Introduction

In the Philippine legal system, a deed of donation with condition, also known as a conditional donation inter vivos, is a gratuitous transfer of property from a donor to a donee, subject to the fulfillment of specific conditions or charges imposed by the donor. This is governed primarily by the Civil Code of the Philippines (Republic Act No. 386), particularly Articles 725 to 773, which outline the nature, forms, and revocation of donations.

A conditional donation differs from a simple donation in that it includes obligations on the donee, such as using the donated property for a particular purpose (e.g., building a school on donated land) or performing certain acts. Failure to comply with these conditions can lead to revocation by the donor. However, the donee has the right to contest such revocation if they believe it is unjustified, premature, or procedurally flawed. Contesting involves judicial intervention, as unilateral revocation by the donor may not always be sufficient, especially for immovable properties requiring registration.

This article provides a comprehensive guide on contesting the revocation of a conditional deed of donation, covering legal foundations, grounds, procedures, defenses, timelines, and potential outcomes. It emphasizes the importance of consulting a licensed attorney, as outcomes depend on case-specific facts and evidence.

Legal Basis for Conditional Donations and Revocation

The Civil Code establishes the framework for donations with conditions:

Article 725 defines donation as an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another who accepts it.
Article 730 specifies that donations may be made with conditions or charges, provided they are not impossible, unlawful, or contrary to public policy.
Article 734 requires that donations of immovable property be made in a public instrument, specifying the property and any charges, and accepted in the same or another public instrument. For validity, the deed must be notarized and, for real property, registered with the Registry of Deeds.
Article 764 is central to revocation: "The donation shall be revoked at the instance of the donor, when the donee fails to comply with any of the conditions which the former imposed upon the latter. In this case, the property donated shall be returned to the donor, the alienations made by the donee and the mortgages imposed thereon by him being void, with the limitations established, with regard to third persons, by the Mortgage Law and the Land Registration laws."

Other relevant provisions include:

Article 760-763: Revocation due to subsequent birth of children, survival of presumed dead children, or adoption.
Article 765: Revocation for acts of ingratitude by the donee.
Article 769: Revocation actions are generally transmissible to the donor's heirs if the donor dies before revoking.

For conditional donations, revocation is not automatic; it requires the donor's action, and if contested, judicial determination. The Supreme Court has consistently held that donations are contracts of adhesion but must be interpreted in favor of validity unless clear non-compliance is proven.

Grounds for Revocation of a Conditional Donation

Revocation based on non-fulfillment of conditions is the most common for deeds with conditions. Key grounds include:

Non-Compliance with Imposed Conditions: The donee fails to perform the required act or use the property as stipulated. For example, if land is donated on the condition that it be used for charitable purposes and the donee converts it to commercial use, revocation may be warranted.
Impossibility of Compliance After Donation: If the condition becomes impossible due to fortuitous events (force majeure), revocation may not apply if the donee is not at fault (Article 1184 on obligations).
Other Grounds Overlapping with Conditions: If the condition involves ongoing obligations, failure could intersect with ingratitude (e.g., donor specifies care for them in old age, and donee neglects this).

Not all failures justify revocation; minor or excusable non-compliance may not suffice. The condition must be resolutory (leading to revocation upon non-fulfillment) rather than suspensive (delaying effect until fulfilled).

Procedure for Revocation by the Donor

Before contesting, understand how revocation typically occurs:

Notice of Revocation: The donor sends a formal notice to the donee, citing the specific non-compliance and demanding return of the property. This is often extrajudicial but should be notarized for evidentiary purposes.
Judicial Action if Necessary: For movable property, the donor may revoke unilaterally and reclaim via replevin. For immovable property, the donor files a petition or complaint in the Regional Trial Court (RTC) for revocation, as registration affects third parties. The action is for rescission under Article 1191 (on reciprocal obligations) or specific revocation under Article 764.
Annotation and Registration: If the property is registered, the donor may annotate the revocation on the title via lis pendens during litigation.

If the donee refuses to return the property, the donor must sue within the prescriptive period.

Steps to Contest the Revocation as the Donee

As the donee, contesting revocation involves proving compliance or invalidity. Here's a step-by-step guide:

Receive and Review the Revocation Notice: Upon receiving notice, document everything. Do not surrender the property immediately; instead, respond in writing disputing the claims, providing evidence of compliance.
Gather Evidence:
- Proof of fulfillment: Receipts, photos, witness statements, or reports showing the condition was met.
- Deed of donation copy, highlighting the exact condition.
- Correspondence with the donor.
- Expert opinions if the condition involves technical matters (e.g., construction quality).
- Evidence of excusable delay or impossibility (e.g., government permits delayed due to pandemic).
Consult Legal Counsel: Engage a lawyer specializing in property law. They can assess if the revocation is premature (e.g., if the condition has a future deadline) or if the donor waived the condition implicitly.
File a Judicial Action:
- Venue and Jurisdiction: File in the RTC where the property is located (for real property) or where the parties reside (for personal property). The action could be:
  - Declaratory Relief (Rule 63, Rules of Court): To declare the donation valid and revocation invalid.
  - Annulment of Revocation: If revocation was unilateral and improper.
  - Quiet Title or Recovery of Possession: If the donor attempts to repossess.
  - Counterclaim: If the donor sues first, file a counterclaim asserting compliance.
- Pleading Requirements: The complaint must allege facts showing compliance or invalid revocation, attach the deed and evidence, and pray for injunction to prevent enforcement of revocation.
- Filing Fees: Based on the property's assessed value; indigent litigants may apply for exemption.
Preliminary Remedies:
- Seek a Temporary Restraining Order (TRO) or Preliminary Injunction (Rule 58) to halt the donor's repossession or annotation on the title.
- If property is at risk, file for replevin if you hold possession.
Trial and Evidence Presentation:
- Pre-trial: Attempt mediation via court-annexed mediation.
- Trial: Present witnesses, documents, and arguments. The burden shifts: Donor proves non-compliance; donee rebuts.
- Defenses include:
  - Full or substantial compliance.
  - Condition was modal (purpose-oriented) and achieved in spirit.
  - Waiver by donor (e.g., through inaction or acceptance).
  - Prescription of action.
  - Laches (unreasonable delay by donor).
  - Invalid condition (illegal or impossible ab initio).
  - Donor’s bad faith or ulterior motives.
Appeal if Necessary: If the RTC rules against you, appeal to the Court of Appeals (Rule 41), then Supreme Court if involving pure questions of law.

Prescription Periods and Timelines

Timely action is crucial:

For Revocation Due to Non-Compliance: The action prescribes in 10 years from the time the cause of action accrues (i.e., when non-compliance becomes evident) under Article 1144 (written contracts).
General Rule for Donations: Article 769 allows heirs to revoke if donor dies, but within limits.
Ingratitude: 1 year from knowledge (Article 769).
Birth of Child/Adoption: 5 years from event (Article 763).

As donee, raise prescription as a defense if the donor delays unduly.

Consequences and Remedies

If Contest Succeeds: The donation remains valid; court may order removal of any annotations and award damages for wrongful revocation (e.g., moral damages under Article 2217).
If Fails: Property reverts to donor; donee returns it with fruits/income from revocation date, minus improvements (Article 764). Third-party acquirers in good faith may be protected.
Costs and Damages: Losing party pays costs; attorney's fees if stipulated or bad faith proven.
Tax Implications: Revocation may trigger donor's tax reassessment or capital gains tax if property appreciated.

Practical Considerations and Tips

Documentation: Always keep meticulous records of compliance to preempt disputes.
Alternative Dispute Resolution: Consider barangay conciliation for amicable settlement (Katarungang Pambarangay Law) if amounts are small.
Heirs' Involvement: If donor dies post-revocation, heirs may continue the action.
Public Policy: Courts favor upholding donations as acts of liberality, so strong evidence tilts in favor of the donee.
Related Laws: Intersect with Family Code (if involving family property), Property Registration Decree (PD 1529), and Tax Code (donor's tax under Section 98, NIRC).

Contesting revocation requires navigating complex civil procedure and substantive law. While this article covers the essentials, each case is unique, necessitating professional legal advice to avoid pitfalls and ensure rights are protected.