Short answer. You can attack the transfers themselves. Article 1177 lets creditors, after pursuing the property in the debtor's possession, exercise all his rights and bring all his actions, and also impugn the acts he did to defraud them. That last clause is what reaches the giveaways.
What the law says
The creditors, after having pursued the property in possession of the debtor to satisfy their claims, may exercise all the rights and bring all the actions of the latter for the same purpose, save those which are inherent in his person; they may also impugn the acts which the debtor may have done to defraud them.
Civil Code, Article 1177 — Remedies of Creditors (Subrogatory and Rescissory Actions). Read the full provision →
The order the article imposes
Read the opening words carefully: after having pursued the property in possession of the debtor. These are secondary remedies. A creditor is expected to go first against what the debtor still visibly holds, and only when that comes up short may he reach further — into the rights the debtor himself has neglected to enforce, such as claims against his own debtors, and then into the transfers he made to put assets beyond reach. Rights inherent in the debtor's person are excluded throughout; you step into his shoes as a creditor, not as himself.
Impugning a transfer that really happened
Where the debtor genuinely conveyed property, the route is rescission. Article 1381 makes rescissible those contracts undertaken in fraud of creditors when the latter cannot in any other manner collect the claims due them, and Article 1383 confirms that the action is subsidiary — unavailable where another legal means of reparation exists. Article 1385 sets both the consequence and an important limit: rescission obliges the return of the things with their fruits and the price with its interest, and it cannot take place where the things are legally in the possession of third persons who did not act in bad faith.
Or showing the transfer was never real
Very often the property did not move at all. Article 1345 distinguishes absolute simulation, where the parties do not intend to be bound, from relative simulation, where they conceal their true agreement, and Article 1346 makes an absolutely simulated contract void. That is a different case from rescission: nothing is being unwound, because nothing was ever transferred. Which theory fits depends on a single question of fact — whether a price actually changed hands — and the answer usually lives in bank records rather than in the deed.
Move before the four years run
Article 1389 requires the action to claim rescission to be commenced within four years, so a creditor who watches a debtor strip himself for years can lose the remedy by waiting. Start collecting now: certified copies of the deeds and titles with their dates, the tax declarations, proof of what you demanded and when, evidence that the debtor kept possession or went on enjoying the property afterwards, and anything showing the transferee is a relative or paid nothing. Timing relative to your demand is the single most telling fact.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Equatorial Realty, et al. vs. Mayfair Theater, G.R. No. 106063, November 21, 1996 — read the decision on LawPhil →
- Dr. Restituto C. Buenviaje vs. Spouses Jovito R. and Lydia B. Salonga, et al, G.R. No. 216023, October 5, 2016 — read the decision on LawPhil →
- Anchor Savings Bank (formerly Anchor Finance and Investment Corporation) vs. Henry H. Furigay, et al, G.R. No. 191178, March 13, 2013 — read the decision on LawPhil →
- Carmelita Leaño, etc. vs. Court of Appeals, et al, G.R. No. 129018, November 15, 2001 — read the decision on LawPhil →
Related provisions
- Civil Code, Article 1177 — Remedies of Creditors (Subrogatory and Rescissory Actions)
- Civil Code, Article 1345 — Simulation of Contracts
- Civil Code, Article 1346 — Effect of Simulation
- Civil Code, Article 1381 — Which Contracts Are Rescissible
- Civil Code, Article 1383 — Rescission Is Subsidiary
- Civil Code, Article 1385 — Mutual Restitution; Limits
- Civil Code, Article 1389 — Prescriptive Period for Rescission