CHANGES IN THE NEW CIVIL CODE General Rule: Laws must be published in either

1. Granting of new rights the Official Gazette or a newspaper of general

Example: The Family Code erases the circulation.
distinction between natural and spurious Exception: The law may provide for another
children. Now they are lumped together as manner of publication. Different manner meaning:
illegitimate. Thus, spurious children are given 1. Not in Official Gazette or newspaper of general
rights. circulation; or
2. Different solutions to old problems Example: Read over the television or the radio
Example: Change in river course (provided that the alternative is reasonable)
3. Clarification of old provisions 2. Change in the period of effectivity
Example: Under the old Civil Code, there were publication means making it known;
only void and voidable contracts. With the dissemination. It doesnt have to be in writing.
addition of unenforceable and rescissible Change period of effectivity the gap between
contracts, the NCC provides clarification publication and effectivity should be reasonable
4. Certain subjects omitted under the circumstances.
Examples: The dowry has been omitted; certain Before publication, cannot apply the law whether
leases have also been omitted. penal or civil (Pesigan vs. Angeles) Why? How can
The NCC is far from perfect. There are you be bound if you dont know the law.
structural defects. Certain things which should be in the Requirement of publication applies to all laws and is
preliminary section are found elsewhere. An example of mandatory.
this is the vices of consent. Why are they found in
contracts? They are relevant in all juridical transactions. Art. 3. Ignorance of the law excuses no
Another example is the topic of degrees of relationship. one from compliance therewith.
This is found only in succession. Degrees of relationship
are relevant in other books too. Finally, why is tradition Ignorantia legis neminem excusat (Ignorance of the
found in the law on sales? Tradition is not only law excuses no one).
important in sales. Rather, tradition is a mode of This is a necessary rule for all civilized society.
acquiring ownership. Otherwise it would be impossible to enforce the law.
It is very hard to determine whether or not a person
PRELIMINARY TITLE really does not know the law. Without this rule,
there would be anarchy. The law sacrifices
I. Effect and Application of Laws occasional harshness to prevent universal anarchy.
There are potential methods to mitigate the severity
Art. 1. This Act shall be known as the of Article 3 Articles 526 (3), 2155, 1334.*
Civil Code of the Philippines.
In Kasilag vs. Rodriguez, the SC said that the
possession of the antichretic credit as possession in
Art. 2. Laws shall take effect after fifteen
good faith since a difficult question of law was
days following the completion of their
involved antichresis. In this case, the parties were
publication in the Official Gazette, unless it is
not very knowledgeable of the law.
otherwise provided. This Code shall take effect
Article 3 applies only to ignorance of Philippine law.
one year after such publication.
It does not apply to foreign law. In Private
International Law, foreign law must be proven even
This code shall take effect 1 year after such
if it is applicable. Otherwise, the courts will presume
publication. The SC in the case of Lara vs. Del
the foreign law to be the same as Philippine law.
Rosario that the one year should be counted from
the date of actual release and not the date of issue.
Art. 4. Laws shall have no retroactive
Executive Order No. 200 supersedes Article 2 effect, unless the contrary is provided.
regarding the time of effectivity of laws.
15 days following - does this mean on the 15th or
16th day? The law is not clear.
Under Article 2, publication in the Official Gazette *
Art. 526, 3. Mistake upon a doubtful or difficult
was necessary. Now, under E.O. No. 200, question of law may be the basis of good faith.
publication may either be in the Official Gazette or a Art. 2155. Payment by reason of a mistake in
newspaper of general publication. the construction or application of a doubtful or difficult
unless otherwise provided refers to when the question of law may come within the scope of the
law shall take effect. It does not mean that preceding article.
publication can be dispensed with. Otherwise, that Art. 1334. Mutual error as to the legal effect
would be a violation of due process. of an agreement when the real purpose of the parties
is frustrated, may vitiate consent.

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Professor Ruben F. Balane Page 1 of 241
 Lex de futuro judex de preterito (The law provides Exceptions:
for the future, the judge for the past). 1. When the law itself authorized its validity (i.e.,
Retroactive law one which creates a new lotto, sweepstakes)
obligation and imposes a new duty or attaches a new 2. When the law makes the act only voidable and
disability with respect to transactions or not void (i.e., if consent is vitiated, the contract
considerations already past. is voidable and not void)
General Rule: Law must be applied prospectively. 3. When the law makes the act valid but punishes
Exceptions: the violator (i.e., if the marriage is celebrated by
1. If the statute provides for retroactivity. someone without legal authority but the parties
Exception to the exception: are in good faith, the marriage is valid but the
a. Ex post facto laws person who married the parties is liable)
b. Laws which impair the obligation of 4. When the law makes the act void but recognizes
contracts legal effects flowing therefrom (i.e., Articles 1412
2. Penal laws insofar as it favors the accused who is & 1413)
not a habitual criminal, even though at the time
of the enactment of such law final sentence has Art. 6. Rights may be waived, unless the
already been rendered. waiver is contrary to law, public order, public
3. Remedial laws as long as it does not affect or policy, morals, or good customs, or prejudicial
change vested rights. to a third person with a right recognized by law.
4. When the law creates new substantive rights
unless vested rights are impaired. What one can waive are rights and not obligations.
5. Curative laws (the purpose is to cure defects or Example, a creditor can waive the loan but the
imperfections in judicial or administrative debtor may not.
proceedings) There is no form required for a waiver since a waiver
6. Interpretative laws is optional. You can waive by mere inaction,
7. Laws which are of emergency nature or are refusing to collect a debt for example is a form of
authorized by police power (Santos vs. Alvarez; waiver.
PNB vs. Office of the President) Requisites of a valid waiver (Herrera vs. Boromeo)
1. Existence of a right
Art. 5. Acts executed against the 2. Knowledge of the existence of the right
provisions of mandatory or prohibitory laws 3. An intention to relinquish the right (implied in
shall be void, except when the law itself this is the capacity to dispose of the right)
authorizes their validity. General Rule: Rights can be waived.
Exceptions:
A mandatory law is one which prescribes some 1. If waiver is contrary to law, public order, public
element as a requirement (i.e., wills must be written policy, morals or good customs
Article 804; form of donations Article 749) 2. If the waiver would be prejudicial to a 3 rd party
A prohibitory law is one which forbids something with a right recognized by law. (e.g., If A owes B
(i.e., joint wills Article 818)
General Rule: Acts which are contrary to
mandatory or prohibited laws are void.
Art. 1412. If the act in which the unlawful or

forbidden cause consists does not constitute a criminal

Art. 804. Every will must be in writing and executed offense, the following rules shall be observed:
in a language or dialect known to the testator. (1) When the fault is on the part of both

Art. 749. In order that the donation of an contracting parties, neither may recover what
immovable may be valid, it must be made in a public he has given by virtue of the contract, or
document, specifying therein the property donated and demand the performance of the other's
the value of the charges which the donee must satisfy. undertaking;
The acceptance may be made in the same (2) When only one of the contracting parties is
deed of donation or in a separate public document, but at fault, he cannot recover what he has given
it shall not take effect unless it is done during the by reason of the contract, or ask for the
lifetime of the donor. fulfillment of what has been promised him. The
If the acceptance is made in a separate other, who is not at fault, may demand the
instrument, the donor shall be notified thereof in an return of what he has given without any
authentic form, and this step shall be noted in both obligation to comply his promise.
instruments. Art. 1413. Interest paid in excess of the

Art. 818. Two or more persons cannot make a will interest allowed by the usury laws may be recovered
jointly, or in the same instrument, either for their by the debtor, with interest thereon from the date of
reciprocal benefit or for the benefit of a third person. the payment.

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Professor Ruben F. Balane Page 2 of 241
 P10M, B cant waive the loan if B owes C and B
has no other assets.) What if customs are not contrary to law? The
Examples of waivers which are prohibited: custom would be countenanced. However, this does
1. Repudiation of future inheritance not mean that the custom would have obligatory
2. Waiver of the protection of pactum force.
commissorium
3. Waiver of future support Art. 12. A custom must be proved as a
4. Waiver of employment benefits in advance fact, according to the rules of evidence.
5. Waiver of minimum wage
6. Waiver of the right to revoke a will The law doesnt specify the cases when custom is
Art. 7. Laws are repealed only by relevant in litigation. But in case custom is relevant,
subsequent ones, and their violation or non- it should be proven.
observance shall not be excused by disuse, or Commentators say that custom is important in cases
custom or practice to the contrary. involving negligence. For example, if a kalesa in
When the courts declared a law to be Manila is by custom supposed to have rattan baskets
inconsistent with the Constitution, the former to prevent people from slipping, if a person slips
shall be void and the latter shall govern. because there is no rattan basket, then he can sue for
Administrative or executive acts, orders negligence.
and regulations shall be valid only when they are
not contrary to the laws or the Constitution. Art. 13. When the laws speak of years,
months, days or nights, it shall be understood
Article 7 is obvious because time moves forward. that years are of three hundred sixty-five days
Only subsequent laws can repeal prior laws either each; months, of thirty days; days, of twenty-
through: four hours; and nights from sunset to sunrise.
1. A repealing clause If months are designated by their name,
2. Incompatibility of the subsequent and prior laws they shall be computed by the number of days
The violation of a law is not justified even if: which they respectively have.
1. No one follows the law (i.e., nonpayment of In computing a period, the first day shall
taxes) be excluded, and the last day included.
2. There is a custom to the contrary
The 2nd par. of Article 7 is judicial review in statutory Article 13 has been superseded by Executive Order
form. No. 292 (the Revised Administrative Code of 1987)
Book 1, 31.
Art. 8. Judicial decisions applying or
interpreting the laws or the Constitution shall Sec. 31. Legal Periods. - "Year" shall be
form a part of the legal system of the Philippines. understood to be twelve calendar months;
"month" of thirty days, unless it refers to a
This is a new provision taken from common law. specific calendar month in which case it shall be
Under the civil law tradition, the court merely computed according to the number of days the
applies the law. However since the Philippine legal specific month contains; "day," to a day of
system is a combination of civil law and common twenty-four hours; and "night," from sunset to
law, courts apply statutes as well aas resort to the sunrise.
doctrine of precedent.
Art. 9. No judge or court shall decline to Under E.O. No. 292, a year is now equivalent to 12
render judgment by reason of the silence, calendar months and not 365 days. Under Article 13
obscurity or insufficiency of the laws. leap years are not considered. For examples, in
order to make a will, one has to be 18 years old. But
Art. 10. In case of doubt in the if you use Article 13, one loses 4 to 5 days if you dont
interpretation or application of laws, it is count the leap years. E.O. No. 292 is better than
presumed that the lawmaking body intended Article 13 since it is more realistic.
right and justice to prevail. There should have been a definition of hours. That
definition is relevant for labor law. According to
What if the law is silent? The court should render a Professor Balane, an hour should be defined as 1/24
decision based on justice as stated in Article 10. of a calendar day. If you use the definition that an
hour is equal to 60 minutes, then we would have to
Art. 11. Customs which are contrary to define minutes, then seconds, and so on. It would be
law, public order or public policy shall not be too scientific.
countenanced.

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Professor Ruben F. Balane Page 3 of 241
II. Conflicts of Law Provisions Under Article 15, the Philippines follows the
nationality theory. Family rights and duties, status
Art. 14. Penal laws and those of public and legal capacity of Filipinos are governed by
security and safety shall be obligatory upon all Philippine law.
who live or sojourn in the Philippine territory, General Rule: Under Article 26 of the Family
subject to the principles of public international Code, all marriages solemnized outside the
law and to treaty stipulations. Philippines in accordance with the laws in force in
the country where they were solemnized and valid
Two principles: there as such, is also valid in the Philippines.
1. Territoriality Exception: If the marriage is void under Philippine
General Rule: Criminal laws apply only in law, then the marriage is void even if it is valid in the
Philippine territory. country where the marriage was solemnized .
Exception: Article 2, Revised Penal Code. Exception to the exception:
2. Generality 1. Article 35, 2, Family Code
General Rule: Criminal laws apply to everyone
in the territory (citizens and aliens) Art. 35. The following marriages
Exceptions: In these instances, all the shall be void from the beginning:
Philippines can do is expel them (2) Those solemnized by any person not
a. Treaty stipulations which exempt some legally authorized to perform
persons within the jurisdiction of Philippine marriages unless such marriages
courts (e.g., Bases Agreement) were contracted with either or both
b. Heads of State and Ambassadors parties believing in good faith that
(Note: Consuls are subject to the jurisdiction the solemnizing officer had the legal
of our criminal courts.) authority to do so;

Art. 15. Laws relating to family rights and 2. Article 35, 3, Family Code
duties, or to the status, condition and legal
capacity of persons are binding upon citizens of Art. 35. The following marriages
the Philippines, even though living abroad. shall be void from the beginning:
(3) Those solemnized without license,
Theories on Personal Law: except those covered the preceding
1. Domiciliary theory - the personal laws of a Chapter;
person are determined by his domicile
2. Nationality theory - the nationality or Even if the foreign marriage did not comply
citizenship determines the personal laws of the with either s 2 and 3 of Article 35, Philippine law
individual will recognize the marriage as valid as long as it is
valid under foreign law.

Art. 2. Application of its provisions. Except as

provided in the treaties and laws of preferential Art. 16, 1. Real property as well as
application, the provisions of this Code shall be personal property is subject to the law of the
enforced not only within the Philippine Archipelago, country where it is stipulated.
including its atmosphere, its interior waters and
maritime zone, but also outside of its jurisdiction, Lex situs or lex rei sitae governs real or personal
against those who: property (property is subject to the laws of the
1. Should commit an offense while on a Philippine country in which it is located).
ship or airship; In Tayag vs. Benguet consolidated, the SC said that
2. Should forge or counterfeit any coin or
Philippine law shall govern in cases involving shares
currency note of the Philippine Islands or
of stock of a Philippine corporation even if the owner
obligations and securities issued by the
is in the US.
Government of the Philippine Islands;
3. Should be liable for acts connected with the
introduction into these islands of the Art. 16, 2. However, intestate and
obligations and securities mentioned in the testamentary successions, both with respect to
presiding number; the order of succession and to the amount of
4. While being public officers or employees, successional rights and to the intrinsic validity of
should commit an offense in the exercise of testamentary provisions, shall be regulated by
their functions; or the national law of the person whose succession
5. Should commit any of the crimes against is under consideration, whatever may be the
national security and the law of nations, nature of the property and regardless of the
defined in Title One of Book Two of this Code. country wherein said property may be found.

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Professor Ruben F. Balane Page 4 of 241
 This is merely an extension of the nationality theory Art. 18. In matters which are governed
in Article 15. by the Code of Commerce and special laws, their
The national law of the decedent regardless of the deficiency shall be supplied by the provisions of
location of the property shall govern. Thus, the this Code.
national law of the decedent shall determine who
will succeed. III. Human Relations
In Miciano vs. Brimo, the SC said that the will of a
foreigner containing the condition that the law of the Art. 19. Every person must, in the
Philippines should govern regarding the distribution exercise of his rights and in the performance of
of the properties is invalid. his duties, act with justice, give everyone his due,
In Aznar vs. Garcia, what was involved was the and observe honesty and good faith.
renvoi doctrine. In this case, the decedent was a
citizen of California who resided in the Philippine. Art. 20. Every person who, contrary to
The problem was that under Philippine law, the law, willfully or negligently causes damage to
national law of the decedent shall govern. On the another, shall indemnify the latter for the same.
other hand, under California law, the law of the state Art. 21. Any person who willfully causes
where the decedent has his domicile shall govern. loss or injury to another in manner that is
The SC accepted the referral by California law and contrary to morals, good customs or public
applied Philippine law (single renvoi). policy shall compensate the latter for the
Problem: What if the decedent is a Filipino damage.
domiciled in a foreign country which follows the
domiciliary theory? Art. 22. Every person who through an act
According to Professor Balane, one way to of performance by another, or any other means,
resolve the situation is this Philippine law should acquires or comes into possession of something
govern with respect to properties in Philippine while at the expense of the latter without just or legal
the law of the domicile should govern with respect to ground, shall return the same to him.
properties located in the state of domicile.
Art. 23. Even when an act or event
Art. 17. The forms and solemnities of causing damage to another's property was not
contracts, wills, and other public instruments due to the fault or negligence of the defendant,
shall be governed by the laws of the country in the latter shall be liable for indemnity if through
which they are executed. the act or event he was benefited.
When the acts referred to are executed
before the diplomatic or consular officials of the Art. 24. In all contractual, property or
Republic of the Philippines in a foreign country, other relations, when one of the parties is at a
the solemnities established by Philippine laws disadvantage on account of his moral
shall be observed in their execution. dependence, ignorance, indigence, mental
Prohibitive laws concerning persons, weakness, tender age or other handicap, the
their acts or property, and those which have for courts must be vigilant for his protection.
their object public order, public policy and good
customs shall not be rendered ineffective by laws Art. 25. Thoughtless extravagance in
or judgments promulgated, or by determinations expenses for pleasure or display during a period
or conventions agreed upon in a foreign country. of acute public want or emergency may be
stopped by order of the courts at the instance of
any government or private charitable institution.
Lex loci celebrationis (formal requirements of
contracts, wills, and other public instruments are
Art. 26. Every person shall respect the
governed by the country in which they are executed)
dignity, personality, privacy and peace of mind
There is no conflict between the 1 st of Article 16 and of his neighbors and other persons. The
the 1st of Article 17 since they talk of 2 different
following and similar acts, though they may not
things. constitute a criminal offense, shall produce a
Thus, the formal requirements of a contract cause of action for damages, prevention and
involving real property in the Philippines must other relief:
follow the formal requirements of the place where (1) Prying into the privacy of another's
the contract was entered into. However, if what is residence:
involved is not the formal requirements, then the law (2) Meddling with or disturbing the private
of the place where the properties (whether real or life or family relations of another;
personal) are located shall govern.

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Professor Ruben F. Balane Page 5 of 241
 (3) Intriguing to cause another to be rights and liberties of another person shall be
alienated from his friends; liable to the latter for damages:
(4) Vexing or humiliating another on (1) Freedom or religion;
account of his religious beliefs, lowly (2) Freedom of speech;
station in life, place of birth, physical (3) Freedom to write for the press or to
defect, or other personal condition. maintain a periodical publication;
(4) Freedom from arbitrary or illegal
Art. 27. Any person suffering material or detention;
moral loss because a public servant or employee (5) Freedom of suffrage;
refuses or neglects, without just cause, to (6) The right against deprivation of
perform his official duty may file an action for property without due process of law;
damages and other relief against he latter, (7) The right to a just compensation when
without prejudice to any disciplinary private property is taken for public use;
administrative action that may be taken. (8) The right to the equal protection of the
laws;
Art. 28. Unfair competition in (9) The right to be secure in one's person,
agricultural, commercial or industrial house, papers, and effects against
enterprises or in labor through the use of force, unreasonable searches and seizures;
intimidation, deceit, machination or any other (10) The liberty of abode and of changing
unjust, oppressive or highhanded method shall the same;
give rise to a right of action by the person who (11) The privacy of communication and
thereby suffers damage. correspondence;
(12) The right to become a member of
Art. 29. When the accused in a criminal associations or societies for purposes
prosecution is acquitted on the ground that his not contrary to law;
guilt has not been proved beyond reasonable (13) The right to take part in a peaceable
doubt, a civil action for damages for the same act assembly to petition the Government
or omission may be instituted. Such action for redress of grievances;
requires only a preponderance of evidence. (14) The right to be a free from involuntary
Upon motion of the defendant, the court may servitude in any form;
require the plaintiff to file a bond to answer for (15) The right of the accused against
damages in case the complaint should be found excessive bail;
to be malicious. (16) The right of the accused to be heard by
If in a criminal case the judgment of himself and counsel, to be informed of
acquittal is based upon reasonable doubt, the the nature and cause of the accusation
court shall so declare. In the absence of any against him, to have a speedy and
declaration to that effect, it may be inferred public trial, to meet the witnesses face
from the text of the decision whether or not the to face, and to have compulsory
acquittal is due to that ground. process to secure the attendance of
witness in his behalf;
Art. 30. When a separate civil action is (17) Freedom from being compelled to be a
brought to demand civil liability arising from a witness against one's self, or from
criminal offense, and no criminal proceedings being forced to confess guilt, or from
are instituted during the pendency of the civil being induced by a promise of
case, a preponderance of evidence shall likewise immunity or reward to make such
be sufficient to prove the act complained of. confession, except when the person
confessing becomes a State witness;
Art. 31. When the civil action is based on (18) Freedom from excessive fines, or
an obligation not arising from the act or cruel and unusual punishment, unless
omission complained of as a felony, such civil the same is imposed or inflicted in
action may proceed independently of the accordance with a statute which has
criminal proceedings and regardless of the not been judicially declared
result of the latter. unconstitutional; and
(19) Freedom of access to the courts.
Art. 32. Any public officer or employee, In any of the cases referred to in this
or any private individual, who directly or article, whether or not the defendant's act or
indirectly obstructs, defeats, violates or in any omission constitutes a criminal offense, the
manner impedes or impairs any of the following aggrieved party has a right to commence an
entirely separate and distinct civil action for

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Professor Ruben F. Balane Page 6 of 241
damages, and for other relief. Such civil action PERSONS
shall proceed independently of any criminal
prosecution (if the latter be instituted), and mat Person
be proved by a preponderance of evidence. Any physical or juridical being susceptible o frights
The indemnity shall include moral and obligations, or of being the subject of legal
damages. Exemplary damages may also be relations
adjudicated.
The responsibility herein set forth is not Persons vs. Things
demandable from a judge unless his act or A person is the subject of legal relations
omission constitutes a violation of the Penal A things is the object of legal relations
Code or other penal statute.
Art. 37. Juridical capacity, which is the
Art. 33. In cases of defamation, fraud, fitness to be the subject of legal relations, is
and physical injuries a civil action for damages, inherent in every natural person and is lost only
entirely separate and distinct from the criminal through death. Capacity to act, which is the
action, may be brought by the injured party. power to do acts with legal effect, is acquired and
Such civil action shall proceed independently of may be lost.
the criminal prosecution, and shall require only
a preponderance of evidence. 2 component elements of capacity:
1. Juridical capacity
Art. 34. When a member of a city or There are no degrees of juridical capacity.
municipal police force refuses or fails to render
Juridical capacity is the same in every
aid or protection to any person in case of danger
person. No one has more juridical capacity
to life or property, such peace officer shall be
than others. It is inherent in natural
primarily liable for damages, and the city or
persons. On the other hand, it arises in
municipality shall be subsidiarily responsible
artificial persons when such artificial
therefor. The civil action herein recognized shall
persons are created.
be independent of any criminal proceedings, and
2. Capacity to act
a preponderance of evidence shall suffice to
This is best presented by a spectrum:
support such action.

Art. 35. When a person, claiming to be

0% another Infant
injured by a criminal offense, charges Alien Most People 100%
with the same, for which no independent civil Nobody has 100% capacity to act. The law
action is granted in this Code or any special law, imposes restrictions on capacity to act. As
but the justice of the peace finds no reasonable long as one has contractual capacity (a.k.a.
grounds to believe that a crime has been full civil capacity) one is near 100% capacity
committed, or the prosecuting attorney refuses to act. Full civil capacity is not really 100%
or fails to institute criminal proceedings, the but close to it. With contractual capacity,
complaint may bring a civil action for damages one is generally able to perform contracts
against the alleged offender. Such civil action and dispose of property.
may be supported by a preponderance of Nobody has 0% capacity to act. Infants are
evidence. Upon the defendant's motion, the close to 0% but still have capacity to act. For
court may require the plaintiff to file a bond to example, even fetus has the right to succeed
indemnify the defendant in case the complaint and also have the right to the integrity of
should be found to be malicious. body. Aliens cannot own colleges or
If during the pendency of the civil action, broadcast media.
an information should be presented by the
prosecuting attorney, the civil action shall be Art. 38. Minority, insanity or imbecility,
suspended until the termination of the criminal the state of being a deaf-mute, prodigality and
proceedings. civil interdiction are mere restrictions on
capacity to act, and do not exempt the
Art. 36. Pre-judicial questions, which incapacitated person from certain obligations, as
must be decided before any criminal prosecution when the latter arise from his acts or from
may be instituted or may proceed, shall be property relations, such as easements.
governed by rules of court which the Supreme
Court shall promulgate and which shall not be in Art. 39. The following circumstances,
conflict with the provisions of this Code. among others, modify or limit capacity to act:
age, insanity, imbecility, the state of being a

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 7 of 241
deaf-mute, penalty, prodigality, family relations, Article 39, last has been amended by R.A. No.
alienage, absence, insolvency and trusteeship. 6809. 21 years is no longer the age of majority but
The consequences of these circumstances are 18.
governed in this Code, other codes, the Rules of Article 39, last What are the cases specified by
Court, and in special laws. Capacity to act is not law?
limited on account of religious belief or political
opinion. I. Natural Persons
A married woman, twenty-one years of
age or over, is qualified for all acts of civil life, Art. 40. Birth determines personality;
except in cases specified by law. but the conceived child shall be considered born
for all purposes that are favorable to it, provided
Articles 38 and 39 are really the same thing. They it be born later with the conditions specified in
are redundant. the following article.
Insolvency certain obligations cannot be
performed (i.e., one cannot pay off debts in favor of Art. 41. For civil purposes, the foetus is
one creditor while excluding other creditors) considered born if it is alive at the time it is
Trusteeship - one is placed in guardianship. completely delivered from the mother's womb.
Prodigality - it is not by itself a restriction. It is a However, if the foetus had an intra-uterine life
ground to be placed in guardianship of less than seven months, it is not deemed born
These restrictions dont exempt incapacitated if it dies within twenty-four hours after its
persons from certain obligations. Under Article 1156, complete delivery from the maternal womb.
there are 5 sources of obligations:
1. Law Principles:
2. Contract 1. For personality to be acquired one must be born
3. Delict 2. Once birth occurs, personality for favorable
4. Quasi-delict purposes retroacts to the moment of conception
5. Quasi-contract To be born means to be alive after the fetus is
Thus, Articles 38 and 39 prevent incapacitated completely separated from the mothers womb by
persons from incurring contractual obligations only. cutting off the umbilical cord.
Thus, even though an insane person cannot be General Rule: To be born, it is enough that the
thrown in jail for a criminal act, the insane person is fetus is alive when the umbilical cord is cut
still civilly liable (delict). An incapacitated person Exception: If the intra-uterine life is less than 7
must still pay income tax if income is earned. months, it must live for at least 24 hours, before it is
Although Articles 38 and 39 dont mention it, considered born (There is no distinction as to how
incapacitated persons may acquire rights. For the child dies whether natural, accidental, etc.)
example, they have the right to accept donations or According to Professor Balane, modern medicine
to succeed. cannot as of yet determine if the intra-uterine life is
The enumeration in Articles 38 and 39 is not 7 months or less in terms of number of days.
exclusive. There are others spread throughout the Modern medicine cannot determine the exact time
code. (i.e., a lawyer cannot buy property in litigation when fertilization took place. Modern medicine
Article 1491 (5)) estimates the fetus age in weeks.
An example of a case where upon birth occurs
personality retroacts to the moment of conception is

Art. 1491. The following persons cannot acquire by in case of succession since it is favorable to the child.
purchase, even at a public or judicial auction, either in On the other hand, if the purpose is for paying taxes,
person or through the mediation of another: personality does not retroact since it is unfavorable
(5) Justices, judges, prosecuting attorneys, to the child.
clerks of superior and inferior courts, and In Geluz vs. CA, the SC said that the father could not
other officers and employees connected with file the action for damages. The fetus never acquired
the administration of justice, the property personality because it was never born it was not
and rights in litigation or levied upon an alive at the time it was delivered from the mothers
execution before the court within whose womb. Since the fetus did not acquire any
jurisdiction or territory they exercise their personality, it acquired no rights which could be
respective functions; this prohibition includes transmitted to the father. Thus, the father could not
the act of acquiring by assignment and shall sue in a representative capacity. The father could
apply to lawyers, with respect to the have sued in his personal capacity had the father
property and rights which may be the object suffered anguish which he did not.
of any litigation in which they may take part
by virtue of their profession.

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Professor Ruben F. Balane Page 8 of 241
 Art. 42. Civil personality is extinguished This is a presumption regarding simultaneous death
by death. and not a rule on survivorship. On the other hand,
The effect of death upon the rights and the Rules provide for a presumption of survivorship
obligations of the deceased is determined by law, based on certain criteria.
by contract and by will. The Rules of Court shall apply where:
1. The issue does not involve succession but
This article deals with the extinguishment of civil something else (i.e., insurance, suspensive
personality conditions); and
Death is not defined in the Civil Code. Not even 2. The persons perish in the same calamity
doctors know precisely when death occurs. There Article 43 shall apply where:
are many theories. 1. The case involves succession; and
The fact of death is important because it affects civil 2. The persons do not perish in the same calamity.
personality and legal relations. The main effect of If the conditions in the Rules of Court or Article 43
death is readily seen in succession. Death is also do not concur, do not apply either.
relevant to labor law and insurance. Problem: What if succession is involved and the
persons perish in the same calamity?
Art. 43. If there is a doubt, as between Most commentators say Article 43 will prevail. This
two or more persons who are called to succeed is the only case of conflict between the Rules of
each other, as to which of them died first, Court and Article 43.
whoever alleges the death of one prior to the In Joaquin vs. Navarro, Article 43 was not applied.
other, shall prove the same; in the absence of There was no need to apply the presumption in
proof, it is presumed that they died at the same Article 43 since there was evidence to show who died
time and there shall be no transmission of rights first.
from one to the other.
II. Juridical Persons
RULE 131, RULES OF COURT
Sec. 3. Disputable presumptions. The Art. 44. The following are juridical
following presumptions are satisfactory if persons:
uncontradicted, but may be contradicted and (1) The State and its political subdivisions;
overcome by other evidence: (2) Other corporations, institutions and
(jj) That except for purposes of succession, entities for public interest or purpose,
when two persons perish in the same created by law; their personality begins
calamity, such as wreck, battle, or as soon as they have been constituted
conflagration, and it is not shown who according to law;
died first, and there are no particular (3) Corporations, partnerships and
circumstances from which it can be associations for private interest or
inferred, the survivorship is purpose to which the law grants a
determined from the probabilities juridical personality, separate and
resulting from the strength and age of distinct from that of each shareholder,
the sexes, according to the following partner or member.
rules:
1. If both were under the age of fifteen This enumerates the juridical persons.
years, the older is deemed to have A juridical person is an organic unit resulting from a
survived; group of persons or mass or property to which the
2. If both were above the age of sixty, state grants or recognizes personality and capacity to
the younger is deemed to have hold patrimonial rights independent of those of
survived; component members
3. If one is under fifteen and the other
The juridical personality of political subdivisions and
above sixty, the former is deemed to
public corporations (i.e., GSIS, SSS) commences
have survived;
when the law creating them becomes effective.
4. If both be over fifteen and under
The juridical personality of a private corporation
sixty, and the sex be different, the
commences upon incorporation with the SEC.
male is deemed to have survived; if
the sex be the same, the older; The juridical personality of a partnership
5. If one be under fifteen or over sixty, commences upon the meeting of the minds of the
and the other between those ages, parties.
the latter is deemed to have Although the Catholic Church is not one of those
survived. mentioned in Article 44, it is still considered as a

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Professor Ruben F. Balane Page 9 of 241
 juridical person in Barlin vs. Ramirez because of (5) Those who are naturalized in
tradition. accordance with law.

Art. 45. Juridical persons mentioned in This has been superseded by the Constitution.
Nos. 1 and 2 of the preceding article are
governed by the laws creating or recognizing ARTICLE IV, PHILIPPINE CONSTITUTION
them.
Private corporations are regulated by Section 1. The following are citizens of
laws of general application on the subject. the Philippines:
Partnerships and associations for private (1) Those who are citizens of the
interest or purpose are governed by the Philippines at the time of the adoption
provisions of this Code concerning partnerships. of this Constitution;
(2) Those whose fathers or mothers are
JURIDICAL PERSON GOVERNED BY citizens of the Philippines;
State Constitution (Defines its organization(3)andThose
limits born before
its rights January 17, 1973, of
vis--vis
citizens) Filipino mothers, who elect Philippine
Political subdivision Charter citizenship upon reaching the age of
Public corporation Charter majority; and
Private corporation Corporation Code, Articles of Incorporation Those
(4) and By-Laws who are naturalized in
Partnerships Stipulations of the parties and suppletorilyaccordance
by the general with law.
provisions
on partnership Art. 49. Naturalization and the loss and
reacquisition of citizenship of the Philippines
Art. 46. Juridical persons may acquire are governed by special laws.
and possess property of all kinds, as well as
incur obligations and bring civil or criminal Art. 50. For the exercise of civil rights
actions, in conformity with the laws and and the fulfillment of civil obligations, the
regulations of their organization. domicile of natural persons is the place of their
habitual residence.
Art. 47. Upon the dissolution of
corporations, institutions and other entities for Art. 51. When the law creating or
public interest or purpose mentioned in No. 2 of recognizing them, or any other provision does
article 44, their property and other assets shall not fix the domicile of juridical persons, the
be disposed of in pursuance of law or the charter same shall be understood to be the place where
creating them. If nothing has been specified on their legal representation is established or
this point, the property and other assets shall be where they exercise their principal functions.
applied to similar purposes for the benefit of the
region, province, city or municipality which Article 50 governs the domicile of natural persons.
during the existence of the institution derived Article 51 talks about the domicile of juridical
the principal benefits from the same. persons.
Requisites of Domicile (Callego vs. Vera):
Dissolution is found in detail in the Corporation 1. Physical Presence
Code. 2. Intent to remain permanently
Kinds of Domicile
III. Citizenship and Domicile 1. Domicile of Origin
Domicile of parents of a person at the time
Art. 48. The following are citizens of the he was born.
Philippines: 2. Domicile of Choice
(1) Those who were citizens of the Domicile chosen by a person, changing his
Philippines at the time of the adoption domicile of origin.
of the Constitution of the Philippines; A 3rd requisite is necessary intention not to
(2) Those born in the Philippines of foreign return to ones domicile as his permanent
parents who, before the adoption of place.
said Constitution, had been elected to 3. Domicile by Operation of Law (i.e., Article 69,
public office in the Philippines; domicile of minor)
(3) Those whose fathers are citizens of the Residence vs. Domicile
Philippines;
(4) Those whose mothers are citizens of the
Art. 69. The husband and wife shall fix the family
Philippines and, upon reaching the age domicile. In case of disagreement, the court shall
of majority, elect Philippine citizenship; decide.

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Professor Ruben F. Balane Page 10 of 241
 Residence is not permanent (There is no intent These provisions are without
to remain) prejudice to venue under the Rules of
Domicile is permanent (There is intent to Court.
remain)
According to the Supreme Court in Marcos vs. The concept of domicile is not as important in civil
COMELEC, the wife does not lose her domicile upon law countries unlike common law countries which
marriage. She does not necessarily acquire her follow the nationality theory.
husbands domicile. Until the spouses decide to get
a new domicile, the wife retains her old domicile. IV. Surnames
Under Article 698 of the Family Code, the domicile
is fixed jointly. Surnames are important for identification.
3 Rules: Surnames identify the family to which a person
1. A man must have a domicile somewhere. belongs (transmitted from parent to child).
2. A domicile once established remains until a new A name is a word or a combination by which a
one is acquired. person is known or identified (Republic vs.
3. A man can only have one domicile at a time. Fernandez)
The following Articles in the Civil Code mention Characteristics of Surnames
domicile: 1. Absolute intended to protect from confusion
1. Article 821 2. Obligatory
3. Fixed cant change at ones leisure
Art. 821. The following are 4. Outside the commerce of man cant sell or
disqualified from being witnesses to a donate
will: 5. Imprescriptible - even if one does not use, still
(1) Any person not domiciled in your name
the Philippines; Rules
(2) Those who have been convicted 1. As far as the state is concerned, your real name
of falsification of a document, is the one in the Civil Registry (not the baptismal
perjury or false testimony. certificate since parish records are no longer
official)
2. Article 829 2. Change of name can only be done through court
proceedings
Art. 829. A revocation done
outside the Philippines, by a person who Art. 376. No person can change
does not have his domicile in this his name or surname without judicial
country, is valid when it is done according authority.
to the law of the place where the will was
made, or according to the law of the place 3. However, a person can use other names which
in which the testator had his domicile at are authorized by C.A. No. 142 as amended by
the time; and if the revocation takes place R.A. No. 6085 (use of pseudonym)
in this country, when it is in accordance Guidelines regarding Change of Name
with the provisions of this Code. 1. In a petition for change of name, courts are
generally strict. You have to show sufficient
3. Article 1251 cause.
The cases of Naldoza vs. Republic and
Art. 1251. Payment shall be made Republic vs. Marcos illustrate what are
in the place designated in the obligation. sufficient causes. Republic vs. Hernandez
There being no express stipulation added an additional ground. The
and if the undertaking is to deliver a enumeration is not an exclusive list of
determinate thing, the payment shall be causes. They are merely the ones frequently
made wherever the thing might be at the cited.
moment the obligation was constituted. In Republic vs. CA, the child wanted to
In any other case the place of change to the surname of the stepfathers.
payment shall be the domicile of the The Supreme Court said this is not allowed
debtor. since it will cause confusion as to the childs
If the debtor changes his domicile paternity.
in bad faith or after he has incurred in 2. In a petition for injunction or in a criminal case
delay, the additional expenses shall be for violation of C.A. No. 142, courts are generally
borne by him.

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Professor Ruben F. Balane Page 11 of 241
 liberal for as long as there is no fraud or bad Elements of Article 377 (Usurpation):
faith. 1. There is an actual use of anothers name by the
In Legamia vs. IAC, the Supreme Court defendant
allowed the mistress to use her live-in 2. The use is unauthorized
partners name since everyone knew that she 3. The use of anothers name is to designate
was the mistress no confusion. personality or identify a person.
In Tolentino vs. CA, the Supreme Court Article 378 is using of the name for purposes other
allowed the former Mrs. Tolentino to keep than usurpation (i.e., slander; for example, I will use
on using the surname of Tolentino since the Dalivas surname in my product, calling it Daliva
same was not being used for fraudulent see-thru lingerie)
purposes.
3. In case of adoption where the woman adopts V. Emancipation and Age of Majority (RA
alone, it is the maiden name that should be given 6809)
the child (Johnston vs. Republic)
REPUBLIC ACT NO. 6809
Art. 370. A married woman may use: AN ACT LOWERING THE AGE OF MAJORITY
(1) Her maiden first name and surname FROM TWENTY-ONE TO EIGHTEEN YEARS,
and add her husband's surname, or AMENDING FOR THE PURPOSE EXECUTIVE
(2) Her maiden first name and her ORDER NUMBERED TWO HUNDRED NINE,
husband's surname or AND FOR OTHER PURPOSES
(3) Her husband's full name, but prefixing Sec. 1. Article 234 of Executive Order No.
a word indicating that she is his wife, 209, the Family Code of the Philippines, is
such as "Mrs." hereby amended to read as follows:
"Art. 234. Emancipation takes place
A married woman may use only her maiden name by the attainment of majority. Unless otherwise
and surname. She has an option and not a duty to provided, majority commences at the age of
use the surname of her husband as provided for in eighteen years."
Art. 370. This is the obiter dictum in Yasin vs. Sec. 2. Articles 235 and 237 of the same
Sharia which cites Tolentino. Code are hereby repealed.
According to Yasin vs. Sharia, when the husband Sec. 3. Article 236 of the same Code is
dies, the woman can revert to her old name without also hereby amended to read as follows:
need for judicial authorization. "Art. 236. Emancipation shall
terminate parental authority over the person
Art. 176, Family Code. Illegitimate and property of the child who shall then be
children shall use the surname and shall be qualified and responsible for all acts of civil life,
under the parental authority of their mother, save the exceptions established by existing laws
and shall be entitled to support in conformity in special cases.
with this Code. The legitime of each illegitimate "Contracting marriage shall require
child shall consist of one-half of the legitime of a parental consent until the age of twenty-one.
legitimate child. Except for this modification, all "Nothing in this Code shall be construed
other provisions in the Civil Code governing to derogate from the duty or responsibility of
successional rights shall remain in force. parents and guardians for children and wards
below twenty-one years of age mentioned in the
Illegitimate children shall use the surname of the second and third paragraphs of Article 2180 of
mother. the Civil Code."
Sec. 4. Upon the effectivity of this Act,
Art. 377. Usurpation of a name and existing wills, bequests, donations, grants,
surname may be the subject of an action for insurance policies and similar instruments
damages and other relief. containing references and provisions favorable
to minors will not retroact to their prejudice.
Art. 378. The unauthorized or unlawful Sec. 5. This Act shall take effect upon
use of another person's surname gives a right of completion of its publication in at least two (2)
action to the latter. newspapers of general circulation.
Approved: December 13, 1989
Articles 377 and 378 dont talk of the same thing.
Article 377 deals with the usurpation of names. Emancipation is the extinguishments of parental
There is usurpation when there is confusion of authority. It takes place at the age of 18.
identity (i.e. you claim to be Jaime Zobel)

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Professor Ruben F. Balane Page 12 of 241
 The problem with R.A. No. 6809, being a piece meal interested party, a relative, or a friend,
amendment, it does not take care of all references in may appoint a person to represent him in
the Civil Code with reference to the age of majority. all that may be necessary.
One defect of R.A. No. 6809 is that it restores the This same rule shall be observed
distinction between perfect and imperfect when under similar circumstances the
emancipation. The Family Code removed the power conferred by the absentee has
distinction which RA 6809 restored. Thus, although expired.
18 is the age of emancipation:
1. Persons between 18 to 21 still need parental Art. 382. The appointment
consent for marriage. referred to in the preceding article having
2. Parents or guardians are liable for the quasi- been made, the judge shall take the
delicts of persons who are already 18 years old necessary measures to safeguard the
under Article 2180 until he reaches the age of rights and interests of the absentee and
21. shall specify the powers, obligations and
According to Professor Balane, this is crazy. The remuneration of his representative,
basis for vicarious liability is parental authority. regulating them, according to the
Since parents and guardians no longer exercise circumstances, by the rules concerning
parental authority, they should no longer be guardians.
made liable. This is unjust because the parents
are no longer in a position to prevent their Art. 383. In the appointment of a
emancipated children from acting representative, the spouse present shall
responsibility without power. be preferred when there is no legal
2 of Article 2180 has been repealed by Article 221 separation.
of the Family Code. If the absentee left no spouse, or if the
spouse present is a minor, any competent
VI. Absence person may be appointed by the court.

Absence is that special legal status of one who is not Requisites for Provisional Absence
in his domicile, his whereabouts being unknown and 1. Absence for an appreciable period which
it being uncertain whether he is dead or alive. depends upon the circumstances
Example: When Lacson went to the US, Lacson was 2. Immediate necessity for his
not absent since his whereabouts were known. representation in some specific urgent
Stages of Absence (According to Seriousness) matter
1. Temporary or Provisional (Articles 381 3. Absentee left no agent or the agency has
383) expired.
The declaration of provisional absence
Art. 381. When a person (must go to court) is limited to a specific act.
disappears from his domicile, his
whereabouts being unknown, and 2. Normal or Declared (Articles 384 389)
without leaving an agent to administer his
property, the judge, at the instance of an Art. 384. Two years having
elapsed without any news about the
absentee or since the receipt of the last
Art. 2180. The obligation imposed by article 2176 is
news, and five years in case the absentee
demandable not only for one's own acts or omissions,
has left a person in charge of the
but also for those of persons for whom one is
administration of his property, his
responsible.
The father and, in case of his death or absence may be declared.
incapacity, the mother, are responsible for the Art. 385. The following may ask
damages caused by the minor children who live in their for the declaration of absence:
company. (1) The spouse present;
Guardians are liable for damages caused by (2) The heirs instituted in a will,
the minors or incapacitated persons who are under who may present an authentic
their authority and live in their company. copy of the same;

Art. 221. Parents and other persons exercising (3) The relatives who may succeed
parental authority shall be civilly liable for the injuries by the law of intestacy;
and damages caused by the acts or omissions of their (4) Those who may have over the
unemancipated children living in their company property of the absentee some
and under their parental authority subject to the right subordinated to the
appropriate defenses provided by law. condition of his death.

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Professor Ruben F. Balane Page 13 of 241
 If the absentee left no property to
Art. 386. The judicial declaration administer, then one cannot resort to a
of absence shall not take effect until six declaration of absence.
months after its publication in a For purposes of re-marriage, a declaration of
newspaper of general circulation. absence is not proper. In this case, what is
required is a summary proceeding for
Art. 387. An administrator of the presumptive death.
absentee's property shall be appointed in
accordance with article 383. 3. Presumptive Death
a. Ordinary Presumptive Death (Article
Art. 388. The wife who is 390)
appointed as an administratrix of the
husband's property cannot alienate or Art. 390. After an absence of
encumber the husband's property, or that seven years, it being unknown
of the conjugal partnership, without whether or not the absentee still lives,
judicial authority. he shall be presumed dead for all
purposes, except for those of
Art. 389. The administration shall succession.
cease in any of the following cases: The absentee shall not be
(1) When the absentee appears presumed dead for the purpose of
personally or by means of an opening his succession till after an
agent; absence of ten years. If he
(2) When the death of the absentee disappeared after the age of seventy-
is proved and his testate or five years, an absence of five years
intestate heirs appear; shall be sufficient in order that his
(3) When a third person appears, succession may be opened.
showing by a proper document
that he has acquired the 1. If absentee is 75 or below
absentee's property by purchase 7 years for all purposes except succession
or other title. 10 years - for succession
In these cases the administrator 2. If absentee is over 75 years old
shall cease in the performance of his 5 years for all purposes
office, and the property shall be at the
disposal of those who may have a right b. Qualified Presumptive Death (Article 391)
thereto.
Art. 391. The following shall be
Periods presumed dead for all purposes,
1. 2 years if he did not leave an agent including the division of the estate
2. 5 years if he left an agent among the heirs:
Computation of Period (1) A person on board a vessel lost during a
a. If no news, the period must be sea voyage, or an aeroplane which is
computed from the date of missing, who has not been heard of for
disappearance. four years since the loss of the vessel or
b. If there is news, the period must be aeroplane;
computed from the last time the (2) A person in the armed forces who has
absentee was referred to in the news taken part in war, and has been missing
(not receipt of last news) for four years;
For example, X in 1996 goes on a world (3) A person who has been in danger of
tour. On March 1, X poses for a picture death under other circumstances and his
and sends a postcard. This is received existence has not been known for four
by Y on September 1. X is not heard years.
from again. According to Professor Person on board a vessel lost during a sea
Balane, the disappearance should be voyage, missing airplane , person in the armed
counted from March 1 and not forces who has taken part in war, a person who
September 1. Counting from September has been in danger of death under other
1 just doesnt make sense! circumstances and his existence is not known.
The purpose of the declaration of absence is General Rule: 4 years for all purposes
for the court to have someone to administer
the property of the absentee Article 384.

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Professor Ruben F. Balane Page 14 of 241
 Exception: 2 years for purposes of remarriage The order given in Article 305 as to who has the right
(Article 41, Family Code) to make funeral arrangements follows the order for
Art. 41. A marriage contracted by support under Article 199* of the Family Code.
any person during subsistence of a
previous marriage shall be null and void, Art. 306. Every funeral shall be in
unless before the celebration of the keeping with the social position of the deceased.
subsequent marriage, the prior spouse
had been absent for four consecutive Art. 307. The funeral shall be in
years and the spouse present has a well- accordance with the expressed wishes of the
founded belief that the absent spouse deceased. In the absence of such expression,
was already dead. In case of his religious beliefs or affiliation shall determine
disappearance where there is danger of the funeral rites. In case of doubt, the form of
death under the circumstances set forth the funeral shall be decided upon by the person
in the provisions of Article 391 of the obliged to make arrangements for the same,
Civil Code, an absence of only two years after consulting the other members of the
shall be sufficient. family.
For the purpose of contracting
the subsequent marriage under the Art. 308. No human remains shall be
preceding paragraph the spouse present retained, interred, disposed of or exhumed
must institute a summary proceeding as without the consent of the persons mentioned in
provided in this Code for the declaration articles 294 and 305.
of presumptive death of the absentee,
without prejudice to the effect of Art. 309. Any person who shows
reappearance of the absent spouse. disrespect to the dead, or wrongfully interferes
with a funeral shall be liable to the family of the
When can you ask for a decree of presumptive deceased for damages, material and moral.
death for purposes of remarriage?
1. 4 years after disappearance Art. 310. The construction of a
2. 2 years if the circumstances fall under Article tombstone or mausoleum shall be deemed a part
391 of the funeral expenses, and shall be chargeable
Under these rules on presumptive death, there is to the conjugal partnership property, if the
no need for a court decree. The mere running deceased is one of the spouses.
of the period raises the presumption of death.
However, for purposes of remarriage, a VIII. Civil Registry
summary proceeding is required under Article
41 of the Family Code. Otherwise, the The Civil Registry is the repository of relevant facts
subsequent marriage is void. of a person (birth, adoption, nationalization,
In the case of Eastern Shipping vs. Lucas, the marriage, death, etc.)
Supreme Court did not apply Article 391. The
Supreme Court said that Article 391 is a Art. 407. Acts, events and judicial
rebuttable presumption. Being a presumption, decrees concerning the civil status of persons
Article 391 is applied only if there is no shall be recorded in the civil register.
evidence. In this case, the Supreme Court had
enough evidence to rule that the seaman was Anything which affects the civil status of persons
really dead. shall be recorded in the Civil Register. (Read also
Article 7, of PD 603)
VII. Funerals
*
Art. 199. Whenever two or more persons are obliged
Art. 305. The duty and the right to make to give support, the liability shall devolve upon the
arrangements for the funeral of a relative shall following persons in the order herein provided:
be in accordance with the order established for (1) The spouse;
support, under article 294. In case of (2) The descendants in the nearest degree;
descendants of the same degree, or of brothers (3) The ascendants in the nearest degree; and
and sisters, the oldest shall be preferred. In case (4) The brothers and sisters.
of ascendants, the paternal shall have a better
Art. 7. Non-disclosure of Birth Records. - The
right. records of a person's birth shall be kept strictly
confidential and no information relating thereto shall
be issued except on the request of any of the
following:

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Professor Ruben F. Balane Page 15 of 241
 Art. 411. Every civil registrar shall be
Art. 408. The following shall be civilly responsible for any unauthorized
entered in the civil register: (1) Births; (2) alteration made in any civil register, to any
marriages; (3) deaths; (4) legal separations; (5) person suffering damage thereby. However, the
annulments of marriage; (6) judgments civil registrar may exempt himself from such
declaring marriages void from the beginning; (7) liability if he proves that he has taken every
legitimations; (8) adoptions; (9) reasonable precaution to prevent the unlawful
acknowledgments of natural children; (10) alteration.
naturalization; (11) loss, or (12) recovery of
citizenship; (13) civil interdiction; (14) judicial Art. 412. No entry in a civil register shall
determination of filiation; (15) voluntary be changed or corrected, without a judicial
emancipation of a minor; and (16) changes of order.
name.
Entries in the civil register can only be corrected by a
Art. 409. In cases of legal separation, judicial proceeding. Without the judicial
adoption, naturalization and other judicial proceeding, the person would be guilty of
orders mentioned in the preceding article, it falsification of public documents and possibly other
shall be the duty of the clerk of the court which crimes regarding the civil status of persons (i.e.,
issued the decree to ascertain whether the same simulation of birth)
has been registered, and if this has not been Originally, Article 412 could only be resorted to if the
done, to send a copy of said decree to the civil error was merely clerical. In Barreto vs. Local Civil
registry of the city or municipality where the Registrar, the Supreme Court defined a clerical
court is functioning. error as one which is visible to the eyes or obvious to
the understanding. In this case, the alleged error
Art. 410. The books making up the civil being the gender of the person, the alleged error
register and all documents relating thereto shall could not be determined by a reference to the record.
be considered public documents and shall be In recent years, the Supreme Court has ruled that a
prima facie evidence of the facts therein petition for correction of entry under Article 412 and
contained. Rule 108 can be availed of to correct the following
errors:
Public documents shall be presumed to be accurate. 1. Clerical
Under Article 7 of PD 603, public documents are not 2. Substantial
accessible to everybody. If the error is clerical, a summary proceeding is
Correlate Article 410 with Article 15 of RA 8552 enough. If the error is substantial, an adversary
(The Domestic Adoption Act). proceeding with notice to all parties is necessary.

Art. 413. All other matters pertaining to

(1) The person himself, or any person authorized the registration of civil status shall be governed
by him; by special laws.
(2) His spouse, his parent or parents, his direct
descendants, or the guardian or institution FAMILY RELATIONS
legally in-charge of him if he is a minor;
(3) The court or proper public official whenever I. Marriage
absolutely necessary in administrative, judicial
or other official proceedings to determine the Art. 1. Marriage is a special contract of
identity of the child's parents or other permanent union between a man and a woman
circumstances surrounding his birth; and
entered into in accordance with law for the
(4) In case of the person's death, the nearest of
establishment of conjugal and family life. It is
kin.
the foundation of the family and an inviolable
Any person violating the prohibition shall suffer
social institution whose nature, consequences,
the penalty of imprisonment of at least two months or
a fine in an amount not exceeding five hundred pesos,
and incidents are governed by law and not
or both, in the discretion of the court. subject to stipulation, except that marriage

Sec. 15. Confidential Nature of Proceedings and

Records. All hearings in adoption cases shall be If the court finds that the disclosure of the
confidential and shall not be open to the public. All information to a third person is necessary for purposes
records, books, and papers relating to the adoption connected with or arising out of the adoption and will
cases in the files of the court, the Department, or any be for the best interest of the adoptee, the court may
other agency or institution participating in the adoption merit the necessary information to be released,
proceedings shall be kept strictly confidential. restricting the purposes for which it may be used.

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Professor Ruben F. Balane Page 16 of 241
settlements may fix the property relations c. Marriage ceremony
during the marriage within the limits provided 3 terms
by this Code. 1. Absence
General Rule: The absence of either an
Marriage is a contract. It is a contract and much essential or formal requisite makes the
more. It is a contract of permanent union between a marriage void.
man and a woman. A contract of marriage unlike Exceptions:
other contracts confers status. a. Article 35, paragraph 2 (party believes
The primordial purpose of marriage is the in good faith that the solemnizing officer has
establishment of family life. authority)
Generally in contracts, the parties are free to enter
into contractual stipulations. However, in a Art. 35. The following
marriage contract parties are generally not free to marriages shall be void from the
enter into contractual stipulations. All the beginning:
consequences of marriage are determined by law. (2) Those solemnized by any person not
The only area in which the parties may stipulate is legally authorized to perform
with regard to property relations as long as these marriages unless such marriages were
stipulations are not contrary to law. In fact, the contracted with either or both parties
parties are not limited to the 3 major regimes in the believing in good faith that the
Family Code. solemnizing officer had the legal
authority to do so;
Art. 2. No marriage shall be valid, unless
these essential requisites are present: b. Marriages exempted from marriage
(1) Legal capacity of the contracting parties license (Articles 27, 28, 31, 32, 33, 34)
who must be a male and a female; and
(2) Consent freely given in the presence of Art. 27. In case either or both
the solemnizing officer. of the contracting parties are at the
point of death, the marriage may be
Art. 3. The formal requisites of marriage solemnized without necessity of a
are: marriage license and shall remain
(1) Authority of the solemnizing officer; valid even if the ailing party
(2) A valid marriage license except in the subsequently survives.
cases provided for in Chapter 2 of this
Title; and Art. 28. If the residence of
(3) A marriage ceremony which takes place either party is so located that there is
with the appearance of the contracting no means of transportation to enable
parties before the solemnizing officer such party to appear personally
and their personal declaration that they before the local civil registrar, the
take each other as husband and wife in marriage may be solemnized without
the presence of not less than two necessity of a marriage license.
witnesses of legal age.
Art. 31. A marriage in articulo
Art. 4. The absence of any of the essential mortis between passengers or crew
or formal requisites shall render the marriage members may also be solemnized by a
void ab initio, except as stated in Article 35 (2). ship captain or by an airplane pilot
A defect in any of the essential requisites not only while the ship is at sea or the
shall not affect the validity of the marriage but plane is in flight, but also during
the party or parties responsible for the stopovers at ports of call.
irregularity shall be civilly, criminally and
administratively liable. Art. 32. A military commander
of a unit, who is a commissioned
2 Kinds of Elements officer, shall likewise have authority
1. Essential to solemnize marriages in articulo
a. Legal capacity (included in legal capacity is mortis between persons within the
the difference in sex) zone of military operation, whether
b. Consent members of the armed forces or
2. Formal civilians.
a. Authority of the solemnizing Officer
b. Valid marriage license

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Professor Ruben F. Balane Page 17 of 241
 Art. 33. Marriages among The absence of this requisite makes the
Muslims or among members of the marriage void.
ethnic cultural communities may be
performed validly without the Art. 39. The action or defense for
necessity of marriage license, the declaration of absolute nullity shall
provided they are solemnized in not prescribe.
accordance with their customs, rites
or practices. The period to have the marriage declared
void is imprescriptible, the element being
Art. 34. No license shall be essential.
necessary for the marriage of a man
and a woman who have lived together B. Some Form of Ceremony (Articles 3(3), 4 1,
as husband and wife for at least five 6, 8)
years and without any legal
impediment to marry each other. The Art. 3. The formal requisites of
contracting parties shall state the marriage are:
foregoing facts in an affidavit before (3) A marriage ceremony which
any person authorized by law to takes place with the appearance
administer oaths. The solemnizing of the contracting parties before
officer shall also state under oath that the solemnizing officer and their
he ascertained the qualifications of personal declaration that they
the contracting parties are found no take each other as husband and
legal impediment to the marriage. wife in the presence of not less
than two witnesses of legal age.
2. Defect
Defect occurs in essential requisites alone. Art. 4. The absence of any of the
Fairly well-defined since there are many essential or formal requisites shall
specific articles. render the marriage void ab initio, except
Effect: Marriage is voidable as stated in Article 35 (2).
3. Irregularity
Irregularity refers to formal requisites alone Art. 6. No prescribed form or
No enumeration as to irregularity unlike religious rite for the solemnization of the
defect marriage is required. It shall be
Effects: necessary, however, for the contracting
a. Valid marriage parties to appear personally before the
b. Party responsible for irregularity may be solemnizing officer and declare in the
held liable presence of not less than two witnesses of
legal age that they take each other as
A. Difference in Sex (Articles 2(1), 4 1, 39) husband and wife. This declaration shall
be contained in the marriage certificate
Art. 2 (1). No marriage shall be which shall be signed by the contracting
valid, unless these essential requisites are parties and their witnesses and attested
present: by the solemnizing officer.
(1) Legal capacity of the contracting In case of a marriage in articulo
parties who must be a male and a mortis, when the party at the point of
female; death is unable to sign the marriage
certificate, it shall be sufficient for one of
Difference in sex is explicitly the witnesses to the marriage to write the
required for the first time. It was necessary name of said party, which fact shall be
to make this explicit since some jurisdictions attested by the solemnizing officer.
allow same sex marriages.
The following are the barest minimum
Art. 4. The absence of any of the required:
essential or formal requisites shall 1. Personal appearance of parties before
render the marriage void ab initio, except the solemnizing officer
as stated in Article 35 (2). 2. Declaration that they take each other as
husband and wife (manifestation of
intent)

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Professor Ruben F. Balane Page 18 of 241
 The law does not require a specific ceremony mentioned in Articles 37 and 38, may
neither does it require specific words or contract marriage.
symbols.
Marriages by proxy are NOT ALLOWED For both male and female, the minimum
since the contracting parties must personally age is 18.
appear before the solemnizing officer.
The intent (their declaration that they each Art. 35. The following
other as husband and wife) may be marriages shall be void from the
manifested in any form (i.e., words, beginning:
gestures, etc.). In the case of Martinez vs. (1) Those contracted by any
Tan, the intent was manifested in writing. party below eighteen years of
Some commentaries say that the 2 witnesses age even with the consent of
must be of legal age. Others say they need parents or guardians;
not be of legal age. To be safe, the witnesses
should be of legal age. If any contracting party is below 18, the
marriage is void.
Art. 8. The marriage shall be
solemnized publicly in the chambers of Art. 39. The action or defense
the judge or in open court, in the church, for the declaration of absolute nullity
chapel or temple, or in the office the shall not prescribe.
consul-general, consul or vice-consul, as
the case may be, and not elsewhere, The period to have the marriage
except in cases of marriages contracted declared void shall not prescribe.
on the point of death or in remote places
in accordance with Article 29 of this Art. 45. A marriage may be
Code, or where both of the parties request annulled for any of the following
the solemnizing officer in writing in causes, existing at the time of the
which case the marriage may be marriage:
solemnized at a house or place designated (1) That the party in whose
by them in a sworn statement to that behalf it is sought to have the
effect. marriage annulled was
eighteen years of age or over
C. Legal Capacity (Article 2(1)) but below twenty-one, and
the marriage was solemnized
Art. 2. No marriage shall be valid, without the consent of the
unless these essential requisites are parents, guardian or person
present: having substitute parental
(1) Legal capacity of the contracting authority over the party, in
parties who must be a male and a that order, unless after
female; attaining the age of twenty-
one, such party freely
1. Age (Articles 5, 35(1), 39, 45(1), 37(1)) cohabited with the other and
both lived together as
Art. 5. Any male or female of husband and wife;
the age of eighteen years or upwards
not under any of the impediments Art. 47. The action for
annulment of marriage must be filed

by the following persons and within

Art. 29. In the cases provided for in the two the periods indicated herein:
preceding articles, the solemnizing officer shall state in (1) For causes mentioned in
an affidavit executed before the local civil registrar or
number 1 of Article 45 by the
any other person legally authorized to administer oaths
party whose parent or
that the marriage was performed in articulo mortis or
guardian did not give his or
that the residence of either party, specifying the barrio
her consent, within five years
or barangay, is so located that there is no means of
transportation to enable such party to appear
after attaining the age of
personally before the local civil registrar and that the twenty-one, or by the parent
officer took the necessary steps to ascertain the ages or guardian or person having
and relationship of the contracting parties and the legal charge of the minor, at
absence of legal impediment to the marriage. any time before such party

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Professor Ruben F. Balane Page 19 of 241
 has reached the age of (2) Between step-parents and
twenty-one; step-children;
(3) Between parents-in-law and
Despite R.A. No. 6809, parental consent children-in-law;
is required for a contracting party who (4) Between the adopting parent
has not yet reached 21. and the adopted child;
Article 47(1) tells us who can set aside (5) Between the surviving spouse
the marriage which is voidable for lack of the adopting parent and
of the necessary parental consent. The the adopted child;
parent who did not give he necessary (6) Between the surviving spouse
parental consent until such child of the adopted child and the
reaches the age of 26. adopter;
However in Article 45(1), ratification of (7) Between an adopted child
the marriage is possible if the party who and a legitimate child of the
needed parental consent cohabits with adopter;
the other spouse. Ratification may only (8) Between adopted children of
occur after such party reaches 21. the same adopter;
Once the marriage has been ratified, the
parents cannot annul under this ground. Article 38 (1) refers to uncles, aunts and
If the parents filed the annulment before first cousins
their child reached 21, but upon Article 38 (3) is a new provision
reaching 21, their child cohabits, the marriage between parents-in-law and
action to annul the marriage continues. children-in-law
What would be determinative in such a Articles 38 (5) and 38 (6) are provided
situation is the time of filing. for to guard against scandal marriage
The capacitated person or his parents between the surviving spouse of the
may not have the marriage annulled for adopting parent and the adopted child;
lack of parental consent. marriage between the surviving spouse
of the adopted child and adopter.
2. Relationship (Articles 37, 38 (1-8), 39) Article 38 (8) prohibits the marriage
between adopted children of the same
Art. 37. Marriages between the adopter while Art. 38 (7) prohibits the
following are incestuous and void marriage between an adopted child and
from the beginning, whether a legitimate child of the adopted. What
relationship between the parties be is not prohibited are the following:
legitimate or illegitimate: 1. Marriage between an adopted child
(1) Between ascendants and and an illegitimate child of the
descendants of any degree; adopter.
and 2. Marriage between stepchildren
(2) Between brothers and
sisters, whether of the full or Art. 39. The action or defense
half blood. for the declaration of absolute nullity
shall not prescribe.
Incestuous Relationship
1. In the direct line, in any degree no The period to have the marriage
limit declared void shall not prescribe.
2. 2nd degree collaterals (brothers &
sisters) whether full or half blood, 3. Prior Marriage (Articles 35 (4), 35 (6),
legitimate or illegitimate 40, 41, 42, 43, 44, 52, 53 & 39)

Art. 38. The following The following are marriages

marriages shall be void from the which are defective because of a prior
beginning for reasons of public policy: marriage:
(1) Between collateral blood a. Bigamous or polygamous
relatives whether legitimate marriages not falling under
or illegitimate, up to the Article 41
fourth civil degree; Art. 35. The following
marriages shall be void from
the beginning:

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Professor Ruben F. Balane Page 20 of 241
 (4) Those bigamous or determined in case such fact is
polygamous disputed.
marriages not falling
under Article 41; Requisites of a marriage under
If the marriage falls under Article 41:
Article 41, the marriage is valid. 1. Absence of a prior spouse for at least
Art. 41. A marriage 4 consecutive years or 2 consecutive
contracted by any person years if the circumstances fall under
during subsistence of a Art. 391.
previous marriage shall be null 2. Spouse presents a well-founded
and void, unless before the belief that the absent spouse was
celebration of the subsequent already dead
marriage, the prior spouse had 3. Institution by the present spouse of
been absent for four a summary proceeding for the
consecutive years and the declaration of presumptive death.
spouse present has a well- Rules for marriages under Article 41
founded belief that the absent 1. The marriage is valid until it is
spouse was already dead. In terminated under Article 42 (Note:
case of disappearance where The term terminated and not
there is danger of death under annulled is used since the 2nd
the circumstances set forth in marriage is not a defective but a
the provisions of Article 391 of regular marriage)
the Civil Code, an absence of 2. General Rule: The termination of
only two years shall be the 2nd marriage takes effect upon
sufficient. the recording of the affidavit of
For the purpose of reappearance of the absent spouse.
contracting the subsequent 3. Exception: There is no
marriage under the preceding termination of the 2nd marriage if
paragraph the spouse present there is a judgment of annulment or
must institute a summary nullity with regard to the 1st
proceeding as provided in this marriage.
Code for the declaration of Any interested party may case the
presumptive death of the recording of the affidavit of
absentee, without prejudice to reappearance (i.e., present spouse,
the effect of reappearance of absent spouse, subsequent spouse,
the absent spouse. children)
The affidavit of reappearance should
Art. 42. The subsequent contain the facts and circumstances
marriage referred to in the of appearance
preceding Article shall be The affidavit of reappearance must
automatically terminated by be recorded in the civil registry of
the recording of the affidavit of the residence of the parties to the
reappearance of the absent subsequent marriage.
spouse, unless there is a Effectiveness: The affidavit of
judgment annulling the reappearance is sufficient in itself
previous marriage or declaring unless it is judicially challenged.
it void ab initio.
A sworn statement of Art. 43. The
the fact and circumstances of termination of the subsequent
reappearance shall be marriage referred to in the
recorded in the civil registry of preceding Article shall produce
the residence of the parties to the following effects:
the subsequent marriage at the (1) The children of the subsequent
instance of any interested marriage conceived prior to its
person, with due notice to the termination shall be
spouses of the subsequent considered legitimate;
marriage and without (2) The absolute community of
prejudice to the fact of property or the conjugal
reappearance being judicially partnership, as the case may

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Professor Ruben F. Balane Page 21 of 241
 be, shall be dissolved and favor of the other are revoked
liquidated, but if either spouse by operation of law.
contracted said marriage in
bad faith, his or her share of b. Void under Article 40
the net profits of the
community property or Art. 40. The absolute
conjugal partnership property nullity of a previous marriage may
shall be forfeited in favor of the be invoked for purposes of
common children or, if there remarriage on the basis solely of a
are none, the children of the final judgment declaring such
guilty spouse by a previous previous marriage void.
marriage or in default of
children, the innocent spouse; Even if the 1st marriage is void, there is
(3) Donations by reason of still a need for a summary proceeding
marriage shall remain valid, declaring such marriage void ab initio.
except that if the donee Thus, if a 2nd marriage is contracted
contracted the marriage in bad without first securing the declaration of
faith, such donations made to nullity with regard to the 1 st marriage,
said donee are revoked by then the 2nd marriage is also void. Plus,
operation of law; bigamy has been committed.
(4) The innocent spouse may
revoke the designation of the c. Void under Article 53 (in relation
other spouse who acted in bad to Article 52)
faith as beneficiary in any
insurance policy, even if such Art. 35. The following
designation be stipulated as marriages shall be void from the
irrevocable; and beginning:
(5) The spouse who contracted the (6) Those subsequent marriages that
subsequent marriage in bad are void under Article 53.
faith shall be disqualified to
inherit from the innocent Art. 52. The judgment of
spouse by testate and intestate annulment or of absolute nullity of
succession. the marriage, the partition and
distribution of the properties of
Effects: the spouses and the delivery of the
1. Essentially, 1st marriage continues. children's presumptive legitimes
2. According to Article 43 (5), the shall be recorded in the
spouse who contracted the appropriate civil registry and
subsequent marriage in bad faith registries of property; otherwise,
shall be disqualified to inherit from the same shall not affect third
the innocent spouse testate and persons.
intestate succession. Therefore, the
implication sis that if the parties are Art. 53. Either of the
in good faith, they are still heirs of former spouses may marry again
each other. Professor Balane after compliance with the
doesnt agree with this. According requirements of the immediately
to Professor Balane, if the 2nd preceding Article; otherwise, the
marriage is terminated, it should subsequent marriage shall be null
follow that the parties to the second and void.
marriage lose their right to be heirs
of each other. Despite declaration of annulment or
nullity of the marriage, before the
Art. 44. If both spouses former spouses may contract a
of the subsequent marriage subsequent marriage, the following
acted in bad faith, said must be recorded in the appropriate civil
marriage shall be void ab initio registry and registries of property:
and all donations by reason of 1. Judgment of annulment or of absolute
marriage and testamentary nullity
dispositions made by one in

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Professor Ruben F. Balane Page 22 of 241
 2. Partition and distribution of the
properties of the spouses
3. Delivery of the childrens presumptive
legitime
If the preceding tasks are not
accomplished, then any subsequent
marriage is void.

Art. 39. The action or

defense for the declaration of
absolute nullity shall not
prescribe.

The period to have the marriage

declared void shall not prescribe.

4. Crime (Article 38 (9))

Art. 38. The following

marriages shall be void from the
beginning for reasons of public policy:
(9) Between parties where one,
with the intention to marry
the other, killed that other
person's spouse, or his or her
own spouse.

2 changes from Article 80 (6) of the Civil

Code
1. Intention for killing must be in
order to marry the surviving spouse
2. No conviction is required.
Article 38 (9) excludes killing thru
negligence since there is no intent to kill.
The difficulty in Article 38 (9) is proving
that the reason for killing is to enable
the killer and the surviving spouse to
marry each other.

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Professor Ruben F. Balane Page 23 of 241
 5. Physical Incapacity (Articles 45 (5), 47 A marriage which is defective because of
(5)) a partys impotence cannot be ratified.
Ratification means cohabitation with
Art. 45. A marriage may be sexual intercourse.
annulled for any of the following
causes, existing at the time of the 6. Psychological Incapacity (Article 36)
marriage:
(5) That either party was Art. 36. A marriage contracted
physically incapable of by any party who, at the time of the
consummating the marriage celebration, was psychologically
with the other, and such incapacitated to comply with the
incapacity continues and essential marital obligations of
appears to be incurable; or marriage, shall likewise be void even
if such incapacity becomes manifest
Art. 47. The action for only after its solemnization.
annulment of marriage must be filed
by the following persons and within Psychological incapacity is not a
the periods indicated herein: substitute for divorce. The theory
(5) For causes mentioned in behind psychological incapacity is that
number 5 and 6 of Article 45, one or both of the spouses cannot
by the injured party, within discharge one or more of the essential
five years after the marriage. marital obligations (Article 68). There
must be an absolute incapability to do
These articles refer to impotence and so.
not sterility. During the 1st years of the effectivity of
Men and women are capable of the Family Code, many couples resorted
impotence. For men, there is impotence to Article 36 as a convenient way to end
when they cannot erect. For women, their marriage. As a result of these
impotence occurs when penetration is abuses, the Supreme Court became very
not possible an anatomical disorder. strict in applying Article 36.
For men, impotence may have physical Psychological incapacity must exist at
or psychological causes. the time the marriage is celebrated (like
Requisites of Annulment Due to impotence). However, psychological
Impotence incapacity need not be manifested at the
1. Impotence exists at the time of the time of the celebration of the marriage.
celebration of the marriage This is the tricky part.
2. The impotence is permanent and In Santos vs. CA, the Supreme Court
incurable (need medical opinion) enumerated the following characteristics
3. The impotence is unknown to the of psychological incapacity:
other spouse. 1. Gravity
4. The other spouse must also not be 2. Juridical antecedence
impotent. 3. Incurability
In some jurisdictions, there is a In Republic vs. CA (Molina), the
presumption that if after 3 years of Supreme Court reiterated Santos vs. CA.
marriage and it is found that the woman Furthermore, the Supreme Court laid
is still a virgin and suffers no anatomical down several guidelines:
defects, it is presumed that the man is 1. The burden of proof to show the
impotent. There is no Philippine case nullity of the marriage belongs to
stating that this presumption also the plaintiff. Any doubts should be
applies in the Philippines. (This is resolved in favor of the existence
known as the Doctrine of Triennial and continuation of the marriage
Cohabitation) and against the dissolution and
What if the man is impotent only with nullity.
regard to his wife? There is no case yet. 2. The root cause of the psychological
The action for annulment due to incapacity must be:
impotence must be filed by the injured a. Psychological and not physical
party within 5 years after the marriage. (although psychological
incapacity can be manifested
physically)

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Professor Ruben F. Balane Page 24 of 241
 b. Medically or clinically identified by the following persons and within
c. Alleged in the complaint the periods indicated herein:
d. Proved sufficiently by experts (5) For causes mentioned in
(i.e. psychiatrists, psychologists) number 5 and 6 of Article 45,
e. Clearly explained in the decision by the injured party, within
3. The incapacity must be proven to be five years after the marriage.
existing at the time of the
celebration of the marriage. Requisites for Annulment due to disease
4. Such incapacity must also be shown 1. Either party is afflicted with a
to be medically or clinically sexually transmissible disease (STD)
permanent or incurable. 2. The STD must exist at the time the
5. Such illness must be grave enough marriage is celebrated
to bring about the disability of the 3. The STD must be serious
party to assume the essential 4. The STD must be apparently
obligations of marriage incurable.
6. The essential marital obligations 5. The STD party not afflicted by STD
must be those embraced by Articles must be ignorant of the others
60 to 71 of the Family Code as affliction (Professor Balanes
regards the husband and wife, as opinion)
well as Articles 220, 221 and 225 of 6. The injured party must be free from
the same Code in regard to parents STD (Professor Balanes opinion)
and their children. Such non- According to Professor Balane, AIDS
complied marital obligations must would fall under Article 45 (6). Article
also be stated in the petition, proven 45(6) does not say that the only way to
by evidence and included in the test transmit the disease is through sex.
of the decision. Professor Balane is not sure if it is
7. Interpretations given by the required that the afflicted person should
National Appellate Matrimonial know that he has STD.
Tribunal of the Catholic Church in The injured party must be ignorant of
the Philippines, while not the other partys affliction. If the
controlling or decisive, should be injured party knew and the marriage
given great respect by our courts. took place, then the injured party has no
8. The trial court must order the right to complain.
prosecuting attorney or fiscal and The action to annul the marriage must
the Solicitor General to appear as take place within 5 years from the
counsel for the State. The Solicitor marriage.
Generals role is to issue a
The Family Code does not state if such a
certification stating why he does or
marriage can be ratified. Professor
does not agree.
Balane doesnt see why such a marriage
In Chi Ming Tsoi vs. CA, the cannot be ratified.
convergence of all the factors stated in
the complaint amounted to D. Consent
psychological incapacity.
1. Insanity (Articles 45(2), 47(2))
7. Disease (Articles 45 (6), 47 (5))
Art. 45. A marriage may be
Art. 45. A marriage may be annulled for any of the following
annulled for any of the following causes, existing at the time of the
causes, existing at the time of the marriage:
marriage: (2) That either party was of
(6) That either party was unsound mind, unless such
afflicted with a sexually- party after coming to reason,
transmissible disease found freely cohabited with the
to be serious and appears to other as husband and wife;
be incurable.
Art. 47. The action for
Art. 47. The action for annulment of marriage must be filed
annulment of marriage must be filed by the following persons and within
the periods indicated herein:

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Professor Ruben F. Balane Page 25 of 241
 (2) For causes mentioned in (1) Non-disclosure of a previous
number 2 of Article 45, by the conviction by final judgment
same spouse, who had no of the other party of a crime
knowledge of the other's involving moral turpitude;
insanity; or by any relative or (2) Concealment by the wife of
guardian or person having the fact that at the time of the
legal charge of the insane, at marriage, she was pregnant
any time before the death of by a man other than her
either party, or by the insane husband;
spouse during a lucid interval (3) Concealment of sexually
or after regaining sanity; transmissible disease,
regardless of its nature,
Insanity is a legal and not a medical existing at the time of the
question. marriage; or
One of the spouses must be insane at the (4) Concealment of drug
time the marriage was celebrated. addiction, habitual
However, Professor Balane cannot alcoholism or homosexuality
imagine anyone marrying an insane or lesbianism existing at the
person and not knowing it. time of the marriage.
The following are the prescriptive No other misrepresentation or
periods for filing: deceit as to character, health, rank,
1. At any time before the death of fortune or chastity shall constitute
either party such fraud as will give grounds for
With regard to the same spouse action for the annulment of marriage.
who had no knowledge of the
others sanity or by any relative, Fraud here is not the fraud founding
guardian or person having legal contracts and obligations. Fraud here
charge of the insane has a very technical meaning Article
2. During a lucid interval or after 46.
regaining sanity with regard to the Article 46 is an EXCLUSIVE LIST.
insane party. Articles 46 (1) and (2) are clear. In
Queries: Article 46 (3), the STD need not be
1. Up to what relatives (degree) can file serious or incurable. As long as the
the action for annulment? STD, existing at the time of marriage, is
2. How long exactly does the insane concealed, it constitutes fraud.
spouse have to file for annulment Article 46 (4), must the homosexual be a
during a lucid interval or recovery? practicing homosexual or is such sexual
Ratification by the insane spouse is orientation enough under here? There
possible (i.e., during a lucid interval, the is no jurisprudence yet.
insane spouse cohabits) The injured party has 5 years from the
time the fraud was discovered to file for
2. Fraud (Articles 45 (3), 46) annulment.
A marriage which is defective due to
Art. 45. A marriage may be fraud may be ratifies. Ratification
annulled for any of the following occurs when the injured party freely
causes, existing at the time of the cohabits with the other despite having
marriage: full knowledge of the facts constituting
(3) That the consent of either party fraud.
was obtained by fraud, unless In Buccat vs. Buccat, the Supreme Court
such party afterwards, with full said that there was no concealment by
knowledge of the facts the wife of the fact that she was
constituting the fraud, freely pregnant with another mans child.
cohabited with the other as There was no concealment since at the
husband and wife; time of marriage, she was already in her
6th month.
Art. 46. Any of the following
circumstances shall constitute fraud 3. Duress force, intimidation or undue
referred to in Number 3 of the influence (Articles 45 (4), 47 (4))
preceding Article:

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Professor Ruben F. Balane Page 26 of 241
 Art. 3. The formal requisites of
Art. 45. A marriage may be marriage are:
annulled for any of the following (1) Authority of the solemnizing
causes, existing at the time of the officer;
marriage:
(4) That the consent of either Art. 4. The absence of any of the
party was obtained by force, essential or formal requisites shall
intimidation or undue render the marriage void ab initio, except
influence, unless the same as stated in Article 35 (2).
having disappeared or
ceased, such party thereafter Art. 7. Marriage may be
freely cohabited with the solemnized by:
other as husband and wife; (1) Any incumbent member of the
judiciary within the court's
Art. 47. The action for jurisdiction;
annulment of marriage must be filed (2) Any priest, rabbi, imam, or
by the following persons and within minister of any church or
the periods indicated herein: religious sect duly authorized by
(4) For causes mentioned in his church or religious sect and
number 4 of Article 45, by the registered with the civil registrar
injured party, within five general, acting within the limits
years from the time the force, of the written authority granted
intimidation or undue by his church or religious sect
influence disappeared or and provided that at least one of
ceased; the contracting parties belongs
to the solemnizing officer's
The injured party has 5 years from the church or religious sect;
time the force, intimidation or undue (3) Any ship captain or airplane
influence disappeared or ceased to file chief only in the case mentioned
for annulment. in Article 31;
Ratification occurs when the force, (4) Any military commander of a
intimidation or undue influence having unit to which a chaplain is
disappeared or ceased, the injured party assigned, in the absence of the
cohabits. latter, during a military
operation, likewise only in the
4. Mistake as to Identity (Articles 35 (5), cases mentioned in Article 32;
39) (5) Any consul-general, consul or
vice-consul in the case provided
Art. 35. The following in Article 10.
marriages shall be void from the
beginning: Article 7, enumerating those persons who
(5) Those contracted through may solemnize a marriage, has been
mistake of one contracting amended by the Local Government Code.
party as to the identity of the Now, municipal and city mayors have the
other; authority to solemnize a marriage.
Article 7(1), justices of the Supreme Court
Art. 39. The action or defense and Court of Appeals can solemnize
for the declaration of absolute nullity marriages anywhere in the Philippines.
shall not prescribe. Justices of the Regional Trial Courts and
Municipal/Metropolitan/Municipal Circuit
A marriage where there is mistake as to Trial Courts can only solemnize marriages
identity is a void marriage since consent within their territorial jurisdiction.
is completely negated.
Mistake as to identity involves the Art. 10. Marriages between
substitution of the other party. Filipino citizens abroad may be
solemnized by a consul-general, consul or
E. Authority of the Solemnizing Officer vice-consul of the Republic of the
(Articles 3 (1), 4 (1), 7, 10, 31, 32, 35 (2)) Philippines. The issuance of the marriage
license and the duties of the local civil

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Professor Ruben F. Balane Page 27 of 241
 registrar and of the solemnizing officer Art. 4. The absence of any of the
with regard to the celebration of marriage essential or formal requisites shall
shall be performed by said consular render the marriage void ab initio, except
official. as stated in Article 35 (2).
A defect in any of the essential
Art. 31. A marriage in articulo requisites shall not affect the validity of
mortis between passengers or crew the marriage but the party or parties
members may also be solemnized by a responsible for the irregularity shall be
ship captain or by an airplane pilot not civilly, criminally and administratively
only while the ship is at sea or the plane is liable.
in flight, but also during stopovers at
ports of call. Art. 35. The following marriages
shall be void from the beginning:
Art. 32. A military commander of (3) Those solemnized without
a unit, who is a commissioned officer, license, except those covered the
shall likewise have authority to solemnize preceding Chapter;
marriages in articulo mortis between
persons within the zone of military Art. 9. A marriage license shall be
operation, whether members of the issued by the local civil registrar of the
armed forces or civilians. city or municipality where either
contracting party habitually resides,
Art. 35. The following marriages except in marriages where no license is
shall be void from the beginning: required in accordance with Chapter 2 of
(2) Those solemnized by any person this Title.
not legally authorized to perform
marriages unless such marriages Art. 10. Marriages between
were contracted with either or Filipino citizens abroad may be
both parties believing in good solemnized by a consul-general, consul or
faith that the solemnizing officer vice-consul of the Republic of the
had the legal authority to do so; Philippines. The issuance of the marriage
license and the duties of the local civil
Article 35 (2), if one or both of the registrar and of the solemnizing officer
contracting parties believes in good faith with regard to the celebration of marriage
that the solemnizing officer had authority to shall be performed by said consular
do so even if such person was not official.
authorized, the marriage is not void but
valid. Art. 11. Where a marriage license
Good faith in Article 35 (2) refers to a is required, each of the contracting
question of fact. For example, the parties parties shall file separately a sworn
did not know that the license of the priest application for such license with the
had expired or that the judge had retired. If proper local civil registrar which shall
the parties thought that Ping Lacson had the specify the following:
authority marry them, that is not goof faith. (1) Full name of the contracting
That is ignorance of the law. The same is party;
also true if the parties believe that an RTC (2) Place of birth;
judge of Quezon City can marry them in (3) Age and date of birth;
Tawi-Tawi. That is an error of law. (4) Civil status;
(5) If previously married, how,
F. Marriage License (Articles 3 (2), 4 (1), 4 (3), when and where the previous
35 (3), 9 21[refers to the administrative marriage was dissolved or
requirements], 27 34) annulled;
(6) Present residence and
Art. 3. The formal requisites of citizenship;
marriage are: (7) Degree of relationship of the
(2) A valid marriage license except contracting parties;
in the cases provided for in (8) Full name, residence and
Chapter 2 of this Title; citizenship of the father;
(9) Full name, residence and
citizenship of the mother; and

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Professor Ruben F. Balane Page 28 of 241
 (10) Full name, residence and registrar concerned and swear to the
citizenship of the guardian or correctness of the lawful age of said
person having charge, in case parties, as stated in the application, or
the contracting party has when the local civil registrar shall, by
neither father nor mother and merely looking at the applicants upon
is under the age of twenty-one their personally appearing before him, be
years. convinced that either or both of them
The applicants, their parents or have the required age.
guardians shall not be required to exhibit
their residence certificates in any Art. 13. In case either of the
formality in connection with the securing contracting parties has been previously
of the marriage license. married, the applicant shall be required
to furnish, instead of the birth or
Art. 12. The local civil baptismal certificate required in the last
registrar, upon receiving such preceding article, the death certificate of
application, shall require the the deceased spouse or the judicial decree
presentation of the original birth of the absolute divorce, or the judicial
certificates or, in default thereof, the decree of annulment or declaration of
baptismal certificates of the contracting nullity of his or her previous marriage.
parties or copies of such documents duly In case the death certificate cannot
attested by the persons having custody of be secured, the party shall make an
the originals. These certificates or affidavit setting forth this circumstance
certified copies of the documents by this and his or her actual civil status and the
Article need not be sworn to and shall be name and date of death of the deceased
exempt from the documentary stamp tax. spouse.
The signature and official title of the
person issuing the certificate shall be Art. 14. In case either or both of
sufficient proof of its authenticity. the contracting parties, not having been
If either of the contracting parties emancipated by a previous marriage, are
is unable to produce his birth or between the ages of eighteen and twenty-
baptismal certificate or a certified copy of one, they shall, in addition to the
either because of the destruction or loss requirements of the preceding articles,
of the original or if it is shown by an exhibit to the local civil registrar, the
affidavit of such party or of any other consent to their marriage of their father,
person that such birth or baptismal mother, surviving parent or guardian, or
certificate has not yet been received persons having legal charge of them, in
though the same has been required of the the order mentioned. Such consent shall
person having custody thereof at least be manifested in writing by the interested
fifteen days prior to the date of the party, who personally appears before the
application, such party may furnish in proper local civil registrar, or in the form
lieu thereof his current residence of an affidavit made in the presence of
certificate or an instrument drawn up two witnesses and attested before any
and sworn to before the local civil official authorized by law to administer
registrar concerned or any public official oaths. The personal manifestation shall
authorized to administer oaths. Such be recorded in both applications for
instrument shall contain the sworn marriage license, and the affidavit, if one
declaration of two witnesses of lawful is executed instead, shall be attached to
age, setting forth the full name, residence said applications.
and citizenship of such contracting party
and of his or her parents, if known, and Art. 15. Any contracting party
the place and date of birth of such party. between the age of twenty-one and
The nearest of kin of the contracting twenty-five shall be obliged to ask their
parties shall be preferred as witnesses, parents or guardian for advice upon the
or, in their default, persons of good intended marriage. If they do not obtain
reputation in the province or the locality. such advice, or if it be unfavorable, the
The presentation of birth or marriage license shall not be issued till
baptismal certificate shall not be required after three months following the
if the parents of the contracting parties completion of the publication of the
appear personally before the local civil application therefor. A sworn statement

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Professor Ruben F. Balane Page 29 of 241
 by the contracting parties to the effect marriage license, but shall nonetheless
that such advice as been sought, together issue said license after the completion of
with the written advice given, if any, shall the period of publication, unless ordered
be attached to the application for otherwise by a competent court at his
marriage license. Should the parents or own instance or that of any interest party.
guardian refuse to give any advice, this No filing fee shall be charged for the
fact shall be stated in the sworn petition nor a corresponding bond
statement. required for the issuances of the order.

Art. 16. In the cases where Art. 19. The local civil registrar
parental consent or parental advice is shall require the payment of the fees
needed, the party or parties concerned prescribed by law or regulations before
shall, in addition to the requirements of the issuance of the marriage license. No
the preceding articles, attach a certificate other sum shall be collected in the nature
issued by a priest, imam or minister of a fee or tax of any kind for the issuance
authorized to solemnize marriage under of said license. It shall, however, be
Article 7 of this Code or a marriage issued free of charge to indigent parties,
counsellor duly accredited by the proper that is those who have no visible means of
government agency to the effect that the income or whose income is insufficient
contracting parties have undergone for their subsistence a fact established by
marriage counselling. Failure to attach their affidavit, or by their oath before the
said certificates of marriage counselling local civil registrar.
shall suspend the issuance of the
marriage license for a period of three Art. 20. The license shall be valid
months from the completion of the in any part of the Philippines for a period
publication of the application. Issuance of of one hundred twenty days from the date
the marriage license within the of issue, and shall be deemed
prohibited period shall subject the automatically cancelled at the expiration
issuing officer to administrative of the said period if the contracting
sanctions but shall not affect the validity parties have not made use of it. The
of the marriage. expiry date shall be stamped in bold
Should only one of the contracting characters on the face of every license
parties need parental consent or parental issued.
advice, the other party must be present at
the counselling referred to in the Art. 21. When either or both of the
preceding paragraph. contracting parties are citizens of a
foreign country, it shall be necessary for
Art. 17. The local civil registrar them before a marriage license can be
shall prepare a notice which shall contain obtained, to submit a certificate of legal
the full names and residences of the capacity to contract marriage, issued by
applicants for a marriage license and their respective diplomatic or consular
other data given in the applications. The officials.
notice shall be posted for ten consecutive Stateless persons or refugees from
days on a bulletin board outside the office other countries shall, in lieu of the
of the local civil registrar located in a certificate of legal capacity herein
conspicuous place within the building required, submit an affidavit stating the
and accessible to the general public. This circumstances showing such capacity to
notice shall request all persons having contract marriage.
knowledge of any impediment to the
marriage to advise the local civil registrar General Rule: A marriage license is
thereof. The marriage license shall be required.
issued after the completion of the period Exceptions:
of publication. 1. Marriages in articulo mortis
(Articles 27, 31, 32)
Art. 18. In case of any impediment
known to the local civil registrar or Art. 27. In case either or
brought to his attention, he shall note both of the contracting parties are
down the particulars thereof and his at the point of death, the marriage
findings thereon in the application for may be solemnized without

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Professor Ruben F. Balane Page 30 of 241
 necessity of a marriage license and if the male is Muslim. If only the female
shall remain valid even if the ailing is Muslim, then the Family Code
party subsequently survives. governs.

Art. 31. A marriage in 4. Couples living together as husband

articulo mortis between and wife for at least 5 years and
passengers or crew members may they must not have any legal
also be solemnized by a ship impediment to marry each other
captain or by an airplane pilot not (Article 34)
only while the ship is at sea or the
plane is in flight, but also during Art. 34. No license shall be
stopovers at ports of call. necessary for the marriage of a
man and a woman who have lived
Art. 32. A military together as husband and wife for
commander of a unit, who is a at least five years and without any
commissioned officer, shall legal impediment to marry each
likewise have authority to other. The contracting parties
solemnize marriages in articulo shall state the foregoing facts in an
mortis between persons within the affidavit before any person
zone of military operation, authorized by law to administer
whether members of the armed oaths. The solemnizing officer
forces or civilians. shall also state under oath that he
ascertained the qualifications of
Articles 31 and 32 are not distinct the contracting parties are found
exceptional marriages but marriages no legal impediment to the
in articulo mortis. marriage.

2. Residence is located such that Art. 29. In the cases

either party has no means of provided for in the two preceding
transportation to enable such articles, the solemnizing officer
party to appear before the Civil shall state in an affidavit executed
Registrar (Article 28) before the local civil registrar or
any other person legally
Art. 28. If the residence of authorized to administer oaths
either party is so located that there that the marriage was performed
is no means of transportation to in articulo mortis or that the
enable such party to appear residence of either party,
personally before the local civil specifying the barrio or barangay,
registrar, the marriage may be is so located that there is no means
solemnized without necessity of a of transportation to enable such
marriage license. party to appear personally before
the local civil registrar and that
3. Marriages among Muslims or the officer took the necessary steps
among members of ethnic cultural to ascertain the ages and
communities as long as they are relationship of the contracting
solemnized in accordance with parties and the absence of legal
their customs (Article 33) impediment to the marriage.

Art. 33. Marriages among II. Effect of Defective Marriages on the Status
Muslims or among members of the of Children
ethnic cultural communities may
be performed validly without the A. If the marriage is voidable (Article 54)
necessity of marriage license,
provided they are solemnized in Art. 54. Children conceived
accordance with their customs, or born before the judgment of
rites or practices. annulment or absolute nullity of the
marriage under Article 36 has become
NOTE: The Muslim Code governs if the final and executory shall be considered
contracting parties are both Muslims or legitimate. Children conceived or born of

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Professor Ruben F. Balane Page 31 of 241
 the subsequent marriage under Article 53 marriage provided for in Chapter 2 of
shall likewise be legitimate. this Title;
(5) That either or both of the contracting
Legitimate if conceived before final parties have secured the parental
judgment consent in appropriate cases;
Illegitimate - if conceived after final (6) That either or both of the contracting
judgment parties have complied with the legal
requirement regarding parental advice
B. If the marriage is void in appropriate cases; and
(7) That the parties have entered into
General Rule: Children are illegitimate marriage settlement, if any, attaching a
(Article 165) copy thereof.

Art. 165. Children conceived Art. 23. It shall be the duty of the person
and born outside a valid marriage are solemnizing the marriage to furnish either of the
illegitimate, unless otherwise contracting parties the original of the marriage
provided in this Code. certificate referred to in Article 6 and to send the
duplicate and triplicate copies of the certificate
Exceptions: Legitimate if the not later than fifteen days after the marriage, to
marriage falls under: the local civil registrar of the place where the
1. Article 36 Psychological incapacity marriage was solemnized. Proper receipts shall
be issued by the local civil registrar to the
Art. 36. A marriage solemnizing officer transmitting copies of the
contracted by any party who, at the marriage certificate. The solemnizing officer
time of the celebration, was shall retain in his file the quadruplicate copy of
psychologically incapacitated to the marriage certificate, the copy of the marriage
comply with the essential marital certificate, the original of the marriage license
obligations of marriage, shall and, in proper cases, the affidavit of the
likewise be void even if such contracting party regarding the solemnization of
incapacity becomes manifest only the marriage in place other than those
after its solemnization. mentioned in Article 8.

2. Article 53 Children conceived or A marriage certificate is proof of marriage. It is

born of the subsequent marriage under however not the only proof (i.e., witnesses)
Article 53 even though such marriage is
void for failure to comply with the IV. Additional Requirements for Annulment or
requirements of Article 52. Declaration of Nullity

Art. 53. Either of the Art. 48. In all cases of annulment or

former spouses may marry again declaration of absolute nullity of marriage, the
after compliance with the Court shall order the prosecuting attorney or
requirements of the immediately fiscal assigned to it to appear on behalf of the
preceding Article; otherwise, the State to take steps to prevent collusion between
subsequent marriage shall be null the parties and to take care that evidence is not
and void. fabricated or suppressed.
In the cases referred to in the preceding
III. Marriage Certificate (Articles 22 and 23) paragraph, no judgment shall be based upon a
stipulation of facts or confession of judgment.
Art. 22. The marriage certificate, in
which the parties shall declare that they take Prosecuting attorney or fiscal should:
each other as husband and wife, shall also state: 1. Take steps to prevent collusion between the
(1) The full name, sex and age of each parties
contracting party; 2. Take care that evidence is not fabricated or
(2) Their citizenship, religion and habitual suppressed
residence; NOTE: No judgment shall be based upon a stipulation of
(3) The date and precise time of the facts or confession of judgment.
celebration of the marriage;
(4) That the proper marriage license has Art. 52. The judgment of annulment or of
been issued according to law, except in absolute nullity of the marriage, the partition

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Professor Ruben F. Balane Page 32 of 241
and distribution of the properties of the spouses Art. 26, 2. Where a marriage between a
and the delivery of the children's presumptive Filipino citizen and a foreigner is validly
legitimes shall be recorded in the appropriate celebrated and a divorce is thereafter validly
civil registry and registries of property; obtained abroad by the alien spouse capacitating
otherwise, the same shall not affect third him or her to remarry, the Filipino spouse shall
persons. have capacity to remarry under Philippine law.

The following must be accomplished: General Rule: Foreign divorces obtained by

1. Partition and distribution of the properties of Filipino citizens will be considered void and are not
the spouses recognized.
2. Delivery of the childrens presumptive legitimes Exception: In case the parties to the marriage are
3. Recording of the judgment of annulment or of a Filipino citizen and a foreigner. If the foreigner
absolute nullity. The partition and distribution obtains a valid foreign divorce, the Filipino spouse
and the delivery of the childrens presumptive shall have capacity to re-marry under Philippine law.
legitimes in the appropriate civil registry and However, if it is the Filipino citizen who secures
registries of property. (Otherwise, the same shall the divorce, the divorce will not be recognized in
not affect 3rd persons) the Philippines.
Failure to comply with Article 52 shall render the Requisites of Article 26, 2
subsequent marriage null and void. 1. The marriage must be one between a Filipino
and a foreigner
V. Foreign Marriages and Foreign Divorces 2. Divorce is granted abroad
3. Divorce must have been obtained by the alien
Art. 26, 1. All marriages solemnized spouse.
outside the Philippines, in accordance with the 4. Divorce must capacitate the alien spouse to
laws in force in the country where they were remarry.
solemnized, and valid there as such, shall also be Article 26, 2 has a retroactive effect if no vested
valid in this country, except those prohibited rights are affected.
under Articles 35 (1), (4), (5) and (6), 3637 and Problem: Suppose at the time of the marriage,
38. both are Filipinos. Later on, one spouse is
naturalized. This spouse obtains a foreign divorce.
General Rule: Foreign marriages which are in Will Article 26, 2 apply?
accordance with the law in force in the country 2 views:
where they were solemnized and valid there are valid 1. Justice Puno
in the Philippines. It wont. Article 26, 2 requires that at the
Exception: Void marriages under Philippine Law time the marriage is celebrated, there must
Exception to the exception: be 1 foreigner.
1. Article 35, 2 2. DOJ Opinion
It applies, Article 26, 2 is not specific.
Art. 35. The following marriages
shall be void from the beginning: VI. Effects of a Defective Marriage
(2) Those solemnized by any person
not legally authorized to perform 1. Re-appearance of absent spouse
marriages unless such marriages The marriage is not really defective. Thus,
were contracted with either or the term terminated is used.
both parties believing in good Art. 52. The judgment of
faith that the solemnizing officer annulment or of absolute nullity of
had the legal authority to do so; the marriage, the partition and
distribution of the properties of the
2. Article 35, 3 spouses and the delivery of the
children's presumptive legitimes shall
Art. 35. The following marriages be recorded in the appropriate civil
shall be void from the beginning: registry and registries of property;
(3) Those solemnized without otherwise, the same shall not affect
license, except those covered the third persons.
preceding Chapter;
There must be partition and distribution of
the properties of the spouses and the
delivery of the childrens presumptive

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Professor Ruben F. Balane Page 33 of 241
 legitimes. This shall be recorded in the In the partition, the conjugal
appropriate registries of property. dwelling and the lot on which it is
situated, shall be adjudicated in
2. Annulment accordance with the provisions of
Articles 102 and 129.
Art. 52. The judgment of
annulment or of absolute nullity of the 4. Legal Separation
marriage, the partition and distribution See Articles 63 and 64 for the effects.
of the properties of the spouses and the
delivery of the children's presumptive Art. 63. The decree of legal
legitimes shall be recorded in the separation shall have the following
appropriate civil registry and registries of effects:
property; otherwise, the same shall not (1) The spouses shall be entitled
affect third persons. to live separately from each
other, but the marriage
There must be a partition and distribution of bonds shall not be severed;
the properties of the spouses and the (2) The absolute community or
delivery of the childrens presumptive the conjugal partnership
legitime, and the recording of such and the shall be dissolved and
judgment of nullity with the appropriate liquidated but the offending
civil registry and registries of property. spouse shall have no right to
any share of the net profits
Art. 53. Either of the former earned by the absolute
spouses may marry again after community or the conjugal
compliance with the requirements of the partnership, which shall be
immediately preceding Article; forfeited in accordance with
otherwise, the subsequent marriage shall the provisions of Article
be null and void. 43(2);
(3) The custody of the minor
Either of the former spouses may marry children shall be awarded to
again provided Article 52 is complied with. the innocent spouse, subject
to the provisions of Article
3. Declaration of Nullity 213 of this Code; and
This is not a defective marriage since there (4) The offending spouse shall be
was no marriage in the first place. disqualified from inheriting
Article 50 applies. from the innocent spouse by
intestate succession.
Art. 50. The effects provided Moreover, provisions in
for by paragraphs (2), (3), (4) and (5) favor of the offending spouse
of Article 43 and by Article 44 shall made in the will of the
also apply in the proper cases to innocent spouse shall be
marriages which are declared ab revoked by operation of law.
initio or annulled by final judgment
under Articles 40 and 45. Art. 64. After the finality of the
The final judgment in such decree of legal separation, the
cases shall provide for the liquidation, innocent spouse may revoke the
partition and distribution of the donations made by him or by her in
properties of the spouses, the custody favor of the offending spouse, as well
and support of the common children, as the designation of the latter as
and the delivery of third presumptive beneficiary in any insurance policy,
legitimes, unless such matters had even if such designation be stipulated
been adjudicated in previous judicial as irrevocable. The revocation of the
proceedings. donations shall be recorded in the
All creditors of the spouses as registries of property in the places
well as of the absolute community or where the properties are located.
the conjugal partnership shall be Alienations, liens and encumbrances
notified of the proceedings for registered in good faith before the
liquidation. recording of the complaint for
revocation in the registries of

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Professor Ruben F. Balane Page 34 of 241
 property shall be respected. The (2) The absolute community or the
revocation of or change in the conjugal partnership shall be
designation of the insurance dissolved and liquidated but the
beneficiary shall take effect upon offending spouse shall have no
written notification thereof to the right to any share of the net
insured. profits earned by the absolute
The action to revoke the community or the conjugal
donation under this Article must be partnership, which shall be
brought within five years from the forfeited in accordance with the
time the decree of legal separation provisions of Article 43(2);
become final.
VIII. Instances when there is Delivery of
VII. Rules on the Forfeiture of the Share of the Presumptive Legitimes
Guilty Spouse
1. Re-appearance of former spouse (Articles
1. Re-appearance of spouse (Article 43(2)) 102 (5), 43(2))

Art. 43. The termination of the Art. 102. Upon dissolution of the
subsequent marriage referred to in the absolute community regime, the
preceding Article shall produce the following procedure shall apply:
following effects: (5) The presumptive legitimes of the
(2) The absolute community of common children shall be
property or the conjugal delivered upon partition, in
partnership, as the case may be, accordance with Article 51.
shall be dissolved and liquidated,
but if either spouse contracted Art. 43. The termination of the
said marriage in bad faith, his subsequent marriage referred to in the
or her share of the net profits of preceding Article shall produce the
the community property or following effects:
conjugal partnership property (2) The absolute community of
shall be forfeited in favor of the property or the conjugal
common children or, if there are partnership, as the case may be,
none, the children of the guilty shall be dissolved and liquidated,
spouse by a previous marriage or but if either spouse contracted
in default of children, the said marriage in bad faith, his
innocent spouse; or her share of the net profits of
the community property or
The present spouse cannot be the one in bad conjugal partnership property
faith because in order to contract a shall be forfeited in favor of the
subsequent marriage, the present spouse common children or, if there are
must believe in good faith that the absent none, the children of the guilty
spouse is dead. spouse by a previous marriage or
in default of children, the
2. Annulment (Article 50(1)) innocent spouse;

Art. 50. The effects provided for 2. Annulment (Articles 50 2, 51)

by paragraphs (2), (3), (4) and (5) of
Article 43 and by Article 44 shall also Art. 50, 2. The final judgment in
apply in the proper cases to marriages such cases shall provide for the
which are declared ab initio or annulled liquidation, partition and distribution of
by final judgment under Articles 40 and the properties of the spouses, the custody
45. and support of the common children, and
the delivery of their presumptive
3. Legal Separation (Article 63(2)) legitimes, unless such matters had been
adjudicated in previous judicial
Art. 63. The decree of legal proceedings.
separation shall have the following
effects: Art. 51. In said partition, the value
of the presumptive legitimes of all

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Professor Ruben F. Balane Page 35 of 241
 common children, computed as of the for the unpaid balance with their
date of the final judgment of the trial separate properties in
court, shall be delivered in cash, property accordance with the provisions
or sound securities, unless the parties, by of the second paragraph of
mutual agreement judicially approved, Article 94.
had already provided for such matters. (3) Whatever remains of the
The children or their guardian or exclusive properties of the
the trustee of their property may ask for spouses shall thereafter be
the enforcement of the judgment. delivered to each of them.
The delivery of the presumptive (4) The net remainder of the
legitimes herein prescribed shall in no properties of the absolute
way prejudice the ultimate successional community shall constitute its
rights of the children accruing upon the net assets, which shall be divided
death of either of both of the parents; but equally between husband and
the value of the properties already wife, unless a different
received under the decree of annulment proportion or division was
or absolute nullity shall be considered as agreed upon in the marriage
advances on their legitime. settlements, or unless there has
been a voluntary waiver of such
3. Legal Separation (Articles 102 (5), 63(2)) share provided in this Code. For
purpose of computing the net
Art. 102. Upon dissolution of the profits subject to forfeiture in
absolute community regime, the accordance with Articles 43, No.
following procedure shall apply: (2) and 63, No. (2), the said
(5) The presumptive legitimes of the profits shall be the increase in
common children shall be value between the market value
delivered upon partition, in of the community property at the
accordance with Article 51. time of the celebration of the
marriage and the market value at
Art. 63. The decree of legal the time of its dissolution.
separation shall have the following (5) The presumptive legitimes of the
effects: common children shall be
(2) The absolute community or the delivered upon partition, in
conjugal partnership shall be accordance with Article 51.
dissolved and liquidated but the (6) Unless otherwise agreed upon by
offending spouse shall have no the parties, in the partition of the
right to any share of the net properties, the conjugal dwelling
profits earned by the absolute and the lot on which it is situated
community or the conjugal shall be adjudicated to the
partnership, which shall be spouse with whom the majority
forfeited in accordance with the of the common children choose
provisions of Article 43(2); to remain. Children below the
age of seven years are deemed to
4. Other causes for the dissolution of have chosen the mother, unless
conjugal property (Articles 102, 129, 135) the court has decided otherwise.
In case there in no such
Art. 102. Upon dissolution of the majority, the court shall decide,
absolute community regime, the taking into consideration the
following procedure shall apply: best interests of said children.
(1) An inventory shall be prepared,
listing separately all the Art. 129. Upon the
properties of the absolute dissolution of the conjugal partnership
community and the exclusive regime, the following procedure shall
properties of each spouse. apply:
(2) The debts and obligations of the (1) An inventory shall be prepared,
absolute community shall be listing separately all the
paid out of its assets. In case of properties of the conjugal
insufficiency of said assets, the partnership and the exclusive
spouses shall be solidarily liable properties of each spouse.

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Professor Ruben F. Balane Page 36 of 241
 (2) Amounts advanced by the to remain. Children below the
conjugal partnership in payment age of seven years are deemed to
of personal debts and obligations have chosen the mother, unless
of either spouse shall be credited the court has decided otherwise.
to the conjugal partnership as an In case there is no such majority,
asset thereof. the court shall decide, taking
(3) Each spouse shall be reimbursed into consideration the best
for the use of his or her exclusive interests of said children.
funds in the acquisition of
property or for the value of his Art. 135. Any of the following shall
or her exclusive property, the be considered sufficient cause for judicial
ownership of which has been separation of property:
vested by law in the conjugal (1) That the spouse of the petitioner
partnership. has been sentenced to a penalty
(4) The debts and obligations of the which carries with it civil
conjugal partnership shall be interdiction;
paid out of the conjugal assets. (2) That the spouse of the petitioner
In case of insufficiency of said has been judicially declared an
assets, the spouses shall be absentee;
solidarily liable for the unpaid (3) That loss of parental authority of
balance with their separate the spouse of petitioner has been
properties, in accordance with decreed by the court;
the provisions of paragraph (2) (4) That the spouse of the petitioner
of Article 121. has abandoned the latter or
(5) Whatever remains of the failed to comply with his or her
exclusive properties of the obligations to the family as
spouses shall thereafter be provided for in Article 101;
delivered to each of them. (5) That the spouse granted the
(6) Unless the owner had been power of administration in the
indemnified from whatever marriage settlements has abused
source, the loss or deterioration that power; and
of movables used for the benefit (6) That at the time of the petition,
of the family, belonging to either the spouses have been separated
spouse, even due to fortuitous in fact for at least one year and
event, shall be paid to said reconciliation is highly
spouse from the conjugal funds, improbable.
if any. In the cases provided for in
(7) The net remainder of the Numbers (1), (2) and (3), the presentation
conjugal partnership properties of the final judgment against the guilty or
shall constitute the profits, absent spouse shall be enough basis for
which shall be divided equally the grant of the decree of judicial
between husband and wife, separation of property.
unless a different proportion or
division was agreed upon in the 5. Decree of Nullity (Article 502)
marriage settlements or unless
there has been a voluntary Art. 50. The final judgment in
waiver or forfeiture of such such cases shall provide for the
share as provided in this Code. liquidation, partition and distribution of
(8) The presumptive legitimes of the the properties of the spouses, the custody
common children shall be and support of the common children, and
delivered upon the partition in the delivery of third presumptive
accordance with Article 51. legitimes, unless such matters had been
(9) In the partition of the properties, adjudicated in previous judicial
the conjugal dwelling and the lot proceedings.
on which it is situated shall,
unless otherwise agreed upon by Professor Balane is not in favor of the
the parties, be adjudicated to the delivery of presumptive legitimes.
spouse with whom the majority Presumptive legitimes are tentative.
of the common children choose Furthermore, the properties of the spouses

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Professor Ruben F. Balane Page 37 of 241
 are frozen, yet the children do not have In Gandionco vs. Pearanda, the Supreme Court
vested rights. said that a criminal conviction of concubinage is not
necessary, only preponderance of evidence. In fact,
IX. Legal Separation (Bed and Board Separation) a civil action for legal separation based on
concubinage may proceed ahead of or
Art. 55. A petition for legal separation simultaneously with a criminal action.
may be filed on any of the following grounds: Sexual perversion is a relative term.
(1) Repeated physical violence or grossly
abusive conduct directed against the (9) Attempt by the respondent against the
petitioner, a common child, or a child of life of the petitioner; or
the petitioner;
Article 55 (9) under this ground, there is no need
The key words are repeated and grossly. for conviction.

(2) Physical violence or moral pressure to (10) Abandonment of petitioner by

compel the petitioner to change respondent without justifiable cause for
religious or political affiliation; more than one year.
For purposes of this Article, the term
There must be undue pressure since some pressure "child" shall include a child by nature or by
is expected in every marriage. It must go beyond adoption.
what is permissible (case to case basis).
Art. 56. The petition for legal separation
(3) Attempt of respondent to corrupt or shall be denied on any of the following grounds:
induce the petitioner, a common child, (1) Where the aggrieved party has
or a child of the petitioner, to engage in condoned the offense or act complained
prostitution, or connivance in such of;
corruption or inducement; (2) Where the aggrieved party has
(4) Final judgment sentencing the consented to the commission of the
respondent to imprisonment of more offense or act complained of;
than six years, even if pardoned; (3) Where there is connivance between the
(5) Drug addiction or habitual alcoholism parties in the commission of the offense
of the respondent; or act constituting the ground for legal
separation;
The drug addiction can occur after the marriage. (4) Where both parties have given ground
Article 55 (5) does not talk of concealment of drug for legal separation;
addiction unlike Article 46(4). (5) Where there is collusion between the
parties to obtain decree of legal
(6) Lesbianism or homosexuality of the separation; or
respondent; (6) Where the action is barred by
prescription.
Is this talking about homosexuality in terms of
practice or is such sexual orientation enough? There are 2 more grounds not found in Article 56:
Again, there are no cases. 1. Death of either party during the pendency of the
case (Lapuz-Sy vs. Eufemio)
(7) Contracting by the respondent of a 2. Reconciliation of the spouses during the
subsequent bigamous marriage, pendency of the case (Article 66 (1))
whether in the Philippines or abroad; In Lapuz-Sy vs. Eufemio, the lawyer wanted to
(8) Sexual infidelity or perversion; proceed with legal separation despite of the death of
one of the parties. The Supreme Court denied it
Under the Family Code, both men and women need since the primary purpose of legal separation is bed
only commit one act of sexual infidelity to fall under and board separation while the effect on their
Article 55 (8). property relations is merely incidental.

Art. 46. Any of the following circumstances shall Art. 66. The reconciliation referred to in the
constitute fraud referred to in Number 3 of the preceding Articles shall have the following
preceding Article: consequences:
(4) Concealment of drug addiction, habitual (1) The legal separation proceedings, if still
alcoholism or homosexuality or lesbianism pending, shall thereby be terminated at
existing at the time of the marriage. whatever stage

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Professor Ruben F. Balane Page 38 of 241
 d. When the consent of 1 spouse to any
Art. 58. An action for legal separation transaction of the other is required by law,
shall in no case be tried before six months shall judicial authorization shall be necessary,
have elapsed since the filing of the petition. unless such spouse voluntarily gives such
consent.
This is the cooling-off period can only try the
petition for legal separation after 6 months from 2. Effects of the Decree of Legal Separation
filing. The Supreme Court has interpreted Article 58 (Nos. 1 4, Article 63)
to mean that there shall be no hearing on the main
issue but the court may hear incidental issues. Art. 63. The decree of legal
In the case of Araneta vs. Concepcion, the Supreme separation shall have the following
Court allowed the court to hear the issue regarding effects:
the custody of the children even if the 6-month (1) The spouses shall be entitled to
period had not yet elapsed. Professor Balane didnt live separately from each other,
like the ruling in this case. According to him, what but the marriage bonds shall not
are you going to talk about if you dont go to the be severed;
main case? (2) The absolute community or the
conjugal partnership shall be
Art. 59. No legal separation may be dissolved and liquidated but the
decreed unless the Court has taken steps toward offending spouse shall have no
the reconciliation of the spouses and is fully right to any share of the net
satisfied, despite such efforts, that profits earned by the absolute
reconciliation is highly improbable. community or the conjugal
partnership, which shall be
For legal separation to be declared, reconciliation forfeited in accordance with the
must be highly unlikely. provisions of Article 43(2);
(3) The custody of the minor
Art. 60. No decree of legal separation children shall be awarded to the
shall be based upon a stipulation of facts or a innocent spouse, subject to the
confession of judgment. provisions of Article 213 of this
In any case, the Court shall order the Code; and
prosecuting attorney or fiscal assigned to it to (4) The offending spouse shall be
take steps to prevent collusion between the disqualified from inheriting
parties and to take care that the evidence is not from the innocent spouse by
fabricated or suppressed. intestate succession. Moreover,
provisions in favor of the
No decree of legal separation shall be based upon a offending spouse made in the
stipulation of facts or a confession judgment. In will of the innocent spouse shall
Ocampo vs. Florenciano, the Supreme Court said be revoked by operation of law.
that legal separation cannot be granted on the basis
of the wifes admission alone. There must be other a. Spouses shall be entitled to live separately
proof. from each other, but the marriage bonds
shall not be severed.
1. Effects of Filing A Petition for Legal b. The ACP or the CPG shall be dissolved and
Separation liquidated. The offending spouse shall have
a. Spouses can live separately from each other. no right to any share of the net profits
b. The administration of the common
properties (ACP, CPG, etc) shall be given by
the court to either of the spouses or to a 3 rd
person as is best for the interests of the
community.
c. In the absence of a written agreement of the
spouses, the court shall provide for the
support between the spouses and the
custody and support of the common
children, taking into account the welfare of
the children and their choice of the parent
with whom they wish to remain.

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Professor Ruben F. Balane Page 39 of 241
 earned by the ACP or CPG following the g. Cessation of the obligation of mutual
rules of forfeiture in Article 43 (2). support. (Article 198)
c. The custody of the minor children shall be h. The wife shall continue using her name and
awarded to the innocent spouse subject to surname employed before legal separation.
Article 213.
d. The offending spouse shall be disqualified 3. Effects of Reconciliation
from inheriting from the innocent spouse by a. Joint custody of the children is restored.
intestate succession. Testamentary b. The right to succeed by the guilty spouse
dispositions in favor of the offending spouse from the offended spouse is restored
shall be revoked by operation of law. compulsory only.
e. Donation propter nuptias made by the c. With regard testamentary spouse in the will
innocent spouse to the offending spouse of the innocent spouse.
may be revoked at the option of the former. d. If the donation propter nuptias succession,
(Article 64) reconciliation will not automatically revive
f. The designation by the innocent spouse of the institution of the guilty were revoked,
the offending spouse as a beneficiary in any the same is not automatically restored.
insurance policy (even irrevocable ones) Articles 65 and 66 always allow
may be revoked by the innocent spouse. reconciliation even after the decree.
(Article 64)
Art. 65. If the spouses should
reconcile, a corresponding joint
manifestation under oath duly signed

Art. 43. The termination of the subsequent marriage by them shall be filed with the court in
referred to in the preceding Article shall produce the the same proceeding for legal
following effects: separation.
(2) The absolute community of property or the
conjugal partnership, as the case may be, shall Art. 66. The reconciliation
be dissolved and liquidated, but if either referred to in the preceding Articles
spouse contracted said marriage in bad faith, shall have the following
his or her share of the net profits of the consequences:
community property or conjugal partnership (1) The legal separation
property shall be forfeited in favor of the proceedings, if still pending,
common children or, if there are none, the shall thereby be terminated
children of the guilty spouse by a previous at whatever stage; and
marriage or in default of children, the innocent (2) The final decree of legal
spouse; separation shall be set aside,

Art. 213. In case of separation of the parents, but the separation of

parental authority shall be exercised by the parent property and any forfeiture
designated by the Court. The Court shall take into of the share of the guilty
account all relevant considerations, especially the spouse already effected shall
choice of the child over seven years of age, unless the subsist, unless the spouses
parent chosen is unfit. agree to revive their former

Art. 64. After the finality of the decree of legal property regime.
separation, the innocent spouse may revoke the The court's order containing
donations made by him or by her in favor of the the foregoing shall be recorded in the
offending spouse, as well as the designation of the proper civil registries.
latter as beneficiary in any insurance policy, even if
such designation be stipulated as irrevocable. The
revocation of the donations shall be recorded in the
registries of property in the places where the

properties are located. Alienations, liens and Art. 198. During the proceedings for legal
encumbrances registered in good faith before the separation or for annulment of marriage, and for
recording of the complaint for revocation in the declaration of nullity of marriage, the spouses and
registries of property shall be respected. The their children shall be supported from the properties of
revocation of or change in the designation of the the absolute community or the conjugal partnership.
insurance beneficiary shall take effect upon written After the final judgment granting the petition, the
notification thereof to the insured. obligation of mutual support between the spouses
The action to revoke the donation under this ceases. However, in case of legal separation, the court
Article must be brought within five years from the time may order that the guilty spouse shall give support to
the decree of legal separation become final. the innocent one, specifying the terms of such order.

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Professor Ruben F. Balane Page 40 of 241
 According to Professor Balane, it is not the or fruits, such obligations shall be satisfied from
reconciliation which produces the effects in the separate properties.
Article 66. Rather, it is the filing of the joint
manifestation of reconciliation. Support is a joint responsibility. Both spouses are
responsible for the support of the family.
X. Rights and Obligations between Husband Support comprises everything indispensable for
and Wife sustenance, dwelling, clothing, medical attendance,
education and transportation, in keeping with the
Art. 68. The husband and wife are financial capacity of the family (Article 194)
obliged to live together, observe mutual love, Under Articles 94 (last ) , 121 (last ) and 146
respect and fidelity, and render mutual help and (2), if the community property is insufficient to
support. cover debts of the community property, then the
spouses are solidarily liable with their separate
This is really a declaration of policy property. If the spouses have a regime of separation
The 3 duties of the spouses to each other are: of property, the spouses are solidarily liable to
1. Live together creditors for family expenses.
2. Observe mutual love, respect, and fidelity
3. Render mutual help and support Art. 73. Either spouse may exercise any
Article 68 is Article 36s reference when it refers to legitimate profession, occupation, business or
the spouses inability to comply with the essential activity without the consent of the other. The
marital obligations. latter may object only on valid, serious, and
Although the courts cannot compel the spouses to moral grounds.
comply with their marital obligations, under Articles In case of disagreement, the court shall
100 and 127, the spouse who leaves the conjugal decide whether or not:
home or refuses to live there without jus t cause shall (1) The objection is proper, and
not have the right to be supported. (2) Benefit has occurred to the family prior
to the objection or thereafter. If the
Art. 69. The husband and wife shall fix benefit accrued prior to the objection,
the family domicile. In case of disagreement, the the resulting obligation shall be
court shall decide. enforced against the separate property
The court may exempt one spouse from of the spouse who has not obtained
living with the other if the latter should live consent.
abroad or there are other valid and compelling The foregoing provisions shall not
reasons for the exemption. However, such prejudice the rights of creditors who acted in
exemption shall not apply if the same is not good faith.
compatible with the solidarity of the family.
There is an error here. This is NOT the full text. The
The power to fix the domicile is joint. text should read:
General Rule: Separation is incompatible with Either spouse may exercise any
family solidarity. legitimate profession, occupation,
Exception: Article 69, 2* business or activity without the consent
1. One spouse should live abroad of the other. The latter may object only
2. Other valid and compelling reasons on valid, serious and moral grounds.
In case of disagreement, the court
Art. 70. The spouses are jointly shall decide whether or not:
responsible for the support of the family. The 1. The objection is proper, and
expenses for such support and other conjugal
obligations shall be paid from the community
Art. 94, last . If the community property is
property and, in the absence thereof, from the insufficient to cover the foregoing liabilities, except
income or fruits of their separate properties. In those falling under paragraph (9), the spouses shall be
case of insufficiency or absence of said income solidarily liable for the unpaid balance with their
separate properties.

Art. 121, last . If the conjugal partnership is
*
Art. 69, 2. The court may exempt one spouse from insufficient to cover the foregoing liabilities, the
living with the other if the latter should live abroad or spouses shall be solidarily liable for the unpaid balance
there are other valid and compelling reasons for the with their separate properties.

exemption. However, such exemption shall not apply if Art. 146, 2. The liabilities of the spouses to
the same is not compatible with the solidarity of the creditors for family expenses shall, however, be
family. solidary.

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Professor Ruben F. Balane Page 41 of 241
 2. Benefit has accrued to the Exceptions:
family prior to the objection or 1. Legal Separation (Article 63 (2))
thereafter. If the benefit accrued In such an instance, the property regime is
prior to the objection, the dissolved.
resulting obligation shall be 2. Revival of the former property regime upon
enforced against the community reconciliation if the spouses agree (Article 66
property. If the benefit accrued (2))
thereafter, such obligation shall 3. A spouse may petition the court for:
be enforced against the separate 1. Receivership
property of the spouse who has 2. Judicial separation of property, or
not obtained consent. 3. The authority to be the sole administrator of
the conjugal partnership
XI. Property Relations If the other spouse abandons the other
without just cause or fails to comply with his
Property relations are very important to creditors. or her obligations to the family. (Article
128)
Art. 74. The property relationship 4. Judicial Dissolution (Articles 135 and 136)
between husband and wife shall be governed in
the following order:
Art. 63. The decree of legal separation shall have
(1) By marriage settlements executed the following effects:
before the marriage; (2) The absolute community or the conjugal
(2) By the provisions of this Code; and partnership shall be dissolved and liquidated
(3) By the local custom. but the offending spouse shall have no right to
any share of the net profits earned by the
Property relations is the only instance when the absolute community or the conjugal
husband and wife can stipulate as to the terms an partnership, which shall be forfeited in
conditions. accordance with the provisions of Article 43(2);

The marriage settlement governs the property Art. 66. The reconciliation referred to in the
relations of spouses provided such is not contrary to preceding Articles shall have the following
law. consequences:
In the absence of a marriage settlement, the Family (2) The final decree of legal separation shall be set
Code comes in. If the Family Code in a rare instance aside, but the separation of property and any
is not applicable, then custom comes in. forfeiture of the share of the guilty spouse
already effected shall subsist, unless the
Therefore, in the absence of a marriage settlement or
spouses agree to revive their former property
when such marriage settlement is void, ACP shall be
regime.
their marriage settlement by operation of law.
Art. 128. If a spouse without just cause
As an exception, when the 1 st marriage is dissolved
abandons the other or fails to comply with his or her
by reason of death and the 2 nd marriage was entered
obligation to the family, the aggrieved spouse may
into before the conjugal partnership is liquidated,
petition the court for receivership, for judicial
the law mandates that a regime of complete
separation of property, or for authority to be the sole
separation of property shall govern. administrator of the conjugal partnership property,
subject to such precautionary conditions as the court
Art. 75. The future spouses may, in the may impose.
marriage settlements, agree upon the regime of The obligations to the family mentioned in the
absolute community, conjugal partnership of preceding paragraph refer to marital, parental or
gains, complete separation of property, or any property relations.
other regime. In the absence of a marriage A spouse is deemed to have abandoned the
settlement, or when the regime agreed upon is other when he or she has left the conjugal dwelling
void, the system of absolute community of without intention of returning. The spouse who has left
property as established in this Code shall govern. the conjugal dwelling for a period of three months or
has failed within the same period to give any
ACP is the regime of the spouses in the absence of a information as to his or her whereabouts shall be
marriage settlement or when the marriage prima facie presumed to have no intention of returning
settlement is void. This is so because ACP is more to the conjugal dwelling.

in keeping with Filipino culture. Art. 135. Any of the following shall be considered
General Rule: All modifications to the marriage sufficient cause for judicial separation of property:
settlement must be made before the marriage is (1) That the spouse of the petitioner has been
celebrated. sentenced to a penalty which carries with it
civil interdiction;

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Professor Ruben F. Balane Page 42 of 241
 If the party has not yet reached the age of 21,
Art. 77. The marriage settlements and parental consent is also required with regard to the
any modification thereof shall be in writing, marriage settlement.
signed by the parties and executed before the
celebration of the marriage. They shall not Art. 79. For the validity of any marriage
prejudice third persons unless they are settlement executed by a person upon whom a
registered in the local civil registry where the sentence of civil interdiction has been
marriage contract is recorded as well as in the pronounced or who is subject to any other
proper registries of properties. disability, it shall be indispensable for the
guardian appointed by a competent court to be
Form: Marriage settlements and their made a party thereto.
modifications must be in writing (private or public)
for validity Art. 80. In the absence of a contrary
To bind 3rd persons, the marriage settlement must be stipulation in a marriage settlement, the
registered in: property relations of the spouses shall be
1. Local Civil Registry where the marriage contract governed by Philippine laws, regardless of the
is recorded. place of the celebration of the marriage and their
2. Proper Registries of Property residence.
This rule shall not apply:
Art. 78. A minor who according to law (1) Where both spouses are aliens;
may contract marriage may also execute his or (2) With respect to the extrinsic validity of
her marriage settlements, but they shall be valid contracts affecting property not
only if the persons designated in Article 14 to situated in the Philippines and executed
give consent to the marriage are made parties to in the country where the property is
the agreement, subject to the provisions of Title located; and
IX of this Code. (3) With respect to the extrinsic validity of
contracts entered into in the
Philippines but affecting property
situated in a foreign country whose laws
require different formalities for its
extrinsic validity.
(2) That the spouse of the petitioner has been
judicially declared an absentee;
(3) That loss of parental authority of the spouse of Art. 81. Everything stipulated in the
petitioner has been decreed by the court; settlements or contracts referred to in the
(4) That the spouse of the petitioner has preceding articles in consideration of a future
abandoned the latter or failed to comply with marriage, including donations between the
his or her obligations to the family as provided prospective spouses made therein, shall be
for in Article 101; rendered void if the marriage does not take
(5) That the spouse granted the power of place. However, stipulations that do not depend
administration in the marriage settlements has upon the celebration of the marriages shall be
abused that power; and valid.
(6) That at the time of the petition, the spouses The marriage settlement and the donations propter
have been separated in fact for at least one nuptias are void if the marriage does not take place.
year and reconciliation is highly improbable.
In the cases provided for in Numbers (1), (2) A. Donations Propter Nuptias
and (3), the presentation of the final judgment against
the guilty or absent spouse shall be enough basis for Requisites of Donations Propter nuptias
the grant of the decree of judicial separation of 1. Made before marriage
property. 2. Made in consideration of the marriage
Art. 136. The spouses may jointly file a (the motivation behind the donation is
verified petition with the court for the voluntary
the marriage)
dissolution of the absolute community or the conjugal
3. In favor of one or both of the spouses
partnership of gains, and for the separation of their
common properties. The donee must be 1 or both of the spouses
All creditors of the absolute community or of The donor can be anybody including 1 of the
the conjugal partnership of gains, as well as the spouses
personal creditors of the spouse, shall be listed in the If the wedding gift is given before the
petition and notified of the filing thereof. The court wedding that is a donation propter nuptias.
shall take measures to protect the creditors and other
persons with pecuniary interest.

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Professor Ruben F. Balane Page 43 of 241
 If the wedding gift is given after the the donation of future property is really a
wedding, that is treated as an ordinary testamentary disposition.
donation In the case of Mateo vs. Lagua, the Supreme
Court said that donations propter nuptias
Art. 83. These donations are may be revoked for being inofficious.
governed by the rules on ordinary If the donor is not one of the future spouses,
donations established in Title III of Book the donor may give more than 1/5 of his
III of the Civil Code, insofar as they are present property provided that the legitimes
not modified by the following articles. are not impaired.
If the regime is ACP, there is no need to give
FORM: Must comply with the form of a donation propter nuptias to your spouse.
donations in order to be valid (See Articles It is useless since such donation shall
748 and 749) become part of the community property. In
addition, donors tax must be paid.
Art. 84. If the future spouses
agree upon a regime other than the Art. 86. A donation by reason of
absolute community of property, they marriage may be revoked by the donor in
cannot donate to each other in their the following cases:
marriage settlements more than one-fifth (1) If the marriage is not celebrated
of their present property. Any excess or judicially declared void ab
shall be considered void. initio except donations made in
Donations of future property shall the marriage settlements, which
be governed by the provisions on shall be governed by Article 81;
testamentary succession and the (2) When the marriage takes place
formalities of wills. without the consent of the
parents or guardian, as required
This article applies only if the regime is NOT by law;
ACP. Otherwise, everything practically (3) When the marriage is annulled,
would be community property. and the donee acted in bad faith;
If the donor is one of the future spouses and (4) Upon legal separation, the donee
the regime is NOT ACP, the donor cannot being the guilty spouse;
donate more than 1/5 of his PRESENT (5) If it is with a resolutory
PROPERTY. condition and the condition is
The future spouse may donate future complied with;
property to his fiance for as long as it is not (6) When the donee has committed
inofficious (does not impair legitimes of the an act of ingratitude as specified
other compulsory heirs). This is so because by the provisions of the Civil
Code on donations in general.

Art. 748. The donation of a movable may be made The donations propter nuptias may be
orally or in writing. revoked on the grounds enumerated here.
An oral donation requires the simultaneous In Article 86 (6), the act of ingratitude refers
delivery of the thing or of the document representing to Article 765.
the right donated.
If the value of the personal property donated

exceeds five thousand pesos, the donation and the Art. 765. The donation may also be revoked at the
acceptance shall be made in writing, otherwise, the instance of the donor, by reason of ingratitude in the
donation shall be void. following cases:
Art. 749. In order that the donation of an (1) If the donee should commit some offense
immovable may be valid, it must be made in a public against the person, the honor or the property
document, specifying therein the property donated and of the donor, or of his wife or children under
the value of the charges which the donee must satisfy. his parental authority;
The acceptance may be made in the same (2) If the donee imputes to the donor any criminal
deed of donation or in a separate public document, but offense, or any act involving moral turpitude,
it shall not take effect unless it is done during the even though he should prove it, unless the
lifetime of the donor. crime or the act has been committed against
If the acceptance is made in a separate the donee himself, his wife or children under
instrument, the donor shall be notified thereof in an his authority;
authentic form, and this step shall be noted in both (3) If he unduly refuses him support when the
instruments. donee is legally or morally bound to give

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Professor Ruben F. Balane Page 44 of 241
 1. Property acquired during the marriage
Art. 87. Every donation or grant of by gratuitous title, including the fruits
gratuitous advantage, direct or indirect, and the income.
between the spouses during the marriage Exception to the exception: The
shall be void, except moderate gifts which donor, testator, or grantor expressly
the spouses may give each other on the provides otherwise.
occasion of any family rejoicing. The As father dies. A inherits from the
prohibition shall also apply to persons father. A marries B. The property
living together as husband and wife inherited by A from his father is part
without a valid marriage. of the community property.
Bs mother dies during Bs marriage
General Rule: During the marriage, the to A. The property inherited by B
spouses may not donate to one another. from her mother does not form part
Exception: Spouses may give moderate of the community property.
gifts to each other on the occasion of any In ACP, the income from separate
family rejoicing. property of the spouses does not
NOTE: Article 87 is applicable to common- form part of the community
law spouses (Matabuena vs. Cervantes) property.
This is to minimize improper or undue IN CPG, the income from separate
pressure as well as to prevent the spouses property of the spouses forms part
from defrauding their creditors. of the community property.
2. Property for personal and exclusive use
B. System of Absolute Community of either spouse
Exception to the Exception:
Art. 91. Unless otherwise provided Jewelry forms part of the community
in this Chapter or in the marriage property.
settlements, the community property 3. Property acquired before the marriage
shall consist of all the property owned by by either spouse who has legitimate
the spouses at the time of the celebration descendants by a former marriage, and
of the marriage or acquired thereafter. the fruits and income of such property.
This is provided for so that the
Art. 92. The following shall be children from the 1st marriage will
excluded from the community property: not be prejudiced.
(1) Property acquired during the
marriage by gratuitous title by Art. 93. Property acquired during
either spouse, and the fruits as the marriage is presumed to belong to the
well as the income thereof, if community, unless it is proved that it is
any, unless it is expressly one of those excluded therefrom.
provided by the donor, testator
or grantor that they shall form Presumption: Property acquired during
part of the community property; the marriage is presumed to belong to the
(2) Property for personal and community.
exclusive use of either spouse. However it can be rebutted by proving such
However, jewelry shall form part property acquired during marriage is
of the community property; excluded.
(3) Property acquired before the
marriage by either spouse who Art. 94. The absolute community
has legitimate descendants by a of property shall be liable for:
former marriage, and the fruits
as well as the income, if any, of Article 94 enumerates the charges upon the
such property. absolute community of property.

General Rule: Community property (1) The support of the spouses, their
shall consist of all the property owned by the common children, and legitimate
spouses at the time of the celebration of the children of either spouse;
marriage or acquired thereafter. however, the support of
Exceptions: illegitimate children shall be

support to the donor.

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Professor Ruben F. Balane Page 45 of 241
 governed by the provisions of The ACP is liable only to the extent that
this Code on Support; the family may have benefited.
Problem: What is the rule now regarding
The ACP shall support the spouses common obligations contracted by the business of a
children and legitimate children of either particular spouse?
spouse According to Professor Balane, there are 2
A common child of the spouse may not views. One view is that Article 94 (3) may be
necessarily be legitimate. For example, A is applied since both spouses are the
married to B. A has an affair with C. A and administrators of the community property.
C have a child, D. B dies. A and C get Therefore, one spouse should not act alone
married. D cannot be legitimated since at as administrator. Therefore, obligations
the time of Ds conception, A and C had no contracted for the business operations of a
capacity to get married. spouse are without consent of the other.
Illegitimate children are supported: Another view is that such debts would fall
1. Primarily by their biological parent under Article 94 (2). According to Justice
2. Subsidiarily by the ACP (Article 94 (9)*) Vitug, there is implied consent by the other
spouse since the same did not object.
(2) All debts and obligations Otherwise, commercial transactions would
contracted during the marriage slow down.
by the designated administrator-
spouse for the benefit of the (4) All taxes, liens, charges and
community, or by both spouses, expenses, including major or
or by one spouse with the minor repairs, upon the
consent of the other; community property;
(3) Debts and obligations contracted (5) All taxes and expenses for mere
by either spouse without the preservation made during
consent of the other to the extent marriage upon the separate
that the family may have been property of either spouse used
benefited; by the family;

The wordings under Articles 94 (2) and 94 Taxes and expenses for the preservation
(3) are different upon the exclusive property by 1 of the
Article 94 (2) contemplates 3 situations: spouses should be borne by the ACP. This is
1. Obligations contracted by the so because the family benefits.
designated administrator spouse for the
purpose of benefiting the community. (6) Expenses to enable either spouse
Under 94 (2) (a), purpose is enough. to commence or complete a
It is not required to show to what professional or vocational
extent the family benefited. course, or other activity for self-
2. Obligations contracted by both spouses improvement;
3. Obligations contracted by 1 spouse with (7) Antenuptial debts of either
the consent of the other. spouse insofar as they have
Article 94 (3) contemplates the situation redounded to the benefit of the
wherein 1 spouse contracts an obligation family;
without the consent of the other. (8) The value of what is donated or
promised by both spouses in
* favor of their common legitimate
Art. 94. The absolute community of property shall be children for the exclusive
liable for: purpose of commencing or
(9) Antenuptial debts of either spouse other than completing a professional or
those falling under paragraph (7) of this
vocational course or other
Article, the support of illegitimate children of
activity for self-improvement;
either spouse, and liabilities incurred by either
(9) Antenuptial debts of either
spouse by reason of a crime or a quasi-delict,
spouse other than those falling
in case of absence or insufficiency of the
exclusive property of the debtor-spouse, the
under paragraph (7) of this
payment of which shall be considered as Article, the support of
advances to be deducted from the share of the illegitimate children of either
debtor-spouse upon liquidation of the spouse, and liabilities incurred
community; by either spouse by reason of a

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Professor Ruben F. Balane Page 46 of 241
 crime or a quasi-delict, in case of continuing offer on the part of the
absence or insufficiency of the consenting spouse and the third
exclusive property of the debtor- person, and may be perfected as a
spouse, the payment of which binding contract upon the acceptance
shall be considered as advances by the other spouse or authorization
to be deducted from the share of by the court before the offer is
the debtor-spouse upon withdrawn by either or both offerors.
liquidation of the community;
and The other spouse may assume sole
powers of administration when:
Ante-nuptial debts not falling under Article 1. The other spouse is incapacitated.
94 (7) will be borne by the ACP if the 2. The other spouse is unable to
separate property of the debtor-spouse is participate (i.e., abroad)
insufficient. The power to administer does not
include the power to dispose or
(10) Expenses of litigation between encumber solely by 1 spouse. Court
the spouses unless the suit is authority or the approval of the other
found to be groundless. spouse is required.
If the community property is
insufficient to cover the foregoing Art. 97. Either spouse may
liabilities, except those falling under dispose by will of his or her interest
paragraph (9), the spouses shall be in the community property.
solidarily liable for the unpaid balance
with their separate properties. Art. 98. Neither spouse may
donate any community property
1. Administration and Enjoyment of without the consent of the other.
Community Property However, either spouse may,
without the consent of the other,
Art. 96, 1. The administration make moderate donations from the
and enjoyment of the community community property for charity or
property shall belong to both spouses on occasions of family rejoicing or
jointly. In case of disagreement, the family distress.
husband's decision shall prevail,
subject to recourse to the court by the General Rule:In order to donate any
wife for proper remedy, which must community property, the other spouse
be availed of within five years from must consent.
the date of the contract implementing Exception: Moderate donations do
such decision. not need the consent of the other spouse
if for:
Administration of the community 1. Charity
property belongs to both spouses jointly. 2. Occasions of family rejoicing or
Both spouses must consent to the distress
encumbrance or disposition of the
community property. 2. Dissolution and Liquidation of
Absolute Community
Art. 96 (2), 2. In the event
that one spouse is incapacitated or Art. 99. The absolute
otherwise unable to participate in the community terminates:
administration of the common (1) Upon the death of either
properties, the other spouse may spouse;
assume sole powers of (2) When there is a decree of
administration. These powers do not legal separation;
include disposition or encumbrance (3) When the marriage is
without authority of the court or the annulled or declared void; or
written consent of the other spouse. (4) In case of judicial separation
In the absence of such authority or of property during the
consent, the disposition or marriage under Article 134 to
encumbrance shall be void. However, 138.
the transaction shall be construed as a

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Professor Ruben F. Balane Page 47 of 241
 Dissolution of the ACP is not case of insufficiency of said
synonymous with the dissolution of the assets, the spouses shall be
marriage. In Articles 99 (2) and (4), the solidarily liable for the
ACP is dissolved although the marriage unpaid balance with their
is not. However, the dissolution of the separate properties in
marriage automatically results in the accordance with the
dissolution of the ACP. provisions of the second
In Article 99 (3), when a marriage is paragraph of Article 94.
declared as a nullity, there is no ACP to (3) Whatever remains of the
dissolve since there was no property exclusive properties of the
regime to begin with. The dissolution in spouses shall thereafter be
such a case would be governed by the delivered to each of them.
rules on co-ownership. (4) The net remainder of the
Article 99 is not a complete enumeration properties of the absolute
of the instances when the ACP community shall constitute
terminates. Another instance is when its net assets, which shall be
the marriage is terminated by the divided equally between
reappearance of the absent spouse husband and wife, unless a
(Articles 42 and 43 (2)). different proportion or
division was agreed upon in
Art. 102. Upon dissolution of the marriage settlements, or
the absolute community regime, the unless there has been a
following procedure shall apply: voluntary waiver of such
(1) An inventory shall be share provided in this Code.
prepared, listing separately For purpose of computing the
all the properties of the net profits subject to
absolute community and the forfeiture in accordance with
exclusive properties of each Articles 43, No. (2) and 63,
spouse. No. (2), the said profits shall
(2) The debts and obligations of be the increase in value
the absolute community shall between the market value of
be paid out of its assets. In the community property at
the time of the celebration of

Art. 42. The subsequent marriage referred to in the the marriage and the market
preceding Article shall be automatically terminated by value at the time of its
the recording of the affidavit of reappearance of the dissolution.
absent spouse, unless there is a judgment annulling (5) The presumptive legitimes of
the previous marriage or declaring it void ab initio. the common children shall be
A sworn statement of the fact and delivered upon partition, in
circumstances of reappearance shall be recorded in the accordance with Article 51.
civil registry of the residence of the parties to the (6) Unless otherwise agreed
subsequent marriage at the instance of any interested upon by the parties, in the
person, with due notice to the spouses of the partition of the properties,
subsequent marriage and without prejudice to the fact the conjugal dwelling and the
of reappearance being judicially determined in case lot on which it is situated
such fact is disputed. shall be adjudicated to the
Art. 43. The termination of the subsequent spouse with whom the
marriage referred to in the preceding Article shall majority of the common
produce the following effects: children choose to remain.
(2) The absolute community of property or the Children below the age of
conjugal partnership, as the case may be, shall seven years are deemed to
be dissolved and liquidated, but if either have chosen the mother,
spouse contracted said marriage in bad faith, unless the court has decided
his or her share of the net profits of the otherwise. In case there in no
community property or conjugal partnership such majority, the court shall
property shall be forfeited in favor of the decide, taking into
common children or, if there are none, the consideration the best
children of the guilty spouse by a previous
interests of said children.
marriage or in default of children, the innocent
spouse;

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Professor Ruben F. Balane Page 48 of 241
 Article 102 enumerates the steps in given judicial authority to
liquidation: administer or encumber any
1. Inventory specific separate property of
3 lists the other spouse and use the
1. Inventory of community fruits or proceeds thereof to
property satisfy the latters share.
2. Inventory of separate
property of the wife Separation de facto does not dissolve the
3. Inventory of separate ACP.
property of the husband.
2. Payment of Community Debts Art. 101. If a spouse without
First, pay out of community just cause abandons the other or fails
assets to comply with his or her obligations
If not enough, husband and wife to the family, the aggrieved spouse
are solidarily liable with their may petition the court for
separate property. receivership, for judicial separation of
3. Delivery to each spouse his or her property or for authority to be the sole
separate property if any. administrator of the absolute
4. Division of the net community community, subject to such
assets precautionary conditions as the court
NOTE: There are special rules may impose.
regarding the family home. The obligations to the family
5. Delivery of presumptive legitimes if mentioned in the preceding
any to the children paragraph refer to marital, parental
The presumptive legitimes are given in or property relations.
the following instances: A spouse is deemed to have
1. Death of either spouse (Article 103) abandoned the other when her or she
2. Legal Separation (Articles 63 and has left the conjugal dwelling without
64) intention of returning. The spouse
3. Annulment (Articles 50 52) who has left the conjugal dwelling for
4. Judicial Separation of Property a period of three months or has failed
(Articles 134 137) within the same period to give any
5. Reappearance of the absent spouse information as to his or her
which terminates the 2nd marriage whereabouts shall be prima facie
(Article 43) presumed to have no intention of
returning to the conjugal dwelling.
Art. 100. The separation in
fact between husband and wife shall If a spouse abandons the other spouse
not affect the regime of absolute without just cause or fails to comply
community except that: with his or marital obligations, the
(1) The spouse who leaves the aggrieved spouse may petition the court
conjugal home or refuses to for the following:
live therein, without just 1. Receivership
cause, shall not have the right 2. Judicial separation of property
to be supported; 3. Authority to be the sole
(2) When the consent of one administrator.
spouse to any transaction of Abandonment occurs when one leaves
the other is required by law, the conjugal dwelling without intention
judicial authorization shall of returning.
be obtained in a summary Presumption of Abandonment:
proceeding; When the spouse has left the conjugal
(3) In the absence of sufficient dwelling for a period of 3 months
community property, the without giving information as to his
separate property of both whereabouts.
spouses shall be solidarily
liable for the support of the Art. 104. Whenever the
family. The spouse present liquidation of the community
shall, upon proper petition in properties of two or more marriages
a summary proceeding, be contracted by the same person before

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Professor Ruben F. Balane Page 49 of 241
 the effectivity of this Code is carried both spouses shall be divided equally
out simultaneously, the respective between them, unless otherwise agreed in
capital, fruits and income of each the marriage settlements.
community shall be determined upon
such proof as may be considered The husband and wife place in a common
according to the rules of evidence. In fund:
case of doubt as to which community 1. Income of their separate properties
the existing properties belong, the 2. Everything acquired by them through
same shall be divided between the their efforts (whether singly or jointly)
different communities in proportion 3. Everything acquired by them through
to the capital and duration of each. chance (the winnings from gambling,
hidden treasure, those acquired from
Article 104 will hardly ever occur. Skip hunting)
this. The spouses are not co-owners of the
conjugal properties during the marriage and
C. Conjugal Partnership of Gains cannot alienate the supposed interest of
each in the said properties. The interest of
Knowing the CPG is important. Under the the spouses in the conjugal properties is only
Civil Code, this was the preponderant inchoate or a mere expectancy and does not
property regime. Since a lot of marriages ripen into title until it appears after the
took place before the effectivity of the dissolution and liquidation of the
Family Code August 3, 1988 many partnership that there are net assets (De
property regimes are CPG. Ansaldo vs. Sheriff of Manila).
Art. 107. The rules provided in
Art. 105. In case the future Articles 88 and 89 shall also apply to
spouses agree in the marriage conjugal partnership of gains.
settlements that the regime of conjugal
partnership gains shall govern their Art. 108. The conjugal partnership
property relations during marriage, the shall be governed by the rules on the
provisions in this Chapter shall be of contract of partnership in all that is not in
supplementary application. conflict with what is expressly
The provisions of this Chapter determined in this Chapter or by the
shall also apply to conjugal partnerships spouses in their marriage settlements.
of gains already established between
spouses before the effectivity of this Code, The rules on partnership shall be applied in
without prejudice to vested rights already a suppletory manner.
acquired in accordance with the Civil
Code or other laws, as provided in Article Art. 109. The following shall be
256. the exclusive property of each spouse:

The regime of CPG applies:

1. In case the future spouse agree on this
Art. 88. The absolute community of property
regime in their marriage settlement,
between spouses shall commence at the precise
their property relations will be governed
moment that the marriage is celebrated. Any
by their agreement with the Family Code
stipulation, express or implied, for the commencement
suppletorily applicable.
of the community regime at any other time shall be
2. CPGs before the affectivity of the Family void.
Code, without prejudice to vested rights
Art. 89. No waiver of rights, shares and effects of
Art. 106. Under the regime of the absolute community of property during the
marriage can be made except in case of judicial
conjugal partnership of gains, the
separation of property.
husband and wife place in a common
When the waiver takes place upon a judicial
fund the proceeds, products, fruits and
separation of property, or after the marriage has been
income from their separate properties
dissolved or annulled, the same shall appear in a public
and those acquired by either or both instrument and shall be recorded as provided in Article
spouses through their efforts or by 77. The creditors of the spouse who made such waiver
chance, and, upon dissolution of the may petition the court to rescind the waiver to the
marriage or of the partnership, the net extent of the amount sufficient to cover the amount of
gains or benefits obtained by either or their credits.

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Professor Ruben F. Balane Page 50 of 241
 (1) That which is brought to the Art. 110. The spouses retain the
marriage as his or her own; ownership, possession, administration
(2) That which each acquires during and enjoyment of their exclusive
the marriage by gratuitous title; properties.
(3) That which is acquired by right Either spouse may, during the
of redemption, by barter or by marriage, transfer the administration of
exchange with property his or her exclusive property to the other
belonging to only one of the by means of a public instrument, which
spouses; and shall be recorded in the registry of
(4) That which is purchased with property of the place the property is
exclusive money of the wife or of located.
the husband.
Art. 111. A spouse of age may
Article 109 enumerates the exclusive mortgage, encumber, alienate or
property of spouses: otherwise dispose of his or her exclusive
1. Property brought to the marriage as his property, without the consent of the other
or her own spouse, and appear alone in court to
Strictly speaking paraphernal litigate with regard to the same.
property refers to the exclusive
property of the wife while capital is Art. 112. The alienation of any
the exclusive property of the exclusive property of a spouse
husband. administered by the other automatically
2. Property which each spouse acquires terminates the administration over such
during the marriage by gratuitous title property and the proceeds of the
Gratuitous title is either: alienation shall be turned over to the
1. By succession owner-spouse.
2. By donation
ACP also has a similar provision. Art. 113. Property donated or left
3. Property which is acquired by right of by will to the spouses, jointly and with
redemption, by barter or exchange with designation of determinate shares, shall
property belonging to only one of the pertain to the donee-spouses as his or her
spouses; and own exclusive property, and in the
Article 109 (3) is illustrated as absence of designation, share and share
follows: The wife owns exclusively a alike, without prejudice to the right of
piece of land. The wife sells such accretion when proper.
land with the right to repurchase it.
The wife redeems the money using Art. 114. If the donations are
conjugal funds. Under Article 109 onerous, the amount of the charges shall
(3), the property is still paraphernal be borne by the exclusive property of the
as the right of redemption belongs donee spouse, whenever they have been
to the wife. The fact that conjugal advanced by the conjugal partnership of
funds were used is irrelevant in that gains.
the wife must liquidate such debt to
the common fund upon the Art. 115. Retirement benefits,
liquidation of the property regime. pensions, annuities, gratuities, usufructs
and similar benefits shall be governed by
Another illustration of Article 109
the rules on gratuitous or onerous
(3) is as follows: The wife owns
acquisitions as may be proper in each
exclusively a lot in BF Homes in
case.
Q.C. The wife decides to sell the lot
and gets money in exchange. The
Art. 116. All property acquired
money is paraphernal property.
during the marriage, whether the
4. Property which is purchased with
acquisition appears to have been made,
exclusive money of the wife or of the
contracted or registered in the name of
husband
one or both spouses, is presumed to be
The rule is the same for ACP conjugal unless the contrary is proved.
although there is no express
provision.

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Professor Ruben F. Balane Page 51 of 241
 Presumption: All property acquired kind brought to the marriage by
during marriage is presumed to be conjugal either spouse; and
(but the contrary may be proved). (7) Those which are acquired by
chance, such as winnings from
Art. 117. The following are gambling or betting. However,
conjugal partnership properties: losses therefrom shall be borne
(1) Those acquired by onerous title exclusively by the loser-spouse.
during the marriage at the
expense of the common fund, Art. 118. Property bought on
whether the acquisition be for installments paid partly from exclusive
the partnership, or for only one funds of either or both spouses and partly
of the spouses; from conjugal funds belongs to the buyer
(2) Those obtained from the labor, or buyers if full ownership was vested
industry, work or profession of before the marriage and to the conjugal
either or both of the spouses; partnership if such ownership was vested
(3) The fruits, natural, industrial, or during the marriage. In either case, any
civil, due or received during the amount advanced by the partnership or
marriage from the common by either or both spouses shall be
property, as well as the net fruits reimbursed by the owner or owners upon
from the exclusive property of liquidation of the partnership.
each spouse;
Article 118 is actually Article 117 (8).
According to Professor Balane, Article 117 Test: When did the ownership vest in the
(3) is inaccurate. There is no problem if the buyer? The source of the funds is irrelevant.
fruits come from the conjugal property. The For example, A who is single, buys on
problem arises when the fruits arise from installment a lot in Tagaytay. A has to pay
the spouses separate properties. For fruits 60 monthly installments. The contract
arising from the separate properties of the provides that ownership would vest upon
spouses to be considered conjugal, one must the full payment of the installments. A had
look at when the fruits are due and not when already paid 20 monthly installments. A
the fruits are received. gets married to B. After that A pays the
For example, A lends P 1,000,000 to B at remaining 40 monthly installments using
20% interest payable every quarter. B is conjugal funds. The property is conjugal
supposed to pay interest on March, June, following Art. 118. The first 20 monthly
Sept, and Dec. B did not pay the interest installments is a credit of A against the
due on March. A gets married to C. B finally property regime. The converse is also true.
pays the interests for the months of March The relevance of the funds is only for
and June on June. The interest for March is accounting purposes.
exclusive property while the interest for
June is conjugal property. The interest for Art. 119. Whenever an amount or
March is exclusive property because the test credit payable within a period of time
is not when A and C receives the fruits. It is belongs to one of the spouses, the sums
when the fruits are due. In this case, the which may be collected during the
fruits were due on March before the marriage in partial payments or by
marriage between A and C. That is why the installments on the principal shall be the
interest for June is conjugal property. exclusive property of the spouse.
However, interests falling due during the
(4) The share of either spouse in the marriage on the principal shall belong to
hidden treasure which the law the conjugal partnership.
awards to the finder or owner of
the property where the treasure Art. 120. The ownership of
is found; improvements, whether for utility or
(5) Those acquired through adornment, made on the separate
occupation such as fishing or property of the spouses at the expense of
hunting; the partnership or through the acts or
(6) Livestock existing upon the efforts of either or both spouses shall
dissolution of the partnership in pertain to the conjugal partnership, or to
excess of the number of each the original owner-spouse, subject to the
following rules:

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Professor Ruben F. Balane Page 52 of 241
 When the cost of the improvement 2. Accession if the cost of the
made by the conjugal partnership and any improvement and the plus value are less
resulting increase in value are more than than the value of the principal property
the value of the property at the time of the at the time the improvement. Thus, the
improvement, the entire property of one entire property becomes exclusive
of the spouses shall belong to the conjugal property of the spouse.
partnership, subject to reimbursement of 3. Ownership of the entire property shall
the value of the property of the owner- vest on the owner-spouse or the
spouse at the time of the improvement; partnership as the case upon the
otherwise, said property shall be retained reimbursement of the improvement.
in ownership by the owner-spouse, 4. Reimbursement time is the time of the
likewise subject to reimbursement of the liquidation of the CPG.
cost of the improvement. 5. The value to be paid at the liquidation is
In either case, the ownership of the value at the time of the improvement
the entire property shall be vested upon (This overrules Padilla vs. Padilla).
the reimbursement, which shall be made Plus value refers to what the
at the time of the liquidation of the improvement contributes to the
conjugal partnership. increase in the value of the whole
thing.
This is known as reverse accession. Problem Areas:
In this situation, an improvement which is 1. Suppose the improvement is destroyed
paid for by conjugal funds is built on land before reimbursement. Will Article 120
which is exclusively owned by one of the apply? Article 120 applies only on the
spouses. assumption that the improvement exists
In Caltex vs. Felias, the Supreme Court said at the time of liquidation. If the
that before Article 120 could be applied, it is property is destroyed before the
essential that the land must be owned by one liquidation, the Article 120 wont apply.
of the spouses before the improvement is In the case of Padilla vs. Paterno, the SC
introduced. said that land never became conjugal
The general rule is that the accessory follows because the conjugal improvements
the principal. Thus, normally the were destroyed before payment could be
improvement would follow the effected.
improvement. In Article 120, this is may not 2. Does the vesting of ownership in reverse
be the case, and it may be that the land accession retroact to the time of the
would follow the improvement. Thats why building of the improvement? The law
its called reverse accession. is not clear.
Rules:
1. Reverse accession - if the cost of the Charges upon the Conjugal
improvement and the plus value are Partnership of Gains
more than the value of the principal
property at the time of the The charges upon the CPG are parallel
improvement. Thus, the entire property to the charges on the ACP.
becomes conjugal.
For example, a lot is worth Art. 121. The conjugal
P1,000,000. A structure worth partnership shall be liable for:
P800,000 was built. Thus, the total (1) The support of the
cost of the separate property and the spouse, their common
improvement is P1,800,000. children, and the
However due to the building of the legitimate children of
improvement, the value of the entire either spouse; however,
property increases by P300,000 the support of illegitimate
the plus value. Thus, the entire children shall be
property is worth P2,100,000. In governed by the
this case, the entire property provisions of this Code on
becomes conjugal. The cost of the Support;
improvement (P800,000) and the (2) All debts and obligations
plus value (P300,000) is more than contracted during the
the cost of the land (P1,000,000). marriage by the
designated administrator-

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Professor Ruben F. Balane Page 53 of 241
 spouse for the benefit of The Articles 122 to 125 have counterpart
the conjugal partnership provisions in the ACP.
of gains, or by both
spouses or by one of them CPG PROVISION COU
with the consent of the Art. 122. The payment of personal Art.
other; debts contracted by the husband or the property sh
(3) Debts and obligations wife before or during the marriage shall (9) Ant
contracted by either not be charged to the conjugal properties ot
spouse without the partnership except insofar as they pa
consent of the other to the redounded to the benefit of the family. su
extent that the family may Neither shall the fines and ei
have benefited; pecuniary indemnities imposed upon them in
(4) All taxes, liens, charges, be charged to the partnership. re
and expenses, including However, the payment of personal de
major or minor repairs debts contracted by either spouse before in
upon the conjugal the marriage, that of fines and indemnities pr
partnership property; imposed upon them, as well as the support th
(5) All taxes and expenses for of illegitimate children of either spouse, co
mere preservation made may be enforced against the partnership de
during the marriage upon assets after the responsibilities de
the separate property of enumerated in the preceding Article have of
either spouse; been covered, if the spouse who is bound
should have no exclusive property or if it
There is no requirement here that it be should be insufficient; but at the time of
used by the family since the CPG is the the liquidation of the partnership, such
usufructuary of the property. spouse shall be charged for what has been
paid for the purpose above-mentioned.
(6) Expenses to enable either
spouse to commence or Art. 123. Whatever may be lost Art.
complete a professional, during the marriage in any game of chance during the
vocational, or other or in betting, sweepstakes, or any other chance, bet
activity for self- kind of gambling whether permitted or kind of ga
improvement; prohibited by law, shall be borne by the prohibited
(7) Antenuptial debts of loser and shall not be charged to the loser and
either spouse insofar as conjugal partnership but any winnings community
they have redounded to therefrom shall form part of the conjugal shall form
the benefit of the family; partnership property. property.
(8) The value of what is
donated or promised by Art. 124. The administration and Art.
both spouses in favor of enjoyment of the conjugal partnership and enjoym
their common legitimate shall belong to both spouses jointly. In shall belon
children for the exclusive case of disagreement, the husband's case of d
purpose of commencing decision shall prevail, subject to recourse decision sh
or completing a to the court by the wife for proper remedy, to the cour
professional or vocational which must be availed of within five years which mus
course or other activity from the date of the contract from the da
for self-improvement; implementing such decision. such decisi
and In the event that one spouse is In
(9) Expenses of litigation incapacitated or otherwise unable to incapacitat
between the spouses participate in the administration of the participate
unless the suit is found to conjugal properties, the other spouse may common pr
groundless. assume sole powers of administration. assume so
If the conjugal partnership These powers do not include disposition or These powe
is insufficient to cover the encumbrance without authority of the encumbran
foregoing liabilities, the spouses court or the written consent of the other court or th
shall be solidarily liable for the spouse. In the absence of such authority or spouse. In
unpaid balance with their separate consent, the disposition or encumbrance consent, th
properties. shall be void. However, the transaction shall be v
shall be construed as a continuing offer on shall be con

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Professor Ruben F. Balane Page 54 of 241
the part of the consenting spouse and the the part of the consenting
authorityspouse
to and administer
the or au
third person, and may be perfected as a third person, and may
encumber
be perfected
any specific
as a separate en
binding contract upon the acceptance by binding contract upon
property
the acceptance
of the otherbyspouse and pr
the other spouse or authorization by the the other spouse or use
authorization
the fruits or by
proceeds
the thereof us
court before the offer is withdrawn by court before the offer
to satisfy
is withdrawn
the latters share.
by to
either or both offerors. either or both offerors.

Art. 125. Neither spouse may Art. 98. Art. 128. If a spouse without just Art.
donate any conjugal partnership property any community property the other or fails to
cause abandons cause aba
without the consent of the other. However, consent ofcomply
the other. However,
with his either
or her obligation to the comply wit
either spouse may, without the consent of spouse may, without
family, the consent
the aggrieved of the
spouse may petition family, the
the other, make moderate donations from other, make themoderate
court fordonations from the
receivership, for judicial the court
the conjugal partnership property for communityseparation
property of property, or for authority to separation
charity or on occasions of family rejoicing occasions be of the
family
sole rejoicing or family
administrator of the conjugal be the sole
or family distress. distress. partnership property, subject to such community
precautionary conditions as the court may conditions
The rules on dissolution are the same. impose. The
The obligations to the family mentioned
CPG PROVISION mentioned
COUNTERPART ACP in Pthe preceding paragraph
ROVISION refer to m
Art. 126. The conjugal partnership refer
Art. 99. to marital, parental or property relations.
terminates: terminates:relations. A
(1) Upon the death of either spouse; (1) A spouse is deemed to have abandoned
(2) When there is a decree of legal (2) abandoned the other when he or she has left the
separation; left the conjugal dwelling without intention o
(3) When the marriage is annulled or (3) intention of returning. The spouse who has left the con
declared void; or left the conjugal dwelling for a period of three mon
(4) In case of judicial separation of (4) three months or has failed within the same same perio
property during the marriage period to give any information as to his or his or her
under Articles 134 to 138. her whereabouts shall be prima facie facie presu
presumed to have no intention of returning t
Like Article 99 (3), Article 126 (3) is returning to the conjugal dwelling.
incorrect. The marriage regime in a void
marriage never existed. There is Art. 129. Upon the dissolution of Art.
nothing to dissolve. The special rules of the conjugal partnership regime, the the absolu
co-ownership shall govern. following procedure shall apply: following p
(1) An inventory shall be prepared, (1) An
Art. 127. The separation in fact Art. 100. listing separately all the lis
properties
between husband and wife shall not affect between husband and wife shall not affect of the conjugal pr
the regime of conjugal partnership, except the regime of partnership and the exclusive co
that: that: properties of each spouse. pr
(1) The spouse who leaves the (1) (2) Amounts advanced by the (2) Th
conjugal home or refuses to live conjugal partnership in payment ab
therein, without just cause, shall of personal debts and obligations ou
not have the right to be of either spouse shall be credited in
supported; to the conjugal partnership as an sp
(2) When the consent of one spouse (2) asset thereof. fo
to any transaction of the other is (3) Each spouse shall be reimbursed se
required by law, judicial for the use of his or her exclusive ac
authorization shall be obtained in funds in the acquisition of th
a summary proceeding; property or for the value of his or 94
(3) In the absence of sufficient her exclusive property, the (3) W
(3)
conjugal partnership property, ownership of which has been ex
the separate property of both vested by law in the conjugal sp
spouses shall be solidarily liable partnership. de
for the support of the family. The (4) The debts and obligations of the (4) Th
spouse present shall, upon conjugal partnership shall be pr
petition in a summary paid out of the conjugal assets. In co
proceeding, be given judicial case of insufficiency of said ne
assets, the spouses shall be eq

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 55 of 241
 solidarily liable for the unpaid property either judicially or extra- judicially
balance with their separate judicially within six months from the months fr
properties, in accordance with the death of the deceased spouse. If upon the spouse. If u
provisions of paragraph (2) of lapse of the six-month period no period, no
Article 121. liquidation is made, any disposition or disposition
(5) Whatever remains of the encumbrance involving the conjugal community
exclusive properties of the partnership property of the terminated marriage sh
spouses shall thereafter be marriage shall be void. Shou
delivered to each of them. Should the surviving spouse contract a
(6) Unless the owner had been contract a subsequent marriage without compliance
indemnified from whatever compliance with the foregoing requiremen
source, the loss or deterioration requirements, a mandatory regime of complete s
of movables used for the benefit complete separation of property shall govern th
of the family, belonging to either govern the property relations of the subsequent
spouse, even due to fortuitous subsequent marriage.
event, shall be paid to said spouse
from the conjugal funds, if any. (5) Art. 131. Whenever the liquidation Art.
(7) The net remainder of the of the conjugal partnership properties of of the com
conjugal partnership properties two or more marriages contracted by the more marr
shall constitute the profits, which same person before the effectivity of this person befo
shall be divided equally between (6) Code is carried out simultaneously, the carried out
husband and wife, unless a respective capital, fruits and income of capital, fr
different proportion or division each partnership shall be determined community
was agreed upon in the marriage upon such proof as may be considered such proof
settlements or unless there has according to the rules of evidence. In case to the rules
been a voluntary waiver or of doubt as to which partnership the as to whi
forfeiture of such share as existing properties belong, the same shall properties
provided in this Code. be divided between the different divided
(8) The presumptive legitimes of the partnerships in proportion to the capital communiti
common children shall be and duration of each. and duratio
delivered upon the partition in
accordance with Article 51. Steps in Liquidation
(9) In the partition of the properties, 1. Inventory of the CPG assets.
the conjugal dwelling and the lot 2. Restitution of advances made to
on which it is situated shall, each spouse (i.e., Article 122, 3)
unless otherwise agreed upon by 3. Payment of debts to each spouse
the parties, be adjudicated to the (i.e., Article 120)
spouse with whom the majority of
the common children choose to
remain. Children below the age of

Art. 122, 3. However, the payment of personal
seven years are deemed to have debts contracted by either spouse before the
chosen the mother, unless the marriage, that of fines and indemnities imposed upon
them, as well as the support of illegitimate children of
court has decided otherwise. In
either spouse, may be enforced against the
case there is no such majority, the
partnership assets after the responsibilities
court shall decide, taking into
enumerated in the preceding Article have been
consideration the best interests
covered, if the spouse who is bound should have no
of said children. exclusive property or if it should be insufficient; but at
the time of the liquidation of the partnership, such
Articles 129 and 102 are counterparts spouse shall be charged for what has been paid
although there are differences. for the purpose above-mentioned.

Art. 120. The ownership of improvements, whether
Art. 130. Upon the termination of Art. 103.
for utility or adornment, made on the separate
the marriage by death, the conjugal the marriage by death, the
property of the spouses at the expense of the
partnership property shall be liquidated property
partnership or through the acts or efforts of either or
in the same proceeding for the settlement proceedingbothfor spouses
the settlement of the estate
shall pertain to the conjugal partnership,
of the estate of the deceased. of the deceased.
or to the original owner-spouse, subject to the
If no judicial settlement proceeding If nofollowing
judicialrules:
settlement proceeding
is instituted, the surviving spouse shall is instituted, the When surviving spouse
the cost of the shall
improvement made by
liquidate the conjugal partnership liquidate thethe conjugal partnership and any resulting increase in

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Professor Ruben F. Balane Page 56 of 241
 4. Payment of obligations to 3rd parties protect the creditors and other
5. Delivery of exclusive properties persons with pecuniary interest.
6. Payment of losses and deterioration
of movables belonging to each There are no need for causes in a
spouse voluntary dissolution.
7. Delivery of presumptive legitimes
8. Division 2. One spouse: petition for sufficient
cause (Article 135)
D. Separation of Property of the Spouses
and Administration of Common Art. 135. Any of the
Property by One Spouse During the following shall be considered
Marriage sufficient cause for judicial
separation of property:
Separation of the property of the spouses (1) That the spouse of the
and the administration of common property petitioner has been
by one spouse during the marriage can take sentenced to a penalty
place in both ACP and CPG. which carries with it civil
A petition may be filed for the dissolution of interdiction;
the ACP or the CPG by: (2) That the spouse of the
1. Both spouses: voluntary petitioner has been
dissolution (Articles 134 and 136) judicially declared an
absentee;
Art. 134. In the absence of (3) That loss of parental
an express declaration in the authority of the spouse of
marriage settlements, the petitioner has been
separation of property between decreed by the court;
spouses during the marriage shall (4) That the spouse of the
not take place except by judicial petitioner has abandoned
order. Such judicial separation of the latter or failed to
property may either be voluntary comply with his or her
or for sufficient cause. obligations to the family
as provided for in Article
Art. 136. The spouses may 101;
jointly file a verified petition with (5) That the spouse granted
the court for the voluntary the power of
dissolution of the absolute administration in the
community or the conjugal marriage settlements has
partnership of gains, and for the abused that power; and
separation of their common (6) That at the time of the
properties. petition, the spouses have
All creditors of the absolute been separated in fact for
community or of the conjugal at least one year and
partnership of gains, as well as the reconciliation is highly
personal creditors of the spouse, improbable.
shall be listed in the petition and In the cases provided for in
notified of the filing thereof. The Numbers (1), (2) and (3), the
court shall take measures to presentation of the final judgment
against the guilty or absent spouse
value are more than the value of the property at the shall be enough basis for the grant
time of the improvement, the entire property of one of of the decree of judicial separation
the spouses shall belong to the conjugal partnership, of property.
subject to reimbursement of the value of the property
of the owner-spouse at the time of the improvement;
Causes are required for a petition
otherwise, said property shall be retained in ownership
for sufficient cause.
by the owner-spouse, likewise subject to
reimbursement of the cost of the improvement.
In either case, the ownership of the entire
property shall be vested upon the reimbursement,
which shall be made at the time of the liquidation of
the conjugal partnership.

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Professor Ruben F. Balane Page 57 of 241
 Article 135 (3) must be taken in
relation with Articles 229 (4) and Art. 137. Once the separation
Articles 231 and 232. of property has been decreed, the
The definition of abandonment in absolute community or the conjugal
Article 135 (4) is found in Articles partnership of gains shall be liquidated in
101 and 128. conformity with this Code.
During the pendency of the
Under Article 135 (6), the spouse
proceedings for separation of property,
must wait for 1 year. After 1 year,
the absolute community or the conjugal
the spouse can file the petition for
partnership shall pay for the support of
sufficient cause. Also reconciliation
the spouses and their children.
must be highly improbable.
The separation of the property of the
Art. 138. After dissolution of the
spouses may not be done extrajudicially absolute community or of the conjugal
even if the spouses agree. Court
partnership, the provisions on complete
intervention is necessary. separation of property shall apply.
After the decree of separation, the parties
can revert back to their original regime by Art. 139. The petition for
filing a motion in court (Article 141). separation of property and the final
judgment granting the same shall be
Art. 229. Unless subsequently revived by a final
recorded in the proper local civil
judgment, parental authority also terminates:
registries and registries of property.
(4) Upon final judgment of a competent court
divesting the party concerned of parental
Art. 140. The separation of
authority;
property shall not prejudice the rights
Art. 231. The court in an action filed for the purpose previously acquired by creditors.
in a related case may also suspend parental authority
if the parent or the person exercising the same: Art. 141. The spouses may, in the
(1) Treats the child with excessive harshness or
same proceedings where separation of
cruelty;
property was decreed, file a motion in
(2) Gives the child corrupting orders, counsel or
court for a decree reviving the property
example;
regime that existed between them before
(3) Compels the child to beg; or
(4) Subjects the child or allows him to be
the separation of property in any of the
subjected to acts of lasciviousness. following instances:
The grounds enumerated above are deemed to (1) When the civil interdiction
include cases which have resulted from culpable terminates;
negligence of the parent or the person exercising (2) When the absentee spouse
parental authority. reappears;
If the degree of seriousness so warrants, or (3) When the court, being satisfied
the welfare of the child so demands, the court shall that the spouse granted the
deprive the guilty party of parental authority or adopt power of administration in the
such other measures as may be proper under the marriage settlements will not
circumstances. again abuse that power,
The suspension or deprivation may be revoked authorizes the resumption of
and the parental authority revived in a case filed for said administration;
the purpose or in the same proceeding if the court (4) When the spouse who has left
finds that the cause therefor has ceased and will not the conjugal home without a
be repeated. decree of legal separation
Art. 232. If the person exercising parental resumes common life with the
authority has subjected the child or allowed him to be other;
subjected to sexual abuse, such person shall be (5) When parental authority is
permanently deprived by the court of such authority. judicially restored to the spouse

A spouse is deemed to have abandoned the other previously deprived thereof;

when her or she has left the conjugal dwelling without (6) When the spouses who have
intention of returning. The spouse who has left the separated in fact for at least one
conjugal dwelling for a period of three months or has year, reconcile and resume
failed within the same period to give any information common life; or
as to his or her whereabouts shall be prima facie
(7) When after voluntary dissolution
presumed to have no intention of returning to the
of the absolute community of
conjugal dwelling.

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Professor Ruben F. Balane Page 58 of 241
 property or conjugal partnership 3. The court may order such in case of
has been judicially decreed upon abandonment (Articles 101 and 128)
the joint petition of the spouses, 4. If the spouses agree to such an
they agree to the revival of the arrangement during marriage.
former property regime. No However, in order to affect 3rd persons,
voluntary separation of property such agreement must be registered.
may thereafter be granted.
The revival of the former property E. Regime of Separation of Property
regime shall be governed by Article 67.
Art. 143. Should the future
If separation was by voluntary dissolution, spouses agree in the marriage
the parties may agree to revert back to their settlements that their property relations
original property regime. However, if they during marriage shall be governed by the
do so, no voluntary separation of property regime of separation of property, the
may be granted again. provisions of this Chapter shall be
suppletory.
Art. 142. The administration of all
classes of exclusive property of either Art. 144. Separation of property
spouse may be transferred by the court to may refer to present or future property or
the other spouse: both. It may be total or partial. In the
(1) When one spouse becomes the latter case, the property not agreed upon
guardian of the other; as separate shall pertain to the absolute
(2) When one spouse is judicially community.
declared an absentee;
(3) When one spouse is sentenced to Art. 145. Each spouse shall own,
a penalty which carries with it dispose of, possess, administer and enjoy
civil interdiction; or his or her own separate estate, without
(4) When one spouse becomes a need of the consent of the other. To each
fugitive from justice or is in spouse shall belong all earnings from his
hiding as an accused in a or her profession, business or industry
criminal case. and all fruits, natural, industrial or civil,
If the other spouse is not qualified due or received during the marriage from
by reason of incompetence, conflict of his or her separate property.
interest, or any other just cause, the court
shall appoint a suitable person to be the Art. 146. Both spouses shall bear
administrator. the family expenses in proportion to their
income, or, in case of insufficiency or
This article enumerates the instances when default thereof, to the current market
the court may transfer the administration of value of their separate properties.
all classes of exclusive property of either The liabilities of the spouses to
spouse. creditors for family expenses shall,
The following are the instances in when however, be solidary.
there can be a sole administrator of the
conjugal property:
1. If such is stipulated in the marriage of the other spouse. In the absence of such authority
settlement (Article 74) or consent, the disposition or encumbrance shall be
2. If the other spouse is unable to void. However, the transaction shall be construed as a
participate (Articles 96, 2 and 124, 2*) continuing offer on the part of the consenting spouse
and the third person, and may be perfected as a

Art. 74. The property relationship between husband binding contract upon the acceptance by the
and wife shall be governed in the following order: other spouse or authorization by the court before
(1) By marriage settlements executed before the the offer is withdrawn by either or both offerors.

marriage If a spouse without just cause abandons the other or
*
In the event that one spouse is incapacitated or fails to comply with his or her obligations to the family,
otherwise unable to participate in the administration of the aggrieved spouse may petition the court for
the common (conjugal) properties, the other spouse receivership, for judicial separation of property or for
may assume sole powers of administration. These authority to be the sole administrator of the absolute
powers do not include disposition or encumbrance community (conjugal partnership), subject to such
without authority of the court or the written consent precautionary conditions as the court may impose.

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Professor Ruben F. Balane Page 59 of 241
 F. Property Regime of Unions Without 3. The cohabitation is exclusive.
Marriage 4. The man and the woman are not
married to each other or are married to
According to Professor Balane, we should each other but the marriage is void.
not use the term common-law spouses Under Article 147, the property regime
simply because we are not a common law between the man and the woman would be
country. special co-ownership.
For Articles 147 and 148 to apply, the The special co-ownership covers:
persons living together as husband and wife 1. Wages and salaries of either the man and
must still be of different sexes. the woman
2. Property acquired through the work or
Art. 147. When a man and a industry of either or both
woman who are capacitated to marry If the partner did not acquire the
each other, live exclusively with each property directly, that partner's
other as husband and wife without the efforts must consist of the care and
benefit of marriage or under a void maintenance of the family and of the
marriage, their wages and salaries shall household in order for such party to
be owned by them in equal shares and the own 1/2 of the acquired property.
property acquired by both of them In Maxey vs. CA, the SC said that
through their work or industry shall be the co-ownership arises even if the
governed by the rules on co-ownership. common-law wife does not work is
In the absence of proof to the not gainfully employed. The
contrary, properties acquired while they common-law wife is still a co-owner
lived together shall be presumed to have since she ran the household and
been obtained by their joint efforts, work held the family purse even if she did
or industry, and shall be owned by them not contribute thereto.
in equal shares. For purposes of this The difference between this special co-
Article, a party who did not participate in ownership and the ordinary co-ownership is
the acquisition by the other party of any in Article 147, 3. In this special co-
property shall be deemed to have ownership, the following cannot be done:
contributed jointly in the acquisition 1. The co-ownership cannot be terminated
thereof if the former's efforts consisted in until the cohabitation is also terminated.
the care and maintenance of the family 2. The co-owner may not dispose or
and of the household. encumber his share in the property.
Neither party can encumber or
dispose by acts inter vivos of his or her Art. 148. In cases of cohabitation
share in the property acquired during not falling under the preceding Article,
cohabitation and owned in common, only the properties acquired by both of
without the consent of the other, until the parties through their actual joint
after the termination of their contribution of money, property, or
cohabitation. industry shall be owned by them in
When only one of the parties to a common in proportion to their respective
void marriage is in good faith, the share contributions. In the absence of proof to
of the party in bad faith in the co- the contrary, their contributions and
ownership shall be forfeited in favor of corresponding shares are presumed to be
their common children. In case of default equal. The same rule and presumption
of or waiver by any or all of the common shall apply to joint deposits of money and
children or their descendants, each evidences of credit.
vacant share shall belong to the If one of the parties is validly
respective surviving descendants. In the married to another, his or her share in
absence of descendants, such share shall the co-ownership shall accrue to the
belong to the innocent party. In all cases, absolute community or conjugal
the forfeiture shall take place upon partnership existing in such valid
termination of the cohabitation. marriage. If the party who acted in bad
faith is not validly married to another, his
Requisites of Article 147: or her shall be forfeited in the manner
1. The man and the woman must have provided in the last paragraph of the
capacity to marry each other. preceding Article.
2. The man and the woman cohabit.

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Professor Ruben F. Balane Page 60 of 241
 The foregoing rules on forfeiture This rules shall not apply to cases which
shall likewise apply even if both parties may not be the subject of compromise under the
are in both faith. Civil Code.

Article 148 governs live-in partners who do General Rule: For a suit between members of the
not fall under Article 147. same family shall prosper the following are
Article 148 will apply if: required:
1. The live-in partners do not have the 1. Earnest efforts towards a compromise have been
capacity to marry each other; or made
Example of this is that there is an 2. Such efforts have failed
impediment of relationship, crime 3. Such earnest efforts and the fact of failure must
or age. be alleged
2. The cohabitation is not exclusive. Without these 3, the case will be dismissed.
The special co-ownership only covers Exception: Cases which cannot be compromised.
property acquired by both parties through (Article 2035)
their actual joint contribution of money,
property or industry. This is very similar to Art. 2035. No compromise upon the
an ordinary partnership. following questions shall be valid:
If a live-in partner is legally married to (1) The civil status of persons;
someone else, the share of that live-in (2) The validity of a marriage or a legal
partner will accrue to the property regime of separation;
his or her existing valid marriage. (3) Any ground for legal separation;
If the party who acted in bad faith is not (4) Future support;
validly married to another his or her share (5) The jurisdiction of courts;
shall be forfeited to their common children (6) Future legitime.
or descendants. In the absence of
descendants, such share shall belong to the In Gayon vs. Gayon, the SC said that Article 151
innocent party. does not apply in the case of in-laws.
In the case of Magbaleta, the SC said that Article 151
XII. The Family does not apply if non-family members are to be sued
as well.
Art. 149. The family, being the
foundation of the nation, is a basic social XIII. Family Home
institution which public policy cherishes and
protects. Consequently, family relations are Art. 152. The family home, constituted
governed by law and no custom, practice or jointly by the husband and the wife or by an
agreement destructive of the family shall be unmarried head of a family, is the dwelling
recognized or given effect. house where they and their family reside, and
the land on which it is situated.
This is merely a declaration of policy.
Art. 153. The family home is deemed
Art. 150. Family relations include those: constituted on a house and lot from the time it is
(1) Between husband and wife; occupied as a family residence. From the time of
(2) Between parents and children; its constitution and so long as any of its
(3) Among brothers and sisters, whether of beneficiaries actually resides therein, the family
the full or half-blood. home continues to be such and is exempt from
execution, forced sale or attachment except as
This is an exclusive enumeration of family members. hereinafter provided and to the extent of the
value allowed by law.
Art. 151. No suit between members of the
same family shall prosper unless it should Art. 154. The beneficiaries of a family
appear from the verified complaint or petition home are:
that earnest efforts toward a compromise have (1) The husband and wife, or an unmarried
been made, but that the same have failed. If it is person who is the head of a family; and
shown that no such efforts were in fact made, (2) Their parents, ascendants, descendants,
the same case must be dismissed. brothers and sisters, whether the
relationship be legitimate or
illegitimate, who are living in the family

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Professor Ruben F. Balane Page 61 of 241
 home and who depend upon the head of hundred thousand pesos in rural areas, or such
the family for legal support. amounts as may hereafter be fixed by law.
In any event, if the value of the currency
Art. 155. The family home shall be changes after the adoption of this Code, the
exempt from execution, forced sale or value most favorable for the constitution of a
attachment except: family home shall be the basis of evaluation.
(1) For nonpayment of taxes; For purposes of this Article, urban areas
(2) For debts incurred prior to the are deemed to include chartered cities and
constitution of the family home; municipalities whose annual income at least
(3) For debts secured by mortgages on the equals that legally required for chartered cities.
premises before or after such All others are deemed to be rural areas.
constitution; and
(4) For debts due to laborers, mechanics, The value provided for Article 157 is unrealistic.
architects, builders, materialmen and According to Professor Balane, the judge should be
others who have rendered service or given discretion and adjust it accordingly.
furnished material for the construction There is a limit in terms of value provided for by the
of the building. law. Otherwise, debtors can evade creditors by
building very luxurious homes.
Art. 156. The family home must be part of
the properties of the absolute community or the Art. 158. The family home may be sold,
conjugal partnership, or of the exclusive alienated, donated, assigned or encumbered by
properties of either spouse with the latter's the owner or owners thereof with the written
consent. It may also be constituted by an consent of the person constituting the same, the
unmarried head of a family on his or her own latter's spouse, and a majority of the
property. beneficiaries of legal age. In case of conflict, the
Nevertheless, property that is the subject court shall decide.
of a conditional sale on installments where
ownership is reserved by the vendor only to This is a very dangerous article. Under this article,
guarantee payment of the purchase price may be the family home may not be sold, alienated, donated,
constituted as a family home. assigned or encumbered without the consent of the
person constituting the same, the latter's spouse and
The purpose of these provisions is to remove from a majority of the beneficiaries (see Article 154) who
the reach of creditors the residence in which the are of legal age. Therefore, a bank must get the
family members dwell social justice underpinnings consent of majority of the beneficiaries before the
The biggest change in the Family Code with regard family home may be mortgaged. How is the bank
to the family home is that the constitution of the supposed to know who the beneficiaries are? How is
family home shall be automatic once it is used as the the bank supposed to know if indeed the same is the
family dwelling. family home? Finally, how is the bank supposed to
General Rule: The family home is exempt from know how many of the beneficiaries are of legal age?
levy, attachment and execution. The title does not give you these pieces of
Exceptions: information. According to Professor Balane,
1. Non-payment of taxes creditors must be afforded some protection. This is
2. For debts incurred prior to the constitution of also disadvantageous to the owner since he may not
the family home sell the family home if the beneficiaries disagree.
If it were otherwise, then the antecedent
creditors would be prejudiced. Art. 159. The family home shall continue
3. For debts secured by mortgages on the premises despite the death of one or both spouses or of the
before or after the constitution unmarried head of the family for a period of ten
4. For debts due to laborers, mechanics, architects, years or for as long as there is a minor
builders, materialmen and others who have beneficiary, and the heirs cannot partition the
rendered service or furnished material for the same unless the court finds compelling reasons
construction of the building. therefor. This rule shall apply regardless of
Social justice whoever owns the property or constituted the
family home.
Art. 157. The actual value of the family
home shall not exceed, at the time of its The family home shall continue despite the death of
constitution, the amount of the three hundred one or both spouses or of the unmarried head of the
thousand pesos in urban areas, and two family:

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Professor Ruben F. Balane Page 62 of 241
 1. As long as there is a minor beneficiary still living 2 types of filiation
in the home 1. Natural
2. Even if there is no minor beneficiary, for a a. Legitimate
period of 10 years i. Legitimate proper (Article 164)
In this case, the heirs cannot partition the ii. Legitimated (Articles 167-172)
same unless the court finds compelling b. Illegitimate (Articles 165, 175, 176)
reasons. This rule shall apply regardless of 2. Adoption (R.A. No. 8552 (Domestic Adoption
whoever owns the property or constituted Act) and R.A. No. 8043 (Inter-country
the family home. Adoption Act))
3 Types of Legitimate Children
Art. 160. When a creditor whose claims is 1. Legitimate proper
not among those mentioned in Article 155 2. Legitimated
obtains a judgment in his favor, and he has 3. Adopted
reasonable grounds to believe that the family 2 Types of Illegitimate Children
home is actually worth more than the maximum a. Children of parents disqualified to marry each
amount fixed in Article 157, he may apply to the other at conception and marriage.
court which rendered the judgment for an order b. Children of parents qualified to marry each
directing the sale of the property under other
execution. The court shall so order if it finds Only this kind can be legitimated by
that the actual value of the family home exceeds subsequent marriage.
the maximum amount allowed by law as of the
time of its constitution. If the increased actual Art. 164. Children conceived or born
value exceeds the maximum allowed in Article during the marriage of the parents are
157 and results from subsequent voluntary legitimate.
improvements introduced by the person or Children conceived as a result of artificial
persons constituting the family home, by the insemination of the wife with the sperm of the
owner or owners of the property, or by any of the husband or that of a donor or both are likewise
beneficiaries, the same rule and procedure shall legitimate children of the husband and his wife,
apply. provided, that both of them authorized or
At the execution sale, no bid below the ratified such insemination in a written
value allowed for a family home shall be instrument executed and signed by them before
considered. The proceeds shall be applied first to the birth of the child. The instrument shall be
the amount mentioned in Article 157, and then to recorded in the civil registry together with the
the liabilities under the judgment and the costs. birth certificate of the child.
The excess, if any, shall be delivered to the
judgment debtor. A legitimate child is one conceived OR born during
the marriage of the parents.
Art. 161. For purposes of availing of the An innovation in the Family Code is the rule on
benefits of a family home as provided for in this artificial insemination.
Chapter, a person may constitute, or be the
3 Ways of Artificial Insemination
beneficiary of, only one family home.
i. Homologous artificial insemination
The husband's sperm is used. This is
Art. 162. The provisions in this Chapter
resorted to when the husband is impotent
shall also govern existing family residences
but not sterile.
insofar as said provisions are applicable.
ii. Heterologous artificial insemination
XIV. Paternity and Filiation The sperm of another man is used. This is
resorted to when the husband has a low
sperm count.
Paternity means the relationship or status of a
iii. Combined artificial insemination
person with respect to his or her child (paternity
includes maternity). A combination of the husband and another
man's sperm is used. This is resorted to for
Filiation means the status of a person with respect to
psychological reasons. The husband would
his or her parents.
not know which sperm fertilized the egg
Paternity and filiation implies relationship.
unless a DNA test is conducted. If the
husband knew that it was not his sperm, it
Art. 163. The filiation of children may be
may affect martial relations.
by nature or by adoption. Natural filiation may
What if the ovum of another woman is used? This is
be legitimate or illegitimate.
known as in vitro fertilization. This in not included

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Professor Ruben F. Balane Page 63 of 241
 in the coverage of the Family Code. A conservative way that sexual intercourse was
judge will therefore say that such child is not possible; or
illegitimate. (c) serious illness of the husband,
Requisites of a Valid and Legal Artificial which absolutely prevented sexual
Insemination intercourse;
1. Authorization or ratification of the insemination
by both husband and wife There must be a physical impossibility for the
Authorization occurs before the act. husband and the wife to have sexual intercourse for
Ratification occurs after the act. the 1st 120 days preceding the child's birth.
2. The authorization or ratification must be in If it takes 300 days for a child to be born, for a child
writing to be illegitimate, it must be shown the physical
3. The instrument must be executed and signed impossibility of the husband and wife to have sex
before the child's birth by both the husband and within the 1st 120 days.
the wife The physical impossibility must be for the ENTIRE
What if this is done after the 120 day period.
child's birth? The law is silent. These periods are not arbitrary since scientists know
that in order for a child to survive, there must be a 6
Art. 165. Children conceived and born month minimum period of gestation.
outside a valid marriage are illegitimate, unless Physical impossibility may be shown in 3 ways
otherwise provided in this Code. 1. Impotence of the husband
2. Spouses living separately
Art. 54. Children conceived or born If the husband is living in Makati, and the
before the judgment of annulment or absolute wife is living in Q.C., this is not what is
nullity of the marriage under Article 36 has contemplated by Article 166 (1)(b).
become final and executory shall be considered If the husband is living in Toronto, and the
legitimate. Children conceived or born of the wife is living in Manila, then it falls under
subsequent marriage under Article 53 shall Article 166 (1)(b).
likewise be legitimate. If one of the spouses is in jail, there is still
the possibility of sex since visits are allowed.
General Rule: If the child is conceived AND born 3. Serious illness which absolutely prevented sex
outside a valid marriage, the child is illegitimate. The illness must be such that sex is
Exceptions: impossible (i.e., comatose). TB is not an
1. Children of voidable marriages illness which causes an impossibility to have
2. Children of a void marriage in 2 instances sex (Andal vs. Macaraig).
a. Children conceived of a marriage void under NOTE: In these 3 instances, it is presumed that
Article 36 there is no artificial insemination. Also it is
b. Children conceived of a marriage under incumbent on the one impugning legitimacy that
Article 53 there could be no access.
Art. 166. Legitimacy of a child may be (2) That it is proved that for biological or
impugned only on the following grounds: other scientific reasons, the child could
not have been that of the husband,
The presumption of legitimacy is one of the except in the instance provided in the
strongest presumptions known in law. It is a quasi- second paragraph of Article 164; or
conclusive presumption since such presumption can
only be rebutted by certain instances in Article 166. Article 166 (2) assumes that there is no physical
impossibility. Otherwise, it would fall under Article
(1) That it was physically impossible for the 166 (1).
husband to have sexual intercourse DNA tests can show whether or not the husband is
with his wife within the first 120 days of the biological father of the child. In Lim vs. CA,
the 300 days which immediately Justice Romero in a obiter dictum said that DNA
preceded the birth of the child because tests are not yet accepted here.
of:
(a) the physical incapacity of the (3) That in case of children conceived
husband to have sexual through artificial insemination, the
intercourse with his wife; written authorization or ratification of
(b) the fact that the husband and wife either parent was obtained through
were living separately in such a

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Professor Ruben F. Balane Page 64 of 241
 mistake, fraud, violence, intimidation, 2. The child was born within the same 300 days
or undue influence. after the termination of the former marriage of
its mother
In case of artificial insemination, the written 3. The child was born before 180 days after the
authorization or ratification was procured by solemnization of its mother's 2nd marriage
mistake, fraud, violence, intimidation, or undue For the child to be considered the child of the 2 nd
influence. husband, the following requisites must concur:
1. The mother must have married again within 300
Art. 167. The child shall be considered days from the termination of the marriage
legitimate although the mother may have 2. The child was born within the same 300 days
declared against its legitimacy or may have been after the termination of its mother's first
sentenced as an adulteress. marriage
4. The child was born after 180 days following the
Despite the declaration of the mother that the child solemnization of its mother's second marriage
is illegitimate or that she has been declared an The first marriage must be terminated either by
adulteress, the presumption of legitimacy still death or annulment. Can the marriage refer to a
stands. This is so because in many instances, the marriage under Article 42? No, since the terms of
woman wouldn't know who the father of the child is this Article provide that the first marriage is
if she had multiple partners. Also, there are terminated. Under Article 42, it is the 2nd marriage
instances wherein a woman whose marriage has which is terminated.
turned sour will declare such in order to hurt the
pride of her husband. Art. 170. The action to impugn the
Presumptions: legitimacy of the child shall be brought within
1. Validity of the marriage one year from the knowledge of the birth or its
2. That the child is of the mother's (factual) recording in the civil register, if the husband or,
3. That the child is that of the husband in a proper case, any of his heirs, should reside
4. That the child was conceived during the in the city or municipality where the birth took
marriage place or was recorded.
Nos. 3 and 4 are hard to prove that's why If the husband or, in his default, all of his
presumptions come in. heirs do not reside at the place of birth as
defined in the first paragraph or where it was
Art. 168. If the marriage is terminated recorded, the period shall be two years if they
and the mother contracted another marriage should reside in the Philippines; and three years
within three hundred days after such if abroad. If the birth of the child has been
termination of the former marriage, these rules concealed from or was unknown to the husband
shall govern in the absence of proof to the or his heirs, the period shall be counted from the
contrary: discovery or knowledge of the birth of the child
(1) A child born before one hundred eighty or of the fact of registration of said birth,
days after the solemnization of the whichever is earlier.
subsequent marriage is considered to
have been conceived during the former Art. 171. The heirs of the husband may
marriage, provided it be born within impugn the filiation of the child within the
three hundred days after the period prescribed in the preceding article only in
termination of the former marriage; the following cases:
(2) A child born after one hundred eighty (1) If the husband should died before the
days following the celebration of the expiration of the period fixed for
subsequent marriage is considered to bringing his action;
have been conceived during such (2) If he should die after the filing of the
marriage, even though it be born within complaint without having desisted
the three hundred days after the therefrom; or
termination of the former marriage. (3) If the child was born after the death of
the husband.
180 days after 300 days after
Celebration of of 2General Rule:
st
the child of the 1celebration termination
Only theofhusband
1
nd
Termination of 1stto
For the child be considered st can impugn the
marriage 2nd marriage marriage legitimacy of the child. marriage
husband, the following requisites must concur:
1. The mother must have married again within 300 Exception: The heirs of the husband in the
days from the termination of her first marriage following cases
st 1. If the husband should die before the expiration
Child of the 1 Child of the 2nd
marriage of the period
marriage fixed for bringing his action

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Professor Ruben F. Balane Page 65 of 241
 2. If he should die after the filing of the complaint bibles, common reputation respecting
without having desisted therefrom or pedigree, testimony of witnesses, etc.)
3. If the child was born after the death of the Proof of filiation is very liberal because the
husband. law favors legitimacy. It is better to treat an
The husband or the heirs has the following years to illegitimate child as legitimate then to
impugn the legitimacy of the child: commit an error and treat a legitimate child
1. 1 year from knowledge of the birth or its as an illegitimate.
recording in the civil register, if the husband or
in a proper case, any of his heirs, should reside Art. 173. The action to claim
in the city or municipality where the birth took legitimacy may be brought by the child
place or recorded. during his or her lifetime and shall be
2. 2 years from knowledge of the birth or its transmitted to the heirs should the child
recording in the civil register, if the husband or die during minority or in a state of
in a proper case, any of his heirs, DO NOT reside insanity. In these cases, the heirs shall
in the city or municipality where the birth took have a period of five years within which to
place or recorded. institute the action.
3. 3 years from knowledge of the birth or its
recording in the civil register, if the husband or The right of the child to bring an action to
in a proper case, any of his heirs, live abroad claim legitimacy does not prescribe as long
NOTE: If the birth of the child has been concealed as he lives.
or was unknown to the husband or his heirs, the The child may bring such action even after
period shall be counted from the discovery or the lifetime of his parents.
knowledge of the birth of the child or of the fact of The right to file an action to claim legitimacy
the registration of the birth, whichever is earlier. may be transmitted by the child to the heirs
should the child die during minority or die
1. Proof of Filiation in a state of insanity or die during the
pendency of the case. If the right is
Art. 172. The filiation of legitimate transmitted by the child to the heirs, then
children is established by any of the the heirs will have 5 years to bring the
following: action.
(1) The record of birth appearing in
the civil register or a final 2. Illegitimate Children
judgment; or
(2) An admission of legitimate The rules in the Family Code were meant to
filiation in a public document or liberalize the rules of the NCC on
a private handwritten illegitimacy. In the NCC, recognition was
instrument and signed by the necessary in order to afford rights to the
parent concerned. illegitimate child. Under the Family Code,
In the absence of the foregoing there is no need for recognition. Now, proof
evidence, the legitimate filiation shall be of illegitimacy is sufficient.
proved by: The rule now is that the manner in which
(1) The open and continuous children may prove their legitimacy is also
possession of the status of a the same manner in which illegitimate
legitimate child; or children may prove their filiation (Article
(2) Any other means allowed by the 175).
Rules of Court and special laws.
The child may prove his illegitimate filiation
by bringing an action to claim illegitimate
Proof of filiation of a legitimate child is very filiation. The child has until his lifetime to
liberal: file such action unless the action is based on
1. Record of birth the open and continuous possession by the
2. Final judgment child of the status of an illegitimate child, or
3. Admission in a public document on other evidence allowed by the Rules of
4. Admission in a private handwritten Court. If the action is based on the open
instrument and signed by the said and continuous possession by the child of
parents the status of an illegitimate child, or on
5. Open and continuous possession of the other evidence allowed by the Rules of
status of a legitimate child Court, then the action must be brought
6. Any other means allowed by the Rules of within the lifetime of the alleged parent.
Court (i.e. baptismal certificate, family

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Professor Ruben F. Balane Page 66 of 241
 If the marriage occurs before the
Art. 176. Illegitimate children childs birth, then the child is
shall use the surname and shall be under legitimate (Article 164).
the parental authority of their mother, What if the marriage which takes
and shall be entitled to support in place after the childs birth is a
conformity with this Code. The legitime of voidable marriage? The child would
each illegitimate child shall consist of still be legitimated. A voidable
one-half of the legitime of a legitimate marriage is still a valid one until it is
child. Except for this modification, all declared void.
other provisions in the Civil Code
governing successional rights shall Art. 179. Legitimated children
remain in force. shall enjoy the same rights as legitimate
children.
The rights of illegitimate children are not the
same as the rights of a legitimate child. Art. 180. The effects of
An illegitimate child shall use the surname legitimation shall retroact to the time of
of the mother. Even if a couple, wherein the the child's birth.
man and the woman are capacitated to
marry each other but are not married, agree Art. 181. The legitimation of
that the child shall use surname of the man, children who died before the celebration
this is not allowed. All illegitimate children of the marriage shall benefit their
shall use the mothers surname. descendants.
Parental authority resides in the mother
alone. Art. 182. Legitimation may be
The illegitimate child has the right of impugned only by those who are
support. The order of preference for prejudiced in their rights, within five
legitimate and illegitimate children are not years from the time their cause of action
the same however. accrues.
An illegitimate child is entitled to only he
share of a legitimate child. 4. Domestic Adoption Act (Republic Act No.
8552)
3. Legitimation
The following are the important provisions:
Art. 177. Only children conceived
and born outside of wedlock of parents a. 7 (which superseded Articles 183-186
who, at the time of the conception of the of the Family Code)
former, were not disqualified by any
impediment to marry each other may be SECTION 7. Who May
legitimated. Adopt. The following may adopt:
(a) Any Filipino citizen of legal
Art. 178. Legitimation shall take age, in possession of full
place by a subsequent valid marriage civil capacity and legal
between parents. The annulment of a rights, of good moral
voidable marriage shall not affect the character, has not been
legitimation. convicted of any crime
involving moral turpitude,
Requisites of Legitimation: emotionally and
1. The child is illegitimate (Article 177). psychologically capable of
2. The parents at the time of the childs caring for children, at least
conception are not disqualified from sixteen (16) years older
marrying each other (Article 177). than the adoptee, and who
If the parents of the child are 16 and is in a position to support
15 years old at the latters and care for his/her
conception, the child may not be children in keeping with
legitimated. the means of the family.
3. There is a valid marriage subsequent to The requirement of sixteen
the childs birth (Article 178)

Art. 164, 1. Children conceived or born during the
marriage of the parents are legitimate.

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Professor Ruben F. Balane Page 67 of 241
 (16) year difference fourth (4th) degree of
between the age of the consanguinity or
adopter and adoptee may affinity of the Filipino
be waived when the adopter spouse; or
is the biological parent of (c) The guardian with respect
the adoptee, or is the to the ward after the
spouse of the adoptee's termination of the
parent; guardianship and clearance
(b) Any alien possessing the of his/her financial
same qualifications as accountabilities.
above stated for Filipino Husband and wife shall
nationals: Provided, That jointly adopt, except in the
his/her country has following cases:
diplomatic relations with (i) if one spouse seeks to adopt
the Republic of the the legitimate son/daughter
Philippines, that he/she has of the other; or
been living in the (ii) if one spouse seeks to adopt
Philippines for at least his/her own illegitimate
three (3) continuous years son/daughter: Provided,
prior to the filing of the However, that the other
application for adoption spouse has signified his/her
and maintains such consent thereto; or
residence until the (iii) if
adoption decree is entered, the spouses are legally
that he/she has been separated from each other.
certified by his/her In case husband and wife
diplomatic or consular jointly adopt, or one spouse adopts
office or any appropriate the illegitimate son/daughter of
government agency that the other, joint parental authority
he/she has the legal shall be exercised by the spouses.
capacity to adopt in his/her
country, and that his/her b. 8 (which superseded Article 187 of the
government allows the Family Code)
adoptee to enter his/her
country as his/her adopted SECTION 8. Who May Be
son/daughter: Provided, Adopted. The following may be
Further, That the adopted:
requirements on residency (a) Any person below eighteen
and certification of the (18) years of age who has
alien's qualification to been administratively or
adopt in his/her country judicially declared available
may be waived for the for adoption;
following: (b) The legitimate
(i) a former Filipino citizen son/daughter of one spouse
who seeks to adopt a by the other spouse;
relative within the (c) An illegitimate
fourth (4th) degree of son/daughter by a qualified
consanguinity or adopter to improve his/her
affinity; or status to that of legitimacy;
(ii) one who seeks to adopt (d) A person of legal age if,
the legitimate prior to the adoption, said
son/daughter of his/her person has been
Filipino spouse; or consistently considered and
(iii) treated by the adopter(s) as
one who is married to a his/her own child since
Filipino citizen and minority;
seeks to adopt jointly (e) A child whose adoption has
with his/her spouse a been previously rescinded;
relative within the or

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Professor Ruben F. Balane Page 68 of 241
 A child whose biological or provided by law to legitimate
adoptive parent(s) has died: sons/daughters born to them
Provided, That no proceedings without discrimination of any
shall be initiated within six (6) kind. To this end, the adoptee is
months from the time of death of entitled to love, guidance, and
said parent(s). support in keeping with the means
of the family.
c. 9 (which superseded Article 188 of the
Family Code) SECTION 18. Succession.
In legal and intestate succession,
SECTION 9. Whose the adopter(s) and the adoptee
Consent is Necessary to the shall have reciprocal rights of
Adoption. After being properly succession without distinction
counseled and informed of his/her from legitimate filiation. However,
right to give or withhold his/her if the adoptee and his/her
approval of the adoption, the biological parent(s) had left a will,
written consent of the following to the law on testamentary
the adoption is hereby required: succession shall govern.
(a) The adoptee, if ten (10)
years of age or over; e. 19 (which superseded Art. 191 and 192
(b) The biological parent(s) of of the Family Code)
the child, if known, or the
legal guardian, or the SECTION 19. Grounds for
proper government Rescission of Adoption. Upon
instrumentality which has petition of the adoptee, with the
legal custody of the child; assistance of the Department if a
(c) The legitimate and adopted minor or if over eighteen (18)
sons/daughters, ten (10) years of age but is incapacitated,
years of age or over, of the as guardian/counsel, the adoption
adopter(s) and adoptee, if may be rescinded on any of the
any; following grounds committed by
(d) The illegitimate the adopter(s): (a) repeated
sons/daughters, ten (10) physical and verbal maltreatment
years of age or over, of the by the adopter(s) despite having
adopter if living with said undergone counseling; (b) attempt
adopter and the latter's on the life of the adoptee; (c)
spouse, if any; and sexual assault or violence; or (d)
(e) The spouse, if any, of the abandonment and failure to
person adopting or to be comply with parental obligations.
adopted. Adoption, being in the best
interest of the child, shall not be
d. 16-18 (which superseded Art. 189 subject to rescission by the
and 190 of the Family Code) adopter(s). However, the
adopter(s) may disinherit the
SECTION 16. Parental adoptee for causes provided in
Authority. Except in cases Article 919 of the Civil Code.
where the biological parent is the
spouse of the adopter, all legal ties f. 20 (which superseded Art. 193 of the
between the biological parent(s) Family Code)
and the adoptee shall be severed
and the same shall then be vested SECTION 20. Effects of
on the adopter(s). Rescission. If the petition is
granted, the parental authority of
SECTION 17. Legitimacy. the adoptee's biological parent(s),
The adoptee shall be considered if known, or the legal custody of
the legitimate son/daughter of the the Department shall be restored
adopter(s) for all intents and if the adoptee is still a minor or
purposes and as such is entitled to incapacitated. The reciprocal
all the rights and obligations rights and obligations of the

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Professor Ruben F. Balane Page 69 of 241
 adopter(s) and the adoptee to each 2. Judicial that which is required to be given by
other shall be extinguished. court order whether pendente lite or in a final
The court shall order the judgment
Civil Registrar to cancel the 3. Voluntary or Conventional by agreement
amended certificate of birth of the An example of conventional support is as
adoptee and restore his/her follow. X donates land to Y. However X
original birth certificate. imposes a mode Y has to support Xs
Succession rights shall mother.
revert to its status prior to
adoption, but only as of the date of Characteristics of Support
judgment of judicial rescission. 1. Personal
Vested rights acquired prior to 2. Intransmissible
judicial rescission shall be 3. Not subject to waiver or compensation with
respected. regard to future support
All the foregoing effects of Support in arrears can be waived.
rescission of adoption shall be 4. Exempt from attachment or execution (Article
without prejudice to the penalties 205)
imposable under the Penal Code if 5. Reciprocal on the part of those who are by law
the criminal acts are properly bound to support each other (Article 195)
proven. 6. Variable (Articles 201 and 202)
Can an adopted child continue to be an heir Art. 195. Subject to the provisions of the
of his biological parents? Under Article 189 succeeding articles, the following are obliged to
of the Family Code, the adopted child was support each other to the whole extent set forth
still an heir of his blood relatives. However, in the preceding article:
Article 189 of the Family Code was (1) The spouses;
superseded by 16-18 of R.A. No. 8552. (2) Legitimate ascendants and
R.A. No. 8552 is silent on this point. descendants;
According to Professor Balane, one cannot (3) Parents and their legitimate children
use 16 as the basis for saying that the and the legitimate and illegitimate
adopted child cannot inherit from his children of the latter;
biological parents. 16 only talks about (4) Parents and their illegitimate children
parental authority. There is no reference to and the legitimate and illegitimate
succession. children of the latter; and
(5) Legitimate brothers and sisters,
XV. Support whether of full or half-blood
Art. 194. Support compromises Art. 196. Brothers and sisters not
everything indispensable for sustenance, legitimately related, whether of the full or half-
dwelling, clothing, medical attendance, blood, are likewise bound to support each other
education and transportation, in keeping with to the full extent set forth in Article 194, except
the financial capacity of the family. only when the need for support of the brother or
The education of the person entitled to be sister, being of age, is due to a cause imputable
supported referred to in the preceding to the claimant's fault or negligence.
paragraph shall include his schooling or training
for some profession, trade or vocation, even
beyond the age of majority. Transportation shall
Art. 205. The right to receive support under this
include expenses in going to and from school, or
Title as well as any money or property obtained as
to and from place of work.
such support shall not be levied upon on attachment or
execution.
Support comprises everything indispensable for
Art. 201. The amount of support, in the cases
sustenance, dwelling, clothing, medical attendance,
referred to in Articles 195 and 196, shall be in
education, and transportation, in keeping with the
proportion to the resources or means of the giver and
financial capacity of the family.
to the necessities of the recipient.
3 Kinds of Support Art. 202. Support in the cases referred to in
1. Legal that which is required to be given by law the preceding article shall be reduced or increased
proportionately, according to the reduction or increase
of the necessities of the recipient and the resources or
means of the person obliged to furnish the same.

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Professor Ruben F. Balane Page 70 of 241
 Illegitimate siblings, whether of full or half blood, illegitimate, the father has no parental authority.
are bound to support each other. However, they The illegitimate child will be behind legitimate
need not give support to an illegitimate, children and the spouse of his parent. Illegitimate
emancipated sibling whose need for support is children are in Article 199 (2) since there is no
imputable to his fault or negligence. distinction between legitimate and illegitimate.

Art. 199. Whenever two or more persons Art. 201. The amount of support, in the
are obliged to give support, the liability shall cases referred to in Articles 195 and 196, shall be
devolve upon the following persons in the order in proportion to the resources or means of the
herein provided: giver and to the necessities of the recipient.
(1) The spouse;
(2) The descendants in the nearest degree; Art. 202. Support in the cases referred to
(3) The ascendants in the nearest degree; in the preceding article shall be reduced or
and increased proportionately, according to the
(4) The brothers and sisters. reduction or increase of the necessities of the
recipient and the resources or means of the
Article 199 is important because it establishes the person obliged to furnish the same.
order of preference for the givers of support. When
a relative needs support, there are many relatives Support shall always be in proportion to the means
one can go after. That relative in need cannot choose of the giver and the necessities of the recipient.
but must follow the order established in this Article There is no res judicata as to the amount of support
199. to be given since support is variable.
If a parent needs support from his children, that
parent may chose any of the children. All of the Art. 203. The obligation to give support
children are solidarily liable. shall be demandable from the time the person
who has a right to receive the same needs it for
Art. 200. When the obligation to give maintenance, but it shall not be paid except from
support falls upon two or more persons, the the date of judicial or extrajudicial demand.
payment of the same shall be divided between Support pendente lite may be claimed in
them in proportion to the resources of each. accordance with the Rules of Court.
However, in case of urgent need and by Payment shall be made within the first
special circumstances, the judge may order only five days of each corresponding month or when
one of them to furnish the support provisionally, the recipient dies, his heirs shall not be obliged
without prejudice to his right to claim from the to return what he has received in advance.
other obligors the share due from them.
When two or more recipients at the same Support is demandable from the time the person
time claim support from one and the same who has the right to receive it needs it. However, it
person legally obliged to give it, should the latter is payable only from judicial or extrajudicial
not have sufficient means to satisfy all claims, demand.
the order established in the preceding article On April 1, X needed support from his father. Since
shall be followed, unless the concurrent obligees X is too proud, X doesnt ask. On July 1, X goes to
should be the spouse and a child subject to his father and asks him for support. The father
parental authority, in which case the child shall refuses. On Sept. 1, X files an action for support. On
be preferred. Oct. 1, the court renders judgment in favor of X.
When is the father obliged to give support? July 1
Article 200 establishes the order of preference for since there was extrajudicial demand.
recipients. When several relatives come to a
particular relative for support, the relative who will Art. 204. The person obliged to give
give support must follow Article 200. support shall have the option to fulfill the
If the relative who will give support has enough, he obligation either by paying the allowance fixed,
must give all those enumerated in Article 199. If the or by receiving and maintaining in the family
relative does not have enough, then the hierarchy dwelling the person who has a right to receive
enumerated in Article 199 must be followed. support. The latter alternative cannot be availed
An minor who is an illegitimate child asks support of in case there is a moral or legal obstacle
from his father. This illegitimate child will not be thereto.
preferred over the spouse of the father. Those who
will be preferred over the spouse of the father are The person obliged to render support may fulfill his
those children who are subject to the fathers obligation in 2 ways at his option:
parental authority. In this case, since the child is 1. Paying the amount fixed or

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Professor Ruben F. Balane Page 71 of 241
 2. Receiving and maintaining in the family Art. 209. Pursuant to the natural right
dwelling the person who has a right to receive and duty of parents over the person and
support property of their unemancipated children,
This 2nd option cannot be availed of when parental authority and responsibility shall
there is a moral or legal obstacle. For include the caring for and rearing them for civic
example, a husband in supporting his wife, consciousness and efficiency and the
cannot choose the 2nd option if he had been development of their moral, mental and physical
maltreating her (Goitia vs. Campos Rueda). character and well-being.

Art. 205. The right to receive support Parental authority terminates at the age of 18. This
under this Title as well as any money or property extends to both parental authority over the person
obtained as such support shall not be levied and the property of the child.
upon on attachment or execution.
Art. 210. Parental authority and
Art. 206. When, without the knowledge responsibility may not be renounced or
of the person obliged to give support, it is given transferred except in the cases authorized by
by a stranger, the latter shall have a right to law.
claim the same from the former, unless it
appears that he gave it without intention of being Art. 211. The father and the mother shall
reimbursed. jointly exercise parental authority over the
persons of their common children. In case of
Art. 207. When the person obliged to disagreement, the father's decision shall prevail,
support another unjustly refuses or fails to give unless there is a judicial order to the contrary.
support when urgently needed by the latter, any Children shall always observe respect and
third person may furnish support to the needy reverence towards their parents and are obliged
individual, with right of reimbursement from to obey them as long as the children are under
the person obliged to give support. This Article parental authority.
shall particularly apply when the father or
mother of a child under the age of majority Parental authority is joint. In case of disagreement,
unjustly refuses to support or fails to give the husbands decision prevails. However, the wife
support to the child when urgently needed. can go to court.
For illegitimate children, parental authority is not
Art. 208. In case of contractual support joint. It is with the mother
or that given by will, the excess in amount
beyond that required for legal support shall be Art. 212. In case of absence or death of
subject to levy on attachment or execution. either parent, the parent present shall continue
Furthermore, contractual support shall exercising parental authority. The remarriage of
be subject to adjustment whenever modification the surviving parent shall not affect the parental
is necessary due to changes of circumstances authority over the children, unless the court
manifestly beyond the contemplation of the appoints another person to be the guardian of
parties. the person or property of the children.

XVI. Parental Authority Art. 213. In case of separation of the

parents, parental authority shall be exercised by
Parental authority comes from patria potestas the parent designated by the Court. The Court
which means the fathers power. The woman was shall take into account all relevant
always dependent on a male figure whether it be her considerations, especially the choice of the child
husband, her father or her son. over seven years of age, unless the parent chosen
In Roman Law, patria potestas extended even to life is unfit.
and death. This power was granted to the father in
order to keep his family in check. Now, the present The 2nd paragraph of Article 213 provides that no
concept of parental authority is no longer focused on child under 7 years of age shall be separated from
the power aspect. Rather, the focus of parental the mother, unless the court finds compelling
authority is the obligational aspect. Parental reasons to order otherwise.
authority is given to the parents over their children In earlier cases, the mother was almost always the
in order for the children to be reared properly. The custodian of a child who is below 7 years. There is a
focus is on the child and the childs welfare. trend of liberalizing this. Courts will always look at
the best interest of the child as the criterion.

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Professor Ruben F. Balane Page 72 of 241
 Art. 214. In case of death, absence or
unsuitability of the parents, substitute parental Art. 217. In case of foundlings,
authority shall be exercised by the surviving abandoned neglected or abused children and
grandparent. In case several survive, the one other children similarly situated, parental
designated by the court, taking into account the authority shall be entrusted in summary judicial
same consideration mentioned in the preceding proceedings to heads of children's homes,
article, shall exercise the authority. orphanages and similar institutions duly
accredited by the proper government agency.
Art. 215. No descendant shall be
compelled, in a criminal case, to testify against Art. 218. The school, its administrators
his parents and grandparents, except when such and teachers, or the individual, entity or
testimony is indispensable in a crime against the institution engaged in child are shall have
descendant or by one parent against the other. special parental authority and responsibility
over the minor child while under their
Article 215 applies only in criminal cases and NOT in supervision, instruction or custody.
a civil case. Authority and responsibility shall apply
General Rule: A descendant cannot be compelled to all authorized activities whether inside or
in a criminal case to testify against his parents and outside the premises of the school, entity or
grandparents. institution.
Exception: A descendant can be compelled if such
testimony is indispensable in a crime against a Art. 219. Those given the authority and
descendant or by one parent against the other. responsibility under the preceding Article shall
NOTE: The criminal case need not be filed by the be principally and solidarily liable for damages
descendant or the parent. It may be filed by a 3 rd caused by the acts or omissions of the
person. Also, this rule applies only to compulsory unemancipated minor. The parents, judicial
testimony. It does not apply to voluntary testimony. guardians or the persons exercising substitute
Thus, the descendant can volunteer if he wants to. parental authority over said minor shall be
subsidiarily liable.
Art. 216. In default of parents or a The respective liabilities of those referred
judicially appointed guardian, the following to in the preceding paragraph shall not apply if it
person shall exercise substitute parental is proved that they exercised the proper
authority over the child in the order indicated: diligence required under the particular
(1) The surviving grandparent, as provided circumstances.
in Art. 214; All other cases not covered by this and the
(2) The oldest brother or sister, over preceding articles shall be governed by the
twenty-one years of age, unless unfit or provisions of the Civil Code on quasi-delicts.
disqualified; and
(3) The child's actual custodian, over Articles 218 and 219 apply ONLY to minors since the
twenty-one years of age, unless unfit or schools merely take the place of the parents.
disqualified. Rules:
Whenever the appointment or a judicial 1. Articles 218 and 219 are not limited to schools of
guardian over the property of the child becomes arts and trade, but are applicable to all schools.
necessary, the same order of preference shall be 2. Authority and responsibility apply to activities
observed. inside and outside provided the activity is an
authorized one (i.e., field trip)
In default of the parents or a judicial guardian, 3. The liability of the school administrators and the
substitute parental authority over the child shall be teacher is solidary and primary.
exercised in the order indicated: 4. The liability of the parents or the guardian is
1. The surviving grandparent subsidiary.
If there are several grandparents, then the 5. Negligence of the school administrators and the
guardian shall be the one designated by the teacher is presumed. The burden in on the
court pursuant to Articles 213 and 214 school administrator and the teacher to prove
2. The oldest brother or sister, over 21 years old, diligence under Article 219.
unless unfit or disqualified 6. The scope of the liability extends only to damage
3. The childs actual custodian, over 21 years old, caused by the child in the course of an
unless unfit or disqualified authorized school activity.
This custodian need not be a relative of the Rules Regarding Liability for Injuries Caused by
child, but he or she must have actual Students
custody.

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Professor Ruben F. Balane Page 73 of 241
 1. If the student who caused the injury is below 18, with the respect to their unemancipated
Articles 218 - 219 apply. children on wards the following rights
2. If the student who caused the injury is above 18, and duties:
Articles 218 - 219 do NOT apply. Article 2180 is (1) To keep them in their company,
applicable. to support, educate and instruct
Article 2180 is applicable to both academic and non- them by right precept and good
academic institutions. example, and to provide for their
1. Academic institutions the liability attaches to upbringing in keeping with their
the teacher means;
2. Non-academic institutions the liability (2) To give them love and affection,
attaches to the head of the establishment advice and counsel,
(Amadora vs. CA) companionship and
If a student is injured and the persons who caused understanding;
the injury were not students, Arts. 218, 219 of the (3) To provide them with moral and
Family Code and Art. 2180 of the Civil Code are not spiritual guidance, inculcate in
applicable. The school is liable in such a case based them honesty, integrity, self-
on the contract between the student and the school. discipline, self-reliance, industry
The school is supposed to provide the student and thrift, stimulate their
adequate protection (PSBA vs. CA). interest in civic affairs, and
inspire in them compliance with
1. Effect of Parental Authority Upon the the duties of citizenship;
Persons of the Children (4) To furnish them with good and
wholesome educational
Art. 220. The parents and those materials, supervise their
exercising parental authority shall have activities, recreation and
association with others, protect
them from bad company, and
Art. 2180. The obligation imposed by article 2176 prevent them from acquiring
is demandable not only for one's own acts or habits detrimental to their
omissions, but also for those of persons for whom one health, studies and morals;
is responsible.
(5) To represent them in all matters
The father and, in case of his death or
affecting their interests;
incapacity, the mother, are responsible for the
(6) To demand from them respect
damages caused by the minor children who live in their
company.
and obedience;
Guardians are liable for damages caused by (7) To impose discipline on them as
the minors or incapacitated persons who are under may be required under the
their authority and live in their company. circumstances; and
The owners and managers of an establishment (8) To perform such other duties as
or enterprise are likewise responsible for damages are imposed by law upon parents
caused by their employees in the service of the and guardians.
branches in which the latter are employed or on the
occasion of their functions. Art. 221. Parents and other
Employers shall be liable for the damages persons exercising parental authority
caused by their employees and household helpers shall be civilly liable for the injuries and
acting within the scope of their assigned tasks, even damages caused by the acts or omissions
though the former are not engaged in any business or of their unemancipated children living in
industry. their company and under their parental
The State is responsible in like manner when it authority subject to the appropriate
acts through a special agent; but not when the defenses provided by law.
damage has been caused by the official to whom the
task done properly pertains, in which case what is Art. 222. The courts may appoint a
provided in article 2176 shall be applicable. guardian of the child's property or a
Lastly, teachers or heads of establishments of guardian ad litem when the best interests
arts and trades shall be liable for damages caused by of the child so requires.
their pupils and students or apprentices, so long as
they remain in their custody. Art. 223. The parents or, in their
The responsibility treated of in this article shall absence or incapacity, the individual,
cease when the persons herein mentioned prove that
entity or institution exercising parental
they observed all the diligence of a good father of a
authority, may petition the proper court
family to prevent damage.

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Professor Ruben F. Balane Page 74 of 241
 of the place where the child resides, for The petition shall be docketed as a
an order providing for disciplinary summary special proceeding in which all
measures over the child. The child shall incidents and issues regarding the
be entitled to the assistance of counsel, performance of the obligations referred
either of his choice or appointed by the to in the second paragraph of this Article
court, and a summary hearing shall be shall be heard and resolved.
conducted wherein the petitioner and the The ordinary rules on
child shall be heard. guardianship shall be merely suppletory
However, if in the same except when the child is under substitute
proceeding the court finds the petitioner parental authority, or the guardian is a
at fault, irrespective of the merits of the stranger, or a parent has remarried, in
petition, or when the circumstances so which case the ordinary rules on
warrant, the court may also order the guardianship shall apply.
deprivation or suspension of parental
authority or adopt such other measures Art. 226. The property of the
as it may deem just and proper. unemancipated child earned or acquired
with his work or industry or by onerous
Art. 224. The measures referred or gratuitous title shall belong to the child
to in the preceding article may include in ownership and shall be devoted
the commitment of the child for not more exclusively to the latter's support and
than thirty days in entities or institutions education, unless the title or transfer
engaged in child care or in children's provides otherwise.
homes duly accredited by the proper The right of the parents over the
government agency. fruits and income of the child's property
The parent exercising parental shall be limited primarily to the child's
authority shall not interfere with the care support and secondarily to the collective
of the child whenever committed but shall daily needs of the family.
provide for his support. Upon proper
petition or at its own instance, the court Art. 227. If the parents entrust the
may terminate the commitment of the management or administration of any of
child whenever just and proper. their properties to an unemancipated
child, the net proceeds of such property
2. Effect of Parental Authority Upon the shall belong to the owner. The child shall
Property of the Children be given a reasonable monthly allowance
in an amount not less than that which the
Art. 225. The father and the owner would have paid if the
mother shall jointly exercise legal administrator were a stranger, unless the
guardianship over the property of the owner, grants the entire proceeds to the
unemancipated common child without child. In any case, the proceeds thus give
the necessity of a court appointment. In in whole or in part shall not be charged to
case of disagreement, the father's the child's legitime.
decision shall prevail, unless there is a
judicial order to the contrary. Parents may exercise parental authority over
Where the market value of the their childs property.
property or the annual income of the 2 Kinds of Properties of Minors
child exceeds P50,000, the parent 1. Adventitious (Article 226)
concerned shall be required to furnish a Adventitious property is earned or
bond in such amount as the court may acquired by the child through his
determine, but not less than ten per work or industry or by onerous or
centum (10%) of the value of the property gratuitous title.
or annual income, to guarantee the The child owns this property.
performance of the obligations The child is also is the usufructuary
prescribed for general guardians. as the child enjoys the fruits unless
A verified petition for approval of the mode of transfer provides
the bond shall be filed in the proper court otherwise. The fruits and income of
of the place where the child resides, or, if adventitious property must be
the child resides in a foreign country, in applied primarily for the childs
the proper court of the place where the support and secondarily for the
property or any part thereof is situated.

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Professor Ruben F. Balane Page 75 of 241
 familys collective needs (Article automatically reinstated upon service of
226, 2). the penalty or upon pardon or amnesty of
The property is administered by the the offender.
parents since the child has no
capacity to act. Art. 231. The court in an action
2. Profectitious (Article 227) filed for the purpose in a related case may
Profectitious property is owned by also suspend parental authority if the
the parents. However, this property parent or the person exercising the same:
is given to the child for him to (1) Treats the child with excessive
administer. For example, the harshness or cruelty;
parents may own a farm. Their (2) Gives the child corrupting
child is 17 years old. To teach him orders, counsel or example;
industry, the parents tell the child to (3) Compels the child to beg; or
harvest and take care of the farm. (4) Subjects the child or allows him
The parents own this type of to be subjected to acts of
property. lasciviousness.
The parents are the usufructuary. The grounds enumerated above
However, the child is entitled to a are deemed to include cases which have
monthly allowance which should be resulted from culpable negligence of the
not less than what the owner of the parent or the person exercising parental
property would have paid an authority.
administrator. The parents may If the degree of seriousness so
give the entire proceeds of the warrants, or the welfare of the child so
property to the child. demands, the court shall deprive the
The property is administered by the guilty party of parental authority or adopt
child. such other measures as may be proper
under the circumstances.
C. Suspension or Termination of Parental The suspension or deprivation
Authority may be revoked and the parental
authority revived in a case filed for the
Art. 228. Parental authority purpose or in the same proceeding if the
terminates permanently: court finds that the cause therefor has
(1) Upon the death of the parents; ceased and will not be repeated.
(2) Upon the death of the child; or
(3) Upon emancipation of the child. Art. 232. If the person exercising
parental authority has subjected the child
Art. 229. Unless subsequently or allowed him to be subjected to sexual
revived by a final judgment, parental abuse, such person shall be permanently
authority also terminates: deprived by the court of such authority.
(1) Upon adoption of the child;
(2) Upon appointment of a general Art. 233. The person exercising
guardian; substitute parental authority shall have
(3) Upon judicial declaration of the same authority over the person of the
abandonment of the child in a child as the parents.
case filed for the purpose; In no case shall the school
(4) Upon final judgment of a administrator, teacher of individual
competent court divesting the engaged in child care exercising special
party concerned of parental parental authority inflict corporal
authority; or punishment upon the child.
(5) Upon judicial declaration of
absence or incapacity of the Kinds of Termination and Suspension
person exercising parental 1. Irreversible Termination
authority. a. Death of the parents (Article 228
(1))
Art. 230. Parental authority is Parental authority is terminated
suspended upon conviction of the parent as far as the dead parent is
or the person exercising the same of a concerned.
crime which carries with it the penalty of b. Death of the child (Article 228 (2))
civil interdiction. The authority is c. Emancipation (Article 228 (3))

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Professor Ruben F. Balane Page 76 of 241
 This is the most common. (1) Is entitled to parental care;
d. Court order under Article 232 (2) Shall receive at least elementary
If the parent or parents education;
exercising parental authority (3) Shall be given moral and civic training
have subjected the child or by the parents or guardian;
allowed him or her to be (4) Has a right to live in an atmosphere
subjected to sexual abuse, the conducive to his physical, moral and
parent or parents shall be intellectual development.
deprived permanently by the
court of such parental authority. Art. 357. Every child shall:
2. Reversible Termination (the (1) Obey and honor his parents or
termination may or may not be guardian;
permanent) (2) Respect his grandparents, old relatives,
a. Upon adoption and persons holding substitute parental
It is reversible because there is a authority;
possibility that the adoption (3) Exert his utmost for his education and
may be rescinded. training;
b. Upon appointment of a guardian (4) Cooperate with the family in all matters
Guardianship may be lifted if that make for the good of the same.
such is no longer necessary
c. Judicial declaration of Art. 358. Every parent and every person
abandonment holding substitute parental authority shall see to
d. Final judgment of a competent court it that the rights of the child are respected and
under Article 231 his duties complied with, and shall particularly,
The grounds are: by precept and example, imbue the child with
i. Treats the child with highmindedness, love of country, veneration for
excessive harshness or the national heroes, fidelity to democracy as a
cruelty; way of life, and attachment to the ideal of
ii. Gives the child corrupting permanent world peace.
orders, counsel or example;
iii. Compels the child to beg; or Art. 359. The government promotes the
iv. Subjects the child or allows full growth of the faculties of every child. For
him or her to be subjected this purpose, the government will establish,
to acts of lasciviousness whenever possible:
e. Judicial declaration of absence or (1) Schools in every barrio, municipality
incapacity of the person and city where optional religious
3. Suspension of Parental Authority instruction shall be taught as part of the
a. Parent is convicted of a crime which curriculum at the option of the parent
carries with it the accessory penalty or guardian;
of civil interdiction (2) Puericulture and similar centers;
b. Court order under Article 231 (3) Councils for the Protection of Children;
and
The grounds are:
(4) Juvenile courts.
i. Treats the child with
excessive harshness or
Art. 360. The Council for the Protection
cruelty;
of Children shall look after the welfare of
ii. Gives the child corrupting
children in the municipality. It shall, among
orders, counsel or example;
other functions:
iii. Compels the child to beg; or
(1) Foster the education of every child in
iv. Subjects the child or allows
the municipality;
him or her to be subjected
(2) Encourage the cultivation of the duties
to acts of lasciviousness
of parents;
NOTE: Under Article 231, parental
(3) Protect and assist abandoned or
authority may be suspended or
mistreated children, and orphans;
terminated depending on the
(4) Take steps to prevent juvenile
seriousness of the ground.
delinquency;
(5) Adopt measures for the health of
XVII. Miscellaneous Provisions
children;
Art. 356. Every child:

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Professor Ruben F. Balane Page 77 of 241
 (6) Promote the opening and maintenance transaction and state the reason why the
of playgrounds; required consent thereto cannot be secured. In
(7) Coordinate the activities of any case, the final deed duly executed by the
organizations devoted to the welfare of parties shall be submitted to and approved by
children, and secure their cooperation. the court.
Art. 240. Claims for damages by either
Art. 361. Juvenile courts will be spouse, except costs of the proceedings, may be
established, as far as practicable, in every litigated only in a separate action.
chartered city or large municipality.
Art. 241. Jurisdiction over the petition
Art. 362. Whenever a child is found shall, upon proof of notice to the other spouse,
delinquent by any court, the father, mother, or be exercised by the proper court authorized to
guardian may in a proper case be judicially hear family cases, if one exists, or in the regional
admonished. trial court or its equivalent sitting in the place
where either of the spouses resides.
Art. 363. In all questions on the care,
custody, education and property of children the Art. 242. Upon the filing of the petition,
latter's welfare shall be paramount. No mother the court shall notify the other spouse, whose
shall be separated from her child under seven consent to the transaction is required, of said
years of age, unless the court finds compelling petition, ordering said spouse to show cause why
reasons for such measure. the petition should not be granted, on or before
the date set in said notice for the initial
Articles 356 to 363 of the Civil Code have not been conference. The notice shall be accompanied by
repealed by the Family Code. Most though are dead a copy of the petition and shall be served at the
letter law. last known address of the spouse concerned.
Article 363 is an important since this article deals
with the best interest of the child. Art. 243. A preliminary conference shall
The second sentence of Article 363 is found in the be conducted by the judge personally without the
second paragraph of Article 213 of the Family Code. parties being assisted by counsel. After the
The first sentence of Article 363 is still good law. initial conference, if the court deems it useful,
the parties may be assisted by counsel at the
XVIII. Summary Judicial Proceedings (Articles succeeding conferences and hearings.
238-252)
Art. 244. In case of non-appearance of
Art. 238. Until modified by the Supreme the spouse whose consent is sought, the court
Court, the procedural rules provided for in this shall inquire into the reasons for his failure to
Title shall apply as regards separation in fact appear, and shall require such appearance, if
between husband and wife, abandonment by one possible.
of the other, and incidents involving parental
authority. Art. 245. If, despite all efforts, the
attendance of the non-consenting spouse is not
Art. 239. When a husband and wife are secured, the court may proceed ex parte and
separated in fact, or one has abandoned the render judgment as the facts and circumstances
other and one of them seeks judicial may warrant. In any case, the judge shall
authorization for a transaction where the endeavor to protect the interests of the non-
consent of the other spouse is required by law appearing spouse.
but such consent is withheld or cannot be
obtained, a verified petition may be filed in court Art. 246. If the petition is not resolved at
alleging the foregoing facts. the initial conference, said petition shall be
The petition shall attach the proposed decided in a summary hearing on the basis of
deed, if any, embodying the transaction, and, if affidavits, documentary evidence or oral
none, shall describe in detail the said testimonies at the sound discretion of the court.
If testimony is needed, the court shall specify the
witnesses to be heard and the subject-matter of
Art. 213, 2. In case of separation of the parents, their testimonies, directing the parties to
parental authority shall be exercised by the parent present said witnesses.
designated by the Court. The Court shall take into
account all relevant considerations, especially the
Art. 247. The judgment of the court shall
choice of the child over seven years of age, unless the
be immediately final and executory.
parent chosen is unfit.

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 i. Land, buildings, roads, and
Art. 248. The petition for judicial constructions of all kinds
authority to administer or encumber specific adhered to the soil
separate property of the abandoning spouse and
to use the fruits or proceeds thereof for the In the case of Lopez vs. Orosa, a
support of the family shall also be governed by theater was constructed by
these rules. using lumber. The lumber
supplier was not paid. The
Art. 249. Petitions filed under Articles lumber supplier was contending
223, 225 and 235 of this Code involving parental his material mans lien extends
authority shall be verified. to the land. The SC said that the
material mans lien attaches
Art. 250. Such petitions shall be verified only to the building since a
and filed in the proper court of the place where building is an immovable
the child resides. property by itself.
In Associated Insurance vs. Iya,
Art. 251. Upon the filing of the petition, the SC said that the chattel
the court shall notify the parents or, in their mortgage over the house was
absence or incapacity, the individuals, entities or void since a house is an
institutions exercising parental authority over immovable and not chattel. On
the child. the other hand, in Tumalad vs.
Vicencio, the SC said that the
Art. 252. The rules in Chapter 2 hereof parties may treat the house as
shall also govern summary proceedings under chattel. The SC further added
this Chapter insofar as they are applicable. that the mortgagor is estopped
from assailing the validity of the
Summary judicial proceedings provided under the chattel mortgage over the house.
Family Code: How do you reconcile the
1. Declaration of presumptive death rulings of Associated Insurance
2. Partition of spouses property vs. Iya and Tumalad vs.
3. Disagreement in fixing domicile Vicencio? Tumalad vs. Vicencio
4. Disagreement in the exercise of profession applies only if no 3rd parties are
5. Disagreement in the administration of prejudiced.
community property Is it correct to say that the
6. Disagreement in the administration of conjugal Tumalad ruling tells us that a
property chattel mortgage over a building
7. Parental authority over foundlings is proper? No, it does not. A
chattel mortgage over a building
PROPERTY is always improper since a
building is always an
Property is any physical or incorporeal entity immovable. In Tumalad vs.
capable of becoming the object of a juridical relation. Vicencio, as between the parties,
the chattel mortgage is
Classification of Property (Castan) enforceable. The parties are
estopped from assailing the
I. According to Nature (Article 414) validity.
Grey Area in Associated
Art. 414. All things which are or may Insurance vs. Iya What if the
be the object of appropriation are considered 3rd party was aware of the
either: existence of the chattel
(1) Immovable or real property; or mortgage and despite such
(2) Movable or personal property. knowledge, the 3rd party entered
into the real estate mortgage?
1. Real or immovable (Article 415) According to Professor Balane,
4 Categories of Immovables there may be 2 ways of
a. Real by nature (Article 415, 1 and 8) answering this:
One can argue that the real
estate mortgage is valid
despite knowledge of the 3rd

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Professor Ruben F. Balane Page 79 of 241
 party. Thats probably why were not attached in fixed
the 3rd party entered into manner.
the real estate mortgage.
He knew that the chattel iii. Fertilizer actually used on a
mortgage is ineffective as piece of land
between 3rd parties.
One can argue that the 3 rd Growing fruits The fertilizer is
party is in bad faith (Articles real property since it becomes
19 and 20) an integral part of the soil.

ii. Mines, quarries and slag c. Real by destination (Article 415, s 4,

dumps, while the matter 5, 6 and 9)
thereof forms part of the bed,
and waters either running or i. Statues, reliefs, paintings or
stagnant other objects for use or
ornamentation, placed in
b. Real by incorporation (Article 415, buildings or on lands by the
s 2,3, and 7) owner of the immovable in
such manner that it reveals the
i. Trees, plants, and growing intention to attach them
fruits, while they are attached permanently to the tenements
to the land or form an integral
part of an immovable Requisites for Immobilization
1. It is an object of
Growing fruits and crops are ornamentation or object of
movables in other laws (i.e. use.
chattel mortgage law) 2. The object is placed on a
building or land.
ii. Everything attached to an 3. The installation was made
immovable in a fixed manner, by the owner of the building
in such a way that it cannot be or the land.
separated therefrom without 4. It is attached in such a
breaking the material or manner that it reveals an
deterioration of the object intention to attach it
permanently.
It is the result which is
important; that it cannot be ii. Machinery, receptacles,
removed without causing instruments or implements
damage. intended by the owner of the
There is no requirement that the tenement for an industry or
attachment be done by the works which may be carried on
owner (can be done by anyone). in a building or on a piece of
In Board of Assessments vs. land, and which tend directly
MERALCO, the MERALCO was to meet the needs of the said
assessed real property tax on its industry or works
electric poles. The theory was
that the same are real property Requisites for Immobilization
being adhered to the soil. The 1. The object must be either
SC said that the electric poles machinery, receptacles,
are not real property since they instruments or implements
can be removed. Such poles for an industry or work.
2. The object is installed in a

Art. 19. Every person must, in the exercise of his

tenement.
3. The installation is by the
rights and in the performance of his duties, act with
justice, give everyone his due, and observe honesty
owner of the tenement.
and good faith. 4. Industry or works are carried
Art. 20. Every person who, contrary to law, on in the tenement.
willfully or negligently causes damage to another, shall 5. The object carries out directly
indemnify the latter for the same. the industry or work.

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Professor Ruben F. Balane Page 80 of 241
 In Berkenkotter vs. Cu Unjieng, though the principal thing may
there was a real estate mortgage be damaged.
over the sugar central. Article 1678 does not answer
Additional machinery was when the machinery becomes
bought to increase the sugar immobilized in case the lessor
centrals capacity. The SC said decides to buy it. Is it
that the additional machinery immobilized upon installation
became immobilized under or upon purchase? Article 1678
Article 415 (5). Thus, the is not clear on this.
additional machinery is
included in the real estate iii. Animal houses, pigeon houses,
mortgage. beehives, fish ponds or
In Berkenkotter vs. Cu Unjieng, breeding places of similar
would it have made a difference nature, in case their owner has
if there was no stipulation that placed them or preserves them
the real estate mortgage would with the intention to have them
cover future improvements? permanently attached to the
No, the improvements would be land, and forming a permanent
covered automatically by law as part of it; the animals in these
the same are immobilized. Of places are included
course, the parties are free to
stipulate what may be excluded Requisites
from the mortgage. 1. The structure is placed by the
In Davao Saw Mill vs. Castillo, owner.
the machinery was installed by 2. The installation must be
the lessee. The contract of lease with the intention to have
stated that all improvements them permanently attached
introduced by the lessee except and forming a part of it.
machineries would belong to the The animals are real property
lessor after the expiration of the only for as long as they remain
lease contract. The SC said that there. Thus, if the pigeons fly
the machinery was not out of the pigeon house, then
immobilized under Article 415 they are no longer real property.
(5) since the same was installed
by the lessee and not the owner iv. Docks and structures which,
of the building or land. though floating, are intended
Suppose in Davao Saw Mill vs. by their nature and object to
Castillo, there was a provision remain at a fixed place on a
in the lease contract that the river, lake, or coast
machinery would pass to the
lessor. Would the machinery be d. Real by analogy (Article 415, 10)
immobilized? Yes, it would
since the lessor acts as an agent Contracts for public works,
of the owner (the owner installs and servitudes and other real
through the agent). rights over immovable
Suppose in Davao Saw Mill vs. property
Castillo, the lease contract was
silent on whether or not the In contracts for public works,
machinery would pass to the the contract itself is the real
lessor. Professor Balane is not property. For example, the
sure. He thinks that Article contract to build the EDSA
1678 may be applicable. Under flyover is real property in itself.
Article 1678, the lessor upon the In contracts for private works,
termination of the lease shall the contract is personal
pay of the value of the property.
improvements. Should the Real rights are those rights
lessor refuse to reimburse the which are enforceable against
improvements, then the lessee the whole world. (i.e.
may remove the same even ownership, possession in

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Professor Ruben F. Balane Page 81 of 241
 concept of holder, servitude, The distinction is also important in
mortgage). donations since the form will be
For a real right to be considered different.
real property, the real right
must be over an immovable II. According to Character of Ownership (Articles
property. For example, the real 419 - 425)
right of ownership of the land is
considered real property while Art. 419. Property is either of public
the real right of ownership over dominion or of private ownership.
a bag is considered personal
property. Art. 420. The following things are
property of public dominion:
2. Personal or movable (1) Those intended for public use, such as
roads, canals, rivers, torrents, ports
Art. 416. The following things and bridges constructed by the State,
are deemed to be personal property: banks, shores, roadsteads, and others
(1) Those movables susceptible of similar character;
of appropriation which are (2) Those which belong to the State,
not included in the preceding without being for public use, and are
article; intended for some public service or for
(2) Real property which by any the development of the national wealth.
special provision of law is
considered as personal Art. 421. All other property of the State,
property; which is not of the character stated in the
(3) Forces of nature which are preceding article, is patrimonial property.
brought under control by
science; and Art. 422. Property of public dominion,
(4) In general, all things which when no longer intended for public use or for
can be transported from public service, shall form part of the patrimonial
place to place without property of the State.
impairment of the real
property to which they are Art. 425. Property of private ownership,
fixed. besides the patrimonial property of the State,
provinces, cities, and municipalities, consists of
Art. 417. The following are also all property belonging to private persons, either
considered as personal property: individually or collectively.
(1) Obligations and actions
which have for their object 1. Public dominion
movables or demandable 2 Kinds of Property of the Public Dominion
sums; and a. Public use anyone can use (i.e.,
(2) Shares of stock of EDSA, Rizal Park)
agricultural, commercial and i. Property for public use may be
industrial entities, although owned by the state (Article 420 (1))
they may have real estate. ii. Property for public use may be
owned by LGUs political
Since Article 415 is exclusive, Articles subdivisions (Article 424)
416 and 417 are superfluous. b. Public service not for the general
Shares of stock (even if they shares of use but for some state function (i.e.,
stock of Ayala Land) are always personal government hospitals, Malcolm Hall)
property. Only the state may own property for
NOTE: The terms real property and public service (Article 420 (2))
personal property are common law There is no such thing as property
terms while immovable property and for public service for LGUs.
movable property are civil law terms. NOTE: The term public dominion is a
The distinction between immovable and civil law term while public domain is a
movable property is important in common law term. Strictly speaking,
mortgages (Lopez vs. Orosa, Associated they are not synonymous.
Insurance vs. Iya, and Tumalad vs. Characteristics of Property of the Public
Vicencio). Dominion

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Professor Ruben F. Balane Page 82 of 241
 1. Outside the commerce of man except for Philippines cannot refused.
purposes of repairs The SC should have
2. Not subject to prescription (because answered the question Is it
outside the commerce of man) possible for property owned
3. Cannot be levied upon (i.e. execution or by the government in a
attachment) foreign land to become
4. Cannot be burdened by any voluntary property of the public
easement dominion.
In Yakapin vs. CFI, the private lot was 2. Property of the public dominion
eroded by the sea. It eventually become part cannot be alienated without it
of the seabed. The SC said that the private being converted to patrimonial
lot became part of the public dominion since property. Once the property has
it is now part of the seabed. been converted, it is alienable.
In Government of the Philippines vs. 3. Roponggi has not been
Cabangis, the SC said that the land was converted to patrimonial
covered by a Torrens title will not protect the property. Conversion can only
land owner if the land becomes part of the take place by a formal
seabed de facto case of eminent domain. declaration. Such declaration
In Republic vs. CA, the SC said that the land cannot be implied.
did not become part of the public dominion. It is not clear if this formal
There was only a temporary inundation. declaration is an executive
Once the flood had subsided, the land or a legislative act.
became dry (see Article 458). 4. Patrimonial property can be
Creeks and forest land form part of the alienated only by an authority of
public dominion. law (legislature).

2. Private ownership b. Patrimonial property of LGUs

3 Kinds of Property of Private Ownership (political subdivisions)
a. Patrimonial property of the state
All property of the state which is not c. Patrimonial property of
of part of the public dominion is individuals
patrimonial property (Article 421).
Art. 423. The property of provinces,
Property of public dominion, when
cities, and municipalities is divided into
no longer intended for public use or
property for public use and patrimonial
for public service, shall form part of
property.
the patrimonial property of the State
(Article 422).
Art. 424. Property for public use, in the
Rulings in Laurel vs. Garcia
provinces, cities, and municipalities, consist of
(Roponggi case) the provincial roads, city streets, municipal
1. The Roponggi property is
streets, the squares, fountains, public waters,
property of the public dominion promenades, and public works for public service
since it is for public service.
paid for by said provinces, cities, or
According to Professor municipalities.
Balane, this has serious All other property possessed by any of
implications. Is it possible them is patrimonial and shall be governed by
for property owned by the this Code, without prejudice to the provisions of
government in a foreign special laws.
land to become property of
the public dominion? Properties of LGUs (Articles 423 and 424)
Public dominion connotes
1. Property for public use
sovereignty. In the case of
Property for public use consist of
Roponggi, Japan is the
roads, streets, squares, fountains,
sovereign authority. In this
public waters, promenades and
case the Philippines is only
public works for public service paid
a private land owner.
for by the LGUs (Article 424, 1)
Japan, being the sovereign,
2. Patrimonial property
can expropriate the
Roponggi property, and the All other property possessed by any
of them is patrimonial and shall be

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Professor Ruben F. Balane Page 83 of 241
 governed by the Civil Code, without
prejudice to the provisions of special VI. According to its Aptitude for Repeated Use
laws.
NOTE: According to Professor Balane, Art. 418. Movable property is either
certain decisions have eroded Articles consumable or nonconsumable. To the first
423 and 424. class belong those movables which cannot be
In Tan Toco vs. Municipal Council used in a manner appropriate to their nature
of Iloilo, a person levied on trucks, without their being consumed; to the second
police cars, police stations. The SC class belong all the others.
said that these could not be levied
since they were property for public 1. Consumable
use. According to Professor Balane, A thing is consumable if according to its
these are not properties for public nature, it cannot be used appropriately
use since not every in the general without being consumed.
public may use them. Following the
Civil Code, they are patrimonial 2. Non-Consumable
property. NOTE: The legal definition of consumable in Article
In Zamboanga del Norte vs. City of 1933 is wrong. The subject matter of a
Zamboanga, following the Civil commodatum may be a consumable or not. But, it
Code definition, all but 2 of the lots must be non-fungible since the exact, same thing
(playgrounds) are really patrimonial must be returned. In a mutuum, the obligor can
since there is LGUs cannot own return a different thing as long as it is of the same
property devoted for public service. kind and quality.
But that was not what the SC said.
VII. According to its Susceptibility to Division
III. According to Essential Form 1. Divisible
1. Corporeal
2. Indivisible
2. Incorporeal (i.e., shares of stock, goodwill in a The distinction is important in partition (either
business) physical or constructive partition)
The distinction is important for areas such as
mode of transfer VIII. According to its Existence in Time
1. Present res existens
IV. According to Designation
1. Specific 2. Future res futurae
The object is individually determined. For The distinction is important in sales. It is also
example, I promise to sell you my car with important in donations. A party cannot donate
license plate PME 208. future things. It is also important in succession.
A party cannot enter into a contract regarding
2. Generic future inheritance.
The object is determined only as to its kind.
For example, I promise to sell you 1000 kilos IX. According to its Dependence
of rice. 1. Principal
The distinction is important in legacies and
donations. The distinction is also important
in extinguishing obligations.
Art. 1933. By the contract of loan, one of the
parties delivers to another, either something not
V. According to its Susceptibility to Substitution consumable so that the latter may use the same for a
1. Fungible certain time and return it, in which case the contract is
Fungible means that the thing can be called a commodatum; or money or other consumable
substituted with another thing of the same thing, upon the condition that the same amount of the
kind or quality. This is determined by the same kind and quality shall be paid, in which case the
INTENT of the parties. For example, if A contract is simply called a loan or mutuum.
borrows a book from B, it may be the Commodatum is essentially gratuitous.
intention of the parties that B return the Simple loan may be gratuitous or with a
exact same book since it has As annotations. stipulation to pay interest.
In commodatum the bailor retains the
2. Non-Fungible ownership of the thing loaned, while in simple loan,
ownership passes to the borrower.

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Professor Ruben F. Balane Page 84 of 241
 2. Accessory 6. ius vindicandi the right of action available
The general rule is that the accessory follows the to the owner to recover the property against
principal. An exception to the general rules is the holder or possessor
reverse accession (Article 120, Family Code). 7. ius accessions the right to accessions
The distinction is important in sales. When one Characteristics of Ownership
buys a car, the car should include the accessories 1. General (Article 428)
such as the spare tire, the radio, etc. The
distinction is also important in lease contracts. Art. 428. The owner has the
right to enjoy and dispose of a thing,
Bundle of Rights without other limitations than those
established by law.
I. Ownership The owner has also a right of
action against the holder and
Art. 427. Ownership may be exercised possessor of the thing in order to
over things or rights. recover it.

Ownership is the independent and general right The owner may use the thing in all its
of a person to control a thing in its possession, possibility subject to restrictions. For
enjoyment, disposition and recovery subject to example, an owner is not limited in
no restrictions except those validly imposed by using a bag merely as a place where
the state or by juridical transactions. goods are kept. The owner may use the
In Roman Law, ownership was an absolute right. bag as a hat.
Ownership is evolving in light of social justice, 2. Independent
police power in order to promote the welfare of Ownership can exist even without any
the people and environmental concerns. Now, other right.
we have concepts such as stewardship. Now, 3. Abstract
one must comply with safety and environmental The right of ownership exists distinctly
regulations. Now, building permits are required. from its constituent or component parts
Ownership is accompanied by the following (i.e. ius accessions, ius abutendi, etc).
rights (Phil. Banking vs. Lui She): 4. Elastic
1. ius possidendi the right to possess The component rights can be reduced or
2. ius utendi the right to use given to others (i.e. usufruct the right
3. ius fruendi the right to enjoy the fruits to enjoy the fruits).
4. ius abutendi the right to destroy (but 5. Exclusive
cannot harm others) There can only be 1 ownership at one
5. ius disponendi the right to dispose, or the time.
right to alienate, encumber, transform In co-ownership, there is only 1
ownership, but this is shared ownership.
6. Generally Perpetual
Art. 120. The ownership of improvements, whether
Ownership is generally not limited as to
for utility or adornment, made on the separate
time unless there is stipulation to the
property of the spouses at the expense of the
contrary.
partnership or through the acts or efforts of either or
both spouses shall pertain to the conjugal partnership, Ownership is inherently unlimited, but
or to the original owner-spouse, subject to the it is not necessarily so. Ownership can
following rules: be restricted. These restrictions on
When the cost of the improvement made by ownership may be imposed by the State
the conjugal partnership and any resulting increase in or by juridical transactions (i.e.
value are more than the value of the property at the contract). In several cases, the SC has
time of the improvement, the entire property of one of upheld the validity of deed restrictions
the spouses shall belong to the conjugal partnership, with regard to how buildings are to be
subject to reimbursement of the value of the property constructed.
of the owner-spouse at the time of the improvement;
otherwise, said property shall be retained in ownership Art. 429. The owner or lawful
by the owner-spouse, likewise subject to possessor of a thing has the right to exclude
reimbursement of the cost of the improvement. any person from the enjoyment and disposal
In either case, the ownership of the entire thereof. For this purpose, he may use such
property shall be vested upon the reimbursement, force as may be reasonably necessary to repel
which shall be made at the time of the liquidation of or prevent an actual or threatened unlawful
the conjugal partnership.

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Professor Ruben F. Balane Page 85 of 241
 physical invasion or usurpation of his In Lunod vs. Meneses, the owner of the lower
property. tenement created a structure impeding the flow
of water from the upper tenement to the lower
This is known as the doctrine of self-help. tenements. Thus, the upper tenements were
This is one of the instances in which a person is flooded. SC said that a person could enclose his
allowed to take the law into his own hands and property to obstruct the natural flow of waters
to use force. Normally, the use of violence is from the upper tenements.
reserved to the sovereign power of the state.
Article 429 is similar to Article 11, 4 * of the Art. 431. The owner of a thing cannot
Revised Penal Code. make use thereof in such manner as to injure
Requisites the rights of a third person.
1. Person who employs force or violence must
be the owner (actual or presumed) or a The owner may use property only in such a
lawful possessor manner that it does not injure others sic utere
2. That person must be in actual physical tuo ut alienum non laedas.
possession This encapsulates everything in the law on
The right in Article 429 is a possessory things.
right only.
A owns land in Nasugbu. A sees Bs Art. 432. The owner of a thing has no
goons. B tells A to get out. A right to prohibit the interference of another
successfully thwarts the invasion. Bs with the same, if the interference is
goons are injured. Can A be successfully necessary to avert an imminent danger and
charged with physical injuries? No, if the threatened damage, compared to the
reasonable force was used. damage arising to the owner from the
In the same example, Bs goons succeeds interference, is much greater. The owner
in throwing out A. A comes back and may demand from the person benefited
inflicts force. Is this allowed? No, A is indemnity for the damage to him.
not in physical possession of the land.
As remedy is to go to court under This is basically the same rule as Article 11, 44
Article 433. of the Revised Penal Code prevention of a
3. There must be actual or imminent aggression greater injury.
4. Only reasonable force is Requisites:
employed by the owner or lawful possessor 1. The interference must be necessary to avert
imminent danger.
Art. 430. Every owner may enclose or 2. The threatened damage must be greater
fence his land or tenements by means of than the damage caused to the owner.
walls, ditches, live or dead hedges, or by any 3. Only such interference as is necessary shall
other means without detriment to servitudes be made in order to avert the damage.
constituted thereon. An example of Article 432 is a case in criminal
law. In that case a car was burning near a gas
The right of an owner to enclose his tenement is station. The car was pushed away from the gar
limited by the servitudes existing on it. station. However in the process, a house was
burned.
*
Article 11. Justifying circumstances. The following
B is running away from drug addicts. B passes a
do not incur any criminal liability: house. B smashes the door and is able to save
4. Any person who, in order to avoid an evil or himself. Bs actions are justified. B is not guilty
injury, does an act which causes damage to of malicious mischief since B was trying to
another, provided that the following requisites prevent injury to himself.
are present: General Rule: Compensation may be
First. That the evil sought to be demanded by the property owner.
avoided actually exists; Exception: No compensation if the injury is
Second. That the injury feared be caused by the property owner and the person
greater than that done to avoid it; who intervened was not at fault.
Third. That there be no other practical B is drunk. B is walking home and singing
and less harmful mean of preventing it. Bayan Ko. B passes Js house. J has a

Art. 433. Actual possession under claim of Doberman. The Doberman attacks B. B stabs
ownership raises disputable presumption of ownership. the Doberman with a Swiss army knife. Did B
The true owner must resort to judicial process for the act under Article 432? Yes. Does B have to pay?
recovery of the property.

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Professor Ruben F. Balane Page 86 of 241
 No, because the danger came from the property interest in the real property which is
itself, the Doberman, and it was not Bs fault. the subject matter of the action. He
B sees Doberman sleeping. B starts shouting at need not be in possession of said
the Doberman. B kicks the dog. Dog attacks B. property.
B stabs the dog. B is justified in killing the dog
under Article 432. B has a right to defend Art. 478. There may also be an
himself. However, B has to pay J since B action to quiet title or remove a cloud
provoked the dog. therefrom when the contract,
instrument or other obligation has
Art. 433. Actual possession under been extinguished or has terminated,
claim of ownership raises disputable or has been barred by extinctive
presumption of ownership. The true owner prescription.
must resort to judicial process for the
recovery of the property. Art. 479. The plaintiff must
return to the defendant all benefits he
Assuming that the possessor claiming the may have received from the latter, or
ownership is illegitimate, the true owner (not in reimburse him for expenses that may
possession) must go to court. He cannot apply have redounded to the plaintiff's
the doctrine of self-help under Article 429 since benefit.
he is not in possession. Article 433 applies when
the plaintiff is not in possession of the property. Art. 480. The principles of the
Remedies general law on the quieting of title are
1. Action for forcible entry hereby adopted insofar as they are not
The action of forcible entry is for the in conflict with this Code.
recovery of the material or physical
possession and must be brought in the Art. 481. The procedure for the
MTC within 1 year from the date of the quieting of title or the removal of a
forcible entry. cloud therefrom shall be governed by
2. Accion publiciana such rules of court as the Supreme
A plenary action for the recovery of the Court shall promulgated.
possession of real estate, upon mere
allegation and proof of a better right Like accion publiciana, it involves only
thereto, and without allegation of proof real property and is either curative or
of title. This action can only be brought preventive. Unlike accion publiciana,
after the expiration of 1 year. quieting of title applies to both
3. Accion reivindicatoria ownership and possession. In quieting
An action whereby the plaintiff alleges of title, the complaint must allege the
ownership over a parcel of land and existence of an apparently valid or
seeks recovery of its possession. effective instrument or other claim
4. Quieting of title which is in reality void, ineffective,
voidable or unenforceable.
Art. 476. Whenever there is a Article 476 seems to interchange
cloud on title to real property or any removal of a cloud with quieting of title.
interest therein, by reason of any In common law, there is a distinction.
instrument, record, claim, Under common law, an action to quiet
encumbrance or proceeding which is title must set forth an adverse claim, but
apparently valid or effective but is in it must not be specific. Only a general
truth and in fact invalid, ineffective, claim is made. An action to remove a
voidable, or unenforceable, and may cloud requires a specific claim.
be prejudicial to said title, an action Article 476 can either be a preventive
may be brought to remove such cloud (2) or a remedial action (1).
or to quiet the title. Quieting of title is a quasi in rem action.
An action may also be brought If the plaintiff in an action to quiet title
to prevent a cloud from being cast is in possession of the property, then the
upon title to real property or any action to quiet title is imprescriptible
interest therein. (Faya vs. CA).
As long as a person is in possession of the
Art. 477. The plaintiff must property, it is presumed that the person in
have legal or equitable title to, or possession is the owner. The burden is on the

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Professor Ruben F. Balane Page 87 of 241
 challenger to prove otherwise. The 1st sentence If the state wants to do research on germ
of Article 433 is similar to Article 541. warfare, and the state takes the socks and its
However, under Article 1131 for purposes of germs, the state should compensate P.
prescription, just title is not presumed. If one
seeks to acquire title by prescription, the burden Art. 437. The owner of a parcel of
is on the applicant claiming to be the owner. In land is the owner of its surface and of
Article 1131, it is the possessor who is the everything under it, and he can construct
applicant. The possessor is the one who has the thereon any works or make any plantations
burden to prove that he acquired the property and excavations which he may deem proper,
through prescription. It is not presumed. In without detriment to servitudes and subject
Articles 433 and 541, the possessor does not to special laws and ordinances. He cannot
claim to own it by prescription. The possessor complain of the reasonable requirements of
takes a defensive stance. aerial navigation.

Art. 434. In an action to recover, the In Roman law there is an old saying, Cujus est
property must be identified, and the plaintiff solum, ejus est usque ad coelum et ad inferos
must rely on the strength of his title and not (the owner of a piece of land owns everything
on the weakness of the defendant's claim. above and below it to an indefinite extent).
This is not true anymore. Otherwise, airplanes
Two things must be proved in an accion would commit aerial trespass. However, it
reivindicatoria: cannot be denied that the landowner owns the
1. The identity of the property land, the earth and the air. Otherwise, his
2. Plaintiffs title to it ownership is useless. Where do you draw the
balance? The property owner owns the space
Art. 435. No person shall be deprived and subsoil as far as is necessary for his practical
of his property except by competent interest and ability to assert dominion. Beyond
authority and for public use and always upon this, the owner has nothing. This would depend
payment of just compensation. on a case to case basis.
Should this requirement be not first
complied with, the courts shall protect and, Art. 438. Hidden treasure belongs to
in a proper case, restore the owner in his the owner of the land, building, or other
possession. property on which it is found.
Nevertheless, when the discovery is
This is not really part of civil law. This is merely made on the property of another, or of the
an adoption of the Constitutional provision on State or any of its subdivisions, and by
eminent domain. chance, one-half thereof shall be allowed to
the finder. If the finder is a trespasser, he
Art. 436. When any property is shall not be entitled to any share of the
condemned or seized by competent authority treasure.
in the interest of health, safety or security, If the things found be of interest to
the owner thereof shall not be entitled to science of the arts, the State may acquire
compensation, unless he can show that such them at their just price, which shall be
condemnation or seizure is unjustified. divided in conformity with the rule stated.

Under police power, the state deprives the Art. 439. By treasure is understood,
individual of the property without just for legal purposes, any hidden and unknown
compensation. deposit of money, jewelry, or other precious
P has a pair of socks which he has been wearing objects, the lawful ownership of which does
for 7 months. It is spreading numerous diseases. not appear.
The state can take the pair of socks to burn. In
doing so, there is no need for compensation. If you find treasure in your land, the treasure is
yours.
When a person finds treasure in a land that is

Art. 541. A possessor in the concept of owner has in not his, goes to the finder and goes to the
his favor the legal presumption that he possesses with owner of the land, building or other property.
a just title and he cannot be obliged to show or prove Requisites When a Person Finds Treasure in a
it. Land That is Not His

Art. 1131. For the purposes of prescription, just title 1. The deposit must be hidden and unknown
must be proved; it is never presumed. (Article 439).

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Professor Ruben F. Balane Page 88 of 241
 2. There is no lawful owner. General Rule: Fruits belong
3. Discovery is by chance (Article 438). to the owner.
There is debate as to what chance Exception: The fruits do not
means. One school of thought thinks belong to the owner in the
that chance means there was an intent following instances:
to find treasure except that finding it 1. Possessor in good faith
was serendipitous. Another school of (Article 544)
thought is that the finder should not 2. Usufruct
have no intentions in the first place to 3. Lease
look for treasure. 4. Antichresis
4. Discoverer must not be a trespasser. (Article 2132)
5. Pledge
Accession
Accession is not a mode of ownership. It is a B. Accession continua
mere concomitant right of ownership. It is a The right pertaining to the owner of
mere incident or consequence of ownership. a thing over everything that is
incorporated or attached thereto
Art. 440. The ownership of either naturally or artificially.
property gives the right by accession 1. Immovables
to everything which is produced a. Industrial (Articles 445-456)
thereby, or which is incorporated or
attached thereto, either naturally or Art. 445. Whatever
artificially. is built, planted or sown on
the land of another and the
The law wisely does not define accession. It improvements or repairs
merely tells us what accession does. made thereon, belong to
2 Kinds of Accession the owner of the land,
A. Accession discreta subject to the provisions of
The right pertaining to the owner of the following articles.
a thing over everything produced
thereby (Article 442) Art. 446. All works,
1. Natural fruits sowing, and planting are
Natural fruits are the presumed made by the
spontaneous products of the owner and at his expense,
soil, and the young and other unless the contrary is
products of animals. proved.
B owns a male German
Shepherd. M owns a female i. Building
German Shepherd. The 2 dogs ii. Planting
breed. To whom does the litter iii. Sowing
go? To the female since birth (Note: I also included Dean Cynthia Roxas-del
follows the womb (partus Castillos charts in our civil law reviewer since those
requites ventreim). charts are more complete. However, I retained
2. Industrial fruits Professor Balanes charts since they are better as
Industrial fruits are those memory aids. Dean del Castillos charts come first.)
produced by lands of any kind

through cultivation or labor. Art. 544. A possessor in good faith is entitled to the
3. Civil fruits fruits received before the possession is legally
Civil fruits are the rents of interrupted.
buildings, the price of leases of Natural and industrial fruits are considered
lands and other property and received from the time they are gathered or severed.
the amount of perpetual or life Civil fruits are deemed to accrue daily and
annuities or other similar belong to the possessor in good faith in that
income. proportion.

Stock dividends are civil fruits Art. 2132. By the contract of antichresis the
being surplus profit (Bachrach creditor acquires the right to receive the fruits of an
vs. Seifert). immovable of his debtor, with the obligation to apply
them to the payment of the interest, if owing, and
thereafter to the principal of his credit.

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 89 of 241
 2. Right to
1st case: materials
Landowner is the builder/planter/sower and is Bad Faith Good Faith
using the materials of another. 1. Right to
materials
Art. 447. The owner of the land who 2. Absolute
makes thereon, personally or through another, construct
plantings, constructions or works with the Good Faith Bad Faith
materials of another, shall pay their value; and, Right to acquire the improvements without
if he acted in bad faith, he shall also be obliged to paying indemnity plus damages
the reparation of damages. The owner of the Bad Faith Bad Faith
materials shall have the right to remove them (Same as though acted in good faith under (Same as th
only in case he can do so without injury to the Article 453) Article 453)
work constructed, or without the plantings,
constructions or works being destroyed. The land owner builder/planter/sower is in good
However, if the landowner acted in bad faith, the faith if he believes that the land belongs to him and
owner of the materials may remove them in any he is ignorant of any defect or flaw in his title and he
event, with a right to be indemnified for does not know that he has no right to use such
damages. materials. But when his good faith is coupled with
negligence, he is liable for damages.
LANDOWNER IS THE The land owner builder/planter/sower is in bad
BUILDER/PLANTER/SOWER faith if he makes use of the land or materials which
Good Faith Good Faith he knows belong to another.
Has the: The owner of the materials is in good faith if he did
Can acquire the materials provided he pays for 1. Right to receive payment
not know for valuewas
that another of using
the his materials, or
the value thereof. materials; ORgranting that he did know, if he informed the user of
2. Limited rightthe of ownership
removal if and
theremade
would
thebe no
necessary prohibition.
injury to work constructed, or without
The owner of the materials is in bad faith if he allows
plantings or constructions being destroyed
another to use the materials without informing him
(Article 447)
of the ownership thereof.
Bad Faith Good Faith
Indemnification for damages shall comprehend not
Has the:
only the value of the loss suffered but also that of the
Can acquire the materials provided he pays the 1. Right to receive payment for value of
profits which the obligee failed to realize.
value thereof plus damages. materials plus damages; OR
Problem:
of removal May of thetheworkland owner
2. Absolute right
builder/planter/sower
constructed in any event (whether or notchoose to return the materials
instead of reimbursing their value even without the
substantial injury is caused) plus damages
consent of the owner of the materials?
Good Faith Bad Faith
It depends:
Can acquire the materials without paying for the Loses the materials completely without receiving
1. If no damage has been made to the materials, or
value thereof and entitled to consequential any indemnity
they have not been transformed as a result of the
damages due to the defects of the materials
construction, they may be returned at the land
Bad Faith Bad Faith
owners expense.
Treat as if both are in good faith. 2. If damage has been made or there has been
transformation, they cannot be returned
LAND OWNER IS BUILDER/PLANTER/SOWER anymore.
Good Faith Good Faith Problem: Suppose the land owner
1. Limited rightbuilder/planter/sower
of removal if there would
has be no
already demolished or
injury to workremoved constructed, orconstructions
the plantings, without or works, is the
plantings orowner
constructions being still
of the materials destroyed
entitled to claim them?
(Article 447);There
or are different opinions on this matter but the
best rule seems to be that the OM is still entitled to

Art. 453. If there was bad faith, not only on the part get them since the law makes no distinction.
of the person who built, planted or sowed on the land Moreover, the land owner may insist on returning
of another, but also on the part of the owner of such them for evidently there is no accession.
land, the rights of one and the other shall be the same
as though both had acted in good faith. 2nd case:
It is understood that there is bad faith on the Builder/Planter/Sower builds, plants, or sows
part of the landowner whenever the act was done with on anothers land using his own materials.
his knowledge and without opposition on his part.

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 90 of 241
 on purchasin
Art. 448. The owner of the land on which
anything has been built, sown or planted in good Good Faith Bad Faith
faith, shall have the right to appropriate as his Has the option:
own the works, sowing or planting, after 1. To acquire whatever has been built, planter or Loses what h
payment of the indemnity provided for in sown without paying for indemnity except
articles 546 and 548, or to oblige the one who necessary expenses for the preservation of the Entitled to re
built or planted to pay the price of the land, and land only and luxurious expenses if he for the preser
the one who sowed, the proper rent. However, decides to acquire the luxurious ornaments retention.
the builder or planter cannot be obliged to buy plus damages
the land if its value is considerably more than Not entitled t
that of the building or trees. In such case, he and cannot r
shall pay reasonable rent, if the owner of the if the remova
land does not choose to appropriate the building
or trees after proper indemnity. The parties shall Not entitled
agree upon the terms of the lease and in case of expenses exc
disagreement, the court shall fix the terms luxurious im
thereof. one at the tim
(the deprecia
LAND OWNER BUILDER/PLANTER/SOWER IS THE OWNER OF
Can remove
Good Faith Good Faith cause injury
Has the option to: them.
1. To appropriate or acquire whatever has been Entitled to receive indemnity for necessary, useful
built, planted or sown after paying indemnity and luxurious 2. Toexpenses
compel (ifthethe builder/
land planter
owner to pay the Must pay th
which includes necessary expenses and useful appropriates thepriceluxurious
of the improvements)
land and the sower and to pay the damages
expenses. has a right of retention
proper rent overplusthe
damages
land without
If he wishes to appropriate the luxurious having to pay for the rent until the land owner
improvement, he must also pay the luxurious pays the indemnity
3. To demand the demolition or removal of the Must remov
expenses. Can remove useful work
improvements
at the expense provided
of theit does
builder/planter/ not cause inj
not cause any injury
sower them.
OR If the landBad owner
Faith does not appropriate the Bad Faith
luxurious improvements, he can remove the same Treat as if both are in good fait
provided there is no injury to the principal thing
In applying Article 448, the land owner, if in good
2. To obligate the builder/planter to pay the To purchase the faith,
land should
at fair market
be givenvalue when
the first option because he is
price of the land and the sower to pay the the value is not considerably more than
the owner of the land especiallythe valueif he is dealing with
proper rent. However, the land owner cannot of the builder or trees
a person in bad faith. His right is older and by the
obligate the builder/ planter to buy if the If the value of the land is considerably
principle of accession, he more than to the ownership
is entitled
value of land is more then the building or the value of the ofbuilding or trees,
the accessory he cannot be
thing.
planting. compelled to buyThetheland
land; in such
owner is incase,
goodhe shall
faith:
pay reasonable rent
1. Ifif hetheisland owner
ignorant of does not
the builder/planter/sowers
choose option 1. act
If he cannot pay2.theEvenpurchase price
if he did of the
know, land,
he expressed his objection
the land owner can require him to remove what
3. If he believed that the builder/planter/sower has
has been built or planted.
a right to construct, plant or sow
If he cannot pay the
rent, the land
Otherwise, heowner
shall becan
in eject
bad faith.
him from theland.The builder/planter/sower is in good faith if he
thought that the land was his.
Bad Faith Good Faith
To acquire whatever has been built, planter or If land owner acquires whatever has been built,
sown by paying the indemnity plus damages planted or sown,
he must be indemnified of the
Art. 453. If there was bad faith, not only on the part
value plus damages
of the person who built, planted or sowed on the land
of another, but also on the part of the owner of such
If land owner does not acquire, he can remove
land, the rights of one and the other shall be the same
whatever has been built or planted whether or not
as though both had acted in good faith.
it will cause any injury and is entitled to damages.
It is understood that there is bad faith on the
part of the landowner whenever the act was done with
If land owner hisdoes not acquire,
knowledge he cannot
and without insist on his part.
opposition

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 91 of 241
 BUILDER/PLANTER/SOWER IS THE OWNER OF
LAND OWNER
Good Faith Good Faith
1. Land owner can acquire the improvement by
paying; or
2. Land owner can obligate builder/planter to
buy the land or collect rent from sower.
However land owner cannot obligate the Good Faith Good Faith
builder/planter to buy if the value of land is Has the option
more then the building or planting. 1. To acquire whatever has To receive indemnity from th
Bad Faith Good Faith been built, planted or sown land owner and has a right
provided
1. Remove materials he paysor the retention over the land until th
plus damages;
indemnity (which
2. Demand payment for materials plus includes land owner pays
damages
Good Faith Bad Faith the value of what has been
Options built, planted or sown plus
1. Appropriate works without indemnity plus value of the materials)
damages; or 2. To oblige the builder/ To buy the land
2. Demolish plus damages; or planter/sower to buy the
3. Compel BPS to buy land regardless of the land unless the value
value of the land and the BP, plus damages thereof is considerably more
than the value of the
Obligations building or trees
1. Land owner must pay for necessary expenses Good Faith Bad Faith
for preservation. Has the option
1. To acquire whatever has Loses what has been bui
2. Land owner must pay BPS expenses under been built, planted or sown planted or sown but he
Article 443 if applicable without paying indemnity entitled to be indemnified f
Bad Faith Bad Faith except necessary expenses, necessary expenses an
(Same as though acted in good faith under (Same as though if acted
he in good faith
should under
acquire luxurious expenses should th
Article 453) Article 453) luxurious improvements land owner acquire luxurio
ornaments
3rd case:
Builder/Planter/Sower builds, plants, or sows Has no right of removal even
on anothers land with materials owned by third it will not cause any injury
person 2. To oblige the builder/ To pay the price of the land
planter to pay the price of
LAND OWNER BUILDER/PLANTER/SOWER the land and the sower to
Good Faith Good Faith pay the proper rent
Has the option 3. To demolish or remove Cannot do anything about it
1. To acquire whatever has To receive indemnity from the what has been built or he must remove
been built, planted or sown land owner and has a right of planted
provided he pays the retention over the land until the
indemnity (which includes land owner pays
the value of what has been
built, planted or sown plus
value of the materials)

2. To oblige the builder/ To buy the land

planter/sower to buy the
land unless the value
thereof is considerably more Bad Faith Good Faith
than the value of the To acquire what has been built, To receive indemnity from lan
building or trees planted or sown by paying the owner plus damages
indemnity plus damages to

Art. 443. He who receives the fruits has the

builder/planter/ sower Cannot insist on purchasing th
obligation to pay the expenses made by a third person
land
in their production, gathering, and preservation.

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 92 of 241
 cannot obligate the builder/
Bad Faith Good Faith planter to buy if the value of
To acquire what has been built, To receive indemnity from land land is more then the
planted or sown by paying the owner plus damages building or planting.
indemnity plus damages to 3. LO not subsidiary liable
builder/planter/ sower Cannot insist on purchasing the for cost of materials
land Good Faith Bad Faith
Options
LAND OWNER BUILDER/PLANTER/SOWER1. Appropriate works without
Good Faith Good Faith indemnity plus damages; or
1. If the owner of the 2. Demolish plus damages;
materials does not remove or
the materials and the 3. Compel builder/planter to
builder/planter/ sower buy land regardless of the
pays, the land owner can value of the land and the
acquire the improvement sower to pay rent, plus
by paying the damages
builder/planter/ sower
2. If the owner of the Obligations
materials does not remove 1. Land owner must pay for
the materials, and the necessary expenses for
builder/planter/ sower preservation.
pays, the land owner can 2. Land owner must pay
obligate the builder/planter builder/planter/sower
to buy the land or collect expenses under Article 443*
rent from sower. However if applicable
the land owner cannot Bad Faith Bad Faith
obligate the builder/planter (Same as though acted in good (Same as though acted in goo
to buy if the value of faith under Article 453) faith under Article 453)
land is more then the
building or planting.
3. The land owner is
subsidiarily liable to the
owner of the materials.
Good Faith Good Faith
1. Land owner can acquire the Keep what was built, planted or
improvement by paying; sown without indemnity to the
or owner of the materials plus
2. Land owner can obligate damages from the owner of the
builder/planter to buy the materials
land or collect rent from
sower. However land owner

*
Art. 443. He who receives the fruits has the
obligation to pay the expenses made by a third person
in their production, gathering, and preservation.

Art. 453. If there was bad faith, not only on the part
of the person who built, planted or sowed on the land
of another, but also on the part of the owner of such
land, the rights of one and the other shall be the same
as though both had acted in good faith.
It is understood that there is bad faith on the
part of the landowner whenever the act was done with
his knowledge and without opposition on his part.

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 93 of 241
Bad Faith Good Faith builder, planter or sower
Subsidiarily liable to the owner 1. Remove improvements plus pays, the land owner can
of the materials for value damages against the land obligate the builder/planter
of materials owner; or to buy the land or collect
2. Demand payment forrent from sower. However
improvement plus damages the land owner cannot
obligate the builder/planter
Bad Faith Bad Faith to buy if the value of land is
1. If the owner of the more then the building or
materials does not remove planting.
the materials and the 3. Land owner is subsidiarily
builder/planter/sower pays, liable to the owner of the
the land owner can acquire materials.
the improvement by paying Bad Faith Good Faith
the builder/planter/sower 1. Right to acquire th
2. If the owner of the materials without payin
materials does not remove indemnity plus damages
the materials, and the 2. Remove improvement pl
builder/planter/sower pays, damages; or
the land owner can obligate 3. Demand payment f
the builder/planter to buy improvement plus damage
the land or collect rent from
the sower. However, the If the option is with the land owner (i.e., to buy the
land owner cannot obligate improvement or sell the land), the land owner
the BP to buy if the value of cannot refuse to exercise that option. The court may
land is more then the compel the land owner to exercise such option.
building or planting. If the land owner opts to buy the improvements from
3. The land owner is the builder/planter/sower, the land owner must pay
subsidiarily liable to the the value of the builder/planter/sower.
owner of the materials. Builder/planter/sower has the right of retention
Good Faith Bad Faith until the land owner pays.
1. If the owner of the materials If the land owner chooses to buy the improvement,
does not remove pays, the the builder/planter/sower can sue to require the
land owner can acquire the land owner to pay him. The obligation has now been
improvement by paying the converted to a monetary obligation.
builder/ planter/sower. There is no transfer of ownership of the
2. If the owner of the improvements until the land owner pays the
materials does not remove builder/planter/sower.
the materials, and the In Ortiz vs. Kayanan the SC said, All the fruits that
the builder/planter/sower may receive from the time
that he is summoned, or when he answers the
complaint, must be delivered or paid by him to the
owner or lawful possessor. Such is the time when his
good faith has ceased. While the
builder/planter/sower retains the property until he
is reimbursed for necessary and useful expenses, all
the fruits the BPS receives from the moment his
good faith ceases must be deferred or paid by him to
the land owner. The builder/planter/sower may,
however, secure the reimbursement of his expenses
by using the fruits to pay it off (deduct the value of
the fruits he receives from the time his good faith
ceases from the reimbursement due him).
Professor Balane doesnt agree with the ruling in
Ortiz vs. Kayanan. It seems inconsistent to say that
the builder/planter/sower retains ownership of the
improvement until he is paid yet the fruits derived

LECTURE NOTES ON CIVIL LAW

Professor Ruben F. Balane Page 94 of 241
 from such improvement should go to the land 2. It is the result of the action of the water
owner. of the river.
If the land owner chooses to sell the land to the 3. Deposits made by human intervention
builder/planter, the builder/planter will have to pay are excluded.
the value of the land based on the prevailing market 4. The land where the accretion takes place
value at the time of payment. is adjacent to the bank of the river.
If the land owner chooses to sell the land and the Accretion operates ipso jure. However,
builder/planter is unable or unwilling to pay, the the additional area is not covered by a
Land owner has 3 options: Torrens title since it is not described in
1. Assume a lessor-lessee relationship; or the title. The riparian owner must
2. Land owner can have the improvements removed register the additional area.
and in the meantime demand rental; or
3. Land owner can have the land and the Art. 458. The owners of
improvements sold at a public auction; the estates adjoining ponds or lagoons
proceeds of which shall be applied preferentially do not acquire the land left dry by
to the value of the land. the natural decrease of the waters,
The land owner cannot compel the sower to buy the or lose that inundated by them in
land. Land owner can either buy the improvement extraordinary floods.
or demand rental.
If the value of the land is considerably greater than Article 458 is does not talk of accession.
the value of the improvement, then the land owner When a body of water dries up, the
can only choose between buying the improvement or owner of the adjoining estate does not
demanding rental from the builder/planter/sower. own the dried up land. There is no
alluvion since soil was not deposited in
b. Natural (Articles 457-465) the adjoining estate. Similarly, if the
land of the adjoining owner should be
i. Alluvion or accretion (Article 457) flooded, such land does not become part
of the public dominion if the flood will
Art. 457. To the owners of subside.
lands adjoining the banks of rivers
belong the accretion which they ii. Avulsion
gradually receive from the effects
of the current of the waters. Art. 459. Whenever the
current of a river, creek or torrent
Article 457 applies only to lands segregates from an estate on its
adjoining banks of rivers. It does not bank a known portion of land and
apply by analogy to lands adjoining all transfers it to another estate, the
bodies of water. However, Article 84 of owner of the land to which the
the Law of Waters applies the same segregated portion belonged
principle to lakes, streams and creeks. retains the ownership of it,
The owners of lands adjoining the banks provided that he removes the same
of rivers (riparian land) shall own the within two years.
accretion which they gradually receive.
Accretion denotes the act or process by Avulsion is the removal of a
which a riparian land gradually and considerable quantity of soil from 1
imperceptively receives addition made estate and its annexation to another by
by the water to which the land is the perceptible action of water.
contiguous. In alluvium, the accumulation of the soil
Alluvion refers to the deposit of soil. is gradual. The soil belongs to the owner
Rationale for this benefit: to of the property where the soil attaches.
compensate the owners for the losses The soil cannot be identified.
which they may suffer by erosion due to In avulsion, the accumulation of soil is
the destructive forces of the water sudden and abrupt. The soil can be
(Ferrer vs. Bautista). identified. The soil belongs to the owner
Requisites of Accretion of the property from where the soil was
1. The accumulation of soil is gradual and taken. However, the owner has to 2
imperceptible. years to get the soil. If he does not get
the soil within 2 years, the owner of the

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Professor Ruben F. Balane Page 95 of 241
 property where the soil currently is shall
own the soil. Requisites
Avulsion is a case of delayed accession 1. The change in the river course must be
(JBL Reyes). sudden
2. The change must be permanent
Art. 460. Trees uprooted 3. The change must natural
and carried away by the current of 4. The river bed must be abandoned by the
the waters belong to the owner of government
the land upon which they may be According to commentators, this
cast, if the owners do not claim requisite has been repealed by Article
them within six months. If such 461. However, the Water Code provides
owners claim them, they shall pay that the government can only return the
the expenses incurred in gathering river to the old bed if the government
them or putting them in a safe sees fit. This is possible especially if
place. there are already existing hydro-electric
plants and irrigation projects.
NOTE: In the case of uprooted trees 5. The river must continue to exist
there is no accession. Has Article 461 been superseded by 58*
of the Water Code?
The owner of the land from which the 58 provides that
trees came from should claim the tree the government has
within 6 months. All that Article 460 the option to let the
requires is claim and not removing. change of river
Although Art. 460 is silent, the owner of course remain as is
the tree should remove the trees within or to bring it back.
a reasonable time. If he does not claim It also provides that
within 6 months, the land owner where the owners of
the tree is shall become the owner. affected lands
(those who lost
iii. Change of river course land) may
undertake to return
Art. 461. River beds which the river to the old
are abandoned through the bed provided they
natural change in the course of the get a permit from
waters ipso facto belong to the the government.
owners whose lands are occupied 58 does not
by the new course in proportion to contain the 2nd
the area lost. However, the owners sentence of Article
of the lands adjoining the old bed 461. Is the 2nd
shall have the right to acquire the sentence repealed?
same by paying the value thereof, According to Professor Balane, no it is
which value shall not exceed the not since they are not inconsistent.
value of the area occupied by the
*
new bed. Article 58. When a river or stream suddenly changes
its course to traverse private lands, the owners of the
Art. 462. Whenever a river, affected lands may not compel the government to
changing its course by natural restore the river to its former be; nor can they restrain
causes, opens a new bed through a the government from taking steps to revert the river or
private estate, this bed shall stream to its former course. The owners of the lands
become of public dominion. thus affected are not entitled to compensation for any
damage sustained thereby. However, the former
Art. 463. Whenever the owners of the new bed shall be the owners of the
abandoned bed in proportion to the area lost by each.
current of a river divides itself into
The owners of the affected lands may
branches, leaving a piece of land
undertake to return the river or stream to its old bed
or part thereof isolated, the owner
at their own expense; Provided, That a permit therefor
of the land retains his ownership.
is secured from the Secretary of Public Works,
He also retains it if a portion of Transportation and Communication and works
land is separated from the estate pertaining thereto are commenced within two years
by the current. from the change in the course of the river or stream.

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Professor Ruben F. Balane Page 96 of 241
 Thus, the adjacent owners of the old bed
can buy the old river bed. a. Adjunction or conjunction
The old river bed according to Article (Articles 466-471)
461 and 58 shall be acquired by the
people who lost their land in proportion Art. 466. Whenever
to their land lost. This is fair but it is two movable things
complicated. First, how do you compute belonging to different
the proportions? Second, what if the old owners are, without bad
river bed is far away? faith, united in such a way
The new river bed is a case of de facto that they form a single
eminent domain. object, the owner of the
There is no accession under Article 463. principal thing acquires the
The river merely divides itself into accessory, indemnifying the
branches. former owner thereof for
its value.
iv. Formation of island
Art. 467. The
Art. 464. Islands which principal thing, as between
may be formed on the seas within two things incorporated, is
the jurisdiction of the Philippines, deemed to be that to which
on lakes, and on navigable or the other has been united
floatable rivers belong to the State. as an ornament, or for its
use or perfection.
Art. 465. Islands which
through successive accumulation Art. 468. If it cannot
of alluvial deposits are formed in be determined by the rule
non-navigable and non-floatable given in the preceding
rivers, belong to the owners of the article which of the two
margins or banks nearest to each things incorporated is the
of them, or to the owners of both principal one, the thing of
margins if the island is in the the greater value shall be so
middle of the river, in which case considered, and as between
it shall be divided longitudinally in two things of equal value,
halves. If a single island thus that of the greater volume.
formed be more distant from one In painting and
margin than from the other, the sculpture, writings, printed
owner of the nearer margin shall matter, engraving and
be the sole owner thereof. lithographs, the board,
metal, stone, canvas, paper
Under Article 464, there is no accession. or parchment shall be
All belong to the state islands which deemed the accessory
are formed on Philippine seas, on lakes thing.
and on navigable rivers. The SC
however has not said what kind of Art. 469. Whenever
property such the islands were the things united can be
patrimonial or of the public dominion. separated without injury,
Under Article 465, if the island is their respective owners
formed in a non-navigable river, there is may demand their
accession. If the island is formed in a separation.
navigable river, then it belongs to the Nevertheless, in case the thing united
state. for the use, embellishment or
perfection of the other, is much more
59 of the Water Code defines what is
precious than the principal thing, the
navigable.
owner of the former may demand its
separation, even though the thing to
2. Movables
which it has been incorporated may
suffer some injury.
Article 59. Rivers, lakes and lagoons may, upon the
recommendation of the Philippine Coast Guard, be
declared navigable either in whole or in part.

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Professor Ruben F. Balane Page 97 of 241
 Art. 470. Whenever the owner of the 3. The owner of the principal object is in
accessory thing has made the bad faith and the owner of the accessory is in
incorporation in bad faith, he shall lose good faith.
the thing incorporated and shall have AO has 2 options:
the obligation to indemnify the owner of a. Demand value of the accessory plus
the principal thing for the damages he damages; or
may have suffered. b. Demand separation even if the principal
If the one who has acted in bad faith is will be destroyed plus damages (Article 470,
the owner of the principal thing, the 2)
owner of the accessory thing shall have 4. Owner of the principal object and the
a right to choose between the former owner of the accessory both in bad faith
paying him its value or that the thing Treat as if both are in good faith (Article
belonging to him be separated, even 453 by analogy).
though for this purpose it be necessary Rules to Determine Which is the
to destroy the principal thing; and in Principal and Which is the Accessory
both cases, furthermore, there shall be a. Primary rule importance or purpose
indemnity for damages. For example, the watch is the principal
If either one of the owners has made the (to tell time) while the bracelet is the accessory
incorporation with the knowledge and (to wear).
without the objection of the other, their b. Secondary rule - value
respective rights shall be determined as c. Tertiary rule volume or mass
though both acted in good faith. d. Fourth rule merits, utility, value
(combination)
Art. 471. Whenever the owner of the NOTE: One normally does not go beyond the
material employed without his consent 2nd test.
has a right to an indemnity, he may Kinds of Adjunction of Conjunction
demand that this consist in the delivery 1. Engraftment
of a thing equal in kind and value, and 2. Attachment
in all other respects, to that employed, a. ferruminatio
or else in the price thereof, according to b. plumbatura
expert appraisal. 3. Weaving
4. Painting
There is adjunction or conjunction when 5. Writing
2 movables are attached to each other such
that separation is impossible without injury. b. Commixtion or Confusion
For example, the paint of B is used on the (Articles 472, 433)
canvass of C.
Basic Rule: If separation is possible Art. 472. If by the
without injury, then should separate. If this is will of their owners two
not possible, then adjunction or conjunction. things of the same or
There are 2 parties here: the owner of different kinds are mixed,
the principal object and the owner of the or if the mixture occurs by
accessory. chance, and in the latter
4 Situations: case the things are not
1. Both owner of the principal object and separable without injury,
the owner of the accessory are in good faith each owner shall acquire a
The owner of the principal object right proportional to the
acquires the thing but with the duty to part belonging to him,
indemnify the owner of the accessory. (Article bearing in mind the value
466). However, the owner of the accessory has of the things mixed or
a right to demand separation even though confused.
there may be damage if the accessory is more
valuable. Art. 473. If by the
2. The owner of the principal object is in will of only one owner, but
good faith and the owner of the accessory is in in good faith, two things of
bad faith. the same or different kinds
The owner of the accessory loses the are mixed or confused, the
thing plus is liable for damages (Article 470) rights of the owners shall
be determined by the

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Professor Ruben F. Balane Page 98 of 241
 provisions of the preceding at his option, appropriate
article. the new thing to himself,
If the one who after first paying indemnity
caused the mixture or for the value of the work, or
confusion acted in bad demand indemnity for the
faith, he shall lose the thing material.
belonging to him thus If in the making of
mixed or confused, besides the thing bad faith
being obliged to pay intervened, the owner of
indemnity for the damages the material shall have the
caused to the owner of the right to appropriate the
other thing with which his work to himself without
own was mixed. paying anything to the
maker, or to demand of the
Commixtion refers to the latter that he indemnify
mixture of solids (i.e. the him for the value of the
mixture of rice of different material and the damages
varieties). Confusion refers he may have suffered.
to the mixture of liquids However, the owner of the
(i.e. mixture of different material cannot
gasoline) appropriate the work in
Rules: case the value of the latter,
1. If caused by the will of for artistic or scientific
the parties or by chance reasons, is considerably
or by the will of 1 party more than that of the
but is in good faith, then material.
there will be a co-
ownership based on Specification is the giving of
proportional value (not a new form to another
volume). persons material through
2. If caused by the will of 1 the application of labor.
party in bad faith, then Here there are 2 parties: the
the party in bad faith material owner and the
loses the entire thing. maker.
Some commentators say 4 Situations
that commixtion or 1. Both material owner and maker are
confusion is not a true case in good faith
of accession since there is Maker acquires the thing with the
no principal or accessory. duty to indemnify the material
Also, there is a co- owner (Article 474, 1).
ownership. In accession, However, if the material is much
everything goes to 1 party. more precious then the material
owner has 2 options:
c. Specification (Article 474) a. To appropriate the thing and pay the
maker; or
Art. 474. One who b. To sell the material to maker
in good faith employs the 2. Maker is in bad faith and the
material of another in material owner is in good faith
whole or in part in order to Material owner has 2 options
make a thing of a different (Article 470):
kind, shall appropriate the a. Appropriate the thing without
thing thus transformed as indemnity to maker plus damages;
his own, indemnifying the or
owner of the material for This option is not available if the
its value. value of the work is considerably
If the material is more than the material.
more precious than the b. Sell the material to maker plus
transformed thing or is of damages
more value, its owner may,

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Professor Ruben F. Balane Page 99 of 241
 3. Maker is in good faith and the distinct from the members distinct from
material owner is in bad faith A stipulation that a co-ownership be created for a A partnership
Maker appropriates without the period of more than 10 years is void than 10 years
duty to pay the material owner plus In co-ownership, a special authority is needed for In partners
damages (Article 470 by analogy). representation among co-owners representatio
4. Maker and the material owner are In a co-ownership there is freedom of disposition In a partner
both in bad faith of a co-owners share rights to 3rd
Treat both in good faith (Article 453 others
by analogy). Death or incapacity of 1 of the co-owners have no The partners
effect on the existence of a co-ownership or incapacity
II. Co-Ownership The distribution of profits is invariable in co- The distribut
Co-ownership is the right of common dominion ownership by virtue of Article 485 in partnershi
which 2 or more persons have in a spiritual
(a.k.a. ideal or aliquot) part of a thing which is Art. 485. The share of the co-owners,
not physically divided. in the benefits as well as in the charges, shall
In co-ownership, there is only 1 ownership, but ii be proportional to their respective interests.
is shared ownership. Any stipulation in a contract to the contrary
Each co-owner owns a fractional or an ideal part shall be void.
of the object but they cannot point to a specific The portions belonging to the co-
part of the object. owners in the co-ownership shall be
Co-ownership is not encouraged since it is very presumed equal, unless the contrary is
unwieldy. It is very easy to have disagreements proved.
between co-owners.
A. Sources of Co-Ownership A co-owners share in the fruits and expenses is
1. By law always dependent on the co-owners interest.
Law may mandate co-ownership (i.e., Any agreement to the contrary is void.
party wall) A makes a will. A gives farm to Jason, Joji and
2. By contract Ron in equal shares. However, the will states
3. By chance that the sharing in fruits and expenses in not
Examples are commixtion or confusion equal. Jason gets 80%, Joji gets 15%, and Ron
4. By occupation 5%. Is this valid? This is a debatable point
In Punzalan vs. Boon Liat, the SC said according to Professor Balane. Some
that the fishermen are co-owners of the commentators say it is valid since Art. 485 refers
whale they caught. to contractual agreements. Some commentators
5. By succession argue that it is not valid. Although Art. 485
Compulsory, testamentary, intestate refers to contractual agreements, it should
B. Characteristics of Co-Ownership extend to other sources of co-ownership since
1. More than 1 owner Art. 485 is an expression of public policy.
2. 1 physical unit or whole divided into ideal or
fractional shares Art. 486. Each co-owner may use the
3. Each fractional share is definite in amount thing owned in common, provided he does so
but not physically segregated from the rest in accordance with the purpose for which it is
4. As to the physical unit, each co-owner must intended and in such a way as not to injure
respect the other co-owners in its common the interest of the co-ownership or prevent
use, enjoyment and preservation (Article the other co-owners from using it according
483) to their rights. The purpose of the co-
5. As to the aliquot share, each co-owner holds ownership may be changed by agreement,
absolute control (Article 493) express or implied.
6. No juridical personality of its own
C. Co-Ownership Distinguished from Co-owners must respect the rights of the other
co-owners.
Partnership In Pardell vs. Bartolome, 2 sisters owned a 2
CO-OWNERSHIP story building. The first floor was by rented out.
Co-ownership may arise from other causes (i.e., Partnerships are created only by
The second agreement
floor was beingoroccupied by 1 sister.
will or law) contract The other sister was in Spain. The SC said that
The purpose of co-ownership is for collective The purpose of partnership is profit
the sister occupying the second floor need not
enjoyment and to maintain the unity and pay rent. The fact that she used the whole
preservation of the thing owned in common second floor is irrelevant. She did not prejudice
In co-ownership, there is no juridical personality In partnership, there is a juridical personality

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Professor Ruben F. Balane Page 100 of 241
 the rights of her sister in Spain precisely because only has the right to require payment. He may
she was in Spain. But with respect to the first not demand the share of the co-owner.
floor which was occupied by the husband of one
of the sisters, the husband should pay his sister- Art. 489. Repairs for preservation
in-law of the rent for such portion. Otherwise, may be made at the will of one of the co-
his sister-in-law would be prejudiced. owners, but he must, if practicable, first
As a co-owner, one can use all of the physical notify his co-owners of the necessity for such
unit. For example, a co-owner uses the entire repairs. Expenses to improve or embellish
car, not just a portion of the car. A co-owner the thing shall be decided upon by a majority
does not have to pay rent for the use of the thing as determined in article 492.
co-owned.
Repairs for preservation may be made at the will
Art. 487. Any one of the co-owners of 1 of the co-owners.
may bring an action in ejectment. As much as possible, notice should be given to
the other co-owners. The lack of notice only
Any one of the co-owners may bring an action in gives rise to the presumption that the repairs
ejectment. were not necessary. However, this can be
A, B, C, D, and E are co-owners of a lot which is proven otherwise.
being squatted. A files an ejectment suit. A Article 489 is a case where 1 co-owner can bind
wins. All the other co-owners benefit. Do the the other. The other instance is Article 487.
other co-owners share in the expense? Yes, one Useful or ornamental expenses need a majority.
can argue that its a necessary expense. Majority is computed not by counting heads but
A, B, C, D, and E are co-owners of a lot which is by majority of the controlling interest in the co-
being squatted. A files an ejectment suit. A ownership.
loses. May the other sue for ejectment? No, it is
barred by prior judgment. Art. 490. Whenever the different
A,B, and C bought a book on credit. They are co- stories of a house belong to different owners,
owners of a book. In an action by the creditor if the titles of ownership do not specify the
against the co-owners, the creditor must sue all. terms under which they should contribute to
Article 487 contemplates a situation when it is the necessary expenses and there exists no
the co-owner who files the suit not when they agreement on the subject, the following rules
are the defendants. shall be observed:
Article 487 is a case where 1 co-owner can bind (1) The main and party walls, the roof
the other. The other instance is Article 489. and the other things used in
common, shall be preserved at the
Art. 488. Each co-owner shall have a expense of all the owners in
right to compel the other co-owners to proportion to the value of the story
contribute to the expenses of preservation of belonging to each;
the thing or right owned in common and to (2) Each owner shall bear the cost of
the taxes. Any one of the latter may exempt maintaining the floor of his story;
himself from this obligation by renouncing the floor of the entrance, front door,
so much of his undivided interest as may be common yard and sanitary works
equivalent to his share of the expenses and common to all, shall be maintained
taxes. No such waiver shall be made if it is at the expense of all the owners pro
prejudicial to the co-ownership. rata;
(3) The stairs from the entrance to the
Expenses for the preservation of the thing first story shall be maintained at the
owned in common as well as taxes must be expense of all the owners pro rata,
shouldered by every co-owner in proportion to with the exception of the owner of
their interest. the ground floor; the stairs from the
A co-owner has 2 options: first to the second story shall be
1. Pay for the necessary expenses or taxes preserved at the expense of all,
2. Can forfeit so much of his share which is except the owner of the ground floor
equivalent to his interest to the co-owner and the owner of the first story; and
who paid for the necessary expenses or taxes so on successively.
The co-owner who made the advance has a right
of reimbursement. The advancing co-owner This hardly exists anymore.
Condominium Law (RA 4726 as amended by
R.A. No. 7899)

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Professor Ruben F. Balane Page 101 of 241
 Most condominiums are corporations. If the separate units and the
condominium is a co-ownership, then the common areas of the
provisions of the Civil Code are relevant. condominium projects.
Important Sections Where title to or to
1. 2 - Definition appurtenant interests in
the common areas is to be
Sec. 2. A Condominium is held by a condominium
an interest in real property corporation, a statement to
consisting of a separate interests this effect shall be included;
in a unit in a residential, industrial e) Statement of the purposes
or commercial building or in an for which the building or
industrial estate and an undivided buildings and each of the
interests in common, directly and units are intended or
indirectly, in the land, or the restricted as to use;
appurtenant interest of their f) A certificate of the
respective units in the common registered owner of the
areas. property, if he is other than
The real right in those executing the master
condominium may be ownership deed, as well as of all
or any interest in real property registered holders of any
recognized by law on property in lien or encumbrances on
the Civil Code and other pertinent the property, that they
laws. consent to the registration
of the deed;
2. 4 Enabling or master deed (contents g) The following plans shall be
and necessary requirements) appended to the deed as
(amended) integral parts thereof:
1. A survey plan of the
Sec. 4. The provisions of land included in the
this Act shall apply to property project, unless a survey
divided or to be divided into plan of the same
condominium only if there shall be property had previously
recorded in the Register of Deeds been filed in said office.
of the province or city in which the 2. A diagrammatic floor
property lies, and duly annotated plan of the building or
in the corresponding certificate of buildings each unit, its
title of the land, if the latter had relative location and
been patented or registered under approximate
either the Land Registration or dimensions.
Cadastral Acts, an enabling or h) Any reasonable restriction
master deed which shall contain, not contrary to law, morals,
among others, the following: or public policy regarding
a) Description of the land on the right of any
which the building or condominium owner to
buildings and alienate or dispose off his
improvements are to be condominium.
located; The enabling or master
b) Description of the building deed may be amended or revoked
or buildings, stating the upon registration of an instrument
number of stories and executed by a simple majority of
basement, the number of the registered owners of the
units and their accessories, property: Provided, That in a
if any; condominium project exclusively
c) Description of the common for either residential or
areas and facilities; commercial use, simple majority
d) A statement of the exact shall be on a per unit of ownership
nature of the interest basis and that in the case of mixed
acquired or to be acquired use, simple majority shall be on a
by the purchased in the floor area of ownership basis:

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Professor Ruben F. Balane Page 102 of 241
 Provided, further, That prior a) The boundary of the unit
notifications to all registered granted are the interior
owners are done: and Provided, surfaces of the perimeter
finally, That any amendment or walls, floors, ceiling,
revocation already decided by a windows and doors thereof:
simple majority of all registered Provided, that in the case of
owners shall be submitted to the an industrial estate
Housing and Land Use Regulatory condominium projects,
Board and the city/municipal wherein whole buildings,
engineer for approval before it can plants or factories may be
be registered. Until registration of considered as unit defined
a revocation, the provisions of this under section 3 (b) hereof,
Act shall continue to apply to such the boundary of a unit shall
property. (As amended by R.A. include the outer surfaces
No. 7899) of the perimeter walls of
said buildings, plants or
3. 5 What transfer of ownership factories. The following are
includes (includes citizenship not part of the unit: bearing
requirements) walls, columns, floors,
roofs, foundations, and
Sec. 5. Any transfer or other common structural
conveyance of a unit or an elements of the buildings;
apartment, office or store or other lobbies, stairways, hall
space therein, shall include the ways and other areas of
transfer or conveyance of the common use, elevator
undivided interest in the common equipment and shafts,
areas or in a proper case, the central heating, central
membership or share holdings in refrigeration and central
the condominium corporation: air conditioning
Provided, however, That where equipment, reservoir,
the common areas in the tanks, pumps and other
condominium project are held by central services and
the owners of separate units as co- facilities, pipes, ducts,
owners hereof, no condominium flues, chutes, conduits
unit therein shall be conveyed or wires and other utility
transferred to persons other than installations, wherever
Filipino citizens or corporation at located, except the outlets
least 60% of the capital stock of thereof when located
which belong to Filipino citizens, within the unit.
except in cases of hereditary b) There shall pass with the
succession. Where the common unit, as an appurtenant
areas in a condominium project thereof, an exclusive
are held by a corporation, no casement for the use of the
transfer or conveyance of a unit air space encompasses by
shall be valid if the concomitant the boundaries of the unit
transfer of the appurtenant as it exists at any particular
membership or stockholding in time and as the unit may
the corporation will cause the lawfully be altered or
alien interest in such corporation reconstructed from time to
to exceed the limits imposed by time. Such easement shall
existing laws. be automatically
terminated in any air space
4. 6 Incidents of condominium grant upon destruction of the
units as to render it
Sec. 6. Unless otherwise untenantable.
expressly provided in the enabling c) Unless otherwise provided,
or master deed or the declaration the common areas are held
of restrictions, the incidents of a in common by the holders
condominium grant are as follows:

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Professor Ruben F. Balane Page 103 of 241
 of units, in equal share one a) That three years after
for each unit. damage or destruction to
d) A non-exclusive easement the project which renders a
for ingress, egress and material part thereof unfit
support through the for its use prior thereto, the
common areas in project had not been rebuilt
appurtenant to each unit or repaired substantially to
and the common areas are its state prior to its damage
subject to such easement. or destruction; or
e) Each condominium owner b) That damage or destruction
shall have the exclusive to the project has rendered
right to paint, repaint, tile, one half or more of the
wax, paper or otherwise units therein untenantable
refinish and decorate the and that condominium
inner surfaces of the walls, owners holding in
ceilings, floors, windows aggregate more than 30
and doors hounding his percent interest in the
own unit: provided, that in common areas are opposed
the case of an industrial to the repair or restoration
estate condominium unit, of the projects; or
such right may be exercised c) That project has been in
over the external surfaces existence in excess of 50
of the said unit. years, that it is obsolete and
f) Each condominium owner uneconomical, and that
shall have the exclusive condominium owners
right to mortgage, pledge or holding in aggregate more
encumber his than 50 percent interest in
condominium and to have the common areas are
the same appraised opposed to repair or
independently of the other restoration or remodeling
condominium owner. or modernizing of the
g) Each condominium owner project; or
has also the absolute right d) That the project or a
to sell or dispose of his material part thereof has
condominium unless the been condemned or
master deed contains a expropriated and that the
requirements that the project is no longer viable,
property be first offered to or that the condominium
the condominium owners owners holding in
within a reasonable period aggregate more than 70
of time before the same is percent interest in the
offered to outside parties; common areas are opposed
to the continuation of the
5. 8 When partition is allowed condominium regime after
expropriation or
Sec. 8. Where several condemnation of a material
persons own condominium in a proportion thereof; or
condominium project, an action e) That the condition for such
may be brought by one or more partition by sale set forth in
such person for partition thereof, the declaration of
by sale of the entire project, as if restrictions duly registered
the owners of all the condominium in accordance with the
in such project were co-owners of terms of this Act, have been
the entire project in the same met.
proportion as their interests in the
common areas: Provided, 6. 9 Declaration of restrictions
however, that a partition shall be
made only upon a showing: Sec. 9. The owner of a
project shall, prior to the

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Professor Ruben F. Balane Page 104 of 241
 conveyance of any condominium against the entire
therein, register a declaration or project of the common
restrictions, relating to such areas;
project, which restrictions shall 6. The manner for
ensure to a bind all condominium delegation of its powers;
owners in the project, such liens, 7. For reconstruction of
unless otherwise provided, may be any portion or portions
enforced by any condominium of any damage to or
owner in the project or by the destruction of the
management body of such project. project;
The Register of Deeds shall enter 8. For entry by its officers
and annotate the declaration of and agents into any unit
restrictions, upon the Certificate when necessary in
of Title covering the land included connection with the
within the proper, if the land is maintenance or
patented or registered under the construction for which
Land Registration or Cadastral such body is
Acts. responsible;
Such declaration of 9. For a power of attorney
restrictions, among the other to the management
things, may also provide: body to sell the entire
a) As to management body project for the benefit of
1. For the power thereof, all of the owners thereof
including power to when partition of the
enforce the provisions project may be
of the declarations of authorized under
restrictions; Section 8 of this Act,
2. For the maintenance of which said power shall
insurance policies be binding upon all of
insuring condominium the condominium
owners against loss by owners regardless or
the, casualty, liability, whether they assume
workmen's the obligations of the
compensation and other restrictions or not.
insurable risks and for b) The manner and procedure
bonding of the members for amending such
of any management restrictions, provided, that
body; the vote of not less than a
3. Provisions for majority in interest of the
maintenance, utility, owners is obtained;
gardening and other c) For independent audit of
services benefiting the the accounts of the
common areas for the management body;
operations of the d) For reasonable
building, and legal, assessments to meet
accounting and other authorized expenditures,
professional and each condominium unit to
technical services; be assessed separately for
4. For purchase of its share of such expenses
materials, supplies and in proportion (unless
the like needed by the otherwise provided) to its
common areas; owner's fractional interest
5. For payment of taxes in any common areas;
and special assessment e) For the subordination of
which would be a lien the liens securing such
upon the entire project assessments to other lien
or common areas, for either generally or
discharge of my specifically described;
encumbrance levied

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Professor Ruben F. Balane Page 105 of 241
 f) For conditions, other than 8. 13 Judicial dissolution of
those provided for in condominium corporation
Sections 8 and 13 of this
Act, upon which partition Sec. 13. Until the enabling
of the project and or the master deed of the project
dissolution of the in which the condominium
condominium corporation corporation owns or holds the
may be made. Such right to common areas is revoked the
partition or dissolution corporation shall not be
may be conditioned upon voluntarily dissolved through an
failure of the condominium action for dissolution under Rule
owners to rebuild within a 104 of the Rules of Court except
certain period or upon upon a showing:
specified percentage of a) The three years after
damage to the building, or damage or destruction to
upon a decision of an the project in which
arbitration, or upon any damage or destruction
other reasonable condition. renders a materials part
thereof unfit for its use
7. 10 Condominium corporation prior thereto, the project
has not been rebuilt or
Sec. 10. Whenever the repaired substantially to its
common areas in a condominium state prior to its damage or
project are held by a condominium destruction; or
corporation, such corporation b) The damage or destruction
shall constitute the management to the project has rendered
body of the project. The corporate one half or more of the
purposes of such a corporation units therein untenantable
shall be limited to the holding of and that more than 30
the common areas; either the percent of the member of
ownership of any other interest in the corporation entitled to
real property recognized by the vote, if a stock corporation,
law, to the management of the are opposed to the repair or
project, and to such other reconstruction of the
purposes as maybe necessary, project; or
incidental or convenient to the c) That the project has been in
accomplishment of said purposes. existence excess of 50
The articles of incorporation or by years, that it is obsolete and
laws of the corporation shall not uneconomical and that
contain any provision contrary to more than 50 percent of the
or inconsistent with the provision members of the
of this Act, the enabling or master corporation if non-stock or
deed, or the declaration of stockholders representing
restrictions of the project, more than 50 percent of the
membership in a condominium capital stock entitled to
corporation regarding of whether vote, if a stock corporation,
it is stock or non-stock are opposed to the repair or
corporation, shall not be restoration or remodeling
transferable separately from the or modernizing of the
condominium unit of which it is an project; or
appurtenance. When a member or d) That project or material
a stockholder ceases to own a unit part thereof has been
in the project in which the condemned or
condominium corporation owns expropriated and that the
or holds the common area, he project is no longer viable
shall automatically cease to be a or that the members
member or stockholder of the holding in aggregate more
condominium corporation. than 70 percent interest in
the corporation if non-

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Professor Ruben F. Balane Page 106 of 241
 stock, or the stockholders therefrom. However, if the withholding of
representing more than 70 the consent by one or more of the co-owners
percent of the capital stock is clearly prejudicial to the common interest,
entitled to vote, if a stock the courts may afford adequate relief.
corporation, are opposed to
the continuation of the In order to make alterations, the consent of all
condominium regime after co-owners is needed.
expropriation or An alteration is an act of strict ownership (i.e.
condemnation of a material any act of encumbrance) or one which involves a
portion thereof; or change in the use of the thing (i.e. bought
e) That the conditions for Tamarax FX to carpool and then decide to rent it
such a dissolution set forth out).
in the declaration of However, if the withholding of the consent by 1
restrictions of the project in or more of the creditors is clearly prejudicial to
which the corporation owns the common interest, the court may intervene
or holds the common areas, and afford adequate relief.
have been met.
Art. 492. For the administration and
9. 14 Voluntary dissolution of better enjoyment of the thing owned in
condominium corporation (amended) common, the resolutions of the majority of
the co-owners shall be binding.
Sec. 14. The condominium There shall be no majority unless the
corporation may also be dissolved resolution is approved by the co-owners who
by the affirmative vote of all the represent the controlling interest in the
stockholders or members thereof object of the co-ownership.
at a general or special meeting Should there be no majority, or
duly called for such purpose: should the resolution of the majority be
Provided, That all the seriously prejudicial to those interested in
requirements of Section 62 of the the property owned in common, the court, at
Corporation Law are complied the instance of an interested party, shall
with. order such measures as it may deem proper,
including the appointment of an
10. 16 Disposition of common areas administrator.
Whenever a part of the thing belongs
Sec. 16. A condominium exclusively to one of the co-owners, and the
corporation shall not, during its remainder is owned in common, the
existence, sell, exchange, lease or preceding provision shall apply only to the
otherwise dispose of the common part owned in common.
areas owned or held by it in the
condominium project unless Acts of administration need a majority. Majority
authorized by the affirmative vote is computed not by counting heads but by
of a simple majority of the majority of the controlling interest in the co-
registered owners: Provided, That ownership.
prior notification to all registered An example of an act of administration is
owners are done; and Provided replacing the tires of a car owned in common
further, That the condominium with another brand of tires.
corporation may expand or
integrate the project with another Art. 493. Each co-owner shall have
upon the affirmative vote of a the full ownership of his part and of the
simple majority of the registered fruits and benefits pertaining thereto, and he
owners, subject only to the final may therefore alienate, assign or mortgage it,
approval of the Housing Land Use and even substitute another person in its
Regulatory Board. (As amended enjoyment, except when personal rights are
by R. A. No. 7899) involved. But the effect of the alienation or
the mortgage, with respect to the co-owners,
Art. 491. None of the co-owners shall, shall be limited to the portion which may be
without the consent of the others, make allotted to him in the division upon the
alterations in the thing owned in common, termination of the co-ownership.
even though benefits for all would result

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Professor Ruben F. Balane Page 107 of 241
 Article 493 is the rule regarding fractional Partition converts into certain and
interest. definite parts the respective share of the
The partner provision of Article 493 is Article undivided shares of the co-owners.
486. General Rule: Partition is
Article 493 provides that each co-owner shall demandable by any of the co-owners as
have the full ownership of his part and of the a matter of right at any time. If the
fruits and benefits pertaining thereto, and he other co-owners do not consent, then go
may therefore alienate, assign or mortgage it, to court.
and even substitute another person in its Exceptions:
enjoyment, except when personal rights are a. When there is an agreement to keep
involved. But the effect of the alienation or the the thing undivided
mortgage, with respect to the co-owners, shall be The maximum period for such
limited to the portion which may be allotted to an agreement is 10 years.
him in the division upon the termination of the The agreement can be extended.
co-ownership. Such an extension must not go
Article 486 provides that each co-owner may use beyond 10 years. There is no
the thing owned in common, provided he does limit as to the number of
so in accordance with the purpose for which it is extensions.
intended and in such a way as not to injure the What if the co-owners agree to
interest of the co-ownership or prevent the other extend for more than 10 years, is
co-owners from using it according to their the agreement totally void or it
rights. is good for only 10 years? The
A co-owner may lease his fractional or ideal less radical view would say that
share. it is valid for only 10 years.
A co-owner may not dispose of the entire Partition may either be by
property owned in common. If he does so, the agreement of the parties or by
transaction is valid in so far as his ideal share is judicial proceedings (Article
concern. 496).
b. When prohibited by the donor or
Art. 494. No co-owner shall be testator
obliged to remain in the co-ownership. Each The prohibition by the donor or
co-owner may demand at any time the testator cannot exceed 20 years.
partition of the thing owned in common, What if donor states that the
insofar as his share is concerned. prohibition is for 30 years, is the
Nevertheless, an agreement to keep prohibition totally void or it is
the thing undivided for a certain period of good for only 20 years? The less
time, not exceeding ten years, shall be valid. radical view would say that it is
This term may be extended by a new valid for only 20 years.
agreement. Even though the testator or
A donor or testator may prohibit donor prohibits partition, the
partition for a period which shall not exceed co-ownership shall terminate
twenty years. when:
Neither shall there be any partition i. Any of the causes for which
when it is prohibited by law. partnership is dissolved
No prescription shall run in favor of a takes place; or
co-owner or co-heir against his co-owners or ii. The
co-heirs so long as he expressly or impliedly court finds compelling
recognizes the co-ownership. reasons that division should
be ordered upon petition of
Ways of Terminating a Co-Ownership one of the co-heirs
1. Partition c. When prohibited by law

Exception to the exception:

Art. 486. Each co-owner may use the thing When compelling reasons it
owned in common, provided he does so in accordance
with the purpose for which it is intended and in such a

way as not to injure the interest of the co-ownership or Art. 496. Partition may be made by agreement
prevent the other co-owners from using it according to between the parties or by judicial proceedings.
their rights. The purpose of the co-ownership may be Partition shall be governed by the Rules of Court
changed by agreement, express or implied. insofar as they are consistent with this Code.

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Professor Ruben F. Balane Page 108 of 241
 must be partitioned (i.e., Article in the contract to preserve the co-ownership
159, Family Code) until all the lots shall have been sold, is a mere
d. When partition renders the thing incident to the main object of dissolving the co-
unserviceable ownership. By virtue of the document, the
Article 498 governs in this parties thereto practically and substantially
case. entered into a contract of partnership as the best
Under Article 498, when the and most expedient means of eventually
thing is essentially indivisible dissolving the co-ownership, and the life of said
and the co-owners cannot agree partnership to end when the object of its
that it be allotted to one of them creation shall have been attained.
who shall indemnify the others,
it shall be sold and the its III. Possession
proceeds be distributed.
What is allowed only is a 2 Kinds of Possession
constructive and not a physical A. Possession in the concept of an owner
partition (i.e. in a partition of a (en concepto de dueno)
house). Possession in the concept of an owner
e. When the legal nature of the thing DOES NOT refer to the possessors inner
does not allow partition (i.e. party belief or disposition regarding the
wall) property in his possession.
2. Consolidation Possession in the concept of an owner
3. Destruction or loss refers to his overt acts which tend to
4. Prescription induce the belief on the part of others
General Rule: Prescription will that he is the owner.
not run if the object is in possession Possession in the concept of an owner is
of anyone of the co-owners since ius possidendi.
such possession is not adverse. Possession in the concept of an owner by
Exception: Co-owner may its nature is provisional. It usually ends
repudiate the co-ownership and the up as ownership.
prescriptive period will start to run. Consequences of Possession in the
Anything that terminates a co-ownership is Concept of an Owner
similar to a partition. 1. Possession is converted into
In Tuason vs. Tuason, the co-owners of a huge ownership after the required lapse
parcel of land agreed to improve the property by of time (Article 540)
filling it and constructing roads thereon and
then sub-dividing it into small lots for sale. Art. 540. Only the
Subsequently, one of the co-owners asked the possession acquired and
court for partition alleging that Article 494 was enjoyed in the concept of
violated. The SC said that the contract far from owner can serve as a title for
violating the legal provision that forbids a co- acquiring dominion.
owner from being obliged to remain a party to
the community precisely has for its purpose and 2. Presumption of just title (Article
object the dissolution of the co-ownership and of 541)
the community by selling the parcel held in
common and dividing the proceeds of the sale Art. 541. A possessor in
among the co-owners. The obligation imposed the concept of owner has in his
favor the legal presumption

Art. 159. The family home shall continue despite the that he possesses with a just
death of one or both spouses or of the unmarried head title and he cannot be obliged
of the family for a period of ten years or for as long as to show or prove it.
there is a minor beneficiary, and the heirs cannot
partition the same unless the court finds compelling Relevance of the Inner Disposition of
reasons therefor. This rule shall apply regardless of the Possessor in the Concept of an
whoever owns the property or constituted the family Owner (Good Faith, Bad Faith)
home. 1. Good Faith

Art. 498. Whenever the thing is essentially a. Requisites of Good Faith

indivisible and the co-owners cannot agree that it be i. Ostensible title or mode of
allotted to one of them who shall indemnify the others, acquisition
it shall be sold and its proceeds distributed.

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Professor Ruben F. Balane Page 109 of 241
 If its not an ostensible time of the
title but a real title, then possession.
its ownership. The charges
ii. Vice or defect in the title shall be divided on
If there was no vice or the same basis by
defect in the title, then the two possessors.
its ownership. The owner of
Examples of vice or the thing may,
defect in title should he so desire,
1. Grantor was not the give the possessor in
owner good faith the right
2. Requirements for to finish the
transmission were cultivation and
not complied with gathering of the
3. Mistake in the growing fruits, as an
identity of the indemnity for his
person part of the expenses
4. Property was not of cultivation and
really res nullius the net proceeds; the
iii. Possessor is ignorant of the possessor in good
vice or defect and must have faith who for any
an honest belief that the reason whatever
thing belongs to him should refuse to
Otherwise, its bad faith. accept this
b. Effects of Good Faith concession, shall
i. As to the fruits lose the right to be
1. Fruits already received indemnified in any
(Article 544, 1) other manner.

Art. 544, 1. Entitled to pro-rate

A possessor the fruits already
in good faith is growing when his
entitled to the fruits possession is legally
received before the interrupted
possession is legally For example,
interrupted. possessor planted
crops. It takes the
Entitled to all the crops 4 months to
fruits until grow. On the
possession is legally beginning of the 4th
interrupted (i.e. month, summons is
before summons) served. At the end
2. Fruits still pending of the 4th month, the
(Article 545) crops are harvested.
Under Article 545,
Art. 545. If at the possessor is
the time the good entitled to of the
faith ceases, there crops since the
should be any possessor was in
natural or industrial possession for 3
fruits, the possessor months. However,
shall have a right to he also pays of
a part of the the expenses.
expenses of ii. As to necessary expenses
cultivation, and to a (Article 546, 1)
part of the net
harvest, both in Art. 546, 1.
proportion to the Necessary expenses
shall be refunded to

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Professor Ruben F. Balane Page 110 of 241
 every possessor; but 1. Refund the amount
only the possessor in of expenses; or
good faith may retain 2. Pay the increase in
the thing until he has value which the
been reimbursed thing may have
therefor. acquired
If the useful
The possessor in good improvements can be
faith is entitled to a removed without
refund of necessary damaging the principal
expenses. thing, the possessor in
The possessor in good good faith may remove
faith may retain the them unless the other
thing until he is party wants to keep the
reimbursed for useful improvements.
necessary expenses. In which case, the other
iii. As to useful expenses party has to exercise the
(Articles 546, 2, 547) two previous options.
iv. As to ornamental expenses
Art. 546, 2. (Article 548)
Useful expenses shall be
refunded only to the Art. 548.
possessor in good faith Expenses for pure
with the same right of luxury or mere pleasure
retention, the person shall not be refunded to
who has defeated him in the possessor in good
the possession having faith; but he may
the option of refunding remove the ornaments
the amount of the with which he has
expenses or of paying embellished the
the increase in value principal thing if it
which the thing may suffers no injury
have acquired by reason thereby, and if his
thereof. successor in the
possession does not
Art. 547. If the prefer to refund the
useful improvements amount expended.
can be removed without
damage to the principal The possessor in good
thing, the possessor in faith is not entitled to a
good faith may remove refund for ornamental
them, unless the person expenses.
who recovers the But he may remove the
possession exercises the ornamental
option under paragraph improvements if they do
2 of the preceding not cause damage to the
article. principal thing.

The possessor in good v. As to prescription (Articles

faith is entitled to a 1132, 1134)
refund of useful
expenses. Art. 1132. The
The possessor in good ownership of movables
faith may retain the prescribes through
thing until he is uninterrupted
reimbursed for useful possession for four
expenses. years in good faith.
The other party has the The ownership of
option to personal property also

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Professor Ruben F. Balane Page 111 of 241
 prescribes through 2. Bad Faith
uninterrupted Effects of Bad Faith
possession for eight i. As to the fruits (Article 549)
years, without need of
any other condition. Art. 549. The
With regard to possessor in bad faith
the right of the owner to shall reimburse the
recover personal fruits received and
property lost or of those which the
which he has been legitimate possessor
illegally deprived, as could have received,
well as with respect to and shall have a right
movables acquired in a only to the expenses
public sale, fair, or mentioned in paragraph
market, or from a 1 of article 546 and in
merchant's store the article 443. The
provisions of articles expenses incurred in
559 and 1505 of this improvements for pure
Code shall be observed. luxury or mere pleasure
shall not be refunded to
Art. 1134. the possessor in bad
Ownership and other faith, but he may
real rights over remove the objects for
immovable property are which such expenses
acquired by ordinary have been incurred,
prescription through provided that the thing
possession of ten years. suffers no injury
thereby, and that the
Prescriptive Period: lawful possessor does
1. Movables 4 years not prefer to retain
2. Immovables 10 them by paying the
years value they may have at
vi. As to liability for the time he enters into
deterioration or loss possession.
(Article 552, 1)
The possessor in bad
Art. 552. A faith shall reimburse the
possessor in good faith fruits receive and those
shall not be liable for which the legitimate
the deterioration or loss possessor could have
of the thing possessed, received
except in cases in which The possessor in bad
it is proved that he has faith has a right of
acted with fraudulent reimbursement for
intent or negligence, necessary expenses for
after the judicial the production,
summons. gathering and
preservation of the
The possessor in good fruits.
faith is not liable since ii. As to the necessary
he thought that he was expenses
the owner. The possessor in good
Once the good faith faith is entitled to a
ceases (i.e. summons refund of necessary
served), then the expenses.
possessor is liable if The possessor in good
there was fraudulent faith has no right to
intent or negligence. retain the thing until he

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Professor Ruben F. Balane Page 112 of 241
 is reimbursed for 559 and 1505 of this
necessary expenses. Code shall be observed.
iii. As to useful expenses
The possessor in bad Art. 1137.
faith is not entitled to a Ownership and other
refund of useful real rights over
expenses. immovables also
iv. As to ornamental expenses prescribe through
The possessor in bad uninterrupted adverse
faith is not entitled to a possession thereof for
refund of ornamental thirty years, without
expenses need of title or of good
The possessor in bad faith.
faith is entitled to
remove the ornamental Prescriptive Period
improves only if: 1. Movables 8 years
i. Removal can be 2. Immovables 30
accomplished years
without damaging vi. As to liability for
the principal thing deterioration or loss
and (Article 552, 2)
ii. The lawful
possessor does not Article 552, 2.
prefer to retain the A possessor in bad faith
ornamental shall be liable for
improvements by deterioration or loss in
paying the value every case, even if
thereof at the time caused by a fortuitous
he enters into event.
possession
v. As to prescription (Articles The possessor in bad
1132, 1137) faith becomes an
insurer of the property.
Art. 1132. The He is liable even if the
ownership of movables thing is destroyed, loss
prescribes through or deteriorates due to a
uninterrupted fortuitous event
possession for four Presumptions Applicable
years in good faith. 1. Just Title (Article 541)
The ownership of
personal property also Art. 541. A possessor in
prescribes through the concept of owner has in his
uninterrupted favor the legal presumption
possession for eight that he possesses with a just
years, without need of title and he cannot be obliged
any other condition. to show or prove it.
With regard to
the right of the owner to A possessor in the concept of
recover personal owner has in his favor the legal
property lost or of presumption that he possess
which he has been just title and he cannot be
illegally deprived, as obliged to show or prove it.
well as with respect to
movables acquired in a 2. Good Faith (Articles 527, 559)
public sale, fair, or
market, or from a Art. 527. Good faith is
merchant's store the always presumed, and upon
provisions of articles him who alleges bad faith on

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Professor Ruben F. Balane Page 113 of 241
 the part of a possessor rests the consent of the
the burden of proof. owner, the buyer
acquires no better title
Art. 559. The to the goods than the
possession of movable seller had, unless the
property acquired in good faith owner of the goods is by
is equivalent to a title. his conduct precluded
Nevertheless, one who has lost from denying the
any movable or has been seller's authority to sell.
unlawfully deprived thereof
may recover it from the person c. If the disposition is made
in possession of the same. under any factors act
If the possessor of a (Article 1505, 2)
movable lost or which the
owner has been unlawfully Art. 1505, 2.
deprived, has acquired it in Nothing in this Title,
good faith at a public sale, the however, shall affect:
owner cannot obtain its return (1) The provisions
without reimbursing the price of any factors'
paid therefor. act, recording
laws, or any
Good faith is always presumed, other provision
and upon him who alleges bad of law enabling
faith on the part of a possessor the apparent
rests the burden of proof. owner of goods
The possession of movables to dispose of
acquired in good faith is them as if he
equivalent to title. were the true
Equivalent to title means owner thereof;
presumptive title sufficient
to serve as a basis for This is no longer
prescription. applicable under the
General Rule: A person who present law since we
lost or has been unlawfully now have the Law on
deprived of the movable, may Agency.
recover it from the person who d. Court order
has possession of the movable. e. If purchased ay a
Unlawful deprivation merchants store (Article
extends to all instances 1505(3))
where there is no valid
transmission (i.e. theft, (3) Purchases
robbery, etc.) made in a
Exceptions: merchant's
a. If the possessor obtained store, or in
the movable in good faith at fairs, or
a public sale, the owner markets, in
cannot get it back unless he accordance
reimburses the possessor. with the Code
b. If the owner is estopped of Commerce
(Article 1505,1) and special
laws.
Art. 1505.
Subject to the An example of a
provisions of this Title, merchants store would
where goods are sold by be SM or Rustans.
a person who is not the Without this exception,
owner thereof, and who commercial
does not sell them transactions would be
under authority or with destabilized.

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Professor Ruben F. Balane Page 114 of 241
 Article 1505, 3 states in accident, mistake,
accordance with the duress, or conversion, if
Code of Commerce and the person to whom the
special laws. Articles 85 document was
and 86 was repealed. Is negotiated or a person
Article 1505, 3 still to whom the document
applicable? Professor was subsequently
Balane doesnt know. negotiated paid value
f. If title is lost by prescription therefor in good faith
(Article 1132) without notice of the
breach of duty, or loss,
Art. 1132. The theft, fraud, accident,
ownership of movables mistake, duress or
prescribes through conversion.
uninterrupted
possession for four 3. Continuity of Good Faith
years in good faith. (Articles 528, 529)
The ownership of
personal property also Art. 528. Possession
prescribes through acquired in good faith does not
uninterrupted lose this character except in
possession for eight the case and from the moment
years, without need of facts exist which show that the
any other condition. possessor is not unaware that
With regard to he possesses the thing
the right of the owner to improperly or wrongfully.
recover personal
property lost or of Art. 529. It is presumed
which he has been that possession continues to be
illegally deprived, as enjoyed in the same character
well as with respect to in which it was acquired, until
movables acquired in a the contrary is proved.
public sale, fair, or
market, or from a Possession acquired in good
merchant's store the faith does not lose this character
provisions of articles except in the case and from the
559 and 1505 of this moment facts exist which show
Code shall be observed. that the possessor is not
unaware that he possesses the
g. If the possessor is the thing improperly or wrongfully.
holder in due course of a It is presumed that possession
negotiable instrument of continues to be enjoyed on the
title (Article 1518) same character in which it was
acquired, until the contrary is
Art. 1518. The proved.
validity of the 4. Non-Interruption (Articles 554,
negotiation of a 561)
negotiable document of
title is not impaired by Art. 554. A present
the fact that the possessor who shows his
negotiation was a possession at some previous
breach of duty on the time, is presumed to have held
part of the person possession also during the
making the negotiation, intermediate period, in the
or by the fact that the absence of proof to the
owner of the document contrary.
was deprived of the
possession of the same Art. 561. One who
by loss, theft, fraud, recovers, according to law,

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Professor Ruben F. Balane Page 115 of 241
 possession unjustly lost, shall The possession of real property
be deemed for all purposes presumes that of the movables
which may redound to his therein, so long as it is not
benefit, to have enjoyed it shown or proved that they
without interruption. should be excluded.

A present possessor who shows B. Possession in the concept of a

his possession at some previous holder (en concepto de tenedor)
time, is presumed to have held The possessor in the concept of a
possession also during the holder carries with it no assertion of
intermediate period, in the ownership. There are no overt acts
absence of proof to the contrary. which would induce a belief on the
One who recovers, according to part of others that he is the owner.
law, possession unjustly lost, The possessor in the concept of a
shall be deemed for all purposes holder acknowledges a superior
which may redound to his right in another person which the
benefit, to have enjoyed it possessor admits is ownership.
without interruption. Possession in the concept of a
holder is ius possessionis. This is
5. Extension to the Movables right to possess is an independent
Within or Inside (Articles 542, right (i.e. lessee, trustee, agent,
426) antichretic creditor, pledgee, co-
owner with respect to the entire
Art. 542. The possession of thing, etc.)
real property presumes that of Possession in the concept of a
the movables therein, so long holder will never become
as it is not shown or proved ownership.
that they should be excluded. Presumptions Applicable
1. Non-Interruption (Articles
Art. 426. Whenever by 554, 561)
provision of the law, or an
individual declaration, the Art. 554. A present
expression "immovable things possessor who shows his
or property," or "movable possession at some
things or property," is used, it previous time, is presumed
shall be deemed to include, to have held possession
respectively, the things also during the
enumerated in Chapter 1 and intermediate period, in the
Chapter 2. absence of proof to the
Whenever the word contrary.
"muebles," or "furniture," is
used alone, it shall not be Art. 561. One who
deemed to include money, recovers, according to law,
credits, commercial securities, possession unjustly lost,
stocks and bonds, jewelry, shall be deemed for all
scientific or artistic collections, purposes which may
books, medals, arms, clothing, redound to his benefit, to
horses or carriages and their have enjoyed it without
accessories, grains, liquids and interruption.
merchandise, or other things
which do not have as their A present possessor who
principal object the furnishing shows his possession at
or ornamenting of a building, some previous time, is
except where from the context presumed to have held
of the law, or the individual possession also during the
declaration, the contrary intermediate period, in the
clearly appears. absence of proof to the
contrary.

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Professor Ruben F. Balane Page 116 of 241
 One who recovers, The possession of real
according to law, possession property presumes that of
unjustly lost, shall be the movables therein, so
deemed for all purposes long as it is not shown or
which may redound to his proved that they should be
benefit, to have enjoyed it excluded.
without interruption. In both possession in the concept of an owner
2. Extension to Movables and possession in the concept of a holder, both
Within or Inside (Articles are protected by Article 539.
552, 426) Acquisition and Loss of Possession
A. Acquisition
Art. 552. A How is it Acquired: Possession is
possessor in good faith acquired by the material occupation of a
shall not be liable for the thing or the exercise of a right, or by the
deterioration or loss of the fact that it is subject to the action of our
thing possessed, except in will, or by the proper acts and legal
cases in which it is proved formalities established for acquiring
that he has acted with such right (Article 531)
fraudulent intent or
negligence, after the Art. 531. Possession is
judicial summons. acquired by the material
A possessor in bad occupation of a thing or the
faith shall be liable for exercise of a right, or by the fact
deterioration or loss in that it is subject to the action of
every case, even if caused our will, or by the proper acts and
by a fortuitous event. legal formalities established for
acquiring such right.
Art. 426. Whenever
by provision of the law, or Acquired by Whom: Possession may be
an individual declaration, acquired by the same person who is to
the expression "immovable enjoy it, by his legal representative, by
things or property," or his agent, or by any person without any
"movable things or power whatever but in the last case, the
property," is used, it shall possession shall not be considered as
be deemed to include, acquired until the person in whose name
respectively, the things the act of possession was executed has
enumerated in Chapter 1 ratified the same, without prejudice to
and Chapter 2. the juridical consequences of
Whenever the word negotiorum gestio in a proper case (Art.
"muebles," or "furniture," 532).
is used alone, it shall not be
deemed to include money, Art. 532. Possession
credits, commercial may be acquired by the same
securities, stocks and person who is to enjoy it, by his
bonds, jewelry, scientific or legal representative, by his agent,
artistic collections, books, or by any person without any
medals, arms, clothing,
horses or carriages and
their accessories, grains, Art. 539. Every possessor has a right to be
liquids and merchandise, respected in his possession; and should he be
or other things which do disturbed therein he shall be protected in or restored
not have as their principal to said possession by the means established by the
object the furnishing or laws and the Rules of Court.
ornamenting of a building, A possessor deprived of his possession through
forcible entry may within ten days from the filing of the
except where from the
complaint present a motion to secure from the
context of the law, or the
competent court, in the action for forcible entry, a writ
individual declaration, the
of preliminary mandatory injunction to restore him in
contrary clearly appears.
his possession. The court shall decide the motion
within thirty (30) days from the filing thereof.

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Professor Ruben F. Balane Page 117 of 241
 power whatever: but in the last understood that
case, the possession shall not be the thing is lost
considered as acquired until the when it perishes,
person in whose name the act of or goes out of
possession was executed has commerce, or
ratified the same, without disappears in such
prejudice to the juridical a way that its
consequences of negotiorum existence is
gestio in a proper case. unknown or it
cannot be
B. Loss recovered;
Possession may be lost
1. By abandonment (Article 555 (1)) 4. By possession of another
Abandonment may either be: subject to the provisions of Art.
a. Permanent 537, if the new possession has
There is no need for the lasted longer than 1 year. But
prescriptive period to the real right of possession is
run. not lost till after the lapse of 10
b. Temporary years (Article 555 (4))
Prescription will run. The complaint for forcible entry
See Article 1125 must be filed within 1 year from
the forcible entry.
Art. 1125. Any express Accion publiciana must be filed
or tacit recognition which the after the lapse of 1 year from the
possessor may make of the forcible entry but before the
owner's right also interrupts lapse of 10 years.
possession. In this case, possession is not
really lost until the end of the
2. By assignment made to 10th year.
another either by onerous or 5. By accion reinvindicatoria
gratuitous title (Article 555 (2))
Disposition Art. 1120. Possession is
3. By destruction or total loss of interrupted for the purposes of
the thing, or it goes out of prescription, naturally or
commerce (Article 555 (3)) civilly.
See Article 1189 (1), (2)
Art. 1121. Possession is
Art. 1189. When the naturally interrupted when
conditions have been through any cause it should
imposed with the intention cease for more than one year.
of suspending the efficacy The old possession is
of an obligation to give, the not revived if a new possession
following rules shall be should be exercised by the
observed in case of the same adverse claimant.
improvement, loss or
deterioration of the thing Art. 1122. If the natural
during the pendency of the interruption is for only one
condition: year or less, the time elapsed
(1) If the thing is lost shall be counted in favor of the
without the fault of prescription.
the debtor, the
obligation shall be Art. 1123. Civil
extinguished; interruption is produced by
(2) If the thing is lost judicial summons to the
through the fault possessor.
of the debtor, he
shall be obliged to Art. 1124. Judicial
pay damages; it is summons shall be deemed not

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Professor Ruben F. Balane Page 118 of 241
 to have been issued and shall deterioration they may have
not give rise to interruption: suffered by reason of his fraud
(1) If it should be void for or negligence.
lack of legal
solemnities; Usufruct includes things which
(2) If the plaintiff should gradually deteriorate through
desist from the wear and tear
complaint or should Usufructuary shall have the
allow the proceedings right to make use.
to lapse; The usufructuary shall not be
(3) If the possessor obliged to return the property in
should be absolved its original condition.
from the complaint. The usufructuary shall
In all these cases, the indemnify the property owner
period of the interruption shall for the deterioration in case he
be counted for the is guilty of fraud or negligence.
prescription. b. Article 574
6. By eminent domain Art. 574. Whenever the
usufruct includes things which
IV. Usufruct cannot be used without being
Usufruct is a real right temporary in nature which consumed, the usufructuary
authorizes the holder to enjoy all the benefits which shall have the right to make
result from the normal enjoyment and exploitation use of them under the
of anothers property with the obligation to return at obligation of paying their
the designated time either the same thing or in appraised value at the
special cases its equivalent. termination of the usufruct, if
A. 3 Elements in a Usufruct they were appraised when
1. Essential delivered. In case they were
The essential element of a usufruct is not appraised, he shall have
that it is a real but temporary right to the right to return at the same
enjoy someone elses property. quantity and quality, or pay
2. Natural their current price at the time
The natural element of a usufruct is the the usufruct ceases.
obligation to preserve the form and
substance the property of another. Usufruct includes things which
In extraordinary cases known as cannot be used without being
irregular or imperfect or abnormal consumed
usufruct, this natural element is not This is a usufruct in name only.
present. The usufructuary does not have It is really a mutuum (loan).
to return the same property. Usufructuary shall have the
Kinds of Imperfect Usufruct right to make use.
a. Article 573 If the property was appraised,
the usufructuary shall pay its
Art. 573. Whenever the appraised value.
usufruct includes things which, If the property was not
without being consumed, appraised, the usufructuary may
gradually deteriorate through either
wear and tear, the i. Return the same quantity
usufructuary shall have the and quality; or
right to make use thereof in ii. Pay their current price at
accordance with the purpose the time the usufruct ceases
for which they are intended, c. Article 591, 4
and shall not be obliged to
return them at the termination Article 591, 4. Should
of the usufruct except in their the usufruct be on sterile
condition at that time; but he animals, it shall be considered,
shall be obliged to indemnify with respect to its effects, as
the owner for any

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Professor Ruben F. Balane Page 119 of 241
 though constituted on fungible Art. 226, 2. The right of
things. the parents over the fruits and
income of the child's property
Should the usufruct be on sterile shall be limited primarily to the
animals, it shall be considered child's support and secondarily to
as though it was constituted on the collective daily needs of the
fungible things. family.

3. Accidental 2. According to Extent (Article 564)

The accidental elements are those
which are the subject of stipulation Art. 564. Usufruct may be
(i.e. how long will the usufruct last). constituted on the whole or a part of
B. Usufruct Distinguished from Lease the fruits of the thing, in favor of one
more persons, simultaneously or
BASIS USUFRUCT successively, and in every case from
Extent Covers all fruits and uses as a rule or to a certain day, purely or
conditionally. It may also be
Nature of the right Is always a real right constituted on a right, provided it is
not strictly personal or
intransmissible.

a. Total all of the fruits

Creator of the right Can be created only by the owner or b. Partial part of the fruits
by a duly authorized agent, acting in 3. According to Persons Enjoying the
behalf of the owner Right of Usufruct (Article 564)
a. Simple only one usufructuary enjoys
Origin May be created by law, contract, last b. Multiple several usufructuaries enjoy
will or prescription i. Simultaneous
ii. Successive
4. According to the Terms of the
Usufruct (Article 564)
a. Pure no terms and conditions
b. Conditional
Cause The owner is more or less passive, c. With a Term or Period
and allows the usufructuary to enjoy 5. According to the Object of the Usufruct
the thing given in usufruct deja (Article 564)
gozar a. Things
b. Rights
Repairs Usufructuary has the duty to make
ordinary repairs A usufruct may be constituted on a
Taxes Usufructuary pays for annual right provided that it is not strictly
charges & taxes on fruits personal or intransmissible.
D. Rights of the Usufructuary
Other things Usufructuary may lease the property
1. Right to the fruits (Articles 566 - 570)
itself to another
Art. 566. The usufructuary
C. Kinds of Usufruct
shall be entitled to all the natural,
1. According to Source (Article 563)
industrial and civil fruits of the
property in usufruct. With respect to
Art. 563. Usufruct is
hidden treasure which may be found
constituted by law, by the will of
on the land or tenement, he shall be
private persons expressed in acts
considered a stranger.
inter vivos or in a last will and
testament, and by prescription.
Art. 567. Natural or industrial
fruits growing at the time the usufruct
a. Voluntary or Conventional (i.e.
begins, belong to the usufructuary.
contracts, donations, wills)
Those growing at the time the
b. Legal created by law (i.e. Article 226,
usufruct terminates, belong to the
2, Family Code)
owner.

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Professor Ruben F. Balane Page 120 of 241
 In the preceding cases, the The usufructuary at the beginning of the
usufructuary, at the beginning of the usufruct, has no obligation to refund to
usufruct, has no obligation to refund the owner any expenses incurred.
to the owner any expenses incurred; The owner shall reimburse at the
but the owner shall be obliged to termination of the usufruct from the
reimburse at the termination of the proceeds of the growing fruits, the
usufruct, from the proceeds of the ordinary expenses of cultivation
growing fruits, the ordinary expenses incurred by the usufructuary.
of cultivation, for seed, and other Rents derived from the lease of
similar expenses incurred by the properties in usufruct are civil fruits.
usufructuary. The usufructuary is entitled to receive
The provisions of this article such rents only up to the time of the
shall not prejudice the rights of third expiration of the usufruct, if the lease
persons, acquired either at the still subsists after the termination of the
beginning or at the termination of the usufruct. For example, if the lease is for
usufruct. 5 years and the usufruct terminates after
the 2nd year, the usufructuary shall be
Art. 568. If the usufructuary entitled to 2 years rent; the rent for the
has leased the lands or tenements remaining period will belong to the
given in usufruct, and the usufruct owner.
should expire before the termination
of the lease, he or his heirs and 2. Right to enjoy any increase in the
successors shall receive only the accession or any servitude (Article 571)
proportionate share of the rent that
must be paid by the lessee. Art. 571. The usufructuary
shall have the right to enjoy any
Art. 569. Civil fruits are increase which the thing in usufruct
deemed to accrue daily, and belong to may acquire through accession, the
the usufructuary in proportion to the servitudes established in its favor,
time the usufruct may last. and, in general, all the benefits
inherent therein.
Art. 570. Whenever a usufruct
is constituted on the right to receive a The usufructuary shall have the right to
rent or periodical pension, whether in enjoy any increase which the thing in
money or in fruits, or in the interest usufruct may acquire through accession,
on bonds or securities payable to the servitudes established in its favor,
bearer, each payment due shall be and, in general, all the benefits inherent
considered as the proceeds or fruits of therein.
such right.
Whenever it consists in the 3. Right to alienate the right of usufruct
enjoyment of benefits accruing from a (Articles 572, 590)
participation in any industrial or
commercial enterprise, the date of the Art. 572. The usufructuary
distribution of which is not fixed, such may personally enjoy the thing in
benefits shall have the same usufruct, lease it to another, or
character. alienate his right of usufruct, even by
In either case they shall be a gratuitous title; but all the contracts
distributed as civil fruits, and shall be he may enter into as such
applied in the manner prescribed in usufructuary shall terminate upon the
the preceding article. expiration of the usufruct, saving
leases of rural lands, which shall be
Entitled to all the natural, industrial, considered as subsisting during the
and civil fruits of the property in agricultural year.
usufruct.
Natural or industrial fruits growing at Art. 590. A usufructuary who
the time the usufruct begins, belong to alienates or leases his right of
the usufructuary. Those growing at the usufruct shall answer for any damage
time the usufruct terminates belong to which the things in usufruct may
the owner.

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Professor Ruben F. Balane Page 121 of 241
 suffer through the fault or negligence possible to do so without damage to
of the person who substitutes him. the property.

The usufructuary may lease or alienate Such right exists as long as he does not
his right of usufruct, even by gratuitous alter the propertys form or substance.
title. The usufructuary shall have no right of
All the contracts he may enter into as reimbursement.
such usufructuary shall terminate upon The usufructuary may remove use
the expiration of the usufruct except improvements if it is possible to do so
lease of rural lands, which shall be without causing damage to the property.
considered as subsisting during the
agricultural year. 6. Right to any increase in the value due
A usufructuary who alienates or leases to indispensable repairs made (Article
his right of usufruct shall answer for any 594)
damage which the things in usufruct
may suffer through the fault or Art. 594. If the owner should
negligence of the person who make the extraordinary repairs, he
substituted him. shall have a right to demand of the
usufructuary the legal interest on the
4. Right to recover (Article 578) amount expended for the time that the
usufruct lasts.
Art. 578. The usufructuary of Should he not make them when
an action to recover real property or a they are indispensable for the
real right, or any movable property, preservation of the thing, the
has the right to bring the action and to usufructuary may make them; but he
oblige the owner thereof to give him shall have a right to demand of the
the authority for this purpose and to owner, at the termination of the
furnish him whatever proof he may usufruct, the increase in value which
have. If in consequence of the the immovable may have acquired by
enforcement of the action he acquires reason of the repairs.
the thing claimed, the usufruct shall
be limited to the fruits, the dominion The usufruct who has made the
remaining with the owner. extraordinary repairs necessary for
preservation is entitled to recover from
The usufructuary of an action to recover the owner the increase in value which
real property or a real right, or movable the tenement acquired by reason of such
property, has the right to bring the work.
action.
The owner is obligated to give him the E. Obligations of the Usufructuary
authority for this purpose and to furnish 1. To make an inventory (Article 583)
him whatever proof he may have.
If in consequence of the enforcement of Art. 583. The usufructuary,
the action he acquires the thing before entering upon the enjoyment of
claimed, the usufruct shall be limited to the property, is obliged:
the fruits, the dominion remaining with (1) To make, after notice to the
the owner. owner or his legitimate
representative, an inventory
5. Right to make useful and ornamental of all the property, which
expenses (Article 579) shall contain an appraisal of
the movables and a
Art. 579. The usufructuary description of the condition
may make on the property held in of the immovables;
usufruct such useful improvements or (2) To give security, binding
expenses for mere pleasure as he may himself to fulfill the
deem proper, provided he does not obligations imposed upon
alter its form or substance; but he him in accordance with this
shall have no right to be indemnified Chapter.
therefor. He may, however, remove
such improvements, should it be

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Professor Ruben F. Balane Page 122 of 241
 Inventory contains an appraisal of the Exceptions to Giving of Inventory
movables and a description of the a. No one will be injured (Article 585)
immovables.
Effect of Not Giving: Articles 586, 599 Art. 585. The
usufructuary, whatever may be
Art. 586. Should the the title of the usufruct, may be
usufructuary fail to give security in excused from the obligation of
the cases in which he is bound to give making an inventory or of
it, the owner may demand that the giving security, when no one
immovables be placed under will be injured thereby.
administration, that the movables be
sold, that the public bonds, b. Waiver of owner (i.e. stipulation in
instruments of credit payable to order the will or contract)
or to bearer be converted into
registered certificates or deposited in 2. Give security (Article 583)
a bank or public institution, and that
the capital or sums in cash and the Art. 583. The usufructuary,
proceeds of the sale of the movable before entering upon the enjoyment of
property be invested in safe securities. the property, is obliged:
The interest on the proceeds of (1) To make, after notice to the
the sale of the movables and that on owner or his legitimate
public securities and bonds, and the representative, an inventory of
proceeds of the property placed under all the property, which shall
administration, shall belong to the contain an appraisal of the
usufructuary. movables and a description of
Furthermore, the owner may, the condition of the
if he so prefers, until the usufructuary immovables;
gives security or is excused from so (2) To give security, binding
doing, retain in his possession the himself to fulfill the obligations
property in usufruct as administrator, imposed upon him in
subject to the obligation to deliver to accordance with this Chapter.
the usufructuary the net proceeds
thereof, after deducting the sums Effect of Not Giving:
which may be agreed upon or a. The owner may demand the
judicially allowed him for such following
administration. 1. That
the immovables be placed under
Art. 599. The usufructuary administration
may claim any matured credits which 2. That
form a part of the usufruct if he has the movables be sold
given or gives the proper security. If 3. That
he has been excused from giving the public bonds, instruments of
security or has been able to give it, or credit payable to order or bearer
if that given is not sufficient, he shall be converted into registered
need the authorization of the owner, certificates or deposited in a
or of the court in default thereof, to bank or public institution
collect such credits. 4. That
The usufructuary who has the capital or sums of in cash
given security may use the capital he and the proceeds of the sale of
has collected in any manner he may the movable property be
deem proper. The usufructuary who invested in safe securities
has not given security shall invest the The interest on the proceeds
said capital at interest upon of the sale of the movables
agreement with the owner; in default and that on the public
of such agreement, with judicial securities and bonds and
authorization; and, in every case, with the proceeds of the property
security sufficient to preserve the placed under administration
integrity of the capital in usufruct. shall belong to the
usufructuary.

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Professor Ruben F. Balane Page 123 of 241
 b. The owner if he so prefers shall except when the parents
retain possession of the property as contract a second marriage.
administrator until security is given.
c. The usufructuary who has not given e. In case of caucion juratoria (Article
security shall invest the capital 587)
collected at interest upon agreement
with the owner; in default of the Art. 587. If the
agreement with judicial usufructuary who has not
authorization. given security claims, by virtue
Instances when Security is Not Required of a promise under oath, the
a. No one will be injured (Article 585) delivery of the furniture
necessary for his use, and that
Art. 585. The he and his family be allowed to
usufructuary, whatever may be live in a house included in the
the title of the usufruct, may be usufruct, the court may grant
excused from the obligation of this petition, after due
making an inventory or of consideration of the facts of
giving security, when no one the case.
will be injured thereby. The same rule shall be
observed with respect to
b. Waiver implements, tools and other
c. If usufructuary is the donor of the movable property necessary
property (Article 584) for an industry or vocation in
which he is engaged.
Art. 584. The If the owner does not
provisions of No. 2 of the wish that certain articles be
preceding article shall not sold because of their artistic
apply to the donor who has worth or because they have a
reserved the usufruct of the sentimental value, he may
property donated, or to the demand their delivery to him
parents who are usufructuaries upon his giving security for the
of their children's property, payment of the legal interest
except when the parents on their appraised value.
contract a second marriage.
Caucion juratoria refers to the
d. In case of usufruct by parents case contemplated by Art. 587
(Article 226, 2, Family Code) whereby the usufructuary, being
unable to file the required bond
Article 226, 2. The or security, files a verified
right of the parents over the petition in the proper court,
fruits and income of the child's asking for the delivery of the
property shall be limited house and furniture necessary
primarily to the child's support for himself and his family
and secondarily to the without any bond or security.
collective daily needs of the The same rule shall also be
family. applied to the instruments or
tools necessary for an industry
Exception: When the parents or vocation in which the
contract a 2nd marriage (Article usufructuary is engaged.
584)
3. Due care (Articles 589, 610)
Art. 584. The
provisions of No. 2 of the Art. 589. The usufructuary
preceding article shall not shall take care of the things given in
apply to the donor who has usufruct as a good father of a family.
reserved the usufruct of the
property donated, or to the Art. 610. A usufruct is not
parents who are usufructuaries extinguished by bad use of the thing in
of their children's property, usufruct; but if the abuse should cause

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Professor Ruben F. Balane Page 124 of 241
 considerable injury to the owner, the usufruct shall continue on the part
latter may demand that the thing be saved.
delivered to him, binding himself to Should the usufruct be on
pay annually to the usufructuary the sterile animals, it shall be considered,
net proceeds of the same, after with respect to its effects, as though
deducting the expenses and the constituted on fungible things.
compensation which may be allowed
him for its administration. If the usufruct be over livestock, the
usufructuary is obligated to replace with
Take care of the things in usufruct as a the young, the animals that die each
good father of a family. year from natural causes or lost due to
Bad use of the thing in usufruct shall not the rapacity of beasts.
extinguish the usufruct. However, if the If the animals on which the usufruct is
abuse should cause considerable injury constituted should all perish, without
to the owner, the owner may demand the fault of the usufructuary, on account
that the thing be delivered to him. If the of some contagious disease or any other
thing is delivered to the owner, the uncommon event, the usufructuary shall
owner shall deliver to the usufructuary fulfill his obligation by delivering to the
the net proceeds. owner the remains which may have been
saved.
4. Answer for damages caused by his
substitutes fault or negligence (Article 6. Make ordinary repairs (Article 592)
590)
Art. 592. The usufructuary is
Art. 590. A usufructuary who obliged to make the ordinary repairs
alienates or leases his right of needed by the thing given in usufruct.
usufruct shall answer for any damage By ordinary repairs are
which the things in usufruct may understood such as are required by
suffer through the fault or negligence the wear and tear due to the natural
of the person who substitutes him. use of the thing and are indispensable
for its preservation. Should the
If the usufructuary alienates or leases usufructuary fail to make them after
his right of usufruct, in case the things demand by the owner, the latter may
in usufruct should suffer damage by the make them at the expense of the
fault or negligence of the usufructuarys usufructuary.
substitute, the usufructuary is liable.
The usufructuary is obligated to make
5. Usufruct over livestock (Article 591) ordinary repairs.
Ordinary repairs mean those repairs
Art. 591. If the usufruct be which arise out of the normal wear and
constituted on a flock or herd of tear of use.
livestock, the usufructuary shall be If the usufructuary does not make
obliged to replace with the young ordinary repairs, the owner may make
thereof the animals that die each year ordinary repairs at the expense of the
from natural causes, or are lost due to usufructuary.
the rapacity of beasts of prey.
If the animals on which the 7. To notify the owner of urgent repairs
usufruct is constituted should all (Article 593)
perish, without the fault of the
usufructuary, on account of some Art. 593. Extraordinary
contagious disease or any other repairs shall be at the expense of the
uncommon event, the usufructuary owner. The usufructuary is obliged
shall fulfill his obligation by delivering to notify the owner when the need
to the owner the remains which may for such repairs is urgent.
have been saved from the misfortune.
Should the herd or flock perish The usufructuary is obligated to notify
in part, also by accident and without the owner when the need for such
the fault of the usufructuary, the repairs is urgent.

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Professor Ruben F. Balane Page 125 of 241
 8. To pay interest on the amount been paid in that character; and, if the
expended for extraordinary repairs said sums have been advanced by the
(Article 594) usufructuary, he shall recover the
amount thereof at the termination of
Art. 594. If the owner should the usufruct.
make the extraordinary repairs, he
shall have a right to demand of the Annual charges and taxes imposed on
usufructuary the legal interest on the the fruits are shouldered by the
amount expended for the time that the usufructuary.
usufruct lasts. Land taxes on the usufruct are
Should he not make them when shouldered by the owner.
they are indispensable for the
preservation of the thing, the 11. To notify the owner of any act of a
usufructuary may make them; but he 3rd person (Article 601)
shall have a right to demand of the
owner, at the termination of the Art. 601. The usufructuary
usufruct, the increase in value which shall be obliged to notify the owner of
the immovable may have acquired by any act of a third person, of which he
reason of the repairs. may have knowledge, that may be
prejudicial to the rights of ownership,
If the owner should make extraordinary and he shall be liable should he not do
repairs, the usufructuary is liable to pay so, for damages, as if they had been
legal interest on the amount expended caused through his own fault.
until the expiration of the usufruct.
If the usufructuary does not notify the
9. Allow work by owner which does not owner of the any prejudicial act by a 3 rd
prejudice the usufructuary (Article 595) person, the usufructuary shall be liable
for damages.
Art. 595. The owner may
construct any works and make any 12. Shoulder the expenses, costs, and
improvements of which the liabilities in suits involving the
immovable in usufruct is susceptible, usufruct (Article 602)
or make new plantings thereon if it be
rural, provided that such acts do not Art. 602. The expenses, costs
cause a diminution in the value of the and liabilities in suits brought with
usufruct or prejudice the right of the regard to the usufruct shall be borne
usufructuary. by the usufructuary.

The owner may construct works and 13. Return the thing at the termination
improvements provided that such acts of the usufruct (Article 612)
do not cause a diminution of the value of
the usufruct or prejudice the right of the Art. 612. Upon the termination
usufructuary. of the usufruct, the thing in usufruct
shall be delivered to the owner,
10. Pay annual charges (Articles 596-597) without prejudice to the right of
retention pertaining to the
Art. 596. The payment of usufructuary or his heirs for taxes and
annual charges and taxes and of those extraordinary expenses which should
considered as a lien on the fruits, shall be reimbursed. After the delivery has
be at the expense of the usufructuary been made, the security or mortgage
for all the time that the usufruct lasts. shall be cancelled.

Art. 597. The taxes which, If in case the usufructuary or his heirs
during the usufruct, may be imposed should be reimbursed, there would be a
directly on the capital, shall be at the right of retention by the usufructuary or
expense of the owner. the heirs.
If the latter has paid them, the After delivery of the thing, the security
usufructuary shall pay him the proper shall be cancelled.
interest on the sums which may have

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Professor Ruben F. Balane Page 126 of 241
 F. Extinguishment of the Usufruct
1. By death of the usufructuary (Article A. Characteristics
603 (1)) 1. Always a real right
Exceptions Basic Rule: There can be NO
a. Contrary intention easement on personal property.
b. Definite period 2. Can only be imposed only on the property of
c. When the usufruct is in favor of another
several persons It cannot be imposed on your property.
i. Successively or 3. Produces limitations on ownership but the
ii. Simultaneously ownership is not impaired
2. By the expiration of the period for 4. Inseparable from the tenements from which
which it was constituted or by the it is passively or actively attached (Article
fulfillment of any resolutory condition 617)
(Article 603 (2))
3. By merger of the usufruct and Art. 617. Easements are
ownership in the same person (Article inseparable from the estate to which
603 (3)) they actively or passively belong.
4. By renunciation of the usufructuary
(Article 603 (4)) 5. Indivisible
5. By the total loss of the thing in
usufruct (Article 603 (5)) B. Kinds of Easements
6. By the termination of the right of the 1. As to Benefit
person constituting the usufruct a. Real (Article 613)
(Article 603 (6))
7. By prescription (Article 603 (7)) Art. 613. An easement
8. Non-fulfillment of a mode imposed on the or servitude is an encumbrance
usufructuary imposed upon an immovable for
9. Rescission or annulment of the contract the benefit of another immovable
10. Legal ways of extinguishing usufruct (i.e. belonging to a different owner.
termination of parental authority The immovable in favor of
terminates the parents usufruct with which the easement is established
regard to the childs adventitious is called the dominant estate; that
property) which is subject thereto, the
11. Mutual dissent servient estate.
12. Alienation by innocent purchaser for value
(Article 709) A real easement is one in favor of
13. Happening of a resolutory condition another immovable the dominant
estate.
V. EASEMENTS This is more common than the
An easement is a real right constituted in personal easement.
anothers tenement whereby the owner of the
latter must refrain from doing or allow b. Personal
something to be done on his property for the A personal easement is in favor of a
benefit of another thing or person. community, or of one or more
The term is easement is a common-law term. persons to whom the encumbered
Servitude is the civil law term. A servitude is estate does not belong (i.e. easement
broader in scope. For example, an easement for drawing water).
does not include the right to draw water.
However at present, both terms are 2. As to Manner of Exercise (Article 615)
interchangeable.
An easement grants less rights than a usufruct. Art. 615. Easements may be
An easement never carries with it the right to continuous or discontinuous,
possess. The rights granted by an easement are apparent or nonapparent.
very limited. Continuous easements are
those the use of which is or may be

Art. 709. The titles of ownership, or of other rights incessant, without the intervention of
over immovable property, which are not duly inscribed any act of man.
or annotated in the Registry of Property shall not
prejudice third persons.

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Professor Ruben F. Balane Page 127 of 241
 Discontinuous easements are Positive easements are those which
those which are used at intervals and impose upon the owner of the
depend upon the acts of man. servient estate the obligation of
Apparent easements are those allowing something to be done or of
which are made known and are doing it himself.
continually kept in view by external i. In patiendo (Article 680, 1st part)
signs that reveal the use and Allowing something to be done
enjoyment of the same. ii. In faciendo (Article 680, 2nd part)
Nonapparent easements are Doing it yourself
those which show no external b. Negative
indication of their existence. Negative easements are those which
prohibit the owner of the servient
a. Continuous estate from doing something which
Continuous easements are those the he could lawfully do if the easement
use of which is or may be incessant, did not exist. In allowing someone
without the intervention of any act to do something in your estate, you
of man. are prohibited from preventing that
b. Discontinuous person from doing that something.
Discontinuous easements are those NOTE: Some commentators believe
which are used at intervals and that all easements are negative.
depend upon the acts of man (i.e. Easements are restrict the owners from
right of way) doing something which they could
otherwise do. What appear to be
3. As to Indication of Existence (Article positive easements are in fact really
615) negative easements.
a. Apparent 1. As to Source
Apparent easements are those which a. Voluntary (Article 619)
are made known and are continually
kept in view by external signs that Art. 619. Easements
reveal the use and enjoyment of the are established either by law or by
same. the will of the owners. The former
For example, a right of way is are called legal and the latter
apparent if the path is marked off. voluntary easements.
b. Non-apparent
Non-apparent easements are those Established by the will of the owners
which show no external indication In North Negros Sugar Central vs.
of their existence. Hidalgo, North Negros Sugar
For example, a right of way is non- Central (NNSC) constructed across
apparent if the path is not marked. its properties a road connecting the
mill site with the provincial
4. As to Nature of the Limitation (Article highway. NNSC made the road
616) accessible to the public, a toll fee
being charged in cases of motor
Art. 616. Easements are also vehicles, & pedestrians being
positive or negative. allowed free passage. A tuba saloon
A positive easement is one was in the adjoining hacienda. The
which imposes upon the owner of the owner pf the saloon passed through
servient estate the obligation of the connecting road as it was his
allowing something to be done or of only means of access. NNSC sought
doing it himself, and a negative to enjoin the owner of the tuba
easement, that which prohibits the saloon from using the road in
owner of the servient estate from question since NNSCs workers got
doing something which he could drunk.
lawfully do if the easement did not There are 2 very persuasive views in
exist. the case of NNSC vs. Hidalgo. The
majority said that NNSC voluntarily
a. Positive constituted an easement of way in
favor of the general public. NNSC

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Professor Ruben F. Balane Page 128 of 241
 could not discriminate against the owner of both, shall be
certain persons who may want to considered, should either of
use the road. This is clearly a case of them be alienated, as a title in
a servitude voluntarily constituted order that the easement may
in favor of the community under continue actively and passively,
Article 531. Having been devoted by unless, at the time the
NNSC to the use of the public in ownership of the two estates is
general, the road is charged w/ divided, the contrary should be
public interest & while so devoted. provided in the title of
NNSC may not establish conveyance of either of them,
discriminatory exceptions against or the sign aforesaid should be
any private persons. removed before the execution
The dissent said that there was no of the deed. This provision
easement by using the process of shall also apply in case of the
elimination. A voluntary easement division of a thing owned in
can be created only by will, by a common by two or more
donation or by a contract. In this persons.
case, there was no will, donation, or
contract. In Amor vs. Florentino owned a
b. Legal (Article 619) house and a camarin. The
Established by law house had 3 windows. From the
c. Mixed said windows the house receives
A mixed easement can be acquired light and air from the lot where
through prescription the camarin stood. The camarin
and the house were disposed of.
C. 2 Modes of Acquiring Easements The windows were not closed.
1. Title The SC said that an easement of
Title means the juridical act which gives light and view had been
rise to the servitude (i.e. law, donation, established. When ownership
contract, will) passed to theirs, nothing was
All kinds of easements can be created by done to the windows. The new
title owner of the house continued to
a. Continuous and apparent easements exercise the right of receiving
b. Continuous and non-apparent light and air through those
easements windows. The visible and
c. Discontinuous and apparent permanent sign of an easement
easements is the title that characterizes its
d. Discontinuous and non-apparent existence. Existence of the
easements apparent sign had the same
Equivalents of Title effect as a title of acquisition of
a. Deed of recognition (Article 623) the easement of light and view
upon death of original owner.
Art. 623. The absence There is an error in Article 624
of a document or proof according to Professor Balane.
showing the origin of an Article 624 provides The
easement which cannot be existence. as title in order that
acquired by prescription may the easement may continue
be cured by a deed of According to Professor Balane,
recognition by the owner of the the use of the word continue is
servient estate or by a final wrong. It should be the
judgment. easement may arise since there
is no easement yet. There is no
b. Final judgment (Article 623) easement yet since both
c. Apparent sign (Article 624) properties have only 1 owner.
There are only seeds of a
Art. 624. The existence potential easement.
of an apparent sign of 2. Prescription
easement between two estates,
established or maintained by

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Professor Ruben F. Balane Page 129 of 241
 ONLY continuous and apparent
easements may be created by Art. 626. The owner of the
prescription. dominant estate cannot use the easement
In order for an easement to be acquired except for the benefit of the immovable
by prescription, good faith or bad faith is originally contemplated. Neither can he
irrelevant. The easement can be exercise the easement in any other
acquired after the lapse of 10 years. manner than that previously established.
Counting of the 10 year prescriptive
period Article 626 is a classic case of an intent that
a. Positive easements failed. Article 626 was meant to overrule the
Start counting from the 1st act ruling in Valderrama vs. North Negros
constituting the exercise of the Sugar Co.
easement was performed. In Valderrama vs. North Negros Sugar Co.,
b. Negative easements Valderrama executed a contract with North
Start counting from the time Negros (NNSC) whereby NNSC agreed to
when the owner of the dominant install a sugar central of minimum capacity
estate serves a notarial of 300 tons for grinding and milling al sugar
prohibition on the owner of the cane grown by Valderrama who in turn
prospective servient estate. bound himself to furnish the central all the
NOTE: Most easements are clearly cane they might produce. A railroad was
positive or negative easements. constructed on Valderramas land to
However, an easement of light and view transport the sugarcane harvested. However,
is both a positive and a negative Valderrama was unable to supply the
easement. There are special rules to required amount of sugarcane. NNSC had to
determine the counting of the contract with other sugarcane growers.
prescriptive period. Valderrama alleges that the easement
a. Start counting from the 1st act granted in favor of North Negros was only
constituting the exercise of the for the transportation of the sugarcane of
easement was performed if the Valderrama. The SC said that the easement
opening through which the light and was created to enable NNSC to build and
view passes is a party wall. maintain a railroad for transportation of
Rationale: If the neighbor sugar cane. To limit use exclusively to the
does not like the opening, he cane of the hacienda owners would make the
can always close it. contract ineffective. Furthermore, it is
b. Start counting from the time when against the nature of the easement to
the owner of the dominant estate pretend that it was established in favor of
serves a notarial prohibition on the the servient estates. The easement was
owner of the prospective servient created in favor of the corporation and not
estate if the opening is made on for the hacienda owners. The corporation
the dominant owners own wall. may allow its wagons to pass by the tracks as
Rationale: The neighbor many times as it may deem fit.
cannot close the opening since The solution to the problem in Valderrama
its in the vs. NNSC would be to stipulate in the
dominant owners property. contract that a violation of the any of the
conditions would terminate the easement.
Art. 625. Upon the establishment
of an easement, all the rights necessary Art. 627. The owner of the
for its use are considered granted. dominant estate may make, at his own
expense, on the servient state any works
Upon the establishment of an easement, all necessary for the use and preservation of
the rights necessary for its use are the servitude, but without altering it or
considered granted. rendering it more burdensome.
For this purpose he shall notify the
An example of this is Article 641. An
owner of the servient estate, and shall
easement for drawing water may carry with
choose the most convenient time and
it the easement of right of way. If the well is
manner so as to cause the least
in the middle of someone elses property
inconvenience to the owner of the
how can one draw water without having to
servient estate.
pass through that persons property?

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Professor Ruben F. Balane Page 130 of 241
 At his own expense, the owner of the In the case of legal easements, the right
dominant estate may make any works on the to claim is never extinguished. All the
servient estate which are necessary for the dominant owner of the estate has to do
use and preservation of the servitude. is to claim it.
Such works cannot alter or make the 3. When either or both of the estates fall
servitude more burdensome. into such condition that the easement
The owner of the dominant estate must cannot be used. However, it shall be
notify the owner of the servient estate. The revived if the subsequent condition of
owner of the dominant estate must choose either or both of the estates should
the most convenient time and manner so as permit its use. This is however
to cause the least inconvenience to the subject to extinctive prescription
owner of the servient estate. This is not a ground for
extinguishments. This is a ground for
Art. 628. Should there be several suspension of the easement. The
dominant estates, the owners of all of suspension may eventually lead to
them shall be obliged to contribute to the extinguishment of the easement if there
expenses referred to in the preceding is extinctive prescription.
article, in proportion to the benefits 4. Expiration of the term of the
which each may derive from the work. fulfillment of the condition
Any one who does not wish to contribute 5. Renunciation of the owner of the
may exempt himself by renouncing the dominant estate
easement for the benefit of the others. There is dispute as to whether or not the
If the owner of the servient estate renunciation can be tacit or not.
should make use of the easement in any According to Professor Balane, it can be
manner whatsoever, he shall also be tacit under Article 6 of the Civil Code.
obliged to contribute to the expenses in Rights may be waived. There is no
the proportion stated, saving an prescribed form.
agreement to the contrary. 6. Buy off the easement
7. Expropriation of the servient estate
If there are several dominant estates with a There can be no easement over property
common servitude, the expenses for its use of the public dominion.
and preservation shall be shouldered by the 8. Permanent impossibility to make use
owners of the dominant estates in of the easement
proportion to the benefit that they receive. 9. Annulment or cancellation of the
In the absence of proof to the contrary, the contract of easement
presumption is that the benefits are equal. 10. Resolution of grantors right to
If the owner of the servient estate also create the easement
makes use of the servitude, he must also A sells land to B via a pacto de retro
contribute in proportion to the benefit he sale. B while being a vendee de retro
receives. grants an easement to C. If A, the
vendor, redeems, the easement given to
D. Extinguishment of Easements C is extinguished.
1. By merger of ownership of the 11. Registration of the servient estate as
dominant and servient estates free and without any encumbrance
The merger must be complete, absolute in the Torrens System in favor of an
and permanent. innocent purchaser for value
If the owner of the servient estate 12. Cessation of necessity, in case of a
becomes a co-owner of the dominant legal easement of right of way (Article
estate, the easement subsists since the 655)
merger is not complete. E. Legal Easements (Proper)
If the sale is a pacto de retro sale, then

the merger is not complete. The Art. 655. If the right of way granted to a
easement is only suspended surrounded estate ceases to be necessary because its
owner has joined it to another abutting on a public
2. Extinctive prescription road, the owner of the servient estate may demand
All the dominant owner of the estate has that the easement be extinguished, returning what he
to do is to stop using it continuously. may have received by way of indemnity. The interest
on the indemnity shall be deemed to be in payment of
rent for the use of the easement.

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Professor Ruben F. Balane Page 131 of 241
 1. Waters and without the intervention of
The Water Code (Articles 31-52) amends man flow from the higher estate,
many of the easements. as well as the stone or earth which
Articles 52 and 100 of the Water Code they carry with them.
are the repealing clauses The owner of the lower
Article 637 (natural drainage of lands) estate can not construct works
has been superseded by Article 50 of the which will impede this natural
Water Code. flow, unless he provides an
alternative method of drainage;
Art. 637. Lower estates are neither can the owner of the
obliged to receive the waters which higher estate make works which
naturally and without the will increase this natural flow.
intervention of man descend from
the higher estates, as well as the Article 638 (tow path) has been
stones or earth which they carry superseded by Article 51 of the Water
with them. Code.
The owner of the lower
estate cannot construct works Art. 638. The banks of
which will impede this easement; rivers and streams, even in case
neither can the owner of the they are of private ownership, are
higher estate make works which subject throughout their entire
will increase the burden. length and within a zone of three
meters along their margins, to the
Art. 50, Water Code. easement of public use in the
Lower estates are obliged to general interest of navigation,
receive the waters which naturally floatage, fishing and salvage.
Estates adjoining the banks
The same rule shall be applied in case a new of navigable or floatable rivers are,
road is opened giving access to the isolated estate. furthermore, subject to the
In both cases, the public highway must easement of towpath for the
substantially meet the needs of the dominant estate in exclusive service of river
order that the easement may be extinguished. navigation and floatage.

Art. 52. The establishment, extent, form, and If it be necessary for such
conditions of easements of water not expressly purpose to occupy lands of private
determined by the provisions of this Code shall be ownership, the proper indemnity
governed by the provisions of the Civil Code. shall first be paid.
Art. 100. The following laws, parts and/or
provisions of laws are hereby repealed: Art. 51, Water Code. The
a. The provisions of the Spanish Law on Waters of banks of rivers and streams and
August 3, 1866, the Civil Code of Spain of the shores of the seas and lakes
1889 and the Civil Code of the Philippines (R.A. throughout their entire length and
386) on ownership of waters, easements within a zone of three (3) meters
relating to waters, use of public waters and in urban areas, twenty (20) meters
acquisitive prescription on the use of waters, in agricultural areas and forty (40)
which are inconsistent with the provisions of meters in forest areas, along their
this Code; margins are subject to the
b. The provisions of R.A. 6395, otherwise known easement of public use in the
as the Revised Charter of National Power interest of recreation, navigation,
Corporation, particularly section 3, paragraph floatage, fishing and salvage. No
(f), and section 12, insofar as they relate to person shall be allowed to stay in
the appropriation of waters and the grant this zone longer than what is
thereof; necessary for recreation,
c. The provisions of Act No. 2152, as amended, navigation, floatage, fishing or
otherwise known as the Irrigation Act, section salvage or to build structures of
3, paragraphs (k) and (m) of P.D. No. 813, any kind.
R.A. 2056; Section 90, C.A. 137; and,
d. All Decree, Laws, Acts, parts of Acts, rules of
Court, executive orders, and administrative
Article 639 (easement of dam) has been
regulations which are contrary to or superseded by Articles 38 and 39 of the
inconsistent with the provisions of this Code. Water Code.

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Professor Ruben F. Balane Page 132 of 241
 persons and animals to the place
Art. 639. Whenever for the where such easements are to be
diversion or taking of water from a used, and the indemnity shall
river or brook, or for the use of include this service.
any other continuous or
discontinuous stream, it should be Articles 642-646 are the provisions for
necessary to build a dam, and the the easement of aqueduct. This should
person who is to construct it is not be correlated with Article 49 of the
the owner of the banks, or lands Water Code.
which must support it, he may
establish the easement of Art. 642. Any person
abutment of a dam, after payment who may wish to use upon his own
of the proper indemnity. estate any water of which he can
dispose shall have the right to
Art. 38, Water Code. make it flow through the
Authority for the construction of intervening estates, with the
dams, bridges and other obligation to indemnify their
structures across of which may owners, as well as the owners of
interfere with the flow of the lower estates upon which the
navigable or flotable waterways waters may filter or descend.
shall first be secured from the
Department of Public Works, Art. 643. One desiring
Transportation and to make use of the right granted in
Communications. the preceding article is obliged:
(1) To prove that he can
Art. 39, Water Code. dispose of the water and
Except in cases of emergency to that it is sufficient for the
save life or property, the use for which it is
construction or repair of the intended;
following works shall be (2) To show that the
undertaken only after the plans proposed right of way is
and specifications therefor, as may the most convenient and
be required by the Council, are the least onerous to third
approved by the proper persons;
government agency; dams for the (3) To indemnify the owner
diversion or storage of water; of the servient estate in
structures for the use of water the manner determined
power, installations for the by the laws and
utilization of subterranean or regulations.
ground water and other structures
for utilization of water resources. Art. 644. The easement
of aqueduct for private interest
Articles 640-641 are the provisions cannot be imposed on buildings,
regarding easement for drawing of courtyards, annexes, or
waters. outhouses, or on orchards or
gardens already existing.
Art. 640. Compulsory
easements for drawing water or Art. 645. The easement
for watering animals can be of aqueduct does not prevent the
imposed only for reasons of public owner of the servient estate from
use in favor of a town or village, closing or fencing it, or from
after payment of the proper building over the aqueduct in such
indemnity. manner as not to cause the latter
any damage, or render necessary
Art. 641. Easements repairs and cleanings impossible.
for drawing water and for
watering animals carry with them Art. 646. For legal
the obligation of the owners of the purposes, the easement of
servient estates to allow passage to aqueduct shall be considered as

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Professor Ruben F. Balane Page 133 of 241
 continuous and apparent, even Art. 649. The owner, or any
though the flow of the water may person who by virtue of a real right
not be continuous, or its use may cultivate or use any immovable,
depends upon the needs of the which is surrounded by other
dominant estate, or upon a immovables pertaining to other
schedule of alternate days or persons and without adequate outlet
hours. to a public highway, is entitled to
demand a right of way through the
Article 647 is the easement for the neighboring estates, after payment of
construction of stop lock and sluice gate. the proper indemnity.
Should this easement be
Art. 647. One who for established in such a manner that its
the purpose of irrigating or use may be continuous for all the
improving his estate, has to needs of the dominant estate,
construct a stop lock or sluice gate establishing a permanent passage, the
in the bed of the stream from indemnity shall consist of the value of
which the water is to be taken, may the land occupied and the amount of
demand that the owners of the the damage caused to the servient
banks permit its construction, estate.
after payment of damages, In case the right of way is
including those caused by the new limited to the necessary passage for
easement to such owners and to the cultivation of the estate
the other irrigators. surrounded by others and for the
gathering of its crops through the
Article 25 of the Water Code is the servient estate without a permanent
easement for appropriation and use of way, the indemnity shall consist in the
waters. payment of the damage caused by
such encumbrance.
Art. 25, Water Code. A This easement is not
holder of water permit may compulsory if the isolation of the
demand the establishment of immovable is due to the proprietor's
easements necessary for the own acts.
construction and maintenance of
the works and facilities needed for Art. 650. The easement of
the beneficial use of the waters to right of way shall be established at the
be appropriated subject to the point least prejudicial to the servient
requirements of just estate, and, insofar as consistent with
compensation and to the following this rule, where the distance from the
conditions: dominant estate to a public highway
a. That he is the owner, may be the shortest.
lessee, mortgagee or one
having real right over the Art. 651. The width of the
land upon which he easement of right of way shall be that
proposes to use water; and which is sufficient for the needs of the
b. That the proposed dominant estate, and may accordingly
easement is the most be changed from time to time.
convenient and the least Art. 652. Whenever a piece of
onerous to the servient land acquired by sale, exchange or
estate. partition, is surrounded by other
Easements relating to the estates of the vendor, exchanger, or
appropriation and use of waters co-owner, he shall be obliged to grant
may be modified by agreement of a right of way without indemnity.
the contracting parties provided In case of a simple donation,
the same is not contrary to law or the donor shall be indemnified by the
prejudicial to third persons. donee for the establishment of the
right of way.
2. Right of way (Articles 649-657)
Art. 653. In the case of the
preceding article, if it is the land of the

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Professor Ruben F. Balane Page 134 of 241
 grantor that becomes isolated, he may meters, and the animal trail that of 37
demand a right of way after paying a meters and 50 centimeters.
indemnity. However, the donor shall Whenever it is necessary to
not be liable for indemnity. establish a compulsory easement of
the right of way or for a watering
Art. 654. If the right of way is place for animals, the provisions of
permanent, the necessary repairs this Section and those of articles 640
shall be made by the owner of the and 641 shall be observed. In this case
dominant estate. A proportionate the width shall not exceed 10 meters.
share of the taxes shall be reimbursed
by said owner to the proprietor of the Requisites for an Easement of Right of
servient estate. Way
a. The dominant estate is surrounded
Art. 655. If the right of way by other immovables without an
granted to a surrounded estate ceases adequate outlet to a public highway
to be necessary because its owner has The right of way may be
joined it to another abutting on a demanded:
public road, the owner of the servient i. When there is absolutely no
estate may demand that the easement access to a public highway
be extinguished, returning what he ii. When, even if there is one, it
may have received by way of is difficult or dangerous to
indemnity. The interest on the use, or is grossly insufficient
indemnity shall be deemed to be in (i.e. access is through a
payment of rent for the use of the steep cliff)
easement. Mere inconvenience is not
The same rule shall be applied aground for demanding the
in case a new road is opened giving easement of right of way (i.e.
access to the isolated estate. there is an adequate outlet, but
In both cases, the public it is not paved)
highway must substantially meet the b. The dominant estate is willing to
needs of the dominant estate in order pay the proper indemnity
that the easement may be If the right of way is permanent,
extinguished. payment shall be equivalent to
the value of the land occupied
Art. 656. If it be indispensable and the amount of the damage
for the construction, repair, caused to the servient estate.
improvement, alteration or Such payment for permanent
beautification of a building, to carry use does not mean that the
materials through the estate of owner of the dominant estate
another, or to raise therein now owns such portion of the
scaffolding or other objects necessary land.
for the work, the owner of such estate
If a piece of land is acquired by
shall be obliged to permit the act, after
sale, exchange, partition or
receiving payment of the proper
partition, and the land is
indemnity for the damage caused him.
surrounded by other estates of
the vendor, exchanger or co-
Art. 657. Easements of the
owner, a right of way shall be
right of way for the passage of
given without having to pay the
livestock known as animal path,
indemnity (Article 652)
animal trail or any other, and those
If it is the land of the vendor,
for watering places, resting places and
exchanger or co-owner that
animal folds, shall be governed by the
becomes isolated, he may
ordinances and regulations relating
demand a right of way, provided
thereto, and, in the absence thereof,
that he pay the proper
by the usages and customs of the
indemnity (Article 653)
place.
Without prejudice to rights If a piece of land is acquired by
legally acquired, the animal path shall donation, and such land is
not exceed in any case the width of 75 surrounded by other estates of

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Professor Ruben F. Balane Page 135 of 241
 the donor, the donee must pay (1) In dividing walls of adjoining
the proper indemnity in order to buildings up to the point of
get a right of way (Article 652). common elevation;
If it is the land of the donor that (2) In dividing walls of gardens
becomes isolated, he may or yards situated in cities,
demand a right of way without towns, or in rural
having to pay the indemnity communities;
(Article 653). (3) In fences, walls and live
c. The isolation was not due to the acts hedges dividing rural lands.
of the proprietor of the dominant
estate Art. 660. It is understood that
In Article 649, it states that the there is an exterior sign, contrary to
isolation must not be due to the the easement of party wall:
act of the proprietor of the (1) Whenever in the dividing
dominant estate. Yet, in Article wall of buildings there is a
653, the proprietor of the window or opening;
dominant estate may demand (2) Whenever the dividing wall
an easement of right of way even is, on one side, straight and
though the isolation was caused plumb on all its facement,
by his act. Is there a conflict and on the other, it has
between Article 649 and Article similar conditions on the
653? To reconcile, Article 653 upper part, but the lower
deals with a specific instance. part slants or projects
d. That the right of way claimed is at outward;
the point least prejudicial to the (3) Whenever the entire wall is
servient estate; and insofar as built within the boundaries
consistent with this rule, where the of one of the estates;
distance from the dominant estate (4) Whenever the dividing wall
to a public highway may be the bears the burden of the
shortest. binding beams, floors and
Extinguishment of Easements of Right roof frame of one of the
of Way (Article 655) buildings, but not those of
The fact that an adequate outlet has the others;
been created does not automatically (5) Whenever the dividing wall
extinguish the a legal easement of between courtyards, gardens,
right of way. It must be asked for by and tenements is constructed
the owner of the servient estate. in such a way that the coping
The owner of the dominant estate sheds the water upon only
cannot demand that the easement one of the estates;
be extinguished. (6) Whenever the dividing wall,
being built of masonry, has
Article 655 is applicable only to
stepping stones, which at
legal easements of right of way. It
certain intervals project from
does not apply to voluntary
the surface on one side only,
easements of right of way.
but not on the other;
3. Party wall (Articles 658-666)
(7) Whenever lands inclosed by
fences or live hedges adjoin
Art. 658. The easement of
others which are not
party wall shall be governed by the
inclosed.
provisions of this Title, by the local
In all these cases, the
ordinances and customs insofar as
ownership of the walls, fences or
they do not conflict with the same,
hedges shall be deemed to belong
and by the rules of co-ownership.
exclusively to the owner of the
property or tenement which has in its
Art. 659. The existence of an
favor the presumption based on any
easement of party wall is presumed,
one of these signs.
unless there is a title, or exterior sign,
or proof to the contrary:
Art. 661. Ditches or drains
opened between two estates are also

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Professor Ruben F. Balane Page 136 of 241
 presumed as common to both, if there Art. 665. The other owners
is no title or sign showing the who have not contributed in giving
contrary. increased height, depth or thickness
There is a sign contrary to the to the wall may, nevertheless, acquire
part-ownership whenever the earth or the right of part-ownership therein,
dirt removed to open the ditch or to by paying proportionally the value of
clean it is only on one side thereof, in the work at the time of the acquisition
which case the ownership of the ditch and of the land used for its increased
shall belong exclusively to the owner thickness.
of the land having this exterior sign in
its favor. Art. 666. Every part-owner of
a party wall may use it in proportion
Art. 662. The cost of repairs to the right he may have in the co-
and construction of party walls and ownership, without interfering with
the maintenance of fences, live the common and respective uses by
hedges, ditches, and drains owned in the other co-owners.
common, shall be borne by all the
owners of the lands or tenements A party wall is a common wall built
having the party wall in their favor, in along the dividing line of 2 adjoining
proportion to the right of each. estates.
Nevertheless, any owner may Nature of a Party Wall
exempt himself from contributing to a. Easement
this charge by renouncing his part- Manresa and Castan believe that
ownership, except when the party wall a party wall is predominantly an
supports a building belonging to him. easement.
b. Co-ownership (i.e. Article 666)
Art. 663. If the owner of a Sanchez Roman believes that a
building, supported by a party wall party wall is predominantly a
desires to demolish the building, he co-ownership
may also renounce his part-ownership Special Characteristics of a
of the wall, but the cost of all repairs Party Wall as Co-Ownership
and work necessary to prevent any i. This co-ownership is
damage which the demolition may indivisible
cause to the party wall, on this
Cannot physically
occasion only, shall be borne by him.
divide
ii. The parts pertaining to each
Art. 664. Every owner may
co-owner can be materially
increase the height of the party wall,
designated and yet the
doing at his own expense and paying
whole wall is co-owned
for any damage which may be caused
iii. The rights of a co-owner of a
by the work, even though such
party wall are greater than
damage be temporary.
an ordinary co-owner
The expenses of maintaining
Maintenance and Repair of Party Wall
the wall in the part newly raised or
(Article 662)
deepened at its foundation shall also
be paid for by him; and, in addition, General Rule: The expense for
the indemnity for the increased the repair and maintenance of the
expenses which may be necessary for party wall shall be shouldered by the
the preservation of the party wall by co-owners in proportion to the right
reason of the greater height or depth of each.
which has been given it. Presumption: Co-owners have
If the party wall cannot bear equal proportion (share equally in
the increased height, the owner the expenses).
desiring to raise it shall be obliged to Exceptions:
reconstruct it at his own expense and, a. The expense for the repair of the
if for this purpose it be necessary to party wall can be shouldered by
make it thicker, he shall give the space 1 co-owner, but the co-owner
required from his own land. who does not contribute must

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Professor Ruben F. Balane Page 137 of 241
 renounce his share in the party vii. When 1 estate is
wall. enclosed but the other is
Commentators are of not
different opinions regarding Commentators do not agree
the extent of the as to whether or not this
renunciation total or enumeration is exclusive.
proportional to the amount c. Proof
of repairs. 4. Light and view (Articles 667-673)
b. When the defects are caused by
1 owner, he shall pay for all the Art. 667. No part-owner may,
expenses for repair without the consent of the others,
If the damage was due to open through the party wall any
the fault of one owner window or aperture of any kind.
Presumption of Party Wall
A party wall is presumed when a Art. 668. The period of
wall divides prescription for the acquisition of an
a. Adjoining buildings easement of light and view shall be
b. Gardens or yards situated in counted:
cities, towns or in rural (1) From the time of the opening
communities of the window, if it is through
c. Rural lands a party wall; or
This presumption may be rebutted if (2) From the time of the formal
there is a contrary prohibition upon the
a. Title; or proprietor of the adjoining
b. Exterior sign or land or tenement, if the
The following are exterior window is through a wall on
signs which will be rebut the the dominant estate.
presumption
i. A window or opening in Art. 669. When the distances
the dividing wall in article 670 are not observed, the
ii. On 1 side, the wall is owner of a wall which is not party
straight and then the wall, adjoining a tenement or piece of
wall juts out land belonging to another, can make
in it openings to admit light at the
A buttress is placed
height of the ceiling joints or
part where the wall
immediately under the ceiling, and of
juts out. This is
the size of thirty centimeters square,
done in order to
and, in every case, with an iron
prevent the
grating imbedded in the wall and with
neighbor from
a wire screen.
invading his
Nevertheless, the owner of the
property.
tenement or property adjoining the
iii. The entire wall is built
wall in which the openings are made
within the boundary of 1
can close them should he acquire
of the estates (not along
part-ownership thereof, if there be no
the boundary of the 2
stipulation to the contrary.
estates)
He can also obstruct them by
iv. When the wall supports
constructing a building on his land or
the building of 1 estate
by raising a wall thereon contiguous
but not the other
to that having such openings, unless
v. When the dividing wall
an easement of light has been
between the courtyards,
acquired.
gardens, and tenements
is constructed in such a
Art. 670. No windows,
way that the coping
apertures, balconies, or other similar
sheds the water upon
projections which afford a direct view
only 1 of the estates
upon or towards an adjoining land or
vi. Stepping stones only on
tenement can be made, without
1 side of the wall
leaving a distance of two meters

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Professor Ruben F. Balane Page 138 of 241
 between the wall in which they are of the servient estate to block
made and such contiguous property. the view.
Neither can side or oblique The easement of view
views upon or towards such necessarily carries with it the
conterminous property be had, unless easement of light.
there be a distance of sixty Direct View: There must be a
centimeters. minimum distance of 2 meters
The nonobservance of these from the wall of the opening and
distances does not give rise to the contiguous property.
prescription. Oblique View: There must be a
minimum distance of 60
Art. 671. The distance referred centimeters from the wall of the
to in the preceding article shall be opening and the contiguous
measured in cases of direct views property.
from the outer line of the wall when Non-observance of the
the openings do not project, from the minimum distances will not
outer line of the latter when they do, create an easement.
and in cases of oblique view from the The owner of the servient estate
dividing line between the two cannot build within 3 meters
properties. from the boundary between the
servient and the dominant
Art. 672. The provisions of estate. Thus, there is 5 meters
article 670 are not applicable to between the wall of the opening
buildings separated by a public way or and any structure of the servient
alley, which is not less than three estate.
meters wide, subject to special
The obligation not to build
regulations and local ordinances.
higher accompanies the
easements of light and view.
Art. 673. Whenever by any title
Acquiring by Prescription
a right has been acquired to have
a. Start counting from the 1st act
direct views, balconies or belvederes
constituting the exercise of the
overlooking an adjoining property,
easement was performed if the
the owner of the servient estate
opening through which the light and
cannot build thereon at less than a
view passes is a party wall.
distance of three meters to be
measured in the manner provided in Rationale: If the neighbor
article 671. Any stipulation permitting does not like the opening, he
distances less than those prescribed in can always close it.
article 670 is void. b. Start counting from the time when
the owner of the dominant estate
serves a notarial prohibition on the
2 Different Easements
owner of the prospective servient
1. Easement of light (luminis)
estate if the opening is made on
The easement of light is the
the dominant owners own wall.
right to make an opening not
Rationale: The neighbor cannot
greater than 30 centimeters
close the opening since its
square and to receive light from
in the dominant owners
anothers tenement.
property.
The opening must be made on
the ceiling or if on the wall,
F. Other So-Called Legal Easements (Not
there must be an iron grating
Strictly Speaking Legal Easements)
(so you cant look out,
1. Drainage of buildings (Articles 674-676)
otherwise, it becomes an
easement of light and view).
Art. 674. The owner of a
No minimum distance required. building shall be obliged to construct
2. Easement of light and view (luminis its roof or covering in such manner
et prospectus) that the rain water shall fall on his
The easement of light and view own land or on a street or public
is the right to open windows and place, and not on the land of his
apertures and to bar the owner

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Professor Ruben F. Balane Page 139 of 241
 neighbor, even though the adjacent works, subject, in regard to the
land may belong to two or more manner thereof, to the conditions
persons, one of whom is the owner of prescribed by such regulations. These
the roof. Even if it should fall on his prohibitions cannot be altered or
own land, the owner shall be obliged renounced by stipulation on the part
to collect the water in such a way as of the adjoining proprietors.
not to cause damage to the adjacent In the absence of regulations,
land or tenement. such precautions shall be taken as
may be considered necessary, in order
Art. 675. The owner of a to avoid any damage to the
tenement or a piece of land, subject to neighboring lands or tenements.
the easement of receiving water
falling from roofs, may build in such Art. 679. No trees shall be
manner as to receive the water upon planted near a tenement or piece of
his own roof or give it another outlet land belonging to another except at
in accordance with local ordinances the distance authorized by the
or customs, and in such a way as not ordinances or customs of the place,
to cause any nuisance or damage and, in the absence thereof, at a
whatever to the dominant estate. distance of at least two meters from
the dividing line of the estates if tall
Art. 676. Whenever the yard or trees are planted and at a distance of
court of a house is surrounded by at least fifty centimeters if shrubs or
other houses, and it is not possible to small trees are planted.
give an outlet through the house itself Every landowner shall have the
to the rain water collected thereon, right to demand that trees hereafter
the establishment of an easement of planted at a shorter distance from his
drainage can be demanded, giving an land or tenement be uprooted.
outlet to the water at the point of the The provisions of this article
contiguous lands or tenements where also apply to trees which have grown
its egress may be easiest, and spontaneously.
establishing a conduit for the
drainage in such manner as to cause Art. 680. If the branches of
the least damage to the servient any tree should extend over a
estate, after payment of the property neighboring estate, tenement, garden
indemnity. or yard, the owner of the latter shall
have the right to demand that they be
This is not really an easement. Rather, cut off insofar as they may spread
it is a limitation of the right of over his property, and, if it be the
ownership. roots of a neighboring tree which
2. Intermediate distances (Articles 677- should penetrate into the land of
681) another, the latter may cut them off
himself within his property.
Art. 677. No constructions can
be built or plantings made near Art. 681. Fruits naturally
fortified places or fortresses without falling upon adjacent land belong to
compliance with the conditions the owner of said land.
required in special laws, ordinances,
and regulations relating thereto. Again, this is a limitation of ownership
and not an easement.
Art. 678. No person shall build This is basically zoning which can be
any aqueduct, well, sewer, furnace, modified by laws and ordinances.
forge, chimney, stable, depository of
corrosive substances, machinery, or 3. Easement against nuisances (Articles
factory which by reason of its nature 682-683)
or products is dangerous or noxious,
without observing the distances Art. 682. Every building or
prescribed by the regulations and piece of land is subject to the
customs of the place, and without easement which prohibits the
making the necessary protective proprietor or possessor from

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Professor Ruben F. Balane Page 140 of 241
 committing nuisance through noise, In subjacent support, the owner of the
jarring, offensive odor, smoke, heat, surface and the sub-surface are
dust, water, glare and other causes. different.
G. Voluntary Easements
Art. 683. Subject to zoning, One can create voluntary easements in favor
health, police and other laws and of another immovable or persons on ones
regulations, factories and shops may property.
be maintained provided the least In La Vista vs. CA, the easement of right of
possible annoyance is caused to the way was not a legal easement but was
neighborhood. created because of a contract. Since it was
created by a contract, the requisites for a
This is also a limitation of ownership right of way under Arts. 649 and 650 need
and not an easement. not be followed.
Nuisance is any act, omission,
establishment, condition, property or DIFFERENT MODES OF ACQUIRING
anything else which (Article 694): OWNERSHIP
a. Injures or endangers the health or
safety of others; or Mode is the specific cause which gives rise to
b. Annoys or offends the senses; or ownership, as the result of the presence of a special
c. Shocks, defies or disregards decency condition of things, of the aptitude and intent of
or morality; or persons, and of compliance with the conditions
d. Obstructs or interferes with the free established by law.
passage of any public highway or Title is that which gives juridical justification for a
streets, or any body of water; or mode because it produces the cause for the
e. Hinders or impairs the use of acquisition of ownership.
property. Modes arise from title.
4. Lateral and subjacent support (Articles In a contract of sale, the ownership is transferred not
684-687) because of the contract of sale but by tradition
(delivery).
Sec. 684. No proprietor shall
The modern trend however is to do away with the
make such excavations upon his land
distinction between mode and title.
as to deprive any adjacent land or
I. 3 Types of Modes
building of sufficient lateral or
1. Original Mode
subjacent support.
In an original mode, ownership is not
acquired from an immediately preceding
Art. 685. Any stipulation or
owner. It does not however mean that the
testamentary provision allowing
object was not owned before. For example,
excavations that cause danger to an
if someone catches fish, it does not
adjacent land or building shall be
necessarily mean that person was the first
void.
one to catch it (occupation).
Art. 686. The legal easement of Intellectual creation, occupation
lateral and subjacent support is not 2. Derivative Mode
only for buildings standing at the time In a derivative mode, ownership is based on
the excavations are made but also for a right previously held by another person.
constructions that may be erected. Law, tradition, donation, succession
3. Mixed Mode
Art. 687. Any proprietor A 3rd mode was created since prescription
intending to make any excavation could not be classified as original or
contemplated in the three preceding derivative.
articles shall notify all owners of Prescription
adjacent lands. II. Modes of Acquiring Ownership
A. Intellectual creation
In lateral support, there is an obligation Intellectual creation is now governed by the
to see to it that the structures on your Intellectual Property Code and the TRIPS
neighbors land will not collapse from Agreement.
your lands lack of support.
B. Occupation

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Professor Ruben F. Balane Page 141 of 241
 For occupation to occur, the object must be Article 719 provides the procedure when
appropriable by nature (Article 713*). one finds a lost movable which is not a
Occupation regarding animals happens by treasure.
hunting or fishing. The acquisition of
animals can be regulated by law (i.e. C. Law
dynamite fishing). Proximately, law is 1 of the 7 modes of
The ownership of a piece of land cannot be acquiring ownership.
acquired by occupation (Article 714). This is Ultimately, law is the only source of
based on the Regalian Doctrine. Under the ownership.
Regalian doctrine, one cannot acquire land The provisions regarding law as a mode of
unless it was granted by the State or by its acquiring ownership is scattered throughout
prior owner. the Civil Code (i.e. Articles 681, 1434,
Under the Regalian Doctrine, there is no 1456).
such thing as land which is res nullius.
If the state grants the land to X. X abandons D. Tradition (Articles 1496-1501)
the land. What happens to the land? There
is no specific provision. Paras thinks that Art. 1496. The ownership of the
the land goes back to the state. thing sold is acquired by the vendee from
Under Article 716, the periods of 2 (for the moment it is delivered to him in any
bees) and 20 days (for domesticated of the ways specified in articles 1497 to
animals) are not periods of prescription. 1501, or in any other manner signifying
Rather, these days are conditions for the an agreement that the possession is
acquisition by occupation transferred from the vendor to the
There is a difference between domesticated vendee.
animals and domestic animals.
Domesticated animals are by nature wild Art. 1497. The thing sold shall be
animals but have been tamed possess the understood as delivered, when it is placed
habit of returning to the premises of the
possessor (Article 560). On the other hand, If the possessor of a movable lost or which the
a domestic animal is treated like any other owner has been unlawfully deprived, has acquired it in
good faith at a public sale, the owner cannot obtain its
personal property. It cannot be acquired by
return without reimbursing the price paid therefor.
the occupation since it is owned unless the
owner abandons the animal. Art. 719. Whoever finds a movable, which is not
Domestic animals are governed by Article treasure, must return it to its previous possessor. If
the latter is unknown, the finder shall immediately
559.
deposit it with the mayor of the city or municipality
*
where the finding has taken place.
Art. 713. Things appropriable by nature which are The finding shall be publicly announced by the
without an owner, such as animals that are the object mayor for two consecutive weeks in the way he deems
of hunting and fishing, hidden treasure and abandoned best.
movables, are acquired by occupation. If the movable cannot be kept without

Art. 716. The owner of a swarm of bees shall have a deterioration, or without expenses which considerably
right to pursue them to another's land, indemnifying diminish its value, it shall be sold at public auction
the possessor of the latter for the damage. If the eight days after the publication.
owner has not pursued the swarm, or ceases to do so Six months from the publication having elapsed
within two consecutive days, the possessor of the land without the owner having appeared, the thing found,
may occupy or retain the same. The owner of or its value, shall be awarded to the finder. The finder
domesticated animals may also claim them within and the owner shall be obliged, as the case may be, to
twenty days to be counted from their occupation by reimburse the expenses.
another person. This period having expired, they shall
Art. 681. Fruits naturally falling upon adjacent land
pertain to him who has caught and kept them. belong to the owner of said land.

Art. 560. Wild animals are possessed only while Art. 1434. When a person who is not the
they are under one's control; domesticated or tamed owner of a thing sells or alienates and delivers it, and
animals are considered domestic or tame if they retain later the seller or grantor acquires title thereto, such
the habit of returning to the premises of the possessor. title passes by operation of law to the buyer or

Art. 559. The possession of movable property grantee.

acquired in good faith is equivalent to a title. Art. 1456. If property is acquired through
Nevertheless, one who has lost any movable or has mistake or fraud, the person obtaining it is, by force of
been unlawfully deprived thereof may recover it from law, considered a trustee of an implied trust for the
the person in possession of the same. benefit of the person from whom the property comes.

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Professor Ruben F. Balane Page 142 of 241
 in the control and possession of the In Aviles vs. Arcega, a very
vendee. controversial decision, the
Alcantara sold the house to
Art. 1498. When the sale is made Aviles as evidenced by a
through a public instrument, the document acknowledged before
execution thereof shall be equivalent to a notary public. The document
the delivery of the thing which is the stated that Alcantara would
object of the contract, if from the deed the continue to possess the house
contrary does not appear or cannot for 4 months. Aviles never took
clearly be inferred. possession of the property even
With regard to movable property, after the lapse of 4 months.
its delivery may also be made by the Alcantara sold the house to
delivery of the keys of the place or Arcega. The SC said that Aviles
depository where it is stored or kept. cannot invoke symbolic delivery
as this was prevented by express
Art. 1499. The delivery of movable stipulation that Alcantara
property may likewise be made by the would continue in possession.
mere consent or agreement of the The fact that 4 months had
contracting parties, if the thing sold lapsed does not mean that there
cannot be transferred to the possession of was symbolic delivery since
the vendee at the time of the sale, or if the there is no law providing that is
latter already had it in his possession for should take place after the
any other reason. execution of the document
where there is stipulation to the
Art. 1500. There may also be contrary.
tradition constitutum possessorium. This case is controversial since
those who dissented are the 4
Art. 1501. With respect to civil law experts.
incorporeal property, the provisions of Traditio clarium is part of
the first paragraph of article 1498 shall tradicion simbolica. Traditio
govern. In any other case wherein said clarium is applicable only to
provisions are not applicable, the placing personal property (i.e. keys). In
of the titles of ownership in the Banco Filipino vs. Peterson, the
possession of the vendee or the use by the goods in the warehouse were
vendee of his rights, with the vendor's delivered when the keys to the
consent, shall be understood as a warehouse were given.
delivery. b. Longa manu (Articles 1496 and
1499, 1st part)
Tradition comes from the latin word tradere Longa manu means long hand.
which means to deliver. Literally this means hat the
Tradition is a mode of acquiring ownership transfer of ownership is done by
as a consequence of certain contracts such as pointing out. For example, the
sale by virtue of which, actually or ownership of the car is
constructively, the object is placed in the transferred by pointing to the
control and possession of the transferee. specific car.
Kinds of Tradition In longa manu, mere agreement
1. Real or material physical delivery is not enough. There must be an
(Article 1497) accompanying sign or gesture
2. Fingida constructive (Article 1499).
a. Simbolica (Article 1498) c. Brevi manu (Article 1499)
Requisites Brevi manu means short hand.
i. Transferor must have Brevi manu occurs when the
control of the thing transferee was already in
The transferor must possession before he had
have actual possession acquired ownership. For
ii. Transferee must be put in example, the lessee is renting
control the house. The lessor sells the
iii. There must be intent to house to the lessee.
transfer

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 d. Constitutum possessorium The donation is made on
(Article 1500) account of the donees merits.
Constitutum possessorium is For example, a parcel of land is
the opposite of brevi manu. In given to L since L is the most
this case, the transferor already outstanding student in law or
in possession and continues to out of gratitude for saving
be in possession under a another persons life.
different capacity after iii. Conditional or modal (Articles 726,
ownership had been transferred. 733)
For example, A owns a house. A A conditional or modal donation
sells the house to B. A then imposes upon the donee a
leases the house to B. burden which is less than the
3. Quasi-tradition (cuasi tradicion) value of the thing donated.
Quasi-tradition refers to the delivery For example, X donates land
of incorporeal property. worth P20,000,000. However,
For example, shares of stock cannot X must support the donors
be physically transferred. What is mother P2,000,000. The
delivered are the stock certificates. value of the donation is
The endorsement of the stock P18,000,000.
certificate is delivery by quasi- The more accurate term is not
tradition. conditional but modal.
However, in Tablante vs. Aquino, Modal donations are not pure
the SC applied quasi-tradition to acts of liberality since a mode is
tangible property. According to imposed.
Professor Balane, this is wrong. It Article 733 is inaccurate. Article
should be tradicion simbolica. 733 mentions remuneratory
4. By operation of law (por ministerio donations. This should be
de la ley) replaced by the word modal.
Succession should not be included iv. Onerous (Article 733)
here since succession is an This is a donation in name only.
independent mode of acquiring An onerous donation is a
ownership. It is not part of contradiction in terms.
tradition. b. Mortis causa - the effectivity of the
E. Donation donation depends upon the donors
Donation is an act of liberality whereby a death
person disposes gratuitously of a thing or The provisions on donation mortis
right in favor of another, who accepts it causa are dead letter because
(Article 725). donations mortis causa are
According to Professor Balane, the definition governed by the provisions of
of a donation in Article 725 is wrong. A testamentary succession which is
donation is not an act. It is a contract. another mode of acquiring
1. Features of donation ownership.
a. Reduction of the donors patrimony A donates to B a parcel of land on
b. Enhancement or increase of the donees the condition that B passes the Bar
patrimony of 2001. On the eve of the bar exam,
c. Animus donandi -- intent to do an act A dies. B passes the bar months
of liberality after the death of A. This is a
2. Classification of donations
a. Inter vivos the effectivity of the
Art. 726. When a person gives to another a thing or
donation does not depend upon the right on account of the latter's merits or of the services
donors death rendered by him to the donor, provided they do not
i. Pure or simple (Article 725) constitute a demandable debt, or when the gift
Gratuitous imposes upon the donee a burden which is less than
ii. Remuneratory (Article 726) the value of the thing given, there is also a donation.

Art. 733. Donations with an onerous cause shall
be governed by the rules on contracts and

Art. 725. Donation is an act of liberality whereby a remuneratory donations by the provisions of the
person disposes gratuitously of a thing or right in favor present Title as regards that portion which exceeds the
of another, who accepts it. value of the burden imposed.

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Professor Ruben F. Balane Page 144 of 241
 donation inter vivos since the cause If the acceptance is made in
for the donation is passing the bar. a separate instrument, the donor
The test to determine whether or shall be notified thereof in an
not it is inter vivos or mortis causa authentic form, and this step shall
is the causal connection. be noted in both instruments.

3. Form required The donation must be in a public

Form determines the validity of the instrument.
donation. Donations are one of the few The acceptance must either be in the
transactions left in which form same public instrument or in a
determines validity. Most transactions different public instrument.
are consensual, the intent determining Acceptance shall not take effect
validity. unless it is done during the lifetime
a. Movables (Article 748) of the donor.
If the acceptance is made in a
Art. 748. The donation of a separate public instrument, the
movable may be made orally or in donor shall be notified thereof in an
writing. authentic form, and this step shall
An oral donation requires be noted in both instruments.
the simultaneous delivery of the 4. Distinction between inter vivos and
thing or of the document mortis causa
representing the right donated. A donation mortis causa is always
If the value of the personal revocable. Thus, if the donation is
property donated exceeds five designated as irrevocable or is revocable
thousand pesos, the donation and only for certain grounds or causes, then
the acceptance shall be made in the donation is inter vivos.
writing, otherwise, the donation In a donation inter vivos, the property
shall be void. passes from the donor to the donee
(ownership). If the donor reserves the
If the donation is worth P5,000 or right of ownership, then the donation is
less, the donation can be made mortis causa.
orally. However, the oral donation A stipulation giving the donor the
must be accompanied by the power to alienate the property if the
simultaneous delivery of the donor needs money donation
movable or of the document inter vivos. In this case, the right to
representing the right donated. alienate is limited.
Without delivery, the donation is no NOTE: The reservation must pertain to
good. a reservation of the ownership and NOT
If the value of the donation exceeds the fruits.
P5,000, the donation and the If the donor reserves the power to
acceptance must be in writing. alienate, then the donor reserves the
The writing may be in a public or in right of ownership. It is a donation
a private instrument. mortis causa. If the donor reserves the
right to alienate only for certain grounds
b. Immovables (Article 749) and causes, then it means that the donor
has practically lost the right to alienate
Art. 749. In order that the it. Which means, the donor has
donation of an immovable may be practically lost his right of ownership.
valid, it must be made in a public This is a donation inter vivos.
document, specifying therein the A stipulation stating that the donee
property donated and the value of cannot alienate without the donors
the charges which the donee must consent donation mortis causa. In
satisfy. this case, the donor effectively has the
The acceptance may be power to alienate. The donee will always
made in the same deed of donation needs the consent of the donor.
or in a separate public document, 5. Limitations
but it shall not take effect unless it a. Who may Donate
is done during the lifetime of the
donor.

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Professor Ruben F. Balane Page 145 of 241
 A donor must have capacity to act Aggravating circumstance of
(i.e. age of majority, no civil price, promise or reward
interdiction or other incapacity, etc.) iii. Those made to a public officer
Article 735. or his wife, descendants and
ascendants, by reason of his
Art. 735. All persons office (Article 739 (3))
who may contract and dispose iv. Donations made by guardians
of their property may make a and trustees of property
donation. entrusted to them (Article 736)
In Araneta vs. Perez, the
The donor must have capacity at the owner of the land had a
time the donation is made. trustee. The land was being
The donation is perfected from the developed into a
moment the donor knows of the subdivision. The trustee
acceptance by the donee (Article donated with the courts
734) cognition theory consent to the LGU a
portion of the land to be
Art. 734. The donation used as a street. The
is perfected from the moment donation to the LGU was
the donor knows of the being challenged on the
acceptance by the donee. basis of Article 736. The SC
said that Article 736
Under the cognition theory, the contemplates donations
contract is perfected upon the which are pure. In this case,
donors learning of the donees the donation to the LGU
acceptance. It is not perfected when was not a pure donation.
the donee simply manifests his The donation was necessary
acceptance the manifestation to develop the subdivision.
theory. Knowledge by the donor is d. The donation should not be inofficious
crucial. e. The donation should not prejudice
In order for the donation to be creditors
perfected, the donor must have f. The donation should not impair support
knowledge of the donees for the donor and his family
acceptance. Thus, the donor must g. Donations cannot comprehend future
be alive and must have capacity at property (Article 751)
the time he learns of the donees
acceptance. Art. 751. Donations cannot
b. Who may be a Donee comprehend future property.
All those who are not specifically By future property is
disqualified by law may accept understood anything which the
donations (Article 738). donor cannot dispose of at the
c. Void Donations time of the donation.
The following are void donations:
i. Those made between persons 6. Reduction and revocation
who were guilty of adultery or a. The donation should not be
concubinage at the time of the inofficious (Article 752)
donation (Article 739 (1))
Art. 752. The provisions of
Conviction is not necessary.
article 750 notwithstanding, no
The donation shall not be person may give or receive, by way
void if the donee did not
of donation, more than he may
know of the donors existing give or receive by will.
marriage.
The donation shall be
ii. Those made between persons inofficious in all that it may exceed
found guilty of the same
this limitation.
criminal offense, in
consideration thereof (Article
A donation is inofficious if it impairs
739 (2))
the legitime.

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Professor Ruben F. Balane Page 146 of 241
 An inofficious donation will be donation shall prescribe after 4
reduced in so far as it exceeds what years from the birth of the child, or
the donor could have given by will to from his legitimation, recognition or
the donee the free portion. adoption or from the judicial decree
Whether a donation is inofficious or of filiation, or from the time the
not can only be determined at the information was received regarding
time of the death of the donor. the existence of the child believed
The heirs of the donor have 10 years dead. This action cannot be
from the death of the donor to renounced, and is transmitted upon
revoke or reduce the donation the death of the donor, to his
(Imperial vs. CA). legitimate and illegitimate children
If there is a subsequent appearance and descendants (Article 763).
or birth of a child and his legitime is b. The donation should not prejudice
impaired because of a donation, the creditors (Article 759)
donation may be revoked or reduced
to the extent that his legitime is Art. 759. There being no
prejudiced (Articles 760 and 761). stipulation regarding the payment
of debts, the donee shall be
Art. 760. Every responsible therefor only when
donation inter vivos, made by the donation has been made in
a person having no children or fraud of creditors.
descendants, legitimate or The donation is always
legitimated by subsequent presumed to be in fraud of
marriage, or illegitimate, may creditors, when at the time thereof
be revoked or reduced as the donor did not reserve
provided in the next article, by sufficient property to pay his debts
the happening of any of these prior to the donation.
events:
(1) If the donor, after the If the donor does not have enough
donation, should have properties reserved to pay off his
legitimate or creditors, the creditors have 4 years
legitimated or from the knowledge of the donation
illegitimate children, to rescind the donation accion
even though they be pauliana (Articles 1381 (3), 1387
posthumous; and 1389)
(2) If the child of the
donor, whom the
latter believed to be

dead when he made Art. 1381. The following contracts are rescissible:
the donation, should (3) Those undertaken in fraud of creditors when
turn out to be living; the latter cannot in any other manner collect
(3) If the donor the claims due them;
subsequently adopt a Art. 1387. All contracts by virtue of which the
minor child. debtor alienates property by gratuitous title are
presumed to have been entered into in fraud of
Art. 761. In the cases creditors, when the donor did not reserve sufficient
referred to in the preceding property to pay all debts contracted before the
article, the donation shall be donation.
revoked or reduced insofar as Alienations by onerous title are also presumed
it exceeds the portion that may fraudulent when made by persons against whom some
judgment has been issued. The decision or attachment
be freely disposed of by will,
need not refer to the property alienated, and need not
taking into account the whole
have been obtained by the party seeking the
estate of the donor at the time
rescission.
of the birth, appearance or
Art. 1389. The action to claim rescission must
adoption of a child. be commenced within four years.
For persons under guardianship and for
In the case of the subsequent absentees, the period of four years shall not begin until
appearance or birth of a child, the the termination of the former's incapacity, or until the
action to revoke or reduce the domicile of the latter is known.

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Professor Ruben F. Balane Page 147 of 241
 c. The donation must not impair the noncompliance to revoke the
support for the donor or his donations.
relatives (Article 750) The right of revocation may be
exercised against the donees heirs.
Art. 750. The donations Revocation is the only available
may comprehend all the present remedy in this situation. Reduction
property of the donor, or part is not applicable.
thereof, provided he reserves, in e. The donee must not act with
full ownership or in usufruct, ingratitude (Article 765)
sufficient means for the support of The following are acts of ingratitude
himself, and of all relatives who, at a. If the donee should commit
the time of the acceptance of the some offense against the person,
donation, are by law entitled to be the honor or the property of the
supported by the donor. Without donor, or of his wife or children
such reservation, the donation under his parental authority
shall be reduced in petition of any b. If the donee imputes to the
person affected. donor any criminal offense, or
any act involving moral
If the donor does not reserve turpitude, even though he
enough property for his and his should prove it, unless the crime
familys support, the donation can or the act has been committed
be reduced. against the donee himself, his
The donation can be reduced as wife or children under his
much as may be necessary. authority
In extreme cases, the donation can c. If he unduly refuses him
be revoked if the donor gave away so support when the donee is
much, and the donor and his family legally or morally bound to give
need everything back. support to the donor
The refusal by the donee
d. Donations must comply with the must be unjustifiable.
conditions of the donation (Article The fact that these acts were
764) committed will not give rise to the
revocation. The donor must invoke
Art. 764. The donation these grounds.
shall be revoked at the instance of The donor has 1 year from the time
the donor, when the donee fails to the donor acquires knowledge of the
comply with any of the conditions donees act of ingratitude to revoke
which the former imposed upon (Article 769).
the latter.
In this case, the property Art. 769. The action
donated shall be returned to the granted to the donor by reason
donor, the alienations made by the of ingratitude cannot be
donee and the mortgages imposed renounced in advance. This
thereon by him being void, with action prescribes within one
the limitations established, with year, to be counted from the
regard to third persons, by the time the donor had knowledge
Mortgage Law and the Land of the fact and it was possible
Registration laws. for him to bring the action.
This action shall prescribe
after four years from the F. Succession
noncompliance with the condition, G. Prescription
may be transmitted to the heirs of
the donor, and may be exercised III. Modes of Extinguishing Ownership
against the donee's heirs. A. Voluntary Modes
1. Abandonment
For failure to comply with the Rights such as ownership may be
conditions of the donation, the waived.
donor or his heirs have 4 years from

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Professor Ruben F. Balane Page 148 of 241
 Under Article 6, the waiver of ownership proceeds of which go to the creditor. The debtor then
need not follow any formalities. becomes a slave. If he is not bought, the creditor can
have him chopped into little pieces or have him sold to
Art. 6. Rights may be the barbarians.
waived, unless the waiver is As time passed, cruelty softened. By the time of
contrary to law, public order, Cicero, ligatio does not mean vinculum of chains but
public policy, morals, or good vinculum juris (bond of law). Obligation became
customs, or prejudicial to a third metaphorical and not literal.
person with a right recognized by
law. I. Obligations
A. Definition of Obligation
2. Alienation
a. Onerous title (i.e. sale) Art. 1156. An obligation is a juridical
b. Gratuitous title necessity to give, to do or not to do.
i. Inter vivos
ii. Mortis causa This provision is the soul of brevity. It was
3. Voluntary destruction (i.e. burning of borrowed from Sanchez Roman. However,
trash) many commentators say it is incomplete
B. Involuntary Modes because the obligation is only from the
1. Fortuitous loss or destruction (i.e. fire) point of view of the debtor. To make it
2. Accession continua (i.e. bad faith in complete, it must cover the points of view of
commixtion or confusion) both the debtor and creditor. Obligations
3. Rescissory actions are bilateral. It should include what can be
4. Judicial decree required, the remedy and the means by
Professor Balane does not think that which the creditor can take to pursue the
judicial decree should be enumerated as remedy.
an involuntary mode since the judicial An obligation is a juridical relation whereby
decree would be based on something a person should engage or refrain from
else. engaging in a certain activity for the
5. By operation of law (i.e. confiscate due to satisfaction of the private interest of another
police power) who, in the case of non-fulfillment of such
duty, may obtain from the patrimony of the
Obligations and Contracts former through proper judicial proceedings
the very prestation due or in default thereof,
Introduction the economic equivalent that it represents
Our Civil Code follows the Gaian order which is (Diaz Piero).
of three parts: Persons, Things and Obligations. An obligation is a juridical relation whereby
The title of Book IV of the Civil Code is a person (called a creditor) may demand
inaccurate. While the title is Obligations and from another (called the debtor) the
Contracts, it should only be Obligations since by observance of a determinate conduct, and, in
including Contracts in the title, it is putting the latter case of breach, may obtain satisfaction from
on equal footing with the former; but this is not correct the assets of the latter (Arias Ramos).
since contracts is only one of the sources of obligations. B. Characteristics of Obligations
Obligations is the most important, most abstract 1. It represents an exclusively private interest
and most difficult of all of civil law. It is the entirety of 2. It creates ties which are by nature transitory
private law. If you dont know obligations and contracts, Because obligations are extinguished.
you will never understand commercial law. But the period is relative could be
The term obligations was derived from the seconds (e.g., buying coke) and could be
words ob and ligare which means to bind or tie years (e.g., partnership, lease)
together. Ligare is the source of several common 3. It involves the power to make the juridical
words such as ligament and ligation. (Ligation and tie defective in case of non-fulfillment
Vasectomy have the same purpose: to tie and to cut off, through satisfaction of the debtors property
the fallopian tube, for the former, and the vas deferens, C. Trends in the Modern Law of Obligations
for the latter.) 1. Progressive spiritualization of the law
Obligatio was initially a physical act of being on obligations
chained (with shackles). Before, under Roman law, if the Before, obligations were very formal and
debtor cannot pay, the creditor can bring him to the ritualistic. If it was not in the proper
magistrate and the magistrate can authorize the creditor form, no obligations will assume. Now,
to cuff the debtor and offer him for sale for 3 days, the the emphasis is in the meeting of the

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Professor Ruben F. Balane Page 149 of 241
 minds, and not on the specific form. This is basically the principle in quasi-
There is even no need that it be in delicts. Now, in many cases, a person
writing, as a General Rule, since may be held liable even if not
consensuality is the prevailing doctrine. responsible.
As long as it can be manifest and any For example, under workmans
kind of manifestation will do it is compensation, the employer is liable to
sufficient. compensate the employee even if the
Roman Law was formalistic. Vestiges of employer was not negligent.
Roman Law in the Civil Code can be 5. The tendency of unity in modern
seen in the law governing donations, legislation
which is very formal. Even for sales, the This can be manifest in the rise of a
requirement of form is only for global village. This can be seen
enforceability and not for validity. This particularly in trade laws.
is to make it conducive to business and The tendency now is to make things
facilitate commercial transactions. uniform especially in commerce.
This is still an ongoing trend: e- Different rules would impede
commerce added another option in form commerce.
and proof of contracts (but this is not D. Essential Requisites of Obligations
applicable to all, usually only for 1. Active subject
business, not applicable to wills). The active subject is called a creditor if
the obligation is to give. The active
2. The principle of autonomy of will of subject is called an obligee if the
the parties is now subject to several obligation is to do.
restrictions The active subject is always a person
While the principle still operates, the whether juridical or natural.
exceptions (prohibited areas) have 2. Passive subject
grown larger and larger. The passive subject is called a debtor if
Article 1306 gives the five restrictions: the obligation is to give. The passive
not contrary to law, morals, good subject is called an obligor if the
customs, public order, or public policy. obligation is to do.
Those which are against these five The passive subject must be determinate
restrictions are void, as can be seen in or determinable
Article 1409*. However, now we have How can both subjects be determinate or
restrictions such as social justice, determinable?
environmental preservation, etc. This is a. Obligations where the subjects are
because of the rising tide of social completely and absolutely determined at
discontent, hence social legislation came the birth of an obligation.
to be for the underprivileged.
If A and B are parties to a contract
of sale and B doesnt comply. A
3. The mitigation of the principle that
cannot sue C.
the debtor should answer with all his
b. Obligations where one subject is
property
determined at the moment of the birth
Before, the debtor had to answer his of the obligation and the other subject is
debts with all his property. Now, certain to be determined subsequently at some
properties are exempt and these can be fixed criterion, which criterion is fixed at
found in substantive law (i.e., home) the start of the obligation.
and in procedural law (i.e. support, etc.)
B makes a promissory note payable
Also, the debtor may not be imprisoned to M or order. In this case, the
for non-payment of debts. creditor is not necessarily M. The
The theory is to leave the debtor creditor is either M or to whomever
something to live decently by. the promissory note is endorsed.
4. The weakening of the principle that At the time of the birth of the
liability arises from responsibility obligation, the payee is not yet
* known but the obligation is valid.
Art. 1409. The following contracts are inexistent and c. Obligations in which subjects are
void from the beginning: determined in accordance with its
(1) Those whose cause, object or purpose is relation to a thing.
contrary to law, morals, good customs, public
The real rights
order or public policy;

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Professor Ruben F. Balane Page 150 of 241
 A mortgaged property to X pursuant The vinculum juris is the legal tie. It
to a loan. The mortgage attaches to consists of the enforceability of the
the property. If A sells the property obligation. If the debtor does not
to B, the annotation in the TCT will conform, the creditor has the power to
follow and B becomes the go to court to make the debtor perform
mortgagor. If A doesnt pay, X goes coercive.
against B. What makes an obligation is the power
The obligor in this case is whoever of the creditor to haul the debtor before
owns the land. X doesnt care the court, summoning powers of the
whether its A or B. state if needed.
3. Object of the obligation Voluntariness goes into entering into an
The object of the obligation always obligation. But once you enter, it
consists in an activity or conduct to be becomes involuntary.
observed by the debtor towards the 5. Causa
creditor. This conduct to be observed is Castan adds a 5th essential requisite
also known as the prestation. causa. Also known as causa debendi or
In a contract of sale for example, the causa obligationes. Causa means the
object of the obligation is the conduct of why of an obligation.
the vendor in delivering the car. The The object of an obligation answers the
car, on the other hand, is the object of question What is owed? (Quid). The
the prestation. causa answers the question Why is it
obligation owed? (Cur).
For example, A will deliver a car to B
since A expects to get P300,000. The
P300,000 is the causa of the obligation.
prestation (object of the obligation) deliver
6. Form the car
Another commentators say that the 6th
essential requisite is form. Form means
Sometimes, the commentators confuse some manifestation of intent. In some
car (object of the prestation)
the car as the object of the obligation, cases the manifestation is specific such
but this is wrong. The object is not the as in the case of donations.
car but the prestation. According to Professor Balane that the
According to Professor Balane, the general rule is that there is no specific
distinction between the object of the form for a valid obligation. However, if
obligation and the object of the form means that there is some external
prestation has been blurred by Articles manifestation, fine, since we are not
1347-1349. telepathic after all. However, there
Requisites of the Object of the should still be no specific form.
Obligation
a. Licit (Legal) E. Sources of Obligations (Article 1157)
Example: Cant validly enter
into a contract for sexual Art. 1157. Obligations arise from:
services (1) Law;
b. Possible both in fact and in law (2) Contracts;
Determined by the rules of (3) Quasi-contracts;
experience (4) Acts or omissions punished by
c. Determinate or determinable law; and
Cant say that I promise to sell (5) Quasi-delicts.
you something.
Example of determinate: I There is really only one source of obligations
promise to sell you my car. just law. Without the law saying that a
Example of determinable: I particular contract is enforceable, the
promise to sell you my riceland contract will not give rise to an obligation.
in Bicol in November (will However, source can be understood in
become determinate when time both the ultimate and immediate sense. In
comes). the ultimate sense, law is the solitary source.
d. Must have pecuniary value In the immediate sense, there are 5, those
4. Vinculum juris enumerated in Article 1157. Law is therefore

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Professor Ruben F. Balane Page 151 of 241
 both an immediate and ultimate source. This provision combines two concepts of
Examples of law being an immediate source Roman law equity or good faith (ius
are payment of taxes and accession. gentium) and strict compliance by the
Is this enumeration of the sources of parties (ius chinile).
obligation exclusive? The Supreme Court in A contract is a meeting of minds
the case of Sagrada Orden vs. NACOCO between 2 persons whereby one binds
seem to answer it in the affirmative. himself, with respect to the other, to give
However, this is only by implication or something or to render some service
indication. The Court did not make an (Article 1305)
explicit statement that it is. Contractual obligations have the force of
Many commentators including Professor law between the contracting parties and
Balane believe that the list is not exclusive. should be complied with in good faith
They criticize the case because it is not a (Article 1159).
good way of enumerating. At present, there The contracting parties may establish
is one more possible source of obligations such stipulations, clauses, terms and
public offer. conditions as they may deem
Example: In commercials, there is an offer convenient, provided they are not
to replace 30 sachets of Tide for one contrary to law, morals, good customs,
Venetian-cut glass until the end of the year. public order, or public policy (Article
There is no contract or quasi-contract. But if 1306).
before the end of the year, you present your Contracts are perfected by mere
Tide sachets, you can demand for your glass. consent, and from that moment the
Public offer is in fact a source of obligation parties are bound not only to the
under the BGB (the German Civil Code), fulfillment of what has been expressly
Article 657 which provides that a person stipulated but also to all the
who by public notice announces a reward in consequences which, according to their
the performance of the act is liable even if nature, may be in keeping with good
such person did not act in view of such faith, usage and law (Article 1315).
reward. In case of doubt, the interpretation
Although public officers are supplemented consistent with good faith is followed
by DTI regulations, Professor Balane thinks (Peoples Car vs. Commando Security).
that public offer should be made part of the Party cannot excuse themselves on the
law since regulations easily change. ground that it has become unprofitable.
1. Law (Article 1158) Law will not protect you from your own
bad judgment.
Art. 1158. Obligations derived
from law are not presumed. Only 3. Quasi-contract (Article 1160)
those expressly determined in this
Code or in special laws are Art. 1160. Obligations derived
demandable, and shall be regulated by from quasi-contracts shall be subject
the precepts of the law which to the provisions of Chapter 1, Title
establishes them; and as to what has XVII, of this Book.
not been foreseen, by the provisions
of this Book. 4. Delict (Article 1161)

There is only 1 ultimate source of Art. 1161. Civil obligations

obligations law. However, there are 5 arising from criminal offenses shall
proximate sources of obligations (Article be governed by the penal laws, subject
1157). to the provisions of article 2177, and of
the pertinent provisions of Chapter 2,
2. Contract (Article 1159) Preliminary Title, on Human
Relations, and of Title XVIII of this
Art. 1159. Obligations arising Book, regulating damages.
from contracts have the force of law
between the contracting parties and General Rule: If you commit a crime,
should be complied with in good faith. you are liable both criminally and civilly.
Exception: No private offended party
Contract is only 1 of the sources of (e.g. contempt, etc.)
obligations.

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Professor Ruben F. Balane Page 152 of 241
 The Civil Code deals with the civil aspect responsible for the acts of his son and is
(i.e. indemnification for loss of earning therefore responsible for the negligence
capacity). of the minor. Here, it is clear that
breach of contract and quasi-delict are
5. Quasi-delict (Article 1162) separate.
However, they can overlap as can be
Art. 1162. Obligations derived seen in the following example: Bus
from quasi-delicts shall be governed driver drives recklessly and the bus hits
by the provisions of Chapter 2, Title a tree. A passenger is injured. The
XVII of this Book, and by special laws. passenger and sue the driver for quasi-
delict (due to negligence) or for crime or
Quasi-delict is a civil law term while tort the bus company for breach of contract
is a common law term. of carriage or for quasi-delict
Difference between Contractual Liability (negligence in the selection and
and Quasi-Delict supervision).
In quasi-delict, the obligation arises The cause of action one chooses
only when there is a violation. determines the:
Without violation, there is no 1. Parties involved
obligation. It is the breach itself 2. Degree of proof
which gives rise to the obligation. 3. Defenses
In contracts, there is already an One can tailor his suit depending on the
obligation which exists prior to or cause of action he chooses.
even without a breach. The breach
of the contract is immaterial to the F. Nature and Effect of Obligations
legal obligation. 1. Kinds of Prestations
a. To give (Articles 1163-1166)
Example: Contract of sale of watch.
If both parties perform their
Art. 1163. Every person
obligation, the contract is
obliged to give something is also
extinguished. There is no breach,
obliged to take care of it with the
but there is an obligation.
proper diligence of a good father
(Compare the above example with
of a family, unless the law or the
the one below)
stipulation of the parties requires
Example: Driving recklessly, A hits
another standard of care.
a child. When did the obligation
came to being? When there was
Art. 1164. The creditor has
injury due to negligence.
a right to the fruits of the thing
(Negligence per se does not give rise
from the time the obligation to
to a quasi-delict unless there is
deliver it arises. However, he shall
injury.)
acquire no real right over it until
Breach and quasi-delict are
the same has been delivered to
inseparable. But contract and
him.
breach may be separable.
Question: Are contracts and quasi- Art. 1165. When what is to
delicts mutually exclusive?
be delivered is a determinate
Answer: No. thing, the creditor, in addition to
In Gutierrez vs. Gutierrez, there was a
the right granted him by article
collision between a bus and a car and a 1170, may compel the debtor to
passenger of the bus was injured. It was
make the delivery.
proven that the driver of the car was a If the thing is
minor and an incompetent driver. The
indeterminate or generic, he may
passenger sued against them all. The ask that the obligation be complied
Supreme Court held that the bus driver,
with at the expense of the debtor.
bus owner and the driver of the car If the obligor delays, or has
(through his father) are jointly and
promised to deliver the same thing
severally liable to the passenger. The to two or more persons who do not
liability of the owner of the bus and the
have the same interest, he shall be
bus driver rests on that of a contract. responsible for any fortuitous
On the other hand, the father is

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Professor Ruben F. Balane Page 153 of 241
 event until he has effected the against C, because Bs
delivery. right over the fruits is
only personal. Bs
Art. 1166. The obligation to remedy is to go against
give a determinate thing includes A for the value of the
that of delivering all its accessions fruits.
and accessories, even though they 3. To deliver the accessions
may not have been mentioned. and accessories (Article
1166)
i. To give a determinate thing Dont take accession in
Primary Obligation: Giving the technical sense (or
what is supposed to be given. else, it might overlap
3 Accessory Obligations: with ii). Understand it
1. After constitution of the to mean things that go
obligation and before with the thing to be
delivery, to take care of it delivered (i.e. radio of
with the proper diligence of the car).
a good father of the family Remedies Available to the
(Article 1163) Creditor
General Rule: 1. Specific performance the
Diligence of a good debtor must perform it
father of the family personally
Exception: Law or 2. Equivalent performance
stipulation requires damages
different standard of Damages may be
care obtained exclusively or
If through negligence, in addition to the 1st
something causes the action.
thing damage, the Rules regarding Improvement,
debtor is liable for Loss or Deterioration (Articles
damages. 1189, 1190, 1194 )
This is not applicable to
a generic thing. Art. 1189. When the
2. To account and deliver to conditions have been
the creditor the fruits if the imposed with the intention
thing bears fruits upon the of suspending the efficacy
time the obligation to of an obligation to give, the
deliver it arises (Article following rules shall be
1164). observed in case of the
However, ownership is improvement, loss or
transferred only by deterioration of the thing
delivery. Hence, during the pendency of the
creditors right over the condition:
fruits is merely (1) If the thing is lost
personal. without the fault of
Example: A sold B a the debtor, the
mango plantation to be obligation shall be
delivered on January 1. extinguished;
Come January 1, A did (2) If the thing is lost
not deliver. A instead through the fault
sold the fruits to C, a of the debtor, he
buyer in good faith. B shall be obliged to
sues A for specific pay damages; it is
performance. Court understood that
awards the plantation to the thing is lost
B. Does B have a right when it perishes,
to the fruits? Yes, as or goes out of
against A. No, as commerce, or
disappears in such

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Professor Ruben F. Balane Page 154 of 241
 a way that its do, the provisions of the
existence is second paragraph of article
unknown or it 1187 shall be observed as
cannot be regards the effect of the
recovered; extinguishment of the
(3) When the thing obligation.
deteriorates
without the fault of Art. 1194. In case of
the debtor, the loss, deterioration or
impairment is to improvement of the thing
be borne by the before the arrival of the day
creditor; certain, the rules in article
(4) If it deteriorates 1189 shall be observed.
through the fault
of the debtor, the 1. Requisites
creditor may a. Obligation has a
choose between suspensive condition, a
the rescission of resolutory condition or
the obligation and term
its fulfillment, b. The obligor is obligated
with indemnity for to deliver a determinate
damages in either thing
case; c. There is improvement,
(5) If the thing is loss or deterioration
improved by its before the fulfillment of
nature, or by time, the condition or the
the improvement period
shall inure to the d. The condition is fulfilled
benefit of the or the period arrives
creditor; 2. Rules Proper
(6) If it is improved at a. If the thing is lost
the expense of the without the fault of the
debtor, he shall debtor, the obligation is
have no other right extinguished
than that granted b. If the thing is lost
to the through the fault of the
usufructuary. debtor, he must pay
damages
Art. 1190. When the The thing is lost
conditions have for their when it perishes,
purpose the goes out of
extinguishment of an commerce or
obligation to give, the disappears in such a
parties, upon the way that its
fulfillment of said existence is
conditions, shall return to unknown or cannot
each other what they have be recovered.
received. c. If the thing deteriorates
In case of the loss, without the fault of the
deterioration or debtor, the creditor
improvement of the thing, must accept the thing in
the provisions which, with its impaired condition
respect to the debtor, are d. If the thing deteriorates
laid down in the preceding through the fault of the
article shall be applied to debtor, the creditor may
the party who is bound to choose between
return. i. Resolution (Article
As for the 1189) plus damages
obligations to do and not to

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Professor Ruben F. Balane Page 155 of 241
 ii. Fulfillment of the in addition to the 1st 2
obligation plus actions.
damages b. Not to do (Article 1168)
e. If the thing is improved
by nature or by time, Art. 1168. When the
the improvement obligation consists in not doing,
shall inure to the benefit and the obligor does what has
of the creditor been forbidden him, it shall also
f. If the thing is improved at be undone at his expense.
the expense of the debtor,
the debtor shall the same This includes the obligation not to
rights as a usufructuary give.
ii. To give a generic thing Remedies Available to the Creditor
Remedies Available to the i. Substitute performance - done
Creditor by someone else (perform at the
1. Specific performance the expense of the debtor)
debtor must perform it ii. Equivalent performance -
personally damages
2. Substitute performance Damages may be obtained
done by someone else exclusively or in addition to
(perform at the expense of the 1st 2 actions.
the debtor) Summary of the rules regarding
3. Equivalent performance remedies available to the creditor in
damages obligations to give, to do and not to do.
Damages may be Specific
obtained exclusively or Obligation Performance
in addition to the 1st 2 1. To give
actions. a. Determinate thing
c. To do (Article 1167) b. Determinable thing
2. To do
Art. 1167. If a person a. Very personal
obliged to do something fails to do
b. Not very personal
it, the same shall be executed at
3. Not to do
his cost.
This same rule shall be Specific performance is the performance
observed if he does it in of the prestation itself.
contravention of the tenor of the In obligations to do or not to do,
obligation. Furthermore, it may be specific performance is not available
decreed that what has been poorly since it will go against the
done be undone. constitutional prohibition against
involuntary servitude.
i. Only the obligor can do Equivalent performance is the payment
(personalisimo) of damages
Remedies Available to the Substitute performance is when
Creditor someone else performs or something
1. Equivalent performances else is performed at the expense of the
damages debtor.
ii. Anyone else can do it (not 2. Irregularity in Performance
personalisimo) a. Attributable to the Debtor
Remedies Available to the (culpable)
Creditor Article 1170 provides that those who
1. Substitute performance in the performance of their
done by someone else obligations are guilty of fraud,
(perform at the expense of negligence, or delay and those who
the debtor) in any manner contravene the tenor
2. Equivalent performance thereof, are liable for damages.
damages According to Professor Balane, the
Damages may be phrase who in any manner
obtained exclusively or contravene the tenor thereof is a

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Professor Ruben F. Balane Page 156 of 241
 catch-all provision. However, such In Article 1171, there was
is unnecessary. Nothing will escape already an obligation before the
fraud, negligence or delay. fraud exists. Malice is
i. Fraud (Articles 1170, 1171) subsequent fraud.
Example of fraud as deceit
Art. 1170. Those who in under Article 1338: A and B
the performance of their entered into a contract of sale of
obligations are guilty of fraud, a diamond necklace. However,
negligence, or delay, and those the necklace was really made of
who in any manner contravene glass. Fraud here is deceit.
the tenor thereof, are liable for There was vitiation of consent
damages. hence the contract is voidable.
Example of fraud as malice
Art. 1171. Responsibility under Article 1171. A and B
arising from fraud is entered into a contract. B will
demandable in all obligations. deliver furniture made of narra
Any waiver of an action for but B delivered one made of
future fraud is void. plywood. Fraud here is malice.
It will not affect the validity of
The problem with fraud is the the contract.
term. It is used in different Effects of Fraud (Articles 1170,
meanings in the Code. 1171)
Fraud may be defined as the 1. Creditor may insist on
voluntary execution of a proper substitute or specific
wrongful act, or willful performance (Article
omission, knowing and 1233); or
intending the effects which 2. Rescission/Resolution
naturally and necessarily arise (Article 1191)
from such act or omission. 3. Damages in either case
Fraud is the deliberate and (Article 1170)
intentional evasion of the ii. Negligence
normal fulfillment of the Negligence is the absence of due
obligation. It is distinguished diligence (Article 1173)
from negligence by the presence
of deliberate intent, which is Art. 1173. The fault or
lacking in the latter. (Legaspi negligence of the obligor
Oil vs. CA) consists in the omission of that
Fraud under Article 1170 is diligence which is required by
more properly called as malice. the nature of the obligation
Fraud under Article 1170 must
not be confused with fraud
Art. 1233. A debt shall not be understood to have
under Article 1338. Fraud
been paid unless the thing or service in which the
under Article 1338 is more obligation consists has been completely delivered or
properly called as deceit. rendered, as the case may be.
In Article 1338, fraud preexists
Art. 1191. The power to rescind obligations is
the obligation, thus the
implied in reciprocal ones, in case one of the obligors
obligation is voidable. Deceit
should not comply with what is incumbent upon him.
vitiates consent in contracts. The injured party may choose between the
Deceit is antecedent fraud. The fulfillment and the rescission of the obligation, with the
deceit occurs by using insidious payment of damages in either case. He may also seek
words machinations. Without rescission, even after he has chosen fulfillment, if the
this deceit, the other party latter should become impossible.
would not have entered into the The court shall decree the rescission claimed,
contract. unless there be just cause authorizing the fixing of a
period.

Art. 1338. There is fraud when, through insidious This is understood to be without prejudice to
words or machinations of one of the contracting the rights of third persons who have acquired the
parties, the other is induced to enter into a contract thing, in accordance with articles 1385 and 1388 and
which, without them, he would not have agreed to. the Mortgage Law.

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Professor Ruben F. Balane Page 157 of 241
 and corresponds with the standard of care is
circumstances of the persons, different. It is much
of the time and of the place. higher for the Pieta.
When negligence shows bad The diligence of a good
faith, the provisions of articles father of the family is
1171 and 2201, paragraph 2, the imaginary standard.
shall apply. Effects of Negligence (Articles
If the law or contract 1170, 1172)
does not state the diligence 1. Creditor may insist on
which is to be observed in the proper substitute or specific
performance, that which is performance (Article 1233);
expected of a good father of a or
family shall be required. 2. Rescission/Resolution
(Article 1191)
Art. 1172. 3. Damages in either case
Responsibility arising from (Article 1170)
negligence in the performance iii. Delay (Mora)
of every kind of obligation is
also demandable, but such Art. 1169. Those obliged
liability may be regulated by to deliver or to do something
the courts, according to the incur in delay from the time
circumstances. the obligee judicially or
extrajudicially demands from
Like fraud, negligence results in them the fulfillment of their
improper performance. But it is obligation.
characterized by lack of care, However, the demand
unlike fraud which is by the creditor shall not be
characterized by malice. necessary in order that delay
Lack of care means lack of due may exist:
diligence or the care of a good (1) When the obligation
father of the family (bonus or the law expressly so
paterfamilias) under Article declare; or
1163. (2) When from the nature
In English law, due diligence is and the circumstances
called the diligence of a prudent of the obligation it
businessman, since they are appears that the
more commerce-oriented. designation of the
2 Types of Negligence time when the thing is
1. Simple to be delivered or the
2. Gross service is to be
The determination of due rendered was a
diligence is always relative. It controlling motive for
will depend on the establishment of
1. The nature of the obligation the contract; or
2. Nature of the circumstances (3) When demand would
of be useless, as when
a. Person the obligor has
b. Time rendered it beyond his
c. Place power to perform.
Example: The diligence In reciprocal
required in shipping obligations, neither party
hinges is different from incurs in delay if the other does
the diligence required in not comply or is not ready to
shipping the Pieta de comply in a proper manner
Michaelangelo. The with what is incumbent upon
shipper must observe him. From the moment one of
the diligence of a good the parties fulfills his
father of the family in obligation, delay by the other
both cases but the begins.

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Professor Ruben F. Balane Page 158 of 241
 persona). Thus, no
Delay has nothing to do with demand, no delay.
quality but only with Exceptions: (mora
punctuality. solvendi ex re) Article
Delay is the non-fulfillment of 1169
the obligation with respect to a. When the obligation
time. In fraud and negligence, or the law expressly
the question is the quality even so declares
if performed on time. In delay, Mere setting of
even if the quality is excellent due date is not
but the performance is not in enough. This
due time, the debtor is liable. does not
Requisites of delay (SSS vs. constitute
Moonwalk) automatic
Obligation is demandable delay.
and liquidated There must be
Delay is through fault or an express
negligence stipulation to
Creditor requires the following
performance either effect: Non-
judicially (through court performance on
action) or extrajudicially that day is delay
(any communication by the without need of
creditor to debtor). demand. (Dela
In reciprocal obligations Rosa vs. BPI)
(obligations with a counterpart b. When it appears
prestation) which require from the nature and
simultaneous performance, circumstances of
demand is still needed. the obligation that
What is the form of such time was a
demand? Any controlling motive
communication of a party for the
that he is ready and willing establishment of the
to comply with his contract.
obligation. If after receipt Example: The
of demand and the other wedding gown
party does not comply with has to be ready
his obligation, he is in delay. before the
3 Kinds of Delay wedding.
1. Mora solvendi c. When demand
would be useless,
Delay in performance
when obligor has
incurred by the debtor.
rendered it beyond
Requisites: his power to
a. The obligation is
perform.
demandable and
Example: A
liquidated
sold the fruits
b. Debtor delays
of the mango
performance either
plantation he
because of dolo or
already sold to
culpa
B to C. B need
c. The creditor
not make a
demands the
demand on A to
performance either
deliver the
judicially or
fruits since
extrajudicially
demand would
General Rule:
be useless.
Demand is necessary.
Effects of Mora Solvedi
(mora solvendi ex

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Professor Ruben F. Balane Page 159 of 241
 a.When the obligation c.
Expenses incurred
is to deliver a by debtor for
determinate thing, preservation of
the risk is placed on thing after the delay
the part of the shall be chargeable
debtor (Article to creditor.
1165) d. If the obligation has
b. Damages interest, debtor
c. Rescission/ shall not have
Resolution (Article obligation to pay
1191) the same from the
2. Mora accipiendi time of the delay
The creditor incurs in e. Creditor becomes
delay when debtor liable for damages
tenders payment or f. Debtor may relieve
performance, but the himself by
creditor refuses to consignation of the
accept it without just thing
cause. 3. Compensatio morae
Mora accipiendi is Delay on both sides in
related to payment reciprocal obligations,
(consignation). cancel each other out.
Requisites: b. Not Attributable to the Debtor
a. An offer of (non-culpable)
performance by the Fortuitous event
debtor who has the
required capacity Art. 1174. Except in
b. The offer must be to cases expressly specified by the
comply with the law, or when it is otherwise
prestation as it declared by stipulation, or
should be when the nature of the
performed obligation requires the
c. The creditor refuses assumption of risk, no person
the performance shall be responsible for those
without just cause. events which could not be
Effects of Mora foreseen, or which, though
Accipiendi: foreseen, were inevitable.
a. Responsibility of
debtor for the thing Also governed by Article 1221
is limited to fraud but is called loss there, a cause
and gross fo extinguishment of obligation.
negligence Also called caso fortuioto, force
b. Debtor is exempted marjeure, act of God.
from risk of loss of
thing w/c
Art. 1221. If the thing has been lost or if the
automatically pass
prestation has become impossible without the fault of
to creditor
the solidary debtors, the obligation shall be
extinguished.

Art. 1165. When what is to be delivered is a If there was fault on the part of any one of
determinate thing, the creditor, in addition to the right them, all shall be responsible to the creditor, for the
granted him by article 1170, may compel the debtor to price and the payment of damages and interest,
make the delivery. without prejudice to their action against the guilty or
If the thing is indeterminate or generic, he negligent debtor.
may ask that the obligation be complied with at the If through a fortuitous event, the thing is lost
expense of the debtor. or the performance has become impossible after one of
If the obligor delays, or has promised to the solidary debtors has incurred in delay through the
deliver the same thing to two or more persons who do judicial or extrajudicial demand upon him by the
not have the same interest, he shall be responsible for creditor, the provisions of the preceding paragraph
any fortuitous event until he has effected the delivery. shall apply.

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Professor Ruben F. Balane Page 160 of 241
 Requisites (Nakpil vs. CA) usurious but because such rates were
1. The cause of the unforeseen unconscionable.
and unexpected occurrence, Correlate Article 1175 with Articles
or the failure to comply with 1957, 1413 and 1961.
his obligations, must be
independent of the human Art. 1176. The receipt of the
will principal by the creditor without
2. It must be impossible to reservation with respect to the
foresee the event which interest, shall give rise to the
constitute the caso fortuito, presumption that said interest has
or if it can be foreseen, it been paid.
must be impossible to avoid The receipt of a later
3. The occurrence must be installment of a debt without
such as to render it reservation as to prior installments,
impossible for the debtor to shall likewise raise the presumption
fulfill his obligation in a that such installments have been paid.
normal manner
4. The obligor must be free 2 Presumptions regarding:
from any participation in a. Interest bearing debt
the aggravation of the injury Presumption that interest has
resulting to the creditor been paid if the principal has
General Rule: When a debtor been received without
is unable to fulfill his obligation reservation regarding interest,
because of a fortuitous event or b. Debt payable in installments
force majeure, he cannot be Presumption that earlier
held liable for damages or non- installments have been paid if
performance. the later installment has been
Exceptions: received without reservation
1. When the law so provides regarding the previous
(i.e. Article 1165, 2) installments.
2. When there is express These are only rebuttable presumptions,
stipulation you can prove through other evidence.
Fortuitous event yields You can prove mistake.
to contrary stipulation.
3. When the nature of the Art. 1177. The creditors, after
obligation requires the having pursued the property in
assumption of risk (i.e. possession of the debtor to satisfy
insurance contracts) their claims, may exercise all the
3. Other Provisions rights and bring all the actions of the
latter for the same purpose, save
Art. 1175. Usurious those which are inherent in his
transactions shall be governed by person; they may also impugn the acts
special laws. which the debtor may have done to
defraud them.
Article 1175 is dead letter law because of
the lifting of the ceiling on interest rates. Enforcement of Creditors Remedies
Thus, usury has been decriminalized,
but the decriminalization cannot be
given retroactive effect (with respect to
Art. 1957. Contracts and stipulations, under any
the civil aspect). cloak or device whatever, intended to circumvent the
Some decisions have struck down high laws against usury shall be void. The borrower may
interests, not because they were recover in accordance with the laws on usury.
Art. 1413. Interest paid in excess of the
interest allowed by the usury laws may be recovered

Article 1165, 2. If the obligor delays, or has by the debtor, with interest thereon from the date of
promised to deliver the same thing to two or more the payment.
persons who do not have the same interest, he shall Art. 1961. Usurious contracts shall be
be responsible for any fortuitous event until he has governed by the Usury Law and other special laws, so
effected the delivery. far as they are not inconsistent with this Code.

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Professor Ruben F. Balane Page 161 of 241
 a. Levy and execution of the debtors name, such as the actions of the
non-exempt properties (Articles lessor against the sublessee
1177, 2236) (Article 1652), the laborer of an
b. Accion subrogatoria independent contractor against
Subrogatory action premised on the owner (Article 1729*), the
the theory that the debtor of principal against the subagent
my debtor is my debtor. (Article 1893), and the vendor-
Requisites: a-retro against the transferee of
i. Creditor has a right of credit the vendee (Article 1608).
against the debtor. This is an exception to the
ii. Credit is due and relativity of contracts.
demandable. Example 1:
iii. Failure of debtor to collect
his own credit from a third A B C
lease sub-lease
person either through There are two separate contracts
malice or negligence. here: The contract of lease
iv. Insufficiency of assets of the between A and B and the
debtor to satisfy the contract of sub-lease between B
creditors credit and C. C owes B P7000. B owes
v. Right (of account) is not A P5000.
intuitu personae Ordinarily, A cannot sue C since
c. Accion pauliana (Articles 1380- there is no relationship between
1389) them, but in Article 1652, A can
Right of creditors to rescind sue C for P5000.
alienations by debtor which are

prejudicial to them to the extent Art. 1652. The sublessee is subsidiarily liable to the
of the prejudice. lessor for any rent due from the lessee. However, the
Example: A donates land to C sublessee shall not be responsible beyond the amount
but he owes B. A has no other of rent due from him, in accordance with the terms of
property. B can rescind the the sublease, at the time of the extra-judicial demand
donation to C. The donation is by the lessor.
rescissible to the extent of the Payments of rent in advance by the sublessee
debt. shall be deemed not to have been made, so far as the
lessor's claim is concerned, unless said payments were
Requisites:
effected in virtue of the custom of the place.
i. There is a credit in favor of *
the plaintiff Art. 1729. Those who put their labor upon or furnish
ii. The debtor has performed materials for a piece of work undertaken by the
an act subsequent to the contractor have an action against the owner up to the
contract, giving advantage amount owing from the latter to the contractor at the
to other persons. time the claim is made. However, the following shall
not prejudice the laborers, employees and furnishers of
iii. The creditor is prejudiced
materials:
by the debtors act which are
(1) Payments made by the owner to the contractor
in favor of third parties and
before they are due;
rescission will benefit the
(2) Renunciation by the contractor of any amount
creditor. due him from the owner.
iv. The creditor has no other This article is subject to the provisions of
legal remedy. special laws.
v. The debtors acts are
Art. 1893. In the cases mentioned in Nos. 1 and 2
fraudulent. of the preceding article, the principal may furthermore
d. Accion directa bring an action against the substitute with respect to
A direct (not subrogatory) the obligations which the latter has contracted under
action by the creditor against his the substitution.
debtors debtor, a remedy which
Art. 1608. The vendor may bring his action against
gives the creditor the every possessor whose right is derived from the
prerogative to act in his own vendee, even if in the second contract no mention
should have been made of the right to repurchase,

Art. 2236. The debtor is liable with all his property, without prejudice to the provisions of the Mortgage
present and future, for the fulfillment of his Law and the Land Registration Law with respect to
obligations, subject to the exemptions provided by law. third persons.

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Professor Ruben F. Balane Page 162 of 241
 Example 2:
Art. 1183. Impossible
contract for a contract of
conditions, those contrary to good
A B customs or Cpublic policy and those
piece of work labor
Again,
(customer) are two separate
there (contractor) prohibited(worker)
by law shall annul the
contracts here: The contract for obligation which depends upon them.
a piece of work between A and B If the obligation is divisible, that part
and the contract of labor thereof which is not affected by the
between B and C. A owes B impossible or unlawful condition shall
P10,000 which is not fully paid be valid.
yet. B owes C P5000 for unpaid The condition not to do an
wages. C can go after A directly impossible thing shall be considered
for P5000. as not having been agreed upon.

Art. 1178. Subject to the laws, Art. 1184. The condition that
all rights acquired in virtue of an some event happen at a determinate
obligation are transmissible, if there time shall extinguish the obligation as
has been no stipulation to the soon as the time expires or if it has
contrary. become indubitable that the event will
not take place.
Rights are transmissible unless the
rights are personal. Art. 1185. The condition that
G. Different Kinds of Obligations some event will not happen at a
1. According to Demandability (Articles determinate time shall render the
1179-1192) obligation effective from the moment
the time indicated has elapsed, or if it
Art. 1179. Every obligation has become evident that the event
whose performance does not depend cannot occur.
upon a future or uncertain event, or If no time has been fixed, the
upon a past event unknown to the condition shall be deemed fulfilled at
parties, is demandable at once. such time as may have probably been
Every obligation which contemplated, bearing in mind the
contains a resolutory condition shall nature of the obligation.
also be demandable, without
prejudice to the effects of the Art. 1186. The condition shall
happening of the event. be deemed fulfilled when the obligor
voluntarily prevents its fulfillment.
Art. 1180. When the debtor
binds himself to pay when his means Art. 1187. The effects of a
permit him to do so, the obligation conditional obligation to give, once
shall be deemed to be one with a the condition has been fulfilled, shall
period, subject to the provisions of retroact to the day of the constitution
article 1197. of the obligation. Nevertheless, when
the obligation imposes reciprocal
Art. 1181. In conditional prestations upon the parties, the
obligations, the acquisition of rights, fruits and interests during the
as well as the extinguishment or loss pendency of the condition shall be
of those already acquired, shall deemed to have been mutually
depend upon the happening of the compensated. If the obligation is
event which constitutes the condition. unilateral, the debtor shall
appropriate the fruits and interests
Art. 1182. When the fulfillment received, unless from the nature and
of the condition depends upon the circumstances of the obligation it
sole will of the debtor, the conditional should be inferred that the intention
obligation shall be void. If it depends of the person constituting the same
upon chance or upon the will of a was different.
third person, the obligation shall take In obligations to do and not to
effect in conformity with the do, the courts shall determine, in each
provisions of this Code. case, the retroactive effect of the

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Professor Ruben F. Balane Page 163 of 241
 condition that has been complied of said conditions, shall return to each
with. other what they have received.
In case of the loss,
Art. 1188. The creditor may, deterioration or improvement of the
before the fulfillment of the condition, thing, the provisions which, with
bring the appropriate actions for the respect to the debtor, are laid down in
preservation of his right. the preceding article shall be applied
The debtor may recover what to the party who is bound to return.
during the same time he has paid by As for the obligations to do and
mistake in case of a suspensive not to do, the provisions of the second
condition. paragraph of article 1187 shall be
observed as regards the effect of the
Art. 1189. When the conditions extinguishment of the obligation.
have been imposed with the intention
of suspending the efficacy of an Art. 1191. The power to rescind
obligation to give, the following rules obligations is implied in reciprocal
shall be observed in case of the ones, in case one of the obligors
improvement, loss or deterioration of should not comply with what is
the thing during the pendency of the incumbent upon him.
condition: The injured party may choose
(1) If the thing is lost without the between the fulfillment and the
fault of the debtor, the rescission of the obligation, with the
obligation shall be payment of damages in either case. He
extinguished; may also seek rescission, even after he
(2) If the thing is lost through the has chosen fulfillment, if the latter
fault of the debtor, he shall should become impossible.
be obliged to pay damages; it The court shall decree the
is understood that the thing rescission claimed, unless there be
is lost when it perishes, or just cause authorizing the fixing of a
goes out of commerce, or period.
disappears in such a way that This is understood to be
its existence is unknown or it without prejudice to the rights of third
cannot be recovered; persons who have acquired the thing,
(3) When the thing deteriorates in accordance with articles 1385 and
without the fault of the 1388 and the Mortgage Law.
debtor, the impairment is to
be borne by the creditor; Art. 1192. In case both parties
(4) If it deteriorates through the have committed a breach of the
fault of the debtor, the obligation, the liability of the first
creditor may choose between infractor shall be equitably tempered
the rescission of the by the courts. If it cannot be
obligation and its fulfillment, determined which of the parties first
with indemnity for damages violated the contract, the same shall
in either case; be deemed extinguished, and each
(5) If the thing is improved by its shall bear his own damages.
nature, or by time, the
improvement shall inure to a. Pure
the benefit of the creditor; A pure obligation is one which has
(6) If it is improved at the neither a condition nor a term
expense of the debtor, he attached to it. It is one which is
shall have no other right than subject to no contingency.
that granted to the A pure obligation is demandable at
usufructuary. once (Article 1179).
b. Conditional
Art. 1190. When the conditions A condition is a future and uncertain
have for their purpose the event.
extinguishment of an obligation to All conditions are future.
give, the parties, upon the fulfillment Article 1179 mentions the term past
event unknown to the parties. This

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Professor Ruben F. Balane Page 164 of 241
 has been criticized by many The law does not
commentators. This is a require the delivery or
contradiction in terms. The payment of the fruits or
condition in a past even unknown to interests accruing
the parties is knowledge by the before the happening of
parties of the past event. the suspensive
In conditional obligation, the condition. The right to
happening of the condition the fruits of the thing is
determines its birth or death. In not within the principle
term, the happening of the term of retroactivity of
determines its demandability. conditional obligations
Types of Conditions (Article 1187)
i. 1. Suspensive If the obligation
The fulfillment of a imposes reciprocal
suspensive condition prestations, fruits and
results in the interest are deemed
acquisition of rights mutually compensated.
arising out of the Example: I promise to
obligation. sell my mango
The condition that some plantation at
event happen at a P5000/hectare if you
determinate time shall pass the bar
extinguish the examination.
obligation as soon as I do not have to give you
the time expires or if it the fruits from the time
has become indubitable of the agreement to the
that the event will not release of the bar
take place (Article 1184) exams.
The condition that some If the obligation is
event will not happen at unilateral, debtor
a determinate time shall appropriates the fruits.
render the obligation In obligations to do and
effective from the not to do, the courts
moment the time shall use sound
indicated has elapsed, discretion to determine
or if it has become the retroactive effect of
evident that the event the fulfillment of the
cannot occur (Article condition (Article 1187)
1185). The creditor may,
The moment the before the fulfillment of
suspensive condition the condition, bring the
happens, the obligation appropriate actions for
becomes effective and the preservation of his
enforceable. However, right (Article 1188, 1st ).
the effects of the JBL Reyes criticizes the
obligation retroact to use of the word bring.
the moment when such The 1st of Article 1188
obligation was does not limit itself to
constituted or created. judicial actions. Thus,
By the principle of the word take is
retroactivity, therefore, better.
a fiction is created The debtor who paid
whereby the binding tie before the happening of
of the conditional the condition may
obligation is produced recover only when he
from the time of its paid by mistake and
perfection, and not from provided the action to
the happening of the recover is brought
condition (Article 1187)

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Professor Ruben F. Balane Page 165 of 241
 before the condition the non-fulfillment of
(Article 1188). the obligation.
2. Resolutory Rescission is based on
The fulfillment of the economic prejudice.
resolutory condition Furthermore, the
results in the character of resolution
extinguishments of is principal and
rights arising out of the retaliatory while the
obligation. character of rescission
If the resolutory is subsidiary. This
condition is fulfilled, the means that in resolution
obligation is treated as there is no need to show
if it did not exist. Thus, that there is no other
each party is bound to remedy. In rescission,
return to the other the plaintiff must show
whatever he has that there is no other
received, so that they recourse.
may be returned to their The right of resolution
original condition applies to reciprocal
before the creation of obligations.
the obligation (Article A reciprocal obligation
1190). has 2 elements
Resolution (Article 1. 2 prestations
1191) is found on the arising from the
conditional obligations same source
because if there is a 2. Each prestation is
breach, the breach is a designed to be the
resolutory condition counterpart of the
which extinguishes the other
obligation. An example of a
Article 1191 uses the reciprocal obligation is
term rescission. The a contract of sale.
better term is Summary of Rulings on
resolution. The term Resolution
rescission is also found 1. The right to resolve
in Article 1381, is in inherent in
rescissible contracts. reciprocal
Resolution is different obligations.
from rescission. 2. The breach of the
Resolution is based on obligation must be
substantial. Proof

of substantial
Art. 1381. The following contracts are rescissible: breach is a
(1) Those which are entered into by guardians prerequisite for
whenever the wards whom they represent resolution.
suffer lesion by more than one-fourth of the 3. The right of
value of the things which are the object resolution can be
thereof; exercised
(2) Those agreed upon in representation of
extrajudicially and
absentees, if the latter suffer the lesion stated
will take effect upon
in the preceding number;
communication to
(3) Those undertaken in fraud of creditors when
the defaulting party.
the latter cannot in any other manner collect
the claims due them; This notice of
(4) Those which refer to things under litigation if resolution is
they have been entered into by the defendant necessary.
without the knowledge and approval of the 4. The exercise of this
litigants or of competent judicial authority; right can be the
(5) All other contracts specially declared by law to subject of judicial
be subject to rescission. review.

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Professor Ruben F. Balane Page 166 of 241
 5. Upon resolution, vinculum juris. The
there must be creditor can compel the
mutual restitution debtor to perform the
of the object and its obligation.
fruits Example: I will give
The parties are you my pomelo
returned to plantation if you
their original establish permanent
situation residence in Davao.
status quo ante. This is a suspensive
6. If the aggrieved condition dependent on
party has not the sole will of the
performed the creditor. It becomes
prestation and pure and demandable at
resolves once.
extrajudicially, then Article 1182 prohibits a
all the aggrieved suspensive potestative
party has to do is to condition dependent on
refuse to perform the will of the debtor.
his prestation. The entire obligation is
7. If the aggrieved void.
party has Example: I will sell you
performed the my car if I want to.
prestation, the Why does it annul the
aggrieved party can entire obligation?
demand recovery. Because there is no
If the defaulting juridical tie.
party refuses to Remember, an
return it, the obligation is one which
aggrieved party has to be performed
must go to court in regardless of the will of
order to recover. the debtor. There is no
In Ilingan vs.CA element of compulsion.
(September 26, 2001) In the example above,
case, there was an the creditor can never
obiter dictum that the compel, can never have
operative act that a cause of action.
resolves a contract is In reciprocal
the decree of court and obligations, the law only
the right should be talks about the first
exercised judicially. prestation, the
Professor Balane says reciprocal prestation is
this is wrong. However, not taken into
the ratio of the case said consideration.
that the communication 2. Casual
must be a notarial In a casual condition,
notice. the fulfillment of the
ii. 1. Potestative condition depends upon
In a potestative chance and/or upon the
condition, the will of a 3rd person and
fulfillment of the not on the will of a
condition depends upon party.
the will of a party to the Example: I will give
obligation. you my house if the
If the condition depends Philippines renounces
upon the will of the its foreign debt in 5
creditor, then the years. (Dependent
obligation is valid. In solely on the will of a
this case, there is a

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Professor Ruben F. Balane Page 167 of 241
 third person or on prevention of
chance). the fulfillment
3. Mixed of the
In a mixed condition, condition, it
the fulfillment of the will not fall
condition depends under the
partly upon the will of a doctrine of
party to the obligation constructive
and partly upon chance compliance.
and/or the will of a 3rd 2. Act
person. ual prevention of
When the condition compliance
depends not only upon The doctrine of
the will of the debtor, constructive
but also upon chance or compliance
will of the others, the applies to
obligation is valid. potestative and
Example: I will give mixed
you my house if you conditions.
marry him within 3
years. (The condition iii. 1. Possible
here is a mixed A condition is possible
condition. In this case, when it is capable of
the condition of realization according to
marriage depends nature, law, public
partly on the creditor, a policy or good customs.
party to the obligation, 2. Impossible
and partly on a 3rd A condition is
person.) impossible when it is
Doctrine of Constructive not capable of
Compliance realization according to
The condition shall be nature, law, public
deemed fulfilled when policy or good customs.
the obligor voluntarily The effect of an
prevents its fulfillment impossible condition is
(Article 1186). to annul the obligation
The principle (Article 1183). The
underlying constructive effect of an impossible
fulfillment of conditions condition regarding
is that a party to a donations and
contract may not be succession is different.
excused from In donations and
performing his promise succession, an
by the non-occurrence impossible condition is
of an event which he simply disregarded.
himself prevented. The distinction can be
Requisites explained by the fact
1. Int that Article 1183 refers
ent of the debtor to to onerous obligation
prevent fulfillment whereas donations and
of the obligation succession are
Where the act gratuitous.
of the debtor, However, if the
however, obligation is divisible
although and that part of the
voluntary, did obligation is not
not have for its unaffected by the
purpose the impossible condition,

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Professor Ruben F. Balane Page 168 of 241
 then the obligation is 2. Implied
valid (Article 1183). A condition is implied
Justice Paras when the condition is
distinguishes as follows: tacit.
1. Positive condition c. Term (Articles 1193-1198)
to do something
impossible Art. 1193. Obligations for
Void condition whose fulfillment a day certain has
and obligation been fixed, shall be demandable
2. Negative condition only when that day comes.
not to do something Obligations with a
impossible resolutory period take effect at
Disregard the once, but terminate upon arrival
condition, the of the day certain.
obligation is A day certain is understood
valid to be that which must necessarily
3. Negative condition come, although it may not be
not to do something known when.
illegal If the uncertainty consists
Valid condition in whether the day will come or
and obligation not, the obligation is conditional,
iv. 1. Positive and it shall be regulated by the
A condition is positive rules of the preceding Section.
when the condition
involves the Art. 1194. In case of loss,
performance of an act. deterioration or improvement of
2. Negative the thing before the arrival of the
A condition is negative day certain, the rules in article
when the condition 1189 shall be observed.
involves the non-
performance of an act. Art. 1195. Anything paid or
v. 1. Divisible delivered before the arrival of the
period, the obligor being unaware
A condition is divisible
of the period or believing that the
when the condition is
obligation has become due and
susceptible of partial
demandable, may be recovered,
realization.
with the fruits and interests.
2. Indivisible
A condition is
Art. 1196. Whenever in an
indivisible when the obligation a period is designated,
condition is not
it is presumed to have been
susceptible of partial established for the benefit of both
realization.
the creditor and the debtor, unless
vi. 1. Conjunctive from the tenor of the same or
A condition is other circumstances it should
conjunctive when there appear that the period has been
are several conditions, established in favor of one or of
all of which must be the other.
realized.
2. Alternative Art. 1197. If the obligation
A condition is does not fix a period, but from its
alternative when there nature and the circumstances it
are several conditions, can be inferred that a period was
only one of which must intended, the courts may fix the
be realized. duration thereof.
vii. 1. Express The courts shall also fix the
A condition is express duration of the period when it
when the condition is depends upon the will of the
stated expressly. debtor.

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Professor Ruben F. Balane Page 169 of 241
 In every case, the courts the debtor waives the benefit of the
shall determine such period as term.
may under the circumstances have An obligation was entered on
been probably contemplated by May 1, 2002 between A and B.
the parties. Once fixed by the The obligation is to be
courts, the period cannot be performed on October 1, 2002.
changed by them. A delivers on September 1, 2002
by mistake to B. A discovers his
Art. 1198. The debtor shall mistake and tells B to return the
lose every right to make use of the object and the fruits delivered.
period: Article 1195 does not answer
(1) When after the obligation who is entitled to the fruits
has been contracted, he which have been produced in
becomes insolvent, unless the meantime (May 1, 2002 to
he gives a guaranty or October 1, 2002).
security for the debt; According to the Spanish Code,
(2) When he does not furnish the debtor (A) can only fruits.
to the creditor the There are 2 views:
guaranties or securities i. The debtor is entitled to the
which he has promised; fruits produced in the
(3) When by his own acts he meantime (Tolentino)
has impaired said This is because delivery
guaranties or securities is not required until
after their establishment, October 1.
and when through a ii. The creditor is entitled to
fortuitous event they the fruits since the
disappear, unless he obligation is demandable
immediately gives new only when the period arrives
ones equally satisfactory; This is because the
(4) When the debtor violates obligation is already
any undertaking, in existing although it is
consideration of which not yet demandable.
the creditor agreed to the Professor Balane believes
period; that the fruits belong to the
(5) When the debtor attempts debtor. Why would Article
to abscond. 1195 allow the debtor to
recover the fruits if he
A term is a length of time which, should still give them back
exerting an influence on an after the term comes.
obligation as a consequence of Instances when the Fruits
juridical acts, suspends its Cannot be Recovered
demandability or determines its i. When the obligation is
extinguishment. reciprocal and there has
A term is a future and certain event been prepayment of both
(i.e. death) sides
When the debtor binds himself to ii. When the obligation is a
pay when his means permit him to loan and the debtor is
do so, the obligation is one with a bound to pay interest
term (Article 1180). Although iii. When the period is
Article 1180 looks like a condition exclusively for the creditors
dependent on the sole will of the benefit
debtor, the law treats it as a term. iv. When the debtor is aware of
If prepayment is made without the the period and pays anyway
debtor being aware that the period waiver
had not yet arrived, then the thing The presumption is that the period
and the fruits can be recovered is for the benefit of both the debtor
(Article 1195). If prepayment is and the creditor (Article 1196). The
made and the debtor was aware that effect of this presumption is that the
the period had not yet arrived, then creditor cannot demand payment

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Professor Ruben F. Balane Page 170 of 241
 before the period arrives nor can the the thing pledged, the creditor
debtor demand the creditor to may either claim another thing
accept payment before the period in its stead or demand
arrives. immediate payment of the
Example: A issues a promissory principal obligation (Article
note to B demandable on October 2109)
15. A cannot insist on prepayment Types of Periods
nor can B insist that he be paid on i. 1. Suspensive (ex die)
September. The period is suspensive
If the period is for the benefit of the when the obligation
creditor only, the creditor can becomes demandable
demand performance at any time, only upon the arrival of
but the debtor cannot compel him to the period.
accept payment before the period 2. Resolutory (in diem)
expires. The period is resolutory
If the period is for the benefit of the when the performance
debtor only, the debtor can he may must terminate upon
oppose a premature demand for the arrival of the period.
payment, but may validly pay at any ii. 1. Legal
time before the period expires. A period is legal when it
When the obligation is worded is granted by law.
such that payment it to be made 2. Voluntary
within 6 months, the period is A period is voluntary
for the benefit of the debtor. when it is stipulated by
When the obligation is worded the parties.
such that payment is to be made 3. Judicial
on or before, the period is for A period is judicial when it is fixed by
the benefit of the debtor. the courts.
The debtor shall lose every right to If the obligation does not fix a period,
make use of the period: but from its nature and the
i. When after the obligation has circumstances it can be inferred that a
been contracted, the debtor period was intended, the courts may
becomes insolvent unless he fix the duration thereof (Article 1197,
gives a guaranty or security for 1st ).
the debt (Article 1198 (1)) 2 steps involved in an action for fixing a
The insolvency here need period:
not be judicial. It can be 1. The court should determine that the
actual insolvency. obligation does not fix a period but it
ii. When he does not furnish to the can be inferred that a period is
creditor the guaranties or intended due to the circumstances OR
securities which he has the period is dependent on debtors
promised (Article 1198 (2)) will.
iii. When by his own acts he has 2. Court shall decide what period was
impaired the said guaranties or probably contemplated by the parties.
securities after their Court should make an educated guess.
establishment, and when Court should not fix a period which it
through a fortuitous event hey thinks is fair or reasonable but rather
disappear, unless he the period which was probably
immediately gives new ones contemplated by the parties.
equally satisfactory (Article Generally, you cannot ask for specific
1198 (3)) performance because fixing a period
iv. When the debtor violates any contemplates something in the future,
undertaking, in consideration of hence to ask for specific performance
which the creditor agreed would be illogical.
(Article 1198 (4))
Instances When Court May Fix a Period
v. When the debtor attempts to
1. Article 1197, 1
abscond (Article 1198 (5))
vi. When the creditor is deceived
on the substance or quality of

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Professor Ruben F. Balane Page 171 of 241
 Art. 1197, 1. If the Art. 1197, 2. The courts
obligation does not fix a period, shall also fix the duration of the
but from its nature and the period when it depends upon the
circumstances it can be inferred will of the debtor.
that a period was intended, the
courts may fix the duration 3. Article 1191, 3
thereof.
Art. 1191, 3. The court
Exceptions shall decree the rescission
a. Articles 1682 and 1687, 1st sentence claimed, unless there be just
cause authorizing the fixing of a
Art. 1682. The lease of a period.
piece of rural land, when its
duration has not been fixed, is 4. Article 1687, 2nd, 3rd and 4th sentences
understood to have been for all
the time necessary for the Art. 1687, 2nd, 3rd and 4th
gathering of the fruits which the sentences. However, even
whole estate leased may yield in though a monthly rent is paid,
one year, or which it may yield and no period for the lease has
once, although two or more been set, the courts may fix a
years have to elapse for the longer term for the lease after
purpose. the lessee has occupied the
premises for over one year. If the
Art. 1687, 1st sentence. If rent is weekly, the courts may
the period for the lease has not likewise determine a longer
been fixed, it is understood to be period after the lessee has been
from year to year, if the rent in possession for over six
agreed upon is annual; from months. In case of daily rent, the
month to month, if it is monthly; courts may also fix a longer
from week to week, if the rent is period after the lessee has stayed
weekly; and from day to day, if in the place for over one month.
the rent is to be paid daily.
5. Article 1180
b. Pacto de retro sales (Article 1606)
Art. 1180. When the
Art. 1606. The right debtor binds himself to pay when
referred to in article 1601, in the his means permit him to do so,
absence of an express the obligation shall be deemed to
agreement, shall last four years be one with a period, subject to
from the date of the contract. the provisions of Article 1197.
Should there be an
agreement, the period cannot iii. 1. Express
exceed ten years. A period is express when the period is
However, the vendor may specifically stated.
still exercise the right to 2. Tacit
repurchase within thirty days A period is tacit when a person
from the time final judgment undertakes to do some work which
was rendered in a civil action on can be done only during a particular
the basis that the contract was a season.
true sale with right to iv. 1. Original
repurchase. 2. Grace
A grace period is an extension fixed by
c. Contract of services for an indefinite the parties or by the court.
period v. 1. Definite
Court cannot fix a period or else it A period is definite when it refers to a
would amount to involuntary fixed known date or time.
servitude. 2. Indefinite
2. Article 1197, 2 A period is indefinite when it refers to
an event which will necessarily

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Professor Ruben F. Balane Page 172 of 241
 happen but the date of its happening alternative from the day when the
is unknown (i.e. death) selection has been communicated to
the debtor.
2. According to Plurality of Object Until then the responsibility of
(Articles 1199-1206) the debtor shall be governed by the
following rules:
Art. 1199. A person (1) If one of the things is lost
alternatively bound by different through a fortuitous event,
prestations shall completely perform he shall perform the
one of them. obligation by delivering that
The creditor cannot be which the creditor should
compelled to receive part of one and choose from among the
part of the other undertaking. remainder, or that which
remains if only one subsists;
Art. 1200. The right of choice (2) If the loss of one of the things
belongs to the debtor, unless it has occurs through the fault of
been expressly granted to the the debtor, the creditor may
creditor. claim any of those subsisting,
The debtor shall have no right or the price of that which,
to choose those prestations which are through the fault of the
impossible, unlawful or which could former, has disappeared,
not have been the object of the with a right to damages;
obligation. (3) If all the things are lost
through the fault of the
Art. 1201. The choice shall debtor, the choice by the
produce no effect except from the creditor shall fall upon the
time it has been communicated. price of any one of them, also
with indemnity for damages.
Art. 1202. The debtor shall The same rules shall be applied
lose the right of choice when among to obligations to do or not to do in
the prestations whereby he is case one, some or all of the
alternatively bound, only one is prestations should become
practicable. impossible.

Art. 1203. If through the Art. 1206. When only one

creditor's acts the debtor cannot make prestation has been agreed upon, but
a choice according to the terms of the the obligor may render another in
obligation, the latter may rescind the substitution, the obligation is called
contract with damages. facultative.
The loss or deterioration of the
Art. 1204. The creditor shall thing intended as a substitute,
have a right to indemnity for damages through the negligence of the obligor,
when, through the fault of the debtor, does not render him liable. But once
all the things which are alternatively the substitution has been made, the
the object of the obligation have been obligor is liable for the loss of the
lost, or the compliance of the substitute on account of his delay,
obligation has become impossible. negligence or fraud.
The indemnity shall be fixed
taking as a basis the value of the last a. Alternative
thing which disappeared, or that of An obligation is alternative when
the service which last became several objects or prestations are
impossible. due, but the payment or
Damages other than the value performance of 1 of them would be
of the last thing or service may also be sufficient.
awarded. A promises to deliver either 500 kgs
of rice or 1000 liters of gas. The
Art. 1205. When the choice has obligation is alternative. The debtor
been expressly given to the creditor, cannot perform the obligation by
the obligation shall cease to be giving 250 kgs of rice and 500 liters

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Professor Ruben F. Balane Page 173 of 241
 of gas unless the creditor agrees. In iii. When all the things are lost due
which case there is a novation. to the debtors fault, the creditor
General Rule: The right of choice can sue for damages (Article
the right to belongs to the debtor. 1204)
Exceptions: iv. When some things are lost due
i. When it is expressly granted to to the debtors fault but there
the creditor are still some things remaining,
ii. When it is agreed upon by the then the debtor can choose from
parties that a 3rd person shall whats left
make the choice v. When all the things are lost due
The act of making the choice is to a fortuitous event, the
called concentration. Once the obligation is extinguished
choice has been made, then the vi. When all but 1 of the things are
obligation is concentrated in 1 lost due to a fortuitous event
object. and the last object is lost
Whoever has the right of choice through the debtors fault, then
must communicate it to the other the creditor can sue for damages
party (Article 1201). The creditor vii. When all but 1 of the things are
has to communicate his choice to lost through the debtors own
the debtor so that the debtor will acts and the last object is lost
know. On the other hand, in Ong through a fortuitous event, the
Guan vs. Century Insurance, the obligation is extinguished
Supreme Court said that the Choice Belongs to the Creditor
purpose for notice to the creditor is (Article 1205)
to give the creditor the opportunity i. When 1 or some of the objects
to express his consent or to impugn are lost through fortuitous
the election made by the debtor. events, then the creditor
Professor Balane does not agree chooses from the remainder
with this statement since the ii. When 1 or some of the objects
creditor does not have the right to are lost due to the debtors fault,
impugn, otherwise, the obligation the creditor may choose from
would not be an alternative the remainder or get the value of
obligation. A better reason any of the objects lost plus
according to Professor Balane is to damages in either case
give the creditor time to prepare. iii. When all of the things are lost
Example: The choice is either to due to the debtors fault, the
give diamond ring or a Mercedes creditor can get the value of any
Benz. The debtor should notify the of the objects lost plus damages
creditor so the creditor can either iv. When some are lost through the
rent a safety deposit box or prepare debtors fault, the creditor
a garage. chooses from the remainder
However, according to Professor v. When all the objects are lost due
Balane, the best reason is because to a fortuitous event, then the
once the choice is communicated, obligation is extinguished
the obligation ceases to be vi. When all the objects are lost due
alternative. The risk of loss belongs to the creditors fault, the
to the creditor now. obligation is extinguished
Choice Belongs to the Debtor b. Facultative
i. When through fortuitous event An obligation is facultative when
or through the debtors acts, only 1 object or prestation has been
there is only 1 prestation left, agreed upon by the parties to the
the obligation ceases to be obligation, but the debtor may
alternative (Article 1202). deliver or render another in
ii. When the choice of the debtor is substitution.
limited through the creditors Facultative obligations bear a
own acts, then the debtor has resemblance to alternative
the remedy of resolution (Article obligations particularly when the
1191) plus damages (Article choice in an alternative obligation is
1203) with the debtor.

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Professor Ruben F. Balane Page 174 of 241
 In a facultative obligation, the right enforced only by proceeding against
of choice is always with the debtor. all the debtors. If one of the latter
In an alternative obligation, if 1 of should be insolvent, the others shall
the prestations is impossible, then not be liable for his share.
there are other choices. In a
facultative obligation, if the Art. 1210. The indivisibility of
principal obligation is impossible, an obligation does not necessarily give
then everything is annulled. rise to solidarity. Nor does solidarity
In theory, it is easy to distinguish a of itself imply indivisibility.
facultative obligation from an
alternative obligation. In practice, it Art. 1211. Solidarity may exist
is difficult to do so since most of the although the creditors and the debtors
time, the words are ambiguous. For may not be bound in the same manner
example, I promise to deliver my and by the same periods and
Honda Accord, but I reserve my conditions.
right to substitute this with my
Gold Rolex. In this case, it is not Art. 1212. Each one of the
very clear whether the obligation is solidary creditors may do whatever
alternative or facultative. According may be useful to the others, but not
to Professor Balane, the rule is that anything which may be prejudicial to
one must look at the circumstances the latter.
of the obligation. If it is impossible
to determine which one, then the Art. 1213. A solidary creditor
doubt should be resolved in the cannot assign his rights without the
favor of an alternative obligation consent of the others.
since its effects are less radical.
Art. 1214. The debtor may pay
3. According to Plurality of Subject any one of the solidary creditors; but
(Articles 1207-1222) if any demand, judicial or
extrajudicial, has been made by one of
Art. 1207. The concurrence of them, payment should be made to
two or more creditors or of two or him.
more debtors in one and the same
obligation does not imply that each Art. 1215. Novation,
one of the former has a right to compensation, confusion or
demand, or that each one of the latter remission of the debt, made by any of
is bound to render, entire compliance the solidary creditors or with any of
with the prestation. There is a the solidary debtors, shall extinguish
solidary liability only when the the obligation, without prejudice to
obligation expressly so states, or when the provisions of article 1219.
the law or the nature of the obligation The creditor who may have
requires solidarity. executed any of these acts, as well as
he who collects the debt, shall be
Art. 1208. If from the law, or liable to the others for the share in the
the nature or the wording of the obligation corresponding to them.
obligations to which the preceding
article refers the contrary does not Art. 1216. The creditor may
appear, the credit or debt shall be proceed against any one of the
presumed to be divided into as many solidary debtors or some or all of
shares as there are creditors or them simultaneously. The demand
debtors, the credits or debts being made against one of them shall not be
considered distinct from one another, an obstacle to those which may
subject to the Rules of Court subsequently be directed against the
governing the multiplicity of suits. others, so long as the debt has not
been fully collected.
Art. 1209. If the division is
impossible, the right of the creditors Art. 1217. Payment made by
may be prejudiced only by their one of the solidary debtors
collective acts, and the debt can be extinguishes the obligation. If two or

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Professor Ruben F. Balane Page 175 of 241
 more solidary debtors offer to pay, the creditor, the provisions of the
creditor may choose which offer to preceding paragraph shall apply.
accept.
He who made the payment may Art. 1222. A solidary debtor
claim from his co-debtors only the may, in actions filed by the creditor,
share which corresponds to each, with avail himself of all defenses which are
the interest for the payment already derived from the nature of the
made. If the payment is made before obligation and of those which are
the debt is due, no interest for the personal to him, or pertain to his own
intervening period may be demanded. share. With respect to those which
When one of the solidary personally belong to the others, he
debtors cannot, because of his may avail himself thereof only as
insolvency, reimburse his share to the regards that part of the debt for which
debtor paying the obligation, such the latter are responsible.
share shall be borne by all his co-
debtors, in proportion to the debt of a. Single
each. An obligation is single when there is
only 1 debtor and 1 creditor.
Art. 1218. Payment by a b. Joint
solidary debtor shall not entitle him to An obligation is joint when each of
reimbursement from his co-debtors if the debtor is liable only for a
such payment is made after the proportional part of the debt, and
obligation has prescribed or become each creditor is entitled only to a
illegal. partial part of the credit.
A joint obligation is also called
Art. 1219. The remission made mancomunada, pro rata,
by the creditor of the share which mancomunada simple.
affects one of the solidary debtors General Rule: The obligation is
does not release the latter from his joint since joint obligations are less
responsibility towards the co-debtors, onerous.
in case the debt had been totally paid Exceptions:
by anyone of them before the i. Agreement of the parties
remission was effected. ii. Law (i.e. tort feasors are
solidarily liable)
Art. 1220. The remission of the iii. Nature of the obligation
whole obligation, obtained by one of
According to many
the solidary debtors, does not entitle
commentators, this is
him to reimbursement from his co-
superfluous since a solidary
debtors.
obligation arises because of
law.
Art. 1221. If the thing has been
ESSENTIAL NATURE: There are as
lost or if the prestation has become
many obligations as there are
impossible without the fault of the
creditors multiplied by as many
solidary debtors, the obligation shall
debtors.
be extinguished.
If there was fault on the part of Types of Joint Obligations
any one of them, all shall be i. Active joint
responsible to the creditor, for the In active joint, there are
price and the payment of damages and multiple creditors.
interest, without prejudice to their A, B, and C are creditors,
action against the guilty or negligent and X is the debtor. If the
debtor. obligation is joint, there are
If through a fortuitous event, 3 obligations Xs
the thing is lost or the performance obligation to A, Xs
has become impossible after one of obligation to B, and Xs
the solidary debtors has incurred in obligation to C.
delay through the judicial or The demand of 1 creditor on
extrajudicial demand upon him by the 1 debtor will not constitute a
demand on the others.

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Professor Ruben F. Balane Page 176 of 241
 The prescription of 1 of the According to many
debts will not affect the commentators, this is
other debts. superfluous since a solidary
ii. Passive joint obligation arises because of
In passive joint, there are law.
multiple debtors. Types of Solidary Obligations
X, Y, and Z are debtor, and i. Active solidary
A is the creditor. If the In active solidary, there are
obligation is joint, there are multiple creditors.
3 obligations Xs Characteristics of Active
obligation to A, Ys Solidary
obligation to A, and Zs A credit once paid is
obligation to A. shared equally among
The demand of 1 creditor on the creditors unless a
1 debtor will not constitute a different intention
demand on the others. appears.
The prescription of 1 of the The debtor may pay
debts will not affect the any of the creditors,
other debts. but if any demand,
The insolvency of 1 of the judicial or
debtors will not affect the extrajudicial is
burden of the other debtors. made on him, he
iii. Mixed joint must pay only to the
In mixed joint, there are one demanding
multiple creditors and payment (Article
debtors. 1214).
X, Y, and Z are debtors, and Article 1214 can
A, B, and C are the be open to
creditors. If the obligation abuse. For
is joint, there are 9 example, if A
obligations Xs obligation writes Y
to A, Xs obligation to B, Xs demanding the
obligation to C, Ys performance of
obligation A, Ys obligation the obligation
to B, Ys obligation to C, Zs and A takes no
obligation to A, Zs further action,
obligation to B, and Zs B and C cannot
obligation to C. demand from Y.
c. Solidary This is open to
An obligation is solidary when any collusion.
of the debtors can be hled liable for Suppose A, B,
the entire obligation, and any of the and C are
creditors is entitled to demand the creditors of X.
entire obligation. A demands the
A solidary obligation is also called payment of the
joint and several, joint and loan worth
individual, and in solidum. P9,000. X
If a promissory says, I promise to instead pays to
pay, and it is signed by K, B, and M, B. The payment
then the obligation is solidary. to B will be
An obligation is solidary when treated as a
i. The parties so agree payment to a 3rd
ii. When the law so provides (i.e. person.
tort feasors are solidarily liable) Therefore, X
iii. When nature of the obligation must still pay A
requires the obligation to be the amount of
solidary the loan minus
the share of B.

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Professor Ruben F. Balane Page 177 of 241
 So, X has to pay Suppose the debtor
P6,000 to A. upon whom the
ii. Passive solidary demand is made
In passive solidary, there pays a creditor who
are multiple debtors. did not make a
Characteristics of Passive demand. The
Solidary payment is
Each debtor may be considered a
required to pay the entire payment to a third
obligation but after person. Therefore
payment, he can recover the debtor can still
from his co-debtors their be made to pay by
respective shares. the one who made
iii. Mixed solidary the demand on him.
In mixed solidary, there are Example: X owes A
multiple debtors and and B. B demanded
creditors. from X. X pays A.
Characteristics of Mixed X must still pay B
Solidary P6000.
A credit once paid is But the payment to
shared equally among the demanding
the creditors unless a creditor can be
different intention reduced by the
appears. share of the paid
creditor.
The debtor may pay any
The debtor can still
of the creditors, but if
recover from the
any demand, judicial or
paid creditor
extrajudicial, is made
(unjust
on him, he must pay
enrichment).
only to the one
demanding payment Suppose A and B
(Article 1214). are creditors while
X and Y are debtors.
According to
A demands from Y.
Professor Balane,
Now, X pays B. The
Article 1214 is
payment of X to B
problematic. For
extinguishes the
example, X owes A,
entire solidary
B and C. B makes
obligation. X is not
an extrajudicial
bound by the
demand on X. X
demand by A on Y.
cannot pay A or C
There is no
anymore. The
violation of Article
problem is when B
1214.
does not follow up
the demand, it can Each debtor may be
keep the obligation required to pay the
in suspension entire obligation but
indefinitely. after payment, he can
The rule in the recover from his co-
Spanish Code was debtors their respective
that the debtor shares.
cannot pay the Is there a conflict between Article
other non- 1212 and Article 1215? Article 1212
demanding solidary

creditors only if one Art. 1212. Each one of the solidary creditors may
of the solidary do whatever may be useful to the others, but not
creditor makes a anything which may be prejudicial to the latter.
judicial demand. Art. 1215. Novation, compensation,
confusion or remission of the debt, made by any of the

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Professor Ruben F. Balane Page 178 of 241
 provides that each of the solidary debtor for the balance. Otherwise,
creditors may do whatever may be the effect of remission would be
useful to the others, but not extended. However, Y can recover
anything which may be prejudicial P4,500 from W, X, and Z.
to the latter. But Article 1215 allows A is the creditor of W, X, Y, and Z.
novation, compensation, confusion W, X, Y, and Z owe A P6,000. The
or remission on the part of the obligation is solidary. A remits Ys
solidary creditor. Why? According share P1,500. Z becomes
to Professor Balane, this is absurd. insolvent. A sues W for the balance
One way of reconciling is that under of P4,500. Art. 1217 must be
Article 1215, any creditor can remit applied. Thus, the insolvency of Z is
or condone the obligation. But shouldered by W, X, and Y. So, W
because the obligation is can recover P2,000 from X and
extinguished, the condoning P500 from Y instead of collecting
creditor must be liable for the other P3,000. W has to shoulder P500 as
creditors share. Here, there is no a loss due to Zs insolvency.
prejudice. 3 Kinds of Defenses
However, another problem arises if i. Real defenses
the condoning creditor later on These are defenses derived
becomes insolvent. from the nature of the
Art. 1219. The remission made obligation.
by the creditor of the share A real defense is a total
which affects one of the defense. It benefits all the
solidary debtors does not debtors.
release the latter from his ii. Personal defenses
responsibility towards the co- Personal defenses may
debtors, in case the debt had either be total or partial
been totally paid by anyone of defenses.
them before the remission was An example of a total
effected. personal defense is if the
A is the creditor of W, X, Y, and Z. consent of the debtors were
W, X, Y, and Z owe A P6,000. The all vitiated.
obligation is solidary. A remits Ys An example of a partial
share P1,500. A can go after X for defense is that a certain
only P4,500. The remission benefits amount is not yet due. It is
X initially since X only has to pay partial since there may be
P4,500 instead of 6,000. However, amounts which are already
X can only recover P3,000 from W due. Thus, the debtor has to
and Z. pay for those amounts
A is the creditor of W, X, Y, and Z. which are due.
W, X, Y, and Z owe A P6,000. The iii. Defenses which are personal to
obligation is solidary. A remits Ys the other co-debtors
share P1,500. A can go after Y for The debtor can only avail
the balance since Y is still a solidary himself of these defenses
solidary creditors or with any of the solidary debtors, only with regard to the part
shall extinguish the obligation, without prejudice to the of the debt which his co-
provisions of article 1219. debtors are responsible for.
The creditor who may have executed any of these acts, These defenses are partial.
as well as he who collects the debt, shall be liable to The debtor sued can invoke all three
the others for the share in the obligation corresponding kinds of defenses. The difference is
to them. Art. 1215. Novation, compensation, whether such defense would result
confusion or remission of the debt, made by any of the in total or partial exculpation.
solidary creditors or with any of the solidary debtors,
shall extinguish the obligation, without prejudice to the 4. According to Performance (Articles
provisions of article 1219. 1223-1225)
The creditor who may have executed any of
these acts, as well as he who collects the debt, shall be Art. 1223. The divisibility or
liable to the others for the share in the obligation indivisibility of the things that are the
corresponding to them.

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Professor Ruben F. Balane Page 179 of 241
 object of obligations in which there is i. When the parties provide otherwise
only one debtor and only one creditor (Articles 1225, 3rd , 1248)
does not alter or modify the ii. When the nature of the obligation
provisions of Chapter 2 of this Title. necessarily entails the performance
of the obligation in parts
Art. 1224. A joint indivisible Example: Hiring a security
obligation gives rise to indemnity for guard to guard from 8pm to
damages from the time anyone of the 2am daily for 6 months. This
debtors does not comply with his obligation cannot be performed
undertaking. The debtors who may indivisibly. You cant compress
have been ready to fulfill their time.
promises shall not contribute to the When the obligation has for its
indemnity beyond the corresponding object the execution of a certain
portion of the price of the thing or of number of days of work, the
the value of the service in which the accomplishment of work by
obligation consists. metrical units, or analogous
things, which by their nature are
Art. 1225. For the purposes of susceptible of partial
the preceding articles, obligations to performance, it shall be divisible
give definite things and those which (Article 1225, 2nd )
are not susceptible of partial Exception to the Exception:
performance shall be deemed to be However, even though the
indivisible. object or service may be
When the obligation has for its physically divisible, an
object the execution of a certain obligation is indivisible if
number of days of work, the 1. So provided by law; or
accomplishment of work by metrical 2. Intended by the parties.
units, or analogous things which by iii. When the law provides otherwise
their nature are susceptible of partial There are provisions on
performance, it shall be divisible. payment which provide that
However, even though the performance may be divisible.
object or service may be physically
Divisibility of the object does not mean
divisible, an obligation is indivisible if
that the obligation is also divisible. But
so provided by law or intended by the
indivisibility of the object necessarily
parties.
means an indivisible obligation.
In obligations not to do,
The test of divisibility of an obligation is
divisibility or indivisibility shall be
whether or not it is susceptible of partial
determined by the character of the
performance.
prestation in each particular case.
For example, if X is supposed to
deliver 1000 kilos of sugar, this does
Divisible and indivisible obligations
not mean that X can deliver the
have nothing to do with the object of the
sugar in installments.
prestation. A common misconception is
if the object of the prestation is divisible,
5. According to Sanction for Breach
then the obligation is also divisible.
(Articles 1226-1230)
a. Divisible
An obligation is divisible when it is
Art. 1226. In obligations with a
susceptible to partial performance.
penal clause, the penalty shall
b. Indivisible
substitute the indemnity for damages
An obligation is indivisible when it
cannot be validly performed in
Art. 1248. Unless there is an express stipulation to
parts.
that effect, the creditor cannot be compelled partially
General Rule: Obligations are to receive the prestations in which the obligation
indivisible. consists. Neither may the debtor be required to make
Exceptions: partial payments.
However, when the debt is in part liquidated
and in part unliquidated, the creditor may demand and
the debtor may effect the payment of the former
without waiting for the liquidation of the latter.

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Professor Ruben F. Balane Page 180 of 241
 and the payment of interests in case of Penal clauses are governed by
noncompliance, if there is no Articles 2226-2228, the provisions
stipulation to the contrary. on liquidated damages since a penal
Nevertheless, damages shall be paid if clause is the same as liquidated
the obligor refuses to pay the penalty damages (Lambert vs. Fox).
or is guilty of fraud in the fulfillment Penal clauses may be reduced by the
of the obligation. courts if unconscionable.
The penalty may be enforced 2 Functions of a Penal Clause (SSS
only when it is demandable in vs. Moonwalk)
accordance with the provisions of this i. To provide liquidated damages
Code. The creditor can demand
liquidated damages without
Art. 1227. The debtor cannot having to prove actual
exempt himself from the performance damages.
of the obligation by paying the
The only limitation that the
penalty, save in the case where this
courts will reduce the
right has been expressly reserved for
liquidated damages if the
him. Neither can the creditor demand
same is scandalously
the fulfillment of the obligation and
unconscionable.
the satisfaction of the penalty at the
ii. To strengthen the coercive force
same time, unless this right has been
of the obligation by the threat of
clearly granted him. However, if after
greater responsibility in case of
the creditor has decided to require the
breach
fulfillment of the obligation, the
Stipulates a penalty which is
performance thereof should become
greater than one without a
impossible without his fault, the
penal clause. Thus, Robes-
penalty may be enforced.
Francisco states that 4%
interest is not a penal
Art. 1228. Proof of actual
clause.
damages suffered by the creditor is
not necessary in order that the 2 Characteristics of a Penal Clause
penalty may be demanded. i. Subsidiary or alternative (Article
1227)
Art. 1229. The judge shall General Rule: Upon
equitably reduce the penalty when the breach of the obligation, the
principal obligation has been partly or creditor has to choose
irregularly complied with by the whether to demand the
debtor. Even if there has been no principal or the penalty.
performance, the penalty may also be Exception: The principal
reduced by the courts if it is iniquitous obligation and the penalty
or unconscionable. can be demanded when the
penal clause is joint or
Art. 1230. The nullity of the cumulative. This occurs
penal clause does not carry with it when it is the creditor has
that of the principal obligation. been clearly granted such
The nullity of the principal right (Article 1227, 2nd
obligation carries with it that of the sentence), either expressly
penal clause.
Art. 2226. Liquidated damages are those agreed
a. No penal clause upon by the parties to a contract, to be paid in case of
breach thereof.
b. With penal clause Art. 2227. Liquidated damages, whether
A penal clause is an accessory intended as an indemnity or a penalty, shall be
undertaking to assume greater equitably reduced if they are iniquitous or
unconscionable.
liability in case of breach (SSS vs.
Art. 2228. When the breach of the contract
Moonwalk).
committed by the defendant is not the one
contemplated by the parties in agreeing upon the
liquidated damages, the law shall determine the
measure of damages, and not the stipulation.

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Professor Ruben F. Balane Page 181 of 241
 or impliedly. The implied
right must be one 1. Payment or Performance (Articles 1232
ascertainable from the 1251)
nature of the obligation. An
example is in the Art. 1232. Payment means not
construction industry where only the delivery of money but also the
the contractor must pay the performance, in any other manner, of
penalty if the work is an obligation.
completed after the
stipulated time frame but Art. 1233. A debt shall not be
must also finish the agreed understood to have been paid unless
construction. the thing or service in which the
ii. Exclusive (Article 1226) obligation consists has been
General Rule: The penalty completely delivered or rendered, as
clause takes the place of the case may be.
other damages (thats why
in imposing a penalty Art. 1234. If the obligation has
clause, make sure that the been substantially performed in good
penalty is stiff). faith, the obligor may recover as
Exception: Both the though there had been a strict and
penalty and actual damages complete fulfillment, less damages
may be recovered in the suffered by the obligee.
following:
1. Express stipulation Art. 1235. When the obligee
2. Refusal by the debtor to accepts the performance, knowing its
pay the penalty incompleteness or irregularity, and
3. The debtor is guilty of without expressing any protest or
fraud (malice) in the objection, the obligation is deemed
performance of the fully complied with.
obligation.
In Pamintuan vs. Art. 1236. The creditor is not
CA, the Supreme bound to accept payment or
Court said that the performance by a third person who
excess of damages has no interest in the fulfillment of
absorbs the penalty. the obligation, unless there is a
Professor Balane stipulation to the contrary.
said that this is a Whoever pays for another may
wrong application. demand from the debtor what he has
You can demand paid, except that if he paid without the
both the excess and knowledge or against the will of the
the penalty. debtor, he can recover only insofar as
the payment has been beneficial to the
H. Extinguishment of Obligations debtor.

Art. 1231. Obligations are Art. 1237. Whoever pays on

extinguished: behalf of the debtor without the
(1) By payment or performance: knowledge or against the will of the
(2) By the loss of the thing due: latter, cannot compel the creditor to
(3) By the condonation or remission subrogate him in his rights, such as
of the debt; those arising from a mortgage,
(4) By the confusion or merger of guaranty, or penalty.
the rights of creditor and debtor;
(5) By compensation; Art. 1238. Payment made by a
(6) By novation. third person who does not intend to
Other causes of extinguishment of be reimbursed by the debtor is
obligations, such as annulment, deemed to be a donation, which
rescission, fulfillment of a resolutory requires the debtor's consent. But the
condition, and prescription, are governed payment is in any case valid as to the
elsewhere in this Code. creditor who has accepted it.

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Professor Ruben F. Balane Page 182 of 241
 money, shall be governed by the law of
Art. 1239. In obligations to sales.
give, payment made by one who does
not have the free disposal of the thing Art. 1246. When the obligation
due and capacity to alienate it shall consists in the delivery of an
not be valid, without prejudice to the indeterminate or generic thing, whose
provisions of article 1427 under the quality and circumstances have not
Title on "Natural Obligations." been stated, the creditor cannot
demand a thing of superior quality.
Art. 1240. Payment shall be Neither can the debtor deliver a thing
made to the person in whose favor the of inferior quality. The purpose of the
obligation has been constituted, or his obligation and other circumstances
successor in interest, or any person shall be taken into consideration.
authorized to receive it.
Art. 1247. Unless it is
Art. 1241. Payment to a person otherwise stipulated, the extrajudicial
who is incapacitated to administer his expenses required by the payment
property shall be valid if he has kept shall be for the account of the debtor.
the thing delivered, or insofar as the With regard to judicial costs, the
payment has been beneficial to him. Rules of Court shall govern.
Payment made to a third
person shall also be valid insofar as it Art. 1248. Unless there is an
has redounded to the benefit of the express stipulation to that effect, the
creditor. Such benefit to the creditor creditor cannot be compelled partially
need not be proved in the following to receive the prestations in which the
cases: obligation consists. Neither may the
(1) If after the payment, the debtor be required to make partial
third person acquires the payments.
creditor's rights; However, when the debt is in
(2) If the creditor ratifies the part liquidated and in part
payment to the third person; unliquidated, the creditor may
(3) If by the creditor's conduct, demand and the debtor may effect the
the debtor has been led to payment of the former without
believe that the third person waiting for the liquidation of the
had authority to receive the latter.
payment.
Art. 1249. The payment of
Art. 1242. Payment made in debts in money shall be made in the
good faith to any person in possession currency stipulated, and if it is not
of the credit shall release the debtor. possible to deliver such currency, then
in the currency which is legal tender
Art. 1243. Payment made to in the Philippines.
the creditor by the debtor after the The delivery of promissory
latter has been judicially ordered to notes payable to order, or bills of
retain the debt shall not be valid. exchange or other mercantile
documents shall produce the effect of
Art. 1244. The debtor of a payment only when they have been
thing cannot compel the creditor to cashed, or when through the fault of
receive a different one, although the the creditor they have been impaired.
latter may be of the same value as, or In the meantime, the action
more valuable than that which is due. derived from the original obligation
In obligations to do or not to shall be held in the abeyance.
do, an act or forbearance cannot be
substituted by another act or Art. 1250. In case an
forbearance against the obligee's will. extraordinary inflation or deflation of
the currency stipulated should
Art. 1245. Dation in payment, supervene, the value of the currency
whereby property is alienated to the at the time of the establishment of the
creditor in satisfaction of a debt in obligation shall be the basis of

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Professor Ruben F. Balane Page 183 of 241
 payment, unless there is an agreement a thing of superior quality.
to the contrary. However, the debtor cannot
give a thing of inferior
Art. 1251. Payment shall be quality (Article 1246).
made in the place designated in the The payment of debts in
obligation. money shall be made in the
There being no express currency stipulated, and if it
stipulation and if the undertaking is to not possible to deliver such
deliver a determinate thing, the currency, then in the
payment shall be made wherever the currency which is legal
thing might be at the moment the tender in the Philippines
obligation was constituted. (Article 1249, 1st ).
In any other case the place of R.A. No. 529 has been
payment shall be the domicile of the repealed by R.A. No. 8183
debtor. which allows payment in
If the debtor changes his different currency.
domicile in bad faith or after he has However, in the absence of
incurred in delay, the additional an agreement, payment
expenses shall be borne by him. shall be made in P.
These provisions are without Negotiable papers and
prejudice to venue under the Rules of other commercial
Court. documents can be refused
by the creditor unless there
Like obligee and creditor, payment and is stipulation to the
performance are twin terms. Payment contrary.
refers to obligations to give while If the negotiable papers and
performance refers to obligations to do. other commercial
Payment and performance is the documents are accepted by
paradigmatic mode. When obligations the creditor, it has only a
are entered into, the parties expect provisional effect. There is
payment or performance. All other payment only in the
modes of extinguishing obligations are following (Article 1249, 2nd
abnormal modes. ).
Requisites of Payment 1. When they have been
a. As to prestation honored and cashed; or
i. Identity 2. When through the fault
Identity means that the very of the creditor, they
prestation must be have been impaired
performed. In the case of NAMARCO,
For example, if the the check must be the check
obligation is to give a car,
one cannot fulfill the
Art. 1246. When the obligation consists in the
obligation pay giving a delivery of an indeterminate or generic thing, whose
house. quality and circumstances have not been stated, the
If the prestation is specific, creditor cannot demand a thing of superior quality.
the debtor must give or Neither can the debtor deliver a thing of inferior
deliver the specific thing quality. The purpose of the obligation and other
which was agreed upon circumstances shall be taken into consideration.
(Article 1244).
Art. 1249. The payment of debts in money shall be
If the prestation is generic, made in the currency stipulated, and if it is not
the creditor cannot demand possible to deliver such currency, then in the currency
which is legal tender in the Philippines.

Art. 1244. The debtor of a thing cannot compel the The delivery of promissory notes payable to
creditor to receive a different one, although the latter order, or bills of exchange or other mercantile
may be of the same value as, or more valuable than documents shall produce the effect of payment only
that which is due. when they have been cashed, or when through the
In obligations to do or not to do, an act or fault of the creditor they have been impaired.
forbearance cannot be substituted by another act or In the meantime, the action derived from the
forbearance against the obligee's will. original obligation shall be held in the abeyance.

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Professor Ruben F. Balane Page 184 of 241
 of another person, not a Identity means that the
party, before there will be entire prestation must be
impairment. performed completeness
For example, A gave B a (Article 1233)
check as payment for a loan. Exceptions to Integrity
B did not encash the check 1. Sub
as a result of which, the stantial compliance in
check became stale. There good faith (Article 1234)
is no impairment here. B
can still ask A for payment Art. 1234. If
of the loan. the obligation has
However, if B endorsed a been substantially
check made by A to C as performed in good
payment for a loan and C faith, the obligor
did not encash the check may recover as
which became stale, then C though there had
can no longer ask B to pay been a strict and
him again. complete
In the case of Pacific fulfillment, less
Timber, the Supreme Court damages suffered by
said that a certified check or the obligee.
a managers check is
considered as good as cash. 2. Wai
But newer cases say that ver (Article 1235)
such instruments are not
considered legal tender and Art. 1235.
thus, the creditor can refuse When the obligee
to accept. For example, A accepts the
gives B a managers check performance,
and bank closes for a bank knowing its
holiday. incompleteness or
Article 1250* was applied irregularity, and
only during the Japanese without expressing
occupation. any protest or
Exceptions to the objection, the
Requirement of Identity obligation is deemed
1. Dacion en pago (Article fully complied with.
1245)
3. In
Art. 1245. application of payments
Dation in payment, if the debts are equally
whereby property is onerous (Article 1254,
alienated to the 2nd )
creditor in
satisfaction of a debt Art. 1254, 2nd
in money, shall be . If the debts due
governed by the law are of the same
of sales. nature and burden,
the payment shall be
2. Novation applied to all of
ii. Integrity them
proportionately.

*
Art. 1250. In case an extraordinary inflation or
iii. Indivisibility
deflation of the currency stipulated should supervene,

the value of the currency at the time of the Art. 1233. A debt shall not be understood to have
establishment of the obligation shall be the basis of been paid unless the thing or service in which the
payment, unless there is an agreement to the obligation consists has been completely delivered or
contrary. rendered, as the case may be.

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Professor Ruben F. Balane Page 185 of 241
 Indivisibility means that the performance, it shall
obligor must perform the be divisible.
prestation in one act and
not in installments (Article 3. If the debt is liquidated
1248). The creditor can in part and unliquidated
validly refuse if the in part (Article 1248)
performance is not in one
act. Art. 1248.
Exceptions to Indivisibility Unless there is an
(Cases when the law allows express stipulation
installment performance) to that effect, the
1. In case of express creditor cannot be
stipulation (Article compelled partially
1248) to receive the
prestations in which
Art. 1248. the obligation
Unless there is an consists. Neither
express stipulation may the debtor be
to that effect, the required to make
creditor cannot be partial payments.
compelled partially However,
to receive the when the debt is in
prestations in which part liquidated and
the obligation in part unliquidated,
consists. Neither the creditor may
may the debtor be demand and the
required to make debtor may effect
partial payments. the payment of the
However, former without
when the debt is in waiting for the
part liquidated and liquidation of the
in part unliquidated, latter.
the creditor may
demand and the 4. In
debtor may effect joint divisible
the payment of the obligations (Article
former without 1208)
waiting for the
liquidation of the Art. 1208. If
latter. from the law, or the
nature or the
2. In prestations which wording of the
necessarily entail partial obligations to which
performance (Article the preceding article
1225, 2nd ) refers the contrary
does not appear, the
Art. 1225, 2nd credit or debt shall
. When the be presumed to be
obligation has for its divided into as many
object the execution shares as there are
of a certain number creditors or debtors,
of days of work, the the credits or debts
accomplishment of being considered
work by metrical distinct from one
units, or analogous another, subject to
things which by the Rules of Court
their nature are governing the
susceptible of partial multiplicity of suits.

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Professor Ruben F. Balane Page 186 of 241
 5. In each part having
solidary obligations been fixed, the sum
when the debtors are shall be paid at the
bound under different time and place of
terms and conditions delivery, in the
(Article 1211) absence if
stipulation.
Art. 1211.
Solidarity may exist 8. In
although the case of several
creditors and the guarantors who demand
debtors may not be the right of division
bound in the same (Article 2065)
manner and by the
same periods and Art. 2065.
conditions. Should there be
several guarantors
6. In of only one debtor
compensation where and for the same
there is a balance left debt, the obligation
(Article 1290) to answer for the
same is divided
Art. 1290. among all. The
When all the creditor cannot
requisites claim from the
mentioned in article guarantors except
1279 are present, the shares which
compensation takes they are respectively
effect by operation bound to pay, unless
of law, and solidarity has been
extinguishes both expressly stipulated.
debts to the The benefit of
concurrent amount, division against the
even though the co-guarantors
creditors and ceases in the same
debtors are not cases and for the
aware of the same reasons as the
compensation. benefit of excussion
against the principal
7. If debtor.
the work is to be
delivered partially, the 9. In
price or compensation case of impossibility or
for each part having extreme difficult of a
been fixed (Article single performance
1720) For example, A is
obligated to deliver
Art. 1720. 1 million bags of
The price or cement. Under the
compensation shall circumstances, this
be paid at the time may be extremely
and place of delivery difficult.
of the work, unless b. As to the parties
there is a stipulation i. Payor, Obligor, Debtor
to the contrary. If Who may be the Payor
the work is to be 1. Without the consent of
delivered partially, the creditor
the price or a. The debtor himself
compensation for

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Professor Ruben F. Balane Page 187 of 241
 b. The debtors heirs 2. Payment was without
or assigns the Debtors Consent
c. The debtors agent The 3rd person may
d. Anyone interested demand repayment
in the fulfillment of to the extent that
the obligation (e.g. the debtor has
guarantor) benefited (Article
2. With the consent of the 1236, 2nd ).
creditor ii. Payee, Obligee, Creditor
Anyone can pay if Who may be the Payee
the creditor 1. The creditor himself
consents (Articles 1240, 1626)
Effect of Payment by a 3 rd 2. The creditors successor
Person or transferee (Article
1. Payment was with the 1240)
Debtors Consent 3. The creditors agent
General Rule: (Article 1240)
The payor steps into 4. Any third person
the shoes of the subject to the following
creditor and conditions:
becomes entitled a. Provided it
not only to recover redounded to the
what he has paid, creditors benefit
but also to exercise and only to the
all the rights which extent of such
the creditor could benefit (Article
have exercised 1241, 2nd par)
subrogation b. If it falls under
(Articles 1236, Article 1241 2 (1),
1237). (2) and (3), the
There is no benefit is total.
extinguishment 5. Anyone in possession of
of the the credit (Article
obligation but a 1242)
change in the
active subject.
consent. But the payment is in any case valid as to the
Exception: No
creditor who has accepted it.
subrogation if
Art. 1240. Payment shall be made to the person in
intended to be a
whose favor the obligation has been constituted, or his
donation (Article
successor in interest, or any person authorized to
1238). receive it.
Art. 1626. The debtor who, before having
knowledge of the assignment, pays his creditor shall
Art. 1236. The creditor is not bound to accept
payment or performance by a third person who has no be released from the obligation.

interest in the fulfillment of the obligation, unless there Art. 1241. Payment to a person who is
is a stipulation to the contrary. incapacitated to administer his property shall be valid
Whoever pays for another may demand from if he has kept the thing delivered, or insofar as the
the debtor what he has paid, except that if he paid payment has been beneficial to him.
without the knowledge or against the will of the Payment made to a third person shall also be valid
debtor, he can recover only insofar as the payment has insofar as it has redounded to the benefit of the
been beneficial to the debtor. creditor. Such benefit to the creditor need not be
Art. 1237. Whoever pays on behalf of the proved in the following cases:
debtor without the knowledge or against the will of the (1) If after the payment, the third person acquires
latter, cannot compel the creditor to subrogate him in the creditor's rights;
his rights, such as those arising from a mortgage, (2) If the creditor ratifies the payment to the third
guaranty, or penalty. person;

Art. 1238. Payment made by a third person who (3) If by the creditor's conduct, the debtor has
does not intend to be reimbursed by the debtor is been led to believe that the third person had
deemed to be a donation, which requires the debtor's authority to receive the payment.

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Professor Ruben F. Balane Page 188 of 241
 6. In all these 5 instances, Secondary Rule: Place
it is required that the where the thing was at the
debt should not be time the obligation was
garnished (Article constituted if the obligation
1242). If there is is to deliver a determinate
payment despite thing
garnishment, then there Tertiary Rule: Debtors
is no payment. domicile (not residence)
c. As to the time and place of 4 Special Forms of Payment
performance a. Dacion en pago (Article 1245)
i. When Payment Should be Made
Payment should be made Art. 1245. Dation in
when it is due. payment, whereby property is
Even if the payment is due, alienated to the creditor in
the General Rule is that satisfaction of a debt in money,
demand is still necessary. shall be governed by the law of
Article 1169 provides the sales.
instances when demand is
not necessary Dacion en pago is the act of
1. Wh extinguishing the obligation by
en the obligation or the the substitution of payment. It
law expressly so is the delivery and transmission
declares of ownership of a thing by the
2. Tim debtor to the creditor as an
e is the controlling accepted performance/payment
motive for the of an obligation.
establishment of the By agreement of the parties, the
contract prestation is changed.
3. De Dacion en pago is a special form
mand would be useless of payment since it does not
ii. Where Payment Should be comply with the requisite of
Made: identity.
Primary Rule: Other terms for dacion en pago
Agreement of the parties include dation in payment,
dation en paiement and datio in
Art. 1242. Payment made in good faith to any
solutum.
person in possession of the credit shall release the
debtor. Dacion en pago is governed by
the law on sales (Article 1245).
Art. 1169. Those obliged to deliver or to do
There are 2 ways of looking at
something incur in delay from the time the obligee
dacion en pago. The traditional
judicially or extrajudicially demands from them the
fulfillment of their obligation.
way is to view dacion en pago as
However, the demand by the creditor shall not a sale.
be necessary in order that delay may exist: Example: A owes B P100,000.
(1) When the obligation or the law expressly so A has no cash when the loan
declare; or falls due but he offers the car if
(2) When from the nature and the circumstances B wants it. B accepts.
of the obligation it appears that the Here, the debt is in money but
designation of the time when the thing is to be payment is in something else.
delivered or the service is to be rendered was According to the old traditional
a controlling motive for the establishment of concept, it is like a sale because
the contract; or P100,000 seemed to be the
(3) When demand would be useless, as when the purchase price and the car is the
obligor has rendered it beyond his power to object.
perform. However, the modern view is to
In reciprocal obligations, neither party incurs in look at dacion en pago as a
delay if the other does not comply or is not ready to
novation.
comply in a proper manner with what is incumbent
upon him. From the moment one of the parties fulfills
Castan has another view of
his obligation, delay by the other begins. dacion en pago. He believes

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Professor Ruben F. Balane Page 189 of 241
 that it is neither a sale nor a the payment shall be applied to
novation but a special form of all of them proportionately.
payment. It is a
species/variation of payment Application payment is the
implying an onerous transaction designation of the debt which is
similar to but not equal to a sale. being paid by a debtor who has
It is not novation since there is several obligations of the same
no new obligation. kind in favor of the creditor to
Dacion en pago will take place whom payment is made.
only if the parties consent. The situation in application of
Dacion en pago extinguishes payments is that a debtor owes
the obligation up to the value of his creditor. There are several
the thing delivered unless the debts due, but the debtor cannot
parties agree that the entire pay all of the debts due.
obligation is extinguished Example: A owes B P2000,
(Lopez vs. CA). P3000 and P10,000. A gives B
b. Application of payments P15,000. There is no
(Articles 1252-1254) application of payment here
because it is equal to the total
Art. 1252. He who has amount due.
various debts of the same kind The creditor can always not
in favor of one and the same accept application of payments
creditor, may declare at the since the creditor cannot be
time of making the payment, to compelled to accept partial
which of them the same must performance of the obligation.
be applied. Unless the parties However, this may not be wise
so stipulate, or when the since the debtor may have other
application of payment is made creditors.
by the party for whose benefit The rules on application of
the term has been constituted, payment solve the problem of
application shall not be made distributing the payment which
as to debts which are not yet is less than the total obligation.
due. Rules in Application of Payment
If the debtor accepts 1st Rule: Apply in
from the creditor a receipt in accordance with the
which an application of the agreement
payment is made, the former
2nd Rule: If there is no
cannot complain of the same,
agreement, the debtor has
unless there is a cause for
the right to apply
invalidating the contract.
3rd Rule: If the debtor does
Art. 1253. If the debt not choose, the creditor can
choose.
produces interest, payment of
the principal shall not be 4th Rule: Apply to the most
deemed to have been made onerous debt (Article 1254,
until the interests have been 1)
covered. Rules to Determine
Which is the More
Art. 1254. When the Onerous Obligation
payment cannot be applied in i. An interest bearing
accordance with the preceding obligation is more
rules, or if application can not onerous than a non-
be inferred from other interest bearing
circumstances, the debt which obligation.
is most onerous to the debtor, ii. An older debt is
among those due, shall be more onerous than
deemed to have been satisfied. a recent debt
If the debts due are of iii. An obligation where
the same nature and burden, the party is bound

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Professor Ruben F. Balane Page 190 of 241
 as a principal is performance integrity. In
more onerous than most cases, there will be a
an obligation is balance due.
bound as a surety Payment by Cession
iv. An obligation which Distinguished from Dacion en
is secured is more Pago
onerous than an In dacion en pago, there is a
obligation which is transfer of ownership from
unsecured the debtor to the creditor.
v. An obligation with a In payment by cesion, there
penal clause is more is no transfer of ownership.
onerous than an The creditors simply acquire
obligation without a the right to sell the
penal clause properties of the debtor and
5th Rule: If equally apply the proceeds of the
onerous, apply sale to the satisfaction of
proportionately (Article their credit.
1254, 2) Payment by cession does
c. Payment by cession (Article not generally terminate all
1255) debts due since normally
there is still a balance due.
Art. 1255. The debtor The balance will continue to
may cede or assign his be due unless the parties
property to his creditors in agree otherwise. Usually,
payment of his debts. This the termination is only to
cession, unless there is the extent of the net
stipulation to the contrary, proceeds. The
shall only release the debtor extinguishment of the
from responsibility for the net obligation is pro tanto.
proceeds of the thing assigned. Payment by cession must be
The agreements which, on the distinguished from insolvency.
effect of the cession, are made 2 Kinds of Insolvency
between the debtor and his i. Extrajudicial or
creditors shall be governed by Voluntary
special laws. In extrajudicial
insolvency, if there
The situation is contemplated is a balance left, the
here is that the debtor has debtor must still
several creditors and several pay.
debts. He turns over property to However, the
his creditors who are given the debtor may limit
authority to sell the property which properties
and to apply the proceeds to his will be sold by the
debt. creditors since the
In payment by cession, property agreement is
is turned over by the debtor to contractual.
the creditors who acquire the ii. Judicial
right to sell it and divide the net In judicial
proceeds among themselves. insolvency, the
In payment by cession, the obligation is totally
creditors do not own the extinguished even if
property to be sold. The theres still a
creditors only have the power to balance.
sell. The net proceeds of the In judicial
sale will be distributed insolvency, every
according to the agreement. property which is
Payment by cession is a special not exempt from
form of payment because there attachment or
is no completeness of

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Professor Ruben F. Balane Page 191 of 241
 execution is made
available for sale. Art. 1259. The expenses
d. Tender of payment and of consignation, when properly
consignation (Article 1256-1261) made, shall be charged against
the creditor.
Art. 1256. If the
creditor to whom tender of Art. 1260. Once the
payment has been made consignation has been duly
refuses without just cause to made, the debtor may ask the
accept it, the debtor shall be judge to order the cancellation
released from responsibility by of the obligation.
the consignation of the thing or Before the creditor has
sum due. accepted the consignation, or
Consignation alone before a judicial declaration
shall produce the same effect that the consignation has been
in the following cases: properly made, the debtor may
(1) When the creditor is withdraw the thing or the sum
absent or unknown, or deposited, allowing the
does not appear at the obligation to remain in force.
place of payment;
(2) When he is Art. 1261. If, the
incapacitated to consignation having been
receive the payment at made, the creditor should
the time it is due; authorize the debtor to
(3) When, without just withdraw the same, he shall
cause, he refuses to lose every preference which he
give a receipt; may have over the thing. The
(4) When two or more co-debtors, guarantors and
persons claim the sureties shall be released.
same right to collect;
(5) When the title of the Consignation is the act of
obligation has been depositing the thing due w/ the
lost. court or judicial authorities
whenever the creditor cannot
Art. 1257. In order that accept or refuses to accept
the consignation of the thing payment and it generally
due may release the obligor, it requires a prior tender of
must first be announced to the payment.
persons interested in the It is defined in the case of Soco
fulfillment of the obligation. vs. Militante as a deposit of the
The consignation shall object of the prestation in a
be ineffectual if it is not made competent court in accordance
strictly in consonance with the with the rules prescribed by law,
provisions which regulate after tender of payment was
payment. refused or circumstances which
render payment impossible or
Art. 1258. Consignation inadvisable.
shall be made by depositing the According to Professor Balane,
things due at the disposal of the title of the subsection is
judicial authority, before wrong. It should have been
whom the tender of payment consignation only because that
shall be proved, in a proper is the special mode of payment
case, and the announcement of and not the tender of payment.
the consignation in other Tender of payment is a
cases. manifestation made by the
The consignation having debtor of his willingness,
been made, the interested readiness and ability to pay.
parties shall also be notified It is a special mode of payment
thereof. because payment is made not to

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Professor Ruben F. Balane Page 192 of 241
 the creditor but to the court. c. The creditor,
without just
Consignation is an option on the cause refuses to
part of the debtor because give a receipt
consignation assumes that the According
creditor was in mora accipiendi to Professor
when the creditor without just Balane, this
cause, refuses to accept is wrong.
payment. Of course, if the This is not a
creditor without just cause special case
refuses to accept payment, the wherein
debtor may just delay payment. you dont
But something still hangs above need tender
his head. He is therefore, given of payment.
the option to consign. This
Requisites: presuppose
i. That there was a debt due s that there
ii. That the consignation of the has been a
obligation had been made prior tender
because of some legal cause, of payment.
either because d. Several persons
1. Tender of payment was claimed to be
unjustly refused by the entitled to
creditor or receive the
2. There is no need for amount due
tender of payment due The debtor
to circumstances which should file
make tender of payment interpleade
impossible or r with
inadvisable consignatio
Circumstances n
Which Make Tender e. The title of the
of Payment obligation has
Unnecessary been lost
(Article 1256) iii. That previous notice of the
a. The creditor consignation had been given
was absent or to the person interested in
unknown, or the performance of the
does not appear obligation (Article 1257)
at the place of iv. That the amount due was
payment placed at the disposal of the
b. The creditor court
was (consignation proper)
incapacitated to v. That after the consignation
receive the had been made the person
payment at the interested was notified
time it was due thereof (second notice.)
Payment Failure of any of these
made to an requirements is enough
incapacitate ground to render a
d person consignation ineffective.
does not 2. Loss of the Thing Due (Articles 1262-
count 1269)
except to
the extent Art. 1262. An obligation which
that the consists in the delivery of a
incapacitate determinate thing shall be
d person is extinguished if it should be lost or
benefited. destroyed without the fault of the

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Professor Ruben F. Balane Page 193 of 241
 debtor, and before he has incurred in Loss of the thing here is not to be taken
delay. in the strict legal meaning of loss.
When by law or stipulation, the Loss can be applied in an obligation to
obligor is liable even for fortuitous give a determinate thing (Article 1262),
events, the loss of the thing does not in an obligation to give a generic thing
extinguish the obligation, and he shall (Article 1263) and in an obligation to do
be responsible for damages. The same (Article 1266).
rule applies when the nature of the The term loss embraces all causes which
obligation requires the assumption of may render impossible the performance
risk. of the prestations impossibility of
performance .
Art. 1263. In an obligation to A thing is lost when it perishes, or goes
deliver a generic thing, the loss or out of commerce, or disappears in such
destruction of anything of the same a way that its existence is unknown or it
kind does not extinguish the cannot be recovered.
obligation. When the debt of a thing certain and
determinate proceeds from a criminal
Art. 1264. The courts shall offense, the debtor shall not be
determine whether, under the exempted from the payment of its price,
circumstances, the partial loss of the whatever may be the cause for the loss,
object of the obligation is so unless the thing having been offered by
important as to extinguish the him to the person who should receive it,
obligation. the latter refused without justification to
accept it (Article 1268).
Art. 1265. Whenever the thing Kinds of Impossibility According to
is lost in the possession of the debtor, Time
it shall be presumed that the loss was a. Original Impossibility
due to his fault, unless there is proof
If the impossibility had already
to the contrary, and without prejudice
existed when the contract was
to the provisions of article 1165. This
made, then the result is not
presumption does not apply in case of
extinguishments but inefficacy
earthquake, flood, storm, or other
of the obligation under Articles
natural calamity.
1348 and 1493. The contract is
void.
Art. 1266. The debtor in
b. Supervening Impossibility
obligations to do shall also be released
when the prestation becomes legally The impossibility of
or physically impossible without the performance must be
fault of the obligor. subsequent to the execution of
the contract in order to
Art. 1268. When the debt of a extinguish the obligation.
thing certain and determinate Change in the
proceeds from a criminal offense, the Circumstances
debtor shall not be exempted from the Rebus sic stantibus literally
payment of its price, whatever may be means things as they
the cause for the loss, unless the thing stand. It is short for
having been offered by him to the clausula rebus sic stantibus
person who should receive it, the agreement of things as
latter refused without justification to

accept it. Art. 1348. Impossible things or services cannot be
the object of contracts.
Art. 1269. The obligation Art. 1493. If at the time the contract of sale is
having been extinguished by the loss perfected, the thing which is the object of the contract
of the thing, the creditor shall have all has been entirely lost, the contract shall be without
the rights of action which the debtor any effect.
may have against third persons by But if the thing should have been lost in part
reason of the loss. only, the vendee may choose between withdrawing
from the contract and demanding the remaining part,
paying its price in proportion to the total sum agreed
upon.

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Professor Ruben F. Balane Page 194 of 241
 they stand. Also called commercial object or
Riesgo imprevisible enterprise.
(Spanish), Theorie The attitude of the courts on
dimprevision (French) and this doctrine is very strict.
Verschuvinden des This principle has always
Grundgeschftes (German). been strictly applied. To
give it a liberal application
Art. 1267. When is to undermine the binding
the service has become force of an obligation.
so difficult as to be Every obligation is difficult.
manifestly beyond the The performance must be
contemplation of the extremely difficult in order
parties, the obligor may for rebus sic stantibus to
also be released apply.
therefrom, in whole or Requisites
in part. i. The event or change
could not have been
In Roman law, no matter foreseen at the time of
how difficult the obligation the execution of the
is, it has to be performed or contract
else the obligor may be ii. The event or change
liable for damages (pacta makes the performance
sunt servanda). In extremely difficult but
Medieval times, although not impossible
agreements should be iii. The event must not be
complied with, in certain due to an act of either
extreme circumstances, the party
debtor can be released iv. The contract is for a
because of the difficulty in future prestation.
performance. If the contract is of
This is a principle of immediate fulfillment, the
international law which gross inequality of the
holds that when 2 states reciprocal prestation may
enter into a treaty, they involve lesion or want of
enter taking into account cause.
the circumstances at the Obligation to Give
time it was entered into and a. Obligation to give a determinate
should the circumstances thing
change as to make the The happening of a fortuitous
fulfillment of the treaty very event in itself does not
difficult, one may ask for a necessarily extinguish an
termination of the treaty. obligation to deliver a
This principle of determinate thing. An
international law has spilled obligation consisting in the
over into Civil law. delivery of a specified thing,
The underlying philosophy shall be extinguished when the
here is that when parties said thing is lost or destroyed
enter into an agreement, the without the fault of the obligor
parties contemplate existing and before he is in default.
circumstances. When Whenever the thing is lost in the
things supervene, the possession of the debtor, it shall
parties may be discharged be presumed that the loss was
because they did not due to his fault, unless there is
contemplate such difficult proof to the contrary, and
circumstances. without prejudice to the
This doctrine is also called provisions of Article 1165. This
the doctrine of extreme presumption does not apply in
difficulty and frustration of case of earthquake, flood, storm

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Professor Ruben F. Balane Page 195 of 241
 or other natural calamity subjective impossibility is a
(Article 1265) cause for extinguishes a very
b. Obligation to give a generic thing personal obligation but not
The happening of a fortuitous an obligation which is not
event does not extinguish the very personal.
obligation to deliver a generic Effect of Loss on Creditors Rights
thing Genus nunquam perit The obligation having been
genus never perishes. This is extinguished by the loss of the thing,
the general rule. Sometimes, the creditor shall have all the rights
though, the entire genus of action which the debtor may have
perishes because it becomes against the third person by reason of
illegal. the loss.
What is not covered by this rule A common example of this is
is an obligation to deliver a insurance.
limited generic. 3. Condonation or Remission of the Due
Example: I promise to deliver
to you one of my Amorsolos (I Art. 1270. Condonation or
have 4). This is not generic remission is essentially gratuitous,
because I only have four but not and requires the acceptance by the
specific because I did not specify obligor. It may be made expressly or
which one. This is governed by impliedly.
Article 1262. In this case, the One and the other kind shall be
obligation may be extinguished subject to the rules which govern
by the loss of all the things inofficious donations. Express
through fortuitous event. condonation shall, furthermore,
Obligation to do comply with the forms of donation.
The debtor in obligations to do shall
also be released when the prestation Art. 1271. The delivery of a
becomes legally or physically private document evidencing a credit,
impossible without the fault of the made voluntarily by the creditor to the
obligor (Article 1266). debtor, implies the renunciation of
The impossibility here must be the action which the former had
supervening. If it is original, then against the latter.
the contract is void. If in order to nullify this waiver
Kinds of Impossibility According to it should be claimed to be inofficious,
Nature the debtor and his heirs may uphold it
a. Objective Impossibility by proving that the delivery of the
In objective impossibility, the document was made in virtue of
act cannot be done by anyone. payment of the debt.
The effect of objective
impossibility is to extinguish the Art. 1272. Whenever the
obligation. private document in which the debt
b. Subjective Impossibility appears is found in the possession of
In subjective impossibility, the the debtor, it shall be presumed that
obligation becomes impossible the creditor delivered it voluntarily,
only w/ respect to the obligor. unless the contrary is proved.
There are 3 views as to the effect
of a subjective impossibility: Art. 1273. The renunciation of
i The obligation is not the principal debt shall extinguish the
extinguished. The obligor accessory obligations; but the waiver
should ask another to do the of the latter shall leave the former in
obligation. force.
ii. The obligation is
extinguished. Art. 1274. It is presumed that
iii. A third view distinguishes the accessory obligation of pledge has
one prestation which is very been remitted when the thing pledged,
personal and one which are after its delivery to the creditor, is
not personal such that found in the possession of the debtor,

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 or of a third person who owns the b. If the renunciation is implied, then
thing. it is tantamount to a waiver.
There is no prescribed form in a
Condonation or remission is an act of waiver (Article 6*). For example,
liberality by virtue of which, without the creditor can just refuse to
receiving any equivalent, the creditor collect the debt.
renounces enforcement of an obligation According to Professor Balane,
which is extinguished in whole or in Articles 1271 and 1272 refer to a
part. kind of implied renunciation
Requisites when the creditor divests
a. The debt must be existing himself of the proof credit.
You can remit a debt even The delivery of a private
before it is due. document, evidencing a credit,
Example: I owe A P1M. I made voluntarily by the creditor
promised to pay on July 31, to the debtor, implies the
2002 with interest. On May 31, renunciation of the action which
A condones the obligation. The the former had against the
obligation is existing but not yet latter.
due but it can be condoned. If in order to nullify this waiver
b. The renunciation must be gratuitous it should be claimed to be
If renunciation is for a inofficious, the debtor and his
consideration, the mode of heirs may uphold it by providing
extinguishment may be that the delivery of the
something else. It may be document was made in virtue of
novation, compromise or payment of the debt (Article
dacion en pago for example. 1271).
c. There must be acceptance by the Article 1271 has no
debtor application to public
d. The parties must have capacity documents because there is
The creditor must have capacity always a copy in the
to give away. archives which can be used
The debtor must have capacity to prove the credit. Private
to accept. document refers to the
Form original in order for Article
a. If the renunciation is express, then it 1271 to apply.
is a donation. By delivering the private
The form of donation must be document, the creditor
observed. If the condonation deprives himself of proof.
involves movables, apply Article
748. If it involves immovables, If the acceptance is made in a separate
apply Article 749. instrument, the donor shall be notified thereof in an
authentic form, and this step shall be noted in both

Art. 748. The donation of a movable may be made instruments.

*
orally or in writing. Art. 6. Rights may be waived, unless the waiver is
An oral donation requires the simultaneous contrary to law, public order, public policy, morals, or
delivery of the thing or of the document representing good customs, or prejudicial to a third person with a
the right donated. right recognized by law.

If the value of the personal property donated Art. 1271. The delivery of a private document
exceeds five thousand pesos, the donation and the evidencing a credit, made voluntarily by the creditor to
acceptance shall be made in writing, otherwise, the the debtor, implies the renunciation of the action which
donation shall be void. (632a) the former had against the latter.
Art. 749. In order that the donation of an If in order to nullify this waiver it should be
immovable may be valid, it must be made in a public claimed to be inofficious, the debtor and his heirs may
document, specifying therein the property donated and uphold it by proving that the delivery of the document
the value of the charges which the donee must satisfy. was made in virtue of payment of the debt. (1188)
The acceptance may be made in the same Art. 1272. Whenever the private document in
deed of donation or in a separate public document, but which the debt appears is found in the possession of
it shall not take effect unless it is done during the the debtor, it shall be presumed that the creditor
lifetime of the donor. delivered it voluntarily, unless the contrary is proved.

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Professor Ruben F. Balane Page 197 of 241
 The second paragraph of the creditor they cannot be
Article 1271 implies that the subrogated to the rights, mortgages,
voluntary return of the title and preferences of the latter (Article
of credit is presumed to be 2080).
by reason of remission and It is presumed that the accessory
not by reason of the obligation of pledge has been
payment of debt. According remitted when the thing pledged,
to Professor Balane, this is after its delivery to the creditor, is
anomalous. This provision found in the possession of the
is absurd and immoral in debtor, or of a third person who
that it authorizes the debtor owns the thing (Article 1274).
and his heirs to prove that According to Professor Balane,
they paid the debt, when the the accessory obligation of
provision itself assumes that pledge is extinguished because
there has been a remission, pledge is a possessory lien. The
which is gratuitous. presumption in this case is that
Whenever the private document the pledgee has surrendered the
in which the debt appears is thing pledged to the pledgor.
found in the possession of the However, this is not a
debtor, it shall be presumed that conclusive presumption
the creditor delivered it according to Article 2110, 2.
voluntarily, unless the contrary This presumption is not
is proved (Article 1272). applicable in a mortgage since
2 Presumptions: there is no possessory lien.
i. If a private document is In addition to the requisites
found in the possession of prescribed in article 2085, it is
the debtor, then it is necessary, in order to constitute the
presumed that the creditor contract of pledge, that the thing
voluntarily delivered it to pledged be placed in the possession
him of the creditor, or of a third person
ii. Since the creditor by common agreement (Article
voluntarily delivered the 2093)
private document, then The debtor cannot ask for the return
there is a presumption of of the thing pledged against the will
remission of the creditor, unless and until he
Ways of Remission has paid the debt and its interest,
a. By will with expenses in a proper case
b. By agreement (Article 2105).
Effect of Partial Remission 4. Confusion or Merger of Rights
The renunciation of the principal
debt shall extinguish the accessory Art. 1275. The obligation is
obligations; but the waiver of the extinguished from the time the
latter shall leave the former in force characters of creditor and debtor are
(Article 1273). merged in the same person.
Example: Loan secured by a
mortgage. If I condone the loan, I Art. 1276. Merger which takes
condone the mortgage. But if I place in the person of the principal
condone the mortgage, I do not debtor or creditor benefits the
condone the loan which merely guarantors. Confusion which takes
becomes unsecured. place in the person of any of the latter
The obligation of the guarantor is does not extinguish the obligation.
extinguished at the same time as
that of the debtor, and for the same Art. 1277. Confusion does not
causes as all other obligations extinguish a joint obligation except as
(Article 2076). regards the share corresponding to
The guarantors, even though they be the creditor or debtor in whom the
solidary, are released from their two characters concur.
obligation whenever by some act of

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Professor Ruben F. Balane Page 198 of 241
 Confusion is the meeting in one person things due are consumable,
of the qualities of the creditor and they be of the same kind, and
debtor with respect to the same also of the same quality if the
obligation. latter has been stated;
Confusion or merger of rights (3) That the two debts be due;
extinguishes the obligation because the (4) That they be liquidated and
creditor becomes his own debtor. demandable;
Therefore, how can the creditor sue (5) That over neither of them
himself. there be any retention or
Requisites of Confusion controversy, commenced by
a. It must take place between the third persons and
creditor and the principal debtor communicated in due time to
(Article 1276) the debtor.
A borrowed P 1M from B with C
as guarantor. If C acquires the Art. 1280. Notwithstanding the
right to collect the P 1M, there is provisions of the preceding article,
no confusion since C is neither a the guarantor may set up
principal debtor or creditor. compensation as regards what the
The effect is that the guaranty is creditor may owe the principal
extinguished. The principal debtor.
obligation remains.
b. The very same obligation must be Art. 1281. Compensation may
involved (Article 1275) be total or partial. When the two debts
Usual Causes of Confusion are of the same amount, there is a
a. Succession (compulsory, testate, total compensation.
intestate)
b. Donation Art. 1282. The parties may
c. Negotiation of a negotiable agree upon the compensation of debts
instrument which are not yet due.
Confusion can overlap with remission or
Art. 1283. If one of the parties
payment.
to a suit over an obligation has a claim
Example of confusion overlapping with
for damages against the other, the
remission: X owes O P100,000. O
former may set it off by proving his
bequeath to X that credit. And then she
right to said damages and the amount
died. In this case, there is
thereof.
extinguishment both by merger. But in
this case, merger could overlap with
Art. 1284. When one or both
remission.
debts are rescissible or voidable, they
Example of confusion overlapping with
may be compensated against each
payment. A makes a promissory note
other before they are judicially
and endorses it to B. B endorsed it to C.
rescinded or avoided.
C to D. D endorsed it back to A.
5. Compensation
Art. 1285. The debtor who has
consented to the assignment of rights
Art. 1278. Compensation shall
made by a creditor in favor of a third
take place when two persons, in their
person, cannot set up against the
own right, are creditors and debtors
assignee the compensation which
of each other.
would pertain to him against the
assignor, unless the assignor was
Art. 1279. In order that
notified by the debtor at the time he
compensation may be proper, it is
gave his consent, that he reserved his
necessary:
right to the compensation.
(1) That each one of the obligors
If the creditor communicated
be bound principally, and
the cession to him but the debtor did
that he be at the same time a
not consent thereto, the latter may set
principal creditor of the
up the compensation of debts
other;
previous to the cession, but not of
(2) That both debts consist in a
subsequent ones.
sum of money, or if the

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Professor Ruben F. Balane Page 199 of 241
 If the assignment is made In compensation, there are 2 parties
without the knowledge of the debtor, and 2 debts, whereas in confusion,
he may set up the compensation of all there are 2 debts and only 1 party.
credits prior to the same and also Kinds of Compensation
later ones until he had knowledge of a. Legal (Article 1279)
the assignment. Legal compensation takes place
automatically by operation of
Art. 1286. Compensation takes law once all the requisites under
place by operation of law, even though Article 1279 are present.
the debts may be payable at different Requisites
places, but there shall be an i. The parties must be
indemnity for expenses of exchange or mutually debtors and
transportation to the place of creditors of each other in
payment. their own right and as
principals.
Art. 1287. Compensation shall There can be no
not be proper when one of the debts compensation if 1 party
arises from a depositum or from the occupies only a
obligations of a depositary or of a representative capacity
bailee in commodatum. (i.e. agent). Likewise,
Neither can compensation be there can be no
set up against a creditor who has a compensation if in one
claim for support due by gratuitous obligation, a party is a
title, without prejudice to the principal obligor and in
provisions of paragraph 2 of article another obligation, he is
301. a guarantor.
ii. The things due must be
Art. 1288. Neither shall there fungible
be compensation if one of the debts
Article 1279 uses the
consists in civil liability arising from a
word consumable.
penal offense.
This is wrong. The
proper terminology is
Art. 1289. If a person should
fungible which refers
have against him several debts which
to things of the same
are susceptible of compensation, the
kind which in payment
rules on the application of payments
can be substituted for
shall apply to the order of the
another.
compensation.
iii. The 2 debts must be due
iv. The 2 debts must be
Art. 1290. When all the
liquidated and demandable
requisites mentioned in article 1279
Demandable means that
are present, compensation takes
the debts are
effect by operation of law, and
enforceable in court,
extinguishes both debts to the
there being no apparent
concurrent amount, even though the
defenses inherent in
creditors and debtors are not aware of
them. The obligations
the compensation.
must be civil
obligations, excluding
Compensation is a mode of
those that are purely
extinguishing, to the concurrent
natural. Before a
amount, the obligations of those persons
judicial decree of
who in their own right are reciprocally
rescission or
debtors and creditors of each other.
annulment, a rescissible
Perhaps, next to payment, compensation or voidable debt is valid
is the most common mode of and demandable; hence,
extinguishing an obligation. it can be compensated.
Compensation Distinguished from A debt is liquidated
Confusion when its existence and

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Professor Ruben F. Balane Page 200 of 241
 amount are determined. Compensation shall not be
And a debt is proper when one of the debts
considered liquidated, arises from a depositum or from
not only when it is the obligations of a depositary
expressed already in or of a bailee in commodatum.
definite figures w/c do Neither can compensation be
not require verification, set up against a creditor who
but also when the has a claim for support due by
determination of the gratuitous title, without
exact amount depends prejudice to the provisions of
only on a simple paragraph 2 of article 301
arithmetical operation. (Article 1287)
v. Neither of the debts must The prohibition of
not be garnished compensation when one of
vi. Compensation must not be the debts arises from a
prohibited by law depositum or commodatum
Articles 1287, 1288 and is based on justice. A
1794 are examples of deposit is made or a
when legal commodatum is given on
compensation is not the basis of confidence in
allowed. the depositary or the
Legal compensation is borrower. It is therefore, a
not allowed when there matter of morality, that the
is conventional or depositary or the borrower
facultative should in fact perform his
compensation. obligation; otherwise, the
Effect of Legal Compensation trust or confidence of the
If a person should have depositor or lender would
against him several debts be violated.
which are susceptible of With respect to future
compensation, the rules on support, to allow its
the application of payments extinguishments by
shall apply to the order of compensation would defeat
the compensation (Article its exemption from
1289) attachment and execution
When all the requisites (Article 205, Family Code)
mentioned in article 1279 and may expose the
are present, compensation recipient to misery and
takes effect by operation of starvation. However,
law, and extinguishes both support in arrears can be
debts to the concurrent compensated.
amount, even though the The depositary cannot set
creditors and debtors are up compensation w/ respect
not aware of the to the things deposited to
compensation (Article 1290) him. But the depositor can
b. Facultative (Articles 1287, 1288) set up the compensation.
Facultative compensation takes Example: A is a
place when compensation is warehouseman. B deposits
claimable by only one of the 1000 quedans of rice with
parties but not of the other. A. B also owes A 1000 kilos
of rice. A cannot claim

Art. 1794. Every partner is responsible to the compensation but B can set
partnership for damages suffered by it through his up compensation.
fault, and he cannot compensate them with the profits Neither shall there be
and benefits which he may have earned for the compensation if one of the debts
partnership by his industry. However, the courts may consists in civil liability arising
equitably lessen this responsibility if through the from a penal offense (Article
partner's extraordinary efforts in other activities of the 1288)
partnership, unusual profits have been realized.

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Professor Ruben F. Balane Page 201 of 241
 If 1 of the debts consists in It depends:
civil liability arising from a a. If the assignment is with the
penal offense, compensation debtors (Bs) consent
would be improper and Debtor cannot set up
inadvisable because the compensation at all unless the
satisfaction of such right is reserved.
obligation is imperative. b. If the assignment is with the
The person who has the civil debtors (Bs) knowledge but
liability arising from the without consent
crime cannot set up The debtor can set up
compensation. However, compensation with a credit
the offended party is already existing at the time of
entitled to set up the assignment.
compensation. c. If the assignment is without the
c. Conventional or Contractual debtors (Bs) knowledge
(Article 1282) Debtor can set up as
Contractual or conventional compensation any credit
compensation takes place when existing at the time he acquired
parties agree to set-off even if knowledge even if it arose after
the requisites of legal the actual assignment.
compensation are not present. 6. Novation
The parties may agree upon the
compensation of debts which Art. 1291. Obligations may be
are not yet due. modified by:
The parties may compensate by (1) Changing their object or
agreement any obligations, in principal conditions;
w/c the objective requisites (2) Substituting the person of the
provided for legal compensation debtor;
are not present. (3) Subrogating a third person in
d. Judicial (Article 1283) the rights of the creditor.
Judicial compensation is
compensation decreed by the Art. 1292. In order that an
court in a case where there is a obligation may be extinguished by
counterclaim. another which substitute the same, it
If one of the parties to a suit is imperative that it be so declared in
over an obligation has a claim unequivocal terms, or that the old and
for damages against the other, the new obligations be on every point
the former may set it off by incompatible with each other.
proving his right to said
damages and the amount Art. 1293. Novation which
thereof. consists in substituting a new debtor
Effect of Assignment (Article 1285) in the place of the original one, may be
Situation: made even without the knowledge or
against the will of the latter, but not
without the consent of the creditor.
Payment by the new debtor gives him
the rights mentioned in articles 1236
I and 1237.

Art. 1294. If the substitution is

C
There are two credits Creditor
credit I and Debtor without the knowledge or against the
credit II. In credit I, A is the will of the debtor, the new debtor's
A creditor B insolvency or non-fulfillment of the
and B is the debtor. In credit II, B is the
Debtor
creditor and A is the debtor. A wants to Creditor obligations shall not give rise to any
assign credit I to C. A cannot assign liability on the part of the original
credit II since it is passive subjective debtor.
novation. Can B now invoke againstIIC
the compensation of credit II? Art. 1295. The insolvency of
the new debtor, who has been

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Professor Ruben F. Balane Page 202 of 241
 proposed by the original debtor and (3) When, even without the
accepted by the creditor, shall not knowledge of the debtor, a
revive the action of the latter against person interested in the
the original obligor, except when said fulfillment of the obligation
insolvency was already existing and of pays, without prejudice to the
public knowledge, or known to the effects of confusion as to the
debtor, when the delegated his debt. latter's share.

Art. 1296. When the principal Art. 1303. Subrogation

obligation is extinguished in transfers to the persons subrogated
consequence of a novation, accessory the credit with all the rights thereto
obligations may subsist only insofar appertaining, either against the
as they may benefit third persons who debtor or against third person, be they
did not give their consent. guarantors or possessors of
mortgages, subject to stipulation in a
Art. 1297. If the new obligation conventional subrogation.
is void, the original one shall subsist,
unless the parties intended that the Art. 1304. A creditor, to whom
former relation should be partial payment has been made, may
extinguished in any event. exercise his right for the remainder,
and he shall be preferred to the
Art. 1298. The novation is void person who has been subrogated in
if the original obligation was void, his place in virtue of the partial
except when annulment may be payment of the same credit.
claimed only by the debtor or when
ratification validates acts which are Novation is the extinguishment of an
voidable. obligation by the substitution or change
of the obligation by a subsequent one
Art. 1299. If the original which extinguishes or modifies the first,
obligation was subject to a suspensive either by changing the object of
or resolutory condition, the new principal conditions, or by substituting
obligation shall be under the same the person of the debtor, or by
condition, unless it is otherwise subrogating a third person in the rights
stipulated. of the creditor.
Novation is the most unusual mode of
Art. 1300. Subrogation of a extinguishing an obligation. It is the
third person in the rights of the only mode whereby an obligation is
creditor is either legal or extinguished and a new obligation is
conventional. The former is not created to take its place. The other
presumed, except in cases expressly modes of extinguishing an obligation are
mentioned in this Code; the latter absolute in the sense that the
must be clearly established in order extinguishment of the obligation is total.
that it may take effect. Novation, on the other hand, is a relative
mode of extinguishing an obligation.
Art. 1301. Conventional A compromise is a form of novation.
subrogation of a third person requires The difference is that a compromise has
the consent of the original parties and some judicial participation. The effect
of the third person. of compromise is the same as novation.
Classification of Novation
Art. 1302. It is presumed that a. Subjective or Personal Novation
there is legal subrogation: change of one of the subjects
(1) When a creditor pays another i. Active subjective
creditor who is preferred, This a change of creditor.
even without the debtor's
This is also known as
knowledge;
subrogation.
(2) When a third person, not
2 Kinds of Subrogation
interested in the obligation,
1. Legal (Article 1302)
pays with the express or tacit
approval of the debtor;

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Professor Ruben F. Balane Page 203 of 241
 It is presumed that the debtor or against
there is legal third persons, be they
subrogation: guarantors or
a. When a creditor possessors of
pays another mortgages, subject to
creditor who is stipulation in a
preferred, even conventional
without the subrogation (Article
debtor's 1303)
knowledge; ii. Passive subjective
b. When a third This is a change of debtor.
person, not Types of Passive Subjective
interested in 1. Expromission (Article
the obligation, 1293)
pays with the In expromission the
express or tacit changing of the
approval of the debtor is not upon
debtor the old debtor's
c. When, even initiative. It could
without the be upon the
knowledge of initiative of the
the debtor, a creditor or of the
person new debtor.
interested in This requires the
the fulfillment consent of the
of the obliga- creditor since the
tion pays, changing of the
without debtor may
prejudice to the prejudice him. This
effects of requires the consent
confusion as to of the new debtor
the latter's since he is the one
share; who will pay.
2. Conventional The consent of the
Conventional old debtor is not
subrogation of a required.
third person The intent of the
requires the consent parties must be to
of the original release the old
parties and of the debtor. The release
third person of the old debtor is
(Article 1301) absolute even if it
Effect of Subrogation turns out that the
1. A creditor, to whom new debtor is
partial payment has insolvent.
been made, may Cases of
exercise his right for the expromission are
remainder, and he shall quite rare.
be preferred to the 2. Delegacion (Article
person who has been 1295)
subrogated in his place In delegacion the
in virtue of the partial change is at the
payment of the same debtors initiative.
credit (Article 1304)
The consent of the
2. Subrogation transfers to
old debtor
the person subrogated
(delegante), the
the credit with all the
new debtor
rights thereto apper-
(delegado), and the
taining, either against

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Professor Ruben F. Balane Page 204 of 241
 creditor Finally, a mortgage was
(delegatario) are all constituted. The SC said in Fua
required. vs. Yap that there was a
The intent of the novation. Therefore, a mere
parties must be to change in the amount or mode
release the old of payment if taken singly is not
debtor. However, a novation. But taken together,
release of the old there is a novation.
debtor is not In Inchausti vs. Yulo, the SC
absolute. He may said that the mere extension of
be held liable time is not a novation for the
a. If the new period does affects only the
debtor was performance and not the
already creation of an obligation. In
insolvent at the another case, the SC said that
time of the the shortening of the period is a
delegacion; and novation.
b. Such insolvency c. Mixed Novation
was either Mixed is a combination of both
known to the subjective and objective
old debtor or of novation.
public Requisites of Novation
knowledge a. There must be a previous valid
b. Objective or Real Novation obligation
In objective novation there is a The novation is void if the
change in the object or in the original obligation was void,
principal conditions. except when annulment may be
Novation by a change in the claimed only by the debtor, or
principal conditions is the most when ratification validates acts
problematic kind of novation which are voidable (Article
because one has to determine 1298)
whether or not the change in the b. There must be an agreement of the
conditions is principal or merely parties to create the new obligation
incidental. If the original obligation was
If the amount of debt is subject to a suspensive or
increased, Castan thinks that resolutory condition, the new
there is a novation while obligation shall be under the
Caguioa thinks there is no same condition, unless it is
novation. Professor Balane otherwise stipulated (Article
thinks that Castan is correct. 1299)
The old obligation is merged c. There must be an extinguishments
with the new. of the old obligation
If the amount of the debt is Professor Balane considers this
decreased, according the SC in as an effect rather than a
Sandico vs. Piguing, there is no requisite of novation.
novation. One can look at the In order that an obligation may
decrease of the amount as a be extinguished by another
partial remission. which substitute the same, it is
In Millar vs. CA, there is no imperative that it be so declared
novation if the terms of the in unequivocal terms, or that
payment are changed. In this the old and the new obligations
case, there was a change from be on every point incompatible
lump sum to installment with each other (Article 1292)
payments. d. The new obligation must be valid
In Fua vs. Yap, not only was the If the new obligation is void, the
amount reduced, mode of original one shall subsist, unless
payment was changed from the parties intended that the
single payment to installment. former relation should be

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Professor Ruben F. Balane Page 205 of 241
 extinguished in any event General Rule: Unilateral withdrawals
(Article 1297) are not allowed.
Effect of Novation Exception: Partnership
Accessory obligations may subsist 18. Change of Civil Status
only insofar as they may benefit For example, if the marriage is annulled,
third persons who did not give their certain obligations are extinguished, like
consent, e.g., stipulation pour the obligations to live together and to
autrui support one another.
General Rule: In a novation, the 19. Rebus Sic Stantibus (Article 1267)
accessory obligation is extinguished. 20. Want of Interest
Exception: In an active subjective Example: A owns a peking duck
novation, the guarantors, pledgors, restaurant with a secret recipe for
mortgagors are not released. preparing peking duck. A disclosed the
Under Article 1303, accessory secret recipe to B, his cook. B is then
obligations are not extinguished. So prohibited in his employment contract
there is a conflict? How do you to work in another restaurant within 5
resolve? According to years from leaving As restaurant. Two
commentators, Article 1303 is an years after B left, A closes his restaurant
exception to Article 1296. and opens a hardware store. B can now
B owes K P1 M. M is a guarantor of work in a restaurant.
B. B is substituted by U. B is 21. Judicial Insolvency
released. M is also released under The effect of judicial insolvency is that
Article 1296. M is released since he all unpaid debts are written off for good.
guarantees Bs performance and not Thus, even if the debtor has improved
Bs. B might have a good credit his financial situation because of judicial
standing but U may not. M might insolvency, there is no need for the
be prejudiced if he has to guarantee debtor to pay his unpaid debts.
Us performance.
If there is a change in the creditor II. Contracts
under Article 1303, the guarantor is A. General Provisions
not released since it doesnt make a 1. Definition
difference. What the guarantor
guarantees is the integrity of the Art. 1305. A contract is a
debtor. meeting of the minds between 2
7. Annulment persons whereby one binds himself,
8. Rescission with respect to the other, to give
9. Fulfillment of a Resolutory Condition something or to render some service.
10. Prescription
11. Death in Certain Instances
Professor Balane thinks that the
12. For example, death extinguishes obligations definition in Article 1305 is inaccurate.
which are purely personal (i.e. obligations The term persons should be submitted
in marriage, obligation to support, by the term parties. Also, contracts
obligations in a partnership, etc.) may be multilateral; there can be more
13. Renunciation by the Creditor (Article 6) than 2 parties involved (i.e.
The creditor waives the obligation. partnership).
The renunciation need not be in any 2. Characteristics of Contracts
specific form. a. Obligatory force
Renunciation and remission are 2
different things. A renunciation is a Art. 1315. Contracts are
refusal by the creditor to enforce his perfected by mere consent, and
claim with the intention of waiving it. A from that moment the parties are
remission is in the nature of a donation. bound not only to the fulfillment
14. Compromise of what has been expressly
15. Arrival of a Resolutory Term stipulated but also to all the
16. Mutual Dissent or Desistance (Saura vs. consequences which, according to
DBP) their nature, may be in keeping
17. Unilateral Withdrawal with good faith, usage and law.

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Professor Ruben F. Balane Page 206 of 241
 General Rule: Contracts are is the fixing of the price by the 3 rd
perfected by mere consent the person.
principle of consensuality The contract may be revoked if there
(Article 1315) is mutual dissent.
Exception: Real contracts, such as c. Relativity
deposit, pledge, and commodatum
are not perfected until the delivery Art. 1311, 1. Contracts take
of the object of the obligation effect only between the parties,
(Article 1316) their assigns and heirs, except in
Obligations arising from contracts case where the rights and
have the force of law between the obligations arising from the
parties and should be complied with contract are not transmissible by
in good faith (Article 1159) their nature, or by stipulation or
Art. 1314. Any third person by provision of law. The heir is not
who induces another to violate his liable beyond the value of the
contract shall be liable for property he received from the
damages to the other contracting decedent.
party.
General Rule: The contract is
It is not clear whether Article 1314 is binding only upon the parties and
a tortious liability or a contractual their successors (Article 1311).
liability. Professor Balane considers However, if the contract is purely
it as only a tortious liability so it is personal (intuitu personae), then
not violative of the rule on relativity the contract will not bind assigns
of contracts. and heirs.
Article 1314 is really a quasi-delict. Exception: 3 parties are affected
Requisites by the contract in the following
i. Existence of a valid contract instances and can take appropriate
ii. Knowledge by the 3rd person of action
the existence of the contract i. Accion pauliana (Article 1177)
iii. Interference by the 3rd person in
the contractual relation without Art. 1177. The
legal justification creditors, after having
b. Mutuality pursued the property in
possession of the debtor to
Art. 1308. The contract satisfy their claims, may
must bind both contracting exercise all the rights and
parties; its validity or compliance bring all the actions of the
cannot be left to the will of one of latter for the same purpose,
them. save those which are
inherent in his person; they
Art. 1309. The may also impugn the acts
determination of the performance which the debtor may have
may be left to a third person, done to defraud them.
whose decision shall not be
binding until it has been made An rescissory action
known to both contracting parties. involving a contract in fraud
of creditors.
Art. 1310. The
determination shall not be Art. 1313. Creditors
obligatory if it is evidently are protected in cases of
inequitable. In such case, the contracts intended to
courts shall decide what is defraud them.
equitable under the
circumstances. ii. Accion directa
A direct (not subrogatory)
An example of a determination action by the creditor
made by a 3rd person (Article 1309) against his debtors debtor,
a remedy which gives the

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Professor Ruben F. Balane Page 207 of 241
 creditor the prerogative to
act in his own name, such as iv. Stipulation pour autrui
the actions of the lessor stipulation in favor of a 3rd
against the sublessee person
(Article 1652), the laborer
of an independent Art. 1311, 2. If a
contractor against the contract should contain
owner (Article 1729), the some stipulation in favor of
principal against the a third person, he may
subagent (Article 1893), demand its fulfillment
and the vendor-a-retro provided he communicated
against the transferee of the his acceptance to the
vendee (Article 1608). obligor before its
iii. Article 1312 revocation. A mere
incidental benefit or
Art. 1312. In interest of a person is not
contracts creating real sufficient. The contracting
rights, third persons who parties must have clearly
come into possession of the and deliberately conferred
object of the contract are a favor upon a third person.
bound thereby, subject to
the provisions of the Requisites
Mortgage Law and the Land 1. There must be a
Registration Laws. stipulation in favor of a
3rd person

Art. 1652. The sublessee is subsidiarily liable to the 2. That stipulation in favor
lessor for any rent due from the lessee. However, the of a 3rd person should be
sublessee shall not be responsible beyond the amount a part and not the whole
of rent due from him, in accordance with the terms of of the contract
the sublease, at the time of the extra-judicial demand 3. A clear and deliberate
by the lessor. intent to confer a
Payments of rent in advance by the sublessee benefit on a 3rd person
shall be deemed not to have been made, so far as the and not merely
lessor's claim is concerned, unless said payments were incidental
effected in virtue of the custom of the place. In the case of

Art. 1729. Those who put their labor upon or Mandarin Villa vs.
furnish materials for a piece of work undertaken by the CA, the credit card
contractor have an action against the owner up to the holder was held to
amount owing from the latter to the contractor at the have a right to sue
time the claim is made. However, the following shall under the contract
not prejudice the laborers, employees and furnishers of between the
materials: establishment and
(1) Payments made by the owner to the contractor the bank. The
before they are due; Supreme Court said
(2) Renunciation by the contractor of any amount that its a
due him from the owner. stipulation pour
This article is subject to the provisions of autrui to confer
special laws. benefit on the

Art. 1893. In the cases mentioned in Nos. 1 and 2 customer to

of the preceding article, the principal may furthermore purchase on credit.
bring an action against the substitute with respect to
However, Professor
the obligations which the latter has contracted under
Balane believes that
the substitution.
it is debatable
Art. 1608. The vendor may bring his action against
whether an
every possessor whose right is derived from the
vendee, even if in the second contract no mention
agreement between
should have been made of the right to repurchase, a credit card
without prejudice to the provisions of the Mortgage company and
Law and the Land Registration Law with respect to establishment is a
third persons. clear and deliberate

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Professor Ruben F. Balane Page 208 of 241
 conferment of (communes), special (especiales),
benefit on a third and extraordinary (especialisimos).
party. He would The common elements are those
have concurred with which are present in all contracts,
the decision in such as consent, object certain, and
Mandarin Villa if cause. The special elements are
the basis was quasi- present only in certain contracts,
delict. such as delivery in real contracts or
4. That the favorable form in solemn ones. The
stipulation should not extraordinary elements are those
be conditioned or which are peculiar to a specific
compensated by any contract (i.e. price in sales).
kind of obligation i. Consent
whatever 1. Consent in General
5. Neither of the Definition of Consent
contracting parties
bears the legal Art. 1319, 1st
representation of sentence. Consent is
authorization of the 3rd manifested by the
parties meeting of the offer
If the 3rd parties is and the acceptance
represented, then upon the thing and
the principles of the cause which are
agency apply. to constitute the
6. The 3rd person must contract.
have communicated his
acceptance to the Elements of Consent
obligor before its a. Plurality of subjects
revocation b. Capacity
c. Intelligent and free
d. Autonomy of will will
d. Express or tacit
Art. 1306. The contracting manifestation of the
parties may establish such will
stipulations, clauses, terms and e. Conformity of the
conditions as they may deem internal will and its
convenient, provided they are not manifestation
contrary to law, morals, good 2. Offer
customs, public order, or public An offer is a unilateral
policy. proposition which 1
party makes to the other
3. Elements of a Contract for the celebration of a
a. Essential Elements contract.
Art. 1321.
Art. 1318. There is no The person making
contract unless the following the offer may fix the
requisites concur: time, place, and
(1) Consent of the manner of
contracting parties; acceptance, all of
(2) Object certain which is which must be
the subject matter of the complied with.
contract; Requisites of Offer
(3) Cause of the obligation a. Definite
which is established. The offer must
be definite, so
The essential elements are those that upon
without which there can be no acceptance, an
contract. These elements are, in agreement can
turn, subdivided into common be reached on

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Professor Ruben F. Balane Page 209 of 241
 the whole depends on the
contract. circumstances.
b. Complete Example: A
The offer must offers to sell
be complete, 1000 kilos of
indicating with cement. B says
sufficient he wants to buy
clearness the 2000 kilos of
kind of contract cement. Is the
intended and 1000 kilos
definitely accepted? It
stating the depends. If
essential buyer wants a
conditions of block sale, that
the proposed is, only 2000
contract as well kilos and
as the non- nothing less,
essential ones then it is a
desired by the counter-offer.
offeror. b. Manifestation of
c. Intentional Acceptance
An offer Art. 1320. An
without acceptance may be
seriousness, express or implied.
made in such Silence is
manner that the ambiguous. Silence
other party in itself is neither
would not fail acceptance nor
to notice such rejection. Can it
lack of mean acceptance?
seriousness, is One must look at
absolutely the circumstances.
without Examples: A and B
juridical effects are own stalls which
and cannot give sell rice. C delivers
rise to a 1000 kilos of rice to
contract (i.e. A every Sunday. If
must not be A is not there, C just
made in jest, or leaves it with As
a prank). assistant. C tries to
3. Acceptance do business with B.
a. Requisites of B is not there
Acceptance though. C leaves
i. Unequivocal rice with Bs
ii. Unconditional assistant. B does
If the not call C. Both A
acceptance is and B are silent. A
qualified, then accepted the rice
that is a because of the
counter-offer arrangement. If A
(Article 1319, 3rd did not want to
sentence). accept the rice, then
An amplified A should have
acceptance may called. Bs silence is
or may not be not acceptance.
an acceptance c. Cognition Theory
of the original Article 1319,
offer. It 2nd . Acceptance
made by letter of

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Professor Ruben F. Balane Page 210 of 241
 telegram does not 5. On the same day,
bind the offerer the offer is
except from the time accepted. Mail is
it came to his sent to Davao on
knowledge. February 5
This is known as the signifying
Cognition Theory. acceptance. On
Commercial law February 8, the
uses the Theory of party in Manila
Manifestation. becomes insane. On
Offer and February 13, the
acceptance takes mail reaches Davao.
effect only from the According to
time knowledge is Professor Balane,
acquired by the under Article 1323,
person to whom it is there is no contract
directed. If during since there was no
intervening time, contractual
the offer or capacity.
acceptance is Example 2. The
extinguished by offer was made in
death/insanity, Bacolod on March 1.
such offer or It was received in
acceptance has no Quezon City on
more effect. March 3. On March
Example: Offeror 4, the offeree sends
gave offer on March his acceptance. On
1. The offer reached March 5, the offeror
the offeree on countermands offer.
March 5. From the Now, both
point of view of the acceptance and
offeror, offer is countermand of
counted from offer are in the mail.
March 5. He can Whichever reaches
still countermand the destination first
before March 5. will be counted.
If the parties are d. Offers Through Agents
face to face, then Art. 1322. An
there is no problem offer made through
since there is no an agent is accepted
time gap. from the time
The problem arises acceptance is
when there is a time communicated to
gap. Under Article him.
1319, there is e. Effect of Death, Insanity
perfection of the Art. 1323. An
contract when there offer becomes
is knowledge of the ineffective upon the
other partys death, civil
acceptance. This interdiction,
has serious insanity or
consequences. insolvency of either
Example 1. The party before
offer was made in acceptance is
Davao on February conveyed.
1. The offer was f. Withdrawal of the Offer
sent through mail Art. 1324.
which is received in When the offeror
Manila on February has allowed the

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Professor Ruben F. Balane Page 211 of 241
 offeree a certain does not pay S for
period to accept, the time, but S
offer may be promises to give B
withdrawn at any 30 days. In this
time before case there is no
acceptance by option contract.
communicating such However, in
withdrawal, except Sanchez vs. Rigos,
when the option is the Supreme Court
founded upon said that even if
consideration, there was no option
something paid or contract, S must
promised. still communicate
Article 1324 is the withdrawal of
related to Article the offer to B. If S
1479, 2. They does not
actually say the communicate his
same thing. withdrawal, that is
S offers to sell a car tantamount to a
to B for P300,000. continuing offer.
B needs to think Professor Balane
about it, and so B does not agree with
asks for 30 days and this. According to
pays S P5,000. The him, if there is no
payment of P5,000 valid option
is a distinct contract, there
consideration from should be no
the price of the car. continuing offer.
This distinct According to
consideration of Professor Balane,
P5,000 is payment the Supreme Court
for the 30 days. B is should have
paying for time. The explained that.
option contract is S offers to sell a car
separate from the to B for P300,000.
contract of sale. S B needs to think
cannot sell the car about it, and so B
to anybody else asks for 30 days and
within that 30-day pays P5,000 to S. B
period. If S sells the decides to buy the
car to someone else car within 30 days.
within the 30-day The car is not sold
period, he is guilty to anybody else. S
of contractual does not want to
breach. But B can sell the car to B. B
buy the car before can sue S for
the end of the 30- specific
day period and such performance
will be a valid sale. compel S to sell him
S offers to sell a car the car.
to B for P300,000. S offers to sell a car
B needs to think to B for P300,000.
about it, and so B B needs to think
asks for 30 days. B about it, and so B
asks for 30 days and

Art. 1479, 2. An accepted unilateral promise to buy

pays P5,000 to S. B
or to sell a determinate thing for a price certain is
decides to buy the
binding upon the promissor if the promise is supported car within 30 days.
by a consideration distinct from the price. Before B is able to

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Professor Ruben F. Balane Page 212 of 241
 buy the car, S sells payment of separate
the car to X. B can consideration but a
sue S for damages. right of first refusal
B cannot sue for does not. However,
specific in Litonjua vs. CA,
performance since the Supreme Court
the car has been said that in a right
sold to an innocent of first refusal, the
purchaser. consideration for
A right of first the loan or
refusal is different mortgage is already
from an option a part of the
contract. A right of consideration for
first refusal is the the right of first
right to have first refusal.
opportunity to In Ang Yu vs. CA,
purchase or the the SC said that an
right to meet any action for specific
other offer. On the performance will
other hand, an not lie against the
option contact promissor.
limits the However, a
promissors power complaint under
to revoke an offer. Article 19 for
The right of first damages may be
refusal is not filed if the actions of
covered by the Civil the promissor are
Code. whimsical. In
A right of first Equatorial vs.
refusal is a Mayfair the right of
statement by a first refusal was
person to another violated when the
that if the former vendor sold the
decides to sell the object to another
object, the latter person. The SC in
will have the first Equatorial vs.
offer. Here, the Mayfair said that
object is an action for
determinable. But specific
the exercise of the performance may
right to buy is be filed. Equatorial
conditioned on the vs. Mayfair is
sellers decision to totally inconsistent
sell on terms which with Ang Yu vs. CA.
are not yet certain. The Supreme Court
According to has held
Equatorial vs. (Equatorial vs.
Mayfair, the Mayfair,
requirement of Paraaque Kings
separate vs. CA, Litonjua vs.
consideration is not CA, PUP vs. CA)
applicable in a right that the right of first
of first refusal. refusal is
According to enforceable by an
Professor Balane, action for specific
this is peculiar since performance. And
an option contract that the actual
is more firm and yet vendee may be
it requires the required to sell the

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Professor Ruben F. Balane Page 213 of 241
 property to the person. Why is the
holder of the right SC giving greater
of first refusal at the legal effect to a right
price which he of first refusal
bought it. which is more
However, in a tentative? Also,
recent case, where the SC get
Rosencorr vs. CA these rules since the
(March 8, 2001), right of first refusal
the Supreme Court is not covered by
has held that the the Civil Code.
right of first refusal g. Advertisements
need not be written Art. 1325.
to be unenforceable Unless it appears
since it is not otherwise, business
included in the advertisements of
Statute of Frauds. things for sale are
Also, if the vendee not definite offers,
is in good faith, he but mere invitations
may not be to make an offer.
compelled by Art. 1326.
specific Advertisements for
performance since bidders are simply
he relied on a title invitations to make
which is clean. The proposals, and the
remedy is to go advertiser is not
after the vendor. bound to accept the
In a right of first highest or lowest
refusal, there is no bidder, unless the
definite offer since contrary appears.
the vendor has to Most
option of deciding advertisements are
not to sell the simply invitations
object. Also, in a to make an offer
right of first refusal, and are not offers in
there is no need for themselves since
a separate not all the necessary
consideration. In terms can fit in the
an option contract, advertisement.
there is a definite Even if the ad had
offer. According to all the necessary
Professor Balane, terms, its still an
the right of first invitation to make
refusal is inferior to offer since there is
an option contract no definite person
since there is no to whom the offer is
definite offer. being made (public
Professor Balane offer).
does not h. Simulated Contracts
understand why an Art. 1345.
action for specific Simulation of a
performance is contract may be
allowed in absolute or relative.
violations of rights The former takes
of first refusal but place when the
not in the case of parties do not intend
option contracts to be bound at all;
when the object is the latter, when the
sold to another

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Professor Ruben F. Balane Page 214 of 241
 parties conceal their but disguise it
true agreement. as another.
Art. 1346. An For example, X
absolutely simulated has many
or fictitious contract creditors, and
is void. A relative they are going
simulation, when it after Xs car. X
does not prejudice a cannot donate
third person and is his car to Y
not intended for any since the
purpose contrary to creditors will
law, morals, good just resort to
customs, public accion
order or public pauliana. So, X
policy binds the antedates a
parties to their real contract of sale,
agreement. selling his car to
i. Absolutely Y, except that
Simulated Xs intention is
(contrato simulado) to donate his
Absolute car to Y.
simulation of a A relatively
contract takes simulated
place when the contract, when
parties do not it does not
intent to be prejudice a 3rd
bound at all person and is
(Article 1345). not intended for
For example, X any purpose
pretends to sell contrary to law,
his car to avoid morals, good
tax liability. customs, public
However X has order or public
no real policy binds the
intention to sell parties to their
the car. real agreement
An absolutely (Article 1346).
simulated or The law will
fictitious apply the rules
contract is void of the true
(Article 1346) contract and
ii. Relatively not the
Simulated ostensible
(contrato contract.
disimulado) ii. Object
Relative
simulation of a Art. 1347. All things
contract takes which are not outside the
place when the commerce of men,
parties conceal including future things,
their true may be the object of a
agreement contract. All rights which
(Article 1345). are not intransmissible
In a relatively may also be the object of
simulated contracts.
contract, the No contract may be
parties enter entered into upon future
into a contract inheritance except in cases

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Professor Ruben F. Balane Page 215 of 241
 expressly authorized by Emptio rei speratae is a conditional
law. sale. There is a suspensive condition. If
All services which the future thing does not come into
are not contrary to law, existence, then there is no contract of
morals, good customs, sale.
public order or public Emptio spei is the sale of a hope. Even if
policy may likewise be the the future thing does not materialize, the
object of a contract. buyer must pay since the buyer is taking
a chance. (i.e. sale of lotto ticket). Hope
Art. 1348. is a present thing.
Impossible things or Some future things are not allowed to be
services cannot be the objects of the prestation. The law does
object of contracts. not allow contracts on future
inheritance.
Art. 1349. The 2. The object must licit, or not be contrary
object of every contract to law, morals, good customs, public
must be determinate as to policy or public order (Article 1347)
its kind. The fact that the 3. The object must be possible (Article
quantity is not determinate 1348)
shall not be an obstacle to If the object is impossible, then the
the existence of the contract is void for lack of cause.
contract, provided it is Article 1348 does not talk of
possible to determine the supervening impossibility which is a
same, without the need of a mode of extinguishments.
new contract between the
Impossibility under Article 1348 must
parties.
be actual and contemporaneous with the
making of the contract.
The object of the contract is 4. The object must be determinate as to its
the prestation. Thus, it is kind and determinable as to its quantity
always the conduct which is (Article 1349)
to be observed. It is not a
The object need not be individualized. It
concrete object like a car. In
must be determinate as to its kind or
a contract of sale, the object
species.
is the delivery of the object
The quantity of the object may be
and not the object itself.
indeterminate, so long as the right of the
The provisions on object however blur
creditor is not rendered illusory.
the distinction between the object of the
5. The object must be transmissible
contract, the prestation, and the object
This is actually a redundancy since this
of the prestation. According to
is already in the requisite of being within
Professor Balane, these provisions are
the commerce of man.
not fatal though.
iii. Cause
Requisites of Object
1. The object must be within the commerce
Art. 1350. In onerous
of man, either already existing or in
contracts the cause is understood
potency (Article 1347)
to be, for each contracting party,
Within the commerce of man means the prestation or promise of a
that the object is capable of thing or service by the other; in
appropriation and transmission. remuneratory ones, the service or
The term in potency means that the benefit which is remunerated; and
object will come into existence in the in contracts of pure beneficence,
future. the mere liberality of the
Generally in reciprocal contracts benefactor.
particularly sales, the sale of future
things is allowed. For example, it is Art. 1351. The particular
possible to sell the future harvest of a motives of the parties in entering
farm. into a contract are different from
The coming into being of the future the cause thereof.
thing is a suspensive condition.

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Professor Ruben F. Balane Page 216 of 241
 Art. 1352. Contracts Cause is different from
without cause, or with unlawful motive. Cause is the
cause, produce no effect whatever. proximate why while motive
The cause is unlawful if it is is the ultimate why. For
contrary to law, morals, good example, A wants to sell his
customs, public order or public house for P60 M because A
policy. is moving to Canada. B is
willing to buy the house for
Art. 1353. The P60 M. In this case, the
statement of a false cause in cause for A is the P60 M
contracts shall render them while the cause for B is the
void, if it should not be house. As motive is to
proved that they were dispose of the house which
founded upon another he does not need since A is
cause which is true and going to Canada.
lawful. Like failure of or lack of
object, the failure of cause
Art. 1354. Although has an effect on the
the cause is not stated in contract. If there is no
the contract, it is presumed cause or the cause is illegal,
that it exists and is lawful, then the contract is void.
unless the debtor proves This is unlike the lack of
the contrary. consent. When consent is
lacking, the contract is not
Art. 1355. Except in void. The contract is merely
cases specified by law, voidable.
lesion or inadequacy of General Rule: Failure of
cause shall not invalidate a motive as a General Rule
contract, unless there has does not affect the contract.
been fraud, mistake or Exception: Motive affects
undue influence. the contract when
1. The motive becomes a
The cause of a contract is suspensive condition; or
the why of the contract, 2. The realization of the
the immediate and most motive is the cause for
proximate purpose of the the contract and there is
contract, the essential an intervening serious
reason which impels the mistake of fact
contracting parties to enter In onerous contracts, the
into it and which explains cause is the prestation or
and justifies the creation of promise of a thing or service
the obligation through such by the other party.
contract. It has been held that, as
The cause is different from a mortgage is an
consideration. accessory contract, its
Consideration in the Anglo- cause or consideration
American sense must is the very cause or
always be valuable or consideration of the
capable of pecuniary principal contract, from
estimation. Cause, on the which it receives its life,
other hand, need not be and without which it
material at all, and may cannot exist as an
consist in a moral independent contract
satisfaction for the (China Bank vs.
promissor. Lichauco).
Requisites of Cause In remuneratory contracts,
1. It must exist the cause is the service or
2. It must be true
3. It must be licit

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Professor Ruben F. Balane Page 217 of 241
 benefit which is i. Preparatory
remunerated . A preparatory contract is one
A remuneratory which has for its object the
contract is one where a establishment of a condition in
party gives something law which is necessary as a
to another because of preliminary step towards the
some service or benefit celebration of another
given or rendered by the subsequent contract (i.e.
latter to the former, partnership, agency).
where such service or ii. Principal
benefit was not due as a A principal contract is one
legal obligation. which can subsist independently
In gratuitous contracts, the from other contracts and whose
cause is the mere liberality purpose can be fulfilled by
of the benefactor. themselves (i.e. sales, lease).
Delivery for real iii. Accessory
contracts An accessory contract is one
Form for formal which can exist only as a
contracts consequence of, or in relation
b. Natural Elements with, another prior contract (i.e.
The natural elements are those pledge, mortgage).
which are derived from the nature of b. According to Perfection
the contract and ordinarily i. Consensual
accompany the same. They are A consensual contract is one
presumed by law, although they can which is perfected by mere
be excluded by the contracting agreement of the parties (i.e.
parties if they so desire. sales, lease).
i. Right to resolve (Article 1191) ii. Real
ii. Warranties in sales contracts A real contract is one which
c. Accidental Elements requires not only the consent of
The accidental elements are those the parties for their perfection,
which exist only when the parties but also the delivery of the
expressly provide for them for the object by 1 party to the other
purpose of limiting or modifying the (i.e. commodatum, deposit,
normal effects of the contract (i.e. pledge).
conditions, terms, modes) c. According to their Form
4. Stages of a Contract i. Common or informal
a. Preparation, conception, or generation, An informal contract is one
which is the period of negotiation and which does not require some
bargaining, ending at the moment of particular form (i.e. loan, lease).
agreement of the parties ii. Special or formal
b. Perfection or birth of the contract, which A formal contract is one which
is the moment when the parties come to requires some particular form
agree on the terms of the contract (i.e. donation, chattel
General Rule: Contracts are mortgage).
perfected by mere consent the d. According to Purpose
principle of consensuality i. Transfer of ownership (i.e. sale)
(Article 1315) ii. Conveyance of use (i.e.
Exception: Real contracts, such as commodatum)
deposit, pledge, and commodatum iii. Rendition of service (i.e. agency)
are not perfected until the delivery e. According to Subject Matter
of the object of the obligation i. Things (i.e. sale, deposit, pledge)
(Article 1316) ii. Services (i.e. agency, lease of
c. Consummation or death, which is the services)
fulfillment or performance of the terms f. According to the Nature of the
agreed upon Obligation
5. Classification of Contracts i. Bilateral
a. According to Degree of Dependence

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Professor Ruben F. Balane Page 218 of 241
 A bilateral contract is one which Art. 1307. Innominate
gives rise to reciprocal contracts shall be regulated by
obligations for both parties (i.e. the stipulations of the parties,
sale, lease). by the provisions of Titles I and
ii. Unilateral II of this Book, by the rules
A unilateral contract is one governing the most analogous
which gives rise to an obligation nominate contracts, and by the
for only 1 of the parties (i.e. customs of the place.
commodatum, gratuitous
deposit). An innominate contract is one
g. According to Cause that does not have a name and is
i. Onerous not regulated by special
An onerous contract is one in provisions of law.
which each of the parties aspires A contract is not void just
to procure for himself a benefit because it has no name. It is not
through the giving of an a requisite for validity. A
equivalent or compensation (i.e. contract may have no name but
sale). it can be valid provided it has all
ii. Gratuitous the elements of a contract and
A gratuitous contract is one in all the restrictions are respected.
which one of the parties 4 Classes of Innominate
proposes to give to the other a Contracts
benefit without any equivalent do ut des (I give that you
or compensation (i.e. give)
commodatum). do ut facias (I give that you
h. According to Risk do)
i. Commutative facio ut des (I do that you
A commutative contract is one give)
in which each of the parties facio ut facias (I do that
acquires an equivalent of his you do)
prestation and such equivalent B. Form of Contracts
is pecuniarily appreciable and
already determined from the Art. 1356. Contracts shall be
moment of the celebration of obligatory, in whatever form they may
the contract (i.e. lease). have been entered into, provided all the
ii. Aleatory essential requisites for their validity are
An aleatory contract is one in present. However, when the law requires
which each of the parties has to that a contract be in some form in order
his account the acquisition of an that it may be valid or enforceable, or that
equivalent prestation , but such a contract be proved in a certain way, that
equivalent, although pecuniarily requirement is absolute and
appreciable, is not yet indispensable. In such cases, the right of
determined, at the moment of the parties stated in the following article
the celebration of the contract, cannot be exercised.
since it depends upon the
happening of an uncertain Art. 1357. If the law requires a
event, thus charging the parties document or other special form, as in the
with the risk of loss or gain (i.e. acts and contracts enumerated in the
insurance). following article, the contracting parties
i. According to Name may compel each other to observe that
i. Nominate form, once the contract has been
A nominate contract is one perfected. This right may be exercised
which has a name and is simultaneously with the action upon the
regulated by special provisions contract.
of law (i.e. sale, lease)
ii. Innominate Art. 1358. The following must
appear in a public document:

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Professor Ruben F. Balane Page 219 of 241
 (1) Acts and contracts which have and receives part of such goods
for their object the creation, and chattels, or the evidence, or
transmission, modification or some of them, of such things in
extinguishment of real rights action, or pay at the time some
over immovable property; sales part of the purchase money; but
of real property or of an interest when a sale is made by auction
therein a governed by articles and entry is made by the
1403, No. 2, and 1405; auctioneer in his sales book, at
(2) The cession, repudiation or the time of sale, of the amount
renunciation of hereditary rights and kind of property sold, terms
or of those of the conjugal of sale, price, names of the
partnership of gains; purchasers and person on
(3) The power to administer whose account the sale is made,
property, or any other power it is a sufficient memorandum
which has for its object an act (Article 1403 (d))
appearing or which should e. An agreement of lease for a
appear in a public document, or period of more than 1 year, or
should prejudice a third person; the sale of real property or of an
(4) The cession of actions or rights interest therein (Article 1403
proceeding from an act (e))
appearing in a public document. f. A representation as to the credit
All other contracts where the of a 3rd person (Article 1403 (f))
amount involved exceeds five hundred g. No express trusts concerning an
pesos must appear in writing, even a immovable or any interest
private one. But sales of goods, chattels therein may be proved by parol
or things in action are governed by evidence (Article 1443)
articles, 1403, No. 2 and 1405. 3. For registrability
The following must appear in a
General Rule: There is no need for a public instrument:
specific form, but there must still be some a. Acts and contracts which have
manifestation of consent. for their object the creation,
Exception: When the written form is transmission, modification or
required extinguishment of real rights
1. For validity over immovable property; sales
If it not written, the same is void. of real property or of an interest
Examples are donations (Articles therein governed by Articles
748, 749), antichresis (Article 2134), 1403 (2) and 1405
interest in a loan (Article 1956), sale b. The cession, repudiation or
of land by an agent (Article 1874), renunciation of hereditary
contribution of immovables in a rights or of those of the conjugal
partnership (Article 1773) partnership of gains
2. For enforceability c. The power to administer
The contract is unenforceable if it is property, or any other power
not written. which has for its object an act
a. An agreement that by its terms appearing or which should
is not to be performed within a appear in a public document, or
year from the making thereof should prejudice a 3rd person
(Article 1403 (a)) d. The cession of actions or rights
b. A special promise to answer for proceeding from an act
the debt, default or miscarriage appearing in a public document
of another (Article 1403 (b)) Contracts enumerated in Article
c. An agreement made in 1358 are valid as between the
consideration of marriage, other contracting parties even when they
than a mutual promise to marry have not been reduced to public or
(Article 1403 (c)) private writings.
d. An agreement for the sale of Except in certain cases where public
goods, chattels or things in instruments and registration are
action, at a price not less than required for the validity of the
P500, unless the buyer accepts contract itself, the legalization of a

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Professor Ruben F. Balane Page 220 of 241
 contract by means of a public Art. 1364. When through the
writing and its entry in the register ignorance, lack of skill, negligence or bad
are not essential solemnities or faith on the part of the person drafting
requisites for the validity of the the instrument or of the clerk or typist,
contract as between the contracting the instrument does not express the true
parties, but are required for the intention of the parties, the courts may
purposes of making it effective as order that the instrument be reformed.
against 3rd person.
Article 1357 gives the contracting Art. 1365. If two parties agree
parties the coercive power to upon the mortgage or pledge of real or
reciprocally compel the execution of personal property, but the instrument
the formalities required by law, as states that the property is sold absolutely
soon as the requisites for the validity or with a right of repurchase,
of the contracts are present. reformation of the instrument is proper.
C. Reformation of Instruments
Art. 1366. There shall be no
Art. 1359. When, there having reformation in the following cases:
been a meeting of the minds of the parties (1) Simple donations inter vivos
to a contract, their true intention is not wherein no condition is
expressed in the instrument purporting imposed;
to embody the agreement, by reason of (2) Wills;
mistake, fraud, inequitable conduct or (3) When the real agreement is void.
accident, one of the parties may ask for
the reformation of the instrument to the Art. 1367. When one of the parties
end that such true intention may be has brought an action to enforce the
expressed. instrument, he cannot subsequently ask
If mistake, fraud, inequitable for its reformation.
conduct, or accident has prevented a
meeting of the minds of the parties, the Art. 1368. Reformation may be
proper remedy is not reformation of the ordered at the instance of either party or
instrument but annulment of the his successors in interest, if the mistake
contract. was mutual; otherwise, upon petition of
the injured party, or his heirs and
Art. 1360. The principles of the assigns.
general law on the reformation of
instruments are hereby adopted insofar Art. 1369. The procedure for the
as they are not in conflict with the reformation of instrument shall be
provisions of this Code. governed by rules of court to be
promulgated by the Supreme Court.
Art. 1361. When a mutual mistake
of the parties causes the failure of the Once the minds of the contracting parties
instrument to disclose their real meet, a valid contract exists, whether the
agreement, said instrument may be agreement is reduced to writing or not.
reformed. There are instances however, where in
reducing their agreements to writing, the
Art. 1362. If one party was true intention of the contracting parties are
mistaken and the other acted not correctly expressed in the document,
fraudulently or inequitably in such a way either by reason of mistake, fraud,
that the instrument does not show their inequitable conduct or accident. It is in such
true intention, the former may ask for the cases that reformation of instruments is
reformation of the instrument. proper. The action for such relief rests on
the theory that the parties came to an
Art. 1363. When one party was understanding, but in reducing it to writing,
mistaken and the other knew or believed through mutual mistake, fraud or some
that the instrument did not state their other reason, some provision was omitted or
real agreement, but concealed that fact mistakenly inserted, and the action to
from the former, the instrument may be change the instrument so as to make it
reformed. conform to the contract agreed upon.
Reformation Distinguished from Annulment

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Professor Ruben F. Balane Page 221 of 241
 The action for reformation of The mistake of 1 party must
instruments presupposes that there is a refer to the contents of the
valid existing contract between the instrument and not the
parties, and only the document or subject mater or the
instrument which was drawn up and principal conditions of the
signed by them does not correctly agreement. In the latter
express the terms of their agreement. case, an action for
On the other hand, if the minds of the annulment is the proper
parties did not meet, or if the consent of remedy.
either one was vitiated by violence or If 2 parties agree upon the
intimidation or mistake or fraud, so that mortgage or pledge of real
no real and valid contract was made, the property or personal
action is for annulment. property, but the
Annulment involves a complete instrument states that the
nullification of the contract while property is sold absolutely
reformation gives life to it upon certain or with a right of
corrections. repurchase, reformation is
Operation and Effect of Reformation proper.
Upon reformation of an instrument, the c. The proof of mutual mistake must
general rule is that it relates back to, and be clear and convincing
takes effect from the time of its original Limitations of Reformation
execution, especially as between the 1. Reformation is not proper in the
parties. following cases:
Requisites of Reformation a. Simple donations inter vivos
1. There must have been a meeting of the wherein no condition is imposed
minds upon the contract b. Wills
2. The instrument or document evidencing c. When the real agreement is void
the contract does not express the true 2. Who may ask for reformation
agreement between the parties a. If the mistake is mutual
3. The failure of the instrument to express Reformation may be ordered at
the agreement must be due to mistake, the instance of either party or
fraud, inequitable conduct or accident his successors in interest
Requisites of Mistake b. If the mistake is not mutual
a. That the mistake is one of fact Reformation may be ordered
Whenever an instrument is upon petition of the injured
drawn with the intention of party or his heirs and assigns
carrying an agreement 3. Effect of enforcing an action
previously made, but which, When one of the parties has brought
due to mistake or an action to enforce the instrument,
inadvertence of the he cannot subsequently ask for its
draftsman or clerk, does not reformation.
carry out the intention of D. Interpretation of Contracts
the parties, but violates it, Where the parties have reduced their
there is a ground to correct contract into writing, the contents of the
the mistake by reforming writing constitutes the sole repository of the
the instrument. terms of the agreement between the parties.
b. That it was common to both Whatever is not found in the writing must be
parties understood as waived and abandoned.
A written instrument may Generally, therefore, there can be no
be reformed where there is a evidence of the terms of the contract other
mistake on 1 side and fraud than the contents of the writing, unless it is
or inequitable conduct on alleged and proved that the intention of the
the other, as where 1 party parties is otherwise.
to an instrument has made a
mistake and the other Art. 1370. If the terms of a
knows it and conceals the contract are clear and leave no doubt
truth from him. upon the intention of the contracting

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Professor Ruben F. Balane Page 222 of 241
 parties, the literal meaning of its interpretation of the ambiguities of a
stipulations shall control. contract, and shall fill the omission of
If the words appear to be contrary stipulations which are ordinarily
to the evident intention of the parties, the established.
latter shall prevail over the former.
When there is doubt as to the meaning of
When the terms of the agreement are so any particular language, it should be
clear and explicit that they do not justify an determined by a consideration of the general
attempt to read into it any alleged intention scope and purpose of the instrument in
of the parties, the terms are to be which it occurs.
understood literally just as they appear on An instrument may be construed according
the face of the contract. to usage in order to determine its true
When the true intent and agreement of the character.
parties is established, it must be given effect
and prevail over the bare words of the Art. 1377. The interpretation of obscure
written agreement. words or stipulations in a contract shall
not favor the party who caused the
Art. 1371. In order to judge the obscurity.
intention of the contracting parties, their
contemporaneous and subsequent acts The party who draws up a contract in which
shall be principally considered. obscure terms or clauses appear, is the one
responsible for the obscurity or ambiguity;
Art. 1372. However general the they must therefore be construed against
terms of a contract may be, they shall not him.
be understood to comprehend things that
are distinct and cases that are different Art. 1378. When it is absolutely
from those upon which the parties impossible to settle doubts by the rules
intended to agree. established in the preceding articles, and
the doubts refer to incidental
Art. 1373. If some stipulation of circumstances of a gratuitous contract,
any contract should admit of several the least transmission of rights and
meanings, it shall be understood as interests shall prevail. If the contract is
bearing that import which is most onerous, the doubt shall be settled in
adequate to render it effectual. favor of the greatest reciprocity of
interests.
Art. 1374. The various stipulations If the doubts are cast upon the
of a contract shall be interpreted principal object of the contract in such a
together, attributing to the doubtful ones way that it cannot be known what may
that sense which may result from all of have been the intention or will of the
them taken jointly. parties, the contract shall be null and
void.
Where the instrument is susceptible of 2
interpretations, 1 which will make it invalid Art. 1379. The principles of
and illegal, and another which will make it interpretation stated in Rule 123 of the
valid and legal, the latter interpretation Rules of Court shall likewise be observed
should be adopted. in the construction of contracts.
In the construction of an instrument where
there are several provisions or particulars, Rule 130, Rules of Court
such a construction is, if possible, to be
adopted as will give effect to all. Sec. 10. Interpretation of a
writing according to its legal meaning.
Art. 1375. Words which may have The language of a writing is to be
different significations shall be interpreted according to the legal
understood in that which is most in meaning it bears in the place of its
keeping with the nature and object of the execution, unless the parties intended
contract. otherwise.

Art. 1376. The usage or custom

of the place shall be borne in mind in the
Now, Rule 130, 10-19.

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Professor Ruben F. Balane Page 223 of 241
 Sec. 11. Instrument construed so characters or the meaning of the
as to give effect to all provisions. In the language.
construction of an instrument where
there are several provisions or Sec. 17. Of two constructions,
particulars. such a construction is, if which preferred. When the terms of an
possible, to be adopted as will give effect agreement have been intended in a
to all. different sense by the different parties to
it, that sense is to prevail against either
Sec. 12. Interpretation according party in which he supposed the other
to intention; general and particular understood it, and when different
provisions. In the construction of an constructions of a provision are
instrument, the intention of the parties is otherwise equally proper, that is to be
to be pursued; and when a general and a taken which is the most favorable to the
particular provision are inconsistent, the party in whose favor the provision was
latter is paramount to the former. So a made.
particular intent will control a general
one that is inconsistent with it. Sec. 18. Construction in favor of
natural right. When an instrument is
When a general and a particular provision equally susceptible of two
are inconsistent, the particular provision will interpretations, one is favor of natural
control. right and the other against it, the former
is to be adopted.
Sec. 13. Interpretation according
to circumstances. For the proper Sec. 19. Interpretation according
construction of an instrument, the to usage. An instrument may be
circumstances under which it was made, construed according to usage, in order to
including the situation of the subject determine its true character.
thereof and of the parties to it, may be
shown, so that the judge may be placed in E. Defective Contracts
the position of those whose language he is The remaining chapters deal with defective
to interpret. contracts. The Civil Code made major and
important improvements on this topic.
Sec. 14. Peculiar signification of Unlike the Spanish Code, the defective
terms. The terms of a writing are contracts were ambiguous and had unclear
presumed to have been used in their classifications. They were simply void or
primary and general acceptation, but voidable. Here, in our present code, there
evidence is admissible to show that they are for types of defective contracts, from the
have a local, technical, or otherwise serious to less serious, in the following
peculiar signification, and were so used order:
and understood in the particular
instance, in which case the agreement
Void
must be construed accordingly.
Unenforceable
Sec. 15. Written words control
printed. When an instrument consists Voidable
partly of written words and partly of a
Rescissible However, our Code still has some
printed form, and the two are imperfections. As pointed out by Tolentino,
inconsistent, the former controls the there must be a relatively void contract.
latter. For example, in an assignment of lease
without authority, this is void as to third
Sec. 16. Experts and interpreters parties, but valid as between the parties.
to be used in explaining certain writings. There have been several cases decided by
When the characters in which an our Supreme Court wherein a chattel
instrument is written are difficult to be mortgage over real property was declared
deciphered, or the language is not void as to third parties but valid as between
understood by the court, the evidence of the parties.
persons skilled in deciphering the Whatever imperfections the Code has, it still
characters, or who understand the is better than other codes on this topic.
language, is admissible to declare the 1. Rescissible Contracts

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Professor Ruben F. Balane Page 224 of 241
 Art. 1380. Contracts validly Neither shall rescission take
agreed upon may be rescinded in the place when the things which are the
cases established by law. object of the contract are legally in the
possession of third persons who did
Art. 1381. The following not act in bad faith.
contracts are rescissible: In this case, indemnity for
(1) Those which are entered into damages may be demanded from the
by guardians whenever the person causing the loss.
wards whom they represent
suffer lesion by more than one- Art. 1386. Rescission referred
fourth of the value of the things to in Nos. 1 and 2 of article 1381 shall
which are the object thereof; not take place with respect to
(2) Those agreed upon in contracts approved by the courts.
representation of absentees, if
the latter suffer the lesion Art. 1387. All contracts by
stated in the preceding virtue of which the debtor alienates
number; property by gratuitous title are
(3) Those undertaken in fraud of presumed to have been entered into in
creditors when the latter fraud of creditors, when the donor did
cannot in any other manner not reserve sufficient property to pay
collect the claims due them; all debts contracted before the
(4) Those which refer to things donation.
under litigation if they have Alienations by onerous title are
been entered into by the also presumed fraudulent when made
defendant without the by persons against whom some
knowledge and approval of the judgment has been issued. The
litigants or of competent decision or attachment need not refer
judicial authority; to the property alienated, and need
(5) All other contracts specially not have been obtained by the party
declared by law to be subject to seeking the rescission.
rescission. In addition to these
presumptions, the design to defraud
Art. 1382. Payments made in a creditors may be proved in any other
state of insolvency for obligations to manner recognized by the law of
whose fulfillment the debtor could not evidence.
be compelled at the time they were
effected, are also rescissible. Art. 1388. Whoever acquires
in bad faith the things alienated in
Art. 1383. The action for fraud of creditors, shall indemnify the
rescission is subsidiary; it cannot be latter for damages suffered by them
instituted except when the party on account of the alienation,
suffering damage has no other legal whenever, due to any cause, it should
means to obtain reparation for the be impossible for him to return them.
same. If there are two or more
alienations, the first acquirer shall be
Art. 1384. Rescission shall be liable first, and so on successively.
only to the extent necessary to cover
the damages caused. Art. 1389. The action to claim
rescission must be commenced within
Art. 1385. Rescission creates four years.
the obligation to return the things For persons under
which were the object of the contract, guardianship and for absentees, the
together with their fruits, and the period of four years shall not begin
price with its interest; consequently, it until the termination of the former's
can be carried out only when he who incapacity, or until the domicile of the
demands rescission can return latter is known.
whatever he may be obliged to
restore. This is not be to confused with
resolution, discussed in Article 1191.

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Professor Ruben F. Balane Page 225 of 241
 This chapter on rescissible contracts is of mere administration
the proper rescissible. According to are involved, judicial
Scaevola, rescission is a process approval is necessary.
designated to render inefficacious a In case of sale,
contract validly entered into and mortgage, or other
normally binding, by reason of external encumbrance of any
conditions, causing an economic portion of the estate
prejudice to a party or to his creditors. which does not have
A rescissible contract is a contract which judicial approval is an
is valid because it contains all the unenforceable contract
essential requisites prescribed by law, (Article 1403 (1)).
but which is defective because of injury Therefore, Article 1381
or damage to either of the contracting (1) is limited to
parties or to 3rd persons, as a contracts which
consequence of which it may be constitute mere acts of
rescinded by means of a proper action administration (i.e. the
for rescission. purchase of equipment
Rescission is a remedy granted by law to for the cultivation of
the contracting parties, and even to 3 rd lands, purchase of
persons, to secure the reparation of materials for repair of
damages caused to them by a contract, buildings, etc.).
even if the same should be valid, by Lesion is very difficult
means of the restoration of things to to apply in practice.
their condition prior to the celebration For example, A is the
of the contract. agent of B. B owns land
Requisites of Rescission worth P10 M. A sells
a. The contact must be a rescissible the land for P7 M.
contract under Article 1381 or From the facts, the
Article 1382 lesion suffered by B is
The following contracts are 30%. In practice, are
rescissible you sure that P10 M is
i. Those entered into by the fair market value of
guardians whenever the the land. What if the
whom they represent suffer situation is urgent and
lesion by more than of that property must be
the value of things which disposed of right away?
are the object thereof Another example, A is
(Article 1381 (1)) the agent of B. B owns
Rescission shall not land worth P10 M. C
take place with respect wants to buy the land.
to contracts approved C is willing to pay P 7 M
by the court (Article lump sum payment.
1386). D is willing to pay P 10
As a rule, when a M but on installments.
guardian enters into a ii. Those agreed upon in
contract involving the representation of absentees,
disposition of the wards if the absentee suffers lesion
property, the guardian by more than of the
must secure the value of things which are
approval of the the object thereof (Article
guardianship court. A 1381 (2))
guardian is only Rescission shall not
authorized to manage take place with respect
the estate of the ward. to contracts approved
A guardian has no by the court (Article
power to dispose of any 1386).
portion of the estate As a rule, when the legal
without approval of the representative of an
court. If more than acts

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Professor Ruben F. Balane Page 226 of 241
 absentee enters into a iii. Those undertaken in fraud
contract involving the of creditors when the
disposition of the creditors cannot in any
absentees property, he other manner collect the
must secure the claims due them (Article
approval of the court. A 1381 (3))
legal representative is This is an exception to
only authorized to the principle of
manage the estate of the relativity of contracts.
absentee. He has no Creditors, after having
power to dispose of any pursued the property in
portion of the estate possession of the debtor
without approval of the to satisfy their claims
court. If more than acts may exercise all the
of mere administration rights and bring all the
are involved, judicial actions of the latter for
approval is necessary. the same purpose, save
In case of sale, those which are
mortgage, or other inherent in his person;
encumbrance of any they may also impugn
portion of the estate the acts which the
which does not have debtor may have done
judicial approval is an to defraud them (Article
unenforceable contract 1177).
(Article 1403 (1)). Creditors are protected
Therefore, Article 1381 in cases of contracts
(2) is limited to intended to defraud
contracts which them (Article 1313).
constitute mere acts of In determining whether
administration (i.e. the or not a certain
purchase of equipment conveyance is
for the cultivation of fraudulent, the question
lands, purchase of in every case is whether
materials for repair of the conveyance was a
buildings, etc.). bona fide transaction or
Lesion is very difficult trick and contrivance to
to apply in practice. defeat creditors, or
For example, A is the whether it conserves to
agent of B. B owns land the debtor a special
worth P10 M. A sells right.
the land for P7 M. All contracts by virtue
From the facts, the of which the debtor
lesion suffered by B is alienates property by
30%. In practice, are gratuitous tile are
you sure that P10 M is presumed to have been
the fair market value of entered into in order to
the land. What if the defraud creditors, when
situation is urgent and the donor did not
that property must be reserve sufficient
disposed of right away? property to pay all debts
Another example, A is contracted before the
the agent of B. B owns donation (Article 1387,
land worth P10 M. C 1st ).
wants to buy the land. Alienations by onerous
C is willing to pay P 7 M title are also presumed
lump sum payment. fraudulent when made
D is willing to pay P 10 by persons against
M but on installments. whom some judgment
has been rendered in

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Professor Ruben F. Balane Page 227 of 241
 any instance or some made without the
writ of attachment has knowledge and approval
been issued. The of the plaintiff or court.
decision or attachment As in the case of a
need not refer to the contract in fraud of
property alienated, and creditors, the remedy of
need not have been rescission in this case is
obtained by the party given to a 3rd person
seeking the rescission who is not a party to the
(Article 1387, 2nd ). contract. The purpose
Badges of Fraud is to protect the
1. The fact that the plaintiff.
consideration of the v. All other contracts specially
conveyance is declared by law to be the
inadequate subject of rescission (Article
2. A transfer made by 1381 (5))
a debtor after suit The following provision
has begun and in sales are examples of
while it is pending rescissible contracts
against him declared by law Arts
3. A sale upon credit 1526, 1534, 1538, 1539,
by an insolvent 1540, 1556, 1560, 1567,
debtor 1659.
4. Evidence of large Payments made in a
indebtedness or state of insolvency for
complete insolvency obligations to whose
5. The transfer of all fulfillment the debtor
or nearly all of his could not be compelled
property by a at the time they were
debtor, especially effected (Article 1382)
when he is insolvent b. The person asking for rescission
or greatly must have no other legal means to
embarrassed obtain reparation for the damages
financially suffered by him (Article 1383)
6. The fact that the c. The person demanding rescission
transfer is made must be able to return whatever he
between father and may be obliged to restore if
son when there are rescission is granted (Article 1385,
present any of the 1st par)
above This requisite is only applicable
circumstances if the one who suffers the lesion
7. The failure of the is a party to the contract.
vendee to take This requisite does not apply
exclusive possession when a defrauded creditor
of all the property resorts to accion pauliana.
iv. Those which refer to things d. The things which are the object of
under litigation if they have the contract must not have passed
been entered into by the legally to the possession of a 3rd
defendant without the person acting in good faith (Article
knowledge and approval of 1385, 2nd )
the litigants or of competent Whoever acquires in bad faith
judicial authority (Article the things alienated in fraud of
1381 (4)) creditors, shall indemnify the
Article 1381 (4) refers to latter for damages suffered by
a contract executed by them on account of the
the defendant in a suit alienation, whenever, due to any
involving the ownership cause, it should be impossible
or possession of a thing, for him to return them (Article
when such contract is 1388,1st ).

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Professor Ruben F. Balane Page 228 of 241
 If there are 2 or more
alienations, the 1st acquirer shall Art. 1395. Ratification does not
be liable 1st, and so on require the conformity of the
successively (Article 1388, 2nd contracting party who has no right to
). bring the action for annulment.
e. The action for rescission must be
brought within the prescriptive Art. 1396. Ratification
period of 4 years (Article 1389) cleanses the contract from all its
2. Voidable Contracts defects from the moment it was
constituted.
Art. 1390. The following
contracts are voidable or annullable, Art. 1397. The action for the
even though there may have been no annulment of contracts may be
damage to the contracting parties: instituted by all who are thereby
(1) Those where one of the obliged principally or subsidiarily.
parties is incapable of giving However, persons who are capable
consent to a contract; cannot allege the incapacity of those
(2) Those where the consent is with whom they contracted; nor can
vitiated by mistake, violence, those who exerted intimidation,
intimidation, undue violence, or undue influence, or
influence or fraud. employed fraud, or caused mistake
These contracts are binding, base their action upon these flaws of
unless they are annulled by a proper the contract.
action in court. They are susceptible
of ratification. Art. 1398. An obligation
having been annulled, the contracting
Art. 1391. The action for parties shall restore to each other the
annulment shall be brought within things which have been the subject
four years. matter of the contract, with their
This period shall begin: fruits, and the price with its interest,
In cases of intimidation, except in cases provided by law.
violence or undue influence, from the In obligations to render
time the defect of the consent ceases. service, the value thereof shall be the
In case of mistake or fraud, basis for damages.
from the time of the discovery of the
same. Art. 1399. When the defect of
And when the action refers to the contract consists in the incapacity
contracts entered into by minors or of one of the parties, the incapacitated
other incapacitated persons, from the person is not obliged to make any
time the guardianship ceases. restitution except insofar as he has
been benefited by the thing or price
Art. 1392. Ratification received by him.
extinguishes the action to annul a
voidable contract. Art. 1400. Whenever the
person obliged by the decree of
Art. 1393. Ratification may be annulment to return the thing can not
effected expressly or tacitly. It is do so because it has been lost through
understood that there is a tacit his fault, he shall return the fruits
ratification if, with knowledge of the received and the value of the thing at
reason which renders the contract the time of the loss, with interest from
voidable and such reason having the same date.
ceased, the person who has a right to
invoke it should execute an act which Art. 1401. The action for
necessarily implies an intention to annulment of contracts shall be
waive his right. extinguished when the thing which is
the object thereof is lost through the
Art. 1394. Ratification may be fraud or fault of the person who has a
effected by the guardian of the right to institute the proceedings.
incapacitated person.

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Professor Ruben F. Balane Page 229 of 241
 If the right of action is based Contracts effected by
upon the incapacity of any one of the minors who have
contracting parties, the loss of the already passed the age
thing shall not be an obstacle to the of puberty and
success of the action, unless said loss adolescence and are
took place through the fraud or fault near the adult age,
of the plaintiff. when they pretend to
have already reached
Art. 1402. As long as one of the the age of majority,
contracting parties does not restore while in fact they have
what in virtue of the decree of not, are valid, and
annulment he is bound to return, the cannot be permitted
other cannot be compelled to comply afterwards to excuse
with what is incumbent upon him. themselves from
compliance with
A voidable contract is a contract in obligations assumed by
which all of the essential elements for them or seek their
validity are present, but the element of annulment. This is in
consent is vitiated either by lack f legal consonance with the
capacity of 1 of the contracting parties or rules of estoppel.
by mistake, violence, intimidation, (Mercado vs. Espiritu).
undue influence, or fraud. However in Braganza
Voidable contracts are binding unless v, De Villa, the SC said
they are annulled by a proper action that the
court. They are susceptible to misrepresentation of an
confirmation. incapacitate person
There is a difference between does not estop him from
confirmation and ratification. denying that he was of
Confirmation is the process of age, or from asserting
curing the defect of a voidable that he was under age,
contract. Ratification is the process at the time he entered
of curing contracts which are into the contract.
defective because they were entered According to Professor
into without authority. Balane, this view is very
The following contracts are voidable or logical. If the minor is
annullable, even though there may have too young to enter into
been no damage to the contracting contracts, he is too
parties young to be estopped.
a. Those where one of the parties is ii. Insane or demented
incapable of giving consent to a persons, and deaf mutes
contract who do not know how to
The following cannot give write
consent to a contract (Article Art. 1328.
1327): Contracts entered into
i. Unemancipated minors during a lucid interval
Where necessaries are are valid. Contracts
sold and delivered to a agreed to in a state of
minor or other person drunkenness or during
without capacity to act, a hypnotic spell are
he must pay a voidable.
reasonable price Art. 1329. The
therefore. Necessaries incapacity declared in
include everything that article 1327 is subject to
is indispensable for the modifications
sustenance, dwelling, determined by law, and
clothing, and medical is understood to be
attendance. without prejudice to
special disqualifications
established in the laws.

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Professor Ruben F. Balane Page 230 of 241
 b. Those where the consent is vitiated vitiate consent, unless such
by mistake, violence, intimidation, misrepresentation has
undue influence or fraud created substantial mistake
Art. 1330. A contract and the same is mutual.
where consent is given through
mistake, violence, Art. 1343.
intimidation, undue influence Misrepresentation made in
or fraud is voidable. good faith is not fraudulent
i. Mistake but may constitute error.
Art. 1331. In order
that mistake may invalidate ii. Violence
consent, it should refer to
the substance of the thing Art. 1335, 1st .
which is the object of the There is violence when in
contract, or to those order to wrest consent,
conditions which have serious or irresistible force
principally moved one or is employed.
both parties to enter into
the contract . Violence shall annul the
Mistake as to the obligation, although it may
identity or qualification of been employed by a 3rd
one of the parties will person who did not take
vitiate consent only when part in the contract (Article
such identity or 1336).
qualifications have been the Requisites of Violence
principal cause of the 1. Irresistible physical
contract. force is employed
A simple mistake of 2. The force is the
account shall give rise to its determining cause for
correction. giving consent
iii. Intimidation
Art. 1332. When one
of the parties is unable to Art. 1335, 2nd .
read, or if the contract is in There is intimidation when
a language not understood one of the contracting
by him, and mistake or parties is compelled by a
fraud is alleged, the person reasonable and well-
enforcing the contract must grounded fear of an
show that the terms thereof imminent and grave evil
have been fully explained to upon his person or
the former. property, or upon the
person or property of his
Art. 1333. There is spouse, descendants or
no mistake if the party ascendants, to give his
alleging it knew the doubt, consent.
contingency or risk
affecting the object of the Requisites of Intimidation
contract. 1. The
threat must be the
Art. 1334. Mutual determining cause for
error as to the legal effect giving consent
of an agreement when the 2. The
real purpose of the parties threatened act is unjust
is frustrated, may vitiate and unlawful
consent. A threat to enforce
ones claim through
Art. 1342. competent
Misrepresentation by a authority, if the
third person does not claim is just or

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Professor Ruben F. Balane Page 231 of 241
 legal, does not B gives A his house.
vitiate consent This is intimidation
(Article 1335, 4th ). because there is no
The threat to connection between
enforce a right, the crime and the
should not be aimed contract.
at a result which is 3. The
contrary to law or threat is real and
morals, or which is serious
unjust and contrary For example the
to good faith. threat must be to
Although it is lawful kill you or burn
to exercise rights, it your house and not
is not always lawful merely to pinch
to use them for you.
purposes different 4. The
from those for threat produces a well-
which they were grounded fear that the
created. Thus, person making it can
although it is lawful and will inflict harm
to report crimes, the To determine the
threat to report it degree of
may be illicit if the intimidation, the
purpose is not to age, sex, and
cooperate in the condition of the
discovery and person shall be
prosecution of the borne in mind
crime, but to obtain (Article 1335, 3rd ).
some prestation For example, a
from the culprit 75year old man who
which otherwise is bed ridden and
could not be says that he will kill
obtained and which you does not
does not constitute produce a well-
indemnity for grounded fear.
damages for the Intimidation shall
crime committed. annul the
Thus, the rule is, obligation, although
generally, a threat it may have been
to do something employed by a 3rd
lawful does not person who did not
constitute take part in the
intimidation. contract (Article
Example: If you 1336).
dont marry my iv. Undue influence
daughter, Ill report
you to the IBP. This Art. 1337. There is
is not unlawful undue influence when a
because the person person takes improper
did commit advantage of his power over
immorality. the will of another,
Sometimes, though, depriving the latter of a
it may constitute reasonable freedom of
intimidation. choice. The following
Example: A saw B circumstances shall be
commit murder. A considered: the
threatened B that confidentiality, family,
he will report him spiritual and other
to the police unless relations between the

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Professor Ruben F. Balane Page 232 of 241
 parties, or the fact that the when the other party had
person alleged to have been an opportunity to know the
unduly influenced was facts, are not in themselves
suffering from mental fraudulent.
weakness, or was ignorant
or in financial distress. Art. 1341. A mere
expression of an opinion
v. Fraud does not signify fraud,
unless made by an expert
Art. 1332. When one and the other party has
of the parties is unable to relied on the formers
read, or if the contract is in special knowledge.
a language not understood
by him, and mistake or Art. 1342.
fraud is alleged, the person Misrepresentation by a 3rd
enforcing the contract must person does not vitiate
show that the terms thereof consent, unless such
have been fully explained to misrepresentation has
the former. created substantial mistake
and the same is mutual.
Art. 1338. There is
fraud when, through Art. 1343.
insidious words or Misrepresentation made in
machinations of one of the good faith is not fraudulent
contracting parties, the but may constitute error.
other is induced to enter
into a contract which, Art. 1344. In order
without them, he would not that fraud may make a
have agreed to. contract voidable, it should
This is known as deceit or be serious and should not
dolo causante. This is have been employed by
different from dolo both contracting parties.
incidente which means Incidental fraud
fraud on things which would only obliges the person
not prevent you from employing it to pay
entering into a contract but damages.
may hold the other liable for
damages. If a 3rd person should
Requisites of Fraud commit violence or
1. Fraud is employed by 1 intimidation on 1 of the
party on the other contracting parties and this
(Articles 1342, 1344) vitiates the contracting
2. The other party was partys consent, then the
induced to enter into contract may be annulled
the contract (Article (Article 1336). By analogy,
1338) if a 3rd person should exert
3. The fraud must be undue influence on 1 of the
serious (Article 1344) contracting parties and this
4. There is damage or vitiates the consent of the
injury caused contracting party, then the
Art. 1339. Failure to contract may be annulled.
disclose facts, when there is However, if the 3rd party
a duty to reveal them, as commits fraud, damages is
when the parties are bound the only remedy unless the
by confidential relations, fraud committed by the 3 rd
constitutes fraud. person has created a mutual
substantial mistake (Article
Art. 1340. The usual 1342).
exaggerations in trade, Rules Regarding Voidable Contracts

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Professor Ruben F. Balane Page 233 of 241
 a. Voidable contracts are effective the incapacitated person is
unless set aside (Article 1390). not obliged to make any
b. The validity of a voidable contract restitution except insofar as
can only be assailed in a suit for that he has been benefited by the
purpose (i.e. complaint or thing or price received by
counterclaim). him (Article 1399).
The action for annulment of What if the Thing to Be
contracts may be instituted by Returned is Lost
all who are thereby obliged i. Loss due to Fault of
principally or subsidiarily. Defendant
However, persons who are Defendant has to
capable cannot allege the pay the plaintiff
incapacity of those with whom 1. Value of the
they contracted; nor can those thing loss
who exerted intimidation, 2. Fruits if any
violence, or undue influence, or 3. Interest
employed fraud, or caused ii. Loss due to a Fortuitous
,mistake base their action upon Event or due to a 3 rd
these flaws of the contract party
(Article 1397). Defendant has to
The action for annulment shall pay the plaintiff
be brought within 4 years. This 1. Value of the
period shall begin thing loss
i. Intimidation from the 2. Fruits if any
time the defect of the iii. Loss due to Fault or
consent ceases Fraud of Plaintiff
ii. Violence from the time The plaintiff loses
the defect of the consent the right to annul
ceases (Article 1401).
iii. Undue influence from the There is fault on the
time the defect of the part of the plaintiff
consent ceases once the plaintiff
iv. Mistake from the time of regains capacity.
the discovery of the mistake iv. Loss without Fault on
v. Fraud from the time of the the Plaintiffs Part
discovery of the fraud Commentators have
The 4 year prescription period a difference of
to annul contracts entered into opinion
by minors or other incapacitated 1. The right to
persons shall begin from the annul is
time the guardianship ceases extinguished
(Article 1391, 4th ). unless the
An obligation having been plaintiff offers
annulled, the contracting parties to pay the value
shall restore to each other the of the object at
things which have been the the time of loss
subject matter of the contract, 2. The plaintiff is
with their fruits, and the price entitled to
with its interest, except in cases annul without
provided by law (Article 1398, 1 st having to pay
). anything.
In obligations to render As long as 1 of the
service, the value thereof contracting parties does not
shall be the basis for restore what in virtue of the
damages (Article 1398, 2nd decree of annulment he is
). bound to return, the other
When the defect of the cannot be compelled to
contract consists in the comply with what is
incapacity of 1 of the parties,

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 incumbent upon him Confirmation may be effected by
(Article 1402). the guardian of the
The action for annulment will incapacitated person (Article
not prosper in the following: 1394).
i. If the contract has been 3. Unenforceable Contracts
confirmed (Article 1392)
ii. If the action to annul has Art. 1403. The following
prescribed (Article 1391) contracts are unenforceable, unless
iii. When the thing which is the they are ratified:
object of the contract is lost (1) Those entered into in the
through the fault or fraud of name of another person by
the person who has a right one who has been given no
to institute the proceedings authority or legal
(Article 1401, 1st ) representation, or who has
iv. Estoppel acted beyond his powers;
c. Voidable contracts can be (2) Those that do not comply
confirmed. with the Statute of Frauds as
Confirmation extinguishes the set forth in this number. In
action to annul a voidable the following cases an
contract (Article 1392). agreement hereafter made
Confirmation is the proper term shall be unenforceable by
for curing the defect of a action, unless the same, or
voidable contract. some note or memorandum,
Confirmation cleanses the thereof, be in writing, and
contract from all its defects subscribed by the party
from the moment it was charged, or by his agent;
constituted (Article 1396). evidence, therefore, of the
Requisites of Confirmation agreement cannot be
1. That the contract is a received without the writing,
voidable or annullable or a secondary evidence of its
contract contents:
2. That the ratification is made (a) An agreement that by its
with knowledge of the terms is not to be
cause for nullity performed within a year
3. That at the time the from the making
ratification is made, the thereof;
cause of nullity has already (b) A special promise to
ceased to exist answer for the debt,
Confirmation may be effected default, or miscarriage
expressly or tacitly. It is of another;
understood that there is tacit (c) An agreement made in
confirmation if, with knowledge consideration of
of the reason which renders the marriage, other than a
contract voidable and such mutual promise to
reason having ceased, the marry;
person who has a right to invoke (d) An agreement for the
it should execute an act which sale of goods, chattels
necessarily implies an intention or things in action, at a
to waive his right (Article 1393). price not less than five
d. Voidable contracts can be confirmed hundred pesos, unless
only by the party whose consent was the buyer accept and
vitiated receive part of such
goods and chattels, or
Confirmation does not require
the evidences, or some
the conformity of the
of them, of such things
contracting party who has no
in action or pay at the
right to bring the action for
time some part of the
annulment (Article 1395).
purchase money; but
when a sale is made by

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Professor Ruben F. Balane Page 235 of 241
 auction and entry is
made by the auctioneer Art. 1408. Unenforceable
in his sales book, at the contracts cannot be assailed by third
time of the sale, of the persons.
amount and kind of
property sold, terms of An unenforceable contract is a contract
sale, price, names of the which cannot be enforced by a proper
purchasers and person action in court, unless they are ratified,
on whose account the because either they are entered into
sale is made, it is a without or in excess of authority or they
sufficient do not comply with the Statute of Frauds
memorandum; or both the contracting parties do not
(e) An agreement of the possess the required legal capacity.
leasing for a longer The following contracts are
period than one year, or unenforceable unless they are ratified
for the sale of real (Article 1403)
property or of an a. Those entered into in the name of
interest therein; another person by 1 who has been
(f) A representation as to given no authority or legal
the credit of a third representation, or who has acted
person. beyond his powers
(3) Those where both parties are
incapable of giving consent to Art. 1317. No one may
a contract. contract in the name of
another without being
Art. 1404. Unauthorized authorized by the latter, or
contracts are governed by article 1317 unless he has by law a right to
and the principles of agency in Title X represent him.
of this Book. A contract entered into
in the name of another by one
Art. 1405. Contracts infringing who has no authority or legal
the Statute of Frauds, referred to in representation, or who has
No. 2 of article 1403, are ratified by acted beyond his powers, shall
the failure to object to the be unenforceable, unless it is
presentation of oral evidence to prove ratified, expressly or impliedly,
the same, or by the acceptance of by the person on whose behalf
benefit under them. it has been executed, before it
is revoked by the other
Art. 1406. When a contract is contracting party.
enforceable under the Statute of
Frauds, and a public document is When a person enters into a
necessary for its registration in the contract for and in the name of
Registry of Deeds, the parties may another, without authority to do
avail themselves of the right under so, the contract does not bind
Article 1357. the latter, unless he ratifies the
same.
Art. 1407. In a contract where The agent, who has entered into
both parties are incapable of giving the contract in the name of the
consent, express or implied purported principal, but without
ratification by the parent, or authority from him, is liable to
guardian, as the case may be, of one of 3rd persons upon the contract.
the contracting parties shall give the The proper term for this case is
contract the same effect as if only one ratification.
of them were incapacitated.
Example: In a sale, Y claimed
If ratification is made by the
that he was an agent of X, even
parents or guardians, as the case may
if not. The contract cannot be
be, of both contracting parties, the
enforced against X. Another
contract shall be validated from the
example is when the agent is
inception.
authorized to lease the property

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Professor Ruben F. Balane Page 236 of 241
 but the agent instead sells the guarantor, the promise
property. The principal is not must be in writing.
bound. iii. An agreement made in
b. Those that do not comply with the consideration of marriage, other
Statute of Frauds than a mutual promise to marry
This is the most famous variety. A mutual promise to marry
i. An agreement that by its terms does not fall within the
is not to be performed within a Statute of Frauds since they
year from the making thereof are not made in writing.
In Babao vs. Perez, the Agreements made in
Supreme Court interpreted consideration of marriage
the phrase not be to other than the mutual
performed within a year to promise to marry are within
mean that the obligation the Statute of Frauds.
cannot be finished within 1 In Cabague vs. Auxilio, the
year. Professor Balane does father of the groom
not agree with this promised to improve his
interpretation. According to daughter-in-laws fathers
Professor Balane the phrase house in consideration of
not to be performed within the marriage. The father of
a year should mean that the groom made
the obligation cannot begin improvements on the house.
within a year. For practical The wedding did not take
reasons, the contract must place. The Supreme Court
be in writing since the said that the father of the
parties might forget. This groom could not sue on the
rule was made to guard oral contract which as to
against fallibility him is not mutual promise
(forgetfulness) of man and to marry. Professor Balane
fraud. disagrees with the Supreme
According to Professor Court. According to
Balane, the Supreme Courts Professor Balane, the father
interpretation is incorrect. of the groom should be able
If the obligation cannot be to sue since there was
finished within 1 year, the partial performance.
contract is not within the iv. An agreement for the sale of
Statute of Frauds because of goods, chattels or things in
partial performance. action, at a price not less than
ii. A special promise to answer for P500, unless the buyer accepts
the debt, default or miscarriage and receives part of such goods
of another and chattels, or the evidence, or
The test as to whether a some of them, of such things in
promise is within the statute action, or pay at the time some
has been said to lie in the part of the purchase money; but
answer to the question when a sale is made by auction
whether the promise is an and entry is made by the
original or collateral one. If auctioneer in his sales book, at
the promise is an original the time of sale, of the amount
one or an independent one, and kind of property sold, terms
that is, if the promisor of sale, price, names of the
becomes thereby primarily purchasers and person on
liable for the payment of the whose account the sale is made,
debt, the promise is not it is a sufficient memorandum
within the statute. The requirement of a
If the promise is collateral written instrument or a
to the agreement of another memorandum for sales of
and the promisor becomes personal property for a price
merely a surety or not less than P500, covers
both tangible and intangible

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Professor Ruben F. Balane Page 237 of 241
 personal property. It also go after B if Bs
covers the assignment of representation was in
choses in action. writing.
Where a contract for the Professor Balane thinks that
sale of goods at a price not this does not belong in the
less than P500 is oral, and Statute of Frauds. There is
there is neither partial no contract between C and
payment or delivery, B. B did not bind himself to
receipt, and acceptance of pay C. What we have here is
the goods, the contract is an unenforceable tort.
unenforceable, and cannot According to Professor
be the basis of an action for Balane, a representation as
the recovery of the purchase to the credit of a 3rd person
price, or as the basis of an should be replaced by
action for damages for Article 1443. Article 1443
breach of the agreement. provides that no express
Where there is a purchase of trusts concerning an
a number of articles which immovable or any interest
taken separately does not therein may be proved by
have a price of P500 each, parol evidence.
but taken together, the price When the express trust
exceeds P500, the operation concerns an immovable or
of the statute of frauds an interest therein, a writing
depends upon whether is necessary to prove it.
there is a single inseparable This writing is not required
contract or a several one. If for the validity of the trust.
the contract is entire or It is required only for
inseparable, and the total purposes of proof. When
price exceeds P500, the the property subject to the
statute applies. But if the express trust, however is not
contract is separable, then real estate or an interest
each article is taken therein, then it may be
separately. proved by any competent
v. An agreement of lease for a evidence, including parol
period of more than 1 year, or evidence.
the sale of real property or of an c. Those where both parties are
interest therein incapable of giving consent to a
As long there is a sale of real contract
property, the sale must be in Neither party or his
writing. There is no representative can enforce the
minimum. contract unless it has been
An oral contract for a previously ratified. The
supplemental lease of real ratification by 1 party, however,
property for longer period converts the contract into a
than 1 year is within the voidable contract voidable at
Statute of Frauds. the option of the party who has
An agreement to enter into not ratified; the latter, therefore,
an agreement is also within can enforce the contract against
the Statute of Frauds. the party who has ratified. Or,
vi. A representation as to the credit instead, of enforcing the
of a 3rd person contract, the party who has not
A wants to borrow money ratified it may ask for
from C. C does not know A. annulment on the ground of his
C goes to B to ask about As incapacity.
credit standing. B says that The proper term is
As credit standing is acknowledgement (and not
satisfactory even though B ratification).
knows that A is insolvent. 2 Principles in the Statute of Frauds
Under Article 1403, C can

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Professor Ruben F. Balane Page 238 of 241
 a.Parol evidence is not admissible. Art. 1410. The action or
However, there are 2 ways of defense for the declaration of the
bringing it out. inexistence of a contract does not
2 Ways in Which Parol Evidence prescribe.
is Admissible
i. Failure to object by the A void contract is an absolute nullity and
opposing lawyer when parol produces no effect, as if it had never
evidence is used (Article been executed or entered into.
1405) The following contracts are inexistent
If there is no objection, and void from the beginning (Article
then parol evidence is 1409)
admitted. a. Those whose cause, object or
ii. Acceptance of benefits purpose is contrary to law, morals.
(Article 1405) Good customs, public order or
If there has been public policy
performance on 1 side b. Those which are absolutely
and the other side simulated or fictitious
accepts, then the c. Those whose cause or object did not
Statute of Frauds is not exist at the time of the transaction
applicable. Also, According to Professor Balane,
estoppel sets in so by Article 1409 (3) should not be
accepting performance, did not exist. Rather, the
the defect is waived. correct phrase should be could
b. The Statute of Frauds applies only to not come into existence
executory contracts and not to those because there can be a contract
which have been executed in whole over a future thing.
or in part. Examples of could not come
Executed here means there into existence are tangerine
has been performance in part flying elephants and cars
and acceptance by the other. running on urine.
4. Void Contracts d. Those whose object is outside the
commerce of men
Art. 1409. The following e. Those which contemplate an
contracts are inexistent and void from impossible service
the beginning: Here, there is no object.
(1) Those whose cause, object or f. Those where the intention of the
purpose is contrary to law, parties relative to the principal
morals, good customs, public object of the contract cannot be
order or public policy; ascertained
(2) Those which are absolutely This is similar to being void for
simulated or fictitious; vagueness under the
(3) Those whose cause or object Constitutional law.
did not exist at the time of the g. Those expressly prohibited or
transaction; declared void by law
(4) Those whose object is outside An example of this is sale
the commerce of men; between husband and wife,
(5) Those which contemplate an subject to exceptions. The
impossible service; Supreme Court has held that
(6) Those where the intention of contingent fees of lawyers
the parties relative to the wherein the latter receive part of
principal object of the the property subject of litigation
contract cannot be are valid, unless unconscionable
ascertained; in amount.
(7) Those expressly prohibited Characteristics of Void Contracts
or declared void by law. a. The contract produces no effect
These contracts cannot be whatsoever either against or in favor
ratified. Neither can the right to set up of anyone
the defense of illegality be waived.

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Professor Ruben F. Balane Page 239 of 241
 b. A judgment of nullity would be not be bound to comply with his
merely declaratory. There is no promise.
action for annulment necessary as
such is ipso jure. Art. 1412. If the act in
Even when the contract is void which the unlawful or forbidden
or inexistent, an action is cause consists does not constitute
necessary to declare its a criminal offense, the following
inexistence, when it has already rules shall be observed:
been fulfilled. Nobody can take (1) When the fault is on the
the law into his own hands. part of both contracting
The intervention of a parties, neither may
competent court is necessary to recover what he has given
declare the absolute nullity of by virtue of the contract,
the contract and to decree the or demand the
restitution of what has been performance of the
given under it. other's undertaking;
The judgment of nullity will (2) When only one of the
retroact to the very day when contracting parties is at
the contract was entered into. fault, he cannot recover
c. It cannot be confirmed, ratified or what he has given by
cured. reason of the contract, or
d. If it has been performed, the ask for the fulfillment of
restoration of what has been given is what has been promised
in order, except if pari delicto will him. The other, who is not
apply. at fault, may demand the
e. The right to set the contracts nullity return of what he has
cannot be waived given without any
f. The action for nullity is obligation to comply his
imprescriptible (Article 1410) promise.
As between the parties to a
contract, validity cannot be Articles 1411 and 1412 refer to the pari
given to it by estoppel if it is delicto rule, which literally means in
prohibited by law or is against equal kind, or also in equal guilt in
public policy. pari delicto oritur actio and sometimes
g. Any person can invoke the contracts in equal guilt, the position of the
nullity if its juridical effects are felt defendant is stronger in pari delicto
as to him potior est condicio defendentis. The
The defense of illegality of position of the defendant is stronger
contracts is not available to 3rd because the plaintiffs claim is not really
persons whose interests are not granted.
directly affected (Article 1421). The pari delicto rule applies only to
Pari Delicto (in equal guilt) contracts which is void for illegality of
Art. 1411. When the nullity subject matter. Thus, if the contract is
proceeds from the illegality of the void for simulation, the pari delicto rule
cause or object of the contract, and does not apply so a party can claim the
the act constitutes a criminal object back through reconveyance.
offense, both parties being in pari Outline:
delicto, they shall have no action a. If it constitutes a criminal offense
against each other, and both shall i. If both parties are in pari
be prosecuted. Moreover, the delicto
provisions of the Penal Code No action for specific
relative to the disposal of effects or performance can prosper on
instruments of a crime shall be either side (Article 1411, 1st
applicable to the things or the ).
price of the contract. No action for restitution can
This rule shall be applicable prosper on either side
when only one of the parties is (Article 1411, 1st ).
guilty; but the innocent one may Example: A shabu supplier
claim what he has given, and shall supplies shabu to the shabu

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Professor Ruben F. Balane Page 240 of 241
 dealer. If the shabu d. When the agreement is not illegal
supplier does not deliver the per se but is merely prohibited, and
shabu, the dealer cannot file the prohibition by law is designed
an action for specific for the protection of the plaintiff, he
performance. may, if public policy is enhanced,
ii. If only 1 party is guilty recover what he has paid or
No action for specific delivered (Article 1416).
performance can prosper on e. When the price of any article or
either side. commodity is determined by statute,
An action for restitution will or by authority of law, any person
be allowed only if the paying any amount in excess of the
innocent party demands. maximum price allowed may
The guilty party is not recover such excess (Article 1417).
entitled to restitution. f. When the law fixes, or authorizes
b. If it does not constitute a criminal the fixing of the maximum number
offense of hours of labor, and a contract is
i. If both parties are in pari entered into whereby a laborer
delicto undertakes to work longer than the
No action for specific maximum thus fixed, he may
performance can prosper on demand additional compensation
either side (Article 1411, 1st for service rendered beyond the time
). limit (Article 1418).
No action for restitution can g. When the law sets or authorizes the
prosper on either side setting of a minimum wage for
(Article 1411, 1st ). laborers, and a contract is agreed
ii. If only 1 party is guilty upon by which a laborer accepts a
No action for specific lower wage, he shall be entitled to
performance can prosper on recover the deficiency (Article
either side. 1419).
An action for restitution will The above contracts are void but
be allowed only if the there is some remedy for policy
innocent party demands. considerations. An example is the
minimum wage law under Article
Exceptions to Pari Delicto
1419 wherein the employer and the
a. Interest paid in excess of the interest
employee freely agree to the terms
allowed by the usury laws may be
of employment below the minimum
recovered by the debtor, with
wage. Although they are in pari
interest therefrom from the date of
delicto, you dont follow the rules of
payment (Article 1413)
pari delicto. There is a policy
b. When money is paid or property
consideration of social justice
delivered for an illegal purpose, the
involved. This is similar to the
contract may be repudiated by 1 of
preferential option for the poor of
the parties before the purpose has
churches.
been accomplished, or before any
damage has been caused to a 3rd Final Provisions
person. In such case, the courts Art. 1420. In case of a
may, if the public interest will thus divisible contract, if the illegal
be subserved, allow the party terms can be separated from the
repudiating the contract to recover legal ones, the latter may be
the money or property (Article enforced.
1414).
c. Where 1 of the parties to an illegal Art. 1421. The defense of
contract is incapable of giving illegality of contract is not
consent, the courts, may, if the available to third persons whose
interest of justice so demands, allow interests are not directly affected.
recovery of money or property
delivered by the incapacitated Art. 1422. A contract which
person (Article 1415). is the direct result of a previous
illegal contract, is also void and
inexistent.

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