Donation

Define donation

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

When a person gives to another a thing or right on account of the latter's 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. (Art. 726, CC)

Requisites

1) Decrease or reduction of the patrimony of the donor;

2) Increase of the patrimony of the donee; and

3) Animus dodandi or the intent to make a donation

Different kinds of donation

A. As to their effectivity

1. Donations inter vivos - those which take effect upon independently of the donor's death.

a. Simple donations, or acts of pure liberality a person disposes gratuitously of a thing or right in favor of another, who accepts it. (Art. 725, CC)

b. Remunerative donations, or those which a person gives to another on account of the services rendered by the latter to the former, provided that they do not constitute a demandable debt. (Art. 726, CC)

c. Conditional donations, or those where the donor imposes upon the donee a burden or charge which is less than the value of the thing given. (Art. 726, CC)

d. Onerous donations, or those which a person gives to another in consideration of demandable debts (Art. 733, CC)

2. Donations mortis causa - those which are effective upon the donor's death and must therefore be governed by the rules on testamentary succession.

B. As to their perfection or extinguishment

1. Pure donations - those which are immediately demandable

2. Donations with a condition - those whose effectivity are subordinated to the fulfillment of non-fulfillment of a future and uncertain fact or event

3. Donations with a term - those whose effectivity or extinguishment is subject to the expiration of a term or period.

Distinction between donation inter vivos and donation mortis causa

1. DIV takes effect independently of the donor's death, whereas DMC takes effect upon the death of the donor;

2. In DIV title or ownership is conveyed to the transferee before the death of the transferor, whereas in DMC, such title or ownership is conveyed only upon the death of the transferor;

3. DIV is valid if the transferor should survive the transferee, whereas DMC is void;

4. DIV is, as a general rule, irrevocable during the transferor's lifetime, whereas DMC is always revocable; and

5. DIV must, as a general rule, comply with the formalities prescribed by Arts. 748 and 749 of the Civil Code, whereas DMC must always comply with the formalities required for the the execution of wills.

Why is there a need to distinguish a donation inter vivos from a donation mortis causa

There is a need of distinguishing a donation inter vivos from a donation mortis causa in order to determine:

1. When the donation shall take effect.

2. Whether or not there is a transfer of title or ownership during the lifetime of the donor.

3. Whether or not the donation is revocable.

4. The effect if the donor survives the donee.

5. The formalities which must be complied with in their execution.


(Source: Desiderio P. Jurado, Civil Law Reviewer, 2006 ed.)

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Who May Donate?

Who may donate?

All persons who may contract and dispose of their property may make a donation. (Art. 735, CC)

Requisites

In order that a person can make a donation, three requisites are necessary. They are:

1. He must have the capacity to enter into contracts;

2. He mast be able to dispose of his property; and,

3. He must not be prohibited or disqualified by law from making the donation.   

Can guardians and trustees donate the property entrusted to them?

Guardians and trustees cannot donate the property entrusted to them. (Art. 736, CC)

When shall the donor's capacity be determined?

The donor's capacity shall be determined as of the time of the making of the donation. (Art. 737, CC)

Can a person donate a property which is not owned by him?

A donation would not be legally feasible if the donor has neither ownership nor real right that he can transmit to the donee. A donation, under Art. 712, CC in relation to Art. 725, CC is also a mode of acquiring and transmitting ownership and other real rights by an act of liberality whereby a person disposes gratuitously that ownership or real right in favor of another who accepts it. It would be an inefficacious process if the donor would have nothing to convey at the time it is made. (Hemedes vs. CA, et al., GR. No. 107132, October 8, 1999)

Source: Desiderio P. Jurado, Civil Law Reviewer, 2006 ed. 

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Who May Receive a Donation?

Who may become donees?

Al those who are not specially disqualified by law therefor may accept donations (Art. 738, CC)

Requisite

In order that a person can accept a donation, only one requisite is necessary. He must not be prohibited or disqualified by law from accepting the donation.

What donations are prohibited by law?

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;

4) Those made to priest who heard the confession of the donor during his last illness, or the minister of the gospel who extended spiritual aid to him during the same period;

5) Those made to 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;

6) Those made by a ward to the guardian before the final accounts of the guardianship have been approved, unless the guardian is an ascendant, descendant, brother, sister;

7) Those made to the attesting witness of the execution of the donation, if there is any, or to the spouse, parents, or children, or any one claiming under such witness, spouse, parents, or children;

8) Those made to the physician, surgeon, nurse, health officer or druggist who took care of the donor during his last illness;

9) Those made by individuals, associations and corporations not permitted by law to make donations;

10) Those made by the spouses to each other during the marriage, or to the persons of whom the other spouse is a presumptive heir.

Incapacity to succeed by will

Incapacity to succeed by will shall be applicable to donations inter vivos. (Art. 740, CC)

May minors and others who cannot enter into a contract become donees? Who shall accept the donation?

Minors and others who cannot enter into a contract may become donees but acceptance shall be done through their parents or legal representatives. (Art. 741, CC)

May conceived and unborn children become donees? Who shall accept the donation?

Yes. Donations made to conceived and unborn children may be accepted by those persons who would legally represent them if they were already born. (Art. 742, CC)

Donations made to incapacitated persons void

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, CC)

Rule on double donation

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. (Art. 744, CC)

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Revocation and Reduction of Donations

What are the different special modes by which donations inter vivos may be revoked?

There are 4 specials modes:

1. Supervening birth, survival, or adoption of a child (Art. 760, CC)

2. Non-fulfillment of the condition or charge imposed (Art. 760, CC)

3. Acts of ingratitude by the donee (Art. 765, CC)

4. Inofficious donations (Art. 771, CC)

What are the different special modes by which donations inter vivos may be reduced?

There are 3 special modes:

1. That the donor did not reserve sufficient means for his support as well as for the support of all relatives who, at the time of the donation, are by law entitled to be supported by such donor (Art. 750, CC)

2.  Supervening birth, survival, or adoption of a child (Art. 760, CC)

3. Inofficious donations (Art. 771, CC)

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Supervening Birth, Survival or Adoption of a Child

What events will justify the donor or his heirs in asking for the revocation or reduction of a donation inter vivos  if, at the time of the donation was made, the donor was childless?

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. (Art. 760, CC)

What will be the extent of the reduction of the donation?

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. (Art. 761, CC)

Illustration

A, husband of B, believing that his wife was sterile, donated a parcel of land valued at P40,000 to D in 1960. B, however, gave birth to a son, C, in 1968. Assuming that the land is exclusive property and that the net value of A’s estate at the time of the birth of C is P40,000, what will be the extent of the reduction of the donation?

In this case, we must first collate or add the value of the donated land to the net value of A’s estate. The sum is P80,000. The legitime of C is ½ or P40,000, while the legitime of B is ¼, or P20,000. That leaves a disposable portion of P20,000. The donation, therefore, is inofficious by P20,000. Hence, it shall be reduced to that extent.

Does the action take place automatically or is a judicial action necessary? If a judicial action is necessary, what is the period of prescription? Is the action transmissible?

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 donor, to his legitimate and illegitimate children and descendants. (Art. 763, CC)

Return of the property or its value

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.

When the property cannot be returned, it shall be estimated at what it was worth at the time of the donation. (Art. 762, CC)

Return of the fruits

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. (Art. 768, CC)

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Non-Fulfillment of the Condition or Charge Imposed

Failure to comply with condition

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. (Art. 764, CC)

What is the prescriptive period for bringing the action for revocation of the donation in case of non-fulfillment of the condition or charge imposed? Is the action transmissible?

The action shall prescribe after four years from the noncompliance with the condition. It may be transmitted to the heirs of the donor, and may be exercised against the donee's heirs. (Art. 764, CC)

Return of the property

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. 764, CC)

May the donee be compelled to return the fruits?

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. 768, CC)

The donor, after the donation was made, sold the property donated to another for failure to comply with the condition imposed. Is the sale an act of revocation?

The act of selling the donated property to another cannot be considered as a valid act of revocation of the deed of donation for the reason that a formal case to revoke the donation must be filed pursuant to Art. 764, CC which speaks of an action that has a prescriptive period of 4 years from non-compliance with the condition stated in the deed of donation. That there can be automatic revocation without the benefit of a court action does not apply in this case since the deed of donation herein is devoid of any provision for automatic revocation in the event of non-compliance with the conditions set forth therein. Thus, a court action is necessary to be filed within 4 years from the non-compliance of the condition violated. (Magat vs. CA, G.R. No. 106756, February 2, 2002). 

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Acts of Ingratitude of the Donee

What are the acts of ingratitude of the donee which will justify the donor in asking for a revocation of the donation?

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. (Art. 765, CC)

Reason for the law

- One who has been the object of generosity must not turn ungrateful.

-  Gratitude is both a moral and legal duty.

Can the donor renounce in advance the action for revocation of donation by reason of ingratitude?

The action granted to the donor by reason of ingratitude cannot be renounced in advance. (Art. 769, CC)

What is the prescriptive period for bringing an action for revocation of donation in case of acts of ingratitude of the donee?

The 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. (Art. 769, CC)

- within one year

- counted from knowledge

- provided that it was possible for him to bring the action

Is the right transmissible?

Being purely personal in character, as a rule, the action is intransmissible. Only the donor can bring the action. Art 770 of the Civil Code declares that the action shall not be transmitted to the heirs of the donor, neither can it be brought against the heirs of the donee.

Exceptions:

1. If the action had already been brought by the donor, but he died before it could be decided;

2. If the circumstances clearly manifest that the donor desired and intended to revoke the donation, but was prevented by sickness, insanity, or even a fortuitous event from bringing the action, and he died without being able to file the corresponding complaint within one-year period of prescription;

3. If the donee killed the donor or inflicted injuries upon him causing his death;

4. If the donor died without having known the act of ingratitude;

5. If the donor had already instituted criminal proceedings against the donee but died before he could file the corresponding civil action for revocation of the donation.

In all these cases the heirs of the donor may institute the action for revocation. 

Can the action be brought against the heirs of the donee?

There is only one instance when the action may be brought against the heirs of the donee, and that is if the complaint has already been filed upon the latter's death. (Art. 770, CC)

Effect of alienations and mortgages if the donation is revoked because of ingratitude

Although the donation is revoked on account of ingratitude, 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. 766, CC)

Rule if third persons have the property or it has been mortgaged

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. (Art. 767, CC)

Returning of fruits

The donee shall not return the fruits except from the filing of the complaint. (Art. 768, CC)

Case:

In April 1984, Pedro donated 1/2 of his land to his niece Helen. In July 1984, another donation was purportedly executed by Pedro ceding unto Helen the whole parcel of land. In 1986, Helen donated to Calauan Christian Reformed Church a portion of the land and in 1988 sold to Eduarte spouses the rest of the land, save the portion where her house stood. Claiming that his signature in the July 1984 deed of donation was a forgery and that she was unworthy of his liberality, Pedro filed a lawsuit to revoke the donation he made in favor of Helen in April 1984. Was there a valid ground to revoke the donation?

Yes. All crimes which offend the donor show ingratitude and are causes for revocation. Falsification of a deed of donation is an act of ingratitude (Sps. Eduarte vs. Court of Appeals, G.R. No. 105944, February 9, 1996, 253 SCRA 391). 

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