CONCEPTS

1. Pierson vs. Post, Supreme Court of New York, 3 Cai. R. 175 (1805)
Pierson v. Post

Brief Fact Summary. One man chased and pursued a fox, but another man killed it and carried it away. A dispute as to who had possession of the fox
arose.

Synopsis of Rule of Law. Mere pursuit of an animal does not give one a legal right to it.

Facts. Post and his dogs hunted, chased and pursued a fox along the beach. Pierson was aware of the chase, and he killed the fox and carried it off.
Post claimed a legal right to possession of the animal, and the lower court agreed with him

Issue. Does a person obtain possession of a wild animal by chasing it?

Held. No. Judgment reversed.

Merely finding and chasing a wild animal does not give a person possession. Even merely wounding the animal will not give right to possession. The
animal must be captured or killed in order to constitute possession.

Dissent. When a person spends his day hunting a wild animal and comes close to reasonably capturing him, another person should not be allowed to
claim possession of that animal.

Discussion. Merely pursuing a wild animal does not give rise to possession of it. Another person will have the right to capture or kill that animal.

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2. Brumagin vs. Bradshaw, 39 CAL 24 (1870)
A. FACTS:

Brumagin (P) alleged that he had been in possession of a tract of land for pasturing which was bounded by three sides by natural
boundaries and on the fourth by a wall and gate.

B. HOLDING:

Acts of ownership and dominion over land which may be sufficient to constitute an actual possession vary according to the condition, size,
and locality of tract. By such acts the party proclaims ownership over the land. One can evict a subsequent possessor who takes possession away
from him (prior possessor wins).

C. SIGNIFICANCE:

Notice alone or mere intention to possess may not be enough to give ownership. Through time, what is sufficient notice and what it
possession may change. Possession may come and go with the passage of time. For the jury to decide.

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3. Johnson vs Macintosh, 21 U.S. 543 (1823)

Brief Fact Summary. Action for ejectment for lands in the State of Illinois, in which plaintiff claims superior title under purchase and conveyance from
the certain Indian nations over defendant under a later grant from the United States.

Synopsis of Rule of Law. Discovery of land gives the exclusive right to settle, possess, and govern the new land, and the absolute title to the soil,
subject to certain rights of occupancy only in the natives.

Facts. Johnson (P) claimed title to property conveyed under two grants, one in 1773 and the other in 1775, by the chiefs of the Illinois and Piankeshaw
nations. P contends superior title because his title came directly from the Indian nations who owned the land. D claims superior title due to a direct
conveyance from the United States government. District Court held for D. P appeals.
Issue. Whether a title conveyed by the Native Americans can be recognized by the Federal Courts?

Held. No. Judgment affirmed.

Title to lands is and must be admitted to depend entirely on the law of the nation in which they lie.

Discovery of America by Great Britain gave them the exclusive right to settle, possess, and govern the new land, and the absolute title to the soil,
subject to certain rights of occupancy of the Native Indians.

By treaty between Great Britain and the United States, the powers of government, and the right to the soil, passed to the United States, subject only to
the Indian right of occupancy, and the exclusive power to extinguish that right was vested in that government which might constitutionally exercise it.

Conquest gives a title that the Courts of the conqueror cannot deny, respecting the original justice of the claim that has been successfully asserted.

Discussion. The United States holds absolute title with the exclusive right to convey land while the Native Indians only had a right of occupancy that
can be extinguished at any time. Conquest gives title that the Courts cannot deny; therefore property rights are defined by law.

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4. Carino vs. Insular Government, 41 Phil. 936 (Philippine Supreme Court Case)
In 1903, Mateo Cario filed a petition for him to be granted a certificate of title over a 40 hectare land in Baguio, Benguet. He claimed that he and his
predecessors in interest had been in possession over said parcel of land since time immemorial; that the Igorot community where the said land was
located had always considered Mateo Cario and his predecssors/ancestors as the owner of said land; that said parcel of land had been transferred to
his predecessors and unto him in accordance with the Igorot custom.

The land registration court granted his petition but the government through the Solicitor General opposed said grant on the ground that Mateo Cario
and ancestors failed to register said land during the Spanish Era. It was argued that in 1880, the Spanish government decreed that all privately held
land must be registered or else they will be reverted back to the public domain (pursuant to the regalian doctrine).

The case reached the Philippine Supreme Court. The latter ruled against Mateo Cario hence Cario further appealed to the U.S. Supreme Court.

ISSUE: Whether or not Mateo Carios should be granted.

HELD: Yes, the U.S. Supreme Court reversed the decision held by the Philippine Supreme Court. Mateo Cario cannot be deprived of his land simply
because he failed to comply with the formalities required by the Spanish law (or by a Philippine law). Carios title, which he acquired from his
ancestors predates, by more than 50 years, the establishment of the American government in the Philippines (in fact, even before the establishment of
the Spanish government in the Philippines).

The US Supreme Court also noted that even the Solicitor General admitted that the Igorots were hardly ruled by the Spanish government. That being,
it is unlikely that the Spanish government would grant land titles to the Igorots even if they will register their land under the old Spanish Law. The US
Supreme Court also ruled that to follow the stand of the Solicitor General is to deprive the land titles of the natives (not only Igorots but all native
inhabitants of the Philippine Islands). Under the Constitution: no law shall be enacted in said islands which shall deprive any person of life, liberty, or
property without due process of law, or deny to any person therein the equal protection of the laws. The term any person includes the natives (in this
case, the Igorots). All lands held under private ownership during the Spanish era shall therefore be presumed to be such. Failure to register under
Spanish Law did not revert said lands to the public domain.

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5. Carino vs Insular Government, 212 U.S. 449 (1909, US Supreme Court Case)

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6. Popov vs Hayashi (2002, California Supreme Court Case)

Facts

Babe Ruth set the Major League Baseball home run record in 1927 with 60 home runs in a season. Roger Maris broke that record in 1961, hitting 61
home runs. Mark McGwire topped Maris in 1998 with 70 home runs. In 2001, Barry Bonds broke McGwire's record. Toward the end of the 2001
season, Barry Bonds was expected to break his own record, and fans began to congregate in the areas where he was most likely to hit a home run. On
October 7, 2001, Bonds hit his 73rd home run. In the stands that day were Alex Popov (plaintiff) and Patrick Hayashi (defendant). As the ball reached
the stands, Popov was able to make contact with the ball through his glove. As the ball entered the glove, Popov was attacked by those surrounding
him, dislodging the ball. Hayashi was not involved in this attack. The ball then rolled to Hayashi, who placed it in his pocket until he was escorted by
security to a secure area in the stadium. Popov brought a suit against Hayashi for ownership of the ball.

Issues: What constitutes possession under property law?

Who owns the ball, Popov or Hayashi?

Holding: They both have an equal property interest in the ball. It is to be sold and the proceeds equally divided. Court employed Grays definition of a
caught ball, p. 78.

Rationale: Both parties have an interest since Popov was intial capturer of the ball, and Hiyashi was able to take full control of the ball because Popov
dropped it. Determining that Popov was in full possession of the ball before he was attacked is impossible, and it is unfair to Hayashi to assume that he
did, because Hayashi did no wrong. Determining that Hayashi had full possession and property rights in the ball was unfair to Popov because he made
the first contact with the ball, and was prevented from gaining full control by circumstances outside his control.

Decision: Pre-possessory right for Popov, possessory right for Hayashi

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7. Jacque v. Stenberg Homes, Inc. (1997) - Trespass

Brief Fact Summary. of the Facts: In order to deliver a mobile home, SteenBerg Homes went across the Jacques property without permission

Synopsis of Rule of Law. When nominal damages are awarded for an intentional trespass to land punitive damages may also be awarded.

Facts. Plaintiffs Lois and Harvey Jacques, an elderly couple, are very sensitive about people being on their land. The Jacques neighbors purchased a
mobile home from the defendant SteenBerg Homes. SteenBerg tried on several occasions to get permission from the Jacques to cross their land
because this was the easiest way to deliver the mobile home and they refused. On the day of delivery SteenBerg employees made an attempt to cross
the land and were stopped by the Jacques. The SteenBerg assistant manager attempting bargaining for the right to cross and they again refused. The
assistant manager subsequently told his employees I dont give a what Mr. Jacque said just get the home in there any way you can. The
employees followed that order and delivered the home across the Jacques property.

Issue. Whether punitive damages may be awarded in an intentional trespass case when the Plaintiff are only entitled to nominal damages because
there is no actual harm to their property.

Held. Yes. Punitive damages are appropriate in intentional trespass cases even if there are no actual damages. The purpose of the punitive damage in
this case is deterrence. Landowners have an interest in protecting his or her land from trespass and the United States Supreme Court has held that the
right to exclude others from his or her land is one of the most essential [] property rights. If landowners are only allowed compensation for trespass
actions that have compensatory damages it makes that right a hollow one. It does not take actual harm to a persons property for actual harm to occur
when someone intentional trespasses upon that land. An award will not be considered excessive in violation of the Due Process clause when the acts
are egregious. Here, SteenBerg was unequivocally told no, and still continued on the land. That disregard for the Jacques rights amounts to that
egregious conduct.

Discussion. Yes. Punitive damages are appropriate in intentional trespass cases even if there are no actual damages. The purpose of the punitive
damage in this case is deterrence. Landowners have an interest in protecting his or her land from trespass and the United States Supreme Court has
held that the right to exclude others from his or her land is one of the most essential [] property rights. If landowners are only allowed compensation
for trespass actions that have compensatory damages it makes that right a hollow one. It does not take actual harm to a persons property for actual
harm to occur when someone intentional trespasses upon that land. An award will not be considered excessive in violation of the Due Process clause
when the acts are egregious. Here, SteenBerg was unequivocally told no, and still continued on the land. That disregard for the Jacques rights
amounts to that egregious conduct.

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8. Lloyd Corporation v Tanner (407 U.S. 551)

Brief Fact Summary. The Respondent, Tanner (Respondent) and five others, distributed flyers to mall shoppers inviting them to a meeting protesting
the Vietnam War and the draft.

Synopsis of Rule of Law. The First and Fourteenth Amendments of the United States Constitution (Constitution) limit state action, not private property
owners. Private property is not considered public property just because the public is invited to use the property for its intended purpose.
Facts. The Petitioner, Lloyd Corp., Ltd. (Plaintiff), owns a sixty commercial tenant shopping mall including all land and buildings on a fifty acre lot.
Public streets and sidewalks bound the mall on each side. For the eight years prior to this incident, Petitioner instituted and upheld a policy strictly
forbidding the distribution of flyers (handbills) on the mall premises. On November 14, 1968, Respondent and 5 others entered the mall and began
distributing invitations to mall shoppers. This was done in a quiet and orderly fashion. However, one customer complained. As a result, mall security
told the Respondents that they were trespassing and would be arrested unless they left the premises. Respondents quietly left the premises and began
distributing their handbills from the public sidewalks and streets surrounding the mall.

Issue. Can a privately owned shopping mall prohibit the distribution of flyers and restrict an individuals freedom of speech rights when the nature of the
handouts is unrelated to the malls operations?

Held. Yes.

Logan Valley is factually distinct from the instant case. The picketing in Logan Valley involved was directly related in its purpose to the use to which
the shopping center property was being put.

It is an infringement of property rights to force a private actor to yield to an individuals First Amendment constitutional rights when alternative avenues
of communication exist.

Discussion. A person may exercise freedom of speech rights against another private entity without restriction or interference. However, a private entity
is not required to provide a forum for such an exercise.

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9. Uston v. Resorts International Hotel, Inc. 89 N.J. 163 (1982)

Brief Fact Summary. A man had a strategy for playing blackjack that helped him win. A hotel has attempted to exclude him from the blackjack tables.

Synopsis of Rule of Law. A person has a right of reasonable access to property open to the public as long as the person does not threaten the security
of the premises and its occupants and his actions do not disrupt the regular and essential operations of the premises.

Facts. Uston has a card counting strategy that increases his odds of winning at blackjack. The Resort has excluded him from playing because of his
strategy. Uston contends that there is no common law or statutory right to exclude him because of his blackjack strategy.

Issue. Does an amusement place owner have the absolute right to exclude any unwanted person from the premises?

Held. No.

When property owners open their premises to the general public in the pursuit of their own property interests, they have no right to exclude people
unreasonably. Property owners have no legitimate interest in unreasonably excluding particular members of the public when they open their premises
for public use.

Sometimes, proprietors have a duty to remove disorderly or dangerous people from the premises. Casinos may bar the disorderly, the intoxicated, and
the repetitive petty offender. If someone is not causing any of these types of distractions, then they have the right of reasonable access to the blackjack
tables.

Discussion. The right of reasonable access extends to all businesses open to the public. There is a duty to serve members of the public without
discrimination unless there is a good reason not to provide services to an individual.

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PROPERTY AND OWNERSHIP

10. Leung Yee vs. Strong Machinery (G.R. No. L-11658, February 15, 1918)
In 1913, Compania Agricola Filipina (CAF) was indebted to two personalities: Leung Yee and Frank L. Strong Machinery Co. CAF purchased some rice
cleaning machines from Strong Machinery. CAF installed the machines in a building. As security for the purchase price, CAF executed a chattel
mortgage on the rice cleaning machines including the building where the machines were installed. CAF failed to pay Strong Machinery, hence the latter
foreclosed the mortgage the same was registered in the chattel mortgage registry.

CAF also sold the land (where the building was standing) to Strong Machinery. Strong Machinery took possession of the building and the land.

On the other hand, Yee, another creditor of CAF who engaged in the construction of the building, being the highest bidder in an auction conducted by
the sheriff, purchased the same building where the machines were installed. Apparently CAF also executed a chattel mortgage in favor Yee. Yee
registered the sale in the registry of land. Yee was however aware that prior to his buying, the property has been sold in favor of Strong Machinery
evidence is the chattel mortgage already registered by Strong Machinery (constructive notice).

ISSUE: Who is the owner of the building?

HELD: The SC ruled that Strong Machinery has a better right to the contested property. Yee cannot be regarded as a buyer in good faith as he was
already aware of the fact that there was a prior sale of the same property to Strong Machinery.

The SC also noted that the Chattel Mortgage Law expressly contemplates provisions for chattel mortgages which only deal with personal properties.
The fact that the parties dealt the building as if its a personal property does not change the nature of the thing. It is still a real property. Its inscription in
the Chattel Mortgage registry does not modify its inscription the registry of real property.

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11. Standard Oil Co. vs. Jaranillo (44 Phil. 631)

The Power of the Registry of Deeds is Ministerial, and The absolute criterion to determine between real and personal property is NOT supplied by the
civil code. Parties may agree what to treat as personal property and what to treat as real property.

FACTS

On November 27, 1922, Gervasia de la Rosa was the lessee of a parcel of land situated in the City of Manila and owner of the house of really tough
materials built thereon. She executed that fine day a document in the form of a chattel mortgage, purporting to convey to Standard Oil Company of
New York (by way of mortgage) both the leasehold interest in said lot and the building.

After said document had been duly acknowledged and delivered, Standard Oil presented it to Joaquin Jaramillo, as register of deeds of the City of
Manila, for the purpose of having the same recorded in the book of record of chattel mortgages. Upon examination of the instrument, Jaramillo opined
that it was not chattel mortgage, for the reason that the interest therein mortgaged did not appear to be personal property, within the meaning of the
Chattel Mortgage Law, and registration was refused on this ground only.

Later this confusion was brought to the Supreme Court upon demurrer by Joaquin Jaramillo, register of deeds of the City of Manila, to an original
petition of the Standard Oil Company of New York, demanding a mandamus to compel the respondent to record in the proper register a document
purporting to be a chattel mortgage executed in the City of Manila by Gervasia de la Rosa, Vda. de Vera, in favor of the Standard Oil Company of New
York.

The Supreme Court overruled the demurrer, and ordered that unless Jaramillo interposes a sufficient answer to the petition for mandamus by Standard
Oil within 5 days of notification, the writ would be issued as prayed, but without costs.

ISSUE:

w/n the Registry of Deeds can determine the nature of property to be registered.

w/n the Registry of Deeds has powers beyond Ministerial discretion.

RESOLUTION:

1.Jaramillo, register of deeds, does not have judicial or quasi-judicial power to determine nature of document registered as chattel mortgage Section
198 of the Administrative Code, originally of Section 15 of the Chattel Mortgage Law (Act 1508 as amended by Act 2496), does not confer upon the
register of deeds any authority whatever in respect to the "qualification," as the term is used in Spanish law, of chattel mortgages. His duties in respect
to such instruments are ministerial only. The efficacy of the act of recording a chattel mortgage consists in the fact that it operates as constructive
notice of the existence of the contract, and the legal effects of the contract must be discovered in the instrument itself in relation with the fact of notice

2.Article 334 and 335 of the Civil Code does not supply absolute criterion on distinction between real and personal property for purpose of the
application of the Chattel Mortgage Law Article 334 and 335 of the Civil Code supply no absolute criterion for discriminating between real property and
personal property for purposes of the application of the Chattel Mortgage Law. Those articles state rules which, considered as a general doctrine, are
law in this jurisdiction; but it must not be forgotten that under given conditions property may have character different from that imputed to it in said
articles. It is undeniable that the parties to a contract may be agreement treat as personal property that which by nature would be real property; and it is
a familiar phenomenon to see things classed as real property for purposes of taxation which on general principle might be considered personal
property. Other situations are constantly arising, and from time to time are presented to the Supreme Court, in which the proper classification of one
thing or another as real or personal property may be said to be doubtful.]

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12. Davao Saw Mill vs. Castillo (G.R. No. L-40411, August 7, 1935)
A tenant placed machines for use in a sawmill on the landlord's land.

FACTS

Davao Sawmill Co., operated a sawmill. The land upon which the business was conducted was leased from another person. On the land, Davao
Sawmill erected a building which housed the machinery it used. Some of the machines were mounted and placed on foundations of cement. In the
contract of lease, Davo Sawmill agreed to turn over free of charge all improvements and buildings erected by it on the premises with the exception of
machineries, which shall remain with the Davao Sawmill. In an action brought by the Davao Light and Power Co., judgment was rendered against
Davao Sawmill. A writ of execution was issued and the machineries placed on the sawmill were levied upon as personalty by the sheriff. Davao Light
and Power Co., proceeded to purchase the machinery and other properties auctioned by the sheriff.

ISSUE

Are the machineries real or personal property?

HELD

Art.415 of the New Civil Code provides that Real Property consists of:

(1) Lands, buildings, roads and constructions of all kinds adhered to the soil;

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(5) Machinery, receptacles, instruments or implements intended by the owner pf the tenement for an industry ot works which may be carried on in a
building or on a piece of land, and which tend directly to meet the needs of the said industry or works;

Appellant should have registered its protest before or at the time of the sale of the property. While not conclusive, the appellant's characterization of the
property as chattels is indicative of intention and impresses upon the property the character determined by the parties.

Machinery is naturally movable. However, machinery may be immobilized by destination or purpose under the following conditions:

General Rule: The machinery only becomes immobilized if placed in a plant by the owner of the property or plant.

Immobilization cannot be made by a tenant, a usufructuary, or any person having only a temporary right.

Exception: The tenant, usufructuary, or temporary possessor acted as agent of the owner of the premises; or he intended to permanently give away the
property in favor of the owner.

As a rule, therefore, the machinery should be considered as Personal Property, since it was not placed on the land by the owner of the said land.

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13. Berkenkotter vs. Cu Unjieng, Mabalacat Sugar, and Sheriff of Pampanga G.R. No. L-41643,
July 31, 1935
Facts:

On 26 April 1926, the Mabalacat Sugar Company obtained from Cu Unjieng e Hijos, a loan securedby a first mortgage constituted on 2 parcels of land
"with all its buildings, improvements, sugar-canemill, steel railway, telephone line, apparatus, utensils and whatever forms part or is a
necessarycomplement of said sugar-cane mill, steel railway, telephone line, now existing or that may in thefuture exist in said lots.

On 5 October 1926, the Mabalacat Sugar Company decided to increase the capacity of its sugar central by buying additional machinery and
equipment, so that instead of milling 150 tons daily, itcould produce 250. Green proposed to the Berkenkotter, to advance the necessary amount for
thepurchase of said machinery and equipment, promising to reimburse him as soon as he could obtainan additional loan from the mortgagees, Cu
Unjieng e Hijos, and that in case Green should fail toobtain an additional loan from Cu Unjieng e Hijos, said machinery and equipment would
becomesecurity therefore, said Green binding himself not to mortgage nor encumber them to anybody untilBerkenkotter be fully reimbursed for the
corporation's indebtedness to him.

Having agreed to said proposition made in a letter dated 5 October 1926, Berkenkotter, on 9 October 1926, delivered the sum of P1,710 to Green, the
total amount supplied by him to Green having beenP25,750. Furthermore, Berkenkotter had a credit of P22,000 against said corporation for
unpaidsalary. With the loan of P25,750 and said credit of P22,000, the Mabalacat Sugar Co., Inc., purchasedthe additional machinery and equipment.
On 10 June 1927, Green applied to Cu Unjieng e Hijos for an additional loan of P75,000 offering assecurity the additional machinery and equipment
acquired by said Green and installed in the sugar central after the execution of the original mortgage deed, on 27 April 1927, together with whatever
additional equipment acquired with said loan. Green failed to obtain said loan. Hence, abovementioned mortgage was in effect.

Issue:

Are the additional machines also considered mortgaged?

Held:

Article 1877 of the Civil Code provides that mortgage includes all natural accessions, improvements,growing fruits, and rents not collected when the
obligation falls due, and the amount of anyindemnities paid or due the owner by the insurers of the mortgaged property or by virtue of theexercise of
the power of eminent domain, with the declarations, amplifications, and limitationsestablished by law, whether the state continues in the possession of
the person who mortgaged it or whether it passes into the hands of a third person.It is a rule, that in a mortgage of real estate, the improvements on the
same are included; therefore, allobjects permanently attached to a mortgaged building or land, although they may have been placedthere after the
mortgage was constituted, are also included.

Article 334, paragraph 5, of the Civil Code gives the character of real property to machinery, liquidcontainers, instruments or implements intended by
the owner of any building or land for use inconnection with any industry or trade being carried on therein and which are expressly adapted tomeet the
requirements of such trade or industry. The installation of a machinery and equipment in amortgaged sugar central, in lieu of another of less capacity,
for the purpose of carrying out theindustrial functions of the latter and increasing production, constitutes a permanent improvement onsaid sugar
central and subjects said machinery and equipment to the mortgage constituted thereon.

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14. Manarang vs. Ofilada and Esteban (GR No. L-8133, May 18, 1956)

FACTS:

Manarang secured a loan from Esteban guaranteed by a chattel mortgage over a house of mixed
materials. Due to failure to pay, the chattel mortgage was foreclosed. Before the sale of the
property, Manarang tried to pay for the property but the sheriff refused to accept tender unless there is
payment for the publication of the notice of sale in the newspapers.

This prompted Manarang to bring this suit to compel the sheriff to accept payment. He averred that the
publication was unnecessary as the house should be considered as personal property per
agreement in the chattel mortgage, and the publication for notice of sale is unnecessary.

ISSUE:

W/N the fact that the parties entering into a contract regarding a house gave said property the
consideration of personal property in their contract, binding the sheriff in advertising the property's sale
at public auction as personal property.

HELD:

There is no question that a building of mixed materials may be a subject of chattel mortgage, in which
case it is considered as between the parties as personal property.
The mere fact that a house was the subject of chattel mortgage and was considered as personal
property by the parties doesnt make the said house personal property for purposes of the notice to
be given for its sale in public auction. It is real property within the purview of Rule 39, Section 16 of the
Rules of Court as it has become a permanent fixture on the land, which is real property.

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15. GSIS vs. Calsons, Inc. (GR No. L-19867, May 29, 1968)

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16. Mindanao Bus Co. vs. City Assessor and Treasurer of CDO (GR No. L-17870, September
29,1962)

FACTS:

Petitioner is a public utility solely engaged in transporting passengers and cargoes by motor
trucks. It owns a land where it maintains and operates a garage for its TPU motor trucks; a
repair shop; blacksmith and carpentry shops, and with machineries placed therein, its TPU
trucks are made; body constructed; and same are repaired in a condition to be serviceable in
the TPU land transportation business it operates.

The machineries have never been or were never used as industrial equipment to produce
finished products for sale, nor to repair machineries, parts and the like offered to the general
public indiscriminately for business or commercial purposes.

Respondent City Assessor of Cagayan de Oro City assessed at P4,400 petitioners above-
mentioned equipment. Petitioner appealed the assessment to the respondent Board of Tax
Appeals on the ground that the same are not realty. The Board of Tax Appeals of the City
sustained the city assessor, so petitioner herein filed with the Court of Tax Appeals a petition for
the review of the assessment.

The CTA held the petitioner liable to the payment of the realty tax on its maintenance and repair
equipment mentioned above. Hence, this petition.

ISSUE:

Should the tools and equipment in the petitioner companys repair shop be considered
immovable taxable real properties?

DOCTRINE:

NO. Movable equipment to be immobilized in contemplation of the law must first be essential
and principal elements of an industry or works without which such industry or works would be
unable to function or carry on the industrial purpose for which it was established. The tools and
equipment are not essential and principle municipal elements of petitioners business of
transporting passengers and cargoes by motor trucks. They are merely incidentals acquired
as movables and used only for expediency to facilitate and/or improve its service. The
transportation business could be carried on without the repair or service shop if its rolling
equipment is repaired or serviced in another shop belonging to another.
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17. Ago vs. Court of Appeals and Grace Park Engineering (GR No. L-17898, October 31, 1962)

FACTS
Ago bought sawmill machineries and equipments from Grace Park Engineer Domineering,
Inc. (GPED) A chattel mortgage was executed over the said properties to secure the unpaid
balance of P32,000, which Ago agreed to pay in installment basis.
Because Ago defaulted in his payment, GPED instituted extra-judicial foreclosure
proceedings of the mortgage. To enjoin the foreclosure, Ago instituted a special civil case in
the CFI of Agusan. The parties then arrived at a compromise agreement.
However, a year later, Ago still defaulted in his payment. GPED filed a motion for execution
with the lower court, which was executed on September 23, 1959.
Acting upon the writ of execution, the Provincial Sheriff of Surigao levied upon and ordered
the sale of the sawmill machineries and equipment.
Upon being advised that the public auction sale was set on December 4, 1959, Ago filed a
petition for certiorari and prohibition on December 1, 1959 with the CA. He alleged that his
counsel only received the copy of the judgment on September 25, 1959 two days after the
execution of the writ; that the order of sale of the levied properties was in grave abuse of
discretion and in excess of jurisdiction; and that the Sheriff acted illegally by levying the
properties and attempting to sell them without prior publication of the notice of sale thereof
in some newspaper of general circulation as required by the Rules of Court.
The CA issued a writ of preliminary injunction against the Sheriff, but it turned out that the
properties were already sold on December 4, 1959. The CA ordered the Sheriff to suspend
the issuance of the Certificate of Sale until the decision of the case. The CA then rendered
its decision on November 9, 1960.
ISSUES
1. Is the fact that petitioner was present in open court as the judgment was rendered,
sufficient notice of the said judgment?
2. Was the Sheriff's sale of the machineries and equipment at a public auction valid despite
lack of publication of the notice of sale?
HELD
1) No. The mere pronouncement of the judgment in open court does not constitute a
rendition of judgment.
The filing of the judge's signed decision with the Clerk of Court constitutes the rendition of a valid
and binding judgment.
Sec. 1, Rule 35 of the Rules of Court require that all judgments be rendered in writing,
personally and directly prepared by the judge, and signed by him, stating clearly and distinctly
the facts and the law on which it is based, filed with the clerk of the court.
Prior to the filing, the decision could still be subject to amendment and change and may not
constitute the real judgment of the court.

Moreover, the hearing of the judgment in open court does not constitute valid notice
thereof. No judgment can be notified to the parties unless it has previously been rendered.
Sec.7 of Rule 27 expressly requires that final orders or judgments be served either personally
or by registered mail.
The signed judgment not having been served upon the petitioner, said judgment could not
be effective upon him who had not received it. As a consequence, the issuance of the writ
of execution is null and void, having been issued before petitioner was served a copy of the
decision, personally or by registered mail.

2) The subject sawmill machineries and equipment became real estate properties in
accordance with the provision of Art. 415 (5) of the NCC:
ART. 415 The following are immovable property:

xxxx

(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement
for an industry or works which may be carried on in a building or on a piece of land, and
which tend directly to meet the needs of the said industry or works;

The installation of the sawmill machineries in the building of Gold Pacific Sawmill, Inc., for
use in the sawing of logs carried on in the said building converted them into Real
Properties as they became a necessary & permanent part of the building or real estate on
which the same was constructed.
And if they are judicially sold on execution without the necessary advertisement of sale by
publication in a newspaper as required in Sec.16 of Rule 39 of the Rules of Court, the sale
made by the sheriff would be null and void.

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18. Sergs Product vs. PCI Leasing and Finance Corporation (GR No. 137705, August 22, 2000)

FACTS:
PCI Leasing and Finance filed a complaint for sum of money, with an application for a writ of
replevin.
Judge issued a writ of replevin directing its sheriff to seize and deliver the machineries and
equipment to PCI Leasing after 5 days and upon the payment of the necessary expenses.
The sheriff proceeded to petitioner's factory, seized one machinery, with word that he would
return for other machineries.
Petitioner (Sergs Products) filed a motion for special protective order to defer enforcement of
the writ of replevin.
PCI Leasing opposed the motion on the ground that the properties were still personal and
therefore can still be subjected to seizure and writ of replevin.
Petitioner asserted that properties sought to be seized were immovable as defined in Article 415
of the Civil Code.
Sheriff was still able to take possession of two more machineries
In its decision on the original action for certiorari filed by the Petitioner, the appellate court,
Citing the Agreement of the parties, held that the subject machines were personal property, and
that they had only been leased, not owned, by petitioners; and ruled that the "words of the
contract are clear and leave no doubt upon the true intention of the contracting parties."

ISSUE: Whether or not the machineries became real property by virtue of immobilization.

Ruling:
Petitioners contend that the subject machines used in their factory were not proper subjects of
the Writ issued by the RTC, because they were in fact real property.

Writ of Replevin: Rule 60 of the Rules of Court provides that writs of replevin are issued for the
recovery of personal property only.

Article 415 (5) of the Civil Code provides that machinery, receptacles, instruments or
implements intended by the owner of the tenement for an industry or works which may be
carried on in a building or on a piece of land, and which tend directly to meet the needs of the
said industry or works

In the present case, the machines that were the subjects of the Writ of Seizure were placed by
petitioners in the factory built on their own land.They were essential and principal elements of
their chocolate-making industry.Hence, although each of them was movable or personal
property on its own, all of them have become immobilized by destination because they are
essential and principal elements in the industry.

However, contracting parties may validly stipulate that a real property be considered as
personal. After agreeing to such stipulation, they are consequently estopped from claiming
otherwise.Under the principle of estoppel, a party to a contract is ordinarily precluded from
denying the truth of any material fact found therein.

Section 12.1 of the Agreement between the parties provides The PROPERTY is, and shall at
all times be and remain, personal property notwithstanding that the PROPERTY or any part
thereof may now be, or hereafter become, in any manner affixed or attached to or embedded in,
or permanently resting upon, real property or any building thereon, or attached in any manner to
what is permanent.

The machines are personal property and they are proper subjects of the Writ of Replevin
-----------------------------------------------------------

19. Tumalad vs. Vicencio (GR No. L-30173, September 30, 1971)

Facts:

On Sep 1, 1955, Vicencio and Simeon executed a chattel mortgage in favor of Tumalad over
their house of strong materials located at Quiapo, Manila over Lot Nos 6B and 7B, Block 2554,
which were being rented from Madrigal & Company, Inc. It was also agreed that in default the
payment of any amortizations would cause the remaining unpaid balance to become
immediately due and payable, the Sheriff of the City of Manila or any of his deputies is
empowered and authorized to sell all the mortgagors property after the necessary publication in
order to settle the financial debts, plus interest and yearly fees.

When Vicencio & Simeon defaulted in paying, the mortgage was extrajudicially foreclosed, and
on 27 Mar 1956, the house was sold at public auction pursuant to the sent contract. As highest
bidder, Tumalad were issued corresponding certificate of sale. Municipal court eventually
rendered a decision ordering defendants to vacate the premises described in the complaint.

During the pendency of the appeal to the CFI, Vicencio and Simeon failed to deposit rent for
Nov 1956. As a result, the court granted Tumalads motion for execution, and it was issued Jan
1957. However, the judgement regarding the surrender of possession to Tumalad could not be
executed because the subject house had been already demolished on Jan 1957 pursuant to the
order of court in a separate civil case for ejectment against the present defendants for non-
payment of rentals on the land where the house was constructed.

Vicencio & Simeon predicate their theory of nullity of the chattel mortgage on two grounds: a)
that their signatures on the chattel mortgage were obtained through fraud, deceit, or trickery,
and b) that the subject matter of mortgage is a house o strong materials, and being an
immovable, it can only be the subject of a real estate mortgage and not a chattel mortgage.

Issue:

Whether the subject of chattel mortgage, which is a house of strong material and being an
immovable, is valid.

Held:

Yes. The subject matter of chattel mortgage is valid.

The house on rented land is not only expressly designated as chattel mortgage. It specifically
provides that the mortgagor voluntarily cedes, sells, and transfers, by way of Chattel Mortgage,
the property together with its leasehold rights over the lot on which it is constructed. Although
there is no specific statement referring to the subject house as personal property, yet by ceding,
selling, or transferring a property by way of chattel mortgage, Vicencio & Simeon could only
have meant to convey the house as chattel, or at least, intended to treat the same as such, so
that they should not be allowed to make an inconsistent stand by claiming otherwise.

Moreover, the subject house stood on a rented lot to which Vicencio and Simeon merely had a
temporary right as lessee, although this cannot in itself alone determine the status of the
property, it does so when combined with other factors to sustain the interpretation that the
parties intended to treat the house as personal property.

Finally, it is Vicencio and Simeon themselves who are attacking the validity of the chattel
mortgage in this case. The doctrine therefore applies to the herein defendants, having treated
the subject house as personal property.

FOR THE FOREGOING REASONS, the decision appealed from is reversed and another one
entered, dismissing the complaint. With costs against plaintiffs-appellees
-----------------------------------------------------------

20. Navarro vs. Pineda, (G.R. No. L-18456, November 30, 1963)

FACTS:

Pineda and his mother executed real estate and chattel mortgages in favor of Navarro, to secure a loan
they got from the latter. The REM covered a parcel of land owned by the mother while the chattel
mortgage covered a residential house. Due to the failure to pay the loan, they asked
for extensions to pay for the loan. On the second extension, Pineda executed a PROMISE wherein in
case of default in payment, he wouldnt ask for any additional extension and there would be no need for
any formal demand. In spite of this, they still failed to pay.

Navarro then filed for the foreclosure of the mortgages. The court decided in his favor.
ISSUE:

W/N the deed of real estate mortgage and chattel mortgage appended to the complaint is valid
notwithstanding the fact that the house was made subject of chattel mortgage for the reason that it is
erected on a land that belongs to a third person.

HELD:

Where a house stands on a rented land belonging to another person, it may be the subject matter
of a chattel mortgage as personal property if so stipulated in the document of mortgage, and in an
action by the mortgagee for the foreclosure, the validity of the chattel mortgage cannot be assailed by
one of the parties to the contract of mortgage.

Furthermore, although in some instances, a house of mixed materials has been considered as a chattel
between the parties and that the validity of the contract between them, has been recognized, it
has been a constant criterion that with respect to third persons, who are not parties to
the contract, and specially in execution proceedings, the house is considered as immovable property.

-----------------------------------------------------------

21. Makati Leasing and Finance Corporation vs. Wearever Textile Mills (G.R. No. L-58469 May
16,1983)

FACTS
Wearever Textile Mills, Inc. executed a chattel mortgage contract in favor of Makati Leasing and
Finance Corporation covering certain raw materials and machinery. Upon default, Makati
Leasing fi led a petition for judicial foreclosure of the properties mortgaged. Acting on Makati
Leasings application for replevin, the lower court issued a writ of seizure. Pursuant thereto, the
sheriff enforcing the seizure order seized the machinery subject matter of the mortgage. In a
petition for certiorari and prohibition, the Court of Appeals ordered the return of the machinery
on the ground that the same can-not be the subject of replevin because it is a real property
pursuant to Article415 of the new Civil Code, the same being attached to the ground by means
of bolts and the only way to remove it from Wearever textiles plant would be to drill out or
destroy the concrete fl oor. When the motion for reconsideration of Makati Leasing was denied
by the Court of Appeals, Makati Leasing elevated the matter to the Supreme Court.

ISSUE
Whether the machinery in suit is real or personal property from the point of view of the parties.

HELD
There is no logical justification to exclude the rule out the present case from the application of
the pronouncement in Tumalad v Vicencio, 41 SCRA 143. If a house of strong materials, like
what was involved in the Tumalad case, may be considered as personal property for purposes
of executing a chattel mortgage thereon as long as the parties to the contract so agree and no
innocent third party will be prejudiced thereby, there is absolutely no reason why a machinery,
which is movable in its nature and becomes immobilized only by destination or purpose, may
not be likewise treated as such. This is really because one who has so agreed is estopped from
the denying the existence of the chattel mortgage.

In rejecting petitioners assertion on the applicability of the Tumalad doctrine, the CA lays stress
on the fact that the house involved therein was built on a land that did not belong to the owner of
such house. But the law makes no distinction with respect to the ownership of the land on which
the house is built and We should not lay down distinctions not contemplated by law.

It must be pointed out that the characterization by the private respondent is indicative of the
intention and impresses upon the property the character determined by the parties. As stated in
Standard Oil Co. of New York v. Jaramillo, 44 Phil. 630, it is undeniable that the parties to a
contract may, by agreement, treat as personal property that which by nature would be a real
property as long as no interest of third parties would be prejudiced thereby.

The status of the subject matter as movable or immovable property was not raised as an issue
before the lower court and the CA, except in a supplemental memorandum in support of the
petition filed in the appellate court. There is no record showing that the mortgage has been
annulled, or that steps were taken to nullify the same. On the other hand, respondent has
benefited from the said contract.

Equity dictates that one should not benefit at the expense of another.

As such, private respondent could no longer be allowed to impugn the efficacy of the chattel
mortgage after it has benefited therefrom.

Therefore, the questioned machinery should be considered as personal property.

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22. Benguet Corporation vs. Central Board of Assessment Appeal (GR No. 106041, January 29,
1993)

FACTS:
On 1985, Provincial Assessor of Zambales assessed the said properties in issue as taxable
improvements. The assessment was appealed to the Board of Assessment Appeals of the
Province of Zambales. However, the appeal was dismissed mainly on the ground of the
petitioner's failure to pay the realty taxes that fell due during the pendency of the appeal.

The petitioner elevated the matter to the Central Board of Assessment Appeals, one of
the herein respondents. In its decision dated March 22, 1990, the Board reversed the dismissal
of the appeal but, agreed that the tailings dam and the lands submerged thereunder shall be
subject to realty tax.

For purposes of taxation the dam is considered as real property as it comes within the
object mentioned in Article 415 of the New Civil Code, It is a construction adhered to the soil
which cannot be separated or detached without breaking the material or causing destruction on
the land upon which it is attached. The immovable nature of the dam as an improvement which
determines its character as real property, hence taxable under Section 38 of the Real Property
Tax Code.

ISSUES:
1. Whether or not the tailings dam is subject to realty tax?
2. Whether or not it be considered as immovable property?

HELD:
Yes, it is subject to realty tax and it is considered an immovable property.

The petitioner does not dispute that the tailings dam may be considered realty within the
meaning of Article 415. It insists, however, that the dam cannot be subjected to realty tax as a
separate and independent property because it does not constitute an "assessable improvement"
on the mine although a considerable sum may have been spent in constructing and maintaining
it.

The Real Property Tax Code does not carry a definition of "real property" and simply
says that the realty tax is imposed on "real property, such as lands, buildings, machinery and
other improvements affixed or attached to real property." In the absence of such a definition,
applying Article 415 of the Civil Code, which states that the following are considered
immovables: Section No. 1 Lands, buildings and constructions of all kinds adhered to the soil;
Section no. 3 Everything attached to an immovable in a fixed manner, in such a way that it
cannot be separated therefrom without breaking the material or deterioration of the object.

Even without the tailings dam, the petitioner's mining operation can still be carried out
because the primary function of the dam is merely to receive and retain the wastes and water
coming from the mine. There is no allegation that the water coming from the dam is the sole
source of water for the mining operation so as to make the dam an integral part of the mine. In
fact, as a result of the construction of the dam, the petitioner can now impound and recycle
water without having to spend for the building of a water reservoir.

And as the petitioner itself points out, even if the petitioner's mine is shut down or ceases
operation, the dam may still be used for irrigation of the surrounding areas.

From the definitions and the cases cited in relation to this case, it would appear that
whether a structure constitutes an improvement so as to partake of the status of realty would
depend upon the degree of permanence intended in its construction and use, The expression
"permanent" as applied to an improvement does not imply that the improvement must be used
perpetually but only until the purpose to which the principal realty is devoted has been
accomplished. It is sufficient that the improvement is intended to remain as long as the land to
which it is annexed is still used for the said purpose.

The Court is convinced that the subject dam falls within the definition of an
"improvement" because it is permanent in character and it enhances both the value and utility of
petitioner's mine. Moreover, the immovable nature of the dam defines its character as real
property under Article 415 of the Civil Code and thus makes it taxable under Section 38 of the
Real Property Tax Code.

Hence, petition was dismissed by the Supreme Court.

-----------------------------------------------------------

23. Meralco Securities Industrial Corporation vs. Central Board of Assessment Appeal (GR No.
L-47943, May 431, 1982)

Facts:
Pursuant to a pipeline concession issued under the Petroleum Act of 1949, Republic Act No.
387, Meralco Securities installed from Batangas to Manila a pipeline system consisting of
cylindrical steel pipes joined together and buried not less than one meter below the surface
along the shoulder of the public highway. The pipes are embedded in the soil and are firmly and
solidly welded together so as to preclude breakage or damage thereto and prevent leakage or
seepage of the oil. The valves are welded to the pipes so as to make the pipeline system one
single piece of property from end to end.

In order to repair, replace, remove or transfer segments of the pipeline, the pipes have to be
cold-cut by means of a rotary hard-metal pipe-cutter after digging or excavating them out of the
ground where they are buried. In points where the pipeline traversed rivers or creeks, the pipes
were laid beneath the bed thereof. Hence, the pipes are permanently attached to the land.

Pursuant to the Assessment Law, Commonwealth Act No. 470, the provincial assessor of
Laguna treated the pipeline as real property and issued tax declarations, containing the
assessed values of portions of the pipeline.

Meralco appealed the assessments to the defendants, but the latter ruled that pipeline is subject
to realty tax. The defendants argued that the pipeline is subject to realty tax because they are
contemplated in Assessment Law and Real Property Tax Code; that they do not fall within the
category of property exempt from realty tax under those laws; that Articles 415 & 416 of the Civil
Code, defining real and personal property have no applications to this case because these
pipes are constructions adhered to soil and things attached to the land in a fixed manner, and
that Meralco Securities is not exempt from realty tax under petroleum law.

Meralco insists that its pipeline is not subject to realty tax because it is not real property within
the meaning of Art. 415.

Issue:
Whether the aforementioned pipelines are subject to realty tax.

Held:
Yes, the pipelines are subject to realty tax.

Section 2 of the Assessment Law provides that the realty tax is due on real property, including
land, buildings, machinery, and other improvements. This provision is reproduced with some
modification in Section 38, Real Property Tax Code, which provides that there shall be levied,
assessed, and collected xxx annual ad valorem tax on real property such as land, buildings,
machinery, and other improvements affixed or attached to real property xxx.

It is incontestable that the pipeline of Meralco Securities does not fall within any of the classes
of exempt real property enumerated in section 3 of the Assessment Law and section 40 of the
Real Property Tax Code.

Pipeline means a line of pipe connected to pumps, valves and control devices for conveying
liquids, gases or finely divided solids. It is a line of pipe running upon or in the earth, carrying
with it the right to the use of the soil in which it is placed.
Article 415[l] and [3] provides that real property may consist of constructions of all kinds adhered
to the soil and everything attached to an immovable in a fixed manner, in such a way that it
cannot be separated therefrom without breaking the material or deterioration of the object.

The pipeline system in question is indubitably a construction adhering to the soil. It is attached
to the land in such a way that it cannot be separated therefrom without dismantling the steel
pipes which were welded to form the pipeline.

WHEREFORE, the questioned decision and resolution are affirmed. The petition is dismissed.
No costs.
-----------------------------------------------------------

Co-ownership
24. Lilian Sanchez vs. CA and Virginia Teria ([G.R. No. 152766. June 20, 2003)

FACTS OF THE CASE:Lilian Sanchez constructed a house on a 76-square meter lot owned by
her parents-in-law. The lot was registered with Eliseo Sanchez, Marilyn Sanchez, Lilian
Sanchez, Nenita Sanchez, Susana Sanchez and Felipe Sanchez as co-owners.
On 20 February 1995, the lot was registered in the name of private respondent Virginia Teria by
virtue of a Deed of Absolute Sale allegedly executed by the six co-owners in her favor.
Petitioner, however, claimed that she did not affix her signature on the document and
subsequently refused to vacate the lot, thus prompting Teria to file an action for recovery of
possession of the lot.
ISSUE: Whether or not petitioner is entitled to her 1/6 share of the co-owned property
HELD AND RATIO: YES. The lower courts failed to pass upon the issue of co-ownership
present in the case at hand.
Co-ownership, whether established by law or by agreement of the co-owners, the property or
thing held pro-indiviso is impressed with a fiducial nature so that each co-owner becomes a
trustee for the benefit of his co-owners and he may not do any act prejudicial to the interest of
his co-owners. Thus, the legal effect of an agreement to preserve the properties in co-ownership
is to create an express trust among the heirs as co-owners of the properties. Co-ownership is a
form of trust and every co-owner is a trustee for the others.
Before the partition of a land or thing held in common, no individual or co-owner can claim title
to any definite portion thereof. All that the co-owner has is an ideal or abstract quota or
proportionate share in the entire land or thing.
Article 493 of the Civil Code gives the owner of an undivided interest in the property the right to
freely sell and dispose of it, i.e., his undivided interest. He may validly lease his undivided
interest to a third party independently of the other co-owners. But he has no right to sell or
alienate a concrete, specific or determinate part of the thing owned in common because his right
over the thing is represented by a quota or ideal portion without any physical adjudication.
Although assigned an aliquot but abstract part of the property, the metes and bounds of
petitioners lot has not been designated. As she was not a party to the Deed of Absolute
Salevoluntarily entered into by the other co-owners, her right to 1/6 of the property must be
respected. Partition needs to be effected to protect her right to her definite share and determine
the boundaries of her property. Such partition must be done without prejudice to the rights of
private respondent Virginia Teria as buyer of the 5/6 portion of the lot under dispute.
-----------------------------------------------------------

25. Vda. de Ape vs. CA and Dva de Lumayno, [G.R. No. 133638. April 15, 2005]
Cleopas Ape died in 1950 and left a parcel of land (Lot 2319) to his 11 children. The children
never formally divided the property amongst themselves except through hantal-hantal whereby
each just occupied a certain portion and developed each.

On the other hand, the spouses Lumayno were interested in the land so they started buying the
portion of land that each of the heirs occupied. On 11 Apr 1973, one of the children, Fortunato,
entered into a contract of sale with Lumayno. In exchange of his lot, Lumayno agreed to pay
P5,000.00. She paid in advance P30.00. Fortunato was given a receipt prepared by Lumaynos
son in law (Andres Flores). Flores also acted as witness. Lumayno also executed sales
transactions with Fortunatos siblings separately.

In 1973, Lumayno compelled Fortunato to make the the delivery to her of the registrable deed of
sale over Fortunatos portion of the Lot No. 2319. Fortunato assailed the validity of the contract
of sale. He also invoked his right to redeem (as a co-owner) the portions of land sold by his
siblings to Lumayno. Fortunato died during the pendency of the case.

ISSUE: Whether or not there was a valid contract of sale?

HELD: No. Fortunato was a no read no write person. It was incumbent for the the other party
to prove that details of the contract was fully explained to Fortunato before Fortunato signed the
receipt.

A contract of sale is a consensual contract, thus, it is perfected by mere consent of the parties.
It is born from the moment there is a meeting of minds upon the thing which is the object of the
sale and upon the price. Upon its perfection, the parties may reciprocally demand performance,
that is, the vendee may compel the transfer of the ownership and to deliver the object of the
sale while the vendor may demand the vendee to pay the thing sold. For there to be a perfected
contract of sale, however, the following elements must be present: consent, object, and price in
money or its equivalent.

For consent to be valid, it must meet the following requisites:

(a) it should be intelligent, or with an exact notion of the matter to which it refers;

(b) it should be free and

(c) it should be spontaneous. Intelligence in consent is vitiated by error; freedom by violence,

intimidation or undue influence; spontaneity by fraud.

Lumayno claimed that she explained fully the receipt to Fortunato, but Flores testimony belies
it. Flores said there was another witness but the other was a maid who also lacked education.
Further, Flores himself was not aware that the receipt was to transfer the ownership of
Fortunatos land to her mom-in-law. It merely occurred to him to explain the details of the
receipt but he never did.
-----------------------------------------------------------

26. Spouses Ricardo and Vicenta Pardel vs. Sposes Gaspar and Matilde Bartolome (23
Phil.450)

-----------------------------------------------------------
27. Longings Javier vs Segundo Javier (6 Phil 493)
SYLLABUS

1. REALTY; POSSESSION; JUDICIAL ADMINISTRATOR. Alfonso v. Natividad, No. 2518,

April 30, 1906, followed as to the right of a judicial administrator to recover possession of real
estate belonging to the estate of the deceased.

2. ID.; ID.; GOOD FAITH; REIMBURSEMENT. The defendants, knowing that the land which
they occupied was the property of others, were not possessors in good faith (art. 433, Civil
Code) and are not entitled to be reimbursed for the cost of a house built thereon by them. (Art.
453, Civil Code.)

3. ID.; OWNERSHIP; COMMUNITY OF PROPERTY. The ownership of a house by one

person, and of the land on which it stands by another, does not create a community of property
as that term is used in articles 392 et seq. of the Civil Code.

4. ID.; TENANTS IN COMMON; CONSTRUCTION EXPENSES. The defendants, tenants in

common with others of a tract of land, built a house thereon. Held, That they could not compel
their cotenants to share in the expense of such construction, though they tacitly consented
thereto. (Art. 397, Civil Code.)

-----------------------------------------------------------

28. Enriquez vs. A. S. Watson and Co. (22 Phil., 623),

It appears from the record that the appellants in this case occupied the building at No. 14
Escolta Street, known by the name of the English Dispensary and being a part of the property of
the Enriquez estate, under a lease thereof, from January, 1900, to May of 1901. The amount of
the stipulated rent for that period has been paid by them. The rent corresponding to the period
from January, 1900, to May, 1900, was paid twice; first to the administrator of the estate and
later deposited in court. The appellee seeks now to evict the appellants from said property,
alleging as his ground therefor the non-payment of the amount of rent corresponding to said
period.

The situation in which Messrs. Watson & Co. are found in this case is due principally, in our
opinion, to the litigation between the Enriquez brothers over the estate of their deceased
parents. During the first period above mentioned the administration of said property passed
three times from the hands of one to those of the other of the brothers, Francisco and Rafael.
The claim made by Don Rafael does not refer to the failure to pay the said rents but to the fact
that these were paid improperly to his brother. It is not surprising that with these frequent
changes of administrators the tenants of the properties of the estate have committed mistakes
in the payments.

The judgment, whose execution is sought in this case, was rendered by default on June 20,
1900. The summons was served upon the person in charge of the establishment, who was
denied an extension of some days which he applied for by reason of the absence of the attorney
in fact of the house. This judgment became final, and although it is not proper for us, perhaps, to
inquire into the merits of said judgment for the purpose of determining its annulment, we can
take into consideration the antecedents of the case so far as they serve to make clear the
succeeding acts of Don Francisco as well as of Don Rafael. If the rents whose alleged
nonpayment gave rise to said action have been actually received by the Enriquez estate the
abandonment of the judgment could be more readily deduced from the succeeding facts than if
they had not been paid at any time.

After the 1st day of September, 1900, it was Don Francisco who had charge of the
administration of the estate. The court notified the appellants that they should recognize him as
such. After the said date the said Francisco recognized the appellants as the tenants of the
estate and continued to receive from them the amount of the rents until January 25, 1901, when
a new lease for twelve years was entered into. Although said lease may have been void it is true
that the contracting parties conformed to its terms, paying the amount of the stipulated rent to
Don Francisco from January 25, 1901, to April 1. The latter likewise had previously received the
rents corresponding to the months from January to May, 1900, which, according to the
allegations of Don Rafael, were not paid. As a result of these allegations the judgment referred
to was entered. The facts related disclose to us conclusively that Don Francisco never intended
to ask the execution of this judgment nor considered Messrs. Watson & Co. evicted, but rather
as actual tenants.

As for Don Rafael, his attorney stated before this court that upon assuming charge of the
property in February, 1901, he demanded of the appellants the amount of the rents. The
statements of his attorney would contradict and be inconsistent with any theory other than that
the rents thus demanded were those accrued under the new lease of January 25, 1901. The
appellants paid to him the rents from April, but refused to pay that corresponding to the month of
March, stating that they had already paid the same to Don Francisco. As a result of this refusal
proceedings were had for the purpose of reviving the old judgment of the previous year. It
appears to us that the true reason which prompted this action was not the nonpayment of the
rents from January to May, 1900, but the fact of the nonpayment to Don Rafael of those
corresponding to the month of March, 1901. The original judgment can not be utilized for such
purpose. If there has been such failure to pay the rent corresponding to the month last named,
Don Rafael ought to have presented the proper complaint, basing it upon the fact. It is not the
contract above referred to entered into with the administrator Don Francisco which gives rise to
the re-leasing of the property, but the successive acts of administration of the latter, recognizing
it in the name of the estate whose representative he alone was acts neither impugned nor
declared void until now, by virtue of which he has accepted the agreements of the tenant which
until now have likewise not been rejected by the estate or objected to in any way.

In view of the established facts above related we are of the opinion and decide that there have
been subsequent juridical acts between the appellants on one side and on the other the
Enriquez estate, represented either by Don Francisco or by Don Rafael, by virtue of which the
said appellants must have continued as such tenants of the estate, notwithstanding the
judgment given on June 20, 1900, which by reason of the very acts of the plaintiff estate has
become ineffective and has lost its executory force.

Wherefore the judgment appealed from is reversed with costs taxed to the appellee, and it is so
ordered.

-----------------------------------------------------------

29. Manuel, Mariano, Pura and Caridad Melencio vs. Dy Tiao Lay (55 Phil. 99)

-----------------------------------------------------------

30. Lopez vs. Martinez (5 Phil. 567)

-----------------------------------------------------------

31. Ramirez vs. Bautista (G.R. No. L-5075 December 1, 1909)

FACTS:

Moises Ramirez, who died intestate, was married twice. In his first marriage, he had five (5)
children, named Rosa, Carmen, Francisco, Mauricia, and Ignacia. Under his second marriage,
he had three (3) children namely Cirila, Isabel, and Serapio, of whom Isabel alone survives. His
wives predeceased him and at the time of his death he left two fish ponds.

The children of the first marriage sold the two fish ponds, to Simeon Bautista and Raymundo
Duran for P1,100.00. The only surviving child of the second marriage, Isabel, was not a party to
said sale. A case was filed by the administrator of the intestate estate to have the sale declared
null and void and the fish ponds restored to the intestate estate of Moises.

ISSUE:

Whether or not the sale was valid.

RULING:

Yes. It was determined by the Court that the status of the two fish ponds was of community of
property. The fishponds were acquired during the first marriage. Therefore the conjugal gains on
property should have applied.

The Court laid down the following rules:

1. When two or more heirs appear at the opening of a testamentary succession, or during the
progress of the settlement of an intestate estate, and each turns out to be an owner pro indiviso
of the inheritance, by reason of the share he may be entitled to receive, a community of property
then exists between the participants as long as the estate remains undivided and nothing more
tangible can be imagined than this necessary community, which arose at the moment when the
coheirs assumed the entire representation of the person of the deceased with respect to all of
his property, rights, and actions, both active and passive.

2. Every co-owner shall have full ownership of his part and in the fruits and benefits derived
there from, and he therefore may alienate, assign, or mortgage it, and even substitute another
person in its enjoyment, unless personal rights are in question. But the effect of the alienation or
mortgage, with regard to the co-owners, shall be limited to the share which may be awarded him
in the division on the dissolution of the community.

Applying the said rules, the death of the mother vested in the children of the first marriage their
mothers half share. The death of Moises entitled his eight children to a share each in the
fishponds. Therefore, Isabella, being the lone survivor of her siblings, was entitled to a 3/16
share of the total property.

The Court held that Rosa, Carmen, Francisco, Mauricia, and Ignacia Ramirez could have
lawfully alienated their respective shares in the joint ownership of the two parcels of land. The
sale to the defendants, Simeon Bautista and Raymundo Duran was the sale of 13/16 of the said
two properties and could not have been void. It was the sale of the 3/16 which belonged to
Isabela alone which was void.

Simeon Bautista and Raymundo Duran succeed to the vendors should have been validly
subrogated in the joint ownership of the two fish ponds sold and that the shares that redounded
to them were the same that were owned by the vendors, which was, 13/16 of the two properties.

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32. Tuazon vs. Tuazon (GR No. L-3404, April 2, 1961)

FACTS: In 1941 the sisters Angela I. Tuason and Nieves Tuason de Barreto and their brother
Antonio Tuason Jr., held a parcel of land with an area of 64,928.6 sq. m. covered by Certificate
of Title No. 60911 in Sampaloc, Manila, in common, each owning an undivided 1/3 portion
The share of Nieves was sold to Gregorio Araneta Inc., a domestic corporation, and a new
Certificate of Title No. 61721 was issued in lieu of the old title No. 60911 covering the same
property. The three co-owners agreed to have the whole parcel subdivided into small lots and
then sold, the proceeds of the sale to be later divided among them.
Before, during and after the execution of this contract , Atty. J. Antonio Araneta was acting as
the attorney-in-fact and lawyer of the two co-owners, Angela I. Tuason and her brother Antonio
Tuason Jr. At the same time he was a member of the Board of Director of the third co-owner,
Araneta, Inc.
On September 16, 1944, Angela I. Tuason revoked the powers conferred on her attorney-in-fact
and lawyer, J. Antonio Araneta because of alleged breach of the terms of the "Memorandum of
Agreement" and abuse of powers granted to it in the document, she had decided to rescind
said contract and she asked that the property held in common be partitioned. Later, Angela filed
a complaint in the Court of First Instance of Manila asking the court to order the partition of the
property in question and that she be given 1/3 of the same including rents collected during the
time that the same including rents collected during the time that Araneta Inc., administered said
property.
The suit was administered principally against Araneta, Inc. Plaintiff's brother, Antonio Tuason
Jr., one of the co-owners evidently did not agree to the suit and its purpose, for he joined
Araneta, Inc. as a co-defendant.however the court dismissed the complaint without
pronouncement as to costs. The plaintiff appealed from that decision.
Some of the reasons advanced by appellant to have the memorandum contract (Exh. 6)
declared null and void or rescinded are that she had been tricked into signing it; that she was
given to understand by Antonio Araneta acting as her attorney-in-fact and legal adviser that said
contract would be similar to another contract of subdivision of a parcel into lots and the sale
thereof entered into by Gregorio Araneta Inc., that the defendant company has violated the
terms of the contract by not previously showing her the plans of the subdivision, the schedule of
prices and conditions of the sale, in not introducing the necessary improvements into the land
and in not delivering to her her share of the proceeds of the rents and sales.
ISSUE: Whether or not the contract should be declared null and void because its terms,
particularly paragraphs 9, 11 and 15 which violate the provisions of Art. 400 of the Civil Code
RULING:
ART. 400. No co-owner shall be obliged to remain a party to the community. Each may, at any
time, demand the partition of the thing held in common.
Nevertheless, an agreement to keep the thing undivided for a specified length of time, not
exceeding ten years, shall be valid. This period may be a new agreement.
We agree with the trial court that the provisions of Art. 400 of the Civil Code are not applicable.
The contract far from violating the legal provision that forbids a co-owner being obliged to
remain a party to the community, precisely has for its purpose and object the dissolution of the
co-ownership and of the community by selling the parcel held in common and dividing the
proceeds of the sale among the co-owners. The obligation imposed in the contract to preserve
the co-ownership until all the lots shall have been sold, is a mere incident to the main object of
dissolving the co-owners. By virtue of the document, the parties thereto practically and
substantially entered into a contract of partnership as the best and most expedient means of
eventually dissolving the co-ownership, the life of said partnership to end when the object of its
creation shall have been attained.
Looking at the case from a practical standpoint as did the trial court, we find no valid ground for
the partition insisted upon the appellant.
In view of the foregoing, the decision appealed from is hereby affirmed. There is no
pronouncement as to costs.

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33. Romana Cortez, et al vs. Florencia Oliva (G.R. No. 10104. February 10, 1916)
Facts:
The plaintiffs are heirs of Pio Oliva who owned a large
machine used for grinding sugar cane. Pio and his brother,
Florencio, jointly owned another smaller machine used for the
same purpose. The large machine was owned outright by Pio
while the smaller machine was owned by both the brothers.
Florencio was an owner of a hacienda while Pio was a tenant
thereon. The two machines were installed and used in the
hacienda. However, upon the breakout of the Spanish
revolution, the hacienda and the machines were abandoned.
Florencio only went back to the hacienda when it was already
peaceful and found the machines to be in need of repair. He
spent for the repairs of both machines but it was only the large
machine that was used while the smaller machine was never
sold despite efforts. Pio died and his heirs sued Florencio for
unlawfully taking possession of the machines and claimed that
they were the true owners thereof. Florencio, on the other
hand, stated that he had a claim over the machines because
Pio was indebted to him. Hence, this petition.

Issue:
1. Whether or not the heirs own the machines.

Held:
As to the large machine, no. The action against Florencio had
already prescribed since he had a claim of ownership over
such machine for more than 4 years. Florencio regarded
himself as the lawful owner of the machine at the time when
he wrote a letter to one of the plaintiffs explaining that he was
keeping the machine because of Pios indebtedness.
As to the smaller machine, yes. The brothers had joint
ownership over the machine. Even if Florencio held the
machine for a long period of time and exercised acts of
ownership, there was no sufficient ground for him to interfere
in the possession of such machine under a claim of ownership
since there must be a clear showing that Pio repudiated his
claim over such machine. The Court stated that the smaller
machine must be sold and that the proceeds must be
partitioned between Pios heirs and Florencio.
Hence, the Court affirmed the decision of the lower court
without prejudice to the filing of a case by the heirs for the
selling and partitioning of the proceeds from the smaller
machine.

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34. De Santos vs. Bank of the Philippine Islands (G.R. No. 38544. November 18, 1933.)

1. "RES JUDICATA" ; REQUISITES FOR ITS EXISTENCE. This court has constantly held
that in order that res judicata may exist, it is necessary that there be identity of parties, of
grounds or causes of action and of things or subject matter under litigation (Aquino v. Director of
Lands, 39 Phil., 850; Isaac v. Padilla, 31 Phil., 469; Donato v. Mendoza, 25 Phil., 57; Roman
Catholic Archbishop of Manila v. Director of Lands, 35 Phil., 339).

2. DESCENT AND DISTRIBUTION; CONTEST OF PARTITION IN CASE OF FRAUD OR

PREJUDICE TO CREDITORS. Inasmuch as article 403 of the Civil Code authorizes creditors
to contest a partition already made in case of fraud, or when it has been made to the prejudice
of existing rights and interests, and inasmuch as the oppositor-appellee herein, Bank of the
Philippine Islands, was not notified of the partition made among the herein petitioner-appellants
and their cowners Felipe de Santos and Isidoro de Santos, and was not given an opportunity
to contest the partition already made, nor the approval thereof by the cadastral court, the case
should be remanded to the court a quo in order to permit the aforesaid oppositor-appellee, Bank
of the Philippine Islands, to file the objections it deems convenient, in accordance with the
provisions of article 403 of the Civil Code cited above.
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35. Garcia de Lara vs. Gonzales de Lara (G.R. No. 1111 May 16, 1903)

1. CIVIL PROCEDURE; EXCEPTIONS. The nature of exceptions, making thereof, and

preparation of bills of exceptions explained.

2. PARTITION; NECESSARY PARTIES. A bill will not lie for the partition of an undivided
interest in land without the joinder of coowners.
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