Introduction

In the Philippine legal system, the transfer of property through donation is a common practice governed primarily by the Civil Code of the Philippines (Republic Act No. 386). Donations of immovable property, such as land, must comply with specific formalities to be valid. When a donation is made without any deed restrictions—meaning no conditions, modalities, or limitations are imposed in the deed of donation—the donee acquires full ownership rights, subject only to general legal constraints. This article explores the rights of heirs to sell such donated land, focusing on the perspectives of both the donor's heirs and the donee's heirs. It delves into the legal framework, potential implications for inheritance, collation requirements, revocation possibilities, and practical considerations, all within the Philippine context.

The absence of deed restrictions simplifies the ownership structure, but it does not eliminate overarching principles of property law, family law, and succession. Heirs may inherit or claim rights over donated land under certain circumstances, and their ability to sell it depends on the validity of the donation, the status of the donee, and compliance with inheritance laws. This comprehensive analysis covers the key aspects, drawing from statutory provisions, doctrinal interpretations, and general legal principles.

Legal Basis for Donations of Land

Formal Requirements for Validity

Under Article 748 of the Civil Code, a donation of immovable property like land must be made in a public document, specifying the property donated and the value of any charges the donee must satisfy. The acceptance by the donee must also be in a public document, either in the same instrument or a separate one, notified to the donor during their lifetime. If these formalities are not met, the donation is void.

In cases without deed restrictions, the donation is considered simple or pure, transferring absolute ownership to the donee without reversionary interests, charges, or conditions. This aligns with Article 725, which defines donation as an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another who accepts it.

Types of Donations Relevant to Land

Donations can be inter vivos (effective during the donor's lifetime) or mortis causa (effective upon the donor's death, akin to a legacy). For land without restrictions, inter vivos donations are typical, immediately vesting title in the donee upon acceptance and registration with the Register of Deeds, as required by the Property Registration Decree (Presidential Decree No. 1529).

If the donation is to a compulsory heir (e.g., children or descendants), it may be treated as an advance on their legitime (the portion of the estate reserved for compulsory heirs under Articles 886-914 of the Civil Code). However, without explicit restrictions, the donee holds the land as absolute owner.

Rights of the Donee's Heirs to Sell Donated Land

Inheritance of Donated Property

Upon the donee's death, the donated land forms part of their estate and passes to their heirs by intestate succession (Articles 960-1014) or testate succession (Articles 774-913), unless otherwise disposed of during the donee's lifetime. Since there are no deed restrictions, the donee could have sold, mortgaged, or otherwise alienated the land while alive, extinguishing any future claims by heirs.

If the land remains in the donee's estate at death, heirs acquire ownership rights proportional to their shares. They can then sell the property, provided they comply with co-ownership rules if multiple heirs are involved (Articles 493-501). For instance:

A single heir can sell their undivided share without consent from others.
To sell the entire property, all co-heirs must agree, or a partition must occur first (judicial or extrajudicial).

Process for Selling Inherited Donated Land

To sell, heirs must:

Secure a Certificate of Title in their names via extrajudicial settlement (if no will and no debts) under Rule 74 of the Rules of Court, or through probate if there's a will.
Pay estate taxes within six months of the donee's death (Section 90, National Internal Revenue Code), including any donor's tax if applicable at the time of donation (though donations are now subject to estate tax under the TRAIN Law, Republic Act No. 10963).
Register the sale with the Register of Deeds to transfer the title.

Without restrictions, there are no legal barriers to sale beyond these standard procedures. Heirs enjoy full disposition rights, as the property is free from encumbrances imposed by the original donation.

Rights of the Donor's Heirs to Challenge or Sell Donated Land

Potential Claims by Donor's Heirs

The donor's heirs may have indirect rights if the donation impairs their legitime. Under Article 909, donations to compulsory heirs are collated (brought back fictitiously into the estate) to compute the legitime. If the donation exceeds the free portion (the disposable part of the estate), it can be reduced upon the donor's death (Article 911).

However, without deed restrictions, the donation cannot be revoked for mere excess unless action is brought within the prescriptive period (generally four years from the donor's death for inofficious donations, per Article 1149). If not challenged, the donee (or their heirs) retains full title.

Donor's heirs cannot directly sell the donated land unless:

The donation is revoked for grounds under Articles 760-769 (e.g., ingratitude, birth of a child after donation, or non-fulfillment of charges—but irrelevant here since no restrictions).
The land reverts to the donor's estate via judicial action.

Collation and Its Impact

Collation ensures equality among compulsory heirs (Article 1061). For donated land without restrictions:

The value at the time of donation is collated (Article 1071).
If inofficious, the donee (or heirs) may be required to return the excess in cash or property, but not necessarily the land itself unless specified.

Donor's heirs can petition for reduction in probate proceedings, but this does not automatically grant them selling rights over the land.

Limitations and Exceptions

Prescription and Laches

Actions to revoke or reduce donations prescribe after four years (Article 1149). If donor's heirs fail to act, the donee's heirs can sell freely.

Fraud or Simulation

If the donation is simulated (e.g., to defraud creditors or heirs), it can be annulled (Articles 1409-1410). Donor's heirs may challenge it within ten years (Article 1144), potentially allowing them to include the land in the estate for sale.

Public Policy and Land Reform Laws

Even without deed restrictions, sales must comply with agrarian reform laws (e.g., Comprehensive Agrarian Reform Law, Republic Act No. 6657), which restrict sales of agricultural land to prevent circumvention of land distribution. Non-agricultural land faces fewer restrictions.

Additionally, if the land is ancestral or covered by Indigenous Peoples' Rights Act (Republic Act No. 8371), indigenous heirs may have communal rights limiting individual sales.

Tax Implications

Selling donated land triggers capital gains tax (6% of selling price or fair market value, whichever is higher) and documentary stamp tax (1.5%). Heirs must ensure donor's tax was paid originally; otherwise, penalties apply.

Case Law and Doctrinal Insights

Philippine jurisprudence emphasizes the irrevocability of perfected donations without restrictions. In De Luna v. Abrigo (G.R. No. L-57455, January 18, 1990), the Supreme Court held that simple donations transfer absolute title, barring revocation except for statutory grounds.

In Heirs of Rosales v. Rosales (G.R. No. 147147, January 16, 2003), the Court clarified that collation applies only to compulsory heirs, and reductions do not affect third-party buyers if the sale occurred after donation but before reduction.

Doctrinally, commentators like Tolentino note that absent modalities (Article 730), the donee's ownership is unqualified, extending to heirs.

Practical Considerations for Heirs

Heirs should:

Verify the deed of donation for hidden restrictions or errors.
Conduct title searches to confirm clean title.
Consult lawyers for potential collation issues.
Consider mediation for disputes among co-heirs.

In summary, without deed restrictions, donee's heirs generally have unrestricted rights to sell donated land, while donor's heirs have limited recourse through collation or revocation. This framework balances liberality in donations with protections for compulsory heirs, ensuring equitable distribution in succession.