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USUFRUCT

USUFRUCT

USUS (usage)
-the right to use or enjoy a thing
possessed, directly and without
altering it.
Fructus (fruit, in a figurative sense)
-the right to derive profit from a thing
possessed: for instance, by selling harvest,
renting real estate or devices, taxing for
entry

USUFRUCT

is a real right by virtue of which a person is


given 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. (Art. 562, NCC)
is a real right, of a temporary nature, which
authorizes its holder to enjoy all the benefits
which result from the normal enjoyment (or
exploitation) of anothers property, with the
obligation to return , at the designated time,
either the same thing, or in special cases, its
equivalent.

Usufruct is constituted by:

Law

Will of private persons expressed in


acts inter vivos or in a last will and
testament

By prescription

3 FUNDAMENTAL RIGHTS
APPERTAINING TO OWNERSHIP

a. jus dispodendi ( right to dispose)


b. jus utendi ( right to use)
c. jus fruendi ( right to the fruits)

JUS UTENDI + JUS FRUENDI =


USUFRUCT
JUS DISPODENDI - essence of Naked
Ownership

FORMULAE:
a.

Naked Ownership (jus dispodendi) +


Usufruct ( jus utendi, jus fruendi) =FULL
OWNERSHIP

b. Full Ownership Usufruct (utendi,


fruendi) = NAKED OWNERSHIP
(dispodendi)
c. Full Ownership Naked Ownership
(dispodendi) = USUFRUCT

CHARACTERISTICS

Essential (those without which it cannot be


termed USURUCT):
it is a real right (whether registered in the Registry of

Property or not)
it is of a temporary nature or duration (not perpetual,
otherwise it becomes emphyteusis)
its purpose is to enjoy the benefits and derive all
advantages from the object as a consequence of the
NORMAL USE or EXPLOITATION

Natural ( that which ordinarily is present, but a


contrary stipulation can eliminate it because it is
not essential)
Accidental (those which may be present or absent
depending upon the stipulation of the parties)

TWO REQUISITES OF USUFRUCT

Essential is the right to enjoy the


property of another

Accidental is the obligation of


preserving the form and substance of
the property

OBJECT OF USUFRUCT

may be real or personal property (thus, there


can be a usufruct over an automobile or over
money)
may be sterile or productive ( thus, there can
be usufruct over sterile animals) Art. 591
may be created over a right (as long as it is
not strictly personal or intransmissible, and
as long as it as independent existence)- thus,
there can be NO usufruct over an easement,
for the latter has no independent existence.

USUFRUCT v OWNERSHIP

Usufruct is limited merely to the


enjoyment of the property ( jus utendi and
jus fruendi)

Ownership has the following attributes:


the right to enjoy ( jus utendi, fruendi,

abutendi)
the right to dispose ( jus dispodendi)
the right to vindicate or recover property
( jus vindicandi)

USUFRUCT
1.As to Nature -

always a real right

LEASE
becomes a real right
only when registered

2.As to Constitution Constituted by law, By As a rule constituted


the
will of persons by Contract
expressed
in acts
inter vivos,or in a last
will and testament,
By Prescription (Art.
563, NCC)
3. As to the persons Owner
Constituting it
4. As to Extent

Includes the right to


Use, enjoy the fruits
of the
thing (jus utendi,
fruendi)

Need not be the


owner
More Limited

USUFRUCT

LEASE

5. As to Repairs

Usufructuary is
responsible for
ordinary repairs.

Lessee is Not

6. As to Taxes

Usufructuary is
Responsible for Taxes

Lessee is Not

WHO SHALL BE ENTITLED TO THE


NATURAL, INDUSTRIAL AND CIVIL
FRUITS OF THE PROPERTY IN
USUFRUCT?
General Rule : the USUFRUCTUARY.
( Art. 566 , NCC)
With respect to the hidden treasure
which may be found on the property,
he
shall be considered as
STRANGER.

SPECIAL RULES WITH RESPECT TO


NATURAL & INDUSTRIAL FRUITS
Natural and Industrial Fruits growing at the time the
usufruct begins, belong to the USUFRUCTUARY.(In
this case, such usufructuary, has no obligation to
refund to the owner the expenses INCURRED)
Those Growing at the time the Usufruct Terminates,
belong to the OWNER.
( In this case, such owner shall be obliged to
reimburse at the termination of the usufruct, from
the proceeds of the growing fruits, the ordinary
expenses of cultivation, for seed, and other similar
expenses incurred by the usufructuary). ( Art. 567,
NCC)

SPECIAL RULES WITH RESPECT TO CIVIL FRUITS


Civil fruits are deemed to accrue daily, and belong to the
usufructuary in proportion to the time the Usufruct may last ( Art.
569, NCC). Thus

if the Usufructuary has leased the property, and the usufruct


should expire before the termination of the lease, he or is heirs
shall receive only a proportionate share of the rent ( Art. 568,
NCC)
if the usufruct consist either in the right to receive;

rents
periodical pensions
interest on bonds or securities payable to the bearer
in the of enjoyment benefits accruing from the participation in any
industrial or commercial enterprise, the date of the distribution of which is
not fixed.

the foregoing, which are all considered civil fruits belong to the
usufructuary in proportion to the time the usufruct may last ( Art.
570, NCC)

WHAT ARE ABNORMAL USUFRUCTS?


Abnormal usufructs are those where the usufructuary
does not have the obligation of preserving the form and
substance of the property which is the object of the
usufruct.Thus
1. Whenever the usufruct includes things which without
being consumed, gradually deteriorate through wear
and tear, the USUFRUCTUARY shall have the right to
make use thereof in accordance with the purpose for
which they are intended and shall not be obliged to
return them at the termination of the usufruct except in
their condition at that time; BUT he shall be obliged to
indemnify the owner for any deterioration they may have
suffered by reason of his fraud or negligence. ( Art. 573,
NCC)

2. Whenever the usufruct includes things


which cannot be used without being
consumed, the usufructuary shall have
the right to make use of then under the
obligation of paying their appraised value
at the termination of the usufruct, if they
were appraised when delivered. In case
they were not appraised, he shall have
the right to return same quantity and
quality, or their current price at the time
the usufruct ceases. (Art. 574, NCC)

MAY MONEY BE THE OBJECT OF


USUFRUCT?

Answer: YES (Alunan v Veloso, 52 Phil


545)

MAY A RIGHT OF USUFRUCT BE ALIENATED, PLEDGE or


MORTGAGE?
Answer: To distinguish:
As far as Voluntary usufructs are concerned,
Undoubtedly, they can be Alienated,
sell, donate bequeath or devise..(Art. 572, NCC)
Except:
Legal Usufruct (the usufruct which parents have over the
properties of their unemancipated children, because of
their nature, it is evident that they cannot be alienated.
Usufructuary rights may likewise be Pledge or Mortgage
Except:
the Thing itself , because he does not own the thing

ART. 580
The usufructuary may set off the
improvements he may have made on
the property against any damage to
the same.

Rules:
1. Damage exceeds the value of the
improvements, usufructuary is still
liable.
2. If the value of the improvements
exceeds the damage, the difference
does not go the usufructuary, but
accrues instead in the absence of a
contrary stipulation in favor of the
naked owner, otherwise, it is as if the
usufructuary would be entitled to a
partial refund in cash.

Requisites before a set off can be


made:

Damage must have been caused by


the usufructuary

The
improvements
must
have
augmented the value of property

ART 581
The owner of the property the usufruct
of which is held by another, may
alienate it, but he cannot alter its form
or substance, or do anything thereon
which may be prejudicial to the
usufructuary.

Since the jus disponendi and the title


reside with the naked owner, he
retains the right to ALIENATE the
property BUT
a. he cannot alter its form or
substance
b. or do anything prejudicial to the
usufructuary

ART. 582.
The usufructuary of a part of a thing
held in common shall exercise all the
rights pertaining to the owner thereof
with respect to the administration and
the collection of fruits and interest.
Should the co-ownership cease by
reason of the division of the thing held
in common, the usufruct of the part
allotted to the co-owner shall belong to
the usufructuary.

In case a co-owner gives the usufruct


of his share to a person, the
usufructuary shall exercise all the
rights pertaining to the co-owner
regarding the administration and the
collection of the fruits or interest from
the property.

The right of the usufructuary is not


affected by the division but it is limited
to the fruits of said part alloted to the
co-owner.

Obligations of the
usufructuary:

before the usufruct (like the making of


inventory

during the usufruct (like taking due


care of property)

after the usufruct (like the duty to


return and indemnify in the proper
cases).

ART. 583

1.

2.

The usufructuary, before entering upon the


enjoyment of the property, is obliged:
To make, after notice to the owner or his
legitimate representative an inventory of all
the property, which shall contain an
appraisal of the movables and a description
of the condition of the immovables;
To give security, binding himself to fulfill the
obligations imposed upon him in
accordance with this Chapter.

Two obligations:
Inventory
2. Security
Requirements for the Making of the Inventory
1.

The owner or his representative must be


previously NOTIFIED.
b. The condition of the immovables must be
described.
c. The immovables must be appraised
d. As a rule, NO FORM is required except that
when there are real properties, Art 1358
demands a public instrument to affect third
parties.
a.

e. Expenses are to be borne by usufructuary,


since the duty is his
f. Effect of not making inventory(except when
excused) same as when the security is not
given.
g. When inventory is not required.
1. when no one will be injured thereby(as in
the case of usufruct over a periodical pension
or incorporeal right) provided the naked
owner consents, for the law says may.
2. in case of waiver by the naked owner or
the law, or when there is a stipulation in a
will or contract.

When security is not required:


1.
2.
3.

4.

When no one will be injured thereby


When there is waiver by the naked owner, or there
is a stipulation either in a will or by contract
When the usufructuary is the donor of the
property(who has reserved the usufruct). The
naked owner should be grateful enough not to
require the security. (Art 584)
When there is a parental usufruct (that is, in the
case of parents who are usufructuaries of their
childrens property, except when the parents
contract a second or subsequent marriage,
provided that each childs property does not
exceed P50,000 in which case, the parents have to
file a bond not as usufructuary, but as guardian or
administrator.

5. when there is a caucion juratoria,


which takes the place of a 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.

ART. 584
The provisions of No.2 of the
preceding article shall not apply to
the donor who has reserved the
usufruct of the property donated, or
to
the
parents
who
are
usufructuaries of their childrens
property, except when the parents
contracted a second marriage.

ART 585
The usufructuary, whatever may be the
title of the usufruct, may be excused
from the obligation of making an
inventory or of giving security, when no
one will be injured thereby.

When obligation to make inventory


or to give security excused

Where the naked owner renounces or


waives his right to the inventory or
security;
Where the title constituting the
usufruct relieves the usufructuary from
the obligation; and
Where the usufructuary asks that he be
exempted from the obligation and no
one will be injured thereby.

ART. 586

Should the usufructuary fail to give security in the


cases in which he is bound to give it, the owner may
demand that the immovables be placed under
administration, that the movables be sold, that the
public bonds, instruments of credit payable to order
or to bearer be converted into registered
certificates or deposited in a bank or public
institution, and that the capital or sums in cash and
the proceeds of the sale of the movable property be
invested in safe securities.
The interest on the proceeds of the sale of the
movables and that on public securities and bonds,
and the proceeds of the property placed under
administration, shall belong to the usufructuary.
Furthermore, the owner may, if he so prefers, until the
usufructuary gives security or is excused from so
doing, retain in his possession the property in
usufruct as administrator, subject to the obligation
to deliver to the usufructuary the net proceeds

Effects of Failure to Give Security


On the rights of the Naked Owner:
1. He may deliver the property to the
usufructuary
2. Or the naked owner may choose
RETENTION of the property as
ADMINISTRATOR
3. Or the naked may demand RECEIVERSHIP
or ADMINISTRATION(by another) of the
REAL PROPERTY, sale of movable,
conversion or deposit of credit
instruments, or investment of cash or
profits.

On the Rights of the Usufructuary:


1. The usufructuary cannot possess the property
till he gives the 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.

ART. 587
If the usufructuary who has not given security
claims, by virtue of a promise under oath, the
delivery of the furniture necessary for his use, and
that he and his family be allowed to live in a house
included in the usufruct, the court may grant this
petition, after due consideration of the facts of the
case.
The same rule shall be observed with respect to
implements, tools and other movable property
necessary for an industry or vocation in which he is
engaged.
If the owner does not wish that certain articles be
sold because of their artistic worth or because they
have a sentimental value, he may demand their
delivery to him upon his giving security for the
payment of the legal interest on their appraised
value.

Caucion Juratoria
The promise under oath. A sworn duty to
take good care of the property and
return 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 poor family acquires
by inheritance, the usufruct of a badly
needed house.

Requisites before the Caucion


Juratoria is allowed

Proper court petition


Necessity for delivery of furniture,
implements or house included in the
usufruct
Approval of the court
Sworn promise

ART 588
After the security has been given by
the usufructuary, he shall have a
right to all the proceeds and
benefits from the day on which, in
accordance with the title
constituting the usufruct, he
should have commenced to receive
them.

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

ART 590
A usufructuary who alienates or
leases his right of usufruct shall
answer for any damage which the
things in usufruct may suffer
through the fault or negligence of
the person who substitutes him.

ART 591
If the usufruct be constituted on a flock or herd of
livestock, the usufructuary shall be obliged to replace
with the young thereof the animals that die each year
from natural causes, or are lost due to the rapacity of
beasts of prey.
If the animals on which the usufruct is constituted should
all perish, without the fault of the usufructuary, on
account of some contagious disease or any other
uncommon event, the usufructuary shall fulfill his
obligation by delivering to the owner the remains which
may have been saved from the misfortune.
Should the herd or flock perish in part, also by accident
and without the fault of the usufructuary, the usufruct
shall continue on the part saved.
Should the usufruct be on sterile animals, it shall be
considered, with respect to its effects, as though
constituted on fungible things.

Rules in case of FRUITFUL


PRODUCTIVE Livestock

or

When there is obligation to REPLACE


1. if some animals die from natural causes;
2. or if some animals are lost due to capacity
of beasts or prey
When there is NO obligation to replace
1. if there is a total loss of the animals
because of some unexpected or unnatural loss
(contagious disease or any other uncommon
event, provided the usufructuary has no fault)
2. If there is a partial loss (under the same
conditions)

ART. 592
The usufructuary is obliged to make the
ordinary repairs needed by the thing given
in usufruct.
By ordinary repairs are understood such as
are required by the wear and tear due to
the natural use of the thing and are
indispensable for its preservation. Should
the usufructuary fail to make them after
demand by the owner, the latter may
make them at the expense of the
usufructuary.

Duty to Make Ordinary


Repairs

They are required by NORMAL or


NATURAL use.
They are needed for preservation.
They must have occured DURING the
usufruct(because those occuring
before and after the end of the
usufruct should be borne by the naked
owner).
They must have happened with or
without the fault of the usufructuary.

ART. 593
Extraordinary repairs shall be at
the expense of the owner. The
usufructuary is obliged to notify
the owner when the need for
such repairs is urgent.

ART. 594
If the owner should make the
extraordinary repairs, he shall have a
right to demand of the usufructuary the
legal interest on the amount expended
for the time that the usufruct lasts.
Should he not make them when they are
indispensable for the preservation of the
thing, the usufructuary may make them;
but he shall have a right to demand of
the owner, at the termination of the
usufruct, the increase in value which the
immovable may have acquired by reason
of the repairs.

Kinds of Extraordinary
Repairs

Caused by natural use but NOT


NEEDED for preservation
Caused by ABNORMAL or EXCEPTIONAL
circumstances and needed for
preservation
Caused by ABNORMAL or EXCEPTIONAL
circumstances but are NOT NEEDED for
preservation.

Requisites Before Usufructuary is


Allowed to Make Extraordinary Repair

There must be due notification to


naked owner of urgency.

The naked owner failed to make them.

The repair is needed for preservation

ART. 595
The owner may construct any works
and make any improvements of
which the immovable in usufruct is
susceptible, or make new
plantings thereon if it be rural,
provided that such acts do not
cause a diminution in the value of
the usufruct or prejudice the right
of the usufructuary.

Constructions, Improvements, and


Plantings by the Naked Owner
Although the property is in the possession of
the usufructuary, the owner may still
a. Construct works
b. Make improvements
c. Make new paintings (if rural)
PROVIDED:
d. The value of the usufruct is not diminished.
e. Or the right of the usufructuary is not
prejudiced.

Effect of Increase in the Value


of the Usufruct

The usufructuary profits by said


increase (for he will still be entitled to
the use and fruits thereof)
The usufructuary does not have to pay
legal interest on the improvement.
Reason: this was a VOLUNTARY act of
the naked owner.

ART 596
The payment of annual charges and
taxes and of those considered as a
lien on the fruits, shall be at the
expense of the usufructuary for all
the time that the usufruct lasts.

Charges or Taxes the


Usufructuary Must Pay
Annual charges (on the fruits)
Annual taxes on the fruits
Annual taxes on the land
Other charges
Ordinary repairs
Necessary cultivation expenses

ART 597
The taxes which, during the usufruct, may
be imposed directly on the capital, shall
be at the expense of the owner.
If the latter has paid them, the
usufructuary shall pay him the proper
interest on the sums which may have
been paid in that character; and, if the
said sums have been advanced by the
usufructuary, he shall recover the
amount thereof at the termination of the
usufruct.

RULES
If paid by the owner, he can demand
legal interest on the sum paid.
If advanced (in the meantime) by the
usufructuary, said usufructuary
1. Should be REIMBURSED by the
amount paid without legal interest
2. Is entitled to RETENTION

Usufruct over an Entire


Patrimony (Art. 598)
Applies when:
1.

The usufruct is a universal one.

2. The naked ownerhas debts or is


obliged to make periodical payments

Exceptions:
1.

When it is so stipulated; in which case


the usufructuary shall be liable for the
debt specified.

2.

When the usufruct is constituted in


fraud of creditors.
In no case shall the usufructuary

be responsible for debts exceeding


the benefits under the usufruct
(except when contrary appears).

Rules on Usufruct of a
Matured Credit (Art599)

If usufructuary has given security, collection and


investment can be done without the approval of
the court or of the naked owner.

If usufructuary has not given security, or when


he is EXEMPTED or when there was only a
CAUCION JURATORIA, a collection and investment
can be done only with the approval of the court
or the naked owner.

If the credit is collected, same


belongs to
the naked owner but the usufructuary gets it
usufruct.

Usufruct shall be liable if the credit that


has been matured (due and demandable)
is not collected because of his fault or
negligence.

Usufruct on Mortgaged
Property (Art. 600)

When the usufruct is universal and some


objects are mortgaged, apply ART 598.

Usufructuary is not obliged to pay the


mortgaged obligation of the naked owner

If the usufructuary mortgaged the


usufruct himself, he is liable pay his own
debt.

NOTIFICATION BY THE
USUFRUCTUARY IS
REQUIRED IF:

EFFECT OF NONNOTIFICATION

a. If a third party commits acts


prejudicial to the rights of
ownership

a. The usufructuary is liable for


damages, as if they had been
caused thru his own fault.
(Art. 601 last part)

b. If urgent repairs are needed

b. The usufructuary cannot make


the extraordinary repairs
needed.
(Art. 594)

c. If an inventory (at the


c. The inventory can go on but
beginning of the usufruct) is to be the naked owner may later point
made
out discrepancies and omissions
in the inventory.

Extinguishment of Usufruct
1.

By the death of the usufructuary, unless


a contrary intention clearly appears.

2. By the expiration of the period for which


it was constituted or by the fulfillment of
any resolutory condition provided in the
title creating the usufruct.
3. By merger at the usufruct and ownersip
in the same person.

4. By renunciation of the usufructuary.


5. The total loss of the thing in usufruct.
6. By termination of the right of the
person.
7. By prescription

Death of Usufructuary
Exceptions:

In multiple usufructs:
It ends at the death of the last survivor

(Art. 611)

There is a period fixed based on the number of year


that would elapsed before a person would reach a
certain age

In case the contrary intention clearly appears

Expiration of the period for which it


was constituted or by fulfillment of
any resolutory condition
a. If the usufruct is on real property, or on a real
right on real property the period must be recorded
to bind third persons (Art. 709)
b. Term should not exceed 50 yrs if the
usufructuary is a juridical person (town, corporation
or association)

Exception
If the period is fixed by reference to the
life of another
Death does not affect the usufruct
and the right is transmitted to the heirs
of the usufructuary until the
expiration of the term on the fulfillment
of the condition.

Fulfillment of Resolutory
Condition

If resolutory condition imposed in the


constitution of the usufruct has
already fulfilled, the usufruct ceases.

Merger of Rights of Usufruct and


Naked Ownership in One Person

Takes place when the rights of the


usufruct and ownership are acquired by
one and the same person who
becomes the absolute owner.

Renunciation

Waiver - voluntary surrender of the rights of the usufructuary,


with intent to surrender them.

Limitations:

a. must be express:
tacit renounciation is not sufficient
b. does not need the consent of naked owner
c. if made in fraud of creditors, waiver may be rescinded
by
them through action under Art 1381(accion
pauliana)

Loss of the thing in Usufruct


a.

Loss should be total, if the loss is only


partial the usufruct will continue on
the remaining part (Art. 604)

b.

For total loss of the building whether


or not the building has been insured
(art. 607-608)

c.

For legal loss in case of appropriation


(Art. 609)

Termination of right of the


person constituting the usufruct

If the owner constituted a usufruct on


his property which he believes he
owns, and a latter person with a
superior right over the property had
established his claim and had lawfully
evicted the owner, the usufruct
terminates.

Prescription

Refers to prescription by a stranger either of the usufruct


( the usufructuary is no longer entitled to the
usufruct)
or of the naked ownership ( here, the right of the person
constituting the usufruct has been terminated) (par. 3 Art.
603)

There can be no prescription as long as the usufructuary


receives the rents from the lease of the property or he
enjoys the price of the sale of his rights.

Mere non-use by the usufructuary of the usufruct does not


terminate the usufruct, unless it is also a renunciation.

Other causes for


extinguishment of usufruct
a. Annulment
b. Rescission
c. Mutual withdrawal
d. Legal causes ending legal usufruct

Usufruct cannot be constituted in favor of a town, corporation, or association for more than 50 years.

If before the expiration of such period the

term is abandoned or the corporation or


association is dissolved the usufruct shall
be extinguished.

Article is inapplicable to
testamentary trust.

Time that may elapse before a third person attains a certain age
(Art. 606)

Usufruct subsist for the number of


years specified even if the third person
should die before the period expired.
Unless the usufruct has been
expressly granted only in consideration
of the existence of the person.

Extinction or Loss of Property


SITUATION

EFFECT

ART 607
IF DESTROYED PROPERTY IS NOT INSURED
Usufruct on BOTH building and
land (but the bulding is
destroyed in any manner
whatsoever before the
expiration of the period of the
usufruct.

The usufruct on the building is


ended, but the usufruct on land
continues.
Therefore, a usufructuary is
still entitled to the use of the
land and the use of whatever
materials of the house remain.
Also, if the naked owner wants
to rebuild but the usufructuary
refuses, it is the usufructuary
who prevails for the use of the
land is still his for the remainder
of the period.

SITUTATION

EFFECT

If the usufruct is on the building


only (but the building is
destroyed before the termination
of the period)

Usufruct continues over the land


and materials (plus interests), if
the owner does not rebuild.
If owner rebuilds, usufructuary
must allow owner to make use of
materials but the owner must pay
interest on the value of both the
land and the materials.

SITUATION

EFFECT

ART 608
If destroyed property is insured before termination the
usufruct
when insurance premium paid If owner rebuilds, usufruct
by the owner and usufructuary subsists on new building. If
(par 1)
owners does not build interest
upon insurance proceeds paid
to usufructuary.
When the insurance taken by
the naked owner only because
usufructuary refuses to
contribute to the premium.
(par 2)

Owner entitled to insurance


money (no interest paid to
usufructuary)
If he does not rebuild, usufruct
continues over remaining land
and/or money may pay interest
on value of both materials and
land. (601)
If owner rebuilds, usufruct
does not constitute on new
building but owner must pay
interest on value of land and
old materials.

SITUATION
When insurance taken by
usufructuary only depends
on value of usufructuarys
insurance interest

EFFECT
Insurance proceeds goes
to the usufructuary
No obligation to rebuild
Usufruct continues as the
land owner has no share in
insurance proceeds

RULES ON EXPROPRIATION
(Art. 609)

1. If naked owner alone was given the


indemnity he has the option:
a. to replace with equivalent thing
b. on to pay the usufructuary legal
interest on the indemnityrequires
security given by the naked owner for
the payment of the interest

2. If both the naked owner and the


usufructuary were separately given
indemnity, each owns the indemnity given
to him the usufruct being totally
extinguished.
3. If usufructuary alone was given the
indemnity, he must give it to the naked
owner and compel the latter to return
either the interest or to replace the
property. He may even deduct the interest
himself, if the naked owner fails to object.

Bad use of thing in usufruct, does not extinguish the usufruct but if
the abuse:

a. Cause considerable injury not to the thing,


but to the owner
RULE: Usufruct continues, but the naked owner can
demand delivery and administration of the thing but
he will be obliged to pay net proceeds to
usufructuary.

b. Does not cause considerable injury not to the thing, but


to the owner
RULE: Usufruct continues the naked owner cannot
demand administration by himself.

Rights and Obligation at the


termination of the Usufruct (Art. 612)
USUFRUCTUARY
must return the property
to the naked owner
to return the property till
he is reimbursed for the
taxes on capital and
indispensable
extraordinary repairs or
expenses
to remove removable
improvements or set
them offagainst
damages he has caused.

NAKED OWNER
must cancel the
security or mortgaged
must in case of rural
leases made by
usufructuary, till the
end of agricultural
year
(art. 572)
make reimbursement
to the usufructuary in
the proper cases

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