Civ Golden Notes

1 CIVIL LAW NOTES

CIVIL CODE OF THE PHILIPPINES (RA 386, as amended) Aug. 30, 1950 PRELIMINARIES Effectivity of Laws

ADVISER:

7. Tax laws 8. Remedial/procedural XPNS to the XPNS: constitutional limits, where retroactivity would result to: (IE) 1. Impairment of obligation of contracts 2. Ex Post Facto Laws *In case of doubt: Prospective, not retroactive

PERIOD with respect to publication (Art.2) Compliance with the Law

Q: When do laws take effect? A: GR: Laws shall take effect after 15 days following the completion of its publication. XPN: unless otherwise provided (period is specified)  “Unless it is otherwise provided” – 15-day period may be lengthened or shortened.  “after 15 days” – Law shall take effect on the 16th day from date of publication PUBLICATION  Indispensable  Purpose: to inform the public of the passage of the law  Must be in its entirety  Non-publication: violation of due process  Must be in a Newspaper of General Circulation Q: When is a Newspaper considered of General Circulation? A: When it is: 1. Published within the court’s jurisdiction 2. At regular intervals 3. For the dissemination of local news or information 4. With bona fide subscription list of paying subscribers 5. Not devoted to the interest or published for entertainment of a particular class, profession, trade, calling, race, or religious act. RETROACTIVITY Q: What are the exceptions to the rule that Laws have no retroactive effect? A: The exceptions are: 1.When Expressly provided. 2.Penal laws favorable to the accused provided, accused is not a habitual criminal 3. Interpretative Statutes 4. Curative Statutes 5. Laws creating new Rights 6. Emergency Laws 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

“Ignorance of the law excuses no one from compliance therewith.” (Art. 3) - Presumption is: CONCLUSIVE; not rebuttable - Basis: Principle of Necessity and Expediency - Applicable to: Domestic Mandatory or Prohibitory laws Q: Is ignorance of a foreign law a mistake of law or a mistake of fact? A: Mistake of fact. Note: Article 3 is a consequence of the MANDATORY provision on publication Q: Differentiate Mistake of Law from Mistake of Fact. A: Mistake of Fact - Want of knowledge of some fact or facts constituting or relating to the subject matter in hand. - When some facts which really exist are unknown or some fact is supposed to exist which really does not exist. - Good faith is an excuse Mistake of Law - Want of knowledge or acquaintance with the laws of the land insofar as they apply to the act, relation, duty, or matter under consideration. - Occurs when a person having full knowledge of the facts come to an erroneous conclusion as to its legal effects -Not excusable, even if in good faith Q: What is the rule with regard to Difficult Questions of Law? A: – In specific instances provided by law, mistake as to difficult questions of law has been given the same effect as a mistake of fact (e.g. Art. 526 (3) “Mistake upon a doubtful or difficult question of law may be the basis of good faith”)

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Acts or Contracts Contrary to Law Q: What are the exceptions to the rule that Acts or Contracts which are contrary to mandatory or prohibitory laws are void? A: The exceptions are: When the law: 1. Expressly validates or authorizes its validity 2. Makes the invalidity depend on the Will of the injured party 3. Punishes it Criminally but validates the act 4. Invalidates the act but recognizes the Legal effects as flowing from the invalid act. Waiver of Rights

Q: When can there be no waiver of rights? A: If waiver is: 1. contrary to law, public order, public policy, morals or good customs 2. prejudicial to a third party with a right recognized by law *When the act is both a right and a duty, there can also be no waiver Q: What are the requisites of a Valid Waiver of Rights? A: The requisites are: 1. Waiving party must actually have the right he is renouncing. 2. He must have full capacity to make the waiver 3. Waiver must be clear and unequivocal 4. Waiver must not contrary to law, public order, public morals, etc. 5. When formalities are required, they must be complied with. Repeal of Laws

Q: What is the rule on repeal of repealing laws? A: It depends upon how the old law is repealed by the repealing law. IF the old law is Expressly repealed and Repealing law is repealed: the Old law is not revived

Q: What are the requisites of Implied repeal: A: 1) Laws cover the same subject matter 2) Latter is repugnant to the earlier Interpretation of Laws

1. Q: Explain the concept of Stare decisis (Art. 8) - Adherence to judicial precedents - Once a question of law has been examined and decided, it should be deemed settled and closed to further argument. *Courts are required to follow the rule established in earlier decisions of the Supreme Court. *This doctrine, however, however is not inflexible, so that when in the light of changing conditions, a rule has ceased to be beneficial to the society, courts may depart from it. 2. Periods Year – 365 days Month – 30 days Day – 24 hours Nighttime – from sunset to sunrise *Month: if designated by its name: compute by the number of days which it respectively has. *Week: 7 successive days regardless of which day it would start - When computed without reference to the calendar: begins on Sunday; ends on Saturday *Exclude the first, include the last 3. Q: When may Customs be applied to cases by the courts? A: Customs may be applied by the courts in cases where there is: 1. silence 2. obscurity 3. insufficiency of the applicable law in a civil case and provided said customs are not contrary to law, public morals, etc.

BUT IF the old law is Impliedly repealed and Repealing law is repealed: the Old law is revived.

*In a criminal case, customs cannot be applied in the above circumstances because nullum crimen nulla poena sine lege.

Unless otherwise provided in both cases

•

Express Repeal: Law expressly provides for such Implied Repeal: takes place when the provisions of the subsequent law are incompatible or inconsistent with those of the previous law

4. Q: What is the presumption in case there is Doubt in the interpretation or application of laws?

Must be proved as a fact, according to the rules on evidence.

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ADVISER:

A: That the lawmaking body intended right and justice to prevail (Art. 10) Applicability of Laws

Q: What rule governs the ff. types of laws: 1. PENAL Laws Penal laws and laws of public security/safety A: GR: Territoriality Rule (Art. 14) *Obligatory to all who live or sojourn in Philippine Territory XPN: Treaty stipulations, Public International Law principles 2. STATUS Laws Laws relating to family rights and duties, status, condition and legal capacity of persons A: GR: Nationality Rule (Art. 15) *Binding upon citizens of the Philippines, even though living abroad. XPN: 1. When a Filipino citizen and a foreigner is validly married and the alien spouse obtains divorce decree abroad capacitating him/her to remarry, Filipino spouse is also capacitated to remarry under Philippine law. (Art 26, FC); 2. Domiciliary rule applies to stateless persons Rules on Personal Law Basis for determining personal law of an individual DOMICILIARY RULE Domicile

NATIONALITY RULE Citizenship

3. REAL Statutes Laws on Property A: GR: Lex Rei Sitae (Art 16) - Real property as well as personal property is subject to the law of the country where it is situated XPN: Testate/Intestate Succession as to 3 things only: 1. Order of succession 2. Amount of successional rights 3. Intrinsic validity (testate only: this presupposes the existence of a will)

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

*Lex Nationalii applies: National law of the person whose succession is under consideration 4. Laws on forms and solemnities of contracts, will and public documents A: GR: Lex loci celebrationis (Art 17) XPNS: 1. Executed before Philippine diplomatic / consular officials – Philippine laws 2. Prohibitive laws which cannot be rendered ineffective: Ex. a. void marriages under Art 35, FC b. joint wills are never valid in the Phil. Q: What laws govern the making of wills? A: 1. As to extrinsic validity (form) - Art 17 2. As to intrinsic validity (content) – Art 16 Q: Explain the following doctrines: Renvoi Doctrine A: Remission: Where the conflict rules of the forum refer to a foreign law and the latter refers it back to the forum, the internal law of the forum applies. A: Transmission theory: If the foreign law refers it to a third country, the said country’s law governs. • Doctrine of Processual Presumption A: The foreign law, whenever applicable, should be proved by the proponent thereof, otherwise, such law shall be presumed to be exactly the same as the law of the forum. • Doctrine of Operative Facts A: Acts done pursuant to a law which was subsequently declared unconstitutional remain valid, BUT not when the acts are done after the declaration of unconstitutionality. Q: What is the rule on Prohibitive Laws? A: The General rule is that prohibitive laws concerning persons, their acts, or property and laws which have for their object public order, public policy or good customs are not rendered ineffective by laws, judgments promulgated or conventions agreed upon in foreign country. An exception to this rule is Art 26, par. 2 of the FC (on mixed marriages where the foreigner obtained a divorce decree abroad and was thereby

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capacitated to remarry) regarding the nationality principle or lex nationalii. Q: Cipriano and Lady married each other. Lady then left for the US and there, she obtained American citizenship. Cipriano later learned all about this including the fact that Lady Miros had divorced him in America and that she had remarried there. He then filed a petition for authority to remarry, invoking par. 2, Art. 26 of the FC. Is Cipriano capacitated to re-marry by virtue of the divorce decree obtained by his Filipino spouse who was later naturalized as an American citizen? A: Yes. The reckoning point for Art. 26 par. 2 of the FC to apply is not the citizenship of the parties at the time of the celebration of their marriage but their citizenship at the time that a valid divorce is obtained abroad by the alien spouse capacitating him or her to re-marry. Although said provision only provides for divorce obtained abroad by the foreign spouse in a valid mixed marriage, the legislative intent would be rendered nugatory if this provision

would not be applied to a situation where there is a valid marriage between two Filipino citizens, one of whom thereafter is naturalized as a foreign citizen and obtains a valid divorce decree capacitating him or her to remarry, as in this case. To rule otherwise would be to sanction absurdity and injustice. **The clear legislative intent in the case of par. 2, Art. 26 of the FC is to avoid the absurd situation where the Filipino spouse remains married to the alien spouse who, after obtaining a divorce, is no longer married to the Filipino spouse. This is so notwithstanding that, on its face, the said provision does not appear to govern the situation presented by the case at hand. (Republic v. Orbecido III, 472 SCRA 114) Human Relations •

Please refer to notes on Torts and Damages

BOOK ONE PERSONS AND FAMILY RELATIONS PERSONS

CIVIL PERSONALITY Article 37, NCC

JURIDICAL CAPACITY

CAPACITY TO ACT (CTA)

DEFINITION

Fitness to be the subject of legal relations

Power to do acts with legal effect

Inherent (co-exists with the natural person)

Through the fulfillment of specific legal activities

LOSS

Only through death

Through death and other causes

IN RELATION TO THE OTHER

Can exist without capacity to act

Cannot exist w/o juridical capacity

LIMITATION

None

Art. 38, Art. 39, among others

ACQUISITION

Q: What are the restrictions on CTA: Art. 38 A: Minority, Insanity, Imbecility, State of being a Deaf-mute, Prodigality, Civil Interdiction Q: What are the Circumstances that Modify/Limit CTA: Art. 39 A: Age, Insanity, Imbecility, Deaf-Mutism, Penalty, Prodigality, Family Relations, Alienage, Absence, Insolvency, Trusteeship. NATURAL PERSONS (Art. 40-41, NCC) Q: How is PERSONALITY acquired? A: GR: Actual / Permanent Personality

- Personality begins at Birth; not at conception XPN: Presumptive / Temporary - The law considers the conceived child as born PROVIDED: - Only for purposes Beneficial / Favorable to it; and - It is born later in accordance with law. Q: Explain the meaning of the clause: ”Born later in accordance with law”, A: A fetus with an intra-uterine life of: >less than 7 months: Must survive for at least 24 hours after its COMPLETE delivery from the maternal womb

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>At least 7 months: If born alive: considered born, even it dies within 24 hours after complete delivery. Q: Elated that her sister who had been married for five years was pregnant for the first time, Alma donated P100,000 to the unborn child. Unfortunately, the baby died one hour after delivery. May Alma recover the P100,000 that she had donated to said baby before it was born considering that the baby died? Stated otherwise, is the donation valid and binding? Explain. A: The donation is valid and binding, being an act favorable to the unborn child, but only if the baby had an intra-uterine life of not less than seven months and provided there was due acceptance of the donation by the proper person representing said child. If the child had less than seven months of intra-uterine life, it is not deemed born since it died less than 24 hours following its delivery, in which case the donation never became effective since the donee never became a person, birth being determinative of personality. (Bar Question, 1999) Q: How is Civil Personality extinguished? A: GR: Death extinguishes civil personality XPN: unless decedent leaves an estate (Art 43, NCC) Q: Explain the SURVIVORSHIP RULE in Civil Law. A: If in doubt as to who died first between 2 or more persons CALLED TO SUCCEED EACH OTHER, - Burden of Proof: Whoever alleges the death of one prior to the other shall prove the same; - Absent such proof: Presumption: They all died at the same time. There shall be NO TRANSMISSION OF SUCCESSIONAL RIGHTS. Q: What are the presumptions on survivorship? A: When two or more persons who are called to succeed each other, die, they shall be presumed to have died at the same time, subject to the following conditions: 1. Parties are heirs to one another 2. No proof as to who died first 3. There is doubt as to who died first Q: What rule would apply in case there is doubt as to who died first? A: Art. 43 applies when the parties are called to succeed each other. If the parties are not called to 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

ADVISER:

succeed each other, Rule 131, Sec. 3(jj) of the Rules of Court applies. *Both are to be applied only in the absence of facts. JURIDICAL PERSONS (Art. 44, NCC )

Q: What are the diff. kinds of Juridical Persons? A: 1. State and its political subdivisions – governed by the laws creating or recognizing them 2. Public Corporations, institutions and entities – governed by the laws creating or recognizing them 3.Private Corporations, partnerships and associations for private interest or purpose to which the law grants juridical personality – private corporations are governed by BP 68 and partnerships and associations are governed by the provisions of this Code concerning Partnerships. Q: How does CIVIL PERSONALITY cease? A: It depends upon the classification of persons: Natural persons: by Death Juridical persons: by Termination of Existence CITIZENSHIP AND DOMICILE

•

Please refer to notes on Political Law THE FAMILY CODE (Executive Order No. 209) August 3, 1988 I. MARRIAGE

Q: What is Marriage according to the Family Code? A: MARRIAGE is a special contract of permanent union between a man and a woman entered into in accordance with law for the establishment of conjugal and family life. Its nature, consequences and incidents are fixed by law and cannot be the subject of stipulation REQUISITES of MARRIAGE

Q: What are the ESSENTIAL Requisites of marriage: (CC) (Art. 2, FC) A: The essential requisites are: 1. Capacity of parties AGE – at least 18yrs SEX – between male and female LACK OF LEGAL IMPEDIMENTS

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2. Consent freely given in the presence of solemnizing officer

Marriage License

Q: What are the FORMAL Requisites: (Art.3, FC) A: 1. Marriage Ceremony 2. Authority of solemnizing officer 3. Valid marriage License Q: When may proof of age be dispensed with? A: 1) When the parents of the contracting parties appear personally before the local civil registrar and swear to the correctness of their age; 2) When the local civil registrar is convinced, by merely looking at the parties, that they have the required ages; 3) When the party has been married, but is widowed or divorced, or the previous marriage has been invalidated. Q: What constitutes a Marriage Ceremony? A: - Contracting parties appear before the solemnizing officer - With their Personal declaration that they take each other as husband and wife - In the presence of not less than 2 witnesses of legal age Q: Who are Authorized to Solemnize: A: >Any Marriage? o Incumbent Judiciary Member Within the court’s (his) jurisdiction o Priest, Rabbi, Imam or minister of any church/religious sect duly authorized provided at least one of the parties belongs to such church or religious sect. o Consul general, consul or vice-consul provided both parties are Filipinos and marriage takes place abroad. o Mayors (Arts 444 and 445 of LGC) >Marriages In Articulo Mortis? o Ship Captain or airplane chief -During voyage, even during stopovers -Between passengers or crew members o Military commander of a unit -In absence of chaplain -Within zone of military operation -Between members of the armed forces or civilians

Q: May the civil registrar refuse to issue a marriage license because he/she knows of an impediment of one or both of the parties? A: No. In case of any Impediment known to the civil registrar or brought to his attention, he shall note down the particulars thereof and his findings thereon in the application BUT shall nonetheless issue the marriage license UNLESS otherwise ordered by a competent court. Q: When can there be a valid marriage even without the required marriage license? A: Marriages of Exceptional Character (MARCO) a. Marriages among Muslims/members of ethnic cultural communities provided such were solemnized in accordance with their customs, rites and practices (Islamic Law P.D. 1083) b. In Articulo mortis c. In Remote places d. Cohabitation for at least 5 years provided: -No legal impediment -Cohabitation must be characterized by Continuity and Exclusivity *The five-year period of cohabitation must have been a period of legal union had it not been for the absence of marriage e. Marriage solemnized Outside the Philippines where no marriage license is required by the country where it was solemnized. Q: Does the age requirement (18 years old and above) apply also to citizens of a foreign country who wish to marry in the Philippines? A: No. However, when either or both contracting parties are Citizens of a Foreign Country, they should submit first a Certificate of Legal Capacity before they can obtain a marriage license. Q: What is the rule in case a stateless person wishes to contract marriage in the Philippines? A: For Stateless Persons, in lieu of said certificate (cert. of legal capacity), an Affidavit stating the circumstances showing such capacity must be submitted. Q: What are the Authorized Venues of Marriage? A: GR: Must be solemnized publicly within the jurisdiction of the authority of the Solemnizing Officer: 1. chambers of the judge or in open court 2. church, chapel or temple 3. office of the consul-general, consul or vice-consul

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XPNS: 1. marriage at the point of death 2. marriage in remote places 3. marriage at a house or place designated by the parties with the written request to the solemnizing officer Q: What is the status of the marriage in case there is an: *ABSENCE of any of the Essential or Formal requisites? Marriage is VOID AB INITIO *DEFECT in Essential requisites? Marriage is VOIDABLE *IRREGULARITY in Formal requisites? Marriage is VALID, BUT party responsible for such shall be civilly, criminally or administratively liable.

ADVISER:

GR: Marriages solemnized outside the Philippines in accordance with the law of the foreign country where it is celebrated, if valid there, shall be valid here as such. XPN: 1. Lack of legal capacity even with parental consent (e.g. party is below 18) 2. Bigamous or polygamous (except as provided in Art. 41 FC [Terminable Bigamous Marriages]) 3. Contracted through mistake of one party as to the identity of the other 4. Contracted following the annulment or declaration of nullity of a previous marriage but before partition Void due to psychological incapacity Incestuous Void for reasons of public policy NULLIFICATION / TERMINATION Divorce

Q: What Are the other Requirements set forth by law before one can contract marriage? A: If either or both parties are: >18 & above but below 21: Parental Consent >21 & above but below 25: Parental Advice >18 & above but below 25: Marriage Counseling Q: What is the effect if a party who is required by law to obtain Parental Consent failed to do so? A: Marriage is VOIDABLE Q: What is the effect if a party who is required by law to obtain Parental Advice or undergo Marriage Counseling failed to do so? A: Marriage is VALID BUT issuance of marriage license is SUSPENDED for 3 months from the completion of publication of the application for such. Q: What is the status of the marriage if the parties get married within said 3-month period? A: Marriage shall be VOID for lack of marriage license. BUT if they were able to obtain a marriage license within said period, the marriage shall be valid but there may be civil and/or criminal liability. Marriages Solemnized Abroad Q: What is the rule on marriages solemnized abroad? 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

Q: Suppose in a valid mixed marriage (marriage between a citizen of a foreign country and a citizen of the Philippines, the foreign spouse obtained a divorce decree abroad and was capacitated to remarry. May the Filipino spouse remarry despite the fact that divorce is not valid in the Philippines? A: Yes, the Filipino spouse is capacitated to remarry just as the alien spouse is capacitated, Divorce validly obtained abroad by the alien spouse capacitating him/her to remarry will likewise allow the Filipino spouse to remarry. This is the rule laid down in article 26 (2) of the Family Code. Q: Will your answer be the same if it was a valid marriage between Filipinos? A: It depends. What is material in this case is the citizenship of the spouse who obtained a divorce decree abroad at the time the decree was obtained and not their citizenship at the time the marriage was celebrated. If the Filipino spouse was naturalized as a citizen of a foreign country before he/she obtains a divorce decree and was thereafter capacitated to remarry, the Filipino spouse will be capacitated to remarry. However, if the Filipino spouse remained to be a citizen of the Philippines when he/she obtained a divorce decree abroad, such decree will not be recognized in the Philippines even if that spouse is subsequently naturalized as a citizen of a foreign

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country. This is so because at the time the spouse obtained the divorce decree, he/she was still a citizen of the Philippines and being naturalized afterwards does not cure this defect.

* It should be noted however that the foreign spouse must be capacitated to remarry before the Filipino spouse may also be capacitated to remarry.

Q: What are the distinctions between void and voidable marriages? A: DISTINCTIONS

VOID MARRIAGE

VOIDABLE MARRIAGE

NATURE

Non existent from solemnization

Valid until annulled

SUSCEPTIBILITY of CONVALIDATION

Can never be convalidated

Convalidated by cohabitation of parties

PROPERTY

Co-ownership property regime

Absolute Community Property UNLESS other regime was agreed upon

GR: ILLEGITIMATE; CHILDREN

XPNS: Those conceived or born of marriages under Art.36 (Psychological incapacity), or Art 52 in relation to Art 53

Legitimate

HOW IMPUGNED

Directly or collaterally

Only directly

WHO MAY IMPUGN

Anyone who is directly affected

One of the contracting parties

PRESCRIPTIVE PERIOD

Imprescriptible (Art. 39)

Prescriptible; depends on ground

JUDICIAL DECLARATION

Not necessary

Necessary

XPN: in case of remarriage

VOID MARRIAGES

XPT: Marriages of Exceptional Character (MARCO)

Q: What are the marriages that are void ab initio? A: -Art. 35: ABSENCE of any of the Essential or Formal requisites -Art. 35: Subsequent marriages Void under Art. 53 -Art. 36: Psychological Incapacity -Art. 37: Incestuous Marriages -Art. 38: Void by reason of Public Policy > Art. 35: ABSENCE of any of the ESSENTIAL or FORMAL requisites: 1. Lack of CONSENT: Mistake in Identity: Marriages contracted through mistake of one of the parties as to the identity of the other. *Refers to the Physical identity of one of the parties and NOT with regard to merely the character, health, rank, honor or chastity.

3. Lack of LEGAL CAPACITY: a) AGE: Contracted by any party below 18 years old, even with parental consent b) LEGAL IMPEDIMENT: Bigamous or Polygamous Marriages GR: Marriage contracted by any person during the subsistence of a previous marriage is VOID. XPT: Terminable Bigamous Marriage (Art. 41) ~ Before the celebration of the subsequent marriage, the prior spouse has been absent for 4 consecutive years (ordinary absence) or 2 consecutive years (extraordinary absence) and the spouse present has a well-founded belief that the absent spouse is already dead and absent spouse has been judicially declared presumptively dead. *Subsequent marriage will be automatically terminated by the recording of the affidavit of reappearance of the absent spouse.

2. Lack of MARRIAGE LICENSE XPN to the XPN: subsequent marriage is void if spouse present is in bad faith. Good faith or University of Santo Tomas

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ADVISER:

bad faith of the subsequent spouse is immaterial to the validity of the second marriage. 4. Lack of AUTHORITY OF SOLEMNIZING OFFICER – GR: VOID; XPT: If one or both of the parties believed in good faith that said officer had authority to solemnize marriages, VALID. > Art. 35: SUBSEQUENT MARRIAGES VOID under Article 53 of FC *Art. 53: A person whose marriage has been annulled may remarry only after compliance with the requirements provided for in Art. 52, OTHERWISE, the subsequent marriage shall be null and void. *Art. 52 requires that the ff. be recorded in the appropriate civil registry or registries of property: a) Judgment of annulment or absolute nullity; b) Partition and Distribution of the properties of the spouses; and c) Delivery of the children’s presumptive legitimes. *Art. 50 (2): Final judgment shall provide for the ff: 1) Liquidation, partition and distribution of the properties of the spouses; 2) Custody and support of the common children; and 3) Delivery of their presumptive legitimes, Unless such matters had already been adjudicated in previous judicial proceedings. >Art. 36: PSYCHOLOGICAL INCAPACITY Q: What is Psychological Incapacity? A: No exact definition but is restricted to: Psychological incapacity of one of the contracting parties to comply with the essential marital obligations, existing at the time of the celebration of the marriage. Q: What are the requisites for Psychological Incapacity to be a ground for declaration of nullity of marriage? A: (GEM) 1. Grave enough to bring about the disability of the party to assume the essential obligations of marriage 2. Existing at the time of the celebration of the marriage 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

3. Medically or clinically permanent or incurable >Marcos vs. Marcos: Totality of the Evidence Rule i. Juridical Antecedence ii. Gravity iii. Incurability Q: What is the status of children born of marriages under Art. 36? A: Those conceived or born before the decree of nullity of marriage are considered LEGITIMATE (Art. 54) > Art. 37: Incestuous Marriages (Whether legitimate or illegitimate) • •

Between ascendants and descendants of any degree Between brothers and sisters whether of the full or half blood

> Art. 38: Those VOID for reasons of PUBLIC POLICY: Marriages between: • • • • • • • • •

Collateral blood relatives (Legit or Illegit) up to the 4th civil degree Step-parents & step-children Parents-in-law & children-in-law adopting parent & the adopted child surviving spouse of the adopting parent & the adopted child surviving spouse of the adopted child & the adopter adopted child & legitimate child of the adopter adopted children of the same adopter parties where one, with the intention to marry the other, kills the latter’s spouse, or his/her spouse

*List is exclusive

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VOIDABLE MARRIAGES (Art. 45) GROUNDS

Lack of Parental Consent when required by law

Unsoundness of Mind of one spouse (defective consent) *NOTE: if Both spouses are insane, VOID for absence of consent *Presumption: in favor of Sanity

PERSONS WHO MAY SUE

PRESCRIPTIVE PERIOD

RATIFICATION

Party whose parent's consent was not obtained when required by law

Within 5 years after age 21

Free cohabitation as husband and wife -after 21

Parent whose consent was not obtained

Before party whose parent's consent was not obtained when required by law reaches 21

Sane spouse w/o knowledge of the other's insanity

Before death of either party

Relatives/ Guardians/ Persons with legal charge of the insane spouse

Before death of either party

None

Insane spouse

During lucid interval or after regaining sanity

Free cohabitation as H&W -after coming to reason

Incomplete ratification by Prescription (marriage is still voidable but parent is already barred) Free cohabitation as H&W

Free cohabitation as H&W -w/ full knowledge of the facts constituting the fraud Free cohabitation as H&W -when vice of consent (FIU) disappeared or ceased

Fraud (NPSD)

injured party

w/in 5 years from the discovery of the fraud

Vices of Consent (Force; Intimidation; Undue Influence)

injured party

w/in 5 years from the time the vice of consent (FIU) disappeared or ceased

Impotence (Continuous and incurable physical incapacity to consummate the marriage)

Potent party

w/in 5 years after the marriage

Prescription

Healthy party (party w/o STD)

w/in 5 years after the marriage

Prescription

Serious and Incurable Sexually-Transmitted Disease

Q: What are the circumstances constituting FRAUD under Article 45(3)? A: (NPSD) 1. Non-disclosure of Conviction by Final Judgment of crime involving Moral Turpitude 2. Concealment by the wife of the fact that at the time of marriage, she was Pregnant by a man other than her husband 3. Concealment of Sexually Transmitted Disease, regardless of nature, existing at the time of marriage 4. Concealment of Drug addiction, habitual alcoholism, homosexuality and lesbianism

*NOTE: Any other misrepresentation as to character, rank, fortune or chastity is NOT a ground for annulment. *all must exist at the time of the celebration of the marriage Q: When may IMPOTENCE be a ground for annulment of marriage? A: Under Art 45(5) Impotence may be a ground for annulment of marriage provided the ff. requisites concur: (CPUII)

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ADVISER:

1. Impotence exists at the time of the Celebration of marriage 2. Impotence is Permanent (does not have to be absolute) 3. Incurable 4. Impotence is Unknown to the other spouse 5. Other spouse must not also be Impotent Q: What is the Doctrine of Triennial Cohabitation? A: If after 3 years of living together with her husband, the wife remained a virgin, the husband is Presumed to be impotent. Q: When may affliction of a SEXUALLY TRANSMITTED DISEASE be a ground for annulment? A: Under Art 45(6), affliction of STD may be a ground for annulment provided the ff. requisites are present: (SCSIAF) 1. Either party is afflicted with a STD 2. STD must exist at the time the marriage is Celebrated 3. STD must be Serious 4. STD must be apparently Incurable 5. The other spouse must not be Aware of the other’s affliction 6. Injured party must be Free from STD Q: Differentiate articles 45 and 46 of the family code on STD as a ground for annulment. A: ARTICLE 45

ARTICLE 46

AFFLICTION of STD: The fact of being Afflicted is the ground for annulment

CONCEALMENT of having STD: The act of Concealing is the ground for annulment as it constitutes Fraud

Whether concealed or not

There must be concealment

Must be Serious and Incurable

Does not have to be serious and incurable

Q: What are the special cases when subsequent marriage is allowed: A: 1. Marriage between a Filipino and a foreigner and procurement by the alien spouse of a valid divorce decree abroad, capacitating him/her to remarry. 2. Terminable Bigamous Marriages (Art. 41) 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

LEGAL SEPARATION

Q: What are the GROUNDS for Legal Separation? (PALFAC SILA) (Art. 55) 1. Repeated Physical violence or grossly abusive conduct against petitioner, common child, child of petitioner 2. Attempt to corrupt or induce pet, common child, child of pet to engage in prostitution, or connivance in such corruption or inducement 3. Attempt by respondent against Life of pet 4. Final judgment sentencing respondent to imprisonment of more than 6 years *Even if pardoned 5. Drug Addiction or habitual alcoholism of respondent *Must exist AFTER celebration of marriage 6. Physical violence or moral pressure to Compel pet to change religious or political affiliation 7. Bigamous marriage Subsequently contracted by respondent in the Philippines or abroad 8. Sexual Infidelity or perversion 9. Lesbianism/homosexuality of respondent (must exist AFTER celebration of marriage) 10. Abandonment of pet by respondent without justifiable cause for more than 1 year Q: What are the GROUNDS for DENIAL of petition for LS: (CCCCMP-DR) (Art. 56) A: 1. Condonation of act complained of 2. Consent to the commission of the offense/act 3. Connivance in the commission of the act 4. Collusion in the procurement of decree of LS 5. Mutual Guilt 6. Prescription: 5 yrs from occurrence of cause 7. Death of either party during the pendency of the case (Lapuz-Sy vs. Eufemio) 8. Reconciliation of the spouses during the pendency of the case Q: What are the EFFECTS of FILING of petition for Legal Separation? (Art 61) 1. The spouses shall be entitled to live separately from each other 2. In the absence of an agreement between the parties, the court shall designate either the husband or the wife or a 3rd person to administer the absolute community or conjugal partnership property. Q: What are the EFFECTS of DECREE of Legal Separation?

12 2007 Team Bar-Ops Civil Law Committee

A: (Art. 63-64) 1. Spouses entitled to live separately, *marriage bond NOT severed 2. ACP/CPG shall be dissolved / liquidated *BUT offending spouse shall have no right to any share of the net profits earned by the AC/CP which shall be forfeited in accd. w/ art. 43(2). 3. Custody of minor children is awarded to the innocent spouse (subject to Art 213, FC) 4. Offending spouse is disqualified to inherit from innocent spouse by intestate succession 5. Provisions in will of innocent spouse which favors offending spouse shall be revoked by operation of law 6. Innocent spouse may revoke donations he/she made in favor of offending spouse > Prescriptive period: 5 years from finality of decree of LS 7. Innocent spouse may revoke designation of offending spouse as beneficiary in any insurance policy (even when stipulated as irrevocable) Q: What is the purpose of the Mandatory Cooling– off-period? A: The requirement set forth by law that an action for Legal Separation shall in no case shall be tried before 6 months has elapsed since the filing of the petition, is to enable the contending spouses to settle differences. In other words, it is for possible reconciliation. Q: May the heirs of the deceased spouse continue the suit (petition for decree of Legal separation) if the death of the spouse takes place during the pendency of the suit? A: No. An action for legal separation is purely personal, therefore, the death of one party to the action causes the death of the action itself – action personalis moritur cum persona. Setting the decree aside shall be recorded in the proper civil registries.

EFFECTS *Note: S-M = subsequent marriage

of

In both cases: Separation of property and any forfeiture of share already effected SUBSISTS, UNLESS spouses agree to revive former property regime Q: What are the EFFECTS of RECONCILIATION? (Art. 66) As to the Decree: >During the pendency of the case: A: LS proceedings terminated (in whatever stage) >After the issuance of the decree: A: Final decree of LS to be set aside and the order As to the Property Regime: A: GR: With respect to separation of properties, the same shall subsist. XPN: The parties, however, can come into an agreement to revive their previous regime. Their agreement must be under oath and must contain a list of the properties desired to be returned to the community or conjugal property and those which will remain separate, a list of creditors and their addresses. As to capacity to succeed: A: The family code does not provide for the revival of revoked provisions in a will originally made in favor of the offending party as a result of the LS. This absence gives the innocent spouse the right to choose whether the offending spouse will be reinstituted. As to the forfeited shares: A: Those given to the children cannot be returned since the spouses are no longer the owners of such. But those given to the innocent spouse may be returned.

TERMINATION

of

TERMINABLE Bigamous Marriage (Art. 41)

MARR IAGE Declaration of NULLITY

ANNULMENT

Spouses may remarry PROVIDED: Capacity to Remarry

a) Final judgment of nullity from the court;

N/A

b) Compliance w/ art. 52 (JPD)

University of Santo Tomas

Same with declaration of nullity

13 CIVIL LAW NOTES

ADVISER:

GR: ILLEGITIMATE Status of Children

Art 43 (1): Children of the subsequent marriage conceived PRIOR to its termination: LEGITIMATE

XPN: Children born of marriages under arts. 36 (Psych.Inc.) and 53 (Non-comp. w/ art. 52)

Children conceived or born before decree of annulment: LEGITIMATE

considered LEGITIMATE

Property Relations

Art 43 (2): -ACP/CPG shall be dissolved & liquidated. -Share of spouse, who contracted the S-M in Bad Faith, in the net profits of the community property or conjugal partnership, shall be forfeited in favor of the common children, or

same

Same

same

Same

if there are none, the children of the guilty spouse by a previous marriage, or in default of children, the innocent spouse Art 43 (3): Shall remain VALID Donations Propter Nuptias

XPT: a) if donee contracted the S-M in Bad Faith, such donations made to said donee shall be revoked by operation of law. b) if both spouses to the S-marriage acted in bad faith, all donations propter nuptias shall be revoked by operation of law.

Insurance

Art 43 (4): If one spouse acted in Bad Faith, innocent spouse may revoke his designation as beneficiary in the insurance policy even if such designation be stipulated as irrevocable.

same

Same

Succession

Art 43 (5): If one spouse contracted the S-M in Bad Faith, he shall be disqualified to inherit from innocent spouse by testate and intestate succession

same

Same

REPUBLIC ACT 9262 ANTI-VIOLENCE AGAINST WOMEN AND THEIR CHILDREN ACT OF 2004 March 8, 2004 Q: In cases of legal separation, where violence as specified in RA 9262 is alleged, which law shall apply? A: As provided for in sec 19 of RA 9262, Article 58 of the Family Code shall NOT apply. The court shall proceed on the main case and other incidents of the case as soon as possible *Note: W/C = woman or her child Q: What are the acts that constitute the crime of violence against women and their children? (Sec. 5) A: a. Causing, Threatening, Attempting to cause PHYSICAL HARM to the W/C; 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

d. Placing the W/C in Fear of Imminent Physical Harm; e. Attempting to COMPEL/COMPELLING the W/C: 1. to Engage in conduct which the W/C has a right to desist from 2. to Desist from conduct which the W/C has a right to engage in, 3. Attempting to RESTRICT/RESTRICTING the W’s/C’s freedom of movement/conduct by actual/threatened force, physical or other harm, or intimidation directed against the W/C. ~ This shall include, but not limited to the ff. acts committed with the purpose or effect of controlling or restricting the W/C’s movement or conduct: • Actual/Threatened: >Deprivation of: -Custody to his/her family

14 2007 Team Bar-Ops Civil Law Committee

-Financial support legally due her family or deliberately providing the woman’s children Insufficient financial support; -a Legal right; >Preventing the woman from Engaging in any legitimate profession/activity, etc. >Controlling the victim’s own money/properties, >Solely controlling the conjugal or common money/properties; f. Inflicting/threatening to inflict physical harm on ONESELF to control her actions or decision; g. Causing/attempting to cause the W/C to engage in any SEXUAL ACTIVITY (not rape); - by force/threat of force, physical harm, or through intimidation - against the W/C or his/her immediate family h. Engaging in purposeful, knowing, or reckless conduct; - personally or through another; - that alarms or causes substantial emotional/psychological DISTRESS to the W/C. ~This shall include, but shall not be limited to, the ff. acts: 1.stalking or following the W/C in public/private places; 2.peering in the window or lingering outside the residence of the W/C; 3.entering or remaining in the dwelling/property of the W/C against her/his will; 4.destroying property and personal belongings or inflicting harm to animals or pets of the W/C; & 5.engaging in any form of harassment/ violence; i Causing mental/emotional ANGUISH, public ridicule/humiliation to the W/C, including repeated verbal and emotional abuse, and denial of financial support/custody of minor children / access to the W’s children RIGHTS and OBLIGATIONS of SPOUSES Art. 68: ESSENTIAL MARITAL OBLIGATIONS: 1. Live together *Includes Consortium and Copulation 2. Observe mutual love, respect, fidelity 3. Render mutual help and support Arroyo v. Arroyo: ~ GR: Performance of EMO under Art. 68 cannot be compelled by court because it will be a violation of personal liberty. XPN: giving Support Art. 69: Fix the family domicile Art. 70: Jointly support the family Art. 71: Manage the household Art. 72: Not to neglect duties, or commit acts which tend to bring danger, dishonor, or injury to family

Art. 73: Either spouse may practice any legitimate profession/business, even w/o consent of the other. *Other spouse may object on valid, serious and moral grounds. *In case of disagreement, the court shall decide whether: a. the Objection is proper; and b. Benefit has accrued to the family before and after the objection. *The foregoing shall not prejudice right of creditors who acted in good faith Republic vs. CA, Molina: >Exercise the duties and enjoy the rights of parents >Answer for civil liability arising from injuries caused by children below 18 >Exercise parental authority over children’s property PROPERTY RELATIONS Q: What governs the Property Relations of spouses? A: The Property Relations shall be governed by the ff. in the ff. order: 1. Marriage settlement – Future spouses may agree upon the regime of ACP, CPG or complete separation of property or any other regime. 2. Provisions of the Family Code: * Art. 75: ACP shall govern if: a) There is No marriage settlement; OR b) Regime agreed upon is Void 3. Local custom Q: What are the requisites of a VALID MARRIAGE SETTLEMENT? A: 1. In writing 2. Signed by the parties 3. Executed BEFORE the celebration of marriage 4. Registration (to bind 3rd persons) **Must be in accordance with law **The Nature, Consequences, and Effects of Marriage cannot be subject to stipulation Q: What if a party executing the settlement is under Civil Interdiction or any other Disability. Are there any additional requirements for the validity of the marriage settlement? A: Yes, there are additional requirements. The guardian appointed by the court must be made a party to the settlement (Indispensable)

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15 CIVIL LAW NOTES

Q: If a party is required by law to obtain Parental Consent in contracting marriage, is Parental Consent also required for the Marriage Settlement to be valid? A: No. Parental consent is NOT necessary. Q: May a marriage settlement be modified? A: Yes. For any MODIFICATION in the Marriage Settlement to be valid: a) The aforementioned requisites must be present, b) There must be judicial approval c) subject to the provisions of Articles 66, 67, 128, 135, & 136. Art 66: Effects of Reconciliation (Legal Separation) Art 67: Agreement to revive former property regime Art 128: Abandonment w/o just cause: Rights of aggrieved spouse Art 135: Causes for judicial separation of property Art 136: Voluntary dissolution of property regime Q: What laws govern the Property Relations of spouses? (Art. 80) A: GR: Philippine Laws, regardless of place of celebration and residence of spouses XPN: a) Stipulation to the contrary; b) Both spouses are aliens; c) Extrinsic validity of contracts affecting properties situated in a foreign country and: -executed in the country where said property is located; OR -entered into in the Philippines, and the laws of said foreign country require different formalities for its extrinsic validity. Q: What is the EFFECT of NON-CELEBRATION of the Marriage?

ADVISER:

A: GR: Everything stipulated in the settlements or contracts in consideration of the marriage shall be rendered VOID XPN: Those not dependent upon or is not made inconsideration of the marriage SUBSISTS DONATIONS PROPTER NUPTIAS Q: When are Donations considered as Donations by Reason of Marriage? A: When the donation is made (by the future spouses or by third persons) before the celebration of the marriage, in consideration of the same, and in favor of one or both of the future spouses. Q: What are the requisites for DONATIONS PROPTER NUPTIAS? A: The requisites are: that the donation is: 1. Made Before celebration of marriage 2. Made In Consideration of the marriage 3. Made In Favor of one or both of the future spouses Q: What is the rule regarding Donations made: A: > BEFORE Marriage: A: GR: Future spouses cannot donate to each other more than 1/5 of their present property (Excess shall be considered void) XPN: If they are governed by ACP > DURING Marriage: GR: Every Donation or Grant of Gratuitous Advantage, Direct or Indirect, between spouses: VOID XPN: Moderate gifts on the occasion of any family rejoicing Q: Do the aforementioned rules apply to common law spouses? A: Yes.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

16 2007 Team Bar-Ops Civil Law Committee

Prescriptive Period for Filing an Action for REVOCATION of DONATIONS

PROPTER

G R O U N D S (art. 86) 1) Marriage is NOT CELEBRATED (XPT those automatically rendered void by law) 2) M is JUDICIALLY DECLARED VOID XPT: those made in marriage settlements which are governed by Art. 81: Automatic Revocation, UNLESS stipulation does not depend upon celebration of the marriage

GROUND for nullity: a) Subsequent M void pursuant to Art. 40 in re. to 52 and 53: ~ Contracted before prior marriage has been judicially declared VOID b) Grounds other than Art. 40 in re to 52 and 53

NUPTIAS PRESCRIPTIVE PERIOD Real Personal property property 5 yrs from the time the marriage was not solemnized on the fixed date. (art. 1149)

30 yrs

8 yrs from the time possession is lost (art. 1140)

5 yrs from the time the donor came to know that the required parental consent was not obtained.

3) M took place WITHOUT CONSENT OF PARENTS When Required By Law 4) M is ANNULLED and DONEE acted in BAD FAITH

5 yrs

5) Upon LEGAL SEPARATION DONEE being the GUILTY spouse 6) Donation subject to RESOLUTORY CONDITION, and Condition TOOK PLACE 7) DONEE Committed an ACT OF INGRATITUDE Such as: a) Commission of an Offense against the person, honor or property of the donor, his wife or his children under his parental authority b) Imputation to the donor any criminal offense or any act involving moral turpitude UNLESS the crime was committed against the donee himself, his wife or his children under his authority c) Undue refusal to support the donor when he is legally or morally bound to give such support. Matrimonial Property Regimes for Marriage Settlements: Q: What are the different Property regimes? Explain briefly. A: 1. Absolute Community of Property ~ Almost everything is owned in common -XPT: 1. Property acquired during the marriage by gratuitous title and its fruits XPT: if expressly provided by the donor, testator or grantor that they shall form part of the community property 2. Property for personal and exclusive use of either spouse XPT: jewelry (forms part of the ACP)

5 yrs from the time decree of LS has become final 5 years from the happening of the resolutory condition.

1 year from donor’s knowledge of the commission of an act of ingratitude.

3. Property acquired before the marriage by one with legitimate descendants by former marriage and its fruits and income. 2. Conjugal Partnership of Gains ~ Everything Earned during marriage belongs to CP. - XPT those: (OGRE) 1. Brought to the marriage as his/her own; 2. Acquired during marriage by gratuitous title; 3. Acquired by right of redemption, barter, exchange with property belonging to either spouse; OR 4. Purchased with exclusive money of either spouse. 3. Separation of Property ~ may be Partial or Absolute;

University of Santo Tomas

17 CIVIL LAW NOTES

- Spouses contribute to the family expenses PROPORTIONATELY, but liability to the creditors for family expenses is SOLIDARY 4. Any other regime within limits provided by the Family Code SYSTEM OF ABSOLUTE COMMUNITY Applies when the future spouses: 1) Adopt it in a marriage settlement; 2) Do not choose any economic system; OR 3) Adopted a different property regime and the same is Invalid. Q: What consists of the community property? A: GR: The community property consists of all the property owned by the spouses at the time of the celebration of the marriage or acquired thereafter. XPNS: 1. Property acquired during the marriage by gratuitous title and its fruits Except if expressly provided by the donor, testator or grantor that they shall form part of the community property 2. Property for personal and exclusive use of either spouse Except jewelry 3. Property acquired before the marriage by one with legitimate descendants by former marriage and its fruits and income 4. Those excluded by the marriage settlement Q: What about property acquired during the marriage? A: Property acquired during the marriage is presumed to belong to the community Unless proven otherwise by strong and convincing evidence. (Art 93) ADMINSTRATION OF COMMUNITY PROPERTY Q: To whom does the right to administer the community property belong to? A: GR: It belongs to both spouses JOINTLY. XPN: If one spouse is Incapacitated or otherwise Unable to participate in the administration of the common properties: 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

ADVISER:

Capacitated or able spouse may assume SOLE powers of administration BUT such powers do NOT include: Disposition; Alienation; or Encumbrance of the conjugal or community property. Q: In case of Disagreement, whose decision shall prevail? A: The decision of the husband prevails BUT subject to recourse to the court by the wife for proper remedy **Prescriptive period for recourse: - 5 years from the date of the contract implementing such decision. Q: What if the wife failed to bring the action (as recourse) within 5 years? A: This failure makes the husband’s decision final. Q: In cases of alienation, disposition or encumbrance of the community property, and one spouse is incapacitated or unable to participate in the administration of the community property, is the approval of one spouse enough for said alienation, disposition or encumbrance to be valid? A: No. Both spouses must approve any dispositions or encumbrances and consent of the other spouse regarding the disposition must be in writing, otherwise, the matter should be brought to court and the court will give the authority, if proper. Such consent or court approval must be obtained BEFORE the alienation, etc. otherwise, such will be void and obtaining such consent or court approval afterwards will not validate the act. A void act cannot be ratified. Q: What if one spouse acts without the consent of the other or without court approval? A: If one spouse acts without the consent of the other or without court approval, such disposition or encumbrance is VOID. However, the transaction shall be construed as a continuing offer on the part of the consenting spouse and the 3rd person which may be perfected as a binding contract upon acceptance by the spouse or court approval. Q: When may one spouse resort to obtaining court approval for any alienation, encumbrance or disposition of community property? A: In absence of the written consent of the other spouse.

18 2007 Team Bar-Ops Civil Law Committee

Q: Will losses in gambling be charged upon the community property? A: No. Art 95 specifically states that “whatever may be Lost during the marriage in any game of chance, betting, sweepstakes, or any other kind of gambling, whether permitted or prohibited by law, shall be borne by the loser and shall not be charged to the community” However, any Winnings therefrom shall form part of the community property. Q: What are the CHARGES UPON THE ACP: A: (1) The support of the spouses, their common children, and legitimate children of either spouse; (2) All debts and obligations contracted during the marriage by: a) the Designated administrator-spouse for the benefit of the community, or b) by Both spouses, or c) by One spouse WITH the consent of the other; (3) Debts and obligations contracted by either spouse WITHOUT the consent of the other to the extent that the family may have been benefited; (4) All taxes, liens, charges and expenses, including major or minor repairs, upon the community property; (5) All taxes and expenses for mere preservation made during marriage upon the separate property of either spouse used by the family; (6) Expenses to enable either spouse to commence or complete a professional or vocational course, or other activity for self-improvement; (7) Ante nuptial debts of either spouse insofar as they have redounded to the benefit of the family; (8) The value of what is donated or promised by both spouses in favor of their common legitimate children for the exclusive purpose of commencing or completing a professional or vocational course or other activity for self-improvement; (9) Payment, in case of absence or insufficiency of the exclusive property of the debtor-spouse, of: a) Ante nuptial debts of either spouse which did NOT redound to the benefit of the family; b) the support of illegitimate children of either spouse; c) liabilities incurred by either spouse by reason of a crime or quasi-delict, *the payment of which shall be considered as advances to be deducted from the share of the debtor-spouse upon liquidation of the community; and

(10) Expenses of litigation between the spouses UNLESS the suit is found to be groundless. Q: What if the community property is insufficient to cover the foregoing liabilities? A: The spouses shall be solidarily liable for the unpaid balance with their separate propertied. XPT those falling under paragraph (9) Q: May one of the spouses dispose by will a specific community property? A: NO. Art 97 allows only the disposition by way of a will by either spouse, his or her INTEREST in the community property. It is only the Share of the spouse NOT a specific property. Q: What is the rule on donating a community property by a spouse? A: Art 98 provides that Generally, a spouse cannot donate any community property without the consent of the other Except, Moderate donations for charity or on occasion of family rejoicing or distress. Q: If a spouse Abandons without Just Cause his family or Fails to comply with Obligations to the family, what are the Remedies of the Spouse Present? A: Petition the court for: 1) Receivership; 2) Judicial Separation of Property; 3) Authority to be the Sole Administrator of the absolute community Q: What are the EFFECTS of SEPARATION IN FACT: A: 1) ACP is not affected; 2) Spouse who Leaves the conjugal home or Refuses to live therein, without just cause, shall not have the right to be supported; 3) When Consent of one spouse to any transaction of the other is required by law, Judicial Authorization shall be obtained in a summary proceeding. 4) In case of insufficiency of community property, separate property of both spouses shall be solidarily liable for the support of the family. Spouse present shall, upon proper petition in a summary proceeding, be given judicial authority to Administer or Encumber any specific separate property of the other spouse and use the fruits or proceeds thereof to satisfy the latter’s share. Q: How is the ACP terminatied?

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19 CIVIL LAW NOTES

1. 2. 3. 4.

Death Legal separation Annulment Judicial separation of property during marriage

Q: What is the Applicable PROCEDURE IN CASE OF DISSOLUTION OF ACP? A: 1. Inventory of all properties 2. Payment of community debts  First, pay out of the community assets. If not enough, husband and the wife are solidarily liable for the unpaid balance with their separate properties 3. Delivery to each spouse of his/her remaining exclusive properties 4. Equal Division of net community assets Unless there is: a) An Agreement for a Different proportion; OR b) A Voluntary Waiver of such share 5. Delivery of the presumptive legitimes of the children 6. Adjudication of conjugal dwelling and custody of common children Art 103: Upon Termination of marriage by Death, Community property shall be liquidated in the same proceeding for the settlement of the estate of the deceased. If no judicial proceeding is instituted, the surviving spouse shall, judicially or extra-judicially, liquidate the community property within 6 months from the death of the deceased spouse. Q: What if the Surviving Spouse failed to liquidate the community property within 6 months from the death of the deceased spouse contrary to Art. 103 of the Family Code? A: Failure to do so would render any disposition or encumbrance involving community property of the terminated marriage VOID. Q: When is the regime of Complete Separation of Property Mandatory? A: When the surviving spouse contracts a subsequent marriage without compliance with the foregoing requirements, a Mandatory Regime of Complete Separation of Property shall govern the property relations of the subsequent marriage. 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

ADVISER:

CONJUGAL PARTNERSHIP OF GAINS Q: Explain briefly the regime of Conjugal Partnership of Gains. A: It is the property relation formed by the husband and the wife by placing in a common fund the proceeds, product, fruits and income of their separate properties and those acquired by them through effort or chance. It applies only when the future spouses Adopt it in a marriage settlement. Q: What are the EXCLUSIVE PROPERTIES of the Spouses? A: 1. Those brought into the marriage as his/her own 2. Those acquired during the marriage by gratuitous title 3. Those acquired by right of redemption, barter or exchange with exclusive property 4. That purchased with exclusive money of either spouse Q: What CONSTITUTES CPG? A: 1. Those acquired during the marriage with conjugal funds 2. Those obtained from labor, industry, work or profession of either or both spouse 3. Fruits of conjugal property due or received during the marriage and net fruits of separate property 4. Share of either spouse in hidden treasure 5. Those acquired through occupation 6. Livestock in excess of what was brought to the marriage 7. Those acquired by chance Q: What are the CHARGES upon the CPG? A: 1. Support of the spouses, their common children and the legitimate children of either spouse 2. Debts and obligations contracted by one without the consent of the other to the extent that the family benefited 3. Debts and obligations contracted during the marriage by an administrator - spouse, both spouses or one with the consent of the other 4. Taxes, liens, charges, expenses upon conjugal property

20 2007 Team Bar-Ops Civil Law Committee

5. Taxes and expenses for mere preservation of separate property 6. Expenses for professional, vocational or self-improvement courses of either spouse 7. Ante-nuptial debts to the extent the family has been benefited 8. Value of what is donated or promised to common legit children for professional, vocation or self improvement courses 9. Expenses of litigation Q: What are the Rules in Cases of IMPROVEMENT of EXCLUSIVE PROPERTY? A: 1. Reverse Accession - if the cost of the improvement and the additional value is more than the value of the principal property at the time of the improvement, the property becomes conjugal. 2. Accession - if the cost of the improvement and the additional value is equal to or less than the value of the principal property, the entire property becomes the exclusive property of the spouses Q: What are the Steps in the LIQUIDATION of the CPG? A: The steps are: 1. Inventory of all the properties 2. Restitution of advances made to each of the spouses 3. Reimbursement for use of exclusive funds 4. Debts and obligations of the CP are paid 5. Delivery of exclusive properties 6. Payment of losses and deterioration of movables belonging to each of the spouses. 7. Division of the net conjugal partnership 8. Delivery of the children’s presumptive legitimes 9. Adjudication of conjugal dwelling and custody of children ABSOLUTE SEPARATION OF PROPERTY Q: When does ABSOLUTE SEPARATION of PROPERTY Apply? A: It applies when: 1) The future spouses Adopt it in a marriage settlement;

2) ACP or CPG is Dissolved; 3) Prior Marriage is Dissolved due to Death of one spouse and surviving spouse failed to comply with the requirements under Art 103 (judicial or extra-judicial liquidation of ACP within 6 months from death of deceased spouse) Separation of the Property of the Spouses Q: Will the regime of Separation of Property apply even in absence of an express declaration that the spouses are adopting such in the marriage settlement? A: GR: No. In the absence of an express declaration in the marriage settlements, the separation of property between the spouses during the marriage shall not take place. XPN: By judicial order. Judicial separation of property may either be voluntary or for sufficient cause. Q: What are the Sufficient Causes for Judicial Separation of Property? A: 1. Civil interdiction of the spouse of petitioner 2. Judicial declaration of absence 3. Loss of parental authority as decreed by the court 4. Abandonment or failure to comply with family obligation 5. Administrator spouse has abused authority 6. Separation in fact for one year and reconciliation is highly improbable Q: What are the Grounds for the Revival of Former Property Regime? A: When: 1.Civil interdiction of the prisoner-spouse terminates 2.Absentee spouse reappears 3.Court authorizes resumption of administration by the spouse formerly exercising such power 4.Spouse who has abandoned the conjugal home returns and resumes common life with the other 5.Parental authority is judicially restored to the spouse previously deprived thereof 6.Spouses agree to revive their former property regime

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21 CIVIL LAW NOTES

ADVISER:

Q: Distinguish ACP and CPG. A: ACP

CPG

All the properties owned by the spouses at the time of marriage become community property

Each spouse retains his/her property before the marriage and only the fruits and income of such properties become part of the conjugal properties during the marriage

Upon dissolution and liquidation of the community prop what is divided equally between the spouses or their heirs is the net remainder of the properties of the ACP

Upon dissolution of the partnership, the separate property of the spouses are returned and only the net profits of the partnership are divided equally between the spouses of their heirs

Q: Distinguish Art. 147 and 148. A: Property Regime of Unions without Marriage

Art 147

Art 148

No legal impediment to marry

Presence of legal impedimentAdulterous relationships Bigamous/polygamous marriages Incestuous void marriages under Art 37 Void marriages by reason of public policy (Art 38)

Owned in equal shares

Separately owned by the parties

Belongs to party upon proof of acquisition through exclusive funds

Belongs to such party

Governed by rules of co-ownership

Owned in common in proportion to their respective contributions

Applicability

Salaries & Wages Property Exclusively Acquired Property Acquired by Both

Presumption

Forfeiture

Proof of actual contribution

Property acquired while living together presumed obtained by their joint efforts, work or industry and owned by them in equal shares

Contributions to & respective shares over properties owned in common are presumed equal

When only one is in GF, share of party in BF in the co-ownership be forfeited in favor of: 1. their common children 2. innocent party in default of / waiver by any/all common children, or by their descendants

If one of the parties is validly married to another, his/her share in the co-ownership shall accrue to the ACP or CPG existing in the marriage. If the party who acted in BF is not validly married to another or if both parties are in BF, such share be forfeited in manner provided in last par of Art 147

Not necessary

Necessary

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

22 2007 Team Bar-Ops Civil Law Committee

THE FAMILY Family Home (FH) Q: What are the exceptions to the rule that the FH is exempt from execution, forced sale or attachment? A: The Exceptions are: (LTPM) 1. Debts due to laborers, mechanics, architects, builders, material men and others who rendered service or furnished materials for the constitution of the building 2. Non-payment of taxes 3. Debts incurred prior to constitution 4. Debts secured by mortgages on the family home Guidelines: 1. is deemed constituted from the time of actual occupation as a family residence 2. must be owned by the person constituting it 3. must be permanent 4. same rule applies to both valid and voidable marriages and even to common law spouses under Arts 147 and 148 5. it continues despite death of one or both spouses or an unmarried head of the family for 10 years or as long as there is a minor beneficiary

Q: What does Family Relations Include? A: Family relations include relation between: - Husband and wife, - Parents and children, - Among other ascendants and descendants - Among brothers and sisters, full or half blood. Q: Are there any additional requirements in cases of SUITS BETWEEN MEMBERS OF THE SAME FAMILY? A: Yes. It should appear from the verified complaint or petition that earnest efforts towards a compromise have been made but failed. ~ The Allegation of “earnest efforts” is JURISDICTIONAL, if it is absent, the court can dismiss the case Q: When is the aforementioned rule inapplicable? A: It is inapplicable to the following cases: a. Civil status or persons b. Validity of marriage or legal separation c. Any ground for legal separation d. Future support e. Jurisdiction of courts f. Future legitime

PATERNITY AND FILIATION A. Classification of Filiation Kinds 1.Legitimate

General Rule Only those conceived OR born during a valid marriage

2.Illegitimate

Conceived AND born outside a valid marriage Requisites of Legitimation: 1. no legal impediment for parents to marry at time of conception 2. valid marriage subsequent to child’s birth (Please refer to related notes on Adoption laws)

3.Legitimated 4.Adopted

Exceptions 1. conceived as result of artificial insemination PROVIDED: • authorized or ratified by both parents • in a written instrument • executed and signed by them before birth 2. Conceived/born before judgment of absolute nullity under Art 36 has become final & executory 3.Conceived/born of subsequent marriage under Art 53 4.Legitimated

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23 CIVIL LAW NOTES

Children by Artificial Insemination Q: When is a CHILD CONCEIVED BY ARTIFICIAL INSEMINATION considered legitimate? A: A child conceived by said method is considered legitimate if the following conditions are present: 1. The artificial insemination is made on the wife, not on another woman 2. The artificial insemination on the wife is done with the sperm of the husband or of a donor, or both the husband and a donor 3. The artificial insemination has been authorized or ratified by the spouse on a written instrument executed and signed by them before the birth of the child and 4. The written instrument is recorded in the civil registry together with the birth certificate of the child Q: What is the child’s filiation if the marriage is terminated and the mother contracts another marriage within 300 days after the termination of the former marriage? A: In absence of proof to the contrary, these rules shall apply: -If the child is born BEFORE 180 days after the solemnization of the subsequent marriage: ~ It is considered to have been conceived during the FORMER marriage, ~Provided it be born within 300 days after the termination of the former marriage. -If the child is born AFTER 180 days following the celebration of the subsequent marriage: ~ It is considered to have been conceived during such SUBSEQUENT marriage ~ Even though it be born within 300 days after the termination of the former marriage. Q: What rules govern when a child’s legitimacy is impugned? A: The General Rule is that only the husband can impugn the legitimacy of a child. But as an exception to this rule, the heirs of the husband may impugn the child’s filiation in the following cases: 1. If the husband dies before the expiration of period for filing the action 2. If the husband dies after filing without desisting 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

ADVISER:

3. If the child was born after the death of the husband Q: What are the Grounds to Impugn Legitimacy of the Child? 1. Physical impossibility for the husband to have sexual intercourse with his wife within the first 120 days of the 300 days which immediately preceded the birth of the child because of: a. Physical incapacity of the husband to have sexual intercourse with his wife b. The fact that the husband and wife were living separately in such a way that sexual intercourse was not possible, or c. Serious illness of the husband which absolutely prevented intercourse 2.

Proved that for biological or other scientific reasons, the child could not have been that of the husband, except in the case of children conceived through artificial insemination

In case of children conceived through artificial insemination, the written authorization or ratification of either parent was obtained through mistake, fraud, violence, intimidation or undue influence Q: In impugning the legitimacy of the child, what are the Prescriptive Periods? A: 1. One year, from the knowledge of birth or recording in the civil registry, if husband or heirs lives in the same city/municipality 2. Two years, if residing in different city/municipality but within the Philippines 3. Three years, if abroad Q: What are the different kinds of Proof of Filiation? A: Proof of filiation has two kinds: Primary and secondary. The Primary proof consists of the ff: a. Record of birth appearing in civil registrar or final judgment b. admission of legitimate filiation in public document or private handwritten instrument signed by parent concerned The Secondary consists of the ff:

24 2007 Team Bar-Ops Civil Law Committee

a. Open and continuous possession of legitimacy b. Any means allowed by the Rules of Court and by special laws Q: When should an action to claim legitimacy be brought? A: The period of action depends on who is bringing the action: – By the child: during his Lifetime, or – By his heirs: within 5 years should the child die during minority or in a state of insanity Q: What are the rights of Legitimate and illegitimate children? Legitimate Children Bear the surnames of both parents (mother and father) Receive support from parents Legitimate and other successional rights under the Civil Code

Illegitimate Children Bear the surname of either the mother or the father under R.A. 9255 Parental Authority vested in the mother Share is equivalent to ½ of the share of a legitimate child

SUPPORT Q: What is Support comprised of? A: Support comprises of everything indispensable for: 1. Sustenance 2. Dwelling 3. Clothing 4. Medical attendance 5. Education – includes schooling or training for some profession, trade or vocation, even beyond the age of majority 6. Transportation – includes expenses going to and from school, or to from place of work Note: Amount of support shall be in proportion to the means of the giver and to the need of the recipient Q: Who are Obliged to Support Each Other? 1. Spouses 2. Legitimate ascendants & descendants 3. Parents and their legitimate children, and the legitimate and illegitimate children of the latter 4. Parents and their illegitimate children, and the legitimate and illegitimate children of the latter 5. Legitimate brothers and sisters whether full or half-blood

Q: Are brothers and sisters not legitimately related likewise bound to support each other? A: Yes. Brothers and sisters not legitimately related, whether of the full or half-blood, are likewise bound to support each other to the full extent set forth in article 194, EXCEPT only when the need for support of the brother or sister, being of age, is due to a cause imputable to the claimant’s fault or negligence. Q: In what Order does the liability to Support devolve upon those obliged to do so? (SAD-B) A: It devolves upon the following persons in the following order: 1. Spouse 2. Ascendants in the nearest degree 3. Descendants in the in the nearest degree 4. Brothers and sisters PARENTAL AUTHORITY  sum total of the rights of parents over the persons and property of their child Q: What are the Rules as to the Exercise of Parental Authority? A: 1. The father and the mother shall JOINTLY exercise parental authority over the persons of their common children. ~ In case of Disagreement, the father’s decision shall prevail UNLESS there is a judicial order to the contrary 2. If the child is illegitimate, parental authority is with the mother. Q: What is meant by the Parental Preference Rule? A: The natural parents, who are of good character and who can reasonably provide for the child are ordinarily entitled to custody as against all persons. Q: What is the Rule on Parental Authority in case Of Legal Separation of Parents: A: >Parental authority is exercised by the parent designated by the court >GR: No child below 7 years of age shall be separated from the mother >XPN: When the court finds compelling reasons to consider otherwise >The paramount consideration in matters of custody of a child is the welfare and well-being of the child Q: To whom is Substitute Parental Authority vested? A: (GOC)

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25 CIVIL LAW NOTES

1. Surviving Grandparent 2. Oldest brother or sister, over 21 years, unless unfit or disqualified 3. Actual Custodian unless, over 21 years, unfit or disqualified Q: To whom may Special Parental Authority be granted? A: 1. School administrator and teachers 2. Individual entity or institution engaged in child care Q: What are the Distinctions Between Substitute Parental Authority and Special Parental Authority? A: Substitute Special Parental Authority Parental Authority It is exercised in It is exercised concurrently with case of death, the parental authority of the absence, or parents and unsuitability of rests on the theory that while parents. the child is in the custody of Hence, it is not the person exercising exercised by the special parental authority, parents of parental the parents temporarily authority over the relinquish parental authority minor children. over the child to the latter Q: When is Termination of Parental Authority: A: >Permanent? (DED) 1. Death of parents 2. Emancipation of the child 3. Death of child >Temporary? (AGAA-IF) 1. Adoption of the child 2. Appointment of general guardian 3. Judicial declaration of Abandonment 4. Judicial declaration of Absence 5. Incapacity of parent exercising PA 6. Final judgment divesting parents of PA Q: What are the Grounds for Suspension of PA? A: (CHAIN B) 1. Gives corrupting orders, counsel and example 2. Treats child with excessive Harshness and cruelty 3. Subjects/allows child be subjected to Acts of lasciviousness 4. Conviction of crime with penalty of Civil interdiction 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

ADVISER:

5. Culpable Negligence of parent or person exercising PA 6. Compels child to Beg *If the person exercising PA has subjected the child or allowed him to be subjected to Sexual Abuse, he/she shall be permanently deprived of PA. *Parental authority and responsibility are inalienable and may not be transferred and renounced except in case authorized by law *Parents may exercise children’s property

authority

over

their

Q: What are the kinds of Properties of a Minor? A: a. ADVENTITIOUS Characteristics: 1. Earned or acquired by the child through his work or industry by onerous or gratuitous title 2. Owned by the child 3. Child is also the usufructuary, but the child’s use of the property shall be secondary to all collective daily needs of the family 4. Administered by the parents b. PROSFECTITIOUS Characteristics: 1. Property given by the parents to the child for the latter to administer 2. Owned by the parents 3. Parents are usufructuary 4. Property administered by the child REPUBLIC ACT 9255 “AN ACT ALLOWING ILLEGITIMATE CHILDREN TO USE THE SURNAME OF THEIR FATHER” (February 24, 2004) Section 1 – Article v176 of Executive Order No. 209, otherwise known as the Family Code of the Philippines, is hereby amended to read as follows: “Article 176 – Illegitimate children shall use the surname and shall be under the parental authority of their mother, and shall be entitled to support in conformity with this Code. However, illegitimate children may use the surname of their father if their filiation has been expressly recognized by their father through the record of birth appearing in the civil register, or when an admission in public document or private handwritten instrument is made by the father.

26 2007 Team Bar-Ops Civil Law Committee

>Provided, the father has the right to institute an action before the regular courts to prove nonfiliation during his lifetime. The legitime of each

illegitimate child shall consist of one-half of the legitime of a legimate child”

ADOPTION LAWS

(N.B. A.M. # 02-6-02, effective Aug. 22, 2002 - as to the procedural aspect) Domestic Adoption Act of 1998 (RA 8552) 1.Child - person below 18 Definition of 2.Child legally available for adoption - child voluntarily/ terms involuntarily committed to the DSWD, freed of his biological parents, guardians, adopters in case of rescission

Who may adopt

1.Filipino citizen a. of legal age b. in position to care for his children c. good moral character d. full civil capacity & legal rights e. not been convicted of any crime involving moral turpitude f. emotionally & psychologically capable of caring for children g. at least 16 yrs older than adoptee XPNS: i. adopter is the biological parent of adoptee ii. adopter is the spouse of adoptee’s parent 2.Alien a. same qualifications as Filipino b. his country has diplomatic relations w/ the Phil c. has been living in the Phils. for at least 3 continuous yrs prior to the application for adoption & maintains such residence until adoption decree has been entered XPNS: i. when he is a former Fil who seeks to adopt a relative w/in the 4th deg of affinity/consan- guinity ii. one who seeks to adopt the legit/illegit child of his Fil spouse iii. one who is married to a Fil & seeks to adopt jointly w/ his spouse a relative w/in the 4th deg of consanguinity/ affinity of the Fil spouse

Inter-country Adoption Act of 1995 (RA 8043) 1. Child - person below 15 2.Legally-free child – child voluntarily/ involuntarily committed to the DSWD in accordance with the Child &Youth Welfare Code 3.Matching-judicious pairing of child & applicant to promote mutually satisfying parent-child relationship Any alien/Filipino permanently residing abroad if he is: a. at least 27 years & at least 16 yrs older than child to be adopted at the time of application UNLESS adopter is the parent by nature of child to be adopted/spouse of such parent b. if married, his spouse must jointly file for adoption c. has capacity to act/assume all rights &responsibilities of parental authority d. not been convicted of a crime involving moral turpitude e. eligible to adopt under his national law f. in a position to provide the proper care & support & give necessary moral values g. agrees to uphold basic rights of the child (UN convention of rights of child/Phil laws) h. comes from country w/ w/c Phils has diplomatic relations & adoption is allowed under his national law i. possesses all the qualifications & none of the disqualifications under the law/other applicable Philippine laws

3. Guardian - w/ respect to his ward after termination of guardianship & clearance of his financial accountabilities Husband & wife shall jointly adopt XPNS: i. one spouse seeks to adopt the legit child of the other ii. one spouse seeks to adopt own illegit child iii. spouses legally separated

Domestic Adoption Act of 1998 (RA 8552) Who may 1. Any person below 18 who has been administratively/ be adopted judicially declared available for adoption

Inter-country Adoption Act of 1995 (RA 8043) Only a legally-free child may be adopted PROVIDED the FF are submitted

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27 CIVIL LAW NOTES

2. legit child of one spouse by the other spouse 3. illegit child by a qualified adopter to improve the status of said child to that of legitimacy 4. person of legal age, if prior to adoption, said person has been consistently considered & treated by adopters as their own child since minority 5. child whose adoption has been previously rescinded 6.child whose biological parents has died PROVIDED no proceedings has been initiated w/in 6 months from time of death Rescis sion (only available to the adopted)

Grounds:ASAR 1. Attempt on life of adoptee 2. Sexual assault or violence 3. Abandonment & failure to comply w/ parental obligations 4. Repeated physical or verbal maltreatment by adopter Adopter CANNOT rescind decree of adoption but may DISINHERIT adoptee

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Civil Law Committee Chairperson: Vice-Chairperson: Members:

ADVISER:

i. child study ii. birth certificate/foundling certificate iii. deed of voluntary commitment/decree of abandonment/death certificate of parents iv. medical evaluation/history v. psychological evaluation vi. recent photo  No child shall be matched to a foreign adoptive family unless it is satisfactorily shown that the child cannot be adopted locally

1 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

1. BOOK TWO PROPERTY, OWNERSHIP AND ITS MODIFICATIONS 2. PROPERTY Q: What can be considered as property? A: Property comprises all things which are or may be the object of appropriation. Q: What are the requisites to be considered as property? A: Requisites (USA): 1. Utility – capability to satisfy a human need 2. Substantivity/Individuality – independent existence 3. Appropriability – susceptibility to ownership / possession Q: Is property synonymous with thing? A: Technically, thing is broader in scope for it includes both appropriable and non-appropriable objects. Q: What are immovable properties? A: (LaST-MAn-DoC-FM) 1. Land, buildings, roads and constructions of all kinds adhered to the soil; 2. Trees, plants and growing fruits, while they are attached to the land or form an integral part of an immovable; 3. Everything attached to an immovable in a fixed manner in such a way that it cannot be separated therefrom without breaking the material or deterioration of the object; 4. Statues, reliefs, paintings or other objects for use or ornamentation, placed in buildings or on lands by the owner of the immovable in such a manner that it reveals the intention to attach them permanently to the tenements; 5. Machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried on in a building or on a piece of land, and which tend directly to meet the needs of said industry or works; 6. Animal houses, pigeon-houses, beehives, fishponds or breeding places of similar nature, in case their owner has placed or preserved them, with the intention to have them permanently attached to the land, and forming a permanent part of it, the animals in those places are included; 7. Fertilizer actually used on a piece of land; 8. Mines, quarries, and slag dumps, while the matter thereof forms part of the bed, and waters either running or stagnant; 9. Docks and structures which, though floating, are intended by their nature and object to remain at a fixed place on a river, lake or coast; 10. Contracts for public works, and servitudes and other real rights over immovable property. (Article 415)

3.

4.

By Nature – such as lands, roads, mines and quarries, wells and sewers (pars. 1 and 8, Art. 415) regardless of any other consideration. By Incorporation – those which are attached to an immovable in a fixed manner considered as an integral part thereof (par. 1-3, Art. 415) irrespective of its ownership. By Destination – placed in buildings or on lands by the owner of the immovable or his agent in such a manner that it reveals the intention to attach them permanently thereto (pars. 4-7 and 9, Art. 415). By Analogy – classified by express provision of law (par. 10, Art. 415).

Q: Are barong-barongs immovable property? A: No. They are not of a permanent structure, and just mere superimpositions on the land. Q: Where buildings are sold to be demolished immediately, are the buildings immovable or movable? A: A French court has held that the sale involves movable property. What are really sold are the materials. Q: Are trees immovable or movable? A: Real property by NATURE, if they are the spontaneous products of the soil. Real property by INCORPORATION, if they have been planted thru cultivation or labor. Personal property, the moment they are detached or uprooted from the land. EXCEPT in the case of uprooted timber, because timber is an integral part of the timber land. Q: How about ungathered products? A: SC has held that ungathered products have the nature of personal property for purposes of attachment and execution, and for the purposes of the Chattel Mortgage Law. Q: Distinguish Par. 3 from Par. 4 A: PAR. 3 1. Cannot be separated from the immovable without breaking or deterioration 2. Need not be placed by the owner 3. Real property by incorporation

PAR. 4 1. Can be separated from the immovable without breaking or deterioration. 2. Must be placed by the owner of the immovable, or his agent, express or implied 3. Real property by incorporation and destination

Q: What are the requisites for machinery to be considered real property? A: (COTE) 1. The industry or work must be Carried on in a building or on a piece of land. 2. Must be placed by the Owner of the tenement or his agent. 3. Must Tend directly to meet the needs of the said industry or work.

Q: What are the categories of immovable property? A: (NIDA) 2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

2 2007 Team Bar-Ops Civil Law Committee

4.

Must be Essential and principal to the industry or work, and not merely incidental thereto.

certain conditions be the subject of a transaction. (See R.A. 7719 and R.A. 7170)

Q: What happens if the mines, etc. are detached? A: They become minerals and are therefore movable property.

Q: How are properties classified according to ownership? A: (Article 419) 1. Public dominion - property owned by the State (or its political subdivisions) in its public or sovereign capacity and intended for public use. 2. Private ownership – or property owned by: a. The State in its private capacity known as patrimonial property; and b. Private persons, either individually or collectively.

Q: Is glass water immovable? A: No. It is different from “waters” (sea, river, or lake) which is immovable.

Q: In the absence of proof, how is a property to be classified? A: It is presumed to be State property.

Q: What are movable properties? A: (SSOFTS) 1. Those movables Susceptible of appropriation which are not included in Art. 415; 2. Real property which by any Special provision of law is considered as personalty, (ex: growing crops under the Chattel Mortgage Law); 3. Forces of nature which are brought under the control of science; 4. In general, all things which can be Transported from place to place without impairment of the real property to which they are fixed; 5. Obligations and actions which have for their object movables or demandable sums; and 6. Shares of stock of agricultural, commercial and industrial entities, although they have real estate. (Article 416)

Q: What is the purpose of property of public dominion? A: To serve the citizens and not the State as a juridical person.

Q: For purposes of criminal law, how are animals classified? A: They are to be considered as personal property since they may be the object of theft or robbery. Q: Are all kinds of fertilizers immovable? A: No, only if they are actually used.

Q: What are the tests to determine whether it is a movable property? A: (MES) 1. Test of Exclusion - if not found under Art. 415. 2. By reason of a Special law – immovable by nature but movable for the purpose of the special law. Ex: Growing crops for purposes of the Chattel Mortgage Law. 3. Test of Mobility – if the property is capable of being carried from place to place without injuring the real property to which it may in the mean time be attached. Q: Distinguish consumables from fungibles. A: Consumables - those which cannot be used according to their nature without being consumed. (Article 418) Fungibles - those which can be substituted by another thing. Consumability depends upon the nature of the thing itself. A thing may be fungible or non-fungible according to the intention of the parties. Q: Is the human body real or personal property? A: Neither, since it cannot be appropriated. However, the human body or its parts, may, under

Q: What are the kinds of property of public dominion? A: (Article 420) (USD) 1. Those for public Use 2. Those which, without being for public use, are intended for some public Service; and 3. For the Development of the national wealth Q: What are the characteristics of properties of public dominion? A: (ULEPO) 1. Outside the commerce of man . 2. Cannot be acquired by Prescription. 3. Cannot be Levied upon by execution or attachment. 4. In general, they can be Used by everybody. 5. May Either be real or personal property. Q: What is the patrimonial property of the State? A: It is the property not devoted to public use, public service, or the development of the national wealth. It is owned by the State in its private or proprietary capacity. Q: Can property of public dominion be converted to patrimonial property? How? A: Yes, through a formal declaration by the executive or legislative body that the property is no longer needed for public use or for public service. OWNERSHIP Q: How is ownership defined? A: It is a real right to enjoy, dispose, exclude and recover a thing without other limitations than those established by law or the owner himself. Q: What are the kinds of ownership? A: (FNSC) 1. Full ownership – includes all the rights of an owner; Naked ownership + Usufruct 2. Naked ownership – ownership where the rights to the use and to the fruits have been denied; Full ownership - Usufruct

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3 CIVIL LAW NOTES

Q: What is a usufruct? A: Full ownership – Naked ownership 3. 4.

Sole ownership – ownership is vested in only one person Co-ownership – ownership is vested in 2 or more persons.

Asl?Q: What are the rights of an owner?(Elements of Ownership) A: (pufa-vcd) 1. Right to possess 2. Right to use 3. Right to enjoy fruits 4. Right to accessories 5. Right to vindicate or recover 6. Right to consume by its use 7. Right to dispose or alienate Q: What are the limitations on the right of ownership? A: (SLOGcoCo) Those imposed by the: 1. State in the exercise of the power of taxation, police power, and power of eminent domain; 2. Law- ex: legal easements and the requirement of legitime in succession; 3. Owner himself- ex: voluntary easement, mortgage, pledge, and lease; 4. Grantor of the property on the grantee, either by contract (e.g. donation) or by will; 5. Those arising from conflicts of private rights- ex: those which take place in accession continua; 6. Constitution- ex: prohibition against the acquisition of private lands by aliens. Q: What is the so-called Principle of Self help? A: It is the right of the owner or lawful possessor to exclude any person from the actual enjoyment & disposal of the property by the use of such force as may be necessary to repel or prevent threatened unlawful physical invasion or usurpation of his property. (Article 429) Q: What are the requisites of this principle? A: (RONA) 1. Reasonable force 2. by the Owner or lawful possessor 3. with No delay after the dispossession 4. there is Actual or threatened physical invasion or usurpation Q: What happens if there is delay? A: Once delay has taken place, even if excusable, the owner or lawful possessor must resort to judicial process for he is no longer justified in taking the law into his own hands. Q: Can a person interfere with the right of ownership of another? A: GR: No. XPN: Art. 432 based on the doctrine of state of necessity and the principle of the ‘least evil rule’ Requisites (ID): 1) Interference is necessary to avert an imminent danger and a threatened damage to the actor or a 3rd person 2) Damage to another is much greater than the damage to property

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Q: What is a hidden treasure? A: Any hidden or unknown deposit of money, jewelry or other precious objects, the lawful ownership of which does not appear. (Article 439) Q: Is oil or gold hidden treasure? A: No, these are called natural resources. Q: What is the meaning of “other precious objects”? A: Under the ejusdem generis rule, the phrase should be understood as being similar to money or jewelry. Q: What is the rule regarding discovery of hidden treasure? A: GR: If the finder is the owner of the land, building, or other property where it is found, it totally belongs to him. XPNS: If the finder is different from the owner or is a stranger (includes the lessee or usufructuary), he is entitled to ½.

1. 2. 3.

Requisites: (ACTA) Discovery was made on the property of Another, or of the State or any of its political subdivisions; Made by Chance; and He is not a Trespasser or Agent of the landowner. (Article 438 par. 2)

Q: May the State acquire such hidden treasure? A: Yes, in the interest of science or the arts, at a just price to be divided in accordance with the aforementioned rule. (Article 438 par. 3) Q: Why is a trespasser not entitled to any share? A: He cannot be allowed to benefit from his unlawful act. Q: What is the right of the finder employed to look for treasure? A: He has no share in the treasure unless agreed upon. He can only ask for his wage. Q: What is accession? A: It is the right to everything which is produced by the property or which is incorporated or attached thereto, either naturally or artificially. It is not a mode of acquiring ownership but a mere incident of which. Q: Distinguish accession from accessory. A: 1. Accessions are the fruits of, or additions to, or improvements upon, a thing (the principal). Accessories are things joined to, or included with the principal thing for the latter’s embellishment, better use or completion. 2. Accessions are not necessary to the principal thing; the accessory and the principal must go together. Q: What are the classes of accession? A: (DC) 1.Accession Discreta (fruits) (INC) a) Natural – spontaneous products of the soil; the young and other products of animals, whether brought about by scientific means or not.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

4 2007 Team Bar-Ops Civil Law Committee

b) Industrial– produced by lands of any kind through cultivation or labor. c) Civil fruits – derived from the use of property or income from the property itself. They consist of rents of buildings and the prices of leases of lands. (Article 442) 2.Accession Continua (attachment/incorporation) a. with respect to real property (IN) i. accession industrial (building, planting or sowing) ii. accession natural (alluvium, avulsion, change of a river course, and formation of islands) b. with respect to personal property (SAC) i. adjunction or conjunction ii. commixtion or confusion iii. specification Q: To whom do the fruits belong? A: GR: To the owner. (Article 441) XPNS: If the thing is (PULA): 1. in possession of a possessor in good faith (Article 546) 2. subject to a usufruct (Article 566) 3. leased or pledged (Article 1680 and Article 2102, par. 7) 4. in possession of an antichretic creditor (Article 2132) Q: What are the basic principles of accession continua? A: 1. Accessory follows the principal 2. Union or incorporation must generally be effected in such a manner that to separate the principal from the accessory would result in substantial injury to either 3. He who is in good faith may be held responsible but not penalized 4. He who is in bad faith is liable for damages 5. No one shall unjustly enrich himself at the expense of another 6. Bad faith of one party neutralizes the bad faith of the other so that they shall be considered in good faith. 7. To the owner of the thing belongs the extension or increases to such thing RIGHT OF ACCESSION WITH RESPECT TO IMMOVABLE PROPERTY (ARTICLES 445 - 454)

Bad Faith Acquire building etc. after paying value of materials AND indemnity for

OR 2. Be indemnified for value of materials AND damages Bad Faith Lose materials w/o being indemnified AND pay damages

Good Faith Acquire w/o paying indemnity AND right to damages (ART. 449 and 451 by analogy) Bad Faith As though both acted in good faith (in pari delicto)

Bad Faith

2. LAND OWNER IS NOT THE BUILDER, PLANTER OR SOWER LO Good Faith 1. Appropriate improvements after paying indemnity; OR 2. Oblige BP to pay price of the land xpt if its value is considerably greater than the building etc., in which case, BP shall pay reasonable rent, and oblige S to pay proper rent (ART. 448) Good Faith 1. Acquire improvements w/o paying (ART. 449); OR 2. Order demolition or removal of the improvements (ART. 450); OR 3. Compel BP to pay price of the land, regardless of its value, or S to pay proper rent *in all cases, collect damages (ART. 451) AND reimburse BPS for preserving the land (ART. 452) Bad Faith Indemnify BPS for improvements AND pay damages (ART. 454; ART. 447 by analogy)

BPS and OM Good Faith 1. Receive indemnity and B has the right to retain until paid and cannot be required to pay rent; OR 2. BP pay price of the land (or pay reasonable rent) and S pay proper rent Bad Faith 1. Lose improvements w/o being indemnified; OR 2. Remove the improvements; OR 3. BP pay the price of the land S pay proper rent *in all cases, pay damages AND recover reimbursement for preservation of land

Good Faith 1. Receive indemnity for improvements AND receive damages; OR 2. Remove them in any event AND receive damages Bad Faith Bad Faith As though both acted in good faith (in pari delicto) (ART. 453)

Q: What if the building is sold to pay for the value of the land? A: The builder becomes part-owner of the land. 3. LAND OWNER, IMPROVER AND OWNER OF MATERIALS ARE DIFFERENT PERSONS

1. LAND OWNER IS THE BUILDER, PLANTER OR SOWER Land Owner (LO) and Builder, Planter or Sower (BPS) Good Faith Acquire building etc. after paying indemnity for value of materials (ART. 447)

damages, subject to the right of OM to remove

Owner of Materials (OM) Good Faith 1. Remove materials if w/o injury to works, plantings or constructions; OR 2. Receive indemnity for value of materials Good Faith 1. Remove materials, w/ or w/o injury AND be indemnified for damages;

LO Good Faith 1. Acquire improvements and pay indemnity to BPS and be subsidiarily liable to OM for value of materials if BPS has no property; if BPS has paid, pay BPS the value of materials and labor; OR 2. Order demolition or removal of the improvements

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BPS Good Faith 1. Right of retention for necessary and useful expenses AND pay OM for value of materials AND demand value of materials and labor from LO

OM Good Faith 1. Collect value of materials primarily from BPS and subsidiarily from LO if former is insolvent 2. Remove only if w/o injury

5 CIVIL LAW NOTES

(ART. 455) Good Faith *between LO and BPS, ART. 448; ART. 449 by analogy

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Good Faith Not primarily liable for the value of the materials AND w/ a right to damages Bad Faith *beteween BPS and OM, ART. 455

Good Faith *between LO and BPS, ART. 449-452 *between LO and OM, ART. 449 by analogy AND not subsidiarily liable to OM for value of materials Bad Faith Bad Faith Same as though both acted in good faith (in pari delicto) Bad Faith *between LO and BPS, ART. 454 *between LO and OM, ART. 447 Bad Faith ART. 455 *between LO and BPS, ART. 448 *between LO and OM, ART. 447 Good Faith *between LO and BPS, ART. 449-452 1. Answer subsidiarily to OM for value of materials if BPS is insolvent but NOT for damages; OR 2. If BPS is not insolvent, right to damages (ART. 451) Bad Faith *between LO and BPS, ART. 454 *between LO and OM, in pari delicto, ART. 455

Good Faith *between BPS and OM, ART. 455

Bad Faith If not insolvent, primarily liable to OM for value of materials to and pay damages Bad Faith If not insolvent, primarily liable to OM for value of materials and damages

Bad Faith Lose materials w/o right to indemnity AND pay damages Bad Faith

Bad Faith

Good Faith

Good Faith Collect the value of materials AND receive damages

Good Faith Collect the value of materials AND receive damages (ART. 447)

Q: What if the deposits accumulate, not through the effects of the current of the water, but because of the constructions made by the owner purely for defensive purposes against the damaging action of the water? A: The deposits are still deemed to be alluvion and will belong to the riparian owner. Q: What is the effect if all these requisites are present? A: The riparian owner is automatically entitled to the accretion. Q: What are the reasons for granting a riparian owner the right to alluvion deposited by a river? A: 1. to compensate him for: • danger of loss that he suffers due to the location of his land • for the encumbrances and other easements on his land 2. to promote the interests of agriculture as he is in the best position to utilize the accretion. Q: When does the alluvion start to become the property of the riparian owner? A: From the time that the deposit created by the current of water becomes manifest. (Heirs of Navarro v. IAC 268 SCRA 74) Q: Must alluvial deposits be registered? A: Yes, though automatically owned by him. (Heirs of Navarro v. IAC 268 SCRA 74) Q: What is if the riparian owner fails to register the deposits within the prescriptive period? A: The deposits are subject to acquisition through prescription by third persons. (Reynante v. Court of Appeals 207 SCRA 794) Q: Distinguish accretion from alluvium? A: Accretion is the process whereby the soil is deposited while alluvium is the soil deposited.

Good Faith Not primarily liable to OM AND w/ right to damages

Bad Faith Forfeits materials AND pay damages to BPS

Q: What is alluvium or alluvion? A: It is the gradual deposit of sediment by natural action of a current of fresh water, the original identity of the deposit being lost. (Article 457) Q: What are its requisites? A: (MAG) 1. Deposit is gradual and imperceptible 2. Made through the effects of the current of the water 3. The land where the accretion takes place is adjacent to the banks of the river

Q: What is avulsion? A: It refers to the transfer of a known portion of land from one tenement to another by force of the current. (Article 459) Q: What are its requisites? A: (CAP) 1. transfer is caused by the current of a river, creek, or torrent. 2. transfer is sudden or abrupt 3. the portion of the land transported is known or identifiable. Q: What if land from one tenement is transferred to another by forces of nature other than the river current? A: By analogy, can still be considered as avulsion. Q: Who owns the land which has been transferred to another tenement? A: GR: Original owner retains title. XPNS: The land not removed shall belong to the owner of the land to which it has been adjudicated. 1. Abandonment

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

6 2007 Team Bar-Ops Civil Law Committee

2. Expiration of 2 years, whether the failure to remove be voluntary or involuntary, and irrespective of the area of the portion known to have been transferred. Q: Distinguish alluvium from avulsion: A: ALLUVIUM Gradual and imperceptible Soil cannot be identified Belongs to the owner of the property to which it is attached Merely an attachment

AVULSION Sudden or abrupt process Identifiable and verifiable Belongs to the owner from whose property it was detached Detachment followed by attachment

Q: What happens when a river changes its course by natural causes and its bed is formed on a private estate? A: It becomes of public dominion whether it is navigable or floatable or not. Q: What does navigable mean? A: Over which commerce is or may be carried on. Q: How about floatable? A: It means capable of admitting floats. Q: What are the rules on ownership with regard to formation of islands? A: 1. If formed on the seA: a) W/in territorial waters – State b) Outside territorial waters – first country to occupy 2. If formed on lakes or navigable/floatable rivers – State 3. If formed on non-navigable/floatable rivers: a) If nearer in margin to one bank – owner of nearer margin is the sole owner b) If equidistant – island divided longitudinally in halves (Articles 464 -465) RIGHT OF ACCESSION WITH RESPECT TO MOVABLE PROPERTY (ARTICLES 466-475) Q: What is adjunction? A: The process by virtue of which two movable things belonging to different owners are united in such a way that they form a single object and each of the things united preserves its own nature. (Article 466) Q: What are its characteristics? A: (2BUS) 1. 2 movables 2. belonging to different owners 3. united forming a single object 4. separation would impair their nature or result in substantial injury to either thing Q: What are the kinds of adjunction? A: (PEWWS) 1. painting 2. engraftment 3. writing 4. weaving 5. soldering a. ferruminacion - principal and accessory are of the same metal

b. plumbatura – different metals (Article 468) Q: What are the tests to determine which one is the principal? A: (TG-vvm) 1. That to which the other has been united as an ornament, or for its use or perfection 2. That of greater value 3. That of greater volume 4. That which has greater merits Q: How about if the adjunction involves three or more things? A: The court should first distinguish the principal and apply Article 466 in an equitable manner such that the principal acquires the accessory, indemnifying the former owner thereof for its value. Q: A:

When is separation of things allowed? (Article 469) (WAB) 1. separation without injury 2. accessory is more precious than the principal 3. owner of the principal acted in bad faith Q: What are the rules in adjunction? A: Owner of the Principal (OP) Good Faith 1. Acquire accessory and pay OA for its value (Art. 466); OR 2. Demand separation provided no injury (Art. 469) Good Faith Acquire accessory w/o paying and receive damages (Art. 470) Bad Faith 1. Pay value of accessory and pay damages; OR 2. Have the things separated, even though may damage principal and pay damages (Art. 470) Bad Faith Same as though both acted in good faith

Owner of the Accessory (OA) Good Faith 1. Receive payment for value of accessory; OR 2. GR: Demand separation provided no injury XPN: If accessory is more precious than principal, may demand w/ or w/o injury Bad Faith Lose accessory and pay damages Good Faith Receive payment and damages; OR 2. Have accessory separated w/ or w/o injury to principal and receive damages 1.

Bad Faith Same as though both acted in good faith

Q: How is the indemnity made? A: 1. delivery of a thing equal in kind and value; or 2. payment of its price including the sentimental value. (Article 471) Q: What is a mixture? A: It is the combination of materials where the respective identities of the component elements are lost either voluntarily or by chance. (Article 472473) Q: What are the kinds of mixtures? A: (COM-CON) 1. Commixtion – mixture of solids 2. Confusion – liquids Q: What are the rules regarding mixtures? Owner 1 (O1) By Will of Both Good Faith

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Owner 2 (O2) Good Faith

7 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

1. Right is subject to stipulations; OR 2. Right is in proportion to the part belonging to him (Coownership arises) Art. 472 By Will of Only 1 Owner/ By Chance Good Faith 1. Have things separated provided no injury; OR 2. If cannot be separated w/o injury, acquire interest on mixture in proportion to his part (co-ownership) Art. 473 Bad Faith (caused the mixture) Lose his part on the mixture and pay damages to O2 Bad Faith As if both in gf, because the owner in gf was the one who caused the ratification,

1. Same; OR 2.Same

2.

Good Faith Same; OR Same

Good Faith Acquire entire mixture and receive damages Good Faith (caused the mixture) in a way, it’s a ratification.

Q: What is specification? A: It is giving new form to another’s material through the application of labor (labor is the principal) (Article 474) Q: What are the rules regarding specification? A: Art. 474 Maker (M) Good Faith Appropriate thing transformed and pay OM for value of materials If Material is more precious than the Thing transformed Good Faith 1. Receive payment for value of his work; OR 2. Appropriate new thing and pay OM Bad Faith 1. Lose new thing and pay damages to OM; OR 2. Pay value of material and damages to OM

1.

Owner of Materials (OM) Good Faith Receive payment for value of materials

Good Faith Appropriate new thing and pay M for the work; OR 2. Receive payment for materials Good Faith 1. Appropriate new thing w/o paying and receive damages (not available if new thing is more valuable than materials for scientific or artistic reasons) ; OR 2. Receive payment for value of materials and damages 1.

QUIETING OF TITLE (ARTICLES 476- 480) Q: What is an action to quiet title? A: -It is an action for the purpose of putting an end to vexatious litigation in respect to the propertyinvolved. -A suit quasi in rem, an action in personam concerning real property where judgment therein is enforceable only against the defeated party and his privies. Q: What is a cloud on title? A: It is a semblance of title, either legal or equitable, or a claim or a right in real property, appearing in some legal form but which is, in fact, invalid or which would be inequitable to enforce. Q: What are the requisites for existence of a cloud? A: (ATP)

3.

There is an apparently valid or effective instrument. But such instrument is in truth invalid, ineffective, voidable, or unenforceable, or has been extinguished or terminated, or has been barred by extinctive prescription. Such instrument may be prejudicial to the title.

Q: What are the requisites for an action to quiet title? A: (LCDR) 1. Plaintiff must have a legal or equitable title to, or interest in the real property which is the subject matter of the action; 2. There must be a cloud in such title; 3. Such cloud must be due to some instrument, record, claim, encumbrance or proceeding which is apparently valid but is in truth invalid, ineffective, voidable or unenforceable, and is prejudicial to the plaintiff’s title; and 4. Plaintiff must return to the defendant all benefits he may have received from the latter or reimburse him for expenses that may have redounded to his benefit. Q: What is legal title? A: It consists in full or naked ownership which is registered in the name of the plaintiff. Q: What is equitable title? A: It refers to the beneficial interest in the property the legal title of which belongs to another. Q: What are the prescriptive periods? A: 1. Plaintiff in possession – imprescriptible 2. Plaintiff not in possession – 10 years (ordinary) or 30 years (extra-ordinary) Q: What if the action is filed within the period of limitations, may it still be barred? A: Yes, by laches. (See Articles 1431, 1433, 1437) Q: What is the purpose of an action to remove cloud? A: It is intended to procure cancellation, delivery of, release of an instrument, encumbrance, or claim constituting a claim on plaintiff’s title, and which may be used to injure or vex him in the enjoyment of his title. Q: Differentiate an action to quiet title from an action to remove cloud on title. A: ACTION TO QUIET TITLE 1. purpose is to put an end to troublesome litigation in respect to the property involved 2. a remedial action involving a present adverse claim

ACTION TO REMOVE CLOUD ON TITLE 1. for the removal of a possible foundation for a future hostile claim 2. A preventive action to prevent a future cloud on the title

CO-OWNERSHIP Q: What is co-ownership?

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

8 2007 Team Bar-Ops Civil Law Committee

A: It is that state where an undivided thing or right belongs to two or more persons. (Article 484) Q: What are its requisites? A: (POL) 1. Plurality of owners 2. Object of ownership must be a thing or right which is undivided 3. Each co-owner’s right must be limited only to his ideal share of the physical whole Q: What are the sources of co-ownership? A: (DOCSFL) 1. Contract 2. Law - ex. easement of party walls (Article 658) 3. Succession- ex. heirs of undivided property before partition 4. Donation inter vivos or mortis causa -ex. where the donor prohibits partition of the property for a certain period of time 5. Fortuitous event or by chance - ex. hidden treasure 6. Occupancy - ex. when two persons gather forest products. Q: Distinguish co-ownership from joint tenancy A: Co-ownership Joint Ownership (Tenancy in common) (Joint Tenancy) 1. Each co-owner is the owner of his own ideal share. 2. Each co-owner may dispose of his undivided share WITHOUT the other co-owners’ consent. 3. Upon the death of a coowner, his ideal share goes to his heirs. 4. In case of a minor who is a co-owner, this does not benefit the others; prescription will continue to run against them

1. Each joint owner owns the whole thing. 2. Joint owner must obtain the consent of all the rest. 3. Upon the death of a joint owner, his share goes to the other joint owners by accretion. 4. The legal disability of one joint owner benefits the others; prescription will not run against them.

Q: Distinguish co-ownership from partnership. Co-ownership Partnership (ordinary) 1. 2. 3. 4.

No legal personality By contract, will, etc. For collective enjoyment Agreement to exist for more than 10 years is void 5. No mutual representation

1. 2. 3. 4.

W/ legal personality By contract only For profit No term limit set by law

5. There is mutual representation 6. Dissolved by death or incapacity of a partner

6. Not dissolved by the death/incapacity of a coowner 7. A co-owner can dispose of 7. A partner cannot be his share w/o the consent substituted w/o the of the others consent of the others 8. Profits of a co-owner 8. Profits may be depend on his stipulated upon (for proportionate share e.g., profit-sharing agreements)

Q: What are the rights of each co-owner as to the thing owned in common? A: (USACOPEP)

1.

To use the thing according to the purpose intended provided that: a. It is w/o prejudice to the interest of the coownership; and b. W/o preventing the use of other co-owners. (Art. 486) 2. To share in the benefits in proportion to his interest, provided the charges are borne in the same proportion. (Art. 485) 3. Each co-owner may bring an action in ejectment. (Art. 487) 4. To compel other co-owners to contribute to expenses for preservation of the thing(Art. 488) To oppose to any act of alteration (Art. 491) 6. To protect against acts of majority which are prejudicial to the minority (Art. 492, par. 3) 7. To exercise legal redemption 8. To ask for partition (Art. 494) Q: May benefits be distributed according to stipulations in a contract and not in proportion to their interests? A: No. A contrary stipulation is void. It is contrary to the essence of co-ownership. Q: What if the co-ownership is created other than by a contract (by will or donation)? A: The share of the co-owners need not be proportionate to their respective interests. Q: What does an action in ejectment cover? A: (FURRPQ) a. Forcible entry b. Unlawful detainer c. Accion publiciana d. Accion reinvindicatoria e. Quieting of title f. Replevin Q: When one co-owner brings an action, does it benefit the others? A: Yes, it is deemed instituted for the benefit of all. Q: But if the case does not prosper, are the other co-owners bound by the judgment? A: GR: No. XPN: They were also served with summons, even as unwilling plaintiffs. Q: Can it be brought by one co-owner against another co-owner? A: No, since the latter has a right to possess; the only effect of the action will be to obtain recognition of the co-ownership. Q: What are the expenses which the co-owners can be compelled to contribute? A: Only necessary expenses. Useful expenses and those for pure luxury are not included. Q: When may acts of preservation be made? A: At the will of one of the co-owners, but he must, if practicable, first notify the others of the necessity of such repairs. Q: Who shall decide regarding expenses for the improvement or embellishment of the thing?

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9 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

A: The majority co-owner representing the controlling interest in the object of the coownership. (Article 489)

3. pay for the loss and damages the community property or other co-owners may have suffered.

Q: May a co-owner opt not to contribute? How? A: GR: Yes, by renouncing his undivided interest equal to the amount of contribution. XPN: If the waiver or renunciation is prejudicial to the co-ownership. (Article 488)

Q: Whose shares may a co-owner redeem? A: The shares of all or any other co-owner if sold to a third person.

Q: Is the failure or refusal of a co-owner to contribute pro rata to his share of expenses tantamount to renunciation? A: No. Q: What is the nature of said renunciation? A: It is in effect a dacion en pago since there is a change of the object of the obligation (i.e. sum of money to interest in the co-ownership). Hence, the consent of the other co-owners is necessary. Q: Can the renunciation be made without the consent of any unpaid creditor? A: No, for it is in effect a novation by substitution. Q: Distinguish acts of administration from acts of alteration. A: ACTS OF ADMINISTRATION 1. Refer to the enjoyment, exploitation, alteration of the thing w/c do not affect its substance, form, or purpose

2.

Transitory in character 3. Do not affect the substance or form 4. In relation to the right of a co-owner, they require the consent of the majority 5. Can be exercised by the co-owners through others

ACTS OF ALTERATION 1. Acts, by virtue of w/c, a coowner, in opposition to the expressed or tacit agreement of all the co-owners, and in violation of their will, changes the thing from the state in which the others believe it would remain, or withdraws it from the use to which they believe it is intended 2. Permanent 3. Relates to the substance or essence of the thing 4. Requires the consent of ALL co-owners

5. Must be exercised by the coowners themselves

Q: Is alteration limited to physical or material changes to the thing? A: No, but includes any act of ownership. Q: What is the reason for requiring the consent of the other co-owners? A: Because alteration is an act of ownership and not of mere administration. Q: What is the liability of a co-owner who makes an alteration without the express or implied consent of the others? A: He shall: (LDP) 1. lose what he has spent; 2. be obliged to demolish the improvements done; and

Q: What if the price of the alienation is grossly excessive? A: The redemptioner shall pay only a reasonable one. Q: What if 2 or more co-owners want to redeem? A: They may do so in proportion to the shares they may respectively have. Q: When does an action to request partition prescribe? A: It does not, as long as the co-ownership exists. Q: What are the XPNS to the right to demand partition? A: (CLIPUT) a. When the co-owners agree to keep the property undivided for a period of time but not > 10 yrs b. Prohibited by the transferor (donor/testator) but not > 20 yrs c. Prohibited by law by reason of their origin or juridical nature- ex. party walls and fences d. When a co-owner possessed the property as an exclusive owner for a period sufficient to acquire it through prescription e. When partition would render the thing unserviceable or the thing is essentially indivisible Q: Does the law favor co-ownership? A: No, it is not conducive to the development of the community property esp. when it involves real property. Q: Is there a permanent renunciation of the right to ask for partition? A: No, such is VOID. Q: Can prescription run in favor of or against a coowner? A: GR: No, so long as he expressly or impliedly recognizes the co-ownership because the possession of one co-owner is not adverse to the others. XPN: If the co-owner repudiates the coownership, in w/c case, prescription begins to run from the time of repudiation. ex. of acts of repudiation- filing of an action to quiet title or recovery of ownership Q: Should creditors and/or assignees be notified of the proposed partition? A: The law does not expressly provide that a notification be given but: 1. If notice is given- it is their duty to appear to concur /oppose 2. If no notice- creditors and/or assignees may still question the partition made

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

10 2007 Team Bar-Ops Civil Law Committee

Q: Can a partition already executed or implemented be still impugned? A: GR: No. XPNS: 1. Existence of fraud, notified or not and whether or not they opposed 2. Partition was made over their objection even if no fraud (Article 497) Q: What are those rights not affected by partition? A: (MRS.P) 1. Rights of: 1. mortgage 2. servitude 3. any other real rights existing before partition 2. Personal rights pertaining to third persons against the co-ownership (Article 499) Q: What are the remedies when the thing is essentially indivisible? (Article 498) A: (AS) 1. Co- owners may agree that it be allotted to one of them who shall indemnify the others; OR 2. If they cannot agree, may sell the thing and distribute the proceeds Q: What are the obligations of co-owners upon partition? A: (WARD) 1. Mutual accounting for benefits received, fruits and other benefits 2. Mutual reimbursements for expenses 3. Indemnity for damages caused by reason of negligence/fraud 4. Reciprocal warranty for defects of title and quality of the portion assigned to the co-owner (Articles 500-501) Q: How is co-ownership extinguished? A: (CALSTEP) 1. Consolidation or merger in one co-owner 2. Acquisitive prescription in favor of a third person or a co-owner who repudiates 3. Loss or destruction of thing co-owned 4. Sale of thing co-owned 5. Termination of period agreed upon 6. Expropriation 7. Judicial or extra-judicial Partition

Q: What are common areas? A: The entire project excepting all units separately granted or held or reserved. Q: What is the effect of any transfer of a unit? A: It includes the transfer of the undivided interest in the common areas or, in a property case, the membership or shareholdings in the condominium corporation. Q: Where the common areas in the condominium are held by the owners of separate units as coowners thereof, to whom can the units therein be conveyed? A: GR: Only to Filipino citizens. XPN: In cases of hereditary succession. Q: Can the common areas be divided? A: GR: No, there can be no judicial partition. XPNS: A partition shall be made only upon a showing: (COURE) A. That 3 yrs after damage to the project which rendered a material part thereof unfit for its use prior thereto, it has not been Repaired substantially to its state prior to said damage; or B. That damage to the project has rendered 1/2 or more of the units therein Untenantable and owners holding in aggregate > 30% interest in the common areas are opposed to the repair; or C. That the project has been in existence for > 50 yrs, Obsolete and uneconomic, and owners holding in aggregate > 50% interest in the common areas are opposed to the repair or modernizing; or D. That the project or a material part thereof has been condemned or Expropriated, the project is no longer viable and owners holding in aggregate > 70% interest in the common areas are opposed to continuation of the condominium after such expropriation or condemnation; or E.That the Conditions for such partition by sale have been met. POSSESSION Q: What is possession? A: It is the holding of a thing or the enjoyment of a right. (Article 523)

THE CONDOMINIUM ACT (R.A. No. 4736, as amended) Q: What is a condominium? A: An interest in real property consisting of a separate interest in a unit in a residential, industrial or commercial building and an undivided interest in common, directly or indirectly, in the land on which it is located and in other common areas of the building. Q: What is a unit? A: Any part of the condominium project intended for any type of independent use or ownership. Q: What is a project? A: The entire parcel of real property divided or to be divided in condominiums, including all structures thereon.

Q: Which may be the object of possession? A: Only things and rights which are susceptible of being appropriated may be the object of possession. (Article 530) Q: What are the elements or requisites of possession? A: (HIP) 1. Holding or control of a thing or right 2. Deliberate Intention to possess (animus possidendi) 3. Possession by virtue of one’s own right Q: What are the degrees of possession? A: (NJurJusSim)

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11 CIVIL LAW NOTES

1. Possession w/ no right/title- possessor knows that his possession is wrongful, e.g. possession of a thief or a usurper of land 2. W/ juridical title- possession peaceably acquired and will never ripen into full ownership as long as there is no repudiation of the concept under which property is held. ex. possession of a tenant, depositary, agent. 3. W/ just title or title sufficient to transfer ownership, but not from the true owner- ripens to full ownership by the lapse of time. ex. The possession of a buyer of a piece of land from one who pretends to be the owner thereof. 4. W/ a title in fee simple- springs from ownership; highest degree of possession.

5. 6.

Q: What are the classes of possession? A: (OVALCGHBC) 1. In one’s Own name – possessor claims the thing for himself 2. In the name of Another – held by the possessor for another 3. Voluntary – by virtue of an agreement 4. Legal – by virtue of law; ex. possession in behalf of incapacitated 3. In the Concept of an owner – possessor, by his actions, is believed by others as the owner, whether he is in good or bad faith 4. In the concept of a Holder – possessor holds it merely to keep or enjoy it, the ownership pertaining to another; ex. usufructuary Possession in Good faith Possession in Bad faith 7. Constructive possession- does not mean that a man has to have his feet on every square meter of ground. Q: What is a possessor in good faith? A: One who is not aware that there exists in his title or mode of acquisition any flaw which invalidates it. (Article 526) Q: What is a possessor in bad faith? A: One who is aware that there exists in his title or mode of acquisition any flaw which invalidates it. Q: When is good or bad faith material? Immaterial? A: It is important in connection to the receipt of fruits, indemnity for expenses, and acquisition of ownership by prescription. It becomes immaterial when the right to recover is exercised. (Article 539) Q: What are the requisites to constitute possession in good faith or in bad faith? A: 1. possessor has a title/mode of acquisition 2.there is a flaw or defect in said title/mode 3.the possessor is aware or unaware of the flaw or defect Q: What is mistake upon a doubtful or difficult question of law? May it be the basis of possession in good faith? A: It refers to the honest error in the application or interpretation of doubtful or conflicting legal

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

provisions/doctrines, and not to the ignorance of the law. (Article 526, par. 3) Q: What are the rights of a possessor? A: Good Faith Bad Faith As to fruits received Entitled while possession Reimburse fruits received is in good faith or w/c lawful possessor would have received As to pending fruits Liable w/ lawful No right possessor for expenses of cultivation and shall share in net harvest to time of possession As to expenses (Necessary expenses) Right of reimbursement Right of reimbursement and retention (Useful expenses) Right of removal None Deterioration/Loss No liability, unless due to Always liable his fault/negligence

Q: What are the ways of acquiring possession? A: (FAMS) 1. By material occupation/exercise of a right 2. By subjection of the thing/right to our will 3. By proper acts and legal formalities established for acquiring such right (Article 531) Q: What if the decedent was in bad faith, will the heir suffer the consequences of the wrongful possession? A: No, bad faith is personal to the decedent and is not deemed transmitted to the heirs.The heir suffers such consequences only from the moment he becomes aware of the flaws affecting decedent’s title. The effects of good faith of the heir should be counted only from the date of decedent’s death. (Article 534) Q: What are the acts which do not give rise to possession? A: (VFAT) 1. Force or intimidation as long as there is a possessor who objects thereto (Article 536) 2. Acts executed clandestinely and without the knowledge of the possessor which means that: a. acts are not public b. unknown to the owner or possessor 3. Mere Tolerance by the owner or the possessor. 4. Acts executed by Violence. (Article 537) Q: Why do acts merely tolerated not give rise to ownership? A: Because it is not adverse and therefore, no matter how long continued, cannot ripen to ownership by prescription. Q: What are the rules in case of conflict of possession? A: (A2DE) 1. Present/actual possessor shall be preferred

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

12 2007 Team Bar-Ops Civil Law Committee

2. 3. 4.

If there are 2 possessors, the one longer in possession If the dates of possession are the same, the one with a title If all the above are equal, the fact of possession shall be judicially determined, and in the meantime, the thing shall be placed in judicial deposit. (Article 538)

Q: What are the rights of every possessor? A: (RPR) 1. to be respected in his possession 2. to be protected in said possession by legal means 3. to secure in an action for forcible entry the proper writ to restore him in his possession (Article 539) Q: What kind of possession can serve as a title for acquiring dominion? A: Only the possession acquired and enjoyed in the concept of owner. (Article 540) Q: Is payment of taxes proof of ownership? A: Yes, payment of realty tax coupled with actual possession in the concept of an owner is a positive indicium of claim of ownership. (Republic v. CA 258 SCRA 712) Q: What are the different kinds of title? A: (CPJ) 1. Just title - sufficient to transfer ownership w/o the need of possessing the property for a period necessary for acquiring title by prescription. The title is true and valid. (titulo verdadero y valido) 2. Colorable title (titulo colorado) - one which a person has when he buys a thing in good faith from one who is not the owner but whom he believes to be the owner. 3. Putative title (titulo putativo)- one which a person believes he has, but in fact he has not because there was no mode of acquiring ownership as when one is in possession of a thing in the mistaken belief that it had been bequeathed to him. Q: When are fruits considered received? A: (Article 544) 1. Natural and industrial fruits - from the time they are gathered or severed 2. Civil fruits - from the time of their accrual and not their actual receipt. Q: What if there are natural or industrial fruits at the time good faith ceases? A: The possessor shall share in the expenses of cultivation, net harvest, and charges in proportion to the time of possession. (Article 545) Q: What are the options of the owner in case there are pending fruits at the time good faith ceases? A: 1. to pay the possessor in good faith indemnity for his cultivation expenses and charges and his share in the net harvest; OR 2. to allow him to finish the cultivation and gathering of the growing fruits. Q: What if the possessor refuses, for any reason, to finish the cultivation and gathering?

A: He forfeits the right to be indemnified in any other manner. (Article 545, par. 3) Q: What are necessary expenses? A: Those made for the preservation of the property or those without which, the thing would deteriorate or be lost. Ex. Those incurred for ordinary repairs required by the wear and tear due to the natural use of the thing. Q: What are the rights of a possessor w/ regard to necessary expenses? A: Good Faith 1. Right to refund 2. Right of retention - during its existence, not obliged to pay rent nor damages for refusing to vacate the premises.

Bad Faith Right to refund

Q: Why is there no right of retention in case of bad faith? A: As punishment for his bad faith. Q: Is there right of removal? A: None, whether in good faith or bad faith. Q: Why is there no right of removal? A: Because necessary expenses affect existence or substance of the property itself.

the

Q: What are useful expenses? A: Those which add value to a thing or augment its income to increase its usefulness or better serve the purpose for which it is intended. Ex. In leveling the ground, cutting down the trees and removing the shrubbery. Q: What are the rights of a possessor w/ regard to useful expenses? A: Good Faith 1. Right to refund 2. Right of retention 3. Right of removal, provided: • w/o damage to the principal thing • subject to the superior right of the prevailing party to keep the improvements by paying the expenses or the increase in value of the thing

Bad Faith No right

Q: What are expenses for pure luxury or mere pleasure? A: Those which are not necessary for the preservation of a thing nor do they increase its productivity, but merely to embellish the thing and for its enjoyment and convenience. Ex. Water fountains in gardens. Q: Must the objects be incorporated to the principal thing that their separation must necessarily reduce the value of the thing not curable by ordinary repairs?

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13 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

A: Yes.

b. Acquired at public sale in good faith – w/ reimbursement c. Law enabling the apparent owner to dispose as if he is owner d. Sale under Order of the court e. Purchases made at merchant stores, fairs or markets f. Negotiable document of title

Q: What are the rights of a possessor w/ regard to expenses for pure luxury? A: Good Faith Right of removal, proided: • w/o injury to principal thing • successor in possession does not prefer to refund amount expended

Bad Faith same rights, but liable only for the value of the ornaments at the time he enters into possession, in case he prefers to retain

Acquisitive Prescription Q: What are the prescriptive periods? A: 1. Movable • 4 years- good faith • 8 years- bad faith 2. Immovables • 10 years- good faith • 30 years- bad faith Q: Does acquisitive prescription apply to registered lands? A: No. Q: How is possession lost? A: (PRADA) 1. Possession of another subject to the provisions of Art. 537, if the new possession lasted longer than 1 year (real right to possess is not lost until after the lapse of 10 years) 2. Abandonment • Voluntary renunciation of all rights over a thing • There must be an intention to abandon • Effect: the thing is converted into res nullius • Not applicable to registered lands 3. Recovery of the thing by the legitimate owner 4. Destruction or total loss of the thing Assignment - complete transmission of the thing/right to another by any lawful manner. Q: When is a thing considered lost? A: A thing is lost when: • it perishes • goes out of commerce • disappears in such a way that its existence is unknown or if known, cannot be recovered. Q: What is the difference of assignment from abandonment? A: The former may either be gratuitous or onerous while abandonment is always gratuitous. Q: When is possession not considered lost? A: (WER) 1. When for the time being he may not know its whereabouts (movable) 2. When agent encumbered property without express authority – except when ratified 3. When possession may still be recovered: (PULMON) a. Unlawfully deprived or lost

Q: What is the right of a possessor who acquires movable claimed by another? A: (Article 559) 1. bad faith - no right 2. good faith- presumed ownership. It is equivalent to title. Q: What is the doctrine of irrevindicability? A: The possession of movable property acquired in good faith is equivalent to title. This is merely presumptive as it can be defeated by the true owner. (Art. 559) Q: What are the exceptions to the Doctrine of Irrevindicability? A: 1. When the owner has lost; or 2. Has been unlawfully deprived of a movable -the possessor cannot retain the thing as against the owner, who may recover it without paying any indemnity, Q: What is the exception to the exceptions? A: Where movable is acquired in good faith at a public sale, the owner must reimburse to recover. (Article 559 par. 2) Q: What is a public sale? A: One where there has been a public notice of the sale where anyone is allowed to bid. USUFRUCT Q: What is usufruct? A: It is the right to enjoy the property of another temporarily, including both the jus utendi (right to use) and the jus fruendi (right to the fruits) w/ the obligation of preserving its form and substance, unless otherwise provided. Q: What are the characteristics of usufruct? A: (PORTT) 1. constituted on Property- real/ personal, consumable/ non-consumable, tangible/ intangible 2. Ownership of which is vested in another 3. Real right 4. Temporary duration 5. Transmissible Q: Is the usufructuary bound to preserve the form and substance of the thing in usufruct? A: GR: Yes. XPN: In abnormal usufruct, whereby the law or the will of the parties may allow the modification of the substance of the thing. Q: Differentiate usufruct from lease. A: (CRONEC) Usufruct Nature

of

Real

Lease Personal

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

14 2007 Team Bar-Ops Civil Law Committee

right Creator right

of

Origin Extent of enjoyment Cause

Repairs and taxes

Owner or his agent

By law,contract,will of testator or by prescription All fruits, uses and benefits A passive owner who allows the usufructuary to enjoy the object of usufruct Usufructuary pays for ordinary repairs and taxes on the fruits

May not be the owner, as in the case of a sub-lessor or a usufructuary By contract Only those uses stipulated An active owner who makes the lessee enjoy Lessee is not obliged to pay for repairs/taxes

Q: What are the kinds of usufruct? A: (Article 564) (ENES) 1. As to extent of object: a. total – constituted on the whole thing b. partial – constituted only on a part 2. As to number of beneficiaries: a. simple – 1 usufructuary b. multiple – several usufructuaries w/c may be: 1. simultaneous – at the same time 2. successive – one after another 3. As to effectivity or extinguishment: a. Pure – no term/condition b. W/ a term – there is a period w/c may be either suspensive or resolutory c. Conditional – subject to a condition w/c may be either suspensive or resolutory 4. .As to subject matter: a. over things – involves tangible property b. over rights – involves intangible property Q: Can the right to receive support be the subject matter of usufruct? A: No, because the rights must not be strictly personal or intransmissible to be subject of usufruct. Q: What are the rights of the usufructuary as to the thing and its fruits? A: (RISERI) a. To receive the fruits of the property in usufruct and half of the hidden treasure he accidentally finds on the property (Arts 566, 438) b. To enjoy any increase which the thing in usufruct may acquire through accession (Art 571) c. To personally enjoy the thing or lease it to another (Arts 572-577) d. To make on the property such improvements or expenses he may deem proper and to remove the improvements provided no damage is caused to the property (Art 579) e. To set-off the improvements he may have made on the property against any damage to the same (Art 580) f. To retain the thing until he is reimbursed for advances for extraordinary expenses and taxes on the capital (Art 612) Q: What are the rights of the usufructuary as to the usufruct itself? A: (ARC)

a. To alienate (or mortgage) the right of usufruct (Art 572) xpt parental usufruct (Arts 225, 226 FC) b. In a usufruct to recover property/real right, to bring the action and to oblige the owner thereof to give him the proper authority and the necessary proof (Article 578) c. In a usufruct of part of a common property, to exercise all the rights pertaining to the co-owner with respect to the administration and collection of fruits or interests. Q: What are the rights of the usufructuary as to advances and damages? A: (ITD) a. To be reimbursed for indispensable extraordinary repairs made by him in an amount equal to the increase in value (Art 594) b. To be reimbursed for taxes on the capital advanced by him (Art 597, par. 2) c. To be indemnified for damages caused by him by the naked owner (Art 581) Q: What are the rights of a usufructuary to pending natural and industrial fruits? A: 1. Fruits growing at beginning of usufruct belong to the usufructuary who is not bound to refund to the owner the expenses of cultivation and production 2. Fruits growing up to the termination of usufruct - belong to the owner but he is bound to reimburse the usufructuary of the ordinary cultivation expenses (Article 545) out of the fruits received (Article 443) Q: What if the expenses exceed the proceeds of the growing fruits? A: The owner has no obligation to reimburse the difference. (Article 567) Q: May the usufructuary lease the thing in usufruct even w/o the owner’s consent A: Yes, but not being the owner, he cannot alienate, pledge or mortgage the thing itself. Q: May the usufructuary alienate, pledge, or mortgage the right of usufruct, even by gratuitous title? A: Yes, he, being the owner of the right itself. (Article 572) Q: What is the usufructuary liable for? A: For the damages suffered by reason of his fraud or negligence. Q: What is he not liable for? A: a. For deterioration due to wear and tear b. For deterioration due to a fortuitous event Q: What are the rights and obligations of the usufructuary with respect to consumable things? A: The usufructuary shall have the right to make use of the consumable thing. At the termination of the usufruct, he must: 1. pay its appraised value 2. if no appraisal: a. return the same quantity and quality;or

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15 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

b. pay its current price at such termination Q: What if the damages exceed the value of the improvements? A: The usufructuary is liable for the difference as indemnity. Q: What if the improvements exceed the amount of damages? A: He may remove the portion of the improvements representing the excess in value if it can be done without injury; otherwise, the excess in value accrues to the owner. Q: Why do improvements accrue to the owner? A: Because there is no indemnity for improvements. Q: What are the obligations of the usufructuary? A: Before usufruct Make an inventory

Give security

During Take care property

At termination of

Replace the young of animals that die or are lost when the usufruct is constituted on flock or herd of livestock Make ordinary repairs

Notify the owner of urgent extraordinary repairs Permit works & improvements by the naked owner not prejudicial to the usufruct Pay annual taxes and charges on the fruits Pay interest on taxes on capital paid by the naked owner Pay debts when usufruct is constituted on the whole patrimony Secure the naked owner’s/court's approval to collect credits in certain cases Notify the owner of any prejudicial act committed by 3rd persons Pay for court expenses and costs

Return the thing in usufruct to the naked owner unless there is a right of retention Pay legal interest for the time that the usufruct lasts

Indemnify the naked owner for any losses due to his negligence or of his transferees

Q: What are the exemptions to the obligation to give security? A: (SND) 1. No one will be injured by the lack of the bond 2. Donor reserved the usufruct of the property donated 3. Usufruct is subject to caucion juratoria Q: When does the usufructuary start to have a right to the proceeds and benefits after the security has been given? A: He shall have a right to all the proceeds and benefits from the day on which he should have commenced to receive them. (Retroactive effect of giving security) (Article 588) Q: What are ordinary repairs? A: Such as are required by the wear and tear due to the natural use of the thing and are indispensable for its preservation. (Article 592) Q: What are extraordinary repairs? A: 1) Those required by the wear and tear due to the natural use of the thing but not indispensable for its preservation. 2) Those required by the deterioration of or damage to the thing caused by exceptional circumstances and are indispensable for its preservation. Q: Who pays for extraordinary repairs? A: Depends on the kinds of extraordinary repairs: (Article 594) 1. If made by the owner- he can make them but to his expense and he shall have the right to demand of the usufructuary legal interest on the amount expended during the duration of the usufruct. 2. If made by the usufructuary- GR: the usufructuary may make them but he is not entitled to indemnity because they are not needed for the preservation of the thing. XPN: He shall have the right to demand the payment of the increase in value at the termination of the usufruct provided that: 1. He must notify the owner of the urgency of the repairs 2.The owner failed to make repairs notwithstanding such notification 3.The repair is necessary for the preservation of the property. Q: Does the usufructuary have the right of retention even after the termination of the usufruct? A: Yes, until he is reimbursed for the increase in value of the property caused by extraordinary repairs for preservation. Q: How is the increase in value determined? A: It is the difference between the value of the property before the repairs were made and the value after. Q: What is caucion juratoria? A: The usufructuary, being unable to file the required bond or security, files a verified petition in

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

16 2007 Team Bar-Ops Civil Law Committee

the proper court asking for the delivery of the house and furniture necessary for himself and his family without any bond or security. (Article 587) Q: How is usufruct extinguished? A: (PTTDERM) 1. Acquisitive prescription- use by a third person and not the non-use by the usufructuary 2. Termination of right of the person constituting the usufruct 3. Total loss of the thing- if the loss is only partial, the usufruct continues with the remaining part. 4. Death of the usufructuary- unless a contrary intention appears. Reason: Usufruct is constituted essentially as a lifetime benefit for the usufructuary or in consideration of his person. 5. Expiration of the period or fulfillment of the resolutory condition 6. Renunciation by the usufructuary- it partakes of a condonation or donation, it must comply with the forms of donation. 7. Merger of the usufruct and ownership in the same person who becomes the absolute owner thereof. (Article 1275) Q: What if the naked owner died? A: It does not terminate the usufruct. His rights are transmitted to the heirs. Q: Is renunciation an assignment of right? A: No, it is really an abandonment by the usufructuary of his right and does not require the consent of the naked owner but it is subject to the rights of creditors. EASEMENTS OR SERVITUDES Q: What is an easement or servitude? A: It is an encumbrance imposed upon an immovable for the benefit of another immovable belonging to a different owner or for the benefit of a community or one or more persons to whom the encumbered estate does not belong by virtue of which the owner is obliged to abstain from doing or to permit a certain thing to be done on his estate. (Articles 613, 614) Q: Differentiate easement from servitude. A: Easement An English law term Real The right enjoyed

Servitude Used in civil law countries Real or personal Burden imposed upon another

Q: What are characteristics of easement? A: (RAINCLEI) 1. A Real right but will affect third persons only when registered 2. Enjoyed over Another immovable never on one’s own property 3. Involves 2 neighboring Estates: the dominant estate to which the right belongs and the servient estate upon which an obligation rests. 4. Inseparable from the estate to which it is attached - cannot be alienated independently of the estate (Article 617)

5. Indivisible- not affected by the division of the estate between two or more persons (Article 618) 6. A right limited by the Needs of the dominant owner or estate, without possession. 7. It Cannot consist in the doing of an act unless the act is accessory in relation to a real easement. 8. A Limitation on the servient owner’s rights of ownership. Q: What do you mean by “easement established only on immovable?” A: The term “immovable” must be understood in its common and not in its legal sense. Q: Distinguish easement from usufruct. A: Easement On real property Limited to a particular or specific use of the servient estate Non-possessing right over an immovable Not extinguished by death of dominant owner Real right whether or not registered Transmissible

Usufruct Real or personal Includes all uses and fruits Involves a right of possession in an immovable or movable Extinguished by death of usufructuary Real right whether or not registered Transmissible

Q: Distinguish easement from lease. A: Easement Real right whether or not registered (whether real or personal) Only on real properties There is limited right to the use of real property of another but w/o right of possession

Lease Real right only when registered OR on real property, duration exceeds 1 yr Real or personal Limited right to both possession and use of another’s property

Q: What are the classifications of easements? A: 1. As to recipient of the benefit: a) Real – easement is in favor of another immovable. b) Personal – easement is in favor of a community, or of one or more persons to whom the encumbered estate does not belong. 2. As to source: a. Legal b. Voluntary c. Mixed a.

Legal – established by law for public use or for the interest of private persons. 1.Public Legal Easements – for public or communal use. 2.Private Legal Easements – for the interest of private persons or for private use.

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Waters (BWARDN) 1. natural drainage (Article 637) 2. drainage of buildings (Article 674) i.

17 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

3. easement on riparian banks for navigation, floatage, fishing, salvage, and towpath (Article 638) 4. easement of a dam (Article 639, 647) 5. easement for drawing water or for watering animals (Article 640-641) 6. easement of aqueduct (Articles 642636) - the right to make the water flow thru or under intervening or lower estates Q: What are the requisites? A: 1. owner of the dominant estate has the capacity to dispose of the water 2. water is sufficient for the use intended 3. proposed right of way is the most convenient and the least onerous to third persons 4. pay indemnity to the owner of the servient estate (Article 643) Q: How is the easement of aqueduct considered? A: For legal purpose, it is considered continuous and apparent even though the flow of water may not be continuous or its use depends upon the needs of the dominant estate or upon a schedule of alternate days or hours. (Article 646) ii.

Right of Way

- right to demand that the owner of an estate surrounded by other estates be allowed to pass thru the neighboring estates after payment of proper indemnity. Q: What are the requisites? A: 1. Claimant must be an owner of enclosed immovable or with real right 2. There must be no adequate outlet to a public highway 3. The right of way must be absolutely necessary not mere convenience 4. The isolation must not be due to the claimant’s own act 5. The easement must be established at the point least prejudicial to the servient estate 6. There must be payment of proper indemnity Q: What does “least prejudicial” mean? A: The shortest way and the one which will cause the least damage. Q: What if these 2 circumstances do not concur? A: The way which will cause the least damage should be used even if it will not be the shortest. Q: How much is the proper indemnity? A: If the passage is continuous and permanent – the indemnity consists of the value of the land occupied plus the amount of damages caused to the servient estate. If temporary – indemnity consists in the payment of the damage caused Q: How big should the easement be? A: The width of the easement shall be that which is sufficient for the needs of the dominant estate. (Article 651)

Q: Can a dominant owner demand a driveway for his automobile? A: Yes, due to necessity of motor vehicles in the present age. Q: Who is responsible for repairs and taxes? A: Dominant owner is liable for necessary repairs. A proportionate share of the taxes shall be reimbursed by said owner to the proprietor of the servient estate. This applies only to permanent easements. (Article 654) iii.

Party wall

- a common wall which separates two estates, built by common agreement at the dividing line such that it occupies a portion of both estates on equal parts; a kind of compulsory coownership Q: Distinguish party wall from co-ownership. A: Party Wall Shares of co-owners cannot be physically segregated but they can be physically identified No such limitation

Any owner may free himself from contributing to the cost of repairs and construction of a party wall by renouncing ALL his rights

Co-ownerhsip Can be divided physically; a co-owner cannot point to any definite portion of the property belonging to him None of the co-owners may use the community property for his exclusive benefit because he would be invading the rights of the others Partial renunciation is allowed

Q: Who spends for the cost of repairs and construction of party walls? A: Part-owners shall contribute in proportion to their respective interests. Q: May an owner refuse to contribute? A: GR: Yes, any owner may free himself by renouncing his rights in the party wall. XPN: When the party wall actually supports his building. (Article 662) Q: What if the owner of a building supported by a party wall desires to demolish the building? A: He may also renounce his part-ownership of the wall. He shall bear expenses of repairs and work necessary to prevent any damage which demolition may cause to the party wall. (Article 663) Q: May an owner increase the height of a party wall? A: Yes, provided: 1. He must do so at his own expense 2. He must pay for any damage caused even if it is temporary 3. He must bear the cost of maintaining the portion added 4. He must pay the increased cost of preservation of the wall (Article 664) 5. He shall be obliged to reconstruct the wall at his expense if necessary for the wall to

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

18 2007 Team Bar-Ops Civil Law Committee

bear the increased height and if additional thickness is required, he shall provide the space therefore from his own land.

2. Outlet must be at the point where egress is easiest and establishing a conduit for drainage 3. Proper indemnity

iv. Light & view •

•

Easement of light (jus luminum) -The right to admit light from neighboring estate by virtue of the opening of a window or the making of certain openings. Easement of View (jus prospectus) -The right to make openings or windows to enjoy the view thru the estate of another.

Q: What is the prescriptive period for acquisition of easement of light and view? A: 10 years. Q: From when does the prescriptive period start to run? A: Reckoning period depends on where the opening is made: • If made on one’s own wall and the wall does not extend over the property of another – easement is negative. Reason: the owner merely exercises his right of dominion and not of an easement. Negative easement is not automatically vested as formal prohibition is required. Period of prescription- starts from the time formal prohibition is made. •

If made thru a party wall or on one’s own wall which extends over the neighboring estate – easement is positive. Reason: owner of the latter estate who has a right to close it up allows an encumbrance on his property. Period of prescription – starts from the time the window is opened.

Q: How about with regard to openings at height of ceiling joists? A: The owner of a wall which is not a party wall may make an opening to admit light and air, but not view subject to the ff: 1.The size must not be >30 centimeters square 2.The opening must be at the height of the ceiling joists or immediately under the ceiling 3.There must be an iron grating imbedded in the wall 4.There must be wire screen Q: What if a wall becomes a party wall? A: A part-owner can order the closure of the opening. No part-owner may make an opening thru a party wall without the consent of the others. Q: Does non-observance of the distances provided in Article 670 give rise to prescription? A: No, this refers to a negative easement as the window is thru a wall of the dominant estate. Q: Define drainage of buildings A: It is the right to divert the rain waters from one’s own roof to the neighbor’s estate. Q: What are the conditions for drainage of buildings? A: 1. No adequate outlet

Q: Can there be a stipulation or testamentary provision allowing excavations that could cause danger to an adjacent land or building? A: No, the same shall be void. (Article 685) Q: What should be done first before making an excavation? A: Any proprietor who intends to make any excavation shall notify all owners of adjacent lands. b. Voluntary – established by the will of the owners. Voluntary easements are governed by: 1. Title (in its existence) 2. Prescription 3. Civil Code (in default of the above) 3. As to its exercise: a) Continuous Easements – the use of which are, or may be, incessant without the intervention of any act of man. Ex. right of aqueduct b) Discontinuous Easements – used at intervals and depend upon the acts of man. Ex. right of way when it is physically impossible that man shall continually pass over the way. 4. As to whether or nor its existence is indicated: a) Apparent Easements – made known and are continually kept in view by external signs that reveal the use and enjoyment of the same.It is not necessary that its sign be seen; as long as it may be seen or known on inspection. b) Non-apparent Easements – show no external indication of their existence 5. As to the duty of the servient owner: a) Positive – imposes upon the owner of the servient estate the obligation of allowing something to be done or doing it himself. Ex. right of way-imposes the duty to allow the use of said way. b) Negative – prohibits the owner of the servient estate from doing something which he could lawfully do if the easement did not exist. Ex. Easement of light and view where the owner is prohibited from obstructing the passage of light. Q: What are the rights of the dominant owner? A: (ARME) 1. Exercise all the rights necessary for the use of the easement (Article 625) 2. Make on the servient estate all works necessary for the use and preservation of the servitude (Article 627 par. 1) 3. Renounce the easement if he desires to exempt from contributing necessary expenses (Article 628) 4. Ask for mandatory injunction to prevent impairment of his right. (Resolme v. Lazo, 27 Phil 416) Q: What are the obligations of the dominant owner?

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19 CIVIL LAW NOTES

A: 1. 2.

3.

4.

He cannot alter the easement or render it more burdensome. (Article 627 par. 1) He shall notify the servient owner of works necessary for the use and preservation of the servitude. (Article 627 par. 2) He must choose the most convenient time and manner in making the necessary works as to cause the least inconvenience to the servient owner. He must contribute to the necessary expenses if there are several dominant estates in proportion to the benefits derived from the works (Article 628 par. 1)

Q: What are the rights of the servient owner? A: (RMC) 1. Retain the ownership of the portion of the estate on which easement is imposed 2. Make use of the easement (Article 628 par. 2), unless there is an agreement to the contrary. 3. Change the place or manner of the use of the easement, provided it be equally convenient (Article 629, par. 2) Q: What are the obligations of the servient owner? A: (IC) 1. He cannot impair the use of the easement. 2. Contribute to the necessary expenses in case he uses the easement, unless otherwise agreed upon (Article 628 par. 2) Q: How are easements acquired? A: (PARFT) 1. By title – All easements: a. Continuous and apparent easements b. Continuous non-apparent easements and discontinuous easements, whether apparent or non-apparent 2. By prescription of ten years – continuous and apparent easements. 3. By deed of recognition 4. By final judgment 5. By apparent sign established by the owner of the two adjoining estates Q: How is the prescriptive period computed? A: positive easement- the period is counted from the day when the owner of the dominant estate begins to exercise it Negative- from the day a notarial prohibition is made on the servient estate Q: How are easements extinguished? A: (REMAINCREW) Redemption agreed upon 2. Expiration of the term or fulfillment of the resolutory condition 3. Merger of ownership of the dominant and servient owner Annulment of the title to the servitude Impossibility to use the easement Non-user : 10 years

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

7. Condition that the easement cannot be used 8. Resolution of the right of grantor to create the easement (as when the vendor a retro redeems the land) Expropriation of the servient estate 10. Waiver by the dominant owner gathered from positive acts NUISANCE Q: What is a nuisance? A: Any act, omission, establishment, business or condition of property or anything else which (ISAHO): 1. Injures/dangers the health or safety of others 2. Shocks, defies or disregards decency or morality 3. Annoys or offends the senses 4. Hinders or impairs the use of property or 5. Obstructs or interferes with the free passage to any public highway or street or body of water Q: What are the classes of nuisance? A: (SAPuPri) 1. Nuisance Per Se- nisance at all times and under all circumstances regardless of location and surrounding. Ex. house of prostituion 2. Nuisance Per Accidens – nuisance by reason of circumstances, location or surroundings. Any nuisance other than nuisance per se. Ex. Raising and breeding pigs in a house within city limits 3. Public Nuisance – affects the community or a considerable number of persons. 4. Private Nuisance – affects only a person or a small number of persons. Q: May a nuisance be both public and private? A: Yes, it is called mixed nuisance. Ex. A house washed on to a street railway track: private nuisance to the railway company and a public nuisance because it obstructs the street. Q: Distinguish nuisance from trespass. A: Nuisance Use of one’s own property w/c causes injury to another Injury is consequential

Trespass Direct infringement of another’s right or property Injury is direct and immediate

Q: What is an attractive nuisance? A: It is a dangerous instrumentality or appliance which is likely to attract children at play. Q: What is the doctrine of attractive nuisance? A: One who maintains on his estate or premises an attractive nuisance without exercising due case to prevent children from playing therewith or resorting thereto, is liable to a child of tender years who is injured thereby, even if the child is technically a trespasser in the premises. Q: What is the basis for liability?

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

20 2007 Team Bar-Ops Civil Law Committee

A: The attractiveness is an invitation to children. Safeguards to prevent danger must therefore be set up. Q: Is a swimming pool an attractive nuisance? A: GR: A swimming pool or water tank is not an attractive nuisance, for while it is attractive, it is merely an imitation of the work of nature. Hence, if small children are drowned in an attractive water tank of another, the owner is not liable even if there be no guards in the premises (Hidalgo v. Balandan). XPN: Swimming pool with dangerous slides Q: Is a gift-wrapping counter an attractive nuisance? A: Yes, full of ribbons and colors. (Jarco Marketing v. CA) Q: What are the elements of attractive nuisance? A: 1. It must be attractive 2. Dangerous to children of tender years. Q: What are the remedies against nuisance? A: Public Civil action Abatement w/o judicial proceedings Prosecution under RPC/local ordinance

Private Civil Action Abatement w/o judicial proceedings

Q: What is abatement? A: It is the removal or destruction of a nuisance. Q: What are the requisites of extra-judicial abatement? A: 1. The nuisance must be specially Injurious to the person affected. 2. No breach of peace or unnecessary injury must be committed 3. Demand must first be made upon the owner or possessor of the property to abate the nuisance. 4. Demand is rejected 5. Abatement is approved by the district health officer and executed with the assistance of the local police, and 6. Value of destruction does not exceed P3,000 Q: Distinguish nuisance per se from nuisance per accidens. A: Nuisance Per Se As a matter of law Need only be proved in any locality May be summarily abated under the law of necessity

Nuisance Per Accidens As a matter of fact Depends upon its location and surroundings, the manner of its conduct or other circumstances May be abated only with reasonable notice to the person alleged to be maintaining or doing such nuisance

Q: Can the owner of the thing abated recover damages? A: Yes, if the thing is found by the court not to be a nuisance.

Q: Does the right to question the existence of a nuisance prescribe? A: No. It is imprescriptible. BOOK THREE DIFFERENT MODES OF ACQUIRING OWNERSHIP Q: Differentiate mode from title. A: Mode Directly and immediately produces a real right cause Proximate cause Essence of the right which is to be created or transmitted

Title Serves merely to give the occasion for its acquisition or existence means Remote cause Means whereby that essence is transmitted

Q: Differentiate real from personal right. A: Real right (jus in re) is the power of a person to obtain certain financial or economic advantages over a specific thing; a power enforceable against the whole world whether or not he possesses the thing. While personal right (jus in personam) is the power of a person to demand from another the fulfillment of a prestation to give, to do, or not to do. Q: Whate are the modes of acquiring ownership? A: (OLD TIPS) 1. Occupation 2. Law 3. Donation 4. Tradition 5. Intellectual creation 6. Prescription 7. Succession Q: What are the requisites of occupation? A: (SCSWI) 1. There must be seizure of a thing, 2. which must be a corporeal personal property, 3. which must be susceptible of appropriation by nature 4. The thing must be without an owner 5. There must be an intention to appropriate Q: Distinguish occupation from possession. A: Occupation Mode of acquiring ownership Involves only corporeal personal property Requires that the object be without an owner There must be an intent to acquire ownership May not take place w/o some form of possession Short duration Cannot lead to another mode of acquisition

Possession Merely raises the presumption of ownership when exercised in the concept of owner Any kind of property The property may be owned by somebody May be had in the concept of a mere holder May exist w/o occupation Generally longer May lead to another modeprescription

Q: What are the requisites of tradition? A: (PJICM)

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21 CIVIL LAW NOTES

1. 2. 3. 4.

Right transmitted should have previously existed in the patrimony of the grantor Transmission should be by just title Grantor and grantee should have intention and capacity to transmit and acquire Transmission should be manifested by some act which should be physical, symbolical or legal

Q: What are the kinds of tradition? A: 1. Real Tradition 2. Constructive Tradition (S LBC QPI) a. Traditio symbolica – parties make use of a token or symbol to represent the thing delivered b. Traditio longa manu – by mere consent of the parties if the thing sold cannot be transferred to the possession of the vendee at the time of the sale c. Traditio brevi manu – when the vendee already has possession of the thing sold by virtue of another title d. Traditio constitutum possessorium – when the vendor continues in possession of the thing sold not as owner but in some other capacity e. Quasi-tradition – exercise of the right of the grantee with the consent of the grantor f. Tradicion por ministerio de la ley – delivery by operation of law g. Tradition by public instrument

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

A: Because the donee may not want to accept the donor’s liberality or if donation is onerous, he may not agree with the burden imposed. Q: Who may accept donations made to conceived and unborn children? A: These may be accepted by persons who legally represent them if they were already born (Article 742). Q: What is the status of donations made to incapacitated persons? A: These donations made to incapacitated persons shall be void though simulated under the guise of another contract or thru a person who is interposed (Article 743). Q: Who are incapacitated persons? A: Persons specially disqualified by law to become donees and not persons without capacity to act. Q: What rules govern donations of the same thing to different donees? A: These are governed by provisions on double sale as set forth in Article 1544 (Article 744). Q: Who qualifies as a donor? A: He must have capacity to contract and capacity to dispose of his property (Article 735). Q: Why is there a need for capacity to contract? A: Because donation inter vivos are contractual in nature and are mode of alienation of property.

Q: What is donation? A: Donation is an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another who accepts it. (Article 725)

Q: When should the donor have this capacity? A: His capacity shall be determined as of the tine of the making of donation. (Article 737) Making of donation shall be construed to mean perfection.

Q: When is donation perfected? A: Donation is perfected from the moment the donor knows of the acceptance by the donee (Article 734). Once a donation is perfected, it cannot be revoked without the consent of the donee except on grounds provided by law (Articles 760, 764, 765)

Q: Who may qualify as donees? A: All those who are not specially disqualified by law.

Q: What are the requisites of donation? A: (CIDA) 1. Donor must have capacity to make the donation 2. He must have donative intent (animus donandi) 3. There must be delivery 4. Donee must accept or consent to the donation during the lifetime of the donor and of the donee in case of donation inter vivos (Article 746); whereas in case of donation mortis causa, acceptance is made after donor’s death because they partake of a will (Article 728) Q: Who must make the acceptance? A: Acceptance may be made by the donee himself or thru an agent with special power of attorney otherwise, donation shall be void. (Article 745) Q: Why is there a need for an acceptance?

Q: What are the kinds of donation? A: A. According to motive or cause: (SRMO) 1. Simple • Cause: pure liberality • Form: that of donations 2. Remuneratory (1st kind) • Purpose: to reward past services • The services do not constitute a demandable debt • Form: that of donations 3. Remuneratory (2nd kind) or Conditional/Modal donation • Purpose: a) Reward future services; or b) Because of future charges or burdens to be imposed on the donee • The value of the future services, charges or burdens is LESS than the value of the donation. • Form: onerous- that of contracts Simple- that of donations • Illegal or impossible conditions in simple and remuneratory donations shall be considered as not imposed (Article 727)

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

22 2007 Team Bar-Ops Civil Law Committee

4.

Onerous donation • Burdens, charges or services are equal in value to that of the donation. • This is not really a donation. • Form: that of contracts.

B. According to the time of taking effect: 1. Inter vivos (Article 729) 2. Mortis causa (Article 728) Q: Distingusih donation inter vivos from mortis causa. A: Donation Mortis Donation Inter Vivos Causa 1. Takes effect during the lifetime of the donor, independently of the his death 2. Cause is donor’s pure generosity 3. Valid if donor survives the donee 4. Generally irrevocable except for grounds provided for by law 5. Must comply with the formalities of donations 6. Acceptance during donor’s lifetime 7. Property completely conveyed to the donee 8. Donor’s tax

Takes effect upon donor’s death In contemplation of donor’s death w/o intention to dispose of the thing in case of survival Void if donor survives Always revocable at any time and for any reason before the donor’s death Must comply with the formalities of a will After donor’s death Property retained by the donor while he is still alive Estate tax

Q: What are the limitations upon property which may be donated inter vivos? A: (RFM) 1. Donor must reserve sufficient means for his support and for his relatives who are entitled to be supported by him (Article 750) 2. Donation cannot comprehend future property except future husband and wife (See Article 84 FC) 3. No person may give by way of donation more than he may give by will Q: What are the donations prohibited by law? A: (CP WARP PANS) 1. By persons guilty of adultery or concubinage at the time of donation; (Article 739) 2. Between persons found guilty of the same criminal offense in consideration thereof; 3. To a public officer or his/her spouse, descendants or ascendants in consideration of his/her office; 4. To the priest who heard the confession of the donor during the latter’s last illness, or the minister of the gospel who extended spiritual aid to him during the same period; 5. To relatives of such priest, etc. within the 4th degree, or to the church to which such priest belongs; 6. By a ward to the guardian before the approval of accounts; 7. To an attesting witness to the execution of donation, if there is any, or to the spouse, parents or children or anyone claiming under them;

8. To a physician, surgeon, nurse, health officer or druggist who took care of the donor during his/her last illness; 9. By individuals, associations or corporations not permitted by law to make donations; and 10. By spouses to each other during the marriage or to persons of whom the other spouse is a presumptive heir. (Articles 745, 752, 753, 754a) Q: What are the forms of donation? A: 1. Of movable property: a. With simultaneous delivery of property donated: - P 5,000 or < - may be oral/written - > P 5,000 – written in public or private document b. Without simultaneous delivery - The donation and acceptance must be written in a public or private instrument (Statute of Frauds), regardless of value. Otherwise, donation is UNENFORCEABLE 2. Of immovable property: a. Must be in a public instrument specifying the property donated and the burdens assumed by the donee b. Acceptance may be made: - In same instrument or - In another public instrument, notified to the donor in authentic form, and noted in both deeds. Otherwise, donation is VOID. Q: What may donation cover? A: Donation may cover all present property. Donation cannot comprehend future property. (Article 751) Q: Can future inheritance or the inchoate right to inherit be donated? A: No, because it is future property. Q: May property, the acquisition of which is subject to suspensive condition be donated? A: Yes, because once the condition is fulfilled, it retroacts to the day the contract is constituted. (Article 1187 par 1) Q: May ownership of property may be donated to a person and usufruct to another? A: Yes, provided all the donees are living at the time of donation. (Article 756) Q: What are the rights and actions of the donor and donee? (Article 754) A: The donee is subrogated to the rights and actions which in case of eviction would pertain to the donor. If the donation is simple or remunerative, donor is not liable for eviction or hidden defects because the donation is gratuitous, unless the donor acted in bad faith. If the donation is onerous, the donor is liable on his warranty but only to the extent of the burden. Q: What are the rules regarding the liability of the donee to pay the debts of donor? A: 1) where donor imposes obligation upon the donee: (Article 758)

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23 CIVIL LAW NOTES

2)

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

a. Donee is liable to pay only debts previously contracted b. Liable for debts subsequently contracted only when there is an agreement c. Not liable for debts in excess of the value of donation received, unless the contrary is intended. where there is no stipulation regarding the payment of debts: (Article 759) a. Donee is generally not liable to pay donor’s debts b. Donee is responsible only if donation has been made in fraud of creditors which is always presumed when the donor has not left sufficient assets to pay his debts, at the time of donation c. Not liable beyond the value of donation received. RULES ON DONATION Rules on Revocation

Grounds

Prescription of Action 1. Birth, W/in 4 appearance years from or adoption birth of 1st of a child child, (Art. 760) legitimation (recognitio n),adoption , judicial declaration of filiation or receipt of info of existence of the child believed to be dead (Art. 763, 1) 2. NonW/in 4years compliance from with nonconditions compliance (Art. 764) (Art. 764, - can be last par) renounced; contractual in nature

3. Act of ingratitude (Art. 765)

W/in 1 year from donor’s knowledge of the act of ingratitude (Art. 769)

Transmissibility of Action To children & descendants of donor upon his death (Art. 763, 2)

To donor’s heirs and may be against the donee’s heirs (Art. 764, last par)

Genereally not transmitted to heirs of the donor nor filed against the doneee’s heirs (Art. 770)

Effect of Revocat ion Property must be returned or its value if sold, or redeem the mortgag e with a right to recover the property (Art. 762, 1-2)

Liabili ty for fruits Donee must return those accruin g from the filing of the complai nt (Art. 768,1)

Property shall be returned, alienatio ns and mortgag es are void subject to the rights of innocent 3rd persons (Art. 764, 2) Property to be returned; but alienatio ns & mortgag es before notation of complain t in the Registry of

Donee must return those receiv ed after noncompli ance (Art. 768, 2)

Same as in #1

Property subsist (Art. 766)

Rules on Reduction Grounds 1. Failure of the donor to reserve sufficient means for support (Art. 750) 2. Inofficiousness for being in x’ss of what the donor can give by will (Art. 750, 771)

Prescription of action Any time by the donor or by relatives entitled to support during the donor’s lifetime (Art. 750) Within 5 years after the donor’s death (Art. 771, 1149)

3. Birth, appearance or adoption of a child (Art. 760)

Same as in #1 Revocation

4. Fraud against creditors (Art. 759)

Within 4 years from perfection of donation or from knowledge by the creditor of the donation (Art. 1389)

Transmiss ibility of action Not transmissible (duty to give and right to receive support are personal (Art. 195, FC) Transmissi ble to donor’s heirs as donation shall be reduced as regards the x’ss at donor’s death (Art. 771) Same as in #1 Revocation

Effect of reduction

Rights to fruits

Donation reduced to extent necessary to provide support (Art. 750)

Donee is entitled to the fruits as owner of the property donated (Art. 441)

Donation effective during the donor’s lifetime subject to reduction only upon his death with regard to the x’ss (Art. 771) Same as in #1 Reduction

Donee appropriate s fruits (Art. 441)

To creditor’s heirs or successors -in-interest (Art. 1178)

Property returned for the benefit of creditors subject to the rights of innocent 3rd persons (Art. 1387)

-retum those from filing of complaint

Donee appropriate s fruits not affected by reduction (Art. 441), but with regard to the x’ss, liable only for fruits accruing from the filing of the complaint (Art 768, 1) Fruits shall be returned (Art. 1387) in case donee acted in bad faith; if impossible to return, indemnify the donor’s creditor for damages (Art. 1388, 1)

PRESCRIPTION Q: What are the kinds of prescription? A: 1. Acquisitive prescription - one acquires ownership and other real rights through the lapse of

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

24 2007 Team Bar-Ops Civil Law Committee

time in the manner and under the conditions laid down by law. a. Ordinary – requires the possession of things in good faith and with a just title for the time fixed by law b. Extraordinary – does not require good faith or just title but possession for a period longer than ordinary acquisitive prescription 2. Extinctive prescription – loss of property rights or actions through the possession by another of a thing for the period provided by law or failure to bring the necessary action to enforce one’s right with in the period fixed by law.

b. d.

Q: What are the requisites of extraordinary prescription? A: (GLASC) a. capacity of the possessor to acquire by prescription susceptibility of object to prescription c. adverse possession of the character prescribed by law lapse of time required by law e. good faith of the possessor or proof of just title Q: Differentiate acquisitive from extinctive prescription. A: Acquisitive Prescription 1. requires possession by a claimant who is not the owner 2. applicable to ownership and other real rights 3. vests ownership and other real rights in the occupant 4. results in the acquisition of ownership or other real rights in a person as well as the loss of said ownership or real rights in another 5. can be proven under the general issue without its being affirmatively pleaded 6. the possessor is the actor

Extinctive Prescription 1. inaction of the owner of possession or neglect of his right to bring an action 2. applicable to all kinds of rights whether real or personal 3. produces the extinction of rights or bars a right of action 4. results in the loss of a real or personal right or bars the cause of action to enforce the right 5. should be affirmatively pleaded AND proved to bar the action or claim of the adverse party 6. neglect of the owner is considered

Q: Distinguish prescription from laches. A: Prescription Laches 1. fact of delay 2. question of time 3. statutory 4. applies at law 5. cannot be availed unless it is especially pleaded as an affirmative allegation 6. based on a fixed time

1. effect of delay 2. question of inequity 3. not statutory 4. applies in equity 5. need not be specifically pleaded; the court mat consider it on its own initiative 6. not based on a fixed time

8 years

Q: What are the rules for the computation of time necessary for prescription? A: (Article 1138) 1. The present possessor may complete the period necessary for prescription by tacking his possession to that of his grantor or predecessor in interest. 2. It is presumed that the present possessor who was also the possessor at a previous time, has continued to be in possession during the intervening time, unless there is proof to the contrary. 3. The first day shall be excluded and the last day included. Q: Who are the persons against whom prescription runs? A: (MAPJ) 1. Minors and other incapacitated persons who have parents, guardians or other legal representatives. 2. Absentees who have administrators. 3. Persons living abroad who have managers or administrators 4. Juridical persons, except the state and its subdivision Q: Who are the persons against whom prescription does not run? A: (B- SPG) 1. Between spouses, even though there be a separation of property agreed upon in the marriage settlements or by judicial decree. 2. Between parents and children, during the minority or insanity of the latter. 3. Between guardian and ward during the continuance of the guardianship Q: What are the prescriptive periods provided under the law? A: Prescriptive Period a.) Imprescriptible 2.

3. 4. 5.

Q: What are the periods of prescription with regard to movables and immovables? A: Movables Immovables

6. 7. 8.

Good Faith 4 years

10 years Bad Faith

30 years

b.) 30 years

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Actions 1. to declare an inexistent or void contract to quiet title to demand right of way (Article 1143) to bring an action for abatement of public nuisance (Article 1143) to demand partition in coownership to enforce a trust probate of a will to recover possession of a registered land under the Land Registration Act by the registered owner

real actions over immovables

25 CIVIL LAW NOTES

c.) 10 years

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

without prejudice to the acquisition of ownership or real rights by acquisitive prescription (Article 1141)

i.) 2 years

action to impugn legitimacy of a child if the husband or his heirs are not residing in the city or municipality of birth

1.

j.) 1 year

1. action to impugn legitimacy of a child if the husband or his heirs are residing in the city or municipality of birth 2. forcible entry and unlawful detainer 3. Defamation 4. Revocation of donation on the ground of ingratitude 5. Rescission or for damages if immovable is sold with an apparent burdens or servitude 6. action for warranty of solvency in assignment of credits 7. actions for loss or damage to goods under the COGSA actions for warranty against hidden defects or encumbrances over the thing sold redhibitory action based on faults or defects of animals

2. 3. 4.

5. d.) 8 years

e.) 6 years

action to recover movables without prejudice to acquisition of title for a shorter period or to possess title under Arts. 559, 1505, 1133 (Art. 1140)

1. 2.

f.) 5 years

g.) 4 years

h.) 3 years

actions upon a written contract (Article 1144) actions upon an obligation created by law (Article 1144) upon a judgment from the time it becomes final (Article 1144) actions among co-heirs to enforce warranty against eviction in partition action in mortgages (Article 1142)

actions upon oral contracts (Article 1145) actions upon quasi-contracts (Article 1145)

1. action for annulment of marriages (except if the ground is insanity) and for legal separation reckoned from occurrence of cause 2. actions against the co-heirs for warranty of solvency the debtor in credits assigned in partition 3. action for the declaration of the incapacity of an heir 4. all other actions whose periods are not fixed by law counted from the time the right of action accrues 1. action to revoke donations due to non-compliance of conditions (Art. 764) 2. action to rescind partition of deceased’s estate on account of lesion 3. action to claim rescission of contracts (Art. 1389) 4. annulment of contracts for vice of consent (Art. 1391) 5. actions upon a quasi-delict (Art. 1146) 6. actions to revoke or reduce donations based on birth, appearance or adoption of a child (Art. 763) 7. actions upon an injury to the rights of the plaintiff not arising from contracts (Art. 1146) 1. actions under the eight hour labor law 2. actions to recover losses in gambling 3. money claims as a consequence of employeremployee relationship 4. action to impugn legitimacy of a child if the husband or his heirs reside abroad

k.) 6 months l.) 40 days

SUCCESSION Art. 774. Succession is a mode of acquisition by virtue of which the property, rights and obligations to the extent of the value of the inheritance of a person are transmitted through his death to another or others either by his will or by operation of law. Q: What is succession? A: Succession is a mode of acquisition where property, rights, and obligations of a person (to the extent of value of the inheritance) are transmitted through his death to another/others either by will or operation of law (Article 774, NCC). Q: What are the requisites of succession? A: 1. Death of decedent 2. Transmissible estate 3. Existence and capacity of successor, designated by decedent or law 4. Acceptance of successor Q: What are the characteristics of succession? A: 1 It is a mode of acquisition 2 The property, rights and obligations to the extent of the value of the inheritance transmitted 3 The transmission takes place only at the time of death. 4 The transmission takes place either by will or by operation of law. Important Principles of Succession:

 1. Mortis Causa.--Succession can not take place while the owner is alive. The heir/successor has a mere expectancy right to the property of the decedent, during the lifetime of the latter.  2. The interest of the family may override the will of the decedent because of compulsory heirs. A will cannot impair the legitime.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

26 2007 Team Bar-Ops Civil Law Committee

 3. The estate passes or devolves to the family unless the decedent expressly orders otherwise in a will. Family covers spouse, ascendants, descendants, and collateral relatives.  4. The family cannot be entirely deprived of the estate because of the system of legitime.  5. Within the family, heirs of equal degree/ proximity inherit in equal shares. There is presumption of equality.  6. The State has a share in the inheritance through taxes.  7. The heirs are not liable for the debts of the estate beyond their share in the inheritance. Estate is liable for the debts left by the decedent. Art. 776. The inheritance includes all the property, rights and obligations of a person which are not extinguished by his death. Q: What is transferred by death in succession? A: The property, rights and obligations not extinguished by death are transmitted to the heirs. Q: Distinguish between succession and inheritance. A: Succession Inheritance The legal mode by which property, rights and obligations are transmitted.

The universality of all the property, rights and obligations constituting the patrimony of the decedent which are not extinguished by his death and are transmitted to the successor

Q: Distinguish between inheritance and patrimony. A: Inheritance Patrimony That portion of the patrimony of a person which is not extinguished by death.

The aggregate of all juridical relations of a person susceptible of economic valuation.

Q: What is the extent of inheritance? A: Inheritance includes the: 1. Property existing at the time of his death 2. Transmissible rights and obligations existing at the time of his death A. Property- includes real and personal properties owned by the decedent. B. Rights- Some rights are extinguished by death, some are not. Q: What rights are not transmissible upon the death of a person? A: 1. Purely personal rights2. Rights which are made intransmissible by stipulation of the parties. 3. Rights which are intransmissible by provision of law.  All other rights are transmissible to the heirs upon the death of a person Examples of Rights or Obligations Extinguished by Death by Operation of Law

1. 2. 3. 4. 5. 6.

Usufruct Legal Support Parental authority Personal Easements Partnership rights Agency

C. Obligations- A distinction must be made between monetary and non-monetary obligations. 1. 2.

Non-monetary obligations are transmitted to the heirs. Monetary obligations are not transmitted to the heirs.

 The heirs are not personally liable with their own individual properties for the monetary obligations/debts left by the decedent.  Estate pays for the debts left by the decedent.  However, if the debts are not paid in settlement proceedings, the heirs could be liable only to the extent of what they received. General rule: Contracts or obligations are binding upon the parties, their heirs or heirs. Exceptions: Those which are made intransmissible: 1. by their nature; 2. by stipulation; or 3. by provision of law (Art 1311, NCC) Q: Is a contract of guaranty extinguished by death? A: No, a contract of guaranty does not fall in any of the exceptions under Art. 1311. A guarantor’s obligation is basically to pay the creditor if the principal debtor cannot pay. Payment does not require any personal qualifications. The personal qualifications become relevant only at he time the obligation is incurred but not so at the time of discharge or fulfillment of the obligation. Q: Suppose an action for legal separation was filed in court by the wife. During the pendency of the action, the wife died. The children, however, would want to continue the action because their father is really guilty of concubinage. They petitioned the court to allow them to be substituted for their deceased mother. They argued that the action should be allowed to continue because it would determine whether or not their father would be inheriting or not. Decide. A: The children cannot be substituted in an action for legal separation upon the death of their mother who filed the case. An action for legal separation is purely personal on the part of the innocent spouse because such an action affects the marital status of the spouses. Q: Is an action to quiet title extinguished by death? A: No, an action to quiet title is not extinguished by the death of the decedent, it being a patrimonial right. Hence, the heirs have the right to be substituted to the action even before their having declared as heirs. Q: What is the status of the rights of the heirs to the inheritance prior to the decedent’s death or during his lifetime?

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27 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

A: The nature of the right of the heirs to the inheritance prior to the death of decedent is merely an expectancy or inchoate. Q: What is the status of the rights of the heirs to the inheritance at the moment of death of the decedent? A: Rights to succession vest at the moment of death, not upon the filing of petition for testate/ intestate proceedings, not upon the declaration of heirship or upon settlement of the estate. Q: Can the heir enter to a contract of sale, conveyance or any disposition pertaining to his interest in the inheritance even pending the settlement of the estate? A: Yes, because his hereditary share/interest in the decedent’s estate is transmitted or vested immediately from the moment of decedent’s death. This is, however, subject to the outcome of the settlement proceedings. Q: What is the nature of the transaction entered into by the heir pertaining to his hereditary share in the estate pending the settlement of the estate? A: The effect of such transaction is to be deemed limited to what is ultimately adjudicated to the heir. However, this aleatory character of the contract does not affect the validity of the transaction. Q: What are the kinds of succession? A: 1. Testate or voluntary- Succession by virtue of a will. 2. Intestate or legal- Succession by operation of law, in accordance with the presumed will of the decedent. 3. Compulsory- Succession by operation of law; succession to the legitime. 4. Mixed- Succession partly by will and partly by operation of law. Q: Who is an heir? A: An heir succeeds to the whole or to an aliquot portion of the inheritance either by will or by operation of the law. Kinds of Heirs: 1. Voluntary-by virtue of the will of the testator 2. Compulsory- called by law to succeed to a portion of the testator’s estate known as legitime. 3. Legal or Intestate-by operation of law through intestate succession. Q: Who is a devisee?legatee? A: A devisee succeeds to a specific real property. A legatee succeeds to specific personal property. Q: What are the distinctions between heirs and legatees/devisees? A: Heirs Devisees/Legatees Represent the juridical personality of the deceased and acquires his rights with certain exceptions to his obligations

Never represent the personality of the deceased no matter how big is the legacy or devise

Inherit an undetermined quantity whose exact amount cannot be known a priori and which cannot be fixed until the inheritance is liquidated Succeed to the remainder of the properties after all the debts and all the legacies and devisees have been paid Can exist whether the succession be testate or intestate

Are always given a determinate thing or a fixed amount

In case of preterition, the institution of an heir is entirely annulled.

The legacies and devises remain valid insofar as they are not inofficious. The legacies and devisees remain valid insofar as they are not inofficious.

In case of imperfect or defective disinheritance, the institution of an heir is annulled to the extent that the legitimes are impaired.

Only succeed to the determinate thing or quantity which is mentioned in the legacy or devise Only in testamentary succession

Q: Suppose a person is named to succeed to an entire estate. The estate, however, consists of only one parcel f land. Is he an heir or a devisee? A: It depends on the manner of his designation in the will. Here, because he is called to inherit the entire estate, he is therefore an heir. Q: Can the remains of the decedent be inherited? A: No. The remains of a person is beyond the commerce of men hence, may not be lawfully appropriated. Only properties which can be the object of appropriation may be inherited. TESTAMENTARY SUCCESSION Q: What is a will? A: A will is an act whereby a person is permitted, with the formalities prescribed by law, to control to a certain degree the disposition of his estate, to take effect after his death (Article 783, NCC). Q: What are the characteristics of a will? A: A will is: 1. Statutory act- The making of a will is only a statutory not a natural right. Hence, a will should be subordinated to both the law and public policy. 2. Unilateral act- No acceptance by the transferees is needed during the lifetime of the testator. 3. Strictly personal act- It is strictly personal in all matters that are essential. 4. Ambulatory- A will is essentially revocable during the lifetime of the testator. 5. Free from vices of consent- A will must have been executed freely, knowingly and voluntarily, otherwise, it is disallowed. 6. Individual act- A will must be executed only by one person. A joint will is not allowed in the Philippines.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

28 2007 Team Bar-Ops Civil Law Committee

7. Solemn or formal act- A will is executed in accordance with formalities prescribed by law.

2. A description of which no person or property exactly answers

Q: What is meant by “strictly personal act”? A: It means that in the making of a will preparation thereof cannot be wholly or partially entrusted to a third person or made through an agent or attorney. It refers to the disposition of property. This is so because the essence of making a will is the disposition of property, hence, it cannot be delegated to another.

B. Patent ambiguities- Those which are apparent on the face of the will: 1. Uncertainty which arises upon the face of the will as to the application of any of its provisions (Article 789, NCC).

Q: Does it mean that the testator himself, make the draft of the will without consulting a lawyer? A: No, the mechanical act of drafting the will may be entrusted to another, as long as the disposition of property expresses the testator’s desires. Q: What cannot be delegated to the discretion of a third person? A: The following cannot be delegated to third person because they comprise the disposing power of the testator: 1. Duration or efficacy of designation of heirs, legatees, or devisees. 2. Determination of the portions which are to receive when referred to by name. 3. Determination as to whether or not a disposition is to be operative. Q: What, on other hand, may be entrusted to third persons? A: The following may be entrusted to third persons: 1. Distribution of specific property or sums of money that the testator may leave in general to specified classes or causes 2. Designation of the persons, institutions or establishments to which such property or sums are to be given or applied. Reason: Here, there is really no delegation because the testator has already set the parameters required by law, namely: a. The specification of property or sums of money b. The specification of classes or causes. In effect, the third person will only be carrying out the will of the testator as determined by these parameters.

1. 2.

Q: What aspects of succession (testate or intestate) are governed by the national law of the decedent? A: The order of succession The amount of successional rights 3. The intrinsic validity of testamentary provisions 4. The capacity of the heir, legatee or devisee to succeed.

Steps in resolving the ambiguities: 1. Examine the will itself; 2. Refer to extrinsic evidence or the surrounding circumstances, except oral declarations of the testator as to his intention. Reason: Because the testator can no longer refute whatever is attributed to him. Rules in the Construction of Wills: 1. Words of the will are to be taken in their ordinary and grammatical sense unless there is a clear intention to use them in another sense can be gathered and ascertained. 2. Technical words are to be taken in their technical sense, unless: a. The context clearly indicates a contrary intention or b. It satisfactorily appears that he was unacquainted with such technical sense. 3. The invalidity of one of several dispositions contained in a will does not result in the invalidity of the other dispositions unless it is to be presumed that the testator would not have made such other dispositions if the first invalid disposition had not been made. 4. Every devise or legacy shall cover all the interest in the property disposed of unless it clearly appears from the will that he intended to convey a less interest. Validity of Wills/ Governing Law Kinds of Validity of Wills: 1.

Extrinsic validity – refers to the forms and solemnities required by law. a. As to time- the law in force at the time of the making of the will. b. As to place- The will can be executed in accordance to the formalities of the testator’s citizenship, domicile residence or the place where the will was executed.

2.

Intrinsic validity – refers to the legality of provisions in the will. a. As to time- the law in force at the time of the decedent’s death b. As to place- The national law of the testator governs the intrinsic validity of the will regardless of the place of execution.

Ambiguities in a Will Q: What are the kinds of ambiguities in a will? A: A. Latent ambiguities – Ambiguities which are not apparent on the face of a will but to circumstances outside the will at the time the will was made. Examples: 1. If it contains an imperfect description of person or property

Q: What are capacity? A: 1. by law 2. 3.

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the requisites of testamentary All persons not expressly prohibited At least 18 years of age Sound mind

29 CIVIL LAW NOTES

Q: What are the two kinds of wills? A: 1. Ordinary or Notarial will 2. Holographic will Q: What are the common requirements that apply to the two kinds of wills? A: 1. In writing 2. In a language or dialect known to the testator Q: What constitutes soundness of mind? A: Soundness of mind requires that at the time of making will, testator knows the: a. nature of estate to be disposed b. proper objects of his bounty c. character of the testamentary act 

Supervening incapacity does not invalidate an effective will nor is the will of an incapable validated by the supervening capacity.

Q: What are the formalities in the execution of a notarial will? A: Requirements of a notarial will: 1. In writing 2. Executed in a language or dialect known to the testator 3. Subscribed by the testator himself or by the testator’s name written by some other person in his presence and under his express direction at the end thereof, at the presence of witnesses 4. Attested and subscribed by at least 3 credible witnesses in the presence of the testator and of one another 5. Each and every page must be signed by the testator or by the person requested by him to write is name, and by instrumental witnesses in the presence of each other, on the left margin 6. Each and every page of the will must be numbered correlatively in letters placed on the upper part of each page 7. Must contain an attestation clause, stating the following: a. The number of pages of the will b. Fact that the testator signed the will and every page in the presence of witnesses, or caused some other person to write his name under his express direction c. All witnesses signed the will and every page thereof in the presence of the testator and of one another 8. Must be acknowledged before a notary public First Requirement: In writing  A will, whether notarial or holographic must be in writing. Oral wills are not allowed in the Philippines. Second Requirement: Written in dialect known to the testator  If the testator resides in a certain locality, it can e presumed that he know the dialect or

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

the language in the said locality. (Abangan vs. Abangan)  The fact that the testator knew the language need not appear on the face of the will. This fact may be proven by extrinsic evidence. Third Requirement: Subscribed by the testator himself or by the testator’s name written by some other person in his presence and under his express direction at the end thereof, at the presence of witnesses  A testator can sign with his thumb mark.  When somebody else writes the testator’s name for him, the mere placing by the testator of a cross after his name, without a statement in the will that somebody had signed for him is not sufficient. Reason: A cross cannot be constituted as the testator’s signature because it does not have the trustworthiness of a thumb mark.  Somebody else may sign the testator’s name for the latter, provided this is done in the latter’s presence and the latter’s express direction.  The person signing for the testator does not have to put his own name.  If the person who signs the name of the testator is one of the subscribing witnesses, the will remains valid if all other requisites are present (Barut vs Cabacungan) Fourth Requirement: Attested and subscribed by at least 3 credible witnesses in the presence of the testator and of one another  “In the presence” does not necessarily require actual seeing, but possibility of seeing without any physical obstruction. Fifth Requirement: Each and every page must be signed by the testator or by the person requested by him to write is name, and by instrumental witnesses in the presence of each other, on the left margin  It is immaterial where the signatures appear; it need not be in the left margin.  If the last page contains only the attestation clause, the testator need not sign on the margin.  If the whole will including the attestation clause consists of only one page, it need not be signed on the margin because this would serve no purpose, as the page already has the necessary signatures. (Abangan vs. Abangan) Sixth Requirement: Each and every page of the will must be numbered correlatively in letters placed on the upper part of each page  Purpose: To identify and authenticate the pages of the will to prevent the substitution of the pages thereof.  Subscription – is the signing of the witnesses’ names upon the same paper for the purpose of identifying such paper as the will which was executed by the testator.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

30 2007 Team Bar-Ops Civil Law Committee

 It is necessary to number the first page, as long as the attestation clause contains the number of pages consisting the will. Seventh Requirement: Attestation clause  Attestation Clause - record or memorandum of facts where the instrumental witnesses certify that the will has been executed before them and that it has been executed in accordance with formalities prescribed by law. It may not be in the language known to the witnesses but must be interpreted to them.  The attestation must contain the: 1. the number of pages used 2. that the testator signed or caused another to sign the will and every page thereof in the presence of the instrumental witnesses 3. The instrumental witnesses witnessed and signed the will and all the pages thereof in the presence of the testator and one another.  Attestation consists in witnessing the testator’s execution of the will in order to see and take note mentally that those things are done which the law requires for the execution of a will and that the signature of the testator exists as a fact.  The signatures of the witnesses on the left margin cannot be treated as signature in the attestation clause. (Cagro vs. Cagro) Reason: The signatures in the left margin are mere subscriptions. Attestation require more than the mere mechanical act signing. Eighth Requirement: Must be acknowledged before a notary public  Purpose: To affirm the fact that the execution of the will is a voluntary act.  Acknowledgement need not be a contemporaneous act.  Acknowledgement is a separate undertaking, it s not part of the execution of a will.  The notary public before whom the will is acknowledged cannot be one of the three instrumental witnesses. (Cruz vs. Villasor) Q: Is it necessary that the will is written in the language known to the attesting witnesses? A: No. The law does not require so. The content of the will may not be even known to the witnesses. Additional formalities in case: 1. Testator is Deaf/Deaf Mute – must personally read the will, if able, otherwise, he shall designate two persons to read it and communicate to him the contents thereof in the most practicable manner. 2. Testator is Blind - will shall be read to him twice, once by one of the subscribing witnesses and again, by the acknowledging notary public. Doctrine of Liberal Interpretation of Attestation Clause (Art 809, NCC) - Absent Bad Faith, Forgery, Fraud, Undue and Improper Pressure and Influence, defects and imperfections in the form of attestation or in the language used shall not render the will invalid if proved that the will was in fact

executed and attested in substantial compliance with the law.  The proof or evidence that may be admitted should be limited to that supplied by the will itself. Q: What are the qualifications of witnesses? A: Witnesses to a will must be: 1. of sound mind. 2. at least 18 years of age. 3. able to read and write 4. domiciled in the Philippines 5. not blind, deaf or dumb 6. not have been convicted by final judgment of falsification of a document, perjury or false testimony.  Subsequent incompetence of the attesting witnesses does not prevent the allowance of a will.  At least three witnesses are required to make a will valid. If one of the witnesses is a notary public before whom the will is acknowledged, the will is VOID.  The notary public who notarized the will cannot be a witness except only in addition to other three witnesses.  A witness who attests the execution of a will and to whom, or to whose spouse, or parent, or child, or anyone claiming the right of said witness, spouse, parent or child, a devise or legacy is given, such shall be void, unless there are three other competent witnesses to such will (Article 823, NCC).  Creditors of the estate or the testator can be witnesses. Q: What are the formalities required in the execution of holographic will? A: 1. Entirely written; 2. Dated; and 3. Signed by testator HIMSELF 4. Executed in a language or dialect known to him Insertion, Cancellation, Erasure or Alteration of Testamentary Provisions General rule: When a number of erasures, corrections, cancellation, or insertions are made by the testator in the will but the same have not been noted or authenticated with his full signature, only the particular words erased, corrected, altered will be invalidated, not the entirety of the will. Exception: When the holographic will had only one substantial provision, which was altered by substituting the original heir with another and the same did not carry the requisite full signature of the testator, the entirety of the will is voided or revoked. Reason: What was cancelled here was the very essence of the will; it amounted to the revocation of the will. Therefore, neither the altered text nor the original unaltered text can be given effect. (Kalaw vs. Relova) Probate of Holographic Wills (Art. 811) 1. If the will is uncontested, one witness is enough

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31 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

2. If the will is contested, three witnesses are required to testify on the authenticity of the holographic will. However, the three-witness rule, in case there is an opposition applies only when the opposition pertains to the authenticity of the will itself, not when the opposition is based on the presence of undue influence. (Azaola vs. Singson)  When the issue pertains to the authenticity of the holographic will, the three witness rule is a mandatory requirement. However, such requirement is not simply a matter of quantity of the witnesses but more on the quality or adequateness of their testimony.  In the case of Codoy vs. Calugay, six witnesses were presented by the proponents. SC held that although there is compliance with Art. 811, the testimonies of the six witnesses are inadequate to establish the existence of the holographic will.

Alien



Q: Can the contents and due execution of a lost holographic will be established merely through oral testimonies of witnesses who allegedly seen the same? A: No, the holographic will must be presented for probate, or at the very least a copy thereof. If there is no other copy available, the will cannot be probated because the best and only evidence is the handwriting of the testator in the said will. The law regards the holographic will itself as material proof of authenticity since it could at any time be demonstrated to be or not to be in the hands of the testator himself. (Gan vs. Yap) Q: May a holographic will which was lost or could not be found be proved by means of a photostatic copy (photocopy)? A: Yes, a photostatic copy may be allowed because comparison can be made with the standard handwritings of the testator. (Rodelas vs. Aranza) Joint Wills Q: What is a joint will? A: A joint will is one which contains in one instrument the will of two or more persons jointly signed by them.  A joint will executed by Filipinos, even if in a foreign country, is void.  Reason for the prohibition: A joint will cannot be revoked by one of the testators thereby rendering nugatory the ambulatory nature of wills. Formal Validity of Wills Made Either in the Philippines or Abroad Testator

Place of Execution

Filipino Filipino

Philippines Foreign Country Philippines

Alien

Applicable Law New Civil Code (NCC) Place of execution NCC NCC or

Foreign Country

National law Place of execution National law Place of residence NCC

Codicils Q: What is a codicil? A: A codicil is a supplement or addition to a will, made after the execution of a will and annexed to be taken as part thereof, by which any disposition made in the original will is explained, added to, or altered (Article 825, NCC).  A codicil is executed after the execution of a prior will.  It must be executed in accordance with all the formalities required in executing a will. Q: What is incorporation by reference? A: Incorporation by reference is the incorporation of an extrinsic document or paper into a will by reference so as to become a part thereof.

 The documents or papers incorporated will be considered part of the will even though the same are not executed in the form of a will.  The doctrine of incorporation by reference is not applicable in a holographic will unless the documents or papers incorporated by reference are also in the handwriting of the testator. Q: What are the requisites of incorporation by reference? Requisites: 1. Document referred to in the will must be in existence at the time of the execution of the will; 2. The will must clearly describe and identify the same; 3. It must be identified by clear and satisfactory proof as the document or paper referred to therein; 4. It must be signed by the testator and the witnesses on each and every page, except in case of voluminous books of account or inventories (Article 827, NCC). REVOCATION OF WILLS  A will is ambulatory; it is revocable any time during the lifetime of the testator for any cause and for any reason or for no reason at all.  The testator’s right to revoke during his lifetime is absolute. It can neither be waived nor restricted. 1. Revocation by implication of law – Revocation produced by operation of law when certain acts or events take place after a will has been made, rendering void or useless either the whole will or certain testamentary dispositions therein. Rationale: The law presumes a change of mind on the part of the testator due to certain

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

32 2007 Team Bar-Ops Civil Law Committee

changed circumstance pertaining to the family relations or in the status of the property. Examples: a. When after the testator has made a will, he sells or donates the legacy or devise; b. Provisions in a will in favor of a spouse who has given cause for legal separation shall be revoked by operation of law the moment the decree of legal separation is granted. c. When an heir, legatee or devisee commits an act of unworthiness; d. When accredit that had been given as a legacy is judicially demanded by the testator; e. When one, some or all the compulsory heirs have been preterited or omitted, the institution of heirs is void. 3. By some will, codicil, or other writings executed as provided in case of wills: a. Express - provides revocatory clause b. Implied - provisions are completely inconsistent with previous will  The testator must have the testamentary capacity at the time of the making of the subsequent will.  The will containing the revocatory clause must itself be valid, otherwise, there is no revocation.  In case of inconsistent wills, the subsequent will prevails over the prior will because it is the latest expression of testamentary intent of the testator. 4. Burning, tearing, canceling or obliterating a will (Physical Act of Destruction) Requisites of revocation by physical act of destruction: a. Actual physical act of destruction b. Testamentary capacity of the testator c. Intention to revoke d. Performed by testator himself or other person in the presence and express direction of the testator. Q: What is the doctrine of presumed revocation? A: The doctrine of presumed revocation provides that where it is established that the testator had in his possession or had access to the will, but it cannot be found or located upon his death, the presumption is that he must have revoked the will by overt act. (Gago vs. Mamuyac)  The presumption is, however, not conclusive and anyone who has proof to the contrary may rebut the presumption. Doctrine of Dependent Relative Revocation Where the testator’s act of destruction is connected with the making of another will, so as fairly to raise the inference that the testator meant the revocation of the old to depend upon the efficacy of the new disposition intended to be substituted, the revocation will be conditional and dependent upon

the efficacy of the new disposition; and if, for any reason, the new will intended to be made as a substitute is inoperative, the revocation fails and the original will remains in full force.(Molo vs.Molo) Simply put, for this doctrine to operate, the testator must have intended that the revocation of his first will is dependent on the validity of his second will. In this case the intention of the testator is clear: He does not want to die intestate. Principle of Instanter Express revocation of the first will renders it void because the revocatory clause of the second will operates to revoke the previous will INSTANTLY upon the execution of the will containing it.  Revocation of a will based on a false cause or an illegal cause is null and void.  Recognition in a will of an illegitimate child does not lose its legal effect even if the will is revoked. REPUBLICATION AND REVIVAL OF WILLS Q: What is republication? A: Republication is the act of testator where he reproduces in a subsequent will the dispositions contained in a previous will which is void as to form, or he executes a codicil to his will

 A will that is void as to its form may be republished by reproducing or copying all the dispositions in the new or subsequent will. (Re-execution)  A will that is valid as to form and has earlier been revoked may be republished by executing a codicil which makes reference to the revoked will. (Republication by virtue of a codicil) Q: What are the effects of republication by virtue of a codicil? A: 1. The codicil revives the previous will; 2. The will is republished as of the date of the codicil; Q: What is revival? A: Revival is the restoration to validity of a previously revoked will by operation of law Examples of Revival: 1. When a compulsory heir is preterited, the institution of heirs is annulled. However, if the preterited heir predeceased the testator, the institution is revived, without prejudice to the right of representation; 2. If after making a will, the testator makes a second will impliedly revoking the first, the revocation of the second will revives the first will. ALLOWANCE AND DISALLOWANCE OF WILLS Special proceedings establish validity of a will Characteristics of Probate Proceedings

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1. Special proceedings 2. Proceedings IN REM 3. Not contentious litigation 4. Mandatory

to

33 CIVIL LAW NOTES

Questions Determinable in Probate Court

Kinds of Probate

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

5. Imprescriptible 1. Due execution 2. Testamentary capacity 3. Identity of the will GR: Probate court cannot inquire into intrinsic validity of will XPN: Practical considerations (like when will void on its face) 1. ante-mortem – testator himself petitions the court for the probate of his own will 2. post-mortem – another person applies for probate of the will after the testator’s death

No will shall pass either real or personal property unless it is proved and allowed in accordance with the Rules of Court. (Art. 838) Q: What is the meaning of probate? A: Probate is the act of proving before a competent court the due execution of a will by a person possessed with testamentary capacity, as well as the approval of the court.  Probate does not deal with the intrinsic validity of the testamentary provisions.  Even if only one heir has been instituted, there must still be a judicial order of adjudication.  Even if a will has already been probated, if later on a subsequent will is discovered, the latter may still be presented for probate, as long as two wills can be reconciled.  General rule: A probate court has no jurisdiction to decide questions of ownership. Exceptions: 1. When the parties voluntary submit the issue of ownership to the court; 2. When provisionally, the ownership is passed upon to determine whether or not the property involved is part of the estate.  The question of ownership is an extraneous matter which the probate court cannot resolve with finality. Q: What are the grounds for disallowance of a will? 1.

2. 3. 4. 5. 6.

The formalities required by law have not been complied with; The testator was Insane or mentally incapable of making will; The will was executed through force or under duress, or influence of fear or threats; The will was procured by undue and improper pressure and influence, on part of the beneficiary or some other person; The signature of testator was procured by fraud (Article 839, NCC). The testator acted by mistake or did not intend that the instrument he signed should be his will;

Q: What are the distinctions between disallowance and revocation? Disallowance Revocation It is given by judicial It is a voluntary act of order. the testator.

There must always be a legal cause. As a rule, disallowance is always total, except when the ground of fraud or undue influence affects only certain portions of the will.

Revocation can be had with or without a cause. It may be partial or total.

Q: Manuel, a Filipino, and his American wife Eleanor, executed a Joint Will In Boston, Massachusetts when they were residing in said dry. The law of Massachusetts allows the execution of joint wills. Shortly thereafter, Eleanor died. Can the said will be probated in the Philippines for the settlement of her estate? A: Yes, the will may be probated in the Philippines insofar as the estate of Eleanor is concerned. While the Civil Code prohibits the execution of joint wills here and abroad, such prohibition applies only to Filipinos. Hence, the joint will which is valid where executed is valid in the Philippines but only with respect to Eleanor. Under Article 819, it is void with respect to Manuel whose joint will remains void in the Philippines despite being valid where executed. (Bar Question, 2000) Institution of Heir INSTITUTION OF HEIRS Q: How is institution of heir defined under Art. 840? A: Institution of heir is an act by virtue of which a testator designates in his will the person or persons who are to succeed him in his property and transmissible rights and obligations (Article 840, NCC).  Institution cannot be allowed to affect the legitime.  There can be an instituted heir only in testamentary succession.  A conceived child may be instituted, provided the conditions in Arts. 40 and 41 are present. Q: What are the requisites of a valid institution? A: 1. The will must be extrinsically valid; 2. The institution must be valid intrinsically (the legitime must not be impaired, the heir must be certain or ascertainable; there should be no preterition); 3. the institution must be effective (no predecease, no repudiation by the heir) Q: What are the three principles in the institution of heirs? A: 1. Equality: heirs who are instructed without a designation of shares inherit in equal parts 2. Individuality: heirs collectively instituted are deemed individually named unless contrary intent is proven

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

34 2007 Team Bar-Ops Civil Law Committee

3. Simultaneity: when several heirs are instituted, they are instituted simultaneously and not successively PRETERITION (Article 854, NCC) Q: What is preterition? A: Preterition is the omission in testator’s will of one, some or all of the compulsory heirs in direct line , whether living at time of execution of will or born after death of testator.

Q: What are the requisites of preterition? A: 1. There is a total omission in the inheritance; 2. The omission must be of a compulsory heir; 3. The compulsory omitted must be in the direct line; 4. The omitted compulsory heir must survive the testator; 5. Nothing must have been received by the heir by gratuitous title.

 If a compulsory heir is given a share in the inheritance, no matter how small, there is no preterition.  If a compulsory heir has already received a donation from the testator, there is no preterition.  Reason: A donation to a compulsory heir is considered an advance of the inheritance.  If a compulsory heir gets less than his legitime, this is not a case of preterition. He is, however, entitled to a completion of his legitime under Art. 906.  A spouse, although a compulsory heir, is not in the direct line. Hence, there is no preterition of a surviving spouse.  The omission of one or both parents constitutes preterition when there are no legitimate children or descendants. Q: What are the effects of preterition? A: 1. Preterition annuls the institution of heirs; 2. Devisees and Legacies are valid insofar as they are not inofficious; 3. If omitted compulsory heir dies before testator, institution shall be effectual , without prejudice to right of representation  The universal institution of heirs to the entire inheritance of the testator results in totally abrogating the will because the nullification of such institution of the universal heirswithout any other testamentary disposition in the will- amounts to a declaration that nothing at all was written.  In other words, the effect of annulling the institution of heirs will be, necessarily, the opening of a total intestacy except that proper legacies and devises must be respected. Substitution of Heirs Q: What is substitution? A: Substitution is the appointment of another heir so that he may enter into the inheritance in default of original heir.

Q: What are the different kinds of substitution? A: 1. Simple/Common - takes place when the heir instituted: a. predeceases testator; b. repudiates the inheritance; or c. is incapacitated to succeed  Simple substitution without a statement of the causes to which it refers, shall comprise the 3 above mentioned situations. 2. Brief/Compendious –When two or more persons are substituted for one OR one person for two or more heirs. 3. Reciprocal -one heir designated as substitute for instituted heir while latter is simultaneously instituted as substitute for former.  The substitute enters into the inheritance not as an heir succeeding the first heir, but as an heir of the testator.  General rule: The substitute is subject to the same charges and conditions imposed upon the instituted heir.  Exceptions: 1. If the testator has expressly provided the contrary; 2. if the charges and conditions are personally applicable only to the instituted heir. 4. Fideicommissary Substitution (Indirect substitution)- It is a substitution by virtue of which the fiduciary or first heir instituted is entrusted with the obligation to preserve and transmit to a second heir the whole or part of the inheritance, shall be valid and shall take effect, provided such substitution does not go beyond one degree from the heir originally substituted and provided further, that the fiduciary or first heir and the second heir are living at the time of death of the testator. Q: Who are the parties to a fideicommissary substitution? What are their respective obligations? Parties First heir fiduciary

or

Second heir or fideicommissary Testator

Obligations He has the obligation to preserve and transmit the inheritance. He eventually receives the property from the fiduciary.

Q: What are the elements/requisites fideicommissary substitution?

of

1. There must be a first heir or fiduciary.  The first heir receives property, either upon the death of the testator or upon the fulfillment of any suspensive condition imposed by the will.  The first heir is almost like a usufructuary with right to enjoy the property. Thus, like a usufructuary, he cannot alienate the property.  The first heir obliged to make an inventory but he is not required to furnish a bond.

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35 CIVIL LAW NOTES

2. An absolute obligation is imposed upon the fiduciary to preserve and to transmit to a second heir the property at a given time.  The obligation to preserve and transmit must be given clearly and expressly by giving referring it as “fideicommissary substitution” or by imposing upon the first heir the absolute obligation to preserve and deliver the property to the second heir.  "Given time" means the time provided by the testator; if not provided, then it is understood that the period is the lifetime of the first heir. 3. There is a second heir who must be one degree from the first heir.  "One degree" refers to the degree of relationship, it means “one generation”.  As such, the fideicommissary can only be either a parent or child of the first heir.  The relationship is always counted from the first heir.  However, fideicommissary substitutions are also limited to one transmission. Upon the lapse of time for the first heir, he transmits the property to the second heir. In other words, there can only be one fideicommissary transmission such that after the first, there can be no second fideicommissary substitution. 4. The first and second heir must both be living and qualified at the time of the death of the testator.  The fideicommissary inherits not from the first heir but from the testator. Thus, the requirement that the fideicommissary be alive or at least conceived at the time of the testator’s death.  From the moment of the death of the testator, the rights of the first heir and the fiduciary are vested.  Both the first heir and the fideicommissary inherit the property simultaneously, although the enjoyment and possession are successive.  If the first heir was able to register the property in his name, fideicommissary should annotate his claim on the land on the title to protect himself against any alienation in favor of innocent third parties.  When the property passes to the fideicommissary, there is no more prohibition to alienate.  The nullity of the fideicommissary substitution does not prejudice the validity of the institution of the heirs first designated; the fideicommissary clause shall simply be considered as not written.  The provisions on fideicommissary substitution also applies in a case where the testator gives the usufruct to various persons successively.

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Q: What are the distinctions between direct and indirect substitution? Direct Substitution Indirect Substitution (Fideicommissary Substitution) When the substitute receives the property in default of the first heir instituted who does not or can not receive the same. There are various liberalities, one that is immediate and the other or others eventual, but with only one of them effective (because ultimately either the instituted heir succeeds or it is the substitute). The testator so directs the transmission of his property that one or more heirs enjoy and may freely dispose of the same. No other purpose than to prevent the succession of the intestate heirs.

There is only one transfer.

Has the free and absolute disposition and control over the property.

The identity of the substitute does not matter.

When the substitute receives the property after the heir first instituted has enjoyed the same for sometime. There are two liberalities which are both effective but successively enjoyed.

The first heir instituted is obliged to preserve the property for the benefit of one or more succeeding heirs and his power of alienation is curtailed or at least limited. Has a further social effect because it limits the free circulation of property and for such reason many laws prohibit the same or limit it. There are 2 transfers – one to the fiduciary and the other to the fideicommissary. No absolute disposition because it is subject to the condition that he will preserve and transmit the same to the fideicommissary. And also, there is control on the property but there is a limit to the circulation of the property. The fideicommissary is limited to relatives within one degree from the first heir or fiduciary – parent/child.

Prohibition to Alienate Rule: The dispositions of the testator declaring all or part of the estate inalienable for more than twenty years are void. (Art. 870)

 The

prohibition does not apply to fideicommissary substitution. It refers to simple institution of heir, devisee or legatee.  The prohibition also does not apply to the legitime, even if the prohibition is less than 20 years.  Reason: The legitime cannot be burdened by any condition. Q: Can the prohibition to alienate go beyond 20 years? A: No, but it is valid for the first 20 years, it is void as to the excess.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

36 2007 Team Bar-Ops Civil Law Committee

CONDITIONAL TESTAMENTARY DISPOSITIONS AND TESTAMENTARY DISPOSITIONS WITH A TERM Q: What are the various kinds of institution? A: Institution of heir may be: 1. with a condition 2. with a term 3. for a certain purpose or cause (modal institution) CONDITION Condition is future or uncertain event or a past event unknown to the parties, upon which the performance of an obligation depends. Kinds: 1. Suspensive condition gives rise to the right if it happens. 2. Resolutory condition extinguishes the right if it happens. Resolutory Condition

Suspensive Condition

The disposition becomes effective upon the death of the testator but is extinguished upon the happening of the condition.

The effectivity of the disposition is dependent upon the fulfillment of the condition.

Q: What is the effect of an impossible condition on the testamentary disposition? A: If an impossible condition is imposed, the condition is deemed not imposed. The testamentary disposition becomes pure, absolute and unconditional. Impossible conditions include those which are illegal, against public order and public policy. Q: What is the rule on the imposition of condition, charge or burden regarding the legitimes? A: General rule: The testator cannot impose any charge, condition or substitution whatsoever upon the legitimes. If a charge condition or substitution is imposed, it shall be considered as not imposed. Exception: The testator can validly impose a prohibition against the partition of the legitime for a period not exceeding 20 years. Condition Prohibiting Marriage-Rules: 1. If the condition is on the first marriage- The condition is considered as not imposed. 2. If the condition is imposed on the second marriage – General rule: The condition is deemed as not imposed. Exception: The condition is valid if imposed by: (a) deceased spouse; (b) ascendants of the spouse; (c) descendants of the spouse. Q: What are the kinds of suspensive conditions? A: 1. Purely Potestative- The fulfillment of the condition depends solely upon the will of the heir, devisee or legatee. General rule: The condition must be fulfilled as soon as the heir learns of the testator's death. Exception: If the condition has already been fulfilled and it cannot be fulfilled again, the condition is deemed fulfilled.

2. Casual- The fulfillment of the condition depends solely on chance or on the will of a third person. 3. Mixed- The fulfillment of the condition depends partly on chance and partly on the will of the heir, devisee, or legatee. Rules for casual and mixed conditions: General rule: The condition may be fulfilled any time, either before or after the testator's death unless the testator provides otherwise. Reason: It is not within the heir, devisee or legatee's control. Qualification: If condition is already fulfilled at the time of the execution. a. Testator is unaware- The condition is deemed complied with or fulfilled. b. Testator is aware- (1)If the condition can no longer be fulfilled again, it is deemed fulfilled; (2)If the condition can still be fulfilled, fulfill it again. Q: What is the effect if the suspensive condition is not fulfilled? A: If the suspensive condition is not fulfilled, the estate will be placed under administration until: 1. The condition is fulfilled, in which case the estate should be given to the instituted heir; 2. It becomes obvious that it cannot be fulfilled, in which case, the estate should be given to the intestate heirs. TERM  A disposition with a suspensive term does not prevent the instituted heir from acquiring his rights and transmitting them to his heirs even before the arrival of the term.  Reason: The right of the heir instituted subject to a term is vested at the time of the testator's death- he will just wait for the term to expire.  If the heir dies after the testator but before the term expires, he transmits his rights to his own heirs because of the vested right. Suspensive Term The right of the heir instituted subject to a term is vested at the time of the testator's death. Hence, if he dies after the testator but before the term expires, he can transmit his rights to his own heirs.

Suspensive Condition The heir enters into the inheritance only when he is alive and qualified at the time of the testator's death and when the condition happens. (Art. 1034, par. 3)

The death of the instituted heir before the arrival of the term does not annul the institution.

The death of the instituted heir before the fulfillment of the condition annuls the institution.

Q: When the disposition is subject to a term, what should be done by the instituted heirs or legal heirs so that they can enjoy possession of the property? A: Distinguish whether the term is suspensive or resolutory. 1. Suspensive term- The legal heirs can enjoy possession of the property until the expiration of the period but they must put up a bond (caucion

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37 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

muciana) in order to protect the right of the instituted heir.

(Origin)

2. Resolutory term - The legal heirs can enjoy possession of the property but when the term arrives, he must give it to the legal heirs. The instituted heir does not have to file a bond.

C (Propositus) Q: What are the requisites of reserve troncal? A: Requisites of Reserva Troncal: 1. The property was acquired by a person from an ascendant of from a brother or sister by gratuitous title. 2. Said person died without legitimate issue. 3. The property is inherited by another ascendant by operation of law. 4. There are relatives within the third degree belonging to the line from which said property came.

MODE Q: What is a mode? A: A mode is an obligation imposed upon the heir to do or to give something.

Q: Who are the parties in reserve troncal? A: 1. ORIGIN

Modal Institution - statement of: 1.) object of the institution; 2.) application of the property left by the testator; 3.) charge imposed by him.

 The origin of the property must be an ascendant, brother or sister.  The origin must be a legitimate relative because reserve troncal exists only in the legitimate family.  The transmission from the origin to the propositus must be by gratuitous title.  While the origin owns the property, there is no reserve yet, and therefore, he has the perfect right to dispose of it, in any way he wants, subject, however to the rule on inofficious donations.

Q: What are the distinctions between a mode and a condition? Mode Condition Suspends the existence and demandability of the right Never obligatory

In case of doubt between a mode and a condition, resolve in favor of mode. Q: What is a disposicion captatoria? A: A disposicion captatoraia is any disposition made upon the condition that the heir shall make some provision in his will in favor of the testator or of any other person shall be void. Here, both the condition and the disposition are void. Reason for the prohibition: It is against public policy because it impairs the voluntariness of wills. It tends to make the making of the will a contractual act. RESERVA TRONCAL Q: What is reserve troncal? A: Reserva troncal- The ascendant who inherits from his descendant any property which the latter may have acquired by gratuitous title from another ascendant, or a brother or sister, is obliged to reserve such property as he may have acquired by operation of law for the benefit of relatives who are within the third degree and who belong to the line from which said property came. (Art. 891) Purpose: To prevent persons who are outsiders to the family from acquiring, by chance or accident, property which otherwise would have remained with the said family. In short, to put back the property to the line from which it originally came.

F (Reservista)

(Reservatarios) 3rd degree relatives

Q: What is caucion muciana? A: A caucion muciana is a security to be put up to protect the right of the heirs who would succeed to the property in case the condition, term or mode is violated. Instances when caucion muciana is needed: 1. Suspensive condition 2. Negative potestative condition 3. Mode

Does not suspend the effect of the liberality of the testator Obligatory except when it is for the exclusive benefit of the person concerned

M

2.

PROPOSITUS  The propositus must be a legitimate descendant of the origin of the property.  To give rise to reserve troncal, the propositus must not have any legitimate children, otherwise, the reservable property will be inherited by the latter  The presence of illegitimate children of the propositus will not prevent his legitimate parents or ascendants from inheriting the reserved property.  The propositus is the descendant whose death gives rise to the reserve, and from whom therefore the third degree is counted.  While propositus is still alive, there is no reserva yet, therefore, he is the absolute owner of the property, with full freedom to alienate or dispose or encumber.  Inasmuch as the propositus is the full owner of the property, he may even defeat the existence of any possible reserve by simply not giving the property involved to his ascendant, by way of inheritance by operation of law.  The propositus is referred to as the “arbiter of the reserva”.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

38 2007 Team Bar-Ops Civil Law Committee

3.

RESERVISTA  The reservista is the ascendant who inherits from the propositus by operation of law. It is he who has the obligation to reserve.  The relationship between the reservista and the propositus must be legitimate.  If he inherited the property from the propositus, not by legal succession or by virtue of legitime, there is no obligation to reserve.  The reservista is an absolute or full owner, subject to a resolutory condition. If the resolutory condition is fulfilled, the reservista’s ownership of the property is terminated.  Resolutory condition: If at the time of the reservista’s death, there should still exist relatives within the third degree (reservatarios) of the propositus, and belonging to the line from which the property came.  The reservista cannot transmit mortis causa the reservable property to his own successors so long as a reservatario exists.  The reservista can alienate the property being the owner thereof but subject to the reservation.  He is required to furnish a bond, security or mortgage to guarantee the safe delivery later on to the reservatarios of the properties concerned, in the proper cases.  However, the bond, security or mortgage is not needed when the property has been registered or annotated in the certificate of title as subject to reserve troncal.  Upon the reservista’s death the ownership of the reserved properties is automatically vested to the reservatarios who are existing. Hence, the reservista cannot dispose the reserved property by will if there are reservatarios existing at the time of his death.

4.

RESERVATARTIOS/RESERVEES  The reservatarios are relatives within the third degree (from the propositus) who will become the full owners of the property the moment the reservista dies, because by such death, the reserve is extinguished.  Requisites for passing of title to the reservatarios are: a. death of the reservista; and b. the fact that the reservatarios survived the reservista.  The reservatarios inherit the property from the propositus, not from the reservista.  The reservatarios must be legitimate relatives of the origin and the propositus.  Reserva troncal is governed by the following rules on intestate succession: (Applicable when there are concurring relatives within the third degree) 1. Proximity- “The nearer excludes the farther” 2. “The direct line is preferred over the collateral line” 3. “The descending line is preferred over the ascending line”

 Relatives within the third degree from the propositus: 1. parents; 2. grandparents; 3. full and half brothers and sisters; 4. great grandparents, 5. nephews and nieces; Q: What are the causes for the extinguishment of the reserva? A: 1. Death of the reservista 2. Death of all the relatives within the third degree prior to the death of the reservista 3. Accidental loss of all the reservable properties 4. Renunciation or waiver by the reserves or reservatarios 5. Registration under Act 496 without the reservable character being annotated if it falls into the hands of a buyer in good faith for value 6. By prescription- reservista seeks to acquire (30 years – immovable; 8 yearsmovable) LEGITIME Q: What is legitime? A: A legitime is that part of testator’s property which he cannot dispose of because law has reserved it for certain heirs called compulsory heirs.  There is compulsion on the part of the testator to reserve that part of the estate which corresponds to the legitime.  The testator cannot deprive the compulsory heirs of their legitimes, except through disinheritance.  The law does not specify which property to reserve but only sets aside a fractional portion of the estate.  There is no obligation on the compulsory heirs to accept.  Only the legitime is reserved. The free portion may be disposed of by will. Q: What are the limitations imposed on the testator regarding his rights of ownership? A: The testator cannot make donations inter vivos which impinge upon the legitime or which are inofficious.

 The prohibition does not cover an onerous disposition (sale) because this involves an exchange of values. Q: What re the classifications of legitimes? 1. fixed- legitime never changes (legitimate children’s legitime is always ½ ) 2. variable- legitime varies Q: What are the factors which affect the legitime? 1. identity of the concurring compulsory heirs and; 2. number of concurring compulsory heirs. Q: What burdens or conditios can be imposed on the legitime?

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39 CIVIL LAW NOTES

A: None, because the right of the compulsory heirs to the legitime is almost absolute. The only burden allowed to be imposed is the prohibition against partition for a period not to exceed 20 years. Q: What are the classifications of compulsory heirs? 1. Primary compulsory heirs- They are not excluded by the presence of other compulsory heirs. Examples: legitimate children, surviving spouse 2. Secondary compulsory heirs- Those who succeed only in default of the primary compulsory heirs. Example: legitimate ascendants 3. Concurring compulsory heirs- They get their legitimes together with the primary or secondary heirs. Neither exclude primary or secondary heirs nor each other. Example: Surviving spouse and illegitimate children. Q: Who are the compulsory heirs? A: 1. Legitimate children and descendants (LCD)  “Legitimate children” includes adopted children and legitimated children.  Under RA 8552 or the Domestic Adoption Law adopted children has the same rights granted to the legitimate children. Adopted children, for all intents and purposes is considered as legitimate children.  Hence, the adopted children can already exclude legitimate parents/ascendants. 2. Legitimate parents and ascendants (LPA)  Legitimate parents and ascendants inherit in default of legitimate children and descendants.  Illegitimate children of the decedent do not exclude the legitimate parents and ascendants.  Legitimate parents and ascendants concur with the illegitimate children of the decedent.  However, if the decedent is himself illegitimate, his illegitimate children excludes the illegitimate parents and ascendants.  “Illegitimate parents” means parents of the illegitimate decedent.

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

 However, in case of voidable marriages, if the marriage is not annulled before the decedent died, the surviving spouse still inherits. Reason: Voidable marriages can only be attacked in a direct proceeding, i.e. annulment proceeding. 4. Illegitimate children (Acknowledged natural children, and natural children by legal fiction and other illegitimate children)  Under the Family Code, there is no more distinction between acknowledged natural children and illegitimate children. They are all considered as illegitimate. Q: In what ways compulsory heirs inherit? A: Compulsory heirs inherit either: 1. in their own right; or 2. by right of representation Kinds of Legitime 1. Fixed - if the amount (fractional part) does not vary or change regardless of whether there are concurring compulsory heirs or not. a. legitimate children and descendants b. legitimate parents and ascendants 2. Variable - if the amount changes or varies in accordance with what the compulsory heir concur. a. surviving spouse b. illegitimate children c. parents of the illegitimate child Q: What is/are the remedy/remedies available to a compulsory heir whose legitime has been impaired? A: 1. In case of preterition - annulment of institution of heir and reduction of devises and legacies 2. In case of partial impairment - completion of legitime 3. In case inofficious donation -collation Steps in the Distribution of the Estate of the Testator: 1. Determine the value of the property left at the death of the testator. (Gross estate) 2. Deduct all debt and charges, except those imposed in the will from the gross estate. 3. Add the value of all donations by the testator that are subject to collation. (Net hereditary estate = Gross estate + donations)

3.

Surviving spouse (SS)

 There must be valid marriage between the decedent and the surviving spouse. If the marriage is null and void, the surviving spouse cannot inherit. Q: How can the heirs of the decedent use the nullity of marriage to prevent the surviving spouse from inheriting? A: The heirs can raise the issue of nullity of the marriage in the same proceeding for the settlement of the estate. This is allowed because a marriage that is null and void can be collaterally attacked.

4. Determine who are the compulsory heirs and their corresponding legitimes using the table of legitimes below. 5. Determine the free portion. Free portion = net hereditary estate – legitimes (total amount)

6. Imputation of donations 7. Distribution of the remaining portion to the legatees and devisees.  Donations inter vivos given to children shall be charged to their legitime, unless otherwise provided by the testator. Reason: Donations to the compulsory heirs are advances to the legitime.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

40 2007 Team Bar-Ops Civil Law Committee

 Donations inter vivos to strangers shall be charged to the free portion. DISINHERITANCE Q: What is disinheritance? A: Disinheritance is the process or act, thru a testamentary disposition of depriving in a will any compulsory heir of his legitime for true and lawful cause.  The only way in which a compulsory heir can be deprived of his legitime is through valid disinheritance.  Disinheritance is not automatic. There must be evidence presented to substantiate the disinheritance and must be for a valid and sound cause.  Effect of Disinheritance: Total exclusion to the inheritance, meaning, loss of legitime, right to intestate succession, and of any disposition in a prior will.  Disinheritance, however, is without prejudice to the right of representation of the children and descendants of the person disinherited.  BUT the disinherited parent shall not have the usufruct or administration of the property which constitutes the legitime. Q: What are the requisites of a valid disinheritance? A: Disinheritance must be: 1. Made in a valid will 2. Identity of the heir is clearly established 3. For a legal cause 4. Expressly made 5. Cause stated in the will 6. Absolute or unconditional Total 7. Cause must be true and if challenged by the heir, it must be proved to be true (proponent of disinheritance has the burden of proof.) Causes for Disinheritance Legend: Children/Descendants (C/D) Parents/Ascendants (P/A) Spouse (S) Testator (TR) X – means that the ground on the left side of the table is also a ground either in the disinheritance of C/D, P/A, or S

Grounds Guilty/convicted of attempt against life of TR/spouse/ ascendant/descendant Accusation of a crime punishable by imprisonment of more than 6 years, if groundless, false Causes TR to make will or change one by fraud, violence, intimidation, or undue influence Unjustified refusal to support testator Conviction of adultery or concubinage with spouse of TR Maltreatment of TR by word and deed Leading a dishonorable or disgraceful life Conviction of crime which carries penalty of civil interdiction Abandonment of children or inducing children to live corrupt and immoral life or attempted against virtue Loss of parental authority

C/D x

P/A S x x

x

x

x

x

x

x

Attempt by one parent against life of the other UNLESS there is reconciliation between parents Spouses given cause for legal separation

x

x

DISCUSSION: Grounds for Disinheritance 1. Attempt against the life, etc.  Final conviction is necessary.  "Attempt" is a generic term which includes all kinds of commission, whether frustrated or consummated. Intent to kill must be present. 2. Accusation.  a. “Accusation” is a generic term which includes: (i)filing of an information; (ii) presenting incriminating evidence; (iii) acting as a witness against the ascendant.  b. Imprisonment of more than six (6) years  c. Accusation is groundless- Ascendant is acquitted on the finding that: (i)there is no crime; or (ii)that the ascendant did not commit it.  If the ascendant was acquitted on reasonable doubt, the ascendant cannot disinherit because the accusation is not groundless. 3.

Adultery and concubinage

 Conviction is required. 4. Fraud, violence, intimidation influence as regards the will

or

undue

 This goes into the very essence of will-making. 5.

Refusal to support without justifiable cause

 Refusal, itself, is not a ground; it must be unjustified.  Example: The person may be willing to support but it is not economically feasible. There is here a justified refusal. 6. Maltreatment.  No conviction is required as compared to “attempt against the life” wherein conviction is needed.  This may be proven by preponderance of evidence. 7. Leads a dishonorable life

x x

x x

x

x x

 "Leads" denotes habituality.  Dishonorable and disgraceful are based on the sense of the community as perceived by the judge. It is not limited to sexual immorality.

x

8. Civil Interdiction x x

 Conviction is required.  Civil interdiction is an accessory penalty that goes with the principal penalty of reclusion temporal and up.

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41 CIVIL LAW NOTES

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of donation inter vivos

9. Abandonment, etc.  Abandonment by a parent of his children  Induced their daughter to live a corrupt or immoral life- It includes grandparents to granddaughters.  Attempt against their virtue- Mere attempt is enough as long as it can be proven. N.B. In all 3 cases, conviction is not required. 10. Loss of parental authority  Loss of parental authority is a ground for disinheritance only if there is fault on the part of the heir. 11.

The spouse has given cause for legal separation

 A decree of legal separation is not essential nor is a final judgment in a criminal case required.  If there is legal separation, the testator does need to disinherit. Disinheritance takes place by operation of law. Q: What is reconciliation? A: There is reconciliation when two persons who are at odds decide to set aside their differences and to resume their relations. They need not go back to their old relation.  A handshake is not reconciliation. It has to be something more. It must be clear and deliberate.  In disinheritance, reconciliation need not be in writing. Q: What is the effect of reconciliation on a person’s right to disinherit? A: a. If there is no will- It deprives the offended person of his right to disinherit the offending person. b. If already disinherited- It sets aside disinheritance already made. Q: What are the distinctions between a valid disinheritance and preterition? A: Valid Disinheritance Preterition Disinheritance intentional.

is

always

The cause must always be stated in the will; it must be true and legal. Always intentional The disinherited heir receives nothing. (either by way of legitime or intestate succession) There must always be a will.

The omission may be either intentional or unintentional. It may be with or without cause. Intentional Unintentional Preterition annuls institution of heirs

or the

It may exist with or without a will (as when everything has been given to only one of the compulsory heirs by way

Q: What are the distinctions and similarities between imperfect disinheritance and preterition? A: Imperfect Preterition Disinheritance DISTINCTIONS: The institution remains The institution of heirs is valid, but must be reduced completely annulled. insofar as the legitime has been impaired. SIMILARITIES: In both cases, the omitted heir and the imperfectly disinherited heir get at least their legitime In both, the legacies and devises remain valid insofar as the legitime has not been impaired. Both refer to compulsory heirs.

Q: What are the defenses that the disinherited compulsory heir may avail? A: 1. Have the will declared void – disinheritance depends upon a valid will OR 2. If will is declared valid, contest the reason for the disinheritance as not being one provided for by the law, or contest the authenticity of cause LEGACIES AND DEVISES Legacy - testamentary disposition by virtue of which a person is called by testator to inherit an individual item of personal property Devise - testamentary disposition by virtue of which a person is called by the testator to inherit an individual item of real property Q: What can be bequeathed or devised? A: Anything within the commerce of man or which is alienable. Q: Can the testator bequeath or devise a thing or property belonging to someone else? A: It depends on the situations below. First situation: The testator thought that he owned it. General rule: A legacy or devise of a thing belonging to someone else when the testator thought that he owned it is a void legacy or devise because it is vitiated by mistake. Exception: If the testator acquires it after making his will. Second situation: The testator knows that he does not own but ordered its acquisition. If the thing given as devise or legacy is not owned by the testator at the time he made the will but he orders his estate to acquire it, it is a valid legacy or devise. The testator knew that he did not own it. There is no mistake. Art. 933. If the thing bequeathed belonged to the legatee or devisee at the time of the execution of the will, the legacy or devise shall be without effect, even though it may have been subsequently alienated by him.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

42 2007 Team Bar-Ops Civil Law Committee

If the legatee or devisee acquires it gratuitously after such time, he can claim nothing by virtue of the legacy or devise; but if it has been acquired by onerous title he can demand reimbursement from the heir or the estate. Q: What is the effect if the thing or property bequeathed or devised belonged to the legatee or devisee at the time the will was executed? A: The legacy or devise is ineffective even if the legatee or devisee alienates the thing after the will is made. Q: Suppose the legatee or devisee acquired the property after the will has been executed? Suppose he acquired the thing by onerous title? What would be the effect? A: If at the time the legacy or devise is made, the thing did not belong to the legatee or devisee but later on he acquires it, then: a. If he acquired it by gratuitous title, then the legacy or devise is void. Reason: The purpose of the testator that the property would go to the devisee or legatee has already been accomplished with no expense to the legatee or devisee. b. If he acquired it by onerous title, the legacy or devise is valid and the estate may be required to reimburse the amount. Q: Suppose the property bequeathed or devised has been pledged or mortgaged, who has the obligation to free the property from such encumbrance? A: As a general rule, the pledge or mortgage must be paid by the estate, except if the testator provides otherwise. However, any other charge such as easements and usufruct, with which the thing bequeathed is burdened, shall be respected by the legatee or devisee. Rules on Legacy of Credit and Legacy of Remission

Q: Is a legacy or devise considered payment of a debt, if the testator has a standing indebtedness to the legatee or devisee? A: No, legacy or devise is not considered payment of a debt because if it is, then it would be a useless legacy or devise since it will really be paid. Q: What is the order of payment of legacies and devises? A: 1. Remuneratory legacies or devises 2. Legacies or devises declared by testator to be preferential 3. Legacies for support 4. Legacies for education 5. Legacies or devises of a specific determinate thing which forms part of the estate 6. All others pro rata Q: What are the grounds for the revocation of legacy or devise? A: 1. Transformation of the thing in such a manner that it does not retain either the form or the denomination it had. 2. Alienation of the thing bequeathed.  In general, the alienation of the property revokes the legacy or devise notwithstanding the nullity of the transaction.  However, whether or not the legacy or devise is revoked or not depends on the basis for the nullity of the contract: 1. If the nullity is based on vitiated consent, the legacy or devise is not revoked because there was no intention to revoke. 2. For all other grounds, the legacy or devise is revoked.  Exception: If the sale is pacto de retro and the testator reacquired it during his lifetime. 3.

Total lost of the thing bequeathed.

 The lost of the thing bequeathed must not be attributed to the heirs. There should be no fault on the part of the heirs.

Q: What is a legacy of credit? A: Legacy of credit takes place when the testator bequeaths to another a credit against a third person. In effect, it is a novation of the credit by the subrogation of the legatee in the place of the original creditor.

Capacity to succeed is the ability to inherit and retain property obtained mortis causa

Q: What is a legacy of remission? A: A legacy of remission is a testamentary disposition of a debt in favor of the debtor. The legacy is valid only to the extent of the amount of the credit existing at the time of the testator's death. In effect, the debt is extinguished.

Requisites: 1. The heir, legatee or devisee must be living or in existence AT TIME succession opens; 2. Such heir, legatee or devisee must not be incapacitated or disqualified by law to succeed.

Rules: 1. Legacy applies only to the amounts outstanding at the time of the testator's death. 2. The legacy is revoked if the testator files an action (judicial suit) against the debtor. 3. It applies only to credits existing at the time the will was made, and not to subsequent credits.

General rule: A thing or entity which is neither a natural nor juridical person cannot inherit by will Exceptions: 1. organizations/associations for religious, scientific, cultural, educational or charitable purposes 2. the poor in general

CAPACITY TO SUCCEED

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43 CIVIL LAW NOTES

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INCAPACITY TO SUCCEED:

3.

Article1027. The following are incapable of succeeding: 1. The priest who heard the confession of the testator during his last illness, or the minister of the gospel who extended spiritual aid to him during the same period; 2. The relatives of such priest or minister of the gospel within the fourth degree, the church, order, chapter, community, organization, or institution to which such priest or minister may belong; 3. A guardian with respect to testamentary dispositions given by a ward in his favor before the final accounts of the guardianship have been approved, even if the testator should die after the approval thereof; nevertheless, any provision made by the ward in favor of the guardian when the latter is his ascendants, descendant, brother, sister, or spouse, shall be valid; 4. Any attesting witness to the execution of a will, the spouse, parents, or children, or any one claiming under such witness, spouse, parents, or children; 5. Any physician, surgeon, nurse, health officer or druggist who took care of the testator during his last illness; 6. Individuals, associations and corporations not permitted by law to inherit.

4.

N.B. Numbers 1 to 5 do not apply to legitimes. Person Disqualified: Priest

 A priest is incapacitated to succeed when the confession is made prior to the making of a will.  If simultaneous, the priest is still disqualified.  If the will is made way before such confession, the priest can inherit.  The disqualification applies only to testamentary dispositions. Q: If the confession was made before the will was made and the priest is the son of the sick person, can the priest inherit upon the death of the sick person? A: Yes. He can get the legitime. Q: If the priest were a brother, same circumstances as above, can he inherit? A: Yes. He can inherit by intestacy. Person Disqualified: Priest or minister  Despite this apparent restriction to Christian ministers, this applies to all spiritual ministers, e.g., Buddhist monks.  Reason: It is conclusively presumed that the spiritual minister used his moral influence to induce or influence the sick person to make a testamentary disposition in his favor.  Requisites: 1. The will was made during the last illness 2. The spiritual ministration must have been extended during the last illness

The will was executed during or after the spiritual ministration. Relatives of the priest of minister of the gospel

Person Disqualified: Guardian

 General rule: The disqualification applies when the disposition is made after the guardianship began or before guardianship is terminated (approval of final accounts or lifting of guardianship.)  Exception: The disposition is valid when the guardian is an ascendant, descendant, brother, sister or spouse. Person Disqualified: Attesting witness.

 General rule: The witness, the spouse, parent, and the child of the witness are disqualified to inherit.  Exception: If there are three (3) other witnesses to the will. Person Disqualified: Physician, surgeon, nurse, health officer or druggist.  The persons mentioned must have taken care of the sick person.  Requisites: 1. The will was made during the last illness 2. The sick person must have been taken cared of during his last illness. Medical attendance was made. 3. The will was executed during or after he was being taken cared of. OTHER PROHIBITED DISPOSITIONS IN TESTAMENTARY SUCCESSION Art. 1028. The prohibitions mentioned in article 739, concerning donations inter vivos shall apply to testamentary provisions. (Art. 739 has been rephrased as follows:) Article 739. The following dispositions shall be void: 1. Those made between persons who were guilty of adultery or concubinage at the time of the making of the will; 2. Those made between persons found guilty of the same criminal offense, in consideration thereof; 3. Those made to a public officer or his wife, descendants and ascendants, by reason of his office. UNWORTHINESS Article1032. The following are incapable of succeeding by reason of unworthiness: 1. Parents who have abandoned their children or induced their daughters to lead a corrupt or immoral life, or attempted against their virtues; 2. Any person who has been convicted of an attempt against the life of the testator, his or her spouse, descendants or ascendants;

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

44 2007 Team Bar-Ops Civil Law Committee

3. Any person who has accused the testator of a crime for which the law prescribes imprisonment for six years or more, if the accusation has been found to be groundless; 4. Any heir of full age who, having knowledge of the violent death of the testator, should fail to report it to an officer of the law within a month, unless the authorities have already taken action; this prohibition shall not apply to cases wherein, according to law, there is no obligation to make an accusation; 5. Any person convicted of adultery or concubinage with the spouse of the testator; 6. Any person who by fraud, violence, intimidation, or undue influence should cause the testator to make a will or to change one already made; 7. Any person who by the same means prevents another from making a will, or from revoking one already made, or who supplants, conceals, or alters the latter's will; 8. Any person who falsifies or forges a supposed will of the decedent.

  1. 2. 3. 4. 5. 6.

N.B. Grounds 1, 2, 3, 5 and 6 are the same grounds as in disinheritance. Numbers 6, 7 and 8 cover six (6) acts which relate to wills: Causing the testator to make a will Causing the testator to change an existing will Preventing the decedent from making a will Preventing the testator from revoking his will Supplanting, concealing, or altering the testator's will. Falsifying or forging a supposed will of the decedent.

FORMULA FOR APPLICATION OF INHERITANCE: (ISRAI) (The following are applied successively) 1. I – institution of an heir (bequest in case of legacies or devises) 2. S – substitution if proper 3. R – representation if applicable 4. A – accretion if applicable 5. I – intestacy if all of the above are not applicable LEGAL OR INTESTATE SUCCESSION Q: When can legal or intestate succession take place? A: Intestate succession takes place when: 1. there is no will; the will is void, or the will is revoked; 2. the will does not dispose all the property of the testator. (partial intestacy); 3. the suspensive condition attached to the inheritance is not fulfilled; 4. the heir predeceased the testator or repudiates the inheritance and no substitution and no right of accretion take place.

5. the heir instituted is incapacitated to succeed, except in cases provided for under the NCC. N.B. The enumeration is not exclusive; there are other still causes for intestacy which are not included in the enumeration. Examples: 1. preterition; 2. arrival of the resolutory term or period; 3. fulfillment of a resolutory condition attached to the inheritance. Q: Can there be a valid will which does not institute an heir? A: Yes, a will is valid even if it contains only a provision for disinheritance or if only legacies and devises are contained in the will. Q: Who are intestate heirs?

A: 1. Legitimate children or descendants 2. Illegitimate children or descendants 3. Legitimate parents or ascendants 4. Illegitimate parents 5. Surviving spouse 6. Brothers and sisters, nephews and nieces 7. Other collateral relatives up to the 5th degree 8. The State. Q: What is the order of preference between lines in legal or intestate succession? A: Succession takes place: First, in the direct descending line, Second, in the direct ascending line, Finally, in the collateral line Q: What are the distinctions between intestate succession from compulsory succession? A: Intestate Succession Compulsory Succession (Legitime) Merely provides for the presumed will of the deceased. Suppletory to testate succession and takes place only in default of the latter.

Rules are obligatory on the testator regardless of his wishes. Takes place whether the deceased has left a will or not and is therefore superior and independent of testamentary succession.

PRINCIPLES IN INTESTATE SUCCESSION Preference of Lines– Relatives of decedent who are in direct descending line shall EXCLUDE those in the direct ascending or in the collateral line, while those in direct ascending line exclude those in collateral line Proximity – Relatives of decedent nearest in degree EXCLUDE the more remote ones; presupposes the fact that all of relatives involved should belong to the same line; still subject to preferences between lines, except when right of representation takes place Right of Representation (RR) – Right created by fiction of law where the representative is raised to

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45 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

the place and degree of the person represented, and acquires the rights which the latter would have if he were living or could have inherited.

 Rationale: The law presumes the existence of antagonism between the illegitimate child and the legitimate relatives of his parents.

 Representation takes place in the direct

ACCRETION





 1. 2. 3.

descending line, but never in the ascending. In the collateral line - RR takes place only in favor of children of brothers or sisters, whether full or half blood and only if they concur with at least one uncle or aunt. An illegitimate child can represent his father, provided that the father was also illegitimate. Representation may arise either because of: death, incapacity, or disinheritance.

 One who repudiates cannot be represented.  The representative himself must be capable of succeeding the decedent.  In representation, the representative does not inherit from the person represented but from the testator or decedent.  The right of representation cannot be invoked by adopted children because they cannot represent their adopting parents to the inheritance of the latter’s parents.  Reason: The law does not create any relationship between the adopted child and the relatives of the adopting parents, not even to the biological/legitimate children of the adopting parents.  Under RA 8552 or the Domestic Adoption Law, the adopted child and the adopting parents have reciprocal successional rights.  Voluntary heirs, legatees and devisees who predeceased the testator or renounced the inheritance cannot be represented by their own heirs, with respect to their supposed inheritance.  Representation is superior to accretion. OTHER RULES GOVERNING INTESTATE SUCCESSION:  The share of an illegitimate child is ½ of the share of a legitimate one.  Full blood brother or sister is entitled to double the share of half brother or sister (Art. 1006).  Compulsory heirs shall, in no case, inherit ab intesto less than their legitime as provided in testamentary succession. Q: What is the iron- curtain rule? A: Art. 992 provides that illegitimate children cannot inherit ab intestato from the legitimate children and relatives of his mother or father. Legitimate children and relatives cannot inherit in the same way from the illegitimate child.  The iron curtain rule only applies in intestate succession.  There is barrier recognized by law between the legitimate relatives and the illegitimate child so that one cannot inherit from the other and vice versa.

Q: What is accretion? A: Accretion is a right by virtue of which, when two or more persons are called to the same inheritance, devise or legacy, the part assigned to the one who renounces or cannot receive his share, or who died before the testator, is added or incorporated to that of his co-heir, co-devisees, or co-legatees. Basis: Accretion is a right based on the presumed will of the deceased that he prefers to give certain properties to certain individuals rather than to his legal heirs. Accretion is preferred over intestacy. Q: In testamentary succession, in what instances may accretion take place?

A: 1. Predecease 2. Incapacity 3. Renunciation 4. Non-fulfillment of suspensive condition imposed upon instituted heir 5. Ineffective testamentary disposition Q: In intestate succession, in what instances may accretion take place? A: 1. Predecease of legal heir 2. Incapacity of legal heir 3. Repudiation by legal heir  Accretion takes place only if there is no representation.  In renunciation, there is always accretion. Reason: There is no representation in renunciation.  In intestacy, apply representation first. If there is none, then accretion will apply.  In testamentary succession, apply substitution first. If there is no substitution, then accretion will apply.  However, in testamentary succession, the inheritance must not have been earmarked. Accretion cannot take place if the inheritance is earmarked. ACCEPTANCE AND REPUDIATION Acceptance and Repudiation – Acts which are purely free and voluntary; retroacts to moment of death of decedent Inheritance deemed accepted when heir: 1. Sells, donates, assigns his right to stranger, or his co-heirs or any of them 2. Renounces same, even though gratuitously, for benefit of one or more of his co-heirs 3. Renounces it for price in favor of all his coheirs indiscriminately Requisites of Valid Waiver of Inheritance: 1. existence of right;

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

46 2007 Team Bar-Ops Civil Law Committee

2. knowledge of such existence; 3. intention to relinquish such right

State

COLLATION Collation- the process of adding the value of thing donated to the net value of hereditary estate. Collation is applicable to both donations to compulsory heirs and donations to strangers General rule: Compulsory heirs are obliged to collate. Exceptions: 1. when testator should have so expressly provided; 2. when compulsory heir repudiates his inheritance What to Collate: 1. Any property/right received by gratuitous title DURING testator’s lifetime 2. All that may have been received from decedent during his lifetime 3. All that their parents have brought to collation if alive PARTITION

Partition and Distribution-separation, division and assignment of thing held in common among those to whom it may belong Q: Who can demand partition? A: 1. any compulsory heir 2. any voluntary heir 3. any legatee or devisee 4. any person who has acquired an interest in the estate Q: When partition CANNOT be demanded? A: Partition cannot be demanded when: 1. Expressly prohibited by testator for a period not more than 20 years 2. Co-heirs agreed that estate not be divided for period not more than 10 years, renewable for another 10 yrs 3. Prohibited by law 4. When to partition estate would render it unserviceable for use for which it was intended

Concurrence Theory – satisfy legitime and then distribute disposable portion, if any pro rata Exclusion Theory – satisfy legitime and then give disposable portion, if any to the preferred heir in the order of intestate succession TABLE OF LEGITIMES (Based on possibility of concurrence) Legend: Legitimate Children or Descendants LCD Illegitimate Children or Descendants ILCD Legitimate Parents or Ascendants LPA Illegitimate Parents or Ascendants ILPA Surviving Spouse SS Concurring Compulsory Heirs ILCD SS

Legitimate Child

⅓

General Rule: SS alone Marriage in articulo mortis, testator died w/in 3 months

⅓

⅔

½

½

½ ½ ¼ ½

½ ¼

ILCD SS LPA ILC LPA LPA SS ILPA SS ILCD SS ILC alone LPA alone ILPA alone

Marriage in articulo mortis, testator died w/in 3 months but have been living as husband and wife for not less than 5 years

One LCD SS

Illegitimate Child

Free Portion

⅓ ⅓ ¼ ⅛ ½ ¼ ½ ½ ¼ ¼ ¼ ¼ ¼ ½ ½ ½ ½

LCD alone

Order of Intestate Succession

Legitime

⅛ ¼ ¼ ½ ½ ½ ½ ½ ½

Legitimate Child and Legitimate Descendants

Legitimate Child and Legitimate Descendants

Two or more LCD SS

Legitimate Parents and Legitimate Ascendants

Illegitimate Children and Legitimate or Illegitimate Descendants

LCD ILCD

Illegitimate Children and Legitimate or Illegitimate Descendants Surviving Spouse

Illegitimate Parents

Legitimate Siblings, Nephews, Nieces

Illegitimate Siblings, Nephews, Nieces

Legitimate Collateral Relatives

State

TABLE OF INTESTATE SHARES (Based on possibility of concurrence) Legend: Legitimate Children or Descendants LCD Illegitimate Children or Descendants ILCD Legitimate Parents or Ascendants LPA Illegitimate Parents or Ascendants ILPA Surviving Spouse SS Brothers and Sisters BS Nephews and Nieces NN

Surviving Spouse

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(Same as one LCD)

½ ½of LCD

Dependent on number of LCD Dependent on ILCD

47 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

INTESTATE HEIRS

LEGITIME

SHARE IN PORTION

LCD alone

½ ½ ¼ ½

½

SS

same share as the LCD

LCD

½

Legitimes to be divided equally between total number of children plus the SS Remaining portion of estate after paying legitimes

ILCD

½ share of

LCD alone SS LCD

THE

FREE

¼ Remaining portion of after paying legitimes

the one LCD

estate

Legitimes to be divided by the ratio of 2: 1

One LCD

½

Remaining portion of estate after paying legitimes to be divided by the ratio of 2:1

One ILCD

½ share of

One part goes to the ILCD

one LCD

SS LCD

¼ ½

ILCD

½ share of

Same share as a legitimate child Remaining portion of estate after paying legitimes to be divided by the ratio of 2:1

one LCD

SS LPA alone LPA ILCD LPA SS LPA SS ILCD ILCD alone ILCD SS SS ILPA alone ILPA SS BS, NN SS NN

One part goes to the ILCD

¼

Same share as a legitimate child, provided legitimes are not impaired

½ ½ ¼ ½ ¼ ½

½

⅛

⅛

demand satisfaction from the assets of the latter”. (Arias Ramos) CIVIL OBLIGATION

NATURAL OBLIGATION

binding force is from positive law can be enforced by court action

binding force is from equity and justice Cannot be enforced in court. It depends exclusively upon the good conscience of the debtor.

Q: What are the elements of an obligation? A: J.A.P.O.C. 1. Juridical/legal tie 2. Active subject (obligee/creditor) 3. Passive subject ( obligor/debtor ) 4. Object – prestation; the conduct which has to be observed by the debtor/obligor 5. Cause Q: What is prestation? A: It is the observance of a determinate conduct required for the performance of the obligation. Q: What are the requisites of an object? A: a. licit b. possible c. determinate or determinable d. pecuniary value Q: What are the accessory obligations? A: Exercise diligence Preserve the thing

/

¼ ¼

¼ ½ ⅓ ⅓ ½ or ⅓ ½ ¼ ¼ ½ ½

Delivery of fruits

*when there is a term/condition – from the moment the term or condition arises

½ 1/6 1/6

½ or ⅓ ½ ¼ ¼ ½ ½

BOOK FOUR OBLIGATIONS AND CONTRACTS OBLIGATIONS Q: What is obligation? A: “It is a juridical relation whereby a person (creditor) may demand from another (debtor) the observance of a determinative conduct (the giving, doing, or not doing), and in case of breach, may

Standard of care: that of a good father of a family – unless the law or stipulation requires higher standard of care. Q: When does the right begin to exist? A: From the time to deliver arises. *when there is no term/condition – from the perfection of the contract

Delivery of accessories & accessions

Req’d in an obligation to deliver determinate thing

Q: Differentiate accessories from accessions. A: a. Accessories - those joined to or included with the principal for the latter’s better use, perfection or enjoyment. b. Accessions – additions to or improvements upon a thing. Q: What are the five SOURCES OF OBLIGATIONS? (LCQ-DQ) A: (Art. 1157) 1. Law 2. Contracts Note: Contractual Obligation – it presupposes that the contracts entered into are valid and enforceable. 3. Quasi-contracts 4. Delicts

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

48 2007 Team Bar-Ops Civil Law Committee

GR: if one commits a crime, he is liable both criminally and civilly. XPN: No private offended party (ex. contempt) 5. Quasi-delict NOTE: • The enumeration is exclusive. • Obligations arising from law does not need the consent of the obligor • In order that the law may be a source of obligation, it should be the creator of the obligation itself. • Obligations arising from contracts need the consent of the contracting parties. Q: What is quasi-contract? A: A juridical relation arising from lawful, voluntary and unilateral acts based on the principle that no one should unjustly enrich himself at the expense of another. Q: What are the principal forms of Quasi-Contract? A: 1. NegotioriumGestio(Inofficious manager) – arises when somebody takes charge of the management of the business or property of another without any power from the latter. 2.

Solutio Indebiti (Unjust enrichment) – takes place when somebody received something from another without any right to demand for it, and the thing was unduly delivered to him through mistake.

Q: What are the rights of the creditor? (Arts. 11641166) A: Specific Obligation Generic Obligations Specific performance specific performance Damages, exclusive or in ask that the obligation be addition to specific complied with at the performance debtor’s expense Right to demand damages preservation of the thing, its accessions, accessories, and the fruits. right to the fruits and interests from the time the obligation to deliver arises

Q: What are the obligations of the debtor? A: Determinate Generic Deliver the thing agreed upon take care of the thing with the proper diligence of a good father of a family deliver all accessions, accessories and fruits of the thing pay damages in case of breach of obligation by reason of delay, fraud, negligence, contravention of the tenor thereof

deliver the thing which is neither of superior nor inferior quality damages in case of breach of obligation by reason of delay, fraud, negligence or contravention of the tenor thereof if the object is generic but the source is specified/delimited= to preserve the source

Q: What are the forms of breach of obligations? (Art. 1170) A: Voluntary-DR is liable for Involuntary- DR is unable damages if he is guilty of : to perform the obligation a. default( mora) due to fortuitous event thus b.fraud (dolo) not liable for damages c.negligence (culpa) d.contravention of the tenor thereof

Q: What is the concept of a good father of the family? A: In Picart v. Smith (37 Phil. 809), the Supreme Court described a good father of a family by first stating who is not. He is not and is not supposed to be omniscient of the future; rather, he is one who takes precautions against any harm when there is something before him to suggest or warn him of the danger or to foresee it. Q: What are the effects of breach of obligation? A: (Arts. 1167-1168) Q: What is default or delay? A: (Art. 1169) Q: What are the classes of default? A: 1. Mora solvendi – default on the part of the debtor/obligor 2. Mora accipiendi – default on the part of the creditor/obligee 3. Compensatio morae – default on the part of both the debtor and creditor in reciprocal obligations Q: What are the requisites of mora solvendi? A: 1. Obligation pertains to the debtor; 2. Obligation is determinate, due and demandable; 3. Obligation has not been performed on its maturity date; 4. There is judicial or extrajudicial demand by the creditor. NOTE: Mora Solvendi does not apply to natural obligations (Article 1423) and negative obligations. Q: What are the requisites of mora accipiendi? A: 1. Refusal of the creditor 2. Offer of performance by a capacitated debtor 3. Offer must be to comply prestation as it should be performed. Q: What is the effect of mora solvendi? A: DR is liable for damages, his liability subsists even if the object of the obligation may have been lost or destroyed through a fortuitous event. Q: What is fraud? A: It is an intentional evasion of the faithful performance of the obligation. Note: Fraud must be present during the performance of the obligation, not at the time of the birth of the obligation (causal or incidental fraud) Q: What is negligence or fault? A: (Art. 1173) Q: What is the degree of diligence required? A: 1. that agreed upon

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2. in the absence of such, that which is required by the law 3. in the absence of the foregoing, diligence of a good father of a family Q: What is fortuitous event? A: (Art. 1174) Q: What are the requisites of a fortuitous event? A: 1. cause is independent of the will of the debtor 2. the event is UNFORSEEABLE/UNAVOIDABLE 3. occurrence renders it impossible for the DR to fulfill his obligation in a normal manner 4. DR is free from any participation in the aggravation of the injury to the CR. GR: No liability for loss in case of fortuitous event. XPNS: LaNS- PC,Bag 1. Law 2. Nature of the obligation requires the assumption of risk 3. Stipulation 4. the debtor has promised the same thing to two or more persons who does not have the same interest 5. the debtor contributed to the loss (Tan Chiong Sian v. Inchausti & Co.) 6. the possessor is in bad faith (Art. 552) 7. the obligor is guilty o fraud, negligence or delay or if he contravened the tenor of the obligation ( Juan Nakpil v. United Construction Co., Inc. v. CA ) Q: What are the effects of fortuitous event? A: On determinate obligation – obligation extinguished On generic obligation –obligation not extinguished (genus never perish) Q: What are the 3 remedies in connection w/ specific performance? A: 1. exhaustion of the properties of the debtor 2. accion subrogatoria (subrogatory action) – an indirect action brought in the name of the debtor by the creditor to enforce the former’s rights except: a. personal rights of the debtor b. rights inherent in the person of the debtor 3. accion pauliana (rescissory action) – an action to impugn or assail the acts done or contracts entered into by the debtor in fraud of his creditor * The remedies must be in the above order. NOTE: GR: All rights acquired are transmissible. EXCEPT: Those not transmissible by La.N.S. 1. Law 2. Nature eg. purely personal rights 3. Stipulation of parties Q: What is a pure obligation? A: (Art. 1179) Q: What is a conditional obligation?

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

A: An obligation subject to a condition and the effectivity of which is subordinated to the fulfillment or non-fulfillment of a future and uncertain event. Note: Condition – is a future and uncertain event, the happening of which, the effectivity or extinguishment of an obligation (or right) subject to it depends. Basis 1. As to time

Period Condition Refers to the May refer to past future event unknown to the parties 2.As to fulfillment It will happen at May or may not an exact date or happen at an indefinite time, but is sure to arrive. 3.As to its No effect or May give rise to influence on the influence upon an obligation obligation to be the existence of (suspensive) or fulfilled or the obligation the cessation of performed but only in its one already demandability or existing performance (resolutory)

SUSPENSIVE and RESOLUTORY CONDITION Suspensive condition 1. if fulfilled, obligation arises or becomes effective 2.if not fulfilled, no juridical relation is created 3.righjts are not yet acquired, but there is hope or expectancy that they will soon be acquired

Resolutory condition 1.if fulfilled, obligation is extinguished 2.if not fulfilled, juridical relation is consolidated 3.rights are already acquired, but subject to the threat or danger of extinction

Q: What is the meaning of constructive fulfillment of condition? A: It means that the condition shall be deemed fulfilled when the debtor actually prevents the fulfillment of the condition. Q: What are the effects of Potestative Condition? A: 1. If the fulfillment depends exclusively upon the will of the debtor, both the condition and the obligation are VOID. Note: If the obligation is a pre-existing one, only the condition is VOID, leaving unaffected the obligation itself. 2. If the fulfillment depends upon the will of the creditor, the condition and obligation are VALID. Q: What are the types of condition? A: • Casual – the performance or fulfillment of the condition depends upon chance and/or the will of a third person • Mixed – the performance or fulfillment of the condition depends partly upon the will of a party to the obligation and partly upon chance and/or the will of a third person • Positive –involves the doing of an act • Negative –involves the omission of an act

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

50 2007 Team Bar-Ops Civil Law Committee

• Divisible –is susceptible of partial performance • Indivisible –is not susceptible of partial performance • Conjunctive – there are several conditions in an obligation all of which must be performed • Alternative – there are several conditions in an obligation but only one must be performed • Possible –is capable of fulfillment according to the nature, law, public policy or good customs. • Impossible –is not capable of fulfillment according to nature, law, public policy or good customs (Art. 1183) GR: (Impossible Conditions) Annul the obligation which depends upon them. XPNS: P.D.Do.N.T. 1. Pre-existing obligation 2. Obligation is Divisible 3. in simple or remuneratory Donations 4. in case of conditions Not to do an impossible thing 5. in Testamentary dispositions * In the foregoing, the obligations remain valid, only the condition is void and deemed to have not been imposed Q: When will the effect of fulfillment of a condition retroact? A: 1. In an obligation to give: retroacts to the day of the constitution of the obligation 2. In an obligation to do or not to do: the courts shall determine whether or not there will be a retroactive effect or when retroactivity will take effect Q: What are the effects of loss, deterioration and improvement in real obligations? (During the pendency of the condition and the Suspensive condition has been fulfilled) (Art. 1189) Loss Deterioration

Improvement

W/ DR’S fault W/O DR’s fault DR pays Obligation damages extinguished CRchoose Impairment b/w rescission borne by CR of obligation or fulfillment (w/ indemnity for damages in either case) a. by the thing’s nature or by time – inure to the benefit of the CR b. at the debtor’s expense-DR shall have no right other than that granted to a usufractuary

Q: What are reciprocal obligations? A: (Art. 1191) Q: What are the characteristics of right to rescind? A: 1. can be demanded only if plaintiff is ready, willing and able to comply with his own obligation and defendant is not 2. not absolute 3. Needs judicial approval in certain cases

4. subject to judicial review if availed of extra judicially 5. may be waived expressly or impliedly 6. Implied to exist in reciprocal obligations therefore need not be expressly stipulated upon Note: (Resolution under Art. 1191, not Rescission under Arts. 1380-1381) GR: The right to rescind must be availed of judicially. XPN: if there is an express stipulation of automatic rescission Extrajudicial Rescission: When automatic rescission is expressly stipulated, a written notice sent to the other party is still necessary. The extrajudicial rescission has legal effect where such party does not oppose it. Where it is objected to, a determination of the issues by the court is still necessary. Q: What is an obligation with a period or a term? A: (Art. 1193) An obligation whose demandability or extinguishment is subject to the expiration of a period or a term. Note: GR: When a period has been agreed upon for the performance or fulfillment of an obligation, it is presumed to have been established for the benefit of both the creditor and the debtor XPN: When it appears from the tenor of the period or other circumstances that it was established for the benefit of one of the parties. Q: When may the court fix the period? A: (Art. 1197) Q: When may a debtor lose his right to make use of the period? A: (Art. 1198) FACULTATIVE and ALTERNATIVE OBLIGATION Facultative Obligations Alternative Obligations 1.fortuitous loss 1.fortuitous loss of all extinguishes the obligation prestation will extinguish the obligation 2.culpable loss obliges the 2. culpable loss of debtor to deliver substitute any object due will give prestation without liability rise to liability to debtor to debtor 3.choice pertains only to 3.choice may pertain to debtor debtor, creditor or third person 4.only one object is due 4.several objects are due 5.may be complied with by 5.may be complied with substitution of one that is by fulfilling any of those due alternately due 6.if principal obligation is 6.if one prestation is void, void, the creditor cannot the others free from vices compel delivery of the preserve the validity of substitute the obligation 7.if there is impossibility to 7. if various prestations deliver the principal thing are impossible to perform or prestation, the except one, this one must obligation is extinguished be delivered. If all prestations are impossible to perform, the obligation is extinguished

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Note: In alternative obligations, choice takes effect only upon communication of the choice to the other party and from such time the obligation ceases to be alternative (Art. 1205) *Debtor cannot choose prestations which are: 1. impossible 2. unlawful 3. could not have been the object of the obligation Q: What are joint and solidary obligations? A: (Art. 1207) Q: What is the effect of joint obligation? A: the entire obligation is to be paid or performed proportionately by the debtors. Q: What is the effect solidary obligation? A: Each one of the debtors is obliged to pay the entire obligation, and each one of the creditors has the right to demand from any of the debtors the payment or fulfillment of the entire obligation Q: Joey, Jovy and Jojo are solidary debtors under a loan obligation of P300,000.00 which has fallen due. The creditor has, however, condoned Jojo's entire share in the debt. Since Jovy has become insolvent, the creditor makes a demand on Joey to pay the debt. 1. How much, if any, may Joey be compelled to pay? 2. To what extent, if at all, can Jojo be compelled by Joey to contribute to such payment? A: 1. Joey can be compelled to pay only the remaining balance of P200,000, in view of the remission of Jojo s share by the creditor. (Art. 1219, Civil Code) 2. Jojo can be compelled by Joey to contribute P50,000. Art. 1217, par. 3, Civil Code provides, "When one of the solidary debtors cannot, because of his insolvency, reimburse his share to the debtor paying the obligation, such share shall be borne by all his co-debtors, in proportion to the debt of each." Since the insolvent debtor's share which Joey paid was Pl00,000, and there are only two remaining debtors - namely Joey and Jojo - these two shall share equally the burden of reimbursement. Jojo may thus be compelled by Joey to contribute P50,000.00. (Bar Question, 1998) Q: What are the kinds of solidary obligation? A: 1. Passive– solidarity on the part of the debtors 2. Active– solidarity on the part of the creditors 3. Mixed– solidarity on both sides Indivisibility Solidarity 1. refers to the prestation 1.refers to the vinculum or object of the contract existing between the subjects or parties 2.does not require plurality 2.requires the plurality of of subjects or parties parties or subjects 3.in case of breach, it is 3.in case of breach, the converted to one of liability of the solidary indemnity for damages debtors for damages and the indivisibility of the remains solidary obligation is terminated

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

DIVISIBLE AND INDIVISIBLE OBLIGATIONS Divisible Indivisible susceptibility of an - non-susceptibility to be obligation to be performed performed partially partially -partial performance is tantamount to nonperformance

Note: The obligation to deliver a divisible thing may be considered indivisible when: a. the law so provides b. stipulation of the parties Q: What is a joint indivisible obligation? A: It is an obligation in which the object is indivisible but the liabilities of the parties are joint. Note:*enforcement of the obligation must be carried out against all debtors * In case of breach, only the guilty debtor will be liable for damages Q: What are obligations w/ penal clause? A: (Art. 1226) Q: What is a Penalty Clause? A: It is an accessory obligation attached to the principal obligation to assure greater responsibility in case of breach. Note: GR: The penalty fixed by the parties is a compensation or substitute for damages in case of breach. XPNS: 1. stipulation to the contrary 2. Debtor is sued for refusal to pay the agreed penalty 3. Debtor is guilty of fraud Q: When may PENALTY be reduced (Judicial)? A: P.i.U. 1. Partial performance of the obligation 2. irregular performance of the obligation 3. penalty is unconscionable Q: What are the purposes of penal clause? 1. function coercitiva o de garantia-to insure the performance of the obligation 2. function liquidatoria-to liquidate the amount of damages to be awarded to the injured party in case of breach 3. function estrictamente penal-to punish the obligor in case of breach Q: What are the modes of extinguishment of an obligation? A: (Art. 1231) I. PAYMENT OR PERFORMANCE (Art. 1232) Payment may consist not only in the delivery of money but also the giving of a thing (other than money), the doing of an act, or not doing of an act. GR: Creditor is not bound to accept payment or performance by a third person. XPNS: 1. when made by a third person who has interest in the fulfillment of the obligation 2. contrary stipulation

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

52 2007 Team Bar-Ops Civil Law Committee

Q: What are the REQUISITES OF A VALID PAYMENT? A: C.C-P.A.D. 1. capacity of the payor 2. capacity of the payee 3. propriety of the time, place, manner of payment 4. acceptance by the creditor 5. delivery of the full amount or the full performance of the prestation Q: What are the characteristics of payment? A: (Integrity, Identity, Indivisibility) 1. integrity of payment Note: GR: performance should always be in full XPNS: a. substantial performance – b. intent to comply in good faith c. deviation must only be slight d. estoppel or waiver – CR accepts incomplete or irregular performance without protest or objection e. express stipulation f. debt is partly liquidated and partly unliquidated 2. identity Note: GR: thing paid must be the very thing due and cannot be another thing even if of same quality and value XPN: Dation in payment 3. indivisibility GR: debtor cannot be compelled by the creditor to perform obligation in parts and neither can the debtor compel the creditor to accept obligation in parts

A: (Art. 1240) GR: Payment to an unauthorized person is not a valid payment. XPNs: 1. Payment to an incapacitated person if: a. he kept the thing delivered, or b. it has been beneficial to him 2. Payment to a 3rd person insofar as it redounded to the benefit of the CR 3. Payment in GF to the possessor of credit Q: What are the rules on monetary obligation? A: 1. payment in cash- must be made in the currency stipulated, if not possible, then in the legal tender in the Philippines 2. payment in check or other negotiable instrument- not considered payment, they are not considered legal tender and may be refused by the creditor except when: a. when the document has been cashed b. when it had been impaired through the fault of the creditor Q: What are the special forms of payment? A: 1. APPLICATION OF PAYMENT - the designation of the debt to which the payment must be applied when the DR has several obligations of the same kind in favor of the same CR NOTE: the choice is given to the debtor BUT may be transferred to the CR as when the DR makes payment and does not make application and DR accepts a receipt in which the application is made Requisites: 1. one debtor and one creditor 2. two or more debts of the same kind 3. amount paid by the debtor must not be sufficient to cover all debts

XPNS: a. when partial performance has been agreed upon b. when part of the obligation is liquidated and part is unliquidated c. when to require the debtor to perform in full is impractical Q: Who may pay the obligation? A: (Art. 1236) Q: What are the rights of 3rd person who paid the debt? A: (Art. 1237) 1. WITH knowledge and consent of the debtor: a. can recover entire amount paid (absolute reimbursement ) b. can be subrogated to all rights of the creditor 2. WITHOUT knowledge or against the will of the debtor – can recover only insofar as payment has been beneficial to the debtor ( right of conditional reimbursement ) Q: To whom payment should be made?

~ LEGAL APPLICATION OF PAYMENT application by law when neither the debtor nor the creditor made the application. -the payment is applied to the most burdensome obligation of the debtor. • The More Burdensome Rule is allowed only in legal application and neither the DR nor the CR can invoke it. • If the debts happen to be of same nature and burden, the payment shall be applied proportionately. 2. DATION IN PAYMENT (DACION EN PAGO) – property alienated by DR to CR in satisfaction of the debt in money; transmission of ownership of a thing by DR to CR as an accepted equivalent of the performance of the obligation - Consent of the CR is essential. 3. PAYMENT IN CESSION – DR abandons all of his property for the benefit of his CRs in order that from the proceeds thereof, the latter may obtain payment of credits - presupposes insolvency of the DR - all the DR’s CRs must be involved and the consent of all CRs must be obtained

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Dation in payment (Art. 1245) 1.one creditor 2.not necessarily in state of financial difficulty 3.thing delivered is considered as equivalent of performance 4.payment extinguishes obligation to the extent of the value of the thing delivered as agreed upon, proved or implied from the conduct of the creditor 5.ownership is transferred to CR upon delivery 6.an act of novation

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Payment in cession (Art. 1255) 1.plurality of creditors 2.debtor must be partially or relatively insolvent 3.universality or property of debtor is what is ceded 4.merely releases debtor for net proceeds of things ceded or assigned, unless there is contrary intention 5.ownership is not transferred 6.not an act of novation

4. TENDER OF PAYMENT AND CONSIGNATION (Arts. 1256-1261) TENDER OF PAYMENT- voluntary act of the DR whereby he offers to the CR the immediate performance of the former’s obligation Q: What is CONSIGNATION?

A: It is an act of depositing the object of the obligation in a competent court after refusal or inability of the creditor to accept the tender of payment. Q: What are the requisites of consignation? A: (V.P-C.P.A’S) 1. Valid existing debt which is already due 2. Prior valid tender except when prior tender of payment is dispensable 3. CR unjustly refuses the tender of payment 4. Prior notice of consignation given to persons interested in the fulfillment of the obligation 5. Amount or thing is deposited at the disposal of judicial authority 6. Subsequent notice of the fact of consignation to persons interested in the fulfillment of the obligation GR: Consignation shall produce effects of payment only if there is a valid tender of payment. XPNS: (A.R.T- i.T) 1. CR is absent or unknown, doesn’t appear at place of payment 2. when w/out just cause CR refuses to give a receipt 3. when the title of the obligation has been lost 4. CR is incapacitated to receive payment at the time it is due 5. when two or more persons claim the right to collect II. LOSS OF THE THING DUE (Art. 1262-1269) Q: When is a thing considered lost? A: When: (d.o.p.e) 1. it disappears in such a way that its existence is unknown; 2. it goes out of commerce; 3. It perishes; 4. Its existence is known but it cannot be recovered.

Note: 1.

In Determinate Obligations to Give –

GR: The obligation is extinguished when the object of the obligation is lost. XPNS: a. Law b. Nature of the obligation requires the assumption of risk c. Stipulation d. Debtor contributed to the loss e. Loss the of the thing occurs after the DR incurred in delay f. when DR promised to deliver the same thing to 2 or more persons who do not have the same interest g. when the debt of a certain and determinate thing proceeds from a criminal offense 2.

In Generic Obligations to Give –

GR: obligation not extinguished because the genus of a thing never perish. XPN: a. In case of generic obligations whose object is a particular class or group with specific or determinate qualities (Limited Generic Obligations) b. In Obligations to Do: obligation extinguished when prestation becomes legally or physically impossible III. CONDONATION – the gratuitous abandonment by the CR of his right (Art. 1270-1274) Q: What are the requisites of condonation? A: (G.AIDE) 1. must be Gratuitous 2. Acceptance by the debtor 3. must not be Inofficious 4. Formalities provided by law on Donations must be complied with 5. an Existing demandable debt IV. When is there confusion or merger of rights? A: (Art. 1275-1277) NOTE: Art. 1277 – Confusion does not extinguish a JOINT OBLIGATION except as regards the share corresponding to the creditor or debtor in whom the two characters concur. Q: What are the requisites of confusion of rights? A: 1. merger in the same person of the characters of both a CR and d DR 2. must take place in the persons of a principal CR and a principal DR 3. merger is definite and complete V. COMPENSATION – extinguishment in the concurrent amount of the obligation of persons who are reciprocally DRs and CRs of each other. Compensation and Confusion Compensation(Arts 1278-

Confusion (Arts 1275-

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

54 2007 Team Bar-Ops Civil Law Committee

1279) 1277) 1. two persons who are 1. one person where mutual debtors and qualities of debtor and creditors of each other creditor are merged 2. at least two obligations

2. one obligation

Q: What are the kinds of compensation? A: 1. Legal compensation –by operation of law 2. Conventional – by agreement of the parties 3. Judicial –by judgment of the court when there is a counterclaim duly pleaded, and the compensation decreed Q: What are the debts not subject to compensation? A: 1. debts arising from contracts of deposit 2. debts arising from contracts of commodatum 3. claims for support due by gratuitous title 4. obligations arising from criminal offenses 5. certain obligations in favor of government VI. NOVATION Q: What are the requisites? A: (Art. 1292) 1. previous valid obligation 2. an agreement by the parties to extinguish or modify the old obligation and create a new one or a modified version 3. valid new obligation Q: What are the effects of novation? 1. extinguishment of principal extinguishes the accessory, except:

ALSO

DR even w/out the consent or even against the will of the old DR. 2. Delegacion – effected with the consent of the CR at the instance of the old DR with the concurrence of the new DR. Subrogation and Assignment of rights Conventional Subrogation 1. governed by Arts. 13001304 2.debtor’sconsent is required 3.extinguishes the obligation and gives rise to a new one 4.defects and vices in the old obligation are cured 5.takes effect upon moment of novation or subrogation

Q: What are the forms of substitution of DRs? 1. Expromission – effected with the consent of the CR at the instance of the new

1. governed by Arts. 1624-1627 2.debtor’s consent is not required 3.Does not modify or extinguish the obligation 4. not cured 5. as far as the debtor is concerned, takes effect upon notification

Note: GR: Subrogation cannot be presumed. XPNS: 1. CR pays another CR who is preferred, w/out DR’s knowledge 2. A 3rd person not interested in the obligation pays with the express or tacit approval of the DR 3. Even w/o DR’s knowledge, person interested in fulfillment of obligation pays w/o prejudice to effects of confusion as to latter’s share. Q: What are contracts? A: (Article 1305) Elements (COC)

• stipulation to contrary • stipulation pour autrui UNLESS beneficiary consents 2. IF the new obligation is VOID, the old obligation shall subsist since there is nothing to novate, except: • when the parties intended that the old obligation be extinguished in any event. 3. IF the new obligation is VOIDABLE; novation can take place, except: • when such new obligation is ANNULLED. 4. IF the old obligation has a condition: • if Resolutory & it occurred –old obligation already extinguished; no new obligation since nothing to novate • if suspensive & it never occurred –as if no obligation; nothing to novate 5. IF old obligation has condition, must be compatible with the new obligation; if new is w/o condition – deemed attached to new 6. IF new obligation has condition • if resolutory: valid • if suspensive & did not materialize: old obligation is enforced

Assignment of rights

1. Consent 2.Object or Subject Matter 3.Cause or Consideration

Characteristics (ROMA) 1.Relativity (1311) 2.Obligatoriness and consensuality(1315) 3. Mutuality(1308) 4..Autonomy(1306)

Note: GR: Contracts are perfected by mere consent; XPN: in case of REAL CONTRACTS, such as deposit, pledge and commodatum, which are not perfected until the delivery of the obligation. (Arts. 1315 and 1316 ) Q: What are the stages in the life of the contract? A: 1. preparation/generation 2. perfection/birth 3. consummation/death Q: What is relativity of contracts? A: (Art 1311) GR: A contract is binding not only between parties but extends to the heirs, successors in interest, and assignees of the parties, provided that the contract involves transmissible rights by their nature, or by stipulation or by provision of law XPNS:

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55 CIVIL LAW NOTES

1. STIPULATION POUR AUTRUI (stipulation in favor of a 3rd person) – benefits deliberately conferred by parties to a contract upon 3rd persons Requisites: a. the stipulation must be part, not whole of the contract b. contracting parties must have clearly & deliberately conferred a favor upon 3rd person c. 3rd person must have communicated his acceptance d. neither of the contracting parties bears the legal representation of the 3rd person 2. When a 3rd person induces a party to violate the contract Requisites: a. existence of a valid contract b. 3rd person has knowledge of such contract c. 3rd person interferes without justification 3. 3rd persons coming into possession of the object of the contract creating real rights 4. contracts entered into in fraud of CRs Q: What is the obligatory force of contracts? A: The parties are bound not only by what has been expressly provided for in the contract but also to the natural consequences that flow out of such agreement (Art 1315) Q: What is mutuality of contracts? A: Contract must be binding to both parties and its validity and effectivity can never be left to the will of one of the parties (Art 1308) Q: What is the principle of autonomy of contracts? A: The freedom of the parties to contract and includes the freedom to stipulate subject to one limitation (Art. 1306) Q: What are nominate contracts? A: These are contracts which have been given particular names or denominations by law Q: What are innominate contracts? A: These are contracts without particular names and not regulated by special provision of law (Art. 1307) Q: How are innominate contracts regulated? A: (Art. 1307) 1. by the stipulation of the parties 2. by the general principles of obligations and contracts 3. by the rules governing the most analogous nominate contracts 4. by the customs of the place. Q: What is consent? A: (Art 1319) Q: What are the elements of consent? A: (LM-CR) 1. Legal capacity of the contracting parties 2. Manifestation of the conformity of the contracting parties 3. Parties’ conformity to the object, cause, terms and condition of the contract must be

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

4.

intelligent, spontaneous and free from all vices of consent The conformity must be real

Note: OFFER – may be made orally or in writing unless the law prescribes a particular form ACCEPTANCE – no specified form but when the offeror specifies a form, such must be complied with • Acceptance by letter or telegram does not bind the offeror except from the time it came to his knowledge. • Offer or acceptance, or both, expressed in electronic form, is valid, unless otherwise agreed by the parties (electronic contracts). Q: Who are the persons incapacitated to give consent? A: (Art 1327) (D.I.M.) 1. Deaf-mutes who do not know how to read and write 2. Insane or demented persons, unless the contract was entered into during a lucid interval 3. Minors except: • • • •

Contracts for necessaries Contracts by guardians or legal representatives When there’s active misrepresentation on the part of the minor. Contracts of deposit with the Postal Savings Bank provided that the minor is over 7 years of age

Q: What are the vices of consent? A: 1. MISTAKE – must refer to the substance of the thing; substantial mistake and not merely an accidental mistake - refers to mistake of facts and not of law 2. INTIMIDATION – an internal moral force operating in the will and inducing performance of an act 3. VIOLENCE – an external physical force exerted upon a person to prevent him from doing something or to compel him to do an act. 4. UNDUE INFLUENCE – any means employed upon a party which, under the circumstances could not be resisted and has the effect of controlling his volition and inducing him to give his consent to the contract, which otherwise, he would not have entered into 5. FRAUD – use of insidious words or machinations in inducing another party to enter into the contract, which without them, he would not have agreed. Q: What is an object? A: It is the subject matter in the contract Q: What are the requisites? A: (Arts. 1347-1349) 1. determinate as to kind( even if not determinate, provided it is possible to determine the same without the need of a new contract) 2. existing or the potentiality to exist subsequent to the contract 3. must be licit

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

56 2007 Team Bar-Ops Civil Law Committee

4. within the commerce of man

B. Real contracts that require delivery for perfection

Q: What is a cause? A: It is the reason why a party entered into the contract Q: What are the two presumptions in contracts? A: 1. every contract is presumed to have a cause 2. the cause is valid Q: What are the kinds of cause? A: 1. cause of onerous contracts – the prestation or promise of a thing or service by the other 2. cause of renumeratory contracts- the service or benefit renumerated 3. cause of gratuitous contracts –the mere liberality of the donor or benefactor Note: Absence of cause Failure of cause Illegality of cause Falsity of cause

Lesion

EFFECTS on contracts Confers no right and produces no legal effect Does not render the contract void Contract is null and void Contract is void, unless the parties show that there is another cause which is true and lawful Does not invalidate the contract, unless (1)there is fraud, mistake, or undue influence (2)when the parties intended a donation or some other contract

Q: What are rules on the form of contracts? A: 1. Contracts shall be obligatory, in whatever form they may have been entered into, provided all essential requisites for their validity are present 2. Contracts must be in a certain form - when the law requires that a contract be in some form to be: a. valid b. enforceable or c. for the convenience of the parties 3. The parties may compel each other to reduce the verbal agreement into writing: A: Solemn contracts such as: Donations of real estate or of movables if the value exceeding P 5,000; Transfer of large cattle; Stipulation to pay interest in loans ; Sale of land through an agent (authority must be in writing); Partnership to which immovables are contributed; Stipulation limiting carrier’s liability to less than extra-ordinary diligence; Contracts of antichresis and Sale of vessels • In such cases, if contract is not in writing, it is VOID.

C. In contracts under the Statute of Frauds, where the party sued makes a timely objection to the absence of a written memorandum Q: What are the acts which must appear in a public document? A: (Art. 1358) Q: What is reformation of instruments? A: (Art. 1359) Q: What are the requisites in reformation of instruments? 1. meeting of the minds to the contract 2. true intention is not expressed in the instrument by reason of mistake, accident, relative simulation, fraud, or inequitable conduct (MARFI) 3. clear and convincing proof of MARFI THERE IS NO REFORMATION in: (Arts. 1366-1367) 1. Simple, unconditional donations inter vivos 2. Wills; 3. When the agreement is void 4. When an action to enforce the instrument is filed Q: What are the kinds of simulation of contract? A: 1. Absolute- no real transaction is intended Effect: it is an inexistent contract 2. Relative- the real transaction is hidden Effect: the apparent contract is void but the hidden contract is valid, if it is lawful and has the necessary requisites. As to 3rd persons without notice, the apparent contract is valid on the principle of estoppel TABLE OF DEFECTIVE CONTRACTS: Rescissible 1.defect is caused by injury/damage either to one of the parties or to a 3rd person

Voidable 1.defect is caused by vice of consent

Unenforceable Void 1.defect is 1.defect is caused by lack caused by of form, lack of authority or essential capacity of elements or both parties illegality

2.cured by prescription

2.cured by 2.not cured by 2.not cured prescription prescription by prescription

3.binding unless 3.binding 3.binding 3. not rescinded until annulled unless the binding defect is raised against enforcement

Basis

Rescissib Voidable le (1380- (13901389) 1402)

Unenforc Void eable (1408(14031423) 1408)

1.Origin of the defect

Economic Damage or lesion;

Entered w/out authority

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Incapacity of one of parties to

Absence of any of essential

57 CIVIL LAW NOTES

declaration by law

2.Damag One of es/prejudi parties or ce 3rd person 3.Legal Valid & Effect legally enforceable until judicially rescinded

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

give consent or vitiated consent

To other party not necessary Valid, binding, enforceable until judicially rescinded

or in excess thereof; noncomplianc e with Statute of Frauds; Incapacity of both parties to give consent Not necessary

requisites of a contract (consent, object, cause)

Rescission and Resolution Rescission Resolution(Art 1191 ) Not necessary

Inoperativ None e until ratified; not enforceabl e in court w/out proper ratification

4.Reme Rescission Annulment dy/actio or of contract n rescissory action

Just a Declarati personal on of defense nullity of contract

5.Nature Must be a of action direct action 6.Who Contracting can file party; XPN: the action CRs who are defrauded

Indirect Attacked attack directly or allowed indirectly Must be 3rd contracting persons party cannot unless interests are directly affected Yes No

Direct action needed Generally, contracting party; XPN: 3rd person prejudiced

7.Suscep tibilty of ratificatio n

Yes but not Yes of ratification proper

8.Suscep tibilty of prescripti on

Action for rescission prescribes after 4 years

Action for annulment prescribes after 4 years

Action for recovery, specific performan ce or damages prescribe (10 years if basis written contract, 6 years if unwritten)

5. transfer of all his property by a DR when he is financially embarrassed or insolvent 6. transfer is made between father and son, where there are present some or any of the above circumstances and 7. Failure of the vendee to take exclusive possession of the property.

Action for declaratio n of nullity or putting of defense of nullity does not prescribe

Q: What are the rescissible contracts? A: (Article 1381) Q: What are the badges of fraud? A: 1. consideration of the conveyance is inadequate or fictitious 2. transfer was made by a DR after a suit has been begun and while it is pending against him 3. sale upon credit by an insolvent DR 4. the presence of evidence of large indebtedness or complete insolvency of the debtor

1. action by the contracting parties even by a third party 2. based on lesion/ fraud of creditors 3. courts cannot grant periods for compliance

1. action only by the injured party 2. based on nonfulfillment of the obligation 3. courts may grant

Q: When is there a voidable contract? A: 1. When one of the parties is incapacitated to give consent 2. When consent was vitiated Q: What are the causes of extinction of action to annul? A: 1. Prescription - the action must be commenced within 4 years from: a. the time the incapacity ends b. the time the violence, intimidation or undue influence ends or c. the time the mistake or fraud is discovered 2. Ratification Requisites: a. there must be knowledge of the reason which renders the contract voidable b. such reason must have ceased and c. the injured party must have executed an act which expressly or impliedly conveys an intention to waive his right 3. By loss of the thing which is the object of the contract through fraud or fault of the person who is entitled to annul the contract Q: What is confirmation? A: Act by which a voidable contract is cured of its vice or defect. Q: What is recognition? A: Act whereby a defect of proof is cured such as when an oral contract is put into writing or when a private instrument is converted into a public instrument. Q: What is ratification? A: Act by which a contract entered into in behalf of another without or in excess of authority is cured of its defect. Q: What are the modes of ratification? A: 1. For contracts infringing the Statute of Frauds: a. expressly

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

58 2007 Team Bar-Ops Civil Law Committee

impliedly- by failure to object to the presentation of oral evidence to prove the contract, or by the acceptance of benefits under the contract. 2. If both parties are incapacitated, ratification by their parents or guardian shall validate the contract retroactively b.

Q: What are unenforceable contracts? A: (Article 1403)

5. 6. 7. 8.

*AGREEMENTS WITHIN THE SCOPE OF THE STATUTE OF FRAUDS: (Article 1403 par.2) Q: What are void contracts? A: (Article 1409)

prohibition is designed for the protection of the plaintiff payment of any amount in excess of the maximum price of any article fixed by law or regulation by competent authority contract whereby a laborer undertakes to work longer than the maximum number of hours fixed by law contract whereby a laborer accepts a wage lower than the minimum wage fixed by law one who lost in gambling because of fraudulent schemes practiced on him is allowed to recover his losses

CONTRACT and INEXISTENT CONTRACT Void Contract Inexistent Contract

Q: What are the kinds of void contracts? 1) Those lacking in essential elements: no consent, no object, no cause– essential formalities are not complied with ( ex: donation propter nuptias – should conform to formalities of a donation to be valid ) a. Those w/c are absolutely simulated or fictitious – no cause b. Those which cause or object did not exist at the time of the transaction – no cause/object c. Those whose object is outside the commerce of man – no object d. Those w/c contemplate an impossible service – no object e. Those w/c intention of parties relative to principal object of the contract cannot be ascertained 2) Contracts prohibited by law 3) Illegal/Illicit contracts Q: What are inexistent contracts? A: Those which are absolutely simulated or fictitious or those whose cause or object did not exist at the time of the transaction Q: What is the Doctrine Pari Delicto? A: both parties are guilty, no action against each other; those who come in equity must come with clean hands; applies only to illegal contracts & not to inexistent contracts; does not apply when a superior public policy intervenes IN PARI DELICTO – not only both are at fault but that they are equally at fault Note: GR: When a void contract is such because of illegality of the cause or the object and both parties are at fault, the law leaves them where they are and will not come to their aid. XPNS: 1. payment of usurious interest 2. payment of money or delivery of property for an illegal purpose where the party who paid or delivered repudiated the contract before the purpose has been accomplished or before any damage has been caused to a 3rd person 3. payment of money or delivery of property by a party incapable of giving consent 4. agreement or contract which is not illegal per se but is merely prohibited and the

- those where all the requisites of a contract are present, but the cause, object or purpose is CONTRARY TO LAW, MORALS, GOOD CUSTOMS, PUBLIC ORDER or PUBLIC POLICY or the contract itself is PROHIBITED or DECLARED PROHIBITED. - Principle of IN PARI DELICTO is applicable.

- those where one or some of the requisites which are essential for validity are ABSOLUTELY LACKING.

- Principle of IN PARI DELICTO is NOT applicable.

Q: What are the instances of natural obligations? A: (Art 1423) 1. Performance after the civil obligation has prescribed 2. Reimbursement of a 3rd person for a debt that has prescribed 3. Restitution by minor after annulment of contract 4. Delivery by minor of money or fungible thing in fulfillment of obligation 5. Performance after action to enforce civil obligation has failed 6. Payment by heir of debt exceeding value of property inherited and 7. Payment of legacy after will has been declared void Q: What is ESTOPPEL? A: It is a condition or state by virtue of which an admission or representation is rendered conclusive upon the person making it and cannot be denied or disproved as against the person relying thereon. Estoppel in Pais (by conduct) a. Estoppel by silence b. Estoppel by acceptance of benefits 2. Technical Estoppel a. Estoppel by deed b. Estoppel by record 3. Estoppel by judgment 4. Laches Laches and Prescription Laches Prescription (1106-1155) 1.

1. concerned with effect of 1. concerned with fact of delay delay 2. inequity of permitting the 2. question of matter of time claim to be enforced 3. not statutory 3. statutory 4. applies in equity not 4. applies at law based on a based on a fixed time fixed time

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59 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

5. not based on a fixed time 5. based on a fixed time

Q: What are the essential elements of laches? A: 1. conduct on the part of the defendant or one under whom he claims, giving rise to the situation complained of 2. delay in asserting the complainant’s right after obtaining knowledge of the conduct of defendant 3. lack of knowledge or notice on the defendant that the complainant would assert his right 4. injury or prejudice to the defendant in the event relief is accorded to the complainant

Q: What are the Rules to determine existence of partnership? A:

PARTNERSHIP Q: What are the requisites of a Partnership? A: I.C.J. 1. intention to create a partnership 2. common fund obtained from contributions 3. joint interest in the profits Contract of partnership: (B.O.N.C.C.P.P) 1. Bilateral – it is entered into by two or more persons and the rights and obligations arising therefrom are reciprocal; 2. Onerous – each of the parties aspires to procure for himself a benefit through the giving of something; 3. Nominate 4. Consensual – perfected by mere consent. 5. Commutative – the undertaking of each of the partners is considered as the equivalent of that of the others; 6. Principal 7. Preparatory Q: What are the formalities needed for its creation? a. personal property 1. < than P3,000.00 – may be oral 2. ≥ P 3,000.00 – must be • in a public instrument • registered in SEC (VALID even if not registered, merely for administration and licensing purposes –Paras) real property – must be • in a public instrument • with an attached inventory (VOID as b/w the parties if not complied w/ Art. 1773) To be effective against 3rd parties • partnership must be registered in the Registry of Property of the province where the real property contributed is located b.

c. limited partnership • must be registered as such in the SEC (Otherwise, it’s not valid as a limited partnership)

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

60 2007 Team Bar-Ops Civil Law Committee

Creation

Juridical personalit y

PARTNERSHIP Created by a contract, by mere agreement of the parties Has a juridical personality separate and distinct from that of each partner

Purpose

Realization of profits

Duration/ Term of existence

No limitation

Disposal/ Transferab ility of interest

Partner may not dispose of his individual interest unless agreed upon by all partners

Power to act with 3rd persons

Effect death

of

Dissolutio n

CO-OWNER SHIP Created by law

CORPORATION Created by law

2. Both can only act through agents 3.Both are composed of an aggregate of individuals (except corporation sole)

None

Common enjoyment of a thing or right 10 years maximum

Co-owner may freely do so

In absence of stipulation to contrary, a partner may bind partnership (each partner is agent of partnership) Death of partner results in dissolution of partnership

Co-owner cannot represent the coownership

May be dissolved at any time by the will of any or all of the partners

May be dissolved anytime by the will of any or all of the coowners

Death of coowner does not necessarily dissolve coownership

Has a juridical personalit y separate and distinct from that of each corporato rs Depends on AOI 50 years maximum , extendibl e to not more than 50 years in any one instance Stockhold er has a right to transfer shares without prior consent of other stockhold ers Manage ment is vested with the Board of Directors

Death of stockhold er does not dissolve corporati on Can only be dissolved with the consent of the state

Q: What are the similarities between a partnership and a corporation? A: Partnership

1. Both have juridical personality separate and distinct from that of the individuals composing it

Corporation

4.Both distribute profits to those who contribute capital to the business (except non-stock, non-profit corporation) 5.Both can only be organized when there is a law authorizing their organization 6. Both are taxable as a corporation Q: What are the effects of unlawful partnership? A: 1. The contract is void ab initio and the partnership never existed in the eyes of the law 2. The profits shall be confiscated in favor of the government 3. The instruments or tools and proceeds of the crime shall also be forfeited in favor of the government 4. The contributions of the partners shall not be confiscated unless they fall under no. 3 Q: What are the classifications of partnership? A: 1. as to object a. universal partnership of all present assets b. particular partnership 2. as to liability of partners a. general partnership b. limited partnership 3. as to duration a. partnership at will b. partnership with a fixed period 4. as to legality of existence a. de jure partnership b. de facto partnership 5. as to representation to others a. ordinary or real partnership b. ostensible or partnership by estoppel 6. as to publicity a. secret partnership b. notorious or open partnership 7. as to purpose a. commercial or trading b. professional or non-trading Q: What are the kinds of partners? A: 1. CAPITALIST - contributes money or property to the common fund. 2. INDUSTRIAL - contributes only his industry or personal service 3. GENERAL - one whose liability to 3rd persons extends to his separate property 4. LIMITED - one whose liability to 3rd persons is limited to his capital contribution 5. MANAGING - manages the affairs or business of the partnership

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61 CIVIL LAW NOTES

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

6. LIQUIDATING - takes charge of the winding up of partnership affairs upon dissolution 7. PARTNERS BY ESTOPPEL - is not really a partner but is liable as a partner for the protection of innocent 3rd persons 8. CONTINUING PARTNER - continues the business of a partnership after it has been dissolved by reason of the admission of a new partner, retirement, death or expulsion of one of the partners 9. SURVIVING PARTNER - remains after a partnership has been dissolved by death of any partner 10. SUBPARTNER - is not a member of the partnership who contracts with a partner with reference to the latter's share in the partnership 11. OSTENSIBLE - takes active part and known to the public as partner in the business 12. SECRET - takes active part in the business but is not known to be a partner by outside parties 13. SILENT - does not take any active part in the business although he may be known to be a partner 13. DORMANT - does not take active part in the business and is not known or held out as a partner UNIVERSAL PARTNERSHIP ALL PROFITS ALL PRESENT PROPERTY a.

b.

Only US UFR UCT of the prop ertie s of the part ners bec ome CO MM ON PR OP ERT Y

a. ALL PROPERTIES actually belonging to the partners are CONTRIBUTED – they become common property (owned by all the partners and the partnership)

ALL PR OFI TS acq uire d by the IND UST RY of the part ners bec ome CO MM ON PR OP ERT

b.

GR: Aside from the contributed properties, ONLY the PROFITS of said property become COMMON PROPERTY XPN: profits from other sources may become COMMON if there is a stipulation to such effect GR: Properties subsequently acquired by inheritance, legacy or donation, CANNOT be included in the stipulation XPN: only fruits thereof can be included in the stipulation

Y (reg ardl ess WO N they wer e obta ined thro ugh the usuf ruct cont ribut ed

Q: What is contract of sub-partnership? A: One formed between a member of a partnership and a 3rd person for a division of profits he obtained from the partnership enterprise. Q: What is the principle of delectus persaonae? A: This refers to the rule that is inherent in every partnership that no one can become a member of the partnership association without the consent of all the partners. NOTE: Even if a partner will associate another person in his share in the partnership, the associate shall not be admitted into the partnership without the consent of all the partners, even if the partner having an associate should be a manager (Art. 1804, NCC). Q: When does a partner bind the partnership? A: 1. when he is expressly or impliedly authorized 2. when he acts in behalf and in the name of the partnership Q: What are the instances of partnership tort? A: 1. where, by any wrongful act or omission of any partner acting in the ordinary course of business of the partnership or with authority of his co-partners, loss or injury is caused to any person, not being a partner in the partnership 2. where one partner, acting within the scope of his apparent authority receives money or property from a third person and misapplies it 3. where the partnership, in the course of its business, receives money or property and it is misapplied by any partner while it is in the custody of the partnership Note: Partners are SOLIDARILY LIABLE with the partnership for any penalty or damage arising from a partnership tort DISTRIBUTION OF PROFITS AND LOSSES 1. the partners share in the profits and losses according to their agreement 2. in the absence of such: a. capitalist partner—in proportion to his contribution

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

62 2007 Team Bar-Ops Civil Law Committee

b. industrial partner—what is just and equitable under the circumstances GR: stipulation excluding a partner from any share in the profits or losses is VOID XPN: industrial partner is not liable for losses (Art. 1797(2)). However, he is not exempted from liability insofar as third persons are concerned. Q: What are the relations created by a contract of partnership? A: 1. partners - partners 2. partners- partnership 3. partnership - 3rd persons with whom it contracts 4. partners - such 3rd persons Q: What are the obligations of the partner? A: Obligations with respect to contribution of property: 1. To contribute at the beginning of the partnership or at the stipulated time the money, property or industry which he may have promised to contribute 2. To answer for eviction in case the partnership is deprived of the determinate property contributed 3. To answer to the partnership for the fruits of the property the contribution of which he delayed, from the date they should have been contributed up to the time of actual delivery 4. To preserve said property with the diligence of a good father of a family pending delivery to partnership 5. To indemnify partnership for any damage caused to it by the retention of the same or by the delay in its contribution Q: What is the effect of failure to contribute property promised? A: 1. Partners become ipso jure a debtor of the partnership even in the absence of any demand 2. Remedy of the other partner is not rescission but specific performance with damages from defaulting partner Obligations with respect to contribution of money and money converted to personal use: 1. To contribute on the date fixed the amount he has undertaken to contribute to the partnership 2. To reimburse any amount he may have taken from the partnership coffers and converted to his own use 3. To pay for the agreed or legal interest, if he fails to pay his contribution on time or in case he takes any amount from the common fund and converts it to his own use 4. To indemnify the partnership for the damages caused to it by delay in the contribution or conversion of any sum for his personal benefits

Obligations with respect to contribution to partnership capital: 1. Partners must contribute equal shares to the capital of the partnership unless there is stipulation to contrary 2. Partners (capitalist) must contribute additional capital in case of imminent loss to the business of the partnership when there is no stipulation to the contrary; refusal to do so shall create an obligation on the refusing partner to sell his interest to the other partners Requisites to No. 2 above: a. Imminent loss of the business of the partnership b. Majority of the capitalist partners are of the opinion that an additional contribution to the common fund would save the business c. Capitalist partner refuses deliberately to contribute (not due to financial inability) d. There is no agreement to the contrary Obligation of managing partners who collects his personal receivable from a person who also owed the partnership: 1. Apply sum collected to 2 credits in proportion to their amounts 2. If he received it for the account of partnership, the whole sum shall be applied to partnership credit Requisites: a. At least 2 debts, one where the collecting partner is creditor and the other, where the partnership is the creditor b. Both debts are demandable c. Partner who collects is authorized to manage and actually manages the partnership Obligation of partner who receives share of partnership credit: - To bring to the partnership capital what he has received even though he may have given receipt for his share only Requisites: a. A partner has received in whole or in part, his share of the partnership credit b. Other partners have not collected their shares c. Partnership debtor has become insolvent PROHIBITION AGAINST ENGAGING IN BUSINESS

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INDUSTRIAL PARTNER

CAPITALIST PARTNER

63 CIVIL LAW NOTES

PROHIBITION

REMEDY

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

cannot engage in business (w/n same line of business with the partnership) unless partnership expressly permits him to do so

Capitalist partners may: 1. Exclude him from the firm, or 2. Avail themselves of the benefits which he may have obtained 3. Damages, in either case

cannot engage in business (with same kind of business with the partnership) for his own account, unless there is a stipulation to the contrary Capitalist partner in violation shall: 1. Bring to common fund any profits accruing to him from said transactio n, and 2. Bear all losses

Q: What are the property rights of a partner? A: (S.I.M.) 1. right to specific partnership property 2. interest in the partnership (share in the profits and surplus) 3. right to participate in the management Q: What is the nature of partner's right in specific partnership property? A: 1. Equal right to possession 2. Right not assignable 3. Right limited to share of what remains after partnership debts have been paid. Q: What are the effects of assignment of partner’s whole interest in the partnership? A: 1. Right withheld from the assignee – such assignment does not grant the assignee the right: a. To interfere in the management; b. To require any information or account; or c. To inspect partnership books. 2. Rights of assignee of partner’s interest: a. To receive in accordance with his contract the profits accruing to the assigning partner; b. To avail himself of the usual remedies provided by law in the event of fraud in the management; c. To receive the assignor’s interest in case of dissolution; and d. To require an account of partnership affairs, but only in case the partnership is dissolved, and such account shall cover the period from the date only of the last account agreed to by all the partners. Q: What are the effects of conveyance of a partner of his interest in the partnership? A: 1. conveyance of his whole interest— partnership may either remain or be dissolved

2. assignee become a partner

does

not

necessarily

MANAGEMENT OF PARTNERSHIP Q: What are the modes of appointment of manager? A: Appointment through Appointment OTHER the Articles of THAN in the Articles Partnership Power is IRREVOCABLE Power to act is without just or lawful cause REVOCABLE ANYTIME, Vote required for removal w/ or w/o cause (should be of manager done by the controlling 1. interest) for

vo 2.

w/o cause or for unjust cause

unanimous vote Extent of power

Extent of power 1. - as long as he is a if he manager, he can perform all acts of administration (if others oppose, he can be removed)

he c.

-

if he ACT S in BF

he cannot

Q: What is the rule where there are two or more managers? A: GR: each may separately execute all acts of administration (unlimited power to administer) XPN: if any of the managers opposes, decision of the majority prevails NOTE: In case of tie **Decision of the controlling interest (who are also managers) shall prevail. Q: What is the doctrine of marshalling assets? A: a. partnership creditors have preference in partnership assets

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

64 2007 Team Bar-Ops Civil Law Committee

b. separate or individual creditors have preference in separate or individual properties c. Anything left from either goes to the other. Q: What are the remedies available to creditors of a partner? A: a. separate or individual creditors should first secure a judgment on their credit; then b. apply to the proper court for a CHARGING ORDER, subjecting the interest of the debtor-partner in the partnership for the payment of the unsatisfied amount of the judgment debt with interest thereon. Q: What are the obligations of partners with regard to 3rd persons? A: 1. Every partnership shall operate under a firm name. Persons who include their names in the partnership name even if they are not members shall be liable as a partner 2. All partners shall be liable for contractual obligations of the partnership with their property, after all partnership assets have been exhausted a. Pro rata b. Subsidiary 3. Admission or representation made by any partner concerning partnership affairs within the scope of his authority is evidence against the partnership 4. Notice to partner of any matter relating to partnership affairs operates as notice to partnership except in case of fraud: a. Knowledge of partner acting in the particular matter acquired while a partner b. Knowledge of the partner acting in the particular matter then present to his mind c. Knowledge of any other partner who reasonably could and should have communicated it to the acting partner 5. Partners and the partnership are solidarily liable to 3rd persons for the partner's tort or breach of trust 6. Liability of incoming partner is limited to: a. His share in the partnership property for existing obligations b. His separate property for subsequent obligations 7. Creditors of partnership preferred in partnership property & may attach partner's share in partnership assets ACTS OF A PARTNER EFFECTS Acts in the ordinary course of business

1.

Acts not in the ordinary course of business

2.

Acts of strict dominion or ownership: a. Assign partnership property in trust for

with binding effect even if he has no authority Except: when 3rd person has knowledge of lack of authority Does not bind partnership unless authorized by other partners

creditors b. Dispose of goodwill of business c. Do an act w/c would make it impossible to carry on ordinary business of partnership d. Confess a judgment e. Enter into compromise concerning a partnership claim or liability f. Submit partnership claim or liability to arbitration g. Renounce claim of partnership Acts in contravention of a restriction on authority

Partnership not liable to 3rd persons having actual or presumptive knowledge of the restrictions

EFFECTS OF CONVEYANCE OF REAL PROPERTY BELONGING TO PARTNERSHIP Title in partnership name, Conveyance in partnership name

Title in partnership name, Conveyance in partner's name

Title in name of 1/ more partners, Conveyance in name of partner/partners in whose name title stands Title in name of 1/more/all partners or 3rd person in trust for partnership, Conveyance executed in partnership name or in name of partners Title in name of all partners, Conveyance in name of all partners

Conveyance passes title but partnership can recover if: 1. Conveyance was not in the usual way of business, or 2. Buyer had knowledge of lack of authority Conveyance does not pass title but only equitable interest, unless: 1. Conveyance was not in the usual way of business, or 2. Buyer had knowledge of lack of authority Conveyance passes title but partnership can recover if: 1. Conveyance was not in the usual way of business, or 2. Buyer had knowledge of lack of authority Conveyance will only pass equitable interest

Conveyance will pass title

Q: Who is a partner by estoppel? A: One who by words or conduct does any of the ff: 1. Directly represents himself to anyone as a partner in an existing partnership or in a nonexisting partnership 2. Indirectly represents himself by consenting to another representing him as a partner in an existing partnership or in a non existing partnership Q: What are the elements to establish liability as a partner on ground of estoppel? A: 1. Defendant represented himself as partner/ or is represented by others as such and did not deny/refute 2. Plaintiff relied on such representation

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3. Statement of defendant not refuted

1.

Q: What are the liabilities in case of estoppel?

A: All partners consented to representation No existing partnership & all those represented consented; No existing partnership & not all represented consented; None of partners in existing partnership consented

Partnership is liable Person who represented himself & all those who made representation liable pro-rata/jointly Person who represented himself liable & those who made/consented to representation separately liable

Q: What are the responsibilities of partnership to partners A: 1. Refund the amounts disbursed by partner in behalf of the partnership + corresponding interest from the time the expenses are made (loans and advances made by a partner to the partnership aside from capital contribution) 2. Answer for obligations partner may have contracted in good faith in the interest of the partnership business 3. Answer for risks in consequence of its management Q: What is dissolution? A: A change in the relation of the partners caused by any partner ceasing to be associated in carrying on the business Q: What are the causes of dissolution? A: 1. Without violating the agreement: a. termination of the definite term or specific undertaking b. express will of a partner in GF when there is NO definite term and NO specified undertaking c. express will of ALL partners (except those who have assigned or whose interests have been charged) d. expulsion in GF of a member 2. Violating the agreement 3. Unlawfulness of the business 4. Loss a. SPECIFIC THING promised as contribution is lost BEFORE delivery b. Loss of a specific thing contributed BEFORE or AFTER DELIVERY if only the USE of such is contributed 5. Death of any of the partners 6. Insolvency of any partner or of the partnership 7. Civil interdiction of any partner 8. Decree of the court Q: What are the grounds for resolution by decree of court? A: (Art. 1831) Q: What is the effect of dissolution on authority of a partner? A:

2.

General Rule – the partnership ceases to be a going concern and the partner’s power of representation is confined only to acts incidents to winding up or completing transactions begun but not then finished. (Art. 1832) Qualifications to the rule – subject to the qualifications set forth in Articles 1833 and 1834 in relation to Article 1832.

a. In so far as the partners themselves are concerned – the authority of any partner to bind the partnership by a new contract is immediately terminated when the dissolution is not by the act, insolvency, or death of a partner (a.i.d). When the dissolution is by such (a.i.d.) act, insolvency, or death, the termination of authority depends upon whether or not the partner had knowledge or notice of dissolution as provided in article 1833. Article 1833 - Where the dissolution is caused by the act, death or insolvency of a partner, each partner is liable to his copartners for his share of any liability created by any partner for the partnership as if the partnership had not been dissolved unless: i. The dissolution being by act of any partner, the partner acting for the partnership had knowledge of the dissolution; or ii. The dissolution being by the death or insolvency of a partner, the partner acting for the partnership had knowledge or notice of the death or insolvency. b. With respect to third persons (Art. 1834) – Partner continues to bind partnership even after dissolution in ff. cases: 1. Transactions to wind up partnership affairs/complete transactions unfinished 2. Transactions would bind partnership if not dissolved, when the other party/obligee: a. Situation 1 1. Had extended credit to partnership prior to dissolution & 2. Had no knowledge/notice of dissolution, or b. Situation 2 1. Did not extend credit to partnership 2. Had known partnership prior to dissolution 3. Had no knowledge/notice of dissolution/fact of dissolution not advertised in a newspaper of general circulation in the place where partnership is regularly carried on NOTE: Partner cannot bind the partnership anymore after dissolution where: 1. Dissolution is due to unlawfulness to carry on with business (except: winding up of partnership affairs) 2. Partner has become insolvent

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

66 2007 Team Bar-Ops Civil Law Committee

3. Partner unauthorized to wind up partnership affairs, except by transaction with one who: a. Situation 1 1. Had extended credit to partnership prior to dissolution & 2. Had no knowledge/notice of dissolution, or b. Situation 2 1. Did not extend credit to partnership prior to dissolution 2. Had known partnership prior to dissolution 3. Had no knowledge/notice of dissolution/fact of dissolution not advertised in a newspaper of general circulation in the place where partnership is regularly carried on

a. If the business is not continued by the other partners, to have the partnership property applied to discharge its liabilities and to receive in cash his share of the surplus less damages caused by his wrongful dissolution. b. If the business is continued: 1. To have the value of his interest in the partnership at the time of the dissolution, less any damage caused by the dissolution to his co-partners, ascertained and paid in cash or secured by bond approved by the court; and 2. To be released from all existing and future liabilities of the partnership.

NOTE: Dissolution does not discharge existing liability of partner, except by agreement between: (1) partner himself, (2) person/s continuing the business and (3) partnership creditors Q: What is winding up? A: Settling the partnership business or affairs after dissolution. Q: What is termination? A: Point in time when all partnership affairs are wound up or completed and are the end of the partnership life

Q: What are the rights of injured partner where partnership contract is rescinded? A: 1. Right of a lien on, or retention of, the surplus of partnership property after satisfying partnership liabilities for any sum of money paid or contributed by him; 2. Right of subrogation in place of partnership creditors after payment of partnership liabilities; and 3. Right of indemnification by the guilty partner against all debts and liabilities of the partnership.

Q: Who are the persons authorized to wind up? A: 1. partners designated by the agreement 2. in the absence of such, all partners who have not wrongfully dissolved the partnership 3. legal representative of last surviving partner not insolvent Q: What are the rights of a partner where dissolution is not in contravention of the agreement? A: Unless otherwise agreed, the rights of each partner are as follows: 1. To have the partnership property applied to discharge the liabilities of partnership; and 2. To have the surplus, if any, applied to pay in cash the net amount owing to the respective partners.

Q: How are the accounts settled between partners? A: 1. Assets of the partnership include: a. Partnership property (including goodwill); b. Contributions of the partners. 2. Order of application of the assets: a. First, those owing to partnership creditors; b. Second, those owing to partners other than for capital and profits such as loans given by the partners or advances for business expenses; c. Third, those owing for the return of the capital contributed by the partners; and d. Finally, the share of the profits, if any, due to each partner.

Q: What are the rights of a partner where dissolution is in contravention of the agreement? A: the rights of a partner vary depending upon whether he is the innocent or guilty partner.

Q: What is a partner’s lien? A: the right of every partner to have the partnership property applied to discharge partnership liabilities and surplus assets, if any, distributed in cash to the respective partners, after deducting what may be due to the partnership from them as partners.

1. Rights of partner who has not caused the dissolution wrongfully: a. To have partnership property applied for the payment of its liabilities and to receive in cash his share of the surplus; b. To be indemnified for the damages caused by the partner guilty of wrongful dissolution; c. To continue the business in the same name during the agreed term of the partnership, by themselves or jointly with others; and d. To possess partnership property should they decide to continue the business. 2. Rights of partner who has wrongfully caused the dissolution:

Q: What are the effects when the business of a dissolved partnership is continued? A: 1. Creditors of old partnership are also creditors of the new partnership which continues the business of the old one w/o liquidation of the partnership affairs 2. Creditors have an equitable lien on the consideration paid to the retiring /deceased partner by the purchaser when retiring/deceased partner sold his interest w/o final settlement with creditors 3. Rights if retiring/estate of deceased partner: a. To have the value of his interest ascertained as of the date of dissolution;

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b. To receive as ordinary creditor the value of his share in the dissolved partnership with interest or profits attributable to use of his right, at his option. NOTE: 1. The right to demand on accounting of the value of his interest accrues to any partner or his legal representative after dissolution in the absence of an agreement to the contrary. 2. Prescription begins to run only upon the dissolution of the partnership when the final accounting is done. Q: Who are the persons liable to render an account? A: 1. Winding up partner; 2. Surviving partner; 3. Person or partnership continuing business.

the

LIMITED PARTNERSHIP Q: What are the characteristics of a limited partnership? A: 1. One or more general partners control the business 2. One or more limited partners contribute to the capital and share in the profits but do not participate in the management of the business and are not personally liable for partnership obligations beyond their capital contributions 3. May ask for the return of their capital contributions under conditions prescribed by law 4. Partnership debts are paid out of common fund and the individual properties of general partners DIFFERENCES BETWEEN GENERAL AND LIMITED PARTNER/PARTNERSHIP GENERAL Personally liable for partnership obligations When manner of mgt. not agreed upon, all general partners have an equal right in the mgt. of the business Contribute cash, property or industry Proper party to proceedings by/against partnership Interest not assignable w/o consent of other partners Name may appear in firm name Prohibition against engaging in business Retirement, death, insolvency, insanity of gen. partner dissolves partnership

LIMITED Liability extends only to his capital contributions No participation in management Contribute cash or property only, not industry Not proper party to proceedings by/against partnership Interest is freely assignable Name must not appear in firm name No prohibition against engaging in business Does not have same effect; rights transferred to legal representative

Q: What are the liabilities of a limited partner? A: AS CREDITOR AS TRUSTEE Deficiency in contribution Unpaid contribution

Specific property stated as contributed but not yet contributed/wrongfully returned Money/other property wrongfully paid/ conveyed to him on account of his contribution

Q: When may an assignee become a limited substituted partner? A: When: 1. All the members consent to the assignee becoming a substituted partner or the limited partner, being empowered by the certificate, must give the assignee the right to become a limited partner; 2. The certificate is amended; and is registered in the SEC.

Q: What are the loans or other transactions allowed or prohibited in a limited partnership? A: 1. Allowed a. Granting loans to partnership b. Transacting business with partnership c. Receiving pro rata share of partnership assets with general creditors if he is not also a general partner 2. Prohibited a. Receiving/holding partnership property as collateral security b. Receiving any payment, conveyance, release from liability if it will prejudice right of 3rd persons Q: When does a general partner need a consent/ratification of all limited partners? A: 1. Do any act in contravention of the certificate 2. Do any act which would make it impossible to carry on the ordinary business of the partnership 3. Confess judgment against partnership 4. Possess partnership property/assign rights in specific partnership property other than for partnership purposes 5. Admit person as general partner 6. Admit person as limited partner - unless authorized in certificate 7. Continue business with partnership property on death, retirement, civil interdiction, insanity or insolvency of general partner unless authorized in certificate Q: What are the specific rights of a limited partner? A: 1. to have partnership books kept at principal place of business 2. to inspect/copy books at reasonable hour

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

68 2007 Team Bar-Ops Civil Law Committee

3. to have on demand true and full info of all things affecting partnership 4. to have formal account of partnership affairs whenever circumstances render it just and reasonable 5. to ask for dissolution and winding up by decree of court 6. to receive share of profits/other compensation by way of income 7. to receive return of contributions provided the partnership assets are in excess of all its liabilities PREFFERED LIMITED PARTNERS – by an agreement of all the members (general and limited partners stated in the certificate), priority or preference may be given to some limited partners over other limited partners as to the: 1. Return of their contributions; 2. Their compensation by way of income; or 3. Any other matter. 4. NOTE: In the absence of such statement in the certificate, even if there is an agreement, all limited partners shall stand on equal footing in respect of these matters. Q: What are the requisites for return of contribution of a limited partner? A: 1. All liabilities of the partnership have been paid or if they have yet been paid, the assets of the partnership are sufficient to pay such liabilities. 2. The consent of all the members (general and limited partners) has been obtained except when the return may be rightfully demanded; and 3. The certificate is cancelled or amended. Q: When is the return of contribution a matter of right? A: When all liabilities of the partnership, except liabilities to general partners and to limited partners on account of their contributions, have been paid or there remains property of the partnership sufficient to pay them and the certificate is cancelled or so amended as to set forth the withdrawal or reduction: 1. On the dissolution of the partnership; or 2. Upon the arrival of the date specified in the certificate for the return; or 3. After the expiration of 6 months’ notice in writing given by him to the other partners if no time is fixed in the certificate for the return of the contribution or for the dissolution of the partnership. NOTE: Even if a limited partner has contributed property, he has only the right to demand and receive cash for his contribution. The exceptions are: 1. When there is stipulation to the contrary in the certificate; or 2. When all the partners (general and limited partners) consent to the return other than in the form of cash. Q: What are the liabilities of a limited partner? A. To the partnership:

Since limited partners are not principals in the transaction of a partnership, their liability as a rule, is to the partnership, not to creditors of the partnership. The general partners cannot, however waive any liability of the limited partners to the prejudice of such creditors. B. To the partnership creditors and other partners: 1. A limited partner is liable for partnership obligations when he contributed services instead of only money or property to the partnership; 2. When he allows his surname to appear in the firm name; 3. When he fails to have a false statement in the certificate corrected, knowing it to be false; 4. When he takes part in the control of the business; 5. When he receives partnership property as collateral security, payment, conveyance, or release in fraud of partnership creditors; and 6. When there is failure to substantially comply with the legal requirements governing the formation of limited partnerships. C. To separate creditors As in a general partnership, the creditor of a limited partner may, in addition to other remedies allowed under existing laws, apply to the proper court for a charging order subjecting the interest in the partnership of the debtor partner for the payment of his obligation. Q: What are the requisites for waiver or compromise of liabilities? A: 1. The waiver or compromise is made with the consent of all partners; and 2. The waiver or compromise does not prejudice partnership creditors who extended credit or whose claims arose before the cancellation or amendment of the certificate. Q: When may a limited partner have the partnership dissolved? A: 1. When his demand for the return of his contribution is denied although he has a right to such return; or 2. When his contribution is not paid although he is entitled to its return because the other liabilities of the partnership have not been paid or the partnership property is insufficient for their payment. DISSOLUTION OF LIMITED PARTNERSHIP: Priority in Distribution of Assets (Art. 1863)

AGENCY Q: What are the characteristics of a contract of agency? A: 1. Bilateral – if it is for compensation because it gives rise to reciprocal rights and obligations; and 2. Unilateral – if it gratuitous because it creates obligations for only one of the parties

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3. Nominate 4. Consensual 5. Principal 6. Preparatory – it is entered into as a means to an end.

d.

Q: What is the purpose of agency? A: to extend the personality of the principal through the facility of the agent. Q: Who are the parties to the contract? A: 1. Principal – one whom the agent represents and from whom he derives his authority 2. Agent – one who acts for and represents another Q: What are the essential elements of agency? A: 1. consent, express or implied, of the parties to establish the relationship; 2. The object is the execution of a juridical act in relation to third persons; 3. The agent acts as a representative and not for himself; and 4. The agent acts within the scope of his authority.

e.

c.

Q: What are the acts that cannot be done by agent? A: Personal Acts 1. Criminal or Illegal Acts

d.

Q: What is the nature of relationship between Principal & Agent? A: Fiduciary, based on trust & confidence a.

b.

c.

Agent represe nts a capacit ated person agent derives authorit y from the princip al agent is appoint ed by the princip al and can be

GUARDIANSHIP a. guardian represents an incapacitate d person

b.

c.

guardian derives authority from the court the guardian is appointed by the court, and stands in loco parentis

agent can make the princip al person ally liable

AGENCY a. agent is appoint ed by the princip al b. represe nts the princip al

NOTE: PRINCIPAL: may be a natural or a juridical person. -he must be capacitated. -The rule is: if a person is capacitated to act for himself or his own right, he can act through an agent. AGENT: insofar as the third persons are concerned, it is enough that the principal is capacitated. But insofar as his obligations to his principal are concerned, the agent must be able to bind himself.

AGENCY

remove d by the latter agent is subject to directio ns of the princip al

agent does not file a bond he is controll ed by the princip al thru the agreem ent

d. guardian is NOT subject to the directions of the ward, but must act for the ward’s benefit

e. guardian has no power to impose personal liability on the ward

JUDICIAL ADMINISTRATION i. judicial administrator is appointed by the court

ii.

he represents not only the court but also the heirs and creditors of the estate

iii.

administrator files a bond

iv.

his acts are subject to specific orders from the court

AGENCY a. agent represents the principal b.

relationship can be terminated at the will of either principal or agent

c.

agent exercises discretionary powers

LEASE OF SERVICES a. worker or lessor of services does not represent his employer b. generally, relationship can be terminated only at the will of both c. employee has ministerial functions

AGENCY

TRUST

a. agent usually holds no title at all

a.

b. agent usually acts in the name of the principal

b.

c. agency usually may be terminated or revoked any

c.

trustee may hold legal title to the property trustee may act in his own name trust is usually ended by the

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

70 2007 Team Bar-Ops Civil Law Committee

time

d. agency may not be connected at all with property

d.

e. agent has authority to make contracts which will be binding on his principal

e.

f. agency is really a contractual relation

f.

accomplishment of the purposes for which it was formed trust involves control over property trustee does not necessarily or even possess such authority to bind the trustor or the cestui que trust a trust may be the result of the contract or not; it may be created also by law

IMPLIED AGENCY

AGENCY BY ESTOPPEL 1. 1. b/w principal and agent b/w a. if caused by the “agent”, he is not a. agent is a true agent, considered a true agent, with rights and duties hence, he has no rights of an agent as such 2. as to 3rd persons 2. as to 3rd persons a. the principal is a. if caused by the always liable principal, he is liable, but b. the agent is never only if the 3rd person personally liable acted on the misrepresentation b. if caused by the agent alone, only the agent is liable

Q: What are the classifications of Agency? A. As to manner of creation 1. Express – agent has been actually authorized by the principal, either orally or in writing 2. Implied – agency is implied from the acts of the principal, from his silence or lack of action or his failure to repudiate the agency knowing that another person is acting on his behalf without authority, B. As to character 1. Gratuitous – agent receives no compensation for his services 2. Onerous – agent receives compensation for his services C. As to extent of business of the principal 1. General – agency comprises all the business of the principal 2. Special – agency comprises one or more specific transactions D. As to authority conferred 1. Couched in general terms – agency is created in general terms and is deemed to comprise only acts in the name and representation of the principal 2. Simple or Commission – agent acts in his own name but for the account of the principal NOTE: General rule – there are no formal requirements governing the appointment of an agent. Exception - when the law requires a specific form. Form of Acceptance by Agent: A. Express

B. Implied - when it can be inferred from the acts of the agent which carry out the agency, or from his silence of inaction according to the circumstances 1. Between persons who are present – implied acceptance if the principal delivers his power of attorney to the agent and the latter receives it without any objection 2. Between persons who are absent – acceptance not deemed implied from the silence of the agent. Exceptions: a. When the principal transmits his power of attorney to the agent, who receives it without any objection. b. When the principal entrusts to him by letter or telegram a power of attorney with respect to the business in which he is habitually engaged as an agent, and he did not reply to the letter or telegram. Q: What are the ways of giving notice of agency? A: 1. By special information - the person appointed as agent is considered such with respect to the person to whom it was given. 2. By public advertisement - the agent is considered such with regard to any person. NOTE: The power of attorney must be revoked in the same manner in which it was given. AGENCY COUCHED IN GENERAL TERMS: - may be general or special - includes only acts of administration and an express power is necessary to perform any act of strict ownership even if the principal states that: 1. he withholds no power 2. agent may execute such acts as he may consider appropriate 3. general or unlimited management is authorized Q: What is a Power of Attorney? A: An instrument in writing by which one person, as principal, appoints another as his agent and confers upon him the authority to perform certain specified acts or kinds of acts on behalf of the principal; primary purpose is to evidence agent’s authority to third parties within whom the agent deals. Q: What are the instances when a special power of attorney is necessary? A : (Article 1878) GR: Knowledge of agent is knowledge of principal EXCEPTIONS: 1. agent’s interests are adverse to those of the principal 2. agent’s duty is not to disclose the information (confidential information)

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3. where the person claiming the benefit of the rule colludes with the agent to defraud the principal NOTE: In a sale of a piece of land/any interest therein, agent’s authority must be in writing, otherwise sale is void. Q: What are not included in the power to mortgage? 1. to sell 2. to execute a second mortgage 3. to mortgage for the agent’s or any 3rd persons’ benefit, UNLESS clearly indicated. NOTE: Power to compromise does not include submission to arbitration. Q: What are the effects of agent’s acts? A: A. WITH Authority 1. in principal’s name—valid 2. in his own name—not binding on the principal; agent and stranger are the only parties, except regarding things belonging to the principal or when the principal ratifies the contract or derives benefit therefrom B. WITHOUT Authority 1. in principal’s name—unauthorized and unenforceable but may be ratified, in which case, may be validated retroactively from the beginning 2. in his own name—valid on the agent, but not on the principal Q: When is the principal bound by the act of the agent? A: When the agent acted within the scope of his authority; and in behalf of the principal. NOTE: The principal is bound by either actual or apparent authority of the agent: a. So long as the agent has actual authority, express or implied, the principal is bound by the acts of the agent on his behalf, whether or not the third person dealing with the agent believes that the agent has actual authority. b. Under the doctrine of apparent authority, the principal is liable only as to third persons who have been led reasonably to believe by the conduct of the principal that such actual authority exists, although none has been given. Q: When is the principal not bound by the act of the agent? A: 1. When the act is without or beyond the scope of his authority in the principal’s name; 2. When the act is within the scope of his authority but in his own name, except when the transaction involves things belonging to the principal. Q: Is the principal liable for the expenses incurred by the agent? A: YES Exceptions:

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

1. If the agent acted in contravention of the principal's instructions, unless principal derives benefits from the contract 2. When the expenses were due to the fault of the agent 3. When the agent incurred them with knowledge that an unfavorable result would ensure, if the principal was not aware thereof 4. When it was stipulated that the expenses would be borne by the agent, or that the latter would be allowed only a certain sum Q: What are the conditions for ratification? A: PRINCIPAL MUST: 1. have capacity and power to ratify; 2. have had knowledge of material facts; 3. ratify acts in its entirety; SUCH ACTS MUST: be capable of ratification; And must be done in behalf of the principal Q: What are the effects of ratification? A: a. with respect to agent - relieves the agent from liability to the third party for the unauthorized transaction, and to his principal for acting without authority; may recover compensation b. with respect to principal - assumes responsibility for the unauthorized act, as if the agent had acted under original authority but not liable for acts outside the authority approved by his ratification c. with respect to 3rd persons - bound by ratification to the same extent as if the ratified act had been authorized; cannot raise the question of the agent’s lack authority to do the ratified act Q: What are the Distinctions between Authority and the Principal’s Instructions? A: AUTHORITY INSTRUCTIONS Sum total of the powers committed to the agent by the principal Relates to the subject/business with which the agent is empowered to deal or act limitations of authority are operative as against those who have/charged with knowledge of them contemplated to be made known to third persons dealing with the agent

contemplates only a private rule of guidance to the agent; independent and distinct in character refers to the manner or mode of agent’s action

without significance as against those with neither knowledge nor notice of them not expected to be made known to those with whom the agent deals

ESTOPPEL TO DENY AGENCY: 1. Estoppel of agent – one professing to act as agent for another may be estopped to deny his agency both as against his asserted principal and the third persons interested in the transaction in which he engaged. 2. Estoppel of principal – a. As to agent – one, who knows that another is acting as his agent and fails to repudiate

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

72 2007 Team Bar-Ops Civil Law Committee

his acts, or accepts the benefits of them, will be estopped to deny the agency as against such other. b. As to sub-agent – to estop the principal from denying his liability to a third person, he must have known or be charged with knowledge of the fact of the transaction and the terms of the agreement between the agent and sub-agent. c. As to third persons – one who knows that another is acting as his agent or permitted another to appear as his agent, to the injury of third persons who have dealt with the apparent agent as such in good faith and in the exercise of reasonable prudence, is estopped to deny the agency. 3. Estoppel of third persons – a third person, having dealt with one as agent may be estopped to deny the agency as against the principal, agent, or third persons in interest. 4. Estoppel of the government – the government is neither estopped by the mistake or error on the part of its agents. NOTE: The agent may appoint a substitute except when he has been prohibited by the principal • The agent shall be responsible for the acts of the substitute 1. when he was not given the power to appoint 2. when he was given such power but without designating the person and the person appointed was notoriously incompetent or insolvent Q: What is the responsibility of two or more agents appointed simultaneously? A: General rule: liable jointly Exception: solidarity has been expressly stipulated; each of the agents becomes solidarily liable for: 1. The non-fulfillment of the agency; or 2. For the fault or negligence of his fellow agent Exception to the exception: when one of the other agents acts beyond the scope of his authority – innocent agent is NOT liable. Q: Who is a factor/commission agent? A: One engaged in the purchase & sale for a principal of personal property, which, for this purpose, has to be placed in his possession & at his disposal Q: Who is a broker? A: Middleman or intermediary who in behalf of others and for a commission or fee, negotiates contracts/transactions relating to real or personal property Q: What is a factorage? A: Compensation of a factor or commission agent Q: What is an Ordinary Commission? A: compensation for the sale of goods that are placed in his possession or at his disposal

Q: What is a guaranty commission? A: fee which is given in return for the risk that the agent has to bear in the collection of credits Q: What are the modes of extinguishment of agency? A: (EDWARD) 1. Expiration of the period 2. Death, civil interdiction, insanity or insolvency of principal or of the agent 3. Withdrawal of the agent 4. Accomplishment of the object or the purpose of the agency 5. Revocation 6. Dissolution of the firm or corporation that entrusted or accepted the agency. NOTE: The list is not exclusive; causes particular only to agency; may also be extinguished by the modes of extinguishment of obligations in general whenever they are applicable, like loss of the thing and novation. Q: What is the “Presumption of Continuance of Agency”? A: It means that when once shown to have existed, an agency relation will be presumed to have continued, in the absence of anything to show its termination. NOTE: In Continuance of Agency: parties must be (1) present, (2) capacitated and (3) solvent Q: Can the heirs continue the agency? A: General rule: No. The agency calls for personal services on the part of the agent; rights & obligations intransmissible. Exceptions: 1. agency by operation of law, or a presumed or tacit agency 2. agency is coupled with an interest in the subject matter of the agency (ex. power of sale in a mortgage) Q: What is the effect of a change of circumstance surrounding the transaction? A: GR: the authority of the agent is terminated. Exceptions: 1. If the original circumstances are restored within a reasonable period of time, the agent's authority may be revived; 2. Where the agent has reasonable doubts as to whether the principal would desire him to act, his authority will not be terminated if he acts reasonably; 3. Where the principal and agent are in close daily contact, the agent's authority to act will not terminate upon a change of circumstances if the agent knows the principal is aware of the change and does not give him new instructions. GENERAL RULE: Agency is REVOCABLE at will by the principal EXCEPTIONS: 1. If a bilateral contract depends upon it

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2. if it is the means of fulfilling an obligation already contracted 3. if a partner is appointed manager of a partnership and his termination is unjustifiable 4. if it is created not only for the interest of the principal but also for the interest of third persons Q: Is there a necessity of notice of revocation? A: 1. as to the agent - express notice is not necessary; sufficient notice if the party to be notified actually knows, or has reason to know, a fact indicating that his authority has been terminated/suspended; revocation without notice to the agent will not render invalid an act done in pursuance of the authority 2. as to 3rd persons – express notice necessary a. as to former customers - actual notice must be given to them because they always assume the continuance of the agency relationship b. as to other persons - notice by publication is enough NOTE: There is implied revocation of the previous agency when the principal appoints a new agent for the same business or transaction provided there is incompatibility. But the revocation does not become effective as between the principal and the agent until it is in some way communicated to the latter. Q: What is the effect of the direct management by the principal? A: GR: The agency is revoked for there would no longer be any basis for the representation previously conferred. But the principal must act in good faith and not merely to avoid his obligation to the agent. EXCEPTION: the only desire of the principal is for him and the agent to manage the business together Q: How is the agency revoked when the agent has been appointed by two or more principals? A: any one of the principals is granted the right to revoke the power of attorney without the consent of the others. Q: Can the agent w/draw from the agency? A: the agent may renounce or withdraw from the agency at any time, without the consent of the principal, even in violation of the latter’s contractual rights; subject to liability for breach of contract or for tort. 1. Without just cause – the law imposes upon the agent the duty to give due notice to the principal and to indemnify the principal should the latter suffer damage by reason of such withdrawal. 2. With just cause – the agent cannot be held liable.

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

A: A general power of attorney is revoked by special one granted to another agent, as regards the special matter involved in the latter.

TRUSTS Q: Who are the persons involved in the creation of a trust? A: 1. Trustor – one who intentionally creates a trust 2. Trustee – one who holds the legal title to the trust property for the benefit of another and with certain powers and subject to certain duties 3. Beneficiary or the cestui que trust – one who has the equitable interest in the property and enjoys the benefit of administration by the trustee. - may be a natural person or a legal entity NOTE: trustor may establish a trust with himself as the beneficiary (usual case). A trust arises from or is the result of a fiduciary relation between the trustee and the cestui que trust as regards certain property – real, personal, funds or money or choses in action held by the trustee. Q: What are the characteristics of the office of the trustee? A: 1. As principal – The trustee is not an agent of the trust estate or of the cestui que trust, but he acts for himself in the administration of the trust estate, although subject to the terms of the trust and law of trusts. 2. As agent – In some cases, however, a trustee has been regarded as an agent of beneficiaries of the trust at least for certain purposes, such as for the purpose of imputing to the beneficiaries of the trust notice given to the trustee. 3. As fiduciary – A trustee, like an executor or administrator, holds an office of trust. The duties of the latter are, however, fixed and/or limited by law, whereas those of trustee of an express trust are usually governed by the intention of the trustor or of the parties, if established by contract. Q: What are the classifications of a trust? A: *From the viewpoint of whether they become effective after the death of the trustor or during his life, it may either be: 1. testamentary trusts 2. trusts inter vivos (living trusts) *From the viewpoint of the creative force bringing it into existence: 1.

Express trust – exists only by the manifestation of an intention to create it by the one having legal and equitable dominion over the property made subject to it;

2.

Implied trust – exists either through implication of an intention to create a trust as a matter of

Q: What is the effect of a partial revocation of a general power by special power?

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

74 2007 Team Bar-Ops Civil Law Committee

law or through the imposition of the trust irrespective of and even contrary to any such intention; it may either be: a. A resulting trust – arises where a person makes or causes to be made a disposition of property under circumstances which raise an inference that he does not intend that the person taking or holding the property should have the beneficial interest in the property; is founded on the presumed intention of the parties; OR b. A constructive trust –imposed where a person holding title to property is subject to an equitable duty to convey it to another on the ground that he would be unjustly enriched if he were permitted to retain it; NOTE: the duty to convey the property arises because it was acquired through fraud, duress, undue influence, mistake, or through breach of a fiduciary duty, or through the wrongful disposition of another’s property.

The beneficiary of a trust may demand performance of the obligation without having formally accepted the benefit of the trust in a public document, upon mere acquiescence in the formation of the trust and acceptance under the second paragraph of Art. 1311 (Stipulations pour autrui).

TRUST Always involves ownership, embracing a set of rights and duties fiduciary in character which may be created by a declaration without consideration.

EXPRESS TRUST

Q: What are the elements of express trust? A: 1. A competent trustor and trustee; 2. An ascertainable trust res; and 3. Sufficiently certain beneficiaries. Q: Who has the burden of proving a trust? A: the burden is on the party alleging its existence General rule: A trust whether express or implied may be proved by parol or oral evidence. Exception: An express trust over an immovable property or any interest therein may not be proved by parol evidence. By virtue of Article 1443, WRITTEN INSTRUMENT is necessary to prove an express trust concerning an immovable or any interest therein. Hence, by analogy, this requirement may also be included under the Statute of Frauds. Q: How is an express trust created? A: created by direct and positive act of the trustor, by some writing, deed, will, or oral declaration. NOTE: The trustor must be capacitated to convey property; and capacitated to hold property and to enter into contract. While on the other hand, the beneficiary must be capacitated to receive gratuitously from the trustor. Q: WHAT ARE THE DISTINCTIONS BETWEEN TRUST AND OTHER RELATIONS? A: TRUST BAILMENT The delivery of property involves a transfer of legal title or at least a separation of equitable interest and legal title and vests the title in the trustee.

separation of legal and equitable title.

The bailee has possession of the property but has no legal title over it.

TRUST

DONATION

An existing legal relationship and involves the

There is a transfer of property as well as the disposition of both legal

1. Created by the intention of the parties 2. An express trust over an immovable or any interest therein cannot be proved by parol evidence. 3. An express repudiation made known to the beneficiary is necessary in order that laches or acquisitive prescription may bar an action to enforce an express trust.

and equitable ownership except in cases of gifts in trust.

The donee must comply with the legal requirements in accepting donations.

CONTRACT A legal obligation based on an undertaking supported by a consideration, which obligation may or may not be fiduciary in character.

IMPLIED TRUST 1. Come into being by operation of law 2. An implied trust over an immovable or any interest therein may be proved by oral evidence. 3. Not necessary that an express repudiation be made in order to bar an action to enforce an express trust.

RESULTING TRUST

CONSTRUCTIVE TRUST

1. The intent of the parties to create a trust is presumed or implied by law from the acts of the parties.

1. The trust is created irrespective of or even contrary to the intention of the parties to promote justice, frustrate fraud and to prevent unjust enrichment. 2. The 10-year prescriptive period shall be counted from the time that the constructive trust arises.

2. The 10-year prescriptive period shall be counted from the time repudiation is made known to the beneficiary

Q: Is acceptance necessary for the creation and validity of trust relationship? A: 1. Acceptance of the trustee: -is not necessary to its existence and validity since if he declines, the courts will appoint a trustee to fill the office that he chose to decline. - But a trustee’s acceptance of the trust is necessary to charge him with the office of the trustee and the administration of the trust and to vest the legal title in him. 2. Acceptance of the beneficiary: -Is essential to the creation and validity of trust. However, such acceptance is presumed if there is no proof to the contrary and the trust does not impose any onerous condition upon the beneficiary.

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NOTE: The rule that trustee cannot acquire by prescription ownership over property entrusted to him until and unless he repudiates the trust, applies to express trusts and resulting trusts. The trustee may claim title by prescription founded on adverse possession where it appears that: 1. He has performed open and unequivocal acts of repudiation amounting to an ouster of the cestui que trust; 2. Repudiation was made known to the cestui que trust; 3. The evidence is clear and conclusive or convincing; and 4. The period fixed by law has prescribed. Q: What is the prescriptive period for an action of reconveyance to enforce an implied trust in one’s favor? A: It prescribes in ten (10) years from the time the right of action accrues. But the prescriptive rule applies only when the plaintiff or the person enforcing the trust is not in possession of the contested property, since if a person claiming to be the owner thereof is in actual possession of the property, the right to seek reconveyance, which in effect, seeks to quit title does not prescribe. Q: What is the trust pursuit rule? A: Equity will pursue property that is wrongfully converted by the fiduciary or otherwise compel restitution to the beneficiary. Q: What is a purchase money resulting trust? A: That which arises in favor of a person from whom a consideration comes for a conveyance of property, whether realty or personality, to another. Examples: 1. Donations made to a person but the beneficial interest is vested in another. The donee is the trustee while the designated third person is the beneficiary. (Art. 1449) 2. Purchase with borrowed funds and the conveyance is made to lender to secure payment of debt. (Art. 1450) 3. Legal title to property purchased taken in one co-owner. (Art. 1452) 4. Legal title to land inherited by heir placed in the name of another. (1451) 5. Conveyance to a person to secure performance of grantor’s obligation. (1454)

SALES Q: What is a Contract of Sale? A: (Art. 1458) Q: What is a contract to sell? A: A conditional sale where the seller, while reserving the ownership of the property despite delivery to the buyer, binds himself to sell the said property exclusively to the buyer upon full payment. Q: State the basic differences (only in their legal effects) between: A. a contract to sell, and a contract of sale B. a conditional sale and an absolute sale

A: Contract of sale Ownership is transferred to the buyer upon delivery of the object to him There is only one contract executed between the seller and the buyer

Conditional sale One where the vendor is granted the right to unilaterally rescind the contract predicated on the fulfillment or nonfulfillment, as the case may be, of the prescribed condition.

Contract to sell Ownership is retained by the seller until the purchase price is fully paid There are two contracts, first the contract to sell (which is conditional or preparatory sale) and a second, the final deed of sale or the principal contract which is executed after full payment of the purchase price Absolute sale One where the title to the property is not reserved to the vendor or if the vendor is not granted the right to rescind the contract based on the fulfillment or nonfulfillment, as the case may be, of the prescribed condition.

Q : What is the status of the following contract of sale ? A: 1. That entered into by minors: • voidable only, therefore ratifiable • remedy is action for annulment (with partial restitution in so far as the minor is benefited) • where necessaries are sold and delivered – minor must pay reasonable price (Art. 1489) 2. Sale by & between spouses (Art. 1490): a. Contract with 3rd parties: VALID b. Sale between spouses: General Rule: VOID Reasons: i. prevent defrauding creditors ii. avoid situation where dominant spouse take advantage of weaker spouse iii. avoid circumvention on prohibition of donation between spouses XPNS: i. separation of property agreed (marriage settlement) ii. judicial separation of property 3. Between Common Law Spouses (Paramours)

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

76 2007 Team Bar-Ops Civil Law Committee

• Status of contract: VOID (per case law) Q: Who are the persons prohibited by law from acquiring property by purchase? A: (AGE-COP) 1. Agent w/ regard to property of principal XPN: if principal gave consent. 2. Guardian w/ regard to property of ward during period of guardianship • Contracts entered by guardian in behalf of ward are rescissible if ward suffers lesion by more than ¼ of the value of property. • 2. 3. Executor/administrator w/ regard to the estate of the deceased 4. Court officers & employees – with regard to property in litigation 5. Others specially disqualified by law. 6. Public officers w/ regard to the property of the state Q: Who are those “others” specially disqualified? A: • Aliens who are disqualified to purchase private agricultural lands (Art XII secs. 3 &7) • Unpaid seller having a right of lien or having stopped the goods in transitu, is prohibited from buying the goods either directly or indirectly in the resale of the same at public/private sale which he may make (Art. 1533 (5); Art 1476 (4)) • The officer holding the execution or deputy cannot become a purchaser or be interested directly or indirectly on any purchase at an execution. (Sec. 21 Rule 39) • In sale by auction, seller cannot bid unless notice has been given that such sale is subject to a right to bid in behalf of the seller. (Art. 1476) Q: What are the objects of sale? A: 1. Existing Goods 2. Future Goods-goods to be manufactured raised or acquired by seller after perfection of the contract Q: Can RIGHTS be the objects of sale? A: YES, if they are transmissible.( Art..1347 1st par, 2nd sentence) NOTE: Object must be licit otherwise contract void. Vendor must have right to transfer ownership at the time of delivery. *services- CANNOT be the object of sale. They are not determinate things and no transfer of ownership is available in services. 1. 2. 3.

Price: Must bereal in money or its equivalent certain or ascertainable at the time of the perfection of the contract Q: When is the price certain?

A: (Art. 1469) Emptio Res Speratae Potential Existence

Emptio Spei (Sale of Hope)

1. Sale of thing having potential existence 2. Uncertainty is w/ regard quantity & quality 3. Contract deals w/ future thing

1. Sale of mere hope or expectancy 2. Uncertainty is w/ regard to existence of thing

4. Sale is valid only if the expected thing will exist.

3. Contract deals w/ present thing-hope or expectancy 4. Sale is valid even though expected thing does not come into existence as long as the hope itself validly existed. (eg. lotto)

NOTE: Presumption is Emptio Res Sperata Sale and other Contracts SALE DONATION Onerous Consensual Law on Sales

Gratuitous Formal contract Law on Donation

SALE

BARTER

Consideration is giving of money as payment

Consideration is giving of a thing

• •

both are governed by law on sales; if consideration consists party in money & partly by thing – look at manifest intention; if intention is not clear (1468 ): 1.value of thing is equal or less than amount of money – Sale 2.value of thing is more than amount of money – Barter

SALE

CONTRACT FOR PIECE OF WORK

Goods are manufactured and sold by vendor in the ordinary course of business

Goods are manufactured specially for a customer, upon special order and not for the general market (Art. 1469)

SALE 1.Buyer pays for price of object 2.buyer becomes owner of thing 3.seller warrants 4.not unilaterally revocable; 5.seller receives profit

SALE 1. No pre-existing credit. 2.Buyer-seller relationship

AGENCY TO SELL 1. Agent not obliged to pay for price; must account for the proceeds of the sale. 2.principal remains the owner even if the object delivered to agent 3.agent assumes no personal liability as long as within authority given 4. May be revoked unilaterally even w/o ground 5. Agent not allowed

DACION EN PAGO 1. Contract where property is alienated to extinguish preexisting credit/debt. 2.novates CR-DR relationship into seller-buyer

SALE

LEASE

1.obligation to absolutely transfer ownership of thing 2.consideration is price 3.seller needs to be owner of thing to transfer ownership lease with option to buy: really a contract of sale but designated as

1.use of thing is for specified period only with obligation to return 2.consideration is the rental

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*Sale of real property or interest therein

lease in name

Q: What are the 3 Stages in the Life of a Contract of Sale? A: 1. Preparation/conception Stage – period of negotiation and bargaining 2. Perfection – concurrence of all requisites; meeting of the minds 3. Consummation – parties perform their respective undertakings (delivery of thing and payment of price) fulfillment or performance of the terms agreed upon in the contract OPTION CONTRACT 1. Principal contract; stands on its own 2.Needs separate consideration 3. Subject matter & price must be valid 4. Not conditional 5 Not subject to specific performance

RIGHT OF REFUSAL

FIRST

1. Accessory; can not stand on its own 2. Does not need separate consideration 3. There must be subject matter but price not important 4. Conditional 5. Subject to specific performance

Q: What is an Earnest Money? A: It is a partial payment of the purchase price and considered as proof of the perfection of contract. Q: What is an Earnest deposit? A: It is neither part of the purchase price nor a proof of the perfection of the contract of sale but only a GAUARANTEE that the prospective buyer would not back out of the sale. EARNEST MONEY 1. Part of purchase price advanced by vendee to vendor as a token of the perfection of the contract. 2.Given only where there is already perfected sale 3. When given, buyer is bound to pay the balance 4. If sale did not materialized, return money paid unless agreed otherwise.

OPTION MONEY 1. A distinct consideration for an option contract 2. Applies to sale not yet perfected only option contract is perfected 3. The would-be buyer is not required to buy. 4.if buyer does not buy the thing, he cannot recover money paid as consideration for the contract of option.

Q: What are the Formalities of Contract of Sale? A: GR: Sale being consensual, may be oral or written, XPNS: 1. If particular form is required under the Statute of Frauds 2. When form is important for validity * Power to sell a piece of land granted to an agent *sale of large cattle; must also be registered with Municipal treasurer *sale of land by non-Christian if not approved by Governor – VOID. 3. When form is important for enforceability (STATUTE OF FRAUDS) *sale to be performed 1 year after *Agreement to sell things with value of 500 and up

XPNS: 1. When there is a note or memorandum in writing & subscribed by party or his agent 2 When there has been partial performance/execution 3. when there has been failure to object to presentation of evidence (oral) Q: What are the obligations of the vendor? A: 1) Deliver the thing sold 2) Transfer the ownership 3) Warranties 4) Take care of the thing, pending delivery, with proper diligence 5) Pay for the expenses of the deed of sale unless there is a stipulation to the contrary Q: What is the Obligation of the vendee? A: Payment of the price Q: What are the different kinds of delivery? A: Actual - thing sold is placed under the control and possession of vendee/agent Constructive -does not confer physical possession of the thing, but by construction of law, is equivalent to acts of real delivery. I.Tradicion symbolica - delivery of certain symbols representing the thing ii. Tradicion Instrumental – delivery of the instrument of conveyance. iii. Traditio Longa Manu- Delivery of thing by mere agreement; when SELLER points to the property without need of actually delivering iv. Tradicion Brevi Manu-Before contract of sale, the would-be buyer was already in possession of the would-be subject matter of sale v. Constitutum possessarium-at the time of perfection of contract, seller continues to have possession merely as a holder 3. Quasi-tradition-delivery of rights, credits or incorporeal property 4. Tradition by operation of law Q: Where is the place of delivery? A: 1) That agreed upon 2) Place determined by usage of trade 3) Seller’s place 4) Seller’s residence 5) In case of specific goods, where they can be found Note: Delivery should be coupled with intention of delivering the thing, and acceptance on the part of the vendee to give legal effect of the act. Without such intention, there is no such tradition. Q: What is the effect of delivery? A: Title /ownership is transferred XPN: contrary is stipulated as in the case of:

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

78 2007 Team Bar-Ops Civil Law Committee

1. pactum reservatii in domini – agreement that ownership will remain with seller until full payment of price. (Contract to sell) 2. sale on acceptance/approval 3. sale or return 4. there is implied reservation of ownership Q: Who bears the expenses of delivery? A: Seller Q: What is the rule on Double Sale? A: FIRST IN TIME, PRIORITY IN RIGHT Requisites: 1. same subject matter 2. same immediate seller 3. two different buyers 4. both sales are valid Q: What are the rules according to Article 1544? 1. MOVABLE • owner who is first to possess in good faith 2. IMMOVABLE • First to register in good faith • No inscription, first to possess in good faith • No inscription & no possession in good faith – Person who presents oldest title in good faith Q: Who is a buyer in Good Faith? A: one who buys property without notice that another person has a right or interest in such property NOTE:  Possession - Both actual or constructive  Registration 1. registered under Torrens system 2. not registered under the Torrens system  where situation is that 1st sale deals with land when not yet registered & 2nd sale is done when land already registered – apply FIRST IN TIME, PRIORITY IN RIGHT Principle Q: Who Bears Risk of Loss/Deterioration? A: Before Perfection At Perfection

Res perit domino-Seller is the owner so seller bears risk of loss

After Perfection /Before Delivery

Res perit domino Contract is merely inefficacious- loss of the subject matter does not affect the validity of the sale Seller cannot anymore comply with obligation so buyer cannot anymore be compelled

After Delivery

2 Views: Paras: BUYER, except: (1) when object sold consists of fungible goods for a price fixed (2) when seller is guilty of fraud, negligence, default, or violation of contractual terms; or (3) when object sold is generic. Tolentino: SELLER Deterioration & fruits Buyer bears loss

Res perit domino Buyer becomes the owner so buyer bears risk of loss Delivery extinguish ownership vis-a-vis the seller & creates a new one in favor of the buyer

Q: What are the remedies of an Unpaid Seller? A: (Art. 1526) I.GENERAL 1. Possessory Lien • Seller not bound to deliver if buyer has not paid him the price • Exercisable only in following circumstances: a. goods sold without stipulation as to credit b. goods sold on credit but term of credit has expired c. buyer becomes insolvent • When part of goods delivered, may still exercise right on goods undelivered Q: What are the instances when possessory lien is lost? A: a. seller delivers without reserving ownership in goods or right to possess them b. buyer or agent lawfully obtains possession of goods c. waiver NOTE: Seller loses lien when he parts with goods (but still, stoppage in transitu can be exercised) 2. Stoppage in Transitu • Requisites: (i-u SENT) 1) insolvent buyer 2) Unpaid seller 3) Seller must surrender the negotiable document of title, if any 4) Seller must bear the expenses of delivery of the goods after the exercise of the right. 5) Seller must either actually take possession of the goods sold or give notice of his claim to the carrier or other person in possession 6) Goods must be in transit 3. Special Right to Resell the Goods • Requisites: a. goods are perishable b. stipulated the right of resale in case of default c. buyer in default for unreasonable time 4. Special Right to Rescind • Requisites: a. Expressly stipulated b. Buyer is in default for unreasonable time 5. Action for Price • Exercised when:

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a. ownership has passed to buyer b. price is payable on a day certain c. goods cannot readily be resold for reasonable price and Art 1596 is inapplicable

a. Pay w/o interest the balance w/in grace period of 1 month for every year of installment payment • Grace pd to be exercised once every 5 years b. When no payment - cancelled; buyer entitled to 50% of what he has paid + 5% for every year but not exceeding 90% of payments made • Cancellation to be effected 30 days from notice & upon payment of cash surrender value

6. Action for Damages • in case of wrongful neglect or refusal by the buyer to accept or pay for the thing sold II.

SPECIAL

Alternative Remedies in case of sale of Personal Property in Installments (Recto Law, Art. 1484) 1. Exact fulfillment should the buyer fail to pay 2. Cancel the sale if buyer fails to pay 2 or more installments 3. Foreclose on chattel mortgage if buyer fails to pay 2 or more installments NOTE: • Nature of remedies: alternative • Coverage: sale & financing transaction & contracts of lease with option to purchase • Action : Judicial & Extrajudicial Specific Performance • If availed of, the unpaid seller cannot anymore choose other remedies; XPN: if after choosing, it has become impossible, rescission may be pursued Rescission • Deemed chosen when: a.Notice of rescission is sent b.Takes possession of subject matter of sale c. Files action for rescission Foreclosure • Actual foreclosure is necessary to bar recovery of balance • Extent of barring effect: purchase price • Exception: mortgagor refuses to deliver property to effect foreclosure; expenses incurred in attorneys fees, etc. Q: What are the remedies of the buyer? A: A. IMMOVABLES in general 1. Disturbed in possession or with reasonable grounds to fear disturbance  SUSPEND PAYMENT 2. In case of subdivision or condo projects  If real estate developer fails to comply with obligation according to approved plan: a) RESCIND b) SUSPEND PAYMENT UNTIL SELLER COMPLIES B. SALE OF IMMOVABLES ON INSTALLMENT (Maceda Law) • Coverage: Real Estate • Exclude: 1. industrial 2. commercial 3. sale to tenants under agrarian laws Q: What are the rights granted to buyers? A: 1. Buyer paid at least 2 years installment

2.

• •

Buyer paid less than 2 years installment a. Grace period is not less than 60 days from due date b. Cancellation if failure to pay w/in 60 days grace c. 30 days notice before final cancellation • buyer can still pay w/in the 30 days period • with interest Purpose of law : Protect buyers in installment against oppressive conditions Other rights: a. Sell or assign rights to another b. Reinstate contract by updating within 30 days before and cancellation c. Deed of Sale to be done by notarial act d. Pay full installment in advance the balance of price anytime w/o interest e. Have full payment annotated in certificate of title CONDITION

WARRANTY

Purports to existence of obligation must be stipulated to form part of the obligation

Purports to performance of obligation Need not be stipulated; may form part of obligation by provision of law Relates to the subject matter itself or to obligation of the seller as to the subject matter of the sale

May attach itself to obligation of seller to deliver possession & transfer

Q: What is a Condition? A: It is an uncertain event or contingency the happening of which the obligation (or right) of the contract depends. • Suspensive – gives rise to obligations • Resolutory – extinguishes obligations Q: What is a Warranty? A: a statement or representation made by the seller of goods, as part of the contract of sale, having reference to the character, quality, or title, of the goods, and by which he promises or undertakes to insure that certain facts are or shall be as he then represents. *May either be express or implied. Q: What happens in case of breach of warranty? A: Buyer may: 1. Refuse to proceed with the contract; or 2. Proceed with the contract; waive the condition. NOTE: If the condition is in the nature that it should happen, the non-performance may be treated as a breach of warranty.

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

80 2007 Team Bar-Ops Civil Law Committee

The thing sold is unfit for the use which it is intended 2. Diminishes its fitness for such use or to such an extent that the vendee would not have acquired it had he been aware thereof b. Defect is hidden c. Defect exists at the time of the sale d. Vendee gives notice of the defect to the vendor within reasonable time e. Action for rescission or reduction of the price is brought within the proper period 6 months – from delivery of the thing sold Within 40 days – from the delivery in case of animals f. There must be no waiver of warranty on the part of the vendee. 1.

Q: What are the requisites of Express Warranties? A: 1.it must be an affirmation of fact relating to the subject matter of sale 2.natural tendency is to induce buyer to purchase subject matter 3.buyer purchases the subject matter relying thereon Q: What are Implied Warranties? A: Warranties deemed included in all contracts of sale by operation of law. (Art. 1547) 1. Warranty that seller has right to sell 2. Warranty against eviction Requisites: EJ-PNS a. buyer is evicted in whole or in part from the subject matter of sale b. final judgment c. basis of eviction is a right prior to sale or act imputable to vendor d. seller has been summoned in the suit for eviction at the instance of buyer; or made 3rd party defendant through 3rd party complaint brought by buyer e. no waiver on the part of the vendee/buyer Note: For eviction – disturbance in law is required and not just trespass in fact. Q: When is Implied Warranty NOT APPLICABLE? A: (b) a. “as is and where is” sale b. sale of second hand articles c. sale by virtue of authority in fact or law d. sale at public auction for tax delinquency Liability of seller: value of thing at time of eviction (whether or not -/+ of price of sale) a. value of income of fruits b. cost of suit which caused the eviction c. expenses of contract if buyer paid for them d. damages & interests and ornamental expenses if sale was made in bad faith Q: What are the rights of buyer in case of partial eviction? A: a. rescission b. mutual restitution 3. Warranty against encumbrances (non- apparent) Requisites: a. immovable sold is encumbered with non – apparent burden or servitude not mentioned in the agreement b. nature of non – apparent servitude or burden is such that it must be presumed that the buyer would not have acquired it had he been aware thereof XPN: warranty not applicable when non – apparent burden or servitude is recorded in the Registry of Property – unless there is expressed warranty that the thing is free from all burdens & encumbrances 4. Warranty against Hidden Defects Requisites: a. Defect is important or serious

NOTE: SELLER does not warrant patent defect; Caveat emptor (Buyer Beware) NOTE: In case of Defects on Animals: • even in the case of professional inspection but hidden defect is of such nature that expert knowledge is not sufficient - defect shall be considered as REDHIBITORY • Sale is VOID if animal is: (a) Suffering from contagious diseases; Unfit for the use or service for which they were purchased as indicated in the contract. Q: What are the Specific Implied Warranties in the Sale of Goods? A: 1. Warranty of fitness GR: No implied warranty EXCEPTION: (a) buyer manifests to the seller the particular purpose for which the goods are required; and (b) buyer relies upon the seller’s skill or judgment 2. Warranty of merchantability - That goods are reasonably fit for the general purpose for which they are sold. Q: What are the Effects of Waiver? A: 1. seller in bad faith & there is waiver against eviction –void 2. when buyer w/o knowledge of a particular risk, made general renunciation of warranty – is not a waiver but merely limits liability of seller in case of eviction 3. when buyer with knowledge of risk of eviction assumed its consequences & made a waiver – vendor not liable (applicable only to waiver of warranty against eviction) NOTE: When goods are delivered to the buyer, he cannot rescind the sale: • if he knew of the breach of warranty • if he fails to return or offer to return goods to seller in substantially as good condition as they were at time ownership was transferred

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Q: What are the buyer’s options in case of Breach of Warranty? A: 1. Accept goods & set up breach of warranty by way of recoupment in diminution or extinction or the price. 2. Accept goods & maintain action against seller for damages 3. Refuse to Accept goods & maintain action against seller for damages 4. Rescind contract of sale & refuse to receive goods/return them when already received.

Q: What is Legal Redemption? A: It is the right to be subrogated upon the same terms and conditions stipulated in the contract, in the place of one who acquires the thing by purchase or by dation in payment or by other transaction whereby ownership is transmitted by onerous title.

Q: How is the contract of sale extinguished? A: Same grounds whereby obligations in general are extinguished

Q: When does period of redemption begin to run? 1. right of legal pre-emption of redemption shall be exercised within 30 days from notice by the buyer *deed of sale not to be recorded in RD unless accompanied by affidavit that buyer has given notice to redemptioners 2. when there is actual knowledge, no need to give written notice; period of redemption begins to run from actual knowledge

Q: What is Conventional Redemption ? A: seller reserved the right to repurchase thing sold coupled with obligation to return price of the sale, expenses of contract & other legitimate payments and the necessary & useful expenses made on the thing sold Q: What is the rule on the Presumption of an Equitable Mortgage? A: (Art. 1602) Note: IN CASE OF DOUBT IN DETERMINING WHETHER IT IS EQUITABLE MORTGAGE OR SALE A RETRO (WITH RIGHT OF REPURCHASE) – IT SHALL BE CONSTRUED AS EQUITABLE MORTGAGE. Q: What are the factors to be considered in determining the nature of the contract? A: 1. language of the contract 2. conduct of parties Remedy available to vendor: reformation of contract

1. 2. 3.

4.

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Q: What is the period of redemption? A: No period agreed upon – 4 years from date of contract When there is agreement – should not exceed 10 years; BUT if it exceeded, valid only for the first 10 years. When period to redeem has expired & there has been a previous suit on the nature of the contract – seller still has 30 days from final judgment on the basis that contract was a sale with pacto de retro: rationale: no redemption due to erroneous belief that it is equitable mortgage which can be extinguished by paying the loan. When period has expired & seller allowed the period of redemption to expire – seller is at fault for not having exercised his rights so should not be granted a new period Q: What is the Effect when there is No Redemption Made? A: there must be judicial order before ownership of real property is consolidated to the buyer a retro.

Q: What is Trust de son tort? A: It is a trust created by the purchase or redemption of property by one other than the person lawfully entitled to do so and in fraud of the other

Q: What are the instances when the Right of Legal Redemption is also granted? A: 1. Redemption of homesteads 2. Redemption in tax sales 3. Redemption by judgment debtor 4. Redemption in extrajudicial foreclosure 5. Redemption in judicial foreclosure of mortgage ASSIGNMENT Sale of credits & other incorporeal things ASSIGNMENT SALE Intangibles (credit, Tangibles Subject incorporeal rights) matter Consensual Consensual Form Recorded in No recording Binding needed to effect to 3rd registry of property such effect persons Q: What are the effects of Assignment? A: 1. lack of knowledge or consent of debtor not essential for validity but has legal effect 2. assignment of rights made w/o knowledge of debtor – debtor may set up against assignee the compensation w/c would pertain to him against assignor of all credits prior to assignment and later ones until he had knowledge of the assignment 3. debtor has consented to assignment – cannot set up compensation unless assignor was notified that he reserved his right to the compensation 4. debtor has knowledge but no consent compensation may still be set up NOTE: When there is an assignment of Credit or Incorporeal Right of assignor in Litigation gratuitously or onerously to the assignee, the latter

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

82 2007 Team Bar-Ops Civil Law Committee

would then be allowed to proceed against the debtor. Q: What are the rights included in assignment of credit? A: (1) guaranty; (2) mortgage; (3) pledge; (4) preference. Q: What is an indenture of assignment? A: Assignment of goods by way of security for the payment of an obligation under a promissory note.  TOP 20 PROVISIONS IN THE LAW ON SALES: Arts.1475,79,84,85,96,97,1504,05,37,44,1602,03,0 6,07,19,20,21,23,24,34.

CREDIT TRANSACTIONS Q: What do credit transactions include? A: They include all transactions involving the purchase of loan of goods, services or money extended to another either gratuitously or onerously in the present with a promise to pay or deliver in the future. Q: Who are the parties to bailment? A: 1. Bailor – the giver/lender- the party who delivers the possession or custody of the thing bailed. 2. Bailee– the recipient/ borrower- the party who receives the possession or custody of the thing thus delivered. Q: What is a Loan? A: - a contract where one of the parties delivers to another, either something not consumable so that the latter may use the same for a certain time and return it, in which case is called a commodatum; or money or other consumable things, upon the condition that the same amount of the same kind and quality shall be paid, in which case the contract is simply called a loan or mutuum CHARACTERISTICS: 1. real contract – delivery of the thing loaned is necessary for the perfection of the contract 2. unilateral contract – once subject matter is delivered, creates obligations on the part of only one of the parties (the borrower) Q: What are the kinds of Loan? A: a. Commodatum – where the bailor (lender) delivers to the bailee (borrower) a nonconsumable thing so that the latter may use it for a given time and return the same thing b. Mutuum – where the bailor (lender) delivers to the bailee (borrower) money or other consumable thing upon the condition that the latter shall pay same amount of the same kind and quality. COMMODATUM 1. Object 2. Cause

Non-consumable Gratuitous

3. Purpose

Use or temporary possession 4. Subject Real or personal Matter property 5.Ownership Retained by the bailor of thing 6. thing to Exact be thing loaned returned 7. Who bears Bailor loss 8. when to In case of urgent return need even before the expiration of term (the contract is in the meantime suspended)

Commodatum Real contract object is a nonconsumable (non fungible) thing Essentially gratuitous

Consumption Only personal property Passes to the debtor Equal amount of the same kind and quality Debtor Only after the expiration of the term

Lease Consensual Object may even be work or service. Onerous

COMMODATUM NOTES: 1. Gratuitous, otherwise it is a lease (Article 1935) 2. Purpose: temporary use of the thing loaned (Article 1935) 3. Bailee’s right to use is limited to the thing loaned and not to its fruits (Article 1935) unless there is stipulation to the contrary (Article 1940) 4. Subject matter is generally nonconsumable things but may cover consumables if the purpose of the contract is for exhibition. 5. Bailor need not to be the owner; it is sufficient that he has possessory interest over subject matter (Article 1938). 6. Commodatum is purely personal in character hence death of either bailor or bailee extinguishes the contract (Article 1939) Q: Can the bailee lend or lease the object of the contract to a third person? A: GR: No. XPN: Members of bailee’s household XPN TO THE XPN: a) There is a contrary stipulation. b) Nature of thing forbids such use. Q: What are the kinds of commodatum? A: 1. Ordinary Commodatum 2. Precarium—one whereby the bailor may demand the thing loaned at will in the ff cases: a. if neither the duration of the contract nor the use of the thing has been stipulated. b. if the use of the thing is merely tolerated by the owner

MUTUUM consumable May or may not be gratuitous

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Q: What are the obligations of the bailee? A: (SKALD) 1. pay for the ordinary expenses for the use and preservation of the thing 2. liability for loss even through fortuitous event when : a. when being able to save either of the thing borrowed or his own thing, he chose to save the latter b. he keeps it longer than the period stipulated, or after the accomplishment of its use (in default); c. the thing loaned has been delivered with appraisal of its value d. when he lends or leases it to third persons who are not members of his household e. there is deviation from the purpose NOTE: When there are two or more bailees, their liability is solidary Q: What are the obligations of the bailor? A: 1. allow the bailee the use of the thing loaned for the duration of the period stipulated or until the accomplishment of the purpose 2. refund the extraordinary expenses the bailee incurred for the preservation of the thing GR: the bailee must bring to the knowledge of the bailor such expenses before incurring the same XPN: in case of there is urgency 3. to be liable for damages for known hidden defects Q: When can the bailor be made liable for hidden defects? A: When the following requisites are present: a. there was a flaw or defect in the thing loaned b. the flaw or defect is hidden c. the bailor is aware thereof d. he does not advise the bailee of the same e. the bailee suffers damages by reason of said flaw or defect Q: Is there right of retention in commodatum? GR: No right of retention XPN: When the bailor, knowing the flaws of the thing loaned, does not advise the bailee of the same and the latter suffers damages. MUTUUM Q: What are the characteristics of contract of Mutuum? A: 1. Borrower acquires ownership of the thing. 2. If the thing loaned is money, payment must be made in the currency which is legal tender in the Philippines and in case of extraordinary deflation or inflation, the basis of payment shall be the value of the currency at the time of the creation of the obligation. 3. If fungible thing was loaned, the borrower is obliged to pay the lender another thing of the same kind, quality and quantity.

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Mutuum

Lease

the object is money or any consumable (fungible) thing

the object may be any thing, whether movable or immovable, fungible or non-fungible No transfer of ownership

There is transfer of ownership creditor and debtor relationship unilateral

Lessor-lessee relationship bilateral

Q: What is BARTER? A: It is a contract whereby one person transfers the ownership of non-fungible things to another with the obligation on the part of the latter to give things of the same kind, quantity, and quality. Q: What are the requisites for the recovery of interest? A: (ELI) 1. must be expressly stipulated 2. must be lawful 3. must be in writing NOTE: GR: Unpaid interest shall not earn interest XPNS: 1. when judicially demanded 2. when there is an express stipulation (compounded interest) DEPOSIT Q: When is the contract of DEPOSIT constituted? A: From the moment a person receives a thing belonging to another, with the obligation of safely keeping it and returning the same upon demand. Q: What are the characteristics of contract of Deposit? A: 1. real contract – perfected by the delivery of the subject matter. However, an agreement to constitute a future deposit is a consensual contract. 2. a. if gratuitous: unilateral – because only the depository has an obligation b. if for compensation: bilateral – gives rise to obligations on the part of both parties 3. principal purpose of the contract of deposit is the safekeeping of the thing delivered 4. Contract of deposit is generally gratuitous. Exceptions: a. contrary stipulation b. depository is in the business of storing goods c. property saved from destruction during calamity without owner’s knowledge, just compensation should be given the depository 5. Generally, the depositary cannot use the thing deposited except with the permission of the depositor or when the preservation of the thing requires its use but only for said purpose DEPOSIT

MUTUUM

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

84 2007 Team Bar-Ops Civil Law Committee

Purpose Safekeeping/custody Consumption When to Return Upon demand of the Upon expiration of depositor the term granted to the borrower Subject Matter Movable Money or other (extrajudicial) or fungible thing immovable (judicial) Relationship Depositor- depositary Lender- borrower Compensation No compensation of There can be things deposited with compensation of each other (except credits by mutual agreement)

Principal Purpose Nature

DEPOSIT

COMMODATUM

Safekeeping

Transfer of use

May be gratuitous or onerous

Always gratuitous

Q: What are the kinds of deposit? A: 1. Judicial (sequestration) 2. Extra-judicial a. Voluntary—the delivery is made by the will of the depositor Extinguishment: 1) Loss or destruction of thing deposited; 2) In gratuitous deposit, upon death of either depositor or depositary; 3) Other causes (return of thing, novation, expiration of the term, fulfillment of resolutory condition) b. Necessary—made in compliance with a legal obligation, or on the occasion of any calamity, or by travelers in hotels and inns, or by travelers with common carriers. JUDICIAL Creation

Purpose

Subject Matter

Will of the court Security or to ensure the right of a party to property or to recover in case of favorable judgment Movables or immovables but generally immovables

EXTRA-JUDICIAL Will of the contracting parties

Custody and safekeeping

Movables only

Cause

Always onerous

generally gratuitous but may be compensated

When must the thing be returned In whose behalf it is held

Upon order of the court or when litigation is ended

Upon demand of depositor

Person who has a right

Depositor or third person designated

NOTE: The rent of safety deposit boxes is an ordinary contract of lease of things and not a special kind of deposit because the General Banking Act as revised has deleted the part where banks are expressly authorized to accept documents or papers for safe-keeping. Q: What are the OBLIGATIONS OF DEPOSITARY in Voluntary Deposit? A: 1. to keep the thing safely and return it 2. exercise same diligence as he would exercise over his own property 3. not to deposit the thing with a 3rd person unless expressly authorized by stipulation 4. if the thing should earn interest: a. collect interest as it falls due b. take steps to preserve the value and rights corresponding to it 5. Not to commingle things if so stipulated 6. Not to make use of the thing deposited XPNS: c. When preservation of thing deposited requires its use d. When authorized by depositor 7. When the thing deposited is delivered sealed and closed: a. return the thing in the same condition b. pay damages if seal be broken through his fault c. keep the secret of the deposit when seal is broken w/ or w/o his fault HOWEVER, the depositary is authorized to open the seal or lock when: a. there is presumed authority b. out of necessity 8. Pay for any loss or damage that may arise due to his fault *Liability of loss through fortuitous event (SUDA): a. stipulated b. he uses thing w/o depositor’s permission c. he delays its return d. he allows others to use it (even if he himself is authorized to use it) 9. Return the thing deposited with all its fruits, accessions, and accessories 10. Pay interest on sums converted to personal use if the deposit consists of money Q: What are the OBLIGATIONS OF DEPOSITOR? 1. pay expenses for preservation a. gratuitous: reimburse depositary b. with compensation: expenses borne by depositary 2. pay losses incurred by depositary due to the character of the thing deposited XPNS: a. When at the time of deposit, the depositor was not aware of the dangerous character of the thing or was not expected to know it. b. when the depositor notified the depositary. c. when the depositary was aware of it without advice from the depositor Q: When is the contract of deposit extinguished?

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A: 1. If gratuitous only: upon death of either the depositor or the depositary 2. loss of the thing deposited • HOWEVER, the list is not exclusive. There may be other causes such as novation, merger, expiration of term, fulfillment of resolutory condition, etc. Q: To whom return of thing deposited be made? A: 1. To the depositor, to his heirs and successors, or to the person who may have been designated in the contract (Article 1972). 2. If the depositor was incapacitated at the time of making the deposit, to his guardian or administrator or to the depositor himself should he acquire capacity (Article 1970). 3. Even if the depositor had capacity at the time of making the deposit but he subsequently loses his capacity during the deposit, the thing must be returned to his legal representative (Article 1988). Q: Where should the thing deposited be returned? A: a. at the place agreed upon b. in the absence of stipulation: * at the place where the thing deposited might be, even if it should not be the same place where the original deposit was made provided the transfer was accomplished without malice on the part of the depositary. Q: When should the thing deposited be returned? A: General Rule: Upon demand or at will, whether or not a period has been stipulated. Exceptions: a. thing is judicially attached while in the depositary’s possession b. depositary was notified of the opposition of a third person to the return or the removal of the thing deposited (Article 1986) NECESSARY DEPOSITS DEPOSIT BY TRAVELLERS IN INNS OR HOTELS Q: When can the keepers of hotels or inns be held responsible? A: When both are present: 1. they have been previously informed by guest about the effects the latter brought in 2. the guest has taken precautions prescribed for their safekeeping NOTE: Liable regardless of the degree of care exercised when: 1. loss or injury is caused by his employees or even by strangers 2. loss is caused by act of thief or robber when there is no use of arms or irresistible force - Not liable when: 1. loss or injury is caused by force majeure

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

2. loss due to the acts of guests, his family, his employees, or visitors. 3. loss arises from the character of the goods **Hotel/Inn-keepers cannot escape or limit liability by stipulation or the posting of notices. Q: Can the keepers of the hotels or inns exercise the right of retention? A: Yes, as security for credits incident to the stay at the hotel (in the nature of a pledge created by operation of law). Q: What are aleatory contracts? A: It is one where one of the parties or both, reciprocally bind themselves to give or do something in consideration of what the other shall give or do upon the happening of an event which is uncertain, or w/c is to occur at an indeterminate time. Leonine Contract -contract in which one party gets the lion’s share to the detriment of the other Game of Chance -that which depends more on chance or hazard than on skill or ability COMPROMISES AND ARBITRATIONS Q; What cannot be compromised? A: Ci-Ma-Le Su-Ju-Le1. Civil Status of Persons 2. Validity of Marriage or Legal Separation 3. Any ground for Legal separation 4. Future Support 5. Jurisdiction of Courts 6. Future Legitime Q: What is Guaranty? A: It is a contract where a person called the Guarantor binds himself to the creditor to fulfill the obligation of the principal debtor in case the latter should fail to do so. Q: What is suretyship? A: It is a contract where a person binds himself SOLIDARILY w/ principal debtor. GUARANTY Collateral undertaking Guarantorsecondarily liable Guarantor binds himself to pay if the principal cannot pay Insurer of solvency of debtor Guarantor can avail of the benefit of excussion and division in case creditor proceeds against him

SURETYSHIP Surety is an original promissor Surety-primarily liable Surety undertakes to pay if principal does not pay Insurer of the debt Surety cannot avail of the benefit of excussion and division

Q: What are the characteristics of Guaranty and Suretyship?

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

86 2007 Team Bar-Ops Civil Law Committee

A: (ACCUNCS) 1. Accessory 2. Consensual 3. Conditional 4. Unilateral 5. Nominate 6. Cannot be presumed 7. Covered by the Statute of Frauds Note: GR: The acceptance of the creditor is not essential in such contracts. XPNS: When there is a mere offer of a guaranty or a conditional guaranty wherein the obligation does not become binding until it is accepted by the CR and notice of such acceptance is given to the guarantor. **Liberally construed in favor of GR/SR and strictly construed against the CR; the terms cannot be extended beyond its terms; however, this does not apply to compensated sureties Q: What is the benefit of Excussion? A: It is a right by which GR cannot be compelled to pay the CR unless the latter has exhausted all the properties of the principal DR and has resorted to all legal remedies against such DR. Q: When is there no benefit of excussion? A: 1. Guarantor (GR) has expressly renounced it. 2. GR has bound himself solidarily with the DR 3. DR is insolvent. 4. GR has absconded, or cannot be sued within the Philippines unless he left a manager or representative. 5. It may be presumed that an execution on the property of the DR cannot satisfy the obligation. 6. GR does not invoke the benefit against CR upon demand to him for payment and he points out available property of the DR within the Philippines sufficient to cover the obligation 7. GR is a judicial bondsman or sub-surety 8. A pledge or mortgage has been given by GR as special security. 9. GR fails to interpose it as a defense before judgment is rendered. Q: What is the principle of the Benefit of Division? A: Should there be several guarantors of only one DR for the same debt, the obligation to answer for the same is divided among all. (Joint liability) NOTE: GR: CR can claim from the GRs only up to the extent they are respectively bound to pay. XPN: When solidarity has been stipulated. • Should any of the GRs become insolvent, his share shall be borne by the other GRs including the paying

guarantor in the same joint proportion in accordance with the rule in solidary obligations • The right to be reimbursed from his co-GRs is acquired IPSO JURE by virtue of said payment • A guaranty or suretyship may secure the performance of: 1) Voidable contract; 2) Unenforceable Contract; 3) Natural obligation **The CR may proceed against GR although he has no right of action against principal DR RIGHT OF INDEMNITY AND REIMBURSEMENT General Rule: GR is entitled to be reimbursed by DR for: total amount of the debt paid legal interest from the time payment was made known to the DR expenses incurred after notifying DR demand to pay was made upon him damages in accordance with law XPNS: 1. GR is constituted w/o the knowledge OR against the will of the DR Effect: GR may only recover only so much as was beneficial to the DR 2. Payment by 3rd persons who does not intend to be reimbursed Effect: deemed a donation and as such requires the consent of DR : Payment valid as to CR who accepts it Waiver of right Q: What happens when GR pays w/o notice to the DR? A: The latter may interpose against the former defenses available to the DR as against the CR at the time payment was made. Note: GR: GR must 1st notify the DR before paying, otherwise, if the DR pays again, the GR can only collect from the CR and GR will have no cause of action against the DR even if the CR becomes insolvent. XPN: GR can claim reimbursement from DR if: CR becomes insolvent GR was prevented from notifying DR by fortuitous event EXTINGUISHMENT OF GUARANTY: 1. Principal obligation is extinguished 2. Same causes as all other obligations 3. If CR voluntarily accepts immovable or other properties in payment of the debt (even if he should afterwards lose the same through eviction or conveyance of property) 4. Release in favor of one of the GRs, w/o consent of the others, benefits all to the extent of the share of the GR to whom it has been granted 5. Extension granted to DR by CR w/o consent of GR 6. When by some act of the CR, the GRs even though they are solidarily liable cannot be subrogated to the rights, mortgages, & preferences of the former

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PLEDGE, MORTGAGE AND ANTICHRESIS Q: What are the provisions common to pledge and mortgage? 1. constituted to secure the fulfillment of a valid principal obligation 2. Pledgor or mortgagor must be the absolute owner of the thing pledged or mortgaged. 3. they must have the free disposal of their property, and in the absence thereof, that they be legally authorized for such purpose 4. Debtor retains ownership of the thing given as a security. Q: What is Pactum Commisorium? A: A stipulation whereby the thing pledged or mortgaged or subject of antichresis shall automatically become the property of the creditor in the event of non-payment of the debt within the term fixed. Such stipulation is NULL and VOID. INDIVISIBILTY GR: A pledge, mortgage or antichresis is indivisible XPNS: 1. Where each one of several things guarantees determinate portion of the credit 2. Where only a portion of the loan was released 3. Where there was failure of consideration Q: What is pledge? A: A contract where DR delivers to CR or 3 rd person a movable or document evidencing incorporeal right for the purpose of securing fulfillment of a principal obligation with the understanding that when the obligation is fulfilled, the thing delivered shall be returned w/ all its fruits & accessions. Q: What are the special requisites? A: 1. Possession of the thing pledged must be transferred to the CR or 3rd person by agreement 2. Only covers movable property and incorporeal rights evidenced by documents of title 3. Description of the thing pledged and the date must appear in a public instrument to bind 3rd persons NOTE: A contract of pledge not appearing in a public instrument does not affect its validity. KINDS: Conventional – by agreement of parties Legal – by operation of law **A thing lawfully pledged to one CR, cannot be pledged to another as long as the 1st pledge subsists. Q: When can there be a sale at public auction? A: 1. debt is due and unpaid 2. pledgor/owner is notified stating the amount due thereon 3. there is intervention of the notary public

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Q: What are the effects of sale? A:

1. extinguish the principal obligation even if the proceeds of the sale does not satisfy the whole amount of the obligation.

2. if proceeds from the sale exceed the amount due, the DR is NOT entitled to the excess unless the contrary is provided 3. if the proceeds of the sale is less than the amount due, the CR has no right to recover the deficiency Q: What is a real estate mortgage? A: It is a contract whereby the DR secures to the CR the fulfillment of the principal obligation, specially subjecting to such security immovable property or real rights over immovable property in case the principal obligation is not fulfilled at the time stipulated NOTE: • Registration is necessary to bind third persons but not for the validity of the contract. • Being an accessory contract, its consideration is one and the same as that of the principal obligation. Q: What are the special requisites? A: 1. covers only immovable property and alienable real rights imposed upon immovables 2. must appear in a public instrument 3. registration in the registry of property is necessary to bind 3rd persons Q: What is foreclosure? A: It is a remedy available to the mortgagee in which he subjects the mortgaged property to the satisfaction of the obligation. Q: What are the kinds of foreclosure? A: 1. Judicial – governed by Rule 68 of the Rules of Court 2. Extrajudicial – mortgagee is given a SPA to sell the mortgaged property (Act No. 3135) Q: Can the Mortgagee recover the deficiency? A: If there be a balance due to the mortgagee after applying the proceeds of the sale, the mortgagee is entitled to recover the deficiency. (Development Bank of the Philippines v. Mirang, 66 SCRA 141 [1975]. In judicial foreclosure, the Rules of Court specifically gives the mortgagee the right to claim for deficiency in case a deficiency exists (Section 6, Rule 70). While Act No. 3135 governing extrajudicial foreclosures of mortgage does not give a mortgagee the right to recover deficiency after the

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

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public auction sale, neither does it expressly or impliedly prohibit such recovery. Note: This right to recover deficiency had been categorically resolved in State Investment v. Court of Appeals (217 SCRA 32 [1993]). Ergo, the mortgagee is entitled to recover the deficiency in case the sale proceeds are not sufficient to cover the debt in extrajudicial foreclosures. The action to recover a deficiency after foreclosure prescribes after ten (10) years from the time the right of action accrues as provided in Article 1144(2) of the Civil Code (Development Bank of the Philippines v. Tomeldan, 101 SCRA 171 [1980]. Q: What is a stipulation of upset price? A: stipulation of minimum price at which the property shall be sold to become operative in the event of a foreclosure sale at public auction. It is NULL and VOID. Q: What is redemption? A: Transaction by which the mortgagor reacquires or buys back the property which may have passed under the mortgage or divests the property of the lien which the mortgage may have created. Q: What are the kinds of redemption? A: 1. Equity of Redemption—right of mortgagor to redeem the mortgaged property after his default in the performance of the conditions of the mortgage but before the sale of the mortgaged property or confirmation of sale. 2. Right of Redemption—right of the mortgagor to redeem the mortgaged property within one year from the date of registration of the certificate of sale. Q: What are the requisites for valid redemption? A: 1. Must be made within one year from the time of the registration of the sale. 2. Payment of the purchase price of the property plus 1% interest per month together with the taxes thereon, if any, paid by the purchaser with the same rate of interest computed from the date of registration of the sale; and 3. Written notice of the redemption must be served on the officer who made the sale and a duplicate filed with the proper Register of Deeds. (Rosales v. Yboa, 120 SCRA 869) Q: What is antichresis? A: A contract whereby the CR acquires the right to receive the fruits of an immovable of the DR, with the obligation to apply them to the payment of interest, if owing, and thereafter to the principal of his credit. Q: What are the characteristics of antichresis? A: 1. Accessory contract 2. Formal contract- the amount of the principal and of the interest must both be in writing; otherwise the contract of antichresis is void. Note:

1. Delivery of the property to the creditor is required only in order that the creditor may receive the fruits and not for the validity of the contract. 2. It is not essential that the loan should earn interest in order that it can be guaranteed with a contract of antichresis. Antichresis is susceptible of guaranteeing all kinds of obligations, pure or conditional. (Javier v. Valliser, (CA) N. 2648-R, April 29, 1950; Sta. Rosa v. Noble, 35 O.G. 27241) 3. The fruits of the immovable which is the object of the antichresis must be appraised at their actual market value at the time of the application. (see Article 2138) 4. The property delivered stands as a security for the payment of the obligation of the debtor in antichresis. Hence, the debtor cannot demand its return until the debt is totally paid. 5. A stipulation authorizing the antichretic creditor to appropriate the property upon the non-payment of the debt within the period agreed upon is void. (See Article 2038). Q: What are the special requisites? A: 1. covers only the fruits of real property 2. delivery of the property necessary so that CR may receive the fruits therefrom 3. amount of principal and interest must be specified in writing 4. express agreement that DR will give possession to the CR and that CR will apply the fruits to the interest and then to the principal NOTE: The amount of the principal and of the interest shall be specified in writing; otherwise, the contract shall be void. ANTICHRESIS 1. property is delivered to creditor 2. creditor acquires only the right to receive the fruits of the property; does not produce a real right unless registered in the REGISTRY PROPERTY 3. creditor obliged to pay the taxes and charges upon the estate unless stipulated otherwise 4. there is an express stipulation that the creditor shall apply the fruits to the payment of the interest, if owing, and thereafter to the principal of the debt.

REAL ESTATE MORTGAGE 1. debtor usually retains possession of the property 2. creditor has no right to receive fruits, but mortgage creates real right against the property 3. creditor has no such obligation 4. there is no such obligation on the part of the mortgage

ANTICHRESIS Refers to real property

PLEDGE personal property

Consensual

Real

Principal and interest must be specified in writing, otherwise

Need not be in writing, oral evidence may be allowed to

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contract is void

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

prove the same.

Q: What is chattel mortgage? A: It is a contract by virtue of w/c personal property is recorded in the Chattel Mortgage Register as a security for the performance of an obligation. Q: What are the special requisites? A: 1. GR: covers only movable property XPN: when the parties treat as personalty that which is according to its nature realty 2. Registration with the Chattel Mortgage Register 3. Description of the property. 4. Accompanied by an affidavit of good faith to bind 3rd persons • The absence of an affidavit of good faith does not affect the validity of the contract. Q: What is an affidavit of good faith? A: It is an oath in a contract of chattel mortgage wherein the parties “severally swear that the mortgage is made for the purpose of securing the obligation specified in the conditions thereof and for no other purposes and that the same is a just and valid obligation and one not entered into for the purpose of fraud.” NOTE: The absence of the affidavit vitiates the mortgage only as against third persons without notice like creditors and subsequent encumbrancers. CHATTEL MORTGAGE

PLEDGE

Delivery is not necessary Registration in the Chattel Mortgage register is necessary for its validity Procedure for the sale of the thing given as security is Sec. 14 of Act No. 1508 If the property is foreclosed, the excess goes to the debtor

Delivery is necessary Registration in the Registry Property is not necessary.

the creditor is entitled to recover the deficiency from the debtor except if the chattel mortgage is a security for the purchase of property in installments Possession remains with the DR

Art. 2112 of the Code If the property is sold, the debtor is not entitled to the excess unless otherwise agreed. The creditor is not entitled to recover the deficiency notwithstanding any stipulation to the contrary. Possession is vested in the CR

Act No. 1508 provides for the foreclosure sale in chattel mortgage be done by public auction. However, the parties are free to stipulate that the foreclosure be done by private sale GR: CR may recover deficiency XPN: when the chattel mortgage is used to secure the purchase of personal property in installments (Recto Law)

Q: What are the offenses involving Chattel Mortgage? A: 1. Knowingly removing any personal property mortgaged under the Chattel Mortgage Law to any province or city other than the one in which it was located at the time of the execution of the mortgage without the written consent of the mortgagee; and 2. Selling or pledging personal property already mortgaged, or any part thereof, under the terms of the Chattel Mortgage Law without the consent of the mortgagee written on the back of the mortgage and duly recorded in the Chattel Mortgage Register (Article 319, Revised Penal Code). Q: What may be the subject matter of Chattel Mortgage? A: 1. Shares of stock in a corporation 2. Interest in business 3. Machinery and house of mixed materials treated by parties as personal property and no innocent third person will be prejudiced thereby (Makati Leasing and Finance Corporation v. Weaver Textile Mills, Inc., 122 SCRA 296). 4. Vessels, the mortgage of which have been recorded with the Philippine Coast Guard in order to be effective as to third persons 5. Motor vehicles, the mortgage of which had been registered both with the Land Transportation Commission and the Chattel Mortgage Registry in order to affect third persons 6. House which is intended to be demolished 7. Growing crops and large cattle (section 7, paragraphs 2 and 3, Act No. 1508) Note: Section 7 of the Chattel Mortgage Law does not demand specific description of every chattel mortgaged in the deed of mortgage, but only requires that the description of the mortgaged property be such as to enable the parties to the mortgage or any other person to identify the same after a reasonable investigation and inquiry (Saldana v. Phil. Guaranty Co., Inc., 106 Phil. 919); otherwise, the mortgage is invalid. Q: How can Chattel Mortgage be foreclosed? A: 1. Public Sale 2. Private Sale – if there is an express stipulation in the contract. Exception: fraud or duress Note: 1. The mortgagee may, after thirty (30) days from the time of the default or from the time the condition is violated, cause the mortgaged property to be sold at public auction by a public officer (Section 14, Act No. 1508) 2. The 30-day period to foreclose a chattel mortgage is the minimum period after violation of the mortgage condition for the mortgage

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

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3. The creditor has least ten (10) days notice served to the mortgagor 4. The notice of time, place and purpose of such sale, is posted 5. After the sale of the chattel at public auction, the right of redemption is no longer available to the mortgagor. (Cabral v. Evangelista, 28 SCRA 1000 [1969]) CONCURRENCE AND PREFERENCE OF CREDITS The rules apply when two or more creditors have separate and distinct claims against the same debtor who has an insufficient property. Q: What are the general categories of credit? A: 1. Special preferred credits—those listed in Arts. 2241-2242 shall be considered mortgages and pledges of real and personal property or liens (Art. 2243). Hence, they are not included in the insolvent debtor’s assets. 2. Ordinary Preferred Credits-those listed in Art 2244 as amended by Art 110 of the Labor Code 3. Common credits—those listed under Art. 2245, which shall be paid pro rata regardless of dates. Liability for Obligations The debtor is liable with all his property, present and future, for the fulfillment of his obligations, subject to the exemptions provided by law. Q: What are the exempt properties? A: 1. Family home constituted jointly by husband and wife or by unmarried head of a family (Article 152, Family Code). Exceptions: a. for non-payment of taxes; b. for debts incurred prior to the constitution of the family home; c. for debts secured by mortgages on the premises before or after such constitution; d. for debts due to laborers, mechanics, architects, builders, material men and others who have rendered service or furnished material for the construction of the building 2. Right to receive support as well as any money or property obtained as such support. (Article 205, Family Code) 3. Tools and implements necessarily used by him in his trade or employment; 4. Two horses, or two cows, or two carabaos or other beasts of burden, such as the debtor may select, not exceeding one thousand pesos in value and necessarily used by him in his ordinary occupation; 5. His necessary clothing and that of all his family. 6. Household furniture and utensils necessary for housekeeping and used for that purpose by the debtor, such as the debtor may select, of a value not exceeding one thousand pesos; 7. Provisions for individual or family use insufficient for three months;

8. The professional libraries of attorney’s, judges, physicians, pharmacists, dentist, engineers, surveyors, clergymen, teachers and other professionals, not exceeding three thousand pesos in value; 9. One fishing boat and net, not exceeding the total value of one thousand pesos, the property of any fisherman, by the lawful use of which he earns a livelihood; 10. So much of the earnings of the debtor for his personal services within the month preceding the levy as are necessary for the support of his family; 11. Lettered gravestones; 12. All moneys, benefits, privileges or annuities accruing or in any manner growing out of any life insurance, if the annual premiums paid do not exceed five hundred pesos, and if they exceed the sum, a like exemption shall exist which shall bear the same proportion to the moneys, benefits privileges and annuities so accruing or growing out of such insurance that said five hundred pesos bears to the whole premiums paid; 13. Copyrights and other properties especially exempted by law (Section 12, Rule 39) 14. Property under legal custody and of the public dominion. Q: What are the preferred credits with respect to the specific movable property? A: 1. Duties, taxes and fees due thereon to the state or any subdivision thereof; 2. Claims arising from misappropriation, breach of trust, or malfeasance by public officials committed in the performance of their duties, on the movables, money or securities obtained by them; 3. Claims for the unpaid price of movable sold, on said movables, so long as they are in the possession of the debtor, up to the value of the same, and if the movable has been resold by the debtor and the price is still unpaid, the lien may be enforced on the price; this right is not lost by the immobilization of the thing by destination, provided it has not lost its form, substance and identity; neither is the right lost by the sale of the thing together with other property for a lump sum, when the price thereof can be determined proportionally; 4. Credits guaranteed with a pledge so long as the things pledged are in the hands of the creditor, or those guaranteed by a chattel mortgage upon the things mortgaged, up to the value thereof; 5. Credits for making repairs or preservation or personal property on the movable thus made, repaired, kept or possessed; 6. Claims for laborers wages, on the goods manufactured or the work done; 7. For expenses of salvage, upon the goods salvaged; 8. Credits between the landlord and the tenant arising from the contract of tenancy on shares, on the share of each in the fruits or harvest; 9. Credits for transportation, upon the goods carried, for the price of the contract and

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incidental expenses, until their delivery and for thirty days thereafter; 10. Credits for lodging and supplies usually furnished to travelers by hotelkeepers, on the movables belonging to the guest as long as such movables are in the hotel, but not for money loaned to the guests; 11. Credits for seeds and expenses for cultivation and harvest advanced to the debtor, upon the fruits harvested; 12. Credits for rent for one year, upon the personal property of the lessee existing on the immovable leased on the fruits of the same, but not on money or instruments of credit; 13. Claims in favor of the depositor if the depository has wrongfully sold the thing deposited, upon the price of the sale. NOTE: In the foregoing cases, if the movables to which the lien or preference attaches have been wrongfully taken, the creditor may demand them from any possessor within thirty (30) days from the unlawful seizures. Summary: 1. taxes 2. malversation by public officials 3. vendor’s lien 4. pledge, chattel mortgage 5. mechanic’s lien 6. laborer’s wages 7. salvage 8. tenancy 9. carrier’s lien 10. hotel’s lien 11. crop loan 12. rentals - one year 13. deposit Note: The foregoing enumeration is not an order of preference (Articles 2248 – 2249) Q: What are the Preferred Credits with respect to specific immovable property? A: 1. Taxes due upon the land or building; 2. For the unpaid price of real property sold upon the immovable sold; 3. Claims of laborers. Masons, mechanics and other workmen, as well as of architects, engineers and contractors, engaged in the construction, reconstruction or repair of buildings, canals or other works, upon said buildings, canals or other works; 4. Claims of furnishers of materials used in the construction, reconstruction, or repair of buildings, canals, and other works, upon said buildings, canals or other works; 5. Mortgage credits recorded in the Registry of Property, upon the real estate mortgage; 6. Expenses for the preservation or improvement of real property when the law authorizes reimbursement, upon the immovable preserved or improved; 7. Credits annotated in the Registry of Property, by virtue of a judicial order, by attachments or executions, upon the property affected, and only as to later credits;

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

8. Claims of co-heirs for warranty in the partition of an immovable among them, upon the real property thus divided; 9. Claims of donors or real property for pecuniary charges or other conditions imposed upon the donee, upon the immovable donated; 10. Credits of insurers, upon the property insured, for the insurance premium for two years. Summary: 1. taxes 2. vendor’s lien 3. contractor’s lien 4. lien of materialmen 5. mortgage 6. expenses of preservation 7. recorded attachments 8. warranty in partition 9. conditional donations 10. premiums for 2 year – insurers Q: What is the Order of Preference with respect to other properties of the debtor? A: 1. Proper funeral expenses for the debtor, or children under his or her parental authority who have no property of their own, when approved by the court; 2. Credits for services rendered the insolvent by employees, laborers, or household helpers for one year preceding the commencement of the proceedings in insolvency; 3. Expenses during the last illness of the debtor or of his or her spouse and children under his or her parental authority, if they have no property of their own; 4. Compensation due to the laborers of their dependents under laws providing for indemnity for damages in cases of labor accident or illness resulting from the nature of the employment; 5. Credits and advancements made to the debtor for support of himself or herself, and family, during the last preceding insolvency; 6. Support during the insolvency proceedings, and for three months thereafter; 7. Fines and civil indemnification arising from a criminal offense; 8. Legal expenses, and expenses incurred in the administration of the insolvent’s estate for the common interest of the creditors, when properly authorized and approved by the court; 9. Taxes and assessments due the national government, other those mentioned in Articles 2241, No. 1, and 2242, No. 1; 10. Taxes and assessments due any province, other than those mentioned in Articles 2241, No. 1 and 2242, No. 1; 11. Taxes and assessments due any city or municipality other than those mentioned in Articles 2241, No.1 and 2242, No. 1; 12. Damages for death or personal injuries caused by a quasi-delict; 13. Gifts due to public and private institutions of charity or beneficence;

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

92 2007 Team Bar-Ops Civil Law Committee

14. Credits which without special privilege, appear in (a) a public instrument; or (b) in the final judgment, if they have been the subject of litigation. These credits shall have preference among themselves in the order of priority of the dates of the instruments and of the judgments, respectively (Article 2244) Summary: 1. funeral expenses 2. wages of employees – one year 3. expenses of last illness 4. workmen’s compensation 5. support for one year 6. support during insolvency 7. fines in crimes 8. legal expenses - administration 9. taxes 10. tort 11. donations

Proof Needed Defense available

Preexisting contract Burden of proof

CULPA CONTRAC -TUAL

CULPA AQUILIANA

Preponderan ce of evidence Exercise of extraordinar y diligence (in contract of carriage), Force Majeure

Preponderan ce of evidence Exercise of diligence of good father of a family in the selection and supervision of employees No preexisting contract

Proof beyond reasonable doubt

Victim. Prove the ff.: 1. damage 2. negligence 3. causal connection between negligence and damage done

Prosecution. Accused is presumed innocent until the contrary is proved.

There is preexisting contract Contractual party. Prove the ff.: 1. existence of a contract 2. breach

CULPA CRIMINAL

No pre-existing contract

12. appearing in public instrument or final judgment Q: What is the Order of Preference of Credits? A: 1. Those credits which enjoy preference with respect to specific movable, excluded all others to the extent of the value of the personal property to which the preference refers (Article 2246). 2. If there are two or more credits with respect to the same specific movable property, they shall be satisfied pro-rata, after the payment of duties, taxes, and fees due the State or any subdivision thereof (Article 2247). 3. Those credits which enjoy preference in relation to specific real property or real rights, exclude all others to the extent of the value of the immovable or real right to which the preference refers (Article 8). 4. If there are two or more credits with respect to the same specific real property or real rights,

they shall be satisfied pro rata, after the payment of the taxes and assessments upon the immovable property or real right (Article 2249). 5. The excess, if any, after the payment of the credits which enjoy preference with respect to specific property, real or personal, shall be added to the free property which the debtor may have, for the payment of the other credits (Article 2250). 6. Those credits which do not enjoy any preference with respect to specific property and those which enjoy preference, as to the amount not paid, shall be satisfied according to the following rules: a. In the order established in Article 2244; b. Common credits referred to in Article 2245 shall enjoy no preference and shall be paid pro rata regardless of dated (Article 2251). QUASI-DELICT Q: What is a quasi-delict? A: Fault or negligence of a person who, by his act or omission, connected or unconnected with, but independent from, any contractual relation, causes damage to another person. (Art. 2176) Q: What are the elements of a quasi-delict? A: 1. negligent or wrongful act or omission 2. damage 3. causal relation between such negligence or fault and damage 4. no pre-existing contractual relationship between the parties (some authorities believe this element not essential) NOTE: The defense of a good father of the family is not a proper defense in culpa contractual but can mitigate the liability; the reason is that the contract is independent of the employer’s selection; therefore the selection is of no moment.

Q: What is Negligence? A: It is the failure to observe that degree of care, precaution and vigilance that the circumstances warrant. Q: What is the test of negligence? A: Would a prudent man, in the position of the tortfeasor, foresee harm to the person injured as a reasonable consequence of the course about to be pursued? If so, the law imposes a duty on the actor to take precaution against its mischievous results, and failure to do so constitutes NEGLIGENCE. (Picart v. Smith, 37 Phil 809) Q: What are the presumptions in Quasi-delict? A: 1. In motor vehicle mishaps, the owner is presumed negligent, if he was in the vehicle, though not as driver, and he could have used due diligence to prevent the misfortune (Art. 2184)

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2. It is disputably presumed that a driver was negligent if he had been found guilty of reckless driving or violating traffic regulations at least twice for the next preceding two months (Art. 2184) 3. The driver of a motor vehicle is presumed negligent if at the time of the mishap, he was violating any traffic regulation (Art. 2185) 4. Prima facie presumption of negligence of the defendant arises if death or injury results from his possession of dangerous weapons or substances (Art. 2188) XPT: when such possession or use is indispensable to his occupation or business 5. Presumption of negligence of the common carrier arises in case of loss, destruction or deterioration of the goods or in case of death or injury of passengers XPT: upon proof of exercise of extra-ordinary diligence 6. Manufacturers and processors of foodstuffs, drinks, toilet articles and similar goods shall be liable for death or injury caused by any noxious or harmful substances used (Art. 2187) Requisites: a. defendant is the manufacturer or processor of goods; b. defendant used noxious or harmful substance in the manufacture or processing of goods; c. plaintiff used or consumed such product unaware of the injurious condition of the product; d. plaintiff’s injury or death was caused by the product used or consumed; Q: What does res ipsa loquitur mean? A: the thing or transaction speaks for itself Q: What are the requisites? A: 1. the accident ordinarily does not occur in the absence of someone’s negligence 2. the instrumentality which caused the injury was under the exclusive control and management of the person charged with negligence 3. the injury suffered must not have been due to any voluntary action or contribution on the part of the person injured 4. absence of explanation by the defendant Q: What are the defenses in quasi-delict? A: PF-DDDACCLE 1. Prescription – 4 years 2. Fortuitous event 3. Due Diligence 4. Damnum Absque Injuria – the law affords no remedy for damages resulting from an act which does not amount to a legal injury or wrong; the consequences must be borne by the injured person alone. 5. Assumption of Risk Volenti non fit injuria – one is not legally injured if he has consented to the act complained of or was willing that it should occur

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

Requisites: a. the plaintiff must know that the risk is present b. he must further understand its nature c. his choice to incur is free and voluntary (XPT: if an emergency is found to exist, or if the life or property of another is in peril or when he seeks to rescue his endangered property) 6. Contributory Negligence – conduct on the part of the injured party contributing to the harm he has suffered which falls below the standard to which he is required to conform for his own protection • results in the mitigation of liability of the defendant 7. Concurrent Negligence – both parties are equally negligent; the courts will leave them as they are and there can be no recovery 9. Doctrine of Last Clear Chance or Discovered Peril- The contributory negligence of the party injured will not defeat the claim for damages if it is shown that the defendant could, by the exercise of reasonable care and prudence have avoided the consequences of the negligence of the injured party. In case of collision, it applies in a suit between the owners and drivers of colliding vehicles and not where a passenger demands responsibility from the carrier to enforce its contractual obligations. Requisites: a. Both plaintiff and defendant were negligent. (This is an XPN to concurrent negligence rule) b. Plaintiff was in a position of danger by his own negligence. c. Defendant knew of such position of the plaintiff. d. Defendant had the least clear chance to avoid the accident by exercise of ordinary care but failed to exercise such last clear chance. e. Accident occurred as proximate cause of such failure. 10. Emergency Rule or Sudden Peril Doctrine Where one suddenly finds himself in a place of danger and is required to act without time to consider the best means that may be adopted to avoid the impending danger, he is not guilty of negligence if he fails to adopt what subsequently and upon reflection may appear to have been a better method unless the emergency in which he finds himself is brought about by his own negligence. • Defendant must not be guilty of Applicable only to situations that are sudden and unexpected such as to deprive actor of all opportunity for deliberation

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

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• But action must still be judged by the standard of the ordinary prudent man • Absence of forseeability. Q: Differentiate Proximate from Remote Cause A: Proximate Cause is that cause which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the injury and without which the result would not have occurred. Remote Cause is the cause that contributes to, but is not necessary for, the production of an effect or result. Q: What are the tests to determine whether a cause is proximate or not? A: a. Cause-in-fact Test • it is necessary that there is proof that defendant’s conduct is a factor in causing plaintiff’s damage • determines whether the defendant’s act or omission is a causally relevant factor 1. But for test/ sine qua non test • Defendant’s conduct is the cause in fact of the injury if the damage would not have resulted had there been no negligence on the part of the defendant. 2. Substantial Factor Test • It makes the negligent conduct the cause-in- fact of the damage if it was a substantial factor in producing the injuries. • important in cases where there are concurrent causes 3. Necessary and Sufficient Test (NESS) • the act or omission is a cause-infact if it is a necessary element of a sufficient set b. Policy test • The law may limit the liability of the defendant to certain consequences of his action; if the damage or injury to the plaintiff is beyond the limit of the liability fixed by law, the defendant’s conduct cannot be considered the proximate cause. • determines such limit of liability 1. Forseeability Test 2. Natural and Probable Consequence Test 3. Natural and Ordinary or Direct Consequences Test 4. Hindsight Test 5. Orbit of Risk Test 6. Substantial Factor Test Q: What is the principle of concurrent cause? A: Where the concurrent or successive negligent acts or omissions of two or more persons, although acting independently, are in combination the direct and proximate cause of a single injury to a 3rd person, and it is impossible to determine what proportion each contributed to the injury, either of them is responsible for the whole injury, even though his act alone might not have caused the entire injury.

Q: What is the doctrine of attractive nuisance? A: One who maintains on his premises dangerous instrumentalities or appliances of a character likely to attract children in play, and who fails to exercise ordinary care to prevent children from playing therewith or resorting thereto, is liable to a child of tender years who is injured thereby, even if the child is technically a trespasser in the premises. Requisites: 1. Possessor knows or has reason to know that children are likely to trespass to the place. 2. Possessor knows or has reason to know or should realize that it will produce unreasonable risk of death or serious bodily harm to such children. 3. The children because of their youth realize the risk involved in meddling with it or in coming within the area made dangerously by it. 4. The possessor fails to exercise reasonable care to eliminate the danger or otherwise to protect the children. Q: What is the principle of vicarious liability? A: A person is not only liable for torts committed by him, but also for torts committed by others with whom he has a certain relation or for whom he is responsible ARTICLE 2180 – liability for act or omissions of those persons for whom one is responsible (FGOESS): 1. Father, or in case of death or incapacity, mother a. damage caused by minor children b. living in their company 2. Guardian a. for minors or incapacitated persons b. under their authority c. living in their company 3. Owners and managers of establishments a. for their employees b. in the service of the branches in which they are employed, or; c. on the occasion of their functions 4. Employers a. damages caused by employees and household helpers b. acting within the scope of their assigned tasks c. even if the employer is not engaged in any business or industry 5. State – acting through a special agent and not when the damage has been caused by the official to whom the task done properly pertains. Q: Who is a special agent? A: Special Agent is one who receives a definite and fixed order or commission, foreign to the exercise of the duties of his office An employee who on his own responsibility performs functions inherent in his office and naturally pertaining thereto is not a special agent

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6. Art 218, Family Code – The school, its administrators and teachers, or the individual, entity or institution engaged in child care shall have special parental authority and responsibility over the minor child while under their supervision, instruction or custody. NOTE: Authority and responsibility shall apply to all authorized activities whether inside or outside the premises of the school, entity or institution Art 219, Family Code – Those given authority and responsibility under the preceding Article shall be principally and solidarily liable for damages caused by the acts or omissions of the unemancipated minor. The parents, judicial guardians or the persons exercising substitute parental authority over said minor shall be subsidiarily liable. The respective liabilities shall not apply if it is proved that they exercised proper diligence required under the particular circumstances Difference between Articles 218 of the FC & 2180 NCC 218 2180

School, admin, teachers engaged in child care are made expressly liable

Teachers, head of establishment in Arts and trades are made expressly liable

Liability of school, admin, teachers is solidary and parents are made subsidiary liable

No such express solidary nor subsidiary liability is stated

Students involved must be minor

Students involved necessarily minor

not

Q: Can you impute liability to teacher-in-charge even if the student is already of majority age? A: Yes. Under Article 2180, age is not important. Q: Does Article 2180 apply to school of arts & trades only? A: No. applies to all including academic institution per weight of jurisprudence based on obiter of Justice JBL Reyes in the Exconde case. Q: Distinguish Par. 4 (owners & managers) and Par. 5 (employers) of Article 2180 A: Par 4 Par 5 (owners & managers) (employers) apply to employers

apply to employers

owners and managers of

employers

an establishment enterprise

or

whether or not engaged in any business or industry

employers must engaged in business the law speaks “establishment enterprise”

be as of or

employers referred to need not be engaged in business or industry

refers to negligent acts of employees committed either in the service of the branches or on the occasion of their functions

encompasses negligent acts of employees acting within the scope of their assigned task

Q: Who are the persons made liable by law even w/o fault? A: 1. Possessor of an animal or whoever may make use of the same, although it may escape or be lost XPT: when the damage should come from a.force majeure, or b. fault of the person who has suffered the damage 2. Owner of motor vehicle, in motor vehicle mishaps, such owner is solidarily liable with his driver if: a. he was in the vehicle, and b. could have prevented the misfortune by the use of due diligence 3. Manufacturers and processors of foodstuffs, drinks, toilet articles and similar goods, are liable for death or injuries cause by any noxious or harmful substances used, although no contractual relation exists between them and the consumers 4. Defendant in possession of dangerous weapons or substances, such as firearms and poison, there is a prima facie presumption of negligence on the part of the defendant if the death or injury results from such possession XPT: when the possession or use thereof is indispensable in his occupation or business 5. Provinces, cities and municipalities, liable for damages for the death of, or injuries suffered by, any person by reason of the defective condition of roads, streets, bridges, public buildings, and other public works under their control and supervision 6. Proprietor of a building or structure, responsible for the damages resulting from: a. its total or partial collapse, if it should be due to the lack of necessary repairs b. the explosion of machinery which has not been taken care of with due diligence, and the inflammation of explosive substances which have not been kept in a safe and adequate place

in general,

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

96 2007 Team Bar-Ops Civil Law Committee

7.

8.

c. excessive smoke, which may be harmful to persons or property d. the falling of trees situated at or near highways or lanes, if not caused by force majeure e. emanations from tubes, canals, sewers or deposits of infectious matter, constructed without precautions suitable to the place Engineer, architect or contractor, if the damage in the building or structure should be the result of any defect in the construction which happens within 15 years from construction Head of the family that lives in a building or part thereof, responsible for damages cause by things thrown or falling from the same

NOTE: In motor vehicle mishaps, the owner is solidarily liable with his driver, if the former, who was in the vehicle, could have, by the use of the due diligence, prevented the misfortune. It is disputably presumed that a driver was negligent, if he had been found guilty or reckless driving or violating traffic regulations at least twice within the next preceding two months. If the owner was not in the motor vehicle, the provisions of Article 2180 are applicable. (Article 2184) Q: What is the liability of the owner? A: If car owner is present in the car sue under Article 2184

If car owner is not present in the car sue under Article 2180

solidary liability with the driver

imputed liability

once the driver is proven negligent in causing the damage, the law presumes the vehicle owner equally negligent and imposes upon him the burden of proving proper selection of employee as a defense

defense of having exercised all the diligence of a good father of a family is available to the car owner

Quasi-Delict Affects only private interests Civil Code, by indemnification merely repairs damages incurred Included all acts w/ any kind of fault or negligence

Criminal Offense Affects public interests RPC punishes/corrects criminal acts Crimes punished only if there is a law clearly covering it

HUMAN RELATIONS Art 19, 20, 21 (catch-fall provision) Q: What is the Principle of Abuse of Rights? A: Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith. (Art. 19, NCC) Elements:

a. Legal right or duty b. The right or duty is exercised in bad faith, and c. For the sole intent of prejudicing or injuring another Q: Differentiate Article 20 from Article 21 of the Civil Code. A: Article 20 speaks of the general sanction for all other provisions of law which do not especially provide for their own sanction. Article 21 on the other hand, speaks of act w/c is legal but is contrary to morals, good custom, public order or public policy and is done with intent to injure Q: What are the other provisions in Human relations? A: a. Violation of Right of Privacy, Family Relations, Vexation and Humiliation (Art. 26, NCC) b. Dereliction of Official Duty of Public Officers (Art. 27, NCC) Requisites: *defendant is a public officer charged with the performance of a duty in favor of the plaintiff *he refused or neglected without just cause to perform such duty (ministerial) *plaintiff sustained material or moral loss as consequence of such non-performance *the amount of such damages, if material c. Violation of Rights and Liberties of Another Person (Art. 32, NCC) d. Defamation, Fraud and Physical Injuries (Art. 33, NCC) e. Neglect of Duty by Police Officers (Art. 34, NCC) Q: What is unfair competiton? A: It consists in employing deception or any other means contrary to good faith by which any person shall pass of the goods manufacture by him or in which he deals, or his business or services for those of the one having established goodwill or committing any acts calculated to produce such result. (Par 2, Sec 29 RA 166) Q: What is the true test of unfair competition? A: Whether certain goods have been intentionally clothed with an appearance which is likely to deceive the ordinary purchaser exercising ordinary care and not whether a certain limited class of purchases with special knowledge not possessed by the ordinary purchaser could avoid mistake by the exercise of this special knowledge. Q: What is the reason behind Article 28? A: It is necessary in a system of free enterprise. Democracy becomes a veritable mockery if any person or group of persons by any unjust or highhanded method may deprive others of a fair chance to engage in business or earn a living. Q: When is there Malicious Prosecution? A: When a criminal prosecution, civil suit, or other legal proceedings has been instituted maliciously

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and without probable cause, action for damages maybe brought by one against another, after the termination of such prosecution, suit or proceeding.

another, it does not mean that the latter is exempted from indemnifying the former. The liability will lie on quasi-contract under Article 2146.

Elements: a. The fact of the prosecution and the fact that the defendant was himself the prosecutor, and that the action was finally terminated with an acquittal b. That in bringing the action, the prosecutor acted without probable cause c. The prosecutor was actuated or impelled by legal malice

Q: Is the article applicable to the government? A: Yes. The government cannot enrich itself at the expense of another.

UNJUST ENRICHMENT / ACTION REM VERSO Arts. 22, 23, 2142 & 2143 Every person who through an act of performance by another, or any other means, acquires or comes into possession of something at the expense of the latter without just or legal ground, shall return the same to him. (Article 22) Even when an act or event causing damage another's property was not due to the fault negligence of the defendant, the latter shall liable for indemnity if through the act or event was benefited. (Article 23)

to or be he

Certain lawful, voluntary and unilateral acts give rise to the juridical relation of quasi-contract to the end that no one shall be unjustly enriched or benefited at the expense of another. (Article 2142) The provisions for quasi-contracts in this Chapter do not exclude other quasi-contracts which may come within the purview of the preceding article. (Article 2143) Q: Distinguish Accion In Rem Verso from Solutio Indebiti A: Accion Rem Verso Solutio Indebiti It is not necessary that Payment by mistake payment be made by is an essential mistake element Q: What are the requisites for Accion Rem Verso? A: 1. that the defendant has been enriched; 2. that the plaintiff has suffered a loss; 3. that the enrichment of the defendant is without just or legal ground 4. that the plaintiff has no other action based on contract, quasi-contract, crime or quasi-delict Q: What is the limitation of accion rem verso? A: It can only be availed of if there is no other remedy to enforce it based on contract, quasicontract, crime or quasi-delict Q: Is rendition of services included in the article? A: No. Services are not included in the Article. If services were rendered by someone benefiting

PREJUDICIAL QUESTION Q: What is a prejudicial question? A: It is one based on a fact distinct and separate from the crime but so intimately connected with it that it determines the guilt or innocence of the accused; and for it to suspend the criminal action, it must appear not only that said case involve facts intimately related to those upon which the criminal prosecution would be based but also that in the resolution of the issue or issue raised in the civil case, the guilt or innocence of the accused would be necessarily determined. Q: What is the justification for Article 36? A: For purposes of orderly administration of justice and to avoid the rendition of possible conflicting decisions of two courts on the same issue. Q: Is the principle applicable even if only one court is involved? A: Yes. In such case, the court when exercising jurisdiction over the civil action is considered distinct and different from itself when trying the criminal action. Q: What are the elements of prejudicial question? A: The elements of a prejudicial question are: (a) the previously instituted civil action involves an issue similar or intimately related to the issue raised in the subsequent criminal action, and (b) the resolution of such issue determines whether or not the criminal action may proceed. Q: What is the additional requisite? A: That the civil action must be filed ahead of the criminal action Q: What is the test to determine that existence of a prejudicial question? A: To determine the existence of a prejudicial question, it must appear that the civil case does not only involve the same facts upon which the criminal prosecution is based but also that the resolution of the issues raised in said civil action would necessarily be determinative of the guilt or innocence of the accused. Q: Is the principle of prejudicial question applicable in administrative cases? Can there be a prejudicial question even if does not involve a civil action and a criminal action? A: Yes. DAMAGES Q: What is damage?

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

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(i) actions for indemnity under workmen's compensation and employer liability laws (j) when double judicial costs are awarded (k) separate civil action to recover civil liability arising from crime

A: The detriment, injury, or loss, which is occasioned by reason of fault of another in the property or person. Q: What are damages? A: The pecuniary compensation, recompense or satisfaction for an injury sustained or as otherwise expressed, the pecuniary consequences which the law imposes for the breach of some duty or violation of some rights Q: What are the kinds of damages? A: (MENTAL) Moral Exemplary Nominal Temperate Actual Liquidated 1. ACTUAL\ COMPENSATORY (Art. 2199) • comprehends not only the value of the loss suffered but also that of the profits which the obligee failed to obtain • the amount should be that which would put the plaintiff in the same position as he would have been if he had not sustained the wrong for which he is now getting compensation or reparation • to recover damages, the amount of loss must not only be capable of proof but must actually be proven Q: What is the coverage of Actual Damages? A: (a) Dano emergente – loss of what a person already possesses (b) Lucro cessante – failure to receive as a benefit that would have pertained to him • loss or impairment of earning capacity in cases of temporary or permanent personal injury • injury to the plaintiff’s business standing or commercial credit

Q: What is the Doctrine of Avoidable Consequences? A: A party cannot recover damages flowing from consequences which the party could reasonably have avoided. Q: Can one who is injured by a wrongful attachment recover damages for actual loss resulting therefrom? A: Yes, but the Supreme Court established the following rules in Philippine Commercial International Bank v. Intermediate Appellate Court (G.R. No. 73610, April 19, 1991) 1. The recovery of actual damages is limited to compensation for injuries which are the direct and proximate result of the wrongful attachment; 2. The items recoverable are limited to those which flow naturally and reasonably therefrom; 3. One who has been injured by a wrongful attachment can recover damages for the actual loss resulting therefrom. For such loss to be recoverable, they must constitute actual damages established by competent court. In the same case, it was also held that the impairment of plaintiffs credit, his inability to sell the land levied upon, or to contract a loan upon the security of the land are not the proximate, but remote consequence of the attachment. Actual CONCEPT An adequate compensation only for such pecuniary loss suffered by him as he has duly proved

Attorney’s Fees are actual damages that are due to the plaintiff and not to the counsel. Q: Are attorney’s fees recoverable? A: GR: NOT recoverable. XPNs: sec-murs-wids (a) stipulation between parties (b) when exemplary damages are awarded (c) when defendant's act or omission compelled plaintiff to litigate with 3rd persons or incur expenses to protect his interest (d) malicious prosecution (e) clearly unfounded civil action or proceeding against plaintiff (f) defendant acted in gross & evident bad faith in refusing to satisfy plaintiff's just & demandable claim (g) legal support actions (h) recovery of wages of household helpers, laborers & skilled workers

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PROOF

AMOUNT

It is necessary that the claimant produces competent proof or the best evidence obtainable such as receipts to justify an award therefore. Actual or compensatory damages cannot be presumed but must be proved with reasonable certainty (Pp v. Ereno Feb. 22, 2000)

Property – value at the time of destruction, or market value, plus, in proper cases, damages for the loss of use during the period before replacement, value of use of premises, in case of mere deprivation of possession.

Any person who seeks to be awarded actual or compensatory damages due to acts of another has the burden of proving said damages as well as the amount thereof. Actual damages cannot be allowed unless supported by evidence on the record. The court cannot rely on speculations, conjectures or

Personal injury – Medical expenses; P 75,000 by way of civil indemnity in case of rape committed or effectively qualified under which the

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guesswork as to the fact and amount of damages (Banas, Jr. v. CA, Feb. 10, 2000)

death penalty is imposed by law, or P 50,000 in other rape cases. Death – Wake and burial expenses, P 50,000 by way of civil indemnity ex delicto which requires no proof other than the fact of death of the victim and the assailant’s responsibility therefor.

pecuniary estimation, it may be recovered if they are the proximate result of the defendant’s wrongful act or omission (Art. 2217, NCC)

• Requisites: a. There must be an injury whether physical; mental or psychological, clearly sustained by the claimant b. There must be culpable act or omission c. Such act or omission is the proximate cause of the injury. d. The damage is predicated on the cases cited in Art. 2219 Moral Damages CONCEPT

PROOF

AMOUNT

Include physical suffering, mental anguish, fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation and similar injury. Though incapable of

No proof of pecuniary loss is necessary. The assessment is left to the discretion of the court according to the circumstances of each case. However, there must be proof that the defendant caused physical suffering etc. (Compania Maritima v. Allied

No hard and fast rule in determining the amount. But sentimental value of the property, extent of humiliation, pain and suffering, official, political, social and financial standing of the

Aside from the fact that there is a need for the claimant to satisfactorily prove the existence of the factual basis of the damages, it is also necessary to prove its causal relation to the defendant’s act (Raagas v. Trava, 22 SCRA 839, Pp v. Manero, Jan. 29, 1993).

offended party and the business and financial position of the offender may be considered and affect the amount of damages; P 50,000 in case of rape or for each count of rape in case of multiple rape or death.

The exception to the general rule that factual basis must be alleged are criminal cases. Moral damages may be awarded to the victim in criminal proceedings in such amount as the court deems just without the need for pleading or proof of the basis thereof (Pp v. Prades, July 30, 1998).

1. MORAL (Art.2217) Q: Why are moral damages awarded? A: They are awarded to enable the injured party to obtain means, diversions or amusement that will serve to alleviate the moral suffering he has undergone by reason of the defendant’s culpable action. Q: How can the plaintiff recover moral damages? A: The plaintiff must allege and prove: a. The factual basis for moral damages and b. The causal relation to the defendant’s act • XPN: Moral damages may be awarded to the victim in criminal proceedings without the need for pleading of proof or the basis thereof

Free Worker’s Union, 77 SCRA 24).

Q: What are the factors in determining the amount of moral damages? A: 1. Political, social, financial standing of offended party and offender 2. Mental anguish Example: Compare the mental anguish of two mothers whose sons died in two different incidents. One son was shot to death, and he died instantly. The other son was partying at Ozone when it burned down. He suffered for several weeks with painful burns before he finally died. The mental suffering of the Ozone victim's mother is greater than that of the mother of the son who was shot to death, since the former had to watch as her son had to withstand the agony of the burns. 3. Sentimental value Example: Two ring- one with a huge stone that you won at a raffle and another with a tiny stone that was given to you by your one true love. Of course, the sentimental value of the second ring is greater. 3.

NOMINAL ( Art. 2221)

Q: What is the purpose of nominal damages? A: In order that a right of the plaintiff which has been violated or invaded by the defendant may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.

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100 2007 Team Bar-Ops Civil Law Committee

• •

These are small sums fixed by the court without regard to the extent of the harm done to the injured party They are damages in name only and are allowed simply in recognition of a technical injury based on a violation of a legal right

NOTE: Nominal cannot co-exist with actual or compensatory damages because nominal damages are recoverable when the damages suffered cannot be proved with reasonable certainty. Nominal CONCEPT PROOF AMOUNT Adjudicated in order that a right which has been violated or invaded by the defendant, may be vindicated or recognized, and not for the purpose of indemnifying the plaintiff for any loss suffered by him.

No proof of pecuniary loss is necessary. Proof that a legal right has been violated is what is only required. Usually awarded in the absence of proof of actual damages.

Left to the discretion of the court according to the circumstanc es of each case.

4. TEMPERATE\ MODERATE (Art. 2224) Q: What are temperate damages? A: Those damages, which are more than nominal but less than compensatory, and may be recovered when the court finds that some pecuniary loss has been suffered but its amount cannot be proved with certainty. •

In cases where the resulting injury might be continuing and possible future complications directly arising from the injury while certain to occur are difficult to predict, temperate damages can and should be awarded on top of actual or compensatory damages in such cases there is no incompatibility between actual and temperate damages

5. LIQUIDATED (Art. 2226) Q: What are liquidated damages? A: Those agreed upon by the parties in a contract, to be paid in case of breach thereof • It may be equitably reduced when: a. iniquitous or unconscionable b. partial or irregular performance Liquidated CONCEPT Those agreed upon by the parties to a contract, to be paid in case of breach thereof, may be intended as an indemnity or a penalty.

PROOF

AMOUNT

If intended as a penalty in obligations with a penal cause, proof of actual damages suffered by the creditor is not necessary in order that the penalty may be demanded (Art. 1228, NCC). No proof of pecuniary loss is necessary.

That stipulated or agreed by the parties. However, whether it is intended as an indemnity or a penalty, it shall be equitably reduced if they are iniquitous or unconscionable; when the breach of contract committed by the defendant is not the one contemplated by the parties in agreeing upon the

liquidated damages, the law shall determine the measure and not the stipulation.

6. EXEMPLARY (Art. 2229) Q: What is the purpose of exemplary damages? A: Imposed by way of example or correction for the public good, in addition to the moral, temperate, liquidated or compensatory damages - Intended to serve as a deterrent to serious wrong doings and as a vindication of undue sufferings and wanton of invasion of the rights of an injured or a punishment for those guilty of outrageous conduct Q: What are the requisites before exemplary damages can be recovered? A: a. the claimant’s right to them has been established b. their determination depends upon the amount of compensatory damages that may be awarded to the claimant c. The act must be accompanied by bad faith or done in wanton, fraudulent, oppressive or malevolent manner. Exemplary CONCEPT Imposed by way of example or correction for the public good, in addition to the moral, temperate, liquidated or compensator y damages.

PROOF

AMOUNT

1. That the claimant is entitled to moral, temperate or compensatory damages; and

Left to the discretion of the court according to the 2. That the crime was circumstanc committed with 1 or more es of each aggravating circumstances, case; P or the quasi-delict act was 30,000 in committed with gross case of negligence, or in contracts homicide and quasi-contracts the act committed must be accompanied by with abuse done in wanton, AMOUNT of superior CONCEPTbad faith orPROOF More than fraudulent, May beoppressive recovered or Leftstrength. to the manner. nominal but malevolent when the court finds discretion of less than that some pecuniary the court of pecuniary loss is according to compensatoryNo proof loss has been damages. necessary. suffered but its the amount cannot from circumstances the nature of the case of each case. be proved with certainty. No proof of pecuniary loss is necessary.

Q: What are the damages that can be recovered in case of death? A: MEA-IN M-oral damages E-xemplary damages A-ttomey's fees and expenses for litigation IN-demnity for death IN-demnity for loss of earning capacity IN-terest in proper cases Q: What are the factors to be considered to determine the damages in case of death? A: 1. Loss of the earning capacity of the deceased.

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2. The earning capacity of the deceased, his obligation to support dependents, and the moral damages suffered by his kin are also considered. This is predicated on the reason that the life of a great and skilled professional, be he a lawyer, doctor, engineer, scientist, a statesman, journalist, writer, economist, banker, etc., is certainly more valuable not only to their families but also to their particular community and to the country in general. 3. If the financial capacity of the carrier enables it to pay more, a greater sum should be given. {People v. Mongaya, L-23708, October 31, 1968] 4. Life expectancy of the deceased. {PAL v. CA, G.R. No. 544701, May 8, 1990} 5. The rate of inflation that depleted the value of the judgment was considered in imposing legal rate of interest on the indemnity due the deceased. Q. What are the damages recoverable in crimes and quasi-delicts? A. Defendant is liable for damages that are natural and probable consequence of the act/omission complained of and not necessary that damages have been foreseen or could have been foreseen. VALUE OF LOSS SUFFERED Destruction of things, fines, penalties, medical and hospital bills, attorney’s fees, interest, and cost of litigation Loss or impairment of earning capacity in case of physical disability  Unless deceased had permanent physical disability not caused by defendant so that deceased had no earning capacity at the time of death Damages for support are recoverable if deceased was obliged to give support for period not more than 5 years. Attorney’s fees – as a general rule, are not recoverable, unless provided by law and stipulation.   

Attorney’s fees must be alleged, prayed for and proven. Article 2208 refers to extraordinary attorney’s fees. Ordinary attorney’s fees - the client agreed to pay his lawyer. The client must pay even no stipulation: based on the amount of work performed.

LOSS OF EARNING CAPACITY Formula: Loss of Earning Capacity = LE x NI LE (Life expectancy) = (80 – age) multiply by 2/3

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

NI (Net Income) = Gross Annual Income – Living Expenses Note: When there is no showing that the living expenses constituted a smaller percentage of the gross income, the living expenses is fixed at half of the gross income. Gross Annual Income = Monthly Income x 12 Example: The victim was in a perfect health at the age of 44 when he was killed by the accused. He was receiving P16,000 a month. There was no evidence of living expenses presented by the victim heirs or the accused. Gross Annual Income P 16,000 x 12 = P 192,000 Net Income P 192,000 – P 96,000 = P 96,000 Note: In absence of evidence, living expenses presumed to be half of the gross annual income

is

For simplicity, just divide gross annual income by two (2) Life Expectancy (80 – 44) multiply by 2/3 = 24 Loss of Earning Capacity P 96,000 x 24 = P 2,304,000 Wherefore, the accused is liable to pay the heirs of the victim the amount of P 2,304,000 representing the loss of earning capacity *The formula is not only applicable in cases where the victim dies. It also applies in cases where the victim was permanently incapacitated to work.

LAND TITLES AND DEEDS Q: What are the modes of Acquiring Land Titles? A: (PERA PAID) 1. Public Grant 2. Emancipation patent or grant 3. Reclamation 4. Adverse Possession 5. Private Grant or Voluntary Transfer 6. Accretion 7. Involuntary Alienation 8. Descent or Devise Q: What is Torrens Title? A: It is a certificate of ownership issued under the Torrens system of registration by the government, through the Register of Deeds (RD) naming and declaring the owner in fee simple of the real

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

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property described therein, free from all liens & encumbrances except as may be expressly noted there or otherwise reserved by law • Conclusive against the whole world (including the government) & to a holder thereof in good faith, it is guaranteed to be indefeasible, unassailable & imprescriptible.

registration contemplated under said Act refers only to ownership of land. The owner of the building should file an opposition or answer to the application for registration and ask the court that his right to the building be annotated ion the decree and later in the certificate of title.

**Decisions in land registration proceedings become final after the expiration of 30 days from date of service of its notice. Decree of Registration becomes final after lapse of 1 year from date of its issuance & entry. Decree becomes incontrovertible and unassailable.

Probative Value of Torrens Title (TT) – TT may be received in evidence in all courts of the Philippines and shall be conclusive as to all matters contained therein, principally as to the identity of the land owner except so far as provided in the Land Registration Act (LRA)

NOTE: GR: A title once registered cannot be defeated by prescription. XPN: subject to the right of a third person on the equitable principle of laches.

Original Registration Proceeding – brought before the RTC (land registration court) to determine title or ownership of land on the basis of an application for registration or answer by a claimant in a cadastral registration

Q: What is laches? A: It is the failure or neglect for an unreasonable and unexplained length of time to assert a right warranting a presumption that the party entitled to it has either abandoned it or declined to assert it.

Subsequent Registration Proceeding – where incidental matters after original registration may be brought before the land registration court by way of motion or petition filed by the registered owner or party in interest

Q: What are the requisites for the Amendment or Correction of title? A: 1) It must be filed in the original case 2) By the registered owner or a person in interest 3) On grounds enumerated 4) All parties must be notified 5) There is unanimity among them 6) Original decree must not be opened Q: What are the grounds for amendment or correction of title? A: 1) An error or omission was made thereon 2) A registered interest is terminated 3) New rights have arisen which do not appear in the certificate 4) Change of name or status of a person 5) Any reasonable ground Q: What are the Grounds for Cancellation of Title? A: 1) When title is void 2) Title is replaced by one issued under a cadastral proceeding 3) When condition for its issuance has been violated by the registered owner. Q: May the owner of a building constructed on an unregistered land belonging to another apply for the registration of such building under the Land Registration act and PD 1529? What should he do to protect his rights in case the owner of the land applied for registration thereof? A: The Land Registration Act and PD 1529 apply to registration of land only. It may include the building as an accessory but the building cannot be registered independently of the land because of the

Q: What are the Steps in Land Registration Proceedings? A: (SF-STPS-FHPIEST) 1. Survey of land by Bureau of Lands or duly licensed private surveyor 2. Filing of application for registration by applicant • Application shall be filed with the RTC of the province or city where the land is situated. • Application may include two or more parcels of land as long as they are situated within the same province or city. • The court may at anytime order an application to be amended by striking out one or more parcels or by severance of the application • If amendment includes a parcel of land not previously included in the application as published, a new publication of the amended application must be made. • Without such publication, registration court cannot acquire jurisdiction over the area that is added. • RTC acting as a land registration court has a limited jurisdiction but it is deemed to have all the necessary powers to exercise such jurisdiction to make it effective: a. it can determine whether an instrument is a true deed of sale or a mere equitable mortgage b. it can determine the issue on the genuineness of a document. •

MeTC, MCTC, and MTC may be assigned by the SC to decide cadastral and land registration cases: a. when there is no controversy or opposition b. Value of contested lots do not exceed P20,000.00 3. Setting of date for initial hearing by the court.

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4. Transmittal of application and date of initial hearing together w/ all documents or other pieces of evidence attached thereto by clerk of court to National Land Titles and Deeds Registration Administration (NALDTRA) 5. Publication of notice of filing of application and date and place of hearing once in O.G & once in newspaper of gen. circulation in the Phils. 6. Service of notice by sheriff upon contiguous owners, occupants & those known to have interest in the property. 7. Filing of answer or opposition to application by any person whether named in the notice or not • A private person may not oppose an application for registration on the ground that the land applied is a property of the government. General default Issued by the court when no person appears and files opposition to the application within the period prescribed on the notice of initial hearing Operates against all persons in general.

Order of Special default Issued when some persons appear and file oppositions thereto.

Only against those particular persons who did not appear nor oppose.

8. Hearing of case by court. 9. Promulgation of judgment by court. Q: What is a writ of possession? A: It is an order issued by the RTC directing the sheriff to place the successful litigant in possession of the property. NOTE: • It may be issued only pursuant to a decree of registration in an original land registration proceeding “not only against the person who has been defeated in the case but against anyone adversely occupying the land or any portion thereof during the proceedings up to the issuance of the decree. (Lucero v. Loot 25 SCRA 687) • Hence, persons who are not parties to registration proceedings who took possession of the land after final adjudication of the same cannot be summarily ousted by a mere motion. Regardless of any title or lack of title of said person, he cannot be ousted without giving him a day in court in a proper independent proceeding. (Bernas v. Nuevo 127 SCRA 399) • Such writ cannot be issued in a petition for reconstitution. Reason: Reconstitution does not adjudicate ownership over the property. A writ of possession is issued to place the applicant-owner in possession. GR: the right to ask possession does not prescribe XPN: if a party has once made use of the benefit of a writ of possession, he cannot

again ask for it if afterwards he loses possession of the property obtained by virtue of the original writ. 10. Issuance of decree by court declaring the decision final & instructing the NALDTRA to issue a decree of confirmation& registration. 11. Entry of decree of registration in NALDTRA . • Registration in the name of a particular person vests in him not only the title to the land but also title to improvements thereon, unless special reservation is noted with respect to the improvements (Blas v.de la Cruz et al. 37 Phil. 1) 12. Sending of copy of decree of registration to corresponding RD. 13. Transcription of decree of registration in the registration book &issuance of owner’s duplicate original certificate of title (OCT) of applicant by RD, upon payment of prescribed fees. Q: Who are the persons who may apply for registration? A: 1.Those who by themselves or through their predecessors-in-interest have been in open, continuous, exclusive, and notorious (O.C.E.N.)possession & occupation of alienable &disposable lands of public domain under a bona fide claim of ownership since June 12,1945 or earlier 2. Those who have acquired ownership of private lands by prescription under provisions of existing laws 3. Those who have acquired ownership of private lands or abandoned river beds by right of accession or accretion 4. Those who have acquired ownership of land by any other manner provided by law (Section 14, PD 1529) • Where land is owned in common: all coowners shall apply jointly. • Where land is sold under pacto de retro: The vendor a retro may apply provided, should redemption period expire during the pendency of registration proceedings and ownership to the property is consolidated in the vendee a retro, the latter may continue the proceedings. • The word “persons” refer to natural persons who are citizens of the Phils. Juridical or artificial persons are excluded. Reason: The subject matter of the registration proceeding are alienable and disposable lands of public domain. • Private corporations can acquire alienable public lands only thru lease not exceeding 1,000 hectares. Such lease shall not exceed 25 years and renewable for not more than 25 years. NOTE: GR: An alien cannot acquire private lands. XPNS: 1) when acquisition is thru hereditary succession. Succession is limited only to intestate succession (Ramirez v. Vda de Ramirez 114 SCRA 704) 2) by an alien who was a former natural born citizen of the Phils. provided he only acquires 1,000 square meters

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

104 2007 Team Bar-Ops Civil Law Committee

(urban land) or 1 hectare (rural land for residence) **As a corporation sole has no nationality, it can acquire by purchase a parcel of private agricultural land without violating the constitutional prohibition. (Roman Catholic Apostolic of Davao v. Land Registration Commission 102 Phil 596) • Owner of building constructed on land of another cannot apply. He may prove ownership of the building at the time of hearing so that his title may be noted on the decree. (Manila Building Assoc. v. Peñalosa 13 Phil 575) • The fact that the land was registered during marriage does not prove that it was acquired during the marriage. Reason: Registration does not confer title; it merely confirms a title already existing and which is registrable. • With respect to property subject to reserve troncal, the reserver has the right to apply but the reservable character of the property will be annotated in the title. Q: What are Muniments of Title? A: Instruments or written evidence w/c the applicant holds/possesses to enable him to substantiate &prove title to his estate Q: What is the Doctrine of Non-Collateral Attack of Decree or Title? A: A decree of registration & registered title cannot be impugned, enlarged, altered, modified, or diminished either in collateral or direct proceeding, after the lapse of period prescribed by law Q: What is the difference between direct attack and collateral attack? A: In the former, the issues are raised in a direct proceeding in an action instituted for that purpose. The latter is made when, in another action to obtain a different relief, an attack on the judgment is made as an incident in said action. Example of a collateral attack: Torrens title is questioned in the ordinary civil action for recovery of possession. Q: What is the Reconstitution of Certificate of Title? A: It is the restoration of the instrument w/c is supposed to have been lost or destroyed in its original form &condition. 3 elements: 1) Certificate has been lost or destroyed 2) Petitioner is the registered owner or has an interest therein 3) Certificate was in force at the time it was lost or destroyed. Q: What are the two kinds of reconstitution of title? A: 1. Judicial - the registered owners, assigns, or any person having an interest in the property may file a petition for that purpose with RTC where property is located. RD is not the proper party to file the petition.

2. Administrative - may be availed of only in case of substantial loss or destruction of land titles due to: • fire, • flood, or • other force majeure where the number of certificates of title lost or damaged is at least 10% of the total number of tites in the custody of RD but in no case shall be less than 500. Q: Is mere registration in the entry or day book of the deed of sale without the presentation of the duplicate certificate enough to effect conveyance? A: It depends: In case of voluntary transfer, NO. Reason: Such is the willful act of the owner. It is presumed that he is interested in registering the instrument. In case of involuntary transfer, YES. Reason: Such registration is contrary to the interests of the owner. Mere entry is enough. • The fact that no transfer certificate of title has as yet been issued by the ROD in the name of the vendor, cannot detract from the rights of a purchaser for value and in good faith entitled to the protection of law, once the deed of sale has been recorded in the day book. What remains to be done lies not within his power to perform. (Levin v. Bass 91 Phil. 420) - When land subject of a sale is registered in the name of the purchaser, registration takes effect retroactively as of the date the deed was noted in the entry book by the ROD. (Fidelity and Surety Co. v. Conegero 41 Phil. 396) Q: What is the Cadastral System of Land Registration? A: When, in the opinion of the President of the Phils, public interest so requires that the title to any unregistered lands be settled and adjudicated, he may, to this end, direct and order the Director of Lands to cause to be made a cadastral survey of the lands involved and the plans and technical description thereof prepared in due form (Section 35 PD 1529) Purpose: To serve public interest by requiring that the title to all lands “be settled and adjudicated. Q: What is the Procedure in Cadastral Registration? A: 1. Cadstral survey 2. Filing of petition 3. Publication of Notice of initial hearing 4. Filing of Answer 5. Hearing of case 6. Decision 7. Issuance of decree & certificate of title • Cadastral courts do not have the power to determine and adjudicate title to a lot already

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covered by homestead patent to a person other than a patentee (Manalo v. Lucban 48 Phil 973) • Cadastral court possesses no authority to award damages. (Abellera v. de Guzman O.G. No. 9 September 1951)

Nature of Registration Applicant Lands Covered

Parties Purpose

PD 1529

CADASTRAL

Voluntary

Compulsory

Landowner Usually -Private land; also refers to public agricultural land if object of action is confirmation of title Applicant & opponent

Director of Lands All classes of lands

Confirm title & register land in petitioner’s name

Who Requests Landowner Survey Effect of NO adverse claim; if Judgment applicant fails to prove title, his application may be dismissed w/o prejudice (no res judicata)

Landowners (as claimant of own lands) Gov’t asks court to settle & adjudicate title of land Government If none of applicants prove he is entitled to land, same be declared public (res judicata)

NOTICE OF LIS PENDENS When Applicable When Inapplicable 1.Recover possession of real estate 2.Quiet title 3.Remove clouds upon title 4.For Partition 5.Any other proceeding of any kind in court directly affecting title to the land or its use or occupation or the building thereon

1.Attachments 2.Levy or execution 3.Proceedings on probate of wills 4.Administration of the estate of deceased person 5.Proceedings for the recovery of money judgments

Q: What are the requirements for registrability of deeds & other voluntary acts of conveyance? A: (P.I.P.E.) 1. Presentation of owner’s duplicate certificate whenever any duly executed voluntary instrument is filed for registration 2. Inclusion of one extra copy of any document of transfer or alienation of real property, to be furnished city or provincial assessor. 3. Payment of prescribed registration fees & requisite doc stamps 4. Evidence of full payment of real estate tax as may be due. NOTE: GR: Boundaries prevail over area. XPNS: 1. Boundaries relied upon don’t identify land beyond doubt; 2. Boundaries given in the registration plan do not coincide w/ outer boundaries of the land

covered &described in the muniments of title Q: What are the involuntary dealings affecting Registered Lands? A: 1. Attachments a. Preliminary attachment b. Garnishment c. Levy on execution 2. Registration of sale of land on execution, or for taxes, or for any assessment 3. Adverse claim Requisites for Registrability: a) Adverse to registered owner; b) Arises after original registration; c) Cannot be registered under any other provisions of the LRA Q: What are the Statutory Liens affecting title? (Not barred although not noted in the title) A: 1. Liens, claims or rights arising or existing under the laws and the Constitution not required by law to appear of record in the R of D 2. Unpaid real estate taxes levied & assessed w/in 2 years immediately preceding the acquisition of any right over the land by an innocent purchaser fro value w/o prejudice to right of the gov’t. to collect taxes payable before that period from the delinquent taxpayer alone 3. Public highway or private way established or recognized by law or any gov’t. irrigation canal or lateral thereof 4. Any disposition of the property or limitation on the use thereof by virtue of laws or regulations on agrarian reform (Section 44 PD 1529) Q: What are the remedies of aggrieved party in Registration Proceedings? A: (RRRRAN) 1. Review of decree of registration • Grounds: 1). that a land belonging to a person has been registered in the name of another or that an interest has been omitted in the application 2). Registration has been procured thru actual fraud 3). Petitioner is the owner of the said property or interest therein. 4). Property has not been transferred to an innocent purchaser for value. 5). Action is filed within one year from the issuance and entry of the decree of registration 6). Actual fraud must be utilized in the procurement of the decree and not thereafter. • Actual fraud means “intentional omission of a fact required by law to be stated in the application or willful statement of a claim against the truth” What is contemplated by law is extrinsic fraud. • Extrinsic or collateral fraud v. intrinsic fraud:

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

106 2007 Team Bar-Ops Civil Law Committee

- The former connotes any fraudulent scheme executed by the prevailing party outside the trial of the case against the defeated party. - The latter covers fraudulent acts of a party in litigation during the trial. • Petition for review shall not lie if property has been transferred to innocent purchaser for value. • An innocent purchaser for value includes a lessee, mortgagee, or other encumbrances for value. • If the land in question was not brought under the operation of Torrens system because the original certificate of title is null and void ab initio, concept of innocent purchaser for value does not apply.

•

Doctrine that a forged instrument may become the root of a valid title: where the forger thru insidious means obtains the owner’s duplicate certificate of title, converts it in his name, and subsequently sells or otherwise encumbers it to an innocent purchaser for value. 2. Relief from judgment • Applies if the petition is filed within the prescribed period and decree of registration has not yet been issued. • Even if an order for the issuance of decree has been issued but no decree was actually issued, remedy is still available. • A party who has filed a timely motion for new trial cannot file a petition for relief after his motion has been denied. (Francisco v. Puno 108 SCRA 427) 3. Reconveyance • The complaint for cancellation of owner’s Torrens title must be filed in the original land registration case. • It cannot be filed when property has been transferred to an innocent purchaser for value. • If ground relied upon is fraud, action may be filed within 4 years from discovery thereof. Discovery is deemed to have taken place when said instrument was registered. Reason: Registration constitutes constructive notice to the whole world. 4. Recovery of Damages • Filed in an ordinary action for damages if the property has passed unto the hands of an innocent purchaser for value 5. Appeal • Only those who participated in the proceedings can interpose an appeal • Only applicant and oppositor are parties in land registration proceedings. Motion to intervene is improper. Remedy in lieu of motion to intervene: Ask for the lifting of an order of general default. If lifted, to file an apposition. Reason: Land registration proceedings are in rem and not in personam. • Execution pending appeal is not applicable to land registration proceedings. Reason: to protect innocent purchasers. Judgment may be reversed on appeal.

6. New trial Assurance Fund (AF) - “there shall be paid to the RD ¼ of 1% of the assessed value of the real estate on the basis of the last assessment for taxation purposes, as contribution to the assurance fund” . Q: What are the requisites for entitlement to compensation from AF? A: 1. Claimant (owner), purchaser or encumbrancer in GF, suffered actual damage by loss of the land or interest therein 2. No negligence is attributable to him. 3. Loss or damage suffered was not occasioned by a breach of trust or any mistake in the resurvey or subdivision of registered land. 4. Claimant is, by provisions of the LRA barred or in any way precluded from bringing an action to recover the land or interest therein, or from obtaining compensation from the person responsible 5. Action to recover from AF has not prescribed 6. Loss or damage was due to any of the following causes: a. Omission, mistake, misfeasance of the clerk of court or R of D b. Registration of another as owner of such land c. Mistake, omission, misdescription in a certificate or owner’s duplicate, or in any entry or memorandum in the register or other official book d. by any cancellation CONFLICT OF LAWS PRIVATE INTERNATIONAL LAW Definition

Functions

Part of municipal law of state w/c directs its courts and administrative agencies, when confronted w/ a legal problem involving foreign element, whether or not they should apply foreign law/s or not 1. Determination of which country has jurisdiction 2. Applicability of a particular place of either the local or foreign law 3. Determination of the force, validity &effectiveness of a foreign judgment

Q: How is Private distinguished from Public International Law? A: 1. Monist school – both subjects are essentially the same, because they manifest a single concept of law, ultimately addressed to the same individual. 2. Dualist School Private International Law Nature

Municipal in character

Persons Involved

Private individuals

Transactions

Private transactions b/w private

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Public International Law International in character Sovereign states and other entities possessed of international personality Transactions w/ generally affect

107 CIVIL LAW NOTES

Involved

individuals

Remedies/ Sanctions

Resort to municipal tribunals

ADVISER: ATTY. CARLA SANTAMARIA- SEÑA

public interest; or of interest only to sovereign states Remedies may be peaceful or forcible

Q: What are the sources of Private International Law? A: 1. Indirect sources a) Natural moral law b) Works of writers 2. Direct sources a) Constitutions b) Codifications c) Special laws d) Treaties and conventions e) Judicial decisions f) International customs (like lex situs and lex loci celebrationis). Q: What are the alternatives given to the court? A: Whenever a conflicts problem presents itself before a tribunal of the forum, the court is primarily confronted with the question of jurisdiction. When a court is without jurisdiction, it has no alternative except to dismiss the case. Any judgment rendered without or in excess of jurisdiction is clearly null and void.

1. 2.

On the other hand, when a tribunal possess jurisdiction, it may: Refuse to assume jurisdiction on the ground of “forum non conveniens” or Assume jurisdiction, in which case it may either: a) Apply the internal law of the forum (lex fori); or b) Apply the proper foreign law (lex causae). Q: What is Forum Non Conveniens? A: The refusal to assume jurisdiction because it would prove inconvenient for the forum. Q: When can Internal or Domestic law be applied? A: (E.N.E.) 1. Law of forum expressly so provides in its conflicts rule 2. Proper foreign law has not been properly pleaded and proved 3. Case involves any of the exceptions to the application of proper foreign law. **When the foreign law, judgment or contract is: ( C.C.P.P.-F.R.I.N) a) Contrary to sound and established policy of the forum b) Contrary to almost universally conceded principles of morality (contra bonos mores) c) Involves procedural matters d) Involves penal laws, contracts, judgments e) Purely fiscal or administrative matters f) Involves real or personal property situated in the forum

When application of the foreign law, judgment or contract: g) May work undeniable injustice to the citizens/residents of the forum h) May work against vital interests& national security of the state of the forum Q: What are the theories on why the Foreign Law may be given effect? A: 1. Theory of Comity – recognition w/c a nation allows w/in its territory, to the legislative, executive, or judicial acts of another nation, having due regard to both international duty & convenience and to the rights of its citizens, of other persons under its protection Kinds of Comity: a. Comity based on reciprocity b. Comity based on the persuasiveness of the foreign judgment 2. Theory of Vested Rights – to enforce not the foreign law or foreign judgment itself but the simply the vested rights that have been vested under such foreign law or judgment. 3. Theory of Local Law – to apply foreign law, not because it is foreign, but because our own rules by applying similar rules require us to do so, hence it is as if the foreign law has become part & parcel of our own local law. 4. Theory of Harmony of Law – to apply the foreign law so that wherever a case is decided, that is, irrespective of the forum, the solution should be approximately the same, as such, identical or similar problems must have identical or similar solutions somewhere. 5. Theory of Justice - purpose of all laws is the dispensation of justice, if this can be attained by applying the proper foreign law, then we must do so. Q: What are Conflict Rules? A: provisions found in a country’s own law which govern factual situations possessed of foreign element. Kinds: a. One-sided ruleindicates when Philippine internal law will apply (e.g. Art. 15 C.C.). b. All-sided rule-indicates when foreign law is to be applied (e.g. Art. 16). Q: What are the Theories on Personal Law or the Law that should govern Status and Capacity in General? 1. Nationality theory – by virtue of which the status and capacity of an individual are generally governed by the law of his nationality. (Personal theory). 2. Domiciliary theory –states the law of the domicile as the proper determinative law on status and capacity. (Territorial theory). 3. Situs theory –views the particular place or situs of an event or transaction as generally the controlling law. (Eclectic theory).

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula

108 2007 Team Bar-Ops Civil Law Committee

Note: In this jurisdiction, we adhere to the Nationality theory (Art 15; 2nd par., Art 16; also Art. 1039 C.C.). Q: What is domicile? A: It is the place with which a person has a settled connection for certain legal purposes, either because his home is there or because that is the place assigned to him by law. Q: What are the basic principles of domicile? A: 1. No natural person can ever be without a domicile. 2. That a person can have but one domicile at a time. 3. Every natural person, free and sui juris, may establish and change his domicile. 4. A domicile once acquired is retained until a new one is gained. 5. The presumption is in favor of continuance of an existing domicile. Q: What are the four essential requisites needed in order to acquire a domicile of choice? A: (C.A.F.I) 1. Capacity 2. Actual physical presence in the place chosen 3. Freedom of choice 4. Provable intent that it should be one’s fixed and permanent place of abode – one’s home – that is, there should be “animus manendi” (intent to remain) or “animus non-revertendi” (intent not to return to the original abode). Q: Define: cognovit, borrowing statute, characterization, Doctrine of forum nonConveniens, long-arm statute, conflicts case a. Cognovit- confession of judgment whereby a portion of the complaint is confessed by the defendant who denies the rest thereof b. Borrowing statute-laws of the state on jurisdiction used by another state in deciding conflicts question involved in the choice of law. It directs the state of the forum to apply the foreign statute of limitations to the pending claims based on the foreign law and has the practical effect of treating the foreign statute of limitations as one of substance. It bars the filing of a suit in the forum if it is already barred by the statute of limitations in the place wher the cause of action arose. Thus, when the country has a borrowing statute, the characterization of a statute into a procedural or substantive law becomes irrelevant. c.Characterization- otherwise called classification or qualification. It is the process of assigning a disputed question to its correct legal category. d.Forum non-conveniens-principle in private international law that where the ends of justice strongly indicate that the controversy may be more suitably tried elsewhere, then jurisdiction should be declined and the parties relegated to relief to be sought in another forum. e. Long arm-statute is a legislative act which provides for personal jurisdiction, via substituted

service or process over persons or corporations which are non-residents of the state and which voluntarily go into the state directly or by agent or communicate with persons in the state for limited purposes, in actions which concern claims relating to performance or execution or those purposes; Long-arm statute refers simply to authorized substituted service. f. Where the factual antecedents satisfactory establish the existence of a foreign element, the problem could present a conflicts case. A factual situation that cuts across territorial lines and is affected by the diverse laws of two or more states is said to contain a “foreign element.” DOMICILE OF ORIGIN and CONSTRUCTIVE DOMICILE DOMICILE OF ORIGIN CONSTRUCTIVE DOMICILE Acquired at birth Applies only to infants

Never changes

1.Given after birth Refers to all those who lack capacity to choose their domicile: infants, idiots and the insane. May change from time to time.

Q: What are the legal classifications of Domicile? A: 1. Domicile of origin – the domicile of a person’s parents at the time of birth. 2. Constructive domicile – domicile established by law after birth in case of persons under legal disability, regardless of their intention or voluntary act. 3. Domicile of Choice – is the place voluntarily chosen by a person sui juris as his home and to which, whenever he is absent, he has the intention to return. Q: What is the meaning of “Renvoi”? A: a French word that means “a referring back”. It is a term used in Conflicts of Laws to denote the phenomenon where the conflicts rule of the forum makes a reference to a foreign law, but the foreign law is found to contain a conflict rule that returns or refers back the matter to the law of the forum. Q: What are the solutions to the problem of Renvoi? A: 1. Reject the renvoi (Here we do not want the referring back to us – so we apply the foreign internal law. 2. Accept the renvoi (Here we welcome the reference back to us – so we apply our internal law). 3. Follow the Theory of Desistment (also referred to as Mutual Disclaimer of Jurisdiction Theory - hence we follow our own internal law). 4. Make use of the Foreign Court Theory ( this means that the Philippine court will put itself in the position of the foreign court – and whatever the foreign court will do respecting the case, the Philippine court will do likewise. Q: What is double renvoi? A: It is what occurs when the local court, in adopting the foreign court theory, discovers that the

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foreign court accepts the renvoi (hence ultimately, it is the foreign internal law that will be used. Q: What is transmission? A: It is the process of applying the law of a foreign state through the law of a second foreign state Q: What are the differences between RENVOI (single or double) and TRANSMISSION? RENVOI TRANSMISSION 1. Deals with 2 countries 2. Deals with “referring back”

1. Deals with 3 or more countries 2. Deals with a “referring across” or a “transmitting”

Q: What are the PHILIPPINE CONFLICT RULES FOUND IN THE CIVIL CODE? Article Defining Points Territoriality Principle 14 Nationality Principle 15 Lex Rei Sitae 16 Lex Loci Celebrationis 17 When either or both of the parties to a 21,FC

26,FC

80,FC

815

816

817

819 829

1039 1753

marriage are aliens, it is necessary, before securing marriage license, to provide themselves w/ certificate of legal capacity to contract marriage. All marriages solemnized outside Philippines in accord w/ the law in force in the country where they are solemnized, and valid there as such, shall also be valid here EXCEPT those prohibited under Arts 35 (1), (4), (5), (6), 36,37, 38 of FC. In absence of contrary stipulation in a marriage settlement, property relations of spouses shall be governed by Philippine laws regardless of the place of the celebration of marriage& their residence The will of a Filipino in a foreign country, provided he is authorized to make a will in any of the forms established in the country where he is, may be probated in the Philippines Will of an alien produces effect in the Philippines if made w/ formalities prescribed by law of the place where he resides, or of his own country, or of the Civil Code of the Philippines If an alien makes a will in the Philippines in accord w/ formalities prescribed by the laws of his country, his will shall have same effect as if executed according to Philippine laws Joint wills executed by Filipinos in a foreign country will not be valid Revocation of will done outside Philippines by person who does not have his domicile here is valid when done according to the law of the place where testator had his domicile at the time Capacity to succeed is governed by decedent’s national law Law of the country to w/c goods are to be transported shall govern the liability of the common carrier for their loss, destruction or deterioration

2007 UST TEAM BAR-OPS CIVIL LAW COMMITTEE Academics Committee Chairperson: Dominique Jose S. Puzon Civil Law Committee Chairperson: Ayn Marie Grace G. Barit-Carig Vice-Chairperson: Dexter Matias / Members: Clarissa Santos, Raphael Joseph Siares, Helen Grace Ilano, Marvin Zales, Isaiah Asuncion, Melanie Ganaban, Angelo Grande, Bernadette Aguirre, Maria Ethelyn Adaoag, Isser Gatdula