Article 1632.

Should the vendor have profited by some of the fruits or received anything from the
inheritance sold, he shall pay the vendee thereof, if the contrary has not been stipulated.
FRUITS OF AN INHERITANCE IS INCLUDED THEREOF (Obligation of Vendor)
If the Vendor receives fruits, he must deliver them to the vendee;
if consumed, he must reimburse the value to the vendee
If they have been sold, the vendee must deliver the price of the sale
ARTICLE 1537
The Vendor is bound to deliver the thing sold and its accessions and accessories in the condition in
which they were upon the perfection of the contract.
All the fruits shall pertain to the vendee from the day on which the contract was perfected.
The vendee has a right to the fruits of the thing sold from the time the obligation to deliver
arises (Article 1164).
The obligation to deliver arises upon the perfection of the contract of Sale(Article 1475).
Article 1633. The Vendee shall, on his part, reimburse the vendor for all that the latter may have paid
for the debts of and charges on the estate and satisfy the credits he may have against the same,
unless there is an agreement to the contrary.
LIABILITY FOR THE DEBTS AND CHARGES ON THE ESTATE (Obligation of Vendee)
Vendor is obliged to pay the vendee the fruits or anything received from the inheritance, it is
also just that vendee be required to reimburse to vendor for whatever the latter has paid for
debts and charges on the estate.
Article 1634. When a credit or other incorporeal right in litigation is sold, the debtor shall have right to
extinguish It by reimbursing the assignee for the price the latter paid therefor, the judicial costs,
incurred by him, and the interest on the price from the day on which the same was paid.
A credit or other incorporeal right shall be considered in litigation from the time the complaint
concerning the same is answered.
The debtor may exercise his right within 30 days from the days the assignee demands payment from
him.
LEGAL REDEMPTION IN SALE OF CREDIT OR INCORPOREAL RIGHTS IN LITIGATION (Requisites)
(1) There must be a sale or assignment of a credit or other incorporeal right. The concept of sale
must be understood in its restricted sense
(2) The credit or other incorporeal right must be in litigation
(3) There must be a pending litigation at the time of assignment
(4) The assignee must have demanded payment from the debtor
(5) The debtor must reimburse the assignee the price paid by him, the judicial cost, and interest.
(6) The reimbursement must be made by the debtor within 30 days from the date the assignee
demands payment from him.
Rule: Assignment of Credit or Incorporeal Rights in litis pendencia
Assignments are deemed to be speculative in the part of the Assignee, and as much as possible, the law
would rather benefit the debtor of such credit than the one who merely speculates for profits.
Rationale: If the assignor is willing to dispose of the credit at a low price, then it should be the debtor to
benefit the bargain not the speculator.
Presumption: One who buys credit under litigation is buying for purpose of speculation.
CREDIT OR INCORPOREAL RIGHTS ARE DEEMED IN LITIGATION: if Complaint concerning the same is
answered.
Article 1635. From the provisions of the preceding article shall be excepted the assignment or sales
made:
(1) To a co-heir or co-owner if the right assigned;
(2) To creditor in payment of his credit;
(3) To the possessor of a tenement or piece of land which is subject to the right in litigation
assigned.
EXCEPTIONS TO GENERAL RULE
The right to redeem on part of debtor shall not exist with respect to the following Assignments:
(1) To a co-heir or co-owner if the right assigned;
The exception is based on desire to do away with co-ownership.
Example: A indebted to B and C in the amount of P1000
For failure to pay his debt, B sues A
B transfers his credit to C during the pendency of litigation
A cannot redeem
(2) To creditor in payment of his credit;
There is a lawful basis for the assignment as the assignee cannot be considered as vendee of a right in
litigation and as a speculator. It refers to dation en pago.
Example: A owes B the sum of P1000 and B owes C P800
If B assigns his credit against A to C then the subject of Litigation (Between A and B)
A has no right of Legal Redemption
(3) To the possessor of a tenement or piece of land which is subject to the right in litigation
assigned.
Assignee is moved by a desire to preserve the property and not to speculate at the expense of the
debtor.
Example: A owes B P1000 which is secured by a mortgage on a land owned by A
A sells the land to C and B assigns his credit in litigation against A to C
A is not entitled to redeem

Cases:
National Investment and Development Corp.vs. De Los Angeles
GR. No. L-30150 || 31 August 1971

Facts:
Spouses Roque et.al sold several lots to Del Rosario, who, after securing registration of lots under her
name, mortgaged them to Philippine Commercial and Industrial Bank (PCIB). Del Rosario failed to
complete payment of purchase price. Spouses Roque et.al filed a reconveyance against Del Rosario and
PCIB. The sale was rescinded by the court without prejudice to the Right of PCIB, which was adjudged to
be in good faith. PCIB foreclosed the property. PCIB was the highest bidder in the auction sale.
Subsequently, PCIB assigned its rights to National Investment and Development Corp.

Spouses Roque et.al filed a motion to cancel encumbrance of National Investment and Development
Corp. from the certificate of title concerned which was granted by the lower court on the ground that
the PCIB should have submitted the deed of assignment for approval of the court knowing that the
subject matter is in custodial legis and so that consent of Spouses Roque et.al could be taken.

Issue: Has a valid assignment been made by PCIB to NIDC of its rights over the lots in question

Held: Yes, there is nothing in our statutes or jurisprudence which prohibits the creditor without the
consent of the debtor from making an assignment of his credit and the rights accessory thereto; and,
certainly assignment of credit and its accessory right does not at all obliterate the obligation of debtor to
pay , but merely puts the assignee in the place of assignor.

Article 1634 definitely recognizes the likelihood that credits and other incorporeal right sin litigation may
be assigned pendent lite and, in such event, provides that the debtor may extinguish his obligation by
making appropriate reimbursement to the assignee.