Dacion en pago is the transmission of the ownership of a thing by the debtor to

Dacion en pago is the transmission of the ownership

This preview shows page 17 - 20 out of 21 pages.

Dacion en pago is the transmission of the ownership of a thing by the debtor to the creditor as the accepted equivalent of the performance of an obligation. Pacto de retro Mortgage Ownership is transferred but the ownership is subject to the condition that the seller might recover the ownership within a certain period of time. Ownership is not transferred but the property is merely subject to a charge or lien as security for the compliance of a principal obligation, usually a loan. If the seller does not repurchase the property upon the very day named in the contract, he The mortgagor does not lose his interest in the property if he fails to pay the debt at its
Image of page 17

Subscribe to view the full document.

loses all interest thereon. maturity. There is no obligation resting upon the purchaser to foreclose; neither does the vendor have any right to redeem the property after the maturity of the debt. It is the duty of the mortgagee to foreclose the mortgage if he wishes to secure a perfect title thereto, and after the maturity of the debt secured by the mortgage and before foreclosure, the mortgagor has a right to redeem [Basilio vs. Encarnacion, 5 Phil. 360] . Instances when conventional redemption is presumed to be an equitable mortgage: 1. when the price of a sale with right to repurchase is unusually inadequate; 2. when the vendor remains in possession as lessee or otherwise; 3. when upon or after the expiration of the right to repurchase another instrument extending the period of redemption or granting a new period is executed; 4. when the purchaser retains for himself a part of the purchase price; 5. when the vendor binds himself to pay the taxes on the thing sold; 6. in any other case where it may be fairly inferred the real intention of the parties is that the transaction shall secure the payment of a debt or the performance of any other obligation; and 7. when there is a doubt as to whether the contract is a contract of sale with right or repurchase or an equitable mortgage. Requisites before legal redemption can be exercised : 1 There must be a sale or assignment of credit. The concept of sale must be understood in its restricted sense. The right cannot be exercised if the transaction is exchange or donation. 2 There must be a pending litigation at the time of the assignment. The complaint by the assignor must have been filed and answered by the creditor before the sale of the credit. 3 The debtor must pay the assignee (a) the price paid by him, (b) the judicial costs incurred by him, and (c) the interests on the price from the date of payment. 4 The right must be exercised by the debtor within 30 days from the date the assignee demands (judicially or extra-judicially) payment from him. Redemption Pre-emption 1 The sale to a third person has already been perfected The sale to a third person has not yet been perfected 2 Has a much broader scope Narrower in scope – may be exercised only where there is a prospective resale of a small piece of urban land originally bought by the prospective vendor merely
Image of page 18
for speculation 3
Image of page 19

Subscribe to view the full document.

Image of page 20
  • Fall '17

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Ask Expert Tutors You can ask 0 bonus questions You can ask 0 questions (0 expire soon) You can ask 0 questions (will expire )
Answers in as fast as 15 minutes