SANTOS EVANGELISTA v.
ALTO SURETY & INSURANCE
CLASSIFICATION OF PROPERTY
LADERA v. HODGES
G.R. No. 8027-R; Vol. 48, No. 12, Official Gazette 5374
September 23, 1952
Reyes, J.B.L., J.
Issue: Is Ladera’s house an immovable property?
Held: YES. The old Civil Code enumerates among the things
declared by it as immovable property the following: lands,
buildings, roads and constructions of all kind adhered to the soil.
The law does not make any distinction whether or not the owner of
the lot is the one who built. Also, since the principles of accession
regard buildings and constructions as mere accessories to the
land on which it is built, it is logical that said accessories should
partake the nature of the principal thing.
MINDANAO BUS COMPANY vs.THE CITY ASSESSOR &
TREASURER and the BOARD OF TAX APPEALS of Cagayan
de Oro City
G.R. No. L-17870
September 29, 1962
Labrador, J.:
Issue: Whether or not tools, equipment and machineries of
petitioner bus company are taxable realties, by reason of their
being intended or destined for use in an industry.
Held: No. The law that governs the determination of the question
at issue is Par. 5, Art. 415 of the Civil Code which states 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.
So that 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." We may here distinguish, therefore, those
movable which become immobilized by destination because they
are essential and principal elements in the industry for those which
may not be so considered immobilized because they are merely
incidental, not essential and principal. The tools and equipment in
question in this instant case are, by their nature, not essential and
principle municipal elements of petitioner's 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. Even without
such tools and equipments, its business may be carried on, as
petitioner has carried on, without such equipment, before the war.
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.
Aside from the element of essentiality the above-quoted provision
also requires that the industry or works be carried on in a building
or on a piece of land. But in the case at bar the equipments in
question are destined only to repair or service the transportation
business, which is not carried on in a building or permanently on a
piece of land, as demanded by the law. Said equipments may not,
therefore, be deemed real property.
MAKATI LEASING & FINANCE CORP. v. WEAREVER
TEXTILES
G.R. No. L-58469
May 16, 1983
De Castro, J.
Issue: Whether the machinery in suit is real or personal property.
Held: The SC ruled that it is personal property. The SC relied on
its ruling in Tumalad v. Vicencio, that if a house of strong materials
can be the subject of a Chattel Mortgage as long as the parties to
the contract agree and no innocent 3rd party will be prejudiced
then more so that a machinery may treated as a movable since it
is movable by nature and becomes immobilized only by
destination. And treating it as a chattel by way of a Chattel
Mortgage, Wearever is estopped from claiming otherwise.
CO., INC.
G.R. No. L-11139
April 23, 1958
Concepcion, J.
Issue: Can an agreement to subject a house to a chattel mortgage
binding upon third persons?
Held: No. It is true that the parties to a deed of chattel mortgage
may agree to consider a house as personal property for purposes
of said contract However, this view is good only insofar as the
contracting parties are concerned. It is based, partly, upon the
principle of estoppel. Neither this principle, nor said view, is
applicable to strangers to said contract. Much less is it in point
where there has been no contract whatsoever, with respect to the
status of the house involved, as in the case at bar.
_____________________________________________________
TSAI v. COURT OF APPEALS
G.R. No. 120098
October 2, 2001
Quisumbing, J.
Issue: Whether or not the acquired machineries should be
considered as Chattels or Real Properties.
Held: Petitioners contend that the nature of the disputed
machineries, i.e., that they were heavy, bolted or cemented on the
real property mortgaged by EVERTEX to PBCom, make them ipso
facto immovable under Article 415 (3) and (5) of the New Civil
Code. This assertion, however, does not settle the issue. Mere
nuts and bolts do not foreclose the controversy. We have to look
at the parties' intent.
While it is true that the controverted properties appear to be
immobile, a perusal of the contract of Real and Chattel Mortgage
executed by the parties herein gives us a contrary indication. In
the case at bar, both the trial and the appellate courts reached the
same finding that the true intention of PBCOM and the owner,
EVERTEX, is to treat machinery and equipment as chattels.
In the absence of any showing that this conclusion is baseless,
erroneous or uncorroborated by the evidence on record, we find
no compelling reason to depart therefrom.
Too, assuming arguendo that the properties in question are
immovable by nature, nothing detracts the parties from treating it
as chattels to secure an obligation under the principle of estoppel.
As far back as Navarro v. Pineda, 9 SCRA 631 (1963), an
immovable may be considered a personal property if there is a
stipulation as when it is used as security in the payment of an
obligation where a chattel mortgage is executed over it, as in the
case at bar.
_____________________________________________________
SERG’S PRODUCTS, INC. vs. PCI LEASING AND FINANCE,
INC.
G.R. No. 137705.
August 22, 2000
Panganiban, J.:
ISSUE: Whether the machineries purchased, imported and
installed by Petitioner became real property by virtue of
immobilization.
HELD: No. Petitioners installed the machines subject of the writ of
seizure in the factory built on their own land for use in the
chocolate-making industry. While each machine by itself is a
movable or personal property, together these may be treated as
immovable by destination being essential and principal elements
in petitioner’s industry.
Article 415 (5) of the Civil Code classifies as real property,
“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.”
However, the contracting parties may validly stipulate that real
property be considered as personal. 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.”
Since the petitioners agreed to the above-quoted stipulation, they
should not be allowed to claim otherwise on the principle of
estoppel. A party to a contract is ordinarily precluded from denying
the truth of any material fact found therein. The machines in this
case are personal properties capable of being subjects of a Writ of
Replevin.
_____________________________________________________
BURGOS v. CHIEF OF STAFF
G.R. No. L-64261
Dec. 26, 1984
Escolin, J.
Issue: Whether or not the properties seized under the disputed
search warrants were immovable properties, thus making them
unsusceptible to seizure under such warrants.
Held: No. Under Article 415[5] of the Civil Code of the Philippines,
"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" are
considered immovable property. In Davao Sawmill Co. v. Castillo,
the Court ruled that machinery which is movable by nature
becomes immobilized when placed by the owner of the tenement,
property or plant, but not so when placed by a tenant,
usufructuary, or any other person having only a temporary right,
unless such person acted as the agent of the owner.
Petitioners did not claim to be the owners of the land and/or
building on which the printing machineries were placed. This being
the case, the machineries in question, while in fact bolted to the
ground remain movable property susceptible to seizure under a
search warrant.
_____________________________________________________
LOPEZ v OROSA
G.R. Nos. L-10817-18
February 28, 1958
FELIX, J.:
Issue: Whether real estate or immovable property mean land and
building?
Held: No. We cannot subscribe to this view, for while it is true that
generally, real estate connotes the land and the building
constructed thereon, it is obvious that the inclusion of the building,
separate and distinct from the land, in the enumeration of what
may constitute real propertie could mean only one thing — that a
building is by itself an immovable property, a doctrine already
pronounced by this Court in the case of Leung Yee vs. Strong
Machinery Co. Moreover, and in view of the absence of any
specific provision of law to the contrary, a building is an
immovable property, irrespective of whether or not said structure
and the land on which it is adhered to belong to the same owner.
_____________________________________________________
JULIAN S. YAP vs. HON. SANTIAGO O. TAÑADA, etc., and
GOULDS PUMPS INTERNATIONAL (PHIL.), INC.
G.R. No. L-32917
July 18, 1988
NARVASA, J.:
ISSUE: Whether or not the water pump had become immovable
property by its being installed in petitioner’s residence.
HELD: Yap's next argument that the water pump had become
immovable property by its being installed in his residence is also
untenable. The Civil Code considers as immovable property,
among others, anything "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
pump does not fit this description. It could be, and was in fact
separated from Yap's premises without being broken or suffering
deterioration. Obviously the separation or removal of the pump
involved nothing more complicated than the loosening of bolts or
dismantling of other fasteners.
Yap's last claim is that in the process of the removal of the pump
from his house, Goulds' men had trampled on the plants growing
there, destroyed the shed over the pump, plugged the exterior
casings with rags and cut the electrical and conduit pipes; that he
had thereby suffered actual-damages in an amount of not less
than P 2,000.00, as well as moral damages in the sum of P
10,000.00 resulting from his deprivation of the use of his water
supply; but the Court had refused to allow him to prove these acts
and recover the damages rightfully due him. Now, as to the loss of
his water supply, since this arose from acts legitimately done, the
seizure on execution of the water pump in enforcement of a final
and executory judgment, Yap most certainly is not entitled to claim
moral or any other form of damages thereof.
_____________________________________________________
MACHINERY & ENGINEERING SUPPLIES, INC. vs. CA
G.R. No. L-7057
October 29, 1954
CONCEPCION, J.:
ISSUE: Whether or not an action for replevin is the proper remedy
to recover machinery and equipment classified as real properties.
HELD: No. The special civil action known as replevin, governed by
Rule 62 of Court, is applicable only to "personal property".
Ordinarily replevin may be brought to recover any specific
personal property unlawfully taken or detained from the owner
thereof, provided such property is capable of identification and
delivery; but replevin will not lie for the recovery of real property or
incorporeal personal property. (77 C. J. S. 17)
When the sheriff repaired to the premises of respondent, Ipo
Limestone Co., Inc., machinery and equipment appeared to be
attached to the land, particularly to the concrete foundation of said
premises, in a fixed manner, in such a way that the former could
not be separated from the latter "without breaking the material or
deterioration of the object." Moreover, said machinery and
equipment were "intended by the owner of the tenement for an
industry" carried on said immovable and tended." For these
reasons, they were already immovable property pursuant to
paragraphs 3 and 5 of Article 415 of Civil Code of the Philippines.
As such immovable property, they were not subject to replevin.
However, the Supreme Court noted and affirmed the decision of
CA stating that:
The question of ownership and the applicability of Art. 415 of the
new Civil Code are immaterial in the determination of the only
issue involved in this case. The question as to whether the
machinery or equipment in litigation are immovable or not is
likewise immaterial, because the only issue raised before the trial
court was whether the Provincial Sheriff of Bulacan, at the
Petitioner's instance, was justified in destroying the machinery and
in refusing to restore them to their original form, at the expense of
the Petitioner.
_____________________________________________________
Laurel v. Garcia
G.R. No. 92013
July 25, 1990
Gutierrez, JR., J.:
Issue: Can the Roppongi property and others of its kind be
alienated by the Philippine Government?
Held: NO. The nature of the Roppongi lot as property for public
service is expressly spelled out. It is dictated by the terms of the
Reparations Agreement and the corresponding contract of
procurement which bind both the Philippine government and the
Japanese government.
There can be no doubt that it is of public dominion unless it is
convincingly shown that the property has become patrimonial.
As property of public dominion, the Roppongi lot is outside the
commerce of man. It cannot be alienated. Its ownership is a
special collective ownership for general use and enjoyment, an
application to the satisfaction of collective needs, and resides in
the social group. The purpose is not to serve the State as a
juridical person, but the citizens; it is intended for the common and
public welfare and cannot be the object of appropration. Articles
419-421 of the Civil Code apply.
Issue: Does the Chief Executive, her officers and agents, have the
authority and jurisdiction, to sell the Roppongi property?
Held: NO. There is no law authorizing its conveyance. It is not for
the President to convey valuable real property of the government
on his or her own sole will. Any such conveyance must be
authorized and approved by a law enacted by the Congress. It
requires executive and legislative concurrence.
Resolution No. 55 of the Senate dated June 8, 1989, asking for
the deferment of the sale of the Roppongi property does not
withdraw the property from public domain much less authorize its
sale. It is a mere resolution; it is not a formal declaration
abandoning the public character of the Roppongi property. In fact,
the Senate Committee on Foreign Relations is conducting
hearings on Senate Resolution No. 734 which raises serious
policy considerations and calls for a fact-finding investigation of
the circumstances behind the decision to sell the Philippine
government properties in Japan.
_____________________________________________________
RABUCO v. VILLEGAS
G.R. No. L-24661
February 28, 1974
TEEHANKEE, J.
Issue: Whether or not Republic Act 3120 is constitutional.
Held: Yes. Respondents city officials' contention that the Act must
be stricken down as unconstitutional for depriving the city of
Manila of the lots in question and providing for their sale in
subdivided small lots to bona fide occupants or tenants without
payment of just compensation is untenable and without basis,
since the lots in question are manifestly owned by the city in its
public and governmental capacity and are therefore public
property over which Congress had absolute control as
distinguished from patrimonial property owned by it in its private or
proprietary capacity of which it could not be deprived without due
process and without just compensation.
Here, Republic Act 3120 expressly declared that the properties
were "reserved as communal property" and ordered their
conversion into "disposable and alienable lands of the State" for
sale in small lots to the bona fide occupants thereof. It is
established doctrine that the act of classifying State property calls
for the exercise of wide discretionary legislative power which will
not be interfered with by the courts.
The Court in a case reaffirmed the established general rule that
"regardless of the source or classification of land in the possession
of a municipality, excepting those acquired with its own funds in its
private or corporate capacity, such property is held in trust for the
State for the benefit of its inhabitants, whether it be for
governmental or proprietary purposes. It holds such lands subject
to the paramount power of the legislature to dispose of the same,
for after all it owes its creation to it as an agent for the
performance of a part of its public work, the municipality being but
a subdivision or instrumentality thereof for purposes of local
administration. Accordingly, the legal situation is the same as if the
State itself holds the property and puts it to a different use" and
stressed that "the property, as has been previously shown, was
not acquired by the City of Manila with its own funds in its private
or proprietary capacity. That it has in its name a registered title is
not questioned, but this title should be deemed to be held in trust
for the State as the land covered thereby was part of the territory
of the City of Manila granted by the sovereign upon its creation."
There as here, the Court holds that the Acts in question (Republic
Acts 4118 in Salas and Republic Act 3120 in the case at bar) were
intended to implement the social justice policy of the Constitution
and the government program of land for the landless and that they
were not "intended to expropriate the property involved but merely
to confirm its character as communal land of the State and to
make it available for disposition by the National Government: ...
The subdivision of the land and conveyance of the resulting
subdivision lots to the occupants by Congressional authorization
does not operate as an exercise of the power of eminent domain
without just compensation in violation of Section 1, subsection (2),
Article III of the Constitution, but simply as a manifestation of its
right and power to deal with state property."
_____________________________________________________
MACASIANO v. DIOKNO
G.R. No. 97764
August 10, 1992
Medialdea, J.:
ISSUE: Is the disputed municipal ordinance authorizing the flea
market on the public streets valid?
HELD: Properties of the local government which are devoted to
public service are deemed public and are under the absolute
control of Congress. Hence, local governments have no authority
whatsoever to control or regulate the use of public properties
unless specific authority is vested upon them by Congress. One
such example of this authority given by Congress to the local
governments is the power to close roads as provided in Section
10, Chapter II of Blg. 337, known as Local Government Code,
which should be read and interpreted in accordance with basic
principles already established by law. These basic principles have
the effect of limiting such authority of the province, city or
municipality to close a public street or thoroughfare. Article 424 of
the Civil Code lays down the basic principle that properties of
public dominion devoted to public use and made available to the
public in general are outside the commerce of man and cannot be
disposed of or leased by the local government unit to private
persons. Aside from the requirement of due process which should
be complied with before closing a road, street or park, the closure
should be for the sole purpose of withdrawing the road or other
public property from public use when circumstances show that
such property is no longer intended or necessary for public use or
public service. When it is already withdrawn from public use, the
property then becomes patrimonial property of the local
government unit concerned. It is only then that the respondent
municipality can use or convey them for any purpose for which
other real property belonging to the local unit concerned might be
lawfully used or conveyed. However, those roads and streets
which are available to the public in general and ordinarily used for
vehicular traffic are still considered public property devoted to
public use. In such case, the local government has no power to
use it for another purpose or to dispose of or lease it to private
persons.
_____________________________________________________
REPUBLIC OF THE PHILIPPINES v. THE COURT OF APPEALS
AND SPOUSES MARIO B. LAPIÑA AND FLOR DE VEGA
G.R. No. 108998
August 24, 1994
BIDIN, J.
Issue: Can a foreign national apply for registration of title over a
parcel of land which he acquired by purchase while still a citizen of
the Philippines, from a vendor who has complied with the
requirements for registration under the Public Land Act (CA 141)?
Held: Yes. The evidence thus presented established that
applicants, by themselves and their predecessors-in-interest, had
been in open, public, peaceful, continuous, exclusive and
notorious possession and occupation of the two adjacent parcels
of land applied for registration of title under a bona-fide claim of
ownership long before June 12, 1945. Such being the case, it is
conclusively presumed that all the conditions essential to the
confirmation of their title over the two adjacent parcels of land are
sought to be registered have been complied with thereby entitling
them to the issuance of the corresponding certificate of title
pursuant to the provisions of Presidential Decree No. 1529,
otherwise known as the Property Registration Decree.
It must be noted that with respect to possession and occupation of
the alienable and disposable lands of the public domain, the law
employs the terms "by themselves", "the applicant himself or
through his predecessor-in-interest". Thus, it matters not whether
the vendee/applicant has been in possession of the subject
property for only a day so long as the period and/or legal
requirements for confirmation of title has been complied with by
his predecessor-in-interest, the said period is tacked to his
possession. In the case at bar, respondents' predecessors-in-
interest have been in open, continuous, exclusive and notorious
possession of the disputed land not only since June 12, 1945, but
even as early as 1937. Petitioner does not deny this except that
respondent spouses, in its perception, were in possession of the
land sought to be registered only in 1978 and therefore short of
the required length of time. As aforesaid, the disputed parcels of
land were acquired by private respondents through their
predecessors-in-interest, who, in turn, have been in open and
continued possession thereof since 1937. Private respondents
stepped into the shoes of their predecessors-in-interest and by
virtue thereof, acquired all the legal rights necessary to confirm
what could otherwise be deemed as an imperfect title.
_____________________________________________________
The Province of Zamboanga Del Norte VS. City of Zamboanga
G.R. No. L-24440
28 March 1968
Bengzon, J:
ISSUE: Which of the two norms, i.e., that of the Civil Code or that
obtaining under the law of Municipal Corporations, must be used
in classifying the 50 lots in question?
HELD: The Law on Municipal Corporation should be followed.
Under the Civil Code, to be of public property, they should fall
under the phrase "public works for public service" for it has been
held that under the ejusdem generis rule, such public works must
be for free and indiscriminate use by anyone, just like the
preceding enumerated properties in the first paragraph of Art 424.
( Hence, even the hospitals and schools cannot be considered as
public properties.) Unlike in the classification regarding State
properties, properties for public service in the municipalities are
not classified as public.
However, the Law on Municipal Corporation provides that to be
considered public, it is enough that the property be held and
devoted for governmental purposes like local administration,
public education, public health, etc.
Supporting jurisprudence are found in the following cases: (1)
HINUNANGAN V. DIRECTOR OF LANDS, where it was stated
that "... where the municipality has occupied lands distinctly for
public purposes, such as for the municipal court house, the public
school, the public market, or other necessary municipal building,
we will, in the absence of proof to the contrary, presume a grant
from the States in favor of the municipality; but, as indicated by the
wording, that rule may be invoked only as to property which is
used distinctly for public purposes...." (2) VIUDA DE TANTOCO V.
MUNICIPAL COUNCIL OF ILOILO held that municipal properties
necessary for governmental purposes are public in nature. Thus,
the auto trucks used by the municipality for street sprinkling, the
police patrol automobile, police stations and concrete structures
with the corresponding lots used as markets were declared
exempt from execution and attachment since they were not
patrimonial properties. (3) MUNICIPALITY OF BATANGAS VS.
CANTOS held squarely that a municipal lot which had always
been devoted to school purposes is one dedicated to public use
and is not patrimonial property of a municipality.
_____________________________________________________
CHAVEZ vs. PUBLIC ESTATES AUTHORITY
G.R. No. 133250
July 9, 2002
Carpio, J.
ISSUES:
1. Are reclaimed lands comprising the Freedom Islands
alienable or disposable lands of the public domain?
2. Are submerged areas of the Manila Bay alienable and
disposable lands of the public domain?
3. Can AMARI, a private corporation, acquire and own
under the Amended JVA, 367.5 hectares of reclaimed foreshore
and submerged areas in Manila Bay?
HELD:
1. YES. The reclaimed lands comprising the Freedom
Islands were held by the Court to be alienable and disposable
lands of the public domain.
Under Section 2, Article XII of the 1987 Constitution, the foreshore
and submerged areas of Manila Bay are part of the "lands of the
public domain, waters x x x and other natural resources" and
consequently "owned by the State." As such, foreshore and
submerged areas "shall not be alienated," unless they are
classified as "agricultural lands" of the public domain. The mere
reclamation of these areas by PEA does not convert these
inalienable natural resources of the State into alienable or
disposable lands of the public domain. There must be a law or
presidential proclamation officially classifying these reclaimed
lands as alienable or disposable and open to disposition or
concession. Moreover, these reclaimed lands cannot be classified
as alienable or disposable if the law has reserved them for some
public or quasi-public use.
Section 8 of CA No. 141 provides that "only those lands shall be
declared open to disposition or concession which have been
officially delimited and classified." The President has the authority
to classify inalienable lands of the public domain into alienable or
disposable lands of the public domain, pursuant to Section 6 of CA
No. 141.
PD No. 1085, coupled with President Aquino's actual issuance of
a special patent covering the Freedom Islands, is equivalent to an
official proclamation classifying the Freedom Islands as alienable
or disposable lands of the public domain. PD No. 1085 and
President Aquino's issuance of a land patent also constitute a
declaration that the Freedom Islands are no longer needed for
public service. The Freedom Islands are thus alienable or
disposable lands of the public domain, open to disposition or
concession to qualified parties.
At the time then President Aquino issued Special Patent No. 3517,
PEA had already reclaimed the Freedom Islands although
subsequently there were partial erosions on some areas. The
government had also completed the necessary surveys on these
islands. Thus, the Freedom Islands were no longer part of Manila
Bay but part of the land mass. Section 3, Article XII of the 1987
Constitution classifies lands of the public domain into "agricultural,
forest or timber, mineral lands, and national parks." Being neither
timber, mineral, nor national park lands, the reclaimed Freedom
Islands necessarily fall under the classification of agricultural lands
of the public domain. Under the 1987 Constitution, agricultural
lands of the public domain are the only natural resources that the
State may alienate to qualified private parties. All other natural
resources, such as the seas or bays, are "waters x x x owned by
the State" forming part of the public domain, and are inalienable
pursuant to Section 2, Article XII of the 1987 Constitution.
2. NO. The submerged areas of the Manila Bay were held to
be inalienable and outside the commerce of man until classified as
alienable or disposable lands open to disposition and declared no
longer needed for public service.
CA No. 141 requires that lands of the public domain must first be
classified as alienable or disposable before the government can
alienate them. These lands must not be reserved for public or
quasi-public purposes. Presidential Decree No. 3-A, issued on
January 11, 1973, revoked all laws authorizing the reclamation of
areas under water and revested solely in the National Government
the power to reclaim lands.
Executive Order No. 525, issued on February 14, 1979,
designated PEA as the National Government's implementing arm
to undertake "all reclamation projects of the government," which
"shall be undertaken by the PEA or through a proper contract
executed by it with any person or entity." Under such contract, a
private party receives compensation for reclamation services
rendered to PEA. Payment to the contractor may be in cash, or in
kind consisting of portions of the reclaimed land, subject to the
constitutional ban on private corporations from acquiring alienable
lands of the public domain.
The Amended JVA covers not only the Freedom Islands, but also
an additional 592.15 hectares which are still submerged and
forming part of Manila Bay. There is no legislative or Presidential
act classifying these submerged areas as alienable or disposable
lands of the public domain open to disposition. These submerged
areas are not covered by any patent or certificate of title. There
can be no dispute that these submerged areas form part of the
public domain, and in their present state are inalienable and
outside the commerce of man. Until reclaimed from the sea, these
submerged areas are, under the Constitution, "waters x x x owned
by the State," forming part of the public domain and consequently
inalienable. Only when actually reclaimed from the sea can these
submerged areas be classified as public agricultural lands, which
under the Constitution are the only natural resources that the
State may alienate. Once reclaimed and transformed into public
agricultural lands, the government may then officially classify
these lands as alienable or disposable lands open to disposition.
Thereafter, the government may declare these lands no longer
needed for public service. Only then can these reclaimed lands be
considered alienable or disposable lands of the public domain and
within the commerce of man.
Section 3 of EO No. 525, by declaring that all lands reclaimed by
PEA "shall belong to or be owned by the PEA," could not
automatically operate to classify inalienable lands into alienable or
disposable lands of the public domain. Otherwise, reclaimed
foreshore and submerged lands of the public domain would
automatically become alienable once reclaimed by PEA, whether
or not classified as alienable or disposable.
3. NO. Since the Amended JVA seeks to transfer to AMARI, a
private corporation, ownership of 77.34 hectares of the Freedom
Islands, such transfer is void for being contrary to Section 3,
Article XII of the 1987 Constitution which prohibits private
corporations from acquiring any kind of alienable land of the public
domain. Furthermore, Since the Amended JVA also seeks to
transfer to AMARI ownership of 290.156 hectares of still
submerged areas of Manila Bay, such transfer is void for being
contrary to Section 2, Article XII of the 1987 Constitution which
prohibits the alienation of natural resources other than agricultural
lands of the public domain.
_____________________________________________________
Villarico v. Sarmiento
G.R. No. 136438
November 11, 2004
SANDOVAL-GUTIERREZ, J.:
Issues:
1. What is contemplated by the phrase "intended for public use" in
Article 420?
2. What are the effects if a property is of public dominion?
Held:
1. Public use is “use that is not confined to privileged individuals,
but is open to the indefinite public.”
Applying this to the instant case, the lot under scrutiny consists of
stairways which were built for the use of the people as
passageway to the highway. Consequently, it is a property of
public dominion.
2. Property of public dominion is outside the commerce of man
and hence it: (1) cannot be alienated or leased or otherwise be
the subject matter of contracts; (2) cannot be acquired by
prescription against the State; (3) is not subject to attachment and
execution; and (4) cannot be burdened by any voluntary
easement.
Applying this in this case, considering that the lot on which the
stairways were constructed is a property of public dominion, it
cannot be burdened by a voluntary easement of right of way,
which the petitioner here is claiming. In fact, its use by the public
is by mere tolerance of the government through the DPWH.
Petitioner cannot appropriate it for himself. Verily, he cannot claim
any right of possession over it.
_____________________________________________________
OWNERSHIP
JAVIER v. VERIDIANO II
G.R. No. L-48050
October 10, 1994
Bellosillo, J.
Issue: Whether or not a prior case of forcible entry is res judicata
upon the second case on quieting of title.
Held: No. In a complaint for forcible entry, what is at issue is prior
possession, regardless of who has lawful title over the disputed
property. The only issue in an action for forcible entry is the
physical or material possession of real property, that is,
possession de facto and not possession de jure. The philosophy
underlying this remedy is that irrespective of the actual condition
of the title to the property, the party in peaceable quiet possession
shall not be turned out by strong hand, violence or terror. A
judgment rendered in a case for recovery of possession is
conclusive only on the question of possession and not on the
ownership. It does not in any way bind the title or affect the
ownership of the land or building; a judgment in forcible entry or
detainer case disposes of no other issue than possession and
declares only who has the right of possession, but by no means
constitutes a bar to an action for determination of who has the
right or title of ownership.
_____________________________________________________
SPOUSES BUSTOS V. CA
G.R. No 120784-85
January 24, 2001
Pardo, J.
Issue: Can petitioners be ejected from their own land?
Held: No. Admittedly, the decision in the ejectment case is final
and executory. However, the ministerial duty of a court to order
execution of a final and executory judgment admits of exceptions
such as where it becomes imperative in the higher interest of
justice to direct suspension of the execution of the judgment, or
whenever necessary to accomplish the aims of justice, or when
certain facts and circumstances transpired after the judgment
became final, which would render execution of the judgment
unjust.
In the present case, the stay of execution is warranted because
petitioners are now legal owners of the land in question and are
occupants thereof. To eject petitioners would then result to grave
injustice. Placing petitioners in the possession of the land in
question is a necessary and logical consequence of the decision
declaring them as rightful owners of the property. One of the
essential attributes of ownership is possession. An owner, who
cannot exercise the “seven juses” or attributes of ownership, is a
crippled owner.
_____________________________________________________
SORIANO vs. CA
G.R. No. 128177
August 15, 2001
YNARES-SANTIAGO, J.:
Issue: May a winning party in a land registration case effectively
eject the possessor thereof, whose security of tenure rights are
still pending determination before the DARAB?
Held: No. Possession and ownership are distinct legal concepts.
There is ownership when a thing pertaining to one person is
completely subjected to his will in a manner not prohibited by law
and consistent with the rights of others. Ownership confers
certain rights to the owner, among which are the right to enjoy the
thing owned and the right to exclude other persons from
possession thereof. On the other hand, possession is defined as
the holding of a thing or the enjoyment of a right. Literally, to
possess means to actually and physically occupy a thing with or
without right. Possession may be had in one of two ways:
possession in the concept of an owner and possession of a
holder. A person may be declared owner but he may not be
entitled to possession. The possession may be in the hands of
another either as a lessee or a tenant. A person may have
improvements thereon of which he may not be deprived without
due hearing. He may have other valid defenses to resist
surrender of possession. A judgment for ownership, therefore,
does not necessarily include possession as a necessary incident.
There is no dispute that private respondents’ (petitioners below)
title over the land under litigation has been confirmed with finality.
As explained above, however, such declaration pertains only to
ownership and does not automatically include possession,
especially so in the instant case where there is a third party
occupying the said parcel of land, allegedly in the concept of an
agricultural tenant.
GARCIA vs. COURT OF APPEALS
G.R. No. 133140
August 10, 1990
Puno, J.
Issue: Whether Garcia’s possession is in a concept of an owner?
Held: No. Garcia’s possession which started only in 1986 could
not ripen into ownership. He has no valid title thereto. His
possession in fact was that of an intruder, one done in bad faith (to
defeat PBCom’s Writ of Possession). His possession is certainly
not in the concept of an owner. This is so because as early as
1981, title thereto was registered in the name of the Magpayo
Spouses which title was subsequently cancelled when the
property was purchased by PBCom in a public auction sale
resulting in the issuance of title in favor of the latter in 1985.The
Court stressed that possession and ownership are distinct legal
concepts. Ownership exists when a thing pertaining to one person
is completely subjected to his will in a manner not prohibited by
law and consistent with the rights of others. Ownership confers
certain rights to the owner, one of which is the right to dispose of
the thing by way of sale. Atty. Pedro Garcia and his wife
Remedios exercised their right to dispose of what they owned
when they sold the subject property to the Magpayo spouses. On
the other hand, possession is defined as the holding of a thing or
the enjoyment of a right. Literally, to possess means to actually
and physically occupy a thing with or without right. Possession
may be had in one of two ways: possession in the concept of an
owner and possession of a holder. A possessor in the concept of
an owner may be the owner himself or one who claims to be so.
On the other hand, one who possesses as a mere holder
acknowledges in another a superior right which he believes to be
ownership, whether his belief be right or wrong.The records show
that petitioner occupied the property not in the concept of an
owner for his stay was merely tolerated by his parents.
Consequently, it is of no moment that petitioner was in possession
of the property at the time of the sale to the Magpayo spouses. It
was not a hindrance to a valid transfer of ownership. On the other
hand, petitioner’s subsequent claim of ownership as successor to
his mother’s share in the conjugal asset is belied by the fact that
the property was not included in the inventory of the estate
submitted by his father to the intestate court. This buttresses the
ruling that indeed the property was no longer considered owned
by petitioner’s parents.
 The Court upheld the Court of Appeals in
holding that the mortgage to PBCom by the Magpayo spouses is
valid notwithstanding that the transfer certificate of title over the
property was issued to them after the mortgage contract was
entered into. Registration does not confer ownership, it is merely
evidence of such ownership over a particular property. The deed
of sale operates as a formal or symbolic delivery of the property
sold and authorizes the buyer to use the document as proof of
ownership. All said, the Magpayo spouses were already the
owners when they mortgaged the property to PBCom.
_____________________________________________________
RODIL ENTERPRISES, INC. vs. COURT OF APPEALS
G.R. No. 129609
November 29, 2001
BELLOSILLO, J.:
Issue: Whether or not the renewal of contract of lease between
Rodil and the Republic is valid.
Held: Yes. The owner has the right to enjoy and dispose of a
thing, without other limitations than those established by law.
Every owner has the freedom of disposition over his property. It is
an attribute of ownership, and this rule has no exception. The
REPUBLIC being the owner of the disputed property enjoys the
prerogative to enter into a lease contract with RODIL in the
exercise of its jus disponendi. Hence, as lessor, the REPUBLIC
has the right to eject usurpers of the leased property where the
factual elements required for relief in an action for unlawful
detainer are present.
Issue: Whether or not Rodil may validly eject herein respondents
even though the former is not in actual possession of the property.
Held: Yes. In an action for unlawful detainer the plaintiff need not
have been in prior physical possession. Respondents have
admitted that they have not entered into any lease contract with
the REPUBLIC and that their continued occupation of the subject
property was merely by virtue of acquiescence. Since the
occupation of respondents was merely tolerated by the
REPUBLIC, the right of possession of the latter remained
uninterrupted. It could therefore alienate the same to anyone it
chose. Unfortunately for respondents, the REPUBLIC chose to
alienate the subject premises to RODIL by virtue of a contract of
lease entered into on 18 May 1992. Resultantly, petitioner had the
right to file the action for unlawful detainer against respondents as
one from whom possession of property has been unlawfully
withheld.
_____________________________________________________
ISAGUIRRE v. DE LARA
G.R. No. 138053
May 31, 2000
Gonzaga – Reyes, J.
Issue: Does the mortgagee in an equitable mortgage have the
right to retain possession of the property pending actual payment
to him of the amount of indebtedness by the mortgagor?
Held: No. A mortgage is a contract entered into in order to secure
the fulfillment of a principal obligation. Recording the document, in
which it appears with the proper Registry of Property, although,
even if it is not recorded, the mortgage is nevertheless binding
between the parties, constitutes it. Thus, the only right granted by
law in favor of the mortgagee is to demand the execution and the
recording of the document in which the mortgage is formalized. As
a general rule, the mortgagor retains possession of the mortgaged
property since a mortgage is merely a lien and title to the property
does not pass to the mortgagee. However, even though a
mortgagee does not have possession of the property, there is no
impairment of his security since the mortgage directly and
immediately subjects the property upon which it is imposed,
whoever the possessor may be, to the fulfillment of the obligation
for whose security it was constituted. If the debtor is unable to pay
his debt, the mortgage creditor may institute an action to foreclose
the mortgage, whether judicially or extrajudicially, whereby the
mortgaged property will then be sold at a public auction and the
proceeds there from given to the creditor to the extent necessary
to discharge the mortgage loan. Apparently, petitioner’s contention
that “to require him to deliver possession of the Property to
respondent prior to the full payment of the latter’s mortgage loan
would be equivalent to the cancellation of the mortgage is without
basis. Regardless of its possessor, the mortgaged property may
still be sold, with the prescribed formalities, in the event of the
debtor’s default in the payment of his loan obligation.
A simple mortgage does not give the mortgagee a right to the
possession of the property unless the mortgage should contain
some special provision to that effect. Regrettably for petitioner, he
has not presented any evidence, other than his own gratuitous
statements, to prove that the real intention of the parties was to
allow him to enjoy possession of the mortgaged property until full
payment of the loan.
The trial court correctly issued the writ of possession in favor of
respondent. Such writ was but a necessary consequence of
affirming the validity of the original certificate of title in the name of
respondent Felicitas de Lara, while at the same time nullifying the
original certificate of title in the name of petitioner Cornelio
Isaguirre. Possession is an essential attribute of ownership; thus,
it would be redundant for respondent to go back to court simply to
establish her right to possess subject property.
_____________________________________________________
SPOUSES CRISTINO and BRIGIDA CUSTODIO and SPOUSES
LITO and MARIA CRISTINA SANTOS v. COURT OF APPEALS,
HEIRS OF PACIFICO C. MABASA and REGIONAL TRIAL
COURT OF PASIG, METRO MANILA, BRANCH 181
G.R. No. 116100
February 9, 1996
REGALADO, J.
Issue: Can a damage not amounting to a legal injury suffered by
tenants be actionable against the property owner?
Held: No. In the case at bar, although there was damage, there
was no legal injury. Contrary to the claim of private respondents,
petitioners could not be said to have violated the principle of
abuse of right. In order that the principle of abuse of right provided
in Article 21 of the Civil Code can be applied, it is essential that
the following requisites concur: (1) The defendant should have
acted in a manner that is contrary to morals, good customs or
public policy; (2) The acts should be willful; and (3) There was
damage or injury to the plaintiff.
The act of petitioners in constructing a fence within their lot is a
valid exercise of their right as owners, hence not contrary to
morals, good customs or public policy. The law recognizes in the
owner the right to enjoy and dispose of a thing, without other
limitations than those established by law.16 It is within the right of
petitioners, as owners, to enclose and fence their property. Article
430 of the Civil Code provides that "(e)very owner may enclose or
fence his land or tenements by means of walls, ditches, live or
dead hedges, or by any other means without detriment to
servitudes constituted thereon."
_____________________________________________________
ABEJARON vs. NABASA
G.R. No. 84831
June 20, 2001
Puno, J.
Issue: Whether or not the petitioner had the legal title of ownership
in accordance with the applicable law.
Held: No. Sec. 4 of PD 1073 reads:
"Sec. 4. The provision of Section 48(b) and Section 48(c),
Chapter VIII, of the Public Land Act, are hereby amended in the
sense that these provisions shall apply only to alienable and
disposable lands of the public domain which have been in open,
continuous, exclusive and notorious possession and occupation
by the applicant himself or thru his predecessor-in-interest, under
a bona fide claim of acquisition of ownership, since June 12,
1945.”
Sec. 48(b) of the Public Land Act, as further amended by P.D. No.
1073, now reads:
"(b) Those who by themselves or through their predecessors-in-
interest have been in open, continuous, exclusive and notorious
possession and occupation of agricultural lands of the public
domain, under a bona fide claim of acquisition or ownership, since
June 12, 1945, or earlier, immediately preceding the filing of the
application for confirmation of title, except when prevented by
wars or force majeure. Those shall be conclusively presumed to
have performed all the conditions essential to a Government grant
and shall be entitled to a certificate of title under the provisions of
this chapter."
However, as Abejaron’s 30-year period of possession and
occupation required by the Public Land Act, ran from 1945 to
1975, prior to the effectivity of PD 1073 in 1977, the requirement
that occupation and possession should have started on June 12,
1945, or earlier, does not apply to him.
Petitioner claims that he started occupying the disputed land in
1945. At that time, he built a nipa house, a small store, and a
fence made of wood to delineate his area. This nipa house was
improved in 1949 into a two-storey house. The small store was
also made bigger in 1950. The wooden fence was also changed
to a fence made of hollow blocks. The two-storey house, bigger
store, and hollow-block fence all stand to this day. In 1951,
petitioner planted coconut trees near his house. While the
petitioner has shown continued existence of these improvements
on the disputed land, they were introduced later than January 24,
1947. He has failed to establish the portion of the disputed land
that his original nipa house, small store and wooden fence actually
occupied as of January 24, 1947. In the absence of this proof, we
cannot determine the land he actually possessed and occupied for
thirty years which he may acquire under Sec. 48(b) of the Public
Land Act. Worthy of notice is the fact that the disputed land was
surveyed, subdivided into and identified by lots only in the 1970's.
Therefore, prior to the survey, it would be difficult to determine the
metes and bounds of the land petitioner claims to have occupied
since 1947 in the absence of specific and incontrovertible proof.
Finally, as admitted by the petitioner, he has never declared the
disputed land for taxation purposes. While tax receipts and tax
declarations are not incontrovertible evidence of ownership, they
become strong evidence of ownership acquired by prescription
when accompanied by proof of actual possession of the property
or supported by other effective proof. Even the tax declarations
and receipts covering his house do not bolster his case as the
earliest of these was dated 1950.
GERMAN MANAGEMENT & SERVICES, INC v. CA
G.R. No. 76216 - 76217
September 14, 1989
FERNAN, C.J.
Issue: Whether or not petitioner may validly invoke the doctrine of
self help.
Held: No. Both the Municipal Trial Court and the Regional Trial
Court have rationalized petitioner's drastic action of bulldozing and
destroying the crops of private respondents on the basis of the
doctrine of self-help enunciated in Article 429 of the New Civil
Code. Such justification is unavailing because the doctrine of self-
help can only be exercised at the time of actual or threatened
dispossession which is absent in the case at bar. When
possession has already been lost, the owner must resort to judicial
process for the recovery of property. This is clear from Article 536
of the Civil Code which states, "In no case may possession be
acquired through force or intimidation as long as there is a
possessor who objects thereto. He who believes that he has an
action or right to deprive another of the holding of a thing, must
invoke the aid of the competent court, if the holder should refuse
to deliver the thing."
_____________________________________________________
CAISIP v. PEOPLE
G.R. No. L-28716
November 18, 1970
Concepcion, C.J.
ISSUE: Whether the acts of appellants of stopping Gloria Cabalag
from weeding the land and failing to do so to forcibly dragged
Cabalag for about 8 meters towards a forested area justified under
Article 429 of the Civil Code?
HELD: No, their acts cannot be justified under Article 429 of the
Civil Code. The Court held that, Art. 429 of our Civil Code,
reading:
The owner or lawful possessor of a thing has the right to exclude
any person from the enjoyment and disposal thereof. For this
purpose, he may use such force as may be reasonably necessary
to repel or prevent an actual or threatened unlawful physical
invasion or usurpation of his property.
Upon which appellants rely is obviously inapplicable to the case at
bar, for, having been given 20 days from June 6, 1959, within
which to vacate Lot 105-A, complainant did not, on June 17, 1959
— or within said period — invade or usurp said lot. She had
merely remained in possession thereof, even though the hacienda
owner may have become its co-possessor. Appellants did not
"repel or prevent in actual or threatened ... physical invasion or
usurpation." They expelled Gloria from a property of which she
and her husband were in possession even before the action for
forcible entry was filed against them on May 17, 1958, despite the
fact that the Sheriff had explicitly authorized them to stay in said
property up to June 26, 1959, and had expressed the view that he
could not oust them therefrom on June 17, 1959, without a judicial
order therefor.
It is urged, that, by weeding and refusing to leave Lot 105-A,
Gloria had committed a crime in the presence of the policemen,
despite the aforementioned 20-day period, which, appellants
claim, the sheriff had no authority to grant. This contention is
manifestly untenable, because: (1) said period was granted in the
presence of the hacienda owner's representative, appellant Caisip,
who, by not objecting thereto, had impliedly consented to or
ratified the act performed by the sheriff; (2) Gloria and her
husband were thereby allowed to remain, and had, in fact,
remained, in possession of the premises, perhaps together with
the owner of the hacienda or his representative, Caisip; (3) the act
of removing weeds from the ricefield was beneficial to its owner
and to whomsoever the crops belonged, and, even if they had not
authorized it, does not constitute a criminal offense; and (4)
although Gloria and her husband had been sentenced to vacate
the land, the judgment against them did not necessarily imply that
they, as the parties who had tilled it and planted thereon, had no
rights, of any kind whatsoever, in or to the standing crops,
inasmuch as "necessary expenses shall be refunded to every
possessor," and the cost of cultivation, production and upkeep
has been held to partake of the nature of necessary expenses.
People v. Pletcha
G.R. No.19029
June 27, 1977.
Bison, J.
ISSUE: Whether or not Pletcha can properly invoked Article 429.
HELD: Yes. The principle of self-help authorizes the lawful
possessor to use force not only to prevent a threatened unlawful
invasion or usurpation thereof; it is sort of self-defense. It is lawful
to repel force by force. He who merely uses force to defend his
possession does not possess by force. The use of such necessary
force to protect proprietary or possessory rights constitutes a
justifying circumstance under our penal laws.
The appellant need not rush to court to seek redress before
reasonably resisting the invasion of property. The situation
required immediate action and Article 429 gave him the self-
executory mechanics of self-defense and self-reliance.
_____________________________________________________
Andamo vs. Intermediate Appellate Court
G.R. No. 74761
November 6, 1990
Fernan, C.J.
Issue: Whether petitioner spouses Andamo can claim damages
for destruction caused by respondent’s waterpaths and
contrivances on the basis of Articles 2176 and 2177 of the Civil
Code on quasi-delicts.
Held: Yes. A careful examination of the aforequoted complaint
shows that the civil action is one under Articles 2176 and 2177 of
the Civil Code on quasi-delicts. All the elements of a quasi-delict
are present, to wit: (a) damages suffered by the plaintiff, (b) fault
or negligence of the defendant, or some other person for whose
acts he must respond; and (c) the connection of cause and effect
between the fault or negligence of the defendant and the damages
incurred by the plaintiff.
Clearly, from petitioner’s complaint, the waterpaths and
contrivances built by respondent corporation are alleged to have
inundated the land of petitioners. There is therefore, an assertion
of a causal connection between the act of building these
waterpaths and the damage sustained by petitioners. Such action
if proven constitutes fault or negligence which may be the basis for
the recovery of damages.
It must be stressed that the use of one’s property is not without
limitations. Article 431 of the Civil Code provides that “the owner of
a thing cannot make use thereof in such a manner as to injure the
rights of a third person.” SIC UTERE TUO UT ALIENUM NON
LAEDAS. Moreover, adjoining landowners have mutual and
reciprocal duties which require that each must use his own land in
a reasonable manner so as not to infringe upon the rights and
interests of others. Although we recognize the right of an owner to
build structures on his land, such structures must be so
constructed and maintained using all reasonable care so that they
cannot be dangerous to adjoining landowners and can withstand
the usual and expected forces of nature. If the structures cause
injury or damage to an adjoining landowner or a third person, the
latter can claim indemnification for the injury or damage suffered.
_____________________________________________________
Andamo vs. Intermediate Appellate Court
G.R. No. 74761
November 6, 1990
Fernan, C.J.
Issue: Whether a land owner has the absolute right to do anything
with his property.
Held: No. It must be stressed that the use of one’s property is not
without limitations. Article 431 of the Civil Code provides that “the
owner of a thing cannot make use thereof in such a manner as to
injure the rights of a third person.” SIC UTERE TUO UT ALIENUM
NON LAEDAS. Moreover, adjoining landowners have mutual and
reciprocal duties which require that each must use his own land in
a reasonable manner so as not to infringe upon the rights and
interests of others. Although we recognize the right of an owner to
build structures on his land, such structures must be so
constructed and maintained using all reasonable care so that they
cannot be dangerous to adjoining landowners and can withstand
the usual and expected forces of nature. If the structures cause
injury or damage to an adjoining landowner or a third person, the
latter can claim indemnification for the injury or damage suffered.
_____________________________________________________
BACHRACH MOTOR CO., INC., vs. TALISAY-SILAY MILLING
CO., THE PHILIPPINE NATIONAL BANK
G.R. No. 35223
September 17, 1931
Romualdez, J.
Issue: Whether or not the bonus in question is civil fruits?
Held: NO.Article 355 of the Civil Code considers three things as
civil fruits: First, the rents of buildings; second, the proceeds from
leases of lands; and, third, the income from perpetual or life
annuities, or other similar sources of revenue. It may be noted that
according to the context of the law, the phrase "u otras analogas"
refers only to rent or income, for the adjectives "otras" and
"analogas" agree with the noun "rentas," as do also the other
adjectives "perpetuas" and "vitalicias." That is why we say that by
"civil fruits" the Civil Code understands one of three and only three
things, to wit: the rent of a building, the rent of land, and certain
kinds of income.
As the bonus in question is not rent of a building or of land, the
only meaning of "civil fruits" left to be examined is that of "income."
Assuming that in broad juridical sense of the word "income" it
might be said that the bonus in question is "income" under article
355 of the Civil Code, it is obvious to inquire whether it is derived
from the land mortgaged by Mariano Lacson Ledesma to the
appellant bank for the benefit of the central; for it is not obtained
from that land but from something else, it is not civil fruits of that
land, and the bank's contention is untenable.
It is to be noted that the said bonus bears no immediate, but only
a remote accidental relation to the land mentioned, having been
granted as compensation for the risk of having subjected one's
land to a lien in favor of the bank, for the benefit of the entity
granting said bonus. If this bonus be income or civil fruits of
anything, it is income arising from said risk, or, if one chooses,
from Mariano Lacson Ledesma's generosity in facing the danger
for the protection of the central, but certainly it is not civil fruits or
income from the mortgaged property, which, as far as this case is
concerned, has nothing to do with it. Hence, the amount of the
bonus, according to the resolution of the central granting it, is not
based upon the value, importance or any other circumstance of
the mortgaged property, but upon the total value of the debt
thereby secured, according to the annual balance, which is
something quite distinct from and independent of the property
referred to.
_____________________________________________________
EQUATORIAL REALTY DEVELOPMENT, INC. v. MAYFAIR
THEATER, INC.
G.R. No. 133879
November 21, 2001
Panganiban, J.
Issue: Whether or not Equatorial Realty Development, Inc. is
entitled to back rentals from Mayfair Theater, Inc. by virtue of the
Contract of Sale executed between Equatorial and Carmelo and
Bauermann, Inc. (former owner of the subject property).
Held: No. In the case, there was no right of ownership transferred
from Carmelo to Equatorial in view of a patent failure to deliver the
property to the buyer. By a contract of sale, “one of the contracting
parties obligates himself to transfer ownership of and to deliver a
determinate thing and the other to pay therefor a price certain in
money or its equivalent.” Ownership of the thing sold is a real
right, which the buyer acquires only upon delivery of the thing to
him “in any of the ways specified in articles 1497 to 1501, or in any
other manner signifying an agreement that the possession is
transferred from the vendor to the vendee.” This right is
transferred, not by contract alone, but by tradition or delivery. And
there is said to be delivery if and when the thing sold “is placed in
the control and possession of the vendee.” From the peculiar facts
of this case, it is clear that petitioner never took actual control and
possession of the property sold, in view of respondent’s timely
objection to the sale and the continued actual possession of the
property. While the execution of a public instrument of sale is
recognized by law as equivalent to the delivery of the thing sold,
such constructive or symbolic delivery, being merely presumptive,
is deemed negated by the failure of the vendee to take actual
possession of the land sold. In the case, Mayfair’s opposition to
the transfer of the property by way of sale to Equatorial was a
legally sufficient impediment that effectively prevented the passing
of the property into the latter's hands. Rent is a civil fruit that
belongs to the owner of the property producing it by right of
accession. Consequently and ordinarily, the rentals that fell due
from the time of the perfection of the sale to petitioner until its
rescission by final judgment should belong to the owner of the
property during that period. Not having been the owner, Equatorial
cannot be entitled to the civil fruits of ownership like rentals of the
thing sold.
_____________________________________________________
IGNACIO V. HILARIO
G.R. No. L-175
April 30, 1946
Moran, CJ
ISSUE: Whether or not the plaintiff are entitled to an order of
execution since they chose neither to pay defendants for the
buildings nor to sell to them the residential lot.
HELD: The owner of the building erected in good faith on a land
owned by another, is entitled to retain the possession of the land
until he is paid the value of his building, under article 453. The
owner of the land, upon the other hand, has the option, under
article 361, either to pay for the building or to sell his land to the
owner of the building. But he cannot, as respondents here did,
refuse both to pay for the building and to sell the land and compel
the owner of the building to remove it from the land where it is
erected. He is entitled to such remotion only when, after having
chosen to sell his land, the other party fails to pay for the same.
But this is not the case before us.
We hold, therefore, that the order of Judge Natividad compelling
defendants-petitioners to remove their buildings from the land
belonging to plaintiffs-respondents only because the latter chose
neither to pay for such buildings not to sell the land, is null and
void, for it amends substantially the judgment sought to be
executed and is, furthermore, offensive to articles 361 and 453 of
the Civil Code.
_____________________________________________________
IGNAO V. COURT OF APPEALS
G.R. No. 72876
January 18, 1991
FERNAN, C.J.
ISSUE #1: Are private respondents builders in good faith on the
land in question (thus applying Art. 448 of the Civil Code, although
the land in question is still owned by the parties in co-ownership,
hence, the applicable provision is Art. 486 of the Civil Code, which
was not applied)?
RULING #1: It should be noted that prior to partition, all the co-
owners hold the property in common dominion but at the same
time each is an owner of a share which is abstract and
undetermined until partition is effected.
“An undivided estate is co-ownership by the heirs."
As co-owners, the parties may have unequal shares in the
common property, quantitatively speaking. But in a qualitative
sense, each co-owner has the same right as any one of the other
co-owners. Every co-owner is therefore the owner of the whole,
and over the whole he exercises the right of dominion, but he is at
the same time the owner of a portion which is truly abstract,
because until division is effected such portion is not concretely
determined.
When the co-ownership is terminated by a partition and it appears
that the house of an erstwhile co-owner has encroached upon a
portion pertaining to another co-owner which was however made
in good faith, then the provisions of Article 448 should apply to
determine the respective rights of the parties.
ISSUE #2: That, granting for the sake of argument that Art. 448 is
applicable, did the respondent Court err when it adjudged the
working solution suggested in Grana and Torralba vs. CA. (109
Phil. 260), which is just an opinion by way of passing, and not the
judgment rendered therein, which is in accordance with the said
provision of the Civil Code?
RULING #2: Such ruling contravened the explicit provisions of
Article 448 to the effect that "(t)he owner of the land . . . shall have
the right to appropriate . . .or to oblige the one who built . . . to pay
the price of the land . . . ." The law is clear and unambiguous when
it confers the right of choice upon the landowner and not upon the
builder and the courts.
Thus, in Quemuel vs. Olaes, the Court categorically ruled that the
right to appropriate the works or improvements or to oblige the
builder to pay the price of the land belongs to the landowner.
_____________________________________________________
FILIPINAS COLLEGES, INC., vs. MARIA GARCIA TIMBANG,
ET AL.
G.R. No. L-12812
September 29, 1959
Barrera, J.:
ISSUE: WON the failure of the builder in good faith to pay the
price of the land after the owners thereof exercised their option
under Article 448 of the Civil Code shall excuse the owners, as
highest bidders to pay the auction price and by operation of Article
445, the owners of the land automatically became the owners ipso
facto.
HELD: NO. Article 448 and 546 of the Civil Code defines the right
of the parties in case a person in good faith builds, sows or plants
on the land of another. Under the terms of this first article, it is true
that the owner of the land has the right to choose between
appropriating the building by reimbursing the builder of the value
thereof or compelling the builder in good faith to pay for his land.
Even this second right cannot be exercised if the value of the land
is considerably more than that of the building. In addition to the
right of the builder to be paid the value of his improvement, Article
546 gives him the corollary right of retention of the property until
he is indemnified by the owner of the land. There is nothing in the
language of these two articles which would justify the conclusion
of appellants that, upon the failure of the builder to pay the value
of the land, when such is demanded by the land-owner, the latter
becomes automatically the owner of the improvement under
Article 445. The case of Bernardo vs. Bataclan, 66 Phil., 590 cited
by appellants is no authority for this conclusion. Although it is true
it was declared therein that in the event of the failure of the builder
to pay the land after the owner thereof has chosen this alternative,
the builder's right of retention provided in Article 546 is lost,
nevertheless there was nothing said that as a consequence
thereof, the builder loses entirely all rights over his own building.
The appellants herein, owners o the land, instead of electing any
of the alternative above indicated chose to seek recovery of the
value of their land by asking for a writ of execution; levying on the
house of the builder; and selling the same in public auction and
because they are the highest bidder in their own auction sale, they
now claim they acquired title to the building without necessity of
paying in cash on account of their bid. In other words, they in
effect pretend to retain their land and acquire the house without
paying a cent therefor. However, while it is the inveriable practice,
that where the successful bidder is the execution creditor himself,
he need not pay down the amount of the bid if it does not exceed
the amount of his judgement, nevertheless, when their is a claim
by a third-party, to the proceeds of the sale superior to his
judgment credit, the execution creditor, as successful bidder, must
pay in cash the amount of his bid as a condition precedent to the
issuance to him of the certificate of sale. In the instant case, the
Court of Appeals has already adjudged that appellee Blas is
entitled to the payment of the unpaid balance of the purchase
price of the school building. Blas has actually a lien on the school
building are concerned. The order of the lower court directing the
Timbang spouses, as successful bidders, to pay in cash the
amount of their bid in the sum of P5,750.00 is therefore correct.
With respect to the order of the court declaring appellee Filipinas
Colleges, Inc. part owner of the land to the extent of the value of
its personal properties sold at public auction in favor of the
Timbang, this Court Likewise finds the same as justified, for such
amount represents, in effect, a partial payment of the value of the
land.
_____________________________________________________
Manotok Realty Inc. vs. Tecson
GR L-47475
August 19, 1988
GUTIERREZ, JR., J.
ISSUE: Did respondent judge commit grave abuse of discretion in
denying the motion to exercise option belonging to the owner of
the property under Articles 448 and 546 of the Civil Code?
HELD: Yes. The petitioner argues that since the judgment of the
trial court has already become final, it is entitled to the execution
of the same and that moreover, since the house of the private
respondent was gutted by fire, the execution of the decision would
now involve the delivery of possession of the disputed area by the
private respondent to the petitioner. We find merit in these
arguments. When the decision of the trial court became final and
executory, it became incumbent upon the respondent judge to
issue the necessary writ for the execution of the same. There is,
therefore, no basis for the respondent judge to deny the
petitioner's motion to avail of its option to appropriate the
improvements made on its property. Neither can the respondent
judge deny the issuance of a writ of execution because the private
respondent was adjudged a builder in good faith or on the ground
of "peculiar circumstances which supervened after the institution
of this case, like, for instance, the introduction of certain major
repairs of and other substantial improvements..." because the
option given by law either to retain the premises and pay for the
improvements thereon or to sell the said premises to the builder in
good faith belongs to the owner of the property.
Since the improvements have been gutted by fire, and therefore,
the basis for private respondent's right to retain the premises has
already been extinguished without the fault of the petitioner, there
is no other recourse for the private respondent but to vacate the
premises and deliver the same to herein petitioner.
_____________________________________________________
BERNARDO VS. BATACLAN
G.R. No. L-44606
November 28, 1938
Laurel, J:
Issue: Whether or not defendant is a possessor in good faith and
has the right to retain the land in accordance with Article 453 of
the Civil Code.
Held: The Civil Code confirms certain time-honored principles of
the law of property. One of these is the principle of accession
whereby the owner of property acquires not only that which it
produces but that which is united to it either naturally or artificially.
Whatever is built, planted or sown on the land of another, and the
improvements or repairs made thereon, belong to the owner of the
land. Where, however, the planter, builder, or sower has acted in
good faith, a conflict of rights arises between the owners and it
becomes necessary to protect the owner of the improvements
without causing injustice to the owner of the land. In view of the
impracticability of creating what Manresa calls a state of "forced
coownership," the law has provided a just and equitable solution
by giving the owner of the land the option to acquire the
improvements after payment of the proper indemnity or to oblige
the builder or planter to pay for the land and the sower to pay the
proper rent. It is the owner of the land who is allowed to exercise
the option because his right is older and because, by the principle
of accession, he is entitled to the ownership of the accessory
thing.
In the case before us, the plaintiff, as owner of the land, chose to
require the defendant, as owner of the improvements, to pay for
the land. The defendant states that he is a possessor in good faith
and that the amount of P2,212 to which he is entitled has not yet
been paid to him. Therefore, he says, he has a right to retain the
land in accordance with the provisions of article 453 of the Civil
Code. We do not doubt the validity of the premises stated. We
find, however, that the defendant has lost his right of retention. In
obedience to the decision of this court in G.R. No. 37319, the
plaintiff expressed his desire to require the defendant to pay for
the value of the land. The said defendant could have become
owner of both land and improvements and continued in
possession thereof. But he said he could not pay and the land was
sold at public auction to Toribio Teodoro. The law, as we have
already said, requires no more than that the owner of the land
should choose between indemnifying the owner of the
improvements or requiring the latter to pay for the land. When he
failed to pay for the land, the defendant herein lost his right of
retention.
The sale at public auction having been asked by the plaintiff
himself and the purchase price of P8,000 received by him from
Toribio Teodoro, we find no reason to justify a rapture of the
situation thus created between them, the defendant-appellant not
being entitled, after all, to recover from the plaintiff the sum of
P2,212. The judgment of the lower court is accordingly modified
by eliminating therefrom the reservation made in favor of the
defendant-appellant to recover from the plaintiff the sum of
P2,212. In all the respects, the same is affirmed.
_____________________________________________________
HEIRS OF RAMON DURANO v. UY
G.R. No. 136456
October 24, 2000
GONZAGA-REYES, J.
ISSUES
(1) Whether or not the heirs of Durano were builders in bad faith
(2) Whether or not the Spouses Durano should return the
properties and pay indemnity in reparation of the destroyed
properties overran by the bulldozers
HELD:
(1) YES. A purchaser of a parcel of land cannot close his eyes to
facts which should put a reasonable man upon his guard, such as
when the property subject of the purchase is in possession of
persons other than the seller. A buyer who could not have failed to
know or discover the land sold to him was in adverse possession
of another is a buyer in bad faith.
In the same manner the purchase of the property of Durano III
from Durano Co. could not have been in good faith because it is
not disputed that Durano III had acquired the property with full
knowledge of Spouses Uy’s occupancy thereon.
Furthermore, there even appears to be undue haste in the
conveyance of the property to Durano III, as bulldozing operations
by Durano and Co. were still underway when the deed of sale to
Durano III was executed on September 15, 1970. There was not
even an indication that Durano Co. attempted to transfer the
registration in its name before it conveyed to Durano III.
(2) YES. Since petitioners knew fully well the defect in their titles,
they were correctly held by the Court of Appeals to be builders in
bad faith. And since they were in bad faith, the Civil Code
provides:
Art. 449. He who builds, plants or sows in bad faith on the land of
another, loses what is built, planted or sown without right of
indemnity.
Art. 450. The owner of the land on which anything has been built,
planted or sown in bad faith may demand the demolition of the
work, or that the planting or sowing be removed, in order to
replace things in their former condition at the expense of the
person who built, planted or sowed; or he may compel the builder
or planter to pay the price of the land, and the sower the proper
rent.
Art. 451. In the cases of the two preceding articles, the landowner
is entitled to damages from the builder, planter or sower.
Based on these provisions, the owner of the land has three
alternative rights:
(1) to appropriate what has been built without any obligation to pay
indemnity therefor, or
(2) to demand that the builder remove what he had built, or
(3) to compel the builder to pay the value of the land, or pay the
rent in case of the sower.
In any case, the landowner is entitled to damages under Article
451, above cited. The right of the owner of the land to recover
damages from a builder in bad faith is clearly provided for in
Article 451 of the Civil Code. Although said Article 451 does not
elaborate on the basis for damages, the Court perceives that it
should reasonably correspond with the value of the properties lost
or destroyed as a result of the occupation in bad faith, as well as
the fruits (natural, industrial or civil) from those properties that the
owner of the land reasonably expected to obtain.
_____________________________________________________
BALLATAN vs. COURT OF APPEALS
G.R. No. 125683
March 2, 1999
Puno, J.
ISSUE: WON private respondents Go and Li Ching Yao can be
compelled to demolish and remove all the improvements they
made on the land of Petitioner whose land area was decreased
and deliver the same to the latter. (accion publiciana)
HELD: No. All the parties in the case are possessors in good faith
and as such Article 448 of the Civil Code shall apply. It provides
that the owner of the land on which anything has been built, sown
or planted in good faith shall have the right to appropriate as his
own the building, planting or sowing, after payment to the builder,
planter or sower of the necessary and useful expenses, and in the
proper case, expenses for pure luxury or mere pleasure. The
owner of the land may also oblige the builder, planter or sower to
purchase and pay the price of the land. If the owner chooses to
sell his land, the builder, planter or sower must purchase the land,
otherwise the owner may remove the improvements thereon. The
builder, planter or sower, however, is not obliged to purchase the
land if its value is considerably more than the building, planting or
sowing. In such case, the builder, planter or sower must pay rent
to the owner of the land. If the parties cannot come to terms over
the conditions of the lease, the court must fix the terms thereof.
The right to choose between appropriating the improvement or
selling the land on which the improvement stands to the builder,
planter or sower, is given to the owner of the land.”
Petitioners, as owners of Lot No. 24, may choose to purchase the
improvement made by respondents Go on their land, or sell to
respondents Go the subject portion. If buying the improvement is
impractical as it may render the Go's house useless, then
petitioners may sell to respondents Go that portion of Lot No. 24
on which their improvement stands. If the Go's are unwilling or
unable to buy the lot, then they must vacate the land and, until
they vacate, they must pay rent to petitioners. Petitioners,
however, cannot compel respondents Go to buy the land if its
value is considerably more than the portion of their house
constructed thereon. If the value of the land is much more than
the Go's improvement, then respondents Go must pay reasonable
rent. If they do not agree on the terms of the lease, then they may
go to court to fix the same.
In the event that petitioners elect to sell to respondents Go the
subject portion of their lot, the price must be fixed at the prevailing
market value at the time of payment. The Court of Appeals erred
in fixing the price at the time of taking, which is the time the
improvements were built on the land. The time of taking is
determinative of just compensation in expropriation proceedings.
The instant case is not for expropriation. It is not a taking by the
state of private property for a public purpose upon payment of just
compensation. This is a case of an owner who has been paying
real estate taxes on his land but has been deprived of the use of a
portion of this land for years. It is but fair and just to fix
compensation at the time of payment.
_____________________________________________________
SPOUSES DEL OCAMPO v. ABESIA
G.R. No. L-49219
April 15, 1988
Melencio-Herrera, J.
Issue: Whether or not Art. 448 of the Civil Code is applicable,
upon termination of co-ownership, to a previous co-owner who
built in good faith during the co-ownership on the land previously
owned in common.
Held: Yes. The SC stated that the court a quo correctly held that
Article 448 of the Civil Code cannot apply where a co-owner
builds, plants or sows on the land owned in common for then he
did not build, plant or sow upon land that exclusively belongs to
another but of which he is a co-owner. The co-owner is not a third
person under the circumstances, and the situation is governed by
the rules of co-ownership.
However, when, as in this case, the co-ownership is terminated by
the partition and it appears that the house of defendants overlaps
or occupies a portion of 5 square meters of the land pertaining to
plaintiffs, which the defendants obviously built in good faith, then
the provisions of Article 448 of the new Civil Code should apply.
Manresa and Navarro Amandi agree that the said provision of the
Civil Code may apply even when there was co-ownership if good
faith has been established.
_____________________________________________________
PACIFIC FARMS, INC. v. SIMPLICIO G. ESGUERRA, ET AL.
CARRIED LUMBER COMPANY
G.R. No. L-21783
November 29, 1969
CASTRO, J.
Issue: Whether there exists a materialman's lien over the six
buildings in favor of the appellant.
Held: Article 447 of the Civil Code1 provides:
The owner of the land who makes thereon personally or through
another, plantings, constructions or works with the materials of
another, shall pay their value; and, if he acted in bad faith, he shall
also be obliged to the reparation of damages. The owner of the
materials shall have the right to remove them only in case he can
do so without injury to the work constructed, or without the
plantings, constructions or works being destroyed. However, if the
landowner acted in bad faith, the owner of the materials may
remove them in any event with a right to be indemnified for
damages.
The abovequoted legal provision contemplates a principal and an
accessory, the land being considered the principal, and the
plantings, constructions or works, the accessory. The owner of the
land who in good faith — whether personally or through another —
makes constructions or works thereon, using materials belonging
to somebody else, becomes the owner of the said materials with
the obligation however of praying for their value.2 The owner of
the materials, on the other hand, is entitled to remove them,
provided no substantial injury is caused to the landowner.
Otherwise, he has the right to reimbursement for the value of his
materials.
Although it does not appear from the records of this case that the
land upon which the six buildings were built is owned by the
appellee, nevertheless, that the appellee claims that it owns the
six buildings constructed out of the lumber and construction
materials furnished by the appellant, is indubitable. Therefore,
applying article 447 by analogy, we perforce consider the buildings
as the principal and the lumber and construction materials that
went into their construction as the accessory. Thus the appellee, if
it does own the six buildings, must bear the obligation to pay for
the value of the said materials; the appellant — which apparently
has no desire to remove the materials, and, even if it were minded
to do so, cannot remove them without necessarily damaging the
buildings — has the corresponding right to recover the value of the
unpaid lumber and construction materials.
Well-established in jurisprudence is the rule that compensation
should be borne by the person who has been benefited by the
accession.3 No doubt, the appellee benefited from the accession,
i.e., from the lumber and materials that went into the construction
of the six buildings. It should therefore shoulder the compensation
due to the appellant as unpaid furnisher of materials.
PECSON v. COURT OF APPEALS
G.R. No. 115814
May 26, 1995
Davide, Jr., J.
Issue: The parties agree that the petitioner was a builder in good
faith of the apartment building on the theory that he constructed it
at the time when he was still the owner of the lot, and that the key
issue in this case is the application of Articles 448 and 456 of the
Civil Code.
Held: By its clear language, Article 448 refers to a land whose
ownership is claimed by two or more parties, one of whom has
built some works, or sown or planted something. The building,
sowing or planting may have been made in good faith or in bad
faith. The rule on good faith laid down in Article 526 of the Civil
Code shall be applied in determining whether a builder, sower or
planter had acted in good faith.
Article 448 does not apply to a case where the owner of the land is
the builder, sower, or planter who then later loses ownership of the
land by sale or donation. Elsewise stated, where the true owner
himself is the builder of works on his own land, the issue of good
faith or bad faith is entirely irrelevant. Thus in strict point of law,
Article 448 is not apposite to the case at bar. Nevertheless, we
believe that the provision therein on indemnity may be applied by
analogy considering that the primary intent of Article 448 is to
avoid a state of forced co-ownership and that the parties, including
the two courts below, in the main agree that Articles 448 and 546
of the Civil Code are applicable and indemnity for the
improvements may be paid although they differ as to the basis of
the indemnity.
_____________________________________________________
TECHNOGAS PHILIPPINES, INC. V. CA
G.R. No. 108894, 268 SCRA 5
February 10, 1997
Panganiban, J.
ISSUE: Whether Petitioner became a builder in bad faith on the
presumption that it should know the metes and bounds of its
property.
HELD: No. When petitioner purchased the land from Pariz
Industries, the buildings and other structures were already in
existence. The record does not show that petitioner was aware of
the encroachment when it came into possession of the property.
Likewise unclear is the identity of the actual builder, but it may well
be assumed that it was petitioner’s predecessor-in-interest, Pariz
Industries.
In view of the good faith of both petitioner and private respondent,
their respective rights and obligations are to be governed by
Article 448 of the Civil Code. In Depra vs. Dumlao, where the
builder, planter or sower has acted in good faith, a conflict of rights
arises between the owners, and it becomes necessary to protect
the owner of the improvements without causing injustice to the
owner of the land. In view of the impracticality of creating a state
of forced co-ownership, the law has provided a just solution by
giving the owner of the land the option to acquire the
improvements after payment of the proper indemnity, or to oblige
the builder or planter to pay for the land and the sower to pay the
proper rent. It is the owner of the land who is authorized to
exercise the option, because his right is older, and because, by
the principle of accession, he is entitled to the ownership of the
accessory thing.
Forcible removal of the encroaching structures would only be
available should private respondent choose to compel the
petitioner to buy the land at a reasonable price but the latter fails
to pay such price. This has not taken place, constraining private
respondent to: (1) appropriate the encroaching portion of
petitioner’s building after payment of proper indemnity, or (2)
obliging the latter to buy the lot occupied by the structure. Private
respondent cannot exercise a remedy of his own liking.
_____________________________________________________
PLEASANTVILLE DEVL CORP. v. COURT OF APPEALS
G.R. No. 79688
Feb. 1, 1996
Panganiban, J.
ISSUE: Whether or not a lot buyer who constructs improvements
on the wrong property erroneously delivered by the owner’s agent
is a builder in good faith.
HELD: Yes. Good faith under Article 448 consists in the belief of
the builder that the land he is building on is his and his ignorance
of any defect or flaw in his title. And as good faith is presumed,
petitioner has the burden of proving bad faith on the part of Kee.
In the case at bar, Kee had acted in the manner of a prudent man
in ascertaining the identity of his property. He went to the
subdivision developer’s agent and applied and paid for the
relocation of the lot, as well as for the production of a lot plan by
CTTEI’s geodetic engineer. Upon Kee’s receipt of the map, his
wife went to the subdivision site accompanied by CTTEI’s
employee, Octaviano, who authoritatively declared that the land
she was pointing to was indeed Lot 8. Kee saw no reason to
suspect that there had been a misdelivery. The steps Kee had
taken to protect his interests were reasonable.
Kee believed that Lot 8 was what he bought from petitioner at the
time he built improvements on it. He was not aware that the lot
delivered to him was not Lot 8 but Lot 9. Thus, Kee’s good faith.
Petitioner failed to prove otherwise.
_____________________________________________________
GEMINIANO v COURT OF APPEALS
G.R. No. 120303
July 24, 1996
DAVIDE, Jr., J.
ISSUE: Whether the private respondents are builders in good faith
or mere lessees?
HELD: No. Being mere lessees, the private respondents knew that
their occupation of the premises would continue only for the life of
the lease. Plainly, they cannot be considered as possessors nor
builders in good faith. In a plethora of cases, this Court has held
that Article 448 of the Civil Code, in relation to Article 546 of the
same Code, which allows full reimbursement of useful
improvements and retention of the premises until reimbursement
is made, applies only to a possessor in good faith, i.e., one who
builds on land with the belief that he is the owner thereof. It does
not apply where one's only interest is that of a lessee under a
rental contract; otherwise, it would always be in the power of the
tenant to "improve" his landlord out of his property.
_____________________________________________________
EULOGIO AGUSTIN vs. INTERMEDIATE APPELLATE COURT
G.R. Nos. L-66075-76
July 5, 1990
GRIÑO-AQUINO, J.
ISSUES:
a) Whether or not the Court of Appeals erred in declaring that the
land in question had become part of private respondents' estate as
a result of accretion.
b) Whether or not the Court of Appeals erred in declaring that the
ownership of private respondents over the accretion is not affected
by the sudden and abrupt change in the course of the Cagayan
River when it reverted to its old bed.
Held: The petition is unmeritorious and must be denied.
a) The finding of the Court of Appeals that there had been
accretions to the lots of the private respondents who did not lose
the ownership of such accretions even after they were separated
from the principal lots by the sudden change of course of the river,
is a finding of fact which is conclusive on this Court. That finding is
supported by Art. 457 of the New Civil Code which provides: Art.
457. To the owners of lands adjoining the banks of rivers belong
the accretion which they gradually receive from the effects of the
current of the waters.

Accretion benefits a riparian owner when the following requisites
are present: (1) that the deposit be gradual and imperceptible; (2)
that it resulted from the effects of the current of the water; and (3)
that the land where accretion takes place is adjacent to the bank
of a river (Republic vs. CA, 132 SCRA 514).
b) The private respondents' ownership of the accretion to their
lands was not lost upon the sudden and abrupt change of the
course of the Cagayan River in 1968 or 1969 when it reverted to
its old 1919 bed, and separated or transferred said accretions to
the other side (or eastern bank) of the river. Articles 459 and 463
of the New Civil Code apply to this situation.
Art. 459. Whenever the current of a river, creek or torrent
segregates from an estate on its bank a known portion of land and
transfers it to another estate, the owner of the land to which the
segregated portion belonged retains the ownership of it, provided
that he removes the same within two years.
Art. 463. Whenever the current of a river divides itself into
branches, leaving a piece of land or part thereof isolated, the
owner of the land retains his ownership. He also retains it if a
portion of land is separated from the estate by the current.
In the case at bar, the sudden change of course of the Cagayan
River as a result of a strong typhoon in 1968 caused a portion of
the lands of the private respondents to be "separated from the
estate by the current." The private respondents have retained the
ownership of the portion that was transferred by avulsion to the
other side of the river.
_____________________________________________________
CUREG V. INTERMEDIATE APPELLATE COURT
G.R. No. 73465
September 7, 1989
MEDIALDEA, J.
ISSUE: Whether or not an accretion automatically belongs to the
adjacent land owner who has an Original Certificate of Title and
consider such accretion deemed registered.
HELD: No. The "subject land" is an alluvial deposit left by the
northward movement of the Cagayan River and pursuant to Article
457 of the New Civil Code:
To the owners of land adjoining the banks of river belong the
accretion which they gradually receive from the effects of the
current of the waters.
The increase in the area of petitioners' land, being an accretion left
by the change of course or the northward movement of the
Cagayan River does not automatically become registered land just
because the lot which receives such accretion is covered by a
Torrens title. (See Grande v. Court of Appeals, L-17652, June 30,
1962). As such, it must also be placed under the operation of the
Torrens System.
_____________________________________________________
Viajar v. CA
G.R.No. 77294
December 12, 1988
Medialdea, J.:
Issue: Whether the change in the course of the Suague River was
sudden as claimed by the plaintiffs or gradual as contended by the
defendants. Assuming arguendo it was gradual, whether or not the
plaintiffs are still entitled to Lot ‘B' appearing in Exhibit "4" and to
one-half (½) of Lot "A," also indicated in Exhibit "4"
Held: The presumption is that the change in the course of the river
was gradual and caused by accretion and erosion. The
defendants have sufficiently established that for many years the
Suague River overflowed its banks yearly and the property of the
defendant gradually received deposits of soil from the effects of
the current of the river. The consequent increase in the area of Lot
No. 7511 due to alluvion or accretion was possessed by the
defendants whose tenants plowed and planted the same with coin
and tobacco.
The quondam river bed had been filled by accretion through the
years. The land is already plain and there is no indication on the
ground of any abandoned river bed. The river bed is definitely no
longer discernible now.
What used to be the old river bed (Lot A) is in level with Lot No.
7511. So are the two other areas to the East. (Lots B and C) Lots
A, B and C are still being cultivated.
Under the law, accretion which the banks or rivers may gradually
receive from the effects of the current of the waters becomes the
property of the owners of the lands adjoining the banks. (Art. 366,
Old Civil Code; Art. 457, New Civil Code which took effect on
August 30, 1950 [Lara v. Del Rosario, 94 Phil. 778]. Therefore, the
accretion to Lot No. 7511 which consists of Lots A and B (see
Exhs. 'C' and '4') belongs to the defendants.
_____________________________________________________
VDA. DE NAZARENO v. COURT OF APPEALS
G.R. No. 98045
June 26, 1996
ROMERO, J.
Issue: Whether or not the subject land is private land being an
accretion to petitioner’s titled property
Held: No. In the case of Meneses v. CA, this Court held that
accretion, as a mode of acquiring property under Art. 457 of the
Civil Code, requires the concurrence of these requisites : (1) that
the deposition of soil or sediment be gradual and imperceptible;
(2) that it be the result of the action of the waters of the river (or
sea); and (3) that the land where accretion takes place is adjacent
to the banks of rivers (or the sea coast). These are called the rules
on alluvion which if present in a case, give to the owners of lands
adjoining the banks of rivers or streams any accretion gradually
received from the effects of the current of waters.
For petitioners to insist on the application of these rules on
alluvion to their case, the above-mentioned requisites must be
present. However, they admit that the accretion was formed by the
dumping of boulders, soil and other filling materials on portions of
the Balacanas Creek and the Cagayan River bounding their land.
It cannot be claimed, therefore, that the accumulation of such
boulders, soil and other filling materials was gradual and
imperceptible, resulting from the action of the waters or the current
of the Balacanas Creek and the Cagayan River. In Hilario v. City
of Manila, this Court held that the word "current" indicates the
participation of the body of water in the ebb and flow of waters due
to high and low tide. Petitioners' submission not having met the
first and second requirements of the rules on alluvion, they cannot
claim the rights of a riparian owner.
It is this Court's irresistible conclusion, therefore, that the accretion
was man-made or artificial. In Republic v. CA, this Court ruled that
the requirement that the deposit should be due to the effect of the
current of the river is indispensable. This excludes from Art. 457 of
the Civil Code all deposits caused by human intervention. Putting
it differently, alluvion must be the exclusive work of nature. Thus,
in Tiongco v. Director of Lands, et al., where the land was not
formed solely by the natural effect of the water current of the river
bordering said land but is also the consequence of the direct and
deliberate intervention of man, it was deemed a man-made
accretion and, as such, part of the public domain.
In the case at bar, the subject land was the direct result of the
dumping of sawdust by the Sun Valley Lumber Co. consequent to
its sawmill 
 operations. Even if this Court were to take into
consideration petitioners' submission that the accretion site was
the result of the late Antonio Nazareno's labor consisting in the
dumping of boulders, soil and other filling materials into the
Balacanas Creek and Cagayan River bounding his land, the same
would still be part of the public domain.
_____________________________________________________
HEIRS OF NAVARRO v. IAC
G.R. No. 68166
February 12, 1997
Hermosisima, Jr., J.
ISSUE: Can the petitioners rightfully claim ownership over the land
through the principle of accretion?
HELD: The disputed property was brought forth by both the
withdrawal of the waters of Manila Bay and the accretion formed
on the exposed foreshore land by the action of the sea which
brought soil and sand sediments in turn trapped by the palapat
and bakawan trees planted thereon by petitioner Sulpicio Pascual
in 1948.
Accretion as a mode of acquiring property under said Article 457,
requires the concurrence of the following requisites:
(1) that the accumulation of soil or sediment be gradual and
imperceptible;
(2) that it be the result of the action of the waters of the river; and
(3) that the land where the accretion takes place is adjacent to the
bank of the river.
Accretion is the process whereby the soil is deposited, while
alluvium is the soil deposited on the estate fronting the river bank;
the owner of such estate is called the riparian owner. Riparian
owners are, strictly speaking, distinct from littoral owners, the latter
being owners of lands bordering the shore of the sea or lake or
other tidal waters. The alluvium, by mandate of Article 457 of the
Civil Code, is automatically owned by the riparian owner from the
moment the soil deposit can be seen but is not automatically
registered property, hence, subject to acquisition through
prescription by third persons.
The disputed land is an accretion not on a river bank but on a sea
bank, or on what used to be the foreshore of Manila Bay which
adjoined private respondents' own tract of land on the northern
side. As such, the applicable law is not Article 457 of the Civil
Code but Article 4 of the Spanish Law of Waters of 1866.
Article 4 of the Spanish Law of Waters of August 3, 1866 provides
as follows:
"Lands added to the shores by accretions and alluvial deposits
caused by the action of the sea, form part of the public domain.
When they are no longer washed by the waters of the sea and are
not necessary for purposes of public utility, or for the
establishment of special industries, or for the coast-guard service,
the Government shall declare them to be the property of the
owners of the estates adjacent thereto and as increment thereof."
As part of the public domain, the herein disputed land is intended
for public use, and "so long as the land in litigation belongs to the
national domain and is reserved for public use, it is not capable of
being appropriated by any private person, except through express
authorization granted in due form by a competent authority." Only
the executive and possibly the legislative departments have the
right and the power to make the declaration that the lands so
gained by action of the sea is no longer necessary for purposes of
public utility or for the cause of establishment of special industries
or for coast guard services.
CO-OWNERSHIP
DEL BANCO v. INTERMEDIATE APPELLATE COURT
G.R. No. 72694
December 1, 1987
PARAS, J.
Issue: Can mere agreement to subdivide property terminate co-
ownership?
Held: No. It is not enough that the co-owners agree to subdivide
the property. They must have a subdivision plan drawn in
accordance with which they take actual and exclusive possession
of their respective portions in the plan and titles issued to each of
them accordingly (Caro vs. Court of Appeals, 113 SCRA 10
[1982]). The mechanics of actual partition should follow the
procedure laid down in Rule 69 of the Rules of Court. Maganon
vs. Montejo, 146 SCRA 282 [1986]).
Neither can such actual possession and enjoyment of some
portions of the Island by some of the petitioners herein be
considered a repudiation of the co-ownership. It is undisputed that
the Cagbalite Island was purchased by the original co-owners as a
common property and it has not been proven that the Island had
been partitioned among them or among their heirs. While there is
co-ownership, a co-owner's possession of his share is co-
possession which is linked to the possession of the other co-
owners (Gatchalian vs. Arlegui, 75 SCRA 234 [1977]).
Furthermore, no prescription shall run in favor of a co-owner
against his co-owners or co-heirs so long as he expressly or
impliedly recognizes the co-ownership (Valdez vs. Olonga, 51
SCRA 71 [1973], Tero vs. Tero, 131 SCRA 100 [1984]). Co-
owners cannot acquire by prescription the share of the other co-
owners, absent a clear repudiation of the co-ownership clearly
communicated to the other co-owners (Mariano vs. De Vega, 148
SCRA 342 [1987]).
An action for partition does not prescribe. Article 403 of the Old
Civil Code, now Article 497, provides that the assignees of the co-
owners may take part in the partition of the common property, and
Article 400 of the Old Code, now Article 494 provides that each
co-owner may demand at any time the partition of the common
property, a provision which implies that the action to demand
partition is imprescriptible or cannot be barred by laches (Budlong
vs. Pondoc, 79 SCRA 24 [1977]). An action for partition does not
lie except when the co-ownership is properly repudiated by the co-
owner (Jardin vs. Hollasco, 117 SCRA 532 [1982]).
_____________________________________________________
Vicenta Ortiz Pardell and Ricardo Pardell VS. Matilde Ortiz
Bartolome and Gaspar Bartolome
G.R. No. L-4656
18 November 18, 1912
Torres, J:
ISSUE: Whether or not the respondent spouses should pay rent to
the petitioner, the respondent wife’s sister and co-owner of the
property in question, for the use of the: a) 2nd floor for dwelling
and b) 1st floor for the husband’s office.
HELD: Respondents should pay rent for the use of the 1st floor
but not for the use of the 2nd floor.
Article 394 of the Civil Code prescribes:
Each co-owner may use the things owned in common, provided
he uses them in accordance with their object and in such manner
as not to injure the interests of the community nor prevent the co-
owners from utilizing them according to their rights.
Respondents occupied the upper story, designed for use as a
dwelling, in the house of joint ownership; but the record shows no
proof that there was any detriment to the interest of the community
property, nor that she prevented the petitioner from utilizing the
said upper story according to her rights.
The respondent husband occupied for four years the lower floor of
the same house as an office for the justice of the peace, a position
which he held in the capital of that province, strict justice, requires
that he pay his sister-in-law, the plaintiff, one half of the monthly
rent which the said quarters could have produced, had they been
leased to another person. This conclusion as to Bartolome's
liability results from the fact that, even as the husband of the
defendant co-owner of the property, he had no right to occupy and
use gratuitously the said part of the lower floor of the house in
question, where he lived with his wife, to the detriment of the
plaintiff Vicenta who did not receive one-half of the rent which
those quarters could and should have produced, had they been
occupied by a stranger, in the same manner that rent was
obtained from the rooms on the lower floor that were used as
stores.
_____________________________________________________
CARO VS. COURT OF APPEALS
G.R. No. L-46001
March 25, 1982
Guerrero, J.
ISSUES:
1. Is an oral agreement of partition valid?
2. Is the right of legal redemption still available when the co-
ownership is already terminated?
HELD:
1. YES. An agreement of partition, though oral, is valid and
consequently binding upon the parties.
2. NO. Inasmuch as the purpose of the law in establishing the right
of legal redemption between co-owners is to reduce the number of
participants until the community is done away with, once the
property is subdivided and distributed among the co-owners, the
community has terminated and there is no reason to sustain any
right of legal redemption. The Court further held that the effect is
no different with respect to a conveyance which took place before
the partition agreement and approval by the court.
_____________________________________________________
Bailon-Casilao v. CA
G.R. No. 78178
April 15, 1988
Cortes, J.:
Issues:
1. What is the effect of a sale by one or more co-owners of the
entire property held in common without the consent of all the co-
owners?
2. What is the appropriate remedy of the aggrieved co-owners in
case of such sale by a co-owner?
Held:
1. The pertinent civil code provision is Art. 493. The Court ruled
that even if a co-owner sells the whole property as his, the sale
will affect only his own share but not those of the other co-owners
who did not consent to the sale. This is because under the
aforementioned codal provision, the sale or other disposition
affects only his undivided share and the transferee gets only what
would correspond to his grantor in the partition of the thing owned
in common.
From the foregoing, it may be deduced that since a co-owner is
entitled to sell his undivided share, a sale of the entire property by
one co-owner without the consent of the other co-owners is not
null and void. However, only the rights of the co-owner-seller are
transferred, thereby making the buyer a co-owner of the property.
2. The proper action in cases like this is not for the nullification of
the sale or for the recovery of possession of the thing owned in
common from the third person who substituted the co-owner or co-
owners who alienated their shares, but the DIVISION of the
common property as if it continued to remain in the possession of
the co-owners who possessed and administered it.
Thus, it is now settled that the appropriate recourse of co-owners
in cases where their consent were not secured in a sale of the
entire property as well as in a sale merely of the undivided shares
of some of the co-owners is an action for PARTITION under Rule
69 of the Revised Rules of Court. Neither recovery of possession
nor restitution can be granted since the defendant buyers are
legitimate proprietors and possessors in joint ownership of the
common property claimed.
_____________________________________________________
ROQUE v. INTERMEDIATE APPELLATE COURT
G.R. No. 75886
August 30, 1988
Feliciano, J.
Issue: Whether or not an action for partition will not prosper from
the moment an alleged co-owner asserts an adverse title.
Held: No. An action for partition-which is typically brought by a
person claiming to be co-owner of a specified property against a
defendant or defendants whom the plaintiff recognizes to be co-
owners — may be seen to present simultaneously two principal
issues. First, there is the issue of whether the plaintiff is indeed a
co-owner of the property sought to be partitioned. Second,
assuming that the plaintiff successfully hurdles the first issue,
there is the secondary issue of how the property is to be divided
between plaintiff and defendant(s).
Should the trial court find that the defendants do not dispute the
status of the plaintiff as co-owner, the court can forthwith proceed
to the actual partitioning of the property involved. In case the
defendants assert in their Answer exclusive title in themselves
adversely to the plaintiff, the court should not dismiss the plaintiffs
action for partition but, on the contrary and in the exercise of its
general jurisdiction, resolve the question of whether the plaintiff is
co-owner or not. Should the trial court find that the plaintiff was
unable to sustain his claimed status as co-owner, or that the
defendants are or have become the sole and exclusive owners of
the property involved, the court will necessarily have to dismiss
the action for partition. This result would be reached, not because
the wrong action was commenced by the plaintiff, but rather
because the plaintiff having been unable to show co-ownership
rights in himself, no basis exists for requiring the defendants to
submit to partition the property at stake. If, upon the other hand,
the court after trial should find the existence of co-ownership
among the parties litigant, the court may and should order the
partition of the property in the same action. Judgment for one or
the other party being on the merits, the losing party may then
appeal the same. In either case, however, it is quite unnecessary
to require the plaintiff to file another action, separate and
independent from that for partition originally instituted.
Functionally, an action for partition may be seen to be at once an
action for declaration of coownership and for segregation and
conveyance of a determinate portion of the property involved.
The question of prescription also needs to be addressed in this
connection. It is sometimes said that "the action for partition of the
thing owned in common (actio communi dividendo or actio familiae
erciscundae) does not prescribe." This statement bears some
refinement. In the words of Article 494 of the Civil Code, "each co-
owner may demand at any time the partition of the thing owned in
common, insofar as his share is concemed." No matter how long
the co-ownership has lasted, a co-owner can always opt out of the
co-ownership, and provided the defendant co-owners or co-heirs
have theretofore expressly or impliedly recognized the co-
ownership, they cannot set up as a defense the prescription of the
action for partition. But if the defendants show that they had
previously asserted title in themselves adversely to the plaintiff
and for the requisite period of time, the plaintiffs right to require
recognition of his status as a co-owner will have been lost by
prescription and the court cannot issue an order requiring partition.
_____________________________________________________
DE LIMA V. CA
G.R. No. L-46296
September 24, 1991
Medialdea, J:
Issue: Is petitioner’s action for partition already barred by the
statutory period provided by law which would then enable private
respondent (Galileo De Lima) to perfect his claim of ownership by
acquisitive prescription?
Held: Yes. As a rule possession by a co-owner will not be
presumed adverse to others, but will be held to benefit all. It is
understood that a co-heir or co-owner who is in possession of an
inheritance pro-indiviso for himself and in representation of other
co-owners or co-heirs is regarded as a depository, lessee or
trustee. No prescription shall therefore run in favor of a co-owner
as against his co-owners or co-heirs so long as he expressly or
impliedly recognizes the co-ownership.
However, from the moment one of the co-owners claims that he is
the absolute and exclusive owner of the properties and denies the
share of the others, the question involved is no longer of partition
but of ownership.
Evidence shows that Galileo Delima obtained the issuance of a
new title in his name to the exclusion of his co-heirs. The issuance
of this new title constituted an open and clear repudiation of the
trust or co-ownership, and the lapse of ten years of adverse
possession by Galileo Delima was sufficient to vest title in him by
prescription. Hence, when petitioners filed their action for
reconveyance and/or to compel partition on February 29, 1968,
such action was already barred by prescription.
_____________________________________________________
AGUILAR vs. COURT OF APPEALS
G.R. No. 76351
October 29, 1993
Bellosillo, J.;
Issue: When may a co-ownership be dissolved?
Whether a co-owner of a property can be held liable for payment
of rentals on a property co-owned by him.
Held: Article 494 of the Civil Code provides that no co-owner shall
be obliged to remain in the co-ownership, and that each co-owner
may demand at any time partition of the thing owned in common
insofar as his share is concerned. Corollary to this rule, Art. 498 of
the Code states that whenever the thing is essentially, indivisible
and the co-owners cannot agree that it be, allotted to one of them
who shall indemnify the others, it shall be sold and its proceeds
accordingly distributed. This is resorted to (1) when the right to
partition the property is invoked by any of the co-owners but
because of the nature of the property it cannot be subdivided or its
subdivision would prejudice the interests of the co-owners, and (b)
the co-owners are not in agreement as to who among them shall
be allotted or assigned the entire property upon proper
reimbursement of the co-owners. In one case, this Court upheld
the order of the trial court directing the holding of a public sale of
the properties owned in common pursuant to Art. 498 of the Civil
Code.
However, being a co-owner respondent has the right to use the
house and lot without paying any compensation to petitioner, as
he may use the property owned in common long as it is in
accordance with the purpose for which it is intended and in a
manner not injurious to the interest of the other co-owners. Each
co-owner of property held pro indiviso exercises his rights over the
whole property and may use and enjoy the same with no other
limitation than that he shall not injure the interests of his co-
owners, the reason being that until a division is made, the
respective share of each cannot be determined and every co-
owner exercises, together with his co-participants joint ownership
over the pro indiviso property, in addition to his use and enjoyment
of the same.
_____________________________________________________
CLAUDIO MEMORIAL COLLEGE vs. COURT OF APPEALS
G.R. No. 124262
October 12, 1999
Quisumbing, J.
Issue: Whether or not petitioner is entitled to ownership of the
entire property by virtue of
prescription?
Held: No. On the issue of prescription, we have ruled that even if a
co-owner sells the
whole property as his, the sale will affect only his own share but
not those of the other co-owners who did not consent to the
sale.[8] Under Article 493 of the Civil Code, the sale or other
disposition affects only the seller’s share pro indiviso, and the
transferee gets only what corresponds to his grantor’s share in the
partition of the property owned in common. Since a co-owner is
entitled to sell his undivided share, a sale of the entire property by
one co-owner without the consent of the other co-owners is not
null and void. However, only the rights of the co-owner/seller are
transferred, thereby making the buyer a co-owner of the property.
The proper action in a case like this, is not for the nullification of
the sale, or for the recovery of possession of the property owned
in common from the third person, but for division or partition of the
entire property if it continued to remain in the possession of the
co-owners who possessed and administered it.[9] Such partition
should result in segregating the portion belonging to the seller and
its delivery to the buyer.
In the light of the foregoing, petitioner’s defense of prescription
against an action for
partition is a vain proposition. Pursuant to Article 494 of the Civil
Code, “no co-owner shall be
obliged to remain in the co-ownership. Such co-owner may
demand at anytime the partition of
the thing owned in common, insofar as his share is concerned.” In
Budlong vs. Bondoc,[10] this
Court has interpreted said provision of law to mean that the action
for partition is imprescriptible.
It cannot be barred by prescription. For Article 494 of the Civil
Code explicitly declares: “No
prescription shall lie in favor of a co-owner or co-heirs as long as
he expressly or impliedly
recognizes the co-ownership.”
LUCIO ROBLES vs. COURT OF APPEALS
G.R. No. 123509
March 14, 2000
PANGANIBAN, J.:
Issue: Whether or not a title may prescribe in favor of a co-owner
(Hilario).
Held: There is merit to the contention of the petitioners that Hilario
mortgaged the disputed property to the Rural Bank of Cardona in
his capacity as a mere co-owner thereof. The said transaction did
not divest them of title to the property at the time of the institution
of the Complaint for quieting of title. Maintaining that as co-owners
of the subject property, they did not agree to the real estate
mortgage constituted on it, petitioners insist that their shares
therein should not have been prejudiced by Hilario's actions.
Hilario effected no clear and evident repudiation of the co-
ownership. It is a fundamental principle that a co-owner cannot
acquire by prescription the share of the other co-owners, absent
any clear repudiation of the co-ownership. In order that the title
may prescribe in favor of a co-owner, the following requisites must
concur: (1) the co-owner has performed unequivocal acts of
repudiation amounting to an ouster of the other co-owners; (2)
such positive acts of repudiation have been made known to the
other co-owner; and (3) the evidence thereof is clear and
convincing.
Hilario did not have possession of the subject property; neither did
he exclude the petitioners from the use and the enjoyment thereof,
as they had indisputably shared in its fruits. Likewise, his act of
entering into a mortgage contract with the bank cannot be
construed to be a repudiation of the co-ownership. As absolute
owner of his undivided interest in the land, he had the right to
alienate his share, as he in fact did. Neither should his payment of
land taxes in his name, as agreed upon by the co-owners, be
construed as a repudiation of the co-ownership. The assertion that
the declaration of ownership was tantamount to repudiation was
belied by the continued occupation and possession of the disputed
property by the petitioners as owners.
_____________________________________________________
POSSESSION
RIZAL CEMENT CO. v. VILLAREAL
G.R. No. L-30272
February 28, 1985
Cuevas, J.
Issue: How is possession acquired?
Held: Being an attribute of ownership, appellants' possession of
the land in question goes far to tip the scale in their favor. The
right to possess flows from ownership. No person should suffer
adverse possession by another of what belongs to him. Were the
oppositor - appellee rightful owner of the land in question, it would
not have allowed the tenants to cultivate the land and give the
owner's share to appellants and/or their predecessors. It would
have opposed the survey for applicants' vendors but did not as
shown in the surveyor's certificate. Very significantly petitioner did
not present any witness in actual possession of the land in
question. As aptly found by the appellate court, respondents
possess the property in the concept of an owner.
Possession is acquired by the material occupation of a thing or the
exercise of a right or by the fact it is subject to the action of our
will, or by the proper acts and legal formalities established for
acquiring such right. Petitioner's evidence, consisting of tax
receipts, tax declaration and survey plan are not conclusive and
indisputable basis of one's ownership of the property in question.
Assessment alone is of little value as proof of title. Mere tax
declaration does not vest ownership of the property upon the
declarant. Settled is the rule that neither tax receipts nor
declaration of ownership for taxation purposes alone constitutes
sufficient evidence of ownership or of the right to possess realty.
They must be supported by other effective proofs. Neither can the
survey plan or technical descriptions prepared at the instance of
the party concerned be considered in his favor, the same being
self-serving.
WONG v. CARPIO
G.R. No. L-50264
October 21, 1991
BIDIN, J.
Issue: Are periodic visits to gather coconuts sufficient to prove
prior possession?
Held: Yes. It should be stressed that "possession is acquired by
the material occupation of a thing or the exercise of a right, or by
the fact that it is subject to the action of our will, or by the proper
acts and legal formalities for acquiring such right." (Art. 531, Civil
Code; Rizal Cement Co., Inc. vs. Villareal, 135 SCRA 15 [1985]);
and that the execution of a sale thru a public instrument shall be
equivalent to the delivery of the thing, unless there is stipulation to
the contrary . . . . If, however, notwithstanding the execution of the
instrument, the purchaser cannot have the enjoyment and material
tenancy of the thing and make use of it herself, because such
tenancy and enjoyment are opposed by another, then delivery has
not been effected.
_____________________________________________________
SOMODIO vs. COURT OF APPEALS
G.R. No. 82680
August 15, 1994
Quiason, J.:
Issue: Whether or not the petitioner had prior possession of the
subject property.
Held: Yes. Petitioner took possession of the property in 1974
when he planted various kinds of tress on it. In 1976, he started
the construction of a building on the property. It is immaterial that
the building was unfinished and that he left for Kidapawan and
visited the property intermittently. Possession in the eyes of the
law does not mean that a man has to have his feet on every
square meter of ground before it can be said that he is in
possession (Ramos v. Director of Lands, 39 Phil. 175 [1918]). It is
enough that petitioner was able to subject the property to the
action of his will.
Even if the Court of Appeals is correct in its finding that petitioner
started introducing improvements on the land only in 1981, he still
had priority of possession because respondent Purisima entered
the premises only in 1983.
_____________________________________________________
MAGLUCOT-AW v. MAGLUCOT
G.R. No. 132518
March 28, 2000
KAPUNAN, J.:
Issue: Whether or not the respondents are estopped from
questioning the title to partition.
Held: Yes. Parties to a partition proceeding, who elected to take
under partition, and who took possession of the portion allotted to
them, are estopped from questioning the title to partition allotted to
another party. Here, respondents already occupied the lots in
accordance with the sketch plan. This occupation continued until
this action was filed. They cannot now be heard to question the
possession and ownership of the other co-owners who took
exclusive possession of Lot 1639-D also in accordance with the
sketch plan. The payment of rentals by respondents reveal that
they are mere lessees. As such, the possession of respondents
over Lot No. 1639-D is that of a holder and not in the concept of
an owner. One who possesses as a mere holder acknowledges in
another a superior right which he believes to be ownership,
whether his belief be right or wrong. Since the possession of
respondents were found to be that of lessors of petitioners, it goes
without saying that the latter were in possession of Lot No. 1639-D
in the concept of an owner from 1952 up to the time the present
action was commenced.
_____________________________________________________
CEQUEÑA v. BOLANTE
G.R. No. 137944
April 6, 2000
Panganiban, J.
ISSUE:.Between petitioners and respondent, who is the preferred
possessor/s under Article 538 of the Civil Code?
HELD: Respondent is the preferred possessor under Article 538 of
the Civil Code. The Court conceded that despite their
dispossession in 1985, the petitioners did not lose legal
possession because possession cannot be acquired through force
or violence. To all intents and purposes, a possessor, even if
physically ousted, is still deemed the legal possessor. Indeed,
anyone who can prove prior possession, regardless of its
character, may recover such possession.
However, possession by the petitioners does not prevail over that
of the respondent. Possession by the former before 1985 was not
exclusive, as the latter also acquired it before 1985. The records
show that the petitioners' father and brother, as well as the
respondent and her mother were simultaneously in adverse
possession of the land.
Before 1985, the subject land was occupied and cultivated by the
respondent's father (Sinforoso), who was the brother of petitioners'
father (Margarito), as evidenced by Tax Declaration No. 26425.
When Sinforoso died in 1930, Margarito took possession of the
land and cultivated it with his son Miguel. At the same time,
respondent and her mother continued residing on the lot.
When respondent came of age in 1948, she paid realty taxes for
the years 1932-1948. Margarito declared the lot for taxation in his
name in 1953 and paid its realty taxes beginning 1952. When he
died, Miguel continued cultivating the land. As found by the CA,
the respondent and her mother were living on the land, which was
being tilled by Miguel until 1985 when he was physically ousted by
the respondent.
Based on Article 538 of the Civil Code, the respondent is the
preferred possessor because, benefiting from her father's tax
declaration of the subject lot since 1926, she has been in
possession thereof for a longer period. On the other hand,
petitioners' father acquired joint possession only in 1952.
_____________________________________________________
Aragon v. Insular Government
G.R. No. 6019, 19 Phil. 223
March 25, 1911
CARSON, J.:
ISSUE: Whether or not applicant is entitled to possess the subject
land.
HELD: The facts of the case conclusively establish the right of
possession and ownership of the applicants.
Article 446 of the Civil Code is as follows:
Every possessor has a right to be respected in his possession;
and should he be disturbed therein, he must be protected or
possession must be restored to him by the means established in
the laws of procedure.
ART. 460. The possessor may lose his possession —
1. By the abandonment of the thing.
2. By transfer to another for a good or valuable consideration.
3. By the destruction or total loss of the thing or by the thing
becoming unmarketable.
4. By the possession of another, even against the will of the
former possessor, if the new possession has lasted more than one
year.
Under these provisions of the code it seems quite clear that if the
Government is justified in disturbing the possession of the
applicants, it can only be on the ground that they have abandoned
their property, or that it has been totally destroyed and has now
become a part of the public domain by the erosive action of the
sea. It is quite clear that applicants have never abandoned their
possession under a claim of ownership of this land.
Doubtless the property has been injured by the erosive action of
the sea. Doubtless the owners in order to profitably enjoy the
possession of this property will be compelled to make some
relatively small expenditures by way of a "fill" or a retaining wall.
But the actual condition of the property as it appears from the
record makes a claim that it has been totally lost or destroyed
preposterous and wholly untenable. We need hardly add that if the
applicants have not lost their right of possession, the
Government's claim of ownership, on the ground that this is a part
of the playa (shore) of Manila Bay, necessarily falls to the ground.
Our ruling in this case is merely that it affirmatively appears that
the owners of the land in question have never in fact nor in intent
abandoned it, and that keeping in mind its location and actual
condition it cannot be said to have been totally destroyed for the
purposes for which it was held by them, so as to have become a
part of the playa(shore) of the Bay of Manila.
_____________________________________________________
CATHOLIC VICAR APOSTOLIC OF THE MOUNTAIN
PROVINCE v. CA
G.R. No. 80294-95
September 21, 1988
GANCAYCO, J.:
Issue: Whether the petitioner has acquired the lots through
acquisitive prescription
Held: No. Private respondents were able to prove that their
predecessors' house was borrowed by petitioner Vicar after the
church and the convent were destroyed. They never asked for the
return of the house, but when they allowed its free use, they
became bailors in commodatum and the petitioner the bailee. The
bailees' failure to return the subject matter of commodatum to the
bailor did not mean adverse possession on the part of the
borrower. The bailee held in trust the property subject matter of
commodatum. The adverse claim of petitioner came only in 1951
when it declared the lots for taxation purposes. The action of
petitioner Vicar by such adverse claim could not ripen into title by
way of ordinary acquisitive prescription because of the absence of
just title.
_____________________________________________________
EDCA PUBLISHING & DISTRIBUTING CORP. vs. SANTOS
G.R. No. 80298
April 26, 1990
CRUZ, J.
ISSUE: Whether or not the petitioner may seize the books from
private respondents because it has been unlawfully deprived of
the books due to the dishonored check issued by the impostor.
HELD: NO. Ownership in the thing sold shall not pass to the buyer
until full payment of the purchase only if there is a stipulation to
that effect. Otherwise, the rule is that such ownership shall pass
from the vendor to the vendee upon the actual or constructive
delivery of the thing sold even if the purchase price has not yet
been paid. Non-payment only creates a right to demand payment
or to rescind the contract, or to criminal prosecution in the case of
bouncing checks. But absent the stipulation above noted, delivery
of the thing sold will effectively transfer ownership to the buyer
who can in turn transfer it to another.
Actual delivery of the books having been made, Cruz acquired
ownership over the books which he could then validly transfer to
the private respondents. The fact that he had not yet paid for them
to EDCA was a matter between him and EDCA and did not impair
the title acquired by the private respondents to the books. We
cannot see the justice in transferring EDCA's loss to the Santoses
who had acted in good faith, and with proper care, when they
bought the books from Cruz.
_____________________________________________________
CONSUELO S. DE GARCIA and ANASTACIO GARCIA vs.
HON. COURT OF APPEALS, ANGELINA D. GUEVARA and
JUAN B. GUEVARA
G.R. No. L-20264
January 30,1971
Fernando, J.
Issue: Whether or not a person who have been unlawfully
deprived of a movable may recover the same from the person in
possession of the same?
Held: YES. The controlling provision is Article 559 of the Civil
Code. It reads thus: "The possession of movable property
acquired in good faith is equivalent to a title. Nevertheless, one
who has lost any movable or has been unlawfully deprived thereof
may recover it from the person in possession of the same. If the
possessor of a movable lost of which the owner has been
unlawfully deprived, has acquired it in good faith at a public sale,
the owner cannot obtain its return without reimbursing the price
paid therefor." Respondent Angelina D. Guevara, having been
unlawfully deprived of the diamond ring in question, was entitled to
recover it from petitioner Consuelo S. de Garcia who was found in
possession of the same. The only exception the law allows is
when there is acquisition in good faith of the possessor at a public
sale, in which case the owner cannot obtain its return without
reimbursing the price.
_____________________________________________________
DOMINADOR DIZON v. LOURDES SUNTAY
G.R. No. L-30817
September 29, 1972
Fernando, J.
Issue: Whether or not Suntay has the right of possession over the
diamond ring which was pledged to Dizon’s pawnshop.
Held: Yes. The controlling provision is Article 559 of the Civil Code
which provides in part that one who has lost any movable or has
been unlawfully deprived thereof may recover it from the person in
possession of the same. Suntay having been unlawfully deprived
of the ring in question, is entitled to recover it from Dizon who was
found in possession of the same. Neither can Dizon’s defense of
estoppels stand. Estoppel has its roots in equity with good faith as
its basis. How then can petitioner in all seriousness assert that his
appeal finds support in the doctrine of estoppels?
Neither the promptings of equity nor the mandates of moral right
and natural justice come to his rescue. He is engaged in a
business where presumably ordinary prudence would manifest
itself to ascertain whether or not an individual who is offering
jewelry by way of a pledge is entitled to do so. If no such care be
taken, perhaps because of the difficulty of resisting opportunity for
profit, he should be the last to complain if thereafter the right of the
true owner of such jewelry should be recognized.
LEDESMA V COURT OF APPEALS
G.R. No. 86051.
September 1, 1992
Davide Jr, J
ISSUE: Whether private respondent was unlawfully deprived of
the cars when it sold the same to Rustico Consunji, through a
person who claimed to be Jojo Consunji, allegedly the latter’s son,
but who nevertheless turned out to be Armando Suarez, on the
faith of a Manager’s Check with a face value of P101,000.00,
dishonored for being altered, the correct amount being only
P101.00.chanrobles virtual lawlibrary
HELD: No. It is quite clear that a party who (a) has lost any
movable or (b) has been unlawfully deprived thereof can recover
the same from the present possessor even if the latter acquired it
in good faith and has, therefore, title thereto for under the first
sentence of Article 559, such manner of acquisition is equivalent
to a title. There are three (3) requisites to make possession of
movable property equivalent to title, namely: (a) the possession
should be in good faith; (b) the owner voluntarily parted with the
possession of the thing; and (c) the possession is in the concept of
owner.
Undoubtedly, one who has lost a movable or who has been
unlawfully deprived of it cannot be said to have voluntarily parted
with the possession thereof. This is the justification for the
exceptions found under the second sentence of Article 559 of the
Civil Code.
There was a perfected unconditional contract of sale between
private respondent and the original vendee. The former voluntarily
caused the transfer of the certificate of registration of the vehicle in
the name of the first vendee — even if the said vendee was
represented by someone who used a fictitious name — and
likewise voluntarily delivered the cars and the certificate of
registration to the vendee’s alleged representative Title thereto
was forthwith transferred to the vendee. The subsequent dishonor
of the check because of the alteration merely amounted to a
failure of consideration which does not render the contract of sale
void, but merely allows the prejudiced party to sue for specific
performance or rescission of the contract, and to prosecute the
impostor for estafa under Article 315 of the Revised Penal Code.
It was therefore erroneous for the respondent Court to declare that
the private respondent was illegally deprived of the car simply
because the check in payment therefor was subsequently
dishonored; said Court also erred when it divested the petitioner, a
buyer in good faith who paid valuable consideration therefor, of his
possession thereof.
AZARCON v. EUSEBIO
G.R. No. L-11977
April 29, 1959
LABRADOR, J.
Issue: Can the parties ousted in the property be entitled to the
palay they planted?
Held: Yes. The evidence shows that in spite of the receipt by the
defendants of the notice of the writ of execution of October 3,
1955, which writ of execution commanded defendants "to forthwith
remove from said premises and that plaintiff have restitution of the
same," defendants-appellants nevertheless entered the land to
gather palay which was then pending harvest. We gather further
from the record that the rice found on the disputed land at the time
of the service of the order of execution had been planted by
defendants-appellants, who appear to have been in possession of
the land from 1951. While the court order of October 3, 1955
ordered the defendant-appellant to move out from the premises, it
did not prohibit them from gathering the crop then existing
thereon. Under the law a person who is in possession and who is
being ordered to leave a parcel of land while products thereon are
pending harvest, has the right to a part of the net harvest, as
expressly provided by Article 545 of the Civil Code.
ART. 545. If at the time the good faith ceases, there should be any
natural or industrial fruits, the possessor shall have a right to a
part of the expenses of cultivation, and to a part of the net harvest,
both in proportion to the time of the possession.
CORDERO v. CABRAL
G.R. No. L-36789
July 25, 1983
Abad Santos, J.
Issue: Whether or not respondents were possessors in bad faith
and as such, are liable for the fruits of the lot subject to the
controversy.
Held: Yes. The controversy arose from the non-consummated
transaction between the Gregorio Ocampo, predecessor of
plaintiffs and Antonio Rodriguez, predecessor of defendants. The
Court of Appeals held that the sale between the two have never
materialized and Rodriguez' occupation of the land was merely as
a prospective owner and not adverse. Neither was it continuous
for 50 years since Ocampo was in possession of the same before
Rodriguez came to possession which was again merely with the
consent and toleration of Ocampo. The disputed land remains to
be included in the transfer certificate title issued to Ocampo. And
although the defendants claimed in their answer that plaintiff's
predecessor was only able to register the same in his name
through error or fraud, they made no claim of the alleged
transaction between their predecessors nor mentioned the name
of Antonio Rodriguez.
Hence, the defendants, by their own admission, are in
possession of the disputed land. There is no evidence that they
were possessors in bad faith. However, their good faith ceased
when they were served with summons to answer the complaint.
Possession acquired in good faith does not lose this character
except in the case and from the moment facts exist which show
that the possessor is not unaware that he possesses the thing
improperly or wrongfully. (Art. 528, Civil Code.) As possessors in
bad faith from the service of the summons they "shall reimburse
the fruits received and those which the legitimate possessor could
have received, ... (Art. 549, Civil Code.)
_____________________________________________________
Mendoza and Enriquez vs. De Guzman
G.R. No. 28721
October 5, 1928
MALCOLM, J.
ISSUE: Whether or not that in accordance with the provisions of
articles 435 and 454 in relation with article 361 of the Civil Code,
the value of the "indemnization" to be paid to the defendant should
be fixed according to the necessary and useful expenses incurred
by him in introducing "las plantaciones en cuestion"?
HELD: Yes. Article 361 of the Civil Code in the original Spanish
text uses the word "indemnizacion." However one may speculate
as to the true meaning of the term "indemnizacion" whether
correctly translated as "compensation" or "indemnity," the amount
of the "indemnizacion" is the amount of the expenditures
mentioned in articles 453 and 454 of the Civil Code, which in the
present case is the amount of the necessary and useful
expenditures incurred by the defendant. Necessary expenses
have been variously described by the Spanish commentators as
those made for the preservation of the thing (4 Manresa's
Comentarios al Codigo Civil, p. 258); as those without which the
thing would deteriorate or be lost (Scaevola's Comentarios al
Codigo Civil, p.408); as those that augment the income of the
things upon which they are expanded (4 Manresa's Comentarios
al Codigo Civil, p. 261; 8 Scaevola's Comentarios al Codigo Civil,
p. 416). Among the necessary expenditures are those incurred for
cultivation, production, upkeep, etc. (4 Manresa's Comentarios al
Codigo Civil, p. 257).
Here the plaintiffs have chosen to take the improvements
introduced on the land and are disposed to pay the amount of the
necessary and useful expenses incurred by the defendant.
Inasmuch as the retentionist, who is not exactly a possessor in
good faith within the meaning of the law, seeks to be reimbursed
for the necessary and useful expenditures, it is only just that he
should account to the owners of the estate for any rents, fruits, or
crops he has gathered from it.
_____________________________________________________
Robles and Martin vs. Lizzaraga Hermanos
G. R. No. L-16736
December 22, 1921
Romualdez, J:
Issue: Whether Evarista Robles is the owner of the aforesaid
improvements and has the right to demand payment of their value
and whether she has any right to retain the building until the said
value is paid to her.
Held: Attention is called to article 453 of the Civil Code which
reads:
Necessary expenditures shall be refunded to every possessor, but
only the possessor in good faith may retain the thing until they are
repaid to him.
Useful expenditures shall be paid the possessor in good faith with
the same right to retention, the person who has defeated him in
his possession having the opinion of refunding the amount of such
expenditures or paying him the increase in value which the thing
has acquired by reason thereof.
This provision of law is in force and applies to personal as well as
real property.wliThe expenditures incurred in these improvements
were not necessary inasmuch as without them the house would
have continued to stand just as before, but were useful, inasmuch
as with them the house better serves the purpose for which it was
intended, being used as a residence, and the improvements
consisting of the addition of a dining room, kitchen, closet, and
bathroom in the lower and upper stories of the house, and a
stable, suitable as a coach house and dwelling, it is beyond doubt
that such improvements are useful to the building.

Now then, was Evarista Robles a possessor in good faith when

she made those improvements? Article 434 provides that "good
faith is always presumed and the burden of proving bad faith on
the part of the possessor rests upon the person alleging it."
Lizarraga Hermanos did not allege, nor prove in the first instance
the bad faith characterizing Evarista Robles' possession, who, as
shown in the records and heretofore stated, began to occupy the
house by permission of the former owner, her mother Anastasia
de la Rama, and continued later in the occupation by the consent
of her coheirs, and afterwards by considering herself the future
owner of the building by virtue of the contract with the present
owner, Lizarraga Hermanos. The evidence shows that said
improvements were begun about the end of December, 1916,
after the agreement with Lizarraga Hermanos for the sale thereof
to Evarista Robles.

We find that in the court below the presumption of good faith in

favor of Evarista Robles' possession at the time she made the
improvements on the property was neither disputed nor discussed,
but on the contrary, there is positive evidence sufficient to support
the conclusion that when she made the improvements on the
aforesaid building she was possessing it in good faith.

If the improvements are useful and Evarista Robles' possession

was in good faith, the conclusion set out in article 453 of the Civil
Code, is inevitable; Evarista Robles is the owner of such
improvements, and entitled to reimbursement therefor, and to
retain the building until the same is made.

_____________________________________________________

METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM

v. THE COURT OF APPEALS and THE CITY OF DAGUPAN
G.R. No. L-54526
August 25, 1986
FERIA, J.:

ISSUE: Does a possessor in bad faith have the right to remove

useful improvements?

HELD: NO. Article 449 of the Civil Code of the Philippines

provides that "he who builds, plants or sows in bad faith on the
land of another, loses what is built, planted or sown without right to
indemnity." As a builder in bad faith, NAWASA lost whatever
useful improvements it had made without right to indemnity.

Moreover, under Article 546 of said code, only a possessor in

good faith shall be refunded for useful expenses with the right of
retention until reimbursed; and under Article 547 thereof, only a
possessor in good faith may remove useful improvements if this
can be done without damage to the principal thing and if the
person who recovers the possession does not exercise the option
of reimbursing the useful expenses. The right given a possessor in
bad faith is to remove improvements applies only to improvements
for pure luxury or mere pleasure, provided the thing suffers no
injury thereby and the lawful possessor does not prefer to retain
them by paying the value they have at the time he enters into
possession.

In Mindanao Academy, Inc. vs. Yap (13 SCRA 190), the Court
ruled that "if the defendant constructed a new building, as he
alleges, he cannot recover its value because the construction was
done after the filing of the action for annulment, thus rendering him
a builder in bad faith who is denied by law any right of
reimbursement."