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Sarmiento vs.

Agana (129 SCRA 122)

No. L-57288.

April 30, 1984

Leonila Sarmiento = petitioner.

Hon. Enrique A. Agana, Judge CFI,Rizal and Spouses Ernesto Valentino
and Rebecca Lorenzo Valentino = respondents.

There was a time when Ernesto Valentino was still courting his wife; the mother of his
wife told them that they could build a Residential House assuming that the wifes mother
is the owner of the land;

Ernesto constructed the house with the cost of P8,000 to P10,000;

It was later found out that the land was owned by spouses Santos who subsequently
sold the land to Sarmiento;

Sarmiento filed an ejectment suit to the MTC against spouses Ernesto to vacate the lot;

MTC ruled that the spouses Ernesto built the residential house in good faith and ordered
the spouses Ernesto to vacate the land after Sarmiento has paid them P20,000 as the
value of the land;

The case was elevated to the CFI of Pasay, modified the decision under Art. 448 of the
Civil Code that Sarmiento was required within 60 days to exercise the option to
1.) reimburse spouses Ernesto P40,000 as the value of the residential house OR to
2.) let the spouses purchase the land for P25,000.

Sarmiento did not exercise his right in any of the two options;

The spouses Ernesto was then allowed by the CFI to deposit P25,000 as the purchase
price of the land;

Sarmiento filed a petition for certiorari to the Supreme Court.

Issue: Whether or not Sarmiento is compelled to exercise his right in any of the two options?
Held: Yes, the landowner, Sarmiento is required by law to exercise only to two (2) options:
1.) To purchase the house of the spouses Ernesto or 2.) Sell his land to the spouses.
Based on Article 448, the owner of the land is compelled by law to exercise either
option. He cannot refuse to choose either option for it will be a violation of the law.
The owner of the house, spouses Ernesto who erected in good faith on a land owned by
Sarmiento, is entitled to retain the possession of the land until he is paid the value of his
house under Article 546. The owner of the land, Sarmiento has the option under Article
448, either to pay for the building, or to sell his land to the spouses Ernesto.

Article 448. 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 works, sowing or planting, after payment of the indemnity provided for in articles 546 and 548, or to oblige the one who built or
planted to pay the price of the land, and the one who sowed, the proper rent. However, the builder or planter cannot be obliged to buy the
land if its value is considerably more than that of the building or trees. In such case, he shall pay reasonable rent, if the owner of the land
does not choose to appropriate the building or trees after proper indemnity. The parties shall agree upon the terms of the lease and in case
of disagreement, the court shall fix the terms thereof. (361a)
Article 546. Necessary expenses shall be refunded to every possessor; but only the possessor in good faith may retain the thing until he
has been reimbursed therefor. Useful expenses shall be refunded only to the possessor in good faith with the same right of retention,
the person who has defeated him in the possession having the option of refunding the amount of the expenses or of paying the increase in
value which the thing may have acquired by reason thereof. (453a)
Article 548. Expenses for pure luxury or mere pleasure shall not be refunded to the possessor in good faith; but he may remove the
ornaments with which he has embellished the principal thing if it suffers no injury thereby, and if his successor in the possession does not
prefer to refund the amount expended. (454)