Requisites | Right of Legal Redemption given to Co-owners of a co-owner selling his or her ideal share | Co-Ownership | Ownership | PROPERTY, OWNERSHIP, AND ITS MODIFICATIONS

RIGHT OF LEGAL REDEMPTION GIVEN TO CO-OWNERS OF A CO-OWNER SELLING HIS OR HER IDEAL SHARE

The right of legal redemption by co-owners is a statutory right under Philippine law that aims to preserve the co-ownership and prevent the intrusion of a third party. This is rooted in Article 1620 of the Civil Code of the Philippines, which governs the right of co-owners to redeem the ideal share of another co-owner who decides to sell their share to an outsider.

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Legal Basis

Article 1620 of the Civil Code provides:

"A co-owner of a thing may exercise the right of redemption in case the shares of all the other co-owners or any of them are sold to a third person. The redemption shall take place under the same terms stipulated in the sale, whenever the seller or sellers have not expressly notified the co-owner or co-owners of the sale. In case the notification is not made, the right shall be exercised within one month from the time the redemptioner became aware of the sale. If two or more co-owners desire to exercise the right of redemption, they may only do so in proportion to the share they may respectively have in the thing owned in common."

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Requisites for the Exercise of the Right of Legal Redemption

1. Existence of Co-Ownership

   • The property must be under a state of co-ownership at the time of the sale.
   • Co-ownership exists when the property is owned pro indiviso by two or more persons, each of whom has an ideal or fractional share in the entire property.

2. Sale of a Co-Owner’s Share to a Third Party

   • A co-owner must sell or transfer their undivided share to a third party who is not a co-owner.
   • The sale or transfer must involve the co-owner’s ideal share, not the specific portions of the property (since no co-owner owns specific parts absent partition).

3. Notification of the Co-Owners

   • The selling co-owner must provide express notification to the other co-owners regarding the terms and conditions of the sale.
   • Notification must be sufficient and made in good faith to ensure that co-owners are fully informed.

4. Right to Redeem Must Be Exercised Within the Prescriptive Period

   • If there is notification: The right must be exercised within 30 days from the time the notification is made.
   • If there is no notification: The right must be exercised within 30 days from the time the co-owner becomes aware of the sale.

5. Redemption Must Be Made on the Same Terms and Conditions as the Sale

   • The redemptioner must match the purchase price and other conditions stipulated in the contract of sale.
   • Any failure to tender the same terms results in the forfeiture of the right to redeem.

6. Proportional Exercise of Redemption Among Co-Owners

   • If more than one co-owner wants to redeem, they must divide the share being sold in proportion to their respective shares in the property.

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Procedure for the Exercise of the Right

1. Notification of Sale

   • The co-owner selling their share is obligated to notify the other co-owners, specifying:
     • The identity of the buyer.
     • The price and other conditions of the sale.

2. Exercise of Right Within the Prescriptive Period

   • The interested co-owner must formally inform the seller (or the third-party buyer) of their intent to redeem within the allowable time frame.
   • If the selling co-owner fails to notify, the redemptioner must prove when they became aware of the sale to calculate the prescriptive period.

3. Tender of Payment

   • The redemptioner must tender payment equal to the price paid by the third-party buyer and fulfill any other terms agreed upon in the sale.

4. Execution of Deed of Sale

   • Upon proper tender, the redemptioner and the seller must execute a document confirming the transfer of the co-owner’s ideal share to the redeeming co-owner.

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Key Principles and Doctrines

1. Strict Interpretation

   • The right of legal redemption is not absolute and must be strictly construed against the party asserting it. Failure to comply with any requisite forfeits the right.

2. Purpose of Redemption

   • The primary purpose is to avoid the fragmentation of the co-ownership and to preserve the relationship among co-owners.

3. Good Faith in Notification

   • A co-owner must act in good faith when notifying others of the sale. Concealment or misrepresentation can toll the prescriptive period.

4. Proportionate Redemption

   • Multiple redemptioners must divide the redeemed share in proportion to their existing interests in the co-owned property.

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Relevant Jurisprudence

1. Valdez v. Court of Appeals (G.R. No. 119022, March 29, 1999)

   • Held that failure to notify the co-owners invalidates the start of the prescriptive period until the redemptioner becomes aware of the sale.

2. Santos v. Heirs of Dominga Valdez (G.R. No. 197666, June 6, 2018)

   • Emphasized the necessity for strict compliance with the statutory requirements for valid redemption.

3. Diaz v. Intermediate Appellate Court (G.R. No. L-66574, November 14, 1988)

   • Affirmed the principle that co-owners redeeming must act in proportion to their ideal shares.

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Limitations

• The right of legal redemption cannot be exercised:
  • Against the will of the third-party buyer if all procedural and substantive requisites are met.
  • If the co-ownership ceases to exist through partition.
  • Beyond the prescriptive period, regardless of the redemptioner’s awareness of the sale.

By adhering to these principles and processes, co-owners may effectively preserve their interests in co-owned property.