How is a sale extinguished? transaction whereby ownership is transferred by onerous title.

It must
This provision of the New Civil Code has laid down three instances on
how a sale can be extinguished:
Art. 1600. Sales are extinguished by the same causes as all other
obligations, by those stated in the preceding articles of this Title, and
by conventional or legal redemption. (1506)
be exercised within thirty (30) days from the notice in writing by the
vendor. This does not apply to barter, donation, transmission of things
by hereditary title, mortgage, lease.
What are the instances of legal redemption?
1. Under the Civil Code

What is conventional redemption? 1. Sale of co-owner of his share to a stranger

The happening of conventional redemption is best defined under this 2. When a credit or other incorporeal right in litigation is sold
provision:
3. Sale of an heir of his hereditary rights to a stranger
Art. 1601. Conventional redemption shall take place when the vendor
reserves the right to repurchase the thing sold, with the obligation to 4. Sale of adjacent rural lands not exceeding one hectare
comply with the provisions of Article 1616 and other stipulations which
5. Sale of adjacent small urban lands bought merely for
may have been agreed upon. (1507)
speculation
*Conventional redemption isthe right which the vendor reserves to
6. Under special laws
himself, to reacquire the property sold provided he returns to the vendee
the price of the sale, expenses of the contract, any other legitimate 7. An equity of redemption in cases of judicial foreclosures
payments made therefore, the necessary and useful expenses made on
the thing sold and fulfills other stipulations which may have been agreed 8. A right of redemption in cases of extra-judicial foreclosures
upon.
9. Redemption of homesteads

10. Redemption of tax sales

What is Pacto de Retro sale?
Pacto de Retro sale refers to the sale wherein the seller has the right to
repurchase the subject matter or the property being sold.The essence of
a pacto de retro sale is that the title and ownership of the property sold
transfers immediately to the vendee a retro. However it is still subject to
the resolutory condition of repurchase of the subject property by a
vendor a retro within the period agreed upon by them, or, in the absence
thereof, as provided by law or else it would vests upon the vendee a retro
absolute title and ownership over the property sold by operation of law.
What is the redemption period for pacto de retro sale?
This period applies to conventional redemption and not to those
contracts which involves a sale with a right of repurchase. The period
of redemption laid down by law is expressed in this provision:
Art. 1606. The right referred to in Article 1601, in the absence of an
express agreement, shall last four years from the date of the contract.
Should there be an agreement, the period cannot exceed ten years.
However, the vendor may still exercise the right to repurchase within
thirty days from the time final judgment was rendered in a civil action
on the basis that the contract was a true sale with right to repurchase.
(1508a)
*If there is an agreement: period agreed upon cannot exceed 10 years
and in the absence of the period, 4 years from the date of the contract.
The vendor who fails to repurchase the property within the period
agreed upon may, however, exercise the right to repurchase within 30
days from the time final judgment was rendered in a civil action on the
basis that the contract was a true sale with right of repurchase.
11. Redemption by an agricultural tenant of land sold by the
landowner
What is the time provided for the vendor a retro to redeem or
repurchase a thing?
1. If there is no agreement as to the period for redemption- 4
years from date of contract
2. If there is agreed period, it must be done within the fixed
period
3. If the parties agreed as to the period within which to
repurchase but have not fixed a definite period,- 10 years from
the date of the contract to redeem but shall not extend beyond
10 years
4. Vendor a retro may still exercise his right to redeem within 30
days from the time of the final judgment on the basis that the
contract was a true sale with right to repurchase.
What is the rules for legal redemption by co-owner?
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 of 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.
Requisites:

1. There is c-ownership

What is legal redemption? 2. There is alienation of all or any of the shares

Legal redemption is the right to be subrogated, upon the same terms 3. The sale was made to a stranger
and conditions stipulated in the contract, in the place of one who
acquires a thing by purchase or dation in payment, or by any other 4. The legal redemption was exercised before partition

1
What is the rules for legal redemption by an adjacent owner? For rural land that does not exceed one hectare, the owners or adjoining
lands may exercise the right of redemption unless the grantee/buyer
Art. 1621: The owners of adjoining lands shall also have the right of does not have any rural land.[38] The owner of the adjoining land of
redemption when a piece of rural land, the area of which does not smaller area is preferred should there be several prospective
exceed one hectare, is alienated, unless the grantee does not own any buyers.[39] If the lands have the same area, the first who requested the
rural land. redemption is preferred.[40] This right cannot be exercised on adjacent
lands which are separated by brooks, drains, ravines, roads, and other
This right is not applicable to adjacent lands which are separated by
apparent servitudes for the benefit of other estates.[41]
brooks, drains, ravines, roads and other apparent servitudes for the
benefit of other estates. Right of pre-emption of adjoining land owner
If two or more adjoining owners desire to exercise the right of If a piece of urban land bought for speculation is so small and so situated
redemption at the same time, the owner of the adjoining land of smaller that a major portion thereof cannot be used for any practical purpose
area shall be preferred; and should both lands have the same area, the within a reasonable time is about to be re-sold, the adjoining land owner
one who first requested the redemption. has a right of pre-emption at a reasonable price.[42] If the same has
already been sold, the adjoining landowner has the right of redemption
Requisites:
for a reasonable price.[43] If there are two or more who desires to
1. Both lands are rural exercise the right of pre-emption or redemption, the owner whose
intended use of the land in question appears to best justified is
2. The lands are adjacent to each other preferred.[44]
3. There is an alienation Right of pre-emption or redemption when exercised
4. The land are is less than 1 hectare The redemption may only exercise the right of legal pre-emption or
redemption within 30 days from the notice in writing by the prospective
Rights of adjacent owners:
seller, or by the seller, as the case may be.[45] The said seller is required
1. Right of pre-emption which the preferential right to buy the to accompany the deed of sale with an affidavit stating therein that he
urban land before the same is sold to a third person has given written notice thereof to all possible redemptioners;
otherwise, the Registry of Deeds will not record the deed of sale.[46]
2. In the event the urban land has been sold, the adjacent owners
have the right of redemption. Right of redemption of co-owners excludes adjoining land owners

Should there be a conflict between a co-owner and adjoining land

owners, the right of redemption of co-owners prevails and will exclude
What is the doctrine of caveat emptor (buyer beware)? the adjoining land owners.[47]

Requires the purchaser to be aware of the supposed title of the vendor

and one who buys without checking the vendors title takes all the risks
and losses consequent to such failure. The actual possession by people CONVENTIONAL REDEMPTION
other than the vendor should, at least, put the purchaser upon inquiry.
What is conventional redemption?
Site identification and survey are a must also.
Seller reserved the right to repurchase thing sold coupled with
An action for reconveyance is a legal and equitable remedy granted to
obligation to return price of the sale, expenses of contract & other
the rightful owner of land which has been wrongfully or erroneously
legitimate payments and the necessary & useful expenses made on the
registered in the name of another for the purpose of compelling the latter
thing sold Note: Right to repurchase must be reserved at the time of
to transfer or convey the land to him.
perfection of sale. (Pineda, p. 333)

Legal Redemption
LEGAL REDEMPTION
Legal redemption is the right to be subrogated, upon the same terms
What is legal redemption?
and conditions stipulated in the contract, in the place of one who
acquires a thing by purchase or dation in payment, or by any other It is the right to be subrogated upon the same terms and conditions
transaction whereby ownership is transmitted by onerous title.[34] stipulated in the contract, in the place of one who acquires the thing by
purchase or by dation in payment or by other transaction whereby
Co-owners right of redemption
ownership is transmitted by onerous title.
A co-owner may exercise the right of redemption in case the shares of
all the co-owners or of any of them, are sold to a third person.[35] The
redemption is required only to pay a reasonable one if the price of the What are the instances of legal redemption?
alienation is grossly excessive.[36] If there are two or more co-owners
desiring to exercise the right of redemption, they may only do so in 1. Sale of a co-owner of his share to a stranger (Art. 1620)
proportion to the share they may respectively have in the thing owned
in common.[37] 2. When a credit or other incorporeal right in litigation is sold (Art.
1634)
Adjoining lot owners right of redemption
3. Sale of an heir of his hereditary rights to a stranger (Art. 1088)

2
4. Sale of adjacent rural lands not exceeding 1 hectare (Art. 1621)
5. Sale of adjacent small urban lands bought merely for speculation (Art.
1622)
What is the period of redemption?
1. No period agreed upon 4 years from date of contract
2. When there is agreement should not exceed 10 years; but if it
exceeded, valid only for the first 10 years.
3. When period to redeem has expired & there has been a previous suit
on the nature of the contract seller still has 30 days from final
judgment on the basis that contract was a sale with pacto de retro:
Rationale: no redemption due to erroneous belief that it is equitable
mortgage which can be extinguished by paying the loan.
4. When period has expired & seller allowed the period of redemption
to expire seller is at fault for not having exercised his rights so should
not be granted a new period
Note: Tender of payment is sufficient but it is not in itself a payment
that relieves the seller from his liability to pay the redemption price.
When does period of redemption begin to run?
1. Right of legal pre-emption or redemption shall be exercised within
30 days from written notice by the buyer deed of sale not to be
recorded in Registry of Property unless accompanied by affidavit that
buyer has given notice to redemptioners
2. When there is actual knowledge, no need to give written notice;
period of redemption begins to run from actual knowledge
Right Of Legal Redemption
In Cabales, et al. v. CA, et al., G.R. No. 162421, August 31, 2007, a
property was the subject of co-ownership. The co-owners sold their
undivided shares in 1978 and informed the others, like Nelson, a minor
of the same in 1993. He signified his intention to redeem the subject
property during a barangay conciliation process but filed an action for
legal redemption only in 1995. Can he still exercise the right of
redemption? Why?
ANS: No, because he did it beyond the 30-day period from the time he
learned about the sale. (Art. 1088 & 1623, NCC; Alonzo v. IAC, L-
72873, May 28, 1987, 150 SCRA 259).
To require strict proof of written notice of the sale would be to
countenance an obvious false claim of lack of knowledge thereof, thus
commending the letter of the law over its purpose, i.e., the notification
of redemptioners.
There was sufficient notice of the sale to Nelson. The thirty-day
redemption period commenced in 1993, after Nelson sought the
barangay conciliation process to redeem his property. By January 12,
1995, when he filed a complaint for legal redemption and damages, it is
clear that the thirty-day period had already expired. (Cabales, et al. v.
CA, et al., G.R. No. 162421, August 31, 2007).
In Aguilar v Aguilar
Legal redemption (retracto legal de comuneros) is a privilege created
by law, partly by reason of public policy and partly for the benefit of the
redemptioner to afford him a way out of a disagreeable or inconvenient
association into which he has been thrust.[4]
With respect to redemption by co-owners, in case the share of a co-
owner is sold to a third person, the governing law is Article 1620 of the
Civil Code which provides:
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 of 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 rate.
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.
The purpose behind Article 1620 is to provide a method for terminating
the co-ownership and consolidating the dominion in one sole owner.[5]
Article 1623 of the same Code also provides:
ART. 1623. The right of legal pre-emption or redemption shall not be
exercised except within thirty days from the notice in writing by the
prospective vendee, or by the vendor, as the case may be. The deed of
sale shall not be recorded in the Registry of Property, unless
accompanied by an affidavit of the vendee that he has given written
notice thereof to all possible redemptioners.
The right of redemption of co-owners excludes that of adjoining owners.
From the above provisions, the following are the requisites for the
exercise of legal redemption: (1) There must be a co-ownership; (2) one
of the co-owners sold his right to a stranger; (3) the sale was made
before the partition of the co-owned property; (4) the right of
redemption must be exercised by one or more co-owners within a period
of thirty days to be counted from the time that he or they were notified
in writing by the vendee or by the co-owner vendor; and (5) the vendee
must be reimbursed for the price of the sale.
In this case, the sale took place in January 1989. Petitioner admits that
he has actual knowledge of the sale. However, he only asserted his right
to redeem the property in March 1995 by filing the instant complaint.
Both the trial court and the Appellate Court ruled that this was seven (7)
years late.
Petitioner, however, now contends that there being no written notice to
him of the sale by the vendee or vendor, the thirty-day redemption
period has not prescribed.
Petitioners contention lacks merit. The old rule is that a written notice
of the sale by the vendor to his co-owners is indispensable for the latter
to exercise their retracto legal de comuneros.[6] More recently,
however, we have relaxed the written notice requirement. Thus, in Si v.
Court of Appeals,[7] we ruled that a co-owner with actual notice of the
sale is not entitled to a written notice for such would be superfluous.
The law does not demand what is unnecessary.
Laches is the failure or neglect, for an unreasonable and unexplained
length of time, to do that which could or should have been done earlier
through the exercise of due diligence.[8] Otherwise stated, laches is the
negligence or omission to assert a right within a reasonable time
warranting a presumption that the party entitled to assert it has either
3
abandoned or declined to assert it.[9] Its elements are: (1) conduct on the
part of the defendant, or of one under whom he claims, giving rise to the
situation for which the complaint seeks a remedy; (2) delay in asserting
the complainants rights, the complainant having had knowledge or
notice of the defendants conduct as having been afforded an opportunity
to institute a suit; (3) lack of knowledge or notice on the part of the
defendant that the complainant would assert the right in which he bases
his suit; and (4) injury or prejudice to the defendant in the event, relief
is accorded to the complainant, or the suit is not held barred.[10]
Petitioner has actual knowledge of the sale of Virgilios share to Angel
in 1989. As provided by Article 1623, he has thirty days from such
actual knowledge within which to exercise his right to redeem the
property. Inexplicably, petitioner did not take any action. He waited for
seven (7) years before filing his complaint. Definitely, such an
unexplained delay is tantamount to laches. To be sure, to uphold his
right would unduly cause injury to respondent-intervenor, a purchaser
in good faith and for value.
Moreover, by the time Senen filed Civil Case No. 95-039 for legal
redemption, his right was no longer available to him. We have held that
after a property has been subdivided and distributed among the co-
owners, the community has terminated and there is no reason to sustain
any right of pre-emption or redemption.[11]
In Conejero v CA
The court of first instance found the deed of sale to be an equitable
mortgage, and declared the plaintiffs Conejero entitled to redeem
Enrique's half interest for P34,000. Upon appeal by the defendants, the
Court of Appeals reversed the decision of the court of first instance,
found that the deed in favor of the Raffians was a true sale, and
declared as follows:
The pertinent provision of the law reads:
"The right of legal re-emption or redemption shall not be exercised
except within thirty days from the notice in writing by the prospective
vendor, or by the vendor, as the case may be. The deed of sale shall not
be recorded in the Registry of Property, unless accompanied by an
affidavit of the vendor that he has given written notice thereof to all
possible redemptioners.
"The right of redemption of co-owners excludes that of adjoining
owners" (Art. 1623).
Appellants claim appellees denying that a written notice of the
sale had been sent to the latter. We will concede that the evidence does
not sufficiently show that a written notice was in fact given to the
appellees; but this point is not decisive for the reason that ultimately,
according to appellees, themselves, they came to know of the sale on
August 19, 1952, on which date they immediately made an offer to
redeem the property. Appellees argue that their offer to redeem the
property on the first day they came to know of the sale on August 19,
1952, and subsequently on September 7 and 8, 1952, has preserved their
right of legal redemption as the 30-day period provided for by law had
not lapsed. On the other hand, the appellants claim that as early as April
3, 1951, the date of the absolute sale of the property by Enrique Torres
in favor of the Raffians, the appellees already know of the sale, so that
when the offer to redeem was made on August 19, 1952, the 30-day
period provided by law had already lapsed. Taken together, all the
circumstances we find in the case indeed will guide us into forming the
conclusion that while appellees might not have received a written notice
they could not have failed to have actual and personal knowledge of the
sale much earlier than August 19, 1952. But in view of our opinion
directed at another phase of the question involved, we will not rule on
their respective claims as to whether or not there was notice within the
30-day period. To us, this point is inconsequential.
Under the circumstances, what is more substantial and decisive is
was there a valid and effective offer to redeem? The law grants unto the
co-owner of a property the right of redemption. But in so granting that
right, the law intended that the offer must be valid and effective,
accompanied by an actual tender of an acceptable redemption price. In
the case at bar, the evidence shows that the appellees had offered only
P10,000.00 in check with which to redeem the property with a promise
to pay the balance by means of a loan which they would apply for and
obtain from the bank. We hold that the offer was not in pursuance of a
legal and effective exercise of the right of redemption as contemplated
by law; hence, refusal of the offer on the part of the appellants is
justified. The conditions precedent for the valid exercise of the right do
not exist.
We are now asked by petitioners Conejero to reverse and set aside the
foregoing decision of the Court of Appeals, on the basis of two
propositions advanced by them, to wit: (a) that no written notice of the
sale to the Raffians having been given by Enrique Torres to his sister
and co-owner, Paz T. de Conejero, the latter's light to exercise legal
redemption has not expired, in fact, it has not even started to run; and
(b) that in legal redemption no tender of the redemption price is
required, mere demand to allow redemption being sufficient to preserve
the redemptioner's right.
With regard to the written notice, we agree with petitioners that such
notice is indispensable, and that, in view of the terms in which Article
of the Philippine Civil Code is couched, mere knowledge of the sale,
acquired in some other manner by the redemptioner, does not satisfy the
statute. The written notice was obviously exacted by the Code to remove
all uncertainty as to the sale, its terms and its validity, and to quiet any
doubts that the alienation is not definitive. The statute not having
provided for any alternative, the method of notification prescribed
remains exclusive.
Upon the other hand, Article 1623 does not prescribe any particular
form of notice, nor any distinctive method for notifying the
redemptioner. So long, therefore, as the latter is informed in writing of
the sale and the particulars thereof, the 30 days for redemption start
running, and the redemptioner has no real cause to complain. In the case
at bar, the redemptioners (now petitioners) admit that on August 19,
1952 the co-owner-vendor, Enrique Torres, showed and gave Enrique
Conejero (who was acting for and on behalf of his wife, Paz Torres) a
copy of the 1951 deed of sale in favor of respondents Raffian. The
furnishing of this copy was equivalent to the giving of written notice
required by law: it came from the vendor and made available in
writing the details and finality of the sale. In fact, as argued for the
respondents at bar, it served all the purposes of the written notice, in a
more authentic manner than any other writing could have done. As a
necessary consequence, the 30-day period for the legal redemption by
co-owner Paz Torres (retracto de comuneros) began to run its coursed
from and after August 19, 1952, ending on September 18, of the same
year.
The next query is: did petitioners effectuate all the steps required for the
redemption? We agree with the Court of Appeals that they did not, for
they failed to make a valid tender of the price of the sale paid by the
Raffians within the period fixed by law. Conejero merely offered a
check for P10,000, which was not even legal tender and which the
Raffians rejected, in lieu of the price of P28,000 recited by the deed of
4
sale. The factual finding of the Court of Appeals to this effect is final
and conclusive. Nor were the vendees obligated to accept Conejero's
promise to pay the balance by means of a loan to be obtained in
future from a bank. Bona fide redemption necessarily imports a
seasonable and valid tender of the entire repurchase price, and this was
not done. There is no cogent reason for requiring the vendee to accept
payment by installments from a redemptioner, as it would ultimately
result in an indefinite extension of the 30-day redemption period, when
the purpose of the law in fixing a short and definite term is clearly to
avoid prolonged and anti-economic uncertainty as to ownership of the
thing sold (Cf. Torrijos vs. Crisologo, et al., G.R. No. L-1773, Sept. 29,
1962).
Petitioners Conejero urge that, under the provisions of the Civil Code of
the Philippines, a valid tender of the redemption (or repurchase) price is
not required, citing De la Cruz vs. Marcelino, 84 Phil. 709, and Torio
vs. Rosario, 93 Phil. 800. Close scrutiny of these cases reveals that the
Supreme Court held therein that a judicial demand, by action
filed within the redemption period and accompanied by consignation in
Court of the redemption price, can take the place of a personal tender to
the vendee of the redemption money under the Civil Code of 1889,
because the nine-day redemption period allowed thereunder was so
short as to render it impractical that in every case the redemptioner
should be required to seek out and offer the redemption price personally
to the buyer. Under the present Civil Code, the urgency is greatly
lessened by the prolongation of the redemption period to 30 days,
instead of the 9 previously allowed; and the petitioners herein have
neither filed suit within the 30-day redemption period nor made
consignation of the price. While they received copy of the deed of sale
on August 19, 1952, complaint was only filed on October 4, 1952.
It is, likewise, argued that tender of the price is excused because Article
1620 of the new Civil Code allows the redemptioner to pay only a
reasonable price if the price of alienation is grossly excessive, and that
the reasonableness of the price to be paid can only be determined by the
courts. We think that the right of a redemptioner to pay a reasonable
price under Article 1620 does not excuse him from the duty to make
proper tender of the price that can be honestly deemed reasonable under
the circumstances, without prejudice to final arbitration by the courts;
nor does it authorize said redemptioner to demand that the vendee accept
payment by installments, as petitioners have sought to do. At any rate,
the petitioners, in making their offer to redeem, never contested the
reasonableness of the price recited in the deed of sale. In fact, they even
offered more, and were willing to pay as much as P34,000.
It is not difficult to discern why the redemption price should either be
fully offered in legal tender or else validly consigned in court. Only by
such means can the buyer become certain that the offer to redeem is one
made seriously and in good faith. A buyer can not be expected to
entertain an offer of redemption without attendant evidence that the
redemptioner can, and is willing to accomplish the repurchase
immediately. A different rule would leave the buyer open to harassment
by speculators or crackpots, as well as to unnecessary prolongation of
the redemption period, contrary to the policy of the law. While
consignation of the tendered price is not always necessary because legal
redemption is not made to discharge a pre-existing debt (Asturias Sugar
Central vs. Cane Molasses Co., 60 Phil. 253), a valid tender is
indispensable, for the reasons already stated. Of course, consignation of
the price would remove all controversy as to the redemptioner's ability
to pay at the proper time.1wph1.t
[G.R. No. L-28317. March 31, 1971.]
SANTIAGO ORTEGA, Plaintiff-Appellant, v. ANDRES ORCINE
and DOROTEO ESPLANA, Defendants-Appellees.
German G. Vilgera, for Plaintiff-Appellant.
Reyes & Dy-Liacco for Defendants-Appellees.
SYLLABUS
1. CIVIL LAW; CIVIL CODE; SPECIAL CONTRACTS; SALE;
EXTINGUISHMENT; LEGAL REDEMPTION; ADJOINING
URBAN LAND. This Court has already emphasized inprevious
cases, that an owner of urban land may not redeem an adjoining urban
property where he does not allege in his complaint, much less prove at
the trial, that the latter is so small and so situated that a major portion
thereof cannot be used for any practical purpose within a reasonable
time, having been bought merely for speculation It is evident that the
purpose of the new Civil Code in allowing redemption of adjoining
urban land is to discourage speculation in real estate and the consequent
aggravation of the housing problems in centers of population.
2. ID.; ID.; ID.; ID.; ID.; ID.; ART. 1622 NOT APPLICABLE IN CASE
AT BAR Considering that the land which appellant seeks to redeem
is 4,452 square meters in area, which is far from being "so small and so
situated that a major portion thereof cannot be used for any practical
purpose" for quite the contrary, it has been made a subdivision, and also
that it cannot be said that appellee Esplana bought the same "merely for
speculation", since in less than eight months, from March 27, 1965 when
he bought it, to December 7, 1965 when the present complaint was filed,
he had developed the same into a subdivision for re-sale, which shows
that he must have had that definite purpose in mind in buying the same,
it is Our holding that appellant cannot invoke Article 1622 of the Civil
Code, We cannot hold that such purpose is speculative.
3. STATUTORY CONSTRUCTION; "URBAN" LAND DEFINED
CASE AT BAR. It is clear to Us that the term urban in Art 1622 does
not necessarily refer to the nature of the land itself sought to be
redeemed nor to the purpose to which it is somehow devoted, but to the
character of the community or vicinity in which it is found. In this sense,
even if the land is somehow dedicated to agriculture, it is still urban, in
contemplation of this law, if it is located within the center of population
or the more or less populated portion of a city or town. In the case at
bar, in view of the facts that: (1) the land of appellant is a school site
and (2) the one in question has been filled with earth, developed and
subdivided into small lots for residential purposes, it is quite safe to
conclude that both lands are in the population section of the town and
are accordingly urban.
DECISION
BARREDO, J.:
5
 Surtida of this Court, and all the resolutions above adverted to were
made by him.

Appeal from the decision of the Court of First Instance of Camarines
Sur dismissing its civil Case No. 6043 an action filed therein by
herein appellant Santiago Ortega, owner of a parcel of land in Iriga,
Camarines Sur occupied and used as school site by the Saint Anthony
Academy, against herein appellees Andres Orcine and Doroteo Esplana,
for the purpose of enforcing an alleged right of legal redemption under
Article 1622 of the Civil Code over an adjoining 4,452-square-meter
parcel of land.
The appealed decision is one practically on the pleadings as may be
gleaned from the following pertinent portions
thereof:jgc:chanrobles.com.ph
"This case was instituted by plaintiff to enable him to redeem the
property sold by defendant Andres Orcine to his codefendant Doroteo
Esplana.
"Originally plaintiffs complaint was based on Art. 1621, New Civil
Code. Motion to dismiss was timely presented by the defendants,
opposed by the plaintiff, and this Court resolving said motion to dismiss,
issued an order dated March 3, 1966, which, among others, stated as
follows:chanrob1es virtual 1aw library
x x x
From the aforesaid decision it is indeed clear that the right of legal
redemption can be availed of only by adjoining owner if the two
adjacent lands are both rural. The absence, however, of an allegation to
that effect in the complaint will only amount to a vagueness or
uncertainty of the complaint which will entitle the defendant to ask for
a bill of particulars but not to an outright dismissal of the case.
. . . The best that the plaintiff can do is to file a complaint against the
defendant vendor to compel the latter to notify him in writing of the sale
of his land.
"It was because of that order that on March 8, 1966, defendants filed
their motion for Bill of Particulars or Motion for Clarification (p. 20,
Records), and this Court in its order dated April 21, 1966, ordered the
plaintiff.
"A pre-trial was had in the case. This time under a different Judge
Judge de la Cruz. In the order of this Court dated December 8, 1966,
Judge de la Cruz gave the defendants ten days to file a motion to dismiss
which the defendants did on December 15, 1966, and was just a
reiteration of the reasons and arguments urged on this Court in the
previous motions to dismiss, and was also denied by this Court per order
dated January 4, 1967 (p. 1, records).
"Such was the situation of this case when the undersigned presiding
Judge of this Court took over.
"This Court believes that based on the pleadings submitted in this case
by both parties, the case can be decided on the merits. The parties and
their respective counsels felt the same, that is why they agreed to have
the case set for Oral arguments before this Court and after such
argument, the same shall be submitted for decision, and no other
proceedings shall be taken on the case. (order dated July 13, 1967, pp.
83-84, Records)
"There is no dispute that the land sold to the defendant Esplana on
March 27, 1965, for P10,000.00 by his co-defendant Orcine was a
ricefield, an agricultural land (rural); that after the same was sold,
defendant Esplana had it filled with earth and then had it subdivided into
small lots for residential purposes. The land has then ceased to be rural,
and is now urban land. Likewise, the land owned by the plaintiff is
adjacent to the land in question, not separated by a creek, drain, ravines,
road and apparent servitude for the benefit of other estates, was formerly
an agricultural land (rural) but at the time of the sale made by Orcine to
Esplana on March 27, 1965, the same was already urban, and in fact,
was and is being used and occupied as school site of St. Anthony
Academy, a private school."cralaw virtua1aw library
Reversal of the dismissal is now sought by appellant upon the claim
that:jgc:chanrobles.com.ph
"I. THE LOWER COURT ERRED IN HOLDING THAT DESPITE
THE CONVERSION BY APPELLEE DOROTEO ESPLANA OF THE
LAND IN QUESTION FROM RURAL TO URBAN LAND
APPELLANT IS NOT ENTITLED TO THE RIGHT OF
REDEMPTION OR PRE-EMPTION UNDER ARTICLE 1622 OF
THE CIVIL CODE.

To be specific in his pleading as to whether or his land which adjoins "II. THE LOWER COURT ERRED IN HOLDING THAT APPELLEE
that upon which he wishes to exercise the legal right of redemption is DOROTEO ESPLANA DID NOT PURCHASE THE LAND IN
also rural, within 10 days from receipt of this order. (p. 27, Records) QUESTION FOR SPECULATIVE PURPOSE.

"Plaintiff obviously in obedience to the above order of Court, presented "III. THE LOWER COURT ERRED IN HOLDING THAT
on April 28, 1966, an Amended Complaint (pp. 28-32, Records) the APPELLANT IS NOT ENTITLED TO WRITTEN NOTICE AS
most notable change in it is that plaintiff seeks now to exercise his PROVIDED FOR UNDER ARTICLE 1623 OF THE NEW CIVIL
alleged right of legal redemption under Article 1622, (Objection to CODE."cralaw virtua1aw library
Motion to Dismiss Amended Complaint, pp. 39-40, Records) instead of
Article 1621, New Civil Code, as was his intention in the original The provisions of law involved by appellant read as
complaint. follows:jgc:chanrobles.com.ph

"Defendant presented again a motion to dismiss the amended complaint "ART. 1622. Whenever a piece of urban land which is so small and so
on exactly the same grounds as the former motion to dismiss, which situated that a major portion thereof cannot be used for any practical
likewise, was denied by this Court in its order dated June 21, 1966 (pp. purpose within a reasonable time, having been bought merely for
45-46, Records). Motion for reconsideration was equally denied by speculation, is about to be re-sold, the owner of any adjoining land has
order of this Court dated July 25, 1966 (p. 52, Records). a right of pre-emption at a reasonable price.

"All the above proceedings were had under then presiding Judge Jose "If the re-sale has been perfected, the owner of the adjoining land shall

6
have a right of redemption, also at a reasonable price.
"When two or more owners of adjoining lands wish to exercise the right
of pre-emption or redemption, the owner whose intended use of the land
in question appears best justified shall be preferred."cralaw virtua1aw
library
Appellant contends under his first assignment of error that under Article
1622, above-quoted, he has the right of legal redemption over the land
in question, since, it is not disputed that he is the owner of the urban
property adjoining said land on the North and the latter had already been
converted into urban land by appellee Esplana at the time he (appellant)
exercised his light, hence the lower court erred in holding that he is not
entitled to such right on the ground, stated by His Honor, that the time
of the sale of the said land by Orcine to Esplana on March 27, 1965, the
land sought to be redeemed and his land were not of the same kind
that of appellant being urban land while that of appellees rural. In
essence, the position of appellant is that what governs for purposes of
the redemption provided for in the law is the nature or character of the
adjoining land at the time redemption is actually sought and not at the
time of its sale to the person from whom redemption is asked.
We believe it is idle to rule in this case on appellants contention. The
legal issue he raises involves many aspects which do not appear to have
been dealt with by the parties whether in their pleadings here or in the
court below and without which it is not possible to resolve properly the
point in question. Indeed, even the question alone of what is rural and
what is urban land is itself one that is not easy to resolve. Even under
Article 1523 of the Spanish Civil Code which, incidentally, referred to
rural land only, the Spanish authorities preferred to make the needed
classification only on a case to case basis. 1 This, notwithstanding that
it was clear to them that the reason underlying the provision is to
encourage better development and utilization of agricultural lands.
According to Manresa:jgc:chanrobles.com.ph
"Limitado dicho derecho a las fincas rsticas, cuya cabida no exceda de
una hect rea, es visto que el espiritu del Cdigo no es otro que favorecer
el desarrollo de la propiedad territorial y de los intereses de la
agricultura. Una finca, cuya cabida no excede de una hect rea, no
produce, por regla general, lo suficiente para mantener a una familia: su
cultivo teniendo que transportar por entre heredades ajenas los
instrumentos de labranza, no se hace en condiciones economicas; lo
mismo puede decirse de la saca y transporte de los frutos. Todas estas
dificultades desaparecen, si al venderse la finca, la compra un
propietario que tenga tierras colindantes: se favorece de este modo el
inters pblico, porque la produccin aumenta, se atiende al inters
privado del retrayente y no es de apreciar ningn ostensible perjuicio
para el vendedor ni para el comprador." (10 Manresa, Codigo Civil
Espaol, 328.)
which reasoning was echoed by Justice Romualdez in Cortes v. Flores,
2 thus:jgc:chanrobles.com.ph
"Hallamos acertado este criterio. La intencin de la ley al conceder este
retracto es proteger la agricultura, haciendo que los terrenos agricolas
pequeos se unan a sus colindantes bajo un solo dueo para su mejor
expletacin. Si el terreno colindante con el que se trata de retraer no es
agricola, entonces es vano el retracto, no responde al propsito de la lev.
"Est ajustada a este precepto dice el Tribunal Supremo de Espaa en
su fallo de 12 de marzo de 1902, la sentencia que desestima la demanda
de retracto. cuando las dos o una sola de las fincas, son urbanas."
On the assumption then that the land in question is rural or that in legal
contemplation it continued to be such even after it was developed, for
purposes of determining appellants right of redemption, it is obvious
that since appellants land is admittedly urban, the redemption sought
cannot be allowed because it would not be in line with the above-
discussed purposes of redemption of rural land contemplated in Article
1621 of the present Civil Code. Incidentally, this provision which is
substantially Article 1523 of the Spanish Civil Code above-mentioned,
was the one firstly invoked by appellant in the trial court. Hence, the
above ruling in Cortes v. Flores is applicable to this case.
On the other hand, even on the assumption that the land in controversy
is urban, still Article 1622 of the present Civil Code which is not
invoked by appellant does not support his case. This Court has already
emphasized in previous cases, 3 that an owner of urban land may not
redeem an adjoining urban property where he does not allege in his
complaint, much less prove at the trial, that the latter is so small and so
situated that a major portion thereof cannot be used for any practical
purpose within a reasonable time, having been bought merely for
speculation. In Soriente v. Court of Appeals, 4 We
held:jgc:chanrobles.com.ph
"Said Article 1622 reads:chanrob1es virtual 1aw library
Whenever a piece of urban land which is so small and so situated that
a major portion thereof cannot be used for any practical purpose within
a reasonable time, having been bought merely for speculation, is about
to be re-sold, the owner of any adjoining land has a right of pre-emption
at a reasonable price. (Emphasis supplied.)
"This provision is not in point. It has been neither proved nor alleged,
either that the land purchased by appellant from Lamberto Reyes is so
small and so situated that a major portion thereof cannot be used for any
practical purpose, or that it has been bought merely for speculation,
or, even, that it is about to be resold. Besides, it is alleged in
appellants answer that the land sought to be redeemed by plaintiff is .
. . sufficiently big in area and so situated that the major portion or the
whole thereof can serve comfortably as workshop and storage of
machineries and equipments which defendant is putting up in the
exercise and furtherance of his profession as professional mechanical
engineer and associate electrical engineer; that in fact a portion of said
lot is actually used for residential purposes . . .; and that defendant has
no intention now or in the future to dispose of or sell the property subject
matter of the present action to any person . . .. What is more, appellee
does not context appellants evidence on these allegations. Hence, the
first two assignments of error are well taken."cralaw virtua1aw library
It may be mentioned here that the right of redemption of adjoining urban
land did not exist in the Spanish Civil Code, which confined itself to the
redemption of rural lands. It was introduced here only by the new Civil
Code. Whereas, as already observed, the objective of the right of
redemption of adjoining rural land under the old code, as adopted in the
new Civil Code, is to encourage the maximum development and
utilization of agricultural lands, it is evident that the purpose of the new
Civil Code in allowing redemption of adjoining urban land is to
discourage speculation in real estate and the consequent aggravation of
the housing problems in centers of population. As a matter of fact,
having in view this legislative purpose, We are of the opinion that
whatever difficulty may exist in determining if a land is rural for the
proper application of Article 1621, as previously noted to be the view
of Spanish authorities, no such problem arises in regard to the urban
lands contemplated in Article 1622 of the Code. It is clear to Us that the
term urban in this provision does not necessarily refer to the nature of
the land itself sought to be redeemed nor to the purpose to which it is
somehow devoted, but to the character of the community or vicinity in
7
which it is found. In this sense, even if the land is somehow dedicated
to agriculture, it is still urban, in contemplation of this law, if it is located
within the center of population or the more or less populated portion of
a city or town. 5

In the case at bar, appellant himself submits that the land in question
should be considered as urban. Actually, the facts on record do not
sufficiently show where it is situated. In view, however, of the facts that:
(1) the land of appellant is a school site and (2) the one in question has
been filled with earth, developed and subdivided into small lots for
residential purposes, it is quite safe to conclude that both lands are in
the populated section of the town and are accordingly urban.

Now, considering that the land which appellant seeks to redeem is 4,452
square meters in area, which is far from being "so small and so situated
that a major portion thereof cannot be used for any practical purpose"
for quite the contrary, it has been made a subdivision, and also that it
cannot be said that appellee Esplana bought the same "merely for
speculations" since in less than eight months, from March 27, 1965
when he bought it, to December 7, 1965 when the present complaint
was filed, he had developed the same into a subdivision for re-sale,
which shows that he must have had definite purpose in mind in buying
the same, it is Our holding that appellant cannot invoke Article 1622 of
the Civil Code. We cannot hold that such purpose is speculative. As
appellees aptly point out, according to Websters International
Dictionary to speculate means:jgc:chanrobles.com.ph

"To enter into a business transaction or venture from which the profits
or return are conjectural because the undertaking is outside of the
ordinary course of business to purchase or sell with the expectation of
profiting by anticipated, but conjectural, fluctuations in price; often in a
somewhat depreciative sense, to engage in harardous business
transaction for the chance of an unusually large profit; as to speculate in
coffee, in sugar or in bank stock." (2nd Edition p. 2417, Websters
International Dictionary.)

Consequently, all of appellants assignments of error must be as they

are hereby overruled.