SECOND DIVISION
petitioner's property but not after they are reimbursed for the value of the house
[G.R. No. 152809. August 3, 2006.]
MERCEDES MORALIDAD, petitioner, vs. SPS. DIOSDADO PERNES and ARLENE
PERNES, respondents.
DECISION
GARCIA, J p:
Under consideration is this petition for review on certiorari under Rule 45 of the
Rules of Court to nullify and set aside the following issuances of the Court of
Appeals (CA) in CA-G.R. SP No. 61610, to wit:
1. Decision dated September 27, 2001, 1 affirming an earlier decision of the
Regional Trial Court (RTC) of Davao City which reversed that of the Municipal Trial
Court in Cities (MTCC), Davao City, Branch 1, in an action for unlawful detainer
thereat commenced by the petitioner against the herein respondents; and
2. Resolution dated February 28, 2002, 2 denying petitioner's motion for
reconsideration.
At the heart of this controversy is a parcel of land located in Davao City and
registered in the name of petitioner Mercedes Moralidad under Transfer
Certificate of Title (TCT) No. T-123125 of the Registry of Deeds of Davao City.
In her younger days, petitioner taught in Davao City, Quezon City and Manila.
While teaching in Manila, she had the good fortune of furthering her studies at
the University of Pennsylvania, U.S.A. While schooling, she was offered to teach
at the Philadelphia Catholic Archdiocese, which she did for seven (7) years.
Thereafter, she worked at the Mental Health Department of said University for
the next seventeen (17) years.
During those years, she would come home to the Philippines to spend her two-
month summer vacation in her hometown in Davao City. Being single, she would
usually stay in Mandug, Davao City, in the house of her niece, respondent Arlene
Pernes, a daughter of her younger sister, Rosario.
Back in the U.S.A. sometime in 1986, she received news from Arlene that Mandug
at the outskirts of Davao City was infested by NPA rebels and many women and
children were victims of crossfire between government troops and the insurgents.
Shocked and saddened about this development, she immediately sent money to
Araceli, Arlene's older sister, with instructions to look for a lot in Davao City where
Arlene and her family could transfer and settle down. This was why she bought
the parcel of land covered by TCT No. T-123125.
Petitioner acquired the lot property initially for the purpose of letting Arlene move
from Mandug to Davao City proper but later she wanted the property to be also
available to any of her kins wishing to live and settle in Davao City. Petitioner
made known this intention in a document she executed on July 21, 1986. 3 The
document reads:
I, MERCEDES VIÑA MORALIDAD, of legal age, single, having been born on the 29th
day of January, 1923, now actually residing at 8021 Lindbergh Boulevard,
Philadelphia, Pennsylvania, U.S.A., wishes to convey my honest intention
regarding my properties situated at Palm Village Subdivision, Bajada, Davao City,
9501, . . . and hereby declare:
1. That it is my desire that Mr. and Mrs. Diosdado M. Pernes may build their house
therein and stay as long as they like;
2. That anybody of my kins who wishes to stay on the aforementioned real
property should maintain an atmosphere of cooperation, live in harmony and
must avoid bickering with one another;
3. That anyone of my kins may enjoy the privilege to stay therein and may avail
the use thereof. Provided, however, that the same is not inimical to the purpose
thereof;
4. That anyone of my kins who cannot conform with the wishes of the undersigned
may exercise the freedom to look for his own;
5. That any proceeds or income derived from the aforementioned properties shall
be allotted to my nearest kins who have less in life in greater percentage and
lesser percentage to those who are better of in standing.
xxx xxx xxx
Following her retirement in 1993, petitioner came back to the Philippines to stay
with the respondents' on the house they build on the subject property. In the
course of time, their relations turned sour because members of the Pernes family
were impervious to her suggestions and attempts to change certain practices
concerning matters of health and sanitation within their compound. For instance,
Arlene's eldest son, Myco Pernes, then a fourth year veterinary medicine student,
would answer petitioner back with clenched fist and at one time hurled
profanities when she corrected him. Later, Arlene herself followed suit. Petitioner
brought the matter to the local barangay lupon where she lodged a complaint for
slander, harassment, threat and defamation against the Pernes Family. Deciding
1
for petitioner, the lupon apparently ordered the Pernes family to vacate
they built thereon. Unfortunately, the parties could not agree on the amount, thus
prolonging the impasse between them.
Other ugly incidents interspersed with violent confrontations meanwhile
transpired, with the petitioner narrating that, at one occasion in July 1998, she
sustained cuts and wounds when Arlene pulled her hair, hit her on the face, neck
and back, while her husband Diosdado held her, twisting her arms in the process.
Relations having deteriorated from worse to worst, petitioner, on July 29, 1998,
lodged a formal complaint before the Regional Office of the Ombudsman for
Mindanao, charging the respondent spouses, who were both government
employees, with conduct unbecoming of public servants. This administrative case,
however, did not prosper.
Then, on August 3, 1998, petitioner filed with the MTCC of Davao City an unlawful
detainer suit against the respondent spouses. Petitioner alleged that she is the
registered owner of the land on which the respondents built their house; that
through her counsel, she sent the respondent spouses a letter demanding them
to vacate the premises and to pay rentals therefor, which the respondents refused
to heed. CSTDEH
In their defense, the respondents alleged having entered the property in question,
building their house thereon and maintaining the same as their residence with
petitioner's full knowledge and express consent. To prove their point, they invited
attention to her written declaration of July 21, 1986, supra, wherein she expressly
signified her desire for the spouses to build their house on her property and stay
thereat for as long as they like.
The MTCC, resolving the ejectment suit in petitioner's favor, declared that the
respondent spouses, although builders in good faith vis-à-vis the house they built
on her property, cannot invoke their bona fides as a valid excuse for not complying
with the demand to vacate. To the MTCC, respondents' continued possession of
the premises turned unlawful upon their receipt of the demand to vacate, such
possession being merely at petitioner's tolerance, and sans any rental.
Accordingly, in its decision dated November 17, 1999, 4 the MTCC rendered
judgment for the petitioner, as plaintiff therein, to wit:
WHEREFORE, judgment is hereby rendered in favor of herein plaintiff and against
the defendants, as follows:
a) Directing the defendants, their agents and other persons acting on their behalf
to vacate the premises and to yield peaceful possession thereof to plaintiff;
b) Ordering defendants to pay P2,000.00 a month from the filing of this complaint
until they vacate premises;
c) Sentencing defendants to pay the sum of P120,000.00 5 as attorney's fees and
to pay the cost of suit.
Defendants counterclaim are hereby dismissed except with respect to the claim
for reimbursement of necessary and useful expenses which should be litigated in
an ordinary civil actions. (sic)
Dissatisfied, the respondent spouses appealed to the RTC of Davao City.
In the meantime, petitioner filed a Motion for Execution Pending Appeal. The
motion was initially granted by the RTC in its Order of February 29, 2000, but the
Order was later withdrawn and vacated by its subsequent Order dated May 9,
2000 6 on the ground that immediate execution of the appealed decision was not
the prudent course of action to take, considering that the house the respondents
constructed on the subject property might even be more valuable than the land
site.
Eventually, in a decision 7 dated September 30, 2000, the RTC reversed that of
the MTCC, holding that respondents' possession of the property in question was
not, as ruled by the latter court, by mere tolerance of the petitioner but rather by
her express consent. It further ruled that Article 1678 of the Civil Code on
reimbursement of improvements introduced is inapplicable since said provision
contemplates of a lessor-lessee arrangement, which was not the factual milieu
obtaining in the case. Instead, the RTC ruled that what governed the parties'
relationship are Articles 448 and 546 of the Civil Code, explaining thus:
Since the defendants-appellees [respondents] are admittedly possessors of the
property by permission from plaintiff [petitioner], and builders in good faith, they
have the right to retain possession of the property subject of this case until they
have been reimbursed the cost of the improvements they have introduced on the
property.
Indeed, this is a substantive right given to the defendants by law, and this right is
superior to the procedural right to [sic] plaintiff to immediately ask for their
removal by a writ of execution by virtue of a decision which as we have shown is
erroneous, and therefore invalid. (Words in brackets supplied),
and accordingly dismissed petitioner's appeal, as follows:
WHEREFORE, in view of the foregoing, the Decision appealed from is REVERSED
and declared invalid. Consequently, the motion for execution pending appeal is
likewise denied.
Counter-claims of moral and exemplary damages claimed by defendants are
likewise dismissed. However, attorney's fees in the amount of fifteen thousand
pesos is hereby awarded in favor of defendants-appellants, and against plaintiffs.
SO ORDERED. 8
Therefrom, petitioner went to the CA in CA-G.R. SP No. 61610.
On September 27, 2001, the CA, while conceding the applicability of Articles 448
and 546 of the Civil Code to the case, ruled that it is still premature to apply the
same considering that the issue of whether respondents' right to possess a
portion of petitioner's land had already expired or was already terminated was
not yet resolved. To the CA, the unlawful detainer suit presupposes the cessation
of respondents' right to possess. The CA further ruled that what governs the rights
of the parties is the law on usufruct but petitioner failed to establish that
respondents' right to possess had already ceased. On this premise, the CA
concluded that the ejectment suit instituted by the petitioner was premature. The
appellate court thus affirmed the appealed RTC decision, disposing:
WHEREFORE, premises considered, the instant petition for review is hereby
denied for lack of merit. Accordingly, the petitioner's complaint for Unlawful
Detainer is DISMISSED.
SO ORDERED.
With the CA's denial of her motion for reconsideration in its Resolution of
February 28, 2002, petitioner is now before this Court raising the following issues:
I. WHETHER OR NOT THE COURT OF APPEALS ERRED IN DISMISSING THE
UNLAWFUL DETAINER CASE FOR BEING PREMATURE WHICH DECISION IS NOT IN
ACCORDANCE WITH LAW AND JURISPRUDENCE.
II. WHETHER OR NOT THE COURT OF APPEALS ERRED IN APPLYING ARTICLES 448
AND 546 AND THE PROVISIONS OF THE CODE ON USUFRUCT INSTEAD OF ARTICLE
1678 OF THE CIVIL CODE.
The Court rules for the petitioner.
The Court is inclined to agree with the CA that what was constituted between the
parties herein is one of usufruct over a piece of land, with the petitioner being the
owner of the property upon whom the naked title thereto remained and the
respondents being two (2) among other unnamed usufructuaries who were
simply referred to as petitioner's kin. The Court, however, cannot go along with
the CA's holding that the action for unlawful detainer must be dismissed on
ground of prematurity.
Usufruct is defined under Article 562 of the Civil Code in the following wise:
ART. 562. Usufruct gives a right to enjoy the property of another with the
obligation of preserving its form and substance, unless the title constituting it or
the law otherwise provides.
Usufruct, in essence, is nothing else but simply allowing one to enjoy another's
property. 9 It is also defined as the right to enjoy the property of another
temporarily, including both the jus utendi and the jus fruendi, 10 with the owner
retaining the jus disponendi or the power to alienate the same. 11
It is undisputed that petitioner, in a document dated July 21, 1986, supra, made
known her intention to give respondents and her other kins the right to use and
to enjoy the fruits of her property. There can also be no quibbling about the
respondents being given the right "to build their own house" on the property and
to stay thereat "as long as they like." Paragraph #5 of the same document
earmarks "proceeds or income derived from the aforementioned properties" for
the petitioner's "nearest kins who have less in life in greater percentage and lesser
percentage to those who are better of (sic) in standing." The established facts
undoubtedly gave respondents not only the right to use the property but also
granted them, among the petitioner's other kins, the right to enjoy the fruits
thereof. We have no quarrel, therefore, with the CA's ruling that usufruct was
constituted between petitioner and respondents. It is thus pointless to discuss
why there was no lease contract between the parties.
However, determinative of the outcome of the ejectment case is the resolution
of the next issue, i.e., whether the existing usufruct may be deemed to have been
extinguished or terminated. If the question is resolved in the affirmative, then the
respondents' right to possession, proceeding as it did from their right of usufruct,
likewise ceased. In that case, petitioner's action for ejectment in the unlawful
detainer case could proceed and should prosper. EcATDH
The CA disposed of this issue in this wise:
. . . Section 1, Rule 70 of the 1997 Rules of Civil Procedure, as amended, provides
...
2
xxx xxx xxx
From the foregoing provision, it becomes apparent that for an action for unlawful
detainer to prosper, the plaintiff [petitioner] needs to prove that defendants'
[respondents'] right to possess already expired and terminated. Now, has
respondents' right to possess the subject portion of petitioner's property expired
or terminated? Let us therefore examine respondents' basis for occupying the
same.
It is undisputed that petitioner expressly authorized respondents o occupy
portion of her property on which their house may be built. Thus — "it is my desire
that Mr. and Mrs. Diosdado M. Pernes may build their house therein and stay as
long as they like." From this statement, it seems that petitioner had given the
respondents the usufructuary rights over the portion that may be occupied by the
house that the latter would build, the duration of which being dependent on how
long respondents would like to occupy the property. While petitioner had already
demanded from the respondents the surrender of the premises, this Court is of
the opinion that the usufructuary rights of respondents had not been terminated
by the said demand considering the clear statement of petitioner that she is
allowing respondents to occupy portion of her land as long as the latter want to.
Considering that respondents still want to occupy the premises, petitioner clearly
cannot eject respondents. 12
We disagree with the CA's conclusion of law on the matter. The term or period of
the usufruct originally specified provides only one of the bases for the right of a
usufructuary to hold and retain possession of the thing given in usufruct. There
are other modes or instances whereby the usufruct shall be considered
terminated or extinguished. For sure, the Civil Code enumerates such other
modes of extinguishment:
ART. 603. Usufruct is extinguished:
(1) By the death of the usufructuary, unless a contrary intention clearly appears;
(2) By expiration of the period for which it was constituted, or by the fulfillment
of any resolutory condition provided in the title creating the usufruct;
(3) By merger of the usufruct and ownership in the same person;
(4) By renunciation of the usufructuary;
(5) By the total loss of the thing in usufruct;
(6) By the termination of the right of the person constituting the usufruct;
(7) By prescription. (Emphasis supplied.)
The document executed by the petitioner dated July 21, 1986 constitutes the title
creating, and sets forth the conditions of, the usufruct. Paragraph #3 thereof
states "[T]hat anyone of my kins may enjoy the privilege to stay therein and may
avail the use thereof. Provided, however, that the same is not inimical to the
purpose thereof" (Emphasis supplied). What may be inimical to the purpose
constituting the usufruct may be gleaned from the preceding paragraph wherein
petitioner made it abundantly clear "that anybody of my kins who wishes to stay
on the aforementioned property should maintain an atmosphere of cooperation,
live in harmony and must avoid bickering with one another." That the
maintenance of a peaceful and harmonious relations between and among kin
constitutes an indispensable condition for the continuance of the usufruct is
clearly deduced from the succeeding Paragraph #4 where petitioner stated
"[T]hat anyone of my kins who cannot conform with the wishes of the
undersigned may exercise the freedom to look for his own." In fine, the
occurrence of any of the following: the loss of the atmosphere of cooperation, the
bickering or the cessation of harmonious relationship between/among kin
constitutes a resolutory condition which, by express wish of the petitioner,
extinguishes the usufruct.
From the pleadings submitted by the parties, it is indubitable that there were
indeed facts and circumstances whereby the subject usufruct may be deemed
terminated or extinguished by the occurrence of the resolutory conditions
provided for in the title creating the usufruct, namely, the document adverted to
which the petitioner executed on July 21, 1986.
As aptly pointed out by the petitioner in her Memorandum, respondents' own
evidence before the MTCC indicated that the relations between the parties "have
deteriorated to almost an irretrievable level." 13 There is no doubt then that what
impelled petitioner to file complaints before the local barangay lupon, the Office
of the Ombudsman for Mindanao, and this instant complaint for unlawful
detainer before the MTCC is that she could not live peacefully and harmoniously
with the Pernes family and vice versa.
Thus, the Court rules that the continuing animosity between the petitioner and
the Pernes family and the violence and humiliation she was made to endure,
despite her advanced age and frail condition, are enough factual bases to consider
the usufruct as having been terminated.
To reiterate, the relationship between the petitioner and respondents respecting
the property in question is one of owner and usufructuary. Accordingly,
respondents' claim for reimbursement of the improvements they introduced on
the property during the effectivity of the usufruct should be governed by
applicable statutory provisions and principles on usufruct. In this regard, we cite
with approval what Justice Edgardo Paras wrote on the matter:
If the builder is a usufructuary, his rights will be governed by Arts. 579 and 580. In
case like this, the terms of the contract and the pertinent provisions of law should
govern (3 Manresa 215-216; se also Montinola vs. Bantug, 71 Phil. 449). 14
(Emphasis ours.)
By express provision of law, respondents, as usufructuary, do not have the right
to reimbursement for the improvements they may have introduced on the
property. We quote Articles 579 and 580 of the Civil Code:
Art. 579. The usufructuary may make on the property held in usufruct such useful
improvements or expenses for mere pleasure as he may deem proper, provided
he does not alter its form or substance; but he shall have no right to be
indemnified therefor. He may, however, remove such improvements, should it be
possible to do so without damage to the property. (Emphasis supplied.)
Art. 580. The usufructuary may set off the improvements he may have made on
the property against any damage to the same.
Given the foregoing perspective, respondents will have to be ordered to vacate
the premises without any right of reimbursement. If the rule on reimbursement
or indemnity were otherwise, then the usufructuary might, as an author pointed
out, improve the owner out of his property. 15 The respondents may, however,
remove or destroy the improvements they may have introduced thereon without
damaging the petitioner's property.
Out of the generosity of her heart, the petitioner has allowed the respondent
spouses to use and enjoy the fruits of her property for quite a long period of time.
They opted, however, to repay a noble gesture with unkindness. At the end of the
day, therefore, they really cannot begrudge their aunt for putting an end to their
right of usufruct. The disposition herein arrived is not only legal and called for by
the law and facts of the case. It is also right.
WHEREFORE, the petition is GRANTED. The assailed Decision and Resolution of
the CA are REVERSED and SET ASIDE. Accordingly, the decision of the MTCC is
REINSTATED with MODIFICATION that all of respondents' counterclaims are
dismissed, including their claims for reimbursement of useful and necessary
expenses.
No pronouncement as to costs.
SO ORDERED.
Puno, Sandoval-Gutierrez, Corona and Azcuna, JJ., concur.
FIRST DIVISION
[G.R. No. L-44428. September 30, 1977.]
AVELINO BALURAN, petitioner, vs. HON. RICARDO Y. NAVARRO, Presiding Judge,
Court of First Instance of Ilocos Norte, Branch I and ANTONIO OBEDENCIO,
respondents.
Alipio V. Flores for petitioner.
Rafael B. Ruiz for private respondent.
DECISION
MUÑOZ PALMA, J p:
Spouses Domingo Paraiso and Fidela Q. Paraiso were the owners of a residential
lot of around 480 square meters located in Sarrat, Ilocos Norte. On or about
February 2, 1964, the Paraiso executed an agreement entitled "BARTER" whereby
as party of the first part they agreed to "barter and exchange" with spouses
AVELINO and Benilda Baluran their residential lot with the latter's unirrigated
riceland situated in Sarrat, Ilocos Norte, of approximately 223 square meters
without any permanent improvements, under the following conditions:
"1. That both the Party of the First Part and the Party of the Second Part shall
enjoy the material possession of their respective properties; the Party of the First
Part shall reap the fruits of the unirrigated riceland and the Party of the Second
Part shall have a right to build his own house in the residential lot.
"2. Nevertheless, in the event any of the children of Natividad P. Obedencio,
daughter of the First Part, shall choose to reside in this municipality and build his
own house in the residential lot, the Party of the Second Part shall be obliged to
return the lot such children with damages to be incurred.
"3. That neither the Party of the First Part nor the Party of the Second Part shall
encumber, alienate or dispose of in any manner their respective properties as
bartered without the consent of the other.
3
"4. That inasmuch as the bartered properties are not yet registered in accordance
with Act No. 496 or under the Spanish Mortgage Law, they finally agreed and
covenant that this deed be registered in the Office of the Register of Deeds of
Ilocos Norte pursuant to the provisions of Act No. 3344 as amended." (P. 28, rollo)
On May 6, 1975 Antonio Obendencio filed with the Court of First Instance of Ilocos
Norte the present complaint to recover the above-mentioned residential lot from
Avelino Baluran claiming that he is the rightful owner of said residential lot having
acquired the same from his mother, Natividad Paraiso Obedencio, and that he
needed the property for purposes of constructing his house thereon inasmuch as
he had taken residence in his native town, Sarrat. Obedencio accordingly prayed
that he be declared owner of the residential lot and that defendant Baluran be
ordered to vacate the same forfeiting his (Obedencio) favor the improvements
defendant Baluran had built in bad faith. 1
Answering the complaint, Avelino Baluran alleged inter alia (1) that the "barter
agreement" transferred to him the ownership of the residential lot in exchange
for the unirrigated riceland conveyed to plaintiff's predecessor-in-interest,
Natividad Obedencio, who in fact is still in possession thereof; and (2) that the
plaintiff's cause of action if any had prescribed. 2
At the pre-trial, the parties agreed to submit the case for decision on the basis of
their stipulation of facts. It was likewise admitted that the aforementioned
residential lot was donated on October 4, 1974 by Natividad Obedencio to her son
Antonio Obedencio, and that since the execution of the agreement of February 2,
1964 Avelino Baluran was in possession of the residential lot, paid the taxes of the
property, and constructed a house thereon with an assessed value of P250.00. 3
On November 8, 1975, the trial Judge Ricardo Y. Navarro rendered a decision the
dispositive portion of which reads as follows:
"Consequently, the plaintiff is hereby declared owner of the property in question,
the defendant is hereby ordered to vacate the same. With costs against
defendant."
Avelino Baluran to whom We shall refer as petitioner, now seeks a review of that
decision under the following assignment of errors: cdphil
"I — The lower Court erred in holding that the barter agreement did not transfer
ownership of the lot in suit to the petitioner.
"II — The lower Court erred in not holding that the right to re-barter or re-
exchange of respondent Antonio Obedencio had been barred by the statute of
limitation." (p. 14, ibid.)
The resolution of this appeal revolves on the nature of the undertaking or contract
of February 2, 1964 which is entitled "Barter Agreement."
It is a settled rule that to determine the nature of a contract courts are not bound
by the name or title given to it by the contracting parties. 4 This Court has held
that contracts are not what the parties may see fit to call them but what they
really are as determined by the principles of law. 5 Thus, in the instant case, the
use of the term "barter" in describing the agreement of February 2, 1964, is not
controlling. The stipulations in said document are clear enough to indicate that
there was no intention at all on the part of the signatories thereto to convey the
ownership of their respective properties; all that was intended, and it was so
provided in the agreement, was to transfer the material possession thereof.
(condition No. 1, see page 1 of this Decision) In fact, under condition No. 3 of the
agreement, the parties retained the right to alienate their respective properties
which right is an element of ownership.
With the material possession being the only one transferred, all that the parties
acquired was the right of usufruct which in essence is the right to enjoy the
property of another. 6 Under the document in question, spouses Paraiso would
harvest the crop of the unirrigated riceland while the other party, Avelino Baluran,
could build a house on the residential lot, subject, however, to the condition, that
when any of the children of Natividad Paraiso Obedencio, daughter of spouses
Paraiso, shall choose to reside in the municipality and build his house on the
residential lot, Avelino Baluran shall be obliged to return the lot to said children
"with damages to be incurred." (Condition No. 2 of the Agreement) Thus, the
mutual agreement — each party enjoying "material possession" of the other's
property — was subject to a resolutory condition the happening of which would
terminate the right of possession and use.
A resolutory condition is one which extinguishes rights and obligations already
existing. 7 The right of "material possession" granted in the agreement of
February 2, 1964, ends if and when any of the children of Natividad Paraiso
Obedencio (daughter of spouses Paraiso, party of the First Part) would reside in
the municipality and build his house on the property. Inasmuch as the condition
imposed is not dependent solely on the will of one of the parties to the contract
— the spouses Paraiso — but is partly dependent on the will of third persons —
Natividad Obedencio and any of her children — the same is valid. 8
When there is nothing contrary to law, morals, and good customs or public policy
in the stipulations of a contract, the agreement constitutes the law between the
parties and the latter are bound by the terms thereof. 9
Art. 1306 of the Civil Code states:

"Art. 1306. The contracting parties may establish such stipulations, clauses, terms
and conditions as they may deem convenient, provided they are not contrary to
law, morals, good customs, public order, or public policy."
"Contracts which are the private laws of the contracting parties, should be fulfilled
according to the literal sense of their stipulations, if their terms are clear and leave
no room for doubt as to the intention of the contracting parties, for contracts are
obligatory, no matter what their form may be, whenever the essential requisites
for their validity are present." (Philippine American General Insurance Co., Inc. vs.
Mutuc, 61 SCRA 22)
The trial court therefore correctly adjudged that Antonio Obedencio is entitled to
recover the possession of the residential lot pursuant to the agreement of
February 2, 1964. prcd
Petitioner submits under the second assigned error that the cause of action if any
of respondent Obedencio had prescribed after the lapse of four years from the
date of execution of the document of February 2, 1964. It is argued that the
remedy of plaintiff, now respondent, was to ask for re-barter or re exchange of
the properties subject of the agreement which could be exercised only within four
years from the date of the contract under Art. 1606 of the Civil Code.
The submission of petitioner is untenable. Art. 1606 of the Civil Code refers to
conventional redemption which petitioner would want to apply to the present
situation. However, as We stated above, the agreement of the parties of February
2, 1964, is not one of barter, exchange or even sale with right to repurchase, but
is one of or akin the other is the use or material possession or enjoyment of each
other's real property.
Usufruct may be constituted by the parties for any period of time and under such
conditions as they may deem convenient and beneficial subject to the provisions
of the Civil Code, Book II, Title VI on Usufruct. The manner of terminating or
extinguishing the right of usufruct is primarily determined by the stipulations of
the parties which in this case now before Us is the happening of the event agreed
upon. Necessarily, the plaintiff or respondent Obedencio could not demand for
the recovery of possession of the residential lot in question, not until he acquired
that right from his mother, Natividad Obedencio, and which he did acquire when
his mother donated to him the residential lot on October 4, 974. Even if We were
to go along with petitioner in his argument that the fulfillment of the condition
cannot be left to an indefinite, uncertain period, nonetheless, in the case at bar,
the respondent, in whose favor the resolutory condition was constituted, took
immediate steps to terminate the right of petitioner herein to the use of the lot.
Obedencio's present complaint was filed in May of 1975, barely several months
after the property was donated to him.
One last point raised by petitioner is his alleged right to recover damages under
the agreement of February 2, 1964. In the absence of evidence, considering that
the parties agreed to submit the case for decision on a stipulation of facts, We
have no basis for awarding damages to petitioner.
However, We apply Art. 579 of the Civil Code and hold that petitioner will not
forfeit the improvement he built on the lot but may remove the same without
causing damage to the property.
"Art. 579. The usufructuary may make on the property held in usufruct such useful
improvements or expenses for mere pleasure as he may deem proper, provided
he does not alter its form or substance; but he shall have no right to be
indemnified therefor. He may, however, removed such improvements, should it
be possible to do so without damage to the property." (emphasis supplied)
Finally, We cannot close this case without touching on the unirrigated riceland
which admittedly is in the possession of Natividad Obedencio.
In view of our ruling that the "barter agreement" of February 2, 1964, did not
transfer the ownership of the respective properties mentioned therein, it follows
that petitioner Baluran remains the owner of the unirrigated riceland and is now
entitled to its possession. With the happening of the resolutory condition
provided for in the agreement, the right of usufruct of the parties is extinguished
and each is entitled to a return of his property. It is true that Natividad Obedencio
who is now in possession of the property and who has been made a party to this
case cannot be ordered in this proceeding to surrender the riceland. But inasmuch
as reciprocal rights and obligations have arisen between the parties to the so
called "barter agreement", We hold that the parties and/or their successors-in-
interest are duty bound to effect a simultaneous transfer of the respective
properties if substantial justice is to be effected. prLL
WHEREFORE, judgment is hereby rendered: 1) declaring the petitioner Avelino
Baluran and respondent Antonio Obedencio the respective owners of the
unirrigated riceland and residential lot mentioned in the "Barter Agreement" of
February 2, 1964; 2) ordering Avelino Baluran to vacate the residential lot and
remove the improvements built by him thereon, provided, however, that he shall
not be compelled to do so unless the unirrigated riceland shall have been restored
to his possession either on volition of the party concerned or through judicial
proceedings which he may institute for the purpose.
4
Without pronouncement as to costs.
So Ordered.
Teehankee (Chairman), Makasiar, Martin, Fernandez and Guerrero, JJ., concur.
FIRST DIVISION
[G.R. No. 148830. April 13, 2005.]
NATIONAL HOUSING AUTHORITY, petitioner, vs. COURT OF APPEALS, BULACAN
GARDEN CORPORATION and MANILA SEEDLING BANK FOUNDATION, INC.,
respondents.
DECISION
CARPIO, J p:
The Case
This is a petition for review 1 seeking to set aside the Decision 2 dated 30 March
2001 of the Court of Appeals ("appellate court") in CA-G.R. CV No. 48382, as well
as its Resolution dated 25 June 2001 denying the motion for reconsideration. The
appellate court reversed the Decision 3 of Branch 87 of the Regional Trial Court of
Quezon City ("trial court") dated 8 March 1994 in Civil Case No. Q-53464. The trial
court dismissed the complaint for injunction filed by Bulacan Garden Corporation
("BGC") against the National Housing Authority ("NHA"). BGC wanted to enjoin
the NHA from demolishing BGC's facilities on a lot leased from Manila Seedling
Bank Foundation, Inc. ("MSBF"). MSBF allegedly has usufructuary rights over the
lot leased to BGC.
Antecedent Facts
On 24 October 1968, Proclamation No. 481 issued by then President Ferdinand
Marcos set aside a 120-hectare portion of land in Quezon City owned by the NHA
4 as reserved property for the site of the National Government Center ("NGC").
On 19 September 1977, President Marcos issued Proclamation No. 1670, which
removed a seven-hectare portion from the coverage of the NGC. Proclamation
No. 1670 gave MSBF usufructuary rights over this segregated portion, as follows:
Pursuant to the powers vested in me by the Constitution and the laws of the
Philippines, I, FERDINAND E. MARCOS, President of the Republic of the
Philippines, do hereby exclude from the operation of Proclamation No. 481, dated
October 24, 1968, which established the National Government Center Site,
certain parcels of land embraced therein and reserving the same for the Manila
Seedling Bank Foundation, Inc., for use in its operation and projects, subject to
private rights if any there be, and to future survey, under the administration of
the Foundation. ADEHTS
This parcel of land, which shall embrace 7 hectares, shall be determined by the
future survey based on the technical descriptions found in Proclamation No. 481,
and most particularly on the original survey of the area, dated July 1910 to June
1911, and on the subdivision survey dated April 19-25, 1968. (Emphasis added)
MSBF occupied the area granted by Proclamation No. 1670. Over the years,
MSBF's occupancy exceeded the seven-hectare area subject to its usufructuary
rights. By 1987, MSBF occupied approximately 16 hectares. By then the land
occupied by MSBF was bounded by Epifanio de los Santos Avenue ("EDSA") to the
west, Agham Road to the east, Quezon Avenue to the south and a creek to the
north.
On 18 August 1987, MSBF leased a portion of the area it occupied to BGC and
other stallholders. BGC leased the portion facing EDSA, which occupies 4,590
square meters of the 16-hectare area.
On 11 November 1987, President Corazon Aquino issued Memorandum Order No.
127 ("MO 127") which revoked the reserved status of "the 50 hectares, more or
less, remaining out of the 120 hectares of the NHA property reserved as site of
the National Government Center." MO 127 also authorized the NHA to
commercialize the area and to sell it to the public. cDCaTS
On 15 August 1988, acting on the power granted under MO 127, the NHA gave
BGC ten days to vacate its occupied area. Any structure left behind after the
expiration of the ten-day period will be demolished by NHA.
BGC then filed a complaint for injunction on 21 April 1988 before the trial court.
On 26 May 1988, BGC amended its complaint to include MSBF as its co-plaintiff.
The Trial Court's Ruling
The trial court agreed with BGC and MSBF that Proclamation No. 1670 gave MSBF
the right to conduct the survey, which would establish the seven-hectare area
covered by MSBF's usufructuary rights. However, the trial court held that MSBF
failed to act seasonably on this right to conduct the survey. The trial court ruled
that the previous surveys conducted by MSBF covered 16 hectares, and were thus
inappropriate to determine the seven-hectare area. The trial court concluded that
to allow MSBF to determine the seven-hectare area now would be grossly unfair
to the grantor of the usufruct.
On 8 March 1994, the trial court dismissed BGC's complaint for injunction. Thus:
Premises considered, the complaint praying to enjoin the National Housing
Authority from carrying out the demolition of the plaintiff's structure,
improvements and facilities in the premises in question is hereby DISMISSED, but
the suggestion for the Court to rule that Memorandum Order 127 has repealed
Proclamation No. 1670 is DENIED. No costs.
SO ORDERED. 5
The NHA demolished BGC's facilities soon thereafter. SDHacT
The Appellate Court's Ruling
Not content with the trial court's ruling, BGC appealed the trial court's Decision
to the appellate court. Initially, the appellate court agreed with the trial court that
Proclamation No. 1670 granted MSBF the right to determine the location of the
seven-hectare area covered by its usufructuary rights. However, the appellate
court ruled that MSBF did in fact assert this right by conducting two surveys and
erecting its main structures in the area of its choice.
On 30 March 2001, the appellate court reversed the trial court's ruling. Thus:
WHEREFORE, premises considered, the Decision dated March 8, 1994 of the
Regional Trial Court of Quezon City, Branch 87, is hereby REVERSED and SET
ASIDE. The National Housing Authority is enjoined from demolishing the
structures, facilities and improvements of the plaintiff-appellant Bulacan Garden
Corporation at its leased premises located in Quezon City which premises were
covered by Proclamation No. 1670, during the existence of the contract of lease
it (Bulacan Garden) had entered with the plaintiff-appellant Manila Seedling Bank
Foundation, Inc.
No costs.
SO ORDERED. 6
The NHA filed a motion for reconsideration, which was denied by the appellate
court on 25 June 2001.
Hence, this petition.
The Issues
The following issues are considered by this Court for resolution:
WHETHER THE PETITION IS NOW MOOT BECAUSE OF THE DEMOLITION OF THE
STRUCTURES OF BGC; and
WHETHER THE PREMISES LEASED BY BGC FROM MSBF IS WITHIN THE SEVEN-
HECTARE AREA THAT PROCLAMATION NO. 1670 GRANTED TO MSBF BY WAY OF
USUFRUCT. HSDaTC
The Ruling of the Court
We remand this petition to the trial court for a joint survey to determine finally
the metes and bounds of the seven-hectare area subject to MSBF's usufructuary
rights.
Whether the Petition is Moot because of the
Demolition of BGC's Facilities
BGC claims that the issue is now moot due to NHA's demolition of BGC's facilities
after the trial court dismissed BGC's complaint for injunction. BGC argues that
there is nothing more to enjoin and that there are no longer any rights left for
adjudication.
We disagree.
BGC may have lost interest in this case due to the demolition of its premises, but
its co-plaintiff, MSBF, has not. The issue for resolution has a direct effect on
MSBF's usufructuary rights. There is yet the central question of the exact location
of the seven-hectare area granted by Proclamation No. 1670 to MSBF. This issue
is squarely raised in this petition. There is a need to settle this issue to forestall
future disputes and to put this 20-year litigation to rest.
On the Location of the Seven-Hectare Area Granted by
Proclamation No. 1670 to MSBF as Usufructuary
Rule 45 of the 1997 Rules of Civil Procedure limits the jurisdiction of this Court to
the review of errors of law. 7 Absent any of the established grounds for exception,
8 this Court will not disturb findings of fact of lower courts. Though the matter
raised in this petition is factual, it deserves resolution because the findings of the
trial court and the appellate court conflict on several points.
The entire area bounded by Agham Road to the east, EDSA to the west, Quezon
Avenue to the south and by a creek to the north measures approximately 16
hectares. Proclamation No. 1670 gave MSBF a usufruct over only a seven-hectare
area. The BGC's leased portion is located along EDSA.
A usufruct may be constituted for a specified term and under such conditions as
the parties may deem convenient subject to the legal provisions on usufruct. 9 A
usufructuary may lease the object held in usufruct. 10 Thus, the NHA may not
evict BGC if the 4,590 square meter portion MSBF leased to BGC is within the
seven-hectare area held in usufruct by MSBF. The owner of the property must
respect the lease entered into by the usufructuary so long as the usufruct exists.
5
11 However, the NHA has the right to evict BGC if BGC occupied a portion outside
of the seven-hectare area covered by MSBF's usufructuary rights. DTEScI
MSBF's survey shows that BGC's stall is within the seven-hectare area. On the
other hand, NHA's survey shows otherwise. The entire controversy revolves on
the question of whose land survey should prevail.
MSBF's survey plots the location of the seven-hectare portion by starting its
measurement from Quezon Avenue going northward along EDSA up until the
creek, which serves as the northern boundary of the land in question. Mr. Ben
Malto ("Malto"), surveyor for MSBF, based his survey method on the fact that
MSBF's main facilities are located within this area.
On the other hand, NHA's survey determines the seven-hectare portion by
starting its measurement from Quezon Avenue going towards Agham Road. Mr.
Rogelio Inobaya ("Inobaya"), surveyor for NHA, based his survey method on the
fact that he saw MSBF's gate fronting Agham Road.
BGC presented the testimony of Mr. Lucito M. Bertol ("Bertol"), General Manager
of MSBF. Bertol presented a map, 12 which detailed the area presently occupied
by MSBF. The map had a yellow-shaded portion, which was supposed to indicate
the seven-hectare area. It was clear from both the map and Bertol's testimony
that MSBF knew that it had occupied an area in excess of the seven-hectare area
granted by Proclamation No. 1670. 13 Upon cross-examination, Bertol admitted
that he personally did not know the exact boundaries of the seven-hectare area.
14 Bertol also admitted that MSBF prepared the map without consulting NHA, the
owner of the property. 15
BGC also presented the testimony of Malto, a registered forester and the
Assistant Vice-President of Planning, Research and Marketing of MSBF. Malto
testified that he conducted the land survey, which was used to construct the map
presented by Bertol. 16 Bertol clarified that he authorized two surveys, one in
1984 when he first joined MSBF, and the other in 1986. 17 In both instances, Mr.
Malto testified that he was asked to survey a total of 16 hectares, not just seven
hectares. Malto testified that he conducted the second survey in 1986 on the
instruction of MSBF's general manager. According to Malto, it was only in the
second survey that he was told to determine the seven-hectare portion. Malto
further clarified that he based the technical descriptions of both surveys on a
previously existing survey of the property. 18
The NHA presented the testimony of Inobaya, a geodetic engineer employed by
the NHA. Inobaya testified that as part of the NHA's Survey Division, his duties
included conducting surveys of properties administered by the NHA. 19 Inobaya
conducted his survey in May 1988 to determine whether BGC was occupying an
area outside the seven-hectare area MSBF held in usufruct. 20 Inobaya surveyed
the area occupied by MSBF following the same technical descriptions used by
Malto. Inobaya also came to the same conclusion that the area occupied by MSBF,
as indicated by the boundaries in the technical descriptions, covered a total of 16
hectares. He further testified that the seven-hectare portion in the map presented
by BGC, 21 which was constructed by Malto, does not tally with the boundaries
BGC and MSBF indicated in their complaint.
Article 565 of the Civil Code states:
ART. 565. The rights and obligations of the usufructuary shall be those provided
in the title constituting the usufruct; in default of such title, or in case it is
deficient, the provisions contained in the two following Chapters shall be
observed.
In the present case, Proclamation No. 1670 is the title constituting the usufruct.
Proclamation No. 1670 categorically states that the seven-hectare area shall be
determined "by future survey under the administration of the Foundation subject
to private rights if there be any." The appellate court and the trial court agree that
MSBF has the latitude to determine the location of its seven-hectare usufruct
portion within the 16-hectare area. The appellate court and the trial court
disagree, however, whether MSBF seasonably exercised this right.
It is clear that MSBF conducted at least two surveys. Although both surveys
covered a total of 16 hectares, the second survey specifically indicated a seven-
hectare area shaded in yellow. MSBF made the first survey in 1984 and the second
in 1986, way before the present controversy started. MSBF conducted the two
surveys before the lease to BGC. The trial court ruled that MSBF did not act
seasonably in exercising its right to conduct the survey. Confronted with evidence
that MSBF did in fact conduct two surveys, the trial court dismissed the two
surveys as self-serving. This is clearly an error on the part of the trial court.
Proclamation No. 1670 authorized MSBF to determine the location of the seven-
hectare area. This authority, coupled with the fact that Proclamation No. 1670 did
not state the location of the seven-hectare area, leaves no room for doubt that
Proclamation No. 1670 left it to MSBF to choose the location of the seven-hectare
area under its usufruct. EHTISC
More evidence supports MSBF's stand on the location of the seven-hectare area.
The main structures of MSBF are found in the area indicated by MSBF's survey.
These structures are the main office, the three green houses, the warehouse and
the composting area. On the other hand, the NHA's delineation of the seven-
hectare area would cover only the four hardening bays and the display area. It is
easy to distinguish between these two groups of structures. The first group covers
buildings and facilities that MSBF needs for its operations. MSBF built these
structures before the present controversy started. The second group covers
facilities less essential to MSBF's existence. This distinction is decisive as to which
survey should prevail. It is clear that the MSBF intended to use the yellow-shaded
area primarily because it erected its main structures there.
Inobaya testified that his main consideration in using Agham Road as the starting
point for his survey was the presence of a gate there. The location of the gate is
not a sufficient basis to determine the starting point. MSBF's right as a
usufructuary as granted by Proclamation No. 1670 should rest on something more
substantial than where MSBF chose to place a gate.
To prefer the NHA's survey to MSBF's survey will strip MSBF of most of its main
facilities. Only the main building of MSBF will remain with MSBF since the main
building is near the corner of EDSA and Quezon Avenue. The rest of MSBF's main
facilities will be outside the seven-hectare area.
On the other hand, this Court cannot countenance MSBF's act of exceeding the
seven-hectare portion granted to it by Proclamation No. 1670. A usufruct is not
simply about rights and privileges. A usufructuary has the duty to protect the
owner's interests. One such duty is found in Article 601 of the Civil Code which
states:
ART. 601. The usufructuary shall be obliged to notify the owner of any act of a
third person, of which he may have knowledge, that may be prejudicial to the
rights of ownership, and he shall be liable should he not do so, for damages, as if
they had been caused through his own fault.
A usufruct gives a right to enjoy the property of another with the obligation of
preserving its form and substance, unless the title constituting it or the law
otherwise provides. 22 This controversy would not have arisen had MSBF
respected the limit of the beneficial use given to it. MSBF's encroachment of its
benefactor's property gave birth to the confusion that attended this case. To put
this matter entirely to rest, it is not enough to remind the NHA to respect MSBF's
choice of the location of its seven-hectare area. MSBF, for its part, must vacate
the area that is not part of its usufruct. MSBF's rights begin and end within the
seven-hectare portion of its usufruct. This Court agrees with the trial court that
MSBF has abused the privilege given it under Proclamation No. 1670. The direct
corollary of enforcing MSBF's rights within the seven-hectare area is the negation
of any of MSBF's acts beyond it.
The seven-hectare portion of MSBF is no longer easily determinable considering
the varied structures erected within and surrounding the area. Both parties
advance different reasons why their own surveys should be preferred. At this
point, the determination of the seven-hectare portion cannot be made to rely on
a choice between the NHA's and MSBF's survey. There is a need for a new survey,
one conducted jointly by the NHA and MSBF, to remove all doubts on the exact
location of the seven-hectare area and thus avoid future controversies. This new
survey should consider existing structures of MSBF. It should as much as possible
include all of the facilities of MSBF within the seven-hectare portion without
sacrificing contiguity. CAaDTH
A final point. Article 605 of the Civil Code states:
ART. 605. Usufruct cannot be constituted in favor of a town, corporation, or
association for more than fifty years. If it has been constituted, and before the
expiration of such period the town is abandoned, or the corporation or
association is dissolved, the usufruct shall be extinguished by reason thereof.
(Emphasis added)
The law clearly limits any usufruct constituted in favor of a corporation or
association to 50 years. A usufruct is meant only as a lifetime grant. Unlike a
natural person, a corporation or association's lifetime may be extended
indefinitely. The usufruct would then be perpetual. This is especially invidious in
cases where the usufruct given to a corporation or association covers public land.
Proclamation No. 1670 was issued 19 September 1977, or 28 years ago. Hence,
under Article 605, the usufruct in favor of MSBF has 22 years left.
MO 127 released approximately 50 hectares of the NHA property as reserved site
for the National Government Center. However, MO 127 does not affect MSBF's
seven-hectare area since under Proclamation No. 1670, MSBF's seven-hectare
area was already "exclude[d] from the operation of Proclamation No. 481, dated
October 24, 1968, which established the National Government Center Site."
WHEREFORE, the Decision of the Court of Appeals dated 30 March 2001 and its
Resolution dated 25 June 2001 in CA-G.R. CV No. 48382 are SET ASIDE. This case
is REMANDED to Branch 87 of the Regional Trial Court of Quezon City, which shall
order a joint survey by the National Housing Authority and Manila Seedling Bank
Foundation, Inc. to determine the metes and bounds of the seven-hectare portion
of Manila Seedling Bank Foundation, Inc. under Proclamation No. 1670. The
seven-hectare portion shall be contiguous and shall include as much as possible
all existing major improvements of Manila Seedling Bank Foundation, Inc. The
parties shall submit the joint survey to the Regional Trial Court for its approval
within sixty days from the date ordering the joint survey.
SO ORDERED.
Davide, Jr., C.J., Quisumbing, Ynares-Santiago and Azcuna, JJ., concur.
6
EN BANC
[G.R. No. L-21809. January 31, 1966.]
GIL P. POLICARPIO, ET AL., plaintiffs-appellees, vs. JOSE V. SALAMAT, ET AL.,
defendants, VICENTE ASUNCION, ET AL., defendants-appellants.
Tansinsin & Tansinsin for the defendants and appellants.
Eugenio Balabat for the plaintiffs and appellees.
SYLLABUS
1. USUFRUCT; DEATH OF ONE OF USUFRUCTUARIES BEFORE END OF USUFRUCT;
ACCRETION AMONG USUFRUCTUARIES; EXCEPTION. — There is accretion among
usufructuaries who are constituted at the same time when one of them dies
before the end of the usufruct. The only exception is if the usufruct is constituted
in a last will and testament and the testator makes a contrary provision. In the
instant case, there is none. On the contrary, the testatrix constituted the usufruct
in favor of the children of her three cousins with the particular injunction that
they are the only ones to enjoy the same as long as they live, from which it can be
implied that, should any of them die, the share of the latter shall accrue to the
surviving ones. These provisions of the will are clear. They do not admit of any
other interpretation.
DECISION
BAUTISTA ANGELO, J p:
In a duly probated last will and testament of one Damasa Crisostomo, she gave
the naked ownership of a fishpond owned by her to her sister Teodorica de la Cruz
while its usufruct to the children of her cousins Antonio Perez, Patricia Vicente
and Canuto Lorenzo. The fishpond is situated at a barrio of Hagonoy, Bulacan.
The children of Antonio Perez, Patricia Vicente and Canuto Lorenzo turned out to
be fourteen, namely: Maria, Pio, Fructuosa, Graciano, Vicente, Victoria, Teodora,
and Juan, all surnamed Perez, Apolonio Lorenzo, Bonifacio Lorenzo, Vicente
Asuncion, Francisco Lorenzo, Leoncio Perez and Servillano Perez. On the other
hand, Teodorica dela Cruz, the naked owner, bequeathed in her will all her rights
to the fishpond to Jose V. Salamat.
The fourteen usufructuaries leased the fishpond first to one Gil P. Policarpio who
used to give them proportionately the usufruct corresponding to them. During
the term of the lease, however, three of the usufructuaries died, namely,
Francisco Lorenzo, Leoncio M. Perez and Servillano Perez, and so, upon their
death, both the naked owner and the remaining usufructuaries claimed the shares
corresponding to the deceased usufructuaries in the amount of (P10,714.26.
Because of these conflicting claims, the lessee withheld said amount.
Subsequently, on May 31, 1962, the surviving usufructuaries leased the fishpond
to one Batas Riego de Dios who, after executing the contract of lease, came to
know of the existing conflicting claims, and not knowing to whom of the claimants
the shares of the deceased usufructuaries should be paid, said lessee was also
constrained to withhold the corresponding part of the usufruct of the property.
So, on November 15, 1962, the two lessees commenced the present action for
interpleader against both the naked owner and surviving usufructuaries to compel
them to interplead and litigate their conflicting claims.
Defendant Jose V. Salamat avers as special defense that he is the successor-in-
interest of Teodorica dela Cruz and as such he is entitled to the shares
corresponding to the three deceased usufructuaries in as much as the usufruct in
their favor was automatically extinguished by death and became merged with the
naked owner.
The surviving usufructuaries, on the other hand, adhere to the theory that since
the usufructuaries were instituted simultaneously by the late Damasa Crisostomo,
the death of the three usufructuaries did not extinguish the usufruct; hence, the
surviving usufructuaries are entitled to receive the shares corresponding to the
deceased usufructuaries, the usufruct to continue until the death of the last
usufructuary.
When the case was called for hearing, the parties agreed to submit the case for
decision upon the submission of their respective memoranda considering that the
issue involved was purely legal in nature, and on March 29, 1963, the trial court
rendered decision the dispositive part of which reads as follows:
"Wherefore, judgment is hereby rendered declaring defendant Jose V. Salamat
entitled to the sum of P10,714.26 representing the shares of the three deceased
usufructuaries in the lease rental due from plaintiff Gil Policarpio, ordering the
latter to deliver to said defendant the aforesaid amount; and likewise declaring
said defendant Jose V. Salamat entitled to share with the eleven usufructuaries in
the proceeds of the lease contract executed by them with plaintiff Batas Riego de
Dios, ordering the latter to deliver to him such amount as would be equivalent to
the shares of the three deceased usufructuaries, with the parties bearing their
own costs and expenses of litigation."
The surviving usufructuaries took the present appeal.
The important issue to be determined is whether the eleven surviving Batas Riego de Dios are hereby ordered to pay to them the money withheld by
usufructuaries of the fishpond in question are the ones entitled to the fruits that them respectively representing the shares of the deceased usufructuaries. No
would have corresponded to the three deceased usufructuaries, or the naked costs.
owner Jose V. Salamat.
Bengzon, C.J., Concepcion, Reyes, J.B.L., Dizon, Regala, Makalintal, Bengzon, J.P.
Appellants argue that it is the surviving usufructuaries who are entitled to receive and Zaldivar, JJ., concur.
the shares of the deceased by virtue of Article 611 of the Civil Code which
provides: "A usufruct constituted in favor of several persons living at the time of Barrera, J., took no part.
its constitution shall not be extinguished until the death of the last survivor." On
the other hand, appellee contends that the most a usufruct can endure if
constituted in favor of a natural person is the lifetime of the usufructuary, because
a usufruct is extinguished by the death of the usufructuary unless a contrary
intention clearly appears (Article 603, Civil Code). Hence, appellee argues, when
the three usufructuaries died, their usufructuary rights were extinguished and
whatever rights they had to the fruits reverted to the naked owner.

If the theory of appellee in the sense that the death of the three usufructuaries
has the effect of consolidating their rights with that of the naked owner were
correct, Article 611 of the Civil Code would be superfluous, because Article 603
already provides that the death of the usufructuary extinguishes the usufruct
unless the contrary appears. Furthermore, said theory would cause a partial
extinction of the usufruct, contrary to the provisions of Article 611 which
expressly provides that the usufruct shall not be extinguished until the death of
the last survivor. The theory of appellee cannot, therefore, be entertained.

The well-known Spanish commentators on the counterpart of Article 611 we have

copied above which implicitly provides that the share of a usufructuary who dies
in the meantime inures to the benefit of the surviving usufructuaries, also uphold
the view we here express. Thus, the following is their comment on the matter:

"Al comentar el art. 469 (now Art. 564) hablamos, entre las formas de constitución
del usufructo, del disfrute simultaneo y sucesivo. Ninguna duda cabe, puesto que
el derecho de acrecer es aplicable a los usufructuaríos, según el art. 987 (now Art.
1023), sobre la no extinción del usufructo simultáneo, hasta la muerte de la última
persona que sobreviva . . .

". . . Al referirse . . . el art. 521 (now Art. 621) al usufructo constituido en provecho
de varias personas vivas al tiempo de su constitucion, parece referirse al usufructo
simultáneo. Sin embargo, es indudable que se refiere tambien al sucesivo, puesto
que en esta especie de usufructo el segundo usufructuario no entra en el disfrute,
salvo expresion en contrario, hasta la muerte del primero, y es claro que al morir
el último llamado, se extingue el usufructo, que es precisamente lo que ordena el
presente articulo." (Manresa, Comentarios al Codigo Civil Español, 1931, Tomo IV,
p. 486).

". . . refiriendonos al caso de muerte natural, ha de tenerse presente que si son

muchos los llamados al usufructo simultáneamente, muerto uno, su porcian
acrece á demás á no ser que el testador exprese lo contrario, ó se infiriera así del
título en que se constituyó el usufructo, para lo cual puede verse la doctrina de la
ley 33, tit. I, lib. VII del Digesto, que habla del derecho de acrecer en el usufructo,
y el tit. IV del mismo libro, en que se proponen algunos casos de excepcion. — El
usufructo constituido en provecho de varias personas vivas al tiempo de su
constitución. no se extinguírá hasta la muerte de la última que sobrevívíere. Cód.
Civ. art. 521." (Del Viso, Lecciones Elementales de Derecho Civil, sexta edicion,
Tomo I, p. 86.)

"Si a varios usufructuarios se les lega la totalidad de una herencia, o una misma
parte de ella, se da el derecho de acrecer cuando uno de ellos muere despues del
testador, sobreviviendo otro y otros? — Como dice la obra anotada, el Digesto
admitió, según un texto de Paulo, la solución afirmativa, y Pothier reprodujo dicha
doctrina.

"La jurisprudencia del Tribunal Supremo español ha admitido y sancionado

también en le sentencia de 29 de marzo de 1905, aunque no por aplicación del
derecho de acrecer, y sí por aplicación de la voluntad presunta del testador, que
habiéndose legado el usufructo vitalicio del remanente de sus bienes, por partes
iguales, a dos hermanas, debe entenderse que ellas, o cualquiera de las dos que
sobreviviere a la otra, había de disfrutar dicho usufructo, no constituyendo la
separación de partes sino una previsión del testador, para el arreglo del usufructo
total durante la vida de las dos usufructuaries." (Colin and Capitant, Curso
Elemental de Derecho Civil, 1957, Tomo VIII, pp. 605-606)

It, therefore, appears that the Spanish commentators on the subject are
unanimous that there is accretion among usufructuaries who are constituted at
the same time when one of them dies before the end of the usufruct. The only
exception is if the usufruct is constituted in a last will and testament and the
testator makes a contrary provision. Here there is none. On the contrary, the
testatrix constituted the usufruct in favor of the children of her three cousins with
the particular injunction that they are the only ones to enjoy the same as long as
they live, from which it can be implied that, should any of them die, the share of
the latter shall accrue to the surviving ones. These provisions of the will are clear.
They do not admit of any other interpretation.

Wherefore, the decision appealed from is reversed. The eleven surviving

usufructuaries are hereby declared to be entitled to the shares of the three
deceased usufructuaries and, hence, as a corollary, appellees Gil P. Policarpio and
7