1. The document outlines the requirements and causes of extinguishment of sales under Philippine law, including conventional and legal redemption. 2. Conventional redemption allows the vendor to reserve the right to repurchase the property, while a pacto de retro sale transfers ownership subject to the seller's right to recover it within a set time period. Failure to repurchase by the deadline voids the right. 3. Legal redemption allows co-owners or owners of adjoining land to be subrogated in the transaction under the original terms if the interest is sold to a third party. Specific rules apply depending on if the property is rural or urban.

1. Requirements:
A. Causes of Extinguishment (1600)
B. Conventional redemption (1601)
1. Nature of conventional redemption (1601)
2. When pacto de retro sale, presumed equitable mortgage (1602) - Give Examples
3. Against whom the vendor-a-retro’s right to repurchase is exercised (1612-1615)
C. Legal redemption (1619)
1. Legal redemption by co-owner (1620)
2. Legal redemption by owners of adjoining land
a. Sale of rural land (1621)
b. Sale of urban land (1622)
c. Period of legal redemption (1623)
Notes for Extinguishment of Sales
● Art. 1600. Sales are extinguished by the same causes as all other obligations, by those
stated in the preceding articles of this Title, and by conventional or legal redemption.
○ Causes for extinguishment of sales:
1. Common. Those causes which are also the means of extinguishing all
other contracts like payment, loss of the thing, condonation, etc.(see
Art.1231)
2. Special. Those causes which are recognized by the law on sales (such as
those covered by Arts.1484, 1532, 1539, 1540, 1542, 1556, 1560,1567,
and 1591)
3. Extra-special. Those causes which are given special discussion by the
Civil Code and these are conventional redemption and legal redemption
Conventional Redemption
(Arts. 1601-1618)
● Art. 1601. Conventional redemption shall take place when the vendor reserves the right
to repurchase the thing sold, with the obligation to comply with the provisions of article
1616 and other stipulations which may have been agreed upon.
○ Nature:
1. It is purely contractual because it is a right created, not by mandate of the
law, but by virtue of an express contract.
2. It is an accidental stipulation and, therefore, its nullity cannot affect the
sale itself since the latter might be entered into without said stipulation.
3. It is a real right when registered, because it binds third persons.
4. It is potestative because it depends upon the will of the vendor.
5. It is a resolutory condition because when exercised, the right of
ownership acquired by the vendee is extinguished.
6. It is not an obligation but a power or privilege that the vendor has
reserved for himself.

2. 7. It is reserved at the moment of the perfection of the contract for if the
right to repurchase is agreed upon afterwards, there is only a promise to
sell which produces different rights and effects and is governed by
Art.1479.
8. The person entitled to exercise the right of redemption necessarily is the
owner of the property sold and not any third party. The right may be
exercised also by any person in whom the right may have been transferred.
9. It gives rise to reciprocal obligation that of returning the price of sale
and other expenses, on the part of the vendor (Art.1616); and that of
delivering the property and executing a deed of sale therefor, on the part of
the vendee.
○ Pacto de Retro Sales:
❏ Both real and personal property may be the subject matter of pacto de
retro sales or sales with right to repurchase although there are certain
articles (Arts.1607, 1611, 1612, 1613, 1614, 1617, 1618) which are
applicable only to immovables.
❏ Ownership is transferred but the ownership is subject to the condition that
the seller might recover the ownership within a certain period of time.
❏ If the seller does not repurchase the property upon the very day named in
the contract, he loses all interest thereon.
❏ There is no obligation resting upon the purchaser to foreclose; neither does
the vendor have any right to redeem the property after the maturity of the
debt.
● Conventional Redemption is Presumed to be an Equitable Mortgage: (Art. 1602)
○ Instances:
■ when the price of a sale with right to repurchase is unusually inadequate
■ when the vendor remains in possession as lessee or otherwise
■ when upon or after the expiration of the right to repurchase another
instrument extending the period of redemption or granting a new period is
executed
■ when the purchaser retains for himself a part of the purchase price
■ when the vendor binds himself to pay the taxes on the thing sold
■ in any other case where it may be fairly inferred the real intention of the
parties is that the transaction shall secure the payment of a debt or the
performance of any other obligation
■ when there is a doubt as to whether the contract is a contract of sale with
right or repurchase or an equitable mortgage.
● Equitable Mortgage (Art. 1602)
○ Lacks the proper formalities, form or words, or other requisites prescribed by law
for a mortgage
○ Shows the intention of the parties to make the property subject of the contract as
security for a debt
○ Contains nothing impossible or contrary to law
● Example:
On January 1, 2301, Han agreed to sell a part of his land in Tatooine to Luke
under the agreement of Pacto de Retro. Luke bought the land for P10M and is transferred

3. to his name from Han’s. Yet under the contract Han can repurchase the land in the span
of a year. Han decided to repurchase his land from Luke for P13M but he asked Luke on
January 2, 2302. This completely voids Han’s request because he exceeded the time
period of repurchase.
● Against whom the vendor-a-retro’s right to repurchase is exercised (1612-1615)
○ Art. 1612.
■ If several persons, jointly and in the same contract, should sell an
undivided immovable with a right of repurchase, none of them may
exercise this right for more than his respective share.
■ The same rule shall apply if the person who sold an immovable alone has
left several heirs, in which case each of the latter may only redeem the part
which he may have acquired. (1514)
○ Art. 1613.
■ In the case of the preceding article, the vendee may demand of all the
vendors or co-heirs that they come to an agreement upon the repurchase of
the whole thing sold; and should that fail to do so, the vendee cannot be
compelled to consent to a partial redemption. (1515)
○ Art. 1614.
■ Each one of the co-owners of an undivided immovable who may have sold
his share separately, may independently exercise the right to repurchase as
regards his own share, and the vendee cannot compel him to redeem the
whole property. (1516)
○ Art. 1615.
■ If the vendee should leave several heirs, the actions for redemption cannot
be brought against each of them except for his own share, whether the
thing be undivided, or it has been partitioned among them.
■ But if inheritance has been divided, and the thing sold has been awarded to
one of the heirs, the action for redemption may be instituted against him
for the whole. (1517)
● Legal Redemption
○ Art. 1619.
■ Legal redemption is the right to be subrogated, upon the same terms and
conditions stipulated in the contract, in the place of one who acquires a
thing by purchase or dation in payment, or by any other transaction
whereby ownership is transmitted by onerous title. (1521a)
○ Art. 1620. (Legal Redemption by Co-Owner)
■ A co-owner of a thing may exercise the right of redemption in case the
shares of all the other co-owners or of any of them, are sold to a third
person. If the price of the alienation is grossly excessive, the redemptioner
shall pay only a reasonable one.
■ Should 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. (1522a)
○ Art. 1621. (Sale of a Rural Land)

4. ■ The owners of adjoining lands shall also have the right of redemption
when a piece of rural land, the area of which does not exceed one hectare,
is alienated, unless the grantee does not own any rural land.
■ This right is not applicable to adjacent lands which are separated by
brooks, drains, ravines, roads and other apparent servitudes for the benefit
of other estates.
■ If two or more adjoining owners desire to exercise the right of redemption
at the same time, the owner of the adjoining land of smaller area shall be
preferred; and should both lands have the same area, the one who first
requested the redemption. (1523a)
○ Art. 1622. (Sale of an Urban Land)
■ Whenever a piece of urban land which is so small and so situated that a
major portion thereof cannot be used for any practical purpose within a
reasonable time, having been bought merely for speculation, is about to be
re-sold, the owner of any adjoining land has a right of pre-emption at a
reasonable price.
■ If the re-sale has been perfected, the owner of the adjoining land shall
have a right of redemption, also at a reasonable price.
■ When two or more owners of adjoining lands wish to exercise the right of
pre-emption or redemption, the owner whose intended use of the land in
question appears best justified shall be preferred. (n)
○ Art. 1623. (Period of Legal Redemption)
■ The right of legal pre-emption or redemption shall not be exercised except
within thirty days from the notice in writing by the prospective vendor,
or by the vendor, as the case may be. The deed of sale shall not be
recorded in the Registry of Property, unless accompanied by an affidavit
of the vendor that he has given written notice thereof to all possible
redemptioners.
■ The right of redemption of co-owners excludes that of adjoining owners.
(1524a)