Sales
Art. 1458.
Contract of sale-is a contract whereby one of the parties called the seller or vendor obligates himself to deliver something to the other called the buyer or purchases or vendee who on his part, binds himself to pay therefor a sum of money or its equivalent known as the price.
Characteristics of a contract of sale: CBOCNP
PRESIDENTIAL DECREE No. 1067
A DECREE INSTITUTING A WATER CODE, THEREBY REVISING AND CONSOLIDATING THE LAWS GOVERNING THE OWNERSHIP, APPROPRIATION, UTILIZATION, EXPLOITATION, DEVELOPMENT, CONSERVATION AND PROTECTION OF WATER RESOURCES
WHEREAS, Article XIV, Section 8 of the New Constitution of the Philippines provides, inter alia, that all waters of the Philippines belong to the State;
QUIETING OF TITLE
WHAT IS AN ACTION FOR QUIETING OF TITLE/ WHAT ARE ITS REQUISITES?
Art. 476. Whenever there is cloud on title to real property or any interest therein, by reason of any instrument, record, claim, encumbrance or proceeding which is apparently valid or effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title.
An action may also be brought to prevent a cloud from being cast upon title to real property or any interest therein.
Art. 477. The plaintiff must have legal or equitable title to, or interest in the real property which is the subject matter of the action. He need not be in possession of said property.
Art. 478. There may also be an action to quiet title or to remove a cloud therefrom when the contract, instrument or other obligation has been extinguished or has terminated, or has been barred by extinctive prespcription.
Art. 479. The plaintiff must return to the defendant all benefits he may have received from the latter, or reimburse him for expenses that may have redounded to the plaintiff’s benefit.
Case: Ono vs. Lim
Lucasan vs. PDIC
WHAT ARE SOME INSTANCES WHEN CLOUD OF TITLE ON REAL PROPERTY EXISTS?
DOES AN ACTION FOR QUIETING OF TITLE PRESCRIBED?
It depends: If plaintiff is in possession, does not prescribe, only right is to remove or prevent cloud.
If plaintiff is not in possession:
10 years-ordinary prescription
30 years – extraordinary prescription
WHEN ACTION TO QUIET TITLE WILL NOT PROSPER?
POSSESSION
WHAT IS POSSESSION?
Art. 523. Possesion is the holding of a thing or the enjoyment of a right.
Art. 530. Only things and rights which are susceptible of being appropriated may be the object of possession.
WHAT ARE THE ELEMENTS OF POSSESSION?
WHAT ARE THE CLASSES OF POSSESSION?
Art. 524. Possession may be exercised in one’s own name or in that of another.
Art. 525. The possession of things or rights may be had in one of two concepts: either in the concept of owner or in that of the holder of the thing or right to keep or enjoy it, the ownership pertaining to another person.
Art. 540. Only the possession acquired and enjoyed in the concept of owner can serve as title for acquiring dominion.
Art. 526. He is deemed a possessor in good faith who is not aware that there exists in his title or mode of acquisition any flaw which invalidates it.
He is deemed a possessor in bad faith who possesses in any case contrary to the foregoing.
Mistake upon a doubtful or difficult question of law may be the basis of good faith.
Art. 527. Good faith is always presumed, and upon him who alleges bad faith on the part of a possessor rests the burden of proof.
Art. 528. Possession acquired in good faith does not lose this character except in the case and from the moment facts exist which show that the possessor is not unaware that he possesses the thing improperly or wronglfully.
WHAT ARE THE PRESUMPTIONS REGARDING POSSESSION?
Art. 527. Good faith is always presumed, and upon him who alleges bad faith on the part of a possessor rests the burden of proof.
Art. 529. It is presumed that possession continues to be enjoyed on the same character in which it was acquired, until the contrary is proved.
Art. 541. A possessor in the concept of owner has in his favor the legal presumption that he possesses with a just title and he cannot be obliged to show or prove it.
Art. 542. The possession of real property presumes that of the movables therein, so long as it is not shown or proved that they should be excluded.
Art. 554. A present possessor who shows his possession at some previous time, is presumed to have held possession also during the intermediate period, in the absence of proof to the contrary.
HOW IS POSSESSION ACQUIRED?
Art. 531. Possession is acquired by the material occupation of a thing or the exercise of a right, or by the fact that it is subject to the action of our will, or by the proper acts and legal formalities established for acquiring such right.
Art. 532. Possession may be acquired by the same person who is to enjoy it, by his legal representative, by his agent, or by any person without any power whatever; but in the last case, the possession shall not be considered as acquired until the person in whose name the act of possession was executed has ratified the same, without prejudice to the juridical consequences of negotiorum gestio in a proper case.
WHEN DOES AN HEIR ACQUIRE POSSESSION OVER THE PROPERTY HE INHERITED?
Art. 533. The possession of hereditary property is deemed transmitted to the heir without interruption and from the moment of the death of the decedent, in case the inheritance is accepted.
One who validly renounces an inheritance is deemed never to have possessed the same.
Art. 534. One who succeeds by hereditary title shall not suffer the consequences of the wrongful possession of the decedent, if it is not shown that he was aware of the flaws affecting it; but the effects of possession in good faith shall not benefit him except from the date of death of the decedent.
MAY POSSESSION BE ACQUIRED BY MINORS AND OTHER INCAPACITATED PERSONS?
Art. 535. Minors and incapacitated persons may acquire the possession of things; but they need the assistance of their legal representatives in order to exercise the rights which from the possession arise in their favor.
WHAT ARE THE INSTANCES WHEN LEGAL POSSESSION (RIGHT TO POSSESSION) CANNOT BE ACQUIRED?
Art. 536. In no case may possession be acquired through force or intimidation as long as there is a possessor who objects thereto. He who believes that he has an action or right to deprive another of the holding of a thing, must invoke the aid of the competent court, if the holder should refuse to deliver the thing.
Art. 537. Acts merely tolerated,and those executed clandestinely and without the knowledge of the possessor of a thing, or by violence, do not affect possession.
MAY POSSESSION AS A FACT BE ORGANIZED AT THE SAME TIME IN TWO DIFFERENT PERSONLAITIES?
Art. 538. Possession as a fact cannot be recognized at the same time in two different personalities except in the case of co-possession. Should a question arise regarding the fact of possession, the present possessor shall be preferred; if there are two possessors, the one longer in possession, if the dates of possession are the same, the one who presents a title; and if all these conditions are equal, the thing shall be placed in judicial deposit pending determination of its possession or ownership through proper proceedings.
WHAT ARE THE RIGHTS OF A POSSESSOR?
Art. 539. Every possessor has a right to be respected in his possession; and should he be disturbed therein he shall be protected in or restored to said possession by the means extablished by the laws and the rules of court.
A possessor deprived of his possession through forcible entry may within ten days from the filing of the complaint present a motion to secure from the competent court, in the action for forcible entry, a writ of preliminary mandatory injunction to restore him in his possession. The court shall decide the motion within thirty (30) days from filing thereof.
Art. 541. A possessor in the concept of owner has in his favor the legal presumption that he possesses with a just title and he cannot be obliged to show or prove it.
Art. 543. Each one of the participants of a thing possessed in common shall be deemed to have exclusively possessed the part which may be allotted to him upon the division thereof, for the entire period during which the co-possession lasted. Interrruption in the possession of the whole or a part of a thing possessed in common shall be to the prejudice of all the possessors. However, in case of civil interruption, the rules of court shall apply.
Art. 545. If at the time the good faith ceases, there should be any natural or industrial fruits, the possessor shall have a right to a part of the expenses of cultivation, and to a part of the net harvest, both in proportion to the time of possession.
the charges shall be divided on the same basis by the two possessors.
The owner of the thing may, should he so desire, give the possessor in good faith the right to finish the cultivation and gathering of the growing fruits,as an indemnity for his part of the expenses of cultivation and gathering of the the growing fruits, as an indemnity for his part of the expenses of cultivation and the net proceeds; the possessor in good faith who for any reason whatever should refuse to accept this concession, shall lose the right to be indemnified in any other manner.
Art. 449. He who builds, plants or sows in bad faith on the land of another, loses what is built, planted or sown without right to indemnity.
Art. 544. A possessor in good faith is entitled to the fruits received before the possession is legally interrupted.
Natural and industrial fruits ate considered received from the time they are gathered or severed.
Civil Fruits are deemed to accrue daily and belong to the possessor in good faith on that proportion.
Art. 549. The possessor in bad faith shall reimburse the fruits received and those which the legitimate possessor could have received, and shall have a right only to the expenses mentioned in paragraph 1 of Article 546 and in Article 443. The expenses incurred in improvements for pure luxury or mere pleasure shall not be refunded to the possessor in bad faith; but he may remove the objects for which such expenses have been incurred, provided that the thing suffers no injury thereby,and that the lawful possessor does not prefer to retain them by paying the value they may have at the time he enters into possession.
Art. 539. Every possessor has a right to be respected in his possession; and should he be disturbed therein he shall be protected in or restored to said possession by the means established by the laws and the rules of court.
A possessor deprived of his possession through forcible entry may within ten days from the filing of the compliant present a motion to secure from the competent court, in the action for forcible entry, a writ of preliminary mandatory injunction to restore him in his possession. The court shall decide the motion within thirty (30) days from filing thereof. (446a)
Art. 547. if the useful improvements can be removed without damage to the principal thing, the possessor in good faith may remove them, unless the person who recovers the possession exercises the option under paragraph 2 of the preceding article.
Art. 548. Expenses for pure luxury or mere pleasure shall not be refunded to the possessor in good faith; but he may remove the ornaments with which he has embellished the principal thing if it suffers no injury thereby,and if his successor in the possession does not prefer to refund the amount expended.
Art. 549. The possessor in bad faith shall reimburse the fruits received and those which the legitimate possessor could have received, and shall have a right only to the expenses mentioned in paragrapgh 1 of Art. 546 and in Art. 443. The expenses incurred in improvements for pure luxury or mere pleasure shall not be refunded to the possessor in bad faith; but he may remove the objects for which such expenses have been incurred, provided that the thing suffers no injury thereby, and that the lawful possessor does not prefer to retain them by paying the value they may have at the time he enters into possession.
Art. 551. Improvements caused by Nature or time shall or time shall always inure to the benefit of the person who has succeeded in recovering possession.
Art. 550. The costs of litigation over the property shall be borne by every possessor.
WHAT IS THE LIABILITY OF THE POSSESSOR TO THE RIGHTFUL POSSESSOR OR OWNED IN CASE OF LOSS OR DETERIORATION?
Art. 552. A possessor in good faith shall not be liable for the deterioration or loss of the thing possessed, except in cases in which it is proved that he has acted with fraudulent intent or negligence, after the judicial summons.
A possessor in bad faith shall be laible for deterioration or loss in every case, even if caused by a fortuitous event.
WHEN IS POSSESSION OF MOVABLES EQUIVALENT TO TITLE?
Art. 559. The possession of movable property acquired in good faith is equivalent to a title. Nevertheless, one who has lost any movable or has been unlawfully deprived thereof, may recover it from the person in possession of the same.
If the possessor of a movable lost or of which the owner has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot obtain its return without reimbursing the price paid therefor.
HOW IS POSSESSION EXTINGUISED?
Art. 555. A possessor may lose his possession:
(1)By the abandonment of the thing;
(2)By an assignment made to another either by onerous or gratuitous title;
(3)By the destruction or total loss of the thing, or because it goes out of commerce;
(4)By the possession of another, subject to the provisions of Article 537, if the new possession has lasted longer than one year. But the real right of possession is not lost till after the lapse of ten years. (460a)
Article 556.The possession of movables is not deemed lost so long as they remain under the control of the possessor, even though for the time being he may not know their whereabouts. (461)
Article 561.One who recovers, according to law, possession unjustly, shall be deemed for all purposes which may redound to his benefit to have enjoyed it without interruption. (467)
When possession is recovered by the owner, is he obligated to reimburse the expenses incurred by the possessor in acquiring the?
Cases: Imuan vs. cereno
Semirara Coal Corp vs. HGL Dev’t corp
Calicdan vs. Cendana
Lubos vs. Galupo
Cequena vs. Bolante
PNB vs. CA
Caniza vs. CA
Habagat Grill v. DMC
TITLE III. CO-OWNERSHIP
WHAT IS CO-OWNERSHIP?
Art. 484. There is co-ownership whenever the ownership of an undivided thing or right belongs to different persons.
In default of contracts, or special provisions, co-ownership shall be governed by the provisions of this Title.
Characteristics of co-ownership:
WHAT GOVERNS CO-OWNERSHIP?
HOW DOES CO-OWNERSHIP DIFFER FROM PARTNERSHIP
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CO-OWNERSHIP |
PARTNERSHIP |
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1. No legal personality |
has legal or juridical personality |
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2. created by contract or by other things |
created by contract only (express/implied) |
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3. purpose-collective enjoyment |
purpose is profit |
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4. agreement for it to exist for 10 years is valid. (if |
there is no term limit set by the law |
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more than 10 years, the excess is void) |
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20 years is the maximum if imposed by the testator |
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or the donee of the common property. |
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5. as a rule, no mutual representation |
as a rule, there is mutual representation |
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6. not dissolved by death or incapacity of co-owner |
is dissolved by the death or incapacity of |
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partner |
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7. can dispose of his share without consent of others |
cannot substitute another as partner in his |
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place without consent of the others. |
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8. profits must always depend on proportionate |
profits may be stipulated upon |
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shares. |
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HOW DOES CO-OWNERSHIP DIFFER FROM CONJUGAL PARTNERSHIP?
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CO-OWNERSHIP |
CONJUGAL PARTNERSHIP |
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1. may arise by an ordinary contract |
Arises only because of the marriage contract |
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2. sex of the co-owners is immaterial |
Male and female |
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3. co-owners maybe two or more |
Always two |
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4. profits are proportional to respective interests. |
Profits are generally 50-50 unless a contrary stipulation is in a marriage settlement |
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5. death of one does not dissolve the co-owneship |
Death of either husband or wife dissolves the conjugal partnership |
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6. generally all the co-owners administer |
Generally, the husband is the administrator |
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7. co-ownership is discouraged by law |
Encouraged by law to provide for better family solidarity. |
WHAT RULES GOVERN THE IDEAL SHARES OF CO-OWNERS?
Art. 485. The shares of the co-owners, in the benefits as well as in the charges, shall be proportional to their respective interests. Any stipulation in a contract to the contrary shall be void.
The portions belonging to the co-owners in the co-ownership shall be presumed equal, unless the contrary is proved.
Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership.
Art. 1620. A co-owner of a thing may exercise the right of redemption in case the shares of all the other co-owners or any of them, are sold to a third person. If the price of the alienation is grossly excessive, the redemptioner shall pay only a reasonable one.
Should two or more co-owners desire to exercise the right of redemption, they may only do so in proportion to the share they may respectively have in the thing owned in common.
WHAT RIGHT DOES A CO-OWNER HAVE IN THE USE OF THE PROPERTY OWNED IN COMMON? MAY ANY ONE OF THE CO-OWNERS CHANGE THE PURPOSE OF THE CO-OWNERSHIP?
Art. 486. Each co-owner may use the thing owned in common, provided he does so in accordance with the purpose for which it is intended and in such a way as not to injure the interest of co-ownership or prevent the other co-owners from using it according to their rights. The purpose of the co-ownership may be changed by agreement, express or implied.
WHO AMONG THE PARTNERS HAS THE RIGHT TO BRING AN ACTION FOR EJECTMENT?
Art. 487. Any one of the co-owners may bring an action in ejectment.
WHAT IS THE SHARE OF THE CO-OWNERS IN THE BENEFITS AND CHARGES?
Art. 485. The shares of the co-owners, in the benefits as well as in the charges, shall be proportional to their respective interests. Any stipulation in a contract to the contrary shall be void.
The portions belonging to the co-owners in the co-ownership shall be presumed equal, unless the contrary is proved.
WHAT IS THE RIGHT OF THE CO-OWNERS WITH RESPECT TO THE EXPENSES OF PRESERVATION OF THE COMMON PROPERTY?
Art. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may excempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the co-ownership.
Art. 489. Repairs for preservation may be made at the will of one of the co-owners , but he must, if practicable, first notify his co-owners of the necessity for such repairs. Expenses to improve or embellish the thing shall be decided upon by a majority as determined in Article 492.
MAY A CO-OWNER IMPROVE OR EMBELLISH THE THING OWNED IN COMMON (ACTS OF ADMINISTRATION)?
Art. 489. Repairs for preservation may be made at the will of one of the co-owners , but he must, if practicable, first notify his co-owners of the necessity for such repairs. Expenses to improve or embellish the thing shall be decided upon by a majority as determined in Article 492.
Art. 492. For the administration and better enjoyment of the thing owned in common, the resolutions of the majority of the co-owners shall be binding.
There shall be no majority unless the resolution is approved by the co-owners who represent the controlling interest in the object of the co-ownership.
Should there be no majority, or should the resolution of the majority be seriously prejudicial to those interested in the property owned in common, the court, at the instance of an interested party, shall order such measures as it may deem proper, including the appointment of an administrator.
Whenever a part of the thing belongs exclusively to one of the co-owners, and the remainder is owned in common, the preceeding provisions shall apply only to the part owned in common.
HOW IS CO-OWNERSHIP EXTINGUISHED?
WHAT IS PARTITION?
Article 494. No co-owner shall be obliged to remain in the co-ownership. Each co-owner may demand at any time the partition of the thing owned in common, insofar as his share is concerned.
Nevertheless, an agreement, to keep the thing undivided for a certain period of time, not exceeding ten years shall be valid. This term may be extended by a new agreement.
A donor or testator may prohibit partition for a period which shall not exceed twenty years.
Neither shall there be any partition when it is prohibited by law.
No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership.
HOW IS PARTITION EFFECTED?
Art. 496. Partition may be made by agreement between the parties or by judicial proceedings. Partition shall be governed by the Rules of Court insofar as they are consistent with this code.
DOES THE RIGHT OF THE CO-OWNERS TO DEMAND PARTITION PRESCRIBED?
Article 494. No co-owner shall be obliged to remain in the co-ownership. Each co-owner may demand at any time the partition of the thing owned in common, insofar as his share is concerned.
Nevertheless, an agreement, to keep the thing undivided for a certain period of time, not exceeding ten years shall be valid. This term may be extended by a new agreement.
A donor or testator may prohibit partition for a period which shall not exceed twenty years.
Neither shall there be any partition when it is prohibited by law.
No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership.
MAY A CO-OWNER ACQUIRE PROPERTY OWNED IN COMMON THROUGH PRESCRIPTION?
Art. 494 (last paragraph) No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership.
WHAT ARE THE LIMITATIONS ON THE RIGHT OF THE CO-OWNERS TO DEMAND PARTITION?
Article 494. No co-owner shall be obliged to remain in the co-ownership. Each co-owner may demand at any time the partition of the thing owned in common, insofar as his share is concerned.
Nevertheless, an agreement, to keep the thing undivided for a certain period of time, not exceeding ten years shall be valid. This term may be extended by a new agreement.
A donor or testator may prohibit partition for a period which shall not exceed twenty years.
Neither shall there be any partition when it is prohibited by law.
No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership.
Art. 495. Notwithstanding the provisions of the preceeding article, the co-owners cannot demand a physical division of the thing owned in common, when to do so would render it unserviceable for the use which it is intended. But the co-ownership may be terminated in accordance with Article 498.
Art. 498. Whenever the thing is essentially indivisible and the co-owners cannot agree that it be allotted to one of them who shall indemnify the others, it shall be sold and its proceeds distributed.
WHAT ARE THE RIGHTS OF THE CREDITORS OR ASSIGNEES OF THE CO-OWNERS IN CASE OF PARTITION?
Art. 497. The creditors or assignees of the co-owners may take part in the division of the thing owned in common and object to its being effected without their concurrence. But they cannot impugn any partition already executed, unless there has been fraud, or in case it was made notwithstanding a formal opposition presented to prevent it, without prejudice to the right of the debtor or assignor to maintain its validity.
WHAT ARE THE RIGHTS OF THIRD PERSONS IN CASE OF PARTITION?
Art. 499. The partition of a thing owned in common shall not prejudice third persons, who shall retain the rights of mortgage, servitude, or any other real rights belonging to them before the division was made. Personal rights pertaining to third persons against the co-ownership shall also remain in force, notwithstanding the partition.
WHAT ARE THE EFFECTS OR CONSEQUENCES OF PARTITION?
Art. 500. Upon partition, there shall be a mutual accounting for benefits received and reimbursements for expenses made. Likewise, each co-owner shall pay for damages caused by reason of his negligence or fraud.
Art. 501. Every co-owner shall, after partition, be liable for defects of title and quality of the portion assigned to each of the other co-owners.
WHAT IS PERPENDICULAR CO-OWNERSHIP?
Art. 490. Whenever the different stories of a house belongs to different owners, if the titles of ownership do not specify the terms under which they should contribute to the necessary expenses and there exists no agreement on the subject, the following rules shall be observed:
SUMMARY OF CONSEQUENCES OF CO-OWENRSHIP?