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USUFRUCT IN GENERAL

Art. 562
Usufruct is the right to enjoy the property of another with
the obligation of preserving its form and substance, unless the
title constituting it or the law provides otherwise; a real right
of temporary nature w/c authorizes its holder to enjoy all the
ebenfits w/c result from normal enjoyment (exploitation) of
another/s property w/ the obligation to return the same thing
at the designated time/ its equivalent (De buen)
Re use and habitation of property : provided under law on
Easement under Art. 614
Extent of Usufruct: (1) jus utendi (2)jus fruendi
- The remaining right jus disponendi (the right to
dispose) is the essence of naked ownership
- FORMULA:
Naked Ownership + Usufruct = Full Ownership
Full ownership Usufruct = Naked ownership
Full ownership Naked Ownership = Usufruct
- Theres possibility of alteration; the law or the will
of the aprties may allow the modification of the thing
which is called quasi-usufruct
- Object of Usufruct: all property, consumable things
and unproductive things

USUFRUCT EASEMENT
The object here may be real/
personal property
Involves only real property
Can be enjoyed ALL uses
and fruits of the property
Is limited to a particular use
(like the right of way)
Cannot be constituted on an
easement; but it may be
constituted on the land
burdened by an easement
May be constituted in favor
of or burdening, a piece of
land held in usufruct
Usually extinguished by the
death of usufructuary
Not extinguishjed by the
death of the owner of the
dominant estate

SIMILARITIES
- Both are real rights whether registered or not
- Both rights may be reigistered provided that the
usufruct involves real property.
- Both may be ordinarily be alienated or transmitted in
accordance w/ the formalities set by law.

BASIS USUSFRUCT LEASE
As to extent; ALL fruits and
uses
Only a particular
or specific use
As to nature of the
right;
Always a real
vright
Real right only in
the case of real
property, the lease
is REGISTERED
or is for MORE
THAN 1 YEAR,
otherwise it is only
a personal right
As to the creator
of the right;
Can be created
only by the owner
or by duly
authorized agent
The lessor may or
may not be the
owner
As to origin; May be created by
(1) law (2)contract
As a rule: only by
contract and by
(3) last will or
prescription
way of exception
by law (implied
new lease or when
builder in good
faith where land is
worth more than
the building Art.
448 )
As to cause; Owner is more or
less passice and
allows the
usufdructurary to
enjoy the thing
given in usufruct
deja gozar
Owner or lessor is
ACTIVE and he
makes the elssee
enjoy hace gozar
As to repairs; Usufructurary has
the duty to make
ordinary repairs
Lessee no duty to
pay for repairs
As to taxses; Usufructruary
pasy for annual
charges and taxes
on the fruits
Lessee pays no
taxes
As to other things; Usufructurary may
lease the property
itself to another
Lesee cannot
constitute a
usufruct on the
property leased

Art 563
Kinds as to cause
1. Legal (e.g usufruct of parents over property of
unemancipated child)
2. Voluntary created by will of parties INTER
VIVOS (e.g contract or donation) and MORTIS
CAUSA (e.g last will and testament)
3. Mixed both law and act of persons; prescription

Art 564
Other classification
1. According toquantity or extent (fruits or object)
a. As to fruits total or partial
b. As to object universal / singular / particular
2. As to number of persons enjoying the right
a. Simple if only one usufructurary enjoys
b. Multiple if several usufructuaries enjoy
i. Simultaneous
ii. Successive
3. As to quality or kind of objects involved
a. Over RIGHTS (must not be
personal/intransmissible in character)
b. Over THINGS
i. NORMAL
ii. ABNORMAL
4. According to terms and conditions
a. Pure usufruct (no term/condition)
b. With a term/period
c. With condition

Art 565
- First, the agreement of the parties or the title giving
the usufruct (thus, usufructuary may be allowed to
alienate the very thing held in usufruct although
generally , this alienation is not allowed by the codal
provisions.
- Second, in case of deficiency apply the Civil Code.
- Rule in case of conflict between the rights granted
by virtue of a will and codal provisions, the former
shall prevail.

The naked ownership of proeprties endowed to a
chaplaincy belongs to proper ecclesiastical authority within
whose jurisdiction such properties are found.


Chapter 2
RIGHTS OF THE USUFRUCTUARY

Art 566
1. To enjoy property w/ respect to its use and receipt of
its fruits
2. To administer the property in usufruct
3. With respect to the use of property, he has the right to
receive from the thing all service or benefit that it can
give
N.B He cannot however extract products w/c do not
constitute fruits because hes bound to preserve the
thing. Thus, cannot convert orchard to grazing field,
fishpond to resort :D

Dividends from share of corporation also fruits; (
they are declared out of corporate profits and not
corporate capital)
- Usufrutuary rights may be transferred, assigned or
otherwise disposed by the usufructurary.

Products which diminish capital (like stones from
stone quarry) Generally, they cannot be considered
fruits. EXCEPTION: contrary intention

Shares of usufructuary re hidden treasure -
usufructuary, not being the landowner is not entitled
as owner but is entitled as finder (to one half of the
treasure) if he really is the finder.


RIGHTS OF NAKED OWNER
GENERAL RULE: may exercise all rights consistent w/ the
enjoyment by usufructuary
- He can sell or encumber and it can be attached by
his creditors.But must not affect the rights of
usufructuary.
- Actions to protect his rights:
1. Reinvindicatory action
2. Action to remove clouds or quiet title

Art. 567

RULES

1. Fruits pending at the BEGI NNI NG of usufruct:
Belong to the usufructuary
No necessity of refunding owner for expenses
incurred
But w/o prejudice ot the right of third persons

2. Fruits pending at the TERMI NATI ON of usufruct:
Belong to the owner
But the owner must reimburse the usufructuary
for ordinary cultivation expenses and for the
seeds and similar expenses, from the proceeds of
the fruits.
Rights of innocent third parties should not be
prejudice

Art 568
- A lease executed by the owner before the creation of
the usufruct is not extinguished by usufruct.
- The rents derived from the lease of properties in
usufruct are civil fruits and they accrued form day t
day (Art 569)

Art 570
RULES AS TO CERTAIN RIGHTS (rent, pernsion,
benefits, etc.)

- Deemed to accrue proportionately to the NO and U,
for the time the usufruct lasts.
o e.g a) A gave B in usufruct the profits of a
certain factory for 10 years. If the usufruct
last really for 10 years, all profits during the
time must go to B.
- Rule when date of distribution of benefits is fixed:
Art 570 applies whether or not the date of distribution
is fixed.
- Stock dividends and cash dividends are civil fruits.
Same rule should apply to profits of a partnership.

Example with respect to Rents, If A gives B the usufruct of
As land, and As land is being rented by C, each payment of
rent shall go to B for the duration of the usufruct, each
payment being considered as part of the proceeds of the
property.
Art 571
The usufructuary shall have the right to enjoy any increase
w/c the thing in usufruct may acquire throught accession, the
servitudes established in tis favor, and in general, all benefits
inherent therein.

Increases in the thing held in usufruct aside from the
fruits:

1. Accessions (artificial or natural)
2. Servitudes and easements
3. All benefits inherent in property

Art 572
- Usufructuary may :
Rights with reference to the THING itself
(1) Personally enjoy the things
(2) May lease the thing to another (even w/o owners
consent)

Rights with reference to the USUFRUCTURARY
RIGHT itself
(1) He may alienate: usufructuary right (except legal
right), or a usufruct granted a usufructuary in
consideration of his person, or a usufruct acquired
thru caucion juratoria.
(2) He may pledge or mortagge the suufurctuary right
(because he owns said right) EXEPTION: cannot
pledge or mortagge the thing itself ; cannot sell or
alienate the thing itself or furture crops.
Parental usufruct cannot be alienated.
Right of Usufruct may be a subject of valid donation.

Effect of transfer of right the usufructuary will be liable to
owner for damages caused by fault or negligence of the
transferee or lessee

The usufruct does not terminate upon death of
transferee but upon death of the usufructuary who has
made the transfer
The usufructuary cannot alienate or dispose the
object included in usufruct

Cases when usufruct converted to right of ownership

1. When things are consumable
2. Things by their nature are intended for sales (such as
merchandise in a commercial establishment)
3. When the things, are delivered under appraisal as
equivalent to their sae

Usufructuary maysale future crop EXCEPTION:
fruits growing at the time usufruct terminates, it
belongs to the owner
Only voluntary usufructs can be alienated

Art 573- refers to Abnormal Usufruct on Things that
Deteriorate ( things that deteriorate much faster than e.g
books, vehicles, computers, etc)

- Mere deterioration thru NORMAL duty f usufruct
- NECESSARY OR ORDINARY REPAIRS
- Liability: only when usufructuary causes
deterioration by his fraud or negligence
- Effect of Deterioration on the Usufructuarys
Liability:
a) Deteriorate because of NORMAL USE: the
usufructurary is not responsible.
b) Deteriorate because of an event that
ENDANGERS THEIR PRSERVATION (
fortuitious event), still responsible.
c) Deteriorate because of FRAUD, the usufructuay
is responsible.

Art 574- refers to Usufruct over Consumable things
- Also called as Quaisi-usufruct; Converted into
simple loan
- Why? Because its substance and form is not really
preserved.
- RULES for this quasi-usufruct:
1. The usufructuary (debtor-borrower) can use them (as if
hes the owner, w/ complete right of pledge or
alienation)
2. BUT at the end of the usufruct, he must
Pay the APPRAISED value ( if appraised when
first delivered)
Or if there was no appraisal, return same kind,
quality, and quantity OR pay the price current
at the termination of the usufruct (therefor not
at the original price or value)

Art 575- Usufruct on Fruit-bearing trees and shrubs
- RIGHTS:
Can use (even for firewood, though
NOT the owner)
Dead trunks
Those cut-off or uprooted by accident
N.B: but must replace them with new
plants

Art 576- Effect of a CALAMITY on the trees and shrubs
- RIGHTS:
(1) If it is impossible/burdensome to replace them,
the option of the usufructuary are:
i. May use the trunks but should replace
them
ii. May leave the dead, fallen or uprooted
trunks at the owners disposal and
demand that the latter remove them
and clear the land
(2) If it is slightly burdensome to replace them, the
usufructuary MUST replace them and he cannot
demand clearance of the land by the owner

Art 577- Special usufruct over WOODLAND because:
Natural resources belong to the State
A license is generally essential if one desires to
gather forest products

- OBLIGATIONS OF THE USUFRUCTUARY
1. Must bear in mind that hes not the owner, hence must
see to it that the woodland is preserved either by
development or replanting. Thus, he cannot consume all,
otherwise nothing would be left for the owner.
2. In the cutting or felling of trees, he must
i. Follow the owners habit/practices
ii. In default thereof, follow the customs of the place
(as to manner, amount and season) w/o
prejudice to the owner for while he can use, he
cannot abuse.
N.B: applicable if the woodland is either a COPSE
(thicket of small trees) or TIMBER FOR
BUILDING
iii. if there be no customs, the only time the usufructuary
can cut down trees will be for repair or improvement, but
must inform the owner (although need not consent)
3. Cannot alienate the trees unless he is permitted or he
needs the money to do some repairs

In the case of coconutland, the usufruct extends
merely to the fruits produced. At any rate, it would
have been different had the naked owners approval
been obtained.

Art 578- Usufruct of an Action to recover through the courts:
i. Real property
ii. Personal property
iii. Real right over real or personal property
- The usufructuary can demand from the owner:
Authority to bring the action (usually thru SPA)
Proofs needed for recovery
- To prejudice third parties, the usufruct must either be
registered or known to them.
- Institution of the action:
The action may be instituted in the usufructuarys name
for being the owner of the usufruct, he is properly
deemed a real party in interest.

If the purpose is the recovery of the property or right, he
is still required under Art. 578 to obtain the naked
owners authority.

If the purpose is to object to or prevent disturbance over
the property , no special authority form the naked owner
is needed.

Effect of Judgment
When judgment is awarded him and he gets the property:
Its naked ownership belongs to the OWNER
Its usufruct belongs to him, he gets the fruits

Art 579 - Refers to the right to useful and luxurious
improvements

The usufructuary has the IRGHT (not the duty) to make:
i. USEFUL IMPROVEMENTS
ii. LUXURIOUS IMPROVEMENTS

But, (1) he must not alter the form or substance of the
property (2) not entitled to a REFUND but he may either
remove the improvement is no substantial damage to the
property in usufruct is caused OR set off(compensate)
the improvements against damages for which he may be
liable.

Art 580- The usufructuary may set-off the improvements

- RULES
If damage exceeds the value of improvements,
usufructuary is still liable for the difference.

If the value of improvements exceeds the damage, the
difference does not go the usufructuary, but accrues
instead in the absence of contrary stipulation in favor of
the naked owner, otherwise, it is as if the usufructuary
would be entitled to a partial refund in cash; settlement of
the difference must be agreed upon by the parties.

REQUISITES BEFORE SET OFF CAN BE MADE
The damages must have been caused by the
usufructuary
The improvements must have augmented the
value of the property

Art 581- Refers to alienation by naked owner BUT
i. He cannot alter its from / substance
ii. Or do anything prejudicial to the usufructuary

Art 582- Usufructuary of a part of common property
- A co-owner may give the usufruct of his share to
another even w/o consent of the others, UNLESS,
personal considerations are present.
- EFFECT OF PARTITION: the usufructuary
continues to have the usufruct of the part allotted to
the co-owner concerned.


OBLIGATIONS OF THE USUFRUCTUARY
Arts 583- 602

Art 583
The usufructuary before entering upon the enjoyment of
the property is obliged:
1. To make and inventory of all the property w/c shall
contain an appraisal of the movables and a description of
the condition of the immovables.
2. To give security, binding himself t fulfill the obligations
imposed upon him

Re making an inventory; not required the concurrence
of the owner in the making of the inventory. The
expenses for making the inventory are borne by the
usufructuary because it is his obligation and a
prerequisite to his entry upon the enjoyment of the
property.

When inventory not required:
1. When now one will be injured thereby;
2. In case of waiver by the naked owner or the law

Re giving security;
PURPOSE: to insure faithful compliance of the duties of
the usufructuary

When security not required,
1. When no one will be injured thereby
2. When theres waiver by the naked owner. Stipulation
3. When usufructuary is the donor of the property
4. When theres parental usufruct
5. When theres caution juratoria, w/c takes place of
the bond, and is made by taking an oath to fulfill
properly the duties of a usufructuary, BUT this is
available only under the conditions prescribed in
Art. 587 (promise under oath)

Art 584- refers to usufruct of donor or of parents

Art 585- effect if no one will be injured
- The usufructuary may be excuse from the obligation
of making an inventory or of giving security, when
no one will be injured thereby
EXCEPTIONS:
(1) Where the owner waives the giving of security or the
making of an inventory
(2) Where the title constituting the usufruct exempts the
usufructuary from any or both of these obligations
(3) Where the usufructuary asks to be relieved from
these obligations, and no one will be injured by such
exemption
Effect of failure to make an inventory, not affect rights
to enjoy but a prima facie presumption arises that the
property was received by the usufructuary in good
condition, and if hes still in possession, he may still be
required to make an inventory.

Art 586- Refers to the effects of failure to give security

On the rights of naked owner
1. He may deliver the property to the usufructuary
2. May choose RETENTION of the property as
administrator
3. Or the naked owner may demand RECEIVERSHIP
or ADMINISTRATION of the real property, sale of
movable, conversion/ deposit of credit instruments/
investment of cash or profits

On the rights of usufructuary
1. The usufructuary cannot possess the property till he
gives security
2. The usufructuary cannot administer the property,
hence, he cannot execute a lease thereon.
3. The usufructuary cannot collect credits that have
matured, nor invest them unless the Court or the
naked owner consents
4. But the usufructuary can alienate his right to the
usufruct (since failure to give the security did not
extinguish the usufruct). The grantee may of course
possess, the moment he gives security.

Retention of property by naked owner he mayw ant to
retain some of the thing in w/c he may demand their delivery
to him provided he gives security for the payment of legal
interest on their appraised value.
If the movable be sold, the cash belongs to the naked
owner but the interest thereon (6% per annum) belongs to the
usufurcturary.

Art 587- Caucion Juratoria
- The sworn undertaking refers in this article is
Caucion Juratoria; the sworn duty to take good care
of the property and return the same at the end of the
usufruct. It takes the place of the bond or security
and is based on necessity and humanity as when a
poor family requires by inheritance, the usufruct of a
badly needed house (Paras)
- Generally, the security given by the usufructuary
may be a personal bond, pledge or a mortgage.
Caucion juratoria is only the exception , upon
petition of the usufructuary and according to judicial
order.
- Restriction: he cannot alienate or lease the property
for this means he does not need them.
- When not applicable: when the usufurctuary is
exempted from giving security. Art 587 applies only
if he is required but cannot afford to give security.

Art 588
Upon giving the security, the usufructuary will be
entitled to all the benefits accruing since the time
when he should have begun to receive them
(RETROACTIVE EFFECT)

Art 589- The usufructuary shall take care of the things given
in usufruct as a good father of a family.

Art 590- Liability of usufructuary for acts of the substitute
- The usufurctuary is made liable for the acts of the
substitutes.
- Even when theres sub-usufructurary, it is still the
usufructuary who answers to the naked owner for
ordinary repairs, taxes on fruits, etc.

Art 591- Usufruct on livestock
- Applicable: when the usufruct is on a FLOCK or
HERD of livestock (not merely two or three animals)
- RULES:
When theres obligation to REPLACE,
i. If some animals die from natural causes;
ii. If some animals are lost due to rapacity of
beasts of prey
Although reason is caso fortuito, there is duty to
replace. Why? Such loss is more or less EXPECTED
or NATURAL.

When theres NO OBLIGATION to replace,
i. Total loss because of some UNEXPECTED
or UNNATURAL loss (e.g contagious
disease)
ii. Partial loss

In case of Sterile Animals,
Since there are no young (broods) here, the rule of
usufruct over fungibles applies.

Art 592- Duty of the usufructuary to make ordinary
repairs

Following conditions must be present:
They are required by normal or natural use
They are needed for preservation
Must have occurred during the usufruct
Must have happened w/ or w/o fault of the
usufructuary (If he was at fault, must pay indemnity
for damages)

EFFECT OF RNEUNCIATION
If fault of the usufructuary, he cannot exempt himse;f from
liability by renouncing the usufruct.

But if defects occasioned by the ordinary use of the thing,
the usufructuary may exempt himself from making the
repairs by returning to the owner the fruits received during
the time that defects took place.

Definition of Ordinary Repairs - those required by the
wear and tear due to the natural use of the thing abd are
indispensable for its preservation.

Art 593- Duty of the naked owner to make Extraordinary
repairs

Art 594
EXTRAORDINARY REPAIRS; KINDS
(1) Those caused by exceptional circumstances (won
they are necessary for the preservation of the thing)
(2) Those caused by the natural use of the thing, but not
necessary for its preservation

Although borne by the owner, ususfructuary
cannot compel him to make such repairs.
Who should pay extraordinary repairs
based form the above enumeration?
NAKED OWNER. Why? It is his
property.
Thus, If he makes the extraordinary repairs,
he can demand from the usufructuary the
LEGAL intrest on the amount for the
duration of the usufruct.
If Usufructuary made the ER, the ff are his
rights:
i. get increase in value or get
reimbursement of the expenses;
ii. Right of RETENTION till paid.

Art. 595 Although the property is in possession of
usufructuary, the naked owner may still:
1. Construct works;
2. Make Improvements;
3. Make new plantings

PROVIDED:
- The value of the usufruct is not diminished.
- The right of the usufructuary is not prejudiced.

Art. 596 What charges or taxes the usufructuary must pay:
1. The annual charges
2. The annual taxes on the fruits
3. The annual taxes on the land

Other charges:
1. Ordinary repairs
2. Necessary cultivation expenses.

Art 597. Taxes which are imposed directly on the capital
- E.g estate tax
- RULES:
i. If paid by the owner, he can demand legal
interest on the sum paid.
ii. If advanced by the usufructuary, his rights
are: a) REIMBURSEMENT
b)RETENTION

Art 598- when usufructuary has to pay for the debts of the
naked owner

Must distinguished if theres stipulation to pay or not. If no
stipulation, the done shall be responsible only when the
donation has been made in fraud of creditors.
- Rule when applicable: a) the usufruct is a
UNIVERSAL one b) naked owner has debts and is
obliged to make periodical payments

Art 599- Rules on Usufruct of a Matured Credit
- iIf usufructuary has givens security, collection and
investment, can be done w/o the approval of the
court or of the naked owner.
- If usufructuary has NOT given security, or when he
is EXEMPTED or when theres CAUCION
JURATORIA, collection and investment can be done
only with the approval of the court or of the naked
owner.

Art 600- Usufruct if Mortgaged Immovable (PARTICULAR
USSUFRUCT)

Art. 601 Obligation of usufructuary to notify thw
owner of any act of third person
- When notification is required:
a. If 3
rd
part commits acts prejudicial to the
ights of ownership
b. If urgent repairs are needed
c. If an inventory is to be made.
- Effect of non-notification
i. In (a) the usufurctuary is liable for damages,
as if they had been caused thru his own
fault.
ii. In (b) the usfuructuary cannot even make
the extraordinary repairs needed.
iii. In the inventory can go on, but naked
owner may later on point out discrepancies
& ommissions.

Art 602. Liability for Expenses and Costs
















EXTINGUISHMENT OF USUFRUCT

1. By the death of the usufructuary
2. By the expiration of the period
3. By merger of the usufruct anf ownership
4. By renunciation of the usufructuary
5. By the total loss of the thing in usufruct
6. By the termination of the right of the person
constituting the usufruct
7. By prescription