Short answer. No longer than fifty years. A usufruct constituted in favour of a town, a corporation or an association cannot run beyond that period, and it ends even sooner if the town is abandoned or the entity is dissolved before the fifty years are up. Individuals are not subject to this ceiling.
What the law says
Usufruct cannot be constituted in favor of a town, corporation, or association for more than fifty years. If it has been constituted, and before the expiration of such period the town is abandoned, or the corporation or association is dissolved, the usufruct shall be extinguished by reason thereof.
Civil Code, Article 605 — The Fifty-Year Limit for Entities. Read the full provision →
Why entities get a ceiling and people do not
A usufruct is the right to use property that belongs to someone else and to take its fruits — the rent, the harvest, the income — while ownership stays with the owner. When the usufructuary is a human being, the arrangement has a natural end: the right dies with the person. A corporation, an association or a town has no natural end. Left unchecked, a usufruct granted to such a body could strip an owner and every one of his heirs of the use of the land forever, which is close to a permanent taking without a sale. The fifty-year cap is the law's answer. It does not forbid the grant; it simply refuses to let it run indefinitely.
Dissolution or abandonment cuts it short
Fifty years is a maximum, not a guarantee. The article adds that if, before the expiration of such period the town is abandoned, or the corporation or association is dissolved, the usufruct shall be extinguished by reason thereof. The end of the entity is the end of the right. This matters in ordinary commercial life more often than people expect. A company that is wound up, struck off, or whose corporate life simply lapses without renewal cannot leave a usufruct behind as an asset for its members to keep enjoying. Owners dealing with a corporate usufructuary are entitled to check that it is still in good standing, and buyers of encumbered land should check the same thing.
What the fifty-year limit does not do
The article caps duration. It does not decide who bears repairs, who pays taxes, what happens to improvements the usufructuary built, or whether the usufruct may be transferred or leased out — those questions are answered elsewhere in the law on usufruct and, in practice, by the deed itself. Nor does the ceiling convert a shorter grant into a fifty-year one. If the deed says twenty years, twenty years is what the entity gets. And a stipulation purporting to give a corporation a usufruct in perpetuity, or for eighty years, is not cured by good intentions; the excess is simply beyond what the law allows, and the parties should expect it to be treated accordingly.
Practical points before you sign
If you are the owner, put the end date in the deed in figures rather than leaving it to be worked out later, and register the usufruct so that the term appears on the title for everyone who deals with the property afterwards. If you are the entity taking the usufruct, plan for the expiry rather than around it: a fifty-year horizon is long enough to justify serious construction and short enough that the building may outlive the right. Where the arrangement is meant to be permanent, a usufruct is the wrong instrument, and a sale, a long lease or a donation may fit better. Because the consequences run with the land and bind successors, this is worth taking advice on before signing rather than after.
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.
- National Housing Authority vs. Court of Appeals, et al, G.R. No. 148830, April 13, 2005 — read the decision on LawPhil →