PROPERTY

While a human being is alive, he cannot, as such, be the

object of a contract, for he is considered outside the
PROPERTY
commerce of man. He may donate part of his blood, may
even sell part of his hair, but he cannot sell his body
(Paras, 2008).
CHARACTERISTICS
Under the R.A. 7170 or the Organ Donation Act of 1991,
donation of all or a part of a human body may only occur
Property after a person’s “death” (i.e., the irreversible cessation of
circulatory and respiratory functions or the irreversible
It refers to all things which are or may be the object of cessation of all functions of the entire brain, including
appropriation considered as either real or personal the brain system) [R.A. 7170, as amended, Sec. 2(j)].
property (NCC, Art. 414). [Sec. 2(j), RA 7170, as amended]

It is an object or a right which is appropriated or

susceptible of appropriation by man, with capacity to CLASSIFICATIONS OF PROPERTY
satisfy human wants and needs (Pineda, 1999).

NOTE: Property does not only cover material things 1. As to mobility

because it mentions of rights which could either be a. Immovable or real property; and
classified as real or personal right. b. Movable or personal property.
--- 2. As to ownership
Q: Are the rights under the Bill of Rights considered a. Public dominion; and
as property? b. Private ownership.
3. As to alienability
A: NO. They are not susceptible of appropriation. a. Alienable; and
--- b. Inalienable.
Requisites for a thing to be considered as property 4. As to individuality
(USA) a. Specific property; and
b. Generic property.
1. Utility – Capacity to satisfy human wants; 5. As to susceptibility to touch
2. Substantivity/ Individuality – It has a separate and a. Tangible; and
autonomous existence. It can exist by itself and not b. Intangible.
merely as a part of a whole (Paras, 2008). 6. As to susceptibility to substitution
3. Appropriability - Susceptibility to a. Fungible; and
ownership/possession, even if not yet actually b. Non fungible.
appropriated. 7. As to accession
a. Principal; and
Properties NOT susceptible of appropriation b. Accessory.
8. As to existence
1. Common things (res communes) – a. Existing or present property (res
existentes); and
GR: Those properties belonging to everyone. While b. Future property (res futurae).
in particular no one owns common property, still in 9. As to consumability
another sense, res communes are really owned by a. Consumable; and
everybody in that their use and enjoyment are given b. Non-consumable.
to all of mankind (Paras, 2008). 10. As to divisibility
e.g. air, wind, sunlight a. Divisible; and
b. Indivisible.
XPN: Those that may be appropriated under certain
conditions in a limited way. CLASSIFICATION OF PROPERTY BY MOBILITY
e.g. Electricity
REAL OR IMMOVABLE PROPERTY
2. Not susceptible due to physical impossibility (1995, 1997, 2007 Bar)
e.g. Sun
Categories of immovable property:
3. Not susceptible due to legal impossibility
e.g. Human body Real properties are categorized by: (NIDA)

The human body is NOT a property

It is neither real nor personal property, whether alive or

dead. It is not even property at all, in that it generally
cannot be appropriated.
 PROPERTY
1. Nature – Those which cannot be carried from place
to place;
2. Incorporation – Those which are attached to an
immovable in a fixed manner and considered as an
integral part thereof, irrespective of its ownership;
3. Destination – Things placed in buildings or on lands
by the owner of the immovable or his agent in such
a manner that it reveals the intention to attach them
permanently thereto; and
4. Analogy – Classified by express provision of law.
IMMOVABLE BY NATURE AND INCORPORATION
Par. 1, Art. 415. Land, buildings, roads and
constructions of all kinds adhered to the soil.
Land
By its very nature is immovable property. In whatever
transaction land is involved, it is always immovable.
A truckful of soil taken from the land (like garden soil)
becomes a personal property because it is no longer
adhered to the land. However, the moment it is used to
cover a land for ornamentation or gardening, it becomes
immovable again (Pineda, 2009).
Building
GR: A building is always immovable whether built in
one’s own land or rented.
XPN: When a building is merely superimposed on the
soil or is sold for immediate demolition, in which case it
may be considered as movable or personal property.
e.g. Barong-barongs are not permanent structures but
mere superimpositions on land.
Effect of demolition of a house
Once a house is demolished, its character as an
immovable ceases because a house is classified as an
immovable property by reason of its adherence to the
soil on which it is built (Bicerra v. Teneza, G.R. No. L-
16218, November 29, 1962).
Mortgage of a building erected on a land belonging to
another
A building, by itself, may be mortgaged apart from the
land on which it was built even if a mortgage of land
necessarily includes, in the absence of stipulation of the
improvements thereon, buildings. Such a mortgage
would still be a real estate mortgage (REM) for the
building would still be considered immovable property
even if dealt with separately and apart from the land
(Yee v. Strong Machinery Company, G.R. No. 11658,
February 15, 1918).
A building can be the subject of a chattel mortgage
When the parties have so expressly designated,
especially when it is considered that the property given
as a security is a house of mixed materials which by its
very nature is considered as personal property (Luna v.
Encarnacion, G.R. No. L-4637, June 30, 1952).
Requisites for a building to be the subject of a chattel
mortgage
1. Parties mutually agreed to consider the house a
personal property; and
2. That no innocent third party is prejudiced.
NOTE: Under the doctrine of estoppel, parties to a
contract who agreed to treat as personal property that
which by nature would be real property are prohibited
from assuming inconsistent positions and repudiating an
obligation voluntarily assumed.
A building, subjected to a chattel mortgage cannot be
sold extrajudicially (Pineda, 2009).
Par. 2, Art. 415. Trees, plants and growing fruits,
while they are attached to the land or form an
integral part of an immovable.
Trees and plants
Trees may be either be:
1. A real property; or
a. By nature - If they are spontaneous
products of the soil; or
b. By incorporation - If they have been
planted through cultivation or labor.
2. A personal property.
The moment trees are detached or uprooted
from the land it is considered as personal
property.
NOTE: In case of uprooted timber, they are still
not considered as personal property because
timber is an integral part of the timber land.
Growing fruits
GR: Growing fruits are considered as real property so
long as they are still attached to the soil. Once removed
from the soil, they become personal properties.
XPN: Growing fruits still attached to the soil may be
treated as personal property for purposes of:
1. Sale of the whole or part of the crops
2. Attachment and execution; and
3. Applying the provisions of the Chattel Mortgage
Law (Rabuya, 2008).
XPN: Growing fruits may be exceptionally treated as
personal property pursuant to the provisions of Art.
416(2) of the New Civil Code (Rabuya, 2008).
E.g.
4. For the purposes of sale of the whole or part of the
crops
5. For purposes of attachment and execution; and
6. For applying the provisions of the Chattel Mortgage
Law.
 PROPERTY
incorporation. destination.

IMMOVABLE BY INCORPORATION Par. 5, Art. 415. Machinery, receptacles, instruments

Par. 3, Art. 415. Everything attached to an
immovable in a fixed manner, in such a way that it
cannot be separated therefrom without breaking the
material or deterioration of the object.
Res vinta
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 & which
tend directly to meet the needs of the said industry or
works.
Requisites for machinery to be considered real
property (COTE)

These are immovables by incorporation, which when
separated from the immovable, regain their condition as
movable.
Steel towers are personal properties
They are not buildings adhered to the soil [(NCC, Art.
415(1)]; they are not attached to an immovable in a fixed
manner; they can be separated without substantial
damage or deterioration, and they are not machineries
intended for works on the land (Board of Assessment
Appeals v. Meralco, G.R. No. L-15334, January 31, 1964).
1. The industry or work must be Carried on in a
building or on a piece of land; and
2. The machinery must:
a. Be placed by the Owner of the tenement or
his agent;
b. Tend directly to meet the needs of the said
industry or work; and
c. Be Essential and principal to the industry
or work, and not merely incidental thereto.
Machinery placed by a tenant or by a usufructuary is
NOT real property.

IMMOVABLE BY INCORPORATION & BY Since it is placed by a person having only a temporary

DESTINATION
Par. 4, Art. 415. Statues, reliefs, paintings or other
objects for use or ornamentation, placed in
buildings or on lands by the owner of the
immovable in such a manner that it reveals the
intention to attach them permanently to the
tenements.
“Placed by the owner”
This means that the objects must be placed by the owner
of the immovable and not necessarily the owner of the
object.
right, it does not become immobilized (Valdez v. Central
Altagracia, 225 U.S. 58, 1912).
Where a tenant places the machinery under the express
provision of lease that it shall become a part of the land
belonging to the owner upon the termination of the lease
without compensation to the lessee, the tenant acts as an
agent of the owner and the immobilization of the
machineries arises from the act of the owner in giving by
contract a permanent destination to the machinery.
(Ibid.)
Equipment and living quarters of the crew
permanently attached are immovable properties

Requisites It is intended to meet the needs of the industry being

undertaken by MPC. The equipment partakes of the
1. Placed by the owner or (by the tenant) as agent nature of the immovable upon which it has been placed.
of the owner; and
2. With the intention of attaching them The living quarters, if attached to the immovable
permanently even if adherence will not involve platform with permanence, becomes an immovable as
breakage or injury. well. Permanence means they cannot be separated
Par. 3 distinguished from Par. 4 without destroying the platform or the quarters. If the
attachment is not permanent, or not merely
PAR. 3 PAR. 4 superimposed on the platform, then the living quarters
are movable properties (2007 Bar).
Can be separated from
Cannot be separated
the immovable without Equipment of a transportation business classified as
from the immovable
breaking or deterioration. personal property
without breaking or
deterioration.
A transportation business is not carried on in a building
Must be placed by the or on a specified land. Hence, equipment destined only to
Need not be placed by repair or service a transportation business may not be
owner of the immovable,
the owner. deemed real property, but personal property.
or by his agent whether
express or implied.
Machines must be essential and principal elements in the
industry and must directly meet the needs of said
Real property by industry. It does not include movables which are merely
Real property by
incorporation and
 PROPERTY
incidentals, without which the business can still continue
or carry on their functions.
Cash registers, typewriters, etc. usually found and used
in hotels and restaurants are merely incidentals not
considered immobilized by destination because these
businesses can carry on their functions without these
equipments (Mindanao Bus Co. v. City Assessor and
Treasurer, G.R. No. L-17870, September 29, 1962).
Machineries bolted or cemented on real property
mortgaged
It is NOT considered an immovable property. The fact
that machineries were bolted or cemented on real
property mortgaged does not make them ipso facto
immovable under Art. 415 (3) and (5) as the parties
intent has to be looked into.
When immovable property by nature may be treated
as a chattel
Even if the properties appear to be immovable by nature,
nothing detracts the parties from treating them as
chattels to secure an obligation under the principle of
estoppel (Tsai v. CA, G.R. No. 120098, October 2, 2001).
Effect of temporary separation of movables from the
immovables to which they are attached
There are two views;
1. They continue to be regarded as immovables;
and
2. Fact of separation determines the condition of
the objects thus recovering their condition as
movables.
Machines though essential and principal elements of
the industry are personal properties when provided
in the lease agreement
The machines should be deemed personal property
pursuant to the Lease Agreement – is good only insofar
as the contracting persons are concerned. Hence, while
the parties are bound by the Lease Agreement, third
persons acting in good faith are not affected by its
stipulation characterizing the subject machinery as
personal (Serg’s Products, Inc. v. PCI Leasing and Finance,
Inc., G.R. No. 137705, August 22, 2000).
Par. 6, Art. 415. Animal houses, pigeon-houses,
beehives, fish ponds or breeding places of similar
nature, in case their owner has placed them or
preserves them with the intention to have them
permanently attached to the land, and forming a
permanent part of it; the animals in these places
are included.
These are immovables by destination. They are
considered as real property if adhered to the soil in a
permanent manner. The animals in the houses are
considered part of the immovable.
Beehives, Fishponds Or Breeding Places of Similar
Nature Are Real Property; Animals Contained
Therein, Included
When purposely constructed or attached to the ground
or on another immovable (like a tree-wall), fishponds
and other similar breeding places, like cemented
container where breeding of fishes or crustaceans is
done, are considered immovable property if the owner of
the land or tenement intended them to be permanent
The animals in the animal houses, the pigeons in the
pigeon houses, the bees in the beehives, the fish in the
fishponds are included and considered part of the
immovable property (Pineda, 2009).
Cages are not included
It will be considered as personal property since they can
be moved from one place to another.
Par. 7, Art. 415. Fertilizer actually used on a piece
of land.
Fertilizers in sacks are not included
Fertilizers which are still in the sacks, although there is
intention to place them or use them on land, are
movable. Only fertilizers actually used on a piece of land
are deemed immovable since it is already placed in the
land and can never be separated from it.
Par. 8, Art. 415. Mines, quarries and slag dumps,
while the matter thereof forms part of the bed, and
waters either running or stagnant.
By their nature, mines quarries and slag dumps are
immovable property.
Mines - These are mineral lands where excavations are
done to extract minerals such as gold, ores etc.
Quarries - These are lands where stones are chipped of
or where sand is being extracted.
Slag dumps - They consist of waste and dirt taken from
a mine and mounted on the surface of the ground under
excavation
Running or Stagnant Waters – These waters refer to
waters still running through the soil or ground in mines
and quarries (Pineada, 2009).
Par. 9, Art. 415. Docks and structure which, though
floating, are intended by their nature and object to
remain at a fixed place on a river, lake or coast.
When power barges are classified as real properties
Power barges are categorized as immovable property by
destination, being in the nature of machinery and other
implements intended by the owner for an industry or
work which may be carried on in a building or on a piece
of land and which tend directly to meet the needs of said
 PROPERTY
industry or work (Fels Energy, Inc. v. Province of
Batangas, G.R. No. 168557, February 19, 2007).
Floating platform is an immovable property
The platform is an immovable property by destination. It
was intended by the owner to remain at a fixed place on
a river or coast. Art. 415 (9) of the NCC considers as real
property “docks and structures which, though floating
are intended by their nature and object to remain at a
fixed place on a river, lake, or coasts” (Fels Energy, Inc. v.
The Province of Batangas, G.R. No. 168557, February 16,
2007).
Vessels are considered personal property under the civil
law and common law and occasionally referred to as
peculiar kind of personal property. It is essential that a
record of documents affecting the title to a vessel be
entered in the record of the Collector of Customs at the
port of entry (Code of Commerce, Art. 585).
Par. 10, Art. 415. Contracts for public works and
servitudes and other real rights over immovable
property.
These are immovables by analogy.
Immovable By Analogy
These properties refer to contracts for public works,
servitudes and real rights over immovable property (like
usufruct). They are inseparable from their sources which
are immovable, Hence, for convenience, they are
considered immovable not by their nature, destination
or incorporation but by analogy. While no tangible, they
have the characteristics of real property (Pineda, 2009).
e.g. Contract over a construction of a bridge
Art. 416. The following things are deemed to be
personal property:
(1) Those movables susceptible of appropriation
which are not included in the preceding article;
(2) Real property which by any special provision of
law is considered as personalty
(3) Forces of nature which are bought under
control by science; and
(4) In general, all things which can be transported
from place to place without impairment of the real
property to which they are fixed.
Art. 417 The following are also considered as
personal property:
(1) Obligations and actions which have for their
object movables or demandable sums; and
(2) Shares of stock of agricultural, commercial and
industrial entities, although they may have real
estate
PERSONAL OR MOVABLE PROPERTY
1995 Bar
Movable properties (SOFTSS)
1. Movables Susceptible of appropriation which
are not included in Art. 415;
2. Real property which by any Special provision of
law considers as personalty;
e.g. Growing crops under the Chattel Mortgage
Law
3. Forces of nature which are brought under the
control of science ;
e.g. Electricity generated by electric powers,
solar light for batteries power.
4. In general, all things which can be Transported
from place to place without impairment of the
real property to which they are fixed (NCC, Art.
416);
5. Obligations and actions which have for their
object movables or demandable sums; and
6. Shares of stock of agricultural, commercial and
industrial entities, although they have real
estate (NCC, Art. 417).
Special Kind of Personal Property
The author, composer, painter, sculptor, inventor have
rights over their works. These rights are personal
property (Pineda, 2009).
Interest in business is a personal property
With regard to the nature of the property mortgaged
which is one-half interest in the business, such interest is
a personal property capable of appropriation and not
included in the enumeration of real properties in articles
335 of the Civil Code, and may be the subject of mortgage
(Strochecker v. Ramirez, G.R. No. 18700, September 26,
1922).
The business of providing telecommunication is a
personal property
The business of providing telecommunication or
telephone service is likewise personal property which
can be the object of theft under Art. 308 of the RPC.
Indeed, while it may be conceded that international long
distance calls, the matter alleged to be stolen in the
instant case, take the form of electrical energy, it cannot
be said that such international long distance calls were
personal properties belonging to PLDT since the latter
could not have acquired ownership over such calls. PLDT
merely encodes, augments, enhances, decodes and
transmits said calls using its complex communications
infrastructure and facilities (Laurel v. Abrogar, G.R. No.
G.R. No. 155076, January 13, 2009).
Tests to determine whether a property is a movable
property (MES)
a. Test of Exclusion – Everything not included in Art.
415 of NCC; e.g. ships or vessels or interest in a
business
 PROPERTY
b. By reason of a Special law – Immovable by nature
but movable for the purpose of the special law; e.g.
Growing crops for purposes of the Chattel Mortgage
Law
c. Test of Mobility – If the property is capable of being
carried from place to place without injuring the real
property to which it may in the meantime be
attached.
Art. 418. Movable property is either consumable or
non-consumable. To the first class belong those
movables which cannot be used in a manner
appropriate to their nature without their being
consumed; to the second class belong all others.
CLASSIFICATION OF PROPERTY BY NATURE
Properties classified according to consumability
1. Consumable property – That which cannot be
used according to its nature without being
consumed or being eaten or used up; and
2. Non-consumable property – That which can be
used according to its nature without being
consumed or being eaten or used up.
Properties classified according to susceptibility to
substitution
1. Fungible property – That property which
belongs to a common genus permitting its
substitution; and
2. Non- fungible property – That property which is
specified and not subject to substitution.
NOTE: As to whether a property is fungible or non-
fungible is determined by the agreement of the
parties and not on the consumability of the thing.
Art. 419. Property is either of public dominion or of
private ownership
CLASSIFICATION OF PROPERTY BY OWNERSHIP
1. In relation to the State
a. Public Dominion; and
b. Patrimonial.
2. In relation to political subdivisions/local
government unit
a. Public use; and
b. Patrimonial.
3. In relation to private persons
a. Owned individually; and
b. Owned collectively.
NOTE: Sacred and religious objects are considered
outside the commerce of man. They are neither public
nor private party (Barlin v. Ramirez, G.R. No. L-2832,
November 24, 1906).
PUBLIC DOMINION
It means ownership by the public in general. It may also
mean properties or things held by the State by regalian
right.
Properties classified as public dominion cannot be
alienated but are not totally outside the commerce of
man as the Constitution allows the State to enter into co-
production, joint ventures or production-sharing
agreements with private individuals or corporations for
their exploration, development and utilization.
NOTE: In order to be classified as property of public
dominion, an intention to devote it to public use or to
public service is sufficient and it is not necessary that it
must actually be used as such.
Art. 420. The following things are property of
public dominion:
(1)Those intended for public use, such as roads,
canals, rivers, torrents, ports and bridges
constructed by the State, banks, shores, roadsteads,
and others of similar character;
(2)Those which belong to the State, without being
for public use, and are intended for some public
service or for the development of the national
wealth.
Q: Iloc Bilag sold a sold to respondents separately
various portions of a 159,496-square meter parcel of
land designated by the Bureau of Lands as Approved
Plan No. 544367, Psu 189147 situated at Sitio Benin,
Baguio City (subject lands), and that they registered
the corresponding Deeds of Sale[6] with the Register
of Deeds of Baguio City. This land is forms part of the
Baguio Townsite Reservation which is a public land.
Respondents, alleged to have been harassed and
threatened by petitioners, filed a petition for
Quieting of title with prayer of Preliminary
Injunction before the RTC Br. 61 . Petitioners
countered, among others, that RTC has no
jurisdiction. Should the petition be granted?
A: No. since the subject lands are untitled and
unregistered public lands, then petitioners correctly
argued that it is the Director of Lands who has the
authority to award their ownership.[30] Thus, the RTC Br.
61 correctly recognized its lack of power or authority to
hear and resolve respondents' action for quieting of title.
Kinds of property of public dominion (USD)
1. For public Use;
2. Intended for public Service and not for public
use; and
3. For the Development of the national wealth
(NCC, Art. 420).
Characteristics of properties of public dominion
(ULEP-ROB)
1. In general, they can be Used by everybody;
 PROPERTY
2. Cannot be Levied upon by execution or
attachment;
3. May Either be real or personal property;
4. Cannot be acquired by Prescription;
5. Cannot be Registered under Land Registration
Law and be the subject of Torrens Title;
6. Outside the commerce of man – cannot be
alienated or leased or be subject of any
contract;
7. Cannot be Burdened by voluntary easement.
Art. 421. All other property of the State, which is
not of the character stated in the preceding article,
is a patrimonial property.
Patrimonial Property
This is a property pertaining to the State which is not
intended for public use, public service, or for the
development of the national wealth. It is intended rather
for the attainment of the economic ends of the State, that
is, for its subsistence.
Art. 422. Property of public dominion, when no
longer intended for public use or for public service,
shall form part of the patrimonial property of the
State.
Conversion From Property of Public Dominion To
Patrimonial Property, How Effected.
When no longer intended or operated for public use or
public service, a property of public dominion shall form
part of the State’s patrimonial property as of the date the
Government, through the Executive or Legislative
Departments, has formally declared that it is no longer
needed for said purposes (Ignacio vs. Director of Land
[S.C], 58 Off. Gaz. 2403 [1960]; Cebu Oxygen Acetylynne Co.
vs. Bercilles, 66 SCRA 481).
Art. 423. The property of provinces, cities, and
municipalities is divided into property for public
use and patrimonial property
Art. 424. Property for public use, in the provinces,
cities, and municipalities, consist of the provincial
roads, city streets, municipal streets, the squares,
fountains, public waters, promenades, and public
works for public service paid by said provinces,
cities, or municipalities
All other property possessed by any of them is
patrimonial and shall be governed by this Code,
without prejudice to the provisions of special laws.
Properties for public service and properties for the
development of national wealth
1. Public service – It depends on who pays for the
service. If paid for by the political subdivision,
public; if for profit, patrimonial; and
2. National wealth – It is still property for public
use under the regalian doctrine.
Property of municipal corporations
1. Provincial roads;
2. City streets;
3. Municipal streets;
4. Squares;
5. Fountains;
6. Public waters;
7. Promenades; and
8. Public works for public service paid for by said
provinces, cities, or municipalities (NCC, Art.
424).
NOTE: All other property possessed by any of them
are patrimonial.
Charging of fees does not remove property as public
dominion
The charging of fees to the public does not determine the
character of the property whether it is of public
dominion or not. The airport lands and buildings are
devoted to public use because they are used by the
public for international and domestic travel and
transportation. The terminal fees MIAA charges to
passengers, as well as the landing fees MIAA charges to
airlines, constitute the bulk of the income that maintains
the operations of MIAA (Manila International Airport
Authority v. CA, G.R. No. 155650, July 20, 2006).
PRIVATE OWNERSHIP
Art. 425. Property of private ownership, besides
the patrimonial property of the State, provinces,
cities, and municipalities, consists of all property
belonging to private persons, either individually or
collectively.
Properties in private ownership of private persons
or entities (NCC, Art.425)
All properties not belonging to the State or its political
subdivision are properties of private ownership
pertaining to private persons, either individually or
collectively.
Patrimonial property of the State
It is the property intended for the attainment of the
economic ends of the State, that is, for subsistence. It is
owned by the State in its private or proprietary capacity.
It is the property not devoted to public use, public
service, or the development of the national wealth.
An executive or legislative act is necessary to reclassify
property into patrimonial. The conversion cannot be
inferred from non-use.
NOTE: It may be disposed of by the State in the same
manner that private individuals dispose of their own
 PROPERTY
property subject, however, to administrative laws and
regulations.
The fact that the Roppongi site has not been used for a
long time for actual Embassy service does not
automatically convert it to patrimonial property. An
abandonment of the intention to use the Roppongi
property for public service and to make it patrimonial
property must be definite. Abandonment cannot be
inferred from the non-use alone (Laurel vs Garcia, G.R.
No. 92013, July 25, 1990).
Any such conversion happens only if the property is
withdrawn from public use. Accordingly, the withdrawal
of the property in question from public use by the City of
Cebu and its subsequent sale to the petitioner is valid
(Cebu Oxygen and Acetylene Co. v. Bercilles, 66 SCRA 481,
August 29, 1975).
Sewage system of a city is a patrimonial property
It is property of the city, purchased with private funds
and not devoted to public use (it is for profit). It is
therefore patrimonial under the Civil Code. Nor can the
system be considered “public works for public service”
under Art. 424 because such classification is qualified by
ejusdem generis; it must be of the same character as the
preceding items (City of Cebu v. NAWASA, G.R. No. 12892,
April 20, 1960).
Private ownership of land prohibited to Aliens;
KRIVENKO DOCTRINE
General Rule: Aliens have no right to acquire any public
or private agricultural, commercial or residential lands
in the Philippines.
XPN: Aliens may only acquire such lands by hereditary
succession (Krivenko vs Registry of deeds, G.R. No. L-
630, November 15, 1947).
Effect of a subsequent sale by the disqualified alien
vendee to a qualified Filipino citizen
If land is invalidly transferred to an alien who
subsequently becomes a citizen or transfers it to a
citizen, the flaw in the original transaction is considered
cured and the title of the transferee is rendered valid.
Thus, the subsequent transfer of the property to
qualified Filipinos may no longer be impugned on the
basis of invalidity of the initial transfer. The objective of
the constitutional provision to keep our lands in Filipino
hands has been achieved (Lee v. Republic of the
Philippines, G.R. No. 12819, October 3, 2001).
NOTE: The constitutional proscription on alien
ownership of lands of the public or private domain was
intended to protect lands from falling in the hands of
non-Filipinos (Lee v. Republic of the Philippines, G.R. No.
12819, October 3, 2001).
Regalian Doctrine: All lands not otherwise appearing to
be clearly within private ownership are presumed to be
owned by the state (Pineda, 2009).
Reversion - An action where the ultimate relief sought is
to revert the land back to the government under the
Regalian Doctrine (Pineda, 2009).
Art. 426. Whenever by provision of the law, or an
individual declacration, the expression “immovable
things or property,” or “movable things or
property, “is used, it shall be deemed to include,
respectively, the things enumerated in Chapter 1
and in Chapter 2.
Whenever the word “muebles,” or “furniture,” is
used alone, it shall not be deemed to include
money, credits, commercial securities, stocks and
bonds, jewelry, scientific or artistic collection,
books medals, arms, clothing, horses or carriages
and their accessories, grains, liquids and
merchandise, or other things which do not have as
their principal object the furnishing or
ornamenting of a building except where from the
context of the law, or the individual declaration,
the contrary clearly appears.
“Muebles” Or “Furniture” When Used Alone; Effects.
If used alone in a contract or agreement, it will not
include things found therein like money, jewelry,
collections, books, medals, arms, clothing, etc., which do
not have as their principal purpose the furnishing or the
ornamenting of the building where the “muebles” or
“furniture” is found.
XPN: When the law or the individual declaration clearly
provides that the aforesaid things are included.
OWNERSHIP
Art. 427. Ownership may be exercised over things
or rights.
It is the juridical relation of a person over a thing by
virtue of which said person has the exclusive power or
authority to receive all the benefits and advantages
arising from said thing, save those restricted by law or
the recognized rights of others.
Kinds of ownership
1. Full ownership – Includes all the rights of an owner;
NOTE: Naked ownership + Usufruct
2. Naked ownership – Ownership where the rights to
the use and to the fruits have been denied;
NOTE: Full ownership – Usufruct
 PROPERTY
3. Sole ownership – Ownership is vested in only one
person; and
4. Co-ownership– Ownership is vested in two or more
persons. There is Unity of the property, and
plurality of the subjects.
Characteristics of ownership
1. Elastic – Power/s may be reduced and thereafter
automatically recovered upon the cessation of the
limiting rights;
2. General – The right to make use of all the
possibilities or utility of the thing owned, except
those attached to other real rights existing thereon.
3. Exclusive – There may be two or more owners, but
only one ownership;
4. Independent – Other rights are not necessary for its
existence; and
5. Perpetual – Ownership lasts as long as the thing
exists. It cannot be extinguished by non-user but
only by adverse possession.
Q: Respondents inherited the subject property from
Emiliana Bacalso, by virtue of Decree No. 98992.
Sometime later, they found the heirs of Alejandra Delfin
to be occupying the said property, to which they even
constructed houses there. The heirs argued they have
better right for it was inherited to them after it was
bought by the predecessor from Emiliana Bacalso; also,
they are the ones paying the subject property’s realty
taxes. Do the respondents have the better right to the
ownership and possession of the subject property?
A: Yes, respondents have the better right to the ownership
and possession of the subject property. The basis is the LRA
certification, daybook entry, and Decree No. 98992 that was
issued to Emiliana Bacalso. The Decree bars all claims and
rights which arose as may have existed prior to the decree of
registration.
Art. 428. The owner has the right to enjoy and
dispose of a thing, without other limitations than
those established by law.
The owner has also a right of action against the
holder and possessor of the thing in order to
recover it.
Art. 429. 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
JUS UTENDI, FRUENDI, ABUTENDI, VINDICANDI,
DISPODENDI, POSSIDENDI, ACCESIONES
Attributes of ownership
1. Right to enjoy (jus utendi); (NCC, Art. 428)
2. Right to the fruits (jus fruendi);
3. Right to abuse (jus abutendi);
4. Right to dispose (jus dispodendi); (NCC Art. 428)
5. Right to recover (jus vindicandi); (NCC. Art. 428)
6. Right to accessories (jus accessiones); and
7. Right to possess (jus possidendi).
8. Right to exclude (NCC, Art. 429)
9. Right to enclose (NCC, Art. 430)
Lease merely follows the property as a lien or
encumbrance
---
Q: Palado, owner of a building containing
commercial spaces for lease, sold his property to One
Network bank. Baric, a former tenant of Palado, filed
a case for forcible entry against Palado and One
Network. Baric claims he should be paid the cost of
the renovations made in the leased commercial
space and damages as well. May a buyer in good faith
be held liable for forcible entry?
A: NO. One Network Bank is not prohibited from
acquiring the property even while the forcible entry case
was pending, because as the registered owner of the
subject property, Palado may transfer his title at any
time and the lease merely follows the property as a lien
or encumbrance. Any invasion or violation of Baric's
rights as lessee was committed solely by Palado, and One
Network Bank may not be implicated or found guilty
unless it actually took part in the commission of illegal
acts, which does not appear to be so from the evidence
on record (One Network Rural Bank, Inc. v. Baric, G.R. No.
193684, March 5, 2014) (Del Castillo, J.)
Q: On April 15, 1991, Nicolasa authorized her
daughter, Carmelita, Artemio's sister, to mortgage
the subject property to Jose, the predecessor-in-
interest of Jose, Jose Jr. and Virginia in order to
secure a loan in the amount of P112,000.00. As
Nicolasa failed to settle her loan obligation when it
fell due, Jose, led an application for extra-judicial
foreclosure of mortgage before the Regional Trial
Court of Olongapo City, Branch 72 (RTC), docketed as
Case No. 07-0-91. After the requirements of posting,
notices, and publication were complied with, the
subject property was sold at a public auction, where
Jose emerged as the highest bidder. A Certificate of
Sale was thus issued in his favor. The period of
redemption expired without the subject property
being redeemed; hence, a Final Bill of Sale was
issued and registered in Jose's name. Thereafter, the
latter executed an Affidavit of Consolidation of
Ownership. This notwithstanding, Nicolasa persisted
in her occupancy of the subject property and refused
to deliver possession to Jose. Is the Writ of
Possession and Notice to Vacate issued by the RTC is
valid?
A: Yes. "It is well-settled that the purchaser in an
extrajudicial foreclosure of real property becomes the
absolute owner of the property if no redemption is made
within one [(1)] year from the registration of the
certificate of sale by those entitled to redeem. As
 PROPERTY
absolute owner, he is entitled to all the rights of
ownership over a property recognized in Article 428 of
the New Civil Code, not least of which is possession, or
jus possidendi[.]"
It should be clarified that the purpose of a petition for
the issuance of a writ of possession under Act No. 3135,
as amended by Act No. 4118, is to expeditiously accord
the mortgagee who has already shown a prima facie
right of ownership over the subject property (based on
his consolidated title over the same) his incidental right
to possess the foreclosed property. To reiterate, "
[p]ossession being an essential right of the owner with
which he is able to exercise the other attendant rights of
ownership, after consolidation of title[,] the purchaser in
a foreclosure sale may demand possession as a matter of
right."
Thus, it is only upon a credible showing by a third party
claimant of his independent right over the foreclosed
property that the law's prima facie deference to the
mortgagee's consolidated title should not prevail. Verily,
a mere claim of ownership would not suffice. As
jurisprudence prescribes, the demonstration by the third
party-claimant should be made within the context of an
adversarial hearing, where the basic principles of
Evidence and Civil Procedure ought to be followed, such
as: (1) it is the claimant who has the burden of proving
his claim; (2) the claim must be established through a
preponderance of evidence; and (3) evidence not
presented or formally offered cannot be admitted against
the opposing party. In this case, none of these principles
were followed for the CA considered evidence that were
not only submitted in a totally different case against an
entirely different party, but are also innately inadequate
to — at least — prima facie show the source of the third
party claimant's independent title, all to the detriment of
the mortgagee who had already consolidated his title to
the contested property.
---
REMEDIES TO RECOVER POSSESSION
Legal remedies to recover possession of one’s
property
1. Personal property – Replevin
2. Real property
a. Accion Interdictal;
i. Forcible entry; or
ii. Unlawful detainer.
b. Accion Publiciana; or
c. Accion Reinvindicatoria.
3. Ancillary remedies common to both
a. Writ of preliminary mandatory injunction;
or
b. Writ of possession.
Q: Spouses Gregorio and Rosario Centeno previously
owned the subject lots, which they mortgaged in
favor of Rural Bank of Sta. Barbara, Inc. as security
for a P1,753.65 loan. Sps. Centeno, however,
defaulted on the loan, prompting the bank to cause
the extrajudicial foreclosure of the mortgage.
Consequently, the subject lots were sold to the bank,
being the highest bidder at the auction sale.Sps.
Centeno failed to redeem the subject lots within the
one-year redemption period pursuant to Section 6 of
Act No. 3135. Yet, they still continued with the
possession and cultivation of the aforesaid
properties.
Gerry Centeno, son of Sps. Centeno, later on
purchased the said lots from his parents.
Accordingly, Rosario paid the capital gains taxes on
the sale transaction and tax declarations were
eventually issued in the name of Gerry.
On March 19, 1998, Rural Bank of Sta. Barbara, Inc.
filed a petition for the issuance of a writ of
possession before the trial court, claiming
entitlement to the said writ by virtue of the Final
Deed of Sale covering the subject lots. Gerry opposed
the petition, arguing that he purchased and has, in
fact, been in actual, open and exclusive possession of
the same properties for at least 15 years. Is the Rural
Bank of Sta. Barbara, Inc. is entitled to a writ of
possession over the subject lots?
A: Yes. It is well-established that after consolidation of
title in the purchasers’ name for failure of the mortgagor
to redeem the property, the purchasers right to
possession ripens into the absolute right of a confirmed
owner. At that point, the issuance of a writ of possession,
upon proper application and proof of title, to a purchaser
in an extrajudicial foreclosure sale becomes merely a
ministerial function, unless it appears that the property
is in possession of a third party claiming a right adverse
to that of the mortgagor.
Gerry Centeno acquired the subject lots from his parents,
Sps. Centeno, on March 14, 1988 after they were
purchased by Rural Bank of Sta. Barbara, Inc. and its
Certificate of Sale at Public Auction was registered with
the Register of Deeds of Iloilo City in 1971. It cannot
therefore be disputed that Gerry is a mere successor-in-
interest of Sps. Centeno. Consequently, he cannot be
deemed as a third party who is actually holding the
property adversely to the judgment obligor under legal
contemplation.
Q: On June 26, 2003, petitioner Teodorico A.
Zaragoza (petitioner) bought a 3,058-square meter
(sq. m.) parcel of land. His father leased[7] a 1,000-sq.
m. portion of Lot 937-A (subject land) to respondent
Iloilo Santos Truckers, Inc. (respondent.[8] This
notwithstanding, petitioner allowed the lease to
subsist and respondent had been diligent in paying
its monthly rent amounting to P10,000.00 per
month. Petitioner claimed that when his father died,
respondent stopped paying rent. On the other hand,
respondent maintained that it was willing to pay
rent, but was uncertain as to whom payment should
be made. Respondent made a consignation on the
RTC br. 24 for the amount of P521,396.89 equivalent
for the rent of February 2007 to March 2011.
Petitioner averred that the amount was insufficient
to cover the unpaid rentals plus interests from
February 2007 to May 2011. Petitioner clarified that
his earlier demand to pay was for the period of
February 2007 to May 2011. Thus, petitioner posited
 PROPERTY
that respondent had continuously failed and refused
to comply with the terms and conditions of the lease
contract concerning the payment of monthly rental.
May petitioner eject respondent from the subject
land?
A: Yes. For an unlawful detainer suit to prosper, the
plaintiff-lessor must show that: first, initially, the
defendant-lessee legally possessed the leased premises
by virtue of a subsisting lease contract; second, such
possession eventually became illegal, either due to the
latter's violation of the provisions of the said lease
contract or the termination thereof; third, the
defendant-lessee remained in possession of the leased
premises, thus, effectively depriving the plaintiff-lessor
enjoyment thereof; and fourth, there must be a demand
both to pay or to comply and vacate and that the suit is
brought within one (1) year from the last demand.[45]
In this case, all requisites have been indubitably
complied with, considering that at the time the suit was
instituted on June 21, 2011: (a) there was a subsisting
lease contract[46] between petitioner and respondent; (b)
, respondent was not updated in its monthly rental
payments, as there is no evidence of such payment for
the months of April, May, and even June 2011-- said
omission constitutes a violation of the lease contract on
the part of respondent; (c) respondent was still in
possession of the subject land; and (d) the case was filed
within one (1) year from petitioner's letter[47] dated May
24, 2011 demanding that respondent pay monthly
rentals and at the same time, vacate the subject land.
RECOVERY OF POSSESSION OF MOVABLE PROPERTY
Replevin
It is the remedy when the complaint prays for the
recovery of the possession of personal property.
NOTE: A property validly deposited in custodia legis
cannot be subject of a replevin suit (Calub v. CA, G.R. No.
115634, April 27, 2000).
RECOVERY OF POSSESSION OF IMMOVABLE
PROPERTY
Accion interdictal
It is a summary action to recover physical or material
possession only and it must be brought within one year
from the time the cause of action arises. It may be:
1. Forcible Entry; or
2. Unlawful detainer.
Q: PTGWO-ITF (petitioner) is a duly registered labor
organization engaged in an on-going Shelter Program,
which offers residential lots and fully-furnished houses
to its members-seafarers under a reimbursement
scheme requiring no down payment and no interest on
the principal sum advanced for the acquisition and
development of the land and the construction of the
house. Petitioner entered into a contract under the
Shelter Program with one of its members, Noriel Decena,
with the obligation to reimburse petitioner the full
amount thereof in 180 equal monthly payments. It was
stipulated in the contract that if the respondent fails to
pay 3 monthly reimbursements, he shall be given a 3-
month grace period to remit his arrears, otherwise the
contract will be cancelled. Subsequently, the respondent
failed to pay 25 monthly reimbursements, Hence the
petitioner cancelled the contract and treated it as rental
payments for his occupancy of the house and lot. And
thereafter file a case for unlawful detainer. What was the
contract entered into by the parties?
A: The contract entered into was a contract to sell. A
contract to sell is defined as a bilateral contract whereby
the prospective seller, while expressly reserving the
ownership of the subject property despite delivery
thereof to the prospective buyer, binds itself to sell the
said property exclusively to the prospective buyer upon
fulfillment of the condition agreed upon, that is, full
payment of the purchase price. The Shelter Contract
Award granted to respondent expressly stipulates that
"upon completion of payment of the full payment, the
UNION shall execute a Deed of Transfer and shall cause
the issuance of the corresponding Transfer Certificate of
Title in favor of and in the name of the AWARDEE." It
cannot be denied, therefore, that the parties herein
entered into a contract to sell in the guise of a
reimbursement scheme requiring respondent to make
monthly reimbursement payments which are, in
actuality, installment payments for the value of the
subject house and lot.
Accion publiciana
It refers to an ejectment suit filed within 10 years after
the expiration of one year from accrual of cause of action
or from the unlawful witholding of possession of the
realty (Gabriel Jr. v. Crisologo, G.R. No. 204626, June 9,
2014).
It is an ordinary civil proceeding to recover the better
right of possession, except in cases of forcible entry and
unlawful detainer. What is involved here is not
possession de facto but possession de jure.
Accion reinvindicatoria
It is an action to recover real property based on
ownership. Here, the object is the recovery of the
dominion over the property as owner.
NOTE: Where the facts averred in the complaint reveals
that the action is neither one of forcible entry nor
unlawful detainer but essentially involves a boundary
dispute, the same must be resolved in an accion
reinvindicatoria (Sarmiento v. CA, G.R. No. 116192,
November 16, 1995).
Requisites of accion reinvindicatoria
1. Identity of property; and
2. Plaintiff’s title to the property.
---
 PROPERTY
Q. Eliza Zuñiga-Santos, through her authorized
representative, Nympha Z. Sales, filed a Complaint or
annulment of sale and revocation of title against
respondents Maria Divina Gracia Santos-Gran and the
Register of Deeds of Marikina City before the RTC. The
said complaint was later amended. Petitioner alleged,
among others, that: (a) she was the registered owner of
three (3) parcels of land located in the Municipality of
Montalban, Province of Rizal, prior to their transfer in
the name of private respondent Gran; (b) she has a
second husband by the name of Lamberto C. Santos,
with whom she did not have any children; (c) she was
forced to take care of Lamberto’s alleged daughter, Gran,
whose birth certificate was forged to make it appear that
the latter was petitioner’s daughter; (d) pursuant to void
and voidable documents Sale, Lamberto succeeded in
transferring the subject properties in favor of and in the
name of Gran; (e) despite diligent efforts, said Deed of
Sale could not be located; and (f) she discovered that the
subject properties were transferred to Gran. Accordingly,
petitioner prayed, inter alia, that Gran surrender to her
the subject properties and pay damages, including costs
of suit. Gran filed a Motion to Dismiss, contending, inter
alia, that (a) the action filed by petitioner had prescribed
since an action upon a written contract must be brought
within ten (10) years from the time the cause of action
accrues, or in this case, from the time of registration of
the questioned documents before the Registry of Deeds;
and (b) the Amended Complaint failed to state a cause of
action as the void and voidable documents sought to be
nullified were not properly identified nor the substance
thereof set forth. Has the action for the reconveyance of
title already prescribed?
A. Yes. It is evident that petitioner ultimately seeks for the
reconveyance to her of the subject properties through the
nullification of their supposed sale to Gran. An action for
reconveyance is one that seeks to transfer property, wrongfully
registered by another, to its rightful and legal owner. Having
alleged the commission of fraud by Gran in the transfer and
registration of the subject properties in her name, there was, in
effect, an implied trust created by operation of law pursuant to
Article 1456 of the Civil Code which provides: Art. 1456. If
property is acquired through mistake or fraud, the person
obtaining it is, by force of law, considered a trustee of an
implied trust for the benefit of the person from whom the
property comes. To determine when the prescriptive period
commenced in an action for reconveyance, the plaintiff ’s
possession of the disputed property is material. If there is an
actual need to reconvey the property as when the plaintiff is
not in possession, the action for reconveyance based on
implied trust prescribes in ten (10) years, the reference point
being the date of registration of the deed or the issuance of
the title. On the other hand, if the real owner of the property
remains in possession of the property, the prescriptive period
to recover title and possession of the property does not run
against him and in such case, the action for reconveyance
would be in the nature of a suit for quieting of title which is
imprescriptible.
Q: Felisa Buenaventura, the mother of the Petitioner
Bella and respondents Resurreccion, Rhea and Regina,
owned a parcel of land with a three-storey building. In
1960, Felisa transferred the same to her daughter Bella,
married to Delfin, Sr., and Felimon, Sr., the common-
law husband of Felisa, to assist them in procuring a
loan from the GSIS. In view thereof, her title over the
property was cancelled and a new one was issued in
the names of Bella, married to Delfin, Sr., and
Felimon, Sr. Upon Felisa's death in 1994, the Bihis
Fami ly, Felisa's other heirs who have long been
occupyi ng the subject property, caused the
annotation of their adverse claim over the property.
However, the annotation was cancelled, and thereafter a
new TCT over the property was issued in the names of
Bella, et al. Finally, by virtue of a Deed of Sale dated
January 23, 1997, the subject property was sold to Wilson
and Peter, in whose names TCT No. 170475 currently
exists. A complaint for reconveyance was then filed. Was
there a trust established between Felisa and Bella,
Delfin,Sr., and Felimon, Sr.?
A: Yes. An express trust was created.
Trust is the right to the beneficial enjoyment of property, the
legal title to which is vested in another. It is a fiduciary
relationship that obliges the trustee to deal with the property
for the benefit of the beneficiary. Trust relations between
parties may either be express or implied. An express trust is
created by the intention of the trustor or of the parties, while
an implied trust comes into being by operation of law. Express
trusts are created by direct and positive acts of the parties, by
some writing or deed, or will, or by words either expressly or
impliedly evincing an intention to create a trust.
From the letter executed by Felisa, it unequivocally and
absolutely declared her intention of transferring the title over
the subject property to Bella, Delfin, Sr., and Felimon, Sr. in
order to merely accommodate them in securing a loan from
the GSIS. She likewise stated clearly that she was retaining her
ownership over the subject property and articulated her wish
to have her heirs share equally therein. Hence, while in the
beginning, an implied trust was merely created between Felisa,
as trustor, and Bella, Delfin, Sr., and Felimon, Sr., as both
trustees and beneficiaries, the execution of the September 21,
1970 letter settled, once and for all, the nature of the trust
established between them as an express one, their true
intention irrefutably extant thereon.
Q: A contract of lease executed by Alava (lessor) and
Anita Lao (lessee) was not registered with the
Register of Deeds. Aside from Anita, Rudy Lao also
leased a portion of the same property where he put
up his business. At that time, Rudy knew that Anita
and her husband were the owners of the said
building. He also knew that she had leased that
portion of the property, and that Jaime Lao, their
son, managed and maintained the building, as well as
the business thereon. Rudy eventually purchased the
entire property from Alava. Rudy then filed a
complaint for unlawful detainer against Jaime
alleging that the latter had occupied a portion of his
property without any lease agreement and without
paying any rentals, and prayed that an order be
rendered directing Jaime to vacate the premises.
Should the complaint be dismissed?
 PROPERTY
A: YES. The records in this case show that the c)Strategy; NOTE: The question of
respondent has been in possession of the property in d)Threat; or possession is primordial,
question, not by mere tolerance or generosity of Rudy, e)Stealth. while the issue of
but as the manager of his mother, who conducted her ownership is generally
business in the building which stood on a portion of the unessential in unlawful
property leased from Alava. Jaime’s possession was in detainer (Rosa Rica Sales
behalf of his mother, and not in his own right (Lao v. Lao, Center v. Sps. Ong, G.R.
G.R. No. 149599, May 16, 2005). 132197, August 16, 2005).
---
As to necessity of demand
Effect of non-registration of the contract of lease
No previous demand for Demand is jurisdictional if
Although the lease contract was not filed with the the defendant to vacate is the ground is non-payment
Register of Deeds, nevertheless, the buyer of the necessary. of rentals or failure to
property was bound by the terms and conditions of said comply with the lease
contract. The lease, in effect became a part of the contract.
contract of sale. He had no cause of action for unlawful
detainer against the lessee because of the subsisting As to necessity of proof of prior physical possession
contract of lease; hence, he could not file the complaint Plaintiff must prove that he Plaintiff need not have
against her (Lao v. Lao, G.R. No. 149599, May 16, 2005). was in prior physical been in prior physical
--- possession of the premises possession.
Q: Spouses Magtanggol managed and operated a until he was deprived
gasoline station on a 1,000 sq.m. lot which they thereof by the defendant.
leased from Francisco Bigla-awa. The contract was NOTE: The fact that
for a period of three years. When the contract petitioners are in
expired, Francisco asked the spouses to peacefully possession of the lot does
vacate the premises. The spouses ignored the not automatically entitle
demand and continued with the operation of the them to remain in
gasoline station. possession (Ganilla v. CA,
G.R. No. 150755, June 28,
One month after, Francisco, with the aid of a group of 2005).
armed men, caused the closure of the gasoline As to when one year period is counted from
station by constructing fences around it.
One year period is One year period is counted
generally counted from the from the date of last
Was the act of Francisco and his men lawful? Why?
date of actual entry of the demand or last letter of
(2014 Bar)
land. demand.
A: NO, the act was not lawful. Even if the lessee’s right to
occupy the premises has expired, the lessor cannot REQUISITES FOR RECOVERY OF PROPERTY
physically oust the lessee from the leased premises if the
latter refuses to vacate. The lessor must go through the 1. Clearly identify the land he is claiming in
proper channels by filing an appropriate case for accordance with the title/s on which he bases
unlawful detainer or recovery of possession. Every his right of ownership; and
possessor has a right to be respected in his possession
(NCC, Art. 539) and in no case can possession be acquired NOTE: Burden of proof lies on the party who
through force or intimidation as long as there is a asserts the affirmative of an issue. The
possessor who objects thereto (NCC, Art. 536). The act of description should be so definite that an officer
Francisco is an abuse of rights because even if he has the of the court might go to the locality where the
right to recover possession of his property, he must act land is situated and definitely locate it.
with justice and give the lessees their day in court and
observe honesty and good faith. 2. Prove that he has a better title than the
--- defendant.
a. Best proof is a Torrens certificate; and
DISTINCTION BETWEEN FORCIBLE ENTRY AND b. Tax receipts, tax declarations are only
UNLAWFUL DETAINER prima facie evidence of ownership; it is
rebuttable.
Forcible Entry Unlawful Detainer
As to when possession became unlawful NOTE: Plaintiff’s title must be founded on positive
right or title and not merely on the lack or
Possession of the defendant Possession is inceptively
inefficiency of the defendant’s title. In other words,
is unlawful from the lawful but becomes illegal
he shall not be permitted to rely upon the defects of
beginning as he acquired from the time defendant
the defendant’s title (NCC, Art. 434).
possession by; (FISTS) unlawfully withholds
---
possession after the
Q: Josephine filed an Application for Registration of
a)Force; expiration or termination
Title by virtue of a Deed of Absolute Sale. She
b)Intimidation ; of his right thereto.
claimed the benefits of Chapter VIII of
 PROPERTY
Commonwealth Act No. 141 (1936), because she and Generally corporeal or Incorporeal or intangible.
her predecessor-in-interest have been in open, tangible. Object is specific Object covers all the
continuous, public, peaceful and adverse possession property or thing. present and future
of the land since time immemorial. The OSG, on the property of the debtor
other hand, averred that the muniments of title and (NCC, Art. 2236).
tax payment receipts submitted by Josephine do not
constitute competent or sufficient evidence of a bona Subjects
fide acquisition of the subject lot, or of the a. One definite active a. An active subject
petitioner’s open, continuous, exclusive and subject (e.g. owner) (creditor); and
notorious possession and occupation thereof in the b. One indefinite passive b. A definite passive
concept of owner since June 12, 1945 or prior subject which is the subject (debtor).
thereto. Can the application of Josephine be whole world
approved? Right of pursuit is
therefore available.
A: NO. In land registration cases, the applicant has the Real right follows its
burden to show that he or she is the real and absolute object in the hands of
owner in fee simple of the land sought to be registered. It any possessor.
is also important to bear in mind that one who seeks
registration of title must prove his or her claim with Enforceability
well-nigh incontrovertible evidence. In any event, in the
absence of other competent evidence, tax declarations do Enforceable only against
Enforceable against the
not conclusively establish either possession or declarant’s the original debtor or his
whole world.
right to registration of title. In this case, petitioner transferee charged with
miserably failed to show that she is the real and absolute notice of the personal
owner in fee simple of the land sought to be registered rights
(Josephine Wee v. Republic of the Philippines, G.R. No.
177384, December 8, 2009) (Del Castillo, J.) Limit
---
No such limitation.
Reasons why the plaintiff is NOT allowed to rely on Limited by usefulness,
the weakness of defendant’s title value or productivity of the
thing.
1. Possibility that neither the plaintiff nor the
defendant is the true owner of the property. In Extinguishment
which case, the defendant who is in possession will
be preferred; Not so extinguished.
Extinguished by loss or
2. One in possession is presumed to be the owner and Claim for damages may
destruction of the thing
he cannot be obliged to show or prove a better title; still be pursued-in case of
3. Possessor in the concept of an owner is presumed to loss or destruction of the
be in good faith and he cannot be expected to be thing.
carrying every now and then his proofs of
ownership over the property; and
4. He who relies on the existence of a fact, should LIMITATIONS ON THE RIGHT OF OWNERSHIP
prove that fact. If he cannot prove, the defendant
does not have to prove. Those imposed by the: (SLOG-C2-SO)

1. State in the exercise of:

2.
REAL v. PERSONAL RIGHTS
3.
Real Right (Right of Personal Right (Right to
possession; possessionis) possess; possidendi)
Creation
Created by both title and Created by title alone. 4.
mode directly over a thing.
It is not directly created
over a thing but is
exercised through
another against whom the 5.
action is to be brought.
6.
Object
a. Power of taxation;
b. Police power; and
c. Power of eminent domain.
Law;
a. Legal easements (i.e., easements of waters and
of right of way) and
b. The requirement of legitime in succession;
Owner himself;
a. Voluntary easement
b. Mortgage
c. Pledge
d. Lease;
Grantor of the property on the grantee, either by:
a. Contract
b. Donation or
c. Will;
Those arising from Conflicts of private rights - Those
which take place in accession continua;
Constitution - On the prohibition against the
acquisition of private lands by aliens;
 PROPERTY
7. Acts in state of necessity – The law permits injury or
destruction of things owned by another provided
this is necessary to avert a greater danger (with
right to indemnity v. principle of unjust
enrichment); and
8. True owner must resort to judicial process – When
thing is in possession of another; law creates a
disputable presumption of ownership to those in
actual possession. (2008 Bar).
Art. 429. The owner of lawful possessor of a thing
has the right to exclude any person from yhe
enjoyment and disposal thereof. For this purpose,
he may jse such force as may be reasonably
necessary to repel or prevent an actual or
threatened unlawful physical invasion of
usurpation of his property
PRINCIPLE OF SELF-HELP
This principle authorizes an owner or lawful possessor
of a property to use reasonable force to prevent or repel
an actual or threatened unlawful physical invasion or
usurpation of property (NCC, Art. 429). There must be no
delay in the pursuit, otherwise, his recourse will be to go
to the court for the recovery of property.
Requisites of the Principle of Self-Help
(RODA)
1. Reasonable force used
2. Such force is used by the owner or lawful
possessor
3. There is no delay
4. Actual or threatened physical invasion or
usurpation of the property.
Right of self-help exercised by third person
A third person who is not a possessor may repel
unlawful possession on the property owned by another.
In such an event, he is acting as a negotorium gestor. The
owner must indemnify him for injuries sustained
(Pineda, 2009).
Test of reasonableness
The reasonableness of the defensive acts resorted to by a
possessor is determined not by what he imagined to
exist but by the objective situation (Pineda, 2009).
German Management's drastic action of bulldozing and
destroying the crops of private respondents on the basis
of the doctrine of self-help was 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 (German Mgmt. Services Inc. v. CA, G.R. No.
76216, September 14, 1989).
NOTE: The intruder must not have succeeded in its
entry, for otherwise, he must resort to court action; self-
help cannot apply. One cannot put the law into his own
hands. Art. 429 must be read in relation to Art. 536.
“Sic utere tuo ut alienum non laedas”
The owner of a thing cannot make use thereof in such
manner as to injure the rights of a third person (NCC, Art.
431).
Property owner can use his property in any manner he
desires provided he does not injure the rights of others
sic utere tuo ut alienum non laedas (Pineda, 2009).
Art. 430. Every 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.
Limitation on the right of the owner to enclose or
fence one’s land or tenement
Every owner may enclose or fence his land or tenement
by means of walls, ditches, live or dead hedges or by any
other means provided that in so fencing the property, no
servitude or easement constituted thereon should be
impaired (Pineda, 2009).
DOCTRINE OF STATE OF NECESSITY
The owner of a thing has no right to prohibit the
interference of another with the same, if the interference
is necessary to avert an imminent danger and the
threatened damage, compared to the damage arising to
the owner from the interference, is much greater. The
owner may demand from the person benefited
indemnity for the damage to him (NCC, Art. 432).
This principle authorized the destruction of property
which is lesser in value to avert the danger poised to
another property of greater value.
Requisites of Doctrine of State of Necessity
1. Interference necessary to avert an imminent
danger and the threatened damage to the actor
or a third person;
2. Damage to another is much greater than the
damage to the property.
Art. 433. Actual possession under claim of
ownership raises a disputable presumption of
ownership. The true owner must resort to judicial
process for the recovery of the property.
Disputable presumption of ownership
There is disputable presumption of ownership when a
person is in actual possession of the property under the
claim of ownership (Pineda, 2009).
Resort of the owner rebutting the presumption
Under Art. 433 the remedy is judicial process to recover
the property of the person.
Requisites to prove claim of ownership
 PROPERTY
1. Proper identification of the property; and
2. Title must be clear, strong and credible (Pineda,
2009).
Art. 434. In an action to recover, the property must
be identified, and the plaintiff must rely on the
strength of his title and not on the weakness of the
defendant’s claim.
Requisites For Action To Recover Property
1. To clearly identify the land he is claiming in
accordance with the title or titles on which he bases
his right of ownership; and,
3. To prove that he has a better title than the
defendant (Pineda, 2009).
Art. 435. No person shall be deprived of his
property except by competent authority and for
public use and always upon payment of just
compensation
Should this requirement be not first complied with,
the courts shall protect and, in a proper case,
restore the owner in his possession.
Emminent Domain
This is the superior right of the State to acquire private
property whether registered or not for public use upon
payment of just compensation.
It is one of the limitations on the right of ownership in
the pursuit of public interest. (Pineda, 2009)
Elements of “Taking” Of Property For Purposes Of
Eminent Domain
1. The expropriator must enter a private property;
2. The entrance into private property must be for more
than a momentary period;
3. The entry into the property should be under warrant
or color of legal authority
4. The property must be devoted to a public use or
otherwise informally appropriated or injuriously
affected; and,
5. The utilization of the property for public use must be
in such a way as to oust the owner and deprive him of all
beneficial enjoyment of the property (National Power
Corporation vs. Court of Appeals, 254 SCRA 577)
Q: Alfredo Hababag, Sr. (Alfredo) was the owner of
several parcels of agricultural land situated in the
Municipality of Gubat, Sorsogon. The aforesaid
landholdings were voluntarily offered for sale (VOS)
to the government under Republic Act No. (RA) 6657,
otherwise known as the "Comprehensive Agrarian
Reform Law of 1988,". The Land Bank of the
Philippines (LBP) initially valued the subject lands at
P1,237,850.00, but Alfredo rejected the valuation.
After summary administrative proceedings for the
determination of the amount of just compensation,
the Office of the Provincial Agrarian Reform
Adjudicator (PARAD) of the Department of Agrarian
Reform (DAR) Adjudication Board (DARAB) fixed the
value of the subject lands at
P1,292,553.20. Dissatisfied, Alfredo filed a Complaint
for the determination of the amount of just
compensation before the RTC. RTC rendered a
Decision fixing the amount of just compensation of
the subject lands at P5,653,940.00. RTC applied the
Income Productivity Approach. CA set aside the
RTC's valuation for failure to give due consideration
to the factors enumerated in Section 17 of RA 6657
and the formula under DAR AO 6-92, as amended by
DAR AO 11-94. Moreover, contrary to the limitation
imposed by DAR AO 6-92 - i.e., that the computed
value using the applicable formula shall not exceed
the landowner's offer to sell - the CA found that the
amount as recomputed by the RTC was way beyond
the landowner's offer of P1,750,000.00 as stated in
the Claims Valuation and Processing Form. Is the CA
correct in setting aside the computation of RTC?
A: Yes. Just compensation is defined as the full and fair
equivalent of the property taken from its owner by the
expropriator. It has been repeatedly -stressed by this
Court that the measure is not the taker's gain but the
owner's loss. The word "just" is used to intensify the
meaning of the word "compensation" to convey the idea
that the equivalent to be rendered for the property to be
taken shall be real, substantial, full [and] ample.
In this relation, the RTC, sitting as a Special Agrarian
Court, has been conferred with the original and exclusive
power to determine just compensation for parcels of
land acquired by the State pursuant to the agrarian
reform program. To guide the RTC in this function,
Section 17 of RA 6657 enumerates the factors which
must be taken into consideration to accurately
determine the amount of just compensation to be
awarded in a particular case. They are: (a) the
acquisition cost of the land; (b) the current value of like
properties; (c) the nature and actual use of the property,
and the income therefrom; (d) the owner's sworn
valuation; (e) the tax declarations; (f) the assessment
made by government assessors; (g) the social and
economic benefits contributed by the farmers and the
farmworkers, and by the government to the property;
and (h) the nonpayment of taxes or loans secured from
any government financing institution on the said land, if
any. Corollarily, pursuant to its rule-making power under
Section 49 of the same law, the DAR translated these
factors into a basic formula, which courts have often
referred to and applied, as the CA did in this case. It,
however, bears stressing that courts are not constrained
to adopt the said formula in every case since the
determination of the amount of just compensation
essentially partakes the nature of a judicial function. In
this accord, courts may either adopt the DAR formula or
proceed with its own application for as long as the
factors listed in Section 17 of RA 6657 have been duly
considered.
In keeping with these considerations, the Court finds the
CA's valuation - which made use of the DAR formula - as
reflective of the factors set forth in Section 17 of RA
6657. Records disclose that the CA's computation, as
 PROPERTY
adopted from the LBP's own computation, is based on:
(a) actual production data; (b) the appropriate industry
selling prices of the products from the Philippine
Coconut Authority and the Bureau of Agricultural
Statistics of Sorsogon; and (c) the actual uses of the
property. Likewise, the (a) income from the coconut
fruit-bearing trees, as well as the unirrigated riceland,
(b) cumulative cost of the non-fruit-bearing trees; and
(c) market value of the cogonal land have been duly
considered. The Court observes that the holistic data
gathered therefrom adequately consider the factors set
forth in Section 17 of RA 6657, as well as the DAR
formula. As such, the CA's computation, which was
derived from the same, must be sustained. Lest it be
misunderstood, the ascertainment of just compensation
on the basis of the landholdings' nature, location, and
market value, as well as the volume and value of the
produce is valid and accords with Section 17 of RA
6657 and the DAR formula, as in this case.
On the contrary, the Court finds the RTC's valuation to be
improper, as it contradicts the definition of "market
value" as crafted by established jurisprudence on
expropriation.
Q: The Republic of the Philippines filed before the
RTC a complaint against an unknown owner for the
expropriation of a lot located in Barangay Ugong,
Valenzuela City for the construction of the C-5
Northern Link Road Project, otherwise known as
North Luzon Expressway (NLEX) Segment 8.1,
traversing from Mindanao Avenue in Quezon City to
the NLEX in Valenzuela City. Petitioner applied for a
writ of possession over the subject lot on May 5,
2008, which was granted, and was required to
deposit with the court the amount of P550,000.00
(i.e., at P2,750.00/sq. m.) as provisional deposit.
However, respondent Macabagdal was substituted as
party-defendant upon sufficient showing that the
subject lot is registered in her name under the
Transfer Certificate Title of the lot. Respondent did
not oppose the expropriation, and received the
provisional deposit. The RTC appointed a board of
commissioners to determine the just compensation
for the subject lot, which thereafter submitted report
dated May 23, 2014, recommending a fair market
value of P9,000.00/sq. m. as the just compensation
for the subject lot, taking into consideration its
location, neighborhood and land classification,
utilities, amenities, physical characteristics,
occupancy and usage, highest and best usage,
current market value offerings, as well as previously
decided expropriation cases of the same RTC
involving properties similarly situated in the same
barangay. The Court of Appeals affirmed this
decision, which brought up the that the CA did not
rule on the issue of the applicable rate of interest
which, in this case, should be at twelve percent
(12%) per annum. from the filing of the complaint
until June 30, 2013, and thereafter, at six percent
(6%) per annum until full payment. Is the 12% per
annum interest on the unpaid balance, computed
from the time of the taking of the subject lot until full
payment, valid?
A: No. The value of the landholdings should be
equivalent to the principal sum of the just compensation
due, and interest is due and should be paid to
compensate for the unpaid balance of this principal sum
after taking has been completed. From the date of the
taking of the subject lot on May 5, 2008 when the RTC
issued a writ of possession in favor of petitioner, until
the just compensation therefor was finally fixed at
P9,000.00/sq. m., petitioner had only paid a provisional
deposit in the amount of P550,000.00 (i.e., at
P2,750.00/sq. m.). Thus, this left an unpaid balance of
the "principal sum of the just compensation," warranting
the imposition of interest. It is settled that the delay in
the payment of just compensation amounts to an
effective forbearance of money, entitling the landowner
to interest on the difference in the amount between the
final amount as adjudged by the court and the initial
payment made by the government. It bears to clarify that
legal interest shall run not from the date of the filing of
the complaint but from the date of the issuance of the
Writ of Possession on May 5, 2008, since it is from this
date that the fact of the deprivation of property can be
established. As such, it is only proper that accrual of legal
interest should begin from this date.
Q: On February 12, 2013, DPWH, led before the RTC a
complaint against respondent Belly, seeking to
expropriate the lots registered in the name of
respondent under Transfer Certificate of Title (TCT)
Nos. V-92188 8 and V-92191 9 with a total area of
1,671 sq. m. (subject lots), together with the
improvements thereon with an aggregate surface
area of 2,121.7 sq. m. (collectively, subject
properties), located in Kowloon Industrial
Compound, Tatalon Street, Brgy. Ugong, Valenzuela
City, for the construction of the Mindanao Avenue
Extension Project, Stage II-C (Valenzuela City to
Caloocan City). DPWH manifested that it is able and
ready to pay Belly the amounts of P6,684,000.00 (i.e.,
at P4,000.00/sq. m.) and P11,138,362.74,
representing the combined relevant zonal value of
the subject lots and the replacement cost of the
improvements thereon, respectively.
In her answer, Belly contended that the offer price is
unreasonably low, and that she should be
compensated the fair market value of her properties
at the time of taking, estimated to be at
P25,000.00/sq. m. Moreover, the fair and just
replacement cost of the improvements on the subject
lots should be in the amount of P22,276,724.00,
pursuant to Section 10 of the Implementing Rules
and Regulations of Republic Act No. (RA) 8974.
DPWH was eventually granted a Writ of Possession,
after Belly received the amount of P17,822,362.74,
representing 100% of the zonal value of the subject
properties.
The RTC appointed a board of commissioners to
determine the just compensation for the properties
which, thereafter, submitted its Commissioner's
Report dated June 10, 2013, recommending the
amounts of P7,000.00/sq. m. and P12,000.00/sq. m.
as the just compensation for the subject lots and the
 PROPERTY
improvements thereon, respectively, and the
payment of six percent (6%) legal interest therefor,
reckoned from the time of taking.
A: No. The construction of the Mindanao Avenue
Extension Project, Stage II-C (Valenzuela City to Caloocan
City) involves the implementation of a national
infrastructure project. Thus, for purposes of determining
the just compensation, RA 8974 and its implementing
rules and regulations (IRR), which were effective at the
time of the filing of the complaint, shall govern
The replacement cost method is premised on the
principle of substitution, which means that "all things
being equal, a rational, informed purchaser would pay no
more for a property than the cost of building an
acceptable substitute with like utility."
The case of Republic v. Mupas (Mupas) instructs that in
using the replacement cost method to ascertain the value
of improvements, the courts may also consider the
relevant standards provided under Section 5 of RA 8974,
as well as equity consistent with the principle that
eminent domain is a concept of equity and fairness that
attempts to make the landowner whole. Thus, it is not
the amount of the owner's investment, but the "value of
the interest" in land taken by eminent domain, that is
guaranteed to the owner.
While there are various methods of appraising a
property using the cost approach, Mupas declared that
the use of the depreciated replacement cost method is
consistent with the principle that the property owner
shall be compensated for his actual loss, bearing in mind
that the concept of just compensation does not imply
fairness to the property owner alone, but must likewise
be just to the public which ultimately bears the cost of
expropriation. The property owner is entitled to
compensation only for what he actually loses, and what
he loses is only the actual value of the property at the
time of the taking. Hence, even as undervaluation would
deprive the owner of his property without due process,
so too would its overvaluation unduly favor him to the
prejudice of the public.
It must be emphasized that in determining just
compensation, the courts must consider and apply the
parameters set by the law and its implementing rules
and regulations in order to ensure that they do not
arbitrarily fix an amount as just compensation that is
contradictory to the objectives of the law. Be that as it
may, when acting within the parameters set by the law
itself, courts are not strictly bound to apply the formula
to its minutest detail, particularly when faced with
situations that do not warrant the formula's strict
application. Thus, the courts may, in the exercise of their
discretion, relax the formula's application, subject to the
jurisprudential limitation that the factual situation calls
for it and the courts clearly explain the reason for such
deviation.
In this case, the RTC and the CA upheld the
recommendation of the court-appointed commissioners,
fixing the just compensation for the improvements on
the expropriated properties at P12,000.00/sq. m., which
merely considered their location, classification, value
declared by the owner, and the zonal valuation of the
subject lots. However, there is no competent evidence
showing that it took into account the prevailing
construction costs and all other attendant costs
associated with the acquisition and installation of an
acceptable substitute in place of the affected
improvements/structures as required by the IRR.
Consequently, the Court cannot uphold and must,
perforce, set aside the said valuation as the just
compensation for the subject improvements.
In relation thereto, the Court deems it proper to correct
the award of legal interest to be imposed on the unpaid
balance of the just compensation, which shall be
computed at the rate of twelve percent (12%) p.a. from
the date of taking, i.e., from April 10, 2013 when the RTC
issued a writ of possession in favor of petitioner, until
June 30, 2013. Thereafter, or beginning July 1, 2013, until
fully paid, the just compensation due respondent shall
earn interest at the rate of six percent (6%) p.a., in line
with the amendment introduced by BSP-MB Circular No.
799, Series of 2013.
Q: The Republic of the Philippines filed before the RTC
a complaint against an unknown owner for the
expropriation of a lot located in Barangay Ugong,
Valenzuela City for the construction of the C-5 Northern
Link Road Project, otherwise known as North Luzon
Expressway (NLEX) Segment 8.1, traversing from
Mindanao Avenue in Quezon City to the NLEX in
Valenzuela City. Petitioner applied for a writ of
possession over the subject lot on May 5, 2008, which was
granted, and was required to deposit with the court the
amount of P550,000.00 (i.e., at P2,750.00/sq. m.) as
provisional deposit. However, respondent Macabagdal
was substituted as party-defendant upon sufficient
showing that the subject lot is registered in her name
under the Transfer Certificate Title of the lot.
Respondent did not oppose the expropriation, and
received the provisional deposit. The RTC appointed a
board of commissioners to determine the just
compensation for the subject lot, which thereafter
submitted report dated May 23, 2014, recommending a
fair market value of P9,000.00/sq. m. as the just
compensation for the subject lot, taking into
consideration its location, neighborhood and land
classification, utilities, amenities, physical
characteristics, occupancy and usage, highest and best
usage, current market value offerings, as well as
previously decided expropriation cases of the same RTC
involving properties similarly situated in the same
barangay. The Court of Appeals affirmed this decision,
which brought up the that the CA did not rule on the
issue of the applicable rate of interest which, in this case,
should be at twelve percent (12%) per annum. from the
filing of the complaint until June 30, 2013, and thereafter,
at six percent (6%) per annum until full payment. Is the
12% per annum interest on the unpaid balance, computed
from the time of the taking of the subject lot until full
payment, valid?
A: No. The value of the landholdings should be equivalent to
the principal sum of the just compensation due, and interest is
due and should be paid to compensate for the unpaid balance
of this principal sum after taking has been completed. From
the date of the taking of the subject lot on May 5, 2008 when
 PROPERTY
the RTC issued a writ of possession in favor of petitioner, until
the just compensation therefor was finally fixed at
P9,000.00/sq. m., petitioner had only paid a provisional
deposit in the amount of P550,000.00 (i.e., at P2,750.00/sq.
m.). Thus, this left an unpaid balance of the "principal sum of
the just compensation," warranting the imposition of interest.
It is settled that the delay in the payment of just compensation
amounts to an effective forbearance of money, entitling the
landowner to interest on the difference in the amount between
the final amount as adjudged by the court and the initial
payment made by the government. It bears to clarify that legal
interest shall run not from the date of the filing of the
complaint but from the date of the issuance of the Writ of
Possession on May 5, 2008, since it is from this date that the
fact of the deprivation of property can be established. As such,
it is only proper that accrual of legal interest should begin
from this date.
Art. 436. When any property is condemned or
seized by competent authority in the interest of
health, safety or security, the owner thereof shall
not be entitled to compensation, unless he can
show that such condemnation or seizure is
unjustified.
Extent of ownership of parcel of land
The owner of a parcel of land is the owner of its surface
and of everything under it, and he can construct thereon
any works or make any plantations and excavations
which he may deem proper, without detriment to
servitudes and subject to special laws and ordinances.
He cannot complain of the reasonable requirements of
aerial navigation (NCC, Art. 437).
AD COLEUM
The owner of a land has rights not only to its surface but
also to everything underneath and the airspace above it
up to a reasonable height.
Presumably, the landowners’ right extends to such
height or depth where it is possible for them to obtain
some benefit or enjoyment, and it is extinguished beyond
such limit as there would be no more interest protected
by law (Napocor v. Ibrahim, G.R. No. 168732, June 29,
2007).
Art. 438. Hidden treasure belongs to the owner of
the land, building, or other property on which it is
found.
Nevertheless, when the discovery is made on the
property of another, or of the State or any of its
subdivisions, and by chance, one-half thereof shall
be allowed to the finder. If the finder is a
trespasser, he shall not be entitled to any share of
the treasure.
If the things found be of interest to science or the
arts, the State may acquire them at their just price,
which shall be divided in conformity with the rule
stated.
Art. 439. By treasure is understood, for legal
purposes, any hidden and unknown deposit of
money, jewelry or other precious objects, the
lawful ownership of which does not appear.
HIDDEN TREASURE
Treasure is understood, for legal purposes, as any hidden
and unknown deposit of money, jewelry, or other
precious objects, the lawful ownership of which does not
appear (NCC, Art. 439) (1997, 2008, 2014 Bar).
“Other precious objects”
Under the ejusdem generis rule, the phrase should be
understood as being similar to money or jewelry.
Oil or gold NOT considered as hidden treasure
These are natural resources. The Regalian Doctrine
applies and not the provisions on hidden treasure.
Rule regarding discovery of hidden treasure (NCC,
Art. 438 in relation to Art. 718)
GR: If the finder is the owner of the land, building, or
other property where it is found, the entire hidden
treasure belongs to him.
XPN: If the finder is not the owner or is a stranger
(includes the lessee or usufructuary, he is entitled to ½
thereof (NCC, Art. 566).
If the finder is married
If the finder is married, he or she gets one half of the
treasure or its value. His or her spouse is entitled to
share one-half of that share, it being a conjugal property
(NCC, Art. 117, par. 4, FC).
Requisites in order that the finder be entitled to any
share in the hidden treasure (ACTA)
1. Discovery was made on the property of Another, or
of the State or any of its political subdivisions;
2. Made by Chance; and
3. He is not a Trespasser or Agent of the landowner
(NCC, Art. 438, par. 2).
NOTE: If the things found be of interest to science or the
arts, the State may acquire them at their just price, which
shall be divided in conformity with the rule stated (NCC,
Art. 438).
“By chance”
The finder had no intention to search for the treasure.
There is no agreement between the owner of the
property and the finder for the search of the treasure.
Yamashita treasure
The State is entitled to 75% share and the finder to 25%
(PD 7056-A).
 PROPERTY
The finder is not entitled to the hidden treasure if it
was deliberately searched. (1976 Bar)
It was not found by chance (NCC, Art. 438). Moreover,
treasure is defined as hidden and unknown deposit of
precious objects, the lawful ownership of which does not
appear. There being a tip, the deposit is known (NCC, Art.
439).
Nature and ownership of the old notes and coins
The ownership of the vault, together with the notes and
coins can now legally be considered as hidden treasure
because its ownership is no longer apparent. The
contractor is not a trespasser and therefore entitled to
one-half of the hidden treasure and the owner of the
property is entitled the other half (NCC, Art. 438). Since
the notes and coins have historical value, the
government may acquire them at their just price which
in turn will be divided equally between them (NCC, Art.
438, par. 3). The vault has been buried for about a
century and the successor of the bank which previously
owned it cannot succeed by inheritance to the property.
(2008 Bar)
NOTE: Bills and notes found are not hidden treasures.
The owner can be traced through the serial numbers.
Q: O, owner of Lot A, learning that Japanese soldiers
may have buried gold and other treasures at the
adjoining vacant Lot B, belonging to Spouses X and Y,
excavated in Lot B where she succeeded in
unearthing gold and precious stones. How will the
treasures found by O to be divided – (1) 100% to O as
finder, (2) 50% to O and 50% to X and Y, (3) 50% to
O and 50% to the State (4) none of the above? (2010
Bar)
A: NONE OF THE ABOVE. The finding of the treasure
was not by chance because O knew that the treasure was
in Lot B. While a trespasser is also not entitled to any
share and there is no indication in the problem whether
or not O was a trespasser, O is not entitled to share
because the finding was not by chance.
ACCESSION
The right pertaining to the owner of a thing over
everything which is produced thereby, or which is
incorporated or attached thereto, either naturally or
artificially (NCC, Art. 440).
Right of accession
It is that right of ownership of which an owner of a thing
has over the products of said thing (accession discreta),
as well as to all things inseparably attached or
incorporated thereto whether naturally or artificially
(accession continua) (Pineda, 2009).
Accession is NOT a mode of acquiring ownership
It is not one of the modes enumerated under Art. 712
(different modes of acquiring ownership). It is, therefore,
safe to conclude that accession is not a mode of acquiring
ownership.
Reason: Accession presupposes a previously existing
ownership by the owner over the principal.
Fundamentally, accession is a right implicitly included in
ownership, without which it will have no basis or
existence (Paras, 2008).
NOTE: In general, the right to accession is automatic
(ipso jure), requiring no prior act on the part of the
owner or principal.
Art. 441. To the owner belongs:
(1) The natural fruits;
(2) The industrial fruits;
(3) The civil fruits.
ACCESSION DISCRETA
The right of accession with respect to what is produced
by the property.
To the owner belongs the:
1. Natural fruits - The spontaneous products of
the soil, and the young and other products of
animals;
2. Industrial fruits - Are those produced by lands
of any kind through cultivation or labor;
3. Civil fruits - The rents of buildings, the price of
leases of lands and other property and the
amount of perpetual or life annuities or other
similar income (NCC, Art. 441-442).
Obligation of the owner who receives the fruit from a
third person
He who receives the fruits has the obligation to pay the
expenses made by a third person in their production,
gathering and preservation (NCC, Art. 443) (2009 Bar).
Meaning of third person
One who is NOT the owner, builder, planter or sower.
NOTE: Only such as are manifest or born are considered
as natural or industrial fruits.
Art. 444. Only such as are manifest or born are
considered as natural or industrial fruits.
Which respect to animals, it is sufficient that they
are in the womb of the mother, although unborn.
With respect to animals, it is sufficient that they are in
the womb of the mother, although unborn (NCC, Art.
444).
Existence of the fruit
It depends on the type of fruit:
 PROPERTY
1. Annual (must be planted every year/must re-
plant after harvest; rice, wheat, corn) – deemed
manifest the moment their seedlings appear; GENERAL RULLES OF ACCESSION
and
2. Perennial (only planted once and bear fruit for Accession exists only if separation is not feasible.
several seasons; mango and coconut trees) – Otherwise, separation may be demanded.
deemed to exist only when they actually
appear. ACCESSION CONTINUA

Animal young It is the right pertaining to the owner of a thing over

everything incorporated or attached thereto either
They are considered existing even if still in the maternal naturally or artificially; by external forces.
womb. They should be considered existing only at the
commencement of the maximum ordinary period for 1. Immovable roperty Property
gestation. a. Accession industrial (Art. 445-455)
i. Building;
Pratus sequitor ventrem – offspring follows the ii. Planting; and
mother iii. Sowing.
b. Accession natural
This legal maxim means that the offspring follows the i. Alluvium; (Art. 457)
dam (mother). The legal presumption, in the absence of ii. Avulsion; ( Art. 459)
proof to the contrary, is that the calf, as well as its iii. Change of course of rivers; and (Art.
mother belongs to the owner of the latter, by the right of 461-462)
accretion (US v. Caballero, G.R. No. 8608, September 26, iv. Formation of islands. (Art. 464-465)
1913). Thus, when the ownership over the offspring of 2. Movable property
the animal when the male and female belongs to a. Adjunction or Conjunction;
different owners, the owner of the female was b. Mixture; and
considered also the owner of the young, unless there is a c. Specification.
contrary custom or speculation. Basic principles in accession continua (BADONG-E)

Art. 445. 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,
subject to the provisions of the following articles.
When fruits are deemed to exist
1. Civil fruits accrue daily and are considered
personal property and may be pro-rated; and
2. Natural and industrial fruits, while still
growing, are considered as real property;
ordinarily, they cannot be pro-rated.
Art. 446. All works, sowing, and planting are
presumed made by the owner and at his expense,
unless the contrary is proved.
1. He who is in Bad faith is liable for damages.
2. Accessory follows the principal;
3. Union or incorporation must generally be
effected in such a manner that to separate the
principal from the accessory would result in
substantial Damage to either or diminish its
value;
4. To the Owner of the thing belongs the
extension or increases to such thing;
5. Bad faith of one party Neutralizes the bad faith
of the other so that they shall be considered in
good faith;
6. He who is in Good faith may be held
responsible but not penalized; and
7. No one shall unjustly Enrich himself at the
expense of another.

Ownership of fruits
GR: Fruits belong to the owner (NCC, Art. 441).
XPNS: If the thing is: (PULPA)
1. In possession of a Possessor in good faith (NCC,
Art 546) (1992, 1996, 2000 Bar); before the
possession is legally interrupted;
2. Subject to a Usufruct (NCC, Art. 566);
3. Lease of rural land;
4. Pledged [NCC, Art. 1680 and Art. 2102(7)];
pledge is entitled to the fruits but has the
obligation to compensate or set-off what he
receives with those which are owing to him; or
5. In possession of an Antichretic creditor (NCC,
Art. 2132).
FOR IMMOVABLES
ACCESSION INDUSTRIAL
Three kinds of industrial endeavors (BPS)
1. Building – Erecting a structure or construction
of any kind, with roof for residential, office,
social, commercial or other purposes;
2. Planting – Setting into the soil or land seeds or
seedlings of trees such as mangoes, coconuts,
etc;
3. Sowing – The act of scattering or spreading of
germinated seeds indiscriminately or evenly
through hand or mechanical device.
Maxims in connection with accession industrial
 PROPERTY

1. The accessory follows the principal;

2. The accessory follows the nature of that to
which it relates; and
3. What is built upon the land goes with it; or the
land is the principal, and whatever is built on it
becomes the accessory.

Rule on ownership regarding accession industrial

GR: The owner of the land is the owner of whatever is

built, planted or sown on that land, including the
improvements or repairs made thereon.

XPNs:
1. When the doer is in good faith the rule is
modified; or
2. Improvements on the land of one of the
spouses at the expense of the conjugal
partnership will belong to the partnership or to
the spouse who owns the land depending on
which of the two properties has a higher value
(FC, Art. 120).

NOTE: If the doer is in bad faith, he is entitled only to

necessary expenses for the preservation of the land.

Art. 447. 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.

Good faith and bad faith distinguished.

Good Faith - A person who is not aware that there exists

in his title or mode of acquisition any flaw which
invalidates it.

Bad Faith - A person who is aware that there exists in

his title or mode of acquisition any flaw which
invalidates it.

When Both Parties Are in Bad Faith

If both parties are in bad faith, the bad faith of one
cancels the bad faith of the other. Hence, both are
considered in good faith.

NOTE: Good faith is always presumed; and upon him

who alleges bad faith on the part of the possessor rests
the burden of proof.
 PROPERTY

Rule if the planter and owner of the land are different

Gathered Fruits

Planter in GF Planter in BF

Keeps fruits before possession is legally Reimbursed for expenses for

Planter interrupted (NCC, Art. 544, par. 1) (2008 production, gathering and
Bar). preservation (NCC, Art. 443).

No necessity to reimburse the planter of Owns fruits provided he pays planter

Landowner expenses since the planter retains the expenses for production, gathering and
fruits (NCC, Art. 544, par. 1). preservation (NCC, Art. 443).

Standing Crops

Planter in GF Planter in BF

Reimbursed for expenses, for Loses what is built, planted or sown

production, gathering and preservation
(NCC, Art.443).
Planter
Owns fruits provided he pays planter
Landowner expenses for production, gathering and
preservation (NCC, Art. 443).
without right to indemnity (NCC, Art
449).
Entitled to reimbursement for the
necessary expenses of preservation of
the land. (NCC, Art. 452).
Owns fruits (NCC, Art. 449).

Gathered Fruits

Planter in GF Planter in BF

Keeps fruits before possession is legally Reimbursed for expenses for

Planter interrupted (NCC, Art. 544, par. 1) (2008 production, gathering and
Bar). preservation (NCC, Art. 443).

No necessity to reimburse the planter of Owns fruits provided he pays planter

Landowner expenses since the planter retains the expenses for production, gathering and
fruits (NCC, Art. 544, par. 1). preservation (NCC, Art. 443).

Standing Crops

Planter in GF Planter in BF

Reimbursed for expenses, for Loses what is built, planted or sown

production, gathering and preservation
(NCC, Art.443).
Planter
Owns fruits provided he pays planter
Landowner expenses for production, gathering and
preservation (NCC, Art. 443).
without right to indemnity (NCC, Art
449).
Entitled to reimbursement for the
necessary expenses of preservation of
the land. (NCC, Art. 452).
Owns fruits (NCC, Art. 449).

Rule when the land owner is the builder, planter or sower (1999 Bar)
 PROPERTY
Land Owner and Builder, Planter or Sower
Good faith
Acquire building etc. after paying indemnity for value of
materials (NCC, Art. 447) (1999 Bar).
Bad faith
Acquire building etc. after paying value of materials AND
indemnity for damages, subject to the right of the owner of
materials to remove (NCC, Art. 447).
Good faith
1. Acquire w/o paying indemnity and right to damages
(NCC, Art 445 and 449, by analogy); and
2. Pay necessary expenses for preservation. (NCC, Articles
452 and 546).
Bad faith
As though both acted in good faith (in pari delicto)( NCC, Art. 453) (1999 Bar).
Rule when the land owner is NOT the builder, planter or sower
Land Owner
Good faith
He can either: (NCC, Art. 448) (1992, 1996, 2000, 2001
Bar).
1. Acquire improvements after paying indemnity for:
a. Necessary expenses; and
b. Useful expenses which could either be:
a. Original costs of improvements; or
b. Increase in the value of the whole (NCC,
Articles 443 and 546).
2. Sell the land to builder or planter or collect rent from
sower unless the value of the land is considerably
greater than the building etc., in which case, the
builder and planter shall pay rent.
The parties shall agree upon the terms of the lease and
in case of disagreement, the court shall fix the terms
thereof.
Good faith
1. The land owner can either:
a. Acquire improvements without paying indemnity
and collect damages (NCC, Articles 445, 449 and
451).
Owner of Materials
Good faith
1. Receive indemnity for value of materials; or
2. Remove materials if w/o injury to works, plantings or
constructions (NCC, Art. 447).
Good faith
1. Be indemnified for value of materials and damages; or
2. Remove materials, w/ or w/o injury and be
indemnified for damages (NCC, Art. 447).
Bad faith
1. Lose materials w/o being indemnified and pay
damages (NCC, Articles 445 and 449, by analogy); ans
2. Recover necessary expenses for preservation of land
without the right to retain the thing until the
indemnity is paid. (NCC, Articles 452 and 546).
Bad faith
Builder, Planter, Sower and Owner of Materials
Good faith
If the Land Owner:
1. Acquires the improvements after paying indemnity,
Builder, Planter, or Sower has the right to retain the
thing (and cannot be required to pay rent) until
indemnity is paid (NCC, Art. 546) .
If the useful improvements can be removed without
damage to the principal thing, the Builder, Planter or
Sower may remove them, unless the person who
recovers the possession exercises the other (NCC,
Articles 547 and 447).
2. Sells the land, Builder or Planter cannot be obliged to
buy the land if its value is considerably more than that
of the building or trees.
In such case, he shall pay reasonable rent.
The parties shall agree upon the terms of the lease and
in case of disagreement, the court shall fix the terms
thereof (NCC, Art. 448) (1992, 1996, 1999, 2000,
2001 Bar).
Bad faith
1. Lose improvements without right to be indemnified
unless the latter sells the land (NCC, Art. 449) (1996,
2000 Bar).
2. Recover necessary expenses for preservation of land
without the right to retain the thing until the
 PROPERTY

b. Order the demolition of work or restoration to indemnity is paid (NCC, Articles 452 and 546).
former condition and collect damages in both 3. Pay damages to land owner (NCC, Art. 451).
cases (NCC, Art. 450); or
c. Sell the land to builder and planter or rent it to
the sower, and collect damages in both cases
(NCC, Art. 450) (2008 Bar).

2. Pay necessary expenses for preservation (NCC, Articles

452 and 546).

Bad Faith Good Faith

Acquires improvements after paying indemnity and 1.
damages to builder, planter, sower, unless the latter
decides to remove (NCC, Articles 454 and 447). 2.
He cannot compel the builder planter or sower to buy the
land.
Receive indemnity for improvements and receive
damages; or
Remove them in any event and receive damages
(NCC, Aricles 454 and 447).

The reason why said article (NCC, Art. 447) applies may be
explained as follows:

That if the land owner knew that something was being

built, planted or sown on his land by another and he
did not interpose any objection thereto, it is as if he
was the one building, planting or sowing in bad faith on
his own land with materials belonging to another,
using the owner of the materials as his worker
(Rabuya, 2008).

Bad Faith Bad Faith

As though both acted in good faith (in pari delicto) (Art. 453).

Rule when the land owner, builder, planter, sower and owner of materials are different persons

Land Owner Builder, Planter, Sower Owner of Materials

Good faith Good faith Good faith

Pay value of materials to its owner a. Collect value of materials

He shall answer subsidiarily for their
without paying damages (NCC, Art. 455). primarily from builder, planter,
value and only in the event that the one
who made use of them has no property and sower, subsidiarily from land
with which to pay (NCC, Art. 455). owner (NCC, Art. 455); or
If the Land Owner:
and b. Remove the materials only if
1. Acquires the improvement, w/o injury to the work
He can either: (NCC, Art. 448) Builder, Planter, or Sower may constructed, or without the
1. Acquire improvements after paying demand from the landowner the plantings, constructions or
indemnity for: value of the materials and labor works being destroyed (NCC,
a. Necessary expenses; and (NCC, Art 455). Art. 447).
b. Useful expenses which could
either be: And he has the right to retain the NOTE: Landowner is
a. Original costs of thing (and cannot be required to subsidiarily liable only if he
improvements; or pay rent) until indemnity is paid appropriates/acquires the
b. Increase in the value of the (NCC, Art. 546). improvements.
whole (NCC, Art. 546 & 443).
If the useful improvements can be
2. Sell the land to builder and planter or removed without damage to the
collect rent from sower unless the principal thing, the possessor in
value of the land is considerably good faith may remove them,

greater than the building etc., in
which case, the builder and planter
shall pay rent.
The parties shall agree upon the 2.
terms of the lease and in case of
disagreement, the court shall fix the
terms thereof.
Good faith
Land Owner can either: (NCC, Art. 448)
1. Acquire improvements after paying
indemnity for:
a. Necessary expenses; and
b. Useful expenses which could
either be:
a. Original costs of
improvements; or
b. Increase in the value of the
whole (NCC, Articles 546
and 443).
2. Sell the land to builder and planter
or collect rent from sower unless the
value of the land is considerably
greater than the building etc., in
which case, the builder and planter
shall pay rent.
The parties shall agree upon the
terms of the lease and in case of
disagreement, the court shall fix the
terms thereof.
Without subsidiary liability for cost
of materials.
Good Faith
1. Option to:
a. Acquire improvements without
paying indemnity and collect
damages (NCC, Articles 445 and
449);
PROPERTY
unless the person who recovers the
possession exercises the other
(NCC, Articles 547 and 447); or
Sells the land or rents it, Builder or
Planter cannot be obliged to buy
the land if its value is considerably
more than that of the building or
trees.
In such case, he shall pay
reasonable rent.
The parties shall agree upon the
terms of the lease and in case of
disagreement, the court shall fix
the terms thereof (NCC, Art. 448).
Good faith Bad faith
If the Land Owner: 1. Loses materials without right to
indemnity (NCC, Art. 449); and
1. Acquires the improvement,
Builder, Planter, or Sower has the 2. Pays damages (NCC, Art. 451)
right to retain the thing (and
cannot be required to pay rent) The builder, planter or sower would
until indemnity is paid (NCC, Art. be considered merely an agent of the
546). owner of materials.
If the useful improvements can be Therefore, the provisions of Article
removed without damage to the 449 of the Civil Code will apply by
principal thing, the possessor in analogy. He is even liable for
good faith may remove them, damages (Rabuya, 2008).
unless the person who recovers
the possession exercises the other
(NCC, Art. 547); or
2. Sells or rents it, Builder or Planter
cannot be obliged to buy the land
if its value is considerably more
than that of the building or trees.
In such case, he shall pay
reasonable rent.
The parties shall agree upon the
terms of the lease and in case of
disagreement, the court shall fix
the terms thereof (NCC, Art. 448).
Without indemnity to owner of
materials and collects damages
from him.
Bad Faith Bad Faith
1. Recover value from Builder,
1. Lose improvements without right Planter, Sower (in pari delicto);
to be indemnified unless the
landowner sells the land (NCC, 2. If Builder, Planter, Sower
Art. 449); acquired improvements,
 PROPERTY

b. Order the demolition of work or remove the materials only if

restoration to former condition 2. Recover necessary expenses for without injury to the work
and collect damages in both preservation of land without the constructed, or without the
cases (NCC, Art. 450); or right to retain the thing until the plantings, constructions or
c. Sell the land to builder and indemnity is paid (NCC, Articles works being destroyed (NCC,
planter or rent it to the sower, 452 and 546); Art. 447);
and collect damages in both
cases (NCC, Art. 450); 3. Pay the value of the materials to 3. No action against land owner;
the owner of the materials.; and and
2. Has right to demand damages from
both (NCC, Art. 451); Since both the owner of the materials 4. May be liable to the land owner
and the builder, etc. acted in bad faith, for damages (NCC, Art. 451).
3. Pay necessary expenses for as between them, they are treated as
preservation (NCC, Art. 452 & 546); having both acted in good faith (De
and Leon, 2006).

4. Not subsidiarily liable to the owner of 4. Pay damages to land owner (NCC,
the materials because as to him, the Art. 451).
two acted in bad faith (De Leon,
2006).

Bad faith Bad faith Bad faith

Same as though both acted in good faith (in pari delicto)( NCC, Art. 453).

Bad faith Good faith Good faith

1. Acquires improvements after paying

indemnity and damages, unless the If he pays the owner of the materials, 1. Collect value of materials
latter decides to remove (NCC, Art. plants or seeds: primarily from builder, planter,
454, 447 & 443); and sower, subsidiarily from land owner
(NCC, Art. 455); or
i. He may demand from the
2. Cannot compel builder, planter and landowner the value of the 2. Remove the materials in any
sower to buy land. materials and labor (NCC, Art 455) event, with a right to be indemnified
and shall also be obliged to the for damages (NCC, Art. 447).
reparation of damages (NCC, Art.
447); or
ii. Remove the materials in any event,
with a right to be indemnified for
damages (NCC, Articles 454 and
447).

Bad faith Bad faith Good faith

Pay value of materials to its owner 1. Collect value of materials

The owner of the land shall answer
(NCC, Art. 455) primarily from builder, planter,
subsidiarily for their value and only in the
event that the one who made use of them and sower, subsidiarily from land
has no property with which to pay (NCC, owner (NCC, Art. 455); or
Art. 455). If the Land Owner:
2. Remove the materials in any
and 1. Acquires the improvement, event, with a right to be
Builder, Planter, or Sower may indemnified for damages (NCC,
Land Owner can either: (NCC, Art. 448) demand from the landowner the Art. 447).
value of the materials and labor
1. Acquire improvements after paying (NCC, Art 455).
indemnity for:
a. Necessary expenses, and And he has the right to retain the thing
b. Useful expenses which could (and cannot be required to pay rent)
either be: until indemnity is paid (Art. 546).
i. Original costs of
 PROPERTY

improvements If the useful improvements can be

ii. Increase in the value of the removed without damage to the
whole (NCC, Articles 546 and principal thing, the possessor in good
443). faith may remove them, unless the
person who recovers the possession
2. Sell the land to builder and planter or exercises option 2 (NCC, Articles 547
collect rent from sower unless the value of and 447);
the land is considerably greater than the
building etc., in which case, the builder
2. Sells or rents it, Builder or Planter
and planter shall pay rent. cannot be obliged to buy the land if its
value is considerably more than that of
The parties shall agree upon the terms of the building or trees.
the lease and in case of disagreement, the
court shall fix the terms thereof. In such case, he shall pay reasonable
rent.

The parties shall agree upon the terms

of the lease and in case of disagreement,
the court shall fix the terms thereof
(NCC, Art. 448).