Property Case Doctrines.docx

CLASSIFICATION OF PROPERTY LADERA v. HODGES G.R. No. 8027-R; Vol. 48, No. 12, Official Gazette 5374 September 23, 1952 Reyes, J.B.L., J. Issue: Is Ladera’s house an immovable property? Held: YES. The old Civil Code enumerates among the things declared by it as immovable property the following: lands, buildings, roads and constructions of all kind adhered to the soil. The law does not make any distinction whether or not the owner of the lot is the one who built. Also, since the principles of accession regard buildings and constructions as mere accessories to the land on which it is built, it is logical that said accessories should partake the nature of the principal thing. MINDANAO BUS COMPANY vs.THE CITY ASSESSOR & TREASURER and the BOARD OF TAX APPEALS of Cagayan de Oro City G.R. No. L-17870 September 29, 1962 Labrador, J.: Issue: Whether or not tools, equipment and machineries of petitioner bus company are taxable realties, by reason of their being intended or destined for use in an industry. Held: No. The law that governs the determination of the question at issue is Par. 5, Art. 415 of the Civil Code which states that: “Machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried on in a building or on a piece of land, and which tend directly to meet the needs of the said industry or works. So that movable equipment to be immobilized in contemplation of the law must first be "essential and principal elements" of an industry or works without which such industry or works would be "unable to function or carry on the industrial purpose for which it was established." We may here distinguish, therefore, those movable which become immobilized by destination because they are essential and principal elements in the industry for those which may not be so considered immobilized because they are merely incidental, not essential and principal. The tools and equipment in question in this instant case are, by their nature, not essential and principle municipal elements of petitioner's business of transporting passengers and cargoes by motor trucks. They are merely incidentals — acquired as movables and used only for expediency to facilitate and/or improve its service. Even without such tools and equipments, its business may be carried on, as petitioner has carried on, without such equipment, before the war. The transportation business could be carried on without the repair or service shop if its rolling equipment is repaired or serviced in another shop belonging to another. Aside from the element of essentiality the above-quoted provision also requires that the industry or works be carried on in a building or on a piece of land. But in the case at bar the equipments in question are destined only to repair or service the transportation business, which is not carried on in a building or permanently on a piece of land, as demanded by the law. Said equipments may not, therefore, be deemed real property. MAKATI LEASING & FINANCE CORP. v. WEAREVER TEXTILES G.R. No. L-58469 May 16, 1983 De Castro, J. Issue: Whether the machinery in suit is real or personal property. Held: The SC ruled that it is personal property. The SC relied on its ruling in Tumalad v. Vicencio, that if a house of strong materials can be the subject of a Chattel Mortgage as long as the parties to the contract agree and no innocent 3rd party will be prejudiced then more so that a machinery may treated as a movable since it is movable by nature and becomes immobilized only by destination. And treating it as a chattel by way of a Chattel Mortgage, Wearever is estopped from claiming otherwise.

SANTOS EVANGELISTA v. ALTO SURETY & INSURANCE CO., INC. G.R. No. L-11139 April 23, 1958 Concepcion, J. Issue: Can an agreement to subject a house to a chattel mortgage binding upon third persons? Held: No. It is true that the parties to a deed of chattel mortgage may agree to consider a house as personal property for purposes of said contract However, this view is good only insofar as the contracting parties are concerned. It is based, partly, upon the principle of estoppel. Neither this principle, nor said view, is applicable to strangers to said contract. Much less is it in point where there has been no contract whatsoever, with respect to the status of the house involved, as in the case at bar. _____________________________________________________ TSAI v. COURT OF APPEALS G.R. No. 120098 October 2, 2001 Quisumbing, J. Issue: Whether or not the acquired machineries should be considered as Chattels or Real Properties. Held: Petitioners contend that the nature of the disputed machineries, i.e., that they were heavy, bolted or cemented on the real property mortgaged by EVERTEX to PBCom, make them ipso facto immovable under Article 415 (3) and (5) of the New Civil Code. This assertion, however, does not settle the issue. Mere nuts and bolts do not foreclose the controversy. We have to look at the parties' intent. While it is true that the controverted properties appear to be immobile, a perusal of the contract of Real and Chattel Mortgage executed by the parties herein gives us a contrary indication. In the case at bar, both the trial and the appellate courts reached the same finding that the true intention of PBCOM and the owner, EVERTEX, is to treat machinery and equipment as chattels. In the absence of any showing that this conclusion is baseless, erroneous or uncorroborated by the evidence on record, we find no compelling reason to depart therefrom. Too, assuming arguendo that the properties in question are immovable by nature, nothing detracts the parties from treating it as chattels to secure an obligation under the principle of estoppel. As far back as Navarro v. Pineda, 9 SCRA 631 (1963), an immovable may be considered a personal property if there is a stipulation as when it is used as security in the payment of an obligation where a chattel mortgage is executed over it, as in the case at bar. _____________________________________________________ SERG’S PRODUCTS, INC. vs. PCI LEASING AND FINANCE, INC. G.R. No. 137705. August 22, 2000 Panganiban, J.: ISSUE: Whether the machineries purchased, imported and installed by Petitioner became real property by virtue of immobilization. HELD: No. Petitioners installed the machines subject of the writ of seizure in the factory built on their own land for use in the chocolate-making industry. While each machine by itself is a movable or personal property, together these may be treated as immovable by destination being essential and principal elements in petitioner’s industry. Article 415 (5) of the Civil Code classifies as real property, “machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried on in a building or on a piece of land, and which tend directly to meet the needs of the said industry or works.” However, the contracting parties may validly stipulate that real property be considered as personal. Section 12.1 of the Agreement between the parties provides “The PROPERTY is, and shall at all times be and remain, personal property notwithstanding

that the PROPERTY or any part thereof may now be, or hereafter become, in any manner affixed or attached to or embedded in, or permanently resting upon, real property or any building thereon, or attached in any manner to what is permanent.” Since the petitioners agreed to the above-quoted stipulation, they should not be allowed to claim otherwise on the principle of estoppel. A party to a contract is ordinarily precluded from denying the truth of any material fact found therein. The machines in this case are personal properties capable of being subjects of a Writ of Replevin. _____________________________________________________ BURGOS v. CHIEF OF STAFF G.R. No. L-64261 Dec. 26, 1984 Escolin, J.

deterioration. Obviously the separation or removal of the pump involved nothing more complicated than the loosening of bolts or dismantling of other fasteners. Yap's last claim is that in the process of the removal of the pump from his house, Goulds' men had trampled on the plants growing there, destroyed the shed over the pump, plugged the exterior casings with rags and cut the electrical and conduit pipes; that he had thereby suffered actual-damages in an amount of not less than P 2,000.00, as well as moral damages in the sum of P 10,000.00 resulting from his deprivation of the use of his water supply; but the Court had refused to allow him to prove these acts and recover the damages rightfully due him. Now, as to the loss of his water supply, since this arose from acts legitimately done, the seizure on execution of the water pump in enforcement of a final and executory judgment, Yap most certainly is not entitled to claim moral or any other form of damages thereof. _____________________________________________________

Issue: Whether or not the properties seized under the disputed search warrants were immovable properties, thus making them unsusceptible to seizure under such warrants. Held: No. Under Article 415[5] of the Civil Code of the Philippines, "machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried on in a building or on a piece of land and which tend directly to meet the needs of the said industry or works" are considered immovable property. In Davao Sawmill Co. v. Castillo, the Court ruled that machinery which is movable by nature becomes immobilized when placed by the owner of the tenement, property or plant, but not so when placed by a tenant, usufructuary, or any other person having only a temporary right, unless such person acted as the agent of the owner. Petitioners did not claim to be the owners of the land and/or building on which the printing machineries were placed. This being the case, the machineries in question, while in fact bolted to the ground remain movable property susceptible to seizure under a search warrant. _____________________________________________________ LOPEZ v OROSA G.R. Nos. L-10817-18 February 28, 1958 FELIX, J.: Issue: Whether real estate or immovable property mean land and building? Held: No. We cannot subscribe to this view, for while it is true that generally, real estate connotes the land and the building constructed thereon, it is obvious that the inclusion of the building, separate and distinct from the land, in the enumeration of what may constitute real propertie could mean only one thing — that a building is by itself an immovable property, a doctrine already pronounced by this Court in the case of Leung Yee vs. Strong Machinery Co. Moreover, and in view of the absence of any specific provision of law to the contrary, a building is an immovable property, irrespective of whether or not said structure and the land on which it is adhered to belong to the same owner. _____________________________________________________ JULIAN S. YAP vs. HON. SANTIAGO O. TAÑADA, etc., and GOULDS PUMPS INTERNATIONAL (PHIL.), INC. G.R. No. L-32917 July 18, 1988 NARVASA, J.: ISSUE: Whether or not the water pump had become immovable property by its being installed in petitioner’s residence. HELD: Yap's next argument that the water pump had become immovable property by its being installed in his residence is also untenable. The Civil Code considers as immovable property, among others, anything "attached to an immovable in a fixed manner, in such a way that it cannot be separated therefrom without breaking the material or deterioration of the object." The pump does not fit this description. It could be, and was in fact separated from Yap's premises without being broken or suffering

MACHINERY & ENGINEERING SUPPLIES, INC. vs. CA G.R. No. L-7057 October 29, 1954 CONCEPCION, J.: ISSUE: Whether or not an action for replevin is the proper remedy to recover machinery and equipment classified as real properties. HELD: No. The special civil action known as replevin, governed by Rule 62 of Court, is applicable only to "personal property". Ordinarily replevin may be brought to recover any specific personal property unlawfully taken or detained from the owner thereof, provided such property is capable of identification and delivery; but replevin will not lie for the recovery of real property or incorporeal personal property. (77 C. J. S. 17) When the sheriff repaired to the premises of respondent, Ipo Limestone Co., Inc., machinery and equipment appeared to be attached to the land, particularly to the concrete foundation of said premises, in a fixed manner, in such a way that the former could not be separated from the latter "without breaking the material or deterioration of the object." Moreover, said machinery and equipment were "intended by the owner of the tenement for an industry" carried on said immovable and tended." For these reasons, they were already immovable property pursuant to paragraphs 3 and 5 of Article 415 of Civil Code of the Philippines. As such immovable property, they were not subject to replevin. However, the Supreme Court noted and affirmed the decision of CA stating that: The question of ownership and the applicability of Art. 415 of the new Civil Code are immaterial in the determination of the only issue involved in this case. The question as to whether the machinery or equipment in litigation are immovable or not is likewise immaterial, because the only issue raised before the trial court was whether the Provincial Sheriff of Bulacan, at the Petitioner's instance, was justified in destroying the machinery and in refusing to restore them to their original form, at the expense of the Petitioner. _____________________________________________________ Laurel v. Garcia G.R. No. 92013 July 25, 1990 Gutierrez, JR., J.: Issue: Can the Roppongi property and others of its kind be alienated by the Philippine Government? Held: NO. The nature of the Roppongi lot as property for public service is expressly spelled out. It is dictated by the terms of the Reparations Agreement and the corresponding contract of procurement which bind both the Philippine government and the Japanese government. There can be no doubt that it is of public dominion unless it is convincingly shown that the property has become patrimonial. As property of public dominion, the Roppongi lot is outside the commerce of man. It cannot be alienated. Its ownership is a special collective ownership for general use and enjoyment, an

application to the satisfaction of collective needs, and resides in the social group. The purpose is not to serve the State as a juridical person, but the citizens; it is intended for the common and public welfare and cannot be the object of appropration. Articles 419-421 of the Civil Code apply.

without just compensation in violation of Section 1, subsection (2), Article III of the Constitution, but simply as a manifestation of its right and power to deal with state property."

Issue: Does the Chief Executive, her officers and agents, have the authority and jurisdiction, to sell the Roppongi property?

MACASIANO v. DIOKNO G.R. No. 97764 August 10, 1992 Medialdea, J.:

Held: NO. There is no law authorizing its conveyance. It is not for the President to convey valuable real property of the government on his or her own sole will. Any such conveyance must be authorized and approved by a law enacted by the Congress. It requires executive and legislative concurrence. Resolution No. 55 of the Senate dated June 8, 1989, asking for the deferment of the sale of the Roppongi property does not withdraw the property from public domain much less authorize its sale. It is a mere resolution; it is not a formal declaration abandoning the public character of the Roppongi property. In fact, the Senate Committee on Foreign Relations is conducting hearings on Senate Resolution No. 734 which raises serious policy considerations and calls for a fact-finding investigation of the circumstances behind the decision to sell the Philippine government properties in Japan. _____________________________________________________ RABUCO v. VILLEGAS G.R. No. L-24661 February 28, 1974 TEEHANKEE, J. Issue: Whether or not Republic Act 3120 is constitutional. Held: Yes. Respondents city officials' contention that the Act must be stricken down as unconstitutional for depriving the city of Manila of the lots in question and providing for their sale in subdivided small lots to bona fide occupants or tenants without payment of just compensation is untenable and without basis, since the lots in question are manifestly owned by the city in its public and governmental capacity and are therefore public property over which Congress had absolute control as distinguished from patrimonial property owned by it in its private or proprietary capacity of which it could not be deprived without due process and without just compensation.

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ISSUE: Is the disputed municipal ordinance authorizing the flea market on the public streets valid? HELD: Properties of the local government which are devoted to public service are deemed public and are under the absolute control of Congress. Hence, local governments have no authority whatsoever to control or regulate the use of public properties unless specific authority is vested upon them by Congress. One such example of this authority given by Congress to the local governments is the power to close roads as provided in Section 10, Chapter II of Blg. 337, known as Local Government Code, which should be read and interpreted in accordance with basic principles already established by law. These basic principles have the effect of limiting such authority of the province, city or municipality to close a public street or thoroughfare. Article 424 of the Civil Code lays down the basic principle that properties of public dominion devoted to public use and made available to the public in general are outside the commerce of man and cannot be disposed of or leased by the local government unit to private persons. Aside from the requirement of due process which should be complied with before closing a road, street or park, the closure should be for the sole purpose of withdrawing the road or other public property from public use when circumstances show that such property is no longer intended or necessary for public use or public service. When it is already withdrawn from public use, the property then becomes patrimonial property of the local government unit concerned. It is only then that the respondent municipality can use or convey them for any purpose for which other real property belonging to the local unit concerned might be lawfully used or conveyed. However, those roads and streets which are available to the public in general and ordinarily used for vehicular traffic are still considered public property devoted to public use. In such case, the local government has no power to use it for another purpose or to dispose of or lease it to private persons.

Here, Republic Act 3120 expressly declared that the properties were "reserved as communal property" and ordered their conversion into "disposable and alienable lands of the State" for sale in small lots to the bona fide occupants thereof. It is established doctrine that the act of classifying State property calls for the exercise of wide discretionary legislative power which will not be interfered with by the courts.

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The Court in a case reaffirmed the established general rule that "regardless of the source or classification of land in the possession of a municipality, excepting those acquired with its own funds in its private or corporate capacity, such property is held in trust for the State for the benefit of its inhabitants, whether it be for governmental or proprietary purposes. It holds such lands subject to the paramount power of the legislature to dispose of the same, for after all it owes its creation to it as an agent for the performance of a part of its public work, the municipality being but a subdivision or instrumentality thereof for purposes of local administration. Accordingly, the legal situation is the same as if the State itself holds the property and puts it to a different use" and stressed that "the property, as has been previously shown, was not acquired by the City of Manila with its own funds in its private or proprietary capacity. That it has in its name a registered title is not questioned, but this title should be deemed to be held in trust for the State as the land covered thereby was part of the territory of the City of Manila granted by the sovereign upon its creation."

Issue: Can a foreign national apply for registration of title over a parcel of land which he acquired by purchase while still a citizen of the Philippines, from a vendor who has complied with the requirements for registration under the Public Land Act (CA 141)?

There as here, the Court holds that the Acts in question (Republic Acts 4118 in Salas and Republic Act 3120 in the case at bar) were intended to implement the social justice policy of the Constitution and the government program of land for the landless and that they were not "intended to expropriate the property involved but merely to confirm its character as communal land of the State and to make it available for disposition by the National Government: ... The subdivision of the land and conveyance of the resulting subdivision lots to the occupants by Congressional authorization does not operate as an exercise of the power of eminent domain

REPUBLIC OF THE PHILIPPINES v. THE COURT OF APPEALS AND SPOUSES MARIO B. LAPIÑA AND FLOR DE VEGA G.R. No. 108998 August 24, 1994 BIDIN, J.

Held: Yes. The evidence thus presented established that applicants, by themselves and their predecessors-in-interest, had been in open, public, peaceful, continuous, exclusive and notorious possession and occupation of the two adjacent parcels of land applied for registration of title under a bona-fide claim of ownership long before June 12, 1945. Such being the case, it is conclusively presumed that all the conditions essential to the confirmation of their title over the two adjacent parcels of land are sought to be registered have been complied with thereby entitling them to the issuance of the corresponding certificate of title pursuant to the provisions of Presidential Decree No. 1529, otherwise known as the Property Registration Decree. It must be noted that with respect to possession and occupation of the alienable and disposable lands of the public domain, the law employs the terms "by themselves", "the applicant himself or through his predecessor-in-interest". Thus, it matters not whether the vendee/applicant has been in possession of the subject property for only a day so long as the period and/or legal requirements for confirmation of title has been complied with by his predecessor-in-interest, the said period is tacked to his possession. In the case at bar, respondents' predecessors-ininterest have been in open, continuous, exclusive and notorious possession of the disputed land not only since June 12, 1945, but

even as early as 1937. Petitioner does not deny this except that respondent spouses, in its perception, were in possession of the land sought to be registered only in 1978 and therefore short of the required length of time. As aforesaid, the disputed parcels of land were acquired by private respondents through their predecessors-in-interest, who, in turn, have been in open and continued possession thereof since 1937. Private respondents stepped into the shoes of their predecessors-in-interest and by virtue thereof, acquired all the legal rights necessary to confirm what could otherwise be deemed as an imperfect title. _____________________________________________________ The Province of Zamboanga Del Norte VS. City of Zamboanga G.R. No. L-24440 28 March 1968 Bengzon, J: ISSUE: Which of the two norms, i.e., that of the Civil Code or that obtaining under the law of Municipal Corporations, must be used in classifying the 50 lots in question? HELD: The Law on Municipal Corporation should be followed. Under the Civil Code, to be of public property, they should fall under the phrase "public works for public service" for it has been held that under the ejusdem generis rule, such public works must be for free and indiscriminate use by anyone, just like the preceding enumerated properties in the first paragraph of Art 424. ( Hence, even the hospitals and schools cannot be considered as public properties.) Unlike in the classification regarding State properties, properties for public service in the municipalities are not classified as public. However, the Law on Municipal Corporation provides that to be considered public, it is enough that the property be held and devoted for governmental purposes like local administration, public education, public health, etc. Supporting jurisprudence are found in the following cases: (1) HINUNANGAN V. DIRECTOR OF LANDS, where it was stated that "... where the municipality has occupied lands distinctly for public purposes, such as for the municipal court house, the public school, the public market, or other necessary municipal building, we will, in the absence of proof to the contrary, presume a grant from the States in favor of the municipality; but, as indicated by the wording, that rule may be invoked only as to property which is used distinctly for public purposes...." (2) VIUDA DE TANTOCO V. MUNICIPAL COUNCIL OF ILOILO held that municipal properties necessary for governmental purposes are public in nature. Thus, the auto trucks used by the municipality for street sprinkling, the police patrol automobile, police stations and concrete structures with the corresponding lots used as markets were declared exempt from execution and attachment since they were not patrimonial properties. (3) MUNICIPALITY OF BATANGAS VS. CANTOS held squarely that a municipal lot which had always been devoted to school purposes is one dedicated to public use and is not patrimonial property of a municipality. _____________________________________________________ CHAVEZ vs. PUBLIC ESTATES AUTHORITY G.R. No. 133250 July 9, 2002 Carpio, J. ISSUES: 1. Are reclaimed lands comprising the Freedom Islands alienable or disposable lands of the public domain? 2. Are submerged areas of the Manila Bay alienable and disposable lands of the public domain? 3. Can AMARI, a private corporation, acquire and own under the Amended JVA, 367.5 hectares of reclaimed foreshore and submerged areas in Manila Bay? HELD: 1. YES. The reclaimed lands comprising the Freedom Islands were held by the Court to be alienable and disposable lands of the public domain.

Under Section 2, Article XII of the 1987 Constitution, the foreshore and submerged areas of Manila Bay are part of the "lands of the public domain, waters x x x and other natural resources" and consequently "owned by the State." As such, foreshore and submerged areas "shall not be alienated," unless they are classified as "agricultural lands" of the public domain. The mere reclamation of these areas by PEA does not convert these inalienable natural resources of the State into alienable or disposable lands of the public domain. There must be a law or presidential proclamation officially classifying these reclaimed lands as alienable or disposable and open to disposition or concession. Moreover, these reclaimed lands cannot be classified as alienable or disposable if the law has reserved them for some public or quasi-public use. Section 8 of CA No. 141 provides that "only those lands shall be declared open to disposition or concession which have been officially delimited and classified." The President has the authority to classify inalienable lands of the public domain into alienable or disposable lands of the public domain, pursuant to Section 6 of CA No. 141. PD No. 1085, coupled with President Aquino's actual issuance of a special patent covering the Freedom Islands, is equivalent to an official proclamation classifying the Freedom Islands as alienable or disposable lands of the public domain. PD No. 1085 and President Aquino's issuance of a land patent also constitute a declaration that the Freedom Islands are no longer needed for public service. The Freedom Islands are thus alienable or disposable lands of the public domain, open to disposition or concession to qualified parties. At the time then President Aquino issued Special Patent No. 3517, PEA had already reclaimed the Freedom Islands although subsequently there were partial erosions on some areas. The government had also completed the necessary surveys on these islands. Thus, the Freedom Islands were no longer part of Manila Bay but part of the land mass. Section 3, Article XII of the 1987 Constitution classifies lands of the public domain into "agricultural, forest or timber, mineral lands, and national parks." Being neither timber, mineral, nor national park lands, the reclaimed Freedom Islands necessarily fall under the classification of agricultural lands of the public domain. Under the 1987 Constitution, agricultural lands of the public domain are the only natural resources that the State may alienate to qualified private parties. All other natural resources, such as the seas or bays, are "waters x x x owned by the State" forming part of the public domain, and are inalienable pursuant to Section 2, Article XII of the 1987 Constitution.

2. NO. The submerged areas of the Manila Bay were held to be inalienable and outside the commerce of man until classified as alienable or disposable lands open to disposition and declared no longer needed for public service. CA No. 141 requires that lands of the public domain must first be classified as alienable or disposable before the government can alienate them. These lands must not be reserved for public or quasi-public purposes. Presidential Decree No. 3-A, issued on January 11, 1973, revoked all laws authorizing the reclamation of areas under water and revested solely in the National Government the power to reclaim lands. Executive Order No. 525, issued on February 14, 1979, designated PEA as the National Government's implementing arm to undertake "all reclamation projects of the government," which "shall be undertaken by the PEA or through a proper contract executed by it with any person or entity." Under such contract, a private party receives compensation for reclamation services rendered to PEA. Payment to the contractor may be in cash, or in kind consisting of portions of the reclaimed land, subject to the constitutional ban on private corporations from acquiring alienable lands of the public domain. The Amended JVA covers not only the Freedom Islands, but also an additional 592.15 hectares which are still submerged and forming part of Manila Bay. There is no legislative or Presidential act classifying these submerged areas as alienable or disposable lands of the public domain open to disposition. These submerged areas are not covered by any patent or certificate of title. There can be no dispute that these submerged areas form part of the public domain, and in their present state are inalienable and outside the commerce of man. Until reclaimed from the sea, these submerged areas are, under the Constitution, "waters x x x owned

by the State," forming part of the public domain and consequently inalienable. Only when actually reclaimed from the sea can these submerged areas be classified as public agricultural lands, which under the Constitution are the only natural resources that the State may alienate. Once reclaimed and transformed into public agricultural lands, the government may then officially classify these lands as alienable or disposable lands open to disposition. Thereafter, the government may declare these lands no longer needed for public service. Only then can these reclaimed lands be considered alienable or disposable lands of the public domain and within the commerce of man. Section 3 of EO No. 525, by declaring that all lands reclaimed by PEA "shall belong to or be owned by the PEA," could not automatically operate to classify inalienable lands into alienable or disposable lands of the public domain. Otherwise, reclaimed foreshore and submerged lands of the public domain would automatically become alienable once reclaimed by PEA, whether or not classified as alienable or disposable. 3. NO. Since the Amended JVA seeks to transfer to AMARI, a private corporation, ownership of 77.34 hectares of the Freedom Islands, such transfer is void for being contrary to Section 3, Article XII of the 1987 Constitution which prohibits private corporations from acquiring any kind of alienable land of the public domain. Furthermore, Since the Amended JVA also seeks to transfer to AMARI ownership of 290.156 hectares of still submerged areas of Manila Bay, such transfer is void for being contrary to Section 2, Article XII of the 1987 Constitution which prohibits the alienation of natural resources other than agricultural lands of the public domain. _____________________________________________________ Villarico v. Sarmiento G.R. No. 136438 November 11, 2004 SANDOVAL-GUTIERREZ, J.: Issues: 1. What is contemplated by the phrase "intended for public use" in Article 420?

property. The only issue in an action for forcible entry is the physical or material possession of real property, that is, possession de facto and not possession de jure. The philosophy underlying this remedy is that irrespective of the actual condition of the title to the property, the party in peaceable quiet possession shall not be turned out by strong hand, violence or terror. A judgment rendered in a case for recovery of possession is conclusive only on the question of possession and not on the ownership. It does not in any way bind the title or affect the ownership of the land or building; a judgment in forcible entry or detainer case disposes of no other issue than possession and declares only who has the right of possession, but by no means constitutes a bar to an action for determination of who has the right or title of ownership. _____________________________________________________ SPOUSES BUSTOS V. CA G.R. No 120784-85 January 24, 2001 Pardo, J. Issue: Can petitioners be ejected from their own land? Held: No. Admittedly, the decision in the ejectment case is final and executory. However, the ministerial duty of a court to order execution of a final and executory judgment admits of exceptions such as where it becomes imperative in the higher interest of justice to direct suspension of the execution of the judgment, or whenever necessary to accomplish the aims of justice, or when certain facts and circumstances transpired after the judgment became final, which would render execution of the judgment unjust. In the present case, the stay of execution is warranted because petitioners are now legal owners of the land in question and are occupants thereof. To eject petitioners would then result to grave injustice. Placing petitioners in the possession of the land in question is a necessary and logical consequence of the decision declaring them as rightful owners of the property. One of the essential attributes of ownership is possession. An owner, who cannot exercise the “seven juses” or attributes of ownership, is a crippled owner.

2. What are the effects if a property is of public dominion? _____________________________________________________ Held: 1. Public use is “use that is not confined to privileged individuals, but is open to the indefinite public.” Applying this to the instant case, the lot under scrutiny consists of stairways which were built for the use of the people as passageway to the highway. Consequently, it is a property of public dominion. 2. Property of public dominion is outside the commerce of man and hence it: (1) cannot be alienated or leased or otherwise be the subject matter of contracts; (2) cannot be acquired by prescription against the State; (3) is not subject to attachment and execution; and (4) cannot be burdened by any voluntary easement. Applying this in this case, considering that the lot on which the stairways were constructed is a property of public dominion, it cannot be burdened by a voluntary easement of right of way, which the petitioner here is claiming. In fact, its use by the public is by mere tolerance of the government through the DPWH. Petitioner cannot appropriate it for himself. Verily, he cannot claim any right of possession over it. _____________________________________________________ OWNERSHIP JAVIER v. VERIDIANO II G.R. No. L-48050 October 10, 1994 Bellosillo, J. Issue: Whether or not a prior case of forcible entry is res judicata upon the second case on quieting of title. Held: No. In a complaint for forcible entry, what is at issue is prior possession, regardless of who has lawful title over the disputed

SORIANO vs. CA G.R. No. 128177 August 15, 2001 YNARES-SANTIAGO, J.: Issue: May a winning party in a land registration case effectively eject the possessor thereof, whose security of tenure rights are still pending determination before the DARAB? Held: No. Possession and ownership are distinct legal concepts. There is ownership when a thing pertaining to one person is completely subjected to his will in a manner not prohibited by law and consistent with the rights of others. Ownership confers certain rights to the owner, among which are the right to enjoy the thing owned and the right to exclude other persons from possession thereof. On the other hand, possession is defined as the holding of a thing or the enjoyment of a right. Literally, to possess means to actually and physically occupy a thing with or without right. Possession may be had in one of two ways: possession in the concept of an owner and possession of a holder. A person may be declared owner but he may not be entitled to possession. The possession may be in the hands of another either as a lessee or a tenant. A person may have improvements thereon of which he may not be deprived without due hearing. He may have other valid defenses to resist surrender of possession. A judgment for ownership, therefore, does not necessarily include possession as a necessary incident. There is no dispute that private respondents’ (petitioners below) title over the land under litigation has been confirmed with finality. As explained above, however, such declaration pertains only to ownership and does not automatically include possession, especially so in the instant case where there is a third party occupying the said parcel of land, allegedly in the concept of an agricultural tenant.

GARCIA vs. COURT OF APPEALS G.R. No. 133140 August 10, 1990 Puno, J. Issue: Whether Garcia’s possession is in a concept of an owner? Held: No. Garcia’s possession which started only in 1986 could not ripen into ownership. He has no valid title thereto. His possession in fact was that of an intruder, one done in bad faith (to defeat PBCom’s Writ of Possession). His possession is certainly not in the concept of an owner. This is so because as early as 1981, title thereto was registered in the name of the Magpayo Spouses which title was subsequently cancelled when the property was purchased by PBCom in a public auction sale resulting in the issuance of title in favor of the latter in 1985.The Court stressed that possession and ownership are distinct legal concepts. Ownership exists when a thing pertaining to one person is completely subjected to his will in a manner not prohibited by law and consistent with the rights of others. Ownership confers certain rights to the owner, one of which is the right to dispose of the thing by way of sale. Atty. Pedro Garcia and his wife Remedios exercised their right to dispose of what they owned when they sold the subject property to the Magpayo spouses. On the other hand, possession is defined as the holding of a thing or the enjoyment of a right. Literally, to possess means to actually and physically occupy a thing with or without right. Possession may be had in one of two ways: possession in the concept of an owner and possession of a holder. A possessor in the concept of an owner may be the owner himself or one who claims to be so. On the other hand, one who possesses as a mere holder acknowledges in another a superior right which he believes to be ownership, whether his belief be right or wrong.The records show that petitioner occupied the property not in the concept of an owner for his stay was merely tolerated by his parents. Consequently, it is of no moment that petitioner was in possession of the property at the time of the sale to the Magpayo spouses. It was not a hindrance to a valid transfer of ownership. On the other hand, petitioner’s subsequent claim of ownership as successor to his mother’s share in the conjugal asset is belied by the fact that the property was not included in the inventory of the estate submitted by his father to the intestate court. This buttresses the ruling that indeed the property was no longer considered owned by petitioner’s parents.
 The Court upheld the Court of Appeals in holding that the mortgage to PBCom by the Magpayo spouses is valid notwithstanding that the transfer certificate of title over the property was issued to them after the mortgage contract was entered into. Registration does not confer ownership, it is merely evidence of such ownership over a particular property. The deed of sale operates as a formal or symbolic delivery of the property sold and authorizes the buyer to use the document as proof of ownership. All said, the Magpayo spouses were already the owners when they mortgaged the property to PBCom. _____________________________________________________ RODIL ENTERPRISES, INC. vs. COURT OF APPEALS G.R. No. 129609 November 29, 2001 BELLOSILLO, J.: Issue: Whether or not the renewal of contract of lease between Rodil and the Republic is valid. Held: Yes. The owner has the right to enjoy and dispose of a thing, without other limitations than those established by law. Every owner has the freedom of disposition over his property. It is an attribute of ownership, and this rule has no exception. The REPUBLIC being the owner of the disputed property enjoys the prerogative to enter into a lease contract with RODIL in the exercise of its jus disponendi. Hence, as lessor, the REPUBLIC has the right to eject usurpers of the leased property where the factual elements required for relief in an action for unlawful detainer are present. Issue: Whether or not Rodil may validly eject herein respondents even though the former is not in actual possession of the property. Held: Yes. In an action for unlawful detainer the plaintiff need not have been in prior physical possession. Respondents have admitted that they have not entered into any lease contract with the REPUBLIC and that their continued occupation of the subject property was merely by virtue of acquiescence. Since the occupation of respondents was merely tolerated by the

REPUBLIC, the right of possession of the latter remained uninterrupted. It could therefore alienate the same to anyone it chose. Unfortunately for respondents, the REPUBLIC chose to alienate the subject premises to RODIL by virtue of a contract of lease entered into on 18 May 1992. Resultantly, petitioner had the right to file the action for unlawful detainer against respondents as one from whom possession of property has been unlawfully withheld. _____________________________________________________ ISAGUIRRE v. DE LARA G.R. No. 138053 May 31, 2000 Gonzaga – Reyes, J. Issue: Does the mortgagee in an equitable mortgage have the right to retain possession of the property pending actual payment to him of the amount of indebtedness by the mortgagor? Held: No. A mortgage is a contract entered into in order to secure the fulfillment of a principal obligation. Recording the document, in which it appears with the proper Registry of Property, although, even if it is not recorded, the mortgage is nevertheless binding between the parties, constitutes it. Thus, the only right granted by law in favor of the mortgagee is to demand the execution and the recording of the document in which the mortgage is formalized. As a general rule, the mortgagor retains possession of the mortgaged property since a mortgage is merely a lien and title to the property does not pass to the mortgagee. However, even though a mortgagee does not have possession of the property, there is no impairment of his security since the mortgage directly and immediately subjects the property upon which it is imposed, whoever the possessor may be, to the fulfillment of the obligation for whose security it was constituted. If the debtor is unable to pay his debt, the mortgage creditor may institute an action to foreclose the mortgage, whether judicially or extrajudicially, whereby the mortgaged property will then be sold at a public auction and the proceeds there from given to the creditor to the extent necessary to discharge the mortgage loan. Apparently, petitioner’s contention that “to require him to deliver possession of the Property to respondent prior to the full payment of the latter’s mortgage loan would be equivalent to the cancellation of the mortgage is without basis. Regardless of its possessor, the mortgaged property may still be sold, with the prescribed formalities, in the event of the debtor’s default in the payment of his loan obligation. A simple mortgage does not give the mortgagee a right to the possession of the property unless the mortgage should contain some special provision to that effect. Regrettably for petitioner, he has not presented any evidence, other than his own gratuitous statements, to prove that the real intention of the parties was to allow him to enjoy possession of the mortgaged property until full payment of the loan. The trial court correctly issued the writ of possession in favor of respondent. Such writ was but a necessary consequence of affirming the validity of the original certificate of title in the name of respondent Felicitas de Lara, while at the same time nullifying the original certificate of title in the name of petitioner Cornelio Isaguirre. Possession is an essential attribute of ownership; thus, it would be redundant for respondent to go back to court simply to establish her right to possess subject property. _____________________________________________________ SPOUSES CRISTINO and BRIGIDA CUSTODIO and SPOUSES LITO and MARIA CRISTINA SANTOS v. COURT OF APPEALS, HEIRS OF PACIFICO C. MABASA and REGIONAL TRIAL COURT OF PASIG, METRO MANILA, BRANCH 181 G.R. No. 116100 February 9, 1996 REGALADO, J. Issue: Can a damage not amounting to a legal injury suffered by tenants be actionable against the property owner? Held: No. In the case at bar, although there was damage, there was no legal injury. Contrary to the claim of private respondents, petitioners could not be said to have violated the principle of abuse of right. In order that the principle of abuse of right provided in Article 21 of the Civil Code can be applied, it is essential that the following requisites concur: (1) The defendant should have

acted in a manner that is contrary to morals, good customs or public policy; (2) The acts should be willful; and (3) There was damage or injury to the plaintiff. The act of petitioners in constructing a fence within their lot is a valid exercise of their right as owners, hence not contrary to morals, good customs or public policy. The law recognizes in the owner the right to enjoy and dispose of a thing, without other limitations than those established by law.16 It is within the right of petitioners, as owners, to enclose and fence their property. Article 430 of the Civil Code provides that "(e)very owner may enclose or fence his land or tenements by means of walls, ditches, live or dead hedges, or by any other means without detriment to servitudes constituted thereon." _____________________________________________________ ABEJARON vs. NABASA G.R. No. 84831 June 20, 2001 Puno, J. Issue: Whether or not the petitioner had the legal title of ownership in accordance with the applicable law.

GERMAN MANAGEMENT & SERVICES, INC v. CA G.R. No. 76216 - 76217 September 14, 1989 FERNAN, C.J. Issue: Whether or not petitioner may validly invoke the doctrine of self help. Held: No. Both the Municipal Trial Court and the Regional Trial Court have rationalized petitioner's drastic action of bulldozing and destroying the crops of private respondents on the basis of the doctrine of self-help enunciated in Article 429 of the New Civil Code. Such justification is unavailing because the doctrine of selfhelp can only be exercised at the time of actual or threatened dispossession which is absent in the case at bar. When possession has already been lost, the owner must resort to judicial process for the recovery of property. This is clear from Article 536 of the Civil Code which states, "In no case may possession be acquired through force or intimidation as long as there is a possessor who objects thereto. He who believes that he has an action or right to deprive another of the holding of a thing, must invoke the aid of the competent court, if the holder should refuse to deliver the thing." _____________________________________________________

Held: No. Sec. 4 of PD 1073 reads: "Sec. 4. The provision of Section 48(b) and Section 48(c), Chapter VIII, of the Public Land Act, are hereby amended in the sense that these provisions shall apply only to alienable and disposable lands of the public domain which have been in open, continuous, exclusive and notorious possession and occupation by the applicant himself or thru his predecessor-in-interest, under a bona fide claim of acquisition of ownership, since June 12, 1945.” Sec. 48(b) of the Public Land Act, as further amended by P.D. No. 1073, now reads: "(b) Those who by themselves or through their predecessors-ininterest have been in open, continuous, exclusive and notorious possession and occupation of agricultural lands of the public domain, under a bona fide claim of acquisition or ownership, since June 12, 1945, or earlier, immediately preceding the filing of the application for confirmation of title, except when prevented by wars or force majeure. Those shall be conclusively presumed to have performed all the conditions essential to a Government grant and shall be entitled to a certificate of title under the provisions of this chapter." However, as Abejaron’s 30-year period of possession and occupation required by the Public Land Act, ran from 1945 to 1975, prior to the effectivity of PD 1073 in 1977, the requirement that occupation and possession should have started on June 12, 1945, or earlier, does not apply to him. Petitioner claims that he started occupying the disputed land in 1945. At that time, he built a nipa house, a small store, and a fence made of wood to delineate his area. This nipa house was improved in 1949 into a two-storey house. The small store was also made bigger in 1950. The wooden fence was also changed to a fence made of hollow blocks. The two-storey house, bigger store, and hollow-block fence all stand to this day. In 1951, petitioner planted coconut trees near his house. While the petitioner has shown continued existence of these improvements on the disputed land, they were introduced later than January 24, 1947. He has failed to establish the portion of the disputed land that his original nipa house, small store and wooden fence actually occupied as of January 24, 1947. In the absence of this proof, we cannot determine the land he actually possessed and occupied for thirty years which he may acquire under Sec. 48(b) of the Public Land Act. Worthy of notice is the fact that the disputed land was surveyed, subdivided into and identified by lots only in the 1970's. Therefore, prior to the survey, it would be difficult to determine the metes and bounds of the land petitioner claims to have occupied since 1947 in the absence of specific and incontrovertible proof. Finally, as admitted by the petitioner, he has never declared the disputed land for taxation purposes. While tax receipts and tax declarations are not incontrovertible evidence of ownership, they become strong evidence of ownership acquired by prescription when accompanied by proof of actual possession of the property or supported by other effective proof. Even the tax declarations and receipts covering his house do not bolster his case as the earliest of these was dated 1950.

CAISIP v. PEOPLE G.R. No. L-28716 November 18, 1970 Concepcion, C.J. ISSUE: Whether the acts of appellants of stopping Gloria Cabalag from weeding the land and failing to do so to forcibly dragged Cabalag for about 8 meters towards a forested area justified under Article 429 of the Civil Code? HELD: No, their acts cannot be justified under Article 429 of the Civil Code. The Court held that, Art. 429 of our Civil Code, reading: The owner or lawful possessor of a thing has the right to exclude any person from the enjoyment and disposal thereof. For this purpose, he may use such force as may be reasonably necessary to repel or prevent an actual or threatened unlawful physical invasion or usurpation of his property. Upon which appellants rely is obviously inapplicable to the case at bar, for, having been given 20 days from June 6, 1959, within which to vacate Lot 105-A, complainant did not, on June 17, 1959 — or within said period — invade or usurp said lot. She had merely remained in possession thereof, even though the hacienda owner may have become its co-possessor. Appellants did not "repel or prevent in actual or threatened ... physical invasion or usurpation." They expelled Gloria from a property of which she and her husband were in possession even before the action for forcible entry was filed against them on May 17, 1958, despite the fact that the Sheriff had explicitly authorized them to stay in said property up to June 26, 1959, and had expressed the view that he could not oust them therefrom on June 17, 1959, without a judicial order therefor. It is urged, that, by weeding and refusing to leave Lot 105-A, Gloria had committed a crime in the presence of the policemen, despite the aforementioned 20-day period, which, appellants claim, the sheriff had no authority to grant. This contention is manifestly untenable, because: (1) said period was granted in the presence of the hacienda owner's representative, appellant Caisip, who, by not objecting thereto, had impliedly consented to or ratified the act performed by the sheriff; (2) Gloria and her husband were thereby allowed to remain, and had, in fact, remained, in possession of the premises, perhaps together with the owner of the hacienda or his representative, Caisip; (3) the act of removing weeds from the ricefield was beneficial to its owner and to whomsoever the crops belonged, and, even if they had not authorized it, does not constitute a criminal offense; and (4) although Gloria and her husband had been sentenced to vacate the land, the judgment against them did not necessarily imply that they, as the parties who had tilled it and planted thereon, had no rights, of any kind whatsoever, in or to the standing crops, inasmuch as "necessary expenses shall be refunded to every possessor," and the cost of cultivation, production and upkeep has been held to partake of the nature of necessary expenses.

People v. Pletcha G.R. No.19029 June 27, 1977. Bison, J.

constructed and maintained using all reasonable care so that they cannot be dangerous to adjoining landowners and can withstand the usual and expected forces of nature. If the structures cause injury or damage to an adjoining landowner or a third person, the latter can claim indemnification for the injury or damage suffered.

ISSUE: Whether or not Pletcha can properly invoked Article 429.

_____________________________________________________

HELD: Yes. The principle of self-help authorizes the lawful possessor to use force not only to prevent a threatened unlawful invasion or usurpation thereof; it is sort of self-defense. It is lawful to repel force by force. He who merely uses force to defend his possession does not possess by force. The use of such necessary force to protect proprietary or possessory rights constitutes a justifying circumstance under our penal laws.

BACHRACH MOTOR CO., INC., vs. TALISAY-SILAY MILLING CO., THE PHILIPPINE NATIONAL BANK G.R. No. 35223 September 17, 1931 Romualdez, J. Issue: Whether or not the bonus in question is civil fruits?

The appellant need not rush to court to seek redress before reasonably resisting the invasion of property. The situation required immediate action and Article 429 gave him the selfexecutory mechanics of self-defense and self-reliance. _____________________________________________________ Andamo vs. Intermediate Appellate Court G.R. No. 74761 November 6, 1990 Fernan, C.J. Issue: Whether petitioner spouses Andamo can claim damages for destruction caused by respondent’s waterpaths and contrivances on the basis of Articles 2176 and 2177 of the Civil Code on quasi-delicts. Held: Yes. A careful examination of the aforequoted complaint shows that the civil action is one under Articles 2176 and 2177 of the Civil Code on quasi-delicts. All the elements of a quasi-delict are present, to wit: (a) damages suffered by the plaintiff, (b) fault or negligence of the defendant, or some other person for whose acts he must respond; and (c) the connection of cause and effect between the fault or negligence of the defendant and the damages incurred by the plaintiff. Clearly, from petitioner’s complaint, the waterpaths and contrivances built by respondent corporation are alleged to have inundated the land of petitioners. There is therefore, an assertion of a causal connection between the act of building these waterpaths and the damage sustained by petitioners. Such action if proven constitutes fault or negligence which may be the basis for the recovery of damages. It must be stressed that the use of one’s property is not without limitations. Article 431 of the Civil Code provides that “the owner of a thing cannot make use thereof in such a manner as to injure the rights of a third person.” SIC UTERE TUO UT ALIENUM NON LAEDAS. Moreover, adjoining landowners have mutual and reciprocal duties which require that each must use his own land in a reasonable manner so as not to infringe upon the rights and interests of others. Although we recognize the right of an owner to build structures on his land, such structures must be so constructed and maintained using all reasonable care so that they cannot be dangerous to adjoining landowners and can withstand the usual and expected forces of nature. If the structures cause injury or damage to an adjoining landowner or a third person, the latter can claim indemnification for the injury or damage suffered. _____________________________________________________ Andamo vs. Intermediate Appellate Court G.R. No. 74761 November 6, 1990 Fernan, C.J. Issue: Whether a land owner has the absolute right to do anything with his property. Held: No. It must be stressed that the use of one’s property is not without limitations. Article 431 of the Civil Code provides that “the owner of a thing cannot make use thereof in such a manner as to injure the rights of a third person.” SIC UTERE TUO UT ALIENUM NON LAEDAS. Moreover, adjoining landowners have mutual and reciprocal duties which require that each must use his own land in a reasonable manner so as not to infringe upon the rights and interests of others. Although we recognize the right of an owner to build structures on his land, such structures must be so

Held: NO.Article 355 of the Civil Code considers three things as civil fruits: First, the rents of buildings; second, the proceeds from leases of lands; and, third, the income from perpetual or life annuities, or other similar sources of revenue. It may be noted that according to the context of the law, the phrase "u otras analogas" refers only to rent or income, for the adjectives "otras" and "analogas" agree with the noun "rentas," as do also the other adjectives "perpetuas" and "vitalicias." That is why we say that by "civil fruits" the Civil Code understands one of three and only three things, to wit: the rent of a building, the rent of land, and certain kinds of income. As the bonus in question is not rent of a building or of land, the only meaning of "civil fruits" left to be examined is that of "income." Assuming that in broad juridical sense of the word "income" it might be said that the bonus in question is "income" under article 355 of the Civil Code, it is obvious to inquire whether it is derived from the land mortgaged by Mariano Lacson Ledesma to the appellant bank for the benefit of the central; for it is not obtained from that land but from something else, it is not civil fruits of that land, and the bank's contention is untenable. It is to be noted that the said bonus bears no immediate, but only a remote accidental relation to the land mentioned, having been granted as compensation for the risk of having subjected one's land to a lien in favor of the bank, for the benefit of the entity granting said bonus. If this bonus be income or civil fruits of anything, it is income arising from said risk, or, if one chooses, from Mariano Lacson Ledesma's generosity in facing the danger for the protection of the central, but certainly it is not civil fruits or income from the mortgaged property, which, as far as this case is concerned, has nothing to do with it. Hence, the amount of the bonus, according to the resolution of the central granting it, is not based upon the value, importance or any other circumstance of the mortgaged property, but upon the total value of the debt thereby secured, according to the annual balance, which is something quite distinct from and independent of the property referred to. _____________________________________________________ EQUATORIAL REALTY DEVELOPMENT, INC. v. MAYFAIR THEATER, INC. G.R. No. 133879 November 21, 2001 Panganiban, J. Issue: Whether or not Equatorial Realty Development, Inc. is entitled to back rentals from Mayfair Theater, Inc. by virtue of the Contract of Sale executed between Equatorial and Carmelo and Bauermann, Inc. (former owner of the subject property). Held: No. In the case, there was no right of ownership transferred from Carmelo to Equatorial in view of a patent failure to deliver the property to the buyer. By a contract of sale, “one of the contracting parties obligates himself to transfer ownership of and to deliver a determinate thing and the other to pay therefor a price certain in money or its equivalent.” Ownership of the thing sold is a real right, which the buyer acquires only upon delivery of the thing to him “in any of the ways specified in articles 1497 to 1501, or in any other manner signifying an agreement that the possession is transferred from the vendor to the vendee.” This right is transferred, not by contract alone, but by tradition or delivery. And there is said to be delivery if and when the thing sold “is placed in the control and possession of the vendee.” From the peculiar facts of this case, it is clear that petitioner never took actual control and

possession of the property sold, in view of respondent’s timely objection to the sale and the continued actual possession of the property. While the execution of a public instrument of sale is recognized by law as equivalent to the delivery of the thing sold, such constructive or symbolic delivery, being merely presumptive, is deemed negated by the failure of the vendee to take actual possession of the land sold. In the case, Mayfair’s opposition to the transfer of the property by way of sale to Equatorial was a legally sufficient impediment that effectively prevented the passing of the property into the latter's hands. Rent is a civil fruit that belongs to the owner of the property producing it by right of accession. Consequently and ordinarily, the rentals that fell due from the time of the perfection of the sale to petitioner until its rescission by final judgment should belong to the owner of the property during that period. Not having been the owner, Equatorial cannot be entitled to the civil fruits of ownership like rentals of the thing sold. _____________________________________________________ IGNACIO V. HILARIO G.R. No. L-175 April 30, 1946 Moran, CJ ISSUE: Whether or not the plaintiff are entitled to an order of execution since they chose neither to pay defendants for the buildings nor to sell to them the residential lot. HELD: The owner of the building erected in good faith on a land owned by another, is entitled to retain the possession of the land until he is paid the value of his building, under article 453. The owner of the land, upon the other hand, has the option, under article 361, either to pay for the building or to sell his land to the owner of the building. But he cannot, as respondents here did, refuse both to pay for the building and to sell the land and compel the owner of the building to remove it from the land where it is erected. He is entitled to such remotion only when, after having chosen to sell his land, the other party fails to pay for the same. But this is not the case before us. We hold, therefore, that the order of Judge Natividad compelling defendants-petitioners to remove their buildings from the land belonging to plaintiffs-respondents only because the latter chose neither to pay for such buildings not to sell the land, is null and void, for it amends substantially the judgment sought to be executed and is, furthermore, offensive to articles 361 and 453 of the Civil Code. _____________________________________________________ IGNAO V. COURT OF APPEALS G.R. No. 72876 January 18, 1991 FERNAN, C.J. ISSUE #1: Are private respondents builders in good faith on the land in question (thus applying Art. 448 of the Civil Code, although the land in question is still owned by the parties in co-ownership, hence, the applicable provision is Art. 486 of the Civil Code, which was not applied)? RULING #1: It should be noted that prior to partition, all the coowners hold the property in common dominion but at the same time each is an owner of a share which is abstract and undetermined until partition is effected. “An undivided estate is co-ownership by the heirs." As co-owners, the parties may have unequal shares in the common property, quantitatively speaking. But in a qualitative sense, each co-owner has the same right as any one of the other co-owners. Every co-owner is therefore the owner of the whole, and over the whole he exercises the right of dominion, but he is at the same time the owner of a portion which is truly abstract, because until division is effected such portion is not concretely determined. When the co-ownership is terminated by a partition and it appears that the house of an erstwhile co-owner has encroached upon a portion pertaining to another co-owner which was however made in good faith, then the provisions of Article 448 should apply to determine the respective rights of the parties.

ISSUE #2: That, granting for the sake of argument that Art. 448 is applicable, did the respondent Court err when it adjudged the working solution suggested in Grana and Torralba vs. CA. (109 Phil. 260), which is just an opinion by way of passing, and not the judgment rendered therein, which is in accordance with the said provision of the Civil Code? RULING #2: Such ruling contravened the explicit provisions of Article 448 to the effect that "(t)he owner of the land . . . shall have the right to appropriate . . .or to oblige the one who built . . . to pay the price of the land . . . ." The law is clear and unambiguous when it confers the right of choice upon the landowner and not upon the builder and the courts. Thus, in Quemuel vs. Olaes, the Court categorically ruled that the right to appropriate the works or improvements or to oblige the builder to pay the price of the land belongs to the landowner. _____________________________________________________ FILIPINAS COLLEGES, INC., vs. MARIA GARCIA TIMBANG, ET AL. G.R. No. L-12812 September 29, 1959 Barrera, J.: ISSUE: WON the failure of the builder in good faith to pay the price of the land after the owners thereof exercised their option under Article 448 of the Civil Code shall excuse the owners, as highest bidders to pay the auction price and by operation of Article 445, the owners of the land automatically became the owners ipso facto. HELD: NO. Article 448 and 546 of the Civil Code defines the right of the parties in case a person in good faith builds, sows or plants on the land of another. Under the terms of this first article, it is true that the owner of the land has the right to choose between appropriating the building by reimbursing the builder of the value thereof or compelling the builder in good faith to pay for his land. Even this second right cannot be exercised if the value of the land is considerably more than that of the building. In addition to the right of the builder to be paid the value of his improvement, Article 546 gives him the corollary right of retention of the property until he is indemnified by the owner of the land. There is nothing in the language of these two articles which would justify the conclusion of appellants that, upon the failure of the builder to pay the value of the land, when such is demanded by the land-owner, the latter becomes automatically the owner of the improvement under Article 445. The case of Bernardo vs. Bataclan, 66 Phil., 590 cited by appellants is no authority for this conclusion. Although it is true it was declared therein that in the event of the failure of the builder to pay the land after the owner thereof has chosen this alternative, the builder's right of retention provided in Article 546 is lost, nevertheless there was nothing said that as a consequence thereof, the builder loses entirely all rights over his own building. The appellants herein, owners o the land, instead of electing any of the alternative above indicated chose to seek recovery of the value of their land by asking for a writ of execution; levying on the house of the builder; and selling the same in public auction and because they are the highest bidder in their own auction sale, they now claim they acquired title to the building without necessity of paying in cash on account of their bid. In other words, they in effect pretend to retain their land and acquire the house without paying a cent therefor. However, while it is the inveriable practice, that where the successful bidder is the execution creditor himself, he need not pay down the amount of the bid if it does not exceed the amount of his judgement, nevertheless, when their is a claim by a third-party, to the proceeds of the sale superior to his judgment credit, the execution creditor, as successful bidder, must pay in cash the amount of his bid as a condition precedent to the issuance to him of the certificate of sale. In the instant case, the Court of Appeals has already adjudged that appellee Blas is entitled to the payment of the unpaid balance of the purchase price of the school building. Blas has actually a lien on the school building are concerned. The order of the lower court directing the Timbang spouses, as successful bidders, to pay in cash the amount of their bid in the sum of P5,750.00 is therefore correct. With respect to the order of the court declaring appellee Filipinas Colleges, Inc. part owner of the land to the extent of the value of its personal properties sold at public auction in favor of the

Timbang, this Court Likewise finds the same as justified, for such amount represents, in effect, a partial payment of the value of the land. _____________________________________________________ Manotok Realty Inc. vs. Tecson GR L-47475 August 19, 1988 GUTIERREZ, JR., J. ISSUE: Did respondent judge commit grave abuse of discretion in denying the motion to exercise option belonging to the owner of the property under Articles 448 and 546 of the Civil Code? HELD: Yes. The petitioner argues that since the judgment of the trial court has already become final, it is entitled to the execution of the same and that moreover, since the house of the private respondent was gutted by fire, the execution of the decision would now involve the delivery of possession of the disputed area by the private respondent to the petitioner. We find merit in these arguments. When the decision of the trial court became final and executory, it became incumbent upon the respondent judge to issue the necessary writ for the execution of the same. There is, therefore, no basis for the respondent judge to deny the petitioner's motion to avail of its option to appropriate the improvements made on its property. Neither can the respondent judge deny the issuance of a writ of execution because the private respondent was adjudged a builder in good faith or on the ground of "peculiar circumstances which supervened after the institution of this case, like, for instance, the introduction of certain major repairs of and other substantial improvements..." because the option given by law either to retain the premises and pay for the improvements thereon or to sell the said premises to the builder in good faith belongs to the owner of the property. Since the improvements have been gutted by fire, and therefore, the basis for private respondent's right to retain the premises has already been extinguished without the fault of the petitioner, there is no other recourse for the private respondent but to vacate the premises and deliver the same to herein petitioner. _____________________________________________________ BERNARDO VS. BATACLAN G.R. No. L-44606 November 28, 1938 Laurel, J: Issue: Whether or not defendant is a possessor in good faith and has the right to retain the land in accordance with Article 453 of the Civil Code. Held: The Civil Code confirms certain time-honored principles of the law of property. One of these is the principle of accession whereby the owner of property acquires not only that which it produces but that which is united to it either naturally or artificially. Whatever is built, planted or sown on the land of another, and the improvements or repairs made thereon, belong to the owner of the land. Where, however, the planter, builder, or sower has acted in good faith, a conflict of rights arises between the owners and it becomes necessary to protect the owner of the improvements without causing injustice to the owner of the land. In view of the impracticability of creating what Manresa calls a state of "forced coownership," the law has provided a just and equitable solution by giving the owner of the land the option to acquire the improvements after payment of the proper indemnity or to oblige the builder or planter to pay for the land and the sower to pay the proper rent. It is the owner of the land who is allowed to exercise the option because his right is older and because, by the principle of accession, he is entitled to the ownership of the accessory thing. In the case before us, the plaintiff, as owner of the land, chose to require the defendant, as owner of the improvements, to pay for the land. The defendant states that he is a possessor in good faith and that the amount of P2,212 to which he is entitled has not yet been paid to him. Therefore, he says, he has a right to retain the land in accordance with the provisions of article 453 of the Civil Code. We do not doubt the validity of the premises stated. We find, however, that the defendant has lost his right of retention. In obedience to the decision of this court in G.R. No. 37319, the plaintiff expressed his desire to require the defendant to pay for

the value of the land. The said defendant could have become owner of both land and improvements and continued in possession thereof. But he said he could not pay and the land was sold at public auction to Toribio Teodoro. The law, as we have already said, requires no more than that the owner of the land should choose between indemnifying the owner of the improvements or requiring the latter to pay for the land. When he failed to pay for the land, the defendant herein lost his right of retention. The sale at public auction having been asked by the plaintiff himself and the purchase price of P8,000 received by him from Toribio Teodoro, we find no reason to justify a rapture of the situation thus created between them, the defendant-appellant not being entitled, after all, to recover from the plaintiff the sum of P2,212. The judgment of the lower court is accordingly modified by eliminating therefrom the reservation made in favor of the defendant-appellant to recover from the plaintiff the sum of P2,212. In all the respects, the same is affirmed. _____________________________________________________ HEIRS OF RAMON DURANO v. UY G.R. No. 136456 October 24, 2000 GONZAGA-REYES, J. ISSUES (1) Whether or not the heirs of Durano were builders in bad faith (2) Whether or not the Spouses Durano should return the properties and pay indemnity in reparation of the destroyed properties overran by the bulldozers HELD: (1) YES. A purchaser of a parcel of land cannot close his eyes to facts which should put a reasonable man upon his guard, such as when the property subject of the purchase is in possession of persons other than the seller. A buyer who could not have failed to know or discover the land sold to him was in adverse possession of another is a buyer in bad faith. In the same manner the purchase of the property of Durano III from Durano Co. could not have been in good faith because it is not disputed that Durano III had acquired the property with full knowledge of Spouses Uy’s occupancy thereon. Furthermore, there even appears to be undue haste in the conveyance of the property to Durano III, as bulldozing operations by Durano and Co. were still underway when the deed of sale to Durano III was executed on September 15, 1970. There was not even an indication that Durano Co. attempted to transfer the registration in its name before it conveyed to Durano III. (2) YES. Since petitioners knew fully well the defect in their titles, they were correctly held by the Court of Appeals to be builders in bad faith. And since they were in bad faith, the Civil Code provides: Art. 449. He who builds, plants or sows in bad faith on the land of another, loses what is built, planted or sown without right of indemnity. Art. 450. The owner of the land on which anything has been built, planted or sown in bad faith may demand the demolition of the work, or that the planting or sowing be removed, in order to replace things in their former condition at the expense of the person who built, planted or sowed; or he may compel the builder or planter to pay the price of the land, and the sower the proper rent. Art. 451. In the cases of the two preceding articles, the landowner is entitled to damages from the builder, planter or sower.

Based on these provisions, the owner of the land has three alternative rights: (1) to appropriate what has been built without any obligation to pay indemnity therefor, or

(2) to demand that the builder remove what he had built, or (3) to compel the builder to pay the value of the land, or pay the rent in case of the sower. In any case, the landowner is entitled to damages under Article 451, above cited. The right of the owner of the land to recover damages from a builder in bad faith is clearly provided for in Article 451 of the Civil Code. Although said Article 451 does not elaborate on the basis for damages, the Court perceives that it should reasonably correspond with the value of the properties lost or destroyed as a result of the occupation in bad faith, as well as the fruits (natural, industrial or civil) from those properties that the owner of the land reasonably expected to obtain. _____________________________________________________ BALLATAN vs. COURT OF APPEALS G.R. No. 125683 March 2, 1999 Puno, J. ISSUE: WON private respondents Go and Li Ching Yao can be compelled to demolish and remove all the improvements they made on the land of Petitioner whose land area was decreased and deliver the same to the latter. (accion publiciana) HELD: No. All the parties in the case are possessors in good faith and as such Article 448 of the Civil Code shall apply. It provides that the owner of the land on which anything has been built, sown or planted in good faith shall have the right to appropriate as his own the building, planting or sowing, after payment to the builder, planter or sower of the necessary and useful expenses, and in the proper case, expenses for pure luxury or mere pleasure. The owner of the land may also oblige the builder, planter or sower to purchase and pay the price of the land. If the owner chooses to sell his land, the builder, planter or sower must purchase the land, otherwise the owner may remove the improvements thereon. The builder, planter or sower, however, is not obliged to purchase the land if its value is considerably more than the building, planting or sowing. In such case, the builder, planter or sower must pay rent to the owner of the land. If the parties cannot come to terms over the conditions of the lease, the court must fix the terms thereof. The right to choose between appropriating the improvement or selling the land on which the improvement stands to the builder, planter or sower, is given to the owner of the land.” Petitioners, as owners of Lot No. 24, may choose to purchase the improvement made by respondents Go on their land, or sell to respondents Go the subject portion. If buying the improvement is impractical as it may render the Go's house useless, then petitioners may sell to respondents Go that portion of Lot No. 24 on which their improvement stands. If the Go's are unwilling or unable to buy the lot, then they must vacate the land and, until they vacate, they must pay rent to petitioners. Petitioners, however, cannot compel respondents Go to buy the land if its value is considerably more than the portion of their house constructed thereon. If the value of the land is much more than the Go's improvement, then respondents Go must pay reasonable rent. If they do not agree on the terms of the lease, then they may go to court to fix the same. In the event that petitioners elect to sell to respondents Go the subject portion of their lot, the price must be fixed at the prevailing market value at the time of payment. The Court of Appeals erred in fixing the price at the time of taking, which is the time the improvements were built on the land. The time of taking is determinative of just compensation in expropriation proceedings. The instant case is not for expropriation. It is not a taking by the state of private property for a public purpose upon payment of just compensation. This is a case of an owner who has been paying real estate taxes on his land but has been deprived of the use of a portion of this land for years. It is but fair and just to fix compensation at the time of payment. _____________________________________________________

SPOUSES DEL OCAMPO v. ABESIA G.R. No. L-49219 April 15, 1988 Melencio-Herrera, J. Issue: Whether or not Art. 448 of the Civil Code is applicable, upon termination of co-ownership, to a previous co-owner who built in good faith during the co-ownership on the land previously owned in common. Held: Yes. The SC stated that the court a quo correctly held that Article 448 of the Civil Code cannot apply where a co-owner builds, plants or sows on the land owned in common for then he did not build, plant or sow upon land that exclusively belongs to another but of which he is a co-owner. The co-owner is not a third person under the circumstances, and the situation is governed by the rules of co-ownership. However, when, as in this case, the co-ownership is terminated by the partition and it appears that the house of defendants overlaps or occupies a portion of 5 square meters of the land pertaining to plaintiffs, which the defendants obviously built in good faith, then the provisions of Article 448 of the new Civil Code should apply. Manresa and Navarro Amandi agree that the said provision of the Civil Code may apply even when there was co-ownership if good faith has been established. _____________________________________________________ PACIFIC FARMS, INC. v. SIMPLICIO G. ESGUERRA, ET AL. CARRIED LUMBER COMPANY G.R. No. L-21783 November 29, 1969 CASTRO, J. Issue: Whether there exists a materialman's lien over the six buildings in favor of the appellant. Held: Article 447 of the Civil Code1 provides: The owner of the land who makes thereon personally or through another, plantings, constructions or works with the materials of another, shall pay their value; and, if he acted in bad faith, he shall also be obliged to the reparation of damages. The owner of the materials shall have the right to remove them only in case he can do so without injury to the work constructed, or without the plantings, constructions or works being destroyed. However, if the landowner acted in bad faith, the owner of the materials may remove them in any event with a right to be indemnified for damages. The abovequoted legal provision contemplates a principal and an accessory, the land being considered the principal, and the plantings, constructions or works, the accessory. The owner of the land who in good faith — whether personally or through another — makes constructions or works thereon, using materials belonging to somebody else, becomes the owner of the said materials with the obligation however of praying for their value.2 The owner of the materials, on the other hand, is entitled to remove them, provided no substantial injury is caused to the landowner. Otherwise, he has the right to reimbursement for the value of his materials. Although it does not appear from the records of this case that the land upon which the six buildings were built is owned by the appellee, nevertheless, that the appellee claims that it owns the six buildings constructed out of the lumber and construction materials furnished by the appellant, is indubitable. Therefore, applying article 447 by analogy, we perforce consider the buildings as the principal and the lumber and construction materials that went into their construction as the accessory. Thus the appellee, if it does own the six buildings, must bear the obligation to pay for the value of the said materials; the appellant — which apparently has no desire to remove the materials, and, even if it were minded to do so, cannot remove them without necessarily damaging the buildings — has the corresponding right to recover the value of the unpaid lumber and construction materials. Well-established in jurisprudence is the rule that compensation should be borne by the person who has been benefited by the accession.3 No doubt, the appellee benefited from the accession, i.e., from the lumber and materials that went into the construction of the six buildings. It should therefore shoulder the compensation due to the appellant as unpaid furnisher of materials.

PECSON v. COURT OF APPEALS G.R. No. 115814 May 26, 1995 Davide, Jr., J.

PLEASANTVILLE DEVL CORP. v. COURT OF APPEALS G.R. No. 79688 Feb. 1, 1996 Panganiban, J.

Issue: The parties agree that the petitioner was a builder in good faith of the apartment building on the theory that he constructed it at the time when he was still the owner of the lot, and that the key issue in this case is the application of Articles 448 and 456 of the Civil Code.

ISSUE: Whether or not a lot buyer who constructs improvements on the wrong property erroneously delivered by the owner’s agent is a builder in good faith.

Held: By its clear language, Article 448 refers to a land whose ownership is claimed by two or more parties, one of whom has built some works, or sown or planted something. The building, sowing or planting may have been made in good faith or in bad faith. The rule on good faith laid down in Article 526 of the Civil Code shall be applied in determining whether a builder, sower or planter had acted in good faith. Article 448 does not apply to a case where the owner of the land is the builder, sower, or planter who then later loses ownership of the land by sale or donation. Elsewise stated, where the true owner himself is the builder of works on his own land, the issue of good faith or bad faith is entirely irrelevant. Thus in strict point of law, Article 448 is not apposite to the case at bar. Nevertheless, we believe that the provision therein on indemnity may be applied by analogy considering that the primary intent of Article 448 is to avoid a state of forced co-ownership and that the parties, including the two courts below, in the main agree that Articles 448 and 546 of the Civil Code are applicable and indemnity for the improvements may be paid although they differ as to the basis of the indemnity. _____________________________________________________ TECHNOGAS PHILIPPINES, INC. V. CA G.R. No. 108894, 268 SCRA 5 February 10, 1997 Panganiban, J. ISSUE: Whether Petitioner became a builder in bad faith on the presumption that it should know the metes and bounds of its property. HELD: No. When petitioner purchased the land from Pariz Industries, the buildings and other structures were already in existence. The record does not show that petitioner was aware of the encroachment when it came into possession of the property. Likewise unclear is the identity of the actual builder, but it may well be assumed that it was petitioner’s predecessor-in-interest, Pariz Industries. In view of the good faith of both petitioner and private respondent, their respective rights and obligations are to be governed by Article 448 of the Civil Code. In Depra vs. Dumlao, where the builder, planter or sower has acted in good faith, a conflict of rights arises between the owners, and it becomes necessary to protect the owner of the improvements without causing injustice to the owner of the land. In view of the impracticality of creating a state of forced co-ownership, the law has provided a just solution by giving the owner of the land the option to acquire the improvements after payment of the proper indemnity, or to oblige the builder or planter to pay for the land and the sower to pay the proper rent. It is the owner of the land who is authorized to exercise the option, because his right is older, and because, by the principle of accession, he is entitled to the ownership of the accessory thing. Forcible removal of the encroaching structures would only be available should private respondent choose to compel the petitioner to buy the land at a reasonable price but the latter fails to pay such price. This has not taken place, constraining private respondent to: (1) appropriate the encroaching portion of petitioner’s building after payment of proper indemnity, or (2) obliging the latter to buy the lot occupied by the structure. Private respondent cannot exercise a remedy of his own liking. _____________________________________________________

HELD: Yes. Good faith under Article 448 consists in the belief of the builder that the land he is building on is his and his ignorance of any defect or flaw in his title. And as good faith is presumed, petitioner has the burden of proving bad faith on the part of Kee. In the case at bar, Kee had acted in the manner of a prudent man in ascertaining the identity of his property. He went to the subdivision developer’s agent and applied and paid for the relocation of the lot, as well as for the production of a lot plan by CTTEI’s geodetic engineer. Upon Kee’s receipt of the map, his wife went to the subdivision site accompanied by CTTEI’s employee, Octaviano, who authoritatively declared that the land she was pointing to was indeed Lot 8. Kee saw no reason to suspect that there had been a misdelivery. The steps Kee had taken to protect his interests were reasonable. Kee believed that Lot 8 was what he bought from petitioner at the time he built improvements on it. He was not aware that the lot delivered to him was not Lot 8 but Lot 9. Thus, Kee’s good faith. Petitioner failed to prove otherwise. _____________________________________________________ GEMINIANO v COURT OF APPEALS G.R. No. 120303 July 24, 1996 DAVIDE, Jr., J. ISSUE: Whether the private respondents are builders in good faith or mere lessees? HELD: No. Being mere lessees, the private respondents knew that their occupation of the premises would continue only for the life of the lease. Plainly, they cannot be considered as possessors nor builders in good faith. In a plethora of cases, this Court has held that Article 448 of the Civil Code, in relation to Article 546 of the same Code, which allows full reimbursement of useful improvements and retention of the premises until reimbursement is made, applies only to a possessor in good faith, i.e., one who builds on land with the belief that he is the owner thereof. It does not apply where one's only interest is that of a lessee under a rental contract; otherwise, it would always be in the power of the tenant to "improve" his landlord out of his property. _____________________________________________________ EULOGIO AGUSTIN vs. INTERMEDIATE APPELLATE COURT G.R. Nos. L-66075-76 July 5, 1990 GRIÑO-AQUINO, J. ISSUES: a) Whether or not the Court of Appeals erred in declaring that the land in question had become part of private respondents' estate as a result of accretion. b) Whether or not the Court of Appeals erred in declaring that the ownership of private respondents over the accretion is not affected by the sudden and abrupt change in the course of the Cagayan River when it reverted to its old bed. Held: The petition is unmeritorious and must be denied. a) The finding of the Court of Appeals that there had been accretions to the lots of the private respondents who did not lose the ownership of such accretions even after they were separated from the principal lots by the sudden change of course of the river, is a finding of fact which is conclusive on this Court. That finding is supported by Art. 457 of the New Civil Code which provides: Art. 457. To the owners of lands adjoining the banks of rivers belong the accretion which they gradually receive from the effects of the current of the waters.

Accretion benefits a riparian owner when the following requisites are present: (1) that the deposit be gradual and imperceptible; (2) that it resulted from the effects of the current of the water; and (3) that the land where accretion takes place is adjacent to the bank of a river (Republic vs. CA, 132 SCRA 514). b) The private respondents' ownership of the accretion to their lands was not lost upon the sudden and abrupt change of the course of the Cagayan River in 1968 or 1969 when it reverted to its old 1919 bed, and separated or transferred said accretions to the other side (or eastern bank) of the river. Articles 459 and 463 of the New Civil Code apply to this situation. Art. 459. Whenever the current of a river, creek or torrent segregates from an estate on its bank a known portion of land and transfers it to another estate, the owner of the land to which the segregated portion belonged retains the ownership of it, provided that he removes the same within two years. Art. 463. Whenever the current of a river divides itself into branches, leaving a piece of land or part thereof isolated, the owner of the land retains his ownership. He also retains it if a portion of land is separated from the estate by the current. In the case at bar, the sudden change of course of the Cagayan River as a result of a strong typhoon in 1968 caused a portion of the lands of the private respondents to be "separated from the estate by the current." The private respondents have retained the ownership of the portion that was transferred by avulsion to the other side of the river. _____________________________________________________ CUREG V. INTERMEDIATE APPELLATE COURT G.R. No. 73465 September 7, 1989 MEDIALDEA, J. ISSUE: Whether or not an accretion automatically belongs to the adjacent land owner who has an Original Certificate of Title and consider such accretion deemed registered. HELD: No. The "subject land" is an alluvial deposit left by the northward movement of the Cagayan River and pursuant to Article 457 of the New Civil Code: To the owners of land adjoining the banks of river belong the accretion which they gradually receive from the effects of the current of the waters. The increase in the area of petitioners' land, being an accretion left by the change of course or the northward movement of the Cagayan River does not automatically become registered land just because the lot which receives such accretion is covered by a Torrens title. (See Grande v. Court of Appeals, L-17652, June 30, 1962). As such, it must also be placed under the operation of the Torrens System. _____________________________________________________ Viajar v. CA G.R.No. 77294 December 12, 1988 Medialdea, J.: Issue: Whether the change in the course of the Suague River was sudden as claimed by the plaintiffs or gradual as contended by the defendants. Assuming arguendo it was gradual, whether or not the plaintiffs are still entitled to Lot ‘B' appearing in Exhibit "4" and to one-half (½) of Lot "A," also indicated in Exhibit "4" Held: The presumption is that the change in the course of the river was gradual and caused by accretion and erosion. The defendants have sufficiently established that for many years the Suague River overflowed its banks yearly and the property of the defendant gradually received deposits of soil from the effects of the current of the river. The consequent increase in the area of Lot No. 7511 due to alluvion or accretion was possessed by the defendants whose tenants plowed and planted the same with coin and tobacco.

The quondam river bed had been filled by accretion through the years. The land is already plain and there is no indication on the ground of any abandoned river bed. The river bed is definitely no longer discernible now. What used to be the old river bed (Lot A) is in level with Lot No. 7511. So are the two other areas to the East. (Lots B and C) Lots A, B and C are still being cultivated. Under the law, accretion which the banks or rivers may gradually receive from the effects of the current of the waters becomes the property of the owners of the lands adjoining the banks. (Art. 366, Old Civil Code; Art. 457, New Civil Code which took effect on August 30, 1950 [Lara v. Del Rosario, 94 Phil. 778]. Therefore, the accretion to Lot No. 7511 which consists of Lots A and B (see Exhs. 'C' and '4') belongs to the defendants. _____________________________________________________ VDA. DE NAZARENO v. COURT OF APPEALS G.R. No. 98045 June 26, 1996 ROMERO, J. Issue: Whether or not the subject land is private land being an accretion to petitioner’s titled property Held: No. In the case of Meneses v. CA, this Court held that accretion, as a mode of acquiring property under Art. 457 of the Civil Code, requires the concurrence of these requisites : (1) that the deposition of soil or sediment be gradual and imperceptible; (2) that it be the result of the action of the waters of the river (or sea); and (3) that the land where accretion takes place is adjacent to the banks of rivers (or the sea coast). These are called the rules on alluvion which if present in a case, give to the owners of lands adjoining the banks of rivers or streams any accretion gradually received from the effects of the current of waters. For petitioners to insist on the application of these rules on alluvion to their case, the above-mentioned requisites must be present. However, they admit that the accretion was formed by the dumping of boulders, soil and other filling materials on portions of the Balacanas Creek and the Cagayan River bounding their land. It cannot be claimed, therefore, that the accumulation of such boulders, soil and other filling materials was gradual and imperceptible, resulting from the action of the waters or the current of the Balacanas Creek and the Cagayan River. In Hilario v. City of Manila, this Court held that the word "current" indicates the participation of the body of water in the ebb and flow of waters due to high and low tide. Petitioners' submission not having met the first and second requirements of the rules on alluvion, they cannot claim the rights of a riparian owner. It is this Court's irresistible conclusion, therefore, that the accretion was man-made or artificial. In Republic v. CA, this Court ruled that the requirement that the deposit should be due to the effect of the current of the river is indispensable. This excludes from Art. 457 of the Civil Code all deposits caused by human intervention. Putting it differently, alluvion must be the exclusive work of nature. Thus, in Tiongco v. Director of Lands, et al., where the land was not formed solely by the natural effect of the water current of the river bordering said land but is also the consequence of the direct and deliberate intervention of man, it was deemed a man-made accretion and, as such, part of the public domain. In the case at bar, the subject land was the direct result of the dumping of sawdust by the Sun Valley Lumber Co. consequent to its sawmill 
 operations. Even if this Court were to take into consideration petitioners' submission that the accretion site was the result of the late Antonio Nazareno's labor consisting in the dumping of boulders, soil and other filling materials into the Balacanas Creek and Cagayan River bounding his land, the same would still be part of the public domain. _____________________________________________________ HEIRS OF NAVARRO v. IAC G.R. No. 68166 February 12, 1997 Hermosisima, Jr., J. ISSUE: Can the petitioners rightfully claim ownership over the land through the principle of accretion?

HELD: The disputed property was brought forth by both the withdrawal of the waters of Manila Bay and the accretion formed on the exposed foreshore land by the action of the sea which brought soil and sand sediments in turn trapped by the palapat and bakawan trees planted thereon by petitioner Sulpicio Pascual in 1948. Accretion as a mode of acquiring property under said Article 457, requires the concurrence of the following requisites: (1) that the accumulation of soil or sediment be gradual and imperceptible; (2) that it be the result of the action of the waters of the river; and (3) that the land where the accretion takes place is adjacent to the bank of the river. Accretion is the process whereby the soil is deposited, while alluvium is the soil deposited on the estate fronting the river bank; the owner of such estate is called the riparian owner. Riparian owners are, strictly speaking, distinct from littoral owners, the latter being owners of lands bordering the shore of the sea or lake or other tidal waters. The alluvium, by mandate of Article 457 of the Civil Code, is automatically owned by the riparian owner from the moment the soil deposit can be seen but is not automatically registered property, hence, subject to acquisition through prescription by third persons. The disputed land is an accretion not on a river bank but on a sea bank, or on what used to be the foreshore of Manila Bay which adjoined private respondents' own tract of land on the northern side. As such, the applicable law is not Article 457 of the Civil Code but Article 4 of the Spanish Law of Waters of 1866. Article 4 of the Spanish Law of Waters of August 3, 1866 provides as follows: "Lands added to the shores by accretions and alluvial deposits caused by the action of the sea, form part of the public domain. When they are no longer washed by the waters of the sea and are not necessary for purposes of public utility, or for the establishment of special industries, or for the coast-guard service, the Government shall declare them to be the property of the owners of the estates adjacent thereto and as increment thereof." As part of the public domain, the herein disputed land is intended for public use, and "so long as the land in litigation belongs to the national domain and is reserved for public use, it is not capable of being appropriated by any private person, except through express authorization granted in due form by a competent authority." Only the executive and possibly the legislative departments have the right and the power to make the declaration that the lands so gained by action of the sea is no longer necessary for purposes of public utility or for the cause of establishment of special industries or for coast guard services. CO-OWNERSHIP DEL BANCO v. INTERMEDIATE APPELLATE COURT G.R. No. 72694 December 1, 1987 PARAS, J. Issue: Can mere agreement to subdivide property terminate coownership? Held: No. It is not enough that the co-owners agree to subdivide the property. They must have a subdivision plan drawn in accordance with which they take actual and exclusive possession of their respective portions in the plan and titles issued to each of them accordingly (Caro vs. Court of Appeals, 113 SCRA 10 [1982]). The mechanics of actual partition should follow the procedure laid down in Rule 69 of the Rules of Court. Maganon vs. Montejo, 146 SCRA 282 [1986]). Neither can such actual possession and enjoyment of some portions of the Island by some of the petitioners herein be considered a repudiation of the co-ownership. It is undisputed that the Cagbalite Island was purchased by the original co-owners as a common property and it has not been proven that the Island had been partitioned among them or among their heirs. While there is co-ownership, a co-owner's possession of his share is copossession which is linked to the possession of the other coowners (Gatchalian vs. Arlegui, 75 SCRA 234 [1977]).

Furthermore, no prescription shall run in favor of a co-owner against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership (Valdez vs. Olonga, 51 SCRA 71 [1973], Tero vs. Tero, 131 SCRA 100 [1984]). Coowners cannot acquire by prescription the share of the other coowners, absent a clear repudiation of the co-ownership clearly communicated to the other co-owners (Mariano vs. De Vega, 148 SCRA 342 [1987]). An action for partition does not prescribe. Article 403 of the Old Civil Code, now Article 497, provides that the assignees of the coowners may take part in the partition of the common property, and Article 400 of the Old Code, now Article 494 provides that each co-owner may demand at any time the partition of the common property, a provision which implies that the action to demand partition is imprescriptible or cannot be barred by laches (Budlong vs. Pondoc, 79 SCRA 24 [1977]). An action for partition does not lie except when the co-ownership is properly repudiated by the coowner (Jardin vs. Hollasco, 117 SCRA 532 [1982]). _____________________________________________________ Vicenta Ortiz Pardell and Ricardo Pardell VS. Matilde Ortiz Bartolome and Gaspar Bartolome G.R. No. L-4656 18 November 18, 1912 Torres, J: ISSUE: Whether or not the respondent spouses should pay rent to the petitioner, the respondent wife’s sister and co-owner of the property in question, for the use of the: a) 2nd floor for dwelling and b) 1st floor for the husband’s office.

HELD: Respondents should pay rent for the use of the 1st floor but not for the use of the 2nd floor. Article 394 of the Civil Code prescribes: Each co-owner may use the things owned in common, provided he uses them in accordance with their object and in such manner as not to injure the interests of the community nor prevent the coowners from utilizing them according to their rights. Respondents occupied the upper story, designed for use as a dwelling, in the house of joint ownership; but the record shows no proof that there was any detriment to the interest of the community property, nor that she prevented the petitioner from utilizing the said upper story according to her rights. The respondent husband occupied for four years the lower floor of the same house as an office for the justice of the peace, a position which he held in the capital of that province, strict justice, requires that he pay his sister-in-law, the plaintiff, one half of the monthly rent which the said quarters could have produced, had they been leased to another person. This conclusion as to Bartolome's liability results from the fact that, even as the husband of the defendant co-owner of the property, he had no right to occupy and use gratuitously the said part of the lower floor of the house in question, where he lived with his wife, to the detriment of the plaintiff Vicenta who did not receive one-half of the rent which those quarters could and should have produced, had they been occupied by a stranger, in the same manner that rent was obtained from the rooms on the lower floor that were used as stores. _____________________________________________________ CARO VS. COURT OF APPEALS G.R. No. L-46001 March 25, 1982 Guerrero, J. ISSUES: 1.

Is an oral agreement of partition valid?

2. Is the right of legal redemption still available when the coownership is already terminated? HELD: 1. YES. An agreement of partition, though oral, is valid and consequently binding upon the parties.

2. NO. Inasmuch as the purpose of the law in establishing the right of legal redemption between co-owners is to reduce the number of participants until the community is done away with, once the property is subdivided and distributed among the co-owners, the community has terminated and there is no reason to sustain any right of legal redemption. The Court further held that the effect is no different with respect to a conveyance which took place before the partition agreement and approval by the court. _____________________________________________________ Bailon-Casilao v. CA G.R. No. 78178 April 15, 1988 Cortes, J.: Issues: 1. What is the effect of a sale by one or more co-owners of the entire property held in common without the consent of all the coowners? 2. What is the appropriate remedy of the aggrieved co-owners in case of such sale by a co-owner? Held: 1. The pertinent civil code provision is Art. 493. The Court ruled that even if a co-owner sells the whole property as his, the sale will affect only his own share but not those of the other co-owners who did not consent to the sale. This is because under the aforementioned codal provision, the sale or other disposition affects only his undivided share and the transferee gets only what would correspond to his grantor in the partition of the thing owned in common. From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided share, a sale of the entire property by one co-owner without the consent of the other co-owners is not null and void. However, only the rights of the co-owner-seller are transferred, thereby making the buyer a co-owner of the property.

2. The proper action in cases like this is not for the nullification of the sale or for the recovery of possession of the thing owned in common from the third person who substituted the co-owner or coowners who alienated their shares, but the DIVISION of the common property as if it continued to remain in the possession of the co-owners who possessed and administered it. Thus, it is now settled that the appropriate recourse of co-owners in cases where their consent were not secured in a sale of the entire property as well as in a sale merely of the undivided shares of some of the co-owners is an action for PARTITION under Rule 69 of the Revised Rules of Court. Neither recovery of possession nor restitution can be granted since the defendant buyers are legitimate proprietors and possessors in joint ownership of the common property claimed.

adversely to the plaintiff, the court should not dismiss the plaintiffs action for partition but, on the contrary and in the exercise of its general jurisdiction, resolve the question of whether the plaintiff is co-owner or not. Should the trial court find that the plaintiff was unable to sustain his claimed status as co-owner, or that the defendants are or have become the sole and exclusive owners of the property involved, the court will necessarily have to dismiss the action for partition. This result would be reached, not because the wrong action was commenced by the plaintiff, but rather because the plaintiff having been unable to show co-ownership rights in himself, no basis exists for requiring the defendants to submit to partition the property at stake. If, upon the other hand, the court after trial should find the existence of co-ownership among the parties litigant, the court may and should order the partition of the property in the same action. Judgment for one or the other party being on the merits, the losing party may then appeal the same. In either case, however, it is quite unnecessary to require the plaintiff to file another action, separate and independent from that for partition originally instituted. Functionally, an action for partition may be seen to be at once an action for declaration of coownership and for segregation and conveyance of a determinate portion of the property involved. The question of prescription also needs to be addressed in this connection. It is sometimes said that "the action for partition of the thing owned in common (actio communi dividendo or actio familiae erciscundae) does not prescribe." This statement bears some refinement. In the words of Article 494 of the Civil Code, "each coowner may demand at any time the partition of the thing owned in common, insofar as his share is concemed." No matter how long the co-ownership has lasted, a co-owner can always opt out of the co-ownership, and provided the defendant co-owners or co-heirs have theretofore expressly or impliedly recognized the coownership, they cannot set up as a defense the prescription of the action for partition. But if the defendants show that they had previously asserted title in themselves adversely to the plaintiff and for the requisite period of time, the plaintiffs right to require recognition of his status as a co-owner will have been lost by prescription and the court cannot issue an order requiring partition. _____________________________________________________ DE LIMA V. CA G.R. No. L-46296 September 24, 1991 Medialdea, J: Issue: Is petitioner’s action for partition already barred by the statutory period provided by law which would then enable private respondent (Galileo De Lima) to perfect his claim of ownership by acquisitive prescription?

_____________________________________________________

Held: Yes. As a rule possession by a co-owner will not be presumed adverse to others, but will be held to benefit all. It is understood that a co-heir or co-owner who is in possession of an inheritance pro-indiviso for himself and in representation of other co-owners or co-heirs is regarded as a depository, lessee or trustee. No prescription shall therefore run in favor of a co-owner as against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership.

ROQUE v. INTERMEDIATE APPELLATE COURT G.R. No. 75886 August 30, 1988 Feliciano, J.

However, from the moment one of the co-owners claims that he is the absolute and exclusive owner of the properties and denies the share of the others, the question involved is no longer of partition but of ownership.

Issue: Whether or not an action for partition will not prosper from the moment an alleged co-owner asserts an adverse title. Held: No. An action for partition-which is typically brought by a person claiming to be co-owner of a specified property against a defendant or defendants whom the plaintiff recognizes to be coowners — may be seen to present simultaneously two principal issues. First, there is the issue of whether the plaintiff is indeed a co-owner of the property sought to be partitioned. Second, assuming that the plaintiff successfully hurdles the first issue, there is the secondary issue of how the property is to be divided between plaintiff and defendant(s). Should the trial court find that the defendants do not dispute the status of the plaintiff as co-owner, the court can forthwith proceed to the actual partitioning of the property involved. In case the defendants assert in their Answer exclusive title in themselves

Evidence shows that Galileo Delima obtained the issuance of a new title in his name to the exclusion of his co-heirs. The issuance of this new title constituted an open and clear repudiation of the trust or co-ownership, and the lapse of ten years of adverse possession by Galileo Delima was sufficient to vest title in him by prescription. Hence, when petitioners filed their action for reconveyance and/or to compel partition on February 29, 1968, such action was already barred by prescription. _____________________________________________________ AGUILAR vs. COURT OF APPEALS G.R. No. 76351 October 29, 1993 Bellosillo, J.; Issue: When may a co-ownership be dissolved?

Whether a co-owner of a property can be held liable for payment of rentals on a property co-owned by him. Held: Article 494 of the Civil Code provides that no co-owner shall be obliged to remain in the co-ownership, and that each co-owner may demand at any time partition of the thing owned in common insofar as his share is concerned. Corollary to this rule, Art. 498 of the Code states that whenever the thing is essentially, indivisible and the co-owners cannot agree that it be, allotted to one of them who shall indemnify the others, it shall be sold and its proceeds accordingly distributed. This is resorted to (1) when the right to partition the property is invoked by any of the co-owners but because of the nature of the property it cannot be subdivided or its subdivision would prejudice the interests of the co-owners, and (b) the co-owners are not in agreement as to who among them shall be allotted or assigned the entire property upon proper reimbursement of the co-owners. In one case, this Court upheld the order of the trial court directing the holding of a public sale of the properties owned in common pursuant to Art. 498 of the Civil Code. However, being a co-owner respondent has the right to use the house and lot without paying any compensation to petitioner, as he may use the property owned in common long as it is in accordance with the purpose for which it is intended and in a manner not injurious to the interest of the other co-owners. Each co-owner of property held pro indiviso exercises his rights over the whole property and may use and enjoy the same with no other limitation than that he shall not injure the interests of his coowners, the reason being that until a division is made, the respective share of each cannot be determined and every coowner exercises, together with his co-participants joint ownership over the pro indiviso property, in addition to his use and enjoyment of the same. _____________________________________________________ CLAUDIO MEMORIAL COLLEGE vs. COURT OF APPEALS G.R. No. 124262 October 12, 1999 Quisumbing, J.

LUCIO ROBLES vs. COURT OF APPEALS G.R. No. 123509 March 14, 2000 PANGANIBAN, J.: Issue: Whether or not a title may prescribe in favor of a co-owner (Hilario). Held: There is merit to the contention of the petitioners that Hilario mortgaged the disputed property to the Rural Bank of Cardona in his capacity as a mere co-owner thereof. The said transaction did not divest them of title to the property at the time of the institution of the Complaint for quieting of title. Maintaining that as co-owners of the subject property, they did not agree to the real estate mortgage constituted on it, petitioners insist that their shares therein should not have been prejudiced by Hilario's actions. Hilario effected no clear and evident repudiation of the coownership. It is a fundamental principle that a co-owner cannot acquire by prescription the share of the other co-owners, absent any clear repudiation of the co-ownership. In order that the title may prescribe in favor of a co-owner, the following requisites must concur: (1) the co-owner has performed unequivocal acts of repudiation amounting to an ouster of the other co-owners; (2) such positive acts of repudiation have been made known to the other co-owner; and (3) the evidence thereof is clear and convincing. Hilario did not have possession of the subject property; neither did he exclude the petitioners from the use and the enjoyment thereof, as they had indisputably shared in its fruits. Likewise, his act of entering into a mortgage contract with the bank cannot be construed to be a repudiation of the co-ownership. As absolute owner of his undivided interest in the land, he had the right to alienate his share, as he in fact did. Neither should his payment of land taxes in his name, as agreed upon by the co-owners, be construed as a repudiation of the co-ownership. The assertion that the declaration of ownership was tantamount to repudiation was belied by the continued occupation and possession of the disputed property by the petitioners as owners. _____________________________________________________

Issue: Whether or not petitioner is entitled to ownership of the entire property by virtue of prescription? Held: No. On the issue of prescription, we have ruled that even if a co-owner sells the whole property as his, the sale will affect only his own share but not those of the other co-owners who did not consent to the sale.[8] Under Article 493 of the Civil Code, the sale or other disposition affects only the seller’s share pro indiviso, and the transferee gets only what corresponds to his grantor’s share in the partition of the property owned in common. Since a co-owner is entitled to sell his undivided share, a sale of the entire property by one co-owner without the consent of the other co-owners is not null and void. However, only the rights of the co-owner/seller are transferred, thereby making the buyer a co-owner of the property. The proper action in a case like this, is not for the nullification of the sale, or for the recovery of possession of the property owned in common from the third person, but for division or partition of the entire property if it continued to remain in the possession of the co-owners who possessed and administered it.[9] Such partition should result in segregating the portion belonging to the seller and its delivery to the buyer. In the light of the foregoing, petitioner’s defense of prescription against an action for partition is a vain proposition. Pursuant to Article 494 of the Civil Code, “no co-owner shall be obliged to remain in the co-ownership. Such co-owner may demand at anytime the partition of the thing owned in common, insofar as his share is concerned.” In Budlong vs. Bondoc,[10] this Court has interpreted said provision of law to mean that the action for partition is imprescriptible. It cannot be barred by prescription. For Article 494 of the Civil Code explicitly declares: “No prescription shall lie in favor of a co-owner or co-heirs as long as he expressly or impliedly recognizes the co-ownership.”

POSSESSION RIZAL CEMENT CO. v. VILLAREAL G.R. No. L-30272 February 28, 1985 Cuevas, J. Issue: How is possession acquired? Held: Being an attribute of ownership, appellants' possession of the land in question goes far to tip the scale in their favor. The right to possess flows from ownership. No person should suffer adverse possession by another of what belongs to him. Were the oppositor - appellee rightful owner of the land in question, it would not have allowed the tenants to cultivate the land and give the owner's share to appellants and/or their predecessors. It would have opposed the survey for applicants' vendors but did not as shown in the surveyor's certificate. Very significantly petitioner did not present any witness in actual possession of the land in question. As aptly found by the appellate court, respondents possess the property in the concept of an owner. Possession is acquired by the material occupation of a thing or the exercise of a right or by the fact it is subject to the action of our will, or by the proper acts and legal formalities established for acquiring such right. Petitioner's evidence, consisting of tax receipts, tax declaration and survey plan are not conclusive and indisputable basis of one's ownership of the property in question. Assessment alone is of little value as proof of title. Mere tax declaration does not vest ownership of the property upon the declarant. Settled is the rule that neither tax receipts nor declaration of ownership for taxation purposes alone constitutes sufficient evidence of ownership or of the right to possess realty. They must be supported by other effective proofs. Neither can the survey plan or technical descriptions prepared at the instance of the party concerned be considered in his favor, the same being self-serving.

WONG v. CARPIO G.R. No. L-50264 October 21, 1991 BIDIN, J. Issue: Are periodic visits to gather coconuts sufficient to prove prior possession? Held: Yes. It should be stressed that "possession is acquired by the material occupation of a thing or the exercise of a right, or by the fact that it is subject to the action of our will, or by the proper acts and legal formalities for acquiring such right." (Art. 531, Civil Code; Rizal Cement Co., Inc. vs. Villareal, 135 SCRA 15 [1985]); and that the execution of a sale thru a public instrument shall be equivalent to the delivery of the thing, unless there is stipulation to the contrary . . . . If, however, notwithstanding the execution of the instrument, the purchaser cannot have the enjoyment and material tenancy of the thing and make use of it herself, because such tenancy and enjoyment are opposed by another, then delivery has not been effected. _____________________________________________________ SOMODIO vs. COURT OF APPEALS G.R. No. 82680 August 15, 1994 Quiason, J.: Issue: Whether or not the petitioner had prior possession of the subject property. Held: Yes. Petitioner took possession of the property in 1974 when he planted various kinds of tress on it. In 1976, he started the construction of a building on the property. It is immaterial that the building was unfinished and that he left for Kidapawan and visited the property intermittently. Possession in the eyes of the law does not mean that a man has to have his feet on every square meter of ground before it can be said that he is in possession (Ramos v. Director of Lands, 39 Phil. 175 [1918]). It is enough that petitioner was able to subject the property to the action of his will. Even if the Court of Appeals is correct in its finding that petitioner started introducing improvements on the land only in 1981, he still had priority of possession because respondent Purisima entered the premises only in 1983. _____________________________________________________ MAGLUCOT-AW v. MAGLUCOT G.R. No. 132518 March 28, 2000 KAPUNAN, J.: Issue: Whether or not the respondents are estopped from questioning the title to partition. Held: Yes. Parties to a partition proceeding, who elected to take under partition, and who took possession of the portion allotted to them, are estopped from questioning the title to partition allotted to another party. Here, respondents already occupied the lots in accordance with the sketch plan. This occupation continued until this action was filed. They cannot now be heard to question the possession and ownership of the other co-owners who took exclusive possession of Lot 1639-D also in accordance with the sketch plan. The payment of rentals by respondents reveal that they are mere lessees. As such, the possession of respondents over Lot No. 1639-D is that of a holder and not in the concept of an owner. One who possesses as a mere holder acknowledges in another a superior right which he believes to be ownership, whether his belief be right or wrong. Since the possession of respondents were found to be that of lessors of petitioners, it goes without saying that the latter were in possession of Lot No. 1639-D in the concept of an owner from 1952 up to the time the present action was commenced. _____________________________________________________

CEQUEÑA v. BOLANTE G.R. No. 137944 April 6, 2000 Panganiban, J.

ISSUE:.Between petitioners and respondent, who is the preferred possessor/s under Article 538 of the Civil Code? HELD: Respondent is the preferred possessor under Article 538 of the Civil Code. The Court conceded that despite their dispossession in 1985, the petitioners did not lose legal possession because possession cannot be acquired through force or violence. To all intents and purposes, a possessor, even if physically ousted, is still deemed the legal possessor. Indeed, anyone who can prove prior possession, regardless of its character, may recover such possession. However, possession by the petitioners does not prevail over that of the respondent. Possession by the former before 1985 was not exclusive, as the latter also acquired it before 1985. The records show that the petitioners' father and brother, as well as the respondent and her mother were simultaneously in adverse possession of the land. Before 1985, the subject land was occupied and cultivated by the respondent's father (Sinforoso), who was the brother of petitioners' father (Margarito), as evidenced by Tax Declaration No. 26425. When Sinforoso died in 1930, Margarito took possession of the land and cultivated it with his son Miguel. At the same time, respondent and her mother continued residing on the lot. When respondent came of age in 1948, she paid realty taxes for the years 1932-1948. Margarito declared the lot for taxation in his name in 1953 and paid its realty taxes beginning 1952. When he died, Miguel continued cultivating the land. As found by the CA, the respondent and her mother were living on the land, which was being tilled by Miguel until 1985 when he was physically ousted by the respondent. Based on Article 538 of the Civil Code, the respondent is the preferred possessor because, benefiting from her father's tax declaration of the subject lot since 1926, she has been in possession thereof for a longer period. On the other hand, petitioners' father acquired joint possession only in 1952. _____________________________________________________ Aragon v. Insular Government G.R. No. 6019, 19 Phil. 223 March 25, 1911 CARSON, J.: ISSUE: Whether or not applicant is entitled to possess the subject land. HELD: The facts of the case conclusively establish the right of possession and ownership of the applicants. Article 446 of the Civil Code is as follows: Every possessor has a right to be respected in his possession; and should he be disturbed therein, he must be protected or possession must be restored to him by the means established in the laws of procedure. ART. 460. The possessor may lose his possession — 1. By the abandonment of the thing. 2. By transfer to another for a good or valuable consideration. 3. By the destruction or total loss of the thing or by the thing becoming unmarketable. 4. By the possession of another, even against the will of the former possessor, if the new possession has lasted more than one year. Under these provisions of the code it seems quite clear that if the Government is justified in disturbing the possession of the applicants, it can only be on the ground that they have abandoned their property, or that it has been totally destroyed and has now become a part of the public domain by the erosive action of the

sea. It is quite clear that applicants have never abandoned their possession under a claim of ownership of this land. Doubtless the property has been injured by the erosive action of the sea. Doubtless the owners in order to profitably enjoy the possession of this property will be compelled to make some relatively small expenditures by way of a "fill" or a retaining wall. But the actual condition of the property as it appears from the record makes a claim that it has been totally lost or destroyed preposterous and wholly untenable. We need hardly add that if the applicants have not lost their right of possession, the Government's claim of ownership, on the ground that this is a part of the playa (shore) of Manila Bay, necessarily falls to the ground. Our ruling in this case is merely that it affirmatively appears that the owners of the land in question have never in fact nor in intent abandoned it, and that keeping in mind its location and actual condition it cannot be said to have been totally destroyed for the purposes for which it was held by them, so as to have become a part of the playa(shore) of the Bay of Manila. _____________________________________________________ CATHOLIC VICAR APOSTOLIC OF THE MOUNTAIN PROVINCE v. CA G.R. No. 80294-95 September 21, 1988 GANCAYCO, J.: Issue: Whether the petitioner has acquired the lots through acquisitive prescription Held: No. Private respondents were able to prove that their predecessors' house was borrowed by petitioner Vicar after the church and the convent were destroyed. They never asked for the return of the house, but when they allowed its free use, they became bailors in commodatum and the petitioner the bailee. The bailees' failure to return the subject matter of commodatum to the bailor did not mean adverse possession on the part of the borrower. The bailee held in trust the property subject matter of commodatum. The adverse claim of petitioner came only in 1951 when it declared the lots for taxation purposes. The action of petitioner Vicar by such adverse claim could not ripen into title by way of ordinary acquisitive prescription because of the absence of just title. _____________________________________________________ EDCA PUBLISHING & DISTRIBUTING CORP. vs. SANTOS G.R. No. 80298 April 26, 1990 CRUZ, J. ISSUE: Whether or not the petitioner may seize the books from private respondents because it has been unlawfully deprived of the books due to the dishonored check issued by the impostor. HELD: NO. Ownership in the thing sold shall not pass to the buyer until full payment of the purchase only if there is a stipulation to that effect. Otherwise, the rule is that such ownership shall pass from the vendor to the vendee upon the actual or constructive delivery of the thing sold even if the purchase price has not yet been paid. Non-payment only creates a right to demand payment or to rescind the contract, or to criminal prosecution in the case of bouncing checks. But absent the stipulation above noted, delivery of the thing sold will effectively transfer ownership to the buyer who can in turn transfer it to another. Actual delivery of the books having been made, Cruz acquired ownership over the books which he could then validly transfer to the private respondents. The fact that he had not yet paid for them to EDCA was a matter between him and EDCA and did not impair the title acquired by the private respondents to the books. We cannot see the justice in transferring EDCA's loss to the Santoses who had acted in good faith, and with proper care, when they bought the books from Cruz. _____________________________________________________

CONSUELO S. DE GARCIA and ANASTACIO GARCIA vs. HON. COURT OF APPEALS, ANGELINA D. GUEVARA and JUAN B. GUEVARA G.R. No. L-20264 January 30,1971 Fernando, J. Issue: Whether or not a person who have been unlawfully deprived of a movable may recover the same from the person in possession of the same? Held: YES. The controlling provision is Article 559 of the Civil Code. It reads thus: "The possession of movable property acquired in good faith is equivalent to a title. Nevertheless, one who has lost any movable or has been unlawfully deprived thereof may recover it from the person in possession of the same. If the possessor of a movable lost of which the owner has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot obtain its return without reimbursing the price paid therefor." Respondent Angelina D. Guevara, having been unlawfully deprived of the diamond ring in question, was entitled to recover it from petitioner Consuelo S. de Garcia who was found in possession of the same. The only exception the law allows is when there is acquisition in good faith of the possessor at a public sale, in which case the owner cannot obtain its return without reimbursing the price. _____________________________________________________ DOMINADOR DIZON v. LOURDES SUNTAY G.R. No. L-30817 September 29, 1972 Fernando, J. Issue: Whether or not Suntay has the right of possession over the diamond ring which was pledged to Dizon’s pawnshop. Held: Yes. The controlling provision is Article 559 of the Civil Code which provides in part that one who has lost any movable or has been unlawfully deprived thereof may recover it from the person in possession of the same. Suntay having been unlawfully deprived of the ring in question, is entitled to recover it from Dizon who was found in possession of the same. Neither can Dizon’s defense of estoppels stand. Estoppel has its roots in equity with good faith as its basis. How then can petitioner in all seriousness assert that his appeal finds support in the doctrine of estoppels? Neither the promptings of equity nor the mandates of moral right and natural justice come to his rescue. He is engaged in a business where presumably ordinary prudence would manifest itself to ascertain whether or not an individual who is offering jewelry by way of a pledge is entitled to do so. If no such care be taken, perhaps because of the difficulty of resisting opportunity for profit, he should be the last to complain if thereafter the right of the true owner of such jewelry should be recognized. LEDESMA V COURT OF APPEALS G.R. No. 86051. September 1, 1992 Davide Jr, J ISSUE: Whether private respondent was unlawfully deprived of the cars when it sold the same to Rustico Consunji, through a person who claimed to be Jojo Consunji, allegedly the latter’s son, but who nevertheless turned out to be Armando Suarez, on the faith of a Manager’s Check with a face value of P101,000.00, dishonored for being altered, the correct amount being only P101.00.chanrobles virtual lawlibrary HELD: No. It is quite clear that a party who (a) has lost any movable or (b) has been unlawfully deprived thereof can recover the same from the present possessor even if the latter acquired it in good faith and has, therefore, title thereto for under the first sentence of Article 559, such manner of acquisition is equivalent to a title. There are three (3) requisites to make possession of movable property equivalent to title, namely: (a) the possession should be in good faith; (b) the owner voluntarily parted with the possession of the thing; and (c) the possession is in the concept of owner.

Undoubtedly, one who has lost a movable or who has been unlawfully deprived of it cannot be said to have voluntarily parted with the possession thereof. This is the justification for the exceptions found under the second sentence of Article 559 of the Civil Code. There was a perfected unconditional contract of sale between private respondent and the original vendee. The former voluntarily caused the transfer of the certificate of registration of the vehicle in the name of the first vendee — even if the said vendee was represented by someone who used a fictitious name — and likewise voluntarily delivered the cars and the certificate of registration to the vendee’s alleged representative Title thereto was forthwith transferred to the vendee. The subsequent dishonor of the check because of the alteration merely amounted to a failure of consideration which does not render the contract of sale void, but merely allows the prejudiced party to sue for specific performance or rescission of the contract, and to prosecute the impostor for estafa under Article 315 of the Revised Penal Code. It was therefore erroneous for the respondent Court to declare that the private respondent was illegally deprived of the car simply because the check in payment therefor was subsequently dishonored; said Court also erred when it divested the petitioner, a buyer in good faith who paid valuable consideration therefor, of his possession thereof. AZARCON v. EUSEBIO G.R. No. L-11977 April 29, 1959 LABRADOR, J. Issue: Can the parties ousted in the property be entitled to the palay they planted? Held: Yes. The evidence shows that in spite of the receipt by the defendants of the notice of the writ of execution of October 3, 1955, which writ of execution commanded defendants "to forthwith remove from said premises and that plaintiff have restitution of the same," defendants-appellants nevertheless entered the land to gather palay which was then pending harvest. We gather further from the record that the rice found on the disputed land at the time of the service of the order of execution had been planted by defendants-appellants, who appear to have been in possession of the land from 1951. While the court order of October 3, 1955 ordered the defendant-appellant to move out from the premises, it did not prohibit them from gathering the crop then existing thereon. Under the law a person who is in possession and who is being ordered to leave a parcel of land while products thereon are pending harvest, has the right to a part of the net harvest, as expressly provided by Article 545 of the Civil Code. ART. 545. If at the time the good faith ceases, there should be any natural or industrial fruits, the possessor shall have a right to a part of the expenses of cultivation, and to a part of the net harvest, both in proportion to the time of the possession.

CORDERO v. CABRAL G.R. No. L-36789 July 25, 1983 Abad Santos, J. Issue: Whether or not respondents were possessors in bad faith and as such, are liable for the fruits of the lot subject to the controversy. Held: Yes. The controversy arose from the non-consummated transaction between the Gregorio Ocampo, predecessor of plaintiffs and Antonio Rodriguez, predecessor of defendants. The Court of Appeals held that the sale between the two have never materialized and Rodriguez' occupation of the land was merely as a prospective owner and not adverse. Neither was it continuous for 50 years since Ocampo was in possession of the same before Rodriguez came to possession which was again merely with the consent and toleration of Ocampo. The disputed land remains to be included in the transfer certificate title issued to Ocampo. And although the defendants claimed in their answer that plaintiff's predecessor was only able to register the same in his name through error or fraud, they made no claim of the alleged

transaction between their predecessors nor mentioned the name of Antonio Rodriguez. Hence, the defendants, by their own admission, are in possession of the disputed land. There is no evidence that they were possessors in bad faith. However, their good faith ceased when they were served with summons to answer the complaint. Possession acquired in good faith does not lose this character except in the case and from the moment facts exist which show that the possessor is not unaware that he possesses the thing improperly or wrongfully. (Art. 528, Civil Code.) As possessors in bad faith from the service of the summons they "shall reimburse the fruits received and those which the legitimate possessor could have received, ... (Art. 549, Civil Code.) _____________________________________________________ Mendoza and Enriquez vs. De Guzman G.R. No. 28721 October 5, 1928 MALCOLM, J. ISSUE: Whether or not that in accordance with the provisions of articles 435 and 454 in relation with article 361 of the Civil Code, the value of the "indemnization" to be paid to the defendant should be fixed according to the necessary and useful expenses incurred by him in introducing "las plantaciones en cuestion"?

HELD: Yes. Article 361 of the Civil Code in the original Spanish text uses the word "indemnizacion." However one may speculate as to the true meaning of the term "indemnizacion" whether correctly translated as "compensation" or "indemnity," the amount of the "indemnizacion" is the amount of the expenditures mentioned in articles 453 and 454 of the Civil Code, which in the present case is the amount of the necessary and useful expenditures incurred by the defendant. Necessary expenses have been variously described by the Spanish commentators as those made for the preservation of the thing (4 Manresa's Comentarios al Codigo Civil, p. 258); as those without which the thing would deteriorate or be lost (Scaevola's Comentarios al Codigo Civil, p.408); as those that augment the income of the things upon which they are expanded (4 Manresa's Comentarios al Codigo Civil, p. 261; 8 Scaevola's Comentarios al Codigo Civil, p. 416). Among the necessary expenditures are those incurred for cultivation, production, upkeep, etc. (4 Manresa's Comentarios al Codigo Civil, p. 257). Here the plaintiffs have chosen to take the improvements introduced on the land and are disposed to pay the amount of the necessary and useful expenses incurred by the defendant. Inasmuch as the retentionist, who is not exactly a possessor in good faith within the meaning of the law, seeks to be reimbursed for the necessary and useful expenditures, it is only just that he should account to the owners of the estate for any rents, fruits, or crops he has gathered from it. _____________________________________________________ Robles and Martin vs. Lizzaraga Hermanos G. R. No. L-16736 December 22, 1921 Romualdez, J: Issue: Whether Evarista Robles is the owner of the aforesaid improvements and has the right to demand payment of their value and whether she has any right to retain the building until the said value is paid to her. Held: Attention is called to article 453 of the Civil Code which reads: Necessary expenditures shall be refunded to every possessor, but only the possessor in good faith may retain the thing until they are repaid to him. Useful expenditures shall be paid the possessor in good faith with the same right to retention, the person who has defeated him in his possession having the opinion of refunding the amount of such expenditures or paying him the increase in value which the thing has acquired by reason thereof.

This provision of law is in force and applies to personal as well as real property.wliThe expenditures incurred in these improvements were not necessary inasmuch as without them the house would have continued to stand just as before, but were useful, inasmuch as with them the house better serves the purpose for which it was intended, being used as a residence, and the improvements consisting of the addition of a dining room, kitchen, closet, and bathroom in the lower and upper stories of the house, and a stable, suitable as a coach house and dwelling, it is beyond doubt that such improvements are useful to the building. Now then, was Evarista Robles a possessor in good faith when she made those improvements? Article 434 provides that "good faith is always presumed and the burden of proving bad faith on the part of the possessor rests upon the person alleging it." Lizarraga Hermanos did not allege, nor prove in the first instance the bad faith characterizing Evarista Robles' possession, who, as shown in the records and heretofore stated, began to occupy the house by permission of the former owner, her mother Anastasia de la Rama, and continued later in the occupation by the consent of her coheirs, and afterwards by considering herself the future owner of the building by virtue of the contract with the present owner, Lizarraga Hermanos. The evidence shows that said improvements were begun about the end of December, 1916, after the agreement with Lizarraga Hermanos for the sale thereof to Evarista Robles. We find that in the court below the presumption of good faith in favor of Evarista Robles' possession at the time she made the improvements on the property was neither disputed nor discussed, but on the contrary, there is positive evidence sufficient to support the conclusion that when she made the improvements on the aforesaid building she was possessing it in good faith. If the improvements are useful and Evarista Robles' possession was in good faith, the conclusion set out in article 453 of the Civil Code, is inevitable; Evarista Robles is the owner of such improvements, and entitled to reimbursement therefor, and to retain the building until the same is made. _____________________________________________________ METROPOLITAN WATERWORKS AND SEWERAGE SYSTEM v. THE COURT OF APPEALS and THE CITY OF DAGUPAN G.R. No. L-54526 August 25, 1986 FERIA, J.: ISSUE: Does a possessor in bad faith have the right to remove useful improvements? HELD: NO. Article 449 of the Civil Code of the Philippines provides that "he who builds, plants or sows in bad faith on the land of another, loses what is built, planted or sown without right to indemnity." As a builder in bad faith, NAWASA lost whatever useful improvements it had made without right to indemnity. Moreover, under Article 546 of said code, only a possessor in good faith shall be refunded for useful expenses with the right of retention until reimbursed; and under Article 547 thereof, only a possessor in good faith may remove useful improvements if this can be done without damage to the principal thing and if the person who recovers the possession does not exercise the option of reimbursing the useful expenses. The right given a possessor in bad faith is to remove improvements applies only to improvements for pure luxury or mere pleasure, provided the thing suffers no injury thereby and the lawful possessor does not prefer to retain them by paying the value they have at the time he enters into possession. In Mindanao Academy, Inc. vs. Yap (13 SCRA 190), the Court ruled that "if the defendant constructed a new building, as he alleges, he cannot recover its value because the construction was done after the filing of the action for annulment, thus rendering him a builder in bad faith who is denied by law any right of reimbursement."