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Choice of Law in Property (p.301) 1. what legal system should control? 2. To what extent? If the subject in dispute involves property, important to determine whether it is movable or immovable Immovable property is regulated by the lex situs (law of the place where the property is situated) Why? It is an isolated object of rights. The connection between the interested persons is the immovable itself, not the parties Movable property: may be lex situs, lex domicilii, or lex loci actus Movables Lex domicilii- owner's domicile is used because by nature, the property is moved from place to place. Lex Situs- Country where the property is situated has sole power to decide the validity of the transactions. Also because of legitimate expectations Lex Loci Actus- the law of the place where the act occurred that gave rise to the legal claim; or has the most real connection with the transfer What does our law say? Art.414 of Civil Code: All things which are or may be the object of appropriation are considered either: Immovable or real property; or Movable or personal property Article 16: Real property and personal property are “subject to the law of the country where it is situated” -Lex situs Capacity to Transfer or Acquire Property Governed by the law of the place where the property is located (Lex Situs) Llantino v Co Liong Chong (1990) Gregorio and Llantino own commercial land in Catanduanes They leased it to Molina- then a Chinese national Llantinos claim the lease period of 13 years was to expire in 1967 But Molina- now a Filipino citizen, had constructed a commercial building with a lease contract for 60 years Llantinos now file a complant to quiet title Issue: whether Molina could sub-lease the property (considering that she was a Chinese national at the time) Ruling: What is only prohibited is leasing in excess of 50 years and preventing Filipino owner from selling the property In the contract, nothing prevents the Llantinos from disposing the property subject to the rights of Molina Even so, sale of residential land to an alien who subsequently acquires Filipino citizenship is valid. Cheeseman v IAC Thomas(American) and Criselda(Filipino) Cheesman were married in1970 but separated in 1981 Before separation, Altares conveyed unregistered land to to WIFE. Tax declarations were made only in the name of the WIFE. WIFE sold it to Padilla. HUSBAND is now suing wife and Padilla praying to annul the sale Issue: Can HUSBAND claim interest in land? Ruling: No, Padilla's rights were impaired because there was FAMEN. She is an innocent buyer for value 1973 consti disqualifies aliens from acquiring private lands By attempting to acquire interest, he violated the constitution rendering the sale as to him void. Intrinsic and Extrinic validity of conveyances The formalities of a contract to convey property are governed by Lex Situs I.e registration of title The validity and effect of conveyance of property are treated as questions of property rather than contract Exception to Lex Situs (3) 1. The transaction does not affect transfer of title to or ownership of land - the proper law is lex intentionis or lex voluntatis (law of place voluntarily selected or contracted) 2. If real property is offered as security in performing an obligation (loan) - the mortgage of the land is lex situs but the loan contract is governed by the rules of contracts 3. Testate and intestate succession and capacity to succeed are governed by national law of the decedent Liljedahl v Glassgow L held a mortgage on land in Colorado for a debt payable in Iowa. Mortgagor sold the land to Glassgow and delivered the deed. The deed had a blank space where it stated that the grantee assumed the mortgage. However, Glassgow never inserted his name before transfering it to another Iowa law says Glassgow is bound to pay but Colorado imposes no liability Other rules Policy centered approach- forum court not bound by lex situs when the situs of the movable at the time of transfer is insignificant. I.e when the chosen place is for mere convenience. Rudow v Fogel- on the issue of constructive trust of real property, the court applied the law of the domicile since both the trustor and trustee are in the same domicile Query ABC is domiciled in the US. DEF is domiciled in the Philippines ABC purchased a boat from DEF, the transaction occurred in France. The boat is harbored in Luxemberg If ABC files a complaint against DEF in the Philippines alleging that the transaction was invalid, what is the court's choice of law? summary - If the issue is about the conveyance or title to property, the Philippines follows the Lex situs rule - There are 3 exceptions to this rule - Validity and effect of conveyance of property are treated as choice of law of property (including lease), rather than choice of law of contract (see p.329)