2022 Jurists Pre-Week Pointers On Civil Law Part 1

JURISTS BAR REVIEW CENTER™
2022 Pre-Week Pointers on Civil Law Part 1
NOTES ON GENERAL PRINCIPLE AND case may be, will prevail. If the law provides
HUMAN RELATIONS that it shall take effect immediately, it means
that it shall take effect immediately after
Article 1. This Act shall be known as the "Civil publication.
Code of the Philippines." (n) • The effectivity provision refers to
all statutes, including those local and private
◦ The 1950 Civil Code of the laws.
Philippines took effect on August 30, 1950
Article 3. Ignorance of the law excuses no
Article 2. Laws shall take effect after fifteen one from compliance therewith. (2)
days following the completion of their
publication in the Official Gazette unless it is ◦ When a law is passed by the
otherwise provided. This Code shall take Congress, duly approved by the President of
effect one year after such publication. (1a) the Philippines, properly published, and
consequently becomes effective pursuant to
• EO No. 200, dated June 18, 1987- its effectivity clause or to some provision of
Laws shall take effect after fifteen days a general law on the effectivity of statutes,
following the completion of their publication the public is always put on constructive
either in the Official Gazette or in a notice of the law’s existence and effectivity.
newspaper of general circulation in the
Philippines, unless it is otherwise provided. Article 4. Laws shall have no retroactive
• When a statute does not explicitly effect, unless the contrary is provided. (3)
provide for its effectivity, it shall have effect
only after the expiration of the 15-day period • The law looks to the future and has
following the completion of its publication no retroactive effect unless the legislature
either in the Official Gazette or in a news may have given that effect to some legal
paper of general circulation in the provisions.
Philippines. • Instances when a law may be given
• Publication must be in full or it is retroactive effect:
not publication at all since its purpose is to 1. When the law expressly
inform the public of its contents. provides for retroactivity.
• Internet is not a medium for 2. When the law is curative or
publishing laws, rules and regulations. remedial.
(Garcillano vs. House of Representatives, 3. When the law is
G.R. No. 170338, December 23, 2008) procedural.
• The clause "unless it is otherwise 4. When the law is penal in
provided” solely refers to the 15-day period character and favorable to the
and not to the requirement of publication. accused.
Publication is an indispensable requisite; the
absence of which will not render the law Article 5. Acts executed against the
effective. provisions of mandatory or prohibitory laws
• If the law provides for a different shall be void, except when the law itself
period shorter or longer than the 15-day authorizes their validity. (4a)
period provided by Section 1 of E.O. No. 200, • A mandatory provision of law is
then such shorter or longer period, as the when the omission of which renders the
2022 Jurists Pre-week Pointers on Civil Law Part 1. For exclusive use of Jurists Bar reviewees. © 2022
by Jurists Review Center, Inc. Unauthorized copying, dissemination, sharing, uploading, downloading, and
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proceeding or acts to which it relates • In effect, judicial decisions,
generally illegal or void. although in themselves not laws, assume the
• Prohibitory laws are those which same authority as the statute itself and, until
contain positive prohibitions and are authoritatively abandoned, necessarily
couched in the negative terms importing become, to the extent that they are
that the act required shall not be done applicable, the criteria which must control
otherwise than designated. the actuations not only of those called upon
abide thereby but also those duty bound to
Article 6. Rights may be waived, unless the enforce obedience thereto.
waiver is contrary to law, public order, public • “legis interpretation legis vim
policy, morals, or good customs, or obtinet” - the interpretation placed upon the
prejudicial to a third person with a right written law by competent court has the
recognized by law. (4a) force of law.
• Waiver is the intentional Article 9. No judge or court shall decline to

relinquishment of a known right. render judgment by reason of the silence,
• Waivers cannot be made if they are obscurity or insufficiency of the laws. (6)
contrary to law, public order, public policy,
morals or good customs, or prejudicial to a ◦ Judges must not evade
third person with right recognized by law. performance of this responsibility just
because of an apparent non-existence of any
Article 7. Laws are repealed only by law governing a particular legal dispute or
subsequent ones, and their violation or non- because the law involved is vague or
observance shall not be excused by disuse, inadequate. He must always be guided by
or custom or practice to the contrary. When equity, fairness, and a sense of justice in
the courts declared a law to be inconsistent these situations.
with the Constitution, the former shall be
void and the latter shall govern. Article 10. In case of doubt in the
Administrative or executive acts, orders and interpretation or application of laws, it is
regulations shall be valid only when they are presumed that the lawmaking body
not contrary to the laws or the Constitution. intended right and justice to prevail. (n)
(5a)
◦ If there is ambiguity in the law,
• Repeal of a law is the legislative act interpretation of the law requires fidelity to
of abrogating through a subsequent law the the legislative purpose. What Congress
effects of a previous statute or portions intended is not to be frustrated. Its objective
thereof. Repeal is either express or implied. must be carried out. Even if there be doubt
An implied repeal takes place when a new as to the meaning of the language employed,
law contains provisions contrary to or the interpretation should not be at war with
inconsistent with those of a former without the end sought to be attained.
expressly repealing them.
• The Constitution is the supreme, Article 11. Customs which are contrary to
organic, and fundamental law of the land. It law, public order or public policy shall not be
is axiomatic that no ordinary statute can countenanced. (n)
override a constitutional provision.
Article 12. A custom must be proved as a
Article 8. Judicial decisions applying or fact, according to the rules of evidence. (n)
interpreting the laws or the Constitution
shall form a part of the legal system of the ◦ Customs has been defined as a rule
Philippines. (n) of conduct formed by repetition of acts,
charges.
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uniformly observed (practiced) as a social succession and the amount of successional
rule, legally binding and obligatory. rights, whether in intestate or testamentary
succession, they shall be regulated by the
Article 13. When the laws speak of years, national law of the deceased and this is
months, days or nights, it shall be applicable regardless of the nature of the
understood that years are of three hundred property.
sixty-five days each; months, of thirty days;
days, of twenty-four hours; and nights from Article 17. The forms and solemnities of
sunset to sunrise. If months are designated contracts, wills, and other public
by their name, they shall be computed by the instruments shall be governed by the laws of
number of days which they respectively the country in which they are executed.
have. In computing a period, the first day When the acts referred to are executed
shall be excluded, and the last day included. before the diplomatic or consular officials of
(7a) the Republic of the Philippines in a foreign
country, the solemnities established by
Article 14. Penal laws and those of public Philippine laws shall be observed in their
security and safety shall be obligatory upon execution. Prohibitive laws concerning
all who live or sojourn in the Philippine persons, their acts or property, and those
territory, subject to the principles of public which have for their object public order,
international law and to treaty stipulations. public policy and good customs shall not be
(8a) rendered ineffective by laws or judgments
promulgated, or by determinations or
Article 15. Laws relating to family rights and conventions agreed upon in a foreign
duties, or to the status, condition and legal country. (11a)
capacity of persons are binding upon citizens
of the Philippines, even though living • The forms and solemnities of public
abroad. (9a) instruments, wills, and contracts shall be
governed by the laws of the country where
◦ Regardless of where a citizen of the they are executed.
Philippines may be, he or she will be • Diplomatic and consular officials
governed by Philippine laws with respect to are representatives of the state. Hence, any
his or her family rights and duties, or to his acts or contract made in a foreign country
or her status, condition, and legal capacity. before diplomatic and consular officials must
conform to the solemnities under Philippine
Article 16. Real property as well as personal law.
property is subject to the law of the country
where it is stipulated. However, intestate Article 18. In matters which are governed by
and testamentary successions, both with the Code of Commerce and special laws,
respect to the order of succession and to the their deficiency shall be supplied by the
amount of successional rights and to the provisions of this Code. (16a)
intrinsic validity of testamentary provisions,
shall be regulated by the national law of the Article 19. Every person must, in the exercise
person whose succession is under of his rights and in the performance of his
consideration, whatever may be the nature duties, act with justice, give everyone his
of the property and regardless of the country due, and observe honesty and good faith.
wherein said property may be found. (10a)
◦ Article 19 provides a rule of conduct
◦ The law of the country where the that is consistent with an orderly and
real property is situated shall be the harmonious relationship between and
governing law over such real property. among men and women. It codifies the
However, with respect to the order of concept of what is justice and fair play so
charges.
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that the abuse of right by a person will be ◦ The courts must render justice and,
prevented. therefore, they must be very vigilant in
protecting the rights of the disadvantaged
Article 20. Every person who, contrary to with the end in view that any decision will be
law, willfully or negligently causes damage to in consonance with that is right and legal.
another, shall indemnify the latter for the
same. Article 25. Thoughtless extravagance in
◦ Article 20 speaks of the general expenses for pleasure or display during a
sanction for all other provisions of law which period of acute public want or emergency
do not especially provide their own sanction. may be stopped by order of the courts at the
instance of any government or private
Article 21. Any person who willfully causes charitable institution.
loss or injury to another in manner that is
contrary to morals, good customs or public ◦ The law seeks to prevent
policy shall compensate the latter for the inconsiderate and ostentatious activities
damage. during times of emergency.
◦ Insofar as Article 21 is concerned, it Article 26. Every person shall respect the
was designed to fill in the “countless gaps in dignity, personality, privacy and peace of
the statutes, which leave so many victims of mind of his neighbors and other persons. The
moral wrongs helpless, even though they following and similar acts, though they may
have actually suffered material and moral not constitute a criminal offense, shall
injury” produce a cause of action for damages,
prevention and other relief:
Article 22. Every person who through an act
of performance by another, or any other (1) Prying into the privacy of
means, acquires or comes into possession of another's residence;
something at the expense of the latter (2) Meddling with or disturbing the
without just or legal ground, shall return the private life or family relations of another;
same to him. (3) Intriguing to cause another to be
alienated from his friends;
Article 23. Even when an act or event (4) Vexing or humiliating another on
causing damage to another's property was account of his religious beliefs, lowly station
not due to the fault or negligence of the in life, place of birth, physical defect, or other
defendant, the latter shall be liable for personal condition.
indemnity if through the act or event he was • The touchstone of every
benefited. system of laws, of the culture and
civilization of every country, is how
◦ No person can claim what is not far it dignifies man.
validly and legally his or hers. Hence, he or • If human personality is not
she should not unduly profit on something properly exalted – then the laws are
which does not meritoriously belong to him indeed defective.
or her.
Article 27. Any person suffering material or
Article 24. In all contractual, property or moral loss because a public servant or
other relations, when one of the parties is at employee refuses or neglects, without just
a disadvantage on account of his moral cause, to perform his official duty may file an
dependence, ignorance, indigence, mental action for damages and other relief against
weakness, tender age or other handicap, the the latter, without prejudice to any
courts must be vigilant for his protection. disciplinary administrative action that may
be taken.
charges.
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◦ A public official is supposed to be an Article 30. When a separate civil action is
agent or at least a representation of the brought to demand civil liability arising from
government; therefore, the law exacts on a criminal offense, and no criminal
him or her, an obligation to be very vigilant proceedings are instituted during the
and just so that the public can be assured pendency of the civil case, a preponderance
that the government is truly effective in of evidence shall likewise be sufficient to
servicing their needs. prove the act complained of.
Article 28. Unfair competition in agricultural, Article 31. When the civil action is based on
commercial or industrial enterprises or in an obligation not arising from the act or
labor through the use of force, intimidation, omission complained of as a felony, such civil
deceit, machination or any other unjust, action may proceed independently of the
oppressive or highhanded method shall give criminal proceedings and regardless of the
rise to a right of action by the person who result of the latter.
thereby suffers damage.
◦ This provision evidently refers to a
◦ This is necessary in a system of free civil action based, not on the act or omission
enterprise. Democracy becomes a veritable charged as a felony in a criminal case, but
mockery if any person or group of persons by based on an obligation arising from other
any unjust or highhanded method may sources, such as law or contract.
deprive others of a pair chance to engage in
business or earn a living. Article 32. Any public officer or employee, or
any private individual, who directly or
Article 29. When the accused in a criminal indirectly obstructs, defeats, violates or in
prosecution is acquitted on the ground that any manner impedes or impairs any of the
his guilt has not been proved beyond following rights and liberties of another
reasonable doubt, a civil action for damages person shall be liable to the latter for
for the same act or omission may be damages:
instituted. Such action requires only a
preponderance of evidence. Upon motion of (1) Freedom of religion;
the defendant, the court may require the (2) Freedom of speech;
plaintiff to file a bond to answer for damages (3) Freedom to write for the press or
in case the complaint should be found to be to maintain a periodical publication;
malicious. If in a criminal case the judgment (4) Freedom from arbitrary or illegal
of acquittal is based upon reasonable doubt, detention;
the court shall so declare. In the absence of (5) Freedom of suffrage;
any declaration to that effect, it may be (6) The right against deprivation of
inferred from the text of the decision property without due process of law;
whether or not the acquittal is due to that (7) The right to a just compensation
ground. when private property is taken for public
use;
• Proof beyond reasonable doubt (8) The right to the equal protection
means that amount of proof which forms an of the laws;
abiding moral certainty that the accused (9) The right to be secure in one's
committed the crime charged. person, house, papers, and effects against
• If the guilt of the accused is not unreasonable searches and seizures;
proven beyond reasonable doubt, a civil (10) The liberty of abode and of
action to prove the civil liability can still be changing the same;
filed where only preponderance of evidence (11) The privacy of communication
is needed. and correspondence;
charges.
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(12) The right to become a member these reasons:
of associations or societies for purposes not
contrary to law; 1. In most cases, the threat to
(13) The right to take part in a freedom originates from abuses of power of
peaceable assembly to petition the government officials and peace officers.
Government for redress of grievances; 2. Even when the prosecuting
(14) The right to be a free from attorney filed a criminal action, the
involuntary servitude in any form; requirement of proof beyond reasonable
(15) The right of the accused against doubt often prevented the appropriate
excessive bail; punishment.
(16) The right of the accused to be 3. Direct and open violations of the
heard by himself and counsel, to be Penal Code trampling upon the freedoms
informed of the nature and cause of the named are not so frequent as those subtle,
accusation against him, to have a speedy and clever, and indirect ways which do not come
public trial, to meet the witnesses face to within the pale of the penal law.
face, and to have compulsory process to
secure the attendance of witness in his Article 33. In cases of defamation, fraud, and
behalf; physical injuries a civil action for damages,
(17) Freedom from being compelled entirely separate and distinct from the
to be a witness against one's self, or from criminal action, may be brought by the
being forced to confess guilt, or from being injured party. Such civil action shall proceed
induced by a promise of immunity or reward independently of the criminal prosecution,
to make such confession, except when the and shall require only a preponderance of
person confessing becomes a State witness; evidence.
(18) Freedom from excessive fines, or
cruel and unusual punishment, unless the Article 34. When a member of a city or
same is imposed or inflicted in accordance municipal police force refuses or fails to
with a statute which has not been judicially render aid or protection to any person in
declared unconstitutional; and case of danger to life or property, such peace
(19) Freedom of access to the courts. officer shall be primarily liable for damages,
In any of the cases referred to in this article, and the city or municipality shall be
whether or not the defendant's act or subsidiarily responsible therefor. The civil
omission constitutes a criminal offense, the action herein recognized shall be
aggrieved party has a right to commence an independent of any criminal proceedings,
entirely separate and distinct civil action for and a preponderance of evidence shall
damages, and for other relief. Such civil suffice to support such action.
action shall proceed independently of any
criminal prosecution (if the latter be Article 35. When a person, claiming to be
instituted) and may be proved by a injured by a criminal offense, charges
preponderance of evidence. The indemnity another with the same, for which no
shall include moral damages. Exemplary independent civil action is granted in this
damages may also be adjudicated. The Code or any special law, but the justice of the
responsibility herein set forth is not peace finds no reasonable grounds to
demandable from a judge unless his act or believe that a crime has been committed, or
omission constitutes a violation of the Penal the prosecuting attorney refuses or fails to
Code or other penal statute. institute criminal proceedings, the complaint
may bring a civil action for damages against
• The creation of an absolutely the alleged offender. Such civil action may
separate and independent civil action for the be supported by a preponderance of
violation of civil liberties is essential to the evidence. Upon the defendant's motion, the
effectively maintenance of democracy, for court may require the plaintiff to file a bond
charges.
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to indemnify the defendant in case the entities which are considered
complaint should be found to be malicious. persons only by recognition of law.
If during the pendency of the civil action, an
information should be presented by the Capacity
prosecuting attorney, the civil action shall be
suspended until the termination of the Juridical capacity
criminal proceedings.
 The fitness to be the subject of legal
◦ When a criminal action is instituted, relations
the civil action for the recovery of civil  Inherent in every natural person and
liability arising from the offense charged is lost only through death
shall be deemed instituted with the criminal  A passive condition, the aptitude of
action uncles the offended party waives the holding and enjoyment of rights
civil action, reserves his right to institute it
separately or institutes the civil action prior Capacity to Act
to the criminal action. Article 36. Pre-judicial
questions, which must be decided before  The power to do acts with legal effect
any criminal prosecution may be instituted  An active condition, the aptitude for
or may proceed, shall be governed by rules the exercise of rights
of court which the Supreme Court shall
promulgate and which shall not be in conflict Age of Legal Capacity = 18
with the provisions of this Code.
 Basis:
• A prejudicial question is one that ◦ Art. 1327, CC provides that
arises in a case, the resolution of which is a minors cannot give consent
logical antecedent of the issue involved to a contract
therein, and the cognizance of which ◦ Art. 234, FC, as amended by
pertains to another tribunal. RA 6809, provides that the
• There are two essential elements of age of majority is 18 years
a prejudicial question, to wit:
1. The civil action involves an Capacity to Act Juridical Capacity
issue similar or intimately related to
the issue raised in the criminal Power to buy and Capacity to succeed
action; and own land to the estate
2. The resolution of such issue
determines whether or not criminal Power to enter into Capacity to be
action may proceed (Section 5, Rule contracts designated as
111 of the Rules of Court) beneficiary in an
insurance policy
NOTES ON PERSONS
Power to dispose Capacity to receive
property donations
Person – any being or entity susceptible of Power to buy pre- Capacity to be
rights and obligations or of being the need plans designated as
subject of legal relations beneficiary in an
educational plan
Types of Persons
 Natural Persons – human beings
 Juridical Persons – entities formed
by association of human beings.
They are artificial and intangible
charges.
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contracts, except
Factors that Affect Capacity when done during
lucid interval
Circumstance Effect (Relative)
Minority Incapable of State of being deaf- Incapable of

entering into mute entering into
contracts contracts, but can
(Absolute) execute a will
(Relative)
Imbecility Incapable of
entering into Prodigality A ground for
contracts putting a person
(Absolute) under guardianship
(Relative)
Civil interdiction Incapable of
exercising parental
authority or Commencement of Personality
guardianship,
marital authority  Natural Persons
and the right to ◦ It begins from conception,
manage or dispose provided:
property (Relative)  the fetus (with an
intra-uterine life of at
Family relations Relative incapacity least seven months) is
to marry and sell or alive at the time it is
donate to one completely delivered
another from the mother’s
womb. (Art. 5, PD 603,
Insolvency Incapable of Art. 41, CC)
disposing property  If the fetus had an
or receiving intra-uterine life of
payments less than seven
(Relative) months, it must
Absence Ground for survive at least 24
appointment of a hours after its
representative complete delivery.
(Relative) (Art. 41, CC)
Trusteeship Incapable of  Juridical Persons

exercising parental ◦ Personality is acquired in
authority or accordance with the law
guardianship, creating or recognizing them
marital authority
and the right to  Private corporations
manage or dispose and foundations -
property (Relative) upon issuance of
Certificate of
Insanity Incapable of Incorporation by the
entering into
charges.
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SEC (Sec. 18, Revised  In this jurisdiction
Corporation Code) there are ample
precedents to show
 Partnerships – upon that the estate of a
execution of the deceased person is
contract (Art. 1784, also considered as
CC) having legal
personality
 Public corporations – independent of their
upon effectivity of the heirs.
law creating them  Under the present
(unless the law legal system, such
provides otherwise, rights and obligations
e.g. issuance of IRR, as survive after death
actual constitution) have to be exercised
and fulfilled only by
 Under Section 14 of the estate of the
the Local Government deceased. And if the
Code, when a new same legal fiction
local government unit were not indulged,
is created, its there would be no
corporate existence juridical basis for the
shall commence upon estate, represented
the election and by the executor or
qualification of its administrator, to
chief executive and a exercise those rights
majority of the and to fulfill those
members of its obligations of the
sanggunian, unless deceased
some other time is
fixed therefor by the Dissolution
law or ordinance
creating it.  It is any legal event or cause that
terminates a legal entity
Death ◦ Private Corporations are
dissolved in accordance with
 Death extinguishes civil personality the Corporation Code and
(art. 42, CC) SEC Rules
◦ If the right or obligation is not ◦ Partnerships are dissolved in
personal and is not accordance with the Civil
extinguished by death, the Code
heirs will succeed to the right  Dissolution may be voluntary or
or obligation. involuntary
◦ The case of Limjoco vs. Use of Surnames

Intestate Estate of Pedro O.
Fragrante, L-770, April 27,  Ours is a patriarchal society. By
1948: passing on the father’s surname, we
adopt the patriarchal heritage, that
people can trace their roots
charges.
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according to their father’s name and
their father’s father’s name. ◦ the record of birth appearing
 Women adopt the surname of their in the civil register,
husband to assure that their children ◦ when an admission is made in
will be able to adopt the surname of a public document
the husband. ◦ when an admission is made in
 This is criticized by some as private handwritten
discrimination against women. instrument
Rules on Surnames of Children  An Affidavit to Use the Surname of

the Father (AUSF) may be executed
 Legitimate and legitimated children by the child, his or her mother, or his
shall principally use the surname of or her guardian, provided the father
their father. (Art. 364, CC) has already admitted the filiation.
◦ Included are children who  Where and what to File:

were conceived or born
before the decree annulling  If birth was in the Philippines – File
or voiding a marriage (Art. any of the following:
365, CC) ◦ Affidavit of Admission of
Paternity,
◦ An adopted child shall bear ◦ Private handwritten
the surname of the adopter instrument, or
(Art. 365, CC) ◦ Affidavit to Use the Surname
 If both spouses of Father
adopted the child, the ◦ At the Local Civil Registry
adopted child shall Office (LCRO) of the place of
adopt the surname of birth.
the adoptive father.
 If birth was outside the Philippines –
Q: May a legitimate or legitimated child File any of the following:
use the surname of the mother, instead? ◦ Affidavit of Admission of
Paternity,
A: Yes. Indeed, [Art. 364] states that ◦ Private handwritten
legitimate children shall "principally" use the instrument, or
surname of the father, but "principally" does ◦ Affidavit to Use the Surname
not mean "exclusively.“ However, the of Father
reasons for the change of name must be ◦ At the Philippine Foreign
sufficiently established as well. (Alanis vs. Service Post (PFSP) like
Court of Appeals, G.R. No. 216425, embassies, missions and
November 11, 2020) consular offices nearest to the
place of residence of the
 Illegitimate children shall bear the person concerned (father,
surname of the mother (Art. 368, CC, child, his mother or guardian)
Art. 176, FC)
Rules on Surname of Married Women
 Under RA 9255, illegitimate children
may use the surname of their father  A married woman MAY use: (Art.
if their filiation has been expressly 370, Civil Code)
recognized by the father through:
charges.
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◦ Her maiden first name and administrator of his
surname and add her property
husband’s surname. Example:
Maria Cruz Reyes (Reyes
being her husband’s ◦ Effect:
surname)
 An administrator of
◦ Her maiden first name and the absentee’s
her husband’s surname. property shall be
Example: Maria Reyes appointed
 If the present wife is
◦ Her husband’s full name, but appointed
prefixing a word indicating administratrix, she
that she is his wife, such as cannot alienate or
“Mrs.” Example: Mrs. Pedro encumber the
Reyes (Pedro being her husband’s property
husband’s first name) without judicial
authority. Note: No
 When Married Woman to revert to similar rule in case the
her Maiden Name: (Art. 371-372, CC) present husband is
the administrator
◦ In case of annulment of
marriage, and the wife is the Presumption of Death
guilty party (mandatory)
 For all purposes = absence of 7 years
◦ In case of annulment of (Art. 390, CC)
marriage, and the wife is the
innocent spouse (optional).  For purposes of opening succession:
But: (Art. 391, CC)
 It is mandatory if the ◦ 10 years (ordinary)

court so orders; and ◦ 5 years (if the absentee was
 It is mandatory if she 75 years old at the time)
or her husband ◦ 4 years (extraordinary, where
remarries. there is danger of death)
◦ Note: in case of legal  For purposes of remarriage: (Art. 41,

separation (no change) FC)
Absence ◦ 4 years (ordinary)

◦ 2 years (extraordinary, where
 When a person disappears from his there is danger of death)
domicile and his whereabouts are
unknown  Extraordinary circumstances where
there is danger of death:
◦ Declaration of absence:
◦ A person on board a vessel
 2 years; or lost during a sea voyage, or an
 5 years, in case the airplane which is missing;
absentee has left an
charges.
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◦ A person in the armed forces  Its purpose is to establish conjugal
who has taken part in war; and family life.
and
◦ A person who has been in As a special contract:
danger of death under other
circumstances.  It is not the same as ordinary
Note: A petition to declare a person contracts insofar as its creation,
presumptively dead is required only for consummation and consequences
purposes of remarriage under Article 41 of are concerned. Thus:
the Family Code. A petition whose sole  It cannot be formed by
objective is to declare a person implication or estoppel.
presumptively dead under the Civil Code is  It does not require a
not a viable suit in our jurisdiction. In order particular form for its validity.
to avail of the presumption, therefore, the  The freedom to contract or
claimant need only present any "evidence" autonomy of parties does not
which shows that the concerned person had apply.
been missing for such number of years and
or under the circumstances prescribed As a permanent union:
under Articles 390 and 391 of the Civil Code.
(Tadeo-Matias vs. Republic, G.R. No. 230751,  It is meant to last “till death do us
April 25, 2018) part”.
 It is not a contract for a particular or
NOTES ON MARRIAGE temporary purpose.
 The parties cannot stipulate an
What is Marriage? expiration date.
 It cannot be terminated, except for
 It is a special contract of permanent reasons provided by law such as
union between a man and a woman death, annulment or nullity of the
entered into in accordance with law marriage.
for the establishment of conjugal and
family life. It is the foundation of the As a union between a man and a woman:
family and an inviolable social
institution whose nature,  Only a man and a woman can enter a
consequences, and incidents are marriage.
governed by law and not subject to  Same-sex marriage is not allowed.
stipulation, except that marriage  It cannot even be made between
settlements may fix the property persons of the same sex, one of
relations during the marriage within whom has undergone sexual
the limits provided by this Code. (Art. reassignment (See Silverio vs.
1, FC) Republic).
POINTS TO REMEMBER FROM THE As a union entered in accordance with law:

DEFINITION:
 Its nature, consequences, and
 It is a special contract. incidents are governed by law and
 It is a permanent union. not subject to stipulation.
 It is a union between a man and a  Except for marriage settlements, the
woman. parties cannot contract away their
 It is a union entered in accordance rights and obligations.
with law.  Any change or modification in the
aspects of marriage, such as property
charges.
Page 12 of 117
relations, support and parental  The consent must be freely given
authority, must be through court and not obtained through duress or
order. fraud.
 If the consent is vitiated, the
As a union whose purpose is to establish marriage is voidable (Art. 45,
conjugal and family life: FC)
 If there is a mistake by one
 The cause of the parties is not party as to the identity of the
monetary or proprietary gain. other, the marriage is void
 The parties must live together, (Art. 35, FC)
observe mutual love, respect and  The consent must be given in the
fidelity. presence of the solemnizing officer.
 If they have children, the parties
must jointly exercise parental On Authority of the Solemnizing Officer:
authority and provide support.
 The following persons may
Requisites of Marriage solemnize a marriage:
 Any incumbent member of
 Essential requisites the judiciary within the
 Legal capacity court’s jurisdiction
 Consent  Appellate court
justices may
 Formal requisites solemnize marriage
 Authority of the solemnizing anywhere in the
officer Philippines
 Valid marriage license  Trial court judges may
 Marriage ceremony solemnize marriage
only within their
On Legal Capacity: respective jurisdiction
 Any priest, rabbi, imam or
 Each party must be at least 18 years minister of any church or
old. religious sect, provided that:
 The parties must be a man and a
woman.  The priest, etc. is duly
 There must be no legal impediment authorized by his
like family relations or a subsisting church or religious
prior marriage. sect and acts within
 If the parties are closely the limits of such
related (e.g. ascendants and written authority;
descendants, or siblings), the  The priest, etc. is
marriage is void for being registered with the
incestuous (Art. 37, FC) civil registrar general;
 If one or both parties are and
already married, the marriage  At least one of the
is void for being bigamous contracting parties
(Art. 35, FC) belongs to the
solemnizing officer’s
On Consent: church or religious
sect.
charges.
Page 13 of 117
 Any ship captain or airplane believing that the solemnizing
chief, provided that: officer had authority.
 If the solemnizing officer acted
 The marriage is in outside of his jurisdiction, the
articulo mortis; marriage is not void. It is a mere
 The marriage is irregularity which renders the
between passengers solemnizing officer administratively
or crew members; liable.
and
 The marriage is On the marriage ceremony:
performed while the
ship is at sea or the  No prescribed form or religious rite
plane is in flight, or for the solemnization of the
during stopovers at marriage is required.
ports of call.  Requirements:
 Any military commander of a  The parties must appear

unit, provided that: personally before the
solemnizing officer
 The marriage is in  The parties must declare that
articulo mortis; they take each other as
 The marriage is husband and wife; and
performed during a  The declaration must be in
military operation; the presence of at least 2
 The marriage is witnesses.
between persons
within the zone of  The marriage shall be solemnized
military operation, publicly in the chambers of the
whether members of judge or in open court, in the
the armed forces or church, chapel or temple, or in the
civilians; office of the consul or mayor.
 The military
commander is a  When the marriage may be
commissioned officer; solemnized in a different
and venue:
 The chaplain assigned  Marriage on the point
to the military unit is of death or in articulo
absent. mortis;
 Marriage in remote
 Any consul-general, consul or vice places where there is
consul of the Philippines, in no means of
marriages between Filipino citizens transportation;
abroad  Upon request in
 A municipal or city mayor. writing of the parties
Note: On the marriage license:
 Marriages solemnized by persons  It is issued by the local civil registrar

without authority are void, unless of the city or municipality whether
the parties were in good faith, either contracting party habitually
charges.
Page 14 of 117
resides, upon application separately  Valid for 120 days from the date of
filed by the parties; issuance
 The local civil registrar shall verify  Valid to be used anywhere in the
the legal capacity of the parties by Philippines
requiring their birth certificates and,  Upon expiration of the 120-day
if applicable, proof that a previous period, the marriage license is
marriage has been terminated by legally inexistent or void
death or by a judicial decree
 In case of a foreigner Exemption from the Marriage License
applicant, he/she must Requirement:
submit a certificate of legal
capacity from his/her  In case either or both of the
consular office. contracting parties are at the
point of death,
 If the residence of either
*Parental Consent or Advice: party is so located that there
is no means of transportation
 Parental (or guardian’s) consent is to enable such party to
required if the contracting party is appear personally before the
between 18 and 21 years old. local civil registrar,
Without the parental consent, the  Marriages among Muslims or
marriage license will not be issued. among members of the
 Parental (or guardian’s) advice is ethnic cultural communities,
required if the contracting party is and
between 21 and 25 years old. If  In case the man and the
there is no such advice, the marriage woman have lived together
license will not be issued until after as husband and wife for at
3 months following the publication least five years and without
of the application for marriage any legal impediment to
license by posting for 10 consecutive marry each other.
days
MIXED MARRIAGES
*Marriage counselling:
 A mixed marriage is a marriage
 Required when parental consent or between a Filipino citizen and a
parental advice is required foreigner, whether celebrated here
 Marriage counselling shall be or abroad.
conducted by the priest, imam or
minister authorized to solemnize  Extrinsic validity is governed by lex
marriage, or a government- loci celebrationis (Art. 26, Family
accredited marriage counsellor. Code). If it is valid in the place where
 If no certificate of marriage it was celebrated, it is valid here in
counselling is submitted, the the Philippines.
marriage license will not be issued  Extrinsic validity refers to the
until after three months following formalities or formal
the publication of the application for requisites, such as authority
marriage license of the solemnizing officer,
marriage license, and
*Validity: marriage ceremony.
charges.
Page 15 of 117
 Intrinsic validity governed by the • Bigamous or polygamous marriages
national law of the parties (art. 35[4])
• Void due to mistake (art. 35[5])
 Intrinsic validity goes into the • Void for being incestuous (art. 37)
essential requisites of • Void for being contrary to public
marriage, such as legal policy (art. 38)
capacity and consent. Thus: • Void second marriage (art. 53)
 If the Filipino spouse • Note:

was a minor at the
time of the marriage, • Actions to declare a marriage
the marriage is void void do not prescribe. (art.
even if at the place of 39). But the right of action is
celebration of the lost when either or both
marriage, a minor spouses die.
may marry. Philippine • for purposes of remarriage,
law on status and there must be a declaration
capacity applies to of nullity of marriage
Filipinos and follow
them wherever they Void marriage due to Psychological
may be. Incapacity
DIVORCE OBTAINED ABROAD • Basis
Art. 26, second paragraph, of the Family • Art. 36, Family Code – a
Code, provides: marriage contracted by any
party who, at the time of the
Where a marriage between a Filipino celebration, was
citizen and a foreigner is validly celebrated psychologically incapacitated
and a divorce is thereafter validly obtained to comply with the essential
abroad by the alien spouse capacitating him marital obligations of
or her to remarry, the Filipino spouse shall marriage, shall likewise be
likewise have capacity to remarry under void even if such incapacity
Philippine law. becomes manifest only after
its solemnization.
 The former interpretation is that it
should be the foreigner spouse who Pre-Tan-Andal vs. Andal Interpretation
had obtained the divorce. If it was
the Filipino spouse who secured the • Concept
divorce, Article 26 is not applicable • It is the inability to comply
and the divorce obtained by the with the essential marital
Filipino spouse will not capacitate obligations of marriage of one
him/her to remarry. or both of the parties
• It must be more than just a
NOTES ON THE difficulty, refusal or neglect in
VOID AND VOIDABLE MARRIAGES the performance of the
marital obligations
VOID MARRIAGES • It is characterized by:
• Gravity
• Void due to absence of essential AND • Juridical antecedence
FORMAL requisites (Art. 35[1-3]) • Incurability
charges.
Page 16 of 117
medically or clinically
• The burden of proof rests with the identified; hence, expert
plaintiff opinion is not required.
• The root cause of the psychological • It must be caused by a

incapacity must be: durable aspect of one’s
personality structure.
• Medically or clinically
identified • Marital obligations, inclusion
• Alleged in the complaint
• Sufficiently proven by experts • Their obligations to their
• Explained in the decision children become part of their
obligations to each other as
• The incapacity must be existing at the spouses. However, the failure
time of the celebration of the to meet the obligations to the
marriage children must be of such
grievous nature that it
• The incapacity must be permanent or reflects on the capacity one of
incurable one spouses for marriage.
• The illness is grave enough to prevent
the party from assuming the • GUIDELINES:
essential marital obligations
• The psychological incapacity
• The marital obligations are the must be shown to have been
obligations to live together, to existing at the time of the
observe mutual love, respect and celebration of the marriage.
fidelity, to render mutual help and (JURIDICAL ANTECEDENCE)
support
• It must be shown to be a
• The interpretations of the national serious or dangerous illness,
appellate matrimonial tribunal of the but that “mild
catholic church shall be given great characterological
respect peculiarities, mood changes,
occasional emotional
• The trial court must order the outbursts” are excluded. The
prosecutor and the solicitor general psychologica incapacity
to appear for the state cannot be mere “refusal,
neglect, or diffiiculty, much
Tan-Andal vs. Andal, G.R. No. 196359, less ill will. In other words, it
May 11, 2021 must be shown that the
incapacity is caused by a
• Concept: genuinely serious psychic
• Psychological incapacity cause. (GRAVITY)
consists of clear acts of
dysfunctionality that show a • It is incurable, not in the
lack of understanding and medical, but in the legal
concomitant compliance with sense. This means that the
one’s essential marital incapacity is so enduring and
obligations due to psychic persistent with resoect to a
causes. It is not a medical specific partner, and
illness that has to be contemplates a situation
charges.
Page 17 of 117
where the couple’s respective them in equal shares and the
personality structures are so property acquired by both of
incompatible and them through their work or
antagonistic that the only industry shall be governed by
result of the union would be the rules on co-ownership.
the inevitable and irreparable
breakdown of the marriage, EXPERT WITNESS
(INCURABILITY)
• Opinions of experts like psychologists
• On expert testimony and are important evidence and carries
examination of the spouse alleged to weight and may in some cases be
be psychologically incapacitated: decisive in a case. The actual medical
examination should be dispensed
• Personal examination of the with only if the totality of evidence
allegedly psychologically presented is enough to support a
incapacitated spouse is not finding of psychological incapacity.
required for a declaration of (Ngo-Te vs. Yu-Te, G.R. No. 161793,
nullity of marriage due to February 13, 2009)
psychological incapacity. So
long as the totality of NO STRICT APPLICATION OF ART. 36
evidence, as in this case,
sufficiently proves the Article 36 of the Family Code must not be so
psychological incapacity of strictly and too literally read and applied
one or both of the spouses, a given the clear intendment of the drafters to
decree of nullitt of marriage adopt its enacted version of "less specificity"
may be issued. obviously to enable "some resiliency in its
application." Instead, every court should
• On using grounds for legal separation approach the issue of nullity "not on the
as manifestation of psychological basis of a priori assumptions, predilections
incapacity or generalizations, but according to its own
facts" in recognition of the verity that no
• So long as a party can case would be on "all fours" with the next
demonstrate that the [drug one in the field of psychological incapacity as
abuse] is a manifestatio of a ground for the nullity of marriage x x x.
psychological incapacity at (Kalaw vs. Fernandez, G.R. No. 166357,
the time of the marriage, this January 14, 2015)
should be enough to render
the marriage void under DECLARATION OF PRESUMPTIVE DEATH
article 36 of the family code.
• Requisites of a valid second marriage
• On the applicable property regime
• The absent spouse has been
• Article 147, fc. – when a man missing for 4 consecutive
and a woman who are years or 2 consecutive years
capacitated to marry each (where there is danger of
other, live exclusively with death)
each other as husband and • The present spouse wishes to
wife without the benefit of remarry
marriage or under a void • The present spouse has a
marriage, their wages and well-founded belief that the
salaries shall be owned by absent spouse is dead
charges.
Page 18 of 117
• The present spouse initiates a property, by judicial decree, on any
summary proceeding for the of the grounds recognized by law.
declaration of presumptive
death and a decision is • Distinguished from Separation de
rendered therein Facto or Separation in Fact:
VOIDABLE MARRIAGES • Legal separation is decreed

by the court; separation de
• The party in whose behalf it is sought facto is actual separation
to have the marriage annulled was 18 without any court decree.
years of age or over but below 21,
and the marriage was solemnized • Legal separation dissolves the
without parental consent property relations of the
• Either party is of unsound mind party and removes the guilty
• Fraud in obtaining consent of either party’s capacity to inherit
party from the innocent spouse;
• Vitiated consent – obtained through separation de facto has no
force, intimidation or undue effect on the property
influence relations and capacity to
• Physical incapability of either party succeed
to consummate the marriage
• Either party was afflicted with std • Distinguished from Annulment of
FOUND TO BE SERIOUS OR Marriage:
INCURABLE
• In legal separation, the
• Defenses marriage is not defective as
the grounds arise only after
• Prescription (5 years) the marriage; in annulment,
• Ratification the marriage is defective
from inception, as the
• Circumstances that constitute fraud grounds existed prior to or at
the time of marriage.
• Non-disclosure of a previous
conviction by final judgment • In legal separation, the
of a crime involving moral parties may not remarry; in
turpitude annulment, the parties can
• Concealment by the wife that remarry.
she was pregnant at the time
of marriage by another man GROUNDS FOR LEGAL SEPARATION
• Concealment of a std at the
time of the marriage • Repeated physical violence or grossly
• Concealment of drug abusive conduct directed against the
addiction, habitual petitioner, a common child or a child
alcoholism, homosexuality or of the petitioner.
lesbianism at the time of
marriage • Physical violence or moral pressure
to compel the petitioner to change
WHAT IS LEGAL SEPARATION? religious or political affiliation.
• It is the suspension of the common • Attempt of respondent to corrupt or

marital life, both as to person and induce the petitioner, a common
charges.
Page 19 of 117
child, or a child of the petitioner, to
engage in prostitution or connivance • It is the agreement to the
in such corruption or inducement. ground for legal separation.
• Final judgment sentencing the • Recrimination. Where both parties

respondent to imprisonment of more have given ground for legal
than six years, even if pardoned. separation.
• Drug addiction or habitual alcoholism • This is mutual guilt.

of the respondent. • The ground committed by
• Lesbianism or homosexuality of the one may be different from
respondent. the ground committed by the
other.
• Contracting by the respondent of a • This is based on the principle
subsequent bigamous marriage, that a person must come to
whether in the Philippines or abroad. court with clean hands.
• Sexual infidelity or perversion. • Collusion. Where there is collusion

• Attempt by the respondent against between the parties to obtain decree
the life of the petitioner. of legal separation.
• Abandonment by respondent • By committing a ground for

without justifiable cause for more legal separation
than one year. • By making it appear that a
ground has been committed
DEFENSES IN LEGAL SEPARATION • By suppressing evidence of a
valid defense.
• Condonation. Where the aggrieved
party has condoned the offense or • Prescription. Where the action is
act complained of. barred by prescription, i.e., filed
more than 5 years from occurrence
• Condonation of one act does of the cause.
not necessarily mean
condonation of others. PROCEDURAL MATTERS
• Consent. Where the aggrieved party • Prescriptive period – 5 years

has consented to the commission of • Cooling off period – 6 months after
the offense or act complained of. the filing of the petition
• Efforts toward reconciliation – to be
• Consent is conformity in taken by the court and may even
advance by a spouse to the continue after the 6 month cooling
offense of the other spouse. off period
• Consent is made before the • No confession of judgment allowed
offense; condonation is made • Provisional remedies allowed:
after the offense. • Physical separation
• Administration of property
• Connivance. Where there is • Support pendente lite
connivance between the parties in
the commission of the offense of act EFFECTS OF LEGAL SEPARATION
constituting the ground for legal
separation.
charges.
Page 20 of 117
• Can live separately but the marriage • Conjugal partnership of gains
bond remains • Complete separation of
• Property regime shall be dissolved property
and liquidated • Mixed property regime as
• The guilty spouse shall not may be agreed upon in the
have a right to the net profits marriage settlement
of the properties
• Custody of minor children shall be • Requisites of a valid marriage
given to the innocent spouse settlement
• Guilty spouse shall be disqualified to
inherit ab intestato and provisions in • It must be entered into
the will made before the legal before the celebration of
separation shall be revoked marriage
• Mutual support shall cease, but the • It must be in writing
court may award the innocent • It must be signed by the
spouse alimony parties
• Donations and designations as • To affect third persons, it
beneficiary in life insurance in favor should be registered in the
of the guilty spouse shall be nullified civil registry and registry of
property
RECONCILIATION • It must fix terms and
conditions of their property
• A joint manifestation is mas filed relations
under oath with the court which
rendered the decree of legal • Note!
separation • The provisions of the
• If still pending, the legal separation marriage settlement are void
proceedings shall be terminated. If if the marriage does not take
already final and executory, the place
decree shall be set aside.
• The spouses can now live together ABSOLUTE COMMUNITY OF PROPERTY
again.
• But separation of property and • Properties included
revocation of testamentary
provisions, donations and insurance • All properties owned by the
shall remain, except the spouses may spouses at the time of the
revive their property regime. marriage or acquired
thereafter
NOTES ON PROTERTY REGIMES • Fruits included
PROPERTY RELATIONS • Exclusions
• Governed by • Property (inclusive of fruits

and income thereof) acquired
• The marriage settlement during the marriage by
• Provisions of the family code gratuitous title, except when
• Local customs the donor, testator or grantor
expressly provides otherwise
• Kinds of property regime • Property acquired before the
marriage by either spouse
• Absolute community who has legitimate
charges.
Page 21 of 117
descendants by a former • Property acquired during the
marriage marriage by gratuitous title
• Property for personal and • Property acquired by right of
exclusive use except jewelry redemption, barter or
exchange with property
CONJUGAL PARTNERSHIP OF GAINS belonging to either spouse
• Property purchased with
• Properties included exclusive money of either
spouse
• Those acquired by onerous
title during the marriage at CHARGES AGAINST THE PROPERTY
the expense of the common ACP/CPG
fund whether the acquisition
be for the partnership or for • The support of the spouses, their
only one of the spouses common children, and legitimate
• Those obtained from the children of either spouse; however,
labor, industry, work or the support of illegitimate children
profession of either or both of shall be governed by the provisions
the spouses of this Code on Support;
• The fruits, natural, industrial, • All debts and obligations contracted
or civil, due or received during the marriage by the
during the marriage from the designated administrator-spouse for
common property, as well as the benefit of the community, or by
the net fruits from the both spouses, or by one spouse with
exclusive property of each the consent of the other;
spouse • Debts and obligations contracted by
• The share of either spouse in either spouse without the consent of
the hidden treasure which the other to the extent that the
the law awards to the finder family may have been benefited;
or owner of the property • All taxes, liens, charges and
where the treasure is found expenses, including major or minor
• Those acquired through repairs, upon the community
occupation such as fishing or property;
hunting • All taxes and expenses for mere
• Livestock existing upon the preservation made during marriage
dissolution of the partnership upon the separate property of either
in excess of the number of spouse used by the family;
each kind brought to the • Expenses to enable either spouse to
marriage by either spouse commence or complete a
• Those which are acquired by professional or vocational course, or
chance, such as winnings other activity for self-improvement;
from gambling or betting. • Ante-nuptial debts of either spouse
However, losses therefrom insofar as they have redounded to
shall be borne exclusively by the benefit of the family;
the loser spouse • The value of what is donated or
promised by both spouses in favor of
• Properties not included their common legitimate children for
the exclusive purpose of
• Property that is brought to commencing or completing a
the marriage as his or her professional or vocational course or
own other activity for self-improvement;
charges.
Page 22 of 117
• Ante-nuptial debts of either spouse • When separation is provided for in
other than those falling under the marriage settlement
paragraph (7) of this Article, the
support of illegitimate children of • Upon judicial declaration of
either spouse, and liabilities incurred separation
by either spouse by reason of a crime
or a quasi-delict, in case of absence • Grounds:
or insufficiency of the exclusive • The spouse of the
property of the debtor-spouse, the petitioner has been
payment of which shall be sentenced to a
considered as advances to be penalty which carries
deducted from the share of the with it civil
debtor-spouse upon liquidation of interdiction
the community; and • The spouse of the
• Expenses of litigation between the petitioner has been
spouses unless the suit is found to be judicially declared as
groundless an absentee
• The loss of parental
ADMINISTRATION AND DISPOSITION OF authority of the
THE ACP/CPG spouse of petitioner
has been decreed by
 Joint the court
 In case of disagreement, husband’s • The spouse of the
de petitioner has
 cision shall prevail abandoned the latter
 In case one spouse is incapacitated or or failed to comply
unable to participate in the with his or her
administration of the common obligations to the
properties, other spouse may family
assume sole powers • The spouse granted
 Any disposition or encumbrance the power of
without the consent of the other administration in the
spouse is void marriage settlement
 It can, however, be subsequently has abused that
accepted by the other spouse before power
the offer is withdrawn • At the time of the
 In case of cpg, it is valid if the loan petition, the spouses
redounded to the benefit of the have been separated
family in fact for at least one
year and
DISSOLUTION OF THE ACP/CPG reconciliation is highly
improbable
• Death of either spouse
• Legal separation PROPERTY RELATIONS OF COMMON-LAW
• Annulment or declaration of nullity SPOUSES
of marriage
• Judicial separation of property • Co-ownership
REGIME OF SEPARATION OF PROPERTY • Common-law spouses

without impediment
charges.
Page 23 of 117
• Marriage is void but the
spouses are without • By nature:
impediment (e.g. Art. 36, FC, • Legitimate
marriages without formal • Illegitimate
requisites) • By adoption
• Actual joint contribution PROOF OF FILIATION
• Common-law spouses with Art. 172, Family Code:

impediment
Primary
JURISPRUDENCE • The record of birth appearing in the
civil register or a final judgment;
Any property regime in place at the time of • An admission of legitimate filiation in
the marriage may be modified in the a public document or a private
following situations: handwritten instrument and signed
by the parent concerned.
(a) the absolute community or conjugal Secondary
partnership was dissolved and • Open and continuous possession of
liquidated upon a decree of legal the status of a legitimate child;
separation; • Any other means allowed by the
(b) the spouses who were legally Rules or special laws.
separated reconciled and agreed to
revive their former property regime; > Result of DNA is an acceptable evidence to
(c) judicial separation of property had prove the paternity of a child (Ong vs. Diaz,
been had on the ground that a G.R. No. 171713, December 17, 2007)
spouse abandons the other without
just cause or fails to comply with his LEGITIMATE CHILDREN
obligations to the family;
(d) there was judicial separation of • They are children conceived or born
property under Article 135; during the marriage of the parents.
(e) the spouses jointly filed a petition for Thus:
the voluntary dissolution of their • A child conceived before
absolute community or conjugal marriage (pre-marital) but
partnership of gains born after his parents got
Pana vs. Heirs of Jose Juanite, Sr., married, is legitimate.
G.R. No. 164201, December 10, 2012 • A child conceived during the
marriage, but born after the
NOTES ON PATERNITY AND FILIATION marriage has already been
terminated (due to death or
What is Paternity and Filiation? annulment), is legitimate
• Paternity is the status or relation of • Children conceived as a result of

the parent with respect to his or her artificial insemination are legitimate,
child. provided:
• The conditions for legitimate
• Filiation is the status or relation of a children apply;
child with respect to his or her • Both husband and wife
parents. authorized the insemination
in a written instrument;
• Kinds of Filiation:
charges.
Page 24 of 117
• The written instrument is • When the mother contracted
recorded together with the another marriage AFTER 300 days
birth certificate of the child. following the termination of the
former marriage
PRESUMPTION OF LEGITIMACY • If the child is born during the
second marriage, he is a
• The child shall be considered legitimate child of the said
legitimate although the mother may marriage.
have declared against its legitimacy • If the child is born before the
or may have been sentenced as an second marriage, his
adulteress (Art. 167, FC) legitimacy or illegitimacy shall
• The law requires that every be proved.
presumption be made in favor of
legitimacy. The presumption of • When the mother contracted
legitimacy does not only flow out of a another marriage WITHIN 300 days
declaration in the statute but is after the termination of the first
based on the broad principles of marriage:
natural justice and the supposed • The child is conceived of the
virtue of the mother. It is grounded first marriage if he is born
on the policy to protect the innocent within 180 days from the
offspring from the odium of solemnization of the second
illegitimacy. (Concepcion vs. Court of marriage and within 300 days
Appeals, G.R. No. 123450, August 31, after the termination of the
2005) first marriage.
• The presumption of legitimacy in the • The child is considered
Family Code x x x actually fixes a civil conceived of the subsequent
status for the child born in wedlock, marriage if he is born after
and that civil status cannot be 180 days following the
attacked collaterally. The legitimacy solemnization of the second
of the child can be impugned only in marriage even if born within
a direct action brought for that the 300 days after the
purpose, by the proper parties, and termination of the former
within the period limited by law. marriage.
(Geronimo vs. Santos, G.R. No.
197099, September 28, 2015) The following are also considered
legitimate
Rules when the mother gives birth after the
marriage • Children conceived or born before
the finality of the judgment of
• When the mother has not remarried: annulment
• If the child is born WITHIN
300 days from the • Children conceived or born before
termination of the marriage, finality of the judgment of absolute
he is presumed to be nullity of the marriage under Art. 36
legitimate. (psychological incapacity)
• If the child is born AFTER 300
days following the • Children conceived or born of the
termination of the marriage, subsequent marriage under Art. 53
his legitimacy or illegitimacy (void for failure to comply with
shall be proved. requirements of delivery of
presumptive legitimes)
charges.
Page 25 of 117
instrument made by the
• Children of a subsequent marriage father.
where the first spouse was declared • To be under the parental
presumptively dead but reappeared. authority of the mother.
• To receive support in
• Children conceived or born before conformity with the Family
the finality of the judgment of Code.
annulment • To be entitled to legitime
consisting of one-half of the
• Children conceived or born before legitime of a legitimate child.
finality of the judgment of absolute
nullity of the marriage under Art. 36 REPUBLIC ACT 9255
(psychological incapacity)
• It amended Art. 176 of the Family
• Children conceived or born of the Code, as follows:
subsequent marriage under Art. 53 Article 176. Illegitimate children shall
(void for failure to comply with use the surname and shall be under the
requirements of delivery of parental authority of their mother and shall
presumptive legitimes) be entitled to support in conformity with this
Code. However, illegitimate children may
• Children of a subsequent marriage use the surname of their father if their
where the first spouse was declared filiation has been expressly recognized by
presumptively dead but reappeared. the father through the record of birth
appearing in the civil register, or when an
RIGHTS OF LEGITIMATE CHILDREN admission in a public document or private
handwritten instrument is made by the
• To bear the surnames of the father father. Provided, the father has the right to
and the mother; institute an action before the regular courts
• To receive support from their to prove non-filiation during his lifetime. The
parents, their ascendants, and, in legitime of each illegitimate child shall
proper cases, their brothers and consist of one-half of the legitime of a
sisters; legitimate child.
• To be entitled to legitime and other
successional rights. LEGITIMATED CHILDREN
ILLEGITIMATE CHILDREN • Legitimation - takes place by

subsequent marriage
• Those conceived and born outside a • Requisites:
valid marriage • The child is
illegitimate
• Rights: • The parents at the
• To use the surname of the time of the child’s
mother (Art. 176, FC). conception are not
However, they can use the disqualified from
surname of the father if their marrying each other
filiation is recognized by the • There is a valid
father through the record of marriage subsequent
birth or when admission is to the child’s birth
made in a public document or
private handwritten
REPUBLIC ACT 9858
charges.
Page 26 of 117
• If the husband should
• Art. 177 of the Family Code was die after the filing of
amended as follows: the complaint,
without having
Art. 177. Children conceived and desisted therefrom;
born outside of wedlock of parents who, at or
the time of conception of the former, were • If the child was born
not disqualified by any impediment to marry after the death of the
each other, or were so disqualified only husband.
because either or both of them were below
eighteen (18) years of age, may be • Prescription of action to impugn
legitimated. • One year from the knowledge
of the birth or recording, if
• Thus, if the parents of the child were the husband or heir lives in
underage, hence not qualified to the same city or municipality
marry, when the child was born, said where the birth took place or
child may be legitimated is recorded
subsequently when his parents attain • Two years if the husband or
the proper age to marry and, in fact, heir resides in another place
marry. in the Philippines
• Three years if the husband or
CLAIMING/IMPUGNING FILIATION heir resides abroad
• If claiming legitimacy • Note: Upon the expiration of the

• The child, in which case the periods set forth in Article 170 of the
action may be brought during Family Code, the action to impugn
his or her lifetime. the legitimacy of a child would no
• The heirs, if the child dies longer be legally feasible and the
during minority or insanity, in status conferred by the presumption
which case the action shall be becomes fixed and unassailable.
filed within 5 years from the (Aguilar vs. Siasat, G.R. No. 200169,
death of the child January 28, 2015)
• If claiming illegitimacy Grounds to impugn filiation

• The child or his heirs under
the above conditions • Physical impossibility
• If the action is based on the • the physical incapacity of the
secondary proofs, it must be husband to have sexual
brought during the lifetime of intercourse with his wife;
the alleged parent. • the fact that the husband and
wife are living separately in
• Who can impugn such a way that sexual
intercourse is not possible; or
• The husband • serious illness of the husband,
• His heirs, in the following which absolutely prevents
cases: sexual intercourse
• If the husband should • Biological or scientific proof that the
die before the child could not have been that of the
expiration of the husband
period fixed for him to
bring his action;
charges.
Page 27 of 117
• The artificial insemination was • Of legal age
without the consent of either parent • In possession of full civil
or the consent is vitiated. capacity and legal rights
• Of good moral character
NOTES ON ADOPTION • Has not been convicted of any
crime involving moral
What is Adoption? turpitude
• Emotionally and
• It is the process of making a child, psychologically capable of
whether related or not to the caring for children
adopter, possess in general, the • At least 16 years older than
rights accorded to a legitimate child. the adopted
• It is a juridical act, a proceeding in • The 16 year age
rem which creates a relationship that difference may be
is similar to that which results from waived when the
legitimate paternity and filiation. adopter is the
• It is an act by which relations of biological parent of
paternity and affiliation are the adoptee or the
recognized as legally existing spouse of the
between persons not so related by adoptee’s parent
nature. • In a position to support and
• The taking into one's family of the care for his/her children in
child of another as son or daughter keeping with the means of
and heir and conferring on it a title to the family.
the rights and privileges of such.
(Suzuki vs. OSG, G.R. No. 212302, September • Any resident alien possessing the
2, 2020) same qualification as those of
Filipinos, provided the following
DOMESTIC ADOPTION conditions are met:
• His/her country has
• Adoption is a juridical act which diplomatic relations with the
creates between two persons a Philippines;
relationship similar to that which • He/she has been living in the
results from legitimate paternity and Philippines for at least 3
filiation. continuous years prior to the
• A person may adopt (a) a total filing of the application for
stranger, or (b) a relative, such as a adoption and maintains such
sibling or his or her own illegitimate residence until the adoption
child, to give the latter legitimate decree is entered.
status. • He/she has been certified by
• The best interest of the child is the his/her consular official as
primary consideration in the having the legal capacity to
determination of an application for adopt in his/her country and
adoption. that his/her government
• Governing law: RA 8552, the allows the adoptee to enter
“Domestic Adoption Act of 1998” his/her country as his/her
adopted son/daughter.
WHO MAY ADOPT? • The requirements of
residency and
• Any Filipino citizen with the following certification of
qualifications: qualification may be
charges.
Page 28 of 117
waived for the child, provided that the other
following: spouse signified his/her
• A former consent;
Filipino citizen • If the spouses are legally
who seeks to separated from each other.
adopt a
relative within • In case husband and wife jointly
the 4th degree adopt, or one spouse adopts the
of illegitimate child of the other, joint
consanguinity parental authority shall be exercised
or affinity; by the spouses.
• One who seeks
to adopt the WHO MAY BE ADOPTED?
legitimate
child of his/her • Any person below 18 years of age
Filipino who has been administratively or
spouse; judicially declared available for
• One who is adoption;
married to a • The legitimate son/daughter of one
Filipino citizen spouse, by the other spouse;
and seeks to • An illegitimate son/daughter by a
adopt jointly qualified adopter to improve his/her
with his/her status to that of legitimacy;
spouse a • A person of legal age if, prior to the
relative within adoption, said person has been
the 4th degree consistently considered and treated
of by the adopter as his/her own child
consanguinity since minority;
or affinity of • A child whose adoption has been
the Filipino previously rescinded; or
spouse. • A child whose biological or adoptive
parent(s) has/have died, provided,
• The guardian with respect to the no proceedings shall be initiated
ward after the termination of the within 6 months from the death of
guardianship and clearance of the said parent(s).
his/her financial accountabilities.
WHOSE WRITTEN CONSENT IS NECESSARY?
• A non-resident alien or a Filipino
permanently residing abroad may • The adoptee if 10 years of age or
also adopt under the Inter-country over;
Adoption Act. • The biological parents of the child, if
known, or the legal guardian, or the
JOINT ADOPTION BY SPOUSES proper government instrumentality
which has legal custody of the child.
• Husband and wife shall jointly adopt, • The consent of the biological
except in the following cases: parent is not necessary if he
• If one spouse seeks to adopt or she lacks legal capacity to
the legitimate child of the give consent or has
other; abandoned the child.
• If one spouse seeks to adopt
hie/her own illegitimate
charges.
Page 29 of 117
• The legitimate and adopted children, parent is the spouse of the
10 years of age or over, of the adopter
adopter and adoptee, if any.
• The illegitimate children, 10 years of • Legitimacy
age or over, of the adopter if living • The adoptee shall be
with said adopter and the latter’s considered the legitimate
spouse if any; and child of the adopter for all
• The spouse, if any, of the person intents and purposes and, as
adopting or to be adopted. such, is entitled to all the
rights and obligations
PROCEDURE provided by law to legitimate
children born to them
• All hearings and records in adoption without discrimination of any
cases shall be confidential. kind.
• The court shall ensure that the • Succession
biological parents of the child have • In legal and intestate
been properly counseled to prevent succession, the adopter and
hurried decisions. the adoptee shall have
• A case study of the adoptee, the reciprocal rights of succession
biological parents, and the adopters, without distinction from
conducted by a social worker, is legitimate filiation.
required before the case is set for • If the adoptee and his
hearing. biological parents had left a
• Before granting the petition, the will, the law on testamentary
court shall give the adopter a succession shall govern.
supervised trial custody period of at • Note that Art. 189-
least 6 months (subject to reduction 190 of the Family
in proper cases) for the parties to Code which retain
adjust and bond with each other. successional rights
• After compliance with the between the adopted
requirements and publication of the and his biological
order of hearing, and the court is parents are deemed
convinced that the petitioners are repealed by Sec. 16,
qualified and the adoption would RA 8552 which
redound to the best interest of the severed the legal ties
adoptee, a decree of adoption shall between the
be entered effective as of the date of biological parents and
filing of the petition. the adoptee.
• The original birth certificate shall be
cancelled and an amended birth RESCISSION OF ADOPTION
certificate issued by the Civil Registry
• Only the adoptee can rescind the
EFFECTS OF ADOPTION adoption
• Parental Authority • Grounds

• All legal ties between the • Repeated physical and
biological parents and the verbal maltreatment
adoptee shall be severed and by the adopters
then vested on the adopter, despite having
except where the biological undergone counseling
charges.
Page 30 of 117
• Attempt on the life of the biological parent of the child to
the adoptee be adopted or the spouse of such
• Sexual assault or parent;
violence • If married, his/her spouse must
• Abandonment or jointly file the application for
failure to comply with adoption;
parental obligations • Must have the capacity to act and
assume all rights and responsibilities
EFFECTS OF RESCISSION of parental authority under his
national law;
• The reciprocal rights and obligations • Must have undergone the
of the adopter and the adoptee to appropriate counseling from an
each other shall be extinguished. accredited counselor in his/her
• If the adoptee is still a minor or country
incapacitated, the parental authority • Must not have been convicted of a
of the biological parents or legal crime involving moral turpitude;
custody of the DSWD shall be • Eligible to adopt under his/her
restored. national law;
• The court shall order the civil • In a position to provide the proper
registrar to cancel the amended birth care and support and to give moral
certificate and restore the original. guidance to his children, the
• Successional rights shall revert to its prospective adoptee included;
status prior to adoption. • Must agree to uphold the basic rights
of the child;
INTER-COUNTRY ADOPTION • A national of a country with whom
the Philippines maintains diplomatic
• Governed by Republic Act No. 8043 relations and whose laws allow inter-
• The law allows inter-country country adoption;
adoption of Filipino children by alien • Must possess all the qualifications
Prospective Adoptive Parents (PAP) if and none of the disqualifications.
it is for the best interest of the child.
• The Inter-Country Adoption Board CLAA REQUIREMENT
(ICAB) is the central authority in
matters relating to inter-country • R.A. No. 9523 otherwise known as
adoption of Filipino children. "An Act Requiring the Certification of
• The adoption process is commenced the Department of Social Welfare
by filing an application with a Foreign and Development to Declare a Child
Adoption Agency, receiving it for the Legally Available for Adoption"
ICAB or with the RTC (under the mandates that:
Domestic Adoption Act), in which
case, the court will refer it to the • Only a child legally available
ICAB. for adoption may be the
subject of inter-country
QUALIFICATIONS OF A PAP adoption.
• A child legally available for
• May be an alien or a Filipino citizen adoption refers to a child in
permanently residing abroad; whose favor a certification
• Must be at least 27 years old and was issued by the DSWD that
should be at least 16 years older than he/she is legally available for
the child to be adopted at the time of adoption after the fact of
the application, unless the adopter is abandonment or neglect has
charges.
Page 31 of 117
been proven through the • On November 9, 2004, petitioner,
submission of pertinent then 16 years old, was adopted by
documents. Hayashi based on Japanese law. This
was reflected in Hayashi's Koseki or
TRIAL CUSTODY Family Register. The Koseki and its
English translation were both
• Trial custody of the child commences authenticated at the Philippine
upon the physical transfer of the Consulate General on May 15, 2007.
child to the applicant • At 24 years old, petitioner sought to
• The applicant, as custodian, shall be recognized in the Philippines his
exercise substitute parental adoption by Hayashi under Japanese
authority over the child. law. Thus, on May 24, 2013, he filed
• Trial custody is supervised by the a Petition for Judicial Recognition of
Central Authority and/or FAA Foreign Adoption Decree before the
concerned. Regular reports on the RTC of Marikina City.
child's health, psycho-social • The RTC of Marikina City denied the
adjustment, and relationship with petition claiming that it cannot be
the applicants shall be furnished by recognized in the Philippines and
the FAA to the ICAB. petitioner’s adoption should be
• If the child suffers abuse or injury regulated by the State.
from the PAP or other household • Petitioner directly appealed to the
members of the adoptive family, the Supreme Court.
Central Authority or the FAA is • The SC ruled that the RTC
mandated to step in and protect the erroneously ruled that a foreign
child. It may do so by withdrawing judgment of adoption of a Filipino
the child from and terminating the citizen cannot be judicially
trial custody. recognized based on the view that
such recognition would render
RECOGNITION OF FOREIGN ADOPTION nugatory the Philippine laws on
adoption.
The Case of Suzuki vs. OSG, G.R. No. 212302, • Philippine courts will only determine:
September 2, 2020 (1) whether the foreign judgment is
• Petitioner Karl William Yuta Magno contrary to an overriding public
Suzuki aka Yuta Hayashi was born on policy in the Philippines; and (2)
April 4, 1988 in Manila to Mr. Sadao whether any alleging party is able to
Kumai Suzuki, a Japanese national, prove an extrinsic ground to repel
and Ms. Lorlie. Lopez Magno, a the foreign judgment, i.e., want of
Filipino citizen. Petitioner's parents jurisdiction, want of notice to the
were married on December 29, party, collusion, fraud, or clear
1987. Based on Identification mistake of law or fact. Absent any
Certificate No. 08-19540, issued by inconsistency with public policy or
the Bureau of Immigration on March adequate proof to repel the
31, 2008, petitioner is a Filipino judgment, Philippine courts should,
citizen. by default, recognize the foreign
• On June 12, 1997, petitioner's judgment as part of the comity of
parents divorced. On December 6, nations.
2002, Lorlie married another • For Philippine courts to judicially
Japanese national, Mr. Hikaru recognize a foreign judgment relating
Hayashi, in San Juan City, Metro to the status of an adoption where
Manila. one of the parties is a citizen of a
foreign country, the petitioner only
charges.
Page 32 of 117
needs to prove the foreign judgment • Forced or compulsory – takes
as a fact under the Rules of Court. place with respect to the
• Case was remanded to the lower legitime
court for reception of evidence of the • Voluntary – takes place with
foreign judgment of adoption. respect to the free portion
NOTES ON SUCCESSIONS ELEMENTS OF SUCCESSION
What is Succession? • Death (either actual or presumed) of

the decedent
• It is a mode of acquisition by virtue of • Transmissible inheritance
which the property, rights and • Successor or successors (living and
obligations to the extent of the value capacitated to inherit)
of the inheritance, of a person are • Acceptance or non-repudiation by
transmitted through his death to the successor of the inheritance.
another or others either by his will or
by operation of law. (Art. 774, CC) Notes on Death of the Decedent
• It is the substitution of a decedent or
deceased person by a living person in • It is the moment when the rights to
all the property, rights and succeed are transmitted (Art. 777,
obligations which in life belonged to CC)
the former • The possession of hereditary
property is deemed
KINDS OF SUCCESSION transmitted to the heir
without interruption and from
• As to its origin: the moment of the death of
• Testamentary or testacy (by the decedent, in case the
will) inheritance is accepted. (Art.
• Legal or intestacy (by 533, CC)
operation of law based on the
decedent’s presumed will) • A person may be presumed dead for
• Mixed (partly testamentary the purpose of opening his
and legal) succession. Under Art. 390, CC, a
person who is absent for at least 10
• As to its effectivity: years shall be presumed dead, for
• Inter vivos (takes effect purposes of opening his succession. If
during the lifetime of the he disappeared after the age of 75
decedent years, an absence of 5 years shall be
• Mortis causa (takes effect sufficient. However, if the
after the death of the disappearance happened under
decedent exceptional circumstances (on board
a vessel, plane, in times of war, etc.),
• As to its extent: an absence of 4 years shall be
• Universal – covers all sufficient.
property, rights and
obligations of the decedent Notes on Inheritance
• Particular – limited to certain
specific items • It refers to property, rights and
obligations of the decedent not
• As to part of property transmitted: extinguished by death.
charges.
Page 33 of 117
• Patrimonial rights or relating • Characteristics of Wills:
to property are generally part • Unilateral- when it does not
of inheritance as they are not depend on the acceptance of
extinguished by death. the other party
• Rights or obligations (such as • Strictly personal—the
those between creditor and following are solely
debtor) are by nature dependent upon the will of
transmissible. the testator
• Duration or efficacy of
• Also includes all which have accrued the designation of
since the opening of succession. heirs, devisees or
legatees;
Notes on Successors • Determination of the
portions which they
• The successors are the heirs or those are to take, when
who are called to the whole or to an referred to by name;
aliquot portion of the inheritance and
either by will or by operation of law. • Determination of
whether or not the
• Kinds of heirs: testamentary
• Voluntary – those instituted in disposition is to be
the will to succeed to the operative.
inheritance or portion thereof
which the testator can freely • However, the following may
dispose be entrusted to a third
• Compulsory or forced – those person:
who succeed by force of law • Distribution of specific
to some portion of the property or sums of
inheritance, in an amount money that he may
predetermined by law, known leave in general to
as the legitime. specified classes or
causes; and
TESTAMENTARY SUCCESSION; WILLS • Designation of the
persons, institutions
• Will – an act whereby a person is or establishments to
permitted, with the formalities which such property
prescribed by law, to control to a or sums are to be
certain degree the disposition of his given or applied.
estate to take effect after his death
(Art. 783, CC) • Other characteristics:
• Free and voluntary act
• Kinds of Wills: • Formal and solemn act
• Notarial or ordinary – that • Act mortis causa
which requires compliance • Revocable during testator’s
with formalities prescribed by lifetime
law • Individual act
• Holographic – that which is
entirely written, dated and Interpretation of Wills
signed by the hand of the
testator himself • The testator’s wishes and intention
as expressed in his testamentary
charges.
Page 34 of 117
dispositions constitute the first and law at the time of the death of the
principal law in the matter of decedent (Art. 774, 2263, CC)
testaments. • Revocation – Lex loci celebrationis or
• In case of doubt and the lex domicilli (Art. 829, CC)
testamentary disposition is capable
of two or more interpretations, that TESTAMENTARY CAPACITY
which will prevent intestacy will be
preferred. • Refers to the the ability as well as the
• Where the language of the power to make a will.
testamentary disposition is • Must be present at the time of the
expressed clearly and precisely, the execution of the will.
only function of the court is to carry • Requisites:
out the intention of the testator as • At least 18 years of age
manifested in the will itself. • Of sound mind, i.e., the ability
to know:
KINDS OF AMBIGUITIES IN A WILL • the nature of the
estate to be disposed
• Latent or intrinsic ambiguity – that of;
which does not appear on the face of • the proper objects of
the will and is discovered only by his bounty; and
extrinsic evidence. • the character of the
• Patent or extrinsic ambiguity – that testamentary act.
which appears on the face of the will • The law presumes that every person
itself. is of sound mind (Art. 800, CC),
unless:
How corrected: • One month or less before
• In case of latent ambiguity, the making his will, the testator
mistakes and omissions may be was publicly known to be
corrected by consideration of the insane
words of the will itself and extrinsic • Supervening incapacity does not
or parol evidence (except oral invalidate an effective will, nor is the
declarations of the testator) will of an incapable validated by the
• In case of patent ambiguity, the supervening of capacity (Art. 801, CC)
intention of the testator is to be
ascertained from the words of the EFFECT OF CERTAIN INFIRMITIES
will, taking into consideration the
circumstances, except oral • Mere senility or infirmity of old age
declarations of the testator. does not necessarily imply that a
person lacks testamentary capacity.
LAW GOVERNING VALIDITY OF WILLS • Physical infirmity or disease is not
inconsistent with testamentary
• Extrinsic validity – law of the place of capacity.
execution (Art. 17, CC) and the law in • Persons suffering from idiocy (those
force at the time it is made (Art. 795, congenitally deficient in intellect),
CC) imbecility (those who are mentally
• Note: A joint will is void in the deficient as a result of disease), and
Philippines even if valid in the senile dementia (peculiar decay of
country where it was the mental faculties whereby the
executed (Art. 819, CC) person afflicted is reduced to second
• Intrinsic validity – national law of the childhood) do not possess the
decedent (Art. 16, 1039 CC) and the
charges.
Page 35 of 117
necessary mental capacity to make a • It must be signed by the
will. testator or the person
• Intoxication or use of drugs do not requested by him to write his
affect testamentary capacity, unless name and the instrumental
the testator has used intoxicating witnesses of the will, on each
liquor or drugs excessively to such an and every page thereof,
extent as to impair his mind, so that except the last, on the left
at the time the will is executed, he margin (Art. 805).
does not know the extent and value • All the pages must be
of his property, or the names of numbered correlatively in
persons who are the natural objects letters placed on the upper
of his bounty. part of each page (Art. 805);
• Effect: Testamentary incapacity • It must contain an attestation
invalidates the entire will. clause stating the matters
mentioned in Art. 805, CC
FORMALITIES OF WILLS (Art. 805);
• It must be acknowledged
• Common Formalities: before a notary public by the
• Every will must be in writing; testator and the witnesses
and (Art. 806).
• Executed in a language or
dialect known to the testator. Interpretation of the Requirements
• Notes:
• In a notarial will, the testator • All the requirements stand as of
need not perform the equal importance, and courts cannot
mechanical work of writing add other conditions or dispense
the will, so long as the will is with those enumerated in the law.
signed by him or by someone • Courts should adopt a liberal, rather
else in his presence. than a strict, interpretation of the
• The presumption is that the legal formalities in the execution of
testator knew the language in wills.
which the will has been • Thus, according to Art. 809, CC, in the
written which presumption absence of bad faith, forgery, fraud
should stand unless the or undue and improper pressure and
contrary is proven. influence, defects and imperfections
in the form of attestation or in the
SPECIAL FORMALITIES language used therein shall not
render the will invalid if it is proved
• Notarial or Ordinary Wills that the will was in fact executed and
• It must be subscribed at the attested in substantial compliance
end by the testator himself or with the all the requirements of Art.
by the testator’s name 805, CC.
written by some other person
in his presence and by his Witnesses to a Notarial Will
express direction (Art. 805);
• It must be attested and • Qualifications (Art. 820):
subscribed by at least three or • Of sound mind
more credible witnesses in the • 18 years or over
presence of the testator and • Not blind, deaf or dumb
of one another (Art. 805); • Able to read and write
charges.
Page 36 of 117
• Domiciled in the Philippines face that the bequests are made on
(821) one in consideration of the other.
• Has not been convicted of • Joint wills and joint and mutual wills
falsification of document, are prohibited. Reasons:
perjury or false testimony • It destroys the character of a
(821) will as a strictly personal and
unilateral act, usually kept
HOLOGRAPHIC WILLS secret by the testator;
• It tends to convert a will into
• Requisites: a contract;
• It must be written in a • It runs counter to the idea
language or dialect known to that wills are essentially
the testator; irrevocable;
• It must be entirely written by • It may subject one to undue
the testator; influence; and even induce
• It must be dated by him; one of the testators to take
• It must be signed by him; and the life of the other if the will
• It must be made with animus is also reciprocal; and
testandi • It makes probate much more
• During the probate of a holographic difficult in case of the death of
will: the testators are different
• At least one witness who times.
knows the handwriting and
signature of the testator must Codicil and Incorporation by Reference
explicitly declare that the will
and the signature are in the • Codicil – A supplement or addition to
handwriting of the testator. a will, made after the execution of a
• If the will is contested, at least will and annexed to be taken as a part
three witnesses shall be thereof, by which any disposition
required. made in the original will is explained,
• In the absence of any added to, or altered. (Article 825, CC)
competent witness, and if the
court deems it necessary, • To be effective, it must be executed
expert testimony may be as in the case of a will. Its execution
resorted to. has the effect of republishing the will
as modified.
JOINT WILLS
• Incorporation by Reference –
• A joint will is one where the same Contemplates only lists of properties,
testamentary instrument is made the books of accounts, and inventories.
will of two or more persons and is
jointly executed and signed by them. • Provisions which are in the nature of
• Mutual or reciprocal wills are testamentary dispositions must be
separate wills of two persons which contained in the will itself.
are reciprocal in their provisions,
giving the separate property of each • Requisites of a valid Incorporation by
testator to the other. Reference:
• A joint and mutual will is one • The document or paper
executed jointly by two or more referred to in the will must be
persons, the provisions of which are in existence at the time of the
reciprocal, and which shows on its execution of the will;
charges.
Page 37 of 117
• The will must clearly describe • act of unworthiness by an
and identify the same, stating heir, devisee/legatee revokes
among other things the testamentary provisions in his
number of pages thereof; favor;
• It must be identified by clear • if both spouses of the
and satisfactory proof as the subsequent marriage acted in
document or paper referred bad faith, said marriage shall
to therein; be void ab initio and
• It must be signed by the testamentary dispositions
testator and the witnesses on made by one in favor of the
each and every page, except other are revoked by
in case of voluminous books operation of law (Art. 44,
of account or inventories. Family Code); and
• void ab initio or annulled
REVOCATION OF WILLS AND marriages revoke
TESTAMENTARY PROVISIONS testamentary dispositions
made by one spouse in favor
• Revocation – An act of the mind, of the other (Art. 50, Family
terminating the potential capacity of Code)
the will to operate at the death of the
testator, manifested by some • Revocation by subsequent
outward or visible act or sign, instrument:
symbolic thereof. Such right to • Express – when there is a
revoke a will cannot be waived or revocatory clause expressly
restricted. revoking the previous will or a
part thereof
• Ways of Revocation: • Implied – when the provisions
• By implication or operation of thereof are partially or
law; entirely inconsistent with
• By the execution of some will, those of the previous will
codicil or other writing • Note: While express revocation may
• By burning, tearing, be effected by a subsequent will, or a
cancelling or obliterating with codicil, or a non-testamentary
intent to revoke (animus writing executed as provided in case
revocandi) of wills, implied revocation may be
effected only by either a subsequent
• Revocation by implication or will, or a codicil.
operation of law: • The second will must comply with the
• legal separation revokes formalities of the will.
testamentary provisions in
favor of the offending spouse; • Revocation by Overt Acts (burning,
• preterition revokes the tearing, etc.)
institution of heir; • Requisites:
• judicial action for recovery of • testamentary capacity at the
debt revokes a legacy of time of performing the act of
credit/remission of debt; destruction;
• transformation, alienation, or • intent to revoke (animus
loss of bequeathed property revocandi);
revokes a legacy of such • actual physical act of
property; destruction;
charges.
Page 38 of 117
• completion of the subjective clause of the second will, not
phase; and being testamentary in
• performed by the testator character, operates to revoke
himself or by some other the previous will instantly
person in his presence and upon the execution of the will
express direction containing it (revocatory
• Actual presence of the clause)
testator mandatory
ALLOWANCE AND DISALLOWANCE OF
• When Revocation may be Presumed: WILLS
• Where a will which cannot be
found is shown to have been • Probate
in the possession of the • A special proceeding
testator, when last seen, the mandatorily required for the
presumption is, in the purpose of establishing the
absence of other competent validity of a will.
evidence, that the same was • It is the statutory method of
cancelled or destroyed. establishing in court the
• The same presumption arises proper execution of an
where it is shown that the instrument and adjudging it
testator had ready access to as the valid will of a deceased
the will and it cannot be person.
found after his death.
Mamuyac vs. Mamuyac, L-26317, • Kinds of Probate
January 29, 1927 • Ante mortem or that which is
had upon petition by the
REPUBLICATION AND REVIVAL OF WILLS testator himself during his
lifetime; and
• Republication – It is the re- • Post mortem or that which is
establishment by the testator of a had after the testator’s death
previously revoked will or one invalid
for want of proper execution as to • Questions that may be determined
form or for other reasons, so as to by the probate court:
give validity to said will. • Identity of the will;
• Testamentary capacity of the
• Kinds of Republication: testator; and
• By re-execution or • Due execution of the will.
reproducing in a subsequent
will the dispositions • General Rule:
contained in a previous one • In probate proceeding, the
• By execution of a codicil court’s area of inquiry is
referring to a previous will limited to an examination of,
and resolution on the extrinsic
• Revival – It is done by the execution validity of the will, the due
of a third will or a codicil, after the execution thereof, the
first will was revoked by a second will. testatrix’s testamentary
capacity and the compliance
• Principle of instanter with the requisites or
• The express revocation of the solemnities prescribed by law.
first will renders it void The probate court cannot
because the revocatory inquire into the intrinsic
charges.
Page 39 of 117
validity of testamentary of affixing his signature
provisions. thereto.
• Exception – When practical INSTITUTION OF HEIRS

considerations demand that the
intrinsic validity of the will be passed • It is an act by virtue of which a
upon. testator designates in his will the
• In Nuguid vs. Nuguid (17 SCRA person or persons who are to
449 [1962]), the SC held that succeed him in his property and
remanding the case to the transmissible rights and obligations.
lower court for probate will (Art. 840, CC)
only result in waste of time,
effort and expenses plus • The proper test in order to determine
added anxiety, for which the validity of an institution of heir is
reason the appellate court the possibility of finally ascertaining
should meet the issue of the the identity of the instituted heir by
validity of the provisions of intrinsic or extrinsic evidence.
the will even before it is
probated. • Characteristics of an instituted heir:
• In Nepomuceno vs. Court of • He is a testamentary heir as
Appeals (139 SCRA 206 distinguished from a legal or
[1985]), the SC held that intestate heir.
where the will on its face is of • He acquires rights which are
dubious legality, the court limited to the disposable
may pass first upon the portion of the inheritance and
intrinsic validity before its cannot impair the legitime
formal validity is established.
• Presumption of Equality
• Grounds for Disallowance of a Will • Heirs instituted without
• If the formalities required by designation of shares shall
law have not been complied inherit in equal parts. This is
with; limited only to the case where
• If the testator was insane, or all of the heirs are of the same
otherwise mentally incapable class or juridical condition,
or making a will, at the time and where there are
of its execution; compulsory heirs among the
• If it was executed through heirs instituted, it should be
force or under duress, or the applied only to the disposable
influence of fear or threats; free portion
• If it was procured by undue
and improper pressure and • Presumption of Individuality
influence, on the part of the • When the testator institutes
beneficiary or of some other some heirs individually and
person; others collectively, those
• If the signature of the testator collectively designated shall
was procured by fraud; be considered as individually
• If the testator acted by instituted, unless it clearly
mistake or did not intend that appears that the intention of
the instrument he signed the testator was otherwise.
should be his will at the time
• Presumption of Simultaneity
charges.
Page 40 of 117
• When the testator calls to the the institution shall be
succession a person and his effectual, without prejudice
children, they are all deemed to the right of representation.
to have been instituted
simultaneously and not • Note:
successively. • The surviving spouse is not a
compulsory heir in the direct
• Institution to only a portion of the line. Her omission is not
inheritance preterition. The result is only
• If the institution is limited to partial annulment of the
aliquot portions, legal institution of heirs to cover
succession shall take place the legitime of the surviving
with respect to the remainder spouse.
of the estate
• But if it was the intention of When rights of heirs are not transmitted
the testator that the
instituted heirs should • In case of predecease, which occurs
become sole heirs, the aliquot when the heir dies before the
parts shall be increased testator (unless the said heir is in the
proportionally direct descending line and in the
• If the aliquot parts exceed the collateral line in which the right of
inheritance they shall be representation applies)
reduced proportionally. • In case of incapacity, which exists
when the heir becomes
PRETERITION incapacitated to succeed (as
provided under Art. 1024, 1029,
• It is the omission in the testator’s will 1031, 1032, 1035, CC)
of one, some, or all of the • In case of repudiation, where the heir
compulsory heirs in the direct line, renounces his inheritance (Note Art.
whether living at the time of the 976, CC)
execution of the will or born after the • In case of disinheritance, where a
death of the testator (Art. 854, CC) compulsory heir is deprived of his
legitime for causes expressly
• Requisites provided by law (Art. 915, CC)
• The heir omitted must be a
compulsory heir in the direct SUBSTITUTION
line;
• The omission must be • It is the appointment of another heir
complete and total in so that he may enter into the
character; and inheritance in default of the heir
• The compulsory heir omitted originally instituted (Art. 857, CC)
must survive the testator
• Kinds:
• Effects of Preterition • Simple or common – when the
• It annuls the institution of testator designated one or
heir; more persons to substitute
• The devises and legacies are the heir or heirs instituted in
valid insofar as they are not case such heir or heirs should
inofficious; and die before him, or should not
• If the omitted compulsory heir wish, or should be
should die before the testator,
charges.
Page 41 of 117
incapacitated to accept the encumbrance, condition, or
inheritance substitution whatsoever upon
• Brief or compendious – if two the legitime of compulsory
or more persons are heirs.
substituted for one heir or if • Impossible conditions and
one person is substituted for those contrary to law or good
two or more heirs. customs are presumed to
• Reciprocal – if heirs instituted have been imposed
in unequal shares should be erroneously or through
reciprocally substituted, the oversight, thus, are
substitute shall acquire the considered as not imposed.
share of the heir who dies, • An absolute condition not to
renounces or is incapacitated. contract a subsequent
• Fideicommissary – where the marriage is generally void,
fiduciary or first heir instated unless imposed upon a widow
is entrusted with the or widower by the deceased
obligation to preserve and to spouse or by the latter’s
transmit to a second heir the ascendants or descendants.
whole or part of the Even so, however, the
inheritance legitime of the surviving
spouse cannot be impaired.
• Limitations on Fideicommissary • Any disposition made upon
Substitution the condition that the heir
• The substitution must be shall make some provisions in
made expressly. his will in favor of the testator
• It must be imposed on the free or of any other person shall be
portion and not on the void (disposicion captatoria).
legitime. • Conditions imposed by the
• It must not go beyond one testator upon the heirs shall
degree from the heir be governed by the rules
originally instituted; and established for conditional
• Both the first heir and the obligations in all matters not
second heir must be living at provided for by the law on
the time of the death of the succession.
testator.
LEGITIMES
OTHER TESTAMENTARY DISPOSITIONS
Legitime – that part of the decedent’s
• The institution of an heir may be property which he cannot dispose of
made 1) conditionally, 2) for a term, because the law has reserved it for certain
or 3) for a certain purpose or cause heirs who are, therefore, called compulsory
(modal). Conditions, terms, and heirs.
modes however, are not presumed;
they must be clearly expressed in the Kinds of Compulsory Heirs:
will. The condition must fairly appear • Primary – those who exclude the
from the language of the will. secondary heirs and are never
Otherwise, it is not binding. excluded by other compulsory heirs
or by each other (ex. Legitimate
• Limitations children and descendants)
• The testator cannot impose • Secondary – those who are entitled
any charge, burden, to the legitime only in the absence of
charges.
Page 42 of 117
the primary compulsory heirs (ex. charges from the gross value of the
Legitimate parents and ascendants estate;
• Concurring – those who succeed • Collation or addition of the value of
together with the primary and/or all donations inter vivos to the net
secondary compulsory heirs (ex. value of the estate;
Surviving spouse, illegitimate • Determination of the amount of the
children) legitime from the total thus found;
• Notes: • Imputation of the value of all
• Adopted children are deemed donations inter vivos made to
legitimate children compulsory heirs against their
• Illegitimate children are legitime and of the value of all
compulsory heirs and are donations inter vivos made to
entitled to ½ of the legitime strangers against the disposable free
of a legitimate child portion and restoration to the
• Illegitimate children cannot, hereditary estate if the donation is
however, inherit from the inofficious; and
legitimate relatives of his • Distribution of the residue of the
illegitimate parent/s because estate in accordance with the will of
of the iron bar rule under Art. the testator
992, CC
RESERVA TRONCAL
RULES ON LEGITIMES
• The reservation by virtue of which an
• Direct descending line ascendant who inherits from his
• Rule of preference between descendant any property which the
lines latter may have acquired by
• Rule of proximity gratuitous title from another
• Rule of representation ad ascendant or a brother or sister, is
infinitum in case of obliged to reserve such property for
predecease, incapacity or the benefit of relatives who are
disinheritance within the 3rd degree and who belong
• If all the LC repudiate their to the line from which such property
legitime, the next generation came.
of legitimate descendants • It constitutes as an exception to both
succeed in their own right the system of legitime and the order
• Direct ascending line of intestate succession.
• Rule of division by lines • Purpose of Reserva Troncal:
• Rule of equal division • To reserve certain property in
favor of certain persons;
Steps in Determining the Legitime of • To prevent persons outside a
Compulsory Heirs family from acquiring, by
some chance or accident,
• Determination of the gross value of property which otherwise
the estate at the time of the death of would have remained with
the testator; the said family;
• Determination of all debts and • To maintain a separation
charges which are chargeable between paternal and
against the estate; maternal lines.
• Determination of the net value of the • Requisites of Reserva Troncal:
estate by deducting all the debts and • The property should have
been acquired by operation of
charges.
Page 43 of 117
law by an ascendant subject to a resolutory
(reservista) from his condition.
descendant (propositus) • The propositus can prevent
upon the death of the latter. the reserva by disposing by
• The property should have will the property subject of
been previously acquired by the reserva
gratuitous title by the
descendant (propositus) from • Obligations of Reservista
another ascendant or from a • To make an inventory of all
brother or sister (originator). reservable property;
• The descendant (propositus) • To appraise value of all
should have died without any reservable movable property;
legitimate issue in the direct • To annotate in Registry of
descending line who could property the reservable
inherit from him. character of all reservable
Personal Elements: immovable property;
• To secure by mortgage (a)
• Originator – the ascendant, or restitution of movables not
brother or sister from whom the alienated, (b) payment of
propositus had acquired the property damages caused by his fault
by gratuitous title (e.g. donation, or negligence, (c) return of
remission, testate or intestate price received for movables
succession); alienated and (d) payment of
• Propositus – the descendant who value of immovable
died and from whose death the alienated.
reservista in turn had acquired the
property by operation of law (e.g. by • Extinguishment of Reserva Troncal:
way of legitime or intestate • Death of reservatarios;
succession). The so-called “arbiter of • Death of all relatives of
the fate of the reserva troncal.” propositus within the 3rd
• Reservista – the ascendant, not degree who belong to the line
belonging to the line from which the from which the property
property came that is the only came;
compulsory heir and is obliged to • Loss of the reservable
reserve the property property for causes not due to
• Reservatarios – the relatives of the the fault or negligence of the
propositus within the 3rd degree and reservista.
who belong to the line from which • Waiver or renunciation by the
the property came and for whose reservatarios;
benefit the reservation is • Prescription of the right of the
constituted. They must be related by reservatarios, when the
blood not only to the propositus but reservista holds the property
also to the originator adversely against them in the
concept of an absolute
• Notes: owner;
• All personal elements must be • Registration by the reservista
joined by bonds of legitimate of the property as free
relationship property (without the
• All qualified reservatarios reservation) under the Land
acquire an inchoate right. Registration Act
Reservista owns the property
charges.
Page 44 of 117
DISINHERITANCE Common Causes for Disinheritance
• Disinheritance is a testamentary • When the heir has been found guilty

disposition by which a person is of an attempt against the life of the
deprived of, or excluded from, the testator, his/her descendants or
inheritance to which he has a right. ascendants, and spouse in case of
• A disinheritance properly effected children and parents;
totally excludes the disinherited heir • When the heir has accused the
from the inheritance. The testator of a crime for which the law
disinherited heir is deprived not only prescribes imprisonment for 6 years
of the legitime but also of such part or more, if the accusation has been
of the free portion that would have found groundless;
passed to him by a previous will • When the heir by fraud, violence,
(which is revoked, as inconsistent intimidation, or undue influence
with, the subsequent disinheritance) causes the testator to make a will or
or by intestate succession. to change one already made;
• Refusal without justifiable cause to
• Requisites: support the testator who disinherits
1. Effected only through a such heir.
valid will;
2. For a cause expressly
stated by law; Peculiar Causes of Disinheritance
3. Cause must be stated in
the will itself; • Children/Descendants:
4. Cause must be certain • When the child/descendant
and true; has been convicted of
5. Unconditional; adultery or concubinage with
6. Total; and the spouse of the testator;
7. The heir disinherited • Maltreatment of the testator
must be designated in by word or deed by the
such a manner that there child/descendant;
can be no doubt as to his • When the child/descendant
identity. leads a dishonorable or
disgraceful life; Conviction of
Effects of Disinheritance: a crime which carries with it a
penalty of civil interdiction.
• Deprivation of the compulsory heir
who is disinherited of any • Parents/Ascendants
participation in the inheritance • When the parents have
including the legitime. abandoned their children or
• The children/descendants of the induced their daughters to
person disinherited shall take his or live a corrupt or immoral life,
her place and shall preserve the or attempted against their
rights of compulsory heirs with virtue;
respect to the legitime. • When the parent/ascendant
• The disinherited parent shall not has been convicted of
have the usufruct or administration adultery or concubinage with
of the property which constitutes the the spouse of the testator;
legitime. • Loss of parental authority for
causes specified in the Code;
and
charges.
Page 45 of 117
• Attempt by one of the parents the will but from the heir or
against the life of the other, alienated in favor of estate
unless there has been the legatee or
reconciliation between them. devisee onerously
Not belonging to Effective
• Spouse: the testator at the
• When the spouse has given time the will is
cause for legal separation; executed but he has
• When the spouse has given ordered that the
grounds for the loss of thing be acquired in
parental authority order that it be
given to the
Revocation of Disinheritance: legatee/devisee
Not belonging to Void
• Reconciliation – the the testator at the
resumption of genuine cordial time the will is
relationship between the executed and the
testator and the disinherited testator
heir erroneously
• Subsequent institution of the believed that the
disinherited heir; and thing pertained to
• Nullity of the will which him
contains the disinheritance. Not belonging to Effective
the testator at the
LEGACIES AND DEVISES time the will is
executed but
Status of Property Effect on the afterwards
Given by Way of Legacy/Devise becomes his by
Legacy/Devise whatever title
Belonging to the Effective Already belonged Ineffective
testator at the time to the
of the execution of legatee/devisee at
the will until his the time of the
death execution of the
Belonging to the Revoked will even though
testator at the time another person
of the execution of may have interest
the will but therein
alienated in favor of Already belonged Ineffective
a 3rd person to the legatee or
Belonging to the No revocation. devisee at the time
testator at the time There is a clear of the execution of
of the execution of intention to comply the will even
the will but with legacy or though it may have
alienated in favor of devise. been subsequently
the legatee/devisee alienated by him
gratuitously Testator had Legatee/devisee
Belonging to the Legatee/devisee knowledge that the can claim nothing
testator at the time can demand thing bequeathed by virtue of the
of the execution of reimbursement belonged to a third legacy/devise
charges.
Page 46 of 117
person and the • A right by virtue of which,
legatee/devisee when two or more persons
acquired the are called to the same
property inheritance, devise or legacy,
gratuitously after the part assigned to one who
the execution of the renounce or cannot receive
will his share, or who died before
Testator had Legatee/devisee testator, is added or
knowledge that the can demand incorporated to that of his co-
thing bequeathed reimbursement heirs, co-devisees, or co-
belonged to a third from the heir or legatees
person and the estate
legatee/devisee INCAPACITY TO SUCCEED
acquired the
property by Based on Undue Influence or Interest
onerous title • Priest who heard the confession of
the testator during his last illness, or
RULES APPLICABLE TO INTESTACY the minister of the gospel who
extended spiritual aid to him during
• Rule of Preference between Lines the same period;
• Those in the direct descending • Individuals, associations and
line shall exclude those in the corporations not permitted by law to
direct ascending and inherit;
collateral lines, and those in • Guardian with respect to
the direct ascending line shall, testamentary dispositions given by a
in turn, exclude those in the ward in his favor before the final
collateral line. accounts of the guardianship have
• Rule of Proximity been approved, even if the testator
• The relative nearest in degree should die after the approval thereof;
excludes the more distant nevertheless, any provision made by
ones, saving the right of the ward in favor of the guardian
representation when it when the latter is his ascendant,
properly takes place descendant, brother, sister, or
• Rule of Equal Division spouse, shall be valid;
• Relatives in the same degree • Relatives of such priest or minister of
shall inherit in equal shares the gospel within the 4th degree, the
• Iron Bar Rule church, order, chapter, community,
• The illegitimate family cannot organization or institution to which
inherit by intestate succession such priest or minister may belong;
from the legitimate family • Attesting witness to the execution of
and vice-versa a will, the spouse, parents or
• Rule of Double Share for full blood children, or any one claiming under
collaterals such witness, spouse, parents or
• When full and half-blood children; and
brothers or sisters, nephews • Physician, surgeon, nurse, health
or nieces, survive, the full officer or druggist who took care of
blood shall take a portion in the testator during his last illness.
the inheritance double that of
the half-blood Based on Morality or Public Policy
• Right of Accretion • Those made in favor of a person with
whom the testator was guilty of
charges.
Page 47 of 117
adultery or concubinage at the time disinheritance, he thereby submits it to the
of the making of the will. rules on disinheritance. Thus, reconciliation
• Those made in consideration of a renders the disinheritance ineffective.
crime of which both the testator and
the beneficiary have been found NOTES ON OBLIGATIONS AND CONTRACTS
guilty.
• Those made in favor of a public Obligations - It is a juridical necessity to give,
officer or his spouse, descendants to do or not to do (Art. 1156, CC)
and ascendants, by reason of his
public office.  Elements
o Juridical tie – the legal or
Based on Acts of Unworthiness juridical relationship; the
• Parents who have abandoned their unifying bond
children or induced their daughters o Active subject – the obligee or
to lead a corrupt or immoral life, or creditor; the party who has
attempted against their virtue; the right to demand the
• Any person who has been convicted performance of the
of an attempt against the life of the obligation
testator, his/her spouse, o Passive subject – the obligor
descendants or ascendants; or debtor; the party who has
• Any person who has accused the the duty to perform the
testator of a crime for which the law obligation
prescribes imprisonment for 6 years o Prestation – the obligation to
or more, if the accusation has been be performed
found groundless;
• Any person convicted of adultery or  Note: The obligation must
concubinage with the spouse of the contemplate an active subject
testator; (creditor) and the obligation must be
• Any heir of full age who, having capable of pecuniary appreciation.
knowledge of the violent death of the
testator, should fail to report it to an • Sources
officer of the law within a month,
unless the authorities have already o Law
taken action; this prohibition shall • taxes, marital
not apply to cases wherein, and parental
according to law, there is no obligations
obligation to make an accusation; o Contracts
• Any person who by fraud, violence, ▪ sale, lease, simple
intimidation, or undue influence loan
should cause the testator to make a o Quasi-contracts
will or to change one already made; ▪ solutio indebiti
• Any person who falsifies or forges a o Quasi-delicts
supposed will of the decedent; and ▪ negligent torts
• Any person who by the same means o Delicts
prevents another from making a will, ▪ Reckless imprudence
or from revoking one already made, resulting in damage to
or who supplants, conceals, or alters property
the latter's will.
• An obligation imposed on a person,
Note: The moment the testator uses one of and the corresponding right granted
the acts of unworthiness as a cause for
charges.
Page 48 of 117
to another, must be rooted in at least o Availed when the creditor has
one of these five sources. The mere no other recourse.
assertion of a right and claim of an • Damages where appropriate
obligation in an initiatory pleading, o Art. 1170 provides that those
whether a Complaint or Petition, who in the performance of
without identifying the basis or their obligations are guilty of
source thereof, is merely a fraud,, negligence, or delay,
conclusion of fact and law. and those who in any manner
contravene the tenor thereof,
• A practice or custom is, as a general are liable for damages.
rule, not a source of a legally o Generally, it is ancillary to the
demandable or enforceable right. main relief, except when it is
Indeed, in labor cases, benefits which a separate action in cases of
were voluntarily given by the tort or quasi-delict.
employer, and which have ripened
into company practice, are Doctrine of anticipatory breach
considered as rights that cannot be
diminished by the employer. Under this doctrine, an unqualified
Nevertheless, even in such cases, the and positive refusal to perform a contract,
source of the employees’ right is not though the performance thereof is not yet
custom, but ultimately, the law, since due, may, if the renunciation goes to the
Article 100 of the Labor Code whole contract, be treated as a complete
explicitly prohibits elimination or breach which will entitle the injured party to
diminution of benefits. bring his action at once. (Blossom and
Company vs. Manila Gas, L-32958,
Right vs. Obligation November 8, 1930)
In every obligation there is a right in NATURE AND EFFECT OF OBLIGATIONS

favor of another
This right can be demanded and Personal vs. Real obligations
enforced by law ◦ Personal obligations =
The right must be rooted in any of the Obligations to do
sources of obligation (law, contract, etc.) ◦ Real obligations = Obligations
to give
Remedies in case of Breach
Note: Generally, rights and obligations are
• Specific performance/sum of money transmissible, except those that are personal
• Rescission to the party. Examples of obligations that are
o Implied in reciprocal (Art. intransmissible:
1191, CC) ◦ Rights and obligations of the
o Requires substantial breach. bailee in a contract of
The policy of the law is to commodatum
sustain the contract and allow ◦ Rights and obligations of a
the obligor to perform the partner in a partnership
obligation. (Song Fo vs.
Hawaiian Philippine Co., 47 Performance of obligations:
Phil 821 [1925], cited in ◦ According to the terms of the
Camarines Sur Teachers contract or law
Assoc. vs. Province of ◦ In good faith
Camarines Sure, [2019]) ◦ Pacta sunt servanda
(Art. 1315, Civil Code)
charges.
Page 49 of 117
◦ Rebus sic stantibus is no presumption of negligence, and it is
(Art. 1266-1267, Civil incumbent upon the injured party to prove
Code) the negligence of the defendant, otherwise,
the former’s complaint will be dismissed;
Thus: while in breach of contract, negligence is
◦ Art. 19, CC (to act with justice, presumed so long as it can be proved that
give everyone his due and there was a breach of the contract, and the
observe honesty and good burden is on the defendant to prove that
faith) there was no negligence in the carrying out
◦ Art. 1167, CC (to execute of the terms of the contract. (Huang vs.
what he failed to do and to Philippine Hoteliers, G.R. No. 180440,
undo what has been poorly December 5, 2012)
done)
Right to the Fruits (Art. 1164, CC)
To perform every obligation with DILIGENCE: ◦ Fruits refer to natural, civil
◦ Every obligation to do must and industrial fruits
be performed with the ◦ The oblige is entitled to the
diligence required by the fruits of the thing in
contract, law or nature of the obligations to give or deliver
obligation ◦ The right accrues from the
◦ Diligence depends on the time the obligation arises
nature of the obligation and
must correspond to Note: Even though the thing may have been
circumstances of the persons, delivered, if the contract does not involve
of the time and of the place transfer of ownership, there is no right to the
◦ When the law or contract fruits. The fruits will still pertain to the
does not provide the degree owner. Ex: commodatum, lease, deposit.
of diligence required, it is
understood to be simple Right to Accession (Art. 1166)
diligence or the diligence of a ◦ In obligations to give or
good father of a family deliver a thing
◦ Present even when it is not
Negligence is the omission of the diligence mentioned
required ◦ A contrary intent, however,
◦ It entitles the creditor or will prevail.
oblige a right to damages if
the obligation is performed To be differentiated from fruits under Art.
negligently. 1164, the term accessions in the present
◦ Also, it can be a separate article refers to the accession continua,
cause of action in torts and including the accession natural, such as
quasi-delicts. alluvion, and accession industrial, in its three
forms of building, planting or sowing.
Difference between negligence in quasi- (Tolentino)
delict and negligence in breach of contract:
Default or Delay
In quasi delict, negligence is direct, ◦ Requisites:
substantive and independent, while in ◦ That the obligation be
breach of contract, negligence is merely demandable and
incidental to the performance of the already liquidated;
contractual obligation, there is a pre-existing
contract or obligation. In quasi-delict, there
charges.
Page 50 of 117
◦ That the debtor
delays performance; ◦ When the obligation or the
and law expressly so declares;
◦ That the creditor ◦ When from the nature and
makes a judicial or the circumstances of the
extrajudicial demand obligation it appears that the
designation of the time when
• Art. 1169, CC – Those obliged to the thing is to be delivered or
deliver or to do something incur the service is to be rendered
in delay from the time the obligee was a controlling motive for
judicially or extrajudicially the establishment of the
demands from them the contract; or
fulfillment of their obligation. ◦ When the demand would be
• Note: The demand required in useless, as when the obligor
Article 1169 of the Civil Code may has rendered it beyond his
be in any form, provided that it power to perform (Art. 1169,
can be proved. The proof of this CC)
demand lies upon the creditor.
Without such demand, oral or Demand which Interrupts the Prescriptive
written, the effects of default do Period to File Action
not arise. (Cetus Development vs.
Court of Appeals, G.R. No. 77648, • The prescription of actions is
August 7, 2019) interrupted when they are filed
before the court, when there is
Default or Delay as a Ground for Payment of extrajudicial demand by the
Damages: creditors, ad when there is any
written acknowledgment of the debt
Default or mora, which is a kind of by the debtor. (Art. 1155, CC)
voluntary breach of an obligation, signifies • The interruption of the prescriptive
the idea of delay in the fulfillment of an period by written extrajudicial
obligation with respect to time. In positive demand means that the said period
obligations, like an obligation to give, the would commence anew from the
obligor or debtor incurs in delay from the receipt of the demand. x x x A
time the obligee or creditor demands from written extrajudicial demand wipes
him the fulfillment of the obligation. out the period that has already
Demand may be judicial-if the creditor files a elapsed and starts anew the
complaint against the debtor for the prescriptive period. (Ledesma vs. CA,
fulfillment of the obligation—or G.R. No. 106646, June 30, 1993, citing
extrajudicial—if the creditor demands from Overseas Bank of Manila vs. Geraldez
the debtor the fulfillment of the obligation [94 SCRA 937 (1979)]
either orally or in writing. Whether the
demand is judicial or extrajudicial, if the Delay in Reciprocal Obligations
obligor or debtor fails to fulfill or perform his
obligations, like payment of a loan, as in this • In reciprocal obligations, neither
case, he is in mora solvendi, and thus liable party incurs in delay if the other does
for damages. (Pineda vs. Vda. De Vega, G.R. not comply or is not ready to comply
No. 233774, April 10, 2019 [Caguioa]) in a proper manner with that is
incumbent upon him. From the
When demand is not necessary to put the moment one of the parties fulfills his
debtor in default:
charges.
Page 51 of 117
obligation, delay by the other begins. or, if it can be foreseen, it
(Art. 1169, CC) must be impossible to avoid;
• In a reciprocal obligation, the ◦ the occurrence must be such
performance of one is conditioned as to render it impossible for
on the simultaneous fulfillment of the debtor to fulfill
the other obligation. x x x A reciprocal obligations in a normal
obligation has been defined as that manner; and
“where each of the parties is a ◦ the obligor must be free from
promisee of a prestation and any participation in the
promises another in return as a aggravation of the injury or
counterpart equivalent of the other. loss.
(Ping Hian vs. Manas, G.R. No. ◦ Generally, the obligor is not
198867, October 16, 2019 [Caguioa]) liable unless the contrary is
stipulated by the parties (ex.
FRAUD – when present, it can either annul Insurance) and in cases
the contract or make the obligor liable for provided by law (ex.
damages commodatum, deposit,
◦ Dolo causante negotiorum gestio). In these
◦ Dolo incidente cases, the obligor assumes
◦ Acts not considered the risk of loss even if the loss
fraudulent: is caused by a fortuitous
event.
Art. 1340. The usual exaggerations in
trade, when the other party had an KINDS OF OBLIGATIONS
opportunity to know the facts, are not in
themselves fraudulent. ❑ Pure and conditional obligations
Art. 1341. A mere expression of an
opinion does not signify fraud, unless made ◦ Pure obligations - those
by an expert and the other party has relied whose effectivity or
on the former’s special knowledge. extinguishment does not
Art. 1342. Misrepresentation by a depend upon the fulfillment
third person does not vitiate consent, unless or non-fulfillment of a
such misrepresentation has created condition or upon the
substantial mistake and the same is mutual. expiration of a term or
Art. 1343. Misrepresentation made period. It is demandable at
in good faith is not fraudulent but may once.
constitute error. ◦ Conditional obligations -
those whose effectivity
Fortuitous Event depends upon the fulfillment
or non-fulfillment of a future
◦ Elements: and uncertain fact or event.
◦ the cause of the unforeseen
and unexpected occurrence ◦ Note: By default, if there are
or of the failure of the debtor no conditions attached,
to comply with obligations obligations are pure and
must be independent of demandable at once.
human will;
◦ it must be impossible to ❑ Kinds of conditions:
foresee the event that ◦ Suspensive conditions
constitutes the caso fortuito ❑ A suspensive
condition is a
charges.
Page 52 of 117
condition the
fulfillment of which Note:
gives rise to an ◦ A period is presumed to have
obligation of the party been established for the
in whose favor the benefit of both creditor and
condition is created. debtor.
Ex: full payment of the ◦ A potestative condition is
purchase price in a different from an obligation
contract to sell with a period. The former is
◦ Resolutory conditions void, the latter is valid. The
❑ A resolutory condition court may be asked to fix a
is one which period in an obligation with a
extinguishes rights period.
and obligations
already existing. Ex: in ❑ Alternative obligations
a pacto de retro sale, ◦ There is more than one
the repurchase by the obligation, the performance
previous owner of one is sufficient.
extinguishes the ◦ The debtor has the right of
previous sale election, and the choice is
◦ Potestative condition – one effective when it is
that depends upon the communicated to the
exclusive will of one of the creditor.
parties. Under Art. 1182 of ◦ If the creditor is given the
the Civil Code, it is considered right of election, the
void. obligation ceases to be
◦ Note: alternative from the time the
❑ Where the creditor communicates his
potestative condition choice.
is imposed not on the ◦ Distinguished from
birth of the obligation Facultative Obligations
but on its fulfillment, ● It is a facultative
only the condition is obligation when only
avoided, leaving one prestation has
unaffected the been agreed upon,
obligation itself. but the debtor may
(Catungal vs. render another in
Rodriguez, G.R. No. substitution.
146839, March 23,
2011) ❑ Joint and solidary obligations
❑ Obligations with a period ◦ In a "joint" obligation, each

◦ An obligation with a period is obligor answers only for a
one whose consequences are part of the whole liability;
subjected to the expiration of ◦ In a "solidary" or "joint and
a period or term. Ex. Price in a several" obligation, the
contract of sale payable on relationship between the
installment active and the passive
◦ The obligation is demandable subjects is so close that each
only when the day comes of them must comply with or
(Art. 1193, CC)
charges.
Page 53 of 117
demand the fulfillment of the others for their corresponding
whole obligation shares once payment has been
◦ Presume in favor of joint made.
obligations o Novation, compensation,
confusion or remission of the
❑ When the law imposes solidary debt, made by any of the solidary
liability creditors or with any of the
solidary debtors, shall extinguish
o Liability for quasi-delicts the obligation.
(Malayan Insurance vs. Court o But the remission made by the
of Appeals, L-36413, creditor of the share which
September 26, 1988) affects one of the solidary
o Liability of co-principals in a debtors does not release the
contract of agency (Art. 1915, latter from his responsibility
CC) towards the co-debtors, in case
o Liability of partners and the the debt has been totally paid by
partnership in wrongful acts anyone of them before the
committed against third remission was effected. (Art.
persons (Art. 1822 and 1823, 1219, CC)
CC)
o Liability of two or more ❑ Divisible and indivisible obligations
bailees in a commodatum
(Art. 1945, CC) ◦ Distinctions (Art. 1225, CC):
o Corporate officers are ● Divisible obligations
solidarily liable with the are which have for
corporation for the illegal their object the
termination of services of execution of a certain
employees IF they acted with number of days of
malice or bad faith. (Polymer work, the
vs. Salamuding, G.R. No. accomplishment of
185160, July 24, 2013) work by metrical units
and others which are
Effects of solidary obligation susceptible of partial
performance
o In active solidarity or where there ● Indivisible obligations
is solidarity of creditors, each are obligations to give
creditor is empowered to definite things and
exercise against the debtor not those which are not
only the rights which correspond susceptible of partial
to him, but also all the rights performance
which correspond to the other ◦ Whether it is divisible or
creditors with the consequent indivisible depends on the
obligation to render an law or the intention of the
accounting of his acts to such parties.
creditors.
o In passive solidarity or where ❑ Obligations with a penal clause
there is solidarity of debtors,
each debtor is liable for the ∙ The penalty shall substitute
payment of the entire obligation, the indemnity for damages
with the consequent right to and the payment of interests
demand reimbursement from the in case of non-compliance, if
charges.
Page 54 of 117
there is no stipulation to the partially to receive the
contrary. Nevertheless, prestations in which the
damages shall be paid if: obligation consists. Neither
● The obligor refuses to may the debtor be required
pay the penalty; to make partial payments.
● The obligor is guilty of (Art. 1248, CC)
fraud in the fulfillment
of the obligation. (Art. ❑ A creditor has the right to reject a
1226, CC) debtor’s offer to pay in installments.
∙ The penalty is generally Art. 1248 (CC) states that “[u]nless
undertaken to ensure there is an express stipulation to that
performance and works as effect, the creditor cannot be
either, or both, punishment compelled to receive partial
and reparation. It is an payments. Under this provision, the
exception to the general rules prestation, i.e., the object of the
on recovery of losses and obligation must be performed in one
damages. act, not in parts. (Barons Marketing
∙ A penal clause must be vs. Court of Appeals, G.R. No.
specifically set forth in the 126486, February 9, 1998)
obligation. (Rivera vs.
Spouses Chua, G.R. No. ❑ Acceptance vs. receipt
184458, January 14, 2015) ◦ The word “accept” in Art.
∙ The amount of the penalty or 1235, CC, means to take as
liquidated damages may be satisfactory or sufficient, or to
reduced by the court if found agree to an incomplete or
iniquitous or unconscionable. irregular performance. The
(Medel vs. Court of Appeals, mere “receipt” of a partial
G.R. No. 131622, November payment is not equivalent to
27, 1998) the required acceptance of
EXTINGUISHMENT OF OBLIGATIONS performance as would
extinguish the whole
Payment or Performance obligation (De Castro vs.
Court of Appeals, G.R. No.
◦ Payment is a mode of 115838, July 18, 2002)
extinguishing obligations and
it means not only the delivery When a creditor may accept payment by a
of money but also the third person:
performance, in any other ● When made by a third
manner, of an obligation. person who has an
(Art. 1231, CC) interest in the
◦ Integrity of payment – the fulfillment of the
thing or service in which the obligation; or
obligation exists must be ● When there is a
completely delivered or stipulation to the
rendered (Art. 1233, CC) effect that a third
◦ Identity of payment – the very person may pay the
thing, service or forbearance obligation.
must be performed (Art. ◦ When the debtor may pay to
1244, CC) a third person:
◦ Indivisibility of payment – the
creditor cannot be compelled
charges.
Page 55 of 117
● It has redounded to ◦ It is the designation of the
the benefit of the debt to which payment must
creditor; or be applied when the debtor
● The third person is in has several obligations of the
possession of the same kind in favor of the
credit in good faith. same creditor.
◦ Payment shall be made in the ◦ Generally, it is the debtor’s
legal tender. However, the right. But the creditor may
parties may agree that the make the selection if the
obligation or transaction be debtor does not elect or
settled in another currency. when there is an agreement
(Sec. 1, RA 8183) to that effect
◦ Promissory notes, checks, ◦ Payment shall be applied on
etc. shall have the effect of the interest first, in case the
payment only when they debt incurs interest (Art.
have been cashed or when 1253, CC)
through the fault of the
creditor they have been Dation in Payment
impaired. (Art. 1249, CC)
◦ A check may be used for the ◦ Requisites:
exercise of the right of ● Existence of a
redemption, the same being a monetary obligation
right and not an obligation. ● Alienation to the
The tender of a check is creditor of a property
sufficient to compel by the debtor with the
redemption but is not in itself consent of the former
a payment that relieves the ● Satisfaction of the
redemptioner from his money obligation of
liability too pay the the debtor
redemption price. (Fortunado ◦ Application of the law on
vs. Court of Appreals, G.R. No. sales. Ex. Adequacy of the
78556, April 25, 1991) price, warranties
◦ A check constitutes evidence
of indebtedness and is a Payment by Cession
veritable proof of an
obligation that can be used in ◦ This takes place when the
lieu of and for the same debtor cedes or assigns his
purpose as a promissory property to his creditors in
note. Thus, the checks, payment of his debts
completed and delivered to ◦ Compared to dation in
respondent, are sufficient per payment, cession involves
se to prove the existence of plurality of creditor, partial or
the loan obligation of complete insolvency,
petitioner to respondent. universality of property
(Padrigon vs. Palmero, G.R. ceded and the release is to
No. 218778, September 23, the extent of the proceeds of
2020) the things ceded or assigned.
Application of Payments Tender and Consignation
◦ Distinction
charges.
Page 56 of 117
• Tender of payment is o When he is incapacitated to receive
the manifestation of the payment at the time it is due;
the debtor to the o When, without just cause, he refuses
creditor of his to give a receipt;
decision to comply o When two or more persons claim the
immediately with his same right to collect.
obligation. o When the title of the obligation has
• Consignation is the act been lost
of depositing the
thing due with the Loss of the Thing due
court or judicial
authorities whenever ◦ In obligations to give, loss, as
the creditor cannot a mode of extinguishing an
accept or refuses to obligation, depends on the
accept payment and it thing involved
generally requires a ● If the thing is
prior tender of determinate, the
payment obligation is
extinguished
Requisites of valid consignation ● If the thing is generic
or indeterminate, the
◦ There was a debt due; obligation is NOT
◦ The consignation of the extinguished
obligation had been made following the principle
because the creditor to of genus nunquan
whom tender of payment was perit or the genus of a
made refused to accept it, or thing can never perish
because he was absent or ◦ In obligations to do, the
incapacitated, or because obligation is extinguished
several persons claimed to be when the prestation becomes
entitled to receive the legally or physically
amount due or because the impossible without the fault
title to the obligation has of the obligor
been lost;
◦ Previous notice of the Condonation or Remission of the Debt
consignation had been given
to the person interested in o It must be gratuitous;
the performance of the o It must be accepted by the
obligation; debtor;
◦ The amount due was placed o The obligation must be
at the disposal of the court; demandable
◦ After the consignation had
been made, the person Note:
interested was notified o It may become dation in
thereof payment when the creditor
receives a thing different
When prior tender of payment is excused from that stipulated;
o It may become novation
o When the creditor is absent or when the object or principal
unknown, or does not appear at the conditions of the obligation
place of payment; should be changed; and
charges.
Page 57 of 117
o It may become a compromise the same quality if the latter
when the matter renounced has been stated;
is in litigation or dispute and ◦ That the two debts be due;
in exchange of some ◦ That they be liquidated and
concession which the creditor demandable;
receives. (Dizon vs. Court of ◦ That over neither of them
Tax Appeals, G.R. No. 140944, there be any retention or
April 30, 2008) controversy, commenced by
third persons and
Confusion or Merger of Rights communicated in due time to
the debtor
∙
It is the merger of the
characters of the creditor and Requisites of conventional compensation:
the debtor in one and the ◦ That each of the parties can
same person by virtue of dispose of the credit he seeks
which the obligation is to compensate;
extinguished. ◦ That they agree to the mutual
∙ Requisites: extinguishment of their
● That the characters of credits.
creditor and debtor
must be in the same Novation
person;
● That it must take ∙ It is the extinguishment of an
place in the person of obligation by the substitution or
either the principal change of the obligation by a
creditor or the subsequent one which extinguishes
principal debtor or modifies the first, either:
● It must be complete ● by changing the
and definite object or principal
Compensation conditions;
● by substituting
◦ It is the extinguishment in the another in place of the
concurrent amount of the debtor; or
obligation of those persons ● by subrogating a third
who are reciprocally debtors person in the rights of
and creditors of each other the creditor
◦ Types: Requisites:
● Legal ● There must be a
● Voluntary or previous valid
conventional obligation;
● There must be an
Requisites of legal compensation: agreement of the
◦ That each one of the obligors parties concerned to a
be bound principally, and that new contract;
he be at the same time a ● There must be the
principal creditor of the extinguishment of the
other; old contract; and
◦ That both debts consist in a ● There must be the
sum of money, or if the things validity of the new
due are consumable, they be contract.
of the same kind, and also of
charges.
Page 58 of 117
Novation by substitution of debtor CONTRACTS - It is a meeting of the minds,
with respect to the other, to give something
∙ Substitution by expromision – or to render some service
the initiative of the change
does not come from—and • Kw: meeting of minds, parties,
may even be made without obligation
the knowledge of—the
debtor. It consists of a third Elements
person’s assumption of the
• Consent
obligation.
∙ Substitution by delegacion – • Object
the debtor offers, and the • Cause
creditor accepts, a third
Types
person who consents to the
substitution and assumes the
• Real, consensual, solemn
obligation.
Characteristics of Contracts
∙ In both cases, novation by
substitution of debtor must
• Relativity
always be made with the
consent of the debtor. • Obligatoriness
(Bognot vs. RRI Lending, G.R. • Mutuality
No. 180144, September 24, • Autonomy
2014)
Obligatoriness
Subrogation
The contract is (1) the law between
◦ It is the transfer of all the the parties, and (2) must be complied with in
rights of the creditor to a good faith.
third person, who substitutes
him in all his rights Autonomy of Contracts
Types of subrogation:
◦ Legal subrogation is that The contracting parties may establish
which takes place without such stipulations, clauses, terms and
agreement but by operation conditions as they may deem convenient,
of law because of certain acts, provided they are not contrary to law,
e.g. in insurance payouts or morals, good customs, public order, or public
indemnities where the policy. (Art.1306, Civil Code)
insurer is subrogated to the
rights of the insured against Mutuality
the third person who caused
the damage or injury Contracts bind all parties, and the
◦ Conventional subrogation is validity and compliance of contracts cannot
that which takes place by be left to the will of one of the parties.
agreement of the parties.
Conventional subrogation Relativity
extinguishes the obligation
and gives rise to a new one Contracts take effect only between
(Licaros vs. Gatmaitan, G.R. (1) the parties, (2) assigns (the persons to
No. 142838, August 9, 2001). whom the contract or rights and obligations
are transferred), and (3) heirs (persons who
will inherit in case of death of the parties).
charges.
Page 59 of 117
Stipulation pour autrui (Art. 1311, par. 2, rescission of the conveyance
Civil Code), requisites: to the third person;
o That the act being impugned
• The contract contains a stipulation in is fraudulent; and
favor of a third person; o That the third person who
• The stipulation in favor of third received the property
person must be only part and not the conveyed, if by onerous title,
whole of the contract; has been an accomplice in the
• The contracting parties clearly and fraud. ( Anchor Savings Bank
deliberately conferred a favor upon a vs. Furigay, G.R. No. 191178,
third person and not merely March 13, 2013)
incidental benefit or interest;
• The favorable stipulation must be not About the Consent
be compensated by any obligation;
• The third person must communicate • Offer and acceptance
his acceptance to the obligor before o An offer is a manifestation of
its revocation; willingness to enter into a
• The contracting parties are not legal bargain, so made as to justify
representatives or duly authorized by another person in
the third person to enter into the understanding that his assent
contract that gives the latter benefit. to that bargain is invited and
will conclude it.
Tortious Interference (Art. 1314, Civil o Acceptance means
Code), requisites: signification of conformity
with all the terms of the offer.
• The existence of a valid contract; The acceptance must be
• The third person must be aware of unqualified and
the existence of the contract; and unconditional.
• The interference of the third person o There is no perfected
must be without legal justification or contract if the offeree will not
excuse. accept but will just make a
counter-offer. If the
Compared to accion pauliana: acceptance is qualified, the
same is considered a counter-
• It is an action to rescind a contract offer.
entered in fraud of creditors.
Vices of Consent
• It is initiated by a stranger/third
person against parties to a contract.
• Mistake – as to the thing, conditions
• Requisites:
or the identity of a party
o That the plaintiff asking for
rescission has a credit prior to • Intimidation – reasonable fear of an
the alienation although impending and grave evil (moral)
demandable; • Violence – serious or irresistible force
o That the debtor has made a (physical)
subsequent contract • Undue influence – improper
conveying a patrimonial advantage of power over the will of
benefit to a third person; another
o That the creditor has no other • Fraud – deception, insidious
legal remedy to satisfy his machinations and manipulations
claim, but would benefit by
charges.
Page 60 of 117
About the Object o Cession of actions or rights
proceeding from an act
• Within the commerce of man appearing in a public
o Things and services are document.
outside the commerce of man
if they cannot be Reformation of Instruments
appropriated or they
incapable of private • When reformation is proper
ownership or if they are o There must have been a
intransmissible. meeting of minds of the
• Licit and not contrary to law, morals, parties to the contract
good customs, etc. o True intention of the parties
• Must not be impossible (physically, not expressed
legally, and practically) o Due to mistake, fraud,
• Must be determinate or at least inequitable conduct or
determinable accident
o The thing must be • When it is not proper
determinate as to its kind and o Donations inter vivos wherein
quantity. no condition is imposed
o The this is determinable if the o Wills
same can be determined o When the real agreement is
without that need to enter void
into an agreement.
Interpretation of Contracts, Rules:
About the Cause
 If terms are clear and
• Must exist at the time of the unambiguous, the literal
contract meaning of the terms
• Must be licit or lawful used is the controlling
• Must be true factor.
 If the meaning of the
Form of Contracts words is contrary to the
evident intent, then
• Contracts are valid in whatever form evident intent prevails.
(Art. 1356, CC)  The contemporaneous or
• When form is indispensable for its subsequent acts should
validity; when it is merely for be considered.
convenience  When there is a conflict
• Contracts that must be in a public between a general
instrument (Art. 1358, CC) provision and a particular
o Contracts involving real rights provision, the particular
over immovable property, or specific provision
sale of real property or any prevails.
interest therein;
o Cession, repudiation or It is elementary that any ambiguity in a
renunciation of hereditary contract whose terms are susceptible of
rights or those of the CPG; different interpretations must be read
o Power to administer against the party who drafted it. (Delgado vs.
property, power that may GQ Realty, G.R. No. 241774, September 25,
prejudice a third person; 2019, [Caguioa])
charges.
Page 61 of 117
o Those whose cause or object
Contract of Adhesion – one in which one of did not exist at the time of the
the parties imposes a ready-made form of transaction;
contract, which the other party may accept o Those whose object is outside
or reject, but which the latter cannot modify. the commerce of men;
One party prepares the stipulation in the o Those which contemplate an
contract, while the other party merely impossible service;
affixes his signature or his ‘adhesion’ o Those where the intention of
thereto, giving no room for negotiation and the parties relative to the
depriving the latter of the opportunity to principal object of the
bargain on equal footing. (Saludo vs. Security contract cannot be
Bank, G.R. No. 184041, October 13, 2010) ascertained; and
o Those expressly prohibited or
 Not invalid per se (Norton declared void by law.
Resources vs. All Asia
Bank, G.R. No. 162523,
November 25, 2009) SIMULATED CONTRACTS
 The terms of which must
be interpreted and o Simulation of contracts may
enforced stringently be absolute or relative. The
against the party which former takes place when the
prepared the contract. parties do not intend to be
(Fortune Medicare vs. bound at all; the latter, when
Amorin, G.R. No. 195872, the parties conceal their true
March 12, 2014) agreement. (Art. 1345, CC)
o An absolutely simulated or
DEFECTIVE CONTRACTS fictitious contract is void
while a relatively simulated
 Rescissible contracts contract when it does not
 Voidable contracts prejudice a third person and
 Unenforceable contracts is not intended for any
 Void or inexistent contracts purpose contrary to law,
morals, good customs, public
Strictly speaking, only the voidable and order or public policy binds
unenforceable contracts are defective the parties to their real
contracts and are the only ones susceptible agreement. (G. Holdings vs.
of ratification, unlike the rescissible ones Cagayan Electric, ibid)
which suffer from no defect and the void or
inexistent contracts which do not exist and Note:
are absolute nullity. (G. Holdings vs. Cagayan  A void contract produces
Electiric, G.R. No. 226213, September 27, no legal effect
2017, [Caguioa]))  It cannot be ratified
 The right to set it up as a
Void and inexistent contracts under Art. defense does not
1409, CC: prescribe
o Those whose cause, object or  The action to declare the
purpose is contrary to law, nullity of a contract does
morals, good customs, public not prescribe
order or public policy;  Courts will leave the
o Those which are absolutely parties as they are
simulated or fictitious;
charges.
Page 62 of 117
following the in pari Rescissible contracts under Article 1381,
delicto rule. CC:
o Those which are entered into
What is the doctrine of in pari delicto? by guardians whenever the
wards whom they represent
Under this doctrine, “no action arises, in suffer lesion by more than
equity or at law, from an illegal contract. No one-fourth of the value of the
suit can be maintained for its specific things which are the object
performance or to recover the property thereof;
agreed to be sold or delivered, or the money o Those agreed upon in
agreed to be paid, or damages for its representation of absentees,
violation. An exception to the doctrine is if the latter suffer the lesion
“when its application contravenes well- stated in the preceding
established public policy.” (Loria vs. Munoz, number;
G.R. No. 187240, October 15, 2014) o Those undertaken in fraud of
creditors when the latter
VOIDABLE CONTRACTS cannot, in any manner,
collect the claims due them;
o Generally, those where one o Those which refer to things
of the parties is incapable of under litigation if they have
giving consent, or when the been entered into by the
consent is vitiated by mistake, defendant without the
violence, intimidation, undue knowledge and approval of
influence or fraud. the litigants or of competent
judicial authority; and
• Note: o All other contracts specially
o The action to annul a contract declared by law to be subject
may be lost due to: to rescission.
▪ Prescription (4 years)
▪ Ratification by the Difference between Rescission under
injured party Art. 1191 and Rescissible Contracts
under Art. 1381
RESCISSIBLE CONTRACTS
o Art. 1191 applies to
o Contracts, although validly reciprocal obligations
agreed upon, which can be where one party fails to
rescinded by reason of lesion comply with his obligation
or economic prejudice. under the contract.
o Lesion is the injury suffered Substantial breach is
by one who does not receive required.
a full equivalent for what he o Art. 1381 applies to
gives in a commutative contracts where there is
contract. lesion, economic
disadvantage and fraud
• Requisites: committed against
o A contract initially valid; creditors.
o Lesion or pecuniary prejudice o Art. 1191 can only be
to someone. (G. Holdings vs. asserted by a party to the
Cagayan Electric, ibid) contract. Art. 1381 can be
asserted even by a third
person.
charges.
Page 63 of 117
o Contracts of lease for a period
Notes on Rescission longer than one year;
o Agreements for the sale of
o Rescission creates the real property or interest
obligation to return the therein; and
things which were the object o Representation as to the
of the contract, together with credit of a third person.
their fruits, and the price with
its interest. • Note:
o He who demands rescission o The Statute of Frauds
must be able to return requires that the contract be
whatever he may be obliged evidenced by some note,
to restore. memorandum or any writing.
o The action for rescission is o The Statute of Frauds applies
subsidiary; it cannot be only to executory contracts.
instituted except when the o The contracts supposedly
party suffering damage has covered by the Statute of
no other legal means to Frauds become enforceable
obtain reparation for the when they are ratified.
same.
o The action for rescission must NOTES ON NATURAL OBLIGATIONS
be commenced within 4 years
What are Natural Obligations (Art. 1423,
UNENFORCEABLE CONTRACTS Civil Code)?
o Those entered into in the • They are not based on positive law
name of another by one but on EQUITY AND NATURAL LAW;
without or acting in excess of
authority; • They DO NOT GRANT A RIGHT OF
o Those where both parties are ACTION to enforce their
incapable of giving consent (if performance;
only one of the parties is
incapable of giving consent, • After VOLUNTARY FULFILLMENT by
the contract is voidable); and the obligor, they authorize the
o Those which do not comply RETENTION of what has been
with the Statute of Frauds. delivered or rendered by reason
thereof
• Agreements covered by the Statute • In order that there may be a natural
of Frauds: obligation, there must exist a juridical
o Agreements not to be tie which is not prohibited by law,
performed within a year from and which could give a cause of
the making thereof; action, but because of some special
o Special promise to answer for circumstances is without such legal
a debt, default or miscarriage sanction or means of enforcing
of another; compliance by invoking the
o Agreement in consideration intervention of the court, (Tolentino)
of marriage other than a
mutual promise to marry; • An element of natural obligation
o Agreement for the sale of before it can be cognizable by the
goods, etc. at a price not less court is voluntary fulfillment by the
than P500.00;
charges.
Page 64 of 117
obligor. Certainly, retention can be ▪ Hence, no solutio
ordered but only after there has been indebiti
voluntary performance. (Ansay vs.
The Board of Directors, L-13667, April • Reimbursement to Third-Person
29, 1960) Payer (Art. 1425, CC)
• The term “voluntary” may be o When without the knowledge

understood as spontaneous, free or against the will of the
from fraud or coercion, or it may be debtor, a third person pays a
understood as meaning with debt which the obligor is not
knowledge, free from error. legally bound to pay because
(Tolentino) the action thereon has
prescribed, but the debtor
• Natural obligations as proper subject later voluntarily reimburses
of a guaranty (Art. 2052, CC) the third person, the obligor
cannot recover what he has
o The guaranty of the natural paid.
obligation changes its
character. When a debtor o Notes:
offers a guarantor for his ▪ The obligor knew the
natural obligation, he obligation has
impliedly accepts the prescribed.
coercive remedies to enforce ▪ The obligor did not ask
the guaranty, and, therefore, or compel the third
the transformation of the person to pay on his
natural into a civil obligation. behalf.
(Tolentino)  The obligor still
reimbursed the third
Examples of Natural Obligations person.
• Payment of an obligation which has • Voluntary performance after

already prescribed (Art. 1424, CC) Dismissal of Action (Art. 1428, CC)
o When a right to sue upon a o When, after an action to

civil obligation has lapsed by enforce a civil obligation has
extinctive prescription, the failed, the defendant
obligor who voluntarily voluntarily performs the
performs the contract cannot obligation, he cannot
recover what he has demand the return of what
delivered or the value of the he has delivered or the
services he has rendered payment of the value of the
service which he has
o Notes: rendered.
▪ The obligor knew the
obligation has o Notes:
prescribed. ▪ The action to enforce
▪ The payment was the obligation was
voluntary and not by dismissed.
mistake. ▪ The obligor is aware of
the dismissal.
charges.
Page 65 of 117
▪ The obligor voluntarily (personal property)
paid the obligation provided in the will to
despite the dismissal its recipient.
of the action.
NOTES ON ESTOPPEL
• Excess Payment by Heir (Art. 1429,
CC) What is Estoppel?
o When a testate or intestate • Through estoppel, an admission or

heir voluntarily pays a debt of representation is rendered
the decedent exceeding the conclusive upon the person making
value of the property which it, and cannot be denied or disproved
he received by will or by the as against the person relying thereon
law of intestacy from the (Art. 1431, CC)
estate of the deceased, the
payment is valid and cannot • In estoppel, a party creating an
be rescinded by the payer. appearance of fact, which is false, is
bound by that appearance as against
o Notes: another person who acted in good
▪ The estate is faith on it (Strong v. Gutierrez Repide,
insufficient to pay the 6 Phil. 680);
creditors of the
decedent. • Estoppel is based on public policy,
▪ The heir voluntarily fair dealing, good faith and justice. Its
paid the obligation/s purpose is to forbid one to speak
with his own money or against his own act, representations,
property. or commitments to the injury of one
who reasonably relied thereon
• Giving effect to Legacy in a Void Will
(Art. 1430, CC) Kinds of Estoppel
o When a will is declared void • Estoppel in pais

because it has not been
executed in accordance with o If by his conduct,
the formalities required by representations or
law, but one of the intestate admissions or silence when
heirs, after the settlement of he ought to speak out,
the debts of the deceased, whether intentionally or
pays a legacy in compliance through culpable negligence,
with a clause in the defective causes another to believe
will, the payment is effective certain facts to exist and such
and irrevocable. other rightfully relies and acts
on such belief, as a
o Notes: consequence of which he
▪ The will was not would be prejudiced if the
probated because it is former is permitted to deny
extrinsically void. the existence of such facts.
▪ The intestate heir/s
still voluntarily • Estoppel by deed
delivered the legacy
charges.
Page 66 of 117
o It occurs when a party to a exercising due diligence could nor
deed and his privies are should have been done earlier; it is
precluded from denying any negligence or omission to assert a
material fact stated in the right within a reasonable time,
said deed as against the other warranting a presumption that the
party and his privies. party entitled to assert it either has
• Estoppel by laches abandoned it or declined to assert it.
(Pinausukan Seafood House vs. Far
o A person who failed or East Bank, G.R. No. 159926, January
neglected to assert a right for 20, 2014)
an unreasonable and
unexplained length of time is How is Prescription different from Laches?
presumed to have
abandoned or otherwise • While prescription is concerned with
declined to assert such right the fact of delay, laches is concerned
and cannot later on seek to with the effect of delay. Prescription
enforce the same. is a matter of time; laches is
principally a question of inequity of
• Requisites of Laches: permitting a claim to be enforced,
this inequity being founded on some
o Conduct on the part of the change in the condition of the
defendant or one under property or the relation of the
whom he claims, giving rise to parties. Prescription is statutory;
the situation of which laches is not. Laches applies in
complaint is made and for equity, whereas prescription applies
which the complainant seeks at law. Prescription is based on fixed
a remedy; time, laches is not. (Maneclang vs.
o Delay in asserting the Baun, 208 SCRA 179, 193 [1992])
complainant’s right, the
complainant having had Applications of Estoppel
knowledge or notice of
defendant’s conduct and • In Sales:
having been afforded an o When a person who is not the
opportunity to institute a owner of a thing sells or
suit; alienates and delivers it, and
o Lack of knowledge or notice later the seller or grantor
on the part of the defendant acquires title thereto, such
that the complainant would title passes by operation of
assert the right on which he law to the buyer or grantee.
bases his claim; and (Art. 1434, CC)
o Injury or prejudice to the
defendant in the event relief o If a person in representation
accorded to the complainant of another sells or alienates a
or the suit is not held barred. thing, the former cannot
subsequently set up his own
What is Laches? title as against the buyer or
grantee. (Art. 1435, CC)
• Laches is the failure or neglect for an
unreasonable and unexplained • In Lease and Bailments:
length of time to do that which by
charges.
Page 67 of 117
o A lessee or a bailee is duties and the exercise of
estopped from asserting title certain powers by the latter.
to the thing leased or
received, as against the lessor Characteristics
or bailor. (Art. 1436, CC)
• It is a relationship;
• In Property: • It is a relationship of fiduciary
o When in a contract between character;
third persons concerning • It is a relationship with
immovable property, one of respect to property, not one
them is misled by a person involving merely personal
with respect to the ownership duties;
or real right over the real • It involves the existence of
estate, the latter is precluded equitable duties imposed
from asserting his legal title upon the holder of the title
or interest therein, provided to the property to deal with
all these requisites are it for the benefit of another;
present: and
• It arises as a result of a
o There should be fraudulent manifestation of intention to
representation or wrongful create the relationship.
concealment of facts known
to the party estopped; Parties
o The party precluded must
intend that the other should • Trustor, or the person who
act upon the facts as establishes the trust
misrepresented;
o The party misled must have
• Trustee, or the person in
been unaware of the true
whom confidence is reposed
facts; and
as regards property for the
o The party defrauded must
benefit of another
have acted in accordance
with the misrepresentation.
(Art. 1437, CC) • Beneficiary, or the person for
whose benefit the trust has
• One who has allowed another to
been created
assume apparent ownership of
Types of Trust
NOTES ON TRUSTS
What is a Trust? • Express trust or one that

comes into existence only by
the manifestation of an
• It is the legal relationship
intention to create it by the
between one person having
one having legal and
an equitable relationship in
equitable dominion over the
property and another person
property made subject to it.
owning the legal title to such
There must exist a
property, the equitable
competent trustor and
ownership of the former
trustee, an ascertainable
entitling him to the
trust res, and sufficiently
performance of certain
certain benefiaries. It is
charges.
Page 68 of 117
created by some writing or arises because it was
deed or will, or by words acquired through fraud,
evidencing an intention to duress, undue influence or
create a trust. mistake, or through breach
of a fiduciary duty, or
• Note that under Art. 1443, through the wrongful
Civil Code, no express trusts disposition of another’s
concerning an immovable or property.
any interest therein may be
proved by parol evidence. Implied trusts under the Civil Code
Note, however, the ruling of
the Supreme Court in Ringor • Art. 1448, CC (Sale to and transfer to
vs. Ringor infra. one person but the price is paid for
by another)
• Implied trust or one that
comes into existence either o When not applicable:
through implication of an o Where A pays the purchase
intention to create a trust as price and the title is conveyed
a matter of law or through by absolute deed to A’s child
the imposition of the trust or to a person to whom A
irrespective of, and even stands in loco parentis and
contrary to any, such who makes no express
intention. promise, the presumption
• Note that, unlike express being that a gift was
trusts, under Art. 1457, Civil intended.
Code, an implied trust may o Where a transfer or property
be proved by oral evidence. is made to one person and
the purchase price is
Types of Implied Trust advanced by another as a
loan to the transferee.
• Resulting trust or one that
arises where a person makes • Art. 1449, CC (Donation to a person
or causes to be made a but beneficial interest is not enjoyed
disposition of property under by him or that the beneficial interest
circumstances which raise an is vested in another)
inference that he does not
intend that the person taking • Art. 1450, CC (Purchase with
or holding the property borrowed funds, the legal title vested
should have the beneficial in the lender or payor only to secure
interest in the property. the payment of the debt)
• Constructive trust or one • Art. 1451, CC (Legal title to land is

imposed where a person inherited by the heir but placed in the
holding title to property is name of another)
subject to an equitable duty o For example, one heir
to convey it to another on succeeded in having the title
the ground that he would be of the land transferred from
unjustly enriched if he were the name of the decedent to
permitted to retain it. The his name. A constructive
duty to convey the property trust is thus created in favor
charges.
Page 69 of 117
of the defrauded heirs.
What is a Quasi-Contract?
• Art. 1452, CC (Legal title to land is
taken or placed in the name of one • It is a lawful unilateral act which is
co-owner) voluntarily performed that imposes
upon the person benefitted by the
act to reimburse or compensate the
Art. 1453, CC (Conveyance to a person in
actor based on the principle that no
• reliance upon his promise to hold it
one shall be enriched at the expense
for or to transfer it to another)
of another
• The function of a quasi-contract is to
• Art. 1454, CC (Absolute conveyance
raise obligation in law where in fact
to a person to secure the
the parties made no promise, and it
performance of grantor’s obligation
is not based on apparent intention of
to him)
the parties.
o When the obligation is
Negotiorum Gestio
fulfilled, the grantor can
demand reconveyance of the
• Elements:
property.
o Subject matter is a property
or business of another person
• Art. 1455, CC (Purchase of property
called the owner;
by a trustee with use of trust funds
o Property or business has been
and causing legal title to be placed in
abandoned;
his name or in another)
o A person called officious
manager or gestor voluntarily
o For example:
takes charge of the
o Fund mangers, with respect
management of the property
to trust funds
or business without the
o Agents, with respect to
express consent or authority
property or funds of the
of the owner;
principal
o The officious manager or
o Attorney, with respect to
gestor must not be acting
property or funds of the client
erroneously on the belief that
he is the owner of the
• Art. 1456, CC (Acquisition of property
property or business.
through mistake or fraud; the person
acquiring it becomes the trustee for
the benefit of the true owner) • Obligations of the Gestor:
o To continue the management
o For example: until the termination of the
o Acquisition by one from a affair and its incidents or until
thief and the former knows he is substituted
that it is a product of theft o To exercise the diligence of a
o Solutio indebiti under Art. good father of the family
2154, CC o To answer for the acts of a
delegate
o To be liable for loss even if
caused by a fortuitous event
(Arts. 2147-2148, CC)
NOTES ON QUASI-CONTRACTS
charges.
Page 70 of 117
▪ If he undertakes risky o It is a tie or juridical relation
operations which the which, by virtue of a payment
owner was not of what is not due, made
accustomed to through mistake, is created
embark upon; between the person who paid
▪ If he has preferred his and the one who received the
own interest to that of payment, compelling the
the owner latter, in consequence
▪ If he fails to return the thereof, to return what he
property or business has received.
upon demand by the • Requisites:
owner; • There is payment or delivery
▪ If he assumed the by the obligee of a thing not
management in bad due or owing to the obligor;
faith; • The payment was made by
▪ If he is manifestly mistake
unfit to carry on the • Obligation of the “payee”:
management; • To return it;
▪ If by the intervention • To pay legal interest or be
he prevented a more liable for fruits if he accepted
competent person it in bad faith;
from taking up the • If what was accepted was a
management. thing certain and
o To enter into contract with determinate, the payee shall
third person be liable for impairment or
loss of the thing or its
• Obligations of the Owner: accessions and accessories
o To be liable for obligations insofar as he was benefited
incurred by the gestor in his
(owner’s) interest; NOTES ON SALES
o To reimburse the gestor for
necessary and useful WHAT IS A CONTRACT OF SALE?
expenses and for damages
which the gestor suffered. In a contract of sale, one of the contracting
parties obligates himself to transfer the
• Extinguishment of Negotiorum ownership of and to deliver a determinate
Gestio: thing, and the other to pay therefore a price
o When the owner repudiates it certain in money or its equivalent. (Art.
or puts an end thereto; 1458, Civil Code)
o When the officious manager Essential Requisites:
withdrawn from the • Consent or meeting of the
management; minds;
o By the death, civil • Determinate subject matter;
interdiction, insanity or and
insolvency of the owner or • Price certain in money or its
the officious manager equivalent.
Solutio Indebiti Types of contract of sale

• Absolute Sale vs. Conditional
• Concept: Sale
charges.
Page 71 of 117
• Conditional Sale vs. Contract cured when the original owner sold
to Sell the property to Isabel.
Parties to a Contract of Sale Art. 1434 does not apply when it is in conflict
• Vendor vs. Vendee with the provisions of other laws. Thus:
• Qualifications and capacity to
give consent • In Hermosilla vs. Remoquillo (G.R. No.
• Relative incapacity of certain 167320, January 30, 2007), the
persons to enter into a Supreme Court did not apply Art.
contract of sale 1434 when at the time of the sale of
the property, the seller was
Notes on the consent prohibited by law to sell or convey
the privilege to buy the land before it
• There must be a meeting of was awarded to him.
the minds over the subject • In Marcelo vs. Marcos (L-17072,
matter and the price October 31, 1961), the Supreme
• The meeting of minds takes Court held that the subsequent
place when there is a acquisition by the mortgagor of title
concurrence of the offer and to the property through a free patent
acceptance. does not validate the mortgage
• If there are conditions or because the Public Land Act prohibits
accidental stipulations, these the use of the land for the
must also be agreed upon by satisfaction of debts within 5 years
the parties pursuant to the from the issuance of the patent.
consensuality of contracts
Effect of loss of the thing
Notes on the Subject Matter • Prior to delivery – seller HAS THE RISK
OF LOSS
• Determinate • After delivery – buyer HAS THE RISK
• Licit and within the OF LOSS
commerce of man • Exception: (Art. 1504, Civil
• Nemo dat quod non habet Code)
• The seller must have a • Where delivery of the
right to transfer the goods has been made
ownership thereof. to the buyer or to a
The requirement need bailee for the buyer,
be present only at the in pursuance of the
time of delivery. contract and the
ownership in the
What about Art. 1434, Civil Code? goods has been
Art. 1434 provides that when a person who retained by the seller
is not the owner of a thing sells or alienates merely to secure
and delivers it, and later the seller or grantor performance by the
acquires title thereto, such title passes by buyer of his
operation of law to the buyer or grantee. obligations under the
contract, the goods
• in Castrillo vs. Court of Appeals (L- are at the buyer's risk
18046, March 31, 1964) the seller from
(Isabel) was not yet the owner when • the time of such
she sold the property to the buyer delivery;
(Dimaranan), but the defect was
charges.
Page 72 of 117
• Where actual delivery • To take care of the thing pending
has been delayed delivery (Art. 1163, CC)
through the fault of • To pay for the expenses of the
either the buyer or contract
seller the goods are at • Execution of a public instrument
the risk of the party in under Art. 1358, CC
fault
OBLIGATIONS OF THE VENDEE
Notes on the Price • To pay the price
• Requirement as to integrity
• THE PRICE MUST BE certain and identity of payment
• When it is agreed upon by the • the price will owe
parties (Art. 1473, CC); interest (from the
• When it is in reference to time of delivery until
another thing certain (Art. payment of the price):
1469, CC); • If it is so
• When the determination stipulated;
thereof is left to the judgment • If the thing
or specified person or sold or
persons (Ibid). delivered
produce fruits
Manner of payment (TOYOTA SHAW CASE) or income;
• Failure of consideration vs. • If the buyer is
lack of consideration in default, to
• Varying be counted
remedies from the time
• Inadequacy vs. simulation of of demand
price • Grounds for suspension of
• Earnest money vs. option payment of the price
money • If the buyer is
• First Optima Realty vs. disturbed in the
Securitron, G.R. No. possession or
199648, January 28, ownership of the
2015 (re: Payment of thing acquired; or
earnest money does • If he has reasonable
not always mean a grounds to fear such
perfected contract of disturbance by a
sale; the consent of vindicatory action or a
the parties must be foreclosure of
clearly established) mortgage
• Right of first refusal • To accept delivery
• Buyer has the right to a
PERFORMANCE OF THE CONTRACT reasonable opportunity to
examine the thing.
OBLIGATIONS OF THE VENDOR • Acceptance is deemed made
• To transfer ownership after buyer has made an
• To deliver the thing, its fruits, examination.
accessions and accessories (Art. 1164
and 1166, CC) DELIVERY
• To warrant against eviction and • The ownership of the thing sold shall
against hidden defects be transferred to the vendee upon
charges.
Page 73 of 117
the actual or constructive delivery the failure of the vendee to take
thereof. (Art. 1477, Civil Code) actual possession of the land sold.
• The thing is delivered when it is (Ten Forty Realty vs. Cruz, G.R. No.
placed in the control and possession 151212, September 10, 2003)
of the vendee. (Art. 1497, Civil Code)
• Modes of Delivery FAILURE OF THE CONTRACT; REMEDIES
• Actual • Action for specific performance
• Constructive or legal • Rescission
• Any other manner • In sale of real property
(Art. 1496, CC) • Absolute Sale – Apply
• Constructive delivery according to Art. 1191 and 1592),
type of property: Civil Code, (Spouses
• Real property Garcia vs. Court of
• Execution of public Appeals, G.R. No.
instrument 172036, April 23,
• Traditio constitutum 2010)
possessorium • Sale on Installment/
• Personal property Contract to Sell –
• Execution of public Apply Republic Act
instrument 6552 (Maceda Law)
• Symbolic delivery
• Traditio longa manu • In sale of personal property (Art.
• Traditio brevi manu 1593, CC)
• Traditio constitutum • Rescission:
possessorium • The vendee, upon the
• Incorporeal property expiration of the
• Execution of public period fixed for the
instrument delivery of the thing
• Placing of titles of purchased, refused to
ownership in the receive it without
possession of the vendee justifiable cause; or
• Exercise by the vendee of • He failed to pay the
his rights with the price, unless granted a
vendor’s consent. longer period within
Note!!! which to pay.
By agreement, delivery may not result in the • Note: in case of Sale of
transfer of ownership: Personal Property on
• The parties may stipulate that Installment – Apply
ownership in the thing shall not pass Art. 1484, CC (Recto
to the purchaser until he has fully Law)
paid the price. (Art. 1478, CC)
Action for damages (Art. 1596, 1599, CC)
Constructive delivery is merely presumptive • Where the buyer
• The execution of a public instrument wrongfully neglects or
gives rise only to a prima facie refuses to accept and
presumption of delivery. Such pay for the goods
presumption is destroyed when the • When there is a
delivery is not effected because of a breach of warranty by
legal impediment. Such constructive the seller
or symbolic delivery, being merely
presumptive, is deemed negated by
charges.
Page 74 of 117
Warranties defendant or by the
• Express warranty is any affirmation filing of a third-party
of fact or any promise by the seller complaint against said
relating to the thing if the natural vendors. (Escaler vs.
tendency of such affirmation or Court of Appeals, L-
promise is to induce the buyer to 42636, August 1,
purchase the same, and if the buyer 1985)
purchases the thing relying thereon. • There is no waiver on the part
(Art. 1546, CC) of the vendee (Art. 1554, CC);
• The vendee is in good faith
Implied Warranty (J.M. Tuason vs. Court of
• Implied warranty is inherent in a Appeals, L-41233, November
contract of sale. It is presumed to 21, 1979)
exist although nothing has been
mentioned about it. (Pineda) Warranty against hidden defects
• Implied warranty may be modified or • The defect must be such that it
suppressed by agreement of the renders the thing unfit for the use for
parties. (Art. 1548, 1566, CC) which it is intended, or it diminishes
• Implied warranties in Sales its fitness for such use to such an
• Implied warranty extent that, had the vendee been
against eviction aware thereof, he would not have
• Take note of acquired it or would have given a
requisites lower price for it (Art. 1561, CC);
• Implied warranty • The defect must be hidden or cannot
against hidden be discovered by ordinary inspection
defects or examination (Art. 1561, CC);
• Take note of • The defect must be present at the
prescriptive time of the execution of the sale;
period • The vendee has not waived the
• Implied warranty of warranty (Art. 1566, CC).
fitness or
merchantability Prescriptive Period for Rescission or
Reduction of the Price (Warranty Against
Implied warranty against eviction Hidden Defects)
• The vendee is deprived in • 6 months from delivery
whole or in part of the thing • 40 days (in case of animals)
purchased (Art. 1557, CC); from delivery
• He is so deprived by virtue of
a final judgment (Art. 1557, Warranty of fitness and merchantability
CC); • The first is a warranty that the goods
• The vendor was summoned in are suitable for the particular or
the suit for eviction at the special purpose disclosed by the
instance of the vendee (Art. buyer which will not be satisfied by
1558, CC); the mere fitness of the goods for
• The vendor/s should general purposes. The second is a
be made parties to warranty that the goods purchased
the suit at the are reasonably fit for the general
instance of vendees, purposes for which they are sold.
either by way of (Pineda)
asking that the former
be made a co- EXTINGUISHMENT OF SALE
charges.
Page 75 of 117
Conventional Redemption – It takes place • Types of Legal Redemption
when the vendor reserves the right to • Legal Redemption by a Co-
repurchase the thing sold, with the Owner
obligation to comply with the provisions of • Legal Redemption by
Article 1616 and other stipulations which Adjacent Owners of Rural
may have been agreed upon. (Art. 1601, CC) Lands
• Equitable mortgage – It is one • Pre-Emption and Legal
which, although lacking in Redemption by Adjacent
some formality, or form or Owners of Urban Lands
words, or other requisites
demanded by a statute, Statute of Limitation
nevertheless reveals the • The right of legal pre-emption or
intention of the parties to redemption shall not be exercised
charge real property as except within thirty days from the
security for a debt, there notice in writing by the prospective
being no impossibility nor vendor, or by the vendor, as the case
anything contrary to law in may be. (Art. 1623, CC)
this intent. (Rockville vs.
Spouses Miranda, G.R. No. Duty to Serve Written Notice to Possible
155716, October 2, 2009) Redemptioners
• The deed of sale shall not be
When a Sale with Right of Repurchase is recorded in the Registry of Property,
presumed to be an Equitable Mortgage (Art. unless accompanied by an affidavit of
1602, CC): the vendor that he has given written
• When the price of a sale with right to notice thereof to all possible
repurchase is unusually inadequate; redemptioners.
• When the vendor remains in • But!!! Co-owners with actual notice
possession as lessee or otherwise; of the sale are not entitled to written
• When upon or after the expiration of notice. x x x A written notice of a fact
the right to repurchase, another already known to them, would be
instrument extending the period of superfluous. (Spouses Si vs. Court of
redemption or granting a new period Appeals, G.R. No. 122047, October
is executed; 12, 2000)
• When the purchaser retains for
himself a part of the purchase price; NOTES ON LEASE
• When the vendor binds himself to
pay the taxes on the thing sold; What is a lease of things?
• In any other case where it may be
fairly inferred that the real intention In the lease of things, one of the parties
of the parties is that the transaction binds himself to give to another the
shall secure the payment of a debt or enjoyment or use of a thing for a price
the performance of any other certain, and for a period which may be
obligation. definite or indefinite. However, no lease for
more than ninety-nine years shall be valid.
Legal Redemption - the right to be (Art. 1643, Civil Code)
subrogated, upon the same terms and
conditions stipulated in the contract, in the Note:
place of one who acquires a thing by 1. The lessor transfers merely the
purchase or dation in payment, or by any temporary use and enjoyment of the
other transaction whereby ownership is thing leased. (Reyes vs. Court of
transmitted by onerous title. (Art. 1619, CC)
charges.
Page 76 of 117
Appeals, G.R. No. 127608, September What are the obligations of the lessor and
30, 1999) lessee?
2. The lessor’s right of use is impaired,
therein. He may even be ejected by Obligations of the Lessor:
the lessee if the lessor uses the 1. To deliver the thing in such a
leased realty. (Roxas vs. Court of condition as to render it fit for the
Appeals, G.R. No. 92245, June 26, use intended;
1991) 2. To make all necessary repairs on the
3. Being a consensual contract, a lease thing;
is perfected at the moment there is a 3. To maintain the lessee in peaceful
meeting of the minds upon the thing and adequate enjoyment of the lease
and the cause or consideration which for the entire duration of the
are to constitute the contract. contract.
(Bugatti vs. Court of Appeals, G.R. No. Obligations of the Lessee:
138113, October 17, 2000) 1. To pay rent;
2. To use thing leased as a diligent
What is a lease of work or services? How is it father of a family, devoting it to the
different from contract of agency? use stipulated;
3. To pay expenses for the deed of
In the lease of work or service, one of the lease;
parties binds himself to execute a piece of 4. To notify the lessor of usurpation or
work or to render to the other some service untoward acts;
for a price certain, but the relation of 5. To notify the lessor of need for
principal and agent does not exist between repairs;
them. (Art. 1644, Civil Code) 6. To return the property leased upon
termination of the lease.
In both agency and lease of services one of
the parties binds himself to render some What is the term of a lease if no period has
service to the other party. Agency, however, been agreed upon?
is distinguished from lease of work or
services in that the basis of agency is According to Art. 1687 of the Civil Code, it
representation, while in the lease of work or shall be understood to be from year to year,
services the basis is employment. The lessor if the rent agreed upon is annual; from
of services does not represent his employer, month to month, if it is monthly; from week
while the agent represents his principal. to week, if the rent is weekly; and from day
(Nielson & Co. vs. Lepanto Consolidated to day, if the rent is to be paid daily.
Mining, L-21601, December 28, 1968)
Payment of the stipulated rents were made
Meanwhile, how is it different from an on a monthly basis and, as such, the period
employer-employee relationship? of lease is considered to be from month to
month in accordance with Article 1687 of the
The work of (a lessor of work or service) Civil Code. Moreover, a lease from month-
more nearly approximates that of an to-month is considered to be one with a
independent contractor than that of an definite period which expires at the end of
employee. The latter is paid for the labor he each month upon a demand to vacate by the
performs, that is, for the acts of which such lessor. (Arquelada vs. Philippine Veterans
labor consists; the former is paid for the Bank, G.R. No. 139137, March 31, 2000)
result thereof. (Investment Planning vs.
Social Security System, L-19124, November May a lessee lawfully suspend payment of
18, 1967) rent?
charges.
Page 77 of 117
Grounds for Suspension of Payment of Rent What are the grounds for ejecting the lessee
(Art. 1658, Civil Code): under RA 9653 or the Rent Control Act?
 In case the lessor fails to make the ▪ Assignment of lease or subleasing of

necessary repairs; or residential units in whole or in part
 When the lessor fails to maintain the without the written consent of the
lessee in peaceful and adequate owner/lessor
enjoyment of the property leased. ▪ Arrears in payment of rent for a total
of three (3) months
What are the grounds for rescinding the ▪ Legitimate need of the owner/lessor
lease? to repossess his or her property for
his or her own use of for the use of an
Grounds for Rescission: immediate member of his or her
family as a residential unit
• If the lessor or lessee should not ▪ Need of the lessor to make necessary
comply with his or her obligations repairs of the leased premises which
(Art. 1659, Civil Code); is the subject of an existing order of
• If a dwelling place or any other condemnation by appropriate
building intended for human authorities concerned in order to
habitation is in such a condition that make the said premises safe and
its use brings imminent and serious habitable
danger to life or health (Art. 1660, ▪ Expiration of the period of the lease
Civil Code); contract.
• When the repair works shall render
the portion which the lessee and his More on the Rent Control Law
family need for their dwelling
uninhabitable and the main purpose Note:
of the lease is to provide a dwelling ▪ RA 9653 applies to all residential
place for the lessee (Art. 1662, Civil units in the NCR and other highly
Code) urbanized cities, the total monthly
rent for each of which ranges from
What are the grounds for ejecting the lessee P1.00 to P10,000.00 and all
under the Civil Code? residential units in all other areas,
the total monthly rent for each of
• When the period agreed upon, or which ranges from P1.00 to
that which is fixed for the duration of P5,000.00
leases under Art. 1682 and 1687, has ▪ It imposes a limit on increases in rent.
expired; Under the National Human
• Lack of payment of the price Settlements Board Resolution No.
stipulated; 2020-04, the Rent Control is
• Violation of any of the conditions extended until December 31, 2021.
agreed upon in the contract; Thus, the rent of any residential unit
• When the lessee devotes the thing shall not be increased by:
leased to any use or service not ▪ More than 2% annually for those
stipulated which causes the paying a monthly rent ranging from
deterioration thereof; or if he does P1.00 to P4,999.00
not observe the requirement in No. 2 ▪ More than 7% for those paying a
of Art. 1657, as regards the use monthly rent ranging from P5,000.00
thereof. to P8,999.00; and
▪ More than 11% for those paying a
monthly rent ranging from P9,000.00
charges.
Page 78 of 117
to P10,000.00. owner of the leased property.
• Failure on the part of the lessee to
Extrajudicial Repossession of the Premises remove improvements at the time of
the expiration of the lease, there
A stipulation in the written contract of lease being no true accession, constitutes a
which authorizes repossession of the waiver or abandonment of his right
premises without court action is valid. It "is to remove such improvements
in the nature of a resolutory condition, for (Cabangis vs. Court of Appeals, 200
upon the exercise by the lessor of his right to SCRA 414[1991])
take possession of the leased property, the
contract is deemed terminated;" and that Is a lessee a builder in good faith with right
such a contractual provision "is not illegal, of reimbursement provided under Art. 448,
there being nothing in the law prescribing in relation to Art. 546 of the Civil Code?
such kind of agreement.” (Viray vs.
Intermediate Appellate Court, G.R. No. Being mere lessees, the private respondents
81015, July 4, 1991; Irao vs. By the Bay, Inc., knew that their occupation of the premises
G.R. No. 177120, July 14, 2008) would continue only for the life of the lease.
Plainly, they cannot be considered as
What are the rules respecting the possessors nor builders in good faith.
improvements introduced by the lessee? In a plethora of cases, this Court has held
that Article 448 of the Civil Code, in relation
Under Art. 1678, Civil Code, if the lessee to Article 546 of the same Code, which
makes, in good faith, useful improvements allows full reimbursement of useful
which are suitable to the use for which the improvements and retention of the premises
lease is intended, without altering the until reimbursement is made, applies only to
property leased, a possessor in good faith, i.e., one who
• The lessor may pay the lessee ½ of builds on land with the belief that he is the
the value of the improvement; or owner thereof. It does not apply where one's
• The lessee may remove the only interest is that of a lessee under a rental
improvements, without causing any contract; otherwise, it would always be in
more impairment upon the property. the power of the tenant to "improve" his
With regard to ornamental expenses, the landlord out of his property. (Geminiano vs.
lessee shall not be entitled to Court of Appeals, 328 Phil. 682 [1996],
reimbursement but he may remove the reiterated in Anita C. Buce vs. Spouses
ornamental objects, provided no damage is Galeon, G.R. No. 222785, March 2, 2020)
caused to the property and the lessor does
not choose to retain them by paying their In a plethora of cases, this Court has held
value. that Articles 448 of the Civil Code, in relation
to Article 546 of the same Code, which
Note: allows full reimbursement of useful
• Art. 1678, Civil Code gives the lessor improvements and retention of the premises
and not the lessee the option until reimbursement is made, applies only to
provided therein. a possessor in good faith, i.e., one who
• The concept of possessor in good builds on land with the belief that he is the
faith for purposes of entitling a owner thereof. It does not apply where
possessor to reimbursement for one’s only interest is that of a lessee under a
improvements made by him on the rental contract; otherwise, it would always
property possessed does not apply to be in the power of the tenant to "improve"
a lessee’s right regarding such his landlord out of his property. (Parilla vs.
improvements because as such Pilar, G.R. No. 167680, November 30, 2006)
lessee he knows that he is not the
charges.
Page 79 of 117
What is tacita reconduccion or implied new Renewal of lease and Increase of Rentals
lease?
➢ The period of the lease contract is
Under Art. 1670, Civil Code, if at the end of deemed to have been set for the
the contract the lessee should continue to benefit of both parties. Its renewal
enjoy the thing leased for 15 days with the may be authorized only upon their
acquiescence of the lessor, and unless a mutual agreement or at their joint
notice to the contrary by either party has will. Its continuance, effectivity or
previously been given, it is understood that fulfillment cannot be made to
there is an implied new lease, with the depend exclusively upon the free and
following periods: uncontrolled choice of just one party.
1. In case of rural lands, for the time While the lessee has the option to
necessary for the gathering of the continue or to stop paying the
fruits; rentals, the lessor cannot be
2. In case of urban lands, it is completely deprived of any say on
understood to be year to year, month the matter. (LL and Company vs.
to month, week to week, or day to Huang Chao Chun, G.R. No. 142378,
day, depending on the rent paid or March 7, 2002)
agreed upon. ➢ A unilateral increase in the rental
Elements of tacita reconduccion: rate is void, considering that the
1. The term of the original contract has option to renew is reciprocal and,
expired; thus, the terms and conditions
2. The lessor has not given the lessee a thereof -- including the rental rate --
notice to vacate; and must likewise be reciprocal. (LL and
3. The lessee continued enjoying the Company vs. Huang Chao Chun,
thing leased for 15 days with the supra)
acquiescence of the lessor.
NOTES ON PARTNERSHIP
Note:
• Tacit renewal (tacita reconduccion) is Partnership is traditionally a Business
not a contract without term entered Organization
into by the parties, but an implied
renewal of a previous contract ▪ People have at least three choices to
• (Ledesma vs. Pictain, L-597, August do business:
29, 1947) ▪ Sole proprietorship
• The terms of the original contract ▪ Partnership
which are revived in the implied new ▪ Corporations
lease are only those terms which are ▪ A sole proprietorship is a business
germane to the lessee’s right of owned by one individual who makes
continued enjoyment of the property the decisions, receives all the profits
leased. It does not ipso facto carry and suffers the losses. The business
with it any implied revival of an does not have a personality separate
option to purchase the leased from the owner.
premises. The right to exercise the ▪ Traditionally, a corporation is an
option to purchase expired with the organization of people authorized by
termination of the original contract law to act as a single entity. It has a
of lease. (Dizon vs. Court of Appeals, personality separate from the
G.R. No. 122544, January 28, 1999; shareholders or members. As an
Mańas vs. Nicolasora, G.R. No. entity, it can do business, own and
208845, February 3, 2020)) hold property, and its liabilities are
not the liabilities of the people who
charges.
Page 80 of 117
comprise it. Under the Revised ▪ Under the two Codes, partnerships
Corporation Code, however, a single were classified into commercial and
individual can form a One Person civil partnerships. They were formed
Corporation (OPC). according to and subject to different
▪ A partnership is an association of two rules. Some legal requirements
or more persons who act as co- govern commercial partnerships but
owners of a business. It has a not civil partnerships.
separate legal personality, but the ▪ With the present Civil Code, the
partners are subsidiarily liable for distinctions have been eliminated.
partnership debts. All partnerships are defined and
governed by Art. 1767 to At. 1867 of
Advantages of Partnership the Civil Code, supplemented by
other laws.
▪ Easy to organize
▪ Availability of more capital and credit WHAT IS A PARTNERSHIP?
(compared to sole proprietorship)
▪ Retention of profits ▪ A partnership is a contract where two
▪ Better business skills and knowledge or more persons bind themselves to
contribute money, property, or
Disadvantages of Partnership industry to a common fund, with the
intention of dividing the profits
▪ Unlimited liability (of general among themselves. Two or more
partners) persons may also form a partnership
▪ Lack of stability for the exercise of a profession. (Art.
▪ Management disagreement 1767, CC)
▪ Idle investment ▪ Elements of a partnership:
▪ An agreement to contribute
Law on Partnership Then and Now money, property, or industry
to a common fund, and
▪ Before the present Civil Code, laws ▪ Intent to divide the profits
on partnership were taken from: among the contracting
parties. (Jarantilla vs.
▪ Code of Commerce - for Jarantilla, G.R. No. 154486,
commercial partnerships December 1, 2010)
▪ Old Civil Code - for civil
partnerships Organizations deemed Partnerships
▪ Difference between commercial or governed by the Law on Partnership
partnerships and civil partnerships:
▪ Professional partnerships
▪ Commercial partnerships - ▪ Partnerships formed by
those which are established persons for the sole purpose
with the view to effecting one of exercising their common
or more commercial profession, no part of the
operations. income of which is derived
▪ Civil partnerships - those from engaging in any trade or
where two or more persons business.
bind themselves to place ▪ Joint ventures
money, property, or industry ▪ A joint venture is likened to a
in common with the intention particular partnership or one
of dividing the profits among which "has for its object
themselves. determinate things, their use
charges.
Page 81 of 117
or fruits, or a specific has a right to choose with
undertaking, or the exercise whom he wishes to associate
of a profession or vocation.” himself (Ortega vs. Court of
However, both are different Appeals, G.R. No. 109248,
in the sense that a joint July 3, 1995)
venture is limited to a single ▪ Doctrine of Mutual Agency
transaction, while a ▪ Under the doctrine of mutual
partnership generally relates agency, all the partners shall
to a continuing business of be considered agents and
various transactions of a whatever any one of them
certain kind. (Heirs of Tan Eng may do alone shall bind the
Kee vs. Court of Appeals [G.R. partnership (Art. 1803[1],
No. 126881, October 3, 2000] 1818, CC)
and Realubit vs. Jaso [G.R. No. ▪ Rule that partners are guarantors of
178782, September 21, the obligations of the partnership
2011]) ▪ Under the rule that partners
▪ Note, however, that a joint are guarantors of partnership
venture is not a legal entity. It obligations, the partners are
does not enter into contracts, liable to the creditors of the
hire employees or have its partnership with their own
own tax liabilities. property, even beyond their
▪ Characteristics of a partnership contribution. (Art. 1816, CC)
▪ Consensual – perfected by
mere consent Consequences of the Partnership being a
▪ Nominate – has a special Juridical Person
name or designation under
the law ▪ As a juridical person, the partnership
▪ Bilateral – entered into by may:
two or more persons and the ▪ acquire and possess property
rights and obligations arising of all kinds;
therefrom are reciprocal ▪ incur obligations; and
▪ Onerous – each of the parties ▪ bring civil or criminal actions.
aspires to procure for himself (Art. 46, Civil Code)
a benefit ▪ As a juridical person, the personality
▪ Commutative – the of the partnership is separate and
undertaking of each partner distinct from that of each of the
is considered as the partners. (Aguila vs. Court of
equivalent of that of the Appeals, G.R. No. 127347, November
others 25, 1999)
▪ Principal – does not depend ▪ Note:
upon some other contract for ▪ A partnership for the practice
its existence or validity of law, constituted in
▪ Preparatory – entered into as accordance with the Civil
a means to an end Code provisions on
partnership, acquires juridical
Principles affecting the Partnership personality by operation of
relationship law. (Saludo vs. PNB, G.R. No.
193138, August 20, 2018)
▪ Doctrine of Delectus Personae
▪ Under the doctrine of Who can form Partnerships?
delectus personae, a partner
charges.
Page 82 of 117
▪ Persons with legal capacity to enter otherwise;
into contracts ▪ As wages of an employee or
▪ Natural persons should be at rent to a landlord;
least 18 years old, not ▪ As an annuity to a widow or
suffering from any legal representative of a deceased
impediment such as insanity partner;
or civil interdiction ▪ As interest on a loan, though
▪ Juridical persons de jure the amount of payment vary
▪ Husband and wife can enter into with the profits of the
particular partnerships but not business;
universal partnerships. (CIR vs. Suter, ▪ As the consideration for the
27 SCRA 152 [1969]) sale of a goodwill of a
▪ Reason: Husband and wife business or other property by
cannot sell and donate to one installments or otherwise.
another (Art. 1769 [4], CC)
▪ It used to be that corporations
cannot enter into a partnership. But, Distinction between a Co-ownership and a
under the Revised Corporation Code, Partnership
corporations can now join
partnerships. (Section 35[h], ▪ There is a co-ownership when an
Republic Act 11232) undivided thing or right belongs to
different persons (Art. 484, CC). It is a
Tests and Rules to Determine Existence of a partnership when two or more
Partnership persons bind themselves to
contribute money, property, or
▪ By estoppel, if the persons treat each industry to a common fund, with the
other as partners (Art. 1825, CC); intention of dividing the profits
▪ Co-ownership or co-possession does among themselves (Art. 1767, CC).
not of itself establish a partnership, ▪ Co-ownership or co-possession does
whether such co-owners or co- not of itself establish a partnership,
possessors do or do not share any whether such co-owners or co-
profits made by the use of the possessors do or do not share any
property (Art. 1769 [2], CC); profits made by the use of the
▪ The sharing of gross returns does not property (Art. 1769 [2], CC)
of itself establish a partnership, ▪ The sharing of returns does not in
whether or not the persons sharing itself establish a partnership whether
them have a joint or common right or or not the persons sharing therein
interest in any property from which have a joint or common right or
the returns are derived (Art. 1769 [3], interest in the property. There must
CC); be a clear intent to form a
▪ The receipt by a person of a share of partnership, the existence of a
the profits of a business is prima facie juridical personality different from
evidence that he is a partner in the the individual partners, and the
business, but no such inference shall freedom of each party to transfer or
be drawn if such profits were assign the whole property. (Pascual
received in payment: vs. CIR, G.R. No. 78133, October 18,
1988)
Tests and Rules to Determine Existence of a
Partnership Distinction between a Partnership and
Employment
▪ As a debt by installments or
charges.
Page 83 of 117
▪ The existence of a partnership is vs. Lazo, G.R. No. 200555, January 20,
established when it is shown that: (1) 2021)
two or more persons bind Form of the Partnership Contract
themselves to contribute money,
property, or industry to a common ▪ General rule: Contracts shall be
fund; and (2) they intend to divide obligatory in whatever form they
the profits among themselves. may have been entered into,
Generally, it is not required that the provided all the essential requisites
agreement be in writing or in a public for their validity are present (art.
instrument. Still, the best evidence to 1356, CC).
prove the existence of a partnership ▪ In the following instances, the
is the contract or articles of partnership contract should be in
partnership. Nevertheless, in its writing:
absence, its existence can be ▪ When, by its terms, it is not to
established by circumstantial be performed within a year
evidence. Under Article 1769 of the from the making thereof.
Civil Code, "the receipt by a person of (Art. 1403[2][a], CC)
a share of the profits of a business is ▪ Where immovable property
a prima facie evidence that he is a or real rights are contributed
partner in the business, [but] no such thereto. (Art. 1771, CC)
inference shall be drawn if such ▪ Aside from being in
profits were received in payment writing, it should also
as wages of an employee [or rent to be in a public
a landlord]." In addition, "the sharing instrument.
of gross returns does not of itself ▪ An inventory of the
establish a partnership, whether or contributed property
not the persons sharing them have a duly signed by the
joint or common right or interest in parties should also be
any property from which the returns attached to the public
are derived.“ instrument. This is
indispensable to the
▪ On the other hand, an employee is validity of the
any person in the service of another partnership. (Litonjua
under a contract for hire, express, or vs. Litonjua, G.R. No.
implied, oral or written. To 166299-300,
determine whether an employment December 13, 2005)
relationship exists, the following
elements are considered: (1) the ▪ Where the capital is P3,000.00 or
selection and engagement of the more, in money or property. (Art.
employee; (2) the payment of wages; 1772, CC)
(3) the power of dismissal; and (4) ▪ Aside from being in writing, it
the employer's power to control the should also be in a public
employee's conduct. No particular instrument.
form of evidence is required to prove ▪ It must be filed with or
the existence of an employer- recorded in the Securities and
employee relationship. Any Exchange Commission.
competent and relevant evidence to Note:
prove the relationship may be The failure to register the contract of
admitted. However, a finding that partnership does not invalidate the same as
such relationship exists must still rest among the partners, so long as the contract
on some substantial evidence. (Dusol has the essential requisites, because the
charges.
Page 84 of 117
main purpose of registration is to give notice are liable pro rata and subsidiary
to third parties, and it can be assumed that (Art.1816) and sometimes solidarily
the members themselves knew of the (Arts. 1822-1824) with their separate
contents of their contract. (Sunga-Chan vs. property for partnership debts; or
Chua, G.R. No. 143340, August 15, 2001) ▪ Limited partnership or one formed by
two or more persons having as
Effects of a Partnership created for Unlawful members one or more general
Purposes partners and one or more limited
partners, the latter not being liable
▪ A partnership must have a lawful for the obligations of the
object or purpose and must be partnership.
established for the common benefit 3) As to its duration, a partnership is either:
or interest of the partners (Art. 1770, ▪ Partnership at will or one in which no
CC) time is specified and is not formed for
▪ Effects of an unlawful partnership: a particular undertaking or venture,
▪ The contract is void ab initio and which may be terminate anytime
and the partnership never by mutual agreement of the
existed in the eyes of the law partners, or by the will of any one
(Art. 1409[1]); partner alone; or one for a fixed term
▪ The partnership will be or particular undertaking which is
dissolved, and the profits continued by the partners after the
confiscated in favor of the termination of such term or
government (Art. 1770, CC); particular undertaking without
▪ The instruments or tools and express agreement (Art. 1785); or
proceeds of the crime shall
also be forfeited in favor of ▪ Partnership with a fixed term or one
the government, but the which the term for which the
contributions of the innocent partnership is to exist is fixed or
partners shall not be agreed upon or one formed for a
confiscated. (Art. 1411-1412, particular undertaking, and upon the
CC) expiration of the term or completion
of the particular enterprise, the
CLASSIFICATIONS AND RELATIONS partnership is dissolved, unless
continued by the partners.
Classifications of Partnership 4) As to the legality of its existence, a
partnership may be:
1) As to the extent of its subject matter, a
partnership may be: ▪ De jure partnership or one which has
complied with all the legal
▪ Universal partnership or one which requirements for its establishment;
refers to all the present property or or
to all profits. ▪ De facto partnership or one which
▪ Particular partnership or one which has failed to comply with all the legal
has for its object determinate things, requirements for its establishment.
their use of fruits, or a specific 5) As to representation to others, a
undertaking, or the exercise of a partnership may be:
profession or vocation (Art. 1783).
2) As to liability of the partners, a ▪ Ordinary or real partnership or one
partnership may be: which actually exists among the
▪ General partnership or one partners and also as to third persons;
consisting of general partners who or
charges.
Page 85 of 117
▪ Ostensible partnership or partnership ▪ Liquidating partner or one who takes
by estoppel or one which in reality is charge of the winding up of
not a partnership, but is considered a partnership affairs upon dissolution.
partnership only in relation to those ▪ Partner by estoppel or one who is not
who, by their conduct or admission, really a partner, not being a party to
are precluded to deny or disprove a partnership agreement, but is liable
their existence. as a partner for the protection of
6) As to publicity, a partnership may be: innocent third persons.
▪ Continuing partner or one who
▪ Secret partnership or one wherein continues the business of a
the existence of certain persons as partnership after it has been
partners is not avowed or made dissolved by reason of the admission
known to the public by any of the of a new partner, or the retirement,
partners; or death or expulsion of one or more
▪ Open or notorious partnership or one partners.
whose existence is avowed or made ▪ Surviving partner or one who
known to the public by the members remains after a partnership has been
of the firm. dissolved by the death or any
7) As to purpose, a partnership may be: partner.
▪ Commercial or trading partnership or ▪ Subpartner or one who, not being a
one formed for the transaction of member of the partnership,
business; or contracts with a partner with
Professional or non-trading partnership or reference to the latter’s share in the
one formed for the exercise of a profession. partnership
KINDS OF PARTNERS UNIVERSAL PARTNERSHIP
▪ Capitalist partner or one who ▪ Universal Partnership of all Present

contributes money or property to the Property
common fund. ▪ The partners contribute all
the property which actually
▪ Industrial partner or one who belongs to them to a common
contributes only his industry or fund, with the intention of
personal service. dividing the same among
themselves, as well as all the
▪ General partner or one whose profits which they may
liability to third persons extends to acquire therewith (Art. 1778,
his separate property; he may be CC)
either a capitalist or industrial ▪ “Property” refers to both
partner. He is also known as real movable (like cash) and
partner. immovable (like real
▪ Limited partner or one whose liability property).
to third persons is limited to his ▪ Only present property can be
capital contribution. He is also contributed. By present
known as special partner. property, it means property
▪ Managing partner or one who which belongs to the partners
manages the affairs or business of at the time of the constitution
the partnership; he may be of the property.
appointed either in the articles of ▪ Profits acquired from the use
partnership or after the constitution of the property may also be
of the partnership. contributed.
charges.
Page 86 of 117
▪ Future property which may
be acquired from inheritance,
legacy or donation cannot be
included. However, the fruits COMMENCEMENT OF PARTNERSHIP AND
therefrom can be OBLIGATION TO CONTRIBUTE
contributed. ▪ A partnership begins from the
▪ Universal Partnership of Profits moment of the execution of the
▪ It comprises all that the contract, unless it is otherwise
partners may acquire by their stipulated. (Art. 1784, CC)
industry or work during the ▪ Registration with the
existence of the partnership Securities and Exchange
(Art. 1780, CC) Commission is not essential
▪ What passes to the to give the partnership
partnership is the income juridical personality.
from the industry or work of ▪ Every partner is a debtor of the
the partners and the use or partnership for whatever he may
usufruct (fruits) of the have promised to contribute thereto.
property which the partners (Art. 1786, CC)
may possess at the time of ▪ A partner who has undertaken to
the celebration of the contribute a sum of money and fails
partnership contract. to do so becomes a debtor for the
▪ interest and damages from the time
▪ Since the law speaks of profits he should have complied with his
acquired through industry or work, obligation (Art. 1788, CC)
profits acquired through chance are ▪ A partner who contributes property
not included. is bound to warrant the thing against
▪ Also, since the law refers to the eviction (Art. 1786, CC)
usufruct of present property, fruits
from future property are not Note:
included. ▪ The remedy against the partner who
delays in his contribution is specific
▪ Persons who are prohibited from performance, not dissolution.
giving each other any donation or ▪ The liability for interest commences
advantage cannot enter into not from the time of demand, judicial
universal partnership (Art. 1782, CC) or extrajudicial, but from the time
▪ Spouses, who are prohibited the partner should have complied
from forming universal with the obligation or from the time
partnerships, may form he converted the amount to his own
particular partnerships (CIR use, as the case may be.
vs. Suter, L-25532, February ▪ A partner is guilty of estafa if he
28, 1969) fraudulently appropriates
partnership property delivered to
PARTICULAR PARTNERSHIP him with specific directions to apply
▪ It has for its object determinate it to partnership purposes.
things, their use or fruits, or specific
undertaking, or the exercise of a RISK OF LOSS OF THINGS CONTRIBUTED (Art.
profession or vocation. (Art. 1783, 1795, CC)
CC)
▪ The object of a particular partnership
is limited and well-defined.
charges.
Page 87 of 117
Nature or character Who bears the risk
Nature or Who bears the risk of the thing of loss?
character of the of loss? Specific and The partner because
thing determinate things he remains the
Specific and The partner which are not owner
determinate things because he fungible where only
which are not remains the owner the use is
fungible where contributed
only the use is Specific and The partnership
contributed determinate things because it is the
Specific and The partnership the ownership of owner
determinate things because it is the which is transferred
the ownership of owner to the partnership
which is Fungible things or The partnership
transferred to the things which cannot because ownership
partnership be kept without was transferred
Fungible things or The partnership deteriorating even if since use is
things which because ownership they are contributed impossible without
cannot be kept was transferred only for the use of the things being
without since use is the partnership consumed or
deteriorating even impossible without impaired.
if they are the things being partnership gives its express
contributed only consumed or permission.
for the use of the impaired.
partnership On the Capitalist Partner:
▪ The capitalist partners cannot
PROHIBITION AGAINST ENGAGING IN engage for their own account in any
BUSINESS operation which is of the kind of
business in which the partnership is
On the Industrial Partner: engage, unless there is a stipulation
▪ An industrial partner cannot engage to the contrary. (Art. 1808, CC)
in business for himself, unless the ▪ A capitalist partner may carry on a
partnership expressly permits him to business activity not connected or
do so. (Art. 1789, CC) competing with that of the
▪ An industrial partner becomes a partnership.
debtor of the partnership for his
SANCTIONS FOR VIOLATING THE
work or services from the moment of
PROHIBITION
the commencement of the
partnership. In effect, the
Guilty Industrial Partner:
partnership acquires an exclusive
The other partners may
right to avail itself of his industry.
▪ exclude him from the firm; or
Consequently, if he engages in
▪ avail of the benefits which he may
business (of whatever kind--even
have obtained
though not the same as the
▪ With a right to damages in
partnership) for himself, such act is
either case.
considered prejudicial to the interest
Guilty Capitalist Partner:
of the other partners. The rule,
however, does not apply if the
charges.
Page 88 of 117
▪ He shall bring to the common funds the result of one particular
any profits from the other business; transaction but of all the transactions
and had.
▪ He shall personally bear the losses ▪ If there is also no profit-sharing
stipulated in the contract, then losses
RULES ON CONTRIBUTION AND SHARES shall be borne by the partners in
proportion to their capital
Capital: contributions, but the purely
▪ That stated in the agreement shall industrial partner shall not be liable
prevail; for the losses.
▪ In the absence thereof, the share LIABILITY TO PAY DAMAGES SUFFERED BY
shall be equal; THE PARTNERSHIP (Art. 1794, CC)
▪ In case of imminent loss of the
business, additional share as may be ▪ Every partner is responsible to the
determined by the majority. partnership for damages suffered by
Profits: it through his fault, and he cannot
▪ The partners share the profits compensate them with the profits
according to their agreement subject and benefits which he may have
to Art. 1799. earned for the partnership by his
industry.
▪ If there is no such agreement: ▪ However, the courts may equitably
▪ The share of each capitalist lessen this responsibility if through
partner shall be in proportion the partner's extraordinary efforts in
to his capital contribution. other activities of the partnership,
▪ The industrial partner shall unusual profits have been realized.
receive such share, which
must be satisfied first before DUTY TO ACCOUNT
the capitalist partners shall
divide the profits, as may be ▪ Art. 1807. Every partner must
just and equitable under the account to the partnership for any
circumstances. The share of benefit, and hold as trustee for it any
an industrial partner in the profits derived by him without the
profits is not fixed as in the consent of the other partners from
case of the capitalist partners any transaction connected with the
as it is very difficult to formation, conduct, or liquidation of
ascertain the value of the the partnership or from any use by
services of a person. him of its property.
▪ Art. 1809. Any partner shall have the
Losses: right to a formal account as to
▪ The losses shall be distributed partnership affairs:
according to their agreement subject ▪ If he is wrongfully excluded from the
to Article 1799. partnership business or possession of
▪ If there is no such agreement, but the its property by his co-partners;
contract provides for the share of the ▪ If the right exists under the terms of
partners in the profits, the share of any agreement;
each in the losses shall be in ▪ As provided by article 1807;
accordance with the profit sharing ▪ Whenever other circumstances
ratio, but the industrial partner shall render it just and reasonable.
not be liable for losses. The profits or
losses of the partnership cannot be PARTNERSHIP BOOKS
determined by taking into account
charges.
Page 89 of 117
▪ The duty to keep true and correct partnership in the transaction of its
partnership books rest on the business
managing or active partner. ▪ It is a fundamental principle
▪ As a general rule, the books should in the law of agency that
be kept at the principal place of every delegation of authority,
business. whether general or special,
▪ Each partner has a right to free carries with it, unless the
access to them and to inspect or copy contrary be expressed,
any of them at any reasonable time, implied authority to do all of
even after dissolution. those acts, naturally and
▪ The books should not be removed ordinarily done in such cases,
from where they are kept without which are reasonably
the consent of all the partners. necessary and proper to be
done in order to carry into
THE MANAGING PARTNER effect the main authority
conferred. (Citibank, N.A. vs.
HOW A MANAGING PARTNER IS APPOINTED Chua, G.R. No. 102300, March
17, 1993)
▪ Through the Articles of Partnership
▪ After the constitution of the DUTY OF TRUST WITH RESPECT TO
partnership (not through the Articles PARTNERSHIP MONEY (Art. 1792, CC)
of Partnership)
▪ If a partner authorized to manage
HOW APPOINTMENT OF MANAGING collects a demandable sum which
PARTNER IS REVOKED was owed to him in his own name,
from a person who owed the
▪ In case the appointment is in the partnership another sum also
Articles of Partnership, he may only demandable, the sum thus collected
be removed (a) for lawful cause or if shall be applied to the two credits in
he acted in bad faith, and (b) through proportion to their amounts, even
the vote of the partners representing though he may have given a receipt
the controlling interest. for his own credit only; but should he
▪ Art. 1927, CC – An agency have given it for the account of the
cannot be revoked x x x if a partnership credit, the amount shall
partner is appointed manager be fully applied to the latter.
of a partnership in the ▪ The provisions of this article are
contract of partnership and understood to be without prejudice
his removal from the to the right granted to the other
management is unjustifiable. debtor by Article 1252,* but only if
▪ If the appointment is after the the personal credit of the partner
constitution of the partnership, he should be more onerous to him.
may be removed for whatever cause ▪ Art. 1252 (CC) – He who has
provided the removal is done various debts of the same
through the vote of the partners kind in favor of one and the
representing the controlling interest. same creditor, may declare at
the time of making the
POWERS OF A MANAGING PARTNER payment, to which of them
the same must be applied.
▪ acts of administration
▪ all incidental powers necessary to WHEN THERE ARE TWO OR MORE
carry out the object of the MANAGING PARTNERS
charges.
Page 90 of 117
RIGHT TO SPECIFIC PARTNERSHIP PROPERTY
▪ Powers of two or more managing
partners whose respective duties are ▪ The right covers tangible property.
not specified: ▪ The specific property belongs to the
▪ If one or more of the partnership as a separate juridical
managing partners shall personality. The partners have no
oppose the acts of the others, actual interest in it until after
then the decision of the dissolution.
majority (per head) of the ▪ Equal right with other partners to
managing partners shall possess specific partnership property
prevail. for partnership purposes.
▪ In case of tie, the matter shall ▪ The right is not assignable except in
have to be decided by the connection with the assignment of
vote of the partners owning rights of all partners in the same
the controlling interest, that property.
is, more than 50% of the ▪ It is not subject to legal support
capital investment.
▪ When unanimity of action required: INTEREST IN THE PARTNERSHIP
▪ if it should be stipulated that
none of the managing ▪ The right to share in the profits and
partners shall act without the losses.
consent of the others. ▪ Disposal, alienation and use of a
▪ absence or disability of one of partner’s share:
them is not an excuse. ▪ A partner owns his respective
▪ exception: when there is share
imminent danger of grave or ▪ He can associate with another
irreparable injury to the in the enjoyment thereof,
partnership, in which case, convey his interest and the
unanimity may not be same can be subject of
required. attachment or execution
WHEN MANAGEMENT NOT AGREED UPON WHAT IS A SUB-PARTNERSHIP

(Art. 1803, CC)
Contract of sub-partnership - a partnership
▪ When there is no stipulation on the formed between a member of a partnership
management of the partnership, and a third person for a division of the profits
every partner is a managing partner coming to him from the partnership
and an agent of the partnership. He enterprise. It is a partnership within a
may do acts of administration and all partnership and is distinct and separate from
incidental powers necessary to carry the main or principal partnership.
out the object of the partnership. Query: (1)Is it really a partnership
However, this act of management does not when what are shared in common are merely
extend to altering immovable property for the profits of the particular partner and there
that would be an act of dominion. In this is no sharing of funds nor an intention to do
case, all the other partners must give their business as a partnership?
consent. If the refusal of consent is (2) How is it different from
prejudicial to the partnership, court assignment (of interest in the profits) and
intervention may be sought. from charging order?
PROPERTY RIGHTS RIGHTS OF SUB-PARTNER OR ASSOCIATE
charges.
Page 91 of 117
▪ only to share in the profits; administration of the
▪ a sub-partner does not become a partnership business or
member of the partnership; affairs
▪ he does not acquire the rights of a ▪ Assignee cannot demand
partner (e.g. to inspect partnership information, accounting and
books); inspection of partnership
▪ he is not liable for partnership debts; books
WHAT IS A CHARGING ORDER? RIGHT TO PARTICIPATE IN MANAGEMENT
▪ Charging Order ▪ The parties can appoint a Managing

▪ It is a remedy of a judgment Partner who can execute all acts of
creditor of a partner administration (Art. 1800, CC)
▪ The judgment creditor ▪ The other partners can
applies for a charging order remove the managing
after securing judgment on partner due to
his credit to subject the mismanagement or any other
interest of the debtor partner cause
with payment of unsatisfied ▪ If no Managing Partner has been
amount of the judgment appointed, all the partners shall be
debt. considered agents of the
▪ The interest charged may be partnership. None of them may
redeemed at any time before make any important alteration in the
foreclosure, or in case of a immovable property of the
sale being directed by the partnership without the consent of
court, may be purchased the others. (Art. 1803, CC)
without thereby causing a ▪ In case of disagreement, the
dissolution. decision of the majority shall
prevail. In case of a tie, the
▪ How redeemed: decision of the partners
▪ With separate property by owning the controlling
any one or more of the interest shall prevail. (Art.
partners; or 1801, CC)
▪ With partnership property, by
any one or more of the OBLIGATIONS OF PARTNERS TO THIRD
partners with the consent of PERSONS
all the partners whose
interests are not so charged LIABILITY FOR CONTRACTUAL OBLIGATIONS
or sold.
▪ Partnership shall be principally liable
CONVEYANCE OF PARTNER’S INTEREST for partnership obligations (Reason:
partnership’s separate legal
Effects of conveyance by a partner of his personality)
interest in the partnership: ▪ Partnership also liable for acts of the
▪ Conveyance of his whole partners in the following:
interest – partnership may ▪ Acts for apparently carrying
either remain or be dissolved on the usual way the business
▪ Assignee does not necessarily of the partnership (Art. 1818)
become a partner ▪ Acts of strict dominion or
▪ Assignee cannot interfere in ownership when authorized
the management or (Art. 1819)
charges.
Page 92 of 117
▪ Acts in contravention of the the partners cease to carry on the
authority granted but the business together.
third person has actual or ▪ Winding up is the process of settling
presumptive knowledge of business affairs after dissolution. (Ex:
the restrictions (Art. 1818) paying previous obligations,
▪ Personal and subsidiary liability of collecting assets previously
partners demandable, even new business if
▪ All partners, including needed to wind up)
industrial ones, shall be liable ▪ Termination is the point in time after
pro rata with all their all the partnership affairs have been
property and after all the wound up. (Idos vs. Court of Appeals,
partnership assets have been G.R. No. 110782, September 25,
exhausted (Art. 1816, CC) 1998)
▪ Any stipulation exempting a
partner from personal liability CAUSES OF DISSOLUTION
shall be void, except as
among the partners (Art. ▪ Those without violating the
1817, CC) agreement between the partners;
▪ Ex. Retirement, termination
SOLIDARY LIABILITY OF PARTNERSHIP AND of the fixed term, and other
PARTNERS stipulations
▪ In contravention of the agreement
▪ Where, by any wrongful act or between the partners, by the express
omission of any partner acting in the will of any partner at any time;
ordinary course of business of the ▪ By any event which makes it
partnership or with authority of his unlawful for the business of
co-partners, loss or injury is caused the partnership to be carried
to any person, not being a partner in on or for the members to
the partnership (Art. 1822) carry it on in partnership; (Ex:
▪ Where, one partner, acting within Prohibition against a
the scope of his authority, receives partnership to operate a
money or property of a third person fishpond [Deluao vs. Casteel,
and misapplies it (Art. 1823) L-21906, August 29, 1969])
▪ Where, the partnership, in the ▪ When a specific thing, which
course of its business, receives a partner had promised to
money or property and it is contribute to the partnership,
misapplied by any partner while it is perishes before the delivery,
in the custody of the partnership or when the thing, the
(Art. 1823) enjoyment or use of which
was transferred to the
DISSOLUTION partnership, is lost;
▪ When a specific thing, which
DISTINCTIONS BETWEEN DISSOLUTION, a partner had promised to
WINDING UP AND TERMINATION contribute to the partnership,
perishes before the delivery,
▪ Dissolution is the change in the or when the thing, the
relation of the partners caused by enjoyment or use of which
any partner ceasing to be associated was transferred to the
in the carrying on of the business. partnership, is lost;
(Art. 1828, CC) It is that point of time ▪ By the death of any partner;
charges.
Page 93 of 117
▪By the insolvency of any ▪ BUT, the partnership
partner or of the partnership; is not bound by any
▪ By the civil interdiction of the act of the partner
partner; where (a) the
▪ By the decree of court in the partnership is
situations provided under dissolved because it is
Art. 1831, CC. (insanity, fraud, unlawful to carry on
breach of the terms of the the business, (2) the
partnership, etc) partner has become
EFFECTS OF DISSOLUTION insolvent, (3) the
partner has no
▪ It terminates all authority of authority to wind up
any partner to act for the partnership affairs,
partnership. (Art. 1832, CC) unless, (a) the third
▪ Each partner is liable to his person had extended
co-partners for his share of credit prior to the
any liability created by any dissolution and he
partner not knowing of the had no knowledge of
cause of the dissolution. (Art. said dissolution, or (b)
1833, CC) the third person had
▪ A partner, however, can bind extended credit to the
the partnership by: partnership after the
▪ Any act appropriate dissolution but he had
for winding up no knowledge of said
partnership affairs or dissolution and the
completing fact of said dissolution
transactions was not advertised in
unfinished at a newspaper of
dissolution; general circulation.
▪ Any transaction which (Art. 1834, CC)
would bind the ▪ The dissolution of the
partnership if a third partnership does not of itself
person had extended discharge the existing liability
credit to the of any partner. He can only
partnership prior to be discharged by an
the dissolution and agreement to that effect
had no knowledge of between himself, the
said dissolution, or partnership creditor and the
had extended credit person or partnership
to the partnership continuing the business. (Art.
after the dissolution 1835, CC)
but he had no
knowledge of said RIGHTS OF A PARTNER UPON DISSOLUTION
dissolution and the
fact of said dissolution ▪ Right to wind up partnership affairs
was not advertised in (Art. 1836, CC)
a newspaper of ▪ Right to apply the partnership
general circulation. property to discharge its liabilities,
(Art. 1834, CC) and to apply the surplus to pay in
cash the net amount owing to the
charges.
Page 94 of 117
respective partners (Art. 1837, first ▪ Those owing to partners
par., CC) other than for capital and
▪ Right to damages in case of breach of profits
the agreement (Art. 1837, second ▪ Those owing to partners in
par., (1) (b), CC) respect of capital
▪ Right to be paid in cash his net ▪ Those owing to partners in
interest only (less any damage respect of profits
caused to his copartners), if he is the ▪ After the exhaustion of the
partner who caused the dissolution partnership property, the partners
wrongfully, and the partnership shall contribute pro rata with their
business is continued by the other own property.
partners (Art. 1837, second par., (3)
(b), CC)
▪ The partner who has a right to LIMITED PARTNERSHIP
rescind the contract on the ground of
fraud or misrepresentation of one of WHAT IS A LIMITED PARTNERSHIP?
the parties thereto has the right of
lien or retention of surplus of the Limited partnership is one formed by
partnership property, or to be two or more persons, having as members
subrogated to the rights of the one or more general partners and one or
partnership creditors whom he has more limited partners. (Art. 1843, CC)
paid, or to be indemnified by the ❑ The agreement must be in writing;
person guilty of fraud or ❑ It must be recorded with the
misrepresentation against all debts Securities and Exchange Commission.
and liabilities of the partnership. (Art. ❑ Note: Substantial compliance is
1838, CC) enough
▪ Note:
▪ A share in a partnership can Characteristics of a Limited Partnership
be returned only after the ❑ It is limited as to liability
completion of the latter's because:
dissolution, liquidation and ❑ The limited partner is
winding up of the business. liable only up to his
(Villareal vs. Ramirez, G.R. contribution; he is not
No. 144214, July 14, 2003) liable with his own
property to answer
MANNER OF WINDING UP for the obligations of
the partnership. (Art.
▪ The assets of the partnership are: 1843, second par., CC)
▪ The partnership property; ❑ He is not a proper
and party to proceedings
▪ The contributions of the by or against a
partners necessary for the partnership, except
payment of liabilities • where the action is to
▪ The assets shall be applied in enforce his right
this particular order. against or liability to
▪ Order of Preference of Liabilities of the partnership. (Art.
the Partnership: 1866, CC)
▪ Those owing to creditors ❑ It is limited in the
other than partners management. Only general
partners can participate in
the management of the
charges.
Page 95 of 117
partnership. If a limited SUB-LIMITED PARTNER VS. SUB-PARTNER
partner takes part in the
control of the business, he ▪ A sub-limited partner is a person
becomes liable as a general admitted to all the rights of a limited
partner. (Art. 1848, CC) partner who has died or has assigned
❑ It is limited as to the choice of his interest in a partnership.
contribution. A limited partner may ▪ A sub-partner merely shares in the
contribute cash or property, but not profits of the partner to which he is
services. (Art. 1845, CC) associated with.
❑ It is limited in the matter of firm
name. The surname of a limited
partner shall not appear in the
partnership name, unless: (1) it is
also the surname of a general NOTES ON AGENCY
partner, or (2) prior to the time when
the limited partner became such, the Agency
business has been carried on under
the name in which his surname • By a contract of agency, a person
appeared. A limited partner whose binds himself to render some service
surname appears in a partnership or to do something in representation
name contrary to this provision shall or on behalf of another, with the
be liable as a general partner. (Art. consent or authority of the latter.
1846, CC) (Art. 1868, CC)
RIGHTS OF A LIMITED PARTNER • Elements:

• The parties’ consent, express
▪ Inspection of the partnership books or implied, to establish the
(Art. 1851, CC) relationship;
▪ True and full information and formal • The object, which is the
accounting of partnership affairs execution of a juridical act in
(Ibid) relation to a third person;
▪ To demand dissolution and winding • The representation, by which
up by decree of court (Ibid) the one who acts as an agent
▪ To receive his share of the profits, does so, not for himself, but
and to demand the return of his as a representative;
contribution (Ibid) • The limitation that the agent
▪ To receive a pro rata share of the acts within the scope of his or
partnership assets should he loan her authority.
money or transact business with the
partnership (Art. 1854, CC) Characteristics of Agency
LIABILITIES/OBLIGATIONS OF A LIMITED • Consensual, because it is based on

PARTNER (Art. 1858, CC) the agreement of the parties which is
perfected by mere consent;
▪ To pay or deliver the contribution he
agreed to in the Certificate of Limited • Principal, because it can stand by
Partnership itself without need of another
▪ To hold in trust specific property or contract;
money which are to be contributed
or delivered to the partnership • Nominate, because it has its own
name;
charges.
Page 96 of 117
person alleging it. (Tuazon vs. Ramos,
• Unilateral, if it is gratuitous because G.R. No. 156262, July 14, 2005)
it creates obligations for only one of • The well-settled rule is that a person
the parties, i.e., the agent; or dealing with an assumed agent is
bilateral, if it is for compensation bound to ascertain not only the fact
because it gives rise to reciprocal of agency but also the nature and
rights and obligations; and extent of the agent's authority.
(Bautista-Spille vs. Nicorp
• Preparatory, because it is entered Management. G.R. No. 214057,
into as a means to an end, i.e., the October 19, 2015)
creation of other transactions or • Under Art. 1902, CC, A third person
contracts. with whom the agent wishes to
contract on behalf of the principal
When Agency is Presumed may require the presentation of the
power of attorney, or the
• Under the doctrine of apparent instructions as regards the agency.
authority or agency by estoppel
• The principal is bound by the Is there a required Form for Agency?
acts of his agent with the
apparent authority which he • As a general rule, no. Contracts shall
knowingly permits the agent be obligatory, in whatever form they
to assume, or which he holds may have been entered into,
the agent out to the public as provided all the essential requisites
possessing. The question in for their validity are present. (Art.
every case is whether the 1356, CC)
principal has by his voluntary • Exceptions:
act placed the agent in such a • The power to administer
situation that a person of property must be in a public
ordinary prudence, instrument (Art. 1358, CC)
conversant with business • The authority to sell land or
usages and the nature of the any interest therein must be
particular business, is in writing (Art. 1874, CC)
justified in presuming that
such agent has authority to Agent can Exercise both Express and
perform the particular act in Incidental Powers
question. (Professional
Services Inc. vs. Agana, G.R. It is a fundamental principle in the law of
No. 126297, January 31, agency that every delegation of authority,
2007) whether general or special, carries with it,
• Section 21, Rule 138, ROC (Authority unless the contrary be expressed, implied
of Attorney to Appear) authority to do all of those acts, naturally
and ordinarily done in such cases, which are
When Agency is not Presumed reasonably necessary and proper to be done
in order to carry into effect the main
• The declarations of agents alone are authority conferred. (Citibank, N.A. vs. Chua,
generally insufficient to establish the G.R. No. 102300, March 17, 1993)
fact or extent of their authority. The
law makes no presumption of Kinds of Agency
agency; proving its existence, nature
and extent is incumbent upon the • Express Agency – one where the
agent has been expressly authorized
charges.
Page 97 of 117
by the principal, either orally or in • It gives an agent the ability to act on
writing. a person’s behalf in all of his/her
• Implied Agency affairs.
• From the acts of the agent • Agency couched in general terms
which carry out the agency comprises only acts of
(Art. 1870, CC) administration, even if the principal
• From his silence or inaction should state that he withholds no
according to the power or that the agent may execute
circumstances (Ibid) - such acts as he may consider
Applicable only between appropriate, or even though the
persons who are present agency should authorize a general
• If the principal deliver his and unlimited management. (Art.
power of attorney to the 1877, CC)
agent and the latter receives • Acts of administration, as opposed to
it without any objection (Art. acts of ownership, pertain solely to
1871, CC) management or superintendence.
• Between persons who are absent: They do not necessarily pivot on
• When the principal ownership. (United BF Homeowners
• transmits his power of vs. Barangay Chairman of BF Homes,
attorney to the agent, G.R. No. 140092, September 8, 2006)
who receives it
without any Special Agency/Special Power of Attorney
objection;
• When the principal • It grants an agent authority only in
entrusts to him by specific situations.
letter or telegram a • A special power of attorney is
power of attorney required in the following cases:
with respect to the • To make such payments as
business in which he is are not usually considered as
habitually engaged as acts of administration;
an agent, and he did • To effect novations which put
not reply to the letter an end to obligations already
or telegram. (Art. in existence at the time the
1872, CC) agency was constituted;
• To compromise, to submit
Agency by Operation of Law questions to arbitration, to
renounce the right to appeal
 When a person declines the agency from a judgment, to waive
and no new agent has been objections to the venue of an
appointed action or to abandon a
 Immediately after the agent prescription already
withdraws from the agency acquired;
 In case of extinguishment of the • To waive any obligation gratuitously;
agency, without the knowledge of • To enter into any contract which the
the agent ownership of an immovable is
 In case of death of the agent transmitted or acquired either
gratuitously or for a valuable
General Agency/General Power of Attorney consideration;
• To make gifts, except customary ones
for charity or those made to
charges.
Page 98 of 117
employees in the business managed • To act in accordance with the
by the agent; instructions of the principal (Art.
• To loan or borrow money, unless the 1887, CC)
latter act be urgent and • To advance the necessary funds if
indispensable for the preservation of such is stipulated (Art. 1886, CC)
the things which are under • To render an account of his
administration; transactions and to deliver whatever
• To lease any real property to another he may have received by virtue of the
person for more than one year; agency (Art. 1891, CC)
• To bind the principal to render some • To pay damages to the principal for
service without compensation; his non-performance and for
• To bind the principal in a contract of engaging in conflict of interest (Art.
partnership; 1884, 1889, CC)
• To obligate the principal as a • To answer for his fraud and
guarantor or surety; negligence (Art. 1909, CC)
• To create or convey real rights over
immovable property; Rights of the Principal
• To accept or repudiate an
inheritance; • Right of control over the agent. (Art.
• To ratify or recognize obligations 1887, 1888, CC)
contracted before the agency; • To be paid damages if, there being
• Any other act of strict dominion. conflict between the interests of the
• The requirement of a special power principal and those of the agent, the
of attorney refers to the nature of agent should prefer his own (Art.
the authorization and not to its form. 1889, CC), or if the agent is guilty of
If the special authority is not written, fraud or negligence. (Art. 1909, CC)
then it must be duly established by • Right to an accounting by the agent
evidence. (Gozun vs. Mercado, G.R. of his transactions and to the delivery
No. 167812, December 19, 2006, of whatever the agent may have
received by virtue of the agency. (Art.
citing Lim Pin Lao vs. Liano Tian, 200
1891, CC)
Phil 685 [1982])
RIGHTS AND OBLIGATIONS OF THE Obligations of the Principal
PARTIES
• To pay the agent his compensation,
Rights of the Agent unless the contrary was agreed upon.
• Right to be compensated (Art. 1875, (Art. 1875, CC)
CC) • To comply with the obligations which
• Right to appoint a substitute (Art. the agent may have contracted
1892, CC) within the scope of his authority, or
• Right to be reimbursed the sums those which the agent has done
advanced by him for the execution of outside the scope of his authority but
the agency (Art. 1912, CC) which the principal has ratified, or
when the principal allowed the agent
Obligations of the Agent to act as though he had full powers.
(Art. 1910, 1911, CC)
• To carry out the agency and finish the • To advance to, or reimburse, the
business (Art. 1884, CC) agent, the sums necessary for the
execution of the agency, or the
damages which the execution of the
agency has caused the agent,
charges.
Page 99 of 117
without fault or negligence on his • The latter acts within the scope of his
part. (Art. 1912, 1913, CC) authority but in his own name,
except when the transaction involves
But the principal is not liable for the things belonging to the principal.
expenses incurred by the agent in the
following cases: When Agent may incur Personal Liability
• If the agent acted in
• When the agent expressly binds
contravention of the
himself;
principal's
• When the agent exceeds his
instructions, unless
authority;
the latter should wish
• When an agent by his act prevents
to avail himself of the
performance on the part of the
benefits derived from
principal;
the contract;
• When a person acts as an agent
• When the expenses
without authority or without a
were due to the fault
principal;
of the agent;
• A person who purports to act as
• When the agent
agent of an incapacitated principal.
incurred them with
knowledge that an
Modes of Extinguishment of Agency
unfavorable result
• By its revocation;
would ensue, if the
• By the withdrawal of the agent;
principal was not
• By the death, civil interdiction,
aware thereof;
insanity or insolvency of the principal
• When it was
or of the agent;
stipulated that the
• By the dissolution of the firm or
expenses would be
corporation which entrusted or
borne by the agent, or
accepted the agency;
that the latter would
• By the accomplishment of the object
be allowed only a
or purpose of the agency; and
certain sum. (Art.
• By the expiration of the period for
1918, CC)
which the agency was constituted
When Principal bound by act of Agent
Kinds of Revocation
• The agent must act within the scope
• Express
of his authority; and
• Implied
• The agent must be act in behalf of the
• When the principal appoints a
principal.
new agent for the same
• In addition:
business or transaction (Art.
• Doctrine of Imputed
1923); or
Knowledge
• When the principal directly
• Ratification
manages the business
• Estoppel
entrusted to the agent. (Art.
1924)
When Principal not bound by act of Agent
• When the principal after
granting a general power of
• The latter acts without or beyond the
attorney to an agent, grants a
scope of his authority in the former’s
special one to another agent,
name; and
there is implied revocation of
charges.
Page 100 of 117
the former as regards the
special matter involved in the Parties to a Loan
latter. (Art. 1926)
 Bailor – the giver; the party who
Irrevocable Agency delivers possession/custody of the
thing bailed; the lender
• If a bilateral contract depends upon it  Bailee – the recipient; the party who
• If it is the means of fulfilling an receives the possession/custody of
obligation already contracted; and the thing delivered; the borrower
• If a partner is appointed manager of
a partnership in the contract of Types of Loan
partnership and his removal from
management is unjustifiable. • Commodatum
• Mutuum
Right of the Agent to Withdraw • Distinctions:
• In commodatum, it ordinarily
• With or without just cause involves something not
• He must continue to act until the consumable; in mutuum, it
principal has had reasonable includes money or other
opportunity to take the necessary consumable thing.
steps to meet the situation. (Art. • In commodatum, the
1929) ownership of the thing loaned
is retained by the lender; in
When Death of Principal does not Terminate mutuum, the ownership is
Agency transferred to the borrower.
• Commodatum is essentially
• If the agency has been constituted in gratuitous;
the common interest of the principal mutuum may be gratuitous or may be
and the agent; and onerous, i.e., with stipulated interest.
• If it has been constituted in the • In commodatum, borrower
interest of a third person who has must return the same thing
accepted the stipulation in his favor, loaned; in mutuum, the
(Art 1930) borrower need only pay the
equivalent of the thing, that
NOTES ON LOANS is, the same amount of the
same kind and quality.
What is a Loan? • Commodatum may involve
both real or personal
• It is a contract whereby one of the property; mutuum refers only
parties delivers to another, either to personal property.
something not consumable so that • In commodatum, loan is for
the latter may use the same for a use or temporary possession;
certain time and return it, in which in mutuum, loan is for
case the contract is called a consumption.
commodatum; or money or other
consumable thing, upon the What are consumable,
condition that the same amount of non-consumable, fungible
the same kind and quality shall be and non-fungible things?
paid, in which case the contract is
simply called a loan or mutuum. (Art. • Consumable thing – a thing that
1933, CC) cannot be used in a manner
charges.
Page 101 of 117
appropriate to its nature without • The death of either
being consumed. the bailor or the
• Non-consumable thing – a thing that bailee extinguishes
can be used in a manner appropriate the contract;
to its nature without it being • The bailee can neither
consumed. lend nor lease the
• Fungible thing – one where the object of the contract
parties have agreed to allow the to a third person.
substitution of the thing given or However, the
delivered with an equivalent thing. members of the
• Non-Fungible thing – one where the bailee’s household
parties have the intention of having may make use of the
the same identical thing returned thing loaned, unless
after the intended use. there is a stipulation
to the contrary, or
Important! unless the nature of
the thing forbids such
• A loan, whether commodatum or use.
mutuum, is a real contract. It is
perfected only from the time the Obligations of the Bailee
object of the contract is delivered.
(Art. 1934, CC) • To pay ordinary expenses for the use
• Q: Is an accepted promise to and preservation of the thing
loan a thing actionable? loaned.
• A: Yes. The accepted promise • To take good care of the thing with
to deliver something by way the diligence of a good father of a
of a future loan becomes a family.
consensual contract. Its non- • To be liable for loss, even if through a
fulfillment will justify the fortuitous event when:
filing of an action for • He devotes the thing to any
damages. purpose different from that
which it has been loaned;
Notes on Commodatum
• the thing loaned has been
• # 1. It is gratuitous or without delivered with appraisal of its
compensation. value, UNLESS there is a
• Otherwise, the contract stipulation exempting the
becomes a lease of things. bailee from responsibility in
• #2. Generally, the bailee does not case of fortuitous event;
enjoy the fruits. • He lends or leases the thing to
• Otherwise, the contract is a a third person who is not a
usufruct. member of his household;
• But, a contrary stipulation is and
valid. (Art. 1940, CC) • Being able to save the thing
• #3. The bailor lender need not be the borrowed or his own thing, he
owner. chose to save the latter.
• Ex. A lessee of a thing may • He keeps it longer than the
lend it to another period stipulated or after the
• #4. Commodatum is purely personal. accomplishment of the use
• Effects: for which the commodatum
has been constituted;
• To return the thing
charges.
Page 102 of 117
• Bailee cannot retain the thing • A loan is a debt, not a trust.
except for damages by reason • Sec. 20, Art. III of the
of hidden defects or flaws of Constitution prohibits
the thing loaned imprisonment for non-
payment of a debt
Obligations of the Bailor • #2. The object of mutuum is a
fungible thing
• To respect the right of the bailee to • Fungible things are not to be
use the thing returned but substituted or
• Bailor may demand the replaced with the equivalent
return of the thing if: of the thing, meaning another
• Expiration of the thing of the same kind,
period stipulated; quality and quantity
• Accomplishment of • # 3. No interest shall be due unless it
the use for which the is stipulated in writing
commodatum was • Usurious loans presuppose
constituted; the imposition of an interest
• If the bailor should for more than or in excess of
have urgent need for what is fair and reasonable.
the thing, he may • Although the usury law has
demand the return or been repealed, the courts can
temporary use reduce unreasonable and
thereof; unconscionable interest
• If the bailee • If the borrower pays interest
committed an act of when there is no stipulation
ingratitude therefor, solutio indebiti or
• Precarium - a kind of natural obligations shall
commodatum where apply.
the bailor may • One who has allowed another to
demand the thing at assume apparent ownership of
will. personal property for the purpose of
• To refund ordinary expenses making any transfer of it, cannot, if
incurred by the bailee he received the sum for which a
• To pay damages to the bailee for pledge has been constituted, set up
injury suffered by reason of the flaws his own title to defeat the pledge of
of hidden defects of the thing loaned the property, made by the other to a
• This applies only when the pledgee who received the same in
bailor was aware of the good faith and for value. (Art. 1438,
defects. In commodatum, CC)
there is no implied warranty
against hidden defects MONETARY VS. COMPENSATORY INTEREST
Notes on Mutuum • Monetary interest is the

compensation fixed by the parties for
• # 1. Ownership is transferred in the use or forbearance of money. On
mutuum the other hand, compensatory
• The purpose is consumption interest is that imposed by law or by
• The obligation of the the courts as penalty or indemnity for
borrower is to pay (not damages. Accordingly, the right to
return) the equivalent of the recover interest arises only either by
thing virtue of a contract (monetary
charges.
Page 103 of 117
interest) or as damages for delay or allowed to use
failure to pay the principal loan on the thing if the
which the interest is demanded safekeeping is
(compensatory interest). still the
• The aforesaid monetary interest shall principal
itself earn compensatory interest at purpose of the
the prevailing legal rates, pursuant to contract (Art.
Article 2212 of the Civil Code, which 1978, CC)
states that …
• '[i]nterest due shall earn legal Types of deposit:
interest from the time it is judicially
demanded, although the obligation o Judicial
may be silent upon this point.' To be o Extrajudicial
sure, [the foregoing provision] ▪ Voluntary
contemplates the presence of ▪ Necessary
stipulated or conventional  Other “deposits”
interest, i.e., monetary interest, o Bank deposits – are actually in
which has accrued when demand the nature of a loan (Art.
was judicially made." In contrast, 1980, CC)
Article 2212 of the Civil Code finds no o Safety deposit boxes – special
application if there was no type of deposit with features
stipulated/monetary interest agreed similar to rent or lease
upon by the parties which could (General Banking Act)
further earn compensatory interest.
(Uysipuo vs. RCBC, G.R. No. 248898, Judicial Deposit
September 7, 2020)
➢ Judicial deposit or sequestration
NOTES ON DEPOSIT takes place when an attachment or
seizure of property in litigation is
What is a Deposit? ordered by a court.
➢ Obligations of depositary (appointed
It is a contract whereby a person (depositor) by the Court):
delivers a thing to another (depositary), for to take care of the property
the principal purpose of safekeeping it, with with the diligence of a good
the obligation of returning it when father of a family
demanded. (Art. 1962, CC) cannot be relieved of his
responsibility until the
Characteristics of Deposit: litigation is ended or the court
so orders
o It is a real contract ➢ The Rules of Court apply on matter
o Only movables or personal not covered by the Code.
property can be the object of
a deposit. Exception: judicial Voluntary Deposit
deposit
o It is intended for the • Voluntary deposit is that wherein the
safekeeping of the thing delivery is made by the will of the
o It is generally gratuitous depositor.
o Generally, the depositary • Characteristics:
cannot use the thing o Generally, the depositor
• The depositary must be the owner of the
may be thing deposited.
charges.
Page 104 of 117
o The depositary cannot changing the way of the
dispute the title of the deposit
depositor to the thing o To collect principal and
deposited interests on certificates,
o Valid even if the depositor is bonds, securities or
legally incapacitated. The investments when they fall
contract is merely voidable. due
▪ If the depositary is the o Not to use the thing without
party incapacitated, the express permission of the
the depositor shall depositor
only have the right to o To notify the true owner of
recover the thing the thing (if he is known) if
while it is in the the thing deposited was
possession of the discovered to be stolen by the
depositary. Third depositor
persons in good faith ▪ If the depositor insists
are protected. on his ownership, the
depositary may file an
Obligations of the Depositary action for
interpleader
o To keep the things safely (to o To spend for the expenses of
take care of the thing) preservation of the thing
• (Art. 1163, CC) deposited if the deposit is
o To return the thing deposited with compensation
(Art. 1988, CC)
▪ To return the thing in Obligations of the Depositor
the same condition if
the thing was • To reimburse the depositary for
delivered closed and expenses for preservation (if deposit
sealed (Art. 1981, CC) is gratuitous)
▪ He may retain the • To pay the depositary his
thing in pledge until compensation (if deposit is with
the full payment of compensation)
what may be due him • To indemnify the depositary for
by reason of the loss caused by the character of
deposit the thing
o To be liable for loss even if
due to fortuitous event: Extinguishment of Voluntary Deposit
▪ If it is so stipulated;
▪ If he uses the thing o Loss or destruction of the
without the thing
depositor’s o In case of gratuitous deposit,
permission; upon the death of either
▪ If he delays its return; party
▪ If he allows others to o Other causes:
use it. ▪ Expiration of the
period
o Not to deposit the thing with ▪ Demand at the will of
a third person the depositor
o To notify the depositor and ▪ Mutual withdrawal
get his permission before from the contract
charges.
Page 105 of 117
▪ Fulfillment of the o The cause is the character of
purpose of the the thing
deposit
▪ Fulfillment of the Rule on Posting of Exculpatory Notices
resolutory condition
o They cannot free the hotel-
Necessary Deposit keeper from responsibility.
Any stipulation suppressing
• A deposit is necessary when: or diminishing the liability of
o When it is made in the hotel-keeper shall be
compliance with a legal void. (Art.. 2003, CC)
obligation, e.g. custodia legis
o When it takes place on the Hotel-keeper’s Right of Retention
occasion of any calamity such
as fire, storm, flood, pillage, o The hotel-keeper has a right
shipwreck or other similar to retain the things brought
events into the hotel by the guest, as
o The deposit made by a security for credits on
travelers in hotels or inns account of lodging, and
shall also be regarded as supplies usually furnished to
necessary (Art. 1998) hotel guests. In addition,
• For hotel-keepers to be liable as non-payment constitutes
depositaries, the following elements estafa.
must concur: (Art. 1998, CC) NOTES ON GUARANTY
o They have been previously
informed about the effects Guaranty
brought by the guests; and
o The latter have taken the It is a contract where a person, called the
precautions prescribed guarantor, binds himself to another, called
regarding their safekeeping the creditor, to fulfill the obligation of the
• Extended liability: includes vehicles, principal debtor in case the latter should fail
animals and articles introduced or to do so (Art. 2047, CC)
placed in the annexes of the hotel
(Art. 1999, CC) Characteristics of Guaranty
• When hotel-keeper liable: (Art. 2000, • Consensual – can be perfected by

CC) mere consent. There is no
o The loss or injury is caused by requirement of delivery of the object
his servants or employees; of the contract.
o The loss or injury is caused by • Accessory—because it is dependent
strangers; for its existence upon the principal
obligation guaranteed by it
When hotel-keeper not liable: (Art. 2000- • Subsidiary and conditional—
2002, CC) it takes effect only when the
o The cause is force majeure principal debtor fails in his obligation
o The cause is robbery with use subject to limitation
of firearm or through • Unilateral – only the guarantor has
irresistible force the obligation to indemnify the
o The cause is the act or acts of creditor in case of failure of the
the guest principal debtor to perform his
prestation
charges.
Page 106 of 117
committed to answer for the
Suretyship principal obligation of the debtor
• Conventional guaranty – by
• It is an agreement where a party, agreement
called the surety, guarantees the • Legal guaranty – required by law
performance by another party called • Judicial guaranty – ordered by the
the principal or obligor of an court, ex. Supersedeas bond
obligation or undertaking in favor of • Gratuitous – the guarantor does not
a third person called the obligee. receive compensation
• A surety's liability is joint and several, • Onerous – the guarantor is paid a
limited to the amount of the bond, valuable consideration for his
and determined strictly by the terms guaranty
of contract of suretyship in relation • Definite – the guaranty is limited to
to the principal contract between the the principal obligation
obligor and the obligee. • Indefinite – comprises not only the
principal but also its accessories and
Guaranty and Surety costs
• They are similar because both Effect of Guaranty without Consent of the
promise or undertake to answer for Debtor
the debt, default or miscarriage of
another person • The guarantor may recover from the
debtor what he paid to the creditor
but only to the extent of the benefit
• Distinctions: enjoyed by the debtor
• The liability of a guarantor depends • To prevent unjust enrichment
upon an independent agreement to • But note:
pay the obligation of the principal if o If the guarantor should pay
he fails to do so; the surety assumes without notifying the debtor,
liability as a regular party to the the latter may enforce
contract against him all the defenses
• A guarantor’s obligation is available against the creditor
secondary; a surety’s obligation is (Art. 2068, CC)
primary o If the debt was for a period
• A guarantor’s undertaking is to pay if and the guarantor paid it
the principal debtor cannot pay; a before it became due, he
surety’s undertaking is to pay if the cannot demand
principal debtor does not pay reimbursement until the
• A guarantor is an insurer of the expiration of the period (Art.
solvency of the principal debtor; a 2069, CC)
surety is an insurer of a debt o If the guarantor paid without
• A guarantor is entitled to the benefit notifying the debtor and the
of excussion; a surety is not debtor repeats the payment,
the guarantor can only collect
Kinds of Guaranty from the creditor (Art. 2070,
CC)
• Personal guaranty – where an
individual personally assumes the Effect of Guaranty with Consent of the
fulfillment of the principal obligation Debtor
• Real guaranty – where a property
(immovable or movable) is formally
charges.
Page 107 of 117
 The guarantor is subrogated to all the
rights which the creditor may have  A guaranty is not presumed; it must
against the debtor be express and cannot extend to
 This results by operation of law from more than what is stipulated therein
the act of payment and there is no (Art. 2055, CC).
necessity for the guarantor to ask the  To be enforceable, the contract must
creditor to expressly assign his rights be expressed and in writing.
of action Reason: Art. 1403, par. 2 (b). A guaranty is a
 The obligation of the debtor subsists. special promise to answer for the debt,
There is just a change in the person default or miscarriage of another.
of the creditor of the principal debtor
Qualifications of a Guarantor
What can be the subject of Guaranty?
 He must be a person of integrity;
 A valid obligation between a debtor  He has full legal capacity;
and a creditor  He has sufficient property to answer
 It may also be constituted to for the obligation of the debtor.
guarantee:  A creditor may demand a substitute
 Voidable obligation guarantor:
 Unenforceable obligation  When the original guarantor
Conditional obligations is convicted of a crime
involving dishonesty, like
What is a Continuing Guaranty estafa and misappropriation
 It covers all transactions, including When the original guarantor becomes
those arising in the future. insolvent
 Future debts may be secured by a The Benefit of Excussion
guarantee even if the exact amount
is not yet known. However, the • Under the benefit of excussion, the
guarantor cannot be sued until the creditor has to resort to the
debt is liquidated, which means that properties first of the debtor. The
the amount of the debt is already guarantor cannot be compelled to
determined or fixed. pay the creditor unless the latter has
exhausted all the properties of the
Limit of Guarantor’s Liability debtor, and has resorted to all the
legal remedies against the debtor.
 It cannot go beyond the obligation of (Art. 2088, Civil Code)
the principal debtor because the • Requisites:
contract of guaranty is merely o The guarantor must set up
accessory. the right against the creditor
 The limitation on the liability of the upon the latter’s demand for
guarantor applies both to the (a) payment from him;
amount and (b) onerous character of ▪ This means that a final
the obligation. judgment must have
 Q: What is the legality of a been rendered
guaranty which exceeds the previously against the
principal obligation? debtor and it was not
A: The guaranty is not rendered void. The satisfied.
same shall be reduced to the extent or limit o The guarantor must point out
of the debtor’s obligation. to the creditor the available
property of the debtor
Form of the Contract of Guaranty
charges.
Page 108 of 117
When the Benefit of Excussion is not • In the following situations, the
Available guarantor can obtain release or
demand security to protect him:
• If the guarantor has expressly o When he is sued for payment;
renounced it; o In case of insolvency of the
• If he has bound himself solidarily principal debtor;
with the debtor; o When the debtor has bound
• In case of insolvency of the debtor; himself to relieve him from
• When he has absconded, or cannot the guaranty within a
be sued within the Philippines, unless specified period, and this
he has left a manager or period has expired;
representative; o When the debt has become
• If it may be presumed that an demandable by reason of the
execution on the property of the expiration of the period of
principal debtor would not result in payment;
the satisfaction of the obligation. o After the lapse of ten years,
when the principal obligation
• The Benefit of Division has no fixed period for its
maturity, unless it be of such
• Should there be several guarantors nature that it cannot be
of only one debtor and for the same extinguished except within a
debt, the obligation to answer for the period longer than ten years;
same is divided among all. o If the debtor intends to
• The liability of the guarantors is joint abscond;
and proportional. o If it is imminent that the
• The creditor can claim from the debtor will become insolvent
guarantors only the shares they are
respectively bound to pay, unless Extinguishment of Guaranty
solidarity was stipulated.
• Same grounds for extinguishing
The Benefit of Contribution obligations under Art. 1231, CC:
o Payment or performance;
• It applies when one guarantor has o Loss of the thing due;
paid the obligation of the principal o Condonation or remission of
debtor and is seeking contribution the debt;
from his co-guarantors. o Confusion or merger of the
• Note: rights of the creditor and
• The co-guarantors may set up against debtor;
the one who paid the same defenses o Compensation;
which would have pertained to the o Novation;
principal debtor against the creditor o Also:
▪ Annulment;
Guarantor’s Right against the Debtor ▪ Rescission
▪ Fulfillment of a
• Right to Indemnity resolutory condition;
o Total amount of the debt ▪ Prescription
o Legal interests • Other grounds:
o Expenses o Release by acceptance of
o Damages property by the creditor;
charges.
Page 109 of 117
o Release made by the creditor Requisites of an action based on abuse of
in favor of one of the right
guarantors;
o Extension of term granted by • There is a legal right or duty;
the creditor to the debtor • Which is exercised in bad faith;
without the consent of the • For the sole intent of prejudicing or
guarantor; injuring another
o When the guarantor, through
some act of the creditor, BREACH OF CONTRACT DONE
cannot be subrogated to the FRAUDULENTLY OR IN BAD FAITH
rights, mortgages and
preferences of the latter • When a party reneges on his or her
obligations arising from contracts in
NOTES ON TORTS and DAMAGES bad faith, the act is not only contrary
to morals, good customs, and public
STANDARDS OF GOOD HUMAN RELATIONS policy; it is also a violation of Article
1159. Breaches of contract become
• Every person must, in the exercise of the basis of moral damages, not only
his rights and in the performance of under Article 2220, but also under
his duties, act with justice, give Articles 19 and 20 in relation to
everyone his due, and observe Article 1159.
honesty and good faith. (Art. 19, CC) • Art. 2220 states that moral
• Every person who, contrary to law, damages may be awarded in
willfully or negligently causes case of breach of contract
damage to another, shall indemnify where the breach is due to
the latter for the same. (Art. 20, CC) fraud or bad faith.
• Any person who willfully causes loss • Art. 1159 states that
or injury to another in a manner that obligations arising from
is contrary to morals, good customs contracts have the force of
or public policy shall compensate the law between the contracting
latter for the damage. (Art. 21, CC) parties and should be
complied with in good faith.
What is abuse of right? Arco Pulp vs. Lim (ibid)
There is an abuse of right when it is exercised ACTS CONTRA BONUS MORES

for the purpose of prejudicing or injuring
another. When the objective of the actor is Source: Article 21, Civil Code
illegitimate, the illicit act cannot be “Any person who willfully causes loss
concealed under the guise of exercising a or injury to another in a manner that is
right. (Baron’s Marketing vs. Court of contrary to morals, good customs or public
Appeals, 286 SCRA 98 [1998]) policy shall compensate the latter for the
damage.”
The exercise of a right must be in Elements:
accordance with the purpose for which it • There is an act that is legal;
was established and must not be excessive • But is contrary to morals, good
or unduly harsh; there must be no intention custom, public order, or public
to harm another. Otherwise, liability for policy; and
damages to the injured party will attach. • It is done with intent to injure
(Ardiente vs. Spouses Pastorfide, G.R. No. Albenson Enterprises vs. Court of Appeals,
161921, July 17, 2013) G.R. No. 88694, January 11, 1993
charges.
Page 110 of 117
Quasi-delict or culpa aquiliana refers to obligor consists in the omission of
fault or negligence which results in damage that diligence which is required by
to another, there being no pre-existing the nature of the obligation and
contractual relation between the parties, corresponds with the circumstances
and is governed by Art. 2176, Civil Code. of the persons, of the time and of the
Torts, which is a much broader concept, place.
includes intentional and malicious acts and is • On the other hand, according to
covered by Articles 19, 20 and 21 of the Civil Article 365 of the Revised Penal
Code and by the Revised Penal Code. Code, reckless imprudence consists
in voluntarily, but without malice,
Requisites before a person may be liable doing or failing to do an act from
under quasi-delict: which material damage results by
• There must be an act or omission; reason of inexcusable lack of
• There must be damage or prejudice; precaution on the part of the person
• There must be causal relationship performing or failing to perform such
between the act or omission and the act, taking into consideration his
damage done; employment or occupation, degree
• There must be no pre-existing of intelligence, physical condition
contractual relationship between the and other circumstances regarding
parties. persons, time and place.
• A liability for tort may arise • The test of negligence is: Did the
even under a contract, where defendant in doing the alleged
tort is that which breaches negligent act use that reasonable
the contract. (Loadmasters care and caution which an ordinarily
vs. Glodel Brokerage, G.R. No. prudent person would have used in
179446, January 10, 2011) the same situation? If not, then he is
guilty of negligence. (Picart vs. Smith,
Classification of torts 37 Phil. 809 [1918])
• General Rule: The party relying on
• Intentional torts – Articles 20, 21 and negligence as his cause of action has
26 of the Civil Code the burden of proving the existence
• Negligent torts – any other act or of the same
omission where there is fault or • Exception: In the following instances,
negligence a presumption arises that the
• Strict liability – liability independent defendant was negligent:
of fault or negligence  If the driver was violating traffic rules
and regulations at the time of the
The Tortfeasor collision. (Kapalaran Bus Line vs.
Coronado, G.R. No. 85331, August
• Principal or sole tortfeasor – the 25, 1989)
person whose act or omission  Common carriers are presumed to
directly or principally causes the have been at fault or to have acted
injury or damage negligently if the goods are lost,
• Joint tortfeasor/s– the person or destroyed or deteriorated. (Bascos
persons whose negligence or vs. Court of Appeals, G.R. No. 101089,
concurrent and whose responsibility April 7, 1993)
is deemed solidary.  In case of death of or injuries to
passengers, the law presumes said
Negligence common carriers to be at fault or to
• According to Article 1173 of the Civil have acted negligently. (Pilapil vs.
Code, the fault or negligence of the
charges.
Page 111 of 117
Court of Appeals, G.R. No. 52159, Strict Liability
December 22, 1989)
Note: The law does not, however, • Possessor of animal
make the carrier an insurer of the absolute • The possessor of an animal or
safety of its passengers whoever may make use of the
 The finding of negligence on the part same is responsible for the
of the employee gives rise to the damage which it may cause,
presumption of negligence on the although it may escape or be
part of the employer in the selection lost. This responsibility shall
and supervision of the employee. cease only in case the damage
(Pantranco vs. Baesa, G.R. Nos. should come from force
79050-51, November 14, 1989) majeure or from the fault of
 In case of a forged indorsement of a the person who has suffered
check and the check was encashed, damage. (Art. 2183, Civil
the collecting bank is presumed Code)
negligent. Similarly, when the • Food manufacturers and processors
signature of the drawer is forged and, • Manufacturers and
for which reason, the check was processors of foodstuffs,
encashed, it is the drawee bank drinks, toilet articles and
which is presumed negligent. similar goods shall be liable
(Associated Bank vs. Court of for death or injuries caused
Appeals, G.R. No. 107382, January by any noxious or harmful
31, 1996) substances used, although no
contractual relation exists
Note! between them and the
consumers. (Art. 2187, Civil
Applying Art. 1734, CC, the common carrier Code)
is not presumed negligent if the loss, • Provinces, cities and municipalities
destruction or deterioration of the goods is • Provinces, cities and
due to any of the following causes: municipalities shall be liable
 Flood, storm, earthquake, lightning, for damages for the death of,
or other natural disaster or calamity; or injuries suffered by, any
 Act of the public enemy in war, person by reason of the
whether international or civil; defective condition of roads,
 Act or omission of the shipper or streets, bridges, public
owner of the goods; buildings, and other public
 The character of the goods or defects works under their control or
in the packing or in the containers; supervision. (Art. 2189, Civil
 Order or act of competent public Code)
authority • Proprietors of buildings
• The proprietor of a building or
Defenses in Negligence Cases: structure is responsible for
 Prescription the damages resulting from
 Fortuitous event its total or partial collapse, if
 Assumption of risk it should be due to the lack of
 Contributory negligence necessary repairs. (Art. 2190,
 Doctrine of Last Clear Chance Civil Code)
 Emergency Rule
 Involuntariness The Tortfeasor
 Accident
charges.
Page 112 of 117
• Direct tortfeasor – the person whose even though the former are not
act or omission directly or principally engaged in any business or industry.
causes the injury or damage • The State is responsible in like
• Persons made responsible for others manner when it acts through a
– the person who has responsibility special agent; but not when the
over the principal tortfeasor and is damage has been caused by the
held liable because he abetted, official to whom the task done
encouraged or promoted the act of properly pertains, in which case what
the latter, or because he failed to is provided in article 2176 shall be
exercise such degree of diligence in applicable.
order to prevent the injury or • Lastly, teachers or heads of
damage establishments of arts and trades
• Joint tortfeasor - where the shall be liable for damages caused by
concurrent or successive negligent their pupils and students or
acts or omissions of two or more apprentices, so long as they remain
persons, although acting in their custody.
independently, are in combination
the direct and proximate cause of a Proximate cause
single injury to a third person “Proximate cause is that cause, which, in
natural and continuous sequence, unbroken
Vicarious Liability by any efficient intervening cause, produces
Under the principle of vicarious liability the injury, and without which the result
under Art. 2180 of the Civil Code, the would not have occurred.”
obligation imposed by Article 2176 is - Vda de
demandable not only for one's own acts or Bataclan vs. Medina (101 Phil 181[1957])
omissions, but also for those of persons for
whom one is responsible. The activities or “A prior and remote cause cannot be made
situations where vicarious liability attaches the basis of an action if such remote cause
are as follows: did nothing more than furnish the condition
• The father and, in case of his death or give rise to the occasion by which the
or incapacity, the mother, are injury was made possible, if there intervened
responsible for the damages caused between such prior or remote cause and the
by the minor children who live in injury a distinct, successive, unrelated, and
their company. efficient cause of the injury, even though
• Guardians are liable for damages such injury would not have happened but for
caused by the minors or such condition or occasion. If no danger
incapacitated persons who are under existed in the condition except because of
their authority and live in their the independent cause, such condition was
company. not the proximate cause. And if an
• The owners and managers of an independent negligent act or defective
establishment or enterprise are condition sets into operation the
likewise responsible for damages circumstances which result in injury because
caused by their employees in the of the prior defective condition, such
service of the branches in which the subsequent act or condition is the proximate
latter are employed or on the cause.”
occasion of their functions. - Manila Electric Co.
• Employers shall be liable for the vs. Remoquillo (99 Phil 117[1950])
damages caused by their employees
and household helpers acting within “The doctrine of proximate cause is
the scope of their assigned tasks, applicable only in actions for quasi-delict,
not in actions involving breach of contract.
charges.
Page 113 of 117
The doctrine is a device for imputing liability
to a person where there is no relation • Attractive Nuisance
between him and another party. In such a “One who maintains on his premises
case, the obligation is created by law itself. dangerous instrumentalities or appliances of
But, where there is a pre-existing contractual a character likely to attract children in play,
relation between the parties, it is the parties and who fails to exercise ordinary care to
themselves who create the obligation, and prevent children from playing therewith or
the function of the law is merely to regulate resorting thereto, is liable to a child of tender
the relation thus created.” years who is injured thereby, even if the
- child is technically a trespasser in the
Calalas vs. CA, G.R. No. 122039, May 31, premises.”
2000 - Hidalgo
Enterprises vs. Balandan, 91 Phil 488 (1952)
“To be considered the proximate cause of
the injury, the negligence need not be the
event closest in time to the injury; a cause is • Last Clear Chance
still proximate, although farther in time in “Last clear chance is a doctrine in the law of
relation to the injury, if the happening of it torts which states that the contributory
set other foreseeable events into motion negligence of the party injured will not
resulting ultimately in the damage.” defeat the claim for damages if it is shown
- that the defendant might, by the exercise of
Abrogar vs. Cosmos Bottling Co., G.R. No. reasonable care and prudence, have avoided
164749, March 15, 2017 the consequences of the negligence of the
injured party. In such cases, the person who
• Emergency Rule had the last clear chance to avoid the mishap
“Under the ‘emergency rule’ an individual is considered in law solely responsible for
who suddenly finds himself in a situation of the consequences thereof.”
danger and is required to act without much - McKee vs.
time to consider the best means that may be IAC, G.R. No. 68102, July 16, 1992
adopted to avoid the impending danger, is
not guilty of negligence if he fails to • Contributory Negligence
undertake what subsequently and upon “Contributory negligence is conduct on the
reflection may appear to be a better part of the injured party, contributing as a
solution, unless the emergency was brought legal cause to the harm he has suffered,
by his own negligence.” which falls below the standard to which he is
- Valenzuela required to conform for his own protection.”
vs. CA, G.R. No. 115024, February 7, 1996 - Valenzuela
vs. CA, G.R. No. 115024, Feb. 7, 1996
• Res Ipsa Loquitor
“Where the thing which caused injury, • Caso Fortuito or Accident
without fault of the injured person, is under In invoking the exempting circumstance of
the exclusive control of the defendant and caso fortuito or accident, human agency
the injury is such as in the ordinary course of must be entirely excluded as the proximate
things does not occur if those having such cause or contributory cause of the injury or
control use proper care, it affords loss. In a vehicular accident, for example, a
reasonable evidence, in the absence of the mechanical defect will not release the
explanation that the injury arose from defendant from liability if it is shown that the
defendant's want of care. x x x This rule is accident could have been prevented had he
known by the name of res ipsa loquitor.” properly maintained and taken good care of
- Africa the vehicle.
vs. Caltex, L-12986, March 31, 1966
charges.
Page 114 of 117
- Perla Compania vs. Sps.
Sarangaya, G.R. No. 147746, October 25, • Moral damages are not intended to
2005. enrich a plaintiff at the expense of
the defendant. They are awarded
Damages only to allow the former to obtain
means, diversion, or amusements
• They are the recompense or that will serve to alleviate the moral
compensation awarded for the suffering he has undergone due to
damage suffered, that is, the loss, the defendant’s culpable action and
hurt or harm which results from the must, perforce, be proportional to
injury. (Far East Bank vs. Pacilan, Jr., the suffering inflicted. (PAL vs. Court
G.R. No. 157314, July 29, 2005) of Appeals, G.R. No. 120262, July 17,
1997)
Actual and Compensatory Damages
• A juridical person is not entitled to
• Actual or compensatory damages moral damages under Article 2217 of
cannot be presumed, but must be the Civil Code. It may avail of moral
duly proved, and proved with a damages under the analogous cases
reasonable degree of certainty. A listed in Article 2219, such as for libel,
court cannot rely on speculation, slander or any other form of
conjecture or guesswork as to the defamation. (Republic vs. Tuvera,
fact and amount of damages, but G.R. No. 148246, February 16, 2007)
must depend upon competent proof
that they have been suffered and on • As a general rule, indeed, moral
evidence of the actual amount damages are not recoverable in an
thereof. (Sui Yong vs. Intermediate action predicated on a breach of
Appellate Court, G.R. No. 64398, contract. This is because such action
November 6, 1990) is not included in Article 2219 of the
Civil Code as one of the actions in
Moral Damages which moral damages may be
• Moral damages include physical recovered. By way of exception,
suffering, mental anguish, fright, moral damages are recoverable in an
serious anxiety, besmirched action predicated on a breach of
reputation, wounded feelings, moral contract: (a) where the mishap
shock, social humiliation, and similar results in the death of a passenger, as
injury. Though incapable of provided in Article 1764, in relation
pecuniary computation, moral to Article 2206 (3) of the Civil Code;
damages may be recovered if they and (b) where the common carrier
are the proximate result of has been guilty of fraud or bad faith,
defendant’s wrongful act or as provided in Article 2220 of the Civil
omission. (People vs. Baylon, 129 Code. (Philtranco Service Enterprises,
SCRA 62 [1984]) Inc. vs. Felix Paras, et al., G.R. No.
161909, April 25, 2012)
• Moral damages, though incapable of
pecuniary estimation, are in the Nominal Damages
category of award designed to • The court may award nominal
compensate the claimant for actual damages in every obligation arising
injury suffered and not to impose a from any source enumerated in
penalty on the wrongdoer. Article 1157, or in every case where
(Prudenciado vs. Alliance Transport, any property right has been invaded.
L-33836, March 16, 1987) (Cogeo-Cubao Operators and Drivers
charges.
Page 115 of 117
Association vs. Court of Appeals, G.R.
No. 100727, March 18, 1992) Liquidated Damages
• It is wrong to award, along with
nominal damages, temperate or • Liquidated damages are those
moderate damages. The two awards agreed upon by the parties to a
are incompatible and cannot be contract, to be paid in case of a
granted concurrently. Nominal breach thereof. Liquidated damages
damages are given in order that a are identical to penalty insofar as
right of the plaintiff, which has been legal results are concerned.
violated or invaded by the Intended to ensure the performance
defendant, may be vindicated or of the principal obligation, such
recognized, and not for the purpose damages are accessory and
of indemnifying the plaintiff for any subsidiary obligations. x x x Since the
loss suffered by him. (Citytrust Bank principal obligation was void, there
vs. Intermediate Appellate Court, was no contract that could have been
G.R. No. 84281, May 27, 1994) breached by petitioners; thus, the
stipulation on liquidated damages
Temperate Damages was inexistent. The nullity of the
• When the court finds that some principal obligation carried with it the
pecuniary loss has been suffered but nullity of the accessory obligation of
the amount cannot, from the nature liquidated damages. (Menchavez vs.
of the case, be proved with certainty, Teves, G.R. No. 153201, January 26,
temperate damages may be 2005)
recovered. Temperate damages may
be allowed in cases where from the Exemplary or Corrective Damages
nature of the case, definite proof of • In contracts, exemplary damages
pecuniary loss cannot be adduced, may be awarded if the defendant
although the court is convinced that acted in a wanton, fraudulent,
the aggrieved party suffered some reckless, oppressive or malevolent
pecuniary loss. (Premiere manner. (Maersk Line vs. Court of
Development Bank vs. Court of Appeals, GR. No. 94761, May 17,
Appeals, G.R. No. 159352, April 14, 1993)
2004)
• The record however does not show • Exemplary damages may be imposed
that petitioner presented proof of by way of example or correction only
the actual amount of expenses he in addition, among others, to
incurred which seems to be the compensatory damages, but they
reason the trial court awarded to him cannot be recovered as a matter of
temperate damages instead. This is right, their determination depending
an erroneous application of the upon the discretion of the court. x x x
concept of temperate damages. In the absence of any claim and proof
While petitioner may have indeed of compensatory damages, the
suffered pecuniary losses, these by award of exemplary damages has no
their very nature could be leg to stand on. (Lozano vs.
established with certainty by means Ballesteros, L-49470, April 8, 1991)
of payment receipts. As such, the
claim falls unequivocally within the Damages in Case of Death
realm of actual or compensatory • Under Art. 2206 of the Civil Code, the
damages. (Barzaga vs. Court of amount of damages for death caused
Appeals, G.R. No. 115129, February by a crime or quasi-delict is
12, 1997) P3,000.00. At present, however, civil
charges.
Page 116 of 117
• indemnity for death has been
increased to P75,000. The same
amount is awarded as moral damages
and exemplary damages, regardless
of the number of qualifying
aggravating circumstances present.
(People vs. Roa, G.R. No. 225599,
March 22, 2017)
• In addition, the defendant shall be

liable for loss of the earning capacity
of the deceased. Compensation of
this nature is awarded not for loss of
earnings, but for loss of capacity to
earn money. The liability for the loss
of the earning capacity of the
deceased is fixed by taking into
account the net income of the victim
at the time of death -- of the incident
in this case -- and that person's
probable life expectancy.
Grounds for Mitigating or Reducing Amount

of Damages
• The plaintiff’s negligence contributed
to the damage;
• The plaintiff himself has contravened
the terms of the contract;
• The plaintiff has derived some benefit
as a result of the contract;
• In cases where exemplary damages
are to be awarded, that the defendant
acted upon the advice of counsel;
• The loss would have resulted in any
event;
• Since the filing of the action, the
defendant has done his best to lessen
the plaintiff’s loss or injury.
charges.
Page 117 of 117

2022 Jurists Pre-Week Pointers On Civil Law Part 1

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2022 Jurists Pre-Week Pointers On Civil Law Part 1

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JURISTS BAR REVIEW CENTER™

2022 Pre-Week Pointers on Civil Law Part 1

• Waiver is the intentional Article 9. No judge or court shall decline to

Minority Incapable of State of being deaf- Incapable of

Trusteeship Incapable of  Juridical Persons

◦ The case of Limjoco vs. Use of Surnames

Rules on Surnames of Children  An Affidavit to Use the Surname of

◦ Included are children who  Where and what to File:

 It is mandatory if the ◦ 10 years (ordinary)

◦ Note: in case of legal  For purposes of remarriage: (Art. 41,

Absence ◦ 4 years (ordinary)

POINTS TO REMEMBER FROM THE As a union entered in accordance with law:

 Any military commander of a  The parties must appear

Note: On the marriage license:

 Marriages solemnized by persons  It is issued by the local civil registrar

 If the Filipino spouse • Note:

DIVORCE OBTAINED ABROAD • Basis

• The root cause of the psychological • It must be caused by a

VOIDABLE MARRIAGES • Legal separation is decreed

• It is the suspension of the common • Attempt of respondent to corrupt or

• Final judgment sentencing the • Recrimination. Where both parties

• Drug addiction or habitual alcoholism • This is mutual guilt.

• Sexual infidelity or perversion. • Collusion. Where there is collusion

• Abandonment by respondent • By committing a ground for

• Consent. Where the aggrieved party • Prescriptive period – 5 years

PROPERTY RELATIONS • Exclusions

• Governed by • Property (inclusive of fruits

REGIME OF SEPARATION OF PROPERTY • Common-law spouses

• Actual joint contribution PROOF OF FILIATION

• Common-law spouses with Art. 172, Family Code:

• Paternity is the status or relation of • Children conceived as a result of

ILLEGITIMATE CHILDREN • Legitimation - takes place by

• If claiming legitimacy • Note: Upon the expiration of the

• If claiming illegitimacy Grounds to impugn filiation

• Parental Authority • Grounds

NOTES ON SUCCESSIONS ELEMENTS OF SUCCESSION

What is Succession? • Death (either actual or presumed) of

• Exception – When practical INSTITUTION OF HEIRS

• Disinheritance is a testamentary • When the heir has been found guilty

In every obligation there is a right in NATURE AND EFFECT OF OBLIGATIONS

❑ Obligations with a period ◦ In a "joint" obligation, each

Application of Payments Tender and Consignation

• The term “voluntary” may be o When without the knowledge

• Payment of an obligation which has • Voluntary performance after

o When a right to sue upon a o When, after an action to

o When a testate or intestate • Through estoppel, an admission or

o When a will is declared void • Estoppel in pais

What is a Trust? • Express trust or one that

• Constructive trust or one • Art. 1451, CC (Legal title to land is

Solutio Indebiti Types of contract of sale

 In case the lessor fails to make the ▪ Assignment of lease or subleasing of

KINDS OF PARTNERS UNIVERSAL PARTNERSHIP

▪ Capitalist partner or one who ▪ Universal Partnership of all Present

WHEN MANAGEMENT NOT AGREED UPON WHAT IS A SUB-PARTNERSHIP

PROPERTY RIGHTS RIGHTS OF SUB-PARTNER OR ASSOCIATE

WHAT IS A CHARGING ORDER? RIGHT TO PARTICIPATE IN MANAGEMENT

▪ Charging Order ▪ The parties can appoint a Managing

RIGHTS OF A LIMITED PARTNER • Elements:

LIABILITIES/OBLIGATIONS OF A LIMITED • Consensual, because it is based on

Notes on Mutuum • Monetary interest is the

• When hotel-keeper liable: (Art. 2000, • Consensual – can be perfected by

There is an abuse of right when it is exercised ACTS CONTRA BONUS MORES

• In addition, the defendant shall be