PROPERTY REVIEWER Part 14 DONATION I.

Nature of Donation
a bilateral contract creating unilateral obligations on donors part. Art. 731. When a person donates something, subject to the resolutory condition of the donor's survival, there is a donation inter vivos.

All obligations flow from donors side.

II. Requisites of Donation

(1) Consent and capacity of parties (2)Animus donandi (causa) (3) Delivery of thing donated (4) Form as prescribed by law There must be impoverishment in fact of donors patrimony and enrichment on part of donee.

III. Kinds of Donation

(1) As to its taking effect (a) Inter vivos (Art. 729, 730, 731) Art. 729. When the donor intends that the donation shall take effect during the lifetime of the donor, though property shall not be delivered till after the donors death, this shall be a donation inter vivos. The fruits of the property from the time of the acceptance of the donation, shall pertain to the donee, unless the donor provides otherwise. Art. 730. The fixing of an event or the imposition of a suspensive condition, which may take place beyond the natural expectation of life of the donor, does not destroy the nature of the act as a donation inter vivos, unless a contrary intention appears.

Nature of a donation is not made to depend by the title given by the donor but by what is expressed. To determine whether mortis causa or inter vivos, nature of act, whether it is disposition or execution, is controlling. If disposition is not made to depend upon death of the donor, donation is inter vivos even if its execution may be completed until after donors death Taking effect of donation during the lifetime or after the death does not depend upon whether property is delivered during such lifetime or after such death. From the moment donor gratuitously disposes of his property and it is accepted by the donee, donation exists. In doubt, conveyance should be deemed a donation inter vivos to avoid uncertainty as to the ownership of the property. Donation inter vivos is irrevocable except: (1) During the subsequent birth of the donors children (2) Failure of donee to comply which conditions imposed (3) Ingratitude of donee, and (4) Reduction of the donation by reason of inofficiousness

165
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER

Donation inter vivos is irrevocable. It may be made revocable upon fulfillment of resolutory conditions but this implies that the donation has taken effect. Where the ownership and possession as well as administration were turned over to the donee but right to reap and dispose of the fruits was deferred until after donors death, donation is inter vivos. Art. 732. Donations which are to take effect inter vivos shall be governed by the general provisions on contracts and obligations in all that is not determined in this Title. (b) Mortis causa (Art. 728) Art. 728. Donations which are to take effect upon the death of the donor partake of the nature of testamentary provisions, and shall be governed by the rules established in the Title on Succession Art. 87. Every donation or grant of gratuitous advantage, direct or indirect, between the spouses during the marriage shall be void, except moderate gifts which the spouses may give each other on the occasion of any family rejoicing. The prohibition shall also apply to persons living together as husband and wife without a valid marriage.

(2) As to Cause or Consideration

(a) Simplegratuitous and irrevocable. The cause is the pure liberality, generosity, or fondness of the Donor. There are no strings attached.

Art. 725. Donation is an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another, who accepts it.

A donation mortis causa not in the form of a will is not valid and does not transmit any right. If the donor reserves the right to dispose of all the properties purportedly donated, there is no donation inter vivos but mortis causa. (c) Propter nuptias (Art. 82, 87 Family Code) Art. 82. Donations by reason of marriage are those which are made before its celebration, in consideration of the same, and in favor of one or both of the future spouses.

Donations made by reason of the merits of the donee are simple donations. Donation of property under leasehold contract is valid. Donor intended to give something of value to the donee even at the time it was not possible to give the laws per se to the donee. (huh? From Tolentinos book.) Elements of donation: (1) Reduction of the patrimony of the donor (2) Increase in the patrimony of the donee (3) Intent to do an act of liberality (animus donandi) Donation of land by a person who is not the owner is void. When a person gets a life insurance and names a third person as beneficiary and then the insurance becomes payable 166

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
by the death of the insured, there is a donation in favor of the beneficiary in the form of total amount of premiums paid by the insured. It is on this basis that Art. 2012 provides: Any person who is forbidden from receiving a donation under Art. 739 cannot be named beneficiary of a life insurance policy by the person who cannot make a donation to him. (b) Remuneratoryall other donations aside from simple donations. They are those which remunerate past services which do not constitute demandable debts. Motivating cause is gratitude. Art. 726. When a person gives to another thing or right on account of the latters merits or of the services rendered by him to the donor, provided they do not constitute a demandable debt, or when the gift imposes upon the donee a burden which is less than the value of the thing given, there is also a donation.

Code follows the principle in succession because both donation and succession are gratuitous modes of transmitting ownership unless it appears that the donor would not have made the donation without the mode or condition

(c) Onerous (imposes a burden inferior in value to property donated); donations for a valuable consideration considered the equivalent of the donation such as when donation is given in compensation of recoverable debt Art. 733. Donations with an onerous cause shall be governed by the rules on contracts and remuneratory donations by the provisions of the present Title as regards that portion which exceeds the value of the burden imposed.

They do not constitute a demandable debt means service which was rendered did not produce an obligation demandable against the donor. Art. 727. Illegal or impossible conditions in simple and remuneratory donations shall be considered as not imposed.

Only the illegal or impossible condition is considered as not written. Donation is valid free from the donation. Donation will be simple.

This is improperly called a donation because it is a contract and is governed by the rules on contracts It was erroneous to have made reference to remuneratory donations in this article. Such donations are treated as pure or simple donations. Remuneratory donation does not imply existence of a burden. Remuneratory donation here is the conditional or modal donation. These donations may be given for services to be performed by donee. In remuneratory donations, services have already been performed while in onerous, services are to be performed in the future. Kinds of onerous donations: 167

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
(i) Improper burden equal in
value to property donated (ii) Sub modo or modal imposes a prestation upon donee as to how property donated will be applied (iii) Mixed negotium mixtum cum donations. It is sale for price lower than the value of the property Onerous donations are governed by the rules of contract directly as to the onerous part. As to the part exceeding the burden, the rules on contract are only suppletory, those on simple donation being of primary application. Modal donation imposes a burden inferior to the value of the property donated. Any limitation, charge, or condition imposed upon the donee must be considered as burden, by condition being meant not an uncertain event but a charge. Burden may consist in real or personal charge capable of valuation in money. Mode does not affect the rights of the donee. It is an accessory disposition by virtue of which the benefit conferred on the donee is restricted. Remuneratory donation in Art. 733 is really a conditional donation. They are modal donations and have a dual nature. Portion exceeding the value of the burden imposed constitutes a real donation while the portion equivalent to the burden is governed by rules on obligations and contracts. Mode is to be distinguished from the consideration or the counter-prestation in an onerous juridical transaction. (3) As to its Effectivity or Extinguishment (a) Pure (b) Conditional (Art. 730, 731) donation is not carried out until the day comes but it produces effects Art. 730. The fixing of an event or the imposition of a suspensive condition, which may take place beyond the natural expectation of life of the donor, does not destroy the nature of the act as a donation inter vivos unless a contrary intention appears. What is the effect of an impossible condition? In simple and remuneratory donations, the condition is considered as not written at all. Prof. Labitag says donee should disregard it as probably due to the quirkiness of the donor. In onerous donations, the donation will be considered void because it makes the obligation illusory. It means the obligor never meant to be bound by the obligation. This is not so in simple and remuneratory donations because of the different causeeither pure liberality (simple) or intent to recompense for past debt (remuneratory). Art. 731. When a person donates something, subject to the resolutory condition of the donors survival, there is a donation inter vivos. (c) With a term He who donates with a term has already disposed of the thing donated and cannot revoke it nor can he dispose the thing in favor of another unless 168
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
the donor postpones execution and reserves the right to revoke (4) Importance of Classification (a) As to form form depends on whether it is mortis causa or inter vivos (b) As to governing rules if mortis causa, testate succession rules are used; if inter vivos, rules on donation are used. -- if simple and remuneratory, rules on donation are used; if onerous, use oblicon rules (c) As to impossible conditions Art. 727, 1183 - in simple and remuneratory, merely disregard the impossible condition as non-existent - in onerous donations, the obligation is nullified by the impossible condition Art. 1183. Impossible conditions, those contrary to good customs or public policy and those prohibited by law shall annul the obligation which depends upon them. If the obligation is divisible, that part thereof which is not affected by the impossible or unlawful condition shall be valid. The condition not to do an impossible thing shall be considered as not having been agreed upon. Art. 734. The donation is perfected from the moment the donor knows of the acceptance by the donee. Perfection presumes a demandable juridical relation. The donor can no longer withdraw and he can be compelled to comply. Acceptance is necessary because nobody is obliged to receive a benefit against his will. When the donation and the acceptance are in the same instrument, signed by both donor and donee, donation is perfected. After perfection, donation can only be revoked by the consent of the donee or by judicial decree especially when the donation is onerous. Mere declaration of an intention without intent to transfer is not a donation even if accepted.

(5) Characteristics of a Donation Mortis Causa ( ) Conveys no title or ownership before donors death () Before donors death, transfer is revocable () Transfer is void if donor survives donee (Also: In the form of a will)

(6) Distinction Between Donation Mortis

Causa and Donation Inter Vivos (a) What is important is the time of transfer of ownership (not possession), even if transfer of property donated may be subject to a condition or a term (b) Importance of classification Validity and revocation of donation. (Mortis causa can be revoked at any time before the death of the donor. Can donor still change his mind before he dies? If yes, then its mortis causa.)

IV. Persons Who May Give Or Receive Donations

(Art. 735, 737, 738, 741, 742) General Rules: Who may give? (1) Those with property (in fact, one who has excess property 169

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
(2) Has capacity to contract. Donation can be voidable if he has no capacity, unless the law makes it VOID. Who may receive? (1) All those who are not specially disqualified by law e.g. husband and wife during marriage, not propter nuptias (2) Even if incapacitated e.g. minors, insane, etc. (acceptance made through parents or legal guardian); conceived and unborn (acceptance made through legal representatives if they were born) Capacity is determined at the time donation is made, which is upon perfection of the donation, when the donor has knowledge of the donees acceptance. Art. 735. All persons who may contract and dispose of their property may make a donation. donors capacity must exist. Donation is made when the donor executes the instrument of donation or tells the donee that he is giving the property by way of donation. Even if the donor had capacity when he manifested his will to make the donation if at the moment he learns of the acceptance he has no capacity to act, there could be no juridical basis for perfection because perfection presupposes the meeting of the minds of two persons with capacity to act. Making of donation must be held to mean perfection of the donation. Capacity of donor must be determined as of the perfection of the donation. Art. 738. All those who are not specially disqualified by law therefore may accept donations. All persons whether natural or artificial may be donees. Art. 741. Minors and others who cannot enter into a contract may become donees but acceptance shall be done through their parents or legal representatives. Minors and incapacitated persons generally do not have capacity to make a formal acceptance. In pure donations, a minor or incapacitated person may validly receive a donation of personal property when made orally with simultaneous delivery. But when the donation requires a formal acceptance or it imposes obligations upon the donee, the acceptance can be made only through the parents or legal representative. 170
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

Capacity required is for disposition inter vivos and not mortis causa. Both capacity to contract and the capacity to dispose of property must exist in order to have capacity to donate. Emancipated minor cannot donate immovable property because while he can contract, he cannot alienate. (not applicable now?) Husband may have capacity to contract but not the capacity to donate (to wife). Art. 737. The donors capacity shall be determined as of the time of the making of the donation. Time of making the donation must be the moment in which the

PROPERTY REVIEWER
Mother may accept a simple donation on behalf of her children. If conditional or onerous, mother cannot make a valid acceptance. She must have been appointed as legal representative or guardian. If she makes an acceptance without being the legal guardian, the acceptance is void. (still?) Art. 742. Donations made to conceived and unborn children may be accepted by those persons who would legally represent them if they were already born. the beneficiary. In the present case, the guardian or trustee is acting for himself. Art. 739. The following donations shall be void: (1) Those made between persons who were guilty of adultery or concubinage at the time of the donation; (2) Those made between persons found guilty of the same criminal offense, in consideration thereof; (3) Those made to a public officer or his wife, descendants and ascendants, by reason of his office. In the case referred to in No. 1, the action for declaration of nullity may be brought by the spouse of the donor or donee; and the guilt of the donor and donee may be proved by preponderance of evidence in the same action. When the purpose of the donation is to initiate, continue, resume or compensate the illicit relations between paramours, the donation is void. But if intention is to indemnify the damage caused to the other at time of separation, donation is valid. Court should look into the facts which gave rise to the illicit relation to see if it originated from a seduction through deceit by the man after which the woman has resigned herself to the status of concubine. If this is the case, agreement to pay an amount to end the relationship must be upheld. Public officers wife must be interpreted to mean spouse so as to include the husband. Labnotes According to Sir, memorize Arts. 1027 and 1032. Art. 1027. The following are incapable of succeeding: 171
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

V. Persons Who May Not Give or Receive Donations

(Art. 736, 739, 1027, 1032, 740, 743) Art. 736. Guardians and trustees cannot donate the property entrusted to them.

The guardian or trustee has only legal ownership, not beneficial ownership. If they do donate, it is not valid as a donation, but might be enough for purposes of acquisitive prescription. This case is analogous to having property but cannot legally sell it. If he does sell, transferee get only what rights transferor has Nemo dat quod non habet (No one can give what one does not have.) Labnotes Q: What happens if the guardian or trustee donates property under the guardianship or trusteeship? Does this make the donation unenforceable? A: NO. Under the Civil Code, the donation is unenforceable only if the guardian or trustee acts in the name of

PROPERTY REVIEWER
(1) The priest who heard the confession of the testator during his last illness, or the minister of the gospel who extended spiritual aid to him during the same period; (2) The relatives of such priest or minister of the gospel within the fourth degree, the church, order, chapter, community, organization, or institution to which such priest or minister may belong; (3) A guardian with respect to testamentary dispositions given by a ward in his favor before the final accounts of the guardianship have been approved, even if the testator should die after the approval thereof; nevertheless, any provision made by the ward in favor of the guardian when the latter is his ascendant, descendant, brother, sister, or spouse, shall be valid; (4) Any attesting witness to the execution of a will, the spouse, parents, or children, or any one claiming under such witness, spouse, parents, or children; (5) Any physician, surgeon, nurse, health officer or druggist who took care of the testator during his last illness; (6) Individuals, associations and corporations not permitted by law to inherit. Art. 1032. The following are incapable of succeeding by reason of unworthiness: (1) Parents who have abandoned their children or induced their daughters to lead a corrupt or immoral life, or attempted against their virtue; (2) Any person who has been convicted of an attempt against the life of the testator, his or her spouse, descendants, or ascendants; (3) Any person who has accused the testator of a crime for which the law prescribes imprisonment for six years or more, if the accusation has been found groundless; (4) Any heir of full age who, having knowledge of the violent death of the testator, should fail to report it to an officer of the law within a month, unless the authorities have already taken action; this prohibition shall not apply to cases wherein, according to law, there is no obligation to make an accusation; (5) Any person convicted of adultery or concubinage with the spouse of the testator; (6) Any person who by fraud, violence, intimidation, or undue influence should cause the testator to make a will or to change one already made; (7) Any person who by the same means prevents another from making a will, or from revoking one already made, or who supplants, conceals, or alters the latter's will; (8) Any person who falsifies or forges a supposed will of the decedent.

Art. 740. Incapacity to succeed by will shall be applicable to donations inter vivos. Disqualification to inherit of the persons in par. 1,2,3,5, and 6 of Art. 1027 are applicable to the donee. Incapacity to inherit by reason of unworthiness in 1032 is not included within the scope of this article. Donation would be valid because a testamentary provision made in favor of such a person after the testator has knowledge of the act of unworthiness would constitute a pardon under 1033. If donation has already been made when the cause of the unworthiness occurs, donation is not revoked because donations inter vivos are revoked only by causes mentioned in Art. 760, 764, and 765. Besides, capacity of the donee is to be determined at time of 172

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
perfection of the donation when the property passes. Art. 743. Donations made to incapacitated persons shall be void, though simulated under the guise of another contract or through a person who is interposed. Art. 743 refers to persons who are disqualified to become donees. They are the persons to whom donations cannot be made in Art. 739 and 740. Labnotes Q: Does it refer to absolutely simulated or to relatively simulated, or both? A: You find out because I dont know the answer either. Relevant CC provisions: Art. 1345, 1346. Q: What if a person donates to his concubines mother? A: Donation is void according to the law. Those who institute the action for recovery are those affected by the donationthe heirs and creditors. Once declared void, the property returns to the patrimony of the donor. Art. 744. Donations of the same thing to two or more different donees shall be governed by the provisions concerning the sale of the same thing to two or more different persons. Apply double sales to double donations: Art. 1544. If the same thing should have been sold to different vendees, the ownership shall be transferred to the person who may have first taken possession in good faith, if it should be movable property. Should it be immovable, the ownership shall belong to the person acquiring it who in good faith first recorded it in the Registry of Property. Should there be no inscription, the ownership shall pertain to the person who in good faith was first in possession and in the absence to the person who presents the oldest title provided there is good faith. Q: What if there was a donation, then a subsequent sale, or vice versa? A: The Rules still apply. Labnotes Criticism by Sir: provisions on double sales should not be applied in double donations because the situation in donation is different. If a property is donated (1st donation), there is already a transfer of ownership so that there is no more real right of ownership to be transferred should there be 2nd donation.

VI. Acceptance of Donation

(a) Who may accept (Art. 745, 747) - donee personally or through authorized person - representatives of incapacitated must make notification and notation Art. 745. The donee must accept the donation personally, or through an authorized person with a special power for the purpose, or with a general and sufficient power; otherwise, the donation shall be void. Art. 747. Persons who accept donations in representation of others who may not do so by themselves, shall be obliged to make the notification and notation of which Art. 749 speaks. (b) Time of acceptance of donation inter vivos (Art. 746), mortis causa 173

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
Art. 746. Acceptance must be made during the lifetime of the donor and of the donee. If the donor dies before he learns of the acceptance, the donation does not take effect, even if the acceptance is made during the lifetime of the donor. Ratio: there was no meeting of the minds. made in a public document, specifying therein the property donated and the value of the charges which the donee must satisfy. The acceptance may be made in the same deed of donation or in a separate public document, but it shall not take effect unless it is done during the lifetime of the donor. If the acceptance is made in a separate instrument, the donor shall be notified thereof in an authentic form, and this step shall be noted in both instruments. Art. 1357 is not applicable. Donee cannot bring an action to compel the donor to execute a public instrument of donation. That article is applicable only to contracts which validly exist and cannot be held applicable to a case where the form is required in order to make it valid. A public instrument is not necessary in cases of onerous donations because they are governed by the rules on contracts. Where the donor executed private instruments of donation and after his death his only heir executed a public instrument ratifying the donation, such public instrument cannot be considered as having retroactively perfected the gift. It might serve as a quitclaim on the part of the heir who is estopped from asserting any right to the properties. Charges are the charges in onerous or conditional donations, the intention of the law being that the true value of the donation be determined. These refer to the burdens imposed upon the immovable property donated. It is necessary that formal notice thereof be given to the donor and the fact that due notice has been given must be noted in both instruments. If the instrument of donation has been recorded in the registry of 174

VII. Form of Donations

(a) Personal property (Art. 748) Art. 748. The donation of a movable may be made orally or in writing. An oral donation requires the simultaneous delivery of the thing or of the document representing the right donated. If the value of the personal property donated exceeds five thousand pesos, the donation and the acceptance shall be made in writing, otherwise, the donation shall be void. Document of donation need not be public instrument. When donation does not exceed P5,000, it may be made orally or in writing. If made orally, there must be simultaneous delivery. If no simultaneous delivery, donation is void unless it is made in writing. The law does not require that when the donation is made in writing the acceptance should also be in writing (if value does not exceed P5,000). (b) Real property (Art. 749) Art. 749. In order that the donation of an immovable may be valid, it must be

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
property, the instrument that shows the acceptance should also be recorded. If acceptance has been made but before the donor has been notified, the donor dies, the donation is not perfected. If the donors heirs ratify the donation and the donee or his heirs accept, the donation subsists but in reality it is a new and valid one. While a donation of immovable property not made in a public instrument is not effective as a transfer of title, it is a circumstance which may explain the adverse and exclusive character of the possession of the intended donee and such possession may ripen into ownership by prescription. The donation of immovables must be made in a public instrument for validity. Acceptance could be in the same public instrument or in another public instrument, but the donor should be informed of the acceptance, and this fact is duly noted in both public instruments the original deed and the subsequent deed. The safest way is to do it by affixing acceptance in the same public instrument where the donation is made. Q: Can the donee compel the donor to comply with the proper form, agree to reformation, etc? A: No. Donation (of movables worth P5,000 or more or immovables) requires such to be written to be valid. Art. 1357 gives the right to contracting parties to compel each other to execute the formalities required by law. However, this article presupposes the existence of a valid contract and cannot possibly refer to the form required to make it valid but rather to that required to make it effective. Labnotes Q: What is the effect of an oral donation of immovable property? A: It is void as a donation. However, it may be valid as basis for possession in the concept of owner. Extraordinary acquisitive prescription will apply. (c) Rules in Art. 748 and 749 not applicable to: i. onerous donations ii. modal donations iii. mortis causa donations iv. donations propter nuptias

VIII. What May Be Donated

(1) All present property, or part thereof, of donor (a) Provided he reserves, in full ownership or usufruct, sufficient means for support of himself and all relatives to be supported by donor at time of acceptance (Art. 750) Art. 750. The donations may comprehend all the present property of the donor, or part thereof, provided he reserves, in full ownership or in usufruct, sufficient means for the support of himself, and of all relatives who, at the time of the acceptance of the donation, are by law entitled to be supported by the donor. Without such reservation, the donation shall be reduced in petition of any person affected.

Article applies to all kinds of donations except donation mortis causa, the donation propter nuptias and the onerous donation. Donation of all property without the reservation of a sufficient amount for his subsistence is not void but only 175

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
susceptible of reduction. It is voidable with respect to the amount necessary for the support. (b) Provided that no person may give or receive by way of donation more than he may give or receive by will (Art. 752); also, reserves property sufficient to pay donors debts contracted before donation, otherwise, donation is in fraud of creditors (Art. 759, 1387) Art. 752. The provisions of Art. 750 notwithstanding, no person may give or receive, by way of donation, more than he may give or receive by will. The donation shall be inofficious in all that it may exceed this limitation. Limitation applies to persons who have compulsory heirs. Amount that can be donated depends upon the character of the compulsory heirs and the amount of property at the time of the death of donor. Donation is not a nullity but only subject to reduction. sufficient property to pay all debts contracted before the donation. Alienations by onerous title are also presumed fraudulent when made by persons against whom some judgment has been rendered in any instance or some writ of attachment has been issued. The decision or attachment need not refer to the property alienated and need not have been obtained by the party seeking the rescission. In addition to these presumptions, the design to defraud creditors may be proved in any other manner recognized by the law on evidence. Q: Can a donor donate everything he has? A: No. He is supposed to keep enough for support of himself and his heirs, and for his creditors. If he donates all, he will become insolvent. Q: If he becomes insolvent, what will be the effect? A: For the heirs, the donation may be revoked or reduced on the ground of inofficiousness. For the creditors, the donation becomes rescissible under accion pauliana. If donation exceeds the disposable or free portion of his estate, donation is inofficious. Exceptions: (a) Donations provided for in marriage settlements between future spouses (Art. 84, Family Code; Art. 130 CC) not more than 1/5 of present property Art. 84. If the future spouses agree upon a regime other than the absolute community of property, they cannot donate to each other in their marriage settlements more than 1/5 of their present property. Any excess shall be considered void. Donations of future property shall be governed by the provisions on 176
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

Art. 759. There being no stipulation regarding the payment of debts, the donee shall be responsible therefor only when the donation has been made in fraud of creditors. The donation is always presumed to be in fraud of creditors, when at the time thereof the donor did not reserve sufficient property to pay his debts prior to the donation. Art. 1387. All contracts by virtue of which the debtor alienates property by gratuitous title are presumed to have been entered into in fraud of creditors, when the donor did not reserve

PROPERTY REVIEWER
testamentary succession and the formalities of wills. Art. 130. The future spouses may give each other in their marriage settlements as much as 1/5 of their present property, and with respect to their future property, only in the event of death, to the extent laid down by the provisions of this Code referring to testamentary succession. (b) Donations of jewelry, furniture or clothing not to exceed 1/10 of disposable portion (Art. 1070) Art. 1070. Wedding gifts by parents and ascendants consisting of jewelry, clothing, and outfit, shall not be reduced as inofficious except insofar as they may exceed 1/10 of the sum which is disposable by will. (2) What May Not be Donated Art. 751. Donations cannot comprehend future property. By future property is understood anything which the donor cannot dispose of at the time of the donation. Future Property includes all property that belongs to others at the time the donation is made. Properties to which the donor has a right although the delivery may be fixed for a future date, are not future properties and can be donated. So also are those which pertain to him conditionally and will become his upon the happening of a suspensive condition. He may donate his rights to such properties in the condition in which such rights may be at the time of the donation. Properties of an existing inheritance cannot be considered future property. Exception: marriage settlements of future spouses only in the event of death to extent laid down in the CC regarding testamentary succession (Art. 130 of Civil Code and Art. 84 of the Family Code)

IX. Effect of Donation

A. In General (1) Donee may demand actual delivery of the thing donated. (2) Donee is subrogated to rights of donor in the property donated. (3) Donor not obligated to warrant things donated, except in onerous donations in which case, donor is liable for eviction up to the extent of the burden. (4) Donor is liable for eviction or hidden defects in case of bad faith on his part.

Art. 754. The donee is subrogated to all the rights and actions which in case of eviction would pertain to the donor. The latter, on the other hand, is not obliged to warrant the things donated, save when the donation is onerous, in which case the donor shall be liable for eviction to the concurrence of the burden. The donor shall also be liable for eviction or hidden defects in case of bad faith on his part. Q: Are the implied warranties in sales applicable in donations? A: It depends on the kind of donation. If it is a simple or remuneratory donation, there are no warranties except that donor is liable if he is in bad faith. If 177

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
it is an onerous donation, donor is liable for implied warranties because the donation is governed by the law on contracts. (5) In donations propter nuptias donor must release property donated from mortgages and other encumbrances, unless contrary has been stipulated Art. 131. The donor by reason of marriage shall release the property donated from mortgages and all other encumbrances upon the same, with the exception of easements, unless in the marriage settlements or on the contracts the contrary has been stipulated. Art. 753. When a donation is made to several persons jointly, it is understood to be in equal shares, and there shall be no right of accretion among them, unless the donor has otherwise provided. The preceding paragraph shall not be applicable to donations made to the husband and wife jointly, between whom there shall be a right of accretion, if the contrary has not been provided by the donor. B. Special Provisions (1) Reservation by donor of power to dispose (in whole or in part) or to encumber property donated. Art. 755. The right to dispose of some of the things donated, or of some amount which shall be a charge thereon, may be reserved by the donor; but if he should die without having made use of this right, the property or amount reserved shall belong to the donee. (2) Donation of naked ownership to one donee and usufruct to another. Art. 756. The ownership of property may also be donated to one person and the usufruct to another or others provided all the donees are living at the time of the donation. (3) Conventional reversion in favor of donor or other person. Art. 757. Reversion may be validly established in favor of only the donor for any case and circumstances, but not in favor of other persons unless they are all living at the time of the donation. Any reversion stipulated by the donor in favor of a third person in violation of what is provided in the preceding 178
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

(a) Donations propter nuptias

of property subject to encumbrances are valid.

Art. 85 FC-Effect of foreclosureDonations by reason of marriage of property subject to encumbrances shall be valid. In case of foreclosure of the encumbrance and the property is sold for less than the amount of the obligation secured, the donee shall not be liable for the deficiency. If the property is sold than the total amount of said obligation, the donee shall be entitled to the excess. (6) Donation to several donees jointlyno right of accretion Except donation provides otherwise donation to husband and wife jointly with right of accretion (jus accrescendi), unless the donor provides otherwise.

PROPERTY REVIEWER
paragraph shall be void, but shall not nullify the donation. (4) Payment of donors debt (a) If expressly stipulated-donee to pay debts contracted before the donation, unless specified otherwise, but in no case shall the donee be responsible for debts exceeding value of property donated, unless clearly intended (b) If there is no stipulation-donee answerable only for donors debt only in case of donation in fraud of creditors. Art. 758. When the donation imposes upon the donee the obligation to pay the debts of the donor, if the clause does not contain any declaration to the contrary, the former is understood to be liable to pay only the debts which appear to have been previously contracted. In no case shall the donee be responsible for the debts exceeding the value of the property donated, unless a contrary intention clearly appears. Art. 759. There being no stipulation regarding the payment of debts, the donee shall be responsible therefore only when the donation has been made in fraud of creditors. The donation is always presumed to be in fraud of creditors, when at the time thereof the donor did not reserve sufficient property to pay his debts prior to the donation. Liability of the donee for the debts of the donor should be considered as limited to the value of the thing donated. Creditors may demand the rescission of the donation. If the credits exceed the value of the property, the donee cannot be held liable for such excess. If the donee has alienated the property to one who acquired it in good and he is unable to return it, he will be held liable in damages but the damages cannot exceed the value of the property itself. Art. 751. Donations cannot comprehend future property. By future property is understood anything which the donor cannot dispose of at the time of the donation. Future property includes all property that belongs to others at the time the donation is made, although it may or may not later belong to the donor. It CANNOT be donated because it is not at present his property, and he cannot dispose of it at the moment of making the donation. But properties to which the donor has a RIGHT, although the delivery of such properties to him may be fixed for a future date, are NOT future properties, and can be donated by him. So also are those properties which pertain to him CONDITIONALLY, and will become his upon the happening of a suspensive condition. Properties of an existing INHERITANCE cannot be considered future property of the heirs after the death of the predecessor, because the rights of the heirs are acquired on the 179
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
moment of death, even if the delivery to them of the property may be delayed. Basis of this principle is that the donor cannot deliver or dispossess himself of the future property; besides, the mere desistance of the donor from acquiring the thing will virtually be a revocation Art. 752. The provisions of Article 750 notwithstanding, no person may give or receive, by way of donation, more than he may give or receive by will. The donation shall be inofficious in all that it may exceed this limitation. The limitation imposed on this article applies to persons who have compulsory heirs. The amount that can be donated depends upon the character of the compulsory heirs and the amount of the property at the time of the death of the donor. The donation itself is not a nullity, but only subject to reduction in so far as it exceeds what the donor could have given by will to the donee. Amount determinable only at the death of the donor.

X. Revocation and Reduction of Donation

A. Revocation distinguished from reduction of donation Labnotes (1) Revocation involves ALL the property of the donor while reduction involves only a PART of such property (2) Reduction of donation has lesser grounds than revocation. Situation Reduction After the 10 donations, the donor made an 11th donation, of which encroached on the legitime of the heirs. In this case, that portion which encroached will be reduced. Q: What if the donation involved indivisible property (ex. House and lot)? A: see Ramirez v Ramirez case Revocation In the same situation, any subsequent donation beyond the 11th donation will be revoked. B. Causes of Reduction/ Revocation (1) Inofficiousness of donation

Art. 750. The donations may comprehend all the present property of the donor, or part thereof, provided he reserves, in full ownership or in usufruct, sufficient means for the support of himself, and of all relatives who, at the time of the acceptance of the donation, are by law entitled to be supported by the donor. Without such reservation, the donation shall be reduced in petition of any person affected. Donations Covered All kinds of donations except the donation mortis causa, propter nuptias and onerous donations. Conditional or modal donations, there may be sufficiently left to the donor for his subsistence Status of Donation A donation of all the present property of the donor, without reservation of a sufficient amount 180

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
for his subsistence, is NOT VOID, but only susceptible of reduction. It is VOIDABLE with respect to the amount necessary for the support of the donor or his dependent relatives. Art. 771. Donations which in accordance with the provisions of Article 752, are inofficious, bearing in mind the estimated net value of the donor's property at the time of his death, shall be reduced with regard to the excess; but this reduction shall not prevent the donations from taking effect during the life of the donor, nor shall it bar the donee from appropriating the fruits. For the reduction of donations the provisions of this Chapter and of Articles 911 and 912 of this Code shall govern. Art. 773. If, there being two or more donations, the disposable portion is not sufficient to cover all of them; those of the more recent date shall be suppressed or reduced with regard to the excess. Art. 911. After the legitime has been determined in accordance with the three preceding articles, the reduction shall be made as follows: (1) Donations shall be respected as long as the legitime can be covered, reducing or annulling, if necessary, the devices or legacies made in the will; (2) If the testator has directed that a certain devise or legacy be paid in preference to others, it shall not suffer any reduction until the latter have been applied in full to the payment of the legitime. (3) If the device or legacy consists of a usufruct or life annuity, whose value may be considered greater than that of the disposable portion, the compulsory heirs may chose between complying with the testamentary provision and delivering to the devisee or legatee the part of the inheritance of which the testator could freely dispose. Art. 912. If the device subject to reduction should consist of real property which cannot be conveniently divided, it shall go to the device if the reduction does not absorb of its value; and in the contrary case, to the compulsory heirs; but the former and the latter shall reimburse each other in cash for what respectively belongs to them. The devisee who is entitled to a legitime may retain the entire property, provided its value does not exceed that of disposable portion and of the share pertaining to him as a legitime. (a) Who may ask for reduction

Art. 772. Only those who at the time of the donor's death have a right to the legitime and their heirs and successors in interest may ask for the reduction or inofficious donations. Those referred to in the preceding paragraph cannot renounce their right during the lifetime of the donor, either by express declaration, or by consenting to the donation. The donees, devisees and legatees, who are not entitled to the legitime and the creditors of the deceased can neither ask for the reduction nor avail themselves thereof. (b) Rule appliedIf disposable portion not sufficient to cover two or more donations Art. 773. If, there being two or more donations, the disposable portion is not sufficient to cover all of them, those of the more recent date shall be 181

BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
suppressed or reduced with regard to the excess. Reason for the Rule The reduction or annulment of inofficious donations shall be made in the inverse order of their dates, in accordance to the principle that priority in time gives priority in right. The 1st donations are within the free portion and the later donations are the ones that impair the legitime. This is in consonance with the irrevocability of donations inter vivos; the donor cannot revoke a prior donation by making subsequent donations to others. When Made at the Same Time There must be a PROPORTIONAL REDUCTION of simultaneous donations, because then the donees would have equal rights. The donor, however, may impose a preference in this case, but his priority must be EXPRESSLY stated in the donation. (2) Subsequent birth, reappearance of child, or adoption of minor by donor. Art. 760. Every donation inter vivos, made by a person having no children or descendants, legitimate or legitimated by subsequent marriage, or illegitimate, may be revoked or reduced as provided in the next article, by the happening of any of these events: (1) If the donor, after the donation, should have legitimate or legitimated or illegitimate children, even though they be posthumous; (2) If the child of the donor, whom the latter believed to be dead when he made the donation, should turn out to be living; (3) If the donor subsequently adopt a minor child. Donations Covered Art. 760 applies to all donations intervivos not to mortis causa not to onerous donations. Donation propter nuptias are revocable only for the causes mentioned in Art. 132 not in this article. Donors Included Art 760 applies when the donor, at the time he made the donation, did not have, or believed he did not have, any legitimate child or descendant, or children legitimated by subsequent marriage, or illegitimate children. Law presumes that the donor would not have made the donation if he had or knew he had a child who would naturally be entitled to his affection and property. It is not sufficient that there be a recognition or legitimation after the donation has been made, It is necessary that the child be born subsequent to the donation. Birth of Child In order that the subsequent birth of a child may revoke a donation, it is necessary that the child must not have been conceived before such donation was made because the existence of the child begins from its conception. This should be qualified. Donations cannot be revoked when the child was 182
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
already conceived at the time of donation, only if the donor was AWARE of the conception of his child. In this case, he made the donation knowing that he has a child that that is about to be born. Appearance of Descendant If the donor makes a donation after an absent child is known to have already died but did not know that such child had a child, the Code does not speak of descendants. Although the donation is not revoked, it may be reduced as inofficious if it impairs the legitime of the descendant. Adopted Child Adoption of a minor child revokes the donation. When Revocation Takes Place Revocation takes place ipso jure. NO action is necessary to revoke the donation, already revoked by the happening of any of these events. This does not mean that no recourse to the court is necessary. Court action will be needed if the donee alleges that the circumstances required are not present. The Decision of the court will be merely declaratory. Events mentioned in this article are resolutory conditions of the donation. The donee shall return the fruits only from the time the complaint is filed. Revocation and return of the property to the donor or his heirs are not self-executory. Resort to judicial action should be taken. Death of Children If the child born subsequent to the donation should die before the complaint for revocation is filed, donation remains subsisting. Art. 761. In the cases referred to in the preceding article, the donation shall be revoked or reduced insofar as it exceeds the portion that may be freely disposed of by will, taking into account the whole estate of the donor at the time of the birth, appearance or adoption of a child. 1. There is a mere reduction or partial revocation. 2. The donation will be revoked only to the extent of the presumptive legitime of the child; it will remain valid with respect to the free portion, taking into account the estate of the donor at the time of the birth, appearance, or adoption of the child. 3. This change may prevent the revocation or reduction of the donation. Let us suppose a donation of P10,000. A legitimate child is born. Donor has properties worth P40,000. Free portion of the estate of the donor is of such estate. Donation of P10,000 does not exceed such free portion. There will be no revocation. But such donation may still be subject to revocation or reduction as inofficious. Art. 763. The action for revocation or reduction on the grounds set forth in article 760 shall prescribe after four years from the birth of the first child, or from his legitimation, recognition or adoption, or from the judicial declaration of filiation, or from the time information was received regarding the existence of the child believed dead. This action cannot be renounced, and is transmitted, upon the death of the 183
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
donor, to his legitimate and illegitimate children and descendants. Prescription of Action After the period of prescription has expired following the birth of the 1st child, the birth of another legitimate child does NOT revive the prescription period. If the child is an illegitimate child, not natural, it does NOT have to be recognized in order to have rights. The period of prescription must run from the date of the birth of the illegitimate child. Its status is already fixed at birth. Legitimated Children Two acts which bring about legitimation are the birth of the child and the subsequent marriage of the parents. Acts must BOTH be present. Legitimation is used in this article to refer to the acts giving rise to the status and not to the moment when the status legally commences. Concurrence of Causes Whenever there are several causes for revocation, earliest among them which causes the revocation shall be the point of departure in computing the prescription. Art. 764. The donation shall be revoked at the instance of the donor, when the donee fails to comply with any of the conditions which the former imposed upon the latter. In this case, the property donated shall be returned to the donor, the alienations made by the donee and the mortgages imposed thereon by him being void, with the limitations established, with regard to third persons, by the Mortgage Law and the Land Registration Laws. This action shall prescribe after four years from the noncompliance with the condition, may be transmitted to the heirs of the donor, and may be exercised against the donees heirs. (647a) Meaning of Condition Conditions in this article do not refer to uncertain events but charges that may be imposed for the benefit of the donor himself or of a third person. Period For Performance When a donation imposes certain conditions which must be fulfilled by the donee but does not fix the period within which the condition must be complied with, the court must fix a period for the fulfillment of such condition. Once the court has fixed such term, it is supplementary to and becomes part of the donation or original agreement and is not subject to change or extension by the court without the consent of both parties. Effect of Non-Fulfillment The donor has the choice of enforcing the charge by an action for specific performance or of revoking the donation. The donee, having bound himself to carry out the charge imposed by accepting the donation, may be compelled to comply with what has been stipulated. Even when the charge is in favor of a third person, the donor may still revoke the donation when the charge is not fulfilled, because the donor has both the 184
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
moral and a material interest therein. The third party beneficiary can only ask for performance of the charge, but not for the revocation of the donation, unless he succeeds to the rights of the donee as his heir. (1) Ingratitude Art. 765. The donation may also be revoked at the instance of the donor, by reason of ingratitude in the following cases: (1) If the donee should commit some offense against the person, the honor or the property of the donor, or of his wife or children under his parental authority; (2) If the donee imputes to the donor any criminal offense, or any act involving moral turpitude, even though he should prove it, unless the crime or the act has been committed against the donee himself, his wife or children under his authority; (3) If he unduly refuses him support when the donee is legally or morally bound to give support to the donor. (a) Causes Donations Covered This article applies to all donations except mortis causa, propter nuptias, and onerous donations. Acts Imputable to Donee The obligation of gratitude is founded on the idea of moral duty. He who has received a donation must be grateful to his benefactor. This duty is personal. Ingratitute Limited Donation inter vivos cannot be revoked on the ground of ingratitude except for the causes mentioned in this article. The enumeration is restrictive. Offenses Against Donor All crimes which offend the donor show ingratitude and are causes of revocation. 185
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

Partial Non-Fulfillment Partial non-fulfillment of a condition is as much a ground for revocation as total revocation because to be considered fulfilled, the condition must be totally complied with. However, when the part fulfilled offers great utility to the donor, the courts are considered empowered to decree only a partial revocation and even to deny revocation when the unperformed part is insignificant. Transmission Of The Donors Rights The donors right to revoke for non-performance of condition is transmitted to his heirs. If the charge is divisible, each heir can ask for a partial revocation. If it is indivisible, heir can ask for total revocation. Each heir can ask for revocation of the donation as to his share. He shall be paid in cash the value of his part. Death of Donee The death of the donee does NOT bar the action of the donor to revoke the donation for failure of the donee during his lifetime to fulfill the conditions imposed on him. The action may be brought against his heirs and their assigns. C. Revocation (only)

PROPERTY REVIEWER
Failure to Support Donor If the donor is reduced to extreme necessity, he has a right to ask for support from the donee. If the latter refuses, the donation may be revoked. The impoverished must have a right against the donee whom he once favored. Amount of Support Support which the donee can be required to give to the donor cannot exceed the value of the donation; because once that value is exhausted, there is no more donation (b) Time to file action for revocation Art. 769. The action granted to the donor by reason of ingratitude cannot be renounced in advance. This action prescribes within one year, to be counted from the time the donor had knowledge of the fact and it was possible for him to bring the action. (c) Who may file Art. 770. This action shall not be transmitted to the heirs of the donor, if the latter did not institute the same, although he could have done so, and even if he should die before the expiration of one year. Neither can this action be brought against the heir of the donee, unless upon the latter's death the complaint has been filed. Transmission of Action Acts of ingratitude are personal to the donee; upon the death of the latter, the offense is erased and action for revocation can not be instituted by the heirs. It is only when the action has already been filed that it is allowed to continue against the heirs of the donee. The law does NOT absolutely forbid the transmission of the action to the heirs of the donor. If the act has caused the death of the donor, his heirs may ask for revocation. To prevent transmission of action to donors heir, it is necessary that the donor did not do so. He alone can judge the acts of the donee. When renunciation, express or implied appears clearly, the heirs of the donor cannot bring the action. The non-transmission of the action does not depend upon the period of time that elapses but upon whether the donor could have brought the action but did not do so. BUT: if the donor dies without having known of the act of ingratitude, his heirs may institute the action for revocation,. The heirs may bring the action when the donor has instituted criminal proceedings against the donee but dies before giving a civil action for revocation, because in such case the intent of the donor not to pardon is quite clear. (d) Effect of revocation on alienation and mortgages. Art. 766. Although the donation is revoked on account of ingratitude, 186
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER
nevertheless, the alienations and mortgages effected before the notation of the complaint for revocation in the Registry of Property shall subsist. Later ones shall be void. Art. 767. In the case referred to in the first paragraph of the preceding article, the donor shall have a right to demand from the donee the value of property alienated which he cannot recover from third persons, or the sum for which the same has been mortgaged. The value of said property shall be fixed as of the time of the donation. (2) Violation of condition (a) Prescription of action- 4 years from the time the condition was violated or its noncompliance. (b) Transmissibility of action- 4 years from the appearance of the child or his existence be known. When the property cannot be returned, it shall be estimated at what it was worth at the time of the donation. Art. 764. The donation shall be revoked at the instance of the donor, when the donee fails to comply with any of the conditions which the former imposed upon the latter. In this case, the property donated shall be returned to the donor, the alienations made by the donee and the mortgages imposed thereon by him being void, with the limitations established, with regard to third persons, by the Mortgage Law and the Land Registration Laws. Art. 767. In the case referred to in the first paragraph of the preceding article(ingratitude), the donor shall have a right to demand from the donee the value of property alienated which he cannot recover from third persons, or the sum for which the same has been mortgaged. The value of said property shall be fixed as of the time of the donation. (4) Effect as to the fruits Art. 768. When the donation is revoked for any of the causes stated in Article 760, or by reason of ingratitude, or when it is reduced because it is inofficious, the donee shall not return the fruits except from the filing of the complaint. If the revocation is based upon noncompliance with any of the conditions imposed in the donation, the donee shall return not only the property but also the fruits thereof which he may have received after having failed to fulfill the condition.

Art. 764. par 3 This action shall prescribe after four years from the noncompliance with the condition, may be transmitted to the heirs of the donor, and may be exercised against the donee's heirs. (3) Effect of revocation or reduction Art. 762. Upon the revocation or reduction of the donation by the birth, appearance or adoption of a child, the property affected shall be returned or its value if the donee has sold the same. If the property is mortgaged, the donor may redeem the mortgage, by paying the amount guaranteed, with a right to recover the same from the donee.

187
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia

PROPERTY REVIEWER

If revocation by Art. 760 or ingratitude-return fruits gained from filing of complaint If revocation by noncompliancereturn fruits gained after failure to fulfill condition.

188
BLOCKD2008 al.beth.kalin.may.miles.py special thanks to: anna.bodee.cha.etol.hardy.len.mia