1. Bicerra vs.

Teneza
6 SCRA 649
Facts: This case is before us on appeal from the order of the Court of First Instance of Abra dismissing the complaint filed by appellants, upon motion of defendants-appellees
on the ground that the action was within the exclusive (original) jurisdiction of the Justice of the Peace Court of Lagangilang, of the same province.
The complaint alleges in substance that appellants were the owners of the house, worth P200.00, built on a lot owned by them and situated in the said municipality of
Lagangilang; that sometime in January 1957 appellees forcibly demolished the house, claiming to be the owners thereof; that the materials of the house, after it was
dismantled, were placed in the custody of the barrio lieutenant of the place; and that as a result of appellees' refusal to restore the house or to deliver the materials to
appellants the latter have suffered actual damages in the amount of P200.00 plus moral and consequential damages in the amount of P600.00.
Issue: Whether or not the action involves title to real property?
The dismissal of the complaint was proper. A house is classified as immovable property by reason of its adherence to the soil on which it is built (Art. 415, par. 1, Civil Code).
This classification holds true regardless of the fact that the house may be situated on land belonging to a different owner. But once the house is demolished, as in this
case, it ceases to exist as such and hence its character as an immovable likewise ceases. It should be noted that the complaint here is for recovery of damages. This
is the only positive relief prayed for by appellants. To be sure, they also asked that they be declared owners of the dismantled house and/or of the materials. However, such
declaration in no wise constitutes the relief itself which if granted by final judgment could be enforceable by execution, but is only incidental to the real cause of action to
recover damages.
In this case, the plaintiff filed an action before the Court of First Instance(now RTC) of Abra alleging that the defendant forcibly demolished his house and that the materials of
the house, after it was dismantled, were placed in the custody of the barrio lieutenant. Plaintiff prayed that he be declared the owner of the house and/or materials and that
defendant be ordered to pay him damages in the total sum of P800. The CFI dismissed the action on the ground that the same was within the exclusive original jurisdiction of
the Justice of thePeace of Court (now MTC), the action not being a real action. In sustaining the dismissal of the complaint, the Supreme Court explained: A house is
classified as immovable property by reason of its adherence to the soil on which it is built (Art. 415, par. 1, Civil Code). This classification holds true regardless of the fact that
the house may be situated on land belonging to a different owner. But once the house is demolished, as in this case, it ceases to exist as such and hence its character as an
immovable likewise ceases. It should be noted that the complaint here is for recovery of damages.

2. Punsalan, Jr. vs. Vda. De Lacsamana

121 SCRA 331 (1983)
In this case, Punzalan mortgaged with PNB a parcel of land situated in Tarlac which was eventually foreclosed by PNB in 1970. However, the bank secured title thereto only in
1977. In the meantime, while the property was still in the possession of Punzalan, he constructed thereon in 1974 a warehouse allegedly with the permission of PNB. In 1978,
PNB sold the land, includingthe building thereon, to Vda. de Lacsamana. Thus, Punzalan filed an action to annul the sale with respect to the building. He filed the action in
QuezonCity. The court dismissed the action on the ground of improper venue because the action is for recovery of a real property. The court ruled that the venueshould have
been Tarlac. In sustaining the decision of the lower court, the Supreme Court ruled that the warehouse claimed to be owned by (Punzalan) is an immovable or real property
as provided in Article 415(1) of the Civil Code and that buildings are always immovable under the Code. The Court further ruled that the prevalent doctrine is that an action
for the annulment or rescission of a sale of real property does not operate to efface the fundamental and prime objective and nature of the case, which is to recover said real
property. It is a real action.
Facts: Antonio Punsalan, Jr., was the former registered owner of a parcel of land consisting of 340 square meters situated in Bamban, Tarlac. In 1963, petitioner mortgaged
said land to respondent PNB (Tarlac Branch) in the amount of P10,000.00, but for failure to pay said amount, the property was foreclosed on December 16, 1970. Respondent
PNB (Tarlac Branch) was the highest bidder in said foreclosure proceedings. However, the bank secured title thereto only on December 14, 1977.
In the meantime, in 1974, while the property was still in the alleged possession of petitioner and with the alleged acquiescence of respondent PNB (Tarlac Branch), and upon
securing a permit from the Municipal Mayor, petitioner constructed a warehouse on said property. Petitioner declared said warehouse for tax Purposes for which he was
issued Tax Declaration No. 5619. Petitioner then leased the warehouse to one Hermogenes Sibal for a period of 10 years starting January 1975.
On July 26, 1978, a Deed of Sale was executed between respondent PNB (Tarlac Branch) and respondent Lacsamana over the property.
On November 22, 1979, petitioner commenced suit for "Annulment of Deed of Sale with Damages" against herein respondents PNB and Lacsamana before respondent
Court of First Instance of Rizal, Branch XXXI, Quezon City, essentially impugning the validity of the sale of the building as embodied in the Amended Deed of Sale. But the
Court dismissed the action on the ground of improper venue because the action is for the recovery of a real property. The Court ruled that the venue should be on Tarlac.
Issue: Whether or not dismissal is meritorious on the ground of improper venue?
Ruling: Yes. The warehouse claimed to be owned by petitioner is an immovable or real property as provided in article 415(1) of the Civil Code. Buildings are
always immovable under the Code. A building treated separately from the land on which it stood is immovable property and the mere fact that the parties to a contract
seem to have dealt with it separate and apart from the land on which it stood in no wise changed its character as immovable property.
While it is true that petitioner does not directly seek the recovery of title or possession of the property in question, his action for annulment of sale and his claim for damages
are closely intertwined with the issue of ownership of the building which, under the law, is considered immovable property, the recovery of which is petitioner's primary
objective. The prevalent doctrine is that an action for the annulment or rescission of a sale of real property does not operate to efface the fundamental and prime objective and
nature of the case, which is to recover said real property. It is a real action.

3. Prudential Bank vs. Panis

153 SCRA 390
Facts: This is a petition for review on certiorari of the November 13,1978 Decision** of the then Court of First Instance of Zambales and Olongapo City declaring that the
deeds of real estate mortgage executed by respondent spouses in favor of petitioner bank are null and void.
On November 19, 1971, plaintiffs-spouses Fernando A. Magcale and Teodula Baluyut Magcale secured a loan in the sum of P70,000.00 from the defendant Prudential Bank.
To secure payment of this loan, plaintiffs executed in favor of defendant on the aforesaid date a deed of Real Estate Mortgage over a 2-STOREY, SEMI-CONCRETE,
residential building with warehouse spaces containing a total floor area of 263 sq. meters, more or less, generally constructed of mixed hard wood and concrete materials
which is declared and assessed in the name of FERNANDO MACCALE.
All corners of the lot marked by conc. cylindrical monuments of the Bureau of Lands as visible limits.
Issue: Whether or not a valid real estate mortgage can be constituted on the building erected on the land belonging to another?

Ruling: Yes. In the enumeration of properties under Article 415 of the Civil Code of the Philippines, this Court ruled that, "it is obvious that the inclusion of 'building'
separate and distinct from the land, in said provision of law can only mean that a building is by itself an immovable property."
Thus, while it is true that a mortgage of land necessarily includes, in the absence of stipulation of the improvements thereon, buildings, still a building by itself may be
mortgaged apart from the land on which it has been built. Such a mortgage would be still a real estate mortgage for the building would still be considered immovable property
even if dealt with separately and apart from the land (Leung Yee vs. Strong Machinery Co., 37 Phil. 644). In the same manner, this Court has also established that
possessory rights over said properties before title is vested on the grantee, may be validly trans. ferred or conveyed as in a deed of mortgage.
3. PRUDENTIAL BANK V. PANIS 153 SCRA 390
FACTS: Spouses Magcale secured a loan from Prudential Bank.

To secure payment, they executed a real estate mortgage over a residential building. The

mortgage included also the right to occupy the lot and the information about the sales patent applied for by the spouses for the lot to which the building stood. After securing
the first loan, the spouses secured another from the same bank.

To secure payment, another real estate mortgage was executed over the same properties.

The Secretary of Agriculture then issued a Miscellaneous Sales Patent over the land which was later on mortgaged to the bank.
The spouses then failed to pay for the loan and the REM was extrajudicially foreclosed and sold in public auction despite opposition from the spouses. The respondent court
held that the REM was null and void.

HELD: A real estate mortgage can be constituted on the building erected on the land belonging to another.
The inclusion of building distinct and separate from the land in the Civil Code can only mean that the building itself is an immovable property.
While it is true that a mortgage of land necessarily includes in the absence of stipulation of the improvements thereon, buildings, still a building in itself may be
mortgaged by itself apart from the land on which it is built. Such a mortgage would still be considered as a REM for the building would
still be considered as immovable property even if dealt with separately and apart from the land.
The original mortgage on the building and right to occupancy of the land was executed before the issuance of the sales patent and before the government was
divested of title to the land.

Under the foregoing, it is evident that the mortgage executed by private respondent on his own

building was a valid mortgage.

As to the second mortgage, it was done after the sales patent was issued and thus prohibits pertinent provisions of the Public Land Act.

Lopez vs. Orosa, Jr. and Plaza Theater Inc.

103 PHIL 98
Facts: Enrique Lopez is a resident of Balayan, Batangas, doing business under the trade name of Lopez-Castelo Sawmill. Sometime in May, 1946, Vicente Orosa, Jr., also a
resident of the same province, dropped at Lopez' house and invited him to make an investment in the theatre business. It was intimated that Orosa, his family and close friends
were organizing a corporation to be known as Plaza Theatre, Inc., that would engage in such venture. Although Lopez expressed his unwillingness to invest on the same, he
agreed to supply the lumber necessary for the construction of the proposed theatre, and at Orosa's behest and assurance that the latter would be personally liable for any
account that the said construction might incur, Lopez further agreed that payment therefor would be on demand and not cash on delivery basis. Pursuant to said verbal
agreement, Lpez delivered the lumber which was used for the construction of the Plaza Theatre on May 17, 1946, up to December 4 of the same year. But of the total cost of
the materials amounting to P62,255.85, Lpez was paid only P20,848.50, thus leaving a balance of P41,771.35.
We may state at this Juncture that the Plaza Theatre was erected on a piece of land with an area of 679.17 square meters formerly owned by Vicente Orosa, Jr., and was
acquired by the corporation on September 25, 1946, for P6,000. As Lpez was pressing Orosa for payment of the remaining unpaid obligation, the latter and Belarmino Rustia,
the president of the corporation, promised to obtain a bank loan by mortgaging the properties of the Plaza Theatre, Inc., out of which said amount of P41,771.35 would be
satisfied, to which assurance Lpez had to accede. Unknown to him, however, as early as November, 1946, the corporation already got a loan for P30,000 from the Philippine
National Bank with the Luzon Surety Company as surety, and the corporation in turn executed a mortgage on the land and building in favor of said company as countersecurity.
Issue: Whether or not owner of the building and the land on which it is adhered must be the same?
Ruling: 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.

LOPEZ V. OROSA AND PLAZA THEATRE

FACTS:
1. Lopez was engaged in business under the name Lopez-Castelo Sawmill.
2. Orosa, who lived in the same province as Lopez, one dayapproached Lopez and invited the latter to make an investment inthe theatre business.
3. Orosa, his family and close friends apparently were forming acorporation named Plaza Theatre.
4. Lopez expressed his unwillingness to invest. Nonetheless, therewas an oral agreement between Lopez and Orosa that Lopezwould be supplying the lumber for the
construction of the theatre.The terms were the following: one, Orosa would be personallyliable for any account that the said construction would incur; two,payment would be by
demand and not by cash on delivery.
5. Pursuant to the agreement, Lopez delivered the lumber for theconstruction. Lopez was only paid one-third of the total cost.
6. The land on which the building has been erected was previously owned by Orosa, which was later on purchased by the corporation.

7. Due to the incessant demands of Lopez, the corporation mortgaged its properties.
8. On an earlier relevant date, the corporation obtained a loan with Luzon Surety Company as surety and in turn, the corporation executed a mortgage over the land and
building. In the registration of the land under Act 496, such mortgage wasnt revealed.
9. Also due to the demands of Lopez, Orosa issued a deed of assignment over his shares of stock in the corporation.
10. As there was still an unpaid balance, Lopez filed a case against Orosa and Plaza theatre. He asked that Orosa and Plaza theatre be held liable solidarily for the unpaid
balance; and in case defendants failed to pay, the land and building should be sold in public auction with the proceeds to be applied to the balance; or
that the shares of stock be sold in public auction. Lopez also had lis pendens be annotated in the OCT.
11. The trial court decided that there was joint liability between defendants and that the materialmans lien was only confined tothe building.
ISSUES:
W/N the materialmens lien for the value of the materials used in the construction of the building attaches to said structure alone and doesnt extend to the land on which the
building is adhered to?
HELD: The contention that the lien executed in favor of the furnisher of materials used for the construction and repair of a building is also extended to land on which the
building was constructed is without merit. 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 in the enumeration of what may constitute real properties could only mean one thingthat a building is by itself an immovable property. Moreover, in the absence
of
any specific provision 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.
Appelant invoked Article 1923 of the Spanish Civil Code, which providesWith respect to determinate real property and real rights of the debtor, the following are preferred:
xxx Credits for reflection, not entered or recorded, and only with respect to other credits different from those mentioned in four next preceding paragraphs. Close examination
of the abovementioned provision reveals that the law gives preference to unregistered refectionary credits only with respect to the real estate upon which the refectionary or
work was made. This being so, the inevitable conclusion must be that the lien so created attaches merely to the immovable property for the construction or repair of which the
obligation was incurred. Therefore, the lien in favor of appellant for the unpaid value of the lumber used in the construction of the building attaches only to said structure and to
no other property of the obligors.
5. Evangelista vs. Alto Surety & Insurance Co.
103 PHIL 401
Facts: On June 4, 1949, petitioner herein, Santos Evangelista, instituted Civil Case No. 8235 of the Court of First Instance of Manila against Rivera for a sum of money. On
the same date, he obtained a writ of attachment, which was levied upon a house, built by Rivera on a land situated in Manila and leased to him, but owned by Alto
Surety. In due course, judgment was rendered in favor of Evangelista, who, on October 8, 1951, bought the house at public auction held in compliance with the writ of
execution issued in said case. The corresponding definite deed of sale was issued to him on October 22, 1952, upon expiration of the period of redemption. When Evangelista
sought to take possession of the house, Rivera refused to surrender it, upon the ground that he had leased the property from the Alto Surety & Insurance Co., Inc.-respondent
herein and that the latter is now the true owner of said property. It appears that on May 10, 1952, a definite deed of sale of the same house had been issued to respondent, as
the highest bidder at an auction sale held, on September 29, 1950.
Hence, on June 13, 1953, Evangelista instituted the present action against respondent and Ricardo Rivera, for the purpose of establishing his (Evangelista) title over said
house, and securing possession thereof, apart from recovering damages.
Issue: Whether or not the house should be considered as real property for purposes of attachment?
Ruling: Yes. A house is not personal property, much less a debt, credit or other personal property capable of manual delivery, but immovable property. "A true
building (not merely superimposed on the soil),is immovable or real property, whether it is erected by the owner of the land or by a usufructuary or lessee" (Laddera vs.
Hodges, 48 Off. Gaz., 5374.) and the attachment of such building is subject to the provisions of subsection (a) of section 7, Rule 59 of the Rules of Court.

Navarro vs. Pineda

9 SCRA 631
Facts: On December 14, 1959, defendants Rufino G. Pineda and his mother Juana Gonzales, borrowed from plaintiff Conrado P. Navarro, the sum of P2,550.00, payable 6
months after said date or on June 14, 1959. To secure the indebtedness, Rufino executed a document captioned "DEED OF REAL ESTATE and CHATTEL mortgages",
whereby Juana Gonzales, by way of of Real Estate Mortgage hypothecated a parcel of land, belonging to her, registered with the Register of Deeds of Tarlac, Under Transfer
Certificate of Title No. 25776, and Rufino G. Pineda, by way of Chattel Mortgage, mortgaged his two-story residential house, having a floor area of 912 square meters, erected
on a lot belonging to Atty. v. Vicente Castro, located at To. San Boque. Tarlac, Tarlac; and one motor truck, registered in his name, under Motor Vehicle Registration Certificate
No A-171806. Both mortgages were contained in one instrument, which was registered in both the Office of Vie Register of Deeds and the Motor Venicles Office of Tarlac.
When Navarro filed a complaint for foreclosure of the Mortgage, Pineda questioned the validity of the chattel mortgage over his house on the ground that the house, being an
immovable property, could not be subject of a chattel mortgage.
Issue: Whether or not the Chattel mortgage is valid?
Ruling: Yes. The trial court did not predicate its decision declaring the deed of chattel mortgage valid solely on the ground that the house mortgaged was erected on the land
which belonged to a third person, but also and principally on the doctrine of estoppel, in that "the parties have so expressly agreed" in the mortgage to consider the house as a
chattel "for its smallness and mixed materials of sawali and wood". For purposes of the application of the Chattel Mortgage Law, it was held that under certain conditions, "a
property may have a character different from that imputed to it in said articles. It is undeniable that the parties to a contract may by agreement; treat as personal property that
which by nature would be real property" (Standard Oil Co. of N.Y. vs. Jaranillo, 44 Phil., 632-633). he view that parties to a deed of chattel mortgage may agree to consider a
house as personal property for the purposes of said contract, "is good only insofar as the contracting parties are concerned. It is based, partly, upon the principles of estoppel .
. ." (Evangelista vs. Alto Surety No. L-11139, Apr. 23, 1958). In a case, a mortgaged house built on a rented land, was held to be a personal property not only because the
deed of mortgage considered. it as such, but also because it did not form an integral part of the land (Evangelista vs. Abad, [CA]; 36 O.G. 2913), for it is now well settled that
an object placed on land by one who has only a temporary right to the same, such as a lessee or usufructuary, does not become immobilized by attachment (Valdez vs.

Central Altagracia, 222 U.S. 58, cited in Davao Sawmill Co. Inc. vs. Castillo, et al., 61 Phil. 709). Hence, if a house belonging to a person stands on a rented land belonging to
another person, it may be mortgaged as a personal property if so stipulated in the document of mortgage (Evangelista vs. Abad, supra). It should be noted, however, that the
principle is predicated on statements by the owner declaring his house to be a chattel, a conduct that may conceivably estop him from subsequent claiming otherwise (Ladera,
et al. vs. C.W. Hodges, et al., [CA]; 48 O.G. 5374). The doctrine, therefore, gathered from these cases is that although in some instances, a house of mixed materials has been
considered as a chattel between the parties and that the validity of the contract between them, has been recognized, it has been a constant criterion nevertheless that, with
respect to third persons, who are not parties to the contract, and specially in execution proceedings, the house is considered as an immovable property (Art. 1431, New Civil
Code).
7. Tumalad vs. Vicencio
41 SCRA 143
Facts: Vicencio and Simeon executed a chattel mortgage in favor of Tumalad over their house on a lot rented from Madrigal and Company, Inc. When Vicencio and Simeon
defaulted in their payment of their obligation, the mortgage was extra-judicially foreclosed and the house was sold to an auction. Tumalad emerged as the highest bidder
during the auction. Subsequently, Tuamalad filed an action for ejectment against Vicencio and Simeon.
In their answer, the defendants Impugned the legality of the chattel mortgage and its subsequent foreclosure on the ground that the house being an immovable could only be a
subject of a real estate mortgage and not a chattel mortgage.
Issue: Whether or not the chattel mortgage is valid?
Ruling: Yes. In the case of Manarang and Manarang vs. Ofilada (99 Phil. 169), this Court stated that "it is undeniable that the parties to a contract may by agreement treat as
personal property that which by nature would be real property," citing Standard Oil Company of New York vs. Jaramillo (44 Phil. 632).
In the contract now before Us, the house on rented land is not only expressly designated as Chattel Mortgage; it specifically provides that "the mortgagor ... voluntarily
CEDES, SELLS and TRANSFERS by way of Chattel Mortgage the property together with its leasehold rights over the lot on which it is constructed and participation . .."
Although there is no specific statement referring to the subject house as personal property, yet by ceding, selling or transferring a property by way of chattel mortgage
defendants-appellants could only have meant to convey the house as chattel, or at least, intended to treat the same as such, so that they should not now be allowed to make
an inconsistent stand by claiming otherwise. Moreover, the subject house stood on a rented lot to which defendants-appellants merely had a temporary right as lessee, and
although this can not in itself alone determine the status of the property, it does so when combined with other factors to sustain the interpretation that the parties, particularly
the mortgagors, intended to treat the house as personalty. It is the defendants-appellants themselves, as debtors-mortgagors, who are attacking the validity of the chattel
mortgage in this case. The doctrine of estoppel therefore applies to the herein defendants-appellants, having treated the subject house as personalty.
8. Manarang vs. Ofilada
99 PHIL 108
Facts: On September 8, 1951, petitioner Lucia D. Manarang obtained a loan of P200 from Ernesto Esteban, and to secure its payment she executed a chattel mortgage over a
house of mixed materials erected on a lot on Alvarado Street, Manila. As Manarang did not pay the loan as agreed upon, Esteban brought an action against her in,the
municipal court of Manila for its recovery, alleging that the loan was secured by a chattel mortgage on her property. Judgment having been entered in plaintiff's favor, execution
was issued against the same property mortgaged.
Before the property could be sold Manarang offered to pay the sum of P277, which represented the amount of the judgment of P250, the interest thereon, the costs, and the
sheriff's fees, but the sheriff refused the tender unless the additional amount of P260 representing the publication of the notice of sale in two newspapers be paid also. So
defendants therein brought this suitu to compel the sheriff to accept the amount of P277 as full payment of the judgment and to annul the published notice of sale.
On the basis of the above facts counsel for Alanarang contended in the court below that the house in question should be considered as personal property and the publication
of the notice of its sale at public auction in execution considered unnecessary. The Court of First Instance held that although real property may sometimes be considered as
personal property, the sheriff was in duty bound to cause the publication of the notice of its sale in order to, make the sale valid or to prevent its being declared void or
voidable, and he did not, therefore, err in causing such publication of the notice. So it denied the petition.
Issue: Whether or not the house remains a real property?
Ruling: Yes. HOUSE IS PERSONAL PROPERTY FOR PURPOSES OF CHATTEL MORTGAGE ONLY; REMAINS REAL PROPERTY. The mere fact that a house was the
subject of a chattel mortgage and was considered as personal property by the parties does not make said house personal property for purposes of the notice to be given for its
sale at public auction. It is real property within the purview of Rule 39, section 16,of the Rules of Court as it has become a permanent fixture on the land, which is real
property.

9. Associated Insurance & Surety Co. vs. Iya, et.al

103 PHIL 972
Facts: Adriano Valino and Lucia A. Valino, husband and wife, were the owners and possessors of a house of strong materials constructed on Lot No. 3, Block No. 80 of the
Grace Park Subdivision in Caloocan, Rizal, which they purchased on installment basis from the Philippine Realty Corporation. On November 6, 1951, to enable her to
purchase on credit price from the NARIC, Lucia A, Valino filed a bond in the sum of P11,000.00 subscribed by the Associated Insurance & Surety Co., Inc., and ,as counterguaranty therefor, the spouses Valino executed an alleged chattel mortgage on the aforementioned house in favor of the surety company, which encumbrance was duly
registered with the Chattel Mortgage Register of Rizal on December 6, 1951. It is admitted that at the time said undertaking took place, the parcel of land on which the house
is erected was still registered in the name of the Philippine Realty Corporation.
On the other hand, as Lucia A. Valino, failed to satisfy her obligation to the NARIC, the surety company was compelled to pay the same pursuant to the undertaking of the
bond.
Sometime in July, 1953, the surety company learned of the existence of the real estate mortgage over the lot covered by T.C.T. No. 26884 together with the improvements
thereon; thus, said surety company instituted Civil Case No. 2162 of the Court of First Instance of Manila naming Adriano and Lucia Valino and Isabel Iya, the mortgagee, as
defendants. The complaint prayed for the exclusion of the residential house from the real estate mortgage in favor of defendant Iya and the declaration and recognition of
plaintiff's right to ownership over the same in virtue of the award given by the Provincial Sheriff of Rizal during the public auction held on December 26, 1952.
The two cases were jointly heard upon agreement of the parties, who submitted the same on a stipulation of facts, after which the Court rendered judgment dated March 8,
1956, holding that the chattel mortgage in favor of the Associated Insurance & Surety Co., Inc., was preferred and superior over the real estate mortgage subsequently
executed in favor of Isabel Iya.
Issue: Whether or not the immovable status of a building will be affected by change of ownership?
Ruling: No. 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 (Lopez vs.
Orosa, supra, p. 98). It cannot be divested of its character of a realty by the fact that the land on which it is constructed belongs to another. If the status of the
building were to depend on the ownership of the land, a situation would be created where a permanent fixture changes its nature or character as the ownership of the land
changes hands.
A building certainly cannot be divested of its character of a realty by the fact that the land on which it is constructed belongs to another. To hold it the other way, the possibility

is not remote that it would result in confusion, for to cloak the building with an uncertain status made dependent on the ownership of the land, would create a situation where a
permanent fixture changes its nature or character as the ownership of the land changes hands. In the case at bar, as personal properties could only be the subject of a chattel
mortgage (Section 1, Act 3952) and as obviously the structure in question is not one, the execution of the chattel mortgage covering said building is clearly invalid and a nullity.
While it is true that said document was correspondingly registered in the Chattel Mortgage Register of Rizal, this act produced no effect whatsoever for where the interest
conveyed is in the nature of a real property, the registration of the document in the registry of chattels is merely a futile act. Thus, the registration of the chattel mortgage of a
building of strong materials produce no effect as far as the building is concerned (Leung Yee vs. Strong Machinery Co., 37 Phil., 644).
10. Piansay vs. David
12 SCRA 227

As it may be true that the parties who agreed to attach the house in a chattel mortgage may be bound thereto under the doctrine of estoppel, the same
does not bind third persons.
FACTS:

Conrado S. David received a loan of P3,000 with interest at 12% per annum from Claudia B. Vda. de Uy Kim, one of the plaintiffs, and to secure the payment of the
same, Conrado S. David executed a chattel mortgage on a house situated at 1259 Sande Street, Tondo, Manila. The mortgage was foreclosed and was sold to
Kim to satisfy the debt. 2 years later after the foreclosure, the house was sold by Kim to Marcos Magubat. The latter then filed to collect the loan from David and to
declare the sale issued by Kim in favour of Piansay null and void. (It appears that Kim sold the house to two people, namely Piansay and Magubat) The trial court
approved of the collection of the loan from David but dismissed the complaint regarding the questioned sale between Kim and Piansay, declaring the latter as
rightful owner of the house and awarding damages to him. CA reversed the decision making David the rightful owner and ing him and his co-defendant, Mangubat,
to levy the house. Now Petitioners are trying to release the said property from the aforementioned levy by claiming that Piansay is the rightful owner of the house.
ISSUE:

Whether or not the sale between Kim and Piansay was valid?
RULING:

Since it is a rule in our law that buildings and constructions are regarded as mere accesories to the land (following the Roman maxim omne quod solo inaedificatur
solo credit) it is logical that said accessories should partake of the nature of the principal thing, which is the land forming, as they do, but a single object (res) with it
in contemplation of law. A mortgage creditor who purchases real properties at an extra-judicial foreclosure sale thereof by virtue of a chattel mortgage constituted
in his favor, which mortgage has been declared null and void with respect to said real properties acquires no right thereto by virtue of said sale Thus, Mrs. Uy Kim
had no right to foreclose the alleged chattel mortgage constituted in her favor, because it was in reality a mere contract of an unsecured loan. It follows that the
Sheriff was not authorized to sell the house as a result of the foreclosure of such chattel mortgage. And as Mrs. Uy Kim could not have acquired the house when
the Sheriff sold it at public auction, she could not, in the same token, it validly to Salvador Piansay. Conceding that the contract of sale between Mrs. Uy Kim and
Salvador Piansay was of no effect, we cannot nevertheless set it aside upon instance of Mangubat because, as the court below opined, he is not a party thereto
nor has he any interest in the subject matter therein, as it was never sold or mortgaged to him At any rate, regardless of the validity of a contract constituting a
chattel mortgage on a house, as between the parties to said contract, the same cannot and does not bind third persons, who are not parties to the aforementioned
contract or their privies. As a consequence, the sale of the house in question in the proceedings for the extrajudicial foreclosure of said chattel mortgage, is null
and void insofar as defendant Mangubat is concerned, and did not confer upon Mrs. Uy Kim, as buyer in said sale, any dominical right in and to said house, so that
she could not have transmitted to her assignee, plaintiff Piansay any such right as against defendant Mangubat. In short plaintiffs have no cause of action against
the defendants herein.

Facts: On December 11, 1943, Conrado S. David received a loan of P3,000 with interest at 12% per annum from Claudia B. Vda. de Uy Kim, one of the plaintiffs, and to
secure the payment of the same, Conrado S. David executed a chattel mortgage on a house situated at 1259 Sande Street, Tondo, Manila. That on February 10, 1953, the
mortgaged house was sold at 'public auction to satisfy the indebtedness to Claudia B. Vda. de Uy Kim, and the house was sold to Claudia B. Vda. de Uy Kim in the said
foreclosure proceedings; that on March 22, 1954.
Claudia B. Vda. de Uy Kim sold the same house to her co-plaintiff, Salvador Piansay for the sum of P5,000.00; that on November 22, 1949, defendant Conrado S. David
mortgaged the said house to Marcos Mangubat, and on March 1, 1956.
Marcos Mangubat filed a complaint against Conrado S. David or the collection of the loan of P2,000. After obtaining a judgment against David, the house was levied at the
instance of Mangubat.
Issue: Whether or not the right of Mangubat can be assailed?
Ruling: No. At any rate, regardless of the validity of a contract constituting a chattel mortgage on a house, as between the parties to said contract, he same cannot and does
not bind third persons, who are not parties to the aforementioned contract or their privies. As a consequence, the sale of the house in question in the proceedings for the extrajudicial foreclosure of said chattel mortgage, is null and void insofar as defendant Mangubat is concerned, and did not confer upon Mrs. Uy Kim, as buyer in said sale, any
dominical right in and to said house, so that she could not have transmitted to her assignee, plaintiff Piansay, any such right as against defendant Mangubat. In short, plaintiffs
have no cause of action against the defendants herein.
11. Standard Oil Co. of New York vs. Jaramillo
44 PHIL 630
Facts: Gervasia De La Rosa, a lessee of a parcel of land situated in the City of Manila and owner of the house thereon, executed a deed of chattel mortgage, conveying to
the plaintiff by way of mortgage both the leasehold interest in said lot and the building which stands thereon. After said document had been duly acknowledge and delivered,
the petitioner caused the same to be presented to the respondent, Joaquin Jaramillo, as register of deeds of the City of Manila, for the purpose of having the same
recorded in the book of record of chattel mortgages. Upon examination of the instrument, the respondent was of the opinion that it was not a chattel mortgage, for the reason
that the interest therein mortgaged did not appear to be personal property, within the meaning of the Chattel Mortgage Law, and registration was refused on this ground only.
Issue: Whether or not the Register of Deeds can refuse registration?
Ruling: No. We are of the opinion that the position taken by the respondent is untenable; and it is his duty to accept the proper fee and place the instrument on record. The
duties of a register of deeds in respect to the registration of chattel mortgage are of a purely ministerial character; and no provision of law can be cited which
confers upon him any judicial or quasi-judicial power to determine the nature of any document of which registration is sought as a chattel mortgage.

12. Board of Assessment Appeals vs. Manila Electric Co.

10 SCRA 68
FACTS:
City Assessor of QC declared the steel towers for real property tax under Tax Declarations. After denying the respondents petition to cancel these declarations, an appeal
was taken with the CTA which held that the steel towers come under the exception of poles under the franchise given to MERALCO; the steel towers are personal
properties; and the City Treasurer is liable for the refund of the amount paid.
HELD:
The steel towers of an electric company dont constitute real property for the purposes of real property tax.
Facts: On October 20, 1902, the Philippine Commission enacted Act No. 484 which authorized the Municipal Board of Manila to grant a franchise to construct, maintain and
operate an electric street railway and electric light, heat and power system in the City of Manila and its suburbs to the person or persons making the most favorable bid.
Charles M. Swift was awarded the said franchise on March 1903, the terms and conditions of which were embodied in Ordinance No. 44 approved on March 24, 1903.
Respondent Manila Electric Co. (Meralco for short), became the transferee and owner of the franchise.
Meralco's electric power is generated by its hydro-electric plant located at Botocan Falls, Laguna and is transmitted to the City of Manila by means of electric transmission
wires, running from the province of Laguna to the said City. These electric transmission wires which carry high voltage current, are fastened to insulators attached on steel
towers constructed by respondent at intervals, from its hydro-electric plant in the province of Laguna to the City of Manila. The respondent Meralco has constructed
40 of these steel towers within Quezon City, on land belonging to it.
On November 15, 1955, petitioner City Assessor of Quezon City declared the aforesaid steel towers for real property tax under Tax Declaration Nos. 31992 and
15549. After denying respondent's petition to cancel these declarations, an appeal was taken by respondent to the Board of Assessment Appeals of Quezon City, which
required respondent to pay the amount of P11,651.86 as real property tax on the said steel towers for the years 1952 to 1956. Respondent paid the amount tinder protest, and
filed a petition for review in the Court of Tax Appeals which rendered a decision on December 29, 1958, ordering the cancellation of the said tax declarations and the
petitioner City Treasurer of Quezon City to refund to the respondent the sum of P11,651.86.
Issue: Whether or not the "poles" shall be considered as immovables?
Ruling: No. Granting for the purpose of argument that the steel supports or towers in question are not embraced within the term poles, the logical question posited is whether
they constitute real properties, so that they can be subject to a real property tax. The tax law does not provide for a definition of real property; but Article 415 of the Civil
Code does, by stating the following are immovable property:
"(1) Land, buildings, roads, and constructions of all kinds adhered to the soil;
(3) Everything attached to an immovable in a fixed manner, in such a way that it cannot be separated therefrom without breaking the material or deterioration of the object;
(5) Machinery, receptacles, instruments or implements intended by the owner of the tenement for an industry or works which may be carried in a building or on a piece of land,
and which tends directly to meet the needs of the said industry or works;"
The steel towers or supports in question, do not come within the objects mentioned in paragraph 1, because they do not Constitute buildings or constructions adhered to the
soil. They are not constructions analogous to buildings nor adhering to the soil. As per description, given by the lower court, they are removable and merely attached
to a square metal frame by means of bolts, which when unscrewed could easily be dismantled and moved from place to place. They cannot be included under
paragraph 3, as they are not attached to an immovable in a fixed manner, and they can be separated without breaking the material or causing deterioration upon the object
to which they are attached. Each of these steel towers or supports consists of steel bars or metal strips, joined together by means of bolts, which can be disassembled by
unscrewing the bolts and reassembled by screwing the same. These steel towers or supports do not also fall under paragraph 5, for they are not machineries or receptacles,
instruments or implements, and even if they were, they are not intended for industry or works on the land. Petitioner is not engaged in an industry or works on the land in which
the steel supports or towers are constructed.

13. Sibal v. Valdez50 SCRA 512 (1927)

In this case, the deputy sheriff of the Province of Tarlac attached several properties of Leon Sibal, among
which was included the sugar cane in seven parcels of land. Thereafter, the said deputy sheriff sold at public
auction said properties, including the sugar cane, to Valdez. Sibal offered to redeem saidsugar came and
tendered to Valdez the amount sufficient to cover the price paid by the latter. Valdez, however refused to accept
the money and to returnthe sugar cane on the ground that the sugar cane in question had the nature of
personal property and was not, therefore, subject to redemption. On the issueof whether the sugar in question
is personal or real property, the Supreme Courtheld that for purposes of attachment and execution, and for the
purposes of the Chattel Mortgage Law, ungathered products have the nature of personal property.
4. Mindanao Bus Company v. The City Assessor and Treasurer G.R. No. L-17870, September 29, 1962, 6
SCRA 197Labrador, J.
FACTS: Petitioner Mindanao Bus Company is a public utility solely engaged intransporting passengers and
cargoes by motor trucks, over its authorized lines in theIsland of Mindanao, collecting rates approved by the
Public Service Commission.Respondent sought to assess the following real properties of the petitioner; (a)
HobartElectric Welder Machine, (b) Storm Boring Machine; (c) Lathe machine with motor; (d)Black and Decker
Grinder; (e) PEMCO Hydraulic Press; (f) Battery charger (Tungar charge machine) and (g) D-Engine
Waukesha-M-Fuel. It was alleged that thesemachineries are sitting on cement or wooden platforms, and that
petitioner is the owner of the land where it maintains and operates a garage for its TPU motor trucks, a repair
shop, blacksmith and carpentry shops, and with these machineries, which are placedtherein. Respondent City
Assessor of Cagayan de Oro City assessed at P4, 400petitioner's above-mentioned equipment. Petitioner

appealed the assessment to therespondent Board of Tax Appeals on the ground that the same are not
realty.Respondents contend that said equipments, though movable, are immobilized bydestination, in
accordance with paragraph 5 of Article 415 of the New Civil Code.
ISSUE: Whether the equipments in question are immovable or movable properties.
HELD: The equipments in question are movable. So that movable equipments to beimmobilized in
contemplation of the law, it must first be "essential and principalelements" 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."Thus, the Court distinguished those movable which become immobilized by destinationbecause
they are essential and principal elements in the industry from those which maynot be so considered
immobilized because they are merely incidental, not essential andprincipal.The tools and equipments in
question in this instant case are, by their nature, notessential and principle municipal elements of petitioner's
business of transportingpassengers and cargoes by motor trucks. They are merely incidentalsacquired
asmovables and used only for expediency to facilitate and/or improve its service. Evenwithout such tools and
equipments, its business may be carried on, as petitioner hascarried on, without such equipments, before the
war. The transportation business couldbe carried on without the repair or service shop if its rolling equipment is
repaired or serviced in another shop belonging to another.
5. Ladera v. HodgesG.R. No. 8027-R, September 23, 1952, Vol. 48, No. 12, Official Gazette 5374Reyes,
J.B.L., J.FACTS:
Paz G. Ladera entered into a contract with C.N. Hodges. Hodges promised tosell a lot with an area of 278
square meters to Ladera, subject to certain terms andconditions. The agreement called for a down payment of
P 800.00 and monthlyinstallments of P 5.00 each with interest of 1% per month, until P 2,085 is paid in full.
Incase of failure of the purchaser to make any monthly payment within 60 days after it felldue, the contract may
be considered as rescinded or annulled.Ladera built a house on the lot. Later on, she defaulted in the payment
of the agreedmonthly installment. Hodges filed an action for the ejectment of Ladera.The court issued an alias
writ of execution and pursuant thereto, the city sheriff leviedupon all rights, interests, and participation over the
house of Ladera. At the auction sale,Laderas house was sold to Avelino A. Magno. Manuel P. Villa, later on,
purchased thehouse from Magno.Ladera filed an action against Hodges and the judgment sale purchasers.
Judgmentwas rendered in favor of Ladera, setting aside the sale for non-compliance with Rule 39,Rules of
Court regarding judicial sales of real property. On appeal, Hodges contendsthat the house, being built on a lot
owned by another, should be regarded as movable or personal property.
ISSUE: Whether or not Laderas house is an immovable property.
HELD: YES. The old Civil Code numerates among the things declared by it asimmovable property the
following: lands, buildings, roads and constructions of all kindadhered 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 andconstructions as mere accessories to the land on which it is built, it is logical that
saidaccessories should partake the nature of the principal thing.