annulment, the defect of the contract cannot be used

as a defense unless it is by way of a counterclaim. Hence, the defect of a
voidable contract can be raised either as a counterclaim or by filing an action
for annulment of the contract.

b) There are two grounds for the annulment of the contract: (1) if one of the
contracting parties is incapable of giving consent to a contract (Art. 1390 [1],
NCC) but if both parties are incapable of giving consent, the contract
becomes unenforceable under Art. 1403 (3), NCC; (2) If both parties are
capable of giving consent but the consent of one is vitiated by reason of
violence, intimidation, undue influence, fraud or mistake.

c) Unlike a rescissible contract, the defect of a voidable contract can be ratified.

d) If the contract is annulled by the court, the contract is invalidated from the
very beginning. Thus, the parties are required to mutually restore to each
other whatever they received from the contract. However, if the ground is
incapacity of one of the contracting parties, the incapacitated person has no
obligation to restitute unless: (1) to the extent that he is benefited; or (2) if he
kept the thing delivered.

63. Unenforceable Contracts:

a) An unenforceable contract is a valid contract but cannot be enforced in court

unless the defect is ratified. In the absence of ratification, the contract is not
obligatory. But if the defect is ratified, the ratification will retroact to the day
when the contract was entered into, cleansing the contract of its defect from
the very beginning.

b) The defect of the contract is purely a matter of defense, which defense is not
available to third persons. Hence, there is no prescriptive period in relation to
unenforceable contracts.

c) There are three kinds of unenforceable contracts: (1) a contract entered into
by one on behalf of another without authorization, called unauthorized
contracts; (2) a contract that infringes the Statute of Frauds; and (3) a
contract where both the contracting parties are incapable of giving valid
consent.

d) If the contract is unauthorized, or entered into by one on behalf of another

without authorization, the contract is unenforceable generally. Exception: If
the unauthorized contract relates to the sale of a parcel of land, in which
case, the contract is void pursuant to Article 1874 of the Civil Code. Under
this law, if the agency relates to the sale of a parcel of land or any interest
therein, the authority of the agent is required to be in writing; otherwise, the
sale made by the agent is void.

 
  

e) In relation to the Statute of Frauds, bear in mind that there are only three
transactions involving real property covered by the Statute of Frauds: (1) sale
of real property; (2) lease of real property for a period longer than one year
(Art. 1403 , par. 2[e], NCC); and (3) express over an immovable property (Art.
1443, NCC). A real estate mortgage contract, on the other hand, is not
covered by the Statute of Frauds.

64. Void or Inexistent Contracts:

a) A void or inexistent contract does not produce legal effects. Hence, if the void
contract is already performed, generally the law allows recovery of what was
delivered by reason of a void contract. Exception: when recovery is not
allowed ---

§ In Illegal contracts (contracts whose object, cause or purpose is

contrary to law, morals, good customs, public order or public policy)
and both parties are equally at fault, or in pari delicto, the court cannot
come to the aid of any of the parties and will simply leave them where
they are. Hence, no recovery is allowed under the principle of in pari
delicto.
§ When the one recovering is guilty of laches, or he slumbered on his
right for an unreasonable length of time.

b) The defect of the contract can be used either as a defense, if the contract is
still purely executory, or an action for declaration of absolute nullity may be
filed if the contract is already executed for the purpose of recovering what
was delivered. The defense or action based on the absolute nullity of the
contract is imprescriptible (but recovery may be barred by laches).

c) Ordinarily, cause and motive are two different concepts. Cause is the
immediate and proximate reason for entering into a contract while motive is
the remote reason. However, if the motive predetermines the purpose of the
contract, or when the realization of the motive is made as the principal
condition why one will be entering into a contract with the other, then such
motive will also become the cause. In such a case, if the motive is illegal the
contract becomes void.

E. SPECIAL CONTRACTS

65. Sale of Personal Property Thru Installments (Art. 1484, NCC):

PROBLEM: Palces purchased a car from Hyundai through a loan granted by Equitable
Savings Bank. The loan with ESB is payable in several equal monthly installments and
secured by a chattel mortgage over the same car purchased from Hyundai. Palces
defaulted in the payment of the loan prompting ESB to foreclose the chattel mortgage.
After the auction sale, it turned out that the proceeds of the sale were not sufficient to

 
  

cover the indebtedness. May ESB recover the deficiency or is the recovery of the same
barred under Article 1484, par. 3 of the Civil Code?

ANSWER: ESB can still recover the deficiency because Article 1484, par. 3 does not
apply considering the absence of vendor-vendee relationship between ESB and Palces.
Palces never bought the subject vehicle from ESB but from a third party. Instead, Palces
merely sought financing from ESB for its full purchase price. Hence, what was entered
into between the parties is a loan contract with the accessory chattel mortgage contract -
-- and not a contract of sale of personal property in installments. Hence, Article 1484 is
not applicable. Thus, the rights of the parties shall be governed by the Chattel Mortgage
contract, which allows recovery of such deficiency. (Equitable Savings Bank v. Palces
[2016], Perlas Bernabe case)

66. Sale of Real Property Thru Installments (Maceda Law):

a) If the buyer is able to pay installment payments for less than two years, he is
entitled to a grace period of 60 days from default within which to update the
payment, without having to pay interest and penalties. The seller may only cancel
the contract after the expiration of the grace period but the cancellation must be
by way of a notice of cancellation thru notarial act. The contract is then
considered cancelled 30 days from receipt of the notice of cancellation.

b) If the buyer is able to pay installment payments for at least two years, he is
entitled to a grace period of one month for every year of payment. The seller may
only cancel the contract after the expiration of the grace period provided that two
requisites are satisfied: (1) the cancellation is by way of notice of cancellation
thru notarial act; and (2) there must be payment of the corresponding cash
surrender value; otherwise, the contract will still be subsisting. The cash
surrender value is at least 50% of the total payments. However, after five years of
payment, the buyer will be entitled to an additional 5% for every year of payment
after five years, but not to exceed 90% of the total payments.

PROBLEM: AMOSUP entered into a contract under its Shelter Program with one of its
members, Decena, allowing the latter to take possession of a house and lot in Dasma,
Cavite, with the obligation to reimburse AMOSUP the cost thereof in the amount of
US$28,563 payable in 180 equal monthly payment. The contract provides that upon
completion of the payment AMOSUP shall execute a Deed of Transfer and shall cause
issuance of TCT in favor of Decena. The contract also provides that in case Decena fails
to remit 3 monthly reimbursement payments, he shall be give a 3-month grace period,
otherwise the contract is automatically cancelled or revoked without need of demand or
judicial action. From 1995 up to July 1999, Decena had been remitting payments but
from August 1999 up to August 2001 Decena failed to remit 25 monthly installments.
Hence, AMOSUP cancelled the contract and treated all his payments as rentals for his
occupancy of the premises. When Decena refused to vacate, AMOSUP commenced an
ejectment case against Decena.

Q1: Is the Contract between the parties lease or contract to sell?

 
  

ANSWER: The contract is a contract to sell and not a contract of lease. Here, AMOSUP
committed to transfer ownership upon full payment of the price of US$28,563, although
the contract was in the guise of a reimbursement scheme payments which are, in
actuality, installment payments for the value of the house and lot. Considering that the
basis for such occupation is a contract to sell the premises on installments, the
contractual relations between the parties are more than that of a lessor-lessee.
(Associated Marine Officers and Seamen’s Union of the Phil. PTGWO-ITF v.
Decena [2012], Perlas-Bernabe case)

Q2: Is the cancellation of the contract valid?

ANSWER: No. Since the contract to sell involves sale of realty in installments, the
transaction is covered by the Maceda Law, R.A. No. 6552. Under the Maceda Law, if the
buyer has paid at least 2 years of installment payments, the contract can only be
cancelled upon compliance with two requisites: (1) the notice of cancellation or demand
for rescission must be by way of a notarial act; and (2) there must be payment of the
corresponding cash surrender value. Here, there was no payment of the cash surrender
value. Hence, the cancellation is not valid. Therefore the action for ejectment fails.
(Associated Marine Officers and Seamen’s Union of the Phil. PTGWO-ITF v.
Decena [2012], Perlas-Bernabe case)

67. Requisites of Double Sale (Art. 1544, NCC): A double sale exists if the following
requisites are present:

1) There are two or more valid sales;

2) Involving same subject matter;
3) To two or more buyers who do not share same interest
4) By the same vendor (meaning, at the time of the second sale, vendor is still
the owner).

PROBLEM: Rivero, et. al, the original owners of a parcel of unregistered land sold to the
Spouses Roque a portion of lot 18089. The Deed of Conditional Sale provides that a
deed of sale will only be executed upon full payment of the purchase price and upon the
issuance of the certificate of title. The Spouses Roque failed to pay the final installment
of the purchase price. In the meantime, Sabug (one of the sellers) was able to apply for a
free patent over the entire Lot 18089 and was eventually issued OCT. Thereafter, Sabug
sold the entire Lot 18089 to Aguado, who mortgaged the same with the LBP. Because of
Aguado’s failure to pay, the mortgage was closed and eventually transferred in the name
of LBP. The Spouses Roque filed an action for reconeyance. They claimed ownership
because they had been in possession of the property since it was dealt to them by
Rivero, et. al…

Q1: Was the contract in favor of the Sps. Roque a conditional contract of sale or a
contract to Sell?

ANSWER: The contract is actually in the nature of a contract to sell and not a contract of
conditional sale. Where the seller promises to execute a deed of sale upon the

 
  

completion by the buyer of the payment of the purchase price, the contract is only a
contract to sell even if their agreement is denominated as a Deed of Conditional Sale.
(Roque v. Aguado [2014], Perlas-Bernabe case)

Q2: Did the Spouses Roque become the owner of the subject property?

ANSWER: No because they failed to pay the final installment of the purchase price. In a
contract to sell, ownership is retained by the seller and is not pass to the buyer until full
payment of the purchase price. In addition, the sellers have not yet executed a deed of
sale in favor of the buyers. (Roque v. Aguado [2014], Perlas-Bernabe case)

Q3: Was there double sale in this case?

ANSWER: None because one of the two contracts is a contract to sell and not a contract
of sale. In a contract to sell, there is no sale yet. Hence, there is no double sale.

PROBLEM: While pending registration of a parcel of land, the applicant (Dambo) sold
the property to Bentot. The sale was not registered but Bentot took possession of the
property. Subsequently, the OCT was issued in the name of Dambo. Afterwhich a
creditor of Dambo levied upon the property, sold it at auction sale to Berting and the
latter registered the sale. Berting filed an action against Bentot for quieting of title. Is
there double sale? May the action filed by Berting prosper?
ANSWER: There is no double sale under Article 1544 because the prior sale involved
unregistered land. Hence, Article 1544 does not apply. Therefore, the action filed by
Berting cannot prosper because at the time of the levy and auction sale, Dambo was no
longer the owner of the parcel of land because ownership was already acquired by
Bentot. Nemo dat non quod habet.

Q2: What if the land that was sold to Bentot was already registered under the Torrens
system, will your answer be the same?

ANSWER: No. In such a case, Article 1544 will apply. Thus, Berting possessed a
superior right than Bentot provided that he registered the sale in good faith.

68. Equitable Mortgage (Art. 1602, NCC): The contract is presumed “equitable
mortgage” in any of the following cases:

§ Price in pacto de retro is UNUSUALLY INADEQUATE

§ After sale, vendor REMAINS IN POSSESSION
§ After sale, vendor binds himself to PAY TAX on thing sold
§ After expiration of period for repurchase, another period is granted or period
is extended
§ Vendee retains for himself part of purchase price
§ In any instance, WHERE INTENTION IS SECURITY

 
  

PROBLEM: In 2015, Marco entered into a contract of Deed of Sale with Lucio involving a
parcel of land at the price of P500,000. At the time of the transaction, the market value of
the land was P3 M. In another agreement dated 5 days after the sale, captioned
Agreement to Buy Back, Marco was given an option to repurchase the property on or
before December 31, 2016 at the same price plus expenses incurred by Lucio in
transferring the property to his name. Marco remained in possession of the property.
After the period of repurchase, Marco tried to redeem/repurchase the property but Lucio
refused arguing that his ownership over the property becomes absolute. Is Lucio
correct?

ANSWER: No, because the transaction is manifestly equitable mortgage. The contract
shall be presumed to be equitable mortgage when the vendor remains in possession
after the sale or when the price of a sale with right to repurchase is unusually
inadequate. Hence, automatic appropriation of the collateral is invalid as it constitutes
pactum commissorium.

69. Real Estate Mortgage vs. Antichresis:

1) It is the essence of the contract of antichresis that the creditor must be in

possession of the immovable. In real estate mortgage, however, the creditor
is not ordinarily in possession of the immovable but by express agreement of
the parties, the possession may be given to the creditor.

2) What really distinguishes antichresis from mortgage is that in the former,

there must be an express agreement authorizing the creditor to receive the
fruits of the immovable but with the corresponding obligation to apply said
fruits to the payment of interest, if owing, and to the payment of the principal.
Without such express agreement, the contract is merely real estate mortgage.

3) As to formalities: In antichresis, the law requires the amount of the principal

and interest of the loan to be specified in writing; otherwise, the contract of
antichresis is void (Art. 2134, NCC). In real estate mortgage, Article 1358
requires the contract to be in a public document. But the Court ruled that even
if the contract enumerated in Article 1358 is not in a public document, the
same remains valid and enforceable because the requirement of public
document in Article 1358 is neither for validity nor for enforceability, but only
for convenience. In Article 2125, the law requires the contract of real estate
mortgage to be recorded in the registry of property for the purpose of binding
third persons. However, even if not recorded, the same is nevertheless valid
and enforceable between the parties.

Remedy Under Article 1357, NCC: An oral real estate mortgage is valid and
enforceable. However, for the convenience of the parties, they can compel
each other to reduce the contract in a public document under Article 1357
considering that the following requisites of Article 1357 are present: (1) the
contract is already perfected; (2) the contract is valid as to form; and (3) the
contract is also enforceable as to form.

70. Pledge and Chattel Mortgage:

 
  

a) The contract is chattel mortgage when the personal property is recorded in

the chattel mortgage registry. In the absence of such recording, the contract
becomes pledge if the personal property is delivered to the creditor (because
pledge is a real contract, perfected only upon the delivery of the thing
pledged).

b) The contract of pledge can secure future indebtedness; while the contract of
chattel mortgage can only secure existing and present indebtedness.

c) The law does not allow recovery of the deficiency in pledge. In chattel
mortgage, however, the law, as a rule, allows recovery of deficiency.
Exception: Recovery of the unpaid balance of the purchase price is not
allowed in case of foreclosure of the chattel mortgage in sale of personal
property thru installments.

F. QUASI-DELICT

71. PROBLEM: Nicanor, then drunk, entered the EDSA LRT station after purchasing
a token. While standing on the platform, Lito, the security guard assigned in the
area approached Nicanor. A misunderstanding or altercation ensued between the
two that led to a fistfight. Because of their fistfight, Nicanor fell on the LRT tracks
and was struck by the moving train. He was killed instantaneously. Lito is an
employee of Prudent Security Agency hired by the LRTA to provide security
services in the premises.

Q1: If the heirs of Nicanor will sue based on breach of contract, may Lito, Prudent and
LRTA be held solidarily liable? ANSWER: No, because the contract of carriage is only
between LRTA and Nicanor. Lito and Prudent are not parties to said contract.

Q2: Are the heirs of Nicanor bound to prove the fault or negligence of Lito? ANSWER:
No. All they have to prove is the existence of contract between LRTA and Nicanor and
that said contract was breached.

Q3: May LRTA deny liability on the ground that Prudent exercised diligence in selecting
and supervising its employee? ANSWER: No, that defense is available only in quasi-
delict but not if the basis of the action is breach of contract.

Q4: If the basis of recover of civil liability is crime, may Prudent and LRTA be held
solidarily liable with Lito? ANSWER: No. As to LRTA, it will not be liable because Lito is
not its employee. As to Prudent, it may not be held solidarily liable because its liability is

 
  

only subsidiary. It will become liable only when Lito, the one primarily liable, is convicted
and discovered to be insolvent.

Q5: May Prudent put up the defense that it exercised diligence in selecting and
supervising its employee? ANSWER: No. That defense is available only in quasi-delict
but not in delict.

Q6: May the heirs recover based on quasi-delict even if the act of Lito was criminal in
character? ANSWER: Yes, because the scope of quasi-delict is much broader. It also
covers acts and omissions punished by law or criminal in character, whether the crime is
committed negligently or intentionally. That’s why the law prohibits recovery of damages
twice based on the same act or omission if based on delict and quasi-delict (Art. 2177,
NCC).

Q7: May the heirs recover based on quasi-delict even if there was a pre-existing
contractual relation? ANSWER: Yes, because the existence of a contract does not
prevent the recovery of civil liability based on quasi-delict if the act that breaks the
contract is also a tort. Here, the cause of the breach of contract is also a case of quasi-
delict.

Q8: If the heirs will recover based on quasi-delict, may Lito, Prudent and LRTA be held
solidarily liable? ANSWER: Yes, because they are considered joint tort-feasors. While
the liability of LRTA is based on contract while the liability of Lito and Prudent is based
on quasi-delict, a liability for tort may arise even under a contract where tort is that which
breaches the contract. 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. (LRTA v. Navidad [2003])

72. Requisites of Employer’s Vicarious Liability Under Article 2180, NCC:

a) Under our law, whenever an employee’s negligence causes damage or injury to

another, there arises a presumption juris tantum that the employer is also guilty
of negligence, either in the selection of his employee or in the supervision over
his employee, makes the employer liable directly to the victim. This is known as
the vicarious liability of the employer under Article 2180 of the Civil Code, which
is also considered as the proximate cause of the damage or injury suffered.

b) Requisites: In order for the liability of the employer under Article 2180 to attach,
the plaintiff (the victim) must be able to prove two requisites: (1) the existence of
employer-employee relationship; and (2) that the employee was acting within the
scope of his assigned task when the tort complained of was committed. If those
requisites are proven, the employer is presumed liable unless it can prove that it
exercised due diligence in selecting and supervising his employee.

c) Registered owner rule: Registered owners are liable for death or injuries caused
by the operation of their vehicles.

d) Approach when employer happens to be the registered-owner of the vehicle

which caused the damage or injury: The plaintiff must first establish that the

 
  

employer is the registered owner of the vehicle in question. Once the plaintiff
successfully proves ownership, there arises a disputable presumption that the
requirements of Article 2180 have been proven. As a consequence, the burden of
proof shifts to the defendant to show that no liability under Article 2180 has
arisen. (Caravan Travel and Tours, Inc. v. Abejar [2016]) But employer has three
available defenses: (1) it may prove absence of employer emplyee relationship;
(2) it may prove that the time of incident, employee was not acting within the
scope of his assigned task; or (3) that it exercised due diligence in selecting or
supervising its employee.

73. The Enrollment Contract Rule:

a) Applicability of Article 2180, NCC to schools: It applies to all schools,

academic as well as non-academic. Where the school is academic rather
than technical or vocational in nature, responsibility for the tort committed by
the student will attach to the teacher in charge of such student, following the
first part of the provision. This is the general rule. In the case of
establishments of arts and trades, it is the head thereof, and only he, who
shall be held liable as an exception to the general rule. In other words,
teachers in general shall be liable for the acts of their students except where
the school is technical in nature, in which case it is the head thereof who shall
be answerable. (Amadora v. Court of Appeals [1988])

b) However, Article 2180 will only apply if the one committed the quasi-delict
(the assailant) is a student of the school. It does not apply if the one
committed the quasi-delict is not a student of the school. In the latter case,
the basis of the school’s liability will be the enrollement contract. (PSBA v.
Court of Appeals [1992])

c) Under the enrollment contract, schools have the “built-in” obligation of

providing a conducive atmosphere for learning, an atmosphere where there
are no constant threats to life and limb, and one where peace and order are
maintained. Thus, under the enrollment contract, schools have the built-in
obligation to ensure the safety of the student while they are inside the school
premises. (St. Luke’s College of Medicine – William H. Quasha Memorial
Foundation v. Perez [2016]). But the school is not the insurer of its students
against all risks. Thus, the school may still avoid liability by proving that the
breach of its contractual obligations is not due to its negligence. [Id.]

74. For deaths caused by quasi-delict, who may recover moral damages? The
recovery of moral damages is limited to the spouse, legitimte and illegitimate
desvendants, and ascendants of the deceased (Caravan Travel and Tours v.
Abejar [2016])

Question: Reyes was killed when she was hit by the van of Caravan Travel and Tours.
Her paternal aunt, Abejar, filed the action for damages against the driver and its
employer based on quasi-delict. Abejar was the person who raised Reyes since she was
nine years old. Can she recover moral damages for the death of Reyes based on quasi-
delict?

 
  

ANSWER: Yes, because persons exercising substitute parental authority are to be

considered ascendants for the purpose of awarding moral damages. Persons exercising
substitute parental authority are intended to stand in place of a child's parents in order to
ensure the well-being and welfare of a child. The law forges a relationship between the
ward and the person exercising substitute parental authority such that the death or injury
of one results in the damage or prejudice of the other. Given the policy underlying
Articles 216 and 220 of the Family Code as well as the purposes for awarding moral
damages, a person exercising substitute parental authority is rightly considered an
ascendant of the deceased, within the meaning of Article 2206(3) of the Civil
Code. (Caravan Travel and Tours v. Abejar [2016])

Question: Are the surviving brothers and sisters of a passenger of a vessel that sinks
during a voyage entitled to recover moral damages from the vessel owner as common
carrier? ANSWER: No. To be entitled to moral damages, the respondents must have a
right based upon law. It is true that under Article 1003 of the Civil Code the brothers and
sisters succeed to the entire estate of the deceased in the absence of the latters
descendants, ascendants, illegitimate children, and surviving spouse. However, they
were not included among the persons entitled to recover moral damages, as enumerated
in Article 2219 of the Civil Code. (Sulpicio Lines, Inc. v. Curso [2010])

Question: May moral damages be recovered in actions for damages predicated on a

breach of contract? ANSWER: As a general rule, moral damages are not recoverable in
actions for damages predicated on a breach of contract, unless there is fraud or bad
faith. As an exception, moral damages may be awarded in case of breach of contract of
carriage that results in the death of a passenger, in accordance with Article 1764, in
relation to Article 2206 (3), of the Civil Code. In fine, moral damages may be recovered
in an action upon breach of contract of carriage only when: (a) where death of a
passenger results, or (b) it is proved that the carrier was guilty of fraud and bad faith,
even if death does not result. (Sulpicio Lines, Inc. v. Curso [2010])

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GOODLUCK AND GOD BLESS 2019 BAR EXAMINEES!!!