In all cases the attorneys fees and expenses of

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Unformatted text preview: numerous and varying fact situations presented to the courts there is a wrongful holding of property and hence a threatened unjust enrichment of the defendant."38 Constructive trusts are fictions of equity which are bound by no unyielding formula when they are used by courts as devices to remedy any situation in which the holder of the legal title may not in good conscience retain the beneficial interest.39 In constructive trusts, the arrangement is temporary and passive in which the trustee’s sole duty is to transfer the title and possession over the property to the plaintiff- beneficiary.40 Of course, the "wronged party seeking the aid of a court of equity in establishing a constructive trust must himself do equity."41 Accordingly, the court will exercise its discretion in deciding what acts are required of the plaintiff- beneficiary as conditions precedent to obtaining such decree and has the obligation to reimburse the trustee the consideration received from the latter just as the plaintiff- beneficiary would if he proceeded on the theory of rescission.42 In the good judgment of the court, the trustee may also be paid the necessary expenses he may have incurred in sustaining the property, his fixed costs for improvements thereon, and the monetary value of his services in managing the property to the extent that plaintiff- beneficiary will secure a benefit from his acts.43 The rights and obligations between the constructive trustee and the beneficiary, in this case, respondent MCIAA and petitioners over Lots Nos. 916 and 920, are echoed in Art. 1190 of the Civil Code, "When the conditions have for their purpose the extinguishment of an obligation to give, the parties, upon the fulfillment of said conditions, shall return to each other what they have received x x x x In case of the loss, deterioration or improvement of the thing, the provisions which, with respect to the debtor, are laid down in the preceding article shall be applied to the party who is bound to return x x x x" Hence, respondent MCIAA as representative of the State is obliged to reconvey Lots Nos. 916 and 920 to petitioners who shall hold the same subject to existing liens thereon, i.e., leasehold right of DPWH. In return, petitioners as if they were plaintiff- bene...
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This note was uploaded on 07/12/2013 for the course LAW 101 taught by Professor Tan during the Winter '11 term at University of the Philippines Diliman.

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