Apolinaria Austria-Magat vs. Court of Appeals (G.R. No.

106755, February 1, 2002, 375 SCRA 556)

FACTS: On December 17, 1975, Basilisa Comerciante, mother of petitioner and one of respondents, furnished a Deed of Donation to donate her house and lot to her four children (petitioner and respondent included), provided that the funeral expenses will be deducted from the total value of the lot before it is to be divided among the children. The children signed to the same deed in acceptance to the donation. That same day, they also signed into a notarized document stating that the property and the document pertaining to the same will be under the custody of the original owner (Comerciante) for as long as she lives. On February 6, 1979, Comerciante executed a Deed of Absolute Sale over the same house and lot in favor of the petitioner, prompting the respondents to file an action against the petitioner for the annulment of the deed of sale on September 21, 1983. The lower court ruled in favor of the respondent (petitioner herein), but the Court of Appeals reversed the trial court decision. CONTENTIONS: Trial Court: (1) The donation is a donation mortis causa based on the provision on the deed of donation that it would take effect upon the death of the donor. (2) The provision stating that the donor reserved the right to revoke the donation is a feature of a donation mortis causa which must comply with the formalities of a will (3) Inasmuch as the donation did not follow the formalities pertaining to wills, the same is void and produced no effect whatsoever. Hence, the sale by the donor of the said property was valid since she remained to be the absolute owner thereof during the time of the said transaction. CA: A provision in the deed of donation in question providing for the irrevocability of the donation is a characteristic of a donation inter vivos. By those words, the donor expressly renounced the right to freely dispose of the house and lot in question. The right to dispose of a property is a right essential to full ownership. Hence, ownership of the house and lot was already with the donees even during the donors lifetime. HELD: We affirm the appellate courts decision. In Cuevas v. Cuevas, we ruled that when the deed of donation provides that the donor will not dispose or take away the property donated (thus making the donation irrevocable), he in effect is making a donation inter vivos. He parts away with his naked title but maintains beneficial ownership while he lives. It remains to be a donation inter vivos despite an express provision that the donor continues to be in possession and enjoyment of the donated property while he is alive. In the Bonsato case, we held that: What is most significant [in determining the type of donation] is the absence of stipulation that the donor could revoke the donations; on the contrary, the deeds expressly declare them to be irrevocable, a quality absolutely incompatible with the idea of conveyances mortis causa where revocability is of the essence of the act, to the extent that a testator can not lawfully waive or restrict his right of revocation Appellate Court decision affirmed.

DEL ROSARIO VS. FERRER GR NO. 187056 SEPTEMBER 20, 2010 FACTS: Spouses G executed a "Donation Mortis Causa" the terms of which are as follows:

It is our will that this Donation Mortis Causa shall be irrevocable and shall be respected by the surviving spouse. It is our will that J and E will continue to occupy the portions now occupied by them.

It is further our will that this DONATION MORTIS CAUSA shall not in any way affect any other distribution of other properties belonging to any of us donors whether testate or intestate and where ever situated. It is our further will that any one surviving spouse reserves the right, ownership, possession and administration of this property herein donated and accepted and this Disposition and Donation shall be operative and effective upon the death of the DONORS. ISSUE: Whether the disposition of the property is a donation mortis causa (effective upon death), as in fact designated, or actually a donation inter vivos (effective during the lifetime of the Donors)? HELD: IT IS A DONATION INTER VIVOS. That the document in question in this case was captioned "Donation Mortis Causa" is not controlling. This Court has held that, if a donation by its terms is inter vivos, this character is not altered by the fact that the donor styles it mortis causa. In Austria-Magat v. Court of Appeals, the Court held that "irrevocability" is a quality absolutely incompatible with the idea of conveyances mortis causa, where "revocability" is precisely the essence of the act. A donation mortis causa has the following characteristics: 1. It conveys no title or ownership to the transferee before the death of the transferor; or, what amounts to the same thing, that the transferor should retain the ownership (full or naked) and control of the property while alive; 2. That before his death, the transfer should be revocable by the transferor at will, ad nutum; but revocability may be provided for indirectly by means of a reserved power in the donor to dispose of the properties conveyed; and 3. That the transfer should be void if the transferor should survive the transferee.

The Court thus said in Austria-Magat that the express "irrevocability" of the donation is the "distinctive standard that identifies the document as a donation inter vivos." Here, the donors plainly said that it is "our will that this Donation Mortis Causa shall be irrevocable and shall be respected by the surviving spouse." The intent to make the donation irrevocable becomes even clearer by the proviso that a surviving donor shall respect the irrevocability of the donation. Consequently, the donation was in reality a donation inter vivos. The donors in this case of course reserved the "right, ownership, possession, and administration of the property" and made the donation operative upon their death. But this Court has consistently held that such reservation (reddendum) in the context of an irrevocable donation simply means that the donors parted with their naked title, maintaining only

beneficial ownership of the donated property while they lived. Notably, the three donees signed their acceptance of the donation, which acceptance the deed required. This Court has held that an acceptance clause indicates that the donation is inter vivos, since acceptance is a requirement only for such kind of donations. Donations mortis causa, being in the form of a will, need not be accepted by the donee during the donor's lifetime. Finally, as Justice J. B. L. Reyes said in Puig v. Peaflorida, in case of doubt, the conveyance should be deemed a donation inter vivos rather than mortis causa, in order to avoid uncertainty as to the ownership of the property subject of the deed.

-M.V. Dollete