PROPERTY CASE DIGESTS

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 PROPERTY CASE DIGESTS

Insular Farms, Inc. by corresponding right to law firm of J. Antonio

ART. 447
virtue of a deed of recover the value of Araneta. The latter
GRN L-21783
absolute sale the unpaid lumber was one of the
NOVEMBER 29,
executed about seven and construction counsels of the
1969
months before the materials. Pacific Farms, Inc.
PACIFIC FARMS,
Company filed the Of course, They cannot claim
INC. VS. SIMPLICIO
civil action. Shielded the character of a ignorance of the
G. ESGUERRA,
by an indemnity bond buyer in good faith pendency of civil
CARRIED LUMBER
put up by the and for value, if really case because the
COMPANY
Company and the possessed by the Insular Farms, Inc.
Cosmopolitan Pacific Farms, could was defended by the
FACTS:
Insurance Company, possibly exonerate it same lawyer from
On several
Inc., the sheriff from making the same law firm
occasions, the
proceeded with the compensation. But that commenced the
Company sold and
announced public the Pacific Farm's present action.
delivered lumber and
auction and sold the stance that it is an Pacific
construction materials
levied buildings to the innocent purchaser Farms merely folded
to the Insular Farms,
Company. for value and in good its arms in disinterest
Inc. which the latter
faith is open to grave and waited, so to
used in the
ISSUE: doubt because of speak. Not until a
construction of the
WON the Company is certain facts of decision was
aforementioned six
entitled to a substantial import rendered therein in
buildings at its
materialmans lien to (evident from the favor of the Company,
compound in Bolinao,
be paid by Pacific records) that cannot a writ of execution
Pangasian. Of the
Farms, Inc? escape notice. issued, and the six
total procurement
In the deed buildings levied upon
price of P15,000, the
HELD: YES. of absolute sale, by the sheriff, did it
sum of P4,710.18 has
Therefore, exhibit 1, the Insular file a third-party claim
not been paid by the
applying article 447 Farms, Inc. (vendor) over the levied
Insular Farms, Inc.
by analogy, we was represented in buildings.
The Company
perforce consider the the contract by its
instituted a civil case
buildings as the president, J. Antonio
with the CIR of
principal and the Araneta. The latter
Pangasinan to ART. 448
lumber and was a director of the
recover the said
construction materials appellee (Pacific
unpaid balance from PNB V. DE JESUS
that went into their Farms, Inc.) and was
the Insular Farms, 411 SCRA 557
construction as the the counsel who
Inc. The trial court
accessory. Thus signed the complaint
rendered judgment in FACTS:
Pacific Farms, if it filed by the appellee
favor of the It would
does own the six in the court below. J.
Company's claim. The appear that on 10
buildings, must bear Antonio Araneta
corresponding writ of June 1995,
the obligation to pay was, therefore, not
execution was issued respondent filed a
for the value of the only the president of
because there was no complaint against
said materials; the the Insular Farms,
appeal instituted by petitioner before the
Company- which Inc. but also a
Insular, Inc. Regional Trial Court
apparently has no director and counsel
The Pacific of Occidental Mindoro
desire to remove the of Pacific Farms.
Farms, Inc. filed a for recovery of
materials, and, even if During the
third-party claim ownership and
it were minded to do trial of civil case the
asserting ownership possession, with
so, cannot remove Insular Farms, Inc.
over the levied damages, over the
them without was represented by
buildings which it had questioned property.
necessarily damaging Attorney Amado
acquired from the In his complaint,
the buildings has the Santiago, Jr. of the

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 PROPERTY CASE DIGESTS

respondent stated mortgaged the lot to mother, Paulina The

that he had acquired the Development Amado vda. de petitioners sent a
a parcel of land Bank of the Geminiano. On a 12- letter addressed to
situated in Philippines. He also square-meter portion private respondent
Mamburao, contends that he is a of that lot stood the Mary Nicolas
Occidental Mindoro, builder in good faith. petitioners' unfinished demanding that she
with an area of 1,144 bungalow, which the vacate the premises
square meters ISSUE: petitioners sold to the and pay the rentals in
covered by TCT No. Whether or not being private respondents, arrears within twenty
T-17197, and that on a builder in good faith with an alleged days from notice.
26 March 1993, he matters under article promise to sell to the Upon failure
had caused a 448. latter that portion of of the private
verification survey of the lot occupied by respondents to heed
the property and HELD: the house. the demand, the
discovered that the Article 448, Subsequently, the petitioners filed a
northern portion of the of the Civil Code petitioners' mother complaint for unlawful
lot was being refers to a piece of executed a contract of detainer and
encroached upon by land whose lease over a 126 damages.
a building of petitioner ownership is claimed square-meter portion
to the extent of 124 by two or more of the lot, including ISSUE: WON Art. 448
square meters. parties, one of whom that portion on which is applicable to this
Despite two letters of has built some works the house stood, in case.
demand sent by (or sown or planted favor of the private
respondent, petitioner something) and not to respondents for HELD: NO.
failed and refused to a case where the P40.00 per month for The private
vacate the area. owner of the land is a period of 7 years. respondents claim
Petitioner, in the builder, sower, or The private they are builders in
its answer, asserted planter who then later respondents then good faith, hence,
that when it acquired loses ownership of introduced additional Article 448 of the Civil
the lot and the the land by sale or improvements and Code should apply.
building sometime in otherwise for, registered the house They rely on the lack
1981 from then Mayor elsewise stated, in their names. After of title of the
Bienvenido Ignacio, where the true owner the expiration of the petitioners' mother at
the encroachment himself is the builder lease contract, the time of the
already was in of works on his own however, the execution of the
existence and to land, the issue of petitioners' mother contract of lease, as
remedy the situation, good faith or bad faith refused to accept the well as the alleged
Mayor Ignacio offered is entirely irrelevant. monthly rentals. assurance made by
to sell the area in It turned out the petitioners that
question (which then that the lot in question the lot on which the
also belonged to G.R. NO. 120303. was the subject of a house stood would be
Ignacio) to petitioner suit, which resulted in sold to them.
JULY 24, 1996
at P100.00 per its acquisition by one But being mere
square meter which GEMINIANO, ET. Maria Lee in 1972. lessees, the private
offer the latter AL. VS. COURT OF Lee sold the lot to Lily respondents knew
claimed to have Salcedo, who in turn that their occupation
APPEALS
accepted. The sale, sold it to the spouses of the premises would
however, did not Dionisio. Spouses continue only for the
FACTS:
materialize when, Dionisio executed a life of the lease.
It appears
without the Deed of Quitclaim Plainly, they cannot
that subject lot was
knowledge and over the said property be considered as
originally owned by
consent of petitioner, in favor of the possessors nor
the petitioners'
Mayor Ignacio later petitioners. builders in good faith.

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 PROPERTY CASE DIGESTS

Article 448 of The HELD: until reimbursements.

the Civil Code, in
petitioner bought a lot No, the What applies in this
relation to Article 546
owned by Mrs. lessee cannot be case is Art. 1678
of the same Code,
which allows full Charvet which was considered a builder (NCC) which provides
reimbursement of then previously in good faith. The that, " if the lessee,
useful improvements leased by the latter to provision under Art. makes, in good faith,
and retention of the one Richard Stohner. 448 of the New Civil useful improvements
premises until The said lease Code (Philippine) on which are suitable to
reimbursement is contract provided that a builder of good faith the use for which the
made, applies only to
the lessee may erect applies only to the lease is intended,
a possessor in good
structures and owner of the land who without altering the
faith, i.e., one who
builds on land with improvements which believes he is the form or substance of
the belief that he is shall remain as rightful owner thereof, the property leased,
the owner thereof. It lessee's property and but not to a lessee the lessor upon the
does not apply where he may remove them who's interest in the termination of the
one's only interest is at any time. It further land is derived only lease shall pay the
that of a lessee under
provided that should from a rental contract. lessee 1/2 of the
a rental contract;
the lessee fail to Neither can Stohner value of the
otherwise, it would
always be in the remove the same be considered a improvements at the
power of the tenant to structures or 'possessor in good time. Should the
"improve" his landlord improvements withing faith'. A possessor in lessor refuse to
out of his property. two months after the good faith is a party reimburse said
And even if expiration of the who possesses amount, the lessee
the petitioners indeed lease, the lessor may property believing that may remove the
promised to sell, it
remove them or he is its rightful owner improvements even
would not make the
private respondents cause them to be but discovers later on though the principal
possessors or removed at the a flaw in his title that thing may suffer
builders in good faith expense of the could indicate that he damage thereby. He
so as to be covered lessee. Stohner made might not be its legal shall not. however,
by the provisions of fillings on the land owner. It cannot apply cause any more
Article 448 of the Civil and constructed a to a lessee because impairment upon the
Code. The latter
house. When he he knows right from property leased than
cannot raise the mere
failed to pay the rent, the start that he is is necessary."
expectancy of
ownership of the the petitioner, through merely a lessee and
aforementioned lot counsel, sent Stohner not the owner of the
because the alleged a demand letter premises. G.R. No. 156437.
promise to sell was ordering him to As a mere March 1, 2004
not fulfilled nor its vacate the lot. The lessee, he introduces NATIONAL
existence even HOUSING
lessee contended that improvements to the
proven. AUTHORITY vs.
he is a 'builder in property at his own
GRACE BAPTIST
good faith.' risk such that he
CHURCH and
BALUCANAG VS. cannot recover from
COURT OF
FRANCISCO ISSUE: the owner the APPEALS
122 SCRA 344 Is the lessee a builder reimbursements nor
FACTS: in good faith? he has any right to FACTS:
retain the premises On June 13,
1986, Respondent

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 PROPERTY CASE DIGESTS

Grace Baptist Church Petitioner NHA filed a obliged to buy the auction sale. This was
wrote a letter to NHA motion for land and if its value is affirmed by the CA
manifesting their reconsideration which considerably more and by the SC.
intent to purchase Lot was denied. Hence than that of the
The Nuguids
4 and 17 of the this petition for review building or trees. In
General Mariano on certiorari such case, he shall became the
Alvarez Resettlement pay reasonable rent, uncontested owners
Project in Cavite. The ISSUE: if the owner of the of commercial lot. The
latter granted request WON NHA can be land does not choose Nuguid spouses
hence respondent compelled to sell the to appropriate the moved for delivery of
entered into lots under market building or trees after possession of the lot
possession of the lots value? proper indemnity. The
and the apartment
and introduced parties shall agree,
improvements HELD: on case of building.
thereon. On February No, because disagreement, court
22, 1991, NHA the contract has not shall fix. ISSUE:
passed a resolution been perfected. WON the Nuguids
approving the sale of The Church should reimburse
the subject lots to despite knowledge G.R. NO. 151815. Pecson for the
respondent Church that its intended FEBRUARY 23, 2005 benefits derived from
for 700 per square contract of sale with
SPOUSES JUAN the apartment
meter, a total of the NHA had not been
P430,500. perfected proceeded NUGUID AND building.
respondents were to introduce ERLINDA T. NUGUID
duly informed. improvements on the VS. HON. COURT HELD: YES.
On April 8, land. On the other OF APPEALS AND Since
1991, respondent hand, NHA knowingly PEDRO P. PECSON petitioners opted to
church tendered a granted the Church
check amounting to temporary use of the appropriate the
FACTS: improvement for
P55,350 contending subject properties and
that this was the did not prevent the Pedro P. themselves as early
agreed price. NHA Church from making Pecson owned a as June 1993, when
avers stating that the improvements commercial lot on they applied for a writ
price now (1991) is thereon. Thus the which he built a four- of execution despite
different from before Church and NHA, door two-storey knowledge that the
(1986). who both acted in bad apartment building.
The trial faith shall be treated auction sale did not
For failure to pay include the apartment
court rendered a as if they were both in
decision in favour of good faith. In this realty taxes, the lot building, they could
NHA stating that there connection Art 448 was sold at public not benefit from the
was no contract of provides: the owner auction by the City lots improvement,
sale, ordering to of the land in which Treasurer to Mamerto until they reimbursed
return the said lots to anything has been Nepomuceno, who in the improver in full,
NHA and to pay NHA built, sown or planted
turn sold it for based on the current
rent of 200 pesos in good faith, shall
from the time it took have the right to P103,000 to the market value of the
possession of the lot. appropriate as his spouses Juan and property.
Respondent own the works, Erlinda Nuguid. Under Article
Church appealed to sowing or planting, Pecson 448, the landowner is
the CA which affirms after payment of the challenged the validity given the option,
the decision of RTC indemnity provided of the auction sale
regarding no contract for in articles 546 and either to appropriate
before the RTC of the improvement as
of sale but modifying 548, or to oblige the
it by ordering NHA to one who built or Quezon City, the RTC his own upon
execute the sale of planted to pay the upheld the spouses payment of the proper
the said lots to price of the land, and title but declared that amount of indemnity
Church for 700 per the one who sowed, the four-door two- or to sell the land to
square, with 6% the proper rent. storey apartment the possessor in good
interest per annum However, the builder building was not
from March 1991. or planter cannot be faith. Relatedly,
included in the Article 546 provides

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 PROPERTY CASE DIGESTS

that a builder in good paying any amount to improvements on the that petitioners are
faith is entitled to full the latter as property. not entitled to the just
reimbursement for all reimbursement for his Petitioners compensation they
the necessary and construction costs alleged that they were seek through the
useful expenses and expenses. They entitled to just present complaint.
incurred; it also gives should account and compensation relating Under Article 448 of
him right of retention pay for such benefits. to the value of the the Civil Code, the
until full houses they had built builder in bad faith on
reimbursement is G.R. NO. 157605. on the property, owing the land of another
made. DECEMBER 13, to their purported loses what is built
The right of 2005 status as builders in without right to
retention is SPS. RASDAS, ET. good faith. They indemnity. Petitioners
considered as one of AL. VS. ESTENOR, claimed that the CA were in bad faith
the measures devised ET. AL. decision did not when they built the
by the law for the declare them as structures as they had
protection of builders FACTS: builders in bad faith, known that the
in good faith. Its The dispute and thus, they were subject property did
object is to guarantee centers on a parcel of entitled to be not belong to them.
full and prompt land with an situated reimbursed of the
reimbursement as it in Ilagan, Isabela. value of their houses G.R. NO. 123672.
permits the actual Respondent filed a before these could be DECEMBER 14,
possessor to remain Complaint For demolished. They 2005
in possession while Recovery Of posited that without FERNANDO
he has not been Ownership And such reimbursement, CARRASCOSO, JR.
reimbursed (by the Possession With they could not be VS. COURT OF
person who defeated Damages against. ejected from their APPEALS, LAURO
him in the case for The complaint was houses. LEVISTE
possession of the docketed and tried by
property) for those the RTC of Ilagan. In ISSUE: FACTS:
necessary expenses the same complaint, WON petitioners are El Dorado
and useful respondent asserted in good faith. Plantation, Inc. (El
improvements made that he was the owner Dorado) was the
by him on the thing of the subject HELD: NO. registered owner of a
possessed. property, which was The father of land situated in
Given the then in the the petitioners (and Sablayan, Occidental
circumstances of the possession of their predecessor-in- Mindoro. At a special
instant case where petitioners. The RTC interest) had already meeting of El
the builder in good decided in favor of known that he did not Dorados Board of
faith has been clearly petitioners. The CA own the property, and Directors, a
denied his right of reversed the that his stay therein Resolution was
retention for almost judgment of the RTC was merely out of passed authorizing
half a decade, we find and declared tolerance. Such Feliciano Leviste,
that the increased respondent as the conclusion in fact then President of El
award of rentals by owner of the subject bolstered the eventual Dorado, to negotiate
the RTC was property. Thereafter, a conclusion that the sale of the
reasonable and Writ of Execution and respondents were the property and sign all
equitable. The Writ of Demolition owners of the land documents and
petitioners had was issued against and that petitioners contracts bearing
reaped all the benefits petitioners, who were should vacate the thereof. Through a
from the improvement ordered to demolish same. Deed of Sale of Real
introduced by the their houses, These Property, El Dorado,
respondent during structures, and premises remaining through Feliciano
said period, without as they are, it is clear Leviste, sold the

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 PROPERTY CASE DIGESTS

property to when the Notice of Lis payment of rent On July,

Carrascoso, Jr. Pendens was should continue up to 1989, however,
PLDT annotated on the actual transfer of Piazza Hotel was sold
commenced Carrascosos TCT No. ownership. at a public auction for
construction of T-6055, PLDT is non-payment of taxes
improvements on the deemed to have been to respondent
1,000 hectare portion in good faith in G.R. NO. 144635 Province of Bataan.
of the property introducing JUNE 26, 2006 The title of the
immediately after the improvements on the PROGRAMME property was
execution of 1,000 hectare portion INCORPORATED, V. transferred to
Agreement to Buy of the property. After PROVINCE OF respondent.
and Sell. March 15, 1977, BATAAN BASECOs Transfer
Lauro however, PLDT could Certificate of Title was
Leviste (Lauro), a no longer invoke the FACTS: cancelled and a new
stockholder and rights of a builder in BASECO is one, was issued to
member of the Board good faith. the owner of Piazza the Province of
of Directors of El Should El Hotel and Mariveles Bataan.
Dorado, through his Dorado then opt to Lodge, both located in The trial
counsel, Atty. appropriate the Mariveles, Bataan. court rendered
Benjamin Aquino, improvements made In 1986, judgment in favor of
called the attention of by PLDT on the 1,000 BASECO granted respondent.
the Board to hectare portion of the petitioner a contract CA affirmed
Carrascosos failure property, it should of lease over Piazza the trial courts ruling.
to pay the balance of only be made to pay Hotel at a monthly
the purchase price of for those rental of P6,500 for ISSUE:
the property. He improvements at the three years, subject to WON the
wants a rescission of time good faith renewal by mutual petitioner is a
the sale made by the existed on the part of agreement of the possessor in good
El Dorado Plantation, PLDT or until March parties. After the faith of the Piazza
Inc. to Mr. 15, 1977, to be expiration of the Hotel and Mariveles
Carrascoso. pegged at its current three-year lease Lodge
fair market value. period, petitioner was
ISSUE: WON PLDT is The allowed to continue HELD:
in good faith when it commencement of operating the hotel on The benefits
built its improvements PLDTs payment of monthly extensions of granted to a
on the subject land. reasonable rent the lease. possessor in good
should start on March In 1989, faith cannot be
HELD: 15, 1977 as well, to however, the maintained by the
In the case be paid until such Presidential lessee against the
at bar, it is undisputed time that the Commission on Good lessor because, such
that PLDT possession of the Government (PCGG) benefits are intended
commenced 1,000 hectare portion issued a to apply only to a
construction of is delivered to El sequestration order case where one
improvements on the Dorado, subject to the against BASECO builds or sows or
1,000 hectare portion reimbursement of pursuant to Executive plants on land which
of the property expenses as Order No. 1 of former he believes himself to
immediately after the aforestated, that is, if President Corazon C. have a claim of title
execution of the July El Dorado opts to Aquino. Among the and not to lands
11, 1975 Agreement appropriate the properties wherein ones only
to Buy and Sell with improvements. provisionally seized interest is that of a
the full consent of If El Dorado and taken over was tenant under a rental
Carrascoso. Thus, opts for compulsory the lot on which contract, otherwise, it
until March 15, 1977 sale, however, the Piazza Hotel stood. would always be in

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 PROPERTY CASE DIGESTS

the power of a tenant upon termination of approved the amicable improvements if the
to improve his the lease under settlement however the lessor so elects.
landlord out of his Article 1678 of the petitioner failed to
property. Besides, as Civil Code. comply with the terms.
between lessor and G.R. NO.157044.
lessee, the Code ISSUE: OCTOBER 5, 2005
applies specific G.R. NO. L-26694 WON petitioner is a ROSALES VS.
provisions designed DECEMBER 18, 1973 builder in good faith CASTELLFORT
to cover their rights. NELITA MORENO and, therefore, entitled
Hence, the VDA. DE BACALING to reimbursement, FACTS:
lessee cannot claim V HECTOR LAGUNA and/or reasonable Spouses-
reimbursement, as a expenses that may be petitioners Rodolfo V.
matter of right, for FACTS: incurred in transferring Rosales and Lily
useful improvements Hector the house to another Rosqueta-Rosales
he has made on the Laguda is the place (petitioners) are the
property, nor can he registered owner of a registered owners of a
assert a right of residential land HELD: parcel of land with an
retention until situated at La Paz, Petitioner's area of approximately
reimbursed. His only Iloilo City. Many years contention that she be 315 square meters,
remedy is to remove back, petitioner and considered a builder in covered by Transfer
the improvement if her late husband, Dr. good faith and, Certificate of Title
the lessor does not Ramon Bacaling, with therefore, entitled to (TCT) No. 36856[4]
choose to pay its the acquiescence of reimbursement in and designated as Lot
value; but the court private respondent addition to reasonable 17, Block 1 of
cannot give him the Laguda, constructed a expenses that may be Subdivision Plan LRC
right to buy the land. residential house on a incurred in transferring Psd-55244 situated in
Petitioners portion of said lot the house to another Los Baos, Laguna.
assertion that Piazza fronting Huevana place, the same cannot On August
Hotel was constructed Street, paying a stand legal scrutiny. 16, 1995, petitioners
"at (its) expense" monthly rental of The rule is well-settled discovered that a
found no support in P80.00. Unable to pay that lessees, like house was being
the records. Neither the lease rental from petitioner, are not constructed on their
did any document or July 1959 to possessors in good lot, without their
testimony prove this September 1961, faith, because they knowledge and
claim. At best, what totalling P2,160.00, an knew that their consent, by
was confirmed was action for ejectment occupancy of the respondent Miguel
that petitioner was filed by private premises continues Castelltort (Castelltort).
managed and respondent Laguda only during the life of It turned out
operated the hotel. against petitioner in the lease, and they that respondents
There was no her capacity as judicial cannot as a matter of Castelltort and his wife
evidence that administratrix of the right, recover the value Judith had purchased
petitioner was the one estate of her late of their improvements a lot, Lot 16 of the
which spent for the husband, Dr. Bacaling. from the lessor, much same Subdivision
construction or The filing of said case less retain the Plan, from respondent
renovation of the spawned various court premises until they are Lina Lopez-Villegas
property. And since suits. reimbursed. Their (Lina) through her son-
petitioners alleged Petitioner rights are governed by attorney-in-fact Rene
expenditures were suffered a series of Article 1678 of the Civil Villegas (Villegas) but
never proven, it could legal reverses and Code which allows that after a survey
not even seek ended up with a reimbursement of thereof by geodetic
reimbursement of compromise lessees up to one-half engineer Augusto
one-half of the value agreement with the of the value of their Rivera, he pointed to
of the improvements respondent. Trial court Lot 17 as the Lot 16

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 PROPERTY CASE DIGESTS

the Castelltorts 448), the landowner it becomes the

purchased. can choose between necessary to ownership of
appropriating the protect the the
Negotiations for the building by paying the owner of the accessory
settlement of the case proper indemnity or improvement thing.
thus began, with obliging the builder to s without
Villegas offering a pay the price of the causing
larger lot near land, unless its value is injustice to G.R. NO. 170923
petitioners lot in the considerably more the owner of JANUARY 20, 2009
same subdivision as a than that of the the land. In SULO SA NAYON,
replacement thereof. In structures, in which view of the INC. VS NAYONG
the alternative, Villegas case the builder in impracticabilit PILIPINO
proposed to pay the good faith shall pay y of creating FOUNDATION
purchase price of reasonable rent.[34] If a state of
petitioners lot with the parties cannot forced co- FACTS:
legal interest. Both come to terms over the ownership, In 1975,
proposals were, conditions of the lease, the law has respondent leased a
however, rejected by the court must fix the provided a portion of the Nayong
petitioners whose terms thereof. just solution Pilipino Complex, to
counsel, by letter of The choice by giving the petitioner Sulo sa
August 24, 1995, belongs to the owner owner of the Nayon, Inc. for the
directed Castelltort to of the land, a rule that land the construction and
stop the construction of accords with the option to operation of a hotel
and demolish his principle of accession, acquire the building, to be known
house and any other i.e., that the accessory improvement as the Philippine
structure he may have follows the principal s after Village Hotel. The
built thereon, and and not the other way payment of lease was for an initial
desist from entering around. Even as the the proper period of 21 years, or
the lot. option lies with the indemnity, or until May 1996. It is
Petitioners landowner, the grant to to oblige the renewable for a
subsequently filed on him, nevertheless, is builder or period of 25 years
September 1, 1995 a preclusive. The planter to pay under the same terms
complaint for recovery landowner cannot for the land and conditions upon
of possession and refuse to exercise and the due notice in writing
damages with prayer either option and sower the to respondent of the
for the issuance of a compel instead the proper rent. intention to renew.
restraining order and owner of the building to He cannot In 1995,
preliminary injunction remove it from the refuse to petitioners sent
against spouses- land. exercise respondent a letter
respondents Miguel The raison either option. notifying the latter of
and Judith Castelltort detre for this provision It is the their intention to
before the RTC of has been enunciated owner of the renew the contract for
Calamba, Laguna, thus: land who is another. July of the
docketed as Civil Case Where the authorized to same year, parties
No. 2229-95-C. builder, exercise the agreed to the renewal
planter or option, of the contract for
ISSUE: sower has because his another 25 years, or
Under Art 448, who acted in good right is older, until 2021. Under the
has the right of option? faith, a and because, new agreement,
conflict of by the petitioner PVHI was
HELD: rights arises principle of bound to pay the
Under the between the accession, he monthly rentals
foregoing provision (Art owners, and is entitled to

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 PROPERTY CASE DIGESTS

Beginning claim or title to the 96 SCRA 130 ruled based on Art,

January 2001, land. In fact, as February 21, 1980 448 of the Civil Code
petitioners defaulted lessees, they FLOREZA v saying that
in the payment of recognize that the EVANGELISTA Evangelistas have the
their monthly rental. respondent is the choice between
Respondent owner of the land. FACTS: purchasing the house
repeatedly demanded What petitioners insist The or selling the land to
petitioners to pay the is that because of the Evangelistas were the Floreza. CA ruled
arrears and vacate improvements, which owner of a residential that Art. 448 was
the premises. are of substantial lot in Rizal with an inapplicable and that
MeTC value, that they have area of 204.08 sq. m. Floreza was not
rendered its decision introduced on the assessed at P410. entiled to the
in favor of respondent leased premises with They borrowed P100 reimbursement of his
RTC which the permission of from Floreza. Floreza house and could
modified the ruling of respondent, they occupied the remove the same at
the MeTC. should be considered residential lot and his own expense.
CA which builders in good faith built a house of light
held that the RTC who have the right to material (barong- ISSUE:
erroneously applied retain possession of barong) with the 1. WON Floreza was
the rules on the property until consent of the entitled to
accession, as found reimbursement by Evangelistas. reimbursement of the
in Articles 448 and respondent. Additional Loans were cost of his house.
546 of the Civil Code We affirm made by the 2. WON he (his heirs
the ruling of the CA Evangelistas. who replaced him)
ISSUE: that introduction of Floreza should pay rental of
WON Sulo valuable demolished the house the land.
sa Nayon as builders improvements on the of light material and
have acted in good leased premises does constructed one of HELD:
faith in order for Art. not give the strong material 1. NO.
448 in relation to Art. petitioners the right of assessed. Floreza Issue of
546 of the Civil Code retention and has not been paying reimbursement is not
may apply with reimbursement which any rentals since the moot because if
respect to their rights rightfully belongs to a beginning of their Floreza has no right
over improvements. builder in good faith. transactions. of retention, then he
Otherwise, such a Eventually, must pay damages in
HELD: situation would allow Evangelistas sold, the form of rentals.
Article 448 is the lessee to easily with a right to Agree with CA that
manifestly intended to "improve" the lessor repurchase within 6 Art. 448 is
apply only to a case out of its property. We years, their land to inapplicable because
where one builds, reiterate the doctrine Floreza. Seven it applies only when
plants, or sows on that a lessee is months before the the builder is in good
land in which he neither a builder in expiry of the faith (he believed he
believes himself to good faith nor in bad repurchase period, had a right to build).
have a claim of title, faith that would call for the Evangelistas were Art. 453 is also not
and not to lands the application of able to pay in full. applicable because it
where the only Articles 448 and 546 Floreza refused to requires both of the
interest of the builder, of the Civil Code. His vacate the lot unless parties to be in bad
planter or sower is rights are governed he was first faith. Neither is Art.
that of a holder, such by Article 1678 of the reimbursed for the 1616 applicable
as a tenant. Civil Code. value of the house he because Floreza is
In the case built not a vendee a retro.
at bar, petitioners Evangelistas The house was
have no adverse filed a complaint. CFI already constructed in

Digested and compiled by Chami, Daisy, James, Moneh, and Relie UST LAW 2B
 PROPERTY CASE DIGESTS

1945 (light materials) demands but to no HELD: NO.

even before the pacto avail, prompting them Petitio
de retro was entered to bring the matter to ner is not a
into in 1949. Floreza the barangay. But the builder in good
cannot be classified parties failed to reach faith.
as a builder in good an amicable Considering
faith nor a vendee a settlement. On June that he
retro, who made 25, 1999, the occupies the
ART. 449
useful improvements barangay chairman land by mere
during the pacto de issued a Certification tolerance, he is
retro, he has no right DEL ROSARIO V. to File Action. aware that his
to reimbursement of SPS. MANUEL In his occupation of
the value of the answer to the the same may
house, much less to FACTS: complaint, petitioner be terminated
the retention of the On August claimed that by respondents
premises until he is 12, 1999, spouses sometime in 1968, any time.
paid. Jose and Concordia respondents allowed
His rights Manuel, respondents, him to build his house
are more akin to a filed with the on the lot, provided
usufructury under Art. Municipal Trial Court he would guard the SPS. RASDAS VS.
579, who may make (MTC), San Mateo, premises to prevent ESTENOR
Rizal a complaint1 for (Similar to the
on the property useful landgrabbers and
previous article)
improvements but unlawful detainer squatters from
with no right to be against Alfredo Yasay occupying the area.
LUMUNGO V.
indemnified thereof, del Rosario, In 1995, when USMAN
He may, however, petitioner, docketed respondents visited 25 SCRA 255
remove such as Civil Case No. this country, they
improvements should 1360. They alleged agreed verbally to sell FACTS:
it be possible to do so that they are the true the portion on which Dominga
without damage to the and lawful owners of his house was Usman sold and
property. a 251 square meter constructed. A year transfers her rights in
lot located at Sta. later, he made an and to the 3 lots in
question to Jose
2. YES. Ana, San Mateo, offer to buy the 60
Angeles. The latter
From the time the Rizal. Because of square meter portion made the purchase
redemption price was their compassion, occupied by him and with the knowledge
paid in January 3, they allowed to spend for its that the property was
1955, Florezas right petitioner, whose survey. But what already in dispute by
to use the residential house was destroyed respondents wanted Atty. Usman, husband
lot without rent by a strong typhoon, to sell was the whole of Dominga, and by
the plaintiffs. Angeles,
ceased. He should be to occupy their lot. area containing 251
upon taking
held liable for They agreed that he square meters. He possession of the
damages in the form could build thereon a then informed them land, planted the
of rentals for the temporary shelter of that he would first same with coconuts,
continued use of the light materials. But consult his children which, together with
lot for P10 monthly without their consent, and they said they will those already planted
what he constructed by Dominga Usman,
from January 3, 1955 wait. Instead, they
numbered about
until the house was was a house of filed the instant 3,000, most of which
removed and the concrete materials. complaint. are now fruit-bearing.
property vacated by In 1992, respondents In short, Angeles was
Floreza or his heirs. asked petitioner to ISSUE: a purchaser and a
Judgment affirmed vacate the lot. This WON petitioner is a builder in bad faith.
with modification. was followed by builder in good faith.
ISSUE:
repeated verbal

Digested and compiled by Chami, Daisy, James, Moneh, and Relie UST LAW 2B
 PROPERTY CASE DIGESTS

Whether or not alleged that he was owner of the latter, rendered a decision in
Angeles is entitled to the owner of the the rights of both shall favor of Colegio de
reimbursement for the property. The be the same as if they San Jose ordering the
coconuts tree he defendant admitted in had acted in good registration of the 2
planted on the writing that he knew faith. The Supreme parcels of land in
property in litigation. that the land is owned declared that the accordance with law.
by the Municipality Municipality is the Both admitted that the
HELD: and that Jose Castillo, owner of the land and strip was formerly
No. It should whom he bought the that it has the option covered by water but
be noted that said property did not own of buying the building since the Bay
trees are the land. When Roa thereon, which is the receded, it was now
improvements, not constructed a property of the uncovered. The
"necessary expenses substantial building defendant, or of government tried to
of preservation," on the property in selling to him the land apply Art. 458 which
which a builder, question after he on which it stands. states the adjoin
planter or sower in acquired the estate (the College)
bad faith may recover property from Castillo, does not acquire the
under Arts. 452 and the Municipality did land left dry by the
546, first paragraph, not oppose the ART. 458 natural decrease of
of the Civil Code. construction. the waters.
The facts and findings GOVERNMENT V.
of both the trial court ISSUE: COLEGIO DE SAN ISSUES:
and the Court of Whether or not the JOSE Whether or not Art.
Appeals leave no municipality owns the 53 PHIL. 423 458 is applicable.
room for doubt that land. Whether or not the
Jose Angeles was a property in question
FACTS:
purchaser and a HELD: belongs to the public
During the
builder in bad faith. Yes. The domain as a part of
months of September
The provision defendant was not a the bed of Laguna de
to November every
applicable to this case purchaser in good Bay.
year, the waters of
is, accordingly, Article faith. The plaintiff, Laguna de Bay cover
449 of the Civil Code, having permitted the HELD:
a long strip of land
which provides that, erection by the No. Article 367 (now
along the eastern
"he who builds, plants defendant of a Art.458) provides that
border of the two
or sows in bad faith building on the land the owners of estates
parcels of land in
on the land of without objection, bordering on ponds or
question. The
another, loses what is acted in bad faith. lagoons, do not
claimant Colegio de
built, planted or sown The rights of the acquire the land left
San Jose contends
without right to parties must, dry by the natural
that the parcels of
indemnity." therefore, be decrease of the
land are a part of the
determined as if they waters, nor lose those
Hacienda de San
both had acted in inundated by them in
Pedro Tunasan
good faith. To the extraordinary floods.
belonging it, which
case are applicable The provision refers
has been in
ART. 453 those provisions of possession thereof
to ponds and lagoons,
the Civil Code which and has therefore no
since time
relate to the application to the
MUNICIPALITY OF immemorial by means
construction by one present case, which
OAS V. ROA of its tenants or
person of a building refers to a lake, a
7 PHIL. 20 lessees and farmers.
upon land belonging lagoon being legally
In contrast, the
to another. Article 364 distinct in character
FACTS: Government contends
(now Art.453) of the from a lake. Instead,
The that the said two
Civil Code is as Art.77 of the Spanish
Municipality brought parcels of land belong
follows: "When there Law of Waters should
the action for the to the public domain,
has been bad faith, apply, which provides:
recovery of a tract of and its evidence
not only on the part of Lands accidentally
land in the pueblo of tends to prove that
the person who built, inundated by the
Oas, claiming that it they have always
sowed, or planted on waters of lakes, or by
was a part of the been known as the
another's land, but creeks, rivers or other
public square of said shores of Laguna de
also on the part of the streams shall
town, while Roa Bay. The CFI

Digested and compiled by Chami, Daisy, James, Moneh, and Relie UST LAW 2B
 PROPERTY CASE DIGESTS

continue to be the
property of their
respective owners.
Therefore, they must
belong to Colegio de
San Jose as part of
Hacienda de San
Pedro Tunasan,
which was originally
owned by it.

Digested and compiled by Chami, Daisy, James, Moneh, and Relie UST LAW 2B